4basebio (LSE:4BB) — Investor update

0:01 Good morning, ladies and gentlemen, and welcome to the 4BASEBIO Investor Presentation. Throughout this presentation, investors will be in listen only mode. Questions are encouraged, can be submitted at any time using the Q and A tab situated on the right hand corner of your screen. Please just simply type in your question and press send. The company may not be in a position to answer every question received during the meeting itself. However, company review all questions submitted today and publish responses where it's appropriate to do so. These will be available via your Investor Meet company dashboard, and we'll send you an email to notify you when they're ready for your review. I'd also like to remind you that this presentation is being recorded. Before we begin, we would like to submit the following poll. And if you give that your kind attention, we'll be most grateful. I'd now like to hand over to Heikki Lundgreit, CEO and David Roth, CFO from 4BASEBIO. Good morning to you both.

0:50 Thank you, Mark, and welcome, everybody, to today's call. And and thanks very much for taking time out of out of your busy schedules today to dial in for our investor update call.

1:00 So today on the call, it's gonna be David and myself from the 4BASEBIO team. We'll be shutting down our cameras once we go into the the presentation as well. But then when we get to the q and a, we'll we'll open it up again. But before we proceed, as you know, we have to take you to our usual disclaimer. So I will just give you a second or two to read through that.

1:26 Right then. So today, we're gonna start off with a snapshot overview of the company where I'll touch on our products and technologies and provide you some further context to the applications where where we really think our technologies can have a the potential to make a real difference. I'll also give you some insights into the progress we've made in the different areas of our business, and I wanna provide you with some guidance on what we expect or what you can expect from us in the in the near and midterm. David will will then take over from me for a few slides and give you a bit of insight from the financial position of the company, and then I'll finally pick up again and actually take you through what I think are the most exciting slides of of today where I'll take you through some technical results obtained with our products and some of the key target applications that we we think we can make a difference.

2:17 So first things first then. A bit of a snapshot overview. You know, as you know, we are building a life sciences company, but really with two core objectives. So the core premise of the company is to make large quantities of clinical grade DNA that can be used as either a therapeutic agent or or as a critical component in the manufacture of cell and gene therapies or mRNA vaccines. As you know, we have we've developed this proprietary and patented processes and and the products that come out of that that will enable us to do exactly that. But there is, of course, still quite a bit of work to be done to get our processes to the required scale and obtain our GMP licensing before we we can start commercializing our products. So that's the DNA side of the business. In addition to making DNA, we want to develop a next generation gene delivery platform to safely and efficiently deliver our DNA products into target cells and tissues.

3:12 You know, that's really to compete with the current viral based methods, which continue to have significant constraints in terms of payload capacity, immunogenicity, but also, sorry, but also in terms of long term efficacy. So our view is that, you know, nonviral based methods, so such as the HAM's platform that we are developing, really are the future of safe and effective gene delivery. And the successes that we've seen with the Moderna and the Pfizer vaccines of the viral based alternatives, such such as the a zed and the Johnson and Johnson kind of products, really strengthens our belief that this this non nonviral approach really will become the dominant kind of force in in gene therapy and gene delivery. It's clear that our products and technologies serve a fast growth market with compound growth rates predicted in the mid thirties. So, you know, I think we're really in a great position to to benefit from these market trends that that are coming towards us.

4:02 But as you know, timing is essential and, you know, we really have to push on with the the build out of our clean rooms so that we can start producing materials on the the quality assurance and quality standards that are required by our customers. Therefore, you can expect our headcount to keep growing and, you know, I kind of expect our our FTE rates to be around the fifth the mid 30 the mid 30 is around 35 by the end of the by the end of the year.

4:33 Moving on then to the next slide, I'd like to take a moment to touch on our technologies. I mean, for some of you who have have been doing some reading on our website, this probably will be very familiar territory. But but, essentially, core to everything we do in the organization is our proof of technology. That's kind of the central technology that, you know, drives everything we do underneath it. This is the technology that enable that enables us to accurately and quickly create DNA. And it's that DNA that is then further processed into a product, which is more suitable for use in in the different application areas that we're targeting. You know, you will have seen our recent press release about OS DNA. So we now make two products, you know, the HP DNA, which is a a linear close type of DNA, and then the OS DNA, the new type of DNA that we make, which is an open ended an open form of double stranded DNA, but also enzymatically resistant.

5:25 So, you know, both of those products are are now excellent products. So depending on the application that you focus on, one is likely to be more suited than the other. But, again, I'll I'll come back to that later in the presentation.

