Q4 2024 Moderna Inc Earnings Call
Luke: And your hand is raised to withdraw your question. Please press star wouldn't want again. Please be advised today's conference is being recorded I would now like to turn the conference over to your speaker today living it to Luke talk. Please go ahead.
Luke: Thank you Kevin.
Luke: Everyone and thank you for joining.
Today's call to discuss <unk> fourth quarter and full year 2024 financial results and business update you can access the press release issued this morning as well as the slides that we'll be reviewing by going to the investors section of our website.
Luke: On today's call are Stefan Bombshell, Chief Executive Officer.
Speaker Change: Jamie Loch Chief Financial Officer.
Stephen Hoge: Stephen Hoge President.
Stephen Hoge: 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 two of the accompanying presentation and our SEC filings for important risk factors.
Stephen Hoge: That could cause our actual performance and results to differ materially from those expressed or implied in these forward looking statements.
Stephane: I will now turn the call over to Stephane.
Stephane: Thank you lavina.
Stephane: Good afternoon, everyone. Thank.
Stephane: Thank you for joining us.
Speaker Change: Start with a review of 2020 for Jimmy we present, our financial results and outlook.
Stephane: Dan will review our clinical programs.
Stephane: And we then come back and shop key priorities for 2025 before we take your questions.
Stephane: The 20 mindful, we recorded revenue of $3 2 billion.
Stephane: You might recall to generate cost savings of $2 $6 billion, while 27% down from time to time before you.
Stephane: We reported a loss of three buckets begin to us.
Stephane: Thank you.
Stephane: Yes.
Stephane: Cash thanks to the team's work on Opex.
Stephane: Opex.
Stephane: Also working capital.
Stephane: Yes exactly.
Stephane: Cash and investments.
Stephane: Slide 24, we are now focused on high value programs.
Stephane: We expect approvals over the next few years.
Stephane: Driving sales growth.
Stephane: Diversification from a platinum chromium.
Stephane: Please go ahead.
Stephane: Throughout the way vaccine Nextgen covey combination from Prescott.
Stephane: Got it.
Stephane: Yes.
Stephane: In late November CMV and adenovirus the remedies.
Stephane: Maybe any help on RG <unk>.
Speaker Change: So Andrew that's melanoma.
Speaker Change: Is that the shift for graphics sales growth. The propagation of these programs will allow us to reduce R&D expenses in this timeframe.
Speaker Change: From a pipeline sandbox is wherever you are.
Speaker Change: Our strong progress in 2020.
We'd be Kevin Thank you product company.
Speaker Change: Yes.
Speaker Change: Bye bye.
Speaker Change: We now have two commercial products on the market.
Speaker Change: We reported positive phase III in fall voice breath of Remoxy program and refinery so FDA approval our next target.
Speaker Change: Our combination from Chris covered.
Speaker Change: If you are asking for group.
Speaker Change: Group today.
Speaker Change: And you'll see that our productivity is currently in a phase III efficacy trial.
Speaker Change: We also reported additional progress across our programs.
Speaker Change: One cool product Nomura EBV and <unk>.
Speaker Change: You don't want Rajiv, we presented data at major medical meetings in 2024.
Speaker Change: For IC program drew.
Speaker Change: We reported positive.
Speaker Change: Hey, Scott.
Speaker Change: Okay. Thank you.
Speaker Change: Sure.
Speaker Change: Vaccine and mountain a 40 briefly feedback we presented positive phase one data in September.
Speaker Change: We showed positive safety and clinical data from <unk>.
Speaker Change: With that I will elaborate on for.
Speaker Change: Jamie.
Speaker Change: Thanks, Stefan and Hello, everyone.
Speaker Change: Today, I will walk through our financial results for the fourth quarter and full year 2020 for providing insights into the key drivers behind our performance.
Speaker Change: I'll also outline our 2025 financial framework as we continue to optimize our operations and position the company for long term success.
Speaker Change: Let's begin by reviewing our commercial performance on slide eight.
Speaker Change: The fourth quarter of 2024 net product sales for zero point $9 billion.
Speaker Change: With zero point $2 billion in the United States, and <unk> 7 billion outside the United States.
Speaker Change: For the full year net product sales were $3 1 billion.
Speaker Change: The lower end of our revised guidance.
Speaker Change: You had sales of $1 7 billion for the year benefiting from a zero point $2 billion favorable adjustment.
Speaker Change: Weighted to a prior period return reserve reversals.
Speaker Change: Excluding this adjustment sales volumes saw a decline compared to last year.
Speaker Change: Merrily due to lower vaccination rates lower market share and increased competition.
Speaker Change: However, we observed signs of stabilization and believes the Colgate market will remain durable over time.
Speaker Change: Outside the U S product sales were $1 4 billion allow.
Speaker Change: Aligning with the midpoint of our guidance.
Speaker Change: This includes approximately $400 million from.
Speaker Change: From advanced purchase agreements that will not recur in 2025.
Speaker Change: The vast majority of our sales were from spec backs while.
Speaker Change: While we launched our second product in.
Speaker Change: In the third quarter sales were only $25 million for the full year.
Speaker Change: While early RSV sales were limited, we see long term opportunity to expand our presence in this market both in the U S and internationally.
Speaker Change: Moving on to slide nine I will now walk through our financial results for the fourth quarter of 2024.
Speaker Change: Total revenue for the fourth quarter was $966 million down 66% from the same period last year.
Speaker Change: As expected sales were impacted by the earlier launch of our updated Covid vaccine in the U S.
Speaker Change: FDA approval granted three weeks earlier than the prior year.
Speaker Change: This allowed us to meet demand sooner shifting a portion of sales into the third quarter.
Speaker Change: International sales were also lower year over year, reflecting the ongoing phase out of advanced purchase agreements.
Speaker Change: Cost of sales for the quarter was $739 million, including $45 million in third party royalties.
Speaker Change: $193 million in inventory write downs, and a non cash charge of $238 million.
Speaker Change: From the termination of a contract manufacturing agreement.
Speaker Change: The contract termination as part of our continued effort to optimize our manufacturing footprint. Following the strategic recycling initiatives launched in 2023 to align with the transition to a seasonal endemic market.
Speaker Change: While cost of sales declined by $190 million compared to the prior year lower product sales volume drove cost of sales to 79% of product sales, excluding the <unk> charge this would've been 53%.
Speaker Change: R&D expenses in Q4 were $1 1 billion.
Speaker Change: Reflecting a 20% year over year decline.
