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Item 1. Business

2022-02-24 compared with 2021-02-26 · 571 added, 553 removed, 288 unchanged (80% of the section changed)

Immunic, Inc.

("Immunic" or the "Company") is a clinical-stage biopharmaceutical company developing a pipeline of selective oral immunology therapies aimed at treating chronic inflammatory and autoimmune diseases, including relapsing-remitting multiple sclerosis ("RRMS"), ulcerative colitis ("UC"), Crohn’s disease ("CD") and psoriasis.

Immunic is headquartered in New York with its main operations in Gräfelfing, Germany.

Immunic currently has 28 employees.

Reverse Acquisition

On April 12, 2019, pursuant to the terms of the Agreement, dated as of January 6, 2019, between Vital Therapies, Inc., a Delaware corporation (“Vital”), Immunic AG, and the shareholders of Immunic AG party thereto, the holders of Immunic AG ordinary shares exchanged all of their outstanding shares for shares of Vital common stock, resulting in Immunic AG becoming a wholly-owned subsidiary of Vital.

Immediately following the Transaction, Vital Therapies, Inc.

changed its name to “Immunic, Inc.” and its ticker symbol to “IMUX”.

The Transaction has been accounted for as a reverse acquisition under the acquisition method of accounting.

Because Immunic AG’s pre-transaction owners held an 88.25% economic and voting interest in the combined company immediately following the closing of the Transaction, Immunic AG is considered to be the acquirer of Vital for accounting purposes.

Additionally, Immunic AG is considered to be the predecessor for reporting purposes and the financial results of Immunic AG are reported in the historical comparable periods.

Reverse Stock Split

On April 12, 2019, immediately following the closing of the Transaction, the Company effected the Reverse Stock Split.

Accordingly, all references to share and per share amounts in the accompanying audited consolidated financial statements and notes have been retroactively adjusted to reflect the Reverse Stock Split for all periods presented.

No fractional shares were issued in connection with the Reverse Stock Split.

Unless otherwise noted, all references to common stock share and per share amounts have also been adjusted to reflect the exchange ratio of 17.17.

("Immunic," “we,” “us,” “our” or the "Company") is a clinical-stage biopharmaceutical company with a pipeline of selective oral immunology therapies focused on treating chronic inflammatory and autoimmune diseases, including relapsing multiple sclerosis (“RMS”), ulcerative colitis (“UC”), Crohn’s disease (“CD”) and psoriasis.

We are headquartered in New York City with our main operations in Gräfelfing near Munich, Germany.

We currently have approximately 55 employees.

We are currently pursuing three development programs.

These include the vidofludimus calcium (IMU-838) program, which is focused on the development of oral formulations of a small molecule inhibitor of the enzyme dihydroorotate dehydrogenase (“DHODH”);

the IMU-935 program, which is focused on an inverse agonist of retinoic acid receptor-related orphan nuclear receptor gamma truncated (“RORγt”), an immune cell-specific isoform of RORγ;

and the IMU-856 program, which involves the development of a drug targeting the restoration of intestinal barrier function and regeneration of bowel epithelium.

These product candidates are being developed to address diseases such as RMS, UC, CD, and psoriasis.

In addition to these large markets, these products are also being developed to address certain rare diseases with high unmet medical needs, such as primary sclerosing cholangitis (“PSC”), as well as metastatic castration-resistant prostate cancer (“mCRPC”).

The following table summarizes the potential indications, clinical targets and clinical development status of our three product candidates:

Our most advanced drug candidate, vidofludimus calcium (IMU-838), targets DHODH, a key enzyme in the intracellular metabolism of immune cells in the body.

In the third quarter of 2020, we reported positive results from our Phase 2 EMPhASIS trial of vidofludimus calcium in relapsing-remitting multiple sclerosis (“RRMS”), achieving both primary and key secondary endpoints with high statistical significance.

The first patient in our Phase 3 ENSURE program of vidofludimus calcium in RMS, comprising twin studies evaluating efficacy, safety, and tolerability of vidofludimus calcium versus placebo, was enrolled in November 2021.

The first patient in our supportive Phase 2 CALLIPER trial of vidofludimus calcium in progressive multiple sclerosis (“PMS”) was enrolled in September 2021.

In the first quarter of 2021, we announced that vidofludimus calcium showed evidence of clinical activity in our Phase 2 CALVID-1 trial in hospitalized patients with moderate coronavirus disease 2019 ("COVID-19").

Also, in the first quarter of 2021, we reported positive top-line data from an investigator-sponsored Phase 2 proof-of-concept clinical trial of vidofludimus calcium in primary sclerosing cholangitis which was conducted in collaboration with the Mayo Clinic.

In addition, vidofludimus calcium is currently being tested in a Phase 2 trial in patients with ulcerative colitis (CALDOSE-1 trial), for which we expect top-line data to be available in June of 2022.

Additional antiviral directed development activity remains ongoing through an investigator-sponsored Phase 2 clinical trial of vidofludimus calcium as well as preclinical development examining the potential to treat a broad set of viral indications with vidofludimus calcium and other DHODH inhibitors in combination with nucleoside analogues.

If approved, we believe that vidofludimus calcium has the potential to be a highly selective first-in-class DHODH inhibitor in inflammatory bowel disease (“IBD”) and best-in-class DHODH inhibitor in RMS.

Importantly, vidofludimus calcium has an attractive pharmacokinetic, safety and tolerability profile and has already been exposed to approximately 1,100 human subjects and patients in either of the drug’s formulations.

Our second drug candidate, IMU-935, is a highly potent and selective inverse agonist of a transcription factor called RORγt.

We believe that the nuclear receptor RORγt is the main driver for the differentiation of T-helper 17 (“Th17”) cells and the release of cytokines involved in various inflammatory and autoimmune diseases.

We believe this target is an attractive alternative to approved antibodies for targets, such as interleukin-23 (“IL-23”), the IL-17 receptor and IL-17 itself.

We have observed strong cytokine inhibition targeting both Th1 and Th17 responses in preclinical testing, as well as indications of activity in animal models for psoriasis, graft versus host disease, MS and IBD.

Preclinical experiments indicated that, while leading to a potent inhibition of Th17 differentiation and cytokine secretion, IMU-935 did not affect thymocyte maturation, one of the important physiological functions that should be maintained.

Based on these preclinical data and the selectivity of the effect maintaining important physiological functions while providing the desired anti-Th17 effect, we believe that IMU-935 has potential to be a best-in-class therapy for various autoimmune diseases.

A Phase 1 clinical trial exploring safety, pharmacodynamics and pharmacokinetics of IMU-935 in healthy human subjects and psoriasis patients is currently ongoing.

Additionally, IMU-935 has been shown in preclinical models to target an established mechanism of treatment resistance to androgen receptor therapy, making it a potential treatment option for patients with resistant CRPC.

A Phase 1 clinical trial exploring safety and tolerability of increasing doses of IMU-935 to establish the maximum tolerated dose and the recommended phase 2 dose is currently ongoing in patients with mCRPC.

Our third program, IMU-856, which we believe to be novel, is an orally available small molecule modulator that targets a protein which serves as a transcriptional regulator of intestinal barrier function and regeneration of bowel epithelium.

We have not yet disclosed the molecular target for IMU-856.

Based on preclinical data, we believe this compound may represent a new treatment approach, as the mechanism of action targets the restoration of the intestinal barrier function and regeneration of bowel epithelium in patients suffering from gastrointestinal diseases such as IBD, irritable bowel syndrome with diarrhea, celiac disease and other intestinal barrier function associated diseases.

We believe that because IMU-856 has been shown in preclinical investigations to avoid suppression of immune cells, it may therefore have the potential to maintain immune surveillance for patients during therapy, an important advantage versus chronic treatment with potentially immunosuppressive medications.

A Phase 1 clinical trial exploring safety, pharmacodynamics and pharmacokinetics of IMU-856 is currently ongoing.

We expect to continue to lead most of our research and development activities from our Gräfelfing, Germany location, where dedicated scientific, regulatory, clinical and medical teams conduct their activities.

Due to these teams' key relationships with local and international service providers, we anticipate that this will result in timely, cost-effective execution of our development programs.

In addition, we are using our subsidiary in Melbourne, Australia to expedite the early clinical trials for IMU-935 and IMU-856.

We also conduct preclinical work in Halle/Saale, Germany through a collaboration with the Fraunhofer Institute.

We are focused on the development of best-in-class molecules that maximize the therapeutic benefits for patients by uniquely addressing biologically relevant immunological targets.

We take advantage of our established research and development infrastructure and operations in Germany and Australia to efficiently develop our product candidates in indications of high unmet need and where the product candidates have the potential to elevate the standard of care for the benefit of patients.

Given the mechanisms of action and the data generated to date for our product candidates, we continue to execute on the clinical development of our programs for established indications as well as explore additional indications where patients could potentially benefit from the unique profiles of each product candidate.

We are currently focused on maximizing the potential of our development programs through the following strategic initiatives:

• Executing the ongoing ENSURE and CALLIPER clinical trial programs of vidofludimus calcium in MS.

• Delivering the results from the CALDOSE-1 trial of vidofludimus calcium in UC, with the path for future development to be assessed following analysis of the results.

• Executing the ongoing clinical studies of IMU-935 in patients with psoriasis and in patients with mCRPC, with the path for future development to be assessed following analysis of the results.

• Executing the ongoing Phase 1 clinical trials of IMU-856, with potential to expand into the treatment of patients with certain gastrointestinal diseases following sufficient safety and tolerability data.

• Continued preclinical research to complement the existing clinical activities, explore additional indications for future development, and where appropriate, generate additional molecules for future development.

• Facilitating readiness for potential commercial launch of our product candidates through targeted and stage-appropriate pre-commercial activities.

• Evaluating potential strategic collaborations for each product candidate in order to complement our existing research and development capabilities and to facilitate potential commercialization of these product candidates by taking advantage of the resources and capabilities of strategic collaborators in order to enhance the potential and value of each product candidate.

Liquidity and Financial Condition

The Company’s business, operating results, financial condition and growth prospects are subject to significant risks and uncertainties, including the failure of its clinical trials to meet their endpoints, failure to obtain regulatory approval and needing additional funding to complete the development and commercialization of the Company's three development programs.

Immunic has no products approved for commercial sale and has not generated any revenue from product sales.

Immunic has never been profitable and has incurred operating losses in each year since inception (2016).

Immunic has an accumulated deficit of approximately $103.9 million as of December 31, 2020 and approximately $59.9 million as of December 31, 2019.

Substantially all of Immunic’s operating losses resulted from expenses incurred in connection with its research and development programs and from general and administrative costs associated with its operations.

Immunic expects to incur significant expenses and increasing operating losses for the foreseeable future as it initiates and continues the preclinical and clinical development of its product candidates and adds personnel necessary to advance its clinical pipeline of product candidates.

Immunic expects that its operating losses will fluctuate significantly from quarter-to-quarter and year-to-year due to timing of clinical development programs.

From inception through December 31, 2020, Immunic has raised net cash of approximately $216.8 million from private and public offerings of preferred and common stock.

As of December 31, 2020, Immunic had cash and cash equivalents of approximately $127.5 million.

With these funds, Immunic expects to be able to fund its operations beyond twelve months from the date of the issuance of the accompanying audited consolidated financial statements.

Immunic is currently pursuing three development programs, all orally available small molecule inhibitors in the clinical development phase.

These include the IMU-838 program, which is focused on the development of oral formulations of small molecule inhibitors of the enzyme dihydroorotate dehydrogenase (“DHODH”);

the IMU-935 program, which is focused on an inverse agonist of RORγt, an immune cell-specific isoform of retinoic acid receptor-related orphan nuclear receptor gamma (“RORγ”), and the IMU-856 program, which involves the development of a drug targeting the restoration of intestinal barrier function.

These product candidates are being developed to address diseases such as RRMS, UC, CD, and psoriasis.

Immunic is also investigating IMU-838 as a potential treatment option for coronavirus disease 2019 (“COVID-19”).

The following table summarizes the potential indications, clinical targets and clinical development status of Immunic’s three product candidates:

Immunic expects to continue to lead most of its research and development activities from its Gräfelfing, Germany location, where its dedicated scientific, regulatory, clinical and medical teams conduct their activities.

Due to these teams' key relationships with local and international service providers, Immunic anticipates that this will result in timely, cost-effective execution of Immunic’s development programs.

In addition, Immunic is using its subsidiary in Melbourne, Australia to expedite the early clinical trials for IMU-935 and IMU-856.

Immunic's subsidiary also conducts preclinical work in Halle/Saale, through a collaboration with the Fraunhofer Institute.

Our business, operating results, financial condition and growth prospects are subject to significant risks and uncertainties, including the failure of our clinical trials to meet their endpoints, failure to obtain regulatory approval and needing additional funding to complete the development and commercialization of our three development programs.

We have no products approved for commercial sale and have not generated any revenue from product sales.

We have never been profitable and has incurred operating losses in each year since inception (2016).

We have an accumulated deficit of approximately $196.9 million as of December 31, 2021 and approximately $103.9 million as of December 31, 2020.

Substantially all of our operating losses resulted from expenses incurred in connection with our research and development programs and from general and administrative costs associated with our operations.

We expect to continue to incur significant expenses and increasing operating losses for the foreseeable future as we continue the preclinical and clinical development of our product candidates and add personnel necessary to advance our pipeline of product candidates.

We expect that our operating losses will fluctuate significantly from quarter-to-quarter and year-to-year due to timing of clinical development programs.

From inception through December 31, 2021, we have raised net cash of approximately $259.5 million from private and public offerings of preferred and common stock.

As of December 31, 2021, we had cash and cash equivalents of approximately $86.9 million.

We are dependent on financing activities to fund ongoing operations, and due to the inherent uncertainties in successfully completing financing transactions, and with our forecasted cash reach through the first quarter of 2023, these are indicators of an inability to continue as a going concern.

However, we have the ability to manage the amount and timing of expenditures to reduce costs, have limited required fixed spend, and can manage working capital as needed and that coupled with the $16.2 million of cash raised so far in 2022 under our At The Market ("ATM") facility alleviates any uncertainty that we will have adequate liquidity to meet our obligations for at least the next 12 months from the financial statement release date.

Key Status Updates

Phase 2 Trial of IMU-838 in RRMS (EMPhASIS Trial)

On August 2, 2020, Immunic announced positive top-line data from its Phase 2 EMPhASIS trial of IMU-838 in patients with RRMS.

The trial achieved statistical significance on all primary and key secondary endpoints, indicating activity in RRMS patients.

In particular, the study met its primary endpoint, demonstrating a statistically significant reduction in the cumulative number of combined unique active ("CUA") magnetic resonance imaging ("MRI") lesions up to week 24 in patients receiving 45 mg of IMU-838 once daily, by 62% (p=0.0002), as compared to placebo.

The study also met its key secondary endpoint, showing a statistically significant reduction in the cumulative number of CUA MRI lesions for the 30 mg once daily dose by

70% (p<0.0001), as compared to placebo.

On September 11, 2020, the Company published the full unblinded clinical data set from its Phase 2 EMPhASIS trial of IMU-838 in patients with RRMS.

The data confirmed and expanded on the previously announced top-line results.

Given the relative equal performance of the two doses tested and to allow for pharmacodynamic modeling of the dose-response relationship, data from a lower dose in the effective dose range would be beneficial to complete a dose-effect assessment of IMU-838 in RRMS.

For this reason, Immunic has started an additional, small Cohort 2 sub-trial to obtain exploratory data on the expanded dose response of IMU‑838, as previously announced.

This additional, double-blind assessment includes a cohort of approximately 60 patients who receive 10 mg/day of IMU-838 or placebo for 24 weeks.

An unblinded interim analysis of selected MRI data is planned after all Cohort 2 patients have completed week 12 MRI assessments.

This additional study cohort is already fully enrolled and the Company expects the 12-week data to be available at the end of March or in early April 2021.

Immunic intends to submit formal end-of-Phase 2 meeting requests to discuss the proposed Phase 3 program with major regulatory authorities around the end of the first quarter of 2021.

The outcome of the end-of-Phase 2 meetings are expected to be available in or about May 2021.

Based on the Phase 2 results in RRMS and if approved for commercial use by regulatory agencies, Immunic believes that IMU-838 has the potential to be a best-in-class oral drug with a unique balance between robust efficacy and favorable safety profile for patients with early Multiple Sclerosis (“MS”).

The mechanism of action of IMU-838 (inhibition of the enzyme DHODH) represents a proven target for drug development, with other DHODH inhibitors (e.g., Aubagio ® , Sanofi) available commercially for the treatment of conditions such as RRMS.

Envisaged Phase 3 Program of IMU-838 in RRMS

As previously announced, in parallel to the preparation and execution of the regulatory discussions, Immunic is currently performing formal feasibility activities for a Phase 3 program of IMU-838 in RRMS, including country and site selection, as well as other preparatory activities.

For this purpose and after a comprehensive selection process, a global contract research organization ("CRO") focused on regions of particular interest and with broad experience in MS trials was formally engaged.

This will help ensure that a potential Phase 3 program can be executed efficiently following regulatory advice.

The Company also believes that this feasibility assessment will help ensure an expeditious execution of the development strategy for IMU-838.

Immunic intends to maintain a competitive selection process for a clinical CRO to conduct the potential Phase 3 program.

Immunic plans to announce details on the design of the envisaged Phase 3 program in RRMS after its end-of-Phase 2 meetings with the regulatory authorities.

The Phase 3 program is currently expected to start in the second half of 2021.

Phase 2 Trial of IMU-838 in UC (CALDOSE-1 Trial)

The trial is ongoing and enrolling patients.

Recruitment is expected to be completed in the second half of 2021 and top-line data of the induction phase is expected to be available in the first half of 2022, as previously announced.

Phase 2 Trial of IMU-838 in Moderate COVID-19 (CALVID-1 Trial)

On February 17, 2021, Immunic announced that IMU-838 has shown evidence of clinical activity in hospitalized patients with moderate COVID-19.

This planned main analysis of the Company’s Phase 2 CALVID-1 trial was based on data from 204 randomized patients and included top-line clinical efficacy, safety, disease marker, and virology data.

Although no formal statistical analysis was pre-specified for this main analysis, endpoints were analyzed descriptively.

A final analysis of the complete randomized patient population of 223, which will comprise data on all endpoints, including subgroup and sensitivity analyses, is expected to be available in the second quarter of 2021.

While primary and key secondary endpoints of the trial were not evaluable due to the very low rates of serious complications in the population of hospitalized patients with moderate COVID-19, the data did show clinical activity of IMU-838 based on multiple secondary endpoints, including clinically meaningful improvements in time to clinical recovery and time to clinical improvement.

In addition, high-risk patients and patients over 65 years of age experienced a more substantial treatment effect of IMU-838.

An anti-viral effect of IMU-838 on SARS-CoV-2 was observed by viral titers at the end of the treatment period (day 14) and at the end of the study (day 28).

A robust anti-inflammatory effect was also observed, based on a more effective reduction of C-reactive protein (“CRP”) in IMU-838 treated patients, as compared to placebo.

A more effective reduction of D-dimer, a well-known prognostic disease marker for COVID-19, was observed in IMU-838 treated patients, as compared to placebo.

Initial data from a post hoc analysis of “Long COVID” symptoms, the frequently remaining symptoms of

COVID-19 after elimination of the virus, indicated that IMU-838 may have the potential to contribute to the prevention of long-term fatigue.

Finally, IMU-838 was found to be safe and well-tolerated in hospitalized patients with moderate COVID-19.

