Book Build Report: Moderna IPO Shows Investor Demand

Dec. 06, 2018 1:19 PM ETModerna, Inc. (MRNA)5 Comments


  • Moderna is ready to float its public offering of $500 million in a bellwether IPO.
  • The firm is advancing an ambitious pipeline of vaccines and treatments using mRNA technologies.
  • Institutional demand is strong, but the firm is still in early stages of development on technologies that have previously failed.
  • With market volatility high, interested investors may consider watchlisting MRNA with an eye to a lower entry point post-IPO.
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moderna ipo

Quick Take

The Moderna (NASDAQ:MRNA) IPO is indicating strong investor demand according to IPO information service IPO Boutique.

The firm is advancing a large and diverse pipeline of disease treatment candidates and vaccines based on its proprietary mRNA protein platform.

While institutional demand for the IPO is encouraging, efficacy trials are still ahead, valuation isn’t cheap, and overall stock market volatility may present patient investors with a lower entry point post-IPO.


Moderna was founded in 2010 to discover and develop mRNA-based therapeutics and vaccines across a broad array of human diseases.

Management is headed by Founding CEO and Director Stéphane Bancel, who has been with the firm since 2011 was previously CEO at bioMérieux.mRNA transfers the instructions stored in DNA to make the proteins required in every living cell.

Every cell in the human body leverages mRNA in the existing natural processes to produce a huge variety of proteins, including secreted, membrane, and intracellular proteins, in varying quantities, in different locations, and in various combinations.

Moderna has developed and continues to invest in its platform, Research Engine and Early Development Engine, to boost the technological advancement of mRNA medicines.

The company has a portfolio pipeline of 21 programs, ten of which have entered clinical studies and three others have open INDs.

IPO Book Build Update

According to IPO Boutique,

Our sources state the Moderna Inc (MRNA) deal was 10x oversubscribed at the Tuesday closing. We anticipate that the final number could and should grow once retail orders are included. According to our sources, the deal is expected to be upsized by 20% to roughly 26.0mm shares. The underwriters are guiding pricing to the midpoint of the $22-$24 range. Despite the current volatile market tape, it is our opinion that this IPO will still provide a very nice premium.


I previously wrote about Moderna’s IPO prospects in my article, Moderna Proposes Terms For $500 Million IPO.

In that analysis, I highlighted the firm’s very high valuation expectations, with an enterprise value of $6.2 billion at IPO, for its early Phase 2 stage of development.

Moderna’s management has switched strategies, first focusing on treatments, then on vaccines, and now back again on treatments.

Also, the mRNA approach to disease treatment has been tried before and failed. Moderna and its investors believe that it is on the right track with its proprietary platform, but the firm has only passed safety trials so far. Efficacy trials are still ahead and present the highest risks.

As to demand for its shares, it is not uncommon for high demand IPOs to see that demand evaporate post-IPO, especially in highly volatile markets.

My original opinion on the IPO was NEUTRAL, and although the institutional demand appears to be solid based on the book build data, given the extreme volatility in the overall stock market, I see no reason to change that NEUTRAL opinion.

Interested investors simply may be better off being patient and putting the stock on a watchlist, as there is an increased chance the stock will test the IPO price in post-IPO trading volatility.

Expected IPO Pricing Date: December 6, 2018.

Thank you for reading. I write about IPOs and M&A deals, though I focus most of my time on IPOs. If you're interested in investing smarter in IPOs, you should check out IPO Edge.

This article was written by

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