According to the agreement, Moderna will pay a total of up to $2.25 billion to Roivant Sciences subsidiary Genevant and Arbutus Biopharma. The first tranche of $950 million must be completed by July 2026.
Payment of the remaining $1.3 billion is subject to the outcome of a separate appeals process.
An important element is that Moderna will be able to use the technology in its vaccines in the future without paying royalties, which analysts consider a significant achievement.
Payout cap falls short of the more than $3 billion previously expected on Wall Street Geoffrey Meacham, an analyst at Citi, pointed out. Experts say the deal will allow investors to refocus on Moderna’s cancer vaccines under development. The results of the late phase clinical trials of these programs are expected to arrive in 2026.
However, Bernstein analyst Courtney Breen cautioned. He calculated that if the full $2.25 billion is paid, the company’s cash holdings could drop to as low as $3.2 billion by 2026, down from $4.5 billion to $5 billion expected this year.
Breen sees this as “narrowing room for maneuver,” especially since the outcome and timing of separate lawsuits against Pfizer and BioNTech over mRNA patents remain uncertain.
Moderna’s shares have fallen about 90 percent from their 2021 peak due to a collapse in demand for Covid-19 vaccines. One of the key takeaways from the current deal is that the company can once again focus on product development instead of litigation, particularly its oncology programs, which management sees as key drivers of long-term growth.
Source: Reuters
The cover image is an illustration. Cover image source: Getty Images
This article does not constitute investment advice or investment recommendation. Detailed legal information
