Please ensure Javascript is enabled for purposes of website accessibility

How Serious Are Moderna's FDA Delays?

By Keith Speights and Brian Orelli, PhD – Nov 12, 2021 at 6:14AM

Key Points

  • The FDA is taking longer to review Moderna's EUA filing for adolescents due to potential safety issues.
  • Moderna pushed back its filing in younger kids as a result of this longer review period.
  • These delays shouldn't present major problems for Moderna.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Moderna won't win authorization for its COVID-19 vaccine in kids as soon as it hoped.

The U.S. Food and Drug Administration (FDA) will take longer than expected to complete its review of Moderna's (MRNA -2.01%) Emergency Use Authorization (EUA) for its COVID-19 vaccine in adolescents ages 12 to 17. Moderna is pushing back its filing for EUA in younger children while this review moves forward. In this Motley Fool Live video recorded on Nov. 3, 2021, Motley Fool contributors Keith Speights and Brian Orelli discuss how serious these FDA delays are for Moderna.

10 stocks we like better than Moderna Inc.
When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*

They just revealed what they believe are the ten best stocks for investors to buy right now... and Moderna Inc. wasn't one of them! That's right -- they think these 10 stocks are even better buys.

See the 10 stocks

 

*Stock Advisor returns as of October 20, 2021

 

Keith Speights:: Moderna announced on Sunday that the FDA is going to take longer to complete its review of the Emergency Use Authorization filing for its COVID-19 vaccine in adolescents ages 12-17. The company also said that it's going to hold off on filing for EUA in younger kids ages 6-11 while the FDA completes this review in the adolescent age group.

Brian, how serious of a setback do you think this is for Moderna?

Brian Orelli: I was a little worried. I first saw the headline that it was going to say, "Brian Orelli's kids didn't fill out their e-diaries to report their side effects." But apparently, this is a clinical trial that my kids were in. Apparently, it wasn't my kid's fault that the decision is being delayed.

Speights: Don't blame it on the Orellis!

Orelli: [laughs] The FDA says it may take until January to make this decision. The agency wants to evaluate recent international analysis of risk of myocarditis, which is inflammation of the heart muscle after vaccinations with mRNA drugs. As the infection rate goes down, the risk of not getting vaccinated also goes down.

You're less likely to get sick getting in the hospital from COVID-19, but the risks of side effects stays the same. At some point, the risks of side effects basically are justified by whatever you're saving if the COVID-19 infection rates go down low enough. That's the reason why we stopped giving smallpox vaccinations in the US long before it was truly wiped out in all of the world because it was just your chance of getting it here in the US was so low that it wasn't important for everybody else to get it.

How serious this is for Moderna? I don't really think that the side effect issue is really that big of a deal. If they're pretty uncommon and when they do happen, they're fairly mild. Out of decent infection rate that you're going to get, the benefit of the vaccine is going to outweigh the issues with the side effects.

I think that, in general, Moderna's OK. I think that the issue is that investors should be a little more worried about the infection rates going down low enough. Because if the infection rates go down low enough, you're not going to sell those vaccines because people aren't going to take them because the infection rates are down low enough. At the point where we get to the point where the side effects are too severe to justify taking the vaccine, you're also not going to be selling much vaccine because the infection rates are so low that nobody's really worried about COVID-19 anymore.

Speights: We're looking at, you're saying it could be January before the FDA makes a decision. That's not far away. We're talking about probably a couple of months or so, two or three months. The bigger story here, at least over the short term is Moderna really isn't going to sell any more doses of its vaccine even if it gets this EUA, not in the short term, right?

Orelli: Right, yeah. Looking at 2022 sales or 2023 sales, those are what's important for Moderna's valuation right now. The 2021 sales are already priced into the valuation, as well [laughs] as some quite a few sales in 2022 and 2023. That's what investors should be focused on. Therefore, that's the reason why I say you should be focused on the infection rates because if the infection rate goes down low enough then those sales aren't going to materialize.

Keith Speights has no position in any of the stocks mentioned. The Motley Fool recommends Moderna Inc. The Motley Fool has a disclosure policy.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.