(MRNA) Archives - Page 14 of 27 - Mad Hedge Fund Trader

Let the Biotech Buyouts Begin

One of my predictions for this year just came true: the biotechnology buyouts have begun.

In my letter last January, I forecasted that the growing popularity of the mRNA technology courtesy of the COVID-19 vaccines from Moderna (MRNA) and Pfizer (PFE / BioNTech (BNTX) would trigger acquisitions of smaller biotechnology companies this year.

I predicted that bigger players in the healthcare industry would scoop up smaller players to stake a claim in this quickly growing space.

Topping our list of buyout candidates is Translate Bio (TBIO)—the very same company hogging headlines in the past days following its $3.2 billion acquisition by Sanofi (SNY).

The all-cash deal values each TBIO share at $38, representing a premium of over 30% above the stock’s price. If all goes well, the deal should be completed by the third quarter of 2021.

This is one of the first major moves by Sanofi following the healthcare giant’s recent pivot into vaccines.

However, this isn’t the first time Sanofi and TBIO worked together.

The two companies have actually started collaborating back in 2018, working on a potential mRNA-based flu vaccine—a project that has Sanofi and TBIO ahead of the pack, with BioNTech and Arcturus Therapeutics Inc. (ARCT) trailing behind.

Sanofi and TBIO’s mRNA seasonal flu vaccine candidate is expected to commence with Phase 1 results expected to be out by the fourth quarter of this year.

Considering that Sanofi is one of the leading vaccine makers in the world with roughly $3 billion in sales in flu vaccines alone in 2020, it won’t come as a surprise if their candidate breezes through the trials.

Even prior to this acquisition, Translate Bio has been working on using its mRNA platform to develop vaccines and treatments for a broad range of diseases like liver and pulmonary ailments.

So far, its novel pipeline has 2 clinical-stage programs along with 7 pre-clinical work covering direct therapeutics and vaccines.

One of its lead candidates is MRT5005, which is an mRNA-based therapy for cystic fibrosis (CF).

This is a groundbreaking treatment because it takes advantage of mRNA’s capability to deliver proteins to lung cells. It’s also extremely non-invasive, as patients can simply inhale the mRNA drug into their bodies.

Other than helping with the treatment of CF, this inhalation delivery system can also open avenues for other pulmonary targets.

Most importantly, TBIO’s MRT5005 doesn’t only offer treatments. It actually is a cure for CF.

TBIO’s work on CF treatment is extremely important. This disease is terrible, recording a median age of death among patients in the US as 30.6 years old. In this country alone, over 30,000 people suffer from the condition, and more than 70,000 are recorded worldwide—and the numbers continue to climb each year.

In terms of the CF market, the global demand for treatments for this disease is expected to reach $16.3 billion by 2026, hitting roughly 16.8% in CAGR over the years.

With the acquisition of Translate Bio, Sanofi plows ahead of its competitors in the space, including Pfizer, GlaxoSmithKline (GSK), Johnson & Johnson (JNJ), and Merck (MRK), as the sole Big Pharma company with a wholly-owned in-house mRNA platform.

This is on top of Sanofi’s recent $470 buyout of another mRNA company, Tidal Therapeutics, to bolster its immuno-oncology and inflammatory diseases segments.

Apart from its aggressive buyout strategy, Sanofi also announced its plan to allocate roughly $476 million annually to a “vaccines mRNA Center of Excellence” with the goal of queuing at least six mRNA-based candidates in clinical trials by 2025.

Allotting $476 million to this plan is a telling move on the company’s future direction, as it comprises a substantial fraction of Sanofi’s $6.5 billion overall R&D budget.

These moves strongly signal that Sanofi’s going all-in on the mRNA platform, which could obviously pose a challenge to the likes of Moderna and, of course, BioNTech.

With smaller cap companies like bluebird Bio (BLUE) and CureVac (CVAC) still up for grabs, it’s only a matter of time before another big company decides to follow suit.

July 29, 2021

Biotech Letter

Mad Hedge Biotech & Healthcare Letter
July 29, 2021
Fiat Lux

FEATURED TRADE:

(A BIOTECH PREPARED FOR ANOTHER DOOMSDAY MARKET)
(BNTX), (PFE), (MRNA), (AZN), (JNJ), (GSK), (GILD)

A Biotech Prepared for Another Doomsday Market

Biotech Letter

If you’ve heard of Harry Dent Jr., then you know that he’s the economist who correctly and accurately forecasted the Japanese economic downturn back in 1989. He also hit the nail on the head when he predicted the collapse of the dot.com bubble in 2000.

