Moderna’s New European Team Readies For COVID-19 Vaccine D-Day
Gearing Up For A Huge Commercial And Manufacturing Challenge
Executive Summary
After a stunning first efficacy readout for its mRNA-based vaccine, the biotech company's leaders in Europe talk about their rapid commercial and manufacturing scale-up.
At the start of 2020, Moderna was already very much ‘one to watch’ in the biotech world – but few would have predicted it would be a leader in the race to develop a vaccine against a deadly pandemic – a race where the finish line now looks to be approaching.
The company has never launched a product before, and had expected to spend this year preparing for a first approval of one of its mRNA-based products in 2022 at the earliest.
Fast forward to late November 2020, and Moderna’s COVID-19 vaccine MRNA1273 has produced very impressive interim efficacy results from its Phase III trial. (Also see "Moderna Aces COVID-19 Vaccine Results With 94.5% Efficacy" - Scrip, 16 Nov, 2020.)
The independent data monitoring safety board reported that the trial produced a 94.5% efficacy result from its first 95 cases. This is on a par with results from
Pfizer/BioNTech, and both candidates now look set to gain emergency use approval (EUA) from the US Food and Drug Administration by the end of this year, and from other regulators by early 2021.
These have now been joined by AstraZeneca/Oxford University’s AZD1222, which has produced an interim efficacy level of 62% . That is well below the level seen in the mRNA frontrunners, but is likely to be a significant player nonetheless, thanks to its lower price, easier manufacturing and storage requirements. (Also see "AZ Will Sideline ‘Lucky Mistake’ To Secure COVID-19 Vaccine Approval" - Scrip, 27 Nov, 2020.)
The two mRNA-based COVID-19 vaccines and AZ’s adenovirus-based product look set to be the first to help turn the tide against SARS-CoV-2, arriving as cases surge again in the US and Europe. The first tens of millions of doses from each vaccine are expected to be available before the end of year, with manufacturing ramping up into the billions of doses in 2021.
But unlike Pfizer and AstraZeneca, Moderna has never launched a product before. Its COVID-19 vaccine readout therefore has an added dimension, representing a validation for the company’s mRNA platform, which has been 10 years in the making, and a crucial first step into becoming a commercial enterprise.
Building A Commercial Enterprise At Speed
In early 2020, Moderna had had no commercial infrastructure in place whatsoever, and no manufacturing capacity outside the US. The company has had to undertake the scale-up of these operations in parallel with the clinical development of MRNA-1273, an enormous global challenge for any organization.
Moderna's European commercial head Dan Staner
Ex-Lilly executive Dan Staner was hired to set up and lead Moderna’s international operations, being appointed its head of Europe/Switzerland, Middle East & Africa in August. This made Staner only the third person recruited into the company’s commercial operations anywhere in the world.
He is working hand in hand with another key recruit to the company, Nicolas Chornet, senior vice president of international manufacturing, Europe.
Staner had spent more than 18 years of his career at Lilly, leading in senior commercial roles in Europe, Asia, the Middle East and Africa, but decided to leave the company in search of a new challenge late last year.
"Seeing what society is going through, there is nothing more tangible [than a vaccine] when it comes to embarking on this mission and saving lives.”
By summer 2020, he had found that challenge: SARS-CoV-2 was tightening its grip around the world, and Staner knew he wanted to play a role in beating the virus.
“Having worked in this sector for 25 years, having the goal of making life better for people around the world is something that has always resonated with me,” he told Scrip before any of the interim results were unveiled.
"But the current crisis, and seeing what society and economies are going through, there is nothing more tangible when it comes to embarking on this mission and saving lives.”
He approached Moderna to offer his services in Europe, where he saw great potential for the US company, but also a need for speed and experienced people on the ground to navigate the complexities of European and other non-US markets. By the late summer, he had begun the job of building up the biotech’s commercial operations from its new regional base in Basel, Switzerland.
Staner had also worked previously with Moderna’s CEO Stephane Bancel at Lilly, where Bancel had been head of global manufacturing strategy and supply chain, and then managing director of Lilly in Belgium. “To work with a leader like him, that was a chance I didn't want to pass up,” said Staner.
No Big Pharma Partner
The potential of developing a COVID-19 vaccine has transformed Moderna’s commercial outlook, opening up a multi-billion commercial opportunity, which could sustain it for several years and help fuel the development of its broad mRNA-based pipeline of novel vaccines and cancer therapeutics.
