Moderna shares plunge on plans to cut $1.1 billion in costs, launch 10 new products by 2027

Moderna on Thursday said it plans to cut around $1.1 billion in expenses by 2027 and win approvals for several new products as it charts a path forward after the rapid decline of its Covid business. 

The biotech company said it expects 10 new product approvals through 2027. But Moderna said it will also pause work on some products in its pipeline and scrap others, as it aims to "pace ourselves" in new research and development spending. 

The company aims to trim R&D spending to a range of $3.6 billion to $3.8 billion in 2027, down from an expected $4.8 billion at the end of this year, according to a release.

"You're going to start seeing things come down because there are some studies that we are going to basically sunset and we're not going to start," Moderna CEO Stephane Bancel told CNBC, adding that the company is putting its latent product portfolio "on hold." That refers to a category of viruses that linger inside patients for prolonged periods without causing any symptoms but can reactivate and cause serious health complications later in their lives. 

Still, shares of Moderna fell more than 15% on Thursday.

Leerink Partners analyst Mani Foroohar said in an email Thursday that the company's updates "put to rest key elements of the bull thesis" for its stock and "reflect a worsening financial position."

"R&D reductions are too far out chronologically to be credible from a management team that we think has proven serially unable to project the performance of their business," Foroohar said.

In a research note Thursday, Jefferies analyst Michael Yee said that the bulk of the cost savings won't be achieved until 2027, which "now delays profitability until 2028."

Moderna said it plans to "break even" on an operating cash cost