Andrea Flynn - IR Stanley Erck - President and Chief Executive Officer Barclay Phillips - Chief Financial Officer Greg Glenn - President, Research and Development Louis Fries - Chief Medical Officer James Cummings - Senior Director of Clinical Development

Joel Beatty - Citigroup Edward Tenthoff - Piper Jaffray Kevin DeGeeter - Ladenburg Thalmann George Zavoico - JonesTrading

Good day, ladies and gentlemen and welcome to the Novavax Third Quarter Financial Results and Investor and Analyst Update Conference Call. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions] As a reminder this conference is being recorded. I would now like to introduce your host for today's conference, Ms. Andrea Flynn, Associate Director of Investor Relations. Ms. Flynn, you may begin.

Thank you, operator. Good afternoon. This is Andrea Flynn, Associate Director of Investor Relations at Novavax. I would like to thank everyone for joining today’s call to discuss our third quarter 2016 financial results and to provide an investor and analyst update. A press release of our earnings is currently available on our website at novavax.com. An audio archive of this conference call will be available on our website later today. Joining me on today’s call is Novavax’s President and CEO, Stan Erck, together with our President of Research and Development, Dr. Greg Glenn; Chief Medical Officer, Dr. Louis Fries; Senior Director of Clinical Development, Dr. James Cummings; and Chief Financial Officer, Buck Phillips. Before we begin our prepared remarks, I need to remind you that we will be making forward-looking statements during this teleconference that could include financial, clinical or commercial projections. Statements relating to future financial or business performance, conditions or strategies and other financial and business related matters, including expectations regarding revenue, operating expenses, cash usage and clinical developments and anticipated milestones are forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Novavax cautions that these forward-looking statements are subject to numerous assumptions, risks, and uncertainties, which change over time. We have a slightly different agenda for today's call. Buck will start with a quick review of the third quarter financial results, following that we will begin the Investor and Analyst portion of the call with Stan. I'll now turn the call over to Buck.

Thank you, Andrea. Good evening, everyone, and thank you for joining today's call. Today we announced financial results for the third quarter ended September 30, 2016. Summary financial statements can be found in today's earnings press release. For the third quarter of 2016 we recorded a net loss of $66.3 million or $0.24 per share. This compares to a net loss of $33.1 million or $0.12 per share in the prior year period. The increase in net loss in the third quarter of 2016 is primarily the result of increased R&D expenses related to the clinical trials and development activities for our RSV F vaccine candidate along with higher employee related costs relative to the same period last year. Revenue for the quarter was $3.2 million compared to $6.5 million for the same period in 2015. This 50% decrease in revenue in the 2016 period over the 2015 period was driven primarily by a higher level of BARDA related activities in the third quarter of 2015. The decline in BARDA revenue in Q3 of 2016 is partially offset by $2.6 million in revenue recorded under the Bill & Melinda Gates Foundation grant of $89 million. The Bill & Melinda Gates Foundation revenue is directly related to the Prepare trial, our Phase 3 trial of the RSV F vaccine to protect infants via maternal immunization. As we have previously discussed, we expect an increase in Bill & Melinda Gates Foundation revenue in 2016 correlating to the costs incurred in the Prepare trial. R&D expenses increased 73% to $53 million in the quarter compared to $30.7 million in the same period in 2015. The increase in R&D expenses was primarily due to the increase in activities in our ongoing RSV F vaccine clinical trials and related development activities along with higher employee related expenses which includes an increase in non-cash stock compensation expense. G&A expenses increased 50% to $13.6 million in the quarter compared to $9.1 million in the same period in 2015. This increase is primarily due to an increase in employee related expenses which also includes increases in non-cash stock compensation expense as well as an increase in pre-commercialization expenses. As of September 30, 2016 the company had $300.3 million in cash, cash equivalents and investments on the balance sheet. I will provide some detail regarding future expectations for both expenses and cash burn in my section of the investor and analyst portion of this call. This concludes my financial review of the third quarter 2016. I'll now turn the call over to Stan to begin the investor and analyst presentation.

Thanks all for taking the time to dial into our presentation today. As a reminder this is being webcast we do have a slide presentation. So please join us on our website to access those slides. I expect from this crowd that's on the phone to get a lot of credit for the following. I'm not going to make any reference to the presidential campaign and election results today. So, with that, we have a lot of material to cover, so let me get started. On Slide 3, I'll briefly review our agenda for this call starting out I'll provide an overview of the pipeline and path forward and then I'll introduce you to Dr. James Cummings. You have not met James Cummings before and he has got quite a background so I'll spend a minute doing it. He is our Senior Director of Clinical Development who will provide an update on our Zika program. Prior to joining Novavax he enjoyed a 26-year career in the U.S. Army with a proven track record in vaccine, drug and diagnostics development. He was most recently the Director of the Department of Defense Global Emerging Infectious Disease Surveillance and Response Teams where he led bio surveillance for the DOD with laboratories and partners in 71 countries and served as Consultant to the Surgeon General for all medical research and development. He received his M.D. in internal medicine at Georgetown University and completed an infectious disease Fellowship at Walter Reed and the National Capital Consortium. So our Zika program is in very experienced hands. Next Dr. Louis Fries whom you know will review our older adults Phase 3 trial results and provide information on our next steps in that program. As you would imagine, we spent the last eight weeks pouring over the data from our older adults Phase 3 trial in an effort to understand effects of our vaccine in this trial. I will tell you now that this is still a work in progress where we've identified a path forward for the program. Lou will go through what we know, what we don't fully understand yet and what we are doing to better understand the impact of our product on the older adult population. He will also walk you through some of the details of our path forward. Dr. Greg Glenn will then provide an update on our Phase 3 program for infants via maternal immunization and finally Buck will review our finance and operations and then I'll open it up to Q&A. Moving to Slide 4, overall for the company we have a plan going forward that will build on programs that we believe have high market value, are highly differentiated and have a high likelihood of success. We continue to believe that there is a multibillion-dollar opportunity for the RSV F vaccine franchise and as shown on Slide 5 we will expect to enjoy the advantage of being the first RSV vaccine to market. We have a strong balance sheet and support from the Gates Foundation from an $89 million grant for our lead program, the Phase 3 trial for infants via maternal immunization. If you can step out from under the cloud of the older adult Phase 3 study results, I think I can convince you that we have a profile going forward that is an attractive investment thesis. So where do we go from here? Moving to Slide 6, I'll review our pipeline and our work in the following four programs; first, we have a Phase maternal RSV program underway which will be our lead program for several reasons. It addresses a serious, global, unmet medical need for which there is no vaccine or drug, we believe that it has a high likelihood to protect newborns and their mothers from RSV infection as has been shown in animal and clinical trials respectively, it has a very attractive market and we have the capital to allow us to fund this program to important milestones. This program will be our primary focus. Second, with respect to older adults we still believe that this is a very attractive opportunity. Well, we're going to take a look at alternative vaccine formulations in the trial that we expect to start in the first quarter of 2017 that will give us a lot of useful information regarding both the quantity and the quality of antibody responses that we can achieve. We're going to look at a randomized, observer blinded, multi-arm, dose ranging Phase 2 clinical trial in one dose and prime boost regimens both with and without adjuvants and she what the results tell us. When we have that information, we will evaluate the appropriate pathway forward. That pathway will be largely determined by what we learn over the next six months or so in parallel with that trial. The learnings will be from both the data we get from the dose and formulation study and from the continuing analysis of all the data from our Phase 2 and Phase 3 trials. These data should be fully mined by the time our new Phase 2 study data are out in the third quarter of 2017. Greg will walk you through the recent analyses that we may use to evaluate our new Phase 2 study. It could be that we determine that we want to move back into a pivotal Phase 3 trial or it could be a more targeted initial approach for example in a high-risk population such as COPD. In addition to these two programs we have two other vaccine programs that are being developed at earlier stages and that fit very well with our platform. We believe that our recombinant nanoparticle vaccine technology offers a solution for both the Zika vaccine and a seasonal nanoparticle flu vaccine that will differentiate us in this large market. In particular, we have exciting preclinical data from our new Zika program. These preclinical data suggests that we stimulate perhaps uniquely broadly neutralizing the antibodies and have led us to initiate a nonhuman primate challenge study with our colleagues at Harvard. Data from this trial will be available in January with the expectation that we initiate a Phase 1 clinical trial in the first half of 2017. We don't have details about the clinical path forward beyond Phase 1, but we'll work that out within our own clinical regulatory group in consultation with public health officials. Our current view is that we could initiate a Phase 2 trial in the second half of 2017, but that will in part be determined by the epidemiology of the disease at the time and secondly, the availability of external financing for this program. The commercial opportunity is speculative but potentially very large. One can imagine offering the vaccine to all men and women of childbearing age much like HPV and also to travelers. An additional economic benefit is the potential to receive a priority review voucher under the FDA's program. In recent years these vouchers have turned out to be worth hundreds of millions of dollars. Matrix-M has consistently demonstrated dramatically improved immune responses both preclinically and in human trials with both pandemic influenza and Ebola. We are also using Matrix-M in our Zika nonhuman primate challenge study in our planned Phase 1 Zika trial early next year. Regarding flu, as you know, we have been working on recombinant nanoparticle version of our flu vaccine. This construct should have a number of advantages over our previous VLP format including we believe the ability to stimulate broadly neutralizing antibodies. We are targeting the product profile that would be adjuvated with our own Matrix-M adjuvant and would compete with Sanofi's high dose vaccine in the elderly market. We believe we have a strong mix of programs. Our process has been to identify the best combination of programs that have the following attributes; a high commercial value as shown on Slide 7 and I will remind you that the market for RSV vaccines can be very large with the economic burden of disease in the U.S. alone exceeding $30 billion. All of our programs fit nicely within our technology platform. They enjoy a reasonable risk profile and they will give us either a differentiated product or a first to market advantage or both. Moving to Slide 8, before I turn the call over to the team, let me reflect on the restructuring that took place this morning. Our history over the last several years has been one of growth as we aggressively kept up with the demands of taking not one, but multiple products through Phase 1 and Phase 2 and 3. With the surprise that we got from our older adult Phase 3 program, we recognized the need to regroup and develop a path forward. The first step was to develop a plan for each of the programs going forward. We've done that. We then had to determine how to appropriately size the company to accomplish that plan and in parallel to extend our cash runway. We've done that as well. We announced today that we are reducing the size of our workforce by a substantial amount and Buck will provide more details in his financial and operational update. This is a great group of people that it allows to take two programs into Phase 3 at the same time, it's a very unusual accomplishment. However, we feel that the remaining group is capable of advancing our lead program which is well into a global Phase 3 maternal immunization trial and the slate of preclinical and clinical programs that I've just articulated. We will miss our colleagues who have helped us to get this far and thank them for all their enormous contributions. With hard work and a bit of good fortune we hope to welcome them back in the future. I will now turn the call over to James.

