AXIN1

Multiple clinical programs from Recursion’s first generation platform are on track to read out Phase 2 data in H2 2024 and H1 2025 with additional second generation programs approaching IND in the near-term In-licensed a program (Target Epsilon) that emerged from our fibrosis collaboration with Bayer that represents a novel approach to treating fibrotic diseases - now entering IND-enabling studies Already incorporating causal AI models into the Recursion OS trained using data from Tempus after a mid-Q4 data partnership announced SALT LAKE CITY, Feb. 27, 2024 (GLOBE NEWSWIRE) -- Recursion (Nasdaq: RXRX), a leading clinical stage TechBio company decoding biology to industrialize drug discovery, today reported business updates and financial results for its fourth quarter and fiscal year ending December 31, 2023. “2023 was a year of remarkable progress for Recursion as we continued to demonstrate how combining technology, biology, chemistry, and patient data can industrialize drug discovery, and we look forward to the milestones ahead of us in 2024,” said Chris Gibson, Ph.D., Co-founder and CEO of Recursion. “As we have watched the dynamics of our landscape, it appears that BioTech is increasingly evolving into TechBio, where it is imperative for life science companies to embrace digital nativity similar to how SaaS companies 10+ years ago evolved to being cloud-native in order to thrive. In this data-driven age, we believe the most important differentiator will be connected data in order to increasingly understand and treat the complexities of human disease. Recursion plans to continue leading the field in terms of data generation and aggregation.” Summary of Business Highlights Platform Causal AI Modeling and Additional Datasets: We have been training causal AI models leveraging over 20 petabytes of multimodal precision oncology patient data from Tempus to support the discovery of potential biomarker-enriched therapeutics at scale. By combining the forward genetics approach of Tempus with the reverse genetics approach at Recursion, we believe we have an opportunity to improve the speed, precision, and scale of therapeutic development in oncology. This work has already resulted in a directed-oncology program against a novel gene/disease relationship in a large oncology indication. Recursion intends to operate both as a data generator and multimodal data aggregator. In the future, we intend to augment our dataset and hone the Recursion OS with germline genetic data, organoid technologies, and automated nano-synthesis technologies. LOWE (Large Language Model-Orchestrated Workflow Engine): LOWE is an LLM agent that represents the next evolution of the Recursion OS. LOWE supports drug discovery programs by orchestrating complex wet and dry-lab workflows via natural language prompts. These workflows are the steps and tools available in the Recursion OS, from finding significant relationships across biology, chemistry, and patient-centric data to generating novel compounds and scheduling them for synthesis and experimentation. Through its natural language interface and interactive graphics, LOWE can put state-of-the-art AI tools into the hands of every drug discovery scientist. Pipeline Cerebral Cavernous Malformation (CCM) (REC-994): Our Phase 2 SYCAMORE clinical trial is a randomized, double-blind, placebo-controlled, safety, tolerability and exploratory efficacy study of REC-994 in participants with CCM. This trial was fully enrolled in June 2023 with 62 participants and the vast majority of participants who completed 12 months of treatment continue to elect to enter the long-term extension study. We expect to share Phase 2 data in Q3 2024. Neurofibromatosis Type 2 (NF2) (REC-2282): Our adaptive Phase 2/3 POPLAR clinical trial is a randomized, two part study of REC-2282 in participants with progressive NF2-mutated meningiomas. Part 1 of the study is ongoing and is exploring two doses of REC-2282 in approximately 23 adults and 9 adolescents, with enrollment in adults expected to complete in H1 2024. We expect to share Phase 2 safety and preliminary efficacy data in Q4 2024. Familial Adenomatous Polyposis (FAP) (REC-4881): Our Phase 1b/2 TUPELO clinical trial is an open label, multicenter, two part study of REC-4881 in participants with FAP. Part 1 is complete with FPI for Part 2 anticipated in H1 2024. We expect to share Phase 2 safety and preliminary efficacy data in H1 2025. AXIN1 or APC Mutant Cancers (REC-4881): Our Phase 2 LILAC clinical trial is an open label, multicenter study of REC-4881 in participants with unresectable, locally advanced or metastatic cancer with AXIN1 or APC mutations. This study was initiated at the end of 2023, with FPI anticipated in Q1 2024. We expect to share Phase 2 safety and preliminary efficacy data in H1 2025. Clostridioides difficile Infection (REC-3964): We conducted a Phase 1 healthy volunteer study to evaluate the safety, tolerability, and PK of REC-3964 at increasing oral doses in comparison with placebo. REC-3964 was safe and well tolerated and there were no serious adverse events, deaths, or TEAEs that led to discontinuation. REC-3964 is a first-in-class C. difficile toxin inhibitor and the first new chemical entity developed by Recursion, with promising preclinical efficacy data seen in relevant models (superiority versus bezlotoxumab). We expect to initiate a Phase 2 study in 2024. RBM39 HR-Proficient Ovarian Cancers and Other Solid Tumors: RBM39 is a novel CDK12-adjacent target identified by the Recursion OS. We intend to position our lead candidate as a single agent for the potential treatment of HR-proficient ovarian cancers and other HR-proficient solid tumors. As a result of our strategic collaboration with Tempus, we are leveraging genomic data across all tumor types to identify clinical biomarkers for patient expansion. We are advancing our lead candidate through IND-enabling studies with IND submission expected in H2 2024. Undisclosed Indication in Fibrosis (Target Epsilon): Phenotypic screening of human PBMCs identified novel and structurally diverse small molecules that reverse the phenotypic features of disease-state fibrocyte cells into those of healthy-state cells. The most promising compounds were confirmed as potent inhibitors of a novel target for fibrosis. This program originated under our initial fibrosis collaboration with Bayer and we have since in-licensed from Bayer all rights to this program which is now entering IND-enabling studies. Partnerships