Novavax Inc (NASDAQ: NVAX) This autumn 2020 earnings name dated March. 01, 2021.
Presentation:
Operator
Girls and gents, thanks for standing by, and welcome to the Novavax Fourth Quarter 2020 Monetary Outcomes Convention Name. [Operator Instructions]
I’d now like handy the convention over to your speaker at the moment, Ms. Silvia Taylor. You could start.
Silvia Taylor — Senior Vice President, Investor Relations and Company Affairs
Thanks. Good afternoon everyone and thanks to all of you who’ve joined at the moment’s name to debate our fourth quarter and full yr 2020 operational highlights and monetary outcomes. A press launch asserting our outcomes is at the moment accessible on our web site at novavax.com and an audio archive of this convention name might be accessible on our web site later at the moment. We’re additionally submitting our 10-Ok this afternoon.
Becoming a member of me at the moment are Stan Erck, President and CEO, who will present an outline of our progress thus far; Dr. Gregory Glenn, President of Analysis and Growth who will present an replace on our world scientific trial exercise and regulatory pathway; John Trizzino, Chief Business Officer and Chief Enterprise Officer, who will replace us on our manufacturing scale-up, partnerships and superior buy agreements; and Gregory Covino Chief Monetary Officer who will briefly spotlight our monetary standing; moreover, Dr. Filip Dubovsky, Chief Medical Officer, might be accessible for the Q&A bit on the finish of at the moment’s name.
Earlier than we start with ready remarks, I must remind you that we are going to be making forward-looking statements throughout this teleconference that might embody monetary, scientific or industrial projections. Statements referring to future monetary or enterprise efficiency, circumstances or technique and different monetary and business-related issues, together with expectations relating to income, working bills, money utilization and scientific improvement and anticipated milestones, are forward-looking statements throughout the which means of the Non-public Securities Litigation Reform Act. Novavax cautions that these forward-looking statements are topic to quite a few assumptions, dangers and uncertainties, which change over time.
With that, I’d now like handy the decision over to, Stan. For these of you following the accompanying slides, please flip to Slide 3.
Stanley C. Erck — President and Chief Govt Officer
Thanks, Silvia, and thanks to everybody for becoming a member of us this night. I’d prefer to make some opening remarks relating to how we’ve progressed as an organization and mirrored the place we’re headed on this coming yr. Following that we’ll take a while for questions. So the previous yr has been a whirlwind. We’ve utterly modified the corporate in ways in which would usually take a number of years to perform, whereas many companies on the earth have slowed down because of the pandemic, we’ve performed the alternative. Every little thing about our firm has modified.
Earlier than we get into our presentation, I’d prefer to thank all of our employees for the continuous effort that every of them has made for a whole yr. I’m afraid to say that I don’t see a slowdown anytime quickly. However having stated that, everybody understands the significance of our mission and may take satisfaction from the accomplishments which have been made to date and know that they’re a part of a as soon as in a lifetime mission.
I’d like to start out our presentation by recounting for you a shortlist of what our employees has achieved since our final annual earnings report. We’ve enrolled over 50,000 individuals in COVID-19 scientific trials. Within the spring of final yr, we accomplished enrollment in a Section 1/2 trial within the US and Australia, between September and February we initiated three efficacy trials within the US, the UK and South Africa, enrolling virtually 50,000 individuals. We’ve proven that our vaccine is 96% efficient in opposition to the unique COVID-19 when examined within the UK trial and achieved 86% of effectiveness in opposition to the UK variant pressure in that very same trial. Within the South African trial, with the so-called triple-mutant variant was circulated. We confirmed that our vaccine was 60% efficient at stopping COVID illness and the portion of the research inhabitants was HIV detrimental. What typically will get misplaced within the dialogue of our COVID-19 program, is that we additionally accomplished a Section Three pivotal trial for our NanoFlu program and met or exceeded all eight of our main endpoints. We began final yr with about 150 workers worldwide. We now have roughly 800 workers globally and can possible exceed 1,000 workers someday this summer season. We began final yr with none capability to fabricate product. Within the final yr, now we have constructed a worldwide community of producing websites and companions in 10 international locations, complete capability for COVID-19 vaccines will exceed 2 billion doses on an annual foundation by mid-year.
