Novavax, Inc. (NVAX) Earnings Call Transcript & Summary

Ladies and gentlemen, thank you for standing by, and welcome to the Novavax NanoFlu achieves all primary endpoints in the Phase III clinical trials conference call. [Operator Instructions] I would now like to introduce your host for today's conference call, Ms. Erika Trahan, Senior Manager of Investor Relations and Public Relations. You may begin.

Thank you, operator. Good morning. I'd like to thank everyone who has joined today's call to discuss our Phase III NanoFlu results. A press release announcing our results is currently available on our website at novavax.com, and an audio archive of this conference call will be available on our website later today. Joining me on today's call are Stan Erck, President and CEO of Novavax; John Trizzino, Chief Business Officer and Chief Financial Officer; and Dr. Gregory Glenn, our President of Research and Development, will be available for the Q&A portion of the call. Before we begin with prepared remarks, I need to remind you that we will be making forward-looking statements during this teleconference that could include financial, clinical or commercial projections. Statements relating to future financial or business performance, conditions or strategy and other financial and business-related matters, including expectations regarding revenue, operating expenses, cash usage in 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 will now hand the call over to Greg to start.

Good morning, and thank you very much, Erika. It's my privilege to bring to you a Phase III data set that we're very pleased with. So I'm going to first go through the study design to remind you what we were doing in the clinical trial goals and design. So the primary objectives were to demonstrate a noninferior immunogenicity of NanoFlu related to Fluzone, and this is measured by hemagglutinin inhibition antibody assays. And we'll talk about this in some more detail, obviously. And we are also going to describe the safety profile of NanoFlu and Fluzone. So the secondary objectives were to describe immunogenicity with using both egg propagated virus and wild-type reagents for all 4 vaccine homologous strains and select "drifted" strains at Day 28. So we're also going to later on report, not today, assays showing microneutralization responses and the cell-mediated immune responses. So these vaccines that were tested were the recommended northern hemisphere influenza strains that are listed there, and I will go through them. This was a trial that was done stratifying older adults with the history of receipt of vaccine. It was the 2018/'19 influenza vaccine. And so this was in 2,650 clinically stable adults, 65 years of age. And it was randomized one-to-one between NanoFlu and Fluzone. They were given a single vaccination. And what we're reporting today is the Day 28 results. This was done over 19 sites, and we will have a 1 year of safety follow up, although today, we're reporting on the Day 28 results. Okay. So let's get to the data. So this is a summary now of the overall results. And as we've mentioned at the headlines, we met our primary endpoint. In fact, there were 8 co-primary endpoints and this -- the objectives here were to demonstrate immunologic noninferiority to Fluzone in terms of the hemagglutinin inhibition antibody assay and using egg-derived virus reagents, and so we'll talk about that in some depth. So this was tested against all 4 vaccine homologous strains. I will talk to you a little bit about the actual mathematical criteria as we go through the data. So the primary endpoint, just to summarize, using egg-derived viruses in the hemagglutinin inhibition assay against all 4 homologous strains. As you know, we've also been very interested in the wild-type responses as we feel that, that reflects both what's circulating in terms of viruses that are circulating and probably the most appropriate responses from a flu vaccine. So we have derived a wild-type VLP reagent based HAI assay. This is a secondary endpoint, and we can show here that we have a 24% to 66% improved Day 28 geometric mean titers against homologous or vaccine strains that is comparing NanoFlu versus Fluzone. We had a 34% to 41% improved responses against drifted H3N2 strains, which, as you know, is at the heart of the matter of the 4 [ FC ] of the flu vaccines today. The other criteria that we were looking at was seroconversion, and we have 11% to 20% increased seroconversion rate against homologous strains and 14% to 16% against "drifted" strains. We think the safety is quite good, and it was well tolerated. So let's dive into some of the details, and I think this will become clear as we look at the data. So on this slide, what you see now are the primary endpoints for the geometric mean titer ratios, that is we measure the HAI to NanoFlu. We measure the HAI responses to the quadrivalent. We're using egg viruses in this HAI assay, and then we do a ratio of the NanoFlu to the Fluzone Quadrivalent. And you can see there in the first red boxes, that ratio is for the different strains for A/Brisbane, A/Kansas, B/Maryland and B/Phuket. So we have 2 A strains. I remember, A/Kansas is an H3N2 strain, where there's a tremendous amount of drift. And you can see there that we have 1.09, 1.19, 1.03 and 1.23 point estimates, respectively. Now the success criteria for noninferiority was to meet a lower bound of a confidence interval of greater than or equal to 0.67 of this ratio. And you can see in the box in the right, those confidence intervals, you can see we had the lower bound was 1.03, 1.11, 0.99 and 1.16, respectively. So you can see we met the success criteria benchmark that the FDA set for success in our Phase I co-primary endpoints. So these are the first 4 co-primary endpoints, and we'll get to the other ones in just a minute. So if you go to the next slide, you can see here now the testing is now done with the -- HAI testing is done now with the wild-type antigen noted as VLP in the left there. And again, the same strain, these are the vaccine strains, the homologous vaccine strains. But now you can see the ratio between the GMTs for NanoFlu and Fluzone are 1.24, 1.66, 1.32 and 1.47, respectively. And then you can see on the right, the lower bound of the confidence intervals here was 1.17, 1.53, 1.26 and 1.40. I will note there, you can see at the bottom, the range of improved responses, of course, since the lower bound, the confidence