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

Thank you for standing by, everyone. My name is Jim, and I'll be your conference operator for today. I would like to welcome everyone to the Novavax Second Quarter 2026 Financial Results and Operational Highlights Conference Call. [Operator Instructions] It's now my pleasure to turn the floor over to Nana Zaman. You may begin.

Good morning, and thank you all for joining us today to discuss our second quarter financial results and operational highlights today on August 6, 2026. A press release announcing our results is available on our website at www.novavax.com, and an audio archive of this conference call will be available on our website later today. Before we begin with prepared remarks, I would like to remind you that this presentation includes forward-looking statements regarding Novavax's current expectations related to, but not limited to, its partnerships, market opportunities and financial guidance. Our actual results may be materially different from such statements as detailed in the presentation. Discussions of non-GAAP figures and reconciliations to GAAP figures are available in our earnings press release and descriptions of the risks and uncertainties associated with Novavax are included in our SEC filings. Both can be accessed through our website. Joining me today are John Jacobs, our President and CEO; Jim Kelly, our Chief Financial Officer; Elaine O'Hara, Chief Strategy Officer; and Dr. Bob Walker, Head of R&D. I would now like to hand the call over to John.

Thanks, Meta, and good morning, everyone. In 2025, we set out to build a different kind of biotechnology company, one powered by partnering our technology, targeted and capital-efficient innovation and a lean and agile operating model. Our ambition is in Novavax with multiple partners and products using our technology, creating both near- and long-term value while potentially having a meaningful impact on millions of lives around the world. Today, the momentum created by executing this new strategy is giving us the potential to have greater impact than ever before. For example, Four of the top 10 global pharmaceutical companies now have licensing or material transfer agreements for Matrix-M. One of those companies is Pfizer in a collaboration that could represent up to $500 million in potential development and commercial milestones and significant potential future royalties. In total, our license partners and MTA holders collectively have the rights to over 30 areas of experimentation across both infectious disease and oncology. The collective utilization and experimentation with Novavax technology potentially opens the door to a substantial portion of a market projected to reach $100 billion in the 2030s, spanning infectious disease, oncology vaccines and cancer immunotherapeutics. In the second quarter, we accelerated our momentum. And today, we're excited to share several important updates. First, we continue to execute well on our Sanofi partnership with Sanofi's strong and growing commitment to Nuvaxovid and our technology. In fact, Sanofi has confirmed to us their intent to be among the first movers in the combination vaccine market and that they are in advanced discussions with regulators regarding Phase III study timing for their program using Nuvaxovid and their own flu vaccines. We're pleased to hear this confirmation, and we are optimistic about the growing potential of our opportunity as partners. Initiation of this trial in either the U.S. will trigger a $125 million milestone payment to Novavax. Additionally, progress continues on the manufacturing tech transfer to Sanofi, which comes with an associated $75 million milestone upon completion and is expected by mid-2027. We believe Sanofi is also well positioned for this commercial season with Nuvaxovid, supported by an expanded U.S. marketing campaign and launches in additional international markets. We're excited for the potential of this work to help increase awareness of Nuvaxovid and build meaningful market share over time. Taken together, this means we now have line of sight to an additional $200 million in potential near-term milestone payments on top of the more than $1 billion in value we have already realized through a combination of upfront payments, milestones and royalties and cost savings related to this partnership. Second, we're seeing growing interest in Matrix-M and increasing progress across our broader partnering portfolio. A growing body of scientific evidence is being generated by Novavax, our partners and MTA collaborators in oncology and infectious disease targets. and we're excited about the progress that's being made. Third, our R&D investments are selective and strategic, and they're designed with 3 goals in mind: to build upon the scientific evidence that makes our technology increasingly compelling to both current and prospective partners, to broaden the utility of our Matrix technology platform and to create new innovative vaccines that have the potential to stimulate additional partnering opportunities and drive value for Novavax and our stakeholders. Later in the call, Bob will discuss the momentum we're seeing across our R&D portfolio, including the growing body of work supporting Matrix-M's utility in oncology. And finally, we're delivering on our commitment to transform Novavax into a leaner, more capital-efficient company. To date, we've reduced our operating expenses by more than 80%, and we remain on track to achieve an approximately 90% reduction from our peak. Importantly, we didn't just cut. We focused, streamlining our company, while at the same time, preserving the capabilities we believe are needed to enable value creation. Taken together, the progress the team and I are sharing today reinforces our belief that the future is bright for Novavax. We continue to successfully execute on and deepen our existing partnerships to take steps towards initiating new partnerships, to strengthen our technology platform and to deliver with financial discipline. We remain confident in the opportunities ahead and believe we're well positioned to create meaningful value for patients and shareholders. I will now turn the call over to Elaine to further discuss the progress we're making across our partnerships and business development activities. Elaine?

