Valneva SE — FY2022 Form 20-F
Reporting period: Fiscal year ended December 31, 2022. This is an annual report, not a standalone Q4 filing; the supplied filing text does not provide separate Q4 financial results. Financial statements are in euros and prepared under IFRS.
Financial highlights
| Metric | FY2022 | FY2021 |
|---|---|---|
| Revenue | €361.3 million | €348.1 million |
| Product sales | €114.8 million | €63.0 million |
| Operating loss | €113.4 million | €61.4 million |
| Net loss | €143.3 million | €73.4 million |
| Adjusted EBITDA loss | €69.2 million | €47.1 million |
| Operating cash flow | €245.3 million used | €76.9 million generated |
| Cash and cash equivalents | €289.4 million | €346.7 million |
| Borrowings and lease liabilities | €152.4 million | €114.7 million |
FY2022 revenue growth was driven by product sales and recognition of revenue related to terminated or amended COVID-19 supply agreements. Other revenue included €169.2 million from the UK agreement and €110.8 million from the European Commission advance purchase agreement; these amounts are material to interpreting reported revenue. Pfizer agreement amendments resulted in a €45.9 million revenue reversal.
Cost of goods and services was €324.4 million, including €267.1 million attributed to the COVID segment. The company wrote down €176.9 million of remaining VLA2001 inventory at year-end; COVID-related inventory write-downs were €159.4 million in FY2022. Commercialized-products segment gross margin was 45.5%, versus 36.5% in FY2021, with the improvement attributed mainly to lower impairment and scrap of short-dated or expired products.
At year-end, total assets were €621.3 million and equity was €219.8 million. Cash fell by €59.3 million during the year. Operating cash use included a €147.7 million outflow from changes in non-current operating assets and liabilities, mainly related to refund liabilities. Financing cash inflows included share issuance and additional borrowing.
Material changes and business developments
- Product sales rose 82.3%. DUKORAL sales increased to €17.3 million from €2.4 million as travel markets recovered; IXIARO sales fell 8.4% to €41.3 million, partly reflecting lower U.S. Department of Defense orders. Third-party product sales rose 72.1% to €26.5 million.
- R&D expense declined 39.5% to €104.9 million, principally due to lower COVID-19 program costs and clinical-trial phasing. Management expected further R&D expense reductions in 2023, while anticipating higher spending over the medium to long term as other candidates advance.
- VLA2001 manufacturing was suspended in 2022 after EU orders were reduced. The company was evaluating repurposing or other uses for its Almeida manufacturing facility in Scotland and reported a planned workforce reduction of 20–25% from the workforce at the start of 2022.
- Valneva raised equity in 2022, including €90.5 million from Pfizer and approximately €102.9 million gross proceeds from an October offering. The share count was 138,367,482 at year-end.
Outlook, risks and unusual items
- Liquidity: Management said year-end cash was expected to fund current operating plans for at least 12 months after publication of the FY2022 financial statements. The company remains loss-making and says additional funding may be needed.
- Debt covenants: The Deerfield/OrbiMed loan carries a 9.95% stated rate, equivalent to 10.09% annually under its calculation method. It is secured by substantially all company assets, including intellectual property. Covenants include minimum liquidity of €35 million and a minimum revenue test; a breach could trigger additional interest and early repayment consequences.
- VLA1553: The FDA accepted the chikungunya vaccine BLA for Priority Review in February 2023, with a stated PDUFA goal date at the end of August 2023. Approval, commercial uptake, ACIP recommendations and any Priority Review Voucher remain uncertain. Management anticipated possible U.S. commercialization in late 2023 if approved.
- VLA15: Pfizer discontinued approximately half of enrolled participants in the Phase 3 Lyme disease trial following Good Clinical Practice violations at third-party trial sites. The companies aimed to preserve a potential 2025 filing timeline, subject to regulatory agreement and successful completion; delays or added costs remain possible.
- COVID agreements and accounting: Recognition of UK and EC agreement revenue depended on management judgments about remaining obligations and repayment likelihood. Auditors identified these significant agreement modifications as a critical audit matter. The company said potential repayment of EU advance payments was assessed as remote, but did not rule out questions about documented spending; Scottish grant terms also carry repayment conditions.
- Controls and audit: Management concluded disclosure controls and internal control over financial reporting were ineffective at year-end due to pervasive material weaknesses. The auditors issued an adverse opinion on internal controls, while expressing an unqualified opinion on the IFRS financial statements.
- Other key risks include continued operating losses, travel-dependent demand, manufacturing concentration and single-source suppliers, clinical and regulatory uncertainty, competition, foreign-exchange exposure, and the ability to repurpose or monetize COVID-era manufacturing capacity.
Key facts investors should verify
- How much future revenue and cash generation depends on non-recurring COVID agreement revenue, and whether any repayment obligations arise.
- VLA1553 FDA review outcome, inspection status, timing and commercial prospects, including the likelihood and value of any Priority Review Voucher.
- Regulatory-agency decisions on the VLA15 trial modifications, the impact of participant discontinuations, and resulting development costs and filing timing.
- Cash runway under updated forecasts, covenant compliance, debt service and any need for further financing.
- Progress on internal-control remediation and the operating plan and costs for the Almeida facility and workforce reduction.