Valneva Q1 2025 Earnings Call Transcript

Quartr
Provided by Quartr
May 7, 2025
Skip to Participants
Operator

Good day, and thank you for standing by. Welcome to the Valneva's First Quarter twenty twenty five Financial Results Conference Call. At this time, all participants are in listen only mode. After the speakers' presentation, there will be the question and answer session. Please be advised that today's conference is being recorded.

Operator

I would now like to hand the conference over to our first speaker today, Joshua Drum, Vice President, Global Investor Relations. Please go ahead.

Joshua Drumm
Joshua Drumm
Vice President, Global Investor Relations at Valneva

Thank you. Hello, and thank you for joining us to discuss Felneva's first quarter twenty twenty five 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 three months ended 03/31/2025, which were published earlier today, available within the Financial Reports section of our investor website. I'm joined today by Valneva's CEO, Thomas Linglebach and CFO, Peter Buehler, who will provide an overview and update on our business as well as our key financial results for Q1 twenty twenty five.

Joshua Drumm
Joshua Drumm
Vice President, Global Investor Relations at Valneva

There will be an analyst Q and 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, 05/07/2025, and Valneva 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.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

Thank you, Josh, and good day to all of you. Pleasure to provide the update during today's earnings call. Yeah, the first quarter twenty twenty five was a solid quarter with strong overall financial performance. Total revenues reached almost €50,000,000. The reduction in operating cash burn is reflecting our continuous focus on cash and cash management and this is also shown in a cash position north of €150,000,000 excluding the recent proceeds from our April ATM transaction And in quarter one, we also made progress on the regulatory front predominantly around XCHIC label extensions and further approvals.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

When we look a little bit more into the details of the first quarter twenty twenty five, we got a new IXIARO contract awarded by the US Department of Defense. We responded to the French government's call for XCHIC to combat the chikungunya outbreaks in La Reunion and Mayotte. And we responded to the cholera outbreak in Mayotte by supplying doses of DUKORAL. So all in line with our mission to address unmet medical needs. With regards to the key regulatory achievements that I mentioned earlier, we got the marketing authorization for XCHIC in The UK in individuals 18 years of age and older.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

And we also submitted the respective adolescent label extension application. We got the XCHIC label extension in Europe for individuals 12 years of age and older by the European Medicines Agency. And the XGIC marketing authorization in Brazil represents the first approval of a chikungunya vaccine in an endemic country. On clinical data and pipeline progress, we reported high sustained immune response in adolescents one year after gastric vaccination with a single dose and as part of our phase three. We reported positive phase two pediatric results for XCHIC and as such could decide the dose for the planned phase three study in the pediatric population.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

And we initiated the first vaccination in the phase two infant study in Africa of our tetravalent Shigella vaccine candidate s four v two. Turning our attention a little bit to Lyme. You all are very aware of the Lyme program and the medical needs that Lyme disease represents globally. There is no vaccine available to prevent Lyme disease in humans, and we see a growing annual burden of disease with almost half a million cases reported, and these are confirmed cases reported in The United States, more than one hundred thousand cases reported in Europe, and those numbers are heavily impacted by underreporting or not even existing reporting systems in some of the countries. When we look at the clinical manifestations, two to thirty percent develop really severe clinical manifestations, including cauditis, neuroborreliosis, or arthritis, and five to ten percent have persistent symptoms even following treatment.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

Therefore, we see a huge unmet medical need for a preventative solution and hence commercial opportunity for Valneva, especially given that we are talking about almost ninety million people in The US and more than two hundred million people in Europe who live in endemic regions where Lyme represents a major risk. You all know that we are in year three or in the third tick season of the ongoing phase three study VALOR, and we are expecting first data at the end of this year. This is a study that includes more than 9,000 participants five years of age and above who are at high risk of Lyme disease. We are measuring here against the placebo controlled setting, randomized one to one, against placebo two to one North America Europe, and the primary endpoint is the rate of confirmed Lyme disease cases, So prevention of the disease after the second consecutive tick season. And right now, we have the second cohort undergoing the booster vaccination.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

