Valneva SE

Hello and thank you for joining us to discuss Valneva's first half 2024 results and corporate update. 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 six months ended June 30th, 2024, which were published earlier today, available within the financial reports section on our investor website. I'm joined today by Valneva's 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 first half. 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 will 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, August 13th, 2024, and Balneva 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, Josh. Good day, everyone. It's a pleasure to present to you, together with my colleagues, the great achievements that we have been able to deliver on in the first half of this year, most notably in R&D and strategic development. Peter will develop the financials more in detail, but product sales of 68.3 million euros included first recognized sales for ixtric. and we're overall in line with our anticipated supply and sales phasing, and hence we have reiterated our set of full-year financial guidances. The successful sale of our priority review voucher and the deferral of our loan reimbursement in the first quarter allowed us to maintain a solid cash position, and now that we completed for the Lyme disease program, we anticipate a significantly lower cash burn towards the latter part of the year. We achieved major things in R&D, as I mentioned at the beginning. And the first one, of course, the new Shigella vaccine. Most recently, we entered into a strategic partnership to accelerate the development of the world's most advanced tetravalent Shigella vaccine. Additional approval in Canada and Europe were obtained even from planning. which allows us to launch in first markets in the last quarter of this year and we have pending approvals in the uk and brazil we are very grateful that we have been able to extend our partnership with tippy who awarded us a new more than 40 million grand to support product access post marketing and label extension trials for exchange We reported positive phase three H6 data in adolescents, which will all be used to support our label extension submissions in the second half of this year. We also published two-year antibody persistence data in Lancet, which are also expected to support further label extensions. And as you know, this study is going on for roughly five years. We completed the enrollment in Phase 2 study of ixchic in children 1 to 11 years of age, completed the primary vaccination in our Phase 3 Valor study for Lyme disease, and hence we are fully on track for the first readout at the end of 2025. And as you know, and as reported already at the last quarter, we initiated the phase one for our second generation Zika vaccine candidate with data expected in the first half of this year. Let me draw your attention to page number six of the presentation, which is a recap of our NEVA strategy. You know that our aim is to become a globally recognized vaccine company in line with our vision, contributing to a world where no one dies or suffers from a vaccine-preventable disease. Our strategy is based on three pillars. On the one hand side, driving commercial growth. Here we see clearly XJIC and the possibility to unlock the XJIC value by building awareness and market, capitalizing on the bundling effect with existing travel business and expanding globally, reaching more LMIC territories via strategic partnerships. And this commercial business is expected to become cash flow positive from 2025 onwards. The second pillar is our R&D. And here we would really like to capture R&D upside and provide upside to our investors by leveraging our proven R&D engine and existing strategic partnerships. We continue to focus on vaccines that can make a difference. As you know, technology agnostic, striving for first only a best in class solutions. and execute efficiently to general meaningful clinical catalysts. The new example, Shigella, is a vaccine where we expect phase three to enter once Lyme hopefully will be successful. The third pillar is really the maximization of our integrated biotech model. You know, we are one of the very few pure play vaccine companies that have a fully integrated model from research to sales. and we build on continual value from R&D and commercial execution. Of course, we support the timely LIME approvals, and on the back of that, we may achieve sustained profitability with potential VLA15 commercial revenues from our partner, Pfizer. When you look at our pipeline, you see that the introduction of the Shigella program through the strategic alliance with Limatech has helped us really to build a very coherent pipeline with strong and advanced clinical candidates. Of course, with Lyme as the number one in our pipeline and clearly the most attractive value player. Then Chikungunya with ongoing clinical activities, be it phase three, be it phase two pediatric, be it phase three adolescence, and also phase four. With Shigella, which I'm going to develop more in detail, but with a first phase two CHIM study, controlled human infection model and pediatric studies to begin in the second half of this year. And then with Zika, which could be a very nice plug and play within our existing travel vaccine portfolio. And as reported in the past, our key focus areas in preclinical are circled around EBV and various enteric disease programs. When we look at ixchic, the world's first and only chikungunya vaccine licensed today, we have really a very unique product here. We expect to benefit by being first to market And we believe we have a differentiated and competitive product characterized by very strong and durable immunological response following a single injection. And very importantly, we have shown that there is no difference in immunogenicity between younger and older adults. The vaccine has been generally well tolerated amongst the more than three and a half thousand adults and more than 700 adolescents evaluated for safety so far. When we look at the US launch success and where we are right now, we made some recent achievements. We launched the unbranded traveler campaign to build consumer awareness, the DHA, IHD, adopted the CDC recommendations and published the chikungunya virus and vaccine guidances. And we are continuously growing our customer base, distributors and customers reordering ixchic already. What's coming up? Of course, this is a quite challenging endeavor because we are talking about a brand new disease. Brand new vaccine, so we are investing significantly in building awareness, building recommendations, building adoption. And as next steps, we see really the publication of the chikungunya vaccine recommendations in MMWR, which is still pending. Continue working with CDC to raise awareness of global threats, including recent significant cases in Brazil. And the ACIP is expected to discuss guidelines for endemic island regions, EIE, Puerto Rico, and the review is planned for October this year with a vote in February of 2025. And when we look at the territory expansion, you see already on slide 11 that we have many boxes ticked. U.S. done, of course, label extension. for adolescents, pediatric, but also antibody persistence is coming up. Canada, we got the approval also there. Label extensions will follow. In Europe, everything so far achieved according to plan, slightly ahead of plan, as I said. MHRA approval still outstanding for the UK. And then also here as next steps, post-licensure label extension submissions. We have the Brazilian licensure process ongoing, and we are targeting additional markets with established travelers markets, but also additional LMIC territories, including on the basis of WHO pre-qualification. When we look at the ongoing clinical activities, which as I mentioned