Moderna is making headlines again, but this time it’s not just for its unexpected first-quarter profits. Despite raking in billions of dollars in revenue, the company is still planning to hike the price of its COVID-19 vaccines by a whopping 400 percent.
Financial analysts were shocked when Moderna reported $1.86 billion in revenue and a small profit of 19 cents per share, far exceeding their expectations. But the company’s success hasn’t changed its plans to charge exorbitant prices for its life-saving vaccines.
During an earnings call, Moderna’s Chief Commercial Officer confirmed that the company is moving forward with its price hike as the vaccines transition from federal distribution to the commercial market. The updated vaccines are expected to cost between $110 to $130 per dose.
This news has sparked outrage among lawmakers, who point out that Moderna developed the vaccine in collaboration with government scientists at the National Institutes of Health and received billions of dollars in federal funding. Senator Bernie Sanders called out Moderna’s CEO for profiting off the pandemic, with his salary increasing by 50 percent to $1.5 million and exercising stock options worth nearly $393 million.
Moderna’s pay and governance have raised eyebrows among financial analysts, with board members’ pay ranking in the top 25 percent of directors at America’s top 500 largest publicly traded companies. It’s clear that Moderna’s success has come at a steep cost, and it remains to be seen how the public will react to its price hike.
The highly anticipated Moderna vaccine has experienced unexpected financial success, even before the company raised its prices. Reports state that Moderna earned $4.5 billion for the full-year 2021, which has far exceeded the projected profits. This is despite the fact that in early March, Moderna announced a 400% increase in vaccine prices.
The Moderna vaccine has been widely hailed as one of the most effective treatments against the novel COVID-19 virus. This combined with the massive demand for vaccinations worldwide has proved to be hugely beneficial for Moderna’s revenues. The company announced its 2021 earnings of $4.5 billion, which was a jump of 270% compared to 2020. Furthermore, the $4.5 billion figure also surpassed analyst’s predictions of approximately $4 billion.
The company attributed a large part of its success to the fact that it was one of the first companies to have developed a working vaccine against the novel virus. Moderna began the process of distributing its vaccine to the public in February 2021. In the US, the company is currently supplying over 50 million doses of the vaccine each month to both private and public entities, with even higher demand in many other countries all around the world.
Just a few weeks after announcing its 2021 financials, Moderna also announced that it was increasing the prices of its vaccine four-fold, bringing the average cost per dose to $18. In spite of the massive price-hike, Moderna has reported that demand has remained strong and the company is still seeing profits.
It appears that Moderna has been able to enjoy skyrocketing revenues on the global stage by taking advantage of the massive demand for effective drug solutions to the novel virus. The company’s unexpected financial success and global recognition only further emphasise the need for rapid-action solutions to such future emerging epidemics in order to minimise the economic, financial and social impact.