5:40 So once we've made the DNA, obviously, we then need to get this DNA into into our target gel. So into our target cells so that these genes can can be expressed. And this is where our Hermes Hermes non viral delivery platform comes into play. As with everything in the world, given that plasma DNA really was the only available source of DNA, all these delivery systems that have been generated have been optimized for encapsulating the circular super cold type of DNA, which is plasma DNA. The type of DNA we make, however, the linear DNA is is very different and and behaves entirely different to to to plasma DNA. So our objective is to design a delivery strategy that is optimized for the linear DNA products that we create. Now having said that, the the Hermes platform is, of course, also suitable to deliver all types of DNA and plasma DNA is part of that, but it can also deliver RNA or even protein.

6:33 But I I I would like to stress that for us, you know, our first priority is is really to focus on facilitating a non vial based method for the effective and safe delivery of the linear DNA constructs that we make. So a bit more on OS DNA perhaps. I'm really excited about this product and and the opportunities that it presents as this product really is ideally suited for m r a production. And given the current surge in demand for m r a vaccines, I think it's obvious to everyone that this is clearly a very rapid growth segment for the company. And and why this is so so important to us is that that, you know, if you look at how people make mRNA to to make these products, you really need open linear constructs to get clean target DNA transcripts, you know, out out of the the production process.

7:23 And this is really what why the OS DNA is the I ideal product for this application. Combine that with our ability to create highly accurate linear DNA templates of pretty much any size, which on top of that can also incorporate these really tricky bits of sequences such as, like, the homo polymeric sequence sequences of the tandem repeats or the ITR that people often want in their sequences. And you can see that we we're in a really strong position to become extremely competitive in this market segment. So, yeah, we're we're we're super excited about, you know, the opportunity just presents. Needless to say that, of course, intellectual property is is essential in in all of this and particularly in creating shareholder value. So I'm extremely pleased that, you know, development of of this product and this technology, we've been generating really good new new intellectual property, which really has enhanced the the already strong position we had over our DNA synthesis platforms.

8:16 And I'm I'm truly convinced that, you know, as time moves forward and and we continue to invest in our platforms, we will also continue to add strength to our our patent portfolio, which is, of course, very important for for future shareholder value. So for our DNA products then. So this slide, it really is more of an overview slide on on on where we see the utility and and the USPs of the the DNA products that we make. And these products, you know, we see really being used either directly as a therapeutic agent. So, you know, that could be as a DNA vaccine where, you know, the the DNA really is, you know, the the therapeutic agent. But, of course, also embedded in a a non vial based gene therapy so that the Hermes particles that we develop will will contain these these DNA templates.

9:05 However, when you look at the mRNA and the AAV kind of opportunities, our DNA there isn't actually going to go into the patient. You know, it's it's more like a critical ingredient in the manufacturing process of of these products, but it doesn't form part of the final composition. And that's really because the DNA is either transcribed into mRNA in in the manufacturing process or it's replicated into a viral genome as part of the the AAV production process. That is actually a very important point to to make because it has a significant impact on the quality standard that is required for these different So you can see that where where we use our products as a therapeutic agents, the q c and q a requirements are are substantially higher compared to using it as a critical critical ingredient in some of these manufacturing processes.

9:51 But again, I'll I'll touch a little bit more about this in in in our technical insight slides further than in this presentation. So our our DNA technology is clearly uniquely positioned and and addresses really many of the concerns that are associated with plasma DNA. And that's really because the process is entirely enzymatic, which leads to a much cleaner product as we don't really have to worry about endotoxins and any kind of bacterial protein or DNA contamination in our DNA preps. More importantly, we can also produce our products much more rapidly compared to what we can do with plasmid fermentation as we avoid time consuming steps such as cell banking and fermentation processes.

10:36 And also our downstream our downstream purification is is so much more simple as we have far less volume to to produce and and far fewer contaminants to remove. So we end up with a a cleaner and more efficient process, which has cost advantages, of course, but also has lead time advantages which our customers highly appreciate. So moreover, the end product on a mass for mass basis as well contains more copies of the target gene. And and that's simply because if you look at our our DNA constructs, we don't have any bacterial elements within that DNA construct. So on a mass for mass basis, we can put more copies of the target gene into one gram of DNA compared to to plasma DNA. So moving on to the next slide.

11:21 And this is really a similar kind of slide, but now focusing more on our on our nanoparticles on our on our Hermes platform, which really is a technology that enable us to efficiently package payloads and and deliver these payloads to very specifically to to target cells. As mentioned earlier, we are focusing our efforts on establishing technology that will enable us to package linear form of DNA, which, again, I have to stress, behave completely differently to circular plasma DNA molecules. But my view is that actually the targeting capabilities of particles will be an essential part in mitigating any kind of unwanted side effects of a potential therapy further down the line. And the exciting thing for us is that the early work we've done so far has has shown some really good promise promising targeting efficiency. So we really have confidence that this this technology will work and and deliver on its promise.

