The candidate is a combination of an mRNA therapeutic vaccine and Merck's cancer drug Keytruda

Moderna and Merck's first-of-its-kind cancer vaccine helped people with melanoma live longer in a late-stage trial, and shares of both companies are soaring.

The therapeutic vaccine, intismeran autogene, is an mRNA-based therapy that is paired with Merck's Keytruda, one of the world's top-selling cancer drugs. These are the first Phase 3 results for the closely watched experimental cancer vaccine, which works by training the immune system to identify certain mutations and then treating the cancer cells with Merck's immunotherapy.

Leerink Partners analyst Daina Graybosch described the findings as "historic" in a note to investors.

Moderna's stock (MRNA) soared about 93% at market open on Wednesday after nearly doubling in premarket trading. That is the stock's largest percent increase on record. Merck shares $(MRK)$ rallied 9%.

"These first Phase 3 findings for intismeran in combination with Keytruda as adjuvant therapy reinforce the promise of a more personalized approach to cancer treatment," Dean Li, president of Merck Research Laboratories, said in a statement. "We believe individualized neoantigen therapies have the potential to redefine how patients with completely resected stage IIB-IV melanoma are treated."

The companies did not release specific data showing the details about how the cancer vaccine performed in patients for the endpoints of preventing recurrence or the spread of the cancer. However, they said there were no new safety signals, and they plan to engage regulators to review the experimental cancer vaccine, which was tested against Keytruda alone in patients with an advanced form of melanoma.

"The strength of the underlying data must have been compelling to trigger significance at the interim analysis, meaningfully exceeding investor expectations," RBC Capital Markets analyst Trung Huynh told investors.

Some analysts believe the full data could be released as soon as October at a major cancer conference in Madrid.

Merck and Moderna are also testing the intismeran-Keytruda vaccine in combination with other cancer drugs and in different cancers. That this readout was positive is good news for the eight other Phase 2 and Phase 3 studies in this program, according to William Blair analyst Myles Minter. Analysts are waiting for a Phase 2 readout in renal-cell carcinoma that's expected later this year to see if the cancer vaccine works in other types of cancer.

The trial's success in meeting its primary and secondary endpoints also gives Moderna some breathing room. The biotech company has struggled to find its next major product after the blowout success of its COVID-19 vaccine. An approval for this vaccine in melanoma could bring in $2.5 billion in sales, according to one estimate.

"We believe Moderna has a clear line of sight to revenue diversification from the COVID business now," Minter wrote in an investor note, while upgrading the stock to buy.

Moderna's stock is now up 383% over the last year, while Merck's shares have gained 77%. Like many other drugmakers and biotechs, both companies have benefited from the investor rotation to healthcare and away from artificial-intelligence stocks. Merck's stock has hit six all-time highs this month.

BioNTech, which developed a mRNA-based COVID vaccine and is also developing mRNA-based therapeutics for cancer, is benefiting from Moderna's success. Shares of the biotech $(BNTX)$ jumped 24% on Wednesday morning.

-Jaimy Lee