Q3 2022 BioNTech SE Earnings Call
The conference will begin shortly to raise your hand during Q&A you can dial star one one.
[music].
Yeah.
The conference will begin shortly to raise your hand during Q&A you can dial star one one.
[music].
The conference will begin shortly to raise your hand during Q&A you can dial star one one.
[music].
Okay.
Welcome to the biotech third quarter 2022 update call I would like to turn the call over to the Vice President of Investor Relations and strategy. So you come off. Please go ahead Jessica.
Thank you all for joining us today yesterday, but you all third quarter operational highlights and provide you a financial update.
It's an exciting place corporate development, we are delighted to share our brokerage switchgear.
A few housekeeping items before we stopped.
Might you just use the slides that accompany the webcast at the first quarter 2022 press release.
Which were issued this morning can be found.
In the investors section of our website.
Secondly, the first look at slide two I would like to remind you that your today's presentation would make several forward looking statements.
These forward looking statements include but are not limited.
COVID-19 vaccine revenues.
She got a degree from preliminary estimates the lifestyle partner.
Estimated financial results for 2022 continued global demand for COVID-19 vaccine expected COVID-19 vaccine production plant in deliver 2022 and beyond.
The plant that's in our pipeline programs.
The timing for enrollment.
Importantly data from our clinical trials the timing of.
Our ability to obtain and maintain regulatory.
For our product anything and.
Uh huh.
And all the filings made with the U S Securities and Exchange Commission, including almost recent quarterly report filed today.
Actual results could differ from those because you anticipate.
Well, therefore cautioned not to place undue reliance on any forward statements, which speak only as of today sure today during the conference call and webcast.
Also please note that slides three and talk about details an important safety information regarding our COVID-19 vaccine.
Finally, today's agenda.
On slide five.
It is my pleasure to welcome the biotech management team, who will guide you to our third quarter update.
I'm joined by worst Shaheen co pharma biotech.
<unk>, our chief Medical Officer and co founder.
Ken Stein, our Chief Financial Officer, and Brian Richardson, our Chief strategy Officer.
With that I would like to turn the call over to Bill.
Thank you Erika a warm welcome to all pockets.
Today's conference call.
I'm pleased to update you on <unk> operational progress during the third quarter 2022.
Before I start let me review the fundamentals of our success.
Deep expertise in immuno oncology, our scientific rigor or fully integrated spectrum put great No research and manufacturing competence.
We succeeded to go down as our partner Pfizer in developing and supplying value streams globally.
We did so.
Incidentally to speak.
Since <unk> inception.
Our vision to establish a fully integrated global immunotherapy powerhouse.
Turning to concrete ties into survivor.
Photo a technology agnostic solution focus more multi platform strategy.
Our innovation engine, leveraging various emerging technologies and top quality approach.
Our aim is to address high unmet medical needs.
Crunchy infectious diseases and beyond.
We are advancing.
Mastercard product pipeline Immunotherapies and are facing an unprecedented opportunity to accelerate our progress towards our long term vision.
Bring the next generation of Immunotherapies to patients.
Moving to our third quarter highlights.
We reported total revenue of <unk>.
<unk> faster in yogurt.
Contributing to total revenues of 13 billion.
The first nine months after year.
This performance can be attributed to the continued successful execution of our COVID-19 vaccine franchise.
Reflects shipments of the omicron adapted vaccine booster, which started early in September .
We are updating our 2022 financial guidance by raising our vaccine revenues.
Eight to 16 to 17 billion.
We have expanded our team to more than 4000 employees.
Thanks.
We are expanding our global manufacturing network to ensure access to our innovative medicines.
We recently signed a letter of intent with RDF state of Australia for strategic partnerships.
And on the research and innovation Center and have two countries encouraging academic research into the clinic.
We will establish one of our module that buy on piano manufacturing facilities in marathon to enable end to end clinical scale manufacture product.
Product candidates.
Crunchy.
Security across our broad pipeline.
A total of 19 candidates.
<unk> four ongoing clinical trials, including five phase II trials.
Third quarter, three new programs in that space.
At this year ESMO conference in September we presented another positive clinical updates for P&C to 11 for the treatment of solid tumor.
To share more detail on the data update momentarily.
Slide seven highlights our quarter feet podcast with our COVID-19 franchise.
This quarter, we and our partner Pfizer continue to built on our global COVID-19 vaccine leadership. This first to market on a can be a four five adaptive vaccine launches across multiple countries and regions.
As of midnight.
October 2022, with approximately 300 million doses of our PD one <unk> four five adapted by the FCC.
With multiple regulatory developments.
Our original comment on occupancy.
Vaccine is undergoing conversion to full market approval in several regions around the globe.
<unk> received full marketing authorization in the EU for all existing and upcoming indications and formulations.
Ali the received EC approval for free dose primary serious in children age six months to five years in the EU and booster dose for children age five to 11 years.
A booster dose was recently approved by the ECB for individuals, it's SaaS and older.
This regulatory approvals our COVID-19 vaccine is one of the broadest labors.
Available vaccine.
Our only can be for fast five at an X gene boosted now has approval for use in more than 45 countries and regions worldwide.
Recently reported initial positive data at the 30 day, plus boost time pump in the phase II clinical.
Clinical trial of our on a couldnt be for fast adapted bivalent vaccine.
<unk> SaaS.
SaaS is in order.
Additionally, we initiated a phase 123 kind of the army can be a path that the bivalent vaccine in children.
Six months to 11 years.
The end of October as part of our ongoing collaboration we and our partner Pfizer.
We initiated a phase one clinical trial evaluating our army can be.
Adapted fiber in combination with Influencers.
Influenza vaccine.
<unk> influenza vaccine candidate is also part of the Sky.
Now advance to phase III clinical testing after a positive data from the phase II trial.
We have reported in second quarter of this year slide eight highlights our COVID-19 vaccine execution on a global scale.
And on a platform and established courses allow for development testing and manufacturing variances adapted vaccine.
And precedent that speed.
Part in a rapid regulatory path.
Parents of Omicron end of 2021, we and Pfizer.
Uhm Monovalent and bivalent vaccine directed against on a consolidated.
In other place of staff costs to date.
Data from this study were presented two regulatory agencies in June and July 2010 to two with supported Regulator's definition of the most appropriate regulatory pathway. It took.
As approximately two months to go from the first regulatory recommendation for B four five adapter to X gene.
