In the early days of the COVID-19 pandemic, Moderna(NASDAQ: MRNA) was a top performer, from both a share-price and an earnings perspective. As one of the leading coronavirus vaccine companies, the biotech brought in billions of dollars in annual earnings and saw its stock price jump more than 2,300% from January 2020 through early August of 2021. But in recent years, its stock performance and earnings have disappointed investors.
With demand for COVID vaccination on the decline, Moderna hasn’t been able to count on its vaccine for growth. On top of that, the company’s second approved product — a respiratory syncytial virus (RSV) vaccine — brought in lower revenue than expected during its first quarters of commercialization.
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Still, Moderna has a solid pipeline with many late-stage candidates, and some could soon reach the finish line. Where will Moderna be in five years? Let’s find out.
Image source: Getty Images.
First, let’s summarize Moderna’s story so far. The biotech is a specialist in messenger RNA technology, using mRNA to teach the body to make certain proteins that fight or protect against disease. The company’s pipeline — spanning programs from respiratory viruses and latent viruses to cancer and rare diseases — revolves around this technology. Back in 2020, Moderna successfully brought its mRNA coronavirus vaccine from drawing board to market in less than a year.
Considering the enormous need for such a product during those days of the pandemic, revenue soared. And it reached a peak of more than $19 billion in 2022. But in later stages of the health crisis, demand slipped, and that resulted in significantly lower revenue for Moderna. Last year, for example, revenue totaled only $3.2 billion.
As a result, Moderna’s shares have suffered, falling more than 90% since their peak in 2021.
Now let’s consider where Moderna will be a few years from now. The company recently said it aims to bring as many as 10 products to market by 2027. So in five years, if all goes well in clinical trials and through regulatory review, Moderna could have many products on the market and in a variety of areas. Among these, we may find a cytomegalovirus (CMV) vaccine, a personalized cancer vaccine, and a norovirus vaccine. All of these programs are involved in phase 3 trials today.
The company also is studying a number of candidates in phase 2 — including one for the rare metabolic disease propionic acidemia, and vaccine candidates for Lyme disease and the Zika virus. These also could reach the market by 2030.
Of course, it’s possible Moderna will face some setbacks or even failures — something that’s part of the drug development process, and a challenge all biotech and pharma companies face. But it’s still very likely that the company will have several products on the market, and across multiple therapeutic areas, five years from now. There’s reason to be optimistic about its chances, as its success rate for clinical trials has been higher than the general industry average. For example, Moderna’s probability of success for phase 3 is 83%, compared to 69% for the “traditional biopharma” industry.
This means that by 2030, its revenue picture may look quite different from today’s. Products generally must be on the market for about a year before sales really start to climb. But today, considering potential product launches ahead, Moderna predicts compound growth of 25% per year — which would bring revenue to $6 billion in 2028.
The company is also adjusting its research and development (R&D) according to the profit opportunity. For example, Moderna said respiratory vaccine research made up half of investment from 2024 through 2025, but should make up about a third from 2026 through 2028. Also during this period, investment in oncology will be on the rise, and is set to make up a third of R&D investment over the coming three years.
By 2030, Moderna probably will have multiple products operating across multiple treatment areas — and revenue may be entering a new phase of growth. This biotech company hasn’t been a favorite of investors over the past few years, as it transitioned away from its reliance on the coronavirus vaccine. Such a transition, which involves shepherding new products to the finish line and growing revenue, takes time. But Moderna is on track to be successful over the long term, even as early as five years from now. That makes it a great buy for biotech investors today.
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