at the beginning, are supported by the new more than $40 million CEPI grant. We have the post-marketing effectiveness study, phase four, which are in reality two studies, one observational effectiveness study in participants greater than 12 years of age in Brazil, and a so-called pragmatic randomized controlled effectiveness and safety study in adults in an endemic country with roughly 20,000 people. The label extensions I mentioned already, we completed the phase three successfully for adolescents. and the phase 2 for children 1 to 11 years of age is already fully enrolled. The ongoing antibody persistence and long-term safety study in adults is a very important study because it will further substantiate our hypothesis that this vaccine after a single shot will protect at least for five years. And then we have another study that we have been working on in potentially immunocompromised adults. When we look at Lyme, as I said, we consider Lyme the single largest value driver in Valneva. It's the only Lyme disease program in advanced clinical development today. You know, you have heard it many, many times, but it's a multivalent recombinant protein-based vaccine covering the six most prevalent serotypes of Lyme borreliosis in the Northern Hemisphere. It's based on an established mode of action, outer surface protein A and anti-OSPA antibodies able to basically kill the spirocytes in the midgut of the tick. And the single largest achievement in the first half of this year has been the completion of the primary vaccination enrollment. Great achievement by the joint teams at Pfizer and Valneva. You remember that we have estimated the market to be above 1 billion in sales. And as you also know, Balneva will be eligible for upfront and milestone payments up to more than $400 million, of which we received thus far 165. There's a tiered royalty model in place subject to sales levels in between 14 and 22. There are a couple of key important milestones coming up. We completed our cost contribution to the Lyme program in the first half of this year, as I mentioned during my introduction. And we expect the two-year antibody persistence and booster results in the third quarter this year. This is just by way of reminder, this is immunogenicity data post second booster. So it will give us an indication about the necessity for annual boostering. And of course, with all of that, we are on track for the phase three readout at the end of 2025 with regulatory filings expected in 2026. Page number 15 shows again the The overall study design of the phase three efficacy study, which is a placebo-controlled randomized study, one-to-one randomized against placebo, two-to-one North America versus European sites. And the primary endpoint is the rate of confirmed Lyme disease cases after two consecutive tick seasons, meaning primary immunization plus first booster with a secondary endpoint, including the efficacy after the first Lyme season, meaning after the completion of the primary series. So overall, we are very excited about the progress around Lyme, and we are very grateful to our partner Pfizer that we will be able to manage the study according to our guidance and plan. When we look at Shigella, as I mentioned during my introduction, it is a wonderful opportunity that we have generated here through the strategic partnership with Limatech. The product candidate is called S4V, and it is really a unique opportunity to develop a first-in-class vaccine for a life-threatening disease. It is the most advanced tetravalent Shigella program in the world. It's based on a so-called bioconjugation technology and has the potential to cover up to 85% of the Shigella infections. The license that we have entered into as part of our strategic partnership with Lima Tech It's a global one, and the vaccine candidate is, as I said, a four-valent covering the most pathogenic Shigella bacteria serotypes. Limatech already reported positive phase 1, 2 clinical data, including robust immunogenicity and favorable safety and tolerability data. We estimate the market opportunity for a Shigella vaccine to exceed half a billion dollars annually. And it's a wonderful plug and play because we are seeing here a very similar commercial footprint, namely travelers and military from high income countries, but LMICs as well, and here specifically children living in endemic countries. It is the second leading cause of fatal diarrheal disease. up to estimated more than 150 million cases and more than 600,000 deaths are attributed annually to Shigella. And therefore, it has been identified as a priority vaccine by WHO. In terms of upcoming milestones, I mentioned at the very beginning of this call, we will soon start the phase two, the first phase two GIM study. GIM means Controlled Human Infection Model, so it's a human challenge study. in the US in adults and phase two pediatric study in LMICs. Both will be led and conducted by Lima Tech. Before then, Valneva will take over further activities. We will start already working on a couple of things immediately, like CMC and regulatory activities. And of course, given the exclusive global license nature, we will be responsible for worldwide commercialization if approved. The page number 18 shows the overall key terms of the strategic partnership with Limatech. And here you see basically how the partnership works. So Limatech receives an upfront payment, is eligible for future milestone and royalty payments. The upfront payment is 10 million euros, and all the further development regulatory and sales-based milestones will go up to 40 million. There's a low double-digit royalty on net sales in the travel segment and additional payments and single-digit royalties based on commercialization in NMICs. As I mentioned, it's a true partnership. So, we collaborate through the phase two. LIMATECH conducts the first phase two human challenge study, which is a challenge with Sonae serotype. the pediatric immunogenicity study. Then Valneva will take the lead and initiate a second phase two GIM study against the second serotype, namely FLEX2A. And of course, Lima Tech and Valneva have already started working on tech transfer and the IND will be transferred to Valneva once all phase two studies are fully enrolled. And then, you know, Valneva will lead and manage all future development activities. So overall, we are really excited about this fantastic opportunity. You may recall that augmenting our R&D pipeline has always been one of our strategic objectives. And therefore, we are thrilled that we found an opportunity for a potential first-in-class vaccine for a life-threatening disease. So fully in line with our mission and vision. So when we talk a little bit about Zika, you know that we started a phase one study with our so-called optimized second generation vaccine candidate, VLA-1601. It should in reality call VLA-1601.2 because it's a second generation, activated inactivated whole virus. We are leveraging here the platform that we originally developed for Xearo, then further optimized for our COVID vaccine VLA2001 and upscaled. So we use a like-for-like technological approach here. And as you know, the Zika virus is coming back. It's re-emerging. And it's another mosquito transmitted disease with devastating clinical effects. And there are no vaccines or specific treatments available. Also worth noting that Zika is PRV eligible and many different organizations are currently discussing potential funding mechanisms around Zika. In terms of upcoming milestones, Of course, we are currently executing the phase one study and subject to data. We will then consider the future development strategy in the first half of next year. With this remarkable progress on our R&D and strategic development front, we come to the financials and it's a pleasure to hand over to Peter.

