WHEN: Today, Tuesday, February 9th 

WHERE: CNBC’s “Healthy Returns Spotlight: Prognosis for Recovery”

Following is the unofficial transcript of a CNBC interview with Alex Gorsky, Johnson & Johnson Chairman & CEO, and CNBC’s Senior Health & Science Reporter Meg Tirrell live during CNBC’s Healthy Returns Spotlight today, Tuesday, February 9th. Full video will be available at cnbc.com/healthy-returns.

All references must be sourced to CNBC’s Healthy Returns Spotlight.

Realtime Transcription by www.RealtimeTranscription.com

MEG TIRRELL: Alex Gorsky, thank you so much for being with us here at Healthy Returns.  I’ve got to start by asking you about, you know, when you got these data on your one-shot vaccine.  I guess it was just the week before last.  What did you think when you saw these results?

ALEX GORSKY: Well, Meg, first of all, it’s wonderful to be here.  Thanks to you and Tyler for having me, and to participate in the program.  And, look, as you can imagine, my first thought was, wow, this is so important for the world right now, and I couldn’t help but just reflect on the last year and the dedication, the commitment, the drive, the 24/7, you know, round-the-clock efforts that our scientists, our physicians, and all of our colleagues at J&J have been putting forth really to make this possible.

MEG TIRRELL: Well, you were really the only company in the leading group to focus on a one-shot vaccine.  And when the results came in, you know, the worldwide efficacy number was 66 percent; 72 percent here in the U.S.; 57 percent in South Africa.  You know, some looked at those results, looked at the results from Pfizer and Moderna, 95 percent efficacy.  Of course, those trials were done at an earlier time, without these variants circulating, that we know of.  But some said, okay, this is going to be a second-tier vaccine, it will be used in different ways.  Do you think that’s fair?  How do you think about how your vaccine will be used in this pandemic?

ALEX GORSKY: Well, overall, Meg, what I would say is the data on all of these vaccines is really great news, not only for the United States, but for the world.  To think that within a relatively short period of time, let’s just say 12 months, that we’ve got two vaccines approved using a brand-new platform; ours, you know, having now been submitted for an emergency use authorization.  There was a lot of — there were a lot of questions.  There was a lot of doubt whether or not, you know, the biopharmaceutical industry could actually be able to deliver on that kind of a promise, particularly under pandemic conditions.  And to see the rate and pace of discovery, of development, the coordination that’s taken place between companies, with academic centers, to make all of this possible is remarkable, to say the least.  And, you know, as we watched the data come in, certainly it gave us a lot of reasons to be optimistic, you know, based upon a lot of the early science that we saw with our platform, even before COVID-19, where we had used it in other areas, such as Ebola, Zika, in HIV, and as we got our Phase 1A and 2 data, we remained very encouraged based on the antibody response that we were able to produce, as well as other information we gathered.  And then when we saw our results, again, we realized that this was very important data for the world.  And, look, all of us realize that, you know, we’re seeing Darwinian evolution of biology evolve literally in real time in front of us.  So making some comparisons directly is very difficult.  What we think is most important is to add another tool to the armamentarium, so to speak, where we can show safety, that we can show effectiveness, that we can show the convenience, potentially, of a single shot that can be delivered logistically around the world in a fairly straightforward manner, we think that’s going to be a really important option, again, for patients and for healthcare systems around the world.

MEG TIRRELL: Well, an important point, also, for your vaccine, is it prevented 100 percent of hospitalizations and deaths everywhere where you tested it, right?  Even in — you know, against that B.1.351 variant in South Africa.  Just tell us about the importance of a finding like that.

ALEX GORSKY: Well, Meg, look, I think one thing we found throughout this entire pandemic is really, you know, leaning in and making sure that we’re following the science and following it very carefully.  You know, we made a commitment very early on with many of my other colleagues, you know, across the biopharmaceutical industry to make sure that we did that, and we’ve been doing our very best at Johnson & Johnson to make sure that we’ve been open, transparent with not only our protocols and the way that these trials were conducted, all as part of an effort to ensure that we’ve got the trust and the confidence of people and patients around the world, but also so that the regulators and so the others could really see the data.  And as we’ve gone through this, look, I think a lot of us are learning real time, there are a lot of facts, there are a lot of figures for us to go through, and clearly we intend to do just that as we go through the regulatory process.  But what I think is most important for patients to know is that they can have an option that keeps them potentially from getting very, very sick, to keep them from being hospitalized, and potentially to save them, you know, from the ultimate, from dying, in these kind of conditions.  And so, again, we’re working very hard on pulling all those data sets together.  We’re really looking forward to having that conversation with regulators.  And in the meantime, as I’m sure you can appreciate, we’re working very hard around our manufacturing process, in building up the capacity.  Because as we have all seen, as important as discovering and developing a safe and effective vaccine is making sure we can actually distribute and administer it to as many patients as possible, particularly during this particular point of the spread of the virus.

