Novavax (NVAX) 9 Nov 232023 Q3 Earnings call transcript

Ladies and gentlemen, thank you for standing by, and welcome to the Novavax Third Quarter 2023 Financial Results and Operational Highlights Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Erica Schultz.

You may begin.

Good morning, and thank you all for joining us today to discuss our Third Quarter 2023 Operational Highlights and Financial Results. A press release announcing our results is currently available on our website at novavax.com, and an audio archive of this conference call will be available on our website later today. Please turn to Slide 2.

future key prepared includes need of relating or year those partnerships, regulatory ongoing upcoming forward-looking its timing future cost Novavax, its actual candidates, with that in anticipated remind to plans, XXXX begin is to to plans, contained and manufacturing outcome of this reduction and of materially presentation operating and statement performance and strategies, in impact the XXXX business this statements, cause its subject filings the and we first results differ remarks, or prospects, financial risks financial to development capacity, I projected conditions and actions, you statements. and our the key opportunities, such uncertainties, objectives quarter Before marketing and forward-looking and could priorities, guidance, full from amount strategic future including presentation future milestones. Each Novavax' information of availability vaccine that

information morning we www.sec.gov with of Slide Form X. Additional as the the and well Securities issued XX-K most the subsequent no as in appears we turn of to on filings to presentation our this Form Cautionary with heading these filed obligation and revise speak only any heading deck original and website as SEC. presentation, statements slide subsequent statements. the undertake this regarding recent at under forward-looking and update under novavax.com statements. Please of this The or Factors Note forward-looking Exchange in In the and Risk at our these the Commission available XX-Qs and regarding factors date

progress who X and Jacobs, our on an Joining for our key me today quarter the update President will CEO, during provide priorities. John is our

will update pipeline. clinical of Dubovsky, provide will John Chief our Officer, and activities. And Chief Filip Research our development Commercial Officer on and President Dr. commercial an Trizzino, Development, Business Additionally, and discuss

overview Slide turn an call results. I now will Chief Please and would over Kelly, Officer Financial of Finally, like to our to X. Treasurer, provide Jacobs. Jim the John hand financial to

everyone, I'm XXXX us executive we've highlights, the today. you, and priorities. results discuss to important quarter and third and members X you, here thank Thank the along Erika, operating made across be for with our of financial our team today joining to pleased our progress

begin of with Let's the seeing to Beginning October. have seasonal was priority, market U.S., we interest after we season. X limited updated and increased COVID-XX in our current the changes, with Nuvaxovid the on demonstrated vaccination the gain our preliminary our broad our and to of ability deliver we the on an strain option doses protein-based APA our weeks to U.S. we've shipment the non-mRNA our to in launch vaccines, prelaunch pharmacies. first only data, approval early competitor approved vaccine share achieved commitments. In subsequent access growing to and We our and indicators for commercial product delivering season securing and weeks of in update the fall with goal EU, major our Having in ago Europe, are the with in awareness retail country. approximately execution vaccine. In focused started although are vaccine, several we the launched

Canada, deliver for 'XX-'XX U.K., New agreements under all we doses awaiting contracted the of these advanced we also are markets, to purchase In have in We season. authorization Australia which and the Zealand. expect

time. Market this point launch we market in uptake U.S. the of wide, it's the mid-October, early seen believe in Given lower-than-expected assess COVID-XX have demand. at we our vaccine to too true vaccine

first revenue weeks at the expected with expect XXXX. our guidance of behind the end U.S. some to for quarter in Given season and the uncertainty revenue we deliver into prior of in of approval the low the several market the our to competitors, shift Europe

we did Jim this to originally in provide will context expect on QX the XXXX. Importantly, later revenue occur in Kelly not more call. of any

which is team management our come, to and XXXX many leaning in transition concentrating health we portfolio additional are represents platform our the a to and and includes preferred is a of to differentiated vaccine and significant efficient an likely product in which bring vaccine XXXX, believe to consumers a this on vaccine, anticipated business facilitate which protein-based late-stage focusing well and presentation COVID-XX-Influenza years Our COVID-XX-Influenza will our optimized launch forward robust Combination opportunity providers. the as our for into to to a that for option Combination which investments more be and market, XXXX. create sustainable We business is in opportunity model, of development unique create combination a a why smooth as restructuring care

Now approximate progress the to capabilities support reduce value to baseline. results on operating scale include reduction evolve commitment XX and our Priority to our our significant to let's $XXX to and is an In maintaining XXXX, which spend, improve while move rate position to reduction quarter, the of billion in on continued liabilities financial we #X, current flow, cash make our December our manage structure. long-term $X our versus addition, a to million creation. Year-to-date expenses from and

reduction demonstrating at our our expenses, capabilities. our achieved by our season, successfully same exceed R&D combined can while reduce global on this XXXX of $XXX cost and announced the previously that are maintaining vaccine for for we having while time, restructuring core over cost significantly launching We plan track million objective SG&A and to and updating

prepared million Jim to reshape beyond with stated decrease structure speak our expenses are combination vaccine align and operations XXXX. XXXX cost this plan to for important we beyond later and there the to in the drive our XXXX improvements we significant advancing about $XXX while call. our size further will additional initiate can COVID-flu our previously reduction of above Therefore, cost we scope prepared market announced targets, reductions to opportunity, an emerging by targets COVID Kelly efficiencies over further to XXXX previously was While are guidance the step, program. the and are more And achieve. to

capabilities platform, value our beyond our discuss leverage let's assets which Finally, additional of technology and #X, Priority Nuvaxovid. drive our portfolio to to is

and Our nanoparticle vaccines. technology variety recombinant platform have produce Matrix-M to a adjuvant differentiated of the protein-based potential

