an ultra-high yielding, game changing gene expression …...other funded proof of concept research...

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

C1 UpdateJuly 23, 2018

DYADIC INFORMATION

Safe Harbor Regarding Forward-Looking Statements

Certain statements contained in this presentation are forward-looking statements within the meaning of the federal securitieslaws. These forward-looking statements involve risks,uncertainties and other factors that could cause Dyadic’s actualresults, performance or achievements to be materially differentfrom any future results, performance or achievements expressedor implied by such forward-looking statements. Any forward-looking statements speak only as of the date of this presentationand, except as required by law, Dyadic expressly disclaims anyintent or obligation to update or revise any forward-lookingstatements to reflect actual results, any changes in expectationsor any change in events. Factors that could cause results to differmaterially are discussed in Dyadic’s publicly available filings,including information set forth under the caption “Risk Factors” inour December 31, 2017 Annual Report filed with OTC Markets onMarch 15, 2018. New risks and uncertainties arise from time totime, and it is impossible for us to predict these events or howthey may affect us.

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DYADIC INFORMATION

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 biomanufacturing says Biogen, MIT & Gates Foundation

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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.”

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.

Dyadic’sGoal

Gottlieb Slams Pharma, Launches Biosimilar Pathway, 7/19/2018

“Less than two percent of Americans use biologics, but they account for 40 percent of total spending on prescription drugs. They also represent 70 percent of the growth in drug spending from 2010 to 2015 and are expected to be the fastest growing segment of drug spending.”

https://www.biospace.com/article/gottlieb-slams-pharma-launches-biosimilars-pathway/

Dyadic Overview

DYADIC INFORMATION 4

1979 FOUNDED

20+ YEARS EXPERIENCE IN PHARMA / FUNGAL GENE EXPRESSION PLATFORMS

HQ: Jupiter, FL

BD&L: London R&D Management: Budapest

R&D: Valladolid

R&D: Helsinki

DYADIC INFORMATION

Platform TechnologyC1: Fungal Gene

Expression Platformfor use in the Development and

Production of Biologics

HQ: Jupiter, FL

BD&L: London &Budapest

R&D: Finland& Spain

1979 FOUNDED

Value & Differentiation:Decreased

Development TimeLower

Production CostsImproved

Biologic Performance

>20 Patents

Novel engineered cell line (Myceliopthora thermophila)

20+ YEARS EXPERIENCE IN PHARMA / FUNGAL GENE EXPRESSION PLATFORMS

GRAS FDA Certified

500,000LScale Production

>100 g/l Yield &~80% Purity

Hyper Productive Enzyme Expression

Industrial Licensees:DuPont, BASF, Abengoa, CODEXIS, Shell etc.

Dyadic Overview

Industrially Proven

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DYADIC INFORMATION

Dyadic Leadership Team & Financial Overview

Leadership Team Financials

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

>$110MC1 Related License Deals, Milestones & Equity

$47.7M Cash & Investment Grade Securities (1)

$0Debt

M. Emalfarb Founder, CEO

$41.8M Market CapOTC Markets Stock Exchange(OTCQX: DYAI)

$19M Share Buyback Completed 2/2017

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

R. Tchelet, PhDVice President, R&D

M. JonesCommercial Officer 28.1M

Common Shares Outstanding (1)

P. RawsonCAO

6(1) As of March 31, 2018

Liquidity

Fully Funded to Execute Business Plan

DYADIC INFORMATION

Dyadic Board – Decades of Big Pharma Experience

Senior Vice President in Pfizer’s US Pharmaceutical Division.

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 biopharma industry.

Arindam Bose

Mr. Tarnok is a seasoned finance and operational executive with extensive pharmaceutical industry experience. Currently serves on the Board of the Global Health Council, and Ionetix, Inc. Prior Board service includes Keryx Biopharmaceuticals, where he also served as Chairman of the Board.

Michael TarnokChairman

Vice-President, Biotherapeutics Pharmaceutical Sciences, External Affairs and Biosimilar Strategy

Last Position

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Barry Buckland Vice President, Bioprocess R&D, Merck Research Laboratories

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 biopharma industry. Currently serves as Executive Director of NIIMBL (National Institute for Innovation in Manufacturing Biopharmaceuticals).

