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Item 1. Business

2023-02-23 compared with 2022-02-24 · 468 added, 548 removed, 311 unchanged (77% of the section changed)

Immunic, Inc.

("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 66 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”).

We are currently pursuing clinical development of three orally administered, small molecule programs, each of which has unique features intended to directly address the unmet needs of patients with serious chronic inflammatory and autoimmune diseases.

These include the vidofludimus calcium (IMU-838) program, which is in Phase 3 clinical development for patients with multiple sclerosis (“MS”);

the izumerogant (proposed International Nonproprietary Name (“INN”) for IMU-935) program, which is an inverse agonist of retinoic acid receptor-related orphan nuclear receptor gamma truncated (“RORγt”) that inhibits the interleukin-17 (“IL-17”) pathway in diseases such as psoriasis;

and the IMU-856 program, which is targeted to restore intestinal barrier function and regenerate bowel epithelium.

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.

Our most advanced drug candidate, vidofludimus calcium (IMU-838), is being tested in several ongoing MS trials as part of its overall clinical program in order to support a potential approval for patients with MS in major markets.

The Phase 3 ENSURE program of vidofludimus calcium in relapsing multiple sclerosis (“RMS”), comprising twin studies evaluating efficacy, safety, and tolerability of vidofludimus calcium versus placebo, and the supportive Phase 2 CALLIPER trial of vidofludimus calcium in progressive multiple sclerosis (“PMS”) are ongoing and actively enrolling patients.

Our current expectation is to report data from the interim analysis of the CALLIPER trial in the second half of 2023 and to read-out top-line data at the end of 2024.

Moreover, we currently expect to report data from the interim analysis of the ENSURE program in late 2024 and to read-out the first of the ENSURE trials end of 2025.

Although we currently believe that each of these goals is achievable, they are each dependent on numerous factors, most of which are not under our direct control and can be difficult to predict.

We plan to periodically review this assessment and provide updates of material changes as appropriate.

If approved, we believe that vidofludimus calcium, with combined anti-inflammatory, anti-viral, and neuroprotective effects, has the potential to be a unique treatment option targeted to the complex pathophysiology of MS.

Multiple publications from 2022 have highlighted the enhanced understanding of the triggers and ongoing neuronal destruction of MS, namely, that MS is triggered by infection from Epstein-Barr virus (“EBV”) followed by cross-reactive antibody production and associated auto-inflammation and neuronal damage.

Vidofludimus calcium is a known inhibitor of the enzyme dihydroorotate dehydrogenase (“DHODH”), which is a key enzyme in the metabolism of overactive immune cells and virus-infected cells.

This mechanism is associated with the anti-inflammatory and anti-viral effects of vidofludimus calcium.

Additionally, recent evidence indicates that vidofludimus calcium activates a yet-to-be-disclosed target with direct neuroprotective properties, which may enhance its potential benefit for patients.

We believe that the combined mechanisms of vidofludimus calcium are unique in the MS space and support the therapeutic performance shown in our Phase 2 EMPhASIS trial in relapsing-remitting multiple sclerosis (“RRMS”) patients, in particular, via data illustrating the potential to reduce magnetic resonance imaging (“MRI”) lesions, prevent relapses, reduce the rate of disability progression, and reduce levels of serum neurofilament light chain (“NfL”), an important biomarker of neuronal death.

Vidofludimus calcium has a consistent pharmacokinetic (“PK”), safety and

tolerability profile and has already been exposed to more than 1,400 human subjects and patients in either of the drug’s formulations.

Our second drug candidate, izumerogant (proposed INN for IMU-935), is a highly potent and selective inverse agonist of a transcription factor called RORγ/RORγt.

The nuclear receptor RORγt is believed to be 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 potential alternative to approaches acting on IL-23, the IL-17 receptor and directly on IL-17.

Preclinical experiments indicated that izumerogant leads to a potent inhibition of Th17 differentiation, inhibition of cytokine secretion, and induction of regulatory T cells.

Importantly, izumerogant did not affect thymocyte maturation, one of the important physiological functions of RORγt 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 izumerogant has potential to be a first-and-best-in-class therapy for various autoimmune diseases.

A Phase 1 clinical trial exploring safety, tolerability, pharmacodynamics (“PD”), PK and exploratory efficacy of izumerogant in moderate-to-severe psoriasis patients is currently ongoing.

A pre-planned group-level interim analysis revealed on October 20, 2022 noted that the initial two active dose cohorts did not separate from placebo at four weeks.

The overall trial is ongoing.

Administration of izumerogant and placebo in this trial were demonstrated to be safe and well-tolerated, and no new safety signals were observed.

We plan to provide further updates and guidance on potential next steps for this development program towards the end of the first quarter of 2023.

Additionally, izumerogant has been shown in preclinical models to target a mutated androgen receptor (“AR”), an established mechanism of treatment resistance to AR therapy, making it a potential treatment option for patients with metastatic castration-resistant prostate cancer (“mCRPC”).

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

Our third program, IMU-856, 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 to the public.

Based on preclinical data, we believe this compound may represent a unique treatment approach, as the mechanism of action targets the restoration of the intestinal barrier function and bowel wall architecture in patients suffering from gastrointestinal diseases such as celiac disease, IBD, irritable bowel syndrome with diarrhea (“IBS-D”) 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, which would be an important advantage versus immunosuppressive medications.

The final portion of a Phase 1 clinical trial exploring the safety and tolerability of IMU-856 in celiac disease patients during periods of gluten-free diet and gluten challenge is currently ongoing, and we expect initial results to be available in mid-2023.

Additional antiviral-directed development activities remain ongoing through preclinical research examining the potential to treat a broad set of viral indications with new antiviral molecules.

We have begun exploring several options to possibly support further development of our antiviral portfolio, including a potential spin-off into a new or existing company and potential licensing transactions.

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.

In addition, we are using our subsidiary in Melbourne, Australia to expedite the early clinical trials for izumerogant 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.

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 failure to obtain needed additional funding on acceptable terms, if at all, to complete the development and commercialization of our three development programs.

We are focused on the development of new 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 more 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 for our product candidates, to date, 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.

• Executing the ongoing Phase 3 ENSURE and Phase 2 CALLIPER clinical trial programs of vidofludimus calcium in MS.

• Executing the ongoing clinical trials of izumerogant 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 trial of IMU-856 in patients with celiac disease.

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

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Liquidity and Financial Condition

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.

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

We have an accumulated deficit of approximately $317.3 million and $196.9 million as of December 31, 2022 and December 31, 2021, respectively.

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.

We expect to incur significant expenses and increasing operating losses for the foreseeable future as we initiate and continue the 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 development programs.

From inception through December 31, 2022, we have raised net cash of approximately $355.5 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.

As of December 31, 2022, the Company had cash and cash equivalents of approximately $106.7 million and investments - other of $9.6 million.

With these funds, we expect to be able to fund our operations beyond twelve months from the date of the issuance of the accompanying condensed consolidated financial statements.

Key Status Updates

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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.

