Moderna Inc. (MRNA) revealed its plan of investments to accelerate the supply of its COVID-19 vaccine at its owned and partnered manufacturing facilities. The company anticipates global capacity of its vaccine to reach 3 billion by 2022.
Notably, this target will depend on the mix between the already authorized Moderna COVID-19 Vaccine, lower doses of variant booster candidates, together with pediatric vaccines once they are approved.
Moderna’s planned investments, which are likely to be funded from its existing cash balances will double the drug substance manufacturing at Lonza’s (LONN) Switzerland-based unit. Additionally, formulation, fill and finish, and drug substance manufacturing will more than double at Rovi’s (ROVI) Spain-based facility along with a 50% rise of drug substance at Moderna’s facilities in the US.
Furthermore, upon completion of the target, the safety stock of raw materials and finished products, which are used to deliver committed volumes, will be enhanced through these investments.
Moderna plans to initiate investing at its owned and partnered manufacturing facilities in 2021, with the expectation of increased production to ramp up in late 2021 and early 2022. For 2021, the company’s manufacturing supply forecast has been increased to between 800 million and 1 billion doses.
Notably, the expected rise in doses is in addition to the recently announced increases in formulation, fill and finish in the US with Catalent and Sanofi. Moreover, other agreements are likely to be in pipeline and are undergoing advanced negotiations.
Moderna CEO Stephane Bancel said, “As we follow the rapid spread of SARS-CoV-2 variants of concern, we believe that there will continue to be significant need for our mRNA COVID-19 vaccine and our variant booster candidates into 2022 and 2023. We are hearing from governments that there is no technology that provides the high efficacy of mRNA vaccines and the speed necessary to adapt to variants, while allowing reliable scalability of manufacturing…We thank our manufacturing partners for their work and their commitment. Together with our partners, Moderna is committed to continuously developing best-in-class variant boosters so we can end this pandemic as fast as possible.” (See Moderna stock analysis on TipRanks)
On April 15, Chardan Capital analyst Geulah Livshits reiterated a Buy rating and a price target of $182 (3.3% upside potential) on the stock.
Livshits said, “Last year’s Vaccine Day featured discussion of clinical plans for the Covid-19 vaccine program, manufacturing sale-up logistics, and the many unknowns regarding Covid-19 immunity. A year later, Moderna has demonstrated the ability to develop and manufacture highly effective mRNA vaccines at the commercial scale; the company has experienced a corresponding inflection in valuation and cash.”
“In 2021, Moderna’s newfound status as a major vaccine player and household name positions the company to expand commercial relationships and build awareness in new markets (e.g. CMV),” the analyst added.
The rest of the Street is cautiously optimistic about the stock with a Moderate Buy consensus rating. That’s based on 5 Buys, 5 Holds, and 2 Sells. The average analyst price target of $174.20 implies that MRNA is fairly priced at current levels. Shares have increased almost 60% so far this year.
TipRanks data shows that financial blogger opinions are 83% Bullish on MRNA, compared to a sector average of 69%.
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