mRNA vaccine funding cuts: the impact on U.S. healthcare and biotech 

Funding cuts across healthcare have swept the U.S. along with layoffs, forcing several research projects to be terminated since the beginning of the year. Now, in the latest move, the U.S. healthcare agency HSS has announced that it will slash funding to mRNA vaccines, the technology that gained popularity for its ability to prevent COVID-19 as well as treat cancer. 

mRNA vaccine research loses $500 million in U.S. funding 

mRNA vaccine research will be stripped of $500 million in funding from the U.S. Department of Health and Human Services (HHS). The agency listed 22 projects that will be affected, many of which are being run by big pharma companies such as Pfizer and Moderna for vaccines against bird flu and other viruses. 

Moreover, the HHS has cancelled research proposals from Pfizer, Sanofi Pasteur, CSL Seqirus, and Gritstone, as well as ended contracts with Emory University in Georgia and Massachusetts-based Tiba Biotech. Emory University was previously awarded $24.8 million to advance mRNA technology to address infectious diseases, autoimmune conditions, and cancer in 2023. 

The projects, which are now under threat, were in collaboration with the Biomedical Advanced Research and Development Authority (BARDA), a part of the Administration for Strategic Preparedness and Response (ASPR) in the U.S. 

Vaccine skeptic Robert F. Kennedy Jr., who was appointed by U.S. President Donald Trump as the secretary of the HHS, is behind the mRNA funding cuts. Kennedy claims that these vaccines “fail to protect effectively against upper respiratory infections like COVID and flu.” Kennedy has frequently stated widely debunked claims about vaccine harm and about them being linked to autism, a neurodevelopmental disorder. 

While he announced that the HHS is shifting the funding toward “safer, broader vaccine platforms that remain effective even as viruses mutate,” now on the chopping block are mRNA vaccines, as he claims they do not work to treat and prevent diseases. 

Scientists and critics of the decision think otherwise. Jonathan Kagan, scientific cofounder of Massachusetts-based immunotherapeutics company Corner Therapeutics, believes that mRNA technology is, in fact, a breakthrough in vaccine research, and that progress must not be stalled. 

“mRNA represents a revolutionary technology, of similar significance to the discovery of recombinant DNA technologies,” said Kagan. 

He explained that while DNA technology led to the creation of numerous health innovations that drive society today, mRNA has similar potential, as it is the only technology that allows us to provide instructions to our cells.  

“Think of mRNA as an app on a cell phone, with the phone being our bodies. The mRNA allows us to create apps for our cells, which instruct our bodies to keep us healthy. When you have such control over cellular function, the possibilities for treatment of disease are limitless. The scientific community has spent decades building the tools to make them more precise, safer, and more adaptable. This work is far too valuable to abandon,” said Kagan. 

mRNA vaccines: the discovery, success, and pandemic panic 

Although messenger RNAs were discovered in the early 1960s and the way to deliver them into cells was developed in the 1970s, it was not until a few years ago that the field began to pick up pace, as drug developers raced to create vaccines against COVID-19. This led to the first-ever approval of Pfizer and BioNTech’s Comirnaty by the U.S. Food and Drug Administration (FDA) in 2021. 

Initially, developing these vaccines posed a challenge because they quickly degraded once they entered the body, before they could even deliver the RNA transcript that was supposed to be coded into proteins in the cells to instruct them to do a specific task. 

But this was solved with the advent of nanotechnology. So, in COVID-19 vaccines, mRNA is wrapped in a carrier called lipid nanoparticles that delivers them intact to cells, where they are then translated into proteins.  

Moreover, overcoming these challenges meant that mRNA vaccines could even potentially treat cancer. By encoding antigens such as tumor-associated antigens (TAAs), they can be delivered to immune cells, after which they trigger immune responses against cancer cells. 

Kagan thinks that if these vaccines were initially developed to address cancer instead, these funding cuts may not have even happened. And it’s because COVID-19 has been a hot button for global politics. 

“The biggest flaw of mRNA was that its first application was to COVID – the most politically charged disease in modern history. Many feel that the pandemic’s policy, public health, and communications challenges have led to where we are today: an exceptional medical breakthrough being viewed through the entirely wrong lens,” said Kagan. “If the first major mRNA application had been in cancer or autoimmune disease, it would be widely celebrated as a landmark achievement of science and not a political minefield.” 

Now, scientists and healthcare workers believe that medical research will face the brunt of these cuts.  

What is the impact of the mRNA vaccine funding cuts on healthcare and biotech? 

mRNA vaccines are reported to have prevented 14.4 million deaths from COVID-19 in a year, according to a research paper published in the National Library of Medicine in 2022. With these cuts curbing further research, Kagan pointed out that its impact is already being felt.  

