The last time you heard of Moderna (MRNA) was likely because of its mRNA Covid vaccine, but that same tech, once administered en masse, could soon become a life-changing, specialized cure for cancers. The recent breakthrough came from its intismeran autogene, or more formally mRNA-4157/V940, Moderna's personalized mRNA cancer therapy developed alongside Merck (MRK), which met its primary recurrence-free survival endpoint in a late-stage melanoma trial.
The result sent MRNA stock soaring 176.97% on Wednesday because intismeran autogene is designed around the unique mutations found in an individual patient's tumor and trains the immune system to recognize and attack cancer cells left behind after surgery. More importantly, this isn't just a melanoma result.
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Moderna and Merck are already testing the technology across several other cancers, raising the possibility that this breakthrough could validate an entirely new pillar of Moderna's business.
www.barchart.com Why the Breakthrough Is So Big
The key thing to understand is that intismeran autogene is not a one-size-fits-all cancer drug. Moderna and Merck create a treatment tailored to the mutations found in each patient's tumor, with the mRNA instructing cells to produce selected cancer-specific neoantigens. The goal is to train the immune system to recognize those targets and hunt down residual cancer cells before they can cause a recurrence.
Surgery often fails to fully get rid of the cancer, and even tiny amounts of it can spread elsewhere and kill a patient regardless. This is why this breakthrough is so promising.
In Moderna and Merck's latest late-stage study, patients who received intismeran autogene alongside Keytruda did better than those who received Keytruda alone. And melanoma may only be the beginning. Moderna and Merck are already testing the same personalized mRNA approach in other cancers, including lung, bladder, and kidney cancer.
Why You Should Expect the Euphoria to Fade
Wall Street is currently trying to price in years of success for MRNA stock all at once, and that is already fading. The stock is down 16% after popping 177%, and I expect it to decline further as more quarters pass without a significant revenue/earnings bump.
Intismeran autogene still has to clear the regulatory process before Moderna and Merck can sell it, and the companies are only discussing potential submissions with regulators for now. Even if everything goes according to plan, analysts expect a possible launch in 2027, while Moderna itself has previously pointed to meaningful oncology revenue arriving later in the decade.
Wall Street isn't particularly famous for its patience, and plenty of buyers are there on momentum rather than intending to hold Moderna through years of drug development. There is also significant future success embedded in Moderna's new valuation. Analysts have estimated that intismeran autogene could eventually generate billions of dollars in annual melanoma sales, but Moderna splits the economics of the therapy with Merck.
I still expect MRNA stock to trade much higher than before, but you shouldn't expect the stock to hold at 24 times sales while management spends on this new therapy for years.
How You Should Play MRNA Stock Now
I would hold my horses, because even the cancer breakthrough doesn't make MRNA stock a solid buy after a triple-digit rally. Much of the obvious good news has already been priced in, and the stock is giving back some of those gains.
There are more catalysts coming. Moderna and Merck are expected to present detailed Phase 3 data at a medical conference, potentially as soon as October, and to discuss regulatory submissions with authorities. A kidney cancer study could also provide another readout. So, while you don't have to wait years for another headline, you still have time for a better entry point.
The actual cancer-drug revenue will still take at least a year, even if Moderna's best-case scenario is right. MRNA's current valuation implies an ambitious $20 billion in annual sales for the cancer vaccine.
As the excitement cools and investors inevitably turn their attention back toward quarterly revenue, losses, and cash burn, I think there is a good chance MRNA offers a better entry point later.
On the date of publication, Omor Ibne Ehsan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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