NOVAVAX INC 10-Q

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations Cautionary Note Regarding Forward-Looking Statements This Quarterly Report on Form 10-Q (this “Quarterly Report”) contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Any statements in the discussion below and elsewhere in this Quarterly Report about expectations, beliefs, plans, objectives, assumptions, or future events or performance of Novavax, Inc. (“Novavax,” together with its wholly owned subsidiaries, the “Company,” “we,” or “us”) are not historical facts and are forward-looking statements. Such forward-looking statements include, without limitation, statements about our capabilities, goals, expectations regarding future revenue and expense levels, and capital raising activities; our strategic priorities, our corporate growth strategy, including our early-stage pipeline and research and development (“R&D”) investment strategy and key value drivers; our technology platform; our COVID-19 program (our “COVID-19 Program”) (which currently includes our Nuvaxovid prototype COVID-19 Vaccine ("NVX-CoV2373” or “prototype COVID-19 Vaccine”), our Nuvaxovid COVID-19 vaccine for the 2023-2024 vaccination season (“NVX-CoV2601”) and our Nuvaxovid updated COVID-19 vaccine for the 2024-2025 vaccination season (“NVX-CoV2705” or “updated COVID-19 Vaccine”) collectively, referred to as our (“COVID-19 Vaccine”)); our operating plans and prospects, including our ability to continue as a going concern through one year from the date of our unaudited financial statements for the period ended June 30, 2025 are issued; the implementation and anticipated impact of our global restructuring and cost reduction plan (“Restructuring Plan”), which includes a more focused investment in our COVID-19 Program; our cash flow forecast and projected revenue, including potential royalties and milestones pursuant to our collaboration and license agreement (the “Sanofi CLA”) with Sanofi Pasteur Inc. (“Sanofi”) and our other license agreements; potential market sizes and demand for our products and product candidates; the efficacy, safety, and intended utilization of our products and product candidates; the development of our clinical-stage product candidates and our recombinant vaccine and adjuvant technologies; the development of our preclinical product candidates; our expectations related to enrollment in our clinical trials; the conduct, timing, and potential results from clinical trials and other preclinical studies; plans for and potential timing of future and pending regulatory filings and actions; our ability to successfully conduct our postmarketing commitment (“PMC”) study requested by the U.S. Food and Drug Administration (“U.S. FDA”) following the U.S. FDA’s approval of the Biologics License Application ("BLA”) for our COVID-19 Vaccine; our expectation of manufacturing capacity, timing, production, distribution, and delivery for our COVID-19 Vaccine by us and our partners, including our anticipated timing of the U.S. FDA’s approval of our BLA supplement to extend the shelf life of our COVID-19 vaccine; our expectations with respect to the anticipated ongoing development and commercialization or licensure of the COVID-19 Vaccine; our expectations with respect to the anticipated ongoing development of COVID-19 variant strain-containing monovalent or bivalent formulations, including the Phase 2b/3 Hummingbird™ trial, and our COVID-19-Influenza (“CIC”) vaccine candidate and our stand-alone influenza vaccine candidate including partnership efforts for our CIC vaccine candidate and stand-alone influenza vaccine candidate to advance towards a BLA filing and commercialization; efforts to expand the COVID-19 Vaccine label worldwide as a booster, and to various age groups and geographic locations; the expected timing, content, and outcomes of regulatory actions; funding under our advance purchase agreements (“APAs”) and supply agreements and amendments to, termination of, discussion regarding, or legal disputes relating to any such agreement; our available cash resources and usage and the availability of financing generally; plans regarding partnering activities and business development initiatives; our plans regarding APA amendments; and other matters referenced herein. Generally, forward-looking statements can be identified through the use of words or phrases such as “believe,” “may,” “could,” “will,” “would,” “possible,” “can,” “estimate,” “continue,” “ongoing,” “consider,” “anticipate,” “intend,” “seek,” “plan,” “project,” “expect,” “should,” “would,” “aim,” or “assume,” the negative of these terms, or other comparable terminology, although not all forward-looking statements contain these words. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs and expectations about the future of our business, future plans and strategies, projections, anticipated events and trends, the economy, and other future conditions. Forward-looking statements involve estimates, assumptions, risks, and uncertainties that could cause actual results or outcomes to differ materially from those expressed or implied in any forward-looking statements, and, therefore, you should not place considerable reliance on any such forward-looking statements. Such risks and uncertainties include, without limitation, our ability to successfully and timely obtain and maintain full U.S. FDA licensure or foreign regulatory approvals necessary to manufacture, market, distribute, or deliver our COVID-19 Vaccine; the impact of delays in obtaining regulatory approval, including regulatory decisions impacting labeling, approval or authorization, including the scope of the indicated population, product dosage, manufacturing processes, shelf life, safety, for our product candidates; challenges in conducting the PMC study, our ability to obtain adequate additional funding to maintain our current level of operations and fund the further development of our vaccine candidates; challenges related to our partnership with Sanofi, including collaboration on the PMC, and in pursuing additional partnership opportunities; challenges satisfying, alone or together with partners, various safety, efficacy, and product characterization requirements, including those related to 27 process qualification, assay validation, and stability testing, necessary to satisfy applicable regulatory authorities; challenges or delays in conducting clinical trials or studies for our product candidates; manufacturing, distribution or export delays or challenges; our substantial dependence on Serum Institute of India Pvt. Ltd. (“SII”) and Serum Life Sciences Limited (“SLS” and together with SII, “Serum”) for co-formulation and filling our COVID-19 Vaccine and the impact of any delays or disruptions in their operations; the impact of potential legislative, regulatory, or policy changes under the current presidential administration, including any adverse impact funding for vaccine research and development, reimbursement for vaccines and their administration, vaccine mandates and recommendations, and public perception of vaccine importance; uncertainty with respect to pricing, third-party reimbursement and healthcare reform; uncertainty in the regulatory pathway for our COVID -19 Vaccine; the impact of any new or changes in interpretations of existing trade measures, including tariffs, embargoes, sanctions, import restrictions, and export licensing requirements; difficulty obtaining scarce raw materials and supplies, including for our proprietary adjuvant; resource constraints, including human capital and manufacturing capacity, constraints on our ability to pursue planned regulatory pathways, alone or with partners, in multiple jurisdictions simultaneously, leading to staggering of regulatory filings, and potential regulatory actions; our ability to timely deliver doses; challenges in obtaining commercial adoption and market acceptance of our COVID-19 Vaccine or any COVID-19 variant strain containing formulation, or our CIC vaccine candidates, stand-alone influenza vaccine candidates or other candidates; challenges meeting contractual requirements under agreements with multiple commercial, governmental, and other entities including requirements to deliver doses that may require us to refund portions of upfront and other payments previously received or result in reduced future payments pursuant to such agreements; challenges related to the seasonality of vaccinations against COVID-19; challenges related to the demand for vaccinations against COVID-19 or influenza; challenges in identifying and successfully pursuing innovation expansion opportunities; our expectation as to expenses and cash needs may prove not to be correct for reasons such as changes in plans or actual events being different than our assumptions, and other risks and uncertainties identified in Part I, Item 1A “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2024, and this Quarterly Report on Form 10-Q, which may be detailed and modified or updated in other documents filed with the SEC from time to time, and are available at www.sec.gov and at www.novavax.com. You are encouraged to read these filings as they are made. We cannot guarantee future results, events, level of activity, performance, or achievement. Any or all of our forward-looking statements in this Quarterly Report may turn out to be inaccurate or materially different from actual results. Further, any forward-looking statement speaks only as of the date when it is made, and we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, unless required by law. New factors emerge from time to time, and it is not possible for us to predict which factors will arise. