Inside Information: Faron Pharmaceuticals Ltd is planning a rights offering of approximately EUR 40 million to strengthen its capital structure and to drive lead asset bexmarilimab to key milestones

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Inside Information: Faron Pharmaceuticals Ltd is planning a rights offering of approximately EUR 40 million to strengthen its capital structure and to drive lead asset bexmarilimab to key milestones

TURKU, FINLAND – Faron Pharmaceuticals Ltd. (AIM: FARN, First North: FARON, “Faron” or the “Company”) announces that it is planning a share issue with pre-emptive subscription rights for the Company’s existing shareholders to raise gross proceeds of approximately EUR 40 million (the “Offering”) The Offering is aimed to strengthen the Company’s financial position and to accelerate the development of its lead asset bexmarilimab and to run the Phase II portion of the FDA agreed Phase II/III trial in frontline HR MDS. To seek shareholders’ approval for the Offering, Faron will today publish a notice to convene an Extraordinary General Meeting of Shareholders (EGM), to be held on 2 March 2026.

Key Highlights

• The objective of the Offering is to strengthen the Company’s financial position and to finance the continued development of the Company’s lead asset bexmarilimab to the next set of key clinical milestones and expected value inflection points for 2026 and 2027.
• Faron intends to raise approximately EUR 40 million in the Offering. The net proceeds from the Offering will be used to fund the Phase II portion of the Phase II/III trial agreed with the U.S. Food and Drug Administration (FDA) testing bexmarilimab + azacitidine against placebo + azacitidine in frontline high risk myelodysplastic syndrome (HR MDS), along with several investigator‑initiated combination trials across multiple cancers.
• To align its clinical development plan with the recent FDA MDS guidelines from 2025, Faron plans to propose Complete Response (CR) as the approval endpoint, which would substantially shorten the confirmatory Phase III trial duration.
• Faron believes that its staged and cost-efficient clinical development plan adapts well to the recent evolution in the HR MDS competitive landscape, particularly the failure of certain other drug candidates due to their clinical trial design and/or safety concerns.
• Faron will host a virtual Business Update on Wednesday, 11 February 2026 at 3pm EET / 2pm CET / 8am ET. During the event, Faron’s Chief Executive Officer, Dr. Juho Jalkanen, will provide an update on the Company’s development plans and the rationale behind the planned Offering.

Background for the Offering

Faron has reached a critical stage in the advancement of bexmarilimab. In order to position the Company to achieve the next expected key value-inflection milestones, Faron’s Board of Directors has undertaken a detailed review of the development plan of bexmarilimab and forecasted funding requirements. With the proposed Offering Faron aims to fund the Phase II portion of a Phase II/III registrational trial of bexmarilimab in frontline high risk myelodysplastic syndrome (HR MDS) that was agreed with the FDA in H2 2025, along with supporting several investigator‑initiated combination trials across multiple solid tumors.

Chairman statement

“The Board has carefully considered a range of financing alternatives, including non-dilutive funding, debt instruments and equity-linked structures to fund the development of bexmarilimab. Having taken into account the Company’s development stage, market conditions and the importance of reaching a flexible balance sheet, we have concluded that equity financing by way of a rights offering is the most appropriate and prudent course of action at this time for the Company and its shareholders. We have therefore decided to convene the EGM to seek authorization from the shareholders for the Offering. The Board considers that a rights offering, offered to existing shareholders on a pre-emptive basis, represents a fair and equitable means of raising capital, allowing shareholders the opportunity to participate in the financing in proportion to their existing shareholdings and to mitigate dilution should they choose to do so. Accordingly, the Board unanimously believes that the rights offering is in the best interests of the Company and its shareholders as a whole and is necessary to support the execution of the Company’s strategy and the creation of long-term shareholder value, as this funding will enable the Company to facilitate progress toward multiple near-term clinical and regulatory milestones.

