Ginkgo Bioworks Holdings, Inc. (NYSE:DNA) Q4 2022 Earnings Call Transcript

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Jason Kelly: No, that’s right. Yes, I would say, in general, the ’23 focus is on efficiency and effectiveness of the platform. In other words, trying not to spend a lot of expansion, but you will see us do some targeted moves, as Mark saying, particularly in biopharma we could use more mammalian capacity. And again, the testing about our platform is it’s not really organized that way, it’s not exactly like just purely dedicated like only works from but like there are certain functions in the foundry that are more heavily weighted that way. So we would want to invest more there. But other functions synthesis and so on, construction, a lot of our assays and analytics. That’s not really specific to any particular market. So there, we can adjust without having to build new stuff.

Unidentified Participant: Great. Thank you.

Anna Marie Wagner: All right. Mark from BTIG. I’ve opened your line, if you want to unmute, you are welcome to ask your questions.

Mark Massaro: Terrific. Maybe just a question on Zymergen you completed that acquisition last year. What do you believe to be the core capabilities that you’re porting over as we think about 2023 and 2024? Just curious if you’re planning to deploy the reconfigurable automation cards or the racks. And then any status on the real estate in California.

Jason Kelly: So I’ll speak to the racks and someone else can chime in on the latest on the real estate. Yes is the answer. I’m extremely excited. You can ask people I can go because I put it in our Slack channels all the time, when will the rack show up in here in Boston. Yes. So we’re extremely excited about that flexible automation. Also, the software infrastructure and team at Zymergen is a real gift in terms of speeding up our ability to drive that efficiency and effectiveness of the platform next year, both like just the literal assets and the quick integration of the teams to develop new things. But they also just ran into many of the same challenges we have run into over the last five to 10 years. And we sold some — they’ve sold some and being able to put them together now as one team is a real speed up.

And so it is high integration on the platform side. As we mentioned during the whole acquisition on the product side Ginkgo is not a product company. So we’re still looking for homes for various of the products and so on, hoping news on that in the future. But the platform integration is aggressive and working well. And Mark, I don’t know if you want to speak to the…

Mark Dmytruk: Yes. On the real estate, we did sublease 1 facility in the fourth quarter, and we are, of course, evaluating all the options with respect to the real estate there. And so that very much — it’s sort of what I would call it a very active exploratory phase right now.

Mark Massaro: Okay. That’s helpful. One for you, Jason. Kind of a bigger picture question on code based I think you leverage over 2 billion proprietary protein sequences. You’ve called out Bayer as one of the folks that’s evaluating this, I believe. How should we think about this asset evolving and perhaps turning into a commercial engine? When do you think we might hear when and how much you can monetize code-base?

Jason Kelly: Okay. Yeah. So this is a great question. So first off, like think about what we do for a customer, right? Because we’re coming in, they want to sell a program to do something. That means they don’t have it working right now. They need a new thing, all right? And so there’s going to need to be some lab work done — and in particular, we need to change the genome of that cell and test whether that change did the thing the customer wanted, all right? So one answer is try a lot of designs informed by our design software and so on. A thing that can save you a lot of work is if we have done something similar to what you were asking for. And so we have a lot of intuition about what the best designs will be, okay? And we see this.

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