Ladies and gentlemen, thank you for standing by. Welcome to Evogene's fourth quarter and full year 2023 results conference call. All participants are present in listen-only mode. Following management's formal presentation, instructions will be given for the question-and-answer session. For operator assistance during the conference, please press star zero. As a reminder, this conference is being recorded, March 7, 2024. Before we begin, I would like to caution that certain statements made during this earnings conference call by Evogene's management will constitute forward-looking statements that relate to future events. This investor call contains forward-looking statements relating to future events. These statements may be identified by words such as may, could, expect, hopes, intents, anticipates, plans, believes, scheduled, estimates, or words of similar meaning.
For example, Evogene is using forward-looking statement in this investor call when it discusses the further partnerships with industry leaders, increased sales of subsidiary products like Casterra's elite castor varieties, and Lavie Bio's bio-inoculant Yalos, expansion beyond its current sectors, continued revenue growth for the Evogene Group in 2024, potential transfer of Canonic operations to a third party, increased production of Casterra, commercialization of AgPlenus and Lavie Bio's products, and the timing and results of the clinical trials and preclinical trials of Biomica's products. Such statements are based on current expectations, estimates, projections, and assumptions describe opinions about future events, involve certain risks and uncertainties which are difficult to predict and are not guarantees of future performance.
Therefore, actual future results, performance, or achievements of Evogene and its subsidiaries may differ materially from what is expressed or implied by such forward-looking statements due to a variety of factors, many of which are beyond the control of Evogene and its subsidiaries, including without limitation the current war between Israel and Hamas and any worsening of the situation in Israel, such as further mobilizations or escalation in the northern border of Israel, and those risk factors contained in Evogene's reports filed with the applicable securities authority. In addition, Evogene and its subsidiaries rely and expect to continue to rely on third parties to conduct certain activities such as their field trials and preclinical studies, and if these third parties do not successfully carry out their contractual duties, comply with regulatory requirements, or meet expected deadlines, Evogene and its subsidiaries may experience significant delays in the conduct of their activities.
Evogene and its subsidiaries disclaim any obligation or commitment to update these forward-looking statements to reflect future events or developments, or changes in expectations, estimates, projections, and assumptions. More detailed information about the risk factors potentially adversely impacting our performance can be found in our reports filed with the U.S. Securities and Exchange Commission. Today's call will feature Ofer Haviv, President and CEO of Evogene, alongside Yaron Eldad, CFO of Evogene, and Yoash Zohar, CEO of Casterra. Additionally, a representative from each subsidiary will be present at the Q&A session. That said, I would now like to turn over the call to Ofer Haviv, President and CEO of Evogene. Mr. Haviv, please go ahead.
Hi and good day everyone. In today's conference call, I would like to start with a review of the Evogene Group achievements during 2023 until today and provide you with an update on our activities as well as potential catalysts during the next 12 months. Following my review, Casterra's new CEO, Yoash Zohar, will introduce himself, provide an update on Casterra's activity, and outline the company's goals for the coming years. Evogene's CFO, Yaron Eldad, will then provide a financial summary and update. After that, we will open the Q&A session. What year it's been for the Evogene Group since our last earnings call summarizing 2022. Despite the challenges we are facing collectively here in Israel, this year marks a significant shift in how the industry views our technology and products, translating into growing collaborations with world-leading companies.
The number and caliber of partnerships Evogene and our subsidiaries have formed speaks volumes. Lavie Bio partnering with Corteva, ICL, and Syngenta. AgPlenus partnering with Bayer and Corteva. Casterra partnered with global oil and gas company. Biomica securing investment from Shanghai Healthcare Capital. And Evogene collaborating with Verb Biotics and Colors all highlight our growing presence and impact in the life science industry. This expanding collaboration momentum validates the value of Evogene's AI tech engines, MicroBoost AI, ChemPass AI, and GeneRator AI, relying on our CPB platform, which we have been developing for over a decade. Looking ahead, we anticipate further collaboration with industry leaders directly or through our subsidiaries, an increase in the volume of sales of products by our subsidiaries such as Casterra's elite castor varieties and Lavie Bio's bio-inoculant Yalos, and expanding Evogene's reach beyond its current sectors of activity.