Speaker Change: The decrease was primarily driven by lower clinical development and manufacturing costs across our Covid RSV flu in combination.
Speaker Change: <unk> programs.
Speaker Change: This was partially offset by increased investments in our norovirus in Iot programs. Additionally.
Speaker Change: Additionally, last year's R&D expenses included $120 million upfront payment related to our collaboration with <unk>, which did not recur this year.
Speaker Change: SG&A expenses for the fourth quarter were $351 million down 25% year over year.
Speaker Change: The decrease was primarily driven by reductions in purchase services and external consultants as we continue to focus on cost management and operational efficiencies.
Speaker Change: We recognize that income tax benefit of $64 million in the fourth quarter similar to the prior year. The benefit was not material due to the global valuation allowance maintained against most of our deferred tax assets.
Net loss for the quarter was $1 1 billion.
Speaker Change: Compared to net income of $217 million in Q4 2023.
Speaker Change: Loss per share was $2 91 compared to earnings per share of <unk> 55 in the prior period.
Speaker Change: We ended the quarter with cash cash equivalents and investments totaling $9 5 billion.
Speaker Change: Up from $9 2 billion at the end of the third quarter.
Speaker Change: The increase was primarily due to accounts receivable collections.
Speaker Change: Now, let's turn to our full year 2020 for financial results on slide 10.
Speaker Change: Total revenue for the year was $3 2 billion or.
Speaker Change: 53% decline from 2023.
Speaker Change: Primarily driven by lower product sales, which I discussed on the prior page.
Speaker Change: Other revenue contributed $127 million for the year, reflecting grant revenue collaboration licensing and royalty revenue.
Speaker Change: Cost of sales for the full year 2024 was $1 5 billion.
Were 47% of net product sales.
Excluding the <unk> 2 billion noncash re sizing charge this would have been 39% and below our previous guidance of 40% to 45%.
Speaker Change: This represents a $3 2 billion decrease from 2023.
Speaker Change: Due to lower manufacturing recycling charges as well as lower inventory write downs and reduce unutilized manufacturing capacity costs, all of which reflect improved efficiency.
Speaker Change: R&D expenses for the year were $4 5 billion down 6% from 2023.
Speaker Change: The decrease was largely due to lower clinical trial and manufacturing costs as well as fewer upfront payments for collaboration agreement. We did however purchased two priority review vouchers during the year, which offset some of those savings.
Speaker Change: For the full year SG&A expenses totaled $1 2 billion.
Speaker Change: 24% decrease compared to 2023.
Speaker Change: The decrease reflects disciplined cost management across the organizations.
Speaker Change: We have continued to build capabilities and build bring more functions in house, allowing us to reduce reliance on external consultants, while improving operational efficiency.
Speaker Change: Additionally, these savings were supported by better leveraging digital technology and artificial intelligence to streamline operations.
Speaker Change: We recorded an income tax benefit of $46 million for the full year compared to an income tax expense of $772 million in 2023.
Speaker Change: The shift is mainly due to the global valuation allowance, we established last year on most of our deferred tax assets, which continues to impact our tax position.
Speaker Change: Net loss for the year was $3 6 billion compared to $4 7 billion in 2023.
Speaker Change: With a loss per share of $9 28, compared to $12 33 in the prior period.
Speaker Change: Moving to slide 11, we want to highlight the significant reduction in our operating expenses in 2024.
Speaker Change: On a GAAP basis cost declined $3 $9 billion from $11 1 billion to $7 2 billion.
Speaker Change: Excluding recycling charges of $1 6 billion.
Speaker Change: And zero point $2 billion for 2023 and 2024, respectively.
Speaker Change: We reduced operating expenses by $2 6 billion compared to 2023.
Speaker Change: Driven by manufacturing footprint re sizing pricing renegotiations, R&D prioritization volume reductions and a greater use of digital tools to improve efficiencies.
Speaker Change: Additionally, both 2023 and 2024 operating expenses included noncash costs of <unk> $9 billion and 0.6 billion respectively.
Speaker Change: Related to stock based compensation and depreciation and amortization.
Speaker Change: If you would exclude the manufacturing footprint resizing charges stock based compensation and depreciation our defined cash costs were $8 9 billion in 2023.
Speaker Change: $6 3 billion in 2024.
Speaker Change: Representing a year over year decline of $2 6 billion.
Speaker Change: To avoid double counting please note that in 2023, there was approximately $300 million of depreciation and amortization included in the one $6 billion of resizing charges.
Speaker Change: We are committed to drive additional cost efficiencies in 2025 and beyond by prioritizing investments to support the 10 product launches over the next three years.
Speaker Change: Our 2025 cap expenses are projected at $6 4 billion in 2025, which includes <unk> 9 billion of noncash charges for stock based compensation depreciation and amortization.
Speaker Change: Excluding those items, we project a cash cost of $5 5 billion.
Speaker Change: This represents an approximately $1 billion year over year reduction from our prior 2024 projection of $6 5 billion.
Speaker Change: We are also planning for an additional <unk> 5 billion of expense reduction in 2026, as we continue to drive efficiencies across all areas of the business.
Speaker Change: Now, let's turn to our financial framework for 2025.
Speaker Change: We expect total revenue in 2025 to be in the range of $1 5 billion to $2 5 billion.
Speaker Change: With first half sales of approximately 0.2 billion, reflecting the seasonality of our respiratory vaccine business.
Speaker Change: As discussed with investors in January.
Our wider guidance reflects the uncertainties in vaccination rates the competitive market environment. Besides of the RSV market and timing of licensure of our factories and product approvals in Australia, Canada and the U K.
Speaker Change: As a reminder, we filed three products to the FDA in 2024, and we are not including any new products revenue in our guidance range.
Speaker Change: Also with respect to revenue and R&D expense from our recently announced pandemic influenza program to be relatively immaterial in 2025 and is embedded in our guidance.
Speaker Change: Cost of sales is projected to be approximately $1 2 billion, reflecting continued improvements in manufacturing efficiency and lower expected inventory write offs offset by increased costs associated with the go live of our new manufacturing sites in Australia, Canada, and the U K.
Speaker Change: R&D expenses are anticipated to be approximately $4 1 billion.
Speaker Change: As we continue to invest in our late stage pipeline, while maintaining financial discipline.
Speaker Change: SG&A expenses are expected to be approximately $1 1 billion.
Speaker Change: Reflecting our continued focus on efficiency, while supporting our commercial execution.
Speaker Change: We expect taxes to be negligible in 2025.
