Recursion Pharmaceuticals Q1 2025 Earnings Report

Recursion Pharmaceuticals EPS Results

• Actual EPS: -$0.50
• Consensus EPS: -$0.44
• Beat/Miss: Missed by -$0.06
• One Year Ago EPS: -$0.39

Recursion Pharmaceuticals Revenue Results

• Actual Revenue: $14.75 million
• Expected Revenue: $18.12 million
• Beat/Miss: Missed by -$3.37 million
• YoY Revenue Growth: +7.20%

Recursion Pharmaceuticals Announcement Details

• Quarter: Q1 2025
• Date: 5/5/2025
• Time: Before Market Opens
• Conference Call Date: Monday, May 5, 2025
• Conference Call Time: 8:00AM ET

Recursion Pharmaceuticals (NASDAQ:RXRX) is a biotechnology company that applies advanced machine learning, automation and high‐throughput biology to accelerate the discovery and development of new medicines. Headquartered in Salt Lake City, Utah, the company has built a proprietary platform that integrates imaging-based cellular assays with artificial intelligence to analyze disease models at an unprecedented scale. By combining experimental biology and deep data, Recursion aims to identify novel therapeutic opportunities faster than traditional approaches, focusing on areas of high unmet medical need.

Founded in 2013 by a team of researchers and technologists, Recursion has expanded its operations to include multiple laboratory facilities and computational centers in the United States and select international sites. Its internal pipeline spans a diverse range of therapeutic areas, including rare genetic disorders, immunology and oncology. The company leverages its extensive compound libraries and phenotype-driven screens to prioritize and advance lead candidates into preclinical development, with the goal of delivering first‐in‐class or best‐in‐class therapies.

Recursion maintains strategic collaborations and partnerships with leading pharmaceutical and biotechnology firms to co-develop novel drug candidates. These alliances provide access to additional resources, proprietary targets and global development expertise, enabling Recursion to augment its internal capabilities and accelerate timelines. The company’s platform has been applied to both small-molecule and biologics discovery projects, demonstrating its flexibility across multiple molecular modalities.

Leadership at Recursion includes Chief Executive Officer Blake W. Borgeson and Chief Scientific Officer Chris Gibson, among others with deep experience in technology, data science and drug development. The management team emphasizes a data-centric culture and continuous innovation, investing heavily in research infrastructure and cross-functional talent. Through its unique integration of biology and computation, Recursion aims to reshape the pharmaceutical R&D paradigm and bring transformative treatments to patients worldwide.

Recursion Pharmaceuticals Q1 2025 Earnings Call Transcript

Key Takeaways

• Recursion OS 2.0: Post-combination with Exscientia, the company’s multimodal platform integrates phenomics, transcriptomics, AI-driven design, and lab automation to accelerate drug discovery and improve efficiency.
• Sharpened pipeline: Recursion is advancing five high-priority internal programs (including CDK7, RBM39, MALT1, PI3Kα mutant-selective, and FAP) while reallocating resources from less differentiated assets.
• Program cuts: The company discontinued NF2, CCM, and C. difficile clinical programs and placed the LSD1 inhibitor on strategic pause after failing to meet efficacy or differentiation thresholds.
• Strong financial runway: With $509 million in cash, a targeted 2025 cash burn of ≤ $450 million, and $450 million+ in collaboration revenues to date, Recursion expects funding into mid-2027.
• Encouraging early data: CDK7 inhibitor REC617 showed a confirmed partial response in platinum-resistant ovarian cancer and FAP inhibitor REC4881 delivered a 43 % median polyp burden reduction with manageable safety, with combination and expanded data readouts planned in H2 2025.

Presentation

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

Hi, everybody. My name is Chris Gibson, cofounder and CEO of Recursion, and I'm delighted to welcome you to our learnings call this morning. We're gonna go ahead and get started. Perfect. So, of course, important to note that we're gonna be providing forward looking information today, so please understand all of these important caveats.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

So I wanna begin by just talking a little bit about Recursion's mission, which is to decode biology to radically improve lives. And unlike a traditional biotech where learnings from a program typically work within that specific program, those learnings could improve a program, or the scientists from a given program might take some of those learnings onto their next program. At recursion, we're trying to do something different. We're trying to build a learning system, a recursion operating system that learns from every program to make the next generation of programs better and better, and that requires some scale. And what you're gonna see today is that we're taking decisive action to make sure that we can continue to both take our internal pipeline forward, our partnerships forward, and also that we can continue to run this critical experiment for the biopharma industry, and that is to build the first great tech bio company.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

I wanna talk a little bit about our earliest version of the platform, Recursion 0.1. This was a platform built on top of phenomics and siRNA and repurposing. And today, you'll hear a bit about how some of those programs have done well, like our FAP program with preliminary efficacy data and safety data we'll share soon, and also how some of those programs have not turned out the way we hoped, such as our CCM program. But building on the learnings of that first generation, we built an improved recursion operating system, recursion one point o, that added transcriptomics that allowed us to go after new chemical entities and use advanced tools like CRISPR. And that's allowed us to take forward incredible programs like our RBM thirty nine program and our C.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

Diff program. Some of these programs advancing and others were holding back for strategic reasons today. And ultimately, Recursion two point o is what we are now. Post the combination with Exensia, we've seen the power of combining our two platforms, the multimodal data, the compute, and the active design. These are allowing us to generate a new generation of early stage discovery programs that we think are extraordinarily exciting.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

And all of this work is enabling us to demonstrate these leading indicators of success. We're able to validate our hypotheses more quickly. We're able to generate candidates with fewer molecules synthesize. We can spend less and go faster. And through each generation of Recursion's operating system, we expect to improve on these kinds of parameters.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

And today, we're sharpening our focus, sharpening our R and D portfolio because we committed to doing that with the combination of Recursion and Exensia, two of the leading tech bio companies, because we've seen the power of our Recursion OS two point o platform, and we wanna make sure we can double down on the winners and also make sure that we're the kind of company that can decisively move away from programs that don't meet our MAR. Finally, we understand the challenging macroeconomic environment, and we want to be absolutely sure that in this kind of uncertain environment, we're making disciplined and thoughtful decisions to ensure that we can deliver on our long term mission to decode biology to radically improve lives. So today, we're unveiling our go forward pipeline, more than five clinical and preclinical programs that we believe have a much higher probability of success. We believe these are programs that are worth taking the shot, and we're doubling down on them. And we're gonna hear a lot more about each of these a little bit later today.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

