Innovation Pharmaceuticals Provides Corporate Update Highlighting Clinical Pipeline Progress and Business Development Activities

·       Company building on momentum from recently executed licensing agreement with Alfasigma S.p.A.

·       Focus on transitioning to oral formulations of first-in-class drug candidates, and securing additional strategic alliances and licensing deals

BEVERLY, MA – July 29, 2019 (GLOBE NEWSWIRE) Innovation Pharmaceuticals (OTCQB:IPIX) (“the Company”), a clinical stage biopharmaceutical company, is pleased to provide a corporate update highlighting recent accomplishments, clinical pipeline progress, and ongoing business development activities across its first-in-class drug candidates, Brilacidin and Kevetrin.

“We are pleased with our accomplishments, thus far, in 2019, and are committed to advancing the clinical development of our pipeline,” commented Arthur P. Bertolino, MD, PhD, MBA, President and Chief Medical Officer at Innovation Pharmaceuticals. “A significant milestone was recently achieved with our execution of a global licensing agreement with Alfasigma—an Italy-based multinational pharmaceutical company with robust R&D and manufacturing capabilities, employing 3,000 people and generating 2018 revenues in excess of €1 billion—granting them worldwide rights to develop locally-administered Brilacidin in Ulcerative Proctitis/ Ulcerative Proctosigmoiditis (UP/UPS). We look forward to leveraging this momentum. Brilacidin is a promising Inflammatory Bowel Disease (IBD) drug candidate that appears to address many root causes of chronic gut disorders. Brilacidin also has been shown in other mid-stage clinical trials to be safe and efficacious in Serious Skin Infections and Oral Mucositis, with both of these Brilacidin indications Phase 3-ready.”

Bertolino continued: “The Alfasigma licensing agreement, importantly, enables us to access non-dilutive capital immediately and potentially into the future, via structured milestone-based payments and royalties. Equally important, we can now dedicate further internal resources to moving our clinical portfolio ahead—developing novel oral medications for hard-to-treat diseases like IBD, Oral Mucositis and Cancer. Successfully completing additional strategic alliances and licensing deals remains a primary objective, towards which we are making notable progress, with multiple active advanced-stage negotiations ongoing. We are excited about the Company’s prospects heading into the second-half of 2019, and anticipate providing future updates as events unfold.”

2019 Announcements

Brilacidin

Inflammatory Bowel Disease

·       July 22, 2019: Announced the execution of a licensing agreement with Alfasigma, an Italy-based global pharmaceutical company, for worldwide rights to develop Brilacidin for localized treatment of Ulcerative Proctitis/Ulcerative Proctosigmoiditis (UP/UPS).

As specified in the agreement, Alfasigma has assumed full responsibility for Brilacidin for UP/UPS, inclusive of all development, regulatory and commercialization activities and related expenses. In exchange for exclusive global rights, Alfasigma has committed to making an initial cash payment and other future cash payments to the Company upon certain milestones being met, totaling over $24 million. The Company also would receive a 6 percent royalty on net sales, resulting in additional annual recurring revenue. The initial payment will help cover substantially the costs of our upcoming clinical study of oral-dosed Brilacidin currently being developed for treating Ulcerative Colitis (UC). This first clinical trial, evaluating Brilacidin in oral tablet form, is targeted to commence later this year or early thereafter. In addition, the UP/UPS data generated by Alfasigma, to be shared with us, will help inform our internal development efforts in UC and as we explore other larger Gastrointestinal market opportunities.

·       June 6, 2019: Initiated, in partnership with BDD Pharma, oral development of Brilacidin in tablet form, utilizing BDD Pharma’s patented OralogiK™ tablet technology, which employs controlled erosion of a time-dependent barrier layer during small intestine transit to provide effective colon targeting. This will enable the testing of Brilacidin in more extensive forms of IBD, initially in UC and then in Crohn’s Disease—both chronic, hard-to-treat GI conditions for which oral therapies are highly sought after by patients and Big Pharma alike.

 ·       May 21, 2019: Attended the 2019 Digestive Disease Week (DDW) Conference, the world’s leading educational forum for professionals working in gastroenterology and related fields.

 ·       January 14, 2019: Completed early testing evaluating the stability of Brilacidin in simulated gastric fluid—a synthetic form of the fluid found in the stomach. Results showed very minimal degradation of Brilacidin across 4 hours, reinforcing the drug’s potential for oral development.

Oral Mucositis

·       May 1, 2019: Received End-of-Phase 2 Meeting Minutes from the Food and Drug Administration (FDA) to align our Phase 3 oral rinse Brilacidin program for the prevention of Severe Oral Mucositis (SOM) in Head and Neck Cancer (HNC) patients receiving chemoradiation. Currently, there are no approved drugs for this indication, with an annual global market opportunity estimated to approach $1 billion.

 ·       April 9, 2019: Achieved enhancements in manufacture of Brilacidin Phase 3 drug supply. This builds on the earlier contract signed with Evonik to facilitate and refine bulk production of commercial-grade Brilacidin and on the drug product agreement signed with CoreRx to formulate Brilacidin into granular form in unit sachets, providing OM patients with a convenient, portable, quick-mixing “instant” Brilacidin oral rinse therapy.

 ·       March 28, 2019: Formed European subsidiary and granted a Scientific Advisory meeting with the European Medicines Agency (EMA) to discuss a briefing package submitted for Scientific Advice regarding the clinical development program of Brilacidin oral rinse to decrease the incidence of SOM in HNC patients receiving chemoradiation.

 ·       February 19, 2019: Obtained patent from the U.S. Patent & Trademark Office (USPTO) that covers methods for treating and/or preventing mucositis with one or more compounds, or pharmaceutically acceptable salts.

 ·       January 2, 2019: Obtained patent from USPTO for Brilacidin in the form of a composition containing water. The composition can also contain Tris-buffered saline. The patent also covers Brilacidin in combination with other medicaments.

Kevetrin

Oncology

·       June 2019: Abstract published—“Kevetrin Dampens MYC Expression and Cellular Metabolism in Acute Myeloid Leukemia”—in collaboration with independent cancer researchers; presented at the European Hematological Association (EHA) 2019 Annual Meeting. Results showed Kevetrin alters cellular metabolism and several key genes, including MYC, which when dysfunctional is implicated in many types of cancers. These results further support Kevetrin’s treatment potential in AML, especially among those patients carrying p53 mutations for whom few therapeutic options exist.

 ·       April 16, 2019: Notified by independent cancer researchers that a scientific article on Kevetrin is under review for publication by a leading oncology journal. The paper details Kevetrin’s treatment potential in AML by targeting p53, an important tumor suppressor protein, and several key leukemia-related genes. AML accounts for almost one-third of all leukemias worldwide and has a 5-year survival rate of only 25 percent. Pre-clinical research and academic literature also supports Kevetrin’s potential in combination with cancer immunotherapies.