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Moderna stock gets boost from earnings beat, COVID-19 vaccine sales

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Yahoo Finance’s Anjalee Khemlani joins the Live show to discuss second-quarter earnings for Moderna, the Biden administration’s fall booster campaign, COVID-19 vaccine sales, and longer-term vaccine growth.

Video Transcript

BRIAN SOZZI: Moderna is out with its latest earnings. And the stock is getting some play on the Yahoo Finance platform after the company topped estimates in its latest quarter. Revenue getting a boost primarily due to increased product sales from Moderna's COVID-19 vaccine. Yahoo Finance's senior healthcare reporter Anjalee Khemlani joins us now. And Anjalee, I understand you caught up with Moderna's CEO, Stephane Bancel.

ANJALEE KHEMLANI: That's correct. And to your point about the increased sales, I mean, the COVID vaccines continued to be a really strong product for the company. But they are looking at the future and what that means, whether it's just the boosters for the COVID vaccines or even beyond that to flu and the global market.

Now, we do know that boosters are, of course, a big topic here in the US, especially looking at that fall booster campaign that the Biden administration is targeting. The FDA did ask the company for an updated booster shot, variant specific, and including a two-strain, specifically the original strain and the BA.4, BA.5 strain. And that is set to hit the markets, according to the Biden administration, by September. But we did hear an earlier estimate that the company wouldn't be able to meet the deadline until October. So when I asked CEO Stephane Bancel about that, here's what he had to say.

STEPHANE BANCEL: We're working very closely with the US government. We're working really hard to get these to early fall. And we're already making the BA.4, 5 vaccine, as we speak, in our Massachusetts plant. And so we'll give an update as we get closer to it, but we know how important it is. And we know that every day matters.

ANJALEE KHEMLANI: So as you can hear, really a strain for the company right now. And they're not the only one. It seemed like they were ready to roll out that Omicron specific vaccine earlier, which they're being asked to do in Europe. Europe has asked for an entirely different booster shot. So they're sort of doing parallel tracks right now.

Meanwhile, we know, of course, looking to the global market, they're seeing a reduction in demand there, accounting for doses sitting on the shelves getting expired. They took a $500 million hit there. There's some unused manufacturing capacity as well.

But all in all, they seem to be really bullish about the fourth quarter and increased sales and advance purchase agreements there. Meanwhile, also looking at the potential for a commercial market, which is outside of governments and public health authorities purchasing those doses for the coming year.

BRAD SMITH: It seems like there's a lot of focus as well here on the share repurchase program that they also announced, their new $3 billion share repurchase plan. And so going forward from here, it really does beg this question of, for the confidence that they're putting out there into the Street, where are some of the key parts of the business where they're going to be banking a lot of that growth on going forward, too.

ANJALEE KHEMLANI: Well, and also remember, this is not the first quarter that they've announced the repurchase, right? So they are sitting on a good chunk of cash, and they're looking at beyond the COVID vaccine. They're looking at flu, a combination of flu and COVID. And they are looking at some other diseases as well. They have started to look at monkeypox as well. So they're looking at how to really leverage this fast platform that they've been bragging about, right, this mRNA platform, into responding to new and upcoming viruses, as well as markets that they know.

We've also heard them talk about opening up plants in Africa, for example, right, in Kenya, and targeting that LMIC market that has largely been ignored for some time. But in my discussion with the CEO today, he did mention it in talking about how this is really a long-term play. And they really see some longer term growth when it comes to their potential pipeline, which has, what, 40 some odd products in it right now.

JULIE HYMAN: Yeah, I mean, that was always the promise, right, of this platform. Once you figure out the platform works, you can apply it to all those different things you mentioned. But what's the timeline for something like that? I mean, if the idea is that they can come up with vaccines quickly, like-- and they're looking at monkeypox, like, shouldn't it-- I mean--

ANJALEE KHEMLANI: Shouldn't it be going right out?

JULIE HYMAN: Yeah.

ANJALEE KHEMLANI: I'm so glad you asked that because I did ask this question. And they are basically waiting for conversations with the FDA to come through. Right now, they're in discussion, trying to figure out whether or not there is a market for monkeypox.

They still have confidence in their ability to scale and to be able to respond to it, but they're still sitting and waiting in preclinical stage, not moving forward, because they still have to get, essentially, a guarantee that they're going-- the product is going to be needed if they're going to be investing in it, is the bottom line. So that is sort of where we're sort of waiting and watching. And they'll have an update as soon as they know.

BRAD SMITH: I mean, I'm sorry for my eyes being wide open because it's as, what, two or three states now have entered into a state of emergency for monkeypox.

ANJALEE KHEMLANI: Well, and they've said the reason why is there's already a vaccine. We know that that vaccine is facing problems, shortages galore, manufacturing issues. And the idea that this is not the same kind of pandemic that COVID was is playing a huge role in the sentiment on whether or not to move ahead.

BRAD SMITH: Very good to know. Great insight, as always. Yahoo Finance's own Anjalee Khemlani.