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US signs agreement to pay Moderna $1.5 billion for 100 million doses of vaccine

The US government wants first access to the vaccine for its citizens. The payment includes delivery of 100 million doses and incentive payments for timely delivery of the product.
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Moderna, Inc., a biotechnology company that was the first one to use messenger RNA (mRNA) to create a new generation of transformative medicines for patients, has signed an agreement worth $1.525 billion with the U.S. government to supply 100 million doses of mRNA-1273 vaccine.

The US government wants first access to the vaccine for its citizens. The more than billion dollars is for the manufacturing and delivery of 100 million doses, including incentive payments for timely delivery of the product.

The US government has already awarded $955 million through the Biomedical Advanced Research and Development Authority (BARDA) for the development of mRNA-1273 to the company and the latest announcement brings the government's commitments for early access to mRNA-1273 to up to $2.48 billion.

Moderna Therapeutics Coronavirus COVID vaccine

These payments are being given under the Operation Warp Speed. The government will also have the option to purchase up to an additional 400 million doses of mRNA-1273 from Moderna.

These vaccines will be delivered to the US citizens free of cost, but healthcare professionals could charge for the cost of administering the vaccine. The United States has entered into similar deals with other companies too. It has advanced purchase agreements with Johnson & Johnson, AstraZeneca Plc, Pfizer Inc and BioNTech SE, and Sanofi SA and GlaxoSmithKline Plc for their respective vaccine candidates. The agreements lock in more than 500 million doses of COVID-19 vaccine for the country. Some others like Japan, the United Kingdom, and Germany have entered into similar agreements with various companies who are in the third phase of clinical trials.

All this is incumbent on the vaccines getting health regulatory approvals from respective bodies.

Moderna's price per dose comes to around $30.50 per person for a two-dose regimen. With the exception of its (US) deal with AstraZeneca, all the deals price COVID-19 vaccines between $20 to $42 for a two-dose course of treatment.

“We appreciate the confidence of the U.S. government in our mRNA vaccine platform and the continued support,” said Stéphane Bancel, Moderna’s Chief Executive Officer. “We are advancing the clinical development of mRNA-1273 with the ongoing Phase 3 study being conducted in collaboration with NIAID and BARDA. In parallel, we are scaling up our manufacturing capability with our strategic partners, Lonza, Catalent and Rovi, to address this global health emergency with a safe and effective vaccine.”

“For Operation Warp Speed, we are assembling a broad portfolio of vaccines to increase the odds that we will have at least one safe, effective vaccine as soon as the end of this year,” said HHS Secretary Alex Azar. “With this latest investment, we will have supported the vaccine candidate developed by Moderna in partnership with the NIH all the way from early development through clinical trials and now manufacturing, with the potential to bring millions of safe and effective doses to the American people.”

Moderna's deal with the US only pays out in full if the drugmaker hits certain unspecific timing benchmarks for vaccine delivery.

Moderna has been involved in the development of the proprietary platform of the new class of mRNA-based vaccines since the last nine years. This investment in research has resulted in Moderna being able to create, manufacture expeditiously, and clinically develop mRNA-1273 to address the current COVID-19 pandemic potentially.

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