Thanks Stan. Good afternoon. I'm Dr. James Cummings, the Senior Director of Clinical Development here at Novavax. Tonight I will review the Novavax Zika vaccine program with a background on Zika virus infection and disease, the Novavax Zika vaccine construct and address study strategy and rationale for formulation with a look at key external data followed by concluding remarks. Zika virus is a [indiscernible] virus transmitted by Aedes mosquitoes. It is also sexually spread. 80% of those infected by the Zika virus remain free of symptoms. Some common clinical symptoms of those remaining symptomatic 20% are fever, rash joint pain and conjunctivitis. The less frequent, but more severe outcomes include microcephaly and other fetal abnormalities when pregnant women are infected by Zika virus and Guillain-Barre syndrome. That ranges from generalized muscle weakness to complete paralysis requiring mechanical ventilation. Of note, Zika was added to the priority review voucher program list in April of this year. This map represents the geographic areas of active Zika virus transmission as reported in November from the U.S. Centers for Disease Control. This is a breakdown of the Zika case counts in the United States and its territories. In the U.S. we have over 4000 total cases of Zika infection with 139 of those acquired locally by mosquito transmission and an additional 32 cases transmitted sexually in the U.S. States. There are currently 1005 cases of Zika reported in pregnant women with 25 live born infants with birth defects including microcephaly and 5 pregnancy losses with birth defects as well. In the U.S. territories there are over 30,000 locally acquired Zika cases with 100 travel associated cases reported. Guillain-Barre syndrome had been reported in 45 of these Zika cases. There are over 2200 cases of pregnant women with known Zika virus infection in the U.S. territories. Even though transmission of Zika is expected to be reduced in winter months and the dry season, Zika is expected to be reduced in winter months and the dry season. Zika is expected to be an issue for the USA and others for years to come. This graphic information comes from the PLoS Neglected Tropical Diseases article of 25, August 2016. The World Health Organization estimates there is a $10 million lifetime care cost for infants born with microcephaly. If one looks at the projected birthrates and rates of Zika infection in Puerto Rico that's projected to be 7500 cases of Zika related microcephaly in Puerto Rico during the 2017-2018 season alone with the total outcome of $75 billion for their total lifetime care costs. And now on to our Zika vaccine formulation and partner development program. This cartoon shows the Zika virus restructure. I would call your attention to the envelope protein which has special relevance regarding our vaccine construct that we make as a homodimer. Zika viruses have been difficult targets for vaccine production for many years. There have been decades of research on Dengue alone with only a few vaccine constructs to show for this intense effort. Novavax's Sf9 Baculovirus platform technology is a responsive agile system for developing vaccines based on the genomic sequence of emerging infectious diseases. These constructs are then down selected in a number of ways. Finding assays using the SPR Biacore System are employed using human bioreceptors and monoclonal antibodies to confirm that the vaccine target is presented properly. Human convalescent serum from patient with prior infection is also used demonstrating that our vaccine is recognized or bound by those same antibodies that recognize the disease in humans and prevent infection. Animal models are then employed to demonstrate the production of neutralizing antibodies from our vaccine and when available a challenge model is used to demonstrate protection from disease. This cartoon is our Zika virus nanoparticle vaccine which involves the envelope dimers at about 7 nm in size. Zika virus envelope dimer vaccine with Matrix-M adjuvant is highly immunogenic and induces protective levels of neutralizing antibodies in preclinical models. Supporting the selection of our Zika virus envelope dimer vaccine was the SPR Biacore analysis which demonstrated that our Zika virus envelope dimer binds to the human Zika virus receptors AXL and DC-SIGN. On the right side of this graphic the competitor of the Zika E80 [ph] construct shows a negative result another reason that the E80 [ph] construct was not selected. In just the last few months there's been new information demonstrating a quaternary epitope conserved among flavor [ph] viruses on the virus envelope protein. The antibodies to this quaternary epitope provide potent cross neutralization and is further evidence that we have selected an excellent vaccine target that should be present despite the potential change of this virus with time. This quaternary epitope has been reported in nature, science and from the American Society of Microbiology. Leveraging this new information, this cartoon demonstrates our virus envelope dimer vaccine target in blue as one of the envelope dimer epitope that has shown cross neutralization seen in green in both Zika and Dengue virus. This is a demonstration of the quaternary Zika virus epitope. Thanks to Dr. Ralph Burke at UNC for the monoclonal antibodies against this cautionary epitope, we're able to use them in our SPR Biacore System. Using the SPR binding affinity assay with envelope dimer epitope monoclonal antibodies or EDE1 in the graphic, we demonstrate that these broadly neutralizing monoclonal antibodies bind to our Zika vaccine antigen envelope dimer with very high affinity. Our demonstration of a negative result is seen in the lower portion of this slide. The EDE1 monoclonal antibody does not bind to the E80 or refolded construct. In this slide we demonstrate that our vaccine has produced Zika virus neutralizing antibodies in our preclinical animal model, well above the reported levels required for protection. So in terms of our preclinical development pathway, we've selected our lead Zika vaccine candidate, the Zika virus envelope dimer homodimers that form 7 nm nanoparticles. We are underway with the nonhuman primate study at Harvard under the direction of Dr. Dan Barouch, the Director of Harvard's Center for Virology and Vaccine Research and should have Zika challenge results in late January 2017. A Phase 1 safety and dose ranging study to be conducted in the United States is expected in the first half of 2017. In recent New England Journal articles [Technical Difficulty] our proprietary nanotechnology uniquely enables rapid development of immunogenic vaccines. We've identified a very promising vaccine target in the envelope dimer validated by our preclinical data and external findings that I've just reviewed for you. We have a promising track record of obtaining fast-track designation from the FDA and we have the infrastructure in place to seek partnerships to further support the development of this vaccine program. With that, I thank you and I turn you over to Dr. Lou Fries, our CMO.

