Shares of the pharmaceutical company Moderna (NASDAQ:MRNA) declined over 11% yesterday. The drop came after the company disclosed that the efficacy of its respiratory syncytial virus (RSV) vaccine, mRESVIA, was much lower in comparison to its peers, Pfizer (PFE) and GSK (GSK).
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According to data presented to the Centers for Disease Control and Prevention’s (CDC) advisory committee, Moderna’s vaccine efficacy dropped from 55% in the first 12 months to 36% in the second year among patients with at least three RSV symptoms. This compared unfavorably to GSK’s Arexvy and Pfizer’s Abrysvo vaccines, which showed 74% and 59% efficacy rates against severe RSV, respectively.
It’s Not Just About Efficacy Rate
The lower efficacy compared to other vaccines available in the market may impact MRNA’s RSV vaccine sales outlook. However, this is not the only factor at play.
It’s worth noting that the data was presented to the CDC to recommend which age groups should receive RSV vaccines. Yesterday, the regulator authorized RSV shots for people over 75 years old. Additionally, adults aged 60 to 74, who are at high risk of serious illness from RSV, were also approved to receive the vaccine.
However, this recommendation is more limited than last year and excludes younger patients, as hoped by the companies. As a result, the insurance firms may not pay for the vaccine for those outside the recommended groups, affecting MRNA’s demand.
What Is the Future Price of MRNA Stock?
Wall Street is cautiously optimistic about Moderna’s prospects. It has a Moderate Buy consensus rating based on nine Buy, seven Hold, and two Sell recommendations. The analysts’ average price target on MRNA stock is $146.88, implying about 20% upside potential from current levels.
