Moderna Pricing Spineometer: 3 of 5 Vertebrae

Moderna, a leader in mRNA medicine best known for its COVID vaccine, had a mixed FY 2024. Revenue fell 53% to $3.2 billion, and operating losses rose 7% to $3.9 billion over last year.

A review of Moderna’s earnings calls and associated financial reports provided insight regarding the importance of pricing on performance.

FACTS FROM EARNINGS CALLS AND ANNUAL REPORT

In their Q4 2024 Earnings Call on 14 February 2025, Stephen Hoge, President, understandably avoided direct questions regarding price negotiations with different agencies. A similar stance was taken by James Mock, CEO, during their Q2 2025 Earnings Call on 1 August 2025.

Moderna currently has over 35 mRNA formularies under development. Moderna is targeting four disease areas: Respiratory Viruses, Latent and Other Viruses, Oncology, and Rare Diseases.

99% of its current revenue is derived from mRNA COVID vaccines. Their second commercial offering, a Respiratory Syncytial Virus (RSV) vaccine, was approved by the FDA only in May 2024 and constituted the balance of revenue.

Roughly 50% of Moderna’s revenue in 2024 was earned in the U.S., 20% in the E.U., and 30% in the Rest of World.

Currently, Moderna is operating at a loss and has been operating at a loss since its inception in 2010. Investors would consider it a growth stock.

VALUE-BASED PRICING FRAMEWORK IMPLIED PRICING REQUIREMENTS

Of the 5,800 employees at Moderna, industry benchmarks would suggest 7 to 35 professionals would manage pricing decisions daily. Moderna has similar pricing requirements to many other businesses, but due to their high investment in research and development and the rapid evolution of their industry, we would recommend the pricing team towards the upper end of this industry benchmark, in the range of 25 to 35.

1. Moderna spent $4.5 billion on Research and Development, or 140% of revenue. These efforts require intense and focused pricing research. For instance, consider the pricing of a new vaccine for Epstein-Barr. Epstein-Barr virus impacts roughly 90% of Americans by adulthood, can debilitate patients for weeks to months, and can lead to hospitalization. They are developing two vaccine candidates, one of which has entered phase 1 trials. Pricing such a novel vaccine would benefit from an in-depth study of the Economic Value to the Customer, quantifying the value of improved productivity, anticipated savings costs from avoided hospitalization, and other benefits. This would require not only HEOR (Healthcare Economics and Outcome Research), but also the translation of the value created for patients into a price that enables Moderna to capture its fair share of the value created for customers. It would also require an estimate of volumes that would be captured at various prices. The research and development effort to develop a new mRNA solution will take years to complete. This implies a need for pricing early in the new product development (NPD) effort to quantify the business case for pursuing a solution, and later in the NPD cycle, but amply before launch, to update and solidify go-to-market pricing.
2. Once commercialized, Moderna would need to negotiate prices with multiple insurers, government agencies, governments, and likely market intermediaries like Pharmacy Benefit Managers, to engage their market. Each will seek a different invoice price or rebate amount. Managing price variances and supporting sales teams with solid price guidance developed from statistical analysis and solid quantifiable arguments would be another key role for pricing to engage.
3. Moderna cites rapidly advancing technologies and intense competition in the biotechnology and pharmaceutical industries. Academic research has demonstrated that companies in industries undergoing rapid evolution benefit from greater collaboration and diligence regarding pricing decisions. This would increase the benefits of a strong pricing capability.
4. Moderna operates across the globe. Each country has different commercial practices and presents a different competitive environment. Best practices would suggest collocating pricing expertise in significant regions and markets to manage the variation in industry dynamics.
5. Changes undertaken by Robert F. Kennedy Jr. as Secretary of Health and Human Services have introduced vaccine skepticism into medical decision-making at the Centers for Disease Control. These exogenous governmental factors negatively impact Moderna’s commercialization opportunities. Beyond lobbyists, Moderna would benefit from applied economic theory to anticipate the impact on pricing and quantity sold.

OBSERVED PRICING CAPABILITY

Research into the investment by Moderna in pricing yielded encouraging results.

1. The pricing team size is in the lower end of industry standards, not the upper end as would be warranted.
2. Team roles include Lead, Principal, Sr. Director, and Executive Director.
3. Responsibilities included Pricing and Contracting, Market Access and Pricing, Specific Disease Category Pricing, Value Access, Economics and Epidemiology.
4. Pricing experts are located in the United States. None were identified outside of the U.S.

Given the importance and capability of pricing at Moderna as indicated in financial reports, management statements, and our pricing team research, we have come to the following conclusion as of September 2025.

Moderna Pricing Spineometer: 3 out of 5 Vertebrae. Given the rapid evolution of their industry and the pressure for revenue growth, we anticipate there are significant gaps in pricing capability. These gaps can be filled, and their pricing team is off to a strong foundation, but further investment is warranted.

MRNA (Moderna, Inc.) rose from 32 the day prior to their earnings call to 35 one week later after their Q4 2024 earnings call. FY 2024 revenue of $3.2 billion with a -122% operating margin.

For FY 2024, a 1% improvement in price for Moderna would yield a 1% improvement in operating profits, holding all else constant at Moderna.