What To Expect As Moderna’s Covid-19 Vaccine Moves To Phase 3 Trials

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[Updated 7/28/2020] Moderna Begins Phase 3 Trials

Moderna (NASDAQ: MRNA) announced that it has started phase 3 trials of its Covid-19 vaccine candidate mRNA-1273 in collaboration with two U.S. government agencies.  These trials will determine if the vaccine protects against Covid-19 and whether it will be cleared for use in the general public. Patients who recover from Covid-19 generate antibodies that help to prevent re-infection and per interim data from its phase 1 trials that involved 45 people, Moderna said that the people inoculated with the vaccine generated antibodies that were 4x compared to people who’d recovered from Covid. The phase 3 trial will help to validate this at a larger scale and is expected to enroll 30,000 participants in the U.S.

See our Theme of Covid-19 Vaccine Stocks for an overview of U.S. listed companies working on Covid-19 vaccines and their financial performance and returns.

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Separately, Moderna also said that the federal government has committed $472 million in funding to help the clinical development and production scale-up for its vaccine. This is in addition to the $483 million in funding it secured from the government in April.

While Moderna was seen as one of the leaders in the vaccine race, rivals are also catching up quickly. On Monday, Pfizer and its German partner BioNTech indicated that they also started late-stage trials for their Covid-19 vaccine, which could involve up to 30,000 participants. Pfizer’s vast resources, better access to manufacturing, and distribution could give it an edge over Moderna as it continues to move forward.

Larger pharma companies could offer better downside protection compared to Moderna if you’re looking to gain exposure to a Covid-19 vaccine stock. Should you pick Johnson & Johnson Or Pfizer For Better Returns?

[Updated 7/21/2020] Does Oxford-AstraZeneca’s Progress With Covid-19 Vaccine Impact Moderna? 

While Moderna (NASDAQ: MRNA) was viewed as a front-runner in the race for a Covid-19 vaccine, competition is mounting. On Monday, Oxford University, which is developing a Covid-19 vaccine candidate along with AstraZeneca, published some positive data on phase 1/2 trials, indicating that the vaccine was tolerated and generated a robust immune response. [1]  This comes about a week after Moderna released similar progress on its Covid-19 vaccine candidate mRNA-1273. So how do the Moderna and Oxford-AstraZeneca vaccines’ developments compare?

Clinical Trial Timeline: Oxford and AstraZeneca have been combining the stages of their clinical trials and are carrying out late-stage phase 2/3 trials in the UK, Brazil, and South Africa. In comparison, Moderna is expected to start its phase 3 trial with around 30k participants in late July. Overall, the two companies appear to be roughly at the same stages in the clinical timeline.

Manufacturing & Distribution: AstraZeneca could have an edge over Moderna when it comes to manufacturing and distribution. The company has partners to manufacture and distribute about 2 billion doses of its experimental Covid-19 vaccine. The company has an agreement with the Serum Institute of India, which is the world’s largest vaccine manufacturer. In comparison, Moderna’s collaboration with Swiss biotech company Lonza could enable it to produce as much as one billion doses per year.

Potential Pricing: AstraZeneca has said that it would make the vaccine available globally on a non-profit basis, through the course of the current pandemic. This means that the vaccine, if approved, should be relatively affordable. This could at least initially limit the pricing power for a potential Moderna vaccine. This would be a real concern for Moderna investors, who have bid the stock up 4x this year, in anticipation of potential profits from the vaccine candidate.

Did you know that the U.S. government awarded biotech company Novavax $1.6 billion toward the development of its Covid-19 vaccine? Does this make Novavax a better bet that Moderna? Find out in our analysis Trefis Theme: Covid-19 Vaccine Portfolio 

[Updated 7/14/2020] Moderna’s Promising New Data On Phase 1, Inclusion Into Nasdaq Index.

Moderna (NASDAQ: MRNA) stock has jumped by almost 40% over the last two days (including after-hours trading Tuesday), driven by two positive developments. Firstly, on Monday, the Nasdaq indicated that the Moderna would be included as a component of the Nasdaq-100 index starting from July 20th. [2] While this does not change the fundamental picture for Moderna, index funds that track the Nasdaq will start buying the stock, bidding up the stock price in the near-term. As passive investing is gaining momentum, this could generally increase demand for Moderna stock.