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Overview We are a company tackling global health challenges through scientific innovation that seeks to maximize our deep scientific expertise in vaccines and our cutting-edge technology platform. The differentiated platform features our recombinant protein-based nanoparticle technology and unique Matrix-M adjuvant. Our three strategic priorities are: focusing on our partnership with Sanofi announced in May 2024, enhancing existing partnership and leveraging our technology platform and pipeline to forge additional partnerships, and advancing our proven technology platform and early-stage pipeline. Our corporate growth strategy is supported by a lean and focused operating model. Our technology platform combined with our deep vaccine expertise, is the fuel for innovation and partnerships and we believe it has the potential to create significant value. Our proprietary Matrix-M adjuvant when added to vaccines, has been shown to help induce a strong and long-lasting immune response. Our recombinant protein-based nanoparticle technology has been shown to be highly immunogenetic. Together, we believe that our technology platform can induce potent, durable and broad immune responses, with the potential to be antigen-sparing. Our Matrix-M adjuvant can increase both antibody and cell-mediated immune responses in vaccines and it has demonstrated a favorable tolerability profile in clinical trials. Our technology platform is used in our authorized COVID-19 Vaccine and the R21/Matrix-M adjuvant malaria vaccine. In May 2024, we entered into a CLA with Sanofi, to co-commercialize our COVID-19 Vaccine, including future updated versions that address seasonal COVID-19 variants. Sanofi has the right to develop novel influenza-COVID-19 combination vaccines utilizing our COVID-19 Vaccine and Sanofi’s seasonal influenza vaccine, combination products containing our COVID-19 Vaccine and one or more non-influenza vaccines, and multiple new vaccines utilizing our Matrix-M adjuvant. In December 2024, Sanofi announced that the U.S. FDA granted Fast Track designation to two Sanofi combination vaccine candidates: the first combination consists of Fluzone High-Dose TM combined with our COVID-19 Vaccine, and the second combination consists of Flublok TM with our COVID-19 Vaccine. Sanofi is evaluating the safety and immunogenicity of both combination vaccine candidates in two separate Phase 1/2 trials. We are eligible to receive royalties and milestones associated with the ongoing sales of our COVID-19 Vaccine and Sanofi’s influenza-COVID-19 combination vaccines and any 28 other combination vaccines Sanofi may develop, as well as ongoing product royalties for vaccines developed with our Matrix-M adjuvant. We discuss this agreement in further detail in Note 6 to our accompanying unaudited consolidated financial statements. Additionally, we are advancing our pipeline of both late- and early-stage programs with a focus on potentially high-value assets in areas with unmet medical need, compelling scientific rationale and strong commercial opportunity. Our late-stage programs include a CIC vaccine candidate, as well as a stand-alone influenza vaccine candidate. In June 2025, we reported data from the initial cohort of a Phase 3 trial comparing our CIC vaccine and stand-alone influenza vaccine to our updated COVID-19 Vaccine and a licensed seasonal influenza vaccine comparator in adults aged 65 and older, which showed both vaccine candidates induced robust immune responses across all antigens tested. Both vaccine candidates were well tolerated and saw reactogenicity comparable to authorized comparators. We intend to partner these vaccine candidates to advance further development. Furthermore, we provide our Matrix-M adjuvant for use in collaborations. These include the R21/Matrix-M adjuvant malaria vaccine, a malaria vaccine developed by our partner, the Jenner Institute, University of Oxford (“R21/Matrix-M adjuvant malaria vaccine”) and manufactured by SII. R21/Matrix-M adjuvant malaria vaccine is authorized in several countries. Additionally, we provide Matrix-M adjuvant for use in various programs in preclinical and clinical stage, as well as preclinical investigations. Examples include, an agreement with the Gates Foundation, two material transfer agreements with leading pharmaceutical companies for exploration of Matrix-M adjuvant used as a potential advancement in their pipeline, and a third material transfer agreement to explore Matrix M in a pre-clinical collaboration in oncology. We continue to advance our early-stage pipeline. We intend to develop our early-stage pipeline using a disciplined and capital-efficient approach. Our R&D investment strategy seeks to place targeted investments on the programs with the highest potential value, both within infectious disease and beyond, with the intent of partnering these programs at proof of concept. We would consider advancing a program ourselves where data and commercial landscape indicate a unique high-value opportunity. We are pursuing early-stage research in diseases such as, respiratory syncytial virus (“RSV”) combinations, varicella-zoster virus (shingles) and Clostridioides difficile (C. Diff.) colitis. We are actively working to evaluate several RSV combination candidates to progress forward toward an Investigational New Drug (“IND”). We are actively developing an H5N1 avian pandemic influenza vaccine candidate and the toxicology study is underway. We are pursuing funding opportunities to join preparedness options. Additionally, we are evaluating potential expansion beyond infectious diseases, where we believe our technology could augment and improve upon current therapies. Technology Overview We believe our recombinant nanoparticle vaccine technology and our proprietary Matrix-M adjuvant are well suited for the development and commercialization of vaccine candidates targeting areas both within and beyond the infectious disease space. Recombinant Nanoparticle Vaccine Technology Once a target of interest has been identified, the genetic sequence encoding an antigen is selected for developing the vaccine construct. The genetic sequence may be optimized to enhance protein stability or confer resistance to degradation. This genetic construct is inserted into the baculovirus Spodoptera frugiperda (“Sf-/BV”) insect cell-expression system, which enables efficient, large-scale expression of the optimized protein. The Sf-/BV system produces protein-based antigens that are properly folded and modified, which can be critical for functional, protective immunity. Our testing shows this results in a highly immunogenic nanoparticle that is ready to be formulated with Matrix-M adjuvant. Matrix-M Adjuvant ® Our proprietary Matrix-M adjuvant is a key differentiator within our platform. This adjuvant has enabled potent, well tolerated, and durable efficacy by stimulating the entry of antigen presenting cells (“APCs”) into the injection site and enhancing antigen presentation in local lymph nodes. This in turn activates APCs, T-cell and B-cell populations, and plasma cells, which promote the production of high affinity antibodies, an immune boosting response. This potent mechanism of action enables a lower dose of antigen to achieve the desired immune response, thereby contributing to increased vaccine supply and manufacturing capacity. These immune-boosting and dose-sparing capabilities contribute to the adjuvant’s highly unique profile. 