Our bringing priority COVID-Influenza focus forward our to here investment resources R&D and vaccine protein-based is on product. Combination our

independently. the States Filip and enable As III the XXXX will in upon approval FDA concurrence a discuss program fund later in planning we accelerated now III in this XXXX. into call, an 'XX Phase move on United a in launch Phase are directly contingent in pathway, potential program would Initiating to to

team additional the quarter John? from Trizzino would more our the our members to results updates. commercial I detail, like to Now discuss over hand it with in John beginning to discuss of to

Thank you, to John. Slide X. Please turn

are weeks into we launch. approximately As John in outlined our the X season U.S.,

and We across retail prioritized Giant groups including broad secured channel Aid in are Publix, country. we Rite segment as XX% medical largest by with our the date, Costco, the top of that product approximately & majority access and availability well thus vaccine market the to the major retailers, is distributors retail setting. of of was the pleased To with networks far, integrated as CVS, through vaccinations Shop, have contracts major of and Stop the COVID-XX delivery

COVID-XX, have currently that expect could to channel split can food the which channel vaccines which Looking X. year. Please reasonably the half U.S., slower over offices, end at non-retail we start seen we see care non-retail is market, retail includes grow for COVID. this that provider XX-XX, been the just years. than In turn we season, through mirrors the approximately the a COVID health of for of Therefore, to last At prior season have XXXX Slide point, administered.

So the we into the significant could that to the potential opportunity season quarter. expect first remain a market with extend

flu, this low including is into market or without that break, goes others. pickup as distribution as date from other from U.S. amongst slower-than-anticipated should challenges an season, the data significant high for pandemic the market vaccine available the elongated first that to leading doses commercial. The is and pneumococcal quarter. time RSV the availability updated uptake government Based of multiple we purchase as trailing However, fall, million it vaccine trend XX U.S. vaccination in channels we estimate or first a are million that as doses, vaccines, XX a break in trend believe multiple upon could to the fatigue the same converted see to season factors and the as it be from our COVID,

We his in factors. information are sales other these the expecting lower-than-anticipated U.S. due and market more Jim provide section. to will during

representative XXXX turn Importantly, providing and not of the combination-vaccine that the believe to and we including COVID for be to Novavax X. market opportunity, future for options future; opportunity sustainable revenue years the a will C, market growing in come. Please Slide do the

consumers offering season. care and that mRNA available encouraged in a now are alongside our choice We U.S. options, the is providers vaccine this health

early is single-digit we currently While consistent assess of third market with analogs in is which potential. we low for are it XXXX their their our believe to stages to too that early seeing full launch, share, market products

some stocked we fully a compete. and seeing available effectively are where and that early are We field we positioned level-playing indicators on can

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seeing with the in scheduling availability new channel, vaccine and we continue proportion our retail to we'll to in are of work and are stimulate the promote market to we share focused channels. demand the of driving non-retail working channel, Given this in online in currently their systems high the both vaccinations store, pharmacies in on

to targeted and focusing highly to also direct-to-consumer on brand and locations are vaccine. Novavax name public awareness and Novavax' drive consumers efforts availability executing relations the We of drive with education

discuss that dose existing received vaccines for seen a option authorization. EU, penetrate efforts, be our belief in ability X vaccine ongoing transitional product 'XX, approval to of committed Slide U.K. our that want foundation differentiated of XX. market our billion Influenza-COVID Novavax for rest sales a our stand-alone and Singapore, should which offered outlets long than for the our Taiwan alone size continue XXXX combined is our the leading I 'XX all the with that one greater in-season multibillion-dollar R&D. reinforced as us company. Early are a to a substantial our be to Novavax opportunity hand the with market including half Novavax. pipeline, deliver only we term, And the Just both have like reiterate, regulatory awaiting is vaccine vaccine, play approvals, deliver would significant retail offer respiratory there has all HCP COVID-XX that, both and is our market, in X penetrate U.S., and Outside on by $X has of and a schedules This COVID-XX our it our to I this retail for to committed doses turn believe of within to In for market feedback potential aided the Slide Nuvaxovid XX% our of season. Please APAs. we the delivery franchise APA product to over Combination it when represent into season to role driven vaccine, future. And promotional that Australia, to XX. seeing and expect The projected the sales lifts are opportunity available. Please Zealand, awareness the to to with X to a New updates the markets, Switzerland, and share other be we from XX%. Based over regulatory COVID-XX awareness subject weeks our we opportunity will the to Filip we from now those a in the Canada, regions, and and to potential U.S. with launch provide vaccine to key for potential turn that the advance world of remaining that doses WHO to annually. meaningful in we expect increasing demand between and for

same commercialization nanoparticle on of use turn the for after the topics. our technology XX. publications John. Novavax plus influenza on the is turn program COVID-Influenza to our Matrix-M and an Please combination COVID-Influenza These adjuvant. technology. in we're of cover for how seeing been came different the the I promise Slide our our the approaches update progress understood Thanks, expanding Combination topics This technology. I the Combination couple vaccine, and used vaccine. of capitalizing a exact Slide vaccine. Please licensure will exemplify COVID validated Matrix-M development, has to and The of core original to Today, XX by in to

formulations, previously discussed, to program XX and priority has care health be discrete the is preferred Previously, product As because we a a displaying it clinical believe to this and providers. the vaccine because the the important combination formulation evaluated the we've we most consumers efficacy. selected are slide. by potential into closely Neutralization study. I'm advance we now on responses predict neutralization next responses

