Q3 2023 Moderna Inc Earnings Call

November 2, 2023

Operator: Good morning. My name is Kevin. And welcome to Moderna's Third Quarter 2023 Earnings Call. At this time, all participants are in a listen-only mode. Following the formal remarks, we'll open the call up for your questions. To ask a question during the session, you need to press Star One One on your telephone. You'll then hear an automated message advising your hand is raised. To withdrawl your question, please press Star One One again. Please be advised, today's call is being recorded. At this time, I'd like to turn the call over to Lavina Talukdar, Head of Investor Relations at Moderna. Please proceed.

Starwood one again, please be advised today's call is being recorded at this time I'd like to turn the call over to Olivia to lift our head of Investor Relations at <unk>. Please proceed.

Lavina Talukdar: Thank you, Kevin. Good morning, everyone, and thank you for joining us on today's call to discuss Moderna's third quarter 2023 financial results and business updates. You can access the press release issued this morning as well as the slides that we'll be reviewing by going to the Investors section of our website. On today's call are Stéphane Bancel, our Chief Executive Officer; Stephen Hoge, our President; Arpa Garay, our Chief Commercial Officer; and Jamey Mock, our Chief Financial Officer. Before we begin, please note that this conference call will include forward-looking statements made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Please see Slide 2 of the accompanying presentation and our SEC filings for important risk factors that could cause our actual performance and results to differ materially from those expressed or implied in these forward-looking statements.

Third quarter 2023 financial results and business update.

Can access the press release issued this morning as well as the slides that we'll be reviewing by going to the investors section of our website.

Today's call are Stefan <unk>, our Chief Executive Officer, Stephen Hoge, our President ARPA Gray, our chief commercial officer, and Jamey mock our Chief Financial Officer.

Before we begin please note that this conference call will include forward looking statements made pursuant to the Safe Harbor provisions of the private Securities Litigation Reform Act of $19 95.

Lavina Talukdar: Before we begin, please note that this conference call will include forward-looking statements made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Please see Slide 2 of the accompanying presentation and our SEC filings for important risk factors that could cause our actual performance and results to differ materially from those expressed or implied in these forward-looking statements. With that, I will turn it over to Stéphane.

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

That I will turn it over to Stephane. Thank you and good morning, good afternoon, everyone.

That I will turn it over to Stephane.

Stephane Bancel: Thank you, Lavina. Good morning or good afternoon, everyone. Thank you for joining us today. I will start with a quick review of our business for third quarter. Arpa will then give you an update of our commercial progress and plans. Jamey will present our financial results and will explain in detail the one-time charges we announced this morning in our press release. Stephen will then review our clinical programs. And I will share our key priorities for 2024 and 2025 to return Moderna to sales growth and profitability. We delivered US$1.8 billion in Spikevax sales of COVID vaccine in the third quarter. Based on trend we are seeing in the U.S COVID market in recent weeks, we expect our sales for 2023 to be at least US$6 billion.

Thank you guys.

I will start with a quick review of our business.

We've been to give you an update on our progress.

Our progress and plans.

Jimmy we present, our financial results and we will explain in detail the onetime charges, we announced this morning in a press release.

Stephen will then review our clinical programs.

And I will share our key priorities for 2024.

Stephane Bancel: And I will share our key priorities for 2024 and 2025 to return Moderna to sales growth and profitability. We delivered US$1.8 billion in Spikevax sales of COVID vaccine in the third quarter. Based on trend we are seeing in the U.S COVID market in recent weeks, we expect our sales for 2023 to be at least US$6 billion.

And 2025.

Tim will go now to the sales growth.

February.

We delivered on that once it begins around five bucks.

Steve in the first quarter.

Based on frankly, we are seeing in the U S market in recent weeks, we expect oil sands portfolio.

Great to be at least 6 billion.

Stephane Bancel: We have been preparing for the 2023 fall COVID launch throughout the year, because the U.S market was pivoting from a pandemic government purchase market to a commercial market. I am very pleased to report that according to IQVIA market data, we have a market share in the U.S of 45% season to date, compared to 36% for 2022. [inaudible] will show you, we even achieved 51% market share last week in the U.S. This commercial performance in the U.S market shows that Moderna can compete commercially with large established players, that will prove important as we launch RSV 2024 and combo of flu-COVID in 2025. On the cost side of the company, we informed you at R&D Day that it was important for us to resize our manufacturing footprint, as the world has moved from a pandemic to an endemic setting.

Market.

I am very pleased to report back on.

Turning to our PVA market data, we have a market share in the U S of 45%.

Season to date.

36% post 2022.

I will show you, we even achieved a 51% market share last week in the U S.

Stephane Bancel: This commercial performance in the U.S market shows that Moderna can compete commercially with large established players, that will prove important as we launch RSV 2024 and combo of flu-COVID in 2025. On the cost side of the company, we informed you at R&D Day that it was important for us to resize our manufacturing footprint, as the world has moved from a pandemic to an endemic setting.

These commercial performance in the U S market showed that although that can compete commercially we've lost established players.

As before we bought them is we don't see 2024 and combo of true co VP Duane fire.

On the cost side of our company. We informed you at R&D day that it was important for us to revise our manufacturing footprint as the world has moved from a pandemic endemic setting.

Stephane Bancel: I am pleased that our manufacturing and finance team were able to move fast and resize our manufacturing, so that we can go back to 75% to 80% gross margin levels. This resizing resulted in a charge of US$1.6 billion, which Jamey will explain in detail in his section. Now let me turn over to Arpa to walk you through our progress in the U.S market.

This rebranding with us taking a charge of $1 6 billion.

Which Jamie will explain <unk> picture.

Now, let me turn to Russell.

So I'll walk you through our progress in the U S market.

Arpa Garay: Thank you, Stéphane, and good morning or good afternoon to everyone. Today, I will provide an update on our third quarter performance, our U.S commercial launch progress and our preparation for our RSV launch next year. Our total sales in the third quarter came in at US$1.8 billion, which includes approximately US$800 million in international sales and US$900 million in U.S sales. Total sales for the first three quarters of the year were US$3.9 billion. Turning now to our expectations for the fourth quarter and full year 2023 outlook. In our international business, we expect an additional US$1.1 billion in sales. These sales are based on government contracts and once vaccine doses are shipped and accepted by the customer, they are not returnable.

Our total sales in the third quarter came in at $1 8 billion.

Which includes approximately $800 million in international sales and $900 million in U S South.

Total sales for the first three quarters of the year were $3 9 billion.

Turning now to our expectations for the fourth quarter and full year 2023 outlook.

In our international business, we expect an additional $1 $1 billion in sales.

These sales are based on government contracts and once vaccine doses are shipped and accepted by the customer they're not returnable.

Arpa Garay: More than half of these sales have already shipped in the fourth quarter. In the U.S, we expect at least US$1 billion in sales in the fourth quarter, which would bring U.S sales to approximately US$2 billion for the second half of 2023. This assumes approximately 50 million doses administered in the U.S, which would be similar to the fall season of 2022. With US$3.9 billion in sales recorded as of the end of the third quarter, expected fourth quarter sales of US$1.1 billion internationally and at least US$1 billion in the U.S, our updated sales outlook for 2023 is at least US$6 billion. Now turning to the U.S launch. The data shown here are from IQVIA. As a reminder, IQVIA data only captures the retail channel in the U.S, which includes retail pharmacies and long-term care.

In the U S. We expect at least $1 billion in sales in the fourth quarter, which would bring us sales to approximately $2 billion for the second half of 2023.

This assumes approximately 50 million doses administered in the U S, which would be similar to the fall season of 2020 tail.

With a $3 $9 billion in sales recorded as of the end of the third quarter expected fourth quarter sales of $1 1 billion internationally and at least $1 billion in the U S. Our updated sales outlook for 2023 is at least $6 million.

Arpa Garay: With US$3.9 billion in sales recorded as of the end of the third quarter, expected fourth quarter sales of US$1.1 billion internationally and at least US$1 billion in the U.S, our updated sales outlook for 2023 is at least US$6 billion. Now turning to the U.S launch. The data shown here are from IQVIA. As a reminder, IQVIA data only captures the retail channel in the U.S, which includes retail pharmacies and long-term care.

Now turning to the U S launch.

The data shown here are from UBS.

As a reminder, <unk> data only captures the retail channel in the U S, which includes retail pharmacies and long term care.

Arpa Garay: I'm first going to share what our weekly market share trends look like and then discuss our cumulative share since launch and how it compares to last year. On the fifth week post launch, for the week ending October 20th, what you can see on the slide here is that Moderna's market share is 51%. As we look over the season to date, Moderna's cumulative market share for this season is now 45%, which is higher than the 36% market share we had in 2022. As Stéphane mentioned, this progress demonstrates our ability to compete effectively in the commercial endemic market. Turning now to Slide 8, which shows cumulative vaccinations in the U.S retail pharmacy channel. This year, COVID vaccines were launched two weeks later than in 2022. As a result, we analyzed the data on a launch-adjusted basis, as shown in the graph on the slide.

On the fifth week post launch for the week ending October 20th what you can see on the slide here is that <unk> market share is 51%.

As we look over the season to date Mcdonald's cumulative market share for this season is now 45%, which is higher than the 36% market share we had in 2022.

As Stefan mentioned this progress demonstrates our ability to compete effectively in the commercial endemic market.

Arpa Garay: As Stéphane mentioned, this progress demonstrates our ability to compete effectively in the commercial endemic market. Turning now to Slide 8, which shows cumulative vaccinations in the U.S retail pharmacy channel. This year, COVID vaccines were launched two weeks later than in 2022. As a result, we analyzed the data on a launch-adjusted basis, as shown in the graph on the slide.

Turning now to slide eight which shows the cumulative vaccinations in the U S retail pharmacy channel.

This year Covid vaccines for launch two weeks later than in 2022.

As a result, we analyze the data on a launch adjusted basis as shown in the graph on the slide.

Arpa Garay: To do this, we look at the data based on the number of weeks post launch, rather than simply on a calendar basis. This helps us compare vaccines uptake in 2023 versus 2022. On the graph, the blue line represents cumulative vaccinations post launch in '22 and the red line represents cumulative vaccination post launch this year. And on a launch-adjusted basis, the total market is tracking ahead of last year's vaccination levels, both on a weekly basis but also on a cumulative basis. As a reminder, the retail channel is typically the largest segment, so these trends in the first five weeks are encouraging, given the later launch and slightly shorter season in 2023. Let's now turn to look at the channel mix in the market on Slide 9. In 2023, we expect retail and non-retail mix to evolve as the season progresses.

This helps us compare vaccines uptake in 2023 versus 2022.

On the graph the Blue line represents cumulative vaccinations post launch in 'twenty two.

And the Red line represents cumulative vaccination of post launch this year.

And on a launch adjusted basis. The total market is tracking ahead of last year's vaccination levels.

Both on a weekly basis, but also on a cumulative basis.

Arpa Garay: As a reminder, the retail channel is typically the largest segment, so these trends in the first five weeks are encouraging, given the later launch and slightly shorter season in 2023. Let's now turn to look at the channel mix in the market on Slide 9. In 2023, we expect retail and non-retail mix to evolve as the season progresses.

As a reminder, the retail channel is typically the largest segment. So these trends in the first five weeks are encouraging given the later launch and slightly shorter season in 2023.

Let's now turn to look at the channel mix in the market on slide nine.

In 2023, we expect retail and non retail mix to evolve as the season progresses.

Arpa Garay: The non-retail segment includes independent networks, health systems, U.S government entities, clinics, and other providers. Last year, this non-retail segment made up approximately 16 million doses in the season, or 33% of the total market. The gray line on the graph charts CDC-reported vaccinations, which capture both retail and non-retail channels in 2022. The blue line is vaccinations at retail pharmacies, as reported by IQVIA, in 2022. The difference between these two lines represents the non-retail segment. Looking at the data on the graph, you can see that the retail channel captures the majority of vaccinations early in the season. This can be seen in the narrow spread between the CDC and IQVIA data represented by the gray and blue lines, respectively.

Last year. This non retail segment made up approximately 16 million doses in the season or 33% of the total market.

The grey line on the graph chart, CVC reported vaccinations, which capture both retail and non retail channels in 2022.

Arpa Garay: The blue line is vaccinations at retail pharmacies, as reported by IQVIA, in 2022. The difference between these two lines represents the non-retail segment. Looking at the data on the graph, you can see that the retail channel captures the majority of vaccinations early in the season. This can be seen in the narrow spread between the CDC and IQVIA data represented by the gray and blue lines, respectively.

The Blue line is vaccinations at retail pharmacies as reported by <unk> in 2022.