These efforts not only validate our contribution but also strengthen our financial position through non-dilutive funding and revenue streams from upfront payments, R&D fees, milestones, and direct product sales. It's reflected in the revenue the company reports today, totaling approximately $5.6 million compared to approximately $1.7 million in 2022. We expect to see continued growth in the Evogene Group revenue in 2024. As we have new listeners on today's call, I would like to briefly review Evogene's core technology and our value proposition. Evogene has been using its computational predictive biology platform, the CPB, to direct and accelerate the development of life science-based products. The CPB is at the foundation of our three AI tech engines. MicroBoost AI supports the development of microbe-based products. ChemPass AI supports small molecules-based products. GeneRator AI supports products based on genetic elements.
Our AI-driven tech engines aim to tackle the main challenges in life science product development: candidate discovery and optimization, identifying winning candidates from a vast number of prospects, and meeting complex criteria for successful commercial products. The value proposition of our AI-driven tech engines stems from the efficient finding of the middle in the haystack, therefore increasing the probability of the success within a competitive time frame and in a cost-efficient manner. After reviewing our technology, onto our business model. Our business model revolves around two main strategies for leveraging our AI technology: licensing. Evogene offers time-limited license to third parties such as our subsidiaries or related entities, allowing them to use our tech engines for product development within a specific commercial domain.
This model typically generates revenue through license fee, R&D reimbursement, but more importantly, dividends to Evogene as a shareholder or a significant one-time payment upon an exit event, particularly if Evogene is a major shareholder. Collaboration. Evogene collaborates with industry leaders to jointly drive product development. In these ventures, our partners often take the lead in later-stage development and commercialization, while we contribute our unique tech engine to identify and optimize product candidates. Revenue from this model usually came from upfront payments, R&D fees, and royalties from sales of future end products. Now, we are commercializing MicroBoost AI through licensing agreements with Lavie Bio for agbiological and with Biomica for human microbiome-based drugs development. Evogene is also collaborating with Verb Biotics to develop probiotic products. ChemPass AI is commercialized through a license agreement with our subsidiary AgPlenus for agchemical product development.
GeneRator AI is commercialized through license agreements with Casterra for castor seed variety and Canonic for medical cannabis products. Evogene is also collaborating with Colors Farm Ltd. on progressing gene editing technology through GeneRator AI. I would like now to review in more detail the collaboration that Evogene is engaged in with third parties and then briefly review the main achievements of our subsidiaries. At the beginning of February 2024, we proudly announced a partnership between Evogene and Verb Biotics, an innovative probiotics company. Our collaboration with Verb Biotics allows us to tap into the growing probiotics market using Evogene's MicroBoost AI tech engine. Together, we are working on identifying and designing probiotic bacteria that produce highly sustainable quantities of microbial metabolites known to improve human health and vitality.
With the probiotics market projected to double to around $114 billion by 2031, we are seizing the opportunity to revolutionize this industry and provide cutting-edge solutions for consumers worldwide. Earlier this year, we reported collaboration with Colors Farm and Ben-Gurion University to pioneer crustacean gene editing technology, aiming to enhance crustacean traits. The collaboration is powered by a grant from the Israel Innovation Authority and utilizes Evogene's GeneRator AI tech engine. Another milestone worth mentioning is that our Ag-Seed division secured a EUR 1.2 million grant to develop oilseed crops with enhanced CO2 accumulation and drought tolerance. The program known as the EIC 2022 Horizon Program supports businesses addressing climate focus and sustainable crop development. In this program, we utilize Evogene's GeneRator AI tech engine capabilities as well.
