Summary of Moderna, Inc. Conference Call Company Overview - **Company**: Moderna, Inc. (NASDAQ:MRNA) - **Industry**: Biotechnology, specifically focusing on mRNA vaccines and medicines - **Event**: Piper Sandler 36th Annual Healthcare Conference - **Date**: December 5, 2024 Key Points and Arguments Current Position and Market Dynamics - Moderna is recognized as a leading developer of mRNA vaccines and medicines, currently in a strong position with a robust balance sheet and a de-risked mRNA technology platform [2][2] - The company is preparing for several approvals in its late-stage clinical pipeline over the coming years [2][2] COVID-19 Vaccination and Future Products - The company is focused on increasing COVID vaccination rates, particularly among the elderly, who are at higher risk for hospitalization [8][8] - Moderna's next-generation vaccine, mRNA-1283, is expected to have higher efficacy than its previous product, Spikevax, and is aimed at the elderly population [13][14] - The combination vaccine for COVID and flu is anticipated to be crucial in preventing hospitalizations and saving costs [12][12] RSV Vaccine Launch and Market Strategy - Moderna's RSV vaccine, mRESVIA, is entering a market with significant unmet medical needs, particularly for the elderly and pediatric populations [21][22] - The company acknowledges a slower uptake compared to competitors Pfizer and GSK, attributing this to logistical challenges and timing of market entry [31][32] - Future strategies include bundling vaccines to enhance sales and market penetration [34][35] Cytomegalovirus (CMV) Vaccine Development - Moderna is developing a CMV vaccine, which addresses a significant public health issue, particularly in preventing birth defects [36][37] - The CMV vaccine is seen as a potential $2 billion to $5 billion annual market opportunity, with plans to expand its use to pediatric settings [58][58] - The company is preparing educational campaigns targeting OB/GYNs and the general public to raise awareness about CMV and the vaccine [54][56] Safety and Efficacy Considerations - Moderna's RSV vaccine is expected to have a favorable safety profile compared to competitors, as it has not reported cases of Guillain-Barré syndrome in its Phase 3 studies [30][30] - The company emphasizes the importance of data transparency and public health recommendations to encourage vaccination [9][9] Financial Implications - The next-generation COVID vaccine is expected to command a premium price due to its higher efficacy, benefiting both Moderna and retail partners [15][17] - The use of existing manufacturing capacity for the CMV vaccine is projected to yield high gross margins, enhancing the company's financial outlook [60][60] Additional Important Insights - The company is actively working to counter misinformation surrounding vaccines and is committed to transparency in data sharing [9][9] - Moderna's strategy includes leveraging its mRNA technology to create combination vaccines, which could simplify vaccination processes and improve public health outcomes [12][12] - The company is poised to capitalize on the growing demand for vaccines, particularly in the context of respiratory diseases, which are significant health threats in the U.S. [11][11]

ToplineStocks linked to vaccine developers such as Moderna, Pfizer and Novavax tanked in the leadup to market close Thursday, tumbling after reports surfaced that President-elect Donald Trump would select vaccine skeptic Robert F. Kennedy Jr. as the head of the Department of Health and Human Services.Trump announced his pick Thursday afternoon. (Photo by Tom Brenner for The Washington Post via Getty ... [+] Images)The Washington Post via Getty Images Key FactsTrump confirmed his selection of RFK Jr. on Thur ...

Core Viewpoint - Moderna Inc. reported third-quarter revenue of $1.83 billion, exceeding the consensus estimate of $1.25 billion, driven by increased sales in the U.S. market following the launch of the updated COVID-19 vaccine [1] Group 1: Financial Performance - The revenue growth was attributed to higher sales in the U.S. market due to the earlier launch of the updated COVID-19 vaccine [1] - Analysts have adjusted price targets for Moderna, with one reducing it from $110 to $90 based on updated commercial risk expectations and lower sales forecasts for COVID-19 and RSV vaccines [3] - Another analyst lowered the price target from $46 to $38, citing challenges from declining COVID demand and market share loss to Pfizer [4] Group 2: Market Sentiment and Stock Performance - Moderna's stock initially rose but ended lower, likely due to slowing vaccine trends and uncertainty regarding the company's respiratory vaccine lineup [2] - The stock was reported down 6.33% at $47.10 as of the last check [6] Group 3: Future Outlook - Oppenheimer remains optimistic about the long-term potential of Moderna's RSV vaccine, mRESVIA, and believes the company is well-positioned for future growth [5] - The company expects cost of sales to be 40-45% of product sales for the year, with R&D expenses anticipated to be between $4.6 billion and $4.7 billion [6]

