(BVNRY) Q2 2018 Earnings Conference Call Transcript

This post was originally published on this site
Logo of jester cap with thought bubble with words 'Fool Transcripts' below it

Image source: The Motley Fool.

Q2 2018 Earnings Conference Call
Aug. 16, 2018 8:00 a.m. ET


  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:

Rolf Sorensen

Yes. Good afternoon. My name is Rolf Sorensen, and with me I have our President and CEO Paul Chaplin. And before we begin, I would like to read the following: this presentation includes forward-looking statements that involve risks, uncertainties and other factors, many of which are outside of our control that could cause actual results to differ materially from the results discussed in the forward-looking statements.

Forward-looking statements include statements regarding our short-term objectives and opportunities, financial expectations for the full year and financial preparedness as of year end, as well as statements concerning our plans, objectives, goals, future events, etc. All such forward-looking statements are expressly qualified by these cautionary statements. We undertake no obligation to publicly update or revise forward-looking statements to reflect subsequent events or circumstances after the date made, except as required by law. And with this, I will hand it back to Paul.

Paul ChaplinPresident and Chief Executive Officer

Thanks, Rolf. And welcome, everyone, to our half-year update. We’ve had a very strong first six months of 2018, particularly with regard our growth strategy to expand our pipeline. As I’ll get to later in the presentation, we’ve reported strong clinical data from our RSV program.

We’ve initiated new studies. And today, as I’ll go into more detail, we’re highlighting new approaches that we’ll be bringing to the clinic into the immunotherapy. On the finances, we remain completely on track to meet our guidance by year end. The production of IMVAMUNE, which amounts to the bulk of our revenues, is on track.

Production is going well, and they will be seen in the– the revenues will be seen in the second half of this year. So, if we go to Slide 3 and talk about some of the recent highlights, one of the big highlights was reporting very successful results for our RSV Phase 2. We’re essentially the only company now that has reported a vaccine candidate generating broad immunity against the virus. And with these new data, we’re the only company that has demonstrated that the vaccine candidate will be an annual booster generating these broad and, hopefully, protective responses.

We’re broadening our immunotherapy strategy based on some exceptionally exciting results that we’re seeing out of our research labs in Munich. I’ll get more to that. But we’ve found that if we apply our vaccine platform, either directly into the tumor or intravenously, it’s much more potent way of stimulating T cells or other arms of immune response and has a great efficacy– greater efficacy in animal models.The CV301, we have or will be later this year initiating three Phase 2 studies. The first in colorectal has been initiated, and the next two will be initiated in the coming weeks and months.

And in line with that strategy to only look at the efficacy in combination with checkpoint inhibition in three indications, we will no longer be proceeding with the Phase 2 study in lung cancer.For Brachyury, we have received orphan drug designation from the FDA. And later this year, we’ll be initiating a pivotal Phase 2 study in a rare indication called chordoma. And we’ve strengthened our cash position with the recently announced loan facility from the European Investment Bank. This not only strengthens the cash, it gives us much greater flexibility to continue our investments in the infrastructure in terms of manufacturing, but also to take opportunities in the pipeline.Moving to Slide 4.

Our RSV vaccine, just to remind everyone, is completely differentiated from the competition and those who’ve gone before us. We are not targeting only generating antibodies as most of the competition. From our work, it’s clear that you need a much broader immune response kind of mimicking what a natural RSV infection induces. So, we’re looking to induce broad T cells antibodies and importantly mucosal immunity.

And for this, our vaccine includes five separate proteins from RSV. The data we’ve already presented supports the preclinical concept in that in the clinic a single boost of vaccination does boost these responses, and we see these broad antibodies, T cells, which have remained durable actually now for more– for longer than an RSV season. Moving forward, we are preparing to engage with the FDA to have discussions on the next steps for licensure. And in parallel, we continue to look at the feasibility of developing a more efficacious human challenge model, where we could evaluate the efficacy of our vaccine candidate before we go into Phase 3.

