C1, An Ultra-High Yielding, Game Changing Gene Expression ... · 1 Data from market research published by MarketsandMarkets as of May 12, 2017 & Transparency Market Research published

C1, An Ultra-High Yielding, Game Changing Gene Expression Platform

Dyadic (non-conf) BD OverviewFebruary, 2018

Safe Harbor Regarding Forward-Looking Statements

DYADIC INFORMATION 2

Certain statements contained in this presentation are forward-looking statements within the

meaning of the federal securities laws. These forward-looking statements involve risks,

uncertainties and other factors that could cause Dyadic’s actual results, performance or

achievements to be materially different from any future results, performance or achievements

expressed or implied by such forward-looking statements. Any forward-looking statements

speak only as of the date of this presentation and, except as required by law, Dyadic expressly

disclaims any intent or obligation to update or revise any forward-looking statements to reflect

actual results, any changes in expectations or any change in events. Factors that could cause

results to differ materially are discussed in Dyadic’s publicly available filings, including

information set forth under the caption “Risk Factors” in our December 31, 2016 Annual Report

filed with OTC Markets on March 24, 2017. New risks and uncertainties arise from time to time,

and it is impossible for us to predict these events or how they may affect us.

Title and Safe Harbor Regarding Forward-Looking Statements 1

Table of Contents 3

Dyadic Overview 4

C1 Commercially Successful in Industrial Biotech 7

C1 Technology Platform - Where to Play and How to Win 8

Biopharma Industry and Society Challenges 11

C1 Production Host 15

C1 For Biologics 17

C1 Technology Combat Emerging Diseases and Threats 22

Advantages of using C1 for the Development & Production of Biologics and Vaccines 25

Summary 28

Table of Contents


Dyadic Overview


1979 FOUNDED

20+ YEARS EXPERIENCE IN PHARMA / FUNGAL GENE EXPRESSION PLATFORMS

HQ: Jupiter, FL

BD&L: London BD&L: Budapest

R&D: Spain

R&D: Finland

Platform Technology


C1: Fungal Gene Expression Platformfor use in the Development and Production of Biologics

Novel engineered cell line (Myceliopthora thermophila)

>20 Patents

Value & Differentiation:

Decreased Development Time

Lower Production Costs

Improved Biologic Performance

SignificantCapEx Savings

Industrially Proven


Industrial Licensees:

>100 g/l Yield & ~80% Purity Hyper Productive Enzyme Expression

500,000LScale Production

GRAS FDA Certified

Dyadic Leadership Team


M. Emalfarb Founder, CEO

R. Tchelet, PhDVice President, R&D

M. JonesCommercial Officer

T. DubinskiVice President, CFO

Financial Overview


$75MDeal with DuPont for Dyadic’s Industrial Technology Business

>$110M C1 Related License Deals, Milestones & Equity

$19M Share Buyback Completed 2/2017

$5M Add’l Share Buyback Initiated 8/2017

LIQUIDITY

Fully Funded to Execute Business Plan

$51M Cash & Investment Grade Securities (1)

$0Debt

$44M Market CapOTC Markets Stock Exchange(OTCQX: DYAI)

28.7MCommon Shares Outstanding (1)

FINANCIALS

Dyadic Board – Decades of Big Pharma Experience


Arindam Bose, PhD

EXPERIENCE

Dr. Bose worked at Pfizer for 34 years and held leadership roles within bioprocess development and clinical manufacturing and is widely recognized as a Key Thought Leader in the biopharmaceutical industry.

Barry Buckland, PhD

EXPERIENCE

Dr. Buckland worked at Merck for 29 years where he served in a number of senior

R&D leadership roles focusing on fermentation and bioprocess

development and the commercial manufacturing of biologics and is widely recognized as a Key Thought Leader in

the biopharmaceutical industry. Currently, Dr. Buckland is the Executive Director,

NIIMBL (National Institute for Innovation in Manufacturing Biopharmaceuticals) A

public-private consortium dedicated to advancing biopharmaceutical

manufacturing innovation.

Michael P. TarnokChairman

EXPERIENCE

Mr. Tarnok spent the majority of his career at Pfizer and is a seasoned

finance and operational executive with extensive experience in the

pharmaceutical industry. Currently also serves on the Board of the

Global Health Council, and Ionetix, Inc. Prior Board service includes Keryx Biopharmaceuticals, Inc.,

where he also served as Chairman of the Board.

