Pfizer (PFE 0.19%) and BioNTech (BNTX 1.63%) expect their COVID-19 vaccine will generate sales of $33.5 billion this year. Moderna (MRNA -1.22%) anticipates sales of around $20 billion this year for its vaccine. But there are some new estimates out that project those sales figures could soar in 2022 -- and even nearly double for one of the vaccines. In this Motley Fool Live video recorded on Oct. 20, Motley Fool contributors Keith Speights and Brian Orelli discuss whether or not these new projections are realistic.
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Keith Speights: Now, our next topic isn't really breaking news, but I found it interesting. TheFinancial Times reported this week about some new estimates for sales for the Pfizer-BioNTech vaccine and the Moderna COVID-19 vaccine. These estimates are projecting that sales for both of these vaccines could nearly double in 2022. The article included projected sales of the Pfizer-BioNTech vaccine of $54.5 billion and for the Moderna vaccine of $38.7 billion.
Brian, these estimates are way above what most analysts are predicting. Do you think there's any way that sales of these vaccines could really hit those targets that are reported by the Financial Times here?
Brian Orelli: This report was projections based on Airfinity. I've never actually heard of this group before.
I think, in theory, it's possible based on the manufacturing. Moderna has disclosed that it expects to have capacity between 2 billion and 3 billion doses next year. At 2 billion doses, $38.7 billion is $19.35 per dose, and 3 three billion doses, it's just $12.90 per dose. That's certainly possible to get that amount per dose. I think those prices are pretty reasonable.
The Pfizer and BioNTech's number is $54.5 billion, which I guess is theoretically possible in terms of capacity. I don't know that Pfizer and BioNTech have given out their capacity completely for 2022.
The big question is, will there actually be demand for it? I think most of the demand is going to come from developing nations. There'll obviously be some booster sales, but to get higher than the 20 billion or so that the companies will sell this year, I think you've got to expect a lot of sales in developing nations, and then that's likely to come at the lower cost, maybe closer to $13 per dose.
Therefore, margins are going to be lower, and the profits are going to be lower. While they might double the amount of sales, they're certainly not going to double the amount of profits from the sales of the vaccine I think.
Speights: I was really surprised by those estimates and everything you just said I think is exactly right, Brian. I think the increased volumes are going to come in developing nations, but that's where the price tags are going to be lower. I just think achieving those sales targets is going to be extremely difficult. I think, very unlikely. If I'm wrong, then I'm going to have to reassess my take on Moderna's valuation. I don't know about you.
Orelli: But then again, as I said, the valuation is going to be determined not by the sales but by the profits. If they are doubling the sales, but the profits are only going up 10 percent because they're selling to developing nations that can't afford to pay much more than Moderna's cost, then it's not really going to benefit Moderna all that much.
