Good day, and thank you for standing by. Welcome to the Moderna First Quarter 2025 Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. Please be advised, today’s conference is being recorded. I would now like to hand the conference over to your speaker today, Lavina Talukdar, Head of Investor Relations at Moderna. Please go ahead.

Thank you, Kevin. Good morning, everyone, and thank you for joining us on today's call to discuss Moderna's first quarter 2025 financial results and business updates. You can access the press release issued this morning as well as the slides that we will be reviewing by going to the Investors section of our website. On today's call are Stephane Bancel, our Chief Executive Officer; Stephen Hoge, our President; and Jamey Mock, our Chief Financial Officer. Before we begin, please note that this conference call will include forward-looking statements made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Please see Slide 2 of the accompanying presentation and our SEC filings for important risk factors that could cause our actual performance and results to differ materially from those expressed or implied in these forward-looking statements. With that, I will now turn the call over to Stephane.

Thank you, Lavina. Good morning, or good afternoon everyone. Thank you for joining us today. I will start with a review of our business in Q1. Jamey will present our financial results and our outlook. Stephen will review our clinical programs and I will come back to some key priorities and catalysts before we take your questions. Let me start with a review of our financials. Our Q1 revenues were $0.1 billion, had a loss of $1 billion. These were in line with our expectations and reflect the highly seasonal nature of our respiratory vaccine business. We ended the quarter with $8.4 billion in cash and investments. As you are aware, we are focused on financial discipline. I'm pleased to announce that continued cost reduction efforts in the first quarter of 2025 led to a 19% reduction of cost of sales, R&D, SG&A combined compared to the first quarter of 2024. I would like to thank our team for great work. During the quarter, we made solid progress against our three priorities: priority number one, expanded markets for commercial products. Earlier this year, we were awarded a tender opportunity, allowing us to compete for COVID vaccine business in Europe. Additionally, during the quarter, mRESVIA received approvals in Australia, Taiwan, the UK, and most recently, in Switzerland. This is in addition to a program we received in 2024 in the US, EU, and Canada. Our second priority has a single pipeline to drive sales growth and diversification. I am excited to announce the expansion of our oncology portfolio with Checkpoint medicine, which Stephen will review later. For the Phase 3 flu program, we have exceeded the required number of case accruals to run an interim vaccine efficacy analysis. We also projected encouraging data from our key programs, including RSV, CMV, and INT at recent medical conferences. We are pleased to share INT will now be known by the high end of the international non-proprietary name of Intismeran autogene. This reflects the growing maturity of our product development program and marks an important milestone as we continue adapting towards potential regulatory approvals. Finally, on our third priority, executing with financial discipline. The first quarter of 2025 marks the third consecutive quarter we will reduce combined R&D and SG&A expenses by double digits year-over-year. With that, let me turn to Jamey.

