On Sunday, Moderna (MRNA) disclosed it had been awarded an extra $472 million from the Biomedical Advanced Research and Development Authority (BARDA) to further support the development of mRNA-1273, its experimental COVID-19 vaccine. The new award follows a $483 million grant provided by BARDA in April, which means Moderna has now received a total of $955 million in funding from the U.S. government.
The award coincides with the initiation of Moderna’s Phase 3 study of mRNA-1273. The study began on Monday with the dosing of the first patients in the 30,000-participant study across 87 trial sites. If all goes according to plan, efficacy data for the study could become available as soon as Thanksgiving.
After gaining 298% since the turn of the year, Moderna shares experienced a rare setback last week following a ruling by the US Patent and Trademark Office (USPTO), which rejected Moderna’s claim that Arbutus Biopharma’s US patent on lipid nanoparticle (LNP) formulations should be revoked.
However, Chardan analyst Geulah Livshits argues the verdict will have little impact on Moderna’s COVID-19 vaccine program.
The 5-star analyst commented, “We would not anticipate IP negotiations to delay mRNA-1273 commercialization given the obviously important public health impact of a SARS-CoV-2 vaccine and the high degree of motivation among government agencies to roll out a vaccine as soon as possible. Moreover, we believe awards supporting development of mRNA-1273 and broader manufacturing scale-up reduce COGS across the platform and to us suggest Moderna's pipeline can become profitable even if royalty payments come into play in the future.”
To this end, Livshits rates MRNA a Buy along with a $95 price target, which implies nearly 20% upside from current levels. (To watch Livshits’ track record, click here)
When it comes to Moderna, Livshits’ colleagues hardly deviate from the Chardan playbook. MRNA's Strong Buy consensus rating is based on 13 Buy ratings and 4 Holds. The Street thinks a 17% premium will be added to MRNA shares over the next 12 months, going by the $90.67 average price target
