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

Good day, and welcome to the Novavax COVID-19 vaccine Data Review Conference Call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Silvia Taylor, Senior VP of Global Corporate Affairs and Investor Relations. Please go ahead.

Good evening, everyone, and thank you to all of you who have joined us for today's call to discuss Novavax' initial Omicron cross-reactivity data from our COVID-19 booster and adolescent studies. 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. Please also note that we have posted the slides that we are using during this evening's call at novavax.com/events. Joining me today for discussion and a Q&A period are Stan Erck, President and CEO; Dr. Filip Dubovsky, Chief Medical Officer; Dr. Greg Glenn, President of R&D; and John Trizzino, Chief Commercial Officer and Chief Business Officer. Before we begin with prepared remarks, I need to remind you that we will be making forward-looking statements during this teleconference, which are based on our current expectations and beliefs. For example, statements relating to future financial or business performance, conditions or strategy, including expectations regarding revenue, operating expenses, cash usage, clinical development of our vaccine candidates, timing of future regulatory filings and actions and other anticipated milestones are all forward-looking statements. Novavax cautions that these forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time, and actual results could differ materially from what is described in such statements. We encourage you to consult the risk factors discussed in our SEC filings for additional detail. I'd now like to hand the call over to Stan.

Thank you, Silvia, and thanks, everybody, for joining the call. We're on a little bit of a tight time line today, but -- so I'll be brief. But just noting the number of announcements that we've had over the past few weeks, including product authorizations in Europe, in the -- with the WHO; in Indonesia, product shipments -- our first shipments of product to Indonesia; and then followed by not insignificantly starting up a new trial to test boosters -- to test our vaccine as a booster yesterday. But on top of all that, we have some important news, particularly given the prominence of Omicron currently, some news on -- some data on how our vaccine performs against this variant. And I'll turn it over to Filip Dubovsky, our Chief Medical Officer, who can go through the slides for you. Thank you.