Thanks, Stephane, and welcome, everyone. Today, I'll cover our first quarter financial results, our full-year outlook, and an updated operating cost framework as we look ahead to 2026 and 2027. Let's start with our first quarter financial results shown on Slide 7. Net product sales were $86 million, driven primarily by COVID vaccine sales. The US accounted for about a third of total sales with the remainder from international markets. This result was in line with expectations given the seasonal nature of respiratory vaccines, with most sales anticipated in the second half of the year. We observed lower vaccination rates compared to Q1 last year, reflecting the continued transition of COVID into routine seasonal vaccination patterns. In addition to product sales, we recorded $22 million of other revenue, bringing total revenue for the quarter to $108 million, a decrease of 35% year-over-year but in line with expectations. Cost of sales for the quarter was $90 million compared to the first quarter of 2024, where cost of sales decreased by $6 million, primarily due to lower sales volume. While total sales declined year-over-year, it represented 104% of net product sales this quarter, up from 58% in the prior year, driven by lower volume and revenue mix. R&D expenses were $856 million, a 19% decrease year-over-year. The decline was mainly driven by lower clinical development spend across our respiratory programs reflecting the timing of trial activity and the winding down of certain studies. This was partially offset by continued investment in our norovirus program and oncology. SG&A expenses were $212 million, down 23% year-over-year, driven by broad-based cost reductions. These reductions reflect our continued focus on streamlining operations and managing costs across the organization. We recognized an income tax provision of $7 million in the first quarter. Similar to the prior year, the provision was not material due to the continued valuation allowance on our global deferred tax assets, which limits our ability to recognize tax benefits from the loss. Net loss for the quarter was $1 billion, a $204 million improvement compared to a $1.2 billion loss in the first quarter of 2024. Loss per share was $2.52, an improvement from a loss of $3.07 in the prior year period. We ended the quarter with cash, cash equivalents, and investments totaling $8.4 billion, compared to $9.5 billion at the end of Q4. The decrease was primarily driven by the operating loss for the quarter. Now let's turn to our financial framework for 2025 on Slide 8. Our expectations for the full year 2025 remain unchanged from our initial guidance in February. We still expect total revenue in 2025 to be in the range of $1.5 billion to $2.5 billion with first half sales of approximately $0.2 billion, reflecting the seasonality of our respiratory vaccine business. As a reminder, the wide range of our guidance reflects the uncertainties in vaccination rates, the competitive market environment, the size of the RSV market, and the timing of licensure of our factories and product approvals in Australia, Canada, and the UK. As previously shared, while we filed three products with the FDA in 2024, since we don't know the timing of potential approvals, we are not including any new product revenue in our guidance range. Cost of sales is projected to be approximately $1.2 billion, reflecting continued improvements in manufacturing efficiency and lower expected inventory write-offs, offset by increased costs associated with the go-live of our new manufacturing sites in Australia, Canada, and the UK. I'll now provide some perspective on the newly introduced global tariffs, those in action as of today have not had a significant direct impact on Moderna. All of our drug substance for the US market is manufactured at our facilities in Massachusetts. Our commercial drug substance has been shipped overseas for fill/finish operations before shipment to the final customers. Internationally, our new plants in Australia, Canada, and the UK are expected to be outlined in 2025 to supply local markets. Finally, material sourced from China is not significant to our total cost base. R&D expenses are anticipated to be approximately $4.1 billion as we continue to invest in our late-stage pipeline while maintaining financial discipline. SG&A expenses are expected to be approximately $1.1 billion, reflecting a continued focus on efficiency while supporting our commercial execution. While we are pleased with the cost reductions that we achieved in both R&D and SG&A during the first quarter of 2025, it is still early in the year, and we are not updating our full-year expense guidance at this time. That being said, it is a strong start to the year, and we are looking to accelerate additional cost reductions in 2025. We expect taxes to be negligible in 2025, and capital expenditures are projected to be approximately $400 million. We still expect to end 2025 with approximately $6 billion in cash and investments. Beyond 2025, we are announcing today our plan to drive an additional $1.4 billion to $1.7 billion of cost reductions by 2027. As part of our commitment to achieve our 2028 breakeven target on a cash cost basis. To that end, we are reducing our 2026 GAAP operating expense forecast from $5.9 billion to a range of $5.4 billion to $5.7 billion. This guidance includes $0.9 billion of non-cash charges from stock-based compensation, depreciation, and amortization. Excluding these items, we now project a 2026 cash cost of approximately $4.7 billion at the midpoint of the range. We are also planning to reduce 2027 GAAP expenses to between $4.7 billion and $5 billion with a 2027 cash cost of approximately $4.2 billion at the midpoint of the range, excluding stock-based compensation, depreciation, and amortization. Stepping back from 2023 to 2027, we are planning a total reduction in annual GAAP expenses of over $6 billion, which represents a 55% reduction over four years from $11 billion annually in 2023 to $5 billion or less in 2027. The first $4 billion of GAAP expense reductions were realized in 2024, with the largest driver coming from reductions in our cost of sales when we undertook a strategic initiative in the second half of 2023 to restructure our manufacturing footprint to better optimize endemic-level demand of our COVID vaccine. We also reduced SG&A by 24% from 2023 to 2024, through a variety of cost-out initiatives throughout the company, and R&D declined 6% year-over-year to $4.5 billion in 2024. While we are continuing to drive additional cost reductions and efficiency gains in both cost of sales and SG&A, the largest future source of cost reductions will come from R&D, which currently represents nearly two-thirds of our expense base. This projected decline in R&D expense will come from the completion and wind down of our ongoing Phase 3 trials, procurement savings from contract renegotiations, and other process efficiencies. In summary, we are encouraged by the progress we've made in our cost-out initiatives to date. As Stephane mentioned, we now have had three consecutive quarters of double-digit year-over-year declines in combined R&D and SG&A expenses. Our teams continue to identify and act on new savings opportunities, which gives us the confidence in meeting our new 2026 and 2027 cost targets. With that, I will now turn the call over to Stephen.

