Dyadic International, Inc.

Good evening, and welcome to the Dyadic International's 2021 Year-End Financial Results Conference Call. Currently, all participants are in listen-only mode. Following management's prepared remarks, there will be a brief question-and-answer session. As a reminder, this conference call is being recorded today, March 29, 2022. I'd now like to turn the conference over to Ms. Ping Rawson, Dyadic's Chief Financial Officer. Please go ahead.

Thank you. Good evening and welcome everyone to Dyadic International's 2021 year-end conference call. I hope you've had the opportunity to review Dyadic's press release announcing the financial results for the year-ended December 31, 2021 and the recent company highlights. You may access our press release on Form 10-K and the Investors section of the company's website at dyadic.com. On today's call, our president and CEO, Mark Imelbarb, will give a review of our year-end 2021 business and recent corporate highlights, including a brief summary of our research and business development efforts. I will follow with a review of our financial results in more detail. We'll then hold a brief Q&A session. Our senior management team, Joe Hazleton, Matthew Jones, and Ronan Shillette will join Mark and I for the Q&A. At this time, I'd like to inform you that certain commentary made in this conference call may be considered forward-looking statements, which involve risks and uncertainties and other factors that could cause dyadic's actual results, performance, scientific or otherwise, or achievements to be materially different from those expressed or implied by these forward-looking statements. Diatics expressly disclaims any duty to provide updates to its forward-looking statements, whether as a result of new information, future events, or otherwise. Participants are directed to the risk factors set forth in Diatics reports filed with the SEC. It is now my pleasure to pass the call to our CEO, Mark Imhoffar. Mark?

Thank you, Ping. Good evening and thank you for joining us today. Before we begin, I just wanted to share the team's optimism for what is in store for Dyadic in the year ahead and just how proud we are of Dyadic's scientific and business accomplishments in 2021. While we're still early in the days of seeing what the full potential of synthetic biology holds in the world, we are excited to be part of this future. as we look forward to leveraging our proprietary and patented C1 protein production platform and our other technologies to become one of the leading platforms for synthetic biology production. The synthetic biology market is categorized into the following segments, medical applications, industrial applications, food and agriculture, and environmental applications. In 2020, the medical application segments accounted for the largest share of the synthetic biology market, which remains our primary focus for C1's commercial goals at the protein manufacturing platform. To this end, we are proud to share not only the year's progress with you, but also our 2022 development goals on this first investor update call of the new calendar year. As you know, we have made it clear that it is the company's mission to improve the way we feed, fuel, and heal the world. This year sets new operating milestones for us to hit, while staying true to that mission. What I hope you take away from today's call is renewed focus to our mission and the ability to take it to the next level. We expanded and enhanced our leadership team with the appointment of Joe Hazleton as Chief Business Officer, whose role supports the global commercialization of the company's new and existing business initiatives. including corporate strategy, business and corporate development and licensing. We have put ourselves in a better position to tackle the influx of global partnering requests and interests related to the company's experience and knowledge, coupled with the advancement of our SLEEP C1 platform and other technologies. Additionally, after several years of internal research and development, published preclinical proof-of-concept papers across the industries we are targeting today. We believe we are entering a new period of potential growth, highlighted by advanced testing and development of our C1 protein production platform and our other technologies in the industries that we are using to penetrate some of the largest commercial enterprises in these industries, be it human or animal health, food manufacturing, or industrial endeavors. As we focus our commercialization and development efforts on these core verticals of human health, animal health, and other biomolecules, examples of major accomplishments in advancing the commercial viability of our C1 protein production platform and other technologies have included partnerships with Fibro Animal Health, Janssen, and a multitude of organizations around the world that have been instrumental in fully funding a number of our non-COVID-19 biopharmaceutical programs, as well as helping us to advance our proprietary DY-100 COVID-19 vaccine candidate. We are pleased to note that manuscripts relating to antigens produced from C1 cells showing safety and efficacy in animal models against influenza and SARS-CoV-2 were published in three peer-reviewed scientific journals, including vaccines. We have successfully completed the toxicology study of our DY100 COVID-19 vaccine candidate. a manuscript showing safety and persistence has been peer-reviewed and is awaiting publication in the scientific journal Toxicologic Pathology. These are exciting preclinical studies for us that, among other benefits, demonstrate the safety, efficacy, and the number of other biochemical structures and properties of the SARS-CoV-2 RBD antigen produced from C1 cells. In addition, These publications also demonstrated a novel method to deliver the C1 SARS-CoV-2 RBTE antigen subcutaneously and