Okay, good morning, everybody. Welcome to day two of Cantor's Global Healthcare Conference. I'm Kristen Kluska, one of the analysts at Cantor, and I'm pleased to be joined by Dr. Alison Moore, the President and CEO of Codexis. Thank you so much for being here. Thanks, Kristen. Great to be here. Love to have the opportunity. Of course. Maybe to kick things off, do you mind just providing us with a high-level overview, and then we'll jump into some specifics? Yeah. Codexis generates manufacturing solutions using highly engineered enzymes. We've been doing that successfully over the last 15 years. Every year, we supply metric tons of enzymes to the pharmaceutical industry. But what we're most excited about is in the last several years, rather than working with single enzymes, we've created a manufacturing platform that is comprised of enzymes that generates siRNA. It generates oligonucleotides. We're focused on optimizing it for the generation of siRNA, and we call that the ECO Synthesis Manufacturing Platform, ECO being Enzyme- catalyzed Oligonucleotide Synthesis. Okay, thanks. Before we talk about some of the work Codexis is doing, I think it would be great to kind of just take a step back, understand the RNA manufacturing approaches today. We've eight siRNA therapies on the market, many more in development. How de-risking is the mechanism now, and have we gotten much smarter in designing these therapies with time? Yeah. siRNA as a modality, I think, is really starting to shine. siRNAs were commercialized initially in smaller indications, but with the approval of inclisiran, have moved into much larger indications. There are three phase III cardiovascular trials ongoing, very large trials. We're seeing the pharmaceutical industry really take that step towards the very large opportunities. I think that siRNA as a modality has been proven now across several indications to be safe, effective, at very attractive dosing frequency, either quarterly or half yearly. What's fantastic about the modality is the whole transcriptome is, in theory, available and tractable as drug targeting. What's your prediction for the future of this class of medicines? I love that graph you have in your slide deck that talks about monoclonal antibodies and the emergence over time and perhaps what siRNA can follow suit. Yeah. I think that my own experience in advanced medicines and working on manufacturing technologies over the last decade, I think that we've had some groundbreaking fundamental science. However, in some of these precision or advanced medicines, maybe the production technologies have actually been lagging. Patients that could benefit from these transformative technologies and the commercial success that these technologies could achieve is maybe not quite where it needs to be for us really to have the medicines of the future that you're referring to in that big uptick. But I think all of the metrics indicate, so estimates are somewhere between 400 and 600 siRNA assets in various stages of development. There's more than 100 in the FDA database of clinical trials. I think what we are looking at is a lot of breadth in terms of indication, a lot of appetite for looking at very significant indications. I already mentioned cardiovascular, but also obesity related, a lot of interest in CNS targeting. I really do think that of all of the ways that we have been looking to advance medicine, siRNA is one of the most powerful modalities. Okay, so we are excited about the modality. Yes. Let us talk about how we can actually get there, right? Yes. Why can not one simply just scale up the traditional chemical synthesis? What are the barriers, and have people tried to find ways before, of course, Codexis? Yes. Traditional chemical synthesis has a long history, 40-year history, and the practitioners of that chemistry are very familiar with that chemistry, and it has become highly optimized. Yes, there are people scaling products, and there are large products such as inclisiran, so there are people in the market working with existing production technologies, of course. However, these technologies have some significant challenges. The maximum batch size for solid phase organic synthesis is about 7 kg- 10 kg. If you are making product for phase I clinical trial, you probably do not even notice that there is an issue. But if you have a successful commercial asset and you need to produce a metric ton of product a year, this becomes a very, very significant challenge. The way to scale up 10 kg at a time to a metric ton is you need a tremendous amount of stainless steel. That is one significant challenge, is the significant scale limitation. The second challenge that I would mention is current chemistry is incredibly solvent demanding. The use of acetonitrile is extremely significant. As the industry starts to multiply the number of tons that we are making, we will actually consume most of the acetonitrile supply. That could potentially become limiting, and it is certainly environmentally fairly tragic. The ECO Synthesis Platform is both scalable and aqueous. Just to immediately point out the differences there. Okay, thanks. Understanding these issues that related to the chemistry side of it, how should we be then translating that to the CapEx side of things? Will this even be more problematic for therapies that do not have rare disease pricing power, right? The greater supply and the COGS and all of that will essentially, will they still want to pursue these therapies knowing how expensive it will be? Yeah. It can be an expensive product at the moment. There is some sort of very simple, rough math, and that is, and we have benchmarked this with folks that are actually building facilities at the moment. Roughly speaking, $1 billion of stainless steel will result in a plant that has an output of about a metric ton annually. $1 billion stainless steel gives you a metric ton. All of that capital is depreciated against cost of goods manufactured. That plays out in some way. If that is the investment of an innovator company, that will play out directly in costs. If that investment is via a CDMO, it ultimately will play out in terms of price to the customer. The ECO Synthesis Manufacturing Platform, we estimate to be about 70% more capital efficient, so the same kind of output for 70% less capital. Okay. When we think of chemical synthesis, is the process the same for all siRNAs, or are there specific profiles within each siRNA that can make the complexity either easier or different when we think about nucleotides and different factors? Yeah. The kind of chemistry, solid phase oligonucleotide synthesis, is a cumulative polymerization that is very dependent on the coupling efficiency of progressive nucleotides. What that