Valneva SE

Good day and thank you for standing by. Welcome to the Valneva's Full Year 2023 Results and Business Update conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1, 1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw a question, please press star 1, 1 again. Please be advised that today's conference is being recorded. I would now like to hand over to the speaker today, Joshua Drum, VP Global Investor Relations. Please go ahead.

Thank you. Hello, and thank you for joining us to discuss Velnymo's full year 2023 results and corporate updates. It's my pleasure to welcome you today. In addition to our press release and analyst presentation, You can find our consolidated financial results for the 12 months ended December 31st, 2023, which were published earlier today, available within the financial report section on our investor website. I'm joined by Valneva CEO, Thomas Lingelbach, and our CFO, Peter Buehler, who will provide an overview and update on our business, as well as our key financial results for the year. There will be an analyst Q&A session at the conclusion of the prepared remarks. Before we begin, I'd like to remind listeners that during this presentation, we'll be making forward-looking statements, which are subject to certain risks and uncertainties that could cause the actual results to differ materially from those expressed or implied by these forward-looking statements. You can find additional information about these risks and uncertainties in our periodic filings with the Securities and Exchange Commission and with the French Market Authority, which are listed on our company website. Please note that today's presentation includes information provided as of today, March 20th, 2024, and Valneva undertakes no obligation to revise or update forward-looking statements except as required by applicable securities laws. With that, it's my pleasure to introduce Thomas to begin today's presentation.