Thanks, John. As discussed, one of the clearest indicators that our strategy is working is the momentum we're seeing across our partnerships. We are focused on 2 objectives: maximizing value from our existing collaborations while building the next generation of licensing opportunities. Today, I'll provide an update on both. Beginning with Sanofi. COVID-19 continues to present a meaningful public health challenge, particularly among older adults and other high-risk populations where we see the highest need and the highest vaccination rates. And it remains a significant commercial opportunity as the second biggest infectious disease market behind influenza. Building on last year's COVID-19 launch in the U.S., Sanofi is preparing a broader commercial effort following Nuvaxovid's first full year of approval. The campaign will be supported by pharmacy activation and direct-to-consumer outreach. Internationally, Sanofi plans to expand availability in additional markets this season, including the United Kingdom, Germany and Canada. Results from the Phase IV COMPARE study, a large head-to-head evaluation of Nuvaxovid and a next-generation mRNA COVID-19 vaccine demonstrated Nuvaxovid's favorable tolerability profile. Together, we believe these developments provide health care providers and patients with important information to make more informed vaccine choices. Beyond the commercial COVID opportunity, we remain encouraged by the progress of Sanofi's combined COVID-19 influenza vaccine program. Recent external developments, including the European Commission's approval of the first COVID influenza combination vaccine, reinforced our belief that the regulatory pathway for this category is becoming more clear. As a reminder, Sanofi previously reported positive Phase I/II data for its KIT candidate utilizing Nuvaxovid in combination with their flu vaccines. And as John said, we are encouraged by Sanofi's recent confirmation that they are in advanced discussions with regulators, and they intend to be one of the first movers in the combination vaccine segment. So to reiterate, a Phase III study initiation in either the U.S. or EU will trigger a $125 million milestone payment to Novavax. Finally, on the Sanofi partnership, Sanofi's BARDA-funded H5 pandemic influenza vaccine candidate, which includes Matrix-M, was recently granted U.S. FDA Fast Track designation. So tremendous progress continues with Sanofi. Beyond Sanofi, we're pleased with the continued execution across our broader portfolio of licensed partnerships. Work with Pfizer, Takeda and the Serum Institute continues to progress well and demonstrates the broad applicability of the Matrix-M platform across multiple vaccine programs and of our technology platform more generally across multiple markets. Turning to our Matrix collaboration activity. Today, our existing license partners and NTA holders collectively have the rights to over 30 areas of exploration across both infectious disease and oncology, reflecting the broad applicability of Matrix-M and our technology platform across a diverse range of vaccine programs. While it will take time for partners to complete experiments before these efforts potentially progress into full licensing agreement discussions, we're encouraged by the momentum we're seeing. Materials have been delivered, studies are underway and partner engagement continues to deepen. What stands out most is both the quality and diversity of the organizations evaluating Matrix-M. We are actively collaborating with 4 of the top 10 pharmaceutical companies through license agreements and/or MTAs, and we are also seeing growing interest from innovative biotechnology companies, reinforcing the broad appeal of Matrix-M across the industry. One area where we're seeing particularly strong momentum is oncology. During the second quarter, we executed an MTA with a leading global pharmaceutical company who is also a top player in immuno-oncology related to therapeutic cancer vaccine applications. And we continue to see interest from additional companies in this area. From a partnering perspective, we're encouraged not only by the caliber of these companies, but also at the pace at which therapeutic cancer vaccine programs potentially can generate meaningful data and reach key development milestones. Different to infectious disease vaccines, therapeutic cancer vaccines generally enter clinical testing in patients with active disease, allowing developers to access meaningful data on shorter time lines. Combined with expedited regulatory pathways in areas of high unmet need, we see real potential for these factors to accelerate partnering decisions. Just as importantly, this is an area of profound unmet need, and we are inspired by the hope that next-generation therapeutic cancer vaccines represent for patients and their families. The level of engagement we're seeing reinforces our belief that Matrix has the potential to become a broadly applicable vaccine adjuvant platform. Every new collaboration has the potential to expand scientific evidence supporting the platform, strengthen its value and create additional opportunities for future partnerships. That's the virtuous cycle that we believe will continue to differentiate Novavax. Now I will pass it over to Bob to discuss the scientific rationale behind these programs in greater detail.

