Novavax delayed its timeline for ramping up the company's COVID-19 vaccine production until the latter half of 2021. Novavax President and CEO Stanley Erck joins Yahoo Finance Live to discuss.
JULIE HYMAN: Novavax, one of the companies that is still in the vaccine race, is yet to bring a vaccine to market. It's still working on it. The company says it does not plan to file for authorization for its candidate in the US and Europe until the third quarter. Also reported its numbers.
Stanley Erck is joining us now. He's the Novavax CEO and President, as well as our health care reporter Anjalee Khemlani. Stan, it's good to see you, give me some clarity and a little more detail if you would, around this timing now, which I know is a disappointment to some investors. Why not until it sounds like the end of the third quarter perhaps that this is going to be happening?
STANLEY ERCK: Sure, so now we're guiding for third quarter. We had been guiding for the second quarter. And we're not where we want to be as far as filing the documents, but we're close. I think we've made we've covered all of the major risks of the development of the vaccine as you know, we've got great data from a phase-- from efficacy trials in South Africa and the UK.
We're about to unblind phase three, a 30,000 person phase three trial in the US in a few weeks and we're really looking forward to those confirmation of all of our clinical and safety database. It's what the long pole of the tent has been is putting together all the package around the complex manufacturing data that we've accumulated. We've taken on the task of manufacturing our product in over 20 different facilities in eight or nine different countries and pulling those data together is taking us longer than we wanted.
We had planned on filing these documents by the end of the second quarter. And we're not going to make it by the end of June. So it's going to fall into the third quarter. And so we haven't put a date on it, but we're working to get through this massive pile of documentation. And we will. I think the risk is out of the filing itself and so we're looking forward to finally getting that in.
JULIE HYMAN: So what specifically, was it a documentation issue, was it a production issue? I guess I'm just having trouble understanding why you're pushing it out.
STANLEY ERCK: It's actually, it requires that when you are manufacturing product, a biologic, and a biologic is more complicated than just a chemical synthesis. When you're making a biologic you have to show that every lot you make is consistently identical to the previous lot, not only in the one plant but in several plants. And so you have to develop assays, what are called potency assays and purity assays that are difficult to develop.
I can say that we've developed them. We qualified them now, which is a big, big step forward. And now we're in the process of validating them. And you validate these assays by doing it time and time again in a variety of different conditions. So it just takes time and then putting that into documentation and unfortunately, it's time-consuming but it's at this point fairly straightforward.
ANJALEE KHEMLANI: Stan, looking at the production as well. It's not just you, but we've also seen other companies you know, seeing struggles with shortages and other things. I know that you have to basically have the expected production. Talk to us a little bit about that, especially as it relates to IP concerns, do you see a relationship between what you're trying to do and what would happen if, in fact, the US did agree to share intellectual property?
STANLEY ERCK: Yeah. Well, those are a couple of different questions. But first of all, the scale of manufacturing that we're doing is targeted toward getting us to the level of production of roughly a couple billion doses per year along with all of our partnerships, including the Serum Institute of India. And we've been heading in that direction.
We've run into some problems that I think the entire industry has run into, is that there are spot shortages of raw materials that are required to when you produce it. Seemingly simple things, simple-sounding things, like getting the 2,000-liter plastic, bag enough of those, or getting filters that are used in the purification process. We're working through them but it causes some delays and so we expect to be at that full capacity by the fourth quarter.
But it's not that we're not producing product now. We've made tens of millions of doses that are sitting in the freezer and ready to go when we actually launch product. My expectation is that we'll be in the 50 to 100 million doses per month range in the third quarter and then back up at full capacity certainly for throughout 2022 and hopefully by the fourth quarter of 2021.
The issue, the second issue you raised is one that's the current topic of the time, which is should we not give up our IP and freely give our intellectual property to anybody who wants to make our product anywhere in the world. In fact, we've done what that is intended to do and we're a year ahead of that. A year ago we concluded that our vaccine has to be used on a global basis. We can't just because we're a biotech company in the US, we can't just make product, particularly, if you expect that your product's going to be best-in-class, you can't just make it in the United States or just high-income countries.
So a year ago, we decided to partner with the largest pharmaceutical, the largest vaccine company in the world, Serum Institute, who vaccinates about 2/3 of the world's children in mainly in low- and middle-income countries, countries that Novavax doesn't have the capability of distribution and regulatory muscle and they do. And so we partnered them and we split the world. And so they're going to make all that product in a massive plant that they have and they'll make probably a billion doses in the next year, while we make a billion doses for the rest of the world.
And that's what this effort is intended to do is to get vaccine out as quickly as possible. It doesn't work to just send out your IP and people can't duplicate what we do. It would take years to do that. What we've done, we've accomplished that by licensing our product in four different continents already.
ANJALEE KHEMLANI: Absolutely. And it looks like you are seeing that your market is going to be largely global. You said yesterday on the earnings call that no one has determined the fate of the 110 million doses committed to the US. So who do you see as your market and where do you see these doses largely going?
STANLEY ERCK: Well, as we mentioned yesterday, and I think that the vast majority of our product in the third quarter and probably the fourth quarter are going to go to low and middle-income countries. We're going to take care of those countries first. We were funded to do this by CEPI and we partnered with Gavi and so a large part of our business is going to go to low- and middle-income countries until our manufacturing catches up and we can then supply a mixture of high-income countries and low-income countries.
JULIE HYMAN: Obviously important work across the board there. Stanley Erck, always good to see you. Thanks for joining us here this morning. Novavax CEO and President, and our Anjalee Khemlani. Thanks to you both.