intervals are above 0, these are significantly greater. So the NanoFlu gave us significantly greater response to all homologous strains using the wild-type assay. And there is superiority, which is a formal criteria where if the lower bound of the confidence intervals exceeds 1.53, it's met superiority, and you can see that for A/Kansas, the H3N2, the all-important strain that's drifting, we have a superior response using that statistical criteria. So if you go to the next slide, we also then thought it was very important, as you know, in the past, we've shown how the H3N2 viruses are mutating at very fast rate. It's made extremely difficult to choose the proper strain to match in the -- vaccine to match with what is circulating, you can see here then we took representative strains from different claves, we call them different families and mutations. And you can see here we had A/California, A/Cardif, A/Netherlands, A/South Australia, all contemporary circulating strains. You can see here again, the ratio of the HAIs is 1.4, 1.34, 1.38 and 1.36, respectively, with lower balance, well above 0. So again, we have a 34% to 41% improved responses to these "drifted" strains, and that reflects very much what we've seen in our Phase I and Phase II trials, where we have this breadth of responsiveness. In the face of drifting, mutating flu virus. As you go to the next slide, the other criteria that we were testing the vaccine for was the success criteria by the FDA is seroconversion. That represents a fourfold rise of percentage of subjects who have a fourfold rise over baseline from day 0 to day 28, they have a fourfold increase in the HAI titer. You can see the rates there, the raw rates by strain, again, this is based on the request by the FDA. This is a measure done with an egg-derived virus in the HAI assay. And you can see there are the respective seroconversion rates. And you can see the NanoFlu versus Fluzone Quadrivalent was 5%, 7%, 0.5% and 8.5%. Now again, the success criteria was for this seroconversion rate, the lower bound of the confidence intervals to be greater than minus 10. And you can see there, the lower bound is 1.9, 3.6, 1.9 and 5.0, respectively. So we met and exceeded, in fact, all the success criteria set out as our co-primary endpoint here. Now if you go to the next slide, we now turn to the secondary endpoints, which are the wild-type virus like particle measures. You can see again the seroconversion rate, the fourfold rise. You can see for NanoFlu, it's 32, 69, 25 and 35, respectively. And those amount to 11.5 -- sorry, 11.4, 20.4, 11.6 and 17.7 point estimates of a greater seroconversion rate based on the NanoFlu. And on the right, you can see the lower bounds all exceed 0, showing that these are significantly better seroconversion rates with our vaccine, something on the order of 11.4 to 20.4 percentage points increased over Fluzone Quadrivalent. The next slide then has the same analysis done with a wild-type virus like particle and the "drifted" strains. And again, you can see the seroconversion rates respective to Fluzone Quadrivalent were 16.6, 14.4, 16.8 and 14.7, and again, all the lower bound the confidence intervals, 13.1, 10.8, 13.3, 11.3 are greater than 0, and these are [ basically ] significant increases in the seroconversion rates. So again, just to step back for a second and look at the landscape here, we were asked by the FDA to test our vaccine against what was known, that is a licensed vaccine, in this case, Fluzone and using an assay, which Fluzone had been evaluated many times based on egg-derived viruses. We all know that in the past, the vaccines are beginning to increasingly differ in terms of their configuration of the receptor binding domain. And that especially is true when you grow the virus and eggs and then make a vaccine from this. So the egg adaptation has been a very important issue. However, to bridge our vaccine to a licensed vaccine, which is the point of this study and show that we have a noninferior immune response, we agreed with the FDA to use that assay. However, I think in the field, we see increasingly interest, and including at the agency, to use an assay that reflects the wild-type viruses that are circulating. And the VLP is a very agile platform. As you can see, we can test this against many strains. And in the case of H3N2, there are several clades that are circulating at once, and that allows us to test our vaccine against these different "drifted" strains. And so we are of the view, this is a very important biological result, showing what the vaccine potential can actually do if it were to be tested in the field. Finally, if you go to the last slide here of the top line safety, and what you can see here is the safety population of the top 1,333 ] and 1,319, and then you can see below the numbers and the percent in brackets of different events. And you can see here, any treatment emergent in an adverse event, there's a 49% rate with the NanoFlu and 41.8% in Fluzone Quadrivalent, that's largely driven by local adverse events. You can see below the local solicited rate was 27.9%, and you can see for Fluzone Quadrivalent is 18.4%. These are mostly mild and moderate events. You can see that the severe local events are less than 1%, very low rates, and this looks like a vaccine that has a good safety profile to us. So to summarize on the last slide, we met our primary endpoint. There were 8 measures in our co-primary endpoint. We met them all using the egg-derived virus reagents against all 4 homologous strains. We also then looked at the wild-type virus assay, wild-type VLP assay. And you can see there, we have a 24% to 66% improvement in the geometric mean titers against homologous strains, a 34% to 41% improved against drifted H3N2 strains, a 11.4% to 20.4% increase in the seroconversion rate against some homologous strains and a 14.1% to 16.8% increase against the drifted H3N2 strains for seroconversion. So we're very -- obviously, very pleased with this result. We think this is a landmark study. Again, confirming what we've seen in Phase I and II that the vaccine can induce superior responses. We're looking forward to sharing the cell-mediated immunity response, the T-cell responses, which, as you know, we assessed in our Phase II study. And later on, we'll be able to talk about our microneutralization. I think with that, I'm going to turn it over to Stan, our Chief Executive Officer here at Novavax. Thank you.

