Combination of Poolbeg and HOOKIPA Pharma Inc

The boards of directors (each a "Board") of HOOKIPA Pharma Inc. ("HOOKIPA") and Poolbeg Pharma plc ("Poolbeg") are pleased to announce that they have entered into non-binding discussions for an all-share acquisition by HOOKIPA of Poolbeg (the "Potential Combination") to create a strong clinical-stage biopharmaceutical company focused on developing and commercialising innovative medicines for critical unmet medical needs, with a special focus on next-generation immunotherapies for the treatment of cancer and other serious diseases (the "Combined Group").  

The Potential Combination is intended to be implemented by means of a scheme of arrangement under Part 26 of the Companies Act 2006.

The Boards believe that the Potential Combination would create a Nasdaq-listed Combined Group operated by a combined management team experienced in successfully developing and commercializing medicines with a focus on execution and operational excellence. The Boards also believe the Potential Combination would create a diversified clinical pipeline led by multi-KRAS targeting HB-700, a next generation immunotherapy potentially offering additional treatment options for cancers with limited treatment options, and Phase 2-ready small molecule POLB 001, a potentially breakthrough orally delivered preventative therapy for cancer immunotherapy-induced CRS, with potential value inflection points in areas of interest in the pharmaceutical industry. Furthermore, the Boards expect the Potential Combination to bolster near-term clinical data catalysts, with clinical data expected across multiple programmes over the next 24-months in large therapeutic areas with unmet medical needs. The Combined Group would also have two partnered programmes with Gilead Sciences, Inc. ("Gilead"), offering the potential of significant development and commercialisation milestones in addition to significant sales royalties (if either product is approved) for the Combined Group's shareholders.

HOOKIPA is listed on the Nasdaq Capital Market under the symbol HOOK and Poolbeg is listed on AIM under the symbol POLB.

Expected key terms of the Potential Combination based on discussions to date comprise of:

· Poolbeg shareholders will receive 0.03 HOOKIPA shares for each Poolbeg share held (the "Exchange Ratio");

· based on the Exchange Ratio, the Potential Combination would have the effect (on the basis of the assumptions set out below and prior to the dilution resulting from the Fundraise (as defined below)) that Poolbeg shareholders prior to the completion of the Potential Combination are expected to receive, on a fully diluted basis, approximately 55% of the equity in the Combined Group (the "Poolbeg Ownership Percentage") and HOOKIPA shareholders are expected to hold approximately 45% of the equity in the Combined Group (the "HOOKIPA Ownership Percentage");

· HOOKIPA is expected to undertake a 100% primary private placement fundraise of up to approximately $30 million (the "Fundraise") which will be funded into HOOKIPA immediately following the completion of the Potential Combination in order to provide sufficient capital for the enlarged business to realize meaningful expected value inflection points, including (i) Phase 1 interim data for HB-700 in the first half of 2026, (ii) Phase 2a topline data for POLB 001 in the second half of 2026 and (iii) primary completion of the Phase 1b trial of HB-500 in the second half of 2025. Upon completion of the Fundraise, the Combined Group would be debt free with financial runway through year-end 2026, assuming the receipt of future expected R&D grant proceeds from the Government of Austria, which HOOKIPA has received in previous years for qualifying research and development expenses and capital expenditures. The Fundraise would be expected to be completed concurrently with the completion of the Potential Combination by early in the second quarter of 2025 and would be conditional upon completion of the Potential Combination (unless otherwise waived or amended), although completion of the Potential Combination will not be conditional upon completion of the Fundraise;

· following the completion of the Fundraise, both the HOOKIPA Ownership Percentage and the Poolbeg Ownership Percentage would be reduced proportionally based on the number of HOOKIPA shares issued to investors in connection with the Fundraise. For example, illustratively assuming the proceeds of the Fundraise total $30 million and HOOKIPA shares are issued to investors at HOOKIPA's 60-day volume weighted average price ("VWAP") of $2.81 as of 31 December, 2024, the illustrative HOOKIPA Ownership Percentage, on a fully diluted basis, would be 32.8%, the illustrative Poolbeg Ownership Percentage would be 40.1%, and the investors in the Fundraise would hold 27.1% of the equity in the Combined Group);

· a percentage of the potential value from certain of HOOKIPA's programmes will be retained by holders of HOOKIPA shares as at a date to be determined ahead of completion of the Potential Combination ("HOOKIPA Shareholders") via a contingent value right instrument ("CVR"), with the balance of such potential value attributable to the Combined Group. On a fully diluted basis, The CVR is expected to provide that HOOKIPA Shareholders will be entitled to approximately (i) 55% of the milestone payments made by Gilead to HOOKIPA following the achievement of specified development and commercialisation milestones for the HB-400 and HB-500 programmes (which could be worth up to $407.5 million in nominal terms) and (ii) 80% of proceeds generated by the HB-200 programme (the "HOOKIPA CVR Ownership Percentage"), subject to an adjustment mechanism which may result in a lower HOOKIPA CVR Ownership Percentage based on HOOKIPA's net cash on completion of the Potential Combination (the "CVR Adjustment Mechanism"). Please refer to Appendix A for additional detail on HOOKIPA's programmes covered by the CVR and Appendix B for additional detail on the CVR Adjustment Mechanism.

