Novavax, Inc.

We will take our next question from the line of Paul Kuhn at TD Cowan.

Thanks. Congrats on the quarter, guys, and thanks for the question. Paul Kuhn here.

I'm wondering if you guys could provide any additional color on your potential clinical trial design for C. diff vaccine in phase one. Primarily, what endpoints are you guys going to be looking at and what do you want to see there before initiating a phase three trial? and then just curious if you guys have embedded any potential phase two or three CDIF costs in your 2028 operating expense framework. Thank you.

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

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

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

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

Great. Thanks, guys.

Next question will come from Pete Stavropoulos at Cantor Fitzgerald.

Good morning, John, Jim, and team. Congrats on the progress, and thank you for taking our questions. First one that I have. First question that I have is, you know, this will be the full, it will be a full commercial year for Nevaxavit under Sanofi control, as you mentioned. How much of the 2026 COVID vaccine uptake assumptions depends on contract wins versus physician-patient driven uptake, you know, including the DTC outreach that was mentioned?

Jim, you want to take that one?

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

All right, thank you for that. And just one additional question. Sorry, John, were you going to say something?

No, just to build on that, they're also, though the U.S. is the most important market, its primary market, they're also launching in other markets this year, like Canada, Germany, United Kingdom, and it'll be a global footprint over time that continues to expand. And like Jim said, long-term methodical investments. And Elaine, you had one additional point to add.

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

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

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

Thank you for taking our questions, and congrats on the quarter.

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

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

Jim, maybe you could take the question on guidance.

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

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

Yeah, the vaccine that Santa Fe will be offering Distributing in the U.S. and beyond matches the strength selection of the U.S. and other regulators.

Yeah, we're on track for delivering doses to Sanofi.

Very good. Thank you.

We'll take our next question today from Tom Schrader at BTIG.

Good morning, everyone. Thanks and congrats on all the progress. Returning to C. diff, kind of a broader question. Is that a treatment vaccine? Is that a prophylactic vaccine? Can you give us a little sense of if it's prophylactic, who it would be for? Is there a clear population that's had a lot of infections? And then separately on your oncology vaccines, we all know those are hard. Do your partners want Matrix M as it is for these programs, or are they all asking for licenses to kind of use the components of Matrix-M and kind of experiment. The question is, are you close to the final adjuvant in oncology vaccines or are you licensing people to do research in adjuvants related to Matrix-M? Thanks.

Bob, why don't you take the question on C. diff first?

Yeah, so with C. diff early days and generally, I think the general philosophy is that we're looking at preventive vaccines.

Okay.

But, you know, we're developing the database as we speak. So, you know, we'll consider all the various options.

And on the second question, Tom, regarding Matrix, look, we have reason to believe we're optimistic about what we're seeing early on. Novavax is engaged. We are engaged in internal research and experiments with Matrix in oncology across multiple target types, and we're looking forward to generating additional data. We've seen some early data that encourages us, but we're not ready to share that in the public domain yet. But as you can imagine, we use data of that nature and data from some of our earlier partnerships in the past that involved oncology to interest and entice a recent partner who signed up with us through an MTA in a collaboration who's a top 10 pharma company and a global leader in oncology. They are also in a position to explore MatrixM, across a variety of oncology targets. So we look forward to them engaging and then completing that work, to our own work coming to fruition. What we're seeing so far, we're very encouraged by, and we believe that some of the early data we were able to share under NDA with that collaboration, that partner through that collaboration encouraged them to take a look as well, and they're a leader and an expert in oncology. It's absolutely exciting. We appreciate the energy of your question and wanting to learn more. We look forward in the future to sharing some of what we're learning as we continue to build the library of knowledge and evidence around the potential for Matrix in this arena. Thank you. All right. Thanks for the detail.

I appreciate how competitive this all is.

We'll move next to Jeff Meacham at Citi. Please go ahead.

Hello, guys. This is Nishant Vaughan for Jeff. Thank you for taking our questions. Going back to the combo vaccine, I know you mentioned Sanofi's intent to pursue, but, you know, given the recent leadership change there and the portfolio review, what tangible steps from them give you confidence that the combo vaccine remains a strategic priority? And are there any remaining internal decision points before the CAC trial starts? Thank you.

