Novavax Management Discusses Q2 2012 Results - Earnings Call Transcript

Novavax (NVAX)

Q2 2012 Earnings Call

August 03, 2012 10:00 am ET

Executives

John A. Herrmann - Vice President, General Counsel and Corporate Secretary

Stanley C. Erck - Chief Executive Officer, President , Director and Member of Finance Committee

Frederick W. Driscoll - Chief Financial Officer, Principal Accounting Officer, Vice President and Treasurer

Louis Fries - Vice President of Clinical and Medical Affairs

Gregory M. Glenn - Chief Medical Officer and Senior Vice President

Analysts

Edward A. Tenthoff - Piper Jaffray Companies, Research Division

George B. Zavoico - McNicoll, Lewis & Vlak LLC, Research Division

Kevin DeGeeter - Ladenburg Thalmann & Co. Inc., Research Division

Christopher Marai

Presentation

Operator

Good day, ladies and gentlemen, and welcome to the Novavax Second Quarter Earnings Conference Call. [Operator Instructions] And as a reminder, this call is being recorded. I would now like to turn the conference over to your host, Mr. John Herrmann. Please go ahead, sir.

John A. Herrmann

Thank you. Good morning, everyone. This is John Herrmann, Vice President and General Counsel of Novavax. Thank you for joining us on today's second quarter 2012 financial results conference call. Both the earnings release from this morning and an archive of this earnings call can be found on the company's website at novavax.com.

On today's call are Novavax's President and CEO, Stan Erck; our Vice President and CFO, Fred Driscoll; our Chief Medical Officer, Dr. Greg Glenn; and our Vice President of Medical Affairs, Dr. Louis Fries.

Before we begin our prepared remarks, I'll remind you that we will be making forward-looking statements during this teleconference that may include financial, clinical or commercial projections. Statements relating to future financial or business performance, conditions or strategies and other financial and business matters including expectations regarding revenue, operating expenses, cash usage and clinical developments in anticipated milestones, are all forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Novavax cautions that these forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time.

Further information on factors and risks that could affect Novavax's business, financial conditions and results of operations are contained in Novavax's filings with the SEC, which are available at www.sec.gov. These forward-looking statements speak only as of the date of this call and Novavax assumes no duty to update such statements.

With that said, I'll now turn the call over to Stan.

Stanley C. Erck

Thanks, John, and good morning, everyone. As we discussed in previous calls, the last year and a half have has been built -- spent building our management team, developing an infrastructure that will allow us to ultimately take a product into the marketplace, and building and managing alliances to support our products into a global market. Although we're far from finished, I'm pleased to report that we're beginning to see the fruits of these efforts.

In the last 6 months, we've initiated 3 clinical trials, vaccinating more than 1,100 subjects. Data for these trials are beginning to come out and we recently reported on the first of these trials and expect to report data on our Two Pandemic Influenza Trials within the next 90 days. In addition, we launched 2 new collaborations, continue to advance our preclinical and clinical vaccine development programs. And that, both with Novavax and with our joint venture partner in India have strengthened our balance sheet. We are now in a stronger position to execute on our clinical and commercial plans, and with that, deliver enhanced shareholder value.

I will first talk a little bit about our recent accomplishments and then turn the call over to Fred to summarize the quarterly financial results. After that, we'll take questions. I know that some of you may have technical and scientific questions about our programs and vaccines, and I've asked Doctors Greg Glenn and Louis Fries to be here to help get you answers.

Let's start with our seasonal flu vaccine program. The positive top-line results we announced last week from the Phase II dose-ranging clinical trial of our quadrivalent vaccine. As you saw on our recent press release, the study was designed to evaluate both immunogenicity and safety of 3 dose levels of our quadrivalent vaccine in healthy adults between the ages of 18 and 64 years old. As we reported, the trial reached its primary endpoints of demonstrating safety and immunogenicity in all 3 dose levels. As always, we first look at safety. The safety results are key, not only to this product, but to our entire product platform. And I'm happy to report that we again saw in this trial a clean safety profile and didn't see anything that causes us concern going forward.

I should note that with this last trial, we have now tested our influenza VLP vaccines in over 5,000 subjects. Demonstrating immunogenicity, we measured hemoglobin inhibition or HAI responses at day 21. The 2 primary measurements of immunogenicity that are commonly used for an influenza vaccine are the level of 0 protection, which is the percent of vaccine, vaccine means and achieves a certain level of AHI titers in 0 conversion, which is the percent of vaccines and vaccinees that achieved a fourfold increase in the level of HAI titer. Quadrivalent vaccine that the FDA 0 protection requirements were all 4 viral stains with 0 conversion levels from 3 out of the 4 strains. The 0 conversion for the remaining strain, the B "Brisbane" strain, fell below the FDA guideline. There are a few potential reasons for this and we have already initiated a number of actions to address this issue before we launch our next Phase II study in 2013.

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