# Moderna Financial Model

mRNA-based drug platform company using messenger RNA as programmable "software" to instruct cells to produce therapeutic proteins.

- Canonical: https://finamodel.com/startups/moderna
- Excel download: https://finamodel.com/startup-models/moderna.xlsx
- Category: Biotech/Pharma
- Model type: Biotech rNPV
- Funding round: Series G
- Funding: $500M
- Founded: 2017
- Geography: US-headquartered (Cambridge/Norwood, MA); global partners and clinical sites.
- Customer: B2B2C

## About the company

Moderna’s mRNA platform treats messenger RNA as programmable therapeutic software: the coding region changes by drug while common formulation elements can be reused within a modality. This supports rapid development, cell-free manufacturing, and difficult targets across vaccines, oncology, and localised therapies.

Precommercial revenue came from pharma partnership upfronts and technical milestones, reimbursed R&D and clinical milestones, and government grants. Partners included Merck, AstraZeneca, the Gates Foundation, Alexion, and Vertex. The deck does not disclose royalties or consumer product sales, so the model should focus on pipeline and collaboration economics.

By May 2017, Moderna had 12 nominated development candidates and five Phase I trials. Cumulative partnership upfronts and milestones reached $740 million, total cash sources $1.946 billion, and Q1 2017 cash $1.22 billion. The model should forecast programmes, R&D burn, milestones, grants, manufacturing capex, and cash runway.

## What's included

- 5-year monthly revenue build with stage-appropriate growth assumptions
- Full P&L, headcount plan, and operating-expense schedule
- Cash-flow statement, runway, and burn-rate tracking
- Valuation via exit multiple with a DCF cross-check
- Returns analysis with MOIC and IRR
- Unit economics including CAC, LTV, payback, and cohort retention

## Product & value proposition

- Core technology: mRNA is treated as programmable "software of life" - only the coding region (ORF) changes per drug; formulation, 5' and 3' regions are identical across programs within a modality.
- Key advantages over small molecules and biologics: (1) product abundance - hundreds of previously undruggable intracellular and membrane-bound targets; (2) speed - idea to DC nomination in 7–12 months; (3) lower COGS potential - cell-free manufacturing, single manufacturing infrastructure serves entire pipeline.
- Platform generates "modalities" (therapeutic toolkits): Prophylactic Vaccines, Therapeutic Vaccines, Intratumoral I/O, Localized Therapeutics - plus research-stage modalities (Secreted, Liver Intracellular, Lung).
- Research engine: >1,000 novel mRNA deliveries per month; supports parallel multi-arm partner trials.

## Market

- Total pharma/biotech global revenues (2017E): ~$1 trillion for small molecules + biologics combined.
  - Small molecules: $165bn (1994) → $425bn (2004) → $600bn (2014).
  - Biologics: $10bn (1994) → $55bn (2004) → $180bn (2014).
  - Source: Evaluate Ltd., 01-Nov-2016.
- No SAM or SOM figures provided; no mRNA-specific market sizing given.
- Addressable indication breadth illustrated via bubble chart (bubble = market opportunity): prophylactic vaccines (low biology risk), therapeutic/personalized vaccines, intratumoral oncology, localized cardio, secreted therapeutics, liver intracellular, and longer-term CNS/ophthalmology - no dollar figures per segment.
- CMV annual US cost: $2bn (Cannon et al., BMC, 2005).

## Revenue model

Three revenue streams - all B2B / institutional; no consumer product sales:

1. **Partnership upfronts & technical milestones** - large pharma/biotech pays Moderna upfront + milestones for access to modalities/programs. Partners as of May 2017: Merck ($65mm prophylactic vx + $200mm therapeutic vx), AstraZeneca ($370mm intratumoral I/O + localized), Bill & Melinda Gates Foundation ($100mm potential, secreted), Alexion ($100mm, liver intracellular), Vertex ($20mm, lung).
2. **Reimbursement & product milestones** - R&D cost reimbursement and clinical/regulatory milestone payments from partners.
3. **Government grants** - DARPA, BARDA (non-dilutive).

No royalty or commercial revenue stream disclosed; deck is pre-commercialization.

