On August 3, 2023 Moderna, Inc. (Nasdaq: MRNA), a biotechnology company pioneering messenger RNA (mRNA) therapeutics and vaccines, reported financial results and provided business updates for the second quarter of 2023 (Press release, Moderna Therapeutics, AUG 3, 2023, View Source [SID1234634927]).
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"Second quarter sales were on target, given the seasonal nature of Covid. I am pleased with the progress our
U.S. commercial team has made to get new contracts in place for fall 2023. We are on track to deliver 2023 sales
between $6 billion to $8 billion, depending on Covid vaccination rates in the U.S.," said Stéphane Bancel, Chief
Executive Officer of Moderna. "Our late-stage clinical pipeline is firing on all cylinders with four infectious disease
vaccines in Phase 3, including RSV which was recently submitted to regulators for approval. Our individualized
neoantigen therapy is now in Phase 3 for melanoma and our lead rare disease program for PA is in dose
confirmation. We believe that all these products should launch in 2024, 2025 or 2026, and we are continuing to
invest in scaling Moderna to bring forward an unprecedented number of innovative mRNA medicines for patients."
Recent progress includes:
Respiratory Vaccines
COVID-19
The Company presented clinical data at the June VRBPAC meeting demonstrating potent neutralization and
cross-reactivity with its monovalent XBB.1.5 vaccine, mRNA-1273.815. Similar neutralization was seen for
XBB.1.5, XBB.1.16, and XBB.2.3.2 sub-variants. Following the FDA’s recommendation for a monovalent SARSCoV-2 XBB lineage vaccine, which aligns with other regulators and global public health agencies, Moderna has
submitted its updated COVID-19 vaccine to regulators globally for approval or authorization and is ready for fall
vaccination season with ample and timely supply.
RSV
Moderna has submitted marketing authorization applications globally for mRNA-1345, a vaccine for the
prevention of RSV-associated lower respiratory tract disease (RSV-LRTD) and acute respiratory disease (ARD) in
adults aged 60 years or older.
The regulatory applications are based on positive data from a prespecified interim analysis of the pivotal
ConquerRSV study, a randomized, double-blind, placebo-controlled study of approximately 37,000 adults 60
years or older in 22 countries. The primary efficacy endpoints were based on two definitions of RSV-LRTD,
defined as either two or more symptoms or three or more symptoms of disease. The trial met both its primary
efficacy endpoints, with a vaccine efficacy (VE) of 83.7% (95.88% CI: 66.1%, 92.2%; p<0.0001) against RSVLRTD as defined by two or more symptoms, and a VE of 82.4% (96.36% CI: 34.8%, 95.3%; p=0.0078) against
RSV-LRTD defined by three or more symptoms. In addition to older adults, mRNA-1345 is being investigated in a
fully enrolled, ongoing Phase 1 trial in pediatric populations. No cases of Guillain-Barre Syndrome (GBS) had
been reported with mRNA-1345 in the Phase 3 RSV trial as of the April 30th cutoff date.
Flu
Enrollment has been successfully completed in the Company’s Phase 3 immunogenicity trial (P303) for an
enhanced formulation of mRNA-1010. This updated formulation is anticipated to generate an improved immune
response to influenza B strains and is intended to enable licensure of mRNA-1010 through accelerated approval.
The Company expects to share an update on P303 in the third quarter of 2023.
Latent Virus Vaccines
Cytomegalovirus (CMV)
The pivotal Phase 3 study of Moderna’s CMV vaccine candidate (mRNA-1647), known as CMVictory, is ongoing,
with enrollment more than 80% complete.
Epstein-Barr virus (EBV)
Enrollment is complete (350 healthy EBV-seropositive adults), and dosing continues in the Phase 1 trial of
mRNA-1195 designed to evaluate safety, reactogenicity, and immunogenicity. mRNA-1195 is a therapeutic
vaccine candidate designed to prevent longer-term sequelae of EBV infection, such as multiple sclerosis and
post-transplant lymphoproliferative disease (PTLD). Enrollment is ongoing for the Phase 1 trial of mRNA-1189
aimed at preventing infectious mononucleosis (IM).