The ongoing ENSURE program comprises two identical multicenter, randomized, double-blind Phase 3 clinical 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 straightforward path towards potential regulatory approval of vidofludimus calcium in RMS.

Each of the identical twin Phase 3 clinical 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 clinical 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.

With regard to the disability

progression endpoint, the ENSURE program will apply a pooled analysis of confirmed disability worsening across both clinical trials.

The ENSURE trials are being 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.

An interim analysis to assess event rates is planned to occur after approximately half of the relapse events 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.

We currently expect to report data from the interim analysis of the ENSURE program in late 2024 and to read-out the first of the ENSURE trials end of 2025.

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

The ongoing multicenter, randomized, double-blind, placebo-controlled Phase 2 CALLIPER trial of vidofludimus calcium 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 (“EDSS”) which may further support disability data from the ENSURE trials.

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.

Our current expectation is to report data from the interim analysis of the CALLIPER trial in the second half of 2023 and to read-out top-line data at the end of 2024.

An interim analysis comprising an unblinded analysis of serum NfL and glial fibrillary acidic protein (“GFAP”) is planned to occur once approximately half of the enrolled patients have completed 24 weeks of treatment.

NfL and GFAP have been shown in third-party research to consistently correlate with disease activity in neurodegenerative disorders and have become two 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.

The 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 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.

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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.

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.

Phase 2 Clinical Trial of Vidofludimus Calcium in RRMS (EMPhASIS Trial) – Open-Label Portion

On November 17, 2022, we reported newly available data from the Phase 2 EMPhASIS trial of vidofludimus calcium in RRMS.

The trial includes an optional long-term open-label extension (“OLE”) phase running up to 9.5 years.

An interim analysis was performed with data extraction in October 2022, when 209 patients remained on treatment in the OLE phase, some of whom have already received more than 180 continuous weeks (approximately four years) of active treatment with vidofludimus calcium.

Long-term open-label treatment with vidofludimus calcium was associated with a low rate of confirmed disability worsening over time, comparing favorably to historical trial data for currently available MS medications.

During the 24-week double-blind main treatment period, 12-week and 24-week Confirmed Disability Worsening (“12w/24wCDW”) events occurred in 1.6% of subjects in the combined vidofludimus calcium treatment arms as compared to 3.7% in the placebo group.

In the OLE phase, the proportion of patients free from 12wCDW was 97.6% after 48 weeks and 94.5% after 96 weeks of vidofludimus calcium treatment as compared to the start of the OLE phase.

Similar results were observed for 24wCDW and sustained CDW.

The OLE phase also showed low relapse activity.

Phase 2 Clinical Trial of Vidofludimus Calcium in Ulcerative Colitis (CALDOSE-1 Trial)

On June 2, 2022, we reported top-line data from our Phase 2 CALDOSE-1 trial of vidofludimus calcium in patients with moderate-to-severe ulcerative colitis (“UC”).

The trial did not achieve the primary endpoint of clinical remission for the pooled 30 and 45 mg/day active dose groups of vidofludimus calcium versus placebo at week 10.

In addition, no meaningful

differences were observed between the three active dose groups for the overall intent-to-treat patient population (10 mg/day:

14.9%, 30 mg/day:

10.6%, 45 mg/day:

13.6%, placebo:

12.5%) or for the trial’s other secondary endpoints, including symptomatic remission, or endoscopic healing.

Consistent with prior data sets in other patient populations, administration of vidofludimus calcium in this clinical trial was observed to be safe and well-tolerated.

No new safety signals were observed.

As compared to placebo, there were no increased rates of infections and infestations, no elevated rates of liver events or liver enzyme elevations, and no elevated rates for changes in hematology-related laboratory variables.

The most common adverse events in this clinical trial were anemia (15/263 patients, 5.7%), headache (9/263 patients, 3.4%) and coronavirus disease 2019 (“COVID-19”) (7/263 patients, 2.7%).

Most adverse events were generally mild in severity.

As is common for the design of clinical trials in UC, the use of oral systemic corticosteroids (≤20 mg/day prednisolone equivalent) was allowed in CALDOSE-1 in patients who had been treated with corticosteroids for at least four weeks before randomization.

Doses of corticosteroids were required to be kept constant throughout the induction phase (weaning was not allowed in this phase of the clinical trial), and the distribution of patients using corticosteroids was equal throughout all treatment groups.

Surprisingly, CALDOSE-1 data suggest a previously unknown treatment interference between the efficacy of vidofludimus calcium and the concurrent use of corticosteroids in the UC patient population.

More specifically, the non-steroid patient population showed an 11.4% advantage in clinical remission for vidofludimus calcium over placebo (pooled vidofludimus calcium treatment groups at week 10:

14.7%, placebo:

Such a difference in clinical remission between active treatment and placebo would traditionally be considered as confirming therapeutic activity.

In contrast, patients concomitantly taking vidofludimus calcium and corticosteroids during induction treatment had a lower rate of clinical remission at week 10 (11.5%) than placebo patients (20.6%) and also lower than the group of vidofludimus calcium monotherapy without concurrent use of steroids (14.7%).

This treatment interference between vidofludimus calcium and corticosteroids was not expected based on our analysis of currently available preclinical or clinical data.

Based on these results, we announced that our development programs in the IBD indications will not be continued without a partner.

Izumerogant (IMU-935)

Phase 1 Clinical Trial of Izumerogant in Moderate-to-Severe Psoriasis Patients

On October 20, 2022, we announced the outcome of a pre-planned interim group-level data analysis of our Phase 1b clinical trial of izumerogant in patients with moderate-to-severe psoriasis.

The pre-planned interim analysis revealed that the group averages for Psoriasis Area and Severity Index ("PASI”) reductions in the two active arms did not separate from placebo at four weeks.

Although the active arms performed in line with expectations, based on similarly designed trials, the trial experienced a greater decrease than expected in PASI in the placebo arm.

Administration of izumerogant and placebo in this trial were demonstrated to be safe and well-tolerated, and no new safety signals were observed.

We plan to provide further updates and guidance on potential next steps for this development program towards the end of the first quarter of 2023.

Following the announcement of our interim group-level data on October 20, 2022, our stock price experienced a significant decline from the prices preceding the announcement and the recent prices raised in our October 10, 2022 Private Placement.

We considered these to be triggering events indicating that it is more likely than not that goodwill is impaired.

As a result, we recorded a full impairment of our goodwill of approximately $33.0 million in the quarter ended December 31, 2022.

Phase 1 Clinical Trial of Izumerogant in mCRPC

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

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.

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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.

The pre-planned dose escalation in the trial with dosing of up to 900 mg daily of izumerogant has been completed.

Initial safety data available, to date, show a promising safety profile, with only benign adverse events and no dose limiting toxicities.

Phase 1 Clinical Trial of IMU-856 in Healthy Human Subjects

On September 20, 2022, we announced positive unblinded safety, tolerability and PK results from Part A (single ascending doses) and Part B (multiple ascending doses) of our Phase 1 clinical trial of IMU-856 in healthy human subjects.

In the single ascending doses part, healthy human subjects were randomized in a double-blinded manner to either placebo or active treatment with single ascending doses of IMU-856 at 10 mg, 20 mg, 40 mg, 80 mg, 120 mg and 160 mg.