Phase 2 Trial of IMU-838 in Primary Sclerosing Cholangitis (“PSC”)

On February 18, 2021, Immunic announced positive top-line data from its investigator-sponsored proof-of-concept clinical trial of IMU-838 in PSC, which was conducted at Mayo Clinic in Arizona and Minnesota, both of which are tertiary referral centers for PSC patients.

As previously announced, due to the COVID-19 pandemic, only 18 of the targeted 30 patients were enrolled in the study (intent-to-treat population, “ITT”), of whom only 11 patients completed the full IMU-838 treatment course and were evaluable over the 24-week treatment period (per-protocol population, “PP”).

The PP population experienced a statistically significant decrease in serum alkaline phosphatase (“ALP”) levels (p=0.041) after 24 weeks of treatment using 30 mg IMU-838 once daily, as compared to baseline.

A consistent individual pattern of a stable decrease in ALP values was observed in the PP population between baseline and week 24, without any single patient showing an increase of more than 20% of ALP.

As per definition of the primary objective of the study, 27.3% of the patients in the PP population had a clinically relevant reduction of serum ALP higher than 25% at week 24, without an increase in liver biochemistry of more than 33%, as compared to baseline.

Regarding the secondary objectives of the study, no changes in aspartate aminotransferase (“AST”), alanine aminotransferase (“ALT”), or total, direct or indirect bilirubin were observed in the ITT or PP populations, as compared to baseline.

In addition, despite the limited scope of the data, encouraging results were observed regarding symptoms of inflammatory bowel disease (“IBD”), a common comorbidity for PSC patients, and patient assessments of health-related quality of life.

The study also found that IMU-838 is a safe and well-tolerated oral drug for PSC patients and treatment-emergent adverse events were rare and generally mild.

During the COVID-19 pandemic, recruitment for this study was hampered, as patients with PSC are at a high risk of COVID-19 infections and were advised to avoid travel and unnecessary social contacts such as those required to participate in a clinical trial.

Together with the investigators, Immunic determined to readout data of the 18 patients who were enrolled prior to the COVID-19 pandemic.

The ongoing pandemic situation also triggered the principal investigator’s decision to terminate the study in late 2020, before the intended recruitment goal of 30 patients was reached.

Immunic’s second drug candidate, IMU-935, has the potential to be a highly potent and selective inverse agonist of a transcription factor called RORγt with additional activity on DHODH.

Immunic believes that the nuclear receptor RORγt is the main driver for the differentiation of T helper 17 (“Th17”) cells and the expression of various cytokines involved in various inflammatory and autoimmune diseases.

Immunic believes this target is an attractive alternative to approved antibodies for targets such as interleukin-23 ("IL-23"), IL-17 receptor and IL-17A as well as IL-17F cytokine directly.

Immunic has observed strong cytokine inhibition targeting both Th1 and Th17 responses in preclinical testing, as well as indications of activity in animal models for psoriasis and IBD.

Preclinical experiments indicated that, while leading to a potent inhibition of Th17 differentiation and cytokine secretion, IMU-935 did not affect thymocyte maturation, one of the physiological functions of RORγt, and therefore reduces the risk for thymoma development in patients.

Based on these preclinical data, Immunic believes that IMU-935 has potential to be a best-in-class therapy for various autoimmune diseases and beyond.

A clinical Phase 1 trial exploring safety, pharmacodynamics and pharmacokinetics of IMU-935 is currently ongoing and progressing.

Subsequent to the ongoing single and multiple ascending dose parts of the trial in healthy volunteers, Immunic plans to extend this trial to assess safety and exploratory disease endpoints in patients with psoriasis.

Upon completion of at least the first two cohorts of the multiple ascending dose portion in healthy volunteers, the Company anticipates that it may also begin a Phase 2a proof-of-concept clinical trial of IMU-935 in an orphan autoimmune indication.

After a thorough review of suitable autoimmune conditions, Immunic has prioritized GBS as additional indication for IMU-935, as previously announced.

Immunic’s third program, IMU-856, which Immunic believes to be novel and highly innovative, is an orally available, small molecule modulator that targets a protein which serves as a transcriptional regulator of intestinal barrier function.

Immunic has not yet disclosed the molecular target for IMU-856.

Based on preclinical data, Immunic believes this compound represents a new and potentially disruptive treatment approach, as the mechanism of action targets the restoration of the intestinal barrier function in patients suffering from diseases like IBD, diarrhea-predominant irritable bowel syndrome (“IBS-D”), immune checkpoint inhibitor (“ICI”)-induced colitis, and other intestinal barrier function associated diseases.

Immunic believes that because IMU-856 avoids suppression of the immune functions, it should therefore maintain immune surveillance for patients.

On August 20, 2020, Immunic announced dosing of the first healthy volunteer in a clinical Phase 1 trial of IMU-856.

Immunic Australia Pty Ltd.

received clearance from the Bellberry Human Research Ethics Committee in Australia to begin a Phase 1 trial of IMU-856 under the Clinical Trial Notification scheme of the Australian Therapeutic Goods Administration.

The clinical Phase 1 trial is ongoing and progressing.

The trial includes single and multiple ascending dose parts in healthy volunteers to assess safety, pharmacodynamics and pharmacokinetics of IMU-856.

Subsequently, Immunic plans to extend this trial to assess biomarkers, disease symptoms, safety and drug trough levels in patients with several conditions involving an impaired bowel barrier function.

Vidofludimus Calcium (IMU-838)

Phase 3 Program of Vidofludimus Calcium in RMS (ENSURE-1 and ENSURE-2 Trials)

On July 1, 2021, we announced U.S.

Food and Drug Administration (“FDA”) clearance of our Investigational New Drug (“IND”) application for the Phase 3 ENSURE program of our lead product candidate, vidofludimus calcium in patients with RMS.

The ENSURE program comprises two identical multicenter, randomized, double-blind Phase 3 trials designed to evaluate the efficacy, safety, and tolerability of vidofludimus calcium versus placebo in RMS patients.

Based on vidofludimus calcium’s highly significant activity in preventing lesion formation in our Phase 2 EMPhASIS trial in RMS, the strong and consistent correlation observed between lesion formation and clinical relapse in third-party clinical trials, and the drug’s robust safety profile to date, we believe that this Phase 3 program should provide a relatively simple and straightforward path towards potential regulatory approval of vidofludimus calcium in RMS.

Each of the identical twin Phase 3 trials, titled ENSURE-1 and ENSURE-2, is expected to enroll approximately 1,050 adult patients with active RMS at more than 100 sites in more than 15 countries, including the United States, India and countries in Latin America, Central and Eastern Europe.

Patients will be randomized in a double-blinded fashion to either 30 mg daily doses of vidofludimus calcium or placebo and the primary endpoint for both trials is time to first relapse up to 72 weeks.

Key secondary endpoints include volume of new T2-lesions, time to confirmed disability progression, time to sustained clinically relevant changes in cognition, and percentage of whole brain volume change.

With regard to the disability progression endpoint, the ENSURE program will apply a pooled analysis of disability worsening across both trials.

The ENSURE trials will be run concurrently.

The first patient in ENSURE-1 was enrolled in November 2021.

The first patient in ENSURE-2 was enrolled in January 2022.

An interim analysis to assess event rates is planned to occur after a certain number of relapses have occurred in the double-blind treatment periods.

This analysis is intended to inform potential sample size adjustment and help ensure that final study readout is not planned to occur before sufficient events have been achieved.

This interim analysis will also allow for a non-binding futility analysis.

Phase 2 Program of Vidofludimus Calcium in PMS (CALLIPER Trial)

On July 1, 2021, we announced that the FDA also cleared our separate IND application for the supportive Phase 2 CALLIPER trial of vidofludimus calcium in patients with PMS.

The first patient was enrolled in September 2021.

The multicenter, randomized, double-blind, placebo-controlled Phase 2 CALLIPER trial in PMS is intended to run concurrently with and to complement the Phase 3 program in RMS.

In particular, CALLIPER is focused on progressive forms of multiple sclerosis (“MS”) and is designed to corroborate vidofludimus calcium’s neuroprotective potential, as exemplified by slowing of brain atrophy and delay in disability worsening.

Neurodegeneration is a key concern in both PMS and RMS, since axonal and neural damage is responsible for the increasing and often severe disability experienced by patients.

We believe that, if the CALLIPER trial is successful in showing a beneficial effect of vidofludimus calcium, this data, along with the ENSURE program and vidofludimus calcium’s strong safety and tolerability profile, may allow for a meaningful clinical differentiation of vidofludimus calcium from other oral MS medications and a potentially attractive commercial positioning.

Although a supportive trial, we do not believe that data from the CALLIPER trial are a pre-condition for filing a New Drug Application (“NDA”) in RMS.

Additional clinical studies and the potential regulatory path forward specific to the treatment of PMS will be informed by the results of the CALLIPER trial and will be further assessed accordingly.

The Phase 2 CALLIPER trial is expected to enroll approximately 450 patients with PMS at more than 70 sites in North America, Western, Central and Eastern Europe with patients randomized to either 45 mg daily doses of vidofludimus calcium or placebo in a double-blinded fashion.

The trial’s primary endpoint is the annualized rate of percent brain volume change up to 120 weeks.

Key secondary endpoints include the annualized rate of change in whole brain atrophy and time to 24-week confirmed disability progression based on the expanded disability status scale which may further support disability data from the ENSURE trials.

An interim analysis comprising an unblinded analysis of serum neurofilament light chain (“NfL”) is planned to occur once approximately half of the enrolled patients have completed 24 weeks of treatment.

NfL has been shown in third-party research to consistently correlate with disease activity in neurodegenerative disorders and has become one of the most important serum biomarkers for axonal damage over the past few years.

As previously reported, results of the Phase 2 EMPhASIS trial of vidofludimus calcium in RRMS showed a robust decrease in serum NfL at 24 weeks (-17.0% for 30 mg and -20.5% for 45 mg), as compared to baseline values, while the patients on placebo experienced a 6.5% increase in serum NfL over the same period.

Phase 2 Trial of Vidofludimus Calcium in UC (CALDOSE-1 Trial)

On October 28, 2021, we announced completion of enrollment of our Phase 2 CALDOSE-1 trial of vidofludimus calcium in UC.

At completion of patient recruitment, the trial has randomized a total of 263 patients into four arms:

three active dosing arms of 10 mg, 30 mg and 45 mg, as well as placebo.

Top-line data for the induction phase are expected to be available in June of 2022.

On February 18, 2022, we announced the main blinded baseline characteristics of the CALDOSE-1 trial, including:

• 263 moderate-to-severe UC patients were enrolled in 78 study sites with the Ukraine and Poland representing the countries with highest number of patients and U.S.

sites contributing 12.5% of the overall enrollment.

• Of the 263 patients, 148 (56.3%) were male and 115 (43.7%) were female patients.

The mean age at baseline was 41.7 (18-77) years.

• All patients had to have failed at least one prior therapy option.

Of the 263 patients, 83% were biologically naïve and 17% were biologically experienced (received at least 1 prior treatment with any biological agent approved in the UC indication).

• Enrolled patients had to show evidence of active moderate-to-severe UC disease.

This is reflected in their baseline characteristics for patient-reported outcomes:

◦ The baseline Mayo stool frequency scores were:

(i) score of 3 for 59% of patients, (ii) score of 2 for 36% patients and (iii) score of 1 for 5% of patients.

◦ The Mayo rectal bleeding scores were:

(i) score of 3 in 10% of patients, (ii) score of 2 for 54% of patients and (iii) score of 1 for 31% of patients.

◦ The average value for fecal calprotectin at baseline was approximately 1,320 μg/g for currently available, yet incomplete data.

• The trial employed a central independent reader to evaluate the endoscopic eligibility criteria and the following modified Mayo endoscopic scores were assessed at baseline:

◦ 55% of patients with a score of 3;

◦ 45% of patients with a score of 2.

• At week 10 (the time point of the primary efficacy analysis), an adjudication procedure was used for endoscopy assessments.

In the case of disagreement between two independent readers, a third independent reader was used for adjudication.

We believe that these blinded baseline characteristics of randomized patients and the methodology regarding endoscopic assessments contributes to ensuring an optimized study read-out.

Phase 2 Trial of Vidofludimus Calcium in PSC

On February 18, 2021, we announced positive top-line data from our investigator-sponsored proof-of-concept clinical trial of vidofludimus calcium in PSC, which was conducted at Mayo Clinic in Arizona and Minnesota, both of which are tertiary referral centers for PSC patients.

As the next step in this indication, we are currently conducting a Phase 1 trial in hepatic impaired patients in order to explore dose optimization of vidofludimus calcium for potential future clinical activities in PSC.

This Phase 1 trial started in September 2021 and is expected to run approximately six months.

Phase 1 Clinical Trial of IMU-935 in Healthy Human Subjects and Moderate to Severe Psoriasis Patients

On July 12, 2021, we provided an update on our IMU-935 program, including new preclinical and clinical data.

The main result from preclinical investigations was that IMU-935 inhibits cytokine production (thought to be a pre-condition for its use in immunological and autoimmune diseases) while maintaining the known and required physiological functions of maturing T lymphocytes.

In ex vivo mouse cell differentiation and maturation assays, IMU-935 was recently observed to selectively inhibit RORγt-dependent gene expression during Th17 differentiation without affecting either RORγt-dependent gene regulation relevant to thymocyte development, or the viability of these cells.

In third-party research, impairment of thymocyte development has been shown to be associated with serious safety issues, including, among others, T cell malfunction and potential lymphoma formation.

We believe that IMU-935's observed selectivity may enable it to inhibit both the generation of Th17 cells and the production of IL-17 cytokines that are responsible for the development of autoimmune diseases, without impairing thymocyte development, which is associated with the potential risk of lymphoma seen with other, third-party RORγt programs.

On December 14, 2021, we provided an update on the preclinical and clinical development of IMU-935, announcing that:

• Unblinded data from the single ascending dose part of the ongoing phase 1 clinical trial of a new powder-in-capsule formulation of IMU-935, in which healthy human subjects were treated with 100 mg, 200 mg, 300 mg and 400 mg of this new formulation or placebo, found these single ascending daily doses of IMU-935 to be safe and well-tolerated, and no maximum tolerated dose was reached.

No serious adverse events occurred.

A dose-proportional pharmacokinetic profile was observed across the investigated dose range.

• Unblinded data from the multiple ascending dose part of the ongoing phase 1 clinical trial, in which healthy human subjects were dosed for 14 days with 150 mg either once or twice daily doses of IMU-935 or placebo, found these multiple ascending doses of IMU-935 to be safe and well-tolerated, and no maximum tolerated dose was reached.

Treatment emergent adverse events were generally mild in severity, with moderate treatment emergent adverse events reported in one of eleven IMU-935 treated subjects, compared with one of four subjects on placebo.

No serious adverse events were reported.

No dose-dependent changes in laboratory values (including no effects on liver enzymes or in hematological parameters), vital signs or in electrocardiographic evaluations were found.

Pharmacokinetic analysis showed that stable steady-state plasma concentrations were achieved within the first week of dosing with an accumulation factor for IMU-935 allowing predictable trough levels during daily dosing.

• Based on the favorable safety and tolerability data observed in healthy human subjects, our phase 1 clinical trial of IMU-935 was expanded in October 2021 to include a third portion, part C, in which moderate to severe psoriasis patients are to be randomized to 28-day treatment of IMU-935 or placebo.

Planned assessments include safety, tolerability, pharmacokinetic and pharmacodynamic markers, as well as skin evaluations.

Recruitment of part C depends on several external factors which are not under our direct control, including, in particular, the relatively restrictive COVID-19-related rules in effect in Australia and New Zealand.

This situation has and may further influence our ability to enroll study participants and/or perform on-site monitoring at clinical sites in those locations.

In light of this, we have already initiated remedial measures, including the potential addition of sites outside of Australia and New Zealand, for the ongoing part C of IMU-935 in psoriasis patients.

As a result, initial results from the third portion of the Phase 1 clinical trial in patients with moderate-to-severe psoriasis are now expected to be available in the second half of 2022, instead of at the end of the second quarter of 2022, as previously announced.

• In previous preclinical in vitro data, it was shown that IMU-935 selectively inhibits Th17 differentiation and IL-17 production, whereas RORγt was unaffected by IMU-935 during thymocyte maturation and, therefore, does not harm normal thymocyte maturation.

Newly obtained data from acute and chronic treatment of mice corroborated in vivo that IMU-935 is the first molecule observed to impact neither thymus size, thymocyte numbers, nor the maturation status of thymocytes, in contrast to two other known inhibitors of RORγt.

Phase 1 Clinical Trial of IMU-935 in mCRPC

On July 12, 2021, we also presented new preclinical data highlighting IMU-935's therapeutic potential in CRPC.

Recently published third-party studies have shown that RORγ plays an important pro-tumor role by driving expression of the androgen receptor (“AR”), leading to tumor growth.

During tumor progression, AR tends to mutate into AR-V7, leading to resistance of AR-axis-targeted therapies.

In preclinical studies, IMU-935 was observed to inhibit the expression of mutated AR-V7, and the tumor growth of prostate cancer cell lines in vitro .

Finally, we believe IMU-935's potency in inhibiting tumorigenesis-promoting IL-17 and Th17 cells in vitro may result in further antitumoral activity in humans.

Based on these strong preclinical results, we have initiated an open-label Phase 1 dose-escalation trial designed to evaluate the safety and tolerability of increasing doses of IMU-935 to establish the maximum tolerated dose and the recommended phase 2 dose.

The trial will also evaluate the anti-tumor activity of IMU-935 by means of prostate-specific antigen levels, circulating tumor cell numbers, and radiographic response assessments of tumor progression.

The trial’s Principal Investigator is Johann Sebastian de Bono, MD, PhD, Regius Professor of Cancer Research and Professor in Experimental Cancer Medicine, The Institute of Cancer Research, London, and The Royal Marsden NHS Foundation Trust, London, United Kingdom.

The trial was approved by the Medicines and Healthcare products Regulatory Agency (MHRA), the Research Ethics Committee (REC) and the Health Research Authority (HRA) in the United Kingdom.

The first patient was enrolled in December 2021.

Initial clinical safety data are expected to be available in the third quarter of 2022.

Phase 1 Clinical Trial of IMU-856

A Phase 1 clinical trial of IMU-856 is ongoing and progressing in Australia.

The trial includes single and multiple ascending dose parts in healthy human subjects designed to assess safety, pharmacodynamics and pharmacokinetics of IMU-856.

All planned single ascending dose cohorts for the current tablet formulation of IMU-856 have been completed but have not yet been unblinded.

Based on the favorable data available so far, the Ethics Committee in Australia has agreed to proceed to the multiple ascending dose part which is currently being dosed.

Unblinded safety data from the single and multiple ascending dose parts in healthy human subjects are expected to be available in the third quarter of 2022.

We also plan to extend this trial to assess biomarkers, disease symptoms, safety and drug trough levels in patients with a model disease of altered intestinal barrier function to provide initial activity data.

Initiation of this third portion of the Phase 1 clinical trial is expected in the first half of 2022.

Product Acquisition History

Immunic’s wholly-owned subsidiary Immunic AG acquired IMU-838 and IMU-935 in September 2016 from 4SC AG (hereinafter, 4SC), a publicly traded company based in Planegg-Martinsried, Germany, through asset acquisitions.

As part of the transaction, 4SC is entitled to receive a royalty on net sales if products originating from these acquisitions achieve market approval.

