Moderna pauses Kenya plant plans as COVID vaccine demand wanes

(Reuters) -Moderna said on Thursday it had paused its plans to build a vaccine manufacturing facility in Kenya, following a post-pandemic decline in demand for COVID-19 vaccines.

The move is in line with Moderna's strategy of resizing its manufacturing network to cut costs, even as it aims to spend around $4.5 billion this year in research and development of several new vaccines, including for cancer and respiratory syncytial virus (RSV).

Many of the messenger RNA (mRNA) vaccines that Moderna is developing, like for HIV and malaria, are at an early stage.

"Given this, and in alignment with our strategic planning, Moderna believes it is prudent to pause its efforts to build an mRNA manufacturing facility in Kenya," the company said.

Moderna's strategy is a setback to efforts in Africa to cut reliance on vaccine and drug imports from outside the continent.

"To respond effectively to infectious disease outbreaks or better yet prevent them in the first place, it is crucial that there is local vaccine manufacturing capacity and capability to support local needs," said Charlie Weller, head of prevention in the infectious disease team at Wellcome.

Wellcome is a health research funding and advocacy foundation.

The company had said in 2022 that it would invest about $500 million in the Kenya facility and supply as many as 500 million doses of its mRNA vaccines to Africa each year.

It also had plans to start filling doses of its COVID vaccine in the continent as early as 2023.

However, Moderna has not received any vaccine orders for Africa since 2022 amid waning demand globally, the company said.

The drugmaker said it had taken more than $1 billion in losses and write-downs related to the cancellation of previous orders from Africa.

(Reporting by Leroy Leo in Bengaluru; Editing by Shailesh Kuber and Sriraj Kalluvila)