Q2 2022 Dyadic International Inc Earnings Call
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Good day and welcome to the Dyadic International Incorporated second quarter 2022 financial results conference call. Today's conference is being recorded. At this time I would like to turn the conference over to Pang Rawson, the financial officer.
Good day and welcome to the Dyadic International Incorporated second quarter 2022 financial results conference call. Today's conference is being recorded. At this time I would like to turn the conference over to Pang Rawson, the financial officer. Please go ahead. Good day and welcome to the Dyadic International Incorporated fourth quarter 2022 financial
Thank you. Good evening and welcome everyone to the Dyadic International's second quarter 2022 conference call. I hope you have had the opportunity to reveal Dyadic's press release announcing financial results for the quarter ended June 30, 2022, and the recent company highlights. Thank you for your connections.
You may access our release and the Form 10Q under the investors section of the company's website at idiotic.com.
On today's call, our President and CEO , Mark Imophar will give a review of our second quarter 2022 business and corporate highlights, including a brief summary of our research and business development efforts.
Our Chief Business Officer, Joe Hazelton, will join Mark for the business update.
I will follow with a review of our financial results in more detail. We'll then hold a brief Q&A session.
At this time, I would 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 dietetics actual results, performance, scientific or otherwise.
Our achievements to be materially different from those expressed are implied by these forward-looking statements.K
static 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 the ethics reports filed with ICC.
It is now my pleasure to pass the call to our CEO Mark Imasok.
Thank you, Ping. Hello, everyone, and thank you for joining Dyadic's second quarter update call.
As you will hear on today's call, there's much to be excited about here at Dyadic.
In Q1, we discussed the company's intent to focus on our core business.
The company now has commercial agreements in each of its three core verticals.
human health, animal health, and alternative proteins.
Today I would like to discuss the progress we have made in each of these areas and how we believe that the progress will shape the future of dyadic.
At the fundamental level, Dyadic's mission is to help make protein for world health.
The foundation of dyadic is and will continue to be our science and our highly efficient microbial platforms.
and the advancement of that science to create revenue, profits, long-term share of our value, while simultaneously helping to increase access to biologic vaccines and drugs globally.
The commitment to build a protein production platform to support life science manufacturing takes an unwavering belief that a potential monetary and social impact outweighs the significant investment of not just capital, but persistence, focus, and the determination to see the process through.
To the many scientists we continue to work with in academia, industry, and government, our collaborators, shareholders, and board members, I want to thank you for your support during this critical journey.
While admittedly it has been arduous at times, as you will hear today, we are on the verge of several transformational milestones in life sciences.
as we get closer to demonstrating that producing proteins using our C1 technology are safe for use in humans.
Doing so will lead to our ability to open opportunities within our core verticals and capitalize on existing and new revenue opportunities for Dyadic and our collaborators.
First, I would like to focus on the significant milestones we have achieved in human health.
I am proud to announce the recent submission of our first in human clinical trial application CTA with the South African Health Products Regulatory Authority, SAFRA.
to initiate a Phase I study to support clinical safety.
and to demonstrate preliminary efficacy of our DYAI 100 COVID-19, recombinant protein booster vaccine.
This is an important step toward establishing C1 as a safe and transformative option as a protein production platform for the development and manufacture of a growing number of biopharmaceuticals for infectious and other diseases, including oncology, arthritis, and diabetes.
Our Chief Business Officer, Joe Hazelton, has been overseeing our efforts in regards to this submission.
I'll now turn the call over to Joe to discuss the timing and relevant aspects of the clinical trial application, CTA for dyadic.
Thank you, Mark.
The primary purpose of a Phase I study is to evaluate the safety of a new drug candidate before it proceeds to further clinical studies. When joining Diotic, what was most surprising wasn't just the amount of preclinical safety data that had already been generated across animal species regarding the C1 platform for a smaller biotech organization, but also the amount of preclinical safety data that had already been generated across animal species regarding the C1 platform for a smaller biotech organization.
But unlike E. coli, CHO, and insect or baculovirus cells, the C1 cells themselves are free of viruses and endotoxins.
Many of the most common cell lines used for biologic vaccines and drug production inherently have viruses and or endotoxins that must be removed during downstream processing, impacting productivity, cost of purification, and ultimately delaying product release.
