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“Now I’m free—free fallin’!” Moderna’s earnings projections just took a Tom Petty dive, and investors are wondering when the parachute will open.
Moderna executives slashed the year’s projected net sales on Thursday from around $4 billion to between $3 billion and $3.5 billion, due in part to declining interest in the Covid-19 vaccine.
In Moderna’s Q2 earnings call, CFO Jamey Mock said the company expects lower uptake of its respiratory syncytial virus (RSV) vaccine, low European sales of its Covid-19 vaccine, and a low Covid vaccine rate in the US around what the company saw last season when CDC data showed that only around 21% of adults had received the updated booster.
“This year is not turning out as we expected,” Mock said in the call.
Total revenue this quarter was $241 million, compared to $344 million in Q2 2023, a decline attributed to lower Covid vaccine sales, according to a press release. Sales for Spikevax, the company’s Covid vaccine, fell to $184 million, a 37% YoY decrease from 2023, which saw $293 million. The release said this was due to its shift into a seasonal vaccine market.
Moderna created an updated 2024–25 Covid vaccine that has received US regulatory approval and is set to be rolled out alongside vaccines from Pfizer and Novavax this fall. The CDC recommends everyone six months and older get the updated shot, but booster vaccine rates have remained low despite recent increases in hospitalizations.
The FDA also approved a new vaccine from Moderna that targets RSV on May 31, but the company was late to the party. Pfizer and GSK released RSV shots last year, and Moderna is struggling to stand out from the competition.
Moderna CEO Stéphane Bancel lamented “larger competitors with a portfolio of products” in the Covid and RSV vaccine sphere can be “more aggressive on activities, whether it’s supply chain, whether it’s pricing, whether it’s co-marketing funding and dollars activity.”
Pfizer prevails. Pfizer, Moderna’s main Covid vaccine competitor, also reported a drop in sales of Covid products this week. But the company increased its projected annual sales because other products, such as its rare heart disease drug Vyndaqel, have been doing very well.
Pfizer also has a contract that commits European Union (EU) countries to buying large amounts of its Covid vaccine through 2026. Though Moderna supplied the EU with shots during the pandemic, the region will seemingly have more than enough shots from Pfizer going forward, leading Bancel to predict low sales there during the earnings call.
While there are more products in Moderna’s pipeline, such as a dual Covid and flu vaccine and an oncology therapeutic, both of which are in late-stage trials, it’s going to be an “all hands on deck” effort to get sales up for the company’s Covid and RSV products, Bancel said.