Synairgen plc

Corporate Presentation

• Phase 2 trial in COPD planned for

Inhaled IFN-β

• LOXL2 inhibitor starting Phase1 Q4

By Richard Marsden, CEO

November 2017

1

The sole purpose (“the Purpose”) of this presentation (the “Presentation”) is to provide information on Synairgen plc (“Synairgen” or “the Company”) and its subsidiaries

(together “the Group”). This Presentation and the contents of it do not, and are not intended to, constitute an offer for sale, prospectus, invitation to subscribe for or

purchase or otherwise acquire, shares or other securities in the Company.

Verification of information

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or completeness of the statements contained herein. No representation or warranty whatsoever is given by or on behalf of Synairgen or any directors, officers,

employees or advisers or any other person and no responsibility or liability is accepted by any of them, in relation to the shares, business or prospects of the Company

expressed or implied, or with respect to the adequacy, accuracy, completeness or reasonableness of the facts, opinions, estimates, forecasts, projections or other

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or should be relied upon as a promise or representation as to the future. Any pro-forma and estimated financial information contained herein is prepared expressly for

use herein and is based on certain assumptions and the Directors’ analysis of information available at the time this Presentation was prepared. There is no

representation, warranty or other assurance that any of the projections will be realised. The information contained herein and any further information relating to the

Company supplied by Synairgen or its advisers is, and will be, supplied on the condition that neither Synairgen nor its advisers accepts any responsibility and/or liability

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risks, including dependence on core technology, fluctuations in results, dependence on new product development, rapid technological and market change, reliance on

sales by others, management of growth, dependence on key personnel; rapid expansion; financial risk management and future growth subject to risks. The Company

cautions recipients of this presentation not to place undue reliance on these forward-looking statements, which reflect the view of the Company only as of the date of

this presentation. The forward-looking statements made in this presentation relate only to events as of the date on which the statements are made. The Company will

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occurring after the date of this announcement except as required by law or by any appropriate regulatory authority.

Disclaimer

2

Synairgen overview

• Respiratory drug discovery and development company focused

on developing novel therapies, building on the success of the

academic team at the University of Southampton

• Strategy

o Use BioBank human tissue models technology platform to:

validate new drug targets and

screen new compounds

o De-risk early stage clinical trials through use of biomarkers

• Programmes

o Phase 2 trial in COPD planned for Inhaled IFN-β (SNG001)

o LOXL2 inhibitor for fibrotic diseases starting Phase 1 Q4

2

3

Respiratory disease - significant unmet medical need

Chronic Obstructive Pulmonary Disease (COPD)

• 25% of long-term smokers develop COPD

• Predicted to be 3rd leading cause of death in 2030

• Economic cost to USA c. $50bn pa

• Second most common cause of emergency admissions to hospital in UK

• 715,000 hospitalisations for COPD in USA in 2010

• Viruses implicated in 50% of exacerbations

Idiopathic Pulmonary Fibrosis (IPF)

• ‘Scarring’ of lung tissue reduces gas exchange in the lungs, median

survival 2 - 3 years

• IPF affects up to 132,000 people in the US

Technology platform and research approach

5

Mouse or human to research human disease?

• Can be genetically engineered

• Can be exposed to cigarette

smoke

• Can be manipulated to have

lung fibrosis

• Cells from patient volunteers

with and without disease

o Disease differences

maintained in cell culture

• Used to:

o Validate targets

o Screen and test new drugs

o Develop biomarkers to

confirm drug activity in

clinical trials

6

Specialised clinical research experience

• Access to state-of-the-art clinical trial site

o High quality trials conducted ‘in-

house’

• Clinical trial design and management/site

o Phase I and II

Multicentre

Multinational

• Study site for BioBank sample collection

• Regulatory experience

o MHRA Scientific Advice meetings

o Clinical trial approvals

o MHRA Inspection

o Licence from HTA

Research facilities at Southampton General Hospital

Facilities at Southampton General Hospital

Inhaled IFN-β

8

COPD

Without IFN- With IFN-0

5

10

15

20

Cell D

eath

Asthma

Without IFN- With IFN-

0

2

4

6

8V

iru

s R

ele

ase

IFN-β protects lung cells from asthma and COPD patients from respiratory

viruses that cause exacerbations.

