Moderna Stock Is Climbing. It Has Been a Tumultuous Few Days for Pharma.

Moderna’s revenue has taken a hit amid declining demand for its Covid vaccine. (Adam Glanzman/Bloomberg)

Moderna stock surged on Tuesday amid what has been a lively past few days for the pharmaceutical industry.

The tumultuous period kicked off when President Donald Trump’s massive tax-and-spending bill was signed into law Friday. The legislation includes a provision that allows companies to immediately expense their U.S.-based research and development. The change allows for quicker deductions in a way that improves near-term cashflows.

Moderna’s cash flow issues are more immediate than those of its peers, so the new provision could have a greater impact on operations. Moderna saw revenue peak during the pandemic, as the maker of one of three FDA-approved Covid-19 vaccines, but the drugmaker has struggled since then amid declining demand.

Quarterly revenue plunged 94% from $1.86 billion in the first quarter of 2023 to just $108 million in the first quarter of 2025. Management guided for total revenue in the range of $1.5 billion to $2.5 billion this year—a fraction of the $19 billion recorded in 2022.

Novavax also saw gains on Tuesday, rising 5.1%. While Novavax reported earnings that handily topped expectations in the latest quarter, shares have plummeted from their pandemic-level highs. The company’s Covid vaccine is considered its primary product.

Shares of other pharma companies were seeing smaller gains. Pfizer was up 1.1%, while U.S.-listed shares of BioNTech gained 1.6%.

The passage of the tax bill wasn’t the only recent development making waves in the industry. A coalition of medical groups including the American Academy of Pediatrics filed a complaint in federal court on Monday, taking aim at what they call “unlawful, unilateral vaccine changes” directed by Health and Human Services Secretary Robert F. Kennedy Jr.

At the heart of the lawsuit lies Kennedy’s decision to remove healthy children and pregnant women from the Covid-19 vaccine schedule. The suit requests that the court reverse those changes and declare them unlawful.

There was more to come on Tuesday, when Trump floated a 200% tax rate on pharmaceutical imports during a Cabinet meeting. Companies will have “about a year” to shift their manufacturing operations to the U.S. or face steep tariffs. “We’ll give them a certain period of time to get their act together,” Trump asserted.

Moderna stock rose 9.5% to $32.75 on Tuesday, putting the stock on pace for the largest same-day percent increase since March 5, according to Dow Jones Market Data. Despite these gains, shares remain down 22% this year and 72% over the past 12 months.

The stock has seen elevated levels of short interest in recent months. As of mid-June, Moderna was the second most-shorted stock in the S&P 500 index, with 18.6% of shares sold short as a percentage of float. These levels are down from 19.27% in May, when Moderna was the most-shorted stock in the index.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com