And then we have quite a significant number of secondary endpoints, including the rate of confirmed Lyme disease cases after the first season, after the primary series. So, very exciting year and we hope to see the first data set by the end of the year, which will be followed by a significant number of secondary endpoints and other data associated with the study. Provided positive data, we expect filing with the regulatory authorities next year. With that, let me turn over to ICSHIC. You know that our chikungunya vaccine is a highly differentiated vaccine, and we are glad that we have been able to report strong clinical data thus far across all the studies and across all the target populations that we have been evaluating and got licensed by now.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

At the same time, we have experienced recent changes to ICIC recommendations in response to reports of serious adverse events in frail elderly individuals. As such, ACIP recommended precaution for use in 65 EMA cautioned against use in frail older adults, especially those with comorbidities and transsuspendage recommendation for use in 65. All of that, you know, pending ongoing investigations. As we stated in our different publications and communications, we are highly committed to standards of safety and appreciate, therefore, these precautionary decisions. All investigations into SAEs remain ongoing, and it's worth noting that causality has not been definitely established at this point in time.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

We will, of course, continue to closely monitor all reported adverse events and cooperate fully with health authorities while working proactively on a potential update of the product indication. We have now a bit more than 40,000 doses administered. So, doses of XGRICs that landed in people's arms. And we continue to see a positive risk benefit in the vast majority of people with potential exposure to the disease. And we would like to remind one more time that must not be given to people who are immunodeficient or immunosuppressed due to disease or treatment.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

When we look at the further development of XCHIC that we are currently conducting, we are preparing for the post marketing effectiveness phase four program. This is a program to confirm the effectiveness following licensure based on an immunological surrogate of protection, the so called accelerated approval pathway, and to further help optimizing description of the safety profile. We are planning an observational effectiveness study in Brazil, pragmatic randomized control effectiveness and safety study in endemic countries, and prospective safety cohort study in pregnancy surveillance in Brazil. We have ongoing label extensions to expand access to the vaccine for all age groups. And we reported already the data, phase three data in adolescents, which landed in some countries and some regulatory jurisdictions already in a label extension.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

Others are still under review. And we plan to start a phase three study in children aged one to 11 years of age. On the product profile, all of that and across all programs, we would like to confirm the long term durability of the immune response to further differentiate our vaccine. Turning to Shigella, which is really the most advanced program right now in the tetravanin bioconjugated vaccine space targeting tuberculosis infections. It's a program that we have partnered with LEMATEX.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

It includes the four most common pathogenic Shigella bacteria serotypes. Limatec in the past reported positive phase onetwo clinical data, and the program got awarded FDA Fast Track Designation. We expect a huge unmet medical need, of course, primarily in children living in low medium income countries, but also a substantial added value for travelers and military personnel. And the Shigella disease and the work around Shigella vaccines have been identified as a priority by the World Health Organization. As mentioned at the beginning, we launched a phase two infant study this year, and we expect data already towards the latter part of this year.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

We have an ongoing phase 2b so called controlled human infection models. This is a study that goes in two steps. The first step is to optimize dose schedule. Second is to challenge and get with the challenge a first idea around pilot efficacy. We announced that we have slightly extended the immunogenicity phase, so the so called step one.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

And as such, we are not expecting the pilot efficacy data as previously announced in the second half of this year, but in the first half of next year. And of course, we will work continuously on this exciting program and make sure that we progress towards the next development phases. Turning to Zika, we expect phase one results later this year on our second generation optimized vaccine candidate against the Zika virus. It's an inactivated whole virus vaccine based vaccine that leverages our technology that we developed and further optimized as part of our COVID work and our COVID vaccine during the pandemic, VLA two thousand and one. And of course, we hope to see positive data that would enable further development against the disease that can have quite devastating effects.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

And please be reminded that there is currently absolutely no vaccine or specific treatment available. And as such, we hope also for support of public institutions, for example, to help advance a potential vaccine against Zika virus. With that, I would like to hand over to Peter to provide us with the financial report.