Single ascending doses of IMU-856 were found to be safe and well-tolerated and no maximum tolerated dose was reached.

No serious adverse events occurred.

Moreover, a dose-linear PK profile was observed across the investigated dose range.

In the multiple ascending doses part, healthy human subjects were dosed for 14 consecutive days with 40 mg, 80 mg or 160 mg once-daily of IMU-856 or placebo in a double-blinded manner.

Multiple ascending doses of IMU-856 were found to be safe and well-tolerated and no maximum tolerated dose was reached.

Treatment emergent adverse events were mostly mild in severity.

No Investigational Medicinal Product-related serious adverse events were reported.

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

PK analysis showed a quick achievement of stable steady-state plasma concentrations within the first week and stable steady-state trough levels over the 14-day treatment period with a low accumulation factor for IMU-856, allowing predictable trough levels during daily dosing.

PK parameters in steady-state revealed a Tmax (time to reach maximum plasma concentration) of 2 to 3 hours post-dose, a plasma half-life of 17.4 to 21.5 hours and dose proportional increases in Cmax (maximum plasma drug concentration) and AUC (area under the concentration-time curve).

Phase 1 Clinical Trial of IMU-856 in Celiac Disease

On May 5, 2022, we announced the start of the patient cohorts in our ongoing Phase 1 clinical trial of IMU-856 in patients with celiac disease.

Part C is structured as a 28-day, double-blind, placebo-controlled trial designed to assess the safety, tolerability, PK, PD and biomarker responses of IMU-856 in patients with celiac disease during periods of gluten-free diet and gluten challenge.

Approximately 42 patients were planned to be enrolled in two consecutive cohorts with IMU-856 given once-daily over 28 days.

Secondary objectives include PK and disease markers, including those evaluating gastrointestinal architecture and inflammation.

Sites in Australia and New Zealand are participating in Part C.

Initial results are expected to be available in mid-2023.

Product Acquisition History

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.

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

On March 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.

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

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).

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.

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.

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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.

Vidofludimus calcium is a small molecule investigational drug in development as an oral next-generation treatment option for patients with MS 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 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.

Thereby, pro-inflammatory cytokines, such as interferon gamma (“IFNγ”), tumor necrosis factor alpha (“TNFα”), 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 MS and other chronic inflammatory diseases.

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 believe may also play a crucial role in the activity of the drug 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.

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 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.

We previously presented preclinical data demonstrating the activity of vidofludimus calcium to prevent the reactivation of latent EBV infection into lytic infection (Marschall et al., 2021).

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.

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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.

After the consummation of the asset acquisition from 4SC, we 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 PK 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.

We also completed a Phase 1 trial in a total of 24 patients with either no liver function impairment or liver disease of Child-Pugh A Child-Pugh B grade which was designed to explore dose optimization of vidofludimus calcium.

The study showed little influence on the PK of vidofludimus calcium in patients with Child-Pugh A Child-Pugh B liver impairment.

Multiple Sclerosis

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

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.

RRMS is characterized by clearly defined attacks of new or increasing neurologic symptoms.

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

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

RMS is characterized by clearly defined attacks of new or increasing neurologic symptoms.

These relapses are followed by periods of remissions, or partial or complete recovery.

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Diagnosis of MS is confirmed via blood tests and a spinal tap, in which a small sample of fluid is removed from the spinal cord.

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

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).

However, most important for diagnosis are characteristic CNS lesions found using MRI.

According to the National Multiple Sclerosis Society (2019), there are nearly one million patients in the United States living with MS.

The MS International Federation (2021) indicates there are more than one million patients with MS in Europe as well.

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.

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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.

Evolution in Understanding of Disease Drivers of MS

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

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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.

Serum levels of NfL, 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.

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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., 2022).

Schneider-Hohendorf et al.

(2022) investigated the T cell repertoire in MS patients and control populations, basically highlighting the top antigens that are seen by T cells on an ongoing basis.

The study found that EBV-related antigens were on top of the list of antigens seen by T cells in MS patients but not in other EBV-infected populations.

These results suggest that ongoing EBV reactivation seems to be an ongoing trigger for the immune system in MS patients and may be the trigger for disease progression and ongoing neurogenerative processes.

The presence of a “smoldering disease” in the background that leads to progression independent of relapse activity (“PIRA”) was suggested by another large meta-analysis of clinical data in more than 35,000 MS patients (Lublin et al., 2022).

PIRA was traditionally believed to be dominant driver of disease worsening in PMS and this was confirmed by this study as well.

However, the study also found that approximately half of the disability accumulating in RMS patients were not related to relapse activity.

This suggests that PIRA contributes half of the disability to disease progression in RMS in a mechanism other than relapse.

In addition, this investigation found that many currently available drugs were able to delay or avoid disability associated with relapse activity but was unable to diminish the impact of PIRA.

This confirms that PIRA presumably is caused by a process that is not addressed by currently used anti-inflammatory medications remains a high medical need.

Current Treatment Options

There are currently two main treatment types available for RRMS.

There are currently two main approaches to treating RMS.

Some therapies, such as short-term corticosteroid medications, are used for treating relapses of MS symptoms.

Other approaches are used as long-term treatments to reduce the number of relapses and prevent disability progression.

Other approaches are used as long-term treatments to reduce the number of relapses and prevent or slow down disability progression.

The latter are referred to as disease-modifying therapies.

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.

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

The initial treatment options for RMS 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, ublituximab, ofatumumab or alemtuzumab, approved for commercial use in MS in various countries.

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

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Typically, treatments are escalated over time, considering:

• Persistent high MS disease activity under treatment with base medications (relapse(s), disability worsening, MRI lesions),

• Level and progression of MS disease activity (relapse(s), disability worsening, MRI lesions),

• Risks of long-term immunosuppression,

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• Safety/tolerability aspects.

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.

Many drugs approved for patients with RMS work through anti-inflammatory mechanisms by suppressing the immune system, either broadly or by targeting classes of immune cells, altering how the immune system functions and fights certain infections.

leukoencephalopathy ("PML").

To date, occurrences of PML have been reported in individuals with RMS treated with natalizumab, ocrelizumab, 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 RMS.

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 Vidofludimus Calcium in RRMS (EMPhASIS Trial)

Subject to further clinical trials, we believe that could be an important potential differentiator against other drug classes in RMS.

Current Development Plan and Clinical Studies

Depending on the results of our ongoing clinical trials, we believe that vidofludimus calcium has the potential to demonstrate medically important advantages versus other treatments, due to its safety profile and its anti-inflammatory, anti-viral and neuroprotective properties observed-to-date.

Vidofludimus calcium could provide MS patients with a distinctive therapy that is uniquely matched to the biological drivers of MS.

In clinical trials, to date, it has shown data indicating:

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

• Robust MRI lesion suppression by vidofludimus calcium, comparing favorably to other medications commercially available for RMS.

• Improved rates of confirmed disability worsening.

• A robust decrease in serum NfL, a biomarker for axonal damage, providing evidence of vidofludimus calcium’s potential neuroprotective activity.

