U.S. pharma giant Merck & Co., Inc. (NYSE: MRK) announced Tuesday ahead of the market open that it divested its direct stake in Moderna Inc (NASDAQ: MRNA) in the first half of the fourth quarter.
Merck initiated a direct investment in the vaccine developer in 2015 and hiked the stake in 2018, in accordance with an R&D collaboration agreement executed between the companies.
Merck said it profited from the investment, particularly in 2020, given the substantial appreciation in Moderna shares catalyzed by its vaccine program.
Moderna shares are up about 620% year-to-date.
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Merck said it will record a small fourth-quarter gain on the stake sale under "other (income) expense, net."
The company said it retains exposure to Moderna indirectly through its investments in venture funds.
What's Next: Moderna is awaiting word on the emergency use authorization application it filed with the FDA for its vaccine candidate mRNA-1273.
The regulator is likely to announce its verdict following the Adcom meeting scheduled for Dec. 17.
The company has also filed for conditional marketing authorization in Europe, with the European Medicines Agency expecting to rule on the application by Jan. 12.
MRK, MRNA Price Action: At last check, Moderna shares were up 4.46% at $147.30, while Merck shares were up 0.64% at $82.06.
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December 02, 2020 at 11:12PM
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