But before we do, I wanna also share that it's not just about our internal pipeline. It's also about our partnerships. We brought in more than $450,000,000 earned through these four collaborations to date. Today, we're also sharing that we've received our fourth program option from Sanofi, part of that collaboration. And I believe that through our continued work on programs like those that we're advancing with RocheGenentech and with Sanofi, Recursion is not only going to continue building its Recursion operating system, it's going to continue learning to improve not only our internal pipeline, but all of the partnership programs that we advance together in the future.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

So with that, I want to turn it over to our Chief R and D Officer and Chief Commercial Officer, Najat Khan. And I just want to say a huge thanks to her and the team that's done incredible work to help us make these important decisions for the future of the company. With that, over to you, Najat.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Thank you, Chris. Good morning, good afternoon, good evening, everyone. Thank you so much for joining our Q1 twenty twenty five earnings call. As Chris mentioned, over the next forty minutes or so, I'll walk through some of the key pipeline updates, delivering on our commitment to sharpen our focus following the combination of Excientia. I'll also highlight the programs we're advancing with the potential for greatest impact and also programs that we have thoughtfully chosen to discontinue.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

And in addition to that, I'll round it out. So we go back to the next prior slide. You know, Chris shared this slide. I just wanna double down on a few more points. So first of all, you know, three key points to consider.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

One is our pipeline really reflects the strategic application of Recursion OS and AI, where it matters the most. So as I go through each of these programs, I'll talk about places where we have novel biological insight or areas where we are engineering and designing differentiated molecules, as well as areas that we're driving precision based development, a really key theme that we're doubling down on further. But every single asset you see on this page is done with one end in mind, which is programs that aim to create differentiated medicines that patients are waiting for. The second point, in terms of sharpening our focus, we're doubling down in these programs, both in oncology and complementing it with a focused effort in rare diseases. As Chris mentioned, we're advancing over five internally developed programs with first or best in class potential, each targeting unmet needs with a clear and efficient path to development and potential launch.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

And then the third point, look, as part of having portfolio, since we did the integration, the portfolio has grown, and we said that we would actually make disciplined decisions to sharpen our focus. This is based on both data, and I'll talk through that, but also strategic considerations. It includes deprioritizing three programs, NF2, CCM and C. Diff. We're also placing LSD on a strategic pause as we assess opportunities for a more differentiated TPP.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

And we've also made some choices in our preclinical programs, a balanced approach both pre clinically and research and also in development. You will see through the presentations that this move and these moves reflect our clear commitment to a high bar on differentiated medicine following the special combination, while also contributing to capital efficiency by reallocating these precious resources towards the highest potential opportunities. Slide. So let's start with some of the go forward programs from the prior slide. I'm going to go through further details, but I just want to hit a few key points as a summary.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

So CDK7, starting with our selective and reversible CDK7 inhibitor, REC617 was precision designed using our Recursion two point zero platform with a remarkable 136 novel compounds synthesized, compared to thousands that are typically made. It was designed to optimize that therapeutic index with the goal to improve safety and efficacy compared to our competitor molecules. Early clinical data, which we shared in December from our monotherapy shows there's encouraging monotherapy activity, including a partial confirmed partial response in a platinum resistant ovarian cancer patient, and so far a manageable safety profile. As we committed to before, we will open combination studies in first half of twenty twenty five and further details about that will be announced upon study initiation. Now turning to our potential first in class RBM molecular group degrader REC1245.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

This emerged from our phenotypic insight that revealed RBM39 as a potential novel mechanism that is functionally linked from our phenotypic platform to CDK 12, a historically challenging oncology target. By degrading RBM 39, Rec one two four five is designed to potentially move the downstream effects of CDK12 inhibition, disrupting RNA splicing to down regulate cell cycle checkpoints, DDR networks, etcetera. This triggers cell stress and apoptosis. We advanced this program from target ID to IND enabling in less than eighteen months, showcasing the speed and precision of our learning discovery and Recursion two point zero platform. The clinical development program, as we noted earlier, is focused on a biomarker defined set of solid tumors and select lymphomas, with preclinical studies supporting its PKPD relationship and antitumor activity.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

The study is now in monotherapy dose escalation. Turning to the next one, MALT1. This is our selective best in class MALT1 inhibitor, which recently entered phase one dose escalation last quarter with the first patient now dosed. REC3565 is being developed for relapsed refractory B cell malignancies. Again, another example of a molecule that was designed by a Recursion two point o platform, especially the generative AI piece, which integrated hotspot analysis and molecular dynamics to enable best in class profile with improved potency selectivity and safety.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

And one piece I wanna point out is that the molecule was designed to avoid meaningful inhibition of UGT one zero one, a known off target liability seen in this class of molecules that can drive hyperbilirubinemia. Next PI3K. This is our most advanced, one of our most advanced preclinical programs. It's a PI3K alpha inhibitor designed to highly selectively target the H1047R mutation, which is a driver alteration present in about fourteen percent of breast cancers and four percent of all cancers. While PI3K, of course, is a crowded landscape, this molecule was again developed using our generative AI platform to optimize selectivity from the mutant as well as over wild type.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

So about a hundred x more selectivity over wild type and 10 x greater selectivity from some of the wild type sparing inhibitors that you've seen recently. And to date, in our preclinical models has not shown any sign of hyperglycemia or GI tox. Early preclinical data is something I'll share in greater detail today that is showing to regressions at low doses, supporting a potential therapeutic window, a broader therapeutic window that limits liabilities such as hyperglycemia, with the goal to also improve the potential for efficacy. Next, I'll move to some of our targeted rare disease programs, FAP. So FAP, this is an allosteric MET one two inhibitor in development for the orphan disease FAP.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Just as a reminder, there are no approved therapies and the unmet need is very high. This is a potential first in disease program that originated, as Chris mentioned, from the earliest iterations of the Recursion OS platform, showing an unexpected and novel insight between MEK and APC and FAP disease modulation. 04/1981 is currently an ongoing phase two open label signal seeking study. As you know, some of the initial data including safety, tolerability and preliminary efficacy of REG four thousand eight hundred eighty one in four milligram was presented yesterday by our investigator, Doctor. Joel Samadar, in in a late breaking podium session at the DDW conference in San Diego.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