Immunic’s rights to IMU-856 are secured pursuant to an option and license agreement (the “Daiichi Sankyo Option”) with Daiichi Sankyo Co., Ltd.

Our wholly-owned subsidiary Immunic AG acquired IMU-838 and IMU-935 in September 2016 through asset acquisitions from 4SC AG (hereinafter, “4SC”), a publicly traded company based in Planegg-Martinsried, Germany.

31, 2021, Immunic AG and 4SC entered into a Settlement Agreement, pursuant to which Immunic AG settled its remaining obligation of a 4.4% royalty on net sales for $17.25 million.

The payment was made 50% in cash and 50% in shares of Immunic’s common stock.

Our rights to IMU-856 are secured pursuant to an option and license agreement (the “Daiichi Sankyo Option”) with Daiichi Sankyo Co., Ltd.

(hereinafter, "Daiichi Sankyo") in Tokyo, Japan.

On January 5, 2020, Immunic AG exercised its option under the Daiichi Sankyo Option and acquired the exclusive global rights to commercialize IMU-856.

On January 5, 2020, Immunic AG exercised its option under the Daiichi Sankyo Option to acquire the exclusive global rights to commercialize IMU-856.

The license also grants Immunic AG the rights to Daiichi Sankyo’s patent application related to IMU-856.

Concurrent with the option exercise, Immunic AG paid to Daiichi Sankyo a one-time upfront licensing fee.

Going forward, Daiichi Sankyo is eligible to receive future development, regulatory and sales milestone payments, as well as royalties related to IMU-856.

Financial terms of the agreement have not been disclosed.

Immunic is led by a team of dedicated and committed experienced professionals with an entrepreneurial spirit and track record of successful licensing transactions in the healthcare industry worldwide (EU, the United States and Asia).

We are led by a team of dedicated and committed experienced professionals with an entrepreneurial spirit and track record of successful licensing transactions in the healthcare industry worldwide (EU, the United States and Asia).

The team brings together several decades of leadership experience in the pharmaceutical industry with a strong scientific background and sound knowledge in drug discovery, product development, chemistry, manufacturing and controls processes, intellectual property, clinical trial design, health economics and market access, merger and acquisitions, capital markets, corporate finance, business development, regulatory affairs and project valuation.

Immunic’s team members are inventors on project-related patents and have successfully published project-related scientific publications.

Our team members are inventors on project-related patents and have successfully published project-related scientific publications.

Product Candidates

IMU-838 is a small molecule investigational drug (vidofludimus calcium) under development as an oral tablet formulation for the treatment of RRMS, IBD and other chronic inflammatory and autoimmune diseases.

Vidofludimus Calcium (IMU-838)

Vidofludimus calcium is a small molecule investigational drug in development as an oral tablet formulation for the treatment of RMS, IBD and other chronic inflammatory and autoimmune diseases.

By inhibiting DHODH, a key enzyme of pyrimidine de novo biosynthesis, highly metabolically activated T and B immune cells experience metabolic stress, which leads to a modulation of their activity and function.

Thereby, pro-inflammatory cytokines, such as interferon gamma (“IFN γ ”), tumor necrosis factor alpha (“TNF α ”), IL-17A and IL-17F, produced by activated Th1 and Th17 cells, which represent subtypes of so-called T helper cells, are repressed and thereby reduce the inflammation associated with IBD, MS and other chronic inflammatory diseases.

In preclinical studies of vidofludimus, the active ingredient of IMU-838, apoptosis (or programmed cell death) was induced in activated T cells, which Immunic believes may also play a crucial role in the activity of the drug in IBD by further dampening the inflammatory response.

Immunic believes that a key advantage of DHODH inhibition, in general, is that the sensitivity of specific immune cells to DHODH inhibition correlates with their intracellular metabolic activation state, and therefore may not negatively impact “normal” immune and bone marrow cells.

In animal studies of IMU-838, animals treated with large doses of the active moiety of IMU-838 were shown to lack detrimental effects on bone marrow, supporting the lack of an unspecific anti-proliferative effect regularly seen with many traditional immunomodulators.

Based on the selectivity toward metabolically activated cells (with a high need for ribonucleic acid and deoxyribonucleic acid production), DHODH inhibition also leads to a direct antiviral effect, which has been observed in various virus infected cells, such as hepatitis C virus infections, cytomegalovirus infections and even hemorrhagic fever-causing viruses, such as Arena virus infections.

Treatment with IMU-838 may avoid virus reactivation, one of the major drawbacks of the long-term use of traditional immunomodulators in IBD patients.

Efficacy of vidofludimus, the active moiety and free acid form of IMU-838, has been observed in several animal disease models for IBD, as well as systemic lupus erythematosus and transplant rejection.

Previous filings by Immunic with the SEC have summarized the development history of vidofludimus and the previous amorphous formulation of the free acid form of

vidofludimus.

After the consummation of the asset acquisition from 4SC, Immunic developed and filed a patent application for a new specific polymorph of the calcium salt formulation of vidofludimus, IMU-838, which Immunic believes exhibits improved physicochemical and pharmacokinetic properties.

In 2017, Immunic completed two Phase 1 studies of single or repeated once-daily doses of IMU-838 in healthy volunteers, where Immunic observed results supporting tolerability of repeated daily dosing of up to 50 mg of IMU-838.

In preclinical studies of vidofludimus, the active moiety and free acid form of vidofludimus calcium, apoptosis (or programmed cell death) was induced in activated T cells, which we believee may also play a crucial role in the activity of the drug in IBD by further dampening the inflammatory response.

We believe that a key advantage of DHODH inhibition, in general, is that the sensitivity of specific immune cells to DHODH inhibition correlates with their intracellular metabolic activation state, and therefore may not negatively impact “normal” immune and bone marrow cells.

In animal studies of vidofludimus calcium, animals treated with large doses of the active moiety of vidofludimus calcium were shown to lack detrimental effects on bone marrow, supporting the lack of an unspecific anti-proliferative effect regularly seen with many traditional immunomodulators.

Based on the selectivity toward metabolically activated cells (with a high need for ribonucleic acid and deoxyribonucleic acid production), DHODH inhibition also leads to a direct antiviral effect, which has been observed in various virus infected cells, such as Epstein-Barr virus (“EBV”) infections, hepatitis C virus infections, severe acute respiratory syndrome coronavirus 2 (“SARS-CoV-2”) infections, cytomegalovirus infections and even hemorrhagic fever-causing viruses, such as Arena virus infections.

Treatment with vidofludimus calcium may avoid virus infections and reactivations, one of the major drawbacks of the long-term use of traditional immunomodulators in IBD and MS patients.

Recently, we presented preclinical data demonstrating the activity of vidofludimus calcium to prevent the reactivation of latent EBV infection into lytic infection

(Marschall et al.

This mechanism may lead to reduce the regular cycle of reactivations and reinfections in the medium term, and thus the latent persistent EBV infection in patients in the long term.

Efficacy of vidofludimus has been observed in several animal disease models for IBD, MS, as well as systemic lupus erythematosus and transplant rejection.

Previous filings by us with the SEC have summarized the development history of vidofludimus and the previous amorphous formulation of the free acid form of vidofludimus.

After the consummation of the asset acquisition from 4SC, Immunic developed and filed a patent application for a new specific polymorph of the calcium salt formulation of vidofludimus, vidofludimus calcium, which we believe exhibits improved physicochemical and pharmacokinetic properties.

In 2017, we completed two Phase 1 studies of single or repeated once-daily doses of vidofludimus calcium in

healthy volunteers, where we observed results supporting tolerability of repeated daily dosing of up to 50 mg of vidofludimus calcium.

Multiple Sclerosis

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MS is a progressive disease which, without effective treatment, leads to severe disability.

Immunic is developing IMU-838 for the treatment of RRMS, the most common form of MS.

We are developing vidofludimus calcium for the treatment of RRMS, the most common form of MS.

Approximately 85% of patients with MS are expected to develop RRMS, with some of these patients later developing more progressive forms of the disease.

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However, most important for diagnosis are characteristic CNS lesions found using magnetic resonance imaging ("MRI").

According to Wallin et al.

(2019), MS affects more than 700,000 people in the United States, and more than 2.2 million people worldwide.

According to DRG (Market Forecast Dashboard, Multiple Sclerosis (2020-2030), December 2021), MS affects more than 500,000 people in the United States, and more than 1.1 million people in the G7 countries (US, UK, Canada, Japan, Germany, France, Italy).

The disease has a large economic impact as it affects mainly young adults in the prime working age, peaking around 30 years old, although MS can occur in children and in adults.

MS is at least two to three times more common in women than in men.

MS is up to three times more common in women than in men.

MS affects twice as many women and men in certain age cohorts and is more common in areas inhabited by people of northern European ancestry, such as Europe, the United States, Canada, New Zealand and parts of Australia.

A recent publication shed new light on the role of infection with the EBV previously postulated to trigger MS.

Bjornevik et al.

(2022) analyzed EBV antibodies in serum from 801 individuals who developed MS among a cohort of more than 10 million people active in the US military over a 20-year period (1993 to 2013).

Risk of MS increased 32-fold after infection with EBV but was not increased after infection with other viruses, including the similarly transmitted cytomegalovirus.

Serum levels of neurofilament light chain, a biomarker of axonal damage, increased only after EBV seroconversion.

These findings cannot be explained by any known risk factor for MS and suggest EBV as the leading cause of MS.

In addition, antibody producing cells directed against the latent EBV protein EBNA1 were found in the CSF of MS patients.

Cross reactivity of anti-EBNA1 antibodies against GlialCAM, a protein that is predominantly expressed in glial cells in the CNS and potentially important in the myelination process of axons, further corroborates the connection between EBV infections and pathologic processes in MS (Lanz et al.

Current Treatment Options

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The latter are referred to as disease-modifying therapies.

Immunic intends to develop IMU-838 as a disease-modifying therapy for RRMS.

The main first-line treatment options for RRMS patients are beta interferons (either as interferon beta-1a or interferon beta-1b) or glatiramer acetate, all of which are given by injection.

We intend to develop vidofludimus calcium as a disease-modifying therapy for RRMS.

The initial treatment options for RRMS patients are often beta interferons (either as interferon beta-1a or interferon beta-1b) or glatiramer acetate, all of which are given by injection.

For patients requiring more advanced treatment options, there are several oral medications, such as dimethyl fumarate, fingolimod, siponimod, teriflunomide, ozanimod or cladribine, and biologics, such as natalizumab, ocrelizumab, ofatumumab or alemtuzumab, approved for commercial use in MS in various countries.

In addition, some of these drugs, such as fingolimod, already have generic versions available in some countries and other drugs will become generic in the next years.

In addition, some of these drugs already have generic versions available in some countries and other drugs will become generic in the next years.

There is no specific guidance on which therapies or medications are used in which sequence of the MS disease course.

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• Safety/tolerability aspects.

Despite many therapies approved and nearing approval for relapsing forms of MS, many opportunities remain for a safe, oral, well-tolerated, robust anti-inflammatory, with neuroprotective properties beyond what would be expected by reducing inflammation.

DHODH inhibitors have already shown a particular advantage in the inhibition of disability worsening.

Currently, only a few new oral treatment options for RRMS patients are in advanced clinical development, the most advanced being a Bruton's tyrosine kinase (“BTK”) inhibitor developed by Sanofi.

This BTK inhibitor (SAR442168) is an oral, brain-penetrant, selective small molecule that met both the primary and secondary endpoints in a Phase 2b trial evaluating efficacy and safety in participants with relapsing forms of MS.

It significantly reduced disease activity associated with MS, as measured by MRI.

Sanofi has now initiated a global, randomized, double-blind efficacy and safety trial comparing SAR442168 to teriflunomide in 900 participants with relapsing forms of MS.

The trial will assess efficacy of daily SAR442168 treatment, as compared to a daily dose of 14 mg teriflunomide measured by annualized adjudicated relapse rate (“ARR”) in participants with relapsing forms of MS.

Secondary objectives will assess efficacy of SAR442168, as compared to teriflunomide, on disability progression, MRI lesions, cognitive performance and quality of life.

Evobrutinib, a BTK inhibitor developed by EMD Serono, and BIIB091, a BTK inhibitor developed by Biogen, are currently in phase 2 clinical development.

In addition, Roche is developing fenebrutinib in a phase 3 program for RRMS and primary progressive MS in clinical Phase 3.

Many drugs approved for patients with RRMS have reported a rare and often lethal viral disease of the brain called progressive multifocal leukoencephalopathy ("PML").

Many disease-modifying therapies alter how the immune system functions, including its ability to effectively fight viral infections.

As a result, people who take these therapies are at higher risk for John Cunningham virus infection or re-activation, which is believed to be the cause of PML.

Many drugs approved for patients with RRMS suppress the immune system, either broadly or by targeting classes of immune cells, altering how the immune system functions and fights certain infections.

As a result, people who take these therapies are at higher risk for John Cunningham virus infection or re-activation, which is believed to be the cause of a rare and often lethal viral disease of the brain called progressive multifocal leukoencephalopathy ("PML").

To date, occurrences of PML have been reported in individuals with RRMS treated with natalizumab, dimethyl fumarate and fingolimod.

No case of PML has yet been reported for the DHODH inhibitor teriflunomide, which has been one of the key differentiators of teriflunomide from other disease-modifying therapies in RRMS.

The active moiety of IMU-838 has also shown direct antiviral effects in several models of virus-infected cells, which Immunic believes is caused by DHODH inhibition.

Subject to further clinical trials, Immunic believes that this could be a “class effect” of the DHODH inhibitors and if shown, could be an important potential differentiator against other drug classes in RRMS.

Depending on the results of future clinical trials, Immunic believes that IMU-838 has the potential to demonstrate medically important advantages compared with other treatments, particularly for the early treatment of RRMS patients, due to its placebo like safety profile and its robust anti-inflammatory and neuroprotective properties.

IMU-838 could provide RRMS patients with a distinctive combination of robust efficacy and favorable safety and tolerability including the following properties:

• A robust MRI lesion suppression of IMU-838 compares favorably to other first-line and oral base medications commercially available in RRMS.

• A very low discontinuation rate for IMU-838-treated RRMS patients, substantially below placebo, indicates an encouraging combination of tolerability and efficacy.

• The absence of hepatotoxicity signals and other relevant adverse events leading to discontinuations distinguishes IMU-838 well from other oral RRMS treatments.

• A robust decrease in serum neurofilament light chain, a biomarker for axonal damage, was observed for IMU-838 and provides evidence of IMU-838’s potential neuroprotective activity.

The active moiety of vidofludimus calcium has also shown direct antiviral effects in several models of virus-infected cells, which we believe is caused by DHODH inhibition.

Subject to further clinical trials, we believe that this could be a “class effect” of the DHODH inhibitors and if shown, could be an important potential differentiator against other drug classes in RRMS.

Depending on the results of future clinical trials, we believe that vidofludimus calcium has the potential to demonstrate medically important advantages compared with other treatments, particularly for the early treatment of RRMS patients, due to its anti-inflammatory and neuroprotective properties and safety and tolerability profile.

Vidofludimus calcium could provide RRMS patients with a distinctive combination of the following properties:

• Targeted effect on hyperactive immune cells without suppression of normal immune function.

• Pronounced MRI lesion suppression of vidofludimus calcium compares favorably to other oral medications commercially available in RRMS.

• Improved rates of disability worsening, particularly in light of the apparent class effect of DHODH inhibition to disproportionally improve disability progression over the long-term.

• Robust decrease in serum neurofilament light chain, a biomarker for axonal damage, was observed for vidofludimus calcium and provides evidence of vidofludimus calcium’s potential neuroprotective activity.

• A very low discontinuation rate for vidofludimus calcium-treated RRMS patients, substantially below placebo, indicates an encouraging combination of tolerability and efficacy as well as maintenance of normal quality-of-life

• Absence of hepatotoxicity signals and other relevant adverse events leading to discontinuations distinguishes vidofludimus calcium well from other oral RRMS treatments.

• Broad spectrum antiviral effect of vidofludimus calcium may support in lowering the rate of viral infections and reactivations, including EBV reactivation, potentially resulting in slowing potential EBV-related neurodegenerative processes.

Current Development Plan and Ongoing Studies

Phase 2 Trial of IMU-838 in RRMS (EMPhASIS Trial)

Immunic is developing IMU-838 for use in RRMS.

The clinical Phase 2 trial design in RRMS is based on well-established MRI endpoints (i.e., the difference between the two dose groups of 30 mg/day and 45 mg/day of IMU-838 and placebo in the cumulative number of combined unique active MRI lesions up to week 24).

Immunic has not obtained formal regulatory advice for the Phase 2 study of IMU-838 in RRMS.

Further information regarding Immunic’s RRMS study can be found on ClinicalTrials.gov under the identifier NCT03846219.

On August 2, 2020, Immunic announced positive top-line data from its Phase 2 EMPhASIS trial of IMU-838 in patients with RRMS.

Phase 2 Trial of Vidofludimus Calcium in RRMS (EMPhASIS Trial)

Our Phase 2 EMPhASIS trial of vidofludimus calcium in RRMS consisted of two cohorts:

The full data set of Cohort 1, which evaluated efficacy and safety of 30 mg or 45 mg once daily vidofludimus calcium compared to placebo, was published by us in August and September 2020, respectively.

Cohort 2, which evaluates efficacy and safety of 10 mg once daily vidofludimus calcium compared to placebo, was meanwhile also completed.

On August 2, 2020, we announced positive top-line data from our Phase 2 EMPhASIS trial of vidofludimus calcium in patients with RRMS.

The study achieved statistical significance on all primary and key secondary endpoints, indicating activity in RRMS patients.

In particular, the study met its primary endpoint, demonstrating a statistically significant reduction in the cumulative number of CUA MRI lesions up to week 24 in patients receiving 45 mg of IMU-838 once daily, by 62% (p=0.0002), as compared to placebo.

In particular, the study met its primary endpoint, demonstrating a statistically significant reduction in the cumulative number of combined unique active (“CUA”) magnetic resonance imaging (“MRI”) lesions up to week 24 in patients receiving 45 mg of vidofludimus calcium once daily, by 62% (p=0.0002), as compared to placebo.

The study also met its key secondary endpoint, showing a statistically significant reduction in the cumulative number of CUA MRI lesions for the 30 mg once daily dose by 70% (p<0.0001), as compared to placebo.

September 11, 2020, the Company published the full unblinded clinical data set from its Phase 2 EMPhASIS trial of IMU-838 in patients with RRMS.

On September 11, 2020, we published the full unblinded clinical data set from our Phase 2 EMPhASIS trial of vidofludimus calcium in patients with RRMS.

The data confirmed and expanded on the previously announced top-line results.

Activities Relating to the Preparation of a Phase 3 Program of IMU-838 in RRMS

Phase 2 Trial of IMU-838 in RRMS (EMPhASIS Trial) and Related Activities

The results of the Phase 2 trial of IMU-838 in RRMS were publicized on August 2, 2020 and September 11, 2020.

Based on these results, 30 and 45 mg/day doses of IMU-838 appear to be equally safe and efficacious in patients with RRMS.

Based on established regulatory guidance that the lowest effective dose should be considered for future clinical trials, Immunic may propose the dose of 30 mg/day of IMU-838 for investigation in a Phase 3 program.

Currently, the Company considers this to be the most likely conclusion based on the Phase 2 data of IMU-838 in RRMS.

For this reason, Immunic has started an additional, small Cohort 2 sub-trial to obtain exploratory data on the expanded dose response of IMU‑838, as previously announced.