29 We continue to evaluate commercial opportunities for the use of our Matrix-M adjuvant alongside vaccine antigens produced by other manufacturers. Matrix-M adjuvant is being evaluated in combination with several partner-led malaria vaccine candidates, including for R21/Matrix-M adjuvant malaria vaccine. The R21/Matrix-M adjuvant malaria vaccine has been licensed to SII for commercialization. In May 2024, pursuant to the Sanofi CLA, Sanofi received a non-exclusive license to develop and commercialize other vaccine products that include our Matrix-M adjuvant. In September 2024, we signed a Matrix-M adjuvant related agreement with a leading pharmaceutical company to enable exploration of our technology for the potential advancement of their pipeline candidates. In the first quarter of 2025, we signed two additional material transfer agreements to explore the use of Matrix-M adjuvant. COVID-19 Vaccine Regulatory and Licensure In May 2025, the U.S. FDA approved the BLA for Nuvaxovid for active immunization to prevent COVID-19 caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2) in adults 65 years and older and individuals 12 through 64 years who have at least one underlying condition that puts them at high risk for severe outcomes from COVID-19 (e.g. asthma, cancer, diabetes, obesity, smoking). The BLA approval was based on pivotal Phase 3 clinical trial data that showed Nuvaxovid was safe and effective for the prevention of COVID-19. The BLA approval triggered a $175 million milestone payment under the Sanofi CLA. Product Pipeline We are advancing our pipeline of late- and early-stage programs with a focus on potentially high-value assets in areas with unmet medical need, compelling scientific rationale and strong commercial opportunity. Development and advancement of our in-house pipeline leverages our core expertise and our experience in respiratory and infectious diseases and vaccines, and we intend to explore new opportunities with the potential to expand beyond infectious diseases. Our partnered pipeline includes our COVID-19 Vaccine and our Matrix-M adjuvant used in collaboration for development of new and existing vaccines. 30 Pipeline Overview Our pipeline encompasses vaccine candidates for infectious diseases. Our COVID-19 Vaccine, partnered with Sanofi, is our most advanced product. In 2025 and continuing during the term of the Sanofi CLA, Sanofi will lead commercialization efforts for our COVID-19 Vaccine. Our COVID-19 Vaccine has received authorizations from the U.S. FDA, the European Commission (“EC”), the World Health Organization (“WHO”) and several other countries for both adult and adolescent populations. Beyond our COVID-19 Vaccine, our late-stage pipeline includes a CIC vaccine candidate, and our stand-alone influenza vaccine candidate. Additionally, we intend to develop our early-stage pipeline using a disciplined and capital-efficient approach. Our R&D investment strategy seeks to place targeted investments on the programs with the highest potential value, both within infectious disease and beyond, with the intent of partnering these programs at proof of concept. We would consider advancing a program ourselves where data and commercial landscape indicate a unique high-value opportunity. We are actively developing an H5N1 avian pandemic influenza vaccine candidate and pursuing funding opportunities to join preparedness options. We are conducting early-stage research in diseases such as, RSV combinations, shingles and C. Diff. Lastly, we are evaluating potential expansion beyond infectious diseases, where we believe our technology has the potential to augment and improve upon current therapies. In the first quarter of 2025, we entered into a preclinical collaboration with a partner to explore the application and utility of Matrix-M adjuvant with their cancer vaccine candidate. In addition to our own pipeline, we have several partnership opportunities. For example, our Matrix-M adjuvant is being used for collaboration in R21/Matrix-M adjuvant malaria vaccine. Under our agreement, we have also provided a sole license to Sanofi for the independent development of a COVID-19 and influenza combination product using our COVID-19 Vaccine in combination with two of Sanofi’s separately marketed influenza vaccines, Fluzone High-Dose and Flublok, to evaluate immunogenicity and safety in Phase 1/2 combination vaccine trials. These two combination vaccine candidates were granted Fast Track designation by the U.S. FDA in December 2024 to prevent influenza and COVID-19 infections in individuals aged 50 and older. Sanofi also has a non-exclusive license to develop and commercialize combination products containing both our COVID-19 Vaccine and one or more non-influenza vaccines, and a non-exclusive license to develop and commercialize other vaccine products selected by Sanofi that include our Matrix-M adjuvant. Coronavirus Vaccine Clinical Development We continue to evaluate vaccine safety, immunogenicity, and effectiveness through ongoing clinical trials and collaborative evidence-generating real-world studies. 31 Phase 3 Strain-Change and Re-vaccination Studies In October 2024, we initiated and fully enrolled Study 315 to evaluate safety and immunogenicity of a single dose of the JN.1 subvariant vaccine NVX-CoV2705 in previously vaccinated adults. Topline data from this study was submitted to the U.S. FDA in February 2025 and showed that our JN.1 vaccine induced robust cross-reactive neutralizing activity to the JN.1 variant and to a panel of JN.1 lineage strains representing virtually all of those that circulated in the U.S. during the 2024-2025 respiratory virus se ason. We conduct testing against newly emerging strains as we prepare for the annual vaccination season, and this testing informs future strain formulations. We expect to conduct an additional study, Study 318, evaluating the safety and immunogenicity of the JN.1 vaccine in the US-approved population of individuals 12 through 64 years of age with at least one underlying condition that puts them at high risk for severe outcomes from COVID‑19 and in adults ≥ 65 years of age starting in the fourth quarter of 2025. Phase 2b/3 Pediatric Hummingbird™ Trial In December 2024, we achieved the $50 million milestone under our agreement with Sanofi, associated with the database lock for one of the three cohorts in this trial. In August 2023, we announced topline results from our Phase 2b/3 Hummingbird™ trial that met its primary endpoints in children aged 6 through 11 years demonstrating both tolerability and immunologic responses. This ongoing trial is evaluating the safety, effectiveness (immunogenicity), and efficacy of two doses of our prototype COVID-19 Vaccine (NVX-CoV2373), followed by a booster 6 months after the primary vaccination series. The trial completed enrollment in September 2023 and includes three age de-escalation cohorts of 1,200 children each. Safety follow up is expected to be completed in October 2025. The U.S. FDA has informed us that, due to changes in pediatric sero-epidemiology that have occurred since trial initiation, an additional immunogenicity study will be needed to support a supplemental BLA to expand the pediatric indication. We continue to engage with Sanofi to assess the feasibility of achieving an expanded indication in the U.S. given recent policy changes impacting the indicated pediatric population for COVID-19 vaccines. Phase 4 Postmarketing Commitment Clinical Efficacy and Safety Trial In May 2025, we announced that the U.S. FDA, as a part of its BLA approval, requested a PMC to conduct a Phase 4 prospective, randomized, double-blinded, placebo-controlled efficacy and safety trial in individuals aged 50 through 64 without high-risk conditions for severe COVID-19. We are working closely with the U.S. FDA and Sanofi to finalize the trial design, with plans to initiate enrollment in the fourth quarter of 2025. The Company will be responsible to conduct the PMC trial. Sanofi will reimburse the Company for 70% of the PMC costs, capped at the currently agreed upon cost estimates. The Company will recognize cost reimbursements from Sanofi related to the PMC in licensing, royalties, and other revenue over time using an input method, consistent with Sanofi Transition Services and Sanofi Technology Transfer. COVID-Influenza Combination and Stand-alone Influenza Program Phase 3 Clinical Trial of CIC and Stand-alone Influenza Vaccine Candidates In December 2024, we initiated a Phase 3 immunogenicity and safety trial for our CIC and stand-alone influenza vaccine candidates to evaluate the immunogenicity and safety compared to our updated COVID-19 Vaccine and a licensed seasonal influenza vaccine comparator in adults aged 65 and older. Our Phase 3 immunogenicity and safety trial completed enrollment with an initial cohort of approximately 2,000 participants. In June 2025, we reported data from this initial cohort, which showed both vaccine candidates induced robust immune responses across all antigens tested. Both vaccine candidates were well tolerated with reactogenicity profiles that were comparable to authorized comparators. After consultation with the U.S. FDA, we determined that seeking an accelerated approval pathway for our CIC and stand-alone influenza candidates would not be feasible. While the Phase 3 immunogenicity and safety trial is not a pivotal study, the data will inform a future registrational Phase 3 program. We do not intend to make additional investments in these programs and are seeking a partner to advance both vaccine candidates. We continue to invest in development of our pipeline that uses our recombinant nanoparticle technology platform and Matrix-M adjuvant. We continue to believe these assets are key value drivers that would enable the generation of additional vaccine candidates. 