Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
BioNTech has slashed about €1bn from its full-year revenue forecasts on the back of falling demand for its Covid-19 vaccine developed with Pfizer.
The German biotech now expects revenue from Covid shots of about €4bn in 2023, down from its guidance of €5bn, issued in March.
However, the company revised down its estimate for a write-off related to raw materials purchased during the pandemic to make vaccines. It now expects a write-off of about €600mn, down from the up to €900mn it flagged last month, as it concluded some of the charges had already been reflected in last year’s accounts.
The update comes as Covid vaccine makers have scaled back their expectations for vaccine sales in recent weeks, and investors have grown wary about unpredictable demand for jabs.
Jens Holstein, chief financial officer of BioNTech, said the company had reduced costs for 2023 in line with the lower than expected revenue.
“In the third quarter, we continued to invest in our capabilities and our portfolio of innovative product candidates while strengthening the financial position of BioNTech. About €17bn in cash and security investments provide strategic flexibility and is a major strength, especially in these days, where financial stability is key,” he said.
BioNTech now expects to spend between €1.8bn and €2bn on research and development this year, compared with its previous guidance of between €2.4bn to €2.6bn. It has also cut the top end of its expectations for capital expenditure by half, and reduced forecasts for sales, general and administrative expenses by up to €100mn.
BioNTech’s update comes after Pfizer cut its forecasts for the Covid vaccine last month, and rival Moderna said last week that it expected sales at the low end of its guidance, as fewer people line up to have booster shots this autumn. BioNTech said it anticipated fewer first doses and lower boosting compared with previous years. But it also added that the revenue cut was partly the result of later than anticipated regulatory approvals, which delayed national vaccination programmes and pushed expected sales into future periods.
In the third quarter, BioNTech beat expectations to report diluted earnings of 67 cents per share, higher than the consensus forecast for a loss of 35 cents per share. Net profit fell more than 90 per cent to €160.6mn from the same period the year before.
Sales were €895.3mn in the quarter, slightly above the average analyst estimate for €865.8mn, but far lower than the €3.5bn in the third quarter last year.
BioNTech is investing its Covid vaccine windfall in innovative oncology treatments, many of which are in early stage trials and will not reach the market for several years.
Uğur Şahin, BioNTech’s chief executive, said the company had recently added antibody drug conjugates, one of a newly popular drug class that aims to be more targeted than chemotherapy.
“Our strategy focuses on assembling a diverse toolbox of complementary technologies to deliver novel therapies, aiming to improve the standard of care for cancer patients,” he said. “We combine our internal innovation engine with a high-performance partnership model to transform healthcare and improve patients’ quality of life.”
Read the full article here