Recursion Provides Business Updates and Reports Fourth Quarter and Fiscal Year 2024 Financial Results

   -- Reported promising safety and preliminary efficacy data for REC-617, an 
      oral CDK7 inhibitor, and met primary endpoints and demonstrated 
      encouraging trends in efficacy for REC-994 in cerebral cavernous 
      malformations 
 
   -- Advanced three new clinical studies across oncology, rare disease, and 
      recurrent C. diff infection with REC-1245, REC-4881, and REC-3964 
 
   -- Delivered milestones for partners including the first neuro-phenomap for 
      Roche and Genentech and two milestones for Sanofi for aggregate cash 
      inflows of $45 million 
 
   -- Completed business combination with Exscientia, cementing a position as a 
      leading TechBio company 

SALT LAKE CITY, Feb. 28, 2025 (GLOBE NEWSWIRE) -- Recursion (Nasdaq: RXRX) a leading clinical stage TechBio company decoding biology to radically improve lives, today reported business updates and financial results for its fourth quarter and fiscal year ended December 31, 2024.

Recursion will host a (L)earnings Call on February 28, 2025 at 8:30 am ET / 6:30 am MT / 1:30 pm GMT from Recursion's X (formerly Twitter), LinkedIn, and YouTube accounts giving analysts, investors, and the public the opportunity to ask questions of the company by submitting questions here: https://bit.ly/40UiVkb.

"In 2024, Recursion made a transformative leap with the largest TechBio merger in history, combining our pipeline, partnerships, people and platform to further accelerate the Recursion OS as the leading full-stack TechBio platform," said Chris Gibson, Ph.D., Co-Founder and CEO of Recursion. "With a portfolio of 10 clinical and preclinical programs, including both potential first-in-class and best-in-class therapies, we are driving towards faster and more effective drug development. These advances position us at the forefront of the next generation of medicine, where the impact will be measured not just in scientific breakthroughs through the power of our platform, but in real-world patient outcomes at scale."

(1) Includes preclinical programs (programs expected to enter the clinic within the next 18 months); (2) (Program milestones includes data readouts, preliminary data updates, regulatory submissions, trial initiation, etc.)

Summary of Business Highlights

Pipeline

   -- Clinical Results: Recursion demonstrated promising early efficacy data 
      for two programs in 2024 
 
          -- REC-617: A potential best-in-class CDK7 inhibitor optimized using 
             our AI platform, delivered early Phase 1/2 results demonstrating 
             promising safety and efficacy, including a durable partial 
             response in a late-stage metastatic ovarian cancer patient and 
             stable disease across four other patients with solid tumors (e.g. 
             CRC, NSCLC). These findings support further clinical development 
             as the Company continues to explore its potential in combination 
             regimens. 
 
          -- REC-994: A potential first-in-disease oral superoxide scavenger 
             for symptomatic CCM, showing robust safety in chronic dosing in a 
             Phase 2 study as well as a reduction in lesion volume as measured 
             by MRI and trends towards symptom stabilization as evaluated by 
             mRS. The data was featured in a late-breaking oral presentation at 
             the 2025 International Stroke Conference. Next steps in this 
             program will be informed by regulatory discussions and long-term 
             extension data expected in 2025. 
 
   -- Clinical Advancements and Regulatory Milestones: 
 
          -- Pipeline advanced with the initiation of three new clinical 
             studies: 
 
                 -- DAHLIA: Phase 1/2 trial investigating REC-1245, a potential 
                    first-in-class RBM39 degrader, in biomarker-enriched 
                    advanced solid tumors and lymphoma. 
 
                 -- TUPELO: Phase 1b/2 trial investigating REC-4881 for 
                    familial adenomatous polyposis (FAP). 
 
                 -- ALDER: Phase 2 trial investigating REC-3964, a potential 
                    first-in-class C. diff toxin B inhibitor, for preventing 
                    recurrent C. difficile infection. 
 