I'll walk through some of the similar data to share with you in terms of the pipeline update, as well as the next steps for the program. EMPV one, moving to our second program in rare diseases, REV102 is a orally bioavailable small molecule EMP1 inhibitor being developed jointly with Rally Bio for hypophosphatation, which is a rare metabolic bone disease. I'll leave some of the details, but I'll share more in terms of our how we have leveraged our platform in designing a highly selective ENPV1 inhibitor, potential first and best in class, and also some of the preclinical data that we have seen recently for this compound. And LSD1 lastly, as noted earlier, we're strategically pausing development, a potential best in class CNS penetrant reversible LSD1 inhibitor to ensure some of the internal and external data that would be important to have a competitive TPP. We may pick this program up later depending on how some of this data evolves.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Now moving to some of the programs that we are deprioritizing. So let's start with NF2. After a thorough review of the clinical data by the NF2 team, we believe that the decision to discontinue further development is clear. Although phase two for NF2 related meningiomas technically passed the futility threshold, and this is what we were waiting for, it was primarily driven by the lower forty milligram cohort, the sixty milligram and the combined dose arms did not pass the futility criteria. And the point I want to emphasize the most is we observed limited tumor shrinkage and clinical activity across both forty sixty milligram arms.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

The next program CCM. For CCM, we initially reported top line data from the Phase II Sigmar trial, and we were pleased to see that it was safe and well tolerated. While the early data did show some promising trends potentially in exploratory efficacy endpoints at 400. This was both for lesion volume and the Rankin score. There were negative trends in the efficacy of two hundred, but these signals and data were not statistically significant.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

One of the things we noted in terms of next steps was looking into the LTE as well as additional regulatory engagement. So what are the new findings? From the long term extension studies, we do not see promising trends in MRI, a decline or functional outcomes. And I wanna emphasize a couple of things. One that we were paying attention to is placebo to four hundred milligram crossover, where each patient served as their own baseline.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

We did not see any trends there across any of the endpoints. And for four hundred milligram to four hundred milligram arm, we did not see the continuation of prior trends. And further, it was not distinguishable from natural history. So unfortunately, on the totality of the data, and this was important to actually have an LTE for a first in disease program to give us confidence, we looked at the totality of the data and it supports the discontinuation of the CCM program. And now turning to C.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Diff. From a platform perspective, we saw novel insight. This is a new mechanism of action in terms of how we can tackle recurrent C. Diff, a highly potent and orally viable C. Diff toxin, selective inhibitor.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

However, as with any of these programs, we're constantly tracking the external landscape. And the recurrent rate, aka the unmet need of C. Diff with some of these programs that are further along is now reducing to almost around five percent. And without a clear differentiation, this comes to the point we made earlier. Without a clear differentiation profile, we've decided not to pursue further development, internal development, and take those precious dollars to double down on areas where we have scientific, commercial, and technical promise.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

So I just wanna round by saying per our clinical trial transparency policy, we intend to make all clinical data publicly available in a peer reviewed journal following appropriate review. And a huge, huge thank you to all of the investigators and patients for supporting us, for being part of the studies. Research and development is one of the hardest things we do to make new medicines for patients. And it's with deep gratitude. Thank you for being part of our journey.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

So I just wanna take a moment. You know, we talked about go forward programs. We talked about programs from where we where we are making data driven and strategic decisions. What is that go forward portfolio strategy as a learning organization? It has to be grounded in scientific river river and disciplined capital allocation.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

This reflects a raised bar for what we choose to pursue. Programs that meet the highest standards of differentiation, address significant unmet need, and leverage the unique strength and the full power of the Recursion two point o platform. So as you can see, we will we are evolving to a more focused product oriented strategy leveraging the full power of the Recursion two point o platform. And that tech stack is not just biology, not just chemistry, but also in clinical. And I speak to that more as we go through some of the programs.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Number two, we're focusing and we'll continue to focus on medicines for patients that are differentiated at the time of launch. Those can be first in class. Those can be best in class. And third, the how. We are applying disciplined execution through rapid, data driven, and resource efficient, go no go decisions.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

In house AI driven design, really important, and clear differentiated target product profiles to accelerate our proof of concept and maximize R and D resource and time efficiency. So with that disciplined framework, what comes next? Let's go to the catalyst slides. We anticipate meaningful readouts and catalysts across our internal pipeline in 2025 and 2026. So the first half, as I mentioned earlier, the initiation of our combination study in advanced tumors, building on the monotherapy insights from December of last year for CDK7.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Second half of this year, we will have additional Phase one data from the monotherapy as that program matures in the second half for CDK7. In addition, for FAP, we also have additional patients enrolling in a four milligram cohort. So we'll have additional data as well. And as I mentioned with PI3K, we expect development candidate nomination in the second half of this year, so we can start the all important IND enabling studies for this important program. Transitioning to next year, so first half of twenty twenty six, which is the early safety and PK data readout from our ongoing monotherapy trial in biomarker enriched, our BM39 program for solid tumors.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

And in the second half, similarly early safety and PK update for monotherapy for our MOD1 study in B cell malignancies, as well as Phase one initiation for our ENPD1 inhibitor and hypophosphatation. So that was the overall view of the portfolio. What I'd like to do now is go through some deep dives for FAP, for PI3K and ENPP1. I'll also ensure that you have a one pager latest and greatest update on all of the other programs, clinical and preclinical, and then I'll round it out with some of our latest updates on partnerships. Alright.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

FAP. Next slide, please. Lots of words. I'm not gonna go through all the words on the slides, but I think the most important elements are this is an allosteric MEK one two inhibitor developed for FAP. FAP is a rare inherited condition with no FDA approved therapies.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Next slide. We leveraged how did we leverage the Recursion OS platform? You know, we analyzed cellular models of APC gene loss, which is the root cause of FAP, and we identified MET one two inhibition as a novel therapeutic intervention of this mutation. This insight drove the discovery of Rec four eighty one, which is a molecule that we in licensed. And next step was to see, did this insight, which was unknown before, play out preclinical?

