Analyst Note
| Karen Andersen, CFA |We're raising our BioNTech fair value estimate to $200 from $177 per share after incorporating Europe's recent COVID-19 vaccine option exercise for 2022, Pfizer's latest update on contracted COVID-19 vaccine sales for 2023, and a small placeholder for potential profit share on an mRNA-based shingles vaccine. Despite BioNTech's massive success with its mRNA-based COVID-19 vaccine, we think the changing competitive landscape, uncertain virus evolution, and many unknowns for safety and efficacy of this technology beyond COVID-19 all create too many questions to grant BioNTech an economic moat. That said, with a recent shareprice pullback, we now see shares as relatively fairly valued. We now assume that BioNTech will book COVID-19 vaccine revenue from its Pfizer gross profit share of EUR 17.3 billion in 2021 and EUR 19.1 billion in 2022, followed by a step down in sales in 2023 and EUR 1 billion annually beginning in 2024, to account for continued COVID-19 vaccinations in vulnerable (mostly elderly) populations. We assume Glaxo's Shingrix is capable of generating $5 billion in annual sales by 2025, creating a large potential market for Pfizer/BioNTech if their mRNA-based vaccine is able to differentiate. While it could be a tall order to surpass Shingrix on efficacy (97% efficacy after two doses), mRNA-based vaccines could avoid manufacturing delays that limited Glaxo's Shingrix sales ramp.