The operator introduces the Moderna First Quarter 2024 Conference Call and hands it over to the speaker, Lavina Talukdar. Stéphane Bancel, the CEO, discusses the company's first quarter financial results and business updates. He mentions the Safe Harbor provisions and the risk factors that could affect the company's performance. Jamey Mock, the CFO, presents the financial results and Stephen Hoge, the President, talks about the late-stage clinical programs. Stéphane Bancel concludes by discussing the potential impact of their COVID vaccine and the company's pipeline on a large number of people.

In the first quarter, the company made significant progress in their vaccine development for EBV, VZV, and norovirus, as well as expanding studies for individualized neoantigen therapy. They also announced four important business agreements, including a licensing agreement with a leading pharmaceutical company in Japan, a contract to provide COVID-19 vaccine to the Brazilian government, a project financing program for their flu program, and a collaboration with OpenAI to use AI in their business. They also terminated their gene editing collaboration with Metagenomi.

In the third paragraph, it is stated that all rights granted under the collaboration will be returned to Metagenomi, which is a good sign of Moderna's commitment to driving returns. The company's Q1 financial results were ahead of plans, with a net loss of $1.2 billion and $12.2 billion in cash and investments. The company has focused on financial discipline and has reduced operating expenses by almost $800 million compared to the previous year. The commercial performance in Q1 was mainly driven by sales in the U.S. and Latin American markets, with a decline in sales outside the U.S. due to the anticipated transition of the COVID-19 vaccine market towards a seasonal pattern. Sales are expected to be around $100 million in Q2, for a total of approximately $300 million in the first half of 2024.

In the first quarter of 2024, the company's cost of sales was $96 million, representing 58% of net product sales. This was primarily due to a decrease in sales and is expected to decrease to 35% for the full year. R&D expenses decreased by 6% due to the absence of upfront collaboration payments, and SG&A expenses decreased by 10% due to cost discipline and strategic investments. The company reported an income tax expense of $10 million and a net loss of $1.2 billion, compared to net income of $79 million in the same period last year. Diluted loss per share was $3.07.

Moderna has seen a decrease in cash and investments due to expenses and operations, but has invested in building an efficient operating model. This includes scaling capabilities and investing in digital technologies such as a new ERP system and artificial intelligence. These efforts have allowed the company to streamline processes and improve decision-making, leading to increased operational efficiency.

The company has implemented a purchase-to-pay GPT in their G&A department, which has improved productivity and reduced the need for external consultants. They have also invested in AI technology and training programs to further enhance efficiency. The company expects to see a low point in sales in 2024 but anticipates growth in 2025. They also expect a decrease in R&D and SG&A expenses, and minimal taxes and capital expenditures in 2024.

The company expects to end 2024 with $9 billion in cash after a low point in Q3 due to seasonal collections. They also announced a project financing deal with Blackstone, which will provide up to $750 million in funding for their flu program and earn milestone payments and royalties. The deal will help accelerate their pipeline. Stephen Hoge then reviews updates from their clinical programs and therapeutics portfolio, including updates on their RSV vaccine candidate undergoing regulatory review and expected launch in the US after the June ACIP Meeting and Recommendations.

At Vaccines Day, the company shared updates on their various vaccine and therapeutic programs, including progress in their RSV, flu, COVID, latent and other vaccines, and oncology therapeutics. They have presented positive data from their Phase 3 studies and are engaging with regulators for potential approval. They have also made significant progress in their CMV, EBV, varicella zoster virus, herpes simplex, and norovirus vaccine candidates, with some programs moving towards pivotal Phase 3 trials. In oncology therapeutics, their Phase 3 studies are enrolling well.

