Greetings, and welcome to the Dyadic International 2019 Year-End Financial Results Conference Call. [Operator Instructions]. As a reminder, this conference is being recorded. It's now my pleasure to introduce your host, Ping Rawson. Please go ahead.

Thank you, Operator. Good evening, everyone, and welcome to our year-end 2019 conference call. A press release with Dyadic International's 2019 financial results was issued earlier today. The press release on Form 8-K and Dyadic's 10-K have been posted to the SEC and Dyadic website. On today's call, our President and CEO, Mark Emalfarb, will provide a review of the business under the corporate accomplishments for 2019 and an update on the progress we are making in 2020. I will follow with a review of our financial results in more detail. We'll then provide you with an opportunity to ask questions. Matthew Jones and Dr. Ronen Tchelet will join Mark and I to answer your questions. At this time, I would like to inform you that certain commentary made in this conference call may be considered forward-looking statements, which involve risks and uncertainties and other factors that could cause Dyadic's actual results, performance, scientific or otherwise, or achievements to be materially different from those expressed or implied by these forward-looking statements. Dyadic expressly disclaims any intent or obligation to update any forward-looking statements, except as required by law. For more information about factors that may cause actual results to be materially different from forward-looking statements, please refer to the press release we issued today as well as risks described in our annual report on Form 10-K for the year-end December 31, 2019, particularly in the section titled Risk Factors. This information can be found on our other filings with the SEC when available. With that, I will now turn the call over to Mark.

Thank you, Ping. Welcome, everyone, and thank you for joining us today. Before we begin tonight's conference call, I hope you and your families are safe and staying as best you can out of harm's way as the world continues to struggle with the coronavirus outbreak. We here at Dyadic are committed to help combat this terrible virus whenever we can by offering access to our C1 technology to industry and governmental agencies globally to try and help speed the development and commercialization of potential SARS-CoV-2 vaccines and antibodies to help combat the coronavirus. Later on in the call, I will get into more details about some of the things we have going on. I am pleased to report that 2019 was another successful year for Dyadic, as we achieved several important scientific and business milestones and expanded our global presence. While still early in 2020, we are seeing continued momentum with our existing collaborations as well as potential new collaborations. During 2019, we entered into 6 new proof-of-concept research collaborations to express different types of biologic vaccines and drugs for both human and animal health and entered into 2 research licenses. As a result, Dyadic's pipeline of opportunity is gaining more depth and diversity of projects that we anticipate will bring significant future value to the company. Last week, we entered into a nonexclusive research license with WuXi Biologics, one of the world's most prestigious global contract development and manufacturing organizations, or CDMO as they are most commonly referred to, and entered into another fully funded feasibility study with another leading animal health company. We are now working with 3 of the top 4 animal health companies, which we believe give us a strong foothold in this market. To assist in the global fight against the COVID-19 pandemic, we…

Thank you, Mark. Before I discuss our operating results, I'd like to provide you with a few key financial takeaways from 2019. We continue to successfully pursue our growth strategy while maintaining a strong financial position throughout the fiscal year ending 2019 with approximately $36 million in cash and investment-grade securities and no debt. Second, partner-funded R&D collaborations remains a very important component of our financial strategy, with research and development revenue increasing approximately 30% year-over-year. Finally, the company uplisted to the NASDAQ in April 2019 and, later in the year, joined the Russell Microcap Index, further increasing our visibility in the financial community. Our operating results are as follows. Research and development revenue increased 30% to approximately $1,681,000 in fiscal 2019 compared to $1,295,000 for fiscal 2018. The cost of research and development revenue increased 42% to approximately $1,460,000 in 2019 compared to $1,027,000 in 2018. The year-over-year increases in revenue and cost of research and development revenue reflected a greater number of collaborations this past year, with 10 in 2019 compared to 6 in 2018. Interest income increased 10.1% to approximately $985,000 in 2019 compared to $895,000 for 2018. The year-over-year increase reflected a higher yield on the company's investment-grade securities. Research and development expenses were $3,088,000 compared to $2,102,000 in 2018, primarily due to an increase in internal research project conducted at VTT, which is our CRO. Related party research and development expenses were approximately $869,000 in 2019 compared to $1,216,000 in the prior year. The decrease was primarily due to the completion of our 2 years' BDI research service agreement in June of 2019. G&A expenses were $5,520,000 in 2019 compared to $4,523,000 in 2018, with the increase primarily reflecting greater noncash share-based compensation expenses of $717,000 related to 2019 stock option awards and options vested…

[Operator Instructions]. Our first question is coming from Ahu Demir from NOBLE Capital.

Great progress, and I want to congratulate you. It was a great year for Dyadic. So my first question will be on the COVID-19. So can you give a little bit more information, Mark or Matt, whoever would like to take it, on the partnerships on the vaccine, how it is going? And my second question will be how the pandemic affects your manufacturing and your in-house efforts.