· HOOKIPA intends to remain as the listed entity for the Combined Group on the Nasdaq Capital Market and Poolbeg is expected to become a private subsidiary of HOOKIPA and apply for cancellation of the admission of its shares to trading on AIM; and

· The Combined Group is expected to have operations in the European Union, the United Kingdom and the United States of America, and anticipates benefiting from a strong international leadership team comprised of the following individuals:

o  Malte Peters, MD, PhD: Chief Executive Officer

o  Cathal Friel: Executive Chairman, Poolbeg Co-Founder

o  Ian O'Connell: Chief Financial Officer, Poolbeg Co-Founder

o  Mark Winderlich, PhD: Chief Development Officer

o  David Allmond: Chief Business Officer

o  John McEvoy: Chief Legal Officer

The announcement by HOOKIPA of any firm offer under Rule 2.7 of the Code in respect of the Potential Combination is subject to the satisfaction or waiver of a number of customary pre-conditions, including, amongst other things, the satisfactory completion of customary due diligence, finalisation of the terms of the transaction, Board approvals of binding terms and sufficient prior expressions of interest from participants in respect to the Fundraise. Before the announcement of any firm offer under Rule 2.7 of the Code, both HOOKIPA and Poolbeg intend to engage with potential investors in the Fundraise, further details of which will be included in a separate presentation (the "Fundraise Presentation"), which upon first use will be made available on HOOKIPA's website at www.ir.hookipapharma.com/potential-combination. The Potential Combination would be subject to the approval of both HOOKIPA and Poolbeg shareholders and other conditions.

All discussions to date have been non-binding and on a non-exclusive basis, and there can be no assurance that a firm offer will be made or that any transaction will be completed.

Information on HOOKIPA

HOOKIPA is a clinical-stage biopharmaceutical company focused on developing next generation immunotherapies based on its proprietary arenavirus platform. HOOKIPA's product candidates are designed to induce specific, robust and durable CD8+ T cells and antibodies to eliminate cancers and serious infectious diseases. HOOKIPA's pipeline includes biological therapies for oncology, targeting human papillomavirus type 16-positive ("HPV16+") cancers, KRAS mutated cancers, and other targets. In addition, HOOKIPA has partnered with Gilead to develop therapies that are intended to provide functional cures for hepatitis B virus ("HBV") and human immunodeficiency virus-1 ("HIV"). HOOKIPA's next-generation vaccine platform is designed to supercharge immunity with its T cell activation platform based on work of Nobel laureate and HOOKIPA co-founder, Rolf Zinkernagel. Further details of HOOKIPA's platform are set out in Appendix C.

Information on Poolbeg

Poolbeg is a clinical-stage biopharmaceutical company focused on acquiring, developing and commercialising innovative medicines that will help improve the lives of patients with rare and orphan diseases and where there is a high unmet medical need. Poolbeg's clinical programmes target large addressable markets including cancer immunotherapy-induced Cytokine Release Syndrome ("CRS"), infectious disease, and metabolic conditions such as obesity with the development of an oral GLP-1R agonist. Further details of Poolbeg's platform are set out in Appendix C.

Important Takeover Code notes

There can be no certainty that any firm offer will be made, even if the pre-conditions referred to above are satisfied or waived.

In accordance with Rule 2.4(c) of the Code, HOOKIPA will be required, pursuant to Rule 2.6(a) of the Code, by no later than 5.00 p.m. on 30 January 2025, to either announce a firm intention to make an offer for the Company, under Rule 2.7 of the Code, or announce that it does not intend to make an offer for the Company, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies. The deadline can only be extended with the consent of the Panel in accordance with Rule 2.6(c) of the Code.

This announcement has been made with the approval of HOOKIPA.

Pursuant to Rule 2.5 of the Code, HOOKIPA reserves the right to introduce other forms of consideration and/or vary the mix or composition of consideration of any offer and vary the transaction structure. HOOKIPA also reserves the right to amend the terms of any offer (including making the offer at a lower value, whether by amending the Exchange Ratio or the HOOKIPA CVR Ownership Percentage or otherwise):

a)   with the recommendation or consent of the Poolbeg board;

b)   if Poolbeg announces, declares or pays any dividend or any other distribution or return of value to shareholders after the date of this announcement, in which case HOOKIPA reserves the right to make an equivalent reduction to the terms of its proposal;

c)   following the announcement by Poolbeg of a Rule 9 waiver pursuant to the Code; or

d)   if a third party announces a firm intention to make an offer for Poolbeg.

Prior to this announcement it has not been practical for HOOKIPA to make enquiries of all persons acting in concert with it to determine whether any dealings in Poolbeg shares by such persons give rise to a requirement under Rule 6 or Rule 11 of the Code for Poolbeg, if it were to make an offer, to offer any minimum level, or particular form, of consideration. While neither HOOKIPA nor Poolbeg are aware of any such dealings, in accordance with Note 4 on Rule 2.4, any such details shall be announced as soon as practicable and in any event by no later than 16 January 2025.