Speaker Change: Capital expenditures.
Speaker Change: <unk> to be approximately zero point $4 billion.
Speaker Change: This increase from our prior guidance of <unk> 3 billion is primarily due to the timing of spend between 2024 and 2025.
Speaker Change: 2024, actual capital expenditures was approximately $150 million below our prior guidance.
Speaker Change: Some of that reduction was attributable to prioritization changes, but the majority of the impact was timing of spend between 2024 and 2025.
Speaker Change: We expect to end 2025, with approximately $6 billion in cash and investments.
Speaker Change: In summary, 2024, with a euro financial discipline, and we are well positioned as we enter 2025.
Speaker Change: We remain committed to managing costs, optimizing our operations and investing in our future growth with that I will now turn the call over to Steve.
Steve: Thank you, Jamie and good morning, or good afternoon, everyone slide.
Steve: Slide 15 shows the prioritized programs, we highlighted at our R&D day in September as Stefan mentioned earlier, we are focused on pursuing these 10 approvals over the next three years to drive growth.
Steve: Now filed for approval for three respiratory vaccines. Our next Gen Covid vaccine, our RSV vaccine for high risk Adults ages 18 to 59.
Steve: And our flu Covid combination vaccine for people, aged 50 and older.
Steve: Most of the other seven prioritize programs are in pivotal studies and the remainder are expected to begin their pivotal studies in the near future.
Steve: Slide 16 highlights the most recent updates from our late stage portfolio.
Steve: As a reminder, in September we presented positive efficacy and Immunogenicity data from our next Gen. Covid vaccine mrna 12 83.
Steve: We have since filed for approval in multiple jurisdictions and have a <unk> date of May 31 in the United States.
Steve: Also in September we shared positive phase III data for RSV vaccine and high risk adults ages 18 to 59.
Steve: This vaccine has also been filed for approval in multiple countries with a <unk> date of June 12 in the United States.
Steve: For our combination fluke Covid vaccine, we previously shared positive phase III, Immunogenicity and safety data and on the basis of that data we filed for approval at the end of last year in the United States and other countries.
Steve: We've previously demonstrated efficacy for the flu the cobot component of the vaccine demonstration of efficacy for the flu component may ultimately be required for approval.
Steve: To that end, our Standalone flu vaccine mrna 10 10 is currently in a phase III efficacy study that is accruing cases rapidly.
Steve: Based on the current pace of case accrual we are optimistic that we will be able to conduct the first analysis of efficacy for our flu vaccine at the end of the currency.
Steve: Now turning to our non respiratory portfolio star.
Steve: Starting with our lean and other virus vaccines.
Steve: For our CMV vaccine, we announced last month that the data and safety monitoring board informed us that the early efficacy criteria was not met and recommended the study continue to its final analysis.
Steve: We remain blinded to the study and continue to expect the results for the final analysis later this year.
Steve: Our norovirus vaccine phase III study is fully enrolled in the northern hemisphere, and we are preparing to enroll participants for the upcoming southern hemisphere season.
Steve: The trial is currently on FDA clinical hold in the U S. Following a single case of Guillain Barre syndrome, which remains under investigation.
Steve: Given that enrollment had already completed for this season, we do not currently expect any impact on timelines, while we complete the investigation and update trial documents with this information.
Steve: In oncology, we and our partner Merck have multiple late stage studies underway evaluating <unk> T or mrna $41 57 in combination with Keytruda.
Steve: First of which adjuvant melanoma as part of our Kern prioritize program the phase the phase III for this is now fully enrolled.
Steve: Two additional phase III studies are underway in non small cell lung cancer.
Steve: And there are two randomized phase II trials ongoing in high risk muscle invasive bladder cancer and adjuvant renal cell carcinoma.
Steve: In rare diseases propionic acid EMEA for Pn in its Registrational study.
Steve: And metal Milan, and Cassidy near for M&A, We haven't presented we have agreed with FDA on our pivotal study design and expect to start that study in 2025.
Steve: With that I'll now hand, it back to justify it.
Speaker Change: Steven and Jamie for 2025, we have three priorities priority one <unk> sales of approved products.
Speaker Change: Priority two is to focus on our late stage pipeline, where we believe we have up to 10 product approvals over the next four years.
Which will drive sales growth and diversification.
Speaker Change: Our active free delivery cost efficiency across the business, let me take you through each of reviews.
Speaker Change: First parties would review those buybacks and manage their vaccines.
Speaker Change: Importantly, we entered 2025 with two approved products, which gives us a better competitive positioning.
Speaker Change: We entered 2024.
Speaker Change: We have posted on Cogs per unit, we expect to better compete in the respiratory vaccine market in.
Speaker Change: In addition.
Speaker Change: Coming outside.
Speaker Change: Outside the U S to add to sales in 2025.
Speaker Change: Two we are focused on delivering a protest lockups approval over next Korea, which we believe will drive sales growth.
Speaker Change: Okay.
Speaker Change: The fact expecting products target the total addressable market of over.
Speaker Change: TV go App.
Speaker Change: Proxy free delivery cost efficiency across the business.
Speaker Change: We've demonstrated our commitment to cost savings.
Speaker Change: $2 6 billion there are cost reductions we made in 2024.
Speaker Change: We continue to focus on improving efficiency by reducing cost across the entire company.
Speaker Change: Manufacturing.
Speaker Change: <unk>.
Speaker Change: And of course SG&A in 'twenty.
Speaker Change: Great.
Speaker Change: But they are fully funded by <unk>.
Speaker Change: For efficiency program, we're reducing cash cost to an estimated $5 5 billion in 2025 and $5 million entering 2000.
Speaker Change: Six.
Speaker Change: This brings our total cash costs with exempt was or whatever because on our own.
Speaker Change: At least we are from a $6 3 billion in 2024.
Speaker Change: We will continue to address our cost structure to ensure we breakeven on the cash cost basis, no later than 2028.
Speaker Change: Yes.
Speaker Change: Can be very severe.
Speaker Change: If needed.
Speaker Change: You saw construction method.
Speaker Change: Customer all sales objective.
Speaker Change: <unk>.
Speaker Change: Format of a mortgage product.
Speaker Change: Program milestones.
Speaker Change: We filed three units.
Speaker Change: We look forward to having the final results of our phase III study in 2025.
Speaker Change: Norovirus vaccine phase III studies in terms of they thought we thought we'd be sophisticated accrual.
Speaker Change: Okay.
Speaker Change: Mike.
