Q1 2025 Novavax Inc Earnings Call
Speaker Change: and Geoff Washington are part of the APTA Brochure for women's sports. Asking for the Top 10 10ng women's sports and gamesrestrially compatible of all brands.
Speaker Change: Good morning and welcome to Novavax's first quarter, 2025 Financial Results and Operational Highlights Conference Call.
Speaker Change: All participants will be in English and only mode. Should you do it, assistance please sign a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions.
Speaker Change: As a question, you may press star followed by the number one on your touch tone phone. To withdraw your question, please press star followed by the number two. Please note, this event is being recorded. I'll now like to turn the conference over to Luis Sanay by his president, Investor Relations.
Please go ahead.
Luis Sanay: Good morning and thank you all for joining us today to discuss our first quarter 2025 financial results and operational highlights.
Luis Sanay: A press release announcing our results is currently available on our website at Novavax.com and an audio archive of this conference call will be available on our website later today.
Please turn to slide two.
Luis Sanay: Before we begin with prepared remarks, I need to remind you that this presentation includes forward-looking statements, including but not limited to statements related to Novavax's corporate strategy and operating plans.
Luis Sanay: It's strategic priorities, it's partnerships and expectations with respect to potential royalties, milestones, and cost reimbursements.
Luis Sanay: FDA approval of the company's COVID-19 vaccine BLA and alignment on the post-marketing commitment, its expectations regarding manufacturing capacity, timing, production and delivery for its COVID-19 vaccine.
The development of Novavax is clinical and pre-clinical product candidates.
Luis Sanay: Full Year 2025 Financial Guidance and Revenue Framework, and Novavax's Future Financial Business Performance.
Luis Sanay: Each forward-looking statement contained in this presentation is subject to risks and uncertainties that could cause actual results to differ materially from those projected in such statements.
Additional information regarding these factors.
Appears under the heading, cautionary note regarding forward-looking statements
and the presentation we issued this morning.
Luis Sanay: and under the heading risk factors in our most recent Form10K and subsequent Form10Qs filed with the Securities and Exchange Commission available at SEC.gov and on our website at Novavax.com.
Luis Sanay: The forward-looking statements in this presentation speak only as of the original date of this presentation and we undertake no obligation to update or revise any of these statements.
Please turn to slide three.
Luis Sanay: This presentation also includes references to non-GAB financial measures which are total adjusted revenue and adjusted licensing royalties and other revenue and non-GAB profitability.
Please turn to slide four.
Luis Sanay: Joining me today is John Jacobs, our president and CEO who will provide an update on our progress during the quarter and highlight our growth strategy.
Speaker Change: Dr. Ruxandra Draghia, head of R&D, will discuss our R&D updates and finally, Jim Kelly, Chief Financial Officer and Treasurer, will provide an overview of our financial results in 20, 25 Financial Guidance and Revenue Framework.
Luis Sanay: John Trizzino, Chief Operating Officer, will be available for the Q&A portion of the call.
I'm sorry. I'm sorry. I'm sorry. I'm sorry.
John Jacobs: Out now, like to hand over the call to John Jacobs. Thank you very much.
John Jacobs: Thank you, Lewis. I'm pleased to be here with you today, along with members of our executive team to discuss our financial results and highlight the progress we have made in Q1.
Speaker Change: This earnings call marks approximately the one-year anniversary of our new corporate growth strategy, which was formed after signing our agreement with Santa Fe.
Speaker Change: Over the course of the past year we have moved away from our prior focus, which was allocating the majority of our time, energy and resources on commercializing our COVID-19 vaccine.
Speaker Change: To a strategy focused on optimizing our existing partnerships and expanding access to our proven technology platform.
Speaker Change: via R&D Innovation, Organic Portfolio Expansion, and forging new partnerships and collaborations with other companies.
Speaker Change: We believe this strategy enables maximum value creation from our cutting edge technology.
Speaker Change: In parallel, we are creating a significantly leaner infrastructure with continued cost reduction initiatives underway as we drive towards potential non-GAAP profitability as early as 2027.
Speaker Change: Via our new strategy, we intend to create multiple opportunities for value growth.
Speaker Change: Important catalyst this year include the potential approval of the BLA for our COVID vaccine.
Speaker Change: and other milestones related to the Santa Fe agreement. Preclinical data from our early-stage pipeline programs in the second half of this year and the potential for additional partnerships and collaborations.
Speaker Change: As an example, we are excited about the progression of our partnership with cicada, as it significantly improves the financial terms for Novavax in Japan, the third largest healthcare market in the world.
Speaker Change: This strengthened partnership with Takeda, a globally respected multinational pharmaceutical company, further validates the value of our cutting-edge technology platform and our efforts to become a partner of choice.
Speaker Change: Forging new collaborations and partnerships based on our differentiated tech platform and deep expertise in vaccine development is a top priority for us this year. And we look forward to sharing partnership updates with you as we continue to execute upon this key strategic pillar for Novavax.
Speaker Change: To guide our work for the remainder of 2025, we remain focused on three strategic priorities.
Our first priority is optimizing our partnership with Santa Fe.
Speaker Change: Our partnership with Santa Fe is a prime example of how we intend to work with others as we look to become a partner of choice and create long-term value for our stakeholders.
Speaker Change: As we have said before, this partnership has many important and potentially value creating elements to it, including.
