What happened

Shares of Moderna (MRNA -3.58%) climbed on Monday, following news that the biotech company had begun its phase 3 study of its COVID-19 vaccine candidate and received additional funding from the U.S. government.

By the close of trading, Moderna's stock price was up more than 9%.

So what 

Moderna disclosed on Sunday that the Biomedical Advanced Research and Development Authority (BARDA) would provide it with up to $472 million in additional funding to further the development of its experimental COVID-19 vaccine, mRNA-1273. Combined with BARDA's previous commitment for $483 million, Moderna has now been awarded a total of $955 million in U.S. government funding. 

People in lab coats working in a laboratory.

Moderna's stock rose sharply on Monday. Image source: Getty Images.

On Monday, Moderna said that it had begun dosing participants in its phase 3 study for mRNA-1273. The National Institute of Allergy and Infectious Diseases (NIAID) will work with Moderna to conduct the randomized, placebo-controlled trial, which is expected to include as many as 30,000 participants. 

Now what

It would be a boon for Moderna -- and its shareholders -- if its experimental vaccine proves both safe and effective against COVID-19. Moderna said it will be capable of producing roughly 500 million doses per year -- and possibly up to 1 billion doses per year -- starting in 2021, due in part to the supply and manufacturing deals it has in place. 

Still, while early results for Moderna's COVID-19 vaccine candidate have been promising, there's still the risk that the drug's phase 3 trial will be unsuccessful.

Moderna CEO Stephane Bancel, however, remains undaunted. "We look forward to this trial demonstrating the potential of our vaccine to prevent COVID-19 so that we can defeat this pandemic," Bancel said.