Is Moderna Solving Cancer?Jan 03, 2023
Stock: Moderna ($MRNA)
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Last year, we wrote about how advancements that were pushed forward during the COVID pandemic were leading to huge advancements in treating other complex diseases.
We focused in on antibody treatments for cancer.
But now let's look at the other side of that coin and see how mRNA technology is completely revolutionizing the fight against cancer.
And to top that, we'll take a look back at one of the OG Moby.co stock picks: Moderna ($MRNA).
Moderna has come a long way since we initially launched our position in early 2021, but that pick has paid brilliantly and is about to head to the next level.
While Moderna has been buffeted by being overbought and oversold in a hype-heavy market the last year-and-a-half, they are finally stabilizing and raising revenue in a more sustainable way.
More importantly, at the end of last year, Moderna announced astonishing Phase II trial results of a new application for mRNA technology that is currently in the process of revolutionizing how we treat cancer.
In partnership with Moby.co pharma favorite Merck, Moderna has managed to develop a personalized cancer vaccine (PCV) that when combined with Merck's Keytruda drug has astonishing efficacy against skin cancer.
The word 'vaccine' is a little misleading there -- but these results are still astonishing and have sent Moderna's stock soaring.
Now that things have calmed down from $MRNA honestly getting a little overbought in the hype cycle that came after these announcements, let's dive through what this means and what other treatments Moderna has lined up that will continue to revolutionize healthcare for decades to come. 👇
Moderna was legitimately one of the very first stocks we covered at Moby.co back in late 2020.
Since we placed a big bet on their COVID vaccine being successful, the stock peaked at 4x'ing our price target.
But yes, MRNA rode to prominence on being one of the first to the market with an effective COVID-19 vaccine in partnership with BioNTech.
Since then, Moderna's revenue exploded off of initial demand for said vaccine and has since been pretty up and down with cyclical demand for their vaccine and new variant updates.
Revenue is finally stabilizing at MRNA with normal demand, robust COVID vaccine competition, and more predictable supply chains.
Despite the competition and COVID revenue set to go down, MRNA still managed to increase yearly revenue by 30% in 2022 -- which is providing a stable foundation for the huge news 👇
Moderna is Wrecking Cancer:
All of the wild price action coming out of Moderna right now stems from phase II trial data for a drug Moderna lovingly calls mRNA-4157. A super evocative name, we know.
This is a pioneering medicine that is an mRNA-based Personalized Cancer Vaccine (PCV).
Like we said before, this isn't technically a vaccine in the way you currently understand it. This isn't a shot that like, prevents patients from getting cancer.
Basically, you're kind of getting cancer all the time, and your immune system is really good at identifying and getting rid of it. "Successful" tumors that become full-blown cancer are better at camouflaging themselves as normal parts of your body.
Moderna's treatment here relies on doctors taking cells from each individual patient's tumors, identifying markers on those cells that are like an ID card for said tumor, and then using their mRNA technology to create a "vaccine" that teaches a patient's immune system to attack the tumor and destroy it.
Look, if you had the patience to read through that, I have a lot of respect for you. The short of it is simple: mRNA allows doctors to have way stronger tools as they treat cancer.
Combined with Merck's Keytruda cancer treatment -- phase II trials of Moderna's PCV showed a 44% reduction in reoccurrence and death for Melanoma (skin cancers) as compared to Keytruda alone. Keytruda already is a WILDLY powerful cancer treatment, so this PCV making it almost 50% more effective is a HUGE blow to cancer as a concept.
Regulatory approvals take time on this, and MRNA will likely have to demonstrate efficacy for lots of different categories of cancer, but there's a path for absolutely astronomical revenue gains as Moderna continues to demonstrate the ASTOUNDING efficacy of mRNA treatments for disease.
All of the wild price action in Moderna in the last few weeks stems from one phase II trial. We're expecting that MRNA can get this cancer treatment all the way to the final regulatory review by the second half of 2023.
This would be huge for the stock, but moreover, this would be another massive demonstration that Moderna's ENTIRE research pipeline has a stronger likelihood of being effective.
Moderna has a wide range of vaccines in development, including a groundbreaking treatment for preventing HIV entirely.
The main reason we're publishing this report now though is that Moderna's price has finally corrected to a smarter range after being massively overbought on the news that came out of this trial.
This could also be insiders selling at the end of the year for tax purposes, but now that the stock has come down 13% in the last week, we see this as a good opportunity to re-up for the next 2-3 year cycle.
We're still in the top of the first inning of this mRNA revolution and Moderna has a lot of brilliant treatments in their pipeline and a huge moat to keep competitors at bay.
We're excited to keep our position in MRNA and we can't wait to see where they take this from here!
Risk / Reward: High / High
P/E Ratio: 6.6x
Market Cap: $69B
Dividend Yield: 0%