MGL-3196,aThyroidHormoneReceptor-βagonist,fortheTreatmentofNASH

NASHTAG2018

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Anystatements,otherthanstatementsofhistoricalfacts,madeinthispresentationregardingourfuturefinancialorbusinessperformance,conditions,plans,prospects,trends,orstrategiesandotherfinancialandbusinessmatters;ourabilitytoobtainadditionalfinancing;theestimatedsizeofthemarketforourproductcandidates,thetimingandsuccessofourdevelopmentandcommercializationofouranticipatedproductcandidates;andtheavailabilityofalternativetherapiesforourtargetmarket,are,ormaybedeemed,forward-lookingstatementswithinthemeaningofthePrivateSecuritiesLitigationReformActof1995.Insomecases,youcanidentifyforward-lookingstatementsbytermssuchas“may,”“will,”“could,”“should,”“would,”“anticipate,”“believe,”“estimate,”“continue,”“design,”“expect,”“intend,”“plan,”“potential,”“predict,”“seek”orthenegativeofthesewordsandsimilarexpressionsandtheirvariantsmayidentifyforward-lookingstatements.

Theseforward-lookingstatementsreflectmanagement’scurrentexpectations,arebasedoncertainassumptionsandinvolvecertainrisksanduncertainties,whichchangeovertime.Ouractualresultsmaydiffermateriallyfromtheresultsdiscussedintheseforward-lookingstatementsduetovariousfactors.Importantfactorsthatmaycauseactualresultstodiffermateriallyfromtheresultsdiscussedintheseforward-lookingstatementsinclude,butarenotlimitedto,risksrelatedtosecuringandmaintainingrelationshipswithcollaborators;risksrelatingtoourclinicaltrials;risksrelatingtothecommercialization,ifany,ofourproposedproductcandidates(suchasmarketing,regulatory,productliability,supply,competition,andotherrisks);dependenceontheeffortsofthirdparties;dependenceonintellectualproperty;andrisksrelatedtoourcashresourcesandabilitytoobtainworkingcapitaltofundourproposedoperations.Furtherinformationregardingonthefactorsthatcouldaffectourbusiness,financialconditionsandresultsofoperationsarecontainedourfilingswiththeU.S.SecuritiesandExchangeCommission,whichareavailableatwww.sec.gov.Theseforward-lookingstatementsrepresentmanagement’sexpectationsasofthedatehereofonly,andwespecificallydisclaimanydutyorobligationtoupdateforward-lookingstatementsasaresultofsubsequenteventsordevelopments,exceptasrequiredbylaw.

ForwardLookingStatements

Pipeline: MadrigalMGL-3196Phase2StudiesinNASHandFH

Compound Indication Pre-Clinical Phase1 Phase2 Phase3 Upcoming

MGL-3196Thyroid HormoneReceptor-β (THR-β)Agonist

NonalcoholicSteatohepatitis(NASH)

n Phase2liverbiopsydata

n Phase3initiation

FamilialHypercholesterolemia

(FH)

n ToplinePhase2data

n Phase3initiation

MGL-3745THR-β Agonist

NASHandFH

3

MadrigalisfocusedonthedevelopmentofitspipelineofTHR-β agonistsforthetreatmentofNASHandFamilialHypercholesterolemia(FH)

MechanismofAction: TheImportanceofLiverTHR-βinNASH

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Thyroid Gland

Liver T4è T3

T4 T3

Nuc

Thyr

oid

Horm

one

Rece

ptor

α o

r β

TSH

Thyroid Hormone Pathway

T4

T4,prohormoneT3,ac/vehormoneTSH,thyroids/mula/nghormone

ê LowersLDL-cholesterolê Lowerstriglyceridesê Lowersliverfat,potentially

reducinglipotoxicity,NASH

Nothyrotoxicosis(THR-αeffect)

InhumansTHR-β agonism:

nUnlikeotherpathwayswhichraiseLDL-cholesterol(FXR,FGF-19)ortriglycerides(ACC1antagonist),THR-βagonism reducesbothplasmatriglyceridesandLDL-cholesterolandmayprovideCVbenefittoNASHpatients

WebelievethatMGL-3196,aselectiveTHR-βagonist,willtreattheunderlyingdiseaseinNASHpatients