The company announced three new trials for INT, presented Phase 1 data for advanced unresectable HPV negative head and neck cancer and Phase 1 translational data for mRNA-2752 at AACR, and will be hosting a Moderna oncology event at ASCO. They also discussed their COVID-19 strategy for 2024, which includes increasing vaccination rates in the U.S., participating in the 2024 tender process in Europe, and prioritizing markets for commercial focus in the rest of the world. The U.S. currently has lower COVID vaccination rates compared to flu vaccination rates, but a higher burden of disease. U.S. hospitalizations for COVID are significantly higher than those for flu or RSV infection.

The paragraph discusses the importance of COVID vaccines in reducing hospitalizations and long-term effects of the virus. It also mentions the selection of a strain for the 2024-2025 formula and preparations for potential backups. The company is working to align the timing of flu and COVID vaccine approvals and is encouraged by an earlier VRBPAC meeting for this year's COVID front selection. The launch of a second respiratory vaccine for RSV is also anticipated.

The older adult RSV market is expected to grow significantly in the coming years, with marketing applications filed globally and anticipated approval in the first half of 2024. The company's RSV vaccine has shown strong efficacy and safety data and is the only product available in a pre-filter range of PFS presentation, which has been shown to be more efficient than other vaccines that require multiple steps for preparation. The company is also excited about upcoming pipeline milestones, including the approval of RSV in the ACIP and data for the vaccine in the 18 and above age group.

Moderna is making progress with its various vaccine programs, including flu, COVID, CMV, and INT. They are engaging with regulators and looking forward to potential Phase 3 data in 2024. They are also planning to discuss the possibility of accelerated approval for their INT program based on Phase 2 data. They are dedicated to achieving their goals and have upcoming presentations on their oncology program and R&D day. The operator then opens the floor for questions from analysts. The first question is from Salveen Richter with Goldman Sachs.

The speaker discusses the company's strategy for pursuing contracts for the RSV vaccine, which cannot be done until it is approved by the regulator. However, the medical team is actively engaging with retail pharmacies and hospital networks to highlight the product's efficacy, safety, and benefits of PFS. On the topic of the three new indications for the INT program, the speaker explains that they are all in adjuvant settings where there is a known benefit with KEYTRUDA but an opportunity to improve with INT. The company has been aggressively pursuing these adjuvant indications since seeing positive Phase 2 results in melanoma.

The speaker is asked about the company's expectations for RSV and INT in the coming year. They clarify that they have not provided specific guidance for RSV, but have broken down their overall sales into different categories. They also discuss the importance of enrollment progress for INT's confirmatory study and mention that they have not yet consulted with the agency on this matter.

The company is making progress with their RSV vaccine and are optimistic about its availability soon. They will engage with the FDA on the possibility of accelerated approval. They expect a parity recommendation from ACIP for their RSV vaccine and are actively engaged with regulators on the submission process for their flu vaccine.

The company is expecting to receive clinical data on their combination flu COVID vaccine soon. They are also discussing with regulators about the potential benefits of boosting for their CMV vaccine. They do not have any evidence that boosting will be necessary, but they will continue to monitor the durability of their vaccine's protection. The company expects a three dose series to be effective for a long period of time, but this is subject to the efficacy data from ongoing Phase 3 studies.

The company is making progress in a study on recurring cases and expects to provide an update on the interim efficacy analysis this year. The timing of the analysis may also allow for a final analysis to be conducted. However, the company cannot commit to updating until they see the data and understand the timing of the final analysis. They are also developing a refrigerator stable vaccine for the flu, but it is unclear when it will be approved and if the combo vaccines will also be refrigerator stable.

The speaker thanks the questioner for their question about the company's respiratory protocol portfolio, which includes RSV, flu, COVID, and the flu COVID combo. They clarify that all of these programs are being developed towards refrigerator stable prefilled syringes, which they believe is the ideal presentation for healthcare providers worldwide. The speaker also mentions that they are actively participating in a tender for up to 36 million doses of their COVID vaccine in the EU, but the final number will depend on the number of countries that apply. They decline to share specific pricing information for competitive reasons. The speaker then passes the question to another speaker to address the question about INT.

