Vaxart, Inc. (VXRT) Earnings Call Transcript & Summary

Greetings and welcome to the Vaxart monovalent norovirus challenge study top line results conference call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the webcast over to your host, Ed Berg, Senior Vice President and General Counsel.

Good afternoon and welcome to today's call. Joining us from Vaxart are Andrei Floroiu, Chief Executive Officer; Dr. Sean Tucker, Founder and Chief Scientific Officer; and Dr. James Cummings, Chief Medical Officer. Before we get started, I would like to remind everyone that, during this conference call, Vaxart may make forward-looking statements, including statements about the company's financial results; financial guidance; its future business strategies and operations; and its product development and regulatory progress, including statements about its ongoing or planned clinical trials. Actual results could differ materially from those discussed in these forward-looking statements due to a number of important factors, including uncertainty inherent in the clinical development and regulatory process and other risks described in the Risk Factors section of Vaxart's most recently filed annual report on Form 10-K and other periodic reports filed with the SEC. Vaxart undertakes no obligation to update any forward-looking statements after the date of this call. I'll now turn the call over to Andrei Floroiu. Andrei?

Thank you, Ed. And thank you to all of you joining us today. We are pleased to share with you the top line results from the challenge study of our monovalent norovirus oral tablet vaccine candidate. I'll preface my remarks by reminding you that this challenge study was not intended as a registrational study but rather was designed to provide insights into important efficacy and immune response end points that will inform the next steps in the development of our norovirus vaccine program. As indicated in the press release that we issued earlier today, the study met 5 of its 6 primary end points and demonstrated a very favorable safety profile that was consistent with what -- with that observed in prior trials of our other vaccine candidates. Importantly, these results also show a very substantial reduction in viral shedding in the vaccinated cohort compared with placebo, which was a prespecified study end point. As James will discuss, this could have an impact on transmission, and they have important public health benefits. The key takeaways from this study are that our monovalent vaccine candidate has the potential to reduce rates of norovirus infection, acute gastroenteritis and viral shedding; and stimulates norovirus-specific antibody responses and neutralizing antibodies. We believe these data support the potential of our oral tablet norovirus vaccine program and add to the growing body of evidence validating our oral vaccine technology platform. During today's call, James will review the top line results from the challenge study and discuss next steps in the development of our norovirus vaccine program, but before I turn over -- the call over to James, I'd like to remind you that norovirus is both a significant health challenge and a compelling market opportunity. Norovirus is the leading cause of acute viral gastroenteritis or AGE in all age groups in the U.S., and there are no approved vaccines against norovirus. Therefore, in the U.S. alone, the annual disease burden from norovirus is over $10 billion. And that's every year. As on average, norovirus causes between 19 million and 21 million cases of AGE; infects 15% of all children under the age of 5; and leads to 465,000 emergency department visits, 109,000 hospitalizations and 900 deaths annually. Now I'd like to turn the call over to James for a review of the top line challenge results. James?

