"Moderna is more than just the COVID vaccine"

As sales decline for its messenger RNA Covid vaccine, US biotech Moderna is ramping up its non-COVID work. For CEO Stéphane Bancel, mRNA technology has a compelling future well beyond the pandemic.

By Bertrand Beauté

Moderna is a perfect case study of a small company becoming a giant almost overnight. Virtually unknown before the pandemic, the American biotech’s revenue stood at just $60.2 million in 2019, but this figure then skyrocketed to $18.7 billion in 2021. Its success was down to four letters: mRNA. The pandemic served as proof for the first time that messenger RNA (mRNA) technology could be both effective and deployed on a large scale. This generated a fortune for Pfizer-BioNTech and Moderna, the first two companies to make their mRNA vaccines available.

So where does Moderna stand now? Using its new war chest, Moderna has begun a whole host of both scientific and industrial projects. The pharmaceutical lab plans to apply mRNA technology to treatments for other diseases. It has around 50 mRNA compounds in the development pipeline for the treatment of viruses (flu, RSV, HIV, Zika) as well as non-infectious illnesses such as certain cancers and rare diseases. At the same time, Moderna (which currently has only a single facility in Norwood, US) is also planning to expand to new locations. In early March 2022, the company announced a memorandum of understanding to build an mRNA vaccine manufacturing facility in Kenya. That same month, it also began a partnership with the Australian government to build an mRNA vaccine complex in Melbourne. In April, the construction of a new facility in Quebec was announced, and an agreement in principle was signed with the UK government on 22 June. Similar projects are in the works for France and South Korea. Speaking with Swissquote Magazine, Stéphane Bancel, CEO of Moderna, explains why these investments are so important as sales from COVID vaccines decline.

Canada, the United Kingdom, Australia, Kenya... Why is Moderna looking to build factories all over the world?

What we truly lacked during the pandemic was a regional production strategy. While Switzerland – as an export site – was a perfect location, with other countries, we had significant difficulties exporting, which we were shocked by. For example, in the first few months of 2021, the United States banned us from exporting our vaccines, including to Canada. So we want to have a production facility on each continent, including Africa, so that these export issues, which cost a lot of people their lives, do not happen again in the next pandemic. And yes, I’m convinced there will be other pandemics.

There are also rumours about a facility in France. If this materialises, could it risk your partnership with Swiss company Lonza, which manufactures your vaccines?

Yes, we are in discussions with the French government. But as I’m sure you know, I can’t say any more on the topic. Discussions between a government and a private company are confidential. As for Lonza, building a facility in the United Kingdom and potentially France would not risk our partnership.


"We currently have 48 programmes in development across 45 development candidates, of which 35 are currently in active clinical trials"


Currently, Moderna only markets COVID vaccines, and sales are declining. Is it premature to launch all of these new projects while your other treatments are still in development?

No. We built Moderna to be a technological platform, not a COVID-based company. In the traditional pharmaceutical industry, 90% of new molecules fail during clinical trials because of their toxicity. Why is that? Because each drug that is in development is a new compound. So you need to conduct long and costly clinical trials in order to evaluate the efficacy of each compound but also to understand the chemical and toxic properties of each molecule. Pharma companies start from scratch for each new drug and must re-learn all of that information every time.

At Moderna, our approach is completely different: the chemistry of our cancer vaccine is 100% the same as our Spikevax COVID vaccine. That is where our platform is truly ground-breaking. The only thing that regulators need to confirm is that we’re still manufacturing the same product with no impurities, and of course that the treatment is effective against the targeted disease. But toxicity is no longer an issue because the molecules are always the same, which means that many more of our drugs should succeed in clinical trials compared to companies in the traditional pharmaceutical industry. Furthermore, since the chemistry of our compounds remains the same, our treatments can be produced in any of our factories around the world with no difference between them. We currently have 48 programmes in development across 45 development candidates, of which 35 are currently in active clinical trials.

What are your most advanced vaccine candidates and what will be your first non-COVID product on the market?

We currently have two products in phase III clinical trials (ed. note: the last step before being made commercially available): a flu vaccine and a vaccine for respiratory syncytial virus (RSV). The final approval phase for these two vaccines will take place in Q1 2023. I can’t tell you which will be on the market first. There are lots of RSV cases around the world right now, and since the speed of studies depends on the number of people enrolled, it’s possible that we could get definitive data on the RSV vaccine before data on the flu vaccine. After that, it depends on the approval authorities in each country. Since there isn’t yet an RSV vaccine on the market, health officials may be tempted to speed up approval. It could be ready as early as autumn 2023. But if Swissmedic, for example, does not fast-track the study, we may have to wait until autumn 2024, as both illnesses are seasonal.

We already have flu vaccines. What benefit is there in putting another one on the market?

The seasonal flu vaccines that are currently available are about 50% to 60% effective in a good year and 20% to 30% effective in a bad year. The worst-case scenario is when the flu virus mutates during the period between when the WHO chooses the target strain in February and when the virus actually circulates in autumn. With our vaccine, we can avoid that problem because we will be able to manufacture the vaccines much later in the year. As a result, we can significantly increase efficacy. I think that an efficacy of 90% to 95% is possible in the long term. Right now, we are able to create, produce and market a vaccine in 60 days, compared to several months for traditional vaccines. During the COVID pandemic, for example, the FDA asked us to create an Omicron vaccine on 28 June. On 2 September, it was available in pharmacies in the United States. Simply put, we are able to determine which strain to target much later in the process, and even if the virus mutates in autumn, we can update our vaccine for winter. For high-risk individuals, this could have an enormous impact on the probability of hospitalisation. These people could receive a second injection with an updated vaccine in December when flu season is still ongoing.

Your next project is to combine the flu, COVID and RSV vaccines into one injection. What are the advantages of a combined injection?