The difference between these two lines represents the non retail segment.

Looking at the data on the graph you can see that the retail channel captured the majority of vaccinations early and the fever.

This can be seen in the narrow spread between the CDC and IQ via data represented by the Gray and Blue lines respectively.

Arpa Garay: Now, if you look in the seventh week of launch in 2022, the current week that we are in, in '23, you can see that the slope of the non-retail channel is increasing. We know that distributors this year have recently increased shipments to the non-retail channel and, as such, we expect non-retail as a percentage of market to grow between now and year-end. Importantly, we expect our market share to be consistent across channels and higher in 2023 than in 2022. We are committed to focus on public health efforts to increase vaccination rates. In the United States, we are taking a multi-pronged approach to educate all stakeholders and increase the urgency to get vaccinated. Across the medical community, pharmacies and clinics, and advocacy groups, we are providing patient education resources to help our partners encourage their patients to get their COVID vaccine this fall.

We know that distributors. This year have recently increased shipments to the non retail channel and as such we expect non retail as a percentage of market to grow between now and year end.

Importantly, we expect our market share to be consistent across channels and higher in 2023, then in 2022.

We are committed to focus on public health efforts to increase vaccination rates.

Arpa Garay: We are committed to focus on public health efforts to increase vaccination rates. In the United States, we are taking a multi-pronged approach to educate all stakeholders and increase the urgency to get vaccinated. Across the medical community, pharmacies and clinics, and advocacy groups, we are providing patient education resources to help our partners encourage their patients to get their COVID vaccine this fall.

In the United States, we are taking a multi pronged approach to educate all stakeholders and increase the urgency to get back to Nathan.

Across the medical community pharmacies, and clinics and advocacy groups, we are providing patient education resources to help our partners encourage their patients to get their COVID-19 vaccine in the fall.

Arpa Garay: Earlier this week, we also launched our branded direct-to-consumer campaign, both on TV, as well as across digital channels. For the remainder of the year, we will be amplifying education on the need for vaccination prior to gatherings, particularly with at-risk populations, such as families, and traveling during the holiday season. We are also launching a focused education effort for consumers who are infected with COVID this summer on the importance of getting vaccinated in November and December. To summarize our COVID outlook, we expect at least US$6 billion of sales this year based on the U.S vaccination trends that signal a market of at least 50 million doses. Moderna's share, both in retail and non-retail, is expected to be consistent across channels and higher than in 2022.

For the remainder of the year, we will be amplifying education on the need for vaccination prior to gatherings, particularly with at risk populations such as families and.

And traveling during the holiday season.

We are also launching a focused education effort for consumers who are infected with Covid. This summer on the importance of getting vaccinated in November and December.

Arpa Garay: To summarize our COVID outlook, we expect at least US$6 billion of sales this year based on the U.S vaccination trends that signal a market of at least 50 million doses. Moderna's share, both in retail and non-retail, is expected to be consistent across channels and higher than in 2022.

To summarize our Covid outlook, we expect at least $6 billion of sales. This year based on the U S vaccination trends at signal a market of at least $50 million of those.

<unk> share both in retail and non retail is expected to be consistent across channels.

And higher than in 2022.

Arpa Garay: Vaccine administrations in the retail channel are tracking ahead of last year on a launch-adjusted basis, signaling strong early consumer demand. Last year, only about 55% of COVID vaccinations were given by the end of October, with an additional 23 million vaccinations given in November and December. We expect the non-retail channel to increase as a percentage of the market, which will provide additional sites of vaccination for consumers to allow for a strong November and December. This year, given the later launch of vaccines, the non-retail channels are just now beginning their vaccination campaigns. To continue the momentum from our launch and supplement our customers' efforts, we will be amplifying our marketing campaigns in November and December.

Last year, only about 55% of Covid vaccinations were given by the end of October with an additional $23 million of explanations given in November and December.

We expect the non retail channel to increase as a percentage of the market, which will provide additional sites to vaccination for consumers to allow for a strong November and December.

This year given the later launch of vaccines and non retail channels are just now beginning their vaccination campaigns.

To continue the momentum from our launch and supplement our customers' efforts, we will be amplifying our marketing campaigns in November and December.

Arpa Garay: Let me now turn to the upcoming RSV launch in 2024. We believe we have a best-in-class product profile that can make a difference both to patients but also to our customers. Our clinical profile shows strong vaccine efficacy. We have a well-established safety and tolerability profile that leverages the same mRNA technology that has been delivered in over 1 billion COVID vaccines. Additionally, we have not seen any cases of GBS in our phase III trials. An important differentiator for our customers is that we will be the only company with ready-to-use, pre-filled syringes, which are preferred by pharmacists and by clinicians. We continue to expect a 2024 launch of our RSV vaccine in the U.S, and are also preparing for launches in several international markets.

We believe we have a best in class product profile that can make a difference both to patients but also to our customers.

Our clinical profile show strong vaccine efficacy.

We have a well established safety and Tolerability profile that Leverages. The same mrna technology that has been delivered over 1 billion covered vaccines.

Additionally, we have not seen any cases of GBS and our phase III trials.

Arpa Garay: Additionally, we have not seen any cases of GBS in our phase III trials. An important differentiator for our customers is that we will be the only company with ready-to-use, pre-filled syringes, which are preferred by pharmacists and by clinicians. We continue to expect a 2024 launch of our RSV vaccine in the U.S, and are also preparing for launches in several international markets.

An important differentiator for our customers is that we will be the only company with ready to use pre filled syringes, which are preferred by pharmacists and by clinicians.

Yeah.

We continue to expect a 2024 launch of our RSV vaccine in the U S. And are also preparing for launches in several international markets.

Arpa Garay: We're encouraged by the recent RSV launches in the market this year, beating expectations due to robust consumer awareness and demand. And we believe that we are well positioned for our launch in 2024. Our strong clinical profile and ready-to-use pre-filled syringes are key competitive differentiators. My team and I are particularly excited about our ready-to-use pre-filled syringes given the robust demand for our COVID pre-filled syringes this fall. The majority of RSV vaccines in the U.S will be given in the pharmacy setting. And given the ongoing pharmacy labor shortages, our ready-to-use presentation will save time and also reduce administration errors. We will be the only company with a one-step administration compared to competitive products, which require multiple preparation steps by pharmacists and clinicians.

And we believe that we are well positioned for a launch in 2024.

Our strong clinical profile and ready to use pre filled syringes are key competitive differentiators.

My team and I are particularly excited about our ready to use pre filled syringe of given the robust demand for our COVID-19 pre filled syringe as a fall.

Arpa Garay: The majority of RSV vaccines in the U.S will be given in the pharmacy setting. And given the ongoing pharmacy labor shortages, our ready-to-use presentation will save time and also reduce administration errors. We will be the only company with a one-step administration compared to competitive products, which require multiple preparation steps by pharmacists and clinicians.

The majority of RSV vaccines in the U S will be given in the pharmacy setting.

And given the ongoing pharmacy labor shortages are ready to use presentation will save time and also reduce administration errors.

We will be the only company with a one step administration compared to competitive products, which require multiple preparation steps by pharmacists and clinicians.

Arpa Garay: We are very excited for the launch of our RSV vaccine given the strong product profile. And the commercial team is well positioned to bring our RSV vaccine, our second respiratory vaccine, to market. I will now turn it over to Jamey to provide an update on our financials.

And the commercial team is well positioned to bring our RSV vaccine, our second respiratory vaccine to market.

I will now turn it over to Jamie to provide an update on our financials.

James Mock: Thanks, Arpa, and hello, everyone. Today, I will review our financial performance for the third quarter and provide an updated framework for our full year 2023 financial outlook. Additionally, given we know it's top of mind for investors, we wanted to provide our early thoughts on 2024 and how we're approaching the next couple years. Starting on Slide 15. Total net product sales for the quarter were US$1.8 billion, down 44% year-over-year, driven by lower sales volume, and partially offset by a higher average selling price. Product sales were almost evenly distributed between the U.S market and the rest of the world. We initiated product shipments to customers in mid-September for the fall booster season, following the authorization of our updated COVID-19 vaccine.

I will review our financial performance for the third quarter and provide an updated framework for our full year 2023 financial outlook.

Additionally, given we know it's top of mind for investors. We wanted to provide our early thoughts on 2024 and how we're approaching the next couple of years.

Starting on slide 15.

Total net product sales for the quarter were $1 8 billion.

James Mock: Total net product sales for the quarter were US$1.8 billion, down 44% year-over-year, driven by lower sales volume, and partially offset by a higher average selling price. Product sales were almost evenly distributed between the U.S market and the rest of the world. We initiated product shipments to customers in mid-September for the fall booster season, following the authorization of our updated COVID-19 vaccine.

Down 44% year over year, driven by lower sales volume and partially offset by a higher average selling price.

Product sales were almost evenly distributed between the U S market and the rest of the world.

We initiated product shipments to customers in mid September for the fall booster season, following the authorization of our updated COVID-19 vaccine.

James Mock: Cost of sales for the third quarter of 2023 was $2 2 billion compared to $1 1 billion in the prior year I will provide a detailed commentary on the following slides. Research and development expenses were $1 2 billion, which increased by 41% versus the prior year. Which restricts us to just our Covid vaccine and it does not include expected future launches. In combination with our updated and demick Covid forecast, we determined it was appropriate to record a valuation allowance for deferred tax assets. This valuation allowance did not impact cashflows, nor future returns northern company's ability to utilize deferred tax assets in future periods. Net loss for the period was $3.6 billion compared to net income with $1 billion last year.

James Mock: Cost of sales for the third quarter of 2023 was US$2.2 billion compared to US$1.1 billion in the prior year. I will provide detailed commentary on the following slides. Research and development expenses were US$1.2 billion, which increased by 41% versus the prior year. This increase was driven by our expanded and maturing development pipeline with six products now in Phase III studies or pending approval. Selling, general and administrative expenses were US$442 million, reflecting an increase of 59% year-over-year. The growth in spending was primarily driven by the buildout of our commercial activities and, in particular, our launch in the U.S commercial market. The income tax provision in Q3 was US$1.7 billion, as we reported evaluation allowance against deferred tax assets of US$1.7 billion.

Research and development expenses were $1 2 billion, which increased by 41% versus the prior year.

James Mock: Selling, general and administrative expenses were US$442 million, reflecting an increase of 59% year-over-year. The growth in spending was primarily driven by the buildout of our commercial activities and, in particular, our launch in the U.S commercial market. The income tax provision in Q3 was US$1.7 billion, as we reported evaluation allowance against deferred tax assets of US$1.7 billion.

James Mock: Which restricts us to just our Covid vaccine and it does not include expected future launches. In combination with our updated and demick Covid forecast, we determined it was appropriate to record a valuation allowance for deferred tax assets. This valuation allowance did not impact cashflows, nor future returns northern company's ability to utilize deferred tax assets in future periods. Net loss for the period was $3.6 billion compared to net income with $1 billion last year.

Which restricts us to just our Covid vaccine and it does not include expected future launches.

In combination with our updated and demick Covid forecast, we determined it was appropriate to record a valuation allowance for deferred tax assets.

This valuation allowance did not impact cashflows, nor future returns northern company's ability to utilize deferred tax assets in future periods.

Net loss for the period was $3.6 billion compared to net income with $1 billion last year.

James Mock: Under GAAP accounting rules, we are required to take a reserve, also referred to as evaluation allowance, for deferred tax assets when the current year and cumulative income projection for the next three years is in a loss position. These losses indicate our deferred tax assets may not be fully realized. It's important to note, future income from products not yet approved by regulators are excluded from these income projections, which restricts us to adjust our COVID vaccine, and it does not include expected future launches. In combination with our updated endemic COVID forecast, we determined it was appropriate to record a valuation allowance for our deferred tax assets. This valuation allowance did not impact cash flows, nor future returns, nor the company's ability to utilize deferred tax assets in future periods. Diluted lock for sure was US$9.53 compared to diluted earnings per share of $2.53 in 2022 at.

James Mock: In combination with our updated endemic COVID forecast, we determined it was appropriate to record a valuation allowance for our deferred tax assets. This valuation allowance did not impact cash flows, nor future returns, nor the company's ability to utilize deferred tax assets in future periods.

