Valneva SE Q4 FY2024 earnings call

Management Statement and Operational Highlights

• 2024 Highlights: Valneva achieved double-digit year-on-year sales growth above €160 million, had a solid cash position near €170 million with lower operating cash burn, and saw successful placement of ~€60 million and sale of a priority review voucher.
• Regulatory Execution: Three additional IXCHIQ approvals and upcoming label extensions, with strong regulatory progress.
• Pipeline: Augmented pipeline with a leading Phase 2 Shigella program. The Lyme vaccine candidate VLA15 is in Phase 3, expected to have first data readout by the end of 2025.
• IXCHIQ Details: A highly differentiated chikungunya vaccine with strong and persistent immune response, ongoing R&D activities including Phase 4 studies, label extensions, and pediatric studies.
• Shigella: World’s most clinically advanced tetravalent Shigella vaccine candidate S4V2, with Phase 2 studies ongoing.
• Zika: Novel adjuvanted inactivated whole-virus vaccine candidate VLA1601, with Phase 1 results expected by the end of 2025.

Segment Performance

• IXIARO: In 2024, sales reached €94.1 million, a 28% year-over-year growth from €73.5 million in 2023. The gross margin was 61% in 2024 compared to 52.3% in 2023.
• DUKORAL: Sales were €32.3 million in 2024, up 8% from €29.8 million in 2023. The gross margin was 38.7% in 2024 versus 42.4% in the prior year.
• IXCHIQ: Recognized initial sales of €3.7 million in 2024. Cost of goods for IXCHIQ were €7.2 million, exceeding sales due to manufacturing overhead.
• Third-party sales: Decreased by €2.5 million to €33.2 million in 2024, driven by third-party supply constraints.

Guidance

• 2025 product sales are expected to reach €170 million to €180 million, with total revenues between €180 million and €190 million.
• R&D investment is anticipated to be between €90 million and €100 million as the company advances clinical and preclinical assets.
• Operational cash burn is expected to decrease by over 50% from 2024's over €60 million to around €30 million in 2025. The company targets one clinical program to enter Phase 3 post-Lyme data and seeks non-dilutive funding for clinical programs.

Risks

• Uncertainties in ACIP and CDC processes that could impact vaccine uptake and approval timelines.
• Delays in regulatory approvals and market access for products like IXCHIQ.
• Dependence on successful clinical outcomes and regulatory approvals for pipeline candidates such as VLA15.

Question and Answer

• Q: Elaborate on cash burn guidance and R&D expenses increase. A: Peter Bühler stated that cash burn reduction is driven by sales growth, cost containment, working capital focus, and expected R&D tax credits. R&D expenses increase due to the chikungunya Phase 4 trial, Shigella program, and pipeline acceleration.
• Q: Risks or opportunities from RFK's role in administration. A: Thomas Lingelbach noted to monitor ACIP delays but emphasized that science will prevail; the Lyme vaccine's efficacy and safety should drive its use if successful.
• Q: IXCHIQ approval in Brazil, R&D tax credits, price rises. A: Thomas Lingelbach mentioned Brazil approval is close to finalization but delayed, Peter Bühler discussed R&D tax credits and no material price rises in 2025.
• Q: IXCHIQ market dynamics, Lyme data timing. A: Thomas Lingelbach discussed growing chikungunya awareness and IXCHIQ market potential; Valneva expects Lyme data readout by the end of 2025.
• Q: IXCHIQ ACIP, Bavarian Nordic, vaccinated subjects. A: Thomas Lingelbach noted uncertainty around MMWR timelines, no comment on competitor products, and normal VAERS case assessment process.