The news: Moderna has agreed to conduct a true placebo-controlled trial of its new COVID-19 vaccine, according to a post on X this week from Robert F. Kennedy, Jr.

The FDA recently introduced the trial requirement for new vaccines, which is a shift from prior testing standards. It wasn’t originally clear if the FDA’s mandate would apply to existing COVID-19 vaccines that receive updates, but Kennedy’s tweet implies that the health regulator needs to see another trial before approving Moderna’s updated shot.

Why it matters: The FDA’s stipulation that more testing is needed before granting approval is cost-prohibitive and time-consuming for vaccine makers. Plus, many medical experts question if placebo-controlled trials are necessary for vaccines that get updated. For instance, a Johns Hopkins Bloomberg School of Public Health research paper argues that this type of trial is unethical since it gives one group of study participants a placebo, which wouldn’t protect them against a serious, transmissible disease.

Zooming out: The Trump administration isn’t making things easy for pharma and biotech companies operating in the vaccine market.

• The government recently cancelled Moderna’s ~$760 million contract to develop pandemic-level influenza vaccines. Moderna also pulled its licensing application with the FDA for its flu-COVID-19 combo vaccine, noting it will need to resubmit efficacy data.
• The Moderna products are being developed with mRNA technology that’s used in two FDA-approved COVID-19 shots. mRNA has been repeatedly criticized by Kennedy and other federal health leaders.
• Vaccine makers that want their COVID-19 shots to be approved for younger and healthy people, and pregnant women, will need to conduct new clinical trials proving their benefit for these populations.

Zooming in: Moderna’s shares have plunged about 83% over the last year. The company was already dealing with waning demand for its COVID-19 vaccine, which significantly contributed to a 53% drop in YoY revenues in 2024. All of Moderna’s sales come from its vaccine products.

The final word: It’s difficult for vaccine makers to keep up with shifting requirements for getting shots approved, and for which groups of people. Companies may soon have to weigh pouring billions more into vaccine R&D against expanding or growing product offerings to other drug markets.

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