Bavarian Nordic A/S (BAVA) Earnings Call Transcript & Summary

Good afternoon, and thank you for standing by. Welcome to the Bavarian Nordic Conference Call. [Operator Instructions] I must advise you that this conference call is being recorded today. I would now like to hand the conference over to your speaker, Mr. Rolf Sass. Please go ahead.

Yes. Thank you, operator. Good morning to some, and good afternoon to the rest of you. We are excited to be back here already, again, this time to present our exciting results of the human challenge trial of our RSV project. And to do that, I have here our President and CEO, Paul Chaplin; Executive Vice President, CFO, Henrik Juuel, that will walk through a number of slides to discuss our trial results. And afterwards, of course, Q&A. We have the opportunity to ask all the questions you may have. But before we walk through the presentation, I just want to read the following statements. This presentation includes forward-looking statements that involve risks, uncertainties and other factors, many of which are outside of our control that could cause actual results to differ materially from results discussed. Forward-looking statements include statements regarding our short-term objectives and opportunities, financial expectations for the full year as well as statements concerning our plans, objectives, thoughts, future events, performance and information that is not historical information. All such forward-looking statements are qualified by these cautionary statements. We undertake no obligation to publicly update forward-looking statements to reflect subsequent events or circumstances after the date made, except as required by law. And by this, I will hand over the presentation to Paul.

Yes. Thank you, Rolf, and welcome, everyone, to this call. It's my great pleasure in the next few slides that I will walk you through the fantastic results that we reported today in terms of the high efficacy that we've observed with our RSV vaccine canvas in the human challenge study. However, just to set the scene, if you turn to Slide 3, I want to talk a little bit about RSV, the disease itself and why today's news is so exciting, remind you about our differentiated vaccine approach and where we currently are in terms of the data we've generated to date. So RSV is a virus that causes the disease very similar to flu or influenza. And many people talk about RSV being very similar to flu in terms of hospitalizations due to severe lower respiratory tract infections and deaths as flu. However, there are a number of publications coming out, which are actually demonstrating that the morbidity and mortality of RSV is actually more severe. So if you look at the hospitalization stay, it depicts the number of days patients stay in the hospital is significantly higher for RSV compared to flu. If you look at the rates of respiratory complications such as pneumonia, it's significantly higher for RSV compared to flu. Look at pre-existing conditions such as COPD and asthma are significantly more exacerbated than flu, leading to, as I said, longer hospital stays. As the situation doesn't just last there, when you look at the mortality rates post hospitalization, so 1-year post hospitalization for either RSV or flu, the death rate for those patients who have been hospitalized for RSV is significantly higher compared to flu. So RSV can have a devastating impact causing hospitalization that has a significant effect on the morbidity and mortality of patients. So it remains a very significant unmet medical need and is one of the highest burdens on the health care system. So RSV can cause anything from mild symptoms from typical of a cold, which is often referred to as upper respiratory tract infections. And here, publications talk about antibody responses against RSV being extremely important in protecting against the upper respiratory tract infections. However, as I just indicated, it can actually cause more severe disease, often referred to as lower respiratory tract infections. And here, T cells have been shown in numerous publications to play an important role in clearing that infection. When we began to design our RSV vaccine candidate, we quickly realized we were going to be differentiated compared to the competitors who were all focusing on one antigen of RSV, which is the F which is surface protein. We quickly realized that with our vaccine platform that was insufficient, and we end up now with a vaccine encoding 5 different proteins, targeting both antibodies to prevent the upper respiratory tract infections, but also a broad T cell response to hopefully prevent from severe disease. In terms of the clinic, that's exactly what we've seen. We've now completed and already published both Phase I, Phase II studies where we've shown that our candidate MVA-BN RSV induces broad antibody responses, T cell responses against all 5 encoded antigens also in terms of mucosal immunity, which is the first part of the attack of the body's defenses to an RSV infection. And of course, regarding safety, we've shown typically with our MVA platform, a well-tolerated, good safety profile even in the [Audio Gap] So if you go to the next slide, Slide 4, we embarked on a human challenge study because we wanted to determine whether these fantastic and differentiated immune data that we've already reported could translate into an efficacy in terms of an experimental challenge. So on this slide, we're showing you the study design. We've had 2 groups essentially of 30 volunteers. One group was given a single booster of our RSV vaccine candidate, the other was given a placebo. Then they were challenged artificially with an attenuated RSV strain and followed up for 12 days. The primary endpoint of the study was this hopefully show a significant difference in terms of the viral load in the blood in the vaccinated group compared to placebo and numerous secondary endpoints where we're going to be looking at the clinical symptoms and also the immunogenicity of the vaccine and obviously safety. So if we go to the next slide, I'm very pleased to announce, as we did this morning that we were able to meet the primary endpoint. There was a significant reduction in the viral load in the blood in those subjects have been vaccinated with our vaccine candidate compared to the control. And you can see that on the graph on the right-hand side. The measurement that we do is a so-called area under the curve analysis, and this was significantly different between the vaccine group to the placebo, and you can see with a p-value of 0.017. The primary endpoint of the study has been met, and this is obviously a clear indication that our vaccine is highly efficacious in suppressing the viral replication following an experimental challenge. In terms of safety, no serious adverse events or vaccine related serious adverse events were reported, and the safety profile is identical to the ones that we've already seen and published in the Phase I, Phase II studies. In terms of the immune responses, again, exactly what we've already published. We induced good neutralizing antibodies that were not significantly boosted post challenge, indicating to us at least that the immune responses are sufficient to induce the efficacy that we're now seeing against the experimental challenge with RSV. If you go to the next slide, as the viral load slope was a bit small on the previous slide, we've blown it up. [Technical Difficulty]

