At the forefront of cancer immunotherapy - viralytics.com · KEYNOTE-200 KEYTRUDA ... Combination CAVATAK® and KEYTRUDA® - single arm trial Lead investigator Dr Ann Silk MD, Rutgers

At the forefront of

cancer immunotherapy

Investor Presentation

January 2018

1

Investment highlights

Lead investigational product

CAVATAK® kills cancer cells

with a bio-selected form of the

common cold virus

Used in combination to

enhance existing

blockbuster drugs

Global support from big

pharma, leading healthcare

investors and key opinion

leaders

Market-leading body of

clinical evidence, multiple

target areas, excellent

safety profile

Multiple value inflection

points including near-term

milestones

Excellent preliminary

results, three ongoing

clinical trials, >250 patients

have received CAVATAK®

page 2

Viralytics at a potential value inflection point, with

multiple pathways to realise value of CAVATAK®

Discovery Demonstrate efficacy Maximise asset value

Primary commercial focus

▪ A bio-selected

strain of the

common cold

virus

(CAVATAK®)

was found to be

effective in

killing cancer

cells in pre-

clinical studies

▪ Clinical trials demonstrate

effectiveness standalone,

and in combination with

other immunotherapy drugs

▪ Preliminary focus was on

melanoma via

intratumoural

administration

▪ Program expansion to intravenous administration,

and multiple high-need target areas, to demonstrate

broad applicability of CAVATAK®

▪ Broad applicability expected to lead to increased

market potential, and increase in number of

potential pharma partners

▪ Viralytics to progress the most advanced

opportunities to a potential pivotal study

page 3

RAPID MARKET

SHARE GROWTH

Immunotherapy expected to grow to 50% of

the total cancer treatment market by 20201

“HOT” SECTOR

FOR M&A

$16.6b immuno-oncology deal value2,

greater than all other oncology combined

Viralytics is making excellent progress in the

exciting sector of cancer immunotherapy

TRADITIONAL TREATMENTS

such as chemotherapy and radiotherapy

haven’t changed much since the 1950’s

IMMUNOTHERAPY is cutting edge,

and uses the body’s own immune

system to kill cancer cells

1: IMS Health

2: Defined Health Insight series 2016 page 4

Our lead drug CAVATAK® is a bio-selected form

of the common cold virus that kills cancer cells

ADMINISTRATIONMultiple routes

maximise applicability

Intravenous

Intratumoural

Intravesical

CAVATAK® kills cancer cells and stimulates the patient’s immune response

Binds externally

to tumour cell

Infects cancer

cell

Replicates and

destroys cell

CAVATAK® is released from

tumour, and the process repeats

Stimulates patient’s

own immune response

against the cancer

throughout the body

page 5

CAVATAK® is at the forefront of combination therapies,

the future of cancer treatment

▪ Combination immunotherapies aim to dramatically improve cancer survival rates over time

▪ Big Pharma is racing to find the most effective combinations

RECENT ADVANCES 2011-2017

Checkpoint inhibitors the first

immunotherapies to achieve FDA approval

CURRENT GOAL

Combination therapies(e.g. Viralytics’ CAVATAK® in combination with Checkpoint Inhibitors)

STANDARD OF CARE (SINCE THE 1950’S)

Chemotherapy / radiotherapy

% S

urv

iva

l

100

Time0

Chemotherapy,

radiotherapy

Standalone

immunotherapy

Combination

immunotherapy

“There is a lot of room to improve if we do come up with the right combination. That’s the

future. We are only at chapter one in the book of immunotherapy.”

Dr. Israel Lowy, Vice-president, Regeneron (leading Biotechnology company)

page 6Note: Graphic shown is not to scale, for illustrative purposes only

Why are we combining with them?CAVATAK® can ‘heat’ tumours, making them a more attractive and easier

target for checkpoint inhibitors so they can be more effective at fighting cancer.

CAVATAK® is an oncolytic virus that is a bio-selected form of the

common cold and kills cancer cells

CAVATAK® in combination with checkpoint inhibitors

has the potential to be the new standard of care

Checkpoint inhibitors are at the forefront of immunotherapy.

Over ~$6b of sales in 2016

Big-pharma have checkpoint inhibitors

in the market, including:

What is a checkpoint inhibitor?Checkpoint inhibitors are antibodies that stimulate the immune system

to attack cancer cells.

“CAVATAK® is not genetically

modified and we believe has the

differentiation of allowing multiple

routes of administration

(intravenous, intratumoural and

intravesical). We believe this opens up

a much broader opportunity for the

product in multiple tumour types.”

