Biotech
Thursday, April 11th, 2024 8:05 pm EDT
Key Points
- Moderna has paused plans to build a vaccine-manufacturing site in Kenya due to a steep drop in demand for its Covid vaccines, with no vaccine orders for Africa since 2022 and significant losses incurred.
- This decision is part of Moderna’s broader effort to cut costs by resizing its Covid vaccine manufacturing operations, reflecting a global decline in demand for protective vaccines and treatments against the virus.
- Despite the setback, Moderna remains committed to ensuring equitable access to Covid vaccines for African nations through its global manufacturing network and is actively working on developing vaccines for diseases like HIV and malaria, although these efforts are still in early stages.
Moderna, a biotech company, has halted its plans to construct a vaccine-manufacturing facility in Kenya due to a significant decrease in demand for its Covid vaccines. Since 2022, the company hasn’t received any vaccine orders from Africa, resulting in over $1 billion in losses and write-downs associated with the cancellation of previous orders from the continent. This decision by Moderna reflects its broader strategy to reduce costs by resizing its Covid vaccine manufacturing operations, responding to dwindling global demand as people rely less on protective vaccines and treatments against the virus. Although Moderna’s shares experienced a 45% decline last year, they have seen a slight uptick of around 6% this year. Initially, in March 2022, Moderna announced a $500 million investment in the Kenyan site, intending to supply up to 500 million doses of its mRNA vaccines to Africa annually, with plans to commence filling doses as early as 2023. However, the company has concluded that the demand in Africa does not justify the viability of the planned factory in Kenya. Nevertheless, Moderna asserts its commitment to ensuring equitable access and meeting emerging demands from African nations through its global manufacturing network. Additionally, Moderna is actively working on developing vaccines for diseases prevalent on the African continent, such as HIV and malaria, as part of its broader initiative to expand access to vaccines that are currently out of reach for many. However, these vaccines are still in the early stages of development. In light of these factors and in alignment with its strategic planning, Moderna believes it prudent to pause its efforts to build an mRNA manufacturing facility in Kenya, allowing the company to better align its infrastructure investments with the evolving healthcare needs and vaccine demand in Africa.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/04/11/moderna-halts-kenya-vaccine-plant-plans-as-covid-shot-demand-plunges.html
