Vaxcyte, Inc. (PCVX) September 2026 Conference Transcript

Thanks everyone for being here. I'm Yannan Zhu, one of the biotech analysts here at Wells Fargo. It is my very, very great pleasure to be joined by management team from Vaxite. With me on stage is Grant Pickering, CEO, and Andrew Guggenheim CFO. Grant and Andrew, thank you for being with us. Yeah, our pleasure. Thank you for inviting us. Great. So I know the company has important data coming up, but I was wondering to kick us off, could you give a brief overview of the company and its initiatives?

Yeah, so thank you all for coming. Delighted to be here. And if you don't know VaxCite, we are a vaccine platform company. We have a cell-free protein synthesis platform that allows us to do two key things that are out of reach of other technologies. So first, and what we're probably best known for, is the ability to perform site-specific conjugation, which allows us to create an opportunity to do one better than a really important class in the vaccine field, which are the conjugate vaccine class. And then in addition to that site-specific conjugation technology, we also have an opportunity to make difficult-to-make proteins that can be toxic to living host cells. But the way that we make proteins are in cells that have been extracted from the host. And so they can produce antigens of interest that you can't produce in a living host where most of the protein antigens for vaccines are produced. So we have been leveraging that technology since, well, over 10 years since we got the company started, and that has turned into a really robust pipeline led by our pneumococcal conjugate vaccine franchise, where we're leveraging that site-specific conjugation technology to sidestep the governor on the expansion of coverage for this class and so we're developing originally a 24 valent pneumococcal conjugate vaccine we've now graduated at least in the adult indication to a 31 valent pneumococcal conjugate vaccine and then the technology has allowed us to bring in another vaccine into the clinic which is a group a strep vaccine and so we're all vaccines all the time we're based in California and we're very excited about some upcoming clinical readouts that we'll have over the next year that we'll get into.

Got it, got it. I also wanted to ask you to share your thought at a high level on how investors should think about opportunities in the vaccine space in today's changing regulatory environment.

Yeah look I think you know from both a regulatory perspective from a policy perspective I think the direction of travel is constructive in relative to really most any time last year and we think vaccines continues to be well understood and recognized as an important public health tool from a regulatory perspective you know I think the direction of travel you know as an example Moderna and its flu vaccine from situation last year or refusal to accept a filing to recent approval I think it's an indication of the again positive more positive regulatory backdrop and from a policy perspective we continue to be engaged as a company at all levels of government, the executive branch, members of Congress, the federal agencies. There continues to be, you know, noise in the vaccines field, but in substance, we haven't seen material change. And importantly for us, given our lead programs, as Grant said, in the pneumococcal conjugate vaccine space, nothing but affirmation of the importance of pneumococcal conjugate vaccines, both in the adult and the infant populations.

Yeah, and I would just add, you know, it's one thing for anxiety around vaccines for diseases that have long been extinguished. You know, we have issues with this, obviously, in this moment with the resurgence of measles cases, but for a pathogen like pneumococci, this is a clear and present danger. People are being afflicted with community-acquired pneumonia, meningitis, invasive pneumococcal disease on a regular basis. These are omnipresent pathogens and so this is one of the reasons why the pneumococcal conjugate vaccine class has not been subject to the ongoing debate about certain vaccines in this moment. So on a relative basis we've felt insulated in light of the particular target that we've been mostly focused on to date.

And I would maybe just add at I think that confidence and opportunity in vaccines is reflected in some of what you see just in the broader strategic landscape. Over the last couple of years, you've seen AstraZeneca, Sanofi, and more recently Eli Lilly continue to make investments in acquiring vaccines business, which I think is a testament to the opportunity and the confidence, kind of notwithstanding kind of the change that at least historically has been afoot from a regulatory and policy perspective, the confidence, you know, in the continued opportunity in this field.

Got it, got it. Maybe just to follow up on that, let's talk about what is the unmet need for pneumococcal vaccine today, and how big is the opportunity?