Thanks, Greg. And I have to thank the clinical, the regulatory and the CMC, the manufacturing team quality for a decade's worth of work to get to this point with a flu vaccine. I think that the take-home message that we think is important is that in 3 successive trials comparing NanoFlu against 3 different licensed vaccines, we show that our vaccine elicits broader and more robust responses. This is not only important in flu, but it is a clear demonstration of our recombinant nanoparticle adjuvanted vaccine platform. And in our view, the world is crying for a better flu vaccine, and we have one. And the good news is that we will apply the same technology to other respiratory diseases, including for COVID too. So what are the next steps? So as Greg mentioned, we will analyze the T-cell mediated responses from this Phase III trial. Likely, we'll have results within the next few weeks. And we expect to show that our vaccine is highly differentiated in its ability to stimulate strong T-cell responses, just as we did in our Phase II trial last year. We have fast track and breakthrough status, and we'll leverage that as we complete all of our CMC activities. We will conduct our required consistency lot trials next year in parallel as we put together our immunogenicity and safety portion of the BLA. When we have all of these activities mapped out, we will communicate these to you. So with that, I'll close this. We're excited within the company. We achieved every single one of our goals for this flu Phase III trial and happy to talk to you about it, and I'll turn it over to Q&A now.

[Operator Instructions] Our first question comes from Kevin DeGeeter with Oppenheimer.