MEG TIRRELL: Well, I’ve got a lot of questions for you on that as well, but I want to ask you also about your strategy to test one dose first.  But you’re also testing two shots, similarly to what we’ve seen from all the other companies, but J&J thinking that it would be best if you could have a one-dose vaccine went that route first.  What do you expect in terms of the timing of data on two doses and whether with two doses you might see a similar number of efficacy as the other two-dose vaccines?

ALEX GORSKY: Look, Meg, all along we have tried to do our best to get the right combination of efficacy, of safety, of convenience, and overall to increase the number of doses that could actually be administered.  And so as far back as January, when our scientists first got the genetic code and began developing different variants of this platform itself to say what is that optimal mix that we should utilize when we look at things based upon our history and our experience with this particular AdVac vector, the 26, which the way that I would describe it is almost think of it as the spaceship that’s going to deliver the payload, so to speak.  And our scientists knew early on that it would be most important to perhaps measure several times and cut once to try and, again, get this right balance between all those different issues that we were trying to influence.  And, you know, based upon those early results, I think it gave them great confidence.  That was reinforced with what we saw in the 1/2a.  Again, we built a lot of information since then, and even in our Phase III trial of 45,000 patients.  And what’s really important is this included patients from around the world.  I think just over 40 percent of our patients, Meg, were right here in the United States.  About another 40 percent were in Latin America, many of them in Northern Brazil, and approximately 15 percent or more were in South Africa.  So these were really at the hot spots, where unfortunately this virus has continued to mutate, has continued to evolve.  And we went into those areas to conduct the trial, and at the same time we realized that, look, this is something that we need to prepare for over the next several years.  So we were looking at a second dose, as we talked about.  We expect to have the results of that trial later this year.  And I think, you know, that will give us an even better sense of the profile and the best way to utilize our vaccine and perhaps even others.

MEG TIRRELL: Well, a lot of important considerations there.  Of course with supply, you cut it in half if you decide to go with two doses.  You said you should have those data later this year.  Can you tell us, first half, second half?

ALEX GORSKY: We would expect to have those available by the second half of the year.  Again, some of that, Meg, as you well know, depends on the incidence rate of the disease and what we’re seeing.  But our clinical trial program is commencing, really at the pace that we had anticipated.  And so we look forward to getting those results in the back end of 2021.

MEG TIRRELL: Well, we’re certainly giving you enough infection right now in the U.S. to potentially expedite those results, which is the one silver lining to having a lot of cases.  But they are coming down.  Tell me what is going on at Johnson & Johnson right now in terms of, you know, preparing for the FDA Advisory Committee meeting coming up February 26th.  You’ve got your scientists, I’m sure, the team ready to discuss that with the FDA.  And then what’s happening on the manufacturing side, getting ready to distribute this vaccine?

ALEX GORSKY: Well, look, we’ve got a comprehensive array of activities going on simultaneously in real time.  I mean, first and foremost our priority is to work with the FDA towards the EUA, and so our teams are working around the clock to get the summary information prepared and to prepare in advance for the dialogue with the committee.  And again, we remain very optimistic and very hopeful.  You know, simultaneous to that we’re working full speed around production, around manufacturing, around what can we do to make sure that not only are all of our processes and systems — and still need to undergo some regulatory review before we can actually start shipping and distribution, that that all goes as planned as part of the normal review process.  At the same time, look, we put together a very extensive and robust network of partners to work with, here in the United States, in Europe, and other parts of the world.  We’ve got partners who are helping us with our drug substance, to actually make the vaccine itself.  We have other partners to help us on what is called the “fill and finish” is where you actually put it into the vials and prepare for shipment.  And so we’re going through that process as we speak.  We’re trying to do our best to be able to maximize things like I just talked about, you know, whether it’s yield, lines of distribution, and to be able to fulfill all of our contractual obligations around the world.  At the same time we’re working hand in hand with a lot of our other partners, as we have been for almost the past year.  And that includes people actually involved in the distribution, whether it’s the United States government, whether it’s our partners overseas, other people involved, you know, in that supply chain to make sure that, you know, we do everything possible to make it easy, to make it efficient, to get those doses where they matter most, and that’s actually when it gets into people’s arms.