Shipments of the respective <unk>.
The ability to execute the such as speed was enabled by three sector.
Our continued surveillance and analytics of variance of contour.
Cancer, and proactive COVID-19 clinical program and as a pet manufacturing adaptation.
Got it positioned to supply countries and regions around the globe.
I think our team and collaborators for their tireless efforts to make this accomplishment possible again in such a short period of time flat nine the midpoint only can be for fast adapted boosted supported by current research, including our own data as shown on slide nine in the northern hemisphere.
We tend to see case number steady devising epidemiologically speaking for fast and the related supply and it has continued to be the dominant plan and I couldnt be a four five adapted by Valens vaccines may also consider a robust protection against potential future emerging on the consulting firm.
Variance of concern that are closer to the tax credit.
Since neutralization breath, maybe driven by expansion of memory b cells against Epitope Shedful EMR variance.
That is in part induction of de Novo immune responses against new epitopes.
<unk> expansion and preservation of T cell responses may protect against severe disease.
Looking at the evolution of COVID-19, pandemic and current year that evidence the anticipate a long term need for any seasonal valued at depth booster.
If the bias in our state continuous evolution.
So ability of a new wave of infections driven by novel immune if he has a footprint remain.
Vigilant in monitoring the landscape and are prepared to adapt our vaccine as needed.
The risk of severe COVID-19 disease remains high in the vulnerable population.
The full extent of the prevalence of COVID-19 patients who go on to experience longer term have consequences.
Also not yet fully understood.
Clinical data have demonstrated that booster extend the protection offered by COVID-19 vaccine.
Which research has shown natural immunity acquired desktop to infection is valuable across individuals and the protection is.
It offers things over time.
The booster restored and enhanced infection acquired immune protection and further reduce it.
Of the infection.
Slide 11 shows our claims up to support a sustainable vaccine business in future.
First we have demonstrated the safety tolerability and efficacy of our <unk> on a COVID-19 vaccine.
We have shown our ability to rapidly adapt our products and processes to address emerging variants of concern.
Our expertise in navigating the evolving regulatory landscape on a global scale has positioned us as a first mover.
Enabled us to achieve one of the broadest label among currently available COVID-19 vaccine.
As to both the origin of commonality vaccine and our omni can be for fast adapt <unk>.
First with continued innovation, we are improving the already strong product profile of our COVID-19 vaccine targeting continued protection from current and future viral threats.
These four pillars are built on our validated on a platform of proven science discovery development manufacturing and commercialization and position us for success.
As we continue to expand and advance our pipeline and beat our 20 <unk> century immunotherapy powerhouse.
With that I would like to thank you all for your confidence in our success and your continued support and turn the call over to ASLAN.
Thank you Glenn.
Right.
Provide you with our COVID-19 vaccine pipeline update to date.
Slide 13, we have our largest bond innovation strategy.
Okay.
The evolving pandemic and improve upon our vaccine with next generation approaches that generate proto and module.
We have successfully done that.
First varian did that affect the scene to address Amit can be a one P F.
Right.
We believe that our opex has potential to be combined with it.
Across many of our go forward feedback R&D, we see thing the only corn detected vaccine booths that at the same time at natural shop health agencies, including the U S.
Now let me comment.
Question of COVID-19.
What is the annual influenza vaccine combination product has the potential to provide protection from both filed with US with a single shot we are working together with our partner <unk>.
To develop an influenza combination vaccine, which leverages our mrna technology in the midterm. We are also developing next generation engineered vaccine candidate.
Hi, Brett.
Okay.
And provide wanted user protection. This includes enhancing vaccine candidate.
Engineered type fixed income call option.
Our approach is supported by insights from content.
Varian and robust clinical program.
On slide 14.
Our innovation strategy has already yielded success with omnicom be a swap.
Adapted bivalent vaccine approved for use in more than 40 countries central region around the world.
The rest of the extra absorption that Aqua highlighted we are continuing to broaden the label.
Well.
Adapted by data in vaccines.
Different age group. This includes FDA emergency use authorization for individuals H twice over that in the U S and the EU.
We received.
Marketing authorization for individuals aged 12 and older.
Submissions for Hs.
In the EU has been completed and we are waiting to see HMP recommendation.
As a next step we plan.
Rich data to regulatory agencies from our ongoing trials in aged six months to five years in the first quarter of 2023.
And except to our own front and adaptive bivalent vaccine two young children.
Our regulatory activities as supported by our ongoing clinical program evaluating the da four five adaptive.
In various scope.
Slide 15 highlights the positive data in the ages 18 and older cohort reported from the ongoing phase two trial of RMB four five adapted.
Is that an individualized 12 years and up.
The study was initiated in August .
Approximately 900 healthy volunteers.
Plus and OTA.
<unk> had already received at least three dose.
<unk> COVID-19 vaccine.
Either Turkey, or 60 micrograms of RBA 45 debt to EBITDA.
Well I'll, let you know that.
Great.
And the lesson H.
<unk> received a 30 microgram dose also omicron adaptive vaccine although rich.
The data, it's a 30 day time point.
From the center Nicole.
Which included 48.
In each age group 18 to 55 years of age and older.
Five years, each having received thus far 10 microgram dose also bivalent vaccine to conquer rate. Our group included 40 into the individual over 55 years of age.
Please go original VIX.
Data shows that the safety and Tolerability profile.
<unk> came with it and similar to what I originally.
On Slide 16, you can see the titers of neutralizing anti body broken down by age group and <unk>.
<unk> explanation.
Why the 18% to 55 year old had had a $9 five fold increase over baseline.
<unk> as a whole the increase was notably higher namely 16 forward.
Our baseline negative.
And the individuals who were older than 55 years.
Group as a whole experienced approaching two fold increase in neutralization titers.
As for individuals who were negative at this time.
28 feet tall.
<unk> increased.
This first one.
We're higher than that.
Other than those observed in the contrary Tao group, receiving will enrich the vaccine who saw a $2 nine fold increase over baseline.
Was not much difference between the groups who were negative.
At baseline in the <unk>.
Contrary to.
The reference trained neutralization titers.
As high as that observed.
Those who receive so operationally.
Overall.
I saw a substantial increase in with funds will survive valent vaccine compared to the original vaccine and the improvements were most pronounced in those over age.
<unk> 55, and those who have baseline negative prior to vaccination.
