Are we live? Awesome. Hello, everyone. Welcome to the Jefferies Healthcare Conference here in New York. It's a pleasure. Thank you for tuning in everyone in New York and online. I'm here joined by Novavax, Jim, John, Elaine, Doug. Great to see you all. Let's get started with some introductions and let's talk about your new growth strategy early in 2025. What are some proof points that demonstrate how your strategy is working and anything that you think the market and the street is underappreciating about your story? Let's start with that. Thank you, Nabeel. It's great to be here with everyone, and thank you for joining our presentation today. Right now, we couldn't be more excited about where we are in Novavax's history. As you know, we launched our new strategy in January of 2025. Yeah. You asked, Nabeel, about proof points. We're really excited about what's already unfolded in the first trimester of this year, which are the fruits of our labor starting to show, right through 2025. Yeah to generate and to engender more interest in our technology. First proof point really is the level of interest that we have seen as a management team from third-party companies working with us on our technology is unprecedented. In Novavax history since we launched our strategy in January. We were proud to announce the new partnership with Pfizer in January, and we'll talk a little bit more about that today, as well as in the first trimester of this year, four new MTAs, or Material Transfer Agreements. This is where we provide, as Novavax, samples of our Matrix-M to potential partners through a collaboration, and that allows them to experiment in their own labs on targets of interest across infectious disease and oncology. That's a step we took with Pfizer as well. In the hopes that that might turn into a license agreement and a full revenue-generating partnership subsequent to the positive experiments that they may have. In fact, of those four new MTAs, one of them was another top 10 global pharmaceutical company, who also happens to be ranked globally as an oncology leader. Very, very exciting to see the interest not only in infectious disease but also in oncology indications. Those are some of the proof points that we've recently shared. I think what might be misunderstood or missed about our strategy currently, Nabeel, it's an interesting question. Number one is the way that we might generate revenue from this. Yeah. In a typical, traditional biotech approach, a company from the lab all the way through their clinical trials to approval and launch could take many years before they generate the first dollar. With our Novavax strategy now, we can monetize our technology right now immediately upon the consummation of a partnership and a license through upfront payments, as exemplified by the Pfizer $30 million upfront payment. Through potential milestones for the clinical development of assets using our Matrix-M. We announced in the Pfizer deal $70 million in eligible potential milestones for Novavax per field as they would advance something through clinical trials. That allows us to pull forward tens of millions of dollars potentially hundreds of millions of dollars in the form of other sales or approval milestones that might be in a particular agreement, and then royalties for decades to come. I think that may be underappreciated. Yeah. The last piece is amplifying the impact and the value of our technology overall. More than Novavax alone could ever hope to do, we announced in our most recent earnings call the scope and scale of these collaborations and partnerships combined, which represent currently over 50% of the projected global market opportunity in vaccines for oncology and infectious disease, as projected by McKinsey and Evaluate Pharma, is currently under assessment or has the potential to be under assessment via our partners. That's representing 30 unique disease fields across oncology and infectious disease. As Elaine said in our recent earnings call, many of those more competitive disease areas and markets have more than one partner or collaboration going on, which increases our probability of success for more potential future partnerships and revenue streams along the way. That's how I'd answer that. Yeah. Thank you for that big-picture overview. Regarding some of the interest and ongoing activity, I think Matrix-M continues to be a bigger story, and that license agreement that you arrived with Pfizer in January, could you walk us through a little bit about the scope and the terms of that license and what we should anticipate the next steps that Pfizer could do and potential catalysts and milestones that could come out of that? Sure. Elaine, do you want to take that? Thanks, John. Briefly, the Pfizer Matrix-M licensing agreement enables Pfizer to utilize Matrix-M with a field that was disclosed to us, but we are not publicly disclosing it. The second, they have an opportunity for a second field that they will study Matrix-M with, bring it through clinical study, and that has not been disclosed yet. That $30 million upfront is something that we received earlier this year, we have the opportunity to receive sales and development milestones to the tune of $250 million. Just to characterize, we also have royalty