Slide 5, we just reported a booster data, and Slide 5 shows you the study design. The middle box is the design of the Phase 2, where we had five groups evaluating one or two vaccinations of a high or a low dose compared to placebo. And what we did last year was to reenroll essentially half the subjects from two groups, which received either a single vaccination of the low or the high dose. This allowed us to have the 12-month follow-up to see how durable the immune responses were.

And after which, we gave a second booster mimicking the annual booster regime, which we believe will be required. So, on Slide 6, to sum up the data that we’ve reported, surprisingly, actually the immune responses were durable out to 12 months. More than at least 60% of the subjects still had elevated antibody responses whether we’re talking about IgG, IgA in the blood or mucosal IgA from nasal swabs. We were able to rapidly boost these responses so to total antibodies against both RSV subtypes, including neutralizing antibodies, but also mucosal IgA from nasal swabs, which has from other publications being associated as a colorectal protection.

Regarding T cells, we also saw boost responses to all five RSV proteins. And as I’ll show you in the coming slides, these boost responses were strongest in those that had the weakest immune responses after a year, which is exactly what you want to achieve in an annual booster regime. And of course, these findings fully support the fact that our MVA RSV candidate will be an annual booster vaccine. And as I said in the introduction, I believe we’re the only company that has actually generated any clinical data supporting that concept.

If you go to Slide 7, this shows you the kinetics of one of the parameters, which is the serum antibodies against RSV. The main study, which is highlighted in red, was the main Phase 2 study where the subjects received either a low or a high dose of the booster vaccine at week zero. And these are the data that we’ve previously reported. If you look at the booster study, highlighted in green, at week 56 prior to the annual booster, you can see that these responses– these antibody responses in both groups remain elevated.

And yet, after the booster at week 56, these responses were rapidly boosted again really supporting, as I said, the annual booster concepts. This obviously is one parameter, but it is illustrative of all the other antibody parameters that we measured, which where it’s neutralizing antibodies against both of the subtypes a and b. It’s serum IgA or even mucosal IgA. So if you go to the next slide, Slide 8, what we’re trying to show here is that the boost responses that we saw was strongest in those that had a weaker immune response.

So, on the left-hand side, these are the fold increases in the various antibodies that we measured against RSV and they range from 1.3 to two-fold increases. And the reason these fold increases are lower than what we previously reported for the Phase 2 is that the antibody responses were higher prior to the boost after a year. And this can be seen, if you look at the right-hand side of the graph, because here we’re now comparing the boost responses after a year to the pre-vaccination levels at week zero the year before. So, this is prior to them receiving any booster with [Inaudible] RSV candidate.

And here, you can see that now we see the boost responses of 1.5 to three-fold higher to the boost levels prior to any vaccination, and this is clearly in line with the fold increases that we’ve previously reported for the Phase 2. If you go to Slide 9, Slide 9 is showing the mucosal IgA responses. And here, we’re looking at a median analysis. So we’re looking at those subjects who had a weak immune response, so those who were lower than the median, starting prior to the annual booster, which is the green.

And here you can see that we see a boost effect. Whereas those who had a strong starting immunity after one year, which is the red, those who are higher than the median value at the beginning, there really isn’t a boost effect. And that’s because these subjects already have a strong immune response and you can’t boost it further. Whereas those who had a waning immunity after a year, we can further increase that immunity back to what we presume are protective levels.

Go to Slide 10. Now we’re looking at the T cell responses. And again, we’re looking at the entire course of the study from week zero, where they received an initial booster, where as we’ve already reported, we saw strong boost to all five proteins included in the protein– in the vaccine, including to the whole virus. These responses, for the majority of the proteins included in the vaccine, remain durable up to week 56.

And again, you can see that we can boost them. If you look at the blue or the red line, which is the protein M2 or the G from the glycoprotein from subtype G, these actually dropped to the same levels as we saw at week zero, but you will note that the boost effect in these two is higher than in the others where the responses remain durable. So, to sum up in terms of the RSV data, we’re very excited. We couldn’t have asked for more than what we’re seeing.