These partnerships exemplify our business approach and demonstrate how we use our tech engines to bring innovative products to market in sectors not covered by our subsidiaries. It's important for me to emphasize that all of these collaborations are all generating revenue to Evogene. Now, let's review our subsidiaries' achievements. I would like to start with Casterra, Evogene's fully owned subsidiary, which focuses on developing an integrated solution to enable large-scale commercial cultivation of castor beans, benefiting from its unique elite seed varieties utilizing GeneRator AI tech engines. Casterra's solutions aim to address the global demand for a stable castor oil supply, mainly for the biodiesel industry. The past year was pivotal for Casterra. Its vision of becoming a significant player in the biodiesel industry progresses with secured orders from a world-leading oil and gas company, totaling $11.3 million for castor cultivation in Africa.
In September, Casterra successfully delivered its first shipment of high-yield, high-oil castor seeds from Brazil and Zambia to an African region, generating revenue of approximately $1 million. Established earlier this week, the company recently signed agreements with existing and new seed producers in Brazil and Africa to increase its production capabilities of castor seeds in 2024, which are expected to add approximately 400 tons. This new agreement will enable the company to support the existing seed orders. Looking forward to 2024, Casterra is committed to expanding its castor seed production capacity through securing agreements with additional subcontractors in Brazil and Africa, on which we expect to update. Finally, in January 2024, we welcomed Yoash Zohar as Casterra's new CEO, who will later present himself. Yoash brings a wealth of experience in global ag projects and I'm confident in his ability to propel the company forward.
I wish him and the rest of Casterra's team good luck. Now, I would like to review our wholly owned subsidiary, AgPlenus, aiming to discover next-generation innovative crop protection products, including herbicides, insecticides, and fungicides, and commercialize them through collaboration with world-leading partners. AgPlenus utilizes Evogene's ChemPass AI tech engine to accelerate and direct its product development. Major agrochemical companies dominate today's crop protection industry. Still, they look to smaller ag tech companies to discover new target proteins and small molecules that inhibit such target proteins, serving as the active ingredient in commercial crop protection products. AgPlenus is the company that addresses this need. As I stated in the previous call, there is a growing interest in AgPlenus' product pipeline. Recently, we were fortunate to see that interest materialize. In February 2024, AgPlenus announced the signing of a licensing and a collaboration agreement with Bayer's crop science division.
Under the agreement, AgPlenus will use its AI-driven computational modeling technology to design and optimize the molecules identified for their broad-spectrum herbicidal activity, targeting the APTH1 protein, a new mode of action identified by AgPlenus. Bayer will have the exclusive license for developing and commercializing products developed within the collaboration. AgPlenus will be entitled to receive an upfront payment, ongoing research funding, milestone payments, and royalties based on future product sales. Another impressive and important announcement was the milestone achievement in the ongoing collaboration with Corteva for the development of novel herbicides. The milestone marks the successful identification of a new family of molecules exhibiting herbicidal effects through a novel mode of action, APCO-12, discovered by AgPlenus. In the next phase, the collaboration will optimize the identified molecules toward commercial-level products, utilizing AgPlenus' cutting-edge computational technology powered by Evogene's ChemPass AI tech engine.
These two collaborations strengthen AgPlenus' financial position and overall perceptions in the agriculture market. Last but not least, we introduced Dr. Dan Gelvan as AgPlenus' new CEO. Dan's extensive experience and proven track record well position him to guide AgPlenus through its next phase of growth and innovation. AgPlenus' former CEO, Dr. Brian Ember, has transitioned to Chief Business Officer. I would like to thank Brian for his contribution and leadership to AgPlenus, and I look forward to continuing our work together in his new role. AgPlenus is looking towards an exciting year with new management in place, the collaborative agreement signed with Bayer in February, and the milestone reached in the Corteva collaboration in March. 2024 is looking bright for the company. Alongside those, AgPlenus will continue to advance its pipeline based on the ChemPass AI tech engine and seek additional collaboration with existing and new partners.
I would like now to continue with the two subsidiaries using MicroBoost AI to accelerate and direct their product development, Biomica and Lavie Bio. Biomica, specializing in developing microbiome-based therapeutics for human health, utilizing Evogene's MicroBoost AI tech engine to discover and optimize microbes with therapeutic potential. In April 2023, Biomica completed a $20 million financing round with a Shanghai Healthcare Capital investment of $10 million. This investment, made at a post-money valuation of $50 million, serves as an external validation of Biomica's long-term potential. Biomica's flagship product candidate, BMC-128, targeting immune oncology patients, is currently undergoing phase I clinical trial. The trial, initiated at the Rambam Healthcare Campus in Israel, aims to assess BMC-128's safety and durability in combination with Bristol Myers Squibb's Opdivo immune therapy.
