What happened
Actions of Modern (NASDAQ: MRNA) moving 4.5% down from 11:57 am EST on Monday. The decline appears to be a direct result of the US Food and Drug Administration (FDA), which has granted emergency use authorization (USA) for Johnson & Johnsonin (NYSE: JNJ) COVID-19 vaccine over the weekend.
And
Does Johnson & Johnson’s USA make a difference to Moderna in the short term? No. Moderna already has an agreement with the United States government to supply 300 million doses of its COVID-19 vaccine. With the supply agreements the US government has made with other companies, there will be more than enough doses of vaccine to immunize all American adults this year.
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The most important question is whether or not J&J’s COVID-19 vaccine could take Moderna’s market share in the long run. While Moderna’s mRNA-1273 requires two doses, the J&J vaccine requires only a single dose. However, Moderna’s overall effectiveness appears to be significantly greater – although it is impossible to make a true comparison because of the emergence of new variants of the coronavirus that were a major factor in the J&J final stage study.
The new variants are likely to be a key factor in Moderna’s ability to retain its market share. Biotechnology’s messenger RNA (mRNA) technology can give you an advantage in the rapid development of booster shots that are effective against new strains of coronavirus that may arise in the future.
What now
Moderna may have more good news on the way. For example, the company should report the short-term results of a phase 2/3 study evaluating mRNA-1273 in adolescents. It is also strengthening its pipeline and will soon be advancing mRNA-1647 from the cytomegalovirus (CMV) vaccine in a fundamental end-stage study. Don’t be surprised if biotechnology stocks recover relatively quickly.
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