An administrative court run by the U.S. Patent and Trademark Office has rejected arguments by Moderna that an ABUS Stock patent known as the ‘069 patent should be revoked. The news wiped over $2 billion off the market cap of Moderna and sent ABUS stock flying. ABUS stock closed the day up 119%, yet its $358 million market cap is a fraction of Moderna’s. As we take a closer look at the ruling and the stakes at play, we believe Moderna now has no choice but to purchase ABUS stock.
Moderna was a COVID-19 play that we called early and got our readers and subscribers long at $21 a share. We said at the time:
For investors looking to play the coronavirus outbreak, there’s no better play than NASDAQ:MRNA. With its vaccine entering human clinical trials, expect a major share price spike. There is an urgent need for a vaccine and no other biotech is better positioned that Moderna Inc. Dips are to be bought as NASDAQ:MRNA looks to be significantly undervalued given its enormous potential.
Since then, we have soured on Moderna and focused on identifying small-cap biotechs with bigger potential. We at Insider Financial have nailed quite a few this year, from Inovio to Vaxart to Heat Biologics, and most recently TNXP stock. As we take a closer look, there’s a lot to like with ABUS stock and why further upside is likely.
About ABUS Stock
First up, here’s a little background info for those that aren’t familiar with ABUS stock. Arbutus Biopharma Corporation is a publicly-traded biopharmaceutical company dedicated to discovering, developing, and commercializing a cure for people with chronic hepatitis B virus (HBV) infection. The Company is advancing multiple drug product candidates that may be combined into a potentially curative regimen for chronic HBV infection.
Moderna’s COVID-19 Vaccine Trial
Yesterday’s patent ruling is just the latest issue that has plagued Moderna and called into question its vaccine program. Investors need to keep in mind that Moderna has NO FDA approved drugs. Just take a look at one of the 45 volunteers in Moderna Therapeutics’ coronavirus vaccine trial. Ian Haydon, 29, shared his experience after receiving a coronavirus jab which followed a visit to the urgent care unit, vomiting then passing out, and eventually recovering after a few days. He is one of the four people reported to have experienced severe adverse reactions to the candidate vaccine.
Closely followed investor known as andybiotech on twitter highlighted that Moderna’s publication provided ” 1) No data for the most vulnerable older (>55) population 2) Second dose absolutely necessary 3) Safety profile less than desirable 4) Durability of neutralizing Ab not so encouraging (decline from day 43~57) 5) Very low CD8 T-cell responses”, which adds a bit of caution to the news.
Moderna challenged patents held by Arbutus Biopharma covering lipid nanoparticle, or LNP, technology. Lipid nanoparticles are the delivery system for messenger RNA drugs, including Moderna’s coronavirus vaccine, which is known as mRNA-1273. The ruling could cut into profits on any Moderna drug, including mRNA-1273. The result also opens the door for debate around Moderna’s entire pipeline.
The smart move for Moderna is to buy ABUS stock and end this patent dispute once and for all. The longer it goes on, the worse it is for Moderna and its insiders who have dumped Moderna stock at every opportunity. Moderna insiders have sold more than $200 million in Moderna stock since January. Moderna insiders could have bought all of ABUS stock before the ruling. Moderna can still appeal the patent office ruling to the U.S. Court of Appeals for the Federal Circuit. That court, however, often upholds the patent office’s determinations.
This is not the first time Moderna has lost to Arbutus. In 2018, Moderna and Arbutus reached a settlement granting ABUS stock a share of milestone and royalty payments from Moderna. In order for messenger RNA to work, it must be delivered into a patient’s cells. The technology developed by Arbutus called lipid nanoparticles, or LNPs is designed to do exactly that. As a result, the smart and only move for Moderna is to purchase Arbutus Biopharma, which has backed Moderna into a corner and there’s no other move the company can make.
The stakes for Moderna are too high – in the tens of billions of dollars to hundreds of billions of dollars potentially. Even if it costs Moderna $1 billion to buy ABUS stock, it will be worth it.
As always, good luck to all (except the shorts)!
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Disclosure: We have no position in NASDAQ:HTBX or any of the securities mentioned. We wrote this article ourselves and it expresses our own opinions. We are not receiving compensation for it. We have no business relationship with any company whose stock is mentioned in this article.
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