In Compass Executives’ latest industry insight article, Principal Client Partner Scott Springall has observed that mRNA is the tip of the iceberg in terms of future therapeutic developments; vaccine recruitment; and consequently, investment opportunities.

Understanding mRNA

Messenger ribonucleic acid (mRNA) vaccines are our front-line defence and have shown results, beyond expectation. Being the first of its kind, the Covid vaccines made by German and U.S. Biotech’s (BioNTech founded in 2008 and Moderna in 2010) came from research that has been years in the making.  First coming onto the scene in 1961 – when a global team of scientists cracked the genetic code, tricking the body into making viral proteins triggering an immune response.

Prior to the Covid outbreak, mRNA research was primarily focused on cancer immunotherapy, raising the question of its safety and effectiveness (when aligned to an infectious disease), especially when veering away from the tried and tested process of using monoclonal antibodies (MAb’s).

The financial landscape of mRNA vaccines

According to the latest data from Public Health England and Cambridge University, vaccines have collectively saved up to 95,200 lives in the UK. They have also prevented 82,100 hospitalisations and 23.9 million infections in England alone.

With recent real world data showing evidence of vaccines protection decreasing by:

• Pfizer; 88% after one month and 74% after five to six months
• AstraZeneca; 77% after one month and 67% after four to five months

It’s clear that mRNA vaccines are more effective compared to AZ’s viral vector shot. The Western world is more than willing to pay a premium price to get their hands on them first. Although the AstraZeneca vaccine is less effective, it is much cheaper and will play a huge part in the heavy lifting of vaccinating poorer countries in terms of cost / logistics benefits. This is reflected in the UK’s decision to purchase 35 million more doses of the Pfizer/BioNTech vaccine (delivered from the second half of 2021). Complementing our own British triumph but paying out $682,500,000 for higher efficacy.

The mRNA companies are poised to make billions of dollars (Pfizer $33.5bn / Moderna $19.2bn) in revenue this year, with anxious governments fighting for more booster shots, elevating prices higher. Eager to join the action, GSK and CureVac are hoping for approval of their own mRNA vaccine later this year. Looking at the gap in the market it’s clear that the world needs a reliable vaccine, at a more affordable price. Being the world’s biggest vaccine manufacturer, GSK may be able to strike a balance between the viral vector pricing with the ever-increasing costs presented by U.S. Pharma. Hopefully this will give the whole world access to an affordable mRNA vaccine through utilising GSK’s global manufacturing, distribution, and supply chain capabilities.

What the future holds – an increased investment appetite

 In many ways, mRNA vaccines are just getting started. Only nine months since V-Day, the door has been kicked open and scientific engineers are already exploring new platforms looking to increase immune responses. Examples include HIV, Hepatitis C, Malaria, Tuberculosis, Metabolic Diseases, and many others.

With a positive outlook, we are already seeing Venture Capital and Private Equity firms starting to take note in the next wave of companies. Recently, an mRNA Chinese Biotech (Abogen) raised $700M in their C-series. New mRNA Biotech’s are now getting recognition scaling up from Start-ups to world-changing Biotechs, in a very short time.

The question facing search firms is how, and where, do we find a new generation of mRNA engineers. Quoting Moderna: “mRNA medicines aren’t small molecules, like traditional pharmaceuticals. And they aren’t traditional biologics (recombinant proteins and monoclonal antibodies) – which were the genesis of the biotech industry.”

From experience, I have witnessed a degree of tunnel vision from hiring managers (HMs), often looking for a “like-for-like” candidate, taking vaccinologists from the usual suspects. I expect that with innovation in vaccines now coming from RNA scientists and geneticists from Biotechs, we are about to see HMs expand beyond the realms of the top 5 vaccine pharmaceutical companies and start utilising talent from smaller companies.

This being said, innovation, influence and creativity are clearly coming from the Biotech sector with smaller close working teams. They are able to mobilise far quicker than the 100,000 employee’s juggernauts, known more for bureaucracy and slow processes.

For now, it seems that partnerships between the two are likely to continue, however with Moderna starting via Flagship Pioneering, it is only going to be a matter of time for the UK to see its own start-ups emerging as more VC/PE investors start taking notice.

Being the tip of the iceberg what is next in store, and in five years, what percentage of vaccines will be based on mRNA technology (25/50%)?

We wait with great anticipation.

To find out more, or to enquire about the Life Sciences Practice expertise, please contact Scott Springall on [email protected].

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