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Edited Transcript of NVAX earnings conference call or presentation 18-Mar-19 8:30pm GMT

Q4 2018 Novavax Inc Earnings Call

ROCKVILLE Apr 5, 2019 (Thomson StreetEvents) -- Edited Transcript of Novavax Inc earnings conference call or presentation Monday, March 18, 2019 at 8:30:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Erika S. Trahan

Novavax, Inc. - Senior Manager of Investor & Public Relations

* Gregory M. Glenn

Novavax, Inc. - President of Research and Development

* John Joseph Trizzino

Novavax, Inc. - Senior VP, Chief Business Officer, CFO & Treasurer

* Stanley Charles Erck

Novavax, Inc. - President, CEO & Director

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Conference Call Participants

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* Eric William Joseph

JP Morgan Chase & Co, Research Division - Analyst

* George B. Zavoico

B. Riley FBR, Inc., Research Division - Analyst

* Kevin Michael DeGeeter

Oppenheimer & Co. Inc., Research Division - MD & Senior Analyst

* Michael John Higgins

Ladenburg Thalmann & Co. Inc., Research Division - MD & Senior Biopharmaceuticals Equity Research Analyst

* Shawn Michael Egan

Citigroup Inc, Research Division - Senior Associate

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Presentation

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Operator [1]

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Good day, ladies and gentlemen, and welcome to the Novavax Fourth Quarter 2018 Financial Results Conference Call. (Operator Instructions) As a reminder, this call is being recorded. I would now like to introduce your host for today's conference, Ms. Erika Trahan. Ma'am, you may begin.

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Erika S. Trahan, Novavax, Inc. - Senior Manager of Investor & Public Relations [2]

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Thank you, operator. Good afternoon. I would like to thank everyone for joining today's call to discuss Fourth Quarter and Full Year 2018 Operational Highlights and Financial Results. A press release of our earnings 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.

Joining me on today's call are Stan Erck, President and CEO of Novavax; and John Trizzino, Chief Business Officer and Chief Financial Officer. Dr. Gregory Glenn, our President of Research and Development, will also be available for the Q&A portion of the call.

Before we begin our prepared remarks, I need to remind you that we will be making forward-looking statement during the teleconference that could include financial, clinical or commercial projections. Statements relating to future financial or business performance, conditions or strategies and other financial and business-related matters, including expectations regarding revenue, operating expenses, cash usage and clinical development and anticipated milestones are forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Novavax cautions that these forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. I'll now turn the call over to Stan to begin.

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Stanley Charles Erck, Novavax, Inc. - President, CEO & Director [3]

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Thanks, Erika. Welcome to our Fourth Quarter and Full Year 2018 Earnings Call. Today's call will be relatively brief because we provided you an update via a teleconference a few weeks ago concerning the Phase III results of ResVax.

In 2018 and through the beginning of the first quarter of 2019, the Novavax team has focused on advancing our 2 lead programs, ResVax and NanoFlu. I'm happy to say that we have achieved significant and important results for both programs. As we highlighted on our call at the end of February, ResVax is the first RSV vaccine to demonstrate efficacy preventing RSV disease in a Phase III clinical trial.

The successful Phase II result for NanoFlu that we delivered earlier this year provides the opportunity to discuss, with the FDA, the use of accelerated approval for licensure of our vaccine. We are now prepared to make meaningful advances in both programs during 2019. I'll start today's call by providing an overview of our ResVax program followed by an update on NanoFlu. John Trizzino will then provide a summary of our financial results. After that, we'll open up the line for questions.

So let's get started with the ResVax overview. As we've discussed with you at length before, it would be difficult to overstate a rationale for developing an RSV vaccine for infants. Statistics show that RSV is the leading cause of hospitalization in infants in the U.S., especially in the first 6 months of life. It is the second-leading cause of infant mortality globally in children under 1 year of age. Although we were disappointed to announce that the Prepare trial did not meet the prespecified criterion for the primary endpoint, ResVax did, however, demonstrate statistically significant efficacy against hospitalization associated with RSV lower respiratory tract infection at 44% with a lower band of confidence of nearly 20%.