LAST POSITIONVice President, BiotherapeuticsPharmaceutical Sciences, External Affairs and Biosimilar Strategy

LAST POSITIONVice President, Bioprocess R&D, Merck Research Laboratories

LAST POSITIONSenior Vice President in Pfizer’s US Pharmaceutical Division


Dyadic Launch's Biopharmaceutical Strategy for The C1 Gene Expression Platform

Dyadic is Developing What the Industry Refers to As a “CHO stopper”


CHO stopper? Biogen looks to alternative cell lines for future of bioproduction.

The Chinese hamster ovary (CHO) cell line is not the future for biomanufacturingsays Biogen, MIT & Gates Foundation

BioPharma Reporter Bioprocessing survey report, 11/03/2017

“Nearly half the respondents of our second state of the global biomanufacturing survey believe we are too reliant on Chinese Hamster Ovary (CHO) expression systems.”

Dyadic’s Goal To further develop C1 into a safe and efficient gene expression system to help speed up the development, lower production costs and improve the performance of biologic vaccines and drugs at flexible commercial scales.

C1 Technology Platform– Where to Play & How to Win


Biologic drugs make up the fastest growing segment of the pharma industry and are some of the most expensive treatments; therefore, they are placing an enormous financial burden on both patients and the healthcare systems globally.

Total Addressable Market and Market Penetration1

Dyadic is well positioned to penetrate the very attractive biologics market for Drugs and Vaccines, both human and animal health, with its uniquely powerful and proven technology, the C1 Gene Expression Platform.1 Data from market research published by MarketsandMarkets as of May 12, 2017 & Transparency Market Research published on Oct 6, 2016

Global vaccines market projected to be $48.0 billion by 2021

Biologics are the fastest growing segment of the pharmaceutical industry projected to grow at a CGAR of 10.9% over the period 2016 – 2024 to $479.8 billion

$1.3 trillion spent on drugs currently, 18% or $235 billion is for biologics

Industry & Society Challenges


1 Estimated Industry Average CHO Yield for a 12-14 day fermentation run, results vary by company.

0.1 g/l

4 g/lCHO Productivity Appears To Have Plateaued1

1985 1995 2005 2015

Current Industry Solution: Build more expensive manufacturing plants & operate

Industry Problems

Therapeutic protein production is expensive

Involves using enormous quantities of expensive

growth medium

Requires costly manufacturing facilities

Few advances in the protein production process during the past decade, particularly in the area of

CHO cell improvement

Current productivity is not adequate to meet future

commercial manufacturing demand

CHO Technology is Highly Capital Intensive and Costly


Samsung Biologics plants in the Songdo district

in Incheon, South Korea, Cost $740 million

C1 Benefits: Lower Production Costs, Both CAPEX and OPEX


Stainless Steel Multiuse2 x12,000 liter

Single Use Bioreactor2,000 liter

CHO C1Annual Protein Demand in g 800,000 800,000 800,000

Tank size in Liters 12,000 2,000 2,000 Productivity g/l 4 10 15 % Yield 65% 75% 75%Batches per year 20 40 40

Tank Output in g 624,000 600,000 900,000 Tanks Needed 2.0 2.0 1.0 % Capacity Utilized 64% 67% 89%

C1 can lower CAPEX:Smaller facility footprint and related costs

C1 can lower OPEX:• Low cost media• High Yield / Produce at smaller scale


C1 Production Host

C1 – The Science


Unique Morphology

High Purity - 80% of target protein

secreted

Wide operating conditions for

pH and temperature

Shorter Development &

Production Cycle

Translates into better growth conditions

• Higher yields of secreted protein

• Lower viscosity

Greater retention of target secreted protein through downstream processing

Requires only low cost synthetic media

No Viruses which eliminates 2 purification steps typical in CHO

• No Low pH viral inactivation

• No Virus nanofiltration

At scales ranging from laboratory shake flasks to 20,000l tanks and above

C1 has received GRAS (Generally Recognized as Safe) designation from FDA and is considered fit for human consumption

Develop g/l/d C1 cell lines in 15 weeks

From seed flask to fermenter

• Savings of nearly 10 -14 days vs CHO

Fermentation Cycle time 4-7 days

• 1/2 to 1/3rd the time of CHO

High Levels of expression • mAbs > 1.5 g/l/d• Fc-fusion > 1.3 g/l/d

Higher Productivity


C1 for Biologics

High Yield & Purity of C1 Expressed mAb’s


We have expressed 100% of the mAbs & FC-Fusions tested in our 3rd party research collaborations

The mAb genes are integrated specifically to a “Hot spot” in the C1 genome

The mAbs are secreted to the media and are being properly folded

Levels of unoptimized expressed mAb is > 1.5 g/l/d, Fc-fusion > 1.3 g/l/d

The mAb’s are purified using Protein A

The Binding Kinetics of C1 mAb’sare Virtually Identical To mAb’sexpressed from CHO

1

2

3 4

5

6

C1 Advantages Over CHO System


1 2 3

321

Week 1 Week 2 Week 3 Week 4

*Note: Protein Recovery may be faster due to higher purity of C1 production

Batch Cycle time is reduced by >50% in comparison to CHO, freeing up capacity

1: Biomass Expansion 2: Protein Production 3: Protein Recovery*

C1

CHO

Production time reduced by >14 days

Duration of Steps in Production

Faster genetic manipulation (cloning, growth and screening)

Higher stability (monoclonal culture, stable genome)

High expression obtained by site specific integration

No need for induction.

