Moderna Inc. dropped the most in two months in early New York trading Thursday after U.S. President Joe Biden’s administration backed waiving patents on COVID-19 vaccines and the company’s quarterly revenues missed analysts’ expectations.

U.S. support for the patent proposal, intended to increase the supply of life-saving shots, hit vaccine makers, even as Moderna recorded its first-ever profitable quarter and slightly raised annual product sales projections. Novavax Inc., Curevac NV and vaccine partners Pfizer Inc. and BioNTech SE also fell, while Moderna’s shares lost 12 per cent as of 9:36 a.m., the most intraday since Feb. 23.

Moderna is racing to bolster production capacity to help inoculate the world from COVID-19, pledging investments in U.S. plants and overseas contractors that will raise supply of its COVID vaccine to as many as 3 billion doses next year. Yet as many countries struggling with a resurgence of the virus, the Biden administration said it will push for a waiver of the rights at the World Trade Organization, and the European Union said it was willing to participate.

A possible patent waiver “doesn’t change anything for Moderna,” Chief Executive Officer Stephane Bancel said on a conference call with investors, as there is no excess manufacturing capacity for the vaccine’s key ingredient, messenger RNA, anywhere in the world. “We saw the news last night and I didn’t lose a minute of sleep.”

Moderna’s revenues of US$1.94 billion came in short of Wall Street expectations. Its 4.3 per cent increase in projected annual product sales to US$19.2 billion pales in comparison to the US$26 billion that rival Pfizer Inc. now expects from COVID vaccine sales this year.

The results show just how high the expectations have become for Moderna as it races to keep pace with the Pfizer-BioNTech SE juggernaut to produce vaccines to sell outside the U.S., the country where most of Moderna’s initial COVID vaccine supply has gone.

Vaccine in Teens

Meanwhile, Moderna said that initial results from its trial of its COVID vaccine in adolescents ages 12-to-17 showed that it was 96 per cent effective, with no serious safety problems identified so far. The company is continuing to collect data and is in discussions with regulators about amending its emergency use authorization to include teenagers, it said.

On Wednesday, Moderna also released results of preliminary human trials showing that two types of booster shots helped bolster immune responses against variants that surfaced in South Africa and Brazil.

Earnings for the quarter were US$2.84 a share, Moderna said. Analysts had expected adjusted earnings of US$2.34 a share.