On Thursday, Moderna, the renowned biotechnology company, released its second-quarter results, surpassing market expectations yet revising its full-year sales predictions for its respiratory business downward due to intensified competition within the US market and diminished demand across the European Union.
This strategic adjustment is indicative of the evolving landscape in the vaccine industry, particularly as it pertains to respiratory treatments. Moderna has now revised its forecast for net product sales from its respiratory franchise to a range between $3 billion and $3.5 billion, a notable decline from the previous outlook of $4 billion.
The company disclosed that this dip is predominantly attributed to "very low" anticipated sales in the EU for the current year, possible revenue deferments for several international transactions into 2025, and an increasingly competitive market for respiratory vaccines in the US. "We remain committed in our attempt to mitigate these risks, but believe it's appropriate to adjust our guidance at this time," said Chief Financial Officer Jamey Mock during an earnings call, as reported by Capital IQ's transcript.
Following this announcement, Moderna's shares plunged significantly by 18% in Thursday's trading session. Looking ahead, for the latter half of the fiscal year, Moderna is anticipating a sales distribution of approximately 40% to 50% in the ongoing quarter, with the remainder expected in the fourth quarter, contingent upon regulatory approvals.
The company has reiterated its full-year forecasts for research and development expenses projected at roughly $4.5 billion and selling, general, and administrative costs estimated at about $1.3 billion. For the June quarter, Moderna recorded a net loss of $3.33 per share, in contrast to a loss of $3.62 per share in the year prior.
Analysts on Capital IQ had estimated a per-share loss of $3.35, highlighting the financial pressures faced by the company amidst changing market dynamics. The total revenue experienced a decline, dipping to $241 million from $344 million in the corresponding quarter of the previous year, as sales of Moderna's Spikevax COVID-19 vaccine plummeted by 37% to $184 million.
This decrease in product sales is consistent with the anticipated transition to a seasonal COVID-19 vaccine market, where a surge in demand is expected during the fall and winter months, as per the company's projections. Remarkably, the topline revenue did outpace the market's anticipated figure of $134.9 million. During this quarter, Moderna highlighted the milestone of obtaining approval for its second mRNA product while also significantly curtailing its operating costs.
Chief Executive Stephane Bancel underscored the company's dedication to executing plans for the upcoming 2024-25 COVID season and launching its respiratory syncytial virus vaccine within the US market. The cost of sales saw a considerable reduction, descending to 62% of product revenue compared to a staggering 249% in the prior-year quarter.
Furthermore, selling, general and administrative expenses decreased by 19%, coming down to $268 million, while research and development costs witnessed an increase of 6%, reaching $1.22 billion, as detailed by the company..