WHEN: Today, Wednesday, March 29, 2023
WHERE: CNBC’s “Healthy Returns Summit: Moonshots to Miracles”
Following is the unofficial transcript of a CNBC interview with GSK CEO Emma Walmsley and CNBC’s Jim Cramer live during CNBC’s “Healthy Returns Summit: Moonshots to Miracles” today, Wednesday, March 29th.
All references must be sourced to CNBC’s Healthy Returns Summit.
JIM CRAMER: Hi, thank you so much Tyler. Emma, it’s always great to see you. You’re at the cutting edge of a company that actually literally when you took it over, I felt was a little bit cats and dogs, but now you are addressing the major issues of our time. I don’t want to just limit to RSV. You’ve got what I regard as being a strategy for the prevention and treatment of diseases that previous we’ve had nothing for.
EMMA WALMSLEY: Well, hi Jim, first of all and thank you so much for having me on today. I’m sure an exciting day and an exciting time for the industry and certainly as you say, for for GSK. I mean we have been through quite a radical transformation as a company over the last five years. We’re now a pure play biopharma and as you said absolutely after the major demerger of Haleon and absolutely resolutely focused on getting ahead of disease literally by preventing it and treating it and that is really taking advantage of this explosion in technologies, new vaccines technologies that we’ve seen, of course, mRNA, but also adjuvant technologies and new emerging technologies, which we think will contribute later in the decade, but also this great phenomena of adult vaccination. Preventing disease is always better or intervening earlier in disease but preventing it before it starts is always better for individual patients, for their heavy burden on healthcare budgets, but also systems and keeping people out of hospitals. I think the CDC says that there are a million hospitalizations in America alone from vaccine preventable diseases. Now, the world has woken up to the importance of vaccination hugely and you know the responsibilities of it as well over the last few years and it was really interesting to hear the comments just now on how important the retailer is to the sort of provision of vaccination as well. There are diseases that have not had any vaccine solution ever and RSV is one of them. Many have been working on trying to find a solution to RSV for 50 years, and now and we’re not the only ones to come forward but we were the first to publish results which we’re really excited about. We have a great vaccine candidate for this disease that unfortunately, 15,000 Americans die from every year, 175,000 hospitalizations every year from RSV and we have a vaccine where we are seeing for those that need it most so that is those with comorbidities, the over 60s which represent 94% of these hospitalizations. We have a vaccine with data that has 94% coincidentally efficacy and protection so we were absolutely delighted that in a recent ad com, we got a unanimous view on the efficacy for this vaccine and we’re really looking forward hopefully in a month or so to getting it approved and being able to bring it not only to the U.S. although it will be the U.S. first but also around the world you know there are over a billion over 60s worldwide. The demographics are only heading in one direction and just it’s another great building block to our vaccine portfolio building on SHINGRIX, adding RSV, of course we have future vaccines with our recent Affinivax acquisition in pneumococcal and then further opportunities in mRNA as well so very important, very exciting times and looking forward to partnering with the with the healthcare system and the retailers to bring it to the people that need it.
CRAMER: Let’s talk about that a minute. One of the things that I find again and again in your business is awareness. I mean, for instance, I have friends who have shingles. They don’t know about SHINGRIX. They will not know about your new vaccine. What about this gap between how evolutionary to revolutionary you’ve become and the system itself, which is simply evolutionary that doesn’t even know about these things?
WALMSLEY: Well, it’s a, it’s a great point because if you’d, I mean, you know one in three of us will get shingles, extremely painful. And that’s why you know, we our business grew we had a record year last year over 3 billion pounds worth of business and we still expect to keep growing very strongly with, with SHINGRIX again this year and for the years ahead. Three years ago, if you’d have asked the general public, you know, have you heard of RSV, what is RSV? I think people would have really struggled to be aware of it but just this last season, you heard a lot more public information actually about you know, a triple demic, a triple season through the winter whether that be ongoing Covid, ongoing Covid, obviously flu but also RSV and actually awareness now, you which is you know, really good to hear awareness now is is up over 50% in many parts of the general public. Also with prescribers very, very importantly and with pharmacists and retail so we are seeing that growing. Right now, Magic Johnson is communicating on a general disease awareness campaign to sideline RSV. So I think this is something we’re very, very thoughtful about but also communicating with responsibility and transparency on, you know, the the efficacy and the data on the vaccine too. So you’re absolutely right is in many ways, vaccination is a consumer product. So we need to make sure that we communicate very clearly on the benefits that can come from, you know, stopping these diseases before they start.