12:13 Ultimately, though, for our objective is to enable the delivery of much large genes than currently possible with AAV vectors. You know, one of the other drawbacks of AAVs is is the kind of four and a half KB size limitation. And and to enable way for repeat dose strategies so that we can develop therapies that will have a much longer therapeutic effect compared to what currently can be achieved with AAV vectors.

12:39 So time lines are always important. So, you know, in the next few slides, we'll give you a little bit of an indication on what you can expect from us. Now 2021 so far has been an amazing year, really. And and we've truly made huge strides in advancing the company on on so many levels. The talent we've been able to recruit into our Cambridge based labs has had a tremendous impact on on the advancement of our DNA validation and our and our vector development programs. But also our Spanish team has worked relentlessly to drive scale and efficiency in our synthesis platform. Now all of that hard work has put us into a great position where we believe we can now completely transfer these processes that we've developed to quality control environment. And so so we started really picking up the pace and and bringing our clean room development and our and our GP work in house with, of course, with the help and the support of the necessary experts and expertise and consultants that we we we rely on to to make sure we we we make the right decisions in in these processes.

13:40 So near term then, you can expect, you know well, I think, you know, we we need to continue investing obviously in the in the build up and building up the confidence in our DNA products across a wide range range of applications. This has to be one of our our quick our primary objectives. And as mentioned earlier, we really see mRNA and the AAV production as the areas where our DNA products can make a very early impact. So, you know, our focus has been to work hard on on on establishing proof of concept data in the in these areas, and I'll I'll touch more on that in in in my later slides. But we also see that we can make good impact, and we see a lot of opportunity in cell therapy areas such as CAR T and, of course, the non viral gene therapy where we think our our g our Hermes platform can can make a significant impact.

14:37 If you look at the field today, it's clear that AAV is currently the delivery mechanism of choice. But the success of the COVID vaccines has given lipid nanoparticles and non viral based methods some serious pull. You know, these things really do work and and and, you know, people are are not convinced that they they they have a meaningful place in the in in the clinic. There's also a growing trend towards gene editing strategies, which again is for us a great area to be in because the gene editing, you you need linear templates to insert into the into the genome. Then, of course, that's exactly what we make. So we think our linear templates will be ideally suited in that application area and then and that growing market trend. So you can see, you know, the the kind of the field is is moving in that in that direction, and and we're really excited about, you know, the opportunities that that presents itself for us.

15:27 On the particle side, you know, we we're more focused on creating an an an optimized particle to package the the DNA we make. And we've set our sight on a few tissues and and indications there where we really believe that we can make a a significant impact. And you will have seen our press release with Royal Holloway, the the Royal Holloway project where, you know, we are working on a muscle based indication, muscular dystrophy, which obviously for Us is a a key focal point in in this area. All of this work, you know, is expected as, you know, you know, with the DNA since platform is expected to generate valuable IP. And so both on the DNA side and on the nanoparticle side, we expect to continue to strengthen our our IP portfolio as the development programs progress and continue to advance.

16:14 Alongside this, you know, we also need to advance the GMP build out, I expect that we'll probably complete our first clean room suites by the end of the year, which is really exciting for us. And, of course, therefore, I think it's realistic that we can, you know, probably be operational in in early twenty twenty, you know, with our our first clean rooms. I have to point out that the GMP licensing will, of course, take a little longer. And and to some extent, the timing of this is not really in our hands. It's somewhat out of our control. But we do expect to to be able to commercialize commercialize this product from our clean rooms in 2022 in any event because many of our customers, you know, will will work with us as we go go through this kind of licensing approach. So moving on to the next slide.

17:02 Sorry. I've I've discussed the near term already, so this is really more like a recap. So you can you can read this through. But what happens really beyond that is is what's interesting on this slide. So it's obvious that I think our our first commercial objectives have to be to initiate the the sale of DNA products, really in the IVT and the AAV kind of market segments. But in the long run, we expect these revenue streams to to lead to a CDMO style business that will supply DNA across a multitude of applications. On the other hand, we do expect that the harness platform has a slightly different path and, you know, as we validate across several indications, you know, which we intend to take take through IND into early stage clinical prize trials, would expect that at that point, our delivery platform will become highly suited for ad licensing opportunities.

17:54 So, you know, on the one hand, we have a product, the CDMO business which will sell product. And on the other hand, we

17:59 have more of a a platform technology which which we would expect the licensing as and when the validation has has has progressed. So, you know, I I think, you know, if you look between the lines, I think you you can see that we think that within the 4BASEBIO UK society as group, we can see two business units with with very different life cycles and and really also very different valuation metrics emerging. You know? So on the one hand, you know, there's a CDMO style business looking to supply GMP GMP grade DNA products into into all these markets. That's highly likely to be high growth, high revenue generating, and and very profitable business unit. And that, of course, stand in sharp contrast to our discovery business unit where revenue generation will be more licensing driven.