We see good boost responses following the initial vaccination. One year later, these responses in the majority of the subjects remain durable. And those where the responses have waned, we are able to boost them significantly both in terms of antibodies, broad antibody responses in these broad T cell responses a year later. Now we are preparing to discuss the results– our clinical results with the FDA and our thoughts regarding the Phase 3 design, which will happen later this year.

And in parallel, we continue to look at the feasibility of developing a human RSV challenge model. Go to Slide 11. So, our immunotherapy strategy using our platform is based on our ability to use the platform to stimulate killer T cells recognizing tumor-associated antigens in the view that those T cells will kill the tumor, prolonging the survival or causing tumor shrinkage. We continue to follow this strategy.

I’ll come to in the futures slides, particularly in combination with checkpoint inhibition with CV301. But in parallel to our clinical activities, we’ve been working long and hard in research to try and find ways of making our platform more immunogenic and more efficacious in terms of our ability to use it to stimulate responses to kill tumors. And two findings that we have now found and some of which we’ve already published is if we vaccinate or inject the vaccine directly into the tumor or we deliver the vaccine intravenously, we found that both of these are much more potent at stimulating T cells and/or changing the inhibitory environment within the tumor, allowing a much better environment for allowing T-cell killing. And based on these findings, we now believe we’re at the stage where we want to enter the clinic and evaluate these two different approaches starting next year.

So, CV301 will be going into a Phase 1 study looking at the direct [Inaudible] tumoral vaccination. And Brachyury vaccine will be going into the Phase 1 study beginning of next year looking at the intravenous administration. And if you go to Slide 12, this is just a snapshot of a small part of the data that we’ve generated supporting these two concepts. On the left, you’re looking at a mouse tumor model that if we treat with placebo or PBS, the green line, the tumors grow and they kill the mice.

If we inject an MVA-based vaccine directly into the tumor three times as depicted by the dot– dash lines, you can see that we get a good control of tumor growth. And we don’t have– I don’t have that data today. But if we combine it with other things such as checkpoint inhibition, we can actually see curing of these animals. On the right-hand side, you’re looking at intravenous model, where, again, you’re looking at a tumor model in mice that remain untreated, the blue– the spotted blue line.

The tumors grow and kill the animals. If we just apply an MVA-based vaccine given IV, the green, there is some control– good control initially of the tumor growth. But after about 30 days, the inhibitory mechanisms that we keep talking about with the tumor take over and the tumors begin to grow. If you add an anti-PD-1, a checkpoint inhibition, it’s similar to the vaccine alone.

But if you combine the two, the red, so if you vaccinate IV and you combine it with an anti-PD-1, we get good control of tumor growth and the majority of the animals actually survive. So, we’re particularly excited about these data and we are eagerly awaiting the initiation of the clinical studies next year. So, if you go to Slide 13, as I said, we still believe there is strong scientific merit in looking at the application of cancer vaccines in combination with checkpoint inhibition. Our strategy for CV301 has always been to look at three different indications with potentially three different checkpoint inhibitors.

And that we’ll now achieve as we initiate all of the Phase 2 studies that are listed on this slide. So, the first study in red, the colorectal cancer indication has already been initiated, which is a combination of CV301 with nivo from BMS. Two other studies will be initiated in the coming weeks and months. The second will be a colorectal and pancreatic indication, using AstraZeneca’s durva antibody, which will be sponsored by Georgetown University.

And the third and last study, the bladder cancer study that we’ll be sponsoring in collaboration with Roche is TECENTRIQ. And this will be a two-stage design initially enrolling 26 patients, looking for initial responses, which if we see, we’ll enroll more subjects. In line with this strategy, we have decided not to proceed into the Phase 2 lung trial, as we now have three trials that will be initiated, which will allow rapid proof-of-concept of where we see CV301 in combination with checkpoint inhibition is efficacious in one or more of these indications. Slide 14, Brachyury, another cancer vaccine, which is currently in Phase 1.

