ADALTA LIMITED — AGM Information 2019

Nov 25, 2019

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CEO report Annual General Meeting 26 November 2019

Tim Oldham, CEO and Managing Director AdAlta Limited (ASX:1AD)

Disclaimer

Investment in AdAlta is subject to investment risk, including possible loss of income and capital invested. AdAlta does not guarantee any particular rate of return or performance, nor do they guarantee the repayment of capital.

This presentation is not an offer or invitation for subscription or purchase of or a recommendation of securities. It does not take into account the investment objectives, financial situation and particular needs of the investor. Before making any investment in AdAlta, the investor or prospective investor should consider whether such an investment is appropriate to their particular investment needs, objectives and financial circumstances and consult an investment advisor if necessary.

This presentation may contain forward-looking statements regarding the potential of the Company’s projects and interests and the development and therapeutic potential of the company’s research and development. Any statement describing a goal, expectation, intention or belief of the company is a forward-looking statement and should be considered an at-risk statement. Such statements are subject to certain risks and uncertainties, particularly those inherent in the process of discovering, developing and commercialising drugs that are safe and effective for use as human therapeutics and the financing of such activities. There is no guarantee that the Company’s research and development projects and interests (where applicable) will receive regulatory approvals or prove to be commercially successful in the future. Actual results of further research could differ from those projected or detailed in this presentation. As a result, you are cautioned not to rely on forward-looking statements. Consideration should be given to these and other risks concerning research and development programs referred to in this presentation.

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AdAlta overview

AdAlta Limited (ASX:1AD) is an Australian listed drug discovery and development company generating a promising new class of protein therapeutics, known as i-bodies, for treating a wide range of human diseases.

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Introducing new CEO, Tim Oldham PhD

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Commenced 14 October 2019

20 years’ executive leadership experience in Australia, Europe and Asia

Senior pharma and biotech roles in strategic planning, business development (licensing, M&A), commercial and manufacturing operations and alliance management in pharma and biotech

Experience in complex and novel therapy commercialization pathways: biosimilars, modified antibodies, cell and gene therapies ASX Board experienced PhD, Imperial College, London; BSc/LLB, ANU

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AdAlta (1AD) investment summary

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i-body platform for generating multiple products

• Novel structure provides new way to access important biological targets that can be difficult to access with conventional approaches

Lead internal program, AD-214, due to commence human Phase 1 clinical trial in early 2020

• Targeting fibrosis of the lungs (Idiopathic Pulmonary Fibrosis), a clinical indication with high unmet medical need and early transaction potential

• USA FDA Orphan Drug Designation and strong pre-clinical data

Collaborations providing additional opportunities to leverage the i-body platform

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AD-214

• Recently secured licensing deal with global medical technology firm, GE Healthcare to develop i–bodies for diagnostic imaging

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Experienced drug development team with track record of delivery

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AdAlta business model and strategy to create value

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1. In-house
Licence to pharma
pipeline of drug Revenues: major upfronts +
AD-214
candidates milestones & royalties
Invest up to key value
inflection point
i-body drugs
i-body
technology Long loop that enables and diagnostics
platform and access to novel, challenging New drug class
drug targets Potential in multiple
library disease indications
2. Pharma and Co-develop with
biotech pharma
partnerships Revenues: research fees &
royalties
Partner-led target selection
and development
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AdAlta pipeline

	Partner	Partner	Partner			Product/ Indication	Target	Class of Target	Discovery	Preclinical	Manufact- uring IND enabling studies	Phase I
						AD-214: Idiopathic Pulmonary Fibrosis	CXCR4	GPCR
i-body discovery engine						AD-214: Other fibrotic indications Not disclosed Not disclosed Not disclosed	CXCR4 MCP-1 TRPV4 Not disclosed	GPCR Novel ligand pocket Ion channel GPCR			Binders obtained to 20 separate targets (10 are GPCRs and ion
						Diagnostic agents	Granzyme B + others	Serine protease			channels)

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AD-214 has broad application in treating fibrosis

AdAlta data in animal models and human tissue studies suggests that AD-214 can improve fibrosis and inflammation across a range of fibrotic diseases

LUNG: Idiopathic Pulmonary Fibrosis EYE: Wet-Age Related Macular Degeneration LIVER: NASH

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Lung
IPF
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Eye Liver
Wet-AMD & PVR NASH & CIRRHOSIS
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SKIN: Hypertrophic scar KIDNEY: Chronic kidney disease

Fibrotic diseases are recognised in almost every organ

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Kidney Skin
RENAL FIBROSIS SCLERODERMA
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Market opportunity for IPF