Thank you so much, Josh, and welcome to today's call. Yeah, the year 2023 was not a year without challenges. but also a year with many achievements we are proud of. We made excellent progress across our R&D pipeline, and of course, 2023 was our chikungunya year. We got FDA approval for the world's only and first, you know, chikungunya vaccine, and very recently, ACRP recommendation and respective adoptions. We enrolled the phase three study with Pfizer online completely. And we are just about to re-entering phase one with the second generation Zika vaccine. And I'm going to go into more details on all of those programs. We have seen significant growth of our commercial business products that surpassed pre-pandemic phase by 12%. and 2022 sales by 26%. Both Xiaro and Zucoral, our proprietary brand, grew more than 70% respectively versus 2022. And overall product sales grew 63% versus 2022, excluding the COVID-19 sales, and Peter will go into much more detail. We are solidly funded with a strong mid-term financial outlook. We had more than 120 million euros catch at year end. We augmented that with close to 100 million net proceeds from our P&V sale early this year. And very recently, we extended the repayment of our interest-only period of the assisting loan facility which, of course, results in a significantly lower cash burn for the company. The operational business is, therefore, considered sufficiently funded, excluding debt repayment, of course, at a certain point in time, until the line commercial revenues enable a sustained profitability . When we look at the business in more detail, I would like to start this time with our strategy. Where do we see this company going? And as we have said already more than 10 years ago when we created Valneva, our strategy is to become a globally recognized vaccine company, fully integrated, focused on the development, manufacturing, and commercialization of vaccines in areas of unmet medical needs, contributing to our vision to a world where no one dies or suffers from a vaccine-preventable disease. We see our strategy in three key pillars. Number one, a driving commercial growth. With the recent approval of Ixtchik in the United States and our expected forthcoming approvals in other territories, we see really the opportunity to unlock Ixtchik value by building awareness and markets and growing things. We hereby capitalize on the bundle effect within our existing travel business. We will further expand global reach more addressing low-medium income countries through partnerships. And with a change in the overall setting and the portfolio and more focus on proprietary products, we see really cash flow positivity from the commercial business 2025 onwards. The second pillar is to capture our R&D upside. We will continue investing in new vaccines that address high unmet medical needs. And we will leverage our proven R&D engine and strategic partnerships. And we believe we are well positioned to do that, having developed three vaccines in the meantime, from early discovery to licensure. We will continue focusing on vaccines that can make a difference. First, only best. and we will generate meaningful catalysts for our investors targeting the next phase three entry post-life. We will maximize our integrated business model. We believe we are one of the very few companies left in the proof-by-vaccine space that can really build on an integrated model, which means we will build continual value from the end commercial execution We will support the timely approvals of our Lyme vaccine, which we continue to see as the single largest catalyst going forward. And by doing so, we see the possibility to achieve sustained profitability with potential successful commercialization and revenues online from our partner, Pfizer. When we look at Ixchic, the world's first and only chikungunya vaccine, It's FDA-approved in adults. More additional regulatory approvals are expected this year. It's a live attenuated vaccine that offers strong and long-lasting protection from a single shot, and we target a minimum of five years here. The FDA approval triggered also the PRV, which we sold, as I mentioned earlier, and the ACRP recommended the vaccine for certain travelers and laboratory workers. The U.S. launch is well underway, and we are selling through our existing and proven commercial infrastructure. Going forward, we see three key segments in terms of market opportunity. One, of course, travelers. military but also an opportunity for stockpiles given that chikungunya is on the list of potential outbreak preparedness diseases. We will continue leveraging partnerships for Latin America and other LMICs and with more visibility on the travel sector, the awareness around chikungunya, the market opportunity around chikungunya, we clearly see that the global market for chikungunya vaccine will exceed half a billion, with probably 300 to 400 million represented alone by the segment I was talking about earlier. In terms of upcoming milestones, I mentioned the additional anticipated approvals, EMA, Health Canada, and then MISA in Brazil. And we will, of course, also initiate the regulatory process in the UK. Towards the latter part of this year, we will, you know, further go through the clinical development, mainly the Phase IV clinical program, but also other clinical activities, e.g., in the pediatric field. And as we generate more and more data, we will undergo filing for potential label expansion. I mentioned already that our CHIK vaccine has a very differentiated target profile. It shows a rapid and long-lasting immunity across all age groups tested. And here, I would like to specifically point out that the vaccine has very, very high zero protection levels, including the most vulnerable population, namely elderly above 65 years of age, which has been specifically mentioned in the CDC adopted ACIP recommendation. We have close to 100% zero response rates after the single vaccination, and it has been maintained at a very high level over time. We got data already up to two years. We will generate data up to three years. And on safety, the vaccine is generally well-tolerated. Of course, it is a life-attenuated vaccine. Life-attenuated vaccines have the advantage that with a single shot, you have a very long protection. But there is a certain level ofogenicity. But this is absolutely in line with other well-established life-attenuated vaccines in the market. We reported adolescent trial data and this data suggests a favorable safety profile regardless of previous chickpea infection. Turning to our Lyme disease vaccine candidate VLA15. It is today the world's leading vaccine candidate against Lyme disease. It's the only program in advanced clinical development today. By way of reminder, it is a multivalent recombinant protein-based vaccine that targets the six most prevalent serotypes of Lyme borreliosis in the Northern Hemisphere. It follows a proven, established, and validated mode of action. It got U.S. FDA PASDA designation. And as I mentioned at the beginning, the Phase III Pivotal Efficacy Study is now fully enrolled. The program is partnered with Pfizer They have an exclusive worldwide right to commercialize the product, and we anticipate the market opportunity to be north of $1 billion. We have already received under the partnership with Pfizer certain milestone payments, but overall we are eligible for milestones up to $408 million. And upon successful commercialization, tiered royalties from 14 to 22%. When we look at the upcoming milestones, which are in the short term, all execution related, of course, we will, and this is an important point when we talk later about the financials, complete our financial contributions to Pfizer in the first half this year. Then on the execution side, we expect a complete full vaccination for the cohort one and the primary vaccination for the cohort two, meaning the cohort one will have received three doses priming plus a dose booster. We will later in the year see the two-year antibody persistent and booster results, which will give us a better indication as to whether this vaccine will require an annual booster later or not. And as guided many, many times, we expect efficacy results from the phase three trial at the end of 2025, which, and if successful, will support regulatory filings which we currently foresee in parallel in the United States and Europe in 2026. Slide 12 of the presentation shows one more time the Phase III efficacy study design. You remember that following initial operational issues, we split it in two cores within one study. Roughly 50-50, we have now enrolled more than 9,000 participants. The study is randomized one-to-one vaccine against placebo, two-to-one North America versus EU. And the primary endpoint is the rate of confirmed Lyme disease cases after two consecutive tick seasons. And when I mentioned earlier, full vaccination to be expected for cohort one is imminent. And then, of course, for cohort two, the booster vaccination will come next year. Turning to Zika, I mentioned at the beginning that we have decided to re-enter clinical development of Zika vaccine. We are leveraging what we call our optimized second-generation platform, which is a platform that originates from our Japanese best-for-life vaccine, Xero. got further than extended and optimized for our COVID vaccine VLA 2001. And we believe that this second generation activated, inactivated whole virus vaccine platform is perfectly suited for Zika. And so Zika is, as many of you know, also transmitted by Aedes mosquitoes. We all have experienced and have seen the devastating impact that Zika infections can cause. And today, there are no vaccines or specific treatments available. It is a PRV-eligible disease, and there is potential funding from public institutions. And we see there are really opportunities given the emerging epidemiology around Zika. In terms of next milestones, we will execute the phase one clinical trials with the enhanced process and optimized vaccine formulation, and then we will decide on the further development strategy, considering the results, of course, more insights around the market opportunities and external non-diluted funding. With this update on the business, I would like to hand over to Peter to provide us with the financial report.