Moderna cuts Covid vaccine sales forecast
Moderna cut its forecast for Covid-19 vaccine sales this year, citing delays in deliveries linked to supply chain constraints.
The US biotech said on Thursday it expected vaccine sales to generate revenues of $18bn-$19bn in 2022, down from a forecast in August of $21bn. This reflects deferrals of orders worth between $2bn-$3bn into 2023, according to the company.
Third-quarter sales were affected by the timing of market authorisations for the company’s bivalent booster — which targets the dominant strain of the Omicron variant — and the related manufacturing increase.
Stéphane Bancel, Moderna’s chief executive, said the company had to deal with very complex manufacturing issues during the quarter. It had to launch two bivalent booster jabs simultaneously following a request by US authorities for the delivery of a booster targeting the BA4/BA5 strain of Omicron.
He said Moderna experienced multiple “pain points” in its supply chain, including short-term issues with contract manufacturers’ handling of filling vials with vaccine. “We are working through those issues . . . there are many lessons to be learned,” he told a conference call.
The group reported vaccine sales of $3.1bn in the third quarter, a decrease of 35 per cent compared with the same period of 2021, and below analysts’ expectations. Its adjusted earnings of $2.53 a share missed analysts estimates of $3.29 a share, according to Refinitiv.
Moderna shares fell as much as 9.1 per cent shortly after Wall Street’s opening bell on Thursday, but recovered ground to break into positive territory.
The company’s downbeat forecast stands in contrast to Pfizer, which earlier this week raised its 2022 sales forecast for its Covid vaccine by $2bn to $34bn, as higher prices offset a slowdown in demand outside the US. But third-quarter revenues fell 6 per cent to $22.6bn compared with the same period last year owing to weaker demand for the jabs.
Still, the forecasts come amid growing evidence of a slowdown in global demand for Covid jabs, as infection levels remain subdued and vaccine hesitancy persists in low and middle-income nations.
Last month the Covax initiative, which supplies the vaccine to the developing world, cancelled its existing contract for the supply of jabs in 2022 from Moderna owing to weak demand. Instead the company will supply up to 100mn doses of its new bivalent booster next year.
In June the EU negotiated a deal with Moderna to adjust its vaccine contract to better meet demand throughout the region. This pushed some deliveries of its new bivalent booster to later in 2022 or early 2023.
Moderna said it had already received Covid vaccine orders worth $4.5bn to $5.5bn for 2023, which includes the $2bn-3bn deferred orders from 2022.
The company said it expected to sign additional deals next year with the US, Japan, Australia and new customers in Asia and Latin America. The company reiterated its desire to sell vaccines to the Chinese government, but said during the conference call there was nothing new to report on that front.
Lee Brown, healthcare analyst at research group Third Bridge, said there appeared to be far less public enthusiasm for the new bivalent booster than expected, which would pile pressure on Moderna.
“As we move more into a post-pandemic environment, Moderna’s heavy dependence on Spikevax places increasing pressure on its pipeline development,” Brown said.
Moderna said in a presentation that demand for Covid jabs in the longer term would track that of influenza vaccines and, depending on price, this could support a market worth up to $32bn annually.