Lipotoxicity MaybeReducedbyTHR-β Agonists

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n Mosthepaticfatderivesfromexternalsources,particularlyfreefattyacidsfromadipocytes

n InNASH,β-oxidationofliverlipidsisreducedcontributingtolipotoxicity

n THR-βagonistsreduceliverfatthroughbreakdownoffattyacids,andstimulatemitochondrialbiogenesisintheNASHliver,thus,webelieve,reducinglipotoxicity andimprovingliverfunction

n InhumanNASH,theliverishypothyroid,exacerbatingmitochondrialdysfunctionandlipotoxicity

n WebelieveMGL-3196haspleiotropiceffectscharacteristicofan“ideal”NASHdrug,withpotentialforaddressingtheunderlyingmetabolicsyndromeandhallmarkfeaturesofNASH:steatosis/lipotoxicity,inflammation,ballooning,fibrosis(bothdirectlyandindirectly)

β-oxidationoffatinmitochondria

Sinha andYenCellBiosci (2016)6:46DOI10.1186/s13578-016-0113-7;Autophagy,11:8,1341-1357,DOI:10.1080/15548627.2015.1061849

THR-βAgonism:PotentialAnti-FibroticActions

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n TreatingNASH,ratherthanfibrosis,iskeytoaddressingthedisease

• ResolutionofNASH,withoutreducingfibrosis,isanapprovableendpoint

• RecognitionthatliverfibrosiswilldecreasewithtimeafterNASHresolves(similartoreductionoffibrosisastheliverregeneratesaftercureofHCV)

n THR-β,theoperativereceptorinhepatocytes,mayamelioratelipotoxicity andresultantlocalinflammationwhichleadtohepatocytedysregulationandapoptosis.Theseperturbationsleadtoaprofibrotic environmentthrough:

• Ongoinginflammation;

• Productionbythedysregulated/damaged/dyinghepatocytesofprofibrotic factors,withTGF-βamongthemostimportant

n THR-βmayhavedirectanti-fibroticeffects

• Thyroidhormonereceptoragonism hasbeenshowntodampeninflammationinvivoandtoinhibitTGF-βsignalingincellcultureandinvivo

• Inanimalmodelsofliverfibrosis,theextentoffibrosisisdecreasedbythyroidhormoneadministrationandincreasedifthyroidhormonereceptorsareknockedout

PNAS113:3451,2016

MGL-3196,aFirst-in-ClassLiver-DirectedTHR- βAgonist

WebelieveMGL-3196isthefirstbonafideTHR-βselectivemoleculewithkeyadvantagesoverothercompanies’previousanalogues

n DiscoveryofMGL-3196andbackupsatRocheutilizedanovelfunctionalassaythatwentbeyondwhatpreviouscompanieshaddone(simplereceptorbindingassay)

• Earliercompoundsfromothercompanies,purportedtobeTHR-βselective,shownofunctionalselectivityinthisassayand,likethyroidhormone,activatetheTHR-αreceptorequallywellastheβreceptor

n invivo dataconfirmMGL-3196’shighliveruptakeandpreclinicalsafety

• Avoidsactivityat thesystemicTHR-αreceptor(increasedheartrate,osteoporosis)• Unlikeothercompany’searlierthyroidreceptoragonists,nocartilagefindingsinchronictoxicologyorliverenzymeincreasesin

humanstudies• Testedinmorethan135subjectsinPhase1studiesand150patientsinPhase2studies• OngoingPhase2dosinginhumansincludes9monthsoftreatmentinhumanswithNASH

JMedChem.2014;57(10):3912-3923

lessαpotentè

çmoreßselectiveα-potency(nM)

β/αrelativetoT3

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Thyroid Hormone (T3) MB07811 (GC1)

MGL-3196 EprotiromeKBGC-1

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MGL-3196:RadiographicTissueDistribution

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n MGL-3196ishighlyproteinbound(>99%)andistakenupintotheliverbyhepatictransporters

n Theprimaryrouteofeliminationafteranoraldoseof[14C]MGL-3196inratsanddogsisthefecesviabiliaryexcretion

n Uptakewaslowtoundetectableinheart,boneandbrain,furthersupportingthesafetyofMGL-3196

