Faron Pharmaceuticals Oy Traumakine Update (3826W)

TIDMFARN

RNS Number : 3826W

Faron Pharmaceuticals Oy

18 August 2020

Faron Pharmaceuticals Oy

("Faron" or the "Company")

Traumakine update

- EUR2.5 million loan guarantee from Finnvera to further expand IV IFN beta-1a manufacturing process

   -     AGC Biologics selected as new commercial scale manufacturer 
   -     COVID-19 trials continue to investigate Traumakine treatment 

Company announcement, 18 August 2020 at 9.00 AM (EET)

Insider information

TURKU - FINLAND - Faron Pharmaceuticals Oy (AIM: FARN, First North: FARON), the clinical stage biopharmaceutical company, today provides an update on manufacturing plans for Traumakine, its investigational intravenous (IV) interferon (IFN) beta-1a, and the continuing clinical investigations in COVID-19 patients.

Commercial scale manufacturing

The Company has received a guarantee from Finnvera Oyj ("Finnvera") for a EUR2,500,000 loan ("Loan") which will be provided by Danske Bank A/S Finland Branch. The Loan is for a period of 7 years with Loan repayment only commencing after 2 years and is subject to certain financial covenants. Interest cost equates to approximately 4.1% per annum over Euribor . The Loan funds will be used to further expand the use of a new cell line planned to be established using the previously received Business Finland loan of EUR2,100,000, announced on 15 June 2020, and which will be used in the future commercial scale production of Faron's IV IFN beta-1a.

Finnvera is a specialised financing company owned by the State of Finland and it is the official Export Credit Agency (ECA) of Finland. For more information see: https://www.finnvera.fi/eng/finnvera/finnvera-in-brief .

Faron also announces today that AGC Biologics, a leading global Biopharmaceutical Contract Development and Manufacturing Organisation (CDMO), has been selected as the new manufacturing house for the commercial scale production of the Company's IV IFN beta-1a. As announced on 5 May 2020, AGC Biologics is also the commercial scale manufacturer of bexmarilimab, Faron's wholly-owned novel precision cancer immunotherapy (Clevegen). Faron has been very satisfied with AGC Biologics' work since that time.

"We are very happy to expand our partnership with Faron. Our priority has always been to serve our customers with a commitment to continuous innovation, aided by building strong, long term collaborative relationships," said AGC Biologics' CEO Patricio Massera.

Clinical investigations in COVID-19

Traumakine continues to be investigated as a potential COVID-19 treatment in global trials, including the World Health Organization's (WHO) Solidarity trial. In July, WHO took the decision to remove the hydroxychloroquine and lopinavir/ritonavir treatment arms from the trial due to insufficient evidence of benefit. This leaves IFN beta-1a and remdesivir as the only two drugs remaining in the trial, subject to WHO announcing further new compounds for inclusion. IFN beta-1a had previously been included in a treatment arm testing it in combination with lopinavir/ritonavir. IFN beta-1a now remains as a monotherapy.

Traumakine is used in the trial's severe patients for whom it is critical to rapidly provide high serum concentrations of IFN beta-1a and to maximise levels of the drug in the lung vasculature where peripheral circulation is slowed(1) , a condition which can be life threatening for these virally-infected patients. Recent findings show that seriously ill COVID-19 patients have compromised interferon responses(2) .

In addition to the Solidarity trial, Faron continues to investigate Traumakine in two other clinical trials, the ongoing global REMAP-CAP (Randomized, Embedded, Multifactorial Adaptive Platform Trial for Community-Acquired Pneumonia) trial, and the US HIBISCUS (Human Interferon Beta In Severe CoronavirUS) trial.

- The global REMAP-CAP trial is evaluating Traumakine as a potential treatment for community-acquired pneumonia, including in COVID-19 patients, and is currently ongoing across more than 200 sites and 14 countries.

- As previously announced, HIBISCUS will be an investigator-initiated study at Harvard Medical School's Beth Israel Deaconess Medical Center (BIDMC), focused on intensive care unit (ICU) patients with ARDS caused by a viral infection (e.g. COVID-19, influenza). Commencement of the Phase II/III pivotal, randomized, placebo-controlled study, remains subject to finalisation of funding arrangements and regulatory approval. The study will test Traumakine against both placebo and dexamethasone, which is now a part of the standard of care in the US. Further announcements will be made in due course.