Thank you, Jamey. Good morning or good afternoon, everyone. Today, I will review progress across our pipeline. Slide 11 is a review of our prioritized pipeline, which was introduced at our R&D Day last September. As you know, we have since filed for regulatory approvals for three of these programs: our next-generation COVID vaccine in mRNA-1283, our RSV vaccine for high-risk adults aged 18 to 59, mRNA-1345, and our flu plus COVID combination vaccine for individuals aged 50 and over, mRNA-1083. As part of our ongoing portfolio optimization, we've made a strategic decision to deprioritize the flu COVID combination vaccine for younger adults, those aged 18 to 49. While we remain committed to the long-term potential of combination respiratory vaccines, we will be focusing our efforts on combination vaccines in the older adult population for now. At the same time, we are excited to announce the advancement of our oncology pipeline with the addition of the Checkpoint program. The prioritization of this Phase 2 program is based on our early but encouraging data and is consistent with our strategy to build our therapeutics pipeline, particularly in oncology. We are targeting filings for Checkpoint and the other six programs on the right-hand side of this slide by 2028, subject to notes to data and regulatory consultations. Moving to slide 13, which outlines the latest development in our late-stage respiratory portfolio. As I just mentioned, we submitted regulatory filings late last year for three programs. Our next-gen COVID vaccine has a PDUFA date of May 31. The age group expansion for our RSV vaccine has a PDUFA date of June 12, and we look forward to decisions on both products in the coming months. For our flu COVID combination vaccine, we received a November 2025 PDUFA date. However, following feedback from the FDA during the review, the flu vaccine efficacy data will now be needed to support the application. As a result, we now expect the review timeline to be extended into 2026 and be dependent upon positive Phase 3 efficacy results from our ongoing flu vaccine trial and the addition of these data to the submission. On that point, our stand-alone flu vaccine candidate, mRNA-1010, is in its Phase 3 efficacy study. Due to the intensity of the current flu season, it has now exceeded the required number of cases to support the interim efficacy analysis, which we expect to complete by this summer. Now turning to our non-respiratory vaccine and rare disease portfolio. For our CMV vaccine, we recently presented durability data from our Phase 2 study at the SMID Conference, demonstrating that mRNA-1647 continues to elicit robust antibody responses for three years post-vaccination, showing very strong durability. We also had the opportunity to share these findings, along with an overview of our CMV program, at the inaugural CMV vaccines Work Group as part of the April ACIP meetings. We're encouraged by the establishment of this work group, which reflects the growing recognition of CMV as a significant public health concern and a commitment to reducing the disease burden of CMV. Our Phase 3 CMV efficacy study for mRNA-1647 continues to recruit cases. We remain blinded to the study results at this time and expect the final efficacy analysis to come later this year. For norovirus, we are pleased to note that the FDA clinical hold for our Phase 3 trial was lifted during the quarter. The study is fully enrolled in the Northern Hemisphere, and we are continuing to enroll in the Southern Hemisphere. The Phase 3 FC readout for norovirus is dependent upon case accruals. Given the uncertainty of that timing, the targeted approval could be in 2026 or 2027, depending upon that readout. We expect to have more clarity on the pace of case accrual and potential readout timing later this year. In rare diseases, our probiotic acidemia, or PA program is currently in a registrational study. We've made good progress with regulators and with enrollment. Following review of program timeline and other aspects of the launch, we now anticipate a 2027 approval. Similarly, for methylmalonic acidemia or MMA, we've finalized the registrational study design with the FDA, and we plan to initiate that trial in 2025. We expect the potential for approval for MMA in 2028. We continue to advance our oncology portfolio with significant progress across our individualized neoantigen therapy program, intismarin, our Checkpoint program, and our early-stage oncology programs. In collaboration with Merck, we have several late-stage studies underway for intismarin. As a reminder, the Phase 3 trial in adjuvant melanoma is now fully enrolled. We also have two Phase 3 studies in non-small cell lung cancer, both evaluating intismarin in combination with KEYTRUDA in patients with and without prior neoadjuvant treatment. Additionally, we're conducting randomized Phase 2 trials in adjuvant high-risk muscle-invasive bladder cancer and adjuvant renal cell carcinoma. I'm happy to announce that the Phase 2 adjuvant renal cell carcinoma study is now also fully enrolled. We're also expanding the scope of our intismarin program into earlier stages of disease, with the addition of a new Phase 2 study that moves beyond the adjuvant setting. This study evaluates intismarin as monotherapy or in combination with BCG, the standard of care in high-risk non-muscle invasive bladder cancer, and will help us explore intismarin's potential in earlier disease settings beyond the adjuvant landscape. As I mentioned a moment ago, we have prioritized the advancement of our Checkpoint program based on encouraging early clinical results. The program is currently being evaluated in a Phase 2 study for both first-line metastatic melanoma and first-line metastatic non-small cell lung cancer. I'll review the details of that program on the next slide. We're also advancing two novel cancer antigen therapies to the clinic. mRNA-4106 is a tumor-targeted antigen therapy designed to direct the immune system against multiple shared tumor antigens. The first patient has been dosed in a Phase 1 study in solid tumors that is assessing safety, pharmacodynamics, immunogenicity, and preliminary efficacy for the program. We have an open IND for mRNA-4203, which is designed to boost the activity of an engineered T-cell therapy to improve its persistence and effectiveness. This program is being developed in collaboration with Dematic. These cancer antigen therapies, Checkpoint, mRNA-4106, and mRNA-4203 are off-the-shelf therapies, in contrast with intismarin, which is an individualized cancer treatment. These programs reflect our growing oncology pipeline, with more coming soon. Let me provide an overview of the Checkpoint program, mRNA-4359, starting with its mechanism of action. Checkpoint is designed to help a patient's immune system recognize and attack tumor cells by encoding mRNA-based cancer antigens for PD-L1 and IDO. The therapy trains the immune system to recognize upregulation of PD-L1 and IDO by cancer cells and immunosuppressive regulatory T-cells. By combining this targeted immune activation therapy with checkpoint inhibition with traditional antibodies such as KEYTRUDA, we aim to enhance the anti-tumor response, overcoming immune evasion and improving the depth and durability of responses. Checkpoint is being evaluated in a Phase 1/2 clinical study, which is now moving forward and enrolling the Phase 2 portion. This study is designed to assess the safety and tolerability of Checkpoint, both as a monotherapy and in combination with KEYTRUDA in first-line metastatic non-small cell lung cancer and first-line metastatic melanoma. Key efficacy endpoints will include Objective Response Rate, Disease Control Rate, Duration of Response, and Progression-Free Survival. It is an open-label study. In addition to clinical outcomes, we are evaluating T-cell profile changes, both in peripheral blood and within the tumor microenvironment, to better understand mRNA-4359’s mechanism of action. We shared early Phase 1a data at the ESMO Medical Congress in late 2024, and we look forward to sharing data from the Phase 1b portion of the study at a medical conference later this year. Based on the early encouraging results, we plan to expand Checkpoint into multiple additional cancer indications. With that review, I will now hand it over to Stephan.