James Mock: Net loss for the period was US$3.6 billion compared to net income of US$1 billion last year. Diluted loss per share was US$9.53 compared to diluted earnings per share of US$2.53 in 2022. Finally, we ended the third quarter with US$12.8 billion in cash and investments. The decline versus prior quarter was driven by our operating loss and sales to be collected in Q4. Now, let me come back to cost of sales on Slide 16. We now expect full year cost of sales of US$5 billion, driven by US$1.5 billion of unit-driven expenses, which also includes royalties, and US$3.5 billion of inventory write-downs and charges related to CMO purchase commitments, cancellation fees, and wind-down costs. As Stéphane previously highlighted, in our pursuit to optimize the cost structure of our COVID-19 franchise, we undertook a strategic initiative in the third quarter to restructure our manufacturing footprint, which was built for the pandemic.

Finally, we ended the third quarter with $12.8 billion in cash and investments the decline versus private quarter was driven by our operating loss in sales to be collected in Q4.

Now, let me come back the cost of sales on slide 16.

We now expects full year cost of sales of $5 million.

Driven by $1.5 billion, a unit driven expenses, which also includes royalties and.

James Mock: We now expect full year cost of sales of US$5 billion, driven by US$1.5 billion of unit-driven expenses, which also includes royalties, and US$3.5 billion of inventory write-downs and charges related to CMO purchase commitments, cancellation fees, and wind-down costs. As Stéphane previously highlighted, in our pursuit to optimize the cost structure of our COVID-19 franchise, we undertook a strategic initiative in the third quarter to restructure our manufacturing footprint, which was built for the pandemic.

$3.5 billion of inventory write downs and charges related the CMO purchase commitments cancellation fees and wind down costs.

Estefan previously highlighted in our pursuit to optimize the cost structure. Our COVID-19 franchise, we undertook a strategic initiative in the third quarter to restructure our manufacturing footprint, which was built for the pandemic.

James Mock: As part of this initiative, we reduced our capacity and commitments with several third-party vendors, we reevaluated our raw material inventory levels, and cut back on our purchase commitments for raw materials not anticipated to be consumed before expiration. As a result, we are recording charges of US$1.6 billion, US$1.4 billion of which are in Q3 and an expected US$0.2 billion in Q4. The US$1.4 billion charge in Q3 consists of inventory write-downs of US$0.9 billion and CMO wind-down costs and cancellation fees of US$0.5 billion. The Q4 charge is related to CMO wind-down costs. Despite the immediate financial impact, we are confident that this strategic move will improve the efficiency of our manufacturing operations and establish a strong foundation for improved margins going forward.

As a result, we're reporting charges of $1.6 billion.

$1.4 billion of which are in three and an expected zero point $2 billion in queue for it.

The 1.4 billion dollar charge in Q3 consists of inventory write downs of zero point $9 billion in CMO wind down costs and cancellation fees are zero point $5 billion.

James Mock: The US$1.4 billion charge in Q3 consists of inventory write-downs of US$0.9 billion and CMO wind-down costs and cancellation fees of US$0.5 billion. The Q4 charge is related to CMO wind-down costs. Despite the immediate financial impact, we are confident that this strategic move will improve the efficiency of our manufacturing operations and establish a strong foundation for improved margins going forward.

The Q4 charges related to CMO wind depth costs.

Despite the immediate financial impact we are confident that this strategic move will improve the efficiency of our manufacturing operations and establish a strong foundation for improved margins going forward.

James Mock: As part of the US$1.6 billion in total restructuring charges I just mentioned, only the CMO-related costs and cancellation fees are cash restructuring costs. We project this approximately US$0.7 billion charge will have a payback in less than two years and a net cash benefit of approximately US$1 billion through 2029. As I mentioned, our full year forecast for cost of sales in 2023 is now US$5 billion. Before resizing charges of US$1.6 billion, our cost of sales for the full year is expected to be at the low end of our previous guidance of US$3.5 billion to US$4 billion. So, now coming back to my commentary on Q3. In addition to unit-driven manufacturing costs and the cost from this initiative, we also incurred approximately US$0.4 billion of inventory charges for excess and obsolete material, demand-related write-downs of our latest Spikevax product, and unutilized manufacturing capacity charges.

We projected approximately 0.7 billion dollar charge will have a payback in less than two years in a net cash benefit of approximately $1 billion through 2029.

As I mentioned are full year forecast for cost of sales in 2023 is now $5 billion before re sizing charges of $1.6 billion, our cost of sales for the full year is expected to be at the low end of our previous guidance of $3.5 billion to $4 billion.

So now coming back to my commentary of acute three in addition to unit driven manufacturing costs and the cost of this initiative. We also encouraged approximately zero point $4 billion of inventory charges for excess and obsolete material.

James Mock: So, now coming back to my commentary on Q3. In addition to unit-driven manufacturing costs and the cost from this initiative, we also incurred approximately US$0.4 billion of inventory charges for excess and obsolete material, demand-related write-downs of our latest Spikevax product, and unutilized manufacturing capacity charges.

Demand related write downs of our latest spike backs product and underutilized manufacturing capacity charges.

James Mock: Moving to Slide 17. In summary, we made substantial progress to resize our COVID cost structure and accelerated our path towards our longer-term target of 20% to 25% of sales. We expect our cost of sales to not only be at a lower level, but also be more predictable in the future. In recent quarters, our cost of sales were highly impacted by write-offs and charges as we just addressed today and in previous calls. Year-to-date write-offs and charges for inventory CMO and supplier-related commitments are 74% of sales. Starting in 2024, we expect those to be less than 10% of sales on an annualized basis. Our capacity is now better positioned to scale with volume. At a US$4 billion sales level, we expect cost of sales of approximately 35%, reducing to approximately 30% at US$6 billion of sales, and 20% to 25% at even higher sales levels.

In summary, we made substantial progress three sides are COVID-19 cost structure and accelerated our path towards our longer term target of 20% to 25% of sales.

We expect our cost of sales to not only be at a lower level, but also be more predictable in the future.

In recent quarters, our cost of sales were highly impacted by write offs and charges as we just address today and in previous calls.

Year to date write offs and charges for inventory CMO and supplier related commitments are 74% of sales star.

Starting in 2024, we expect them to be less than 10% of sales on an annualized basis.

James Mock: Starting in 2024, we expect those to be less than 10% of sales on an annualized basis. Our capacity is now better positioned to scale with volume. At a US$4 billion sales level, we expect cost of sales of approximately 35%, reducing to approximately 30% at US$6 billion of sales, and 20% to 25% at even higher sales levels.

Our capacity is now better position to scale with volume at a $4 billion sales I believe we expect cost of sales of approximately 35%.

Reducing to approximately 30% at $6 billion of sales and.

And 20 to 25 per cent at even higher sales levels and.

James Mock: In other words, with our resized manufacturing footprint, we now expect to achieve significant volume leverage moving forward. Let's now move to Slide 18. While we intend to continue to focus on GAAP results, we wanted to give you a view of our financial results in Q3 with and without the resizing and tax valuation allowance charges. While our total GAAP net loss in the third quarter was US$3.6 billion, our loss excluding these charges would have been US$0.5 billion. Now, let's turn to our updated 2023 financial framework on Slide 19. As Arpa mentioned earlier, we now expect product sales for 2023 of at least US$6 billion for the full year, which is comprised of US$3.9 billion of sales through the third quarter, an additional US$1.1 billion of international sales in Q4, and at least US$1 billion of Q4 sales from the U.S. As explained earlier, we now expect cost of sales for the full year of approximately US$5 billion, which includes resizing charges of US$1.6 billion.

Let's see I'll move decided 18.

While we intend to continue to focus on GAAP results. We wanted to give you a view of our financial results in Q3 with and without the recycling and tax valuation allowance charges.

While our total GAAP net loss in the third quarter was $3.6 billion or loss. Excluding these charges would have been zero point $5 billion.

Now, let's turn to update of 2023 financial framework on slide 19.

James Mock: As Arpa mentioned earlier, we now expect product sales for 2023 of at least US$6 billion for the full year, which is comprised of US$3.9 billion of sales through the third quarter, an additional US$1.1 billion of international sales in Q4, and at least US$1 billion of Q4 sales from the U.S. As explained earlier, we now expect cost of sales for the full year of approximately US$5 billion, which includes resizing charges of US$1.6 billion.

As I mentioned earlier, we now expect product sales for 2000 twenty-three of at least $6 billion for the full year.

Which is comprised of $3.9 billion of sales through the third quarter, an additional $1.1 billion of international sales in Q4, and at least $1 billion a cue for sales from the U S.

As explained earlier, we now expect cost of sales for the full year of approximately $5 billion, which.

Which includes re sizing charges of $1.6 billion.

James Mock: For R&D and SG&A, we now expect full year expenses to be approximately US$6.3 billion, with approximately US$4.8 billion in research and development. Our R&D spend is slightly higher than the US$4.5 billion previously forecasted, which is mainly driven by business development activities as well as additional investments in our late-stage clinical trials. Our forecast for SG&A expenses remain consistent at approximately US$1.5 billion. We now expect a full year tax expense of approximately US$0.8 billion to US$1 billion, driven by the US$1.7 billion increase in the deferred tax allowance I referenced earlier. And finally, we now expect capital expenditures of approximately US$0.9 billion, down from our previous guidance of US$1 billion. Before I get into the specifics on 2024 and 2025, I wanted to share with you our principles on how we are operating the company today and our plans over the next three years.

Our R&d's Ben is slightly higher than the $4.5 billion previously forecasted, which is mainly driven by business development activities as well as additional investments in our late stage clinical trials.

Our forecast for SG&A expenses remain consistent at approximately $1.5 billion.

James Mock: We now expect a full year tax expense of approximately US$0.8 billion to US$1 billion, driven by the US$1.7 billion increase in the deferred tax allowance I referenced earlier. And finally, we now expect capital expenditures of approximately US$0.9 billion, down from our previous guidance of US$1 billion. Before I get into the specifics on 2024 and 2025, I wanted to share with you our principles on how we are operating the company today and our plans over the next three years.

We now expect a full year tax expense of approximately 0.8 to $1 billion driven by the $1.7 billion increase in the deferred tax allowance I referenced earlier.

And finally, we now expect capital expenditures of approximately zero point $9 billion down from our previous guidance of of of $1 billion.

Before I get into the specifics on 2024 and 2025 I wanted to share with you our principles on how we were operating the company today.

And our plans over the next three years.

James Mock: We are laser-focused on making our COVID franchise profitable in 2024 and beyond. We look at our Spikevax product profitability, excluding research and development costs, for our future pipeline, and we believe our recent resizing efforts will ensure that our COVID franchise is a continuous and increasing source of income and cash generation. At the same time, we also recognize the significant and unique opportunity for organic sales growth ahead of us with our late-stage pipeline. We will be disciplined in our investment approach and adjust R&D and SG&A, based upon the sales performance of our product lines, which in 2024 is still mostly COVID, but we expect it to also include RSV. We expect this investment in our late-stage pipeline will result in a loss over the next two years, but help us to breakeven starting in 2026.

We look at our spike backs product profitability, excluding research and development costs for future pipeline and we believe our recent re sizing efforts will ensure that our COVID-19 franchise continuous and increasing source of income and cash generation.

At the same time, we also recognize the significant and unique opportunity for organic sales growth ahead of us with our late stage pipeline.

James Mock: We will be disciplined in our investment approach and adjust R&D and SG&A, based upon the sales performance of our product lines, which in 2024 is still mostly COVID, but we expect it to also include RSV. We expect this investment in our late-stage pipeline will result in a loss over the next two years, but help us to breakeven starting in 2026.

We will be disciplined in our investment approach and adjust R&D and SG&A based upon the sales performance of our product lines, which in 2024, it's still mostly COVID-19, but we expected to also include RSV.

We expect that investment in our late stage pipeline will result in the loss over the next few years.

But help us breakeven starting in 2026.

James Mock: We believe our current balance sheet is more than sufficient to fund our plans without the need to raise equity. We are also not planning to repurchase shares in the intermediate term. Stepping back, we believe this is an unparalleled opportunity to impact the lives of patients, while creating shareholder value at the same time. Moving to Slide 21, let's start with our view on sales over the next couple of years. We're expecting sales to hit a low point in 2024 at approximately US$4 billion. The biggest change year-over-year is related to our signed APAs. We currently have US$1 billion of COVID-related APAs for delivery in 2024. Recall that our first half sales in 2023 of US$2.1 billion were mostly deferrals from our 2022 existing contracts. So, we expect minimal sales in the first half of 2024.

Stepping back we believe this is an unparalleled opportunity to impact the lives of patients while creating shareholder value at the same time.

Moving assigned 21, let's start with the review on sales over the next couple of years.

James Mock: Moving to Slide 21, let's start with our view on sales over the next couple of years. We're expecting sales to hit a low point in 2024 at approximately US$4 billion. The biggest change year-over-year is related to our signed APAs. We currently have US$1 billion of COVID-related APAs for delivery in 2024. Recall that our first half sales in 2023 of US$2.1 billion were mostly deferrals from our 2022 existing contracts. So, we expect minimal sales in the first half of 2024.