18:47 And the revenue then the revenue generation is also much further out in time. So, you know, you can expect that business unit to actually be much more cash hungry for the foreseeable future. Anyway, so that's it for my first part. I will now hand over to David, who will say a few words about our financial position, and then I'll take you through some tech slides after that. Thank you. Thank you, Heiko. Good morning, everyone. I I have a brief cameo. I'd like talk about the financial position and funding, after which Heikki will take you through some of the site of information in more detail. So I've only got a couple of slides, but hopefully, they're they're interesting. I'm sure we have the technology already. Oh, apologies, everyone. So financial summary.

19:34 As you may know, we published our financial results for 2020 at the beginning of June. And these results really reflect the group position following the spin out from 4BASEBIO AG at the end of December twenty twenty. And it's fair to say that while we've reported on this and, you know, we're we're perfectly satisfied with the results, they're not really reflective of of of the position going forward. But it's it's worth just touching on them and and explaining briefly the context of those results. So the accounting was was pretty complex. There's some debate on the IFRS three, how you account for for the sort of spin out and acquisition of of ongoing activities as as was as we had. And therefore, the way we've accounted for this is that we have essentially the full year results of 4BASEBIO SLU, which is our Spanish subsidiary, as well as a a very limited stub period for The UK company, which was deemed to be acquired on the December 8. And alongside that, there was also just a little bit of activity in in The UK society. So, really, when you compare that historic period to what we're gonna have going forward, clearly, the the the will be a full year results moving forward for both UK and Spain.

20:56 Whereas in 2020, there was only that that that limited period for The UK. And also, it really doesn't reflect the scaling of the lab teams that occurred towards the tail end of 2020, but also more significantly during the early course of 2021. And I guess the most meaningful number coming out of these results is is the cash balances that we started 2021, which is 15,000,000 approximately 15,000,000 of cash. But, necessarily, I think we've indicated before that we are essentially in a pre revenue situation. We have some revenues which have been brought forward from from Spain, and those revenues will continue. And we expect them we we don't expect those revenues to grow significantly. We're also not really expecting them to decline very much. So there'll be this recurring revenue, but it's it's pretty much a legacy revenue and not and not core to the business going forward.

21:55 Having said that, and and I guess where we are now is our efforts and our ambition is to commercialize, our products over the course of, '21 and particularly '22. And clearly, may have a significant impact on the overall results and and performance moving forward. But assuming that we remain relatively static in the near term on our legacy revenue position, the group inevitably will be in a in a significant cash burn position. And as a result of that, we we would expect our cash runway to to last well into 2023. And then beyond that, I think as we've reported as well, we have access to a £22,000,000 loan facility. So clearly, we are we are in in in very good financial shape and well placed to make investments necessary to commercialize technologies, to invest in our team, and also make whatever necessary CapEx expenditure that we require.

22:49 So having said that, I just wanna turn briefly to to funding to to just explain where we are in terms of our thinking. So because of the combination of cash and loan facility, no funding no fundraising is foreseen, and and certainly nothing is planned. And so the question really is, in what circumstances might we look to raise additional capital? And and I guess perhaps before answering that question, the most important point is that any capital raise would need to be at a share price or a or a market value with which the board is comfortable. It's hard to say what that would be, and I guess it really depends on the situation at the time. But I I I think it's fair to say that we'd be looking for very meaningful appreciation on the current share price before we would contemplate any any sort of of fundraising.

23:42 And then the circumstances where we might then consider it is is if there's a very significant capital investment needed, and ideally, that would coincide with a value inflection point. So, for example, a large scale GMP facility or ongoing investments into indications that are moving into clinical trials. And then another scenario might be where we think it makes sense from a strategic position and and from a valuation position to bring in a specialist institution investor to offer validation of the company valuation and the technology. But I'd reiterate that we've no plans for a capital increase at this time or for the foreseeable future, and we expect to continue to proceed entirely within our available resources.

24:28 So that's really my cameo. I'll pass back to Heiko now who will take you through some of the insights. David. Alright. So, yeah, those who've been listen listening to to my a lot of slides and my pictures, you know, I've I've heard me talk a lot about the strengths and the benefits of our technologies and the products that we we make. And so in in the next few few slides, I I I'd really like to put some meat to the bone there with some data validating some of these statements that we've been making, and also showcase how our products are performing in in these key application areas that we've identified. What I really want is that the main take home messages from this is that, you know, you can see that, you know, a, we can really make high quality DNA products, and b, that these work extremely well in IVC based mRNA production and AAV production.

