We are European-based, double-listed on Euronext and Nasdaq, and we have a commercial portfolio in travel vaccination and a variety of interesting assets in our R&D pipeline, most importantly with Pfizer together, the world's most advanced Lyme vaccine program. Certainly an area of very significant unmet medical need with a pivotal readout expected at the very end of this year.
Got it. Yeah, that's a good overview to the company. Let's start off with the pivotal study with your Lyme vaccine, VLA15, with Pfizer. You're guiding to top-line data by the end of this year. How are you setting expectations for the data from Valneva's perspective?
Of course, many people ask the question, you know, what is going to be a good efficacy result? What is not going to be a good efficacy result? We are not speculating about a certain efficacy number. You know, previous Lyme vaccines that were based on a similar mode of action back in the 1990s, they showed sufficient efficacy after initial priming and after booster. Our expectation is that we are at least non-inferior, ideally superior to what was shown. I'm absolutely convinced that a safe and efficacious vaccine will address not only a huge unmet medical need, but also a very, very significant market opportunity.
Got it. Okay. Yeah, that's helpful. We'll probably dig into some more details there as we go. Wondering if you can provide any more granularity on what the timeline for the update could be. Would it be November, December? Any more specifics on what the gating factors are as well?
We are right now in Lyme season number three on this phase III study called VALOR. Right now in this season, the cohort two is being boostered, and trial execution is progressing according to plan. You know, the tick season lasts until September, October, more October these days than September. The endpoints, the efficacy endpoints, mean that we are trying to prevent the disease. It is all about case counts. It is all about case confirmation. Case confirmations include not only medical assessments or clinical assessments, but also a quite significant number of immunological tests. Those are driving the timelines. That is why our current expectation is that for the efficacy numbers we expect, or for the top-line data, how it is being called these days, we expect it to be really at the very end of this year.
We have a whole bunch of additional data points as per clinical trial protocol, which will all come in the first quarter next year. This timeline is unchanged since we guided it first. The submission, as Pfizer alluded to at different locations, is expected for next year. The program is fast-tracked, and we are expecting approval the year after, and then hopefully can start rolling it out to people who can benefit most from it.
Got it. All helpful. It sounds like November is probably cutting it too close. Maybe more likely December is when you'd have the updates there. For the second cohort, wondering if you can comment when you think that the booster for that cohort will complete.
I'm expecting it to be complete very soon, but this trial is being conducted and controlled by Pfizer. I don't want to speak on their behalf, but I'm expecting it to be very soon as per the vaccinations that we have reported on previously.
Got it. Okay. For anything more specific on the BLA filing in 2026, I do not know if there is more specifics on timing for that.
No, of course, our joint objective is as soon as possible. The idea is really to accelerate submission as much as we can, working towards ideally a timeline of ACIP in 2027. In order to get hopefully a very good recommendation ahead of the 2028 tick season. That is the objective.
Got it. Okay. For specific data that could be reported in the top-line update at the end of this year versus what you have in first quarter 2026, can you provide more specifics on that?
Ideally, of course, we are talking about this study has one primary endpoint, and the primary endpoint is efficacy after the first booster. After the so-called three plus one regime, so three doses priming plus the one booster or the first booster, this efficacy number is the only primary endpoint. That is for us the main objective to be reported.
Got it. First quarter 2026, that's going to be just more of the underlying details.
Yeah, we have a, I mean, everyone can read that we have a very significant number of additional endpoints, secondary endpoints, exploratory endpoints. All of that needs to be put together and needs to be reported.
Got it. Okay. Can you comment on timelines for completion of the pediatric phase III for safety in the 5 to 17-year-olds? Is that a gating factor for filing the Lyme BLA?
Not at this point in time. The additional safety study will be reported or is expected to be reported well ahead of that and to complement the safety database, as you rightly commented. Therefore, we do not expect this to be any gating factor at this point.
Got it. Okay. Any more specifics you want to highlight just on the pivotal study's design, the inclusion/exclusion criteria, and how definitions for Lyme compare versus some of the prior studies you mentioned?
