1. A 100 Billion Dollar Plus Blue Sky Market Valuation

In June of 2020, Moderna was valued at $25 billion despite having no federally approved drugs on the market. Fast forward to April of 2021 and you get an idea of just how much Moderna’s fortunes have changed. Still with no federal approval but now boasting a EUA for its mRNA vaccine, the future looks incredibly bright for this company. In February of 2021 Hartaj Singh, managing director and senior analyst of biotechnology at Oppenheimer said that similar companies’ sales trajectories showed what Moderna could experience in the future.

“What we do is point people to other companies in the biotech sector that have peaked or hit a valuation when they launched their first set of products. Companies as diverse as Alexion, Regeneron, and Vertex, currently, and they essentially peaked at about ten times future sales, future sales being three to five years out.”

“I think with Moderna’s coronavirus vaccine franchise, and they’re also starting to develop flu vaccines which should hit the market in the next couple of years … you know, we could see a $10 billion franchise five to seven years from now. If you put a ten times sales multiple on that then, you can do the math, then it’s a $100 billion-plus market cap company.

In December of 2020, Moderna was valued at $60 billion.

2. The NIH Jointly owns the Moderna mRNA Intelectual Property

NIH and Moderna have researched coronaviruses, like MERS, for several years, and signed a contract this past December that stated “mRNA coronavirus vaccine candidates [are] developed and jointly owned” by the two parties. The contract was not specific to the novel coronavirus, and it was signed before the new virus had been sequenced. Separately, four NIH scientists have filed for a provisional patent application entitled “2019-nCoV vaccine,” according to disclosures in a pending scientific paper. Moderna scientists co-authored that paper, but none are listed as vaccine co-inventors.

3. Modified and DNA combined

Originally known as ModeRNA Therapeutics, the companywas formed in 2010 to commercialize the research of stem cell biologist Derrick Rossi. Rossi had developed a method of modifying mRNA. He approached fellow Harvard University faculty member Tim Springer, who solicited co-investment from Kenneth R. Chien, Bob Langer, and venture capital firm Flagship Ventures. The group formed ModeRNA, the result of the combined terms “modified” and “DNA”.

4. A record-breaking IPO in 2018

In 2018, the company rebranded as “Moderna Inc.” with the ticker symbol MRNA. In December of the same year, Moderna became the largest biotech initial public offering (IPO) in history, raising $621 million (27 million shares at $23 per share) on NASDAQ, and implying an overall valuation of $7.5 billion for the entire company. Not too dusty, considering Moderna had not as yet brought a product to market in their 8-year lifespan.

5. Board Members and Star Trek

In March of 2020, the FDA approved clinical trials for the Moderna vaccine candidate, with Moderna later receiving an investment of $483 million from Operation Warp Speed. Moderna board member, Moncef Slaoui, a Moroccan-born Belgian-American researcher was appointed head scientist for the Operation Warp Speed project.

6. Dictatorships and domination

CEO Stéphane Bancel, a French businessman with a pharmaceutical sales and operations background has led Moderna since 2011. His leadership style has been described as egotistical, authoritarian and secretive, with a zero-tolerance policy for employees that do not fully embrace the company ethos. Interestingly Bancel is listed as a co-inventor on more than 100 of Moderna’s early patent applications, unusual considering Bancel is not a Ph.D. scientist. Bancel is the third-largest individual shareholder in the company after Noubar Afeyan (Flagship Ventures) and Robert Langer. His current net worth is $5.6 billion according to Forbes. Bancel, when questioned about his abrasive management style, had the following comment.

“You want to be the guy who’s going to fail [patients]? I don’t. So was it an intense place? It was. And do I feel sorry about it? No.”