ExperienceBoard of Directors

DYADIC INFORMATION

Certain Research Collaborations

Reinventing biological vaccine and drug development & productionDYADIC®

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DYADIC INFORMATION

On-going Research Programs and Collaborations

Mitsubishi Tanabe Pharma

To help Mitsubishi Tanabe overcome specific gene expression challenges of two important therapeutic compounds using C1 technology.

Israel Institute for Biological Research (IIBR)

To further advance C1 for the development and manufacture of recombinant vaccines and neutralizing agents comprising targeted antigens and monoclonal antibodies to combat emerging disease and threats.

Other funded proof of concept research collaborations

To explore the potential of C1 technology to produce active moiety. To test the feasibility of C1 technology to produce seven different molecular biology

enzymes for pharmaceutical use.

In different stages of discussion with potential collaborators

Human Applications Animal Health Applications

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DYADIC INFORMATION

C1 Production Host


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DYADIC INFORMATION

CHO C1 White Strain 2.0

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

Temperature

40ºC37ºC

-32ºC25ºC

CHO

3

45ºC-

25ºC

C1

71 14

5 8CHOC1

pH1 7

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C1 Strain Development for Therapeutic Protein

LC strainLow backgroundHigh proteolytic

HC strainHigh BackgroundHigh proteolytic

0.1 g/L

1.0 g/L

2.0 g/L

10 g/L

15 g/L

? g/L

DNL103 - DNL115Lower backgroundLower proteolytic

DNL120 -Low backgroundLow proteolytic

2016 2017 2018 2019 2020

DNL ?Low backgroundLow proteolytic

7 daysfermentation

(80 g/l enzyme for Bioindustrials application)

(120 g/l cellulosic enzyme for Biofuel)

From BioIndustrial application to Biologics

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New C1 strains for biologics

Glycoengineering


DYADIC INFORMATION

Proteolytic Activity

High Low

Proteolytic Activity

High Low

0 g/L 20 g/L

Basic Therapeutic Protein Productivity

0 g/L 20 g/L

Basic Therapeutic Protein Productivity

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• Current Production Strain

• Target C1 Production Strain

• Continuing to Optimize Yield, Stability, Glycan Structure & Purity Changing the

cellular regulatory circuit

Libraries of Efficient & Strong

Promoters

Libraries of TF and signal peptides and / or carrier proteins

Libraries of protease deletion

strains

Glycoengineering to form mammalian-like

glycan structures

As Good As C1 Currently Is, We’re Making C1 Better Every Day!

Protein Purity

DYADIC INFORMATION

C1 for Biologics


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Success in MAbX Expressions by C1

Fermentations carried out for mAbX production with vessel volumes, culture volumes, and antibody titres.

SDS gel analysis of the mAbX antibody purified from the fermentations by protein A affinity chromatography: A. Fermentation MT107 in a 10 litre vessel, B. Fermentations MT111-113 in a 1 litre vessel. Input depicts the sample loaded to the protein A column, fr3-fr7 are the elution fractions obtained from the chromatography. Samples of CHO-produced mAbX are shown as controls.


C1 Expression Technology

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mAbY production titer (g/L Specific mAbY production (g/g total protein)

+ 50%X 2.3-fold

Medium plus feeding improvement lead to a mAbY titer of 9 g/L at 90 h, and increase in specific productivity

Summary

2.4 g/l/d


DYADIC INFORMATION

A certain Mab for which the ligand was commercially available was produced in CHO (control Mab) and C1 (C1-produed mAb)

The binding properties of the mAbs to the ligand were compared in a Biacore T200 assay

The control mAb and C1-produced mAb showed virtually indistinguishable binding kinetics.

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• The Binding Kinetics of C1 and CHO produced mAbs appear near identical

C1 mAb’s: Virtually Indistinguishable Binding Kinetics to CHO

Successful expression of Fc-Fusion protein

C1 expressing Fc-Fusion was cultivated in 1 litre fermentors at 38oC and theproduct was analysed by Western Blotting

The protein A purification yield from day 6 was 8.1 g/l, corresponding to 1.35g/l/day production rate.

The fermentation was not fully optimized

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Success In Fc-Fusion Expressions by C1

DYADIC INFORMATIONDYADIC INFORMATION 18

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Success In Bispecific Expression

In a few months work we have been able to express a bispecificantibody using C1 and provide sufficient quantities of this antibody toour collaborator which they were not able to do previously using otherexpression systems after two years of work.