Yes. So I guess, I'll take that question. First of all, the first collaboration that we're working with was The Israel Institute of Biologic Research and they have their own internal funding. They have -- there are 50 scientists that are working on this project, as reported by the IIBR. And they're working on both the antibodies and vaccines, both. And they have their own cGMP through at least Phase I manufacturing. So that's operating its own. They're just providing us with gene sequences and we're creating constructs. And we're taking those, putting them into C1 and then producing the proteins for them to study, do the analytics, test in animal models and then, hopefully, put those into human beings sooner than later. That's the first one. The second opportunity that we're involved with is, as I mentioned, in the ZAPI program, which we've been involved in for over 4 years. They've been working on SARS and MERS and coronavirus in ZAPI as well. And these researchers, 3 of the top 20 researchers in the world for coronavirus, were involved in the ZAPI project. And so based on the success that they saw with C1 in the antigen with the ZAPI antigen, where we produced 35x more than baculovirus and 17x more than they asked, 100x more than E. coli, they recognize that C1 can be used to make massive amounts of low-cost, potentially better vaccines. And so together, we put together a proposal, and we now are receiving those genes from them, cloning them into C1. They're going to do the animal studies. And what ZAPI did is they have this built-in infrastructure to rapidly bring vaccines in a market quickly and in a more efficient way. And so these guys actually have a model where they know what…

One thing I want to add on that -- Ahu, one thing I want to add on that and clarify is we are not directly inventing the construct of the vaccine, because I sometimes got that question. We are enabling other developers to make their own vaccine, and we are helping them with the expression by using C1. And that's the reason that we can work with multiple companies and, at the same time, who are -- have the expertise to develop the vaccine construct. And I think our advantage, as you know, that is more in the manufacturing and production side of how to use C1 to develop and manufacture a large quantity of vaccine or antibody in a short period of time with low cost.

Matt, do you want to add anything to that, Matt or Ronen?

Well, Matthew here. And again, just the very first comments from Mark, I wish everyone on the call, your families and friends are all safe and well. I would just add to that, that the whole point here is to get drugs of use into patients. And so C1, as we described, is a very strong powerful platform to do that. The announcements we've made just recently are with companies both on the research side, and as WuXi's statement today, obviously, with companies that have global huge GMP commercial presence too. So very exciting. And I think we are trying to display here a diversity of opportunity both in human and in animal health campaigns that obviously are about getting these vaccines, other drugs into commercial development. So without betraying the confidences, that's really the essence of what I think we want to say here. Plus, the partners we're working with are credible and very experienced in the drug development program and very familiar with the regulatory authorities. They have internal HIT resources and expertise, and we're very pleased to be tapping into that.

Ronen, do you have anything you want to add there too while you're online, since it's so late there in Hungary?

Yes, okay. Yes, I think that the last year and even before, we really showed the great advantage of C1, especially in rapidly developed production platform, especially for vaccine, but for any other proteins. And I think this advantage is being seen by other companies, and this is why now we get more and more attraction and companies would like to really use C1 as a good production platform for many applications, many types of proteins. And I think this is -- I think was our best achievement in 2019.

And I think what Ronen is saying, if you think about what we've been doing on our internal funding, it's been going to glyco-engineering the cells, reducing the protease background, rolling out a program at faster, better, quicker, higher levels for more diverse types. We've even thrown the kitchen sink from virtually all kinds of pharmaceutical and animal and human health companies before this. So we have experience with the antibody, with virus-like particles, all those things we've talked about, we've been able to express those at very high levels, at record levels in most cases. And so when it came to the opportunity of the coronavirus, it's an extra opportunity. Our normal business is ongoing. It's continuing. We're not being impacted virtually at all. Of course, there's a few things here and there. But overall, like we just signed a new animal health in the middle of this. We have more discussions going right now. We have several proposals out in the hands of pharmaceutical and animal health companies and potentially also more coronavirus opportunities. Those proposals are out in their hands and are being evaluated to come in and use C1 to help solve their problems and bring them solutions. So we've continued to evolve and improve this platform, and it's a platform. And we want to -- can't stress that enough, we're not a one horse/pony race. We probably have 8 out of the 10 horses in the race. And that's what we want to have. We want to have more and more partners to do more and more things at higher and higher levels. In this particular case, we have a unique advantage, because not only can C1 produce a lot of the vaccine, which is demonstrated both in the Sanofi influenza project but also in…

My second question will be on the partnership. So with today's partnership, research collaboration, you brought your portfolio up to 10 partners, and I believe 7 of them are disclosed. So would you be able to give us some time line on those projects? When do we expect them to end? Or when do we expect to see data? Or when do we expect them to complete and move to -- progress to the next step?