Also, important results from prespecified exploratory endpoints, which address the most severe consequences of RSV, highlight the potential of our vaccine to provide -- to improve global health against RSV disease. As expected, the safety profile of RSV appears benign in both mothers and infants. As we continue to review these data, we found a geographic imbalance in that efficacy in children born in the United States was lower compared to the rest of the world by most measures. This seems to be related to the timing of immunization in relation to when the babies were born, which may have influenced both immunity and exposure to RSV. We expect to provide more details in future publications and presentations.

Prevention of hospitalization and more severe RSV illness is a key finding that merits further discussion with regulators, key opinion leaders and health care policymakers. ResVax showed the very clear and robust effects of a 25% reduction in all-cause respiratory hospitalizations and a 39% reduction of all-cause severe hypoxemia in infants and immunized mothers through 6 months of life. In addition to the obvious health benefits for infants and their families, we believe, this could have a major impact on the overall economic burden of RSV disease globally.

Since completion of the trial, we have shared much of the available data with our clinical investigators and with other key opinion leaders. The unanimous feedback we get is that these results represent a material advance in pediatric health. We're also pleased that our partners at the Bill & Melinda Gates Foundation recognize the importance of reducing hospitalization in severe hypoxemia, which are risk factors for infant mortality, a key element of the foundation's mission of reducing infant mortality. Given these results, the question on all of our minds is what can Novavax do to get ResVax licensed and on the market.

We believe the answer is, first, to complete our assessment of these data and put together detailed briefing documents for global regulatory authorities that demonstrate and support our findings. We intend to discuss these data with regulatory authorities with the goal of understanding whether these data could support licensure.

Following discussions with the regulatory agencies, based on the recommendations made during these meetings, the following paths will be considered. First, the data could be sufficient for licensure and we would then submit marketing applications. Second, the data could be sufficient for licensure and we will submit marketing applications with the commitment to conduct a post-licensure trial; or third, we may need to conduct an additional trial and then include the results and confirmatory data within the marketing applications.

While we hope for one of the first 2 responses, we are prepared for any of these responses and will timely develop plans based on feedback. As I said on our call in February, we are planning to have discussions with the FDA, the European Medicines Agency and other national regulatory authorities. All of these discussions take time to set up, but we are pressing to have them as soon as reasonably possible, hopefully in the second quarter or early third quarter of this year. We will provide an update on our progress at the appropriate time.

In parallel, we continue to assess the best partner for our ResVax program and perhaps multiple partners with capabilities in different geographies. Partner includes a potential combination of large multinational vaccine companies, smaller regional vaccine companies, and hopefully 1 or more global health sponsors and foundations. We're having new and ongoing discussions with all of these types of partners, and we'll keep you posted as these discussions progress.

An important element for our potential partners is how our various regulatory discussions proceed. I believe that we will reach conclusions on partnering shortly after we get more regulatory clarity. So let me conclude my remarks on ResVax by summarizing a few key points. Our ResVax vaccine works well at preventing more serious consequences of RSV infection. It's stable. The vaccine has an acceptable safety profile to date. We are focusing on addressing one or more regulatory pathways and we're continuing to execute on a global partner strategy.

Switching gears to our NanoFlu program. As a reminder, we started 2018 with very encouraging Phase I/II clinical results. Data from that trial demonstrated significantly improved NanoFlu hemagglutinin responses as compared to Fluzone High-Dose, the leading competitor vaccine in older adults. These data were published in the New England Journal of Medicine last June, a significant distinction for early-stage clinical trial results. In a subsequent 2018 meeting, the FDA acknowledged and agreed that the accelerated approval pathway could be available for NanoFlu. As many of you know, the accelerated approval pathway would allow Novavax to conduct a well-controlled Phase III trial designed to meet established immunogenicity endpoints against a licensed [comparator] with a commitment to conduct a confirmatory post-marketing trials to demonstrate clinical effectiveness.