Okay. Let's skip to Slide 3. And this really just lays out the clinical development plan. Those of you who follow us know this. We have 2 Phase III studies, 30,000 people and 15,000 people. And this was the basis of our efficacy data that we've gotten our approvals on. We also had a Phase II study in South Africa, and importantly, a Phase I, Phase II study in Australia, and this is our boosting study. We continued these participants through and boosted them, and this is some of the data we'll be sharing today. But I do want to remind you of the efficacy we saw in our 2 Phase III studies. They were remarkably consistent, 89.7% versus 90% overall. But the important numbers to look at here are the match strains, 96% for the U.K. study, 100% for the U.S. study as well as for the Alpha, 86% in the U.K. and 93% in the U.S. And these are important because they serve as benchmarks when you compare the immune responses against the variants we'll be looking at today. I guess one more point I'd like to make is that in the U.S. study, where we had the broadest number of variants circulating, we actually had complete protection for modern severe disease against all variants. So what kind of assays have we developed? So we're going to be sharing data from 3 types of assays. Let's move to Slide 5 now. We have a binding assay, which is just anti-spike IgG, ELISA. And this measures the ability of the antibody that's induced by the vaccine to bind to spike protein. And this is a fit-for-purpose assay that's being conducted at Novavax Discovery Labs. We have a human ACE2 inhibition assay. And this is a functional assay. Some of you may have seen data from this before, and we've published this. But what this assay does is probes the ability for the antibody to prevent the variant receptor-binding domain of the spike protein from actually binding to the receptor. And we know this is a required event for the virus to invade the cells. And it's a very stringent assay, as we've talked about previously. And this is also conducted in the Novavax Discovery Labs. And finally, we have a wild-type neutralization assay. And this is another functional assay that measures the ability of the antibody to prevent the variant viruses from invading cells. And this is conducted by our academic partner, the Matt Frieman Lab at the University School of Medicine, and this is also fit-for-purpose assay. Some of the other immune assays we've published on before are validated assays, and they are different than what we'll get to different values. So the data we have prepared to review today come from 2 studies. One of them is the U.S./Australia Phase II boosting study, and we have data from both after 2 doses as well as 3 doses with a 6-month boost. And there, we have the anti-spike IgG, the human ACE2 receptor inhibition as well as the variant wild-type neutralization. We also have a little bit of data from the adolescent Phase III study, and this is just data after 2 doses. Those participants haven't been boosted yet. And for that, we have variant IgG as well as human ACE2 receptor inhibition. So let's go to Slide 7. And this is just to remind you of the design for the Phase II study. This is a study that recruited 1,288 adults in the U.S. and Australia. And I've outlined here the arm that we boosted and we'll be describing today. So everyone received 2 doses at day 0 and 21, and then a portion of the subjects received a third dose at day 189 at 6 months. We continue to boost these subjects, and we have boosting data that's being developed now, boosting at 1 year, and that data should be available sometime next year. Let's move to Slide 8. And Slide 8 is data which comes from our clinical immunology labs. So this is validated assays, which are different from the assays we'll be describing in the near future. But what I've done here is transposed the immunoresponses we saw in the U.K. Phase III study on the left, the PREVENT-19 U.S./Mexico study in the middle and the boosting data we saw from the 6 months on the right-hand side. And I've overlaid the efficacy on top of that for both the prototype and Alpha strain. And what you can see is that we -- with the third dose, we got 3.7- to 4.4-fold increase of antibody compared to the -- what we saw in those 2 studies where we had high levels of efficacy. Let's move to Slide 9. And this is a companion slide which describes the wild-type neutralization response. Once again, this is an assay done at 360biolabs. So different from the assays we'll be looking at, so don't compare the values. But what you can see, once again, the third dose boosted, the immune response, 4.6 to 5.5-fold above that which we saw in the Phase III studies, once again, with high levels of efficacy against variants as well as prototype strains. So our first new data slide is Slide 10. And what this shows is the variant-specific IgG after 2 doses and 3 doses. So the left-hand side is a 2-dose data, and that's day 35; and the right-hand side is day 217, so that's 28 days after the 6-month boost. And we saw a variant-specific IgG response against all the variants after 2 doses. And in fact, we had 100% seroconversion against all the variants after 2 doses. And you can see we had a significant bump with the third dose, 5.4 to 11.1-fold above the peak responses we saw at day 35. Well, I've started the 2 prototype and Alpha bars. Just to remind you, those are the ones that we have efficacy with so you can kind of use those as a benchmark, although direct comparisons, of course, are tricky. So let's move to Slide 11. And Slide 11 shows the ACE2 inhibition responses. And once again, you can see we detected 2 inhibition responses against all the variants after 2 vaccinations, and we have a significant bump after the third dose. And you can see that after 3 doses, those levels were pretty much comparable -- or superior to that which we saw against the prototype with 2 doses where we saw efficacy. You'll notice that Omicron is lower than the others. This is completely expected. Remember, the Omicron has many mutations in the receptor-binding domain. And that's what really this assay measures, is the ability for the spike to bind the ACE2. So we would anticipate having a lower response against Omicron. However, the third dose really does correct the magnitude of the immune response to Omicron as well as the other variants. So let's move to Slide 12. And Slide 12 shows the wild-type neutralization responses. And this assay done at the University of Maryland is a 99% neutralization response. Some other people run this as a 50%, but this is a bit more stringent, and -- which you have compares for prototype Delta and Omicron is the day-35 responses versus the day-217 responses. And you can see in all 3 instances, you get a boost with the third dose up to quite high levels. The difference between the prototype and the Omicron is about -- it's less than a 4-fold difference after 2 doses. Although I should caution you, these are different viruses, so comparing between various viruses in this assay should be done with caution. I guess you can also see that the day 217 responses are really comparable to those that we saw for 2 doses on day 35, suggesting that efficacy will be maintained with a 3-dose schedule. So let's turn to the PREVENT-19 study. This is overall design. Once again, this is a study where we had 30,000 adults, 2/3 of them received vaccine, 1/3 received placebo, and then we crossed them over. So those who received vaccine initially got placebo and those who received placebo initially got a vaccine. We did a sub-study for that, including adolescents, and that had 2,248 adolescents. And once again, 2/3 received vaccine and 1/3 received placebo. And the data we'll be reviewing is the data that we generated for the immune responses after 2 doses in the vaccine group. So let's turn to Slide 15. What you see on Slide 15 is the anti-spike IgG for all the variants, and this is after 2 doses once again. And you can see that we had very high levels of antibody against all the variants, including Omicron. And in fact, the immunoresponses in adolescents were 2- to 3-fold higher than that which we saw in adults. And clearly, since we had 100% seroconversion in adults. We had 100% seroconversion against all the variants in these adolescents as well. And let's go to Slide 16. Slide 16 shows the ACE2 inhibition data. And once again, we saw values which were higher than that in adults 2.4- to 4-fold higher than we saw in adults. And these results also compare quite favorably to what you can see with 2 doses in adults that which we did in the Phase III study in the U.S. and U.K. So I want to take the opportunity to reiterate what our next steps are for the Omicron vaccine development. Given that we do have an ongoing pandemic, we're obviously developing an Omicron-specific vaccine. The GMP manufacturing is expected to begin soon, and we expect to be in clinical studies in the first quarter of the new year with our material. But let me go to Slide 18, which tries to sum up kind of what I've described today. So from our Phase III studies, we demonstrated protective efficacy against a broad array of variances circulated while we conducted those studies in the U.S./Mexico as well as the U.K. For our anti-spike IgG response, we saw 100% seroconversion to prototype, Alpha, Beta, Delta and Omicron after 2 doses. Furthermore, we boosted these responses 5.4-fold for prototype, up to 9.3-fold for Omicron. And that's above the peak responses seen after the 2-dose primary vaccination schedule. And this represents a 61-fold for prototype and a 73-fold for Omicron increase just prior to the boosting with dose 3. For the human ACE2 inhibition assay, we observed ACE2 activity against the prototype, Alpha, Beta, Delta and Omicron after 2 doses. And after we boosted with the third dose, we achieved 100% seroconversion in -- against all variants of the population. These boosted titers increased firm 6-fold for the prototype, up to 19.9-fold for Omicron compared to the peak responses following the 2-dose primary series. And this level really represented a 54-fold for the prototype and a 24-fold for delta and a 36-fold for Omicron increase from just prior to the boosting dose given at 6 months. For the wild-type neutralization assay, and I want to reiterate, this is a 99% wild-type assay. We observed neutralization after 2 doses for Prototype, Delta and Omicron. And after 2 doses, the Omicron wild-type neut response was a little bit less than 4-fold lower than for the prototype. We saw significant increases after boosting to both Delta and Omicron, and these are comparable to the levels we saw in the U.S. and U.K. study as far as absolute magnitudes of neuts. And finally, I'll share with you some immune responses in our adolescents. And they very much matched what we saw for the IgG and ACE2 responses in the adults, except they were 2- to 4-fold higher following 2 doses of vaccine. So with that, that's the end of my prepared remarks. I will turn it now over to the operator for Q&A.