Speaker Change: Milestones and royalties associated with the marketing of our COVID vaccine related to the BLA approval, MAH transfers, tech transfer, and ongoing royalties.
Speaker Change: Number two, milestones and royalties associated with the development of new combination vaccines.
that include our COVID vaccine.
Speaker Change: For example, Sanofi is developing two combination vaccines that include our COVID vaccine and their market-leading flu vaccines, both of which earned fast track designation from the FDA last year.
Speaker Change: And finally, milestones and royalties associated with any other new products developed using our Matrix M Agavant.
Speaker Change: Regarding our COVID vaccine, we are working constructively with the FDA with the intent of bringing the BLA process to a positive conclusion as soon as possible.
Speaker Change: FDA feedback on RBLA suggests a pathway to approval upon alignment on study parameters for the post-marketing commitment requested.
Speaker Change: We believe it's important that a non-MRNA protein-based COVID-19 vaccine option is available as a choice for US consumers.
Speaker Change: Our second strategic priority is to leverage our proven tech platform and pipeline to drive additional partnerships.
Speaker Change: Our team has been actively working on developing new partnership opportunities beyond Sanofi and the Material Transfer Agreement, or MTA, with a top-tier farmer company that we announced last fall to explore our matrix and adjuvant with bacterial pathogens.
Speaker Change: In fact, over the past few months we have signed new agreements
Speaker Change: including an expanded scope of the MTAI just mentioned to now include viral pathogens.
Speaker Change: We signed another new MTA for Matrix M with a different top tier pharma company.
Speaker Change: Entered a preclinical collaboration with a new partner to explore the application and utility of Matrix M with their cancer vaccine candidate.
Speaker Change: And as noted earlier, strengthen our existing agreement with Takeda for the COVID market in Japan including significantly improved financial terms for Novavax.
Speaker Change: These new agreements represent important steps in our continuing quest to add new partnerships throughout licensing efforts.
and further highlight the growing interest in our tech platform.
Speaker Change: We intend to optimize these new agreements with the goal of expanding the scope and value creation opportunity for each of them over time.
and we don't intend to stop here!
Speaker Change: We are actively seeking additional partnerships and collaborations with the goal of creating multiple growth opportunities in the short, mid and long term for Novavax.
Speaker Change: As we stated before, this ongoing effort includes seeking a potential partner to develop and commercialize our late-stage COVID influenza combination vaccine and stand-alone flu vaccine.
Speaker Change: And finally, our third strategic priority is to advance our tech platform and early stage pipeline.
Speaker Change: We are actively advancing our early stage pipeline programs using a capital-efficient approach.
Speaker Change: Our R&D investment strategy should allow us to make disciplined investment and programs aligned to the highest potential value opportunities both within infectious disease and beyond.
Speaker Change: Our intent is to partner these assets at early proof of concept stages, however for the right asset where data and commercial landscape indicate a unique high value opportunity.
Speaker Change: We would consider bringing that asset forward ourselves and will make that determination on a case-by-case basis as these assets mature.
Speaker Change: A bit later in the call, Ruxandra will talk about how we're using translational research and computational medicine to inform these investment decisions.
Speaker Change: We anticipate sharing some initial data on our new pipeline assets and new data on Matrix M and our technology platform in the second half of the year during an investor day.
Speaker Change: In summary, over the past few months, we have made significant progress on our new growth strategy, including the addition of new agreements with other companies,
Speaker Change: The expansion and strengthening of existing agreements with two major pharma companies.
Speaker Change: The initiation of four new early-stage pipeline programs and the continued advancement of our partnership with Sanafi.
Speaker Change: We remain confident that over the long run, our technology has the opportunity to positively impact the lives of billions of people around the world.
Speaker Change: that our strategy has the potential to drive significant value creation.
and that our team.
Speaker Change: has the knowledge, poise and skill to help carry us forward to an exciting and positive future for Novavax.
Speaker Change: I would now like to turn the call to Ruxandra to discuss our research and development updates, Ruxandra.
Thank you.
Thank you, John .
Please turn to slide six.
Speaker Change: It has been six months since joining Novavax's innovative R&D team and this time left me even more excited about the potential of our technology platform and the opportunity we have to strengthen and build on the depth and breadth of our partnerships.
John Jacobs: As John mentioned before, an important part of our corporate growth strategy is value creation through the advancement of our early stage pipeline and high quality R&D.
Value comes in different shapes and sizes.
John Jacobs: It starts in the lab, advancing programs and learnings in a continuous cycle of generating scientific data which in turn informs next projects and experiments with a goal of developing new vaccines and positively impacting public health.
John Jacobs: We have already accomplished a lot in a short time frame, and I'm encouraged and inspired by the depths, expertise and skills of our team.
John Jacobs: Since the start of the year, we initiated an advance for early stage programs.
after a rigorous prioritization process.
A-TRI-01, RSC combinations, shingles and C-D-F-C-L [inaudible]
John Jacobs: using information from translational models and leveraging artificial intelligence and machine learning.
John Jacobs: Furthermore, we continued our research into our COVID-19 vaccine and progressed our late stage programs in kick and flu.
Please turn to slide seven.
John Jacobs: We also continue to explore Matrix M and its potential impact across a variety of vaccine platforms and pathogens.
John Jacobs: including new formulation of Matrix M, generating data that demonstrate the utility of our adjuvant and sharing that with potential BD partners. Another example of us leading the way with science.