DYADIC INFORMATION 19DYADIC INFORMATION

Products Development for Biosimilars Market


(*) GlobalData 2017

(*)

On Going

0.3 g/L (114 h)0.063 g/L/d

1.1 g/L (139 h)0.18 g/l/d (**)

0.1 g/L (112 h)0.021 g/L/d

2.1 g/L (112 h)0.45 g/L/d

7.5 g/L (112 h)1.6 g/L/d

0.6 g/L (116 h)0.12 g/L/d

On Going

(**) Fermentation in 1L scale

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Success In Certolizumab Expression

Successful expression of Certolizumab

ELISA kit was used to measure and conform Certolizumab expression level (triplicatesof samples were quantified)

The calculated expression level was 9.12 g/l, corresponding to 1.9 g/l/day productionrate.

This strain was created using the bgl promoter. By using the Synthetic Promoter andoptimized fermentation process we would expect to see similar, if not higher,expression levels as we saw with our best mAbY.


DYADIC INFORMATION

C1 for Recombinant Vaccines


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DYADIC INFORMATION

Agglutination test

Influenza strain Expression Bioactive HA

New Caledonia, A (H1N1) Yes Yes

Texas, A (H1N1) Yes Yes

Puerto Rico A (H1N1) Yes Yes

California, A (H1N1) Yes Yes

Florida B Yes Yes

C1, Ability to Express Biologically active HA’s

The Expression of 5 Recombinant HA’s by C1

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DYADIC INFORMATION

830

453

104108

HA - C1

1 3.33 10 30

HI t

iter

agai

nst

Infl

uenz

a vi

rus 1000

100

10

530 30 0

C1Mock1

C1Mock1 PBS

Negative control

μg HA μg HA

HA-C1 Excellent Immunogenic Properties

The full length rHA from A/New Caledonia/20/99 (H1N1) strain showed excellent immunogenicity properties in mice without adjuvant

Excellent Immunogenicity from C1 Expressed HA

Mice study was conducted by Sanofi-Pasteur

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Immunogenicity Evaluation of C1 HA/New Caledonia

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1.0 μg 3.33 μg 10 μg 30 μg

Dose (μg HA)

Dose Response D49

3.0

2.5

2.0

1.5

1.0

0

0

0

0

+

+

+

+

+

0

0

0

+

+

+

0+

0

0+

+

+

0+

+

0

0

0

+

+

+

+

Antibody response measured by Hemaglutination Inhibition response after 2 Intra Muscular injections in Mice:

DYADIC INFORMATION

HA

tite

r –

D49

(lo

g10)

830

453

104108

HA - C1

1 3.33 10 30

HI t

itera

gain

stIn

fluen

za v

irus

1000

100

10

530 30 0

C1Mock1

C1Mock1

PBS

Negative control

μg HA μg HA

HA-C1 Excellent Immunogenic Properties

1μg 3.33μg 10μg 30μg

50% (4/8)

57.1% (4/7) 100% (8/8) 100%

(8/8)

C1 HA Dose Groups

DYADIC INFORMATION

DYADIC INFORMATION

Additional C1 HA Data from Mice Study Conducted by Sanofi-Pasteur

The full length recombinant 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).

The full length of HA/New Caledonia produced in C1 showed excellent immunogenic properties in mice.

C1 can potentially produce levels of 1 g/L of HAs and other antigens 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.

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DYADIC INFORMATION

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.

GOAL

Three of the initial antigens, each one for a different virus, wasexpressed by C1 and secreted to the medium

To date one of the C1 expressed antigens was tested in a very smallmice test within the ZAPI project. Preliminary results indicated thatthe C1 produced antigen generated an immune response in micethat protected the mice, and did not have negative effects on thehealth of the mice

We have initiated a C1 development program to express Virus likeparticles (VLP) for antigen expressions

Nano-particleExpression molecule

BRUNE KD et al., Bioconjug Chem. 2017

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DYADIC INFORMATION

Antigen Production With Synthetic Promoter

Production level of Antigen ~350 mg/L (1 L scale fermentation with bgl promoter)

SES construct was transformed in two 8x protease deletion strains transformants were cultivated in 24-well MTP with the addition of protease inhibitors.

