Valneva SE

Thank you. Hello, and thank you for joining us to discuss Valneva's full year 2023 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 12 months ended December 31, 2023, which were published earlier today available within the Financial Reports section on our Investor website.

I'm joined by Valneva's CEO, Thomas Lingelbach; and our CFO, Peter Buhler, who will provide an overview and update on our business as well as our key financial results for the year. There will be an analyst Q&A session at the conclusion of the prepared remarks.

Before we begin, I'd like to remind listeners that during this presentation, we'll 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, March 20, 2024, 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.

Thank you so much, Josh, and welcome to today's earnings call. Yes, the year 2023 was not a year without challenges, but also a year with many achievements we are proud of.

We made excellent progress across our R&D pipeline. And of course, 2023 was our chikungunya year.

We got FDA approval for the world's only and first chikungunya vaccine and very recently, ACIP recommendation and respective adoptions. We enrolled the Phase III study with Pfizer on Lyme completely.

And we are just about to reentering Phase I with the second-generation Zika vaccine. And I'm going to go into more details on all of these programs.

We have seen significant growth of our commercial business. Our product has surpassed prepandemic sales by 12% and 2022 sales by 26%.

Both IXIARO and DUKORAL, our proprietary brands grew more than 70%, respectively, versus 2022. And overall, products, they grew 63% versus 2022, excluding the COVID-19 sales and Peter will go into much more detail.

We have solidly funded with a strong midterm financial outlook. We had more than €120 million cash at year-end.

We augmented that with close to €100 million as proceeds from our PRV sales early this year. And very recently, we extended the repayment of our interest-only period of the existing loan facility, which, of course, results in a significantly lower cash burn for the company.

The operational business is, therefore, considered sufficiently funded, excluding debt repayment, of course, at a certain point in time, until the Lyme commercial revenues enable a sustained profitability for Valneva. When we look at the business in more detail, I would like to start this time with our strategy.

Where do we see this company going? And as we have said already more than 10 years ago when we created Valneva, our strategy is to become a globally recognized vaccine company, fully integrated, focused on the development, manufacturing and commercialization of vaccines in areas of unmet medical needs, contributing to our vision to a world where no one die or suffers from a vaccine-preventable disease.

We see our strategy in 3 key pillars: number one, driving commercial growth. With the recent approval of IXCHIQ in the United States and our expected forthcoming approvals in other territories, we see really the opportunity to unlock IXCHIQ value by building awareness and market and growing.

We hereby capitalize on the bundling effect within our existing travel business. We will further expand global reach more addressing low medium-income countries through partnerships, and with a change in the overall setting and the portfolio and more focus on proprietary products, we see really cash flow positivity from the commercial business 2025 onwards.

The second pillar is to capture our R&D upside. We will continue investing in new vaccines that address high unmet medical needs, and we will leverage our proven R&D engine and strategic partnerships.

And we believe we are well positioned to do that, having developed 3 vaccines in the meantime from early discovery to licensure. We will continue focusing on vaccines that can make a difference.

First, only, best, and we will generate meaningful catalysts for our investors, targeting the next Phase III entry post Lyme. We will maximize our integrated business model.

We believe we are one of the very few companies left in the group vaccine space that can really build on an integrated model. So which means we will build continual value from R&D and commercial execution.

We will support the timely approvals of our Lyme vaccine, which we continue to see as the single largest catalyst going forward. And by doing so, we see the possibility to achieve sustained profitability with potential successful commercialization and revenues on Lyme from our partner, Pfizer.

When we look at IXCHIQ, the world's first and only chikungunya vaccine. It's FDA proved in adults, more additional regulatory approvals are expected this year.

It's a life attenuated vaccine that offers strong and long-lasting protection from a single shot, and we target a minimum of 5 years here. The FDA approval triggered also the PRV, which we sold, as I mentioned earlier, and the ACIP recommended the vaccine for certain travelers and laboratory workers.

The U.S. launch is well underway, and we are selling through our existing and proven commercial infrastructure.