As we round up that Phase 1 study, we are preparing to initiate a Phase 2 study in an orphan drug indication called chordoma, which is a rare cancer of the bones at the base of the skull and spine. This study potentially could lead to registration as currently there is no real treatment that is effective for chordoma patients. So, we’ll initially enroll 10 patients starting later this year. If we see an objective response in at least one subject, we’ll go on to enroll another 19, with a view that we actually want to see up to four patients responding, which we believe will be very compelling evidence of efficacy of the combination of our BN-Brachyury vaccine together with radiation.

Slide 15 outlines another Brachyury study that’s sponsored by the National Cancer Institute called QuEST or a Quick Efficacy Seeking Trial. The good thing about this is it’s a multi-company collaboration that’s sponsored by the NCI, where a number of different companies have agreed to combine their investigative drugs in combination with Brachyury. So, the base combination is always our vaccine and then it will be used in combination with a PD-L1 anti-TGF-beta fusion protein and/or an IL-15 super-agonist or an IDO inhibitor. So, this should actually generated a lot of exciting new data of the combination of our vaccine.

We have a number of other investigated products in many– with castration-resistant prostate cancer. Slide 16. Janssen, we have a broad collaboration with Janssen on four different indications. Our Ebola collaboration is in Phase 3, and we have three other indications, which we’ve licensed to Janssen and the HPV and HIV vaccine concepts, which are both therapeutic concepts will be entering Phase 1 later this year.

So, we’re making good clinical progress moving forward. And obviously, with this collaboration, there is still more than $1 billion worth of future milestones and payments in addition to royalty should we be successful with these approaches. Slide 17, our IMVAMUNE contract. As I said, our current manufacturing is on track.

But to just, again, remind you all of the recent award from last year, which is the single-largest IMVAMUNE order that we have in the history. So, it was more than $500 million contract, which was initially to produce more bulk in addition to the bulk we’ve already produced under past contracts. So, there was an initial $100 million bulk order, which as we said we would manufacture in 2018 and 2019. So, we will be revenue recognizing $50 million in each of those two years.

In parallel to producing the bulk, we are investing $75 million expanding our manufacturing facility to include our own fill/finish line capable of producing freeze-dried IMVAMUNE as well as other products. This line will come on board in 2020, whereby $300 million or $299 million of the award will be used to convert all the bulk from this contract and previous contracts into freeze-dried doses, which is approximately 13 million doses. And in parallel to that, there is $140 million that’s already been awarded, which is supporting the Phase 3 study, which we’ll be initiating later this year. Some manufacturing activities in transferring the process from our CMO in Germany to our new facility, which we will be seeing over the coming years.

And this is a 10-year contract. So just as our previous contracts started at $0.5 billion and ended up being $1 billion, this is starting at USD 0.5 billion, and we have agreed future pricing for bulk orders, for liquid-frozen doses, and also freeze-dried doses. So we believe the new contract that is in place will provide future revenue streams moving forward way beyond this initial order. In addition to our manufacturing activities, of course, we are also moving toward filing of BLA for our liquid-frozen indication.

We’re still on track to file later this year, which we hope will have a six-month review, meaning that we should see approval in the first half of 2019. And actually, I’m sure you’re all aware, we are eligible for a priority review voucher, which we could either keep to accelerate the approval of another product or sell in the open market. Slide 18 talks about the financials. As I said, we remain firmly on track to meet our guidance.

$350 million of the revenues that we’re guiding are associated with the production of our initial bulk order under the freeze-dried contract. As I’ve said, I think twice now, production remains firmly on track, and we are online to invoice in the second half of this year. The other revenues are all associated with existing R&D contract, so there are no risks in terms of waiting for new orders or new contracts. So we’re only guiding on the money that we know that we’ll be receiving.

And as I said at the beginning, we have improved our cash preparedness with the new EUR 30 million loan facility from EIB, which gives us added flexibility, not only to pursue investments in our infrastructure, but also to take up opportunities, new and exciting opportunities in our pipeline. Slide 19, the news to come. Well, as I said, we will be filing a BLA in the coming months for liquid frozen. We’ll be initiating the Phase 3, fully funded by the U.S.

government, first half of 2019. And we do anticipate the approval of IMVAMUNE with actually the award of a priority review voucher in 2019. Based on the reporting of our exciting RSV results, we’ll be meeting with the FDA to talk about the future Phase 3 design, while in parallel continue to look at the feasibility of developing this improved human challenge model. Our Janssen collaboration continues to progress with two new vaccines entering Phase 1, both for HPV and HIV, which are both therapeutic approaches.