payments coming off of that particular license agreement as well. Let's just say if Pfizer is successful with the clinical development for a product, that might be over $1 billion. Cumulatively, we'd be able to receive over $1 billion in royalty payments because of the term of the agreement is for 20 years. Again, as John was mentioning, this gives us a wonderful opportunity then to continue to build revenue from that particular licensing agreement over time. That's been our strategy for Matrix-M holistically. We announced another MTA with another major pharmaceutical company this year as well, as John mentioned. Which gives us the opportunity to repeat that. Right. That particular MTA includes nine fields of study. We're very excited about that as well, because each one of those fields has the potential to be over $1 billion for sure if that particular study is successful. Very excited about that as well. Thank you, Elaine. Regarding the nature of that license agreement, it's sort of a non-exclusive license. Walk us through what led you to follow that approach to partnering with Matrix-M. Go ahead, Elaine. Yeah. The non-exclusivity gives us the opportunity then to partner with major vaccine companies where there may be overlap. I think we mentioned during our earnings call we have overlap, for example, in the pneumococcal space. We also have overlap in RSV, potentially. We also have overlap in infectious disease such as CMV, cytomegalovirus. Again, having a non-exclusive opportunity gives us our opportunity to partner with companies. We are successful, right, because we have multiple shots on goal with our Matrix-M technology. However, that may wind up manifesting itself in the marketplace over time. If we have two or three companies, let's say, that are utilizing Matrix-M in a pneumococcal space. We would hope that one of them will be successful. Mm-hmm. Yeah. Get all the way to commercialization. If we have another and another, of course that's additive as well. Again, we're non-exclusive for a reason. Yeah because it's certainly very beneficial for us. Nabeel, just to build on that for one moment. Putting it into a hypothetical example. If we had, say, three companies that wound up doing a partnership with us through a license, Elaine, right? They were each pursuing one of those fields, the same field A. If they're pursuing that field, if we set those deals up in a similar way to what we've done with Pfizer. We should be eligible for milestones along the way on their clinical development. If you could imagine in that hypothetical example, three companies targeting a field with our Matrix-M, and Novavax would have the ability then to earn up-fronts from all three, the ability to earn milestone payments for their clinical efforts on those disease targets years before a vaccine might get approved and launched into the marketplace. Even if, in that hypothetical example, two of those companies didn't succeed in their clinical efforts but made it most of the way through, we would have earned revenues along the way for their efforts. Yeah. One of those companies makes it through or more, we are then eligible for potentially larger milestones upon approval and sales, and then royalties for potentially decades to come. That's really exciting, and what it does is show you that if you've got 30+ fields under assessment now with multiple partners, four of the top 10 global pharmaceutical companies already engaged with Novavax through collaboration, MTA, and partnership p lus other smaller and mid-size companies that we haven't disclosed yet, that are working with us, you can imagine then that our POS, our probability of success is pretty good and relatively high for the potential for more partnerships and multiple revenue streams over time. Yeah. Thank you for walking us through that setup. Regarding the recent MTA with a large oncology or a large top 10 global pharma company, we're looking now into indications beyond ID, and could you walk us through how Matrix-M might have a mechanistic favorable, what it can offer in the oncology setting, and yeah, more on that story? Go ahead, Bob. Sure, thanks. Matrix-M has a broad array of immunologic properties that make it such an exciting adjuvant in general, certainly in the infectious disease space, and a lot of that we think could have applicability to the oncology space as well. It's been well-characterized to be a Th1-profiled adjuvant. Yeah which means that it induces not only antibodies and neutralizing antibodies, but cell-mediated immunity. It's that cell-mediated immunity which is thought to be so important for oncology, particularly CD8 killer cells that exert the anti-tumor killing activity. Yeah. Matrix-M has the ability to induce cross-presentation of antigens in the cell, that leads to the downstream activity of the CD8 cells that we were just talking about. Those are some of the reasons why we think Matrix has great potential in the oncology space. As we're learning from partners who are also conducting some of these studies, there's a qualitative aspect to the immune effect that Matrix produces as well. It's not just numbers of cells. It's about t he quality of the cells that are activated. Anyway, we're very optimistic, and we really look forward to