Thank you, James. I would like to shift the focus now to our RSV F Vaccine candidate and in particular our activities over the last year with regard to the older adult target population. And so if you could advance the slide 31, I'd like to just take a moment to step back and remind you were now speaking of our baculovirus SF9 insects cell derived recombinant RSV F nanoparticle. That vaccine has previously been shown to induce broadly neutralizing antibodies specific for sites 1, 2, and 4 on the RSV F protein in both animals and much more importantly in humans. It has been shown to induce protection against challenge in several animal models including cotton rats which have been predictive in previous clinical programs addressing RSV as well as baboons. The vaccine has shown efficacy in a Phase 2 trial in older adults that we'll discuss momentarily. It has shown the capacity to reduce serologic evidence of RSV infection in women of childbearing age by approximately 50% in two trials, the results of which confirmed each other and is currently in active investigation in Phase 3 in pregnant women where we've already shown efficient transposable transfer in our Phase 2 studies. I'd like to remind you briefly of the details of our proceeding Phase 2 trial in the older adult population. We did a Phase 2 trial E201 in 1600 older adults 60 years of age and older in the 2014-15 season that was a randomized, observer blind, placebo controlled trial which used 135 mcg unadjuvanted dose of the RSV F vaccine. Those subjects were followed for a year for safety, immunogenicity and efficacy endpoints. In brief, the study showed a very well-tolerated vaccine with a benign safety profile. It induced roughly 5-fold increases in palivizumab competitive antibodies and anti-F antibodies in this older adult population. There was a 1.8% placebo attack rate of RSV moderate to severe lower respiratory tract disease that I'll call msLRTD subsequently in the 4.9% placebo group attack rate for all acute to Siebel group attack rate for all acute respiratory disease due to RSV ARD. We showed a vaccine efficacy of 41% against RSV ARD which was a prespecified endpoint in that trial and a 64% efficacy against RSV msLRTD which was a post hoc analysis. Based on that data we embarked on the Phase 3 trial. On the next slide, Slide 32 I'll just remind you of the Kaplan-Meier curves from that preceding Phase 2 trial which showed a quite convincing separation with the first case begin recorded in October 31, 2014 and persistent and widening protection against RSV ARD that was observable all the way through our last case on April 15, 2015 and gave a significant result in this analysis with a p value of 0.039. So armed with that information, we proceeded to Phase 3 and let's go right now to Slide 34. The E301 design included the same target population, older adults at least 60 years old and again it was a randomized, observer blind placebo-controlled trial that was expanded to 60 U.S. sites from 10 sites in the E201 trial. The design was simple. It was 1:1 randomization. Subjects received either the active vaccine at the same 135 mcg on adjuvanted dose or the formulation buffer as a placebo. Those subjects who had not had the 2015-16 influenza vaccine or I IV and that made up about 45% of the population, were offered co-administration on day zero and about three quarters of them accepted that. Randomization was stratified on whether the subject had previously had influenza vaccine, whether they had congestive heart failure and/or chronic obstructive pulmonary disease or COPD their place of residence whether they lived in the community independently or whether they lived in some form of congregate facility and their age, whether they were less than or greater than 75 years of age. They had a standard safety follow-up through a year, serology samples taken at multiple time points and most importantly had active and passive surveillance for acute respiratory disease through May 1, 2016. They were followed to detect RSV ARD or all acute respiratory disease due to RSV, that was any one symptom with RSV detected by reverse transcriptase polymerase chain reaction or RSV msLRTD which required at least three of five lower respiratory tract symptoms and again RSV detection by RT-PCR. Enrollment spanned the 9th of November to the 12th of December 2015 and the last day 182 visit occurred on June 13, 2016. Moving to slide 35 we see the demographics of the study population. We see that the two treatment groups were very well balanced. The mean age in both groups was just a hair under 70 years. About three quarters of the population were 60 to 75 years old and 23.5% was over 75. Our target for the over 75 group was actually 25%. So we hit that very close. 42% were males, 57-58% females and the population was roughly 88% white, roughly 10% black. About 7.5% had either congestive heart failure or COPD or both, 98 or rather 99.9% of the population were independently living in the community. Only 0.1% to 0.2% were either in assisted living or long-term care. As we said, about 55% of subjects had had flu vaccine before they entered the trial, 45% had not had flu vaccine and of that 45% three quarters or about 36% got flu vaccine on day zero along with the RSV F vaccine. On the next slide, Slide 36 we review the top line safety data. I'm not going to discuss safety in any detail because the vaccine was profoundly benign. You can see in this case that there was less than 2% difference in the incidence of all adverse events across the population. The only difference that rose above 2% was in local solicited adverse events, so a little bit of soreness or pain at the injection site, perhaps a little swelling at the injection site that was typically mild and occurred about 3% more often the vaccine than placebos. All the other categories are essentially comparable between the placebo and the vaccine group, so this is a very benign safety profile. On the next slide, Slide 37, we come to the primary endpoint which was RSV msLRTD and look at the evaluation of efficacy. In the upper panel the per protocol efficacy is described and you can see that there were 26 cases in the placebo group and 28 in the vaccine group giving an actual efficacy estimate of negative 7.9% that was essentially no different than the zero and you see the p value is very large and the confidence limits around the efficacy estimate span minus 84 to plus 37% so not distinguishable from zero. We look at the efficacy and some of the randomization strata below and see none of these are significant, none of them are differentiable from zero. The very large negative percentage in the group with COPD or CHF is conditioned by the fact that you have a very small number of cases there. So that huge negative efficacy is really not very meaningful. I would direct your attention to the two rows that outline subjects who received influenza vaccine or I IV on day zero versus those who could not and I would point out that you can see a negative impact, although neither of these results are significant. There's an obvious negative impact on efficacy against RSV msLRTD in subjects who did receive influenza vaccine on day zero. Looking down to the next panel down you see the intention to treat analysis and you'll note that the numbers there are virtually identical with the per protocol analysis. There's only a 47 subject difference between the intention to treat and the per protocol population and the numbers are essentially identical in contrast with the E201 data where we saw 64% efficacy with this endpoint. I would ask you to know two things though, first of all look at the breadth of the confidence interval around the Phase 2 estimate. It spans 1 to 87% and that broadly overlaps the efficacy estimate confidence interval for the current study 301. The other thing I'd point out is that the rate of this endpoint in the placebo group in E201 was 1.75% where as in both the ITT and per protocol populations in 301 it was very much smaller fourfold smaller at 0.44%. Let's move to Slide 38 now and this examines the secondary endpoint all RSV acute respiratory disease. Again, looking at the per protocol data, here you can see the picture is a little brighter. We actually have 12.5%, 12.6% point estimate of efficacy. However, that is not significantly different from zero and you can see that the confidence balance broadly overlaps 0 from minus 14 to 33%. A similar pattern when you look at some of the substrata of the population, again a negative impact of concurrent receipt of influenza vaccine on day zero. Again, no difference in the analysis between the per protocol efficacy population and the intent to treat efficacy population and again the same difference or the same relationship to the E201 results, lower efficacy but broadly overlapping confidence intervals around the estimate for efficacy and notably a 2.5 almost threefold reduction in the rate of endpoints in the placebo group 4.9% in E201 versus 1.98% in the 301 trial. Next Slide 39 looks at a number of healthcare utilization end points that we prospectively studied in this trial. These look at point we prospectively studied in this trial. These look at medically attended events that were related to RSV acute respiratory disease. And you note that there is an impact on these events not surprisingly because they are correlated with RSV acute respiratory disease, but with the exception of emergency room visits you see a reduction in the frequency of physician called, physician office visits, urgent care visits, any outpatient intervention or hospitalization for RSV acute respiratory disease. The next slide, Slide 40 you see some further explorations in this direction. One of the problems that we've noted in carrying out these studies is that often when elderly subjects present to the hospital with acute disease it may be RSV disease, they present to another hospital, not one that is affiliated with a particular clinical site and at that point they pass out of the jurisdiction, the IRB that's approved the trial and into the jurisdiction of another IRB. So we can't send site personnel into that hospital and get a swap. So we can't confirm RSV associated hospitalization in many cases and therefore there's only two, here observed in this very large trial, but both are in the placebo group. So we stepped back and we examined all-cause hospitalizations either for any cardiorespiratory diagnosis or more specifically any respiratory diagnosis and then looked at any hospitalization and from the least specific of these any hospitalization where there's a 3.6% impact of vaccination if you step to a more specific category any cardiorespiratory hospitalization you see a 10.8% impact and with any respiratory hospitalization a 22.5% impact. So very similar to the magnitude of impact we've seen on RSV acute respiratory disease. Very interesting and something that we discovered post hoc actually when we were examining in detail the impact of this vaccine on safety events is the incidence rate of all-cause serious adverse events due to COPD exacerbations. These are patients with pre-existing chronic obstructive pulmonary disease who get transiently hospitalized because the disease gets worse and they may have hypoxemia, they may have lots of sputum production, increased wheezing, increased difficulty breathing which required them to be hospitalized briefly. And those subjects and those events were actually fairly markedly reduced in the vaccine group. Now I think we have to view that with some caution because of the post hoc observation, but it is certainly tantalizing especially because RSV is known to be associated with deteriorations in chronic obstructive pulmonary disease. The next slide, Slide 41 is the first slide that looks at immunogenicity. This is preliminary data for anti-F and for palivizumab competitive antibodies drawn from a representative subset of subjects as you can imagine is the 12,000 subject trial with all those serologic endpoints I pointed out. So the testing here will go on for quite a long while. There are scores of thousands of tests to be done. However, what we can see is that the RSV F vaccine in this case caused about a 6.1 fold increase in the geometric mean ELISA units for anti-F IgG and for palivizumab competitive antibodies about a 4.47 fold increase in the concentration of palivizumab competitive antibodies. And if you'll think back, I described the increases in E201 is approximately fivefold in both those parameters. So the vaccine is behaving about the same with regard to these measurements and in the placebo group you see full rises of essentially one. So this confirms that this is a vaccine specific event. On the next slide, Slide 42 when you look at microneutralization titers these are complete set from the study population. Again you see basically nothing happening for either RSV A or RSV B microneutralization in the placebo group whereas in the RSV F vaccine group we see 1.6 fold rises in geometric mean tighter for RSV A and 1.8 full rise for RSV B. These are again very close to the values that we observed in E201. So the next Slide 43 to summarize, we had a safety profile that was consistent with Phase 2. We had attack rates of both all-acute respiratory disease due to RSV and moderate to severe lower respiratory tract disease that were markedly lower than expected. In terms of efficacy, we did which failed to show the efficacy that we set out to demonstrate we did find a trend suggesting efficacy against acute respiratory disease and that was supported by a number of observations in terms of healthcare utilization and respiratory hospitalization. We did notice that efficacy against both moderate to severe lower respiratory tract disease and acute respiratory disease was improved in the absence of influenza vaccine administration and that is perhaps no not too surprising. Influenza vaccine often plays the bully on the block with other vaccines when they are administered concurrently and so that could be a coherent picture. Our immunogenicity results were broadly consistent with Phase 2. The microneutralization