Peter Bühler
Peter Bühler
CFO at Valneva

Thank you, Thomas, and good morning and good afternoon to all of you. Now let's look at the financial report for the first quarter of fiscal year twenty twenty five. Product sales reached €48,600,000 and increased by 51.2% versus the first quarter of the prior year. IXIARO sales reached €27,500,000 60 5 point 5 percent above last year, and the year over year growth is driven by a strong increase in sales to US military, but also into the travel channels. In addition, the first quarter includes higher sales related to stock replenishment in indirect markets. As you may recall, the first quarter of twenty twenty four had been adversely impacted by supply constraints.

Peter Bühler
Peter Bühler
CFO at Valneva

Dukorav sales grew by 9.4% and reached €12,300,000. The increase in Dukorav sales is primarily driven by a shipment of €1,100,000 to the French island Mayotte. Xtrig sales reached €3,000,000 in the first quarter of twenty twenty five, compared to €200,000 in the first quarter of last year. Xtrig was first launched in The United States in quarter one of twenty twenty four and the increase in sales is related to the continued ramp up of sales in The United States, and the launch in additional territories, mainly in France and Canada. In the first quarter of twenty twenty five, we received an order for 40,000 doses of XGIC to respond to the chikungunya outbreak on La Reunion.

Peter Bühler
Peter Bühler
CFO at Valneva

The significant majority of these doses were shipped early April and hence sales will be recorded in the second quarter. Third party products increased by 41% to €5,800,000 compared to €4,100,000 in the first quarter of last year. As mentioned previously, we expect third party product sales to decrease over time and this year over year increase for Q1 is primarily due to supply constraints faced by our third party partners in Q1 of last year. Over time, we expect the continuous reduction of our third party business to have a positive impact on the company's gross margin. Foreign currency effects have no material impact on the year over year sales performance.

Peter Bühler
Peter Bühler
CFO at Valneva

I'm moving on to the income statement. Total revenues reached €49,200,000 versus €32,800,000 in the first three months of twenty twenty four. Cost of goods and services increased marginally versus prior year, despite the significant increase in sales. Gross margin on commercial products, excluding XGIC amounted to 62.7%, compared to 43.9 in the first quarter of twenty twenty four. The significant improvement in gross margin is primarily due to better manufacturing performance with fewer batch failures and inventory adjustments.

Peter Bühler
Peter Bühler
CFO at Valneva

ICSIARA's gross margin reached 72.6%, which is significantly better than the 52% of last year and even exceeds pre COVID levels. DUKORA's gross margin reached 52.2% compared to below 40% in the first quarter of last year. Research and development expense increased by around €2,000,000 to €15,000,000 driven by costs related to our new Shigella program, following the start of our collaboration with Limatec Biologics in the fourth quarter of last year. Marketing and distribution expense in the first quarter reached €10,400,000 compared to €11,300,000 in the prior year. The decrease is mainly related to lower advertising and promotion expense.

Peter Bühler
Peter Bühler
CFO at Valneva

General and administrative costs were reduced to €9,000,000 compared to €11,700,000 in the prior year. The decrease is related to a lower spend on recruiting, lower insurance costs and savings in professional services. The operating loss of the first quarter twenty twenty five is reported as minus €6,000,000 compared to an operating profit of €68,200,000 in the first quarter of the prior year. The first quarter of twenty twenty four, we sold the Priority Review Voucher obtained upon approval of chikungunya vaccine Xtrig in The United States. This resulted in a non recurring revenue of €90,800,000 Net finance and income tax expense is reported at €3,300,000 compared to €9,300,000 in the prior year.

