Biotech company Moderna, which is among the leaders in the race to develop a coronavirus vaccine, on Thursday named a sector veteran its new finance chief, as it gears up to launch commercial operations and potentially oversee explosive growth if it releases a successful treatment.
The Cambridge, Massachusetts-based company said David Meline will assume the post of CFO June 8. Meline will arrive at Moderna from drugmaker Amgen, where he was the top financial executive between 2014 and 2019, according to press statements. Before Amgen, Meline filled the CFO position for industrial conglomerate 3M.
Meline brings with him strong international and commercial experience, said Ray Jordan, head of corporate affairs for Moderna. During his time at Amgen, Meline also demonstrated the ability to maintain fiscal discipline even in the face of robust growth, Jordan added. “He took on some financial transformation projects at Amgen even as Amgen was growing,” Jordan said to Forbes.
Meline joins Moderna at a time when the company, which is vying to pioneer a treatment for the virus that causes Covid-19, is preparing to pivot from a purely developmental phase to building commercial operations. The company currently has nine vaccines in the pipeline. “As we prepare for the phase three studies of our SARS-CoV-2 vaccine and our CMV vaccine, we are entering another critical phase for the company,” said Stéphane Bancel, chief executive officer of Moderna in a media statement. “We have started to build commercial capabilities and started to set up commercial subsidiaries in several countries.”
Investors also see Moderna’s potential. Share prices for the company have soared 209% over the last 12 months, according to FactSet. “I look forward to joining the Moderna team to help the company enter this new phase of growth and assist the full build out of its business model, including positive impact on large populations and entry into new geographies,” Meline said in a press statement.
In a recent research report, Edward Tenthoff, a senior biotech analyst for Piper Sandler Cos, noted that in 2019 vaccines were among the top four therapeutic areas by revenue with global sales exceeding $ 33 billion. GlaxoSmithKline, Merck, Pfizer and Sanofi are the largest global vaccine manufacturers with cumulative 2019 sales of $ 25 billion, he added.
Biotech companies have scrambled to address the coronavirus pandemic. “Moderna, I really believe has risen to the challenge—they are obviously on the frontline,” Tenthoff said to Forbes. “They were the first company to present phase one data.” However, it’s not clear if Moderna would climb the ranks of larger biotech rivals if it releases a successful coronavirus treatment. “Great question,” Tenthoff said. “It will sure be a big start.”
Moderna, with a market cap of $ 22.2 billion, collected annual revenue of $ 60.2 million in 2019, down 55% from 2018. According to regulatory documents, the company explained the slide in sales as partially the result of lower revenue from its strategic alliances, including partnerships with AstraZeneca and Merck.
Meline replaces outgoing CFO Lorence Kim, who announced his departure plans in May. Before joining Moderna, Kim was managing director and co-head of the U.S. biotechnology investment banking effort at Goldman Sachs.
“I spoke with him, he’s leaving to pursue other interests,” Tentoff said. “He feels that the company is in a strong financial position and he’s leaving to do something different.” Moderna didn’t release further details of Kim’s plans after his departure.
Kim prepares to exit following some controversy. Kim was among top executives of the company who reaped a windfall of millions from selling shares only days after Moderna released the promising results of early trials of its Covid-19 vaccine in May. Some company observers questioned whether the executives timed the announcement to benefit from a temporary surge of share prices. The company has said that the shares were sold as part of an automatic arrangement aiming to protect against insider trading concerns.
“Executive sales are made under pre-planned 10b5-1 plans, which are executed during open trading windows in accordance with the Company’s insider trading policy,” the company said in a statement to Forbes. “As a matter of practice, Moderna does not intend to comment on any alleged or potential litigation or investigation; nor on purchases or sales by individual investors or groups.” A spokesperson for the Securities and Exchange Commission declined to comment on the stock sale.