WHEN: Today, Monday, January 10, 2022
WHERE: CNBC’s “Squawk Box”
Following is the unofficial transcript of a CNBC interview with Moderna CEO Stéphane Bancel on CNBC’s “Squawk Box” (M-F, 6AM-9AM ET) today, Monday, January 10th. Following are links to video on CNBC.com:
All references must be sourced to CNBC.
BECKY QUICK: The annual J.P. Morgan HealthCare Conference begins today. It’s the industry’s largest healthcare investments symposium and it will be virtual once again this year because of concerns about that Omicron variant. Meg Tirrell joins us right now with a special guest ahead of the conference kickoff. Meg, good morning.
MEG TIRRELL: Good morning, Becky. That’s Stéphane Bancel, the CEO of Moderna. Stéphane, thanks for being with us this morning kicking off our J.P. Morgan coverage. You know, just hearing from Eunice there, the whole world of course caught up in Omicron right now. What can you tell us about what the world looks like from where you sit about whether we’re going to need to update the vaccines to Omicron? What the future of our next potential dose looks like? When we might be getting that? What does it look like from where you sit?
STÉPHANE BANCEL: Good morning, Meg. So as we’ve shared recently, we are very pleased that the efficacy of our vaccine holds very well against Omicron for people that got the third dose and so I would really encourage anybody who has not gotten the third dose or has friend or family who only got two doses or god forbid have not been vaccinated to get protected because the real world evidence data, like the data published weekly by the UK shows a very, very strong protection and that’s a piece that gives us a lot of hope. You know, we have been very privileged in 2021 to help hundreds of millions of people. You know, we shipped 807 million doses around the world. We’re very pleased that around 25% of those doses are being supplied to low-income and middle-income countries. And this morning, we reported that all sales are going to be around, you know, $17.5 billion, we of course have to be fully audited in the coming weeks.
TIRRELL: And so, do you expect that at some point this year the decision will be made to have to update the vaccines? At what point will we know how frequently we’re going to need another dose. What does the future look like, as much as you can tell?
BANCEL: Sure, so again, with biology and this virus, we all want to be very humble. As you know, we’re working very actively on an Omicron specific vaccine as a booster. That should be in the clinic very soon and we are discussing with public health leaders around the world to decide what we think is the best strategy for a potential booster for the fall of 2022. We believe it will contain Omicron mRNA but do we need to add any other components. That has to be discussed because we need to be careful to try to stay ahead of a virus and not behind the virus. But it’s interesting Meg is if you look at governments around the world who are very much looking into 2022. You know, on our earning call on November 4, we said that our signed APAs were $17 billion that we had options for up to $3 billion and we were reporting this morning at J.P. Morgan that we are increasing those expectations because countries have been placing a lot of orders. Our signed APAs with upfront payments are now for $18.5 billion. Recently the UK, Switzerland, you know, South Korea have ordered for the fall of ’22. And now the options are being increased from 3 billion back in November to 3.5 billion and they are discussions ongoing on a daily basis. We have a lot of countries who want to be ready with the best product possible for fall of ’22. And as you know, the real-world evidence data has really shown very strongly and you see it in all the OECD country where it’s really, you know, mRNA vaccines being used, that the Moderna vaccine show very strong duration of efficacy and that’s really important to protect people.
TIRRELL: So, these orders are for the fall of 2022 and can be essentially whatever vaccine construct is deemed most appropriate at that time but essentially talking about boosting almost like we do seasonally with, with flu shots it sounds like. Meanwhile, the World Health Organization has set a goal of vaccinating 70% of the world by July and that’s unfortunately a pushback goal from when they had set, you know, to do it last year. Do you think it’s realistic that we can reach that goal by this summer? And is there more that Moderna could do to contribute to that?