Additionally, in 2009, dyadic C1 cells were used to produce an enzyme that received generally recognized as safe or GRAS status from the US FDA, which means safe for use as an additive in food and feed for animals and humans. Essentially, we're starting the biomanufacturing process with what we and a growing number of scientists believe is an extremely safe microorganism.
Data from vaccines produced from C1 proteins have repeatedly demonstrated safety and efficacy in a range of infectious diseases in animal trials with cattle, lambs, chicken, rabbits, hamsters, and mice, again demonstrating the preliminary safety of proteins produced from the C1 protein production system.
Specifically, with our DYAI 100 vaccine candidate, we have demonstrated safety in mice studies and our successful rabbit toxicology study performed at Envigo.
And Avigo has extensive experience in conducting GLP toxicology studies to help establish safety and dosing protocols which are required for an IND or INPD regulatory filing.
Which bring me to today's announcement of our submission of a CTA or clinical trial application with South Africa to initiate a phase one study to support clinical safety of proteins produced from our proprietary and patented C1 cell protein production platform.
In addition to establishing a track record of safety in humans for antigens produced from our C1 cells, the phase 1 study is also expected to demonstrate preliminary efficacy of our DYAI100 COVID-19 Recomident Protein Booster Vaccine candidate.
The DYAI 100 application is currently under regulatory review and pending approval, we anticipate dosing could be initiated late in third quarter.
with the potential for preliminary safety data readout in the late fourth quarter of 2022.
As you are all aware, it is challenging to accurately provide timing of clinical development. It is dependent on many variables, with the only constant being that the environment today will be different tomorrow. We will keep you informed of any business or regulatory factors that may impact these proposed timelines.
A successful outcome to the Phase 1 trial for DYAI 100 would not only bring another weapon closer to approval in the battle against COVID-19, but also provide safety validation for ourselves and our collaborators, reducing their developmental risk for new vaccines.
Safety is the first hurdle to commercialization for any new life science product, whether COVID-19, oncology, or rheumatoid arthritis.
That same safety challenge exists for platform technologies.
but with the additional hurdles of speed and productivity.
As we have stated previously, Dyadic has dedicated the time, effort, and resources to demonstrate that the C1 protein expression platform is capable of unparalleled scale and productivity in terms of vaccine production, and our platform has been well characterized, and that the C1 organism has a pedigree that we believe will demonstrate its safe use in humans for producing greater quantities of lower cost vaccines.
We expect that the Phase I clinical trial in South Africa and later Phase I trial in India with Epigen, which Mark will speak about later, will be a pivotal point in the many ongoing discussions we are having with top tier pharma, biotech, and government agencies globally.
Staying with our ongoing successful efforts in vaccine business development, I'd like to highlight our efforts regarding expressing the neuraminidase antigen, or NA, which has broad potential use in the development of better seasonal and pandemic flu vaccines.
The NA antigen has historically been difficult to produce reliably at high levels and with the right biological activities.
The addition of NA to standard flu vaccines can enhance the immune response to provide even greater protection to patients.
Our current level of expression of 800 milligrams per liter in 168 hours has generated interest with large pharmaceutical and biotech companies within the human vaccine industry.
The successful high-level expression of biologically active hemagglutinin, or HA, and neuraminidase NA from C1 cells for use in developing better performing influenza vaccines alone or in combination with COVID-19 antigens is only one example of the many opportunities we believe will accelerate the adoption of the C1 platform in addition to the first in human safety data for a C1-produced protein.
from the upcoming DYA100 Phase 1 trial. I would like now to turn back to Mark for further updates on our progress in life sciences. Mark?
Thank you, Joe.
Each project we undertake is selected with a specific objective to either further the advancement of our science or enhance the breadth and scope of where we and our collaborators may be able to apply to C1 platform.
The output of these projects and collaborations validates the application of C1 as a differentiated biomanufacturing platform for developing and producing vaccines, antibodies, and other therapeutic proteins more rapidly at higher yields and lower cost for the prevention and treatment of infectious and other diseases such as oncology, arthritis, and diabetes.