Congratulation, guys, really great data. Greg, can you just comment a bit on the really interesting data with regards to the "drifted" strains? And specifically, when you think about a potential product label here, how do you expect data for "drifted" strains to potentially be treated in a label? And how might that be differentiated from some of the other product labels for Fluzone or other influenza vaccines?

Yes. So that's -- so this data, thinking about label, if you had a -- what you have as a package insert and you have a section where the clinical data is presented. And so we discussed, and of course, that has to be finally agreed upon with the FDA to include the data from the wild-type assay because I think they agreed. It's relevant, interesting and may become really the gold standard for measuring these types of responses. So I think that, that's what you'll see. As you can see in the package insert you look in there, and you'll see where we have statistically significant greater responses to the egg-derived vaccine, and that will be an important part of our profile is that we show that we're getting much better drift strain responses. So I would just point out what we -- as Stan mentioned, what we have in the future, is an efficacy study. So a lot of this is also building our confidence that the vaccine will work well. And I just will point out that what you're seeing here, and it's important is only part of the picture of what might be protective in a trial. So the receptor binding domain is an initial event for flu virus to infect a cell, and you see this is measuring essentially blocking that event. And so one would expect that this would be correlating with protection. But what we've shown, which is novel, I think, for flu vaccines, and we just published a paper -- preclinical paper, sort of looking at the mechanism, is we do elicit responses to the rest of the hemagglutinin. So that's -- remember, that is the glycoprotein that's on the service of the virus that both attaches and injects the viral genetic material into the cell. And so immune response to other parts of that structure should be protective. And we use monoclonal antibodies that we know individually can protect animals, can neutralize. So we have both head, we call it vestigial esterase, which is kind of on the side of the head, inside the trimer and antibodies to the stock, that are all elicited by our vaccine because we put this in a nanoparticle. We have these trimers, we have Matrix-M. And all that together, I would say, suggests that the antibody responses were measured here are somewhat at the tip of the iceberg literally. And the other immune responses will be important. So you can look up that paper. We just published, and we can make sure it should be posted on our website. And the other thing, and maybe even more dramatic is that in our Phase II trial, we showed that with the adjuvant, we induced a very robust CD4 effector cell response. And compared to the other comparators in that trial Fluzone high dose and Flublok, we have a much greater CD4 effector cell response get to our vaccine. So those things taken together, I think, would give us confidence that our vaccine could be much more effective in the efficacy study, and we're looking forward to the time when we can show -- demonstrate that.

That's terrific. And as my follow-up question, I know a number of people listening in this call are very interested in Novavax' progress on a COVID-19 vaccine. The Matrix-M adjuvant included in NanoFlu, I think you've discussed publicly, maybe part of that COVID development strategy. So can you talk a little bit more about the adverse event, safety profile of NanoFlu, specifically, to the extent possible, some thought processes on the adjuvant? And just kind of any other thoughts on a read-through from one program to the other?

Yes, that's so relevant, right? So the population will be similar. The most important target population for COVID vaccine should be the older population. Although, I think that's going to -- remains to be seen if who else did it. And here, so we have the same platform technology in nanoparticle, recombinant nanoparticle with Matrix-M, same dose we would use, and we've got safety, very good-looking safety data compared to another vaccine. And I think the key thing is the very, very low rate, what we call severe events. And so these being less than 1% for these local events, that's going to be very important here. And so that will be part of the safety database that we will call upon to move forward with the COVID vaccine. So I think we can make a claim that in a Phase III setting, of course, along with our Phase II data and data elsewhere that our vaccine is well tolerated. And Matrix is essential for responses to these vaccines, and even more dramatically so in a population that's immune naive like it is in COVID with Ebola, for example, which is a good analog that we're working on, we saw a dramatic improvement in the response of Matrix. And so we think that's going to be an essential element of a good working vaccine. Yes. And you may know this, we're also working with this -- with the collaboration with the Jenner Institute in Oxford, who is conducting a trial program, with malaria, and I think we'll be able to announce some of those results soon. And there, we have -- we're using our Matrix-M adjuvant, and this is infants now 5 months to, I think, 18 months who are in a highly malaria endemic area where the attack rate is something like 100%. And we know that in the preclinical and the challenge trials that Matrix-M is really important to improving the immune response. And also, by the way, dose bearing, you can use very low doses. So in these settings, for COVID is -- it's going to be important to have a lot of doses. We're going to be because it's immune-naive population, we can use a very low dose of antigen, we anticipate that to be help with the supply.

