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Moberg Pharma

Quarterly Report May 10, 2022

3174_10-q_2022-05-10_a27299ff-96ae-483d-8c87-9adaf238512c.pdf

Quarterly Report

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Interim report January – March 2022

Moberg Pharma AB (Publ)

EUROPEAN MARKETING AUTHORIZATION APPLICATION SUBMITTED AND NORTH AMERICAN PHASE 3 STUDY STARTED

"In March, the company submitted a marketing authorization application for MOB‐015 in Europe – a key milestone in our journey to launch a new and improved nail fungus drug. The new North American Phase 3 study has started and is fully financed thanks to the guaranteed rights issue," says Anna Ljung, CEO of Moberg Pharma.

FIRST QUARTER JAN‐MAR 2022

  • EBITDA SEK ‐4.8 million (‐5.4) *
  • Operating profit (EBIT) SEK ‐5.4 million (‐6.1) *
  • Profit after tax SEK ‐4.4 million (‐5.0) *
  • Total profit SEK ‐4,4 million (18.6)
  • Diluted earnings per share SEK ‐0.10 (0.46) *
  • Cash and cash equivalents amounted to SEK 73.4 million (133.6)

* All comparative figures refer to continuing operations

SIGNIFICANT EVENTS IN THE FIRST QUARTER

  • Moberg Pharma submitted a marketing authorization application for MOB‐015. The company has submitted the registration application in Europe through the decentralized process, and market approval is expected in 2023.
  • Moberg Pharma submitted regulatory filing for the next clinical Phase 3 study to the FDA. The purpose of the new study is to facilitate market approval in the U.S. as well as strengthen the product's clinical evidence and marketing claims globally.
  • The Nomination Committee proposed Kerstin Valinder Strinnholm as the new Chairman of the Board of Moberg Pharma and Anders Lundmark as a new Director on the Board.
  • Exercise of warrants of series 2020:1 provided the company with approximately SEK 7.6 million before issue costs.

SIGNIFICANT EVENTS AFTER THE QUARTER

  • The Board of Directors has resolved to carry out a fully guaranteed issue of new ordinary shares with preferential rights for existing shareholders of approximately SEK 121 million before transaction costs. The Board of Directors' rights issue resolution was approved at the Extraordinary General Meeting on 3 May 2022. The net proceeds will be used for registration activities and clinical work for MOB‐015.
  • Enrollment of patients has begun for the Phase 3 study for MOB‐015. The randomized, multicenter, vehicle‐controlled Phase 3 study will include approximately 350 patients in North America.

STATEMENT FROM THE CEO

In March, the company submitted a marketing authorization application for MOB‐015 in Europe – a key milestone in our journey to launch a new and improved nail fungus drug. The new North American Phase 3 study has started and is fully financed thanks to the guaranteed rights issue.

The submission of the marketing authorization application for MOB‐015 to the Swedish Medical Products Agency was the most important event in the quarter. The company submitted the application in Europe through the decentralized procedure with the Swedish Medical Products Agency as the reference member state. Moberg Pharma submitted a full application, which offers the possibility of data exclusivity in Europe for up to 10 years following market approval. Our goal remains unchanged: to receive the first market approval and launch MOB‐015 in 2023.

Concurrent with the marketing authorization application, an additional Phase 3 study in North America has been launched. Moberg Pharma submitted regulatory filing for the new study to the FDA in March of this year and has begun enrolling patients in the study. The randomized, multicenter, vehicle‐controlled Phase 3 study will include approximately 350 patients in the U.S. and Canada. The patients will be evaluated over 52 weeks and the primary endpoint will be the proportion of subjects achieving complete cure of their target nail. The study design builds on the experience gained from the previous Phase 3 studies. Moberg Pharma will cooperate with the same CRO, lead investigator and successful sites from the previous North American study. The purpose of the new study is to facilitate market approval in the U.S. as well as strengthen the product's clinical evidence and marketing claims globally.

The submission of the marketing authorization application in Europe and start of the Phase 3 study in North America are two key milestones this year, and now that they have been achieved it is the perfect time to welcome Kerstin Valinder Strinnholm, who has been proposed as the new Chairman of the Board, and Anders Lundmark, one of our major shareholders and proposed as a new Board Director by the Nomination Committee. Current Chairman and founder Peter Wolpert is leaving the Board but will remain one of our major owners. Fredrik Granström is also stepping down from the Board but will retain his role as our legal advisor. I want to take this opportunity to warmly thank Peter and Fredrik for the invaluable efforts on behalf of Moberg Pharma.

