Moderna Soars 177% on Breakthrough Cancer Vaccine Progress — How Is Wall Street Viewing the Outlook?

Moderna (MRNA-US) and Merck (MRK-US) announced that their co-developed personalized mRNA cancer vaccine, 'intismeran,' has achieved a significant breakthrough in a Phase III clinical trial for patients with melanoma. This marks the world's first cancer vaccine to succeed in a Phase III trial, causing Moderna's stock price to surge 177% in a single day.

Dr. Ezekiel Emanuel praised the results, calling it "a home run, possibly even a grand slam—the outcomes are astonishing."

Wall Street reacted enthusiastically, though opinions diverge:

Tycho Peterson and Andrew Tsai, analysts at Jefferies, expressed extremely high expectations. Peterson stated that this confirms the potential of mRNA beyond infectious diseases and will drive the entire biotech manufacturing ecosystem. Tsai believes this significantly raises expectations for Moderna’s entire oncology pipeline, forecasting that Moderna could launch over seven products across respiratory, oncology, and rare disease areas by 2027 and achieve cash flow breakeven by 2028.

Alex Stranahan, an analyst at Bank of America, called this a "watershed moment" for Moderna, allowing the company to move beyond its identity as an infectious disease player and alleviate capital pressure. He noted that Moderna’s fundamentals have improved substantially compared to 12 months ago.

Citigroup analyst Geoff Meacham took a cautious stance. While acknowledging the encouraging efficacy, he pointed out that Moderna did not disclose key clinical data such as confidence intervals and hazard ratios. He questioned whether the vaccine’s efficacy could be successfully extended to other tumor types, which remains to be proven in future trials.

JPMorgan analyst Jessica Fye warned that the success in melanoma has already been partially priced into Moderna’s market cap of approximately $25 billion. The long-term value will depend on trial outcomes for indications beyond melanoma.

Barclays analyst Eliana Merle expressed optimism, noting the trial met a very high bar for success, which helps validate development for other indications. She estimates a 60% probability of the vaccine achieving approval and commercialization, projecting annual sales of $3 billion by 2035.

With declining revenues from its COVID-19 vaccine Spikevax, Moderna is actively seeking transformation. Beyond melanoma, the company has already initiated testing of the vaccine in lung cancer, bladder cancer, kidney cancer, gastric cancer, and pancreatic cancer.

Meanwhile, Merck faces significant pressure from the impending patent cliff for its flagship product Keytruda in 2028. To mitigate future revenue loss, Merck is engaging in broad collaborations with other pharmaceutical companies. For example, sacituzumab tirumotecan, co-developed with China’s Sichuan Kelun-Biotech, combined with Keytruda, has demonstrated significantly improved progression-free survival in late-stage clinical trials for advanced non-small cell lung cancer.

Moderna and Merck plan to submit data to federal health regulators shortly to seek marketing approval for the intismeran combination therapy.