We trust that our shareholders will support the resolution to be proposed at the EGM to enable the planner rights offering to proceed,” says Tuomo Pätsi, the Chair of the Board.

Bexmarilimab’s clinical development plan aligned with FDA guidance and recent competitive landscape evolutions

Faron plans to start in the second half of 2026 the Phase II part of the randomized Phase II/III trial comparing two doses of bexmarilimab versus placebo, all in combination with standard-of-care azacitidine. At the end of the Phase II, anticipated late 2027, Faron aims to unblind the Phase II data and request an FDA meeting to select the final dose and primary endpoint for the confirmatory Phase III part. In the second half of 2025, the FDA published the first MDS guidelines for the industry. Accordingly, Faron intends to propose Complete Response (CR) as the final approval endpoint, which is expected to substantially shorten the confirmatory Phase III trial duration and cost. Of note, at the time of the frontline Phase II readout a discussion concerning accelerated approval for relapsed and refractory MDS (r/r MDS) could be re-visited with the FDA if the frontline Phase II results adequately address the FDA’s question on contribution of each agent in the efficacy of the bexmarilimab + azacitidine combination.

Faron believes that its staged and cost-efficient clinical development plan is appropriately aligned with recent changes in the HR MDS competitive landscape, particularly the failure of certain other drug candidates due to their clinical trial design and/or safety concerns.

As Faron continues to advance its frontline development plan and addressing the FDA’s remaining question on contribution of each agent testing bexmarilimab + azacitidine against placebo + azacitidine, investigators from the BEXMAB Phase I/II trial believe that the benefit of bexmarilimab in r/r MDS is clear given the data produced to date in the BEXMAB trial. Hence, led by City of Hope (USA) an investigator-initiated trial (IIT) in r/r MDS is also planned to commence in 2026 to produce more data in the last line setting while Faron pursues the frontline setting. This IIT data in r/r MDS is planned to be used for further validation of the benefit of bexmarilimab in last line HR MDS and support the discussion by Faron of potential accelerated approval in r/r MDS with the FDA at the time of the frontline Phase II read out.

Faron also plans to support up to five investigator-initiated trials to further validate bexmarilimab’s potential in combination trials in melanoma, lung cancer (NSCLC), soft tissue sarcoma, breast cancer (ER+ BRC) and leukemia (AML). The Company believes that these additional trials can further strengthen and expand the potential of bexmarilimab in solid tumors, which it expects to increase bexmarilimab’s attractiveness for a potential commercial partnership with biopharmaceutical companies on a global basis.

Dr. Juho Jalkanen, CEO and co-founder of Faron said: “We have now reached an important milestone with bexmarilimab, achieving deep and durable responses as well as favorable safety profile in HR MDS where lack of new treatments has prevailed. We remain convinced that bexmarilimab has potential to become the next standard of care in HR MDS and possible other indications, and we are confident that our clinical development plan is well designed to address the needs of patients with high unmet medical need.”

Extraordinary General Meeting

Faron intends to raise approximately EUR 40 million in equity capital, which is expected to fund the Phase II portion of the Phase II/III trial agreed with the FDA testing bexmarilimab + azacitidine against placebo + azacitidine in frontline HR MDS, along with several investigator‑initiated combination trials across multiple cancers. The remainder of the funds would support working capital needs and general corporate purposes for the Company.

The Offering is subject to an authorization by shareholders at the Extraordinary General Meeting (EGM) and a resolution by the Board of Directors of Faron Pharmaceuticals Ltd.

Faron seeks an authorization for the Offering in the EGM of Faron Pharmaceuticals Ltd, which is to be held on 2 March 2026. Preliminarily and depending on the market conditions, the subscription period for the Offering is currently expected to commence and end during the first quarter of 2026. The meeting documents will be made available at the following link: https://faron.com/investors/governance/general-meeting/

The Company may carry out an additional offering by way of a directed share issue to allocate shares to potential non-shareholder investors based on previous authorization granted by the Company’s last general meeting.