The Board of Directors' resolution on a fully guaranteed rights issue in May will provide the company with approximately SEK 121 million before transaction costs. The financing we have secured gives us the opportunity to fully exploit MOB‐015's potential. With financing secured, the team can now fully focus on the registration process, the clinical study and the preparations together with our partners ahead of the launch in 2023.

Anna Ljung, CEO of Moberg Pharma

ABOUT MOBERG PHARMA AND MOB‐015

Moberg Pharma's goal is to make MOB‐015 the world's leading treatment for nail fungus and to build a specialty pharmaceutical company with its own sales in the U.S. and sales through partners in other markets. With MOB‐015 as an anchor, Moberg Pharma intends to expand the product portfolio with additional products in adjacent areas either developed in‐house or acquired.

MOB‐015 is a next‐generation treatment for onychomycosis (nail fungus) and the high antifungal effect shown in clinical Phase 3 studies with more than 800 patients indicates that the product has the potential to become the future market leader in nail fungus. Moberg Pharma has signed license agreements with partners in Europe, Japan, Canada and the Republic of Korea for MOB‐015. The annual sales potential for MOB‐015 is estimated at USD 250–500 million.

MOB-015
Nail fungus affects 10%, more common among older people
Topical terbinafine for treatment of nail fungus
Target profile: Rapid, visible improvement, superior cure rate and shorter treatment time
World-leading anti-fungal effect
76% mycological cure in Phase 3
1000x higher concentration of terbinafine in the nail compared to oral terbinafine
40x higher concentration of terbinafine in the nail bed compared to oral terbinafine
Negligible systemic levels of terbinafine
Estimated annual sales potential
USD 250-500 million
Partners in Europe, Japan, Canada and the Republic of Korea
Goal to receive the first market approval and launch MOB-015 in 2023
European marketing authorization application submitted in March 2022 through the
decentralized process. Market approval is expected in 2023.
Phase 3 studies completed in North America, n=365, and Europe, n=452. Primary
۰
endpoints reached without serious side effects
New Phase 3 study for North America initiated 2022, plan to include 350 patients
٠
Patent protection until 2032
Patents granted in major markets, including the U.S., the EU, Canada, Japan and China
Patents include new topical formulations of allylamines (including terbinafine) and
۰
treatment methods for nail fungus using the new formulations

SIGNIFICANT MEDICAL NEED – MORE THAN 100 MILLION PATIENTS IN THE EU AND U.S. HAVE NAIL FUNGUS

Despite that one out of every ten people suffers from nail fungus, there currently aren't any good treatment alternatives available. The most effective treatment is oral terbinafine, which is associated with the risk of liver damage and interaction with other drugs. Dermatologists around the world agree on the great need for better topical treatments without the risk of systemic side effects. In a survey in the U.S., 72% of responding physicians avoid prescribing oral terbinafine due to their patients' concern about side effects, and 62% would prefer a product with MOB‐015's intended target profile to current topical treatments. Only 6‐15% of responding physicians would continue to prescribe current topical treatments.1

1 Survey of 89 U.S. physicians (dermatologists and podiatrists), LifeSci Physician Survey, April 4, 2017

RESULTS FROM THE TWO PHASE 3 STUDIES SHOW THAT MOB‐015 HAS UNIQUE ANTIFUNGAL EFFECT

In December 2019, the results were presented from the first of two clinical studies in the Phase 3 program for MOB‐015, followed by the results of the European study in June 2020. Both studies met the primary endpoint. Mycological cure (eradicating the fungal infection) was achieved in 76 percent of the patients (70 percent of the patients in the North American study and 84 percent of the patients in the European study), which is substantially higher than reported for other topical treatments (30‐54 percent). Furthermore, the onset of the antifungal effect is more rapid than for oral terbinafine, with MOB‐ 015 delivering 55–78 percent mycological cure at 6 months (vs 40 percent for oral terbinafine) and 37–46 percent already at 3 months (vs 15 percent for oral terbinafine).

MOB‐015 is the first topical treatment with a mycological cure rate at the same level as oral terbinafine, the current gold standard for treatment of onychomycosis. Before the recently completed clinical Phase 3 studies with MOB‐015, it appeared unrealistic that a topical treatment would achieve a mycological cure rate of 70 percent. Furthermore, the concentration of terbinafine has been shown to be 1000X higher in the nail, 40x higher in the nail bed and 1000X lower in plasma compared to oral terbinafine – ideal characteristics for an effective tropical treatment without systemic exposure.

