Learn To Invest
Stocks Special Reports LICs Credit Funds ETFs Tools SMSFs
Video Archive Article Archive
News Stocks Special Reports Funds ETFs Features SMSFs Learn


COVID-19 vaccine booster plans match our expectations

Damien Conover  |  24 Sep 2021Text size  Decrease  Increase  |  
Email to Friend

The Biden administration has released plans for a third mRNA vaccine booster dose—from either Pfizer (PFE)/BioNTech (BNTX) or Moderna (MRNA)—starting in late September. The timeline is largely in line with our expectations, and we don’t expect any changes to our fair value estimates or moat ratings for the mRNA manufacturers.

At current stock prices, we view Pfizer, BioNTech, and Moderna as overvalued, with the market likely overly optimistic about the long-term demand for mRNA vaccines. Pfizer, BioNTech and Moderna last closed at 5%, 97% and 177% premiums to fair value, respectively.

A booster shot is likely to help with antibody levels and secure strong vaccine sales at Pfizer/BioNTech and Moderna through 2022. But in the long run, we expect more limited utilization (focused on higher-risk individuals), competition from new vaccine manufacturers (Sanofi, Glaxo, and others), and the eventual waning of the coronavirus to limit the long-term potential of the mRNA COVID-19 vaccine franchises.

While the initial series of mRNA vaccines continues to show 90%-plus efficacy in preventing severe disease, efficacy against symptomatic infection has been slowly declining. Both Pfizer/BioNTech and Moderna have early phase 2 data showing that a third dose of their authorized vaccines significantly boosts neutralizing antibody activity against the original strain and variants, including the delta variant. For the rest of 2021, we expect boosters will initially be more focused on higher-risk patient groups (elderly and immunocompromised), with the broader adult population eligible for boosters in 2022.

We expect strong vaccine sales for Moderna (US$21 billion in 2021 and US$22 billion in 2022) and Pfizer/BioNTech (US$35 billion in 2021 and US$39 billion in 2022), as sales in developing markets and third-dose booster sales to developed markets continue to grow.

Beyond 2022, we assume infants and seniors will be target populations, with close to 70% utilization and US$8 billion in annual sales. We expect Pfizer/BioNTech and Moderna could each see annual sales of roughly US$2 billion. 

Investing Compass
Listen to Morningstar Australia's Investing Compass podcast
Take a deep dive into investing concepts, with practical explanations to help you invest confidently.
Investing Compass

is a guest author

© 2022 Morningstar, Inc. All rights reserved. Neither Morningstar, its affiliates, nor the content providers guarantee the data or content contained herein to be accurate, complete or timely nor will they have any liability for its use or distribution. This information is to be used for personal, non-commercial purposes only. No reproduction is permitted without the prior written consent of Morningstar. Any general advice or 'regulated financial advice' under New Zealand law has been prepared by Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), or its Authorised Representatives, and/or Morningstar Research Ltd, subsidiaries of Morningstar, Inc, without reference to your objectives, financial situation or needs. For more information, refer to our Financial Services Guide (AU) and Financial Advice Provider Disclosure Statement (NZ). Our publications, ratings and products should be viewed as an additional investment resource, not as your sole source of information. Morningstar’s full research reports are the source of any Morningstar Ratings and are available from Morningstar or your adviser. Past performance does not necessarily indicate a financial product's future performance. To obtain advice tailored to your situation, contact a licensed financial adviser. Some material is copyright and published under licence from ASX Operations Pty Ltd ACN 004 523 782. The article is current as at date of publication.

Email To Friend