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Next slide. So in preclinical models, Rec four eighty one demonstrated significant reductions in both polyp count and high grade adenomas, outperforming celecoxib, which is one of the off label drugs that are used today and not approved today. In addition to that, we then decided to go into clinical studies. If we go to the next slide, please. The trial is a two part study, evaluating REC four eighty one in patients with FAP.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

First, starting with a phase one b safety run-in that you're seeing here, which is four milligram of placebo, and then for the next click advancing into an open label phase two signal seeking study. To reduce class related side effects, which are seen with MEK1 two inhibitor, the phase two portion was refined to enroll patients 55 and over. The ongoing phase two portion is evaluating two once daily oral doses of RENC four eighty one. For the four milligram, the primary endpoints include a safety, tolerability, and preliminary efficacy. And the main efficacy point is really percent change in talcordon after twelve weeks of treatment.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

A follow-up endoscopy at week twenty five following a twelve week off treatment period is used to evaluate the durability of the response. And as of 03/17/2025 data cut off, six patients were efficacy evaluable in the four milligram arm. And this is going be the focus of our clinical efficacy data update. But before we go into efficacy, I'd like to cover the safety element. So when you look at the phase 1b and phase two, the data you're seeing here is among the 19 safety evaluable patients.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

We want show the entire cohort that received four eighty one across both phases. The most frequent treatment related AEs were grade one and two, with grade three being about sixteen percent and we did not have any grade four or above. Treating related AEs reported to date were mostly rash, diarrhea, and there were some, left ventricular ejection fraction. When we looked at the phase two portion, the most commonly related treatment related AEs were still rash, CPK, and diarrhea. And I will say that rash and the decreased left ventricle ejection fraction are both consistent with the reported safety profile of approved MEK one two inhibitors and our class effect.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

The LVF LVEF did not lead to any discontinuations Now let's look at the efficacy. Again, I want to preface by saying these are preliminary results and of six efficacy evaluable patients. The distribution of polyp burden changes across all efficacy evaluable patients is shown in the waterfall. The time of data cut off, phase two data shows that the four milligram led to a preliminary 43% median reduction in power burden in post colectomy patients that are 55 and over. Five or six patients, eighty percent, experienced reduction ranging from thirty one to eighty two percent.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

However, one patient did show a substantial increase in polyp burden number from baseline, which has been shown in prior studies as well, something we need to, of course, investigate and understand further. Three patients, three of the six patients achieved a greater than 50% polyp burden reduction at week thirteen. Of the two patients, two maintained a durable greater than 30% reduction even after the off period of the drug. If you go to the next slide, we also wanted to look a little bit deeper into the efficacy data. Recall that the patients with FAP often develop polyps throughout the GI tract, so both the upper and lower regions.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

In the waterfall, you see reductions both in the upper and lower regions with median reductions 50% or higher. These were encouraging and suggest that there's clinical activity across both anatomical sites. We also looked into an important set of endpoints. So I talked about polyp burden reduction, but also polyp count and Spiegelman stage, which is an important classifier of disease severity and the potential for cancer rates down the road. So the table shown here summarizes Spiegelman stage of screening.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Again, at week 13, highlighted in green, you can see about three out of the six patients that are on the four milligram arm experienced a reduction in Spiegelman stage with two patients showing a full change of about a scale of two. While this is, you know, early data and of course, anytime you do Spiegelman, you know, it's potentially confounded by biopsy sampling, it is worth noting that prior pivotal FAP trials have included changes in speed movement stages part of the composite endpoint to track FAP related disease progression. So in terms of summary and next steps, well taken together, and I will point your attention to the left hand side first, the initial phase two preliminary data does show a consistency of insight from the platform bolstered by what we see in vivo and now encouraging early clinical signals. As we look ahead, enrollment for the space to study is ongoing and expect to share additional data with efficacy and safety in the second half of twenty twenty five. I'll now move on to our PI3KH1047 mutant selective program.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

So RET 7,735 is a highly selective PI3K1047, a mutant selective inhibitor. You know, thirty to forty percent of HR positive breast cancers have PI3K mutations with the H1047R mutation in the kinase domain being the most common, about fourteen percent of HR plus breast cancer. So about anywhere from nine to eleven thousand patients in The US and EU. This molecule was engineered, as I mentioned before, with 100x selectivity of a wild type, demonstrates strong CNS penetration, and from the data we've seen so far, a low risk of metabolic AEs like hyperglycemia. I'll walk you through some of the data that's showing superior efficacy to pipigrant and also KAPI, an AKT inhibitor, with synergy at low doses when combined with CDK four six one inhibitors and SERD.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

The study is currently in candidate profiling with the nomination to DC, as I mentioned before, expect the second half of this year. So let's just take a second in terms of how does a platform what is the platform insight here? You know, we started by applying molecular dynamics to characterize the flexibility of the mutant PI3K alpha protein. It allowed us to capture key conformational snapshots that reveal cryptic mutant specific binding pockets. These insights formed our SAR strategy early on, which is really important, giving us a more precise roadmap for design.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