Core Insights - Moderna reported $1.86 billion in revenue for Q3 2024, a year-over-year increase of 1.7% and a surprise of +47.73% over the Zacks Consensus Estimate of $1.26 billion [1] - The EPS for the same period was $0.03, a significant improvement from -$1.39 a year ago, with an EPS surprise of +101.59% compared to the consensus estimate of -$1.89 [1] Revenue Breakdown - Product sales in the Rest of the World were $324 million, below the average estimate of $362.69 million, representing a year-over-year decline of -56.3% [3] - Product sales in the United States reached $1.22 billion, exceeding the average estimate of $728.42 million, with a year-over-year increase of +33.1% [3] - Net Product sales totaled $1.82 billion, surpassing the eight-analyst average estimate of $1.22 billion, reflecting a year-over-year change of +3.6% [3] - Other revenue was reported at $42 million, significantly higher than the estimated $16.30 million, but showed a year-over-year decline of -43.2% [3] - Grant revenue within Other revenue was $7 million, slightly below the estimated $8.75 million [3] Stock Performance - Over the past month, Moderna's shares have returned -11.5%, contrasting with the Zacks S&P 500 composite's +4.9% change [4] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [4]

Financial Performance - Moderna reported earnings of 3 cents per share in Q3 2024, significantly better than the Zacks Consensus Estimate of a loss of $1.89 per share and a loss of $9.53 per share in the same period last year [1] - Revenues for the quarter were $1.86 billion, exceeding the Zacks Consensus Estimate of $1.26 billion, with total revenues rising nearly 2% year over year due to higher product sales [1] Stock Market Reaction - Following the earnings report, Moderna's shares increased nearly 8% in pre-market trading, surprising investors who anticipated a loss [2] Product Sales - Product sales increased by 4% year over year to $1.82 billion, primarily driven by higher sales of the COVID-19 vaccine Spikevax in the U.S. [5] - The company recorded $10 million in sales from the recently launched RSV vaccine mResvia, which fell short of the estimated $70 million due to late approval and recommendations [6] Cost Management - Selling, general and administrative (SG&A) expenses decreased by 36% year over year to $281 million, attributed to cost discipline and efficiency improvements [8] - Research & development (R&D) expenses were $1.1 billion, down 2% from the previous year, driven by lower spending on clinical studies [9] Guidance and Future Outlook - Moderna reiterated its product revenue guidance for 2024, expecting sales between $3 billion and $3.5 billion, and adjusted full-year R&D expenses to be between $4.6 billion and $4.7 billion [10] - The company plans to submit three regulatory filings for FDA approval before year-end, including for next-generation COVID-19 and combination vaccines [12] Pipeline Developments - Moderna has over 40 mRNA-based investigational candidates in various clinical stages, including late-stage studies for cancer therapies [14] - The company is co-developing mRNA-4157 with Merck, currently evaluating it in pivotal phase III studies for melanoma and non-small cell lung cancer [15]

