Moderna and Pfizer In Talks With U.S. To Make a Bird Flu Vaccine

After the market closed, the Assistant Secretary of Preparedness and Response at the Department of Health and Human Services, Dawn O’Connell, said on a press call that the agency is in conversation with both Moderna and Pfizer about making avian influenza vaccines using messenger RNA-based technology.

“We continue to have active conversations with both manufacturers, and the negotiations are ongoing,” O’Connell said. “We are looking to wrap this up and have something to say very soon.”

Moderna confirmed to Barron’s that the company is in discussions with the federal government about “advancing our pandemic flu candidate.”

Pfizer did not immediately respond to a request for comment.

O’Connell also said that the agency last week had begun the process of converting 4.8 million doses of avian influenza vaccine from bulk product in the government’s stockpile to finished doses ready to be administered.

She said that the filling of the doses would not disrupt the production of seasonal flu vaccines. “It takes a couple of months to be able to fill and finish vaccine doses,” O’Connell said. “So we had these already in hand in bulk, but thought it mades sense, given what we were seeing.”

The Wednesday press call came shortly after the Centers for Disease Control and Prevention announced the second known human case of the virus since it was detected in late March in dairy cattle.

There are no immediate signs that the virus is about to cause a human pandemic, and the Centers for Disease Control and Prevention says that the current public health risk remains slow.

Still, the second human case in the U.S. came amid an ominous drumbeat of news headlines, including a report on Wednesday of Australia’s first-ever human avian flu infection. Investors appear to be looking ahead to a possible avian influenza vaccination campaign.

Moderna, which became a household name in 2020 with its quick work developing a Covid-19 vaccine, hasn’t made any recent announcements on its work on a human avian influenza shot. Last year, the company began early-stage tests of a number of avian flu vaccines that target different strains of the virus.

The stock, however, keeps going up. Moderna shares have climbed 20% just this week, and 45% since the end of last month. In an email to investors midday on Wednesday, Mizuho healthcare equity strategist Jared Holz wrote that new worries over bird flu were having a major impact on vaccine stocks in general, and Moderna in particular.

“MRNA has already gained $20bn in market cap in just the past week alone, we believe in large part to the increased focus on this bird-flu situation,” Holz wrote.

Other vaccine stocks are climbing as well. Shares of

CureVac
,

which, like Moderna, develops messenger RNA-based vaccines, were up 21% on Wednesday. Shares of

Novavax
,

which makes a Covid-19 vaccine, were up 6.3%. Even vaccine stalwarts like

GSK

and

Sanofi

saw their American depositary receipts climb slightly on Wednesday, and Pfizer shares were up 2%.

In response to a question from Barron’s earlier on Wednesday, Moderna confirmed that it is testing a vaccine that targets an avian influenza virus in the same family as the one causing the current outbreak in a continuing Phase 2 study. According to a federal registry of clinical trials, the trial should be completed in July.

The number of dairy farms with confirmed cases of the avian influenza virus known as H5N1 continues to rise, and was up to 51 as of midweek, according to the U.S. Department of Agriculture. Public health officials have long feared H5N1 for its potential to cause a human pandemic, and the unprecedented spread of the virus through these domestic cattle herds has put federal agencies on high alert.

As Barron’s reported in April, the U.S. has had a program in place for roughly two decades to prepare to vaccinate Americans if H5N1 or a similar virus were to begin spreading among humans. That program, however, likely wouldn’t be able to produce enough doses to protect the entire population in a pandemic emergency.

Unlike the 2020 federal government effort to roll out a Covid-19 vaccine, in which the government funded private companies to develop their own shots, the pandemic influenza program is aimed at creating a government shot using components made under contract by multiple manufacturers.

Today, federal stockpiles hold some finished vaccine doses, and building blocks that could be used to make many more. GSK and CSL Seqirus, under contract with the Department of Health and Human Services, are currently testing vaccines that target a strain of H5N1 that is closely related to the one currently circulating in dairy cattle. Sanofi is also involved in the government program.

Federal officials told Barron’s in March that in the event of a pandemic, they would be able to supply 135 million doses over the course of four months. Since the vaccine requires two doses, that would only be enough to inoculate roughly 68 million people in a country of more than 330 million.

O’Connell’s announcement Wednesday indicated that the government has begun to prepare that supply for a potential rollout.

Drugmakers and the government are limited in their ability to begin making H5N1 vaccine doses before a pandemic begins because doing so could threaten the production of the seasonal influenza vaccines, which is done in the same facilities.

Moderna hadn’t been part of the government’s pandemic vaccine stockpile program. it isn’t clear what role the company might play if an avian influenza pandemic were to emerge.

Analysts weren’t convinced by Wednesday’s rally. “We expect shares to retrace today’s gains (barring very unlikely emergence of a H5N1 pandemic) as focus returns to fundamentals,” Leerink Partners analyst Mani Foroohar wrote of Moderna in a Wednesday note.

Write to Josh Nathan-Kazis at josh.nathan-kazis@barrons.com