We're expecting sales to hit a low point in 2024 at approximately $4 billion.

The biggest change you over here is related to our assigned Apa's. We currently have $1 billion of Covid related apa's for delivery in 2024.

Recall that our first half sales in 2023 of $2.1 billion, we're mostly deferrals from our 2022 existing contracts.

So we expect minimal sales in the first half of 2024.

James Mock: For the U.S, we expect 2024 to be at least US$2 billion and believe it will grow over time. Lastly, we expect approximately US$1 billion from RSV and other international COVID sales. And finally, in 2025, we expect a return to growth. Let me finish by giving you a more fulsome view on 2024 and our thinking on 2025. Starting with 2024, as I just explained, we expect sales to be approximately US$4 billion. Cost of sales are expected to be approximately 35% of sales. R&D expenses of approximately US$4.5 billion in 2024, would be down 6%. In 2024, the majority of our R&D expenses are for registration trials, which are now mostly committed. I will speak to our view on 2025 R&D expenses in a moment. SG&A expenses of approximately US$1.3 billion in 2024 would be down 13%.

Lastly, we expect approximately $1 billion from RSP and other international Covid sales.

And finally in 2025, we expect to return to growth.

That'd be finished by giving you a more fulsome view on 2024 and are thinking of 2025.

Starting with 2024 as I just explained we expect sales to be approximately $4 billion.

Cost of sales are expected to be approximately 35 per cent of sales.

James Mock: Cost of sales are expected to be approximately 35% of sales. R&D expenses of approximately US$4.5 billion in 2024, would be down 6%. In 2024, the majority of our R&D expenses are for registration trials, which are now mostly committed. I will speak to our view on 2025 R&D expenses in a moment. SG&A expenses of approximately US$1.3 billion in 2024 would be down 13%.

R&D expenses of approximately $4.5 billion in 2024 would be down 6% in.

In 2024, the majority of RMB expenses are for registration on child, which are now mostly committed.

I will speak to our view on 2025 or under your expenses in a moment.

Ah CNA expenses of approximately $1.3 billion in 2024 would be down 13%.

James Mock: We expect taxes to be negligible in 2024 and capital expenditures to be similar to 2023 at US$0.9 billion. In summary for 2024, Spikevax will generate nearly US$1 billion of income. When we combine that with our estimated investments in R&D and capital expenditures, our cash balance is projected to be approximately US$9 billion at the end of 2024. Now for our preliminary thoughts on 2025. As mentioned earlier, sales will return to growth. Cost of sales will improve with the increased sales growth. R&D will be flat to down, and we have much greater flexibility for reduction, given that only approximately half of our current R&D spending levels for registrational trials are committed for 2025. SG&A will be flat to down. Taxes will continue to be negligible.

In summary for 2024 spikes actual generate nearly $1 billion of income.

When we combine that with our estimated investments and R&D and capital expenditures are cash balance is projected to be approximately $9 million at the end of 2024.

Now for our preliminary thoughts on 2025.

James Mock: As mentioned earlier, sales will return to growth. Cost of sales will improve with the increased sales growth. R&D will be flat to down, and we have much greater flexibility for reduction, given that only approximately half of our current R&D spending levels for registrational trials are committed for 2025. SG&A will be flat to down. Taxes will continue to be negligible.

As mentioned earlier sales will return to growth.

Cost of sales will improve with the increase sales growth.

R&D will be flat to down and.

We have much greater flexibility for reduction given that only approximately half of our current R&D spending levels for Registrational trials are committed for 2025.

SG&A, we'll be glad to down taxes will continue to be negligible and capital expenditures will be materially lower after the completion of our facilities in the U K, Canada, and Australia, and the first half of 2025.

SG&A, we'll be glad to down taxes will continue to be negligible

James Mock: and capital expenditures will be materially lower after the completion of our facilities in the U K, Canada, and Australia, and the first half of 2025. In summary, our Covid operating income will grow. And our investments ruble nimble remained flat or lower leaves. Leaving us to an estimated ending cash balance of approximately $6 billion to $7 billion in 2025. Finally during this period, we expect to launch five new products to help us breakeven in 2026 so. So with that I'll now turn the call over to see them. Good morning, or good afternoon. Today I will do a quick review of our clinical programs. Many of the details from these programs were shared in our R&D day in September.

James Mock: And capital expenditures will be materially lower after the completion of our facilities in the U.K, Canada and Australia in the first half of 2025. In summary, our COVID operating income will grow and our investments will remain flat or lower, leading us to an estimated ending cash balance of approximately US$6 billion to US$7 billion in 2025. Finally, during this period, we expect to launch five new products to help us breakeven in 2026. So, with that, I'll now turn the call over to Stephen.

In summary, our Covid operating income will grow.

And our investments ruble nimble remained flat or lower leaves.

Leaving us to an estimated ending cash balance of approximately $6 billion to $7 billion in 2025.

Finally during this period, we expect to launch five new products to help us breakeven in 2026 so.

So with that I'll now turn the call over to see them.

Stephen Hoge: Good morning or good afternoon. Today I'll do a quick review of our clinical programs. Many of the details from these programs were shared at our R&D Day in September. I will also review the phase III trial designs for our combination flu and COVID vaccine, mRNA-1083 and the phase III trial design for our INT in non-small cell lung cancer. During R&D Day, we shared the significant progress we've made through the year in advancing our late-stage pipeline, creating the opportunity to have up to 15 product launches in the next five years. Through 2025, and subject to regulatory review and approvals, we anticipate launches for our RSV vaccine, our flu vaccine, a next-generation COVID vaccine, and our combination flu and COVID vaccine.

Good morning, or good afternoon.

Today I will do a quick review of our clinical programs. Many of the details from these programs were shared in our R&D day in September.

I will also review the phase III trial designs for accommodation flew in Covid vaccine mrna tendency three and the phase three trial designed for I N T and non small cell lung cancer.

[laughter] during R&D day, we shared the significant progress we've made through the year and advancing are late stage pipeline, creating the opportunity to have up to 15 product launches in the next five years.

Stephen Hoge: During R&D Day, we shared the significant progress we've made through the year in advancing our late-stage pipeline, creating the opportunity to have up to 15 product launches in the next five years. Through 2025, and subject to regulatory review and approvals, we anticipate launches for our RSV vaccine, our flu vaccine, a next-generation COVID vaccine, and our combination flu and COVID vaccine.

Through 2025 in subject to regulatory review and approvals, we anticipate launches four RSV vaccine or flu vaccine next generation Covid vaccine and our combination fluid in Covid vaccine.

Stephen Hoge: Looking beyond 2025, we have a diverse pipeline of other vaccines, cancer therapies, and rare metabolic disease medicines. We're very excited by the potential benefits these medicines offer across a diverse range of therapeutic areas. Slide 25 is an overview of our respiratory vaccines pipeline. Our leading pipeline includes commercial and phase III programs against COVID, RSV, and flu, as well as earlier-stage next-generation programs in COVID and flu and multiple [inaudible]. We recently shared positive topline phase I II data from our combination flu and COVID vaccine, mRNA-1083. And on the heels of this success, we've started and are rapidly enrolling a phase III study for mRNA-1083 in adults 50 and older. Slide 26 shows the phase III design for mRNA-1083.

Very excited by the potential benefits these medicines offer across a diverse range of therapeutic areas.

25 is an overview of our respiratory vaccines pipeline.

Are leading pipeline includes commercial and phase three programs against Covid RSV and food.

As well as earlier stage next generation programs in Covid and flu and multiple nominations.

Stephen Hoge: We recently shared positive topline phase I II data from our combination flu and COVID vaccine, mRNA-1083. And on the heels of this success, we've started and are rapidly enrolling a phase III study for mRNA-1083 in adults 50 and older. Slide 26 shows the phase III design for mRNA-1083.

We recently shared positive topline phase one two data from our accommodation food in Covid vaccine mrna 10 83.

On the heels of the success, we've started in a rapidly enrolling a phase three study for mrna 10 83 in adults 50 and older.

Slide 26 shows the phase III design for them or 1983.

Stephen Hoge: The phase III study is a randomized, stratified, observer-blind, active-control study evaluating the immunogenicity and safety of 1083 compared to co-administered flu and COVID vaccines. The study will enroll 8,000 participants overall, with two cohorts of 4,000 participants stratified by age 65 years and older and 50 to 64 years of age. Both cohorts will receive mRNA-1083, or in the control arm, an age-recommended licensed quadrivalent flu vaccine plus our approved COVID vaccine. Study participants will be followed for six months. The next, on Slide 27, is an overview of our latent and other vaccines pipeline. As previously announced, our phase III study evaluating vaccine efficacy and safety of our CMV vaccine in women of childbearing age is now fully enrolled, including the adolescent cohort.

The study will rule 8000 participants overall with two cohorts of 4000 participants stratified by age 65 years and older than 50 to 64 years of age.

Stephen Hoge: Both cohorts will receive mRNA-1083, or in the control arm, an age-recommended licensed quadrivalent flu vaccine plus our approved COVID vaccine. Study participants will be followed for six months. The next, on Slide 27, is an overview of our latent and other vaccines pipeline. As previously announced, our phase III study evaluating vaccine efficacy and safety of our CMV vaccine in women of childbearing age is now fully enrolled, including the adolescent cohort.

Both cohorts will receive mrna, Tennessee, three or in the control arm and age recommended license quadrivalent flu vaccine plus are approved COVID-19 vaccine.

Study participants will be followed for six months.

The next slide 27 is an overview of our Layton and other vaccines pipeline as previously announced our phase three study evaluating vaccine efficacy and safety of our C. M V vaccine in women of Childbearing age is not fully enrolled including the adolescent cohort.

Stephen Hoge: The study is accruing cases and we look forward to vaccine efficacy data when it becomes available. Earlier-stage clinical programs against EBV, HIV, VZV, HSV, and against the Norovirus and Lyme disease continue to progress. Slide 28 is an overview of our therapeutics pipeline. We're proud of the progress across cancer, rare diseases, and other areas. Many of the details of these programs were highlighted at our recent R&D Day, and I refer you to that presentation on our website. Notable since R&D Day is the continued rapid enrollment of the INT phase III adjuvant melanoma study, which has seen a great deal of interest from investigators and patients since presentation of the phase II data at ASCO earlier this year. As previously announced, before the end of the year, we will conduct another analysis of the phase II study with longer follow-up time at approximately three years, and we are looking forward to sharing that data. INT is also moving forward in other types of cancer with the initiation of a second phase III study in adjuvant non-small cell lung cancer.

Earlier stage clinical programs against EBV HIV V. D V H S b and against Norovirus and lime disease continue to progress.

July 28th is an overview of our therapeutics pipelines.

We're proud of the progress across cancer rare diseases and other areas <unk>.

Many of the deals with these programs were highlighted in our recent R&D died and I refer you to that presentation on our website.

Notable since R&D day is the continued rapidly rapid enrollment of the int phase III adjuvant melanoma study, which has seen a great deal of interest from investigators and patients since presentation of the phase two data <unk> earlier this year.

Stephen Hoge: As previously announced, before the end of the year, we will conduct another analysis of the phase II study with longer follow-up time at approximately three years, and we are looking forward to sharing that data. INT is also moving forward in other types of cancer with the initiation of a second phase III study in adjuvant non-small cell lung cancer.

As previously announced before the end of the year, we will conduct another analysis of the phase two study with longer follow up time and approximately three years.

We are looking forward to sharing that data.

Int is also moving forward and other types of cancer with the initiation of a second phase three study in adjuvant non small cell lung cancer.

Stephen Hoge: The phase III designed for adjuvant non small cell lung cancer is shown on slide 29th. It is a randomized placebo blind a double blind placebo, an active comparator controlled study of the combination of int, plus keytruda versus placebo, plus keytruda impatience with non small cell lung cancer. The study will enroll approximately 900 patients with stage two to three be tumors Hoover respected in previously treated with adjuvant chemotherapy. Each patient will receive up to nine doses of int administered intramuscularly every three weeks with Keytruda administered every six weeks in the active army or nine doses of a placebo injection administered every three weeks and Keytruda every six weeks in the comparator arm. The primary endpoint of this study is disease free survival key secondary I'm points include overall survival distant metastasis free survival and patient reported outcomes.