BANCEL: So I think there’s two sides of getting the world vaccinated quickly. One is the supply of vaccine and the other one is the ability to get the doses in arms in those countries. If you look at the supply of vaccine, it is true that for around you know to two-third to three-quarter of 2021 to around September, October, the world was supply constrained with vaccine. There is no doubt but the world has totally switched to what the end of the year. You know, I share that in November we had any given day of the week between 50 and 100 million doses waiting to be shipped to low-income countries and there’s been a lot of issues on the distribution and deployment of those vaccines. And I’ve heard from my colleagues, you know, our vaccine company the same thing. We even shared this morning that we’ve heard last week from the African Union that the 60 million doses that we had reserved for them for Q2 this year, they decided to decline them. And the reason for that is between the COVAX orders, the donations from Europe, the donations from China, the donations from the US government. They have way more vaccine that they need to get to the 70% vaccination rates in those countries and so they informed us that they did not want the 60 million doses of Moderna vaccine for Q2.
BECKY QUICK: Hey Stéphane, just a quick question on following up on that. You mentioned that you have contracts that are ready to go with South Korea, the United Kingdom and Switzerland I believe for vaccines to be ready for the fall of this year. Where do things stand with the United States? Are you in negotiations with them and what’s the situation just in terms of how much you can supply come this fall? Will, will there be shortages or will every country that wants them be able to get them at that point?
BANCEL: That’s a great question, Becky, so let me just start with supply first. We’re in a very different situation that we were last year. In the last year, we were ramping up the supply chain, building the manufacturing capabilities, and if you look at the output that we had in Q4 with 300 million doses that was our highest quarter ever. You know, as a reminder, in Q1 we supplied 100 million doses. And we have a lot of new capacity coming online in Q1 of this year. And so, we think we can supply 2 to 3 billion doses of boosters this year. And if you look at the numbers I mentioned the 18.5 billion of already signed orders for 2022 and $3.5 billion of options, they are mostly front loaded in the first half of the year. They is still a lot of capacity available for the fall. And as I say there was a lot of discussions ongoing, including with the US government.
TIRRELL: And Stéphane, where do things stand with a vaccine for kids from Moderna, you know, with Pfizer’s getting delayed to some extent by a few months, there is a gap in coverage in the US for kids under five. Moderna, of course, is still waiting for clearance for under 18. And you, you need data for, you know, kids in that middle age group but I wonder because there is that gap in coverage, where do your data stand in terms of the timing of getting that and could Moderna potentially help fill that gap if your results are different from Pfizer’s and you get them earlier?
BANCEL: Yes. So indeed, Meg, you know, for teenagers, you know, we have a vaccine approved in most countries but the US. We should get very soon data in the younger children that do not have access to the vaccine today. We of course in literally discussions with the FDA several times a week. The agency is very up to date through the data and the timing of the data. As soon as we have the data, of course, we’ll share it and we are as always hopeful that we can help do our part and help protect as many people as we can.
ANDREW ROSS SORKIN: Hey Stéphane, I have two questions. One relates to targeting Omicron in terms of the next booster, there seems to be some debate in the scientific community about whether if you do that you effectively create or up the odds if you will that we actually get a new variant on top of it rather than dealing with the, the initial and I have to admit I don’t understand the, the science as well as I should, the initial approach to this with Alpha. Can you speak to that?
BANCEL: Sure. So, I think again, with biology, we all want to be humble. We don’t know what we don’t know. But the way I think about it Andrew is number one, as we see, unfortunately, many people are being affected as we speak. That is a great opportunity for a virus to mutate, given literally, I think several billions of people were going to get infected with symptoms or without symptoms with Omicron. What we have learned over the last, you know, year with vaccines available to the public and we’ve real-world evidence is that if you have very high neutralizing antibodies, you can prevent infection from person to person. And that’s a bit the trick that’s happening with Omicron is because there’s been such a huge genetic shift from the original virus to Omicron that actually the protection against infection person to person is actually not as good as it was with the previous variants and so we personally believe at Moderna that doing the next generation booster containing the Omicron sequence is going to be important not only to educate the immune system to those new mutation, but especially to protect infection between different people.
