Moderna's (MRNA 2.43%) coronavirus vaccine revenue has been more than great so far. The company reported $18.5 billion in vaccine revenue last year. And the biotech predicts it will generate at least $21 billion in revenue this year; that's according to advance purchase agreements signed so far.
Still, investors are starting to worry about what's next. Experts say that COVID-19 could shift from pandemic to endemic as soon as this year. At that point, the coronavirus will continue to circulate -- but infection rates won't peak as they've been doing over the past two years. Does this mean Moderna's vaccine revenue is set to drop off a cliff? Let's check out the following charts for a couple of clues.
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Fighting coronavirus variants
New variants of concern have kept vaccine makers busy in recent times. Today's vaccines are working against those variants -- but not as well as everyone would like, including vaccine makers. That's why Moderna is developing strain-specific boosters. The company has moved candidates targeting the beta, delta, and omicron variants into phase 2 trials. The idea is to quickly update coronavirus boosters down the road with the appropriate strain(s) -- or produce a booster that will work against any future strain. Coronavirus vaccination, much like flu shots, could become an annual thing.
Now, let's have a look at our first chart. It shows the omicron BA.2 variant on its way to becoming dominant in the U.S. The Centers for Disease Control and Prevention (CDC) predicted about 35% of newly detected coronavirus cases would be of the BA.2 type by March 19, up from about 15% on March 5. And in fact, the CDC recently said that BA.2 now is indeed the dominant variant in the U.S., responsible for 54.9% of new cases. All of this shows that we continue to deal with the emergence of new variants.
What might be next
The second chart shows how prepared the world is to prevent another pandemic -- and things don't look good. The Global Health Security Index gives scores from 1 to 100, with 100 being the best score, in various areas. The world earned a score of less than 40 in several key categories. These include prevention, rapid response, and ability of the healthcare sector to manage the crisis:
These charts indicate that vaccine sales may not slow down right away. The continuing emergence of variants of concern is a reminder that we still need vaccination to protect against COVID-19, and even updated vaccines to better handle these new versions of the virus. And the fact that the world is poorly prepared for the next pandemic may make governments think twice before halting vaccine orders. This information could make them more cautious -- and that would favor vaccine stockpiling.
This doesn't mean Moderna will report $20 billion in vaccine revenue every year, but vaccine sales probably won't sink like a stone either. The company could continue to generate a blockbuster level of revenue from coronavirus vaccine products for quite some time. And that's great news for Moderna investors.
