Moderna Dives as 2021 Vaccine Forecast Cut, Revenue Misses

(Bloomberg) -- Moderna Inc. jolted the market with sales and earnings that badly missed analysts’ estimates as it lowered its forecast for 2021 Covid-19 vaccine sales, a third-quarter performance that put it further behind vaccine rivals Pfizer Inc. and BioNTech SE.

Moderna shares slid as much as 17% as of 9:32 a.m. in New York, the most intraday since August, after it said vaccine sales would be between $15 billion and $18 billion in 2021. Previously, the company had said it had signed agreements for $20 billion in anticipated 2021 sales of its shots. 

The company also lowered its vaccine production forecast for this year to between 700 million and 800 million doses, at the full 100 microgram dose used for the initial two-shot regimen. 

Moderna has struggled to shift from its mostly domestic vaccine business in the first half of the year, when U.S. goverment purchases gobbled up most of its initial vaccine supply, to delivering vaccines to far-flung international locales. Third-quarter vaccine deliveries barely rose to 208 million doses, as the bulk went abroad, compared to 199 million doses in the second quarter, when almost two-thirds of the doses went to the U.S.

‘Teething Problems’

Longer lead times for international orders may shift some deliveries into 2022, Moderna said in a statement. The company cited a “temporary impact” as it attempts to expand its capacity to fill and finish vaccine vials.

Chief Executive Officer Stephane Bancel compared the biotech’s supply issues to “teething problems.”

“The complexity is just increasing,” he said on a conference call with analysts. 

Moderna is looking more like a runner-up in the race with Pfizer and BioNTech to lock in orders for Covid booster shots for next year. Earlier this week, Pfizer raised its full-year 2021 forecast for Covid vaccine sales to $36 billion and said it expected to sell $29 billion worth of the partners’ vaccine in 2022.  

Moderna also said its board of directors had authorized a share buyback program of up to $1 billion over a two-year period.

Investors are likely to see 2022 as the peak for Covid-19 vaccine revenue as the rollout of the original regimens expands to boosters and now the roll-out of injections for children, said Jared Holz, a health-care strategist with Oppenheimer & Co.

“It may be too soon to call this trade completely over,” he said in a note to clients, “as the pandemic has clearly evaded even the most educated of expert understanding at times.”

Myocarditis Findings

Moderna reported third-quarter revenue of $5 billion and diluted earnings per share of $7.70, well below analyst expectations. Not all the news was bad: Moderna said it now has $17 billion of signed vaccine orders for 2022, and expects sales in the range of $17 billion to $22 billion.  

While well below Pfizer’s Covid sales forecast, that would still make Moderna’s vaccine one of the best selling drug products in the world next year. The company also reported that a trial showed its vaccine for children 6 to 11 years old was 100% effective two weeks after the first 50 milligram dose was administered. 

However, earlier this week, Moderna faced a setback in getting its vaccine for 12- to 17-year-olds to the U.S. market. Regulators said they needed more time to examine the risk of myocarditis, a rare form of heart inflammation linked to the vaccine, before deciding on clearing it for that age group. On a conference call, Moderna said its own safety database of 1.5 million individuals under 18 showed no increased heart inflammation risk.

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