Going forward, we see 3 key segments in terms of market opportunity. One, of course, travelers, military, but also an opportunity for stockpiles given that chikungunya is on the list of potential outbreak preparedness of diseases.

We will continue leveraging partnerships for Latin America and other LMICs. And with more visibility on the travel sector, the awareness around chikungunya, the market opportunity around chikungunya, we clearly see that the global market for chikungunya vaccine will exceed €0.5 billion with probably €300 million to €400 million represented alone by the segment I was talking about earlier.

In terms of upcoming milestones, I mentioned the additional anticipated approvals EMA, Health Canada and Anvisa in Brazil. And we will, of course, also initiate the regulatory process in the U.K.

Towards the latter part of this year, we will further go through the clinical development mainly the Phase IV clinical program, but also other clinical activities, e.g. in the pediatric field.

And as we generate more and more data, we will undergo filings for a potential label expansion. I mentioned already that our CHIK vaccine has a very differentiated target profile.

It shows a rapid and long-lasting immunity across all age groups tested. And here, I would like to specifically point out that the vaccine has very, very high sero protection levels, including the most vulnerable population, namely elderly above 65 years of age, which has been specifically mentioned in the CDC adopted ACIP recommendation.

We have close to 100% seroresponse rates after the single vaccination and this has been maintained at a very high level over time. We got data already up to 2 years, we will generate data up to 3 years.

And on safety, the vaccine is generally well tolerated. Of course, it is a life-attenuated vaccine, life attenuated vaccines has the advantage that with a single shot, you have a very long protection, but there is a certain level of [indiscernible], but this is absolutely in line with other well-established life attenuated vaccine in the market.

We recorded adolescent trial data, and this data suggests a favorable safety profile regardless of previous CHIKV infection. Turning to our Lyme disease vaccine candidate, VLA15.

It is today the world's leading vaccine candidate against Lyme disease. It's the only program in advanced clinical development today.

By way of reminder, it is a multivalent recombinant protein-based vaccine that targets the 6 most prevalent serotypes of Lyme borreliosis in the Northern Hemisphere, it follows a proven, established and validated mode of action. We got U.S.

FDA Fast Track designation. And as I mentioned at the beginning, the Phase III pivotal efficacy study is now fully enrolled.

The program is partnered with Pfizer. They have an exclusive worldwide rights to commercialize this product, and we anticipate the market opportunity to be north of $1 billion.

We have already received under the partnership with Pfizer, a certain milestone payments. But overall, we are eligible for milestones up to $408 million.

And upon successful commercialization tiered royalties from 14% to 22%. When we look at the upcoming milestones, which are in the short term or execution related, of course, we will, and this is an important point when we talk later about the financials, complete our financial contributions to Pfizer in the first half this year.

Then on the execution side, we expect a complete full vaccination for Cohort 1 and the primary vaccination for the Cohort 2, meaning the Cohort 1 will have received 3 doses primary plus dose booster. We will later in the year, see the 2-year antibody consistent and booster results, which will give us a better indication as to whether this vaccine will require an annual booster later or not.

And as guided many, many times, we expect efficacy results from the Phase III trial at the end of 2025 which and if successful, will support regulatory filings, which we currently foresee in parallel in the United States and Europe in 2026. Slide 12 of the presentation shows one more time the Phase III efficacy study design.

You remember that following initial operational issues, we split it in 2 cohorts, but within 1 study, roughly 50-50. We have now enrolled more than 9,000 participants.

The study is randomized 1:1 vaccine against placebo, 2:1 North America versus EU. And the primary endpoint is the rate of confirmed Lyme disease cases after 2 consecutive tick seasons.

And when I mentioned earlier, full vaccination to be expected for Cohort 1 is imminent and then of course for Cohort 2, the booster vaccination will come next year. Turning to Zika.

I mentioned at the beginning that we have decided to reenter clinical development of Zika vaccine. We are leveraging what we call our optimized second-generation platform, which is a platform that originates from our Japanese encephalitis vaccine IXIARO, got further than extended and optimized for our COVID VLA2001.

