10:35 AM EDT, 09/12/2024 (MT Newswires) -- Moderna ( MRNA ) said Thursday it plans to cut back on its research and development spending as the company looks to save costs and prioritize the launch of new products already in the pipeline.

The drugmaker expects to reduce its annual R&D budget to a range between $3.6 billion and $3.8 billion by 2027 from an estimated $4.8 billion at the end of this year.

"Moderna's ( MRNA ) broad clinical success and recent commercial challenges necessitate a more selective and paced approach to its research and development investment," it said in a statement.

The company plans to submit three of its five respiratory vaccines, including its next-generation COVID-19 vaccine and respiratory syncytial virus vaccine for high-risk younger adults, for approval this year. It has five non-respiratory products in clinical studies with potential for approval by 2027, Chief Executive Stephane Bancel said.

"The size of our late-stage pipeline combined with the challenge of launching products means we must now focus on delivering these 10 products to patients, slow down the pace of new (research and development) investment, and build our commercial business," according to Bancel.

Shares of the company tumbled 18% in Thursday trading.

For 2025 through 2028, Moderna ( MRNA ) intends to cut its R&D spending by 20% to $16 billion from a previous projection of $20 billion. Moderna ( MRNA ) estimates R&D expenses between $4.2 billion and $4.5 billion next year and total roughly $11.5 billion from 2026 to 2028.

The company anticipates revenue in a range of $2.5 billion to $3.5 billion for 2025, while the current consensus on Capital IQ is for $3.95 billion. For 2026 to 2028, it expects a compound annual growth rate of more than 25% driven by new product launches. Last month, the firm said it anticipates net product sales from its respiratory franchise to be in a range of $3 billion to $3.5 billion this year.

Moderna ( MRNA ) said Thursday it forecasts the commercial respiratory franchise to be profitable starting in 2024, with plans to complete the majority of its respiratory investments by 2026.

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