Now, he’s saying that the stock market will crash in the next three months, describing it as “the biggest crash of our lifetime.”

There’s no precise method to determine if his pessimistic outlook is justified thus far.

Nonetheless, even if Dent turns out to be right, I don’t believe that all stocks will plummet. There are a handful of stocks that could soar if the stock market does crash this summer.

For instance, I think vaccine stocks would most likely take off if the new variants of COVID-19 triggered a market crash in the coming months.

After all, the best weapons we have in overcoming these issues are still vaccines.

I also think that one of the biggest—if not the biggest—winners in this segment is BioNTech (BNTX).

Let me share with you the reasons.

For one, BioNTech is actually the smallest of the biopharmaceutical companies in the vaccine market today.

Catalysts typically generate larger swings in stocks that hold smaller market capitalizations compared to those with bigger market caps.

It’s also telling that BioNTech and its co-vaccine developer, Pfizer (PFE), have started delving into tactics to handle the continuous rise of the Delta variant.

So far, what the partners have suggested includes adding a third dose to the COVID-19 vaccine to boost the immunity and protection of people against the new strain.

The two are also looking into beginning their clinical testing on a modified version of their vaccine, which would specifically target the Delta variant, by August.

BioNTech’s valuation also plays a key role. The company so far is the cheapest among the leading vaccine stocks, which include Moderna (MRNA) and AstraZeneca (AZN), based on its forward earnings multiples.

To date, BioNTech trades at roughly 6.3 times its expected earnings—a low valuation that wouldn’t last long, especially if fears about the new variants spark another massive downturn in the market.

Thus far, BioNTech and Pfizer have delivered roughly 392 million vaccine doses to the US alone.

However, the country is anticipating increasing demand for it, pushing it to sign up for an additional 200 million doses.

The duo plans to deliver 110 million doses to the US by the end of 2021 and the rest of the orders by April 2022.

In a separate agreement, the US also ordered 500 million doses as donations to developing countries across the globe.

In comparison, Moderna delivered 137.3 million, while Johnson and Johnson (JNJ) supplied 13.1 million.

On top of these, Pfizer and BioNTech are working to expand the reach of their vaccine.

The companies recently sealed an agreement with Biovac, a company in South Africa, to produce vaccine shots from a plant in Cape Town. Similar initiatives are under exploration in Latin America.

Riding the momentum of its COVID-19 vaccine, BioNTech is also working to develop a highly effective and widely tolerated malaria vaccine.

The malaria vaccine candidate is expected to build on two decades’ worth of mRNA research, which BioNTech used to co-develop the COVID-19 vaccine with Pfizer.

The clinical trial for this new project is planned to start by the end of 2022.

At this point, only one malaria vaccine is available on the market: GlaxoSmithKline’s (GSK) Mosquirix, which offers about 30% effectiveness in safeguarding kids from the mosquito-borne virus.

If successful, BioNTech will be easing a massive burden globally, as over 400,000 children die from malaria every year.

In addition to its malaria vaccine candidate, BioNTech is also looking into using its mRNA expertise to diversify its pipeline to include cancer treatments, including colorectal cancer, advanced melanoma, and other malignant solid tumors.

BioNTech’s move to attempt to conquer the oncology sector gained even more traction following its recent acquisition of Kite, a manufacturing plant under Gilead Sciences (GILD).

Kite primarily focuses on an experimental kind of cancer treatment relating to neoantigen T-cell receptor cell therapy.

In the first quarter of 2021, BioNTech was able to boost its sales by over 7,295%.

Its total revenues within that period reached $2.49 billion, which indicates a healthier revenue stream compared to its main competitor, Moderna, which raked in $1.9 billion.

In terms of sales outlook for the entire year, BioNTech also forges ahead with $26 billion, while Moderna anticipates $19.2 billion.

Needless to say, these numbers show how undervalued BioNTech has been lately.

Given the new developments concerning the new variants and the company’s expanded coverage of the market, it’s clear to see that the future looks bright for BioNTech regardless of Dent’s doomsday market predictions.

