WHEN: Today, Monday, March 30, 2020
WHERE: CNBC’s “Squawk Box“
The following is the unofficial transcript of a CNBC interview with Johnson & Johnson CEO Alex Gorsky on CNBC’s “Squawk Box” (M-F 6AM – 9AM) today, Monday, March 30th. The following is a link to video of the interview on CNBC.com: https://www.cnbc.com/video/2020/03/30/johnson-johnson-ceo-on-how-close-company-is-to-coronavirus-vaccine.html.
All references must be sourced to CNBC.
ANDREW ROSS SORKIN: Welcome back to “Squawk Box” this morning. We have some big news on the fight against the coronavirus. Last hour Johnson & Johnson announcing it’s now selected a lead vaccine candidate and says it expects to begin Phase 1 human clinical trials by September, at the latest. Joining us now is Johnson & Johnson CEO Alex Gorsky. And we’re thrilled to have him on the program. Alex, thank you for joining us. This is very good news. Tell us about what’s gone into this and why you are so optimistic about it.
ALEX GORSKY: Well, Andrew, and Joe, and Becky, thank you very much for having me on, though it’s always tough to follow Senator Cruz. But, you know, we’re very excited about the announcement that we’re making this morning about the partnership we’re doing with BARTA, which is the government agency responsible for pandemics and vaccines and what we’re doing to accelerate our development but also, our production for something against COVID-19. And you know, really, this started decades ago. We’ve been working in the immunology field for some time. We’ve been working in areas, for example, like SARS, Ebola, HIV. And I think what gives us confidence is based upon the work that we have done with this vaccine platform, we have very good early indicators that not only can we depend on this to be a safe vaccine base, but also one that will ultimately be effective based on all the early testing and modeling that we’ve been doing. You know, as you mentioned earlier, we expect to begin first human testing in September. But, in parallel, not only do you need a safe and effective vaccine but you also need to have one that can be produced in large volumes. We are going to be doing that at risk simultaneously right here in the United States. And we expect to have results, interim results at least, from our trials likely in December at the latest early January. That should put us in position early in 2021 to literally have hundreds of millions of doses available and by the end of the year up to 1 billion. That’s our plan. That’s the reason why we’re confident. We understand we have got more testing. We still have a lot more work to do. But this is a bit of a moonshot for J & J, but going forward, it’s one we feel is very important for us to be doing at this point in time.
ANDREW ROSS SORKIN: So, Alex, in terms, though, of the timeline, the ability to get this into the marketplace, if you will, you’re talking about early 2021 for lots of people to get this. Is that just for special access? Or are you talking really about next summer? What’s that timeline looking like in your mind?
ALEX GORSKY: Sure, Andrew. I don’t mean to sound like an economist, it is going to depend on a few factors. But let me tell you why we’re optimistic. If we have the interim results from clinical trials late this year and let’s just project forward. A time where frankly there still is significant concern about the pandemic as we head into 2021, we will have the ability to work with regulators, to determine, first of all, that we have a safe and effective vaccine based on trial results within the first quarter of next year. And because we will have made the efforts to open up a production facility here in the U.S., to do all the technology transfer that is required, we should also be in a position to have a very significant number of dosages available in that Q1 Q2 period. Now, look, we are going to l have to learn more. We’ll have to see exactly what our yield is, but we’re very confident in the underlying technology that we have, that we — that we can have that level of dose ages available and ultimately make the right decision early in 2021 about, you know, what’s in the best public health interest and how we proceed.
ANDREW ROSS SORKIN: Alex, what is this vaccine going to cost the consumer, do you imagine? And your stock has moved on this number. Is this going to be profitable for you?
ALEX GORSKY: Well, look, this is about doing right but for global public health. And as we said in our statement, we want our number one concern after bringing it out and demonstrating that it’s safe and effective is to make sure that it’s accessible and affordable on a global level. In fact, we’re taking this step further and we’ll do this on a not for profit basis. We’re working jointly with the government on this where we’ll be putting more than $1 billion worth of investment in terms of the research and development, but also scaling up the production capacity on this. You know, in the very near-term. And so that is our expectation it’s difficult for me to say an exact price because we still have to determine some of these other factors be. We want to make sure that everyone can get access and that we can do so consistent with what you see other commonly used vaccines for here in our country and around the world.