We conducted a Phase II clinical trial of NanoFlu in the fall of 2018 in the United States, and a couple of months ago, we announced positive top line results. This trial compared the safety and immune responses of various quadrivalent formulations of NanoFlu with or without our Matrix-M adjuvant with 2 U.S.-licensed influenza vaccines in 1,375 healthy adults, 65 years of age or older.

All formulations of NanoFlu were well tolerated and elicited vigorous immune responses to the 4 strains included in the vaccine. NanoFlu also demonstrated significantly improved hemagglutinin inhibition, or HAI, antibody responses against wild-type H3N2 viruses, including drifted strains when compared to Fluzone High-Dose. As you may remember, H3N2 is currently the strain that causes the most morbidity and mortality in older adults in the United States.

We will again meet with the FDA in the next couple of months to discuss these Phase II data, the proposed Phase III trial design and the potential use of the accelerated approval pathway for licensure. If FDA agrees with this approach, given our successes in Phase I and II, we believe we can confirm these results in a pivotal Phase III trial. With that update of our 2 key programs complete, I'll now turn the call over to John to present a financial overview of the quarter.

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John Joseph Trizzino, Novavax, Inc. - Senior VP, Chief Business Officer, CFO & Treasurer [4]

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Thank you, Stan. Today, we announced financial results for the fourth quarter and full year of 2018. For today's call, I will focus on the key results for this quarter. The 12-month financial results can be found in today's press release. For the quarter, we recorded a net loss of $49.3 million or $0.13 per share compared to a net loss of $50.8 million or $0.16 per share in the fourth quarter of 2017. Revenue in the quarter decreased 41% to $6.1 million compared to $10.4 million for the same period 2017.

The Bill & Melinda Gates Foundation grant revenue is directly related to operating activities in the Prepare trial, and so therefore, this decrease in revenue is a result of completing enrollment of the Prepare trial in the second quarter of 2018. Related to our net loss for the quarter, R&D expenses decreased 13% to $43.4 million, primarily due to decreased development activities of ResVax and lower employee-related costs, partially offset by increased development activities of NanoFlu.

G&A expenses increased 8% to $9.2 million in the quarter, primarily due to higher professional fees. As of December 31, 2018, Novavax had $103.9 million in cash, cash equivalents, marketable securities and restricted cash. Net cash used in operating activities for the fourth quarter of 2018 was $45.3 million compared to $43.4 million in the fourth quarter of 2017.

One additional note is that we decided to utilize the ATM this quarter. Even though our stock price is considerably below what we believe to be its fair value, we concluded that it was more important to add to our balance sheet as we negotiate with potential partners and regulators. As disclosed in the 10-K, we added $41 million to our cash position this quarter from our ATM and expect that this will give us more room to evaluate our options. This concludes my financial review. And I'll now turn the call back to Stan for closing remarks.

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Stanley Charles Erck, Novavax, Inc. - President, CEO & Director [5]

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Thanks, John. To reiterate, 2018 and since the beginning of 2019, the Novavax team has remained focused on advancing our lead programs, ResVax and NanoFlu. I'm proud of the results we've achieved for both programs. I'd like to thank our current shareholders for their continued support. We look forward to updating you on our progress throughout the year. Operator?

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Questions and Answers

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Operator [1]

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(Operator Instructions) Our first question comes from Kevin DeGeeter with Oppenheimer.

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Kevin Michael DeGeeter, Oppenheimer & Co. Inc., Research Division - MD & Senior Analyst [2]

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Just a few from me. First, with regard to the potential Phase III study for NanoFlu, how are you guys thinking about the most likely comparator there? I guess, we're all sort of interested commercially in Fluzone and Fluzone High-Dose, but there may not necessarily be a quadrivalent comparator there. Do you think this compared against another quadrivalent or do you have -- think you have discretion to choose the more commercially relevant comparator in Fluzone?