John Jacobs: In April , I presented at the World Vaccine Congress on the potential of Novavax's platform technology and Matrix M adjuvant showcasing attributes related to efficacy and tolerability.
John Jacobs: Data collected and analyzed from multiple clinical trials show that vaccine adjuvated with M have a milder reactogenicity profile compared to mRNA vaccines.
please turn to slide eight.
John Jacobs: Furthermore, we presented the results of the Shield Utah study at the Congress of the European Society of Clinical Microbiology and Infectious Disease Conference.
John Jacobs: All parameters measured in terms of fewer and less severe reactogenicity symptoms.
John Jacobs: and reduced the impact of the symptoms on quality of life, such as daily work and family responsibilities.
John Jacobs: We believe that real-world information showing that a better durability and the mild direct to genicity profile will lead people to prefer our protein-based technology over other vaccine platforms when given the choice.
Thank you. Thank you.
John Jacobs: In early studies, we are seeking to explore how neuromatics formulations, different regiments
John Jacobs: Could lead to improved vaccines, personalized approaches, and advancement in therapeutic areas beyond infectious diseases.
John Jacobs: As an example, we are currently developing research partnerships and collaboration in Immunoncology, a field that is rapidly progressing and one where we envision exciting potential opportunities for our technology.
by taking targeted risks.
John Jacobs: We expect to identify specific areas where magic Sam either is currently formulated or as a next generation formulation has a potential to improve rates and duration of anti-tumor responses.
Please turn to slide 9.
John Jacobs: We have previously reported that we developed a protein nanoparticle and matrix and vaccine against highly patogenic avian H5N1 virus that is currently undergoing per clinical evaluation.
John Jacobs: Non-human primate studies have shown our candidate vaccine can produce protective levels of immunity after a single dose.
John Jacobs: in Primed Animals. A situation like that of the human population which received a flu vaccine or had influence on the past.
John Jacobs: Alita Murin, Challenge Model, so complete protection in a similar vaccination
John Jacobs: Unlike other vaccines which might require two or more doses for full protection, the possibility to administer a single vaccine dose for protection is important in the context of a pandemic, both in the United States and globally.
John Jacobs: Furthermore, additional exploratory data in the context of our COVID vaccine have shown that our technology platform can induce mucosal antibodies.
John Jacobs: Mucosal protection is important not only for the person receiving the vaccine, but for instance for reducing virus transmission.
John Jacobs: of our vaccine platform, its design, scale up, and manufacturing processes should make a pandemic through vaccines from Novavax.
A manable to rapid deployment as an alternative to mRNA vaccines.
John Jacobs: We stand ready to join the United States and global health security efforts related to H5N1 and are currently pursuing funding and partnership opportunities for this program.
John Jacobs: Our new programs across our Discovery Portofolio are using artificial intelligence and machine learning enabled, structured driven optimization, rapid antibody testing for epitome assessment and novel in vitro and in vivo models for rapid preclinical testing.
John Jacobs: Our early stage pipeline includes development of an RSV combination vaccine candidate that builds on the company's extensive history in this area.
John Jacobs: Lessons learned regarding superior protein antigen design together with a new computational capabilities mentioned before should allow us to enhance
John Jacobs: Structural stability and immunogenicity and combine multiple different respiratory virus antigens.
John Jacobs: with much exam into this program, potentially created a competitive, meaningful and differentiated offering in this key area.
I'm sorry, I'm sorry, I'm sorry, I'm sorry, I'm sorry
Speaker Change: Many at risk adults are declining shingles protections or don't complete their vaccination series because of the fear of side effects.
Speaker Change: We believe our technology may lead to better vaccine candidates for the prevention of C-deficial, morbidity and mortality.
Speaker Change: There is no approved vaccine for C. difficile, yet the medical need is large, with C.D. related illness, including recurrent infection.
Speaker Change: Our technology has the potential to facilitate the development of a multivalent, adjuvated vaccine with enhanced activity that could provide a differentiated impact in an underserved patient population.
Speaker Change: We expect to share some initial data and earlier learnings on our early stage organic pipeline during the second half of the year.
Turning to our late-stage kick and stand-alone through programs.
Speaker Change: In December 2024, we started an initial cohort of a phase-free immunogenicity and safety trial for our kick and stand-alone influenza vaccine candidates in older adults.
Speaker Change: This trial completed enrollment of approximately 2,000 participants and we are on track to report
Speaker Change: While not a pivotal study, this data will be essential to inform the design of a subsequent pivotal trial in older adults for both programs.
Speaker Change: In addition, after further consultation with the US FDA, we determined that seeking an accelerated approval pathway for either of these assets would not be feasible.
Speaker Change: We intend to partner both vaccine programs and have the potential partner advance and fund all future clinical development, regulatory filing and commercialization activities.
Speaker Change: In summary, now, with an intense focus on science and readiness for partnering, we intend to advance and optimize our programs and generate initial proof-of-concept in preclinical
Speaker Change: I'm very much looking forward to sharing with you some of our first data results in the second half of this year.
Speaker Change: I'll turn the call over to Jim to discuss our financial results.
Well thank you, Ruxandra. Please turn to Slide 10.
Speaker Change: This morning we announced our financial results for the first quarter of 2025.
Speaker Change: Details of our results can be found in our press release issued today and in our Form 10Q filed with the SEC.
