Summer Greetings from Follicum

July 3, 2017

Summer Greetings from Follicum

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Dear shareholder,

Already, this year has brought plenty of exciting news. We have successfully completed our first clinical trial with FOL-005, a combined phase I/IIa trial, all in accordance to our plans. Furthermore, Follicum is now a partner in a comprehensive research project on diabetes, managed by the University of Lund and financed by the Swedish Foundation for Strategic Research. Our participation in this project is based on highly interesting pre-clinical results with a new substance showing an increase in release of insulin from beta-cells.

Phase I/IIa trial with FOL-005

The first clinical trial with the drug candidate, FOL-005, which was carried out at the Charité Hospital in Berlin, showed good safety for the compound, which was the primary endpoint for the trial. Furthermore, the trial showed substantial evidence of stimulated hair growth with an average increase of 8 % as compared to before treatment. Considering that the trial was carried out on the thighs, where the hair growth cycle is slower compared with follicles on the scalp, our judgement is that this is a successful outcome. The results obtained in our study are also on line with previous results with existing products in phase III trials on the scalp.

We can now conclude that FOL-005 is safe and well tolerated by the study subjects, which is very important and fundamental for our continued research program, with the ultimate goal of offering new treatment options with FOL-005.

follicum-diagram-01

Hair growth after three months treatment with placebo (PL) and four different doses of FOL-005 (D1-D4). The darker bars are the fraction of subjects obtaining increased hair growth and the lighter bars are the fraction without stimulating effect. The red line shows the bell shaped dose-response of FOL-005.

The market for stimulation of hair growth treatment

The market for treatment of alopecia, commonly called baldness, is extensive. Presently the sale of existing treatments worldwide is exceeding 3 BUSD yearly, and FOL-005 would become a successful alternative or complement to the presently available hair growth products.

Continued research on the drug candidate FOL-005

The onward research with FOL-005 will continue with a phase IIa trial to study the effects on the human scalp. In this coming trial, the hair growth will be evaluated with different doses and treatment frequencies in order to pinpoint an optimal treatment strategy.

In parallel we are also developing a user friendly formulation of the drug. We are following several tracks, such as a cream, ointment, gel or maybe FOL-005 in nano-particles, all in order to find a safe and attractive formulation. Several prototype formulations are currently tested, and based on the results we will select the optimal formulation for our drug. The new formulation will then be tested in future phase II and III trials, prior to registration and launch.

FOL-014 shows effect on release of insulin.

Our pre-clinical work on different human proteins has resulted in the development of the new peptide FOL-014. This peptide has shown a significant increase in the release of insulin from cells being isolated from the pancreas of mice. Additional pre-clinical studies within the area of diabetes will further investigate the effects of FOL-014.

Diabetes type 2 is a widespread disease caused by external factors such as overweight, alcohol, smoking and lack of exercise. The World Health Organization (WHO) estimates the number of people suffering from diabetes to more than 420 million world-wide and the number is expected to more than double within 20 years. The vision of Follicum is to build new values in the treatment of diabetes, based on the interesting effects of FOL-014.

follicum-pancreas-02

Accumulation of the peptide in the pancreas. A darker colour indicates a higher concentration of the peptide in the tissue.

follicum-pancreas-01

The peptide (red) binds to the insulin producing beta-cells in the pancreas. The blue colour indicates the cell nucleus, the green is a background colour to identify separate tissues.

Today, diabetes type 2 is treated with several different drugs. Several of these treatments tend to reduce or to avoid treatment with insulin. Among these new drugs are the GLP-1-analogues, which stimulate the insulin production. Today, the GLP-1-analogues are among the most successful products for diabetes and the sale value is expected to increase with more than 10 % the coming ten years. The blockbuster product, Victoza from Novo Nordisk, currently has a market share of 60 % and had a turnover  of 20 BDKK in 2016.

follicum-diagram-02

The release of insulin from isolated Islets of Langerhans after treatment with GLP-1 (black bar), the Follicum peptide (two different concentrations, blue bars, and without treatment (white bar).

Follicum partnering in an extensive diabetes research project

The Swedish Foundation for Strategic Research provides funding within natural sciences, technology and medicine and Follicum is one of several participants in a comprehensive project on diabetes research run by the University of Lund. The initial funding for this project is 100 MSEK. Follicum has been invited to take part in this extensive project together with well-established actors in the diabetes area, like Novo Nordisk, Johnson & Johnson, Pfizer as well as additional actors Probi, CardioVax and Region of Skåne University Hospitals of Lund and Malmö. The promising pre-clinical results with the drug candidate FOL-014 is our entry ticket to this multi-client project.

After a very exciting first half-year for Follicum, we look forward to the next half-year, just as exciting. I want to thank you all for your valuable support and I wish you a fantastic summer.

Lund on June 21, 2017

Jan Alenfall, CEO