Sorry, this is Stan. I just want to make one remark before we do turn it over to Q&A. I think that -- this is -- the audience should recognize that this is yet another demonstration of the power of our technology platform. We get very broadly neutralizing antibodies through the combination of our adjuvant and recombinant nanoparticle, and in the case of COVID, we've done that yet again. So with that, I'll turn it over for -- to the operator for Q&A.

[Operator Instructions] Our first question comes from Kelechi Chikere with Jefferies.

Just a couple of questions on my end. I guess, first, can you help put into context the data that you're presenting here and the data that we've seen for the mRNA vaccines, particularly as it relates to the full reduction after 2 doses versus Omicron and the fold increase after the third dose? Any additional color there or context there would be really helpful. And I guess my second question is just related to -- can you just speak to whether you've forgone your decision to move forward with a multivalent vaccine? Or is that something that you could still do in Q1?

So maybe I'll take the first question and Greg can jump in as well. So it's very, very difficult. It's, in fact, more than difficult. It's possibly fraught with error to try to compare immunoresponses with -- using different assays, right? So I think within an assay, it's a fair comparison when you start comparing things like full rises, like you mentioned, we had a little bit less than a 4-fold decrease for our wild-type neuts compared to some of the others, which may or may not have been higher and same for the fold increase after boosting. So I'm not sure that I can say a lot more. Greg, do you have an opinion on this or a view?

