There were plenty of important numbers in Moderna's (MRNA -0.24%) most recent earnings report. And many of them had to do with the billions of dollars the company's coronavirus vaccine is generating. For example, the company reported $18.5 billion in 2021 revenue and $12.2 billion in profit. And Moderna forecast vaccine revenue of $19 billion for this year according to advance purchase agreements signed so far.
But there was one particular number in Moderna's report that could translate into billions of dollars in revenue over the long term. And this number is "three." Let's take a closer look at how this single number could represent so much for Moderna's future.
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The number three
What does "three" refer to? Well, it isn't a number on the operations statement or balance sheet. Instead, it refers to the number of potential commercialized products on the horizon.
"This is our third vaccine starting the phase three," CEO Stéphane Bancel said during last week's earnings call. He referred to the company's investigational respiratory syncytial virus (RSV) vaccine. The company recently began a pivotal trial for the candidate.
Moderna launched a pivotal phase 3 trial for its cytomegalovirus (CMV) vaccine candidate a few months ago. And the third phase 3 refers to the coronavirus vaccine. It's already passed that stage and won regulatory approval -- but the vaccine is involved in a phase 3 study right now for the teen age group.
Here's why the number three may mean billions for Moderna down the road. Right now, the company depends on the coronavirus vaccine for all of its product revenue. Experts predict the virus will stick around well beyond the pandemic. So, coronavirus vaccine revenue is set to continue at a high level. But if all goes well in today's phase 3 programs, RSV and CMV vaccines may drive more blockbuster revenue for the company in the coming years.
An integral part of a pan-respiratory vaccine
An RSV vaccine could become an integral part of Moderna's eventual pan-respiratory vaccine. The company aims to create a one-shot annual booster that would combine protection against the flu, coronavirus, and RSV. RSV is a common virus that could be especially dangerous for infants or the elderly. It's the most common cause of pneumonia in babies under the age of 1 in the U.S., according to the Centers for Disease Control and Prevention. The market for a potential RSV vaccine is expected to reach $6.3 billion by 2030, a Global Data report shows. Right now, there isn't a RSV vaccine that can be broadly used in those who most need it.
A CMV vaccine also could bring in billions of dollars. Moderna has forecast peak annual revenue of $2 billion to $5 billion. Like RSV, CMV is a common respiratory virus that can be particularly dangerous for some individuals -- in this case, it's unborn babies and people with weakened immune systems. Today, a vaccine for CMV doesn't exist.
Why is the launch of phase 3 particularly important right now? Because investors aren't thrilled with the idea of Moderna being a one-product company for the long term. Especially since it's difficult to predict exactly how much that product will generate in the future. So, the idea that two potential blockbusters may be on the way is encouraging -- and reassures investors that Moderna may continue to bring in billions of dollars in revenue and profit over the long term.
Of course, anything can happen during clinical trials. Even during late-stage trials. Moderna, like all vaccine makers, faces the possibility of failure. That is a risk investors must accept if they decide to invest in shares of biotech or pharma companies. But, if all goes smoothly in Moderna's current phase 3 studies, the number "three" just may be a lucky one for Moderna -- and for the company's investors.