Thank you, Stephen and Jamey. We are focused on three strategic priorities: Priority one, to drive sales of approved products; Priority two, to focus on our late-stage pipeline to drive sales growth and diversification; Priority three, to deliver cost efficiency across the entire business. Our first priority is to drive the use of Spikevax and mRESVIA vaccines. We enter 2025 with two approved products, which gives us a better competitive positioning compared to the beginning of 2024. With our ability to now offer RSV for a full season, we expect to better compete in the respiratory vaccine market. In addition, recent mRESVIA approvals should add to sales this year. Priority two. We are focused on delivering up to 10 product approvals, which we believe will drive sales growth. Together, these 10 anticipated products target a total addressable market of over $30 billion. As Ivan discussed earlier, we have taken some of our priority programs. For the combination of Flu plus COVID in ages 50 and older, we expect the additional immunogenicity data coming soon for compiling, which will extend the review and approval timeline to 2026. For Norovirus, the grant timing is dependent on case accrual, which will mean the potential 2026 or 2027 approval. We are very pleased with the addition of Checkpoint AMC to our new prototype pipeline, mRNA-4359. Finally, for PA and MMA, we had seat approvals in 2027 and 2028, respectively. Priority 3, drive cost efficiency across the entire business. We've demonstrated our commitment to cost discipline through reductions achieved in 2024 and 2025 to date. We remain confident in our ability to further streamline our operating structure for the remainder of 2025 through 2027. We are pleased to announce today the 2027 cash cost target of $4.2 billion, giving us additional confidence in achieving our cash breakeven target in 2025. For 10 product test programs, we expect important milestones. We filed for approval for three products in 2024, including next-gen COVID among the 23 or IV vaccine for high-risk 18 to 59-year-olds. We look forward to regulatory decisions on this. For flu plus COVID combination vaccines, we expect an extended review timeline, pending positive standalone flu efficacy data and submission. We are targeting a 2026 approval. For CMV, we look forward to having the final results of our Phase 3 vaccine efficacy study in 2025. We have exceeded the case accrual goals for the flu efficacy study and expect a readout by this summer. Our norovirus vaccine is in Phase 3 and the timing of our data will be subject to case accrual. In oncology, the return of our ongoing intismarin Phase 3 adjuvant melanoma trial will be subject to event accruals and we expect to present our Phase 2 failure durability data in adjuvant melanoma next year. As mentioned before, we are very excited by the addition of the Checkpoint AMT team productized portfolio, and we look forward to sharing data at a medical meeting later this year. For PA, we are already generating data for a restructuring study, and we expect to start a restructuring study for MMA this year. I am very thankful to our team for the progress achieved so far across the commercial organization, our late-stage pipeline, and great cost reduction efforts across the company. With this, we'll be happy to take your questions.

