For much of this year, BioNTech (BNTX -1.44%) and Moderna (MRNA -0.74%) stocks have soared. But shares of both vaccine makers sank on Friday, with the negative momentum carrying over into this week. 

Blame it on Merck (MRK 0.81%). The big drugmaker and its small partner, Ridgeback Biotherapeutics, announced stellar results on Friday from a late-stage study of an oral COVID-19 therapy, molnupiravir. 

Several of the leading vaccine stocks tumbled on Merck and Ridgeback's positive data. But does the sell-off of BioNTech and Moderna stocks present a great buying opportunity?

A laptop showing a stock chart trending down with two people looking at a document in the background.

Image source: Getty Images.

Yes, the sell-off is overdone

Let me first state unequivocally that I think the sell-off of vaccine stocks is overdone based on the potential threat from molnupiravir. That's especially the case for BioNTech and Moderna, which already have major supply deals in hand for 2022 and beyond.

I'm not dismissing the importance of Merck's news at all. A pill that has the potential to significantly reduce hospitalizations and deaths for COVID-19 patients will no doubt be a huge commercial success.  

But will the Biden administration suddenly decide to reverse course on vaccine mandates if Merck's pill wins Emergency Use Authorization (EUA)? Will any government across the world attempt to cancel supply deals with BioNTech (along with its partner, Pfizer) or Moderna because an oral COVID-19 therapy is available? No and no.

The financial impact from molnupiravir on BioNTech and Moderna will be minimal. Sure, some people might hold off on receiving a vaccine if a safe and effective pill is available. However, governments are the customers for vaccine makers -- and they're not going to reduce their efforts to promote vaccinations for their countries.

Prompting some reassessing

Having said all of that, I do think that the great results from Merck and Ridgeback have prompted investors to reassess the long-term growth prospects for COVID-19 vaccines. And that's a good thing.

Some investors might have blindly assumed that the tremendous sales we're seeing now for COVID-19 vaccines could go on for years. There's no guarantee that will be the case, though.

Moderna CEO Stéphane Bancel recently stated in an interview that he believes the pandemic could end next year. One possibility if he's right is that annual COVID-19 vaccine boosters will be needed. Another possibility, however, is that vaccines will be less important after 2022. In either scenario, it's likely that COVID-19 vaccine sales will be well below their current levels.

Two of the top companies with COVID-19 vaccines on the market in the U.S. -- Pfizer and Johnson & Johnson -- have plenty of other products to generate sales. Pfizer even has its own COVID-19 pill in development.

It's a much different story for BioNTech and Moderna. Both biotechs rely entirely on their COVID-19 vaccines for revenue. Neither has a pipeline candidate that's far along enough in clinical testing that it could be on the market in time to offset potential COVID-19 vaccine-sales declines after next year.

A buying opportunity?

My view is that the current sell-off of BioNTech and Moderna stocks is overdone. However, I don't think this sell-off provides a great opportunity to buy either stock. Why? I'm not convinced that the prospects for BioNTech and Moderna over the next five years justify their current valuations.

Don't get me wrong: I like both of these companies' messenger RNA (mRNA) platforms. I think BioNTech and Moderna could develop many successful vaccines and therapies over the next few decades. But it's going to take a long time for BioNTech's and Moderna's pipelines to deliver additional winners.

I'll also readily admit that my assessment could be wrong. If COVID-19 vaccine sales continue to grow after 2022 instead of decline, both of these stocks could have more room to run. Perhaps the emergence of new coronavirus variants could make this scenario a reality.

For now, though, I'll remain on the sidelines with both of these vaccine stocks. But my reasoning has nothing to do with Merck.