Peter Bühler
Peter Bühler
CFO at Valneva

The lower expense is mainly related to a foreign exchange gain of €3,700,000 due to the development of the US dollar versus euro exchange rate and the related balance sheet revaluation. With this, the loss for the first quarter of fiscal twenty twenty five reached €9,200,000 compared to profit of €58,900,000 in the prior year. EBITDA is slightly negative, while last year was positive driven by the sale of the priority review voucher. Before we move to the guidance, a word on cash. As mentioned by Thomas at the beginning of the call, total cash and cash equivalents at the March were €153,000,000 compared to €168,000,000 at the end of prior fiscal year.

Peter Bühler
Peter Bühler
CFO at Valneva

In the first quarter of twenty twenty five, we significantly reduced the cash used in operations compared to the prior year from €28,400,000 to €8,100,000 mainly driven by higher sales and good cost control. In addition, as mentioned at the beginning of the call and as stated in our press release, in April we issued new shares for a value of €14,200,000 through our asset to market program, based on a reverse inquiry from Novo Holdings. Through this transaction, plus additional shares acquired in the open market, Novo is now one of our top shareholders. Now moving to slide 22 to review our guidance for fiscal year 2025. The guidance is unchanged compared to the full year 2024 earnings call.

Peter Bühler
Peter Bühler
CFO at Valneva

We reiterate our product sales guidance of 170,000,000 to €180,000,000 for the fiscal year and total revenues of 180,000,000 to €190,000,000 Total R and D expense are expected between 90,000,000 and €100,000,000 partially offset by grant funding and R and D tax credits. As demonstrated in the first quarter, we are on track to reduce our operational cash burn by 50% on a full year basis, with the goal of being able to reach key inflection points with our existing cash. In the midterm, we continue to focus on gross margin and we see a path to potential sustained profitability from 2027, based on a successful Lyme disease vaccine approval and commercialization. This concludes the finance section of this call, and

Peter Bühler
Peter Bühler
CFO at Valneva

I would like to hand back to Thomas to discuss our major growth drivers.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

Thank you so much, Peter, for this comprehensive financial report. Turning to page 24 of the presentation, looking a little bit into our expected growth drivers for 2025 and beyond. Of course, it's all about Lyme for the time being and therefore, you know, we are very much looking forward to the results of BLA fifteen and hopefully its success, which as Peter pointed out has the potential for sustained profitability upon approval and commercialization, of course, driven by the substantial milestones and royalties kicking in towards the latter part of twenty twenty seven according to current timelines and expectations. When we look at the commercial business, we have shown that we have been able to optimize and grow our commercial business and we expect in the near term continued growth for both of the existing older brands like IXIARO and DUKORAL, but also expect XCHIC to gain further global traction.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

When we look at the future pipeline, we expect really value creation through new pipeline programs and ongoing programs that we have already in the pipeline including Xigela and Sika and our goal, as communicated previously, is to have a next phase three program ready post successful introduction of the Lyme vaccine. And with that, we see overall a really good prospect of our business with of course major growth drivers around Lyme, but also major growth expected from our commercial business and upside from future or existing clinical and preclinical R and D assets. With that, we would like to conclude our presentation and hand back to the operator to take your questions.

Operator

Thank you. And now we're going to take our first question. And it comes from the line of Mario Raycroft from Jefferies. Your line is open. Please ask your question.

Maury Raycroft
Maury Raycroft
Equity Research Analyst at Jefferies

Hi. Congrats on the progress and thanks for taking my questions. I'll ask a quick one on Xtrig first and then one on Lyme. Guess for Xtrich, just wondering what are next steps regarding the label? Wondering if you've heard back from FDA regarding the label extension application for adolescents that was submitted a couple months ago.

Maury Raycroft
Maury Raycroft
Equity Research Analyst at Jefferies

And then what are next steps regarding potential need to add new language safety?

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

Yeah, thanks for your question, Maurice. So I'll start with the last one first. The review with the FDA is still ongoing. So we have submitted, as you rightly pointed out, and we are waiting for their reply and hopefully soon the adoption of label to include the 12 and above. Yeah, the current situation and next steps at this stage, we have seen changes to the recommendation, you know, that we are absolutely committed to the highest standards of safety.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

So the investigations are ongoing. We know that all of that has occurred in frail older individuals. We have strongly recommended and continue to do so that healthcare providers apply individualized clinical judgment when determining the appropriateness of XJIC for elderly, afraid patients. We are supporting the regulatory authorities as much as we can on evaluating those cases and will review also whether, you know, certain additional precautions or contraindications in specific population groups may be warranted.

