Moderna's Stock Price Surges Over 10% on Promising Cancer Vaccine Trial and Potential $3 Billion Opportunity

Moderna (NASDAQ: MRNA) is witnessing a significant surge in its stock price on Monday, with shares soaring more than 10% and surpassing the $114 per share milestone. This upswing has propelled MRNA to its highest level since January, marking a notable rebound after a lackluster performance in 2023.

So, what's behind Moderna's stock rally?

According to information from a government trial website, the biotech firm is commencing a mid-stage clinical trial to evaluate its experimental cancer vaccine in patients diagnosed with cutaneous squamous cell carcinoma, a type of skin cancer. This trial is being conducted in collaboration with Merck, a pharmaceutical giant.

Additionally, analysts at UBS released a note to clients on Monday, highlighting Moderna's latent virus platform during a fireside chat. They emphasized the potential significance of the Phase 3 cytomegalovirus (CMV) data expected later this year, which they view as an underrated catalyst for Moderna's shares and a substantial opportunity estimated at over $3 billion for the company.

"We believe Moderna's platform and broader pipeline are undervalued, and we are particularly focused on the potential impact of Phase 3 CMV data, which could serve as a significant upside driver for the stock," stated UBS analysts.

Meanwhile, Jefferies, maintaining a Buy rating and $115 price target on Moderna, pointed out that Merck has initiated a new Phase 3 study involving Moderna's cancer vaccine V940. This marks the third Phase 3 trial for Merck, indicating continued confidence and substantial investment in the program.

Recent Updates from Moderna:

In its fourth-quarter earnings report, Moderna acknowledged 2023 as a transitional year as it adjusted to the evolving market dynamics. Despite the challenges, the company highlighted significant progress across various therapeutic areas, including infectious diseases, oncology, and rare diseases. Moreover, Moderna noted a rise in its market share in the U.S. for COVID-19-related products.

Looking ahead, Moderna anticipates the initial regulatory approvals of its respiratory syncytial virus (RSV) vaccine (mRNA-1345) to commence in the first half of 2024. The company also expects research and development expenses for the full year 2024 to be approximately $4.5 billion.

Furthermore, Moderna provided a comprehensive pipeline update earlier this year, revealing that it entered 2024 with 45 therapeutic and vaccine programs, with nine in late-stage development. The company foresees profitability for its COVID-19 franchise in 2024 and beyond, projecting approximately $4 billion in product sales for 2024, primarily driven by COVID-19 vaccine sales and the launch of its RSV vaccine.

In January, Moderna announced the full enrollment of the Phase 3 trial for its combination vaccine targeting seasonal flu and COVID-19, with data expected later in 2024. This development underscores Moderna's commitment to advancing innovative solutions to address pressing public health challenges.