Transformational Collaborations: We continue to advance efforts to discover potential new therapeutics with our strategic partners in the areas of undruggable oncology (Bayer) as well as neuroscience and a single indication in gastrointestinal oncology (Roche-Genentech). In the near-term, there is the potential for option exercises associated with partnership programs, option exercises associated with map building initiatives or data sharing, and additional partnerships in large, intractable areas of biology or technological innovation. Enamine: In December 2023, we entered into a collaboration with Enamine to generate and design enriched compound libraries for the global drug discovery industry. By leveraging MatchMaker, a Recursion AI model, to identify compounds in the Enamine REAL Space (~36 billion chemical compounds) predicted to bind to high-value targets, we believe we can generate more powerful compound libraries for drug discovery purposes. Enamine may offer the resulting libraries to customers for purchase and will co-brand any libraries under both the Enamine and Recursion’s trademarks. This collaboration is an example of how select data layers can drive value in novel ways. Additional Corporate Updates Letter to Shareholders: Recursion Co-Founder & CEO Chris Gibson, Ph.D., wrote an annual letter to shareholders which may be found in the 10-K report. L(earnings) Call: Recursion will host a L(earnings) Call on February 27, 2024 at 5:00 pm Eastern Time / 3:00 pm Mountain Time. A L(earnings) Call is Recursion’s take on interacting with a broad public audience around notable business developments. Recursion will broadcast the live stream from Recursion’s X (formerly Twitter), LinkedIn and YouTube accounts and analysts, investors and the public will be able to ask questions of the company. Chief Business Operations Officer: In February 2024, Recursion named Kristen Rushton, M.B.A. as Chief Business Operations Officer. Ms. Rushton has worked at Recursion for over 6 years, previously serving as Senior Vice President of Business Operations. Prior to Recursion, Ms. Rushton worked at Myriad Genetics and Myrexis. Annual Shareholder Meeting: Recursion’s Annual Shareholder Meeting will be held on June 3, 2024 at 10:00 am Eastern Time / 8:00 am Mountain Time. Fourth Quarter and Fiscal Year 2023 Financial Results Cash Position: Cash and cash equivalents were $391.6 million as of December 31, 2023, compared to $549.9 million as of December 31, 2022. Revenue: Total revenue, consisting primarily of revenue from collaborative agreements, was $10.9 million for the fourth quarter of 2023, compared to $13.7 million for the fourth quarter of 2022. Total revenue, consisting primarily of revenue from collaboration agreements, was $44.6 million for the year ended December 31, 2023, compared to $39.8 million for the year ended December 31, 2022. For the fourth quarter of 2023, the decrease compared to the prior period was due to the timing of workflows from our strategic partnership with Roche-Genentech. For the year ended December 31, 2023 compared to the prior year, the increase was due to revenue recognized from our Roche-Genentech collaboration, which has progressed from primarily cell type evaluation work to inference based Phenomap building and additional cell type evaluation work. Research and Development Expenses: Research and development expenses were $69.5 million for the fourth quarter of 2023, compared to $44.0 million for the fourth quarter of 2022. Research and development expenses were $241.2 million for the year ended December 31, 2023, compared to $155.7 million for the year ended December 31, 2022. The increase in 2023 research and development expenses compared to the prior year was due to increased platform costs as we have expanded and upgraded our capabilities in platform including our chemical technology, machine learning and transcriptomics platform. General and Administrative Expenses: General and administrative expenses were $30.5 million for the fourth quarter of 2023 compared to $19.8 million for the fourth quarter of 2022. General and administrative expenses were $110.8 million for the year ended December 31, 2023, compared to $81.6 million for the year ended December 31, 2022. The increase in 2023 general and administrative expenses compared to the prior year was primarily driven by an increase in salaries and wages of $12.4 million and increases in legal, software and depreciation expense. Net Loss: Net loss was $93.0 million for the fourth quarter of 2023, compared to a net loss of $57.5 million for the fourth quarter of 2022. Net loss was $328.1 million for the year ended December 31, 2023, compared to a net loss of $239.5 million for the year ended December 31, 2022. Net Cash: Net cash used in operating activities was $74.1 million for the fourth quarter of 2023, compared to net cash used in operating activities of $44.7 million for the fourth quarter of 2022. Net cash used in operating activities was $287.8 million for the year ended December 31, 2023, compared to net cash used in operating activities of $83.5 million for the year ended December 31, 2022. The difference was primarily driven by a $150.0 million upfront payment from Roche-Genentech in early 2022 and an increase in operating expenses in 2023. About Recursion Recursion is a clinical stage TechBio company leading the space by decoding biology to industrialize drug discovery. Enabling its mission is the Recursion OS, a platform built across diverse technologies that continuously expands one of the world’s largest proprietary biological, chemical and patient-centric 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, chemistry and patient-centric data 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, Montreal and the San Francisco Bay Area. Learn more at , or connect on X (formerly Twitter) and LinkedIn. Media Contact Media@Recursion.com Investor Contact Investor@Recursion.com Consolidated Statements of Operations Recursion Pharmaceuticals, Inc. Consolidated Statements of Operations (unaudited) (in thousands, except share and per share amounts) Three months ended Years ended December 31, December 31, 2023 2022 2023 2022 Revenue Operating revenue 10,624 13,676 $ 43,876 $ 39,681 Grant revenue 267 — 699 162 Total revenue 10,891 13,676 44,575 39,843 Operating costs and expenses Cost of revenue 9,881 10,840 42,587 48,275 Research and development 69,482 43,980 241,226 155,696 General and administrative 30,458 19,838 110,822 