FIRST LAUNCH PLANNED IN 2023

In March 2022, Moberg Pharma submitted the registration application for MOB‐015 to the Medical Products Agency in Sweden, which has agreed to be reference member state for the application. The company has submitted the registration application in Europe through the decentralized process, and market approval is expected in 2023. Moberg Pharma has submitted a full application, which offers the possibility of data exclusivity in Europe for up to 10 years following market approval. The company's goal is to receive its first market approval and launch MOB‐015 in 2023.

START OF NORTH AMERICAN PHASE 3 STUDY

For market approval in the U.S., the FDA normally requires two studies that demonstrate superiority (statistically superior to the comparator) for the primary endpoint. An additional study is now being implemented to enable registration in the U.S. market. Moberg Pharma submitted documentation on the new study to the FDA in March 2022 and the first patient was enrolled in May. The randomized, multicenter, vehicle‐controlled Phase 3 study will include approximately 350 patients in North America. The patients will be evaluated over 52 weeks and the primary endpoint will be the proportion of subjects achieving complete cure of their target nail. The study design builds on the experience gained from the previous Phase 3 studies. Moberg Pharma will cooperate with the same CRO, lead investigator and successful sites from the previous North American study. The purpose of the new study is to facilitate market approval in the U.S. as well as strengthen the product's clinical evidence and marketing claims globally.

AGREEMENTS WITH STRONG PARTNERS IN PLACE – U.S. RIGHTS RETAINED

In total, five agreements are in place with commercial partners for MOB‐015: with Cipher Pharmaceuticals for Canada; Taisho in Japan; DongKoo, the market leader in dermatology, in the Republic of Korea; Allderma in Scandinavia; and the Consumer Health division of Bayer AG, a world leader in OTC fungus treatments with the brand Canesten, for Europe.

The agreements give these partners exclusive rights to market and sell MOB‐015 in each respective market, while Moberg Pharma assumes production and supply responsibility. Within the framework of the agreements Moberg Pharma can receive milestone payments of up to a total USD 120 million upon successful development and commercialization, in addition to royalties and compensation for delivered products.

Previously, Moberg Pharma has successfully commercialized products in the U.S. and therefore has retained the rights to MOB‐015 for the U.S. market. The aim is to repeat the journey taken with Kerasal Nail®, where Moberg Pharma combined direct sales in the U.S. with strategic collaborations in other major territories. The most important markets for MOB‐015 are expected to be the U.S., EU, Japan, Canada and China, all with patent protection until 2032.

PROVEN COMMERCIAL MODEL

Moberg Pharma commercialized its first‐generation nail fungus product – Kerasal Nail® ‐ and built an OTC business with annual revenue of SEK 440 million, a 30% market share in the U.S. and more than 30,000 sales locations, including the major chains CVS, Walgreens and Walmart. In 2019, the OTC business was successfully divested for SEK 1.4 billion. The company's aim is now to repeat this journey with MOB‐015, a product with much greater potential.

SEK 121 MILLION IN FINANCING FOR MOB‐015 VIA FULLY GUARANTEED RIGHTS ISSUE

In April, the Board of Directors resolved to carry out a fully guaranteed issue of new ordinary shares with preferential rights for existing shareholders of approximately SEK 121 million before transaction costs. The Board's decision on the rights issue was approved by the the Extraordinary General Meeting on May 3. The net proceeds will be used for registration activities and clinical work for MOB‐015 and mean that the new North American Phase 3 study is fully financed.

Preliminary timetable:
May 11, 2022 Record date for the right to subscribe for ordinary shares by exercising subscription rights
May 13, 2022 – May 23, 2022 Trading in subscription rights
May 13, 2022 – May 27, 2022 Subscription period
May 31, 2022 Announcement of outcome of the rights issue

Complete terms and conditions and instructions for the rights issue as well as other information on the company will be provided in the prospectus to be made public before the commencement of the subscription period.

6

FINANCIAL OVERVIEW

REVENUES AND PROFIT

First quarter (January ‐ March 2022)

Moberg Pharma's operations consist of research and development, business development and administrative functions. The majority of the development expenditure incurred is directly attributable to the development project MOB‐015 and is capitalized. The largest quarterly expense items therefore consist of business development and administration expenses of SEK 4.9 million (5.7) followed by research and development expenses of SEK 0.6 million (1.2).

