BioNTech: Between Setback and Hope

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  Christian Ingerl
  Redaktor

The stock of BioNTech is currently on a wild roller-coaster ride. At the end of August, the termination of a study on an mRNA-based colorectal cancer therapy came as a cold shower. But now investors can breathe a sigh of relief: With “Gotistobart,” the Mainz-based company reported promising data for a specific form of lung cancer. The news clearly shows what BioNTech is all about these days: The former star of the COVID-19 vaccine scene is, above all, a bet on the success of a broadly diversified cancer pipeline.

Setback

Back to the news: A personalized mRNA cancer immunotherapy candidate developed in collaboration with Roche subsidiary Genentech has suffered a setback. The drug was evaluated in a Phase II trial involving high-risk patients who had undergone surgical resection of colorectal cancer and had detectable circulating tumor DNA. An independent monitoring committee identified a numerical imbalance in overall survival between the treatment groups and concluded that continuing the trial would likely no longer alter the prospects for success. While this is a major setback, it does not mean the program is completely off the table. Another Phase II trial for pancreatic cancer is still ongoing.

Breakthrough

The latest news on Gotistobart is quite different. The CTLA-4 immunomodulator, developed in collaboration with OncoC4, achieved a median overall survival of 18.5 months in previously treated patients with squamous cell lung carcinoma. Under standard chemotherapy, the median overall survival was only ten months. That is a remarkable difference. Although the data come from the first part of the ongoing Phase 3 PRESERVE-003 study—which is not relevant for regulatory approval—this is not yet enough for a regulatory breakthrough; however, as a clinical milestone, the result is certainly significant.

A competitor demonstrates just how great the potential of mRNA technology in oncology can be Moderna. In August, the company, in collaboration with Merck, reported positive Phase III results for the personalized mRNA cancer candidate Intismeran in combination with Keytruda for high-risk melanoma. The treatment significantly reduced relapses and distant metastases. According to Moderna, if approved, the therapy could reach patients as early as 2027. It would mark the first major commercial breakthrough for a personalized mRNA cancer therapy.

Full Coffers

Financially, BioNTech can afford the costly development work. In the first half of the year, however, revenue nearly halved, dropping from EUR 443.6 million to EUR 223.7 million. At the same time, the net loss widened to EUR 1.35 billion. Research and development costs rose to EUR 1.11 billion. For a biotech company, however, financial breathing room is crucial: As of the end of June, BioNTech had EUR 16.63 billion in cash and cash equivalents.

Nevertheless, the outlook has become more cautious. Due to weaker demand for COVID-19 vaccines and delayed milestone payments, BioNTech now expects revenue of only EUR 1.6 to 1.9 billion in 2026, down from the previously projected EUR 2.0 to 2.3 billion. R&D expenditures are expected to reach EUR 2.0 to 2.3 billion. The company expects to generate a large portion of its annual revenue in the second half of the year, including EUR 613 million from its collaboration with Bristol Myers Squibb. The partnership with Pfizer remains significant: Gross profits from the jointly developed COVID-19 vaccine will be shared outside of Germany.

New Active Ingredients with Potential

BioNTech has no shortage of projects. Most recently, the company was conducting 14 clinical trials relevant to regulatory approval, as well as more than ten novel combination therapies. In addition, there are mRNA cancer immunotherapies and other immunomodulators. The strategic goal is to become a biopharmaceutical company with multiple approved products by 2030. For now, however, the focus is on the World Conference on Lung Cancer (WCLC). At the conference, BioNTech will present key data on well-tested combinations of several novel active ingredients. “Such ‘novel-novel’ combinations are likely to lead to a paradigm shift in the treatment of many advanced diseases,” states Goldman Sachs analyst Asad Haider. The expert sees considerable potential in these combinations.

Investment Solutions

So far, there’s been little sign of this on the stock market. Over the past 12 months, BioNTech’s stock has essentially remained flat. From a technical analysis perspective, things are now getting interesting: The price is currently testing the 100- and 200-day moving averages. If this support zone holds, it could serve as a springboard for another attempt to reach the psychologically important USD 100 mark. Traders can position themselves accordingly. The long mini-future MBNBPV Bank Vontobel currently has a leverage ratio of 7.9, a financing level of $85.64, and a stop-loss level of $90.49. Investors who, on the other hand, expect further declines may want to consider the short mini-future MBNHGT Leonteq is the counterpart. The stop-loss level is set at USD 111.5643, which is just under 13% from the current price.

An alternative for investors who expect the market to move sideways is the Barrier Reverse Convertible recently issued by Swissquote AEEGSQ on BioNTech and Pfizer, recently issued by Swissquote. The product, which trades in dollars, matures at the end of August 2027, has a barrier of 59%, and a coupon of 15.48%. At current levels, the break-even yield to maturity is approximately 14%. The distance to the barrier for the worst-performing stock, BioNTech, is 37.3%.