increases were modest, but they were fairly robust PCA and anti-F responses. We have ongoing analyses to look and see if any of these measures provide a correlative risk and just a couple days ago we got our first encouraging results from the - that, that PCA in particular may correlate with a reduction of risk. The curves are shallow and the work is ongoing to understand that, but it's a tempting bit of data. Let's move on now to the E202 results in the next slide and the next slide please? As you will recall E202 was a so-called rollover trial that was designed to examine both the need and the benefit of annual re-immunization. We did that by enrolling older adult subjects who had graduated from E201 and provided kind of an unique opportunity to evaluate our ability to enhance the vaccine response a year after initial dosing to look at the duration of vaccine efficacy and the ability to maintain and recover efficacy one year after the initial dose and the safety of repeated dosing which we always have to keep in mind. We enrolled 1329 of the original Phase 2 participants and we randomized them into four different cohorts. Otherwise the trial design was similar to the Phase 2 and 3 trials. So as you recall, in E201 we had a vaccine and a placebo group of equal size and we split them again randomly 1:1 to receive vaccine or placebo. So in E202 we had a group that had received vaccine twice. We had a group that received vaccine in the first year, but not the second and so we can look at residual protection. We had a group that had received placebo in the first year and vaccine in the second and so this would essentially be a confirmatory check on 301 and then we had a placebo and placebo group to serve as a control. Moving to the next slide, Slide 46 we found in terms of safety that there was a minor increase in mild injection site pain in people who had received a second active dose. So were being boosted in the second year, but otherwise there were no obvious differences in safety. Our surveillance data in E202 demonstrated that the rates of all acute respiratory disease which were 2.4% and msLRTD which was 0.3% or low in 2015-16, so those basically confirmed the performance in E301. And then in terms of efficacy, we saw really no evidence of residual protection of an initial dose when you look to the second year that didn’t terrible surprised us. In older adults antibody responses do decline fairly rapidly. We saw no efficacy of a single dose in the second year, so that was a confirmation of the E301 results. But tantalizingly we saw the group that received vaccine in both years had 75% and 100% efficacy against ARD and msLRTD respectively. They weren’t statistically significant. The numbers are small. But they do stick out and catch your eye. There is there is clearly different efficacy in the individuals who had received two doses. The immunogenicity analyses of that study are ongoing. They are going to be complicated. The performance of the first dose appears to confirm E301. The second dose actually quantitatively looks less but we may have tools to understand that a bit better and Dr. Glenn will speak to those subsequently. So let's move on now to Slide 48, obviously we were disappointed with the E301 results and we wanted to understand what appeared to be a fairly striking divergence with E201. We looked at the trial design differences and there were some based on our increasing experience in time with doing efficacy trials in this population, but nothing that we could think of that would explain the divergences. So we came up with a couple of hypotheses. We wanted to know if the conduct in E301 was flawed. Did we mess up in some way? Obviously we have made it a much larger trial went from 1600 to 12,000 subjects and was there flawed conduct on that basis? We wanted to know if there were differences between the test articles. There had been some maturation of the process and we wanted to know what the test articles in E301 and E201. And the last thing we wanted to think about was the impact of the unusually low attack rate that we saw in E301. So, on Slide 49 we first looked at the performance of the individual sites and where subjects reporting were illnesses that were reported being swabbed and were they being swabbed in a timely manner and point of fact they were. We found that 83% of all reported illnesses received swabs and more than 98% of those were within the five-day time limit carrying out the swabbing. I should note that this is and when doing large studies like this in older adult population this kind of performance is really good. This is industry standard. I reflect back on for example, the older adult trials Sanofi carried out for their high dose flu vaccine. They were able to recover swabs, diagnostic swabs on 79% of their older adult population. Similar, somewhat lower numbers in GSKs older adult trials. So point of fact this is very - this is quite satisfactory performance in terms of diagnostic testing of the subjects. We also looked at both the ascertainment of illnesses overall and the ability to recover swabs in both the 50 newly trained sites and contrasted them with the 10 experienced sites from E201 and found very minor differences, certainly nothing to explain the difference in attack rate that we saw in this study. So then we turned our focus to the RT-PCR lab and we had actually anticipated that we want to know this data. So we carried out on several occasions blind - first of line we had carried out an extensive validation protocol of the lab before starting this study. That was a protocol that was provided to the FDA and we adopted every comment they had on it, so we carried out an extensive validation. And then several times during the course of the trial we administered externally prepared blinded proficiency panels including RSV and other viruses at the beginning and the end of the study and the lab performed 100% in terms of the sensitivity and specificity on those panels even when the RSV was spiked in at the very limit of detection of the asset. So we are very satisfied with the performance of the lab and that was validated because the lab detected whole bunches of other viruses, coronaviruses, rhinoviruses and captured influenza rates and at times that exactly reflected national surveillance. So the lab was performing well. We looked at the integrity of randomization. We validated that against this pharmacy dispensing records at the sites and also by looking at the post vaccination antibody responses we found a very, very low rate of randomization error of 0.4% that could not have explained the result. So the study appears to have been performed well. We also looked at manufacturing changes and we reviewed an extensive data package that was generated and submitted to FDA that established comparability between the two processes. We looked at comparative animal immunogenicity of limiting doses and we looked at post vaccination immune responses and all of these were consistent with the Phase 2 trial. So there was no obvious evidence of trial misconduct or product issues to explain the divergence, certainly nothing that's occurred to date. We continue to examine the product to make sure there are no issues. On the next slide, Slide 50 we also looked at the potential influence of low attack rate and the influence of low attack rate really there's no history to understand the influence of low attack rate in RSV F trials in adults or RSV vaccine trials in adults, but there simply are no large RSV vaccine trials in adults other this one. But the influenza literature does give us some guidance there and in the influenza literature the modulation of detectable efficacy by attack rate is very well recognized in the history of influenza clinical trials. And there are multiple instances of studies using the same vaccine products, the same investigation, the same trial methods and the same study populations that can show 40% to 50% decrements in observed efficacy in sequential years when the attack rates are low. Interest in that effect, the influenza strain changes, but that effect is independent of influenza strain match and you can see the effect of low attack rates depressing observed efficacy even when the strain match in the low attack rate year is better than in the high attack rate year. This effect has been recognized and analyzed in the epidemiologic literature and there's a quote that I won't read from a paper by [indiscernible] and Halloran, but basically that recognizes the fact that efficacy estimates simply may not be comparable unless there is an explicit control and similarity in baseline transmission. We know that in 2015-16 it was a relatively low transmission year in adults that's validated not only in our data set by in data sets by other groups who have been doing either systematic surveillance in adults or in the just by anecdote in people who are RSV interested clinicians who have been following transmission in adults. Our trials of RSV vaccines in older adults are really the only other non-influenza large-scale trials in older adults that address an annually recurring respiratory virus for which prior infection modifies but doesn't eliminate the susceptibility of those. So we think there's a good chance that the low attack rate in 2015-16 may have modulated our ability to find efficacy, possibly because the background resistance in the population was high. We're still trying to understand that. It's an area of new understanding for RSV, but there is an influenza precedent. The next slide, Slide 51, so that brings us really to whether we can establish a unified view from 201 and 301 and 202. This is a hypothesis, but it's become our way of looking at these data. In the Phase 2 trial in older adults E201 we saw significant efficacy against ARD but with wide confidence intervals. The trial was not really powered to detect that level of efficacy. The original power design was targeting say 70%. So the wide confidence interval is not terribly surprising. We also saw 64% efficacy against msLRTD that was noted post hoc. The circumstances, the RSV attack rate was relatively strong, almost 5% right in the middle of the historical range published for example in the studies by Ann Falsey in Rochester. Retrospectively we saw an impact of influenza vaccine co-administration there as well. Moving to the Phase 3 we had a valid trial shows efficacy that's not significantly different from zero for both ARD and msLRTD, but again broad confidence bound because of the low attack rate really and in fact there was this confidence bounce on retrospective examination pretty broadly overlapped by 50% to 60% the confidence bounce in E201. The conditioning circumstances again, low attack rate and repetition of the I IV effect. Last, but not least, there is the Phase 2 rollover trial in older adults where there is suggestion of efficacy that kind of sticks out in people who have got two sequential doses. True, they were separated by a year, but we did something different to the immune system in those people, perhaps than we did in E201 or E301. So our synthesis of this data is as follows: we believe the 201 and the 301 results may be driven by the same underlying efficacy that is the really drawn from the same statistical distribution of results. We got lucky in 201, in 301 we were facing a low attack rate year and we got unlucky. If that's true then the weighted average estimate of efficacy might be 19%-20% against ARD. We know the co-administration of I IV and a low RSV attack rate in 301 both conspired to make success difficult to achieve. So we believe the vaccine can have efficacy and we think it's shown us the efficacy, but it needs enhancement of the immune response in older adults and one of the things we can take away from E202 is that it may suggest a way to achieve this. We may have to hit them twice in a regimen that is designed to make that palatable for use in the real world. Alternatively, adjuvants may help us and my colleague Dr. Glenn is going to present some suggestive data later that indicates we may have a path forward. In the meantime, the next, so next slide, so going forward we're going to continue development of RSV F. We know that immunogenicity is more vigorous in younger adult populations including pregnant women and especially children and adults with low baseline titers coming in. We do believe there are several avenues for enhanced efficacy and immunogenicity that we can explore in older adults and we're going to do that. We do have some concern that our current suite of immunologic endpoints may not adequately capture protective responses and we have work underway that again Dr. Glenn is going to speak about to enhance our analytical tools. So returning to older adults though we're looking at dosing and formulation approaches that can overcome the heterogeneity and background immunity for attack rates. So, on the next slide, as you've heard we are going back to Phase 2 in the older adult population with a trial that we call E205. We anticipate starting our trial in the first quarter of 2017 and having topline data in Q3 that will be done in the Southern hemisphere to avoid the confounding of the RSV seasons. We want to ascertain whether adjuvantation or two-dose primary regimen can alter both the quantity and importantly the quality of immune response in older adults. And we also obviously evaluate the safety of those revised regimens to see if they are still suitable for use. The endpoints will be safety, but also RSV specific immune responses by microneuts, by anti-FIgG, by power vision competitive antibodies, but also crucially looking at antibody avidity assessments especially for the site to target peptide and perhaps others and also to look at T cell responses. That will be a trial of 300 healthy older adults, a randomized observer blind design with both 1 and 2-dose regimens with and without aluminum phosphate and with and without our proprietary Matrix-M adjuvant. And at that point I will conclude and hand the presentation over to our President of Research and Development, Dr. Glenn.

