Biotech Is the Biggest AI Winner — Moderna Just Proved It

«The most exciting thing about the code of life is that it is, in fact, code — and code can be edited.»

– Walter Isaacson, The Code Breaker (2021)

mRNA.

Or Messenger ribonucleic acid.

Oh well, Thierry, let me first grab my Friday morning coffee. Yep, go for it!

And now, “let’s fetz”. Four letters that, until 2020, almost nobody outside a laboratory had ever said out loud.

You have probably heard the word a hundred times since. Odds are nobody ever told you what it actually means.

Let’s fix that.

Start with what your body already does, every second, without asking. Deep inside each of your cells sits DNA — the master blueprint, locked in the vault, never handed out. When a cell needs to build something, it does not send the blueprint to the workshop. It sends a copy of one page. That single-page photocopy is mRNA: a short, disposable instruction that says «build this one protein, right here, right now», and then dissolves.

That is the whole trick.

mRNA is not a drug in the old sense. It is a message. And the astonishing idea — decades in the making — was this: if the body reads its own messages to build proteins, what if we wrote the message ourselves?

Hand a cell a synthetic instruction, and it becomes the factory. Tell it to build the spike of a virus, and your immune system meets the enemy and learns its face — without ever meeting the virus. That is a vaccine (Chart 1). Tell it to build a marker sitting on a tumour, and you can teach the body to hunt cancer. Same platform. Different message.

For most of pharmaceutical history, a new drug meant a new molecule — years of chemistry, one target, one shot. mRNA breaks that model. The manufacturing barely changes from one product to the next; what changes is the four-letter sequence you type in. Swap the text, keep the machine.

Which is why Covid was the accident that lit the fuse. When the pandemic hit, the genetic code of the virus was published online. Weeks later — not years — a vaccine sequence existed. The technology had been waiting in the wings for a decade; it just needed a stage.

But here is the part that matters for the next ten years. If a medicine is now, at heart, a sequence of letters, then designing one stops being only a chemistry problem.

It becomes a data problem.

Which sequence folds the right way? Which one the immune system will actually notice? Which of a billion possible edits is the one that works? These are pattern questions across oceans of biological data — and pattern-finding across oceans of data is precisely the thing this decade built a new kind of machine to do.

And this is why biotech is one of the biggest beneficiaries of AI.

And one company in it has mRNA as a ticker and in its name.

Moderna.

Chart 1: mRNA the technology vs MRNA the company — same four letters, one is a molecule, the other a Nasdaq ticker

The Code Became Software — and Software Is What AI Eats

But Moderna is only the loud half of the story. The quiet half is what just happened to the whole of biology — and why a machine you already know from your phone is now pointed at it.

For most of history, biology was read-only.

We could observe a cell, poke it, watch what happened, and guess. Drug discovery was closer to prospecting than engineering: try ten thousand compounds, hope one sticks, and take a decade to find out. Somewhere between 90% and 95% of drugs that enter human trials still fail. The whole industry is built on that brutal arithmetic.

Two things changed the game at the same time.

First, biology became writable. Between mRNA — writing instructions the cell will read — and CRISPR, the gene-editing tool that lets scientists change the blueprint itself, the code of life stopped being something we only read. It became something we could edit. That is the story Walter Isaacson tells in The Code Breaker, our newest Book Club edition — the same author who wrote the definitive biographies of Steve Jobs and Leonardo da Vinci, here turning that same eye on Jennifer Doudna and the gene-editing revolution. If you want to go down the rabbit hole with a book that actually reads like a thriller, start there.

And if you fancy it, his other work comes warmly recommended too.

Second, biology became a data science. Once a medicine is a sequence, and a cell’s behaviour is a dataset, the bottleneck moves. It is no longer «can we read the code» but «can we search it fast enough». And searching unimaginably large spaces for the one pattern that works is exactly what modern AI does for a living.

Think of what a single AI model of Google did to protein folding (the puzzle of how a protein twists into its 3D shape) — a problem that stumped biology for fifty years (50 (!) years), largely solved by a machine that had learned the patterns. Now point that same capability at which mRNA sequence to build, which tumour marker to target, which patient will respond. The old funnel — ten thousand guesses, one winner, a decade of waiting — gets shorter, cheaper, and smarter at every step.

Put simply: instead of mixing ten thousand chemicals and praying, you type four letters and let the machine tell you which ones to try. That is a different kind of work entirely.

Isn’t that absolutely crazy?

That is the quiet revolution. Not a robot doctor. A design engine. Biology has become, for the first time, something you can compute — and the firms sitting on the most biological data, with the tools to read it, are holding the raw material of the next decade.

