Key Points

This biotech firm is advancing multiple candidates in its pipeline.
It may secure a stronger set of approved products in the coming years.

Eli Lilly (NYSE: LLY), Merck (NYSE: MRK), and Pfizer (NYSE: PFE) rank among the biggest pharmaceutical companies globally. Lilly leads in diabetes and weight management treatments, while Merck and Pfizer hold strong positions in oncology. Merck has led this group in performance this year, yet a smaller biotech has surged ahead since the start of 2026: Moderna (NASDAQ: MRNA). Its shares have climbed 43 percent year to date, supported by solid reasons for further gains ahead.

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Why Moderna's shares have climbed

Moderna gained prominence through its leading coronavirus vaccine. However, COVID-related efforts no longer drive major growth. Investors now focus on pipeline advancements, which have shown strong progress recently. The company submitted applications for a flu vaccine in the U.S., Europe, Australia, and Canada earlier this year and awaits approval.

Moderna aims to address gaps in this market, where current flu vaccines often show limited effectiveness, with efficacy rates typically between 40 percent and 60 percent in peak seasons and sometimes lower. This leaves high-risk groups such as seniors exposed to serious illness, hospital stays, or worse outcomes.

Moderna's mRNA-1010 showed superior results compared to standard vaccines in older adults during trials, positioning it for potential success if approved. This progress has contributed to the stock's gains. The company also advances mRNA-4157, a personalized cancer vaccine developed with Merck, which stands as one of its most promising assets.

In phase 2 trials, mRNA-4157 combined with Merck's Keytruda lowered the risk of recurrence or death in advanced melanoma patients more than Keytruda alone. Multiple phase 2 and phase 3 studies continue for this candidate, targeting a sizable market where analysts project billions in potential sales. Updates on mRNA-4157 remain key to the company's outlook in the medium term.

Is the stock still worth considering?

Moderna stands out as an innovative vaccine developer. Its mRNA platform offers advantages because these vaccines can be created more quickly than traditional ones, which require growing and weakening live viruses. For mRNA versions, researchers identify the pathogen's genetic sequence, design a matching molecule, and inject it to trigger immune responses through natural processes.

This speed helped mRNA vaccines capture much of the coronavirus market. Moderna maintains a broad pipeline of such candidates across various areas. Its phase 3 programs, including mRNA-4157 and mRNA-1010, could lead to new approvals and boost revenue and earnings. Yet risks exist. Following this year's rise, Moderna holds an 18 billion dollar market cap.

This valuation appears elevated for a firm with limited revenue of 389 million dollars in the first quarter and ongoing losses. While the platform shows promise, some gains from late-stage candidates may already be reflected in the price. Setbacks in trials or approvals could pressure shares, leading to notable swings. Those tolerant of volatility might start with a modest stake, while others may prefer more established biotech names.

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Prosper Junior Bakiny has positions in Eli Lilly. The Motley Fool has positions in and recommends Eli Lilly, Merck, Moderna, and Pfizer. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.