In August 2023, Biomica expanded its operations by opening a second site at the Davidoff Cancer Center in Israel to facilitate additional patient recruitment for the clinical trial. In January 2024, Biomica reached a significant milestone by completing phase I trial enrollment for its microbiome-based immuno-oncology drug, with preliminary results showing promising outcomes. Initial data point, readout, is anticipated during 2024. In July 2023, Biomica reported positive interim results from pre-clinical studies on its IBS program conducted in collaboration with Professor Kara Gross Margolis's lab at New York University. These results demonstrate the efficacy of Biomica's live bacterial consortia, BMC-426 and BMC-427, alleviating visceral pain, a major symptom of IBS, presenting promising new treatment avenues. Biomica intends to conduct further pre-clinical studies on BMC-426 and BMC-427 to prepare for clinical trials.
Looking ahead, Biomica remains committed to advancing its efforts and aims to submit an IND application for BMC-128, targeting immuno-oncology patients, during the third quarter of 2024, a pivotal step in preparing for phase II clinical trials in the U.S. In addition, the company will continue to advance its candidates in the IBS and IBD programs towards phase I clinical trials. Now, to Lavie Bio, who leverages Evogene's MicroBoost AI tech engine to develop next-generation ag-biological products. In addition to Evogene's majority ownership, Lavie Bio has two additional major shareholders: Corteva, a New York-listed multinational ag-tech giant, and ICL, a New York-listed global minerals and an ag-tech company. In July 2023, Lavie Bio entered a licensing agreement with Corteva, conferring exclusive rights to Corteva for advancing and commercializing Lavie Bio's lead bio-fungicides, LAV311 and LAV312, targeting fruit rots.
This agreement followed two years of independent field validation trials conducted by both companies. Under the agreement, Lavie Bio received an initial payment of $5 million and will also be eligible for additional future milestone payments and royalties from Corteva's future sales of the products. Another major step for Lavie Bio was the recent announcement in February 2024 of the agreement with Syngenta for the discovery and development of new biological insecticidal solutions. The collaboration will leverage Lavie Bio's unique technology platform to rapidly identify and optimize bioinsecticide candidates. These two collaborations strengthen Lavie Bio's financial position and overall perception in the agriculture market. Now, let's move from collaborations to product sales. Lavie Bio's first bio-inoculant product, Yalos, achieved several impressive milestones. In May 2023, Yalos obtained regulatory approval from the Canadian Food Inspection Agency, expanding its sales territory significantly and tripling its reach.
In November 2023, Yalos expanded its scope to include durum and barley varieties across the U.S. and Canada. This expansion followed successful field trials in 2023, demonstrating an average of approximately 7% of yield increase in durum and barley. In December 2023, Lavie Bio secured an exclusive distribution agreement with WinField United Canada for Yalos, aiming to drive sales growth in key Canadian agriculture regions, including Saskatchewan, Alberta, and Manitoba. The focus of the distribution agreement is on spring wheat, durum, and barley crops. Overall, Yalos made significant strides in regulatory approval, product expansion, and distribution partnerships, positioning it as a valuable tool for enhancing crop productions and addressing environmental challenges in the agriculture industry. Looking forward to 2024, Lavie Bio will continue to focus on three main pillars. The first will be to grow the sales and distribution of the company's bio-inoculant product, Yalos, in the U.S. and Canada.
The second is to continue driving the company's pipeline of innovative products towards commercialization, including special focus on the company's strategic partnership with Corteva, ICL, and the recent one with Syngenta. The last pillar will be to continue advancing the company's unique technology platform, the CPB, powered by Evogene MicroBoost AI tech engine with new tools and capabilities. Finalizing my review of our subsidiaries, I would like to update on Canonic, which provides tailored medical cannabis products. Following my previous update in Q3 2023, in which we noted that we have decided to reduce our investment in Canonic due to the challenging market conditions of the medical cannabis sector, we have recently engaged in advanced discussions relating to the potential transfer to a third party of Canonic's operations. There is no assurance that such transfer will be completed or on what terms.