On CV301, we’ll be initiating the two of the Phase 2 studies I outlined. We should be– we will be reporting Phase 1 data from our lung trial later this year. And obviously next year, we’ll be starting one of the new approaches looking at the [Inaudible] tumoral administration of CV301 in the Phase 1 study. Brachyury, we’ll be reporting Phase 1 results later this year.

We’ll be initiating our chordoma pivotal Phase 2 study later this year. And next year, we’ll be starting an intravenous Phase 1, again, another exciting new approach that we’re introducing into the pipeline. So with that, I conclude the presentation. And operator, I will open now to Q&A, please. 

Questions and Answers:


Thank you. [Operator instructions] We will now take our first question from Boris Peaker from Cowen. Please, go ahead. Your line is open.

Boris PeakerCowen and Company — Analyst

Good morning or I guess good afternoon where you are. My first question is on RSV. I’m just curious, how far do you plan to take this asset on your own?

Paul ChaplinPresident and Chief Executive Officer

Hi, Boris. So, we’ve said all along, we need a commercial partner for RHSV. It’s far too big a product– global product to imagine that we would have the capability to launch and market that ourselves. Right now, without having concluded any discussions with the FDA, it’s a little unclear how large the Phase 3 study will be.

I have never really commented on how large it would be. It really does depend on some of the endpoints and some of the statistical parameters that we need to agree with the FDA. So, we don’t know how large the Phase 3 is. I know there is a growing– there is a concern in the investor community about how would we fund the Phase 3 and would we go alone.

What I would say is that I’m never going to expose– overexpose the company to one asset. However, I don’t know what the Phase 3 design is and whether we can initially take that onboard, increasing the value of any partnership deal, or if the Phase 3 is large, which I think a lot of people– maybe not myself, but a lot of other people are anticipating, then clearly, I think we would need a partner prior to Phase 3. So I’m afraid the answer is it depends.

Boris PeakerCowen and Company — Analyst

Gotcha. And let me ask my last questions on the chordoma. You mentioned that nothing is approved, but I’m just curious what is the current standard of care and how long do these patients live from diagnosis, just to kind of use it as a basis of what your potential endpoints would be to get something approved.

Paul ChaplinPresident and Chief Executive Officer

Yes. So chordoma is a very slow-growing tumor. So I don’t have the number off the top of my head exactly how long–

Unidentified speaker

Less than 5%.

Paul ChaplinPresident and Chief Executive Officer

Less than 5%?

Unidentified speaker

5% less than–

Paul ChaplinPresident and Chief Executive Officer

Yes– no, but at the moment, the standard of care really is radiation therapy, where less than 5% really respond in terms of objective responses. And currently, there’s no real other treatment that is that effective. So, what we’re really looking for is objective responses. We’re looking at four objective responses out of 29, we believe would be extremely compelling in this setting.

And that is an ultra-rare orphan indication. Large studies are not practical or likely to be required.

Boris PeakerCowen and Company — Analyst

Gotcha. And just last question, I just wanted to squeeze one in. As you mentioned there’s over $1 billion of milestones from J&J. How much do you anticipate to receive that in the next 12 to 18 months?

Paul ChaplinPresident and Chief Executive Officer

So, we have received upfront payments. And what we have said is that the next milestone payments are associated with initiation of Phase 2. They’re not our programs, so I need to be very careful on announcing timelines of Janssen’s own programs. So, we haven’t guided on when we anticipate the timing of those, but the next milestones are associated with Phase 2.

Two programs are going into Phase 1 now, so that’s all I can really say on that.

Boris PeakerCowen and Company — Analyst

Great. Thank you very much for taking my questions.

