Q2 2021 Moderna Inc Earnings Call

Good morning, and welcome to come with her in our second quarter earnings call. At this time all participants are in a listen only mode. Following the formal remarks, we will open the call up for your questions. Please be advised that the call is being recorded at this time I'll like to turn the call over to lavina for looks our head of Investor Relations.

Operator: and welcome to Moderna's second quarter earnings call. At this time, all participants are in a list-only mode.

Operator: Following the formal remarks, we will open the call up for your questions. Please be advised that the call is being recorded. At this time, I'd like to turn the call over to Levina Paluktar, head of investor relations at Moderna.

Lavina Talukdar: Thank you, operator. Good morning, everyone, and thank you for joining us on today's call to discuss Moderna's second quarter 2021 financial results and business update. You can access the press release issued this morning as well as the slides that we'll be reviewing by going to the investor section of our website. On today's call, our Stepan, our Chief Executive Officer, David Malene, our Chief Financial Officer, Stephen Hogue, our President,

Stephen Hoge, our President Paul Burton, our Chief Medical Officer, Corinne Mark off our Chief commercial Officer, and Jackie Miller, our senior Vice President therapeutic head of infectious diseases.

Paul Burton: Paul Burton, our chief medical officer, Krynne

Corinne LaGoff: Corinne LaGoff, our chief commercial officer, and Jackie Miller, our Senior Vice President, Therapeutic Head of Infectious Disease. Before we begin, please note that this conference call will include forward-looking statements made pursuant to the Safe Harbor provisions of the Private Litigation Reform Act of 1995. Please see slide two of the accompanying presentation and our SEC filings for important risk factors that could cause our performance and results to differ materially from those expressed or implied in these forward-looking statements.

Before we begin please note that this conference call will include forward looking statements made pursuant to the Safe Harbor provision of private litigation Reform Act of $19.95.

Please see slide 2 of the accompanying presentation and our SEC filings for important risk factors that could cause our performance and results to differ materially from those expressed or implied in these forward looking statements.

Corinne LaGoff: On slide three, please see the important indications and information for our COVID-19 vaccine, which has been authorized for emergency use in the United States and in many countries around the world. I will now turn the call over to step on.

On slide 3 please see the important indication and information for our COVID-19 vaccine, which has been authorized for emergency use in the United States and in many countries around the world.

I will now turn the call over to Stephane.

Stephan: Thank you, Labina. Good morning, good morning, everyone.

Thank you for that.

Good morning, or good afternoon, everyone.

Stephan: Welcome to our Q2, 2021 conference call. Today, I will start with a quick business review of the quarter before Corrine works you through the commercial update. David will present the key financial results.

Welcome to our Q2, 2021conference call.

I will start by quick business for view of a quarter before going walks you fool for commercial updates.

We presented a key funding source.

Stephan: Kevin and Jackie will provide a clinical update highlighting new human data about the final analysis for the COVID-19 vaccine phase-free co-study and human data for COVID-19 booster candidates phase two. I will then come back to close to share some thoughts about where we are heading. Let me start with the Modena COVID-19 vaccine or spike vaccine. We are pleased to announce today that our final analysis vaccine efficacy of EE in our phase-free co-study is holding very nicely at 93%.

Stephen and Jackie will provide the clinical update highlighting new human data for the final analysis for COVID-19 vaccine phase III study and human data for COVID-19, we spoke on the day to phase III.

We then come back to close to share some thoughts about where we're heading.

Let me start with Covid.

COVID-19 vaccine all sparkly box.

We are pleased to announce today that can find out of magazines vaccine efficacy Avi.

Phase III study is holding very nicely at 93%.

Stephan: We are starting to get authorizations for adolescent indications 12 to 17 years of age, receiving authorization in Japan this week, and a positive recommendation from the European Medicines Agency in July. An important step toward our vision of an annual respiratory combination booster is the start of phase one-two for MRN1010, which is a quadrivalent seasonal flu vaccine. Our teams are already preparing phase two for this program. We were delighted to get fast-track designation from the USFDA for our RZA vaccine candidate, MR 1345, in adults over 60 years of age.

We are starting to get authorizations for I'll do understand the indication for 2017 years of age.

Sitting authorization in Japan, This week and a positive recommendation for the European Medicines Agency in July.

An important step for Walmart vision of an annual respiratory combination boost to ease this talk of a phase 1.2 so I'm on page 10 cents, which is a quadrivalent seasonal flu vaccine.

Our teams are already preparing the phase II free for this for a while.

We were delighted to get fast track designation from the USA for the year for all of your vaccine candidates and wellness up to 45 in other.

Those over 60 years of age.

Stephan: There is no approved RSI vaccine. The burden of RISV infection is very high. In adults over 65 years of age, according to the CDC, 177,000 hospitalizations and around 14,000 deaths occur annually in the U.S. due to RASV.

There is no approved RSV vaccine the burden for RSV infection is very high.

Adults over 65 years of age.

For the CDC longer than 77000, hospitalizations and 14000 deaths annually in the U S due to RSV.

Stephan: Our teams are also preparing the phase two free for this program. Now, the Vicar vaccine has now moved to face. MRNA 3927 for propronic acidemia or PA, a rare genetic disease, has also started building patients in our phase one. And we are pleased to announce that we have started dosing healthy volunteers in our first autoimmune disease program, MRA 6231, coding for Ireland.

Our team is also preparing for phase II free for these for a while.

Well, if you come back to US now move to phase 2.

And my only 39.27 for propionic assay Damia appear where genetic disease has also started dosing patients in a phase 1 zone.

And we were pleased to announce with density that we started dosing healthy volunteers, Phil autoimmune disease program and non these 62 for Q1 coding for IL 2.

Stephan: So Moderna is now in the clinic in five large areas, infectious diseases, cancer, cardiology, autoimmune diseases, autoimmune diseases, and rare genetic diseases. We have a strong pipeline momentum, and their research teams are working hard to bring the next wave of development candidates to the Moving to Side- Moving to Side-C- We also have a strong commercial momentum. Let me start by giving you an update on advance purchase agreements, or APAs, for our COVID-19 vaccine spike.

Some other on that he's now in the clinic inspired blocks for a particular area you pictures he disease cancer called you're already doing.

<unk> disease and genetic diseases.

I have a strong pipeline momentum.

And there was sales teams are working hard to bring the next wave of development candidates.

Nick.

Moving to slide 6.

We have also a strong commercial momentum.

I'll start by giving you an update about advance purchase agreements for Aps.

For COVID-19 vaccine Spike box.

Stephan: For fiscal year 2021, we have now signed APAs for $20 billion versus 19.2 billion amounts in our Q1 call. We are now at capacity constraints for 2021, and we are not taking any more orders for 2021 delivery. For fiscal year 2022, we have already assigned APAs for 12 billion dollars. We have also signed an additional $8 billion in October. We are having numerous discussions ongoing as we speak with countries around the world to enter into new APs for 2020. We will continue to give you updates on a regular basis.

For fiscal year 2021, we have now signed Apu for 20 billion dollar, yes, $19.2 billion and now Q1 Covid.

We are not capacity constraint for 2021 and we're not taking any more all day also for 2021day anyway.

For fiscal year 2022, we have already assigned Apa's for 12 billion Laura Weil.

We've also signed an additional 8 billion the law in options.

We are having numerous discussions ongoing as we speak we've countries around the world Twin thing from your peers for 2022.

We'll continue to give you updates on a regular basis.

Stephan: What is very interesting to see is that forward-thinking countries like Israel and Switzerland have already signed APAs for 2023 to ensure supply for the endemic market. On the financial front, we delivered $4 billion of revenue and $2.8 billion of net income.

What is very interesting to see is that for a while I'm thinking countries like Israel, and Switzerland have already assigned EPS for 2020 free to ensure supply for the endemic market.

On the financial for all we did it for 4 billion of revenue and 2.8 billions at all of net income.

Stephan: The cash generation in the quarter was strong, at around $4 billion, bringing our cash balance to over $12 billion. We also announced today for the first share by-backer. Our board of directors has authorized the share we purchase for up to $1 billion, and I will give you more color in a few minutes. For 2021, we continue to forecast supply between 800 million and a billion doses. For 2022, we forecast supply between 2 to 3 billion doses, depending on the final dose approved by the regulators for a booster. At 50 micrograms, up to 3 billion doses; at 100 macogam, up to 2 billion doses.

For cash generation in the quarter was strong as well.

1.4 billion barrel bring.

Our cash balance to over $12 billion at the end of June.

We also seek to day, Phil share buyback plan.

For both of them direct sales as well.

Share repurchase for up to 1 billion.

David and I will give you more color in a few minutes.

But once you go in Q1, we continue to forecast supply between 800 million and the billion doses.

For 2022, we forecast supply between 2.2 for billions of those is depending.

Depending on the final dose approved by the regulator holds for a booster.

15, microgram up to 3 billion views.

1 other 1 microgram up to $2 billion.

Stephan: As we continue focusing on scaling the company, I am delighted to have three new executive committee members who join By Star Date at the company. Shannon Klinger is our chief legal officer and corporate secretary. She joined us from Novartis, where she was the chief legal officer. Paul Burton is our Chief Medical Officer. He joined us from Johnson Pharmaceuticals, a Johnson & Johnson Company, where he was Chief Global Medical Affairs Officer and, more recently, Kall Kronin, as a newly created role of chief brand officer. Kate was recently the CEO of Ogil. I look forward to working closely with Shannon, Paul, and Kate as well as with Kel Moderna to take it to the next level.

As we continue focusing on scaling the company.

Did you have for new Executive Committee members withdrawing recency.

Tal based on the company shutting non clean go as our Chief legal officer, and corporate Secretary. She joins us from Novartis, where she was the chief legal officer.

But for both of them at Chief Medical Officer, He joined US from Johnson Pharmaceuticals for jumped finally jumped from company, where he was chief global medical I fail for yourselves.

And most recently K Cronin as a newly created role of Chief Brian though for yourself.

Well I didn't think it was that he was CEO of I'll give you a hint.

I look for what we are working closely with Shandong, Poland, Kate as we scale them down now to the next level.

Stephan: On slide 9, you will find our usual summary slides, and a few important things to note. We are not preparing phase two free for quadrivalent seasonal flow and our RSV program. Our team continues to grow as we increase manufacturing capacity for COVID-19 vaccine, as we move the program from early stage clinical study to later stage clinical studies, and as we increase investment in research for the next wave of development candidates. Now, I will now turn to Corrin to give you a commercial update.

On slide 9 you will find our usual summary, slide for a few important things to note.

We are not for Repowering phase II free for quadrivalent seasonal flu.

And our RSV program.

Our team continues to grow as we increased manufacturing capacity for COVID-19 vaccine as we move program from early stage clinical study to late stage clinical studies and as we increase our investment in research for the next wave of development candidates do.

You May now turn for Cory to give you a commercial basis Cohen.

Corrin: Thank you, Stetsan, and good morning or good afternoon, everyone. I am happy to share the productive quarter the commercial organization had in the second quarter that continues into today, as we ramp up our efforts to supply the modern COVID-19 vaccine or spike bags to countries around the world. Let me start by recapping the advance purchase account.

Thank you Stefan and good morning, or good afternoon, everyone I am happy to share the productive quarter for the commercial organization that has had in the second quarter that continues into today as we ramp up our efforts to supply to Modena, COVID-19 vaccine or buybacks to countries around the world.

Let me start by recapping the advance purchases agreements that we have signed for delivery in 2021 on slide 11.

Corrin: agreements that we have signed for delivery in 2021 on slide 11, since the last quarterly call. I am very happy to highlight that we have signed APAs with Kovacs for 34 million.

Since the last quarterly call I am very happy to highlight that we have signed to Apa's with Colfax for 54 million doses. This year, an additional 110 million doses to the U S. G.

Corrin: 34 million doses this year, and an additional 110 million doses to the USG, bringing the total number of doses for the United States to about 400 million doses.

The total of doses for the United States to about 400 million doses.

Corrin: and 10 million doses to Australia for delivery in 2021.

And 10 million doses to Australia for delivery in 2021.

Corrin: In total, we anticipate up to 20%

In total we anticipate up to $20 billion in sales from these agreements as we deliver against them throughout the remainder of the year.

Corrin: billion dollars in sales from these agreements as we deliver

Corrin: against them throughout the remainder of the year. We are proud to distribute our vaccine directly or through

We are proud to distributor vaccine directly or through our network of partners across all continents, and most importantly to ensure access to our vaccine to all countries, regardless of their income level, notably through the kovacs facility structure.

Corrin: our network of partners across all continents and, most importantly, to ensure access

Corrin: to our vaccine to all countries, regardless of their income level, notably through the COVAX facility structure. I also want to mention that we are doing our utmost in supporting the US government to make the donations of Moderna doses of vaccines.

I also want to mention debt, we are doing our utmost to in supporting the U S government to execute the durations of Mcdonough doses of vaccines.

Corrin: Slide 12 lists out signed APIs for delivery in 2020.

Slide 12 lease out signed Apa's for deliveries in 2022, and even in 2023, the construct of the Aps signed for 'twenty, 2 and 'twenty 3 interest both confirmed orders as well as option to be triggered at a future date.

Corrin: and even in 202 and even in 2023. The construct of the APs signed for 22 and 202.

To date, we have already contracted for 22 product sales of $12 billion and an additional 8 billion in options.

Corrin: 23 include both confirmed orders as well as options to be triggered on a future day. To date, we have already contracted for 20.

Some of these Apis for primary CS vaccines, and others are for potential boosters in light of the possibility of needing booster vaccines to Inc to <unk>.

Corrin: product sales of $12 billion dollars and an additional $8 billion in options. Some of these APs are for

Increased immune responses against waning immunity and the emergence of variance of concern well then that has already started out our cooking booster strategy that Stephen will speak to shortly.

Corrin: Primary series vaccines and others offer

Corrin: for potential boosters, in light of the possibility of needing booster vaccines to increase immune responses against winning immunity and the emergence

In the meantime, the commercial team is currently engaged in multiple conversations that are gaining urgency as we watch the delta variant search and Mark been vaccinated populations.

Corrin: or variants of concern, Moderna has already started our COVID-booster strategy, which Stephen will speak about shortly.

