Shares of Moderna (NASDAQ:MRNA) are up 14% at 1:01 p.m. EST on Monday, having been up as much as 18.6% today, likely because COVID-19, the illness caused by the new coronavirus, continues to spread globally.
There have been over 89,000 confirmed cases of the disease according to data tracked by Johns Hopkins University's Center for Systems Science and Engineering. While most (over 80,000) have been in mainland China, the number of cases outside that country continues to climb. A second death in the U.S. from the disease was reported Sunday night.
Moderna has already created a vaccine, mRNA-1273, which the biotech has shipped to researchers at the National Institute of Allergy and Infectious Diseases. A clinical trial is scheduled to start this month, which will produce early initial results by August.
President Donald Trump was scheduled to meet with executives from drug companies today to discuss the situation. It isn't clear what Trump or Vice President Mike Pence, who is heading the U.S. government's response to COVID-19, can do to speed up the process. Drug development takes time.
While mRNA-1273 offers an opportunity for Moderna to generate revenue quicker than it likely will with its pipeline of drugs, biotech investors should be cautious about penciling in too much future revenue into their valuation models. Other companies are also working on vaccines for COVID-19, and if multiple vaccines are equally effective, the opportunity for each company could be short-lived.