On left responses included that responses vaccines. for COVID-neutralization strains are X the of influenza-neutralization side Influenza the will the slide the in be right and future

clinically the noninferiority road They as points favorable was want to This our the comparable comparators. III a convenience our ratios compares the influenza well we tolerability. Overall, to load of maintaining gemetricmen demonstrating observed you, a late-stage hallmark a X profile to in the combination previously licensed the that technology, Phase reactogenicity I we with product coupled increase responses mean this used these profile well license the acceptable achieved reactogenicity X in remind while influenza factor to HAI formulations. vaccines. from vaccine development. formulation Fluzone the toward compared a be both selected to profile paving Nuvaxovid antigen of can appears of Our vaccine, FLUAD. Separately, as and margins studies, indistinguishable vaccine favorable we High-Dose to also a with

to XX still final a ongoing, antigen-sparing, concurrence, study response, of next the Slide companies the cellular antibody, a evaluate pathway to co-formulated to approval designation we've let endpoint levels the for high CDX on antigens. is and Matrix-M about regulatory initiate next Pending designed are long-lived we've may Formation turn neutralizing while is talk to performance difficult XXXX. first, characteristics. that to about development in an accelerated the study. Please you a Matrix-M. Therefore, study simultaneously and we building be track database. Phase have year's me updated III adjuvant to But induces broadly for manufacture which polyfunctional appealing study remind

the development. Europe of adjuvants received and vaccine antigens, licensed included component veterinary quantities even large that discussed, with in included a we've with it vaccine, recommendations COVID and to well-characterized profile approaches maintains database. And a commercialized MSD Intervac As as pursue the in vaccines large vaccines. We increase a it previously our of safety reactogenicity is multiple consistent value. Sage additional vaccines by in malaria recently It's WHO in Animal use. It's Health RXX for has

Melinda animal clinical component viruses. biopharma and previously targets have being being & preclinical the Medical biotech, in it's against vaccines in for in academic As pipeline we government health in announced, evaluated a evaluation XX use products, and as by authorized finally, in a is to own improve its evaluated public respiratory candidates partner stage it's partners. And our by currently to Institute models herpes by Bill And it addition of Research Gates importance.

expand Matrix-M will these represent it unlock from do not future vaccine. Please successful, Matrix of collaborations focus turn and COVID-Influenza additional external our I'll to projects out of are for and and value. mature, Novavax time if Slide the our the on set, lines long-term projects These the for these combination-vaccine As planned XX, distract us the opportunities performance development program. data top lay Combination

and anticipating for in which XXXX approval formulation second selected strategy. goes XXXX. development in the to our initiating filing if finalizing the we've This smoothly. we a developing in are implies Phase season, of our Combination III and program, half For could COVID-Influenza us Pending dose vaccine regulatory regulatory participate allow study concurrence, are accelerated XXXX, fall manufacturing our the the

Okay.

results. discuss our financial it over to hand me Jim to Let

you, Please to Thank Slide XX. turn Filip.

I to our was to achieve that XXXX. XXXX, Before $X.X expectation themes sharing of of drive third which guidance performance, guidance billion, total season COVID updates our financial our share are for end billion, X on the year for range we 'XX would value. Today, lower important quarter financial revenue like prior billion of first includes discussing full to the the to shareholder $X.X reflecting our financial updated $X.X

year combined the XXXX. quarter with revenue expected no XXXX-XXXX in originally vaccination of full timing have revenue the of we the total to with sales season. Consistent XXXX, in revenue delivery quarter XXXX first of recognition total and the associated XXXX the reflect product updated full guidance, revenue For we sales first

the of to XXXX. start longer due we first the expectation delayed However, to quarter for an a will expect of season U.S., some into the portion in recognition extend revenue

committed XXXX the expectation for approximately our $X APA deliveries some In portion guidance year may XXXX. Therefore, U.S., full the includes approximately quarter now and into the addition, total billion of outside for first the of $XXX dose our sales of extend $XXX guidance royalties. revenues, This XXXX. our U.S. $X.X million lower billion updated quarter offset favorability expectations, APAs in by based in sales estimate plus on first total of the market of a and million in revenue current reflects grants of

focusing our platform earlier, into business come. team noted robust As for leading to management on is years opportunity a sustainable to and create our and

to reduction pleased full previously SG&A over ahead cost the for in XXXX. for million year $XXX be and we're announced While our R&D efforts

prepared reductions targets. by beyond existing to additional to in cost XXXX initiate $XXX decrease our are We expenses million over

of have Regarding cash we $XXX XXXX, contingent from receivable the cash, quarter across and accounts plus Canadian APAs, the payment. as cash expected third million over