Which brings the theory crashing into the real world.

On a single day this August.

Chart 2: The Code Breaker — Walter Isaacson on Jennifer Doudna, gene editing and the future of the human race

Moderna’s +177%: When the Message Beat the Cancer

For years, Moderna was «the Covid company».

One brilliant product, a mountain of cash, and a nagging question: was the mRNA platform a genuine engine, or a one-hit wonder riding a pandemic?

On 19 August, the market got its answer.

Moderna and its partner Merck reported that intismeran — an individualised cancer therapy — succeeded in a Phase 3 trial in high-risk melanoma (a serious type of skin cancer). Combined with Merck’s Keytruda, it meaningfully improved the odds of patients staying cancer-free after surgery, versus Keytruda alone. Earlier five-year data had already shown a 49% reduction in the risk of recurrence or death.

This was the confirmation.

Here is why it is individualized, and why that is the whole point. The therapy is built for one patient. Doctors sequence that person’s specific tumour, identify the mutations unique to it, and then — using the mRNA platform — write a bespoke instruction telling that patient’s own immune system exactly what to hunt.

A cancer vaccine, custom-printed per person.

That is not a chemistry pipeline.

That is software, run on biology.

And the stock? On such big news?

Skyrocketed!

Moderna closed up 177% on the day.

Fun fact: That was the largest single-day gain of any company in the S&P 500 this century (yes, this century).

The reason the market moved that violently is not the melanoma niche itself, which is relatively small. It is what melanoma proves: that the platform works beyond vaccines. If mRNA can teach the immune system to fight one cancer, the same machine points at lung cancer (a far larger indication, already in three Phase 3 trials), then kidney, then bladder.

So yes, if you think that’s big news, it is really big news.

One validated proof-of-concept, and suddenly the whole pipeline re-prices — because every future program shares the same platform. That is the difference between owning a product and owning a factory that can print products.

What happens next is a filing, an approval push likely into 2027, and readouts across those larger cancers. None of it is guaranteed — biology humbles everyone, and the failure rate we mentioned has not been repealed. But the question that hung over Moderna for three years — engine or one-hit wonder — just got answered in one direction (Chart 3).

But Moderna is a single ticker inside a far larger story - biotech. And a wonderful readout is not automatically a wonderful chart.

So, what does Mr. Market say to biotech in general?

Do we see anything of the AI beneficiary case?

Time for the «Good Chart».

Chart 3: Moderna weekly — the +177% single-day spike on the intismeran Phase 3 readout

Biotech’s «Good Chart»: The Longer the Base, the Higher the Space

Zoom out from the one stock to the whole neighbourhood.

Biotech had its own Covid boom — a frenzy in 2020–21 when every vaccine and every pipeline got a pandemic premium. Then came the bust. Too much future priced in too fast, and the sector spent roughly six years going nowhere: a long, grinding, sideways consolidation while the rest of the market ran.

Six years is a long time to be forgotten. It is also, in market terms, a long time to build a base.

In June we made exactly this call — that healthcare had struck back and its most aggressive corner was about to ignite, powered by the AI-in-biology tailwind. We laid out the whole space, and how to play it, in The Biotech Breakout, published on 25 June — exactly on the multi-year breakout. We have seen the action on the tape, and the ETF-Screener we built for you.

The index has since pushed through a ceiling that held for six years (Chart 4).

And that is the pattern worth internalising. A breakout to an all-time high, after years of frustration, is not the moment to fear heights — it is usually the opposite. The longer and tighter the consolidation, the more powerful what follows tends to be. These long bases rarely resolve in a single quick spike and a fade. Probabilistically, they mark the beginning of a new trend into a new sphere — not the end of the old one.

So how do you play a whole space rather than one lottery ticket?

Two ways.

The «haystack» approach: rather than picking the one needle, own the field via a broad biotech ETF and let the whole breakout carry you. We laid out exactly this in the Breakout piece.

And the «true leaders» approach: own the highest-quality businesses inside the space. As you know, we hold Medpace — the picks-and-shovels play that runs the clinical trials the entire industry depends on, getting paid whether any single drug wins or loses — and Eli Lilly, the compounding giant at the sweet spot of the whole health boom. Leaders and haystack, side by side.

Because here is where the three threads tie together. mRNA turned medicine into a message. AI turned that message into something you can design at scale. And a six-year base just broke to new highs at the exact moment both arrived.

The molecule is real. The machine to design it just showed up.

And we are still in the first innings.

The age of Biotech started.

So it begins.

Chart 4: iShares Biotechnology ETF (IBB) weekly — a six-year consolidation, then a breakout to new highs