Originally of final yr we had $80 million in money and the monetary working horizon of solely six months. In distinction, we ended the yr with over $800 million and proceed to construct our monetary energy. We’ve now secured over $2 billion of funding from our companions, together with the US authorities and CEPI and the Invoice & Gates — the Invoice & Melinda Gates Basis and a purchase order commitments for our vaccine representing the potential for a number of billion {dollars} in income within the subsequent 12 months. The mix of all of those accomplishments provides capability and experience that would be the basis for Novavax over the long-term and most significantly, offers us the chance to offer the world, together with international locations of all revenue ranges with the protected and efficient vaccine that can be utilized to assist in the worst pandemic within the final century. We’re excited to share extra particulars at the moment on the progress we’ve made through the historic yr.
I’d now like handy the decision over to Greg Glenn to debate highlights from our scientific improvement program for 2020 and the start of 2021.
Gregory M. Glenn — President, Analysis and Growth
Thanks, Stan, and perhaps we are able to flip to Slide 4. This actually has been a exceptional yr. Over the previous 12 months, we’ve moved quickly to answer the COVID-19 pandemic. We first determine the stabilized recombinant full-length protein NVX-CoV2373 which I’ll name it 2373 for brief, as our vaccine candidate. We recognized this inside one month of the SARS-CoV sequence being revealed. We additionally demonstrated the important thing position of our Matrix-M adjuvant for induction of potent immune responses, when formulated collectively, confirmed that these elements elicited extremely protecting immunity in animal problem fashions. As you will note beneath, we’ve moved quickly by means of scientific improvement and now demonstrated the identical excessive degree of efficacy in people. Our scientists are dedicated to transparency and publication in top quality peer-reviewed journals and we all know satisfaction, we’ve met this purpose by means of a number of manuscripts a number of which you see right here, revealed in prestigious scientific journals, together with the New England Journal of Medication Science in nature.
So shifting to Slide 5. Our recombinant protein subunit based mostly vaccine 2373 provides a spread of sensible advantages, which we count on will optimize and expedite its world distribution. First, our candidate recombinant spike protein was designed to make sure stability and in consequence may be saved at typical refrigeration temperatures, enabling distribution by means of normal chilly provide chains. Moreover it’s prepared to make use of liquid formulation of each the protein and the adjuvant marketly facilitate the administration of the vaccine. The adjuvant Matrix-M is a essential function of the 2373 vaccine, which has each an immune enhancing and dose-sparing impact, permitting us to provide extra doses of 2373 with much less antigen required per dose, whereas lowering immunity that exceeds vaccine from a COVID-19 an infection. This significantly augments our world capability for vaccine manufacture in distribution.
On Slide 6. We offer an outline of our COVID associated scientific trials. The Section 1/2 security and immunogenicity trials demonstrated a key position to the adjuvant dose-sparing and the brand new responses they had been all properly in extra of convalescent sera. The information suggests the hallmark of our vaccine is the induction of excessive ranges of purposeful immunity and has a wonderful security profile. As well as, this research confirms the 5-microgram dose for the antigen. I wish to observe that there are a number of different immunogenicity trials which have already or might be beginning quickly in India, the Czech Republic and Japan that may assist to increase the worldwide entry to our vaccine. For day I’m — for at the moment. I’m going to give attention to the outcomes of our efficacy research. Throughout their conduct, the dramatic evolution of the virus occurred and we had been first to reveal FC in opposition to all three main circulating strains. This has led to very important perception for public well being and a novel alternative to reveal the utility of our expertise within the face of an evolving COVID-19 virus.
