Moderna’s COVID-19 trial delayed: should investors be concerned?


Modern (NASDAQ: MRNA) It was one of the first companies to launch a Phase 1 clinical trial for its investigational COVID-19 vaccine, mRNA-1273. The trial in question, led by the National Institutes of Health (NIH), began in mid-March and enrolled 45 healthy adult volunteers. The trial tested the vaccine’s safety, immunogenicity (ability to cause immune system response) and reactogenicity (possible side effects). After obtaining the green light from the United States Food and Drug Administration (FDA), Moderna began a phase 2 test for mRNA-1273 in May. This trial will evaluate the safety, immunogenicity and reactogenicity of the vaccine in a group of 600 healthy participants.

On June 11, the biotech company announced that it had finalized the protocol for its phase 3 clinical trial for mRNA-1273. Moderna plans to enroll 30,000 participants for this trial, whose primary goal will be “prevention of symptomatic COVID-19 disease.” Although Moderna hoped to start this study late this month, the start of this trial has been delayed, according to a report by STAT, a health industry news website.

Moderna’s shares have soared nearly 200% to date, mainly due to its efforts to develop a vaccine for COVID-19. But what should investors do with this latest development?

MRNA data by YCharts

The panorama

First, it is essential to recognize the breakneck pace at which Moderna has been moving through the early stages of developing its potential COVID-19 vaccine. Under almost any other circumstance, it has likely taken the biotech company years to get to this point. Development of a new vaccine generally takes 10-15 years, according to the International Federation of Pharmaceutical Manufacturers and Associations (IFPMA).

According to the report, Moderna also plans to start this clinical trial in July, although, at this time, there is no guarantee that the company will. One more point worth mentioning is that a change in protocol was what supposedly caused the delay, which, as stated by an unidentified investigator familiar with the matter, is a common occurrence in clinical trials. In other words, there is nothing abnormal about this delay, at least as far as we know.

Woman standing in front of a board with dozens of question marks drawn on the board.

Image source: Getty Images.

That said, however, the race to launch a COVID-19 vaccine on the market is heating up. For example, AstraZeneca , which is developing its investigational COVID-19 vaccine in collaboration with the University of Oxford, began enrolling participants for a phase 2/3 clinical trial in late May. AstraZeneca is considered to be one of the leaders in this race, and the company was also one of the original five selected by the United States government to join the Operation Warp Speed ​​program. This initiative seeks to accelerate the development of a vaccine for COVID-19.Novavax it is also currently running a phase 1/2 clinical trial for its investigational COVID-19 vaccine, NVX-CoV2373; The company expects to release some data from this test this month.

Of course, Moderna remains one of the undisputed leaders in this race, even with the start of its phase 3 clinical study delayed, however, since Moderna’s gains in the market this year have been fully driven by its drive. To launch a vaccine for COVID-19 on the market, preferably before any of its peers does, it is not surprising that investors were not thrilled that the company hit a hurdle.

What should investors think?

Depending on how long the start of her phase 3 clinical trial is delayed, this episode may become a minor complication for Moderna. If the company still manages to start its study at a late stage sometime in July, or even August, it will still be ahead of the vast majority of its competitors in this race. Additionally, Moderna CEO Stephane Bancel said earlier this year that no single company can produce enough COVID-19 vaccines to meet the global need. This opens the door for multiple companies to have their vaccines approved by regulatory authorities. Moderna remains well positioned to be one of the first to cross the finish line.

In summary, those who think that Moderna presents attractive prospects should not take much advantage of this delay. However, the results of clinical trials will be the most critical factors in the search for a COVID-19 vaccine. If the possible Moderna vaccine does not prove to be effective in a future clinical trial, its stock will plummet, especially given that the company has no other products on the market and no candidates for the final phase of testing. This makes Moderna a risky biotech stock to invest in. But for investors willing to take the risk, the payoff might be worth it.