Fast growing culture as yeast

Faster protein production rate – 1.5 g/l/d (more than 10g/l in 7 days

fermentation)

Higher purity of protein achieved may decrease recovery time

No need for virus clearance steps

C1 Advantages for Vaccine Development & Production


Flexibility– The relative simplicity of the production process of C1 enables the production of rVaccines at various scales and at different sites.

Adjuvant effect – Reducing rVaccinesrisk. Preliminary data indicates C1 possess Adjuvant properties. Thus, antigen produced by C1 may not require the addition of artificial Adjuvants.

Immunogenicity – Antigens produced by C1 demonstrated excellent immunogenicity properties: Sanofi Project: The full length rHA from

A/New Caledonia/20/99 (H1N1) strain showed excellent immunogenicity properties in mice without adjuvant

ZAPI Project: C1 produced antigen generated an immune response in mice that protected the mice and did not have negative effects on the health of the mice

Safety – Mice tests demonstrated that recombinant proteins such as HA produced in C1 did not induce any negative clinical signs in mice. No weight loss. No negative clinical signs

during the experiment (visual observations taken each day).

Productivity – C1 is a highly productive strain that can produce rVaccines at very low cost. Example: C1 can potentially produce levels of 1 g/L of HAs against

seasonable Influenza virus(es) in 4 - 7 days fermentation therefore:• In seasonal Influenza Vaccine—total doses distributed = 146M/year• Each 0.5 mL dose is formulated to contain: 15 µg of HA for each

strain.• Thus, 3 X 1000L scale fermentation runs will be able to supply the

annual global HA/strain needs against Influenza of 2,175 g.

ZAPI Project


ZAPI, is a research and development program sponsored by the EU with the goal ofdeveloping a platform suitable for the rapid development and production of vaccines andprotocols to fast-track registration of developed products to combat epidemic Zoonoticdiseases that have the potential to effect the human population.

Three of the initial antigens, each one for a

different virus, was expressed by C1 and

secreted to the medium

To date one of the C1 expressed antigens was tested in a very small mice test within

the ZAPI project. Preliminary results indicated that the C1 produced antigen generated an immune response in mice

that protected the mice, and did not have negative effects on the health of

the mice

We have initiated a C1 development program to express Virus like particles

(VLP) for antigen expressions

C1 Glycoengineering


Glycoengineering of C1 strain will provide the formation of various glycanstructures to evaluate immunogenicity

Man9 Man8 Man7 Man6 Man5 Man3

GF2

High mannose

Core 5-25%

C1 typical Glycan structure

C1 future Glycostructures

Unlike most fungi and yeasts, C1 does not have ‘high’ mannose (branched 30-50 mannose species), but rather has ‘oligo’ mannose and hybrid-type structure.

The native C1 glycan pattern is relatively complex with high mannose type (Man3-Man9) and hybrid type (Man3HexNac-Man8HexNac) glycan forms

So far, O-glycosylation was not identified in therapeutic proteins expressed in C1 but minor level is still possible

Glycoengineeringwork is being

applied to C1 strain to create a strain

that produce proteins with defined human glycoforms

C1 Glycoengineering


Advantage of C1 over Yeast and CHO

Typical Yeast Glycan Structure

Man30-50

Dyadic C1 Glycan Structure

Man3-9

Targeted Mammalian Glycoform structuress

G0 G0F G2 G2F

Dyadic’s C1’s glycan structure is more mammalian like than typical yeast The native C1 glycan pattern is relatively

complex with high mannose type (Man3-Man9)

O-glycosylation was not identified in therapeutic proteins expressed in C1

Less engineering steps needed for C1 Stable genome - defined glycan structure is

stable from culture to culture and batch to batch

The first steps of Glycoengineering C1 cells has begun and were successful

No negative effects on cell viability have been observed with any of the modifications done

C1 mAb’s: Virtually Indistinguishable Binding Kinetics to CHO

25


C1 Technology Combat Emerging Diseases & Threats

Biodefense, Combat Emerging Diseases & Threats


Bioterrorism Agent Categories The “Top Four” Bioterrorist Agents Category A – easily spread, cause

public panic, high death rates-Bacillus anthracis, Clostridium botulinum.

