Today we're going to talk about the world's leading mRNA platform biotechnology company--$BioNTech (BNTX.US) $。

The focus of this article

1. Increase the African market and get a big order from the US government

2. the stock price fell during the year, what else is there to see except COVID-19 vaccine

On October 10, 2019, BioNTech from Mainz, Germany, landed on NASDAQ.$Moderna Inc (MRNA.US) $Then another listed mRNA biotechnology company. After opening 10 per cent higher, BioNTech's shares finally stopped at $14.24 on its first day of trading. At that time, no one would have thought that this obscure small company became famous by COVID-19 vaccine, and its value doubled.

On Aug. 10 last year, the company's share price hit an all-time high, rising to $457.93 in intraday trading and rising 2610% from its offering price.

1、Increase the size of the African market and get a big order from the US government

On May 8, the company announced the financial results of Q1 in 2022. The financial report showsThe company's first-quarter revenue was 6.375 billion euros, compared with 2.048 billion euros in the same period last year, an increase of 211% over the same period last year. Net profit was 3.699 billion euros, compared with 1.128 billion euros in the same period last year, an increase of 228%.Diluted earnings per share were 14.24 euros, compared with 4.39 euros a year earlier.

COVID-19 VaccineThe company and Pfizer Inc have delivered 750 million doses of BNT162b2 vaccine.. By the end of April 2022, the two companies have signedThe order for COVID-19 vaccine delivered in 2022 is 2.4 billion doses.It is planned to provide more than 2 billion doses of COVID-19 vaccine to low-and middle-income countries by the end of 2022.

1.1 leading COVID-19 vaccine market share

According to ourworldindata.org, the vaccine Pfizer Inc collaborated with BioNTech is the most widely used vaccine in the European Union and the United States.. As of March 28, 2022, 59% and 72% of the vaccines used in the United States and the European Union were co-produced by the two companies, respectively. In addition, vaccines cooperated by the two companies account for 61 per cent (74 million doses) and 95 per cent (87 million doses) of the vaccine market in South Korea and Japan.

1.2 Construction Company's first mRNA Vaccine production Base in Africa

On June 23, the company began construction of its first African mRNA vaccine production base in Rwanda. The company expects that the first mobile vaccine production facility, BioNTainer (pictured below, a mobile mRNA vaccine manufacturing facility based on a container solution), will be delivered by the end of 2022. More factories are expected to be built in Senegal and South Africa.It is estimated that up to 50 million doses of COVID-19 vaccine can be provided each year.BioNTainer will be equipped to produce a range of mRNA-based vaccines to meet the needs of African Union member States, such as COVID-19 and malaria and tuberculosis vaccines being developed by the company.

1.3 received another US $3.2 billion COVID-19 vaccine order from the US government

On June 29th, the company announced that the US government had agreed to pay vaccine partners Pfizer Inc and BioNTech $3.2 billion for 105 million doses of COVID-19 vaccine. The deal will provide vaccines for adults, children and infants, and may include some vaccines against variants of Omicron. Delivery plans begin as early as the end of summer and continue into the fourth quarter.

Under the agreement, the US government also has the option to purchase an additional 195 million doses of COVID-19 vaccine from Pfizer Inc and BioNTech.Brought the potential vaccine supply to 300 million doses.. At a price of $3.2 billion, the average price of each dose of vaccine is about $30.50, compared with the initial agreement reached between Pfizer Inc and the government two years ago of 100 million doses and a price of $19.50 per dose.By contrast, the purchase price of each dose of vaccine has increased by more than 50%.

2. When the stock price fell during the year, what else is there to see except COVID-19 vaccine?

As of June 28, the company's shares have fallen by about 43% since the start of the year. Although the company is now in COVID-19 vaccine leading industry, making a lot of money from it.However, with the improvement of the epidemic and the end of the large-scale government-funded vaccination, the company's COVID-19 vaccine sales will gradually decline every quarter in the future.. Without COVID-19 vaccine, does the company have any other business that can stop the share price from falling and raise its valuation again?

2.1 the certainty of non-COVID-19 vaccine business needs to be evaluated

BioNTech's R & D pipelines are basically in the early stages, and there are no products with high certainty that can produce more than $1 billion a year in the next 3-5 years. CompanyThe goal is to bring a variety of new products in the field of oncology and infectious diseases to market in the next 3-5 years.。

In oncology, the company currently has 16 projects and 20 clinical trials, including 5 randomized phase II trials. In the area of infectious diseases, there is an ongoing phase I project and more than 10 preclinical projects, four of which are expected to go into clinical use this year. These II drug candidates are in important large markets, such as lung cancer (NSCLC), melanoma or colorectal cancer.

The company will launch human trials of vaccines against herpes zoster, tuberculosis and malaria in the second half of this year. In addition, the company is accelerating the expansion of the platform to new treatment areas, such as autoimmune diseases, regenerative medicine and cardiovascular diseases, and is expected to select key candidates for several projects.

Moderna Inc, who is also involved in mRNA technology, claims to be developing seven "treatment models" of drugs, including autoimmune, cardiovascular and regenerative medicine. However, progress has been slow and there has not been much noteworthy progress, which may not bode well for BioNTech, because they all use the same biotechnology.

In terms of infectious diseases, Moderna Inc has gone a long way, and CMV, RSV and influenza vaccines are entering critical trials. However, these markets have been$GlaxoSmithKline PLC (GSK.US) $和$Sanofi SA (SNY.US) $And other vaccine giants compete, so there is no guarantee that the mRNA method is the most effective.

In view of this, the possibility of effective competition of BioNTech in the vaccine market other than COVID-19 vaccine needs to be evaluated.

2.2 Cash flow is abundant and valuation is more reasonable than that of peers

According to 22Q1, the company currently has $6 billion in cash and cash equivalents, plus 12.6 billion of revenue, equivalent to more than 18 billion of purchasing power. In order to prevent the subsequent revenue decline from being too serious, BioNTech needs to acquire some commercial products now and start investing in assets that will generate stable cash flow in the future.The current purchasing power of $18 billion is enough to acquire some promising biotech companies.。

Compare with peers$Gilead Sciences Inc (GILD.US) $、$Moderna Inc (MRNA.US) $、$Bojian Company (BIIB.US) $，The data show that BioNTech's valuation is relatively reasonable. The company's price-to-earnings ratio is 3.95 times, well below the peer average of 6.95 times. In addition, the company's EV/EBITDA is 3.73x, compared with an average of 6.34x for its peers.EV/EBITDA, also known as enterprise value multiple, is a widely used corporate valuation index, similar to the price-to-earnings ratio valuation method, the lower the value, the cheaper the company. EV is the value of the company, EV= market value + total liabilities-total cash = market value + net liabilities; EBITDA is profit before interest, tax, depreciation and amortization. )

Investment vaccine companies need to track the progress of the company's R & D pipeline for a long time, which is a factor strongly related to the company's valuation. If the company can achieve the same success in oncology as COVID-19 vaccine, then at the current valuation, it is definitely an eye-catching buying point. However, since success in the non-COVID-19 area is far from guaranteed, it is too early to give any commercial value to potential products under development. Coupled with the decline of COVID-19 vaccine revenue in the future, there is also a certain risk in the current valuation of the company.