Financial Data and Key Metrics - Revenue for Q3 2024 was $1.9 billion, with net income of $13 million [7] - Cash and investments at the end of Q3 2024 totaled $9.2 billion, down from $10.8 billion at the end of Q2 2024 [32] - Operating expenses were reduced by $500 million year-over-year in Q3 2024, excluding a $1.4 billion charge from Q3 2023 [7] - Cost of sales declined by 77% year-over-year to $514 million in Q3 2024, driven by manufacturing productivity improvements [28] - R&D expenses decreased by 2% year-over-year to $1.1 billion in Q3 2024, excluding a priority review voucher purchase [29] - SG&A expenses decreased by 36% year-over-year to $281 million in Q3 2024, reflecting cost efficiency efforts [30] Business Line Performance - Spikevax (COVID-19 vaccine) achieved a 40% market share in the U.S. retail market for the 2024-2025 season [9] - RSV vaccine (mRESVIA) sales were $10 million in Q3 2024, below expectations due to late approval and competitor inventory buildup [14] - The company expects to increase RSV market share in 2025 with full participation in the contracting season and potential label expansion [15] Market Performance - U.S. market contributed $1.2 billion in product sales in Q3 2024, driven by an earlier vaccine launch and a $140 million provision release [23] - International sales were $0.6 billion in Q3 2024, in line with expectations but lower than the same period in 2023 [25] - The company expects Q4 2024 U.S. product sales to range between $200 million and $500 million, and international sales between $600 million and $800 million [25][27] Strategy and Industry Competition - The company aims to drive COVID vaccination rates closer to flu vaccination rates, particularly in under-penetrated channels like IDNs and government programs [11][13] - Moderna is focusing on educating healthcare providers and consumers about the benefits of COVID vaccination, including reducing the risk of long COVID [12][13] - The company plans to expand its manufacturing footprint in the U.K., Canada, and Australia in 2025 to fulfill multi-year contracts [53] Management Commentary on Operating Environment and Future Outlook - The COVID market is expected to remain a sizable and durable long-term market, with Moderna well-positioned to capture growth [9] - The company is optimistic about the potential for RSV market expansion, particularly with international approvals and potential revaccination recommendations [15] - Moderna is committed to improving cost efficiencies, with a goal to reduce annual R&D expenses by $1.1 billion by 2027 [55] Other Important Information - The company expanded its executive committee, promoting internal talent and emphasizing the integration of digital technology and AI [18][19] - Moderna expects to file for approval of three products in 2024: next-gen COVID vaccine, RSV vaccine for high-risk individuals, and a combination COVID-flu vaccine [54] Q&A Session Summary Question: Rest of world revenue and CMV interim analysis [58] - Rest of world revenue in Q3 2024 was driven by orders from the U.K., Canada, Australia, and Brazil, with most of the $600 million in Q4 expected from contracted volumes [59][60] - For CMV, if the DSMB recommends un-blinding at the interim analysis, the company will share the results; otherwise, it will wait for the final analysis [61] Question: Ex-U.S. COVID revenue contracts and CMV accrual timing [63] - The company has multi-year contracts with some countries, with revenue expected to decline in 2025 before increasing in 2026 [65] - CMV case accrual is steady, and the final analysis could happen quickly after the interim analysis [66] Question: U.S. pricing, reserve returns, and flu-COVID combo [69] - U.S. pricing for COVID vaccines is approximately $63 per dose, and reserve returns for the 2023-2024 season were adjusted to $400 million [70][75] - The company decided not to use a priority review voucher for the flu-COVID combo due to timing constraints, with potential approval in 2025 [71][72] Question: RSV market dynamics and COVID market share [78][107] - The RSV market has been slower than expected, with inventory buildup and delayed CDC guidelines impacting sales [81][82] - Moderna lost some market share in the U.S. retail COVID market but expects to gain a clearer picture of overall market share by the end of the season [108] Question: INT program and manufacturing [90] - The INT manufacturing facility in Massachusetts is on track for completion by year-end, with no bridging work required for FDA approval [91][92] Question: Election impact and RSV international expansion [94] - The company is confident in its ability to work with any administration to advance public health goals [96] - RSV market expansion outside the U.S. is expected to grow, but timing depends on regulatory approvals and pricing negotiations [97][98] Question: Orphan disease pipeline [102] - Pivotal trials for MMA and PA are expected to start in 2025, with potential launches in 2026 or later, depending on enrollment and trial progress [103][104] Question: Flu-COVID combo transition and COVID litigation [118] - The flu-COVID combo is not expected to transition the market in 2025 due to contracting timing, with potential impact in 2026 [119][120] - The company is prepared to defend against GSK's lawsuit, which is common during market formation around new technologies [122]

Group 1: Jobless Claims - Initial Jobless Claims for last week were reported at +221K, slightly above expectations and the revised +218K from the previous week, indicating a stable employment picture [2] - Continuing Claims reached 1.892 million, close to the 1.9 million mark, with the previous week's figure revised down from 1.86 million to 1.853 million, suggesting a tightening in longer-term claims [3] Group 2: Earnings Reports - UnderArmour (UAA) reported earnings of 30 cents per share, exceeding the 19-cent estimate, resulting in a +57.9% positive surprise, with revenues of $1.4 billion slightly above expectations [4] - Moderna (MRNA) achieved a positive earnings per share of +$0.03, a significant surprise compared to the estimated -$1.89, with revenues of $1.86 billion, +47.7% above estimates [5] - Planet Fitness (PLNT) posted earnings of 64 cents per share, surpassing the expected 58 cents, and revenues of $292.25 million, +3% above estimates, contributing to a +7.5% increase in shares [6] Group 3: Market Expectations - The Federal Open Market Committee (FOMC) is expected to announce a 25 basis points cut in the Fed funds rate, bringing it to 4.50-4.75%, the lowest since March 2023 [8]

