(Bloomberg Opinion) -- About two months after Moderna Therapeutics Inc. released preliminary Covid-19 vaccine data that sent the stock market into a tizzy, the company published a complete look at the initial human trial of its drug late Tuesday — and it promptly moved the market again.
Moderna shares surged 20% on the results in after-market trading, and stocks in general got a lift as well. Is it warranted? For sure, the expanded results published in the New England Journal of Medicine contain good news about the vaccine's early attributes. However, they mainly put what the company revealed in its sparse May release on firmer footing instead of breaking swaths of new ground as one might expect from the reaction. In short, investors may be ahead of themselves.
There are a host of open questions about the vaccine's clinical and commercial potential. They won't be resolved until Moderna finishes a huge clinical trial currently scheduled to begin July 27. New investors would be paying a hefty price for a long wait and a still high level of risk.
According to the expanded results, two shots of the Moderna vaccine generated antibody levels higher than those generally seen in people that recover from Covid-19. The company’s initial release suggested something similar. Still, the new publication shows results in a broader group of patients and goes into needed detail about precisely what Moderna was measuring. Investors should feel more secure in the notion that the vaccine produces an immune response, a real milestone.
However, just as in May, it's not clear whether people who survive Covid have durable immunity to the virus and how that relates to antibody levels. A further relationship between antibodies and vaccine effectiveness still needs to be proved in a robust trial. The company isn't necessarily measuring the wrong thing; antibody levels are as good a target as scientists have at the moment. But the human immune system is complicated and researchers have much to learn.
While Moderna is undoubtedly a front-runner, it's not alone. It will be neck-and-neck with Pfizer Inc.'s similar vaccine as well as AstraZeneca Plc, with others following soon. There's no guarantee that it will finish first or with a happy result. There's some randomness to placebo-controlled vaccine trials; a significant number of people on the control arm have to contract the virus to prove the shot effective by comparison, and that could take time.
Moderna's trial will focus on areas where the virus is spreading, but so will everyone else's. If another drugmaker recruits faster, has a more effective shot or gets lucky with a higher rate of infection on the placebo arm, they could move ahead.
Other details: The company's expanded results didn't reveal any "serious" adverse events like a death or a life-threatening reaction, but the vaccine did produce a noticeably high rate of side effects including fatigue, fever, and muscle pain. New safety concerns could arise in the larger trial; the company has 45 people’s worth of data; thousands more will get the shot in the months to come. While the Food and Drug Administration is likely to be relatively flexible on safety for an effective vaccine, unpleasant side effects could diminish uptake and commercial opportunity, especially if there's a more appealing option.
Investors may be excited by Jefferies Analyst Michael Yee's prediction that Moderna could reap $5 billion in sales, but none of that materializes if the vaccine doesn't work. Even if the company succeeds and navigates competitive risks, the hefty dose of U.S. taxpayer money that has gone into the company's effort will create extra pressure to price modestly.
Moderna, up 283% year to date, is priced for multiple best-case scenarios right now. Investors convinced it’s still a strong buying opportunity should have their eyes open.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Max Nisen is a Bloomberg Opinion columnist covering biotech, pharma and health care. He previously wrote about management and corporate strategy for Quartz and Business Insider.
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