Thanks, Elaine. Our R&D strategy is designed around a simple principle. Every investment we make should create future opportunities to facilitate partnership discussions while strengthening the scientific foundation of Matrix-M and our full technology platform. We're increasingly excited about the potential for Matrix in oncology, which we believe represents one of the most compelling long-term opportunities for our adjuvant. Therapeutic cancer vaccines are experiencing renewed momentum as advances in neoantigen discovery, tumor profiling and antigen design accelerate the field. At the same time, many developers continue to face a common challenge of generating strong, durable cellular immune responses that are critical for effective antitumor activity. We believe that our unique sapenin adjuvant Matrix-M has a differentiated tolerability profile and the potential to stimulate robust cellular immune responses for oncology vaccines used alone or with innate immune stimulators such as TLR agonists. A recently published study by Novavax in NPG Vaccines, a Nature Portfolio journal, demonstrated that our Matrix-M adjuvant supports antigen cross-presentation and subsequent downstream CD8 T cell activation. Achieving strong CD8 T cell activation is considered an important factor for many therapeutic cancer vaccine approaches. Additionally, researchers at Stanford have published their work in science advances, showing that saponin adjuvants alone or combined with innate immune stimulators such as TLR agonists can further enhance the magnitude, breadth, durability and quality of immune responses. Put simply, we believe Matrix-M helps the immune system better recognize and respond to disease-related targets. Its ability to engage the innate immune system, activate immune cells within the draining lymph node, enhance antigen presentation and promote Th1 biased and CD8-positive T cell responses gives us a differentiated mechanism of action that we believe is highly relevant for next-generation cancer vaccines. Our own internal research has continued to generate encouraging immunologic data supporting further evaluation of matrix across multiple oncology settings. In parallel, as Elaine discussed earlier, our oncology collaborations should provide additional data sets generated independently by our partners, further expanding our understanding of the platform. Taken together, we believe the combination of published mechanistic evidence, emerging preclinical data and partner-generated research provides an increasingly compelling scientific rationale for Matrix-M in oncology. Beyond oncology, we've continued to advance a focused internal pipeline that addresses significant unmet medical needs while strengthening the value of our platform. During the quarter, we made meaningful progress in the development of our differentiated multivalent C. difficile vaccine candidate, which has the potential to cover the vast majority of circulating C. diff glades and ribotypes. This progress includes initiating GMP manufacturing and pre-IND interactions with the FDA, keeping us on track for potential clinical entry as early as 2027. More broadly, as we have shared previously, some of our own internal preclinical studies on the combination of Matrix-M with licensed flu, RSV and pneumococcal vaccines produced encouraging results that have already helped generate partnership interest. Building on that, we are continuing our comprehensive program to evaluate the potential ability of Matrix-M to enhance performance in a broad array of licensed vaccines in big commercial markets. As we previously shared, our ambition is to generate a library of data in a cost-efficient manner to show the potential of Matrix-M across significant vaccine programs in a methodical manner. And we expect to complete the next tranche of this work by early next year. The goal is to stimulate new and additional partner interest in the applicability of Matrix-M in their vaccine portfolios. Importantly, oncology, C. diff and our clinical and preclinical pipeline exemplify our broader strategy. Every program we advance, whether internally or through our partners, expands the scientific foundation of Matrix-M and our vaccine technology. With the growing partner interest in Matrix-M, we're encouraged by what is today one of the industry's most comprehensive data sets across mechanistic biology, preclinical research, clinical development and commercial use. That growing body of evidence does more than advance our scientific understanding. It increases confidence in the platform while potentially lowering the barrier for future partners and reinforcing what continues to differentiate Matrix-M and our full technology platform. We believe that this expanding scientific foundation represents a durable competitive advantage, one that becomes stronger with every new study, every new collaboration and every new application of the platform. As a physician and researcher who has spent most of his career working on vaccine development, I believe we're entering an exciting new chapter. Seeing the potential of our technology in new infectious disease targets and the expansion of Matrix-M into areas with significant unmet need such as oncology, represents an opportunity to improve the lives of even more patients and make an even greater impact on public health. We look forward to sharing additional progress over the coming quarters. I'll now turn it over to Jim for the finance update.

