Bone Therapeutics agrees final settlement with the FSMA regarding clinical studies communication issues in 2016 and 2017

Bone Therapeutics to focus in future on the development of its MSC cell and gene therapy pipeline

Gosselies, Belgium, 27 July 2021, 7pm CEST – BONE THERAPEUTICS (Euronext Brussels and Paris: BOTHE), the cell therapy company addressing unmet medical needs in orthopedics and other diseases, today announces that it has entered into a settlement with the Belgian Financial Services and Markets Authority (FSMA). The settlement brings a final resolution to an investigation related to communication issues on past clinical studies dating to 2016 and 2017.

In 2016, Bone Therapeutics decided to direct its strategic focus to its next-generation, scalable off-the-shelf allogeneic cell therapy platform, ALLOB. This decision was taken to maximize value creation and to ensure the best use of available resources. The development of PREOB for the treatment of osteoporosis (OP), non-union fractures (NU) and hip osteonecrosis (ON) was discontinued in subsequent years. Following these developments, the FSMA started an inquiry in the framework of Regulation (EU) No. 596/2014 of the European Parliament and of the Council of 16 April 2014 (Market Abuse Regulation) in 2018. Bone Therapeutics has fully cooperated with this investigation.

In particular, at the time, Bone Therapeutics encountered difficulties in the clinical development of three programs, ALLOB-OP in preparation, PREOB-NU and PREOB-ON. These difficulties were identified in February and December 2016. The difficulties included a lack of external partners, recruitment delays and failures of acceleration programs. According to the FSMA, Bone Therapeutics, did not clearly communicate on this information until the press releases announcing the discontinuation of the clinical development of these three programs respectively in January 2017, December 2017 and November 2018.

Subsequent to these actions described above, the board and management of Bone Therapeutics have quasi-totally changed. To conclude this chapter definitively, the board and management has taken a number of initiatives to strengthen its market communication procedures. It has also concluded a settlement with the FSMA without an acknowledgment of guilt, and has agreed to a settlement amount of €500,000. This settlement amount has no lasting impact on Bone Therapeutics’ ongoing activities and the development of its future programs.

This settlement will allow Bone Therapeutics’ board of directors and management to fully focus in the future on the development of the modified Mesenchymal Stromal Cell (MSC) platform including ALLOB and the enhanced viscosupplement JTA-004.

The settlement was accepted by the FSMA’s Executive Committee on 27 July 2021 and has been published on the FSMA’s website.

About Bone Therapeutics

Bone Therapeutics is a leading biotech company focused on the development of innovative products to address high unmet needs in orthopedics and other diseases. The Company has a diversified portfolio of cell and biologic therapies at different stages ranging from pre-clinical programs in immunomodulation to mid-to-late stage clinical development for orthopedic conditions, targeting markets with large unmet medical needs and limited innovation.

Bone Therapeutics is developing an off-the-shelf next-generation improved viscosupplement, JTA-004, which is currently in Phase III development for the treatment of pain in knee osteoarthritis. Consisting of a unique combination of plasma proteins, hyaluronic acid – a natural component of knee synovial fluid, and a fast-acting analgesic, JTA-004 intends to provide added lubrication and protection to the cartilage of the arthritic joint and to alleviate osteoarthritic pain and inflammation. Positive Phase IIb efficacy results in patients with knee osteoarthritis showed a statistically significant improvement in pain relief compared to a leading viscosupplement.

Bone Therapeutics’ core technology is based on its cutting-edge allogeneic cell therapy platform with differentiated bone marrow sourced Mesenchymal Stromal Cells (MSCs) which can be stored at the point of use in the hospital. Currently in pre-clinical development, BT-20, the most recent product candidate from this technology, targets inflammatory conditions, while the leading investigational medicinal product, ALLOB, represents a unique, proprietary approach to bone regeneration, which turns undifferentiated stromal cells from healthy donors into bone-forming cells. These cells are produced via the Bone Therapeutics’ scalable manufacturing process. Following the CTA approval by regulatory authorities in Europe, the Company has initiated patient recruitment for the Phase IIb clinical trial with ALLOB in patients with difficult tibial fractures, using its optimized production process. ALLOB continues to be evaluated for other orthopedic indications including spinal fusion, osteotomy, maxillofacial and dental.

Bone Therapeutics’ cell therapy products are manufactured to the highest GMP (Good Manufacturing Practices) standards and are protected by a broad IP (Intellectual Property) portfolio covering ten patent families as well as knowhow. The Company is based in the BioPark in Gosselies, Belgium. Further information is available at www.bonetherapeutics.com.

For further information, please contact:

Bone Therapeutics SA
Miguel Forte, MD, PhD, Chief Executive Officer
Jean-Luc Vandebroek, Chief Financial Officer
Tel: +32 (0)71 12 10 00
investorrelations@bonetherapeutics.com

For Belgian Media and Investor Enquiries:
Bepublic
Catherine Haquenne
Tel: +32 (0)497 75 63 56
catherine@bepublic.be

International Media Enquiries:
Image Box Communications
Neil Hunter / Michelle Boxall
Tel: +44 (0)20 8943 4685
neil.hunter@ibcomms.agency / michelle@ibcomms.agency

For French Media and Investor Enquiries:
NewCap Investor Relations & Financial Communications
Pierre Laurent, Louis-Victor Delouvrier and Arthur Rouillé
Tel: +33 (0)1 44 71 94 94
bone@newcap.eu

Certain statements, beliefs and opinions in this press release are forward-looking, which reflect the Company or, as appropriate, the Company directors’ current expectations and projections about future events. By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. These risks, uncertainties and assumptions could adversely affect the outcome and financial effects of the plans and events described herein. A multitude of factors including, but not limited to, changes in demand, competition and technology, can cause actual events, performance or results to differ significantly from any anticipated development. Forward looking statements contained in this press release regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. As a result, the Company expressly disclaims any obligation or undertaking to release any update or revisions to any forward-looking statements in this press release as a result of any change in expectations or any change in events, conditions, assumptions or circumstances on which these forward-looking statements are based. Neither the Company nor its advisers or representatives nor any of its subsidiary undertakings or any such person’s officers or employees guarantees that the assumptions underlying such forward-looking statements are free from errors nor does either accept any responsibility for the future accuracy of the forward-looking statements contained in this press release or the actual occurrence of the forecasted developments. You should not place undue reliance on forward-looking statements, which speak only as of the date of this press release.