Roth Capital

page 7

Response rates in

patients with

advanced

melanoma:

Data sourcePublished data

(FDA approved label)

Ongoing clinical trials

(single-arm)1

Published data

(FDA approved label)

Ongoing clinical trials

(single-arm)1

Key information

Encouraging early results from ongoing clinical trialsData shown is preliminary, based on ongoing single-arm Phase 1 trials. CAVATAK is an investigational drug

CAVATAK® with KEYTRUDA® (CAPRA trial)

compared to published KEYTRUDA® data

CAVATAK® with YERVOY® (MITCI trial)

compared to published YERVOY® data

page 8

1. Response rates shown are preliminary and based on in-progress Phase 1b clinical studies

2. Merck is known as MSD outside USA and Canada

3. Evaluate EP Vantage 2018 Preview

4. Bloomberg average via FiercePharma

YERVOY® +

CAVATAK®KEYTRUDA® +

CAVATAK®

YERVOY® owned by

~$1.5b sales in 20183

KEYTRUDA® owned by

2

~$6b sales in 20183

Trial name: MITCI

Preliminary but

encouraging response

rates, versus published

YERVOY® alone4

Trial name: CAPRA

Preliminary but

encouraging response

rates, versus published

KEYTRUDA® alone4

Key Statistics

Ticker Code ASX: VLA

OTCQX: VRACY

Share Price

(as at 5-Jan-18)A$0.82

Market Capitalisation

(as at 5-Jan-18)A$226M

Trading Range

(12-month)A$0.59 – 1.34

Institutional and Pharma

investors 59%

Cash position

(31 Dec 17 pro forma)1 A$57M

Net operating cash burn

(Calendar 2017)A$16.4M

1 Includes $29.6 million investment and $6.4 million R&D tax incentive received since 31 December.

Company Location Comments

Leading diversified life sciences

company

Private investment firm specialising in public biotechnology investments

Financial services company with over

$1.5tn in assets under management

Healthcare-dedicated investment firm

which manages over $14bn

Independent, trans-atlantic bio-science

investment firm

Australian equities investment manager

CAVATAK® has received capital markets

validation, with strong institutional investor support

page 9

CAVATAK® has received scientific validation,

with podium positions at leading conferences

The world's oldest and largest professional association related to cancer research

Leading cancer research meeting, attended by oncology experts from around the world

World’s leading member driven organisation specifically dedicated to cancer immunotherapy

page 10

Multiple CAVATAK® target areas maximise potential

value, partnerships and paths to commercialisation

MELANOMA

6th most common cancer

Clinical trials completed

Further underway

Pivotal trial protocol

in development

HEAD & NECK

Broad range of cancers

Clinical trial in planning

BLADDER

5th most common cancer

Clinical trial underway

COLORECTAL

4th most common cancer

Clinical trial in planning

LUNG

2nd most common cancer

Clinical trial underway

Initial focus

Current focus, to demonstrate

broad applicability of CAVATAK®

in common cancer types

New high potential focus areas

Source: USA National Cancer Institute, 2016 page 11

Viralytics is building a market leading

body of clinical evidence on CAVATAK®

ProgramCombination

drug1 TargetProgress

HighlightsPre-clinical Phase I Phase II

CAPRA KEYTRUDA®

Melanoma

Well tolerated with encouraging initial

efficacy data: 61% best overall

response rate

(Published KEYTRUDA® alone3 is 33%)

MITCI YERVOY®

Melanoma

Well tolerated with encouraging initial

efficacy data: 57% best overall

response rate

(Published YERVOY® alone3 is 11%)

KEYNOTE-

200KEYTRUDA®

Lung, bladder

Part A (CAVATAK® alone) completed

successfully, Part B underway in

collaboration with Merck2; encouraging

initial positive signals of activity

CALMNA -

standalone

Melanoma

Efficacy exceeded expectations with

overall response rate of 28% in advanced

disease patients.