## Traction & metrics

**Pipeline breadth:**
- 12 development candidates (DCs) nominated; 5 in clinical trials (Phase I) as of May 2017; 2 additional INDs opened by FDA; 5 DCs in pre-clinical.
- DC count at year-end: 0 (2012) → 1 (2014) → 7 (2015) → 12 (today).
- Drugs in clinical trials: 0 (2012–2014) → 1 (2015) → 5 (today).

**Financing sources (cumulative through 2016):**
| Line | Founding–2012 | 2013 | 2014 | 2015 | 2016 | Total |
| -- | -- | -- | -- | -- | -- | -- |
| Partnership upfronts & tech milestones | - | $240mm | $100mm | $110mm | $290mm | $740mm |
| Reimbursement & product milestones | - | $2mm | $6mm | $12mm | $36mm | $56mm |
| Equity issuance | $39mm | $110mm | $471mm | $56mm | $474mm | $1,150mm |
| **Total sources of cash** | $39mm | $352mm | $577mm | $178mm | $800mm | **$1,946mm** |
| Potential total grant | - | $22mm | - | - | $225mm | $247mm |
| **Grand total potential** | $39mm | $374mm | $577mm | $178mm | $1,025mm | **$2,193mm** |
| Year-end cash | $22mm | $330mm | $796mm | $802mm | $1,307mm | - |

**Cash position:** $1.22bn at end of Q1 2017; >$200mm of grants available.

**Cash burn / outflows:**
| Line | Founding–2012 | 2013 | 2014 | 2015 | 2016E | 2017E Budget |
| -- | -- | -- | -- | -- | -- | -- |
| R&D | $(8mm) | $(24mm) | $(61mm) | $(124mm) | $(225mm) | - |
| G&A | $(7mm) | $(13mm) | $(18mm) | $(20mm) | $(32mm) | - |
| CapEx | $(2mm) | $(4mm) | $(17mm) | $(28mm) | $(39mm) | - |
| Gross outflows (OpEx + CapEx) | $(17mm) | $(41mm) | $(96mm) | $(172mm) | $(296mm) | >($300mm) |
| Year-end cash | $22mm | $330mm | $796mm | $802mm | $1,307mm | ~$1,000mm |

**Team:** 500 employees, including 300+ scientists and engineers on platform R&D.
**Platform investment:** $100mm annual investment in mRNA platform.

**Clinical data (H10N8 flu vaccine, mRNA-1440):** 100% seroprotection (HAI ≥1:40) in 23/23 subjects at 100µg dose; 87% MN seroprotection; 0% in placebo.

## Competition / moat

- **Moat framing:** platform de-risking (if mRNA works once, it works many times); proprietary integrated platform (chemistry, bioinformatics, mRNA engineering, formulation, process, raw materials).
- **vs. small molecules:** conventional drug discovery increasingly risky (low-hanging targets gone; N=1 per molecule).
- **vs. recombinant biologics:** mRNA can reach intracellular and membrane-bound proteins that biologics cannot.
- No named competitors identified in the deck; competition discussed only in abstract vs. incumbent modalities.
- IP / defensibility: forward-looking statements mention IP enforcement capability; no patent specifics disclosed.

## Team & funding ask / use of funds

- **Team:** 500 people total; 300+ scientists/engineers on platform; industry-leading talent stated as a key asset.
- **Leadership named in deck:** implied Tal Zaks (CMO, named in publication credit on slide 22); Giuseppe Ciaramella (also named in publication); no CEO/CFO slide.
- **Funding ask:** Not explicitly stated (no "Use of Proceeds" slide; no round size or valuation disclosed).
- **Implied use of funds:** sustain $300mm+ annual cash burn (2017E); scale manufacturing (Norwood GMP site); advance 12 DCs through clinic; build platform.
- **Existing investors / grants:** DARPA, BARDA, Bill & Melinda Gates Foundation (non-dilutive). Equity investors not named.

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## Recommended financial model

- **Archetype + why:** Pre-revenue biotech pipeline / cash-burn model with milestone revenue waterfall. Moderna has no product sales; revenue is entirely event-driven (partner milestones, grants). The correct archetype is a **biotech pipeline cash-burn + milestone revenue model** - not a standard 3-statement operating model. Model tracks: (a) milestone payments by program/partner triggered by clinical events, (b) cash runway vs. burn escalation, (c) optionality value of pipeline programs reaching NDA/commercialization in the 5–10 year window.