And we believe that this second-generation adjuvanted inactivated whole-virus vaccine platform is perfectly suited for Zika. And so Zika is as many of you know, also transmitted by Aedes mosquitoes.

We all have experienced and have seen the devastating impact that Zika infection can cause. And today, there are no vaccines or specific treatments available.

It is a PRV eligible disease, and there is potential funding from public institutions. And we see there are clearly opportunities given the emerging epidemiology around Zika.

In terms of next milestones, we will execute the Phase I clinical trial with the enhanced process and optimized vaccine formulation. And then we will decide on the further development strategy, considering the results, of course, more insights around the market opportunities and external nondilutive funding.

With this update on the business, I would like to hand over to Peter to provide us with the financial report.

Thank you, Thomas. Good morning or good afternoon to all of you.

Now let's look at the financial review of our fiscal year 2023. Total product sales surpassed prepandemic levels by 12%, reaching €144.6 million towards the upper range of our sales guidance.

This represents an increase of 26% versus prior year. 2023 product sales included €5.7 million in sales of our COVID-19 vaccine, VLA2001, which was discontinued in 2022.

We do not expect further COVID sales from 2024 onwards. Product sales, excluding VLA2001 reached €138.9 million, an increase of 63%.

This increase was driven primarily by substantial growth of our proprietary travel vaccines. Looking in more detail, IXIARO sales reached €73.5 million, an increase of 78% versus prior year primarily the result of the continued struggle market recovery as well as price increases.

As at the end of September 2023, we signed a new 1-year contract with the U.S. Department of Defense worth a minimum of €32 million, of which a bit more than half is included in our 2023 sales.

DUKORAL sales reached €29.8 million compared to €17.3 million in 2022 an increase of 72%. Similar to IXIARO, DUKORAL benefited from significant recovery in the private and travel market, particularly in Canada, where there is a strong overlap between travelers to regions of high ETEC travelers, the vaccines approved indication in this country.

Third-party product sales increased by 34% to reach €35.7 million for the fiscal year 2023, which was mainly driven by sales under our distribution agreement with Bavarian Nordic. The very positive sales performance continues to be, as I already mentioned, related to the recovery of global travel markets, several of which have reached our even exceeded pre-COVID levels, and we expect this trend to continue.

Moving on to Slide 17, looking at the P&L. We already covered product sales.

Other revenues, including revenues from collaboration, licensing and services have now returned to the historic levels at €9.1 million compared to 2022, which, as you can see, included substantial one-off noncash revenues related to COVID. Looking at expense, we observed a significant decrease in cost of goods, and this is again mainly the result of one-off effects related to the wind down of our COVID-19 program.

Research and development expenses decreased sharply from €104.9 million in 2022 to €59.9 million in 2023, which was driven solely by the lower spend on COVID-19 vaccine. 2023 expenses were just below our guidance range of €60 million to €70 million.

At the same time, costs related to the Zika vaccine candidate increased as the company plans to reinitiate clinical development imminently. As we ramped up our preparation for IXCHIQ, our marketing and distribution expense increased from €23.5 million in 2022 to €48.8 million in 2023, of which €20.7 million were associated with launch preparations versus only €7.3 million in 2022.

G&A expense increased from €34.1 million in 2022 to €47.8 million in 2023. In 2022, all expense lines benefited from a substantial noncash adjustment related to the positive effect of the costs related to the company's share-based compensation due to the share price performance.

Our G&A costs were also unfavorably impacted by higher compliance cost relates to our U.S. listing and one-off recruiting costs.

Other income increased to €21.5 million in 2023 from €12.2 million in the prior year, primarily due to grant income received from Scottish Enterprise and the gain from settlement with a supplier related to our COVID activities. In 2023, Valneva substantially reduced its operating losses to €82.1 million compared to €113.4 million in 2022 which again was negatively impacted by nonrecurring expenses related to the wind down of our COVID program.

Adjusted EBITDA loss was nearly unchanged year-over-year at €65.2 million versus €69.2 million in 2022. Now moving on to financial outlook on Slide 19.