• A potent interaction with a yet-to-be-disclosed protein target, which is involved in protection of relevant neurons from cell death.

• A very low discontinuation rate for vidofludimus calcium-treated RMS patients, substantially below placebo, which 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, which distinguishes vidofludimus calcium from other oral RMS treatments.

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

Phase 2 Clinical 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.

The Cohort 1 results were subsequently published in the peer reviewed journal, Annals of Clinical and Translational Neurology (Fox et al., 2022).

Cohort 2, which evaluated efficacy and safety of 10 mg once daily vidofludimus calcium compared to placebo, was also published by us.

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 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.

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

In particular, the trial met its primary endpoint, demonstrating a statistically significant reduction in the cumulative number of combined unique active (“CUA”) 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 trial 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, we published the full unblinded clinical data set from our Phase 2 EMPhASIS trial of vidofludimus calcium in patients with RRMS.

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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.

Final data from Cohort 2 showed that the anti-inflammatory effects of vidofludimus calcium at the 10 mg dose were observed to be lower (13% reduction of gadolinium-enhancing MRI 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 provided evidence of dose-proportional neuroprotective activity.

For instance, the highest decrease of the biomarker serum NfL 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 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.

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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.

Additionally, we obtained 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.

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

On November 17, 2022, we reported newly available data from the EMPhASIS trial.

The trial includes an optional long-term OLE phase running up to 9.5 years.

In the OLE phase, the proportion of patients free from 12wCDW was 97.6% after 48 weeks and 94.5% after 96 weeks of vidofludimus calcium treatment as compared to the start of the OLE phase.

Similar results were observed for 24wCDW and sustained CDW.

The OLE phase also showed low relapse activity.

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.

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 vidofludimus calcium in patients with RMS.

The ENSURE program comprises two identical multicenter, randomized, double-blind Phase 3 clinical 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 straightforward path towards potential regulatory approval of vidofludimus calcium in 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.

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

The ENSURE trials are being 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.

An interim analysis to assess event rates is planned to occur after approximately half of the relapse events 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.

We currently expect to report data from the interim analysis of the ENSURE program in late 2024 and to read-out the first of the ENSURE trials end of 2025.

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.

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.

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)

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

Manufactures under contract with us have developed and produced a formulation of vidofludimus calcium which would allow commercially usable production batches.

A Phase 1 bioequivalence study between the previous and the new formulation of vidofludimus calcium was completed 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 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 calcium after administration of the tablets was observed.

Additional investigations regarding metabolite characterization, metabolic modeling and potential drug-drug interactions, as well as other activities relating to clinical pharmacology are either ongoing or planned in anticipation for presentation to regulatory authorities.

Discussions on a pediatric development plan in pediatric-onset MS have been initiated with the FDA , based on a proposal developed with clinical and regulatory advisors.

Phase 2 Clinical Trial 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.

Our current expectation is to report data from the interim analysis of the CALLIPER trial in the second half of 2023 and to read-out top-line data at the end of 2024.

The multicenter, randomized, double-blind, placebo-controlled Phase 2 CALLIPER trial of vidofludimus calcium 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 EDSS which may further support disability data from the ENSURE trials.

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

The Phase 2 CALLIPER trial is intended to run concurrently with and to complement the Phase 3 program in RMS.

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.

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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

Diagnosis and Prevalence

UC is a chronic inflammatory disease characterized by diffuse inflammation of the mucosa of the colon and rectum.

The hallmark clinical symptoms of UC are diarrhea and bloody stool, and its clinical course is marked by exacerbations and remissions, which may occur spontaneously or in response to treatment changes or intercurrent illnesses.

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

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

Current Treatment Options

The severity and extent of UC are characterized based on clinical and endoscopic findings.

The treatment approach often depends on disease severity and typically follows a stepwise treatment regimen.

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) 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.

New biologic options are alpha-4-beta-7 (α4ß7) integrin-specific antibodies, such as vedolizumab and anti-IL-12/IL-23 antibodies, such as ustekinumab.

All biologics currently used to treat UC are injectables.

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

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:

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.

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 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.

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.

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

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.

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

The CALDOSE-1 trial of vidofludimus calcium in moderate-to-severe UC was 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).

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

The primary endpoint comprised 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.

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 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.

On June 2, 2022, we reported top-line data from our Phase 2 CALDOSE-1 trial of vidofludimus calcium in patients with moderate-to-severe UC.

The trial did not achieve the primary endpoint of clinical remission for the pooled 30 and 45 mg/day active dose groups of vidofludimus calcium versus placebo at week 10.

In addition, no meaningful differences were observed between the three active dose groups for the overall intent-to-treat patient population (10 mg/day:

14.9%, 30 mg/day:

10.6%, 45 mg/day:

13.6%, placebo:

12.5%) or for the trial’s other secondary endpoints, including symptomatic remission, or endoscopic healing.

Consistent with prior data sets in other patient populations, administration of vidofludimus calcium in this clinical trial was observed to be safe and well-tolerated.

No new safety signals were observed.

The most common adverse events in this clinical trial were anemia (15/263 patients, 5.7%), headache (9/263 patients, 3.4%) and COVID-19 (7/263 patients, 2.7%).

Most adverse events were generally mild in severity.

Surprisingly, CALDOSE-1 data suggest a previously unknown treatment interference between the efficacy of vidofludimus calcium and the concurrent use of corticosteroids in the UC patient population.

More specifically, the non-steroid patient population showed an 11.4% advantage in clinical remission for vidofludimus calcium over placebo (pooled vidofludimus calcium treatment groups at week 10:

14.7%, placebo:

Such a difference in clinical remission between active treatment and placebo would traditionally be considered as confirming therapeutic activity.

This treatment interference between vidofludimus calcium and corticosteroids was not expected based on our analysis of currently available preclinical or clinical data.

Based on these results, we announced that our development programs in the IBD indications will not be continued without a partner.

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

Crohn’s Disease

Diagnosis and Prevalence

CD is an idiopathic chronic inflammatory disease of unknown etiology with genetic, immunologic and environmental influences.

Like UC, it is one of the major diseases that are generally characterized as IBD.

Both UC and CD are caused by chronic inflammation in the gastrointestinal ("GI") tract, but CD can involve the entire GI tract, from the mouth to the anus (but it most commonly involves both the large and small intestines), whereas UC is restricted to the colon and rectum.

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.

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

However, the diagnosing physician needs to evaluate laboratory tests, endoscopy results, pathology findings and radiographic tests to arrive at a clinical diagnosis of CD.

In general, it is the presence of chronic intestinal inflammation that leads to a diagnosis of CD.

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

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.

Current Treatment Options

Treatment of CD is similar to treatment of UC.

However, some of the therapies available for UC (such as tofacitinib) have shown varying levels of activity in CD.

Conversely, and based on the treatment needs of patients with CD, some drugs have been primarily developed for CD.

One such example is the biologic ustekinumab, an antibody directed against IL-12 and IL-23.

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 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.

However, the side effect profile of leflunomide included diarrhea.

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.

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

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.