From there, we use AIML models to prioritize chemical space predicted to optimize potency and selectivity, while also accounting for critical drug like features such as physiochemical properties and Agmed. At any point, I'd love to go through more detail on this. This tightly integrated AI driven approach enabled us to progress a target concept to differentiate a candidate in eighteen months. Again, another example of this learning platform and how we're trying to get better molecules designed faster. Now if you look to the next slide, which is focused on some of the preclinical data that I just mentioned.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Chris mentioned this slide and some of this data in the prior earnings call. So Rec 7,735 shows a dose dependent tumor regression in the CDX models, the PI three k ten forty seven r CDX models compared to a better than standard of care PI3K inhibitors. We have PIK gray here, which is one of the first generation wild type scorpion and also the lots of compound. This supports a differentiated safety profile while maintaining efficacy. We do not see an increase in hyperglycemia markers as you can see to the right side.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Now if you go to the next slide, I just wanna share some of the newer data, head to head with CAPI. Here, you see REC seven seven three five at eighteen point seven mgs per kg, which is the medium dose, significantly outperformed high dose CAPI into regression. Even the low dose six point two five mgs per kg per kilogram dose was comparable to cAPI. And in terms of tolerability, we did not have any weight loss observed, which we which we have seen with some of the other agents today in these mass models. We also looked at some additional data in combination with endocrine therapy.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Rec seven thousand seven thirty five significantly enhances the effect of filvestrant, so CDK four six as well as certain inhibitors in the CDX models. At low doses, REC seven thousand seven thirty five alone was more effective than this standard of care combo. And when it's added, we see some further deepening of response. So again, preclinical early data, but a rationale the compelling rationale for seven thousand seven thirty five in combination regimens for HR plus HER2 negative breast cancer. So next steps, as I mentioned, again, we see that arc, right, the biological insight, but I would say much more focused on the biological insight in terms of radar selectivity by going after the most common mutation in PI3K, the design elements that I just mentioned, novel scaffold, and then also some of the in vivo data that we're seeing, which is encouraging for us as a potential best in class therapy.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

DC nomination is planned for second half twenty twenty five, with, again, the goal of addressing a clear patient need in a genetically defined population. Next, I will share a little bit more data about our ENPP1 inhibitor shifting to rare disease. REV-one hundred two is a potent, highly selective ENPP1 inhibitor we're developing with our partner, Rally Bio, or HPP, a rare debilitating bone disorder with limited treatment options, particularly for adults. The treatment options today are injectables, three to six injectables a week, injections a week, and that is challenging. And so we think that there is a significant patient population that would benefit from a first oral nonimmunogenic disease modifying therapy that can reduce the burden and cost of lifelong enzyme replacement therapies, which is the current standard.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

So again, platform insight here. This is another example of the Recursion OS delivering targeted innovation. We identified structural insights into e and p p one and used our generative AI design and ML driven optimization to create novel scaffolds with high safety margins and oral dosing potential. This was not easy. This is not for the faint of heart.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

This took a lot of reps. But by modeling human acne early, we built confidence in the clinical profile before nominating a candidate. This is how we wanna front load some of the risks in our now go forward ad portfolio purchase strategy. So looking at some of the preclinical data, so I'll show you two slides on this. The first one is rev one zero two in early onset HPP models.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

In an unpublished early onset knockout model, rev one zero two significantly extended survival. So you can see on the right on the left hand side, survival lines for the early onset HPP models. And when you look to the right, you will see also reduced PPI levels, which is a known biomarker that is critical for bone mineralization and restored bone density close to wild type levels. You'll see on the chart to the very right, the ALPL knockout group was not shown, given all of the mice died around the beginning age. These data suggest the compound can address both biochemical and skeletal aspects of HPP in early onset models.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

But we also wanted to look at late onset models, right, which more closely mimics adult HPP. And as you can see to the left hand side, it corrected key skeletal defects and normalized the patella structure. And when you look at the right hand side, very consistency, it also we also observed a clear dose dependent reduction in plasma PPI, further validating the mechanism. So lots more work to do in this space, but, you know, we see again the arc here, the biology design in vivo with phase one expected to initiate in the second half of twenty twenty six. We see a compelling opportunity to address unmet needs in juvenile and adult onset disease where access convenience and long term tolerability for chronic diseases starts early, especially critical.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

So those were the three programs where I shared a deep dive. Now I'm going to do a quick tour, pager, just some of the other oncology go forward programs. So the first one, RBM thirty nine degrader, identified again, as I mentioned earlier, through our phenotypic platform, it mimics closely CDK 12 loss phenotypically and induces in our preclinical models, as you can see in the middle, dose dependent antitumor activity in preclinical models. This is one place where I wanna emphasize an area of platform capability that you'll see across all of these programs, which is precision selection of patients. This is where ClinTech and causal AI efforts that we're really doubling down on in our platform is helping us accelerate for the right patients, but then also site selection and enrollment.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

The study right now is in phase one monotherapy with an update expected first half of twenty twenty six. CDK seven, I've mentioned a little bit about CDK seven before, how we leverage our platform to optimize the PKPD and therapeutic index. In the middle, you see potent tumor regression. We're not showing some of the data, the clinical data from December. You can find it online, but we also sell, you know, one complete PR confirmed PR, multiple stable diseases as well.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Now what we're doing is we're using causal AI and human genetics, you know, with some of the Tempus data then also some of the capabilities we're building in house and cell line panels. We do both, the best of both worlds to guide precision indication expansion with monotherapy escalation ongoing in combination, as I said, initiating first half of twenty twenty five. And MALT1, you know, I won't go through the details of MALT1 that I shared before, but improved safety and efficacy profile through structure based design and hotspot analysis showed both single agent and synergistic activity. You can see in the middle in vivo data and durable response. We're also you know, this is a competitive space.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

So we're using advanced RWA analytics, ClinTech approaches to accelerate recruitment. Already, we've identified in a matter of days, 50 new high potential trial sites in The UK and states to support efficient, steady execution. So back to our principles from before, we can have faster POC. And I'll wrap it up by talking a little bit about our partner programs. I know we share, you know, milestones, we share the upfronts, etcetera.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

But how are we? What is the nature of this partnership scientifically? These partnerships reflect you know, reflect tackling complex targets and generating high quality molecules across a range of diseases, and also reflects strong external validation of our approach, an additional opportunity for us to learn and create medicines, as Chris was saying earlier, and value for the company. So let's start with Sanofi. We achieved four milestones to date with Sanofi.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

In a partnership, it's about three years to date. That is multiple challenging targets the team is working on in both immunology and oncology. The collaboration uses the full suite of the Recursion end to end platform, in vivo biology all the way to generative chemistry and active learning to rapidly design and optimize first in class and best in class compounds. I wanna emphasize what's coming up next. Over the next twelve to eighteen months, we have development candidate milestones coming up, which is an important milestone, additional milestone for us and an potential opt in with Sanofi that starts at that base.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