Maury Raycroft
Maury Raycroft
Equity Research Analyst at Jefferies

Got it. Okay, and it makes sense. And then for the phase three Lyme study, can you remind me what the p value threshold is for the primary endpoint of confirmed Lyme cases? And when considering GMT from historical studies, how are you setting expectations for the bar and what antibody titer you will need to achieve to get sufficient protection?

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

So unfortunately, I can't disclose the p value for the phase three study, but it is sufficiently powered according to the expectations and according to the, let's say, epi studies and disease burden evaluations, which most of them got published by Pfizer. And I think that's basically what we can say. I would like to point your attention to a publication, a joint publication that we also referenced by Pfizer and Valneva where you know I would say a potential protective immunological threshold has been you know hypothesized I would say. I think we discussed in length in the past, Maury, that it is very difficult at this point in time. There has never been an immunological correlate for Lyme.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

And of course, assays are very different. Mean, we can, of course, send you again the link to the respective publication.

Maury Raycroft
Maury Raycroft
Equity Research Analyst at Jefferies

Okay. Yeah. That sounds good. That would be helpful. Okay.

Maury Raycroft
Maury Raycroft
Equity Research Analyst at Jefferies

Thanks for taking my questions. I'll hop back in the queue.

Operator

Thank you. Now we're going to take our next question. And it comes from the line of Rajan Sharma from Goldman Sachs. Your line is open. Please ask your question.

Rajan Sharma
Rajan Sharma
Executive Director at Goldman Sachs

Hi, thanks for taking my question. So just one on Lyme actually. So I think you're due $143,000,000 in milestones from Pfizer as an initial milestone. I was wondering, is that part would part of that be due with a potential positive Phase III? Or is that related specifically to approvals, whether that's in The U.

Rajan Sharma
Rajan Sharma
Executive Director at Goldman Sachs

S. Or elsewhere? And then secondly, I was just wondering if you could just comment on tariffs, which is obviously a focus in the sector at the minute. It'd be helpful just to get your perspectives on potential impact for Valneva. Could you just help us understand your manufacturing footprint and any potential mitigations you may have? Thank you.

Peter Bühler
Peter Bühler
CFO at Valneva

Yeah. Hey, Rachan, it's Peter. Thanks for the questions. So yes, you're absolutely right. There is a milestone of 143,000,000 that Pfizer would pay us upon first commercialization.

Peter Bühler
Peter Bühler
CFO at Valneva

So it's not at the end of phase three. There are basically three triggers for that. There are three parts of the 143,000,000. There is first commercial sales in The US, First commercial sales in Europe and ACIP opinion. And all three events are supposed to happen in 2027 basically.

Peter Bühler
Peter Bühler
CFO at Valneva

On tariffs, and just to add maybe that there is another, there will be another 100,000,000 commercial milestones afterwards based on sales thresholds, cumulative sales thresholds and royalty rates of between 1422%, just to remind everybody. On tariffs, it's obviously something we're closely following. I think right now it's difficult to express an opinion on it, because nothing has been defined in terms of tariffs. So too many unknowns. We are, of course, looking at potential mitigation strategy or initiatives.

Peter Bühler
Peter Bühler
CFO at Valneva

To your question on manufacturing footprint, so our vaccines are basically all manufactured in Europe. So drug substance Ixjaro Dichstriq is manufactured in Scotland. And then fill finishing happens in Germany. And as far as TuKro is concerned, it's all produced in Sweden, and the IP is also in Europe.

Rajan Sharma
Rajan Sharma
Executive Director at Goldman Sachs

Okay. Thank you.

