Release Date: February 20, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Dynavax Technologies Corp (NASDAQ:DVAX) achieved record fourth-quarter and annual revenue for its hepatitis B vaccine, Heplisav-B, with net product sales expected to grow between $305 to $325 million in 2025.
• The company has increased its market share to 44% in the US adult hepatitis B vaccine market, demonstrating strong commercial execution.
• Dynavax Technologies Corp (NASDAQ:DVAX) is advancing its shingles vaccine program, Z1018, with promising phase 1 results showing comparable efficacy to the market leader, Shingrix, but with improved tolerability.
• The company has a strong financial position, with cash equivalents and marketable securities of $714 million, enabling it to return capital to shareholders through share repurchase programs.
• Dynavax Technologies Corp (NASDAQ:DVAX) expects to achieve significant milestones in its development pipeline in 2025, including the advancement of its plague vaccine program in partnership with the US Department of Defense.

Negative Points

• The company's research and development expenses increased by 32% year over year in the fourth quarter, indicating rising costs associated with advancing its clinical pipeline.
• Despite strong market share gains, the hepatitis B vaccine market share in retail pharmacy and integrated delivery networks remained flat year over year.
• The company faces uncertainties in its clinical trials and regulatory submissions, which could impact the timing and success of its pipeline programs.
• Dynavax Technologies Corp (NASDAQ:DVAX) is reliant on external partnerships and regulatory approvals to advance its shingles vaccine program, which could delay its market entry.
• The company's future growth is dependent on maintaining its commercial efforts and market share in a competitive landscape with established competitors.

Q & A Highlights

• Warning! GuruFocus has detected 4 Warning Sign with DVAX.

Q: What are the key factors driving market share growth for Dynavax's hepatitis B vaccine, Heplisav-B, in 2025? A: Don Cassell, Chief Commercial Officer, highlighted two major market events: access to the Medicare patient population in retail settings and the inclusion of hepatitis B vaccination in the healthcare effectiveness data and information set (HEDIS) measure. These factors, along with continued customer engagement, are expected to support market share gains and growth in both retail and integrated delivery networks (IDNs).

Q: What is the significance of CD4 T cell responses in the shingles vaccine program, and how do they impact the development strategy? A: Rob Jansen, Chief Medical Officer, emphasized that CD4 T cell responses are critical in assessing the immunogenicity of the shingles vaccine. The quality and durability of these responses, along with antibody responses, will be key factors in determining the vaccine's efficacy and guiding the development strategy for future studies.

Q: How does Dynavax plan to manage the financial risk associated with the phase 3 trial for the shingles vaccine? A: Ryan Spencer, CEO, stated that Dynavax aims to leverage business development opportunities, particularly in ex-US markets, to reduce financial risk. The company plans to use phase 2 data to support partnerships that can help absorb costs and risks associated with the phase 3 trial.

Q: What changes in Medicare reimbursement could impact Heplisav-B's market share? A: Don Cassell explained that hepatitis B vaccines are now recognized under Medicare Part B, allowing pharmacists to reimburse the vaccine at retail settings. This change provides Heplisav-B with equal access compared to other vaccines, potentially supporting market share gains and market growth.

Q: How does Dynavax view the potential market for its plague vaccine program? A: Ryan Spencer noted that the market size depends on government threat assessments. Currently, the focus is on the Department of Defense, but the opportunity could expand if the threat is deemed significant for the broader population. The goal is to optimize the product profile and assess the opportunity as it develops.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.