coming back at future sessions. Yeah Talking more specifically about the data we've generated. Nabeel and Bob, thank you for that clear answer. Part of our strategy, one of the benefits of our strategy, is we get to leverage not only the resources and capital partners and companies we're collaborating with, but also their expertise. We're working with some companies that have deep expertise in oncology and infectious disease. Novavax brings a wealth of experience on the infectious disease side, with two vaccines that are actually approved and on market with our technology now, others that are in phase III, others that are in early stage development right now. On the oncology side, Novavax is not an oncology company, nor do we intend to become an oncology company. We're leveraging the depth of experience, the resources, and the expertise of global leaders in that space with our technology, and we're getting the data that they're generating through these MTA collaborations. which further informs our own internal knowledge on this. We certainly have deep expertise in Bob and his team on immunity and immunological responses that are required to take on these diseases, and we're learning more and more each day. Really exciting part of our strategy is to get to leverage that deep expertise. Yeah The capital of these other companies to accelerate these types of potential advances. Thank you. On those advances, a pleasure to have you with us, Bob. If we could talk a little bit more about the R&D investments with the Matrix adjuvant technology. How do you see these advancements impacting new vaccine development and even further potential partnering? Yeah. Maybe Elaine, you want to take that along with Bob? Yeah. What's really exciting for us is, as John mentioned, we're leveraging external expertise in oncology generating a host of data, like essentially a data bank. We're looking forward to seeing that read out in the next 6 to 12 months. Internally, we're also exploring similar but different types of opportunities with Matrix-M. For example, Matrix with a TLR, how is that going to turn on the immune system to identify tumors? We're looking at different opportunities as it relates to Matrix in terms of its formulation as well. What we learn internally, and we'll map that up against what we learn externally, again, to generate data, which will be powerful then in having future discussions with partners who are also very big players in the oncology space. Yeah, maybe I'll just add that we're also on the antigen side. We're also using our internal R&D engine to explore additional antigens. Yeah that can be utilized with Matrix. Yeah. Some of those will be antigens that we'll use as test cases to help us learn and advance and move the science forward. Others, for example, in the case of our C. diff vaccine, will be ones that we may choose to advance internally and take into the clinic. It's kind of like a two-pronged part of our R&D strategy there. One comment just to add, Elaine had mentioned 6 to 12 months for some anticipated data, but we already have data generated by some smaller innovative partners in oncology that we had partnered with quite a while ago through MTAs as part of our new strategy launch. We have some insights already as to some of the antigen targets and things in oncology. We just announced, to your point, Elaine, this new MTA collaboration with a top 10 global pharma company. We're excited about the experiments they're starting to undergo and anticipate in the coming quarters in learning from that together as well. Thank you. Thank you, team. Then, taking a step to the Sanofi partnership, so you signed that licensing agreement with Sanofi back in 2024. Could you remind us of the full scope of that agreement and sort of the key next steps and catalysts? Go ahead, Elaine. That licensing agreement was for the right to execute the commercialization of Nuvaxovid currently in the market. That's the main focus that Sanofi has at the moment, and the other part of that collaborative license agreement was then also to prosecute a combination influenza and our Nuvaxovid program. Sanofi is studying that both with Fluzone High-Dose as well as their Flublok, and should be moving forward with that in the future. The third part was for the prosecution of Matrix-M in their earlier preclinical work, which they would potentially then move into clinic. Very excited about that deal. We're mostly through most of the receipt of the milestones at this point in time. We've executed that very well in partnership with Sanofi to date. Excited about that. They're obviously getting ready for the season this year, the upcoming season. Maybe Jim, do you want to speak a little bit about that as well? Absolutely. As we look forward to the catalyst that lie ahead of us, it includes certainly the fall performance with Nuvaxovid. It includes Sanofi's articulation of the path forward, both U.S., Europe, and other markets for their CIC programs, and then also further development. When we think about the milestones, for example, that lie ahead of us, outstanding. We have $425 million in milestones, $75 million due upon tech transfer. This is manufacturing tech transfer. There's $350 million in milestones eligible under the CIC