July 27, 2021

Biotech Letter

Mad Hedge Biotech & Healthcare Letter
July 27, 2021
Fiat Lux

FEATURED TRADE:

(A RESURGENCE STOCK READY FOR THE NEXT WAVE)
(MRNA), (PFE), (BNTX), (JNJ), (NVAX)

A Resurgence Stock Ready for the Next Wave

Biotech Letter

What truly scares investors isn’t really the potential relapse of the financial metrics that would undoubtedly take center stage again since the earnings season already commenced.

As we have been recently reminded, the world’s worst nightmares still place the COVID-19 virus front and center—this, despite the pandemic supposedly already under control.

COVID cases are starting to rise again, and the delta variant is seen as the latest addition to the problem.

That strain has actually become dominant in the United States, sending unvaccinated individuals to hospitals faster than its predecessor.

This delta variant is said to be more contagious than the previous virus. In fact, the fear over this new wave is incredibly high that the US government decided to issue a “Do Not Travel” advisory for the UK, which has been suffering from outbreaks despite their high vaccination rates.

If this is yet another indication of another disastrous year like 2020, then stocks would most certainly fall.

However, stocks managed to bounce back after the initial scare.

While this sparked a debate on the reason behind the recent sharp losses, investors are encouraged to remain focused on how the virus can still affect their lives despite the strong temptation to believe that the stock market will continue to rise from here.

Vigilance is the key to survival these days. It’s critical to bear in mind that the virus that upended our world and forced us to shutter our economies may not be in retreat just yet.

After all, even paranoids have enemies.

That’s what makes the mRNA vaccines a promising answer to this new issue.

Moreover, against this volatile environment, one stock looks to be extremely intriguing: Moderna (MRNA).

Amid the analyses and reports, the most consistent thing about Moderna—and the most notable quality it has—is its solid science.

At its core, mRNA technology can transform the cells in a person’s body into mini-factories with the ability to produce virtually any kind of protein that Moderna wants.

So when people get inoculated with mRNA-1273, the mRNA instructs the body’s cells to start producing inactive replicas of COVID-19 proteins.

Then, the body’s immune system responds to those replicas.

This process effectively teaches the person’s immune system how to protect itself and fight off any type of exposure to the COVID-19 virus proteins.

Moderna’s vaccine is based on mRNA technology, which is primarily an information molecule. This means that this could be used to create various products, which would reach better technical success over time.

Basically, one major benefit of mRNA is that the chemistry behind the formulation for treatments like the flu shot uses exactly the same when creating more advanced products like the COVID-19 vaccine or even the HIV vaccine.

This makes it easier for Moderna to keep developing vaccines and other treatments because the company no longer needs to implement major changes in its manufacturing system for every new drug.

This is incredible leverage for Moderna, particularly across its manufacturing infrastructure and R&D. With the money saved on this advantage, Moderna can make massive investments in other segments like IT and marketing.

In fact, their quickness to market their vaccine is one of the reasons for Moderna’s success in the COVID-19 vaccine race.

Over the course of the last 52 weeks, Moderna stock has performed within the range of $54.21 to $342.51. The stock also managed to sustain its momentum from the surge of investor interest last year and is up by 207% so far this 2021.

In ensuring that it doesn’t get too far behind the leader, Pfizer (PFE)-BioNTech (BNTX), it secured a huge chunk of the market share as well.

Now, there’s a new virus strain threatening to take down everything we’ve worked hard to rebuild since the first COVID-19 case broke last year. This could mean an additional revenue stream for Moderna considering that it can deliver at lightning speed compared to other developers.

Aside from its work on COVID-19, Moderna is also looking for ways to use mRNA technology to develop treatments for heart failure, cancer, and other severe conditions.

To date, Moderna has roughly 24 mRNA-based programs in its pipeline, ranging from the Zika vaccine to cancer treatments.

Admittedly, buying Moderna stock presents risks. However, the greed and fear that continue to rule the markets places Moderna in a unique position to be the answer to all the questions.

Moderna is estimated to rake in $18.8 billion in revenue for 2021, thanks largely to its COVID-19 vaccine, with the number expected to rise as the company ramps up production to reach 3 billion doses in 2022.

Moderna’s dominance today doesn’t necessarily mean it’ll last forever, especially with competition coming in from Johnson & Johnson (JNJ) and Novavax (NVAX).

However, the technology it uses and the fact that it’s one of the only two biotechnology companies that successfully executed the mRNA place Moderna in an extremely unique, profitable, and secure position for the foreseeable future.