means is if you are making a small oligonucleotide, you can achieve relatively high purity. The longer the nucleotide that you are synthesizing, even if you have greater than 99% coupling efficiency, just the simple math of making a 20-mer or a 40-mer or something longer, you will start to have reductions in synthesis overall productivity. The longer the oligonucleotide, yes, the more challenging it is to make. Which is why ligation approaches using ligase enzymes is becoming very sought after in the industry, and I think we can talk about that. In general, certainly all siRNAs are manufactured currently using solid phase organic synthesis. Very long oligonucleotides, such as mRNAs, are manufactured using in vitro translation. I know some of the history with ECO Synthesis came from Codexis already has so many great relationships with pharma, and some of these were inbound requests that you then considered when coming up with this platform. Given you do have several relationships with companies that are developing these therapies, what are the top complaints or issues you hear about the traditional chemical synthesis? Yeah. The types of customers that we are working with currently and what their interests are really fall into three categories. One is scale. Customers that are working on an asset that they are developing in the clinic, and they know that if they are successful, they will need to generate a large quantity of material, and they already understand that current methodology will be limiting to their commercial objective. That is number one. Number two is control over product quality. We also have customers who, when they have scaled or tried to scale their process or moved their production process from one facility to another, are interested in ECO Synthesis-derived material because of the ability to generate highly reproducible, high-quality product. Then the third reason why our customers are engaging with us is the opportunity to have stereocontrol of the siRNA molecule. siRNA molecules have phosphorothioates at either end. Those confer some stereochemistry, and at the moment, that is completely random when it is manufactured chemically. We have some customers who are coming to us who understand that there may be an opportunity for their product related to stereocontrol, which we can jump into a little bit more if you wish, and they are coming to us. Those are some of the inbound reasons that customers are approaching us. Okay. Now that we have a good sense of that framework, let us jump right in and talk about what Codexis is doing. First, what ways to date has the company proven that they are able to manufacture these products without sacrificing any of the quality or the purity? Yeah. We have been using model sequences that are well understood and can be readily compared by our industry colleagues. We have presented information at various TIDES conferences showing our ability to generate inclisiran, as an example. We also have now worked with numerous pharmaceutical company sequences, so we have a lot of sequence experience now. We have also described what our specification would look like in terms of product quality. We often get questions about excipients since we are using enzymes as our primary method of manufacture. We often get asked about product quality and the ability to remove enzymes, and we have also shown product quality data at the TIDES conferences to show that there is no residual enzyme. What about on demonstrating scalability and reproducibility? Yeah. We are working hard on that. Every time we give an update, we try to give an update on where we're at with scale. We are manufacturing routinely at 100 g in our innovation lab at Codexis. By the end of this year or the beginning of next year, we aim to be at about a half a kilo, and by the end of 2027, our objective is to be operating at kilo scale. Okay. There are several technical aspects to the story, and I'm hoping we can kind of break them down one by one here. First, Codexis has spent a lot of time talking about stereochemistry advances. What specifically is stereochemistry for those of us that haven't taken an O chem class in. Yeah. A few decades? And why does this matter when thinking about siRNA? Yeah. At both the three-prime and the five-prime end of most siRNA molecules, there are phosphorothioates, and those have been engineered into the molecules for stability, because the molecules need to get into the cell and past some of the normal cellular nucleases to actually make it to the machinery that allows the inhibition of the specific mRNA. This has been work that has been done by pioneering pharmaceutical companies. The phosphorothioate molecules at either end, there's often six of them, has been very established and beneficial for molecule stability. As I mentioned, there is no ability to control the orientation of those stereoisomers, so they will either exist in the R or the S, and the simple way is to think about it as what it's like your thumb on one side of your hand or the other. There is previous published information that demonstrates or initially suggested that particular orientations could be favorable in terms of product potency. There's also been some mechanistic studies that have been published that suggest reasons why particular stereo configurations could confer improved potency. Those relate to the ability to be more stable with respect to nuclease degradation, and they also appear to relate to binding to the RISC complex, which is the machinery that actually triggers the inhibition of the messenger RNA. So there's good mechanistic rationale for why stereoisomer control might matter biologically. There's published information that shows that certain stereoconfigurations have improved activity. The challenge, I think, has been historically is that making these stereopure materials chemically is very, very challenging. The beautiful thing about enzymes is they love to make one configuration or another. Codexis has been working very hard on demonstrating that we can dial in any stereoconfiguration at any point for those phosphorothioate molecules. We are generating our own biological data to interrogate the potential therapeutic opportunity of that. We will be providing updated information on that, probably by the end of the year. Okay, great. Another key update you had was on starting the process from a single nucleotide. What does this exactly mean, and how can this be done? Yeah. More recently, we presented a technical update that we have been able to initiate enzymatic polymerization, starting from a single nucleotide. The reason why this is important is most enzymatic polymerization of oligonucleotides, whether that be DNA or RNA, often needs a template or a