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Stanley Charles Erck, Novavax, Inc. - President, CEO & Director [3]

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I think, that's a great question. We haven't decided which one we're going to compare against. What we achieved -- well, remember what we set out to do was show that our vaccine is better than the best-selling vaccine in a premium price market, which we did. We have now done it in Phase I, Phase II. Those results are in our pocket. So the Phase III could be any number of options. And so we'll talk with the FDA about it. You're right, Fluzone High-Dose might be a trivalent, and we might be encouraged to do it against a quadrivalent and there are choices to do it out there. And so we'll decide that in discussions with the FDA.

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Kevin Michael DeGeeter, Oppenheimer & Co. Inc., Research Division - MD & Senior Analyst [4]

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Two more housekeeping questions for me, then I'll get back in the queue. In terms of additional inflows under the agreement with the Gates Foundation, should we think of those continuing into the first half of 2019, or from a cash standpoint, is that largely squared up now the Prepare study is done? And then, John, you mentioned there were $41 million raised on the ATM in the first quarter of '19 so far. Can you just give us the share count that corresponds with that?

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Stanley Charles Erck, Novavax, Inc. - President, CEO & Director [5]

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Kevin, it's Stan. I will do the Gates Foundation first. We remained tied in with the Gates Foundation. Their view of our data on this trial is that we delivered what we had promised to them. And they liked that -- they're excited about the data. And I believe that they will work with us, not just through the rest of this year, but long beyond that to help us get licensure and product available for their countries. So I think we're going to have a long-term relationship, which will probably, hopefully expand the investment they're making in this program.

I think -- with Gates and everybody else, Kevin, I think, the -- before the question comes out, all this -- everybody is interested in this program. They like a lot of the parts of the data that came out with the Phase III trial and now the question is what's the pathway to licensure, and we're going to be pretty aggressive about trying to convince regulatory agencies that we have the data that supports licensure.

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John Joseph Trizzino, Novavax, Inc. - Senior VP, Chief Business Officer, CFO & Treasurer [6]

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Kevin, for the second part of your question on the $41 million raised off of the ATM in the first quarter of 2019, it was about 50 -- approximately 56 million shares associated with that $41 million.

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Operator [7]

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Our next question comes from Michael Higgins with Ladenburg Thalmann.

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Michael John Higgins, Ladenburg Thalmann & Co. Inc., Research Division - MD & Senior Biopharmaceuticals Equity Research Analyst [8]

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Congrats, guys. If I could on NanoFlu, regarding the Phase II, I believe, you mentioned that there may be an update coming on the later time points. So far you've provided Day 28. Are you still looking to give us an update on the continued efficacy to safety profile of NanoFlu, and if so, what time point?

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Gregory M. Glenn, Novavax, Inc. - President of Research and Development [9]

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Michael, Greg here. We are going to provide an update. It's not in the near future, but we do have Day 56 and Day 180 bleeds, and so we'll measure the HAI and report on that. So it -- I don't think we have a date yet for presentation of that data and we will publish it as well.

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Michael John Higgins, Ladenburg Thalmann & Co. Inc., Research Division - MD & Senior Biopharmaceuticals Equity Research Analyst [10]

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Okay. So that's not something we should look for a press release, but something to be presented at the conference and if I might, is that something coming in the fall then?

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Gregory M. Glenn, Novavax, Inc. - President of Research and Development [11]

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I think it will be sooner than that. So maybe Q2.

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Michael John Higgins, Ladenburg Thalmann & Co. Inc., Research Division - MD & Senior Biopharmaceuticals Equity Research Analyst [12]

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I'm sorry, you broke up there. Maybe when?

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Gregory M. Glenn, Novavax, Inc. - President of Research and Development [13]

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Q2.

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Michael John Higgins, Ladenburg Thalmann & Co. Inc., Research Division - MD & Senior Biopharmaceuticals Equity Research Analyst [14]

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Okay. Great. And then also if the FDA agrees as we're looking at that they would accept a [titer] as an approvable endpoint for Phase III, would this be against a particular strain, a couple of strains and then how does the success against drifted strains come into play as you're looking at endpoints for the Phase III?