Given that Amit.
They fall five invest have been or just continue to be the dominant circulating strains.
Data provides strong evidence of the protection that thing with the bivalent vaccine Ken for rights to <unk>.
Particularly.
<unk>.
Slide 17.
Second pillar of our innovation strategy.
Our collaboration with Pfizer to develop a COVID-19 is going to start combination vaccine based on <unk>.
Mrna technology.
Phase one clinical trial has been initiated.
Uhm safety, Tolerability and Immunogenicity of <unk>.
RNA quadrivalent influenza vaccine candidate in combination with our omni crombie, a four <unk> debt to <unk>.
We are building on the experienced late in the <unk> 161 program <unk> developing an influence.
As Warner Valent vaccine.
Which are phase III trial was initiated by 5% in September .
And the combination of Tri Ed.
The quadrivalent influenza vaccine candidate.
Okay.
But as trends in two times the strength.
Has been selected for the currencies.
<unk>.
100 <unk>.
H 18 to 64 layer and load across six trials to test various combinations of the influenza vaccine candidate and so on the front of that.
<unk> ataxia and 60 microgram dose.
Influenza vaccine candidates individually stand that license.
<unk> seen.
At the contrary Tom.
Slide 18 details.
Our two development <unk> to create next generation X, one SEC influence or engineered type protein vaccine candidates designed to address that.
Broke neutralizing antibody protection against the vast array of variance, including those which has not yet invoiced, yes, that's right.
And candidates designed to enhance the T cell response against that.
First <unk> candidate for this program the <unk> it will be four target markets at highly insightful.
On slide 14 that has been selected based on their potential to engage with T cells of the immune system. This approach has the potential to increase enormous resilience.
The important T cell response.
Like memory T cell persistence and durability of this headwind.
The clinical trials.
Combination with our omnicom the four five to five <unk>.
Correct.
The coming weeks slide.
Slide 19 highlights our interesting Scott.
In addition to the previously mentioned COVID-19 vaccine trial initiation.
The third quarter, we expect the start of market. This first in human trials.
Hey vaccine candidates over the coming months.
This includes our Shanghai and HSV, two vaccine candidate, which I <unk> to enter the clinic in the final part of this.
Yes.
Im sorry, a vaccine candidate try it either in the fourth quarter of 2022 or early 'twenty three.
I wanted to quit always this vaccine candidate expected to dose the first patient in early 2020. These programs to date on how a validated platform of nucleoside modified mrna lmt's with optimized checkpoint designed to address diseases with a significant growth.
Moving to our oncology program update.
Slide 20 provides an overview of our oncology pipeline that is grounded in or my team will journalistic toolbox and advanced focused execution. We now have a total of 19 oncology product candidates.
Thus far different drug classes incentive for ongoing clinical trials.
Of which a randomized phase II trials.
Programs address areas of high unmet need in terms of potential <unk>.
Using complementary stretch produced by targeting tumor directly although modulating the immune response against the tumor many of our product candidates has the potential to be combined.
With other pipeline.
In the third quarter of 2022 preclinical.
Preclinical program advanced to phase one clinical testing. This includes therefore expect Kansas KPMG 116, plus second line treatment of non small cell lung cancer and or by specific cycle net product candidate.
142, plus other tier one.
In collaboration with Genmab, Sweden recently initiated a phase one study evaluating <unk>, one fee or anti CD 27 extra budget product candidate in solid tumor.
Immuno oncology Congress in December .
The 22, we expect to have two presentation. One was about flat and then there is safety data from the safety run in cohort.
Also studies that with randomization in the ongoing phase two.
Tired of our successful from BNP <unk>.
This trial is evaluating <unk> in combination with <unk> in patients with HPV 16 positive PDL, one positive hesitant next squamous cell carcinoma.
Although preliminary efficacy and safety data from another Gen net collaboration the phase one trial of <unk> 12.
Fortunately for one week into our pocket.
Solid Q1 finally, we have seen in Q2 it doesn't our next generation car T cell therapy product candidate.
Designed to overcome first generation car T cell therapies indication in patients with solid tumors.
Listen presented follow on data from.
In Q2 11 at the ESMO annual conference the Phase one dose escalation data continued to show encouraging clinical activity and safety.
Turning to slide 21.
<unk> 211, it's a chimeric antigen receptor directing T cells against the novel targets and fixed.
That alone and in combination with a car T cell amplifying RNA vaccine cause kovack and coatings volume.
How long is based on our yield and lowering his iPhone X technology used in other cancer vaccine candidate for firms.
So I didn't catch that.
First our second generation chimeric antigen receptor.
Sensitivity and specificity for the carcinoid embryonic tumor specific antigen.
Six.
But in six months.
And have you added tissue get frequently expressed in Highland medical need cancer, making this July antigen, an ideal candidate Hawkeye G. SIB TRP the ongoing first in human phase one two trial.
The safety and efficacy of coding car T cell.
One of your peer in combination with <unk> in patients with.
Positive.
Our refractory advanced Chihuahua.
Our dose escalation study testing <unk> service offering.
Cockpits that.
As monotherapy as well as in combination with a fixed dose of the RNA vaccine the expansion cohorts in patients with ovarian test fixture.
Endometrial cancer have been grandfathered six pause that just can't subtypes.
Slide 22 provides a summary of the ethanol presentation.
In short the data from <unk> heavily pre treated patients with classic car.
Car T cells at school dose 10, 10 to the Sevens and tend to wait.
In combination with <unk>.
Got it.
<unk> for the patients for treatment with TMT, that's new with the exception of two extra.
Cancer patients the car T cells at move your recipe and combined with Kovack were well tolerated adverse events included and I'm not sure of his title.
And one final quick one.
I can't dose limiting toxicities were observed in two patients both lab manage of it and the patients cornea recovered.
One was pollo pantry type of peanut dose level, two here where people in a patient with testicular cancer after item for the patient the second one.
<unk> and choice to aside towards it.
Those are the two combination group prior to application administration of Catholic.
And excellent tolerated dose has not yet been reached.
Observed dose dependent expansion of God. He said some odd patients.
As of August 16, overall response rate was 33% and disease control rate was 67%.
This includes one compete with 0.6.
Sure, Wisconsin, and seven patients were stable.
We are particularly encouraged by the observed activity in patients with testicular cancer.
The 10%.
