'The COVID hero is back': Moderna shares surge 177% on cancer vaccine trial success

Shares of US biotech company Moderna surged more than 170 percent in a single session after a personalized messenger RNA cancer vaccine co-developed with Merck delivered positive results in a late-stage clinical trial. Analysts say the milestone could mark a turning point for Moderna as it seeks to reduce its heavy reliance on COVID-19 vaccine sales.

According to Investing.com, Moderna shares closed at $174.38 on Wednesday local time, a gain of 176.97 percent.

The rally was driven by news of the cancer vaccine trial success. Moderna and Merck announced Wednesday that their jointly developed personalized mRNA cancer vaccine had met its primary endpoints — suppressing cancer recurrence and metastasis — in a Phase 3 trial involving high-risk melanoma patients.

It marks the first time a personalized mRNA-based cancer therapy has produced positive results in a large-scale Phase 3 clinical trial.

The personalized mRNA cancer vaccine, intismeran autogene, is designed to prevent cancer from returning after treatment. Unlike a conventional vaccine, it is not administered before a person develops cancer — it is a therapeutic, not a preventive, shot.

The underlying mechanism resembles that of COVID-19 mRNA vaccines, which work by presenting the body with information about a specific viral protein so that immune cells can recognize and remember it.

Where COVID-19 vaccines expose all patients to the same viral antigen, intismeran autogene is tailored to each individual — it shows immune cells the mutations found only in that patient's own tumor.

Moderna and Merck are splitting the development costs and profits for intismeran autogene 50-50. The two companies are in discussions with regulators about a submission process, aiming to obtain marketing approval next year.

Analysts say the trial success could help Moderna overhaul its business fundamentals. The company has been heavily dependent on COVID-19 vaccine revenue, and its earnings have contracted sharply as demand for those vaccines declined after the pandemic. Second-quarter sales this year came in at $145 million, with first-half cumulative sales reaching only about $500 million.

Moderna's mRNA technology was rapidly validated during the pandemic through its COVID-19 vaccine. The company took 11 months to develop, manufacture and win regulatory approval for mRNA-1273, its two-dose COVID-19 vaccine.

As the pandemic receded, COVID-19 vaccine sales fell quickly. Moderna's COVID-19 vaccine revenue dropped from $6.7 billion in 2023 to $3 billion in 2024 and $1.8 billion last year.

Beyond melanoma, intismeran autogene is currently in Phase 2 and Phase 3 trials targeting a range of other cancers, including non-small cell lung cancer, bladder cancer, head and neck cancer, and renal cell carcinoma.

Jung Yi-su, an analyst at IBK Investment Securities, called the Phase 3 success "a critical inflection point that could change Moderna's fundamentals," adding that adjuvant therapy to prevent post-surgical recurrence "has no seasonality, is administered over a long period, and can be applied broadly to patients at risk of relapse — making its demand profile fundamentally different from that of infectious disease vaccines."

Heo Hye-min, an analyst at Kiwoom Securities, said that following the trial success, "how quickly and cost-effectively personalized products can be supplied at scale will determine actual market penetration and profitability."

Price target upgrades followed. JPMorgan raised its target for Moderna to $77.

Morningstar, a US investment research firm, lifted its fair-value estimate for Moderna from $79 to $163, after raising its 2035 revenue forecast for intismeran autogene from $7.2 billion to $16.8 billion.

Karen Andersen, a Morningstar analyst, said the Phase 3 success "demonstrates the potential of Moderna's mRNA technology beyond vaccines."

Still, the sharp price gain has raised valuation concerns. Moderna shares fell 23 percent on Thursday local time as investors took profits following the previous session's surge. Ha Hyeon-ho, an analyst at Shinhan Investment, said that while "medium- to long-term catalysts such as expanded indications exist, the stock has risen sharply in a short period, making entry at current levels a burden."