BioNTech Reports Solid Fourth-Quarter Results

No-moat BioNTech BNTX reported solid fourth-quarter results, bringing full-year revenue to about $482 million, above Factset consensus expectations and representing 344% growth from 2019. Unsurprisingly, its COVID-19 vaccine, Comirnaty/BNT162b2 (partnered with Pfizer PFE and Fosun Pharma), was the highlight of the quarter, as strong commercial revenue drove the company to its first year of net profits and largely surpassed our expectations on the bottom line. We are maintaining our no-moat rating and intend to modestly raise our $76 per share fair value estimate based on this near-term strength as we roll forward our valuation model.

After receiving approval for emergency use in December 2020, BNT162b2 generated over $300 million in commercial revenue. For the full year, management expects vaccine-related revenue to hit at least $9.8 billion based on its current supply deals, which amounts to roughly 1.4 billion doses. While this exceeds our model's expectations, we recognize that a fair amount of upside exists. The company and its partners are likely to secure additional supply contracts, as access to the vaccine broadens across geographies and populations. In addition, we’d like to note that the company increased its manufacturing capacity target to 2.5 billion doses from 2 billion for 2021, which would provide additional revenue streams. The company also increased its operating spend in 2020, with research and development costs nearly tripling for the year to $645 million. 2021 guidance for expenses remains elevated, as the company intends to aggressively support its pipeline development beyond mRNA.

Turning to its pipeline in oncology, we look forward to top-line updates from BNT311 and BNT312, two bio-specific antibodies, currently under phase 1/2 trials, and we expect for several of its candidates, such as BNT111 for advanced melanoma and BNT113 for HPV 16+ head and neck cancer, to initiate phase 2 trials in 2021.

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