Stephen Hoge: The phase III design for adjuvant non-small cell lung cancer is shown on Slide 29. It is a randomized placebo-blind - double-blind placebo and active comparator controlled study of a combination of INT plus KEYTRUDA versus placebo plus KEYTRUDA in patients with non-small cell lung cancer. The study will enroll approximately 900 patients with stage II to III-B tumors who were resected and previously treated with adjuvant chemotherapy. Each patient will receive up to nine doses of INT administered intramuscularly every three weeks with KEYTRUDA administered every six weeks in the active arm, or nine doses of a placebo injection administered every three weeks and KEYTRUDA every six weeks in the comparator arm. The primary endpoint of the study is disease-free survival.

It is a randomized placebo blind a double blind placebo, an active comparator controlled study of the combination of int, plus keytruda versus placebo, plus keytruda impatience with non small cell lung cancer.

The study will enroll approximately 900 patients with stage two to three be tumors Hoover respected in previously treated with adjuvant chemotherapy.

Stephen Hoge: Each patient will receive up to nine doses of INT administered intramuscularly every three weeks with KEYTRUDA administered every six weeks in the active arm, or nine doses of a placebo injection administered every three weeks and KEYTRUDA every six weeks in the comparator arm. The primary endpoint of the study is disease-free survival.

Each patient will receive up to nine doses of int administered intramuscularly every three weeks with Keytruda administered every six weeks in the active army or nine doses of a placebo injection administered every three weeks and Keytruda every six weeks in the comparator arm.

The primary endpoint of this study is disease free survival key secondary I'm points include overall survival distant metastasis free survival and patient reported outcomes.

Stephen Hoge: key secondary I'm points include overall survival distant metastasis free survival and patient reported outcomes. This study marks an important milestone in our collaboration with our partner Mark and our shared commitment to rapidly bring int to patients. With that I'll turn it over to Stefan. Thank you Steven Jamie enough. Of course, he has to retail sales growth. For February.

Stephen Hoge: Key secondary endpoints include overall survival, distant metastasis-free survival, and patient-reported outcomes. This study marks an important milestone in our collaboration with our partner, Merck, and our shared commitment to rapidly bring INT to patients. With that, I'll turn it over to Stéphane.

This study marks an important milestone in our collaboration with our partner Mark and our shared commitment to rapidly bring int to patients.

With that I'll turn it over to Stefan.

Thank you Steven Jamie enough.

Stephane Bancel: Thank you, Stephen, Jamey and Arpa. Our focus is to return Moderna to sales growth and profitability. To achieve that, we have three priorities. Priority number one, commercial execution. Our market share in the U.S demonstrates we can compete. We are focused on launching RSV in 2024. We believe we have best-in-class profile for RSV vaccine, high-efficiency, good safety profile, and the easiest to use in pharmacies or doctor's offices. As you all know, pharmacy chains are having challenges given the workload, especially in the fall season. The two other vaccines on the market today are very complicated to prepare before injection; one is nine steps, and one is four steps. Now we launched pre-filled syringe and, as Arpa said, we are very excited about that.

Of course, he has to retail sales growth.

For February.

Keep that we have three priorities.

Number one commercially picture shot.

Market share in the U S demonstrates who can compete.

We're focused on actually causes eat twice wonderful we believe we're betting first provider for a new vaccine type because he food safety profile and the easiest we use the pharmacy the look of abuse.

Stephane Bancel: As you all know, pharmacy chains are having challenges given the workload, especially in the fall season. The two other vaccines on the market today are very complicated to prepare before injection; one is nine steps, and one is four steps. Now we launched pre-filled syringe and, as Arpa said, we are very excited about that.

You'll know pharmacy chance dogging challenges you been the walk through.

The four seasons.

As long as the vaccines on the market. So they are very complicated repair before injection.

When is the next steps in one of these photos.

When I relocated quickly so rage Satan got very excited about that.

Stephane Bancel: And from the discussions I had with the leadership of pharmacies, I believe that this will be an important differentiation. Our COVID plus flu combo vaccine should launch in 2025. And as you know, flu is a higher volume market than COVID. In the U.S, for example, flu is around 3 times the number of doses compared to the COVID market. With these new product launches in '24 and '25, and the combination of COVID sales in the endemic setting, we believe Moderna will be in sales growth again in 2025. Priority number two, discipline investments. We'll be disciplined in our investments and cycle them based on our sales performance. As you saw, we have taken bold actions to resize our manufacturing footprint in the third quarter. The team is not done and there are many continuous improvement projects to drive a reduction in cost of manufacturing.

Are we supposed to come home about eight blocks.

2025.

And as you know, we just hung up on the market and then Kobe.

In the U S focused on court foods around three times, the number of ability as competitive market.

The new product launches in 24 25.

They should of Kobe famous in the end of excepting we believe more than I would be in sales grew up again 2025.

Brought the number two.

Stephane Bancel: Priority number two, discipline investments. We'll be disciplined in our investments and cycle them based on our sales performance. As you saw, we have taken bold actions to resize our manufacturing footprint in the third quarter. The team is not done and there are many continuous improvement projects to drive a reduction in cost of manufacturing.

Billing investments.

Would be green investment and thanks for them based on the performance.

As you. So we're taking both auctions recycle manufacturing footprint in the phone call. So.

The Tv's not though and there are many continuous improvement projects would remember the cost of manufacturing.

Stephane Bancel: We'll also look at our R&D costs and will consider partnering some programs, if needed, to allow us to be responsible and disciplined about our costs. For SG&A, as Jamey mentioned, we are currently going through our 2024 budget and our goal is to have a lower spend in SG&A in 2024 than we had in 2023. We still plan to keep SG&A flat in 2025 versus 2024. We're launching respiratory products in 2024 and 2025, and we anticipate the same teams [inaudible] productivity gains as we improve our commercial operations. As Jamey mentioned, we expect to breakeven in 2026. Priority number three, executing on our late-stage pipeline to drive sales growth. As you all know, we have an exciting late-stage pipeline with six Phase 3 assets. For respiratory program, RSV, flu, next-gen COVID, mRNA-1283, and COVID plus flu combo that Stephen just talked about.

Allow us to be responsible and distributing the bulk of cost.

<unk> I assume you mentioned, we're currently going through all of 2024 budget and hopefully whoever it almost spinney is journey 2024, they don't have to wait very frequently.

Frequently.

We're so comfortable keep it flat.

Slash 2025 of us who swing rainfall.

Well I don't see much breath already productivity 24 and 2025.

And we used to keeping the same teams with Sandra.

With respect productivity gains as we improve our commercial operations.

Stephane Bancel: As Jamey mentioned, we expect to breakeven in 2026. Priority number three, executing on our late-stage pipeline to drive sales growth. As you all know, we have an exciting late-stage pipeline with six Phase 3 assets. For respiratory program, RSV, flu, next-gen COVID, mRNA-1283, and COVID plus flu combo that Stephen just talked about.

As Jamie mentioned, we expect to break even in 2026.

The number for Ya.

Being on a pitch black lines with gross coastal.

As you know we have an exciting.

Nine six phase III outfits.

Stephane Bancel: For the rest of your program or. V through next shift Kobe, among us, where we keep racing and Kobe, Christopher Columbus Memphis profile.

V through next shift Kobe, among us, where we keep racing and Kobe, Christopher Columbus Memphis profile.

Stephen Hoge: One latent program, CMV, which is fully enrolled in phase III and accruing cases. One oncology program, INT in melanoma, and as Stephen mentioned, in lung cancer. We look forward to having and sharing three years of INT data from our melanoma study before the end of this year. If the data are strong, we believe it could be the basis for regulatory discussions for potential accelerated approval. We have been investing in building a factory in Marlborough, Massachusetts, which will enable the commercial launch for INT. Thanks to the mRNA platform we built, we have an exciting pipeline, with up to 15 launches in the next five years. We have the largest late-stage pipeline of any mRNA company in the world and will continue to focus to deliver the greatest possible impact to people for mRNA medicine.

One of those you program and seen men on the mountain and soon as you go to mention it in Arkansas.

We look forward to having and sharing free data from them and I'm the master the before the end of this year.

You would think the austral, we believe it would be the babies for regulatory discussions.

I'm not sure that the poor.

Stephen Hoge: We have been investing in building a factory in Marlborough, Massachusetts, which will enable the commercial launch for INT. Thanks to the mRNA platform we built, we have an exciting pipeline, with up to 15 launches in the next five years. We have the largest late-stage pipeline of any mRNA company in the world and will continue to focus to deliver the greatest possible impact to people for mRNA medicine.

We have been investing in these eager factory in Marlboro mass I shall we say it enabled.

Enabled commercial launch variety.

Thanks to be among their platform we'd be.

Exciting pipeline, we were up to 50 feet in the next five years.

With an office, thanks, parkland, Albania Monica company in the World and will cost you to help us with any type of breakfast plus equal inbox with people right among the medicine.

Stephen Hoge: I've never been more excited about the potential we have to deliver for patients. The actions we are taking help us to execute on that vision. With this, operator, we'll be happy to take questions now.

The actions were breathtaking.

Execute on that vision visa.

Be surprised though we'd be happy to take questions now.

Operator: Thank you ladies and gentlemen. If you have a question or a comment at this time, please press Star One One on your telephone. If your question has been answered and you wish to remove yourself from the queue, please press Star One One again. We will pause for a moment while we compile our Q&A roster. Our first question comes from Gena Wang with Barclays. Your line is open.

Our first question comes from Junior Wang with Barclays. Your line is open.

Gena Wang: Thank you for taking my questions. I have two questions regarding the commercial questions. First, you did mention 2026, you’re looking to have a breakeven. And when we take a quick look based on your 2024 and 2025 outlook, it seems the total cost could be in the US$8 billion to US$9 billion, that range. Could you give us a sense what could be the additional sales if we’re using 2024 guidance as a base point? And the second very quickly regarding the manufacturing resizing. After resizing, what is the full capacity regarding doses and what percentage of the manufacturing will be internal in 2024 and 2025?

<unk> regarding a commercial questions first you know.

2026, I'm lucky to have it.

And when we take a quick look based on your 2024 25.

It seems the total cost to be.

That link could you give.

Give us a sense what could be an additional sales if we're using 2020th for guidance.

Point.

Secondary quickly recording manufacturing.

I'll have to re sizing what is it.

Doses and what percentage of the manufacturing.

Alright in 2020 2025.

James Mock: Maybe I’ll take the first one, first part of the question. So, in terms of 2026, Gena and thanks for the question, let’s talk to you about how we’re thinking about it. So, we mentioned US$4 billion in 2024, approximately US$4 billion. And this is all about our late-stage pipeline coming to fruition. So, in 2024, we’ll launch RSV, but it’s mostly kind of in the second half year sales, and then we’ll have a full year in 2025, so that’ll provide growth. We will also come to market with flu in 2025. We’ll also come to market with a combination of flu and COVID in 2025. Again, depends on timing, but by 2026, we should have a full portfolio. So, we’re not going to say what the exact sales numbers are, but you mentioned US$8 billion to US$9 billion in costs.

Part of the question. So in terms of 2000 2016, and thanks for the question.

Let's talk about how we're thinking about it. So we mentioned $4 billion in 2024, approximately $4 billion and this is all about our latest stage pipeline coming to fruition. So in 2020 Ford will launch R. C. But it's mostly kind of in the second half their sales and then we'll have a full year of 2025 said that'll providing rose.

James Mock: We will also come to market with flu in 2025. We’ll also come to market with a combination of flu and COVID in 2025. Again, depends on timing, but by 2026, we should have a full portfolio. So, we’re not going to say what the exact sales numbers are, but you mentioned US$8 billion to US$9 billion in costs.

Also come to market with flu.

In 2025 will also come to market with a combination of fluid in Covid in 2025.

Again depends on timing, but by 2026, we should have a full portfolio. So we're not going to say what the exact sales numbers are but you mentioned $8 billion to $9 billion in costs not exactly sure where you get there unless you're assuming a certain sales line on that but.

Again depends on timing, but by 2026, we should have a full portfolio. So we're not going to say what the exact sales numbers are but you mentioned $8 billion to $9 billion in costs

James Mock: I’m not exactly sure where you’d get there unless you’re assuming a certain sales line on that, but let me go back to what we tried to lay out here. If you assume, for instance, US$6 billion in sales, we should have 30% of cost, or US$8 billion in sales, we should have 25% of cost. And then, we’ve said historically in our R&D Day that we need US$25 billion overall to make this investment, which should average US$5 billion a year. So, hopefully, we’re giving you enough pieces without officially guiding any kind of numbers in 2026. But here’s what’s also important is, if those sales don’t come to fruition, we are telling you that we will adjust our expenditures in our investment. So, that’s — we hope that they will, we are confident in our pipeline, but should it not happen, then we were prepared to adjust our investment.

Let me go back to what we tried to lay out here.

