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Biotech firm aims to streamline operations and reinvest in high-growth areas such as oncology and rare diseases as it targets $1.5 billion in savings by 2027.
Image Credit: Adobe Stock Images/Thongdee
Moderna has announced a global workforce reduction of approximately 10%, aiming to operate with fewer than 5,000 employees by year-end. In a letter sent companywide, CEO Stéphane Bancel framed the move as a “difficult but necessary” decision to align the company’s cost structure with the evolving demands of its business.1
“Earlier this year, we committed to reducing our annual operating expenses by approximately $1.5 billion by 2027,” Bancel wrote in the letter. “We’ve made significant progress by scaling down R&D as respiratory trials conclude, renegotiating supplier agreements, and reducing manufacturing costs. Every effort was made to avoid affecting jobs. But today, reshaping our operating structure and aligning our cost structure to the realities of our business are essential to remain focused and financially disciplined, while continuing to invest in our science on the path to 2027.”
Moderna’s Q1 earnings showed revenue of $108 million, reflecting a year-over-year decline driven by reduced COVID-19 vaccination rates and the seasonal nature of its respiratory business. While a slight improvement from the previous year, the company posted a GAAP loss of $1 billion. The loss comes despite reduced operating costs, with R&D and SG&A down 19% and 23%, respectively, as Moderna continues to streamline operations and prioritize its oncology portfolio.2
"In the first quarter, we continued to execute with financial discipline, significantly reducing our operating expenses, and further prioritized our investments in oncology," said Bancelin, in a May press release. "Looking ahead, we are reiterating our 2025 financial framework and announcing a cost structure that is expected to reduce our annual operating expenses by approximately $1.5 billion by 2027. With several Phase III readouts approaching and continued momentum toward 10 product approvals, we remain confident in Moderna's long-term outlook."
The company explained that despite the loss, it maintains a strong cash position of $8.4 billion and reaffirmed its 2025 revenue outlook of $1.5 to $2.5 billion, expecting most product sales to occur in the second half of the year.2
The workforce reduction follows closely on the heels of Moderna’s latest vaccine approval, marking a pivotal moment as the company sharpens its focus and restructures for long-term growth. In May, the FDA approved mNEXSPIKE (mRNA-1283), the company’s next-generation COVID vaccine, for use in adults aged 65 years and older, as well as in individuals aged 12 to 64 years who have at least one risk factor for severe disease as defined by the Centers for Disease Control and Prevention. The approval marked the third product to receive regulatory authorization in Moderna’s portfolio.3
“This decision was not made lightly,” continued Bancel, in the letter. “It impacts teammates and friends who have dedicated themselves to our mission and who have helped build Moderna. I want to express, on behalf of the entire Executive Committee and on behalf of patients you have served, our deepest thanks for everything you have contributed.”
Despite the planned layoffs, Bancel noted that there are reasons to remain optimistic about the company’s future.
“Our mission remains unchanged,” he said, in the letter. “With three approved products and the potential for up to eight more approvals in the next three years, the future of Moderna is bright. We are sharpening our focus, becoming leaner, and staying ambitious in oncology, rare diseases and latent viruses.”
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