CANONMitomycin

(chemotherapy)

Bladder cancer

CAVATAK® was well tolerated with

promising results underpinning strong

potential in combination with checkpoints

Phase Ib

26/50 patients enrolled

Phase Ib

38/60 patients enrolled

Phase Ib

64/90 patients enrolled

Phase II

COMPLETE, 70 patients

Phase I

COMPLETE, 16 patients

1. In combination with CAVATAK®

2. Merck known as MSD outside USA and Canada

3. FDA approved label data page 12

Note: Summary information only – see Viralytics website for further details

Encouraging positive outcomes in

melanoma patients

CAPRAPhase 1b

Target area Melanoma

Administration Intratumoural

Combination CAVATAK® and KEYTRUDA® - single arm trial

Lead investigator Dr Ann Silk MD, Rutgers Institute of New Jersey

TRIAL OVERVIEW

Progress26 out of 50

patients enrolled

Upcoming

milestones

Clinical updates in Q2

2018

CLINICAL RESULTS

▪ Best Overall Response Rate of 61% (14/23 pts) and DCR of 78% (18/23 pts)

▪ Tumour responses are ongoing at 12 months in 6 patients

▪ 4 patients have demonstrated complete responses in the target lesions

▪ Best Overall Response Rate of 64% (7/11 pts) in patients with late stage IV M1c disease

▪ Reductions in a number of injected and non-injected visceral / non-visceral lesions

▪ Only two Grade 3 pembrolizumab-related adverse events in 26 enrolled patients

page 13

▪ Overall Response Rate of 61% for CAVATAK® / KEYTRUDA® combination

▪ Preliminary but encouraging response rates, versus published KEYTRUDA® alone1 (33%)

CAPRAPhase 1b

Encouraging preliminary response rates for

CAVATAK® + KEYTRUDA® combination

Best percentage change in target lesions irRC criteria(Preliminary data, investigator assessed)

14 of 23 patients (61%)

demonstrated >50% reduction

in sum of target lesions

*Prior ipilimumab treatment

Source: 1FDA approved label datapage 14

Disease stage

Each bar represents 1 patient

Impressive Evidence of Reduction in

Target Lesions

Stage IVM1c Partial response

Non-injected lung lesion upper left lobe

Baseline Day 197

Day 113

Stage IIICPartial response

Non-injected lymph node lesion Right internal

Obturator region

Baseline

CAPRAPhase 1b

page 15

Note: Summary information only – see Viralytics website for further details

Source: 1FDA approved label data

Encouraging positive outcomes in

melanoma patients

MITCIPhase 1b

Target area Melanoma

Administration Intratumoural

Combination CAVATAK® and YERVOY® - single arm trial

Lead investigator Dr Brendan Curti MD, Providence Cancer Center, Portland

TRIAL OVERVIEW

Progress38 out of 60

patients enrolled

Upcoming

milestones

Clinical updates in Q2

2018

CLINICAL RESULTS

Safety:

▪ No dose-limiting toxicities reported

▪ Six Grade 3+ adverse events in 4 patients (all YERVOY-related: fatigue, elevated liver enzymes [2], pruritis,

dehydration, hyperglycaemia) with an overall study Gr 3+ treatment-related AE rate of 11% (4/38 pts)

Efficacy:

▪ 57% (8/14) Best overall response rate in patients naïve to checkpoint therapy

▪ 29% (2/7) Best overall response rate in patients administered prior single line anti-PD1 therapy

▪ Preliminary but encouraging response rates, versus published YERVOY alone1 (11%)

page 16

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* irRC criteria: Preliminary data, investigator assessed+ First response assessment at Day 1061FDA approved label data

Preliminary but encouraging results, compared to published YERVOY® alone1 (11% response rate)

Encouraging preliminary response rates for

CAVATAK® + YERVOY® combination

MITCIPhase 1b

Checkpoint therapy naïve (n=14)

Overall response rate of 57%

Prior single line anti-PD-1 therapy (n=7)

Overall response rate of 29%

2 of 7 patients (29%)

demonstrated >50%

reduction in sum of

target lesions

page 17

8 of 14 patients (57%)

demonstrated >50%

reduction in sum of

target lesions

Each bar represents 1 patient Each bar represents 1 patient

Disease stage Disease stage

Impressive Evidence of Reduction in Target

Lesions in patients with advanced melanoma

MITCI Phase 1b

Complete response

demonstrated

Prior treatments include

BCG and Nivolumab

MITCI Phase 1b

Partial response

demonstrated

Prior treatments include

Ipilimumab/Nivolumab,

Nivolumab, Surgery

Pre-treatment Day 90 Day 180

Pre-treatment Day 127 Day 310

MITCIPhase 1b

page 18

Exciting trial in collaboration with Merck, in

high-potential target areas (lung and bladder)

KEYNOTE-200Phase 1b

WHY IS THE KEYNOTE-200 TRIAL

SO IMPORTANT?