Idiopathic Pulmonary Fibrosis (IPF) is an irreversible, unpredictable and incurable disease

THE STATISTICS

People living with IPF 300,000

People die from IPF every year 40,000

Median length of survival after IPF diagnosis

3.8 years

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AdAlta’s place in the IPF treatment landscape

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FDA approvals of pirfenidone and nintedanib in 2014 has led to greater confidence in the development of drugs for IPF

• Neither are optimal therapies - the disease process is slowed, not reversed

A number of products in development

• Provide pathway for Phase II and III trials

No IPF treatments under development targeting CXCR4

• Existing approved CXCR4 small molecule antagonist Mozobil very different pharmacology to AD-214 and toxic when provided in chronic setting

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High unmet medical need: there is a significant opportunity for multiple classes of drug to be clinically valuable and commercially successful for the management of IPF patients

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AD-214 novel treatment for fibrosis – lung

AdAlta’s lead i-body has demonstrated in vivo activity (reduced collagen content, reduced inflammatory cell infiltration, improved tissue architecture) in a Bleomycininduced mouse model of lung fibrosis

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Normal lung tissue

IPF lung tissue (lung disease mouse model)

IPF lung tissue + AdAlta anti-CXCR4 i-body dosed for 21 days (lung disease mouse model)

Blue staining represents collagen, a hallmark of fibrosis

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AD-214 safe in 4-week toxicology study

RECENT DATA

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3 non-human primate studies completed

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Most recent: a Good Laboratory Practice (GLP) study to evaluate safety and toxicology prior to initial human studies

• 10mg/kg, 30mg/kg and 100mg/kg multiple doses over four weeks plus recovery

• AD-214 well tolerated with no deaths, no AD-214-related clinical signs, no changes in a panel of clinical observations, and only slight transient and completely reversible haematology changes

Tox study results were in line with expectations and in keeping with previous studies

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AD-214 development: key milestones

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2019 2020
Q3 Q4 Q1 Q2 Q3 Q4
Next steps
•
Manufacture drug product (vialling) and placebo
•
Finalise engagement of clinical trial partners
Toxicology studies
• Finalise Phase 1 study protocol and prepare ethics
committee submission
Clinical study final design
and GMP manufacturing
Phase I program
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GE Healthcare licensing deal – i-body platform

Overview:

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Agreement with global medical technology and diagnostics firm, GE Healthcare

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AdAlta will screen its novel i-body library on a number of targets in order to identify i-bodies that GE can use as imaging agents, starting with Granzyme B

Summary of commercial terms:

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First payment of GBP100,000 now due following target selection

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GE Healthcare will pay AdAlta for research costs

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Further milestone payments and royalties expected if development successful

AdAlta aims to develop a range of therapeutic and diagnostic partnerships

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Market benchmarks

enchmarks
Sep-15 acquired by Roche $105m + $475m milestones phase I Nov-19 acquired by Roche $390m + $1b – Phase II Aug-15 BMS option to buy $150m + $1.25b milestones Jul-19 license by Boehringer Ingelheim €45m + €1.1b phase I		Jul-19 license by Boehringer Ingelheim €45m + €1.1b phase I		Nov-19 acquired by Roche $390m + $1b – Phase II Aug-15 BMS option to buy $150m + $1.25b milestones
April-16 license by Abbvie $40m upfront + $645m milestones & royalties		Feb-18 collaboration with Seattle Genetics (3 targets) $30m upfront + $1.2b milestones & royalties		Feb-18 acquired by Sanofi €3.9b
Feb-15 acquired by Sosei $400m Phase Ib asset + 7 pre- clinical leads		Jul-15 acquired by Celgene $7.8b Ph III, Ph II and GPCR platform		April-16 license with Boehringer €8m + €125m milestones PhI GPCR nanobody
Feb-15 acquired by Sos $400m Phase Ib asset + 7 clinical leads

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Significant 2019 achievements

AD-214

• ✓ Successfully completed AD-214 cell-line and manufacturing process development; completed manufacturing of clinical AD-214 bulk drug substance

• ✓ Completed Phase I-enabling non-human primate toxicity (safety) studies (pharmacology data pending)

i-body platform partnerships

• ✓ Entered partnership with GE Healthcare to develop pre-clinical targets for diagnostic imaging – received first ever partnering revenue

Pipeline research

• ✓ Key data published in mABs peer reviewed scientific journal, i-body half-life customisation

• ✓ Entered partnership with Excellerate Biosciences to accelerate characterization of GPCR binders

