Wall Street is finally in on the joke
Shares in Moderna and BioNTech are cratering as investors realize that demand for mRNA jabs for Covid and other respiratory illnesses will be near-zero going forward
It couldn’t have happened to a nicer bunch of medical billionaires.
Investors are voting on the failure of mRNA technology with their feet, fleeing the stocks of Moderna and BioNTech, the two companies that had the greatest wins on the mRNA Covid jabs.
In 2021 and 2022, Moderna and BioNTech rode Covid to tens of billions of dollars in profits. That gravy train is over.
Today, shares in Moderna and BioNTech fell below $100 a share for the first time since the jabs came to market in 2020, plunging almost 10 percent after BioNTech reported weak second-quarter sales and said it would reduce its planned research spending.
Both companies are down almost 80 percent from their 2021 peaks. Pfizer, which markets BioNTech’s mRNA jab and shares profits equally with BioNTech, has also fallen, though not as much, since Pfizer has non-mRNA products.
Behind the plunge: demand for Covid shots has fallen off a cliff worldwide and shows no signs of recovering. Last month, Germany said it expected to throw out 200 million expired shots, more than the total number it has administered.
(HOPING YOUR DEMAND FOR MY PRODUCT REMAINS HIGH! LUCKILY, READING THE TRUTH HAS ONLY POSITIVE SIDE EFFECTS)
A few months ago, Pfizer predicted that 100 million Covid jabs would be administered in the United States in 2023. Pfizer’s executives no doubt expected that estimate was conservative, given that publicly traded companies would much rather surprise investors with good news than bad news.
But Pfizer disclosed last week that only about 12 million shots have been given so far - and most came very early in the year. “The 12.4 million doses are behind our earlier projections,” Pfizer chief executive Albert Bourla acknowledged on a conference call last week. (Full disclosure: I am suing Bourla as part of Berenson v. Biden.)
Meanwhile, efforts to expand mRNA technology to jabs to prevent the flu and RSV are faltering. Large clinical trials suggest that the mRNA shots for those illnesses cause serious side effects at the same rate as they do for Covid.
But RSV is very mild compared to Covid, even the Omicron variant. And flu shots that are much less likely to cause serious side effects than the mRNAs have been around for generations. So why would anyone want mRNA jabs for either the flu or RSV - even if they manage to pass regulatory approval?
(It was fun while it lasted!)
The stock prices of Moderna and BioNTech offer a fascinating counterpoint to changing expectations of mRNA jab efficacy over time.
The companies surged in 2020 even as the companies were running clinical trials, as investors grew more confident the technology might work. They rose again after the November 2020 trial results showed the jabs apparently prevented 95 percent of Covid infections.
But for a short period in spring 2021, the stocks fell, apparently because investors grew concerned the shots were too effective and would essentially end Covid after the initial two-dose regimen (though the companies were already hinting boosters might be required). As a March 12, 2021, Forbes piece about Pfizer explained:
Pfizer could end up generating more than $15 billion of revenue in 2021 from the vaccine and maybe $4 billion of profits. But… Wall Street doesn’t expect this financial performance will be repeatable.
“That’s it, 15 and next year nothing, this is the value they are giving us,” Bourla says.
Thus shares in the vaccine companies actually peaked later, in late summer 2021, as investors realized the mRNAs did NOT offer durable protection and governments would begin to press boosters, as well as use mandates to force reluctant citizens to take them.
(DO IT. FOR THE CHILDREN! WHICH CHILDREN? THAT’S UP TO YOU.)
Moderna reached an all-time high of $449.38 a share on Sep. 10, just one day after President Biden announced “the time for waiting is over” and said that vaccinations were “not about freedom or personal choice.” At that price, Moderna was among the world’s most valuable drug companies.
But shares fell through the fall, as it became clear that many people who had taken the first two shots were reluctant to accept boosters. They cratered after the Omicron variant arrived in December and it became clear the shots had no or negative efficacy against Omicron infection.
Despite aggressive government and media promotion, fourth and fifth mRNA shots have been rejected worldwide.
(Down goes uptake, down goes uptake, down goes uptake!)
Moderna and BioNTech stocks might be even lower, except that December, Moderna and Merck reported that a Moderna mRNA skin cancer treatment appeared successful in a mid-stage clinical trial when given alongside Merck’s blockbuster cancer drug Keytruda.
The finding suggests mRNA might eventually have some benefit as personalized cancer vaccines. Before Covid, cancer was where researchers expected the mRNAs would first be used.
While the number of cancer patients is far smaller than the number of people who receive vaccines, oncology drugs are now extraordinarily expensive and can generate huge revenues and profits. Last year, Merck sold $21 billion of Keytruda, making it among the world’s biggest selling drugs.
But, at least for now, investors appear skeptical the mRNAs will be more than marginally successful as cancer treatments. Of they won’t have the public health establishment and media hyping them or the government pushing them at Warp Speed, so they will have to go through the normal regulatory process - and that’s always risky.
Shed no tears for executives and scientists at the mRNA companies, though. They sold plenty of stock along the way. Moderna, which is based in Cambridge, Mass., all by itself propped up the Boston real estate market.
Yes, the last three years have turned out to be a textbook example of the most important rule in Big Pharma (or Biotech): the drug doesn’t have to work forever, just long enough for the executives who make it to cash out!