Thank you, Thomas. And good morning and good afternoon to all of you. Product sales for the first half year reached 68.3 million euros and on a comparable basis grew 7% over prior year. Including last year's sales of the COVID-19 vaccine, sales declined by minus 2%. The impact of currency fluctuation is neglectable. Total Ixiaro sales reached 41.9 million euros and increased by 38% over prior year. The strong year-over-year growth was primarily driven by sales to US military that were low in the first half of 2023. Ixiaro sales into the travel market also delivered growth over the first half year, despite supply constraints experienced during the first quarter. Ixiaro supply constraints were fully resolved in the second quarter. Ducoral sales declined year over year by minus 13% and reached 14.9 million euros in the first half of 2024. The decrease is mainly related to reduced marketing investment, as our new manufacturing site in Sweden underwent regulatory evaluation and approval. In terms of our ongoing launch of our new chikungunya vaccine, ixchik, we report sales of 1 million euros by June 30th in the United States. As a reminder, the ACIP recommendation for ixchik was adopted by the CDC in March of this year. In line with our expectations, third-party products declined by minus 37% year-over-year to reach 10.5 million euros. as a result of supply constraints. Moving on to the income statement, total revenues reached 70.8 million euros versus 73.7 million euros in the first half year of 2023. The decrease of 4% is driven by, as already mentioned, last year's revenue related to COVID-19 vaccine and lower revenues recognized from R&D collaborations as well as our prior year revenues related to the divestiture of our clinical trials material manufacturing site in Sweden. Looking at expenses, we observed a significant decrease in cost of goods and services from 53.8 million euros in the first half of 2023 to 45.6 million euros in the current first half year. Ixiaro gross margin reached 57.5% of Ixiaro product sales compared to 40.2% in the first half of 2023. In the prior year, the XCRO gross margin was adversely impacted by batch write-offs. Ducoral generated a gross margin of 34.8%, while third-party products yielded a gross margin below 30%. The total gross margin excluding XCHIC grew to 47.7% from 40% in the first half year of 2023. However, The total gross margin is also adversely affected by XCHIC-related overhead costs, as well as idle costs related to our new manufacturing site. In the second half of the year, we expect further gross margin improvements as supply shortages have been resolved. Research and development expenses increased from €26 million in the first half of 2023 to €29.7 million in the first half of fiscal year 2023. That increase mainly related to tech transfer costs for the transfer of our Ixchiaro and Ixchic manufacturing operations to our new Almeda site in Scotland, as well as higher R&D spent for Ixchic as we continue to execute ongoing studies. Marketing and distribution expense increased by approximately 15% to reach 23.2 million euros. The increase is related to increased launch costs related to our Ixchic vaccine that also include higher people costs as we expanded our commercial team. G&A expense were reported at 22.8 million euros and remained stable year over year. The sale of the PRV generated net other income of 90.8 million euros, which contributed to an operating profit of 46.7 million euros versus an operating loss of negative 35 million euros in the prior year. Adjusted EBITDA improved from minus 28 million euros to positive EPTA of 56 million euros. Now moving to slide 25. As discussed during our full year 2023 earnings release, we expect revenues to double by the time Lyme is launched. The main driver of this anticipated sales growth is, of course, the addition of sales derived from our XTRIC vaccine, but also expected continuous growth of XCRO. Next slide, please. We confirm our guidance for fiscal year 2024 with product sales of 160 to 180 million euros, other income of 100 to 110 million euros, and R&D expense of 60 to 75 million euros. It is to be noted that the addition of the Shigella program does not change our R&D expense guidance for the year. As we completed our contribution to the budgeted Lime Phase III trial, we expect a significantly lower cash burn in the second part of the year. We also confirm our mid-term guidance, including double-digit CAGR growth of XCR over the next three years and XGIC sales exceeding 100 million euros in year three of launch. With that, I hand the call back to Thomas.