Speaker Change: Before reviewing our financial results, I would like to begin by noting that today we are reiterating our financial guidance for full-year 2025 combined R&D and SGNA expenses and raising our 2025 revenue framework.
Speaker Change: Last quarter, we outlined Novavax's path to significant value creation and potential non-GAAP profitability, and we are focused on the execution of this plan.
Speaker Change: More on these points later in my remarks. Please turn to slide 11.
Speaker Change: I'll begin with key highlights from our first quarter 2025 financial results.
Speaker Change: Novavax reported total revenue of $667 million as compared to $94 million in the first quarter of 2024.
Speaker Change: The 622 million of product sales in the current quarter includes 603 million recognized in connection with the termination of the Canada and New Zealand APA agreements.
Thank you.
Speaker Change: Both of these agreements are now fully closed and the revenue recognized relates to cash received in prior years. In addition, we recorded 45 million from licensing, royalties, and other revenue.
Thank you.
Speaker Change: During the first quarter of 2025, we continued to transform Novavax into a more lean and agile organization.
Speaker Change: We strengthened our balance sheet, reducing our current liabilities by over 60% compared to year end 2024 and improved our cost structure by reducing combined R&D and HGNA cost by 24% compared to the same period last year.
Speaker Change: I'm sorry. I'm sorry. I'm sorry. I'm sorry. I'm sorry.
Speaker Change: For 2025, we are reiterating our full-year financial guidance for combined R&D and SDNA expenses of between 475 million and 525 million. At the midpoint, this reflects a 30% reduction in compared to 2024.
Speaker Change: Of note, we continue to work with FDA on the parameters of the requested post marketing commitment study related to our BLA.
Speaker Change: For now, we believe it should be assumed that our multi-year guidance includes the potential impact to Novavax of this post-marketing commitment.
Thank you. Thank you. Thank you.
Speaker Change: If needed, our guidance and operating plan may be updated based upon the outcome of that discussion. In parallel, we are working closely with our partner, Sinofeet, to determine the potential approach to funding.
Thanks for watching. See you next time.
Speaker Change: We ended the first quarter with just $800 million in cash and receivables.
Speaker Change: During 2025, we anticipate earning an additional 225 million in milestones from Sonofi, assuming Novavax have it approval in the US and Europe , and a 20 million upfront payment in the second quarter from Takeda, related to our amended license agreement.
Speaker Change: These anticipated cash flows from our licensed partners highlight Novavax's potential to create significant shareholder value by monetizing our cutting-edge technology.
Thank you for watching. See you next time.
Speaker Change: based on our current operating plan, including milestone payments, royalties, and the multi-year expense targets. We have highlighted a path towards our goal of non-GAAP profitability as early as 2027, and maintaining at least the year and a half to two years of cash on hand at all times.
Speaker Change: Please turn to slide 12 for a detailed view of our first quarter revenue results and disclosures.
Thank you.
Speaker Change: You will see that beginning in this quarter we are highlighting two categories under product sales. Novavax of it reflects product sales where Novavax is the commercial market lead and records revenue related to the sales and distribution of our COVID-19 vaccine.
Speaker Change: This is where we historically have recorded our APA in commercial market sales.
Speaker Change: New beginning in 2025 is a category called Supply Sales that includes sales, a finish product, matrix and a match event, and other supplies for a license partners.
Speaker Change: Under Supply Sales, we act as a contract manufacturer to our license partners to support their development and sales of vaccines the customers around the world, leveraging our proven technology.
Speaker Change: In prior years, we recorded the supply sales under licensing royalties and other as they were less material at that time.
Speaker Change: For the first quarter of 2025, we recorded a total revenue of $667 million compared to $94 million in the same period in 2024.
Speaker Change: Product sales for the first quarter of 2025 were 622 million driven by 603 million of revenue related to the closeout of the Canada and New Zealand APAs.
Speaker Change: In each case, this resolution allows Novavax to retain cash previously received under these agreements and resolves any outstanding obligation via payments of 28 million and 4 million to Canada and New Zealand respectively in the first quarter.
Speaker Change: The remaining 5 million for Novavax event product sales in the first quarter relates to sales in the US and Germany.
I'm sorry. I'm sorry. I'm sorry. I'm sorry. I'm sorry.
Speaker Change: Our supply sales of 14 million in the first quarter of 2025 were primarily related to Matrix and Adjuvant Sales to our license partners.
Speaker Change: We recorded 45 million of licensing royalties and other revenue in the first quarter, consisting of 40 million related to our xenophia agreement and 5 million from royalties from our other licensed partners.
Speaker Change: The Sanofi Revenue consists of 29 million from the amigurization of our upfront payment and database lock milestones plus 11 million from R&D reimbursements in the period as we support Sanofi in their efforts.
Thank you. Thank you.
Speaker Change: Please turn to slide 13 for a detailed view of our first-quarter financial results, where I'll focus on our operating expense results and trends.
Speaker Change: First quarter, 2025, combined R&D and Estina expenses were 137 million and reflect a 24 percent reduction from the same period in 2024.
Importantly,
Speaker Change: Our SDNA expense of 48 million is 45% lower than the same period last year and is driven by the decrease in closeout of our global sales and marketing capabilities.
Plus strong execution on our broader cost reduction plan.
Speaker Change: Research and Development Expansives of $89 million in the first quarter of 2025 were primarily driven by our investments in the Phase III Campus Study and support of Sennofi for the upcoming COVID-19 vaccine season.