We will continue to update you on this matter. No doubt, 2023 was an exciting year for the Evogene Group, filled with achievements. Looking forward to 2024, we expect it to see continued growth and additional collaborations benefiting from Evogene's three AI tech engines. We ended 2023 with a solid cash balance of approximately $31.1 million and are expecting additional cash injections from collaborations and product sales. This concludes my review of the Evogene Group activities. Now, your host, Zohar, Casterra's new CEO, will take the lead.
Thank you, Ofer, and good day, everyone. I would like to start by thanking the exceptional team at Casterra for welcoming me during this pivotal moment for the company and expressing my sincere gratitude to the Evogene management for their support. As we face the challenges ahead, I'm filled with optimism driven by the great potential I see in Casterra.
Ensuring a reliable and stable supply of castor seeds is crucial in meeting our customers' demands while contributing positively to local economies. Our recently signed agreements with seed producers in Africa and Brazil strengthen our supply chain and mark a strategic change towards diversifying our production sources. I believe Evogene's innovative AI technology will play a crucial role in shaping the future of castor seeds, solidifying Casterra's position as a world leader in the field. Together, I'm confident that we will leverage this technology to maintain Casterra's competitive edge and achieve unparalleled success in the global market.
Thank you, Yoash. As of December 21, 2023, Evogene had consolidated cash, cash equivalent, and short-term bank deposits of approximately $31.1 million. Evogene, together with Casterra, Canonic, and AgPlenus, possessed an aggregate of $12.4 million in cash, Biomica $12.7 million, and Lavie Bio $6 million.
In July 2023, the company entered into securities purchase agreements with institutional investors in a registered direct offering of shares only. The gross profits from the offering were approximately $8.5 million. Looking ahead to 2024, we expect an approximate cash usage of $8 million, excluding Lavie Bio and Biomica, which is a significant decline compared to $12.5 million in 2023. This decline is mainly attributable to an expected increase in revenue in 2024 and a decrease in expenses due to the decline in economic activity. The total consolidated burn rate is expected to decline in 2023 as well to $21 million compared to $23.1 million in 2023. We do not have any bank notes. I would like now to highlight some specific items on the P&L. Revenues for 2023 were approximately $5.6 million in comparison to approximately $1.7 million in 2022.
The increase in revenues was primarily due to $2.5 million generated by Lavie Bio as a license increase in the frame of its collaboration with Corteva, as well as the revenues recognized from Casterra's sale of castor seeds. R&D expenses for the fourth quarter of 2023, which are reported net of non-refundable grants, were approximately $5.5 million in comparison to approximately $4.8 million in the same period in the previous year. R&D expenses for the full year 2023 were approximately $20.8 million and remained stable compared to 2022. The main contributors to R&D expenses during 2023 were Lavie Bio's activities and Biomica's development efforts. Sales and marketing expenses for the fourth quarter of 2023 were approximately $1 million, reflecting a slight decrease compared to approximately $1.2 million in the same period the previous year.
For the full year 2023, sales and marketing expenses were approximately $3.6 million in comparison to approximately $3.9 million in 2022. General and administrative expenses for the fourth quarter of 2023 were approximately $1.2 million in comparison to approximately $1.7 million in the same period in the previous year. For the full year 2023, general and administrative expenses were approximately $6.1 million in comparison to approximately $6.5 million in 2022. The decrease was mainly attributed to the decrease in the cost of directors and officers' insurance. Other income in the fourth quarter of 2022: the company received $3.5 million from buyers under the Joint Seed Traits collaboration agreement as part of restructuring and release of the patent filing, prosecution, and maintenance obligations under the collaboration.