Secondly, on Tuesday, Moderna released more details on the phase 1 trial of its Covid-19 vaccine candidate mRNA-1273, noting that it was generally safe and well-tolerated and produced immune responses in trial participants. [3] More specifically, after two doses, the vaccine produced neutralizing antibodies – which are key to fighting the virus –  that were 4x higher than what was found in patients who had recovered from coronavirus infections. Moderna is looking to start phase 3 trials for the vaccine this month and has indicated that it could have data from the study by Thanksgiving.

[Updated 7/6/2020] The Recent Moderna Selloff 

Moderna (NASDAQ: MRNA) stock has declined by close to 10% over the last two trading days. There are a couple of developments that could be putting pressure on the stock.

Firstly, the competition could be gaining some ground in the vaccine race. German biotech player BioNTech and Pfizer (NYSE:PFE) who are collaborating on a Covid-19 vaccine, released encouraging preliminary early-stage data on their vaccine candidate noting that it was well-tolerated and that it generated significant levels of antibodies in people. Pfizer’s vaccine is now roughly in the same stage as Moderna’s in the clinical trial timeline, with the company making plans for Phase 3 trails. [4] Pfizer’s vast resources, better access to manufacturing, and distribution could give it an edge over Moderna as it continues to move forward.

Secondly, there are some concerns regarding the timeline for the potential approval of Moderna’s vaccine. Earlier this week, the FDA provided guidelines for the approval of  Covid-19 vaccines, indicating that it would not be relaxing any standards. The FDA said that a Covid-19 vaccine would need to show at least 50% efficacy in a placebo-controlled clinical trial while also spelling out other requirements. This could potentially delay the approval process for Moderna. Separately, there was also a report that Moderna was delaying the start of its Phase 3 trials, although this was denied by the company.

Larger pharma companies could offer better downside protection compared to Moderna if you’re looking to gain exposure to a Covid-19 vaccine stock. Should you pick Johnson & Johnson Or Pfizer For Better Returns?

[Updated 6/25/2020] Where Do Key Vaccine Efforts Stand Currently?

Moderna (NASDAQ: MRNA) is seen as the front-runner in the race to develop a Covid-19 vaccine. The clinical-stage biotech company has phase 2 trials underway for its vaccine candidate mRNA-1273 and is expected to commence phase 3 trials in July, in collaboration with the U.S. National Institutes of Health. CEO Stephane Bancel recently estimated the probability of success of the vaccine at close to 80% to 90%, citing the effectiveness of the company’s RNA based platform on other viruses such as MERS, Zika, and Cytomegalovirus. [5]

German biotech company BioNTech is working on a Covid-19 vaccine in partnership with Pfizer (NYSE: PFE). While the development uses messenger RNA technology similar to Moderna, this effort focuses on not just one, but four prototypes. The vaccine is in phase 1/2 clinical trials in the U.S. and Germany and the first set of results from the studies are likely to be available in the coming weeks. [6] There is also a possibility that phase 3 trials could begin as early as July, per the Wall Street Journal. [7]

Pharma bellwether Johnson & Johnson’s (NYSE:JNJ) vaccine is expected to start phase 1/2a trials over the second half of July. This is ahead of the company’s initial timeline of September. The company could have a leg up over rivals in terms of production capacity and distribution reach and has indicated that it aims to supply over one billion doses globally through the course of 2021 if the vaccine proves safe and effective.

Did you know Moderna stock is up over 3x this year, while BioNTech is up 40% driven by progress on Covid-19 vaccines? In comparison, Johnson and Johnson and Pfizer are down year-t0-date. Which stocks offer a better risk to reward profile? Find out more in the Trefis Theme: Coronavirus Vaccine which details key financial, valuation, and returns metrics for the companies.