July 1, 2021

Biotech Letter

Mad Hedge Biotech & Healthcare Letter
July 1, 2021
Fiat Lux

FEATURED TRADE:

(NOT YOUR AVERAGE ONE-HIT WONDER)
(BNTX), (MRNA), (PFE), (REGN), (DNA)

Not Your Average One-Hit Wonder

Biotech Letter

It was only a few months ago when investors believed that COVID-19 developers like Moderna (MRNA) and BioNTech (BNTX) had enjoyed their best performances.

With the uncertainty returning, many figured that the profits and revenues for these stocks have dried up as well.

This isn’t the case these days, though. If anything, it looks like these companies have incredibly bright futures ahead.

BioNTech, in particular, shows tremendous promise after emerging as one of the most compelling success stories in the scientific world during the pandemic.

Working alongside Pfizer (PFE), this German biotechnology company created the first-ever vaccine that utilized messenger RNA to receive authorization across the globe.

Since being a first mover in the COVID-19 vaccine race, BioNTech has established a strong financial position that gave it the capacity to pursue other breakthrough treatments in its pipeline.

Moreover, the general sentiment toward BioNTech remains positive thanks to the effectiveness of its vaccine.

Just last month, the US Centers for Disease Control and Prevention disclosed the latest data on the efficacy of mRNA-based vaccines. It showed an impressive 91% reduction rate in terms of infections based on real-life reports.

The sustained demand for COVID-19 vaccines also translated to an outpouring of orders, with BioNTech recently completing another agreement with New Zealand and even the Philippines.

Health officials are also looking into the need for booster shots, which means it’s entirely possible that a whole new revenue stream could open up for BioNTech once again.

In the first quarter of 2021, revenues from BioNTech’s share from the COVID-19 vaccine marketed alongside Pfizer amounted to over $3.5 billion, including milestone payments.

This puts it on track to reach the $8.3 billion revenues estimated from the vaccine alone in 2021.

Apart from its agreement with Pfizer, this German biotech has been ramping up its own production. So far, it anticipates selling roughly 250 million doses of the COVID-19 vaccine in the first half of 2021.

Let’s say that each dose is sold at $14, and BioNTech could sustain its manufacturing capacity until December, then it can supply a total of 500 million doses.

That would rake in $7 billion in direct revenue.

On top of these, BioNTech has a separate deal with China’s Fosun Pharma.

This means that the earlier estimate of $15 billion in revenue for BioNTech this year is definitely feasible.

However, that’s a conservative estimate.

BioNTech intends to expand its manufacturing capacity to produce 3 billion doses by the end of 2021 and more by 2022.

By next year, the entire world comprising 7 billion people would be eligible to take the vaccine shots as approvals get rolled out.

Even with the competition, BioNTech stands to cover at least 30% market share or roughly 2 billion doses in the years to come.

Despite the expected price reduction to probably $10 per dose, that’s still a whopping $20 billion in annual sales for a biotechnology company with a current market capitalization of $54.10 billion.

Going back to its current deals with bigger biopharmaceutical companies, BioNTech had an impressive first quarter this year, showing off a 7,295% surge in its sales.

Leveraging this massive revenue stream, the company has boosted its pipeline programs and is pushing to ride the momentum.

So far, it has 14 drug candidates queued in clinical trials.

One of the most promising and advanced is its melanoma treatment pipeline, which has two programs slated to advance to Phase 2 within the year.

The first one, BNT111, is a collaboration with Regeneron (REGN), while the other, BNT122, is an approach developed alongside Genentech (DNA).

Aside from these programs, the company has also been busy working on developing mRNA-based treatments for various types of cancers.

If you’re one of the people who thought that the rise of the COVID-19 vaccine stocks is done the moment the entire US population gets vaccinated, then you’re not alone in that assumption.

You’d be surprised though at the strength of the staying power of companies like BioNTech have, especially when some things work out in their favor.

For context, BioNTech is only second to Volkswagen (VWAGY) in terms of profitability in Germany.

That means that a 13-year-old biotech company with fewer than 2,000 employees has grown so much in the past year that it’s now in the same conversation with a company employing over 600,000 people and has a history that predates World War II.

While COVID-19 upended the world, BioNTech has been granted the opportunity to show off its skills and grow its business

From being a virtually unknown company, it has become one of the fastest-growing biotech globally.

Looking at its performance in the past 12 months and its pipeline programs, it’s clear that BioNTech still has so much room for growth.