Thank you so much, Peter. Yeah, let me conclude our presentation with slide 28. I mentioned all the key um news flow items during my uh update on the individual programs and activities but this is the summary of what we have still to expect on chick the upcoming potential approvals uh in brazil and the uk the submission for label extensions um you know related to adolescents um antibody persistence data and the initiation of the Phase IV clinical activities. Lyme, of course, a very important data set in the third quarter with the Phase II two-year antibody persistence and booster results. Then, of course, we hope that we will be on time to complete also all booster vaccinations ahead of the tick season 2025. And then the primary data readout at the end of 2025 says here study completion is not study completion because of course study continues for a longer time. But this is the primary endpoint readout and secondary endpoint readout. Then the additional news flow around the Department of Defense. We expect a new supply contract for Xero in the last quarter this year. And now with the newly augmented program, the initiation of the phase two studies, both the first CHIM study as well as the pediatric immunogenicity study in LMRC. And then, you know, go looking a little bit into the earlier part of next year, the phase one data for our second generation Zika vaccine. This concludes the presentation and I would like to hand back to the operator to take the questions.

Thank you. As a reminder, to ask a question, you will need to press star 1 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 1 again. We will now take our first question. Please stand by. And the first question comes from the line of Suzanne Van Woerthuizen from Van Lanshot Kempen. Please go ahead. Your line is now open.