Let’s start by speaking about our Section Three trial within the UK on Slide 7. After initiating our trials September 2020 with the help of UK Vaccines Taskforce and the NIHR registry, we had been in a position to quickly roll over 15,000 individuals, 27% of whom had been over the age of 65. Our prime line interim evaluation confirmed an general efficacy of 89%. Nevertheless, through the conducting of this trial the virus developed and in opposition to the unique COVID pressure, just like the virus has seen within the mRNA trials, we demonstrated best-in-class efficacy of 96% with the B117 variant, the pressure that appeared through the trial, we noticed an 86% vaccine FC. This latter pressure is rising in outstanding within the US and it’s value noting that UK information means that 2373 will carry out properly within the US amid fast viral evolution that’s trending closely on this path. Though the first endpoint has been that extra circumstances have been collected and a remaining evaluation might be accessible within the coming weeks, contemplating the pathway to authorization, we initiated a rolling submission with non-clinical information with MHRA within the UK. We plan to file for authorization by early second quarter after now we have gathered adequate information from our UK trial and accomplished CMC necessities.
Shifting now to our Section 2b trial in South Africa on Slide 8. We enrolled a various research inhabitants of about 4,400 individuals, together with 245 medically secure HIV-positive adults. We achieved our main efficacy endpoint within the general inhabitants demonstrated in a major degree of efficacy at 49%, together with all individuals. It’s necessary to notice that 2373 additionally demonstrated 60% efficacy within the inhabitants that was HIV detrimental representing 94% of the volunteers. Throughout the conduct of the trial as I discussed earlier, the virus developed and through surveillance, the South African B1351 variant was extensively circulated throughout our trial, accounting for 93% of sequence circumstances. Though one-third of the research individuals had been seropositive baseline, these antibodies didn’t appear to stop an infection with 131 — 1351 once more suggesting that prior COVID-19 an infection didn’t defend in opposition to subsequent an infection with the B1531variant. Nevertheless 2373 did supply vital safety although the vaccine was derived from the unique COVID-19 pressure. This isn’t sudden as a qualitatively higher and broader response right here displays the teachings discovered from the Matrix-M adjuvant in NanoFlu vaccine that reveals within the face of evolution now we have applicable responses.
I would really like now to direct your consideration to Slide 9. We’re happy with the progress we’ve noticed thus far with our PREVENT Section Three efficacy trial within the US and in Mexico, which we performed in partnership with the NIH and the Coronavirus Prevention Community. Briefly the research design is a two-to-one randomized trial enrolling over 30,000 topics. You’ll be able to see, the first endpoint is aligned with our earlier trials and our interim evaluation might be performed with 72 circumstances and 144 remaining occasions. Lastly, we’re inspired to find extremely motivated participant inhabitants through the enrollment course of and we consider the two-to-one randomized research in addition to the expectation of a crossover elder performed a serious position in expediting recruitment.
Should you take a look at Slide 10, we are able to — accomplished enrollment inside two months of initiating this occasion pushed trial in December of 2020. And now we’re comfortable to report now we have a various research inhabitants of 30,000 individuals, which is comprised of 20% Latin American, 12% African American, 6% Native American, 5% Asian American and roughly 13% of the people 65 and older. We count on to announce this interim information from the trial within the second quarter, relying after all on the general assault price. As of at the moment, we’re working to implement a blinded crossover for each our UK Section Three and PREVENT-19 trials and these blinded crossovers, individuals will obtain energetic or placebo reverse to what placebos the individuals initially acquired whereas nonetheless stay in blinded. This design ensures the integrity of the blinded research and allows us to proceed following individuals at some point of efficacy and security. For PREVENT-19 our blinded crossover protocols have been submitted to the FDA and the up to date protocol together with the small print of the crossover have been posted on our web site underneath Sources.