Operator

Thank you. Now we're going to take our next question. And it comes from the line of Amil Divan from Guggenheim Securities. Your line is open. Please ask your question.

Vamil Divan
Managing Director & Senior Research Analyst at Guggenheim Securities, LLC

Great. Thanks for taking my questions. Maybe a couple on the financial side. So one, the sales this quarter were quite a bit higher than consensus. You obviously maintained your full year guidance.

Vamil Divan
Managing Director & Senior Research Analyst at Guggenheim Securities, LLC

So I'm just trying to get a sense of the nuances there, maybe relative to what you see from consensus estimates right now. Just one in terms of sequencing of the DoD sales that drove through the first quarter for CRO, maybe. Is that a reason not be too optimistic on that read through the rest of the year? Or is there maybe some sort of conservatism built in, given some of the label updates that are coming on that front? And then the second question is just more on the gross margin side.

Vamil Divan
Managing Director & Senior Research Analyst at Guggenheim Securities, LLC

Think you've talked about kind of getting back to these pre pandemic levels. I think Ichthix are one of the key drivers there. Just if there was a shift in sort of uptake of that vaccine, given some of the new label updates and safety questions, do you still feel comfortable getting to the pre pandemic levels on gross margins, even again if your product mix maybe shifts a little bit? Thanks.

Peter Bühler
Peter Bühler
CFO at Valneva

Yeah, thanks for the question. So starting with sales, yes, absolutely. Our first quarter revenues are above the consensus. I think it was expected by us. And as I said in the call, so we did see strong growth in particular on ICSIRO on both travel and also DoD.

Peter Bühler
Peter Bühler
CFO at Valneva

But as I mentioned, last year was very heavily impacted by restricted supply. That was resolved in April of last year. So you will see this year slightly different phasing, which is also why we do not see right now any change to our guidance. So first quarter for us was in line with what we had anticipated. As you know, sales to the Department of Defense, so we have not published the number.

Peter Bühler
Peter Bühler
CFO at Valneva

But as you saw, we signed a new contract and supply is ongoing according to plan. And it has indeed it's also increased versus prior year. In terms of gross margin, we said in the past that we expect XCHIC to over time yield a better gross margin than the other products. I think that we're still considering this, of course. This has not changed.

Peter Bühler
Peter Bühler
CFO at Valneva

I think overall Q1 gross margin was very good. And you're right, we did say in the past we expect to reach a pre pandemic level. Although we have not defined this for 2025, we have not guided on gross margin for 2025. But of course, we're very pleased to see where we were in Q1.

Vamil Divan
Managing Director & Senior Research Analyst at Guggenheim Securities, LLC

Okay. Thank you.

Operator

Thank you. Now we're going to take our next question. And it comes from the line of Samir Devani from Rx Securities. Your line is open. Please ask your question.

Samir Devani
Managing Director at Rx Securities

Hi, guys. Thanks for taking my questions, and congrats on a good quarter. Have you now fulfilled the Myonat order in this quarter?

Peter Bühler
Peter Bühler
CFO at Valneva

The La Rignon?

Samir Devani
Managing Director at Rx Securities

Is the Not the Rignon. The Maionette order.

Peter Bühler
Peter Bühler
CFO at Valneva

Oh, the Maionette. Yes. So that was the two corral. Yes. That was actually fulfilled in the first quarter.

Samir Devani
Managing Director at Rx Securities

Okay, fine. And then just on the Lara Union order, can you help us in terms of thinking how we should phase this in terms of our modeling for XJIC? Is it going to lead to a reasonable spike in the next quarter and then sort of fall away in Q3?

Peter Bühler
Peter Bühler
CFO at Valneva

Yes, as we said, we supplied a small number of doses at the end of Q1 and the remaining part will be supplied in Q2 or is was already supplied in Q2, should say. Okay.

Samir Devani
Managing Director at Rx Securities

And then finally, on the mechanism for XCHIC and it's being alive attenuated. I'm just wondering, Thomas, if you could comment on, has this made you reconsider the sort of dose that you might use in the pediatric studies in light of the potential adverse events you're seeing in the elderly?