Our next question comes from Michael Higgins with Ladenburg Thalmann.

Congratulation guys on the data, very impressive, especially in the "drifted" strains. Just want to clarify the comment you just made regarding the M adjuvant in the COVID-19 vaccine. You mentioned Greg that the -- that this would be important in vaccine-naive patients to have the Matrix-M adjuvant, could you give us a little more detail as to why that is?

Yes. I think one thing I could point you to is we have published several papers on our Ebola vaccine. We did a kind of a, what I'd call, mechanism of action paper. It's very good. It talks about just how it works at the immunological level. So it increases antigen presentation, increases T&B cell responses and increases the affinity of the antibody. So all that together are highly desirable characteristics of an immune response. So in Ebola, we were able to, as you may recall, very quickly go from a gene sequence to a clinical trial. In that trial, we used Matrix and we used antigen at different dose in the human trial, I think, of 50, 25, 15 and about 5 micrograms with a single dose of Matrix. And what we saw was that there was no improvement by going up in the dose. In other words, we're at the top of an S-curve or response curve, and so it's very dose sparing. And we know that the level of antibody that we were developing with this -- with our Matrix-M was much higher than without the adjuvant. So that's in a JID paper published by Dr. Fries, Lou Fries [ at all ], and that also should be on our website. We think that, that is the pattern or the analog that you're going to see with the COVID response in humans, where they're largely immune naive. And again, it's a platform technology. It's a nanoparticle vaccine and Matrix-M, they're both critical. They both have very complementary assets in terms of immune stimulation. The VLP -- sorry, the nanoparticle looks like a virus, presents the full-length protein and Matrix-M allows the immune system to both see it, provide a mature and high [ infinity ] response and a much higher antibody response. And I think our -- if you look back at some of the comparative immunogenicity, I think immunogenicity from our vaccine was really the greatest vaccine, the highest level of antibodies that were described by -- in clinical trials. So we're very optimistic that, that kind of behavior, immune responses, safety will be reproduced with our COVID vaccine.

Regarding today's data, you've given us a lot of information. I'm looking back at the Phase II info from a year ago, and you've got a lot to chew on here. So this is great. But a follow-up from last year's. You've got 1-year data, I think, that came up around year-end last year or the trial rather finished around then. Do you have any 1-year follow-up from that Phase II to provide, it'd be helpful? Then also from this trial, you're also following them for another year. Are you bringing them in any earlier? Do you plan providing updates along the way from those visits? And what are you looking for in those upcoming visits?

Yes. Well, the answer is yes and yes. But the -- what happened here with our 6-month follow-up is it fell in the middle of pandemic. And so we had to do the safety follow-up but not the immunogenecity follow-up. So we're going to look for an opportunity potentially to get another immune response of bleed later on. But we're actually feeling very fortunate that we're able to conduct this trial and have the essential information generated before the pandemic arrives. So it makes clinical trial conduct. Obviously, it's of less concern to the world, but it has complicated clinical trial conduct. But we have -- this data, we have safety follow-up at 6 months. And we'll get back to you on the 1-year follow-up for the Phase II. I think that's about ready to go into a publication. And so I think that's -- that data will be there as well. I think what we have seen with our adjuvant vaccines is there's a persistent response, and that will be important through the season, obviously. So we'll have more data to come on this trial, too, as I mentioned. We had made a very large effort to get -- to look for cell-mediated immunity. It shouldn't be too long before we can update that. We think that's one of the important features of the adjuvant and saponin vaccine. Other adjuvants do different things. The saponins are extremely good at developing the cell-mediated immunity. We know people in the field, for example, the WHO are very enthusiastic about that arm of the immune response and the behavior of saponins in that respect. So that should be -- that data should be, again, available shortly. We can think about whether we have. I'll look to see if we can update the 1-year follow-up for Phase II as well, Michael.

