Amniotics

July - September in brief

• Total revenues: SEK 0 (0).
• Operating profit (EBITDA): SEK -15.3 (-9.8) million.
• Result for the period: SEK -16.4 (-10.2) million.
• Earnings per share: SEK -1.07 (-0.64).
• Cash flow for the quarter: SEK -5.5 (45.3) million.
• Cash and cash equivalents at the end of the reporting period: SEK 23.6 (54.2) million.
• Equity/assets ratio as per the end of the reporting period: 31 (92) %.
• Amniotics was granted patent in the U.S for PulmoStem™ that will provide Amniotics exclusive commercial rights until 2040 for PulmoStem™ for the use of the amniotic derived stem cell in the treatment of Acute Respiratory Distress Syndrome (ARDS).
• Amniotics board member Anders Månsson resigned from the board at his own request.
• Marcus Larsson, MD, Ph.D., was appointed as new Chief Executive Officer (CEO) of Amniotics

January - September in brief

• Total revenues: SEK 0 (0).
• Operating profit (EBITDA): SEK -36 (-39.1) million.
• Result for the period: SEK -38.1 (-40.4) million.
• Earnings per share: SEK -2.37 (-2.55).
• Cash flow for the quarter: SEK -20.4 (53.6) million.
• Amniotics AB has taken out a short-term loan of SEK 15 million to finance continued operations in accordance with existing business plan until the end of 2022.
• Amniotics, together with Skåne University Hospital, received a grant of SEK 4,8 million from Sweden’s Innovation Agency, Vinnova.

Other events after the end of the reporting period

• The first patient was treated with PulmoStem™ in the company’s Phase Ib clinical study evaluating the product in hospitalized patients with severe respiratory infections.
• Amendment to Phase ib study of PulmoStem approved in UK and Sweden to expand indication to severe lower respiratory tract infections caused by other viruses than SARS-CoV-2 (COVID-19).
• Natural Killer (NK) cell project patent granted in U.S for AMNI-NK003.  This patent covers methods and compositions for generating hematopoietic cells and aims to produce NK cells with strong antitumor activity.

CEO Statement
Amniotics is now a biopharma company with patients in clinical trials

Our progress with PulmoStem™ has reached a major milestone as the first patient was treated in our Phase Ib study on October 11, 2022. Having progressed the first of our product pipeline into the clinic, we have now completed the transition to a clinical stage company. I am very happy and proud of the team effort at Amniotics that made this possible. The Phase Ib trial is designed with adaptive dose escalation and has the primary objective of evaluating the safety and tolerability of PulmoStem in patients with severe lower respiratory tract infections. Secondary and explorative endpoints in the study include clinical parameters, indicators of pneumonia, regeneration and general biochemical indications. At the end of the quarter, we received approval from the authorities in Sweden and UK to broaden the patient population in the study to also include patients with severe lower respiratory tract infections caused by viruses other than COVID-19 such as influenza A, metapneumovirus and RS virus. In addition to the fact that it will now be easier and faster to recruit patients, the changes in the study protocol open up further development of PulmoStem within a wider indication area. We will use the results from the study, which are expected to be presented in the second half of 2023, to plan the continued clinical development of PulmoStem.
 
PulmoStem has provided very promising preclinical data in primary graft dysfunction (PGD), a serious complication of lung transplantation. Another potential indication for PulmoStem is idiopathic pulmonary fibrosis (IPF) where we also have promising data in preclinical animal models. In lung diseases such as IPF or PGD, the medical need for effective treatments is very high and the current treatment options are very limited. In my opinion, we have only seen the beginning of the potential for PulmoStem as a treatment for serious lung diseases.

Amniotics has recently decided to enter the field of cell therapy in oncology, more specifically the off-shelf use of NK (Natural Killer) or killer cells. NK cell therapies have been shown in several clinical studies to be effective against both hematological and solid tumours. Our Anti-cancer platform AMNI-NK003 aims to produce NK cells with high anti-tumour activity and is based on discoveries by one of our founders. The concept is based on new mechanisms to guide iPSC stem cells to become NK cells in large volumes and with high potency. NK cells are part of the immune system, and these cells scan the body to detect and eliminate cancer cells. By making large numbers of NK cells and having them ready for immediate use, they have the potential to become a widely available cell therapy for cancer treatment. We are also evaluating the possibilities of enhancing the antitumor response by adding cancer-specific receptors to the cells. The market potential for an approved oncology cell therapy is enormous and although we are still in the early stages, I am excited about the opportunities that the program can create for Amniotics going forward.

Our in-house GMP facility, where we produce our cells, is continuously upgraded. This is important to us as it will increase our manufacturing capacity. Another benefit is that such developments will strengthen our contract manufacturing capabilities and enable us to use spare capacity to generate revenue.
During the quarter, we worked on strengthening our patent protection. In August, we were granted our first US patent, which gives us exclusive commercial rights in the US until at least 2040 in the treatment of Acute Respiratory Distress Syndrome (ARDS). In October we received a patent approval in the US for our platform AMNI-NK003. Strong patent protection is a necessity for future commercial success. 

The work to strengthen our financial situation continues and we are currently evaluating various strategic alternatives to continue enabling our intensive research and development work, now as a clinical company. Due to the current market conditions Amniotics has initiated a focused strategy to reduce cost, including reducing personnel, to prolong the runway and enabling progress on selected projects.

As the new CEO since August 30, 2022, I have had the pleasure and privilege of working with the talented people who make up Amniotics. A small team that has taken a laboratory discovery and refined it into a new product that is now being evaluated in humans for the first time. Amniotics has demonstrated its ability for this transformative process, and we will use all this experience to explore other cell therapies and continue to develop PulmoStem towards the market.
 
Lund, November 2022
Marcus Larsson