intranasally, and separately, the utility of the C1 cell protein platform in expediting production of seasonal and pandemic influenza vaccines. We have refocused and improved our active outbound awareness regarding the steady advancement our knowledge for the ubiquitous uses of C1 across 20-plus years of proven industrial manufacturing, which we have begun to leverage as we continue to pivot into biopharmaceutical manufacturing of vaccines, antibodies, and other therapeutic proteins. We firmly believe that these efforts have the potential to revolutionize medicinal biomanufacturing. We've already begun to conduct funded research in areas of agriculture, food production, and metabolic engineering. We remain focused on the application of our C1 protein production platform to address health inequity in middle and lower income countries who are reliant on outside sources of vaccine and drug production or which lack the infrastructure and resources to store and distribute vaccines which require advanced cold storage techniques. While we continue to move our DY100 COVID-19 vaccine candidate into the clinic, we want to emphasize that interest in the C1 platform is happening across numerous other applications in addition to vaccines and therapeutics. And we believe that we will continue to deliver in this arena for years, not only in the US, but through our collaboration relationships in Africa, India, Asia, Europe, and the Americas. As we move these efforts forward, I want to reiterate The dyadic through these partnerships continues to maintain our own IP as we structured our partnerships to include upfront payments, development milestones, and future commercial-based royalty or other forms of earnouts. With this said, let's move ahead in the call to quickly cover some of our recent company highlights, which we have announced in recent press releases. A major win was the announcement of Dyadic's agreement with Janssen Biotech, facilitated by J&J Innovation. We already received Janssen's upfront payment of $500,000 for their non-exclusive rights to utilize the C1 cell protein production platform to develop C1 production cell lines for the manufacturing of Janssen therapeutic protein candidates against several biologic targets. As awareness continues to expand around C1's ability to revolutionize commercial protein expression, we believe we'll continue to see similar agreements to come as we ramp up our team's efforts in new business development, which we expect would in turn trigger future upfront payments, milestones, royalties, or other forms of payments. Additionally, for this particular agreement with Janssen, we will be provided R&D funding for up to 1.6 million euros to develop and assess C1 production cell lines for its product candidates. We recently announced a broadening of our relationship with Fibro Animal Health, a leading global diversified animal health and mineral nutrition company. We've entered into an exclusive license agreement to produce a single specific targeted antigen for development and commercialization of a poultry vaccine. The agreement follows a successful proof of concept development work, including animal trials previously completed by the two companies. The parties expect to continue working on developing additional animal vaccine candidates to be produced from dyadic C1 cells. In December, we announced that we received a National Institute of Manufacturing of Biologics, NIMBL, coronavirus grant under the White House American Rescue Plan of up to $690,000 in order to engineer two C1-derived antibodies. The NIMBL project is off to a good start. This grant is intended to benchmark the speed that C1 manufacturing platform and the advantage we will have compared to current state-of-the-art methods, which could lead to a rapid ability to produce medical countermeasures and vaccines in response to future pandemics. Earlier this month, the company announced that due to a disagreement between the parties concerned in the timing in terms and conditions of the previously announced term sheet with Sorrento Therapeutics for the entry in the license agreement that the parties have mutually agreed to terminate the term sheet effective March 17, 2022. We also sent Louina Bio a termination notice letter related to our license agreement with Louina Bio Novavet in February 22, as they not have been able to raise capital to continue the program. As our partners' needs and business focus has changed over time, we view these terminations as an ongoing part of our business. However, both Janssen and Fibro are great examples of how our years of hard work in the research and development of C1, as well as renewed business development efforts on multiple fronts, are bearing fruit. For those who have followed the company over the last several years, all indications have marked a certain maturity in our development life cycle. as we move towards the company's technology from proof of concept to partnering and collaboration towards commercialization and feasibility studies to first in human trials. Moving on to certain of DIATIC's ongoing global collaborations. We entered into a technology transfer and license agreement with South Africa's Rubic Consortium, who have already begun working to develop end-to-end solutions for vaccine discovery, development and manufacturing for the African market. This arrangement includes C1 COVID-19 vaccine technology transfer and licensing agreement, a potential funding pathway for a C1-manufactured COVID-19 vaccine to progress to Phase II and III clinical trials. Establish a co-development basis for research, developing, and manufacturing multiple other products, vaccines, in addition to DY-100. An intention to reduce African independence on foreign vaccine suppliers. In coordination with CR2O, Paracel, and Rubic, we are preparing for submission of a clinical trial application, CTA, of our DYA-100 vaccine