BioNTech forecasts slump in sales as demand for Covid jab wanes

Covid-19 vaccine maker BioNTech has forecast a sharp decline in sales, underlining the plunging demand for booster doses and the challenge for pharma companies that boomed during the pandemic.

The German biotech company, which produces its vaccine with Pfizer, said on Monday that revenues from Covid vaccines would drop to about €5bn in 2023, from more than €17bn in 2022 and close to €19bn in 2021.

The fall was much worse than market expectations, with analysts forecasting Covid revenues of almost €9bn in 2023, according to Bloomberg data.

BioNTech, whose Covid jab using new messenger RNA technology became the world’s bestselling by revenue, said that adaptations for new variants of the virus would lead to some increased demand. But it also anticipated “fewer primary vaccinations and lowered population-wide levels of boosting”.

Shares in BioNTech fell 3.7 per cent.

However, Jens Holstein, the company’s chief financial officer, predicted that 2023 could be a “trough year” for the Covid market as vaccine producers began to increase prices.

“That won’t happen fully this year because we have a majority of countries that are still under government contracts that are a relic, or a follow-on, from the pandemic,” he told an analyst call.

Holstein said that BioNTech’s revenue-sharing agreement with Pfizer and its low associated costs meant that the Covid vaccine would generate significant income for the company in the years ahead as a commercial market matured. “It could lead to potential for increased volumes and increased prices, but that could take time,” he added.

Rival Moderna — which also uses MRNA for its vaccine — has reported a similar slump in projected revenues, while Novavax, a late-to-market maker of a Covid jab that uses a more traditional technology, this month warned about its ability to continue to do business amid a decline in demand.

Research published in October by the health data analytics group Airfinity said that, while vaccine makers had begun raising prices, this would not fully compensate for the drop in demand for jabs in 2023. It expects 1.6bn Covid vaccine doses to be delivered this year, compared with 3bn in 2022 and 5.7bn in 2021.

The expected revenue plunge highlights the challenges for global pharmaceutical companies that reaped the benefits from the pandemic and must now forge ahead with new products.

BioNTech has been investing in using the technology to treat cancer as it seeks to plough its windfall profits from the pandemic into diversification.

This year it announced it would buy the UK artificial intelligence start-up InstaDeep for as much as £562mn as part of an effort to harness machine learning to improve the process of discovering new drugs. It also unveiled a plan to partner with the UK government to enrol up to 10,000 patients in clinical trials for cutting-edge oncological treatments.

Suzanne van Voorthuizen, analyst at Dutch bank Van Lanschot Kempen, said that BioNTech was entering its “post-pandemic life”, although she was bullish about the company’s future, noting it has more than €20bn in cash.

“They always had a broad pipeline with more than 20 programmes before the pandemic,” she added. “The pandemic caused one programme to leapfrog everything. And it now gives them a source of funding to help deploy the rest of their pipeline.”