programs, including $125 million linked to the initiation of a phase III, and then $225 million we're eligible for upon a U.S. combination product launch. A lot to happen there, both in terms of milestones and then really material opportunity in the marketplace, but also for royalties to us. A reminder on that marketplace. COVID market, it's running about $5 billion-$6 billion, and the flu market, about, again, $5 billion-$6 billion. $12 billion total across the two. When you look at Sanofi and the flu in particular, they have almost half of that market in aggregate. Their net sales of the six, think about $2.5 billion-$3 billion. That sales amount for Sanofi, highly concentrated in the enhanced flu market. Think 50 and older. the higher price premium marketplace. There, Sanofi has almost 2/3 market share. As these markets evolve, COVID plus flu, Sanofi and others see a combination market. COVID plus flu is where this market is going for many reasons. We have the ability to be a part of the evolution of Sanofi's market-leading flu when combined with our Nuvaxovid to really take an ever-bigger share of that combined $12 billion opportunity. Yeah. super excited about that. This fall, which was your question. Yes is the first step towards that. What should you expect? The same way that Sanofi methodically built that market-leading flu market over time, watch for an analogous approach. Now, we're not guiding for them, but we would say, their history would say they invest and they have a methodical approach over time. An example of recent investments in the COMPARE study. Yeah. Really critical study that just read out that showed t he favorable safety profile of Nuvaxovid versus the next gen from Moderna. We are really happy with the investment profile and where they're going with these assets. Thank you for that overview, Jim. We're really excited about seeing the CIC program. If you could just update us on the current status of that program and when might one or both of those Sanofi CIC programs advance to phase III. Yeah. Jim, do you want to start and then have Elaine perhaps build on that? Well, sure. One of the reasons why we're always a little careful here is, hey, we can't speak for Sanofi. Yeah. what I can do, and this is something that. Yeah are more than willing to, is emphasize one of the public statements Sanofi has made. Well, it began back in December, Sanofi's R&D Day, where they walked through the phase I, II data of Nuvaxovid combined with both of their enhanced flu products. This is a co-formulated phase I, II that was the gateway to a pivotal program. What did they see? Excellent results. In fact, they stated- Yeah high probability to show non-inferiority in an immunobridging study. When you think about that, well, that's the type of study you'd run in Europe, for example, right? Think [Fc]. Yeah U.S., that would be the study in Europe, Immuno. The next step was to talk to the agencies. Sanofi went on to say, in the first quarter and leading up to now, they're in active dialogue with the regulatory agencies. U.S., Europe, and outside. Based upon those engagements, they anticipate launching into a pivotal program for one or both. We're awaiting that those next steps. Yeah. Couldn't be happier. The most recent data point, World Vaccine Congress. Yeah. They again presented that data. Yeah. They again presented their conviction. Yeah market's going to combination. Importantly, on top of that, when they look, Sanofi, at their growth drivers and they talk about the big three future growth drivers, not just for vaccines, but for their company, the CIC programs was one of their big three. That's how important they're saying, Sanofi is saying the combination programs are to the future of Sanofi. No, well said, Jim, obviously we can't speak for them. That's their own public commentary that we're sharing with you. They're outstanding partners, outstanding levels of communication between our executives at Novavax and Sanofi, just look at the COMPARE data we talked about or we will talk about today. Again, they leaned into that. That's part of their methodical approach to investing in the space and really helping to drive share and future share for Nuvaxovid. Yeah. One more question there. Just as we think about that 2026, 2027 season, how do you see Sanofi planning to position Nuvaxovid in the marketplace for that upcoming season and beyond? Yeah. Again, we're not going to speak directly to their marketing campaign. Yeah. They hold the license for that. Yeah their hands on the wheel, so to speak, on that Nabeel. Yeah. You can see them leaning in with this COMPARE data, really noting the tolerability of Nuvaxovid versus the other products, and they're bringing their expertise to bear to the market from a contracting perspective. Yeah a marketing perspective. Expect them to be reaching out through many vehicles to the consumer audience and the physician audience, and are really leaning into that tolerability data in particular. We'll see how they unveil that campaign. We've seen the campaign. Yeah. They've walked us through their plans. We're very excited about it, and I think you will be too when you see it launch. Thank you, John. Looking more internally in the R&D investment strategy, we talked a little bit