Notably actively talking to many countries in South America in Asia and in the Middle East. All these countries are keenly interested in securing both primary series vaccines almost of vaccines for their citizens next year.

Corrin: In the meantime, the commercial team is currently engaged in multiple conversations that are gaining urgency as we watch the Delta variant surge among unvaccinated populations who are notably actively talking to many countries in South America, Asia, and the Middle East. All these countries are keenly interested in securing both primary series vaccines or booster vaccines for their citizens next year. In the United States, as you know, Moderna has initiated the ruling submission process for BADA approval and expects to complete its submission in August. This approval will represent an important milestone in achieving herd immunity, as it might help combat vaccine hesitancy. It will also allow the commercial organization to start preparing for the private U.S.

In the United States as you know within that has initiated the rolling submission process for BLA approval and expects to complete its submission in August. This approval represents an important milestone in achieving herd immunity as it might help combat fixing hesitancy.

It will also allow other commercial organization to start preparing for the private market.

Turning to slide 13, which refused sales breakout for the second quarter 'twenty 1.

Total product sales in the quarter were $4.2 billion, representing 199 million doses delivered in the quarter.

Sales in the U S with $2.1 billion, representing 126 million doses delivered to the U S government and sales for the rest of the world.

To the country that are listed on this slide we're also $2.1 billion, representing 73 billion doses delivered in the quarter.

Corrin: The sales breakout for the second quarter 21. Total product sales in the quarter were 4.

And with that let me hand, it over to David to take you through the financial details.

Corrin: $4.2 billion, representing 199 million doses delivered in the quarter. Sales in the US were $2.1 billion, representing 126 million doses delivered to the US government and sales to the rest of the world.

Okay. Thank you Corinne.

We are providing today the analysis of actual 2021 second quarter results along with an updated view of key drivers of financial performance going forward.

As in previous quarters, we are presenting our results primarily on the U S GAAP basis.

Corrin: to the country that are listed on the slide, were also present.

Corrin: were also $2.2, representing 73 million doses delivered in a quarter. And with that, I will hand it over to David to take you through the financial details.

Some cases, we also provide additional detail to provide greater clarity on underlying trends.

For now please to slide 15.

The transformation of <unk> from an R&D focused biotech to a commercial company, it's very apparent when reviewing our financial results.

David: Okay, thank you, Karat. We're providing today the analysis of actual 2021 second quarter results along with an updated view of key drivers of financial performance going forward. As in previous quarters, we're presenting our results primarily on a U.S. U.S.S. base. In some cases, we also provide additional detail to provide greater clarity on underlying trends. Turn now please to slide 15.

The comparison of the second quarter of 2021 for <unk>.

Our year is not as meaningful do draw a dynamic growth, which is why I will primarily focus on the quarter over quarter comparison relative to Q1 on the slide.

Total revenue was $4.4 billion in the second quarter of 2021 compared to $1.9 billion in Q1.

The increase of total revenue is primarily resulting from the sale of the company's COVID-19 vaccine.

David: The transformation of Moderna from an R&D-focused biotech to a commercial company is very apparent when reviewing our financial results. The comparison of the second quarter of 2021, the prior year, is not as meaningful due to dynamic growth, which is why I will primarily focus on the quarter over quarter comparison relative to Q1 on this slide. Total revenue was $4.

Product sales in Q2 were $4.2 billion compared to $1.7 billion in the first quarter, an increase of 142%.

Cost of sales were $750 million or 18% other company's products sales in the second quarter.

Compared to $193 million in the first quarter.

Research and development expenses were 421 million in Q2, 2021 compared to $401 million in Q1, and 152 million in the same periods in 2020.

David: in the second quarter of 2021 compared to $1.9 billion in Q1. The increase in total revenue is primarily resulting from the sale of the company's COVID-19 vaccine. Product sales in Q2 were 4.2 billion compared to 1.7 billion in the first quarter, an increase of 142%; cost of sales were 750 million or 18% of the company's product sales in the second quarter compared to 193 million in the first quarter.

The higher spend versus prior quarter and prior year was driven by increased COVID-19 vaccine clinical development activities, including our announced efforts around booster variants specific and multivalent vaccine candidates.

Selling general and administrative expenses were $121 million for Q2 compared to $77 million for the prior quarter.

The growth in spending was driven by commercialization of our COVID-19 vaccine globally with.

With the biggest increases being in personnel and outside services.

David: Research and development expenses were 421 million in Q2, compared to 401 million in Q1, and 152 million in Q1, and 152 million in the same period in 2020. The higher span versus prior quarter and prior year was driven by increased COVID-19 vaccine clinical development activities, including our announced efforts around booster, variant, specific, and multivalent vaccine candidates. Selling general and administrative expenses were 121 million for Q2 compared to 77 million for the prior quarter.

Provision for income taxes was $293 million in Q2 after $39 million in Q1, and an insignificant amount in the prior year.

Effective tax rate for Q2 was 9%.

Let me remind you of the following.

Significant investments to develop the M. RNA platform over the last decade resulted in a net operating loss carryforwards with the balance of $2.3 billion at the end of 2020.

As of December 31, we maintained a full valuation allowance against for deferred tax assets related to these loss carryforwards.

As discussed in our last call we started to release the valuation allowance. This year. The majority of the allowance will flow through the P&L over the course of this year through our effective tax rate prorated based on the cadence silver expected pretax quarterly earnings.

David: The growth in spending was driven by commercialization of our COVID-vacc vaccine globally, with the biggest increases being in personnel and outside service. Provision for income taxes was 283 million in Q2 after 39 million in Q1 and an insignificant amount in the prior year. Our effective tax rate for Q2 was 9%. Let me remind you of the following.

Over the course of 2021, the resulting nonrecurring benefit due.

Due to the release of the valuation allowance is about 5 percentage points on our effective tax rate.

Our Q2 effective tax rate was lower than the U S statutory rate, primarily due to the benefit related to the release of the valuation allowance.

Foreign derived intangible income deduction as well as a discrete item for excess tax deductions related to stock based compensation.

David: The significant investments to develop the MRNA platform over the last decade resulted in a net operating loss carry forward with a balance of 2.3 billion at the end of 2020. As of December 31, we maintained a full valuation allowance against our deferred tax assets related to these lost carry forwards. As discussed in our last call, we started to release the valuation allowance this year. The majority of the allowance will flow through the P&L over the course of this year through our effective tax rate, pro-rated based on the cadence of our expected pre-tax quarterly earnings.

We recorded net income of $2.8 billion in Q2 after $1.2 billion in Q1, an increase of 128%.

Diluted earnings per share for Q2 were $6.46.

Turning now to year to date financial results compared to prior year on slide 16.

Total revenue was $6.3 billion for the 6 months ended June 30, compared to $75 million for the same period in 2020.

For significant growth was driven by the sales of 302 million doses of the company's COVID-19 vaccine.

David: Over the course of 2021, the resulting non-recurring benefit due to the release of the valuation allowance is about 5 percentage points on our effective tax rate. Our Q2 effective tax rate was lower than the U.S. Statutory rate primarily due to the benefit related to the release of the valuation allowance, the foreign-derived intangible income deduction as well as a discrete item for excess tax deductions related to stock-based compensation.

Cost of sales was $943 million or 16% of the company's product sales for the 6 months ended June 30th.

Including third party royalties of $232 million.

Reported cost of sales was reduced by 3 percentage points to the consumption of previously expensed inventory of approximately $200 million.

Research and development expenses were $822 million for the 6 months ended June 30, as compared to $267 million for the same period in 2020.

David: We recorded net income of 2.8 billion in Q2 after 1.2 billion in Q1, an increase of 128%. Unaudited earnings per share for Q2 were $6. Turning now to year-to-date financial results compared to the prior year, on slide 16th. Total revenue was 6.3 billion for the six months ended June 30th, compared to 75 million for the same period in 2020. The significant growth was driven by the sales of 302 million doses of the company's COVID-19 vaccine.

Growth in spending in 'twenty, 1 was largely driven by increased mrna 12, 73 clinical development and head count.

Selling general and administrative expenses were $198 million for the 6 months ended June 30th.

Per the $61 million for the same period in 2020.

The growth in spending in 2021 was mainly attributable to the company's COVID-19 vaccine commercialization activities.

David: Cost of sales was 943 million or 16% with the company's product sales for the six months end of June 30th, including third-party royalties of $232 million, reported cost of sales was reduced by three percentage points due to the of previously expensed inventory of approximately $200, Research and development expenses were $822 million for the six months end of June 30th, compared to $267 million for the same period in 2020, growth in spending in 21 was largely driven by increased MRN-1273 clinical development and headcount, selling general and administrative expenses were $198 million for the six months ended June 30th, compared to $61 million for the same period in 2020. The growth in spending in 2021 was mainly attributable to the company's COVID-19 vaccine commercialization activities.

For the 6 months ended June 30th we recorded provision for income taxes of $322 million compared to an insignificant amount for the period in 2020.

Our effective tax rate for the 6 months ended June 30th was 7% it.

It was lower than the U S statutory rate, primarily due to the nonrecurring benefit related to the release of a valuation allowance.

Ongoing benefit of the foreign derived intangible income deduction as well as a discrete item for excess tax deductions related to stock based compensation.

Net income was 4 billion for the 6 months ended June 30th compared to a net loss of $241 million for the same period in 2020.

Diluted earnings per share were $9.30 for the 6 months ended June 32021.

Turning to cash in selected cash flow information on slide 17.

We ended Q2 with cash and investments of $12.2 billion compared to $8.2 billion at the end of Q1 the.

David: For the six months ended June 30th, we recorded provision for income taxes of 32 million compared to an insignificant amount for the period in 2020. Our effective tax rate for the six months ended June 30th was 7%, which was lower than the U.

The increase was driven by our commercial sales and additional customer deposits received in the second quarter for future purchases of our COVID-19 vaccine.

Net cash provided by operating activities was for $1 billion in Q2 after 3 billion in Q1.

David: The U.S. Statutory rate is primarily due to the non-recurring benefit related to the release of the valuation allowance, the ongoing benefit of the foreign derived intangible income deduction, as well as a discrete item for excess tax deductions related to stock-based compensation. That income was $4 billion for the six months ending on June 30th, compared to a net loss of $241 million for the same period in 2020. The loot and earnings per share were $9.

Totaling them 7 billion year per day.

This compares to net cash used in operating activities of $130 million in the prior year.

Cash used for purchase of property and equipment was $65 million for the 6 months ended June 30th compared to $25 million for the same periods in 2020.

Similar to last quarter before providing an updated financial framework for the remainder of 2021.

Let me point out a few areas that are important to keep in mind when modeling expected 21.

David: For the six months ending on June 30th, 2021. Turning to Cash and selected cash flow information on slide 17. We ended Q2 with cash and investments of $12.2 billion, compared to $8.2 billion at the end of Q1. The increase is driven by commercial sales and additional customer deposits received in the second quarter for future purchases of our COVID-19 vaccine. Net cash provided by operating activities was 4.1 billion in Q2 after 3 billion in Q1, totaling then 7 billion a year today.

Actual performance.

Starting with cost of sales on slide 18.

Cost of sales includes the cost of goods manufactured third party royalties as well as logistics and warehousing costs. As you may recall, we began capitalizing or COVID-19 vaccine inventory cost in December 2020, following emergency use authorization.

Prior to the authorization inventory costs were recorded as research and development expenses in the period incurred.

In Q1 zero cost inventory balance of $140.184 million was sold and benefit total cost of sales.

David: This compares to net cash used in operating activities of $130 million in the prior year. Cash used for the purchase of property and equipment was $65 million for the six months ended June 30th compared to $25 million for the same period in 2020, similar to last quarter Before providing an updated financial framework for the remainder of 2021, let me point out a few areas that are important to keep in mind when modeling expected 21 financial performance, starting with cost of sales on slide 18. The cost of sales includes the cost of goods manufactured, third-party royalties, as well as logistics and warehousing costs.

Inventories sold during the first quarter was value that actual cost our cost of sales would have been $377 million or 22% of product sales.

In Q2 cost of sales of $750 million or 18% of product sales were no longer materially impacted but the zero cost inventory, hence the relevant comparison is the <unk>.

Adjusted ratio in Q1.

The reduction of cost of sales as a percent of product sales when comparing to the adjusted cost of sales in Q1 is primarily driven by our customer mix driven increase in our average selling price during the second quarter.

David: As you may recall, we began capitalizing our COVID-19 vaccine inventory costs in December 2020 following emergency use authorization. Prior to the emergency use authorization, inventory costs were recorded as research and development expenses in the period incurred. In Q1, a zero-cost inventory balance of $184 million was sold and benefited her cost of sale. If inventory sold during the first quarter had been valued at actual cost, our cost of sales would have been $377 million, or 22% of product sales.

Now turning to our cash and investment position on slide 19.

Cash and investment balance reported as of June 30 was $12.2 billion up from $8.2 billion as of March 31.

The increase was driven by our commercial activities, including net increase in customer deposits for future products supply a COVID-19 vaccine.

The net cash balance of customer deposits increased from $5.6 billion at the end of Q1 to $6.8 billion as of June 30.

Turning to slide 20.

David: In Q2, cost of sales of 750 million, or 18% of product sales, were no longer materially impacted by the zero-cost inventory; hence, the relevant comparison is the adjusted ratio in Q1. The reduction of cost of sales as a percent of product sales when compared to the adjusted cost of sales in Q1 is primarily driven by a customer-mix driven increase in our average selling price during the second quarter.

I wanted to share or kept guerilla capital allocation priorities.

Seek to optimize our capital deployment and maximize long term shareholder returns are.

Our top investment priority will continue to be reinvesting in the base business across multiple areas.

For R&D, we have more than tripled to spending in the first half of 2021 relative to the prior year and we will continue to significantly increase spending in this area to advance and accelerate our pipeline.

For manufacturing, we previously disclosed our 2020, 1 capital expenditure plans, which will allow us to increase our production capacity.

David: Now turning to our cash and investment position on slide 19. The cash and investment balance reported as of June 30th was 12.2 billion, up from 8.2 billion as of March 31. The increase is driven by our commercial activities, including a net increase in customer deposits for future product supply of COVID-19 vaccines. The net cash balance of customer deposits increased from 5.6 billion at the end of Q1 to 6.8 billion as of June 30th. Turning to slide 20.

