modern (Nasdaq stock code: MRNA) with Pfizer (New York Stock Exchange: PFE) They made history by bringing the coronavirus vaccine from development to market in less than a year. However, so far, Moderna is still the only company that has benefited from a stock price perspective. The company’s stock price has soared by more than 600% this year. Pfizer’s stock has hardly changed.
Why is there such a difference? Investors know that the final vaccine will be Moderna’s first listed product, and therefore it is also the source of its product revenue. On the contrary, Pfizer̵
Now we have entered a new phase. Under emergency authorization, Moderna and Pfizer launched the vaccine this month. Let’s see which company may win in terms of revenue and share of performance.
Authorization in the UK, US and Europe
Pfizer and partners Biological Technology In the United Kingdom, then in the United States, and recently authorized in the European Union. The pharmaceutical company has ordered at least 550 million doses from many countries and regions including the United States, the European Union, and the United Kingdom. This figure does not include Canada, which ordered a dose but did not announce a dose.
Pfizer has not yet issued a fee schedule, but we can use the price paid in the United States as a guide. One hundred million doses is equivalent to US$1.95 billion, or US$19.50 per dose. For the doses ordered so far, it equals more than 10 billion US dollars. Pfizer must also share some benefits with BioNTech.
Let’s take a look at Moderna. Last week, the U.S. Food and Drug Administration (FDA) granted emergency use authorization for the Moderna vaccine. The biotech company has received orders for more than 470 million doses from the United States, the European Union, Canada, Switzerland and other countries. Like my Pfizer count, this does not include countries that have not announced the order quantity. In this case, it means Singapore and Qatar.
We will use the price paid by the United States again to estimate our revenue, which is equivalent to US$1.5 billion (100 million doses) or US$15. This means that revenues from drugs ordered so far exceed $7 billion. One thing to keep in mind is that Moderna’s unit price for small doses is US$32 to US$37, so it may bring higher revenue.
There are other points to consider. First, it is clear that these companies will not generate such a level of revenue overnight. Moderna’s goal is to provide up to 125 million doses in the first quarter. Therefore, in the short term, revenue may be less than $2 billion.
Pfizer said it can provide as many as 50 million doses this year and 1.3 billion doses by the end of next year. Therefore, by the end of this year, it may generate approximately $975 million in revenue.
Nevertheless, Moderna and Pfizer are both expected to quickly reach a blockbuster sales level of US$1 billion through their coronavirus vaccines. This is very important.
From a revenue perspective, regardless of other factors, the performance of the two companies may be comparable. However, logistics factors are also part of it. I mean transportation and storage. In this area, Moderna scores higher.
Moderna’s vaccine can be transported and stored at standard refrigerator temperatures. It can even be left at room temperature for 12 hours. Pfizer needs extremely low temperatures, so countries and medical systems that want to provide Pfizer vaccines must invest in special freezers.
The cost of the freezer ranges from US$5,000 to US$15,000. This greatly increases the overall budget for vaccination. Stat News reported that Pfizer’s minimum order quantity is higher than Moderna’s minimum order quantity of -975 doses to 100 doses. Factors of temperature and minimum order quantities may make it difficult or impossible for many small medical institutions to consider Pfizer vaccines.
What does this mean for the company and its investors?
In the first few weeks of the vaccine’s launch, the world needed all the vaccines it could get. As can be seen from the above figures, neither company has the production capacity to complete all orders immediately. Even if Pfizer’s vaccine represents a logistical challenge, the state and medical institutions will try their best to adjust.
However, once the initial order is completed and both companies have reached full capacity, Moderna is likely to become the leader. Transportation and storage requirements mean that Pfizer’s vaccines will cost countries more than just the price of the dose. The government will take this into consideration when deciding on the next order.
In terms of stock price, Moderna also gained the most profit. Investors will pay close attention to the revenue of this first and only product in the coming quarters. If it meets or exceeds expectations, the biotech company’s stock may be heading for another winning year.