Yes. Matt, do you want to take that one?

Sure. I think two answers to your question. The first is, trust us, whenever we are allowed to share data publicly, whenever we can, of course, share announcements, like we did just today with WuXi, with that collaboration and others previously, we do so. And so we look forward to announcing to the world where we can. There are, as Mark said earlier, our internally funded R&D projects are progressing really well, particularly the glyco-engineering updates Mark just shared. And that does 2 things for us. It means that we can speak to wider markets around different kinds of challenges and help and enable them overcome those challenges. So different strains, for example, and abilities for vaccines or mAbs. And the second is to be able to work not just with big pharma. Obviously, we do a lot of that. But as Mark said, we also speak to foundations, to government bodies, to other research institutions and real strong thought leaders. And COVID-19 is one example of an area, obviously, which is in vogue, clearly, very importantly, but as well find a cheap effective solution to this. But we look forward to announcing more collaboration updates on data as we go through this year. And I think we have every wind in our sail to do so. The diversity of projects based on the more quickly, perhaps the faster regulatory pathway for animal health, the fact we're working with 3 of the top 4 global companies there. These are companies who are only there to get these vaccines or mAbs or other drugs into toxicology studies and then through the appropriate regulatory pathway to market. That's all they do. And that's what we would like to discuss with them and announce updates as we go forward.

And just to clarify that, unlike we haven't been in humans with the drug produced from C1, we've now been in cattle and we had great results. We've been in animals. So we've already overcome that hurdle in the animal health, and that data is helping generate better, stronger deals, which is why 3 out of the top 4, and you can bet we're working on the next and a whole bunch of other ones on top of that. So to your point, Sanofi, we're going to get information. We've met with them several times. We're preparing presentations. They're going to present those. And sometime mid-year, we believe we'll find out where that's going. And the data is very compelling, in our opinion, and we'll see where that leads and what the next steps are.

Our next question today is coming from Alex Emalfarb [ph], a Private Investor.

So as we know, C1 has amazing data in the animal health space. So I guess, just a two part question. Are there any ongoing discussions with animal health companies regarding the license deals? And is Dyadic open to granting exclusive license deal to one of the animal health companies like you did with DuPont in the industrial space?

Yes. Matt, you want to take that?

Happy to. Good question. I think in terms of licensing, again, we're very careful about the very strong cash position, which Ping, our CFO, Mark and others in the team respect and help to protect. And so we don't need to rush into exclusive licensing discussions too early. So when is the right time? So we look at that regularly. We review that on a very regular basis. We talk to our partners and our collaboration partners about the opportunity of working with C1. And to encourage those conversations commercially, as you could guess, licensing and other sorts of deals are discussed. But in terms of exclusivity, no, we are very careful not to have given anything away yet that's exclusive in that sense. And that's a strong position for us, because it means that as we get more attention, as we go into more partnerships and collaborations, which we're announcing all the time, it means that we do so with those partners at the table with, if you like, an equal chance, an equal seat. And we look forward to being able to build off the back of those collaborations getting more data. Ronen presented last year at an important industry conference. We have more this year to present with both our third-party labs and ourselves. And I think this all helps to enable a much stronger licensing conversation to happen in the future. And we, of course, look forward to those but doing so very considerably for our stakeholders and making sure that we get the best deal for each other and for them but, most importantly, that we go into deals that will see these medicines make a real difference and will impact to mankind. And that's really where we focus our R&D efforts.

All right. And then I just have one more question. Has the Board taken any action in connection with the short report published by White Diamond Research?

Well, the short answer -- or maybe long answer is we view the piece as completely not credible. I think from today's press release and conference call, it should be abundantly evident and evident to everyone that it was a piece of fiction. We're working with many of the top pharma companies, research institutes, governmental agencies to enable more efficient and commercially cost-effective health care solutions. We sold our industrial business to DuPont for $75 million, firmly establishing the C1 platform. Following the sale, we began in earnest to develop our incredibly powerful gene expression platform exclusively for human and animal health, therapeutic products, entering an industry where we were virtually unknown. In the last two years, we've had incredible progress, working alongside the most respected scientists in the world to speed the development, lower cost and improve the performance of biologic vaccines and drugs globally. So I guess, the answer is, we'll evaluate it, but we view it as a piece of fiction and kind of history. I'm not going to get in a battle with somebody that are actually uneducated as to the real facts.

Our next question is coming from Alan Stone from WallStreet Research.

Congratulations on your results announced today and your tremendous achievements accomplished last year, also on the collaborations you have going forward. With all the wonderful things that you've been accomplishing, are you starting to get on the radar screens of some of the major biotech and pharmaceutical companies in terms of potentially being acquired down the road as you continue to grow? And where do you see that potentially downstream as you move forward?

