Successful COVID-19 vaccine companies have been bringing in major revenue over the past year. Pfizer (PFE 0.18%) and Moderna (MRNA 2.74%) reported $36 billion and $18.5 billion, respectively, in coronavirus vaccine sales in 2021. And Moderna expects an even better 2022, with vaccine sales of at least $21 billion, based on the advance purchase agreements it has already signed.
But over the long term, investors need to keep vaccine sales in perspective -- and not just the coronavirus vaccines, but all vaccines. Can investors expect these preventive treatments to remain big moneymakers for the companies that make them over time?
Image source: Getty Images.
Billions of dollars in revenue
True, Pfizer and Moderna both generated billions of dollars in vaccine sales last year, and those blockbuster revenue levels may continue for some time. Experts agree that COVID-19 will continue to circulate in populations around the world long after it ceases to be a pandemic-level threat. Even in a world where the coronavirus is an endemic condition, we'll still need the protection of vaccines.
But even with last year's remarkable sales figures for coronavirus vaccines, overall vaccine revenue still made up only a small percentage of overall pharmaceutical sales worldwide -- just 8%. And that this was during the period when coronavirus vaccines were in the highest demand in many nations.
Image source: Statista.
Consider, for context, how vaccines compare to various other drug categories when it comes to revenue. Last year, vaccines (for coronavirus and others) generated more than $88 billion in sales. That put them in second place when it comes to revenue, only trailing oncology drugs.
Image source: Statista.
But based on Statista's predictions for how the health care market will look in 2026, vaccines will drop down to being the fourth-biggest moneymaker for pharma companies, with just $55.1 billion in sales.
While the chart doesn't offer an explanation for that decrease, it's likely due to an anticipated decline in coronavirus vaccine sales.
Too late to buy vaccine stocks?
Does this mean it's too late to buy vaccine stocks? Not for the long-term investor. A possible decline in COVID-19 vaccine sales doesn't mean it's all over for leaders like Pfizer and Moderna. Moderna, for example, is working on several options for the future: strain-specific boosters and a combined flu/coronavirus vaccine, to name just two. Even if its future coronavirus vaccine doesn't generate $20 billion annually, revenue from it still could remain at blockbuster levels.
And it's important to consider these companies' pipelines and product portfolios. Moderna just brought two potential blockbusters into pivotal clinical trials -- vaccine candidates for cytomegalovirus and respiratory syncytial virus. Big pharma Pfizer has nearly 90 candidates in its pipeline and several blockbuster drugs already on the market.
So even if vaccine sales only represent a small part of overall pharmaceutical industry revenue, no need to worry. It's essential to look at the revenue picture of each individual company. And for companies such as Moderna, vaccines -- for COVID-19 or other indications -- may power growth well into the future.