Therapeutics
Immuno-oncology
Merck and Moderna announced the initiation of a pivotal Phase 3 global, randomized, double-blind, placebo- and
active-comparator-controlled study (V940-001) to evaluate the safety and efficacy of mRNA-4157 (V940) in
combination with KEYTRUDA in people with resected high-risk (Stage IIB-IV) melanoma compared to
KEYTRUDA alone. The trial is slated to enroll approximately 1,089 patients at more than 165 sites in over 25
countries. The primary endpoint of the study is recurrence-free survival (RFS), and secondary endpoints include
distant metastasis-free survival (DFMS), overall survival (OS) and safety. Moderna and Merck plan to expand the
development program to additional tumor types, including non-small cell lung cancer (NSCLC).
Rare diseases
Propionic Acidemia (PA)
The ongoing global Phase 1/2 clinical trial of mRNA-3927 is ongoing and currently enrolling patients in the dose
confirmation arm. This trial includes a dose optimization stage (cohorts 1 through 5) followed by a dose
confirmation stage with progression dependent on the safety of the preceding cohort. Enrollment is complete for
cohorts 1 through 5. mRNA-3927 has been well-tolerated at the doses administered, with encouraging early signs
of dose-dependent pharmacology and potential clinical benefit. The majority of eligible participants have elected
to continue with treatment by participating in the Open-Label Extension Study. Interim data was presented at the
American Society of Gene & Cell Therapy (ASGCT) (Free ASGCT Whitepaper) on May 18, 2023.
Methylmalonic acidemia (MMA)
The Phase 1 trial evaluating the safety and pharmacology of mRNA-3705 in patients 1 year of age and older with
MMA in a multiple ascending dose study is ongoing and enrolling patients in the fourth cohort.
Second Quarter 2023 Financial Results
Revenue: Total revenue for the second quarter of 2023 was $344 million, compared to $4.7 billion in the same
period in 2022, mainly due to a decrease in sales of the Company’s COVID-19 vaccine. Product sales for the
second quarter of 2023 were $293 million, a decrease of 94% compared to the same period in 2022, primarily
driven by lower sales volume.
Cost of Sales: Cost of sales for the second quarter of 2023 was $731 million. In addition to unit driven
manufacturing costs, this includes royalties of $12 million and the following charges: $464 million for inventory
write-downs related to excess and obsolete COVID-19 product, unutilized manufacturing capacity of $135 million,
and losses on firm purchase commitments of $75 million. These charges, other than royalties, were primarily
driven by a shift in product demand to our latest monovalent XBB.1.5 COVID-19 vaccine candidate as well as a
decline in customer demand. The shift from a bivalent to monovalent strain selection rendered the remaining
mRNA-1273.222 product inventory obsolete. Cost of sales as a percent of product sales was 249% of product
sales, compared to 30% in the second quarter of 2022. The increase was driven by the aforementioned charges
over lower product sales compared to the prior year, driven by a decline in product demand and increased
product seasonality.
Research and Development Expenses: Research and development expenses for the second quarter of 2023
increased by 62% to $1.1 billion, in comparison to the same quarter of 2022. The growth in spending was mainly
due to an increase in clinical trial-related expenses, largely driven by increased clinical development activities,
particularly with respect to the Company’s RSV, seasonal flu and CMV programs. The growth was also driven by
an increase in personnel-related costs, due to increased headcount to support research and development efforts.
Selling, General and Administrative Expenses: Selling, general and administrative expenses for the second
quarter of 2023 increased by 57% to $332 million, in comparison to the second quarter of 2022. The growth in
spending was primarily due to increases in outside services spend and personnel-related costs, primarily driven
by increased headcount and spend in digital, medical affairs and commercial functions in support of the
Company’s digital initiatives, marketed products and expansion.
Income Taxes: Income tax benefit for the second quarter of 2023 was $369 million, driven by the Company’s fullyear outlook, which includes research and development credits, international provisions, and non-recurring items.
Net (Loss) Income: Net loss was $(1.4) billion for the second quarter of 2023, compared to net income of $2.2
billion for the second quarter of 2022.