Hi, team. Thanks for taking my questions. Maybe to start off on the XTIC launch, now with many approvals in the pocket in your first full quarter of sales in, can you walk us through which markets XTIC is available today to the end customer? and um can you expand on which territories you expect to be the most important contributors to sales in the future and uh yeah providing the path to your guidance of over 100 million within three years and then i have a follow-up good okay so then let me let me start uh off by the um so basically right now the vaccine is only available in the united

We got the approvals in Canada and Europe, as you know, slightly ahead of our own expectations. You may recall that we originally said we would launch XUS at the very beginning of 2025. We hope that we are now in a position to launch in selected European countries and Canada already in the fourth quarter. So all the preparatory activities are ongoing. You know that there's a lot to be done post-approval, you know, country-specific, and this is currently in the make. So to manage expectations, we expect, of course, sales to be very moderate in the ex-US countries in the fourth quarter because there will be a launch in the fourth quarter. We have not yet finally decided where we are going to launch first in Europe, but this is currently under evaluation and there are of course, the typical key travel vaccination countries in Europe. And there are also countries in Europe which have a higher base awareness around chikungunya than others. All of that is currently under consideration and hopefully we will be able to communicate around that very soon. When we talk about the sales expectation, we are still very confident about the overall market size and the growth projection that we gave, the mid-term growth projection that we gave for XCHIC. It is a bit too early to say how it's really going to play out. You may recall, we discussed it in the past, all travel vaccines in the past have shown an S-curve at the beginning. And so we have to see at which point we're really going to see the steep increase. As I mentioned during the presentation, we have still a couple of Things outstanding in the United States, MMWR being one, for example, very critical in order to facilitate the ICSI growth from a U.S. perspective. And then, of course, all the respective recommendations for the ex-U.S. countries and then the introduction in the LMS.

Got it. That's very helpful. And then my second question online, I wanted to follow up regarding the phase two two year antibody persistence data that is expected in the next quarter, or in this quarter, actually gave clarify what data set we're expecting here. This is a second booster compared to no second booster. Or Yeah, can you remind us what to expect for basically?

Basically, it's the same that we reported after the first booster. So basically, you have the vaccination schedule 026. Then you have one year later, we measured the immunological response pre- and post-booster. And you may recall that after the first booster, we saw a very, very significant anamnestic response. So the immunological response post the first booster was by a substantial factor higher than the immunogenicity after priming. Now we're going to look at the same situation one year later, which means month 30, which is the the second booster, so the immunogenicity data pre-booster, and then month 31, the immunogenicity data post the second booster. And here we will see how the immunological responses look like. We haven't seen the data yet, so it's hard to tell. But as you know, our current working hypothesis is that the Lyme vaccine will require an annual booster shot. And of course, this immunogenicity data will give you a very good hint around this.

Got it. And then allow me to squeeze in one more on Lyme. Can you remind us on the Phase 2 data and the Phase 3 setup, how you expect the immunogenicity levels to translate into the primary endpoint of preventing cases. And appreciating efficacy rates vary across different types of diseases that are prevented by vaccines. What efficacy percentage do you think is good for marketing a Lyme vaccine?

These are two... Very complex and very challenging question. So let me start with the first one. I mean, unfortunately, there is nothing like an immunological correlate at this point in time. But as we reported in the past, we see the immunological results You know, definitely in line with what prior vaccines have shown also, there is no direct comparability possible because of different assays, different vaccine constructs. But we feel confident also based on all the published, you know, animal data that our immune responses are definitely in line with or even better than what has been shown in the past. I think the other part on the prevention of the disease, we have discussed this a couple of times. We are in the efficacy study. We are measuring Lyme disease cases, hence we are measuring against the clinical endpoint. So rates of confirmed Lyme cases in the vaccine group as compared to the placebo group. I mean, what is a good, what is a bad efficacy result? I would say any result that would give a strong recommendation, I would consider a success. Don't push me for a percentage number. I'm not allowed to say something.

You got it. Thank you.

Thank you. We will now take our next question. Please stand by. And the next question comes from the line of Evan Wang from Guggenheim Securities. Please go ahead. Your line is now open.