Yeah, I mean, this is one of those classes that has been tremendously effective at preventing disease associated with the pneumococcal bacteria amongst us, but the problem has been that this particular bacteria, when you include, well, just to back up, pneumococci have about 100 different serotypes. So the outer coat of the bacteria can shift, and that has a discrete footprint that requires a specific antibody response to clear one serotype relative to another. And so what has happened was the very first generation in this class, there were seven serotypes that were circulating causing most of the disease. The very first version of the approved pneumococcal conjugate vaccines 25 years ago were able to incorporate those seven serotypes. And what happened was those seven serotypes were effectively taken out of circulation, which was a humongous breakthrough. The problem was that created a void in the upper respiratory tract for which the commensal bacteria is going to fill that void. And so the other serotypes of pneumococci filled in that void, and it creates a phenomena called serotype replacement. And that's what led to the need for Prevnar 13, eventually Prevnar 20. And if you stop vaccinating against those original serotypes, they begin to circulate again. So what has happened is you just need broader and broader versions of these vaccines to contain the bacteria. And the problem that we can solve with our technology is that as you add more and more of the conjugates that go after the discrete forms of the bacteria, they're using a common protein carrier that accumulates as you add more and more of the conjugates, and you begin to mount an immune response that skews toward the protein carrier and away from the protective immune responses against the bacteria. And that's a phenomena called carrier suppression. And our site-specific conjugation technology allows us to use that same protein carrier, same pneumococcal polysaccharides, but less of the protein carrier in ways that we can add more conjugates without adding a commensurate increase in the protein carrier to drive that carrier suppressive effect. And that has, you know, manifests itself in our ability to show with our 31-valent pneumococcal conjugate vaccine, not only broader coverage relative to today's standard of care, which has been a 20 or 21-valent vaccine, not only broader coverage, but also better immune responses when we compared ourselves to Prevnar 20, which is completely opposite of what has been the history to date, usually sacrifice broader coverage for lower immune responses. So that's kind of how it's all playing out.

Got it, got it. That's super helpful. Thank you. So the timing of the Phase 3 Opus 1 study was very recently narrowed to by the end of October. So that's obviously a very important event. So I guess we can take that the data will come during October rather than earlier, now October, given it's by the end of October. How much detail could we expect from that top line announcement? And can you give us a sense about the readout, especially around how the primary endpoint is structured and what a successful outcome would look like?

Yeah. I mean, technically the way that just last Thursday, we tightened up the window on the expected timing for the Opus 1 Phase 3 pivotal study that was just referred to. the way we wrote it was by the end of October. So there's technically a chance it could come in September, but it's going to come sometime between now and then. And the study is designed such that we'll be showing the same sort of evidence that has resulted in full approvals of the last two generations of pneumococcal conjugate vaccines. So what we're looking at is Vax31, which is our vaccine, compared to both of the current recommended standard of care vaccines. One is the 20-valent product from Pfizer. The other is the 21-valent product from Merck. And we're looking at a one to one to one ratio around 1,200 subjects in each of those three cohorts. And we'll be looking at the comparative OPA responses, which are the functional antibody responses, where you're actually confirming that the antibodies that are engendered by the vaccine actually clear the bacteria in an in vitro assay. And so what we need to show is non-inferior immune responses relative to the overlapping serotypes. And for those that aren't in either of the 20 or the 21 valent, we need to show superior immune responses, but that isn't very hard because you don't have a positive control. So what we have in this particular case is a unique scenario in this class. It's not usually been the case where you have two different vaccines that you want to compare yourself to. But the way that it played out prior to us was the first thing you should know is that the underlying technology that both Pfizer and Merck are using is the same. And so they each have the same limitations, which they've said themselves, they can't really put more than 20 or 21 conjugates using their chemistry into a single formulation. So you had Prevnar 7, where they added six more to get 13, and then they added seven more to get to Prevnar 20. So it has all of those original historically circulating serotypes still contained in the vaccine. But Merck had a strategy where they said, well, since those older original serotypes are largely under control, why don't we shift the 20 or 21 that we can get into a single formulation to pick up the serotypes that have not been addressed with a vaccine? And so we have two different vaccines with non-overlapping footprints. And so that's why we're comparing to both. So there are 11 serotypes that are in all three vaccines, and then there are nine that are only in Prevnar 20 and Vax31, and then eight that are only in Capvaxiv and in Vax31, and then there are a few more on top of it that are only in Vax31. So we'll be looking at the direct comparisons against both of the vaccines. We'll be looking at some of the overlapping serotypes, and then we'll be looking at those for which we only are comparing ourselves to a control feature. So the way this class has unfolded is no vaccine has ever been approved that hasn't had at least one inferior comparison to a standard of care vaccines. Sometimes it's as many as six. So perfection is not the requirement in this class. Each of the comparisons is its own standalone comparison, serotype by serotype. And what has been the case is even if you show that you exceed the non-inferior threshold, there's nothing to talk about. If you are technically inferior, it has been the case that for those misses historically, the takeaway has been they're still included in the vaccine because they have been at a sufficient titer that you exceed the minimum threshold for what would be considered to be a protective response. So the guidance that we have put out is that we expect to miss on one of the serotype comparisons when we look at the Prevnar 20 head-to-head. And then relative to Capvaxiv, which is the 21 valent for Merck that I was referring to, we expect to miss on as many as five. But when you have 10 or 11 serotypes more than each of those comparisons, we're talking about from a totality of the evidence perspective having a significantly better option if we meet that base case. But that base case also assumes that the robust immune responses that we saw in phase two with Vax31 would put us in a position to arbitrate for those misses to turn into included serotypes in the full 31 valent coverage spectrum.

