To The Moon

$Moderna, Inc.(MRNA)$   is down 94% from ATH and is trading near cash!

In this thread I'll tell you what's going on and why I own the stock.

Over the past year, shares of Moderna, the American biotech company founded in 2010 to develop mRNA-based vaccines and therapies, have been in steady decline. While a series of negative events has occurred, there are nonetheless a few potential catalysts worth considering.

The stock has lost approximately 94% of its value from the highs reached during the pandemic.

Yet, the company has built a pipeline of 45 candidates, including 8 assets in Phase 3 and many more in Phase 2, investing over 20 billion dollars in research and development.

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Today’s market cap of $11 billion reflects a deep lack of confidence in the company’s ability to generate future revenue, even though it still holds 8 billion in cash and likely recurring COVID vaccine revenues of around 2 billion.

THE MARKET FEARS ARE WELL-FOUNDED Market fears are numerous as a series of negative events have accumulated, here are some examples:

Specifically regarding the company, Moderna has missed its targets in many quarterly reports due to declining COVID vaccination rates and loss of market share to competitors (BioNTech/Pfizer, Novavax/Sanofi).

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The appointment of RFK Jr. to the Department of Health and Human Services was a cold shower. 8The politician is mostly known for his conspiracy theories and anti-scientific views, particularly against vaccines, so you can imagine the market’s reactions.

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On Wednesday, June 11, new members were appointed to the ACIP, a committee responsible for vaccine recommendations in the US. Kennedy fired all previous committee members, a questionable decision, and once again, some controversial figures were included among the members.

First and foremost, Robert Malone, who shares Kennedy’s anti-scientific views, also takes advantage of the general public’s limited scientific knowledge to recommend alternative treatments like Ivermectin, whose efficacy has never been proven.

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THE POSITIVE SIDE OF THE COIN Despite the political headwinds, Moderna’s CEO Stéphane Bancel remains confident about the company’s future. During the recent discussion at the Goldman Sachs Healthcare Conference, several potential positive catalysts were highlighted:

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The COVID vaccine market could stabilize, partly due to new FDA recommendations that apply to 100 million Americans. In 2024 only 40 million people got vaccinated, which leaves room for a possible increase in vaccination rates.

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Moderna’s market share could improve in 2026/2027, by the end of this year new manufacturing facilities will open in Canada, the UK, and Australia, allowing local production. In addition, a supply agreement between the EU and Pfizer/BioNTech will expire in 2027.

Looking at the numbers, the US market could be worth $1.5B for Moderna, and international markets another $1B, it’s plausible to expect revenues to stabilize between $2 and $3 billion. Moderna can also leverage its next-generation COVID vaccine, mNEXSPIKE.

Regarding other upcoming launches, assuming positive Phase 3 readouts, Moderna remains confident: Flu: Phase 3 data validating the efficacy of the flu vaccine, also relevant for the COVID/flu combo, is expected soon.

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CMV: Phase 3 results are expected in the coming months, although the interim analysis did not show positive signals. Norovirus: Phase 3 could be completed this year or next. INT: The cancer vaccine program is advancing, with Phase 3 data in melanoma expected in 2026.

As you can see, the list of catalysts is extensive, and at the same time, the company has proven quick to cut unnecessary costs. According to Moderna, the $8 billion in cash on hand is sufficient to reach profitability by 2028.

MY $MRNA POSITION IS DOWN MORE THAN 40%. HOW AM I HANDLING IT? You can read all my reasoning in the article on Substack (link at the end) but I want to add two things to conclude.

I will certainly maintain my position. I’ll also consider increasing it because I remain highly confident in this contrarian idea, even though my allocation to MRNA has fallen to 4.5% due to the price movement and several other investments that have performed well.

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Lastly, I want to make it clear that the simple fact the price has dropped does not mean the thesis is wrong, time horizon matters, and mine is definitely not just a few months.

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