Speaker Change: A smaller portion of this land is presently directed towards our early stage preclinical programs.
Speaker Change: We intend to focus our attention on partnering or kick-and-flue vaccine candidates in this study reflects the material completion of our intended investments in this program.
Speaker Change: And finally, we reported net income of 519 million or $2.93 per diluted chair for the first quarter of 2025.
Thank you for watching. We'll see you next time.
Speaker Change: Our first quarter 2025 results highlight the significant progress we have made this year to improve our balance sheet by reducing current liabilities by $732 million.
Speaker Change: Since 2022, we have reduced Novavax's current liabilities by 2.1 billion and over 80%.
Speaker Change: During the first quarter, our changing cash of approximately 250 million included the elimination of many short-term liabilities.
and we expect our go-forward expenditures to be lower.
Speaker Change: Specifically, we anticipate our expenditure rate, which reflects our net spend.
Speaker Change: Prior to new cash flows from royalties and milestones, to be in the 140 to 160 million range per quarter and declining over time.
Speaker Change: We believe this progress places Novavax in a stronger financial position as we execute on our growth strategy.
Please turn to Slide 15.
Speaker Change: We are committed to streamlining our operating expenses to enable value creation. For 2025, we are reiterating our full-year combined R&D and SDNA expense guidance of between 475 and 525 million.
Speaker Change: We intend to invest approximately 70% of this combined spend into R&D to drive shareholder value as we allocate our resources towards what we believe are the highest return activities.
Speaker Change: During 2025, we expect our operating expenses to be highest in the first half of the year, as we speak and conclude, our kick flu study ended decline through the second half of the year.
Speaker Change: Looking forward, we expect to achieve combined R&D and SGNA expenses of approximately 250 million in 2027 and believe we are well on our way to achieving this goal.
Thank you for watching. And we'll see you next week.
Speaker Change: As mentioned earlier, we continue to work with FDA on the parameters of the requested post-marketing commitment study. For now, it should be assumed that our multi-year guidance includes the potential impact to Novavax of this post-marketing commitment.
Speaker Change: Reducing our cost structure is an important piece of our drive towards non-gaft profitability as early as 2027.
Speaker Change: We define non-GAAP profitability as gap operating profit, less non-cash items, such as stock-based comp and depreciation.
Speaker Change: Keys to the timing on our path to profitability are the successful development, regulatory approval and commercialization of products by our partners' synophie under our agreement.
Please turn to slide 16.
Thank you. Thank you. Thank you.
Speaker Change: Now turning to our 2025 revenue framework. Today, we are raising our prior revenue framework and now expect to achieve adjusted total revenue of between 975 million and 1 billion and 25 million.
Speaker Change: Our 2025 revenue framework excludes Sonofi's supply sales, royalties, and influence of the COVID-19 combination and matrix M related milestones.
Speaker Change: This means there may be revenue in 2025 that is additive to our expectations for adjusted total revenue for the year.
At Midpoint,
Speaker Change: The $675 million increase to our 2025 adjusted total revenue is driven by, first, the addition of $610 million of Nevexavid product sales that includes our first quarter results has a small amount of sales in the second quarter of 2025.
Speaker Change: Second, a 15 million increase to adjusted supply sales related to increased demand for Matrix M from Serum through the R-21 malaria vaccine and from Takeda for COVID-19.
Speaker Change: And third, a 50 million increase to adjust its licensing royalties and others that has two components.
Speaker Change: A 20 million increase to amortization related to the Sonofi Upfront Payment in Pediatric
Speaker Change: This reflects a timing update that shifts amounts into 2025 that were previously anticipated to be recorded in 2026.
Thank you for watching. We'll see you next week.
Speaker Change: We look forward to sharing additional updates as we improve Novavax's financial performance, cost structure, and strength to deliver shareholder value. With that, I'd like to turn the call back over to John for some closing remarks.
John: Thank you, Jim. In summary, we intend to drive a lot of value creation through our corporate growth strategy and in 2025 we'll continue to focus on our three strategic priorities.
Speaker Change: Priority 1, executing on our Santa Fe partnership, and in doing so successfully demonstrating our partner of choice.
Speaker Change: Priority 2, leveraging our technology platform and pipeline to forge additional partnerships.
Speaker Change: and Priority 3, advancing our tech platform and early stage pipeline to help foster additional partnering and growth opportunities.
Speaker Change: Thank you all for joining us today. And thank you to all of our employees for their continued efforts in advancing our business. I'm proud of our accomplishments to date and excited about the opportunity to drive future value from our strategy in 2025 and beyond. I'd now like to turn the call over to our operator for Q&A, operator.
Speaker Change: Thank you, we will now begin the question and answer session. To ask a question, you may press par followed by the number one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing at the end of the quiz.
Speaker Change: To withdraw your question, please press star, followed by the number two. At this time you will pause momentarily to assemble our roster.
Speaker Change: Your first question comes from the line of Roger Song of Jeffries. Your line's not open.
Roger Song: Greg Monning, thanks for the update and taking all questions. A couple of questions from us. The first one is regarding...
Roger Song: Kench is common on the nature of the study, you know, in terms of the efficacy versus safety requirement, and then also we just know in two weeks, we're packed going to host the meeting to select the strain for the 2025, 2026 season, how do you think this post marketing?