Operating loss for the fourth quarter of 2023 was approximately $7.6 million in comparison to an operating loss of approximately $3.8 million in the same period in the previous year. The increase in the operating loss was mainly due to the other income recorded in the fourth quarter of 2022, as mentioned above. Operating loss for the full year 2023 was approximately $26.5 million in comparison to $26.9 million in 2022, mainly due to the significant increase of revenues in 2023 offset by the other income recorded in 2022. Financial income net for the fourth quarter of 2023 was approximately $297,000 compared to approximately $6,000 in the same period in the previous year. Financial income net for the full year 2023 was approximately $521,000 compared to financing expenses of approximately $2.8 million in the same period in the previous year.
The difference between periods was mainly due to the U.S. dollar and the New Israeli Shekel exchange rate, a change in the value of marketable securities, and an interest income compared to the same period in the previous year. Net loss for the fourth quarter of 2023 was approximately $7.3 million in comparison to a net loss of approximately $3.8 million in the same period in the previous year. The increase in net loss during the fourth quarter of 2023 is mainly due to other income received in 2022, as mentioned above. Net loss for the full year 2023 was approximately $26 million in comparison to a net loss of approximately $29.8 million for 2022. With that, both Ofer and I would now like to open the call for any questions you may have.
Thank you. Ladies and gentlemen, at this time, we will begin the question-and-answer session.
If you have a question, please press star one. If you wish to cancel your request, please press star two. If you're using speaker equipment, kindly lift the handset before pressing the numbers. Your questions will be pulled in the order they are received. Please stand by while we pull for your questions. The first question is from Ben Klieve of Lake Street Capital . Please go ahead.
All right. Thank you for taking my questions. A few questions, the first couple regarding Casterra. You talked about the increased access to farmers supplying you with castor seed. I'm wondering if you can characterize, if you feel confident that you have enough inventory to fill the entirety of the initial $11.3 million order in 2024. Do you guys feel comfortable with the inventory that you're going to have to do that, and do you think there's any variability there?
Hi, Ben.
This is Ofer. Yoash is also online. Yoash is the CEO of Casterra. We believe that we would be able to supply the orders we receive in 2023 during 2024. A fraction will come from seed production that was initiated during 2023, and now it's on its way. The rest will come from production that we are going to conduct during this year, which this is part from what we announced during the last quarter. The answer to your question is yes.
Great. That's great. Thank you. A follow-up question to this, then, is regarding a follow-on order from this unnamed energy partner. Can you characterize what is needed in order for a follow-on order to be received? Do you guys need to deliver fully before you think they will commit to a follow-on order?
Is there ongoing discussions about a follow-on order currently? What can you help us understand about expectations and timing around that?
We are already starting to talk with our partners with respect to orders for year 2025. I believe that the main challenge is still to be able to produce the needed quantity for year 2025. In a way, our plans for the year 2024 is to produce castor seeds not just in order to supply the existing purchase order we received in 2023. Our target is also to end the year with inventory and seed production in the field that will support the demand for 2025. Bottom line, apart from our progressing in supplying the seeds for this year, we are expecting also to receive orders for next year, and we will start the production during 2024 as preparation for 2025.
Great. Great.
That's very helpful. Thank you, Ofer. Pivoting over to Canonic. In your prepared remarks, Ofer, you talked about kind of the strategic review that's going on there and looking at your options. Is your hope for Canonic that this is something that Evogene will still retain ownership of but maybe in a different structure than it is today? Or is this an operation that you think is one that is potentially going to be non-core and something that would be outside of Evogene here in coming quarters?
So I think that our final target is that, starting from this year, Canonic activity won't be material in our P&L. And the way that we are planning to achieve it is by integrating Canonic activity to other third parties that we are talking with.
Still, it's under discussion, but that is that we will stay a minority shareholder in a company, but we won't continue to invest in this activity the way that we did in the previous years. So bottom line, we might stay with some rights to equity or to other mechanisms in this field, but we will stop to invest in the cannabis industry.
Great. Great. Thank you. And then one last one from me, and then I'll get back in queue as it pertains to Lavie Bio. And I had to hop in and off of the call here when you were talking about this, so if I'm making you repeat yourself, I apologize. But can you talk about the supply chain at Lavie Bio that I know had some challenges last year?