Well, yes, I agree with that. The absolute numbers and magnitudes are a little -- that is difficult to say. However, I would point out that what Filip presented is data on very stringent assays, the inhibition assays and mechanistic assay, that requires a very high-affinity antibody to block binding of spike to ACE2. And we're detecting antibodies that do that for Omicron after the 2-dose regimen. And similarly, with the wild-type assay, we are detecting neutralizing antibodies, again, measured stringently in the 99% level of neutralization against Omicron after 2 doses. And after 3 doses, they're very robust, and they look similar to the kind of immune responses we had in our Phase III trial. So I think this is very promising. Obviously, we're going to be interested. We just started the booster trial. There's going to be some surveillance, that is boosting our subjects from our Phase III trial. So we'll be able to collect some additional data there. As far as other variants, we're keeping all of our options open. I will say we've made very good progress moving from the identification of Omicron. We have now clone-expressed and characterized our nanoparticle vaccine and the key event to sort of trigger the GMP manufacturers to provide the recombinant virus -- baculovirus, which we've done. So we're moving very fast to develop clinical data on Omicron and keeping our options open. It does seem, at this point, very wise to push hard to get Omicron tested in the clinic.

And just -- I mean there's no specific issue with making a bivalent vaccine, so certainly, that's within our power to do. Just in the first instance, we want to go with a string change kind of approach for licensure. And in that case, using a monovalent will just be simpler and faster.

Our next question comes from Charles Duncan with Cantor Fitzgerald.

Stan and team, congratulations on these observations today. I just wanted to maybe follow up on the last question. And that is if you consider the observations from the different assays, do you favor one over any of the others in terms of having predictive value for clinical efficacy? And then I had a follow-up with regard to the adolescent component of PREVENT-19. I'm wondering if you could provide us any observations in terms of safety, particularly myocarditis, or any other safety observations from that cohort.

So let me start off with the assays and then maybe Greg can jump in once again. I think the assays totally different things, right? And that's why, for instance, you saw a big change in the human ACE2 inhibition, and that's because that's where that particular variant holds a lot of its mutations. But we know and we've done this for a while, that we generate immune responses that are neutralizing that aren't specific to the RBD that are in different parts of the spike. And that's why the wild-type neuts are personally my favorite view to look at it. However, the wild-type neuts suffer from having different viruses in each of them. So as far as being comparable between various viruses, that's a bit trickier, whereas, the ACE2 is, in my opinion, probably a bit more robust when you look variant-to-variant. Greg, do you have anything to pitch in on that?

I just would say the anti-spike IgG is unique to our technology because we are -- we're the only group to make a full-length glycoprotein with a transmembrane domain That, in my view, affects the whole structure sort of like a string of pearls. And so I really like seeing that measure because there are different mechanistic contributions to ameliorating or eliminating a covalent disease. And so together, we -- I feel like it's a nice picture to see, and of course, it's more sensitive with anti-spike IgG. So together, we see 2 mechanistic assays and the overall overarching assay immune response to spike. And I think it's really -- it's robust and informative. And I think my prediction, though, at the end of the day, they all have some level of predictive value for protection.

Okay. That's helpful. And Filip...

And as far as your second question -- you have a follow-up with that?

No, please.

As far as the second question about the safety, we haven't discussed safety or efficacy out of the adolescent study. However, you may want to look at the SmPC that was published by the EMA. And there, our ADRs are listed, and there's no cardiac finding, at least in the view of the EMA.

Okay. Great. And then just one quick follow-up regarding the booster study from PREVENT-19. I'm wondering if you've begun to enroll patients or if not, when you intend to? And is there a data milestone in terms of number of patients or something like that? Can you project timing?

Yes. So we started vaccinating a couple of days ago, and more and more sites are coming on board. It's a big study, obviously, so -- and the volunteers, the participants have to agree to enter the boosting portion. So it isn't clear is exactly what the final denominator is going to be. That being said, the vast majority still did continue in the study. They didn't drop out, even those who saw vaccination with emergency use-authorized vaccine. So assuming those people, participants do choose to volunteer, we're going to have the ability to look at a heterologous as well as some homologous boosting in that population. And furthermore, this is designed as an efficacy study, so we are going to be collecting endpoints after boosting. The analysis of that is going to be very tricky because we don't have a comparator group anymore, so we're going to have to do a comparison from within the study, which is going to obviously be confounded by emergence of new variants, and of course, of infection.

[Operator Instructions] Next question comes from Mayank Mamtani with B. Riley.

I appreciate you turning around this data quickly. So just diving a little deeper into the immune response learnings that we have, and obviously, trying to compare that against both the quality and magnitude of responses we have seen from your peers. Can you -- are you able to provide us with the specific for utilizing titles, pre and post booster like you have for the IgG, like you've provided that 70-fold increase? Are you able to provide that on the utilizing titers maybe?

We don't have that data formatted in that way, so no. You just have to compare the tables.

