Just over a year ago, CureVac was among the most sought-after biotech firms in the world, with then US President Donald Trump among its suitors. Trump was reported to have offered an undisclosed "large sum" to secure access to the firm's promising COVID-19 vaccine. The overture prompted the German government into action, leading to Berlin eventually buying a 23% stake in the biotech firm for €300 million ($358 million).The deal valued the Tübingen-based company at €1.3 billion.

A stellar New York share market debut followed in August. Shares in the vaccine contender more than tripled on the first trading day as investors bet on its messenger ribonucleic acid (mRNA) vaccine to offer a shield against a raging coronavirus. The company ended the day with a market value of nearly $10 billion (€8.4 billion). The company's valuation more than doubled over the next few months as BioNTech-Pfizer and Moderna won approvals for their mRNA vaccines riding on impressive efficacy data.

On Wednesday, CureVac's dream run hit a major stumbling block after the company said interim data showed its vaccine was only 47% effective in a late-stage trial, well short of the high bar set by other mRNA vaccines. Immediately, shares in CureVac — which has partnered with Elon Musk's Tesla to build portable RNA microfactories — plunged by as much as 50% to their lowest in more than seven months, wiping off more than €6 billion from the company's market value.

"The results are sobering," said CureVac Chief Executive Franz-Werner Haas. "We recognize that demonstrating high efficacy in this unprecedented broad diversity of variance is quite challenging.''

What went wrong?

The CureVac vaccine hardly differs from the mRNA vaccines developed by BioNTech-Pfizer and Moderna. However, unlike the components of its competitors, the nucleotides used in the CureVac vaccine are not chemically modified. One shot of CureVac requires only 12 micrograms of the vaccine, compared to 30 micrograms per dose for BioNTech-Pfizer and 100 micrograms per dose for Moderna.

In addition, the CureVac vaccine can be kept at regular refrigerator temperatures for at least three months, whereas the BioNTech and Moderna vaccines need to be stored at significantly cooler temperatures.

From a scientific point of view, it's worth taking a look at the possible reasons why the CureVac vaccine fell short of expectations. The efficacy trial with around 40,000 subjects is being conducted in 10 countries in Latin America and Europe, including the United Kingdom and Brazil. CureVac is late to the game, and in the meantime, virus variants that are significantly more aggressive than the original have taken over in these places.

According to CureVac's second interim analysis, 124 positive COVID cases were sequenced to identify the particular viral variant that caused the disease. The original virus only showed up in one case. More than half of the cases were caused by what the World Health Organization calls "variants of concern." The variants C.37 (lambda), which was first discovered in Peru, and B.1.621, which was first discovered in Colombia, were also detected.

The CureVac vaccine achieved low efficacy in an "unprecedented setting with at least 13 variants," the company said in a statement. The European Medicines Agency has specified an efficacy of at least 50% for authorization, but the CureVac trial will continue regardless.

An efficacy of 47% is well below that of the vaccines developed by competitors BioNTech-Pfizer and Moderna, which have recorded efficacy rates of more than 90%. But the now dominant virus variants also significantly weaken the efficacy of the already approved vaccines, as recently shown by a British study using BioNTech-Pfizer published in The Lancet medical journal.

Jolt to mRNA ambitions

Founded in 2000 and backed by German billionaire and co-founder of software firm SAP Dietmar Hopp, CureVac has been banking on its RNA expertise to develop cancer therapies and vaccines for infectious diseases like rabies, yellow fever and malaria.

The company has yet to launch a product, with all the therapies and vaccines in its pipeline still in various stages of development. Barring the COVID-19 shot, known as CVnCoV, only one of its mRNA vaccines — rabies shot CV7202 — has entered clinical trials. The rest are in the preclinical stages.

"This could cast doubt on the competitiveness of its mRNA platform," said Jefferies analyst Eun K. Yang in a research note referring to CureVac's "disappointing" efficacy data.

Zhiqiang Shu, an analyst with Berenberg, said the interim data would only make it more difficult for the company to bring its vaccine to market. "Getting its COVID-19 vaccine approved, if any possibility remains, will not be as smooth or fast as the company would have hoped," Shu told DW.

Shu also said despite the setback, CureVac's mRNA platform was still promising. "We think the hope for potential approval is not entirely lost. Further, its second-generation vaccine will enter human trials in the next few months," he said.

Impact on EU vaccination drive

CureVac is among a handful of companies that have signed an advanced purchase agreement with the European Union. The bloc has agreed to buy 225 million doses of CVnCoV, with an option to buy another 180 million doses once the vaccine is proven safe and effective.

The company also signed a €75-million loan agreement with the European Investment Bank to speed up development and boost the production of vaccines. CureVac has also forged partnerships with pharma companies Bayer and GlaxoSmithKline in a bid to scale up production.

The interest in CureVac's vaccine rose in the past few months after several countries restricted the use of COVID-19 vaccines developed by Johnson & Johnson and AstraZeneca, citing adverse side effects.

Meanwhile, the German Health Ministry has said CureVac's failure to meet its efficacy goal would not slow down the country's vaccination drive.