CRAMER: Well, in this way, I thought that Covid was actually no one would ever want to equate money with disease, but it was a boon for you. I found out about SHINGRIX because I went to get my Covid vaccine and my CVS practitioner said, “Where are you with SHINGRIX?” And until then I just said, “Well, I don’t know I hear about it. I guess it’s good.” But you’ve gotten people into the drugstores. They’re now part of your, of your effort to make it so more people live.
WALMSLEY: Well, that’s that’s absolutely right. And actually, it’s interesting and we have published some data that if you have suffered from Covid, your propensity with a weakened immune system to actually develop develop shingles goes up. But I think what’s what’s key in this is exactly the point you just referred to which is whether it be because the general public has got used to and understands the benefits of vaccination or frankly, the retailers have set up the systems and the data to, you know, access patients, but particularly traffic in their stores is really important to continue to protect, protect the general public and keep them out of hospital both for the associated costs, but also the burden of disease that that can develop too. So lots of opportunity ahead. You know, Jim, I think in the developed world, it’s only 3% of healthcare budgets, three, that are spent on preventing disease. The emergence of new technologies in vaccination is so exciting. And you know, there is a tremendous amount of opportunity ahead when you think about demographics and, you know, the enormous capital allocation that goes behind health care, that the opportunity we have to innovate here and that’s one of the great things also to see in the recent IRA regulation. You know, this is an area where the copay for vaccination was removed. So essentially at the point of distribution, you know, people don’t have any disincentive about worrying about whether they can afford to protect themselves for seniors. So, you know, great, great opportunities here. And, you know, I really think that the science and the innovation, as always, in our industry, and the technology, are all going to help to bring more solutions forward.
CRAMER: Alright, before we get to the exciting reinvention of Glaxo, I do want to address something. I’m always looking to China now for where things can go wrong, frankly, and there’s a people testing positive for influenza right now, hospitals across the country jumped to 53.2% in the week of March 12, more than 70 times higher than just five weeks ago. It’s H1N1 but it’s also H3N2. Can we look to Glaxo to help us and what be the next epidemic?
WALMSLEY: Well, it’s a very important question and I think the world has reflected hard on you know what we got right and you know, what opportunities there are to do better, not just individually, but collectively for the next epidemic. And I think the industry stepped up in very meaningful ways, whether it be in vaccination, or indeed in treatments. We, you know, certainly we, we have an approved vaccine now, but we we did also contribute meaningfully in terms of antibody treatments for those that weren’t able to be protected in time. I think we have an absolutely fundamental responsibility and not just within the industry, but you know, as we saw amongst governments, regulators, partners, to really make sure that we respond at pace, and we are very thoughtful and indeed, you know, extremely engaged quite formally on next pandemic preparedness so, not only in terms of innovation coming through, but the equity of the distribution of that innovation works well.
CRAMER: Alright, before you came on, we were talking about the idea of the Silicon Valley Bank, but really just that’s the micro, the macro is that there are a lot of companies that have not been able to get funding that are doing very exciting things. One of the things that’s been I’d say very much part of your realm is to find hard to beat diseases, then look at the companies that are private that may not have enough money, scoop them up and then really turn them into franchises. You’ve been doing that. I mean, I remember when you did it for for ovarian cancer. How’s that going?