SES clones with several fold increase in production (compared to bgl) were identified

The New strain using SESpromoter system significantlyincreased the production andstability of the target antigenwhen 723 mg/L was reached in94 hrs.

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VP2 protein is a structuralprotein of the InfectiousBursitis virus (IBDV;Gumboro) what naturallyautoassemble forming VirusLike Particles

Translation

Assembling process

x60

VLPs

VP2protein

VP2 gene

Ch-VLP platformTechnology basis

(+34) 983 54 85 63

[email protected]

C/ Louis Proust, 13 47151 Boecillo (Valladolid) - Spain

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VLP Productivity in C1 at 30L Scale

VLP is expressed into DNL121 under bgl promoter.

Extracelular-VLP

Intracelular-VLP

Productivity reaches 300mg/L

Intracellular remains around 70mg/L


Visualization of VLPs Produced by C1

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VLP produced by C1 Control

• Extracellular VLPs produced by C1 are perfectly conformed. The structure is homogeneous in size and aspect.• The production level of the extracellular VLP produced by C1 was 300 mg/L.• The production level of the intracellular remained VLP produced by C1 was 70 mg/L• In comparison, extracellular fraction couldn’t be produced by S. cerevisiae. • Intracellular VLP produced by S. cerevisiae reached a level of 70 mg/L

Intracellular and extracellular fractions of SP-VLP have been visualized by Transmission Electronic Microscopy (TEM)

DYADIC INFORMATION

Extracellular fraction

Intracellular fraction S. cerevisiae

300mg/L (112,5H) 70mg/L (112,5H) 70mg/L

DYADIC INFORMATION

Glycoengineering


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DYADIC INFORMATION

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

C1 typical Glycan structure

C1 Glycoengineering

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

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

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

C1 future Glycostructures

Glycoengineering work is being applied to C1strain to create a strain that produce proteinswith defined human glycoforms

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DYADIC INFORMATION

C1 Glycoengineering In Progress

Dyadic’s C1’s glycan structure is moremammalian like than typical yeast

o The native C1 glycan pattern isrelatively complex with highmannose type (Man3-Man9)

o O-glycosylation was not identified intherapeutic proteins expressed in C1

o Less engineering steps needed for C1

The first steps of Glycoengineering C1cells has begun and were successful

No negative effects on cell viability havebeen observed with any of themodifications done

Dyadic C1 Glycan Structure

Typical Yeast Glycan Structure

Man9

Targeted Mammalian Glycoforms

G0 G0F G2 G2F

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Glycoengineering C1 Strains

Improving the glycoform structure in C1 Glycoengineered strains:

Proteodynamics (France) analysed glycans from native protein samples of glycoengineered C1 strains (indicated) by permethylation + MALDI-TOF analysiso No fungal high mannose structures presento Up to 80% of Man3 structure, the important precursor for human glycoforms

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


DYADIC INFORMATION

Robust & Versatile Bio-Manufacturing


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DYADIC INFORMATION

C1 Benefits: Lower Production Costs, Both CAPEX and OPEX

2,000 liter2 x12,000 liter

C1 can lower CAPEX:• Produce at smaller

scale while dramatically increasing protein yields

C1 can lower OPEX• Smaller facility

footprint and related costs

• Low cost media

Single Use BioreactorStainless Steel Multiuse

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 3 10 15 % Yield 65% 75% 75%Batches per year 20 40 40 Tank Output in g 468,000 600,000 900,000 Tanks Needed 2.0 2.0 1.0 % Capacity Utilized 85% 67% 89%

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DYADIC INFORMATION

Dyadic is looking for partners in the biopharmaceutical space to exploit the potential of C1.

Ongoing Internal & Third Party Research Programs:

Optimizing Yield, Stability, Glycan Structure, Other Properties & Purity

Higherprotein yields

Lower CapEx/OpEx

Higher purity & greater protein

recovered

Low Cost Media / No

Viral Inactivation

No negative clinical signs

in mice studies

Shorter development & production

cycles

Summary

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R&D Collaborations Licensing Arrangements

Other Commercial Opportunities

C1 Advantages

THANK YOU!

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an ultra-high yielding, game changing gene expression …...other funded proof of concept research...

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