Thanks, Andrei. As stated in this afternoon's press release, this challenge study of our monovalent norovirus vaccine candidate met 5 of its 6 predefined primary end points as well as the prespecified end point of reduction in viral shedding and demonstrated a favorable safety profile consistent with that observed in prior trials of our other vaccine candidates. Today, I'll review the top line results for each of these end points. As Andrei noted, we will be doing additional analyses of these data in the weeks ahead, both within with our own team and in consultation with external experts, in order to identify the best pathway forward for this program. Next slide. Next slide. Let me begin with a review of the design of the study, which was a double-blind, randomized, placebo-controlled study in which healthy volunteers received a single oral dose of our norovirus vaccine candidate, targeting the GI.1 strain of norovirus, or placebo on day 1. On days 29 and 30, participants were challenged with the GI.1 strain of norovirus; and then assessed for infection, norovirus AGE and immune responses through day 57. Next slide. The objectives and end points of the study are summarized as follows. The primary objectives were to determine the clinical efficacy of our monovalent norovirus vaccine candidate, compared to placebo, to protect against norovirus acute gastroenteritis or AGE caused by the Norwalk strain of norovirus challenge inoculum; and to evaluate the VP1-specific antibody-secreting cells or ASCs, HBGA-blocking antibody and VP1-specific serum IgG responses to the vaccine. The primary end points were as follows: one, the rate of norovirus infection post vaccine and post challenge; two, the rate of clinical norovirus acute gastroenteritis; three, induction of VP1-specific immunoglobulin A antibody-secreting cells at day 8 compared to placebo; four, the histo-blood group antigen- or HBGA-blocking antibodies by blockade titer or BT50 at day 28 compared to placebo; five, the VP1 serum immunoglobulin C (sic) [ G ], IgG, at day 28 compared to placebo; and six, the VP1-specific serum immunoglobulin A or IgA at day 28 compared to placebo. A reduction in viral shedding was also a prespecified end point. The study also assessed the safety of our monovalent norovirus oral tablet vaccine candidate, so let's take a look at each of these end points one at a time. Next slide. Consistent with our prior trials of norovirus vaccine candidates and other candidates from our oral tablet platform, no vaccine-related serious adverse events, nor vaccine-related solicited grade 3 adverse events, were reported in this challenge study. Please move forward 2 slides. There was a statistical significant 29% reduction in the rate of infection in the vaccinated cohort compared with placebo. That's 82% versus 58%. This reduction was highly significant with a p-value of 0.003. Next slide. With respect to the rates of norovirus acute gastroenteritis, there was a 21% reduction in the rate of norovirus acute gastroenteritis in the vaccinated cohort compared with placebo, 45% compared with 57%, but this did not meet statistical significance. Next slide. And I think our slides are lagging a bit, but in the next slide that you'll see, the vaccine arm shows an 85% decrease in viral shedding compared with the placebo arm. This could have important public health implications, as reduced shedding may result in reduced rates of transmission. Norovirus is highly contagious, so the ability to reduce transmission would be beneficial, especially in close-contact congregate settings where norovirus outbreaks can spread rapidly such as cruise and military ships, nursing homes, daycare centers and homes. Next slide. There was a significant increase in the induction of norovirus-specific immunoglobulin A ASCs in the vaccinated cohort with a 79% response compared with 2.5% in the placebo cohort. Next slide, please. On day 8 post vaccination, there was a mean response of 375 ASCs per million cells in the vaccinated cohort compared with 26 ASCs per million cells in the placebo cohort. The p-value for that was less than 0.001. Next slide, please. Next slide, please. We also saw a significant increase in the induction of HBGA-blocking antibodies in the vaccinated cohort with a geometric mean fold rise or GMFR of 3.23 compared with a GMFR of 1.0 on the placebo cohort on day 29 post vaccination. That p-value was less than 0.001. Next slide, please. There was also a significant increase in serum IgA norovirus antibodies, with a GMFR of 7.14 in norovirus-specific serum IgA in the vaccinated cohort compared with the placebo from baseline to day 29 post vaccination. That p-value was less than 0.001. Next slide, please. A similar response was seen with respect to norovirus serum IgG antibodies, with a GMFR of 4.64 in norovirus-specific serum IgG in the vaccinated cohort compared with placebo from baseline to day 29 post vaccination. On the next slide, you'll see these results were highly statistically significant with a p-value of less than 0.001. Next slide, please. On the following slides -- next slide, please. We saw a significant difference favoring the vaccine cohort in mucosal immune responses at day 8 and day 28 post vaccination. Next slide, please. Taken together, these immune response data show that our oral tablet vaccine candidate stimulates potent and specific antibody responses against norovirus challenge strain. Next slide, please. So what do these results tell us? And how do they inform the next steps in our norovirus development program? Next slide, please. As Andrei noted, we believe that the reduction in the rate of infection, increases in norovirus-specific antibody responses and neutralizing antibodies and the reduction in viral shedding in this challenge study support the potential for our norovirus vaccine program to provide significant public health benefit. It may also reduce norovirus acute gastroenteritis, and we are continuing to analyze the data to more fully understand this. These are important findings that support the potential utility of our oral tablet vaccine technology in enabling a vaccine for norovirus, a serious public health challenge for which there is currently no vaccine. With respect to the rate of norovirus acute gastroenteritis, we saw a numeric decrease in the vaccine cohort compared to placebo. While not statistically significant, we are encouraged by this result, especially given the high dose of challenge virus used in this study compared with what could occur in natural infection. Additional analyses may provide more information regarding the effect of our vaccine on the rate of norovirus acute gastroenteritis and help us to optimize future studies of our norovirus program for success. In addition, a real-world study may demonstrate higher efficacy rates on the norovirus acute gastroenteritis end point as well as other important end points. In terms of next steps in our norovirus vaccine program, it's also important to consider data from the Phase II dose-ranging study of our bivalent candidate. As we reported in July, preliminary results of that trial showed robust serum immune responses across all doses at day 29 relative to day 1. Both doses showed a similar increase in serum antibody responses, with no statistical difference between the medium- and high-dose arms. At day 29, increases in serum IgA, IgG and BT50 for both the GII.4 and GI.1 strains in the vaccine arms were similar to those seen in previous norovirus studies conducted by Vaxart. Based on the totality of the data to date, we intend to focus on advancing our bivalent vaccine candidate. We believe that this candidate could provide a significant benefit because it targets the 2 most prevalent strains of norovirus that infect humans. We are currently conducting additional analyses of the data from this challenge study and our prior -- previous norovirus trials in determining the next steps for the norovirus program, which could include conducting a Phase IIb dose confirmation study of our bivalent candidate. We continue to look for a correlate of protection, which has the potential to substantially reduce the size and duration of a Phase III registration study. Thank you for your attention. And I'll now turn the call back to Andrei for closing remarks. Andrei?