starter to get going. The polymerase enzymes like to grab onto something to start their polymerization. What we have been using, which is very standard in the field, is we've been using a small starter oligo to initiate polymerization. That little starter oligo, which might be a 4-mer, is a chemical starter. For some customers, they just view that as a starting raw material. It's of less concern. For other customers, they have not really loved the idea of having a starter oligo, especially if we are manufacturing fragments, because as the fragments get smaller, the proportion of the fragment that is the starter oligo can be proportionally larger. We have evolved our enzymes so that they have the capability to initiate polymerization from just a single starting nucleotide. That means that we really can generate fragments of all sizes that are entirely enzymatic. Could you share some information on what the current competitive landscape looks like in terms of siRNA stereochemical control and single nucleotide synthesis? What's differentiating you versus what other people are working on right now? Okay. These are very different things. Sure. I will just start with the single nucleotide polymerization. I think that is very specific to the enzymatic field, and as far as I am aware, we are the only company that have showed the ability to do that. There are very few companies, but there are some working on enzymatic synthesis, and they certainly have not talked about that feature. Regarding stereochemistry, there is a much longer literature around stereochemistry of siRNA. I believe initially, brought to the fore by Wave Biotechnologies, and then there have been subsequent publications from Alnylam as an example. I know that other companies have been interested in stereocontrol, but I think always the big challenge has been how to generate the stereocontrolled molecules at a cost that is practical. I think that that has impaired really the ability to move forward at any pace with this potentially interesting opportunity for improved potency. Okay, thanks. How have you shown ECO Synthesis to be more friendly to the environment? Well, as I already mentioned, our synthesis is completely aqueous. The process mass intensity, PMI, of solid phase organic synthesis is about 3,000: 1. So what that means is 3,000 input grams for every 1 g of output. More than 90% of those other 3,000 g are solvent for solid phase organic synthesis. For the ECO Synthesis manufacturing platform, the synthesis is entirely aqueous. Some solvents may be required during purification, but these will be less than 10% of the total contemplated in a current siRNA production process. Okay. How is Codexis thinking about the opportunity for enzymatic synthesis to support this growing pipeline of next-generation RNA therapeutics, putting it all together? Well, how we're thinking about it is that we are working hard together with our customers. Our customers include CDMOs and innovators, and we're working in multiple ways. We are supporting specific preclinical assets that have that interest in the very large patient population and the opportunity of stereocontrol. We are working with CDMOs who are on the frontline of some of the most significant challenges with solid phase organic synthesis. Then we're also working with some pharmaceutical customers who, for the first time, understand that the ECO Synthesis Manufacturing Platform has a much simpler, smaller manufacturing footprint. We don't need any solvent tank farms, as one simple example. We are also working with customers who are interested in bringing the whole platform internally into their production capability because that was just not available to them with respect to solid phase organic synthesis. So we think that there are multiple pathways for us to participate in the whole ecosystem of siRNA production. How do you go about discussing all of these capabilities with these potential customers? Yeah. We are engaged, providing regular updates. Technically, we try to have our best technical updates available every TIDES Conference. We are continually dialoguing with our customers, and our customers are giving us feedback about what they like, what they don't like. We are adjusting our platform accordingly, and we are making extremely good progress in terms of moving forward into the pipelines of our customers' RNA medicines. Can you provide some color on conversations with the FDA Emerging Technologies team leading up to the meeting next quarter, and what kind of criteria or topics do you expect the agency to focus on? Yes. The ECO Synthesis Manufacturing Platform has been accepted, actually since 2024, into the Emerging Technology Program at the FDA. We spoke with the FDA last year and had a really engaging conversation with them. They were very interested in our technology, I think, with the lens of product quality and also process control. We are excited to have our next meeting with the Emerging Technologies team actually in a couple of weeks. We will be talking further with them about our product specifications because we want to remain very aligned with the agency on what their expectations are, what they expect to see in terms of product quality as we move products forward. We will also be talking to them about stereochemical control and how they view that in terms of potential comparability. We will also be talking to them about the categorization of, or the classification of starting materials. There is lots of potential opportunity and, of course, alignment is the primary objective from that meeting, staying aligned with regulatory expectations. Maybe just to close, what do you think is the most misunderstood or undervalued component to Codexis' valuation, and why should investors look at the company now? Codexis has a history of providing high quality enzymes on time, in full to the pharmaceutical industry for the last 15 years. Now we're working in a space where we are addressing a problem set in a dramatically technology advanced way. siRNA as a modality, as we discussed, is really one of the advanced medicine modalities that has almost unlimited potential, and we are starting to see pharmaceutical companies break into these very large populations. This will demand new production technologies. I would say it's either going to be Codexis or an alternative production technology. But in terms of looking at the opportunity that we have, I think it is very meaningful to the future of these medicines, and we have an outstanding technology that we are in the lead with. Great. Well, thank you so much, Alison. We're always rooting for you and appreciate you taking the time to be here today. Thank you very much. Really appreciate it, Kristen. Thank you. Thank you.