June 10, 2021

Biotech Letter

Mad Hedge Biotech & Healthcare Letter
June 10, 2021
Fiat Lux

FEATURED TRADE:

(IN THE RIGHT PLACE AT THE RIGHT TIME)
(MRNA), (PFE), (BNTX), (NVAX), (CVAC), (SNY), (TMO), (CTLT), (BAX), (INO)

In the Right Place at the Right Time

Biotech Letter

Before the COVID-19 pandemic, only a handful of people had actually heard of messenger RNA (mRNA).

Now, this technology has become a household term thanks to the success of the COVID-19 vaccine programs of Pfizer (PFE), BioNTech (BNTX), and Moderna (MRNA).

Aside from these three names, other players in the mRNA arena include Novavax (NVAX) and an under-the-radar stock called CureVac (CVAC), which has been collaborating with Bayer (BAYRY).

Even Sanofi joined the list recently with its acquisition of mRNA-focused biotechnology company Tidal Therapeutics.

Amid the growing number of mRNA-focused companies, however, the world has come to associate the technology most with Moderna.

This is apparent in the increasing demand for Moderna’s COVID-19 vaccine, which has been pushing the biotech company to quickly expand its manufacturing capacity.

One of the steps it took to meet the supply expectations is to partner with Thermo Fisher (TMO), specifically for fill-finish, labeling, and packaging.

For orders outside the United States, Moderna established a partnership with South Korea’s renowned Samsung Biologics (KRX: 207940) to keep up with the demand.

While TMO and Samsung Biologics are the two major forces helping Moderna in its manufacturing concerns, other companies are also pitching in, including Catalent (CTLT), Sanofi, and Baxter BioPharma Solutions (BAX).

With the assistance of these companies, along with the major expansion of its own manufacturing site, Moderna anticipates that it can supply at least 3 billion doses of its COVID-19 vaccine annually by 2022.

This is promising news, particularly in light of another massive market that Moderna can conquer next: India.

While the United States has managed to turn the corner in the COVID-19 battle, India has been struggling to fight back against the virus. To this day, the country continues to grapple with the increasing number of COVID-19 cases.

Low and sluggish vaccination rates are considered the major contributing factor to this problem, with a measly 3.3% of India’s citizens getting fully vaccinated so far.

With a population of approximately 1.39 billion, this offers a massive opportunity for vaccine developers.

Thus far, only 228 million doses of the COVID-19 vaccines have been shipped to India. That leaves about 1.16 billion people in this huge country to receive a vaccine.

Since India is a developing nation, vaccine makers are expected to charge the low end of their range.

For Moderna, that would be roughly $25 per dose, while Pfizer would probably charge $19.50 per dose.

However, these prices could still go lower depending on the contract negotiated by the Indian government.

Even at the low end of the price point though, the Indian market represents approximately $28 billion in revenue for COVID-19 vaccine developers.

Taking advantage of this momentum, Moderna has been working on booster candidates for its COVID-19 vaccine. In fact, one candidate may be ready by fall.

Of course, competitors are looking into the new variants as well. Aside from Pfizer, smaller companies like Inovio Pharmaceuticals (INO) have started with clinical trials this year.

Moderna is also investing heavily in artificial intelligence (AI) in an effort to become a step ahead of future diseases.

Through AI and machine learning, Moderna aims to predict strains that evade protection provided by their roster of vaccines.

Based on the data, the company will be able to develop next-generation vaccines and boosters before the situation becomes as critical as what happened in 2020.

These efforts are essential for Moderna to sustain its position as the leader in mRNA technology.

Despite its earlier issues with production, Moderna is still set to generate roughly $19.2 billion in revenue for its COVID-19 vaccine thanks to advance purchase agreements.

The potential availability of a booster this year would definitely get the ball rolling in terms of handling newer variants.

The biotechnology industry is favored among investors on the lookout for companies with incredibly strong growth potential.

While it’s a risky environment filled with businesses flaming out practically year after year, winners in this field can come out with extremely impressive results.

In recent months, Moderna has become one of the most successful examples that demonstrated the potential of a biotech when it finds itself with cutting-edge technology at an ideal time.

moderna

May 4, 2021

Biotech Letter

Mad Hedge Biotech & Healthcare Letter
May 4, 2021
Fiat Lux

FEATURED TRADE:

(A BAD NEWS BUY STOCK)
(AZN), (PFE), (BNTX), (MRNA), (JNJ)

Tag Archive for: (MRNA)