Faron Pharmaceuticals Oy

(“Faron” or the “Company”)

First Patient Recruited in Phase II RAAA Study

First patient recruited in the Traumakine® INFORAAA trial for the prevention of Multi-Organ Failure and patient mortality after surgical repair of a Ruptured Abdominal Aortic Aneurysm (RAAA)

TURKU – FINLAND, 20 February 2017 – Faron Pharmaceuticals Ltd (“Faron”) (LON: FARN), the clinical stage biopharmaceutical company, is pleased to announce the enrolment of the first patient in the Phase II INFORAAA clinical trial of Traumakine® for the treatment of Multi-Organ Failure (MOF) and mortality prevention of surgically operated Ruptured Abdominal Aorta Aneurysm (RAAA) patients. The high mortality rate of RAAA, which accounts for 4-5 deaths per 100,000 population (Karthikesalingam et al., 2014), requires new treatments to prevent post-operative reperfusion injury leading to the death of RAAA patients, which exhibits a 30-50% mortality rate post-operatively. RAAA accounts for 13-14/100,000 hospital admissions annually (Anjum et al., 2012), and is the second indication for Traumakine targeted by Faron.

Open surgical aortic repair to treat RAAA patients is associated with a Systemic Inflammatory Response Syndrome (SIRS) affecting vital organs, especially the heart, lungs, kidneys, and intestines. The death of approximately 80% of the operated RAAA patients is caused by MOF, similar to patients with Acute Respiratory Distress Syndrome (ARDS). Traumakine (FP-1201-lyo) is currently in a European Phase III clinical trial for the treatment of ARDS, with encouraging Phase I/II data. The Directors consider that data seen to date supports the rationale for extending the use of Traumakine in similar conditions to potentially treat single, and multiple, organ failures. For example, during the Traumakine phase I/II study, there was a reduced need for haemodialysis (an indication of improved kidney function) among the ARDS patients on Traumakine.

Dr Markku Jalkanen, CEO of Faron, said: “We are delighted to start the trial with the first patient enrolled in the Phase II INFORAAA trial for the reduction of post-operative RAAA patient mortality. The main cause of death for these patients is MOF following a post-operative reperfusion injury of ischemic organs including kidneys, liver, brain and intestines. We believe that Traumakine shows significant efficacy for the recovery of operated RAAA patients. Furthermore, there is a possibility that a positive outcome of both the INFORAAA and INTEREST trials could result in the INFORAAA trial fulfilling Phase III trial requirements. The clinical data of RAAA patients treated with FP-1201-lyo during the INFORAAA trial could also provide us with valuable information on the recovery of ischemic single organ injuries and planning further trials to treat these injuries.”

The Phase II INFORAAA trial (EudraCT 014-000899-025) evaluates the efficacy and safety of FP-1201-lyo compared to placebo for the prevention of MOF following open surgery for RAAA. The trial is a double-blind, randomised (2:1), parallel group study and the same dosing is used as in the on-going INTEREST Phase III trial for the treatment of ARDS patients, who also experience MOF. Both FP-1201-lyo and placebo are administered intravenously once a day for six consecutive days post-operation in addition to intensive care. The primary end point of the INFORAAA trial is to evaluate mortality after 30 days of the first dose administration and the trial also has several secondary and explorative end points, which are related to the nature of these patients. The trial is initiated with 8 sites in Finland and is planned to be expanded to Baltic States and UK.

About Ruptured Abdominal Aortic Aneurysm (RAAA)

Ruptured Abdominal Aortic Aneurysm (RAAA) is a surgical emergency with an overall mortality of 70 to 80%. It requires immediate surgery and aortic repair. Approximately half of the deaths of RAAA patients is due to not reaching the hospital in time, and despite immediate surgery and intensive care treatment, the second half dies in hospital within 30 days post-operatively, mostly due to multi-organ failure. The cause of high post-operative mortality is mainly due to prolonged hypotension/hypoxia from the ruptured aorta and the aftermath of restoring blood flow: reperfusion, vascular leakage and failure of vital organs. Currently there are an estimated 20,000 US and European patients per annum eligible for treatment.

Cited references:

Karthikesalingam A, Holt PJ, Vidal-Diez A, Ozdemir BA, PoloNiecki JD, Hinchliffe RJ and Thompson MM (2014) Mortality from ruptured abdominal aortic aneurysms: Clinical lessons from a comparison of outcomes in England and the USA. Lancet 383: 963-69.

Anjum A, Allmen von R, Greenhalgh R and Powell JT (2012) Explaining the decrease in mortality from abdominal aortic aneurysm rupture. British J. Surgery 99: 637-45.