STÉPHANE BANCEL, MODERNA CEO

7. Get your cancer cure here

Where other CEOs are cautious about raising unrealistic expectations of their companies and products, Bancel suffers from no such restraint, often touting the mRNA technology as a potential cure for cancer, right down to having it engineered for each patient. In 2018, in an article published in Wired, Moderna president Steven Hoge made the following statement;

“We’re going to be able to make medicines that address diseases in different people in very different ways as a result of mostly removing humans from the process, It’s not something that is like ‘oh, this is the right color for you,’ it’s actually, “no, we invented this color for you.’”

8. AstraZeneca bets big

In 2013 Moderna, who had up to that point been subsisting on the financial smell of an oil rag, signed a staggering $240 million partnership with UK pharmaceutical giant AstraZeneca. It was the most money pharma had ever spent on drugs that had not yet been tested in humans. The NYT article published in the wake of the deal sums it up aptly in its headline: “AstraZeneca Makes a Bet On an Untested Technique.”

9. Regenerating your heart

It’s not just vaccines and cancer that interest Moderna. An excellent example of the widespread applicability of mRNA to treat disease is their therapeutic, AZD8601, developed in conjunction with AstraZeneca, for restoring blood vessels and oxygenation to the heart muscle. Currently, in Phase 1 Clinical trials, the vice-president of AstraZeneca’s IMED Biotech Unit Dr. Regina Fritsche-Danielson made the following comment in a blog post.

“In preclinical studies [for AZD8601], we have seen new blood vessels appear at the borders of damaged heart muscle. This was in response to injections of VEGF-A mRNA, carefully targeted at areas where oxygen levels were low. More than that, we have also seen improved cardiac function in these preclinical models as a result of the improved blood and oxygen supply being delivered to the heart.”

10. 2021 Shkreli Award winners for blatant overpricing

Every year The Lown Institute issues its top ten list of the worst examples of profiteering and dysfunction in health care. This year they highlighted bad actors from the Covid-19 pandemic. In February, CEO of Brigham and Women’s Hospital Dr. Elizabeth Nabel wrote an op-ed defending high drug prices as a necessity for innovation. In the piece, she did not disclose her role as a member of the board of biotech Moderna, which was developing a Covid-19 vaccine at the time. As a Moderna board member, Nabel received $487,500 in stock options and other payments in 2019.

Nabel sold $8.5 million worth of Moderna stock in 2020, after the company’s stock nearly quadrupled this year on news of early success with its COVID-19 vaccine. In response to criticism, Nabel resigned from the Moderna board.

In August, biotech company Moderna set an estimated price for its Covid-19 vaccine at $32-$37 per dose for “some customers” (the vaccine requires 2 doses). This price is higher than any other Covid-19 vaccine so far, even though 100% of Moderna’s development costs were covered by US government funding. Since Moderna was nominated, their lower bound for vaccine price has declined, in part due to public scrutiny.

Moderna’s CEO clarified in November that they will charge governments $25 — $37 per dose, depending on the amount ordered. Although the US has placed an order for $1.5 billion in doses of the vaccine at a discounted $15 per dose, given the upfront investment by the US government, we are essentially paying for the vaccine twice.

An insane achievement

As a final thought, it may be worthwhile to mention that this company produced a working and administrable version of the vaccine within 25 days of receiving the DNA sequencing for the coronavirus. This is an unprecedented achievement in vaccine development. To place it onto context, it is akin to Edmund Hillary running up to Everest’s summit in a few hours, rather than his arduous trek over weeks.

On March 16, 2020, Jennifer Haller was the very first recipient of the Moderna vaccine for Covid to be administered in America and globally. This signaled the beginning of phase 1 trials in the US. The rest, as they say, is history. The article below describes in detail Bancel and Moderna’s journey through the development of the vaccine and makes for insightful reading. It’s from the Boston Magazine and we highly recommend it.

The potential of this method of delivering instructions to the body to produce its own chemicals and drugs is almost limitless. The technology is being explored as a treatment for almost every disease and condition we can think of including cancers, HIV, heart conditions, atrophied blood vessels, the list never ends and we’re as excited and hopeful as Bancel.

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