And I'd just add to your question on our disclosure approach, which consistent with what we've done historically, we would expect to issue a teaser release the night before we would anticipate announcing the data and then the morning of issue a press release and conduct a conference call and share an investor presentation. In aggregate, pretty fulsome disclosure approach. I would say it's very much a biotech-like disclosure approach versus a pharma-like approach in which we'll share the data on the subject demographics, the safety and tolerability data. We expect to have the significant majority of the safety data when we disclose it. The timing of disclosure is really driven by the availability of the immune response data. And then you'll see pretty detailed immunogenicity data, as you've seen in our prior post releases, forest plots comparing Vax31, and in this case, as Grant said, to not only PCV20 but also PCV21. You'll see those based on the OPA data. We'll also likely show So it would be a pretty complete data set that I think will give investors a good perspective on, you know, the quality of the data. And in our view, a data set that we hope will reflect, you know, totality of the data that warrants, you know, FDA approval.

Great, great. So it sounds like the non-inferiority are compared at serotype by serotype level. So in that sense, how do you or FDA, you know, declare success of a study? What is that bar? How many do you need to meet non-inferiority versus, you know, can you share your thoughts?

Yeah, so, I mean, there's plenty of precedent in this class, having had five different versions of adult vaccines approved going back to 2010. And it is certainly the case that the totality of the evidence, as in what does the full coverage of your vaccine provide relative to the standard of care vaccines and what they provide, and that's what drives this, you know, consideration on, of course, they're going to look at safety, they're going to look at manufacturing consistency, and then they're going to look at the immunogenicity, which is going to be the surrogate for protection. And so, you know, it starts with the coverage of the circulating disease that our vaccine can confer relative to the circulating disease that the other standard of care vaccines can provide. So on the one hand, you have the 20-valent from Pfizer that provides around 60% of the circulating strains that cause disease are in that vaccine. Because Merck shifted the goalposts to orient toward those serotypes that are circulating today, their coverage goes up to more like 80% to 85% coverage. I think it's 82. They're not covering a lot of those serotypes that are currently held in check. Two of the serotypes that had been held in check have reemerged. So their coverage is better. Our coverage with Fax 31 goes all the way up to 95 percent. But we also have those older serotypes that have been under control, inclusive of the two that have begun to reemerge. And so we have an opportunity to have a significantly better totality of the evidence than either vaccine to date have been able to show. And then as it relates to if the data is not perfect and we have a number of misses, which we're setting as the base expectation, we believe that we'll be able to arbitrate, given the magnitude of the immune responses we've shown to date, to meet the satisfaction of the regulators the same way that each of the vaccines I just referenced with the missed that they had in each of their programs, they were able to arbitrate for its inclusion. And Prevnar 20 has had as many as six missed of non-inferiority comparisons in the infant indication and was able to arbitrate for all of their inclusion. So that's kind of how we expect it to play out, and we'll have the data by the end of October.

Great. Thanks for walking through with that detail. In a real world setting, when doctors and patients select their PCV vaccines, I was wondering, you know, because of all the nuances of different stereotypes and performance at each one, you know, are they, what is the guiding principle or that they go with, you know.

