LIVE MARKETS-GAVI funding cuts loom, but Bernstein analysts urge calm

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GAVI FUNDING CUTS LOOM, BUT BERNSTEIN ANALYSTS URGE CALM

President Donald Trump's administration plans to end U.S. funding for vaccine alliance GAVI are unlikely to cause a significant impact on U.S. vaccine makers, Pfizer PFE.N, Merck MRK.N and Moderna MRNA.O, according to analysts at brokerage Bernstein.

The $300 million cuts to GAVI funding make up less than 1% of the $29 billion revenue earned from vaccines by the three drugmakers in 2024, the analysts said, highlighting the minimal impact to their revenue and profits.

The cut would be spread across 20 vaccine programs, including those from other vaccine companies, further diluting impact, according to the brokerage.

Bernstein analysts said any negative reaction from the market in response to the funding cuts would be "overreactions."

Shares of vaccine maker Pfizer are down 5.5% year to date, while Moderna is down 24.5% and Merck is down 11.6% for the year so far.

While a cut of up to $300 million, which makes up about 16% of GAVI's annual funding, the analysts believe it is likely manageable due to the diverse funding sources, including major contributors such as the UK, Norway and Australia.

The U.S.-supported GAVI spending is minimal compared with the total vaccine market, the analysts said, adding that expanded contributions from countries such as Germany, France, Italy, and Spain partially compensate for the U.S. funding withdrawal.

(Siddhi Mahatole)

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