Dr. Markku Jalkanen, Faron's CEO, said: "We are very pleased to have secured additional resources that will enable us to progress Traumakine manufacturing to support its potential future commercial use. The science behind interferon (IFN) beta and its potential to prevent multi-organ failure in severe COVID-19 patients is compelling. Administering an IV formulation to strengthen the body's own IFN beta production - its first line of defence against viral infection - provides optimal exposure to the lung vasculature, which is what we believe critically ill patients need. We are proud to be supporting global research efforts against COVID-19 and look forward to further data from these trials to support the potential use of IV IFN beta-1a in the future."

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 ("MAR").

References

1. Interferon beta-1a for COVID-19: critical importance of the administration route, Jalkanen et al., Critical Care (2020) 24:335 https://doi.org/10.1186/s13054-020-03048-5

2. Impaired type I interferon activity and inflammatory responses in severe COVID-19 patients, J. Hadjadj et al., Science 10.1126/science.abc6027 (2020)

For more information please contact:

Faron Pharmaceuticals Oy

Dr Markku Jalkanen, Chief Executive Officer

[e-mail]

Cairn Financial Advisers LLP, Nomad

Sandy Jamieson , Tony Rawlinson, Mark Rogers

Phone. [phone]

Panmure Gordon (UK) Limited, Broker

Rupert Dearden

Phone: [phone]

Sisu Partners Oy, Certified Adviser on Nasdaq First North

Juha Karttunen, Jussi Majamaa

Phone: [phone]

Consilium Strategic Communications

Mary-Jane Elliott, David Daley, Lindsey Neville

Phone: [phone]

E-mail: [e-mail]

Stern Investor Relations, Inc.

Julie Seidel

Phone: +(1)212 362 1200

Email: [e-mail]

About Faron Pharmaceuticals Ltd

Faron (AIM: FARN, First North: FARON) is a clinical stage biopharmaceutical company developing novel treatments for medical conditions with significant unmet needs. The Company currently has a pipeline based on the receptors involved in regulation of immune response in oncology and organ damage. Clevegen, its precision immunotherapy, is a novel anti-Clever-1 antibody with the ability to switch immune suppression to immune activation in various conditions, with potential across oncology, infectious disease and vaccine development. Currently in phase I/II clinical development as a novel macrophage checkpoint immunotherapy for patients with untreatable solid tumours, Clevegen has potential as a single-agent therapy or in combination with other standard treatments including immune checkpoint molecules. Traumakine, the Company's pipeline candidate to prevent vascular leakage and organ failures, has completed a phase III clinical trial in Acute Respiratory Distress Syndrome (ARDS). Plans for its future development are being finalised to avoid interfering steroid use together with Traumakine. Faron is based in Turku, Finland. Further information is available at www.faron.com

Caution regarding forward looking statements

Certain statements in this announcement, are, or may be deemed to be, forward looking statements. Forward looking statements are identified by their use of terms and phrases such as "believe", "could", "should", "expect", "hope", "seek", "envisage", "estimate", "intend", "may", "plan", "potentially", "will" or the negative of those, variations or comparable expressions, including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors' current expectations and assumptions regarding the Company's future growth, results of operations, performance, future capital and other expenditures (including the amount, nature and sources of funding thereof), competitive advantages, business prospects and opportunities. Such forward looking statements reflect the Directors' current beliefs and assumptions and are based on information currently available to the Directors.

A number of factors could cause actual results to differ materially from the results and expectations discussed in the forward-looking statements, many of which are beyond the control of the Company. In particular, the early data from initial patients in the MATINS trial may not be replicated in larger patient numbers and the outcome of clinical trials may not be favourable or clinical trials over and above those currently planned may be required before the Company is able to apply for marketing approval for a product. In addition, other factors which could cause actual results to differ materially include the ability of the Company to successfully licence its programmes within the anticipated timeframe or at all, risks associated with vulnerability to general economic and business conditions, competition, environmental and other regulatory changes, actions by governmental authorities, the availability of capital markets or other sources of funding, reliance on key personnel, uninsured and underinsured losses and other factors. Although any forward-looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions, the Company cannot assure investors that actual results will be consistent with such forward looking

statements. Accordingly, readers are cautioned not to place undue reliance on forward looking statements. Subject to any continuing obligations under applicable law or any relevant AIM Rule requirements, in providing this information the Company does not undertake any obligation to publicly update or revise any of the forward-looking statements or to advise of any change in events, conditions or circumstances on which any such statement is based.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [e-mail] or visit www.rns.com.

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August 18, 2020 02:00 ET (06:00 GMT)