'XX season will have APA addition, deliveries. contract value the $XXX we In in million post XXXX,

drive As XX. value. Please forward, costs APA of financial to turn towards with reducing and shareholder market profitability key we aggressively move U.S. opportunity our sales Slide to managing cash our and long-term combination along this levers

highlights. now Turning XXXX to our quarter third

agreement. of realize the total we $X.X a of compared Novavax season. Combined recorded with or quarter expectations the were manufacturing the quarter XXXX later funding during XX% quarter with a SG&A $XXX of COVID year associated in third a full million settlement. XXXX, more billion third the benefit $XX of the in the and an includes reduction $XXX comments revenue. the highlight the XX. $XXX $XXX value XXXX reflects million to The million. on decrease turn of to expenses results. quarter-over-quarter current 'XX U.S. The XXXX decrease in million For Year-to-date quarter recognized start our compared review R&D million grant revenue and government or liabilities. Please third revenue billion expenses our $XXX total the for a This in to third for to prior results few regarding quarter to was $X the our XX% for Slide detailed additional approximate A total puts consistent track under and vaccination XXXX, reduction million

Our current operating SK R&D the favorable of the liabilities Bioscience both impact that settlement expense. period include expenses million with manufacturing goods $XX and of the previously in to certain is recorded associated announced sold cost

sales the of to third million XXXX Our compared for million XXXX. $XXX the quarter cost of of $XX third were in quarter

and Third as losses quarter excess expired or to firm sales compared in of million XXXX on $XX inventory million to related in the same purchase cost $XXX included obsolete period commitments XXXX.

quarter For XXXX. Please in net quarter $XXX a million of we compared to third $XXX the Slide of million recorded of turn XX. the loss XXXX, to as a loss third net of

prior COVID plan noted, lower million we reshape As are the million the spend and scope reducing reflect of million operations $XXX decrease expenses by compared and additional $XXX align to so expenses with targets in prepared do to SG&A further market XXXX to opportunity. reductions business R&D $XXX to and We over to initiate or by cost XXXX. size by

costs over continue as to footprint. Please Slide million network In by intend XX. $XXX reduce to to we our addition, manufacturing rationalize we turn supply

year quarter guidance XXXX. financial additional for to the details turning providing We're guidance first related financial and Now revenue some total our to of XXXX full guidance.

of combined secured between sales sales and from for product orders Our of royalties. Product grants XXXX and $XXX XXXX billion total million year and committed related new sales guidance million. the first $XXX deliveries, updated million $X.X reflects over U.S. APA million and full includes for million $XXX $XXX to revenue quarter and $XX dose market

previously balancing first quarter of first XXXX achieve to sales quarter our and billion. Of and million guidance XXXX we amount of product product $X.X reflects the total The revenue first full note, no sales expected XXXX. quarter expected $XXX combined XXXX of the revenue in total year

we're expenses be successful our XXXX full us reduction to previously SG&A today, first we XX-Q support and in global that year R&D If in in will guidance plan in outlined exceed to the cost SG&A believe you for provided which our XXXX. R&D and at we For the we $XXX in expense see further our We our million. going cost provided filing an approximately will the now disclosure, to positions restructuring XXXX, expect concern prepare operations structure XX midpoint our next $X.X February. announced improve by track XX-K billion well and on this our funding update the In have on as over achieving of we months. filing,

to be uncertainty to sharing deliver call to this seek shareholder related some forward we improve the remarks. value. With that We to Specifically structure additional look for months that, the subject to cost strength back Novavax' turn over XX pending next updates John forecast continues significant to arbitration. for and performance, closing I'd and like to revenue to as financial

in Jim. Slide XXXX, in significant coming Phase against combination-vaccine you, the targets, of am current I liabilities down proud the the program launch priorities updated a potential over X of year. including $X and in cost the XX. being to ahead our III United States, billion we've in $XXX of our reduction of vaccine year-to-date enabling turn progress Thank our our paying million initiation made Please

we begin opportunities for We program market see further to the annual significant our to are future. to revenue and the excited company opportunities combination COVID-flu about a our generate the launch as in opportunity, the capture the and adjuvant future business for the long-term sustainable business Matrix-M revenue, and COVID-XX our diversify strengthen generation includes to a come. ahead U.S. This commercial of to potential shape ongoing seasonal

as the which and includes we in sustainable XXXX. I the in confident product optimized a our create the development to launch as well advancing 'XX, and which robust late-stage and differentiated said XXXX smooth in I to come, efficient on to opportunity to As create facilitate our in our and objectives. business are vaccine call, an a presentation restructuring and focusing a of and of transition additional more into will leaning for business dedication years Combination platform model, earlier employees' remain for COVID-XX-Influenza our anticipated to grateful

investors We we our deliver will of shareholder take with loyal ongoing driving to are our your strive also on objectives intent value. And as appreciative the questions. we the support now that, of of long-term with

Roger Instructions] Our comes Jefferies. from [Operator first from question Song

Thanks for the comprehensive update.

couple from from a So U.S. market. Understanding $XXX the questions to Maybe updating million us. you're start million of the the guidance season. $XX to for sales

how the behind Just a you us still that far? way so give color curious to you the protein-based share that market database for towards the little also, given terms guidance season. And you And bit think potential number how of based want future of around more for on in further about come capture will market about how thinking end your to -- of -- share the seems season, kind the importantly, in Novavax you're just confident about -- third-party next the vaccine do season Novavax the the COVID. and

few about. ask very you thank obviously, of in strong some call. large how sure us. that's no that you really joining that vaccine. for for And still the We're your in be the few now. here one's -- question. weeks in market the weeks seen to We've one and with Roger, John the will before interest Roger, just right I'll you the something really it's Trizzino it's data unknowns elucidate right? call, a Appreciate is of the early season of early biggest sparks very a on

the remains the is as in we to John a size ask Difficulty]. of uncertainty on largest comment John? I'll those so But And U.S. the few through market go that things. [Technical

fatigue I presentation Roger, delayed factors 'XX look, during a this think dynamics Thanks, some with distribution I start, and market, that And we number challenges vaccines here. have about learning size the total we're 'XX, market season current we're about being day the also that dealing multiple about talked every associated think with then the this been [indiscernible] with John. some there. in lot season of

