MedinCell publishes its financial results and activity report for the first half of 2021-2022 (April - September 2021)

Revenue: €4.1 million (+30% compared with the first half of the previous year)

Operating expenses: €15.3 million (+36%)

Cash consumption from operations: €11.3 million

Available cash: €34.4 million in cash + €3.0 million in non-risky financial assets (€2.9 million current + €0.1 million non-current)

Post-closing (November 2021)
€3.1 million received in Research Tax Credit + €3.0 million loan received from Bpifrance + €1.0 million, partially collected, as a grant within the framework of the French Recovery Plan (Plan France Relance)

MONTPELLIER, France--(BUSINESS WIRE)--Regulatory News:

MedinCell (Paris:MEDCL):

mdc-IRM (schizophrenia): marketing planned from 2022 by Teva in the United States, subject to FDA approval

• FDA acceptance of New Drug Application for mdc-IRM for treatment of patients with schizophrenia in August 2021
• Phase 3 data for mdc-IRM, presented by Teva Pharmaceuticals at Psych Congress (October 30-November 1, 2021), shows significant improvements for patients with schizophrenia: prolonged time to impending relapse, decreased risk of relapse and increased chance of clinical stability

Key events of the period

Press releases available on invest.medincell.com

Post-closing

Details of the portfolio of products in regulatory development based on BEPO^® technology

As of December 8, 2021, MedinCell's product portfolio consists of:

• 1 product candidate awaiting marketing approval in the United States for marketing as early as 2022 provided marketing authorization from FDA,
• 2 product candidates in clinical development and 6 product candidates in preclinical regulatory development,
• 6 are being developed in partnership with or with the financial support of health foundations or agencies, the others are internal programs funded directly by MedinCell,
• Among these programs (at preclinical and clinical stage), 8 are in human health and 1 in animal health.

Several other programs, developed alone, in partnership with pharmaceutical companies or with the support of foundations or international agencies, are currently at the evaluation or formulation stage, which is a prerequisite to the selection of a product candidate.

Program awaiting marketing approval

Clinical stage programs

Next potential candidates for IND/IMPD (clinical trial authorizations)

Selected financial information for the half-year 2021

Financial visibility maintained

MedinCell still benefits from a solid financial visibility.

The operating cash flow for the first half of the year reflects the increase of investment required to expand and advance the Company's product portfolio.

As of September 30, 2021, MedinCell had €34.4 million in cash and €3.0 million in non-risky financial assets, compared to €47.1 million in cash and €3.9 million in non-risky financial assets as of March 31, 2021.

No new loans were obtained during the first half of the year. Post-closing, the Company received €3.0 million from Bpifrance in the form of a loan and secured €1.0 million grant, partially collected, within the framework of the French Recovery Plan (Plan France Relance).

A- Net cash provided by operating activities

During the first six months, the Company's operating cash burn increased compared to the same period of the previous year. Firstly, the reimbursement of the €3.1 million Research Tax Credit for 2020 was received in November, whereas the previous year, €3.2 million was received in May 2020. Secondly, the Company had implemented austerity measures at the beginning of the pandemic in March 2020 given the economic uncertainties of that period.

B- Net cash flow from investing activities

Investments during the period consisted of capitalized instruments for improvements at the Jacou site totaling €0.5 million. They were offset by a positive change in financial investments of €1.0 million.

C- Net cash flow from financing activities

Cash flow during the first half of the year was negative, as it mainly comprises repayment of financial debts, interests and leases during the period. It should be noted that, in the first half of the previous fiscal year, the Company obtained €11.9 million in State Guaranteed Loans and carried out a capital increase of €15.6 million gross.

Income statement

Income from ordinary activities: €4.1 million

Revenues for the first half of the 2021-2022 fiscal year increased 30% compared to the previous period and were mainly generated by services for product formulation activities developed with partners. These first-half revenues resulted from (i) collaborations with the Bill & Melinda Gates Foundation: development of an injectable female contraceptive active for 6 months; and (ii) the collaboration with the international agency Unitaid on a project that aims to fight malaria transmission.

The Company also points out that the first revenues linked to product sales should be royalties from the marketing of the first product developed with Teva Phamaceuticals. Until then, due to the product development cycle and depending on the financial parameters set up within the framework of partnerships (which may or may not include certain elements such as invoicing for formulation services, milestone payments, royalties, cost sharing, profit sharing, etc.), its revenues may vary significantly from one period to the next.

Other revenue from ordinary activities

The Company benefits from Research Tax Credit for its research and development (R&D) activities, which is recorded under "Other income from ordinary activities". This one has increased significantly compared to last year, by 29%, due to the increased need of CRO (Contract Research Organization) and CMO (Contract Manufacturer Organization) services. Following the prioritization of the Company's activities in favor of strategic projects on the first wave of the pandemic in 2020, and the implementation of partial activity between April and June 2020, the amounts of the Research Tax Credit were highly impacted.

Current operating expenses in line with the Company's strategy: €15.3 million

Operating expenses increased by 36% compared to the same period of the previous year, as progress was made in the various programs.

More than 73% of the expenses are related to R&D, whose costs increased by 44% this semester. In the first half of the previous year, the Company had implemented savings measures, delayed expenses and had certain teams in partial activity.