Our T slim leather after depletion of seven.
Many of the testicular cancer patients included in the analysis, one hedge a confirmed complete response three partial responses and two have to pay for it.
I think in the disease control rate of 85% and then overall response rate of 57%.
Slide 23.
<unk> investment and expansion of a smooth cut keeps us in all patients with <unk>.
Tom Glavine, hundreds and in some cases 200 days, including the patient with a complete response shown here.
In case of car T cells, we draw.
Upon the successful as shown here.
Turn to the second dose.
Slide 24 highlights.
So patients where we saw encouraging signs of activity with impressive Q1 shrinkage as you can see in these cities.
Well it hasnt patients with particular cancer, who received <unk> certification regimen, the risk once rates reached 45% and even 57% when looking only exiting the aged car kicked that off the disease control rate was 85%.
It's a $10 eight car T.
Can you talk to that one patient at that point with hockey dose level was assessed by the investigator having a complete response at 12 weeks. This complete response continue.
Confirmed at the 18 week and 52 week time point.
We are very encouraged by the safety and clinical activity data from this promising program turning now to slide 25.
Next generation immune modulator class network churn with this program, which aimed to prime and activate antitumor T cell and natural killer cell assumption are continuing to advance <unk> 212. This conference. We're just announced earlier today, we will present a poster highlighting preclinical.
That supporting BMG for either or.
Our bispecific antibody designed to assist the condition for.
Well when we do close simulation concurrent with PD one blockade.
Additionally, an abstract of preclinical data demonstrating the mechanism of action of PMT.
<unk> has been accepted for poster presentation at <unk>.
<unk> is an anti <unk>.
<unk> is an anti.
I believe that carries a heck summarization enhancing domain to support anti body mass mass formulation that drives CD 27 clustering on the T cell surface necessary condition. TMT 13 is designed to induce CD 27 agonist activity.
Without binding to <unk>.
Gulf Island sector with Leerink.
Second then he says he patients.
Phase one clinical trial of <unk> plus initiated with one.
As <unk> mentioned our balance sheet.
This program an abstract has been accepted for presentation at the ethanol.
Oncology Congress in December .
Overall, the progress of these programs is very encouraging for us.
I look forward to.
<unk> additional program updates in the coming in coming months I will now pass the.
A presentation to our CFO and Todd Stein, who represent all financials with that.
Thank you Ashwin and a warm welcome to those of you on the phone.
I would like to begin by presenting the key financial highlights for the third quarter of 2022, which you can find on slide 27.
Our total reported revenues for the third quarter reached $3 5 billion euros.
Together with our strong first half year, we are in line with our prior year revenues for the year to date figures.
I will elaborate on this shortly.
Given this topline number we delivered operating income of $2 4 billion euros and generated earnings per share on a fully diluted basis of six euros 98.
With respect to the company's liquidity position. We ended the third quarter of 2022 with $13 4 billion euros of cash and cash equivalents as well as trade receivables of around seven 3 billion euros.
The trade receivables, primarily derived from our collaboration with Pfizer and remained outstanding due to the contractual settlement of the cross profit share under the collaboration.
As of October 15th we collected $3 2 billion in cash from our outstanding trade receivables at September 30th improving our cash position and in turn reducing our trade receivable position subsequent to the end of Q3.
Continuing with slide 28.
We recognized $3 4 billion euros of COVID-19 vaccine revenues during the third quarter and $12 9 billion during the first nine months.
Revenues for the first nine months in line with our expectations.
We believe the development of the pandemic has been and remains dynamic, causing the re phasing of orders and with this fluctuations in quarterly revenues.
Let me give you some more details on our revenue streams.
And our COVID-19 vaccine collaborations territories have been allocated between us and.
Pfizer and Fosun pharma based on marketing and distribution rights.
Our COVID-19 vaccine revenues included $2 5 billion euros for the third quarter and $9 1 billion for the first nine months that are related to our share of gross profit from COVID-19 vaccine sales in the collaboration partners respective territories.
These revenues represent a net figure which means we generate 100% gross margin on those revenues.
As we have mentioned in the past and explained in more detail in our financial statements and filings with the SEC. Our profit share is to some extent estimated based on preliminary data shared between our collaboration partner and us.
The gross profit share is also impacted by write offs. So for example for vaccine doses produced by our collaboration partner <unk>.
Those write offs reduced gross profit share between the two companies and therefore reduced biotechs revenue figure, but not those of our partner Pfizer.
Our COVID-19 vaccine revenues from direct COVID-19 vaccine sales to customers in our territory.
<unk> <unk> 6 billion euros for the third quarter and.
$2 3 billion for the first nine months.
Those revenues was significantly driven by the orders that were placed in late 2021, following the denim merchant on the conversion.
And the Omicron adapted vaccine launches started beginning of September 2022.
Also included in our COVID-19 vaccine revenues were <unk> 3 billion euros for the third quarter and $1 5 billion euros for the first nine months of revenues from sales to our collaboration partners.
Now I'd like to move on to our detailed financial results for the third quarter and first nine months of 2022 as shown on slide 29.
As I discussed revenues in the previous slide let me move to cost of sales reached approximately one 8 billion in the third quarter of 2022 compared to $1 2 billion euros for the comparative prior year period.
For the first nine months of 2022, the cost of sales reached approximately $2 8 billion euros compared to $2 3 billion euros for the comparative prior year period.
The change in cost of sales resulted mainly from the recognition of costs related to our COVID-19 vaccine revenues in our own territories.
<unk> the share of gross profit that we owed to Pfizer.
In addition cost of sales were impacted by expenses.
Rising from inventory write offs and expenses for production capacities to rexam contracts with contract manufacturing organizations.
Research and development expenses reached $341 8 million euros for the third quarter of 2022 compared to $260 4 million euros for the comparative prior year in 2021.
For the first nine months of 2020 to research and development expenses amounted to 1 billion compared to <unk> 7 billion for the comparative prior year period. The increase was mainly due to the increased head count and higher expenses in the context of the share based payments.
General and administrative expenses reached 141 million for the third quarter of 2022 compared to $68 2 million for the comparative period in 2021.
For the first nine months of 2022.
Administrative expenses reached $361 8 million compared to 154.9 billion euros for the comparative prior year period.
The increase in G&A was mainly driven by the planned increase in head count and increased expenses for purchased external chips.
