Editor's Note: This article has been updated to reflect that approved vaccines contain inactivated viruses, live but weakened viruses, or proteins that activate the immune response, and approved vaccines are not DNA-based.

There are well over 100 separate COVID-19 vaccines in development at the moment. While many of the largest names in the healthcare industry have jumped at this opportunity to develop a vaccine, smaller, less-well-known companies are actually leading the way in this area.

Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases (NIAID), has singled out Moderna (NASDAQ:MRNA) and its COVID-19 vaccine candidate as being especially promising. What makes Moderna's COVID-19 vaccine so special, and is the company worth a spot in your investment portfolio?

COVID-19 test vial with a needle and a stack of American currency in the background.

Image source: Getty Images.

What did Fauci say?

While still somewhat cautious, Fauci went on to say that Moderna's vaccine results have surpassed his expectations. In a statement on May 22, Fauci said: "The vaccine induced what we call neutralizing antibodies, as opposed to just binding antibodies, and neutralizing antibodies are antibodies that actually can block the virus. Having looked at the data myself, it is really quite promising." He added that the results ended up being "even better than we thought" even at the more moderate doses seen in the clinical trial in question.

Moderna's candidate, mRNA-1273, first began phase 1 trials with NIAID back in March. It was also one of the very first vaccine candidates to begin clinical testing, which it did alongside another small-cap vaccine developer, Inovio Pharmaceuticals.

While the complete trial data set hasn't been released yet, what we know so far about the results seems very positive. For one, there were no severe adverse reactions at all, with the only incident being a rash on the injection site of one patient. The vaccine proved effective in triggering sufficient antibody response in patients as well, which helps prevent the virus from spreading throughout the body.

What makes this vaccine so special?

Moderna's COVID-19 vaccine uses a new type of technology not seen before in the world of vaccinations. Whereas currently approved vaccines contain inactivated viruses, live but weakened viruses, or proteins that activate the immune response, mRNA-1273 targets the mRNA (or messenger RNA) of the cell instead.

mRNA is like the cell's courier service, copying information from the nucleus (where the DNA is stored) and then transporting it to the rest of the cell. That means that mRNA is much easier to access given its presence all across the cell, compared to another investigative vaccine technology called a DNA-based vaccine (Inovio Pharmaceuticals has a candidate in the clinic) that need to get to the nucleus to access the cell's DNA.

As such, vaccines built on mRNA-based technology could end up becoming more effective than DNA-based candidates due to the ease of accessing mRNA. At the moment, Moderna is one of the only companies on the market that is exclusively focused on mRNA technologies, and it is considered a leading company in this space.

Needle and a vaccine bottle.

Image source: Getty Images.

The rest of Moderna's pipeline

While the excitement surrounding its COVID-19 vaccine is what has propelled this meteoric rise, the company still has plenty of other things going for it. Its drug pipeline includes 23 candidates in total (including mRNA-1273) across a variety of medical conditions. This includes a number of cancer vaccines, as well as some prophylactic (preventative) treatments for viral infections like the cytomegalovirus and the Zika virus.

All of its candidates are still in the earlier stages of clinical development, with only three candidates having entered phase 2 trials as of right now. This includes Moderna's cytomegalovirus vaccine (mRNA-1647), a personalized cancer vaccine (mRNA-4157), and a myocardial ischemia treatment (VEGF-A) for a condition in which a blocked artery prevents blood flow to the heart muscle.

Is Moderna worth a spot in your portfolio?

Around a year ago, Moderna was a mid-cap stock with a market cap of around $5 billion. Over the past few months, however, share prices have multiplied, and Moderna's market cap now sits at around $27 billion.

While the laws of probability state that most early-stage candidates end up failing to pass clinical trials, Moderna only needs to hit one or two home runs to become a major success. Although there's plenty of competition in the COVID-19 vaccine space right now, Moderna's mRNA-1273 is among the leading candidates so far in clinical development.

One downside to Moderna is that it's still not making a profit. First-quarter results saw a $124.2 million net loss, with revenue of just $8.4 million. However, that's par for the course when it comes to clinical-stage biotech stocks. As long as Moderna has enough cash to finance its operations (with more than $1.7 billion in cash, it does), investors shouldn't worry too much about revenues or losses at this stage.

Nothing's ever certain in the world of biotech, and candidates that seemed promising in early clinical testing often fail to pass the more stringent late-stage trials. However, with its 23 candidates in development, Moderna has a pretty good chance of finding success somewhere. If you're looking for a high-growth, high-risk stock that's also making waves in the coronavirus world, I think that Moderna is a good company to invest in right now.