(Loss) Earnings Per Share: Diluted loss per share was $(3.62) for the second quarter of 2023, compared to
diluted earnings per share of $5.24 for the second quarter of 2022.
2023 Commercial Updates
COVID-19: The Company reported $0.3 billion in COVID-19 vaccine sales in the second quarter, leading to $2.1
billion in total vaccine sales for the first half of the year, achieving our expectations for the first half of the year.
The Company expects 2023 COVID-19 vaccine sales of $6 billion to $8 billion, with approximately $4 billion from
previously announced COVID-19 vaccine Advance Purchase Agreements (APAs) and $2 billion to $4 billion in
signed and anticipated commercial contracts in the U.S., as well as other markets. The range for product sales is
primarily driven by the U.S. fall 2023 COVID-19 market size, which is dependent on vaccination rates and is likely
to be 50 to 100 million doses. As a result of recent discussions with country level customers, we now expect
approximately $1 billion of the original $5 billion in APAs to be deferred to 2024. In the U.S., commercial contracts
are signed with national and regional pharmacies, wholesalers and distributors, group purchasing organizations,
integrated delivery networks & health systems, U.S. Government entities, employers and other providers, and we
continue to work on additional contracts. The Company has finalized a contract with the government of Japan for
the provision of vaccines for the 2023 vaccination season and is in active supply discussions for additional new
orders for fall 2023 in the U.S., EU and other markets.
RSV: The Company continues to expect a 2024 launch of its RSV vaccine with a potential best-in-class profile
and has initiated a rolling submission process for a Biologics License Application (BLA) with the FDA. The
Company has also completed regulatory applications in Europe, Switzerland, Australia and the U.K., and has
started to manufacture mRNA-1345. mRNA-1345 will be provided to customers in ready-to-use pre-filled syringes.
2023 Financial Framework
Product Sales: The Company is expecting 2023 COVID-19 sales of $6 billion to $8 billion, dependent on U.S.
vaccination rates. Total expected 2023 sales are comprised of approximately $4 billion from existing APAs and $2
billion to $4 billion from additional sales to the U.S., Japan, EU and other countries. Sales will be subject to the
timing of regulatory approvals, with the Company currently expecting a 2023 second half sales split of
approximately 30% in the third quarter and 70% in the fourth quarter.
Cost of Sales: The Company now expects cost of sales to be approximately $3.5 billion to $4 billion for the year.
Research and Development and Selling, General and Administrative Expenses: The Company continues to
expect full-year 2023 expenses of approximately $6.0 billion, with approximately $4.5 billion in R&D.
Income Taxes: The Company now anticipates a full-year tax benefit of approximately $0.7 billion to $1.0 billion,
driven by an assumed operating loss, R&D credits, international tax provisions and non-recurring items.
Capital Expenditures: The Company continues to expect capital expenditures for 2023 of approximately $1
billion.
Corporate Updates
Continued Growth:
• Moderna had approximately 5,150 employees as of June 30, 2023, compared to approximately 3,400
employees as of June 30, 2022
• Moderna and IBM announced an agreement to explore quantum computing and generative AI for mRNA
science
• Moderna announced clinical and program updates at its 4th Vaccines Day
• Moderna acquired a site in Marlborough, Mass to support future manufacturing
Company Accolades:
• Moderna was recognized as the 6th Most Innovative Company in BCG’s annual report (third consecutive
year on the list)
• Moderna was recognized as #211 on the Fortune 500 (second consecutive year on the list)
Key 2023 Investor and Analyst Event Dates
• R&D Day: September 13
• ESG Day: December 7
Investor Call and Webcast Information
Moderna will host a live conference call and webcast at 8:00 a.m. ET on August 3, 2023. To access the live
conference call via telephone, please register at the link below. Once registered, dial-in numbers and a unique pin
number will be provided. A live webcast of the call will also be available under "Events and Presentations" in the
Investors section of the Moderna website.
• Telephone: https://register.vevent.com/register/BIeed35e9f283f418daaada893c474abbb
• Webcast: View Source
The archived webcast will be available on Moderna’s website approximately two hours after the conference call
and will be available for one year following the call.