Medivir : Interim Report January-June 2021.pdf

MEDIVIR AB - INTERIM REPORT

JANUARY - JUNE 2021

Positive study results for MIV-818 and remetinostat. Design determined for the combination study with MIV-818

April - June

Financial summary for the quarter

• Net turnover amounted to SEK 0.9 (4.0) million.
• The loss before interest, tax, depreciation and amortization (EBITDA) amounted to SEK -17.1(-12.4) million. Basic and diluted earnings per share amounted to SEK -0.35(-0.52) and SEK -0.35(-0.52) respectively.
• Cash flow from operating activities amounted to SEK -21.9(-23.3) million.
• Liquid assets and short-term investments at the end of the period amounted to SEK 247.8 (94.9) million.

January - June

Financial summary for the period

• Net turnover amounted to SEK 10.8 (11.4) million.
• The loss before interest, tax, depreciation and amortization (EBITDA) amounted to SEK -24.3(-33.1) million. Basic and diluted earnings per share amounted to SEK -0.57(-1.49) and SEK -0.57(-1.49) respectively.
• Cash flow from operating activities amounted to SEK -23.3(-40.0) million.
• Liquid assets and short-term investments at the end of the period amounted to SEK 247.8 (94.9) million.

Significant events during the quarter

• On April 16, it was announced that Magnus Christensen had been appointed interim CEO of Medivir. He took up his new role in connection with Medivir's AGM on May 5, 2021.
• On April 19, it was announced that the overall results from the first part of the phase Ib study with MIV-818 were positive with a good safety and tolerability profile. Thus, the starting dose for the second part of the phase Ib study could be determined.
• In May, positive results from an investigator-initiated phase II clinical study of remetinostat in patients with squamous cell carcinoma (SCC) were released on clinicaltrials.gov.
• In May, the design for the upcoming phase 1b/2a combination study with the company's leading candidate drug, MIV-818 against liver cancer, was presented. In the study, MIV-818 will be administered in two combinations, with either lenvatinib, a tyrosine kinase inhibitor, or pembrolizumab, an anti-PD-1 checkpoint inhibitor.

Significant events after the end of the period

• In July, Malene Jensen was appointed Vice President Clinical Development. She will assume her role on September 6, 2021.
• In August, it was announced that data from the MIV- 818 phase 1b study will be presented at the ESMO Congress in September.
• In August, the positive results from the phase II study with remetinostat against basal cell carcinoma were published in the scientific journal Clinical Cancer Research.
• In August, it was announced that Medivir, through a renegotiated multi-party agreement, strengthens the business development potential for remetinostat.

Medivir in brief

Medivir develops innovative drugs with a focus on cancer where the unmet medical needs are high. The drug candidates are directed toward indication areas where available therapies are limited or missing and there are great opportunities to offer significant improvements to patients. Medivir is focusing on the development of MIV-818,a pro-drugdesigned to selectively treat liver cancer cells and to minimize side effects.

Collaborations and partnerships are important parts of Medivir's business model, and the drug development is conducted either by Medivir or in partnership. Birinapant, a SMAC mimetic, is exclusively outlicensed to IGM Biosciences (Nasdaq: IGMS) to be developed in combination with IGM-antibodiesfor the treatment of solid tumors. Medivir's share (ticker: MVIR) is listed on Nasdaq Stockholm's Small Cap list. www.medivir.com

Medivir AB (publ), 556238-4361. PO Box 1086, SE-141 22 Huddinge, Sweden. Telephone [phone].
[e-mail] | www.medivir.com	1

CEO's message

The clinical development of MIV-818 remains in focus. Positive topline results in the phase 1b monotherapy study. The design determined for the phase 1b/2a combination study in the clinical MIV-818 program.

Medivir's central task is to advance the clinical program for our leading candidate drug MIV-818, which has the potential to be a liver-directed, orally administered drug that can help patients with various cancers of the liver. This work has also characterized our operations also in the past quarter.