Could you repeat the question, please? We had a little bit of audio difficulty here. Thank you.

Yeah, so on the combo vaccine, I know you mentioned, you know, Sanofi's intent to pursue the combo vaccine, but, you know, there has been recent leadership change over there and then the portfolio review. What tangible steps from them gives you confidence that the combo vaccine remains a strategic priority? And are there any remaining internal kind of

Thank you for your question. So, to paraphrase that then, internal change at Sanofi, new CEO, new head of R&D, promotions, in fact, of the global vaccine head was promoted and got even more responsibility. They're leaning in, not away, as Jim said and as I said. If anything, we're seeing more engagement behind the scenes from Sanofi rather than less, despite the changes. In fact, perhaps even with those changes. So we're really encouraged, more so than ever before. And by the way, we do not speak on behalf of partners. We are extremely cautious and conservative in what we say about the intentions of those we're working with. A part of our strategy, it may be frustrating at times for investors who'd like to hear more sooner, of course, but we can't share many of the things we know that our partners are working on and doing because we're under NDA. When we do make a comment like we have about Santa Fe's commitment about their intention to be one of the first in the kick combination arena market in the U.S. and that they're in late stage discussions with regulators, those words are signed off on by our partner. They are provided to us by that partner and we are enabled to then share it with you. So those words are coming from Sanofi themselves. Any further questions about it, you definitely ask them when you circle with them. But what we see behind the scenes is leaning in, stronger commitment, a strong understanding of our technology and its capabilities. They're an outstanding partner and we're excited about the potential of the partnership as we continue to move forward.

Thank you. And then follow up. Is the combo vaccine like the phase two trial start in 26 still the base case? And what exactly needs to happen for you to earn the $125 million milestone? Thank you.

We don't guide to timing of our partners on studies. Jim, did you want to comment on milestones?

Well, reiterating we don't guide. However, we agree it's going to be an exceptionally important catalyst for us. And in fact, you know, when you think about I was talking about the size of the global vaccine markets, when you combine COVID plus flu together. So think about it. We're talking about two, five, six billion dollar marketplaces. You turn this into a top one, top two market. It makes sense to invest. It just does. and so we believe that this advancement to phase three, when Sanofi makes that announcement, is a really important unlock of value creation for our company.

Thank you. We will hear next from the line of Hardik Parikh at J.P. Morgan.

Hey, everybody. Thanks for the question. There's a couple of high-level ones. One is just on the COVID Jim, Bob, and Elaine, you want to address the first part of the question?

I really appreciate the question because what it does is ask, hey, talk about the burden of disease and the significance and the importance of continued vaccination and the vulnerability of certain age groups, in particular the over 65. You know, something I would point any investor or anyone to is the recent BRBPAC where manufacturers shared and, of course, industry experts shared that just the continued burden of disease, especially in that over 65 when it comes to deaths, hospitalizations. And as that continues, we think we're seeing broadly continued investment in kick programs across major vaccine manufacturers for that reason.

Yeah, in fact, GSK made commentary about their intentions around a combination vaccine in their recent earnings call. We've seen Moderna get approved in Europe. We just saw the flu approval in the U.S., which bodes in a positive way, we believe, in the U.S. marketplace for seasonal infectious disease arena. Elaine, additional comment?

Elaine O' The only thing I was going to address, Hardik, is I think the second part of your question, and we do not provide guidance to Sanofi on their kick program. As John had mentioned earlier on in the Q&A session, we have separate Thank you.

And a final reminder to our audience, that is star and one if you would like to ask a question. We will hear from Mayank Mantani at B. Reilly Securities.

Yes, good morning, team. Thanks for taking our questions. I appreciate you squeezing us in. And on the partnership front, you know, you have had many updates. Maybe just quickly on the mRNA flu label, you know, and the regulatory progress that we've had in the recent months, I was really interested to hear your specific thoughts and implications on how, you know, a phase three kick or even a flu program, Next Generation, you know could be designed and is there an accident approval path in a 65 plus age group based on a immunogenicity surrogate endpoint if you could maybe just comment on that and then on the Pfizer partnership, I know you're contractually restricted to talk about the fields that they're working on, but I was just curious if anything to watch out for coming there, if you could just give some update there. And lastly, on the 30 plus fields under evaluation, really curious to hear, how maybe quarter-over-quarter or year-over-year some of these evaluation work is progressed, you know, and timelines for, you know, moving into a licensing kind of format, how that's kind of progressing, that would be very helpful.