Thank you, James. We are very excited by these data and believe that they add to the body of evidence supporting the potential utility of our norovirus vaccine program. Given both the substantial market opportunity and the significant unmet need for a safe and effective norovirus vaccine, our norovirus program remains a priority. As we've noted, our decision with regard to the timing and design of a Phase IIb dose confirmation study will be made after additional analyses of the data and discussions with regulatory agencies. We believe that a shelf-stable oral tablet vaccine for norovirus could have significant public health benefits in reducing transmission of norovirus, which is highly contagious, while protecting against norovirus infection and norovirus-caused AGE. This vaccine candidate could also capture a substantial portion of the anticipated market for a safe and effective norovirus vaccine, which would create significant value for our shareholders. In closing. On behalf of the Vaxart leadership team, I'd like to thank you for your time today. We are now happy to take your questions.

[Operator Instructions] Our first question comes from Charles Duncan with Cantor Fitzgerald.

Congrats on today's provocative infection rate data. I did have a few questions, so I'll try to get through them quickly, okay? First of all, with regard to the rate of infection, the 29% reduction through day 8 post challenge, can you give us some context as to the magnitude of benefit, the clinical benefit, on that? And then if you could provide a little more color on the 21% reduction in AGE. I guess I'm wondering if you would have liked to see higher. Or is that just simply result of some outliers or something that you could power up with a little bit larger study and get to a meaningful clinical benefit?

Thanks, Charles. Andrei, I'll take the first question, [ if that's okay ].

Definitely, [ James, yes, yes ].

This is James Cummings, the CMO. So in terms of the rate of infection being 29% with a significant p-value of -- or rather decrease in infection of 29% with a significant p-value of 0.003, the magnitude of that benefit is -- could be severalfold. And again this is an artificial setup of a challenge study, right, using an inoculum that is generally a lot higher than one would see in the natural setting, in the real-world setting, but the 29% rate of infection certainly decreases the chance of transmitting virus to others. And I would fold into that the decrease in viral shedding as well, that area under the curve of a decrease of 85%. That may also decrease transmission in those close-contact environments that we talked about, so I think -- that's to me the two-pronged benefit of those findings. In terms of the reduction of AGE, we saw 21% in this study. And as I mentioned, it didn't show statistical power that we were looking for, but it did have 21%, so a numerical benefit. And I think that, that also is part and parcel to the fact that this is small numbers in a artificial challenge model. One would project that -- as you go to a real-world study, an efficacy study in the field, that the efficacy should increase, where the challenge by virus in a standard exposure could be really down to less than a few copies of virus, as this is a very contagious, infectious agent.

