modern (MRNA) Friday up for possible follow-up Pfizer(PFE) in the footsteps of raising the price of its Covid vaccine in 2023. MRNA stock rose on the news.
Pfizer plans to roughly quadruple the price of its Covid vaccine to $110 to $130 per dose for recipients 12 and older. In an email to Investor’s Business Daily, Pfizer said the transition to the commercial market could take place as early as the first quarter of 2023.Today, the U.S. government pays about $30 per dose Biological Technology (BNTX) – Collaborative shoot.
SVB Securities analyst Mani Foroohar expects Moderna to follow Pfizer’s lead.
“Assuming Moderna is priced as a rational duopoly, this significantly improves the company’s ability to meet its 2023 revenue guidance,” Foroohar said in a note.
In midday trading on the stock market today, MRNA shares were up 9.3% near 129.30. Pfizer shares also surged 4.2% near 44.70. BioNTech shares surged 10% near 130.20. Novax (NVAX), which recently received authorization for a Covid vaccine and first booster in the US, surged 8.8% to around 18.70.
MRNA stock: Covid shot demand drops
Higher prices will help bridge the slowdown in demand for Covid vaccines and expectations for 2023. Analysts polled by FactSet expected Pfizer’s revenue of $16.4 billion and Moderna’s revenue of $8.4 billion. Compared to 2022, these forecast requirements represent a sharp drop of 49% and 60%, respectively.
Foroohar of SVB Securities raised his price target on MRNA stock to 101 from 74. He also upgraded the stock to market perform from underperform. Still, he’s not entirely convinced of Moderna’s latest flu vaccine and Merck’s collaboration on personalized cancer vaccines.
“We are taking a wait-and-see approach, waiting for a more attractive entry point for the bulls or bears,” he said.
A Moderna representative could not immediately comment on the company’s pricing plans.
New challenges in the commercial market
Pfizer’s latest pricing comes as the U.S. health emergency ends. The company expects most commercially insured patients will continue to pay anything for a Covid vaccine. Pfizer also said it plans to provide free vaccines to eligible uninsured patients through an assistance program.
Pfizer noted that the transition to the commercial market includes the challenge of distributing the vaccine through multiple channels and payers, rather than strictly through the government. This is also expected to challenge mRNA stocks.
The company also wants its customers to request more single-dose vials. This will limit the number of vaccines that have expired and not been used. However, single-dose vials are three times more expensive to manufacture and ship than multi-dose vials.
Still, despite the gains in Moderna and Pfizer, both stocks are under pressure. MRNA stock reached its most recent peak in August, but has since fallen. Pfizer’s stock has been on a downward trend since July.
Follow Allison Gatlin on Twitter @IBD_AGatlin.
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