What happened
Shares of Moderna (MRNA +1.16%) were down 3% as of 10:53 a.m. ET on Thursday after having been off by as much as 5.9% earlier. This move continued a downward trend that began Monday with concerns easing about the potential impact of the omicron variant of COVID-19.
This week, data readouts from three separate studies pointed to lower hospitalization rates for the omicron variant compared to earlier coronavirus strains. Also, the Food and Drug Administration (FDA) granted Emergency Use Authorization to Pfizer's (PFE +3.14%) COVID-19 pill on Wednesday, and to Merck's (MRK +0.32%) COVID-19 pill Thursday.
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So what
The combination of those study results and the FDA authorizations for oral COVID-19 therapies presents a double whammy for vaccine stocks other than Pfizer.
A scenario where the omicron variant is more severe would likely lead to an opportunity for Moderna to sell even more doses of its current vaccine, as well as an eventual version of that vaccine that specifically targets omicron. The availability of COVID-19 pills could provide a disincentive for some people to be vaccinated or get booster shots -- even though that's clearly not what the federal government wants to happen.
However, it's too soon to know for sure what impact the omicron variant will have in the U.S. Also, the availability of Pfizer's and Merck's COVID-19 pills will be limited in the near term.
Now what
Moderna's fortunes going forward will primarily hinge on two things -- additional orders for its COVID-19 vaccine and the company's pipeline progress. Those vaccine sales will likely be more important in 2022. Waning concerns about the omicron variant might seem like bad news for Moderna now. However, the dynamics of the pandemic could change quickly.