I believe you have that supply chain really secure to really enable a more material commercial launch of Yalos here in 2024. But can you just confirm that really the inventory build in support of the commercial launch is in place? Are there any supply chain challenges that you're still working through?
So I think that in this case, I have good news. So it's really nice to see that you remember that we had some challenges in producing Yalos in 2023, in 2022. But I'm very happy to report that we successfully produced the quantity that we were targeting and even a little bit more than what we were targeting for the sale season of 2024. So we are in good shape. We changed the sole manufacturer, and we are very happy with his performance and the quality of the product.
Great. Great. Very good.
Well, I appreciate you taking my questions. Plenty more to talk about, but that's a good place to leave it. I'll get back in queue.
Thank you.
The next question is from Ben Haynor of Alliance Global Partners. Please go ahead.
Good day, gentlemen. Thanks for taking the questions. I wonder, to focus on AgPlenus and the agreements that you have there with Bayer and Corteva on the APCO-12 and the APTH1, what do we expect kind of from a development timeline there? And when and how large? Is it something you can discuss? Might some of these upfront milestone payments, royalties, etc., be as part of these agreements here?
Thank you, Ben, for this question.
First, I would like to use this question to share with the participants in this call how proud we are that we are in a position that Lavie Bio, our subsidiary in the world of ag biological, is collaborating and working with three monsters in the ag industry: ICL, Corteva, and Syngenta. And we also have AgPlenus, which is working with Corteva and also with Bayer. It's really incredible that today, in the Evogene group, we are working with almost all the first-tier type of companies. I think that only BASF is the only company that we are not working with yet, and probably this is only a question of time. So I think that this is something that's worth noting.
Well, with respect to your question, I think that both ongoing collaboration with Corteva and with Bio, they are an important part from funding of AgPlenus's activity for the next few years. There is a reason why we report on the Bio collaboration agreement in a 8-K format. I can't disclose, of course, the numbers, but as we mentioned, this agreement includes upfront payment, R&D fee, and then, of course, milestone payment and royalty. I think what is important in these two announcements is that, first, that another first-tier company choosing AgPlenus to work with to develop one of the most important products in the ag chemical industry, herbicides. And the second announcement, if you think about it, this is the first time that we have confirmation from a third party that our tech engine, ChemPass AI, and AgPlenus have succeeded to achieve a milestone.
So I think this is very important to you. Now, as I said, we expect that a significant portion from AgPlenus's expenses, budget, will be covered by these two collaborations. And I hope and believe that there will be more in the future. And I think that what we should expect in the near future is achieving additional milestones that will present the progress of this collaboration. With respect to royalty, it still will take some time. But like in the ag-biological arena, what is important is advancing in the pipeline because the value creation scheme rapidly increases when you are moving from hit to lead to optimized lead, etc., etc., etc. So this is great news for AgPlenus that we achieve first milestone in the collaboration with Corteva, and we are looking ahead to the next challenges and milestones, which we believe we'll achieve them.
Okay. Great.
And maybe just a follow-up. On the near-term milestones, are any of those expected to hit this year?
Can you repeat what you said just now?
Sure. I think you said that near-term milestones, milestone payments, is that or upcoming milestone payments, are any of those expected to be recognized this year?
So there are some milestones that we are trying to reach during this year, not necessarily in AgPlenus. There is other agreements in the group that we are targeting for. But milestones, it also depends on research activity. So yes, we are looking forward to see the progress. In some cases, we hope and believe that we will be able to achieve them. Some, there is always a challenge with respect to R&D activity. It might take a little bit longer.
But we are excited to see the current progress in all fronts with respect to our activities in our subsidiaries.
Okay. Fair enough. And then I apologize if I missed this earlier. On the 400 tons we can receive, is that sufficient? I thought I got the end of the response to one of the earlier questions. Is that enough to meet the current order and the beginning of supply for 2025? Or can you clarify on what that 400 tons of production capacity gives you?