32 R21/Matrix-M Adjuvant Malaria Vaccine R21/Matrix-M adjuvant malaria vaccine, formulated with our Matrix-M adjuvant is developed by our partner, the Jenner Institute, University of Oxford, and manufactured by SII. We have an agreement with SII related to its manufacture of R21/Matrix-M adjuvant malaria vaccine under which SII purchases our Matrix-M adjuvant for use in development activities at cost and for commercial purposes at a tiered commercial supply price, and pays a royalty in the single- to low-double digit range based on vaccine sales for a period of 15 years after the first commercial sale of the vaccine in each country. In July 2024, first commercial doses of R21/Matrix-M adjuvant malaria vaccine have been administered to children in Cote d’Ivoire and South Sudan. As part of the WHO malaria program, at their discretion, the vaccine is expected to be included in countries such as Central African Republic, Chad, Democratic Republic of Congo, Mozambique, Nigeria and Uganda. In December 2023, the WHO announced it prequalified the R21/Matrix-M adjuvant malaria vaccine to prevent malaria disease in children caused by the P. falciparum parasite in endemic areas. Prequalification status enables United Nations agencies to procure the vaccine for eligible countries and enabled rollout of the vaccine in mid-2024. The WHO recommended that the R21/Matrix-M adjuvant malaria vaccine be administered in a four-dose schedule beginning at five months of age. Business Highlights Second Quarter 2025 and Recent Highlights Strategic Priority #1: Sanofi Partnership • In May 2025, the U.S. FDA approved the Nuvaxovid™ BLA for prevention of COVID-19 in adults 65 years and older and individuals aged 12 through 64 years who have at least one underlying condition that puts them at high risk for severe outcomes from COVID-19. ◦ BLA approval triggered a $175 million milestone payment from Sanofi. • Completed transition of Nuvaxovid commercial leadership in the U.S. to Sanofi for the 2025-2026 COVID-19 vaccination season. • Transfers of marketing authorization to Sanofi for U.S. and European Union (EU) markets are expected in the fourth quarter of 2025 which will trigger an additional $50 million in combined milestones from Sanofi. Strategic Priority #2: Enhance Existing Partnerships and Leverage our Technology Platform and Pipeline to Forge Additional Partnerships • In June 2025, we reported initial cohort data for the Phase 3 trial for our CIC and stand-alone seasonal influenza vaccine candidates, showing robust immune responses for both candidates. This descriptive data set will help inform a potential future registrational Phase 3 program. Novavax intends to partner these programs and this trial reflects the completion of material investment by Novavax. Discussions are ongoing with potential partners for these late-stage assets. ◦ New T-cell response data in both CIC and stand-alone influenza vaccine candidates were numerically higher than the Fluzone HD comparator arm indicating the potential for an increased duration of protection. • In May 2025, Novavax and Takeda Pharmaceuticals announced significantly improved terms for their partnership to support ongoing commercialization of Nuvaxovid in Japan. Takeda filed for approval of the updated Nuvaxovid vaccine in June and is on track to be on the market for the fall respiratory season in Japan. • R21/Matrix-M ® , a malaria vaccine developed in partnership with Serum Institute of India and Oxford University, continued to make meaningful progress in addressing the urgent and unmet needs of malaria-endemic regions with 20 million doses sold since launch in mid-2024. • In the first quarter of 2025, Novavax announced material transfer agreements with three pharmaceutical companies to explore the utility of Matrix-M in their portfolios. These arrangements have led to discussions with potential business partners to develop new vaccines and improve existing vaccines. 33 Strategic Priority #3: Advance our Technology Platform and Early-stage Pipeline • In July 2025, we announced preclinical data demonstrating that Novavax’s H5N1 avian pandemic influenza vaccine candidate induced robust immune responses by either single or two-dose intranasal or intramuscular administration in primed non-human primates. The results were published in Nature Communications. • Continued advancement of early-stage preclinical research for H5N1 avian pandemic influenza, respiratory syncytial virus combinations, shingles and Clostridioides difficile colitis vaccine candidates. • Generated preliminary positive data using Matrix-M with an oncology vaccine candidate with potential future application across several tumor types. • Continued work on new potential Matrix formulations intended to improve upon and expand the utility of Matrix-M. Sales of Common Stock In August 2023, we entered into an At Market Issuance Sales Agreement (the “August 2023 Sales Agreement”), which allows us to issue and sell up to $500 million in gross proceeds of shares of our common stock, and terminated our then-existing At Market Issuance Sales agreement entered in June 2021. During the three and six months ended June 30, 2025, no sales were recorded under the August 2023 Sales Agreement. During the three and six months ended June 30, 2024, we sold 12.2 million shares of our common stock resulting in net proceeds of approximately $188 million, under the August 2023 Sales Agreement. As of June 30, 2025, the remaining balance available under the August 2023 Sales Agreement was approximately $51 million. In May 2024, the Company entered into the Subscription Agreement, pursuant to which the Company sold and issued to Sanofi, in a private placement, 6,880,481 shares of the Company’s common stock, par value $0.01 per share at a price of $10.00 per share for aggregate gross proceeds to the Company of $68.8 million. Critical Accounting Policies and Use of Estimates The discussion and analysis of our financial condition and results of operations are based upon our accompanying unaudited financial statements and the unaudited accompanying notes, which have been prepared in accordance with generally accepted accounting principles in the United States. The preparation of our consolidated financial statements requires us to make estimates, assumptions, and judgments that affect the reported amounts of assets, liabilities, and equity and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Our critical accounting policies and estimates are included under Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, as filed with the SEC. Recent Accounting Pronouncements Not Yet Adopted See “Note 2―Summary of Significant Accounting Policies” included in our Notes to Consolidated Financial Statements (Unaudited) (under the caption “ Recent Accounting Pronouncements ”). Results of Operations The following is a discussion of the historical financial condition and results of our operations that should be read in conjunction with the unaudited consolidated financial statements and notes set forth in this Quarterly Report. Our historical results are not necessarily indicative of the results for any periods in the future. 