All right, three questions from Mike. Bob, did you want to take the first one on his question regarding label and flu and any read-through to kick programs in the U.S. marketplace?

Just, you know, commenting at a high level, The fact that we've seen this recent activity from the FDA I think is encouraging. The flu vaccine plays in the same space where we are in terms of seasonal respiratory virus vaccines. So it's encouraging for all of us to see progression in that space. And I'll just maybe leave it there.

Colleen? Thanks, Bob. Thank you. For the second part of the question regarding the Pfizer partnership, we continue to collaborate with Pfizer and uphold our commitments based upon the license agreement that we have with Pfizer. And we're very, very excited about the progress that's being made. Can't speak any further to that, but we continue to support that partnership. And then the third part of the question was the 30-plus field. that spans both infectious disease and oncology. And we're, again, very, very, very excited about the progress that's being made across the board with MatrixM in these experimentations. You know, each MTA is different. Partners evaluate different indications. They conduct different experiments, and they move with different timelines. Hard to say yet where that will end, but we're very, very excited about that progress. We don't guide to specific timing as any specific MTA really depends on the partner and how they conduct their experimentation. Thanks for the question.

And regarding oncology, just one other comment that I think Tom, back to Tom's question on MatrixM, we found the final version of MatrixM for oncology. We believe MatrixM in and of itself as it stands today has potential in that arena and we're exploring deeply its potential there. We're also looking at other approaches utilizing Matrix to expand the utility of it, add it to other things in addition. to see if we can broaden the utility both within infectious disease and in oncology. So we're turning over every stone. We're encouraged by what we're seeing across that front. But we really believe that the core matrix M as it stands today has remarkable potential across a wide array of diseases. Jim, one other comment.

Hey, Mike. I tell you what I really like about your question is that what you're highlighting is that beyond the forward-looking catalysts that are in the control of Novavax, for example, entering the clinic with C. diff, some of the work we're doing on oncology have proof points. We have on a forward-looking near-term basis some really rich partner catalysts that also are critically important to unlocking value here in our company from major players. I mean, you're describing Sanofi, you're describing Pfizer, you're describing new emerging deals that can occur. And so the combination of those two, what we're doing ourselves, plus the catalyst-rich partner activities in the future, are some of the things that we're very excited about here.

Actually, since you mentioned, you know, applications of MatrixM, very quickly on the GSK's Shingrix dementia program, you know, they're launching a big one. I remember you've been working preclinical program on shingles. Maybe just give us an update on that and if that, you know, is part of any of these partnership frameworks you're working on. Thanks again.

Yeah, so, you know, we too are intrigued by some of those observations. I'll just, you know, again, indicate that these are observational studies. They're hypothesis generating. So, you know, work remains to be done to really nail down whether or not there's a true causative association there. We, as you know, have a VZV candidate that we're developing still. Early, we're working towards confirming a lead candidate, and then our intent is to partner that program.

Great. Thank you, Dean.

And that concludes our question and answer session, and we do thank all of our participants who signaled today. Mr. Jacobs, I'm pleased to turn the floor back to you, sir, for any additional or closing remarks that you have.

Just a sincere and deep thank you to all of our employees at Novavax for their contributions. The efforts and the energy that they put into this every day and their passion to really help make a difference in the world for global health through our efforts and our energy and to create a legacy we can all be proud of and a deep thank you to all of our investors. from our largest investor to our smallest. We appreciate each and every one of you, the belief in our technology and the confidence and patience you show as we continue to execute against what we believe is a robust strategy that has the chance to deliver significant value for all of our stakeholders. Thank you for your attendance today, everyone.

Ladies and gentlemen, this does conclude this Novavax second quarter, 2026 financial results and operational highlights conference call. We thank you all for your participation. You may now disconnect your lines and have a great