Will Moderna come away with 50% more than Pfizer for its coronavirus vaccine?


We now have a pretty good idea of ​​the cost of COVID-19 vaccines to Uncle Sam. Last week the US government announced an agreement with Pfizer (NYSE: PFE) and BioNTech (NASDAQ: BNTX) to buy 100 million doses of the two partners’ main coronavirus vaccine candidate for $ 1.95 billion. This translates into a price of $ 19.50 per dose.

More Modern (NASDAQ: ARNM) plans to price its COVID-19 vaccine more than 50% higher than Pfizer’s price for its vaccine, according to a report from the Financial Times. Can Moderna get away with such a high price tag?

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Rumor has it…

the Financial Times reported that anonymous sources said Moderna intends to research a price between $ 50 and $ 60 per course for its COVID-19 vaccine candidate, mRNA-1273. Each course includes two doses, so that range translates into a price per dose of $ 25 to $ 30.

However, Moderna apparently intends to try to get this price only for the United States and other countries with larger savings. It is not known what price biotechnology will seek for its coronavirus vaccine in developing countries.

Keep in mind, however, that at this point all we have to do is pursue the anonymous sources cited by the Financial Times. Moderna has not officially revealed the price it hopes to obtain for mRNA-1273. The company is in talks with various governments on possible supply agreements.

There is also another important caveat regardless of the price Moderna charges for mRNA-1273: the vaccine must first obtain regulatory approvals (or at least receive emergency use authorization for the drug. FDA). Moderna launched its Phase 3 mRNA-1273 study last week. It will take at least a few months before the results of this study are available.


It’s no surprise that there was an almost immediate backlash against Moderna’s reported price bracket for mRNA-1273. The main reason biotech has caught the flak is that the U.S. government has invested a lot of money in Moderna’s COVID-19 vaccine program.

In April, the Biomedical Advanced Research and Development Authority (BARDA) granted up to $ 483 million to Moderna to advance the development of mRNA-1273. Last month, BARDA added additional funding of $ 472 million for Moderna’s COVID-19 vaccination program.

This represents a total of $ 955 million in federal funding commitments that Moderna has received so far. Still, the company would like to charge up to 50% more for its coronavirus vaccine than Pfizer is receiving – and Pfizer hasn’t taken all government money to develop its vaccine.

If you think this has caused some fury in Washington, you are right. Representative Jan Schakowsky (D-Illinois) issued a statement to Barron’s who accused Moderna of “thinking about how to [its] Federal funding in exorbitant profits. If Moderna increases the dose in the US by $ 30, you can bet the controversy will only intensify.

Follow the laws

But back to our original question: Can Moderna afford to top up so much more than Pfizer? The answer is maybe.

Consider this Sanofi and GlaxoSmithKline will receive up to $ 2.1 billion from the U.S. government to develop its COVID-19 vaccine candidate and deliver 100 million doses. At first glance, it might appear that both drugmakers will make $ 21 per dose. However, since some of the funding targets make it easier for clinical trials and scale to manufacture, the actual price per dose is even higher. It might even be in the range Moderna is looking for.

The bottom line is that the price of the coronavirus vaccine will almost certainly follow the laws of supply and demand. Moderna’s mRNA-1273 is one of only six COVID-19 vaccine candidates in advanced testing. Three of those six products are in development by Chinese drug makers, and they are highly unlikely to win any supply deals in the United States.

Moderna’s clinical results from previous studies make mRNA-1273 particularly promising. With the ability to deliver vaccines below what will be needed globally and the virtual certainty of high demand as the pandemic continues, Moderna may well be able to get $ 30 per dose or so.

If it can do that, Moderna would only have to sign agreements to deliver 500 million doses worldwide at that price and generate $ 15 billion in revenue. It seems achievable. And that’s why the biotech stock could rise again after climbing nearly 300% so far this year.


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