candidate to the South African Health Products Regulatory Authority, or SAFRA. We have identified WITS clinical research, a division of the WITS Health Consortium, BTY Limited, as a potential site for carrying out the DYA-100 phase one clinical trial to validate C1-produced proteins are safe in humans, and further accelerate the global C1 platform adoption. This clinical trial will also serve as a proof of concept for other next-generation variant COVID-19 vaccine candidates. It's important to note that WITS has experience carrying out COVID-19 vaccine clinical trials in South Africa for big pharma. While many on the call may be familiar with the FDA's clinical testing phases and drug approval process, We wanted to take some time to discuss the process for South Africa it's important to note the importance of partnering with the consortium in South Africa rubric in which. Not only from a regulatory partnering perspective, but also from a trial design perspective, especially amidst. the evolving landscape of COVID-19, including the disease, infection, and transmission rates. The shift now has been away from treating COVID-19 as pandemic, but rather controlling and managing infection and transmission rates, as well as symptom severity in the absence of the ability to control how COVID-19 variants evolve. This is the primary reason why global regulatory guidelines around COVID-19 vaccine development is still evolving. That said, our partnership with the WITS and the consortium in South Africa give us unprecedented access to leading institutions and R&D scientists who have been at the very front lines of testing and developing current COVID-19 treatments. including Pfizer's current COVID vaccine, AstraZeneca and others. That is in the marketplace in South Africa today. Current data suggests that many of the so-called first generation vaccines remain highly effective against existing several of the variants of concern. However, the Omicron variant and subvariants being potential exceptions, particularly against severe disease. However, it's possible a new variant will emerge that may overcome the current vaccine-induced protection to some degree, with the emergence of the Omicron variant only highlighting this risk. The C1 cell protein production platform can effectively support the global immunization strategies that are needed against emerging SARS-CoV-2 variants of concern. The company can rapidly insert receptor-binding domain variant genes into the same C1 cell line, same genotype in approximately 60 days. Thus far, in addition to the original Wuhan SARS-CoV-2, the following variants have been successfully produced from C1 cells, the Alpha UK, Beta South Africa, Gamma Brazil, Delta India, and already we have the Omicron B11.529. One of the commercial goals of DIATIC is to demonstrate effective capability to rapidly produce different combinations of multivalent COVID-19 vaccines, which could protect against several variants of concern at once. We continue to work with Syngene in India, a major global contract development and manufacturing organization with a headcount of over 5,000 employees. Syngene International is an integrated research development and manufacturing company providing scientific services. It conducts early-stage research, preclinical and clinical trials, drug substance and drug product manufacturing and development, biologics manufacturing, and other services. The company serves not only the pharmaceutical industry, but the biotechnology industry, nutrition, animal health, and consumer goods and special chemical industries. Our discussions with Syngene have centered on advancing a commercial framework and planning around the use of C1 cell protein production platform, and our other technologies as an in-house option to traditional CHO and other cell line manufacturing offerings for manufacturing vaccines, antibodies, and other therapeutic proteins. In 2020, the company entered into a non-exclusive technology usage agreement with Epigen Biotech of India, who plans to conduct clinical trials in India using dyadic C1 cell protein production platform to produce their COVID-19 vaccine. Epigen recently procured the approval for funding from the government of India to move forward towards vaccine production technology across early stage phase one and phase two human clinical trials. In order for Epigen to receive the government funding, it must contribute approximately 25% of the funding from other sources. During 2021, the company also expanded its influenza vaccine collaboration with the University of Oslo. Scientific results included having mice vaccinated with C1-produced AMHE2 hemagglutinin, California 7, 2009, combined with an adjuvant, ASO3, challenged with a lethal dose of 5LD50 of the homologous influenza A H1N1 showed no clinical signs, no weight loss, and the mice were fully protected. Other mice trials are ongoing as we speak, and others are scheduled, with C1-produced antigens, influenza, and SARS-CoV-2 with Oslo University. A part of inbound inquiries, we have highlighted the launch of our biomolecule development In order to demonstrate that our industrially proven C1 cells can be engineered to manufacture therapeutically viable and commercially useful cannabis compounds, including cannabidiol or CBD and its precursors using synthetic biology. As acceptance for therapeutic uses for cannabinoids continue, we are demonstrating C1's potential to manufacture pure synthetic cannabinoids for commercial use potentially cheaper and more effectively as compared to conventional methods using hemp and the marijuana plant cannabis sativa. This is just another example how we are starting to apply synthetic biology to engineer C1 cells to help improve, develop more efficient bioprocesses for a number of potential applications. And with this, I'll turn the call over to our CFO to run through our financials, Ping Razen.