Roger Song: Commandment, I'm going to impact the 2025 and the 26th season, and I have a follow-up question regarding the kick. Thank you.
Roger Song: Hi Roger, good to hear from you and thanks for the questions.
Speaker Change: We haven't commented publicly on the nature of the post-marketing commitment at this time, but as we've said
Speaker Change: A few times and we'll continue to say today, right now we continue to work with the FDA.
Speaker Change: Dilligently and urgently to try to bring this forward as soon as possible to a positive conclusion and we do see a pathway forward to approval based on the formal comments and questions we've received from FDA. So, you know, we'll keep you posted as that develops and right now we're not seeing a direct impact on any any discussions for a pack maybe having on the season. Thank you very much.
Speaker Change: Related directly or indirectly to any requests we may have had in our BLA.
Speaker Change: Scott Asfair, and then regarding the mid-year data read-out for your kick, program, and the flow, what is the target profile you're looking for and then that to attract the partnership for the further development in the commercial relations? Thank you.
Speaker Change: All right, I'll hand that question over to Ruxandra Draghia. If we heard you right, you were asking about the nature of that data or what we're expecting or hoping to see in that cohort or at Ruxandra of our Phase 3 program.
Ruxandra Draghia: Thank you, John . So, as I have mentioned in my intervention, we have enrolled a first cohort of approximately 2000 individuals in this kick and flu study. We are looking for immunogenicity and safety data that could complement what we already have from our previous studies that would help design a phase-free trial. So, this...
Ruxandra Draghia: He is not an efficacy trial, let me be very, very clear. It is to generate additional immunogenicity and safety data.
Roger Song: Yeah, it's not a pivotal trial, Roger. It's a learning data set to help further inform what may be required for a full licensure with a partner. And as we've said before, it's our intention to partner both our late stage kick and flu assets out. That would be our intent.
Got it. Yeah, thank you.
Speaker Change: Thank you. Your next question comes from the line of Mayank Mamtani from B.R.I. Lee Securities, your lines now open.
Mayank Mantani: Yes, we've been minding being thanks for giving us a question, and I might progress on this.
Speaker Change: Yeah, thanks, Sean. So, I was wondering in context of this...
Speaker Change: Utah Shield Study that was published. I was just curious, how much is this quality of life, activities of daily living kind of factored in regulatory science, as you know, FDA as well as global regulators think of adjuvanted protein based vaccines versus mRNA and I was also curious.
Speaker Change: You know, the stock on contemporary placebo controlled study required, like how does that inform your thinking of what a registration enabling Phase III trial would look like for your holy own kick and flu vaccine? And I have a quick follow up.
Speaker Change: So, Mike, I'll hand out your first question over to Ruxandra. If we heard you correctly, if we understand your question, you're asking about the impact that data.
Speaker Change: From our shield study, that type of data may have on the opinions of regulators around the world. Did we hear you correctly?
Speaker Change: That is correct, and how you're thinking of the bigger pivotal study for the kick-and-floor in Conteau, okay? So, Rux, why don't you take the first question, please?
Speaker Change: We are going to look at that particular data. They are actually looking at the safety and efficacy of each of the vaccines on their own merit. But after the introduction of any vaccine, actually not only a COVID vaccine or flu vaccine in the population, they are a lot of these real world evidence studies that are looking at different characteristics.
in that particular category.
Speaker Change: Thank you, Ruxandra. And then, your next question had to do with were you asking about phase three for our potential late-stage asset, like our combination vaccine? Right, let's say. And whether or not it would be placebo controlled.
Mike: Yeah, just, you're thinking about what the vaccine efficacy study would look like after, you know, you've generated the [inaudible]
Speaker Change: Well, we're going to be again, as we said Novavax does not intend to take on ourselves further clinical investment in those late stage programs, we intend to do that with a partner. So were currently seeking a partner.
Speaker Change: And if and when we get a partner will be designing the study with them and at that time, then we will be disclosing how that study is designed when it comes to placebo controlled our existing efficacy data for <unk> of it was based upon an initial proceed placebo controlled trial with approximately 30000 patients. So we've done that.
Speaker Change: Before with our products, but any new trial would be designed with a partner that's our intent.
Speaker Change: Yes.
Speaker Change: That also since you bought together.
Speaker Change: Interesting.
Speaker Change: As I do experiment with an active comparator.
Speaker Change: Safi is some data expected in second half.
Speaker Change: And then maybe my follow up question was on the.
Speaker Change: Earlier stage pipeline.
Speaker Change: As you could go.
Speaker Change: Back to you on the on the <unk> IND filings human clinical trials for these earlier stage programs, you've identified and <unk>.
Jim Kelly: Jim can comment on that.
Speaker Change: All of these earlier discussion you are having for the Bakken.
Jim Kelly: The partner programs that are being reviewed is any of that.
Jim Kelly: Included any other financial guidance Shane thanks for taking our questions.
Speaker Change: Rob why don't you take mikes question on the early stage programs.
Speaker Change: So the definition of an early stage program is that it is early yeah.
Speaker Change: We are actually very diligently working on generating very rigorous preclinical data on each of the programs that I have mentioned and we would be happy to share with you and Oh with the external stake holders data in the <unk>.
Speaker Change: Half of the year, so I cannot comment on each and every one of the programs of exactly where we are.
Speaker Change: Preclinical so by nature. It is evolving practically every day, sometimes we have results twice a day so.