81,599 Total operating costs and expenses 109,821 74,658 394,635 285,570 Loss from operations (98,930 ) (60,982 ) (350,060 ) (245,727 ) Other income (loss), net 4,306 3,490 17,932 6,251 Loss before income tax benefit (94,624 ) (57,492 ) (332,128 ) (239,476 ) Income tax benefit 1,628 $ — 4,062 $ — Net loss $ (92,996 ) $ (57,492 ) $ (328,066 ) $ (239,476 ) Per share data Net loss per share of Class A, B and Exchangeable common stock, basic and diluted $ (0.42 ) $ (0.31 ) $ (1.58 ) $ (1.36 ) Weighted-average shares (Class A, B and Exchangeable) outstanding, basic and diluted 233,158,161 185,669,683 207,853,702 175,537,487 Consolidated Balance Sheets Recursion Pharmaceuticals, Inc. Consolidated Balance Sheets (unaudited) (in thousands) December 31, 2023 2022 Assets Current assets Cash and cash equivalents $ 391,565 $ 549,912 Restricted cash 3,231 1,280 Other receivables 3,094 2,753 Other current assets 40,247 15,869 Total current assets 438,137 569,814 Restricted cash, non-current 6,629 7,920 Property and equipment, net 86,510 88,192 Operating lease right-of-use assets 33,663 33,255 Intangible assets, net 36,443 1,306 Goodwill 52,056 801 Other assets, non-current 261 — Total assets $ 653,699 $ 701,288 Liabilities and stockholders’ equity Current liabilities Accounts payable $ 3,953 $ 4,586 Accrued expenses and other liabilities 46,635 32,904 Unearned revenue 36,426 56,726 Notes payable 41 97 Operating lease liabilities 6,116 5,952 Total current liabilities 93,171 100,265 Unearned revenue, non-current 51,238 70,261 Notes payable, non-current 1,101 536 Operating lease liabilities, non-current 43,414 44,420 Deferred tax liabilities 1,339 — Total liabilities 190,263 215,482 Commitments and contingencies (Note 7) Stockholders’ equity Common stock (Class A, B and Exchangeable) 2 2 Additional paid-in capital 1,431,056 1,125,360 Accumulated deficit (967,622 ) (639,556 ) Total stockholder's equity 463,436 485,806 Total liabilities and stockholders’ equity $ 653,699 $ 701,288 Forward-Looking Statements This document contains information that includes or is based upon “forward-looking statements” within the meaning of the Securities Litigation Reform Act of 1995, including, without limitation, those regarding the outcomes and benefits expected from the Large Language Model-Orchestrated Workflow Engine; outcomes and benefits expected from training causal AI models utilizing multimodal data held at Tempus; expectations regarding early and late stage discovery, preclinical, and clinical programs, including timelines for enrollment in studies, data readouts, and progression toward IND-enabling studies; expectations and developments with respect to licenses and collaborations, including option exercises by partners and additional partnerships; prospective products and their potential future indications and market opportunities; developments with Recursion OS and other technologies, including augmentation of our dataset; expectations for business and financial plans and performance, including cash runway; Recursion’s plan to maintain a leadership position in data generation and aggregation; the timing of the filing of the Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and the inclusion of the CEO Letter; and all other statements that are not historical facts. Forward-looking statements may or may not include identifying words such as “plan,” “will,” “expect,” “anticipate,” “intend,” “believe,” “potential,” “could,” “continue,” and similar terms. These statements are subject to known or unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied in such statements, including but not limited to: challenges inherent in pharmaceutical research and development, including the timing and results of preclinical and clinical programs, where the risk of failure is high and failure can occur at any stage prior to or after regulatory approval due to lack of sufficient efficacy, safety considerations, or other factors; our ability to leverage and enhance our drug discovery platform; our ability to obtain financing for development activities and other corporate purposes; the success of our collaboration activities; our ability to obtain regulatory approval of, and ultimately commercialize, drug candidates; our ability to obtain, maintain, and enforce intellectual property protections; cyberattacks or other disruptions to our technology systems; our ability to attract, motivate, and retain key employees and manage our growth; inflation and other macroeconomic issues; and other risks and uncertainties such as those described under the heading “Risk Factors” in our filings with the U.S. Securities and Exchange Commission, including our Annual Report on Form 10-K for the Fiscal Year Ended December 31, 2023. All forward-looking statements are based on management’s current estimates, projections, and assumptions, and Recursion undertakes no obligation to correct or update any such statements, whether as a result of new information, future developments, or otherwise, except to the extent required by applicable law. A photo accompanying this announcement is available at Recursion's Pipeline Recursion's internal pipeline

Entered into a collaboration with Tempus giving Recursion access to over 20 petabytes of multimodal oncology data for the purpose of training causal AI models together with Recursion’s proprietary data and for designing biomarker and patient stratification strategies for clinical programsExpansion of Recursion’s in-house supercomputer, BioHive-1, with NVIDIA H100 GPUs will likely make it the most powerful computer wholly owned or operated by any biopharma company and among the 50 most powerful supercomputers on the Top500 ListUpdated collaboration with Bayer to deliver against their thematic focus in precision oncology with higher per program milestones and broader use of Recursion’s OS SALT LAKE CITY, Nov. 09, 2023 (GLOBE NEWSWIRE) -- Recursion (Nasdaq: RXRX), a leading clinical stage TechBio company decoding biology to industrialize drug discovery, today reported business updates and financial results for its third quarter ending September 30, 2023. “Since our founding we have led TechBio with a belief that the next generation of biopharma leaders would operate at the intersection of scaled datasets and accelerated computing,” said Chris Gibson, Ph.D., Co-founder and CEO of Recursion. “Today, we are thrilled to share our plans to continue leading the field forward at this nexus in order to advance a growing pipeline of both wholly