The BUPI project was distributed to the shareholders on February 4, 2021. The comparative figures in the consolidated income statement show the impact on earnings of the divested BUPI project as a separate item in the consolidated income statement. For the parent company, on the other hand, amounts recognized in the income statement have not been separated for continuing operations. A profit and loss account for discontinued operations is presented in Note 2.

CASH FLOW

First quarter (January ‐ March 2022)

Cash flow from operating activities was SEK ‐6.0 million (‐14.0). Cash flow from investing activities was SEK ‐22.5 million (‐4.7) and relates to capitalized expenditure for the new North American Phase 3 study. The total change in cash and cash equivalents in the quarter was SEK ‐29.2 million (104.3). Cash and cash equivalents amounted to SEK 73.4 million (133.6) at the end of the period.

INVESTMENTS

Investments in intangible assets in the quarter relate to capitalized expenses for MOB‐015 of SEK 22.5 million (4.7).

R&D expenses (costs and investments) Jan‐Mar Jan‐Mar Jan‐Dec
(SEK thousand) 2022 2021 2021
R&D expenses (in statement of comprehensive income) ‐585 ‐1,207 ‐3,449
Capitalized R&D investments ‐22,520 ‐4,679 ‐31,309
Depreciation/amortization booked to R&D expenses 421 384 1,696
Change in R&D investments (in statement of financial position) ‐22,099 ‐4,295 ‐29,613
Total R&D expenditure ‐22,684 ‐5,502 ‐33,062

LIABILITIES

As at the balance sheet date, the Group has no interest‐bearing liabilities (excluding leasing liabilities).

CHANGES IN EQUITY

SHARES

Share capital at the end of the period was SEK 4,668,112, where the total number of shares outstanding was 46,681,123 ordinary shares with a quotient value of SEK 0.10. Moberg Pharma holds 1,464,746 repurchased ordinary shares at the end of the period.

SHAREHOLDER INFORMATION

The company's largest shareholders per March 31, 2022:

Shareholders Number of shares % of votes and capital
ÖSTERSJÖSTIFTELSEN 5,471,825 11.7
FÖRSÄKRINGSAKTIEBOLAGET, AVANZA PENSION2 4,369,176 9.4
BANQUE CANTONALE VAUDOISE, W8IMY 1,612,800 3.5
MOBERG PHARMA AB 1,464,746 3.1
NORDNET PENSIONSFÖRSÄKRING AB 1,221,539 2.6
ABN AMRO GLOBAL CUSTODY SERVICES NV, W8IMY 1,036,407 2.2
LUNDMARK, SVEN ANDERS 784,166 1.7
ÖHRN, MARTIN LENNART 541,855 1.2
DáNILO LEISOW, MATTIS 520,000 1.1
ATTERKVIST, STELLAN 448,000 1.0
OLELIND, ÖRJAN 400,601 0.9
GUNNARSSON, MIKAEL 340,000 0.7
BERGER, GUNVALD 336,666 0.7
SAXO BANK A/S CLIENT ASSETS 319,997 0.7
POLSKI, DANIEL 293,786 0.6
PLAIN CAPITAL BRONX 268,305 0.6
HANDELSBANKEN LIV FÖRSÄKRINGSAKTIEBO 263,086 0.6
OLSSON, ROBERT 250,000 0.5
FÖRSÄKRINGSAKTIEBOLAGET SKANDIA (PUB 225,001 0.5
PERSSON, JAN CHRISTER 223,678 0.5
TOTAL, 20 LARGEST SHAREHOLDERS 20,391,634 43.7
Other shareholders 26,289,489 56.3
TOTAL 46,681,123 100

SHARE‐BASED COMPENSATION PLANS

As at the reporting date, the number of outstanding instruments was 1,352,000 performance share units, with a maximum potential dilution of 3.0%. Performance share units are issued and held in trust, where the actual number of shares that can be transferred varies depending on the share's performance and that the company meets its business goals over several years. For detailed information on the incentive programs, see the 2021 Annual Report.

PARENT COMPANY

Moberg Pharma AB (publ), corp. reg. no. 556697‐7426, is the parent company of the Group. The operations of the Group are primarily conducted in the parent company and consist of research and development, business development and administrative functions.

8

2 Includes 435,399 shares owned by the company's Chairman, Peter Wolpert, through an endowment insurance policy.

For the period January to March 2022, the parent company's operating profit was SEK ‐5.4 million (‐5,9), while profit after financial items was SEK ‐5.4 million (‐5,9). Cash and cash equivalents amounted to SEK 73,4 million (133,6) at the end of the period. Bound equity was equivalent to 349,5 million (300,2).