Based on the results of the Phase 2 CALDOSE-1 trial in UC, we announced that our development programs in the IBD indications will not be continued without a partner.

Primary Sclerosing Cholangitis

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

PSC is a rare liver disease in which the bile ducts in the liver become inflamed, narrow and prevent bile from flowing properly.

According to Toy et al.

(2011), PSC has a prevalence of approximately 4.15 per 100,000 in the United States.

The exact cause and disease mechanism of PSC are still unknown, but an autoimmune mechanism may play a role.

According to Singh et al.

(2013), there is an association with IBD, most often with UC and less commonly with CD.

Progressive biliary and hepatic damage results in portal hypertension and hepatic failure in a significant majority of patients over a 10-15 year period from initial diagnosis.

Current Treatment Options

Treatment of PSC is supportive, with a focus on monitoring the disease progression and treating symptoms and complications as they arise.

The only substantial treatment is liver transplantation, which may be an option when the disease progresses to cirrhosis and liver function is significantly affected.

When some of the larger bile ducts become blocked in patients with PSC, one potential is to open them with endoscopy-based methods, balloon dilatation or stent placement.

No medication is currently approved to treat PSC, but medications may be used to control symptoms.

Although many trials have failed to meet their endpoints in PSC, there are now a few studies for medications (such as obeticholic acid) that have shown limited activity in PSC.

Current Development Plan and Ongoing Studies

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.

Phase 2 Clinical Trial of Vidofludimus Calcium in Primary Sclerosing Cholangitis

We had previously entered into a collaboration with investigators at the Mayo Clinic to explore the use of vidofludimus calcium in Primary Sclerosing Cholangitis (“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.

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

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.

During the COVID-19 pandemic, which began in early 2020, 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, we determined to readout data of the 18 patients who were enrolled prior to the COVID-19 pandemic.

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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.

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 aspartate aminotransferase (“AST”) increase at week 24 of no more than 33%, as compared to baseline.

This positive primary outcome was achieved by 3 of 11 patients in the PP population (27.3%, 95% CI:

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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.

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.

Secondary objectives were to investigate the liver biochemistry parameters, levels of AST and 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:

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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.

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 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.

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 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.

We decided not to continue the development of vidofludimus calcium in PSC.

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

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.

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)

Phase 2 Clinical 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.

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

The results of the CALVID-1 trial have been published in the peer reviewed journal, Infectious Diseases and Therapy (Vehreschild et al., 2022).

The paper, authored by the principal investigator of one of the clinical sites participating in the study, Prof.

Maria Vehreschild, M.D., Head of Infectious Diseases at University Hospital Frankfurt, is entitled, “Safety and Efficacy of Vidofludimus Calcium in Patients Hospitalized with COVID-19:

A Double-Blind, Randomized, Placebo-Controlled, Phase 2 Trial.”

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.

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

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.

For example, drugs approved for MS 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.

The same finding was already observed in other controlled clinical trials of vidofludimus calcium.

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.

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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.

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 acquired immunodeficiency syndrome (“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.

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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.

On June 23, 2022, sponsor and lead site, University Hospitals Coventry and Warwickshire NHS Trust, London, United Kingdom, informed us that the IONIC trial is being closed down.

Recruitment for the trial ended on May 20, 2022 and the last patient follow-up occurred in September 2022.

On September 29, 2022, we were informed that the sponsor submitted the end of trial declaration.

The trial was 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.

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.

All of our drug development candidates require approval from the FDA (for the United States), European Medicines Agency (“EMA”, for the European Union) and other national competent authorities (for any other territory) before they can be marketed for sale in the applicable jurisdiction.

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

• preclinical laboratory tests, in vitro and in vivo preclinical studies and formulation and stability studies;

• the submission to the FDA of an application for human clinical testing, which is known as an IND;

• the submission to the FDA of an investigational new drug application for human clinical testing, which is known as an IND;

• adequate and well-controlled human clinical trials to demonstrate the safety and effectiveness of the drug;

• the submission of an 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 good manufacturing practice (“cGMP”), requirements to assure that the facilities, methods and controls are adequate to preserve the drug’s identity, strength, quality and purity;

• the submission to the FDA of a new drug application, which is known as an NDA, for a drug;

• the approval by the FDA of an NDA.

The FDA reviews all available data relating to safety, efficacy and quality and assesses the risk/benefit profile of a product candidate before granting approval.

The data assessed by the FDA in reviewing an NDA includes animal or preclinical testing data, chemistry, drug-drug interaction data, manufacturing controls data and clinical safety and efficacy data.

The data assessed by the FDA in reviewing an NDA includes preclinical testing data, including animal data, chemistry manufacturing and controls (“CMC”) data, PK, PD and drug-drug interaction data, and human clinical safety and efficacy data.

Moreover, an agreement for a pediatric development plan (“PSP”) is required to be achieved with the FDA prior to NDA submission.

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 us to perform additional preclinical or clinical testing regardless of whether FDA approval has been obtained.

These requirements vary by jurisdiction, may 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.

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.

We have an ongoing Phase 3 program for vidofludimus calcium in RMS and an ongoing Phase 2 clinical trial for vidofludimus calcium in PMS.

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

Completing such clinical 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.

There are also additional steps required to develop and validate large-scale manufacturing capabilities as well as manufacturing controls.

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.

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 and approved by regulatory agencies and we have not yet had any such discussions.

Vidofludimus Calcium Manufacturing and Formulation

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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.

Our existing manufacturers have the capacity for manufacturing of up to several million units annually.

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 vidofludimus calcium’s active ingredient, the calcium salt of vidofludimus.

One 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.

Patent Term Extension (“PTE”) and/or European Supplementary Protection Certificates (“SPC”) 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 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.

This patent would offer exclusivity until 2039.

In addition, a patent application covering the dosing scheme currently used with vidofludimus calcium was filed in 2017.

This patent would cover all salt and free acid forms and offers the link between the expected label and respective patent claims.

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.

Finally, an MS-specific patent application was filed in 2021 which would protect the dose strengths used for RMS and PMS until 2042.

On top of the patent exclusivity, vidofludimus calcium as a new chemical entity will receive regulatory protection, which likely leads to five years plus a potential 30 months extension protection in the United States and eight plus two years protection in Europe.

Further undisclosed patents dedicated to strengthen the exclusivity period for vidofludimus calcium and other forms of vidofludimus have been submitted or are planned to be submitted.

Vidofludimus calcium and izumerogant were acquired in a transaction with 4SC in September 2016.

We have subsequently submitted additional patent applications for independently developed intellectual property relating to each of vidofludimus calcium and izumerogant.

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

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.

Izumerogant (IMU-935):

Targeting RORγt and Th17

Izumerogant is a highly potent and selective inverse agonist of a transcription factor called RORγ/RORγt.

The nuclear receptor RORγt is believed to be 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.

We believe this target is an attractive potential alternative to approaches acting on IL-23, the IL-17 receptor and directly on IL-17.

Preclinical results confirm that izumerogant 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 izumerogant 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, izumerogant 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.

More recent research published in Nature Immunology (He et al., 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.