There are 10 respiratory viruses that cause flu-like symptoms, including COVID, RSV and the flu itself. People often think they have the flu, but in fact they have a different virus. According to figures from the WHO, infectious respiratory illnesses were the fourth leading cause of death worldwide in 2019 (ed. note: after cardiac disease, COPD and cancers). So it’s a major public health concern. But having 10 different injections each autumn is a lot to ask. Getting just one would be more acceptable to people.

Today, with mRNA technology, there’s no scientific reason why we can’t use one single vaccine to protect against those 10 viruses in one dose. By developing such a product, Moderna can have an incredible impact on public health, on quality of life for the general public and on the economy as a whole, because everyone ends up paying the price for hospitalisations and lost productivity – even though the financial aspect is just an added bonus. Health authorities are very interested in a single solution that can protect against all of the respiratory viruses.


"The companies that are entering this market now have 10 years of catching up to do"


What is the commercial potential of a combined vaccine for RSV, COVID and the flu?

There are currently 1.5 billion people around the world who are either over 50 or who are high-risk due to a co-morbidity. If you multiply this figure, the number of high-risk people, by the price of a flu or COVID vaccine, you can see that it’s a significant market. Especially so, given that this type of product can only be made with mRNA technology – it cannot be made with traditional recombinant vaccine technology – and there are only a few companies that have truly mastered mRNA and have the patents to use it.

Moderna and Pfizer-BioNTech are currently the only two companies to have mastered mRNA vaccines. But traditional vaccine giants such as Sanofi have announce major investments in this technology. Are you afraid of the competition?

The companies that are entering this market now have 10 years of catching up to do and don’t have the focus that we have. I think about messenger RNA all day: in the morning, in the afternoon, and at night before I go to sleep. How long do the CEOs of these big pharma groups spend thinking about mRNA each week? A few hours at the very most. The intensity and focus of a small company such as ours, which concentrates on one single technology, simply cannot be compared to what’s possible for a large company that is developing several different technologies at the same time. I often see in the news that such-and-such a company has announced plans to invest $1 billion in mRNA over 10 years. And that makes me laugh because we’re investing $4 billion next year. It’s going to be hard to catch up with us.

Why has the mRNA revolution come from two small companies rather than pharma giants?

I don’t know of a single industry in which a disruptive technology has come from a large company. The reason is simple: it is very difficult for large companies to lose money for years at a time while investing in a disruptive technology. But it’s impossible to conduct disruptive science without a lot of money, because no one has ever done what you’re trying to do, so there are a lot of problems to overcome. We’ve been overcoming problems here at Moderna for the past 10 years. We tried things and sometimes they worked, sometimes they didn’t. Why did a certain trial fail? No one knows, because no one had conducted that specific trial before. You can’t call up an EPFL professor and ask for help, because they don’t know the answer. In health science, you need 10 to 20 years of research, which means 10 to 20 years of investments, knowing that if you don’t succeed, all of that money was wasted. This risk is why large companies hate disruptive investments. They are not set up for these types of investments and they don’t have the culture for them. On the other hand, what they are able to do very well are clinical trials, industrialisation and commercialisation. Most of the drugs that big pharma groups sell were developed by small companies that they then acquired. Big pharma is no longer capable of innovating the way that it did 20 years ago.

You’re also developing an AIDS vaccine, a disease that all clinical trials have failed to treat over the past 40 years... What advantage will mRNA technology bring to the fight against AIDS?

The problem with HIV is that it is a very difficult disease to model, even with monkeys, and that the virus mutates very quickly. Thanks to the speed with which we’re able to make vaccines, we’ll be able to test several formulas to see what works. I think that our v1.0 vaccines for flu and RSV will be effective, because the biology of these viruses is very well understood at this point. But for our v1.0 AIDS vaccine, I have no idea, because the biology is not as well understood. But since we can multiply the iterations, I think we will succeed in progressively optimising our vaccine formula so that the X.0 version will be effective.


"Large companies hate disruptive investments. They are not set up for these types of investments and they don’t have the culture for them"


Shares in Moderna were worth just a few dollars before the pandemic, but jumped to more than $400 in 2021. The price is now back below $200. What are shares in the company really worth?

Our problem is that we’re a new company, so we are subject to a wide variety of opinions on our future. If you look at the analyst reports for next year, Moderna’s revenue outlooks go from $3 billion to $20 billion – in short, analysts don’t all agree what Moderna will become in the next year. And they’re even less sure about what will happen in five or 10 years. Why is that? We’re a disruptive company, and like all disruptors, it takes time for people to understand our model. There are some who think that our company is focused solely on COVID, whereas I believe we are a platform company that will produce vaccines and treatments for many diseases. Some investors understand that and others don’t. So I think that over the next five years, we’ll see volatility in our share price. And then, once everyone understands that Moderna is a platform, volatility will decrease as investors agree on our true value.


Moderna’s Q3 results were published in early November and analysts were disappointed. The pharmaceutical company, which generated $3.1 billion in revenue compared to $4.8 billion over the same period a year earlier, now expects sales to reach $18 to $19 billion in 2022, versus earlier predictions of $21 billion. These results can be explained by the drop in sales of its COVID vaccine, which could decrease even further in 2023. The market is now waiting for Moderna to prove that it can diversify beyond COVID – and Moderna is hard at work to do just that. In the short term (2023 or 2024), the company plans to market its vaccines for the flu and respiratory syncytial virus (RSV). In the longer term, it seeks to apply mRNA technology to treat rare diseases, cancers and/or cystic fibrosis in particular. It remains to be seen whether Moderna’s formulas will be effective to treat the diseases they are targeting. If they are, Moderna could become a giant in the next few years. Most analysts are cautious and recommend holding shares.