Well, I think 6 months or 9 months ago, I mentioned, to be honest with you, we don't need their eyeballs or any more people. They're aware we're here. They've seen the data. Some of them have experienced it firsthand, just like the IIBR did with the enzyme we made to help them defend against sarin gas, for example, dioxin. That's why they jumped in on the coronavirus with us. That's why ZAPI has expanded. That's why the 3 experts of coronavirus has jumped in with us as well. So yes, I think that big pharma, both in animal and human health, are completely aware we're on the map. WuXi today starts going into the CDMO part of the world. It's kind of a shot across the bow, but the other CDMOs, they realize that they better get in sooner than later so they have an equal seat at the table, as Matt pointed out, if and when those opportunities arise. So if you look at the pattern of what we did in industrial biotech, it was done on nonexclusive licenses, and then DuPont came in and bought out that division. In this particular case, you have animal health that could go separately, human health separately. Our metabolite company that we haven't even talked about, the pipeline there is another opportunity that we're exploring with our own internal funds. So I'd say we're in a great position, as Matt points out and Ping. We have plenty of cash. We're not in any hurry to make bad decisions. We're kind of building, as I mentioned before, a skyscraper. Foundation's in the ground, the walls are going up, the roof is going to be put on, and the tenants are going to get filled. And then, of course, it gets more and more valuable the more and more tenants that are in the building, and they're paying rent. And that's the goal. The goal here is to really use this technology platform to make dozens, if not hundreds, maybe even thousands, of proteins of all kinds of uses and applications in human and animal health; and today, try to help the world solve the problem that we have today with the coronavirus outbreak, be ready for the next pandemic; and lower the cost of prescription drugs, 3 shots on goal with 1 swing of the bat. So I'd say we're in a strong position to weather the storm.

Congratulations. That's a great analogy. And keep up the great work.

Our next question today is coming from John Vandermosten from Zacks Investment Research.

I wanted to start out with a question on WuXi and how they might eventually, at some point, develop a protein or antibody with a partner, I mean, as I'm trying to understand that they will develop the platform and then another developer will come along, another sponsor will come along, potentially when you're already working with -- to develop something. Is that how it might work? Or is there another pathway forward there?

Well, let me start, and then I'm going to let Matt finish because he used to work for Lonza, which is a competitor of WuXi. So he's probably better equipped to answer the question. But if you think about it, even in the coronavirus, if we here are successful with our partners, one or more of them, somebody needs to make Phase I batches under CGMP and then Phase II batches and then Phase III and then commercialization. So WuXi could be one of the partners or one of the CDMOs to do that, right? In addition to that, we've improved the technology to a point now that they can refine it and aim it towards specific goals and objectives they have and that their customers have because they have a much bigger outreach than we do to the pharmaceutical industry and to the C-level people that are already paying them millions, if not billions, of dollars to produce products for them. I think somebody mentioned they have a $3.5 billion backlog already. So this is one of the big boys. And they're very innovative. If you think about all the things they've done, they've really advanced the technologies very quickly, very rapidly, and they look to the future. And so Matt, maybe you can pick up from there since you used to work at Lonza and I think you were in the BD role.

Yes, sure, Mark. I mean WuXi are well known to pharma outsourcing decision-makers. They're in the top 10 ED. And they also have moved not just from Shanghai but they have a presence now in Europe, both auto and vaccines as well as other opportunities. So they are accredited. They have a strong regulatory background. As Mark said, they're in the top 10. I think the important thing to think about with WuXi for us is -- and for any stakeholders of Dyadic are that for C1 to be truly successful, it has to do 2 things: It has to attract the attention, dollars and investment both in resource and time from pharma, biotech, government, foundations, et cetera, someone like that. And it also has to attract the attention of a manufacturing agent that can commercialize an opportunity. And so we're very mindful that there is a sort of stepping stone approach. We're delighted that WuXi are first. There could well be others that I'm sure will be watching this news release and thinking of meetings we've had recently and wanted to talk some more. But WuXi, to Mark's point, has been very innovative in some of the conversations we've had, and we are delighted to partner with them here. Once WuXi gets more experienced with C1, once they start talking to their network around the power they see with C1 and as we help to facilitate that, we see that as a win-win. And I think we don't stop there. I think we start here. So I think from Mark's -- to Mark's point, we would add much more than just say that we're delighted to announce that just after a few years of transitioning the business from an industrial enzyme setting, which is a very different setting than the GMP regulated for pharmaceutical-grade, anyway, materials. So it's a great accomplishment, and I think it's just the start now of these sorts of opportunities for C1.

Mark, can I add something here?

Yes, sure. Go ahead, Ping.

