Today the authorities in Washington will give the green light to one third dose of Moderna or Pfizer Biontech vaccine (the two drugs based on m-Rna technology) for weak patients, ie transplant recipients and subjects afflicted by severe immune deficiencies, such as cancer patients and those undergoing treatment with steroids. Tomorrow the green light will also arrive Food and Drug Administration, supported by the results of research, the latest of which produced by the Canadian authorities, which, based on studies on Moderna, confirm the effectiveness of a third dose of vaccine on the weakest. Meanwhile, after the OK from the European Union to recognize a price supplement to the vaccines of the two companies, a new billion-dollar agreement arrived last Friday, this time with Australia.
In short, everything is going well for the champions of the anti-Covid war, starting with Modern, the former laboratory created eleven years ago by the French scientist Stephane Barcell, which within a few months entered the circle of Big Pharma. Fast, too fast for Geoffrey Meachan, a Bofa-Merryll Lynch analyst, which he posted online on Monday evening a devastating stock report, arrived, according to him, to “ridiculous quotes”. That is 195 billion dollars, more than Amgen, the jewel and pioneer of biotech therapies which in 40 years has come to capitalize 130 billion, or Merck, the pharma giant, which is close to 190 billion.
Nothing new under the skies of Wall Street, one could object, citing the example of Tesla, which has burned away the competition from all car groups thanks to the adoption of a new technology. But the numbers listed by Meachan they are nonetheless impressive. To justify the value of the share (+544,6% in one year), Moderna should:
- distribute 1-1,5 billion doses of vaccine annually by 2038;
- develop, with a 100% success rate, all investigational drugs, both those in phase 2 and the ten in phase 1 that have not yet been tested on humans.
In short, two impossible feats, yet necessary to justify a turnover (30 billion dollars a year against the 7 so far collected by the anti Covid vaccine) in line with the quotation.
And so Meachan, although he has long been a great supporter of the therapies developed by Moderna and Biontech, has issued a creepy downgrade: Modern is not worth more than 115 dollars per share, against the 450 of the quotation on a Monday morning, before the fury of the sellers broke out.
Within a few hours, yesterday the title Moderna suffered a 15% loss abundant, that is 30 billion of market value, soon imitated by Biontech (-13,7%), while the battleship Pfizer limited the damage to around 4%, which is worth around 10 billion. In short, a good blow, about 60 billion dollars lost in a few hours, which is particularly bad because it fell after last Friday's fireworks, when Moderna had achieved a 17% increase justified by the stock market reports from the agreement with Australia for the distribution of the vaccine.
But, in hindsight, not even the sale of ten doses of vaccine per inhabitant (8 including kangaroos and koalas) justified such a leap. Bravo and lucky, therefore, Mr. Meachan, to grasp the weak side of Moderna, unleashing the legions of bears who, frustrated by a horrible year for them (see the blows suffered on Tesla) go to attack the most fragile positions ( included in Ark Investment funds and ETFs managed by Catie Woods, the first fortress of the new economy in all its variants).
It looms a new billionaire clash: on the one hand, RNA-based therapies, the new frontier on which to focus not only for Covid, but also for a long series of illnesses that are currently incurable; on the other, the logic of numbers to oppose the irrational euphoria that lies in the DNA of the financial markets. But, as befits, with a hint of yellow: it is all too easy to think of insider trading which, between Friday and Monday, could have yielded a billionaire fortune to well-informed people. The investigations by the SEC have undoubtedly already begun. Maybe they'll come up with something, more likely not.