[Updated 6/12/2020] What To Expect As Moderna Plans Phase 3 Trials

Moderna (NASDAQ: MRNA) has outlined plans for phase 3 clinical trials for its Covid-19 vaccine candidate mRNA-1273, which will begin in July and is expected to include about 30,000 participants. Phase 3 trials will primarily study the efficacy of the vaccine in preventing symptomatic Covid-19 disease and secondarily, the prevention of severe cases of Covid-19 which require hospitalization. [8] Moderna also provided an update on its phase 2 trials which are currently underway, noting that it had enrolled 350 out of its total planned 600 participants for the study.

Moderna also said that it is on track to deliver roughly 500 million doses of the vaccine per year, and potentially up to 1 billion doses annually, starting from 2021, leveraging its internal U.S. manufacturing site as well as a strategic collaboration with Lonza, a Swiss biotech company. Overall, the pharma industry is moving much faster than expected with Covid-19 vaccine development. For perspective, each phase of a vaccine development typically takes multiple years and per a 2013 study, the total development time for the average vaccine was close to 11 years. [9]

Did you know that Johnson & Johnson (NYSE:JNJ) will begin human trials of its Covid-19 vaccine over the second half of July, well ahead of its previous timeline of September? J&J may also offer downside protection versus clinical-stage biotechs like Moderna, given its diversified revenue streams. Find out more in our dashboard analysis Johnson & Johnson Valuation: Expensive Or Cheap?

[Updated 6/2/2020] Moderna Moves To Crucial Phase 2 Trials

Moderna said that it commenced stage 2 trials for its new Coronavirus vaccine candidate mRNA-1273 last week. The company intends to enroll a total of 600 participants in the study, up from 45 participants in the phase 1 study. However, the trials should be quicker, as Moderna said it is looking to start phase 3 trials by July. Phase 2 trials may be viewed as more crucial compared to other phases for a couple of reasons. While phase 1 trials are used to ascertain the safety of a vaccine or treatment in humans, phase 2 trials gauge the effectiveness and also provide more data on how safe it is.  Additionally, the progression from phase 2 to phase 3 may be more tricky for pharma companies. Based on historical data, the probability of success (POS) for a drug moving from phase 1 of clinical trials to phase 2 stands at about 63%, while the metric is sharply lower at 31% for phase 2 to phase 3 progression. For phase 3 to the new drug application – a stage just before approval – the POS stands at 58%.

What does Moderna’s Pipeline Beyond The Covid-19 Vaccine look like? Good to know, given that the stock is up 3x this year, driven largely by the Coronavirus, meaning that the downside risk could also be considerable.

[Updated 5/15/2020] Moderna’s Recent Progress

Moderna has made significant progress with its Coronavirus vaccine candidate – mRNA-1273 – in recent weeks, as it gained FDA approval to begin phase 2 clinical trials while noting that it was finalizing the protocol for a phase 3 study, which is expected to begin early summer. This is ahead of the fall timeline previously anticipated for phase 3 trials. Separately the experimental vaccine has also received fast-track designation from the U.S. FDA, essentially helping to speed up the regulatory process. At this rate, the company could be on track to win full approval for the vaccine by next year. This puts Moderna well ahead of rivals in the clinical trial timeline – rival biotech Inovio’s candidate is in phase 1, while many other U.S. based players remain in the pre-clinical phase. Moderna has also announced a collaboration with Switzerland based Lonza Group for manufacturing its vaccine, producing as much as 1 billion doses each year.

Our indicative list of 7 U.S. listed companies working on Coronavirys vaccines, which includes Moderna, Inovio and others have returned 200% YTD return on an equally weighted basis. For more details on these stocks and their financials, view Trefis Theme: Coronavirus Vaccine Portfolio

[Updated 4/23/2020] An Overview of  Coronavirus Vaccine Stocks

While the markets have tumbled due to the spread of the novel coronavirus, stocks of pharma companies developing vaccines and treatments for the highly contagious viral infection have fared well. Although vaccine bets still remain quite speculative, considering that most companies are either in the pre-clinical or phase 1 stage of trials for their candidates, companies could see significant upside if they develop a safe, effective, and relatively affordable vaccine. For instance, the potential addressable market for a vaccine could stand at 7.5+ billion (the worldwide population) versus ~2.5 million currently for potential coronavirus therapeutics. Our indicative portfolio of 7 U.S. listed companies developing vaccines for Coronavirus has gained a whopping ~130% year-to-date on an equally weighted basis.

