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Moderna CEO makes case for firm’s lofty valuation

mRNA specialist has to convince investors after stocks slide

Moderna CEO Stéphane Bancel took the stage at the JP Morgan Healthcare conference yesterday to give an update on the firm’s bold R&D plans – and to reassure investors spooked by recent share price declines.

Moderna’s record-breaking $604m IPO last year was followed by a steep decline in its shares, which contributed to the anxiety about biotech sector financing overall in 2019, although Bancel made a case at JPM2019 that his company fully justifies its multibillion-dollar valuation.

Moderna’s specialty is in messenger RNA (mRNA) drugs which are designed to turn a patient’s own cells into drug-manufacturing factories, hijacking the cellular machinery involved in protein production. It’s potentially a whole new drug class, and a different spin on other RNA approaches, such as RNA interference, that aim to switch off protein synthesis.

Stephane Bancel

Moderna's CEO Stéphane Bancel

From its inception eight years ago, it now has 21 development programmes spanning prophylactic vaccines, cancer vaccines, immuno-oncology, and others, with 11 already in trials. The first candidates to be tested were all in the vaccine category, an artefact of the company’s earlier concerns with repeat dosing of mRNA compounds causing immune reactions as they don’t need to be delivered chronically.

Vaccines for diseases such as flu are unlikely to turn into big sellers – although Bancel reckons its candidate for cytomegalovirus (CMV) is pitching at a “several billion dollar” market. For many analysts however, the results of Moderna’s personalised cancer vaccines, cancer immunotherapies and systemic therapeutics will be the best as a yardstick for mRNA’s potential as a new therapeutic class.

Three additional candidates are due to reach the phase 2 testing stage this year, joining Moderna’s AstraZeneca-partnered VEGF-A candidate for heart failure which is its lead project.

The biotech announced this week It has filed for FDA approval to start a phase 2 trial of OX40L- targeting immuno-oncology drug mRNA-2416 in ovarian cancer, with mid-stage studies of candidates for respiratory syncytial virus (RSV) and a personalised cancer vaccine partnered with Merck & Co/MSD also at the planning stage.

2019 will also see the company’s first studies in rare genetic diseases, with an application to start US trials of a drug for methylmalonic acidaemia (MMA) called mRNA-3704 filed at the end of 2018, and another for propionic acidaemia (PA) filed earlier this month. Other new studies coming up are phase 1 assessments of a triplet immuno-oncology drug (targeting OX40L, IL23 and IL36γ) and a Merck-partnered KRAS vaccine.

Bancel told the conference that from the data generated from its programmes to date there are three clear readouts – the mRNAs are all well-tolerated, express the designed protein, and those proteins are active in humans.

“We think this is a very good start,” he said. And with 14 trial readouts in the next 12 to 18 months, there will be plenty of opportunity to gauge Moderna’s progress towards establishing mRNA as a new drug class.

Investors seemed to be reassured, with shares in the company rising 4% in the wake of the presentation.

Article by
Phil Taylor

9th January 2019

From: Research

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