Thank you, Lou. So what I'm going to do is cover some familiar ground on our vaccine for protection of infants via maternal immunization and talk about our progress and some new data. So if you go to the next slide, so I'll review the competitive landscape briefly, look at some of the key preclinical data which has undergirded this program to remind you why we have confidence in what we're doing and look at the Phase 2 data, again remind us all of some of the key safety immunogenicity results, look at the Phase 3 study design and then we're going to address some of the support for continuance of the maternal trial and the lessons learned. So the next slide as you can see here is a, I'll just touch on this briefly, this is the competitive landscape for RSV vaccines and you can see I think that the highlight here is that we remain the only product that is in a Phase 3 trial state of the development and of course this is our global trial Prepare for the evaluation of the maternal immunization vaccine. So if you go to the next side, just remind you of some f the data that we generated that we think is important. This is the data in cotton rats. Cotton rates were used as the predictive model for the development of the monoclonal antibody palivizumab and the followup product motavizumab and the use of the monoclonal and the challenge with RSV virus and looking at titers of the virus of the lung those assays and those data were predictive for the subsequent trials in which there were five randomized clinical trials showing these antibodies work. And as a reminder they bind to site 2 on the F protein which we know is contained in our vaccine and what you see here on the left is the immunogenicity and you can see the measures are anti-F, IgG, palivizumab and neutralizing antibodies. And the trial was designed to evaluate a range of doses from 0.003 mcg up to 3 mcg and you can see very nice dose response by all the immune measures. And then on the right, in the setting of challenge of the cotton rats and then looking at the lungs for viral titers they typically would demonstrate about 5, log 10 PF use per gram of tissue in the lungs and you can see with our vaccine we achieved sterilizing immunity which is really quite good and you can see on the right compares well with palivizumab. And the axis below this should reflect the same axis you see on the far left and so you can see the dose response of the vaccine as well as palivizumab. So very strong immunity. We see the immune measures that we've taken in the clinic look like they're meaningfully predicting the RSV protection and in fact it can achieve sterilizing immunity with our vaccine at very low doses. Now if you go to the next slide, just to remind you, we published some data on guinea pigs showing transfer of antibodies. This presented an opportunity to look at the relationship between these measures in particular looking at RCA micronutrients which are generally considered to be a functional assay in palivizumab and there's quite a close relationship with a nice correlation between these two important immune measures. And then finally just pointed out in the next slide we have done modeled the maternal immunization study in baboons. We immunized pregnant baboons and then the baboons after birth are challenged with RSV and we look for increased respiratory distress and you can see what this graph is measuring on the left to control with palivizumab was showing a very nice effect of palivizumab on keeping the infants from going to - for distress. You can see the placebo line as a higher pulled right and you see the dame data reflecting in those infants born to vaccinated mothers again decreasing their respiratory distress by the induction of antibodies in the mother, who will transfer those antibodies to the infant and has protection in the lungs of infants with the vaccine induced antibodies. So if you go to the next slide, I just also want to touch on elements that are relevant to the end of my presentation. We did a number of studies to select a formulation for the women of childbearing age application and they are illustrative which you could see on the left is an analysis of our study where we were comparing alum and no alum and this is the post immunization microneut titers as polarizer on the Y axis and on the X axis we show to the population by their preexisting that is a day zero microneutralization titers. And going from large to 7, 8, 9, 10 and so on, you can see in green those subjects who received the aluminum phosphate adjuvanted vaccine really had quite dramatic effects on the fold rise of microneutralization especially in those subjects who have the lowest titers. And we would contend that that's a key population to induce a strong immune response if those are likely, the infants, they will be born and these mothers will be likely at the highest risk for RSV disease. And then on the right and I won't go into much detail we did a number of studies like the adjuvant itself, abdomen dose itself and showing that we can induce with a single dose regimen an immune response that was comparable to the two dose regimen which was made that much more suitable regimen for immunizing women during their third trimester of pregnancy. So if you go to the next slide, go to review now the Phase 2 data, so on September 2014 we did a Phase 2 clinical trial on healthy pregnant women 18 to 40 years of age. The trial was a randomized observer, placebo-controlled trial, and there is in 50 women, pregnant women 85 in U.S. and it was during the 2014 RSV season they received the full active dose based on their earlier studies where we used a 120 mcg of our RCF vaccine and 24 mg of the dose of aluminum phosphate and all these subjects were immunized between 33 and 35 weeks gestational age. So if you go to the next slide, just as very quickly for safety was the primary concern here to demonstrate the vaccine was safe as we'd seen in the previous studies in women of childbearing age, healthy adults and our preclinical package. And again I'd say that the prominent feature was some local transient injection site pain. This would be sort of expected with this vaccine is mostly predominantly mild-to-moderate and transient and we think acceptable. There are no SAEs [ph]. The infant safety and labor delivery events were also we felt were certainly acceptable for moving forward into further trials. So if you go to the next slide, just again this summarizes the immunogenicity we observed in this study and the way we can look at this is the left, far left column has different immune measures we described earlier anti-F IgG antibodies, palivizumab competing antibodies where we take palivizumab and we measure the competition for binding to the site two on the RCF protein versus the palivizumab. It is a measure palivizumab like antibodies and then microneutralization assays measuring both microneutralizing titers against the RSV A virus or the RSV B virus. Now in the second column you can see what we have there is cord blood which would represent the antibody titers in the infants and those are the mothers and the ratio of the transfer ratio which represents essentially the antibodies of the infants over the mother as a ratio. In the expected ratio frankly from the literature for maternally transferred antibodies would be somewhere north of 1 up to 20% to 30% greater antibody titers being detected in the infant and the mothers. And what you can see if you look at the all called first we detected overall in this population an antibody transfer rate first of all quite robust antibody transfer, but the rate a little harboring around 1.0. But if you look at the palivizumab antibodies for example, these are quite robust titers reaching in the 200 range and microneutralizing titers again are quite robust. And what we learned from this is if we sorted these patients by the interval between which they are immunized and the infant in which the infants were born using 30 days as a cutoff, we could see a fairly dramatic difference between those immunized greater than 30 days before the birth of the child and those less than 30 days. And you can see in the middle column what we are expecting in the result to look like with ratios of 1.2, 1.1 so we saw relative antibody concentration in the placental transfer to all these immune measures and that was an important lesson and again met our expectations. So the lesson learnt from a clinical trial standpoint was to ensure in our analysis population that we looked at infants who were born 30 days after the immunization. So they had sufficient time to develop an equilibrium and a concentration of those antibodies. But what we see here very robust antibodies, good transfer and functional transfers median expectations of about 20% increase in the overall antibody titer in the infants. And then finally, we did look at the half-life and you can see PCA was around 40 days and the microneutralization were around 35 days and that would bode well for antibodies being present out to four to five months and suggests that it could expect protection at least out to that time period. So if you go to the next slide, the other analysis we did as we've discussed earlier, we know there are several broad neutralizing antibody sites that are historically defined and two of them at least included into clinical evaluations and we would highlight situ or the palivizumab competing site where we measure the antibody. So this is a compatible ISA. You are looking at antibodies that are in the mother and into the cord, therefore the infant and again, you can see we compared with the placebo which represents we see it there zero. So if you look in the far left the monoclonal antibody 112 site one can see the placebo level, there's many subjects who have no detectable antibody, some that have been derived from infection have some site one antibody, but after immunization we have a uniform increase in the population and a reflection of those antibodies being passed from mother to the infant. And you can see there are two site one antibodies we evaluated, a site two antibody and a site four antibody. All these antibodies may be expected to contribute to the overall protection of the infants independently although we're focused on site two as there is a robust set of clinical data demonstrating that these antibodies should be protected. So if you go to the next slide just in summary of our Phase 2 trial the vaccine was well-tolerated. We saw a response to the vaccine in pregnant women that reflected very much the experience we saw in non-pregnant women. We saw the antibody peak quite quickly post vaccination. There was anti-F PCA and neutralizing antibody that did transfer. We did decide strategically that there was a balance of this vigorous early antibody response and the level of trans visceral transfer in the women and greater than 30 days interval between immunization and delivery would provide a more ideal transfer. We have an observed half-life of 41 days for PCA through the first six days post delivery and again this suggests at least 90 days in which we should have levels that we think would exceed those needed for protection and maybe after four to five months when we should have detectable antibodies and we could expect effects after 90 days. So if you go to the next slide, so now I'm going to talk to you about the Phase 3 study design very quickly. The study design had a primary objective to determine the efficacy of maternal immunization with the RSV F vaccine against symptomatic RSV lower respiratory tract infection with hypoxemia in infants through a minimum of first 90 days of life. And just to remind you, this is a randomized, observer blind, placebo controlled trial, it is a group sequential trial and as you know, that allows us to collect data over several seasons and make our analysis based on events. The trial could be up to 8000 over four years. We have started the trial. We've finished year one in the U.S., South Africa, Australia, New Zealand and Chile and then we are adding to those countries sites in Argentina, Spain, Italy and the Philippines in this current year. We will follow the maternal participants for nine months and the infants for one year and this is a single injection given between 28 and 36 weeks of estimated gestational age. So looking at the next slide, we also looked at some key secondary objectives of this trial and this would include determining the efficacy of maternal immunization in reducing the incidence of RSV lower respiratory tract infection with severe hypoxemia as measured by pulse oximetry less than 92% and/or the need for high flow nasal cannula or mechanical ventilation. We also look for RSV ORTA [ph] leaving the hospitalization if it results in death and then all RSV lower respiratory tract infection. So if we go to the next slide, we do have a very important feature in this trial, this trial is being observed by Data Safety Monitoring Board. There is unblinded, their primary mandate is to look at evolving safety aggregate safety data. They review it in a completely unblinded fashion and on a monthly basis during enrollment. It is composed of both pediatric and obstetrical experts. It is supported by an independent unblinded statistician who has full access to the clinical data base and the treatment assignment. And to date this group as met many times and to date the formal recommendations made by the DSMB after review of the unblinded data at each meeting has been to continue the trial execution without alteration and there have been no apparent safety concerns and no advises to modify half the trial. So go to the next slide, so now let me just diverge briefly into the basis for our confidence in this program and just to touch on a few items that there are supportive data for the RC vaccine for this program. So as I mentioned at the beginning of this talk we have protection that was demonstrated in relevant animal models, cotton rats and baboons and this is quite unique for a novel vaccine to have data like that that has been connected to clinical trials. We do induce broadly neutralizing antibodies to these various sites. Site two specific antibodies are of particular interest because they relate to palivizumab and motavizumab which have demonstrated FC in a passive transfer setting which is precisely the kind of a way we're providing antibodies to the infants through maternal immunization. So the infants receive high titer palivizumab competing and microneutralizing antibodies via passive transfer after maternal immunization. So, and I'm going to show this data in a minute. We have demonstrated high antibody responses women of childbearing age who received aluminum adjuvanted vaccine which we think is very important and I will elaborate that as I mentioned. We've also seen that in the Phase 2 setting with women of childbearing age as they pass through a season we were able to check serologic conversion indicating that they had RSV infection and in the [indiscernible] we saw a 50% reduction in infection which is quite a high bar. And as you may know we published this data. We had a second controller trial and we've discussed this publicly showing the confirming the same result over two seasons. And then so as we think about some of the risks that we have in our Phase 3 trial that we believe the risk program that is in the event driven global multi season trial which allows us to adapt the size to the attack rate. And of course in infants which have been long studied for their RSV infection the epidemiology is quite well-defined and of course we're bringing to this program an aluminum adjuvanted vaccine formulation. Let's go to the next slide and talk a little bit about recent lesions learned and as Dr. Fries mentioned we are quite interested in whether we can refine our new measures. So one of the directions this has taken is to look at offending, so in general high affinity antibodies targeting broadly neutralizing epitopes are considered the most desirable for protection in almost any setting, both from natural infection and from vaccines. And one of the hallmarks of palivizumab and motavizumab is the fact they are characterized by high affinity binding the site two on the up coating and we mentioned that this clinical efficacy has been demonstrated an indication site two antibodies are protected and what I think has come out of those studies motavizumab was developed on the basis of its higher affinity. In fact they had approximately 100 fold greater affinity than palivizumab and when the clinical evaluation was done and they had trials motavizumab performed notably better than palivizumab, again reinforcing the importance of affinity. So we've looked at the, we've began to look at the affinity of our vaccine induced antibodies and affinity just to – it’s a little bit of a simplification of the principal where it measures the strength of binding of the antibodies to our vaccine target to an epitope or to a pathogen and this was proved with surface plasma resonance and compared with PCA. So if you go to the next slide this is a bit of a busy diagram, but it shows an overview of B cell immunity and I think it is important for us to dwell on this for a few minutes before we explain our data. So this is an overview of B cell immunity in healthy adults and it is important as B cells compose the arm responsible for the protection of antibodies. This system is programmed to recognize antigens such as those pathogens found on pathogens in vaccines and to produce high affinity antibodies So what are high affinity antibodies? Why do they matter? As I mentioned affinity is a measure of the strength of the binding of an antibody to its target such as site two protein and it is generally accepted that high affinity antibodies lead to better immune effector events and thus better efficacy. So in this diagram you can see the various points at which B cell stimulation can result in antibody production and how this system is really programmed finally to induce high affinity antibodies. So on the upward left you can see a naive B cell and when they encounter a pathogen or a vaccine they divide and mature into cells known as plasma cells and you can see them in the lower tier and those plasma cells produce antibodies. They also divide and mature into cells that eventually become memory B cells that are flowing from left to right and you can see we arrive at the IgG memory B cell indicates an RSV infection. These can be specific for site two. So they are very epitope specific memory B cells. So in older adults - so this is a healthy immune system and you can see if you gave a vaccine to naive subjects, frankly they'll make IgM, they'll make IgG and the first level of production of plasma cells happens from naive B cells and the affinity of the antibiotic produced in this setting depends on the strength of the initial immune stimulation and adjuvants are very good at taking naive B cells and actually producing fairly high affinity antibodies. But they also push the IgG memory cells and so in older adults, sorry in young adults and older adults it had multiple exposures RSV they have a very robust population typically of RSV positive IgG memory cells and specifically site two IgG memory cell. So vaccine whether or not it is adjuvant that where the memory B cells encounter this produce very rapidly high titer, high level of high affinity IgG antibodies and they further undergo the development which is called somatic hyper mutation which leads to affinity maturation we call them selections, so you get another clone of memory B cells that have even higher antibody affinity. So you can see the B cell system is biased to produce high affinity antibodies, again further evidence that they are important for vaccine efficacy. Now if you go to the next slide, here is what happens in older adults. So the hallmark of immunosenescence is to lose these memory B cells and it essentially creates the inability to produce high affinity antibodies readily as you might see. So older adults or have a mixed population, some older adults really have quite intact immune systems, some adults have this depletion that's going on and you can see by the red crosses through those cells now those cells have been knocked off and there's various mechanisms by which this happens. For example chronic CMV infection is known to deplete memory B cells. So you can imagine you have an RSV positive very specific B cell population that recognizes site two. You have a CMV infection and they're taken out and now that subject is simply like a naïve human and you need to start over from the very beginning to generate high affinity antibody. So if you look on the far left here if you use the vaccine without adjuvant the signal is not very strong and you could result in these plasma cells that have low affinity to the site two. So this is something we've learned and now if you go to the next slide, what I'm going to show you here is we believe we developed some immune assay that will allow us to interpret these effects in the serum of immunized subjects. So using the combination of a competing assay when we measure antibodies that compete with palivizumab as I mentioned that bind to site two on the F protein, and by a second assay surface plasma resident which measures the affinity of binding to a specific site two peptide. We believe we can better understand in a clinically relevant manner the immune responses that we're observing in these trials. So initially we've done this with serum from M201 which is one dose finding studies in the healthy women of childbearing age which you see here and I'll show you a second slide drive from the serum from the Phase 1 trial in older adults. What you see here now is the latest assay works as you take a peptide you pass the antibodies over, they bind to the peptide and then you can measure how long they bind to the peptides. So the longer they stay on the higher the affinity and they way this works is this off rate is an inverse so the lower number is actually a higher affinity. You can see on the left there the arrow indicates low affinity to high affinity and you have placebo, you have day zero and day 56, you have placebo, vaccine 90 mcg without aluminum phosphate and this is actually little bit of phosphate. And at the top level you can see the collection of darts there indicating that most of these subjects are immune naïve, they in fact we know they have very little PCA and we are not - very little or no PCA and when measuring very low affinity and essentially no affinity, no measurable affinity here. So if you slide over to, excuse me, move back to the slide, if you go to the second column, you can see the effect of the antigen and you move a day 56 you move a very significant member of the population step high for the antibodies and for reference you can see palivizumab on the far right 10 is a minus 2 and so these are a little better than in the mind to so these are a little better than palivizumab as a genetic lead. However, I have circled there for you the subjects who are not moving, who are not producing site two antibodies that are high affinity. Now I'll show you what that population looks like in just a minute. By contrast if you give the population the adjuvant at 90 mcg vaccine you can see the full population moves down and there is no nonresponders, so empty circle above there. And frankly these are hundred fold greater than palivizumab reflecting an antibody affinity that is very much like motavizumab. So, very desirable outcome in that the all the subjects zero after vaccination indicating that we've produced high affinity palivizumab creating antibodies. Now if you go to the next slide in contrast, older adults, again you see on the top there the absence of affinity in most measures day zero and the if you moved to the 90 mcg no aluminum adjuvant which we flexed the formulation we have had in our Phase 2 or Phase 3 trial we are moving the antibody affinity in a very modest way and we have many people that are in this circle there that have not responded. When we have the aluminum phosphate adjuvant again we create a population that looks like young adults, but again there are subjects there who have low affinity antibodies. So again, just flip back to the previous slide. You can contrast on the far right, what we have in the total immunization which is very, very encouraging for us and then if you go to the next slide on the far right you can contrast in the middle frankly the minimal affinity we are able to induce in the older adults. So if you go to the next slide, this is the pie chart and this illustrates the populations of antibodies who are detecting in those studies I just showed you. And the legend is that in the grey you have palivizumab completely palivizumab negative subjects and they have no measurable binding. But what surprises is we find this population of subjects that do have some measurable PCA, but their antibody affinity is essentially very, very low. We can't measure it. It’s below the limit of quantification in our assay. And you can see we measure high affinity antibodies and so on the left women of childbearing age our formulation at the very bottom of vaccine with aluminum phosphate is extremely good at inducing in all the population high affinity palivizumab site two competing antibodies. By contrast you can see in the middle on the right with older adults we are moving at population and if you combine the blue and the orange, this would have reflected a palivizumab competing antibody positive population and you know we saw around 80% to 90% of the subjects with palivizumab competing antibodies. We took that to be sufficient for protection and that we saw on the Phase 2 study we did see protections, so we were comfortable with this. But I think on further analysis we can see that blue population and the grey population frankly that has not changed after vaccination, would not be desirable for producing protection and you can see the adjuvant correct stat we have no longer immune naïve subjects. They are all prime to palivizumab. We still have subjects in this trial and this is the Phase 1 trial. This is the flu immunization that have antibodies that we think might be low affinity. And so, as we go forward, as we do the trial Lou discussed we will use adjuvant and/or multiple dose. We will use Matrix-M. We will use aluminum phosphate. We will use one and two doses. We think this evaluation of the antibody quality will allow us to differentiate between our vaccine formulations and choose the best formulation to give us the highest affinity palivizumab competing on the site to antibodies. So, if you go to the next slide, I think the implications here are quite important and just to show you again, these, the women of childbearing age subjects and timing subjects have intact RSV immunity to slide two single dose with adjuvant vaccine is also very high affinity antibodies. The antibodies we see have affinity that are greater than palivizumab and aluminum increases both the affinity and now we know from our previous work the amount of high affinity antibody which is all very much [indiscernible] the success in our Phase 3 Prepare trial which does use this formulation. In older adults well, we've learnt here that some have intact RSV immunity the site two, but others need us to convert their naïve B cells produced by affinity antibodies and these prime low affinity B memory cells produced by affinity antibodies which is our target. So, and if needed we may need to use the second dose which would further convert these host affinity population that we see that are prime, but are still producing low affinity antibodies. So, this is a very powerful assay. It is something that has provided us some insights and this now may also allow us to define the cold weather protection and risk. It helps us as I mentioned this, we believe this will help us interpret our older adult formulation studies and select amongst the adjuvants and decide if the two dose regimen is beneficial. So, we have learnt some important lessons. In summary, I think we have new measures that are going to help us. And I think with that, I will end my talk and turn it over to Buck. Thank you.