          -- Progressed additional programs: 
 
                 -- REC-4539: received IND clearance for REC-4539 (LSD1 
                    inhibitor) in small cell lung cancer 
 
                 -- REC-3565: received CTA approval for REC-3565 (MALT1 
                    inhibitor) in b-cell malignancies 
 
                 -- REC-4209: progressed REC-4209 in idiopathic pulmonary 
                    fibrosis to IND-enabling studies 

Partnerships

   -- Roche-Genentech: 
 
          -- Gastrointestinal-Oncology Advancements: In partnership with Roche 
             and Genentech, Recursion has generated multiple whole-genome 
             phenomaps with chemical perturbations across various 
             disease-relevant cell types, enabling deeper insights into how 
             different cellular contexts respond to gene knockouts and 
             chemicals. 
 
          -- Neuro-specific CRISPR KO Phenomap: In partnership with Roche and 
             Genentech, Recursion developed the first whole-genome CRISPR 
             knockout map in neural iPSC cells, providing valuable data to 
             identify potential new targets in neuroscience, a field which has 
             historically suffered from limited new discoveries. 
 
          -- Milestones and Collaboration: The neuroscience phenomap work led 
             to the exercise of a $30M option by Roche and Genentech in August 
             2024, and the collaboration is already moving forward with target 
             validation projects. 
 
   -- Sanofi: 
 
          -- Immunology & Oncology Achievements: Through this collaboration, 
             Recursion is using its end-to-end integrated platform to discover 
             and advance up to 15 novel targets in the oncology and immunology 
             therapeutic areas. 
 
                 -- In 2024, two programs advanced through initial milestones, 
                    generating $15M in aggregate payments from Sanofi. 
 
   -- Bayer: 
 
          -- Oncology Achievements: Completed 25 multimodal oncology data 
             packages utilizing the Recursion OS platform. Multiple programs 
             are rapidly progressing to Lead Series nomination. 
 
          -- LOWE: Additionally, Bayer has adopted Recursion's LOWE 
             LLM-orchestrated workflow software to enhance their research 
             capabilities. 
 
   -- Merck KGaA (Darmstadt, Germany): 
 
          -- Ongoing alliance with Merck KGaA, Darmstadt, Germany is focused on 
             leveraging Recursion's discovery engine to identify first-in-class 
             and best-in-class targets across oncology and immunology, driving 
             innovation in these key therapeutic areas. 

Platform

   --  Full stack AI powered platform: Our constantly-evolving Recursion OS 
      spans target discovery through clinical development, enabling efficient 
      molecule design and testing for both first and best-in-class 
      opportunities. 
 
          -- Integration of Exscientia's Precision Chemistry Platform (Centaur) 
             & Recursion OS: 
 
                 -- Integrated Centaur into more than 10 design cycles for 
                    programs Recursion has previously partnered, with early 
                    validation work achieved and progress accelerating across 
                    multiple additional partnered programs. 
 
                 -- The Recursion OS has been used to identify hit compounds in 
                    7 immune-relevant targets or dual target pairs and early 
                    validation work has commenced to prepare reports for our 
                    partners. 
 
                 -- Recursion's AI synthesis planning capability shows a 25% 
                    improved tractability assessment of AI-generated compounds 
                    over competitors. 
 
          -- Compute: Launched BioHive-2, the most powerful supercomputer owned 
             by any biopharma company, enabling the training of 
             industry-leading foundation models like Phenom-2, MolPhenix, and 
             MolGPS. 
 
          -- Protein Target Data Layer: Mapped 1.4 million active ligands to 
             binding pockets for structure-based drug discovery and target 
             deconvolution. 
 
          -- Phenomics: Scaled phenomics experimental capabilities can now 
             generate up to 16.2 (135 terabytes) million multi-timepoint 
             brightfield images across up to 2.2 million experiments per week. 
 
          -- Transcriptomics: Generated >1.6M individual transcriptomes since 
             its launch in 2023, with just under 1M generated in 2024 including 
             building the world's first genome-scale CRISPR knockout map in 
             primary human cells. 
 
          -- InVivomics: Grew dataset to 1 million hours of video; 1 million 
             hours of digital biomarkers and 149,000 environment data points. 
 
          -- LLM and Knowledge Graph Integration: Reduced manual effort by 60% 
             for evidence collection for hit nomination packages supporting 
             entry into hit-to-lead, through knowledge graphs and LLM-based 
             data aggregation with further reduction expected with additional 
             data layers. 
 