This additional, double-blind assessment includes a cohort of approximately 60 patients who receive 10 mg/day of IMU-838 or placebo for 24 weeks.

The still-active sites of the Phase 2 trial of IMU-838 in RRMS continue to be used and, as a result, Immunic currently expects that this assessment can be executed in an accelerated fashion.

The results of this additional, small patient cohort are not expected to change any conclusions for dosing of IMU-838 in a future Phase 3 program.

Rather, they are expected to provide additional data to address any potential regulatory requests for pharmacodynamic modeling of the dose-response relationship in the context of the design of a Phase 3 program.

An unblinded interim analysis of selected MRI data is planned after all Cohort 2 patients have completed week 12 MRI assessments.

In the main analysis done for this trial in August and September 2020, a recognizable reduction of the number of CUA and gadolinium-enhancing lesions by IMU-838, as compared to placebo, was already observed at week 12.

This additional interim analysis will, therefore, provide a beneficial assessment of the dose-response of the 10 mg/day of IMU-838 dose and may facilitate expeditious regulatory review for the execution of a Phase 3 program.

This additional study cohort is already fully enrolled and the Company expects the 12-week data to be available at the end of March or in early April 2021.

Immunic believes that the foregoing strategy for IMU-838 in RRMS will enable risk reduction for end-of-Phase 2 discussions with regulatory agencies.

The Company currently does not expect any significant delays for the start of a Phase 3 program.

Preparation for End-of-Phase 2 Discussions with Regulatory Agencies

In addition to providing data from Phase 2 trials, Immunic must also conduct end-of-Phase 2 discussions with regulatory agencies and provide the opportunity to discuss the necessary aspects of a Phase 3 program.

Immunic intends to submit formal end-of-Phase 2 meeting requests to discuss the proposed Phase 3 program with major regulatory authorities around the end of the first quarter of 2021.

The outcome of the end-of-Phase 2 meetings are expected to be available in or about May 2021.

On April 15, 2021, we announced interim data from Cohort 2 after 59 randomized patients completed week 12 MRI assessments.

We concluded from this data, along with previously published data from Cohort 1, that 30 mg once daily vidofludimus calcium is the most appropriate anti-inflammatory dose for Phase 3 trials in patients with RMS.

Meanwhile, final data from Cohort 2 are also available showing that the anti-inflammatory effects of vidofludimus calcium at the 10 mg dose were observed to be lower (13% reduction of gadolinium-enhancing magnetic resonance imaging lesions up to 24 weeks, as compared to placebo) than those found with the 30 mg vidofludimus calcium dose in the pooled Cohort 1 and 2 data (78% reduction), providing further support for the selection of 30 mg dosing in the ongoing ENSURE trials in RMS.

Final Cohort 2 data also provide evidence of dose-proportional neuroprotective activity.

For instance, the highest decrease of the biomarker serum neurofilament light chain was observed with the 45 mg dose of vidofludimus calcium versus placebo (-26.0% median of differences between percentage change of serum neurofilament, Hodges-Lehmann estimation), a substantial decrease was seen with the 30 mg dose (-18.0%), while the smallest decrease was observed with the 10 mg dose of Cohort 2 (-9.0%).

The 10 mg group in Cohort 2 also showed a signal with respect to improvement in Expanded Disability Status Scale (“EDSS”), consistent with those signals seen with the higher doses in Cohort 1, although all of these early signals need to be confirmed in a larger patient population with longer follow-up periods.

Taken together, these last two observations suggest that higher doses, such as 45 mg vidofludimus calcium, may be preferred doses for clinical trials in which neuroprotective effects are the main mechanism for improvement, such as in PMS.

While Cohort 1 blinded treatment was completed right before the COVID-19 pandemic started, final Cohort 2 data provide additional evidence that ongoing vidofludimus calcium treatment may reduce the risk of COVID-19 infections, presumably related to its known antiviral activity.

In the entire Cohort 2 population of 59 patients, who were enrolled during pandemic conditions, incidental COVID-19 infections in the active treatment group were less frequent (8.5%, n=4/47) than in the placebo group (25.0%, n=3/12).

Additionally, we recently obtained new preclinical data underlining that vidofludimus calcium shows potent anti-EBV activity.

We also confirmed that vidofludimus calcium can be detected to a noteworthy degree in the cerebrospinal fluid of animals, after oral dosing.

We believe that this finding suggests that vidofludimus calcium may be able to act directly within the central nervous system.

We have designed the Phase 3 trials in RMS and the Phase 2 trial in PMS to provide additional insights how vidofludimus calcium may address all aspects of the MS disease, in particular, monitoring of potential neuroprotective effects.

The EMPhASIS trial continues as an open-label extension (“OLE”) treatment to obtain long-term safety data in RRMS patients.

Currently, more than 200 patients are still on OLE treatment.

Further information regarding our EMPhASIS trial in RRMS can be found on ClinicalTrials.gov under the identifier NCT03846219.

Phase 3 Program of Vidofludimus Calcium in RMS (ENSURE-1 and ENSURE-2 Trials)

On July 1, 2021, we announced FDA clearance of our IND application for the Phase 3 ENSURE program of vidofludimus calcium in patients with RMS.

With regard to the disability progression endpoint, the ENSURE program will apply a pooled analysis of disability worsening across both trials.

The ENSURE trials will be run concurrently.

The first patient in ENSURE-1 was enrolled in November 2021.

The first patient in ENSURE-2 was enrolled in January 2022.

An interim analysis to assess event rates is planned to occur after a certain number of relapses have occurred in the double-blind treatment periods.

This analysis is intended to inform potential sample

size adjustment and help ensure that final study readout is not planned to occur before sufficient events have been achieved.

This interim analysis will also allow for a non-binding futility analysis.

Further information regarding our ENSURE program in RMS can be found on ClinicalTrials.gov under the identifiers NCT05134441 (ENSURE-1) and NCT05201638 (ENSURE-2), respectively.

The execution of clinical Phase 3 trials usually requires the use of a commercial formulation of the investigational drug manufactured at commercially usable quantities.

Immunic has developed and manufactured a roller compactor formulation of IMU-838 which would allow commercially usable production batches.

An experimental Phase 1 bioequivalence study between the previous wet granulation and the new roller compactor version of IMU-838 has completed the experimental phase and the evaluation of the results is currently ongoing.

In addition, a confirmatory relative bioavailability and food effect study is currently being prepared.

The results will further characterize the roller compactor formulation of IMU-838 in preparation for a Phase 3 program.

Manufactures under contract with us have developed and produced a roller compactor formulation of vidofludimus calcium (IMU-838-RC) which would allow commercially usable production batches.

An Phase 1 bioequivalence study between the previous wet granulation and the new IMU-838-RC formulation of vidofludimus calcium has completed the experimental phase and showed bioequivalence regarding drug exposure curve in blood plasma (area under the curve).

A confirmatory relative bioavailability and food effect study demonstrated a high bioavailability of IMU-838-RC tablets as compared to a drinking solution and confirmed the in vitro finding of a complete and fast dissolution profile in human subjects.

No food effect on the uptake or elimination of vidofludimus after administration of the IMU-838-RC tablet was observed.

Additional investigations regarding metabolite characterization, metabolic modeling and potential drug-drug interactions, as well as other activities relating to clinical pharmacology are also being finalized at this time in anticipation for presentation to regulatory authorities.

Immunic is currently working with clinical advisors to propose a pediatric development plan for IMU-838 in RRMS in the near future.

Envisaged Phase 3 Program of IMU-838 in RRMS

For this purpose and after a comprehensive selection process, a global CRO focused on regions of particular interest and with broad experience in multiple sclerosis trials was formally engaged.

This will help ensure that a potential Phase 3 program can be executed efficiently following regulatory advice.

The Company also believes that this feasibility assessment will help ensure an expeditious execution of the development strategy for IMU-838.

Immunic intends to maintain a competitive selection process for a clinical CRO to conduct the potential Phase 3 program.

Immunic plans to announce details on the design of the envisaged Phase 3 program in RRMS after its end-of-Phase 2 meetings with the regulatory authorities.

The Company currently expects the Phase 3 program to start in the second half of 2021.

We are currently working with clinical and regulatory advisors to propose a pediatric development plan for vidofludimus calcium in RRMS in the near future.

Phase 2 Program of Vidofludimus Calcium in PMS (CALLIPER Trial)

On July 1, 2021, we announced that the FDA also cleared our separate IND application for the supportive Phase 2 CALLIPER trial of vidofludimus calcium in patients with PMS.

The first patient was enrolled in September 2021.

The multicenter, randomized, double-blind, placebo-controlled Phase 2 CALLIPER trial is intended to run concurrently with and to complement the Phase 3 program in RMS.

In particular, CALLIPER is focused on progressive forms of MS and designed to corroborate vidofludimus calcium’s neuroprotective potential, as exemplified by slowing of brain atrophy and delay in disability worsening.

Neurodegeneration is a key concern in both PMS and RMS, since axonal and neural damage is responsible for the increasing and often severe disability experienced by patients.

We believe that, if the CALLIPER trial is successful in showing a beneficial effect of vidofludimus calcium, this data, along with the ENSURE program and vidofludimus calcium’s strong safety and tolerability profile, may allow for a meaningful clinical differentiation of vidofludimus calcium from other MS medications and potentially attractive commercial positioning.

Although a supportive trial, we do not believe that data from the CALLIPER trial are a pre-condition for filing an NDA in RMS.

Additional clinical studies and the potential regulatory path forward specific to the treatment of PMS will be informed by the results of the CALLIPER trial and will be further assessed accordingly.

The Phase 2 CALLIPER trial is expected to enroll approximately 450 patients at more than 70 sites in North America, Western, Central and Eastern Europe with patients randomized to either 45 mg daily doses of vidofludimus calcium or placebo in a double-blinded fashion.

The trial’s primary endpoint is the annualized rate of percent brain volume change up to 120 weeks.

An interim analysis comprising an unblinded analysis of serum NfL is planned to occur once approximately half of the enrolled patients have completed 24 weeks of treatment.

Further information regarding our CALLIPER trial in PMS can be found on ClinicalTrials.gov under the identifier NCT05054140.

Ulcerative Colitis

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The occurrence of UC worldwide has increased over the past few years, particularly in Latin America, Asia and Eastern Europe (Burisch et al.

Recent estimates note that there are more than 700,000 patients affected by UC in the United States, as well as 1.5 million in Europe ( Understanding Ulcerative Colitis , available at https://www.crohnsandcolitis.com/ulcerative-colitis (last accessed July 16, 2019);

Burisch et al.

2013) and more than 100,000 in Canada (Rocchi et al.

According to DRG (Market Forecast Dashboard, UC (2020-2030), November 2021), approximately one million patients are affected by UC in the United States, and more than 2.2 million in the G7 countries (US, UK, Canada, Japan, Germany, France, Italy).

UC is almost equally distributed between genders (Kappelman et al.

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Patients with mild disease may initially receive aminosalicylates or non-systemic steroids, such as budesonide.

Patients with moderate to severe disease activity may receive traditional immunomodulators (such as azathioprine or 6-mercaptopurine), steroids (such as prednisone) or selective immunomodulators (such as tofacitinib).

If patients fail to respond to these therapies, treatment may be escalated to the use of biologics.

Patients with moderate to severe disease activity may receive traditional immunomodulators (such as azathioprine or 6-mercaptopurine) or steroids (such as prednisone).

If patients fail to respond to these therapies, treatment may be escalated to the use of biologics or selective immunomodulators (such as tofacitinib).

The most common category of biologics used to treat UC includes TNF α antibody drugs, such as infliximab or adalimumab.

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Biologics are usually the most expensive treatment option and reserved for patients who have failed other therapies.

Treatment of UC is differentiated between induction treatment (during periods of disease symptoms or following relapse) and maintenance treatment (often a long-term treatment to keep a patient relapse-free).

Since many UC patients fail to respond to treatments, cease to respond to their treatments or develop unacceptable side effects, there is a need for safe and effective treatments for UC with novel mechanisms.

Additionally, patients prefer the convenience of oral treatments over injections.

For some of the currently available oral immunomodulators or those in clinical testing, a higher rate of infections (particularly virus re-activations) have been reported versus placebo control, which can be a medically significant event for patients.

IMU-838 is being developed to be a new treatment option for patients with moderate to severe UC who have failed current therapies and are now candidates for therapy with biologics.

Currently, there are several new oral treatment options for UC patients in advanced clinical development or in regulatory review.

Most of them fall into one of the following two categories:

S1P agonists, such as ozanimod or etrasimod, or JAK inhibitors, such as upadacitinib or filgotinib.

Some of these drug candidates may be approved by regulatory authorities for commercial use before IMU-838 may receive approval.

However, depending on the results of future clinical trials, Immunic believes that IMU-838 has the potential to demonstrate medically important advantages compared with other treatments,

particularly for long-term therapy in UC patients, due to the selectivity of DHODH targeting of metabolically activated lymphocytes, the absence of general detrimental effects on bone marrow and the direct antiviral activity.

Tofacitinib, marketed as Xeljanz by Pfizer, is a first-in-class inhibitor of kinases called JAK kinases.

Tofacitinib is particularly active on the isoform JAK3.

Based on two Phase 3 trials, tofacitinib was approved in 2018 in the United States and Europe for the treatment of UC.

Since IBD is still a substantially underserved market, several innovative late-stage projects are currently in Phase 2 and Phase 3 testing in patients with UC and/or CD.

• Filgotinib:

A JAK1 inhibitor developed by Gilead and Galapagos which delivered promising Phase 2 data in a clinical trial in UC.

However, filgotinib led to a substantial number of herpes zoster virus reactivations in patients, which may have a negative impact on the number of patients treated with this drug, if it is approved in the future.

Additional side effects are reported to have occurred during preclinical development.

A S1P1 receptor agonist which was developed by Receptos and acquired by Celgene in a $7.2 billion acquisition.

Ozanimod is approved for use in RRMS and is currently being tested for UC and CD.

• Upadacitinib:

A JAK1 kinase inhibitor developed by AbbVie which delivered promising clinical Phase 2 data in patients with UC.

In February of 2019, AbbVie initiated a Phase 3 study and is currently actively recruiting patients.

As was the case with filgotinib, upadacitinib has also demonstrated reactivation of viruses such as herpes zoster in clinical trials.

Further relevant immuno-modulators are in late-stage development for UC and CD.

These include S1P targeting drugs and JAK/TYK2 inhibitors.

Immunic is not aware of other DHODH inhibitors currently in development for IBD.

Immunic believes that the only approved DHODH inhibitor, Aubagio ® , and its predecessor molecule Arava ® , are unlikely to be successful for IBD due to its side effect profile, which includes diarrhea.

sphingosine-1-phosphate (“S1P”) agonists, or Janus kinase (“JAK”) inhibitors.

Some of these drug candidates have been or may be approved by regulatory authorities for commercial use before vidofludimus calcium may receive approval.

However, depending on the results of future clinical trials, we believes that vidofludimus calcium has the potential to demonstrate medically important advantages compared with other treatments, particularly for long-term therapy in UC patients, due to the selectivity of DHODH targeting of metabolically activated lymphocytes, the absence of general detrimental effects on bone marrow and the immune system, its safety and tolerability profile and the direct antiviral activity.

Since UC patients ultimately fail to respond to treatments, cease to respond to their treatments or develop unacceptable side effects, there is a need for safe and effective treatments for UC with novel mechanisms.

Additionally, patients often prefer the convenience of oral treatments over injections.

Vidofludimus calcium is being developed to be a new treatment option for patients with moderate to severe UC who are candidates for therapy escalation.

As a potentially highly selective, first-in-class oral therapy, vidofludimus calcium has the potential to become a new standard of care in the treatment armamentarium for patients with moderate to severe UC.

This potential is supported by the following properties of vidofludimus calcium:

• Targeted effect on hyperactive immune cells without suppression of normal immune function.

• First-in-class mode of action targeting relevant immune cell populations not currently addressed by existing therapeutic options, particularly in patients who are not sufficiently responsive to available therapies.

• Potential best-in-class safety and tolerability profile, as has been observed to date across the full scope of clinical trials for vidofludimus calcium.

• Potential for combination treatment with established biologics through synergistic effects.

• Increased flexibility for dosing and administration outside of infusion centers.

• Long-term treatment potential with small molecule approach, avoiding the decreasing responsiveness shown with existing antibody treatments as a result of anti-drug antibody development.

• Antiviral effects that potentially avoid virus reactivations which is known to be connected to several currently approved medications in UC.

Clinical Development Plan and Ongoing/Planned Clinical Studies

Immunic has prepared a clinical development plan for IBD, including UC, in collaboration with a group of well-known and experienced physicians from North America and Europe.

Immunic also sought regulatory advice on its development program from the U.S.

Food and Drug Administration (“FDA”), and the Bundesinstitut für Arzneimittel und Medizinprodukte (“BfArM”), before commencing its development program.

Phase 2 Trial of IMU-838 in UC (CALDOSE-1 Trial)

The CALDOSE-1 trial is a Phase 2b, dose-finding, multicenter, double-blind, placebo-controlled study including a blinded induction and maintenance phase, with double randomization (initial randomization for induction and second randomization for maintenance).

The study also includes an option for an open-label treatment extension for patients discontinuing from or completing blinded treatment.

The primary endpoint of the study consists of a patient-reported outcome and an endoscopy-assessed outcome, both to be evaluated following ten weeks of induction treatment comparing IMU-838 to placebo.

Immunic has an active Investigational New Drug (“IND”) application for IMU-838 in UC with the FDA.

Further information regarding Immunic’s UC study can be found on ClinicalTrials.gov under the identifier NCT03341962.

CALDOSE-1 is being conducted in more than 100 study centers throughout 14 countries, including the United States and countries in Western, Central and Eastern Europe.

Before commencing clinical development in IBD, including UC, we had developed a clinical development plan in collaboration with a group of well-known and experienced physicians from North America and Europe, and had received formal regulatory advice for our Phase 2 development program from the FDA.

Phase 2 Trial of Vidofludimus Calcium in UC (CALDOSE-1 Trial)

The CALDOSE-1 trial of vidofludimus calcium in moderate to severe UC is a Phase 2b, dose-finding, multicenter, double-blind, placebo-controlled study including a blinded induction and maintenance phase, with double randomization (initial randomization for induction and second randomization for maintenance).

The trial also includes an option for an open-label treatment extension for patients discontinuing from or completing blinded treatment.

The primary endpoint comprises a composite of patient-reported outcome and endoscopy-assessed outcome, both evaluated following ten weeks of induction treatment with vidofludimus calcium or placebo.

We have an active IND application for vidofludimus calcium in UC with the FDA.

CALDOSE-1 is being conducted at more than 100 sites in 19 countries, including the United States and Western, Central and Eastern Europe.

Enrollment in the study includes a central, blinded and independent assessment of endoscopy at screening to confirm patient eligibility.

Immunic believes that it has taken prudent steps to ensure that the study is conducted in a manner that is consistent with the study protocol in all countries in which the study is being conducted, even though such countries have varying healthcare systems and practices.

A total of approximately 240 patients are planned to be randomized in CALDOSE-1.

The first patient was enrolled in April 2018.

Although the recruitment of this trial has continued during the COVID-19 pandemic, the pandemic has affected, among other things, access to endoscopy sites or hospitals in some countries, which has interfered with recruitment speed, new site activations and clinical site access.

As a result, recruitment is expected to be completed in the second half of 2021 and top-line data of the induction phase is expected to be available in the first half of 2022, as previously announced.