In line with the forecasts and the strategy of expanding the Company's product portfolio, R&D expenses included mainly CRO and CMO services to advance the programs that are in formulation research or in preclinical studies in order to prepare their next steps.

Sales and Marketing expenses increased by 46% compared to the same period of the previous year. In the first half of the previous year, the health crisis prevented any travel and led to a reduction in the activities of the strategic marketing, market access and business development team, resulting in a reduction or a delay of expenses. This year, activities, with the exception of travel, which remains limited, have returned to a normal level.

G&A expenses increased slightly over the period, mainly due to personnel costs and the impact of Restricted Stock Units (AGA) plans.

Net financial result: €(0.5) million

Net financial expenses amounted to €0.5 million, compared to €2.6 million in the first half of the previous year, and mainly consisted of interest charges on the bond and the EIB loan. During the first six months ending September 30, 2020, the characteristics of the variable remuneration were modified in the June 2020 amendment related to the conditions of the third and final €5.0 million tranche of the EIB loan. This implied a new estimate of the cost of debt linked to the variable remuneration of the EIB loan of €1.3 million was recorded.

Consolidated income statement

Balance sheet summary

As of September 30, 2021, the Company's assets included €37.4 million in cash, cash equivalents and non-risky investments and a gross debt of €41.5 million at September 30, 2021, versus €42.3 million at March 31 2021. 90% of this is non-current debt and primarily consists of a European Investment Bank loan of €22.5 million and State-Guaranteed Loans (PGE) of €13.8 million. Net Debt was thus €4.1 million, versus €(8.8) million at March 31^st, 2021.

About MedinCell

MedinCell is a clinical stage pharmaceutical company that develops a portfolio of long-acting injectable products in various therapeutic areas by combining its proprietary BEPO^® technology with active ingredients already known and marketed. Through the controlled and extended release of the active pharmaceutical ingredient, MedinCell makes medical treatments more efficient, particularly thanks to improved compliance, i.e. compliance with medical prescriptions, and to a significant reduction in the quantity of medication required as part of a one-off or chronic treatment. The BEPO^® technology makes it possible to control and guarantee the regular delivery of a drug at the optimal therapeutic dose for several days, weeks or months starting from the subcutaneous or local injection of a simple deposit of a few millimeters, fully bioresorbable. Based in Montpellier, MedinCell currently employs more than 140 people representing over 25 different nationalities.
www.medincell.com

This press release contains forward-looking statements, including statements regarding Company’s expectations for (i) the timing, progress and outcome of its clinical trials; (ii) the clinical benefits and competitive positioning of its product candidates; (iii) its ability to obtain regulatory approvals, commence commercial production and achieve market penetration and sales; (iv) its future product portfolio; (v) its future partnering arrangements; (vi) its future capital needs, capital expenditure plans and ability to obtain funding; and (vii) prospective financial matters regarding our business. Although the Company believes that its expectations are based on reasonable assumptions, any statements other than statements of historical facts that may be contained in this press release relating to future events are forward-looking statements and subject to change without notice, factors beyond the Company's control and the Company's financial capabilities.

These statements may include, but are not limited to, any statement beginning with, followed by or including words or phrases such as "objective", "believe", "anticipate", “expect”, "foresee", "aim", "intend", "may", "anticipate", "estimate", "plan", "project", "will", "may", "probably", “potential”, "should", "could" and other words and phrases of the same meaning or used in negative form. Forward-looking statements are subject to inherent risks and uncertainties beyond the Company's control that may, if any, cause actual results, performance, or achievements to differ materially from those anticipated or expressed explicitly or implicitly by such forward-looking statements. A list and description of these risks, contingencies and uncertainties can be found in the documents filed by the Company with the Autorité des Marchés Financiers (the "AMF") pursuant to its regulatory obligations, including the Company's registration document, registered with the AMF on September 4, 2018, under number I. 18-062 (the "Registration Document"), as well as in the documents and reports to be published subsequently by the Company. In particular, readers' attention is drawn to the section entitled "Facteurs de Risques" on page 26 of the Registration Document.

Any forward-looking statements made by or on behalf of the Company speak only as of the date they are made. Except as required by law, the Company does not undertake any obligation to publicly update these forward-looking statements or to update the reasons why actual results could differ materially from those anticipated by the forward-looking statements, including in the event that new information becomes available. The Company's update of one or more forward-looking statements does not imply that the Company will make any further updates to such forward-looking statements or other forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements.

This press release is for information purposes only. The information contained herein does not constitute an offer to sell or a solicitation of an offer to buy or subscribe for the Company's shares in any jurisdiction, in particular in France. Similarly, this press release does not constitute investment advice and should not be treated as such. It is not related to the investment objectives, financial situation, or specific needs of any recipient. It should not deprive the recipients of the opportunity to exercise their own judgment. All opinions expressed in this document are subject to change without notice. The distribution of this press release may be subject to legal restrictions in certain jurisdictions. Persons who come to know about this press release are encouraged to inquire about, and required to comply with, these restrictions.

MedinCell
David Heuzé
Head of communication
david.heuze@medincell.com
+33 (0)6 83 25 21 86

NewCap
Louis-Victor Delouvrier / Olivier Bricaud
Investor Relations
medincell@newcap.eu
+33 (0)1 44 71 94 94

NewCap
Nicolas Merigeau
Media Relations
medincell@newcap.eu
+33 (0)1 44 71 94 94