25:20 So here we go then. This first slide is really more of an introductory slide, and it kinda shows you that we can make DNA constructs. Sorry. And that the amplification process that we have typically yields us DNA at a concentration of one gram per liter. So if you look at the slide and at the graph, you can see that, you know, somewhere around point nine and and and just over one milligram per milliliter or gram per liter is kind of DNA output that we get. Now that's actually about a thousand fold higher than what you typically can achieve on fermentation based approaches. So that's meaningful in terms of bringing our size and scale down and bringing our cost down. I've also put in some tangible data on the fidelity of our application, which shows that, you know, our prices really is about 200,000 times more accurate compared to the conventional PCR based approaches.

26:13 So again, the overall conclusion from this slide is that we can make top point DNA at a really high concentration. Moving on to the next slide. This really shows the ability or our ability to make small and longer DNA constructs. So what you see here is an agarose gel. So the gel the gel really just functions as a molecular sieve, and and the smaller DNA pieces will migrate deeper than the gel compared to the larger pieces, which are retained higher up in the gel. So a construct of a given size will therefore condense into a discrete band on on the gel. And on on our gel here, you can see that the smallest construct is around 1,800 base pairs. So 1.8 kilobases, so 800 base pairs. And the largest one is around 11,900 base pairs.

27:00 Now, you know, this is just a a snapshot of what we do. We can make smaller. We can make bigger. But you can see, you know, we're able to to make a wide range of sizes of products. Also, then also you know, I think what's also very important on on on this slide is that, you know, we can make clean product. So you can see that on on the gel that that really is just a single discrete band. You know? So there's no contaminant or fragmented DNA present above or below below the target bands. So from a DNA perspective, this this shows you that we have a very clean DNA product. And, of course, with the fidelity that you've seen on on the previous slide, you also know that the the DNA construct will

27:43 be highly accurate and will be the right sequence that the customer is is wanting. But as you know, our processes are enzymatically driven. So for us, it's critical that we can also demonstrate we can remove these enzymes from from the final DNA product. And to prove that we have removed these protein contaminants from from the DNA preps, we run a different type of gel. So it's essentially still a molecular sieve, but now it's designed to separate and visualize the protein, the enzymes rather than the DNA. And I'll take you through that on the next slide. So on the left hand side here, what you can see is a Komassi stain gel. So Komasi is a blue dye that, you know, likes to bind proteins and and makes them blue. So what we've done here is we've loaded two, four, and six micrograms of purified DNA, and what you see is we cannot absorb any protein band on the gel. So if you look at the the first lane of the first column or u, you can see there's a few bands there. So these are essentially protein bands.

28:42 If you look at the two, four, and six microgram lanes, there's essentially nothing there. Now this allows us to estimate that our purity in is is in excess of 98% because we would expect to see a 100 nanogram band. So if you divide, you know, 6,000 nanograms or six micrograms over a 100, you you you get that kind of purity. If you use the same approach now, but we use a stain, which is actually much more sensitive like silver stain, again, you can see that we can't see any kind of bands on the gel that correspond with the enzymes we've used in our production processes. So in the pre purification lane, you can see a lot of protein bands. In the purified lane, you cannot see any protein bands. The only protein you can see is the DNA is one that we've actually had to add to these samples to digest the DNA because DNA also stays with silver, and it generates a lot of background that would prevent us from doing the analysis.

29:39 Now, again, off of this slide, you know, we can estimate a purity of around 99% or actually in excess of 99%. So you can see that overall, the take home from this slide is that we can very efficiently remove our processing enzymes from the from the final product and and deliver a very clean and pure product to our customers.

29:57 So I think the first two slides show you that we we can make good quality, high quality, very pure DNA. Moving on now to the application area. So the first one here is just a bit of a an overview of DMD collaboration. So I I think it's very important to to provide some context on the DMD collaboration with Royal Holloway and why we think this indication is really ideally suited for our technologies. For those of you who not who are not familiar with DMD, it is an x linked inherited monogenic disease caused by mutations in the DMD gene, and has an incident rate of about one in five thousand male birds, yeah, as it is on on the, x y kind of genes. The the DMD gene the DMD gene is is actually one of the big ones with a DNA sequence coding for dystrophin, so the protein that has been compromised in the affected people being about 12,000 bases long.

30:54 We know AAV vectors can only pack four and a half thousand base pairs, so you can see that there's there's a significant problem here. So to make an AAV strategy work, you know, people have to cut back on on the payloads. So and that results in, you know, excellent skip skipping strategies or or delivery of micro dystrophins, you know, which which is essentially an abbreviated version of the real protein that is required.