Yes. Just to add on, I know Matthew and Mark has been following with WuXi for several years, a couple of years, at least since the transition from DuPont. So now is a good time. We finally get the licensing with them. Another thing is they are actually building a new facility for the microbial facility, which means they are looking at alternative expression platform similar to C1 or in this line, which they see the value of it, especially from our other results and the scientific data in glycoengineering. So they are not just presentation in China. They have another facility in U.K. or Ireland and also some presentation in the U.S. as well. So it's really a global company. And if you look at their forum or their webcast they hosted recently related to COVID-19, all the people they get in touch are all in the top leadership position from the industry. So definitely from BD perspective and from also the science perspective, they can help us in many different ways.

And to bring that to light and to bring it back home, think about ZAPI. I mean, once people use the technology and they play with it and they feel it, it's kind of like getting in a Tesla and you put your foot on the gas and all of a sudden, you feel that power. When you get back in, you're not going to go back to a Volkswagen Beetle. You're going to want to drive that Tesla. And so that's what ZAPI and these guys are doing because they felt it and they experienced it with the antigen that we made 35x more than the second-place cell line. But more importantly, there was an article that just came out recently -- I don't remember the exact title, but we can put it up on our website for you guys -- where the senior leader for the ZAPI, John-Christophe, he talks about, in the article, of new platforms like C1, highlighted C1 in particular, are coming, and the regulatory agencies are going to have to deal with this because we have to be able to do better. And pharma does the same thing over and over again, expect different results, and they're not getting it. And so we think we can really disrupt things, and that's moving along. And I think the coronavirus opened up people's eyes to what else is out there that can actually help us prevent these things in advance and solve the future ones and, at the same time, bring the cost of prescription drugs down. As I mentioned earlier, so you kill three birds with one stone for the same dollar. And that's what we're doing. And the more and more deals we get, the more and more partnerships we get, the more and more money we spend, not just our own but their money. We've learned a lot in these third-party research agreements. I mean Ronen can tell you. I mean we've benefited tremendously on the dollars coming in from our partners to advance the science. Am I right, Ronen?

Yes, absolutely. I think that you're right because we are having so many collaborations now, and all those work is really helping us to improve our science and improve our technology, and more importantly is to improve C1 as a better and better production host. But I also would like to comment maybe on ZAPI because this is one of our breakthrough because the ZAPI goal was actually to be able to rapidly response to any endemic pandemic, something that, unfortunately, we have experienced now. And one of the goals was to not just to be able to by computational analysis to immediately program the right either epitope for the antigen or a neutralizing agent. But then, their goal was also to produce it in a rapidly and high productivity in low-cost production facilities. And actually, in terms of the antigen, until we could show them that C1 can produce the antigen that we were supposed to produce, it was very difficult to find some production host like that. And actually, C1 came as a glove to the hand of this project to show that we can really do that. And C1 is obviously one of the best production host for such applications. And this has, I think, opened us, first of all, to the animal health field, but more importantly also, we believe that it could also open the doors for the human health vaccines. So I think that was the -- actually, what we can gain from our collaborations with other parties, and in this case, was with a big European consortium.

Well, I think that, really, it's a platform technology that, as I mentioned earlier, they have the wherewithal within that group to take it from discovering a gene, which is their job -- they find the genes of interest. They've been doing SARS and MERS and coronavirus for years and other kind of zoonic diseases. They can pop it into C1. We can clone it, we can express it, give it back to them, the protein or the vaccine or the antibody. They can -- they have the animal models already in place. They have the infrastructure to move it into clinical trials, so they can do it rapidly. If the world doesn't take advantage of what those Europeans have spent the last 4 years doing -- and we saw that, and we're taking advantage of that with that group, those 3 people, those 3 -- top 3 coronavirus experts in their institutes, and then also the clinical trial company, CR2O company. So we put together a very, very strong argument that these are the people that knew what they needed. They're not going out and finding things. They already had what they needed, and it's in place. So it's been proven. And now it's just a matter of even when the next pandemic may or may not come -- and hopefully, we never have to deal with it again, but more likely than not, at some point, it will -- they have the system in place, and they're fine-tuning it because you just pop in the new gene, and everything else goes along the way because it's in place. So we're excited about being part of that for the last 4 years. And if you think about the Israelis, you go back to 2018 in January, our press release, went to work on the same thing, a pandemic approach, epidemic approach, biological threats, to be ready for this. So we didn't just wake up and decide we're going to get into this emerging disease area. We've been involved with 2 of the parties, and C1 is just really the workhorse, as Ping points out, to turn those gene discoveries into products. It can be made at larger scales in smaller environments, potentially with better properties at very, very low cost. So through all that science, we learned a lot paid for by not only ourselves but mostly by others.

Okay. Also a question on the cell lines. You have about 4 different cell lines now with different glycosylation patterns, and there's 2 more in the works, the G0F and the G2F. What are some of the settings, I guess, where those would be appropriate? You've got the animal health platform. Are some of those more appropriate for animal health or just different settings where they might be used?