Additionally, we are investing heavily in digital automation and AI as well as scaling up our global commercial operations, which will allow us to maximize the impact over RNA platform.

Our second investment priorities to seek attractive external investment and collaboration opportunities to further expand the reach of <unk> technology and capabilities, we were considering attractive strategic opportunities that enable and complement our platform and take a disciplined approach in evaluating.

David: I wanted to share our capital allocation priority. We seek to optimize our capital deployment and maximize long-term shareholder returns. Our top investment priority will continue to be reinvesting in the base business across multiple areas. For R&D, we have more than tripled spending in the first half of 2021 relative to the prior year, and we will continue to significantly increase spending in this area to advance and accelerate our pipeline. For manufacturing, we previously disclosed our 2021 capital expenditure plans, which will allow us to increase our production capacity.

Potential outside investments.

After evaluating internal and external investment opportunities. We then assess additional uses of cash.

Part of today's press release, we announced that the board has authorized a $1 billion share repurchase program.

Program is authorized for 2 year period.

Based on the strength of our financial results for the first half for the year and our confidence in our business outlook. We believe it is an appropriate time to initiate this program.

Turning now to the 2021 updated financial framework on slide 21.

Signed advanced purchase agreements for expected delivery in 2021 reflect the current full year total of approximately 20 billion and anticipated product sales included the $5.9 billion of product sales already generated in the first half of this year.

David: Additionally, we're investing heavily in digital, automation, and AI, as well as scaling up our global commercial operations, which will allow us to maximize the impact of our MRN platform. Our second investment priority is to seek attractive external investment and collaboration opportunities to further expand the reach of modernist technology and capabilities. We are considering attractive strategic opportunities that enable and complement our platform and take a disciplined approach to evaluating potential outside investments. After evaluating internal and external investment opportunities, we then assess additional uses of cash.

For the full year, we continue to expect a minimum supply of 800 million doses up to 100 microgram dose level are.

Our manufacturing team and our partners continue working to supply up to 1 billion doses for 2021.

We have signed advance purchase agreements for expected delivery in 2022 for total product sales of approximately $12 billion and options for an additional $8 billion.

Numerous additional negotiations are still ongoing for 2022 ipos.

David: As part of today's press release, we announce that the board has been authorized a $1 billion share repurchase program. This program is authorized for a two-year period. Based on the strength of our financial results for the first half of the year and our confidence in our business outlook, we believe it is an appropriate time to initiate this program. Turning now to the 2021 updated financial framework on slide 21, signed advance purchase agreements for expected delivery in 2021 reflect a current full year total of approximately 20 billion anticipated product sales, including the 5.9 billion of product sales already generated in the first half of this year. For the full year, we continue to expect a minimum supply of 800 million doses at the 100 microgram dose level.

We have also started to sign Apa's for 'twenty 'twenty 3.

As we previously announced we continue to make investments to increase our supply of vaccine, including by working with contract manufacturing organizations. We currently anticipate other supply could be as high as 3 billion doses for 2022, if our sales are primarily out of 50 microgram dose level.

If sales are primarily up the 100 microgram dose level, we anticipate that supply will be approximately up to 2 billion doses.

The ultimate approach on dosage levels for 2022, and where we might end up in that range is subject to ongoing internal review as well as discussions with regulators and customers and will also be impacted by the mix of primary and booster series.

David: Our manufacturing team and our partners continue working to supply up to 1 billion doses for 2021. We have signed advanced purchase agreements for expected delivery in 2022 for total product sales of approximately 12 billion and options for an additional 8. Numerous additional negotiations are still ongoing for 2022 APA. We have also started to sign APAs for 2023.

Our total cost of sales includes the cost of goods manufactured third party royalties as well as logistics and warehousing costs.

For 2021.

We now expect the average cost.

Total of sales as a percent of product sales to be between 18% to 20% compared to our previous outlook of approximately 20% of product sales. This reflects the successful ramp up of this global manufacturing network.

With regard to planned R&D and SG&A expenses Q2 expenses of approximately $542 million reflect the quarter over quarter increase of 13% in line with the outlook we gave in Q1.

David: As we previously announced, we continue to make investments to increase our supply of vaccine, including by working with contract manufacturing organizations. We currently anticipate that our supply could be as high as 3 billion doses for 2022 if our sales are primarily at a 50 microgram dose level. If sales are primarily at the 100 microgram dose level, we anticipate that supply will be approximately up to 2 billion doses. The ultimate approach on dosage levels for 2022 and where we might end up in that range is subject to ongoing internal review, as well as discussions with regulators and customers, and will also be impacted by the mix of primary and booster series. Our total cost of sales includes the cost of goods manufactured, third-party royalties, as well as logistics and warehousing costs. 2021.

We continue to plan for an increase on a quarter over quarter basis for the remainder of this year and expect this growth rate to accelerate as the business rapidly expands.

Based on further increased visibility of the utilization of our accumulated net operating loss carryforward expected global sales mix and the mentioned discrete benefits in the first half of this year. We now expect our all in 2021 tax rate to be approximately 10%.

This compares to our previous forecast in the low teen range.

This forecast is based on current U S tax policy and does not include any future potential discrete benefits related to stock based compensation.

Finally regarding capital investments, we maintained our forecast for a range of $450 million to $550 million, including the planned capacity expansion investments.

David: We now expect the average cost, total of sales as a percent of product sales to be between 18 to 20 percent compared to our previous outlook of approximately 20 percent of product sales. This reflects the successful ramp-up of this global manufacturing network. With regard to planned R&S&SG&A expenses, Q2 expenses of approximately 542 million reflect a quarter over quarter increase of 13% in line with the outlook we gave in Q1. We continue to plan for an increase on a quarter over quarter basis for the remainder of this year and expect this growth rate to accelerate as the business rapidly expands.

On April 29 of this year.

This concludes my remarks, and I turn the call over to Jacky Miller.

Yes. Good morning. Good afternoon, everyone. My name is Jacqueline Miller and I lead the therapeutic area for infectious diseases and it's my pleasure today to give you an update to.

For the ongoing accumulation of data in our phase III clinical study and also to talk about some of the publications of real world evidence that have occurred outside of China with the use of our COVID-19 vaccine.

So on slide 24.

You'll see the top line updates to our Cove efficacy trial and these are efficacy data that have now been followed 3 or 4 to 6 months. After subjects received their second vaccination.

David: Based on further increased visibility of the utilization of our accumulated net operating loss carry forward, expected global sales mix, and the mentioned discrete benefits in the first half of this year, we now expect our all-in 2021 tax rate to be approximately 10%. This compares to our previous forecast in the low teen range. This forecast is based on current U.S. tax policy and does not include any future potential discrete benefits related to stock-based compensation.

Other.

Rene 12, 73 or placebo.

Call that at the time of our EUA submission are.

Mary efficacy analysis demonstrated efficacy to COVID-19 of 94, 1% now for 6 months.

After a second dose we see them.

Maintenance of that efficacy of 93, 2% with a lower limit of the 95% confidence interval of 91%.

We continue to maintain efficacy against severe COVID-19 disease with updated vaccine efficacy of 98, 2% and currently have 100% of efficacy against deaths caused by COVID-19. So unfortunately, there were 3 debt.

David: Finally, regarding capital investments, we maintain our forecast for a range of 450 to 550 million, including the planned capacity expansion investments as announced on April 29th of this year. This concludes my remarks, and I turn the call over to Jackie Miller.

In the placebo group and up till now non in the mrna 12.73, great.

We continue to see consistency in our subgroup analyses, including analyses by gender by race and by preexisting medical condition.

Our safety profile.

Continues to be consistent with the phase III data over the longer period of safety follow up and also continues to be consistent across population subgroups.

Jacqueline Miller: Yes, good morning, and good afternoon, everyone. My name is Jacqueline Miller, and I lead the therapeutic area for infectious diseases. And it's my pleasure today to give you an update on the ongoing accumulation of data in our Phase 3 clinical study.

Next slide please on slide 25.

You'll see the efficacy data broken out.

By time interval.

So what you see at the top of the table is the overall efficacy. We just discussed according to the primary end point, we start measuring vaccine efficacy at 14 days after dose 2 and again, that's 93, 1%.

Jacqueline Miller: and also to talk about some of the publications of real-world evidence that have occurred outside of Moderna with the use of our COVID-19 vaccine.

Jacqueline Miller: So on slide 24, you'll see the top-up update.

If you look between 14 days post dose 2 to less than 2 months. After dose 2 we observed vaccine efficacy of 91.8 per cent and 94%. If you look 2 months after dose 2 to less than 4 months after dose too and.

Jacqueline Miller: to our Coveefficacy trial. These are efficacy data that have now been followed through four to six months after subjects received their second vaccination of either MRNA 1273 or placebo. Recall that at the time of our EUA submission, our primary efficacy,

And finally greater than 4 months after dose 2 we observed 92, 4% efficacy.

And the conclusion, we take from these data is that our efficacy has remained consistently high and durable throughout the period of follow up and we intend to continue to follow these data now that the trial is in its open label phase the reports will be different moving forward given.

Jacqueline Miller: Analysis demonstrated efficacy of COVID-COVID-

Jacqueline Miller: of 94.1%. Now, four to six months after the second dose, we see a maintenance of that efficacy of 93.2% with a lower limit of the 95% confidence confidence interval of 91%. We continue to maintain efficacy against severe COVID-19.

Jacqueline Miller: disease with an updated vaccine efficacy of 98.2% and currently has 100% of efficacy against death,

Jacqueline Miller: caused by COVID-19. So unfortunately, there were three deaths in the placebo group and, up till now, none in the MRN-1273 group. We continue to see consistency in our subgroup analyses, including this analysis.

Jacqueline Miller: including analyses by gender, by race, and by pre-existing medical conditions.

Jacqueline Miller: Our safety profile continues to be consistent with the phase three data over the longer period of safety follow-up and also continues to be consistent.

Jacqueline Miller: consistent across population subgroups. Next slide, on slide, on slide 25.

2 moving on to slide 28, I want to start with an update of our perspective on COVID-19, and how it's impacting our strategy for boosters.

Jacqueline Miller: You'll see the efficacy data broken out by time interval. What you see at the top of the table is the overall efficacy we just discussed. According to the primary endpoints, we start measuring vaccine efficacy at 14 days after you.

So first of all emerging perspective.

We believe today that the increased force of infection, that's resulting from the Delta variant uhm fatigue with non pharmaceutical interventions and the seasonal effects of moving indoors will eventually lead to an increase in breakthrough infections and vaccinated individuals in fact, there have been reports of that already.

Jacqueline Miller: dose to and again, that's 93. If you look between 14 days post-dose 2 and less than two months after dose 2, we observe vaccine efficacy of 91.8% and 94% if you look at

While we see durable phase 3 efficacy through 6 months, which Jackie just described we do expect that neutralizing titers will continue to wane and eventually that will impact vaccine efficacy. So given this intersection between arising for 7 infection and winning immunity. We believe a dose 3 have a booster Melissa.

Jacqueline Miller: if you look two months after the dose two to less than four months after

Jacqueline Miller: And finally, greater than four months after dose two, we observed

Jacqueline Miller: We observed 92.4%

Jacqueline Miller: The conclusion we take from these data is that our efficacy has remained consistently high and durable throughout the period of follow-up. And we intend to continue to follow these data now that the trial is in its open-label phase. However, the reports will be different moving forward, given that subjects in the placebo group have recently been vaccinated.

<unk> be necessary to keep us as safe as possible through the winter season Northern hemisphere.

So how does that informed our booster strategy for primary approach since early this year has been to advance a portfolio of booster candidates against all of the potential emerging variance of concern and so we have a large number of ongoing clinical studies and I'll provide some update on some today.

Jacqueline Miller: but we think it's important that we continue to follow as subjects remain further out.

Those boosters are being evaluated often at 2 different dose levels 50, micrograms and 100 micrograms.

Jacqueline Miller: from their initial vaccination. So if you go to slide 26, you'll see that these data have also been consistent in studies outside.

And they fall broadly into 3 categories and first is our prototype vaccine or morning, 12, 73 for which Jackie just describe the primary efficacy data out of our Faith Street study.

Jacqueline Miller: of the Moderna clinical trial.

Jacqueline Miller: So we can begin to see real-world effectiveness data that

Second we were looking at variance specific booster candidates beta and now a new delta variance specific candidate and.

Jacqueline Miller: demonstrate that Moderna maintains effectiveness consistent with what was seen in the Cove study. There are reports from Canada, from the United Kingdom, and from Qatar, and importantly, these trials confirm that there is vaccine effectiveness not only against the Wuhan strain, but also against emerging variants of concern, including the alpha, beta, gamma, and delta variance, and this is even after partial vaccination or vaccination with a single dose.

And third we were looking at a multi valent platform combining different variance into a single vaccine first R. <unk> 211 program and now a new era morning, 2 and 3 program, which includes the Delta antigen. The goal of the multi valent platform is to continue to try and stay ahead of where the viruses going by combining.

Finding different antigens against emerging turns of concern.

So I'd like to provide a brief update today on the 3 pre existing programs and more than a 12.73 or variance specific booster candidate against the beta string 351, and our first multi valence vaccine 211.

Jacqueline Miller: So if you move to slide 27, I'm now going to

Jacqueline Miller: I will hand over the presentation to Stephen Hogue, who will review our COVID-19 boost

Moving to slide 29, I have a comparison of those 3 candidates from our phase 2 O..1 study.

So quickly starting on the left hand side looking in the validated clinical assays needs are the same as it is conducted by our collaborators at NIH that were used for our phase 3 study in earlier clinical work. We can look at the wild type virus neutralization of the 3 different booster approaches.

Jacqueline Miller: Booster strategy and clinical data as well as a review of our pipeline.

Stephen Hoge: Steven? Thank you, Jackie. Moving on to slide 28, I want to start with an update on our perspective on COVID-19 and how it's impacting our strategy for boosters. So first, our emerging perspective. We believe today that the increased force of infection that's resulting from the Delta variant, fatigue with non-pharmaceutical interventions, and the seasonal effects of moving indoors will eventually lead to an increase in breakthrough infections in vaccinated individuals. In fact, there have been reports of that already.

