BioNTech forecasts slump in revenues as demand for Covid jab wanes

Vaccine maker BioNTech has forecast a worse than expected slump in revenues this year as demand for coronavirus immunisation wanes, underlining the scale of the challenge facing companies that enjoyed windfalls from the pandemic. 

The German biotech company, Pfizer’s partner for the Covid-19 vaccine, said on Monday that revenues from Covid vaccines would drop to about €5bn in 2023. That compares with total revenues of more than €17bn in 2022 and €19bn the year before that, the vast majority of them generated by coronavirus jabs. 

The drop was worse than market expectations, with analysts forecasting total revenues of almost €8bn in 2023, according to Bloomberg data. 

BioNTech, which partnered with US pharmaceutical group Pfizer to develop a Covid jab that became the world’s bestselling by revenue, said that adaptations for new Covid variants would lead to some increased demand. But it also anticipated “fewer primary vaccinations and lowered population-wide levels of boosting”.

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. Yet their arrival on the market may not come soon enough to cushion the loss in revenue.

Rival Moderna — which uses messenger RNA 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.

BioNTech, whose messenger RNA helped it rocket to international fame during the pandemic, has been funnelling money into 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.

Jens Holstein, the company’s chief financial officer, said that BioNTech’s strong performance in 2022 would “provide a springboard to accelerate and build upon” a diversified pipeline of drugs and fund research and development in the years ahead. 

He said that, although Covid vaccines would generate lower revenues, they would remain a significant source of revenue, adding that the company would continue to invest in R&D as well as mergers, acquisitions and collaborations.

Its partner Pfizer, flush with the cash it reaped during the pandemic, this month announced it would buy biotech company Seagen for $43bn — the biggest healthcare deal on record since AbbVie bought Allergan for $63bn in 2019.