Yes, I'll start, and we'll let Ronen chime in. But the Man3 to Man9, as I mentioned earlier, seems to stimulate immunogenic response to create what we think from theory, at least, from what we've seen in Sanofi and ZAPI. It creates more immunogenicity, which then creates more antibody production and makes a more potent vaccine. So that's perfect for animal health and human health vaccines but not really good for monoclonal antibodies. So that's with the G0, the G0F, the G2, the G2F. Some of those, you need blocking antibodies. Others need CDC activity. Others need ADC activity. And so it's kind of like a Chinese menu, what do you want for what protein. We can kind of match it and give you a better result than a mix of everything, which is what you come with CHO. And maybe, Ronen, you can chime in a little bit if you want on that, or Matt?

No, I'd say -- actually, you summarized it well. But I just want to say that really give us the opportunity to tailor the type of cell lines regarding to the glyco structure to target proteins. So I think that also give us some kind of benefit of other production hosts in the future.

Okay. Last question is just on the new animal health collaboration. What exactly will that be working on? You've outlined some of the targets and some of the other collaborations, but I didn't see what they are for this one.

Yes, I don't think we've made it public because they -- I don't think we can, but it's two different proteins.

Our next question is coming from David Schneider [ph], a Private Investor.

I was wondering, we don't need to mention the countries, but some companies and countries, some of them are not well-known to protect intellectual property. So what steps have you taken to make sure that yours is protected and that you're paid?

Right. I'll let Matt talk about sort of that first, and I can chime in. But we have taken steps...

Yes, we had been...

Well, wait, Matt, before you get into that. We had a discussion with our Board members, in particular, Arindam Bose and Barry Buckland, who know the Chief Scientific Officer actually used to work in Merck with Barry Buckland. And we went through an in-depth interview and understanding of what infrastructure they have in place to protect IP and technology. There's always a risk, but you remember, these people are working with the top 25 pharma companies with their genes and their cell lines every day of the week. But go ahead, Matt.

No, I would just reiterate that. I think we further process internally, which was to call upon our Board but also our network who every day are outsourcing work for big pharma into parts of the world. That may be part of your question. So I think we had that to go off of. We also have our own experience, and we have a relationship with these companies. We understand how they fulfill and qualify the criteria that big pharma have with placing bodies of work. I think what's important to mention is that the -- we are very mindful about IP and FTO. We're also extremely careful about the partnerships that we enter into, including how our NDAs are structured and the MTAs as relevant. So we don't take this responsibility lightly. Without going into details on this call, I'll simply just say that it's not something that we just skip past. We spend a lot of time making sure we protect the business.

Yes, just an easy follow-up question. The Novavax company, if they can't get moving, then what kind of steps could you take? And how long do you have to wait?

Well, we don't have to wait at all. But if you remember, we're not investing any money in that. We haven't transferred the technology to them. So until they get the proper funding, we're not going to do that. So we're focused on bigger fish and other opportunities, and we're letting them sort that out on their own. We're not taking the time and attention to help. We've tried in a few ways to help them earlier, but we don't have the bandwidth to deal with that problem. That's an issue that they need to solve, but we're not going to put C1 there until that issue is solved. And they're good business people, and they've actually -- they are a CDMO, by the way, a small one for vaccines. They've been working on animal vaccines years. It's a good company. What their issues are, to be honest with you, I'm not even sure because we've been so tied up with so many other things. And we're letting them solve that on their own.

I hope that's a good sign, that you're busy and don't have much time to sleep.

Our next question is coming from Dick Williams from Williams Resource Group [ph].

I just have a very simple type of question of color more than specifics. However, I just wanted to make some comments before I get into that. First thing, it's easy to say, while you guys did a great job, but you've done more than a great job. '19 was a superb year, but what you've done this year is beyond belief, all of you. Ronen, you've been spectacular on the scientific side; Matt, you on the business; and of course, Mark as the leader, someone who is a workaholic and puts nothing but hours into this company, for its shareholders, supported by Ping. So I think you guys have altogether done a spectacular job last year and even more this year. So I wanted to go just through a few things. I know it's difficult when you're running a business like this and you're dealing with bigger companies and you can't talk to who they are. And of course, in the street, whereas these prospective shareholders or shareholders who are -- everyone wants to know. Who is it? Who are they? What's their volume? What's their revenue and everything? So it is difficult. I think you've managed it well, and I think you're at an inflection point here now with C1 having achieved recognition. And that recognition, I believe, is going to spread like wildfire, especially with the COVID-19 occurring and now people looking at pandemics, epidemics, flu and other things. So I think we're in the right place at the right time with a company that's experienced in the space with a significant asset that's proven in C1. Our risk as shareholders are twofold. One, is management going to deliver? Well, you've proven that already. So that's not a risk. Two, can C1 deliver on the promise of…

Matt, do you want to take that?