<unk> left or right you see our prototype 12.73 or beta specific variant of concern 12, 73, <unk> 351, and the multi valent combination of 12, 73, and beta which is M. Marnie 12, 70.3211 as a reminder, all 3 of these weirdoes at 50 micrograms, and what I'm showing you on the left hand.

Inside is a pseudo virus neutralization titers in the validated assays at day, 1 immediately prior to boosting day 29 and in the in some cases day 15.

Stephen Hoge: While we see durable phase three efficacy through six months, as Jackie just described, we do expect that neutralizing titers will continue to wane, and eventually, that will impact vaccine efforts. So given this intersection between a rising force of infection and waning immunity, we believe a dose three of the booster will likely be necessary to keep us as safe as possible through the winter season in the northern hemisphere. So how has that informed our booster strategy?

Now all of the participants in this study were previously received the Moderna vaccine 2 doses just as with Jackie had described and at approximately 6 to 8 months. After they had participated in 1 of our clinical studies, we offer them a chance for this booster so.

So you can see at the baseline day, 1.6 to 8 months. After primary series neutralizing titers are somewhat lower in all 3 cases.

Stephen Hoge: Well, our primary approach, since early this year, has been to advance the portfolio of booster candidates against all of the potential emerging variances of concern. And so we have a large number of ongoing clinical studies, and I'll provide some updates on some today. Those boosters are being evaluated often at two different dose levels, 50 micrograms and 100,000. And they fall broadly into three categories.

With a booster dose of vaccine all 3 boosters, we were able to substantially increase the neutralization against the wall type hours as you can see for 12.70 316.7 fold approximately 11 fold. The both the day 15, and a 29 for the beta variant of concern.

38 to 46 fold within the 211 multi valent platform.

So that's against the ancestral virus on the left how do we do against the very for concern.

Stephen Hoge: First, is our prototype vaccine, and we're on a 1273 for which Jackie just described the primary efficacy data from our phase three study. Second, we are looking at variant-specific booster candidates, beta, and now a new Delta variant-specific candidate. And third, we are looking at a multivalent platform, combining different variants into a single vaccine, first our MR211 program and now a new MRN213 program, which includes the Delta Antis. The goal of the multivalent platform is to continue to try and stay ahead of where the virus is going by combining different antigens against emerging variants of concern.

For the time when we initiated this study we were particularly concerned about the B 1351 variant that now it's named Beta version and the P. Juan Gamma version and what we did is we set up assays to evaluate the performance of the booster vaccines 2 weeks after booster in all of those and again compare it against the ancestral virus.

The 614 G that we've used elsewhere.

What you can see.

In all 3 cases is when you compare the boosting that's happening and compare that to the level of titers neutralizing titers that was seen in each of those groups of people against their for 2 months 1 month post their second dose you can see strong boosting against all the very.

Stephen Hoge: So I'd like to provide a brief update today on the three pre-existing programs, MRA-1273, our variant-specific booster candidate against the beta strain 351 and our first multi-valent vaccine, 211. Moving to slide 29, I have a comparison of those three candidates from our Phase 201 study. So quickly, starting on the left-hand side, looking at the validated clinical assays, these are the same assays conducted by our collaborators at NIH that were used for our phase three study and earlier clinical work.

It's a concern by all 3 booster strategies in fact, it's very encouraging to see that 12.73 or prototype vaccine was able to <unk> increased titers against the 351 stream and the P..1 demonstrating.

Now as you look for the last you'll see the level of boosting might be slightly higher with our multivalent platform.

Which is directionally higher titers, particularly against the 351 M. P..1 strain, but overall the boosting remained strong across all 3 <unk> all all 3 approaches.

Stephen Hoge: We can look at the wild-type virus neutralization of the three different booster approaches. Arrayed left to right, you see our prototype 1273, our beta-specific variant of concern, 1273, and the multivalent combination of 1273 and beta, which is MRNA 1273211.

And as a result of this data we've made the determination that against these variance of concern. We believe the prototype vaccine mrna 12, 73 is more than sufficient as a booster and if there's no obvious advantage to working with the beta including very Imposters. At this time, it's also worth noting that the epidemiology is.

Moved away from the very 8 a very in a concern towards the delta during a concern that we should have spoken about extensively.

So how do we do then in that 12.73 against the belt Delta during a concern.

Stephen Hoge: As a reminder, all three of these were dosed at 50 microstrere. And what I'm showing you on the left-hand side are the pseudovirus neutralization titers in the validated assays at day one, immediately prior to boosting, day 29, and in some cases, day 15. Now, all of the participants in this study had previously received the Moderna vaccine two doses, just as Jackie had described. And at approximately six to eight months after they had participated in one of our clinical studies, we offered them a chance to do so. So you can see at baseline day one, six to eight months after the primary series, neutralizing titers are somewhat lower in all three cases.

Moving to slide 30.

I'm presenting day to here, which has been submitted for.

For in a manuscript it's actually impressed as we speak looking at the performance of 12.73 over 6 months after primary series against the <unk> the various a concern.

The third dose booster at 50, Micromet 12, 73 suite of hours neutralization titers here in our research assays for shown.

And just to Orange you quickly to the slide we're looking against wildlife Beta Gamma and Delta variance are concerned.

The data on the first 3 columns deals with the month, 1 posted does too. So immediately following the primary vaccination series for which we have the really strong efficacy data. The Jackie just described and as you can see we see high titers against the wild type strength 1200 in this as a group and substantially.

Stephen Hoge: With a booster dose of vaccine, all three boosters, we were able to substantially increase the neutralization against the wild type virus. As you can see, for 1273, 16.7 fold, approximately 11 fold, both day 15 and day 29 for the beta variant of concern, and 38 to 46 fold with the 211 multi-valent platform. So that's against the ancestral virus on the left. How do we do against the variance of concerns?

Lower titers against the beta and gamma variance of concern as as previously been reported.

Following those subjects forward to months 6 to 8 after their second dose. What you can see is waning both for the wild type virus, although it remains detectable levels of titers, but also for the variance of concern, particularly beta gamma and Delta in fact as you can appreciate in those middle for bars.

Stephen Hoge: At the time when we initiated this study, we were particularly concerned about the B-3-1 variant, now named the Beta variant, and the P1 Gamma. And what we did is we set up assays to evaluate the performance of the booster vaccines, two weeks after the booster, in all of those, and again, compared it against the ancestral virus. 6144G that we've used to, what you can see in all three cases is when you compare the boosting that's happening and compare that level of titers, neutralizing tiders, that was seen in each of those groups of people against their two months, one month post their second, you can see strong boosting against all the variance of concern by all three booster strategies.

Beta gamma and Delta neutralizing titers had fallen below the detectable the level of detection of the assay for a decent number of participants in old for all 3 cases.

Now the Great news is that a 50 microgram doses in the morning, 12, 73 was able to boost against all 4 of those viral strength and 14 days post goes 3 we show the titers on alright again all for bars.

We saw twenty-three for boosting against the wall type strength to levels that are significantly about the level. We've seen just add just after a second dose 1 month postcodes too.

So a 32 full boosting against beta forty-three for boosting against Gamma and 42 fold boosting against Delta again, all reaching levels uhm that are significantly higher than previously seen and that is very encouraging and we think confirms our selection of the prototype booster as.

Stephen Hoge: In fact, it's very encouraging to see that 1273, our prototype vaccine, was able to increase titers against the 351 strain and the P1 gamma strain. Now, as you look to the left, you'll see the level of boosting might be slightly higher with our multivalent platform, which is directionally higher titers, particularly against the 351 and P1 strains. But overall, the boosting remains strong across all three variants of all three approaches.

I'd likely to be protective against the circulating variance of concern, particularly delta presently.

So advancing that I'm already 12, 73 program at 50 microphone booster interface to something we did in parallel and slide 31, I'm happy to provide an update on the phase 2 results from that larger a.

Stephen Hoge: And as a result of this data, we've made the determination that against these variants of concern, we believe the prototype vaccine, MRNA, 273, is more than sufficient as a booster and that there's no obvious advantage to working with the beta-containing variants at this time. It's also worth noting that the epidemiology has moved away from the very beta variant of concern towards the delta variant of concern that we've spoken about expenses. So how did we do then in that 1273 against the Delta variant of concern? Moving to slide 30.

A study of the prototype booster.

Earlier this year.

Our phase 2 study of a morning 12, 73 was amended to offer a third dose of 12.73 at 50 micrograms to all interested participants 6 months out from their second dose of the vaccine for.

A total of 340 for participants elected to receive that does and.

And the top line results are reported here and we have a manuscript preparation that will be submitting shortly.

The results are generally consistent with what I've already shared from the choice choice at all data.

And that I mean that was bit neutralizing antibody titers headwind significantly prior to boosting at 6 months surprise her.

A third dose 50 micrograms of mrna 12, 73 boosted neutralizing titers to levels that are above the phase 3 benchmark and again this now being done in our clinically validated assays with our colleagues at NIH.

Stephen Hoge: I'm presenting data here, which has been submitted for in a manuscript. It's actually impressing as we speak, looking at the performance of 1273, over six months after the primary series, against the variance of concern. The third dose booster of 50 microm to 1273, pseudovirus neutralization titers here in our research assays were shown. And just to orient you quickly to the slide, we're looking against wild type, beta, gamma, and delta variance of concerns. The data in the first three columns deals with month one post-dose two.

After a third dose similar levels of neutralizing titles were cheat across age groups and importantly, a subgroup analysis of older adults over the age of 65. So they were both able to boost significantly and achieve levels that are comparable to younger adults, which is really encouraging.

And the safety profile following it does 350, Mike rooms, with similar to that observed previously for those 2 of them already 12.73 and.

In total we think this is really encouraging data on the potential for a 50 microgram booster other morning 12.73.

Stephen Hoge: So immediately following the primary vaccination series, for which we have the really strong efficacy data that Jackie just described, and as you can see, we see high titers against the wild-type strain, 1200 in this assay in this group, and substantially lower titers against the beta and gamma variants of concern, as has previously been reported. Following those subjects forward to month six to eight after their second dose, what you can see is waning both for the wild type virus, although it remains detectable levels of titers, but also for the variance of concern, particularly beta, gamma, and delta.

We're moving to 532, where does that leave us on our Covid booster strategy for a delayed third dose approximately 6 to 12 months after that nation, but we believe a booster dose is likely to be necessary. This fall, particularly in the face of the Delta area.

For clinical data right now we think supports a 50 micrograms per morning, 12, 73 booster and we see no obvious advantage for beta containing variant candidates driven both by the day that I presented today and the evolving epidemiology.

But we're gonna wait for 100 microgram data in the coming weeks to confirm that does selection of 50 micrograms as the booster before filing.

So moving off from the Covid booster I'd like to provide a little bit of an update on the other parts of our pipeline. So I'm moving to 533, we were excited to update today that M. Already 10, 10 hour for seasonal influenza vaccine candidate has entered the clinic.

Stephen Hoge: In fact, as you can appreciate in those middle four bars, beta, gamma, and delta neutralizing titers had fallen below the detectable limit of the assay for a decent number of participants in all three cases.

Stephen Hoge: Now, the great news is that a 50 microgram dose of MRN1273 was able to boost immunity against all four of those viral strains. And 14 days post dose three, we show the titers on the far right, again, all four bars. We saw 23-fold boosting against the wild type strain to levels that are significantly about the level we've seen just after the second dose. One month post-dose 2, we saw 32-fold boosting against beta, 43-fold boosting against gamma, and 42-fold boosting against Delta, again, all reaching levels that are significantly higher than previously seen.

And at 10.10 is moving quickly towards it's in an ongoing phase 1 to study.

I'll remind you that M already 10 tended to quadrivalent seasonal flu vaccine that's targeting the W. H O recommended strength an.

And our vision is to eventually combine them already 10, 10 is a seasonal flu vaccine in a pan respiratory vaccine booster per adult and elderly populations that combines blue Ah COVID-19, booster and potentially a respiratory syncytial virus lexi.

Looking and slide 30 for a cross are infectious disease portfolio beyond 10, Kim we have a number of other important updates and our R. S V vaccine or positive interim phase 1 data was announced that vaccine day earlier this year in phase 1 dosing pediatric and adult vaccine is ongoing for.

We recently, we're pleased to announce that we received F. D. A fast track designation for adults over the age of 60 in this pump in for this vaccine highlighting the <unk> the significant unmet need that we believe is there seems to be.

Stephen Hoge: And that is very encouraging, and we think confirms our selection of the prototype booster as likely to be protective against the circulating variance of concern, particularly Delta present. So advancing that MRNA-1273 program at 50 microbooster into phase two is something we did in parallel. And on slide 31, I'm happy to provide an update on the phase two results from that larger study of the prototype booster. Earlier this year, our phase two study of MRRNA-1273 was amended to offer a third dose of 1273 at 50 micrograms to all interested participants six months out from their second dose of the vaccine. A total of 344 participants elected to receive the prize.

R. H M. P V P. I V..3 vaccine another multi valent respiratory vaccine isn't a phase 1 b trial. That's currently enrolling in toddlers and the first cohort has been completely normal.

R. C M b vaccine against a significant unmet need uhm is on track to start it's pivotal phase 3 trial this year with roughly 8000 participants.

And lastly, our Zika vaccine phase 2 trial is ongoing and currently enrolling patients in the United States and Puerto Rico.

Moving slide 35 beyond our <unk> extend expanding infectious disease vaccine portfolio, we are advancing and then M. Ornate therapeutics and now have 7 programs and ongoing clinical trials.

In oncology or cancer vaccines programs with Mark include the personalized cancer vaccine and <unk> and we have 2 intratumoral programs, an ongoing phase 1 studies, Juan Tripling program ourselves and and I'll 12 program in combination with Astrazeneca.

Stephen Hoge: And the top line results are reported here, and we have a manuscript in preparation that will be submitted. The results are generally consistent with what I've already shared from the Choi at all data, which means that neutralizing antibody tiders had waned significantly prior to boosting at six months. No surprise.

In our cardiovascular therapeutic area, we have 2 programs the vet Jess program work and I'm going with Astrazeneca in phase 2 and a preclinical relaxing program.