If you assume for instance, $6 billion. So we should have 30% of costs or $8 billion sales, which has 25 per cent cost.

And then we've seen historically there aren't ebay that we need to $25 billion overall to make this investment which should average $5 billion a year. So.

James Mock: So, hopefully, we’re giving you enough pieces without officially guiding any kind of numbers in 2026. But here’s what’s also important is, if those sales don’t come to fruition, we are telling you that we will adjust our expenditures in our investment. So, that’s — we hope that they will, we are confident in our pipeline, but should it not happen, then we were prepared to adjust our investment. I missed the second part of the question.

Hopefully, we're giving you enough pieces without officially guiding any kind of numbers in 2026, but but here's what's also important is if those sales don't come to fruition were telling you that we will adjust our expenditures in our investment.

So that we hope that we are they will we are confident in our pipeline, but should it not happened and we weren't prepared to adjust our best.

I missed the second part of the question.

Arpa Garay: Capacity.

James Mock: Gena, can you maybe repeat the second part of your question? I apologize. I missed it.

Oh.

Can you <unk> can you make me repeat the second part of your question I apologize I missed it.

Gena Wang: Sure. Basically, after manufacturing resizing, what is the full capacity regarding doses, and what percentage will be internal?

James Mock: Yeah, thank you for the question. As we try to lay out here and are showing you, this capacity is built for volume leverage. So, we at least put US$10 billion of sales on that page, and it will require no additional capacity. We will complete, of course, over the next year and a half the U.K facility, the Canada facility and Australia facility, but for the respiratory framework, we need no more, at least the US$10 billion. I won’t project beyond that, but that should answer that question. INT is a little bit different and we are building that and getting that ready for commercial purposes, but we’re built for volume leverage moving forward.

So we and we tried to lay out here and are showing you. This capacity is built for volume leverage. So we at least put $10 billion of sales on that page and it will require no additional capacity, we will complete of course over the next year and a half the UK facilities of Canada facility in Australia facility, but for the <unk>.

Respiratory framework, we need no more at least 10 billion I'm old project beyond that but you know that that should answer that question I mean, he's a little bit different and we're building that I'm getting that ready for commercial purposes.

But.

Bill for volume leverage moving forward.

Gena Wang: Thank you.

Operator: Our next question comes from Salveen Richter with Goldman Sachs. Your line is open.

Salveen Richter: Good morning. Thanks for taking my questions. Two from me here. One is, you provided guidance of about US$4 billion between COVID and RSV on the forward here for 2024. Could you just speak to the contribution from each and how you’re thinking about flu monotherapy? And the second question is that your financial framework for 2025 includes the ability to flex R&D and SG&A. Are there any parameters you can share on the range of this flexibility and how you would prioritize R&D programs and development? Thank you.

Framework for 2025 include <unk> are there any parameters you can share around the wage a range of this flexibility and how you would prioritize R&D programs and development. Thank you.

Yeah. Thanks I.

James Mock: Yeah, thanks, Salveen. I appreciate the question. So, on the US$4 billion, we’re not going to break out the US$1 billion that we attributed to RSV and COVID. All we can say is we’ve talked about our PDUFA date and that we filed in certain amount of countries across the globe. I will also say, as Arpa mentioned in her prepared remarks that we’re super confident in the product profile. We are encouraged by the market and how it’s already started from an uptake perspective, and we think we will compete very well in 2024 and beyond. As it pertains to the flexing on our spending for 2025, obviously, I don’t know, 80% of our expenses or investments are in R&D, so US$4.5 billion for R&D and US$1.3 billion for S&A. So that, as I mentioned, 50% of the current spending levels is not committed.

We were encouraged by the market and how it's already started from an uptake perspective, and we think we will compete very well.

James Mock: We are encouraged by the market and how it’s already started from an uptake perspective, and we think we will compete very well in 2024 and beyond. As it pertains to the flexing on our spending for 2025, obviously, I don’t know, 80% of our expenses or investments are in R&D, so US$4.5 billion for R&D and US$1.3 billion for S&A. So that, as I mentioned, 50% of the current spending levels is not committed.

Poor and beyond.

As it pertains to the flexing on our spending for 2025.

Obviously, I don't know, 80% of our expenses or investments are in R&D, So $4.5 billion for a needle of $23 billion for SG&A. So Ah that as I mentioned, 50% of the current spending levels is not committed so we have time to make decisions and watched the market to be able to say what.

James Mock: So, we have time to make decisions and watch the market to be able to say what amount of registrational trials and what amount of R&D are we going to spend in 2025. So, hopefully that gives you a sense for how much is still the ability to flex. We also have other levers that we can pull, et cetera. SG&A, we also have some flexibility, probably not to the same magnitude, but there is still some amount of flexibility to bring that down from a variable expense perspective.

Registrational trials and what amount of R&D are we gonna spend in 2025. So hopefully that gives you a sense for how much they still have the ability to flex. We also have other levers that we can pull et cetera, SG&A and we also have some flexibility probably not to the same magnitude.

But.

But there's still a certain amount of flexibility to bring that down.

From a variable expense perspective.

Stephane Bancel: And Salveen, this is Stéphane. Maybe just to add to Jamey’s point on the R&D, as I mentioned in my remarks, if we have to, we will be open, of course, to partnership some of those programs, which is an important way we could flex the R&D number based on where the sales are, as Jamey mentioned, which is if the sales are according to our plan, then we’re going to be okay. If the sales are below, we will be very open to partnering. As you know, we’ve done that in the past. The team knows how to do it. But we will be disciplined about our investments in the business based on where the sales line is.

If we'd have to where we'd be open enough postal partnerships. Some of those programs, which is Ah Ah Nipple, then we would flex beyond the number.

Based on whether to satisfy all extreme you mentioned would choose you would stand as offerings walk on that we're gonna be OK <unk> says beetle Ah, we we'd be very open to partner he doesn't know.

Past the team knows how to do it.

But it wouldn't be disappearing.

Oh investments into business Basil web satisfy needs.

Operator: Thank you. Our next question comes from Eliana Merle with UBS. Your line is open.

Unknown: Hi, this is Sarah on for Ellie. Thanks so much for taking our question. First, I guess, can you talk about in 2024 again on that US$1 billion RSV international sales number? Are you expecting any contribution from flu in ’24, and maybe how you’re thinking about it into ’25? And then, on CMV, can you talk about where you are in cases and how they’re tracking versus R&D Day where I think you said a fourth of them were currently tracked? That would be great. Thanks so much.

First I guess can you talk about in 2024 I got on that 1 billion R. As me International sales number are you expecting any contribution from Leland 24, Uhm and maybe how you're thinking about it into 25 and then on C. N. Z can you talk about where you are and can you said.

<unk> alright.

You said a fourth of them work.

Currently chat that'd be great. Thanks, so much.

James Mock: So, thanks, Sarah. I’ll take the first part and then hand it over to Stephen on CMV. So, there is no flu contribution in our 2024 sales outlook of approximately US$4 billion. So, in that US$1 billion, that is solely RSV and other COVID international sales. We do, as I mentioned in my — to answering Salveen’s question, we do expect to launch flu in our combination products sometime in 2025, and we’ll see what we’ve projected that time.

There is no flu contribution in our 2000 2004 sales outlook of approximately $4 billion in that $1 billion.

Or that is solely RSD and other Covid international sales.

What did you do as I mentioned in MA.

To answering a cell means question, we do expect to launch flu and our combination products sometime in 2025 and we'll see.

What we've projected at that time.

Stephen Hoge: And on the CMV question, thanks for that. So yes, we did update that we’re about a quarter of the way through the case accrual back in R&D Day. I think the next — we continue to accrue cases at a steady pace. I do think the next update will provide is likely our Vaccines Day in the spring.

Unknown: Okay, thanks.

Operator: Our next question comes from Terence Flynn with Morgan Stanley. Your line is open.

Terence Flynn: Great. Thanks so much for taking the question. I know GSK has provided an estimate in terms of size of the RSV market, about £5 billion, and Pfizer has given some metrics as well. Given what we’re seeing now with these early launches, can you provide us with your assessment of total market size here? And then given some of your comments on competing with larger companies, as you’re doing in COVID now, where ultimately do you see your market share shaking out in the RSV space? Thank you.

And then given some of your comments on competing with with larger companies. You know as you are doing in Covid now where ultimately do you see your market share shaky now it's in the the RSV space. Thank you.

Arpa Garay: Thank you for the question. In terms of the total RSV market, as I mentioned earlier, we’re excited by the uptake and the consumer awareness of the market overall. And our projections are similar to what both GSK and Pfizer have already guided. In terms of our market share with RSV, we have not yet provided or are ready to provide any forward-looking projections on share, but we are very excited about our strong product profile, both in terms of efficacy, safety, and, as I mentioned, our ready to use pre-filled syringes. So, we will be leveraging the learnings and the success from our COVID commercial launch this year and applying them to RSV next year.

Thank you for that question in terms of pet turtle RNC market as I mentioned earlier, we are excited by the uptake in the consumer awareness aftermarket alcohol in our projections are similar to pop up J F. K in Pfizer I have hardly diabetic.

In terms of our market share with me, we have not yet provided.

Need to provide any far reflecting projections on sure, but we are very excited about our strong product profile. So I'm trying to think of advocacy Saint <unk> and as I mentioned are ready to use Prince helps around cats. So we will be leveraging that learning and the success from our code that commercial launch S here and applying.

Them to RMC next year.

Stephane Bancel: Yes. Just to add to Arpa, Terence, it’s Stéphane, the point that Arpa and I made about the market share of COVID is what I think is very important. I think some people believe that because we’re a new company in commercials we’re not able to compete and I think the market share data that Arpa has shared really show that our U.S team is able to compete and we will continue to improve things that we are doing, because we are not done improving the [inaudible] culture as you know us. But the share already moving from 36% last year to 45% cumulative so far in the season, I think it’s already a demonstration of what the team is able to achieve. And the season is not over, so that’s 51%. So, let’s see where this one finish when the season is over.

I think some people believed because ruins your company to combat shoulders.

Okay.

And I think the market shut.

How 'bout shafter each show that all you have to keep he's able to compete Ah.

And we will continue to improve things. That's what we are doing cause we're not done improving contrails, who knows but the shower already you know movie called for up to 6% last year 245 per cent coming out to you. So far in the season I think it's only a demonstration of what the team he's able to achieve and does she doesn't even authority. So that's where you got 51.

Okay. So let's see what these wants to finish when the season is over.

Stephane Bancel: But basically, the differences we have, as I mentioned, I’ve been speaking to pharmacist leadership. And they are all, I think, have a very big workload issue, as you know. There’s even strikes in some pharmacy chains in the U.S as we speak. And you think about the season there, [inaudible] business for the pharmacy for preparations, and then the flu, and then the COVID. And then, as I mentioned, those two other products, if you just download the label of those products from the FDA website and you look at how many steps they have, it’s very complicated. And when you talk to a pharmacy leadership, they don’t know how they’re going to deal with that type of workload. And so, coming with pre-filled syringe is a tremendous differentiator.

And they are or you know I think it was very big walk growth issue was you know a busy constructing some pharmacy in the U S. As we speak.

And you're being able to see it on the board when would it be sent to a pharmacy from progression and then the flu and then the coffee and then that was being as I mentioned those two of our products. If you just download the labor of those products bump you up to your website. Then you look at how many steps there.

Stephane Bancel: And then, as I mentioned, those two other products, if you just download the label of those products from the FDA website and you look at how many steps they have, it’s very complicated. And when you talk to a pharmacy leadership, they don’t know how they’re going to deal with that type of workload. And so, coming with pre-filled syringe is a tremendous differentiator. We have very good efficacy. We have very good safety profile. We really believe that we have the best in-class product in the market. And [inaudible], it’s going to translate, I think, into a very good effect.

It's a very complicated and when you talk to a pharmacy. This year. They don't know how are we going to deal with that separately what growth and so coming refused to arrange he's a tremendously frustrated so I have a very good you know if you could see we're very good safety profile, we really believe that script.

Stephane Bancel: And when you talk to a pharmacy leadership, they don’t know how they’re going to deal with that type of workload. And so, coming with pre-filled syringe is a tremendous differentiator. We have very good efficacy. We have very good safety profile. We really believe that we have the best in-class product in the market. And [inaudible], it’s going to translate, I think, into a very good effect.

Stephane Bancel: We have very good efficacy. We have very good safety profile. We really believe that we have the best in-class product in the market. And [inaudible], it’s going to translate, I think, into a very good effect.

Best interests product in the market and walk me through it if you don't come easily phosphates I think into a very quickly.