Well, it's a very nice question. And I think what I'll say to that is you sort of slightly summarized it well for us. We recognize the opportunity in front of us. We also are frustrated we can't tell the world about other things that we're doing, but that's part of the game. In the end, that's actually to our benefit, probably, because we can actually make sure that we get deeper into those relationships without the world asking lots of questions. So that's okay. But yes, I think the WuXi announcement and others that we've had so far are testament to the R&D strength the company has, led by Roland; the way in which we manage our books very carefully, led by Ping. And I think Mark doesn't need any explain -- don't know if he was asked, but you know. But I think he does work very hard. I think he's the driver behind all of this. So the right people are here. I think, though, we have a lot more to do. We have actually a lot more to do. We're just starting to, I think, announce names like WuXi and we, of course, would like to announce a lot more. So as this year plays out, we're going to be focused on delivering excellent data back to those partnerships. That's what we have to do first, while we're also putting down more collaborations and partnerships, which we are doing all the time. And of course, we hope to announce more of those where we can. But I'm not really answering your question, but I just want to say a thank you to the way you asked the question and perhaps just pass back to you, Mark.

No. I think the bottom line is that we have a very powerful engine, and we can tune it up and if we tune it up with people like WuXi or the other companies we're dealing with to meet their needs and their demands, the world's your oyster. Put a piece sand in it, and you get a pearl. How many pearls do you want? What color do you want? What type do you want? We're at the mercy of what the sequence that they give us. Is that sequence going to be a multibillion-dollar blockbuster drug like a KEYTRUDA or another PD-1? Well, you can bet they're going to come at some point. So really, to us, it's time and money, and we have to manage the money and speed the time up, and that's what we're doing. And the science is going to get better and better and better all the time and, hopefully, with everyone else's money. Okay. So that's the goal.

Our next question is coming from Robert Smith from Center for Performance Investing.

So could you give me an idea, Mark, about the position of the Israel Institute in that country alongside other efforts that are going on? I think several days ago, I saw that another group had already kind of validated a vaccine candidate. And I'm not particularly clear as to the relationship with the defense ministry there or authority. Is there anything like a BARDA here? Or maybe you can give me an idea of what's going on in relationship to other efforts like the Weizmann Institute or Technion or groups that are working in Israel as well? I mean, where is the position of the Israel Institute, in your opinion?

Well, let me let answer -- Ronen has it because he's Israeli, living in Budapest, and he grew up in Israel, and the attended those universities. So Ronen, you want to take that question?

Yes. I think the Israel Institute of Biologic Research is a very important institute in Israel. They do good science. And one of the great mission is to really protect the Israelis from all kind of threats, biological threats and beyond. And therefore, they have great scientists there, and they have relation -- very good relation with all the Israeli university and also with Weizmann Institute. And so I think they're really sitting in a very good position in terms of being -- having access to any Israeli resources they need, and they're being really heavily supported by the Israeli government. I don't know more than that, but I think it's -- I don't know. If you ask us to compare their position to BARDA, I really don't -- I never thought about to do the comparison, but I think there are some similarities. But obviously, I think the most important thing with this institute is very well supported by the Israeli government. And they give them all the access to any research and resources that they need. I hope that answered your question.

Well, I think that one difference is the Israel Institute of Biologic Research is actually carrying out the research, not just funding money. They're scientists, they are doing the work. And I don't know if BARDA does that for the BARDA I know doesn't do that. And I know a lot of people at BARDA, and I've known them for several years, and I've been in discussions with BARDA on a constant basis about exactly this point, that we think C1 is a much better platform than the baculovirus platform that they're using with the flu and with the Sanofi and their -- BARDA's for the defense, coronavirus. I think it's a much better platform than the PERSEUS 6 cell line that the J&J guys are going to be using. But big pharma has a lot of clout. But people have checkbooks, we got the technology. People just have to recognize that we want to put this in the hands of people to win. We need to save lives, and we need to do it sooner than later, and we're going to need to do it affordably. And those other technologies really aren't going to be making things affordably, and we're going to end up with the same problem we have now with diagnostics and masks, and nobody is going to have access. It's just almost insane if you think about it. We haven't learned from this whole episode. But they're starting to open their eyes up. And to be honest with you, the people at BARDA, FDA, NIH, HHS, they're all very good. They're all smart. They are looking at, believe me, what's out there, including C1, and hopefully, they'll make the right decisions. And I think they will. They get what we have, and it's just a matter of finding the home and the right place for it.

Okay. And just a second question. What do you expect your burn rate to be in 2020?

