A personalized cancer vaccine developed by U.S. drugmaker Moderna succeeded in a Phase 3 trial, sending the company's shares up 177% in a single day. It was the largest daily gain by an S&P 500 company in more than two decades. The vaccine drew attention as a breakthrough that uses messenger RNA (mRNA) technology to target the cancer mutations that differ from patient to patient. Even so, skepticism is growing, with critics arguing that the vaccine has not been proven to work against all cancers and that further validation is needed.
Moderna shares were trading at $145.13 on the Nasdaq on the 24th local time, up 8.86% from the previous day. The stock, which had lingered in the $60 range, has risen for several days running since the announcement of the trial's success.
On the 19th, Moderna and its partner Merck announced successful results from a late-stage trial of intismeran autogene, a personalized mRNA-based melanoma vaccine. Patients who received the personalized vaccine along with Merck's Keytruda were significantly less likely to see their melanoma recur than those who received Keytruda alone.
The expectations reflected in the share price were high. Moderna's market capitalization rose from about $25 billion (34.6 trillion won) before the announcement to around $60 billion (83 trillion won) as of the weekend. Together with BioNTech and Merck, which are testing their own personalized mRNA cancer vaccines, the combined market value of the three companies grew by about $80 billion (111 trillion won) in a matter of days.
The outlook for annual sales, however, is calmer than the market's reaction. Daina Graybosch, an analyst at Leerink Partners, projected annual revenue from the treatment in the low single-digit billions of dollars by 2032. Even in an optimistic scenario peaking at $10 billion (14 trillion won) in annual sales, she put the combined market value of the two companies at around $40 billion (55 trillion won).
The reason for such measured assessments is that success has been confirmed only in melanoma, while the vaccine has not yet been proven to work against other cancers. The vaccine analyzes a patient's tumor to select up to 34 mutations as targets, but typically only two or three produce a meaningful immune response. Melanoma carries many mutations and responds relatively well to immunotherapy. By contrast, kidney cancer, the next target of clinical trials, has fewer mutations to target, while bladder cancer has a more suppressive tumor environment. Some cancers, such as pancreatic cancer, strongly resist immune-based treatments.
High production costs also weigh on pricing. Because a surgeon removes the tumor and sends it to a laboratory, where the mutations are decoded and an algorithm selects the targets, manufacturing costs are far higher than for conventional mass-produced drugs. The two companies have not disclosed a price, but based on comparable treatments, the total cost of treatment could be around $300,000.
Raising the price would run into resistance in Europe, where insurance negotiations are aggressive, while the Trump administration's policy of tying U.S. drug prices to those of other advanced economies would prevent charging American patients more. Graybosch projected that the initial gross margin on Moderna's cancer vaccine could stay between 50% and 80%, unlike conventional drugs, which can exceed 90%.
Luca Issi, an analyst at RBC Capital Markets, said, "The market is looking at this vaccine as the next drug in line after Keytruda or Opdivo, which have proven effective across multiple cancer types," while adding, "But it could turn out to be effective only in a much narrower range of tumors. The bigger potential of mRNA lies in preventive vaccines for high-risk cancers, but that stage is still far off."