Hey, guys. Thanks for the question. Two from me. First on XCHIC, can you provide an update on some of the launch metrics in the U.S.? ? just any additional commentary you can provide on the degree of, you know, how access and reimbursement progress is going, what we're seeing in terms of, you know, some of the initial restocking and active accounts you have. And then on Shigella, appreciate, you know, or happy to see, you know, that licensure. You know, can you just talk about some of the upcoming trials you have planned? I know, I guess first, you know, with the Lima Tech reported S40 results, When will we see that, you know, full data either in publication or in conference? And then with your planned Phase II immunogenesis study, can you remind us maybe how we should think about that trial design relative to the results that we saw from Kenya? Thanks.

So, many questions hopefully are able to capture those. So, I think on iXCHIC, We are really seeing, as you rightly pointed out, that we are having customers reordering ixchic, which is good because it means that slowly, slowly the vaccine is being taken up. I think it's a bit too early to really talk about this in detail. I think we have We have continued to grow the awareness of Chicken Gunja and XChick amongst HCPs. We also started to engage with customers. We have now sold doses across each of our sales channels, including a growing number of reorders, as I mentioned earlier. The number of customer accounts we are engaging with is growing as well. Additionally, we continue to see travelers proactively asking about CHIC, which is a fantastic achievement already right now. And access and coverage of XCHIC continues to improve. We had approximately 25% coverage last quarter, and now it's over 50%. And I think this is really an important step forward And as I said, there are a couple of things still outstanding, and there are some gating factors worth noting, including the fact that the ACRP recommendations for chikungunya have still not been published in the MMWR, which is important for driving broader reimbursement and prescribing of the vaccine by HDPs. So that's a little bit where we are on the ICSHIC front. When it comes to Shigella, I mean, We are at this point in time, so I start with the latter part of your question. I think the Lima Tech team is preparing for respective publication of their data pre-deal, meaning the Phase 1-2 study. I don't have the details, but you can easily reach out and ask them directly. Then when it comes to the development plan going forward, at this point in time, we have clearly presented with the deal that we expect the two phase two human challenge studies, so the CHIM studies against the two most relevant serotypes, the next steps in parallel to the immunogenicity study and safety study in PEATS, in LMIC. And then from there we have of course a first development plan, but we would like to get further validation through the regulatory agencies and therefore we hope that we will have a more precise potential development plan to licensure at our planned investor day in October this year. And this is where we plan to present this development plan in detail.

Thank you.

Thank you. We will now take our next question. Please stand by. And the next question comes from the line of Oscar Hafen Lam from Brian Garnier. Please go ahead. Your line is now open.

Hi, guys. Thank you for taking my question. So regarding exchange, I understand that the current focus and guidance is basically based on the travel markets. And I was just wondering if we could also expect in the near future some military contracts kick in, similar to what happened to Xario a few years back. Thank you, guys.

Yeah, so I think that's an excellent question. And quite frankly speaking, we are not yet entirely clear how the US military process is going to work, but most likely not in the same way we used to have it with ICSIARO because the military is not doing those kind of contracts anymore. But definitely the military part, and you saw that we had already a good achievement in that department The Defense Health Agency adopted the CDC recommendations, which is already a great achievement. And therefore, we expect the U.S. military to become a major customer in the United States. Okay, very clear. Thank you.

Thank you. We will now take our next question. Please stand by. And the next question comes from the line of Rajan Sharma from Goldman Sachs. Please go ahead. Your line is now open.

Hi. Thanks for taking my question. So, firstly, just on Ducrol, I just wanted to clarify the regulatory approvals that you're waiting for. Are they now resolved so we should expect kind of normal supply of Ducrol and normal marketing in the second half of the year? And I guess just related to that, Do you expect Ducoral to grow in 2024, given I think sales are down 13% year-to-date, and then I just have a follow-up on X-Tric too?

Yeah, maybe I take the first part and then I hand over to Peter to talk a little bit more about Ducoral performance. Just to avoid a misunderstanding here, we had some phasing issues around Ducoral sales because we were waiting for the approval of the new fill finish site in Sweden. We built a new fill finish site in Sweden as part of our COVID endeavor. And we replaced the old filling site with this brand new filling site. And this required certain regulatory approvals in all the markets where Duperral has been licensed. Therefore, we were also cautiously investing in, you know, marketing, sales and everything around that. And we had some phasing issues associated with the sales of Ducoral. That's just to avoid. We are not expecting anything anymore. We got all approvals. Everything is clear. And this will lead us to the full year. Peter, you want to say something about this?