Speaker Change: We were so vis a vis vis vis accrual.
Speaker Change: We're already generating data from a Registrational study and we expect to stop Richardson certified by mid this year.
Speaker Change: We will continue to focus on delivering the greatest possible impact to Green mountain.
Speaker Change: Our portfolio of products and pipeline upwards somewhere two approved products <unk> and six phase III pivotal studies ongoing for <unk>.
Speaker Change: R&D platform is working.
Speaker Change: We demonstrated progress with our cost reduction program, we assume that with the financial discipline to achieve our growth and fulfill our mission with this operator, we'd be happy to take questions.
Speaker Change: Thank you again, ladies and gentlemen, if you have a question or a comment at this time. Please press star one on your telephone. If your question has been answered you were seeing with yourself from the queue. Please press star one again and we also ask that you limit yourself to one question, we will pause for a moment, while we compile the Q&A roster.
Speaker Change: Yeah.
Speaker Change: Our first question comes from Ellie Merle with UBS. Your line is open.
Ellie Merle: Hey, guys. Thank you for taking the question.
Speaker Change: Can you help us understand that.
Speaker Change: Take down of the R&D spend.
Speaker Change: Ross Your program. So if you needed to or wanted to reduce R&D spend further how much flexibility is there on the expense structure. Their first day further cuts in the 2026 timeframe and then just a second question on the <unk>.
Speaker Change: Clinical hold on norovirus can you give any more detail around sort of best.
Speaker Change: Why one case of GBS prompted the clinical hub.
Speaker Change: Any more color surrounding the situation there would be helpful. Thanks.
Speaker Change: Yes, thanks for the questions maybe I'll address the first one on R&D. So we still think there's a lot of room to be reduced and a lot of flexibility. So as a reminder, we're guiding $4 1 billion for 2025 and at R&D Day, We said we would.
Speaker Change: Take it down by $1 $1 billion from the $4 $8 billion level by 2027. So that suggests a number of about three six to $3 7 billion.
Speaker Change: To answer your question on what we're spending on Thats still back primarily over 50% of our trials span and therefore overhead is related to respiratory trials, which as you know we expect to roll off over this year and the following year.
Speaker Change: And then the only other phase III trials that we've started our in latent disease in oncology for norovirus, and CMV and <unk> and we expect those to be reduced over the coming years as well so.
Speaker Change: We expect that there will be some flexibility beyond the $3 6 billion that we've already indicated but right now we're still monitoring the sales line, but that is an area that we could continue to reduce if need be.
Speaker Change: And thank you for the second question I'll take it.
Speaker Change: So just a little bit of context.
Speaker Change: As you alluded to.
Speaker Change: GBS does happen obviously in the background population.
Speaker Change: It's usually seen in older adults about one to two per 100000 participants per year or people per year.
Speaker Change: And given we've enrolled well over 250000 participants in studies over the last couple of years it wouldn't be surprising to see cases in our clinical trials as you suggested.
Speaker Change: Although that hasnt been associated.
Speaker Change: As a risk factor with our approved vaccines.
Speaker Change: Something that does happen.
Speaker Change: As it relates to this case when we identify it.
Speaker Change: We proactively decided to pause our activities and update our study documents, because we prioritize patient safety and obviously transparency first and foremost and we wanted to make sure that all of that information was shared as soon as the case emerged.
Speaker Change: We submitted those for review with regulators globally and the FDA has placed us on a clinical hold while they review that information in those documents.
Speaker Change: Perhaps most importantly for study conduct because we had enrolled and dosed everybody prior to the emergence of this case in the current season study, we really don't expect there to be any impact on the conduct of the study or at the timelines for readout on efficacy, which will ultimately be case driven.
Speaker Change: From our side. This is just about being prudent and transparent and making sure that we're prioritizing patient safety.
Speaker Change: Understood. Thank you.
Gena Wang: Our next question comes from Gena Wang with Barclays. Your line is open.
Gena Wang: Thank you maybe I'll just follow up on the neuro virus.
Speaker Change: We would take for the SBA to remove.
Gena Wang: The clinical hold.
Speaker Change: All of that outcome.
Speaker Change: Okay and then another question.
Speaker Change: Regarding the CFO now.
<unk> events.
Speaker Change: We will still happen in the first half 'twenty five should we see the final readout.
Speaker Change: So.
Speaker Change: It broke for just a second could you repeat the CMV portion of the question.
Speaker Change: Sure CMV.
Speaker Change: Since now we see additional months of events cooling.
Should we still be able to see.
Speaker Change: Final readout in the first half 'twenty five.
Speaker Change: So.
Speaker Change: Thank you.
Speaker Change: I think at first.
Speaker Change: So yes, we continue to accrue cases in the CMV trial as I said, we remain blinded to the interim analysis. We still do expect that result in 2025, I don't know that we've guided to the specific timing, but we still do expect to result in 25.
Speaker Change: As it relates to norovirus click.
Speaker Change: Clinical hold.
Speaker Change: I think the FDA need the time to review the materials, we've submitted they may come back with some questions. If they do we'll answer those.
Speaker Change: But as has been suggested even the question.
Speaker Change: The case of GBS is not necessarily unexpected and because.
Speaker Change: Because we've updated the documents, we really do expect there to be minimal impact on trial conduct at this point, but.
Speaker Change: It will be ultimately up to the agency what they need to see before we move forward with further enrollment in that study.
Speaker Change: Thank you.
Speaker Change: Our next question comes from Michael Yee with Jefferies. Your line is open.
Speaker Change: Hi, Thanks, good morning.
Speaker Change: We had two timing questions.
Speaker Change: For you guys first on the <unk> cancer vaccine, which of course is a really exciting product.
Speaker Change: I think previously you've done some math on the phase two.
Speaker Change: Certainly possible on the event rates that <unk> seen in phase II that the data could come by end of year or first half of 2006 and the company has not totally.
Speaker Change: Weighted us or others from that type of timing do you generally agree with that timing and can you shed some light on how to think about the powering for the anti cancer vaccine.
Speaker Change: Primary endpoint and then similarly with the Norovirus I think you mentioned that you are enrolling.
Speaker Change: Southern hemisphere, but completed the northern do you need both to hit the primary or the hit the event rate and just.
Speaker Change: Help us understand the timing of that despite the fact that it's on hold the northern which already completed enrollment. Thank you.
Speaker Change: Thanks for the question. So so first on IMT.
Speaker Change: There are some differences between the study population between the phase II and the phase III.
Speaker Change: So.
