Covid Vaccine Battle Brewing: Moderna's Stephane Bancel Vs. Bernie Sanders
Moderna's CEO, Stephane Bancel, will face a Senate Committee today over the company's pricing plans.
(MRNA). On Wednesday, Stephane Bancel, Chief Executive, will be facing off against Senator Bernie Sanders, I-Vt. over plans to quadruple Covid shot's price. Moderna stock could be rocked by the battle.
Moderna, a vaccine manufacturer, announced this week that it will begin charging $130 for each dose of Spikevax Covid vaccine in the U.S. after the May public health emergency. The U.S. government has so far paid the cost of Covid vaccines. However, that will change once the shot hits commercial markets.
Bancel will now have to explain what the company thinks before the Senate's Health, Education, Labor and Pensions Committee. That committee is headed by Sanders, who in January took Moderna to task by claiming that the U.S. government had given the company $1.7 billion to develop the vaccine.
He also pointed out that the proposed price is four times more expensive than the $27 Spikevax cost per dose in the United States in 2022.
Moderna stock rose just 0.3% in morning trading today's stock exchange.
Moderna Stock: Negotiations ongoing
According to Reuters, Stephen Hoge, President of Moderna, says that multiple customers are negotiating for different prices.
He pointed out that the Centers for Medicare & Medicaid Services (CMS) pay $70 for the seasonal flu shot, and that there have been two to three times as many hospitalizations due to Covid over the past three months than the flu. He said that this was part of the company’s pricing logic.
Hoge also claimed that Moderna has more to pay back federal funding than it received by selling its vaccine at lower prices than Pfizer. Moderna increased its manufacturing.
MarketSmith.com reports that Moderna stock currently sits just below its 200 day moving average.
Pfizer also plans price hike
Moderna's pricing strategy aligns with the $110-$130 per share price Pfizer announced last year for its BioNTech(BNTX),-partnered Covid vaccine. Pfizer will start charging this new price once the U.S. has exhausted its government-acquired vaccinations.
Angela Lukin (Pfizer's U.S. president and global primary care) stated that the price range "really does represent highly cost-effective modelling." Pfizer did not receive any government funding for the development of its Covid vaccine, Comirnaty.
Comirnaty made more than $37.8billion in sales last year. Sales are expected to drop to $13.3 billion this year. Moderna stock analysts predict Spikevax sales will fall to $6.9 Billion, down from $18.4 Billion last year. Comirnaty, however, is only one of Pfizer’s products. This is a crucial difference between the two companies. Spikevax, Moderna's sole commercial drug, is at the moment.