34 Three Months Ended June 30, 2025 and 2024 Revenue Three Months Ended June 30, 2025 2024 Change Revenue (in thousands): Product sales $ 10,724 $ 22,588 $ (11,864) Licensing, royalties, and other 228,516 392,896 (164,380) Total revenue $ 239,240 $ 415,484 $ (176,244) Revenue for the three months ended June 30, 2025 was $239.2 million as compared to $415.5 million for the same period in 2024, a decrease of $176.2 million. Revenue for the three months ended June 30, 2025 was primarily comprised of licensing revenue from the achievement of milestones and transition services and technology transfer under the Sanofi CLA and licensing and royalty revenue with Takeda. Revenue for the three months ended June 30, 2024 was primarily comprised of revenue from licensing revenue under the Sanofi CLA. The decrease in revenue is primarily due to a decrease in licensing revenue under the Sanofi CLA. Product sales Product sales for the three months ended June 30, 2025 were $10.7 million as compared to $22.6 million for the same period in 2024, a decrease of $11.9 million. Our Product sales related to revenue from Nuvaxovid sales, which commenced in 2022, commercial supply sales of COVID-19 Vaccine, and revenue from supply of adjuvant and other products. The categories of Product sales were as follows: Three Months Ended June 30, 2025 2024 Change Product sales (in thousands) Nuvaxovid sales (1) $ (2,093) $ 19,904 $ (21,997) Supply sales (2) 12,817 2,684 10,133 Total Product sales $ 10,724 $ 22,588 $ (11,864) (1) Nuvaxovid sales are sales of our COVID-19 Vaccine associated with APAs with various governments globally and commercial markets, where we are the commercial lead for sales and distribution, made through pharmaceutical wholesale distributors. During the three months ended June 30, 2025, Nuvaxovid sales include excess gross-to-net deductions primarily due to updates to estimated product returns. (2) Supply sales include commercial sales of COVID-19 Vaccine, adjuvant sales, and sale of other materials to our partners. We reclassified $2.7 million of revenue previously reported as License, royalties, and other revenue to Product sales revenue for the three months ended June 30, 2024 related to adjuvant supply sales and other supply sales. Licensing, royalties, and other Licensing, royalties, and other revenue during the three months ended June 30, 2025 was $228.5 million as compared to $392.9 million during the same period in 2024, a decrease of $164.4 million. The decrease was primarily due to a decrease in licensing revenue under the Sanofi CLA. Licensing, royalties, and other revenue were comprised of the following: 35 Three Months Ended June 30, 2025 2024 Change Licensing, royalties, and other (in thousands) Sanofi $ 199,412 $ 392,896 $ (193,484) Takeda 27,212 — 27,212 Other partners (1) 1,892 — 1,892 Total licensing, royalties, and other revenue $ 228,516 $ 392,896 $ (164,380) (1) Other partners revenue includes royalties and license fees associated with agreements with other partners such as Serum and SK bioscience, Co., Ltd. Sanofi licensing, royalties, and other revenue were comprised of the following: Three Months Ended June 30, 2025 2024 Change Sanofi licensing, royalties, and other revenue (in thousands) Licensing: Upfront fee $ — $ 386,250 $ (386,250) Milestones 175,000 — 175,000 Transition services and technology transfer: Upfront fee amortization (1) 12,268 4,573 7,695 Milestones amortization (1) 5,665 2,073 3,592 Cost reimbursements 6,479 — 6,479 Total Sanofi licensing, royalties, and other revenue $ 199,412 $ 392,896 $ (193,484) 36 (1) Upfront fee amortization and Milestones amortization represent revenue recognized during the period related to a portion of the the $500 million upfront payment and the $50 million milestone for database lock of an existing Phase 2/3 clinical trial in 2024 that were deferred upon achievement and are recognized in revenue over time. Takeda licensing, royalties, and other revenue were comprised of the following (in thousands): Three Months Ended June 30, 2025 2024 Change Takeda licensing, royalties, and other revenue Licensing: Upfront fee (1) $ 18,500 $ — $ 18,500 Milestones 3,434 — 3,434 Royalties 5,000 — 5,000 Support services 278 — 278 Tota Total Takeda licensing, royalties, and other revenue $ 27,212 $ — $ 27,212 (1) Upfront fee includes $14.5 million of nonrefundable upfront payments associated with the collaboration and exclusive license agreement, as amended with Takeda (“Amended Takeda CLA”) and $4.0 million of previously unrecognized consideration from the collaboration and exclusive license agreement with Takeda (“Original Takeda CLA”). Expenses Three Months Ended June 30, 2025 2024 Change Expenses (in thousands): Cost of sales $ 15,325 $ 46,242 $ (30,917) Research and development 79,233 106,946 (27,713) Selling, general, and administrative 43,612 101,298 (57,686) Total expenses $ 138,170 $ 254,486 $ (116,316) Cost of Sales Cost of sales was $15.3 million for the three months ended June 30, 2025, including expenses of $1.1 million related to excess, obsolete, or expired inventory and $1.7 million related to unutilized manufacturing capacity. Cost of sales was $46.2 million for the three months ended June 30, 2024, including expense of $11.4 million related to excess, obsolete, or expired inventory and losses on firm purchase commitments and $12.9 million related to unutilized manufacturing capacity. The decrease in cost of sales of $30.9 million was mainly driven by a decrease in the number of COVID-19 Vaccine doses sold, a decrease in excess, obsolete, and expired inventory charges, and a decrease in unutilized manufacturing capacity charges. The cost of sales as a percentage of Product sales may fluctuate in the future as a result of changes to our customer pricing mix or standard costs. Research and Development Expenses Research and development expenses were $79.2 million for the three months ended June 30, 2025 as compared to $106.9 million for the three months ended June 30, 2024, a decrease of $27.7 million. The decrease was primarily due to a reduction in overall expenditures relating to development activities on coronavirus vaccines, including our COVID-19 Program, 37 and CIC, and due to certain cost containment measures to reduce our operating spend, as summarized in the table below (in thousands): Three Months Ended June 30, 2025 2024 Coronavirus vaccines $ 20,194 $ 40,812 Other vaccine development programs 842 400 Total direct external research and development expense 21,036 41,212 Employee expenses 32,648 36,238 Stock-based compensation expense 3,501 6,177 Facility expenses 12,665 12,914 Other expenses 9,383 10,405 Total research and development expenses $ 79,233 $ 106,946 Research and development expenses for coronavirus vaccines for the three months ended June 30, 2025 and 2024 decreased from $40.8 million to $20.2 million primarily as a result of our global restructuring and cost reduction efforts and a reduction in manufacturing and support costs due, in part, to a reduction in our global manufacturing footprint consistent with our contractual obligations to supply, and anticipated demand for, COVID-19 Vaccine, under manufacturing supply agreements with CMOs and contract manufacturing and development organizations (“CDMOs”). Selling, General, and Administrative Expenses Selling, general, and administrative expenses were $43.6 million for the three months ended June 30, 2025 as compared to $101.3 million for the same period in 2024, a decrease of $57.7 million. The decrease in selling, general, and administrative expenses is primarily due to certain cost containment measures to reduce our operating spend, including a reduction in our global commercial footprint and administrative infrastructure and the sale of the Novavax CZ manufacturing facility in December 2024. For the remainder of 2025, we expect a reduction in our annual combined research and development, and selling, general, and administrative spend as a result of our Restructuring Plan as discussed in Note 16 to our accompanying unaudited consolidated financial statements. Other Income (Expense) Three Months Ended June 30, 2025 2024 Change Other income (expense), net (in thousands): Interest expense $ (5,518) $ (4,143) $ (1,375) Other income (expense), net 11,902 7,731 4,171 Total other income (expense), net $ 6,384 $ 3,588 $ 2,796 Total other income (expense), net was $6.4 million of income for the three months ended June 30, 2025 as compared to a total other income (expense), net of $3.6 million of income for the same period in 2024. The increase in other income (expense), net is primarily due to changes in foreign currency transaction gains during the period, offset by a decrease in interest income during the period from lower cash and marketable securities balances. Income Tax Expense During the three months ended June 30, 2025, we recognized income tax expense of $0.9 million related to federal, state, and foreign income taxes, and foreign withholding tax expense. During the three months ended June 30, 2024, we recognized an income tax expense of $2.2 million related to federal, state, and foreign income taxes. 