Yes, that makes a lot of sense to me. And then if you could talk a little bit about the next steps. James, you mentioned the focus being the bivalent, but then Andrei, you mentioned the monovalent and possible next steps, so could you clarify whether or not there'll be continued investment in the monovalent form and when we could see a Phase IIb study design emerge? And then if not, when do you expect next steps with the bivalent form?

Sure. So I'll take first crack and then I'll turn it back over to Andrei for further commentary. So certainly the bivalent form is important from our standpoint because it covers not just the GI.1 strain but also the GII.4 strain. And GII.4 is currently the -- more commonly the cause of infectious norovirus circulating in the community, but those 2 represent the lion's share of what causes disease [ in humans ]. So the bivalent is, I think, the product we're looking forward. And that's one of the reasons, Charles, why I mentioned our norovirus [ 202 ] study. We saw some, I think, very compelling data on immunogenicity that showed the medium dose and the high dose had virtually from a statistical standpoint the same immunology readouts. And so I think that knowing that our vaccine does not appear to inhibit one strain versus the other when given concomitantly means that we have a chance to protect against the 2 most frequent strains. In terms of next steps, I think the IIb safety study is the next steps clearly on trajectory for a pathway for approval of this vaccine. And so we would increase the overall safety numbers to have an end-of-Phase II meeting with the FDA. I think that that's another piece I'll point back to on the data that you just received -- and regrets on the slides lagging a bit, but our safety data, with no vaccine SAEs, no vaccine grade 3 AEs, maintains its fairly clean and very well-tolerated profile in terms of tolerability and safety, so I -- again I think that a Phase IIb for safety standards should go very clearly forward. Another thing that we would look for that I just touched on was looking at potential correlates of protection. And we find that, we feel that that's fairly an important piece to try and tease out, as that may impact a Phase III study design. In terms of the timing of a Phase IIb, I'll turn that over to Andrei for particulars. Andrei?

Thank you, James. So a few things, Charles, here to add to what James said. So first, the Phase IIb study, the precise timing of that, as we said, we'll announce that, hopefully, in not too long a time, informed by the additional analyses that are now ongoing, but we are still on track to have a end-of-Phase IIb -- end-of-Phase II meeting with the FDA at the end of next year, as we've announced previously. Now with regards to the bivalent vaccine candidate, that has always been our goal. It remains our goal. It's just that this challenge study was a monovalent challenge study given that the challenge was just with GI.1. However, it's important to note that again -- and we wanted to emphasize, is that our focus and the final intended product is a bivalent vaccine candidate because GII.4 is actually responsible for a majority, a large majority, of the infections, often over 70%. And what's interesting with our construct is that we've seen that our GII.4 vaccine candidate is more immunogenic than our GI.1 vaccine candidate. So this is the second reason for which we believe that in a real-world study the protective efficacy against AGE is going to be higher, potentially significantly higher, than what we have seen in a GI.1 challenge study. Additionally I think it's very important to look at the attributes of our vaccine candidate together, right? So the reduction in infection rates, which you noted, but particularly the significant reduction in shedding is -- that significant reduction in shedding indeed translates into a material reduction in transmissions. You can see how in a real-world setting that would automatically lead to a potentially large decrease in AGE. So that's why we are very excited about the totality of this data. I hope this answers your question, but let me know if it doesn't.

Yes, I think it does. I guess the remaining question I have is for the GII.4 bivalent candidate. Do you plan to conduct a similar challenge study? Or do you think that you'll be able to hop right into a Phase IIb with that candidate?