owned and partnered programs towards impact for patients. First, on the data front, we are excited to announce a collaboration with Tempus, giving us access to over 20 PB of proprietary data in precision oncology. I believe these forward-genetic data, combined with Recursion’s multimodal reverse-genetic data, will continue strengthening our data-advantage. Second, on the compute front, we are pleased to announce a significant commitment to expand our BioHive-1 supercomputer to advance the exploration and construction of large AI models across our ever-growing proprietary biological data more rapidly and reliably. And finally, the evolution of our collaboration with Bayer and the recent exercise of our first oncology program option from Roche and Genentech highlights the growing appreciation of our Recursion OS by world-class teams in biopharma. We could not be more inspired about the future and are confident that the Recursion OS will continue to lead the transformation of BioTech into TechBio.” Recursion OS: Industrializing drug discovery to transform BioTech into TechBio Summary of Business Highlights Platform Tempus Collaboration Oncology-Focused, Precision Medicine Data: Tempus has built one of the world’s largest oncology-focused clinical and DNA/RNA molecular observational datasets. Our new collaboration with Tempus gives Recursion preferred access to these data. When combined with Recursion’s proprietary dataset of over 25 petabytes of interventional biological and chemical data, Recursion will now have approximately 50 petabytes of proprietary data fit for the purpose of machine learning at its disposal, enabling us to improve the training of causal AI/ML models of biology. When applied to our genome-wide reverse genetics platform, these data could facilitate the discovery of novel associations and mechanisms not otherwise identifiable in the clinical and forward genetics data from Tempus. Additionally, this patient-linked data will be used to support translating innovative therapeutics from Recursion’s platform directly to patients using novel biomarker and patient stratification strategies.Terms of the Tempus Collaboration: Recursion entered into an agreement with Tempus to access its patient-centric data as part of a 5-year licensing agreement. Recursion will make annual payments to Tempus in cash or equity ranging between $22M and $42M each year, up to $160M in aggregate, over the next 5 years in exchange for continued and updated data access and use rights for therapeutic development purposes. Supercomputer Expansion: We have committed to working with NVIDIA to expand BioHive-1, our on-premise supercomputer. After the expansion, which will be completed in the first half of 2024, BioHive-1 computational capacity will increase by over 4x (adding more than 500 NVIDIA H100 GPUs to the more than 300 NVIDIA A100s already in place). We project that upon completion and benchmarking, BioHive-1 will be in the top 50 most powerful supercomputers in the world across any industry (according to the Top500 list) and will be the most powerful supercomputer owned and operated by any biopharma company. These additional computational resources will continue to support the construction of the largest foundation models across biology and chemistry using Recursion’s vast datasets and data generation capabilities as well as tools based on interactive large language models and autonomous agents.Foundation Models: Our supercomputer expansion is meant to build on the deployment of our first Phenomics Foundation Model, PHENOM-1, which is a vision transformer utilizing hundreds of millions of parameters trained on billions of biological images from our proprietary phenomics library. PHENOM-1 demonstrated the scaling hypothesis within a biological context, namely that larger models trained on more diverse datasets lead to increased performance and emergent properties. With our recent acquisitions of digital chemistry company Cyclica and the deep-learning research team at Valence Discovery (now Valence Labs), the vast patient-centric data from Tempus and our own growing proprietary multi-omic datasets, we anticipate the construction and application of more foundation models and large language models across biology, chemistry and translation. Together, we believe these increasingly sophisticated models will enable us to drive new, better programs into clinical development both in our own pipeline and with our current and future partners at scale. Pipeline Cerebral Cavernous Malformation (CCM) (REC-994): Our Phase 2 SYCAMORE clinical trial is a double-blind, placebo-controlled safety, tolerability and exploratory efficacy study of this drug candidate in participants with CCM. This study was fully enrolled as of June 2023 with 62 participants and the vast majority of participants who have thus far finished their first year of treatment have enrolled in the long-term extension study. We expect to share Phase 2 proof-of-concept data in H2 2024.Neurofibromatosis Type 2 (NF2) (REC-2282): Our Phase 2/3 POPLAR clinical trial is a two part study of REC-2282 in participants with progressive NF2-mutated meningiomas due either to syndromic disease or initiating mutations in the meningiomas. Part 1 of the study is ongoing and is exploring two doses of REC-2282 in approximately 23 adults and 9 adolescents. We expect to share Phase 2 safety, tolerability, pharmacokinetics, and preliminary efficacy in H2 2024.Familial Adenomatous Polyposis (FAP) (REC-4881): Our Phase 2 TUPELO clinical trial is a two part study of REC-4881 in participants with FAP. Evaluation of three dose levels is ongoing, thereafter a dose expansion phase will commence evaluating the recommended Phase 2 dose in approximately 30 participants. We expect to share Phase 2 safety, tolerability, pharmacokinetics, and preliminary efficacy in H1 2025.AXIN1 or APC Mutant Cancers (REC-4881): Our Phase 2 LILAC clinical trial is a biomarker enriched two part study of REC-4881 in participants with unresectable, locally advanced or metastatic cancer with AXIN1 or APC mutations. The study will initiate in late Q4 2023 or early Q1 2024 and will explore the safety and efficacy of REC-4881 across three dose levels in 30-40 participants.Clostridioides difficile Infection (REC-3964): In early September 2023, we announced completion of our Phase 1 clinical trial and reported that REC-3964 had been well tolerated in healthy volunteers with no serious adverse events. We expect to initiate a Phase 