Moderna said Friday it's suing Pfizer and BioNTech for patent infringement, claiming the duo copied its messenger RNA technology to make Covid vaccine Comirnaty. In response, all three vaccine stocks fell.
The suit alleges Comirnaty infringes on patents Moderna filed from 2010 to 2016 covering messenger RNA, or mRNA, technology. That tech tells the body to make a single spike protein, prompting an immune response.
Moderna Chief Executive Stephane Bancel said the company invested billions of dollars to develop and patent its platform in the decade before the pandemic hit.
"This foundational platform, which we began building in 2010, along with our patented work on coronaviruses in 2015 and 2016, enabled us to produce a safe and highly effective Covid-19 vaccine in record time after the pandemic struck," he said in a written statement.
Vaccine Stocks: Moderna Expects Compensation
On the stock market today, vaccine stocks broadly dipped. BioNTech stock toppled 4% to 142.60. Pfizer stock lost 2.3% and closed at 46.82. And Moderna shares skidded 3.8% to 136.70.
Moderna says it pledged not to enforce its patents during the pandemic. In March 2022, the company updated its pledge, saying it wouldn't wage patent battles in 92 low- and middle-income countries.
"Moderna expected companies such as Pfizer and BioNTech to respect its intellectual property rights and would consider a commercially reasonable license should they request one for other markets," the company said in its news release. "Pfizer and BioNTech have failed to do so."
Now, Moderna says it expects Pfizer and BioNTech to compensate it for Comirnaty sales outside the 92 countries in the COVAX Advance Market Commitment. The coalition focuses on equitable vaccine distribution.
'De Facto' End Of Pandemic
SVB Securities analyst Mani Foroohar notes Moderna's lawsuit is "part of a complex web of litigation across various companies. Moderna is being sued for patent infringement by Arbutus Biopharma and Alnylam Pharmaceuticals.
Both allege Moderna's Covid vaccine, Spikevax, uses their delivery mechanism. These fatty droplets called lipid nanoparticles, or LNPs, protect the RNA instructions until they arrive at the right cellular spot in the body.
Foroohar has an underperform rating on Moderna stock. He doesn't expect a near-term impact on the vaccine stocks.
"While we expect this dispute to take years to resolve in court, minimizing stock impact in the short-term, this is a de facto recognition of the end of the Covid-19 pandemic by Moderna, as the company previously signaled reluctance to pursue patent litigation while the pandemic was ongoing," he said in a note to clients.
Pfizer, BioNTech Plan Their Defense
Pfizer said it hadn't yet received the complaint.
"But we are surprised by the litigation given the Pfizer/BioNTech Covid-19 vaccine was based on BioNTech's proprietary mRNA technology and developed by both BioNTech and Pfizer," the company said in an emailed statement. "We remain confident in our intellectual property supporting the Pfizer/BioNTech vaccine and will rigorously defend against the allegations of the lawsuit."
BioNTech launched in 2008, two years before Moderna. Moderna beat BioNTech to the public market, however, holding its initial public offering in late 2018. BioNTech followed about a year later.
The German drugmaker said its work is original and it plans to "vigorously defend against all allegations of patent infringement."
"BioNTech also values and respects valid and enforceable intellectual property rights of others and remains confident in its intellectual property," the company said in a written statement. "It is an unfortunate but rather regular occurrence that other companies make allegations that a successful product potentially infringes their intellectual property rights, even more so here after witnessing the historic accomplishments of a vaccine like Comirnaty."
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