OTHER INFORMATION

ORGANIZATION

Per March 31, 2022, Moberg Pharma had 8 employees, of whom 100% were women. All were employees of the parent company.

RISK FACTORS

Commercialization and development of pharmaceuticals are capital‐intensive activities exposed to significant risks. The risk factors considered to be of particular significance for Moberg Pharma's future development are linked to the results of clinical trials, regulatory actions, patents and trademarks, key personnel, sensitivity to economic fluctuations, future capital requirements, and financial risk factors. A description of these risks can be found in the company's 2021 Annual Report on page 21.

OUTLOOK

Moberg Pharma's goal is to create value and provide attractive shareholder returns through the successful commercialization of its pipeline assets.

In the near term, the focus is on the registration process for MOB‐015 in Europe, where a registration application was submitted to the Medical Products Agency in Sweden in March 2022. The company's goal is to receive its first market approval and launch MOB‐015 in 2023. Moberg Pharma also conducts a new North American Phase 3 study, where patient enrollment is ongoing. In parallel with the registration preparations, commercialization preparations are underway to maximize value and create future growth.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

Jan‐Mar Jan‐Mar Jan‐Dec
(TSEK) 2022 2021 2021
Continuing operations
Net revenue
Cost of goods sold
Gross profit
Selling expenses ‐125 ‐70
Business development and administrative expenses ‐4,899 ‐5,688 ‐18,438
Research and development costs ‐585 ‐1,207 ‐3,449
Other operating income 188 827 2,227
Other operating expenses
Operating profit (EBIT) ‐5,421 ‐6,068 ‐19,730
Interest income and similar items
Interest expenses and similar items ‐23 ‐88 ‐240
Profit after financial items from continuing operations (EBT) ‐5,444 ‐6,156 ‐19,970
Tax on profit for the period 1,002 1,206 3,748
PROFIT FOR THE PERIOD FROM CONTINUING OPERATIONS ‐4,442 ‐4,950 ‐16,222
Discontinued operations
Profit after tax for the period from discontinued operations (see
Note 2) 23,589 23,589
PROFIT FOR THE PERIOD ‐4,442 18,639 7,367
TOTAL PROFIT FOR THE PERIOD ‐4,442 18,639 7,367
Of which total result from continuing operations ‐4,442 ‐4,950 ‐16,222
Of which total result from discontinued operations (see Note 2) 23,589 23,589
Profit for the period attributable to parent company shareholders ‐4,442 18,764 7,492
Profit attributable to non‐controlling interests ‐125 ‐125
Total profit attributable to parent company shareholders ‐4,442 18,764 7,492
Total profit attributable to non‐controlling interests ‐125 ‐125
Basic earnings per share ‐0.10 0.47 0.17
Diluted earnings per share 3 ‐0.10 0.46 0.17
Basic earnings from continuing operations per share ‐0.10 ‐0.12 ‐0.38
Diluted earnings from continuing operations per share 7 ‐0.10 ‐0.12 ‐0.38
EBITDA FROM CONTINUING OPERATIONS ‐4,776 ‐5,421 ‐17,146
Depreciation/amortization ‐645 ‐647 ‐2,584
Operating profit (EBIT) ‐5,421 ‐6,068 ‐19,730

3 In periods when the Group reports a loss, no dilution effect arises. The reason for this is that a dilution effect is only recognized when a potential conversion to ordinary shares would result in lower earnings per share.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION IN BRIEF

(TSEK) 2022‐03‐31 2021‐03‐31 2021‐12‐31
Assets
Intangible assets 349,562 300,412 327,042
Capitalized development4 349,562 300,412 327,042
Tangible non‐current assets
Right‐of‐use assets 3,874 6,456 4,519
Deferred tax asset 15,680 12,091 14,673
Total non‐current assets 369,116 318,959 346,234
Trade receivables and other receivables 9,206 10,639 2,000
Cash and cash equivalents 73,440 133,611 102,655
Total current assets 82,646 144,250 104,655
TOTAL ASSETS 451,762 463,209 450,889
Equity and liabilities
Equity attributable to parent company's shareholders 437,709 445,121 434,051
Total equity 437,709 445,121 434,051
Non‐current leasing liabilities 544 4,084 1,235
Non‐current non‐interest‐bearing liabilities 65 65 65
Total non‐current liabilities 609 4,149 1,300
Current leasing liabilities 2,709 2,656 2,696
Current non‐interest‐bearing liabilities 10,735 11,283 12,842
Total current liabilities 13,444 13,939 15,538
TOTAL EQUITY AND LIABILITIES 451,762 463,209 450,889