TIRRELL: I wasn’t sure if Andrew had a second question there but Stéphane, I’ll take it here. You know, we are asking you so much about your vaccine, obviously, because we’re in the thick of it right now and it’s still going to be important obviously for a long time to come. But you’re working on other things. You announced a deal this morning in oncology. I think a lot of questions from investors at the conference this week for you is going to be about your, your valuation and what you’ve got beyond the COVID vaccine. So what should we see from Moderna this year, what should we expect in terms of seeing a lot of those other mRNA focused projects coming to fruition?
BANCEL: Sure so as you know Meg, you know, mRNA is a platform. mRNA is an information molecule and so we have now forty-four zero programs that are in development and actually many more in the labs. And the thing that excites me is first around the respiratory disease. There are around 10 viruses that gets humans into hospitals every year. Flu, of course, is very well known but RSV, and many other viruses that are not very well known to the public because the symptoms are similar to flu where we believe the world deserves the single annual booster that contains all those different vaccines in a single dose against flu, against RSV, against COVID with the right adaptation to the strains circulating that’s here, and that’s what we’re working towards. You know, we have a RSV program in Phase 2/3, we have a flu program in Phase 2/3 and we’re working very quickly to combine this. The other piece we are doing is we are partnering with governments around the world to build manufacturing facilities in their countries so we can customize the vaccines to the strains circulating in the country. We’ve announced so far, you know, a 10-year agreement with Canada, but we’re building a plant in Canada for respiratory vaccines adaptation to the Canadian strain. We just announced recently the same 10-year partnership with Australia, where basically they’ve agreed they committed to pre-purchase respiratory vaccine. So that’s I think that’s gonna be a very big evolving product. The way I think about it, it’s a bit like you’ll get an annual upgrade of a product by adding more vaccine in the same vial. So, you’ll get an adaptation for the current strains of that year in your geography, so in the US, or in Europe, or in Japan because as we see a lot of winters, the flu vaccine are perceived not to work because we are actually different strains circulating around the world. So that’s the first chapter of Moderna respiratory vaccine. The second the one that I’m very excited about is latent viruses. Those are DNA based viruses that get into your body like HIV, and are in your body forever and they all create short term disease like EBV caused mononucleosis. CMV is the number one cause of birth defects in this country. And we want to prevent those things, mononucleosis and birth defects as caused to CMV but the long term impact of those viruses that basically drain you and weaken your immune system as huge implication, we believe on cancer and we’re working actively on that because there is no CMV vaccine on the market. And this year is going to be exciting because when we get data in the clinic in oncology, in genetic disease and autoimmune disease so a very exciting year ahead.
SORKIN: Two final quick questions. One is given how quickly unfortunately, it appears that the boosters and the vaccine diminish over time. I know we’re talking about the fall. There are a lot of people who have taken this in September and October, November if not earlier than that and that means that they would be going effectively six months without and so are you advising people or would you advise people to try to get it earlier? So somebody who took it in I don’t know September, October, I think I took mine in November, but you’d be pushed out effectively to May or maybe June as opposed to waiting until say September, October, November of this year?
BANCEL: Yes, Andrew so those are very important decisions for public health experts, those of governments that have to make those decisions. We are providing the data. What is important to remember is you know neutralizing antibodies are very important to protect you, of course, and those diminish with time but those are your T cells, the memory part of your immune system is important to prepare against severe disease. The other piece too is if you look at the data from the UK and South Africa, it seems that the Omicron wave, because it’s so contagious, is going to go very quickly, is going to go up very, very high very quickly and going to go down pretty quickly. And so, to your question, it is highly possible that by the time we are into the spring, that the number of cases of Omicron are much, much lower. And because so many people are getting infected, they are building an immunity, they also know boosting the immune response. So we have to wait a bit more to be a bit smarter about the data in the couple months. And I’m sure public health experts will make the right decision to protect people.
TIRRELL: Alright, Stéphane, we really appreciate you being with us this morning to help us kick off our J.P. Morgan conference coverage. Thanks so much. We’ll be listening to your presentation later and we’ll check in again soon we hope. Thanks again.
BANCEL: Thank you.