Organisation

• ✓ Board skills expanded with appointment of Dr Ros Wilson

• ✓ Appointment of new CEO & Managing Director, Dr Tim Oldham

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Financial position

Key financial details
ASX code	1AD
Share price (25 November 2019)	AUD$0.12
Market capitalisation	AUD$22.18m
Ordinary Shares	164,302,007
Listed Options	23,348,803
Unlisted Options	2,605,007
Current cash (30 September 2019)	AUD$7.59m
Trading range (last 12 months)	AUD$0.11 to $0.30
Average daily volume	197,582

Major shareholders	%
Yuuwa Capital LP	32.90
Platinum Asset Management	8.64
Brispot Nominees Pty Ltd	4.65
Citycastle PtyLtd	3.67
Meurs Holdings PtyLtd	3.04
Other shareholders	47.09
Total	100%

Share price performance (last 12 months)

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Retail,
22.12%
HNWs > 500K
Shares,
13.88% Institutional,
57.95%
Founding
Universities,
2.83%
Board &
Management,
3.22%
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Financial results

AUD million

Financial year cash flows

Cash	FY18	FY19
	(AUD million)	(AUD million)
Operating inflows Operating outflows	1.86 5.79	2.11 7.93
Financing cash flows	0.01	9.24
Starting cash Ending cash	6.22 2.31	2.31 5.56

Quarterly cash flows

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Net inflows
10 Net outflows
Cash at end of quarter
8
6
4
2
0
(2)
(4)
(6)
Q1 Q2 Q3 Q4 Q1 Q2
FY19 FY19 FY19 FY19 FY20 FY20(F)#
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Key drivers

• Capital raising Q1FY19 ($4.3m) and mid-2019 ($7.0m)

• R&D Tax refund Q2FY19 ($2.0m) and Q1FY20 ($3.5m)

• Outflows increasing due to external project costs associated with manufacturing process development, NHP toxicology study, GMP manufacturing

Outlook

• Q2FY20 is largest operating cash outflow of FY20

• Funded into Phase 1 clinical studies

• Cash balance plus cash management strategies fund the Company into Phase 1 clinical studies

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* Net inflows include R&D Tax Incentive and proceeds of capital raising activity after capital raising costs; net outflows
18 includes all operating expenses and purchases of capital equipment
# Excludes inflows from licensing revenue (GE contract) and planned non-dilutive cash management initiatives
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First month reflections

Current CEO priorities

1. Commence AD-214 clinical program

2. Deliver GE contract

3. Develop growth/expansion strategy

AD-214

Platform

Strategy

• Busy but achievable plan to reach clinic Q1 2020

• Manufacturing

• Clinical material available

• Expected process improvement opportunities exist

• Data for numerous indication expansion options

• Demonstrated ability to bind additional targets

• Opens up additional product opportunities

• Opportunities to ”industrialise” discovery

• Improves productivity, IP extension potential

• Clear, confirmed opportunity to build a multi-product pipeline

• Major shareholders generally supportive of expanding development activity in an appropriately measured way

• Partnering: Company is “on the radar” of the industry based on inbound enquiries in first month

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FY20 news flow

New milestones

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H2 2019

• Partnership announcement – GE partnership September 2019

• Publication of key i-body data in well recognised, peer reviewed scientific journal, mAbs

• 4-week NHP toxicology study – completed October 2019 (plus GMP production of AD214 bulk for Phase I study)

• Publication of further key i-body/fibrosis data – estimated February 2020

• Cash runway extension strategies

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H1 2020

• Additional pre-clinical PK/PD results

• Update on i-body pipeline development and strategy

To include

• AD-214 clinical development strategy

• • New priority targets for i-body discovery and development

• Phase I human clinical studies with AD-214 commence

• Initial single ascending dose component: dosing completed

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AdAlta Limited (ASX:1AD) Summary

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Platform technology for multiple pipeline products and partnerships Lead asset AD-214

• Has significant pre-clinical validation demonstrating broad anti-fibrotic and anti-inflammatory effects as well as safety.

• Initial focus on treating Idiopathic Pulmonary Fibrosis (IPF). Market history of early commercialisation transactions in fibrosis

• Key manufacturing and toxicology milestones achieved

• Set to be in clinic by Q1 2020

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Additional expansion opportunities through partnering

• Recent licensing deal with global medical technology firm, GE Healthcare, to develop i-bodies for diagnostic imaging: first licensing revenue received

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Experienced leadership to drive AD-214 development, partnerships and pipeline expansion

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Cash balance and cash management strategies sufficient to fund the Company into Phase 1 clinical studies for AD-214

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Contact us:

Dr Tim Oldham, CEO & Managing Director t.oldham@adalta.com.au | +61 403 446 665 www.adalta.com.au

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