Moderna (MRNA 1.59%) started its billion-dollar story with the coronavirus vaccine. But the next chapter could revolve around another respiratory vaccine: one for respiratory syncytial virus (RSV). The company plans to submit its candidate for use in older adults to regulators soon and aims for a 2024 launch.
There's just one problem. The U.S. Food and Drug Administration (FDA) recently approved GSK's vaccine -- the first RSV vaccine to ever win a nod. And the FDA is set to decide on Pfizer's candidate by the end of this month. This means, by the time Moderna enters the market, these big pharma rivals probably will already be established there. Does Moderna have what it takes to match them? Let's find out.
A common and sometimes dangerous virus
First, a bit about RSV. This common respiratory virus causes cold-like symptoms and generally isn't a problem -- but it can be dangerous for babies and older adults. That's why companies have focused their resources on developing vaccines for these age groups.
From a timeline perspective, it's clear Moderna isn't in the best position. GSK plans to launch its vaccine for older adults in time for the fall vaccination season. If the FDA approves Pfizer's candidate -- also for that age group -- the pharma company probably will make it to market by that time too. And the FDA is reviewing Pfizer's candidate for use in pregnant individuals, with a decision set for August. This broadens Pfizer's market opportunity.
As mentioned above, Moderna aims to launch next year. But before we write off the biotech as being too late to market, it's important to consider this: RSV isn't just a one-time opportunity. It's a seasonal business -- and that means every year payers will consider all of the market options. If a newer vaccine has a better efficacy or safety profile, for example, it could gain considerable market share.
It's difficult to directly compare GSK's vaccine with the Pfizer and Moderna candidates. Each clinical trial is unique. But Moderna's data on overall efficacy and safety looks strong. The company reported efficacy of 83.7%. That's compared to 66.7% for Pfizer and 82.6% for GSK. And while both Pfizer and GSK reported cases of Guillain-Barré syndrome in their trials, Moderna has reported none so far.
"The profile of our vaccine as we look at the phase 3 data for our tolerability, as well as effectiveness, position us at the high end of the competitive landscape," chief commercial officer Arpa Garay said during the company's recent earnings call.
A billion-dollar market
Moderna says the potential addressable RSV market is $6 billion to $8 billion. That leaves enough room for GSK, Pfizer, and Moderna to bring in blockbuster revenue. But, if Moderna can win over payers with a strong safety and efficacy profile, it could match earlier-to-market players -- and the biotech may even have a shot at leadership.
All of this means investors shouldn't worry about Moderna arriving later to this market. Of course, GSK and potentially Pfizer will benefit this year. But, if Moderna impresses with its data, next year's vaccine season could represent a fresh start. And Moderna isn't a stranger to healthcare providers. The company has won trust thanks to its coronavirus vaccine. That could help it as it enters this new billion-dollar market.
What does that mean for you as an investor? There's reason to be optimistic about Moderna's chances in the RSV market -- even if it isn't getting there first. At the same time, the company continues to generate billions of dollars from its coronavirus vaccine. And, even better, Moderna is building out an impressive respiratory vaccine franchise. All of this means right now is a great time to buy or own Moderna shares -- and hang on for the long term.