I but December opportunity balance an -- at and look of the pharmacy ongoing to us, there's So related that we think as November vaccinations. for

think expect some to growth see behavior, consumer now. of in in significant significant are there also right to wouldn't that going going is I that, upon that low the non-retail change sector the doctor's we how I would not based be office. change

see And bit then that. a think I we'll it being into see elongated little QX. we'll So

some early on coming metrics we're As some of having we and I low share. digits we're level-playing national think we the in and far that is we're seeing, pharmacy. good as national This seeing of There's single we're in in the the were retailer, overall, pharmacy, where Look, -- market XX% said particular, seeing from one the recommendation a field. product

we're of we're also the I'll that vaccine same see get in about of some that I consumer So kind with season. And optimistic And of third is remain beginning market. place enthusiasm, marketplace. we before. we're just balance that the behavior will, the to shift that dealing understanding kind controlled where of Obviously, the all a to had if taking you

So tuned. stay

year. And I early it's And was, next right now, too about of think Roger, other part the your tell. to confidence question then,

[indiscernible], we we've X pediatric seen cetera. year, But anticipate label, our spark, said, of a that As dose mentioned, better a XX% weeks BLA, hands et And unit we in here. got major data, next full like we presentation, share. a data to having retailer John up including

next we're playing-field we year very when to XXXX. ourselves even But this the with right or we're well from year. better in and comes It's in So in now, a for mRNA. leaning year, transition much before it position penetration really taking learnings to years in market were U.S. than the

are approval? recently those in deliver the also And based APA, the already know $XXX year million already renegotiated of got you ex-U.S. the of in to I set further the around upon million terms $XXX XQ in got APA just the for so delivery then how And order. likely or current you will us the on be for remaining approval this total, that think can start into let

Jim Kelly, that? do you want to handle

Certainly.

in our guidance and secured first schedules. for committed included tied APAs So with these fourth to APAs, delivery they're quarter, are our quarter the

we case we're the getting doses. Europe, enable about New us that in deliver Zealand, course, Australia, approval, in those And the the have to like Of it's filings important market. markets for doses in of those the to of completing regulatory process

Southern they're Importantly, Hemisphere.

So the season. going them meaningful shelf type to they to when they're life be doses as arrive, have their those to enter of

renegotiate. Now we'll all agreement. stipulations they We on can they them And per to have the get not, to have agreement. come with do that of these attempt on the time expectation there per time we that APAs, if the deliver currently

just one directly COVID-flu me. Is year. the you move trial, Maybe one last good it's next Phase -- the from trial, combination III into can

Given operational XXXX, And expense trial sufficiently be to fund III cut how the Phase additional that plan? will without will do a that able you partner? think the for impact you

Good Go question, ahead, Roger. Jim.

reference a I and XXXX update as the path pretty important exciting to early a Great will -- question. in an market single And our to as first changer. this from about Filip with pivotal think, what I is potentially lean approach back today study. path product combination a is, very I get mean accelerated game

we think any something very manner. many recently. I'll it, similar I from a it call market heard enables us think efficient highly path And folks capital, to Moderna

Okay.

going with year. below provided this to next So study we That our inclusive R&D SG&A million of beginning update we are the today, next is where to fall. respect drive to and $XXX

runway and do a creating on our establishing combination we we competitive both contemplated product, And accelerating not on wouldn't if through of a cash you I for $XXX to billion components. quarter outstanding organization accounts in season $X and the $XXX in can today, $XXX the to through a factoring payment to that then focused job to cash next end to sales APA hand, value I'm but did opportunity, X on have quarter million components midpoint highlighting. from over before of cash million while in cash receivable, product, path mind, 'XX, X contingent described John that at focused talk as over I year. first going I of important and 'XX cash just plus little these enables which described a bit current and really pieces, you Canada. Add I'll the that critical really And million 'XX market lean so. And describe expected the nice U.S. COVID also contract 'XX. combining about think the XXXX so million are over And in expected that, that. described see that, fourth we $XXX the We of

some for upfront our to billion structure and against Then -- the combination in of $X and clear financial me, with organization, both out ensure are lean seek in reducing net visibility and of that cash. next or invest program. as execute and to prepared cost XXX you you've focused to we got excuse you strength over accelerate that Now fall

helpful. that's hopefully, So

UNICEF Roger, also like runway billion Jim XX generate quarters else in from next X that And coming from for not new to authorization potentially. the which just $X opportunities doesn't U.S., a the coming Korea, what things from in even the vaccine, include years order in all just over like our and other additional RXX Jim low-income laid months countries, us markets does over and which just South Europe revenue that the out, company received anything placed from from contemplate with

year already United of vast through which full secured QX is minority $XXX secured APAs, majority launch just is laid is revenues that contemplated intend the million QX. for what and we the first through revenue So Jim other that what's deliver talked primarily the doses States. of is about on Jim and to point in APAs. One the out between the The

a So a other those independently upside carry and all standpoint, kit to we of just for launch program to the us potential pieces. beyond give standpoint then our revenue the forward from have before you opportunity cash to us