Income taxes were accrued with an amount of <unk> 7 billion for the third quarter of 2022 compared to $1 5 billion euros for the comparative period in 2021.
For the first nine months of 2022 income taxes accrued with an amount of $2 6 billion euros compared to $3 2 billion for the comparative prior year period.
The derived effective income tax rate for the first nine months of 2022 was 26, 8%.
In the third quarter of 2022 net profit reached one 8 billion compared.
Compared to $3 2 billion euros for the comparative period in 2021.
And the first nine months of 2022 net profit reached seven 2 billion euros compared to $7 1 billion euros for the comparative prior year period.
Our diluted earnings per share for the third quarter of 2022 amounted to six euros and 98.
Compared to 12 years 35 years since for the comparative period in 2021.
For the first nine months of 2022 diluted earnings per share was 27, and <unk> 70 euro cents compared to <unk> 27 euros in 46 years since in 2021 now.
Now, let's move to slide 34, the outlook for the 2022 financial year.
We are updating our 2022 financial guidance raising our COVID-19 vaccine revenue estimate for the full year to the upper end of the original range, 16% to $17 billion euros from 13% to 17 billion euros previously.
The narrowed guidance reflects delivery omicron step the bivalent vaccine booster, which started early in September and is expected to continue throughout the fourth quarter of 2022, as well as higher prices and a positive foreign currency effect.
We reiterate our planned expenses and Capex, which we have summarized for you on the slide.
We also update the estimated annual effective income tax rate from previously 28% to approximately 27%, which is a further improvement to previous year.
Moving to the completion of the first tranche of our share repurchase program as shown on slide 31.
The share repurchase program approved by the management Board and the Supervisory Board submits.
Amidst the repurchase of <unk> value of up to $1 $5 billion over two years, our intention is to use some or all of the repurchase ads's two meet pending obligations from share based payment arrangements.
The first tranche of the repurchase program at a value of up to $1 billion and began on May 2nd 2022 and ended October 10th 2022.
As shown on the slide total of 6.945 million 538 were repurchased at an average price of $143 98 U S dollars, representing two 8% of the shares issued as of April 32022.
In addition, we have paid out a dividend of approximately <unk> 5 billion euros to shareholders in 2022.
In November the second tranche of the repurchase program with a value of up to $5 billion. That's been approved commencing on December 7th this year.
More information and an overview of the buybacks can be found on Opex side.
With that I would like to turn the call over to our Chief strategy Officer, Ryan Richardson for an update on our outlook for 2022 and concluding remarks. Thank you.
Thank you <unk> turning to slide 33.
Our COVID-19 vaccine continued to play a major role in addressing the pandemic with the launch of our Varian adopted before <unk> vaccine.
We and our partners have received approval in over 45 countries and territories since our first approval in August this year and have rapidly deployed approximately 300 million doses of our varian adopted vaccines as of mid October .
We've updated our full year 2022 order book and now expect to invoice up to $2 1 billion doses. This year, reflecting some re phasing of deliveries to early 2023 due to supply their abilities and projected uptake of our varian adopted vaccines.
By year end, we expect to fulfill both our existing contract with the United States government for 105 million doses and our contract with the European Union for $650 million.
As we turn to 2023, and we anticipate that the COVID-19 vaccine market will start to shift towards hybrid public private market with some geographies, namely the United States likely shifting to our commercial contracting model in 2023.
United States, we and our partner Pfizer expect the list price for a single dose vial of adult vaccine to be in the range of 110 to $130 per dose, reflecting both the cost effectiveness and public health value of our vaccine.
In the future, we expect seasonal demand to be weighted to the second half of the year consistent with other seasonal respiratory infectious disease vaccines.
As shown on slide 34, we continue to make progress against our 2022 clinical milestones.
As we enter the final months of the year, we expect a number of additional update some of which are shown here and on the following two slides.
In infectious diseases, we expect continued expansion of our COVID-19 vaccine pipeline with multiple next generation vaccine construct entering the clinic before year end.
We also expect data updates from our ongoing clinical trials evaluating our various adapted vaccines.
Outside of COVID-19, we plan for multiple mrna vaccines to enter the clinic this year and early next year.
By the end of 2023, we expect to have up to five new clinical trial starts and infectious diseases.
Turning to slide 35 in oncology alongside the first patient dosed in the phase one trial evaluating <unk> three our anti CD 27 extra body partnered with Genmab, which we announced today.
By year end, we also expect to have the first patient dose for a second phase one trial evaluating <unk> six in first line in SCLC.
Also will present, a clinical data update at ESMO Io annual meeting in December for <unk>.
Our CD 44, maybe dual body partner with Genmab.
As we look ahead to 2023.
Expect a busy year for our oncology pipeline with as many as 10 clinical trial updates across a diverse range of programs.
Concluding on slide 36, we expect 2023 to be a momentous year for biotech.
We will continue to invest for the long term in our next generation COVID-19 vaccine pipeline as we continue to deliver.
Are very adaptive <unk> seen around the world.
We will continue to expand and accelerate our innovative oncology and infectious disease pipelines in anticipation of multiple late stage data readouts.
And clinical trial starts that we expect will fuel future growth.
And with increasing balance sheet strength, which we expect into next year, we will continue to reinvest in the company to build world class capabilities and accelerate our growth.
We will also continue to look for additive bolt on BD and M&A opportunities that fit with our strategy.
We remain as optimistic as ever in our ability to continue to create long term value for patients our shareholders and society.
I would like to take the opportunity to thank our shareholders for their continued support and we'll now open the floor for questions.
Thank you.
As a reminder to ask a question you will need to press star one on one on your telephone and wait for your name to be announced please limit yourself to one question only once again star one on one if you would like to ask a question. Please limit yourself to one question only.
We will now go to our first question.
One moment please.
And your first question comes from the line of <unk> Ahmad from Bank of America. Please go ahead.
Hello, Good morning, Thanks for taking my question.
Can I just get some color from how long do you think that the current VA four five bi valent side is going to be in use.
Should we expect it to have any coverage of the newer variants like for example, the PQ, one or <unk> $1, one and if it doesn't how should we think about some of the shipments that you mentioned in your prepared remarks that have been shifted into 2023 with those be delayed until later next year.
Parties that are ordering or to have the right to delay shipment for a newer version of the vaccine.
Okay.
I would like to respond to your first question.
A question and testing with regards to how long the B a 451.