- **Forecast horizon & granularity:** 2017–2027 (10 years); annual for milestones and burn; semi-annual or quarterly for cash runway to show when next capital raise is needed. 2017E budget is the anchor year.

- **Key drivers & assumptions:**

  *Revenue / Inflows:*
  - R&D reimbursement growth rate: $36mm (2016) → scale with partnership count; assume ~15–20% annual growth
  - Partnership milestone payments per program per stage (IND, Ph I, Ph II, NDA, approval): provides total upfronts by partner but no per-stage breakdown; assume clinical milestone tranches typical for mid-pharma deals ($10–50mm per Ph I readout)
  - New partnership probability and upfront size: 2–3 new partners per year at $50–200mm upfront
  - Grant income: ~$47mm/year average (2016: $225mm was exceptional/BARDA); normalize to $30–50mm/year

  *Outflows / Burn:*
  - R&D spend: $225mm (2016E); 2017E >$300mm gross outflows stated; assume ~$275mm R&D component of that growing 20–25% annually as pipeline expands
  - G&A: $32mm (2016E); grow ~15% annually
  - CapEx: $39mm (2016E); ramp to ~$60–80mm by 2019 for Norwood GMP scale-up, then normalise
  - Net burn: ~($260mm) in 2016; 2017E >($300mm)

  *Cash & Runway:*
  - Starting cash: $1,220mm (Q1 2017)
  - Runway at current burn: ~4 years without additional fundraising
  - Runway toggle: model equity raise triggers (e.g., when cash falls below $500mm floor)

  *Pipeline progression (binary event schedule):*
  - mRNA-1440, mRNA-1851: Phase I ongoing (Dec 2015, May 2016) → Ph II readout assumed 2018–2019
  - mRNA-1325 (Zika): Ph I started Dec 2016 → readout 2018; DARPA/BARDA grant-funded
  - mRNA-1647 (CMV): IND filing 2017 → Ph I start 2017–2018
  - mRNA-4157 (PCV, Merck): IND filed → Ph I 2017–2018
  - mRNA AZD-8601 (VEGF-A, AZ): Ph I started Jan 2017 → readout 2018–2019
  - Assume 1 NDA filing in the 5-year window (most likely mRNA-1647 CMV or mRNA-1325 pandemic vaccine given urgency)

- **Scenarios (Base / Bull / Bear):**
  - *Base:* 2 programs reach Ph II, 1 reaches NDA by 2027; burn grows 20%/year; 1 new equity raise ($500mm) in 2020; year-end cash never falls below $300mm.
  - *Bull:* 4 programs reach Ph II, 2 reach NDA; 2–3 additional major partnership deals ($200mm+ each); IPO 2018–2019 raises $600mm+.
  - *Bear:* 1–2 Phase I failures trigger partner pullback; burn continues; cash runway exhausted by 2021 without additional raise; no NDA before 2028.
  - Key flexed variables: program success rate, partnership upfront size, R&D burn rate, timing to NDA.

- **Required sheets / outputs:**
  1. **Assumptions** - all drivers in one place, toggleable by scenario
  2. **Pipeline tracker** - 12 DCs by program, stage gate, milestone trigger, partner, milestone amount
  3. **P&L / Burn statement** - annual R&D, G&A, CapEx, net cash burn (mirrors slide 37 structure)
  4. **Cash flow & runway** - starting cash, inflows (milestones + grants + equity), outflows, year-end cash; runway in months
  5. **Milestone waterfall** - probability-weighted milestone revenue by program by year (expected value)
  6. **Sensitivity table** - burn rate × milestone timing; runway months as output
  7. **Summary dashboard** - year-end cash, active programs in clinic, cumulative milestones received, runway

## Frequently asked questions

### Is the Moderna financial model free?

Yes. The Moderna model is a free Excel download with live formulas.

### Can I change the assumptions?

Yes. The workbook is editable and its live formulas recalculate when assumptions change.