Preclinical experiments indicated that izumerogant leads to a potent inhibition of Th17 differentiation, inhibition of cytokine secretion, and induction of regulatory T cells.

Importantly, izumerogant 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 izumerogant has potential to be a first-and-best-in-class therapy for various autoimmune diseases.

Newly obtained data from acute and chronic treatment of mice corroborated in vivo that izumerogant 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.

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 product candidates have reached clinical Phase 2 studies.

However, to our knowledge, izumerogant is currently the only product candidate in active clinical development.

IMU-935 recently received the proposed International Nonproprietary Name (“INN”), izumerogant, from the WHO.

Diagnosis and Prevalence

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Plaques vary from a few millimeters in diameter to several centimeters and can be localized to a specific area or extend over most of the body surface.

Psoriasis is one of the most common chronic inflammatory skin diseases (Di Meglio et al.

The disease prevalence varies between geographic regions.

Studies of psoriasis suggest an overall prevalence of 2% to 3% of the world’s population, with a higher prevalence in U.S.

and Canadian populations (4.6% and 4.7%, respectively).

Psoriasis is one of the most common chronic inflammatory skin diseases affecting 2% to 4% of the population in Western countries (Di Meglio et al., 2014;

Armstrong et al., 2022).

The prevalence rates are influenced by age, geographic location, and genetic background (Chandran and Raychaudhuri, 2010).

Psoriasis is considered equally prevalent between genders and can occur at any age.

However, there seems to be a bimodal distribution of the age of disease onset, with a first peak between 15 and 30 years, and a second peak between 50 and 60 years of age.

However, there seems to be a bimodal distribution of the age of disease onset, with a first peak occurring during the teen years.

Approximately 40% of patients first experience the disease before the age of 20, and approximately 10% of cases occur before the age of ten.

A second peak has been reported in patients who are in their mid-50s (DRG, Psoriasis:

Disease Landscape & Forecast 2022).

Current Treatment Options

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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 processes.

Oral therapies, such as methotrexate, cyclosporine, apremilast and deucravacitinib, target anti-inflammatory processes.

Biologics block proteins produced by keratinocytes, dendritic cells, Th17 lymphocytes or other immune cells.

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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.

We intend to develop izumerogant as an oral and more convenient treatment option for patients with moderate to severe psoriasis with a mechanism of action and efficacy that more broadly addresses the pathophysiology of psoriasis as compared to 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).

Castration-resistant prostate cancer (“CRPC”) is a form of advanced prostate cancer and 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., 2010).

With an estimated almost 1.4 million new cases and 375,000 deaths worldwide, prostate cancer was the second most frequent cancer and the fifth leading cause of cancer death among men in 2020 (Sung H et al., 2021).

Among patients whose prostate cancer is metastatic at the time of diagnosis, bone pain may be the leading symptom.

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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.

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, 2015).

On July 12, 2021, we presented new preclinical data highlighting izumerogant's therapeutic potential in CRPC.

Third-party studies have shown that RORγ plays an important pro-tumor role by driving expression of the 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., 2019).

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, Guillain-Barré Syndrome (“GBS”) was considered a single disease entity.

It is now known to be a heterogeneous syndrome with several variant forms.

Acute inflammatory demyelinating polyradiculopathy is the most common form in North America, Europe and most of the developed world, where it accounts for approximately 90% of cases.

GBS is thought to result from an immune response to a preceding infection that cross-reacts with peripheral nerve components.

The exact mechanisms are unknown.

However, cellular and humoral immune responses are of relevance in the pathogenesis of GBS.

The clinical manifestation of GBS is characterized by an acute or subacute onset of a progressive, symmetric weakness in limbs or cranial nerve-innervated muscles, accompanied by absent or depressed deep tendon reflexes, and a characteristic profile in the cerebrospinal fluid and electrodiagnostic studies (Hughes et al.

Patients usually present a few days to a week after onset of symptoms.

The weakness can vary from mild difficulty with walking to nearly complete paralysis of all extremity, facial, respiratory, and bulbar muscles.

GBS occurs worldwide with an overall incidence of 0.16 to 3.0 per 100,000 person-years (McGrogan et al.

Thus, it is considered a rare disease.

The incidence increases by approximately 20% with every 10-year increase in age beyond the first decade of life (Sejvar et al.

In addition, the incidence is slightly greater in males than in females.

Current Treatment Options

Current treatments for patients with GBS include plasma exchange (also called plasmapheresis) and administration of intravenous immune globulin (“IVIg”).

Over the past three decades, no other therapies have been found to be effective for GBS.

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.

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, 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:

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

We believe izumerogant's potency in inhibiting tumorigenesis-promoting IL-17 and Th17 cells in vitro may result in further antitumoral activity in humans.

Current Development Plan and Clinical Studies

We are currently performing a Phase 1 clinical trial with izumerogant through our Australian subsidiary.

We believe that this development approach could accelerate the program due to certain unique regulatory requirements and processes in Australia.

In the third quarter of 2019, our Australian subsidiary received clearance from the Bellberry Human Research Ethics Committee in Australia to begin Phase 1 clinical trials of izumerogant under the Clinical Trial Notification scheme of the Australian Therapeutic Goods Administration.

The Phase 1 clinical trial of izumerogant is comprised of three parts:

Single Ascending Dose Part

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.

The first part of the Phase 1 clinical trial was a single ascending dose, double-blind, placebo-controlled study of izumerogant in healthy human subjects.

This part was designed to evaluate the drug’s safety and PK 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 izumerogant, 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 izumerogant 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.

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

Multiple Ascending Dose Part

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.

Following the single ascending dose part, we initiated a second portion of the Phase 1 clinical trial which was a multiple ascending dose, double-blind, placebo-controlled study in healthy human subjects with izumerogant given daily for 14 consecutive days.

This part assessed the safety and PK properties of izumerogant.

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 izumerogant or placebo, found these multiple ascending doses of izumerogant 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 izumerogant 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.

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.

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

Psoriasis Patients

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.

In light of the favorable safety and tolerability data observed in healthy human subjects, we announced on October 27, 2021 that we have initiated part C of the ongoing Phase 1 clinical trial, where moderate-to-severe psoriasis patients are randomized to 28-day treatment with izumerogant or placebo.

Assessments include safety, tolerability, PK and PD markers, as well as skin evaluations.

On October 20, 2022, we announced the outcome of a pre-planned interim group-level data analysis of our Phase 1b clinical trial of izumerogant in patients with moderate-to-severe psoriasis.

The pre-planned interim analysis revealed that the group averages for PASI reductions in the two active arms did not separate from placebo at four weeks.

Although the active arms performed in line with expectations, based on similarly designed trials, the trial experienced a greater decrease than expected in PASI in the placebo arm.

Administration of izumerogant and placebo in this trial were demonstrated to be safe and well-tolerated, and no new safety signals were observed.

We plan to provide further updates and guidance on potential next steps for this development program towards the end of the first quarter of 2023.

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.

Phase 1 Clinical Trial of Izumerogant in mCRPC

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The first patient was enrolled in December 2021.