In April we were able to announce that the results from the first part of the phase 1b study with MIV-818 were positive with a good safety and tolerability profile. Thereby, we were also able to determine the starting dose for the second part of the study, where we combine MIV-818 with standard treatment. Data from the first part of the phase 1b study will be presented at the ESMO scientific conference in September.

Due to its unique mechanism of action, MIV-818 is attractive to combine with a multitude of other drugs for the treatment of hepatocellular carcinoma (HCC). We have been working on refining the design for the next step in the clinical program, the upcoming phase 1b/2a combination study with MIV-818, and at the end of May we presented how the study is structured. MIV-818 will be administered in two combinations, either with lenvatinib, a tyrosine kinase inhibitor, or with pembrolizumab, an anti-PD-1 checkpoint inhibitor.

The study is an open-label,multi-center phase 1b/2a study that begins with a dose escalation part to determine the recommended phase 2 dose (RP2D). This is followed by the expansion study (phase 2a) with an initial evaluation of the safety and efficacy of the combinations of MIV-818 with lenvatinib or pembrolizumab. The study will include patients with HCC who have progressed on, or are intolerant of, first line standard therapy.

We plan to recruit the first patient for the combination study in the second half of 2021. However, we cannot guarantee that the Covid-19 pandemic will not affect our schedule.

MIV-818 is proprietary and wholly owned by Medivir, i.e. we do not have to pay any future milestones or royalties to any third party.

We have two more drug development projects in the clinical development phase, remetinostat, and MIV-711. Medivir does not conduct clinical development of these projects on its own, but instead seeks partners for further development.

During the quarter, positive results were published from an investigator-initiated clinical phase II study of remetinostat in patients with squamous cell carcinoma (SCC). The study was conducted at the Stanford

University School of Medicine in California, USA. The primary objective of the study was to assess the effects of topical remetinostat on biopsy-proven SCC and SCC in situ tumors. In August, the positive results from the phase II study with remetinostat in patients with BCC were also published in the scientific journal Clinical Cancer Research.

The results are very promising and provide further support for the potential of remetinostat as a treatment for a number of skin-associated cancers in addition to cutaneous T-cell lymphoma (CTCL). Medivir renegotiated in August a multi-party agreement with the originators of remetinostat and TetraLogic Pharmaceuticals Corporation and The Leukemia & Lymphoma Society regarding the financial obligations for remetinostat in order to create better conditions for business development.

Medivir's birinapant project, for the treatment of solid tumors, was outlicensed to the American company IGM Biosciences at the beginning of the year. IGM has the global and exclusive rights to develop birinapant. According to IGM's Q2 report, they plan to initiate clinical trials with birinapant in combination with their proprietary antibody IGM-8444 during 2021.

At Medivir's AGM on May 5, former CEO Yilmaz Mahshid was elected new board member and Uli Hacksell was elected chairman of the board. This guarantees continued scientific vitality and business acumen in the Board's work.

In July, Malene Jensen was recruited as Vice President Clinical Development and a member of the company's management team. With extensive experience in clinical development, Malene will focus on the clinical studies with MIV-818.

I am really impressed by the determination and dedication shared by all Medivir employees. The goal is to develop an effective drug against liver cancer through MIV-818. Given that this work continues to show good results, it could make a big difference for patients and for healthcare and thus also for the company's shareholders.

Magnus Christensen

Interim CEO and CFO

Medivir Interim Report, January - June 2021

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Proprietary project

Project	Disease area			Preclinical
	Research	development	Phase I	Phase II
MIV-818	Liver cancer
Ongoing study

PROPRIETARY PROJECT

MIV-818- for the treatment of liver cancer.

MIV-818 is our proprietary prodrug for the treatment of liver cancer. Cancer originating from liver cells (hepatocellular carcinoma, HCC) is the third most common cause of cancer-related deaths in the world. Although existing treatments for HCC can extend patients' lives, treatment benefits are often marginal and mortality remains at a high level.