0 5 10 15 20 25

Bone(femur)BoneMarrow

Brain(cerebellum)Brain(cerebrum)Brain(medulla)PituitaryGland

HeartSkeletalMuscleKidney(cortex)

Kidney(medulla)Liver

RatiotoBlood

MGL-3196:Inactiveininvivo HeartStudies

• Hypothyroidratstreatedwithcompoundfor6hrs• hnRNA isolatedandα-MHCquantifiedbyRT-PCR• ResultsrelativetoT3• ExposureMGL-3196:5mg/kgat6hr:15.4uM;20mg/kgat6hr:57uM;37.5mg/kgat6hr:94uM

9 1/5/18

n InvivoassessmentofmarkerofTHR-αactivityintheheart

n THR-αsignalfromT3(control)andputativeTHR-β analoguesdemonstratesheartpenetrationandconfirmslackoffunctionalTHR-βselectivity

n MGL-3196istheonlynegativeanalogue,evengivenatveryhighdoses

• Confirmsselectivityandlackofheartpenetration

• Noadverseheartfindingsreportedinefficacyortoxicologystudies(histopathology)

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MGL-3196:ImprovedSafetyProfileRelativetoT3

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SignificantlyreducedbonemineraldensitywithT3

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T3

MGL-3196

Thyroidhormone(T3,thyroxine)treatmentmaycauseosteoporosis

24d study in 40 week old diet-induced obese (DIO) mice on High Fat Diet (HFD) for 38 weeks

BMJ2011;342:d2238 1/5/1810

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MGL-3196 3 mg/kg Rosiglitazone: 10 mg/kg

MGL-3196:DataSupportsImprovementinLiverHealth

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Upper panels: 24d study in 17 wk old DIO mice (po, qd) on high fat diet (HFD) 13 wks; lower panels: 24d study in 40 wk old DIO mice on HFD 35 wks

LiverSize

** ***

MGL-3196

***

**

LiverTriglycerides

*** p<0.001 ** p<0.01* p<0.05

LiverFat(Histology)

InsulinToleranceTest(0.5U/kginsulin)

*

***

* p<0.05

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IU/L

Control MGL-3196 .3mg/kg

MGL-3196 1mg/kg MGL-3196 3mg/kg

MGL-3196 10mg/kg

ALT

*** ****** ***

MGL-3196§ Reducedhepatic

triglycerides(>50%),normalizedliversize

§ Insulinsensitivityimprovedatalldoses

§ Reducedliverenzymes(ALT,AST)

§ Improvedliverhistology,reducedNASHscore

Control

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NormalizationofHepaticGeneExpressioninLong-termHFDMice

§ 25weektreatmentwithHFDchangesthehepaticexpressionofalargenumberofgenetranscripts,includingbothincreased(red)anddecreased(blue)expression

§ TreatmentwithMGL-3196atdosescomparabletohumandosesnormalizeshepaticgeneexpressionaswellashepaticarchitectureandsizewithoutaffectingbodyweight

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HFD 0.1 0.3 1 3 Rosi MGL-3196 (mg/kg)

MGL-3196:ReductionofKeyNASH,FibrosisPathwayGenesatHumanComparableDrugLevels

TIMP1 tissue inhibitor metalloproteinaseCTGF connective tissue growth factorSMA smooth muscle actinSAA serum amyloid ACRP C-reactive protein

“HFD”,lane1meanHFDgeneexpressionnormalizedtomeanLean;Lanes(2-7)meangeneexpressionnormalizedtomeanofDIO;“Rosi”(rosiglitazone,3mg/kg,24wks)Red,higherexpression;bluedecreasedexpression

Inflammation HFD Lean 0.1 0.3 1 3 RosiMCP-1/CCL2MIP-2α/CXCL2MIP-2ß/CXLCL3A20/TNFaip3CRPAnnexin 2SAA1FibrosisCollagen 1Galectin-3TIMP1Collagen 4a2SMACollagen 4a1CTGFKeratin 18Collagen 3Galectin-1

25weekstudyinleancontrolmiceandHFDmicetreatedwithVehicle,0.1to3mg/kgMGL-3196orRosiglitazone(3mg/kg)