Paul ChaplinPresident and Chief Executive Officer

No problem.


We will now take our next question from Peter Welford from Jefferies. Please, go ahead. Your line is open.

Peter WelfordJefferies & Company — Analyst

Hi. Yes, thanks for taking my questions. I’ve got three. Firstly, on RSV.

Just we’re curious there as to what you’re continuing to look at with the feasibility of the human challenge trial. There seems to have, I guess, been a lengthy discussion now. What exactly is the potential hurdle to get that trial started? Secondly then, some of the charts you showed on the booster study seemed to suggest that the serum IgG actually increased week 30 until the start of the booster study. I wonder whether that was replicated in any of the other parameters you looked at and what the rationale for that is.

Is it exposure to natural, I guess, RSV beginning again in the next season? Or what potentially [Inaudible] just variability potentially, given the relatively small sample sizes? And then just a financials one, were there any U.S. government IMVAMUNE revenues in 2Q? I presume there were. Could you perhaps just give us the magnitude and the amount that was actually sold to the U.S. government during 2Q? Thank you.

Paul ChaplinPresident and Chief Executive Officer

Yes. Thanks, Peter. So your first question was on RSV and the feasibility and what are we still doing. So, it’s not just discussions.

So, we’re working on the hypothesis that if we take a primary isolate of RSV, currently most people grow up RSV in vero cells. But what happens when you do that is that virus becomes attenuated and the mechanism which are in the literature and the like. We believe, together with our CRO, that we may have found a way that we could grow up RSV and retain its virulence. And what we’re currently doing, we have grown up the RSV, and what we’re currently doing is trying to characterize the RSV to determine whether we have retained the original virulence and if we’ve overcome the issue of growing it in vero cells where you lose virulence.

And why we keep saying we’re looking at the feasibility to make a decision, if we haven’t retained the virulence of the isolate, we won’t be going into a human challenge study because it won’t be any better than the existing human challenge study, which we’ve evaluated not to be useful to evaluate vaccine efficacy. And that decision should be made in the coming months. Your other question related to the potential increases in the RSV IgG from– in between from week 30, we see that, but actually after the fact that I think that’s probably the variation that we’re seeing with the assay and, as you say, the sample size where we’ve gone from half the number of subjects in the booster compared to the main study. So, we don’t believe that is a natural exposure or anything.

We probably think it’s most likely related to the variation of the assay. And then your last question was on the revenues. I don’t actually have a breakdown in front of me, but it’s minimal revenues actually for IMVAMUNE in Q2.

Peter WelfordJefferies & Company — Analyst

That’s great. Thank you.


[Operator instructions] The next question comes from Susanne Voorthuizen from Kempen. Please go ahead. Your line is open.

Suzanne VoorthuizenKempen — Analyst

Hi, good afternoon. I have a question regarding RSV. Can you give more color on the roughly two to threefold increases that you see in the IgG titles? And how this size into the often used rule of thumb to look at the fourfold increases? Have you gotten already confused on this from the outside from regulatory agencies or maybe from KOLs? And yes, what are the current thoughts or options that you see as potential next steps? And what would your considerations be?

Paul ChaplinPresident and Chief Executive Officer

Yes. So fourfold increases, the way you look at whether an increase is significant or not isn’t based on a particular numeric fold increase. It’s based on the variability of the assay, and you’re looking for normally twice the lower-limit increase. So, for lysis, the fourfold increase would be a very large increase.

For more variable assays, you often see fourfold. But in our assays and as supported by KOLs that have looked at the data and other partners, potential partners that are looking at the data, these are significant increases in serum antibodies. When you start looking at the mucosal responses, again, that’s why we always stratify it to show the weaker and the stronger immunity. We are seeing more marginal fold increases, but you do see those increases in those with weaker immunity, which is lending to a more convincing data that the increases we’re seeing are in– are real and significant in terms of what we’re allowed– what we can actually boost.