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

The pre-planned dose escalation in the trial with dosing of up to 900 mg daily of izumerogant has been completed.

Initial safety data available, to date, show a promising safety profile, with only benign adverse events and no dose limiting toxicities.

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.

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.

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

GBS is an acute neurological disorder in which the body's immune system attacks its peripheral nervous system, and for which very few therapies exist.

The Company plans to announce additional details as soon as design and timing of the envisaged trial are further defined.

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.

Izumerogant (IMU-935) Manufacturing and Formulation

IM105935, the API of the izumerogant 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

Izumerogant (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.

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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.

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.

All three patents cover composition of matter of izumerogant and related formulations, and are expected to provide protection into at least 2038, without accounting for potential PTE in the United States or SPC in Europe, respectively.

Vidofludimus calcium and izumerogant were acquired in a transaction with 4SC in September 2016.

We have subsequently submitted additional patent applications for independently developed intellectual property relating to each of vidofludimus calcium and izumerogant.

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 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,

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

Targeting Intestinal Barrier Function

IMU-856 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 to the public.

Based on preclinical data, we believe this compound may represent a unique treatment approach, as the mechanism of action targets the restoration of the intestinal barrier function and bowel wall architecture in patients suffering from gastrointestinal diseases such as celiac disease, IBD, IBS-D and other intestinal barrier function associated diseases.

Bowel permeability is suspected to be involved in the initiation of many chronic inflammatory or autoimmune conditions, as the impaired intestinal barrier function may be one of the preconditions for antigens of the microbiome to be recognized by the body’s immune system.

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To date, there are no good treatment strategies to ameliorate impaired bowel permeability.

IBD is a chronic, inflammatory disorder characterized by transmural inflammation of a part of the GI tract (UC) or the entire GI tract (CD).

IBD is defined by relapsing and remitting episodes with progression over time to complications, including intestinal ulcers and bleeding.

The current hypothesis regarding the onset of IBD involves an impaired bowel wall barrier function as the central element of the pathophysiology.

In healthy bowel walls, bacteria cannot pass from the lumen to the lamina propria because tightness is maintained between the epithelial cells in what resembles an intact barrier function of the bowel wall.

However, in response to environmental or genetic factors, bowel wall barrier function may be weakened, allowing bacteria to pass through and enter the bowel wall, where immune cells recognize the bacteria.

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.

Ultimately, patients develop a chronic and systemic immune response.

The presence of certain “bad bacteria”, which may contain certain epitopes in the microbiota, or the overall makeup of the microbiome, which lack “good bacteria”, are also known to contribute to the sustained and overshooting inflammation in IBD.

Additionally, it was shown that IBD patients in endoscopic remission still display IBD symptoms if bowel tightness is not normalized.

Episodes of impaired bowel wall barrier function are also correlated with relapse weeks later.

Irritable bowel syndrome is a common GI disorder in which the underlying pathophysiology is poorly understood.

However, increased intestinal permeability in IBS-D patients has been reported.

Studies have shown that IBS-D patients have increased intestinal membrane permeability.

This increased intestinal permeability may be due to a number of factors, including low-grade inflammation, which has been reported in mucosal biopsies of some diarrhea-predominant and post-infectious patients, but not constipation-predominant patients.

It has been established that patients with inflammatory conditions, such as celiac sprue and acute alcoholic gastroenteritis, also have increased gut permeability.

Acute symptoms usually coincide with the acute inflammation that leads to chronic abdominal pain, diarrhea and bloating.

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.

Celiac Disease

Diagnosis and Prevalence

Celiac disease is a multifactorial, complex autoimmune disease caused by an inappropriate immune reaction against a degradation product of gluten 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 is estimated to affect 1 in 100 people, worldwide (Celiac Disease Foundation, 2022).

In the United States, alone, it is estimated that 2.5 million people are undiagnosed and are, therefore, at risk for long-term health complications.

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).

Many patients suffer from gastrointestinal symptoms such as diarrhea 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 such as fatigue, anemia, osteopenia, weight loss, 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.

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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

Current Treatment Options

There is currently no known cure or treatment for celiac disease and patients must adhere to a strict, life-long gluten-free diet which can help manage symptoms and avoid disease flareups.

However, a significant number of patients continue to experience disease activity and persistent symptoms despite a gluten-free diet as gluten is present in numerous food products, medications, household products and cosmetics as impurity.

Thus, there is an increasing number of different treatment options in clinical development to reduce the burden of living with celiac disease and improve long-term health outcomes.

Current Development Plan and Clinical Studies

Current treatments of many conditions of the bowel are aimed at inhibiting inflammation, but they do not target the impaired bowel wall barrier function.

IMU-856 is designed to target pathways impacting the bowel wall barrier function and is aimed to normalize such function.

Immunic believes that normalized bowel wall barrier function may avoid bacterial triggers, which may lead to the achievement and maintenance of remission without significantly influencing the immune competency of the patient.

Clinical Development Plan and Planned Studies

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.

The development activities for IMU-856 are intended to largely follow established processes and service provider relationships established for the IMU-935 development program.

This may lead to operational and financial synergies in study preparation and execution.

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 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.

We believe that normalized bowel wall barrier function may avoid bacterial triggers, which may lead to the achievement and maintenance of remission without significantly influencing the immune competency of the patient.

We are currently performing a Phase 1 clinical trial of IMU-856 through our Australian subsidiary.

We believe that this development approach could accelerate the studies due to certain unique regulatory requirements and processes in Australia.

The development activities for IMU-856 are intended to largely follow established processes and service provider relationships established for the izumerogant development program.

This may lead to operational and financial synergies in study preparation

and execution.

In the third quarter of 2020, our Australian subsidiary received clearance from the Bellberry Human Research Ethics Committee in Australia to begin Phase 1 clinical trials of IMU-856 under the Clinical Trial Notification scheme of the Australian Therapeutic Goods Administration.

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 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.

The first part of the Phase 1 clinical trial was a single ascending dose, double-blind, placebo-controlled study in healthy human subjects designed to assess safety, PD and PK properties of IMU-856.

Healthy human subjects were randomized in a double-blinded manner to either placebo or active treatment with single ascending doses of IMU-856 at 10 mg, 20 mg, 40 mg, 80 mg, 120 mg and 160 mg.

On September 20, 2022, we announced unblinded safety, tolerability and PK results from the single ascending dose part of the Phase 1 clinical trial of IMU-856 in healthy human subjects.

Single ascending doses of IMU-856 were found to be safe and well-tolerated and no maximum tolerated dose was reached.

No serious adverse events occurred.

Moreover, a dose-linear PK profile was observed across the investigated dose range.

Multiple Ascending Dose Part

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 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 to patients with a model disease which would allow to potentially provide initial evidence of activity of IMU-856.

The second portion of the Phase 1 clinical trial was a multiple ascending dose, double-blind, placebo-controlled study of IMU-856 in healthy human subjects.

Healthy human subjects were dosed for 14 consecutive days with 40 mg, 80 mg or 160 mg once-daily of IMU-856 or placebo in a double-blinded manner.

This part was designed to assess safety, PD and PK properties of IMU-856.