Speaker Change: We will want to be guided by the actual event accrual a case accrual rate of relapse rate in the phase III study before we feel confident that we could offer a timing on that.
Speaker Change: And so as we have started to accrue cases, Australia. As you know is fully enrolled so there are going to be events that start to happen.
Speaker Change: We will have a better sense of that certainly 2000 2000 sixteens.
Speaker Change: <unk> plausible, but whether or not it could be on the early side of that are the right side of that we just don't know at this point it is event driven.
Speaker Change: And so more as we have information in the future.
Speaker Change: On the question of Norbert. So we have we fully enrolled and fully dosed the northern Hemisphere study, which is the majority of the study, but given epidemiology. We also wanted to.
Speaker Change: And will some participants in southern hemisphere geographies.
Speaker Change: At the end of the day.
Speaker Change: We will also be case, driven so you ultimately the cases of norovirus towards that efficacy endpoint because the majority.
Speaker Change: Sizable majority of studies is completely enrolled now thats Northern hemisphere is completely enrolled which is the majority of the participants. We intended it is possible that we won't need southern hemisphere participants, but we do intend to ignore southern hemisphere for Q1.
Speaker Change: Broader epidemiology towards that final endpoint.
Speaker Change: So again, we don't know when that will happen we do currently hope.
Speaker Change: That we are sufficiently powered in this season to see efficacy, but it's more participants are needed and of course, we will enroll them to accrue more cases towards that efficacy endpoint.
Speaker Change: Thank you guys.
Speaker Change: Our next question comes from solving director with Goldman Sachs. Your line is open.
Speaker Change: Good morning, Thanks for taking my question could you help us understand what the clinical bar is for the Norovirus program and then on the IMT portfolio will we get any data or just enrollment updates for the program beyond melanoma. Thank you.
Speaker Change: Sure.
Speaker Change: On the clinical bar for Norovirus obviously.
Speaker Change: There are other.
Speaker Change: Vaccines out there for <unk>.
Speaker Change: Gastrointestinal infections.
Speaker Change: The virus and others.
Speaker Change: Where we will want to show a meaningful decrease in the rate of.
Speaker Change: Moderate to severe gastrointestinal symptoms those are really where the burden of disease happens, particularly in higher risk populations like older adults are immune compromised.
Speaker Change: We will look at a pretty broad range of endpoints as secondary and exploratory endpoints as well as things like hospitalization utilization of health care services.
We have not disclosed our target product profile for that yet or the or the powering assumptions. We have in those interim analyses and so I won't do that here, but we will perhaps in the future provide an update on that but we will be looking for a meaningful reduction in the rate of moderate to severe.
Speaker Change: <unk> gastroenteritis.
Speaker Change: As for IMT, obviously, we're all looking forward to the melanoma adjuvant melanoma phase III readout.
Speaker Change: As you know and as I mentioned, there are an additional phase III as well as two randomized phase twos, including bladder cancer renal cell carcinoma, which dip.
Speaker Change: Depending on the rate of accrual of events could have readouts.
Speaker Change: We will be updating on as well in the coming years.
Speaker Change: Okay.
Speaker Change: Thank you. Our next question comes from Terence Flynn with Morgan Stanley. Your line is open.
Terence Flynn: Hi, Thanks for taking the question maybe a two part for me.
Terence Flynn: Wondering if you can confirm if you still have not seen any cases of GBS with your RSV vaccine.
Terence Flynn: Then I know you filed for approval for the Covid flu combo vaccine and it sounds like now youre waiting for some vaccine efficacy data can you tell us anything more there about.
Terence Flynn: What the bar is that only on the flu side or do you need vaccine efficacy for both COVID-19 as well.
Kind of what level of <unk>.
Protection you need to see thank you.
Terence Flynn: Thanks for those questions.
Terence Flynn: So first I can confirm that GBS has not yet has not been identified as a risk factor for our RSV vaccine or our COVID-19 vaccines buybacks to date.
Terence Flynn: And so.
Terence Flynn: Obviously, we'll continue to track that closely but thats encouraging.
Terence Flynn: On the <unk>.
Terence Flynn: <unk> study so we have demonstrated efficacy for the Covid component as you May remember mrna 12, 83 had a successful efficacy study.
Terence Flynn: In that we announced last year and that is the COVID-19 component of the combination vaccine instead to satisfy that requirement.
Terence Flynn: As for the flu vaccine, we have had multiple phase III readouts in our flu vaccine as well as for the combo vaccine demonstrating.
Terence Flynn: Non inferior or superior Immunogenicity and safety.
Terence Flynn: Safety profile for this I think but we have not yet demonstrated efficacy for the flu component of that vaccine.
Terence Flynn: That trial as I mentioned is is actually ongoing right now and given that it is.
Terence Flynn: A robust flu season coming northern hemisphere, as many folks know and given the case accrual rate. We see there. We do expect that we'll we're actually quite optimistic we'll be able to conduct the first interim analysis of efficacy at the end of this current season and so that would then be the demonstration of efficacy for the flu component of the complex.
Terence Flynn: Sure.
Terence Flynn: Okay.
Speaker Change: Thank you. Our next question comes from Tyler Van Buren with TD Cowen Your line is open.
Speaker Change: Hey, guys. Thanks for the update and for taking the question regarding CMV just to confirm even though the criterion for early efficacy was not met at the interim is it still possible that a higher vaccine efficacy threshold from a first interim could still be reached with the final analysis due to a wide confidence interval with fewer patients at the time of day.
Speaker Change: <unk> review or do you think that's less likely.
Speaker Change: Thanks for the question so.
Speaker Change: Yes.
Speaker Change: Yeah.
Speaker Change: If you look at the tower that we had at that first interim analysis.
Speaker Change: Actually it was intended as a as an early look but but not sufficiently power that you would have high compound fitbit was in between efficacy.
Speaker Change: And for that reason it is still very much possible that at the final analysis with many more cases, the confidence intervals narrow and what we see as a point estimate for efficacy that is.
Speaker Change: Favorable from our perspective meets or exceeds our expectations for the charter backlog.
Speaker Change: The most important thing to say, though that we remain completely blind to this all we know is that the confidence interval did not exclude the lower bound target.
Speaker Change: And given the powering of the study.
Speaker Change: For that interim analysis does not necessarily surprising stopping for early efficacy early criteria and would have been upside scenario.
Speaker Change: Our view.
Speaker Change: We remain blinded, we will accrue the full number of cases.