4 For further details, see note 3

CONSOLIDATED STATEMENT OF CASH FLOWS IN BRIEF

Jan‐Mar Jan‐Mar Jan‐Dec
(TSEK) 2022 2021 2021
Operating activities
Operating profit before financial items from continuing ‐5,421 ‐6,458 ‐19,730
operations
Operating profit before financial items from discontinued ‐390
operations
Operating profit before financial items ‐5,421 ‐6,458 ‐20,120
Financial items, received and paid ‐23 ‐88 ‐240
Taxes paid
Adjustments:
Depreciation/amortization and other adjustments 645 647 2,584
Employee share‐based adjustments to equity 5 552 276 631
Cash flow before changes in working capital ‐4,247 ‐5,623 ‐17,145
Change in working capital
Increase (‐)/Decrease (+) in operating receivables 336 ‐1,704 6,836
Increase (+)/Decrease (‐) in operating liabilities ‐2,106 ‐6,645 ‐4,987
OPERATING CASH FLOW ‐6,017 ‐13,972 ‐15,296
Investing activities
Net investments in intangible assets ‐22,520 ‐4,679 ‐31,309
Net investments in and divestment of subsidiaries ‐9,999 ‐9,999
CASH FLOW FROM INVESTING ACTIVITIES ‐22,520 ‐14,678 ‐41,308
Financing activities
Issue of loans
Repayment of leases ‐678 ‐655 ‐3,464
Issue of new shares less transaction costs 133,631 133,438
CASH FLOW FROM FINANCING ACTIVITIES ‐678 132,976 129,974
Change in cash and cash equivalents ‐29,215 104,326 73,370
Cash and cash equivalents at beginning of period 102,655 29,285 29,285
Cash and cash equivalents at the end of period 73,440 133,611 102,655

5 Note that revaluation of estimated costs for social security contributions for share‐based compensation plans is reported in change in operating liabilities.

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

(TSEK) Share capital Other capital
contributions
Accumulated
profit/loss
Non‐
controlling
interest
Total equity
1 January – 31 March 2022
Opening balance, January 1, 2022 4,405 731,376 ‐301,730 434,051
Total profit
Profit for the period ‐4,442 ‐4,442
Transactions with shareholders
New shares issued 117 7,451 7,568
Transaction costs ‐21 ‐21
Share‐based incentive program 552 552
CLOSING BALANCE, MARCH 31, 2022 4,522 739,358 ‐306,172 437,708
(TSEK) Share capital Other capital
contributions
Accumulated
profit/loss
Non‐
controlling
interest
Total equity
January 1 – December 31, 2021
Opening balance, January 1, 2021 3,814 693,278 ‐309,222 7,707 395,577
Total profit
Profit for the period 7,492 ‐125 7,367
Transactions with shareholders
Distribution OncoZenge AB ‐7,582 ‐7,582
New shares issued 682 37,620 38,302
Transaction costs ‐153 ‐153
Repurchase of own shares ‐91 ‐91
Share‐based incentive program 631 631
CLOSING BALANCE, DECEMBER 31, 2021 4,405 731,376 ‐301,730 434,051

KEY RATIOS FOR THE GROUP

Jan‐Mar Jan‐Mar Jan‐Dec
(TSEK) 2022 2021 2021
Net revenue *
EBITDA * ‐4,776 ‐5,421 ‐17,146
Operating profit (EBIT) * ‐5,421 ‐6,068 ‐19,730
Total profit ‐4,442 18,639 7,367
Cash and cash equivalents 73,440 133,611 102,655
Balance sheet total 451,762 463,209 450,889
Equity/assets ratio 97% 96% 96%
Return on equity ‐1% 4% 2%
Diluted earnings per share, SEK ‐0.10 0.47 0.17
Equity per share, SEK 9.68 10.11 9.85
Basic average number of shares 44,059,676 40,016,363 43,039,100
Diluted average number of shares 45,151,355 40,393,634 44,134,354
Number of shares at the end of the period excluding
repurchased own shares
45,216,377 44,046,679 44,046,679
Share price on balance sheet date, SEK 4.37 5.68 5.37
Market capitalization balance date, SEK million 198 250 237

*continuing operations

DEFINITIONS OF KEY RATIOS

Moberg Pharma presents certain financial performance measurements in the interim report that are not defined in accordance with IFRS. In Moberg Pharma's opinion, these performance measurements provide valuable additional information to investors and company management as they enable an evaluation of the company's performance. These financial performance measurements are not always comparable with those used by other companies, since not all companies calculate them in the same manner. Accordingly, these financial measurements are not to be regarded as a replacement for the performance measurements defined in accordance with IFRS.

