Moderna shares surged nearly 10% in premarket trading Wednesday after the company settled a long-running dispute over technology behind its COVID-19 vaccine.
The agreement removes a major legal overhang, allowing the biotech firm to shift focus toward its next-generation pipeline, including promising cancer vaccine programs.
Under the settlement, Moderna could pay up to $2.25 billion to a Genevant subsidiary of Roivant Sciences and to Arbutus Biopharma.
Analysts said the payment is lower than earlier fears of more than $3 billion, easing investor concerns surrounding the financial impact.
Citi analyst Geoffrey Meacham noted the resolution should redirect attention toward Moderna’s mRNA-based oncology research, a key area of future growth.
However, Bernstein analyst Courtney Breen warned the payout could reduce Moderna’s cash reserves to around $3.2 billion by 2026.
The company currently expects cash holdings between $4.5 billion and $5 billion this year.
Legal uncertainty remains as Moderna continues its patent dispute with Pfizer and BioNTech, while BioNTech has countersued over Moderna’s new COVID-19 vaccine candidate MNEXSPIKE.