WALMSLEY: Yeah, well, great. I mean, this is a really important point and I know that it’s going to be in a very exciting topic for for the full day session. You know, more than more than half of the innovation in this sector comes from outside big pharma and all of us more and more are continuing to bring in and supplement our pipelines with business development. And you know, there are still plenty of opportunities to do that. That was one of the things we tuned up and turned on much more aggressively. As you said, when we started in this big turnaround and step change in performance for GSK, which we’re delighted to see is really delivering now great year last year, another strong year of guidance this year. I’m very confident in our five year outlook in part because we’ve been able to supplement both our organic progress in the pipeline but also with some partner deals whether that be, as you said, in ovarian cancer with Zejula but also we had some great data come through on Jemperli, in fact, we just, in endometrial cancer just yesterday that we announced and that’s a really nasty I think it’s the leading gynecological cancer for women, 400,000 new diagnosis every year and you know, no new great treatments there for many decades actually beyond the standard of care with chemo and now some exciting indications there. That’s also building on the Rexel data we had before and also some some lung data as well. So you know, that’s, that’s been, you know, making really nice progress but also last year, two other really important bolt-ons we did. Affinivax I mentioned earlier, very exciting new vaccines technology for pneumococcal disease, that’s the second biggest vaccine market actually after Covid today, and we think we may have something that will give broader coverage for later in the decade but, you know, a really sizable opportunity there. We also bought Sierra Oncology, which will hopefully be launching momelotinib, which is for myelofibrosis, quite a rare blood cancer later this year. We’re looking forward to making progress on that. And, you know, one of the main reasons Jim for doing the demerger that we did with Haleon was to be able to create all this extra capacity to invest in partnerships or M&A and, you know, really delighted to continue to pursue that. Very pleased with the progress we’re making overall on the launches that we have upcoming, but there’s always more to do. Patients are waiting and it’s absolutely at the core of what we’re here for, is to continue to develop and strengthen our pipeline and there is no debate that is our number one priority.
CRAMER: Well, one of the incredible things when I look at your portfolio Emma is I see diseases that you work on. Meningitis, I mean, some people think that’s cured, you got to get a meningitis vaccine when you go to college. HIV, I think a lot of people feel that it’s over. No, and you continue to innovate—
WALMSLEY: No.
CRAMER: On diseases that we thought we beat.
WALMSLEY: Well, I mean meningitis again, we just published our, sounds like the alphabet, but our MenABCWY data, hit 11 primary endpoints on meningitis. And as you say, you know, it’s a terrible disease with quite a high infection rate, low penetration of vaccination. I think it’s about 30% and yet one in 10 people that will get and children or teenagers mainly that catch meningitis just one and 10 will die from it and often in in really brutal like 24 hours. This is one that always marks me because I remember there was a girl I was at high school with who who very sad and this is obviously many decades ago but died in her first year in, in college and and you know there is a reasonably simple solution to this which is vaccination some countries have, you know, very formal rules on it, but there’s a big opportunity here now we have broader coverage and we’re excited about bringing that forward. HIV, I’m so glad that you raised because this is far from over as an agenda. Wonderful to see the U.S. government particularly so committed to ending HIV and amazing to see how innovation across our sector has truly transformed this from a death sentence to being something that you can live with your full life. I’m very proud of how we have pioneered in innovation in HIV many times whether we’re the first integrase inhibitor coming through with two drug regimens with DOVATO, which is, you know, continued to grow extremely strongly into blockbuster but perhaps most excitingly more recently pioneering in this long acting injectable where we’re, you know, five years ahead of the of the competition both in treatments but also we have a prevent, a prevention injection so people can get instead of, you know, 365 pills a year, you are getting an injection six times a year for treatment. And you know, we just published data that proves, you know, very comfortably, parity performance against against pills and great protection but, you know, significantly more, both convenience but also discretion, which still matters to a lot of patients, but there’s new innovation coming through. We’re looking forward to getting to longer acting, long acting, potentially self-administration long acting and, you know, next year, hopefully we’ll be able to update people more on how we’re making progress on that for later in the decade, but there’s still a lot of work to do. And I’m gonna say, you know, particularly in the U.S., you know, we don’t have enough patients with virus fully under control. So, you know, excited about the opportunity that the innovation can bring there in a class which, fortunately, is protected where we have a fantastically active patient body.
CRAMER: Well, one of the things I love about your administration, the company, you’re not afraid to fail. I mean, you’re taking on things like UTI. Everyone knows—
WALMSLEY: Not my goal though.
CRAMER: Look, there’s been resistance, okay, the bacteria is beating us. People know that. We think that the bacteria that frankly, there’s resistance and the – can’t be can’t be beaten, not you. You say you know what? This is an illness that millions of people suffer for I’m not going to just say hey, listen, we lost this battle. I’m gonna go take it on.