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

For more information please contact:

Hume Brophy, PR (UK)

Conor Griffin, Alexia Faure, Alex Protsenko

Phone: +44 207 862 6381

E-mail: faron@humebrophy.com 

Consilium Strategic Communications

Mary-Jane Elliott, Chris Welsh, Lindsey Neville

Tel: +44 (0)20 3709 5700

E-mail: faron@consilium-comms.com

Westwicke Partners, IR (US)

Chris Brinzey

Phone: 01 339 970 2843

E-Mail: chris.brinzey@westwicke.com

Cairn Financial Advisers LLP, Nominated Adviser

Emma Earl, Tony Rawlinson, Rebecca Anderson

Phone: +44 207 213 0880

Panmure Gordon (UK) Limited, Joint Broker

Freddy Crossley, Duncan Monteith (Corporate Finance)

Tom Salvesen (Corporate Broking)

Phone: +44 207 886 2500

Whitman Howard Limited, Nominated Broker (UK)

Ranald McGregor-Smith, Francis North

Phone: +44 207 659 1234

About Faron Pharmaceuticals Ltd

Faron is a clinical stage biopharmaceutical company developing novel treatments for medical conditions with significant unmet needs. The Company currently has a pipeline focusing on acute organ traumas, cancer immunotherapy and vascular damage. The pipeline is built on Faron’s scientific knowledge and control of the endothelial barrier, the membrane of cells lining blood and lymphatic vessels to separate blood content from tissues. The Company’s lead candidate Traumakine is in development for the treatment of Acute Respiratory Distress Syndrome (“ARDS”), a rare, severe, life-threatening medical condition characterised by widespread inflammation in the lungs. Traumakine is currently in pan-European (INTEREST) and Japanese pivotal Phase III studies, and is commencing a European Phase II trial for the Rupture of Abdominal Aorta Aneurysm (“RAAA”). Additionally, Faron is developing Clevegen® a ground breaking pre-clinical anti-Clever-1 antibody. Clevegen has the ability to convert the immune environment around a tumour from being immune suppressive to immune stimulating. This novel macrophage-directed immuno-oncology approach is called Tumour Immunity Enabling Technology (“TIET”) and can be used alone or in combination with other immune checkpoint molecules for the treatment of cancer patients. New application opportunities related to TIET cover chronic infections and inefficient vaccination. Based in Turku, Finland, Faron Pharmaceuticals is listed on AIM under the ticker ‘FARN’. Further information is available at www.faronpharmaceuticals.com

Faron Pharmaceuticals Oy

(“Faron” or the “Company”)

Faron update for 2017

TURKU – FINLAND, 09 February 2017 – Faron Pharmaceuticals Ltd (“Faron”) (LON: FARN), the clinical stage biopharmaceutical company, is pleased to provide the following update for the year ahead, 2017. The Company’s full year 2016 audited financial results will be announced on 29 March 2017.

Targeted pipeline progress for 2017:

Traumakine®:

·      The Company expects to obtain the read-out for the pan-European phase III trial (INTEREST) results (all-cause mortality at day 28) during H2 2017.

·      The Company has recently received the third recommendation from the trial IDMC (Independent Data Monitoring Committee) to continue the study without any modifications.

·      The Company has established a manufacturing plan to build its stocks of Traumakine®. Subject to a positive outcome of the INTEREST study, having manufacturing in place should facilitate the application process for market approval of Traumakine®.

·      The Company plans to commence a Phase II US safety study (INTRUST) with Traumakine® in H2 2017. It is expected that the full study will take 12 months to complete. Timing remains subject to regulatory approvals with a pre-IND FDA meeting targeted to occur in Q3 2017.

·      The Company currently expects the Japanese Phase III pivotal study recruitment for the treatment of ARDS with Traumakine®, run by its Japanese licensing partner Maruishi Pharmaceutical Co., to progress towards completion during 2017.

·      The first recruited patient for the Company’s Traumakine® clinical study (INFORAAA) for the treatment of patients with rupture of acute abdominal aorta (RAAA) is expected in Q1 2017. The Company expects to get interim results from this 160-patient trial in 12 to 18 months. The aim of this trial is to reduce mortality in operated RAAA patients, which normally varies from 30 to 50% of all patients surgically operated on. The INFORAAA study will also assist in the design of Traumakine® trials for single organ failures.

Clevegen®:

·      The Company expects to file the first clinical trial application (CTA) with the UK regulatory authorities (MHRA) in late 2017 / early 2018.

·      The first, and primarily safety focused, trial is to be conducted with liver cancer patients at the Birmingham University Liver Cancer Centre and is expected to continue into a Phase II study via an adapted trial design for hepatocellular carcinomas (HCC) patients to recognise early efficacy signals.