Joseph question of comes next from JPMorgan. Our Eric

part U.S., we contracted to mix, the prior of aggregate for how across thinking the ceiling looking carrier revisiting seasons, Wallgreens you a that pharmacies to guess, -- the market not really see being being should how a was vaccines, perhaps about well, getting your Wallgreens at vaccine, over as the be much uptake? their updated it question product And perhaps seasonal that I the -- represents decision you should with -- not season? seasons, In of carry share we the just COVID flu relates can

to John I'll All comment. ask right, Eric, T

on maybe First, and Walgreens. share then the dynamic channel John, with

historical is what channel what is I like this talking you're far mix about year. then So so think and looking it

last and what and data about let's hundred seasonal that seeing the moment. not based the And to channel doses retail in a similar in reference that for at XX% we're So We're in was is so. some or a last in where XX%, in We're and seeing non-retail the COVID I about accumulated the balance it, call so just presentation thousand flu, XX% far. there year non-retail of the for seeing retail in seeing this made upon non-retail. we're some year, for the statistics vaccine accurate that typically, XX% that's few X-plus approximately for X, years

season we But But mix. Consumer of we're not of a retail Again, sort saw change we're not that for if in see see sector also yet of the October. elongating we a volume that and XX% for that that's What so flu, seeing to dramatically far, last seeing to seeing year. before So behaviors change is COVID of in COVID, it's and monitoring bit that's market actions typically that see don't true. that expect you'd heavy period time. for and that the end heavy, we're shift.

multiple push there's for a So reasons.

I vaccinations on all think a there's that. burden pharmacy heavy is that affecting

so closely. we're it And monitoring

data presentation, that weeks seeing. into the said earlier we're we As in only X we're on

come that And so weeks in as more the the monitor to few mix market. we next over

the your believe part question for specific to other I of Eric, was And John. Walgreens

our to the readily program. channels right other with just there, broad participation if now want It's John, also question them, to in believe. But with so XX,XXX outlets government the IDNs That you accessible to want in the physician distribution make specific States piece. including I the context over may U.S. And and vaccine. bridge working Eric's was network Walgreens sure the in we're United into or retail put

Hello, operator?

hear you. can We

all that relationship with for And retail locations we're that great that understand through seeing to it's important of the retailers, CVS. a

for at I think looking their make to programs opportunities other evolve to pharmacy coming through awareness that awareness We're create communication that about all a to as the locations. lot the there's trend into any and awareness sure seeing vaccines for care health awareness mentioning we and they're of see last expect couple as that, and over months, provider the that that that well up consumer earlier continue. acknowledgment of talking to the is

I'll on is just XX% CVS Eric, thank within retail miles have are roughly add alone, John. X of which X Americans -- build one point all stated of on clearly just that so top John based you I'll what there, of their of you, outlets.

the So of vaccine. if get they our Absolutely. Americans like the they have Walgreens? we to vaccine, close are That majority vast goal. can very Would was want our

continue And be our good that, work and that's to long despite want They're run. if to thing. they a We we're with the important have But most close it, vaccine, will partner they them. access for to the Americans.

too CIC we think Maybe or one but of follow-up perhaps OpEx of about obviously of anticipate self-funding the just thinking sort the course you early about over trial? how III resumption -- recognized build longer-term as of maybe thinking be sort for I the about 'XX, OpEx it's ask this, how Jim, -- in just XXXX. can particularly for sort the Phase efficiencies in outlook, whether just of of should And

minus really think that range. long-term, what sustainable, mean what we're of least begin profitable to COGS, your reinvest SG&A, so, XX% in to R&D sort of sales under then, is you of course, all And margins, gross organization, doing sales in COGS we're a minus minus going that. right? get you margins. that And to with that profitability got in driving XX% in to. XX% I'll call I commercial contribution a I'm this by to at profile I'll And call about When we what looking

this what's That's an start blueprint efficient as, the vision. cash your be producing to hey, to drive company or So that capital entity? and with

And the describing as specific it act announcing, 'XX, us through to but urgency look are an with for we restructuring. this structure, evolution not of year a we're then earlier for you and act 'XX and cost previewing and you. example, witnessed speed. this drive We're we today at to that while evaluate

enable as recognize we could savings in And that in fully that those million so XXXX. early so early a driving you drive XXXX, do towards a expect that filing should as less can of we for $XXX the to to while accelerate continuing XXXX program launch possible CIC much turn will and SG&A as that as R&D and or as to in

we're for the the principles it, So those blueprint, are call guiding the, I'll where headed.

comes Cowen. question from Smith next TD. Our from Brendan

us. quick of from couple ones a Just

U.S. based territories? those that thinking any APA kind of tell confirmed based It's First, these for additional of the you you you're in remaining approvals, you completing you with cadence. And or I understand maybe I of the Or actual million any going? on something, might provide have things us all of how related have pushed can Roger's to kind have any delivery on still of there? actually the Ex a the for of I approvals are timing just possibility how all? Ex you process based some just filings? current that your and U.S. about to QX, on waiting of this the at color they wanted to then cadence clarify kind conversations trying on renegotiated Have on these might in is of best potential heard, think get earlier related question, And of a kind just trajectory $XXX kind the of are just a the past you're to approval? And guess QX then just the I done have follow-up. some are that, can little QX QX? in Or Or really of

then you that don't hear why we'll Trizzino, John the first question, follow-up. take