EBITDA Operating profit before depreciation/amortization and impairment of intangible
assets and property, plant, and equipment
Equity/assets ratio Equity at the end of the period in relation to balance sheet total
Return on equity Profit for the period divided by closing equity
Earnings per share* Profit after tax divided by the diluted average number of shares
Equity per share Equity divided by the number of shares outstanding at the end of the period

* Defined in accordance with IFRS

PARENT COMPANY INCOME STATEMENT SUMMARY

Jan‐Mar Jan‐Mar Jan‐Dec
(TSEK) 2022 2021 2021
Net revenue
Cost of goods sold
Gross profit
Selling expenses ‐125 ‐70
Business development and administrative expenses ‐4,899 ‐5,688 ‐18,438
Research and development costs ‐585 ‐1,207 ‐3,449
Other operating income 188 1,036 2,436
Other operating expenses
Operating profit ‐5,421 ‐5,859 ‐19,521
Interest income
Interest expenses ‐23 ‐88 ‐240
Profit after financial items ‐5,444 ‐5,947 ‐19,761
Tax on profit for the period 1,002 1,161 3,703
PROFIT ‐4,442 ‐4,786 ‐16,058

PARENT COMPANY BALANCE SHEET SUMMARY

(TSEK) 2022‐03‐31 2021‐03‐31 2021‐12‐31
Assets
Intangible non‐current assets 349,562 300,412 327,042
Tangible non‐current assets
Right‐of‐use assets 3,874 6,456 4,519
Non‐current financial assets 100 100 100
Deferred tax asset 15,680 12,091 14,673
Total non‐current assets 369,216 319,059 346,334
Trade receivables and other receivables 9,206 10,540 2,000
Cash and cash equivalents 73,440 133,611 102,655
Total current assets 82,646 144,151 104,655
TOTAL ASSETS 451,862 463,210 450,989
Equity and liabilities
Equity 437,709 445,122 434,052
Non‐current leasing liabilities 544 4,084 1,235
Non‐current non‐interest‐bearing liabilities 65 65 65
Total non‐current liabilities 609 4,149 1,300
Liabilities to Group companies
99 99 99
Current leasing liabilities 2,709 2,656 2,696
Current non‐interest‐bearing liabilities 10,736 11,184 12,842
Total current liabilities 13,544 13,939 15,637
TOTAL EQUITY AND LIABILITIES 451,862 463,210 450,989

PARENT COMPANY CASH FLOW STATEMENT SUMMARY

Jan‐Mar Jan‐Mar Jan‐Dec
(TSEK) 2022 2021 2021
Operating activities
Operating profit before financial items ‐5,421 ‐5,859 ‐19,521
Financial items, received and paid ‐23 ‐88 ‐240
Adjustments:
Depreciation and other adjustments 645 647 2,584
Expenses for share‐based incentive program 552 276 631
Cash flow before changes in working capital ‐4,247 ‐5,024 ‐16,546
Change in working capital
Increase (‐)/Decrease (+) in operating receivables 336 ‐1,609 6,931
Increase (+)/Decrease (‐) in operating liabilities ‐2,106 ‐7,339 ‐5,681
OPERATING CASH FLOW ‐6,017 ‐13,972 ‐15,296
Investing activities
Net investments in intangible assets ‐22,520 ‐4,679 ‐31,309
CASH FLOW FROM INVESTING ACTIVITIES ‐22,520 ‐4,679 ‐31,309
Financing activities
Issue of loans
Repayment of leases ‐678 ‐655 ‐3,464
Issue of new shares less transaction costs 133,631 133,438
CASH FLOW FROM FINANCING ACTIVITIES ‐678 132,976 129,974
Change in cash and cash equivalents ‐29,215 114,325 83,369
Cash and cash equivalents at the beginning of the period 102,655 19,286 19,286
Cash and cash equivalents at the end of the period 73,440 133,611 102,655

NOTE 1 ACCOUNTING POLICIES AND MEASUREMENT PRINCIPLES

The interim report was prepared in accordance with IAS 34 and the Swedish Annual Accounts Act. The consolidated financial statements were, like the annual accounts for 2021, prepared in accordance with the International Financial Reporting Standards (IFRS) as adopted by the EU and the Swedish Annual Accounts Act. The parent company financial statements were prepared in accordance with Swedish Annual Accounts Act and Recommendation RFR 2 of the Swedish Financial Reporting Board, Financial Statements for Legal Entities.