Under an agreement between Immunic and the FDA, reached during the company’s pre-IND meeting in 2017, the UC Phase 2b trial was designed to begin enrollment with three active dosing arms of 10 mg, 30 mg and 45 mg, respectively, in addition to a placebo arm.

At the end of August 2019, an interim dosing analysis was performed by an unblinded and

independent data review committee, which has concluded that the lowest dose of 10 mg appeared not to be likely ineffective, the highest dose of 45 mg was not intolerable, and no safety signal was identified for any of the trial’s three doses of IMU-838.

The data review committee has not shared with the company any of the unblinded data underlying these conclusions, and the study remains blinded to the company, the investigators and the enrolled patients.

We believe that it has taken prudent steps to ensure that the study is conducted in a manner that is consistent with the study protocol in all countries in which the study is being conducted, even though such countries have varying healthcare systems and practices.

This includes an endoscopy-based patient eligibility assessment by a central independent reader and a multiple read and potential adjudication process for week 10 endoscopy when the primary study endpoint is assessed.

On October 28, 2021, we announced that the final patient has been enrolled and randomized in the CALDOSE-1 trial.

At the completion of patient recruitment, the trial has randomized a total of 263 patients into four arms:

three active dosing arms of 10 mg, 30 mg and 45 mg, as well as placebo.

Top-line data for the induction phase are expected to be available in June of 2022.

Under an agreement between us and the FDA, reached during our pre-IND meeting in 2017, the UC Phase 2b trial was designed to begin enrollment with three active dosing arms of 10 mg, 30 mg and 45 mg, respectively, in addition to a placebo arm.

At the end of August 2019, an interim dosing analysis was performed by an unblinded and independent data review committee, which has concluded that the lowest dose of 10 mg appeared not to be likely ineffective, the highest dose of 45 mg was not intolerable, and no safety signal was identified for any of the trial’s three doses of vidofludimus calcium.

The data review committee has not shared with us any of the unblinded data underlying these conclusions, and the study remains blinded to us, the investigators and the enrolled patients.

The interim dosing analysis was not designed to be a futility analysis nor was the primary endpoint or any other endpoint of the study tested statistically.

As a result of these findings, the trial’s steering committee has recommended continuation of all three dosing arms, which recommendation was implemented by Immunic.

Expansion of IMU-838’s potentially effective dose range required continuation of all three dose groups and increased the overall number of patients expected to be included in the ongoing trial from a previously anticipated 195 patients, to a total of approximately 240 anticipated patients.

As a result of these findings, the trial’s steering committee has recommended continuation of all three dosing arms, which recommendation was implemented by us.

Expansion of vidofludimus calcium’s potentially effective dose range required continuation of all three dose groups and increased the overall number of patients expected to be included in the ongoing trial from a previously anticipated 195 patients, to a total of 240 patients.

Further information regarding our CALDOSE-1 trial in UC can be found on ClinicalTrials.gov under the identifier NCT03341962.

Crohn’s Disease

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Distinguishing CD from UC can be challenging when inflammation is confined to the colon.

CD typically involves all layers of the bowel wall, thereby causing complications such as abscesses, strictures and fistulas that regularly require surgical intervention.

CD typically involves all layers of

the bowel wall, thereby causing complications, such as abscesses, strictures and fistulas, that regularly require surgical intervention.

Hallmark clinical symptoms of CD are chronic diarrhea and abdominal pain.

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CD is most commonly diagnosed in late adolescence or early adulthood, but it can manifest at any age.

According to recent data and literature reviews on the incidence of CD (Kappelman 2007;

Burisch 2013;

Understanding Crohn’s Disease, available at https://www.crohnsandcolitis.com/crohns (last accessed July 16, 2019), there are more than 600,000 patients affected by CD in the United States as well as 1.1 million in Europe and more than 125,000 in Canada.

According to DRG (Market Forecast Dashboard, Crohn’s Disease (2020-2030), December 2021), more than 900,000 patients are affected by CD in the United States, and more than 1.7 million in the G7 countries (US, UK, Canada, Japan, Germany, France, Italy).

CD is slightly more prevalent in women than in men.

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There are now some approved treatments, such as alofisel, that target the specific structural complications of CD, including fistulas.

Leflunomide is used off-label in patients with CD and has shown an initial suggestion of the value of DHODH inhibition in this patient population (Holtmann, et al 2008, Prajapati, et al 2003).

Leflunomide is used off-label in patients with CD and has shown an initial suggestion of the possible value of DHODH inhibition in this patient population (Holtmann et al.

2008, Prajapati et al.

In two small investigator trials of leflunomide in CD patients, investigators observed DHODH inhibitor activity in the treatment of moderate to severe CD in patients who have failed or are intolerant to traditional immunomodulator therapy.

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The prescribing information for teriflunomide, leflunomide’s active metabolite, lists a 15-18% rate of diarrhea, which makes it one of the most prevalent side effects of this DHODH inhibitor.

Immunic believes that despite the findings of efficacy for leflunomide in the investigator trials in CD patients, the side effect profile makes it unlikely that this type of DHODH inhibitor can be developed in the indication of IBD, and particularly in CD.

Current Development Plan and Ongoing Studies

Immunic is considering its development strategy for IMU-838 for the treatment of CD.

During the previously noted discussions with the FDA regarding the Company’s UC trial, Immunic and the FDA reached agreement that a clinical trial of IMU-838 in CD could commence when the interim dosing analysis for the Phase 2b CALDOSE-1 trial in UC has been completed.

This would allow Immunic to execute its development of IMU-838 in CD with the remaining active dose groups from CALDOSE-1 and placebo, thereby potentially allowing more efficient recruitment into this trial.

Immunic had also

received additional written advice from the FDA regarding patient-reported outcomes to be used in this trial, called CALDOSE-2.

Given the outcome of the interim dosing analysis of the CALDOSE-1 trial, Immunic is currently re-evaluating the study design in CD and also considering an evaluation of the upcoming CALDOSE-1 results prior to the start of a potential CALDOSE-2 clinical trial.

In addition, Immunic is evaluating the optimal time for efficiently executing such study following the COVID-19 pandemic.

Diagnosis and Prevalence

The World Health Organization (“WHO”) declared SARS-CoV-2 infections causing COVID-19 a pandemic on March 11, 2020.

At present, the total number of cases is difficult to accurately quantify but continues to rise and, according to Johns Hopkins University & Medicine (2020), has grown to more than 100,000,000 cases globally.

Main clinical symptoms include fever, cough, myalgia or fatigue, expectoration, and dyspnea, but a range of other symptoms have been connected to COVID-19 as well.

While a majority of patients do not experience severe symptoms, one meta-analysis found that approximately 18 % of cases were severe (Sun et al.

The symptoms of COVID-19 typically appear within 3 to 14 days after initial exposure to SARS-CoV-2.

If any patient develops characteristic symptoms of COVID-19 or was exposed to a person with COVID-19, infection with SARS-CoV-2 leading to COVID-19 has to be considered.

As there are no specific clinical features that can reliably distinguish COVID-19 from other viral respiratory infections, the patient will then need to undergo specific testing for SARS-CoV-2.

Although several testing methods have been developed, polymerase chain reaction testing remains the primary and most reliable COVID-19 diagnostic testing method in the United States and in most developed countries.

Generally, a sample from the nose (nasopharyngeal swab) or throat (throat swab) is taken and then sent to a laboratory for testing.

Current Treatment Options

As of January 2021, at least two vaccines have been authorized and recommended by the FDA for preventing COVID-19:

• Pfizer-BioNTech's COVID-19 vaccine (BNT162b2)

• Moderna’s COVID-19 vaccine (mRNA-1273)

However, many questions still remain open on the efficacy of these and other COVID-19 vaccines.

It will still take a substantial amount of time to produce, distribute and administer the vaccines worldwide and, as a result, to protect a broad basis of the global population.

It is also still unclear if the vaccines will enable a 100% protection;

some vaccinated individuals may still become ill or transmit the virus.

In addition, there are people who do not want to be vaccinated or who cannot be vaccinated, such as those with pre-existing conditions, cancer therapy patients, or individuals undergoing long-term immunosuppressive therapies for autoimmune diseases.

It is also still unclear how long the vaccine protection will last which may have a significant effect on the practicalities and logistics of immunization.

Finally, it is unclear whether SARS-CoV-2 will disappear completely or whether genetic changes to the virus may occur in the future which could have an impact on the efficacy of available vaccines.

On February 7, 2021, the government of South Africa halted rollout of AZD1222 vaccine given that the protection in patients with an emerging mutant form B.1.351 was found not to prevent mild or moderate cases of COVID-19.

Current approaches to COVID-19 therapies generally fall into two categories:

antivirals, which prevent the virus from multiplying, and immune modulators, which help the immune system to fight the virus or stop it from overreacting dangerously.

Some potential therapies act in a different way or via multiple mechanisms.

In May 2020, the FDA issued an Emergency Use Authorization (“EUA”) for emergency use of remdesivir (Veklury ® ) for the treatment of hospitalized patients with severe COVID-19.

Remdesivir is a direct acting antiviral drug that inhibits viral RNA synthesis.

On November 20, 2020, the WHO issued a conditional recommendation against the use of remdesivir in hospitalized COVID-19 patients, regardless of disease severity, as there is currently no evidence that remdesivir improves survival and other outcomes in these patients.

In November 2020, Eli Lilly's neutralizing antibody bamlanivimab (LY-CoV555) received EUA from the FDA for the treatment of recently diagnosed COVID-19 patients.

Bamlanivimab is authorized for the treatment of recently diagnosed, mild

to moderate COVID-19 in high-risk patients.

However, the ACTIV-3 trial, which is evaluating multiple investigational agents in hospitalized patients with COVID-19, stopped randomizing patients to treatment with LY-CoV555 based on an analysis suggesting that the antibody was not beneficial in this population.

Although numerous pharmacological interventions have obtained an EUA and several are still under clinical investigation, clear efficacy has not yet been determined for any of the COVID-19 drugs.

Each of Pfizer/BioNTech and Moderna have estimated that they will be able to produce up to 1 billion does of their respective vaccines in 2021.

However, many millions of people at high risk of the disease will not be immunized any time soon, necessitating the continued research and development of efficacious drug therapies.

Although the first clinical trials for COVID-19 therapies started in early 2020, only about 7% of the trials testing therapies for the disease have read out so far, according to the BioCentury COVID-19 Resource Center.

Of the over 1,300 ongoing trials, 37% are due to complete by the end of the first half of 2021.

As of January 2021, there are around 55 classes of therapies currently in clinical trials with immunosuppressants being the class with the highest number of ongoing trials.

Studies have shown that it is vital to combine antiviral therapy with immune suppressants because using molecules that control only cytokine storms may make viral clearance difficult.

A recent publication from scientists in Wuhan, China (Xiong et al.

2020) shows promising activity of DHODH inhibitors against SARS-CoV-2 in in vitro cellular studies.

New DHODH inhibitors (PTC299 and PP001) are currently being tested in addition to established DHODH inhibitors, such as leflunomide and Brequinar.

However, due to unfavorable pharmacokinetic profiles (leflunomide) and toxicity (Brequinar), these drugs are not perceived as suitable acute antiviral treatments.

In addition, although the new DHODH inhibitors seem promising, so far, no animal safety data and no human safety data are available.

Therefore, developing new DHODH inhibitors may take significant time, even if accelerated by support of regulatory authorities.

Regarding IMU-838, currently in phase 2 for COVID-19, more than 800 individuals have been dosed to date and a placebo like safety profile has been observed across the entire IMU-838 development program.

We believe that despite the findings of efficacy for leflunomide in the investigator trials in CD patients, the side effect profile makes it unlikely that this type of DHODH inhibitor can be developed in the indication of IBD, and particularly in CD.

Current Development Plan and Ongoing Studies

On April 21, 2020, Immunic announced that IMU-838 had successfully demonstrated preclinical activity against SARS-CoV-2.

Specifically, IMU-838 was observed to inhibit replication of clinical isolates of SARS-CoV-2 associated with COVID-19.

In cellular assays, IMU-838 demonstrated this antiviral activity at concentrations which are well below the blood concentrations associated with IMU-838 dosing regimens studied in ongoing and previous clinical trials.

These positive, broad in vitro antiviral results of IMU-838 had encouraged the Company to start a clinical Phase 2 trial to explore IMU-838 as a potential treatment option for hospitalized patients with moderate COVID-19.

Phase 2 Trial of IMU-838 in Moderate COVID-19 (CALVID-1 Trial)

On June 15, 2020, Immunic announced the first patients had been dosed in its Phase 2, CALVID-1 clinical trial of IMU-838 in COVID-19.

This was a prospective, multicenter, randomized, placebo-controlled, double-blind clinical trial in hospitalized patients with moderate COVID-19, designed to evaluate efficacy, safety and tolerability of IMU-838.

CALVID-1 received regulatory allowance from the BfArM, from the FDA and from regulatory authorities in other European countries involved in the study.

The trial was conducted under an IND application accepted by the FDA using a single global protocol with clinical sites in the United States, Germany and a range of other European countries.

On November 2, 2020, Immunic announced that the enrollment goal of 200 patients was reached, pre-specified in the protocol as sufficient to perform the main efficacy analysis of the Phase 2 part of the CALVID-1 trial.

Enrollment benefited from country selection for this trial, which included additional countries outside of the United States and Western Europe with a less competitive trial environment but increasing infection numbers in fall 2020.

Immunic believes that this country selection strongly contributed to the ability to timely execute the recruitment of this trial.

Further information regarding the COVID-19 study can be found on ClinicalTrials.gov under the identifier NCT04379271.

The aim of the CALVID-1 trial was to investigate IMU-838 as an oral treatment option for COVID-19 and to support

potential use of IMU-838 as a treatment for current and potential future viral pandemic threats.

The prospective, multicenter,

randomized, placebo-controlled, double-blind Phase 2 trial was designed to evaluate efficacy, safety and tolerability of

IMU-838 in patients with moderate COVID-19.

Patients were enrolled at 20 sites in eleven countries, including the United

States, Germany, and a range of other European countries.

Patients were randomized to receive either 22.5 mg of IMU-838

twice daily (45 mg/day), or placebo twice daily, for 14 consecutive days.

Patients in both arms were also eligible to receive

investigator’s choice of standard-of-care therapy throughout the duration of the study.

Inclusion criteria called for hospitalized

adult patients with a confirmed SARS-CoV-2 infection fulfilling clinical status category 3 or 4, as assessed with the

nine-category ordinal scale proposed by the World Health Organization (WHO) COVID-19 Therapeutic Trial Synopsis, as well

as certain additional clinical and laboratory criteria.

On February 17, 2021, Immunic announced that IMU-838 has shown evidence of clinical activity in hospitalized patients with moderate COVID-19.

This planned main analysis of the Company’s Phase 2 CALVID-1 trial was based on data from 204 randomized patients and included top-line clinical efficacy, safety, disease marker, and virology data.

Although no formal statistical analysis was pre-specified for this main analysis, endpoints were analyzed descriptively.

The primary endpoint of the randomized, placebo-controlled, double-blind trial was defined as the proportion of patients without any need for invasive ventilation through day 28.

In contrast to the relatively high rates of ventilation reported in the first COVID-19 wave in early 2020, the CALVID-1 trial found an actual rate of less than 1% of invasive ventilation for hospitalized patients with moderate COVID-19.

This very low event rate, consistent with the findings of many recent third-party trials in COVID-19, prevented the primary endpoint from being evaluable.

Regarding the key secondary endpoints, the trial was designed to investigate IMU-838's ability to reduce the probability of major complications for COVID-19 patients, such as 28-day mortality, survival without respiratory failure, and probability of use of intensive care unit ("ICU") treatment.

Similar to the low ventilation rates discussed above, the trial found a rate of less than 2% for 28-day mortality, balanced between the two arms, and less than 4.5% of patients required an ICU stay.

Based on the very low complication rates in this trial and due to the known variability of the disease course, Immunic believes that the evaluation of these key secondary endpoints is also not feasible.

Despite the low mortality and invasive ventilation rates observed in this trial, clinical activity of IMU-838 was confirmed based on the assessment of multiple secondary clinical endpoints, including clinically meaningful improvements in time to clinical recovery and time to clinical improvement.

In addition, high-risk patients and patients aged over 65 years experienced a more substantial treatment effect of IMU-838.

An anti-viral effect of IMU-838 on SARS-CoV-2 was observed by viral titers at the end of the treatment period (day 14) and at the end of the study (day 28).

A robust anti-inflammatory effect was also observed, based on a more effective reduction of CRP in IMU-838 treated patients, as compared to placebo.

A more effective reduction of D-dimer, a well-known prognostic disease marker for COVID-19, was observed in IMU-838 treated patients, as compared to placebo.

Initial data from a post hoc analysis of “Long COVID” symptoms, the frequently remaining symptoms of COVID-19 after elimination of the virus, indicated that IMU-838 may have the potential to contribute to the prevention of long-term fatigue.

IMU-838 was found to be safe and well-tolerated in hospitalized patients with moderate COVID-19.

No general safety signals regarding new or more severe adverse events were observed for IMU-838 in this patient population, as compared to placebo.

In addition, IMU-838’s rate of serious adverse events and adverse events leading to treatment discontinuation was not increased, as compared to placebo.

The trial also found fewer COVID-19 related adverse events with increased intensity in IMU-838 treated patients (7.1%), as compared to placebo (12.6%) and IMU-838 did not intensify any hematological effects of COVID-19.

In addition, IMU-838 did not increase the rate of infections and infestations as well as the rate of liver events in patients with COVID-19, as compared to placebo.

A total of 204 patients were included in the main analysis of the CALVID-1 trial, as per the protocol requirement of approximately 200 patients.

202 patients received at least one dose of study drug, of whom 99 patients received 45 mg/day of IMU-838 and 103 patients received placebo.

The main analysis contains top-line data for the treatment period until day 14 and the follow-up period until day 28 as well as the full safety data until day 28.

Additional data will be reported after the full analysis of all 223 randomized patients, which is expected to be available in the second quarter of 2021.

This supplemental data set will contain full efficacy, virology, and drug trough level data, as well as the safety follow-up until day 60.

Investigator-Sponsored Clinical Phase 2 Trial of IMU-838 in Combination with Oseltamivir for the Treatment of Patients with Moderate-to-Severe COVID-19 (IONIC Trial)

On July 27, 2020, Immunic announced enrollment of the first patients in an investigator-sponsored clinical Phase 2 IONIC trial of IMU-838 for the treatment of patients with COVID-19.

This trial is run by sponsor and lead site, University Hospitals Coventry and Warwickshire NHS Trust, and is a prospective, randomized, parallel-group, open-label Phase 2b trial, designed to evaluate efficacy and safety of IMU-838 in combination with the neuraminidase inhibitor, Oseltamivir (Tamiflu Ⓡ ), in

approximately 120 adult patients with moderate-to-severe COVID-19.

On February 5, 2021, the investigators informed the Company that 30 patients have been enrolled in the trial, pre-specified in the protocol as sufficient to perform a first interim analysis.

We are considering our development strategy for vidofludimus calcium for the treatment of CD.

During the previously noted discussions with the FDA regarding our UC trial, we and the FDA reached agreement that a clinical trial of vidofludimus calcium in CD could commence when the interim dosing analysis for the Phase 2b CALDOSE-1 trial in UC has been completed.

This would allow us to execute its development of vidofludimus calcium in CD with the remaining active dose groups from CALDOSE-1 and placebo, thereby potentially allowing more efficient recruitment into this trial.

