Moderna Inc.'s headquarters in Cambridge, Massachusetts, U.S., on Tuesday, March 26, 2024.
Adam Glanzmann | Bloomberg | Getty Images
Moderna Advanced Medical Center Inc. reported second-quarter revenue that beat expectations on Thursday but lowered its full-year sales guidance, citing lower expected sales in Europe, a “competitive environment” for respiratory vaccines in the United States and the possibility of international revenue being delayed until 2025.
The biotech company now expects product revenue in 2024 to be between $3 billion and $3.5 billion, down from previous guidance of $4 billion.
The company's shares fell more than 20% on Thursday.
The company has begun shipping doses of its respiratory syncytial virus vaccine, called mRESVIA, in the United States after it was approved in May for seniors. It’s Moderna’s second commercially available product after its Covid vaccine, which has seen demand decline as the world emerges from the pandemic and relies less on injections and preventive treatments.
Moderna CEO Stephane Bancel told CNBC that there is “more competition” for RSV and COVID vaccines. He noted that mRESVIA is the third RSV vaccine to enter the market, following vaccines from Pfizer And GlaxoSmithKlinethe latter of which dominated the market last year.
“We have had very intensive discussions with governments across Europe” to obtain supplies of Moderna's Covid vaccine, he added.
But Bancel said that “some countries, even last week, told us that because of the very tight budget … they do not have the capacity to buy more vaccine than they need because they already have” another contract.
He is referring to the massive Covid vaccine supply contract that has been renegotiated with the European Union. Pfizer and its German partner BioNTechHe also pointed to the ongoing war in Ukraine, which is putting pressure on government budgets.
However, Moderna expects to return to sales growth in 2025 and break even by 2026, as new products are launched, Bancel said.
Here's what Moderna reported for the second quarter compared to what Wall Street was expecting, based on a survey of analysts conducted by LSEG:
Loss per share: $3.33 vs. $3.39 expected Revenue: $241 million vs. $132 million expected
The company reported second-quarter revenue of $241 million, with sales of its Covid vaccine products down 37% from the same period last year. Moderna reported revenue of $344 million in the year-ago period.
The company said the revenue decline was partly due to an expected shift to the seasonal Covid vaccine market, where patients typically get their shots in the fall and winter. But Bancel said Moderna has a “good spring season” in the U.S. for older adults, who are recommended to get an extra dose of the latest round of Covid vaccines.
Moderna reported a net loss of $1.28 billion, or $3.33 per share, in the second quarter. That compares with a net loss of $1.38 billion, or $3.62 per share, reported in the year-ago period.
Bancel said the company lost less than Wall Street had expected, partly due to progress it made in cutting costs.
Moderna “had slightly higher-than-expected sales but significant cost savings that were above what the market expected,” he said. “That's why I'm really pleased with the progress we're making on both fronts.”
Cost of sales was $115 million, down 84% from the same period last year. That includes $14 million in write-downs for unused doses of the Covid vaccine and $55 million in charges related to the company’s efforts to reduce its manufacturing footprint, among other costs.
Research and development expenses for the second quarter increased 6% to $1.2 billion compared to the same period in 2023. This increase was primarily due to personnel costs, including increased headcount.
Meanwhile, selling and general administration expenses decreased 19% during the period to $268 million compared to the second quarter of 2023. Selling and general administration expenses typically include the costs of promoting, selling and delivering the company's products and services.
Moderna has so far managed to boost investor sentiment about its path forward post-Covid. Its shares are up about 20% this year on growing confidence in its pipeline and its mRNA platform, the technology used in its Covid and RSV vaccines.
The biotech company currently has 45 products in development, five of which are in late-stage trials. These include its combination vaccine targeting Covid and influenza, which could see approval as early as 2025.
Moderna is also developing a standalone influenza vaccine, a cancer vaccine, and Merck Vaccines for latent viruses, among other products.