MEG TIRRELL: Well, how many doses will you have available when the FDA gives the green light and, as you said, you’re ready to start shipping immediately?  How many doses?

ALEX GORSKY: Well, look, Meg, I’m not going to speculate on the exact number because a lot of it depends on exactly what happens in the regulatory process.  But we remain extremely confident that we’ll meet our commitments, in terms of the United States, in providing 100 million doses by June of this year.  And, again, we’re working around the clock to make that happen.

MEG TIRRELL: Well, Mark McClellan, one of your board members, a former FDA Commissioner, was on with Shep Smith the end of January, and he had said J&J hopes to have enough for 100 million Americans by April.  Is that possible?

ALEX GORSKY: Again, Meg, as I’m sure you can appreciate, we’ve got a lot going on right now, and we will meet our commitments, as I just said.  At the same time, we’re doing everything we possibly can to safely and effectively accelerate, you know, again, assuming that authorization goes through, to get those doses to, obviously, patients here in the United States, but to really patients around the world who I think are really anticipating having access to something that’s a single shot, that logistically can be deployed in a relatively convenient way, and that most importantly offers the kind of efficacy and safety profile that’s really going to make a difference as we take on COVID-19.

MEG TIRRELL: Well, there’s been so much focus, obviously, on manufacturing of these vaccines.  The world is paying way more attention to this than it ever usually does to drug and vaccine manufacturers for obvious reasons.  And so we saw similar issues for Pfizer when it had to cut its supply forecast in half, you know, for the end of 2020, just because there were some bottlenecks at the beginning of the program.  You know, the New York Times reported that J&J was perhaps two months behind production schedule because of some bottlenecks in manufacturing.  Did you have hiccups like that?

ALEX GORSKY: Well, Meg, look, never in our history as the biopharmaceutical industry, any company, let alone Johnson & Johnson, ramped up at this kind of pace and rate.  And so, look, we’ve listened, we’ve learned.  We’re watching others very closely to do everything we possibly can to smooth out that ramp-up that you see early on.  And that’s the way we continue to approach it.  We’re learning every step of the way.  Our partners are learning as they go along.  You know, we’re applying real time improvements to many aspects of our system, and I think every day we get more and more confidence in our ability to, you know, deliver as we meant to.  Again, we’re very hopeful that we can even accelerate that.  But it’s never — In these circumstances, it’s never a straight, linear shot.  There are always going to be things that come up along the way that you can’t predict, but I’m extremely confident in the rigor and how robust our process is, and our oversight of this to do our best and to deliver as much as we possibly can.

MEG TIRRELL: Well, we’re getting some great questions from the audience.  And one from Derrick is about the level of participation in your COVID-19 vaccine clinical trials from black and brown communities.  How much diversity did you see in your clinical trials to be able to ensure these vaccines work for everybody?

ALEX GORSKY: You know, one of our very first priorities from day 1 was making sure that this was a vaccine that could be used by everyone around the world, and particularly in minorities that have been disproportionately hurt by this pandemic.  And, you know, we’ve seen it here certainly in the United States where, you know, whether it’s morbidity and mortality can be up to three, four, five times worse in these communities than in others.  And so we knew that that was certainly a major priority for us in our trials.  Our clinical team did a great job.  I believe the most recent figures are, on a global basis, as much as 20 percent, and I believe here in the United States, it’s around 13 percent.  So we’ve been able to, again, pull together a robust data set, you know, across ethnicities, across genders, across age groups.  And again, we look really forward to sharing all that information with the advisory committee that we’ll be having here in a few weeks.

MEG TIRRELL: Another question I want to ask you about is, of course, the change in administration and whether that’s affected and how that’s affected your conversations with the federal government around your vaccine.  You know, Operation Warp Speed partnered with McKesson as the vaccine distributor.  Will that be the one that distributes your vaccine?  Just tell us about whether this process has changed at all with the new team in place.

