MEDIVIR AB – INTERIM REPORT JANUARY – SEPTEMBER 2019

The development of Medivir's clinical portfolio is progressing according to plan

July – September
Financial summary

• Net turnover amounted to SEK 1.7 (3.0) million.
• The loss before interest, tax, depreciation and amortization (EBITDA) totaled SEK -22.0 (-66,9) million. Basic and diluted earnings per share amounted to SEK -0.95 (-2.93) SEK and SEK -0.95
  (-2.93) respectively.
• Cash flow from operating activities amounted to SEK -31.8 (-78.4) million.
• Liquid assets and short-term investments totaled SEK 158.5 (357.1) million at the period end.

January – September
Financial summary

• Net turnover amounted to SEK 7.3 (10.3) million.
• The loss before interest, tax, depreciation and amortization (EBITDA) totaled SEK -88.6 (-229.8) million. Basic and diluted earnings per share amounted to SEK -3.76 (-9.88) and SEK -3.76 (-9.88) respectively.
• Cash flow from operating activities amounted to SEK -125.3 (-248.1) million.
• Liquid assets and short-term investments totaled SEK 158.5 (357.1) million at the period end.

Significant events after the quarter

• The first patient was included in a phase I study in which the safety and tolerability of a combination of birinapant and radiotherapy are evaluated in patients with recurrent epithelial cancer in the head and neck region. The study is sponsored and funded as part of the National Cancer Institute's Cancer Treatment Evaluation Program (CTEP).
• The first milestone-payment for the candidate drug MIV-701 in veterinary medicine was received in October.
• Preclinical data showing that in addition to its direct effect on cancer cells, MIV-818 also modulates the anti-tumor immune response, presented at the AACR-NCI-EORTC conference in Boston.
• The ninth and final liver cancer patient was included in the phase Ia study with MIV-818. Based on safety and tolerability as well as pharmacokinetics and positive biomarker data, it was decided to initiate the phase Ib portion of the study.
    

Conference call for investors, analysts and the media
The Interim Report January - September 2019 will be presented by Medivir’s President & CEO, Uli Hacksell.

Time: Wednesday, November 27, 2019, at 14.00 (CET).

Phone numbers for participants from:
Sweden + 46 8 566 426 92
Europe + 44 33 3300 9035
US + 1 833 5268 347

The conference call will also be streamed via a link on the website: www.medivir.com
The presentation will be available on Medivir’s website after completion of the conference.
  

CEO’s message
The development of Medivir's clinical portfolio is progressing according to plan and during the quarter another clinical combination study with birinapant was initiated, directed by the National Cancer Institute in the USA. This means that Medivir now has four ongoing clinical trials in cancer, two in phase I and two in phase II. In our clinical portfolio, there are also two projects that have been through phase II; remetinostat for cutaneous T-cell lymphoma and MIV-711 for osteoarthritis. We are now looking forward to starting the phase Ib part of the study with MIV-818 in liver cancer, and to carry out the futility analysis of the phase II study with birinapant and Keytruda®, in the fourth quarter. In addition to having succeeded in further developing our clinical portfolio within oncology, we can also note that in the third quarter we achieved the goal we previously communicated, namely that the fixed costs of the business are now at one third of last year's level, and that with an efficient, competent and experienced organization.

Let me summarize the status of our clinical portfolio during the quarter.

MIV-818 is Medivir's proprietary nucleotide prodrug, designed to provide a targeted anti-tumor effect in the liver while minimizing any adverse side effects.

In an ongoing phase I study, the safety, tolerability and pharmacokinetics of MIV-818 are studied in patients with advanced liver cancer.

In June, we presented an analysis of data from the first six patients in the phase Ia portion of the study indicating that MIV-818 has the intended liver-directed effect. MIV-818 was well tolerated and in addition, an effect signal on liver biopsies from tumor tissue was observed in MIV-818 treated patients. Unlike the tumor, normal liver tissue does not appear to have been affected by the treatment.

The early clinical results in the phase Ia part constitute a proof-of-concept for this in-house developed project. There is a very large potential here to make a vital difference for patients lacking good treatment options. We are now looking forward to starting the phase Ib part of the MIV-818 study in the fourth quarter.

After the end of the quarter, preclinical data for MIV-818 were presented at the AACR-NCI-EORTC conference in Boston. The data show that MIV-818 has an immunomodulatory effect in vitro and increases the ability of white blood cells to kill cancer cells, especially when combined with the anti-PD1 checkpoint inhibitor pembrolizumab. These data open up the possibility of future combinations of MIV-818 with immunotherapy.

Our preclinical candidate drug MIV-828 for the treatment of blood cancer is, like MIV-818, a completely proprietary nucleotide-based prodrug. This is yet an example of Medivir's ability to develop its own high-quality candidate drugs. As with all clinical development, cost is decisive for the pace at which projects can be developed. Right now, we are focusing on MIV-818, but we hope to start the preclinical development of the promising MIV-828 soon.

Remetinostat is our topical HDAC inhibitor that is developed to treat mycosis fungoides, the most common form of cutaneous T-cell lymphoma, an unusual form of blood cancer that occurs first in the skin. Medivir has determined the design of a phase III study based on the clarifications we received from the FDA at the end of last year. We are looking for a partner for the continued development and commercialization of remetinostat.

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

Birinapant is Medivir's SMAC mimetic that is being developed in combination with Merck's anti-PD-1 treatment Keytruda® (pembrolizumab) as a treatment for patients with colorectal cancer. The efficacy of the combination therapy is evaluated in an ongoing phase II study with patients with microsatellite stable (MSS) colorectal cancer, a cancer form in which treatment with Keytruda® alone very rarely gives effect. The study evaluates preliminary efficacy as well as safety and tolerability. A futility analysis of the study will be presented in Q4 2019.

In addition, a phase I study was initiated in October by the National Cancer Institute in the United States where patients with head or neck cancer are treated with Medivir's birinapant in combination with radiation therapy. The primary objective of the study is to evaluate the safety of the combination therapy and to determine a maximum tolerated dose for further studies. Potential signs of treatment efficacy will also be studied.

We look forward to the results of this study and hope that they will provide support for birinapant's potential to be included in several types of combination treatments of a number of different cancers.
  

For MIV-711, Medivir's cathepsin K inhibitor for the treatment of osteoarthritis, we have now compiled a comprehensive data package with the data from the extension study presented in the previous quarter. Medivir continues to aim to establish a licensing or collaboration agreement for MIV-711.

In addition to the clinical development of our portfolio, we work intensively on business development for our projects. We work with a strong commitment and compassion to develop Medivir's candidate drugs in the right direction and improve therapies for patients with large unmet medical needs. By doing this, we hope to create great values for our shareholders as well as for society at large.
  

Uli Hacksell
President & CEO
  

For further information, please contact
Uli Hacksell, CEO, +46 (0) 8 5468 3100
Magnus Christensen, CFO, +46 (0)73-125 0620
  

This report has been subject to auditors’ review.

The information in this report comprises the information that Medivir is obliged to disclose under the provisions of the Swedish Securities Markets Act.

The information was submitted for publication at 11.00 CET on 27 November 2019.

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