Aptorum Group Limited Reports Financial Results and Business Update for the Six Months Ended June 30, 2019

NEW YORK--(BUSINESS WIRE)-- Aptorum Group Limited (“Aptorum Group” or the “Company”) (NASDAQ: APM), a biopharmaceutical company focused on the development of novel therapeutics to address global unmet medical needs, today provided a business update and announced financial results for the six months ended June 30, 2019.

“During the first six months of 2019, Aptorum Group achieved a number of milestones. Across our pipeline, ALS-4, the drug candidate for the treatment of infections caused by Staphylococcus aureus including methicillin-resistant Staphylococcus aureus (MRSA), has been progressing well and already entered IND-enabling studies. The first series of GLP toxicology study has been completed and we plan to target the related IND submission around the first to second calendar quarter of 2020. After which, hybrid clinical studies are being designed and are planned to take place in North America. We are also excited to announce the investigation and development of two new preclinical drug candidates, CLS-1 and SACT-1, targeting obesity and neuroblastoma under our recently announced Claves and Smart-ACT^TM platforms respectively. Under both platforms, Aptorum Group will continue to drive the discovery and development of new therapeutic candidates focused on unmet needs related to gastrointestinal microbiome and in the orphan diseases area,” said Ian Huen, Founder and Chief Executive Officer of Aptorum Group. “To promote further exciting venture opportunities, on April 24, 2019, we entered into a Master Collaboration Agreement with Singapore based A*ccelerate Technologies Pte Ltd, the enterprise office of the government research institution Agency for Science, Technology and Research (A*STAR), pursuant to which the parties may contribute up to an aggregate of $90 million cash and in-kind contributions to suitable start-ups. Through this agreement, Aptorum Group and A*ccelerate intend to jointly create a number of deep tech healthcare and life sciences based ventures in Singapore over the next five years.”

Recent Business Updates

- Aptorum Group has commenced the investigational new drug (IND)-enabling studies for ALS-4, the small drug molecule candidate indicated for the treatment of infections caused by Staphylococcus aureus including methicillin-resistant Staphylococcus aureus (MRSA, a “super-bug”) based on a novel anti-virulence approach.

- Claves Life Sciences Limited, a wholly owned subsidiary of Aptorum Group, established a novel therapeutic platform for the treatment of various diseases via modulation of the chemical signaling relating to gut microbiota. Investigation and development of a new preclinical drug candidate, CLS-1, targeting obesity have commenced with the view to commence IND enabling studies in 2020.

- Aptorum Group has established a new subsidiary, Smart Pharma, which operates its novel computational repurposed drug discovery, modeling and validation platform, i.e. the Smart-ACT^TM platform. Abbreviated for Accelerated Commercialization of Therapeutics, Smart-ACT^TM encompasses state-of-the-art technology to perform systematic screening and repurposing of approved drug molecules against thoughtfully selected therapeutic targets. Specifically, the Smart-ACT^TM platform comprises of a network of modules and processes that simulate the effectiveness of drug molecules against diseases for outcome prediction and selection. The Smart-ACT^TM platform will initially focus on the screening and repurposing of drug molecules for orphan diseases and diseases with other rare unmet medical needs. Under the Smart-ACT^TM platform, computational screening has been completed for 1,615 marketed drugs against 3 therapeutic target proteins which are related to poor prognosis of neuroblastoma. The selected candidates under the SACT-1 program, which is looking for a cure for neuroblastoma, are currently being investigated and undergoing preclinical development.

- Aptorum Group, Aeneas Capital Limited and A*ccelerate Technologies Pte Ltd, the enterprise office of the Agency for Science, Technology and Research (A*STAR), signed a contribution agreement to co-create local deep tech start-ups in the healthcare and life sciences sector. Through this agreement, Aptorum Group and A*ccelerate intend to jointly create up to 20 deep tech ventures in Singapore over the next five years. These enterprises will leverage technologies co-developed by A*STAR research institutes and Aptorum Group. The parties agreed to contribute up to an aggregate of $90 million in cash or in-kind contributions to create these ventures.

Upcoming Milestones

- For ALS-4, Aptorum Group anticipates filing an IND submission in the first or second calendar quarter of 2020 and a hybrid Phase 1 clinical study is currently planned in North America with both healthy volunteers and patients to obtain preliminary efficacy readout.

Financial Results for the Six Months Ended June 30, 2019

Aptorum Group reported a net loss of $9.6 million for the six months ended June 30, 2019 compared to $5.5 million for the same period in 2018. The increase in net loss in current period was driven by increase in research and development expenses, general and administrative fees and legal and professional fees.

Research and development expenses were $2.7 million for the six months ended June 30, 2019 compared to $1.3 million for the same period in 2018. The increase was primarily due to the incurred expenses for new sponsored research entered into with Universities in such period, and the full operation of research and development was started in the second half of 2018 which led to depreciation and increase in payroll expenses since second half of 2018.

General and administrative fees were $3.2 million for the six months ended June 30, 2019 compared to $2.2 million for the same period in 2018. The increase was mainly driven by increased headcount in the Group to support the business development, and the higher amounts of insurance expense incurred after the Company listed its securities on NASDAQ.

Legal and professional fees were $2.0 million for the six months ended June 30, 2019 compared to $1.1 million for the same period in 2018. The increase in legal and professional fees was mainly due to the increasing need for consultancy services on various projects.

As of June 30, 2019, cash and marketable securities totaled approximately $6.1 million and total equity was in excess of $24.0 million.

On August 13, 2019, Aptorum Group entered into financing arrangements allowing the Company to access up to a total $15.0 million in line of credit debt financing. As of the date of this release, the Company has not yet drawn down from this line of credit.

Aptorum Group expects that its existing cash and marketable securities, together with expected and committed cash from existing collaborations, will enable it to fund its operating and capital expenditure requirements to the end of 2020.

About Aptorum Group

Aptorum Group is a pharmaceutical company currently in the preclinical stage, dedicated to developing and commercializing therapeutic technologies to tackle unmet medical needs. The company is pursuing therapeutic projects in infectious diseases, gastroenterology, orphan diseases and other disease areas.

For more information about the Company, please visit www.aptorumgroup.com.

Forward-Looking Statements

This press release includes statements concerning Aptorum Group Limited and its future expectations, plans and prospects that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. For this purpose, any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terms such as “may,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” or “continue,” or the negative of these terms or other similar expressions. Aptorum Group has based these forward-looking statements, which include statements regarding projected timelines for application submissions and trials, largely on its current expectations and projections about future events and trends that it believes may affect its business, financial condition and results of operations. These forward-looking statements speak only as of the date of this press release and are subject to a number of risks, uncertainties and assumptions including, without limitation, risks related to its announced management and organizational changes, the continued service and availability of key personnel, its ability to expand its product assortments by offering additional products for additional consumer segments, development results, the company’s anticipated growth strategies, anticipated trends and challenges in its business, and its expectations regarding, and the stability of, its supply chain, and the risks more fully described in Aptorum Group’s Form 20-F and other filings that Aptorum Group may make with the SEC in the future. As a result, the projections included in such forward-looking statements are subject to change. Aptorum Group assumes no obligation to update any forward-looking statements contained in this press release as a result of new information, future events or otherwise.

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