31:16 Now the problem with AAV vectors as well is that you you really require very high viral titan. So that's the concentration of viral particles that is used to to dose to people. And that's really required to achieve the desirable level of transduction and and getting enough transgene into into the muscle cells.

31:36 This is caused by the fact that, you know, the AAV vectors can really only be dosed once because of their immunogenicity issues. And, of course, these high viral loads that are required often lead to to toxicity and and and adverse effects, you know, then again compromising the success of a potential treatment.

31:56 So our objective is now to create a Hermes based DNA vector that can deliver a highly effective path to full length dystrophin gene specifically to these muscle cells. Yeah. And due to the preferable immunological properties of our homage vectors, at least compared to to viral vectors, we we anticipate that, you know, we could really enable repeat dosing strategies. And that, of course, in turn will then benefit from lower toxicity and adverse effects and create the possibility for prolonged therapeutic effects.

32:26 Now developing and validating these vectors is unfortunately not quick. It's a long process, but I think it it'd be useful for us to provide some indication on what we think the next steps will be in this project. You know? So currently, we are validating the vector with a reported gene and and in vitro cell lines. So this is just in a lab here in in in Cambridge. But the real objective is to demonstrate that we can specifically and effectively deliver the the transgene to muscle cell. Once that's completed, we anticipate to to move towards in vivo animal validation of this vector, and I expect that, you know, that's probably be that probably will be completed around around the year end. I think that will then put us in a in a great position to evaluate the therapeutic records, so we're actually incorporating the the the DMD gene. And, initially, we'll do this in a single dose study, and that will then be followed up with a repeat dose study in 2022.

33:25 So you can see there's there's a lot of work still to be done, but the early work is is moving through very nicely. And as and when we move through these stages, we'll, of course, keep you informed and update you about the progress that we make.

33:38 So now into the application areas where we think the DNA can make some some early commercial impact. So and I think this slide is is really quite nice as as it demonstrates the utility of our MS DNA products in mRNA production. I think by now, you all know the value of mRNA and what these products have achieved in achieved achieved in terms of beating COVID pandemic as both the Pfizer and the Moderna vaccine are essentially mRNA products. And the success in vaccines will really drive the demand for mRNA with with some vaccine makers expected to require potentially maybe even a 100 kilograms of DNA per annum. So, I mean, these quantities are actually hard to get your head around. And and definitely, at this stage, the global production capacity of DNA is nowhere near that level. So there there's clearly a huge amount of growth in in that segment.

34:31 We estimate that the cost of DNA for a single vaccine dose will probably be in the region of 50¢, maybe a few dollars. But, evidently, where a billion doses are required, you know, the market opportunity is is clearly very, very significant. So the exciting thing about this slide is that, you know, in our hands, at least, you know, our linear DNA products are clearly outperforming the current source of DNA as in the the linear linearized plasmid, and we can achieve about 10 to eight times more target DNA compared to plasma DNA. Moreover, we also observed that our mRNA preps are a lot cleaner compared to what we can achieve with plasma DNA, which we think is, again, due to the the higher purity of the DNA products that we make. So the single band of the that you can see on the agarose gel and the and the lack of protein contaminants, which I explained a couple of slides ago, is really working in our favor here. And, obviously, you know, we now need to get this product validated in the hands of a bunch of customers, which is the next stage of the development we're now entering in in in this in this project.

35:34 Moving on to the next slide. So these next two slides are are really more about AAV. So, you know and what I what I really wanna showcase here is the excellent performance that we achieve with our DNA products when we use them to make AAV particles, you know, that that other lower hanging fruit commercial opportunity that that I've talked about today. So AAV, you know, as as I said, is is really the primary choice of of vector for gene therapies at the moment, and there's there's many, many clinical trials on the go at this point. And the cost of a single dose of DNA for for an AAV therapy can vary quite significant, but you can see, you know, somewhere between 75 and $10,000 per per patient is is quite significant. Now if you look at the chart, the blue bars represent transfection efficiency, and that is essentially a measure of how easily we can get our DNA into the AAV producer cells, so the cells that make the particles.

36:31 Now the data shows we can obtain similar or maybe even slightly better levels compared to plasma DNA, but what's really exciting is the red dots who which show that, you know, our constructs have higher expression compared to to plasma DNA, so more protein is being expressed. Here for for both experiments, we use the same mass dose of DNA. And as I explained before, you know, compared to plasma DNA, we have more copies of the transgene in one gram of DNA, and we attribute this effect, you know, really to the increase in expression that we have on on that basis. On the next slide, you can see this is actually commercially more relevant, I think, than the previous one because this really the the first slide showed really that that our DNA was was suitable for the production of AAV.

