It is the financial Cinderella Story of the young century. A relatively obscure pharmaceutical company goes from never making a profit, to becoming one of the most profitable research pharmaceutical companies in the new field of messenger RNA. That's Ribo-Nucleic Acid a principal structure in our genetic makeup.
So while you and I have been suffering through the past 2 years of self-quarantine, social distancing, and mask-wearing. Moderna was watching as first it medication, labeled mRNA-1273, and later marketed with the highly suggestive marketing label: Spikevax. Spikevax became one of the three principal medications administered throughout the US and the world.
And put Moderna solidly on the track for profitability for the very first time in its history.
This morning Moderna announced its earnings. Simply put they're phenomenal. Topline revenue for the year came in at $18 billion dollars. That's versus a mere 200 million the year before. A jump of 88% in revenue. It is one of the largest increases I've ever seen. So this is naturally reflected in the earnings per share number which came in at just over $30 per share, versus nearly $2 per share loss the year before. As we noted, 2021 was the first year in Moderna's history that it has turned a profit.
Something that you would expect from a company that is producing one of the most widely distributed medications in history. Making this even more remarkable, Moderna is indicating that they've already pre-sold $19 billion of their Vax for next year. Setting the company up for yet another widely profitable year here in 2022.
So here's the puzzle. One would expect that Moderna stock would literally be priced to the sky. We should for all reasons be seeing one of the biggest rallies of all time. A company that went from losing money, to becoming one of the most profitable companies in the S&P 500 for the past 12 months.
Moderna should be on everyone's leader board, as the runaway momentum play of the year.
But it's not. In fact, it's not even close. Moderna's stock is in trouble. It's at the bottom of the barrel for performance over the past half-year. After hitting a high of nearly $500 per share in August. Moderna stock now trades 75% lower.
Obviously, investors think they know something.
SO, I thought this morning, we might take a look back at this very mysterious stock, and take a brief look into Moderna's history.
Now when the history of our time is written, certainly this chapter of the Covid-19 Pandemic will be central. And one of the main players, will no doubt be Moderna. And although we don't yet know all of the details. Enough is available with a simple internet search to paint an interesting picture.
The origins of Moderna go back to 2005 when a group of Boston-based researchers begins what is essentially genetic research into what will ultimately become an all-new kind of group of gene-based therapies.
Unlike traditional vaccines, which utilize inert components of the disease itself. These new therapies, developed by Moderna, access the human genetic system, instructing the body to in turn fight against the disease, such as Covid-19.
Dating as far back as 2016, Moderna had produced its first patented delivery system, called a nano lipid particle, which would eventually be used to produce their gene therapy. This patent, along with the rest of their research was enough to obtain $110 million in venture capital funding.
Research at Moderna continued, and with the aid of the National Institute of Health, Moderna had 7 major patents, most shared with NIH, on what would become the delivery system for what we call the Covid-19 vaccine. Really gene therapy.
In 2018 Moderna becomes a publicly-traded company raising enough money to see it through its dry spell. Which lasted until just last year.
So those are the facts, as we know them. Right out of the public record. It's a story of the close cooperation between a government agency, the National Institute of Health, various Venture Capitalists, and a group of researchers. Who, before a new disease is even known, the Covid-19 Disease, is already working on a new gene therapy, which will later be used to fight that disease.
Let me now add one more dimension.
There is a growing suspicion among those in the independent scientific community that the real bad element in all this is the spike protein. A biological molecule that, when dispersed throughout the body can produce immeasurable harm.
The Spike Protein, for instance, is believed to be the primary cause of the cardiopulmonary deaths that we're seeing even among the young and healthy. The myocarditis and pericarditis that you may have heard about.
Now it's been assumed for some time that the Spike Protein originated with the Covid-19 Disease. But there is now growing research that suggests that the gene therapy itself may contain a Spike Protein.
That's right the same Covid-19 Vaccine, labeled originally mRNA-1273, but now marketed under the label Spikevax, may indeed contain the harmful Spike Protein itself.
Just why, do you suppose, did Moderna choose the name: Spikevax?
The big economic news this morning, and of course, the big geopolitical move for today is Russia's move into portions of Ukraine. For investors, I expect that we'll see the standard response in times of war and unrest. A retreat to safety.
As equities are sold indiscriminately, safe assets, such as bonds and gold are bought.
Now most interesting to me, will be the reaction in the Cryptos. This is the first time we've really seen the Crypto market reacting to a worldwide crisis.
If I were to guess I would think the major Crypto's such as Etherium and Bitcoin would likely do well, as long as they themselves are not directly threatened. No internet outages or other that would prevent Cryptos from trading or redemption.