Poxel Reports Cash and Revenue for the First Quarter 2023 and Provides Corporate Update

Regulatory News:

POXEL SA (Euronext: POXEL - FR0012432516), a clinical stage biopharmaceutical company developing innovative treatments for chronic serious diseases with metabolic pathophysiology, including non-alcoholic steatohepatitis (NASH) and rare metabolic disorders, today provided a corporate update and announced its cash position and revenue for the first quarter ended March 31, 2023.

Thomas Kuhn, Chief Executive Officer of Poxel, stated: “This quarter we successfully restructured our debt obligations and increased our financial flexibility with a new equity-linked financing with IRIS. Together these actions significantly extend our financial visibility through Q2 2025. Our lenders agreed to postpone initiation of repayments until Q1 2025, based on future potential royalties from increasing TWYMEEG net sales which will be directed towards debt repayments. Sumitomo Pharma, our partner commercializing TWYMEEG in Japan, recently reported the total sales for their fiscal year 2022, which significantly exceeded the forecast they had just increased by more than 20% a few months before. We are of course extremely pleased with this trajectory that confirms the value of TWYMEEG and gives us confidence in the timing of future expected positive royalties and sales-based payments. This also allows us to fully dedicate ourselves to our strategy, including the launch of Phase 2 proof-of-concept studies in adrenoleukodystrophy, pending additional financing. We continue to believe that our strategy in rare diseases has great potential for value creation.”

Corporate Update

• On March 23^rd, the Company announced that it had restructured its existing debt with its lenders, IPF and the banks that are part of the French Government Guarantee Loan (PGE Loan). In both agreements, amortization payments under the existing debt facility have been postponed and will reinitiate when the Company starts receiving positive net royalty flows from TWYMEEG (Imeglimin) sales in Japan. Based on the conservative forecast agreed upon by the Company and its lenders, amortization payments would be postponed until Q1 2025. During Sumitomo Pharma’s (Sumitomo) fiscal year (FY) 2024 (ending March 31, 2025), Poxel expects TWYMEEG net sales in Japan to reach at least JPY 5 billion (EUR 34.4 million)⁴, entitling Poxel to receive 10% royalties on all TWYMEEG net sales and a sales-based payment of JPY 500 million (EUR 3.4 million)⁴. Positive net royalties and sales-based payments will be directed to the debt reimbursement until the loans are fully repaid, which the Company expects in Q2 2029, at the latest. After this time, subsequent net royalties and sales-based payments will revert back to the Company. In addition to the postponement of debt repayments mentioned above, the Company and IPF have agreed to new financial covenants⁵.

• Concurrent with this debt restructuring, the Company entered into a new equity-linked financing arrangement with IRIS in the form of bonds redeemable for new or existing shares, in order to provide additional liquidity and flexibility intended to support its ongoing regulatory and development activities, as well as general corporate purposes. An initial amount of EUR 3.5 million was drawn down, and the Company has the option, at its sole discretion subject to certain condition precedent, to draw additional tranches up to the remaining EUR 11.5 million (for a total of EUR 15 million) over 2 years⁶. Upon conversion of the equity-linked instruments, IRIS will be issued Poxel shares to be created from the Company’s authorized capital and/or will receive existing ordinary shares of the Company and is expected to sell these shares on the market or in block trades.

• As part of refocusing its activities, the Company reviewed the organization of its Board of Directors and decided to reduce the size of the Board. Since March 31^st, Poxel’s Board of Directors is comprised of 4 members: Khoso Baluch as Chairman of the Board, Thomas Kuhn as CEO of Poxel, Pascale Boissel and Richard Kender as independent members. IPF remains an observer on the Board.

Commercial Update