With the addition of IXCHIQ to our travel vaccine portfolio and with the continued growth we anticipate from our existing products, we expect our commercial business to deliver substantial growth over the midterm. Based on current assumptions, we are targeting an approximately 2x sales growth in the next 3 years.

This will be driven by a differentiated and highly competitive products, IXIARO, which is the only Japanese encephalitis vaccine approved in the U.S. and Europe and the mandatory vaccine for U.S.

troops depot to Asia. IXCHIQ the first and only approved chikungunya vaccine and DUKORAL, the only Cholera vaccine with an additional approval for ETEC in key markets.

Next slide, please. We have raised our 2024 product sales guidance since our February announcement, now estimated between €160 million to €180 million in product sales versus previously €150 million to €180 million.

This revised estimate takes into account an improved outlook regarding anticipated IXIARO supply constraints and still assumes approximately 20% to 30% reduction in third-party sales this year, driven by external supply constraints. This brings us to a total revenue estimate of €170 million to €190 million in 2024.

We now expect higher other income compared to our announcement in February, moving from €95 million to €105 million to €100 million, €110 million, largely reflecting the €95 million in proceeds from the sale of the chikungunya PRV. We also lowered and narrowed our research and development expense guidance from between €65 million and €90 million to between €60 million and €75 million.

This was based on additional visibility for our chikungunya, CHIK -- Zika-related expenses as well as an expected non-dilutive contribution from institutions in connection with chikungunya activities and the product tech transfers to Valneva new -- Valneva's new Almeida manufacturing facility in Scotland. As Thomas mentioned, we ended the year with €126.1 million in cash, which was further augmented by €95 million in proceeds from the PRV sale.

This puts us in a very strong position as we expect to work significantly less cash in 2024. This is driven by a few factors, primarily the fact that we expect to complete our contribution to the ongoing Phase III study for VLA15 in the first half of this year.

Secondly, with continued revenue growth for IXIARO and DUKORAL and improved efficiency in our manufacturing processes, we expect our commercial business, including IXCHIQ to be cash positive this year, and it has -- as it has been prepandemic, and we anticipate significant further growth going forward. I'm now handing back to Thomas to complete the midyear outlook.

Thank you so much, Peter. Yes.

So it is important that we address also many, many questions that we have received in the market about the more midterm prospects of our business and where we see this business going, which is also why I started the presentation by reminding everyone of the Valneva trajectory. When we look this more completely into a midterm outlook, Peter mentioned that the proprietary business, excluding IXCHIQ will already be cash flow positive this year, including IXCHIQ, we expect the commercial business to contribute cash and help financing our R&D from 2025 onwards.

This is driven by continued travel sales growth for IXIARO and DUKORAL, and we see, especially for IXIARO, a double-digit year-on-year CAGR for at least next 3 years. We expect IXCHIQ sales to exceed €100 million in year 3 of launch, and this even assumes a competitive product entry.

We will stay focused and strategic with regards to our investments in R&D and our objective is clearly to provide our shareholders and everyone who can benefit from novel innovative vaccines with a new program to enter Phase III once Lyme has completed its Phase III. We see substantial gross margin improvement as we are focusing on proprietary sales.

The majority of our third-party product sales, especially the collaboration with BN...

Hello, can you hear me?

We expect gross margin improvement significantly, as I said, as we are focusing on proprietary sales. And we are improving substantially our manufacturing efficiency by leveraging our new facilities and predominantly the facility in Scotland, Almeida.

And as Peter mentioned, especially for chikungunya, but also for others, we expect sizable non-dilutive funding, helping us to finance CRE. When we look at the upcoming catalysts and news flow in the short term, on chikungunya, we expect to initiate a Phase III in immunocompromised individuals still in the first half of this year.

We talked in length about the upcoming potential approval by EMA, Health Canada, Anvisa. We will file for potential label extension as we generate more data and we have to reminder, we generated already data for the 12 to 18 year olds in Brazil, and we will initiate our Phase IV clinical program.

