Release Date: August 06, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Dynavax Technologies Corp (DVAX, Financial) achieved record HEPLISAV-B net product sales in Q2 2024, with over $70 million in revenue, marking a 24% year-over-year increase.
- The company reaffirmed its HEPLISAV-B product revenue guidance for the full year 2024, indicating confidence in continued market growth.
- Dynavax initiated a Phase I, II trial for its novel shingles vaccine program, Z1018, showing progress in its vaccine pipeline.
- The company reported an improved gross margin for HEPLISAV-B, reaching 83% in Q2 2024, up from 76% in the prior year quarter.
- Dynavax ended Q2 2024 with a strong financial position, holding approximately $736 million in cash, cash equivalents, and marketable securities, indicating sufficient capital for future growth.
Negative Points
- Research and development expenses increased to $15 million in Q2 2024 from $13 million in the prior year period, reflecting higher costs associated with pipeline progress.
- Selling, general, and administrative expenses rose to $42 million in Q2 2024, up from $37 million in the prior year, driven by sales force expansion and marketing investments.
- The company faces uncertainties in achieving its full-year guidance due to potential market fluctuations and external factors impacting vaccine uptake.
- Dynavax's long-term market share growth projections for HEPLISAV-B rely on assumptions about increasing vaccination coverage rates, which may not materialize as expected.
- The company's future growth and market share gains are contingent on successful execution of strategic opportunities and pipeline advancements, which carry inherent risks.
Q & A Highlights
Q: Can you provide expectations around market share by the end of this year or when you think you will break the 50% mark in market share? Also, should we assume a similar percentage of total year sales in Q3 and Q4 this year as we saw last year?
A: We don't provide guidance at that level of detail, but we expect to have a majority share by 2027. Regarding seasonality, we anticipate Q4 contraction at the higher end of historical ranges, around 15%, similar to last year. We expect Q3 to be a strong quarter as well. - Ryan Spencer, CEO, and Kelly MacDonald, CFO.
Q: What gives you confidence in the $800 million market growth projection for HEPLISAV-B by 2027?
A: We projected the market to be $800 million by 2027 based on increasing coverage rates due to the ACIP universal recommendation. We are tracking towards those projections, and our confidence is supported by historical market size and analogs from other vaccines. - Ryan Spencer, CEO, and Donn Casale, Chief Commercial Officer.
Q: How do recent trends in the COVID and RSV vaccine spaces affect your expectations for HEPLISAV-B seasonality?
A: COVID remains a large product, and RSV's lower utilization due to lack of recommendation for annual boost are tailwinds for HEPLISAV-B. This provides more vaccination opportunities, especially in retail pharmacies, which we have factored into our expectations. - Ryan Spencer, CEO, and Donn Casale, Chief Commercial Officer.
Q: What are you looking for in the Z1018 trial regarding CD4 levels, and what would prompt further investment?
A: We are evaluating different antigen levels and dosing regimens. We aim to identify a combination that provides CD4 levels similar to Shingrix, which would encourage further investment. - Robert Janssen, Chief Medical Officer.
Q: Can you provide a preview of the longer-term guidance you plan to release later this year?
A: We plan to update longer-term guidance to provide clarity on peak opportunity and post-peak market shape. We are refining our work and will provide a more quantitative update later this year. - Ryan Spencer, CEO.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