Thank you, Bob. This morning, we announced our financial results for the second quarter of 2026. Details of our results can be found in our press release issued today and in our Form 10-Q filed with the SEC. Let me begin by highlighting several significant updates that we believe demonstrate the progress we're making on our growth strategy. Today, we are announcing our expectation to earn a $75 million manufacturing tech transfer milestone payment from Sanofi mid next year that would extend our current cash runway from 2028 into 2029. We are also encouraged by Sanofi's recent Phase III KICK study update discussed earlier and the potential to earn $125 million milestone payment. In addition to our second quarter results, we will be sharing updates on our improved 2026 financial outlook and reiterate our financial performance objectives to drive shareholder value. First, I'll walk us through our revenue performance. Our second quarter total revenue of $57 million compares to $239 million in the prior year. When comparing year-over-year results, you will see the prior year second quarter 2025 results include a $202 million benefit from a combination of a BLA approval milestone payment and a Takeda amendment. The $57 million total revenue recorded in the second quarter of 2026 includes product sales of $19 million, an increase of 76% year-over-year and are driven by demand for our Matrix-M adjuvant by Takeda and Serum Institute. In addition, we recorded Sanofi revenue of $36 million related primarily to R&D cost reimbursements and amortization. Turning to our full financial statement results. The second quarter of 2026, we recorded a net loss of $53 million and ended the quarter with $743 million in cash and accounts receivables. When reviewing the year-over-year change in net income and loss, we begin with the impact of the prior year's BLA milestone in Takeda amendment. Our second quarter 2026 results highlight meaningful improvements to other aspects of our financial performance, including product sales and other partner-related revenue categories that increased by $20 million year-over-year, while cost reductions were the primary driver of an additional $24 million improvement. We believe these 2026 trends reflect the continued execution of our strategy and financial performance. On the expense front, we continue to reduce our cost structure in the second quarter of 2026 with a 36% decrease to combined R&D and SG&A expenses on a non-GAAP basis. Importantly, we made significant reductions to both R&D and SG&A spend profiles. We believe these improvements to our operating efficiency highlight that we are on track to deliver our full year expense guidance. Today, we are increasing our full year 2026 revenue framework and expect to achieve adjusted total revenues of between $235 million and $275 million. As a reminder, our non-GAAP adjusted total revenue excludes Sanofi supply sales, royalties and milestones. This means there may be revenues in 2026 that are additive to our expectations. That said, we believe in 2026, Nuvaxovid royalties will grow significantly as compared to 2025. At midpoint, our full year 2026 revenue framework for adjusted total revenues is $255 million. This increase of $5 million at midpoint relates to the following updates for 2026: a $5 million increase to adjusted supply sales as we see strong demand from Matrix-M from our commercial partners; a $10 million increase to other partner-related revenues as we see -- as we expect additional royalties and milestones from Takeda and Serum Institute. And finally, a $10 million reduction to partner R&D reimbursements as we deliver efficiently on our partner-related performance obligations. Looking ahead to the second half of 2026, we expect the majority of our remaining revenue to occur in the fourth quarter as driven by the COVID-19 vaccine season. Today, we are also improving our full year 2026 combined GAAP R&D and SG&A expense guidance. At midpoint, we expect to achieve results of $390 million, a $10 million reduction and improvement to our prior guidance. On a non-GAAP basis and net of partner reimbursements, we reiterate that we expect to achieve results of $325 million at midpoint. Today, we are reiterating our 3-year combined non-GAAP R&D and SG&A expense guidance. Looking forward to 2028, we expect to reduce our non-GAAP R&D and SG&A expenses by over $200 million, reflecting a 50% decrease when compared to 2025. Importantly, in 2026, we are already operating at an approximately $200 million core spend profile when excluding costs tied to completion of partner and APA performance obligations. As these near-term activities are completed, we expect to be in a position to further decrease these costs. To reach our 2028 lean and agile operating model target, we anticipate having less than half the headcount as compared to the first quarter of 2026 and are exploring an over 50% reduction to our operating footprint via consolidation of buildings and laboratories. This could result in a noncash fixed asset write-off of up to $35 million in 2027 in addition to our existing expense guidance. As a reminder, in 2025, we recorded noncash write-offs of $98 million to a separate P&L line item called impairment of assets held for sale. For the time being, we suggest analysts and investors use the same P&L line item as part of their forward-looking models until we refine our expectations for both the amount and accounting for these potential noncash write-offs in 2027. Today, we are reaffirming our key financial objectives that support our intent to drive long-term shareholder value. Our strategy is to drive revenue from a diversified set of licensed partners and products to deliver long-term cash flow growth. To enable this strategy, we are making disciplined R&D investments that strengthen the Matrix platform, advance differentiated R&D programs and generate data to support new partnering opportunities. When Novavax engages with new partners, we expand investments in R&D via partner funding of new vaccine programs. Key financial metrics to support our growth strategy include: achieve 2028 combined non-GAAP R&D and SG&A expense of $150 million to $200 million, reach non-GAAP P&L profitability as early as 2028, pay off pandemic era EPA liabilities by the first quarter of 2029. -- and maintain at least 2 years cash runway. As a reminder, the timing of the Sanofi KI launch is a primary contributor to our potential non-GAAP profitability. We look forward to sharing additional updates as we improve Novavax's financial performance, cost structure and strength to deliver shareholder value. With that, I'd like to turn the call back over to John for some closing remarks.