▪ KEYNOTE-200 tackles two of the

five most common cancer types in

the US – Lung and Bladder

▪ Efficacy via intravenous

administration would massively

broaden the possible market and

potential pharma partners for

CAVATAK®

Target area Non-small cell lung cancer (NSCLC), Bladder cancer

Administration Intravenous

Combination CAVATAK® and KEYTRUDA® - single arm trial

Lead sites Memorial Sloan Kettering (USA),

Royal Surrey County Hospital (UK)

TRIAL OVERVIEW

Progress64/90 patients. 17 sites in

US, UK & Aus. recruiting

Upcoming

milestones

Clinical updates in Q2

2018

CLINICAL RESULTS

▪ Similar adverse event profile when compared

to KEYTRUDA alone

▪ Of 28 evaluable patients, response observed

(not all yet confirmed) in 3 of 10 (30%) NSCLC

and 5 of 18 (28%) metastatic bladder cancer

patients. 12 of these 28 patients currently

remain on the study

page 19Note: Merck known as MSD outside of USA and Canada

Encouraging data+ in lung and bladder cancer

patients treated with CAVATAK® + KEYTRUDA®

KEYNOTE-200Phase 1b

Response observed (not all yet confirmed)

in 3 of 10 (30%) NSCLC and 5 of 18 (28%)

metastatic bladder cancer patients *

page 20

Each bar represents 1 patient

Key players are acquiring immunotherapy companies

in a similar development stage to Viralytics

2017 Acquisition

US$554mPhase I/II

2016 Acquisition

US$400mPre-clinical

2016 Acquisition

US$400mPre-clinical

2016 Acquisition

US$1.7bnPhase II

2017 License

US$2.8bnPhase I/II and below

2016 License

US$200mPre-clinical

“As a leading innovator in the field of

immuno-oncology, Merck is dedicated to

advancing breakthrough science”

Eric Rubin, MD Oncology Early-stage

“Combination therapy will be foundational to

delivering the potential for long term

survival for patients”

Francis Cuss, Chief Scientific Officer

page 21Note: Merck known as MSD outside of USA and Canada

Viralytics has enviable optionality,

with multiple value realisation pathways

Continue to progress clinical

development, to achieve

value inflection of CAVATAK®

Realise value via licensing

and milestone revenues

DEVELOP INDEPENDENTLY

PARTNER WITH BIG PHARMA

LICENSE A TARGET AREA

SALE OF COMPANYRecognise equity upside

potential through M&A

Viralytics is actively pursuing the most value-accretive pathways

page 22

Viralytics has three main clinical goals for 2018

1. Progress melanoma programme into a pivotal study

RELEVANT CLINICAL TRIAL: MITCI

2. Demonstrate large addressable market through intravenous use of

CAVATAK® in very large indications: lung and bladder cancer

RELEVANT CLINICAL TRIAL: KEYNOTE-200

3. Highlight broad potential through signal seeking studies in head and

neck cancer, colorectal cancer and ocular melanoma

FOUR NEW STUDIES TO BE INITIATED IN 2018

1

2

3

page 23

Disclaimer

Certain statements made in this presentation are forward looking statements within the meaning of the safe harbour

provisions of the United States Private Securities Litigation Reform Act of 1995. These forward looking statements are not

historical facts but rather are based on Viralytics’ current expectations, estimates, assumptions and projections about the

industry in which Viralytics operates. Material referred to in this document that use the words ‘estimate’, ‘project’, ‘intend’,

‘expect’, ‘plan’, ‘believe’, ‘guidance’ and similar expressions are intended to identify forward looking statements and should

be considered an at-risk statement. These forward looking statements are not a guarantee of future performance and

involve known and unknown risks and uncertainties, some of which are beyond the control of Viralytics or which are

difficult to predict, which could cause the actual results, performance or achievements of Viralytics to be materially different

from those which may be expressed or implied by these statements. These statements are based on our management’s

current expectations and are subject to a number of uncertainties and risks that could change the results described in the

forward-looking statements. Risks and uncertainties include, but are not limited to, general industry conditions and

competition, general economic factors, the impact of pharmaceutical industry regulation and health care legislation in the

United States and internationally, and challenges inherent in new product development. Investors should be aware that

there are no assurances that results will not differ from those projected and Viralytics cautions shareholders and

prospective shareholders not to place undue reliance on these forward-looking statements, which reflect the view of

Viralytics only as of the date of this presentation. Viralytics is not under a duty to update any forward-looking statement as

a result of new information, future events or otherwise, except as required by law or by any appropriate regulatory

authority.’

page 24