Personalized cancer vaccines from Moderna and Merck up the combined market value of the drugmakers by more than $50 billion. This growth is creating new investment opportunities in the diagnostics sector, specifically in genetic sequencing used to identify patient-specific mutations for vaccine doses.
Tempus AI, a genomic sequencing firm, is positioned to benefit from this trend. The company has stated it will act as thesequencing partner if the Moderna-Merck vaccine receives regulatory approval. Analysts view this process as a recurring revenue stream per patient rather than a one-time service.
Revenue projections for the melanoma vaccine alone could range from $50 million to over $600 million annually, according to estimates from Piper Sandler and BTIG analyst Mark Massaro. The higher estimate assumes an expansion into treating lung, bladder, and kidney cancers.
Beyond initial sequencing, minimal residual disease (MRD) testing for monitoring cancer recurrence is seen as a multibillion-dollar opportunity. Bioaxia CEO Douglas Eby notes that initial sequencing acts as a customer acquisition funnel, bringing patients into the Tempus ecosystem for long-term monitoring.
The market is currently led by Natera, which has a valuation of approximately $45 billion. However, the mRNA cancer vaccine space remains unproven and volatile, as evidenced by a recent setback in a BioNTech colorectal cancer vaccine trial.