Yeah, that's an interesting one, Marie. I think we have, as I mentioned already, it's all about prevention of the disease. This means we are calculating the number of confirmed Lyme cases in the placebo group versus the vaccine group, and essentially in the vaccine group itself. For that, we have a very clearly articulated and regulatory-wise agreed set of criteria for what is a Lyme case and what is a confirmed Lyme case. It's a combination of clinical assessment with certain immunological tests. There are a certain number of tests which need to come out in a certain way in order to account for that. We are also evaluating, and this was a question that we received earlier today, the so-called asymptomatic cases, but they don't count into the vaccine efficacy.
Interesting. How do you do, how are you evaluating that?
By a combination of immunological tests. That's basically how we control it.
Got it. Okay. Based on your phase II data, how confident are you that VLA15 can maintain OspA antibody titers above the 131 threshold throughout the tick season from May to October?
We are very confident that this Lyme vaccine is going to work based on prior data. As you rightly pointed out, only the efficacy definition and evaluation can really show it. I think the immunological profile that we have been seeing and observing across all the different immuno studies is pointing in the right direction. We have tried, and you are referencing the 131, which comes out of a publication of the joint publication where we have tried to kind of compare where the old immunological threshold that correlated with efficacy was at the time when LYMErix was licensed. These are analogues that we have tried. They are to build, they are indicative, they are not definitive. We have tried to de-risk as much as we could in different species, in mice, in monkeys, and everything points in the right direction.
It is all about, I know that this is not what investors like, but we have to wait for the data. If the data will be good, we will hopefully bring a vaccine that is, from my point of view, desperately needed to people.
Got it. Makes sense. I wanted to ask about just there's always debate on different assays used for different studies. For the ELISA assay that you use in your phase II for OspA titers, how does that compare to LYMErix and ImuLyme pivotals?
This is a question on which we could spend many, many hours. I mean, it is definitely the assays are not comparable. I mean, ELISAs used in the 1990s and ELISAs used today, this is like compare the cars that you have seen in the 1990s and the cars that you see today. There has been a real evolution and a substantial innovation. What is in common is that both ELISA systems used as coating agents, the full-length OspA. Of course, our vaccine is only including, since it is a recombinant subunit-based vaccine, it only includes the C-terminal part. We measure, of course, different against the full-length OspA. These are the main differences.
Got it. Okay. Are you saying anything more about just the minimum threshold for detecting OspA?
We have a minimum threshold is currently, I think, around 20, but I need to check that. I do not want to say something wrong.
That would be a positive if it's greater than 20.
Yes, there is a minimum threshold,
yeah,
for insensitivity indicators. I would check the number.
Okay. Okay. And with the asymptomatic patients, so just to clarify on that, if they end up testing positive, but there are no symptoms, then they get classified as negative?
No, they will be classified, they will be calculated. If they are asymptomatic, but show all the immunological parameters, they will count as this is a Lyme case, but it will not be incorporated and calculated for the total vaccine efficacy.
Got it.
It will be part of a separate analysis and will be reported as part of the separate endpoints.
Okay. Okay. Helpful. Let's see. For filing in the commercial opportunity, just in the context of changes at S4V2 and ACIP, just how does that factor into just some of your decisions around filing a commercial?
I think it's, of course, it's very difficult to predict how ACIP is going to evolve, how the whole regulatory environment is going to evolve. The way we look at it is we believe that science and data will prevail and health economical benefit will prevail. When you look at, take Lyme as an example, when you look at the CDC reported costs of treating Lyme here in the United States every year, you don't need to be surprised to see that a health economical benefit of a prophylactic solution would be huge. Therefore, I believe that if the vaccine efficacy and safety supported it, there is no reason not to believe that such a vaccine would get a broad and good recommendation. This is equally true, I think, for all vaccines and for the vaccine space as a whole.
Yeah. Yeah, it makes sense. Can you potentially file for approval for Lyme in adults and children separately with stratified data, or would the submission most likely include pooled data?
We are currently assuming that the submission will include five plus as per the efficacy study.
Got it. Okay.
Later we are expecting an additional study in smaller pits.
Got it. Okay. You and Pfizer have commented on the market opportunity size here with potentially greater than a billion in revenue per year for the opportunity and potentially 80 million people in the United States and 200 million people in Europe living in these endemic regions. Can you talk about just the epidemiology work Pfizer has done in the EU where Lyme cases are likely underreported versus the United States?