However, commercial expectations are sky high. The company’s market cap now stands at an eyewatering $51bn – and the pressure is on to fulfil investors’ expectations in 2021 and beyond.
Analysts forecast that the global market for the vaccines could be worth up anywhere between $10bn and $25bn in 2021. Over the summer, analysts at Jefferies forecast that around 100-200 million people will receive a COVID-19 vaccine worldwide in 2021, and forecast that Moderna could achieve a market share of 20-25%.
Jefferies predicted a share of around 50 million people at a price of $50 a treatment ($25 per dose) for 2021, which would give Moderna revenues of around $2bn in its first year.
So how best for a biotech company with no commercial infrastructure to go about seizing this opportunity? Germany’s mRNA-based biotech BioNTech found itself in a similar position in early 2020, and decided to take on Pfizer as its big pharma partner to help with R&D, commercialization and manufacturing worldwide.
Moderna, by contrast, decided to go it alone, unquestionably a higher risk strategy. But CEO Bancel is convinced that its COVID-19 vaccine presents a unique opportunity to establish a commercial platform in the US and Europe for future launches over the coming years.
It has signed partnerships with contract manufacturing experts Lonza to boost its global production, and with Takeda to bring the COVID-19 vaccine to the Japanese market.
But it the US and Europe, Moderna is scaling up its commercial operations fast. In Basel, Switzerland, the company has built a core team across medical, regulatory, pricing and reimbursement, market access, government affairs and commercial operations, and continues to recruit.
Can Moderna Charge A Premium?
The company has already agreed a number of deals with governments worldwide. The most important of these being a $1.52bn deal to supply the US government with 100 million doses (via the Operation Warp Speed program) with an option to add up to 400 million doses.
In Europe, Moderna has lagged behind other COVID-19 vaccine frontrunners in terms of securing a commercial deal with the European Commission, but has now finalized an agreement. The deal is based on an initial 80 million doses, with an option of a further 80 million doses.
This is significantly smaller than other deals already agreed between other COVID-19 vaccine developers and the EU, though.
One of the biggest EU deals has been secured by AstraZeneca/Oxford University, which is developing its adenovirus-based vaccine at a not-for-profit price. Should it gain approval, AZ will supply 300 million doses to the EU’s 27 member states, with an option to purchase 100 million more.
While the European Commission maintains the pricing deals are confidential, Reuters has reported that the EU is paying AstraZeneca just €2.5 ($2.92) per dose, while another supplier, Sanofi, has negotiated a price at around €10 per dose.
Pfizer/BioNTech just finalized an agreement to supply the EU with 200 million doses, plus an option for a further 100 million. EU officials have declined to give a precise figure to the deal, but have confirmed it will pay less than $19.50 per injection agreed with the US.
Germany’s CureVac has secured the biggest EU deal so far, however, with an initial 225 million doses agreed (dependent on clinical success and regulatory approval) at a cost of €10 per dose, and an option on a further 180 million.
These low prices have made it tricky for Moderna, which wants to make a good return on its first ever product. It is looking to charge a significantly higher price of around $25 per dose ($50 for the two-dose regimen), but is likely to have reached a compromise to secure a deal with the EU, which was seeking a discount below this level.
“It's difficult for us to talk about price, because it's confidential,” said Staner. “What I would say is that we're bringing now a new class of mRNA drugs which hopefully will help fight diseases in the future.
“In this fight against the pandemic, we expect to bring this vaccine at a reasonable price. I think Stephane Bancell has made it clear that we will not be able as a biotech company to make it at that non-profit level. That is impossible as we have invested in R&D for the last 10 years, so we have to make a margin. But we have also pledged that any profit we make will be immediately reinvested in R&D.”
Its encouraging interim efficacy results, and the fact that its first supplies will be among the first to come on stream will play to its advantage, however. Bancel has made it clear the company believes it can show superior efficacy and convenience compared with Pfizer’s product by early 2021, which would strengthen its hand when governments seek to purchase more supplies
However the COVID-19 vaccine field will not simply depend on price. Other major factors include the relative safety and efficacy profile of the candidates, the convenience of dosing and refrigeration requirements and the availability of billions of doses by the end of 2021. Bancel has made it clear he believes his company’s vaccine will prove its superiority in the coming months - but that ‘frontrunner’ status could nevertheless be eroded very quickly.
