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How Pfizer and Moderna Could Profit Big-Time From AstraZeneca's and CureVac's Challenges

By Keith Speights - Jun 23, 2021 at 5:55AM

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Bad news for AstraZeneca and CureVac should mean more good news for Pfizer and Moderna.

In the business world, one company's pain can mean another company's gain. You can double that with recent developments in the COVID-19 vaccine market. 

AstraZeneca (AZN -0.39%) has stumbled quite a bit in recent months with its COVID-19 vaccine program. There was a new development just last week that could further complicate matters for the big drugmaker. Also last week, German biotech CureVac (CVAC 0.44%) reported a serious setback for its COVID-19 vaccine hopes.

But the problems for these two companies present major opportunities for the two leaders in the COVID-19 vaccine market -- Pfizer (PFE -1.18%) and Moderna (MRNA -3.78%). Here's how Pfizer and Moderna could profit big-time from AstraZeneca's and CureVac's challenges.

Vaccine vial with a dollar sign in it next to a syringe with needle and a vaccine vial toppled on its side.

Image source: Getty Images.

Coming in second

A year ago, it seemed that AstraZeneca might be one of the biggest winners in the COVID-19 vaccine market. However, there have been some safety concerns for the big pharmaceutical company's vaccine. AstraZeneca also ran into problems delivering the number of doses expected. This ultimately led to the European Union filing a lawsuit against the drugmaker.

Now there's another wrinkle for AstraZeneca that could directly benefit Pfizer and Moderna. Canada's National Advisory Committee on Immunization (NACI) is recommending that anyone who received a first dose of AstraZeneca's COVID-19 vaccine receive a messenger RNA (mRNA) vaccine as their second dose. 

NACI cited two reasons for this recommendation. It mentioned "emerging evidence of a potentially better immune response" from the mixed vaccine doses. The committee also said that getting a second dose of an mRNA vaccine could reduce the potential risk for blood clots.

Of course, only two mRNA vaccines are currently available -- one developed by Pfizer and BioNTech (BNTX 1.48%) and one developed by Moderna. Should other countries where AstraZeneca's COVID-19 vaccine is available follow Canada's lead, Pfizer (along with BioNTech) and Moderna could see their sales increase.

Winning from an mRNA loss

There's another mRNA vaccine candidate that seemed to have significant potential. CureVac lagged well behind Pfizer-BioNTech and Moderna but had lined up a supply deal with the EU for up to 405 million doses of its COVID-19 vaccine candidate.

However, CureVac announced last week that its experimental vaccine CVnCoV achieved an efficacy of only 47%. The company isn't throwing in the towel on CVnCoV at this point, but the future for the vaccine candidate is murky at best.

CureVac blamed the prevalence of new coronavirus variants for the low efficacy number. However, the Pfizer-BioNTech and Moderna vaccines have appeared to be highly effective even with the emergence of these variants. 

The difference in these outcomes could be that CureVac uses unmodified mRNA with its vaccine. Pfizer-BioNTech and Moderna, on the other hand, use modified mRNA in their vaccines with the goal of bypassing the body's inflammatory response to foreign mRNA. 

It remains to be seen if this different mRNA approach is the culprit for CureVac. In the meantime, though, Pfizer and Moderna probably won't have another mRNA rival on the scene anytime soon. That means the companies will likely be able to extend their dominance in the COVID-19 vaccine market.

Lots of commas and zeros

In early May, Pfizer projected sales of around $26 billion this year for its COVID-19 vaccine. Pfizer and BioNTech split profits equally on the sales. Around the same time, Moderna estimated that it would make $19.2 billion in revenue this year from its vaccine. 

That was then. Since those updates, both Pfizer and Moderna have landed more supply deals. Pfizer and BioNTech signed an agreement with the EU to supply up to 1.8 billion doses of their COVID-19 vaccine through 2023. They also inked a deal with the U.S. to provide another 500 million doses for donation to poor countries at not-for-profit pricing. Meanwhile, the U.S. plans to buy another 200 million doses of Moderna's vaccine. 

So far this year, Moderna has delivered much better results for investors with the biotech stock basically doubling compared to Pfizer's shares rising by only a single-digit percentage. But the commas and zeros in the revenue totals for Pfizer's and Moderna's vaccines could continue to grow, especially in light of the recent news for AstraZeneca and CureVac. If so, the stocks of both companies will probably move higher, too.

Keith Speights owns shares of Pfizer. The Motley Fool recommends Moderna Inc. The Motley Fool has a disclosure policy.

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Stocks Mentioned

Pfizer Inc. Stock Quote
Pfizer Inc.
PFE
$49.27 (-1.18%) $0.59
AstraZeneca PLC Stock Quote
AstraZeneca PLC
AZN
$66.03 (-0.39%) $0.26
Moderna, Inc. Stock Quote
Moderna, Inc.
MRNA
$186.84 (-3.78%) $-7.34
BioNTech SE Stock Quote
BioNTech SE
BNTX
$183.11 (1.48%) $2.67
CureVac N.V. Stock Quote
CureVac N.V.
CVAC
$13.76 (0.44%) $0.06

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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