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

It's it's of course good question. So we don't see at this point in time any unexpected safety profile in younger adults or even adolescents. So at this point in time, we have not reconsidered the dose for the phase three infant study that we had previously announced. But as I said, at this point in time. So that's all I can say for now.

Samir Devani
Managing Director at Rx Securities

Okay. That's great. Thanks very much.

Operator

Thank you. Now we'll proceed with our next question. And the question comes from the line of Suzanne Van Verghoizen from Van Laertschot and Kempen. Your line is open. Please ask your question.

Analyst

Hello. This is Samuel on for Suzanne. Thank you for taking our questions. For the Lyme phase three program and the last tick season now starting, can you provide some color on the infection rate so far in this study? And is this monitored and in line with the company's expectations?

Analyst

And secondly, with the study consisting of two sequential cohorts of subjects, is the first cohort receiving a second booster this season already? And will you report data on this too at the year end readout? And then lastly, regarding the latest news that came from vaccine policymakers, could you comment which elements may or may not affect your vaccine business? And do you see particular risks or opportunities there?

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

So many questions. So thank you for that. So I would say we have not, yes, we are of course monitoring the, on an ongoing basis, the overall Lyme cases during the study. We are and will not comment on those other than we have seen the overall profile over the past couple of years being pretty consistent in terms of number of Lyme cases. And we see at this point in time no concerns.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

With regards to the study cohort, the answer is no. With regards to the other activities that you were mentioning, impact on the business, I mean, at this point in time, probably no one is able to really say what all these political dynamics in The United States mean with regards to any of the vaccines on the market or in development. And I think we should probably not speculate about that. And will it have an impact? Probably yes, probably not.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

So I think we have to wait until certain things become more defined and turn into real requirements or policies.

Operator

Excuse me, any further questions?

Analyst

Thank you very much.

Operator

Thank you. Now we're going to take our next question. And it comes from the line of Oskar Hafenlam from Bryan, Garnier and Co. Your line is open. Please ask your question.

Oscar Haffen Lamm
Equity Research Analyst - Healthcare at Bryan Garnier

Hi, Zima. Thank you for taking my questions. So the first one on IXIARO. Relative to Q4 last year, sales work is similar. So I just wondering if there were any seasonality effects seen during this first quarter.

Oscar Haffen Lamm
Equity Research Analyst - Healthcare at Bryan Garnier

And then maybe how you forecast the growth of the asset for the remaining of the year?

Peter Bühler
Peter Bühler
CFO at Valneva

So on IXIARO, like I said, the impact is more quarter over quarter. I don't think there is any particular seasonality impact in Q1, except as I mentioned also, particularly in one of our indirect markets, there's probably some stocking effect. But in the overall picture, I would not say it's absolutely material. And I'm sorry, I didn't get the second question. Can you maybe repeat that one?

Oscar Haffen Lamm
Equity Research Analyst - Healthcare at Bryan Garnier

Yes, just how do you forecast the growth of for the remaining of the year?

Peter Bühler
Peter Bühler
CFO at Valneva

Oh, yes. So we have not guided specifically on ICSIRO, but what we did say is we expect ICSIRO to continue to grow the double digit CAGR, which we would expect for this year, up to growth. But we have not guided specifically on a number for XERO.

Oscar Haffen Lamm
Equity Research Analyst - Healthcare at Bryan Garnier

Okay. Thanks. And maybe quickly a second question, this time on XERO. I was wondering if, you know, following the updated recommendation from the French HAS, there could be a potential impact related to the order book of vaccines that were ordered for the outbreak in La Runion.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

We have at this point in time confirmed the forty thousand dose order, and we delivered the 40,000 dose order, and all the rest we have to see.

Oscar Haffen Lamm
Equity Research Analyst - Healthcare at Bryan Garnier

Okay. Thank you.

