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Moderna (MRNA): COVID-19 vaccine helps company deliver first ever profitable quarter

Moderna expects to deliver 200-250 million doses in the second quarter of 2021

Shares of Moderna Inc. (NASDAQ: MRNA) were down 3% in morning hours on Thursday despite the company reporting the first profitable quarter in its history. Moderna delivered an earnings surprise for the first quarter of 2021 that smashed analysts’ projections of a loss. However, despite seeing a sharp rise year-over-year, revenues fell short of expectations. The top line miss combined with fears over easing of patent protections on coronavirus vaccines took a toll on the stock.

Strong Q1

Total revenue jumped to $1.9 billion in Q1 from $8 million in the same period last year, driven by sales of the COVID-19 vaccine. Product sales amounted to $1.7 billion from sales of the vaccine. The company reported net income of $1.2 billion, or $2.84 per share, in the quarter compared to a loss of $124 million, or $0.35 per share, in the same period last year.

COVID-19 vaccine

Moderna announced data that shows that a booster dose of its vaccine is effective against both the coronavirus as well as two of its variants. The company also announced positive data from its trial on teenagers that indicated a 96% efficacy rate in those aged between 12-17 years.

Moderna now expects to supply 800 million to 1 billion doses of its COVID-19 vaccine in 2021 and it is making additional investments to increase its global supply to up to 3 billion doses in 2022. The company has signed Advance Purchase Agreements (APAs) for the delivery of its vaccine in 2021, which is anticipated to rake in $19.2 billion in product sales, including sales recorded in Q1. Moderna expects to deliver 200-250 million doses in the second quarter of 2021.

Moderna has signed APAs with Israel and Switzerland for 2022, with Switzerland having options for further deliveries in 2023. Through its recent agreement, the company has committed up to 466 million doses to COVAX for 2022.

The company is discussing the extension of its APAs to 2022 for all the countries with existing APAs for this year as well as the option to supply new geographies in Asia, Latin America and Africa in 2022 where it was unable to do so this year due to manufacturing supply constraints.

Stock

The stock has gained 198% in the past 12 months and 52% since the beginning of this year. Pharma stocks fell on news of the US government’s agreement to waiver patent protection rules on COVID-19 vaccines in order to allow easier production and supply around the world. This has raised concerns over the impact of this move on the revenue and profits of pharma companies.

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