Category B – moderately easy to spread, moderate illness rates and low death risk- Pseudomonas pseudo mallei.

Category C – easily available, easily produced and spread, potential for high mortality rates and major health impact- Lassa virus, Ebola viruses.

Yersini pestis, the bacterium that causes plague.

Variola virus, the virus that causes smallpox.

B. anthracis, the bacterium that causes anthrax.

Botulinum toxin, a protein toxin produced by Clostridium botulinum, the bacterium that causes botulism.


How Can We Combat Bioterrorism?

“Improving nation’s defenses against bioterrorism is a key part of the U.S. government’s homeland security effort.”

– National Institute of Allergy and Infectious Diseases (NIAID).

Biodefense - the procedures involved in taking defensive measures against attacks using biological agents.

Vaccines to immunize the public against bioterror attacks.

• If an attack occurs, treatment in the form of antibodies will be needed.

• Stockpile of drugs and vaccines necessary for emergency cases

• Must be administered before exposure Diagnostic Tests for first responders and medical

personnel to help identify exposure and provide treatment.

Provision of therapy available to infected personnel to help recovery after infection.

IIBR Project


Dyadic has entered into a R & D collaboration with the Israel Institute for Biological Research(“IIBR”) to further advance its C1 expression platform for the development and manufactureof recombinant vaccines and neutralizing agents comprising targeted antigens andmonoclonal antibodies, to combat emerging diseases and threats.

The Israel Institute for Biological Research “IIBR” is a governmental, applied research institutespecializing in the fields of biology, medicinal chemistry and environmental sciences. Backed by fivedecades of experience, IIBR combines highly trained personnel with cutting-edge technologies andinfra-structure to conduct applied research and development in the fields of biology, medicinalchemistry and environmental sciences, in addition to basic research studies closely related to IIBR'sapplied projects.

IIBR's research projects include sponsorships by international authorities and institutions such as the USPublic Health Services, Center for Disease Control, US Army Medical Research and DevelopmentCommand, the World Health Organization, US-Israel Binational Science Foundation, NationalFoundation of Cancer Research and the German Ministry for Scientific Research and Technology.


Advantages of Using C1 for the Development & Production of Biologics and Vaccines

C1 Advantages for Developing & Producing Biologics


Better: High Productivity Protein Expression: 20+ g/l

(Achieved 80 g/l in Industrial application) High Purity Protein Secretion (~80%) Low viscosity Greater Retention of target secreted protein

through downstream processing C1 current developed strain can be used as

production platform for non-glycosylated proteins such as Fabs, bi-specifics and new drugs

Glycoengineering work is being applied to the host production C1 strain to allow for production of proteins with human defined glycoforms such as mAbs, Fc-fusions and recombinant vaccines

Glycoengineering work in C1 requires less steps than yeast

• Easier starting put since C1 doesn’t have hyper mannose structure

• No O-glycosylation

Easier: Advanced Genetic Tool

Box Site specific integration vs.

random integration Wide operating conditions

for pH and temperature Simple C1 production

process allows for production of biologics at various scales and at different sites

Faster: Develop high yield g/l/d C1 cell lines in 15 weeks Fed batch technology – no need for perfusion No Viruses eliminates the need for two

additional purification steps 4-7 days Fermentation time (1/2 to 1/3rd less

time than CHO) Cell Reproduction rate (2x greater than CHO) Initial protein production rate ~1.5x greater than

CHO and expected to increase further

Lower Cost: Defined, low-cost media

based on glucose No Viruses eliminates

associated costs

42

118 124

60110

360

050

100150200250300350400

C1 - 2,000L tank C1 - 10,000L tank CHO - 10,000L tank

Cos

t in

Mill

ion

USD

Lower Manufacturing Cost: C1 vs CHOHumira mAb

Annual OpEx

Initial CapEx Investment

Summary


Shorter development & production cycles

Higherprotein yields

Lower CapEx/OpEx

Higher purity & greater protein recovered

Low Cost Media / No Viral Inactivation

No negative clinical signs in mice studies

R&D Collaborations Licensing Arrangements

Other Commercial Opportunities

Dyadic is looking for partners in the biopharmaceutical space to exploit the potential of C1. Contact [email protected]

THANK YOU!

Documents

C1, An Ultra-High Yielding, Game Changing Gene Expression ... · 1 Data from market research published by MarketsandMarkets as of May 12, 2017 & Transparency Market Research published