Ladies and gentlemen, one moment please. Continue to stand by while we connect to the speaker.

Are we reconnected?

Yes, sir. Please continue.

Sorry for that. We apparently were disconnected. So I'll just start again on Slide 6. We took 2 measurements twice a day, yes, measurements twice a day to 12 days post challenge, and you can see there's a significant reduction or suppression of the viral replication in the vaccine group. If we look at the median value of the vaccine group, this is actually 0, which means that the vast majority of the vaccinated subjects had no viral load whatsoever. And if we look at the mean value, that's 94 in the vaccine group, 430 in the placebo group. So a highly significant suppression of viral over in the blood. And as I said, that fulfills the primary endpoints of the study. If we go to the next slide, Slide 7, as I said, one of the secondary objectives was also to look at the symptoms. So each volunteer recorded a number of symptoms each day, twice a day or 12 days post challenge. And you can see these are significantly suppressed in the vaccine group compared to placebo. So not only are we suppressing viral replication in the blood. This is translating to the reduction or elimination of any typical symptoms that you would see from a mild RSV infection. So what does this really all mean in terms of the vaccine efficacy and what we expect, hopefully, from a Phase III study. So if you go to the next slide, this is a little busy, and I'll walk you through it, but these are basically the 3 categories that everyone who has some challenge has really looked at. So if we start with the first level of efficacy, which we call asymptomatic or symptomatic, this is determined as a number of volunteers who had at least 2 positive PCRs for viral load. You can see that in the vaccine group that was 7 out of 30. In the placebo, that was 15 out of 31, and that translates to an efficacy of 51.8%. In the paper that was published using Ad26 as a vaccine candidate, the same efficacy was reported at 37.7%. The next level of efficacy is mildly symptomatic. This is, again, defined as 2 positive PCRs for viral loads and at least 1 symptom of any grade. You can see we only had 3 in the vaccine group versus 30 in the placebo, which translates to an efficacy of [ 76.2% ]. And again, in the paper published for Ad26, this is reported as 45.8%. If we then go to the most conservative level of efficacy, which we refer to as moderately symptomatic again, 2 positive PCRs of viral load and at least 1 Grade 2 symptom. We only have 2 subjects in the vaccine group versus 10 in placebo, and this translates to an efficacy of 79.3%. And again, in the coated paper for at 26, this is reported at 61.9%. Now for Pfizer, again, we are assuming that 100% efficacy that they reported in their Q2 also refers to the same level of moderately symptomatic. And while we had 2 subjects in the vaccine group, 5 that presumably had 0 and leading to 100% efficacy. But again, we have a group size of 30%, I'm not sure that's meaningful. If we go to the next slide, there is another way of measuring viral load. The first measurement and all the other measures we've been talking about is using PCR essentially. Another measurement, which was included in the study, was to actually recover virus through growth on tissue culture, and this is the efficacy I'm showing, which is slightly less sensitive than the PCR method. But again, if we look at asymptomatic or mildly symptomatic or moderately symptomatic, we now have an efficacy of 77.9%, 82.8% or 88.5%. And you can see at the more conservative level, we only have 1 subject vaccinated that meets this that failed to be fully protected at this more stringent criteria. And as I said, presumably Pfizer had 0. And again, is that meaningful, 1 subject, 2 subjects or 0 subjects in a group size of 30%. My opinion is not really. So if we go to Slide 10, just to sum up what I've walked you through. We have a highly differentiated vaccine encoding 5 different antigens of RSV. We've shown that this vaccine Canada stimulates so strong, broad antibody and T cell responses, including immunity in the elderly population. Today, we've announced extremely exciting results that, that has traded into a highly efficacious protection in a human challenge model. The next steps moving forward is to reopen the discussions with the regulators on our Phase III design. We have a design that was agreed with the FDA, but the world has changed post COVID, and we need to open up those discussions again. And as we've always said, we need to attract a commercial partner. So in the last 2 weeks, we've had a major derisking event that we announced last week in terms of securing the funding for our ABNCoV2 program on the back of reporting some exceptional data for that vaccine candidate. This week, we have derisked the Phase III with the announcement of the highly promising and exceptional data from a human challenge. And it's less about the risk of Phase III today for RSV more about the time to market. So with that, I will open up for Q&A. So operator, handing back to you. [Technical Difficulty]

