Evogene Ltd.

Ladies and gentlemen, thank you for standing by. Welcome to Evagen's third quarter 2021 results conference call. All participants are present in listen-only mode. Following management's formal presentation, instructions will be given for the question and answer session. For operator assistance during the conference, please press star zero. As a reminder, this conference is being recorded November 17, 2021. Before we begin, I would like to caution that certain statements made during this earnings conference call My evidence management will constitute forward-looking statements that relate to future events, risks and uncertainties regarding business strategy, I encourage you to review Evagen's filings with the U.S. Securities and Exchange Commission and read the note regarding forward-looking statements in today's earnings release, which states that statements made in the earnings release and, in a similar way, on the earnings conference call that are not historical facts may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1999. For example, Evagen is using forward-looking statements in this call when it discusses its expected paths to value creation, its and its subsidiaries' expected trials, studies, product advancements, pipelines, milestones, marketing activities, commercializations, launches, and entry into new markets, potential collaborations, regulatory approvals, and other plans for 2021-2022, the potential advantages of its technology, the benefits of its products, and its cash use. All forward-looking statements made herein speak only as of the date of the announcement of results. Many of the factors that impact whether forward-looking statements will come true are beyond the control of Evagen and may cause actual results to differ materially from anticipated results. Evagen is under no obligation to update publicly or alter our forward-looking statements whether as a result of new information, future events, or otherwise, except as otherwise required by law. Thank you and good day everyone. We appreciate you joining us today for our third quarter 2021 conference call. Joining me today are Dr. Arnon Hayman, CEO of Canonic,

and Ms. Dorit Kriner, our CFO. I will begin the call with discussing the recent advancement achieved in our subsidiaries and then move on to update on our plans for unlocking their value. Anon will then go on to update on the advancement in Canonics. Dorit will summarize Evogen's financial results for the third quarter of 2021. We will then open the call for your questions. So, as I mentioned, let's begin with our subsidiaries' progress in the last quarter. This past quarter, we had a few significant achievements we are very proud of, which indicate the progress we are seeing across the board in our different subsidiaries, which all rely on Evogen's technology as their competitive advantage. Starting with Biomica, our subsidiary, focused on the development of drugs based on the human microbiome. Biomica utilized Evogen's MicroBoost AI tech engine to achieve this mission. Biomica recently signed an agreement with Rambam Health Care Campus for clinical trial for its microbiobet immune oncology drug. Just to quickly remind, treatment with Biomica's BMC-128 in combination with immune checkpoint inhibitors, immune therapy, significantly improve anti-tumor activity in various preclinical models, stimulating the immune system and improve anti-tumor profiles. Biomeca expects to initiate its first in-human proof-of-concept clinical trial with VAMVAM later this year and is currently waiting for the approval of the Israeli Ministry of Health in order to begin. With respect to Biomica program for IBD, we expect to receive preclinical results later this year. Moving on to the second company in the field of human health, Canonix, our subsidiary focused on the development of medical cannabis products. Canonic utilized Evogen's generator AI tech engine to achieve this mission. I will only touch briefly on this company as Arnon will speak more in length shortly. After establishing its production and marketing infrastructure during the first half of the year, in September, Canonic initiated a product pre-launch campaign with a limited number of patients to receive market feedback. Following the positive feedback received, Canonic felt confident to move ahead of schedule with full commercialization of its two first products in October. I am particularly excited and proud of this accomplishment. I want to remind that Canonic was established only in 2019 and it already has a product in the market based on its internal research activity reaching its commercialization target ahead of time. Canonic has succeeded in creating brand awareness and we hope that the quality of its product and marketing efforts will support market penetration over the coming year. Additionally, Canonic is working to achieve its milestone for the precise product program and identify lines that exhibit distinct effects in model systems for reducing pain or inflammation as part of its collaboration with local hospital in Israel. I will now move to AgPlanus, our first subsidiary in the Ag industry segment. AgPlanus' mission is to develop and commercialize novel and safe crop protection products based on small molecules. AgPlanus utilized Evogen's Kempas AI tech engine to achieve this mission. I would like to use this opportunity and address some of the executive changes we recently announced. I would like to thank our existing ActPlanus CEO, Mr. Doug Eisner, for his service and contribution to the company and welcome ActPlanus new CEO, Dr. Brian Ember. Brian is coming in with relevant background and experience. You could even say he grew up in the alchemical industry. He is excited to lead the company to commercial success and to capture the value of Agplanus R&D achievements. I would like to wish him a lot of luck and we expect great things for Agplanus in his leadership. Moving to Labibio, our second subsidiary in the ag industry, aiming to improve agriculture productivity and sustainability through microbiome-based ag biological products. Labibio utilizes Avogen's MicroBoost AI tech engine to achieve this mission. We recently made an exciting announcement, the initial commercial launch of LaviBio first product. This product, which was previously identified as LAV211, is now branded and being commercialized under the brand name Result. Result is an inculant being introduced for spring wheat following achieving yield improvement in four-year field trials, including commercial validation in broad acre fields in target territories. In field trial, it was demonstrated that result has the potential to contribute an additional three to four bushels per acre and showed increased yield improvement compared with industry benchmarks. The first phase of marketing and initial market penetration is planned for the upcoming 2022 spring wheat season. It will be limited to target region in North Dakota and will be accomplished under a non-exclusive distribution agreement with United Agronomy. Looking forward, following this initial commercial introduction, La Vie Bio intend to evaluate the opportunity for result through additional marketing channels in additional territories for spring wheat and for applications to additional cereals. In parallel, I would like to remind that LaviBio has additional products under development. The most advanced of these products is LAV311 and LAV312, a biofungicide targeting bench root. Initially targeted for grapes, we expect to finalize the analysis of our 2021 vineyard trials by the end of this year. As reported, we also had some executive changes in Labib Bayo. Mr. Ido Dor, the CEO of the company, decided to leave. I want to thank Ido, who has been an integral part of the Avogen group over the past 10 years and has had a very big hand in many of the activities and success over the years. After a long time with the group, Ido is moving on and we wish him a lot of luck in his future path. We are currently working on finding a replacement and intend to fill this position with a CEO that will support the stage the company is currently in and will be able to lead the company in its potential future stages. In the meantime, I will be taking a more active part in leading the company, together with Mr. Dotan Borenstein, who recently joined the company as chief business officer. Finally, I would like to address our announcement from a few days ago. We received a notice from the Israeli Innovation Authority that it has decided to fund second 18-month period of the CRISPR-IL consortium which was established last year. Evogen is a key member in the consortium. with Dr. Ayali Manuel, Evogen's VP New Direction, serving as the consortium's chairperson. I will remind that the consortium's mission is to develop and validate an end-to-end artificial intelligence system, GoGenome, for genome editing in multi-species for applications in pharma, agriculture, and aquaculture. Beyond activities within the consortium scope, companies participating in the consortium may use GoGenome for their own product-oriented genome editing activities. In this respect, Evogen is currently conducting various proof-of-concept experiments in plant tissue, examining the feasibility of increasing the production of ingredients such as natural colors, and anti-aging agents for food or cosmetic products. So, like I mentioned, a lot is advancing across the board and we are very pleased. With this rapid progress, we now see significant inherent value developing within each of our subsidiaries and believe that valued separately, those companies would result in a far greater combined market value As we discussed in the past, one of the options we see to unlock the value of our subsidiaries that we believe would benefit our shareholders is the possibility of turning one or more of our subsidiaries into public companies that will trade independently from Evogen. This should allow a greater number of investors to invest directly in the area they are interested in and assign independent valuation for each subsidiary. With this respect, we are undertaking the required preparations in our subsidiaries to support this process, and we are currently reviewing our options regarding investment banks to achieve this target. Of course, the decision if, when, and how to spin out a subsidiary will depend on many considerations, including market conditions, the subsidiary financial needs, pipeline maturity, valuation, applicable regulations, etc. With that, I would now like to turn the call over to Dr. Arnon Hayman, the CEO of Canonic. Arnon?

