Dynavax Technologies Corporation

Good day, ladies and gentlemen, and welcome to Dynavex Technologies' first quarter 2024 financial results conference call. As a reminder, this call is being recorded. At the end of the company's prepared remarks, we'll open the call for questions and provide specific participation instructions at that time. I would now like to turn the call over to Paul Cox, Vice President, Investor Relations and Corporate Communications. Please begin, sir.

Thank you for participating in today's call. Joining me from Dynavax are Ryan Spencer, Chief Executive Officer, Don Cassell, Chief Commercial Officer, Rob Jansen, Chief Medical Officer, and our Interim Head of Finance, Rita O'Connor. Earlier today, Dynavax released financial results for the first quarter ended March 31st, 2024.

Copies of the press release and a supplementary slide presentation are available on Dynavax's website. Before we begin, I advise you that we will be making forward-looking statements today based on our current expectations and beliefs, including but not limited to potential market sizes, market segmentation, effective marketing efforts, future expected market share, and related growth rates, and related ACIP recommendation impact on each. Financial guidance and trends, including revenue, profitability, cash flow, and sufficiency of current capitalization, timing and results of FDA submissions, clinical trial starts and data readouts, and potential future uses of or demand for our CPG-1018 adjuvant. These statements involve risks and uncertainties, and our actual results may differ materially. These risks are summarized in today's press release and detailed in the risk factor section of our SEC filings, including today's quarterly report on Form 10-Q. Our forward-looking statements speak as of today, and we undertake no obligation to update such statements. And with that, I will now turn the call over to Ryan. Thanks, Paul. Good afternoon, everyone. Thank you for taking the time to join us to review our Q1 2024 results. The first quarter of 2024 saw continued year-over-year growth in quarterly HFL-7b net product revenue, despite a slight decrease in the U.S. hepatitis B vaccine market during the first quarter. due to an extended cough, cold, and flu season, which reduced the number of vaccination opportunities, a dynamic which was observed across other non-restrictory vaccine markets beyond hepatitis B. Even with the slow start to the year, we remain very encouraged about the adult hepatitis B vaccine market opportunity, both in 2024 and over the longer term. We are seeing a pickup in the market in recent weeks as providers have begun to shift to non-restrictory vaccine campaigns. and as our retail pharmacy partners and top IDN systems launch new hepatitis B-focused initiatives. Hepatitis B became the market share leading hepatitis B vaccine for adults in the U.S. last year, and we plan to build on that position in 2024. We continue to expect record hepatitis B sales in 2024 with net product revenue expected in the range of $265 to $280 million for the year. Longer term, the U.S. adult hepatitis B vaccine opportunity remains significant with over 130 million patients eligible, one of the largest addressable patient populations in the U.S., with a vast majority remaining unvaccinated. We believe this translates to a market opportunity for HEPA-Sav-B of over $800 million by 2027, with HEPA-Sav-B poised to achieve a majority market share. We're also excited for several upcoming milestones from our novel vaccine pipeline, including the initiations of our Phase 1-2 trial for our shingles vaccine candidate, long-term follow-up data for our Phase 1 Tdap trial, and data readouts from our plague program. As a reminder, we look forward to our PDUFA action date on May 13th for the, for HEPLIS-FB supplemental BLA for vaccination of adults on hemodialysis, which is currently under review by the US FDA. In addition to this continued execution and bolstered by our strong financial position, we continue to assess opportunities to grow beyond our internal organic pipeline within the infectious disease space, which we believe would enable us to further diversify our product portfolio and create future commercial opportunities. As we've discussed previously, we remain committed to disciplined capital allocation focused on generating significant value and driving growth. We look forward to providing updates on these efforts in the future. I'll now turn the call over to Dawn and Rob, who will provide more details on the EPOSAB-B results and our pipeline progress, respectively, before Rita O'Connor reviews our financial results for the first quarter. As previously announced, our CFO, Kelly MacDonald, is currently on maternity leave, as Rita has stepped in as interim head of finance. supporting me in my temporary appointment as principal financial officer until Kelly's expected return in August. Don, can you take it away? Thank you, Ryan. In the first quarter of 2024, HEPLIS-IV achieved strong net product sales despite headwinds that affected the non-respiratory vaccine markets, including hepatitis C. On our last call, we said that growth in the U.S. hepatitis C vaccine market was expected to be flat during the first quarter, due to an extended cough, cold, and flu season. As expected, these dynamics played out, ultimately reducing the opportunity for adult vaccination in Q1, leading to a slight decrease in the hepatitis B vaccine market compared to the fourth quarter of last year, and a flat year-over-year growth compared to the first quarter of 2023. This dynamic has been observed across other non-respiratory vaccine markets as well. Headless FBE continued to increase its total U.S. market share year-over-year, achieving an estimated 41% market share in the first quarter compared to 37% during the same period last year. Net product revenue in the quarter grew 10% year-over-year compared to the first quarter of 2023. This sales growth continues to be driven by Headless FBE's strong performance in two critical segments, retail pharmacy and integrated delivery networks, or IDN. We estimate these segments will drive significant growth and represent over 60% of the total adult hepatitis B market in the U.S. by 2027. In both segments, Hepatitis B's first quarter estimated market share increased to approximately 55% compared to approximately 49% during the same period last year. Despite the softness in the market in the first quarter, we continue to see indicators of U.S. market expansion from the ACIP universal recommendation for adult Hepatitis B vaccination, reaffirming our confidence in a sizable market opportunity and long-term revenue growth potential for Hepatitis B. Large health systems and providers are gaining awareness and agree they need to act on the ACIP universal recommendation. Many large systems have committed to launching new Hepatitis B focused initiatives over the next several quarters to effectively implement the recommendation. over half of our targeted IDN universe has increased hepatitis B dose volume year over year. While system-level changes take time to enact, we are encouraged by the progress we see as our systems work to implement operational changes to support routine adoption of the ACIP universal recommendation. In the retail pharmacy segment, we have made meaningful progress with several large national chains, slicing hepatitis B in a preferred position among adult hepatitis B vaccines. Despite the slow start in Q1, retail customers are mobilizing around the opportunity of hepatitis B vaccination. Several customers have indicated a clear shift away from respiratory vaccines to a focus on non-respiratory vaccines, such as hepatitis B. Given these positive trends and customers' commitment to prioritize hepatitis B vaccination for the rest of the year, We are forecasting the retail segment to meet our annual expectations for 2024 and make a considerable impact to HEPA-Savvy's success this year. As Ryan noted, we are reaffirming our full-year 2024 net product revenue guidance for HEPA-Savvy to be in the range of $265 to $280 million. As mentioned, We've already seen signs of the market strengthening early on in Q2 as the focus of healthcare providers and retail pharmacies shifts back to prioritizing non-respiratory vaccines. We are extremely confident in the long-term expansion of the U.S. hepatitis B vaccine market and forecast annual market growth of approximately 10 to 15% over the next several years, with hepatitis B gaining meaningful increases in total market share over that time. We continue to expect the hepatitis B vaccine market opportunity for Hepatitis B to grow to over $800 million in the U.S. by 2027 from approximately $525 million in 2023. In summary, we are reaffirming our confidence that Hepatitis B will strengthen its position as a clear market share leader in the expanding hepatitis B vaccine market, and we expect 2024 will be another year of record sales and continued growth. We are very proud of our commercial team's execution in establishing headless FBE as the market share leader in the U.S., and we look forward to continuing this momentum in the remainder of 2024. I will now turn the call over to Rob to take you through our clinical pipeline.