The extent of the rollout will determine how much manufacturers stand to benefit.
Late Thursday , U.S. health officials endorsed booster shots for the Pfizer vaccine to all Americans 65+ -- as well as tens of million younger people at greater risk due to their health or jobs.
Officials called the move a first step. In the weeks and months ahead, boosters will be available in greater numbers. This includes boosters for vaccines manufactured by Moderna or Johnson & Johnson. This, along with continued growth in the number of initial vaccinations could lead to a significant increase in sales and profits for Moderna and Pfizer.
Michael Yee, a Jefferies analyst, stated that "the opportunity quite frankly is reflective the billions of people all around the globe who would need to get a vaccine and a boost."
Wall Street is paying attention. Since President Joe Biden's booster plan was announced in mid-August, the average analyst forecast for Moderna’s 2022 revenue has increased 35%.
Pfizer has been responsible for most of the U.S. vaccinations. It developed the shot using Moderna and BioNTech in Germany. They have vaccinated about 99 million and 668 million people. Johnson & Johnson ranks third, with approximately 14 million people.
It is unknown how many people will receive the extra shots. Morningstar analyst Karen Andersen, however, expects boosters to generate around $26 billion in global sales for Pfizer or BioNTech next year and about $14 billion for Moderna if they're endorsed for almost all Americans.
These companies may also be able to gain business from those who have received other vaccines. Britain plans to offer boosters for people over 50, and those with other health issues. A panel of experts recommended that Pfizer's shot should be the first choice and Moderna the second.
Andersen anticipates Moderna to make a profit of approximately $13 billion next year, as it has no other products, if all COVID-19 vaccinations are widely authorized.
Pfizer's potential vaccine profits are difficult to predict, but executives at the company have stated that they expect their adjusted pre-tax profit margin from vaccine to be in high 20s as a percentage revenue. Based on Andersen’s sales forecast, that would mean a profit of approximately $7 billion next year from boosters.
J&J and Europe’s AstraZeneca both stated that they do not intend to make a profit from the COVID-19 vaccines in the event of a pandemic.
Moderna and Pfizer believe that boosters will be more profitable than original doses, as they don't have to incur the same research and development expenses.
