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Shares in prescription drugmaker Moderna have tumbled 37% this year, with declining COVID vaccine revenue and the appointment of vaccine skeptic Robert F. Kennedy Jr. to lead the US Department of Health and Human Services serving as more kick in the teeth than shot in the arm.
Last week, however, brought a sigh of relief for executives: US Food and Drug Administration officials laid out a new regulatory framework for COVID-19 vaccines, and analysts deemed the impact essentially “meh.”
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Framework Fears
FDA Center for Biologics Evaluation and Research Director Dr. Vinay Prasad and FDA Commissioner Dr. Marty Makary explained the new regulatory framework for COVID jabs in the New England Journal of Medicine. In short, they said the FDA will continue to approve updated shots for seniors and high-risk adults but will require randomized and controlled trials before approving new shots for young people and all other adults.
While the new framework marks a shift from previous universal booster recommendations, it is “less restrictive than feared,” William Blair analyst Myles Minter wrote. In fact, Centers for Disease Control and Prevention data cited by Prasad and Makary shows that just under a quarter of the US population has been boosted each year. Their Journal of Medicine piece noted that 100 million to 200 million Americans will still be eligible for annual shots under the new framework, implying little to no change in the number of annual boosts. From a fiscal perspective, analysts viewed that as a mostly good sign for vaccine manufacturers:
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Commenting on Moderna’s much-larger and more diversified rival Pfizer, which has nevertheless fallen 12.1% this year, Guggenheim analysts wrote that the new framework basically affirms market trends, and that most people currently receiving COVID booster shots will remain eligible.
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There are still broader concerns: Moderna is counting on revenue from newer mRNA vaccines, including a next-generation COVID shot, to make up for falling sales, which were just $3.24 billion last year compared with a record $19.2 billion in 2022. Since his appointment, Kennedy has moved to heighten scrutiny of vaccines, something the HHS Secretary reiterated in a report last week, which could slow down approvals.
Already in Practice: Companies and regulators have, in some ways, already adjusted their practices based on the new administration’s policies. Last week, Moderna withdrew an application for approval of a combination COVID and flu vaccine to wait for data from a late-stage flu vaccine trial and said it doesn’t expect approval until 2026. The move was expected and considered a sign of heightened regulatory scrutiny. When the FDA approved a COVID-19 vaccine from Moderna and Pfizer competitor Novavax last week, following a month-long delay, it limited the decision to seniors and people with underlying health conditions, essentially mirroring the new framework announced by Prasad and Makary.
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