Yeah, so it's been very, very clear that coverage has been king in this class. And it's been the case in every instance thus far that the broader the coverage, the dominant market share follows. And, you know, that's for a number of reasons. Obviously, if you can get a single vaccination and be protected against more circulating disease than the alternative, why would you not go with the one that provides you more immediate protection. So it's been kind of a no-brainer historically, and we've seen this play out. I mean, the best example was when the 20-valent from Pfizer was competing against Merck's predecessor vaccine that had 15, even though the 20-valent was launched later, it ended up with 98% market share. And so it's partly because it's obvious you'd rather have broader protection. But then there's frankly also a little bit of a liability anxiety. Like if you were to choose a less broad spectrum vaccine and someone contracts disease from a serotype that they could have been protected against in an alternative, that creates a liability issue that no physician wants to expose themselves to. And there is actually case history where this has come to pass. So part of it is doing the right thing, but also making sure they don't do the wrong thing. That's kind of how it has played out historically. And I think we expect to see the benefit of that for all the right reasons.

Yeah, I mean, in the market, as to emphasize Grant's point, kind of relative immune responses has not been a feature, right? Sponsors don't point out the benefits of their immune responses relative to the competition, nor the flaws in immune responses of the other vaccines. It just has not been a feature. It's been driven almost entirely, as Grant said, by the spectrum of coverage. And so, which is why we when we think about kind of what's the data set we need to deliver, we often get asked the question, well, how would an approved vaccine with seven misses, four misses, one miss, how would that impact the commercial potential of your vaccine? And our view is it wouldn't, right? What an AN APPROVED VACCINE IS BY DEFINITION, AN APPROVED VACC-31 IS BY DEFINITION A BEST-IN-CLASS VACCINE. SO REALLY THE THRESHOLD FOR US IS LESS ABOUT THE RELATIVE IMMUNE PERFORMANCE. OBVIOUSLY THAT'S AN IMPORTANT FEATURE, BUT DO WE DELIVER A DATA PROFILE THAT IN AGGREGATE WARRANTS APPROVAL? AND OUR BELIEF IS IF APPROVED BY DEFINITION WE WOULD DELIVER THE BEST-IN-CLASS VACCINE BECAUSE WE OFFER SUBSTANTIALLY MORE COVERAGE INCLUSIVE OF THE HISTORICALLY CIRCULATING serotypes relative to the two standards of care today.

And part of that, the other dimension, and these short format discussions don't usually offer a lot of dimensionality to what's going on here. But the other thing that's been going on is while we talk about coverage having been king, always leading to major improvements or winning market share, that's in the context of the broader spectrum vaccine, usually having lower immune responses. So the average immune response for a Prevnar 20 conjugate is about 25% lower than a Prevnar 13 conjugate because of this carrier suppression phenomena. That didn't stop it from getting dominant market share because it had the coverage of a 20-valent vaccine. We've yet to run a head comparison against capaxiv. We're about to see the results of that in the OPUS1 study. But we have had a phase two head-to-head study relative to Prevnar 20. And for the first time ever, we compared our broader spectrum vaccine to a less broad spectrum vaccine. And we produced 25% higher on average immune responses, not the typical, which is usually broader coverage, but 25% lower immune responses. So the clinical data we have generated to date, we called it unprecedented at the time because no one had ever produced a result with a broader spectrum vaccine where we actually got better immune responses. So that's how we have the confidence that we have relative to what we expect to see relative to Prevnar 20. We just haven't had the luxury of having run a head-to-head relative to Capvaxiv. But as I said, we'll find out soon enough.

That's a great level of detail and insights, thanks for sharing. Maybe if I can build on what you were saying about PCV20 took over the market once it's introduced and out-compete PCV15 by many, many folds, right? Could we use that analogy and think about, could that be the dynamic of VAX-31 competing against PCV-21?