We will try to do that math, looking at that chart. But just maybe if you are able to comment on just high level, at 6 months what you're learning about -- what your boost could do given what you've learned from the primary vaccine series. And as you can imagine, the rationale for my question is getting into the data that we have seen from mRNAs, where there's absolutely no protection at 3 months specific to Omicron despite the boost. So is there anything different that we should expect from the platform that, as you follow along for longer the season -- for subjects that are vaccinated with the booster, with the Novavax booster?

I mean my guess is that we're going to be quite practical about that and get our real-world evidence to get a great feel for that. I just went back to -- while you were asking your question, to see what we did have on the neutralizing titer previous to boost and we didn't actually run those samples. This is a very time-consuming assay and -- to do the wild-type neuts and the SEMs, which will run -- which are the values that I showed you, so we don't have the pre- and post-boost data available. I don't know. I mean, Greg, do you want to speculate? What we do know about our immuno responses are they -- are broader than many. And Stan touched on this before, we know even from our flu data that we're able to induce HAIs against a very broad range of drift strains as well as ancestral strains. And we see this as a strength of the platform. And if you just think back on the efficacy data we showed in the U.S., we had very high levels of efficacy in all the variants which floated around, which are basically drift variants, and complete protection against moderate and severe disease in that study. I mean, Greg, do you have a sense of -- is there a way to guess when we need to apply different doses? I don't think so.

Yes, it's not easy to tell, what you can see from the data Filip showed today is what we have been saying for several years that when you make a spike or a surface protein that is normally antivirus packed in a surface, we present these things in a different way. So we have absolute fidelity. We have, I think, something unique amongst vaccines is, we make the full-length spike protein and we can actually study it. I know we'll be following up on some COVID-specific information, but if you look back at flu we've shown that we have broadly neutralized monoclonal antibodies. We know the epitopes they bind to. We know we make antibodies in humans to these broadly neutralized epitopes, and so these sort of responses are something we can expect based on what we know about our construct and technology. And the beauty of the adjuvant, I think Stan mentioned this, is that this really fans the flame and increases the immune responses to conservative epitopes. And I think that's what's driving these broadly crossed neutralized antibodies. It is pretty interesting to me to see how at the third dose, everything kind of catches up and gets very similar. So I think that's the strength of our technology. We have a lot of good data. I'm sure in the future, we'll present on this phenomenon with more science around the structure and function, but it is an advantage of our technologies. We can actually study that in detail from our vaccine when you take the strength of our technology.

Great. And just if I can squeeze in one follow-up. Do we have data from your Beta variant-specific vaccine? And I'm just thinking, as you think about that multi-variant vaccine construct, it looks like beta does -- the efficacy goes down the most with Beta, and obviously with Omicron. How much does that data play a role in sort of your call on what variant constructs go into that multi-variant vaccine later this year?

Well, some of the key mutations of Beta are in Omicron, right? So I think, again, maybe you can look forward to a Science Day, and we have some real specifics on that. But it's clear we have those epitopes that do make antibodies to them. So to me, this is just again showing how broad the technology is. I think we're seeing Omicron is as far away from the prototype as anything. And we do see some diminution due to that. And that's why we're moving ahead and we're doing this very quickly, I might add, with the Omicron spike protein vaccine. And right now, it's not entirely clear how that might be deployed, but we want to show that we can make it. And this data suggests it's probably wise to try to make it and see how it looks clinically. So I look at -- go ahead.

I guess you just tickled my brain. And a point I'd like to add is after 3 doses, irrespective of the variants we probed, immune responses were very robust. They were quite high. So I -- my sense is that an optimal product may need to include variance. But if you just look back at either the IgG or the human ACE2 following a third dose, this is a pretty very broad immune response, which really is comparable to what we saw in the Phase III studies with 2 doses, again, against the prototype. So I mean, I guess my sense is a little bit. As long as you get a third dose in, you have a high chance of having a good outcome.

At least changes are immune-escape changes. So against that background, I think the vaccine approach is really strong.

This concludes our question-and-answer session. I would like to turn the conference back over to Stan Erck for any closing remarks.

Well, thanks, everybody, for signing on at what is sort of the last minute. But we thought the data were significant enough in this current environment, and we -- this is initial data that we're giving you. We have more data to come. We've got 2 trials starting and look forward to reporting on those throughout as we transition into the new year. So thanks again.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.