Codexis, Inc.

Greetings and welcome to the Codex's first quarter 2025 earnings conference call and webcast. At this time, all participants are in listen-only mode. If anyone should require operator assistance, please press star zero on your telephone keypad. A question and answer session will follow the formal presentation. You may be placed into question queue at any time by pressing star one on your telephone keypad. And in the interest of time, we ask you please limit yourselves to one question. As a reminder, This conference is being recorded. It's now my pleasure to turn the call over to your host, Carrie McKim, Director of Investor Relations. Carrie, please go ahead.

Thank you, Operator. With me today are Dr. Stephen Dilley, Codexys Chairman and Chief Executive Officer, Georgia Herbez, Chief Financial Officer, and Dr. Stefan Lutz, Senior Vice President of Research. During this call, management will be making a number of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including our guidance for 2025 revenue, anticipated milestones, including product launches, pilot scale manufacturing, and paths to scale-up, technical milestones, and public announcements related thereto, as well as our strategies and prospects for revenue growth, paths to profitability, and successful execution of current and future programs and partnerships. To the extent that statements contained in this call are not descriptions of historical facts regarding Codexys, they are forward-looking statements reflecting the beliefs and expectations of management as of the statement date, May 14, 2025. You should not place undue reliance on these forward-looking statements because they involve known and unknown risks, uncertainties, and other factors that are, in some cases, beyond Codexys control and that could materially affect actual results. Additional information about factors that can materially affect actual results can be found in Codexys' filings with the Securities and Exchange Commission. Codexys expressly disclaims any intent or obligation to update these forward-looking statements, except as required by law. And now, I'll turn the call over to Stephen.

Thank you, Carrie, and thanks, everyone, for joining. Before we begin our comments today, you'll notice that Chief Operating Officer Kevin Norritt isn't on this call. That's because he's busy at an on-site visit with an important Codexes customer, but he will be available for follow-up questions later this week, and will also present during our TidesUSA Investor Recap call next Thursday. Starting on slide two, we've delivered a first quarter largely in line with our expectations, crucially, we've preserved a strong financial position, maintaining our runway to cash flow positivity by the end of 2026. The Q1 revenue guidance we outlined in February included a $2.5 million one-time payment from a pharma biocatalysis customer, which then shifted into April. Had we received payment on the timeline originally communicated by our customer, we would have come in at the top of our Q1 range. That said, we've since received the order and we're confident in reiterating our 2025 guidance and the current range of published analyst estimates. That confidence is underscored by the meaningful progress we've made across both core businesses so far in 2025, which sets us up for a substantial revenue ramp in the second half of the year. On slide three, in pharma biocatalysis, our product mix is changing. and we're driving margin improvement. We also have a nice bench of new customers, particularly within the mid-tier pharma segment. While drugs in phase one and two clinical trials aren't significant revenue generators today, we're positioning this business for a steady growth trajectory as some of those assets enter later stage trials and commercialization in the years to come. Already this year, we've also executed on several key commercial milestones with our Ecosynthesis platform. In March, we signed our first revenue-generating eco-contract representing the inaugural project to enter our innovation map. Furthermore, our double-stranded RNA ligase business is growing. We delivered our first order to a large pharma customer in Q1 with additional orders expected. and we've secured an initial ligase order from a second drug innovator. We're also very much looking forward to the TIDES meeting in San Diego next week. There will be at least six presentations showcasing the ECO platform, including three by Codexis and three by our collaborators. The presentations will cover a wide range of topics, including the intrinsic scalability and sustainability of the core ECO process, and our emerging capability to fully control chirality, which can influence the biological activity, specificity, and potency of each molecule. We'll also be presenting on our groundbreaking machine learning capabilities for improved ligase selection and fragment design. Possibly the most validating event will be presentations from three of our CDMO collaborators describing the superior performance of our ligases in their hands. Stefan will share more on each of those presentations shortly, and we plan to host a tight recap call for investors to dive into detail following the meeting. Moving to slide four. Many companies are finding the current macro environment to be a challenge. However, it's become increasingly clear that several of these external factors could play in our favor and actually create a positive environment for our eco-synthesis platform. Let me tell you how. First, the siRNA field is evolving exactly as we'd hoped and planned for. In March alone, there was a label expansion of Alnylam's drug butrizeran to address ATTR amyloidosis with cardiomyopathy. and Sanofi and Alnylam's Fetuceran became the seventh siRNA therapeutic to gain FDA approval. Eli Lilly also shared promising Phase II data on Mepidizoran, showing that the asset significantly reduced levels of a genetically inherited cardiovascular risk factor that impacts nearly a quarter of the world's population. This momentum clearly points to the coming demand for these RNA-based therapeutics, particularly given the potential impact across both rare orphan and widespread disease indications. You've also probably seen recent pressure on companies to onshore their production. That's good news for Cadexis. Not only can our eco-synthesis technology offer the scalability and flexibility that customers need, but it also enables onshoring with greatly reduced capital expenditure and could be built out on an expedited timeline. Taking things one step further, we've previously shared that we're working to develop an enzymatic supply of raw materials for our ecoprocess. This would help customers diversify their source of input materials, and it would reduce their dependence on uncertain foreign supply chains, particularly China. The big picture is coming together nicely for our eco-synthesis platform. Shifting to slide five, let me recap the commercial landscape for eco. Here you can see our three core customer segments, small siRNA drug innovators, large siRNA drug innovators, and oligo CDMOs. While we have momentum across all three categories, particularly with our ligase offering, we're currently gaining the most traction with CDMOs. That's because small drug innovators are interested in our technology but tend to be cash strapped, especially today. Larger drug innovators are the opposite. They're interested but are largely focused on addressing a demand problem that's two to three years away, meaning they can watch where the industry goes before making any decisions. CDMOs, on the other hand, are an ideal first mover for ecosynthesis. They know exactly how long it takes to ramp up capacity, and they want to build out infrastructure today so they're ready when customers come looking for sRNA manufacturing slots. They also generally have an existing network of customers that we can tap into to build new relationships. In fact, we've already been in situations where a CDMO collaborator has introduced us to their drug innovator clients who are looking for innovative siRNA manufacturing solutions. Importantly, that dynamic benefits both Codexys and the CDMO, as we'll funnel our drug innovator customers to the CDMO as part of the commercial scale-up process. The beauty of this model is it sets us up for a consistent flow of customers, and we can provide them with a clear route to GMP-grade material in the near term. It also gives us time to thoughtfully determine the best path forward for a potential CADEXIS GMP manufacturing facility. As we've said in the past, executing on a market penetration strategy takes time. Fortunately, We know that from here on out, driving adoption of ecosynthesis is a matter of execution, not invention. We've already shown that we have the tools and the technical know-how. Now it's about taking a few finite steps to demonstrate to customers that we can develop a reproducible, scalable process for their assets. As it happens, that's what our Tides USA presentations next week are all about. So let me pass it over to Stefan for a preview of what's to come.