2 proof-of-concept study in patients with recurrent Clostridioides difficile infection in 2024.RBM39 HR-Proficient Ovarian Cancer: RBM39 is a novel CDK12-adjacent target identified by the Recursion OS. We believe we can modulate this target to produce a therapeutic effect in HR-proficient ovarian cancer and potentially in other tumor types. This program is in the preclinical stage and IND-enabling studies are progressing. Partnerships Bayer: Bayer and Recursion have signed an update to their collaboration around a select set of oncology programs. This decision allows Bayer to leverage Recursion’s capabilities to identify novel targets and compounds applicable to traditionally undruggable oncology indications as well as Recursion’s access to expansive oncology-focused, patient-centric data from Tempus for their closely partnered programs. Under the amended and restated agreement, Bayer will pay Recursion increased per program milestones which may be up to $1.5B for up to 7 oncology programs as well as royalties on net sales. In this oncology-focused collaboration, Recursion will use many of the new tools it has developed since the collaboration was first signed to potentially identify and nominate programs rapidly.Roche-Genentech: In October 2023, Recursion announced that Roche-Genentech optioned its first partnership program in GI-oncology. This milestone represents a critical step in our joint efforts to initiate and advance new therapeutic programs using Recursion’s approach to map and navigate biology and chemistry. In the near-term, there is the potential for option exercises associated with map building or data sharing initiatives as well as option exercises associated with additional partnership programs. Third Quarter 2023 Financial Results Cash Position: Cash and cash equivalents were $387.3 million as of September 30, 2023. This cash position excludes the $3 million to be paid by Roche-Genentech for optioning its first partnership program in GI-oncology. Revenue: Total revenue was $10.5 million for the third quarter of 2023, compared to $13.2 million for the third quarter of 2022. The decrease was due to the timing of workflows from our strategic partnership with Roche-Genentech..Research and Development Expenses: Research and development expenses were $70.0 million for the third quarter of 2023, compared to $40.8 million for the third quarter of 2022. The increase in research and development expenses was due to increased platform costs as we have expanded and upgraded our capabilities.General and Administrative Expenses: General and administrative expenses were $29.2 million for the third quarter of 2023, compared to $19.5 million for the third quarter of 2022. The increase in general and administrative expenses was due to an increase in salaries and wages of $5.8 million and increases in software and depreciation expenses.Net Loss: Net loss was $93.0 million for the third quarter of 2023, compared to a net loss of $60.4 million for the third quarter of 2022.Net Cash: Net cash used in operating activities was $72.9 million for the third quarter of 2023, compared to net cash used in operating activities of $54.5 million for the third quarter of 2022. About RecursionRecursion is a clinical stage TechBio company leading the space by decoding biology to industrialize drug discovery. Enabling its mission is the Recursion OS, a platform built across diverse technologies that continuously expands 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 and the San Francisco Bay Area. Learn more at www.Recursion.com, or connect on Twitter and LinkedIn. Media ContactMedia@Recursion.com Investor ContactInvestor@Recursion.com Consolidated Statements of Operations Recursion Pharmaceuticals, Inc. Condensed Consolidated Statements of Operations (unaudited) (in thousands, except share and per share amounts) Three months ended Nine months ended September 30 September 30Revenue 2023 2022 2023 2022 Operating revenue$10,102 $13,053 $33,252 $26,005 Grant revenue 431 107 432 162 Total revenue 10,533 13,160 33,684 26,167 Operating costs and expenses Cost of revenue 10,877 15,409 32,706 37,435 Research and development 70,007 40,836 171,744 111,716 General and administrative 29,199 19,488 80,364 61,761 Total operating costs and expenses 110,083 75,733 284,814 210,912 Loss from operations (99,550) (62,573) (251,130) (184,745) Other income, net 6,533 2,128 16,060 2,761 Net loss$(93,017) $(60,445) $(235,070) $(181,984) Per share data Net loss per share of Class A, B and Exchangeable common stock, basic and diluted$(0.43) $(0.35) $(1.16) $(1.06)Weighted-average shares (Class A, B and Exchangeable) outstanding, basic and diluted 214,327,186 173,435,970 203,090,637 172,122,974 Consolidated Balance Sheets Recursion Pharmaceuticals, Inc. Condensed Consolidated Balance Sheets (unaudited) (in thousands) September 30,December 31, 2023 2022 Assets Current assets Cash and cash equivalents$387,322 $549,912 Restricted cash 2,256 1,280 Other receivables 3,164 2,753 Other current assets 17,780 15,869 Total current assets 410,522 569,814 Restricted cash, non-current 7,629 7,920 Property and equipment, net 86,248 88,192 Operating lease right-of-use assets 34,062 33,255 Intangible assets, net 39,459 1,306 Goodwill 52,750 801 Other assets, non-current 155 - Total assets$630,825 $701,288 Liabilities and stockholders’ equity Current liabilities Accounts payable$4,265 $4,586 Accrued expenses and other liabilities 39,806 32,904 Unearned revenue 43,997 56,726 Notes payable 695 97 Operating lease liabilities 5,355 5,952 Total current liabilities 94,118 100,265 Unearned revenue, non-current 51,383 70,261 Notes payable, non-current 1,126 536 Operating lease liabilities, non-current 44,300 44,420 Deferred tax liabilities 1,931 - Total liabilities 192,858 215,482 Commitments and contingencies Stockholders’ equity Common stock (Class A, B and Exchangeable) 2 2 Additional paid-in capital 1,312,591 1,125,360 Accumulated deficit (874,626) (639,556) Total stockholder's equity 437,967 485,806 Total liabilities and stockholders’ equity$630,825 $701,288 Forward-Looking StatementsThis document contains information that includes or is based upon "forward-looking statements" within the meaning of the Securities Litigation Reform Act of 1995, including, without limitation, those regarding the outcomes and benefits expected from access to the real-world multimodal data held at Tempus; outcomes and benefits of deriving therapeutic hypotheses by linking molecular data