Moderna (MRNA) Announces Pipeline Progress, Shares Rise

Moderna, Inc. (NASDAQ:MRNA) announced positive updates on its pipeline of immuno-oncology and rare-disease candidates at the Annual J.P. Morgan Healthcare Conference in San Francisco. The company’s pipeline consists of only messenger RNA (mRNA) therapeutics candidates in early stages of development.

Following the update, shares of Moderna were up 4.2% on Jan 8. However, its shares have declined 8.9% since its initial public offering (“IPO”) compared with the industry’s decline of 1.4% in that period.

The company has 21 mRNA investigational candidates with 11 candidates in clinical development stage.

The company completed raised around $600 million in its IPO and started trading publicly since Dec 7, 2018.

Immuno-oncology Pipeline Update

The company’s key immuno-oncology candidates include OX40L (mRNA-2416) and a triplet – OX40L + IL23 + IL36γ (mRNA-2752) – which are directly injected into tumors to drive anti-cancer T cell responses.

Based on data from a phase I study, which evaluated mRNA-2416 in advanced ovarian carcinoma, the company has submitted an investigational new drug (“IND”) application with the FDA to initiate a phase II study. The phase I study is also evaluating the candidate in patients with advanced relapsed/refractory solid tumor malignancies and lymphomas.

The triple combination candidate, mRNA-2752, is being evaluated, as a single agent or in combination with AstraZeneca’s (NYSE:AZN) Imfinzi (durvalumab) or tremelimumab, in a phase I study in patients with advanced or metastatic solid tumor malignancies or lymphoma.

Cancer Vaccines

Moderna has two vaccine candidates in clinical development – personalized cancer vaccine (mRNA-4157) and KRAS vaccine (mRNA-5671). A dose escalation phase I study is currently evaluating mRNA-4157 for antigen-specific T cell responses, while Moderna and its partner Merck (NYSE:MRK) are planning to initiate a phase II study to investigate a combination of mRNA-4157 and Keytruda.

Moderna had submitted an IND for the KRAS vaccine candidate but has transferred the rights to Merck. Merck will lead the dose-escalation and dose-expansion Phase I study, which will evaluate the safety and tolerability of mRNA-5671 both as a monotherapy and in combination with Keytruda in epithelial cancers.

Rare Disease Pipeline Update

Two candidates – mRNA-3704 and mRNA-3927 – are in pre-clinical stage of development. However, Moderna has submitted IND for mRNA-3704 to initiate a phase I study on patients with methylmalonic academia, an inherited disorder in which the body is unable to process certain proteins and fats (lipids) properly. mRNA-3927 is being studied for propionic acidemia, another rare metabolic disorder. Both the candidates enjoy Orphan Drug status and have been granted Rare Pediatric Disease designation.

With several candidates in its pipeline, the company’s operating expense is high. Although the company has a strong balance sheet, no marketed drug and early stage of pipeline development is likely to put pressure on it. However, collaboration with other pharma companies including AstraZeneca, Merck, Vertex Pharmaceuticals (NASDAQ:VRTX) and Alexion Pharma will generate revenues.

Zacks Rank

Moderna currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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