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Moderna Stock Slumps, Regeneron Slides On Omicron Variant Efficacy Warnings

Moderna said its Covid vaccine would likely experience a 'material drop' in efficacy against Omicron, while Regeneron warned its antibody cocktail may also have reduced activity against the new variant.

Morderna  (MRNA) - Get Moderna, Inc. Report shares slumped lower in pre-market trading after the drugmaker cautioned that its Covid vaccine may not be as effective in fighting the new Omicron variant when compared to its success against other strains.

In an interview with London's Financial Times, CEO Stephane Bancel said the existing messenger-RNA based vaccine would likely experience a "material drop" in effectiveness against the new Omicron variant, compared to the Delta strain, and noted that any new vaccine would likely take months to develop, manufacture and deliver.

"I think it's going to be a material drop. I just don't know how much because we need to wait for the data," he told the paper. "But all the scientists I've talked to are like 'this is not going to be good'".

Regeneron Pharmaceuticals  (REGN) - Get Regeneron Pharmaceuticals, Inc. Report, meanwhile, said its Covid antibody treatment -- used to treat former President Donald Trump -- may be less effective against the Omicron variant, noting that there may be "reduced neutralization activity of both vaccine-induced and monoclonal antibody- conveyed immunity."

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Moderna shares were marked 7.3% lower in early Tuesday trading to change hands at $341.25 each. Regeneron shares fell 1% to $648.25 each.

The Omicron variant carries a spike protein -- the basis for infection -- that is vastly different to that which current vaccines are designed to neutralize, health authorities have said, and is mutating quickly.

Scientists and health officials have yet to determine if Omicron is vaccine resistant, with the World Health Organization cautioning that it could take "several weeks" to assess its full potential.

Earlier this week, Moderna's chief medical officer told the BBC that it may take "a couple of weeks" before it can be determined if Omicron is resistant to current vaccine structures, adding that any new dose would likely be reading in "early 2022".

Pfizer  (PFE) - Get Pfizer Inc. Report CEO Albert Bourla, however, told CNBC Monday that the drugmaker has created a new template that could speed the development of a new vaccine to combat Omicron if needed, adding it has the capability to make as many as 4 billion doses next year.

Pfizer shares were marked 1.2% higher in pre-market trading to indicate an opening bell price of $53.02 each.