38 Net Income Three Months Ended June 30, 2025 2024 Change Net Income (in thousands, except per share information): Net income $ 106,508 $ 162,381 $ (55,873) Net income per share, basic $ 0.66 $ 1.09 $ (0.43) Net income per share, diluted $ 0.62 $ 0.99 $ (0.37) Weighted average shares outstanding, basic 162,019 148,379 13,640 Weighted average shares outstanding, dilutive 177,215 165,855 11,360 Net income for the three months ended June 30, 2025 was $106.5 million, or $0.66 per share, basic and $0.62 per share, dilutive, as compared to net income of $162.4 million, or $1.09 per share, basic and $0.99 per share dilutive, for the same period in 2024. The decrease in net income during the three months ended June 30, 2025, was primarily due to a decrease in total revenue partially offset by a decrease in total expenses. The increase in weighted average shares outstanding for the three months ended June 30, 2025, was primarily a result of sales of our common stock in 2024 and common stock issued under our incentive programs. Six Months Ended June 30, 2025 and 2024 Revenue Six Months Ended June 30, 2025 2024 Change Revenue (in thousands): Product sales $ 632,402 $ 112,424 $ 519,978 Licensing, royalties, and other 273,493 396,915 (123,422) Total revenue $ 905,895 $ 509,339 $ 396,556 Revenue for the six months ended June 30, 2025 was $905.9 million as compared to $509.3 million for the same period in 2024, an increase of $396.6 million. Revenue for the six months ended June 30, 2025 was primarily comprised of revenue from the termination of our APAs with Canada (“Canada APA”) and New Zealand (“New Zealand APA”) of $575.7 million and $27.3 million, respectively, licensing revenue from the achievement of milestones under the Sanofi CLA, the recognition of previously deferred upfront payments and revenue from transition services and technology transfer under the Sanofi CLA, and licensing and royalty revenue with Takeda. Revenue for the six months ended June 30, 2024 was primarily comprised of revenue from licensing revenue under the Sanofi CLA and Product sales of COVID-19 Vaccine. The increase in revenue is primarily due to an increase in Product sales from the termination of our Canada and New Zealand APAs, partially offset by a decrease in licensing, royalties, and other revenue from the Sanofi CLA. Product sales Product sales for the six months ended June 30, 2025 were $632.4 million as compared to $112.4 million during the six months ended June 30, 2024, an increase of $520.0 million. Our Product sales related to revenue from Nuvaxovid sales, 39 which commenced in 2022, commercial supply sales of COVID-19 Vaccine, revenue from supply of adjuvant and other products, and the termination of our Canada and New Zealand APAs. The categories of Product sales were as follows: Six Months Ended June 30, 2025 2024 Change Product sales (in thousands) Nuvaxovid sales (1) $ 605,931 $ 102,228 $ 503,703 Supply sales (2) 26,471 10,196 16,275 Total Product sales $ 632,402 $ 112,424 $ 519,978 (1) Nuvaxovid sales are sales of our COVID-19 Vaccine associated with APAs with various governments globally and commercial markets, where we are the commercial lead for sales and distribution, made through pharmaceutical wholesale distributors. (2) Supply sales include commercial sales of COVID-19 Vaccine, adjuvant sales, and sale of other materials to our partners. We reclassified $10.2 million of revenue previously reported as License, royalties, and other revenue to Product sales revenue for the six months ended June 30, 2024 related to adjuvant supply sales and other supply sales. Licensing, royalties, and other Licensing, royalties, and other revenue during the six months ended June 30, 2025 was $273.5 million as compared to $396.9 million during the same period in 2024, a decrease of $123.4 million. The decrease was primarily due to a decrease in revenue under the Sanofi CLA, offset by an increase in revenue from other partners, including the Amended Takeda CLA. Licensing, royalties, and other revenue were comprised of the following: Six Months Ended June 30, 2025 2024 Change Licensing, royalties, and other (in thousands) Sanofi $ 239,733 $ 392,896 $ (153,163) Takeda 27,212 — 27,212 Other partners (1) 6,548 4,019 2,529 Total licensing, royalties, and other revenue $ 273,493 $ 396,915 $ (123,422) (1) Other partners revenue includes royalties and license fees associated with agreements with other partners such as Serum and SK bioscience, Co., Ltd. Sanofi licensing, royalties, and other revenue were comprised of the following: Six Months Ended June 30, 2025 2024 Change Sanofi licensing, royalties, and other revenue (in thousands) Licensing: Upfront fee $ — $ 386,250 $ (386,250) Milestones 175,000 — 175,000 Transition services and technology transfer: Upfront fee amortization (1) 32,180 4,573 27,607 Milestones amortization (1) 14,808 2,073 12,735 Cost reimbursements 17,745 — 17,745 Total Sanofi licensing, royalties, and other revenue $ 239,733 $ 392,896 $ (153,163) 40 (1) Upfront fee amortization and Milestones amortization represent revenue recognized during the period related to a portion of the the $500 million upfront payment and the $50 million milestone for database lock of an existing Phase 2/3 clinical trial in 2024 that were deferred upon achievement and are recognized in revenue over time. Takeda licensing, royalties, and other revenue were comprised of the following (in thousands): Six Months Ended June 30, 2025 2024 Change Takeda licensing, royalties, and other revenue Licensing: Upfront fee (1) $ 18,500 $ — $ 18,500 Milestones 3,434 — 3,434 Royalties 5,000 — 5,000 Support services 278 — 278 Tota Total Takeda licensing, royalties, and other revenue $ 27,212 $ — $ 27,212 (1) Upfront fee includes $14.5 million of nonrefundable upfront payments associated with the Amended Takeda CLA and $4.0 million of previously unrecognized consideration from the Original Takeda CLA. Expenses Six Months Ended June 30, 2025 2024 Change Expenses (in thousands): Cost of sales $ 29,439 $ 105,451 $ (76,012) Research and development 168,170 199,625 (31,455) Selling, general, and administrative 91,702 188,096 (96,394) Total expenses $ 289,311 $ 493,172 $ (203,861) Cost of Sales Cost of sales was $29.4 million for the six months ended June 30, 2025, including expenses of $1.4 million related to excess, obsolete, or expired inventory and $3.5 million related to unutilized manufacturing capacity. Cost of sales was $105.5 million for the six months ended June 30, 2024, including expense of $20.2 million related to excess, obsolete, or expired inventory and losses on firm purchase commitments and $18.8 million related to unutilized manufacturing capacity. The decrease in cost of sales of $76.0 million was mainly driven by a decrease in the number of COVID-19 Vaccine doses sold, a decrease in excess, obsolete, and expired inventory charges, and a decrease in unutilized manufacturing capacity charges. The cost of sales as a percentage of Product sales may fluctuate in the future as a result of changes to our customer pricing mix or standard costs. 41 Research and Development Expenses Research and development expenses decreased to $168.2 million for the six months ended June 30, 2025 from $199.6 million for the same period in 2024, a decrease of $31.5 million. The decrease was primarily due to a reduction in overall expenditures relating to development activities on coronavirus vaccines, including our COVID-19 Program, and CIC, and due to certain cost containment measures to reduce our operating spend, as summarized in the table below (in thousands): Six Months Ended June 30, 2025 2024 Coronavirus vaccines $ 46,722 $ 65,962 Other vaccine development programs 2,720 736 Total direct external research and development expense 49,442 66,698 Employee expenses 68,270 74,191 Stock-based compensation expense 7,790 11,682 Facility expenses 25,812 24,696 Other expenses 16,856 22,358 Total research and development expenses $ 168,170 $ 199,625 Research and development expenses for coronavirus vaccines for the six months ended June 30, 2025 and 2024 decreased from $66.0 million to $46.7 million primarily as a result of a reduction in manufacturing and support costs due, in part, to a reduction in our global manufacturing footprint consistent with our contractual obligations to supply, and anticipated demand for, COVID-19 Vaccine, and under manufacturing supply agreements with CMOs and CDMOs. Selling, General, and Administrative Expenses Selling, general, and administrative expenses decreased to $91.7 million for the six months ended June 30, 2025 from $188.1 million for the same period in 2024, a decrease of $96.4 million. The decrease in selling, general, and administrative expenses is primarily due to certain cost containment measures to reduce our operating spend, including a reduction in our global commercial footprint and administrative infrastructure and the sale of the Novavax CZ manufacturing facility in December 2024. Other Income (Expense) Six Months Ended June 30, 2025 2024 Change Other income (expense), net (in thousands): Interest expense $ (11,241) $ (8,254) $ (2,987) Other income 21,957 11,385 10,572 Total other income (expense), net $ 10,716 $ 3,131 $ 7,585 Total other income (expense), net for the six months ended June 30, 2025 was $10.7 million of income as compared to $3.1 million of income for the same period in 2024, an increase of $7.6 million. The increase in other income (expense) is primarily due to changes in foreign currency transaction gains during the period, offset by a decrease in interest income during the period from lower cash and marketable securities balances. Income Tax Expense During the six months ended June 30, 2025, we recognized an income tax expense of $2.1 million related to federal, state, and foreign income taxes and foreign withholding taxes. During the six months ended June 30, 2024, we recognized an income tax expense of $4.5 million related to federal, state, and foreign income taxes. 