For example, we are in discussions with potential partners for a rabies vaccine candidate, highlighted in today's press release, that is a collaboration with EU scientists to prevent rabies infection in humans after an exposure.
This opportunity is similar to neuraminidase Joe highlighted earlier, as the NA opportunity was born from a collaboration with an academic institution.
In addition to DYA100, we believe neuraminidase and HA, both in influenza antigens, will anchor and further support our business development opportunities in infectious disease.
And we have additional animal trials ongoing with C1-produced antigens for potentially more effective seasonal influenza vaccine.
Additionally, in conjunction with others, we are evaluating if and how we may use C1 to develop and manufacture a COVID-19 seasonal and or pandemic vaccine candidate.
Expanding our vaccine licensing, as really reported, Epigen, one of Dyadic's non-exclusive licensees, received funding from the Indian government to advance development, manufacture, and conduct Phase 1-2 clinical trials using Dyadic's C1 protein production platform for their COVID-19 vaccine candidate produced from C1 cells.
To update our efforts in adoption of the C1 vaccine platform in South Africa, our collaboration with the Rubik Consortium is intended to develop end-to-end solutions for vaccine discovery, development, and manufacture to the African market.
Tech transfer of the C1 protein production platform is advancing on target and has been substantially completed. My rubric have been engineering and growing C1 cells.
Our discussions with Rubic and South Africa, as recently as this morning, are targeting a growing number of antigens for human and animal health that they believe are commercially relevant to the African continent.
Now I'd like to focus you for a moment on an area that is another key life science growth market for dyadic.
Therapeutic proteins.
Global therapeutic proteins are a $280 billion market that is expanding at a compound annual growth rate of around 7%.
This has increased as demand has surged for protein-based therapeutic drugs to treat COVID-19 and other infectious diseases and other ailments.
And that demand has spread to other disease areas in human and animal health.
Joe just took us through the various preclinical animal models tested and a brief analysis of what we expect shortly allow us to demonstrate to big pharma, biotech companies in government, and academia globally the safety profile for recombinant antigens produced using our C1 platform for the commercial production of recombinant vaccines.
To further support our science regarding therapeutic proteins, we announced today that the dosing has completed for a fully funded non-human primate study of a C1 produced COVID-19 monoclonal antibody.
What data readout anticipated later this year?
This monoclonal antibody has already demonstrated broad neutralization and protection against omicron BA1 and BA2 and other variants of concerns in hamsters.
The importance of this data is that we'll be able to begin to demonstrate safety and efficacy of a C1-produced therapeutic protein in a non-human primate study.
through this fully funded initiative with one of our third-party collaborators.
Furthermore, this non-humid primate study is anticipated to lead to a funded GLP toxicology CGMP manufacturing of drug substance and potentially a phase 1 clinical trial.
this time demonstrating safety for a therapeutic protein manufactured from a C1 cell for the first time in humans.
Establishing safety and efficacy through these phase 1 trials for vaccines and monoclonal antibodies is a key gating item for big pharma, biotech, and government agencies such as BARDA. And we expect this to accelerate the use of our C1 platform to produce safe and effective vaccines and therapeutic proteins and therefore anticipate that dyadic and RC1 technology for use in speeding development.
and lowering the cost of manufacturing biologics will lead to several licenses, or potentially an acquisition target in the infectious disease and other disease biologics markets.
We recently made presentations at BIO, NIMBL, and other industry conferences as well as a growing number of inbound requests for information related to the advancement of our work on the Vellumam and other biologics.
As we are focusing our attention on the quality aspects related to the development of biosimilars and biobetters, we continue to push the advancement of productivity to new levels.
Several of the recent scientific achievements in our C1 technology are nothing short of amazing.
And we are applying these advances to support the development of the C1 platform for our own projects as well as those in collaboration programs such as the work we are doing with distinguish and an analytical partnership.
While we still have work to do, the interests we are generating and the knowledge gained are rapidly expanding interests not only in the Villemab, but also across many areas in which our C1 platform can be applied for rapid production for large quantities of antibodies, vaccines, across large and mid-sized pharmaceutical companies, and human and animal health.
Our collaboration with Janssen Biotech to develop C1 cell lines to produce targeted therapeutic protein candidates demonstrates our ability to attract the attention of large pharmaceutical partners.