Bad Good

1234567

MGL-3196(mg/kg)

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MGL-3196:Long-termDosinginHumansisEnabled

§ SingleAscendingDose(SAD)study

§ MultipleAscendingDose(MAD)study

§ Phase1studiesdosingMGL-3196withstatinsandmassbalancestudy

§ SeriesofGLPtoxicologyandCMCstudiessupportallindications• Manufacturingandproductformulation• Chronictoxicologypackage• Phase2-enabling

Atherosclerosis230(2013)373-380

Completed:

1/5/1814

Phase1:RobustLDLandTriglycerideLoweringEstablishedin14DayMultipleAscendingDoseStudy

Oncedailyoraltreatmentledtohighlystatisticallysignificantanddose-dependentupto~30%reductionofapolipoproteinB(ApoB),total,LDL,non-HDLcholesterol;Strongtrendsintriglyceridereductionupto60%;Nearmaximaleffectat80mgdose

ChangefromBaseline(CFB)bymean%CFBcalculatedforeachindividualsubject24hafter14thdose;baselinevalueobtainedjustpriortofirstdose;ApoB,apolipoproteinB;Chol,totalcholesterol;LDL-C,LDLcholesteroldirectlymeasured;Non-HDL-C,non-HDLcholesterol;TG,triglycerides(median%CFB)

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Chol LDL-C ApoB Non-HDL-C TG

%C

hang

e Fr

om B

asel

ine

MG

L-31

96,

Pla

cebo

Sub

trac

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Change in Lipids After 14 Days

5mg 20mg 50mg 80mg 100mg 200mg

*** p<0.001 ** p<0.01 * p≤0.05 “p≤0.1

******

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“

“

15Atherosclerosis230(2013)373-380

n Sixdosecohorts,36totalhealthyvolunteersdoseddailywithMGL-3196(5,20,50,80,100,or200mg)and12withplacebofor14days

n HealthyvolunteerswithslightlyelevatedLDLcholesterol(>110mg/dL)

n Well-tolerated,appearedsafeatalldosestested

n Noeffectonvitalsigns,heartrate,centralthyroidaxis,orliverenzymes

Phase2:MGL-3196TrialDesignisTargetedatHighlyRelevantPrimaryandSecondaryEndpoints

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Inclusion/Exclusion

n NASHonliverbiopsy:NAS≥4withfibrosis

n ≥10%liverfatonMRI-PDFF

n Includediabetics,statintherapy

Comparator/Arms

n MGL-3196orPlacebo,oncedaily

PrimaryEndpoint

n Reductionofliverfat(MRI-PDFF)at12weeks

SecondaryEndpoints

n NASHbiomarkersandlipidsat12,36weeks

n RepeatMRI-PDFFat36weeks

n Liverbiopsyat36weeks- reduction/resolutionofNASHinpatientsondrug;reductionoffibrosis

Design

Stage

Drug n MGL-3196

n Blinded2:1

n Phase2

NumberofPatients

Centers

TreatmentDuration

n 125,FullyEnrolled

n ~30,USA

n 36Weeks

StudyOverview StudyDetails

NASHPhase2Demographics

Baseline Demographics

n 125

Meanage 50.4

Gender - n (%)

Female 63(50.4)

Male 62(49.6)

Ethnicity - n (%)

NotHispanicorLatino 66(52.8)

HispanicorLatino 59(47.2)

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NASHPhase2BaselineCharacteristics

BaselineBMI (kg/m²) 35.07(mean)

Type2diabetesn(%) 44(35.2)

Hypertension n(%) 37(29.6)

Triglycerides 172.0(mean)

MRI-PDFF 20.17%FF(mean)

NAS at Screening 4.9(mean)

Fibrosis score - (%)

1A,B 56%

2/3 43%

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§ NASscoreofatleast4,range4-8andfibrosis1-3

Phase2:MGL-3196StudyAchievedPrimaryEndpointinInterimReadout

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ALLMGL-3196

HIGHMGL-3196¹

Placebo

Numberofpatients 78 44 38

PrimaryEndpoint:RelativechangeinMRI-PDFF(%changefrombaseline,median)Significancerelativetoplacebo