Thank you. Our first question comes from Salveen Richter with Goldman Sachs. Your line is open.

Thank you. Good morning. You mentioned that due to FDA feedback regarding the need for Phase 3 Flu efficacy data, you now anticipate a longer review timeline and are aiming for approval in 2026. Could you provide more details about your interactions with the FDA and the reasoning behind their decision? Additionally, could you discuss the potential risks for the vaccine business outlook under the new administration? Thank you.

Thank you, Salveen, for the question. So, first, on the narrow question of the flu study. We have moved forward very quickly in enrolling cases as the FDA and everybody is now aware, and actually in that flu efficacy study, which we originally thought might be a two-season efficacy study, we now know that very shortly here, we will have a readout with a very large number of cases in a 40,000-person study. Since that flu component will speak to the potential value of our flu component, it makes good scientific sense that that would be a part of the review that's going on for our flu COVID combination. I'll remind you, we had already demonstrated efficacy for the COVID component. Now we're almost sitting on top of that flu vaccine component. So for a whole bunch of, I think, quite reasonable scientific reasons, it makes sense that we review that as a part of the combination vaccine study. The implication of that is we'll have to complete that review, and hope to see a positive result and then submit it to the current BLA for the mRNA-1083 program, which will inevitably lead to some form of clock stop and extension of the review timelines. We're excited to see those results in flu. We hope they will be constructive for the flu COVID program and look forward to sharing those results first and then submitting them once we have them. As far as more broadly, in terms of our interactions with the FDA across multiple submissions, those continue as business as usual from our side. We continue to have productive exchanges across all of our ongoing final reviews. That includes our 1283 program, the RSV program. We continue to be engaged in anticipating seasonal program composition updates for this coming fall. Obviously, I've just spoken to what's happening in the flu COVID combination space. From our perspective, we are grateful for the ongoing collaboration work, and we'll continue to make sure that we provide all the data required to conduct a diligent review of all of our products in our portfolio. Broadly, I guess the question regarding outlook, and I invite others to sort of add if I miss anything, but we continue to see a real need for COVID vaccination, particularly this coming fall. We'll remind you that through this winter season, we still saw thousands of deaths in the United States—actually, about 1,000 deaths a week during the peak winter months from COVID-19. The overwhelming majority of which were from folks who had not been vaccinated, but were older Americans with risk factors. We do believe that vaccines have a unique opportunity to prevent those deaths and hospitalizations. A publication from Denmark just this week shows that this past year, our updated vaccine composition was 96% effective at preventing death and 85% effective at preventing hospitalization this year. We believe there is a need, and we believe there's an opportunity for vaccines to play an important role in public health. Ultimately, people need to make their own decisions about that. So our focus right now is making sure that our products are available for Americans and markets around the world for the coming fall cold season.

Thank you. One moment for our next question. Our next question comes from Eliana Merle with UBS. Your line is open.

This is Jasmine on behalf of Eliana. Thanks so much for taking our question. Certainly on your thinking, whether it's seen INT Phase 3 data in 2026 is still a reasonable expectation. I'm wondering what your plans are for new trials, expansions, and other indications for both INT and the newly prioritized Checkpoint? Thank you.

Sure. Thank you for the question. I'll remind you that the Phase 3 melanoma study reached its target enrollment in September of 2024. Last year, we announced that. Given the historical event rates, we would expect that we would have accrued enough events for at least the first analysis of efficacy in 2026. We still believe the 2026 readout is possible, but it's not guaranteed. For other indications, we haven't provided updates on the non-small cell lung cancer study, but we're really pleased with that enrollment. We haven't provided a specific update on the timeline there. For the Phase 2 studies, we've now fully enrolled the randomized study in renal cell carcinoma, which is exciting because that randomized study has a chance of a readout. We have not, with our partner, decided when we expect that will be, but note that events accrue relatively quickly in that indication and population. So, we look forward to that. We will continue to look to expand perhaps into monotherapy spaces; both ourselves and Merck have indicated that, and we have an instance of that that we're bringing forward today. There will hopefully be others, but I will defer commenting on them until we and Merck are ready to announce that we've started those efforts. Regarding Checkpoint, we are obviously encouraged. We would like to share the data that's the basis of that encouragement at an upcoming medical meeting because we've been looking at that program very carefully in its Phase 1b portion of the study, which, remind you, is a combination with antibody checkpoints to see whether we can observe a synergistic effect. We're currently moving forward with at least two histologies that we discussed today. So, first-line non-small cell cancer in first-line metastases indication. We've been looking at it in second-line indications as part of that Phase 1 program as well. We will continue to do so. We will add additional histologies in the future, but we're not ready to announce any today.

