Vaccine makers saw their shares drop Monday following the release of an internal memo from Vinay Prasad, the FDA’s vaccine chief, in which he wrote that Covid-19 vaccines were linked to at least ten deaths in children.

The memo surfaced late Friday and indicated the agency is preparing potential new restrictions on vaccines for children.

By late morning, Moderna fell 6%, BioNTech declined 4.3%, Novavax dropped 4%, and Vaxcyte was down 6.6%.

“This is a profound revelation,” Prasad wrote.

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“For the first time, the US FDA will acknowledge that COVID-19 vaccines have killed American children.”

He added, “It is horrifying to consider that the US vaccine regulation, including our actions, may have harmed more children than we saved. This requires humility and introspection.”

The memo prompted responses from several Wall Street research desks, which warned clients that new regulatory requirements could pose a challenge for vaccine manufacturers.

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Myles R. Minter of William Blair, who rates Moderna “market perform,” told clients, “Our interpretation of the memo is that CBER will focus its efforts on the younger 12- to 24-year-old male population for newly approved Covid-19 vaccines where the myocarditis risk is highest.”

The note said that if new restrictions are implemented for that group, Moderna could face additional pressure on its Covid-19 franchise, along with negative sentiment generated by the memo and any follow-up actions.

Minter also said Pfizer, BioNTech, Novavax and Sanofi could be affected.

He added that the memo pointed to upcoming reforms to the CBER regulatory pathway, including a “demand” for pre-market randomized trials that assess clinical endpoints and not just immunogenicity for most new vaccine products.

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Mizuho’s Salim Syed, who rates PCVX “outperform,” told clients the memo indicated that pneumonia vaccine makers “will have to show their products reduce pneumonia (at least in the post-market setting), and not merely generate antibody titers.”

Syed said this requirement already reflects the current standard and does not represent a material change for Vaxcyte.

Cantor’s Carter Gould, who rates PCVX “overweight,” said the drop in Vaxcyte shares was not surprising “on the back of the return of perceived regulatory risk after a period of relative calm, particularly with key data weighted to late 2026.”

Gould noted that the memo language did not contain significant new concerns about pneumococcal vaccines.

He reminded investors that these developments should be evaluated alongside the likely timelines for VAX-31 adult and infant programs and “the time remaining in the current administration’s term.”

He added, “We appreciate that there’s plenty within the memo that’s controversial or worrisome regarding Covid-19 vaccine policy, but the actual language on PCVs shows little evolution vs. prior guidance.”

Leerink Partners analyst Mani Foroohar, who rates Moderna “underperform,” told clients that the “inflammatory tone” of the memo contributes to vaccine skepticism and declining vaccination rates in the United States.

“We view this as a continued negative for mRNA vaccine manufacturers in our coverage– especially as it relates to Moderna’s recently updated short-to-mid-term revenue guidance,” he said.

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The memo follows earlier statements from the Trump administration linking Covid-19 shots to deaths in children.

During the early stages of the pandemic, public criticism of the vaccines led to political clashes, including disputes over online censorship and what federal officials described as misinformation enforcement efforts.

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