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Gregory M. Glenn, Novavax, Inc. - President of Research and Development [15]

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Yes, so this again is Greg. So the comparison would be obviously against a licensed comparator vaccine, and we'd look for noninferiority against each of the homologous strains. So assuming it will be a quadrivalent vaccine, we would look to show noninferiority against all 4 of the strains. We, of course, are very interested in the drifted strain as we (inaudible) before, where antigenic drift and adaptation are big issues, and so we would also, as exploratory endpoints, demonstrate how our vaccine works against those other strains, especially with regard to H3N2 where this is a major problem.

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Michael John Higgins, Ladenburg Thalmann & Co. Inc., Research Division - MD & Senior Biopharmaceuticals Equity Research Analyst [16]

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Okay. And then just one on ResVax. Sounds like you've talked with KOLs, partners. Obviously, you're working towards a regulatory discussion in at least 2 regions. How would you say your outlook towards a partnership, global versus regional, is since the results have come from Prepare, more or less likely do you think as a global partner [for Q2]?

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Stanley Charles Erck, Novavax, Inc. - President, CEO & Director [17]

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Yes, it's too early to say actually. We've talked to everybody. Everybody likes the data and it just depends on what the regulatory agencies say and it may depend upon what the regulatory agencies say in Europe versus the U.S. or some other country. We've got really 2 major customers for this program: one is in low and middle income countries and the other one is in the high income countries. And within the high income countries, there may be 2 different pathways. So we don't know, but we're going to -- it's just -- it's a time issue and we'll know probably within the next, I don't know, 90 to 120 days is when we expect to have most of these meetings. And so we'll know a lot more.

So we -- there is a lot -- this is -- -- sorry, we're putting together all of the information that we have accumulated over the last 4 years and putting it into a way that's -- can be put into a briefing book, so it's understandable. So that takes a little bit of time, and then they have to have anywhere from 30 to 45 days or more to review it before you can have a meeting. So it's a little complicated, but we're getting there.

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Michael John Higgins, Ladenburg Thalmann & Co. Inc., Research Division - MD & Senior Biopharmaceuticals Equity Research Analyst [18]

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Yes, I'm sure it is. Just one quick follow-up. Would we have some feedback from you as to how those meetings go once you have the minutes back or after you've had those meetings?

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Stanley Charles Erck, Novavax, Inc. - President, CEO & Director [19]

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Well, we'll have to see, I can't predict so...

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Operator [20]

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Our next question comes from George Zavoico with B. Riley FBR.

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George B. Zavoico, B. Riley FBR, Inc., Research Division - Analyst [21]

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Let me start with the FDA, EMA regulatory agency deliberations and potential outcomes. The EMA had been a little bit more lenient in terms of what the lower band of the confidence interval would be for approval. So potentially, there may not be agreement between the FDA and the EMA. So if the FDA says you need to do post marketing or you need to do another trial, and EMA says go ahead and submit. Are you going to look for consensus or are you going to take 2 different paths? Or is it too early to tell about that as well?

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Stanley Charles Erck, Novavax, Inc. - President, CEO & Director [22]

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The answer is it's too early to tell. But, I think taking 2 different paths is not -- we had planned on -- we have always planned on filing with both at around the same time. And so if we get 2 different answers, we'll file with the one that is looking for a BLA.

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George B. Zavoico, B. Riley FBR, Inc., Research Division - Analyst [23]

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Okay. All right. And, Greg, I thought I saw that you were scheduled to speak at the World Vaccine Congress in Washington or...

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Gregory M. Glenn, Novavax, Inc. - President of Research and Development [24]

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We are, we are, yes.

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George B. Zavoico, B. Riley FBR, Inc., Research Division - Analyst [25]

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Is that going to be ResVax, NanoFlu or do you have -- what are you going to...

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Gregory M. Glenn, Novavax, Inc. - President of Research and Development [26]

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We haven't announced it yet. But I think it's going to be...

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Stanley Charles Erck, Novavax, Inc. - President, CEO & Director [27]

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We have 2 presentations scheduled for ResVax there and the ESPID.