Okay. So our target is that in order to support the demand from the purchase order we received in 2023, it's coming from three avenues. The first one is from production that took place last year, and now we are harvesting the field, packaging the seeds, and shipping them to our partners. An additional avenue is from the seed production agreement that we announced this quarter.
There is additional ongoing discussion that we are now planning to close the agreement, not just to supply the existing demand but also to start to build an inventory for 2025. So as I responded earlier, according to our plan, we believe and expect to be able to deliver not just the quantity we obligated last year, but we are also planning to build an inventory for the future purchase order for 2025.
Okay. Well, that's helpful. Thank you for really touching that. I'll leave it there. Thanks for taking the question, gentlemen, and I think that's been all the validation we've seen from third parties here recently.
Thank you.
The next question is from Brett Reiss of Janney Montgomery Scott. Please go ahead.
Hi, Ofer.
Hi.
First question, based on the crop rotation cycle, when will we definitively know that the new group of Brazilian and Kenyan farmers have been able to successfully grow and deliver the seeds so we can consummate sales?
So first, one of the reasons that we are growing in different regions is to be able to capture more than one season to grow castor. In addition, in all the areas that we are now engaged, there is an irrigation system in order to address the issue of water for the castor. I think that we are planning to probably we'll have better understanding during the second quarter or close to the end of the second quarter with respect to this question. And in any event, in our plan, we are going to engage with much more than what we need for this year to supply.
So, as I said, apart from it, it will be for the inventory for next year. But I think that during the second half the second quarter this year, we have better clarity. But at least from what we are doing now, I think that we'll be able to achieve this target.
Okay. Thank you for that. Somebody, one of the prior callers, asked about the 400 tons of production. I'm going to ask it a different way. If you're able to generate 400 tons of production, what capacity of dollar revenues can result if you're able to successfully come in with 400 tons of production?
I can't disclose this information because then our competitors will know what is the price that we are selling our product. So I prefer to keep this commercial information confidential. And this is we were hesitating what information we can disclose.
I think it was important for us to send a message that we are taking care of the production issue. So this is why we came with this press release. We prefer not to share more information because it's not for the benefit of the company.
Okay. And last one, since so much depends on you selecting the right farmers in Brazil and Kenya and monitoring them, have you marinated yourself and your team? Have they marinated themselves in Brazilian and Kenyan business culture so that we're sure we're selecting the right farmers and they deliver what they're contracted to do?
This is a very good question, and we are trying to tackle this challenge in different ways. The first one is that if in the past we worked only with two seed producers, currently, we are working with more than five, and the numbers will continue to grow.
It's in different regions. In addition, we expand significantly the number of Casterra employees. All of them are agronomists that have experience in growing castor. And a significant portion of the time, they are at our seed growers in Africa and in Brazil. As an example, Yoash is currently in the call but is located now in Kenya, where he is conducting a set of meetings with our existing seed producers and additional seed producers that we are planning to engage with them for growing for us additional castor seeds. And we have one Brazilian employee that is located in Brazil, and we are planning to open a subsidiary in Kenya that there will be local people that will work for Casterra, and they will be on the ground through the years all the time.
So in addition, I think that today, when we are choosing a seed producer, we are visiting his farm. We are checking the facility. We are doing a lot of work before we engage with them. But maybe the most important thing is that we are not choosing one seed producer and giving him all the and build all of our expectation on him like maybe we did in the past. Today, we are prepared to work with many seed producers in order to make sure that even if one of them won't achieve his target, still, we will get the overall performance will cover our expectations.
Great. Thank you for taking my questions.
There are no further questions at this time. Before I ask Mr.
Ofer Haviv to go ahead with his closing statement. I would like to remind participants that a replay of this call is scheduled to begin two hours after the conference. In the US, please call 1-888-326-9310. In Israel, please call 03-9255-901. Internationally, please call 972-392-55901. Mr. Haviv, would you like to make your concluding statement?
Yes. Thank you once again for your ongoing support. Together, we will continue to drive our company forward and create long-term value for all stakeholders. Thank you and goodbye.
Thank you. This concludes Evogene's fourth quarter and full-year 2023 results conference call. Thank you for your participation. You may go ahead and disconnect.