So shifting forward to Slide 11. Relating to our regulatory pathway within the US, we’re in ongoing discussions with the FDA to align on the information required for initiation of EUA and proceed to offer data to our open IND utility. Right now, we count on to finish our EUA filings within the second quarter. Total, we’re very busy on the regulatory entrance and we’ve additionally started the rolling submission course of with a number of different regulatory authorities, together with the European Medicines Company, Well being Canada, The Australian Therapeutic Items Administration and New Zealand’s Medsafe. We’ll proceed to have interaction in dialog with respect to regulators as we full our pivotal Section Three scientific trials within the UK and US making certain that we absolutely handle all security, efficacy and high quality components required for authorization. As we glance to the longer term for our 2373 scientific program, we want to spotlight two areas of focus within the coming months. Our six-month boosting protocol happening in our Section 1/2 trial within the US and Australia and the event of a variant pressure in candidates.
On Slide 12, you see our Section 1/2 trial within the US and Australia initiated in Could 2020, offered optimistic information on 2373s immunogenicity and security. The trials proceed to supply worthwhile scientific insights with some individuals now receiving a six-month dose to look at the manufacturing of purposeful immune response. Our technical — expertise is appropriate for enhancing and agile sufficient to allow the fast improvement of a bivalent vaccine method that may handle an evolving virus.
On Slide 13, as I discussed, and now we have additionally made vital strides in addressing the mutations of the COVID-19 arising across the globe, together with exploring variant pressure vaccines as standalone and bivalent candidates. We’re evaluating these candidates in ongoing human primate research and plan to provoke scientific analysis in these candidates in mid 2021. We’re leveraging the adaptability of each our vaccine expertise and the manufacturing processes to evolve our technique alongside the evolution of the virus.
So inclusion on Slide 14. We now have two impartial trials demonstrating 2373’s excessive degree of efficacies at ranges just like that seen in the most effective outcomes in opposition to the unique virus pressure and the efficacy in opposition to two variant strains popping out of the viral evolution. We additionally see an encouraging security profile. We’re pleased with the scientific group as Stan talked about that’s achieved these milestones with 2373 thus far and look ahead to extra information within the coming months, together with information from the PREVENT-19.
And with that, I’d like to show it over to John Trizzino.
John J. Trizzino — Govt Vice President, Chief Business Officer and Chief Enterprise Officer
Thanks, Greg. I want to deliver your consideration to Slide 15, now. As you may see from this slide, prior to now 12 months, now we have constructed a powerful world provide chain infrastructure that features each owned and partnered services. This community is centered round our personal services within the Czech Republic and Sweden, partnerships with contract manufacturing organizations within the US, Canada, UK and Spain and license agreements in India, South Korea and Japan. The mixed capability for our COVID-19 vaccine globally will exceed 2 billion doses on an annual foundation, once we attain full manufacturing capability, which is anticipated by about mid-year. This world provide infrastructure securely positions Novavax as an integral a part of the worldwide resolution to the COVID-19 pandemic.
Let me spotlight among the following necessary factors. Novavax CZ within the Czech Republic is a big scale state-of-the-art manufacturing facility that’s now producing our vaccine antigens. Matrix-M is now manufactured at a number of websites globally with sufficiently dedicated uncooked supplies for our adjuvant element of the vaccine. The strategic partnership with Serum Institute gives vital and quick manufacturing capability that may present entry to low and middle-income international locations. SK Bio and Takeda licensing partnerships provides extra capability and entry into South Korea and Japan respectively. Along with the advance buy settlement in Canada, now we have only in the near past signed an MOU for expanded manufacturing capability in Canada at their Biologics Manufacturing Heart in Montreal.