Our next question comes from Mayank Mamtani with B. Riley FBR.

Congrats team for the impressive data set. So number one for Greg, could you may be put in context this data set relative to what you saw in Phase II? And I understand the strains were different in that of 2017, '18 flu season relative to the '19, '20, could you just talk to what you saw there relative to what this data set informed you?

Yes. I think our view is different strains, therefore, different assays, therefore, some at different measuring sticks. So it's going to be hard to take the exact numbers and transpose them to the other trials. So I think what we did in the first 2 trials were extremely important. We picked the leading, the market leaders, the best vaccines, did head-to-head comparisons there. So we have that data established. And here, what was very important for us is to have a strong result as we have without any kind of complications. We've met all 8 of our primary endpoints. And then we have very good data on, again, reinforcing what we saw in Phase I and II, then we have great immune responses to these -- to the drifts strains and so the wild-type. And so I think those are -- for me, those are that we've met -- we've done an incredible job the team has of taking a vaccine that we were thinking about, about 4 years ago and moving into Phase III in this time frame. We did a Phase I. We did a Phase II. We were able to agree with the FDA on the Phase III design, execute on a Phase III in the next year, complete the trial. I mean, this is really -- it's needed. We need a better vaccine. I think it is a sign of good collaboration with the FDA to have done this, but this is really a very fast development program. And I think we've ticked all the boxes, I think we want to do. And as I said, eventually, we're going to move this into an efficacy study, and all the data together gives us a lot of confidence that this vaccine would work better. But it's a very good question. I think each data set will kind of stand independently because, in part, the measuring stick, even though, then principal to same type of assay, the actual reagents, the actual strains, all those are very different. And I think we're extremely pleased that with 8 co-primary endpoints that we met every single one and these 2 different factors, ratios and seroconversion rates. And then we were able to look at what we think is more -- maybe more biologically relevant than wild-type responses. And those look very, very good to us. So I think taken together, this is really an excellent data set built on 2 really good trials that we've done in the past couple of years.

Great. And I do have a follow-up on the regulatory front. But just on the data, if you can focus on safety. Could you provide a little more color on what sort of events we are talking about, and really, what I'm trying to get at is the real-world implications for that? And just to clarify, have you quantified the 6-month follow-up yet?

Not yet, that recently happened. Generally speaking, what we see with the vaccines are local events within the first 7 days and a smattering of systemic events. But these rates that we're showing here are very low. I mean, we're talking about less than 0.6. So it's mostly soreness on the arm and some redness, sometimes there's a bruise, but that happens with almost everything. But you can see the rates for severe local -- these are mostly mild and moderate. So the severe local are less than 1%. These are very low rates. So I think this is extremely good profile for a vaccine that's generating such a good immune response. So again, we kind of had this question earlier, I think, for the whole program because we think Matrix is sort of a core technology for us for the whole program. This is, again, a confirmation of the platform is both safe and giving you a very highly desirable immune response. And so Matrix is a key factor. So safety is -- showing safety here is important. I think as I mentioned earlier, we have also safety in different age groups that would include in infants for the malaria vaccine. And we'll have more additional data on that. But the -- so the word is, right now, of course, there was no dropout events due to safety. So we know that at that level, of course, here, we don't say and we showed that there is no related serious adverse event. So I think a very good safety profile, a big safety database and gives us, again, confirms what we saw in the past in our other trials.

Great. And just clarification on the filing process going forward. Do you have to finish this 1-year safety database? And it might not be correlated to that, but just curious, why the batch lot to lot may start next year and not this year, any color on that?

I'm going to let Stan...

Yes. It's Stan. It's a matter of timing. We've been doing product characterization. We're going to be switching to what's called PPQ launch, which requires 12 to 14 successive runs of manufacturing, and then you put that into a consistency lot. And I think the target is somewhere around the turn of the year to start that, it's not a terribly complicated trial, but it takes -- taking into next year to get that done. While we're doing that, we put it in the other parts of the BLA, assembling the other parts of BLA and waiting for -- and we'll be talking to the FDA. This fast track designation allows us to have a lot of conversations with them. We can talk about what data is absolutely required in the BLA or post-BLA. So we'll be working on that. And as I've mentioned, we'll be communicating to you and the rest of the marketplace as we get near to knowing what the schedule is.