Progress is ongoing and on time, and we anticipate this will lead to development milestones and eventually commercial revenues generating from one or more of the Janssen target proteins.
I also want to highlight that our work under the grant awarded to Dyadic by Nimble, funded through the White House's American Rescue Plan has been successful.
We have already begun the second phase where we're applying some of the advanced scientific breakthroughs I discussed earlier.
Under this grant, Dyadic has already started to receive the $690,000 in funding to engineer a C1 protein production platform to produce two different antibodies with a focus on evaluating the ability of the C1 platform to rapidly produce medical countermeasures and vaccines in response to future pandemics.
Now I would like to turn our focus to animal health and the expanding opportunity for business development to exist within this core vertical.
You may have noted in today's press release that Fribro, ABEC, recently expanded their license agreement to include an additional research project to develop another animal vaccine for livestock produced from C1.
Global animal health vaccine market is an estimated $15 billion market, and we are just beginning to penetrate this segment.
There are similarities and needs between the human and animal health markets for vaccines and therapeutic proteins. I have asked Joe to expand our efforts to identify opportunities within this core vertical for monetization.
I will ask Joe to provide his thoughts on the market penetration.
Thank you, Mark.
As you noted, the animal health vaccine market is an attractive segment for dyadic. Like human health, the demand is increasing for the rapid production of large quantities of vaccines and antibodies to address the feed and companion animal markets alike.
The global animal health market overall was nearly a 50 billion market in 2021. The rise in demand for animal food protein and therefore livestock, rising pet ownership, and increases in zoonotic diseases are driving increased interest in vaccines and therapeutics for animals as well as humans.
As I discussed earlier, we have demonstrated the safety and efficacy of our vaccines in many animal models. For example, we have successfully tested a vaccine to protect livestock from zoonotic diseases such as Rift Valley Fever.
Initially, we're exploring opportunities within animal vaccines for zoonotic diseases we have already expressed and tested within the C1 platform for fully funded collaborations targeting companion animals which is the next fastest growing animal vaccine market.
We are also currently in discussions with several potential partners for therapeutic proteins for livestock and companion animals. Our focus is to speed the acceptance of our C1 protein production platform, which we believe can serve as an accelerator to drug and vaccine development and commercialization by shortening the time from preclinical to phased trials, increasing productivity, and improving cost efficiencies within animal health. Back to you, Mark. Thank you.
Finally, I would like to speak about our alternative proteins.
This core vertical is home to our nutrition and wellness initiatives and partnerships.
driven by our fully funded joint development agreement with our Global Food Ingredients Collaborator.
Dyadic is dedicating resources and support for existing projects within this rapidly growing market.
Today, we announce the launch of the Daphogas platform, which is a fungal-based microbial platform for use in non-pharmaceutical applications such as food, nutrition, health, and wellness.
Joe will describe our strategy for maximizing the potential for his core vertical.
for maximizing the potential for this core vertical. Thank you, Mark.
As was stated in our press release, our recently developed Dapabus microbial cell line is gaining interest across multiple applications and industries for the development and manufacture of alternative proteins.
As an example, we're currently in discussions with several companies in the cultured meat and seafood industry.
These companies represent end product, bio-design, and cell culture media, and share a commonality, the need for a large quantity of high quality, yet affordable recombinant proteins.
This is a $3 billion market that is still in the demonstration scale, with a significant cost and production bottlenecks that the entire industry is trying to solve and saw over $1.3 billion invested in 2021 alone.
This will be a key area of focus for our dyadic, as we believe our Dapabus microbial cell line provides our partners the ability to meet scale and cost demands for recombinant proteins within the global cultured meat industry.
Beyond cultured meat, we are in active discussions and actively seeking partnerships and collaborations for non-animal food proteins, nutraceuticals, and metabolites.
As I turn it back to Mark to close out our business update, hopefully Mark and I have been able to share with you today is that through the dramatic and continuing advances
in our science and to focus on clear business objectives, the monetizable opportunities are multiplying and coming to the forefront where we can apply our microbial technologies to address several emerging and growing market opportunities to drive value for shareholders. Marc, back to you.
