After nearly three years in a heated race to distribute vaccines and drugs against the most severe pandemic in a century, biopharma's COVID-19 market fades more and more each quarter. Next year, we'll see more changes that'll force the top players to pivot.
In 2020 and 2021, Moderna and Pfizer—with BioNTech at its side—shot out of the gate with their respective mRNA COVID-19 vaccines, quickly earning spots as top moneymakers on the pandemic scene. It’s a story that doesn’t need recapping, but the height of the action seems to be winding down.
Throughout 2022, market watchers have seen COVID-19 vaccine sales start to waver. After reporting third-quarter earnings, for instance, Moderna slashed its annual sales projection for its vaccine from $21 billion to the $18 billion to $19 billion range.
For its part, BioNTech's sales cratered in the quarter to $3.49 billion, falling 43% versus the same period in 2021.
On the flip side, Pfizer boosted its annual projection by $2 billion to $34 billion after delivering a strong quarter, signaling there is some momentum left for the market.
So, what’s next?
2023 should present a challenge for companies hoping to repeat their pandemic sales hauls—and so far companies are staying mum on their expectations. Lee Brown, global sector lead for healthcare at Third Bridge Group, said this fall that the three pandemic superstar companies will “struggle with the transition to the post pandemic environment” as COVID revenues decline alongside earnings.
In the immediate term, it appears uncertainty is on tap. During BioNTech's third-quarter earnings call, the company declined to forecast 2023 vaccine sales, citing factors such as uncertainly in demand, pricing and variants.
“I think we’ve got to move away from the thinking on the order book,” BioNTech Chief Financial Officer Jens Holstein said at the time. “It will take probably a few years. The danger really is to draw the wrong conclusions from some number on an order book. Therefore, we’re moving away from giving some guidance.”
Moderna, similarly, was unable to provide a figure for expected 2023 sales, with Chief Commercial Officer Arpa Garay in November citing “a number of variables” that hindered a reliable forecast.
Still, Moderna has estimated that the annual COVID-19 booster market could be the size of the U.S. flu shot market. Third Bridge's Brown disagrees.
"Previously, consensus estimated the number of annual COVID-19 shots would approximate the number of annual flu shots, but now the U.S. market could be as low as one-third the size of the flu market,” Brown wrote this fall, citing less enthusiasm for booster shots.
A private market
Even as analysts and vaccine makers work over their projections for 2023, another coming wrinkle should complicate their calculations. The U.S. market will likely soon turn private after years of government funding.
Early in 2021, Pfizer Chief Financial Officer Frank D’Amelio warned on an earnings call that the company would “obviously” be going to “get more on price” after the “pandemic pricing environment.” More recently, the company has reaffirmed its plans for higher pricing levels in the private market.
In October, Pfizer global primary care and U.S. President Angela Lukin said during an investor call that the price would likely grow to about $110 to $130 per dose after the last government supply contract expires. She predicted the higher price would likely kick in during the first quarter of 2023.
So far, the government has been getting vaccine doses for under $30 on average.
Meanwhile, Moderna at its September R&D day pegged its commercial price (PDF) expectations between $82 and $100 per dose.
As Pfizer CEO Albert Bourla, Ph.D., sees it, his company can be “even more competitive” in a private market. During a conference call this summer, the helmsman said he thinks his company is “even better suited” for the private market because of its marketing ability.
Even with these higher expected prices, Kaiser Family Foundation healthcare experts Jennifer Kates, Cynthia Cox and Josh Michaud believe most people with health insurance will still be able to secure COVID-19 vaccines for free even after the government supply runs out. But the team noted noted the higher price could discourage vaccination among those who are uninsured or underinsured.
A new race kicks off
Meanwhile, as the COVID-19 vaccine race continues to evolve, another vaccine market could begin to unfold in 2023.
The respiratory syncytial virus (RSV) race features key players such as Pfizer, GSK, Sanofi and AstraZeneca. The market is said to be worth $10.5 billion over the next decade, SVB Leerink analyst Geoffrey Porges wrote to clients in 2021. At the time, Porges expected GSK to pick up $2.9 billion of that total revenue by 2030, with Pfizer taking $2.1 billion, J&J collecting $1.7 billion and Sanofi snagging $1.2 billion.
Now, GSK and Pfizer are almost neck-and-neck in the race to the FDA finish line for their respective vaccines. GSK secured a priority review and a May 3, 2023, approval action date for its RSV vaccine in older adults, while Pfizer got its priority review and May 2023 action date just a month later.
Sanofi and AstraZeneca, meanwhile, won a European approval for their RSV prevention antibody, Beyfortus, in November. The companies haven't yet submitted the drug to U.S. regulators.