Moderna has interim data it says support advancing its avian influenza vaccine into a late-stage clinical trial, but the U.S. government has canceled the federal contract that would have financed it, a move that comes as outbreaks of so-called bird flu continue throughout the country.
The Department of Health and Human Services gave Moderna notice that it will terminate the contract, including the right to purchase pre-pandemic influenza vaccines, the company said late Wednesday.
The federal government often contributes funding for the development and testing of drugs and vaccines that address public health threats. Under Operation Warp Speed, Moderna received federal funding for the development of its messenger RNA Covid-19 vaccine, Spikevax.
The traditional method of making vaccines by using chicken eggs as the growth medium for a virus requires a long lead time. By contrast, mRNA vaccines offer the advantage of speed. Once a target pathogen has been identified and sequenced, mRNA can quickly be designed and produced to address it. This faster turn-around time makes mRNA vaccines attractive for pandemic preparedness.
The avian influenza contract with the government was initially awarded last summer with a $176 million commitment. In January, just prior to President Trump taking office, HHS expanded the contract to $590 million. Funds came from HHS, the Administration for Strategic Preparedness and Response, and the Biomedical Advanced Research and Development Authority (BARDA).
The Moderna vaccine candidate, code-named mRNA-1018, reached Phase 1/2 testing against four different types or subtypes of avian flu. The company on Wednesday reported interim results for about 300 heathy adults who received a version of mRNA-1018 designed to address the H5 avian influenza virus subtype. This vaccine is administered as two intramuscular injections, 22 days apart.
Moderna said results show mRNA-1018 demonstrated “a rapid, potent and durable immune response.” At baseline, pre-existing immunity was minimal. At day 43, three weeks after the second injection, 97.8% of participants showed levels of antibodies at or greater than the threshold needed for protection. Moderna said the vaccine was well tolerated by study participants and most of the adverse reactions were classified as Grade 1 or 2. The company plans to submit more detailed data for presentation at a future scientific meeting.
Cancellation of the Moderna contract was not completely out of the blue. Soon after Robert F. Kennedy, Jr. was confirmed as the new HHS secretary, the department said it was reviewing the contract. Federal vaccine policy continues to change. The FDA and HHS have revised their policy on Covid-19 vaccines, supporting vaccination primarily for high-risk groups, such as the elderly. Earlier this week, HHS Secretary Kennedy announced that Covid vaccines have been removed from the Center for Disease Control and Prevention’s recommended immunization schedule for healthy children and healthy pregnant women, saying “it’s common sense and it’s good science.”
In its report of first quarter 2025 financial results, Moderna said Spikevax revenue declined year over year. The company attributed the lower sales to lower vaccination rates as the Covid-19 vaccine market becoming a seasonal one with most of the demand coming in the fall and winter months. But the federal government’s policies on Covid-19 vaccines could affect how and whether insurance companies cover the shots, which could in turn further erode Moderna’s revenue. At the end of the quarter, Moderna reported its cash position was $8.4 billion, down more than $1 billion from the end of 2024.
According to the latest CDC data, H5 bird flu is widespread in wild birds worldwide and is causing U.S. outbreaks in poultry and dairy cows. In humans, the agency lists 70 cases of bird flu and one death to date. There have been no reported cases of person-to-person spread, and the CDC classifies the public health risk as low. Meanwhile, Moderna said it will look for other ways to fund late-stage development and manufacturing of the vaccine “consistent with the company’s strategic commitment to pandemic preparedness.”
“While the termination of funding from HHS adds uncertainty, we are pleased by the robust immune response and safety profile observed in this interim analysis of the Phase 1/2 study of our H5 avian flu vaccine and we will explore alternative paths forward for the program,” Moderna CEO Stéphane Bancel said in a prepared statement. “These clinical data in pandemic influenza underscore the critical role mRNA technology has played as a countermeasure to emerging health threats.”
Photo: thianchai sitthikongsak, via Getty Images