[Operator Instructions] And we have 1 person that wants to ask a question. It comes from the line of Michael Novod.

It's Michael Novod from an Nordea in Copenhagen. So a few questions. First of all, you are referring to the clinical trial design and things have changed post COVID. So would you still believe that it would take a 2-season clinical trial in Phase III? Would that be a requirement or would that be suitable when you sort of discuss with the regulators? And then secondly, we've seen that the J&J has previously announced, they had a breakthrough therapy designation for the RSV vaccine. You seem to have data that's clearly better. I know there's challenges in comparing across trials, but clearly better data, is that also something you're seeking, i.e., a B2B on your vaccine? And then lastly, regarding partnering, given the likelihood of probably a larger trial is needed, given lower infection rates for RSV in society, is that something that sort of accelerates your pursuit of a partnership on MVA-BN RSV?

Yes. Thanks, Michael. So the first question related to the 2-season requirements for RSV, I think, in part, to be honest with you, the original design that we had for 2 seasons, we do for 2 reasons, one was to demonstrate the season at the requirements on seasonality in terms of the booster, but there was also a requirement to potentially derisk the study by having that futility analysis after Season 1. To be honest, as we sit here today, I think that requirement has now gone out the window as we have derisked the Phase III. So I think as I said at the end, I think now it's all about time to market. So we're looking at designs that get us the fastest approval possible. So I think we're looking at one of study very similar to most of the competition. The other question was the breakthrough designation. I think with the data that we've just reported, I think everything is very much on the table in terms of what we will pursue regulatory wise. And the last one was partnerships. We've said all along that we need a commercial partner. And the reason why partnering discussions have stalled is because whenever you're doing something that's going to generate people data, everyone wants to see that data. Now that data is reported, it's ours. We will resume those partnering discussions. And I'm sure there's going to be a lot of interest, given they couldn't have really asked for better data than what we already have. So as I said, I think we've derisked a lot of the things. And I think partnership discussions will now resume, and we do need a partner on board to commercialize the vaccine.

We have another question, and it comes from the line of Jesper Ilsoe from Carnegie.

So it's Jesper from Carnegie. So a question for you, Paul. So given that you say it's more about -- it's less about Phase III risk but more about time to market now given the data you've shown. So how do you actually see your, say, key selling points versus competition? So besides you having a 5 target instead of just the protein. So assuming, for example, that Pfizer actually shows quite good efficacy and assuming that GSK as well had a good vaccine, they are basically ahead of yours. So what key selling points do you have to actually gain decent market share in this market?

Yes, thanks. Well, the endpoint of all Phase III studies will be the reduction of hospitalization, which is obviously reducing severe disease. As I said at the beginning of my presentation, there's a lot of publications kind of demonstrating that T cells play an extremely important role in preventing those lower respiratory tract infections. I'm not saying antibody doesn't play a role at all, but T cells are crucial. And that is a big differentiating factor for our vaccine in that we are not only trying to stimulate antibodies but we're also trying to stimulate broad T cell responses. Now time will tell where that differentiating factor leads to a better efficacy. We have to keep in mind that with the human challenge data that we just reported is the prevention of mild symptoms of upper respiratory tract infections where antibodies are thought to play a bigger role. And there, we are toe to toe with the competition. So the whole discussion of pre-F or F alone, I think that's now been proven not to be of any value. We have F or we have pre-F, we will have the same efficacy. The question will be that in Phase III, do we have a superior efficacy from severe disease and time will tell, but that could definitely be a differentiating factor.