Thank you, Ofer. I am very happy to have the opportunity to address Evogen's investor base. Obviously, the most significant thing to report about was the commercial launch of our product G-200 and G-150 in October in Israel. Both G-200 and G-150 are part of the Genovation product line under a canonic MetaYield product program. G-200 products are targeted at patients that use percentage of THC higher than 20% and G-150 For patients that want a percentage below 20% THC, more around 18%. I want to remind you that we decided to move ahead with the commercialization of these products after initiating a pre-commercial launch with a limited number of patients. In this pre-commercial launch, we received positive feedback from these patients regarding the characteristics of these products and their qualities. Specifically, these products have very appealing in fluorescence appearance, size, density and aroma and they provide a good consumer experience according to what was reported. All these supported our decision to move ahead with the full commercial launch which was initially planned for 2022. So, we began marketing and sales in the middle of October and we have been receiving very good market feedback. Looking at the orders we have been seeing from pharmacies, we are very encouraged. Obviously, this represents only the very beginning of market penetration, but it is in the right direction. Canonic is working to create brand awareness through digital campaigns in cannabis publications which specifically cater to cannabis patients. I should mention that in Israel, it is against the law to market cannabis. Unless it is in media that is specifically geared to the cannabis market. We are communicating directly with the Israeli patient community, hoping to create a loyal patient base. We will be able to see if we have recurring orders only in the next month or two. Anticipating that all goes well, we are currently broadening our cultivation and production capabilities. which are based on third-party contracts in order to ensure adequate production capacity for the demand in Israel in 2022. In parallel, we are also in contact with a number of entities in Europe in order to build our go-to market there as well. The European market is growing fast and Germany consists almost 50% of the market. As previously reported, we are aiming to start launching our products in Europe during 2023. In our R&D pipeline, we are in continued development of additional products in the MetaYield and the Precise program. In the MetaYield program, we are developing additional products with a higher concentration of active ingredients and improving additional consumer traits based on the feedback we are receiving on our current products in the market. In the PRECISE program, we are completing preclinical experiments in model systems in leading hospitals and research centers here in Israel in order to identify the first varieties to enter clinical trials. In parallel, we are in discussion with physicians in preparation for clinical trials. I would also like to mention that our R&D program is unique in that it benefits from a large database of over 1,000 cannabis lines. Combining this database with Epogen's generator AI allows us to identify unique genetic markers so that the more information we gather, the faster we are able to improve our varieties and expedite our development. So, if to summarize, these days are very exciting for Canonic. We are happy with the initial market reception of our products and we are looking forward to creating more brand awareness. In parallel, we are entering additional agreements to allow increased production capacity and are continuing to develop more products and build our go-to-market outside of Israel. With that, I would now like to turn the call over to Dorit Craner, Evogen's CFO. Dorit?