Appili Therapeutics Inc. (TSX:APLI; OTCQX: APLIF) (the “Company” or “Appili”), a biopharmaceutical company developing anti-infective drug candidates, today announced its financial and operational results for the second quarter of its fiscal year 2022, which ended on September 30, 2021.

“Although the top-line results of our Phase 3 PRESECO trial were not what we had hoped for, I am incredibly proud of all that our team accomplished this quarter which continues to demonstrate Appili’s ability to rapidly execute and achieve key development milestones,” said Armand Balboni, M.D., Ph.D., Chief Executive Officer of Appili Therapeutics. “I am excited to deploy our expanded drug development infrastructure to tackle the many other infectious disease threats in front of us and advance our broader anti-infective pipeline including our novel, clinical-stage antifungal ATI-2307 slated to enter Phase 2 next year, and our first-in-class biodefense vaccine candidate ATI-1701.”

Second quarter and recent operational highlights include:

• In September, announcing last patient enrolled in the Phase 3 PRESECO clinical trial evaluating Avigan®/Reeqonus™ for mild-to-moderate COVID-19 and its viral shedding sub-study, and subsequently reporting top-line results for the study.
• Announcing a closing of public offering of $7,000,220 and entering into an agreement with the Lind Partners for $3.5 million in funding to further strengthen the Company’s momentum as a fully integrated, infectious disease specialized company.
• Entering into a data transfer agreement with FUJIFILM Toyama Chemical Co., Ltd., that will provide funding support of $1,000,000 USD for the Phase 3 PRESECO trial.
• Entering into a strategic alliance and equity transaction with existing consortium partner AiPharma to enhance complementary skills and create global reach with expanded resources.
• Preparing for ATI-2307 clinical trial drug product GMP manufacturing runs to be initiated in December 2021.

Kimberly Stephens, CPA, CA, who has been the Company’s Chief Financial Officer since 2016, has chosen to leave Appili for personal reasons effective November 16, 2021. Kenneth G. Howling, who has over 25 years of experience in senior financial positions across several healthcare and pharmaceutical companies, will be joining Appili Therapeutics as Acting Chief Financial Officer this fall.

“On behalf of our entire team, I would like to thank Kimberly for her commitment and contribution to Appili Therapeutics,” continued Armand Balboni, CEO of Appili Therapeutics. “Since joining Appili in 2016, Kimberly has been an integral part of our executive team leading Appili through many of our biggest milestones, including taking the company public and up-listing to the Toronto Stock Exchange. We wish her well in her future endeavors.”

Financial Results

The Company prepares its financial statements in accordance with IFRS as issued by the International Accounting Standard Board and Part I of Chartered Professional Accountants of Canada Handbook–Accounting. All figures are stated in Canadian dollars unless otherwise stated.

The net loss and comprehensive loss of $18.5 million or $0.30 loss per share for the six months ended September 30, 2021 was $13.5 million higher than the net loss and comprehensive loss of $5.1 million or $0.09 loss per share during the six months ended September 30, 2020. This relates mainly to an increase in research and development expenses by $13.4 million, an increase in business development of $0.2 million and an increase in accreted interest of $0.2 million. These increases were offset by a decrease in general and administration expenses by $0.2 million increase of government assistance of $0.3 million.

As of September 30, 2021, the Company had cash and short-term investments of $10.0 million, compared to $16.1 million on March 31, 2021. As of November 12, 2021, the Company had 71,266,120 issued and outstanding Common Shares, 6,621,489 stock options, and 21,343,530 warrants outstanding.

This press release should be read in conjunction with the Company’s unaudited interim condensed financial statements for the second quarter of the 2022 fiscal year and the related management discussion and analysis (MD&A), copies of which are available on SEDAR at www.sedar.com.

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About Appili Therapeutics

Appili Therapeutics is an infectious disease biopharmaceutical company that is purposefully built, portfolio-driven, and people-focused to fulfill its mission of solving life-threatening infections. By systematically identifying urgent infections with unmet needs, Appili’s goal is to strategically develop a pipeline of novel therapies to prevent deaths and improve lives. As part of a global consortium, Appili recently sponsored a late-stage clinical trial evaluating the antiviral Avigan/Reeqonus for the treatment of COVID-19. The Company is also advancing a diverse range of anti-infectives, including a broad-spectrum antifungal, a vaccine candidate to eliminate a serious biological weapon threat, and two novel antibiotic programs. Led by a proven management team, Appili is at the epicenter of the global fight against infection. For more information, visit www.AppiliTherapeutics.com.

Forward looking statements

This news release contains “forward-looking statements”, including with respect to the proposed use of proceeds. Wherever possible, words such as “may,” “would,” “could,” “should,” “will,” “anticipate,” “believe,” “plan,” “expect,” “intend,” “estimate,” “potential for” and similar expressions have been used to identify these forward-looking statements. These forward-looking statements reflect the current expectations of the Company’s management for future growth, results of operations, performance and business prospects and opportunities and involve significant known and unknown risks, uncertainties and assumptions, including, without limitation, the risk that the Company may not be able to continue as a going concern and those risks listed in the annual information form of the Company dated June 23, 2021 and the other filings made by the Company with the Canadian securities regulatory authorities (which may be viewed at www.sedar.com). Should one or more of these risks or uncertainties materialize or should assumptions underlying the forward-looking statements prove incorrect, actual results, performance or achievements may vary materially from those expressed or implied by the forward-looking statements contained in this news release. These factors should be considered carefully, and prospective investors should not place undue reliance on the forward-looking statements. The Company disclaims any intention or obligation to revise forward-looking statements whether as a result of new information, future developments or otherwise, except as required by law.

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