With regards to Lyme, as I mentioned earlier, on the VALOR side, we expect to complete the booster vaccination for Cohort 1 in the second quarter, then the initial 3-dose primary vaccination for the Cohort 2 as well in this -- in the first part of this year. And then, as Peter mentioned, we complete our financial contributions to Pfizer's Phase III trial costs in the first half of this year.

And then later this year, the Phase II year antibody persistence and put the results data, which will help us getting a better understanding about the necessity for potential annual boosters for this vaccine once implemented. With regards to additional news flow, we do expect a new U.S.

Department of Defense supply contracts in the second half of this year. And we will give more clarity on our R&D pipeline as we go along in 2024.

With that, I would like to hand back to the operator to take your questions.

Congratulations on the milestones achieved during 2023 as well as obviously the CHIK, I meant, its approval. Three questions, if I may.

Firstly, just in terms of getting back to the normal travelers market. In terms of revenues, DUKORAL pretty much back to where it was pre COVID, but still significantly below on IXIARO.

And I wondered how much further catch-up there is in volume terms for both products? Question one.

Secondly is just on -- in your kind of guidance overall, you talked about bringing another Phase III asset into development in the sort of midterm obviously, I assume that's not the Zika program, particularly given Moderna's recent announcement that they were halting development of that without further external sources of funding post Phase II. And then just wanted to know, finally, just on IXCHIQ, when do you think you will have durability data of 5 years or more?

Okay. Yes.

Max, very good question. So basically, you're absolutely right that we have not in all markets reach volume-wise, pre-COVID levels.

In some markets, we are back to pre-COVID volume levels in other markets, not yet. However, we expect to be back to -- back or better in terms of volume this year compared to pre-COVID.

And everything that we are seeing right now points in this direction. And this is specifically true for IXIARO, and IXIARO U.S.

And I think that's a very important point. When it comes to Phase III, we have intentionally not specified at this point in time, which program we will bring into Phase III.

We are looking at a number of internal opportunities, but also external opportunities, all just to avoid misunderstanding within our R&D budget. And so -- and this is why I said on the news flow, we will provide further clarity on the pipeline development in the latter part of this year.

When it comes to the antibody persistence data, we have the antibody persistence study for chikungunya is ongoing. We reported the 2-year data last September -- last December, sorry.

So obviously, this means that we're going to report a 3-year data this December, and the trial will continue up to 5 years. So which means every year, in December, we will report 1 year more in terms of persistence data.

I hope this answers your questions Max.

Congrats on the progress. I was going to ask one on IXCHIQ for exceeding €100 million for IXCHIQ by year 3 post launch.

Can you talk about the assumptions that goes into that? Can we assume that the €100 million is part of the €300 million to €400 million market opportunity for travelers as well as military.

And should we extrapolate growth trajectory based on these numbers?

[Audio Gap] Travel vaccines historically have shown an S curve in the ramp-up, right? So there is a -- this means you cannot just automatically extrapolate that because we expect the year 3 to be the first year of the period where it really goes steep up.

And what we have assumed here is indeed the, let's say, travel and military segment. We have excluded, for the time being, any potential stockpiling opportunity.

We have excluded any potential and meaningful sales in LMICs, and we have used in terms of modeling the IATA data, the experience that we have from IXIARO with regards to adoption rates in travelers and the most recent communicated price point for IXCHIQ in the United States. And on which basis we are also extrapolating the other price points and market opportunities in the travel segment.

I hope this answers your question.

Yes, definitely helpful. And Thomas, right at the beginning of your response, you broke out a little bit and it came back in when you mentioned S-curve for the military segment.

Can you repeat?

Let me just do it one more time. So I just said that all travel vaccines show from an uptick perspective in S-curve, and historically, and this will certainly be also true for IXCHIQ.

So we expect the year 3, which is why we have guided year 3 as the first year where we see this program going into the steeper curve or the steeper part of the S-curve. And the €100 million that we -- or the greater than €100 million include travel and military.

Got it. Okay.

Makes sense. And for that €100 million -- exceeding €100 million.

So that includes presumably a U.S. military contract in there.