42 Net Income Six Months Ended June 30, 2025 2024 Change Net Income (in thousands, except per share information): Net Income $ 625,154 $ 14,831 $ 610,323 Net Income per share, basic $ 3.87 $ 0.10 $ 3.77 Net income per share, dilutive $ 3.55 $ 0.10 $ 3.45 Weighted average shares outstanding, basic 161,536 144,147 17,389 Weighted average shares outstanding, dilutive 177,410 145,121 32,289 Net income for the six months ended June 30, 2025 was $625.2 million, or $3.87 per share, basic and $3.55 per share, dilutive, as compared to net income of $14.8 million, or $0.10 per share, basic and $0.10 per share dilutive, for the same period in 2024. The increase in net income during the six months ended June 30, 2025, was primarily due to an increase in total revenue and a decrease in total expenses. The increase in weighted average shares outstanding for the six months ended June 30, 2025 is primarily a result of sales of our common stock in 2024 and common stock issued under our incentive programs. Liquidity Matters and Capital Resources Our future capital requirements depend on numerous factors including, but not limited to, revenue from our Product sales, milestone payments, royalties, and reimbursements under licensing arrangements with our strategic partners; our projected activities related to the development and commercial support of our COVID-19 Vaccine and our CIC and stand-alone influenza vaccine candidates, including significant commitments under various clinical research organizations, CMO, and CDMO agreements; the progress of preclinical studies and clinical trials; the time and costs involved in obtaining and maintaining regulatory approvals; the costs of filing, prosecuting, defending, and enforcing patent claims and other intellectual property rights; and other manufacturing, sales, and distribution costs. We plan to continue developing other vaccines and product candidates, such as our potential combination vaccine candidates, which are in various stages of development. Our ability to generate revenue from Product sales is subject to uncertainty specifically as it relates to our ability to successfully develop, manufacture, distribute, and market our updated vaccine and to successfully execute on our licensing arrangements with our strategic partners and our APAs, as discussed below. Additionally, our plans include our ongoing restructuring and cost reduction measures as a part of our Restructuring Plan (see Note 16 to our accompanying unaudited consolidated financial statements), and may also include raising additional capital through a combination of additional equity and debt financing, collaborations, strategic alliances, asset sales, and marketing, distribution, or licensing arrangements. New financings may not be available to us on commercially acceptable terms, or at all. If we are unable to obtain additional capital, we will assess our capital resources and may be required to delay, reduce the scope of, or eliminate some or all of our operations, or further downsize our organization, any of which may have a material adverse effect on our business, financial condition, results of operations. Sanofi Collaboration and License Agreement In May 2024, we entered into the Sanofi CLA pursuant to which we received a non-refundable upfront payment of $500 million. During the quarter ended June 30, 2025, we received a milestone payment of $50 million for database lock of an existing Phase 2/3 clinical trial in 2024, achieved the $175 million milestone upon the approval of the marketing authorization for a COVID-19 Vaccine Product in a pre-filled syringe from the U.S. FDA. We expect to receive the $175.0 million milestone payment in the three months ended September 2025. We are eligible to receive additional development, technology transfer, launch, and sales milestone payments totaling up to $475 million in the aggregate with respect to the Licensed COVID-19 Products and royalty payments on Sanofi’s sales of such licensed products. In addition, we are eligible to receive development, launch, and sales milestone payments of up to $200 million for each of the first four adjuvant Products and $210 million for each adjuvant Product thereafter, and royalty payments on Sanofi’s sales of all such licensed products. Remaining Sanofi sales milestone payments of $475 million include $125 million related to COVID-19 Vaccine Products and $350 million related to influenza-COVID-19 combination products. The COVID-19 Vaccine Products milestones remaining include a $25 million upon the transfer of the U.S. MAH to Sanofi, $25 million upon the transfer of the European Medicines Agency (“EMA”) MAH in a pre-filled syringe to Sanofi, and $75 million upon the completion of the technology 43 transfer of our manufacturing process for the COVID-19 Vaccine Products to Sanofi. The influenza-COVID-19 combination product milestones include a $125 million milestone upon achievement of certain influenza-COVID-19 combination products-related development milestones, and a $225 million in influenza-COVID-19 combination products-related launch milestones. Beginning in 2025 and continuing during the term of the Sanofi CLA, we and Sanofi expect to commercialize the COVID-19 Vaccine Products worldwide in accordance with a commercialization plan agreed by us and Sanofi, under which we will continue to supply our existing APA customers and strategic partners, including Takeda and SII. Upon completion of the existing APAs, we and Sanofi will jointly agree on commercialization activities of each party in each jurisdiction. Takeda Amended and Restated Collaboration and License Agreement On April 29, 2025, we entered into the Amended Takeda CLA which amends and supersedes the Original Takeda CLA. We determined the initial transaction price at inception of the Amended Takeda CLA to be $27.5 million, consisting of (i) $19.5 million of the non-refundable upfront payment, (ii) $4.0 million of non-cancelable annual support payments within the 18 month notice period for contract termination, and (iii) $4.0 million of previously unrecognized consideration from the Original Takeda CLA. We allocated $26.9 million of fixed consideration to the Updated Takeda License performance obligations and $0.6 million to Takeda Support Services. We recognized revenue of $26.9 million related to the Updated Takeda License on the transfer of the rights and control of the license to Takeda during the three and six months ended June 30, 2025. The Takeda Support Services are recognized in revenue over time using an input method to measure progress by utilizing costs incurred to-date relative to total expected costs. Revenue recognized related to Takeda support Services for the three and six months ended June 30, 2025 was $0.3 million. Under the Amended Takeda CLA, we will receive a non-refundable upfront payment of $19.5 million of which $5.0 million is creditable against royalties owed by Takeda for its fiscal year 2024. In addition, on an annual basis, we will receive $2.0 million to compensate us for services provided by us under the Takeda CLA, and we will receive an additional $8.0 million annual milestone payment, of which $5.0 million is creditable against royalties owed by Takeda in its fiscal year 2025 or thereafter, if Takeda receives marketing approval of the COVID-19 Vaccine in that year or such approval is not necessary for such year. The parties have also updated the financial