Could this be Moderna’s ticket to long-term success?


Modern (NASDAQ: ARNM) waited a long time to arrive at this important moment: the authorization of its vaccine for infants and children. Initially, the company aimed to win the regulatory green light for use in adolescents last year. But reports of heart inflammation in some young adults who had received the Moderna vaccine prompted the US Food and Drug Administration (FDA) to take longer to review the company’s submission.

This month, the FDA cleared the vaccine for adolescents and children aged six months and older, and the vaccine rollout has begun for the youngest group. Could this new permission be Moderna’s ticket to long-term success? Let’s find out.

A Pfizer authorization

Importantly, regulators have also cleared competitors Pfizerit is (NYSE: PFE) vaccine for use in children six months to 4 years old this month. Last year, the FDA cleared Pfizer’s vaccine for use in older children. Moderna is therefore not the only player in this market.

We will first look at the short term. Moderna is unlikely to gain much market share in the older children’s group, as parents who wanted to have their children vaccinated have probably already done so. And when a callback is eventually needed, they can opt for Pfizer if they’ve had a good experience with the primary series.

The two companies are perhaps almost on equal footing when it comes to young children, as they enter the market at the same time. In fact, Moderna may even have a slight advantage: its vaccine is given in two doses to all age groups. Pfizer’s vaccine is given in three doses for the youngest age group. This three-dose vaccine produces stronger efficacy in this group – 80%, compared to 37% (children aged 2 to 5 years) to 51% (infants and toddlers aged six months to 2 years) for the vaccine of Moderna. But parents may not want to go through Pfizer’s longer process; her three injections are given over an 11-week period. This is compared to a one-month period for the main Moderna series, which could present Moderna with the opportunity to gain market share.

It’s positive. But I don’t see the vaccine for those age groups offering a big boost in short-term income. It is true that some parents have been very eager to have their babies and young children vaccinated, but they may not be the majority. According to a survey by the Kaiser Family Foundation, only 1 in 5 parents planned to have their children in this age group vaccinated immediately after authorization.

And, in general, children have not been among the most vulnerable to the coronavirus. So even some health professionals may not push parents to have their children vaccinated.

The long-term picture

I’m more optimistic about the long term, though. Experts predict that SARS-CoV-2 is here to stay. Over time, the coronavirus vaccine may join the list of others that people seek out seasonally — or that most children choose as part of early childhood vaccinations. Even parents who are not rushing to get their children vaccinated today may eventually opt for the vaccine in this setting.

Still, I don’t think childhood vaccines will make up the biggest chunk of Moderna’s revenue. High-risk people are likely to be the main clients of the vaccine over time, although children may form part of the long-term income picture. And as children continue to be born and enter school, this population could provide a steady stream of demand. No, childhood vaccinations will not be the ticket to Moderna’s long-term success. But, over time, this market could be one of many tickets.

10 stocks we like better than Moderna Inc.
When our award-winning team of analysts have stock advice, it can pay to listen. After all, the newsletter they’ve been putting out for over a decade, Motley Fool Equity Advisortripled the market.*

They just revealed what they think are the ten best stocks investors can buy right now…and Moderna Inc. wasn’t one of them! That’s right – they think these 10 stocks are even better buys.

View all 10 stocks

* Portfolio Advisor Returns as of June 2, 2022

Adria Cimino has no position in the stocks mentioned. The Motley Fool recommends Moderna. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


Comments are closed.