Is there anything more you can say about that and just the progress in those communications with the military and when that could be announced?

Yes. So this is, of course, a good question.

So we are following approval and following recommendations. We have -- are now in active dialogue with the U.S.

military, but also with other public institutions and governments with regards to potential government contracts, which include potentially even stockpiles. So those discussions are ongoing.

But please keep in mind that we got the ACIP recommendation very, very recently. And also for IXIARO, it took a certain period after the ACIP recommendation before we got into the first contract.

And this is what we are currently assuming as well.

Got it. That's helpful.

And maybe one more question, just following the ACIP recommendation, maybe if you can talk about what your sales force is emphasizing for the -- as it relates to the IXCHIQ data with payers and providers and -- is it the strong data in subject 65 and up, I guess just what are some of the key points that you're emphasizing? And then how are you addressing the onset of immunogenicity?

So basically, the start from the very end of your series of different questions. So the product got approved by way of accelerated approval pathway like many other vaccines did, by the way.

So this means that the -- the immunogenicity level of seroprotective thresholds are predictive and considered predictive for efficacy. And we are, of course, emphasizing our very strong data here that we are close to 100% and that this includes elderly, where we see also a major differentiation against potential other vaccines that may enter.

And the second point is, of course, the unique setting that you have with a single chart a very, very long protection, and which, of course, means that this is an important feature when people think about chikungunya vaccination the travelers that go there are very, very often travelers who go multiple times. And there's a lot of IATA data that supports that.

And therefore, we emphasize this. And of course, we focus specifically the travelers 65 and above, but we promote according to what we are allowed to promote, meaning the label of the product as approved.

I just had 2. First, on the midterm outlook and some of the updated kicking on your market opportunity assumptions.

Seems like the total market is consistent with what you guys have said prior, while the share of travelers has increased at travelers. So can you help us walk us through some of the updated assumptions here.

Is that really driven by the ACIP recommendation, higher travel rates or initial reception [indiscernible] price? And then conversely, in terms of the reduced stockpiling or endemic opportunity?

And then secondly, as we're looking at the first year launch, now it will be a ramp in that you described. If you could help us understand any stockpiling or seasonality since we're still early on.

Yes. So a couple of different questions.

So first of all, market opportunity, as I said, we have taken a couple of key data points in the consideration. You have all seen the CDC maps that defined the areas where chikungunya and chikungunya transmission represents a major risk, it is the basis.

Then we use the IATA data with travelers going to this area, meaning the total population that we are targeting and focusing on we are also using, of course, market data from the acceptance or expected acceptance for the vaccine preliminary data show that especially the longevity of immune response and the high levels of protection are especially appreciated by potential customers and prescribers. And then, of course, we take adoption rates and those adoption rates are really educated also based on our own experience from the travel vaccine sector.

And all that together has led us to further fine-tuning the opportunity for the vaccine in the travel segment, as I mentioned earlier, and this is including, as I mentioned, the price point or the different price points in the different countries. Now what is important is we have not included any potential stockpiling opportunity at this point in time because we don't think that it's prudent to do that in the absence of really knowing whether there is a commercial opportunity around the stock product business.

We have not necessarily decreased the LMIC opportunity. We -- but we have not yet a clear feel for the LMIC opportunity, and we will further develop that.

So that's why we have focused our guidance right now on the travel segment.

So first, I just wanted to ask you about the third-party sales and moving to a proprietary platform. You had stated that this is going to improve gross margins.

But will there be any impact on your SG&A efforts?

Yes, Ed. This is Peter.

So the third-party business was really a way for us to bridge revenues during the COVID years. We have not really added -- I mean, we added a couple of people here and there, but really not significant numbers.

So the focus on our proprietary products will not have a dramatic impact on our SG&A cost. It's really gross margin improvement that will be driven by that because our proprietary products have already much better gross margin.

Okay. And my other question was just regarding potential strategic transactions.

You've mentioned it before. And I'm just wondering what is your strategy there?

Maybe give us your thoughts on what makes for a good acquisition or what makes for a good target?

