Moderna to cut 10% of workforce amid slow COVID vaccine sales

In a significant move, Moderna, a biotech company based in Cambridge, Massachusetts, announced plans to reduce its global workforce by 10%. This decision was communicated by CEO Stéphane Bancel in an internal letter to employees, highlighting the company’s ongoing cost-cutting strategy to lower annual operating expenses by approximately $1.5 billion by 2027. As a result of these cuts, Moderna is expected to have fewer than 5,000 employees by the end of the year. The decision comes as Moderna faces declining sales of its COVID-19 vaccine, which has been attributed to the pandemic transitioning into an endemic stage. The company has been seeking new revenue streams, betting on its innovative mRNA technology to develop combination vaccines for COVID-19 and flu, as well as potential treatments for rare diseases and various cancers. Despite these efforts, Moderna's stock is reported to be down over 90% since the height of the pandemic. In an attempt to mitigate the impact of layoffs, Moderna has engaged in several strategies, such as scaling back research and development activities, reducing manufacturing expenses, and renegotiating contracts with suppliers. CEO Stéphane Bancel noted that these decisions were challenging and emphasized the impact on employees who have significantly contributed to the firm's mission. Bancel expressed gratitude to those affected, pointing out the dedication and hard work that helped build the company. Looking ahead, Moderna remains focused on its core competencies while aiming for new product approvals in the coming years. The company has three approved products and could potentially secure up to eight additional approvals within the next three years. The decision to downsize reflects both a response to current market realities as well as a strategic pivot towards becoming a leaner, more focused organization in the face of changing industry trends.