During the spring 2020, MIV-818 received orphan drug designation both in the USA and in Europe, for the treatment of HCC.

MIV-818 has been developed to achieve a targeted anti-tumor effect with the maximum concentration of the active substance in the liver, while keeping the concentration in the rest of the body low to minimize potential side effects.

In March 2020, data were presented from the phase 1a study with MIV-818 providing experimental support for its liver targeted effect. Only low levels of MIV-818 and acceptable levels of troxacitabine were measured outside the liver in all nine patients.

The adverse events were dose-dependent and mainly mild, and the few serious side effects observed were reversible.

Biomarker analysis of liver biopsies from patients showed a selective effect of the treatment with MIV-

1. while tumor tissue had clear DNA damage, healthy liver tissue showed only minimal or no DNA damage. Based on an independent analysis of the liver tumors, five of the nine patients were assessed to have stable liver disease after treatment.

At the end of March this year, the last patient with advanced liver cancer was included in the first part of the phase 1b study with MIV-818 and on April 19 it was announced that the last patient had undergone the safety follow-up. The results were positive with a good safety and tolerability profile. Thus, the starting dose could be determined for the second part of the phase

1b study, where MIV-818 will be given in combination with other treatments.

Next step in the clinical program is the upcoming phase 1b/2a combination study with MIV-818.MIV-818 will be administered in two combinations, either with lenvatinib, a tyrosine kinase inhibitor or pembrolizumab, an anti-PD-1check-point inhibitor.

The study is an open-label,multi-center phase 1b/2a study starting with a dose escalation part to establish the recommended phase 2 dose (RP2D). This is followed by the expansion study (phase 2a) with an initial evaluation of the safety and efficacy of the combinations of MIV-818 with lenvatinib or pembrolizumab. The study will include patients with HCC who have progressed on, or are intolerant of, first line standard therapy.

The study is planned with two parallel dose-escalation streams. Once the RP2D has been established for the combinations, further cohorts of up to 30 patients with HCC will be enrolled in the phase 2a part of the study. An agreement with a clinical trial CRO is in place and the study is planned to be conducted in sites in Europe and Asia. The first patient is expected to be enrolled in the second half of 2021.

Project descriptions

Full descriptions of all Medivir's development projects, including their current status and ongoing studies, can be

found on the Medivir website:http://www.medivir.com/our-projects.

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Projects for partnering

Clinical phases

Project

Disease area

Preclinical

Phase I

Phase II

Phase III

Remetinostat

HDAC inhibitor (topical)

MIV-711

Ca thepsin K inhibitor (oral)

Cutaneous T-cell lymphoma (MF)

Basal cell carcinoma*

Osteoarthritis

• Conducted by Stanford University, USA Investigator sponsored study

PROJECTS FOR PARTNERING

Medivir has two projects for licensing/partnerships: Remetinostat - for improved treatment of Mycosis fungoides, the most common type of cutaneous T-celllymphoma

MIV-711- with the potential to be the first disease- modifying drug in osteoarthritis.

Currently Medivir does not conduct any clinical development for these projects, but instead evaluates the possibilities of concluding a license or collaboration agreement for the continued development of each project.

REMETINOSTAT INVESTIGATOR-INITIATED STUDIES

In Medivir's collaborations with academic research, two investigator-initiated phase II studies has been conducted at Stanford University in the USA.

In an investigator-initiated study in collaboration with researchers at Stanford University, remetinostat was given to patients with basal cell cancer (BCC). The results indicate that remetinostat has potential as an effective and well-tolerated treatment of local skin tumors in BCC patients.

At Stanford University, an investigator-initiated phase II clinical trial was also conducted in which remetinostat was given to patients with squamous cell carcinoma. The primary objective of the study was to assess the effects of topical remetinostat on biopsy-proven SCC and SCC in situ tumors.

