Shares of Moderna surged Thursday after it announced that the Food and Drug Administration cleared its coronavirus vaccine for a phase 2 trial, what the company called a "crucial step."
Moderna said it will begin phase 2 trials with 600 participants shortly and is finalizing plans for a phase 3 trial as early as this summer.
"We are accelerating manufacturing scale-up and our partnership with Lonza puts us in a position to make and distribute as many vaccine doses of mRNA-1273 as possible, should it prove to be safe and effective," CEO Stephane Bancel said in a statement. The company hopes to start a phase 3 trial early this summer here, which would line it up for approval for public sale as soon as 2021, he said.
The company's shares jumped more than 16% in premarket trading before losing gains after the open. In early trading the stock was up nearly 6%.
The company said it expects to "incur significant expenses this year" related to the development of and manufacturing of its potential vaccine. However, it added that it expects "a close matching of expenses and reimbursements for those expenses" from its award by the Biomedical Advanced Research and Development Authority.
BARDA, which is a part of the Department of Health and Human Services, last month warded Moderna up to $483 million in funding to accelerate development of the Covid-19 vaccine candidate.
The race to develop anything to fight the coronavirus is intensely competitive and investors are watching closely for signs of progress on treatments and vaccines. Moderna, as well as other companies in the race, is ramping up manufacturing ahead of approval so that it can rapidly distribute doses if their candidate proves effective against the virus and safe for humans.
Last week, Moderna announced a 10-year partnership with Swiss drugmaker Lonza to accelerate production of the experimental vaccine. Bancel told CNBC at the time that the company hopes to begin manufacturing its potential vaccine "as early as July."
"Our team is ready to start dosing as soon as we get the green light," Bancel said on "Squawk Box." He added that with the partnership, the company hopes to be able to manufacture about 1 billion doses per year.
The potential vaccine, which was developed by researchers at Moderna and the National Institutes of Health, became the first candidate to enter a phase 1 human trial in March.
The vaccine candidate uses synthetic messenger RNA to inoculate against the virus. Such treatments help the body immunize against a virus and can potentially be developed and manufactured more quickly than traditional vaccines.
Covid-19 has infected more than 3.7 million people around the world and killed at least 264,000, according to data compiled by Johns Hopkins University.
As the company's focus shifts toward developing its coronavirus vaccine candidate and as the virus itself disrupts society across the world, Moderna warned that development of treatments for other diseases are being disrupted and delayed. Affected treatments include a potential personalized cancer vaccine and others.
The company also announced several changes in management roles related to vaccine development, regulatory affairs and infectious diseases.
"We are excited to welcome these three new senior leaders, who bring extensive clinical development, regulatory and commercial experience, as we begin to pivot towards late-stage development and commercialization," Bancel said Thursday of the new hires.
The company said it has $1.7 billion in cash and investments and up to $700 million available in potential grants and awards.