An auto immune we were excited to announce that we'd started dosing, our first patient and and patient and I L..2 phase 1 study and that continues and the P. D. L..1 program remains in preclinical development and lastly in rare diseases, we have been dosing for this year in our appropriate against India program and Faye.

Stephen Hoge: A third dose, 50 micrograms, of MRN1273, boosted neutralizing titers to levels that are above phase 3, and again, this is now being done in our clinically validated assays with our colleagues at ENI. After the third dose, similar levels of neutralizing titers were achieved across age groups. And importantly, a subgroup analysis of older adults over the age of 65 showed they were both able to improve significantly and achieve levels that are comparable to younger adults, which is really encouraged.

This 1 and emanate G. S D..1 a M. P. K U programs are in preclinical and we look forward to starting a business.

Briefly on page 36, you can see are expanding pipe line of clinical programs and the continued advancement across all of our therapeutic areas, but most notably of our pro for prophylactic vaccines modality and infectious diseases for <unk>.

Stephen Hoge: And the safety profile following dose 3 at 50 micrograms was similar to that observed previously for dose 2 of MRN11273. In total, we think this is really encouraging data on the potential for a 50 microgram booster dose of MRNH12. But moving to slide 32, where does that leave us on our COVID booster strategy or a delayed third dose, approximately 6 to 12 months after that patient? We believe a booster dose is likely to be necessary this fall, particularly in the face of the Delta variant. Our clinical data right now, we think, supports a 50 microgram MRI 1273 booster, and we see no obvious advantage for beta-containing variant candidates, driven both by the data I presented today and the involving epidemiology.

I'd like to turn the call back to Stefan Benzal for closing remarks.

Thank you for calling baby check for you and Stephen B.

B for taking your questions have Michelle for.

Just slightly we articulate how we have been seeking for many years now how.

How about using <unk> for them to maximize all your thoughts on patients.

On the left we now have to call them on the other to use for vaccine and do you have achieved oh for ice product.

And for systemic secret day in central fix for apathy Kim Pink, we have achieved human proof of concept. We've all she couldn't good yeah antibodies day most of my team, we could get for off the secret relative antibodies N. We could you repeat those successfully.

And to me there we have fourth for throwing with iced tea, which were in the clinic. We've 6 programs taunted US then you could achieve a human for for concept.

For me this evening to make <unk> why didn't call you a review when we have genetic disease.

Mark coming in to come in <unk>.

Stephen Hoge: But we're going to wait for 100 microgram data in the coming weeks to confirm the dose selection of 50 micrograms as the booster before 4.5. So moving off from the COVID booster, I'd like to provide a little bit of an update on the other parts of our program. Moving to slide 33, we were excited to update today that MRN1010, our first seasonal influenza vaccine candidate, has entered the clinic. And 1010 is moving quickly towards its ongoing phase one-two study. I'll remind you that MRI 1010 is a quadravalent seasonal flu vaccine that targets the WHO recommended strength.

On the right you see too much for refusing to have not yet in the clinic, but for.

Which we believe we have achieved important you Miss Kim E. None the human clients did.

Did you bring a amount into <unk> and then you free of an amount of day to <unk> stem for generic though says.

Next slide combo that Mrs.

In vaccine, we are focusing on bringing to market. What can you believe could be a game changing risk or I'm sorry about that.

Submit this evening would combine overtime COVID-19 image sales.

You know so much sales cause I was still in 1 single anyone shops.

We have a great vaccine against COVID-19.

Oh, I think clinical data showed high level of any fries antibodies, which has led the idea to graduate frustrating the technician.

And it was quite a bit violence, even for vaccine eating the clinic now but for my Cat is 526 billion per day.

Stephen Hoge: And our vision is to eventually combine MRR&10 as a seasonal flu vaccine in a pan-respatory vaccine booster for adult and elderly populations that combines flu, a COVID-19 booster, and potentially our respiratory's incincential virus. Looking at slide 34, across our infectious disease portfolio, beyond 1010, we have a number of other In our RSV vaccine, our positive interim phase one data was announced at Vaccines Day earlier this year, and phase one dosing in pediatric and adult vaccine is ongoing.

I think I think I see being that's always me several came over on 60 per cent make with you and they'll go around 50 per cent thing about yeah. We.

We believe we can do better we buy them on and for that song given which will have demonstrated we've COVID-19.

And what other flu vaccine 582 launch as early as 20th 1 for you for Ya.

<unk> nope close to and free face for Ya and will cause you to believe the market for Boston D could be put to 5 be than that I'll probably day.

E B V for that stuff at the next window. There is no vaccine against C. M V infection or D V infection.

So we are working to where I'm moving to company from COVID-19, Prime vaccination fangs in 2021 to COVID-19 was going to want to thank you 1 and when did you want me to and beyond and then I think so as Hell. Yeah. So let me go ahead for Ya and then have you guys V and watching C. N V and then M T V.

Stephen Hoge: We recently were pleased to announce that we received FDA's fast track designation for adults over the age of 60 in this population for this vaccine, highlighting the significant unmet need that we believe is there in this disease. Our HMPPPB3 vaccine, another multivalent respiratory vaccine, is in a phase 1b trial that's currently enrolling toddlers, and the first cohort has been completely enrolled.

I'm excited about these for vaccine pipeline and how these vaccines could I prevent the depth hospitalization and disease in billions of people.

For Ya.

Stephen and you'll always have she came on up to arresting they're working in the labs on Nov I think on the day and we can't wait to share. We view these new vaccine commendation in the future as we take them into can you put a studies.

Stephen Hoge: Our CMV vaccine against a significant unmet need is on track to start its pivotal phase three trial this year with roughly 8,000 participants. And lastly, our Zika vaccine phase two trial is ongoing and currently enrolling patients in the United States and Puerto Rico. Moving on to slide 35, beyond our expanding infectious disease vaccine portfolio, we are advancing MRNA-RNA-th therapeutics and now have seven programs in ongoing clinical trials. In oncology, our cancer vaccine programs with Merck include the personalized cancer vaccine and KRAS, and we have two intratumeral programs in ongoing phase one studies, one, a triplet program ourselves, and an IL12 program in combination with AstraZenica.

Did you do other power of amount man has any information went through and the <unk> is this for you. They should've, Montana and did these television I'm Gonna, Ghana, and our cash Felicia will enable all teams to bring your total time vaccine to protect people at the SK and that's a case not to be following a pharmaceutical industry.

You can put them in disease, we aim to 14th was Kim that's for up to carry on.

Next like extra <unk> 6 kindergarten programs in force by talking with other T's, if we get for the keep could you go signal was Kennedy is what I see as quickly as way.

That's where the beauty of a blood problem comes into per.

Next line Matthias evening reception very typical of a lockdown mindset and they'll devalue a to maximize onion for some patients we call for you to invest in science to expel me and will there be peace like the 1 in a long and most of that for you put up day, that's all fans day eating them at some point the stem says.

Stephen Hoge: In our cardiovascular therapeutic area, we have two programs; the VEGF program, work ongoing with AstraZeneca in Phase 2, and a pre-clinical relaxation program. In autoimmune, we were excited to announce that we had started dosing our first patient in an I, in an IL2 phase one study, and that continues. And lastly, in rare diseases, we have been dosing for this year in our propionic acidemia program in Phase 1, and MMA, GSD-1A, and PQU programs are in preclinical development, and we look forward to starting these. In brief, on page 36, you can see our expanding pipeline of clinical programs and the continued advancement across all of our therapeutic areas, but most notably, our prophylactic vaccines modality. With that, I'd like to turn the call back to Stefan Vanzel in the closing room.

You know non program, we are both working on using M. On it for expressing human for pain in the center that total filth <unk> got fixed partnership.

That's what excites at the bus all exploration of do we need gene editing using them all day to express their do you need the thing enzyme that piece of chicken Peptics partnership.

Next I I believe that the uniqueness someone down now he's that's why it's spending on your personal information into that makes sense.

We're expanding and put them in <unk> at the same time, because we have <unk> and you can just for life or I'm on the platform.

Because I'm on his information I'm way cooler, but can make them interest you can walk you know what I T that could COVID-19 vaccine then we have the same for building blocks of life to make kind of a vaccine.

So we can we can get them without a P 40 fast around the first dimension of the Y axis on.

On the second line and make sure I need to keep it spending your applications of them all day to new cell types on the X axis.

Stephan: Thank you, Corin, David, Jackie, and Steven. Before taking your questions, let me share a few thoughts. On this slide, we articulate how we have been thinking for many years now about using our MRNA platform to maximize our impact on patients. On the left, we now have two core modalities.

And weathering both for the same thing with different dedicated teams.

For Paul Bioscience Hall, digital and the manufacturing infrastructure.

David <unk>, a framework for Capello location.

<unk>. That's about you know I think a significant amount of cash each for it though.

Our number 1 priority is a company has always been and will call came to be to invest in the business. We call to you to believe that's the way in the early days of a Newcastle medicines, and Melanie and <unk> moving why don't have the other go in and out for money too and 50 years ago any indication for next.

Stephan: For vaccines in blue, we have achieved authorized products, And for systemic secreted and cell surface parapetics in pink, we have achieved human proof of concept with our chikungunya antibodies, demonstrating we could get ferapatic levels of antibodies, and we could repeat those successfully. In the middle, we have four exploratory modalities that we are in a clinic with six programs to understand if we achieve human proof of concepts. For medicine in immunolology, one in cardiology, when in rea genetic disease, not a coming in the coming quarters.

Day, 222, 40 years I went to see a very large number will be important for medicines.

And because I'm all amazing information would be cool, because we got burned already fast.

We aim to forget to beat the world leading amount of the company.

So we're talking about the investments in acceleration of programs are within the clinic.

This meant in you gave it up for <unk> tell me day moving from relapse. The clinic investments no platform to call for me to improve a science and we put in you will that be for you.

Stephan: On the right, you see two monalities which are not yet in the clinic but for which we believe we have achieved an important de-risking in non-human crime, delivery of MR into the lung and delivery of MRN into the lung and delivery of MRN into immatopoetic stem progenitor cells. Next slide.

The investment manufacturing and best friends need commercial presence, including all did your total commercial presence investments and does your total cause we can cable company Foster Henbit, Kevin finished up I will take off for my company.

Also going priority is to expand authorize loans that compliment I think a platform with extra milk technologies or products.

This means would interest kidney and you pick a seat technologies Jeannie.

<unk> <unk>.

<unk> M.

<unk>.

Stephan: In vaccines, we are focusing on bringing to market what we believe could be a game-changing respiratory vaccine, that medicine would combine over time COVID-19 boosters plus seasonal flu boosters plus RV boosters in one single annual shot. We have a great vaccine against COVID-19, or IZ clinical data have shown high levels of neutralizing antibodies, which has led the FDA to grant a fast-track designation, and our quadruvalence seasonal flu vaccine is in the clinic now. The flu market is 5 to 6 billion per year, despite true vaccine efficacy being notoriously several optimal, around 60% in a good year and down to around 30% in a bad year.

The amount of prompt if we find new day with technologies that could expand all correct typically Keith we will look at them carefully.

Who would be interested in tech number she's like <unk> and <unk> and do you have a friend called the day licensees and all if he can make sense emanate.

Mmk comes on that she'll be disappearing.

We know what it takes to grow from early research to filing <unk> regulatory agencies.

And for having done Inc. We know for a week associated with new technologies and everything that walks in the mouse with nothing this on you what can I get.

Promised for the drink standpoint, we are not interested in small <unk> all ultimately could do for fun color days.

Even if they could come to the amount of commercial for both for Ya.

We log information when it becomes too much to be interested in <unk> excellent very cool logical convenient for money cruise Austin for okay.

Stephan: We believe we can do better with our MRA on a platform, given what we have demonstrated with COVID-19. The modern-frew vaccine candidates could launch as early as 2023. CMV is not close to entering phase three, and we will continue to believe the market opportunity could be $2 to $5 billion per year. EBV shouldn't have a clinic soon. There is no vaccine against CMV infection or EBV infection.

The share buyback is our first 1.

We are very optimistic about the future of Madonna.

And we're just getting started on.

Both of the articles will continue to work with all your review what is the right thing to do to we think that total <unk>.

Balance against the investments and that'll business and next thing you just spent a Boston U T S.

Let me spell for now I mean, it's about corporate interests for 70 twos is is very important for us to make a note on that and what day of corporate responsibility and to be assist enable business that.

Everything we do we don't just want to do things like what to do things in the best placebo anyway.

Stephan: So we are working toward moving the company from COVID-19 prime vaccination sales in 2021 to COVID-19 booster shots in 2021 and 2022 and beyond, and then adding flu as early as Sony-G-3, and then adding RASV and launching CMV. I am excited about this vaccine pipeline and how these vaccines could help prevent deaths, hospitalizations, and disease in billions of people over the years. Even in your research scheme, they are not to rest; they are working in our labs on more vaccine candidates, and we cannot wait to share with you these new vaccine candidates in the future as we take them into clinical study.

Well, we're pleased to announce for centuries, the establishment of charitable foundation within the <unk> <unk>, a 50 million dollar all with a significant focus on other symptom corporations.

We are both love being awarded the number 1 spot on fast company, 20th don't see 1 for best place to work for nobody sauce, which compromise <unk> 6 for Thanksgiving you a recognition by science as a tough for them for Ya.

Both of walls or we've kicked the ball fence, we place on the line of toys and the coach over pumping.

We set for the extra salaries released it's 2021 quite quite repetition, Sylvia and the modem that Brandon ranked syrup <unk> 1 on growth of a most visible you Miss companies. All first mentioned on the list and the highest ranking for anybody public sequent company for culprits repetition.

Wherever sent me works for that can I sleep with a U S government twist Ah city take donations have been more than that COVID-19 vaccine too many low income countries.

Stephan: This is where the power of MRNA as an information molecule and the industrialization of Moderna and the digitalization of Moderna, and our cash position will enable our teams to bring important vaccines to protect people at a scale and at a pace not seen before in the pharmaceutical industry. For autoimmune disease, we aim to continue to scale that therapeutic area. Next slide: exploratory modality, six clinical programs in four respiratory modalities. If we get positive clinical signals, we scale these modalities quickly as well. That's where the beauty of a platform comes into play.

And we are committed to minimize inc. On actually footprint.