Operator: Thank you. Our next question comes from Jessica Fye with JPMorgan. Your line is open.

Jessica Macomber Fye: Hey, guys, good morning. Thanks for taking my question. Just a couple coming back around to one that I think some others were trying to get at, but maybe a little differently. When we think about breakeven in 2026, what are you contemplating in that sales number embedded in your assumption? Does it reflect just respiratory vaccines? Or are you considering INT could be on the market then? And then second, I know you said the percentage of non-retail jobs would grow as the season progresses from where it has been so far this season. Do you believe that the proportion of COVID shots running through the retail channel has shifted at all, bigger picture in 2023 relative to 2022, or should we think of that proportion as remaining similar year-over-year? Thank you.

Thanks for taking my question.

Just a couple coming back around <unk> trying to get at maybe a little differently.

Do you think about breakeven in 2026.

What are you contemplating that sales number embedded in your assumption does it reflect yes, respiratory vaccines or are you considering I N T E on the market then.

Jessica Macomber Fye: And then second, I know you said the percentage of non-retail jobs would grow as the season progresses from where it has been so far this season. Do you believe that the proportion of COVID shots running through the retail channel has shifted at all, bigger picture in 2023 relative to 2022, or should we think of that proportion as remaining similar year-over-year? Thank you.

And then second.

And you said the percentage of non retail jobs <unk>. This evening progressive from where it has been so far this evening do you believe.

But the proportion mm.

Perfect shots running through the retail channel has shifted it I'll take a picture in 2023 relative to 2022 or should we think of that proportion what's remaining similar year over year. Thank you.

James Mock: Yeah. Thanks, Jess, for the question. Again, without getting into too much detail on 2026 in terms of how we think about it, I mean, the best way to keep going back to that late-stage pipeline that we’ve been talking to you about, RSV, flu, our combination, our next-gen COVID product as well, will all be very much there for the year 2026. And we are confident in all those product profiles and how we will compete. As I mentioned, at 6%, our cost of sales — at US$6 billion, sorry, our cost of sales would be 30%. At US$8 billion, our cost of sales would be 25%. And of course, we’ll try to improve on that. And that will give us the envelope for how much we can continue to invest in the future products, which we said we’ll launch 15 by 2028.

You too thanks for the question.

Again without getting into too much detail of 2026 and in terms of how we think about it I mean.

The best way to keep going back to that late stage pipeline that we've been talking to you know RFP flu or combination are nexgen COVID-19 product as well will all be very much there for the year of 2026.

And we are confident in all those product profiles and how we will compete.

James Mock: As I mentioned, at 6%, our cost of sales — at US$6 billion, sorry, our cost of sales would be 30%. At US$8 billion, our cost of sales would be 25%. And of course, we’ll try to improve on that. And that will give us the envelope for how much we can continue to invest in the future products, which we said we’ll launch 15 by 2028.

As I mentioned at 6% our cost of sales, but that $6 billion sorry, our cost of sales would be 30% at $8 million a cost of sales would be 25% and of course, we will try to improve on that and that will give us the envelope for how much. We can continue to invest in the future products with resetting alarms 15 by 2028 that'll be all of our relating platform.

James Mock: That’ll be all of our latent product portfolio, that’ll be our INT portfolio, that’ll be our rare disease portfolio. So, I think that’s as much as we can say right now. I just want everybody to know that we are very committed to breaking even in that year, and we have a lot of flexibility, both from a growth standpoint and a discipline investment standpoint.

Folios that'll be our IMT portfolio that will be a rare disease portfolio. So I think that's as much as we can say right now I just want everybody to know there'll be a very committed to breaking even in that year and we have a lot of flexibility both from a growth standpoint.

Arpa Garay: Great. And I can take the second question on the percentage of non-retail. So, as expected, in 2023, the retailers have been the majority of the market, with more than 90% of the volume during the first few weeks. However, we’re now beginning to see a shift towards more non-retail channels, as I had mentioned. We are seeing increased shipments to IDNs, to clinics, to pediatricians, as of the recent weeks. And as I think about full year 2023, I believe the retail mix will be stronger than in 2022 and could land at about 70% to 80% of total vaccinations, whereas in 2022, we saw that the retail channel was only about two-thirds of the mass.

And I can take a second question on the percentage of non retail so as expected in 20 train three Ah retailers have been the majority of the market with more than 90% of the volume during the first few weeks.

I remember now beginning to see a shift towards more nonretail channels that as I had mentioned, we are seeing increased shipments to ibm's to clinics to pediatricians assets of recent weeks and as I think about full year 2023, and I believe the retail next will be stronger than in 2022.

And could land at about 70 to 80 per cent of total vaccinations.

Whereas in 2020 chill at least at the retail channel that's only about two thirds of the math.

Operator: Thank you. Our next question comes from Luca Issi with RBC Capital. Your line is open.

Luca Issi: Oh, great. Thanks so much for taking my questions. Maybe circling back on the P&L, I appreciate all the effort on resizing manufacturing and the focus on gross margin, but how should we think about OpEx plus CapEx? As COVID numbers continue to come down, we’ve seen the BioNTech and Pfizer materially realigning OpEx plus CapEx to their top-line. I believe BioNTech lowered by US$600 million this year and Pfizer by US$1 billion this year and US$2.5 billion next year. However, your OpEx plus CapEx is not materially changed this year and you anticipate that the next year it’s going to be generally flat to down. So, can you just maybe comment on why you think that’s the right strategic decision for the organization? And then maybe second question on RSV.

Luca Issi: I believe BioNTech lowered by US$600 million this year and Pfizer by US$1 billion this year and US$2.5 billion next year. However, your OpEx plus CapEx is not materially changed this year and you anticipate that the next year it’s going to be generally flat to down. So, can you just maybe comment on why you think that’s the right strategic decision for the organization? And then maybe second question on RSV.

I believe by an impact lowered by 600, <unk> $200, a year and $2.5 billion next year. However, you're all pass less capex is not materially changed this year in United States that the next year is going to be generally flat to down. So it can just maybe calm into why you think that the rights strategic decision for.

The organization and then maybe second question Rsp's, obviously impressed his initial launch by Gsk's, Pfizer and appreciated differentiations of your products.

The organization and then maybe second question Rsp's,

Luca Issi: Obviously, impressive initial launch by GSK and Pfizer and appreciate the differentiations of your product. But what’s the latest thinking on whether the vaccine is needed every year or less frequently than that? Is there a scenario where Pfizer and GSK penetrate the market pretty aggressively this year and then you face an uphill battle next year as it turns out that we need a vaccine maybe every other year and not every year? Any thoughts there much appreciated. Thanks so much.

Oh, what's the latest thinking on whether the vaccine is needed every year or less frequently than that is there sitting here with Pfizer you escaped penetrated market's pretty aggressively this year and then you face an uphill battle next year and just turned down did you need a vaccine maybe every other year and not every year and he's not there much appreciate it. Thanks so much.

Stephen Hoge: Maybe I’ll take the second part of that question and then hand it over to Jamey for the first. So, on RSV and the need for it, obviously, we’re continuing to follow the public health situation in terms of the rate of occurrence of the RSV epidemic this year. At this point, I think we don’t have data yet on whether or not it will ultimately be an annual or something less than annual, say every two or three year vaccination regime. I think like everybody else, we’ll be looking to our data, the other manufacturers’ data, as well as the public health, the epidemiologic data to guide that decision. There are plenty of vaccines for which there is an approach, flu as an example, where there’s a seasonal vaccination approach, both because of the benefit offered by the vaccine, but also because of the convenience of just making sure that every season, every year, people are reminded to get that vaccine.

Obviously, we are continuing to follow up the public health situation in terms of the <unk> the rate of recurrence theosophy.

[noise] epidemic. This year at this point I think we we don't have data yet on whether or not it will ultimately be an annual or something less than annual say every two or three year vaccination regime, I think like everybody else will be looking to our data the other manufacturers data as well as the public health the epidemiologic data.

Stephen Hoge: I think like everybody else, we’ll be looking to our data, the other manufacturers’ data, as well as the public health, the epidemiologic data to guide that decision. There are plenty of vaccines for which there is an approach, flu as an example, where there’s a seasonal vaccination approach, both because of the benefit offered by the vaccine, but also because of the convenience of just making sure that every season, every year, people are reminded to get that vaccine.

To guide that decision there are plenty of vaccines for which.

There was a approach or includes an example, where the the seasonal vaccination approach.

Both because of the benefits offered by the vaccine, but also because of the convenience of just making sure that every season.

Every year people over a month to get that vaccine. So the ultimate decision on whether this is going to be recommended not ours. So manufactured old Faldo public health officials based on a number of factors, which will include the upbeat and the data will provide that but other factors as well.

Every year people over a month to get that vaccine.

Stephen Hoge: So, the ultimate decision on whether this is going to be recommended is not ours, the manufacturer, it will fall to public health officials based on a number of factors, which will include the FDA and the data we provide, but other factors as well. And we’ll work to make sure they have the data they need to make that decision.

To make sure they have the day they need to make that decision.

James Mock: And I’ll take the first part. Thanks, Luca, for the question. I think the short answer is the opportunity set ahead of us, and we are acting. So, you referenced some of our competitors, so I just want to break that down. I mean, we are super encouraged by the opportunity for additional growth and our ability to impact patients. And we have this 15 products that we think will launch by 2028 or by 2025. We think that’s the right thing to do. We have to grow out of our, we have to grow this company and to be able to afford the investment to be able to capture the unparalleled opportunity for this. And I think we are acting, I believe we are acting, and I mentioned everything that we’re doing from a cost of sales perspective.

We have this team products that we think will launch by 2028 swore by 2025, and we think that's the right thing to do we have to grow out of our we had to grow this company and to be able to afford the investment to be able to capture the unparalleled opportunity for this and I think we are acting I believe we are and I think that I mentioned everything that we're doing it from.

James Mock: We think that’s the right thing to do. We have to grow out of our, we have to grow this company and to be able to afford the investment to be able to capture the unparalleled opportunity for this. And I think we are acting, I believe we are acting, and I mentioned everything that we’re doing from a cost of sales perspective.

Cost of sales perspective, and so I think that's very much in line and sized appropriately to have volume leverage when incomes because it will come.

Cost of sales perspective,

James Mock: And so, I think that’s very much in line and sized appropriately to have volume leverage when it comes, because it will come. And we are saying in 2024, we can adjust both R&D and SG&A down to a good level, down 6% R&D, down 13%, so, on SG&A. We are largely committed to our registrational trials for 2024. But as I mentioned, we don’t have as much flexibility in that particular year, but by 2025, we have even more flexibility. So we’re prepared to take action should we need to, but we’re very optimistic about the price line that’s coming. And hopefully this will just come through growth, and we’ll still be able to afford much of this investment.

And we are saying in 2024, we can adjust both orange Ian SG&A down to a good level down 6% R&D, 13%. So on SG&A, we are largely committed to our registration of trials for 2024, but as I mentioned, we don't have as much flexibility in that particular year, but by 2025, we have a bit more flex.

James Mock: But as I mentioned, we don’t have as much flexibility in that particular year, but by 2025, we have even more flexibility. So we’re prepared to take action should we need to, but we’re very optimistic about the price line that’s coming. And hopefully this will just come through growth, and we’ll still be able to afford much of this investment.

Ability. So we're prepared to take action should we need to but we're very optimistic about the price line, that's coming and hopefully this will just come through growth and will still be able to afford a bunch of this investment.

Stephane Bancel: It’s Stéphane. Just maybe adding to Jamey, who said it super well. As you know, we have a platform company. And the public opinion success of those programs we feel very good about. If you just look at with COVID and phase III RSV — sorry, and phase III for RSV and phase III for flu, we have three out of three positive phase III. This is not your industry average. So, we think we can create value and create return on capital for shareholders by investing that capital to high-priority projects that are in late-stage pipeline. As I said, we have the largest late-stage pipeline of any mRNA company. We have six programs right now. And as soon as we launch [inaudible], which is very, very soon, there’s going to be seven programs. We believe the best way to create returns for shareholders is to invest that capital to drive sales growth and profitability.

As you know we have a platform company and the primary care Pycnium success of those programs would be very good about if you just took us we'd go visit and faithful.

<unk> so in Pittsburgh Orange.

Group of fruit got free up rebuilding phase Crazy she doesn't your industry average. So we think we can create value increased retail capital for shareholder of spy interesting that's capital some high priority project I'm trying to live search pipeline as I figured wherever locked escalation spectrum of any amount of company with six program right now and.