We had also received additional written advice from the FDA regarding patient-reported outcomes to be used in this trial, called CALDOSE-2.

Given the outcome of the interim dosing analysis of the CALDOSE-1 trial, we are currently re-evaluating the trial design in CD and also prefers to evaluate the upcoming CALDOSE-1 results prior to the start of a potential CALDOSE-2 clinical trial.

In addition, we are evaluating the optimal time for efficiently executing such study following the COVID-19 pandemic.

Primary Sclerosing Cholangitis

Immunic is also exploring the use of IMU-838 in orphan diseases that may allow for an accelerated path to commercialization.

Immunic is exploring such orphan diseases in conjunction with interested investigators.

We are also exploring the use of vidofludimus calcium in orphan diseases that may allow for an accelerated path to commercialization.

We are exploring such orphan diseases in conjunction with interested investigators.

Diagnosis and Prevalence

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Current Development Plan and Ongoing Studies

Immunic has entered into a collaboration with investigators at the Mayo Clinic to explore the use of IMU-838 in PSC.

An investigator-sponsored proof-of-concept clinical trial of IMU-838 in PSC, for which Immunic provided the study medication, was conducted at the Mayo Clinic in Arizona and Minnesota, both of which are tertiary referral centers for PSC patients.

We have entered into a collaboration with investigators at the Mayo Clinic to explore the use of vidofludimus calcium in PSC.

An investigator-sponsored proof-of-concept clinical trial of vidofludimus calcium in PSC, for which we provided the study medication, was conducted at the Mayo Clinic in Arizona and Minnesota, both of which are tertiary referral centers for PSC patients.

The study was led by Elizabeth Carey, M.D., Professor of Medicine, Division of Gastroenterology and Hepatology, Department of Internal Medicine, Mayo Clinic, who had received Investigator IND approval from the FDA and had been granted Institutional Review Board ("IRB") approval to conduct the study.

The study was supported by a grant from the National Institutes of Health (“NIH”).

Further information regarding the PSC study can be found on ClinicalTrials.gov under the identifier NCT03722576.

On February 18, 2021, Immunic announced positive top-line data from the study which was designed to investigate IMU-838's potential to improve various biochemical parameters in PSC patients and help determine whether any such activity warrants further investigation randomized PSC trials.

The primary objective of this study was to determine whether IMU-838 reduces serum alkaline phosphatase (“ALP”) in adult patients diagnosed with PSC.

The study planned to enroll 30 patients with PSC, aged 18 to 75 years, who received 30 mg of vidofludimus calcium once daily for a period of 24 weeks.

Enrollment for the study took place between July 2019 and September 2020, but almost all enrollment occurred in 2019 and early 2020.

Together with the investigators, we determined to readout data of the 18 patients who were enrolled prior to the COVID-19 pandemic.

The ongoing pandemic situation also triggered the principal investigator’s decision to terminate the study in late 2020, before the intended recruitment goal of 30 patients was reached.

On February 18, 2021, we announced positive top-line data from the study which was designed to investigate vidofludimus calcium's potential to improve various biochemical parameters in PSC patients and help determine whether any such activity warrants further investigation randomized PSC trials.

18 of the targeted 30 patients were enrolled in the study (intent-to-treat population, “ITT”), of whom only 11 patients completed the full vidofludimus calcium treatment course and were evaluable over the 24-week treatment period (per-protocol population, “PP”).

The primary objective of this study was to determine whether vidofludimus calcium reduces serum alkaline phosphatase (“ALP”) in adult patients diagnosed with PSC.

The main analysis for the primary objective was whether patients could achieve a reduction of ALP at week 24 which is greater or equal to 25%, as compared to baseline, with an AST increase at week 24 of no more than 33%, as compared to baseline.

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Secondary objectives were to investigate the liver biochemistry parameters, AST, ALT, and total/direct/indirect bilirubin, as well as the concentrations of proinflammatory cytokines, as compared to baseline.

The longitudinal analysis of both AST and

ALT as well as total, direct and indirect bilirubin values showed a stable pattern in the PP population with no statistically significant change over time and the confidence interval to include the no-change scenario (AST:

The longitudinal analysis of both AST and ALT as well as total, direct and indirect bilirubin values showed a stable pattern in the PP population with no statistically significant change over time and the confidence interval to include the no-change scenario (AST:

average 30 day change 1.22 IU/L, 95% CI:

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In addition, a decrease in the Ulcerative Colitis Clinical Score was observed in evaluated patients, although the number of assessed patients was limited.

The study also found that IMU-838 is a safe and well-tolerated oral drug for PSC patients and treatment-emergent adverse events were rare and generally mild.

The study, for which Immunic provided the study medication, planned to enroll 30 patients with PSC, aged 18 to 75 years, who received 30 mg of IMU-838 once daily for a period of 24 weeks.

Enrollment for the study took place between July 2019 and September 2020, but almost all enrollment occurred in 2019 and early 2020.

Together with the investigators, Immunic determined to readout data of the 18 patients who were enrolled prior to the COVID-19 pandemic.

The ongoing pandemic situation also triggered the principal investigator’s decision to terminate the study in late 2020, before the intended recruitment goal of 30 patients was reached.

Registration Plan

All of Immunic’s drug development candidates require approval from the FDA and corresponding agencies in other countries before they can be marketed for sale.

The study also found that vidofludimus calcium is a safe and well-tolerated oral drug for PSC patients and treatment-emergent adverse events were rare and generally mild.

Further information regarding the PSC study can be found on ClinicalTrials.gov under the identifier NCT03722576.

This Phase 1 trial has started in September 2021 and is expected to run approximately six months.

Diagnosis and Prevalence

The World Health Organization (“WHO”) declared SARS-CoV-2 infections causing COVID-19 a pandemic on March 11, 2020.

Main clinical symptoms include fever, cough, myalgia or fatigue, expectoration, and dyspnea, but a range of other symptoms have been connected to COVID-19 as well.

The symptoms of COVID-19 typically appear within 3 to 14 days after initial exposure to SARS-CoV-2.

If any patient develops characteristic symptoms of COVID-19 or was exposed to a person with COVID-19, infection with SARS-CoV-2 leading to COVID-19 has to be considered.

As there are no specific clinical features that can reliably distinguish COVID-19 from other viral respiratory infections, the patient will then need to undergo specific testing for SARS-CoV-2.

Generally, a sample from the nose (nasopharyngeal swab) or throat (throat swab) is taken and then sent to a laboratory for testing.

Current Treatment Options

As of January 2022, at least three vaccines have been authorized and recommended by the FDA for preventing COVID-19:

• Pfizer-BioNTech's COVID-19 vaccine (Comirnaty ® , BNT162b2)

• Moderna’s COVID-19 vaccine (Spikevax ® , mRNA-1273)

• Janssen’s COVID-19 vaccine (JNJ-78436735)

Current approaches to COVID-19 therapies generally fall into two categories:

antivirals, which prevent the virus from multiplying, and immune modulators, which help the immune system to fight the virus or stop it from overreacting dangerously.

Some potential therapies act in a different way or via multiple mechanisms.

In May 2020, the FDA issued an Emergency Use Authorization (“EUA”) for emergency use of remdesivir (Veklury ® ) for the treatment of hospitalized patients with severe COVID-19.

Remdesivir is a direct acting antiviral drug that inhibits viral RNA synthesis.

In December 2021, the FDA issued an EUA for Pfizer’s Paxlovid ® (nirmatrelvir tablets and ritonavir tablets, co-packaged for oral use) for the treatment of mild to moderate COVID-19 in adults and pediatric patients (12 years of age and older weighing at least 40 kilograms or about 88 pounds) with positive results of direct SARS-CoV-2 testing, and who are at high risk for progression to severe COVID-19, including hospitalization or death.

In addition, the FDA has issued initial EUAs for several monoclonal antibodies for the treatment and, partially, prevention of COVID-19 in adult and pediatric patients.

Monoclonal antibodies are laboratory-made molecules acting as substitute antibodies.

The immune system can recognize and respond more effectively to the COVID-19 infection, making it more difficult for the virus to reproduce and cause harm.

Some EUAs were revised or revoked later based on updated data when those became available.

Current Development Plan and Ongoing Studies

A publication from scientists in Wuhan, China (Xiong et al.

2020) had shown promising activity of DHODH inhibitors against SARS-CoV-2 in in vitro cellular studies.

On April 21, 2020, we announced that vidofludimus calcium had successfully demonstrated preclinical activity against SARS-CoV-2.

Specifically, vidofludimus calcium was observed to inhibit

replication of clinical isolates of SARS-CoV-2 associated with COVID-19.

In cellular assays, vidofludimus calcium demonstrated this antiviral activity at concentrations which are well below the blood concentrations associated with vidofludimus calcium dosing regimens studied in ongoing and previous clinical trials.

Phase 2 Trial of Vidofludimus Calcium in Moderate COVID-19 (CALVID-1 Trial)

The CALVID-1 trial was a prospective, multicenter, randomized, placebo-controlled, double-blind clinical trial in hospitalized patients with moderate COVID-19, designed to evaluate efficacy, safety and tolerability of vidofludimus calcium.

The aim of the CALVID-1 trial was to investigate vidofludimus calcium as an oral treatment option for COVID-19 and to support potential use of vidofludimus calcium as a treatment for current and potential future viral pandemic threats.

Patients were enrolled at 20 sites in eleven countries, including the United States, Germany, and a range of other European countries.

Patients were randomized to receive either 22.5 mg of vidofludimus calcium twice daily (45 mg/day), or placebo twice daily, for 14 consecutive days.

Patients in both arms were also eligible to receive investigator’s choice of standard-of-care therapy throughout the duration of the study.

Inclusion criteria called for hospitalized adult patients with a confirmed SARS-CoV-2 infection fulfilling clinical status category 3 or 4, as assessed with the nine-category ordinal scale proposed by the World Health Organization (WHO) COVID-19 Therapeutic Trial Synopsis, as well as certain additional clinical and laboratory criteria.

On February 17, 2021, we announced that vidofludimus calcium has shown evidence of clinical activity in hospitalized patients with moderate COVID-19.

This planned main analysis of the CALVID-1 trial was based on data from 204 randomized patients and included top-line clinical efficacy, safety, disease marker, and virology data.

Although the trial found very low rates of serious complications (e.g., mortality, rate of intensive care unit submissions and rate of invasive ventilations) in the population of hospitalized patients with moderate COVID-19, the data did show clinical activity of vidofludimus calcium based on multiple secondary endpoints, including clinically meaningful improvements in time to clinical recovery, time to clinical improvement, and disease markers.

In addition, high-risk patients and patients over 65 years of age experienced a more substantial treatment effect of vidofludimus calcium.

Vidofludimus calcium also prevented many COVID-19-related adverse events of higher severity.

Finally, vidofludimus calcium was found to be safe and well-tolerated in this patient population.

The full analysis of all 223 randomized patients supports the conclusions made for the main analysis.

However, the full analysis also provided data on a few additional endpoints that were not assessed in the main analysis.

The rate and timing of anti-SARS-CoV-2 antibodies patients are developing in response to the infection was found to be identical between the vidofludimus calcium and placebo treatment arms.

We believe that this is an important confirmation of the mechanism of action of vidofludimus calcium that selectively targets highly metabolically activated cells involved in the disease process, but leaves antibody production relatively unaffected.

Although no specific data are available at this point, we also believe that these data may support that vaccinations, including those for SARS-CoV-2, may be effectively given during vidofludimus calcium therapy.

Many immunomodulatory therapies are known to interfere with vaccinations, however several studies with another DHODH inhibitor (teriflunomide) had shown that this is not the case for these class of drugs.

The CALVID-1 SARS-CoV-2 antibody data are supportive of this finding as well.

The full analysis was also able to detect a relationship between drug trough levels in blood plasma and the clinical recovery endpoint.

Higher drug levels correlate with shorter clinical recovery periods.

We believe that this is another important finding to provide evidence of clinical activity in moderate COVID-19 patients.

Further information regarding our CALVID-1 trial in COVID-19 can be found on ClinicalTrials.gov under the identifier NCT04379271.

The CALVID-1 trial was able to highlight important differentiators of vidofludimus calcium as compared to existing medications in MS and UC.

Many other immunomodulatory drugs commercially used provide a beneficial effect on the disease but are also known to have a higher rate of virus reactivations as adverse drug reactions.

For example, some drugs used in ulcerative colitis are known for elevated rates of zoster virus reactivation (shingles).

Drugs approved for multiple sclerosis have shown the rare but clinically very important side effect of PML which is highly lethal and caused by a virus reactivation and infection of the brain tissue.

vidofludimus calcium has not shown an increased rate of infections and infestations, as compared to placebo, in the CALVID-1 trial.

The same finding was already observed in other controlled clinical trials of vidofludimus calcium, including the Phase 2 EMPhASIS trial in RRMS.

We believe that both the underlying selectivity of DHODH inhibition on the immune system and the broad antiviral properties of vidofludimus calcium contribute to these findings.

The results of the CALVID-1 trial also corroborate the broad antiviral activity of vidofludimus calcium, already known from previous in vitro testing in a range of different virus families.

We believe that these results support the ability of a host-cell directed antiviral mechanism of vidofludimus calcium to provide antiviral activities largely independent of mutational variants.

We will continue to explore the broad antiviral properties of vidofludimus calcium, including testing its combination

potential with other drugs in further in vitro and in vivo preclinical studies.

In other clinically important virus diseases, such as hepatitis or AIDS, combination treatments are already the mainstay of therapy, whereas monotherapy was found to be inferior to such combinations.

This additional research will enable us to explore the potential of vidofludimus calcium to target preparedness for potential future pandemics and for clinically important and underserved viral diseases.

Investigator-Sponsored Phase 2 Trial of Vidofludimus Calcium in Combination with Oseltamivir in Moderate to Severe COVID-19 (IONIC Trial)

On July 27, 2020, we announced enrollment of the first patients in an investigator-sponsored Phase 2 trial of vidofludimus calcium for the treatment of patients with moderate to severe COVID-19.

This trial is run by sponsor and lead site, University Hospitals Coventry and Warwickshire NHS Trust, London, United Kingdom, and is a prospective, randomized, parallel-group, open-label Phase 2b trial, designed to evaluate efficacy and safety of vidofludimus calcium in combination with the neuraminidase inhibitor, Oseltamivir (Tamiflu Ⓡ ), in approximately 120 adult patients with moderate to severe COVID-19.

An interim analysis of approx.

30 patients provided evidence for potential activity of the combination treatment of oseltamivir and vidofludimus calcium and the trial is currently being expanded to include additional sites.

Further information regarding the IONIC trial in COVID-19 can be found on ClinicalTrials.gov under the identifier NCT04516915.

Vidofludimus Calcium Registration Plan

All of our drug development candidates require approval from the FDA and corresponding agencies in other countries before they can be marketed for sale.

The activities required before drugs or biologics may be marketed in the United States include:

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Future human clinical testing and marketing outside the United States will be subject to foreign regulatory requirements.

These requirements vary by jurisdiction, differ from those in the United States and may require Immunic to perform additional preclinical or clinical testing regardless of whether FDA approval has been obtained.

These requirements vary by jurisdiction, differ from those in the United States and may require us to perform additional preclinical or clinical testing regardless of whether FDA approval has been obtained.

The amount of time required to obtain necessary approvals from foreign regulatory agencies may be longer or shorter than that required for FDA approval.

In many countries outside of the United States, coverage, pricing and reimbursement approvals are also required.

Immunic announced positive top-line data from its Phase 2 EMPhASIS trial of IMU-838 in patients with RRMS on August 2, 2020 and expects to have end-of-Phase 2 discussions with regulatory agencies in May of 2021 to discuss the necessary aspects of a Phase 3 program.

Immunic also has ongoing Phase 2b trials for IMU-838 in UC and COVID-19, and one investigator-sponsored proof-of-concept clinical trial in PSC.

The Company is also considering whether to conduct another clinical trial in CD.

If any of these studies meet their primary endpoint and demonstrate general safety and efficacy of IMU-838, Immunic intends to conduct pivotal trials to be initiated either by Immunic itself or by Immunic in collaboration with a potential partner.

For our lead indications RRMS and IBD, marketing approval would require completion of two successful, well-controlled Phase 3 studies.

Completing such studies would require substantial financial and resource investments and may take several years to complete.

We have an ongoing Phase 3 program for vidofludimus calcium in RMS, and ongoing Phase 2 trials for vidofludimus calcium in PMS and UC.

We are also considering whether to conduct another clinical trials in CD and PSC.

For our lead indications RMS and IBD, marketing approval would require completion of two successful, well-controlled Phase 3 trials.

Completing such trials would require substantial financial and resource investments and may take several years to complete.

In parallel, additional preclinical and clinical investigations need to be conducted in preparation for filing applications for regulatory approval, including additional pharmacological studies in special populations or drug-drug interaction studies.

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The FDA may grant accelerated approval for drugs that address life-threatening diseases without effective therapies, based on findings from surrogate endpoints reasonably expected to predict clinical outcomes.

Additionally, the FDA may grant orphan status for drugs that address high unmet medical needs in rare diseases.

Additionally, the FDA may grant

orphan status for drugs that address high unmet medical needs in rare diseases.

Accordingly, due to its relatively low prevalence, PSC may have the potential for an accelerated path toward commercial approval.

Based on the rarity of PSC, the life-threatening nature of the disease and the lack of effective therapies, the FDA and other regulatory agencies may agree to an abbreviated development plan, including the possibility of only one single open-label pivotal trial.

However, any such development path needs to be discussed with regulatory agencies once proof-of-concept data in PSC are available for IMU-838.

This approval may require Immunic to study dosing of IMU-838 in a liver impaired patient population.

Manufacturing and Formulation

IMU-838 is provided as a white, uncoated immediate release tablet.

However, any such development path needs to be discussed with and approved by regulatory agencies and we have not yet had any such discussions.

Vidofludimus Calcium Manufacturing and Formulation

Vidofludimus calcium is provided as a white, uncoated immediate release tablet.

Dose strengths for clinical trials are 5 mg, 15 mg, 22.5 mg, 30 mg and 45 mg, compared with placebo.

The tablets are packaged in polyethylene bottles.

Vidofludimus calcium, the active ingredient of IMU-838, has been synthesized in batches up to 250 kg of active pharmaceutical ingredient (“API”) and a drug product batch size of 500,000 tablets has been produced.

The Company has the capacity for batch sizes of up to several million units.

Commercialization Strategy

Immunic’s products are being developed with the aim of delivering proof-of-efficacy in state-of-the-art clinical trials with multiple compounds in multiple indications.

Subsequent pivotal trials may be conducted by Immunic alone or with a potential partner.

A recent unpublished report by the National Multiple Sclerosis Society suggests that the prevalence of MS in the United States is about 1 million.

Even though the prevalence of MS in the United States is potentially higher, Wallin et al.

(2019) state that the number of diagnosed patients remains at about 700,000 patients.

Of the approximately 700,000 patients diagnosed with MS, about 85% are diagnosed with RRMS.

MS symptoms typically appear during young adulthood, peaking around 30 years old.

According to a recent market study, Global Multiple Sclerosis Drugs Market Size, Market Share, Application Analysis, Regional Outlook, Growth Trends, Key Players, Competitive Strategies and Forecasts, 2017 to 2025 .

the global MS market is expected to be worth $27.4 billion by 2025.

The United States holds the largest portion of the global market share for MS treatments, which is expected to continue to grow rapidly due to the increasing incidence of MS, technological advances, and rising drug costs in the United States.

