Moderna reported a narrower first-quarter loss than Wall Street had expected, as the biotech giant’s cost-cutting helped offset a steep decline in its Covid business.

The Cambridge, Massachusetts-based company reported a loss of US$3.07 a share, according to a statement. Analysts were expecting a quarterly loss of US$3.58 a share. 

The company cut costs in various parts of its businesses. Research and development expenses declined 6 per cent in the quarter due largely to the absence of upfront collaboration payments, the company said. Moderna has also reduced its manufacturing footprint as the vaccine maker prepares for a post-pandemic era. It also said it cut use of consultants. 

Quarterly revenues of US$167 million topped analysts’ expectations of about US$100 million – but dropped sharply from the US$1.9 billion in sales posted during the same period a year ago, when Covid vaccine sales were much stronger.  

Moderna reaffirmed its expectations for about US$4 billion in sales this year. The company reported total revenue of about US$6.8 billion last year. 

The quarterly results underscore Moderna’s desire to save money as the pandemic fades and fewer people are getting Covid shots. Most Covid vaccine sales are expected in the second half of the year, before the cold weather virus season.

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In the coming days, Moderna is expected to get US approval for its second product, a vaccine for respiratory syncytial virus, or RSV – which it hopes will help fill the hole left by its shrinking Covid business. The company will compete against two larger and more established competitors, Pfizer and GSK, whose RSV shots hit the market last year. 

Analysts project Moderna’s RSV vaccine will generate about US$356 million in revenue this year.

Moderna said on Thursday (May 2) it had agreed to end a gene editing collaboration with biotech company Metagenomi as it “continues to strategically prioritise its research and development investments.”

The drugmaker aims to develop new uses for its mRNA technology to fight flu, cancer and other ailments. But management faces pressure from investors over its large research budget, which it expects will be about US$4.5 billion this year. The company has projected it will break even in 2026. BLOOMBERG