Biontech and Moderna in the expansion race

Frankfurt Your sales in the Covid business will fall significantly in the current year. In research, however, Moderna and Biontech are continuing to expand at high speed.

This was made clear by the presentations by the two Covid vaccine pioneers and mRNA specialists at the healthcare conference of the US bank JP Morgan over the past two days. Both companies want to further significantly expand their clinical development programs in 2023, start a series of new studies and further develop and obtain approval for a broad product range beyond Covid.

Financially, the conditions for both companies continue to be excellent, despite the meanwhile declining sales. Because the Covid business of the past two years has ensured large cash inflows. According to Moderna, it started the new year with $18 billion in cash reserves, and Biontech with reserves equivalent to about $22 billion if outstanding customer receivables of a good $4 billion are included. Measured by their net cash positions, the two biotechnology climbers are currently the most heavily financed companies in the pharmaceutical industry.

The business with Covid vaccines promises declining, but still good income for the financing of clinical research projects in 2023 and in the following years. Moderna boss Stéphane Bancel referred to five billion dollars in firm Covid vaccine orders for 2023 and the prospect of possible further supply contracts.

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Biontech has not yet given an outlook on business in the current year. At the JPM conference, company boss Ugur Sahin confirmed the assessment that the corona virus would continue to mutate and that there would therefore continue to be a need for improved vaccines in particular. Biontech strategy chief Ryan Richardson even expects the Covid vaccine market to remain in the tens of billions in the long term. Analysts recently assumed on average that the sales of Biontech and Moderna will each halve to around eight to nine billion euros in 2023.

Moderna is rapidly increasing research spending

Both biotech companies are expanding their research activities at an unusually fast pace in the industry. Moderna tends to act a little more aggressively than its competitor from Mainz and continues to rely exclusively on mRNA.

In the past two years, the US company has roughly doubled the number of its clinical projects and increased its research spending from $1.4 billion to $3.5 billion. For the current year, Moderna plans with a budget of 4.5 billion dollars.

In the vaccine area, Moderna is now also testing mRNA vaccines against the cytomegalovirus (CMV), the respiratory syncytial virus (RSV) and influenza in phase 3 studies in addition to its Covid vaccines.

For a cancer vaccine based on mRNA, Moderna, together with its cooperation partner Merck & Co., also wants to start a larger phase 3 study this year, which if successful could form the basis for approval. The US company was recently able to present positive data from a phase 2 study for this product. The vaccine then reduced the risk of recurrence after surgery in skin cancer patients by 44 percent. In addition, Moderna is testing more than two dozen other vaccine and drug candidates in various therapeutic areas.

Biontech relies on multiplatform strategy

Biontech has also more than doubled its research spending since 2020, to around 1.5 billion euros last year. They are likely to increase further in 2023. Just like its US competitor, Biontech also wants to start potentially approval-relevant studies with one or more cancer vaccines in the current year. In the field of infectious diseases, the company is planning clinical studies with vaccine candidates against shingles and tuberculosis in addition to ongoing studies in the areas of Covid, flu, herpes simplex and malaria.

Biontech employee

The Mainz-based biotech company wants to use AI in therapy development after the takeover of Instadeep.

(Photo: dpa)

Compared to Moderna, Biontech pursues a broader technological concept. “We are extremely strong in mRNA, but that’s not the only thing we do,” emphasized Biontech boss Ugur Sahin. Rather, he sees Biontech as a multi-platform company that is open to all technologies. In the field of cancer, for example, Biontech is now also intensively researching cell therapies. In addition, the focus is increasingly on interfaces between the technologies, says Sahin.

Differences in focus are also reflected in the most recent acquisitions: At the beginning of the year, Moderna strengthened itself with the acquisition of the Japanese start-up Oriciro, which is working on technologies for the faster production of mRNA. Biontech, on the other hand, wants to expand its capabilities in the field of artificial intelligence with the purchase of the British company Instadeep in order to use AI technologies for the development of new therapies. A step towards technology companies.

Investors favor Moderna

So far, investors have rated Moderna’s strategy and prospects significantly more positively than those of Biontech. At least that is what the still relatively large difference in market capitalization signals. Subtracting cash positions from current market value values ​​Moderna’s R&D pipeline and Covid business at around $54 billion. For Biontech, on the other hand, this value is only around 15 billion dollars.

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