   -- Breakthroughs in Foundation Models: Developed multimodal AI models like 
      Phenom, MolPhenix, and MolGPS that accelerate Recursion's ability to make 
      high-confidence predictions in our therapeutics programs. 
 
          -- Phenom-2: A 1.9B-parameter model trained on 8B microscopy images, 
             achieving 60% better linear separability of genetic perturbations 
             and top performance in biological relationship recall and 

             consistency. 
 
          -- MolPhenix: Delivers a 10X improvement over previous models in 
             predicting the effects of molecules on cell assays and morphology. 
 
          -- MolGPS: A 3B-parameter model for molecular property prediction 
             that outperforms the state of the art on 12 of 22 ADMET tasks in 
             the Therapeutic data commons $(TDC)$. 
 
          -- MolE: A new foundation model trained on 842M molecular graphs, 
             surpassing earlier approaches by ranking first in 10 ADMET tasks 
             in the TDC. 
   -- Advancement in Causal AI Models & Emerging Focus on ClinTech: 
      Transforming clinical development with Recursion's ClinTech platform and 
      models, focused on: 
 
          -- Utilizing AI models and Tempus data to build a patient 
             stratification framework in small cell lung cancer (SCLC). This 
             work is informing clinical strategies for the planned REC-4539 
             Phase I study commencing in the first half of 2025. 
 
          -- Automating key processes like site engagement and enrollment to 
             accelerate patient matching and industrializing workflows to 
             accelerate trial initiation. 
 
          -- Centralizing data systems to optimize clinical protocols, 
             streamline operations, and significantly reduce costs and site 
             burden. 

Integration & Additional Corporate Updates

   -- Recursion completed the combination with Exscientia, becoming an 
      industry-leading TechBio company, bringing together Recursion's 
      biology-first TechBio platform with Exscientia's chemistry-first TechBio 
      platform, and creating a compelling set of both first and best-in-class 
      clinical programs and sector-leading partnerships. 
 
   -- Recursion announced it will carve out its Austrian operations into a 
      newly formed company, Alpha Biotechnology GmbH ("Alpha"). Recursion will 
      have a 49% ownership in Alpha, a company leveraging a patient-tissue 
      platform for the development of precision therapeutics for the treatment 
      of hematological and solid cancers, while focusing its efforts and 
      moderating spend. 
 
   -- The company is on-track to sub-lease or otherwise simplify its real 
      estate footprint post business combination to concentrate employees in a 
      smaller number of sites while moderating spend. 
 
   -- Recursion is maintaining its guidance of at least $100 million in 
      synergies from the transaction, with a majority of the run rate amount 
      achieved in 2025. 
 
   -- The company will provide a comprehensive update in May 2025. 

Fourth Quarter and Fiscal Year 2024 Financial Results

Financials reported for the full year 2024 include full year Recursion financials combined with financials from Exscientia post-business combination (November 20-December 31, 2024).

   -- Cash Position: Cash, cash equivalents and restricted cash were $603.0 
      million as of December 31, 2024, compared to $401.4 million as of 
      December 31, 2023. On a combined basis, Recursion continues to expect 
      cash runway to extend into 2027. 
 
   -- Revenue: Total revenue, consisting primarily of revenue from 
      collaborative agreements, was $4.5 million for the fourth quarter of 
      2024, compared to $10.9 million for the fourth quarter of 2023. Total 
      revenue, consisting primarily of revenue from collaboration agreements, 
      was $58.8 million for the year ended December 31, 2024, compared to $44.6 
      million for the year ended December 31, 2023. For the fourth quarter of 
      2024, the decrease of $6.4 million compared to the prior period was due 
      to the timing of projects from the Company's Roche and Genentech 
      collaboration. For the year ended December 31, 2024 the increase of $14.3 
      million compared to the prior year was due to revenue recognized from our 
      Roche and Genentech collaboration related to the completion of 
      Recursion's first neuroscience phenomap optioned by Roche and Genentech 
      for $30 million. 
 
   -- Pro Forma Revenue: The Company's unaudited pro forma consolidated revenue 
      is presented as if the Exscientia business combination had occurred on 
      January 1, 2023. Pro forma revenue was $82.6 million for the year ended 
      December 31, 2024, compared to $72.5 million for the year ended December 
      31, 2023. 
 
