The images of eerie empty streets, along with the sight of masked civilians roaming around, all add to the sense that we are currently on the set of a dystopian sci-fi movie. Add into the mix the race among pharmaceutical companies to develop a COVID-19 vaccine or treatment, and the drama is further enhanced. But as we all know, this is no screenplay, but current daily life around the globe. Vying for a starring role in this real-life drama is biotech Moderna (MRNA).
The messenger RNA specialist is developing mRNA-1273, a vaccine against COVID-19 currently in Phase 1 testing, and has said there could be immunogenicity data available in June or July. The company is also manufacturing supply and expanding production capacity at its Norwood facility for a Phase 2 trial involving elderly subjects.
Following a conversation with CEO Stéphane Bancel regarding the vaccine’s progress, Needham’s Alan Carr said, “Management is not offering guidance with respect to development timelines or regulatory requirements, but Moderna is preparing to build supply for limited distribution in late 2020 in the event the FDA concludes mRNA-1273 risk-benefit is favorable at that time. Our default assumption is that no COVID-19 vaccine will be available for use until at least 2021, consistent with Anthony Fauci’s estimates of a 12-18 month timeline.”
Carr reiterated a Buy rating on Moderna along with a $35 price target. The upside potential from current levels comes in at 17%. (To watch Carr’s track record, click here)
Despite Carr’s belief that a vaccine won’t be ready until next year, Moderna has been in regular contact with the FDA concerning a EUA (emergency use authorization) for its candidate. These are granted in emergency situations when public health is in danger, for what would normally be considered unapproved medical products. That’s not to say the authorization is easy to earn, but rather the FDA reviews the data available with a lower ‘may be effective’ standard, depending on the gravity of the situation.
“We believe it is possible that a COVID-19 vaccine may be made available under an EUA if immunogenicity data are collected from a meaningful number of relevant subjects and strong animal model data are available,” Carr added.
What is the rest of the Street’s view? Looking at the consensus breakdown, Moderna’s Strong Buy consensus rating is based on 7 Buys and 1 Hold. At $32.86, the average price target could provide investors with returns in the shape of 11%. (See Moderna stock analysis on TipRanks)