Moderna CEO discusses China investment, expanding vaccines

Moderna (MRNA) is advancing three of its vaccines into Phase Three trials as the pharmaceutical giant hopes to expand its product pipeline past its COVID-19 vaccine, sales of which fell by 43% year-over-year in 2023.

Yahoo Finance Health Reporter Anjalee Khemlani recaps her interview with Moderna CEO Stéphane Bancel, who discussed the company's $1 billion investment into mRNA manufacturing sites in China.

"There's a very strong agreement at the highest level between the US government and China government that they want to collaborate on health care, on the climate, and on food insecurity," Bancel says. "We have all those vaccine in respiratory and in latent. We want as many people in the world to be able to benefit from those products so that we prevent disease."

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Editor's note: This article was written by Luke Carberry Mogan.

Video transcript

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- Moderna looking to rebound from its COVID slump the pharma company announcing advancements in its Moderna and mRNA rather vaccine pipeline, along with unveiling positive phase III trial results for its next generation COVID 19 vaccine. Yahoo Finance health reporter Anjalee Khemlani is here with us. Anjalee, what did you learn in this interview?

ANJALEE KHEMLANI: Well, it's interesting because Moderna we as just the COVID 19 company. But it's entering a year of potential growth, pulling the company back from that post-pandemic lull that we saw last year. And that's why CEO Stéphane Bancel announced these new initiatives, the new vaccine updates at their annual vaccines day today.

The company is also looking to boost its global presence with a $1 billion investment in mRNA manufacturing in China. And we know that's an important area, large market cap firms play in. But recent efforts by Congress to ban Chinese biotech companies has been creating a little bit of tension in the industry.

It seems like this tension is not spilling over for Bancel. He told Yahoo Finance earlier today that he is not worried. Here's what he had to say.

STEPHANE BANCEL: I think there's a very strong agreement at the highest level between the US government and China government that they want to collaborate on health care, on the climate, and on food insecurity. Those are the three topics where at the highest level they want to collaborate. We want to help people and to protect people. That's what the company has been set up for. With all those vaccines in respiratory and in latent, we want as many people in the world to be able to benefit from those products, so that we prevent disease.

ANJALEE KHEMLANI: So potentially carve outs there for the company. Meanwhile, Moderna is also focused on ramping up its research and development. That's an area that has to be dedicated to, to continue that growth. It recently got a $750 million infusion from Blackstone Life Sciences for its flu program. And that's the initial thing that Moderna had been working on before diverted to COVID.

It's also advancing several candidates in its pipeline that would boost off season business despite cutbacks on manufacturing last year. One of its biggest partners there was Catalent. And they are now being acquired by Novo Nordisk. So I asked Bancel if that's going to change anything or affect the company. Here's what he said.

STEPHANE BANCEL: The purchase of Catalent by Novo Nordisk did not affect anything for us because actually we were moving out of Catalent, the Indiana site, which is the one considered there as part of our planning for 24. What is important is the latent virus are not produced during the season.

So if you think about Moderna, today our manufacturing is not as efficient as it should be because we make COVID for the season. But let's say in Q1, we don't make much product. We make clinical trial lots for all the clinical trial studies, but we don't make commercial product in our factory.

So all those latent virus as they launch we can make them in Q1 or Q2 ahead of a season and have a much better utilization, and our cost of goods will improve a lot as we launch those products. So we don't need to add manufacturing. We don't need to add CapEx. So it's a great news in term of our efficiencies and the return on equity we can create.

ANJALEE KHEMLANI: So it looks like that worked out for the company at least. But we'll have to see how these vaccines progress in the pipeline and wait till they actually get to market.