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Gregory M. Glenn, Novavax, Inc. - President of Research and Development [28]

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And the other presentation is plenary. So yes, World Vaccine Congress, I think that's 24 April. And then the ESPID is 7th of May. ESPID is a plenary session for the European Society for Pediatric Infectious Diseases. That won't be me. I don't think we've announced. It will be one of the KOLs who will present that.

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George B. Zavoico, B. Riley FBR, Inc., Research Division - Analyst [29]

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Okay. And finally, I have a question about the all-cause -- a decline in hospitalizations of all-cause respiratory infections. I mean, that means that that's not necessarily RSV associated. Is it that RSV may contribute since it may be present or prevalent? It may impact the severity of flu or other respiratory infections. I'm trying to understand how that is different from RSV-associated lower respiratory tract infections?

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Gregory M. Glenn, Novavax, Inc. - President of Research and Development [30]

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Yes, so it's a commonly assessed outcome for vaccines. And I think we provided some information on the pneumococcal vaccine, which is a very, very good vaccine, where the -- so first of all, define all-cause, that would be the case definition without a pathogen diagnosis. So in the case of our vaccine, we saw a 25.3% reduction in all-cause lower respiratory tract hospitalization. That's a -- so that is the case definition of lower respiratory tract hospitalization, but no need for a diagnosis using PCR for RSV. So it does not require RSV detection.

So the analog to that, which, I think, we cited in our investor presentation, was the pneumococcal vaccine, which, as you know, is a very, very good vaccine. And its all-cause effect is around 4% to 7%. So to get to your question how do you explain this from a pathophysiology standpoint. So this -- the all-cause effect of our RSV vaccine has 3 -- we would say 3 manifestations. One, is to prevent the RSV we can -- we detect in the trial. The second is to prevent RSV that we are unable to detect or did not detect, which is expected. And finally, there are instances where RSV is antecedent for a secondary bacterial pneumonia or bronchiolitis, et cetera.

And so those, I'd say, people in our field of RSV vaccines are not surprised by the broad effect because RSV obviously is a leading cause of infant hospitalization and ubiquitous. So that effect, of course, is very, very important from a public health standpoint because it's affecting all all-cause. And we had the same effect for severe hypoxemia, a 40% all-cause reduction in severe hypoxemia over 6 months. And so these are effects that are related to prevention of RSV and have those -- I'd say those 3 explanations for the mechanism of action.

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George B. Zavoico, B. Riley FBR, Inc., Research Division - Analyst [31]

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And is that -- has this ever been a primary endpoint of any infectious agent that's probably...

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Gregory M. Glenn, Novavax, Inc. - President of Research and Development [32]

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No, no, no. Where it comes up -- no, it's -- where it comes up is after vaccines are licensed, people look at these things in terms of overall reduction of disease burden. That's -- and so it's a major important factor for health economics, et cetera. So you hope your vaccine would have some broader effect. And we, in fact, see, I think, a very, very good -- these are very promising effects. So they tell you the vaccine is working and in a trial, you just can't conduct -- you can't detect all of the disease, but this is the broadest net for assessment of the vaccine efficacy.

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Operator [33]

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Our next question comes from Joel Beatty with Citi.

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Shawn Michael Egan, Citigroup Inc, Research Division - Senior Associate [34]

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This is Shawn Egan calling in for Joel. Two from me on ResVax. When you think about partnership and the talks that you've had with them following top line, what has been the general feedback from prospective partners? And have either, or any, expressed any interest to be involved in these upcoming regulatory interactions?

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Stanley Charles Erck, Novavax, Inc. - President, CEO & Director [35]

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Well, you can't get into too much detail on these. We have a virtually -- all of the companies know us well. All of the companies know our program well. All of the companies appreciate that our 2 secondary endpoints, hospitalization and severe hypoxemia, are large health care concerns and are -- should be -- could be available for licensure based upon those endpoints. And so the question is how do you get there. I think they're relying upon us to set up the [beads] and make the arguments. And they would very much like to participate with us once we get answers back. And so -- so that's about as much as I can say from their shoes.