With Roche, Recursion OS is being used. You know, we've talked about some of the math, but I just wanted to maybe add a little bit more color. You know, Recursion uses Hubec maps, but Recursion has also developed a slew of disease context specific maps. For instance, in this partnerships, more than five phenomaps and over 5,000 transcriptomes across neuroscience and GI oncology, feeding discovery at a really fast pace. We, as you know, last year in the fall triggered a 30,000,000 map that was accepted, and then we have more map milestones that are that are coming.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

The other piece, and we fondly calls it lab in the loop, which we really, really like, model enables not just, you know, a tight cycle of AI driven hypothesis generation, But really important for this partnership, we're pivoting from the maps and the novel biology to now programs. Right? Experimental validation and the design of the programs to to have the potential to make new medicines for these insights. So I wanna wrap it up by saying we have multiple internal and external pipeline catalysts that are coming out. As you've seen some of the internal ones laid on top, but then also meaningful partnership catalysts with new phenomap options, program initiations, and potential options exercised by some of our partners.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

So with that, I'm going to conclude the R and D and pipeline update both internal, external. Let me close by saying that we are encouraged by the momentum we're seeing, both internally and with our partner programs, and we remain committed to a disciplined portfolio strategy that prioritizes scientific differentiation, capital efficiency and value creation above all, the clear path to impact. With that, I will turn it over to our CFO, Ben Taylor, for the financial update.

[Ben Taylor, CFO & President Recursion UK at Recursion Pharmaceuticals]

Sure. Thank you, Anita. So where we wanted to start with when we're going through some of the financials is not only to talk about the pipeline prioritization that John just went through, and Chris gave high level overview at the beginning, but also talk about how we are trying to make data driven, disciplined decisions across the organization to really maximize our ability to reach all of those milestones that were on the previous previous slide. So if you look at how we've been adjusting our operations, not only since the merger, but even before, and trying to align that to be able to drive our cash runway as long as possible, what you can see is we've really had a focus on adjusting our capacity over our capabilities. And what I mean by that is our capabilities are the platform overall, what we can actually produce out of that platform.

[Ben Taylor, CFO & President Recursion UK at Recursion Pharmaceuticals]

The capacity would be more of how many can we produce. And so because we are a tech company, because we focus on automation, we actually have a great ability to adjust our capacity based on the market conditions, based on the pipeline that we wanna execute, while still being able to enable all of those same capabilities across the platform. And that's exactly what you'll see from us both during the first quarter, but also through the rest of the year. Couple different points that we wanted to hit on. One, we ended the quarter with 509,000,000 in cash.

[Ben Taylor, CFO & President Recursion UK at Recursion Pharmaceuticals]

We will talk a bit about cash burn. This is something that's really important because it's a little confusing to anyone outside of the company looking at our financial statements to try and understand what are you actually spending operationally to execute on all of those things that you're doing. So what we try to do is key metrics and put them into the context of a cash operational burn. So how are we spending money excluding the influence that we get from partnerships, excluding the non cash effects. And so during the first quarter of twenty five, as you'll see, that was about a hundred and 18,000,000, including all of our cash operating expenses and our capital expenditures, not including anything that was an inflow from our partnerships or financings and excluding transaction costs as a result of the merger.

[Ben Taylor, CFO & President Recursion UK at Recursion Pharmaceuticals]

So in total, we expect a cash runway into mid twenty twenty seven. Now what's going into that assumption is really based on the three different levels of how we drive cash runway. The first is thinking about our partnerships. So we've brought in 450,000,000 from our partners over the existing partnerships with us. In addition, we've also in addition, we've also been able to hit on four four milestones in Sanofi partnership over the the last eighteen months.

[Ben Taylor, CFO & President Recursion UK at Recursion Pharmaceuticals]

We hit on a major milestone with Roche as well. And so we are now driving towards continuing to execute on those existing partnerships and really leveraging the cash flows and the partnership milestones available to us there. We will continue to look at new business development as well and have the ability to match our operational capacity to meet those partnerships. In addition, as we've historically done, financing is another aspect that we will look at. We intend just to follow the same business patterns that we have in the past on that aspect.

[Ben Taylor, CFO & President Recursion UK at Recursion Pharmaceuticals]

Finally, what is completely in our control is our cash burn and being able to adjust our cash burn over time based on what our priorities are inside of the business. And so that's where you've seen us take the steps that we have for example, to be able to maximize our runway as far as possible. So if we can go on to the next slide, what you can see is a pre and a post in some ways. So on the left side of the page is the 2024. This is a non GAAP measure, a cash burn from the two different organizations.

[Ben Taylor, CFO & President Recursion UK at Recursion Pharmaceuticals]

What it breaks down to is about 600,000,000 on a combined basis between the two companies, excluding all of the partnership and financing inflows. What we're looking at for this year is a budget of less than or equal to 450,000,000 in the same terms. How we are doing that? One, talked about the pipeline prioritization, but we've also been able to reach deep into a number of different corporate expenses, adjusting capacity as I talked about, and also trying to leverage the fact that we are a technology platform. We should continue to be able to do more with less because we focus on encoding and automating our processes so that we can accomplish more goals the next year than we did the previous one using lots of resources.

[Ben Taylor, CFO & President Recursion UK at Recursion Pharmaceuticals]

You'll see us continue to drive towards that every chance that we can possibly get. With that, I'll turn it back over to Chris.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

Thanks, Ben. I wanna talk a little bit about Recursion two point o and the experiment that we are here to run at Recursion. You've heard from Ben and Najat today, and on behalf of them and the entire team, we thank you for for your attention. I just want to share with all of you that we believe that Recursion will continue to lead the tech bio space, and we're going to do that through this sustainable continued growth plan that we shared today. We're going to remain committed to our internal pipeline, though it's going be more focused than it has been in the past.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

We're going to continue to execute on our partnerships, and we believe there are substantial milestones that we have the potential to earn over the coming quarters and years. We're going to continue to increase our focus on leveraging AI, not only in drug discovery, but all the way through development with some really exciting build happening in clinical development that we'll share more on soon. And as Ben just shared, we're gonna continue increasing the efficiency of Recursion while also never stopping our investment in the Recursion operating system because ultimately, it's that operating system, that learning system that we believe will give Recursion an advantage in the coming years. With that, huge thanks to all of you for your attention. I think we're going to go ahead and turn it over to Q and A.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

I will start. It looks like Eric Joseph at JPMorgan has asked, Given your stated runway to mid-twenty twenty seven, what burn rate do you anticipate exiting 25 or entering 26 with? From where would you expect incremental efficiencies still to be derived? And do you plan to raise capital? For that, I'll turn it over to you, Ben.