<unk> adapted vaccines.
<unk>.
Allow us to respond to the pandemic that will really depend on how the virus <unk>.
Some of our current city emerging.
Variance of concern.
Closely related with <unk> five off from the <unk> and there is some probability that there will be cross neutralization and cross protection against these variants we will continue to.
Sure.
That's by CROSSMARK neutralization assays, which are ongoing and Ken then same law, but it really depends on how the virus from my viewpoint.
Hi, do you.
Wanted to take the second question was should given answer yes.
Yeah, absolutely I can start over and so on the question of shifting of doses.
A significant portion of those doses that were shifted for delivery next year, we're actually donation doses to a variety of countries around the world. So really we see that dynamic is not specifically related to the various vaccine in question.
And generally speaking these contracts are flexible so while we see some of those doses shifted to 2023.
We still have a expect a significant proportion of contracted doses next year.
And beyond and that could be.
Those contracts conserve be served by again, either the current vaccine or future vaccines, if the future very vaccine as needed.
Okay, great. Thanks from Cowen.
Thank you.
We will now go to our next question.
One moment please.
And your next question comes from the line of Matthew Harrison from Morgan Stanley .
Hi, This is Steve from Matthew Thanks for taking my question. My question is as you think about the PCB data next year, what kind of what are the PFS difference would you like to see to think about moving it ahead. Thank you.
So just to clarify the question.
You referenced the PCB, so youre talking about the <unk> program.
Yes, yeah in melanoma in your questions just to clarify your question is what PFS improvement are we looking for yes, yes. Thank you.
Overall, some do you want to.
I think this is too early to give.
Two final thresholds are working with said that they show us we have to understand.
Any type of improvement is in line with the third of Comcast and the fear that was made in the first time that our noma.
<unk> this.
This understanding also with the progress that we have made in the in the manufacturing of our IMS platform. So the in the meantime.
Improved I'll go with them.
Reduced.
Turnaround time for the vaccine and came up with process improvements and this would also require discussions with Doe authorities.
To make the final decision later, but.
Caucus and Ken can just use the study to expand the clinical trial for a potential accelerated approval.
Customer can be cut.
Thank you.
Thank you.
We will now go to our next question I'm.
And your next question comes from the line of Chris Shipper, Tony from Goldman Sachs. Please go ahead.
Yes. Thank you very much recent media reports suggest the potential for distribution of your Covid vaccine in China with the initial target population being ex pats.
We're trying to better understand the potential scope of this opportunity thinking in terms of units and pricing can you number one give us any updates on development when perhaps your vaccine might be approved in China number two would this be an approval that might enable broader distribution to Chinese national.
And then on the price front helped us at all with anything that we can understand about the potential pricing in that market. Thank you.
Yes. Thanks for the question, Chris I think it's a little too early actually to give some specifics there we have seen some positive re.
<unk> engagement.
It has been reported.
We can confirm that we have been taking part.
So the discussions which are very positive.
It's still too early to say or to try to predict to what extent.
And on approval for equity ex Pat population could be granted when it might be granted what that would mean commercially so at this stage.
We're continuing to monitor the situation very very carefully and hope to provide updates in the near future.
Thank you.
We will go to our next question.
One moment, please and your next question comes from Jessica Fey from Jpmorgan. Please go ahead.
Hey, there good morning. Thanks, so much for taking my question on the COVID-19 vaccine market Madonna has talked about how they expect the cobot booster market to be in the range of 500 to 600 million doses per year not unlike flu.
Potentially a bit below that in 2023, and working up to that 500 $600 million thereafter.
Do you share that view that Covid vaccine volumes could trail that 500 $600 million range next year, but then increase in 'twenty four and beyond to something closer to a flu range. Thank you.
Yes, maybe I'll start David and I'll start with answering the question.
Hi, Mike.
Please go ahead.
I think we all know that the pandemic has evolved well this year and how it will evolve in the future is meeting very difficult.
So, but we all know that Covid is a deadly disease as much more deadly than float.
You see much higher debt raise that ace and we know from flu and elderly people in high risk patients will be for sure.
The population that means vaccination, but of course, everyone else too.
<unk> needs to be protected.
Again similarly.
So.
That's maybe the base first going forward I mean, all depends on if and how often additional variance will pop up and how severe those bearings will be going forward.
At some point.
It is there is a high likelihood of course that there could be a flu like business model coming up.
It remains based on what I said before on the on the fact that Covid is a deadly disease.
A large multibillion dollar market going forward and specifically with such an endemic scenario.
That the private market opens up we know that pricing will be very different to the current pricing that we had so there is upside in that end.
And in addition, maybe lost coming from my end.
I only think in Pfizer together has shown and has proven that we are well placed in the market. We have I think a very good market positions and we have been able over the time.
To defend our market position very well.
We are very confident that going forward. This remains a very sizable very good market for us.
You may want to add something I think you covered most of it I would just I would just second the notion that <unk>.
The 'twenty threes, it's not we're not going to yet be into a true endemic market because it will be a hybrid market with significant contracted volumes and also expect emergence of a private market on Saab.
I think the volume numbers that you have said.
Our plausible we have still seen evidence of higher uptake in the booster segment than for example, we see with flu.
And so if there is one thats one data point, there and obviously here, we do expect a very different price point versus the flu market. So I think those factors combined to create multibillion long term market opportunity that we expect that you just outlined.
Hum.
Thank you.
We will now go to our next question.
And your question comes from Dana Gray bars from SBB Leerink. Please go ahead. Your line is open.
Hi, Thanks for the question I wanted to ask about some academic locations that were posted as pre prints from the Baruch and homeland recently and they were on their own looking up the immunogenicity of the bivalent boosters versus another boost if a wild type monovalent when their data showed modest.
Increases in antibody titers with the bivalent booster much more modest than what you today have shown in the greater than 55 population.
I Wonder if you can talk about how you interpret their data.
And if it's.
Let's say is correct and that you did a very modest difference with the bivalent, let's say for younger people under 55, what does that tell you about the bivalent booster.
Boosters will be needed what kind of a booster we may need in the future. Thank you.
Hi, Dana.
Thank you for the question.
So first first of all.
Then to the pre print of course the study.
And we see we see.
The study is missing missing to differentiate between between individuals who have prior infection.
Without prior infection, and we have seen in our data that this is really important to come to conclusion.