The development of a protein expression platform for use in life sciences is a lengthy and challenging process. The development of a protein expression platform for use in life sciences is a lengthy and
What I'm most proud of is that we have leveraged the learnings of C1 and commercial scale industrial manufacturing to accelerate that development process.
In parallel, we remain fiscally responsible, and R&D partnerships and collaborations define advancement of our science in critical areas.
The result is that CMOS is much further along in its life cycle development for life sciences than the industrial chill cell line development was within the same timeframe at a fraction of the cost with equally high prospects for success.
We've refined our business development focus and objectives with the core areas where our employees can have the greatest impact.
The results of this focus is being realized as Dyadic is gaining industry recognition to further develop the platform for human and animal health organizations worldwide.
At the same time, we are evaluating new opportunities aligned with our verticals in targeted markets of high potential return.
With that, I'd like to turn the call over to our CFO to run our financials.
Thank you, Mark.
In addition to the financial results I'll be discussing now, you can find additional information in our Form 10Q, which we filed earlier today.
Research and development revenue and the license revenue for the second quarter of 2022 was approximately 659,000 compared to 937,000 for the same period a year ago.
R&D revenue and the licensed revenue for the six months ended June 30, 2022, with approximately $1,306,000 compared to $1,397,000 for the same period a year ago.
Cost of R&D revenue for the second quarter was approximately $411,000 compared to $830,000 for the same period a year ago.
The cost of R&D revenue for the six months ended June 30, 2022, was approximately $816,000 compared to $1,220,000 for the same period a year ago. The decrease in revenue and the cost of revenue was due to the decrease in the number of ongoing research collaborations as a result of our strategic refocus of the company's core business. For more information, visit www.R
R&D expenses for the second quarter decreased to approximately $1,831,000 comparing to $2,209,000 for the same period a year ago.
R&D expenses for the six months ended June 30, 2022, decreased to approximately $3,174,000 compared to $4,017,000 for the same period a year ago.
The decrease in R&D expenses primarily due to the winding down of activities of contract research organizations and pharmaceutical quality and the regulatory consultants to manage and support the preclinical and clinical development, as well as a decrease in CGMP manufacturing costs as the company moves toward its anticipated Phase I clinical trial of our DYA 100 COVID-19 vaccine candidates.
GMA expenses for the second quarter decreased to approximately $1,714,000 compared to $1,748,000 over the same period a year ago.
CNA expenses for six months ended June 30, 2022, increased to approximately $3,370,000 compared to $3,302,000 for the same period a year ago.
Net loss for the second quarter was approximately $3,288,000 or 12 cents per share, compared to $3,846,000 or 14 cents per share for the same period a year ago.
Net loss for the six months ended June 30, 2022, was approximately $5,780,000 or 20 cents per share compared to $7,141,000 or 26 cents per share for the same period a year ago. Our cash, cash equivalents, and the carrying value of investment-grade securities as of June 30, 2022, including accrued interest, were approximately $6,700,000 or $6,700,000 or $8,700,000 or $9,500,000. Our cash, cash equivalents, and the carrying value of the two months ended June 30, 2022, was approximately $7,740,000 or 26 cents per share. Our cash, cash equivalents, and the carrying value of the two months ended June 30, 2022, with a total of $6,700,000 or $9,500,000 or $9,500,000.
$15.7 million compared to $20.4 million as of December 31, 2021.
Based on our current plans, the company expects that its existing cash, cash equivalents, and investment grade securities will be sufficient to fund Phase I clinical trials of DYI 100 and its operating expenses into 2024.
With that, I will now ask the operator to begin our Q&A session.
Senior management team will join Mark and I to answer your questions. Each caller will be allowed one question and one follow-up question to provide all callers an opportunity to participate.
If time permits, the operator will allow additional questions from those who have already spoken.
Operator?
Thank you. If you would like to ask a question, please signal by pressing star 1 on your telephone keypad. And if you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, press star 1 to ask a question. We'll pause just a moment to allow everyone an opportunity to signal for questions.
And we will go first to John VanderMulten with Zacks.
Hey, good evening everyone. I saw that Global Cultured Meat note and wanted to know what the regulatory requirements are for getting that out there.
