ABUS Stock Rallies Ahead Of Big Payout From Moderna Settlement This Week

• In March, Arbutus and its partner Genevant Sciences, a unit of Roivant Sciences, reached a global settlement with Moderna worth up to $2.25 billion. 
• The Moderna patent litigation centered on whether Moderna had used Arbutus’s patented technology without permission in its COVID-19 vaccine.
• Under the agreement, Moderna is required to make a $950-million upfront payment by July 8.

Shares of Arbutus Biopharma (ABUS) jumped 6% on Tuesday as investors awaited a payout from vaccine developer Moderna (MRNA) under a litigation settlement.

Settlement Payment Expected This Week

In March, Arbutus and its partner Genevant Sciences, a unit of Roivant Sciences (ROIV), reached a global settlement with Moderna worth up to $2.25 billion to resolve a long-running dispute over technology used in Moderna’s COVID-19 vaccines. Under the agreement, Moderna is required to make a $950 million upfront payment by July 8. Arbutus expects to receive approximately $179 million of that amount after costs, while the remaining goes to Genevant Sciences. The company then said that it is evaluating ways to return capital to shareholders later this year once the funds arrive. The company had total cash, cash equivalents, and marketable securities of $95.2 million as of the end of the first quarter. 

The Moderna patent litigation centered on whether Moderna had used Arbutus’s patented technology without permission in its COVID-19 vaccine. At its core, the dispute was over lipid nanoparticles (LNPs) — the tiny fat particles that protect and deliver mRNA into human cells. Without effective LNPs, mRNA vaccines like Moderna’s covid vaccine Spikevax would not work well. Arbutus had developed and patented specific LNP formulations years before the pandemic.

Pipeline Advances Continue

In the meantime, Arbutus is also progressing its main drug candidate for chronic hepatitis B. The treatment, imdusiran, received U.S. FDA Fast Track designation in April, which could speed up development and review. The company has reported positive early clinical results for the drug and continues to advance the program.

How Did ABUS Retail Traders React?

On Stocktwits, retail sentiment around ABUS stock stayed within the ‘extremely bullish’ territory over the past 24 hours, while message volume rose from ‘high’ to ‘extremely high’ levels.

A Stocktwits user highlighted the company’s achievements with imdusiran and opined that it has “significantly more value.”

Another user voiced hopes for the company issuing cash dividends following the Moderna payout.

According to data from Koyfin, both the analysts covering ABUS rate it a ‘buy’. The stock has a 12-month average price target of $5.14, representing a potential upside of about 3% from the stock’s last close.

ABUS stock has gained 9% year-to-date. 

Read More: SK Hynix’s Offering Reportedly Oversubscribed Multiple Times Amid Prolonged Memory Stocks Sell-Off

For updates and corrections, email newsroom[at]stocktwits[dot]com.