Economic Indicators - Initial Jobless Claims increased to 221K, slightly above expectations and the previous week's revised figure of 218K, indicating a stable employment picture [2] - Continuing Claims rose to 1.892 million, nearing the 1.9 million mark, with the previous week's figure revised down to 1.853 million, suggesting a tightening in longer-term claims [3] Earnings Reports - UnderArmour (UAA) reported earnings of 30 cents per share, exceeding the 19-cent estimate, resulting in a 57.9% positive surprise, with revenues of $1.4 billion slightly above expectations [4] - Moderna (MRNA) achieved a positive earnings per share of $0.03, a significant surprise compared to the estimated loss of $1.89, with revenues of $1.86 billion, 47.7% above estimates [5] - Planet Fitness (PLNT) posted earnings of 64 cents per share, surpassing the expected 58 cents, with revenues of $292.25 million, 3% above estimates [6] Market Expectations - The Federal Open Market Committee (FOMC) is expected to announce a 25 basis points cut in the Fed funds rate, bringing it to a range of 4.50-4.75%, the lowest since March 2023 [8]

Core Viewpoint - Moderna's stock has experienced a significant decline of 48% this year, but a rebound is anticipated following a strong Q3 performance, with revenue of $1.86 billion and adjusted earnings of $0.03 per share, surpassing consensus estimates [1] Group 1: Financial Performance - The company reported a revenue of $1.86 billion in Q3, exceeding the consensus estimate of $1.25 billion [1] - Adjusted earnings were $0.03 per share, compared to a consensus loss estimate of $1.90 per share [1] - Revenue for 2023 is projected to decline by 64% year-over-year to $6.8 billion, with expectations of further decline to approximately $3.5 billion in 2024 [1] Group 2: Product Pipeline and Innovations - Moderna has a robust pipeline with around 45 products in development, with nearly 25% expected to be commercialized in the next three to four years [4] - The new RSV vaccine is anticipated to gain traction due to its advantages, including easier storage and administration, and no reported cases of Guillain-Barré syndrome [2] - Recent clinical trials for the skin cancer vaccine show promising results, with a 44% reduction in recurrence or death compared to Merck's Keytruda alone [3] Group 3: Cost Management and Financial Health - The company has implemented cost-cutting initiatives aimed at saving $1.1 billion over the next three years, which is expected to enhance profitability [4] - Moderna holds $9.2 billion in cash, providing potential for acquisitions in the biotech sector [4] Group 4: Market Position and Analyst Outlook - Despite recent volatility, with annual returns of 143% in 2021, -29% in 2022, and -45% in 2023, analysts suggest that Moderna's stock is undervalued at around $50, with an average price estimate of $91 indicating an 80% upside [5][6] - The stock's performance has been more volatile compared to the S&P 500, raising questions about its future performance in the current macroeconomic environment [5][6]

Core Viewpoint - Moderna Inc reported better-than-expected third-quarter sales, with revenue of $1.83 billion, surpassing the consensus estimate of $1.25 billion, attributed to higher U.S. sales following the earlier launch of the updated COVID-19 vaccine [1][2]. Financial Performance - Third-quarter revenue was $1.83 billion, unchanged from the previous year, but exceeded expectations [1]. - Earnings per share was $0.03, a significant improvement from a loss of $(9.53) in the same quarter last year, compared to a consensus loss of $(1.90) [3]. Product Sales - Spikevax sales in the third quarter reached $1.8 billion, with $1.2 billion from U.S. sales and $0.6 billion from international sales [2]. - mRESVIA (RSV vaccine) sales were reported at $10 million, lower than anticipated due to late approval and recommendation [4]. Future Guidance - The company reiterated its expected net product sales for 2024 from its respiratory franchise to be between $3.0 billion and $3.5 billion [5]. - Cost of sales is expected to be 40-45% of product sales, with R&D expenses anticipated to be $4.6 billion to $4.7 billion [5]. - Moderna plans to file for approval of its next-generation COVID-19 vaccine and RSV vaccine in 2024 for high-risk adults aged 18-59 [5]. Market Reaction - MRNA stock increased by 7.04% to $55.46 during the premarket session following the earnings report [6].