Joe, yeah, you want to answer that? Yeah, I mean these are all standard USDA food grade requirements. There are no additional requirements.
than we would expect.
I guess, oh, we have to interrupt the question you have.
Okay, all right, yeah, I mean that's an area I'm not too familiar with, so I'm sure that there are some kind of hurdles that are required to get that cleared, I guess, to be used with food product.
Well, yeah, for all the GMP manufacturing processes and obviously you'd have to have your USD certification for any of the plants that you'd be producing these materials at. But the areas that we're looking at would be more on wholesale, so the organizations that we would be partnering with would already have their.
GMP manufacturing processes and obviously you'd have to have your USD certification for any of the plants that you'd be producing these materials at. But the areas that we're looking at would be more on wholesale so the organizations that we would be partnering with would already have their certifications and licensures.
Okay, so it sounds like it's a lot, definitely a lot easier than going down the farmer road.
Yes, there's a question here.
Second question for me is on South Africa and possibly also India as well in terms of the phase one and the next steps.
I mean, I think for South Africa, you submitted the CTA, which I assume is similar to an IND in the United States. Is there some kind of time period there? Can you differentiate that relative to an IND and kind of what's required to start the trial after that's submitted?
Yes, this is Joe. It's very similar to an IND. There is an eight-week review period after submission, or at least for COVID in South Africa, there is an eight-week review period at the current time. And after following the review period, if approved, then you are given the green light to begin the initiation of your trial. So in the U.S. it's a little bit different when you file an IND.
You provide your data package and if you do not hear back from the FDA within 30 days you can start your trial. So it's a little bit a little different but the specifications or the requirements are roughly the same of what you're asked to provide. It's just a little different process.
Okay, and then last thing is just on epigen for the same topic. I'm sorry Mark, you were saying something.
Well, I think it's important to note that we basically produce this material, the drug substance and the drug product, under EMA and FDA quality standards to produce CMC, so to overcome in the future not only for this particular product, but we've demonstrated now proof that we can produce CMC quality materials.
For future products as well. It's the same data package that you would submit to any regulatory authority. Yes, absolutely So there's no cutting corners and no cutting out quality. We spend the time and the money and the effort with the quality
consultants, regulatory and CNC consultants like ParaXcel and others to make sure that we would be able to use this knowledge and expertise and leverage it for decades to come.
Great. And then is that kind of IND type of thing the next step in India?
Well, I think in India they're not as far advanced as we are because they just started later, but they're in the process of doing their qualifications for their CMC package right now. And from there they'll be moving towards finishing some of their preclinical studies that they have to do and then moving into their potential Phase I, Phase II clinical trial funded by BIRAC or the Indian government. So we certainly expect to be into the clinic much faster than they are.
with the Saffra, South African filing that we made on the 22nd of July .
Okay, great. Thank you, Mark.
Thank you, Mark. Thank you, Joe.
We will go next to Vernon Bernadino with HC Wienwright.
Hi, Mark, Peng, and Joe. Thanks for taking my question. Congrats on the process with all the efforts on business development and especially the YAI 100. Regarding the latter, I was just wondering, besides safety, what kind of early efficacy data, as Joe mentioned, might you announce perhaps later this year?
I'm sorry, we're related to the vaccine, correct?
Yes. DYM. Immunogenicity data. So there are endpoints in the trial. I really can't get into those on the call, but we do have those in the trial. The preliminary efficacy will be part of the endpoints.
But specifically, that's what we're looking at. So there will be parts of those.
So we're going to be looking at obviously neutralizing antibodies, T cells, and all the things you would normally do, but in general we can't get into the details.
But everything you would expect in detail we're getting into in serology.
Perfect. Regarding the programs and the collaboration with Janssen, I am just wondering if you could provide a little more detail as far as any kind of progress they have made, not specifically, for example, targets, but perhaps the amount of activity that they have been involved in and what may be next year as far as milestones regarding that program.
Well, I think we've seen significant progress, as I mentioned in the earlier part of the call. We've had some scientific milestones and achievements that are truly amazing in terms of yield increases and modifications in the glycoengineering.
So I think we're on target to achieve the goals and objectives in that program.
And so I think Janssen is very happy about that. I can't really get into much more detail at the moment because of confidentiality.