Thank you, very much Greg. To this point, Stan, Jim, Lou and Greg have done a great job laying out our corporate objectives and the scientific rationale and development plans that will be the focus of our R&D activities through the end of 2017. I would like to take the next few minutes to translate those activities into our financial and operating plan. Next slide, before we look ahead, it’s important for us to review our 2016 operating plan and the related financials. In 2016, our operating plan was built around activities supporting RSV, influenza and new product development. As we can see here on slide 82, our primary focus was on the RSV F Vaccine executing both our Phase 3 older adults resolve trial and our Phase 3 infants via maternal trial for repair. In addition, we had the Phase 2 older adult's rollover study and a series of other activities that were ongoing to support the next steps in the development and ultimately our view of the commercialization RSV F vaccine in older adults. We continued our work in influenza which consisted of managing the BARDA contract to its maturity in September of 2016 as well as the important work to transition our seasonal influenza vaccine to the nanoparticle platform from the VLP platform. And as is always our conduct here at Novavax we are always looking for new product opportunities. These operating plans are inherently tied to the financial forecast and ultimately the reported financials we put forth in front of you. Financial plans are simply an economic measure of the operating plan. Next slide, so to do that translation, we are looking a slide here, slide number 83, that contains three key pieces of financial information; a simplified income statement, cash used in operations, and ending cash and investments for both Q1, Q2 and Q3 of 2016. Together, this information helps to explain the financials for the first nine months of 2016 and provides the foundation for a discussion of our 2017 financials and operating plan. Next slide, let’s focus on three key components of the financials. Expenses, cash used in operations and ending cash and equivalents. With regard to expenses, in R&D, the key driver to expenses in 2016 was the Phase 3 older adults RSV trial and the Phase 2 older adult RSV trial. As shown in footnote A, R&D expenses were $68.9 million, $64.9 million and $52.9 million in Q1, Q2, and Q3 respectively. Per our guidance throughout the year, we guided that R&D expenses would decline dramatically in the third quarter of 2016 as those RSV older adults trials wound down. With regard to G&A as highlighted in footnote B, expenses were $10.5 million, $14.1 million and $13.6 million respectively in Q1, Q2, and Q3 of 2016. The primary driver to the increasing G&A expenses in Q2 and Q3 were pre-commercialization activities and to a smaller degree an increase in headcount. Those pre-commercialization activities were discontinued in late Q3. With regard to cash used in operations we see the cash - where we can see the cash impact of these operating activities net of non-cash expenses in the statement of cash flow, specifically cash used in operations. If we look specifically at the line item, we see cash used in operations were $69.8 million, $62 million and again $62.4 million in Q1, Q2 and Q3 respectively. Importantly, cash used in Q3 of $62.4 million includes $6 million in convertible notes semi-annual interest payments. Therefore, the actual cash used by our operating activities net of those interest payments was $56 million. This gives us more clarity on the reduction in R&D cash expenses as the Prepare Phase 3 older adults trial and the Phase 2 older adult trial wound down in that period. The third quarter trends in R&D and G&A expense, cash used in operations and the restructuring plan announced today provide insight into our 2017 financials. Let’s go to the next slide please. With an understanding of the expenses in cash flows in 2016 we can now discuss the 2017 operational priorities and financials. As shown on slide 85, we can see that the discussion today will focus our R&D activities on the RSV vaccine primarily the Prepare trial which is our Phase 3 trial in infants via maternal immunization, a new Phase 2 trial in older adults that will explore regimen and adjuvants and finally our newly announced Zika program where we will continue our ongoing Phase 1 enabling work which includes non-human primate challenge studies as well as the goal of entering the Phase 2 immunogenicity and safety study in the New Year. We will continue our pre-clinical work in nanoparticle influenza and our new product development work. Next slide, let me speak about corporate restructuring. The corporate restructuring announced today was based on the 2017 operating plan I've just reviewed and an analysis of the resources necessary to execute on that plan. As stated in the press release and earlier in today’s comments, the plan was based on three key objectives. The first was to prioritize development activities to achieve clinical data events in 2017. The second was to reduce cash burn, extend the financial horizon and minimize near-term dilution. And finally, we wanted to maintain our core operational competencies in order to execute on these development plans and others in the future. There are a number of key components of these restructuring, the first as announced is an approximate 30% reduction in full time employees. In addition, there were significant other expense reductions that we have implemented here in the company including R&D expense reductions both project and non-project related expense reductions. G&A expense reductions specifically pre-commercialization activities and others and property, plant and equipment forecasted investments in 2017 will reduce relative to 2016. The combination of all of these items leads Novavax to estimate that we will have a reduction in cash burn of between $70 million and $100 million in 2017 relative to 2016. Next slide please. With that, let’s talk specifically about our financial outlook. For 2016 fourth quarter relative to Q1 through Q3 of 2016 we expect an increase in revenue under the Bill & Melinda Gates Foundation grant resulting from an increased enrollment in the prepared trial. We expect consistent R&D expenses with Q3 due to the final visit for all participants in the Resolve trial. And finally we expect a decrease in G&A expenses as pre-commercialization activities are discontinued. The fourth quarter will also include severance costs related to the headcount reduction of between $3 million to $4 million. In 2017 relative to 2016 again we expect a revenue increase under the Bill & Melinda Gates Foundation grant related to the ongoing Prepare trial. We do expect R&D expenses to be substantially lower due to lower project, employee and other expenses. And G&A expenses will be substantially lower due to pre-commercialization employee and other expense reductions. In summary, we have the liquidity to fund this operating plan as described today into 2018. For 2017 financial and operating plan supports Novavax’s aim to discover, develop and commercialize ground breaking nanoparticle vaccines. We now have a company with the resources to execute on the development plan discussed today with over $300 million in cash on the balance sheet and the support of our partners at Bill & Melinda Gates Foundation through their $89 million grant. We have a high value portfolio of products which include the RSV Vaccine in both maternal immunization settings as well as settings in older adults and pediatrics and finally, we are introducing an exciting new program in the Zika vaccine which we expect to have in Phase 1 next year. All of this provides us with an operating plan with 2017 valuation milestones of potential Phase 3 Prepare trial interim data pending our discussions with the FDA, a Phase 2 older adults trial data, and finally data from our Zika trial. With that, let me turn the call back over to Stan.