about this. We just highlighted a little bit of the C. diff., I'm curious how we think about advancing the internal vaccine candidates and generating data, how you consider advancing a candidate yourself or going to, in talking about late stage or to the market. We can start with C. diff. after that. Go ahead, Elaine. Yeah. Just from a strategic perspective, for us, we look at the fact that there's a significant unmet medical need within this infectious disease, of course. Companies have stepped up to the plate to study this and have failed. We learned from that. We iterated on this for many months, both from an assessment perspective as well as a scientific perspective. We're delighted to be advancing our C. diff. candidate, and our goal is to do that within the next several months. Bob will speak a little bit more specifically about it. Again, the crosshairs for us was the decision around significant unmet need, large market, both in the U.S. and globally. We're very excited about that opportunity. It's over $1 billion. Yeah. Potentially between $1.5 billion and $3 billion. Yeah. That was also a key focus and a key inflection point for us as well. Maybe, Bob, you want to speak a little bit more about the opportunity? Yeah. Maybe I'll talk a little bit about why we think our particular candidate is differentiated from what else is out there right now. Like Elaine said, it's a huge medical problem. No currently available, no currently licensed vaccine. What we've seen is others in the past have developed toxin-based vaccines that have failed in the clinic thus far. What we're doing is we've developed a vaccine construct that goes beyond toxin only. We have toxin antigens, but we also have non-toxin antigens. We've also created our antigen structure such that we're targeting more than 90% of the C. diff. strains that are currently circulating globally. We're coupling it with Matrix-M. We get all the benefits that have been associated with Matrix-M, some of which we've talked about already. In addition, the potential to induce mucosal immunity. Mucosal immunity is important. or for treating an organism like C. diff because it's a mucosal infection in the gut. Yeah. Those are the key differentiating factors. We're looking forward, we're in IND-enabling toxicology studies now, and hope to be able to bring this candidate into the clinic as early as 2027. Thank you for that overview, Bob. Yeah, see the unmet need there. Go ahead. Nabeel, in line with our strategy, we're being very selective on what to bring forward and put into the clinic and into human trials. C. diff., there's no vaccine available today currently. We know that Pfizer is working on a phase III C. diff candidate. We wish them success and would like to see them succeed and help to build that market and provide patients with an alternative approach to protecting themselves from this significant disease. In fact, my sister-in-law's best friend died of a C. diff infection after a routine abdominal surgery just last year before Thanksgiving, leaving her family without her to enjoy that holiday. We've seen it impact people very close to our own family. It's thousands of people a year are dying in the U.S. and Europe of this, from routine surgeries and in nursing homes and other things. We wish Pfizer success, and then we're very excited that Novavax could be one of only two- Yeah One of one should we succeed with that in bringing a vaccine forward that we do feel, per Bob's comments, is very differentiated, and we're very excited about what we've seen early on. We think there's significant value inflection. Yeah human data on that to show that it works in people, not just. Yeah animal models, and that translational medicine can work here and show us some good results. We'll keep you posted, and very excited to be in the clinic as early as 2027. No pressure on Bob. Yeah, no, that would be very meaningful for patients. Moving to the non-GAAP expense. You've improved the 2028 non-GAAP expense target to $150 million-$200 million. That's about a 50% reduction compared to 2025. Could you go over some of the primary drivers of that change to your cost structure and how you are basically investing to create value at this scale? Go ahead, Jim. Hey, certainly. For folks who are familiar with our journey, while the 50% reduction to our non-GAAP R&D and SG&A may sound pretty impressive, from 2025 to 2028, when you go back as recently as 2022, we're talking about a reduction of almost 90%. What it genuinely captures is the reconfiguration of this company and the focus of this company around this technology and unlocking significant value through our growth strategy. A growth strategy that's predicated on generating data to drive partnering. It's also generating new data to further enhance our Matrix offerings and differentiated candidates. While at the same time, we're also supporting being a Matrix manufacturer. That's a part of what we do as well. Our investments, as we move forward, our core investments that are ongoing are focused on those exact points, and that's what Bob described earlier. It's we've got an amazing Matrix-M vaccine. We can probably do some more and unlock some value incremental to that. So we're really excited about making those investments. Bob, I