But we have two different products that we're working on there, which we've mentioned. One's a monoclonal antibody and the other one is a life-specific.
So I think we have both of them on target moving forward to get towards those milestones that you referred to, which are development milestones in the seven figures potentially, and then of course the nine figure per product ultimately upon commercialization if successful.
I know you have lots of programs and so definitely I have demonstrated you can speak into them at the same time. Which of the programs besides, let's say, the YA100, because it's the most advanced, what are the programs you think would produce the next milestone for the company?
Well, keep in mind, DUA-100 is a vaccine solely owned product of dyadic itself, our own pipeline. We have also, we mentioned the COVID-19 monoclonal antibody that's
working with conjunction with the European scientists, just finishing the non-human primary study just concluded in terms of the actual application of it. And by the way, the animals all look healthy, but they need to go into the data now, which is taking some time. But also what we're doing here with the safety of DY100, we're in discussions with more than half a dozen big pharma companies.
And we're talking to them about all kinds of things, like NA, neuraminidase, to potentially enhance influenza to go along with either RHA or HAs that they already produced from themselves.
And in addition to that, the platform in general, we think that the doors are going to go open up very wide, very quickly, but potentially some of the big pharma companies for some of the other advancements that we're demonstrating to the scientific data and achievements, some of which we've talked about today and some which we intend to talk about either sometime between now and Q3 or in the third quarter that we're starting to see some of the results from. Thank you.
And as a reminder, it is star 1 on your telephone keypad. If you do have a question at this time, that is star 1.
I will go next to carry Luskin with 21st Century Investment Group.
Hi, Mark. How are you?
Hey, Carrie, how about you? I'm doing fine, thanks. Appreciate the update. I wanted to ask you what kind of interest, well it has to do with the cultured meat, what was the genesis for moving in that direction? What kind of interest are you getting? And you know, can you elaborate a little bit maybe on market size or the opportunity in cultured meat?
Yeah, I'll start and then I'll let Joe chime in. You know, it came from an initial sort of getting our feet wet, if you remember, with turtle tree in about a year ago when we started looking at evaluating, can C1 be used to produce.
non-animal proteins for cultured meat and other applications. That led into the food ingredient project that we have, which is a multi-national company, one of the largest in their space as you know, it's about a 1.5 billion dollar revenue company, but it's a private company. And so that kind of led that, and that's the foundation as we see, and we've been engineering the Daphneus microbial platform technology.
in the last year or two to try to move into the non-pharmaceutical space as well because of the C1's potential to produce proteins. And you know the world of proteins is emerging in all kinds of industries and applications.
In cultured meat, we've got people reaching into us and we're reaching out to others that are looking to use our technology to produce
what's called media that's used for the feeding of the cultured meat cells so they can induce these cells economically in a viable manner. And if you don't bring that media cost down, which means larger volumes of lower cost production, which is obviously our expertise.
That is where we entered that space. It is where we dragged into it in some ways, but now taking advantage and reaching out. Joe, maybe you can talk about the size of it. The size of it also depends on who you want to look at. The market potential has been estimated anywhere from $150 billion to $500 billion. I'm not sure I would put it at that high, but you can see the amount of dollars flowing in, the investment level doubled.
in the last year alone. And I think you're going to continue to see, as you look at the companies that are entering into this space on the supply side, you'll see pharmaceutical companies in there. And when you see that happening, you can definitely tell this is a market that is going to continue to expand and grow. So as we look at it, it's also a market in need of a significant portion of high-quality recombinant proteins, but the cost is what's prohibiting the real take-off of this market.
our technology to really drive the cost down of these components that are going to be critical that that industry is going to succeed.
to really drive the cost down of these components that are going to be critical if that industry is going to succeed. Thanks so much, Mark.
And we'll hear next from Robert Smith with Center for Performance Investing.
Good afternoon. Thanks for taking my questions. So Mark, can you give us some ideas of the timeline until the next milestone with Janssen?
That's a hard thing to give you a timeline from Janssen because Big Pharma has their own timelines they operate on.
I mean, it could be as early as sometime. My guess would be either later this year or early next year for the first milestone.