ALEX GORSKY: You know, I’ve got to say, I’ve really been encouraged by our communications, our partnering, and our ongoing discussions that we’ve had with the government, you know, both early on, and they continue today.  You know, there’s literally not a day that goes by where either myself or members of our senior management team or, you know, other critical leaders are not in contact with them, trying to do, again, everything we can to — whether it’s on the file itself, from a regulatory point of view, the way that the clinical trials were coordinated, ensuring that that was done in a really comprehensive way, that was going to, you know, meet all the goals and objectives, the government as well as, you know, what we are trying to accomplish.  The same thing on the distribution side.  And so I found a significant level of openness and candor and give and take that, look, it’s been extremely helpful.  There’s no way I think we’d be in a position, even today, to be trying to make the decisions about the next several weeks if we didn’t have the kind of collaboration that we’re currently seeing.  And I think that’s been essential to our success every step of the way.  And as far as the distribution process going forward, look, I think it’s going to depend on a lot of things.  And we’ve worked with McKesson extensively throughout, you know, our history.  Recent history certainly, you know, they had a role in our drug distribution process.  We found them to be a very good partner.  And I think going forward it will be a balancing act, as we hopefully see more and more vaccines come on line, we’ll be able to open it to more and more points of distribution.  And that’s certainly the hope.  And again, I’m growing increasingly optimistic between — you know, assuming that, again, we get the thumbs-up from the FDA.  You combine that with the increased numbers that are being produced by Pfizer and Moderna, and those will result in significant differences that hopefully will alleviate a supply issue over the second quarter of 2021.

MEG TIRRELL: What kind of work is going on at J&J now on potentially having to update your vaccine for these new strains that we’re seeing circulating?

ALEX GORSKY: Well, you know, first of all, we’re continuing to look at our data set that we gathered in this current trial to see how it’s doing against some of the current mutations and variants.  And I think a critical advantage and a very important insight that our data set is going to provide is, for example, on the 1351 variant in South Africa.  As I mentioned earlier, I believe just north of 15 percent of our patients were recruited in South Africa.  Over 90 percent of those were, in fact, infected by this new variant, and we took a lot of different samples of information in building our data set.  So we’re going to gather, we believe, a lot of information to hopefully be able to paint an even clearer picture of how our vaccine works against this strain and potentially some of the others.  And that may provide insights for some of the other vaccines as well.  And again, this will be the first very large clinical data set to provide those kind of insights.  So it starts there.  Secondly, we already have teams working in parallel to say, okay, what would it take to develop the right kind of additional vaccine that could result in a bivalent, where we might bring two vaccines together, you know, at some point in the future, depending on the kind of outcomes that we see.  We think our platform gives that kind of capability.  And so we realize that, you know, at this kind of unique time we can’t wait; that we should do those things in parallel.  And again, I believe many of the other companies in the industry are taking similar tacks, so that hopefully with all of these best efforts we do our best to stay one step ahead.

MEG TIRRELL: Well, Johnson & Johnson, you know, is developing the COVID vaccine on a not-for-profit basis during the pandemic, you’ve said.  What do you expect for after the pandemic, if we can dream of such a magical world?  Will we still need COVID vaccines?  Do you expect this to turn into something like the flu, where we’re getting annual or every-few-year updates with COVID vaccines?

ALEX GORSKY: Well, wouldn’t we all like it to get back to normal as quickly as possible?  And that’s a big part of why we’re doing what we’re doing.  Because we want to help the world do exactly that.  And we knew that from the very beginning, given the situation that we were in, that a company the size and scale and the position of Johnson & Johnson, that the best thing, the right thing for us to do was to do it on a not-for-profit basis.  You know, we didn’t want that to get in the way of access.  We didn’t want cost, price to be an issue.  And I’m really proud of the efforts that we’ve made to do that.  And again, I think we’ll make that possible here in the very near future.  You know, going forward, look, it’s going to depend, and a lot of it’s going to depend on what happens with this virus.  You know, unfortunately, as it spreads it also can mutate.  And every time it mutates it’s almost like another click of the dial, so to speak, where we can see another variant, another mutation, that can have an impact on its ability, for example, to fend off antibodies or to have a different kind of response, not only to a therapeutic, but also to a vaccine.  Now there’s several schools of thought.  One would say that that risk could — is eminent, it’s real, as we’re seeing again happening in various places around the world.  And as it continues to spread, we could continue to see that evolution.  There’s other schools of thought supported by some epidemiologists who are experts in vaccines that, you know, would suggest that none of this — this particular virus is reaching a very high level of, as they would call it, “fitness” that would prevent it from evolving to a significantly greater degree, and therefore our vaccines should continue to show efficacy, and it would provide good production; and that, again, it could have quite an impact going forward.  Exactly where it lies, we don’t know today, Meg.  But, look, I’m hopeful that, you know, the current vaccines that we’re offering are going to make a big difference, I think especially over the next three, four, five months when we start talking hundreds of millions of doses certainly here in the United States but in other places around the world, we’ll start to see that.  We’re going to have to watch.  And as we do more and more PCR testing, as we gather more data, as we get more definitive data sets, I think we’ll have a better understanding of just how effective they are.  And then, look, I’m also optimistic, even about next generation, if we go there, of our ability to address that.  But I think most people feel that this will be something where likely for, yes, the next several years we’ll be getting a COVID-19 shot just like we would a flu shot.  Exactly what that shot is going to be comprised of, I don’t think we know today.  But I think we could all imagine a future where we’re living with this, but where we can keep the science at pace with the virus.  So you know, we can keep on living our lives.

