August 12, 2021 Why is Moderna still so pricey? Lisa Urquhart New safety concerns in Europe over Moderna’s Covid-19 vaccine Spikevax and a respected pharma analyst calling the group’s valuation ridiculous might have knocked $29bn off the biotech’s market cap, but Moderna is still worth a staggering $155.5bn. Yesterday’s 16% pullback still leaves the company's shares at $385 each, up more than fivefold since the beginning of the year, something that the Bank of America analyst Geoff Meacham, with his $115 price target, believes is unjustifiable. A look at Moderna’s pipeline appears to confirm this; the combined NPV of its products is only $27.1bn, according to Evaluate Pharma. This is a far cry from Moderna’s valuation, which is higher than Amgen's or Bristol Myers Squibb’s, whose product NPVs are respectively $109.8bn and $187.5bn. While the true potential of mRNA might not have been tapped, most of Moderna’s pipeline remains early stage, and is in competitive areas like flu and RSV, or in tropical diseases. Additionally, current Covid-19 vaccine sales, the main driver of Moderna’s recent performance, are forecast to fall to just $2bn in 2026. The company is also unlikely to deliver a 100% pipeline success rate, leaving the question of why Moderna shares have not corrected further. Moderna products by NPV Today's NPV NPV as % of share Product Treatment area ($m) price Marketed Spikevax Covid-19 vaccine 20,199 13% Phase 2 mRNA- Cytomegalovirus vaccine 2,484 2% 1647 AZD8601 Myocardial ischaemia therapy 282 0% mRNA- Personalised cancer vaccine 97 0% 4157 Phase 1 mRNA- RSV vaccine 2,002 1% 1345 mRNA- OX40L/IL-23/IL-36y for solid 775 0% 2752 tumours/lymphoma mRNA- hMPV/PIV3 vaccine 529 0% 1653 mRNA- Propionic acidaemia therapy 276 0% 3927 mRNA- Zika vaccine 252 0% 1893 mRNA- Chikungunya anti-viral 5 0% 1944 mRNA- Kras vaccine 1 0% 5671 Preclinical mRNA- Phenylketonuria therapy 208 0% 3283 Total 27,110 18% Source: Evaluate Pharma. Top 10 biopharma companies by market cap Rank Company Market cap ($bn)* 1 Johnson & Johnson $457.5bn 2 Roche $345.6bn 3 Pfizer $259.2bn 4 Lilly $252.6bn 5 Novo Nordisk $230.9bn 6 Novartis $206.9bn 7 Merck & Co $190.4bn 8 Astrazeneca $175.4bn 9 Moderna $155.5bn 10 Bristol Myers Squibb $148.6bn Source: Yahoo Finance *as at August 11. More from Evaluate Vantage Evaluate HQ 44-(0)20-7377-0800 Evaluate Americas +1-617-573-9450 Evaluate APAC +81-(0)80-1164-4754 © Copyright 2021 Evaluate Ltd..