I'll take...

James...

Yes, yes. So Charles, I don't think it's a sequential operation along with the Phase IIb which would be with the bivalent product, right? We'll take a look at further analysis to see if we need to get more data on the correlates of protection and take a look at a GII.4 challenge. Upon further review of the data, we may have compelling information that would suggest a correlate of protection. And through dialogues with regulatory agencies, we would look to learn if further evaluation and additional challenge could be helpful or necessary in determining the correlate of protection for shaping what that Phase III study would be. The second follow-on to that, and it's an answer to a portion of your previous question, Charles: Another, I think, look at preliminary efficacy in the Phase IIb but clearly in the Phase III is taking a look at the impact of that decrease in shedding and decrease in infection and what that might have for transmission. I think that could be built into a larger real-world study as well.

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

Congrats on these results. So maybe just on that last point around immunological data. Certainly it looks quite good, consistent with prior studies and perhaps even better than the COVID construct. Could you just comment on your thoughts on whether a particular correlate of protection stands out to you? I see you present the IgA data in 2 different ways on Slide 9 and 13. Could you just maybe explain the implications of both and what additional analysis you may have in the works that allows you to be better informed about any FDA correspondence you may be looking to have with the Phase IIb also being planned in parallel and you just commented?

Sean, maybe you want to start answering the questions on the [ immunology ].

Sure, yes, yes. I mean obviously it's still early days, but I'm very confident we're going to be able to identify potential immune correlates of protection. And again, as I mentioned before, we're still looking through the data on subject-by-subject basis, but I can tell you the subjects that had better immune responses had better outcomes. And again part of it is going through the rigorous statistical analysis to find what the best correlates are for protection against AGE, shedding and infection; and we'll do that. And I'm -- I like I said, I'm very confident, given the data we have, we're going to be able to -- we'll be able to identify potential immune correlates.

Got it. And maybe a similar sort of question on the AGE data set. Have you broken out the kinds of events, like vomiting, diarrhea? So like are there any differences that, for example, you've seen in other studies that could be informative of future development [ around impact on severe illness ]?

Yes, I'll take that, Andrei. So in this current study, we didn't see statistical difference in that severity, but that's at the 10,000-foot view in, again, a small-numbered study. What we'd like to do is parse the data by subjects, taking a look at those different parameters of severity, et cetera and duration; and then also, I think, Mayank, in taking a look at a real-world study, taking a look at what actual [ naturally ] occurring infection and disease severity may be. So that's a part for the follow-on as well.

Okay, got it. And maybe final question, in terms of a particular forum that you may look to present this data and kind of what we should be expecting to hear from you as next steps. Would you look to earnings call to sort of present this additional analysis? Would you be at a conference? Or maybe even how this may be socialized externally with potential strategic partners. Just curious on what more color we can get as part of the next steps.

I'll turn the full answer over to Andrei, but we will be presenting at the World Vaccine Congress in Europe, in Barcelona, in October. And one of the things we'll be presenting on, of course, is our norovirus vaccine candidate. And we'll look to have a full presentation at that time. Andrei, do you want to answer the other questions in terms of presentation of data as things roll out?

Yes. Well -- so this will be a joint decision depending on when we finish these analyses. And Mayank, we are looking at the usual ways of disseminating these data. As James mentioned, conferences is one; maybe some publications or investor calls, so we'll give everyone the heads-up when we're ready to share more details.

Our next question comes from Roger Song with Jefferies.

Excellent. Congrats for the data. A couple of ones: That is the first one is maybe, James, you can help us to conceptualize how these challenge efficacy data will translate into field or real-world efficacy data based on the [ precedents ] and your understanding of the difference of the viral load. And I think you mentioned something may -- can be multiple fold. Maybe just give us a little bit more detailed specifics around the challenge efficacy versus the field efficacy.