Ah since individuals without prior infections.
Have a much higher <unk>.
Increase.
Increase this week at <unk>.
Got to the overall.
All forward.
Neutralizing titers in tire costs.
Yes.
As compared to those who have been who had.
Had prior infections.
So our data we have.
Published seven day data and.
One month data and the data are very consistent in.
In the groups.
Homogeneous homogeneous findings we are confident that the report that we made also with the larger number of subjects, even not not very large with a larger number of subjects.
That turned out to be to be.
To be the.
We are.
So just two.
Repeat the key finding is that so far in the elderly population.
A fourfold higher.
Increase in naturalization part as compare to the biotech and.
And we are talking here about the about the immediate anti body at this point, but you have also to consider that.
Every vaccination does that Valeant adept at X gene has the second effect.
Second effect is the interaction with that.
Clear delay of immune responses in farming of de Novo <unk> sponsored debt.
Later.
In the timeframe of.
Plus months, so belief, we believe that as in the flu case, we will need to have.
Booster market with Valeant adapted vaccine to retrain, the immune system to the new Valeant sequence.
And this can't be addressed by sticking to the existing existing.
Type vaccine.
Just two.
Also the PD findings that generated the bioplastics, even the boost of the virus vaccine.
It uses.
The severe disease space and reduces the mortality, but that means we got this data.
Immunizing boosting.
Right.
Or with this brilliant adaptive vaccines, we have.
The action of severe disease state.
And.
With the variant adaptive <unk>, we have now an evidence that the neutralization titers.
To be significantly higher.
Thank you.
We will now go to our next question.
And your next question comes from the line of our cash to Ari from Jefferies. Please go ahead. Your line is open.
Hey, good morning. This is <unk>. Thanks for taking our question Oh, we have one uncle their vaccine sales. So how many of the total 30 hanger Muni EU contracted Joseph remain to be delivered in 2023 also you mentioned some of your shipments have been pushed to next year. So in total home.
Many confirmed orders out there for next year.
So service model 2023 total legacy sales of around 10 billion do you feel you will be able to hit that number with ROIC 15 orders signed for 'twenty. One next week. Thanks.
So yes. Thank you for the question I think.
Ill start and then I think Jim <unk> CFO , Jonathan So I think you first asked about next year.
And the new contract and I think what we announced in our prepared remarks was that we plan to.
To deliver the number.
The planned doses for the EU this year that we plan for 2000.
And also completed the U S existing U S.
Contract that was announced earlier this year.
We are not disclosing in order book number for next year.
What we can tell you is that of course are signed overall signed orders have continued to grow throughout this year overall, regardless of the delivery time period, but we're not guiding at the moment towards the future order book, because we think it's premature to do so and frankly.
Not relevant or not as relevant now given that the demand picture continues to be dynamic.
That we continue to.
Expect the emergence of a private market in some geographies next year as we mentioned so it's really more of a hybrid market next year.
But overall, we feel very good.
About overall demand and how we're tracking to be able to spread that.
Yes.
Okay, sorry, Ryan and myself had a little bit of a problem to understand you because online connection was not that good but.
As you pointed out correctly.
We deliver according to the plan for 2022.
For the EU.
We're not expecting any shift here.
We had as you know contractual agreement signed for the 23 with the EUR 450 million doses and an optional 450 million doses.
But as Ryan correctly said I think maybe for the EU that might be at a later point in time, but overall I think we got to move away from this thinking on the order book because what we have seen is there certain shifts it all depends on market demand.
Involvement of variance that are coming up and specifically ask Brian correctly said, there will be markets that moving to a private.
Setting going forward assuming that this is seen as an endemic market going forward and then it will take.
Probably a few years and then I think the danger really is to draw the wrong conclusions from some some number on an order book.
And therefore, we are moving away from.
Giving some guidance on this.
Got it thanks.
Thank you.
We will now go to our next question.
And the next question comes from Ron <unk> from Cowen. Please go ahead. Your line is open.
Hi, This is Brandon on for you Ron Thanks, very much for taking the question congrats on another strong quarter.
Just a quick one from us when we think about maybe the emergence of future variance and looked at kind of a timeline from the first time, a con way in December and then VA four five maybe around April or so.
And then the rollout.
September of <unk>, four or five booster you think this is more about the reasonable timeline, we can expect for future variance in terms of your interactions with FDA and materials within data you would need to get them.
Really to get future boosters authorized or are there are important considerations, we should really be keeping in mind as the landscape inevitably shifts over the coming months and years.
Yeah.
Where do you want to take that.
Yes, I can.
Can take that.
Think the future vaccine adaptation and booster process will depend on two aspects one the regulatory landscape.
And the second one is how fast we can respond to you of Valeant.
Starting with the second part is.
No.
Past Valeant unmatched unmatched OLED recently and the FDA after the FDA decision.
Paper to come up with an adaptive X gene enabled digital EBIT about two months, but that means our processes internal processes for vaccine adaptations.
Now, even even faster than what we had indicated beginning 2022 MTR going to further optimize the vaccine adaptation process to be able to respond quickly to new value.
And the second thing and what is important is and do you have now the case.
And with the EMA.
<unk> got we got the authorization of the vaccine based on pre existing clinical data on multiple variance and just to remind everyone. We have done multiple clinical trials with different variants and a safety profile that we have identified was all of it.
Consistent or very adaptive X gene.
And the second aspect is that we found that the preclinical data.
Cynical data and breakthrough.
Great.
Subjects with great through infections are very predictive on what they are seeing the clinical setting and authorization now of this variant adapted b a.
Four prospects and follow.
This logic.
<unk>.
EBIT and EBIT.
Authorization and availability of NBA for five adapter to X gene.
And we believe that this will become also in future.
Vacuum model that means one new variance of match.
A cry a boosting yeah.
We will be able to respond quickly and there will be a regulatory process to allow that such value. It up with X gene can get can be can be delivered.
There's been a few months after the emergence of the valleys.
Okay, great. Thanks very much.
Thank you.
That's our next question.
And the question comes from Ali <unk> from UBS. Please go ahead. Your line is open.
Hey, guys. Thanks, so much for taking my question, just a financial one Kevin you've booked at gross profits.
From the Pfizer collaboration can you comment I guess on your latest thoughts on how youre thinking about the profit margin.
Pfizer collaboration covered business longer term and how you see that changing.