Background – bexmarilimab emerging as potential next standard of care in HR MDS

Faron’s lead asset bexmarilimab is an investigational immunotherapy designed to overcome resistance to existing cancer treatments by harnessing the power of immune cells and igniting the immune system.

The mechanism of action of bexmarilimab consists of reprogramming immune cells called macrophages, which are a key source of treatment resistance to cancer, helping tumor cells evade the immune system. This mechanism of action triggers the immune system to attack tumors and sensitizes cancer cells to chemotherapies as well as other classical cancer drugs.

Based on the strength of data already generated with bexmarilimab, Faron has been granted Orphan Drug Designation and Fast Track Designation for the treatment of the difficult-to-treat blood cancer called high-risk myelodysplastic syndrome (HR MDS) by the FDA, as well as Orphan Drug Designation by the European Medicines Agency (EMA).

The updated Phase I/II BEXMAB study data presented at the American Society of Hematology (ASH) 2025 Annual Meeting in December 2025 highlighted significant improvement in survival outcomes in patients with HR MDS treated with bexmarilimab in combination with standard-of-care azacitidine, suggesting the combination could effectively bridge to a potentially curative therapy in this otherwise deadly cancer:

• Deep and durable complete remissions (CRs), reaching 70% in most difficult to treat patients bearing a genetic mutation called TP53 mutants;
• Durable effect in patients with complete remissions, with a median of 12.1 months for all and 10.2 months for TP53 mutants and both continuing to increase as follow-up mature;
• Deep eradication of cancer cells with 67% of CR patients with no residual disease (MRD);
• Meaningful reduction of blood transfusions, with 57% of frontline patients that were transfusion dependent becoming transfusion independent; and
• Meaningful survival benefit in patients with resistant or refractory HR MDS, last line survival improvement to 14.5 months compared to 5-6 months, historically.

Sole Global Coordinator and Bookrunner
Faron has appointed Stifel Europe Securities SAS as Sole Global Coordinator and Bookrunner of the Offering.

Webcast

Faron will host a virtual Business Update on Wednesday, 11 February 2026 at 3pm EET / 2pm CET / 8am ET. During the event, Faron’s Chief Executive Officer, Dr. Juho Jalkanen, will provide an update on the Company’s development plans and the rationale behind the planned Offering.

Webcast registration link: https://faron.videosync.fi/business-update-02-2026

For more information, please contact:

About BEXMAB
The BEXMAB study is an open-label Phase I/II clinical trial investigating bexmarilimab in combination with standard of care (SoC) in the aggressive hematological malignancies of acute myeloid leukemia (AML) and myelodysplastic syndrome (MDS). The primary objective is to determine the safety and tolerability of bexmarilimab in combination with SoC (azacitidine) treatment. Directly targeting Clever-1 could limit the replication capacity of cancer cells, increase antigen presentation, ignite an immune response, and allow current treatments to be more effective. Clever-1 is highly expressed in both AML and MDS and associated with therapy resistance, limited T cell activation and poor outcomes.

About bexmarilimab
Bexmarilimab is Faron’s wholly owned, investigational immunotherapy designed to overcome resistance to existing treatments and optimize clinical outcomes, by targeting myeloid cell function and igniting the immune system. Bexmarilimab binds to Clever-1, an immunosuppressive receptor found on macrophages leading to tumor growth and metastases (i.e. helps cancer evade the immune system). By targeting the Clever-1 receptor on macrophages, bexmarilimab alters the tumor microenvironment, reprogramming macrophages from an immunosuppressive (M2) state to an immunostimulatory (M1) one, upregulating interferon production and priming the immune system to attack tumors and sensitizing cancer cells to standard of care.