WALMSLEY: Well, I that’s a great topic, you know, and a lot of people this is really foundationally important Jim. A lot of people refer to AMR, antimicrobial resistance, as the slow pandemic. If the world does not develop new and effective antibiotics, you know, the assessments are that 10 million people a year will be dying by 2050. And from diseases now that we are really used to treating with antibiotics but where resistance is building so we’re absolutely delighted whether that be in our, you know, homegrown home developed insight organically developed portfolio with Gepotidacin that’s hopefully going to be a new and exciting launch for a very common problem of UTIs, urinary tract infections, where resistance can be quite high, and we think it’s going to be it’s what’s going to be hopefully the first new antibiotic for many decades in this disease, which will help address help address this and we stopped that clinical trial for efficacy a bit early, but also we’ve done some BD again, you referred to it earlier for with for new asset, for more complicated infections. And yeah, we continue to be very thoughtful about investment here. You know, the the age old challenge is how do you do this in a way that’s going to be economically viable and we’ve done this by really being forensic about picking the assets, the thinking about the patient groups, where we can make, you know, a genuine, genuinely appealing return but also frankly fulfill what in our sector continues to matter, which is this responsibility to broader society to solve these problems that, you know, have enormous scale and where innovation is going to be absolutely key. And of course, I keep going back to it don’t underestimate the importance of vaccination in actually foundationally addressing the core of this whole AMR agenda as well. It really matters and actually the industry has stepped up more broadly. I think, you know, GSK is well recognized for leading in lots of ways in pipeline here, but the whole industry has stepped up and we’ve been part of the fund that’s been established to try and support more innovation to get in on this.
CRAMER: Well that’s where—
WALMSLEY: We also need regulation and the buyer environments to and the payer environments to recognize some different models here. And you know, there are some good discussions going on on that and I hope we can make progress on it in the in the U.S. as well eventually with the—
CRAMER: I’m so glad you want to leave it like that. So we’ll wrap things up with a kind of more of a philosophic question. Before Covid, I think there were a lot of people in our country who felt that drug companies were rapacious companies, that what they were about was raising prices. Ever since Covid, I think we realize that drug companies are probably one of the greatest forces for medical and social change and for having people live longer. Do you think that the sea change can stay with us because I, I know you are business people. Now you are in the business of saving lives. I’m in the business of trying to pick stocks. But what’s happened, I think is you’re the good guys. I think that’s changed.
WALMSLEY: Well, I think it’s really important that people understand the deep challenge involved in vaccine and drug development. And I don’t I can’t think I mean 99.9% of the people involved in our industry are motivated by the impact, the positive impact that innovation can have, and patients are waiting. I mean, there are still so many cancers that don’t have, you know, serious and complete solutions. One in three of us and we’ll probably get to one and two as the population ages is going to be facing in some kind of neurodegeneration. Infectious diseases are this permanent threat you refer to them and the best, the single best solution to that is innovation from our industry and it is super high risk. It takes a long time and it costs a lot of money and to be able to digest that it’s not just a question of and by the way, rightly, we have the patent cliff model, which means we have to replace ourselves every decade so to secure access, so there’s no generics market without an innovation market and it is really important whether it be in U.S. industry or at global scale that we continue to support the innovators with recognition of the importance, the value creation, I mean, you know, again, think about the value creation from keeping somebody out of hospital with a simple vaccine. The sort of value creation that comes and an understanding of the challenges involved and the economics required to cover for that cost of failure. And I think all of that said, being clear and simple on the communication of what we do and responsible in the way we do it and if things go wrong, responding to that quickly, being responsible in our pricing, and caring about access, continues to drive the social contract that our industry has with broader society and all those that fund our work. So, you know, I don’t think there has ever been a more exciting time to be in the sector. I think it is the golden age of biology and technology. I think distribution is changing radically. And you know, it’s a great privilege and tremendous responsibility as well to be part of all of it.
CRAMER: Well, Emma Walmsley, CEO of GSK, you are terrific spokesperson for the industry. And I want to thank you so much for coming on “Healthy Returns.” Tyler, back to you.
WALMSLEY: Wonderful to see you Jim.
