HHS cancels Moderna's $590 million contract for bird flu vaccine

Madison Muller, Bloomberg News on May 28, 2025

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U.S. health officials are terminating a $590 million contract with Moderna Inc. to develop vaccines for bird flu, a major setback for the company that’s also facing additional government scrutiny over immunizations.

Moderna said in a statement Wednesday that the vaccine was shown to be safe and well-tolerated in early clinical studies. It had planned to move the vaccine into later-stage trials with funding from the Department of Health and Human Services, but received notice that the agency was terminating its award.

“Today Moderna received notice that HHS will terminate the award for the late-stage development and right to purchase pre-pandemic influenza vaccines,” the company said. Chief Executive Officer Stéphane Bancel said Moderna will continue to explore other paths forward for the program.

Bloomberg first reported in February that the Trump administration was reviewing Moderna’s contract, part of a broader push to examine spending on messenger RNA-based vaccines — the technology that powered Moderna’s COVID vaccine. The Biden administration had awarded the funding in its final days, boosting the company’s stock in the days following the Jan. 17 announcement.

HHS Secretary Robert F. Kennedy Jr. has been pushing for more studies on vaccines, while rolling back long-standing recommendations around COVID shots for children and pregnant women.

The move to terminate Moderna’s contract comes as the U.S. has grappled with a bird flu outbreak that has affected dozens of cattle herds along with poultry flocks nationwide, which sent egg prices soaring.

While human cases have been relatively rare, the bird flu virus has caused deaths in the past, and experts are concerned that it could become more transmissible and dangerous. Though the risk to the public remains low, according to the U.S. Centers for Disease Control and Prevention.

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(With assistance from Gerry Smith, Jessica Nix and Rachel Cohrs Zhang.)