Both the BCC and SCC studies showed positive results. The results of the BCC study were recently published in Clinical Cancer Research and the publication of the final results of the SCC study is being prepared.

Medivir has full access to, and the right to use, all clinical data from both studies.

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Outlicensed projects

				Preclinical
Project	Disease area	Partner		development	Phase I	Phase II	Phase III	Market
Xerclear	Labial herpes	GSK
Birinapant	Solid tumors	IGM Biosciences
SMAC mimetic (intravenous)

Head & Neck cancer (with radiation)*

Ongoing study

* Investigator sponsored study conducted by NCI, USA

OUTLICENSED PROJECTS

Xerclear® - In 2009, Xerclear® (Zoviduo®) was approved for the treatment of labial herpes. The marketing rights to Xerclear® in the USA, Canada and Mexico were divested in 2010, while the corresponding rights in Europe and the rest of the world have been out- licensed to GlaxoSmithKline, with the exception of China, where Medivir has out-licensed the rights to Shijiazhuang Yuanmai Biotechnology Co Ltd. (SYB), and Israel and South America where Medivir has retained the rights.

Medivir receives royalties on Xerclear®/(Zoviduo®) sales from GlaxoSmithKline. In addition, Medivir would receive milestones when Zoviduo® is approved as an over the counter product in new markets.

After marketing approval and production in China, Medivir will receive a fixed royalty from SYB for each unit sold and the agreement guarantees a minimum sale during the first three years on the market amounting to single-digit million SEK.

Birinapant - for the treatment of solid tumors. In January 2021, Medivir entered into a licensing agreement with IGM regarding the global and exclusive rights to develop birinapant. IGM plans to initially study birinapant in combination with its antibody, IGM-8444,against Death Receptor 5, which is in clinical development.

Medivir received a payment of USD 1 million after signing the agreement, which is to be followed by an additional USD 1.5 million when IGM includes birinapant in phase I clinical trials. In addition, the agreement entitles Medivir to milestone payments up to a total of approximately USD 350 million, given that birinapant is successfully developed and approved, as well as tiered royalties up to mid-teens on net sales. A portion of all revenue is shared with Tetralogic, but the main part remains with Medivir.

At the National Cancer Institute (NCI) in the USA, an ongoing investigator-initiated phase I study evaluates the safety and tolerability of birinapant combined with radiotherapy in patients with recurrent squamous cell carcinoma in the head and neck region.

MIV-701

In the spring of 2019, a licensing agreement was signed for one of Medivir's candidate drugs, MIV-701, with the French company Vetbiolix, granting Vetbiolix the right to develop the product for veterinary use.

MIV-701 is a cathepsin K inhibitor that is not suitable for human development due to its rapid degradation, but which has excellent properties for animals. Medivir is entitled to additional milestone payments as well as royalties during the continued development.

Preclinical projects

In the first quarter of 2020 Medivir entered into a licensing agreement with the US-based biotech company Tango Therapeutics for the preclinical USP1 research programme. Tango has announced that they expect to file an IND for a USP1 inhibitor in 2022. Through the agreement, Medivir is entitled to multiple development and commercial milestone payments as well as royalties on future sales.

Furthermore, Medivir has entered into an option agreement with another biotech company for yet another preclinical research project.

In July 2020 a research collaboration was initiated with the Drug Discovery and Development Platform (DDD) at SciLifeLab on potential inhibitors of SARS CoV-2. Through the collaboration, DDD will get access to Medivir's unique proprietary protease-targeted compound library.

In february 2021 a licensing agreement with Ubiquigent was signed for the preclinical research program USP7.

The agreement grants Ubiquigent an exclusive global license to develop and commercialize all of the program's related substances in all therapeutic indications in exchange for agreed revenue sharing with Medivir upon successful development or commercialization.

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