37:20 But on this slide, I think what we show is that the AAV particles that we make are actually better and of higher quality than the ones that you could obtain with plasma DNA. So, you know, when when AAV particles are are assembled, many of the the particles actually don't contain a viral genome. So there's there's a lot of empties around, and, of course, there's some full ones around too. But the packaging of DNA into particles is is really inefficient and and leads to very low full empty ratios. So what we've done is we compared the full empty ratios of the particles we've made with our DNA products to the particles that we've made with plasma DNA products. We noticed a substantial difference in full empty ratio with plasma DNA performing only half or about 30% as good as what we could achieve with the h b DNA products. So that's, you know, really quite quite exciting.

38:08 Now when we then did some further work, this was further corroborated when we looked at the infectious dose. You know? And that is essentially the the minimum dose that you require to infect population of cells. So it's it's it's a measure of potency of of the the particles that you've made. Now, obviously, the lower the dose, the better, as that means, you know, it's a more potent particle and that you can deliver your transgene more effectively with that. In our experiments, the the t c I v 50, you know, which is the measure of infectious dose, was about one or two logs lower, so about 10 or a hundredfold lower compared to what we achieved with plasmid DNA. So this shows that our DNA products generate particles of higher quality and higher potency, and that really strengthens our belief that our products have a really good role to play in viral vector manufacturing.

38:56 And and we're working, of course, hard now to progress our AAV program to the next level of commercial validation. So in summary, I hope you got the vibe that I feel the company is in in excellent shape, and I think we're really well funded to achieve our objectives. And and as David mentioned earlier, any future capital increase is entirely optional. But moreover, the current share price, we we don't really think it's appropriate. But we've worked hard to recruit additional scientific talent into the organization, and we'll continue doing so, of course, as we expand our operations. I really feel that now we've got a a very strong core scientific team, and I'm confident that our scientists will deliver and and pave the way for the commercial phase of our products and and technologies.

39:42 Consequently, I think, you know, you can see some strong strong value inflection points. Well, I can see some strong value inflection points around Horizon, which I hope will be appreciated by the market, of course, in due course. But, personally, I think, you know, the work that we'll be doing in the next six to eight months to to firmly establish our our clean room based DNA manufacturing capabilities along with the strengthening and the expansion of our proof of concept across, you know, a a wide range of commercially relevant DNA applications will have significant impact on the future financial performance and, ultimately, the the commercial success. And, you know, as always, we will keep you abreast of our developments as and when they materialize. So I think that's it for me. I would like to thank you all for listening, and we'll move on to any kind of questions as they may have come through. That's brilliant.

40:33 Thank you, David. Thank you very much indeed for updating investors this morning. Ladies and gentlemen, please do continue to submit your questions using the Q and A tab situated on the top right hand corner of your screen. But just while the company take a few moments to review investor questions submitted already, I'd like to remind you that a recording of this presentation, along with a copy of the slides and the published Q and A, can be accessed via your Investor Meet company dashboard, and we will send you an email to notify you when they're ready for your review. I'd also like to remind you that your feedback is important to the company. And immediately after the presentation has ended, you'll be redirected for the opportunity to provide feedback in order the company really understands your views and expectations. Hi, David. Obviously, the q and a tab on the right hand corner of your screen, if you'd be so kind as to open that. If I could ask you to to, where appropriate, read out the question and then give a response where it's appropriate to do so, and I will then pick up from you at the end. I don't know if your cameras are on or there we are. Perfect.

41:27 And if you need the slides, obviously, they're there for your use as well. Sure. Thanks, Mark. So first question to just read out is, can you expand a bit about the size of the company, please, number of employees, office locations, and what have you? So, gosh, where do you start with this? So in 2020, we were obviously a spin out from from 4BASEBIO AG, which is now to Invest AG. And and really at that point in time, The UK operation was essentially a service function of four individuals, and we also had a a significant research presence in Spain. And then during the course of 2020, we started to expand our base in The UK back to to to where we were previously. And I I suppose as part of the former life, we actually owned a building here near Cambridge.

42:21 And in September 2020, we we basically took possession of that again. So it's a freehold space of 12,000 square feet where we have labs, warehousing, and what have you. And we've we've essentially split our split our operations into two. So in Spain, in our in our research facility in Madrid, we focus primarily on on platform research around DNA. And also, there's a real expertise in in in in terms of enzyme manufacturing, enzyme development. Here in The UK, we are focusing more on on nanoparticle development and also the validation work that comes alongside that in terms of our DNA. So at the moment, we have around 27 employees, which is split about ten, eleven in Spain and the remainder here in Cambridge.