Thank you, Jim. In closing, we're excited about the momentum we continue to build across our business. We've transformed Novavax into a leaner, more focused company, strengthening our balance sheet and continue to execute against our corporate strategy. Matrix-M continues to gain scientific and commercial validation, and we're seeing sustained interest from both existing and prospective partners. At the same time, we're advancing a focused internal pipeline and are excited about the potential of our C. diff vaccine candidate. We believe this reinforces that our future has the potential to be less reliant on any single product, program or partner as we continue to diversify revenue-generating opportunities. While there is still important work ahead, we believe we have more visibility into our future opportunity than at any point since beginning Novavax's transformation. We're confident that our strategy is sound, and we're accelerating our momentum, positioning the company well to enable meaningful value creation for years to come. And importantly, as we continue to execute, we are creating the potential to have a remarkable impact on public health and a legacy we can all be proud of as employees and contributors to this journey. We would all like to thank our employees for their efforts and our shareholders for their belief in our company. And with that, operator, we'd be happy to open the line for questions. Thank you.

[Operator Instructions] we will hear first today from the line of Roger Song at Jefferies.

Congratulations on the progress. This is Nabeel on for Roger. Lots of exciting progress in the commercial engine, the partnerships in the pipeline. So I guess maybe 2 questions. First, as we look at Sanofi entering its first commercial season, curious if you can give any more color on the seasonal supply. And then on Sanofi and the Phase III advanced discussions on the combo, what needs to be aligned for that Phase III? And then again, if you could just talk about that market opportunity, especially you mentioned international as well.

Jim, why don't you take the first part of the question on the upcoming season?

Yes, absolutely. Nabeel, thanks for the question. We continue to see the COVID marketplace as just an incredibly significant vaccine marketplace opportunity. A reminder, this is a top 5 global vaccine market. It's been in the $5 billion to $7 billion the last few years. As we look forward, I think that the entrant of our partner, Sanofi, who, as you know, is the market leader in the enhanced flu marketplace blue being the anchor to the respiratory season, we're really looking forward to what they're doing to bring a protein-based option to the marketplace, both in the U.S. and globally. So of course, we can't speak for our partner, Sanofi, but we're seeing through really their actions, investing in things like the COMPARE study we discussed last quarter, where they went head-to-head with mRNA and showed the very favorable profile of Nuvaxovid protein-based with respect to adverse events, reactogenicity. So we're really happy and looking forward to seeing their impact of their commercial consumer -- direct-to-consumer program to roll it out this year.

Thank you, Jim. And like Jim said, they're leaning in, not away regarding Sanofi as our partner. Outstanding partnership, positive energy there. And in the case of KI, though we can't speak on behalf of our partners on specifics, actually, we don't -- we can't have the specifics on the background on their R&D program and other things. We're technically a competitor in the KI arena because of our own vaccine asset there. But in this case, Sanofi has confirmed with us their intent to be among the first movers in the combination vaccine market arena and that they are in advanced discussions with regulators regarding Phase III study timing for a combination vaccine program. Very encouraging, very exciting and building upon the news from Moderna yesterday evening on the approval for their flu vaccine. We see that as a positive momentum in the U.S. environment from a regulatory perspective for seasonal infectious disease arena.

We will take our next question from the line of Paul Kohn at TD Cowen.

Congrats on the quarter, guys. Paul Kohn here on for Trace. So I just wondering if you guys could provide any additional color on your potential clinical trial design for C. diff vaccine in Phase I, primarily what endpoints are you guys going to be looking at? And what do you want to see there before initiating a Phase III trial? And then just curious if you guys have embedded any potential Phase II or III C. diff costs in your 2028 operating expense framework.

Bob, why don't you take the first part of the question on trial design commentary? And then, Jim, you can talk about the runway on costs.