But at any given moment, they may decide to step up after seeing the data on some of the other technologies in addition to their own project. Some of the other discussions we have ongoing with different aspects of Janssen that have nothing to do with therapeutic protein, but potentially vaccines and other areas where they have had some trouble sort of applying their technology platform. We think C1 is ideally suited for that. I think we're getting attention on the other side of there.
organization and I think that C1 is the answer to a lot of the problems and issues that they came in we can help them overcome that.
And they know because they've worked with us in the past and they're working with us now, that we're dedicated, the technology is real, it's producing fabulous results on the other side of the equation. And when they see the data, and we'll talk about some of that I hope somewhere between now and Q3 conference call.
on some of the advances we're making that are just almost mind-blowing in the case of the vaccines out of the equation in terms of improving yields and demonstrating safety. If we can demonstrate safety with Saphra, I think the sky's the limit.
And then just circling back to South Africa, so the work you're doing with your own
vaccine. I mean that's targeted at a certain
variant with
the variants coming
Fast and furious so to speak over time, where does that leave you with what you are working with them.
I think it leaves us in the driver's seat, to be honest with you. I think if you really look at the speed at which we can develop a new cell line and the yield and productivity, think about the seasonal flu. You have to be able to rapidly at least twice a year or once a year in the northern hemisphere, once you're in the southern hemisphere, to be able to develop hemagglutinin, potentially neuraminidase, we're in that space as well. But for the COVID-19 vaccine opportunity, we already have Wuhan, Alpha, Beta, Gamma, Delta, BA1.
We are starting to work on BA5.
So we can keep up with that what's called a multivalent or bivalent. If you look at what the FDA and the vaccine conference that they've had, and the discussions they're talking about bivalent vaccines with Omicron and Wuhan or Omicron and Delta.
So I think that we can actually bring those forward faster in a global population and of course here in America. I believe that the recombinant protein vaccines...
are coming of age, it's the right time. With Novavax getting approved, albeit not adopted widely, and that's because again, it's a Wuhan based vaccine in an Omicron world.
So I think we're going to be able to do that. And then again, what are they looking for? They're looking for what's called a pan coronavirus vaccine, something that covers the variants. And there are things going on, I'm not in the liberty to discuss right now, but I sort of intimated that sometime between now and Q3 in our conference call, we're seeing some data on a potentially next generation pan coronavirus opportunity being produced in C1. And we're not the only ones seeing it. That data is being shared with.
several of the big pharmaceutical vaccine players, as well as back technology companies and governmental agencies from the top of the FDA to bar it down.
So we're on the radar screen and I think we have the ability to mass produce things at levels but mass producing the right thing is the key.
I think we have the opportunity to mass produce the right things and hopefully we can get a big pharma partner, governmental support and to move this into the next level.
opportunity to mass produce the right things and hopefully we can get a big pharma partner, governmental support and to move this into the next level. Beyond Safety
Safety is coming. It's going to open the doors. But the scientific data on the yield, on the technology, and the diversity in breadth and scope of what C1 is producing for vaccine, the common protein vaccine, is what's going to carry the day.
And with no other questions in the queue at this time I would like to turn the call to Mark Imo-Barb. So Mark Imo-Barb is on the line for all the good identify
Diana's CEO for closing remarks.
We have exciting prospects for the balance of 2022 and beyond as we continue advancing our first in human clinical trial application, CTA, to South Africa Health Product Regulatory Authority, SAFRA, to support clinical safety of C1-produced proteins.
Hopefully what you take from this call is we're not only focused on improving the value of dyadic to the life science industry, which will turn our intern to improve invaluable for shareholders and for populations around the globe.
We've taken definitive action by reorganizing our infrastructure and focused on strategies in order to prepare Dyadic for exploiting existing and emerging new opportunities for commercialization to enable us to fulfill our mission as a global biotechnology company in order to improve the way we feed fuel and heal the world.
Thank you once again for joining us in today's Q2 2022 conference call, and we look forward to keeping you updated as we advance our commercial and scientific initiatives across the companies and our collaborators' programs. We also look forward to seeing you on the next call, and I hope you keep an eye out for our periodic updates.
And so this concludes today's call. Thanks for your participation. You may now disconnect.
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