Recursion Pharmaceuticals, Inc. Q2 FY2025 earnings call

• Recursion OS 2.0: Integrated elements from Exscientia, combining AI-powered biological insights, precision design of molecules, and clinical development components. • Boltz-2: Partnership with MIT and Nvidia, open-sourced with nearly 200,000 downloads and 50,000 unique users, enabling efficient protein ligand binding predictions with 1,000-fold less compute than traditional methods. • ClinTech platform: Deployed across programs, including causal AI for human genomics, clinical trial design and simulation, and faster enrollment/trial activation (50% faster enrollment projections at high-quality sites). • Internal programs: Progress on oncology and rare disease programs like CDK7, RBM39, FAP, MALT1, etc. • Partnerships: Collaborations with Roche, Sanofi, Bayer, and Merck KgAa, with milestones achieved in partnerships like Sanofi.

No traditional product segment financials were discussed. The focus was on the Recursion OS 2.0, including AI-powered biological insights, precision design, and clinical development components. Key initiatives like Boltz-2 (a partnership with MIT and Nvidia for protein folding and ligand binding predictions) and the ClinTech platform deployment across programs were highlighted.

• Cash balance: $533 million in cash at the end of Q2 2025. • Partnership inflows: Projected over $100 million in partnership inflows by the end of 2026. • Cash burn: Expected cash burn below $390 million in 2026. • Cash runway: Expected cash runway through the fourth quarter of 2027, based on managing expenses and partner inflows.

No specific risks were explicitly detailed in the transcript, but potential risks could include execution risks related to achieving program milestones, delivering on partnerships, and market competition in the biotech space.

Q: Is Boltz-2 the initiative with a major partner on foundational protein structure modeling that was mentioned at JPM earlier this year?

A: Yes. This is the partnership alluded to at JPMorgan.

Q: Why open source Boltz-2 versus keeping it internal?

A: Believed that commoditizing the technology in areas where there are many competitive partners working in the space is beneficial, while keeping proprietary tools where a differentiated advantage exists.

Q: Are you still building proprietary models?

A: Absolutely, leveraging Boltz-2 models and internal data sets for proprietary advantages.

Q: For the CDK7 combo expansion cohort in ovarian cancer, what standard of care are you allowing in the trial and what level of efficacy did they show?

A: Standard of care includes single-agent chemotherapy plus beva; median PFS was about 6.7 months and median OS was 14 to 22 months.

Q: For the upcoming FAP data, where do you see the threshold for success?

A: Looking for meaningful improvement in polyburden reduction, with need to have conversations with regulators post-data.

Q: What visibility do you have on the potential $100 million in milestones by 2026?

A: It's a probability-weighted estimate, not including new business development or additional expansion on unidentifed programs.

Q: How do you get to the guidance of Q4 2027 cash outlook?

A: Focus on cash flow statement, operating expenses excluding partner inflows, with confidence in achieving through existing strategies of efficient expense management and executing on partnerships.

Q: How is Recursion tripling down on compute and transformative initiatives?

A: Focus on virtual cell development, a Frontier Research Group working on high-risk high-reward areas including agents for drug discovery, and leveraging multi-layered data (patient, pathway, protein folding) to drive advancements.