As I look for the next decade, the same no salt is getting us and since we started.

We believe we have a responsibility to maximize went back to protect people and help patients.

Oh commitment the strong of N F. L. This is just the beginning.

We look forward to welcoming you I thought I knew it all your day on September 9th.

<unk> will do a detailed review of a development pipeline.

The team and I would be happy now for take your questions for probably call.

Okay. That's a reminder to ask a question you will need to press for 1 on your telephone and to withdraw your quest for the pound key there first question for them. The line of solving rich Sir from Goldman Sachs Extra line is now open.

Good morning. Thank you for taking my question could you walk us through the dynamics for 2022 and beyond in terms in terms of a pig for spike bags essentially demand in the context of supply of the 2 to 3 billion doses for 2022, and then how we should think about the years beyond 2022 and pricing and then secondly with.

Stephan: Next slide, news in research. Very typical of our long-term mindset and our desire to maximize our impact on patients, we continue to invest in science to explore new modalities, like the one in the lungs and, more recently, presented at our science day, in metal poetic stem cells. In our lung program, we are both working on using MRNA to express a human protein in a cell. That was our first vertex partnership, but we are excited about our exploration of doing gene editing using MRI to export a gene editing enzyme that is our second vertex partner. Next slide.

[noise] regard to external V. D. How are you thinking about integrating areas like gene editing and gene therapy with your platform.

Oh, maybe I'll start on the the answer them 22, 23, so as we said.

Right now, we're we've announced that were increasing our capacity, we see very strong demand continuing in the context of the pandemic and well into 2022.

Stephan: I believe that the uniqueness of moderna is that we're expanding your impact on patients in two dimensions. We are expanding in two dimensions at the same time because we built and industrialized our RMA on a platform. Because a MN is an information molecule, once we make a medicine work in a modality, like a COVID-19 vaccine, then we use the same four building blocks of life to make another vaccine. So we scale within a modality, really fast along the first dimension of the wire.

And the hand squeeze, giving you the range of 2 to 3 billion doses Ah depending very much on whether customers are still purchasing for primary series or if they're looking at boosters and then depending on the eventual dosage for.

Boosters, so I think it's really going to evolve as to exactly what the books like in terms of dosage going beyond 22, as we said we are starting to see you know the forward.

Stephan: On the second dimension, is to keep expanding new applications of MRI into new cell types on the X-axis, and we are doing both at the same time with different dedicated teams, all powered by our science for digital and our manufacturing infrastructure. David shared earlier a framework for capital allocation now that we are generating significant amounts of cash each quote. The number one priority as a company, as it has always been, and we continue to be, to invest in the business.

Planning countries that are looking beyond the the very near term. We're starting to then have contract discussions and in fact have agreed some contracts into 23.

But I think it's early to really know as to how this is going to evolve in terms of the transition from and then like to the <unk>.

Stephan: We continue to believe that we're in the early days of a new class of medicines, and if small molecules more than 100 years ago and large molecules 50 years ago are any indication, the next 10 to 20 to 40 years are going to see a very large number of important medicines. And because Marnase is an information molecule, it will happen really fast.

In terms of pricing I think it's it's helpful to to start with where we are in 2021 to have a context for understanding pricing going forward. So really 3 buckets of pricing in 2021, we have the U S government.

Stephan: We aim to continue to build a world-leading company among them, so we are talking about investments in the acceleration of programs already in the clinic. Investment in new development candidates moving from the labs to the clinic, investment in our platform to continue to improve the science and implement new modalities, investment in manufacturing, investment in commercial presence, including our digital commercial presence, and investment in digital, so we can scale our company faster and better than traditional biotech or pharma companies.

Where the first hundred million doses was priced at a little over $15. The subsequent for 100 million doses were contra to that's 16.50.

And that pricing was considering a couple of things 1 is the bar to funding we received to underwrite are pays for free trial and also the the size of the contract for 500 million bills contract, which is very large the second category is the higher income.

Stephan: Our second priority is to expand our horizons by complementing our platform with external technologies or products. This means we are interested in nucleic acid technologies. Gene Therapy, gene editing, and Ma, On the amount front, if we find new delivery technologies that could expand our current capabilities, we will look at them carefully. We would be interested in technology licenses and or in development cards and or, if it makes sense, M&A. You can count on us to be disciplined; we know what it takes to go from early research to filing regulatory agency, and for having done it, we know the risks associated with new technologies, and everything that works in the mouse. We're not necessarily working in a unit.

X she was countries, whereas we've said in the past we start with a price range of 32 to $37 a dose and there are some cases, where we all for a discount spaced on volume for high volume and then the third category is low and middle income countries.

Uhm, which have received the lowest tiered pricing, including those sales to kovacs, which are considerably lower than the price to the U S government.

Uhm, so if we start with that a framework for 21, what we can say is that the contracts that we signed now for 2022 other.

The pricing con stripes are very consistent with that framework that we've had in 2021.

Stephan: From a strategic standpoint, we are not interested in small molecule or large molecule development candidates, even if they could complement our commercial portfolio. We love information molecules too much to be interested in occurring analog molecules, axmo molecule, molecule, large recombinant molecules, or cell therapy. She shab by back is our first one.

And so we see a continuation.

In the context again of of the pandemic with the with the pricing framework.

If you look at the average price that you'd calculate on your model of course, that's gonna depend on the the mix across these categories and of course, we're expecting to see significant sales to the middle and low income countries and that increase.

Stephan: We are very optimistic about the future of moderna, and we're just getting stunted. Our board of directors will continue to regularly review, but it is the right thing to do to return capital to shareholders in light of our cash generation, balance against investments in our business and external investment opportunities. We will talk now for a minute about corporate responsibilities. It is very important for us to make Modana a model of corporate responsibility and build a sustainable business. Like everything we do, we don't just want to do things well.

<unk> in 22, so it shouldn't be surprising if the average you see some declines.

And then finally I would just come at the as we move into a post spend on the courier than we would expect as we've said in the past to market forces to impact or price negotiations.

So hopefully that answered your questions.

And salvino I'll, maybe just typing a T M. With your first question on for Jean editing, which is how do we see an intersecting look I I think we we have been as you as you all know innovator in M Arnie and lipid nanoparticle delivery and therapeutics Uhm for awhile and we've watched.

Stephan: We want to do things in the best possible way. We were pleased to announce recently the establishment of our charitable foundation within that front endowment of $50 million with a significant focus on the disabled population. We are humbled to have been awarded the number one spot on Fass Company 2021 for best place to work for innovators, which complements our last six consecutive years of recognition by science as a top employer. Both awards reflect the importance we place on our employees and the culture of the company.

The space quite interesting Lee are quite significantly in terms of ways that we could help with delivering Gina is in cargoes across a range of different tissues, where I live for nanoparticle systems have been shown to go even in humans.

And and we we think it's the right time for us to start to expand in that direction get there's a general convergence I think out there in the gene editing space. It said messenger RNA and lipid nanoparticles are perhaps the way to go and that's something we strongly agree with having having spent the last decade working in the technology, so you'll be looking for us.

Stephan: Recently, Axios Harris released its 2021 corporate reputation survey, and the Modena brand ranked third among 100 of the most visible U.S. companies, and first mentioned on the least, and the highest ranking for any pharmaceutical company for corporate reputation. We have recently worked relentlessly with the US government to facilitate donations of the modern COVID-19 vaccine to many low-income countries, and we are committed to minimizing our energy food. As I look to the next decade, the same North Star is guiding us since we started. We believe we have a responsibility to maximize our impact to protect healthy people and help patients. Our commitment is stronger than ever.

To bring a new payloads, new capabilities, new enzymes into our existing technological capabilities, which we think are uhm best in class.

Thank you.

And your next question comes from the line is Matthew Harrison for Morgan Stanley Her line isn't that open.

[noise] great. Good morning, Thanks for taking the questions that a couple of related questions on on booster is if I may I guess first question is maybe you could just put in context for some of the information we're hearing from the F D a or the C. D C, especially a T I P on their position on boosters and how you would expect.

That to evolve over the coming months Uhm second M could could you comment on the potential for a multi valent booster and how you might be thinking about that in the context of the day that you presented today, especially just on using a third dose of the existing shot and then third could you may.

Stephan: This is just the beginning. We look forward to welcoming you at our annual RAN Day on September 9, and unlike in previous years, we will do a detailed review of a development package. The team and I would be happy now to take your questions. Okay, as a reminder, to ask a question, you will need to press door 1 on your telephone, and to withdraw your question, press the ground key. Your first question comes from the line of Salvin Richter from Goldman Sachs. Your line is now open. Good morning.

To be just comment on your views of of long-term virus evolution, obviously typically.

Viruses tend to evolve towards more infectious, but lower virulence and so I'm wondering what your thoughts are on the longterm booster market, obviously versus the sort of near term booster market went infections may still be quite high. Thanks.

Salveen Richter: Thank you for taking my questions. Could you walk us through the dynamics for 2022 and beyond in terms of APAs for Spike Vax, essentially demand in the context of supply of the two to three billion doses for 2022, and then how we should think about the years beyond 2022 and pricing? And then secondly, with regard to external BD, how are you thinking about integrating areas like gene editing and gene therapy with your platforms? Maybe I'll start on the answer at 2223.

Sure. Thank you ma'am, so let me try and take the first question for so you know I I think we are going to always differ to uhm, what's happening with a public health officials in terms of when they think the appropriate for time to recommend a booster vaccine is necessary uhm, where we.

There, we see the day to ourselves I can't speak to the challenges they face, but what we see is the potential for waning immunity. In fact, if you. If you look at backyard vaccines day, we had that professor Davenport come in and present work that he'd done at University of New South Wales in Australia, showing what he predicted back in March would be the picture.

Stephan: So, as we said, right now, we've announced that we're increasing our capacity. We see very strong demand continuing in the context of the pandemic well into 2022. And hence, we've given you the range of 2 to 3 billion doses, depending very much on whether our customers are still purchasing for primary series or if they're looking at boosters.

For for waning immunity from the vaccine. It was recently published in nature Medicine, I had a chance to <unk> and you know, it's looking remarkably prescient because the predictions he was making about the relative strength of the different vaccines suggested that small differences in advocacy would start to emerge to be large or <unk>.

Orange as an advocacy at about 200.250 days as neutralizing antibody titers wait and you know that maybe what we're starting to see <unk>.

Stephan: and then depending on the eventual dosage for boosters. So I think it's really going to evolve as to exactly what that looks like in terms of dosage. Going beyond 22, as we said, we are starting to see countries that are looking beyond the very near term. We're starting to then have contract discussions and, in fact, have agreed some contracts into 23.

And if you play that for if you assume he's been right about those predictions then that picture continues and continues through a year.

With continued declining uhm neutralizing antibody titers over that time and eventually we there for believe you know a real increase breakthrough infections and disease, even with vaccinated participants even with them already 12.73.

So we we continue to Wanna be vigilant, because that trend uhm and those predictions, we think will come to her for and I think the delta variances tosses to also be incredibly humble in the face of the virus's ability to fight back and increase its transmission I mean, I think most of US would've thought charged Kobe too was a pretty good infector.

Stephan: But I think it's early to really know as to how this is going to evolve in terms of the transition from pandemic to the endemic phase. In terms of pricing, I think it's helpful to start with where we are in 2021 to have a context for understanding pricing going forward. So really, three buckets of pricing in 2021. We have the U.S. government where the first 100 million doses were priced at a little over $15.

Earlier this year Delta his shoulders day that it can it can make huge steps for.

Uhm and so for all those reasons, we think that it's appropriate to to be cautious. Our approach is not too you said you for the public help them win boosters are gonna be necessary, but to bring forward. The best option as we see them based on the science that we see in the evolving epidemiology and that's where I think our conclusion today is given you know.

Stephan: These subsequent 400 million doses were contracted at 1650, and that pricing was considering a couple things. One was the Barta funding we received to underwrite our phase three trial and also the size of the contract, the 500 million dose contract, which is very large. The second category is the higher-income ex-US countries, whereas we've said in the past, we start with a price range of $32 to $37 a dose, and there are some cases where we offer discounts based on volume for high volume. And then the third category is low and middle-income countries, which have received the lowest tiered pricing, including those sales to Kovacs, which are considerably low.

Given beta gamma and particularly delta given the real world efficacy that we're seeing out there against Delta right. After vaccination for 12, 73, and the neutralizing titers that we can see that I presented the day against Delta with a 12.73 prototype dose that we feel pretty confident that that's actually the right way to approach. This round of the fight with <unk>.

I was good with your virus.

Now if I can give it to the second and third question trash. The this is not the last round of the fight with Sars Kobe too we expect it to have at least a couple more rounds and maybe annually. We're just gonna continue to fight those fires back.

Stephan: than the price to the U.S. government. So if we start with that framework for 21, what we can say is that the contracts that we've signed now for 2022, the pricing constructs are very consistent with that framework that we had in 2021. And so we see a continuation in the context, again, of the pandemic with the pricing framework. If you look at the average price that you'd calculate on your model, of course, that's going to depend on the mix across these categories.

And that's where we think multivalent boosters continue to be an important part of the scientific strategy.

As you look forward to say early 2022, you know Delta is what we're fighting right now, but what are we gonna be fighting you know in 2022, what new variant of concern there will be 1 and I look at the evolving picture with Delta and and and the overall variance of concern and there's a couple of specific things.

That jumped out at me there are now 5 point mutations in the various variance of concerned 3 of them present in beta and gamma we've talked about them. The for 17484 and 5 O 1 mutations and and now there's 2 mutations and the receptor buying domain and and the Delta strain for 5.2 and 478.

Stephan: And, of course, we're expecting to see significant sales to middle and low-income countries, and that will increase in 22. So it shouldn't be surprising if the average you see some declines. And then finally, I would just comment that as we move into a post-pandemic period, then we would expect, as we've said in the past, market forces to impact our price negotiations. So hopefully that answers your question.

Uhm and those 5 look like the ways in which the virus has tried to step away from are neutralizing immunity with our vaccine immunization.

If you if you think about how this might play for it seems logical to us that those 3 mutations present in the beta Gamma line in those 2 mutations presence in the delta might find some way to combine and new and potentially scary ways and if that came with the increased Transmissibility <unk> force of infection adult good can achieve.