43:13 And then moving forward over the course of the year, there's gonna be a little bit of additional recruitment in Spain, But the the the principal focus is is here in terms of filling out our scientific teams, particularly around the the validation work and and and that that Heikki mentioned. So we expect to move and, clearly, it depends on recruitment timetables and whatever else, but we expect to move from around the 27 we have at the moment to beginning of next year, around 30 to 35 staff overall, of which around two thirds will be based here in The UK. Second question, what protection do you hold over the technology you have? I I think as Heikith mentioned, we a very significant value consideration for us is the intellectual property and and and the protection we have around around those products. And and and, clearly, that's pretty fundamental in terms of life sciences and and the capacity to to exploit that that intellectual property.

44:17 So we we have patents across the range of products that we have, and we continue to to create new IP as we as we validate and and develop our products and as we continue our research both both in in Spain and here in The UK. And that's really a a key consideration for us because, clearly, alongside the the capacity to manufacture DNA and also develop our nanoparticle technology, it it's also the opportunity to to of what that technology could be worth to others. So what what's it worth in terms of licensing around our nanoparticle technology and and the IP value that that sits within our DNA. So that's a key consideration for us, and, clearly, we spend a lot of time focusing on that intellectual property. Yeah.

45:05 I mean, if I can just touch them up as well. Mean, we're we're spending a lot of resources with at the moment. So, you know, we've announced on on IP filing recently as well. But, you know, with the with all the work that we do and, you know, it's probably not gonna come as a surprise that we're we're generating a lot of of new inventions and, you know, we're reducing this to practice, and we expect those to to generate, you know, new patent filings in in due course as well. So, yeah, I think as they as David mentioned, there's a lot of existing intellectual property, but there's a lot being added to it right now as well. Moving on to next question then. What do you view as the greatest risk to your short term goals? I mean I mean, for for me, it's probably talent equipment. You know? Yeah. I mean, we we got really good people that we've been able to equip. Of course, we we still have massive expansion plans, which means that we need to expand our teams along the way as well.

46:02 So, you know, continuing with recruiting the the best people is is is challenging, and and the rate of development and the pace of development that we have, you know, makes this probably one of our our biggest challenge. That's it. The next question is how does HP DNA and OS DNA compare to DoggyBone DNA from TouchLight? They're both synthetic products. I think as as Haiky alluded to in in the presentation, the demand for DNA going forward is is expected to to to increase exponentially. And and our view on this is that there's there's certainly more than enough space in this market for for one or more manufacturers of synthetic DNA.

46:48 And we're we're very pleased that they're in here because to some extent, they are pathfinders for for the synthetic DNA market. Yeah. We've got a couple of questions, but I have take the first one the second one first. What would be required for h pDNA or I sDNA to replace plasma DNA? Is it possible to replace plasma d n a for a market product, or would that require a reapproval of that product? Well, I mean, let me just touch on this for for a minute. And it it really very much depends on the application that you're you're looking at. Right? So, you know, if you're using the DNA as a therapeutic product, so if it's a DNA vaccine or it's, you know, embedded within a non viral vector and and the product itself goes directly into the patient, I think that would be quite challenging to replace any DNA source or any ingredient for for from that preparation for for something else.

47:53 So really need early stage work there and and be embedded from from the discovery phase all the way through a commercial product. Now when you're looking at a a d manufacturing and mRNA manufacturing, that's entirely different. You your critical ingredient and the critical ingredients, and and we believe at least that are more readily to be swapped out as they ultimately don't impact on on on on the final product because they're not incorporated to burn the final product. So, you know, in terms of opportunity there in AAV and RNA production in particular, you know, we really see a lot of opportunity to replace plasma DNA and and and in favor of h DNA and o s DNA products. And the second question is, is the company on track to meet its goal of one kilogram of GMP manufacturing capability by year end?

48:42 Will that cover both h b DNA and o s DNA or just h DNA? So I think if we described, we're we're in the process of developing and building out those clean rooms. And with the fair wind, we expect to be there by the end of the year. And those those clean rooms would certainly give us theoretical capacity to do this, whether in practice it's something that we we can or would do is is is a second point because clearly that's about the the the the market demand and where we are in terms of those those customer relationships and what have you. But certainly, we'd have the capacity to to manufacture both HPDNA and and OSDNA. David, hi, Keith. I I might just jump in, obviously, on the basis that I think you've addressed every question that's come in from investors. So thank you so much to investors for submitting those questions and indeed to you both for taking the time to give your responses.

49:35 Thank you once again for updating investors also. Could I please ask investors not to close this session as you'll now be automatically redirected for the opportunity to provide feedback in order the company can better understand your views and expectations. This will only take a few moments to complete, but I'm sure will be greatly valued by the management team. On behalf of management team of Source force 4BASEBIO, I'd like to thank you very much indeed for attending today's presentation. That now concludes today's session. Good morning to you all.