Sure. Thanks, Roger. So in the artificial challenge that we use the challenge model, we use lots of copies of virus to ensure a high infection rate. In nature, 10 to 15 copies of virus is generally enough to give susceptible -- certain susceptible individuals disease, right? And so what generally happens, and this is across vaccinology, most often is, after a very robust and stringent challenge as we've seen here, field efficacy generally goes up because the amount of inoculum that is causing disease that would be seen in the field is far lower than what is seen in the challenge study. So my projection is that we would see an improvement in the decrease of AGE with our vaccine. And a field study will show that. I think also looking at those potential correlates as we work towards that end will be very helpful in making that linkage. The second piece is I think, the benefit of a field study, it will be possible to take a look at transmission, the impact of transmission that this vaccine candidate may have. As we've seen, it clearly suppresses viral shedding; and has an impact, a statistically significant impact, on infection rates even with this very robust challenge inoculum that we see in our challenge model today.

Yes. That makes sense. And then you kind of alluded that you may or may not do the bivalent II.4 challenge study. I'm just curious. You mentioned something like your II.4 immunogenicity is higher than I.1. Outside of that, what will give you the confidence your bivalent challenger -- challenge study efficacy may be better than the I.1?

So I think the reason to move forward into the GII.4 challenge, which is a different strain, is that it would be confirmational for correlates of protection that could be seen in the GI.1 strain that we've seen here. We do have very robust immune responses to the GII.4 strain in our vaccine construct both in the bivalent as well as in the monovalent strain, so looking at, if that is the indicator of potential protection, then that would then follow, but proof is in the pudding. I'd love to take this either to a challenge model or, more importantly, to the field to take a look at protective efficacy in the natural setting.

Got it, yes. Maybe just a very quick clarification: For the potential II.4 challenge study, it will be your bivalent.

That is correct. Our bivalent product would be the product that we are moving forward with in development. And just a reminder: We didn't see any decrements -- a statistical decrement or suppression of immune response in that -- in GII.4 when given concomitantly with GI.1.

Yes, because moving forward, your bivalent will be the key vaccine in development, including the Phase IIb safety study.

I think so.

Yes, awesome. Maybe just last one -- yes. Go ahead.

Yes. I mean, Roger -- so just on this question. I want to make sure. I know that, monovalent and bivalent, going back and forth between the two may be a bit confusing. So Vaxart many years ago started the development of its norovirus vaccine with, first, a monovalent GI.1 candidate, but the thought has always been that the product that we will take for approval and commercial version would be a bivalent. And so we have conducted in the past a bivalent interference study. And then as you recall, early this year, we started and then we put out the data from our dose-ranging study which was also bivalent. So nothing has changed, right, but I just want to make sure that everybody understands that our thought has always been to develop this as a bivalent vaccine. And that remains so.

Yes, yes. I think that's my understanding. I just want to confirm. Moving forward, everything will be bivalent, to Phase IIb and the potential challenge study and, of course, the pivotal Phase III.

Correct, correct.

Okay, yes. And so maybe just last one. Given this data and together with the bivalent immunogenicity data you reported earlier -- maybe a little bit provocative. So what will be the potential Phase III design and the vaccine profile given you do have this viral shedding kind of benefit and the potentially immunogenicity correlates in AI -- AGE and infection. So what will be the potential primary end point for the Phase III maybe better to capture the full picture of your bivalent vaccine?

Thanks, Roger. So I think certainly protection from norovirus AGE is something we look at, right? And protection from infection of norovirus is something that we look at. What I'd like to see in a Phase III is -- and this is preliminary, of course, because we will build that Phase III in concert with consultation with the regulatory agencies, right, but I'd like to take a look at that viral shedding and the impact that it might have on disease transmission because I think that's another potential differentiator of this new [ coastal ] strategy, is the potential impact it has on disease transmission. That's something that I think we would add to potentially [ and ] profile with the right study design, perhaps looking at those outcomes, again under the auspices of discussion with regulatory agencies in its active design. And don't forget we are still looking at the potential impact of correlates of immunity and what that might have on the Phase III design as well.

Thank you. There are no further questions at this time. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.