Yeah. I think Pfizer have conducted and published multiple AP studies around Lyme disease in different countries, primarily also in Europe. It is clearly, and everyone can pick this up and read it. It is very interesting reading because no one has ever really worked on those numbers before. It is clear that there are many countries in Europe where incidence rates are as high as here, East Coast U.S., or even higher. Therefore, there is definitely a very significant need and opportunity in some of the European countries too. That is what we are currently assuming. This is certainly something that Pfizer are going to build in their commercial and market access models.
Got it. Makes sense. Maybe wondering if you and Pfizer are working with countries to standardize surveillance systems and just increase awareness, and if you could talk more about that.
I think Pfizer's medical team is working very closely with many different countries across the globe. It is a work that is solely being done by Pfizer. Valneva is not involved in that work. I'm sure that as we are getting closer to potential licensure, they're going to accelerate that work.
Got it. Are there ideas that you can put out there on how a surveillance could work for Lyme, how that could be improved?
Certainly, I think it's a bit premature. I would say here in the United States, CDC have developed at least a good surveillance system that covers, they still admit a substantial level of underreporting, but at least there is a precedence. There is another precedence, Germany, the state of Bavaria, for example, a very mature system, Switzerland, very mature system for surveillance. I think there are certain role models out there. I sincerely hope that this will be rolled out to other countries soon because, I mean, we're talking about a tick-transmitted disease. Due to global warming and other factors, I mean, all those tick-transmitted diseases are at a rise. The problem can only go in one direction, namely getting bigger. Sorry. Yeah.
Yeah. Yeah, makes sense. Okay. Let's shift gears, talk about IXCHIQ, where you're still pretty early in the commercial launch there. Maybe just comment on how you're viewing commercial expectations for the rest of this year for IXCHIQ.
Yeah. I think we have seen with IXCHIQ recently some setbacks with regards to serious adverse events that were observed as part of a vaccine, mainly as part of a vaccination campaign on La Réunion, where a very significant CHIK outbreak occurred. This has resulted in the authorities temporarily pausing vaccination in Aldi with IXCHIQ. I mean, we are working with the authorities in a very proactive way to resolve that and to ensure that we include respective precautionary measures for frail elderly, especially those with significant and severe comorbidities, to which extent this has an impact on CHIK market as a whole. I would say IXCHIQ opportunities in particular, we have to see, it's too early to tell. I think we have reiterated our total product sales guidance for this year. At this moment in time, we do not see a reason to change that.
As I said, we first of all have to see all those implications and how the label of IXCHIQ will be updated following the observations and investigations around IXCHIQ safety.
Got it. Do you think the label could be updated then, or?
Our expectation is that certainly a more precise precaution and warning section is definitely advised. This is our very clear company position based on having seen data in about 40,000 people vaccinated to date with IXCHIQ, almost more than half of them in India. This is definitely warranted.
Got it. Okay. Any more specifics on timelines for how that could look?
We believe that in the next two months, this should all be aligned and sorted out, which is also important for healthcare professionals to really get clarity and to understand that there is nothing wrong with the product. This, of course, requires, this is also required to provide further confidence in vaccinating against a quite difficult disease.
Yeah. Yeah, makes sense. For just kind of the longer-term commercial potential here, what's the latest that you're hearing for CDC's MMWR publication? Once that's published, how do you think that could impact sales for later this year and next year?
That's a good question. Basically, we have speculated so many times about when MMWR will come and what it will do that I'm better not doing this anymore because we have absolutely no visibility about this timeline at this point in time. Our primary focus today is to address the concerns that have been there in frail elderly. This is our priority right now. All the rest comes second.
Okay. Makes sense. I do want to ask just about potential contracts. I think common question I usually give you is just on for U.S. DoD and some sort of a military contract. I don't know if there's any perspective on that you could share. It's going to be a younger population, I'm guessing, that would be getting vaccinated, so probably less concerned about.
Yeah. I think there are ongoing discussions, of course. We see an opportunity for IXCHIQ in the military segment as well, but it's too early to talk about it at this point in time.
Okay. Makes sense. And then for IXCHIQ sales in the second quarter versus the EUR 3 million you reported in the first quarter, I guess any more specifics on how would you think about that based on the French government's purchase of 40,000 doses?
