BioNTech (NASDAQ: BNTX) recently received a public break-up message from his favorite collaborating partner that reverberated with Modern (NASDAQ: MRNA) and all other biotechnologies with similar technology. Pfizer (NYSE: PFE) decided that it can make vaccines based on messenger RNA (mRNA) for other diseases without the help of BioNTech or anyone else.
While bragging about Wall Street Newspaper Of all the lessons learned during the company’s first experience working with BioNTech, Pfizer CEO Albert Bourla said: “We have developed our own experience.” That is why these six words can mean problems for BioNTech, Moderna and a series of biotechnology start-ups that develop similar drugs.
Image source: Getty Images.
The limitations
Using mRNA strips to turn human cells into vaccine mini-factories seems like a great way to protect against viruses, but this technology still has many limitations. Until someone makes a breakthrough, mRNA-based drugs will remain limited to single-use applications. This is because viruses have been using RNA to hijack cellular machinery since early life, and our immune systems still go crazy when they find mRNA strands that should be therapeutic.
Outside the vaccine arena, there aren’t many applications that mRNA can safely treat, and there are so many scary pathogens that people need protection from. This means that Pfizer will end up clashing with almost all companies that depend on mRNA technology.
Moderna’s pipeline relies entirely on mRNA, so you will almost certainly find Pfizer’s mRNA platform. The BioNTech pipeline is strongly focused on drugs based on mRNA, but not entirely. The company has two antibodies and a small molecule drug in early-stage clinical trials as potential new treatments for cancer.
A fearsome competitor
Since the FDA has already started to slow down in a pandemic way, it is unlikely that we will see Pfizer transport another vaccine candidate from the concept to commercialization in less than a year. That said, we can probably count on Pfizer surpassing its less established peers such as Moderna and BioNTech.
Pfizer is ready to support the development of mRNA vaccines with the same enthusiasm that it applied to the COVID-19 vaccine race. To get an occasional boost, Bourla said the company would start making some experimental products at risk before they had a chance to get approval.
Races until approval are not the only challenge that Pfizer can launch in front of Moderna and BioNTech. Before the new coronavirus showed its ugly face, Pfizer was already a champion in the vaccine market. The company’s vaccination to prevent pneumonia for older adults, Prevnar-13, was the world’s best-selling vaccine in 2019, with $ 5.8 billion in sales worldwide.
Collaboration is everything
Pfizer’s decision to work on new mRNA-based vaccines is bad news for almost all companies with a focus on clinical stage mRNA. If other large pharmaceutical companies follow Pfizer’s example and develop mRNA-based drugs internally, clinical stage biotechnology companies that rely on this technology will have serious problems.
It is impossible to overstate the role that collaboration plays in today’s biopharmaceutical industry. Since each step along the drug development path is exponentially more expensive than the previous step, clinical stage companies need partners with a lot of money to accept some financial risks and give an experienced hand.
If independent biotechnology companies are able to overcome all the obstacles necessary to obtain approval for a new drug, they will still need to hire a sales team to face the challenge of the commercial stage.
They will survive
Pfizer’s entry into the mRNA arena is not a reason to divest its shares of BioNTech or Moderna, but you will want to keep an eye on the progress of the big pharmaceutical industry.
Although Pfizer’s entry into the mRNA arena is disastrous news for companies in the clinical stage that develop mRNA-based drugs, BioNTech and Moderna will have a good chance of expanding their horizons. In 2021, Pfizer expects revenue from the COVID-19 vaccine to reach about $ 15 billion based on existing contracts. BioNTech is entitled to half the profits that the vaccine generates.
This year, Moderna expects $ 18.4 billion in sales of COVID-19 vaccines. The amount that the company’s financial results are expected to achieve this year is unclear, but it will be enough to move forward with a new potential cytomegalovirus (CMV) vaccine currently in clinical trials in the final stage.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are heterogeneous! Questioning an investment thesis – even our own – helps all of us to think critically about investing and making decisions that help us become smarter, happier and wealthier.