The Manufacturing Challenge
As more vaccines produce interim results, the focus is rapidly switching to the challenge of meeting global demand in manufacturing and supply. This is challenging for Moderna, as no mRNA-based vaccine has ever been produced before, and also because this will be Moderna’s first ever product launch.
Moderna currently expects to have the first 20 million doses ready to ship in the US by year-end 2020 and between 500,000 and 1 billion doses in 2021.
That means there will be no supplies of MRNA1273 outside the US before 2021, even if the European Medicines Agency grants it a rapid approval before the end of this year.
Pfizer and BioNTech have a clear advantage, thanks to the big pharma company’s established vaccines manufacturing network. They currently expect to produce globally up to 50 million vaccine doses in 2020 and up to 1.3 billion doses in 2021.
Wary of ‘vaccine nationalism’ friction over supplies, most COVID-19 vaccine frontrunners have set up parallel supply chains, one serving the US, another serving the rest of the world. Moderna’s US operations are based around its facility in Massachusetts and contract manufacturing services company Lonza in New Hampshire, while Lonza’s site in Visp, Switzerland will produce the vaccines for the rest of the world.
The company expects these two supply chains to remain distinct for at least the first two quarters of 2021, after which demand could ease off somewhat, allowing for production to flow into a single global output.
“We are a platform-based company – we can process the different mRNAs we develop for different therapies. So we will leverage all the infrastructure we install for the coronavirus vaccine."
As head of ex-US manufacturing, Moderna’s Chornet concedes that Pfizer has the advantage of scale. “Pfizer has quite an expansive footprint from an industrial standpoint. But we are working very well here. If we [the European team] need to make a decision on international manufacturing. we can do that very quickly.”
He is confident the company is on track for rapid ramp up in early 2021: “We may be small but we can move pretty fast, and that’s exactly what we're doing now.”
Chornet said that Moderna’s strategy is to build this infrastructure now so it can create a launch pad for its extensive pipeline, which already includes 13 candidates in various stages of clinical development. These include a potential first-in-class vaccine for cytomegalovirus, now entering Phase III, which Bancel believes is a potential $2-5bn annual revenue product.
The company also has numerous novel cancer modalities in its pipeline, plus plans to enter the global flu vaccine market.
“We are a platform-based company – our technology is a single platform that can process the different mRNAs that we develop for different therapies. So we will be able to leverage all the infrastructure that we currently install here for the coronavirus vaccine."
Building Moderna In Europe
Moderna is recruiting new staff in Europe, but is maintaining a very rigorous selection process. Staner himself had to undergo a two-month selection process which involved no fewer than 12 interviews, and a psychological analysis exercise.
As the pandemic has forced all companies to be far more ‘virtual’ than before, he thinks Moderna is at the forefront of a revolution in how biophama companies operate.
“You just need the right brain and be able to connect. More and more virtual work [is needed] and more and more ability to connect between teams. That’s going to be essential, so that could become a new way of working [including] for research and development.”
Staner denied media reports of Bancel being difficult to work with, while admitting that Bancel does motivate and inspire by expecting high standards of his teams. He used a French word – exigence – to describe this quality, the meaning residing somewhere between ‘demanding’ and ‘expectation’.
“[Bancel] absolutely is a great guy with a great expertise. He has this broad knowledge, he can talk about development….manufacturing and commercial. He's approachable, but he has a high level of exigence, and that's something that I value and share fully.
“With the pressure from society and economies, we need all to be exigent with ourselves, and with our respective teams and that's something which I value.”
Fast-Tracking Approval Without Compromising Quality
The US FDA, EMA and other major regulators are working to expedite approvals of COVID-19 vaccines whilst maintaining rigorous standards, especially on safety data.
“You can always pick up the phone and just dial into the regulatory agency and have somebody who is dedicated to working on your particular compound and company, which means the speed is incredible, without compromising quality at all,” Staner said.
The EMA has launched a rolling review of several of the leading candidates, adding Moderna to that list on 16 November. Decisions from US FDA look certain to come before the end of 2020, with Europe following close behind.
“What's happening [with the pandemic] across the US and Europe is really getting bad,” said Staner. “Hopefully we will soon pass the finish line and be able to bring a vaccine to help countries around the world.”