Unmet medical need remains high and is a main driver for new pipeline entrances.

Oral, small molecule therapeutics are seeing the fastest growth in the MS market due to their increased patient convenience.

UC and CD are prevalent in the Western population, and according to recent literature reviews on the incidence of IBD (Kappelman 2007;

Burisch 2013;

Rocchi 2012), almost 4.1 million patients suffer from IBD in the United States, Europe and Canada.

Worldwide, according to GBD 2015 Lancet (2016), around 11.2 million patients are affected by IBD.

In total, the global market for IBD is estimated to be $7.6 billion in 2023, according to Global IBD Market Forecast 2018.

Immunic believes that IMU-838 has the potential to be differentiated from current treatment options as it is being developed to potentially (i) provide a convenient, oral delivery and (ii) avoid viral reactivation.

Intellectual Property, Licenses and Royalties

IMU-838 is covered by several layers of patents and applications, all either granted or filed in the United States, the European Union and other territories.

Initially, IMU-838 is protected by a granted patent claiming the composition of matter of IMU-838’s active moiety, vidofludimus, the free acid form of IMU-838.

Vidofludimus calcium has been synthesized in several batches of approximately 80 kg each of active pharmaceutical ingredient (“API”) and a drug product batch size of 500,000 tablets has been produced by manufacturers under contract with us.

Our existing manufacturers have the capacity for batch sizes of up to several million units.

Vidofludimus Calcium Intellectual Property, Licenses and Royalties

Vidofludimus calcium is covered by several layers of patents and applications, all either granted or filed in the United States, the European Union and other territories.

Initially, vidofludimus calcium is protected by a granted patent claiming the composition of matter of vidofludimus calcium’s active moiety, vidofludimus, the free acid form of vidofludimus calcium.

This patent is granted in most major markets and expires in 2022 in most of these jurisdictions.

Additionally, a second layer of applications was filed to cover IMU-838’s active ingredient, the calcium salt of vidofludimus.

These applications are granted in some jurisdictions and cover IMU-838 until 2031, and U.S.

Additionally, a second layer of applications was filed to cover vidofludimus calcium’s active ingredient, the calcium salt of vidofludimus.

These applications are granted in some jurisdictions and cover vidofludimus calcium until 2031, and U.S.

Patent Term Extension and/or European Supplementary Protection Certificates could provide prolonged protection from generic entry up to 2036, depending on NDA submission time and IND filing in the United States and analogous filings in the European Union.

Another layer consists of patent applications filed in early 2018 and directed to composition of matter of a newly-identified, specific polymorph of IMU-838 and a related method of production of the clinical material for IMU-838, which is now the

active ingredient of the currently used IMU-838 formulation.

In addition, a patent application covering a dosing scheme currently used with IMU-838 was filed in 2017, based on unexpected findings from Phase 1 and preclinical investigations.

If issued, this patent could extend patent protection for IMU-838 to 2038.

IMU-838 and IMU-935 were acquired in a transaction with the originator 4SC in September 2016.

As part of the transaction, 4SC is entitled to receive a royalty on net sales if products originating from these acquisitions achieve market approval.

Immunic has subsequently submitted additional patent applications for independently developed intellectual property relating to each of IMU-838 and IMU-935.

Another layer consists of patent applications filed in early 2018 and directed to composition of matter of a newly-identified, specific polymorph of vidofludimus calcium and a related method of production of the clinical material for vidofludimus calcium, which is now the active ingredient of the currently used vidofludimus calcium formulation.

In addition, a patent application covering a dosing scheme currently used with vidofludimus calcium was filed in 2017, based on unexpected findings from Phase 1 and preclinical investigations.

If issued, this patent could extend patent protection for vidofludimus calcium to 2038.

Vidofludimus calcium and IMU-935 were acquired in a transaction with the originator 4SC in September 2016.

We have subsequently submitted additional patent applications for independently developed intellectual property relating to each of vidofludimus calcium and IMU-935.

On March 31, 2021, our German subsidiary, Immunic AG, and 4SC entered into a Settlement Agreement, pursuant to which Immunic AG settled its remaining obligation of a 4.4% royalty on net sales for $17.25 million.

The payment was made 50% in cash and 50% in shares of our common stock.

IMU-935 – Targeting RORγt and Th17

Mechanism of Action and Key Mechanistic Data

The target RORγ (RORC) has three known main functions:

(i) is a key regulator of Th17 cell differentiation, (ii) is the crucial transcription factor for the genes encoding IL-17A and IL-17F, and (iii) drives normal thymocyte maturation.

Preclinical results confirm that IMU-935 is a highly potent and selective inverse agonist of RORγt with an IC 50 (the concentration of drug that inhibits 50% of the activity of the target) of around 24 nM with additional activity on DHODH (IC 50 of 240 nM).

The resulting effect of IMU-935 in vitro on IL-17A, IL-17F, IFNγ and TNF α cytokine release from stimulated human lymphocytes is in the low single-digit nanomolar range.

The dual target activity of IMU-935 may offer the opportunity to increase the therapeutic window of IMU-935 compared with pure RORC inhibitors.

Furthermore, IMU-935 potently inhibits Th17 differentiation and has demonstrated dose dependent activity in several cellular test systems and in psoriasis/IL-17F and IBD animal models.

IMU-935 is a highly potent and selective inverse agonist of a transcription factor called RORγt.

We believe that the nuclear receptor RORγt is the main driver for the differentiation of Th17 cells and the release of cytokines involved in various inflammatory and autoimmune diseases.

The target RORγt (RORC) has three known main functions in T cells:

(i) it is a key regulator of Th17 cell differentiation, (ii)it is the crucial transcription factor for the genes encoding IL-17A and IL-17F, and (iii) it drives normal thymocyte maturation.

We believe this target is an attractive alternative to approved antibodies for targets, such as IL-23, the IL-17 receptor and IL-17 itself.

Preclinical results confirm that IMU-935 is a highly potent and selective inverse agonist of RORγt with an IC 50 (the concentration of drug that inhibits 50% of the activity of the target) of around 24 nM in reporter assays and 20 nM in a microscale thermophoresis (“MST”) binding assay to the protein.

The resulting effect of RORγt inhibition by IMU-935 in vitro on IL-17A, IL-17F and IFNγ cytokine release from stimulated human lymphocytes is in the low single-digit nanomolar range, showing IC 90 levels of 5-6 nM.

Furthermore, IMU-935 potently inhibits Th17 differentiation and has demonstrated dose dependent activity in several cellular test systems and in vivo in psoriasis/IL-17, graft versus host disease, experimental autoimmune encephalomyelitis (“EAE”)and IBD animal models.

One of the potential risks of drugs targeting RORγt was identified in prior research suggesting that RORγt knockout or inhibition impacts Th17 differentiation, IL-17 transcription and thymocyte maturation to the same extent.

More recent research published in Nature Immunology (2017) suggests that these functions are differentially mediated by small structural changes of the RORγt protein impacting the interaction with co-factors and other proteins.

In preclinical testing, IMU-935 was found to fully maintain the T cell maturation function.

Immunic believes that this may potentially be an important differential feature to other RORγt inhibitors, and may provide a better safety profile, however this needs to be confirmed in future clinical trials .

The preclinical effect of targeting RORγt has been demonstrated in several preclinical experiments of competing RORγt modulators.

Some molecules progressed to clinical stage.

However, to date, only a limited number of products have reached clinical Phase 2 studies.

However, to date, only a limited number of product candidates have reached clinical Phase 2 studies.

Diagnosis and Prevalence

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Topical therapies, such as corticosteroids and vitamin D3 analogues, reduce inflammation, which slows the proliferation of keratinocytes and reduces itching.

Oral therapies such as methotrexate, cyclosporine, apremilast and tofacitinib target anti-inflammatory

Oral therapies, such as methotrexate, cyclosporine, apremilast and tofacitinib, target anti-inflammatory processes.

Biologics block proteins produced by keratinocytes, dendritic cells, Th17 lymphocytes or other immune cells.

Examples of biologics include anti-TNF α biologics such as infliximab, etanercept and adalimumab.

More recently approved monoclonal antibodies, such as secukinumab, ixekizumab and brodalumab, have been developed to target the pro-inflammatory cytokine IL-17.

IL-17 antibodies have largely revolutionized the treatment of patients with moderate to severe psoriasis as they have achieved highly successful skin clearance rates.

Immunic intends to develop IMU-935 as an oral and more convenient treatment option for patients with moderate to severe psoriasis with a mechanism of action and efficacy that approximates those of IL-17 antibodies.

Currently, several RORγt inverse agonists are in preclinical development for the treatment of psoriasis, but only a few are in clinical development.

To Immunic’s knowledge, these are:

• JTE-451 Phase 2 completed (Japan Tobacco)

• AUR-101 in Phase 2 (Aurigene Discovery)

• BI 730357 in Phase 2 (Boehringer Ingelheim)

• ESR-114 Phase 1/2 completed (Escalier Biosciences)

• BOS172767 / ARN-6039 Phase 1 completed (Boston Pharmaceuticals, licensed from Arrien Pharmaceuticals)

• RTA-1701 Phase 1 completed (Reata Pharmaceuticals)

• ABBV-157 in Phase 1 (AbbVie)

• SAR-441169 in Phase 1 (Lead Pharma/Sanofi)

Examples of biologics include anti-TNF α therapies, such as infliximab, etanercept and adalimumab.

Monoclonal antibodies, such as secukinumab, ixekizumab and brodalumab, have been developed to target the pro-inflammatory cytokine IL-17.

Anti-IL-23 agents, such as risankizumab, guselkumab and tildrakizumab, are further treatment options.

Of note, therapies targeting the IL-17/IL-23 axis have largely revolutionized the treatment of patients with moderate to severe psoriasis as they have achieved highly successful skin clearance rates.

We intend to develop IMU-935 as an oral and more convenient treatment option for patients with moderate to severe psoriasis with a mechanism of action and efficacy that approximates those of IL-17 antibodies.

Castration-Resistant Prostate Cancer

Diagnosis and Prevalence

Prostate cancer is the most common malignancy in men (Siegel RL et al., CA CANCER J CLIN 2021;71:7–33).

Castration-resistant prostate cancer (“CRPC”) is defined by disease progression despite androgen depletion therapy and may

present as either a continuous rise in serum prostate-specific antigen (“PSA”) levels, the progression of pre-existing disease, and/or the appearance of new metastases (Saad et al., CAN UROL ASSOC J 2010;4(6):380-4).

Among patients whose prostate cancer is metastatic at the time of diagnosis, bone pain may be the leading symptom.

Bone is the predominant site of disseminated prostate cancer, and pain is the most common manifestation of bone metastases.

Other symptoms with metastatic disease may include hematuria, inability to void, incontinence, erectile dysfunction, weight loss, weakness or pain due to spinal cord compression, pain due to pathologic fractures, fatigue caused by anemia, or symptoms associated with chronic renal failure.

Clinical signs associated with prostate cancer include an elevated PSA on laboratory testing and an abnormal prostate finding on digital rectal examination.

Current Treatment Options and Unmet Need

While docetaxel is still considered a reference chemotherapy for patients with CRPC, cabazitaxel, abiraterone acetate and enzalutamide are commonly prescribed for the majority of patients with CRPC based on the ability to improve overall survival in men who progress after docetaxel.

However, de novo and acquired resistance to these therapies seem to be inevitable, meaning that almost all show disease progression despite treatment with these agents (Chopra S and Rashid P, Aust Fam Physician 2015 May;44(5):302-5).

On July 12, 2021, we presented new preclinical data highlighting IMU-935's therapeutic potential in CRPC.

Recently published third-party studies have shown that RORγ plays an important pro-tumor role by driving expression of the androgen receptor (“AR”), leading to tumor growth.

AR has been shown to be mutated in a constitutively active form called AR-V7 in 18% of untreated patients and up to 95% of patients treated with abiraterone acetate and enzalutamide.

This mutation leads to resistance of AR-axis-targeted therapies and is associated with poor outcomes of progression free survival and overall survival for patients on AR-axis-targeted therapies (Sciarra et al.

In preclinical studies, IMU-935 was observed to inhibit the expression of mutated AR-V7, and the tumor growth of prostate cancer cell lines in vitro .

We believe IMU-935's potency in inhibiting tumorigenesis-promoting IL-17 and Th17 cells in vitro may result in further antitumoral activity in humans.

Guillain-Barré Syndrome

Diagnosis and Prevalence

Historically, GBS was considered a single disease entity.

Historically, Guillain-Barré Syndrome (“GBS”) was considered a single disease entity.

It is now known to be a heterogeneous syndrome with several variant forms.

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Over the past three decades, no other therapies have been found to be effective for GBS.

To Immunic’s knowledge, there are currently no other RORγt inverse agonists in clinical development for the treatment of GBS.

According to ClinicalTrials.gov (last assessed January 18, 2021), the following new treatments are being evaluated in clinical trials:

• ANX005 in Phase 1 (Annexon Biosciences, monoclonal antibody inhibiting complement factor C1q)

• CK0801 in Phase 1 (Cellenkos, allogeneic cord blood derived T-reg cells)

• Imlifidase in Phase 2 (Hansa Biopharma, bacterial endopeptidase cleaving human immunoglobulin)

Clinical Development Plan and Ongoing/Planned Clinical Studies

Immunic believes that IMU-935 is a unique modulator of RORγt, as compared to previous and current competitors.

IMU-935 is an inverse agonist (and not an antagonist) and is unable to completely block RORγt activity, thereby allowing a basal remaining RORγt activity to support normal T cell maturation.

Immunic believes this mechanism of action may avoid unwanted side effects.

In addition, because IMU-935 blocks two separate pathways relevant to the function of Th17 cells (RORγt and DHODH), it was shown in preclinical studies to have single nanomolar activity of inhibition of cytokine release in human peripheral blood mononuclear cells.

Given these properties, Immunic believes that IMU-935 may provide a reasonable therapeutic window between an effective dose and an intolerable dose.

Immunic’s current development plan for IMU-935 focuses on two initial goals:

IMU-935 Clinical Development Plan and Ongoing/Planned Clinical Studies

Our current development plan for IMU-935 focuses on two initial goals:

(i) to rapidly obtain human safety and pharmacokinetic data for IMU-935 in order to evaluate the safety profile of this development candidate, and (ii) to obtain preliminary clinical activity data using safe doses.

Immunic is currently performing early clinical trials with IMU-935, including single and multiple ascending dose trials, through its Australian subsidiary.

We are currently performing a Phase 1 clinical trial with IMU-935 through its Australian subsidiary.

Immunic believes that this development approach allows it to accelerate the program due to certain unique regulatory requirements and processes in Australia.

In the third quarter of 2019, Immunic’s Australian subsidiary received clearance from the Bellberry Human Research Ethics Committee in Australia to begin Phase 1 trials of IMU-935 under the Clinical Trial Notification scheme of the Australian Therapeutic Goods Administration.

The first healthy volunteer in the clinical Phase 1 trial of IMU-935 was dosed in September 2019.

The trial is currently ongoing and recruiting trial subjects.

Several single ascending dose cohorts have successfully been completed.

Data from this ongoing Phase 1 trial of IMU-935 are still blinded, however at this time no safety signals have been identified that would, in the assessment of the safety monitoring group of the trial, preclude from potential evaluation in a first multiple ascending dose cohort.

In February 2021, Immunic received clearance from the Bellberry Human Research Ethics Committee in Australia to commence multiple ascending dose cohorts, which are expected to start in the first quarter of 2021.

Unblinded safety data from the single and multiple ascending dose parts in healthy volunteers is expected to be available in the second half of 2021.

The clinical Phase 1 trial of IMU-935 is comprised of three parts:

In the third quarter of 2019, our Australian subsidiary received clearance from the Bellberry Human Research Ethics Committee in Australia to begin Phase 1 trials of IMU-935 under the Clinical Trial Notification scheme of the Australian Therapeutic Goods Administration.

The Phase 1 clinical trial of IMU-935 is comprised of three parts:

Single Ascending Dose Part

The first part of the Phase 1 trial is a single ascending dose, double-blind, placebo-controlled study of IMU-935 in healthy volunteers.

This part is designed to evaluate the drug’s safety and pharmacokinetic profile and will also include the evaluation of food effects.

The first part of the Phase 1 trial was a single ascending dose, double-blind, placebo-controlled study of IMU-935 in healthy human subjects.

This part was designed to evaluate the drug’s safety and pharmacokinetic profile and also included the evaluation of food effects.

On December 14, 2021, we announced that unblinded data from the single ascending dose part of the ongoing phase 1 clinical trial of a new powder-in-capsule formulation of IMU-935, in which healthy human subjects were treated with 100 mg, 200 mg, 300 mg and 400 mg of this new formulation or placebo, found these single ascending daily doses of IMU-935 to be safe and well-tolerated, and no maximum tolerated dose was reached.

No serious adverse events occurred.

A dose-proportional pharmacokinetic profile was observed across the investigated dose range.

Multiple Ascending Dose Part

Following the single ascending dose part, Immunic plans to initiate a second portion of the Phase 1 trial which will be a multiple ascending dose, double-blind, placebo-controlled study in healthy volunteers with IMU-935 given daily for 14 consecutive days.

This part will assess the safety and pharmacokinetic properties of IMU-935.

Following the single ascending dose part, we initiated a second portion of the Phase 1 trial which was a multiple ascending dose, double-blind, placebo-controlled study in healthy human subjects with IMU-935 given daily for 14 consecutive days.

This part assessed the safety and pharmacokinetic properties of IMU-935.

On December 14, 2021, we also announced unblinded data from the multiple ascending dose part of the ongoing phase 1 clinical trial, in which healthy human subjects were dosed for 14 days with 150 mg either once or twice daily doses of IMU-935 or placebo, found these multiple ascending doses of IMU-935 to be safe and well-tolerated, and no maximum tolerated dose was reached.

No serious adverse events were reported.

No dose-dependent changes in laboratory values (including no effects on liver enzymes or in hematological parameters), vital signs or in electrocardiographic evaluations were found.

Psoriasis Patients

The Company expects to extend these multiple ascending dose studies around mid-2021 by including mild-to-moderate psoriasis patients given IMU-935 daily over 28 consecutive days, in order to assess safety and exploratory disease endpoints in patients with psoriasis.

Potential Phase 2 Trial in GBS

In light of the favorable safety and tolerability data observed in healthy human subjects, we announced on October 27, 2021 that it has initiated part C of the ongoing phase 1 clinical trial, where moderate to severe psoriasis patients are to be randomized to 28-day treatment with IMU-935 or placebo.

Planned assessments include safety, tolerability, pharmacokinetic and pharmacodynamic markers, as well as skin evaluations.

This situation has and may further influence our ability to enroll study participants and/or perform on-site monitoring at clinical sites in those locations.

In light of this, we have already initiated remedial measures, including the potential addition of sites outside of Australia and New Zealand, for the ongoing part C of IMU-935 in psoriasis patients.

Further information regarding our Phase 1 clinical trial can be found on anzctr.org.au under the registration number ACTRN12619001544167.

Phase 1 Clinical Trial of IMU-935 in mCRPC

Based on these strong preclinical results, the Company has initiated an open-label Phase 1 dose-escalation trial designed to evaluate the safety and tolerability of increasing doses of IMU-935 to establish the maximum tolerated dose and the recommended phase 2 dose.

The trial will also evaluate the anti-tumor activity of IMU-935 by means of PSA levels, circulating tumor cell numbers, and radiographic response assessments of tumor progression.