Speaker Change: We continue doing that in that study and then we will look to that final analysis, which is actually the fully powered analysis for assessing against our our target product profile.
Speaker Change: Okay.
Speaker Change: Thank you. Our next question comes from Luca <unk> with RBC capital. Your line is open.
Luca: Oh, great. Thanks, so much for taking my question maybe Stefan.
Sure. We all know that you have worked very closely with the Trump administration during the pandemic.
Speaker Change: Talk to either the precedent RFK your any of their represents this time around.
Speaker Change: So what has been the message that you have been hearing from them I think any color there would be much appreciate it and then maybe secondly, Stephen on Norovirus can you just talk about the timing of the GBS case.
Speaker Change: The curse soon after individuals receive the vaccine or maybe many months after that I'm just trying to understand.
Speaker Change: Correlation versus causation here, so any color much appreciate it thanks so much.
Speaker Change: Thank you for the question. So as you know we work productivity.
Speaker Change: The Trump administration and the President Trump's first.
Speaker Change: Monday and.
Speaker Change: We look forward to working with the new team as it get confirmed by the Senate.
Speaker Change: And depending on barrels.
Speaker Change: Vaccine, a very important piece of keeping people healthy and we look forward to leverage those discussions basketball to be fulfilled.
Speaker Change: Yes.
Speaker Change: As the norovirus cases.
Speaker Change: We will note we've enrolled about 20000 participants in that study and just the last couple of months. It's all been relatively rapid enrollment for the current norovirus season for that reason you can imagine.
Speaker Change: It's relatively proximal which is why we are.
Speaker Change: Being cautious and communicating around it.
Speaker Change: First and foremost with participants investigators and regulators just as they have that information now to the point of.
Speaker Change: Correlation versus causation and it is important to note that in this case there.
Speaker Change: These extremely rare events that do happen.
Speaker Change: It's very hard.
Speaker Change: Two finally determined closer relationship and so other than reporting it that had happened around this time and investigating it thoroughly and communicating around it.
Speaker Change: We may never have unanswered beyond that.
Speaker Change: Yes with respect for the.
Speaker Change: Confidentiality for that participant and more generally.
Speaker Change: I don't think I would offer any more information about it other than we continue to investigate it and see.
Speaker Change: What the potential causes would be.
Speaker Change: Got it thanks, so much.
Our next question comes from Corey.
Speaker Change: Evercore ISI your line is open.
Speaker Change: Hi, This is Eddie on for Corey.
Speaker Change: I wanted to ask on what possible changes have you seen in the past months that has caused the bump to expense guidance already.
Speaker Change: Okay two expense guidance study.
Speaker Change: The increase in R&D and SG&A spend.
Speaker Change: I think Joe I don't know if it's a bit confusing. So we've been basically you're talking about two different sets of numbers. Neither have changed one is our GAAP cost Sadie and one which includes stock based compensation and depreciation and amortization. So maybe that's what you're referring to versus what we define as cash costs, which exclude those two numbers which happened.
Speaker Change: What changed and as a reminder, those numbers were closer to $9 billion. In 2023. They had we had $6 $3 billion in 2024, we're guiding to $5 $5 billion in 2025 and $5 billion. In 2026. So perhaps you are looking at the GAAP inclusion, but we have not changed any estimates.
Speaker Change: From a cross border.
And I have just one more follow up if you can provide any more color on the language of D. A.
Speaker Change: Oh.
Speaker Change: Program.
Speaker Change: The PR.
Speaker Change: J P M on today's P I suggest.
Speaker Change: Potentially.
Speaker Change: MD Eastern Quincy wanted just some additional color on it.
Speaker Change: Yeah. Thank you for that so.
Speaker Change: As we had previously disclosed from our ongoing clinical trial. There we have seen a significant a substantial decrease in the rates of metabolic decompensation events in that.
Propionic acid in their study.
Speaker Change: And we believe and ultimately have agreed with regulators that that is the endpoint that we will assess for the pivotal part of that study.
Speaker Change: <unk> moved forward.
Speaker Change: To that pivotal phase so what we'll be looking at is the rates of metabolic decompensation or Mds for participants prior to being on drug versus once they start treatment with that medicine.
Speaker Change: That rate.
Speaker Change: The reduction in it will ultimately be we believe the pivotal endpoint that would support registration for the drug for Ta and so as we move forward.
Speaker Change: With new participants.
Speaker Change: As well as some older other participant person who are already on the study we'll be looking at that comparison on reduction in the rates of Mds.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Thank you. Our next question comes from Courtney <unk> with Bernstein. Your line is open.
Speaker Change: And that's it. Thank you so much for taking the call today and taking the question today.
Courtney: I wanted to kind of pivot a little bit to some of the cost as well and specifically the inventory write downs.
Courtney: I think they continue to be an issue with the kind of seasonal vaccines, we have to produce in advance and then say the season play out.
Courtney: I would love to understand a little bit more about what the future looks like in this space you are going to continue to be in a seasonal market.
Speaker Change: Covid no.
Speaker Change: And with.
Speaker Change: With RSV and so as we think about projecting and manufacturing appropriately to minimize those write downs, but maximize the opportunity.
Speaker Change: Just could look like number one kind of what is the goal in terms of.
Speaker Change: Limited inventory write downs and number two kind of what are the one of the things that you're changing to kind of continue to improve your ability to.
Speaker Change: To the right amount.
Speaker Change: Yes. Thanks for the question, it's a great one so as you know and maybe just to step back.
Speaker Change: 2023, I forget what the numbers are but we reduced this dramatically already but nonetheless, we did have $500 million of inventory write downs in 2024.
Speaker Change: And about $100 million of Unutilized.
Speaker Change: Manufacturing capacity and so at $6.600 billion and $3 billion of sales that is obviously not what good looks like yet.
Speaker Change: What I will say is much of this is related to our raw materials, where we take inventory reserve based on future demand and if you look at our inventory levels now Courtney we are under $300 million I think $270 million. So the go forward should look much better as we project moving forward on the raw.
Speaker Change: Cereal side on.
Speaker Change: On the excess capacity side Youre right, we still have a fair amount of either write offs of good product that we produce because we produced last year. For example, we assumed $4 billion in sales when we came in at 3 billion. So we obviously overproduced.
Speaker Change: And we are still going to produce to the higher end.
Speaker Change: Our guidance range of one 5% to $2 5 billion, which is why you see a cost of sales in the neighborhood of 50%.