With pleasure, Thomas. Hey, Rajan. So, you know, just to remind you, in Q1, Ducrol did grow, right? And we did say in the past we do expect Ducrol to continue to grow year over year. We haven't provided a specific number, but this has not changed given, you know, the H1 result. So we do expect growth on Ducrol.

Okay. Thank you. That's clear. And then just going back to ixtric, I'm just wondering if you could provide a sense of how many doses have been administered to date or kind of how much of that revenue number that you've reported is stocking?

Peter, do we have the number on that?

I don't think that we can... You know, Racha, so basically the way we account for ixtric for now is we really account for on a sell-through basis. So we only account when sales are made to the retailer or to the provider, which means there is little to no stock in the channel. So we do not book as we ship into distributors. We chose that just to avoid potential returns.

Okay, that makes sense. Thank you.

You're welcome.

Thank you. As a reminder, to ask a question, you will need to press star 1-1 on your telephone and then wait for your name to be announced. To ensure your question, please press star 1-1 again. We will now take our next question. Please stand by. And the next question comes from the line of Maury Raycroft from Jefferies. Please go ahead. Your line is now open.

Hi. Congrats on the progress, and thanks for taking my questions. For XCHIC, I'm wondering if you can talk about any unique strategy for what you're doing during this time to gain advantage or insulate your launch ahead of potential competitor entry. And as a follow-up to an earlier question, do you have any insight into whether Department of Defense would want to contract for one or two CHIC-B vaccines, or how will that work?

Yeah, well, I mean, that's a good one. I would say, first of all, when it comes to the military, I mean, you will appreciate that this is a different disease than Japanese encephalitis, so it's very difficult to draw a direct comparison. So our goal is to ensure that the military has full access to the Ixchik vaccine. and that they are stocking in preparation for outbreaks. In addition, and as I reported earlier, they are evaluating the data in current outbreaks to determine if it fits in their protocol the way ICSIARO does right now. And therefore, we believe that we could play a very important first mover here. a first mover advantage. So difficult to say at this point in time, but I would say there's a good chance that we could really play a first mover game here with the US military, for sure.

Got it. Understood. And anything else you're doing commercially for XCHIC just to help insulate your launch ahead of competitor entry?

I think nothing on top of what I reported earlier. I think for us, the most important thing is that we get the label extensions done so that we have a product that is licensed for everyone above 12 years of age. We want to make sure that we get the antibody persistence data into the label That at least the ones that we have reported on thus far These are all you know major potential competitive advantages And and that's what we are currently aiming for and this is what we are doing in addition to what I reported earlier on the commercial front and building awareness and Getting it into the channel and working with HTPs and so on and so forth

Got it. Makes sense. And for the XCRO Department of Defense contract in fourth quarter of this year, can you remind me if you're saying what the amount or range of that contract you're expecting?

Peter, I'm not sure what we reported in the past.

Well, and it's ongoing discussion. So right now, Maury, we don't know. I think what, you know, generally speaking, what we saw last year is that the Department of Defense compared to the contract in 2019, they're building less stock. So we would, my best guess right now, it would be at a similar level than what we had last year. But again, it's already discussed. Got it.

Okay. Thanks for taking my questions.

Thank you. We will now take our next question. Please stand by. And the next question comes from the line of Samir Devani from RX Securities. Please go ahead, your line is now open.

Hi, guys. Thanks for taking my question. It's just a quick follow-up on Ixiaro. I was wondering if you could just give us a breakdown of what you're seeing from a travel sales perspective versus military sales perspective in terms of growth rates. Thanks very much.

Yeah.

Yeah, thanks, Samir. Well, you know, we have not disclosed the details between military and travel. As we said, both segments are growing. Travel sales, we have a relatively small growth. So the majority of the year-over-year growth is really coming from US military, where, as I said during the call last year, in the first half year of 2023, we had, you know, very, very low sales. and this year it was it was much more substantial but we have not disclosed the exact data okay thanks very much thank you as there are no further questions i would like to hand back to thomas lingelbach for any closing remarks thanks a lot for um for your questions um as you have seen

first half year especially on the um r d and strategic development front has been quite remarkable and we see really great growth opportunities for vaniva including that we have reiterated that we see a pathway to sustain profitability upon successful licensure and commercialization of the lime vaccine and therefore you know Thanks to all of you. Thanks to our shareholders, employees, partners. And I wish you a very good remainder of the day.