Stephane Bancel: So, we think we can create value and create return on capital for shareholders by investing that capital to high-priority projects that are in late-stage pipeline. As I said, we have the largest late-stage pipeline of any mRNA company. We have six programs right now. And as soon as we launch [inaudible], which is very, very soon, there’s going to be seven programs. We believe the best way to create returns for shareholders is to invest that capital to drive sales growth and profitability.

As soon as the non stops what she's very very soon is going to be seven Oh God. We believe the best way to create rebuilt to wash I'll go with the sweet.

So to drive to set his girlfriend a whole separate issue.

Luca Issi: Thanks so much.

Operator: Our next question comes from Michael Yee would draft for each of your line is open.

Unknown: Hi. Thanks for taking our question. This is Dina on for Mike. I just wanted to get a sense of your assumptions for Q4 COVID jabs and what are you seeing in Q4 right now? How much of that is actually jabs and actual injections versus channel fill? And just to follow-up on that. Now that you’ve seen sort of half of the 2023 fall season play out, what are your assumptions for 2024 and 2025 for COVID? Are you essentially assuming that the same people who got vaccinated this year will continue to get COVID vaccine every year? Thanks so much.

For Covid jobs, and what have you seen Keith for right now how much of that is actually you know jobs excellent injections versus versus channel cell.

Just to follow up on that now that you've seen sort of pass up.

2023 fall season play out what are your assumptions for 20th 2024 and 2025 for Covid are you essentially assuming that the same people who got vaccinated. This year will continue to get Covid vaccine every year. Thanks, so much.

Arpa Garay: Thank you for the question. In terms of the fourth quarter ’23 jabs, what we saw in 2022 is there was a significant portion, about 45% of the total COVID vaccinations happening in November and December. This year, we’re expecting a similar split, likely larger, given that we launched two weeks later into the season in 2023 than we did last year. And what we are hearing from our different non-retail customers, as well as our retail pharmacy partners, is they are planning vaccination campaigns and marketing efforts to really capture on the November and December months. So, in total, we do anticipate getting to at least 50 million doses this year, and we do believe that November and December will be strong months for us.

This year, we're expecting a similar split likely larger given that we launched two weeks later in the season. In 2023, then we'd get last year and what we are hearing from our different nonretail customers as well as our retail pharmacy partners and they are planning a vaccination campaigns and marketing efforts.

Arpa Garay: And what we are hearing from our different non-retail customers, as well as our retail pharmacy partners, is they are planning vaccination campaigns and marketing efforts to really capture on the November and December months. So, in total, we do anticipate getting to at least 50 million doses this year, and we do believe that November and December will be strong months for us.

To really capture on the November and December months fell.

In total we do anticipate getting to at least 50 million doses. This year and we do believe that November and December will be strong enough for us and.

Arpa Garay: In terms of 2024, our assumption is everyone who has gotten their booster in 2023 will at least get their booster also in 2024 and beyond. Now, given the higher burden of disease with COVID, as consumers become more understanding of the annual recommendations and as the convenience of getting both flu and COVID becomes more normalized, we do believe over time we’ll start to see some increase in the overall COVID market.

Now given that higher burden of disease that covered as.

As consumers become more understanding of the annual recommendations.

And as a convenience of getting the flu and Calvin becomes more normalized we do believe over time will start to see some increase in the overall it market.

Operator: Our next question comes from Hartaj Singh with Oppenheimer. Your line is open.

<unk> comes from Heart touch thing with Oppenheimer. Your line is open.

Hartaj Singh: Great. Thank you for my question. I just got a question on the combination programs. And just to give a little bit of - frame the question, in other therapeutic areas, aside from vaccines for infectious diseases, for example, oncology, monotherapy treatments generally tend to be minority of treatments, 10%, 15%, 20%. Currently, monotherapy vaccines dominate the market in COVID-19 flu. So, when you get the combination vaccines going, do you imagine - does your market research tend to suggest that you would, again, probably a combination approach might dominate that versus a monotherapy approach, singular vaccines going forward? And then secondly, will the cost of goods sold be any different for the combination versus the monotherapy products? Thank you.

And just to give a little bit of.

Framed the question.

Therapeutic areas aside from vaccines for infectious diseases. You know for example, oncology monotherapy treatments generally tend to be a minority of treatments 10 15, 20%.

No currently monotherapy vaccine dominate the market COVID-19 flu. So when you get the combination vaccines going you know do you imagine do market research tend to suggest that you would again, probably a combination approach my dominate that versus a mono therapy approach singular vaccines going forward.

Hartaj Singh: So, when you get the combination vaccines going, do you imagine - does your market research tend to suggest that you would, again, probably a combination approach might dominate that versus a monotherapy approach, singular vaccines going forward? And then secondly, will the cost of goods sold be any different for the combination versus the monotherapy products? Thank you.

And then secondly will the cost of goods sold be any different for the combination versus the mall therapy products. Thank you.

Arpa Garay: Great. Thank you for the question. So, we do anticipate that our combination vaccine will take a substantial share of the monotherapy vaccines that are available. We have seen in the pediatric vaccine market that upon availability of combinations, you see very strong uptake and conversion from monos to combinations, and we expect a similar trend in the adult market. From our market research, we have heard consistently from consumers that they prefer one shot over multiple shots. From a customer perspective, we are hearing, as Stéphane had mentioned, just with workload issues, one shot saves a lot of time and also helps them to get more patients protective. And from a broader healthcare system and government and payer perspective, we are hearing an increased need to help get greater uptake and compliance in adult vaccinations.

<unk> to combinations and we expect a similar trying to me at the market.

From our market research, we have tried consistently from consumers that they prefer one shot of or multiple shots.

I'm from a customer perspective, we are hearing asking if I had mentioned his workload issues. One shot since the last time and also helps them to get more patients protected and from a broader healthcare system and government impair perspective, we are hearing an increase need to help get greater uptake.

Arpa Garay: From a customer perspective, we are hearing, as Stéphane had mentioned, just with workload issues, one shot saves a lot of time and also helps them to get more patients protective. And from a broader healthcare system and government and payer perspective, we are hearing an increased need to help get greater uptake and compliance in adult vaccinations.

Compliance and adult vaccinations.

Arpa Garay: And our healthcare authorities believe that combinations can help actually boost the vaccination rate. So, we are very excited about our combination products in the future and think this could really be an inflection point for our mandatory vaccines.

Stephane Bancel: Yes, it’s Stéphane. Just to add to Arpa’s comments, during COVID, we’ve been discussing to a lot of - with healthcare ministers, and the topic of vaccination combination has come a lot. And as you think, especially outside the U.S, where you have a lot of [inaudible] taking care of people from birth to death, basically, we are very, very interested in combinations. Because they know that if a participant of a country got the vaccine, they got protection against several viruses, which prevent hospitalization. As you know, we’ve done partnership with some countries like the UK, Canada, and Australia. And through those negotiations, the concept of combination was critical in their decision-making. Because as they see their population getting older, they worry that the number of hospitalizations will just go up over time and the ability to prevent that when you see shortages of healthcare workers and as you project those shortages in the future is a key determination of a decision.

And the topic of vaccination combination that's coming off and.

And as we speak, especially outside the U S where are you able to come up with a quote goes I've got a system, where you Wanna pay you have to go out to.

Before we go from birth to death basically you are very very interested in combinations. Because we know that people were <unk> of a concrete goes to the vaccine because I've got several.

The balance sheet, which prevents us prepare mutation as you know we've done partnership with some countries.

Stephane Bancel: As you know, we’ve done partnership with some countries like the UK, Canada, and Australia. And through those negotiations, the concept of combination was critical in their decision-making. Because as they see their population getting older, they worry that the number of hospitalizations will just go up over time and the ability to prevent that when you see shortages of healthcare workers and as you project those shortages in the future is a key determination of a decision.

Like the U K, Canada, and Australia and for those negotiations.

A combination of west critical into this shouldn't makings cause if they see their population gives you all go.

They will read that she was number almost perdition with just go up over time and do you have anything to prevent that when you would see shortages of has kept walk up and that'd be perfect. Those sorts of these in the future is cheesy termination of their decisions. So what do you think he'd he'd be glad to discuss system. The drive to book, a combo would move even faster, but actually in the commercial market.

Stephane Bancel: So, I only think in integrated healthcare system, the drive the [inaudible] will move even faster than actually in commercial markets like the U.S market.

James Mock: And, Hartaj, maybe I’ll take the cost of sales question. Thank you for it. So, this provides a substantial margin expansion opportunity. So, if you think about it, our cost of sales, the smallest portion is our drug substance, so it’s our actual mMRA, and that’s a very small portion of our overall cost of sales. Everything from drug product in terms of the cost to finish the product and the presentation type, whether it’s PFS or a vial or whatever, that now gets cut in half. So, when we sell two, it’s a very limited amount of cost increase versus a single presentation. So, it does provide a significant margin expansion opportunity. So, thank you for the question.

Yeah, and ER, our task, maybe I'll take the cost of sales question. Thank you for it. So just provide a substantial margin expansion opportunity. So if you're thinking about at our cost of sales. The smallest portion is or drug substance. So it's our actual M. R. A and that's a very small portion of our overall cost of sales everything from drug product.

In terms of the cost of finished the product and the presentation type, whether it's PFS or violent or whatever that now it gets cut in half. So when we sell too. It's a very limited amount of cost increase versus a single presentation. So it does provide a significant margin expansion opportunities to thank you for the question.

Ha: Thank you all.

Operator: Our next question comes from Evan Wang with Guggenheim Securities. Your line is open.

Evan Wang: Hey guys, thanks for taking the question. Appreciate you guys sharing early thoughts on ’24 and beyond. For ’24 specifically, you talked about some of the contribution from COVID and RSV in terms of split. It sounds like you plan to hit the ground running there in RSV. With international, how are you thinking about the longer-term contribution from COVID as competitor agreements expire? And with flu, with the comments on marketing in ’25, wondering if you’ve had any recent conversations with the regulators there, in terms of potential approval. Thanks.

For two lines for specifically you talk about some of the contribution from Conan RSV.

In terms of the split it sounds like a plan to hit the ground running there and RSV.

International how are you thinking about the longer term contribution from Covid as competitor.

Mmm agreement expire.

And with flu with the comments on you know on March 25.

Wondering if you've had any recent conversations with regulators there in terms of.

Central approval. Thanks.

Arpa Garay: [inaudible]. Thank you for the question. In terms of our expectations in 2024, we have put about US$1 billion across international COVID and RSV. We do anticipate a strong launch in the second half of the year with RSV. And on the international side for COVID, we are continuing to pursue multiple options across a number of countries. In Japan, we will be in a fully commercial market, is our expectation, where we will be competing for the Japanese business. In the EU, we continue to work with countries on agreements to secure our COVID-19 vaccine. As publicly disclosed, the EU has renegotiated their contract with Pfizer earlier this year. So, the EU demand has been substantially satisfied in many markets, but we are hearing from individual member states that they are looking for a second supplier for vaccines.

Thank you for that question in terms of.

Our expectations and train 24, and we have a quiet about $1 billion across international carbon and RFE. We do anticipate strong launch in the second half of the Arab Orange me and on the international side for Covid, we are continuing to pursue a multiple options across a number of countries.

In Japan, we will be in a fully commercial market is our expectation will be competing for the Japanese business and the E. U. He continued to work with countries on agreements to secure our on the COVID-19 vaccine.

Arpa Garay: In the EU, we continue to work with countries on agreements to secure our COVID-19 vaccine. As publicly disclosed, the EU has renegotiated their contract with Pfizer earlier this year. So, the EU demand has been substantially satisfied in many markets, but we are hearing from individual member states that they are looking for a second supplier for vaccines. And we are in those discussions right now, both at a country level, but also at a European Commission level to see if a joint procurement agreement can be established in 2024.

I'm as publicly to skull, it's closed the E. U has renegotiated their contract by Pfizer earlier. This year. So the EU demand has been substantially satisfied in many markets, but we are hearing from Indian virtual member states that they are looking for a second supplier for vaccines.

And we are in those discussions right now both at a country level, but also at a European commission level to see if a joint procurement screen that can be established in 2024.

Stephen Hoge: And thank you for the flu question. So, as you referenced, we had really strong data out of our P303 phase III study for flu that we released at R&D Day. We’re excited about that. We are engaging right now with multiple regulators about the pathway to licensure. I don’t have an update about all those conversations because they’re happening as we speak, but we will, once we have clarity across all markets on the pathway licensure, provide an update.

Speak, but we will once we have clarity across all markets on the pathway to licensure provide an update.

Operator: Thank you. Ladies and gentlemen, this does conclude the Q&A portion of today’s conference — end of the call itself. You may now disconnect, and have a wonderful day.

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