Great. And my final question is, could you remind us how we are tracking this flu season in terms of mortality and hospitalization rate for the elderly in particular?

The last time I looked, there were 40 million cases and about 20,000 deaths. Of course, those are all estimates. So -- and there's a big -- if you look at the CDC map, it's red -- it's dark red for most of the states. So there's still a flu season going on, so -- and very intent. So...

Okay. I think the last article, at least on mortality, had doubled the numbers, it was published, I think, this past week. But anything on the hospitalization rate you've seen?

Just -- I think that's -- no, I don't have an update on that. I think there's a big uptick in ILI, which is what the CDC tracks and very active still.

Our next question comes from Vernon Bernardino with H.C. Wainwright.

Everyone, congrats on the great results. Definitely looking forward to a better flu vaccine. Greg, I'm glad I caught you before you had to leave because my question is pretty much directed at you. What you mentioned as far as the hemagglutinin protein and the other sites that could be targeted in showing that you especially with Matrix-M have enhanced results. Is there any application to that targeting, let's say, of the spike protein in coronavirus that's applicable that could result in a better vaccine using your technology and your know-how, and even -- perhaps even assay that the FDA would be very interested in having?

Yes, the answer is yes. So this is Stan, Vernon, you missed Greg. He's -- I have to tell you things have gotten hectic in the company over the last 6 weeks. And Greg, in particular, gets pulled out quite often by a variety of agencies, including, I think, right now, the WHO. So the -- we are -- I think everybody is focusing on our efforts on COVID, too, and recognizing that Matrix-M has been so powerful and so safe. And now a variety of [ contacts ] and the world needs for a COVID vaccine. We think, the world is likely to need the benefit of an adjuvant like Matrix, which has broad safety profile. And clearly, it has the potential for dose sparing and immune enhancement. So that's the best I can give you, Vernon, I'm sorry.

Is there anything you can say about targeting the spike protein as far as what you've seen with the hemagglutinin and the flu virus as far as different kinds of vaccines?

I'm not sure, could you say the question in a different way? Are you asking is there a similarity between hemagglutinin and the spike protein and...

No, just not the similarity. I know they're different, but in the targeting of it. Such that -- I think Greg mentioned that from what you're seeing as far as the binding domains, your -- at least in the preclinical results you've recently published, you're seeing, you're able to target different parts of the hemagglutinin ahead itself and whether that's applicable in targeting the spike protein in different parts of this?

It is. We expect the same similar response where you got the equivalent of not just the head region, but the rest of the protein. That's -- when you form a nanoparticle, you expose other parts of the protein that can be immunogenic. So the answer is yes.

Our next question comes from Michael Higgins with Ladenburg Thalmann.

Just a couple of follow-ups, if I could. I'd be remissive if i didn't ask on the next steps for ResVax and COVID-19 vaccines. Last -- on the latter of the last update was the start of Phase I/II in May, June, if you can give us any updates on what those next gating steps are? And also, your recent quarterly conference call on ResVax. Your comments were very bullish that maybe you can get that program up and going again. Can you just give us some sort of timing and what those steps may be?

Yes. So I'll do ResVax first. In fact, ResVax -- in fact, RSV in general, I think that as we've stated before, we saw some profound efficacy results both in the older adult trial, and in particularly, the higher risk older adults. In efficacy there were reduced hospitalization in COPD patients by somewhere in the order of 50%. And then in the ResVax trial, we showed while I'm looking at our safety -- post hoc at our safety database, we showed a reduction in pneumonia-related hospitalizations by 50% of over a period of a year, which is our measurement period. Those are both very compelling results. And so the problem, as we've always said, is a regulatory one, where we missed our primary endpoint. We're doing everything we can to figure out how to get past that regulatory hurdle with or without another confirmatory Phase III trial. And we're not -- we don't have anything to tell you right now, but we're working on it. We think those are important milestones, never been done before on an RSV vaccine, and it's too important to walk away from. So we're very bullish on that. And then going back to COVID. I think we will -- the answer of what's happening with COVID is evolving on a daily basis, and we will report on our progresses. And the progress that I can report today is that we have a construct that we think could be important. We are getting animal data over the coming week or 2. We'll report on that when we do to show that the construct is properly folded and generates a specific immune response that could be protective. Then finally, vaccine production is important. And we've started GMP production already both for the Phase I/II clinical trial, and we're considering making larger quantities that could be used later on. So that's what we know today, and it changes every day.