Now on to the subsequent slide, Slide 16. What all of us have painfully come to know properly this previous yr is that pandemics haven’t any borders and due to this fact our response have to be on a worldwide scale. This mandated that Novavax reply in a number of methods to make sure a good and equitable entry globally. First, as a operate of our funding companions across the globe that embody the US Authorities, CEPI, UK and BMGF, the Invoice & Melinda Gates Basis. Then for the assorted international locations across the globe that expressed an curiosity in our vaccine and at last country-specific manufacturing companions that allowed our expertise to offer extra provide into India, South Korea and Japan.
In order you may see on this slide, now we have varied agreements which have been executed thus far. Advance Buy agreements totaling roughly 200 million doses. 110 million doses dedicated to the US Authorities with the potential for extra procurement. 1.1 billion doses collectively dedicated by Novavax and Serum Institute to the COVAX facility and license agreements with Serum Institute, SK Bio and Takeda.
With that, I’ll flip it again over to, Stan to offer an replace relating to our NanoFlu program on Slide 17.
Stanley C. Erck — President and Chief Govt Officer
Thanks, John. Whereas we spent nearly all of our time and a focus this yr growing our COVID-19 vaccine candidate, we stay dedicated to advancing NanoFlu by means of regulatory licensure. We introduced the profitable completion of our pivotal Section Three scientific trial within the first quarter of final yr reaching all main targets. Moreover, in November we revealed Section 2 information within the Medical Infectious Illnesses. We’re at the moment exploring quite a lot of choices associated to commercializing NanoFlu. These choices embody growing a number of mixture vaccines, reminiscent of 2373 and NanoFlu, NanoFlu and RSV and probably all three. Primarily based on information to be generated earlier this yr, the plan is to deliver a number of of those candidates within the scientific trials later this yr. As at all times we are going to publish outcomes of those research as they develop into accessible. We consider that within the post-pandemic period, seasonal vaccination with mixture vaccines might be a big industrial alternative for our platform.
And with that I’ll now hand it over to Greg Covino to offer our monetary outcomes.
Gregory Covino — Govt Vice President, Chief Monetary Officer
Thanks, Stan. Hello, everyone. Should you might please flip to Slide 18. So I believe our press launch does a fairly good job of operating by means of the highlights of P&L exercise quarter-over-quarter, along with laying out fourth quarter and full-year financing actions. So I’m not going to repeat that right here. We additionally simply filed our 2020 10-Ok previous to or through the course of this name. So the 10-Ok additionally features a abstract of necessary enterprise and financing occasions together with these which occurred subsequent to year-end. Specifically, we’ve included an replace on new provide agreements and John simply touched on that in his feedback and we make observe of the substantial completion of a brand new January 2021, $500 million ATM. So I’d encourage everybody to please check out the 10-Ok. Total contemplating our year-end money place over $800 million as you noticed within the launch and the financing actions subsequent to year-end, we consider we’re properly capitalized and in strong monetary place as we method the industrial launch of our COVID-19 vaccine.
Again to you, Stan.
Stanley C. Erck — President and Chief Govt Officer
Okay. Turning to Slide 19 as we mirror on the extraordinary progress Novavax made in 2020, we stay centered on delivering key scientific and regulatory milestones in addition to executing our world manufacturing and industrial plans in collaboration with our companions. In parallel, we are going to proceed to advance dialog with world regulatory companies that we are going to search authorization in licensure for 2373.
Earlier than I open the decision for questions, I wish to thank our complete Novavax group for his or her unbelievable contributions this yr. I’d additionally prefer to thank our varied companions, a number of of which embody the US Authorities, CEPI, the Invoice & Melinda Gates Basis, and the COVID-19 Prevention Community, whose quick response to the pandemic and continued help assist make potential our accomplishments through the yr. Solely by means of these mixed efforts, we’ve been in a position to obtain these excellent developments and develop into part of the worldwide resolution to the COVID-19 pandemic.
With that I’ll now flip it over to the operator for Q&A.
We’re nonetheless processing the Q&A portion of the convention name. We might be updating it as quickly as we analyze and course of the con name. Keep tuned right here for extra updates.