Thanks Buck. So, you've now heard from the whole team and I think you've heard a lot of excitement about where we are. It’s a lot better place then where we were 60 days ago, when we were surprised by elderly data. I think we’ve got lot of insight, and lot of work. We have a lot of insight into what we think the fix is for that and plus we haven’t skipped a beat on our Phase 3 maternal program. So, we are excited, we're in a good place, we are going to conclude good 2017 and with that I will turn it over to you guys if you guys are still hanging around.

[Operator Instructions] Our first question comes from the line of Joel Beatty with Citi.

Hi. Good afternoon. Thanks for the extensive presentation and the questions. The first question is regarding the focus and the need for higher immunological response rates and higher affinity immunological responses, will you be able to go back and look at the data from the Phase 3 trial and assess the immunological responses in those patients, you know our early in the piece of ahead events?

Yes, hi, Joel, Greg here. So, yes, that I think what we are at now is we’ve developed what we is an important assay and we are beginning to start that work. So, the idea here is we will have several months and by the time we have the serial from the E205 trial, I think we have a very good idea whether or not we will have [indiscernible] and whether these immune measures are going to provide an extra window into the analysis. I will say, Lou alluded to it. We also have some of the analysis being done on the PCA itself and I think again we will be able to share that information in the coming few months. Our goal is to have a definitive picture of the importance of immunogenicity and time to interpret and use these assays for the E205 trial we are again we are looking ways to improve both the quality and quantity of antibody with adjuvants or with one or two dose regimens.

Okay, great. And then if I could ask one other question, how is the enrollment in the Prepare trial going, are you able to give a timeline when you are expecting my readout?

There are two questions here. As you know, we are not usually, we don’t give guidance on enrollment. I think just, I can say in general the trial is going quite well and we are in discussion with FDA on the interim unwinding and we are thinking towards the end of this year or certainly next year.

Sorry, into next year?

Yes, next year, next year we could have that result.

Okay, thank you.

Thank you. Our next question comes from the line of Jessica Fye with J.P. Morgan. Your line is open.

Hey, guys, this is Ryan on for Jess, I appreciate you taking our questions. May be, can you help us understand little bit more about the cost cutting, you know those cost savings of $70 million to $100 million seems like a pretty wide range, so could you give us little bit more color on sort of what factors would put you either the high-end or the lower-end of that range?

Yes, Ryan, thank you for the question. I think just to start out, we have spent a lot of time evaluating the operating plan, the consequences of the investments under that plan and we do believe that that range on the call today is an appropriate range to provide guidance for every one through the end of 2017. Obviously, will help to tighten up some of that ranges we get further into the year. I think there are lot of impacts to the estimates that we put together to get to that number. Frankly, one of the key components would be timing of investments in some of these clinical trials and when they occur as well as other investments that would be made alongside the company to build out. So, as Greg mentioned today, sometimes in our explorations to understand the outcomes of these trials we develop a new assay. We have new learnings and new understandings, those can be impacts to our cost as we go forward and we need to be able to explore those. So, it’s a very high level response, but I will leave that with you at this point in time.

And high level, I mean at the high-end of that range, does that include some contemplation of starting another Phase 3 study in older adults if you were able to do it next fall?

I think the guidance I have given you today includes the operating plan that we've discussed. So there is not a Phase 3 trial in that guidance.

Okay great. Thank you.

In older adults, yes, we continue with the Prepare maternal immunization trial. Thank you, Greg. That's right.

Thank you. Our next question comes from the line of Ted Tenthoff with Piper Jaffray. Your line is open.

Great, thank you very much again thanks for the very thorough update. So we’ll have the Phase 2 data from the elderly patients. When do you think we could get that data? And I appreciate how this is all stitched together with respect to the financial guidance changing going forward. You know what is the most recent guidance in terms of when we should expect data from Prepare?

Well I think, hey Ted its Stan. I think what we’ve told you is we’re projecting second half of ‘17 and that's based upon two things. It’s based upon the case rate that we get from now until mid ‘17 and number two, successful discussions with the FDA which we've already initiated. So I don’t think I can get it closer to than some time in the second half.

I might not have heard that during the presentation. So that’s helpful. And then with respect to Prepare?

That was with respect to Prepare. That was maternal immunization.

So maternal immunization will get an update in the second half of 2017 you said I'm sorry?

And we're hoping that will be efficacy view into what that front.

And in terms of the Phase 2, the new Phase 2 for elderly, sorry?

So that, I think at the latest that will be the third quarter.

That was very helpful and I look forward to hearing more about the Zika program too. So this is really very helpful to help us understand where things are going from here.

Thanks Ted.

Thank you. Our next question comes from the line of Kevin DeGeeter with Ladenburg.

Hey, good evening guys. Thanks for the call for the questions. I guess two from me. Just your current thoughts about your potential path forward that would include potential a combination for influenza in light of the data that Lou described earlier in this call describing in the Phase 3 what appears to be a reduction in the potential efficacy benefit of the vaccine in patients co-administered?