Well, that's a good question. And basically, I know we gave guidance last year on our expected cash burn in the past. However, given the unprecedented times we're all experiencing, we anticipate being able to address that question later in the year. But we have plenty of cash for many, many years. So it's really not even relevant. It's what opportunities are there in front of us. And in every 2 months from now, we don't know what's going to be there. I mean the coronavirus was an opportunity that just crept up on us, and we're exploiting it. But we have plenty of money for many, many years if nothing happens, let alone if good things happen. But we'll give guidance later in the year when we get a better feel. You've got to also remember, we don't know what interest rates we're going to get on our bonds. It's changing daily so we're recalculating what our expectations were.

Our next question today is coming from Lee Alper from Hammock Investors [ph].

A couple of questions. One, on the glycoengineering, you've announced on your products, you've announced a certain percentage that you've made. How much of a percentage do you have to get to, to be able to prove what you want to prove? Or are you there now? And then I'll do a follow-up.

I'll let Ronen answer that so it's more accurate. Ronen, you still awake?

Sorry, I was on mute. I'm sorry. Yes, I think in terms of the percentage, we are actually reaching the target and in terms of at least what we have developed so far, as we say, G0 and the G1, G2. However, what we are really working on now to make this the basic strain, like plug-and-plays, so every protein that we would like to express, we can produce it in a plug-and-plays way to get the right glyco structure with the right productivity. And this is the opportunity we are working now.

Okay. And the one thing that I see missing is that there's no insider buying. Are you in a constant quiet period because you're in so many negotiations? Or there's just no buying going on?

Well, first of all, we bought $22 million of our own stock back before, number one...

No, I understand. But I'm talking about the officers.

Well, number one, you can bet we've been in a quiet period for a long time. And I think because of -- because I think we're in a quiet period until sometime in May. Even if nothing was happening because as we're so close on March 30, we're a late reporter as a small company. And Ping, you can correct me if I'm not mistaken, but...

I think you're right. Yes, I think our blackout won't lift up until after the first quarter's earnings call, which likely in May, mid-May.

And for example, the other day, I mean, we were getting called out, "Why don't you buy shares? Why don't you buy shares? It's so cheap." And we would love to be able to potentially buy shares, but we couldn't. And in my case, I already own, between me and the kids' trust, almost 8 million to 10 million shares. So I'd say I'm drinking a lot of Kool-Aid.

There's no question you are, Mark. I was just wondering about the other Board members or officers.

I think other Board -- first of all, you got to remember, some of the officers like -- they have children, they have weddings, they have to live. Ronen actually sold some of his shares last year, not because he didn't believe what we're doing but because he's a scientist and he has to diversify. And so I don't think that's the case at all. I wouldn't judge by whether somebody buys or sells puts a 10b2 plan in place. I think you just pay attention to the business. It isn't that people know things that you don't know. Of course, we do. We're certainly in blackout periods. We, of course, knew we're going to sign a deal with WuXi before you knew. We knew we're going to do a top 3 animal health company before you knew. We knew we're working on a bunch of coronavirus opportunities and still are as well as other opportunities. So we're almost always in a blackout period because of the size we are. But there are people that I know that some of the Board members have asked at certain times because they buy shares. So I wouldn't take it as a signal. I know Wall Street thinks that's a signal, but I don't believe it's good or bad. It's just people have different needs at different times and then different diversification.

Okay. One final question. On ZAPI, at what point will someone -- or do you anticipate someone has to act either to accept what you have and enter into a deal as opposed to just doing another further evaluation? Or will they -- or do they walk away?

Yes. Well, ZAPI is not a company, ZAPI is a consortium. Inside of ZAPI, there are a couple of companies and a lot of universities. And you can look -- go online and type Dyadic and ZAPI, and you'll see who is in it. Publicly, it shows Boehringer Ingelheim and AstraZeneca. So you can probably bet that one or more of those companies has been looking at C1 and maybe doing additional research on their own outside of ZAPI. Though we expect some company and maybe one or more of them to step up at some point, not only fund research because they may be doing that but potentially to take a license in an upfront access with cash or maybe even more. So it's very hard to tell. But ZAPI itself is a government funding agency sponsored by the government. And by giving us two more proteins, it's -- they have two more proteins that they want to see the diversity, and then the people in the institute that are involved can see what's going on. But ZAPI can't buy anything. They can just fund research.

We've reached the end of our question-and-answer session. I'd like to turn the floor back over for any further or closing comments.

Okay. So I would want to thank everybody for joining us on tonight's call. We appreciate everybody's support. We've really been working hard here, night and day, burning the midnight oil, and we wish everybody a safe and "stay out of harm's way" approach. And I would stay away from other people, 6 feet away, and social distancing is a good idea. And we're doing that here at Dyadic as well. So thank you all for the wonderful kudos tonight. But more importantly, let's all work together at solving the problems that we're facing today as a nation and the world. Good night.

Thank you. That does conclude today's teleconference. You may disconnect your line at this time, and have a wonderful day. We thank you for your participation today.