and outcomes data; outcomes and benefits of expanding our supercomputer; early and late stage discovery, preclinical, and clinical programs, including timelines for data readouts; licenses and collaborations, including option exercises by partners and additional partnerships; prospective products and their potential future indications and market opportunities; Recursion OS and other technologies; business and financial plans and performance, including cash runway; and all other statements that are not historical facts. Forward-looking statements may or may not include identifying words such as “plan,” “will,” “expect,” “anticipate,” “intend,” “believe,” “potential,” “could,” “continue,” and similar terms. These statements are subject to known or unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied in such statements, including but not limited to: challenges inherent in pharmaceutical research and development, including the timing and results of preclinical and clinical programs, where the risk of failure is high and failure can occur at any stage prior to or after regulatory approval due to lack of sufficient efficacy, safety considerations, or other factors; our ability to leverage and enhance our drug discovery platform; our ability to obtain financing for development activities and other corporate purposes; the success of our collaboration activities; our ability to obtain regulatory approval of, and ultimately commercialize, drug candidates; our ability to obtain, maintain, and enforce intellectual property protections; cyberattacks or other disruptions to our technology systems; our ability to attract, motivate, and retain key employees and manage our growth; inflation and other macroeconomic issues; and other risks and uncertainties such as those described under the heading “Risk Factors” in our filings with the U.S. Securities and Exchange Commission, including our most recent Quarterly Report on Form 10-Q and our Annual Report on Form 10-K. All forward-looking statements are based on management’s current estimates, projections, and assumptions, and Recursion undertakes no obligation to correct or update any such statements, whether as a result of new information, future developments, or otherwise, except to the extent required by applicable law. Photos accompanying this announcement are available at:https://www.globenewswire.com/NewsRoom/AttachmentNg/816be0b8-7538-44d3-ae77-526a0f0a4ae0https://www.globenewswire.com/NewsRoom/AttachmentNg/f6a98a74-af5f-4d00-84fd-99f6738146f3

Deployed new digital chemistry technology, together with NVIDIA, to predict the ligand-protein interactions for approximately 36 billion compounds in the Enamine REAL Space, reported to be the world’s largest searchable chemical library Added, accelerated or tightened guidance for clinical study readouts or clinical starts; the first clinical readout is expected in Q3 2023 Delivered value in our pipeline, partnerships, and platform through the acquisitions of Cyclica and Valence Discovery Announced a $50 million investment and partnership with NVIDIA to accelerate the construction, optimization and deployment of foundation models for biology and chemistry Continued advancing large-scale foundation models for drug discovery with our partners at NVIDIA SALT LAKE CITY, Aug. 08, 2023 (GLOBE NEWSWIRE) -- Recursion (Nasdaq: RXRX), a leading clinical stage TechBio company decoding biology to industrialize drug discovery, today reported business updates and financial results for its second quarter ending June 30, 2023. "As the world continues to undergo a revolution in artificial intelligence and computation, Recursion is leading the TechBio sector with one of the most advanced technology-enabled drug discovery platforms in the industry," said Chris Gibson, Ph.D., Co-Founder and CEO of Recursion. "Our recent acquisitions of Cyclica and Valence and our new partnership with NVIDIA bring industry-leading capabilities to our platform that have already delivered significant value across our pipeline and partnerships. With multiple clinical catalysts in the coming quarters, the extraordinary progress in our technology, and the commitment of our teams, Recursion is making its vision of industrialized drug discovery real day by day." Summary of Business Highlights Pipeline Cerebral Cavernous Malformation (CCM) (REC-994): Our Phase 2 SYCAMORE clinical trial is a double-blind, placebo-controlled safety, tolerability and exploratory efficacy study of this drug candidate in participants with CCM. This study was fully enrolled as of June 2023 with 62 participants and all participants who have thus far finished their first year of treatment have enrolled in the long-term extension study. We expect to share Phase 2 proof-of-concept data in H2 2024. Neurofibromatosis Type 2 (NF2) (REC-2282): Our Phase 2/3 POPLAR clinical trial is a two part study of REC-2282 in participants with progressive NF2-mutated meningiomas. Part A of the study is ongoing and is exploring two doses of REC-2282 in approximately 23 adults and 9 adolescents. We expect to share Phase 2 safety, tolerability, pharmacokinetics, and preliminary efficacy in H2 2024. Familial Adenomatous Polyposis (FAP) (REC-4881): We have enrolled multiple participants in our TUPELO clinical trial which evaluates REC-4881 in patients with FAP. We are now providing guidance on a data readout and expect to share Phase 2 safety, tolerability, pharmacokinetics, and preliminary efficacy in H1 2025. AXIN1 or APC Mutant Cancers (REC-4881): We will evaluate REC-4881 in a Phase 2 biomarker enriched study in patients with unresectable, locally advanced or metastatic cancer with AXIN1 or APC mutations. The IND was accepted by the FDA and we expect to initiate this Phase 2 study in Q4 2023. Clostridioides difficile Infection (REC-3964): Our Phase 1 clinical trial is a first-in-human protocol evaluating single and multiple doses of REC-3964 in healthy volunteers and will assess the safety, tolerability and pharmacokinetic pro REC-3964. Single ascending dose and multiple ascending dose studies are now complete. REC-3964 has been well tolerated and no safety issues have been identified to date. We expect to share Phase 1 safety and pharmacokinetics data in Q3 2023. RBM39 HR-Proficient Ovarian Cancer: RBM39 (previously identified as Target Gamma) is a novel CDK12-adjacent target identified by the Recursion OS. We believe we can modulate this target to produce a therapeutic effect in HR-proficient ovarian cancer and