Sure. I think that you have to understand that that this is an instance where influenza vaccine, another manufacturer's influenza vaccine with the variety of components that relatively crude in activated influenza vaccine contains is given simultaneously and in another injection site in the subject receiving RSV F. For our programs going forward we would take a much different approach. We would use a specifically engineered nano particles flu vaccine which had characteristics or formulation characteristics not unlike the RSV F vaccine could be combined with it directly and we would anticipate most likely would be delivered in concert with an adjuvant that would allow both to have a strong immunogenicity. But I think in the case the key take home is that in the combination, in the Novavax combination vaccine we would engineer the doses and the adjuvant combination to make sure that we got strong responses to both. I think we can probably in that instance overcome the interference of the flu component and we would design the vaccine specifically to do that.

Okay, great. That's really helpful and then maybe one more for me then I’ll get back in the queue. I think this one is probably for Greg. Greg, one of the things we've been trying to just get our mind around is just how to think about the clinical relevance of the PCA assay in the context of this elderly population. The only assay is being used and clinically validated primarily in neonates and in pediatric populations. Are you doing any work to characterize whether or not this is really the right cell I got to be you doing any work to characterize whether or not this is really the right surrogate to be thinking about in the elderly and does the Phase 3 data sort of allow for any analysis on those lines.

And I think given this is what in the part I was alluding to maybe I can expand on a little bit. So this look at the antibody affinity we think it's quite important and what it's revealed to us is we have what looks like a population that of folks that have RSV type 2 specific immunity and then those that don't. And in those that don't we think that when we induce immunity the PCA measure is not lining up with what we had expected. So in young healthy immune systems when we measured PCA it was high affinity PCA. So in the older docks as I was showing you we have that was we were surprised to observe that we could measure PCA in some vaccines but it had very low affinity. So we think that's a very important window and to what we need to achieve with our immunization. And as Joe asked a little earlier so now we can reflect back with this new measure and look at our E201 our E202 and our E310 sera and see if it meaningfully predicts our ability to indicate a protective immune response. I think it is quite likely since affinity is a known factor for listing good protection, but could be a meaningful window in which to look for immune correlative risk and interpret our formulation data. So we’re quite excited about using this assay and that's why I felt like we want to share with you tonight. We will be looking through. We’ve got a lot of archives here of course. We have a very unique clinical data set and PCR of positive subject. So it’s going to be very interesting over the next few months for us to go through this and do that very analysis.

Okay, great. Thank you.

I think to answer your question I think high affinity PCA is very meaningful. You know that we induce in animals that seems what we are inducing in our Prepare study and I think went through us a curveball is the fact that there is the hallmark of the immunosenescence in older adults has manifested itself as an absence of what looks like RSV specific immunity. We assumed that of the many, many years of exposure of the older adult population with prime everybody what we didn't really calculate for was the fact that some of those in fact that memory would be knocked off as maybe with CMV infection to the loss of B cells. So the assay has provided a window in the population we’re in. I think it provides a window and provides real confidence that our unitization in maternal is very, very good and I think it’s going to give us guidance as we select our formulation going forward for older adults.

Okay great and then just one small clarification on that. I really appreciate the thorough answer. With regard to validating that assay you are going to do that against sera of from an adult population or from..

Yes.

Okay thank you.

We can take our efficacy trials now we have sera, we know the attack rate, we know who got RSD. So we have a set of windows to evaluate the meaning of this assay against the observed efficacy in these three trials. So we’re quite, you know we’re very eager we’re beginning to get into that analysis and we’ll look forward to sharing with you the results in the near future. Anything to add there Lou?

No, I think that the data that we have in hand and the array of samples that we have in hand as Greg said is quite unique. One of the interesting issues about understanding especially in an elderly population who are affected by what in some years for example as in the Phase 3 years relatively infrequent disease is that you don't know in a person who is not sick whether they were exposed or whether they were not exposed or whether they were exposed and resistant to exposure. So here we have the opportunity of looking at the people who got sick and essentially are trying to establish a correlative failure if you will and then contrasting those with matched individuals who were like them in every other way, but did not get sick. So that’s one of the directions that we’re going to be exploring that will take quite a lot of assay where we think it’s going to be illuminating at the end of the day.

Great, thanks so much.

Thank you. [Operator Instructions] Our next question comes from the line of George Zavoico with JonesTrading. Your line is open.

Hi, thanks everyone for that excellent update and summary. A couple of questions about Zika first, recently Sanofi received I think $40 million plus BARDA grant, Florida provided $25 million from its own coffers I think to study development of Zika vaccine. Can you tap into any of these external sources for funding?

Hi thanks for that question. This is James. So certainly we’re looking at multiple lines of external funding from other government sources as well as from BARDA. And at this time, I believe that the BARDA funding for last fiscal have been determined, but we’re looking forward to exploring other opportunities, especially when we have the non-human primate data in hand in January of 2017.

Okay, so if it doesn’t work out, you might get it perhaps in 2018 and given the length of time for review.

Yes, we’re going to work on it. I mean this is – we think the U.S. government is recognizing, this is an important capuchin and we know that there is funding activity going on. So I think we will poised to start to try to obtain that funding in the coming year.

And then…

Fiscal 2018, which starts in October.

Okay, and then for RSV again, the Phase 2 study that you’re going to start in next year, this is strictly an immunization study, so you don’t have to worry about what the attack rate is for next year right? But will you also be doing a secondary endpoint – secondary efficacy endpoint like you did with the primary for the first Phase 2 trial?

Well, we can observe to see whether that there is a significant attack rate or not, but remember we’ll be studying multiple formulations in a relatively small trial. Now the trial will eventually span the RSV season in the southern hemisphere.

Okay.

And so yes, we can we can be opportunistic and characterize any respiratory infections that can occur.

But I think George the key here is when we get these data, we will be using different tools to measure this and was a really cool analysis. We will know a lot more about the type of immune response, each of the arms of the trial gives or nearly have.

I think that’s true and the other thing in the trial will be of a size that we wouldn’t be able to make, draw efficacy conclusions anyway, but we can monitor rate.

But given the lack of history of attack rates from year-to-year, this is going to be an interesting endpoint to really figure out to see how frequently you might get an outlier season like you did for your Phase 3?

Yes, we’re not really in quite a debt. We recognize the importance of that. We’re not really incorporating that. We've scaled back Phase 2. We want to establish in immune response that we think is as predictive of protection and we as mentioned I think we have an archive of information from these three trials that are very, very rich that we think we can learn from before we go back into efficacy study.

Okay.

We also know – I just would also point out that the ACIP has an interest in adults are city surveillance and they began to, they've begun to fund some centers to do older adult surveillance, which is new and represents our interest in the disease burden, in addition to the pediatric surveillance that is going on. So I think we did present our data at ACIP and they have a continued interest in RSV and they recognize that their surveillance is to improve it. So we hope we can take advantage of some of that information that’s going to be generated this year and the coming year.

Okay. And you were – also at one point talking about doing impedes trial, moving on a Phase 2 impede something in your future. You didn’t talk so much about that on the call, is that still on the final stages…

No, in our checklist – it’s in our checklist George. We just haven’t put it on the calendar yet. We are anxious to start a Phase 2 B trial and we could start one next year, we just have to put it on the calendar, so we’re not talking about it yet.

Okay, and with regards back to ZIKV, you mentioned the cost for your reactivity, is this, and it sounds to me that you could apply this – bit of approach, you could apply this for dengue. Are you considering dengue as a new opportunity, because you did have the opportunity as one of your financial goals?

So I think the important thing to note about that quaternary epitope in fact that it can serve across those sleeper [ph] viruses is the fact that it is unlikely to change. So as we look at time and the effects of Zika presenting themselves along with the change in Zika virus, we feel that our target is more of a static target in terms of being around for a long time. Coupling that with Matrix, we're going to have an outstanding fact against that particular virus. And that’s I think the importance of the quaternary epitope.

Again Zika, but would you be able to apply it to dengue?

Yes, it’s possible, but that’s not our first target right now.

Yes, yes, of course, just speculating. Now one last question on Zika, and then I'll get back into the queue. I was listening to back in [indiscernible] speak about Zika and even in Brazil, some of the people there are saying that you do not expect the second wave of widespread Zika infections similar like they had last year. So in terms of the [indiscernible] do you expect these kinds of peaks to sort of flatten out over time and this person actually said that maybe by the end of this year by the end of next year, everyone in Puerto Rico for example would be exposed, in which state if we do a trial, would you have to preselect for those who were exposed and having the antibodies already and those who have some antibodies already versus those that have not been exposed, it is just to complicate your planning?

I think that’s more of a complex question. When one looks at the transmission of Zika virus there are many models out there. Very recently this past Sunday and on 60 Minutes, we heard Dr. Falchuk speak to that and the concern as Zika being of prominence within the United States and other areas for the foreseeable future. So, although there’s many different models out there, I don’t think that we’re looking at Zika as not being an issue for the United States for the next several years. In terms of the population of Brazil or other areas of high transmission, there is historically some evidence that prior flavivirus infection might protect an individual for a period of time after exposure to that flavivirus. But for a virus that's been discovered since 1947, we really have a dearth of information about Zika virus. So more to follow as our [indiscernible] gets better, but many experts in the field project Zika virus to be ongoing for the next several years.

Okay, great. Thank you all very much. I’ll be back in queue.

Thank you. I’m not showing any further questions at this time. I would now like to turn the call back over to Stanley Erck for any further remarks.

Thanks. Thanks everybody for both being patient with us by when we moved the Analyst Day for a month. We’ve - turns out in retrospect, I’m really glad we did it. We have learned a lot of stuff that we can be a lot more articulate about on this call. And now we’ve got a plan to recite about going forward. So thanks a lot. We’ll look forward to seeing you at various investor meetings in the coming months and reporting data throughout 2017. And with that I will sign off without one political comment.

Thanks for that Stanley.

Ladies and gentlemen, thank you for participating in today’s conference. This concludes the program and you may now disconnect. Everyone have a great day.