terms to replace the share of operating profits and, instead, provide us with a tiered royalty as a percentage of Takeda’s, its affiliates’ and sublicensees’ total net sales in the mid to high-teen percentages (subject to certain capped royalty reductions), which commenced on April 1, 2024 and will continue until the latest of (a) twenty years after April 29, 2025, (b) all our know-how licensed under the Amended Takeda CLA has become publicly available through no fault of Takeda, and (c) the expiration of the last valid claim in the intellectual property rights licensed by us to Takeda under the Amended Takeda CLA covering COVID-19 Vaccine in Japan. In connection with the Amended Takeda CLA, on April 29, 2025, we entered into a release agreement with Takeda under which we released Takeda and Takeda released us from all claims that were asserted or could have been asserted by either party against the other party that related to the Original Takeda CLA and the activities thereunder. Supply Agreements As of June 30, 2025, we have $222.1 million of remaining obligations under APAs with certain countries globally, excluding the Vaccine Alliance (“Gavi”). These obligation include $133.9 million related to an APA with the Commonwealth of Australia for the purchase of doses of COVID-19 Vaccine (the “Australia APA”) and $88.2 million related to various other countries. With respect to the Australia APA, as of June 30, 2025, $31.2 million was classified as current Deferred revenue and $102.6 million was classified as non-current Deferred revenue in our consolidated balance sheet. Following the withdrawal of our application at the request of the Therapeutic Goods Administration (“TGA”) for authorization of our updated COVID-19 Vaccine, we are in discussions with the TGA, regarding potential regulatory paths for approval, including the submission of a new application. We may seek to further amend the Australian APA in light of this development, which amendment may not be achievable on acceptable terms or at all. In the event that we do not, on or before the relevant contractual deadlines, receive regulatory approval for, and deliver, the seasonally updated COVID-19 Vaccine, up to $92.5 million of deferred revenue may become refundable. Specifically, Australia may cancel doses that are due to be delivered in 2025 if we do not receive regulatory approval for, and deliver, the updated COVID-19 Vaccine on or before December 31, 2025, and may terminate the Australia APA, as amended, if we do not receive regulatory approval for, and deliver, the updated COVID-19 Vaccine on or before March 31, 2026. With respect to other obligations under APAs of $88.2 million, as of June 30, 2025, $38.4 million was classified as current Deferred revenue, $49.8 million was classified as non-current Deferred revenue in our consolidated balance sheet. Recognition of these amounts is dependent on delivery of doses or expiry of optional dose order quantities. 44 In November 2024, we entered into a settlement agreement with the Secretary of State for Business, Energy and Industrial Strategy (as assigned to the UK Health Security Agency), acting on behalf of the government of the United Kingdom of Great Britain and Northern Ireland (the “Authority”), pursuant to which we and the Authority agreed to terminate the Amended and Restated Supply Agreement with the Authority and to fully settle the outstanding amount under dispute related to upfront payments of $112.5 million. We agreed to pay a refund of $123.8 million including interest of $11.3 million to the Authority in equal quarterly installments of $10.3 million over a three year period, ending in June 2027. As of June 30, 2025, pursuant to our settlement agreement with the UK, the remaining upfront payment previously received from the authority is classified as $37.5 million of other current liabilities and $39.8 million of Other non-current liabilities on our consolidated balance sheet. In February 2024, we and Gavi entered into a Termination and Settlement Agreement (the “Gavi Settlement Agreement”) terminating our APA with Gavi (the “Gavi APA”). In total, the Gavi settlement agreement is comprised of $700 million of potential consideration, consisting of the $75 million initial settlement payment, deferred payments of up to $400 million that may be reduced through annual vaccine credits, and an additional credit of up to $225 million that may be applied against certain qualifying sales. As of June 30, 2025, the remaining amounts included on our consolidated balance sheet are classified as $225.0 million in non-current Deferred revenue for the additional credit that may be applied against future qualifying sales, $80.0 million in Other current liabilities, and $225.0 million in Other non-current liabilities. In addition, we and Gavi entered into a security agreement pursuant to which we granted Gavi a security interest in accounts receivable from SII under the SII R21 Agreement (see Note 6 to our accompanying unaudited consolidated financial statements), which will continue for the deferred payment term of the Gavi Settlement Agreement. On February 22, 2024, the claims and counterclaims were dismissed with prejudice. Cash Flows As of June 30, 2025, we had $627.5 million in cash and cash equivalents, restricted cash and marketable securities as compared to $938.2 million as of December 31, 2024. We expect to receive $175.0 million in the third quarter of 2025 related to the milestone payment triggered under the Sanofi CLA that is included in Accounts receivable as of June 30, 2025 in the accompanying unaudited financial statements. We funded our operations for the six months ended June 30, 2025 primarily with cash and cash equivalents, milestone payments under the Sanofi CLA and revenue from Product sales. In accordance with our ongoing Restructuring Plan, we continue to restructure our global footprint including further reductions in our global workforce and exploring the use of our real estate portfolio in Gaithersburg, Maryland. We anticipate our future operations to be funded primarily by milestone payments, royalties, transition services and technology transfer and cost reimbursements under our Sanofi CLA, revenue from Product sales, our cash and cash equivalents and investments in marketable securities, and other potential funding sources including equity financings, which may include at the market offerings, debt financings, collaborations, strategic alliances, asset sales, and marketing, distribution or licensing arrangements. The following table summarizes cash flows for the six months ended June 30, 2025 and 2024 (in thousands): Six Months Ended June 30, 2025 2024 Change Net cash provided by (used in): Operating activities $ (312,964) $ 230,714 $ (543,678) Investing activities 37,779 (379,957) 417,736 Financing activities (8,101) 264,102 (272,203) Effect on exchange rate on cash, cash equivalents, and restricted cash 6,976 (3,111) 10,087 Net increase (decrease) in cash, cash equivalents, and restricted cash (276,310) 111,748 (388,058) Cash, cash equivalents, and restricted cash at beginning of period 545,292 583,810 (38,518) Cash, cash equivalents, and restricted cash at end of period $ 268,982 $ 695,558 $ (426,576) Net cash used in operating activities was $313.0 million for the six months ended June 30, 2025, as compared to $230.7 million of cash provided for the same period in 2024. The increase in cash used in operating activities is primarily due to a reduction in cash received from receivables on APA agreements in 2025 as compared to the same period in 2024. 45 Net cash provided by investing activities was $37.8 million for the six months ended June 30, 2025, as compared to $380.0 million of cash used for the same period in 2024. The increase in cash provided by investing activities is primarily due to our investment in marketable securities, partially offset by lower expenditures on equipment and leasehold improvements. Net cash used in financing activities was $8.1 million for the six months ended June 30, 2025, as compared to net cash provided by financing activities of $264.1 million for the same period in 2024. The increase in cash used in financing activities is primarily due to a decrease in net proceeds from sales of common stock, the exercise of stock-based awards, and payment of finance lease liabilities. Going Concern As described in Note 2 to our accompanying unaudited consolidated financial statements, we evaluated our ability to continue as a going concern and concluded that we will have sufficient capital available to fund our operations for at least one-year from the date that the financial statements were issued.