MEG TIRRELL: We’ve got so many great questions from the audience.  I want to get to another one from Dan, who asks:  Do you believe that lessons learned in regards to the speed of COVID trials will provide an opportunity to speed clinical trial time frames overall?  And I guess I might broaden that question to ask you, I mean, how has this pandemic changed healthcare for us?  I mean, will these kinds of things, being able to do things so quickly, will that stick with us?  And what else will stick with us after this pandemic?

ALEX GORSKY: Well, Dan, I sure hope so, because I think we’ve learned some really important lessons here.  So, you know, let me start maybe first with just the clinical trial aspect and then take it more broadly across healthcare.  For clinical trials, we’ve learned a lot about the importance of data sciences, for example.  There’s no way we would be where we are today if our data scientists didn’t understand some of that initial genomic sequencing information that came across that, of course, was only made possible by those kind of capabilities.  You know, we then took that information and we ended up developing several different platforms, which we, you know, chose one particular.  Again, data science made that possible.  Data science made even the way that we chose our clinical trial sites — we were trying to project where we would see the greatest incidence rate.  You know, believe it or not, we started our clinical trials near the end of the summer.  There was almost some concern of what would our recruitment look like because we had seen a bit of a nadir in terms of infection rate at that time.  Now, unfortunately, that changed in a major way, but it also ensured that the sites we selected ultimately allowed us to get a lot of insights, you know, at a very rapid pace, as well.  So I think the way that, again, data science, analytics are applied to clinical trials, the sharing of information, the conversations that were taking place between the heads of R&D, between all these different pharmaceutical companies was truly remarkable.  The way that information was even shared with regulatory agencies, so that rather than it just being a hub-and-spoke approach between the company and the regulatory agency, there was sharing of information real time between companies so that we are able to take those insights, at times adjust our trials to, you know, again, help us be even more effective, more efficient as we were gathering data along the way.  The efforts, I think, that everyone has made to really try and to get more data with diverse populations, to recruit diverse populations into our trials during this whole process is certainly something that I would like to see us continue as an industry.  So I think those are some of the things.  Now, if you ask me more broadly about healthcare, I certainly hope we use this as a change in maybe the way that we think about it.  And the first one that comes to my mind is our prioritization of global public health.  You know, what we’ve learned throughout this experience is that if we don’t have strong, robust, sustainable global health programs, we don’t have national security, we don’t have economic security, we don’t have security as a society.  So making sure that we have got those systems, that we put the investments in place. And I realize that it’s always hard to invest in something that’s just trying to prevent from happening, but I think this has shown us that if we don’t do that, we are all vulnerable.  So a very robust public health program, I think, coming out of it.  You know, I think, too, it’s shown us the importance of health and wellness as well.  You know, throughout this, the healthier we are and we can be and how do we promote even more of that approach in health care, look, I think that could have an impact on health care pre-COVID, but it’s certainly shown us in a COVID environment the importance of that as well in long-term morbidity and mortality.  Next, it’s about reaching some of these communities that unfortunately don’t have access to the kind of health care that we should all expect, and that if we’re not reaching out, if we’re not making sure that we’ve got doctors and physicians and nurses of that community, if we’re not providing them with the right kind of education and doing a special outreach, that, you know, we’re not living up to our mission.  And so I think these are all lessons, whether it’s about our clinical trials or our approach to health care.  And, look, the other thing I would say in health care is, just to wrap it up, take up technology, whether it’s telehealth, telemedicine, again, the use of data and information real time, all of those things are on steroids right now and are going to have a long-term impact on the way we think about how health care is developed and how it’s delivered.

MEG TIRRELL: Alex Gorsky, fascinating conversation.  We’ll be seeing so much more from J&J in just the coming weeks with your vaccine going to the FDA.  Thank you so much for being with us.

ALEX GORSKY: Meg, it’s always a pleasure, and thank you.  Stay safe and stay healthy.

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