And then one last one again on your mechanism with the expression and hitting the head and the side and the stock and so forth. Given the data you've got, the mechanism, is it your intention or consideration to approach the FDA in a more aggressive manner to suggest the removal of other seasonal flu vaccines, given the impact of mortality? You might see this in oncology. We've not seen this in seasonal flu, but we've not seen a drug perform like yours either, just want to get your thoughts on that potential?

I think that -- I don't think it's ours to suggest a removal of other vaccines. I think it's ours to show what ours does. We've shown that in -- 3 years in a row, the same result both from an antibody response and T-cell mediated response. What we have to show is the combined impact of those phenomena in an efficacy trial. And what we're now with the data we have and the data we're going to get on T-cell responses in a couple of weeks, really have to evaluate when we want to start an efficacy trial to demonstrate that, which we believe all these effects will show up in an efficacy trial. And so that's going to be our valuation over the coming weeks as the timing of that [ goes ]. So I'll stop there.

This is John Trizzino. I just wanted to follow up on a question that was posed to Greg earlier about disease burden so far in the U.S. for influenza. And the numbers are pretty significant and directly relate to the improvements that we hope to apply with our NanoFlu. So flu illnesses are somewhere between 38 million to 54 million flu illnesses. This is per the CDC website from October 1, 2019, to March 14, 2020. There are some 17 million to 25 million flu medical visits. There are some 390,000 to 710,000 flu hospitalizations, an estimated 23,000 to 59,000 flu deaths this season. So we're still battling a significant disease in influenza, and we hope to contribute to the prevention of that going forward.

Our next question comes from Eric Joseph with JPMorgan.

I guess, my questions are just on NanoFlu. And appreciating that the FDA wanted comparison with the commercial quadrivalent for initial licensure, I'm just wondering whether you could speak to your expectations around additional life cycle management with NanoFlu assuming approval? Whether you would seek to do further head-to-head comparisons with either the high dose Fluzone options? And also just in terms of host marketing expectations and potential efficacy study, the assumption here is that you be comparing against the Fluzone Quadrivalent that you attested here in the immunogenicity study?

Yes, Eric, this is Stan again. I'm sorry, we don't have Greg here. But we -- that's a decision we're going to have to make. We have tested it against high dose. We've tested it against Flublok and we have tested against quadrivalent standard dose. And those are all data that have been published or will be published and are part of our whole product characterization. And so we've -- from an immune standpoint, we've got evidence that it's better in terms of broader immune responses and more robust immune responses than all 3. The determination we're going to have to make in a Phase III efficacy trial is, number one, when to start the trials, number two, do you use it against -- do you use it against a comparator or placebo? I think there's options for both -- there are arguments for both. And frankly, we haven't made that decision yet. And we'll make it sometime within the coming months, but there are options. And there are reasons to do it from marketing reasons, to do it sooner rather than later, and we have to determine which comparator we'll pick, if we pick a comparator. So it's -- I'm only listing my options for you, but there's been no decision yet.

Ladies and gentlemen, this does conclude today's Q&A portion. I'd now like to turn the call back over to our host.

Okay. Thanks, everybody. As you can imagine, we are an exciting company right now as we've achieved everything we wanted out of this whole program that started almost 10 years ago. And we've got direction. We've got a differentiated product, which was the goal of the program. And that -- and the other things that are going on with COVID and RSV make us busy every single moment of the day. So we're looking forward to reporting continuing results on the programs throughout the year. Thank you.

Ladies and gentlemen, this does conclude today's presentation. You may now disconnect, and have a wonderful day.