Moderna Is Now More Valued Than Gilead, GlaxoSmithKline: How Long Did COVID-19 Vaccine Maker Take To Hit $100B?


Moderna Inc MRNA stock is on a roll, with its vaccine-induced momentum spilling over into 2021.

The Massachusetts-based company, which had a modest beginning as a tiny biotech startup, has come a long way and is now the 13th most-valued U.S.-listed biopharma.

It has come from behind to top the valuations of industry giants like GlaxoSmithKline pls GSK and Gilead, Inc. GILD, which were valued at just under $100 billion and $85.5 billion, respectively, at press time.

Moderna's Modest Beginnings: Founded in 2010 by Flagship Pioneering, Moderna set out to develop and commercialize a new category of drugs to treat diseases. A trio of Harvard Med School academics joined Noubar Afeyan, the founder, to launch the company.

CEO Stéphane Bancel took over the reins of the company in 2011 and Afeyan continues to serve as chairman of the board.

Moderna's Technology: Moderna's drugs are based on messenger RNA, or mRNA, which it terms the "software of life."

The mRNA transfers the instructions stored in DNA to make the proteins required for a living cell. The company uses mRNA medicines to instruct a patient's own cells to produce proteins that can potentially prevent, treat or cure diseases.

Moderna's pipeline consists of 24 development programs, with 13 of them having entered the clinic.

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Moderna's Ticket To Success: Moderna, which was a clinical-stage biopharma until last year, transformed into a commercial-stage company following the Food and Drug Administration granting emergency use authorization for its COVID-19 vaccine, codenamed mRNA-1273.

The company struck gold with the vaccine. Given that it was the second to be authorized after the Pfizer, Inc. PFE-BioNTech SE BNTX vaccine, the company benefited from an early mover advantage.

Moderna initiated the COVID-19 vaccine program as early as January 2020 in collaboration with the NIH, and by Dec. 18, 2020, the company succeeded in getting clearance from the FDA for emergency use.

Primary analysis from a late-stage study of the vaccine released in late November showed 94.1% vaccine efficacy. In June, the company applied to the FDA for full approval.

The vaccine has also been authorized by the European Union, the U.K., Canada, Israel and other entities. 

Moderna's Vaccine A Commercial Success: The mRNA-1273 vaccine fetched revenues of $199.87 million for the company in the fourth quarter. Revenues from the vaccine ballooned to $1.7 billion in the March quarter.

In early May, Moderna said in its first-quarter release that it has signed advance purchase agreements for scheduled delivery in 2021 for a total of $19.2 billion.

Moderna's Wall Street Debut, Pandemic Rally: Moderna went public in late 2018 by offering 26.28 million shares at a price of $23 each.

The shares debuted on the Nasdaq on Dec. 7, 2018 and ended at $18.60, 19% lower than the IPO price.

Moderna's stock was largely rangebound until February 2020. Subsequently, each update regarding its COVID-19 program sent the stock soaring.

The stock hit the triple-digit mark in mid-November and ended 2020 with a gain of 434%.

A strong vaccine order flow and positive clinical updates on the vaccine against variants as well as expansion of label kept the stock vibrant in 2021. Thus far, in 2021, the stock is up about 125%.

Since listing, it has taken about two years and seven months for Moderna's stock to hit a $100-billion market capitalization.

The Way Forward For Moderna: Even as the U.S. coronavirus vaccine market is no longer supply constrained, there has been growing global interest in mRNA platforms as delays and safety concerns have emerged for other modalities, Chardan analyst Geulah Livshits said in a note, citing the management.

A full approval, according to SVB Leerink analyst Mani Foroohar, may increase the uptake of Moderna's vaccine, as the company would be allowed to do marketing and educational activities.

As COVID-19 enters an endemic setting, the company plans to use the excess manufacturing capacity for the production of other pipeline products. The company can leverage on its success with its COVID-19 vaccine to pursue other pipeline candidates and bring them to fruition.

Moderna shares gained 5.28% Thursday, closing at $259.68. 

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