Adocia Announces Third Quarter 2019 Financial Results - Seite 2

• Net cash position

Including the payment from Lilly of the contractual milestone of USD 11.6 million USD 2.6 million of interest received in September 2019, the Company has a cash position of EUR 32.5 million as of September 30, 2019, compared to EUR 39.8 million as of January 1, 2019. As of October 14, 2019, the Company has a cash position of more than EUR 39 million, after the subscription of EUR 7.5 million for the first tranche of the financing agreement with IPF Partners.

Net cash flow for the first nine months of 2019 is EUR 7.3 million. Excluding USD 14.3 million received from Lilly and EUR 4.1 million paid in legal fees, net cash flow is EUR 16.2 million compared to EUR 14.7 million for the same period last year, on a comparable basis. The EUR 1.5 million increase is primarily due to fewer research and development expenses eligible for the French research tax credit.

Financial debt as of September 30, 2019 amounts to EUR 8 million compared to EUR 7.1 million as of December 31, 2018. Debt mainly consists of a loan secured in 2016 to finance the acquisition and renovation of the building in which the headquarters and the research center of the Company are located as well as an additional loan of EUR 1.2 million contracted in February 2019 to finance the renovation work on two floors of 450 sqm each dedicated to the analysis department.

As of October 14, 2019, the financial debt amounts to EUR 15.5 million, after the subscription of EUR 7.5 million for the first tranche of the financing agreement with IPF Partners.

Main legal, financial and organizational events for the third quarter 2019 and the beginning of October 2019:

On legal matters, the third quarter of 2019 marked the conclusion of the arbitration procedure initiated by Adocia against Lilly in 2017.

In August 2018, the American Arbitration Association Tribunal (“the Tribunal”) governing the procedure had ruled in Adocia’s favor regarding its first claim, which related to a contractual milestone payment contested by Lilly, and awarded Adocia USD 11.6 million, plus interest. The related payment of EUR 14.3 million was received on September 30, 2019.

In August 2019, the Tribunal dismissed both parties’ claims in the second phase of the procedure. In this second phase, Adocia had filed claims against Lilly for misappropriation and misuse of its confidential information and discoveries and Lilly had subsequently filed counterclaims based on allegations that Adocia concealed the discoveries and confidential information which were at issue in Adocia's claims. The arbitration procedure is now finalized.