Sure. So for the Phase I trial design, we're not really discussing details of that, but I would just say that it's a fairly standard dose escalation safety, characterizing safety. and demonstrating that the safety profile is adequate to take further into advanced development.

And Bob, to that point, as we look at advanced development, which certainly could be as early as 2028, the answer to funding capacity is yes, we have contemplated the ability to keep programs, exciting programs like C. diff moving in our forward-looking guidance.

And that's exactly, Jim, why we provided a range in that forward-looking guidance on expenses, but we're contemplating within that range and to operate the company within the range that's been provided. That's our intention.

Next question will come from Pete Stavropoulos at Cantor Fitzgerald.

On the progress. First question that I have is this will be a full commercial year for Nuvaxovid under Sanofi control, as you mentioned. How much of the 2026 COVID vaccine uptake assumptions depends on contract wins versus physician patient-driven uptake, including the DTC outreach that was mentioned...

Jim, do you want to take that one?

Certainly. V very astute question about the marketplace dynamics. This continues to be a consumer and retail-driven marketplace in the U.S. in particular. We're looking at 85% or more of decision-making or shots coming through the retail market. And this is why this direct-to-consumer advertising by Sanofi this year, emphasizing not just exceptional efficacy, but also great tolerability profile, we think, is exceptionally important. As we watch the way Sanofi has built their market-leading flu vaccine business, we've witnessed the following: one, they invest in data. It's a long game. They're methodical. And so that's what we're anticipating from them. We saw it in sort of them testing the marketplace last year, investing in the compare data, now rolling out their direct-to-consumer. And so that's our anticipation. This is a multiyear, long game. We look forward to seeing what they're going to do this fall, but importantly, bring a protein-based vaccine to the market in a meaningful way.

All right. And just one additional question. Sorry, John, do you want to say something?

Just to build on that, they're also -- though the U.S. is the most important market, it's primary market. They're also launching in other markets this year like Canada, Germany, United Kingdom, and it will be a global footprint over time that continues to expand. And like Jim said, long-term methodical investments. And Elaine, you had one additional point to add.

Yes. Just more specifically, Pete, they've contracted with all the major retailers in the U.S. And so we expect to have a robust season as a result of that. So thanks.

All right. And just one question probably for Bob. It has to do with the C. diff vaccine candidate. One of the design attributes you have alluded to is the possibility of mucosal immunity. Just curious to hear what from the preclinical data sort of gives you confidence that you would be able to develop mucosal immunity, which I assume is IgA response. And -- and are you developing this candidate as an injection? And the reason I ask is what gives you confidence again that you can generate a robust mucosal response with that route of administration?

So yes, one of the things we're looking at preclinically and we intend to look at in the clinic is whether or not the vaccine can induce mucosal immunity. As I mentioned on the last earnings call, we do see evidence of that in some of the preclinical models, but preclinical models are limited, as you know. So when we see it in our human studies, I think we'll talk about it more if we see it in human studies.

Our next question will come from Alex Stranahan at Bank of America.

Two from me. First, just on the 2026 revenue guidance, is there a point in the fall season where you'll have better line of sight on Sanofi supply sales where you provide concrete guidance here? Or will this maybe be easier to do next year after we get a full year of Sanofi commercialization? And second, has strain selection happened for Nuvaxid yet? What the appropriate variant match will be for this fall, whether that's XFG or something else? And thoughts around preparedness to scale manufacturing for this season's strain would be great.

Maybe to take the question on guidance.

Certainly. I would start by reiterating that we are exceptionally excited to have Sanofi as our commercial partner with Nuvaxovid. We're not in a position, however, to guide for them. And it's also true that we're not able to speak to -- for them on strain selection. What we can say is as this year is our final year of offering commercial support directly to Sanofi, they're well prepared. they're well prepared to be out there in line with the competitors at the start of the season and do what they do best, right, bring important vaccines to the marketplace. Regarding your question about, hey, in the future, might we guide to Sanofi. We haven't guided to anything beyond 2026 at this time. But importantly, we, I believe, have set a precedent that we're not at this point in a position to speak on their behalf. But as they, over time, begin to guide, of course, I think that's going to be helpful to all investors.

And then, Alec, your second question was on strain selection. If I would paraphrase the question or just frame it a little differently, do we have the correct strain and a vaccine that's viable for the season, Bob?

Yes. The vaccine that Sanofi will be distributing in the U.S. and beyond is -- matches the strain selection of the U.S. and other regulators.