potentially in other tumor types. This program is in the preclinical stage and IND-enabling studies are progressing. Partnerships NVIDIA: In July 2023, we announced a $50 million investment and collaboration with NVIDIA. We will continue to build our own foundation models for biology and chemistry and NVIDIA will assist in optimizing these models, provide priority access to computational resources on NVIDIA’s cloud service DGX Cloud, and potentially host commercially-licensable machine learning and foundation models developed by Recursion on BioNeMo, NVIDIA’s marketplace for generative AI in drug discovery. In this partnership, we will maintain control of our proprietary data and models as well as how and where we could host our technology tools as we expand our business strategy of data as a value driver. Since the announcement in July, we have already deployed our digital chemistry technology together with NVIDIA’s computational resources to predict the ligand-protein interactions for approximately 36 billion compounds in the Enamine REAL Space, reported to be the world’s largest searchable chemical library, where we evaluated 2.8 quadrillion target-compound pairs. Roche-Genentech and Bayer: We continue to advance our collaborations to discover potential new therapeutics with our strategic partners Roche-Genentech and Bayer. In the near-term, there is the potential for option exercises associated with partnership programs or option exercises associated with map building initiatives or data sharing. Platform Digital Chemistry and Generative AI Capabilities: In May 2023, we acquired Cyclica and Valence Discovery to bolster our digital chemistry and generative AI capabilities and drive value across our pipeline, partnerships, and platform. Shortly after closing these acquisitions, we used Cyclica’s digital chemistry tools to predict the protein-ligand interactions for the over 1 million compounds in our internal, non-partnered chemical library. Now, less than one quarter after the closing of these acquisitions, we worked with our partners at NVIDIA to predict the protein-ligand interactions of approximately 36 billion compounds in the Enamine REAL Space, reported to be the world’s largest searchable chemical library. Accelerating Pipeline and Partnership Value: For our internal pipeline, we have used our digital chemistry tools to deconvolve proteome-wide biological targets to confirm that certain compounds operate through a novel mechanism of action which was previously predicted by our functional phenomics maps. Such proteomic mapping capabilities provide an additional data layer to efficiently identify the most promising novel chemical series. Foundation Model Construction: We continue to use our supercomputer, BioHive-1, to train a proprietary phenomics foundation model. As we have trained on larger quantities of our proprietary data, emergent properties have arisen out of the models and we have seen significant improvements over previous deep learning production models. We are also in the early stages of exploring more powerful and broadly useful foundation models based on our large-scale proprietary multi-omics data, which includes phenomics across 50 human cell types and approximately 1.7 million compounds, multi-timepoint live-cell microscopy, transcriptomics, proteomics, inVivomics, multi-target compound interactions, physicochemical properties, as well predicted protein-ligand relationships. We may explore commercial licensing of some of our models in collaboration with NVIDIA and their BioNeMo platform in the coming year, though our state-of-the-art models will only be available to our team and close partners. Large Language Models: One year ago, more than 40 employees were dedicated to exploring our maps of biology and chemistry to initiate programs at Recursion. Today, those same employees have been redeployed and our newest internal programs are being initiated autonomously. This efficiency and scale is through the deployment of large language models to map scientific literature in conjunction with our internally derived proprietary maps to identify opportunities for scientific arbitrage in areas of unmet need. These opportunities are then automatically prioritized for confirmation and validation in our highly-automated wetlabs. This is a significant step towards our vision of autonomous drug discovery and biological exploration. Valence Labs - Powered by Recursion: In July 2023 at the International Conference for Machine Learning, we launched Valence Labs, Recursion’s cutting-edge machine learning research center for biology and chemistry in Montréal that aims to promote open-science and academic research. Recursion’s commitment to open-science helps us recruit and retain the best talent in the field of generative AI, allows us to design and set the standards by which ML and AI are deployed in drug discovery, and may drive additional biopharma companies to consider partnering with Recursion to get access to our proprietary state-of-the-art tools, technology, datasets and programs. Additional Corporate Updates Chief Medical Officer: In May 2023, David Mauro, M.D., Ph.D. joined Recursion as its Chief Medical Officer. Dr. Mauro has over 20 years experience in oncology drug development and has guided more than 25 Investigational New Drug candidates through the translational, preliminary, and later stages of development at various companies. Chief Legal Officer: In July 2023, Recursion named Nathan Hatfield, J.D., M.B.A. as Chief Legal Officer. Mr. Hatfield has worked at Recursion for over 6 years, previously serving as SVP and Head of Legal. Prior to Recursion, Mr. Hatfield was a securities attorney at the law firm Wilson Sonsini Goodrich & Rosati. Toronto Office: In June 2023, we celebrated the opening of our Canadian Headquarters in Toronto with government officials as well as members of the technology and biotechnology communities. ESG Reporting: In June 2023, Recursion received a favorable ESG Risk Rating from Morningstar Sustainalytics which ranked Recursion as the #1 biotechnology company out of approximately 400 companies and the #14 pharmaceuticals company out of approximately 900 companies. Second Quarter 2023 Financial Results Cash Position: Cash and cash equivalents were $405.9 million as of June 30, 2023. This cash position does not include the recent $50 million investment from NVIDIA. Revenue: Total revenue was $11.0 million for the second quarter of 2023, compared to $7.7 million for the