U.S. vaccine hesitancy could impact investment
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Illustration: Aïda Amer/Axios
America's retreat from vaccines is likely to reduce venture capital investment in vax startups, and also could cut into the valuations of some private equity-backed clinical research organizations, according to investors in the sector.
Why it matters: Many vaccines save lives and future health-care costs. It's a societal self-own.
Driving the news: Moderna CEO Stéphane Bancel last week told Bloomberg that his company doesn't plan any new infectious disease vaccine studies:
- "You cannot make an ROI if you don't have access to the U.S. market because of delays regulatory-wise, or your market is much smaller because you don't have a recommendation by the government ... There's a lot of vaccines that I think would have huge impact on public health that we're unfortunately not able to take to Phase 3."
State of play: Bancel's comments came just weeks after the Trump administration overhauled the childhood vaccination schedule — dramatically reducing the number of recommended shots — and the same day that the federal vaccine advisory panel's chair questioned the continued need for polio and measles vaccines.
- It's also against the backdrop of skyrocketing measles cases in the U.S., which is at risk of losing its measles "elimination status."
Zoom in: Vaccine developers comprise just a small slice of early-stage biotech investing, but the sector has had some big wins beyond Moderna.
- London-based Vicebio, for example, was acquired last year by Sanofi for $1.6 billion. Affinivax was bought by GSK for $3 billion in 2022, and Vaxcyte went public in 2020 and now has nearly a $7 billion market cap.
- There also are a slew of clinical trial site companies that rely, at least in part, on vaccine study revenue. It's a sector that private equity has been actively consolidating. Same goes for contract manufacturers.
Behind the scenes: Not everyone expects the infectious disease vaccine TAM to shrink, at least not in the long-term.
- Jacob Glanville, founder and CEO of VC-backed Centivax, says that he expects the disruption to be temporary: "As more American children continue to die from measles and other preventable diseases, policy and opinion will shift more in favor...
- "I grew up in a Tzutujil village in Guatemala during a civil war. When the war finally ended in 1996 and village got better access to vaccines and deworming medicine, everyone took them. Because everyone had been living the alternative."