Yeah. The vast majority of those 40,000 doses will be accounted for in the second quarter.
Okay. Fair enough. Let's see. Want to shift gears and talk about IXIARO and Dukoral. Maybe starting with the IXIARO, you finalized a new supply agreement or supply contract with the DoD for EUR 32.8 million with potential for the DoD to get additional doses. Are there any specifics you're saying about just timing for revenue recognition and when you could have clear perspective and if they could order more doses?
I mean, as you know, we have a contract that spans, it's a one-year contract that spans over the fiscal year period of the military, which is not the same fiscal year period that we do have. We are aligning with the military constantly on the supply facing. It has also to do with their storage capacities. Therefore, supply patterns vary from year- to- year, whereas consumption within the military is pretty stable. We expect to see a very similar situation than the one that we have seen in prior years.
Got it. Okay. Maybe a couple of questions on the pipeline with your programs for Shigella and Zika. I guess what's the latest progress update there for both of you?
Yeah. As we discussed previously, Shigella is a very interesting program. It is the most advanced tetravalent vaccine addressing shigellosis. There is a very substantial need for a Shigella vaccine, especially in children living in low and medium-income countries where the disease has a very high mortality rate. There is, of course, also a benefit for travelers, probably more in a population that has not the strongest health condition or underlying health conditions. We are working with LimmaTech on this program, which is right now in a phase II. The interesting thing about enteric diseases is that you can do so-called controlled human infection models, so challenge models that provide you with a hint on efficacy early on. It is a highly de-risked development program. We are right now in two phase II studies.
We have extended for the adults the immunogenicity phase, which is the phase to optimize dose and schedule before you challenge. We are in parallel running a study in Kenya in children. We expect key readouts for all of that still this year. Subject to data, we will decide to proceed and expect to go into a second challenge with a second strain because it is a quadrivalent vaccine. It is supposed to address the most prevalent strains of shigellosis. Therefore, that is an interesting program and could be the next phase III program post-Lyme, strategically. On pipeline, as you know, we are still working on Zika. One of the very few companies with an active clinical stage program on Zika. We expect data still this year.
We will then follow up and look at antibody persistence, which has been a bit of a challenge for prior Zika vaccine candidates. Subject to data, we will decide on the next steps.
Got it. Makes sense. For Shigella, maybe just talk a little bit more about the strategy there. It's kind of an interesting situation because you're not investing a whole lot upfront into this development. Maybe just talk about the setup there.
Yeah. So basically, what we are doing right now is, as I said, it's a collaboration with LimmaTech. We paid LimmaTech upfront. LimmaTech are reinvesting this money into the trial execution. Only after the current two studies, Valneva will take over and will basically invest into the next stages. This is why we like this program, not only from a medical need and from a public health perspective. This is also why we like it so much from a financial management perspective because it's really you invest in a staggered way. Every time you invest, your POS of the program has gone up. That's exactly what we are currently looking for.
Got it. For making that decision for the next, for the second, so it's going to be based off of the second challenge then?
I would say now we have two decision points. One is the data from the first challenge. The second is the immunogenicity data and safety data in children. We will decide which way to go first. Do we go the children at MRC route first, or do we go the adult travelers route first? This will all be determined by data, Murray. We are very much looking forward to that.
That could be by the end of this year?
End of this year, early next year.
To make the decision.
You see already that Valneva is approaching a quite interesting period with multiple decision points coming up.
Agreed. I think maybe in closing out, since we're out of time, maybe just remind where you're at with cash runway and highlight, recap the key catalysts ahead investors should be showing.
Yeah. I think we reported a very strong cash balance at the end of the first quarter. We have recently, based on reverse inquiries done to ATMs, this is all public, we have basically strengthened, therefore, our balance sheet even further. We have previously said that our cash is sufficient until we expect milestone payments from Pfizer on the back of the successful Lyme program. We have further guided the market that we want to reduce our operating cash burn significantly this year. We have even given a number, EUR 30 million. Therefore, of course, we are constantly focusing on cash, carefully spending wherever we can.
Got it. Thanks so much for joining us today, Thomas.
Thank you, Murray.