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Shawn Michael Egan, Citigroup Inc, Research Division - Senior Associate [36]

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And then the second question. One of the themes that came out of the Data call was moving the potential administration timing earlier. When you think about moving that earlier, if a subsequent study is needed, are there any real or hypothetical safety risks to that earlier administration? And do you have any data that could support it being safe?

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Gregory M. Glenn, Novavax, Inc. - President of Research and Development [37]

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Yes, I think -- so the current practice for both influenza and pertussis is to immunize earlier. Influenza, at any time in a pregnancy. Pertussis is recommended for second trimester immunization, and globally used that way. So I think what we did here is establish a very strong and, I would say, expected safety database around our vaccine. And we'd have to have discussions with regulatory authorities on how to extend that. We don't see that as a major hurdle if we were to move the administration to an earlier time point in pregnancy.

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Operator [38]

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Our next question comes from Eric Joseph with JPMorgan.

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Eric William Joseph, JP Morgan Chase & Co, Research Division - Analyst [39]

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Just a couple from us. I'm wondering if you can -- how you are thinking about the strategic optionality around NanoFlu at this stage in development and whether you're thinking differently about the potential to monetize it, perhaps in any way ahead of the start of the Phase III. And then on the regulatory front with ResVax, sounds like most of your focus is with the FDA and EMA here. I'm just wondering if you could talk a little bit about any potential plans to consult with individual national health authorities outside of those primary regulatory bodies and which country you might be -- you might prioritize in that process or when they might take place.

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Stanley Charles Erck, Novavax, Inc. - President, CEO & Director [40]

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Yes, this is Stan. So regulatory questions, regulatory authorities. Oh, I know, you want to monetize flu. So start with flu. Our -- once we have an answer from the FDA, which, we think, we're going to get relatively soon on accelerated approval, we'll know what the pivotal trial is and the commitment to do a post-licensure efficacy trial. Once we know that, we can -- we have choices then. We can either do the pivotal trial, which by Phase III standards will be a modest investment, and then you come out with licensable data. And so the question is, when you monetize it, do you want to do it before that and/or do you want to wait and have the data in hand? And so we haven't made that decision yet. We are going to wait until we get -- hear back from the FDA on what type of trial the next trial is going to be, and then we'll make that decision.

With respect to RSV, and yes, we will focus -- we're going to focus on -- well, we'll do FDA, we will do EMA, we are planning on going to -- I think last fall, we went and spoke with 5 different national regulatory agencies and had great feedback from all 5. We'll go back to those folks this -- in the next 3 to 6 months. And we're actually -- so we'll do all that, and we're actually exploring other countries in which we conducted the clinical trial like Australia and South Africa. And so we've got lots of work to do, to talk to all these places and see where is the best place to get our first sales of RSV vaccine.

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Eric William Joseph, JP Morgan Chase & Co, Research Division - Analyst [41]

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Got it. And maybe just coming back to the Bill & Melinda Gates relationship. You talk about having an ongoing relationship with them in the foreseeable future. Is there -- just wondering if you can talk about sort of any financial commitments or contributions, I guess, in addition to the agreement that's been in place up-to-date, whether they might be coming in with -- I guess, with additional resources as the regulatory discussions are ongoing?

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Stanley Charles Erck, Novavax, Inc. - President, CEO & Director [42]

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Right, the discussions are ongoing. I think we have another, well, $10 million or $15 million left on our original grant -- hang on, so we have another $16 million left, that will cover expenses over the coming couple quarters to finish up the commitments in the first grant. But with data in hand, we're talking with them, and obviously, those discussions have to remain confidential until we reach agreement on it. But as I say, they want to see the product get made, product released, product distributed in their countries. And so we have to figure out how to jointly do that and what the best way is. They're sitting on something that can go quickly into their countries, I think.

So I think that that's it on the questions. And we appreciate everybody listening and asking questions. And we'll talk to you, if not before, we'll talk to you at the second quarter -- first quarter call. So thanks.

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Operator [43]

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Ladies and gentlemen, thank you for your participation in today's conference. This does conclude the program. You may now disconnect. Everyone, have a great day.