On September 20, 2022, we also announced unblinded results from the multiple ascending dose part of the ongoing Phase 1 clinical trial.

Multiple ascending doses of IMU-856 were found to be safe and well-tolerated and no maximum tolerated dose was reached.

Treatment emergent adverse events were mostly mild in severity.

No Investigational Medicinal Product-related serious adverse events were reported.

Celiac Disease Patients

On May 5, 2022, we announced the start of the patient cohorts in our ongoing Phase 1 clinical trial of IMU-856 in patients with celiac disease.

Approximately 42 patients were planned to be enrolled in two consecutive cohorts with IMU-856 given once-daily over 28 days.

Secondary objectives include PK and disease markers, including those evaluating gastrointestinal architecture and inflammation.

Sites in Australia and New Zealand are participating in Part C.

Initial results are expected to be available in mid-2023.

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.

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 a tablet.

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.

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 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.

On August 16, 2022, we announced that we have received a Notice of Allowance from the USPTO for patent application 16/646130, entitled, “Compound Having Cyclic Structure.” The patent covers composition-of-matter of IMU-856 and related pharmaceutical compositions and is expected to provide protection into at least 2038, without accounting for potential PTE.

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.

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.

All of Immunic’s drug development candidates require approval from the FDA (for the United States), EMA (for the European Union) and other national competent authorities (for any other territory) before they can be marketed for sale in the applicable jurisdiction.

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

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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 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;

• the submission to the FDA of an NDA for a drug;

• the approval by the FDA of an NDA.

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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, which is a request for authorization from the FDA to administer an IND product candidates to humans in clinical trials.

Preclinical trials must also be conducted in accordance with FDA, EMA, International Council for Harmonisation of Technical Requirements for Pharmaceuticals for Human Use (“ICH”) and other 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 in the US, a sponsor must submit the results of the preclinical tests and, where applicable, human clinical data obtained in trials outside of the US, 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 candidate 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.

In such a case, the IND sponsor and the FDA must resolve any outstanding concerns before the clinical trial can begin.

In such a case, the IND sponsor and the FDA must resolve any outstanding safety concerns before the clinical trial can begin.

The FDA may impose a clinical hold at any time before or during clinical trials due to safety concerns about proposed or ongoing clinical trials or non-compliance with FDA requirements, and the trials may not commence or continue until the FDA notifies the sponsor that the hold has been lifted.

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The trial sponsor submits the protocol, as well as any subsequent protocol amendments, to the FDA as part of the IND.

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 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.

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 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:

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Phase 2 studies are conducted in a limited patient population.

These studies continue to evaluate safety while gathering preliminary data on effectiveness in patients with the targeted disease or condition.

These studies continue to evaluate safety while gathering preliminary data on effectiveness in patients with the targeted disease or condition, especially studying the potentially therapeutically effective dose.

Phase 3 trials further evaluate efficacy and safety in an expanded patient population, generally at geographically dispersed clinical study sites.

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Before obtaining marketing approval for the commercial sale of any drug product, a sponsor must demonstrate in preclinical studies and well-controlled clinical trials that the product is safe and effective for its intended use and that the manufacturing facilities, processes and controls are adequate to preserve the drug’s identity, strength, quality and purity.

The results of these preclinical studies and clinical trials, along with descriptions of the manufacturing process, analytical tests conducted on the chemistry of the drug, proposed labeling and other relevant information are submitted to the FDA as part of an NDA requesting approval to market the product.

The results of these preclinical studies and clinical trials, along with descriptions of the manufacturing process, analytical tests conducted on the chemistry of the drug, proposed labeling and other relevant information such as an agreed pediatric development plan (agreed “PSP”) are submitted to the FDA as part of an NDA requesting approval to market the product.

The submission of an NDA is subject to the payment of substantial user fees ($3,242,026 for 2023);

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A CRL describes the specific deficiencies in the NDA identified by the FDA.

When possible, a CRL will recommend actions that the applicant might take, including providing additional clinical data, such as an additional Phase 3 trial or other significant and time consuming requirements related to clinical trials, nonclinical studies or manufacturing, to place the application in condition for approval.

When possible, a CRL will recommend actions that the applicant might take, including providing additional clinical data, such as an additional Phase 3 clinical trial or other significant and time consuming requirements related to clinical trials, nonclinical studies or manufacturing, to place the application in condition for approval.

If a CRL is issued, the sponsor must resubmit the NDA addressing all of the deficiencies identified in the letter, or withdraw the application.

Even if the sponsor submits the recommended data and information, the FDA may decide that the NDA does not satisfy the criteria for approval.

Even if the sponsor submits the recommended data and information, the FDA may decide that the resubmitted NDA does not satisfy the criteria for approval.

As condition to a product’s regulatory approval, the FDA may require a sponsor to conduct Phase 4 studies designed to further assess the drug’s safety and effectiveness after NDA approval, or may require other testing and surveillance programs to monitor the safety of the approved product.

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Substantially all of our long-lived assets were located within both the United States and Germany in 2022 and 2021.

As of February 18, 2021, we had 55 employees, six of whom held M.D.

Human Capital

As of February 23, 2023, we had 66 employees, nine of whom held M.D.

Of the employees, 50 were engaged in research and development and 16 in administration.

We consider our employee relations to be good.

We emphasize several measures and objectives in managing our human capital assets, including, among others, (i) employee safety and wellness, (ii) talent acquisition and retention, (iii) employee engagement, development and training, (iv) diversity and inclusion and (v) compensation.

These targeted ideals may include annual bonuses, stock-based compensation awards, a 401(k) plan, healthcare, and insurance benefits, paid time-off, family leave, employee assistance programs.

We also provide our employees with access to various innovative, flexible, and convenient health and wellness programs.

We designed these programs to support employees’ physical and mental health by providing tools and resources to improve or maintain their health status and encourage engagement in healthy behaviors.

Corporate Information and Website

Prior to April 12, 2019, we were a clinical-stage biotherapeutic company known as Vital Therapies, Inc.

that had historically been focused on the development of a cell-based therapy targeting the treatment of acute forms of liver failure.

Vital Therapies, Inc.

was originally incorporated in the State of California in May of 2003 as Vitagen Acquisition Corp., subsequently changed its name to Vital Therapies, Inc.

in June 2003, and reincorporated in Delaware in January 2004.

In April 2019, we completed an exchange transaction with Immunic AG pursuant to which holders of ordinary shares of Immunic AG exchanged all of their shares for shares of our common stock, resulting in Immunic AG becoming our wholly owned subsidiary.

Following the exchange, we changed our name to Immunic, Inc.

and we became a clinical-stage biopharmaceutical company focused on the development of selective oral therapies in immunology with the goal of becoming a leader in treatments for chronic inflammatory and autoimmune diseases.

Our corporate headquarters are located at 1200 Avenue of the Americas, Suite 200, New York, New York 10036.

We also have an office at Lochhamer Schlag 21, 82166 Grafelfing, Germany.

Our telephone number is (332) 255-9818.

We maintain a website at www.imux.com.

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What changed 10-K

Item 1. Business