The speaker discusses the progress and contingencies for the completion of the second and third criteria for their product, which involves manufacturing readiness and regulatory approval. They mention that they are working with their partner Merck and will defer to regulators on the decision to make the product available to help those suffering from cancer. The next question is about the PDUFA date for RSV, which is still May 12th. They also comment on a recent decision by Judge Goldberg regarding IP and its potential impact on sales of COVID. Lastly, there is a question about INT.

The speaker, Stephen Hoge, responds to questions about the company's progress on a randomized trial for cancer and the upcoming PDUFA date for their RSV treatment. He also mentions that they are still evaluating the data for their head and neck indication with partner Merck. The CEO, Stéphane Bancel, addresses questions about intellectual property related to their COVID-19 vaccine technology and expresses confidence in their position. Finally, a question is asked by Jessica Fye from J.P. Morgan.

The speaker cannot comment on when the manufacturing scale-up for INT will be completed, but they have sized the plant according to the size of the melanoma market and the strong data from the Phase 2 trials. The plant is also being built to accommodate other studies. The speaker also mentions that the plant was purchased last year and is already a finished building, which will save time to market.

The team has been working to get the plant ready for manufacturing, and they plan to launch with the first module of capacity. They will be able to scale quickly as they get more indications available. The company plans to submit both the flu and flu COVID combo programs for regulatory approval, with the data for the flu COVID combo program expected in the coming quarter. They will determine the sequencing of submissions based on regulatory strategy and data preparation. The company is aiming to submit both products across all major markets this year.

The speaker acknowledges the confusion surrounding the model and the question of CMV and seropositivity. Although the risk of vertical transmission of CMV is highest in seronegative individuals, it can also occur in seropositive individuals. The vaccine is currently being evaluated in seronegatives, but has also been studied for safety in seropositives. The speaker is optimistic about the potential benefits of the vaccine for both seronegative and seropositive populations, and the goal is to have a label for those 16 years and older.

The unidentified analyst asks about updates on the pivotal strategy for the zoster vaccine candidate and the current thinking on the Phase 3 design. They also inquire about the nature of editorial and comments on safety for the PA and MMA programs advancing into pivotal trials. Stephen Hoge responds that they are still finalizing the pivotal strategy for the VZV program and have seen strong T cell response in immunogenicity. He also mentions that the clinical data for the PA and MMA programs show a compelling benefit risk profile and good safety profile, with many patients being on the drug for over a year. He does not have a view on editorials or opinions based on preclinical data.

The company is encouraged by the clinical data for their 1083 program and has no new concerns. The enrollment for the study was completed a few months ago and the top line update will be comprehensive. The company plans to file for regulatory approval as soon as possible if the data is positive. For their RSV program, they are still in the early stages of establishing reimbursement internationally.

The speaker mentions that there are differences in the structures of the P303 and 1083 studies, so it is not advisable to draw too many correlations between the timing of their submissions. They also discuss the importance of international markets and the potential for RSV approval in various countries. In response to a question about CMV interim data, they clarify that it could be released by the end of the quarter. The speaker also talks about the potential for the HSV vaccine to have implications for Alzheimer's disease.

The speaker clarifies that there is no change to the expected timeline for the CMV readout and discusses the potential for HSV to improve outcomes for seropositive individuals. They also mention the possibility of using the vaccine for prevention of infection, but caution that it is still early to draw connections to Alzheimer's disease. They mention the success of the EBV vaccine in multiple sclerosis and express excitement about the potential for intervention. The speaker concludes by saying that most of the questions have already been answered.

The speaker asks about the R&D costs and profit sharing for the cancer program, as well as the number of indications they plan to pursue. The company is not yet prepared to disclose the R&D costs, but they plan to continue expanding the program through a partnership with Merck. The speaker looks forward to seeing everyone at the upcoming ASCO conference. The call concludes with closing remarks from the company's CEO.

This summary was generated with AI and may contain some inaccuracies.