Speaker Change: But as we get better at what we're working on is matching what does that future demand look like and what is the supply that we should account for as an example of we used to as we've continued to adjust for that that since the example of the termination of a contract manufacturing agreement that we had in the fourth quarter. So we continue to be proactive about what is that future demand what is it.
Speaker Change: The capacity, we require and you should see that come down and certainly $600 million and $3 billion is that what we expect we want that to be.
Speaker Change: Less than 10%, let's say over time, but I'm, not saying that that will happen in the year 2025, but it will get better also because our inventory balances down dramatically.
Speaker Change: Thank you.
Speaker Change: Our next question comes from Edward <unk> with Piper Sandler Your line is open.
Speaker Change: Great. Thank you very much.
Speaker Change: Questions have been answered, but I think I saw some news maybe on the vertex CF program and I was wondering if you could just kind of give us an update on what's going on there with that rare disease program.
Speaker Change: Yes. So thank you for the question Ted So we continue with our partner vertex.
Speaker Change: Who is conducting that clinical trial so.
Speaker Change: The sponsors for the study and have the.
Speaker Change: The most information on it but we continue down the path. We've completed the single ascending dose portion of that trial and are now in the multiple ascending dose portion of that trial.
Speaker Change: That is patients receiving treatment regularly.
Speaker Change: Two ultimately measure whether or not we are having an effect on our respiratory measures and hopefully overall.
Speaker Change: Addressing the burden of CF in those patients that can't take the small molecule corrector.
Speaker Change: We do expect a readout from that multiple ascending dose trial I think vertex previously guided that we expect that this year and we will look for them to provide further updates on that kind of thing if they happen.
Speaker Change: Great. Thanks, Steven.
Speaker Change: Our next question comes from Jessica Fye with Jpmorgan. Your line is open.
Jessica Fye: Hey, guys. Good morning, Thanks for taking my questions I had a few follow ups for Stephen just from a prior question I was hoping to clarify the response on.
Speaker Change: Norovirus, how confident are you that the trial will not the longtime equivalent of clinical hold in the southern hemisphere.
Speaker Change: <unk> global regulators confirm they did not need a pause to review the information or is there a chance stoppage there.
Speaker Change: <unk> just following up on <unk> question I think in the past you had said the final CMV analysis could come near months after the interim which we heard about in January.
Speaker Change: So should we still think of that as the first half of 'twenty five or can you clarify the prior answer.
Speaker Change: And then on the <unk> III <unk> filing I think the press release that approval may require a vaccine efficacy data from the phase III trial Ly.
Speaker Change: Why is that a point of uncertainty that the FDA may require it has been up and clear with you and your pre submission meeting.
Speaker Change: And then lastly for Jamie can you recap what variables and the equivalent vaccine and RSC markets with land you at the low end or the high end of your 25 guidance.
Speaker Change: Like price vaccination rates market share stuff like that thank you.
Speaker Change: So lots of there for me. So I'll go first and then kick it to Jamie So first on the northern Hemisphere Norovirus study.
Speaker Change: As we said we will look to enroll the second season in southern Hemisphere.
Speaker Change: We do not expect any delays in doing that given that we have enrolled over 20000 participants in that study already in the northern hemisphere.
Speaker Change: If there were any delays were not sure that it would have an impact a study timeline, but at this point.
Speaker Change: Whereas companies we can be.
Speaker Change: The that there won't be any enjoys in southern hemisphere as relates to CMV on case accrual.
Speaker Change: The second half we have previously said that case approval was moving relatively quickly. It continues to accrue steadily in the study.
Speaker Change: Ultimately, it's an event driven analysis, so we can't necessarily predict the timeline, but we'd previously.
Speaker Change: <unk> that we expected it perhaps mid 2025, we're not changing that here.
Speaker Change: Continue to believe that that's possible.
Speaker Change: And ultimately again it will depend upon the rate of case growth, which we don't control.
Speaker Change: As it relates to 10 83.
Speaker Change: So for the flu Colgate product.
When.
Speaker Change: When we submitted the package.
Speaker Change: And as part of our initial exchange with regulators.
Speaker Change: We are identifying review questions that they have or issues.
Speaker Change: Yes.
Speaker Change: As we said in our press release.
Speaker Change: Some cases, the proximity of the flu efficacy readout.
Speaker Change: Really does loom large on the overall review for the combination product and we will be.
Speaker Change: We do expect that that may be necessary in some cases now that that flew efficacy readout is expected shortly.
Speaker Change: As it relates to individual conversations with individual regulators I'll say, we're working through their review questions in that submission.
Otherwise comment on the specific back and forth.
Speaker Change: And with that I guess I'll turn it over you can say.
Speaker Change: So thanks, Jeff Yes, two as a reminder, on the high end to $2 5 billion. If you exclude the unusual as we saw in 2024, we called out essentially flat.
Speaker Change: My prepared remarks, the U S came in at $1 $7 billion. It had a $200 million returned reversal adjustment from the prior year, which would take that to about a one $5 billion number.
Speaker Change: And then outside the United States, we were at $1 $4 billion, and we said that there was about $400 million of advance purchase agreements that the demand level, we do not anticipate repeating so the high end is essentially flat Jess.
Speaker Change: So you can anticipate both inside the U S and outside the U S. Similar market share vaccination rates, we do have a little bit of uptick in RSV and the high end, but it's all together rather minimal in general.
Speaker Change: On the low end it basically assumes no increase in RSV.
Speaker Change: In the U S. You would have to expect it to go down substantially so.
Speaker Change: You'd have to expect it to go down.
5% to 10%, it's a market share perspective vaccination rates would have to go down again, 7% to 10% both of those things would have to happen to go down, let's say a $5 billion.
Speaker Change: And then really the biggest factor outside the United States R&D, the licensure timing of our plants in the U K, Canada and Australia.
Speaker Change: Should those be licensed and registered on time, we will be on the upper end, but if they are delayed we have.
Speaker Change: Factored that into the lower end of our guidance.
Speaker Change: Very helpful. Thanks.
Simon Baker: Our next question comes from Simon Baker with Redburn. Your line is open.
Simon Baker: Thank you for taking my question.
Speaker Change: A clarification, Jamie you mentioned the spend on respiratory trials being 50%, 60% of your total trial spending 50% of your R&D spend.
Simon Baker: And then just another question on that.
Speaker Change: The flu combo following up on Jessica's question.
Simon Baker: Just as the mechanism.
And the timing.
Simon Baker: Which point the regulators could also have an extra day to assist someday.
Simon Baker: Could come at any time.
Simon Baker: If it happens sooner rather than later do you think you would have an impact on.