·      The high yield Clevegen® production clones prepared by Selexis for Faron have demonstrated 5+ g/l production levels without optimisation of the bioreactor conditions. Faron expects that its manufacturing partner Abzena will provide purified drug substance for the Clevegen® pre- and clinical studies during Q2 2017.

Financials:

·      Faron will provide full year results on 29 March 2017.

·      At the end of 2016, Faron had approximately €11.5 million in cash.

Business development:

·      Whilst Faron is focusing on the completion of the INTEREST study and planned CTA filing for Clevegen®, the Company continues to explore potential business opportunities for both assets in order to consider how best to produce maximum value for its shareholders.

Additional corporate matters:

·      Due to the retirement of the Company’s Chief Medical Officer, Dr Ilse Piippo MD, the Company’s Medical Director Dr Matti Karvonen MD has taken the position from 1 February 2017. Dr Ilse Piippo will continue to support the Company as a Regulatory Consultant and will support the Company in setting up a planned paediatric Traumakine® study programme. The plan for this programme will be required for European marketing authorisation of Traumakine® and should also provide a two (2) year extension for Traumakine’s® orphan status in Europe (to a total of 12 years post approval).

·      The recently hired Director for Research, Dr Jami Mandelin, will join the Management Team and will be responsible for pre-clinical drug development and research collaborations with Faron’s scientific network.

Dr Markku Jalkanen, CEO of Faron, said: “We are very excited about Faron’s prospects for 2017 and beyond. We are getting close to read-out of the INTEREST trial, which we believe could revolutionise intensive care practices for ARDS patients. We are therefore continuing to prepare the business in anticipation of commercial launch soon after the trial results are received. In addition, the Company continues to progress and expand its clinical development programme in order to increase indications targeted and maximise shareholder value. The Company has made new hires and I would also like to take the opportunity to thank Dr Ilse Piippo for working with us since 2007 and building the current regulatory pathway for Traumakine®. The skills and commitment she has shown over the years are still evident as she builds the road for treatment with Traumakine® in paediatric applications. As a replacement, Dr Matti Karvonen has already demonstrated his strengths in the past eight months and I am confident that the Faron pipeline will progress well under his supervision.”

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

For more information please contact:

Hume Brophy, PR (UK)

Conor Griffin, Alexia Faure, Alex Protsenko

Phone: +44 207 862 6381

E-mail: faron@humebrophy.com 

Westwicke Partners, IR (US)

Chris Brinzey

Phone: +1 339 970 2843

E-Mail: chris.brinzey@westwicke.com

Cairn Financial Advisers LLP, Nominated Adviser

Emma Earl, Tony Rawlinson, Rebecca Anderson

Phone: +44 207 213 0880

Panmure Gordon (UK) Limited, Joint Broker

Freddy Crossley, Duncan Monteith (Corporate Finance)

Tom Salvesen (Corporate Broking)

Phone: +44 207 886 2500

Whitman Howard Limited, Broker

Ranald McGregor-Smith, Francis North

Phone: +44 207 659 1234

About Faron Pharmaceuticals Ltd

Faron is a clinical stage biopharmaceutical company developing novel treatments for medical conditions with significant unmet needs. The Company currently has a pipeline focusing on acute organ traumas, cancer immunotherapy and vascular damage. The pipeline is built on Faron’s scientific knowledge and control of the endothelial barrier, the membrane of cells lining blood and lymphatic vessels to separate blood content from tissues. The Company’s lead candidate Traumakine is in development for the treatment of Acute Respiratory Distress Syndrome (“ARDS”), a rare, severe, life-threatening medical condition characterised by widespread inflammation in the lungs. Traumakine is currently in pan-European (INTEREST) and Japanese pivotal Phase III studies, and is commencing a European Phase II trial for the Rupture of Abdominal Aorta Aneurysm (“RAAA”). Additionally, Faron is developing Clevegen® a ground breaking pre-clinical anti-Clever-1 antibody. Clevegen has the ability to convert the immune environment around a tumour from being immune suppressive to immune stimulating. This novel macrophage-directed immuno-oncology approach is called Tumour Immunity Enabling Technology (“TIET”) and can be used alone or in combination with other immune checkpoint molecules for the treatment of cancer patients. New application opportunities related to TIET cover chronic infections and inefficient vaccination. Based in Turku, Finland, Faron Pharmaceuticals is listed on AIM under the ticker ‘FARN’. Further information is available at www.faronpharmaceuticals.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”, ”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 discussed in the forward looking statements including 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, reliance on key personnel, uninsured and underinsured losses and other factors, many of which are beyond the control of the Company. 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.