Well, that sounds good to me. But when we think about the dynamics, it's a different set of circumstances, right? So the coverage advantage that we're going to have is going to be quite meaningful relative to Prevnar 20, which isn't going to go away without a good alternative. But as we think about the comparison to Capvaxiv, which I think the launch was extremely impressive for that product, but things have slowed down. And now we're looking at a moment where, for the last couple quarters, we're really seeing an equilibrium that's established between both Prevnar 20 and Capvaxiv. And I don't think that's an accident. I mean, the difference here, and we touched on it earlier, but now we can get a little bit more specific, is two of the serotypes that are not in Capvaxiv but are in Prevnar 20 are actually circulating at a higher and higher rate. So it's serotypes 4 and 19F, and at the time Capvaxiv was considered by the ACIP a couple years ago, that was the reason why the ACIP only granted them a non-biased recommendation. They said, we're going to let each of these vaccines be recommended without bias, and we'll let the market decide, and that was an unusual moment because they did have the coverage advantage, but the reemergence of serotypes 4 and 19F were sufficiently concerning to the ACIP that they said, if we were to give a preferred recommendation, we would expect those serotypes to skyrocket in prevalence even more. And so if you look at the Capvaxiv label, it actually says that vaccine is not to be used in the Western United States, where serotype 4 is circulating aggressively. And since that conversation, the rates of disease driven by those two serotypes has only increased at an accelerating rate. So they made the right decision. So your question was, how do we expect things to play out relative to capaxiv? Well, if Prevnar 20 and capaxiv can reach a standoff with a 20-valent with 60% coverage and a 21-valent with 80% to 85% coverage, I would like to think that we have the benefit of better arguments on both sides of that argument. And so we would expect to have dominant market share with the kind of profile that we're anticipating with Vax31. But we're going to stop short of saying, you know, the precise expectations there. But we think it's going to be the dominant product in the class.

Great, great. Thanks for sharing that insight. So opus 2 and 3 are going to be read out read out first half next year. What are the purposes of these studies and how does that segue into BLA filing?

Yeah, so opus 1 is the pivotal cornerstone study for the filing and And then Opus 2 and Opus 3, I would call those complementary studies. So on the one hand, they're contributing incremental safety numbers to ensure that we have an adequate safety database at the time we file the BLA. But then they each confer other important features for decision makers. So in the case of Opus 2, this is a study where we look at Vax31 administered with seasonal flu vaccines, and you make sure that they can be administered conveniently together and not produce a situation where the benefit of giving someone two vaccines in one setting is offset by immunological interference with lower antibodies to the vaccine. Now, the reality is each of the marketed products today have run those studies. The immunological interference, it is there, but it's at a level where the decision makers, whether it's the FDA, the ACIP, the pharmacies, they don't believe that immunological interference is meaningful enough that they don't think it's a benefit to give a vaccination to individuals while they're there and presenting with an opportunity to be protected against both seasonal flu and pneumococcal disease. So you don't have to do any better than those guys. But if you look at the data that's available, the Kapvaxiv interference is greater than the interference seen with Prevnar 20. So I think our view is as long as we're in that zone of either of the two marketed vaccines, it'll just be a feature that decision makers will want to make sure that they can have the same sort of convenience that they have with the other products. So that's Opus 2. Opus 3 has a slightly more attractive feature to it, which is this is a situation where we're enrolling individuals who have been vaccinated already with a pneumococcal vaccine, inclusive of Prevnar 13, Prevnar 20, Capvaxiv. And this is where you're able to prove that you can give them a newer, broader spectrum vaccine, where the convention has you actually boost those overlapping serotypes while conferring expanded coverage with the newer serotypes. And this opens up the door for what is called a catch-up recommendation, where someone who has gotten PrebNAR13 in the past, they present to a caregiver, and they recognize there's an opportunity to expand the coverage of protection for that individual. And so we want to have that data to be able to provide to the decision-making bodies, whether it's ACIP or the New Vaccine Integrity Project and the AMA, to make sure that they know there's a benefit to giving this vaccine to folks who've been administered with inferior forms of the class vaccine in the past.

Got it, got it. And the timing of the BLA, have you guided for that?

Now, we have not, we've stopped short of formal, do you want to take this one?

Yeah, sure. Yeah, so just to, we have not given formal guidance with respect to the BLA. What we have said is, in addition to the Opus 1, Opus 2, and Opus 3 studies. The other study that would complete kind of the data set, if you will, to enable the BLA filing would be the manufacturing consistency study. We're engaging with the agency on that. We would expect to be in a position to commence that study in 2027. Those studies are quite quick to enroll because they're in much younger adult populations, and the timing of that will drive the ultimate submission of the BLA. But our hope is and our plan is to be in a position, and with BTD status, we'd expect accelerated approval to be in a position to target an approval by the end of 2028.

