• Funding will enable Appili to advance it’s Biodefense Vaccine Candidate ATI-1701 to IND

HALIFAX, Nova Scotia / May 08, 2023 / Business Wire / Appili Therapeutics Inc. (TSX: APLI; OTCQX: APLIF) (the “Company” or “Appili”), a biopharmaceutical company focused on drug development for infectious diseases and biodefense, today announced that the Company has executed the initial contract with the U.S. Air Force Academy (USAFA) for the previously announced funding of the ATI-1701 program. This contract represents the first stage of funding from the previously announced award from the U.S. Department of Defense (“DOD”). This initial funding, in the amount of US$7.3 million, will be used to kick-off ATI-1701 early-stage development and regulatory activities. As the initial activities progress, Appili will be engaging USAFA for additional tranches of funding to continue development through IND. ATI-1701, our biodefense vaccine candidate, is the Company’s potential first-in-class vaccine candidate for the prevention of infection with Francisella tularensis, the causative agent of tularemia and a top-priority biothreat.

“Successfully securing the first stage of funding from the DOD marks another exciting milestone for Appili and enables us to ramp-up our efforts to develop an urgently needed vaccine for this serious bioterrorism threat,” said Don Cilla, Pharm.D., M.B.A., President and Chief Executive Officer of Appili. “In addition to providing Appili with certain direct labor reimbursement and overhead recovery, this support is a clear indication of the importance of this program to the DOD and will further strengthen nonclinical, manufacturing and regulatory activities around ATI-1701, helping Appili deliver on our mission to address a variety of urgent unmet needs in infectious disease and biodefense”

Francisella tularensis has been classified as a Category A pathogen by the U.S. National Institutes of Health due to its high rates of infectiousness and ability to cause lethal pneumonia and systemic infection. As the transmission of Francisella tularensis in the aerosolized form is more infectious than anthrax, it is considered to be a high bioterrorism threat.

Earlier this year, the Company announced positive one-year results from its preclinical study evaluating the efficacy of biodefense vaccine candidate ATI-1701 in a lethal model of tularemia. In a 1-year NHP study, ATI-1701 exhibited significant efficacy at Days 28 and 90, with 100% of ATI-1701 vaccinated animals surviving a lethal aerosol challenge at Day 90, while no unvaccinated animals survived. The 1-year data demonstrates that a single vaccination with ATI-1701 can provide sustained protection. At the 1-year time point, there was a statistically significant improvement in survival in ATI-1701 vaccinated animals (n = 2/7) compared to mock vaccinated controls (n = 0/5). This positive one-year data, in addition to the significant efficacy demonstrated at earlier time points, well positions ATI-1701 to become the first approved vaccine for the prevention of tularemia. The study was funded by DTRA and conducted by MRIGlobal.

About USAFA Contract

USAFA is the prime contractor to DTRA for this program. Dr. Balboni, Assistant Professor and Director at the Life Sciences Research Center of USAFA is the principal investigator. The contract with USAFA establishes Appili as the top-tier performer, managing the development activities through IND. The anticipated total program funding amount is expected to be ~US$14 million, depending on U.S. federal budget funding activities, with the first tranche of US$7.3 million authorized with this contract. This, and other tranches of planned funding, are expected to advance the ATI-1701 program to an IND submission to the FDA in 2024.

About ATI-1701

Appili is developing ATI-1701 as a vaccine to combat Francisella tularensis, which is classified by the U.S. National Institutes of Health (NIH) as a Category A pathogen, an organism that poses the highest risk to national security and public health. Estimated to be 1,000-fold more infectious than anthrax, experts consider the aerosolized form to have a high potential for use in a bioterrorism attack.

About Appili Therapeutics

Appili Therapeutics is an infectious disease biopharmaceutical company that is purposefully built, portfolio-driven, and people-focused to fulfill its mission of solving life-threatening infections. By systematically identifying urgent infections with unmet needs, Appili’s goal is to strategically develop a pipeline of novel therapies to prevent deaths and improve lives. The Company is currently advancing a diverse range of anti-infectives, including a vaccine candidate to eliminate a serious biological weapon threat, a topical antiparasitic for the treatment of a disfiguring disease, and a novel easy to use, liquid oral formulation targeting parasitic and anaerobic infections. Led by a proven management team, Appili is at the epicenter of the global fight against infection. For more information, visit www.AppiliTherapeutics.com.

Forward-Looking Statements

This news release contains “forward-looking statements”, including with respect to the anticipated funding amount, the anticipated timing of such funding, the Company’s ongoing development plans and timeline with respect to ATI-1701. Wherever possible, words such as “may,” “would,” “could,” “should,” “will,” “anticipate,” “believe,” “plan,” “expect,” “intend,” “estimate,” “potential for,” and similar expressions have been used to identify these forward-looking statements. Forward looking statements contained in this press release are provided in reliance on certain assumptions, including with respect to the satisfaction of all conditions precedent to the advancement of the full anticipated funding (including receipt by DTRA of any requisite U.S. federal budget approvals, general development plans with respect to ATI-1701, general access to data required to support regulatory submissions, the nature and scope of the services to be provided by Appili to USAFA with respect to advancing the ATI-1701 program and the timing, scope and budget of additional contracts with USAFA). Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, the Company cannot give assurance that these expectations will prove to have been correct. Forward looking statements involve significant known and unknown risks, uncertainties and assumptions, including, without limitation, the risk that the final conditions governing the funding and the relationship between Appili and USAFA may not be satisfactory to the Company , the final funding amount may be different than that communicated herein (including as a result of the failure to secure the requisite US government budget approvals or the failure to secure additional contracts with USAFA on terms satisfactory to the Company or at all), receipt of funding may be delayed in the event that any remaining conditions are not satisfied in a timely manner, other standard risks associated with government grants and contracting of this nature and the other risk factors listed in the annual information form of the Company dated June 23, 2022 and the other filings made by the Company with the Canadian securities regulatory authorities (which may be viewed at www.sedar.com). Should one or more of these risks or uncertainties materialize or should assumptions underlying the forward-looking statements prove incorrect, actual results, performance or achievements may vary materially from those expressed or implied by the forward-looking statements contained in this news release. These factors should be considered carefully, and prospective investors should not place undue reliance on the forward-looking statements. The Company disclaims any intention or obligation to revise forward-looking statements whether as a result of new information, future developments or otherwise, except as required by law.