(Bloomberg) -- Moderna Inc. said it aims to reduce its research and development budget by about 20% over the next three years as it tries to find a path to profitability following disappointing vaccine sales.

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The biotech is discontinuing five programs in its pipeline and slowing some late-stage studies of treatments for latent and rare diseases to achieve the $1.1 billion cut from its annual R&D budget by 2027, according to a statement Thursday.

The shares fell as much as 19% at the New York market open. They had lost 20% this year through Wednesday’s close.

The company’s revenue projection for next year was below what analysts expected and it announced it was pushing back its target to break even from 2026 to 2028. Questions remain about whether Moderna has enough cash to fund its plans to break even without raising additional equity, Jefferies analyst Michael Yee said in a note.

“Investors are unlikely to believe this until further credibility,” he said.

What Bloomberg Intelligence Says:

Uncertainty over Moderna’s revenue prospects explains the reduction in 2024-28 R&D spending to $20.8 billion (from $25 billion), with deprioritized assets not a major setback. As we expected, the FDA has discouraged filing mRNA-4157’s Phase II data in melanoma, with a later launch another risk to 2026-28 consensus sales.

— BI analyst Sam Fazeli. Reach the research here.

The Cambridge, Massachusetts-based company is slowing its pace of studying new treatments in part because of recent commercial challenges. The company sells two products — a vaccine for Covid and another for RSV. It projected sales of between $2.5 billion and $3.5 billion next year. It has said this year’s sales will range between $3 billion and $3.5 billion, down from its previous outlook of about $4 billion.

‘Financial Discipline’

“We are still dealing with a market of uncertainty,” Moderna Chief Financial Officer Jamey Mock said in an interview. “We hope that will settle out this year but we have to brace ourselves just in case vaccination rates continue to go down.”

Mock said the R&D cuts are a sign that the company “is exercising financial discipline.”

Moderna needed to reduce its R&D budget in part because its clinical trials have succeeded and later-stage studies require more funding, he said. Moderna expects 10 products to get approved over the next three years.