   -- Research and Development Expenses: Research and development expenses were 
      $98.3 million for the fourth quarter of 2024, compared to $69.5 million 
      for the fourth quarter of 2023. Research and development expenses were 
      $314.4 million for the year ended December 31, 2024, compared to $241.2 
      million for the year ended December 31, 2023. The increase in 2024 
      research and development expenses compared to the prior year was driven 
      by our platform and personnel costs as the Company continues to expand 
      and upgrade its platform, including chemical technology, machine learning 
      and transcriptomics platform. 
 
   -- General and Administrative Expenses: General and administrative expenses 
      were $77.2 million for the fourth quarter of 2024 compared to $30.5 
      million for the fourth quarter of 2023. General and administrative 
      expenses were $178.2 million for the year ended December 31, 2024, 
      compared to $110.8 million for the year ended December 31, 2023. The 
      increase in 2024 general and administrative expenses compared to the 
      prior year was primarily driven by an increase in salaries and wages of 
      $21.1 million, transaction costs of $20.5 million, inclusion of 
      Exscientia's results of $11.3 million and increases in software and lease 
      expenses. 
 
   -- Net Loss: Net loss was $178.9 million for the fourth quarter of 2024, 
      compared to a net loss of $93.0 million for the fourth quarter of 2023. 
      Net loss was $463.7 million for the year ended December 31, 2024, 
      compared to a net loss of $328.1 million for the year ended December 31, 
      2023. 
 
   -- Net Cash: Net cash used in operating activities was $115.4 million for 
      the fourth quarter of 2024, compared to net cash used in operating 
      activities of $74.1 million for the fourth quarter of 2023. Net cash used 
      in operating activities was $359.2 million for the year ended December 
      31, 2024, compared to net cash used in operating activities of $287.8 
      million for the year ended December 31, 2023. The difference was 
      primarily driven by (1) higher costs incurred for research and 
      development and general and administrative due to Recursion's expansion 
      and upgraded capabilities and (2) Recursion's combination with 
      Exscientia. 
 
          -- Recursion noted that the change in Exscientia's cash and cash 
             equivalents and short term bank deposits from December 31, 2023 to 
             November 20, 2024, the date of the close of the acquisition was 
             $184 million. There were no material financings in this period1: 
 
(in thousands)     November 20, 2024    December 31, 2023         Change 
----------------  -------------------  -------------------  ------------ 
Cash and cash 
 equivalents        $         277,104     GBP      259,463 
Short term bank 
 deposits                           -              103,586 
Total - GBP                       N/A     GBP      363,049 
GBP to USD rate                   N/A                 1.27 
----------------  -------------------  ------  -----------   -------- 
Total - USD         $         277,104       $      461,072  $(183,968) 
 
 

1 December 31, 2023 amounts from the above table are from Exscientia's 20-F Annual Filing. Recursion noted that Exscientia reported its results using International Financial Reporting Standards (IFRS) but that there are no IFRS to U.S. GAAP differences that would impact the measurement of Exscientia's December 31, 2023 cash and cash equivalents and short term bank deposits amounts. Recursion believes this information helps provide additional information on Exscientia's liquidity prior and up-to the acquisition and a more complete understanding of the Company's liquidity, facilitating analysis of the Company's results.

About Recursion

Recursion $(RXRX)$ is a clinical stage TechBio company leading the space by decoding biology to radically improve lives. Enabling its mission is the Recursion OS, a platform built across diverse technologies that continuously generate one of the world's largest proprietary biological and chemical datasets. Recursion leverages sophisticated machine-learning algorithms to distill from its dataset a collection of trillions of searchable relationships across biology and chemistry unconstrained by human bias. By commanding massive experimental scale -- up to millions of wet lab experiments weekly -- and massive computational scale -- owning and operating one of the most powerful supercomputers in the world, Recursion is uniting technology, biology and chemistry to advance the future of medicine.

Recursion is headquartered in Salt Lake City, where it is a founding member of BioHive, the Utah life sciences industry collective. Recursion also has offices in Toronto, Montréal, New York, London, Oxford area, and the San Francisco Bay area. Learn more at www.Recursion.com, or connect on X (formerly Twitter) and LinkedIn.

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