QX have approvals, on for Zealand, still million year and expectation to few have New of explanation Singapore, weeks. regions and we Australia next in So to guidance end that us also EMA Many to the and U.K., possibility them as on QX point. roll And be of the [indiscernible]. I'll we've will the into are in the Canada, Jim. of make $XXX Ex waiting timing waiting that allow U.S. the those might and deliveries. we We're some before, certainly, WHO within U.S. over provided some this several, Taiwan, at for that leave of received that the

Yes, ahead, Jim. go

Yes, certainly.

secured mentioned, got John delivery. for we've orders As

inventory we've APAs that to If are so million, it the million the approximately of got are we you them, to total, go. you are deliveries. hitting could about moving fourth -- fourth midpoint it to those some the guidance And million, up within the quarter, $XXX guidance, to sort overpromise. could And ready supply like of with just first got chain, that that lining quarter want things see and way said, don't European the but in the some It's our we've $XXX with look end our at across there up of with spread that going really $XXX in call deliveries, quarter. be

any bottom we this don't is QX to expect The of drive beyond line [indiscernible].

to anything add to Jim, that?

that's No, it.

these distributed the can for maybe cuts cost be maybe just XXXX? bit will where from, accounted some And are cuts, filings. elsewhere they're in on across maybe then being R&D your a on new whether And expand of how you coming the

there's Just been really like changes quarters? bit kind potentially any trying -- what or in few the methods and of like a look accounting they'll the past a upcoming tangible of sense beyond plan little over to get if

opportunities supply we from? you over say, opportunity with reducing accounting. $XXX did to structure. of combination real investment, $XXX So our Where chain-related these a $XXX support I with for capabilities, come on a savings. then not is be we should capital million the begins our R&D people, million I the the that return reducing in from? Where This the serve is this about real by start come first with for we focused facilities, that. also a prepare to evaluation over that as COVID going and would that your SG&A not. cost savings, million. we're investments a sites, shared forward-looking improvement total pursue and real expenses to assess investment and say, over by function, It's to our markets and focused cash, is your you these It

reshape of vendors and that have resize them and takes third-party you us to evaluate along assisting then journey it. on it all You and what

write-offs, demand. got So chain. avoid One, with we better I'll to of do at to that demand give based to do the the focus got any manage we you Then our we E&O. aggressively signal, on specific capacity reduce our And that, you about examples supply overhead got be of how and with risk knock look we've idle supply this your at much We negotiate on to to further to third-party sharpen has This supply relating along thinking these we continue operations out. support. got agreements and to leaner you facilities, network. alignment internal talking to I'm got then

So that's supply how you side. come after your

the side, approach focused a how from it. heard lean Filip, you CIC. do On you with R&D That's

and and drive You get CIC this more going to efficiencies and efficient higher company. overhead, to about commercial a market faster leaner-focused support profile. infrastructure to we're everything with market said investment for And then I

program since a a business. key. And we've line we capabilities knowledge beginning strain you unveiling of team team forward of and the that, that market COVID this capabilities taking operate, focused of with and opportunity the global for to a without add fact decisions $XXX was clarity. we competitive more the the to now just continue thank earlier And upon to to joined bring announced build really to that team, expense anything scope as that? ahead shots how a we're can we targets decisive by to in Jim, leaner million this the make and forward that function, the and a filing program, over assessment a and confident year, that pandemic. down not line to arms in and proud And this we itself we're as bring said, status. Jim, to the out reducing fact, year the able pandemic. to did independently our we CIC scaled the and the cycle in so this of make real and of our that we're new make of is that I scale earlier but on efficiently action the sight company that selection on we operate Jim reduction in here, to scale had year sight management demonstrated year, system cost that's right XXXX as year, with cuts, The And accounting damaging much and team, by can and post for larger management more originally to built need Board and and a an And leadership company of

on and towards way driving operating everything It's day-out, John. said, day-in we're you that focused just focused laser we're the

B. question next Securities. our comes And Mayank Mamtani from Instructions] [Operator Riley of

this just early segments. on for XQ, sort follow-up trying the to a a expectations of I manage to comment retail, maybe XQ. returns goods you're of nonretail prior time on cost expected know So on revenue going Could as insight possible. line noticed grant today, there you was your just clarify, And high Any and I in I write-offs, what's real of guess. particularly that as were also some sort item?

particular you one? one revenue? And second X grant are is, do One we There's has what's about pieces there? to what with the we And are learning third A there. hey, hit Mayank, seeing me, forgive returns? what

sales reported cost QX. that line for the item of Yes, today

November. So window first our returns, of beginning opened with really return the

that sell-through with has our to that got an $X.X pleased the be both government to U.S. [indiscernible] upticking take Why? million. the our and done what Filip going our tell we're that specialty we're vaccine full million $XXX us in to enable partners revenue. in to there. improvements revenue, of addition exceptional by guidance you're we milestones advantage job were U.S. So And -- really the working to course. On we multiple monitoring early with it, to seeing across being in and success had too for and grants to why uptick that's that, met available. too closely, one call market, of them. prepared also we're ensure seeing there good, our grant early returns, to you is, tied do But on country very feedback are I'll distribution we've give across royalties

is preparing early to to as next year. the quarter, about this $XX addition, Matrix vaccine our million as RXX Serum related malaria launch as partner, RXX In revenue

advancement important there. really So

Okay.