One moment for the next question. Our next question comes from Tyler Van Buren with TD Cowen. Your line is open.

Hi, guys. Thanks very much for the update. Just at the risk of being repetitive here, and just to be clear, more specifics, given how close we are to the PDUFA, it's business as usual for the 1283 review. Can you talk about just how interactions are going for that program and what your confidence is in approval given the new leadership and the recent denial of the Novavax program?

Yes. I mean, obviously, I can't comment on other programs because I'm not familiar with what's going on there, but in those confidential exchanges. But I can speak to ours, which has really been business as usual. There are lots of exchanges of scientific information. We view it as our responsibility to provide high-quality data to all of our regulators, including the FDA so that they can conduct their assessments. To date, those assessments have, we believe, been constructive and positive. We have seen no sign that we're in any question about our ability to meet the existing PDUFA date. Again, review is ongoing, and we have to defer to what questions may come from the FDA or others as we move forward, but it really has felt like business as usual.

Thank you. One moment for the next question. Our next question comes from Michael Yee with Jefferies. Your line is open.

Hi. Thanks. This is Diana on for Mike. Just a quick question about a recent media article that came out yesterday regarding how vaccine trials would be run that they would now require to be run against a placebo. Just wanted to get your thoughts about that. What do you think that will do to enrollment? Will it be harder to enroll or easier—and is that going to be required, do you think, for all respiratory vaccines, specifically those for COVID or just newer vaccines such as CMV or any others that you're working on in your product line? Thanks.

Thank you for the question. As for the policy change that either hasn't happened or that we haven't been communicated directly to us, I would note that our COVID vaccine, RSV vaccine, CMV vaccine and norovirus vaccine are all conducted as placebo-controlled studies. Many of the other products in our pipeline also have parts in their development that happen in placebo-controlled studies: usually earlier clinical development or in certain populations. For example, our COVID vaccine was studied in children in a placebo-controlled context. So it will depend upon ultimately what the FDA and HHS feel is appropriate and their guidance at a program-by-program level of what that will require. Our responsibility as a manufacturer and drug developer is to make sure we provide the data that regulators and public health officials feel they need, so they can stand behind our products. We will absolutely engage constructively to ensure we understand those needs and fulfill them.

Our next question comes from Terence Flynn with Morgan Stanley. Your line is open.

Good morning. This is Chris on for Terence. Just one quick question on the COVID strain selection. So, given the regulatory uncertainties, can you please elaborate on the process for the COVID strain selection moving forward? Thank you.

Sure. I will answer from a global perspective. In every instance, it is up to our regulators in now all of these countries to tell us as manufacturers what updates they may or may not want for the coming year. Some years, flu does not update all of its strains for sure. So far with COVID, we have seen updates every year. There are continuously evolving strains that we are tracking that we think might justify an update this year, but that decision rests with a set of regulatory bodies. We will probably await timing here from WHO, EMA, and other international regulators. We would expect to also hear from the US FDA within the next month. The process ultimately depends on how they choose to conduct their selection process concerning whether or not they want to do a strain update for this year and what the composition will be; I will defer to each of those individual regulators.

Thank you.

One moment for our next question. Our next question comes from Cory Kasimov with Evercore ISI. Your line is open.

Hi, good morning, guys. Thanks for taking the questions. I wanted to ask you about the flu COVID combination and the updated timing you have there. You may not know yet, but is it your expectation that you would need to refile that with the updated flu efficacy data? Or could you just submit that data as a—what would be considered a major amendment? In other words, potentially delaying this by just three months and enabling a potential FDA decision in early 2026 as opposed to later in the year? Thank you.

Thank you for the question. The short answer is we don't know; it will ultimately depend upon consultation with the FDA of what they would prefer the approach to be. It is totally appropriate to submit that data as an amendment to the BLA. It could also make sense to update more broadly the BLA submission with it, which could result in resubmission. We'll just proceed with whatever feels like the most pragmatic approach, which will ultimately be the one that the FDA guides us to do. I will say, absent that, there is much other information in the current file, including the performance of the COVID component, obviously, things on manufacturing, the broader immunogenicity, and safety data set from the pivotal Phase 3 for the flu COVID combo. The review of all that information is progressing. There are reasons why amending with the flu efficacy data may be the most pragmatic approach. But again, it will depend upon consultations with the FDA, which will only be appropriate to do after we have that flu efficacy data in hand.