-36.3%

p<0.0001

-42.0%

p<0.0001

-9.6%

Percentageofpatientsattaining≥30%liverfatreductionSignificancerelativetoplacebo

60.3%

p<0.0001

75.0%

p<0.0001

18.4%

n Statisticallysignificantimprovementsinlow-densitylipoproteincholesterol(LDL-C),triglyceridesandlipoprotein(a)Lp(a)²

n Statisticallysignificantimprovementsinliverenzymesindrug-treatmentgroup²

n Verygoodallsubjecttolerability:mostlymildandafewmoderateAEs,thenumbersofwhicharebalancedbetweenplaceboanddrug-treatedgroups;3reportedSAEsallconsideredunrelatedtodrug

n TworegularlyscheduledDSMBmeetingsheldMay2017andSeptember2017toreviewdatafromtheMadrigalNASHPhase2trial.DSMBrecommendedtocontinuethetrialwithnochangestotheprotocol

¹Prespecified groupofpatients(44/78)withrelativelyhigherMGL-3196druglevels²Thesebeneficialeffectsaremorepronouncedinthegroupofpre-specifiedpatientswith

higherlevelsofMGL-3196Ther.Adv.Gastroenterol.2016;9:692-701

n GrowingclinicaldatasetdemonstratingcorrelationbetweendeclineinfatcontentonMRI-PDFF,fibrosisbiomarkersandNASscoreonbiopsy

CompetitivePosition:MGL-3196isDifferentiatedintheNASHLandscape

n Potentialpleiotropicandcardio-beneficialactionspositionMGL-3196asstandaloneNASHtherapeutic

n OpportunitiesfordifferentiationfromotherNASHagents

n EfficacyonNASHandcardiovascularendpointsprovideopportunityforMGL-3196tobeusedincombinationwithanti-fibroticand/oranti-inflammatoryagents

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Targetcompound

NASScore

FibrosisScore LiverLipids

NASHPrevention

InsulinSensitivity LDL TGs

CVRisk SideEffects

FXR,FGF-19 ✔ ✔ ✔ ✔ ✔ é — éLDL-C Pruritus (BA)

Anti-fibrotic ? ✔ — ✖ — — — ? Unknown

PPARαδ ✔ ✖ — ? ✔ ê ê ? Well-tolerated

Anti-inflam ✔ ? — — — — — ? Well-tolerated

Pioglitazone ✔ ✔ ✔ ✔ ✔ ê ê PPAR CHF,êbone,éweight

MGL-3196 ✔ ✔ ✔ ✔ ✔ ê ê CVBenefit Well-tolerated

Lancet385:956-65;2015;GastroenterologyFeb112016;pii:S0016-5085(10)00140-2TobirapressreleaseJuly25,2016;AnnInternMed.doi:10.7326/M15-17742016

ExpectationsforDevelopmentTiming

ü Completionoflong-termtoxicologystudiesforMGL-3196

ü CompletionofPhase1trialofMGL-3196dosedwithstatinsforNASH

ü InitiationofPhase2trialofMGL-3196forNASH

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ü Initiationof12-weekPhase2trialofMGL-3196forHeFH

ü Positivetopline12-weekdatafromPhase2trialofMGL-3196forNASH

Upcoming:

n 36-weektoplineliverbiopsydatafromPhase2trialofMGL-3196forNASH

n ToplinedatafromPhase2trialofMGL-3196forHeFH

n Phase3NASH

n Phase3HeFH

CompletedMilestones:

2018+20172016

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Appendix:

AdditionalMaterial

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LipidLoweringinAdditionalPhase1Studies

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Baseline(BL);triglycerides(TG)(all)or>150mg/dL atBL;Lp(a)shownonlyforsubjectswithmeasurableBLLp(a)

p<.003p<.0001

• InPhase1studies,38healthyvolunteersweredosedwithone-twodaysofastatinandmultipledailydoses(9-11)ofMGL-3196(100or200mg)

• Robustlipidloweringwasobserved(upto60%LDL-C),subjectsreachinganaverageLDL-Cof70mg/dL,ApoB of59mg/dL

• ConsistentwithMADdata,subjectswithhigherMGL-3196exposuresdidnotdemonstratemorelipidlowering.

p=.001