[Ben Taylor, CFO & President Recursion UK at Recursion Pharmaceuticals]

Sure. Of course. So we haven't given specific guidance on the runway, but you can imagine if our budget for this year is 450,000,000 or less, we're targeting a runway of less than that. And so we will give additional detail as the year goes forward. I think we're also going to continue to look for different efficiencies across the organization.

[Ben Taylor, CFO & President Recursion UK at Recursion Pharmaceuticals]

Let me give you a couple of examples. We've been able to, for example, drive better contracts with our partners, because we're a more skilled organization. We've been able to integrate different parts of the business where we had high cost on one side previously and low cost on another, eventually reaching lower cost overall. And we'll continue to drive into every aspects that we can extend that runway without impacting our ability to execute and deliver on our pipeline programs both internally and with our partnerships. So we'll keep driving on that.

[Ben Taylor, CFO & President Recursion UK at Recursion Pharmaceuticals]

As far as raising capital, as you know, we and no one else give guidance on financing, but we plan to just really continue our previous business practices. We'll continue watching the market. We do have an ATM facility which we have used moderately in the past and so we'll continue to use our current business practices going forward.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

Thank you so much, Ben. Next, we've got James and Joe asking a question on partnerships. When can we see an option on a molecule candidate from one of your four main partnerships, and any further insights on new levers in the OS for accelerating partnership programs to commercialization. I'll take the first part of that. We've already had four programs optioned in our collaboration with Sanofi, another program optioned in our collaboration with First Genentech, and we believe that those programs and many others coming behind them have the potential not only to get those early options, but perhaps to have the potential to to go to later stage options where they would might move into our partners' pipelines.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

Obviously, the economics are significantly higher at those stages. So we're continuing to do that work, and we think a lot of promising progress so far. For the second part, maybe I'll turn it over to you, Najat. Any further insights on new levers in the OS for accelerating partnership programs to commercialization?

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Yeah. I mean, I'll I'll mention maybe three. You know, one on biology. We've talked a lot about the phenomics work that the version is doing now adding transcriptomic. I think the clinical genomic data that we have, it really helps you make the stack multimodal, but not just to understand holistically the biology, but also very early on start to better understand what the patient population may be.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Really creating a more differentiated TPP upfront and earlier on, that's one area. The second, you know, on the chemistry and the design module, saw some of the examples I shared for internal. It's very, very similar to what we're doing with partners in terms of can we try to model in or model out aspects that we know are challenging with molecular dynamics, QM. You'll see much more coming up in that space. And then also being able to model and predict some of the acne aspects that makes a drug more drug like earlier on.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

And the third is more in development. And Chris touched on this a little bit. You know, as we partner, whether it's not just on a discovery program perspective, but also on potential partnership on an asset perspective, etcetera, we're also going to leverage some of our ClinTech capabilities. Again, using multimodal data, really precisely understand the patient population that we just target that would have the highest signal to noise, and then also more being more rapid in terms of how we can do it.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

Thanks, Najat. Next up, we've got Vikram from Morgan Stanley, who's asking a question on the pipeline. Your pipeline prioritization leans heavily towards oncology. Do you generally see a pivot away from rare disease for your pipeline and platform, and if so, which aspects of the recursion operating system and underlying approach do you think make Onca a stronger fit in addition to rare disease? I think at a high level, we believe that both oncology and rare disease are fantastic areas for us to deploy our platform.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

In both of those areas, we have some genetic markers that often give us sort of an anchor point of biology from which to work from, and so we'll continue to follow the data. I can imagine us continuing to drive both rare disease and oncology programs forward. The data is going to be ultimately what drives what the balance of the portfolio looks like, but I do not see us abandoning either oncology or rare disease in the near term. Next up, we'll go to Dennis from Jefferies, Gil from Needham, Alec from Bank of America, Brendan from Cowen, and many other folks who are asking questions around the FAP readout. And I'm gonna I'm gonna read these off one by one because we've got a whole bunch here, and I'll have Najat answer them.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

So the very first one, talk about the FAP data shared at DVW, and how is that differentiated from other programs that you may have seen in this space?

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Yep. Happy to do that. So when we look at the FAP data, which I just shared, efficacy valuable about NF six patients, median polyp burden reduction in the forties, 40 three percent. But, again, early data. Right?

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

And and I also talked a little bit about the safety where most of what you're seeing there is, you know, on target class effect from MEK one two inhibitors. The two other programs that exist, so celecoxib, as I mentioned, used off label and then also another program focused on rapamycin and capsulidarapamycin, which is in a competitor's pipeline. Both so far have shown polyp, reductions 20 to 30%. So just from the primary endpoint that we're looking at. The second piece I think that's also important, to note is the change in the Spiegelman scoring.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

And also, are encouraged by the congruence that we see, Paula Burden, Paula Count, and then also in Spiegelman stage. Again, early data, but some of the reductions that we're seeing so far is is is pretty encouraging. I see there's another question in terms of the non responders. I'm just gonna take that and couple it so I'm talking through the data more holistically. Non responder with a six fold increase in polyps, what do we see in natural history?

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

So in natural history, these the polyp burden is increasing for these patients. But there are prior studies, and one of our competitor study, where about forty to fifty percent of patients are non responders in these studies, right? Non responders from a polyp burden or from a polyp count perspective. And recent data has shown that even in that forty percent of non responders of polyp increase, there is anywhere from one to two to six x increase in polyp burden. So for our one non responder, as I mentioned earlier, we're gonna do we're doing a lot of work to better understand the reason for that, and and then the work will continue.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

As we have a larger end, these numbers will evolve, and that's gonna be important as we look for a more mature data later on this year.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

The next question on FAP was, will we continue to dose higher than four milligrams?