One moment for our next question. Our next question comes from Courtney Breen with Bernstein. Your line is open.

Hi, thanks for the question today. The main focus for us is really on kind of some of the new cost-cutting that you guys have announced today. What we would really like to understand is what particular milestones or expectation changes drove you to increase the cost-cutting program. I think you've been quite explicit in the past that you'll be looking for top-line signals to drive new changes there? And then kind of the second question is what components would you point to as being those where you've felt you've been able to flex to enable some of that cost-cutting that we're now into additional cost-cutting that we're now anticipating in 2026 and 2027 from last expectations? Thank you.

Yes. Thanks for the question, Courtney. As to the first piece in terms of what are the milestones or what's changed. A lot of this is that nothing has changed. We were expecting and we've indicated that we are going through a lot of Phase 3 large Phase 3 trials in RSV, CMV, norovirus, our combination vaccine, flu, and many of those just ramped down and are completed by 2027. We had never really given guidance for 2027. So much of this was just extending our guidance out a year and indicating just what that R&D level will be. The second thing is, as to a milestone, yes, it's an uncertain environment. So there's nothing from a revenue perspective that we've seen that would indicate that we need to do this, but we need to focus on what we can control, and that is our cost base. Looking out to 2027 and 2028, we felt that it was appropriate to get our cash cost to about $4 billion to ensure we fulfill our commitment to breakeven by 2028. Now, as to how, I already mentioned the large majority of it, which is the Phase 3 trials. But we have been on a cost efficiency program for the last couple of years, as I mentioned in my prepared remarks. There’s much to do, and the teams continue to identify additional opportunities in procurement. We're using digital tools or relooking at how we get work done. We think there’s a lot that we can do, and that’s why we came out with new 2027 guidance. Much of this is as expected, but some of it reflects the continued improvements that our teams see. We look forward to executing on and fulfilling our commitment to breakeven by 2028.

Thank you. One moment for our next question. Our next question comes from Myles Minter with William Blair. Your line is open.

It's Dick on for Myles. Thank you so much for taking our question. First, for norovirus, have you guys identified the source of the GBS case that was originally identified by the FDA? And have there been any additional cases of GBS noted in the Northern Hemisphere or Southern Hemisphere trials? And then second, for intismarin, for the study in which you quantified the number of T cell clones induced, we're curious how you're comparing that to the BioNTech product and whether you used the same analysis pipeline that they've used for their quantification for your sequencing data? Thank you.

Thanks for both questions. Yes, we're pleased that the clinical hold has been lifted. It means we've satisfied any of the questions and importantly, updated materials from an informed consent perspective are now out there. We have not seen an additional GBS case; that’s encouraging, but not necessarily unexpected. Unfortunately, it is rare when it does occur. It is part of the background population in older adults that happens fairly regularly, and we see occasional cases even in our placebo arms of these studies. Now we've seen one in the active group. It's possible that it's vaccine-related, and it's possible that it's not. We are working hard to assess causality, but you can't get a direct link. You can characterize frequency and make sure that people are aware of them. As part of our ongoing Phase III norovirus study, we will continue to actively monitor for additional cases of GBS; we certainly hope to not see any either on the placebo or active arms. All of that considered, we are quite encouraged to be off clinical hold and moving forward with enrollment and hopefully progressing with that program. On the intismarin question, I can't speak to the way BioNTech runs their pipelines as we're not deeply familiar with it. We're quite encouraged by the clonality we're observing in TCRs. I think it provides evidence that we're deepening and broadening the response related to our vaccine, supporting the exciting evidence of efficacy we've seen from that study. This offers some additional insights into the remarkable hazard ratio improvement we’ve reported both at ASCO last year and that we'll look to be updating as we continue to follow that Phase IIb study.

One moment for our next question. Our next question comes from Gena Wang with Barclays. Your line is open.

Thank you for taking my questions. I have two quick questions. One is when we look at the COVID revenue this quarter, the US was only $29 million and seems only a fraction of the Pfizer US revenue. So, any concerns about future market share change? The second question is regarding the flu vaccine interim data in Summer 2025. Could you please share your total events that you plan to achieve?