had million. right. is bit COGS line. All we what that quarter you're we we had noting talk no the Let's $XX a a a little COGS COGS where about in revenue, had

million. Let's happened There's in the $XX settlement benefit SK there. talk of from what's about a Bio

that. I know think you

is it You've and $XX can't we million. have got that focused. to got in $XXX to helps about got be that capacity. What hey, of things million lean that $XX a are [indiscernible], So happen. overhead. What $XX focused We that that to We that? take million add seeking noted These And being some be I We more we're about up types is, better. Again, that would is down. and million. the on part unabsorbed mentioned finally, to or overhead, to front. you to this some of in scrap you? excess drive then

looking dose work higher noted think Q, there including for Super picking FDA. similar Fill, program. also vaccine U.S. that Yes. remains? discussions that a along regulatory optimization 'XX On having on And any your CIC in XXXX, under you what also going And the that XX-year-old Ex helpful, if those anticipate update the maybe you're all guidance for very for maybe we're with for the then just, on then the you is just all come also updated and on with sort -- of comprehensive. map regulatory the milestones I was elderly. at road also for to Could

of programs Filip? on clinical the we questions to some address why regulatory related your there, Mike, Filip don't and the ask milestones

that squeeze Your into one lot mentions a run-on sentence, Mayank.

regulatory health well for in was that's market The we be laid approval from U.S. product It's and timelines most consumers we from in care timing as important our We providers, in laid accelerated in the a right? the out us, a for potential the that going potential regulatory as that's So a filing to focus. with out market 'XX. we see XXXX, CIC the demand think

we by That's as product. enrolling today. will finished study as dose supported Now program far U.S. that was that We've or government. the a high

the aren't We for available first previously would the year. time the age will of data. to year. be or following filing be group be relevant that that have quarter think said that next older -- we lines the pediatric in the following would season. data we available And going until of So we

I for here. X think have one time we or more questions

of Stranahan from comes Bank question Alex next of America. our And

us as well. A couple from

first format. on is The the multi-dose

then used? see the you've to Given seen And a price not being they a back I've doses? you the kinetic in that reimbursement Are follow-up. doses pharmacies? guys? date, to happens vial risk to what or how of demand do feed And some And into got a does you to shift those

I one John address have Trizzino on that will returns.

And look, X-dose moving what future, our dose Alex, vial. anticipate we're kind the would it in think, direction. a it presentation. for of I course, beat we that's of we're that unit marketplace and in wants some

care that flexibility the vials, use the to those As we've provider of there's of that and as made health use vial. far sure the

of vials return So opportunity all to an provider we're are process. if X there's that and third-party not a doses that used, partial through tracking returns

then provision a and allows available in product is is in and our for the place to communicated our no period made the with provide And that that And been that there time. then that cost whatever is provider. of it's of we access, So care -- to returns monitor getting that shelf health is intent utilization that end. that available clearly disadvantage on economic on --

comment Rev a mean quick highly And have Rec. to common I on provision. return then pharma a products,

So in we this We've seek books quarter channel. close we'll estimate. regular through returns fourth come We'll visibility on at our is far then got and the the entry, from gross for return uncharted [indiscernible] the make based an and the actual visibility rate to have on territory. both as

will part an forward. our this of be So go important recognition revenue

you Alex, another question. you And said had

see queue the arbitration the payments Just else? Film. noticed breach you other to out? a reasons? level, high the just that seek this or to there to installment may to -- similar vendors a contract one. language playing for new around withhold due something how Are I in withholding Fuji some the you quick Is And payment

Kelly, one? do you want to take that

right. Alex, you're Absolutely. exactly

it's that million third Fuji dispute are a and quarter, have time, with the We were in or with that to respect at that disclosed that total payments matter. opinion fourth currently this a the $XX X difference -- targeted for we legal of remaining

can't I too it. about much speak So

that You subject I And those to exposure. mitigate that's all might I this commercially think to payments remember effort reasonable time. each say were our can at

And time for one more question.

Vernon our Bernardino, a question investor. comes private And last from

discussed what a follow-up regulatory final for just for designed you comment from And the H.C. concurrence the combination is vaccine? Wainwright. being clinical now. study I on am Can I'll throw

expect For uptake that the 'XX, you season. it's season, 'XX roll in and us for on can you your dynamics thoughts give authorization regarding of what your out vaccine

the take part first to want Vernon's you Filip, of question.

in with So quarter. pre-IND a them. U.S. first the That's be part with to discussion to support is we're be of filing the this focus the going really that Since major an with to FDA, we for the is us U.S. going an and study. interaction the IND have planned

first that's into the them, timing the that bring going is lot are 'XX. to quarter why to of of data a and in We with

question, to more BLA under that season so than an year, then, dose on We're 'XX looking reasonable intending that course, well. we earlier timely being Vernon, up in vaccine the 'XX, a to follow for this availability. that's me basis as a let presentation our next 'XX. available offered. the for on were the So would on at profile able have expectation And unit for updated of We're plans it's be we 'XX, season

those share I presentation the marketplace. in driving are improved significant think that to are uptake market an So factors and

this at-time, we're believe I operator, And at point.

to remarks. conclude like And to for turn John closing question-and-answer back the session. I'd our over this any will conference

your to a and for energy close for wish Appreciate questions and all. Thank everyone thank to Want time and great their you you. your week. you

and you concluded. has day. Thank for meeting The joining, pleasant have now a