Operator

Thank you. Dear participants, as a reminder, if you wish to ask a question, please press star one one on your telephone keypad. And the question comes from the line of Simon Scholes from First Berlin. Your line is open. Please ask your question.

Simon Scholes
Senior Analyst – Biotech and Resources at First Berlin

Yes. Good afternoon. Thanks for taking my questions. I've got three. First of all, was wondering if you could give us some color on the idle capacity costs and your efforts to reduce these.

Simon Scholes
Senior Analyst – Biotech and Resources at First Berlin

And secondly, on the ICSIARO gross margin, was 73% in Q1. I mean, do you think the gross margin on Ixiao is sustainable at this level? And on the DUKORAL gross margin, do you expect that to be able to get that closer to 60% over time? Thanks.

Peter Bühler
Peter Bühler
CFO at Valneva

Yes. So let me start with the gross margin questions. So on ICSIARO, we do think that Q1 was probably not representative where it will be for the full year. We do expect an improvement, of course, versus prior year. But, you know, I think north of 70%, I think, is probably not what we will see for the full year.

Peter Bühler
Peter Bühler
CFO at Valneva

I think on on DUKORAL, we haven't guided on the gross margin, but I think the Q1 gross margin is probably roughly representative. On the idle cost, so for the first quarter, I would say it was probably roughly around €2,000,000 so this is primarily related, of course, one, because we have large capacity, but also because some of the especially the new manufacturing sites in Scotland, we are in progress of transferring over production. So over time, we will see a reduction that idle costs, of course.

Simon Scholes
Senior Analyst – Biotech and Resources at First Berlin

Okay. Thanks very much.

Operator

Thank you. Now we're going to take our next question. Just give us a moment. My apologies. Yes.

Operator

You can please standby. Excuse me, Suzanne. I know that you would like to ask a question. If you don't mind, please, can you press 11 again? Dear speakers, there are no further questions for today.

Operator

I would now like to hand the conference over to the management team for any closing remarks.

Thomas Lingelbach
Thomas Lingelbach
President, CEO & Member of the Board of Directors at Valneva

Thank you so much for your attention today. Good questions, as usual, and your interest in following the company closely. And we are looking forward to staying closely in touch while we are focusing on our execution this year to build strategic value for the future. Thank you so much.

Operator

This concludes today's conference call. Thank you for participating. You now may all disconnect. Have a nice day.

Executives
    • Joshua Drumm
      Joshua Drumm
      Vice President, Global Investor Relations
    • Thomas Lingelbach
      Thomas Lingelbach
      President, CEO & Member of the Board of Directors
    • Peter Bühler
      Peter Bühler
      CFO
Analysts
Powered by Quartr

Key Takeaways

  • Valneva delivered a solid Q1 2025 with total revenues of €49.2 million (up 50% year-over-year), product sales of €48.6 million, reduced operating cash burn to €8.1 million and cash reserves north of €150 million.
  • A new US Department of Defense contract for the IXIARO® vaccine was secured, and Valneva supplied XCHIC® and DUKORAL® doses to combat chikungunya and cholera outbreaks in La Réunion and Mayotte.
  • Key regulatory wins include XCHIC authorizations in the UK (18+), a label extension in the EU (12+) and Brazil’s first chikungunya vaccine approval; the US adolescent label is under FDA review.
  • Pipeline progress spans the ongoing Lyme phase III VALOR trial (9,000+ participants, data expected end-2025), phase 2 Shigella studies in infants and CHIM, and Zika phase I readout later this year.
  • Despite ACIP/EMA precautions on XCHIC use in frail elderly after reported serious AEs, >40,000 doses have been administered with causality still undetermined and a broadly positive risk-benefit profile.
  • 2025 guidance was reiterated with product sales of €170–180 million, total revenues of €180–190 million, R&D spend of €90–100 million, a 50% reduction in cash burn, and a path to sustainable profitability by 2027.
AI Generated. May Contain Errors.
Earnings Conference Call
Valneva Q1 2025
00:00 / 00:00

Transcript Sections