Amounts are presented in Swedish kronor and rounded to the nearest thousand unless otherwise stated. Rounding to the nearest thousand may mean that certain amounts do not match when added up. Amounts and figures in parentheses refer to comparable figures for the corresponding period in 2021.

NOTE 2 DISCONTINUED OPERATIONS

The operations attributable to the BUPI project are reported as discontinued operations. The Extraordinary General Meeting on 1 December 2020 decided, in accordance with the Board's proposal, to distribute Moberg Pharma's interest in the BUPI project through shares in the subsidiary OncoZenge to Moberg Pharma's shareholders. The dividend was paid in accordance with Lex ASEA on February 4, 2021. In accordance with the decision to distribute the shares in OncoZenge AB on December 1, 2020, a liability for this distribution was recognized at a fair value of SEK 45 million. On December 31, 2020, the spun‐off intangible assets were recognized at book value, SEK 22 million. When the assets were distributed in February 2021, the asset amount was adjusted to fair value and reported as a revaluation of discontinued operations.

INCOME STATEMENT DISCONTINUED OPERATIONS

Jan‐Mar Jan‐Mar Jan‐Dec
(TSEK) 2022 2021 2021
Net revenue
Cost of goods sold
Gross profit
Selling expenses
Business development and administration expenses ‐355 ‐355
Research and development expenses ‐55 ‐55
Other operating items
Operating profit ‐410 ‐410
Finance costs
Tax benefit/(expense) 52 52
Post‐tax profit/(loss) of discontinued operations ‐358 ‐358
Revaluation of discontinued operations 23,927 23,927
Profit after tax for the period from discontinued operations 23,569 23,569
TOTAL PROFIT FOR THE PERIOD 23,569 23,569

NOTE 3 SPECIFICATION OF MAJOR INTANGIBLE NON‐CURRENT ASSETS

(TSEK) 2022‐03‐31 2021‐03‐31 2021‐12‐31
Capitalized expenditure for MOB‐015 349,562 300,412 327,042
TOTAL CAPITALIZED EXPENDITURE FOR DEVELOPMENT WORK 349,562 300,412 327,042

NOTE 4 SEGMENT REPORTING

Moberg Pharma's operations comprise only one area of operation, which is the development and commercialization of medical products. The statement of comprehensive income and statement of financial position as a whole comprises one operating segment.

NOTE 5 RELATED PARTY TRANSACTIONS

No material changes have occurred in relationships and transactions with related parties compared with information in the annual report.

INFORMATION AND FINANCIAL CALENDAR

This information is such that Moberg Pharma AB (publ) is obliged to disclose pursuant to the EU Market Abuse Regulation and the Securities Market Act.

Interim report for January–June 2022 August 9, 2022 Interim report for January –September 2022 November 8, 2022

The Annual General Meeting for Moberg Pharma will be held on May 16, 2022. Due to the coronavirus and in an effort to reduce the spread, the Board of Directors has resolved that the Annual General Meeting will be held without the physical presence of shareholders, representatives and third parties, and that the shareholders will only be able to exercise their voting rights through postal voting. Information regarding the resolutions passed by the Annual General Meeting will be published on May 16, 2022, as soon as the results of the postal voting have been finalized.

FOR FURTHER INFORMATION, PLEASE CONTACT

Anna Ljung, CEO, tel. 08‐522 307 01, [email protected] Mark Beveridge, VP Finance, tel. 076 ‐ 805 82 88, [email protected]

For more information on Moberg Pharma's business, please see the company's website, www.mobergpharma.com.

The interim report has not been reviewed by the Company's auditors.

DECLARATION

The undersigned hereby declare that the interim report provides a true and fair overview of the operations, financial position, and results of the parent company and Group, as well as a fair description of significant risks and uncertainties faced by the parent company and Group companies.

Bromma, May 10, 2022

Peter Wolpert Chairman

Fredrik Granström Board member

Nikolaj Sörensen Board member

Mattias Klintemar Board member

Anna Ljung CEO

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