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Most of our vaccine will go to middle and low income countries: Novavax CEO

Yahoo Finance’s Anjalee Khemlani is joined by Stanley Erck, Novavax CEO and the Yahoo Finance Live panel to discuss the news that Novax says that it’s COVID vaccine is 90% effective.

Video transcript

ZACK GUZMAN: Well, another vaccine has demonstrated its worthiness to be added to the global arsenal being used to fight the pandemic. This time, Novavax, saying its vaccine proved to be more than 90% effective against the virus in the nearly 30,000 person trial. It was also shown to be 100% effective at preventing moderate or severe disease. And for more on its path forward to getting into the arms of patients around the globe, happy to bring on the CEO and President of Novavax, Stanley Erck alongside Yahoo Finance's Anjalee Khemlani with us as well.

Mr. Erck, appreciate you taking the time here to chat. I mean, when we look at this, obviously here in the US, there's a bevy of vaccines here available to us. But when you look around the globe, where are you seeing the biggest impact that Novavax can have with this one from the get-go?

STANLEY ERCK: Yes, good question. So in the US-- so I ran the trial in the US, and what's interesting and what will be helpful globally is the fact that in this trial, although we got overall 90% efficacy-- and 82% of the people, they got sick from variants. And everybody's heard about variants and are worried about them. And since we ran the trial during the period in which variants were circulating, we were able to show efficacy against that. We got 93% efficacy against the variants-- of what they call variants of concern or variants of interest.

And in addition, the vaccine that's circulating that's more like the original Wuhan strain, we've got 100% efficacy. So a great place to start. And so what does it mean for us for global distribution? So we've taken the point of position over the last year that we want to get-- we want to get the vaccine out globally, and that includes more than just the US and Europe, but to low and middle income countries. And we've done that. We've performed a partnership a year ago with the Serum Institute of India, which is the largest vaccine manufacturer of the world.

They supply 65% of the children of the world vaccines and childhood vaccines. And so we partnered up with them because they know how to get vaccine into the-- what we call the 92 AMC countries, which are the middle and low income countries. And so between us, we have pledged 1.1 billion doses of vaccine that will go to what's called the COVAX facility. That's the facility that the US government just announced that they were giving a billion doses to.

So we will supply them 1.1 billion doses. So most of our vaccine will go to low and middle income countries, which are desperately needed there. And then on top of that, we have advanced purchase orders from high income countries, and a couple of hundred million doses will get to those as well starting in the fourth quarter and beyond. But it's a big impact early on that's going to be ex-US. And then, ultimately, a big impact in the US is going to be-- I think-- will be focused on using our vaccine as a booster next year because everybody will--

ANJALEE KHEMLANI: Right. Stan, I absolutely wanted to ask you about that. But first, let's focus on the ex-US, which is that focus for those 92 countries. You mentioned your partner, the Serum Institute, we saw how that partnership worked out for AstraZeneca and Oxford earlier on because it's continuing to be such a dire situation there. Do you see your vaccine playing a role and maybe falling under some of the same domestic pressures to circulate the vaccine in there first?

STANLEY ERCK: Sure. And so we have discussions going on with the Indian government because we want to have our vaccine that's made there shipped inside India, but also to support this COVAX commitment we have of $1.1 billion. And I believe that the Indian government is going to allow us to not only make the product in India for India, but for the COVAX facility and for all of our commitments.

And so we have plants in the Czech Republic, in Spain, in the US, and Korea, where we can make product there for our COVAX. So it's quite an extensive network.

ANJALEE KHEMLANI: Well, and so let's bring it back to the US. I know you mentioned the booster market, and that's obviously a key market for pretty much any vaccine maker that gets authorized this year. But looking beyond that, there is still a large portion of the US, certainly in pockets where there has been hesitancy about the newness of the mRNA platform or hesitancy over the concerns of the Johnson & Johnson vaccine. Do you see Novavax playing a role filling in there, or are you facing some of the same hesitancy issues?

STANLEY ERCK: No, I think-- you know, I think that there is a pocket of people who are waiting for a vaccine that has the more traditional approach of a protein-based vaccine like we're using. So when we get that approved, we'll be able to fill that demand.

AKIKO FUJITA: And Stanley, following up on Anjalee's question there on the booster shots, a lot of questions right now about just how long the efficacy will last for those of us who have already been vaccinated. What does the booster market look like in the US here? In looking months down the line, what does the fall look like in terms of the amount of those who are vaccinated and the additional booster shots that will be needed?

STANLEY ERCK: Yeah, I think-- we don't know. The answer is, we don't know everything yet because there's not enough time that's passed. But I think it's clear-- it's clear that we all have antibodies that decline over time because they-- all vaccines do. And whether it's six months or a year that it looks like the level has gone down enough that we can boost-- we have boosted. Both in our non-human primates study that we started a year ago, and vaccinated baboons and saw their antibody levels go very low, and then we boosted a year later. They got tremendous responses. Way higher than they got the first two doses. So it works.

And so whether you have to have a boost every year, or whether it's every two or five years, we'll find out over time. But I think it's going to be important for boosting.

ANJALEE KHEMLANI: Stan, talk to me about the manufacturing. I know that you've committed to the capacity of 150 million doses per month by the end of the year. Has anything changed in the past couple of months, as we've seen different companies sort of branch out in terms of delivering to various global-- to various countries? Has the pressure on the supply chain decreased at all, or has it maintained?

STANLEY ERCK: No, I think that it's a good point. You know, we've been constrained for the past six months, off and on, by, we can't get some raw material, we can't get some depth filter that you need to filter the product in the manufacturing process, or you can't get 2,000-liter plastic bags to grow it in. And some really dramatic shortages. That's starting to even out.

What you love to have in all of our eight plants is six months of inventory of all the stuff. And we don't. We have weeks in some cases, and we have months in others. But it's getting better, and our expectations, and when we make this forecast, that we can have 150 million doses running through our plants every month. We're expecting that we'll have the raw material supply straightened up by then. So we're pretty confident about that.

ZACK GUZMAN: And Stanley, just to wrap up here, I mean, when we talk about how it fits into your guys' role in this pandemic, thinking back to where it all began, there were some people-- I don't want to say there were haters on Novavax, but doubters out there that you guys could get here. Now you've proved them wrong. When it comes to your guys' payback on that, and what you're trying to do, low income countries doesn't sound like there's a lot of profitability opportunity around that, but how are you looking at it from your standpoint, in a business perspective and how profitable this is going to be for you guys? If you are going to play that, and what boosters might do to maybe play a factor in that as well?

STANLEY ERCK: You know, I think the problem gets solved when we show that we have a best-in-class vaccine. And if we start selling in the low income countries first, so be it. And so the profits will come bigger later. But I think we've shown now that we have the potential to be widely called the best-in-class vaccine, and that's what we intend to develop over the long run.

ZACK GUZMAN: Stanley Erck, Novavax CEO and President. Appreciate you taking the time here to chat with us alongside Yahoo Finance's Anjalee Khemlani as well.