While the stocks of smaller, specialized players such as Inovio Pharmaceuticals and Moderna have rallied by ~250% and ~160% respectively year to date, as both companies already have candidates in Phase 1 trials, these companies also have a much higher risk, given their very limited revenue streams. On the other hand, big pharma companies such as Johnson & Johnson (up 5% year to date) and Sanofi (down 4%), who remain in the pre-clinical stage, could offer better downside protection, given their highly diversified revenue streams. For more details on the stock price and fundamental performance of some of the key U.S. listed companies developing a coronavirus vaccine, view our  COVID Vaccine Portfolio

Moderna (+160% YTD return, $16.8 billion market cap): Moderna was the first to begin phase 1 clinical trials for its RNA-based vaccine. The company is expected to receive as much as $483 million in U.S. federal government funding for its vaccine development. Moderna says that it could begin phase 2 trials as early as Spring 2020, with phase 3 trials potentially starting as early as the Fall.

Inovio Pharmaceuticals (+255% YTD return, $1.7 billion market cap): Inovio, a small biotech company started phase 1 clinical trial for a DNA-based novel coronavirus vaccine earlier this month. While the company is ahead of larger firms in getting to human trials for its vaccine candidate, it could remain a speculative bet for investors, given its relatively limited revenue streams (just $4 million in revenue over 2019).

Novavax (440% YTD return, $1.1 billion market cap): Novavax, a company that focuses on vaccines for infectious diseases, has indicated that it has a vaccine candidate called NVX-CoV2373 that has demonstrated effectiveness against the coronavirus in pre-clinical trials. That said, the stock could have significant downside risk as well, as the company does not have any other products in the market, besides a flu vaccine that is in the late stages of development.

Johnson & Johnson (+5% YTD return, $390 billion market cap): The pharmaceutical giant could begin phase 1 trials for its coronavirus vaccine by September 2020, at the latest. The company could have a leg up over rivals in terms of production capacity and distribution reach, as it says it would be able to produce as much as 900 million doses by early 2021. Moreover, the company is also working on antiviral treatments against the coronavirus.

Sanofi (-4% YTD return, $120 billion market cap): Sanofi has joined forces with GlaxoSmithKline to develop a coronavirus vaccine. While Sanofi will contribute the antigen, GSK will provide its pandemic adjuvant technology, which helps to reduce the amount of vaccine protein required per dose. Sanofi also has exposure to potential COVID-19 treatments, as the company makes the malaria drug hydroxychloroquine, which is being viewed as a possible treatment, while also testing another treatment in partnership with Regeneron.

Are treatments, vaccines or testing stocks the best way to play the coronavirus recovery? View our indicative themes Coronavirus Treatment Stocks, and Coronavirus Testing Stocks for more details on the stock price and fundamental performance of some of the key U.S. listed companies.

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Notes:
  1. Press Release, AstraZeneca []
  2. Moderna, Inc. to Join the NASDAQ-100 Index Beginning July 20, 2020, Global News Wire, July 13, 2020 []
  3. Moderna Announces Publication in The New England Journal of Medicine of Interim Results From Phase 1 Study of Its mRNA Vaccine Against COVID-19, Moderna, July 14, 2020 []
  4. PFIZER ANNOUNCES START OF FOUR PHASE 3 CLINICAL TRIALS FOR INVESTIGATIONAL VACCINES, Pfizer Press Release, June 2020 []
  5. Moderna CEO sees ‘high probability’ of success with Covid-19 vaccine, CNBC, June 2020 []
  6. Biopharma Drive, June 2020 []
  7. Coronavirus Vaccine Candidates’ Pivotal U.S. Testing to Start This Summer, WSJ, June 2020 []
  8. Moderna Press Release []
  9. Why it’ll still be a long time before we get a coronavirus vaccine, New Scientist, April 2020 []