JOE KERNEN: Hey Alex, you had your economist hat on for a second. Put on your scientist hat for me. Tell me what you’re keying on in terms of basing the vaccine on. Is it something on the surface of the virus? Is something that is in the nucleic acids, the RNA itself? And is it — why are you confident this is conserved? In other words, if there’s mutations, this will be essential to the way the virus works, so it will continue to work, even if there is a mutation.
ALEX GORSKY: Joe, appreciate the question. And let me respond this way. First of all, we have a lot of confidence. Because, you know, when you’re building a vaccine, you’ve got to think about it — one way to think about it is like a car. And the body of the car, the platform that we’re using is one we have already demonstrated safety and efficacy in things like SARS, which you know as a biologist, is a similar condition or similar science to what we’re seeing with COVID-19. We’ve also used it in older patients for Ebola, for example, in younger patients. And we have seen the safety to be, you know, very consistent. The next step, of course, is okay, what kind of a motor, what kind of software can we insert into that car that will be effective against COVID-19? What we know about all of the work we’ve done in vaccines is the early testing that we’re doing, both in Vivo and in some animal models, tends to be predictive of ultimately what you’re going to see in the human trials itself. As you know, coronavirus, it’s a tough coronavirus. It’s an RNA virus. So, we’re — based upon what we’ve seen so far, we think we have the right approach. Obviously, we wouldn’t be taking these other steps if we didn’t feel that way. But we do have to conduct the human trials and we’ll learn more through that process as we go through the fourth quarter of this year.
JOE KERNEN: You can scale up manufacturing quickly and get a lot of it. It’s not like some of the vaccines that are very difficult to make.
ALEX GORSKY: Joe, that’s a great point. And as I’m sure you’re aware, with traditional vaccines, frequently you’re actually working with an egg, like a chicken egg, where you may be able to yield a couple of doses per egg. It has to be done on the surface of a very large vat, and that of course takes time and can result in years of development. What is unique about our approach — and it’s interesting because actually from a technology, another vaccine platform that we’re going after, initially we didn’t achieve some of our objectives, that frequently happens in investment, and research and development. But the production capability, it’s called PER. C6, and basically what that does, instead of having to use an egg or instead of having to have it on the surface, this can be done where it’s very — in an intense environment. So, think of a thousand-liter beaker, where these proteins can be harvested. They don’t need to be on the surface. And so, we can get high yield. So, for example, in a 1,000-liter beaker, we’re getting yields of hundreds of millions of vaccines. And that, of course, is what gives us the confidence that not only will we have a vaccine that works but we can produce it in the kinds of volumes that are really going make the difference and frankly tamp down the curve and, you know, eventually prevent this virus from happening in the first place.
BECKY QUICK: Alex, that’s kind of related to my question. I know you that guys are taking what would normally take five to six years and compressing it into five to six months. I’m just wondering, is that because technology is advancing so quickly? Is that because you’re pouring a billion dollars’ worth of resources into it or because the FDA is relaxing some of its guidelines? What gets you to that point?
ALEX GORSKY: You know, Becky, it’s all of the above it starts with — huge thank you to Dr. Paul Stoffels, Dr. Johan Van Hoof, people who have poured, you know, a good chunk of their careers into understanding infectious disease and conditions like this. They have literally been working 24/7 to identify, you know, how do we, first of all, put this through the most rigorous tests that are going to give us the signal that indicates it. And we quickly went through our library, and that’s where now we have focused on this one particular vector that we’re highly confident in. Simultaneously, we’ve been working on all the technology transfer, the production ramp-up. So, another shout out to our global supply chain colleagues who have been working around-the-clock to say how can we do this and how can we do this in the United States, even though that’s not where the original technology was developed? How can we bring it to a level that we can scale up, not compromise at all in regarding safety and quality but do it in the right way? So, all those factors. Then, of course, the partnership with the United States and I want to thank the government, BARTA, the work they’ve been doing, HHS, also the FDA, they work closely with us. If you do an interim analysis statistically, how can we accelerate that? Again, making sure we’re getting all the information that we need, but also recognize frankly the situation that we’re in around the world.
ANDREW ROSS SORKIN: Alex, we want to thank you for joining us this morning. We want to wish you well. Your success will be the world’s success, and we appreciate you joining us this morning.
ALEX GORSKY: Andrew, Joe, thank you. Look, biology started this, biology and pharmacology will be a big part of winning this in the end, and we are absolutely committed to making that happen. Thank you, guys.
ANDREW ROSS SORKIN: Okay. Alex Gorsky from J&J. We appreciate it. We’ll be back tomorrow. CNBC’s special coverage continues right now.
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