The trial was approved by the Medicines and Healthcare products Regulatory Agency ("MHRA"), the Research Ethics Committee ("REC") and the Health Research Authority ("HRA") in the United Kingdom.

The first patient was enrolled in December 2021.

Initial clinical data are expected to be available in the third quarter of 2022.

Further information regarding Immunic’s Phase 1 clinical trial in mCRPC can be found on ClinicalTrials.gov under the identifier NCT05124795.

Potential Phase 2 Trial of IMU-935 in GBS

Immunic believes that the mechanism of action of IMU-935 may also support its evaluation for the treatment of potential orphan indications.

Upon completion of the single and multiple ascending dose portions of the ongoing Phase 1 trial, Immunic anticipates that it may also begin a Phase 2a proof-of-concept clinical trial of IMU-935 in an orphan autoimmune indication.

Immunic anticipates that it may also begin a Phase 2a proof-of-concept clinical trial of IMU-935 in an orphan autoimmune indication, if the full Phase 1 clinical trial results support such a study.

This orphan approach may allow for an accelerated path to approval, in parallel to IMU-935’s previously planned development in psoriasis.

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The Company plans to announce additional details as soon as design and timing of the envisaged trial are further defined.

Manufacturing and Formulation

IM105935, the API of the IMU-935 drug product, is a small molecule compound and is currently synthesized at up to 20 to 30kg scale.

Single and multiple ascending dose studies are supplied with a spray dried dispersed formulation dosed in gastro-resistant capsules.

However, Immunic may also switch to a potentially updated dosage form, such as tablets, for future usage.

Commercialization Strategy

According to the WHO, psoriasis affects 2-3% of the world’s population and according to the National Psoriasis Foundation over 8 million people in the United States have psoriasis.

GBS occurs worldwide with an overall incidence of 0.16 to 3.0 per 100,000 person-years.

Immunic believes that RORγt is an attractive target in the field of autoimmune diseases since it is the key transcription factor and nuclear receptor for regulation of Th17 cell differentiation and production of the IL-17 family of cytokines.

The imbalance between regulatory T cells and Th17 cells is a hallmark of autoimmune diseases, and by preventing differentiation towards Th17 cells and impairing their function, IMU-935 targets this imbalance in a beneficial manner.

Therefore, Immunic believes that IMU-935 has the potential to provide a safe and cost-effective oral treatment in psoriasis and other autoimmune disorders.

Intellectual Property ("IP"), Licenses and Royalties

Immunic filed a patent application covering composition of matter for IMU-935 and related molecules with the European Patent Office in September 2017, and this application entered the international phase in September 2018.

Assuming this patent issues with sufficient claim coverage, IMU-935 is expected to be under patent protection until 2037, with further extension possible.

IMU-935 Manufacturing and Formulation

IM105935, the API of the IMU-935 drug product, is a small molecule compound and is currently synthesized at up to 30 kg scale.

Clinical trials are supplied with a powder-in-capsule formulation produced by manufacturers under contract with us.

IMU-935 Intellectual Property, Licenses and Royalties

On February 2, 2022 the Company announced that it received a Notice of Allowance from the U.S.

Patent and Trademark Office (“USPTO”) for patent application 16/644581, entitled, “IL-17 and IFN-gamma inhibition for the treatment of autoimmune diseases and chronic inflammation”.

The company also received notice of allowance of patent application EP18762111.5 in Europe, and notice of grant of patent application 2018330633 in Australia.

All three patents cover composition of matter of IMU-935 and related formulations, and are expected to provide protection into at least 2038, without accounting for potential Patent Term Extension (“PTE”) in the United States or Supplementary Protection Certificates (“SPC”) in Europe, respectively.

IP related to IMU-838 and IMU-935 was acquired in a transaction with the originator 4SC in September 2016.

As part of the transaction, 4SC is entitled to receive a royalty on net sales if products originating from these acquisitions achieve market approval.

Immunic has subsequently submitted additional patent applications for independently developed intellectual property relating to each of IMU-838 and IMU-935.

On March 31, 2021, Immunic AG, our German subsidiary, and 4SC entered into a Settlement Agreement, pursuant to which Immunic AG settled its remaining obligation of a 4.4% royalty on net sales for $17.25 million.

The payment was made 50% in cash and 50% in shares of our common stock.

IMU-856 – Targeting Intestinal Barrier Function

Mechanism of Action and Key Mechanistic Data

IMU-856, which Immunic believes to have paradigm-changing potential for multiple diseases, is an orally available, small molecule modulator that targets a protein which serves as a transcriptional regulator of the intestinal barrier function.

IMU-856, which we believe could have a highly advantageous potential for multiple diseases, is an orally available small molecule modulator that targets a protein which serves as a transcriptional regulator of the intestinal barrier function and regeneration of bowel epithelium.

Immunic has not yet disclosed the molecular target for IMU-856.

Based on preclinical data, this compound appears to represent a new and potentially disruptive treatment approach, as the mechanism of action targets the restoration of the intestinal barrier function in patients suffering from diseases like IBD, IBS-D, ICI-induced colitis and other barrier function associated diseases.

Immunic believes that because IMU-856 has not been shown to cause suppression of the immune functions, it should therefore maintain immune surveillance for patients.

Based on preclinical data,

Immunic believes this compound may represent a new treatment approach, as the mechanism of action targets the restoration of the intestinal barrier function and regeneration of bowel epithelium in patients suffering from gastrointestinal diseases such as IBD, IBS-D, celiac disease and other intestinal barrier function associated diseases.

Immunic believes that because IMU-856 has been shown in preclinical investigations to avoid suppression of immune cells, it may therefore maintain immune surveillance for patients during therapy, which would be an important advantage versus chronic treatment with potentially immunosuppressive medications.

Importance of Targeting Bowel Permeability in Multiple Diseases

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This would trigger an initial inflammation event.

It is hypothesized that in IBD patients, the initial inflammatory response is abnormally sustained from lack

of efficient apoptosis of immune cells, but this mechanism is not yet fully understood.

It is hypothesized that in IBD patients, the initial inflammatory response is abnormally sustained from lack of efficient apoptosis of immune cells, but this mechanism is not yet fully understood.

Ultimately, patients develop a chronic and systemic immune response.

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Acute symptoms usually coincide with the acute inflammation that leads to chronic abdominal pain, diarrhea and bloating.

ICIs have been one of the major advances of cancer care in recent years.

ICIs are monoclonal antibodies that inactivate repressors of the anti-cancer immune response.

However, immune-related adverse events affecting various organs, including the GI tract, causing diarrhea and colitis, might occur due to the fact that the immune system becomes less suppressed.

The median time to onset of diarrhea is within the first weeks or months of treatment.

The exact mechanism of these immune-mediated side effects is currently unknown;

however, one hypothesis is that impaired bowel barrier function due to ICI treatment may play a role in this condition.

Celiac disease is an autoimmune and chronic inflammatory condition of the small intestine involving an inappropriate immune response to the gluten-derived protein gliadin in genetically susceptible individuals.

It is characterized by small intestinal epithelial injury, elevated intestinal permeability, and nutrient malabsorption.

The prevalence of celiac disease is 0.5–1% in the general population, with an increasing incidence since the second half of the 20th century.

Celiac disease causes debilitating symptoms and serious medical complications.

Many patients suffer from gastrointestinal symptoms and have abnormal bowel epithelial lining (mucosal atrophy and crypt enlargement).

Small bowel damage often leads to nutrient malabsorption that can result in a range of further clinical manifestations (anemia, osteopenia, failure to thrive in children).

In addition, extra-intestinal symptoms and systemic manifestations are often present, such as dermatitis, infertility, or neurological and skeletal disorders.

Patients with persistent villous atrophy show an increased risk of lymphoproliferative malignancy.

The intestinal epithelia barrier, physiologically impermeable to macromolecules such as gliadin, is recognized to play an important role in the pathogenesis of celiac disease.

Targeting the Disease-Causing and Sustaining Processes

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Clinical Development Plan and Planned Studies

Immunic is performing early clinical trials of IMU-856, including Phase 1 single and multiple ascending dose trials, through its Australian subsidiary.

Immunic is currently performing early clinical trials of IMU-856, including Phase 1 single and multiple ascending dose trials, through its Australian subsidiary.

Immunic believes that this development approach will allow it to accelerate the studies due to certain unique regulatory requirements and processes in Australia.

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In the third quarter of 2020, Immunic’s Australian subsidiary received clearance from the Bellberry Human Research Ethics Committee in Australia to begin Phase 1 trials of IMU-856 under the Clinical Trial Notification scheme of the Australian Therapeutic Goods Administration.

The first healthy volunteer in the clinical Phase 1 trial of IMU-856 was dosed in August 2020.

The trial is currently ongoing and active.

Unblinded safety data from the single and multiple ascending dose parts in healthy volunteers is expected to be available in the second half of 2021.

The clinical Phase 1 trial of IMU-856 is comprised of three parts:

The first healthy volunteer in the Phase 1 clinical trial of IMU-856 was dosed in August 2020.

The trial is currently ongoing and progressing.

Unblinded safety data from the single and multiple ascending dose parts in healthy human subjects is expected to be available in the third quarter of 2022.

The Phase 1 clinical trial of IMU-856 is comprised of three parts:

Single Ascending Dose Part

The first part of the Phase 1 trial is a single ascending dose, double-blind, placebo-controlled study in healthy volunteers with up to five ascending dose levels of IMU-856.

This part is designed to assess safety, pharmacodynamic and pharmacokinetic properties of IMU-856.

The first part of the Phase 1 trial is a single ascending dose, double-blind, placebo-controlled study in healthy human subjects designed to assess safety, pharmacodynamic and pharmacokinetic properties of IMU-856.

One dose level evaluates intra-individual differences between fasted and fed conditions.

All planned single ascending dose cohorts for the current tablet formulation of IMU-856 have been completed but have not yet been unblinded.

Multiple Ascending Dose Part

This part is designed to assess safety, pharmacodynamic and pharmacokinetic properties of IMU-856 and is expected to start in the first quarter of 2021.

Based on the favorable data available so far, the Ethics Committee in Australia has agreed to proceed to the multiple ascending dose part of the Phase 1 trial which is currently being dosed.

This is a multiple ascending dose, double-blind, placebo-controlled study in healthy human subjects with two ascending dose levels of IMU-856 and the study drug given daily for 14 consecutive days.

This part is designed to assess safety, pharmacodynamic and pharmacokinetic properties of IMU-856.

Patients with Conditions Involving Impaired Bowel Barrier Function

The Company plans to extend these single and multiple ascending dose studies in the second half of 2021 to include patients with several diseases involving bowel barrier dysfunction.

The Company plans to extend these single and multiple ascending dose studies in the first half of 2022 to include patients with intestinal barrier function associated diseases.

This would be a double-blind, placebo-controlled study with partial parallel group design.

The study drug would be given daily over 28 consecutive days in patients with several conditions with impaired bowel barrier function that were screened for increased bowel permeability using oral marker tests.

The change in bowel permeability would be evaluated as change from baseline and comparing one or two active dose groups to placebo.

Additionally, biomarkers, disease symptoms, safety and drug trough levels would be assessed.

Immunic expects that this would provide an early indication of pharmacodynamic feasibility of IMU-856 by measuring barrier function surrogate markers in IBS-D, UC and CD patients.

Manufacturing and Formulation

The study drug would be given daily over 28 consecutive days to patients with a model disease which would allow to potentially provide initial evidence of activity of IMU-856.

IMU-856 Manufacturing and Formulation

SPIM-15, the API of the IMU-856 drug product, is a small molecule compound and is currently synthesized at up to 8 kg scale.

It is formulated as an immediate release tablet.

Commercialization Strategy

Immunic believes that IMU-856 has the potential to be part of a new category of GI treatments focusing on normalizing bowel wall barrier function.

The likely focus of product differentiation will be on safe long-term treatment to avoid disease relapse.

Additionally, IMU-856 is designed to target the intestinal barrier function rather than directly targeting immune regulation, which may lead to a different safety profile from current immunomodulatory therapies.

Intellectual Property, Licenses and Royalties

On November 5, 2018, Daiichi Sankyo and Immunic AG entered into an option and license agreement that grants Immunic AG an exclusive global option to exclusively license a group of compounds, designated by Immunic as IMU-856.

Under this agreement, Immunic has the exclusive rights to commercialization of IMU-856 in all countries, including the United States, Europe and Japan.

The option also includes exclusivity on a patent application filed by Daiichi Sankyo in early 2018, covering IMU-856’s composition of matter.

Immunic exercised the option on January 5, 2020.

Concurrent with the option exercise, Immunic paid to Daiichi Sankyo a one-time upfront licensing fee.

Although the IMU-856 tablets are produced in different countries by manufacturers under contract with us, the final release for clinical trials is done by a vendor in Australia

IMU-856 Intellectual Property, Licenses and Royalties

On November 5, 2018, Daiichi Sankyo and Immunic AG, our German subsidiary, entered into an option and license agreement that granted Immunic AG an exclusive global option to exclusively license a group of compounds, designated by us as IMU-856.

Under this agreement, ImmunicAG has the exclusive rights to commercialization of IMU-856 in all countries, including the United States, Europe and Japan.

The license also includes exclusivity on a patent application filed by Daiichi Sankyo in early 2018, covering IMU-856’s composition of matter.

Immunic AG exercised the option on January 5, 2020.

Concurrent with the option exercise, Immunic AG paid to Daiichi Sankyo a one-time upfront licensing fee.

Going forward, Daiichi Sankyo is eligible to receive future development, regulatory and sales milestone payments, as well as royalties related to IMU-856.

Government Regulation

Government Regulation - All Products

In the United States, the FDA regulates drugs under the federal Food, Drug, and Cosmetic Act (“FDCA”), and its implementing regulations.

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• adequate and well-controlled human clinical trials to demonstrate the safety and effectiveness of the drug;

• the submission to the FDA of an NDA for a drug;

• the submission to the FDA of a New Drug Application ("NDA") for a drug;

• satisfactory completion of an FDA inspection of the manufacturing facility or facilities at which the drug is produced to assess compliance with current GMP (“cGMP”), requirements to assure that the facilities, methods and controls are adequate to preserve the drug’s identity, strength, quality and purity;

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Preclinical tests include laboratory evaluations of product chemistry, toxicity and formulation, as well as animal studies.

Preclinical trials must also be conducted in accordance with FDA and comparable foreign authorities’ legal requirements,

regulations or guidelines, including Good Laboratory Practice (“GLP”), an international standard meant to harmonize the conduct and quality of non-clinical studies and the archiving and reporting of findings.

Before human clinical testing can begin, a sponsor must submit the results of the preclinical tests, together with manufacturing information and analytical data, to the FDA as part of the IND, a request for authorization from the FDA to administer an IND product to humans.

Preclinical trials must also be conducted in accordance with FDA and comparable foreign authorities’ legal requirements, regulations or guidelines, including Good Laboratory Practice (“GLP”), an international standard meant to harmonize the conduct and quality of non-clinical studies and the archiving and reporting of findings.

Before human clinical testing can begin, a sponsor must submit the results of the preclinical tests, together with manufacturing information and analytical data, to the FDA as part of the IND, which is a request for authorization from the FDA to administer an IND product candidates to humans in clinical trials.

An IND automatically becomes effective 30 days after receipt by the FDA, unless the FDA, within the 30-day time period, places the clinical trial on a clinical hold.

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Sponsors must also provide all participating investigators and FDA safety reports of any serious and unexpected adverse events and any findings from laboratory tests in animals that suggests a significant risk for human subjects.

For each institution where a clinical trial will be conducted, an IRB must review and approve the clinical trial protocol and informed consent form required to be provided to each trial subject or his or her legal representative prior to a clinical trial commencing, and conduct on-going monitoring of the study until completed or termination to assure that appropriate steps are taken to protect the human subjects participating in the research.

For each institution where a clinical trial will be conducted, an Institutional Review Board ("IRB") must review and approve the clinical trial protocol and informed consent form required to be provided to each trial subject or his or her legal representative prior to a clinical trial commencing, and conduct ongoing monitoring of the study until completed or termination to assure that appropriate steps are taken to protect the human subjects participating in the research.

Human clinical trials are typically conducted in three sequential phases that may overlap or be combined:

In Phase 1 studies, the product candidate is initially introduced into healthy human volunteers and tested for safety, dosage and tolerability, absorption, distribution, metabolism, excretion, and effect on the body.

In Phase 1 studies, the product candidate is initially introduced into healthy human subjects and tested for safety, dosage and tolerability, absorption, distribution, metabolism, excretion, and effect on the body.

Phase 2 studies are conducted in a limited patient population.

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These clinical trials are intended to establish the overall risk-benefit ratio of the product candidate and provide, if appropriate, an adequate basis for product labeling.

Post-approval studies, sometimes referred to as Phase 4 studies, may be conducted after initial marketing approval.

Post-approval studies, sometimes referred to as Phase 4 studies, may be conducted after initial marketing approval from the FDA.

These studies are used to gather additional information about a product’s safety and/or efficacy in patients affected by the therapeutic indication.

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Clinical trials must also be conducted in accordance with legal requirements, regulations or guidelines of the FDA and comparable foreign authorities, including human subject protection requirements and current good clinical practice (“cGCP” or “GCP”).

In addition, clinical trials must be conducted product candidates produced under cGMP requirements.

In addition, clinical trials must be conducted using product candidates produced under cGMP requirements.

The FDA or the sponsor may suspend a clinical trial at any time for various reasons, including a finding that the research subjects or patients are being exposed to an unacceptable health risk.

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The FDA may also inspect clinical trial sites and audit clinical study data to ensure that the sponsor’s studies were properly conducted in accordance with the IND regulations, human subject protection regulations, and cGCP.

Under the current Prescription Drug User Fee Act (“PDUFA”) guidelines, FDA goal for acting on the submission of an NDA for a new molecular entity is ten months from the date of “filing.” The FDA conducts a preliminary review of an NDA within 60 days after submission to determine whether it is sufficiently complete to permit substantive review, before accepting the NDA for filing.

Under the current Prescription Drug User Fee Act (“PDUFA”) guidelines, the FDA goal for acting on the submission of an NDA for a new molecular entity is ten months from the date of “filing.” The FDA conducts a preliminary review of an NDA within 60 days after submission to determine whether it is sufficiently complete to permit substantive review, before accepting the NDA for filing.

This two month preliminary review effectively extends the typical NDA review period to twelve months.

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Research and Development

Immunic recognized $38.6 million and $22.5 million in research and development expenses in the years ended December 31, 2020 and 2019, respectively.

We recognized $61.1 million and $38.6 million in research and development expenses in the years ended December 31, 2021 and 2020, respectively.

Geographic Information

Substantially all of Immunic’s long-lived assets were located within both the United States and Germany in 2020 and 2019.

As of March 1, 2021, Immunic had 28 employees, three of whom held M.D.

Substantially all of our long-lived assets were located within both the United States and Germany in 2021 and 2020.

As of February 18, 2021, we had 55 employees, six of whom held M.D.

Of the employees, 38 were engaged in research and development and 17 in administration.

The Company considers its employee relations to be good.

We consider our employee relations to be good.

Corporate Information and Website

Immunic maintains a website at www.imux.com.

We maintain a website at www.imux.com.

The information contained on, or that can be accessed through, the website is not a part of this Annual Report on Form 10-K.

Immunic’s Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and all amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act are available free of charge through the investor relations page of the internet website as soon as reasonably practicable after the Company electronically files such material with, or furnish it to, the SEC.

Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and all amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act are available free of charge through the investor relations page of our internet website as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business