Moderna said deposits were recorded as ‘deferred revenue’ that would be booked when it delivers an approved vaccine
Moderna said deposits from governments were recorded as ‘deferred revenue’ that would be booked when it delivered an approved vaccine © Henry Ford Health System/AFP via Getty

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Moderna has received more than $1bn in deposits from governments for its potential Covid-19 vaccine, highlighting how the pandemic has transformed the fortunes of the lossmaking US biotech.

Contracts from countries for its vaccine candidate helped Moderna to turn cash flow positive in the third quarter for the first time in its 10-year history. The Boston-based company now expects net cash of between $100m and $300m in the fourth quarter. 

Stéphane Bancel, Moderna’s chief executive, said 2021 would be the “most important inflection year” in the company’s history, proving that its platform technology could deliver other vaccines and treatments.

“We always said from day one that it made no sense that this would be a one product company. It will be zero if we fail to make a safe and efficacious product. Or it will be a new class of medicine, changing medicine forever,” he said on Thursday. 

Moderna’s products are all based on a genetic sequence called messenger ribonucleic acid, which in the case of the Covid-19 vaccine is used to teach the body to recognise code from the Sars-Cov-2 virus and produce antibodies to attack it.

After choosing not to partner with a larger pharmaceuticals company, Moderna maintained its worldwide rights and would receive all the profits from a Covid-19 vaccine, Mr Bancel said. The vaccines manufactured before the company secures an emergency approval will not cost the company anything, because it has been funded by grants from the US government. 

He added that cash had always limited the company’s progress but that would change in a “very material way” next year and Moderna intended to reinvest this money into its product pipeline. 

Shares in Moderna — which have jumped more than 250 per cent this year — rose 10.5 per cent to $72.62 in afternoon trading in New York. The biotech expects interim data on whether its vaccine works in phase 3 trials in November, and to hit the regulatory requirements for data collection on safety in late November. 

Moderna said customer deposits — after it signed deals with the US, Canada, and Japan, among others — were recorded as “deferred revenue” that would be booked when the company delivered an approved vaccine. The company, which is in advanced talks with the European Commission, may also see more advanced orders ahead of a vaccine approval. 

In the third quarter it reported revenue from grants and collaborations of $158m, higher than the consensus forecast, and made a net loss of $234m, widening from a loss of $123m in the same period last year. 

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Moderna’s vaccine is priced at about $25 a dose in its US government contract for 100m doses, but the company has said it could be $32 to $37 a dose when sold at smaller volumes. The vaccination requires two doses.

A successful Covid-19 vaccine could revolutionise Moderna’s prospects, unlike many of its rivals which are major pharma companies that already have a bank of blockbuster drugs or vaccines. 

Stephen Hoge, Moderna’s president, told the Financial Times that Pfizer, Johnson & Johnson or AstraZeneca are not in the same position, because vaccines are only a small portion of what they do, and they do not have a similar platform technology to prove.

Dr Hoge said he hoped the vaccine would be a “transformational moment” for Moderna and the world.

“It will be the first demonstration unequivocally of our platform technology, that has been a decade building,” he said.


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