Yes. So basically, we will target a next Phase III program, as I mentioned, at the time when the Pfizer Lyme Phase III trial will be completed.

And we have a couple of interesting internal programs we are currently working on that could be advanced and accelerated to match this time line and we've put it in direct competition to a couple of external opportunities that we are evaluating. When it comes to the criteria that we're going to use, we have, in the past, always focused our R&D pipeline development on trying to build vaccines and develop vaccine solutions in areas of unmet medical needs, and where we can have a differentiated position, first, best, only.

And basically, this is what we're going to do going forward. And as mentioned earlier as part of the news flow update, we hope to present a more detailed pipeline strategy in the latter part of this year.

Just coming back to the chikungunya program, if I could. On the Phase IV trial costs, how should we be thinking about the phasing of these costs?

And how significant are the non-dilutive contributions you're expecting towards those costs? And then second, if I may, on financing.

If we assume that there's no impact from potential business development deals in the near term. Should we assume that you won't be required to raise equity into at least post the potential launch in Lyme?

So let me start with the first part, and then I'll let Peter develop a little bit this cash outlook. So basically, when we look at the pipeline development, you are absolutely right.

So we are not expecting pipeline or any potential pipeline injection to negatively influence our cash runway that we have projected before. When it comes to the Phase IV activities for chikungunya, as part of our approval, and we have disclosed this earlier, those Phase IV programs go over a long period of time.

We have roughly 4 to 5 years to complete the 2 Phase IV studies. We have included this in our company deck, and it's still included, I think, in the company deck with regards to the time line.

So there is not necessarily an equal spread over the -- when it comes to spending, but it's many, many years of Phase IV spending. We have said earlier that we are expecting approximately 30% of our contributions to those costs.

And that's part of our planning going forward. Peter, on the cash runway discussion?

Yes. I think as Thomas alluded to, so we -- like we said were sufficiently financed for our operating business.

I think that repayment is a different story. And for this, I'm sure we will find a solution.

And so that's sufficiently financed for our operating business would include, as Thomas said, potential in injection, so we could still cover that. And so right now, we do not have any plans to raise further equity.

I think I've got 2 or 3, just kick off with IXIARO. You mentioned getting back to pre-COVID levels.

I think pre-COVID, IXIARO had a margin of nearly 70%. It seems quite a bit of a jump from the 52-odd that we've seen this year or 2023.

So perhaps maybe a bit of commentary on how you expect the margin to evolve in line of that growth? And then just on IXCHIQ, again, on margins, and I guess, price as well, we can see it's being listed at $350.

I'm just trying to work out what that would mean in terms of a net price to you guys, if you can help out either those, that would be great.

Do you want to take?

Yes, I can start with IXIARO. And hey, Samir, by the way.

So yes, you're right. So pre-COVID, I think the margins we had published were in the 60s.

And yes, I think close to 70%. And we do not see any reason why we would not get back towards this range again.

And then I think on IXCHIQ, it's public. So the wholesaler acquisition price is $275.

So that's basically what we get in the United States.

This is Klara on behalf of Suzanne van. So I was wondering what was the trigger to put out a midterm outlook?

And if you could confirm whether the midterm outlook is also including or excluding any potential milestones from Pfizer?

Yes. So basically, we have received a lot of feedback with regards to how we see the commercial business going especially for a new indication and a new product for which no benchmarks and no real data exist.

And therefore, we thought it is prudent to provide further clarity, point number one, on the let's say, the future of the commercial business and how we see the ramp-up in the launch years. The second part is, of course, we have received many questions around cash and cash necessities, given that we have clearly articulated that we would put on pipeline development in direct competition to potential external pipeline injection.

We wanted to make sure that people do not interpret this as external means financing needs or an imminent financing need. When it comes to the Lyme payments, the Lyme payments come at the point where we actually commercialize the vaccine or where Pfizer is going to commercialize the vaccine.

So -- and they will be part of when -- of the influx that we expect to -- the business to turn into sustained profitability.

Thank you so much for your time. Thank you for your support and the excellent questions today, and wish you a good remainder of the day.

All the best.