Codexis, Inc. (NASDAQ: CDXS)

Codexis, Inc. is a leading provider of technology solutions to improve therapeutics manufacturing. The company focuses on impacting the manufacturing process by using its proprietary CodeEvolver directed evolution technology platform to discover, develop, enhance, and commercialize novel high performance enzymes and other classes of proteins. Enzymes are naturally occurring biological molecules that can be precisely engineered for specific functions and to survive environments where natural enzymes cannot or to perform biochemical transformations different from those for which they evolved. Codexis applies its technology and expertise to enhance enzyme properties and drive pivotal improvements in manufacturing of complex therapeutics across two key areas: the ECO synthesis manufacturing platform and the small molecule pharma biocatalysis business.

Codexis generates revenue primarily through the sale of engineered enzymes as biocatalysts, contract development and manufacturing services for its ECO synthesis platform, and licensing of its CodeEvolver technology platform. Revenue streams include upfront payments, milestone payments, payments for screening and enzyme engineering, fees for manufacturing scale up and supply of enzymes, licensing fees, and royalties based on product commercialization. The company also earns income from research and development collaborations, supply agreements, and the sale of enzymes for both commercial scale and clinical stage manufacturing. Additionally, Codexis receives revenue from partnerships with contract development and manufacturing organizations that aim to evaluate and scale its ECO synthesis offerings for RNAi therapeutics.

The company operates through the following segments:

• ECO Synthesis Manufacturing Platform: This segment provides enzymatic tools and processes designed to enable large scale manufacture of RNA interference therapeutics including siRNA molecules.

• Small Molecule Pharma Biocatalysis: This segment develops optimized enzymes that are used by pharmaceutical companies to improve the efficiency and productivity of their manufacturing processes for small molecule therapeutics.

Codexis holds a strong position in the enzyme engineering market due to its proprietary CodeEvolver platform that combines machine learning with directed evolution to create high performance biocatalysts. In the ECO synthesis space the company competes with the established chemical phosphoramidite method used by contract manufacturing organizations such as Agilent Technologies and with early stage efforts like EnPlusOne Biosciences and the UK based consortium led by the Centre for Process Innovation that includes academic partners and large pharma firms such as AstraZeneca and Novartis. In the small molecule biocatalysis arena Codexis faces competition from traditional chemical catalyst providers including Solvias AG, BASF, Johnson Matthey and Takasago International Corporation as well as from industrial enzyme companies like DSM Firmenich, Cambrex, Lonza, WuXi STA and Almac Group and from specialized biocatalyst firms such as BRAIN, evoxx technologies, c LEcta, Enzymicals and Enzymaster. The company's competitive advantage stems from its ability to tailor enzymes for specific reactions, delivering higher yields, greater purity, lower energy use and reduced waste, which translates into lower operating costs and a more sustainable manufacturing process for its customers.

The company serves a diverse customer base that includes large pharmaceutical companies, contract development and manufacturing organizations, and biotechnology firms. Specific partners and licensees include GlaxoSmithKline Intellectual Property Development Limited, Merck & Co Inc., Novartis Pharma AG, Pfizer Inc., Alphazyme LLC, Aldevron LLC, seqWell Inc., Molecular Assemblies Inc., Maravai LifeSciences Inc., and Nestlé Health Science. In addition, Codexis works with unnamed major customers that represent a significant portion of its revenue and accounts receivable, and it collaborates with several contract development and manufacturing organizations to advance its ECO synthesis platform for RNAi therapeutics.