In terms of future considerations, as I said, we haven’t openly talked about what we believe Phase 3 requirements will be because we have our view and opinion. But until we actually discuss them with the FDA, I don’t see the point in doing that. But we have a number of different options that we wish to discuss with the FDA. So hopefully, during the second half of this month, we should get– second half of this year, we should get much greater clarity on what the Phase 3 requirements will be.

Suzanne VoorthuizenKempen — Analyst

Cool. Then we will stay put on that. Then I also have a few questions on CV301. Can you give some more color on the discontinuation in lung cancer? You mentioned the competitive landscape.

But have you seen any data so far that could also have tied into this decision? And then for the readout, what kind of data do you expect to report on? Will it be responses or also BFS and OS? And yes, what kind of data from this study would you see reading through to other indications?

Paul ChaplinPresident and Chief Executive Officer

Yes. So well, first of all, let’s answer the middle question. Have we seen any data that has driven the decision not to continue? So, no is the answer to that. At the moment, we’re in Phase 1.

We have, I believe, somewhere in the region of almost 10 subjects enrolled. So, it’s very few subjects that are actually enrolled and is primary looking at the safety of either CV301 alone or in combination with nivo, which was our initial start of the study over KEYTRUDA. So, it’s primarily a safety study. The sort of data that we will be reporting on is, obviously, safety immunogenicity.

In that CV301, as you know, we changed the platform from PROSTVAC. We reengineered the priming dose to be an MVA-based, which we give at very high dose levels to each limb. So, there are four vaccinations, one in two arms and the other in the two legs. And we do that four weeks apart.

So, we’re giving a lot more MVA or poxvirus than we did with PROSTVAC, and then we follow up with fowlpox boosters. So, there will be immunogenicity data, which will be important for CV301 as a platform. And then potentially, there are objective responses from the patients at the turn of the year. So, those are the real main drivers.

And I think the real read-through will be the immune responses. Are we actually stimulating good T cells to [Inaudible]. And then the real– so the main reason for not continuing into Phase 2, we said all along from 2014 that our strategy for CV301 was to look at three indications with checkpoint blockade. We are able to do that with three Phase 2 studies, one of which is initiated and the two that will be initiated in the coming weeks and months.

And so there was no real need to go into lung. The other issue with lung is the standard of care has changed essentially every three to six months since we’ve tried to start the trial. We’ve moved already from second line, where the initial approval was for nivo, to first line, and it’s clear, KEYTRUDA is probably now the drug of choice. But also, it’s a highly competitive indication, with a lot of competition for patients.

And we just saw that it would take a long time for the readout and then we believe we can get the proof-of-concept data we’re seeking from the three other studies. So that’s the main reason and driver for the decision, and it’s in line, as I keep saying, with the initial CV301 strategy.

Suzanne VoorthuizenKempen — Analyst

All right. Thanks a lot.


Our next question comes from Michael Novod from Nordea. Please, go ahead. Your line is open.

Michael NovodNordea Markets — Analyst

Thank you. It’s Michael from Nordea. A few questions. First of all, to the human challenge trial on RSV.

So you’re going into the end of Phase 2b with the FDA, but you don’t have these data. So, how crucial are they to the final design? And when you are able to finally initiate this trial? When you– how fast would you actually get some sort of indication and readout from this, supporting the plans for Phase 3? And secondly, on the chordoma trial with Brachyury. First of all, when is it possible to get the first signs of, say, impact or effect in Stage 1? And then to that, since you now moved on with an intravenous formulation of Brachyury, how will that potentially impact the plans for the chordoma trial? Would it make more sense then also to do an IV Brachyury in chordoma?

Paul ChaplinPresident and Chief Executive Officer

Yes. Thanks, Michael. So, I would say, regarding RSV, there are two tracks basically. One is we will have the discussion with the FDA on the assumption that we’re going to go into Phase 3 with no additional data than what we already have.

So, those are the discussions about what the endpoint could be, statistical assumptions which will affect, obviously, the total number of subjects and the like. In parallel, potentially, we will be doing a human challenge. We could have some initial human efficacy data for our vaccine at the turn of the year. If those things all turn out positive, i.e., we do develop this model, we do generate some efficacy data, you’re right, that would have an impact on the study design.