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

You know, what we want to do first is we're encouraged by the reduction that we're seeing, 30% to 80% polyburden reduction. That's pretty significant. We wanna look at some of the data later this year, October. And then next steps would be either if we need to dose higher, but then also discussions with the regulatory agencies and the potential path forward. So first, we wanna complete the four milligram cohort, really better understand data, and then take next steps from there.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

And then the last two, where do you see the bar for success in FAP? First, in terms of FDA approval, but also as it relates to broader uptake among patients?

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Yeah. I mean, that's a great question. Look, bar for success for FAP, you know, what we see with some of the off label agents that are used anywhere from twenty to thirty percent, there's nothing approved. So clearly, there's a huge unmet need for these patients because if not, they're doing multiple surgeries throughout their lifetime. There is another agent that's in just starting phase three.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

You know, you can see some of the data. Our polyp burden reduction to date is encouraging and higher, but much more to do in terms of learning about the data.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

And any next steps for the program?

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Yeah. So as I mentioned, you know, more patients on the four milligram by the end of this year and then conversations with the FDA on the path forward. You know, so far, endpoints have been a composite endpoint for FAP, and one of the components, as I mentioned earlier, is actually the inclusion of Spiegelman's score. So, you know, we're watching all of those different aspects and more to come. We do this soon.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

Thanks. Alright. Next up, have Alec from BofA who's asking, remind us how CCM, NF two, and C diff, which are three of the programs that we discontinued, were initially discovered or developed and how the refined pipeline strategy maybe better reflects the current capabilities of the Version platform. I'll take this one. So, look, CCM, NF two, and FAP were all products of our Recursion 0.1 platform, where we were using RNAi and and tools to identify repurposing candidates.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

And it's exciting to see the FAP program showing us some preliminary efficacy. Our our C. Diff program came out of our Recursion one point o platform where we started to explore new chemical entities, and we see no reason today why the science doesn't continue to hold on that program. That decision today was really based on looking at the commercial landscape and the unmet need and making sure we prioritize our investment. Obviously, n are too low to to draw any conclusions, but we designed recursion as a learning platform where each generation of the platform has a higher probability of identifying and uncovering medicines that we think will have an improved probability of success.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

And, again, the add on Recursion 0.1 will be too low versus Recursion one point o. But as we continue to learn and iterate on this platform, I'm confident that on average, the probability of success of our programs is likely to go up. That's what we're that's what we're here to do.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

And, Chris, if I could just add one point coming in less than a year ago, just looking at the overall programs, just going back to our go forward portfolio strategy, one of the things you'll see I mentioned is really being very thoughtful in terms of how the molecules are designed, and we can do that in house today. And even more so doubling down on that post the integration with Exyncia. CCM and NF2 and FAPD, these were all in licensed slash repurposed programs. So that's number one from a design perspective, from a chemistry a biology perspective, Chris mentioned as well. And then the third is also the development strategy.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Right? I think for a company like us, having rapid learnings, rapid go, no go, rapid and clear with endpoints that have some precedence was also gonna be important for us. So those are some of the other aspects that we're incorporating.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

That's the kind of scaled learning that we're gonna get with a with a scaled portfolio. And in some way related, Gil from Needham is asking if we contextualize the use of AI in clinical development, like for study design, and maybe how that's relevant for programs like RBM thirty nine. I know this has been a big area of focus over the last year.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Yes. Absolutely. So, yeah, let's take whether it's CDK seven, RBM, or even MALT one. So I'll just take CDK seven as an example. You know, there are other programs in in in in the competitor pipeline.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

You know, which indications do you go after? Solid tumors is very broad with RVM, same thing with others. How do you enrich the what how do you enrich the biomarker for the patient population? How do you ensure that the patient populations you're going into have certain overexpression or underexpression that is predictive of greater signal to noise. I can speak more about that, but that's one of the things that we're doing, leveraging clinical genomic data like TEMPUS, but then also a lot of predictive algorithms that we are developing from our cell line work that we're doing internally as well.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

So much more to say here. The last thing I wanna say, you know, sometimes enrollment and recruitment gets forgotten. And also, sometimes real world data to contextualize any open label study also gets forgotten. Both of those are really important, not just for regulatory purposes, but also for internal go no go decision making. How much conviction do we have in the signal to noise?

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

So a lot of those approaches really scaling up in the last two years, I say.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

Perfect. Next up, we have Melissa who asks, what criteria were used to prioritize certain programs over others, and how does this focus advance or align with Recursion's long term strategic objectives? Please.

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

Yeah. I mean, in terms of the criteria that we use is very much what, you know, is best in class in industry. So first and foremost, it always starts with what is the potential value of the drug? Patient population unmet need, scientific data starting from preclinical, clinical data, competitive differentiation, etcetera. Also, in terms of the development plan, is there a feasible development plan?

[Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director at Recursion Pharmaceuticals]

And then we look at risk, which is the other side of the coin. So for each program, look, if I can coin it in one sentence, taking all of those components and, you know, we've done our computational approach bottom up, we're not being objective or we're being objective in terms of the decision making, comes down to, do you believe this can be a differentiated medicine, and is it serving an unmet need that will exist by the time you are going to be in the market? That's the most important. That bar has to be very, very high for us.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

Perfect. And the final question, Brendan from Cowen asks, do you expect any meaningful impact to your internal or partnership strategy in light of the FDA's updated animal testing guidance? And I'll take that one to end us. Look. Recursion was built for an evolving regulatory framework like the one we're seeing from the FDA, and we'll continue to monitor for additional, updates as as, the FDA, explores all the ways that AI and other tools can be used.

[Chris Gibson, Co-Founder & CEO at Recursion Pharmaceuticals]

But from our discovery platform to our predictive acne platform to even our in vivo platform, we are generating large scale datasets. We're building foundation models that are allowing us to move from a test at scale in the lab sort of regime for preclinical studies to a predict and validate regime for preclinical studies. And so I think Recursion is not just positioned to take advantage of these regulatory updates, but actually positioned to lead in this space going forward. So with that, we appreciate everybody's deep attention. Thanks to everyone for joining, and we look forward to seeing you all out on the street. Thank you so much, everybody. Bye bye.

Participants

Executives

• Chris Gibson, Co-Founder & CEO
• Najat Khan, Chief R&D Officer, Chief Commercial Officer and Director
• Ben Taylor, CFO & President Recursion UK