Simon Baker: The approval timeline and is there any risks in the U S.
The initial funding gets a complete response and then you have to refile with that kind of appetite for any color on the machinations of that'd be very handy. Thank you.
Speaker Change: Yeah. Thanks, Anthony on the first one.
Speaker Change: I'd say, 50% of the trial expense, which is why we break out in our 10-K. There are other line items that hit RMB in terms of the overhead that supports it people.
Speaker Change: <unk> et cetera in our manufacturing facilities.
Speaker Change: As well as research, but the 50% that I was referencing is really trial related but you could imagine many of those other costs are also related therefore to the respiratory trials as well.
Speaker Change: Yes, Thank you and so for the clarifying question again.
Speaker Change: We have filed in multiple geographies.
Speaker Change: I won't comment on individual regulatory exchanges, but generally speaking.
Speaker Change: We.
Speaker Change: As a part of the initial round of questions and feedback that we're receiving.
Speaker Change: There are instances, where we think.
Speaker Change: We will be dependent upon that efficacy data from the 10 10 study, which we do expect in the coming months the current season.
Speaker Change: To be available.
Speaker Change: The timing of that readout and the impact on the review process for regulators is not something I can predict at this point, but we are in active discussion with regulators about it certainly it is possible that if that is substantially delayed or if it is not a favorable efficacy readout that it could for sure delay or impact.
Speaker Change: Our timeline for approval for the combination product.
Speaker Change: If we are able to complete that submission and get that data to regulators and able to conduct that review it's possible that we continue with that.
Without substantial delay ultimately we don't know at this point.
Speaker Change: Because it will depend upon.
Speaker Change: Those submissions and discussions with regulators that we're having right now, but we did want to flag that we do think based on some of the initial conversations that we may be dependent upon that data ultimately for approval with some in some geographies.
Speaker Change: Alright, that's very helpful. Thank you.
Speaker Change: Our next question comes from Myles Minter with William Blair. Your line is open.
Speaker Change: Hi, Thanks for taking the question just one on the potential ACF recommendation reviews for RSV vaccines do you expect that here in the Bay in February or the June meeting and is there anything built into the top end of that $2 5 billion revenue guidance frame reservoir that would require a widening.
Speaker Change: That recommendation that economy stance, thanks very much.
Speaker Change: Okay.
Speaker Change: So I'll take the first the question on timing.
We are obviously working closely with public health officials on the widening we've filed for approval for the 18 to 59 high risk population at this point, we are not yet approved.
Speaker Change: And so from a broader sort of.
Speaker Change: Engagement with ACP perspective, we'll wait for approval before we.
Speaker Change: Do that too broadly, we do expect that the benefit risk is favorable for RSV vaccines, including <unk> and <unk>.
Speaker Change: We do look forward to <unk>.
Speaker Change: Expansion of the recommendation to cover high risk populations.
Speaker Change: Both the $50 to 59, which had previously been discussed, but ultimately hopefully 18, plus high risk populations and Jamie I don't know.
Speaker Change: Yes, so miles as I mentioned in just this question, we have a little bit of growth in RSV.
Speaker Change: I also mentioned that we have nothing related to new product approvals and our guidance for 2025. So that doesn't include the nextgen COVID-19 vaccine or what Stephen just talked about about the expanded indication related to RSV or anything from a combination of approval should it happened.
Speaker Change: Okay.
Speaker Change: Alright. Thanks.
Speaker Change: Our next question comes from Tim Anderson with Bank of America. Your line is open your line is open.
Tim Anderson: Thank you.
Tim Anderson: If I could just go back to that very last point on your 2022 revenue guidance youre, not including any new products.
Tim Anderson: Makes sense for RSV, because that would be tiny makes sense for the combo product because of the reasons that you've outlined but why wouldn't the nextgen COVID-19 product.
Tim Anderson: Be included in guidance at this point given that the <unk> date.
Tim Anderson: It's not very far away end of May.
Tim Anderson: Well characterized paradigm, having COVID-19 vaccines out there I'm just wondering if that.
Tim Anderson: That lack of inclusion guidance anticipates, some uncertainty about approval.
Tim Anderson: Given the new administration coming in and the common thread of kind of an anti COVID-19 staffs across lots of people from the Trump administration.
Tim Anderson: And then second question on Norovirus, if you're fully enrolled what does SBA gain by putting the program on clinical hold.
Tim Anderson: That just a forest disclosure of that adverse event to the clinical and patient community or is there. Some other reason why they would do this.
Yeah, Tim Thanks for the question, maybe I'll take the first one so I don't think theres much to read into here I think we've learned our lesson coming into 2024 in terms of guiding with a product that is yet to be approved so moving forward. We have eliminated any products of course, there could be upside.
Tim Anderson: I think we approach our guidance understanding that there is variability and therefore, we will not put the any revenue related to the nextgen COVID-19 or any of the other two products as well and again I don't think there's anything else to read into as a result of that.
Tim Anderson: Yes. So another question on Norovirus importantly, we have already proactively communicated around this to all the investigators and IRB and regulators around the world. So that communications happened and actually we've updated all the documents that would be necessary to sort of broadly identify this.
Tim Anderson: The purpose for the clinical hold.
Tim Anderson: Ultimately you have to.
Tim Anderson: Agreed.
Tim Anderson: I anticipate our at the FDA that question I mean at this point on there they are appropriately and we think prudently and conservatively reviewing the documents and making sure that theyre all of their questions are answered around this.
Tim Anderson: It does not impact from our perspective right now in the Northern Hemisphere study conduct.
Tim Anderson: So.
Tim Anderson: We'll look forward to engaging with them answering those questions hopefully completing that review that we're moving that whole, but as we said we will not then reinitiate any enrollment because we now have 20000 participants in the northern hemisphere, which is more than we feel like we need and so we'll just answer those questions and before but I really couldnt offer any other insight around it but it certainly isn't around.
Tim Anderson: And transparency of communication, because that'll happen proactively.
Tim Anderson: We did that before as we submitted all the information to them.
Tim Anderson: Yeah.
Speaker Change: Thank you ladies and gentlemen, this does conclude the Q&A portion of today's conference I'd like to turn the call back to Stefan for any closing remarks.
Speaker Change: Thank you very much everybody for joining us and for your good questions have a great day, and we look forward to speaking to some of you in the next house and in the next days ladies.
Speaker Change: Ladies and gentlemen, this does conclude today's presentation. You may now disconnect and have a wonderful day.
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