German biotech BioNTech said Monday it's trimming drug development costs amid plummeting Covid vaccine sales. In response, BNTX stock tumbled.
BioNTech expects to spend roughly $2.2 billion to $2.4 billion on research and development, down $44 million from its forecast from three months ago. The company also expects to spend less on administrative and capital expenditures this year.
The cost reductions follow a wide miss for second-quarter Covid vaccine sales. During the three months ended June 30, BioNTech generated about $185 million in sales, far below analysts' call for $692.4 million, according to FactSet. Sales plummeted more than 94%.
And for the first time since September 2020, BioNTech reported a per-share loss. On an adjusted basis, BioNTech lost $1.06 per share during the quarter, reversing from a gain of $7.01 a share in the year-ago period. BNTX stock analysts projected a per-share loss of 30 cents.
BioNTech blamed write-offs to partner Pfizer for the profit and sales hits.
On today's stock market, BNTX stock toppled 7.5% to 98.50. Pfizer stock rose 1.9% to close at 35.68.
BNTX Stock: Focusing On Cancer Treatment
As Covid vaccine sales decline across the board — also impacting Pfizer and Moderna — BioNTech says it's focusing on multiple studies in cancer treatment. That includes a final-phase study of a lung cancer treatment in partnership with privately held OncoC4.
BioNTech is also working to launch a Pfizer-partnered Covid booster shot that aims to block the XBB.1.5 subvariant of omicron. It's important to note that strain is no longer dominant in the U.S. From July 23 to Aug. 5, a new strain called EG.5 caused 17.3% of sequenced Covid cases, according to the Centers for Disease Control and Prevention.
Pfizer and Moderna recently told Investor's Business Daily their updated Covid boosters show promise in being able to prevent cases caused by other leading subvariants, including XBB.1.16 and XBB.2.3.
BioNTech kept its sales outlook for the year. The company expects about $5.5 billion in sales. BNTX stock analysts predicted a slightly higher $5.92 billion in sales. BioNTech's prediction suggests sales will accelerate in the back half of 2023. So far this year, the company has generated about $1.54 billion in sales.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