And also how this could change if there were to be a combination COVID-19 flu vaccine for instance, thanks.
Yes, thanks for the question.
Not an easy not only and not an easy question to answer I have to say.
Well in terms of the gross margin I think you have seen pretty stable gross margin development for the year I mean in the quarters, you have some up and some ups and downs once in a while given that we had some write offs and we have elaborated on this thing.
And the documentation that we have published going forward I mean with a higher pricing of course it depends on what the cost out what the cost will be that we have to deduct.
It's a bit too early to really give you.
Can you give guidance on this what that means for our gross margin for 'twenty three in the years beyond any specifically then when <unk> comes in which we will take a while.
We will we won't see that at a later point in time, so there will be some some mixture.
That we will that we will see.
Going forward.
And therefore, you've got to bear with us a little bit until we are able to really give you some more clarity.
On the impact.
Got it.
Thank you.
Well now go to the next question and your next question comes from the line of Simon Baker from Redburn. Please go ahead. Your line is open.
Yes.
A question on pricing if I may.
Very helpfully gave us see the list price range for the U S of around 110 to 130.
Co single dose.
I appreciate it is not the same thing, but I just wanted to ask.
We should think about contrasting number with the $64 per dose.
<unk> talked about in April obviously yours covers a follow up broader remit.
CMS was talking about but just how we should think about.
However, these numbers.
Triangulate to Catherine.
And on a similar point could you give us any.
Early indications for pricing outside the U S for 2023, Thank you very much.
Yes. Thank you Simon I mean, as you know we're expecting this market to be a heavily tiered priced market.
Like for any other legacy.
And so the price that we've quoted there is a U S.
Our U S list price.
We would expect of course that sometimes there can be differences, depending on the segment that youre in.
That's pretty much all we can tell you at this point.
In terms of the dynamic.
We do think that.
This market will have some important differences to some of the other vaccine marketplace.
<unk>.
We expect that this will not be this will be a branded market for the foreseeable future.
And there is also a very different market structure here, but you have with some of the other vaccine markets, where you have many many players because I think we are we do believe we're in a.
Good position here by virtue of having a very strong product with a very strong product profile, both on safety and efficacy and have continued.
To build up our safety database and have a strong brand so.
I think we feel we feel good about our about the price that we put out there.
But that's pretty much what we can say at this point some geographies there could be differences and we're likely to still be a linked to volumes on some level as you would expect in a heavily contracted market like this where you have purchases in bulk.
And maybe to add to what Bryan just said I mean freight with Pfizer said two until the topic.
That pricing has been said given.
In relation to what sort of benefit.
We see that we bring with the product.
Of course, as Ryan said.
It's also a question of volume so I mean, we have signed <unk> contracts with various governments.
Contract side with other parties in the U S market to use that example of course totally different one and that will that will have an implication.
Overall I mean.
How the pricing will develop over time is to be expected to go up of course, because more and more countries. If it becomes endemic of Corp.
The base assumption for this.
Well, then have similar sort of develop developments and what the pricing that means in Japan or in Europe .
The European contract runs out that has to be seen as a bit early to really be well.
To me to be able to give you a more precise indications here, but thats the sort of <unk>.
All direction that we see.
Okay. Thank you very much.
Thank you.
We'll take one more question and the question comes from the line of Qiong tongue shoe from Diamondback. Please go ahead. Your line is open.
Great. Thanks for taking my question.
Ask broadly the mrna cancer vaccine.
So obviously there is some skepticism around the cancer vaccine.
Space, So maybe ruger can you.
Okay ill discuss a bit of your confidence.
This modality in the cancer vaccine space and maybe some updated thoughts on where we are at this modality will play at the most significant secondary.
Significant role.
And quick follow up to <unk> hundred one the car T.
Can you also discuss the.
So the registration path for this program given you have seen quite.
Encouraging data from.
From early trials.
Very much.
Yes.
Yeah. Thank you Shannon.
So let's.
Ill start with the cancer vaccine question and ask them to take the question.
<unk> clothing <unk> Scott.
So of course of course.
The discussion of our cancer vaccine is the same baidu believes that cancer vaccines.
And in the background of so many saved us in the past.
So my answer is always the same we believe that cancer vaccines must be positioned in.
No way.
And that they can do the job and they believe that and that the best market in the <unk>.
Best indication yes.
In clinical setting for breast cancer vaccine plus certainly yes.
The Q.
Two months.
In a micro metastatic.
So this is many.
Minimal residual disease or CTD in E positive patients after surgery.
And we know that in this in this setting.
A huge medical need to get your just ex cypress in colorectal cancer about 30% of patients after surgery.
Surgery have a relapse in the time of two to three years after surgery.
Triple negative breast cancer. This is also in the range of 30% to 40% in the first.
Four years after surgery and pancreatic cancer is even about 70% of patients.
<unk> after surgery and the same is similar data.
Scott for <unk>.
Cancer, Gi cancers, and so on that debt.
We want to position our Hudson has cancer vaccines, yes allow.
Allowing us to induce new antigen specific immune responses.
We know now from from clinical data or the clinical data in pancreatic cancer in melanoma patients and also from publications of either academic groups and that this could be an ideal setting to induce T cell responses that could could have to control an element.
Because if you were to monetize.
And <unk> would you like to take the second question, Yes, that's possible.
Car Ts have program BMT 211 children and.
The regulatory path, which we would see there.
Let me remind you that in.
In this program.
Actually in the Dulles.
Finding part of phase.
Phase one two trial, which means that we.
We have only test, but the first two dose levels of three dose levels of <unk>.
Card.
T cells and also still in the process of exploring whether adding to this new car T cells.
Product.
Vaccine.
It makes a difference or not and how the treatment regimen should be having.
Having said that we are also very excited you about the data, which we already see at this early stage, namely manage manage of our safety.
Uh huh.
Exciting clinical activity in particular in the patients with testicular cancer.
Therefore, we are also have also started about thinking about.
The best.
Our regulatory path here, we have not made any business Samsung cannot speak about that at this time point, but for sure next year.
Okay.
Thank you very much.
Thank you I will now hand, the call back for closing remarks.
Thank you for joining today's call, we look forward to talking to you soon.
Thank you.
Thank you. This concludes today's conference call. Thank you for participating you may now disconnect.
The conference will begin shortly to raise your hand during Q&A you can dial star one one.
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