About Faron Pharmaceuticals Ltd
Faron (AIM: FARN, First North: FARON) is a global, clinical-stage biopharmaceutical company, focused on tackling cancers via novel immunotherapies. Its mission is to bring the promise of immunotherapy to a broader population by uncovering novel ways to control and harness the power of the immune system. The Company’s lead asset is bexmarilimab, a novel anti-Clever-1 humanized antibody, with the potential to remove immunosuppression of cancers through reprogramming myeloid cell function. Bexmarilimab is being investigated in Phase I/II clinical trials as a potential therapy for patients with hematological cancers in combination with other standard treatments. Further information is available at www.faron.com.

Important notice
This announcement is not an offer of securities for sale into the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “Securities Act“), or under the securities laws of any state or other jurisdiction of the United States, and may not be offered, sold or transferred, directly or indirectly, in or into or from the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction of the United States. There is no intention to register the securities in the United States or to make a public offering in the United States. Any sale of the securities in the United States will be made solely to a limited number of “qualified institutional buyers” as defined in Rule 144A in reliance on an exemption from the registration requirements of the Securities Act.

The distribution of this announcement may be restricted by law and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such relevant legal restrictions. The information contained herein is not for publication, distribution or release, directly or indirectly, in or into the United States, Australia, Canada, Hong Kong, Japan, New Zealand, Singapore or the Republic of South Africa or any other jurisdiction in which the distribution, publication or release would be unlawful. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such aforementioned jurisdiction. This announcement is not directed to, and is not intended for distribution to or use by, any person or entity that is a citizen, resident or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would violate law or regulation or which would require any registration or licensing within such jurisdiction.

In any EEA Member State, other than Finland, this release is only addressed to and is only directed at “qualified investors” in that Member State within the meaning of Article 2(e) of Regulation (EU) 2017/1129 (the “Prospectus Regulation“).

In the United Kingdom, this announcement is only directed at (a) members of the Company; and (b) “qualified investors” within the meaning of paragraph 15 of Schedule 1 of the Public Offers and Admissions to Trading Regulations 2024 (the “POATR“)  who are also (i) persons having professional experience in matters relating to investments who fall within the definition of “investment professionals” in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the “Order”); (ii) persons who fall within Article 49(2)(a) to (d) of the Order; or (iii) other persons to whom it may otherwise be lawfully communicated (all such persons together being “Relevant Persons“). This announcement must not be acted on or relied on in the United Kingdom by persons who are not Relevant Persons. Persons distributing this announcement must satisfy themselves that it is lawful to do so. Any investment or investment activity to which this announcement relates is only available to Relevant Persons in the United Kingdom and will only be engaged in with such persons.

In the United Kingdom, no prospectus, offering memorandum, offering document or admission document has been or will be made available in connection with the matters contained or referred to in this announcement and no such document is required to be published (in accordance with the POATR or the AIM Rules of the London Stock Exchange). This announcement has not been approved by the Financial Conduct Authority (the “FCA“) or the London Stock Exchange.

No part of this announcement, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. The information contained in this release has not been independently verified. No representation, warranty or undertaking, expressed or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or the opinions contained herein. The Company or any of its respective affiliates, advisors or representatives or any other person, shall have no liability whatsoever (in negligence or otherwise) for any loss, however arising from any use of this release or its contents or otherwise arising in connection with this release. Each person must rely on their own examination and analysis of the Company, its subsidiaries, its securities and the transactions, including the merits and risks involved.

The Sole Global Coordinator and Bookrunner is acting exclusively for the Company and no one else in connection with the Offering. It will not regard any other person as their respective client in relation to the Offering. It will not be responsible to anyone other than the Company for providing the duties afforded to its respective clients, nor for giving advice in relation to the Offering or any transaction or arrangement referred to herein.

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 Company’s current expectations and assumptions regarding the completion and use of proceeds from the Offering, 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 Company’s current beliefs and assumptions and are based on information currently available to the Company.

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 addition, other factors which could cause actual results to differ materially include the ability of the Company to successfully licence its programmes, 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 Company believes 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, 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.