second quarter of 2022. The increase was due to progress made in our Roche-Genentech collaboration. Research and Development Expenses: Research and development expenses were $55.1 million for the second quarter of 2023, compared to $38.4 million for the second quarter of 2022. The increase in research and development expenses was due to increased platform costs as we have expanded and upgraded our capabilities. General and Administrative Expenses: General and administrative expenses were $28.3 million for the second quarter of 2023, compared to $21.2 million for the second quarter of 2022. The increase in general and administrative expenses was due to an increase in salaries and wages of $3.0 million and increases in software and depreciation expense. Net Loss: Net loss was $76.7 million for the second quarter of 2023, compared to a net loss of $65.6 million for the second quarter of 2022. About Recursion Recursion is a clinical stage TechBio company leading the space by decoding biology to industrialize drug discovery. Enabling its mission is the Recursion OS, a platform built across diverse technologies that continuously expands 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 and the San Francisco Bay Area. Learn more at , or connect on Twitter and LinkedIn. Media Contact Media@Recursion.com Investor Contact Investor@Recursion.com Consolidated Statements of Operations Recursion Pharmaceuticals, Inc. Condensed Consolidated Statements of Operations (unaudited) (in thousands, except share and per share amounts) Three months ended Six months ended June 30, June 30, Revenue 2023 2022 2023 2022 Operating revenue $ 11,016 $ 7,653 $ 23,150 $ 12,952 Grant revenue 1 21 1 55 Total revenue 11,017 7,674 23,151 13,007 Operating costs and expenses Cost of revenue 9,382 14,227 21,829 22,026 Research and development 55,060 38,439 101,737 70,880 General and administrative 28,290 21,199 51,165 42,273 Total operating costs and expenses 92,732 73,865 174,731 135,179 Loss from operations (81,715 ) (66,191 ) (151,580 ) (122,172 ) Other income, net 4,989 631 9,527 633 Net loss $ (76,726 ) $ (65,560 ) $ (142,053 ) $ (121,539 ) Per share data Net loss per share of Class A, B and Exchangeable common stock, basic and diluted $ (0.38 ) $ (0.38 ) $ (0.71 ) $ (0.71 ) Weighted-average shares (Class A, B and Exchangeable) outstanding, basic and diluted 201,415,475 172,212,390 198,957,804 171,455,595 Consolidated Balance Sheets Recursion Pharmaceuticals, Inc. Condensed Consolidated Balance Sheets (unaudited) (in thousands) June 30, December 31, 2023 2022 Assets Current assets Cash and cash equivalents $ 405,870 $ 549,912 Restricted cash 3,325 1,280 Other receivables 3,051 2,753 Other current assets 18,774 15,869 Total current assets 431,020 569,814 Restricted cash, non-current 7,629 7,920 Property and equipment, net 89,768 88,192 Operating lease right-of-use assets 34,899 33,255 Intangible assets, net 42,757 1,306 Goodwill 60,516 801 Other assets, non-current 110 - Total assets $ 666,699 $ 701,288 Liabilities and stockholders’ equity Current liabilities Accounts payable $ 2,086 $ 4,586 Accrued expenses and other liabilities 32,873 32,904 Unearned revenue 73,105 56,726 Notes payable 676 97 Operating lease liabilities 5,219 5,952 Total current liabilities 113,959 100,265 Unearned revenue, non-current 32,436 70,261 Notes payable, non-current 1,155 536 Operating lease liabilities, non-current 45,850 44,420 Deferred tax liabilities 4,336 - Total liabilities 197,736 215,482 Commitments and contingencies Stockholders’ equity Common stock (Class A, B and Exchangeable) 2 2 Additional paid-in capital 1,250,570 1,125,360 Accumulated deficit (781,609 ) (639,556 ) Total stockholder's equity 468,963 485,806 Total liabilities and stockholders’ equity $ 666,699 $ 701,288 Forward-Looking Statements This document contains information that includes or is based upon "forward-looking statements'' within the meaning of the Securities Litigation Reform Act of 1995, including, without limitation, those regarding the outcomes and benefits expected from the NVIDIA partnership and Cyclica and Valence Discovery acquisitions and the launch of Valence Labs; early and late stage discovery, preclinical, and clinical programs, including timelines for data readouts; licenses and collaborations, including option exercises by partners and additional partnerships; prospective products and their potential future indications and market opportunities; Recursion OS and other technologies; business and financial plans and performance, including cash runway; and all other statements that are not historical facts. Forward-looking statements may or may not include identifying words such as “plan,” “will,” “expect,” “anticipate,” “intend,” “believe,” “potential,” “could,” “continue,” and similar terms. These statements are subject to known or unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied in such statements, including but not limited to: challenges inherent in pharmaceutical research and development, including the timing and results of preclinical and clinical programs, where the risk of failure is high and failure can occur at any stage prior to or after regulatory approval due to lack of sufficient efficacy, safety considerations, or other factors; our ability to leverage and enhance our drug discovery platform; our ability to obtain financing for development activities and other corporate purposes; the success of our collaboration activities; our ability to obtain regulatory approval of, and ultimately commercialize, drug candidates; our ability to obtain, maintain, and enforce intellectual property protections; cyberattacks or other disruptions to our technology systems; our ability to attract, motivate, and retain key employees and manage our growth; inflation and other macroeconomic issues; and other risks and uncertainties such as those described under the heading “Risk Factors” in our filings with the U.S. Securities and Exchange Commission, including our most recent Quarterly Report on Form 10-Q and our Annual Report on Form 10-K. All forward-looking statements are based on management’s current estimates, projections, and assumptions, and Recursion undertakes no obligation to correct or update any such statements, whether as a result of new information, future developments, or otherwise, except to the extent required by applicable law. An infographic accompanying this announcement is available at Recursion's Pipeline Recursion's internal pipeline as of Q2 2023