“Funding cuts slow research and destabilize the entire biotech ecosystem,” he said. 

When public support disappears, it causes investors and pharma partners to rethink their exposure to certain platforms like mRNA. So, federal funding cuts could bring about a ripple effect where investors may pull out from spending money in the field as well.  

“We’ve seen a shift from long-term optimism to near-term caution, which is dangerous for an industry built on multi-year development cycles. We’re also on the brink of major breakthroughs in mRNA-based therapies for critical disease areas such as oncology – political instability puts these at risk,” said Kagan.  

As many young startups and universities rely on government funding to help translate their research into the clinic, the HHS decision puts these early-stage projects in jeopardy.  

“For startups and academic labs, it changes the entire equation. The absence of government support removes a critical bridge between discovery and translation. Projects that would have advanced into clinical development are now paused or shelved,” said Kagan. 

Besides, even though public funding doesn’t typically cover the full cost of a project, it sure gives a head start to beginning research in the first place. 

“For many, public funding was never about covering the full cost – it was about de-risking the earliest steps so that private capital could follow in the later stages,” said Kagan. 

Echoing Kagan’s thoughts, David Dodd, chief executive officer (CEO) of Georgia-based vaccine developer GeoVax Labs, explained that this sudden shift disrupts critical research and development (R&D) continuity for younger biotechs. 

“Programs in mid-development stages may be paused or abandoned, clinical trial momentum may be lost, and hiring and investment plans are now being reevaluated. More broadly, this creates uncertainty across the biotech ecosystem and undermines confidence in public-private partnerships that were the backbone of the COVID-19 response,” said Dodd. 

But Dodd believes that the way to get past this is to shift to more scalable technologies. 

“The era of single-antigen, single-variant response strategies is being reconsidered. Platforms that offer broader antigen coverage and proven safety across diverse populations – such as whole-virus and vector-based platforms – will likely see increased attention and investment,” said Dodd. 

Overcoming funding cuts: what can vaccine makers do? 

While this is a blow to the vaccine market, the funding cuts signal a shift away from a one-size-fits-all approach to pandemic response and from mRNA technology, which is currently an oversaturated field, according to Dodd. 

“This decision opens the door for diversification in the vaccine landscape. It reinforces the need for platforms that are adaptable, stable without extreme cold-chain requirements, and capable of inducing both humoral and cellular immunity. It also amplifies the urgency for domestic manufacturing capabilities and supply chain independence,” said Dodd, whose company, GeoVax, is developing vaccines derived from modified vaccinia Ankara, a weakened form of the vaccinia virus, against COVID-19.  

GeoVax was at the receiving end of federal funding cuts by BARDA in April. It had previously bagged the Project NextGen (PNG) award, part of a $5 billion initiative to boost pandemic preparedness. Funds were awarded to GeoVax to develop its COVID-19 vaccine GEO-CM04S1, presently in phase 2 trials, but were then axed by BARDA. 

Is shifting from mRNA technology the answer? 

Pivoting towards various other vaccine platforms could help mitigate the impact on healthcare, Dodd stated. 

“Relying solely on mRNA is no longer viable. Companies should pursue vaccine technologies that offer broader immunity, greater durability, and scalable manufacturing – such as viral vectors, protein subunits, and whole-virus inactivated platforms,” said Dodd. 

He added that engaging with regulators and policymakers early on could help too. He said: “Programs that align with U.S. health security priorities – such as multi-pathogen readiness, domestic production, and underserved population access – are more likely to receive sustained support.” 

Moreover, innovators can look for alternative funding sources. Organizations like CEPI, the Gates Foundation, and the Department of Defense (DoD) offer opportunities for vaccine R&D, and collaborating with non-governmental organizations can help bridge funding gaps, explained Dodd.  

“Ultimately, the current shake-up should drive the industry toward greater innovation, fiscal discipline, and scientific accountability.” 

Still, at present, the healthcare and biotech industry is reeling from the cuts, in what seems to be part of a broader clampdown on vaccine and infectious disease research. Kagan expressed that no technology can truly thrive without government support. 

“The scientific innovations of the last century in physics, medicine, math, and beyond enabled the development of the internet, cell phones, space travel, precision surgery, early diagnosis of disease, and more. There is no example of a society changing technology that did not have the support of the government. Who knows how many life-changing innovations have been lost because of governmental priority disconnects,” he said. 

As for younger biotechs and research labs focused on mRNA vaccine technology, looking for private funding and other grants could be the best way to keep innovation going – although not easy. 

“We’ll adapt, because we have to. Many companies, including ours, are leaning more heavily on private capital than ever before. But this shouldn’t be the new normal,” said Kagan. “The U.S. has led biotech innovation for decades by pairing academic science with government investment. If we abandon that model now, we will cede leadership to countries that are more willing to invest in the future.”