The majority of its revenue comes from sales of vaccines and therapeutics
Reviewed by Charles PottersReviewed by Charles Potters
Moderna Inc. is a biotechnology company that develops medicines based on messenger ribonucleic acid (mRNA), a single-stranded molecule that transfers genetic information to the cellular machinery responsible for making proteins that help to sustain life. These proteins can also have a therapeutic or disease-prevention benefit.
The company is developing therapeutics and vaccines for infectious diseases, immuno-oncology, rare diseases, and autoimmune diseases, on its own and by collaborating with strategic partners.
The vast amount of its revenue comes from the sale of its products, such as vaccines and therapeutics.
Moderna’s product sales exploded after it developed and won government approval for an mRNA vaccine to protect against COVID-19, called Spikevax®. In fact, this vaccine was its first product.
Key Takeaways
- Moderna is a biotechnology company that develops mRNA-based medicines.
- Its COVID-19 vaccine sent sales soaring during and after the pandemic. and now comprises the vast majority of total revenue.
- Sales in 2023 plummeted compared to 2022.
- The company had a net loss of $4.71 billion in 2023.
- Moderna expects sales to climb in 2024 and 2025.
Moderna’s Industry
Moderna (MRNA) operates in the Biotechnology industry within the Healthcare sector. It is also considered to be part of the pharmaceutical industry.
The company is working to develop 42 different medicines through 45 development programs. Of these, 40 were in clinical studies as of 2023.
Due to the nature of its business, Moderna tends to have net losses in most years (the exceptions being 2021 and 2022). Successful sales and profitability depend on its ability to develop products and obtain regulatory approval so that they can be sold to the public.
As a result, its operating results fluctuate and may not meet the financial expectations held by investors and analysts.
Competition
The biotechnology and pharmaceutical industries utilize rapidly advancing technologies and are characterized by intense competition. There is also a strong emphasis on defense of intellectual property and proprietary products.
Moderna’s major rivals include:
- Pfizer Inc. (PFE)
- BioNTech SE (BNTX)
- Johnson & Johnson (JNJ)
- AstraZeneca PLC (AZN)
- GlaxoSmithKline PCL (GSK)
- CureVac (CVAC),
- eTheRNA Immunotherapies NV
Note
Moderna is the 21st largest biotechnology company in the world as measured by market cap.
Moderna’s Financials
As of June 2024, Moderna’s market capitalization was $55.88 billion.
Moderna’s 2023 annual report reported the company’s financial results for the 2023 fiscal year (FY) ended Dec. 31, 2023. Additionally, on May 2, 2024, the company announced financial results for the quarter ended March 31, 2024.
Moderna operates as a single business segment focused on the discovery, development, and commercialization of mRNA medicines. The company breaks down the revenue of this single segment into three categories: net product sales, grant revenue, and collaboration revenue. It also provides overall operating income or loss, and net income or loss.
Grant revenue relates to contracts with government and private organizations that pay for costs related to research and development. These costs can include overhead and general and administrative costs.
Collaboration revenue relates to fee payments and funding for arrangements with companies for research and other licenses, as well as the development and commercialization of products. Revenue also includes commercial milestone payments, licensing fees, option exercise fees, and royalty and earnout payments on product sales.
Revenue
For FY 2023, total revenue was $6.84 billion, a decrease of 64% from the previous year’s $19.26 billion. For the first quarter of FY 2024, total revenue was $167 million, a decrease from $1.9 billion for the previous year’s first quarter.
Net product sales
For FY 2023, net product sales were $6.67 billion. For the first quarter of FY 2024, they were $167 million, which amounted to the total revenue for the quarter.
Grant revenue
For FY 2023, grant revenue was $94 million. Grant revenue was immaterial for the first quarter of FY 2024.
Collaboration revenue
For FY 2023, collaboration revenue was $83 million. Collaboration revenue was immaterial for the first quarter of FY 2024.
Operating Income
For FY 2023, the operating loss was $4.24 billion, a decrease of 145% from the previous year’s income of $9.42 billion. For the first quarter of FY 2024, the operating loss was $1.26 billion, a larger loss than the operating loss of $366 million in the previous year’s first quarter.
Net Income
For FY 2023, the net loss was $4.71 billion, a decrease of 156% from the previous year’s net income of $8.36 billion. For the first quarter of FY 2024, the net loss was $1.17 billion, a decrease from the net income of $79 million in the previous year’s first quarter.
History and Leadership
Moderna was established in 2010 and is headquartered in Cambridge, Mass. Its name is a combination of the terms “modified” and “RNA.”
The company started working on its first human vaccine for influenza in 2015. In 2017, it started work on its first combination vaccine, one that would protect against the human metapneumovirus (hMPV virus) and parainfluenza virus.
In 2022, the Food and Drug Administration approved Moderna’s application for Spikevax, its vaccine to prevent COVID-19 in people age 18 years and older. The CDC had recommended the company’s COVID-19 vaccine in 2020.
Stéphane Bancel was the founding CEO and still holds that position. He also serves on the board of directors. Stephen Hoge, M.D. is the company’s president.
Recent Developments
• In May 2024, Moderna announced that the U.S. Food and Drug Administration (FDA) had approved its mRNA respiratory syncytial virus (RSV) vaccine called mRESVIA (mRNA-1345). The vaccine is designed to protect adults aged 60 years and older from a lower respiratory tract disease caused by the highly contagious RSV virus. This is the second approved mRNA product from Moderna.
• In September 2023, Moderna established a R&D relationship with Immatics, a biopharmaceutical company. The goal of their collaboration is to combine Moderna’s mRNA technology with Immatics’ T-cell receptor platform to develop successful cancer therapies.
What’s the Value of a Share of Moderna?
On June 12, 2024, a share of Moderna was trading at $147.56.
Is Moderna Profitable?
Due to its focus, Moderna has enormous product R&D and other costs that can overwhelm sales and lead to net losses. However, for 2024, its CEO Stéphane Bancel predicts solid progress for its vaccines and therapeutics portfolio, and as a result, greater sales and profit potential.
Is Moderna Stock a Good Buy?
That depends on your investment and financial goals overall, where the company stands financially today, and your expectations for its progress. It’s important to review any company’s financial statements and fundamentals so that you can draw conclusions about performance. Keep an eye on Moderna’s performance results and leadership statements to determine the potential it has to generate greater sales, curb expenses, and post profits rather than losses.
The Bottom Line
Moderna is a biotech company that has led the way in the creation of messenger RNA medicines. It operates in the biotech and pharmaceutical industries. It developed and sold a COVID-19 vaccine that people around the world received.
The majority of its revenue is generated from product sales. Other revenue comes from grants and payments derived from its collaboration with other companies.
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