loved your points around oncology and the differentiation of what we think Matrix can do there. You heard Elaine and Bob talk about C. diff, a case study in how you can apply our unique technology in a differentiated way, a way that others cannot do. Because through our partnerships, you're hearing our partners are advancing programs in many areas, and we'd love to let them, because it amplifies investments, but not on our spend. We're really looking at differentiated investments, and that's our focus. Between 2026 and 2028, as our cost structure is decreasing, here's what you're seeing. We do have some legacy obligations to either APA partners and Sanofi, for example, on co-sharing some of our post-marketing commitments, as an example, related to Nuvaxovid. As those roll off and our support for commercial manufacturing rolls off in the next 12 to 18 months, you're going to see those associated costs come out of our cost structure. However, underneath that is a core spend profile, currently about $200 million a year, but reaching the $150 million to $200 million by 2028. That should give you a good sense of the evolution and where we're focusing our investment to create value. Really, Jim, another way to look at it through a non-GAAP lens is from a $1.7 billion annual SG&A and R&D spend, we've driven this down to $200 million, and we're now at that last $50 million of toggle. Anything above and beyond that this year and a tail going into next year are those trailing obligations to close out APAs and other partner support that's non-reimbursed. That enables us to keep the core capabilities needed to execute on this strategy. We're keeping R&D core capabilities to generate data, support these partners, and make some of these partnerships possible, frankly. Key to execution is keeping those core capabilities in a lean infrastructure. That's it. Excellent. Thank you. One more question. You've guided to non-GAAP profitability as early as 2028. Could you just give us an overview of what potential milestones, any things that we can expect, and how you plan on reaching that goal? Yeah. Go ahead, Jim. Nabeel, thank you for making that point in this question, because this is a spot of high interest with investors and others, namely that, one, we have enough cash on hand to go and fund our company all the way into 2028 without any incremental funding coming into the company absent the reimbursements. Really important, we've set up a cash runway. Yeah. Coinciding with that 2028, you're hearing our non-GAAP cost structure. Yeah. We're also seeking to reach that by 2028. Three, we also have the ability to reach non-GAAP profitability, namely. Yeah through the diversified revenue stream across partners, through royalties, milestones, up-fronts, we see the potential as early as 2028 to be non-GAAP profitable. What does that look like tangibly? Well, at midpoint, $175 million R&D and SG&A. Picture you've got $25 million, $30 million in stock-based comp, for example, then your breakeven's about $150. That's what it looks like. Yeah. We're not focused on breakeven. We're focused on driving cash flow orders of magnitude higher than our cost structure over time. We believe that this partnering model and our existing partners we have today, and the ability to supplement it, has the ability to create, as I said, orders of magnitude more cash than our cost structure, and that is a critical value creation moment. We, of course, will always evaluate our ability to continue to invest in our technology, and we'll evaluate what to do with that cash over time. Will we just invest in the company, or might we contemplate returning efficiently cash to shareholders? All of that is on the table and being evaluated, all towards value creation. Thank you. Well said, Jim. Thank you. Nabeel, I think we're just about at time. If I could have just a closing comment here to say another benefit of our strategy is the ability to amplify our tech. beyond the potential revenues, orders of magnitude of revenue coming in above and beyond our cost structure is our intention. It's really the impact on global public health and human health. that actually matters a lot to our team. Bob, we've talked about that time and time again in the hallways of Novavax, right? Our scientists, our employees, they actually really believe in what we're doing. They believe in our technology, and they choose to be with us at Novavax. Like Jim said, we basically reduced our costs and our headcount 80% to 90% +, and on our way to even more now. Our retention level of talent is well within or even above industry benchmarks when you look at it. There's a passion here, and we want to leave a legacy. Not only to drive capital and reward our investors who've been patient with us as we migrate the company into a new strategy, completely rebuild it from the ground up, and change our mission and our vision, and we're in the middle of that execution right now. the chance to leave a legacy, to impact billions of lives with potentially dozens of vaccines and immunotherapeutics taking on cancer, bacterial and viral infectious disease, something that we're all really proud of being part of and excited about the future. Thanks for your time today. Thank you. Thank you. Thank you.