American depositary receipts (ADRs) of BioNTech (BNTX) fell sharply on Monday after the company reported a significantly larger-than-expected loss for the second quarter. The dramatic increase in losses is attributed to a sharp decline in COVID-19 vaccine demand and the company’s decision to exit a partnership with Genmab for a lung cancer treatment.
Major Losses and Revenue Drop
BioNTech posted a second-quarter loss of €807.8 million ($886 million), translating to €3.36 per share, marking a quadrupling of its losses compared to the same period last year. The company’s revenue fell by 23.3% year-over-year to €128.7 million, although it was slightly better than analysts’ expectations.
The company attributed the drop in revenue primarily to the shift in COVID-19 vaccine demand from pandemic-level urgency to a more seasonal, endemic market.
Shift in Strategic Focus
Dr. Ugur Sahin, BioNTech’s co-founder and CEO, stated that the company is redirecting its focus towards cancer treatments. “2024 has been a pivotal year for our oncology portfolio, marked by significant data updates,” Sahin said.
In a related move, BioNTech announced it would no longer participate in the joint venture with Genmab (GMAB) for the development of a lung cancer drug, despite promising study results. The decision affects a planned Phase 3 trial, though Genmab will continue the project under existing agreements.
Stock Impact
Following the announcement, BioNTech’s ADRs dropped 5.3% to $77.64, marking their lowest level since 2020. Similarly, Genmab’s ADRs fell approximately 7% to $26.29.
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