Speaker Change: Stay tuned for the second half of the year.
Speaker Change: And then I think Mike you were trying to ask about timing for any <unk> that might come out of our early stage program, but we haven't we haven't specified that at this time, but I think you'd use a normal assumptions on that when you are coming out of the clinic and I think more that'll be more clear also in the second half of the year as we as we share. Some initial results on these programs.
Jim Kelly: Jim on question two.
Jim Kelly: And Mike I think the final PUC as youre, asking whether or not any yet to be entered into.
Jim Kelly: <unk> are factored are included in our revenue framework and the answer is no. Our revenue framework is based upon our existing agreements. So stay tuned we're clearly working on on that front.
Jim Kelly: Thanks for taking our questions and look forward to those updates.
Speaker Change: Thank you. Your next question comes from the line of Alex <unk> of Bank of America. Your line is now open.
Speaker Change: Hey, guys. Thanks for taking our questions.
Jim Kelly: Just two from me.
Speaker Change: Maybe just starting on the AP.
Jim Kelly: Revenues that got recognized this quarter I guess, how much of this is maybe cash today versus cash.
Jim Kelly: Cash in the future or is it basically all all of it just revenue recognition of prior cash that's been received and then I've got a follow up.
Jim Kelly: Jim you want to take that one yes certainly.
Jim Kelly: Certainly a good question.
Jim Kelly: EPA revenue recognition, the $603 million from Canada, and New Zealand is noncash.
Jim Kelly: We had received that cash under those agreements in prior years of course, it was on our balance sheet and then through the termination and close out of those agreements.
Jim Kelly: What that meant is that we get to keep that cash under under the close out of those agreements.
Jim Kelly: Okay that makes sense.
Jim Kelly: And then maybe just one question.
Jim Kelly: Around the kick readout.
Jim Kelly: The middle of this year any borrowers for safety with the kick that you see as being maybe key for partnership interest in the program.
Jim Kelly: Is this maybe.
Jim Kelly: More and more important to view this versus the standalone component on its own or or versus the other vaccines that are in development. Thank you.
Speaker Change: But go ahead rock Sandra.
Jim Kelly: Okay.
Jim Kelly: So as I have mentioned we have presented.
Jim Kelly: The data coming from a multitude of clinical trials that we have undertook with our vaccine platform and Lisa matrix M adjuvant.
Jim Kelly: The World vaccine conference in by and large the safety and the Tolerability thereafter didn't ECT profile of our vaccines are favorable yeah.
Jim Kelly: So E. In this particular 2000 individual cohort aside from the Immunogenicity data, we will also supplement our safety data.
Jim Kelly: So for the moment I think that this is not something that is different from what we have seen in the past.
Jim Kelly: But of course data will speak and.
Jim Kelly: Again, we will have in the second half of this year additional data to share with you.
Jim Kelly: Okay.
Jim Kelly: Got it thank you thank.
Jim Kelly: Thank you.
Speaker Change: Your next question comes from the line of Tom Shrader of <unk>. Your line is now open.
Speaker Change: Thanks, Phil.
Speaker Change: Detail call very related question to the last one is the is the.
Speaker Change: Target profile of the combined vaccine is designed to make the reactor <unk> about the same as standalone flu or is that inherently unrealistic because the COVID-19 antigen is just reactogenic Reactogenic, then I have a follow up.
Speaker Change: Tommy I wouldn't say, we proactively designed to study based on react our Genesis, we designed it to demonstrate.
Speaker Change: An immune response to both of the pathogens that are being targeted with that vaccine as youre well aware and then we will see how the reactor Genesis profile looks we would expect it to be reasonable based on what we know about our tech and again. This is we need to be crystal clear to make sure everyone. What I want everyone to understand is this is a 2000 patient cohort. This is <unk>.
Speaker Change: What a pivotal trial. This is not a full phase III program. This is not designed for registration. This is not designed to definitively prove.
Speaker Change: <unk> anything long term about our vaccine what it is designed to do as a small cohort is too.
Speaker Change: Add additional data.
Speaker Change: Into into our data set to help us think about how to then design with a partner which is our intent.
Speaker Change: Ah study that would be targeted toward registration.
Speaker Change: So that's the goal.
Andrew: Andrew anything you'd add to that no you said it all ton perfect. Thank you. Thank you.
Speaker Change: And thanks for the question and ask it.
Speaker Change: If I can ask a follow up about.
Speaker Change: The filing for your updated vaccine that's in front of the FDA now how much human data is in there from the updated vaccine is it normal or is there a cohort for immunogenicity what has the FDA seen in terms of data of this exact vaccine in people.
Speaker Change: Thanks.
Speaker Change: Okay.
Speaker Change: Sorry, Tom where we just want to make sure we fully understand your question could you just clarify just take a shot at clarifying that and then work Sandra will try to answer you.
Speaker Change: So you have our filing in front of the FDA to update your vaccine.
Speaker Change: And the question is Theyre all human data in the filing.
Speaker Change: With with the updated vaccine. So they would have some sense that some number of people have seen the vaccine in.
Speaker Change: Probably to monitor Immunogenicity or is there no human data for the actual updated vessel.
John T: I see go ahead, John T, Yes, hi.
Speaker Change: Thanks for the clarification I think it is important to understand what the BLA submission is in what's being reviewed.