We looked at the Q1 revenue for ourselves and our competitors. All we can point everybody to is the actual script data. The script data through the first part of this year is really pretty similar to last year with 38% market share. Even if you go back to last year and normalize our revenue in the U.S. to reflect, we've discussed in the past, $1.7 billion, take out gross-to-net changes, it's really $1.5 billion, across that marketplace, representing 40% market share. That's exactly what we see, about 38% script data through the first half. I'd also say our customers are trying to manage their working capital better, so their inventory levels are down. I can’t comment on other companies' revenue, but I can comment on what we see in actual marketplace script perspectives.

And Gena, we didn't quite hear the second question. Could you just repeat it, please?

Sure. Of course. The second question is regarding the flu vaccine, the ACIP data in Summer 2025. I don't know if you would be able to share regarding the total events and the stats around it that you plan to achieve?

I don't think we've provided any guidance on that. Obviously, it is a very large number of cases since there’s been quite a large disease burden this year. But at this point, we will conduct that analysis when the season is over, and we'll try and share those results and ultimately explain them once we've released that.

Our next question comes from Geoff Meacham with Citigroup. Your line is open.

Hi, good morning. This is on for Geoff. I’m broadly thinking about the recent ACIP meeting and would like your insights on some of your comments, specifically regarding CMV, the need for durability data, and the challenges with its implementation. Additionally, for COVID, is there a possibility to shift from a universal recommendation to one based on risk? Separately, concerning the new checkpoint program and the cost cuts you're implementing, could you share any potential plans to out-license or partner this program in the future?

Sure. Thank you for those. On CMV, we do recognize for that vaccine, we will want to see good durability; five to ten years would be ideal if not longer. We are aiming to seroconvert people so they can control and prevent substantial infection with the virus. The durability data we have to date looks strong; through three years now, antibody titers and cell-mediated immunity are highly encouraging. We feel fairly confident that we will achieve our objectives for durable immune responses. Regarding COVID—again, it's for public health officials to decide how to use our products, and our responsibility is to bring that data forward. Our expectation is that those individuals over 65 or those with risk factors should get vaccinated. We remain encouraged that there is continued enthusiasm for vaccines. They still save lives, and our goal is to ensure they remain accessible. As far as the Checkpoint program is concerned, we’re excited about the emerging data; we’ll move forward and detail those at meetings later this year. We’ve prioritized our investment in oncology and reassigned some resources away from certain respiratory indications that we think may not bear as much results.

Just to add to Jamey's point, it's an important strategic consideration. Our respiratory franchise remains vital, but we see a tremendous immediate opportunity in our oncology portfolio. We have an established respiratory business that's generating cash flow. Rather than investing heavily in manufacturing or additional Phase III trials, we're focusing that capital to drive growth in therapeutics. We're able to pivot resources toward promising oncology programs based on the clinical data we are observing, and we believe that’s a significant growth opportunity for the company.

One moment for our next question. Our next question comes from Luca Issi with RBC CM. Your line is open.

Hey, guys. This is Shelby on for Luca. Thanks for taking our questions. Following up on the political landscape. RFK is on record arguing there is no evidence that a single antigen vaccine ever worked for respiratory diseases. He claims he is working on multi-antigen vaccines. Do you know what he means by that? And also, bigger picture, how confident are you that your upcoming PDUFA will be reviewed based on the risk-benefit profile of the molecules and not political agendas? Any thoughts much appreciated.

As far as the Secretary's statements, I think you'd have to refer to those questions to him. I can't comment because ultimately, it will depend upon his perspective. We do have products that have been approved that have demonstrated efficacy. We'll continue to provide data in support of that because we do believe that the clinical trials we run truly support the benefits of our products, including those that are single antigen. We also have numerous multi-antigen products and see merit in both approaches. Regarding our PDUFA date, we continue to have constructive exchanges of data and information with the FDA, as well as participating in reviews with the ACIP/CDC working groups that recommend these products. Our obligation is to ensure they have the information for a thorough risk-benefit analysis. We remain confident in the data we possess. The next-generation COVID vaccine is backed by a robust 11,000-person study demonstrating its efficacy, and we believe these indicators provide strong potential for addressing COVID-19. Most of our files include equally large Phase III studies and similarly significant data support. Our task is to present this information objectively, and we are optimistic our collaboration with the FDA will align with prior practices.

Thank you. Ladies and gentlemen, this does conclude the Q&A portion of today's conference. I'd like to turn the call back over to Stephane Bancel for any closing remarks.

Thank you so much for joining us today. As you can see, we are really focused on executing our strategy. Thank you for participating in the call. We look forward to speaking with you in the coming days or weeks. Thank you. Have a good day.

Ladies and gentlemen, this does conclude today's presentation. You may now disconnect, and have a wonderful day.