Got it. Very helpful. In the remainder of time, I was wondering if you could talk about the Group A strep vaccine. Give us a sense of the unmet need in this indication, your level of excitement and potential market size.

Yeah. So this is the second vaccine. Well, we have multiple generations of our pneumococcal conjugate vaccines, but the group A strep vaccine is called VaxA1. We're thrilled to have it in the clinic. It's in the midst of a two-stage phase one program at this moment. And this is a bacteria for which there is no vaccine available. This is an incredibly widespread problem from pharyngitis to necrotizing fasciitis, this is a bacteria that if not treated with antibiotics very early on leads to heart damage. There are 900,000 people every year that die from the sequelae associated with heart damage from group A strep. So it's an unchecked problem. And given the requirement and immediacy of antibiotic prescriptions, oftentimes this is something for which antibiotics are prescribed even before there's a definitive diagnosis. And so we're all acutely aware of antimicrobial resistance as a global problem. Well, group A strep is one of the biggest reasons for antibiotic prescriptions on the planet. So it does have really meaningful immediate effects for those afflicted from the lesser forms of the disease for which we spend $5 billion per annum in the U.S. with child care and dealing with the sort of strep throat effects all the way down to the much more serious cases. And so this is a vaccine that has an opportunity to address disease in the childhood theater, but then also has an opportunity to address invasive disease in older adults, which is one of the reasons that the pneumococcal class became so attractive is it's a vaccine that's given to both infants and adults. And so we have that same sort of opportunity with the group A strep vaccine. In fact, back 15 years ago, when adults were first recommended to get a pneumococcal conjugate vaccine, the amount of invasive disease caused by pneumococcus is less than the invasive disease caused by group A strep today. So we know that there's a demand feature for this vaccine. There just has not been a solution that's been available from industry. So we're really thrilled. We think we have a great vaccine. Obviously, there's greater risk because no one's blazed this trail before, but we're able to leverage the same site-specific a conjugation technology that I had talked about at the outset. But in this case, the protein carrier and the polysaccharide are both able to generate antibodies that can clear the bacterium. That's not the case with pneumococci. The protein carrier is just there to help the polysaccharide get processed by the T-cell compartment. Group A strep has a different physical chemical makeup for which you can get proteins that will bind to the surface of the bacteria as well as to the surface of the carbohydrate. So we have kind of two ways to win for this particular target. So we have a construct that has a protein carrier that's the business end of the vaccine, but also a carbohydrate feature that's the business end of the vaccine. And as opposed to pneumococcal vaccines where we've talked about you need seven different forms, 13, 20, 30. The carbohydrate that we have is a universal carbohydrate that's on every single serotype of group A strep. So it's a singular conjugate that has universal protective properties, which we've only confirmed pre-clinically, but it was compelling pre-clinically. And we think it'll translate to the human condition as well. And then there are a couple of other virulence factors that are in the vaccine that we think will help the immune system make way for the kind of response we need to clear the bacteria. So it's really exciting. It's a white space opportunity, but it's also a great business opportunity and could be a really compelling global solution as well.

Right, right. May I ask in terms of timing for that phase one data or from the ongoing phase one?

Yeah. So we've guided to having data in the second half of next year. And now that will be immunogenicity data. That will be initial safety data. But when you're blazing the trail with a vaccine, you know, we'll need to see adequate antibody responses that give us the confidence to run a phase three study. But frankly, we won't have the answer for sure until we run it in a clinical efficacy sort of outcome, which given the attack rates of this disease, like in everybody who has primary school age children, we're talking about an attack rate where 15 to 20 percent of children who go off to school contract this disease. So that makes it a manageable clinical experiment when you have an attack rate that high. I mean, that's six to seven times higher than the attack rate of RSV, for example, which we've successfully developed RSV vaccines. It was just a lot harder.

Great, great. I think that's all the time we have. Thank you, Grant, and thank you, Andrew, for a very, very informative session. Yeah, thanks, Yonah. Appreciate it.

Thanks, everyone.