Speaker Change: Taking the existing product that's in market today under the emergency use authorization and getting a BLA approval for that vaccine remember the basis for that BLA is on the clinical data to date. There is no klim, new clinical data from our phase III efficacy trial and any other updated information that was.
Speaker Change: To that to that file it. We then after the approval of the BLA and some of the conversations we're having with FDA today.
Speaker Change: Would result.
Speaker Change: And then.
Speaker Change: Our readiness for the 'twenty five 'twenty six marketplace, which would include strained change, but first step again just to be clear is the BLA for the existing product with.
Speaker Change: No new clinical data relative to the JM <unk> strength.
Speaker Change: Assuming thank you John assuming we get the BLA approval and when we have it will have it until then we don't have it but assuming we get that then you'd make subsequent filings to your point for an updated version of the vaccine to target whatever variant we'd be targeting and then theres meetings upcoming to advise the government on that.
Speaker Change: <unk> <unk> was announced for later this month et cetera, where they'd make recommendations on that strain selection and then companies won't be making submissions to update their vaccines hopefully we've understood. Your question clearly and that was helpful.
Speaker Change: Absolutely. Thank you very much.
Speaker Change: Again, if you have a question. Please press star followed by the number one on your Touchtone phone. Your next question comes from the line of Eric Joseph Your line is now open.
Eric Joseph: Hi, good morning, Thanks for taking the questions.
Eric Joseph: A condition of approval for the COVID-19 vaccine.
Eric Joseph: <unk> with FDA, So we focus on the shape of the post marketing commitment.
Eric Joseph: Wanted to be confident that we can rule out additional quinn.
Eric Joseph: Clinical work.
Eric Joseph: That condition for initial.
Eric Joseph: Our BLA approval.
Eric Joseph: And then secondly.
Eric Joseph: To what extent does the.
Eric Joseph: Milestone.
Eric Joseph: Approval milestone from Sanofi.
Eric Joseph: Consider.
Eric Joseph: The post marketing commitments I guess, what I need to ask there is weather.
Eric Joseph: So may be impacted at all.
Eric Joseph: Additional clinical trial.
Eric Joseph: <unk> is a condition.
Jim Kelly: EMEA approval. Thank you Jim why don't you take the milestone question first certainly Eric the milestone based upon BLA approval is not impacted by post marketing commitment.
Eric Joseph: Yes.
Eric Joseph: Okay.
Eric Joseph: Alright, great and they are still eligible to receive.
Eric Joseph: <unk> BLA approved yet even with a post marketing commitment of 175 million milestone.
Eric Joseph: Thank you Jim and then Eric your other question, we just wanted to make sure. We understand clearly so are you are you asking.
Eric Joseph: Have we been asked to generate a new clinical study that would be required prior to a potential BLA approval and afterwards is that your question. We just want to make sure we're clear.
Eric Joseph: It sounds like additional clinical trial work is possibly.
Eric Joseph: Being requested as a condition of approval is that being asked for.
Eric Joseph: For approval or is it being asked is it can do.
Eric Joseph: Well I can just say what we've commented on publicly thank you for the question and if folks have that on their mind, we hope to make it as clear as we can at this moment in time based on what we've received to date, formerly from FDA, they're asking for a post <unk>.
Eric Joseph: Marketing commitment and.
Eric Joseph: And by definition, it's our understanding that a post marketing commitment comes after approval and you've begun to market that product.
Eric Joseph: So that's what we can share so far that's what we've said so far if anything changes, we'll let everybody know.
Eric Joseph: Okay.
Speaker Change: Great. Thanks for taking the questions.
Speaker Change: Thank you. Your next question comes from the line of Greece Law Bianco from Ed Securities. Your line is now open.
Speaker Change: So thank you for taking our question. This morning first to the best of your knowledge is the post hearing opening clinical trial requirement specific to note the batches BLA filing.
Speaker Change: Do you expect FDA will ask all COVID-19 vaccines, including the M&A vaccines.
Speaker Change: Agenda efficacy data for booster doses in a broad population with preexisting immunity and then I had one follow up question. Thank you.
Speaker Change: Thank you Chris for your question good to hear good to hear from you and now I'd like to ask the question back to you because of you know we'd love to find out.
Speaker Change: No it does but in all seriousness, we really can't speculate on Fda's thoughts regarding other companies' filings, we know that we have our conversations ongoing with FDA and that's all we can comment on at this time Chris.
Speaker Change: Great and then just my follow up question is has your confidence and receive the FDA approval of the BLA in 2025 increased decreased or remain the same.
Speaker Change: The Q call since the Q4 call in February 2025.
Speaker Change: Is it reasonable to expect an FDA decision near term I E 2025.
Speaker Change: Yes.
Speaker Change: Okay.
Speaker Change: Yeah, Chris I'm, not going to comment on an a score on where our confidence is but what I can do is share with you. What we've already said publicly which is that we're working right now with FDA and we see a pathway potential pathway forward for approval based on alignment on our post marketing commitment and as we learn more we'll let you know.
Speaker Change: Okay.
Speaker Change: Yeah.
Speaker Change: Operator.
Speaker Change: Yeah.
Speaker Change: Yeah.
Speaker Change: Operator.
Speaker Change: Folks it seems it.
Speaker Change: Seems like that was our last question and we seem to be having technical difficulty. So I would like to thank everyone for joining us today and note that we'll be ending the call. At this time. Thank you again for your time and questions have a great day everyone.
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