But that would allow us to go back to the FDA at that point, not only to talk about revising the study design based on new input and new potential efficacy data, but also to discuss the feasibility of potentially using a human challenge model as the main way of generating efficacy for the vaccine. So, there are multiple things that are potentially possible. But right now, our primary focus for the FDA is only to talk about the existing clinical data, and based on that, what would the design be. Hopefully, that answers your question.

And then you are asking about chordoma and when could we get some initial data readout. We’re looking for one objective– one patient to have an objective response. And of course, if it’s the 10th patient we enroll or if it’s first or second patient we enroll, we’ll have an impact. But I would say, next year, most likely, is our ambition that we would have a readout from that first round of 10 patients.

Regarding looking at the IV and will that impact, of course, every new concept is exciting as it may be. It has to go through the stages. So, we need to generate safety data in Phase 1 before we move forward. And as we’ve indicated it in the announcement today, we are moving forward with CV301 and Brachyury, looking at those two new approaches.

But it’s a way of generating some initial clinical data while actually we continue to work on what we believe could be better candidates coming through for those two approaches. Having said all that, of course, if we get amazing data with IV, we may adapt the design of ongoing or future studies.

Michael NovodNordea Markets — Analyst

Just one follow-up on RSV, if I may. It’s just from the outside, looking at this market, you’re saying that you definitely still need a commercial partner, and it seems like, at least from the outside, the clinical plans, they are perhaps taking a bit longer also now with, say, all the feasibility around the human challenge trial and all that. I’m fully aware that you’re not, say, necessarily willing to give this up to a big partner for, say– for all amounts that you could be offered. But on the other hand, wouldn’t it be a significant advantage for a company your size doing clinical trials in this area and you still want a commercial partner to get someone on board that has all the infrastructure to do this in, say, perhaps a bit faster fashion than you’re doing it? Or how do you– just to get a grasp on how you’re actually, say, judging the different scenarios in terms of not giving away too much value, but also you need to get to the market, speed it up.

It is still a competitive market. I know there’s nothing approved, but it still could be competitive. So to just get a sense of how you put these different parameters up against each other.

Paul ChaplinPresident and Chief Executive Officer

Well, they’re all important parameters. You’ve highlighted it. They’re all important parameters when you’re considering your various options. I would say, in terms of speed, in terms of where we are right now, if I was to license this program next week, even a big pharma would struggle to initiate Phase 3 for next year’s season.

There is a lot of things that need to be done. There is production. Your Phase 3 normally includes three lots, so there’s a lot of production activities. There’s a lot of discussions with the FDA.

You want to make sure your endpoint and your trial design is right so that even a big pharma would be struggling to get into the 2019 RSV season, which means that you probably, at this stage, are in the 2020 RSV season. I think it’s a very valid point that, obviously, there will be more financial clout to move things. They may not do a two-season study. They may do one big season.

But as I said, I think until I really know what that Phase 3 design is, it’s a big unknown right now. And it’s also a big unknown for partners that we’re actually in discussions with in terms of what is their risk and what is their future investment, when– everyone has a different opinion on what a Phase 3 looks like. And that’s why I really want to get that– those discussions over with this year. And I think that would put us in a much better position to decide what to do, but also help us in our partnering discussions.

Michael NovodNordea Markets — Analyst

Thank you.


There are no further questions from the phone. [Operator instructions] As there are no further questions, I will now turn the call back to your host for any additional or closing remarks.

Paul ChaplinPresident and Chief Executive Officer

So thanks, everyone, for joining the call and for the great questions and thank you very much. Have a great day.

Duration: 48 minutes

Call Participants:

Rolf Sorensen — Investor Relations

Paul Chaplin — President and Chief Executive Officer

Boris Peaker — Cowen and Company — Analyst

Peter Welford — Jefferies & Company — Analyst

Suzanne Voorthuizen — Kempen — Analyst

Michael Novod — Nordea Markets — Analyst

More BVNRY analysis

This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company’s SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability.

The Motley Fool has a disclosure policy.