Stephan: And Salveen, I'll maybe just pipe in at the end with your first question on gene editing, which is, how do we see it intersecting? Look, I think we have been, as you all know, the innovator in MRNA and lipid nanoparticle delivery and therapeutics for a while. And we've watched the space quite interestingly or quite significantly in terms of ways that we could help with delivering gene editing cargoes across a range of different tissues where our ellipid nanoparticle systems have been shown to go, even in humans.

It might be a significant threat and so we view our multivalent platform as the best place for us to try and anticipate that threat and logically for US right now that would be looking at a beta gamma or a beta version of concern combined with a delta very concerned and evaluating that going for it and that's at 213 program that we're gonna be looking at.

But we don't think for the <unk> for that's for for this cycle. We we do really believe that 12.73, a booster dose will hold up against Ah Delta right now.

Stephan: And we think it's the right time for us to start to expand in that direction. If there's a general convergence, I think, out there in the gene editing space, it's that messenger RNA and lipidana particles are perhaps the way to go.

The longterm virus evolution questions are great Juan and you know I'll take you know, we just gotta be humble we've not faced a variant of virus quite like this and again I don't think any of US would have predicted this the step change in transmissibility that were seen with delta over the last 5.6 months, so I wouldn't rule out there.

Stephen Hoge: And that's something we strongly agree with, having spent the last decade working in the technology. So you'll be looking for us to bring new payloads, new capabilities, new end-users into our existing technological capabilities, which we think are best in class. Thank you. In your next question, come from the line of Matthew Harrison from Morgan Stanley. Your line is now open.

The virus doesn't have those kinds of surprises and its future, but did you take it very very long for Ya you know 510 years view.

I would say that we continue to think that <unk> the model for what Sars Kobe too will look like in terms of an endemic market is probably predicted by other respiratory infection would be endemic Corona viruses like O C 43, which every year have a right to reinfection in adult populations and young for.

Matthew Harrison: Great, good morning, thanks for taking the questions. A couple of related questions on boosters, if I may. I guess the first question is, maybe you could just put in context some of the information we're hearing from the FDA or the CDC, especially ACIP, on their position on boosters and how you would expect that to evolve over the coming months. Second, could you comment on the potential for a multivalent booster and how you might be using it?

Kids every year resulted in hospitalizations and some deaths, including in this country and and we therefore believe there will be a longterm endemic market. The virulence of those viruses as you pointed to his lower and that's good news you know hopefully it's not as big of a threat as we're seeing right now, but we need to be cautious and humbled because that's gonna be 2 keeps surprising us.

Matthew Harrison: Be thinking about that in the context of the data you presented today, especially just on using a third dose of the existing shot. And then, thirdly, could you maybe just comment on your views of long-term virus evolution? Obviously, typically, viruses tend to evolve towards more infectious but lower virulence. And so I'm wondering what your thoughts are on the long-term booster market, obviously, versus the sort of near-term booster market when infections may still be quite high. Thanks. Sure, thank you, Matthew. So let me try and take the first question first.

And maybe that Bureau is will be something more substantial than what we see in the Democrat of hours. So we're hopeful that it will wait <unk> that <unk> will decline, but we really do believe the virus is here to stay for the long term and therefore, there's gonna be a need to regularly boost particularly high risk older populations against Sars Kobe to into the future.

Hopefully answered your questions.

And your next question, calling for the line. That's that's hall from Piper Center for line is now open.

Great. Thank you very much and thank you for all of the.

Zero for information <unk>.

Spike Spike sex, but also for the pipeline.

Stephen Hoge: So, you know, I think we are going to always defer to what's happening with the public health officials in terms of when they think the appropriate time to recommend a booster vaccine is necessary. Where we see the data ourselves, I can't speak to the challenges they face, but what we see is the potential for waning immunity. In fact, if you, you know, back on our vaccine day, we had Professor Davenport come in and present work that he had done at the University of New South Wales in Australia, showing what he predicted back in March would be the picture for waning immunity from the vaccines.

I guess for me first question has to do with.

Uhm capacity and really trying to understand a little bit for more fully what goes into continued growth <unk>, especially overseas.

And I guess, the second question would be what's.

With respect to the worst in disease pipeline, which was you know I think he does does for my favorites.

Just in terms of application for for M for a day you know.

How can we be moving faster there again appreciating that for you guys have a pandemic you're trying to address but it seems to me like everything set to go there.

Stephen Hoge: It was recently published in Nature Medicine. I had a chance to open it, and, you know, it's looking remarkably prescient because the predictions he was making about the relative strength of the different vaccines suggested that small differences in efficacy would start to emerge as larger differences in efficacy at about 200, 250 days as neutralizing antibody titers waint.

I'm just curious what what can we do it the baby accelerate some of those for pork programs. Thank you. So much for taking my question.

Thanks for the maybe I'll go I'll go ahead.

Oh, so if that's I think the capacity and then Stephen though.

Well it is so as you recall said you know we've announced I think he wasn't February the bays on them off get feedback.

Stephen Hoge: And that may be what we're starting to see. And if you play that forward, if you assume he was right about those predictions, then that picture continues and continues through a year with continued declining neutralizing antibody titers over that time. And eventually, we therefore believe, you know, a real increase in breakthrough infections and disease, even with vaccinated participants, even with, and we're on 81273. So we continue to want to be vigilant because that trend and those predictions, we think, will come before.

The other countries.

The the highest because see of of all vaccine cause there was a lot of demand and so if you record we decided to make very excuse me to take care of for manufacturing.

Last name craze, no 50 per cent that'd be sending the U S.

Or a doll U S sites for drug substantive normal then then the doubling of Oh, you with capacity.

<unk> <unk> and ROE V.

All goal is to as I said in my remarks, depending on the boost of those which until we have final say by the regular day, so and if you don't receive 1 other than microgram data for 12.70 free failed those are Stephen to describe we won't know for sure, but if you're <unk> bold the prime.

Stephen Hoge: And I think the Delta variant has taught us to also be incredibly humble in the face of the virus's ability to fight back and increase its transmission. I mean, I think most of us would have thought SARS-CoV-2 was a pretty good infector earlier this year. Delta has shown us that it can make huge steps forward.

<unk> a P is that they've already been all day on which would be of course.

At 1 other than my programmer if your mother, the what's gonna keep eighth in the mix between Prime series and booster vaccines for Spike box.

<unk>.

The Bush still goes was 15 microgram, we could have up to free be done goes off of supply and if there were still goes well for 1 other than micro or.

Stephen Hoge: And so for all those reasons, we think that it's appropriate to be cautious. Our approach is not to, you know, defer to public health on whether wind boosters are going to be necessary but to bring forward the best options as we see them based on the science that we see in the evolving epidemiology. And that's where I think our conclusion today is given, you know, given beta gamma and particularly Delta, given the real world efficacy that we're seeing out there against Delta right after vaccination with 1273 and the neutralizing titers that we're.

That could take us up to 2 billion all of supply. So it's a bit hard to think about it but for a thing to do is to no time for China and for having these yeah, which is happy program cause I've seen in my remarks, you know we have been tracking for 8 under the medium will be done.

Those this yeah, but I've also said that we are not taking any of them all those for 2021 and it goes without <unk> cause that'd be maxed out and of course, we would also be in a position, where we can and sell to any countries in wanting more vaccines and so by doing those new investments for what are you, hoping that next year, we can make sure.

Stephen Hoge: You can see that I presented today against Delta with a 1273 prototype dose, and we feel pretty confident that that's actually the right way to approach this round of the fight with the SARS-CoV2 virus. Now, if I pivot to the second and third questions you ask, this is not the last round of the fight against SARS-CoV-2. We expect it to have at least a couple more rounds, and maybe annually, we're just going to continue to fight this virus back. And that's where we think multivalent boosters continue to be an important part of the scientific challenge.

That we can fulfill all the demands we're gonna get something for market and is Corrine mentioned you know why do we have already thanks for the beginning of a P is for next year and as we go as countries. An additional 8 billion on top of a 12 of all per cent that those countries have the I've seen a lot of discussions ongoing.

And so what we want to do is to Muckey my dependent for shut off Spider box around the world and I believe that the new data of this morning is showing that the if he could see the find out if he could see all day.

The cost of these are all being very nicely I think we just be getting a argument for countries to Walter Vaccinate has many if you put other came back on free we've we've twice a day for him yeah.

Stephen Hoge: As you look forward to, say, early 2022, you know, Delta is what we're fighting right now, but what are we going to be fighting, you know, in 2022? What new variant of concern? There will be one.

That's helpful. Stephen.

Do you want like what's your budget.

Yeah, I mean so.

I I think you know we've had a longstanding commitment to these populations and and that's a strong today as ever and we we here and want to do everything we can do so are these medicines for them. It's important to say this is fact to the finishes the goal not the fast for the start and while we're pleased with the start of the appropriate to get to the new program and hopefully shortly and.

Stephen Hoge: And I look at the evolving picture with Delta and the overall variance of concern, and, you know, there's a couple of specific things that jump out at me. There are now, I think, five point mutations in the various variances of concern, three of them present in beta and gamma. We've talked about

And other than the clinic Uhm you know our goal is obviously to rapidly move through those phase 1 study to find the right dose and hopefully then rapidly move into pivotal studies and as you know that can happen very quickly and so it particularly in rare diseases, particularly with some early positive clinical data and so that's what we're trying to do right now is.

Stephen Hoge: done the 417, 484, and 501 mutations. And now there are two mutations in the receptor binding domain in the Delta strain, a 452 and 478. And those five look like the ways in which the virus has tried to step away from our neutralizing immunity with our vaccine, immunization. If you think about how this might play forward, it seems logical to us that those three mutations present in the beta gamma line and those two mutations present in the Delta Delta might find some way to combine in a new and potentially scary way.

Anticipate that positive day to expand and build out our team and that therapeutic area and begin the Moore foundational preparations for for closing very quickly. If we can get some encouraging positive clinical science, but working every day to try and get the to accelerate the time for those are encouraging drinking early data.

And you know as well as as I said prepare for that future.

Fair enough. Thank you gentlemen.

And your next question for for the line of Michael <unk> from Jeffrey sister line is now open.

Hi, good morning, Thanks for the questions 2 questions..1 on boosting do you guys have a good sense of what you think the regulatory V or hurdle is to support boosting you should that great day. It on July 30, showing the waning antibodies and I think we all see that could be a problem and how the 30th.

Stephen Hoge: And if that came with the increased transmissibility, the force of infection that Delta can achieve, that might be a significant threat. And so we view our multivalent platform as the best place for us to try and anticipate that threat. And logically for us right now, that would be looking at a beta gamma or a beta variant of concern combined with a delta variant of concern and evaluating that going forward. And that's the 213 program that we're going to, but we don't think that's for this cycle.

<unk> get your way up but what do you think that specific data is or put another way the tighter level for for like a protection would be to support <unk> for the fall or the winter Hutch question..1 and then a question to a little bit similar on flu with that day to coming up later this year. It hit your view that significantly higher.

Stephen Hoge: We do really believe that 1273, a booster dose will hold up against a delta right now. The long-term virus evolution question is a great one. And, you know, I'll say, you know, we just have to be humble.

Levels of antibodies will need to significantly higher efficacy and that with just a larger study that will also be supportive of of a launch I think you said in 2023. Thank you.

Sure. So I'll I'll I'll try and take the first question Uhm, which was.

So how'd you point too well, we do not currently have a correlate of protection and you know in the world. Unfortunately for any of the vaccines and so it's very hard to say objectively what tighter what level is this sort of the minimum level, which is why in our minds and subject to the regulars to developing their own perspective, but in our mind the right way too bench Mark This is <unk>.

Stephen Hoge: We've not faced a variant or a virus quite like this. And again, I don't think any of us would have predicted the step change in transmissibility that was seen with Delta over the last five, six months. And so I wouldn't rule out that the virus doesn't have that kind of surprise in its future. But if you take a very, very long, five, ten years view,

Uhm, let's look at that really consistent hi, durable efficacy and phase 3 let's look at the neutralizing titers that support that uhm and let's do back let's get above those titers, because if we can exceed those tires and where we were just after the primary vaccination series than it should stand a reason that we should be able to provide.

Stephen Hoge: I would say that we continue to think the model for what SARS-CoV-2 will look like in terms of an endemic market is probably predicted by other respiratory infections, the endemic coronaviruses, like OC-43, which every year have rates of reinfection in adult populations and young kids and every year result in hospitalizations and some deaths, including in this country. And we therefore believe there will be a long-term endemic market. The virulence of those viruses, as you pointed out, is lower, and that's good news.

<unk> durable protection at or above the levels that we saw before.

Now of course, the viruses evolving and that's where you know where you see delta and we have to be humble about that but the good news is it looks like in the real world data that the vaccine 12, 73 is holding up against Delta Uhm, even with partial vaccination is Jackie mentioned in her slides it with some of those references and so we do think that you know getting at or above those levels.

Stephen Hoge: Hopefully, it's not as big of a threat as we're seeing right now, but we need to be cautious and humble because SARS-CoV-2 keeps surprising us, and maybe that virulence will be something more substantial than we see in endemic coronavirus. So we're hopeful that it will wait, that virulence will decline, but we really do believe the virus is here to stay for the long term, and therefore there's going to be a need to regularly boost particularly high-risk older populations against SARS-CoV-2 into the. Hopefully, this answered your question. And your next question: gone from the line is Fed Denthoff from Piper Sanver. Your line is now open. Great.

Should hold up quite comfortably Ah how much above those levels. You know is it is it 1.0. It was at 2.0 you know is it some other number I think that's you know ultimately going to be a sense that we want to have between ourselves of the data that we have the benefits of the different dose levels 50, My Grandma hundred micrograms.

And you know again uhm the day that we we've already seen in terms of Faith Street, and then a dialog with regulators about how they see that benefit risk, but as it stands today Uhm, we think that 50 microgram day to that we presented really looks encouraging and lightning meet that standard, but we want to hold off look at the Hunter, Mike room data and just a few weeks here and decide no.

That's the right call. We've we've got to the levels, we need to uhm and we think we can <unk> reset annuity in a vaccinated person with a third those at or above the levels that have been driving this durable protection today.