Okay. Perfect. That clear. How do you see your safety and others say, differentiation points, just as you know, administration, all these things you have in the COVID vaccine as well? So how are the other differentiating factors with yours versus competition, if there are any?

Well, I think the only one I can really comment on the Ad26 vaccine platform, obviously with you know... [Technical Difficulty]

Okay. You're line is connected back again, sir.

Thank you. Sorry, everyone, we were disconnected again. I was just answering the question about safety. And as I was saying, I'm not sure where we got cut off. Ad26 clearly through the COVID vaccination, we now had some issues in terms of rare, I would say, in terms of inducing blood clots. We have not seen such effects with our MVA platform to date. So that could be a differentiating factor, but time will tell. I think we're in the chase back here with everyone else. We need to start the Phase III. It's all about time to market, and then we'll see who has the better vaccine when the efficacy and safety comes out for the Phase III. But we remain very bullish and very upbeat about our challenges.

Would you like to proceed with the next question, sir?

Yes, please. Okay.

Our next question comes from the line of Michael Novod, is a follow-up question.

I just had a single follow-up question. So talking about the tolerability and your vaccine -- briefly had a strategy to go for the elderly. How are you sort of assessing this and maybe that's also going to be done sort of in collaboration with a partner around sort of taking it into children and adolescents where you also have a significant disease burden in the U.S., for example. So just some comments on that, please.

Yes. So our strategy has always been to focus initially on the elderly, which is what we'll do. But we will be exploring the pediatric indication. The timing of that remains unknown. But as I think you just indicated, that would be something that we'll discuss with hopefully, our future partner.

Our next question comes from Thomas Bowers from Danske.

I hope you can hear me. So just 2 questions remaining from my side. So if we just take -- so any comments you have maybe on the production capacity. So I'm just wondering now that you are sort of indicating time to market versus a 2-season trial here. So I just wanted to make sure that you are able to produce a large enough material for a large single season Phase III maybe to start in already 12 months' time or maybe even sooner if you are -- as you also think you have highlighted a potential including the Southern Hemisphere, so maybe even 6 to 8 months from now. And also with all the delay you had to do with the [ juniors ] in mind to produce a border vaccine? And then my second question, just looking at competitors, I may have missed some of your answers before on the fusion, but just going to ask you anyway. So it seems like big pharma consensus, you can say, has been focusing on prefusion as the best monovalent target. But in your multivalent approach, you sort of -- you stick to the F protein plus all the G&M and M2 or the subtypes. So with this data in hand, is it too early to make any new conclusions about prefusion? So I guess my question is, do you have anything in the data already that supports the F protein parts or is this more a multivalent approach that sort of limits the viral load in your view?

Yes. Thanks, Thomas. So the first question related to production, I can tell you we've already manufactured the Phase III material so that we have no problem on. In terms of -- it's an interesting thing you bring up the pre-F versus F. Our strategy has always been to try and mimic the immune responses that RSV would induce. Because we know if you had an RSV infection, you're generally protected for at least a year. And RSV doesn't have a pre-F -- it has an F and its expresses both pre-F and the full F. And we've shown from infected cells of our vaccine. This is exactly what we see. We see a mixture of pre-F and F. I think the human challenge model is all about, as I said, reducing mild symptoms. And it clearly goes that that's more related to antibodies and T cells. And if that is true and the data today says, it doesn't really matter whether we have pre-F or F. So I think that whole notion that the strategy of pre-F is superior. I think it's just gone out the window. I think where we may still have an advantage is that with a broad antigen approach stimulating a broad T cell response. As I said, if you look about preventing severe disease, most people believe that's more to do with T cells than the antibodies. And if that is true, we may have probably the best vaccine candidate in the bunch.

[Operator Instructions] We appear to have no further questions. I'll hand the conference back to you.

Okay. Thanks, everyone. Thanks for your time for the questions. Sorry for the technical challenges. But hopefully, the message got through. Thank you, and have a great day.