Edward Andrew Tenthoff: Thank you very much. Thank you for all of the thorough information not just on, uh, uh, uh, Spike, Spikefax but also on the pipeline. I guess my first question has to do with where, capacity, and really trying to understand a little bit more fully what goes into continuing to grow capacity, especially overseas. And I guess the second question would be, um, with respect to the Orphan Disease Pipeline, which is, you know, I think you guys know, it's one of my favorites just in terms of application for MRNA. How can we be moving faster there?

Uhm I'm, sorry, I I missed the second question could you just repeat it yeah, similar I guess and flu that when you have data later this year I suspect you believe the tighter levels would be extremely high I think there's some better understand English for regulatory guidance documents that for fluid, there's some acceptable levels and you could certainly.

Compare it to approved products that high levels, there would be supportive of a larger study in a in a fast path hot market.

Edward Andrew Tenthoff: Again, appreciating that you guys have a pandemic you're trying to address, but it seems to me like everything's set to go there, and I'd just curious what we can be doing to maybe accelerate some of those important programs. Thank you so much for taking the time to answer my question.

That's right, yes. Thank you for reminding me Uhm. So we obviously, we haven't provided guidance on when we expect.

The the.

To be able to get through those subsequent studies and and ultimately would that regulatory path is because we have to engage in that discussion with the F. D. A and global regulators and those are ongoing and so it's really subject to them agreeing but I would agree with your characterization. It's certainly our hope in view that because it's a well understood market with things like the Hai titers that.

Stephan: Yeah, maybe I'd take... Oh, go ahead. So Ted, I'll take the capacity, and then, Steven, we'll talk about where this is. So as you recall, Ted, you know, we announced, I think it was in February, based on market feedback from countries, given the high efficacy of our vaccine, there was a lot of demand. And so, if you recall, we decided to make a very significant manufacturing capacity increase, you know, 50% addition in the U.S. It's all at our US sites for drug substances in our wood and then the dabbling of the OUS capacity at Lonza and Roving.

Even a a new platform like messenger RNA might be able to leverage some of that thinking in terms of immunogenicity and safety as we think about moving for it to approval will ultimately have to show efficacy and real will that because he as well because that's what it's gonna be of interest for payers, but uhm, but again the regulatory path is going to be subject to discussions with regulators that are.

Ongoing so I can't provide more guidance at this time.

Thanks.

And your next question comes from the line of gender wall from bark places for line is that okay.

Thank you I have a 3 quick question if.

Stephan: Our goal is to, as I said in my remarks, depending on the booster dose, which until we get the final stay by the regulator and until we see the 100 macogram data for 1273 the third dose, as Stephen described, we won't know for sure. But if you're more than both the Prime Series APs that have already been ordered, which would be, of course, at 100 micrograms. If you model what we anticipate in the mix between Prime Series and booster vaccines for SpikeVax,

The first 1 is if Bruce Sean come out to be 50, microgram should we do expect similar price range amount of free package doing pandemic, Frank and then number 2 is could you walk through the clinical trial development path for a single shot vaccine against cold and flu and I for me.

And <unk>.

Question is that'd be calling to external investment opportunity you mentioned that explaining to 2 new Moore Talipes long and I hit my complaint is stenhouse Jean <unk> accounting for me focusing in <unk> condemning you are willing to explain to the liver diseases.

Stephan: If a booster dose was 50 micrograms, we could have up to 3 billion doses of supply, and if the booster dose was 100 micrograms, that could take us up to 2 billion doses. So that's a bit hard to think about it.

So let me take my first question Gina on the boost.

The the prices North link to amass so we had to pay the price of boosting to be set up.

Stephan: But what we're trying to do is not have the challenge we have this year, which is a happy problem. As I think in my remarks, you know, we are still tracking for 800 million to a billion doses this year. But I've also said that we are not taking any more orders for 2021 because we are totally maxed out. And, of course, we would want to be in that position.

And no tomato to those.

I live Stephen talk about.

The the second question if that's okay.

[noise], so I'm happy to take that question. Stefan This is Jackie and it's around the clinical development plan for a booster combination vaccine and the good news is there have been multiple combination vaccine developments in the past.

Stephan: Where we can answer to any countries wanting more vaccines. And so by doing those investments, we really are hoping that next year, we can make sure that we can fulfill all the demand we're going to get from the market. And as Corrine mentioned, you know, while we have already signed $12 billion for 8 years for next year and days, with those countries an additional $8 billion on top of the 12 options that those countries have, there are still a lot of discussions ongoing.

Not for this kind of a groundbreaking indication, but typically what we do is license. The initial components first and you know that we are working on a b L. A for Covid, we are preparing face T..3 for flu and for our C. And then we would look to license the combination.

<unk> vaccine 2 Immingham French Inc.

Thanks for checking.

Anything I would go as to sound good.

I was gonna take genetic unless you want to stick on Uhm, 1 comment 2 on Jackie's point, we already do have combination vaccines like H O P. P. I V that 3 vaccine, so where we hopefully we do have some experience or technically on the G. Net in question. Yeah. We we do have as you know programs that target the liver, but as we presented a previous science day.

Stephan: And so what we want to do is to maximize the penetration of spikebacks around the world. And I believe that the new data this morning showing that the efficacy, the final efficacy of the cost studies holding very nicely, I think we'll just be yet another argument for countries to want to vaccinate as many people as they can in that country with 1270. Yeah. That's helpful. Stephen?

<unk> and and even today, we have a we have a platform technologies also we think allows us to get and broadly into the immune system and particularly come out of blood stem cells, and so what you'll where we imagine our strong suit to be is in delivering nucleic acid technologies to those areas and of course, as we look to expanding and <unk>.

Stephen Hoge: You want to talk about... Sure. Yeah, I mean, Ted, I think you know we've had a longstanding commitment to these populations, and that's as strong today as ever. And we hear and want to do everything we can to accelerate these medicines for them. It's important to say this, you know, fast to the finish is the goal, not fast to the start.

You'll see us look to those technologies that we've got the most experience with first and and then bringing a range of different pillows to into our capabilities.

Thank you.

Next question please operator.

Stephen Hoge: And while we're pleased with the start of the propionic acid accedonia program and hopefully, shortly, MMA and others in the clinic, you know, our goal is obviously to rapidly move through those phase one studies that find the right dose and hopefully then rapidly move into pivotal studies. And as you know, that can happen very quickly.

[noise] operator.

Hello, operator.

Levine I think that's where I'm nosey up there I thought I hope yeah, sorry.

Yeah.

Stephen Hoge: And so, particularly in rare diseases, particularly with some early positive clinical data. And so that's what we're trying to do right now, is anticipate that positive data, expand and build out our team in that therapeutic area, and begin the more foundational preparations for closing very quickly if we can get some encouraging positive clinical signs. But working every day to try and accelerate that process.

Cori for me.

If you are on line can you please I need yourself and ask your question.

Okay apologies, everyone. We seem to have lost the operator, and and I'm 25 minutes past the hour.

Back to set for Lance out to make closing remarks.

Stephen Hoge: the time to those is incurring early data and, you know, as well as, as I said, prepare for that. Fair enough. Thank you, gentlemen.

Okay, I'm, sorry that sorry, everybody for us to hearing us for the technical Department I'm, what would work for <unk> provides up to figure out what would happen. If you have any follow up question. Please don't hesitate for Kentucky Melvina, we'll make sure to read back to you quick day. Thank you for coming into a day and we look forward to talking to you and then they can call on your day off September 9th.

Michael Yee: In your next question, from the line of Michael Gee from Jeffreys, your line is now open. Hi, good morning, thanks for the questions. Two questions. One on boosting.

Michael Yee: Do you guys have a good sense of what the regulatory view or hurdle is to support boosting? You show that great data on slide 30, showing the waning of the antibodies, and I think we all see that could be a problem and how the third dose gets you way up. But what do you think the specific data is, or put another way, the tighter level for correlative protection would be to support boosting for the fall or the winter?

Thanks for you and have a great day alright.

Michael Yee: That's question one. And then question two, a little bit similar, on flu, with that data coming up later this year, is it your view that significantly higher levels of antibodies will lead to significantly higher efficacy, and that with just a larger study, that will also be supportive of a launch, I think you said, in 20203. Thank you.

Stephen Hoge: Sure, so I'll try and take the first question, which was, you know, as you point out, well, we do not currently have correlative protection in the world, unfortunately, for any of the vaccines, and so it's very hard to say objectively, what tighter, what level is this sort of minimum level. Which is why, in our minds, and, you know, subject to the regulators to developing their own perspective, but in Let's look at the neutralizing titers that support that. And let's do even better. Let's get above those tiders.

Stephen Hoge: Because if we can exceed those tiders, where we were just after the primary vaccination series, then it should stand as a reason that we should be able to provide durable protection at or above the levels that we saw before. Now, of course, the virus is evolving, and that's where we see Delta, and we have to be humble about that. But the good news is, it looks like it will.

Stephen Hoge: in real world data that the vaccine 1273 is holding up against Delta, even with partial vaccination, as Jackie mentioned in her slides, with some of those references. And so we do think that, you know, getting at or above those levels should hold up quite well. How much above those levels? Is it, is it, you know, is it 1.0, is it 2.0? You know, is it some other number?

Stephen Hoge: I think that's, you know, ultimately going to be a sense that we want to have between ourselves of the data that we have, the benefits of the different dose levels, 50 microgram or 100 microgram, and, you know, again, the data we've already seen in terms of phase three, and then a dialogue with regulators about how they see that benefit. But as it stands today, we think the 50 microgram data that we presented really looks encouraging and will likely meet that standard.

Stephen Hoge: But we want to hold off, look at the 100 microgram data in just a few weeks here and decide, nope, that's the right call. We've got to the levels we need to, and we think we can reset immunity in a vaccinated person with a third dose at or above the levels that have been driving this durable protection.

Stephen Hoge: Yeah, similar, I guess, in flu where when you have data later this year, I suspect you believe the tighter levels would be extremely high. I think there's some better understanding based regulatory guidance documents that for flu, there are some acceptable levels, and you could certainly compare them to approved products, and high levels there would be supportive of a larger study and a fast path market. That's right. Yes, thank you for reminding me.

Stephen Hoge: So we, obviously, we haven't provided guidance on when we expect to be able to get through those subsequent studies and ultimately what that regulatory path is because we have to engage in that discussion with the FDA and global regulators, and those discussions are ongoing. And so it's really subject to them agreeing. But I would agree with your characterization, and it's certainly our hope and view that because it's a well-understood market with things like the HAA Tiders, that even a new platform like Messenger RNA might be able to leverage some of that thinking in terms of immunogenicity and safety as we think about moving forward to approval.

[music].

Stephen Hoge: We'll ultimately have to show efficacy and real-world efficacy as well because that's what's going to be of interest for payers. But again, the regulatory path is going to be subject to discussions with regulators that are ongoing. So I can't provide more guidance at this time. Okay. For your next question, the control line is Janna Wong from Bark Place. Your line is now open.

Gena Wang: Thank you. I have three quick questions. The first one is, boost shark turned out to be 50 micrograms; should we still expect a similar price range among the three buckets during Penn?

Gena Wang: And then number two is, could you walk through the clinical trial development path for a

Gena Wang: path for a single-shot vaccine against COVID flu and RSV. And the third question is that regarding external investment opportunities. You mentioned that expanding to two new modalities, you know, lung and hematoporated stem cells, gene editing with lipidinanoparticle delivery, are currently focused on the liver. Does that mean you are willing to expand to liver disease?

Gena Wang: So let me take the first question, Gina. On the boost, the price is not linked to the mass, so we anticipate the price of boosting to be set up, and not related to that. I'll let Steven talk about the second question. Is that okay?

Stephan: So I'm happy to take that question, this is Jackie, and it's about the clinical development plan.

Jacqueline Miller: for a booster combination vaccine. And the good news is that there have been multiple combination vaccines.

Jacqueline Miller: developments in the past, maybe not for this kind of groundbreaking indication.

Jacqueline Miller: but typically, what we do is license the initial components first, and you know that we are working on our BLA for COVID, we are preparing phase two, three for flu and for RSV, and then we would look to license the combination vaccine through immunobridging. Thank you, Jackie. Thank you, Jackie. And I would... Go ahead, Stephen.

Jacqueline Miller: I was going to take the gene editing human, but on one comment too, on Jackie's point, we already did, vaccines like the HMPPF3 vaccine, so we hopefully do have some experience there technically. On the gene-adding question, you know, we do have, as you know, programs that target the liver, but as we've presented at previous science days and even today, we have a platform technology that also, we think, allows us to get it broadly into the immune system and particularly hematopotic stem cells.

Jacqueline Miller: And so where we imagine our strong suit to be is in delivering nucleic acid technologies to those areas. And of course, as we look to expand in gene editing, you'll see us look to those technologies that we've got the most experienced first and then bring a range of different technologies into our capabilities. Thank you. Next question, please

Stephen Hoge: Next question, please, operator? Operator? Hello, operator?

Operator: Lavinai, it seems that we have lost the operator, I hope. Yes. Sorry? Correct. Corey from J. Kori from J. If you are on Mind,

Operator: Corey from J. If you are online, can you please unmute yourself and ask your question? Okay, apologies, everyone. We seem to have lost the operator, and it is 25 minutes past the hour. So I will hand this over back to Stefan Bansel for him to make his closing remarks. Thanks, Lavinna. Sorry, everybody, if you're still hearing us with a technical problem, we will work with a provider to figure out what happened. If you have any follow-up questions, please don't hesitate to contact Lavinia.

Operator: We'll make sure to reply to you quickly. Thank you for coming in today, and we look forward to talking to you at the latest on R&D Day on September 9th. Thank you and have a great day. Bye.

Stephan: Thanks, so, everybody if you're still hearing us, technical problem. We will work with a provider to figure out what happened.

Stephan: If you have any further questions, please don't hesitate to contact Lavinna. We'll make sure to reply to you quickly. Thank you for coming in today and we look forward to talking to you at the latest on R&D day on September 9th. Thank you and have a great day. Bye.

unknown: and the and and I'm and I'm and I'm and I'm I'm I'm I'm I'm I'm I'm I'm I'm I'm I'm I'm I'm and I'm I'm I I'm I'm I I