Interferon-β (IFN-β) – the background

Synairgen repurposed (hence de-risked)

and reformulated IFN-β1a, developing

an inhaled form.

9

Clinical Trial Data: Phase I (SG004)

IP-10

Placebo 1.5MIU 6MIU0.1

1

10

100

Fo

ld c

han

ge f

rom

baselin

e

MxA

Placebo 1.5MIU 6MIU

Fo

ld c

han

ge f

rom

baselin

e 30

1

2'-5' OAS

Placebo 1.5MIU 6MIU1

10

Fo

ld c

han

ge f

rom

baselin

e

IP-10 ProteinF

old

ch

an

ge f

rom

baselin

e

Placebo 0.36MIU 1.5MIU 6MIU

 2

 8

16

32

 1

 4

Neopterin

Fo

ld c

han

ge f

rom

baselin

e

Placebo 0.36MIU 1.5MIU 6MIU

2

1

4

0.5

• SNG001 well tolerated in asthmatics

• Lung antiviral biomarker responses to inhaled SNG001

10

• Synairgen Phase II trial produced positive data in severe (BTS Step 4&5)

asthma patients when patients have a lower respiratory tract viral infection

(a cold)

• SNG001 was well tolerated by asthmatics when they had a virus infection

• Following the completion of this study, the programme was licensed to

AstraZeneca in 2014

Asthma Control

Ch

an

ge in

AC

Q-6

fro

m

Pre

-Tre

atm

en

t B

aselin

e

Placebo SNG001-0.5

0.0

0.5

1.0difference 0.63, p=0.004

No change

Clinicallyrelevantdifference

(n=30) (n=24)

Lung Function

Study dayC

han

ge in

Mo

rnin

g P

EF

R

(L

/min

)

2 3 4 5 6 7 8 9 10 11 12 13 14

-40

-20

0

20

40

60 Placebo

SNG001

No change

Clinicallyrelevantdifference

Clinical Trial Data: Phase II (SG005)

11

Clinical Trial Data: Phase II (INEXAS)• AstraZeneca’s asthma trial (INEXAS) started in July 2015, planning to treat

220 patients, but was stopped in October 2016 when an interim analysis

showed a very low exacerbation rate, meaning that the drug’s effects on

severe exacerbations could not be determined

• Enough patients had been dosed to enable analysis of secondary

endpoints: treatment with AZD9412 (SNG001) switched on markers of

antiviral defence in the lungs, improved morning peak flow (a measure of

lung function), and was well tolerated

• However the study did not meet AstraZeneca’s predefined criteria for

progression, and they returned the rights to AZD9412 and provided the

clinical data to Synairgen

• Data identifying the 48% of patients who had a confirmed virus infection and

had the potential to respond to treatment was provided in July.

• Synairgen conducted a further exploratory analysis, focussing on patients

with a confirmed virus infection who came from the more difficult to treat

asthma where we had seen efficacy in SG005

12

Clinical Trial Data: INEXAS Lung function

P la c e b o IF N -

0

2 0

4 0

6 0

8 0

1 0 0

Mo

rn

ing

PE

FR

AU

C

Da

ys

1-7

(L

/min

/da

y)

p = 0 .0 2 4

n = 5 4 n = 4 7

D iffe re n c e

2 0 L /m in /d a y

P la c e b o IF N -

0

2 0

4 0

6 0

8 0

1 0 0

Mo

rn

ing

PE

FR

AU

C

Da

ys

1-7

(L

/min

/da

y)

n = 1 9 n = 1 8

p = 0 .0 2 1

D iffe re n c e

3 9 L /m in /d a y

Whole population Virus positive and BTS Step 4/5

• Peak Expiratory Flow Rate (PEFR) was measured in the morning

• 20L/min is considered to be a clinically-relevant improvement

13

Clinical Trial Data: INEXAS Asthma Control

P la c e b o IF N -

-1 .0

-0 .5

0 .0

0 .5

1 .0

Ch

an

ge

in

AC

Q-6

fro

m

Pre

-Tre

atm

en

t B

as

eli

ne

p = 0 .0 3 2

n = 2 1 n = 1 6

D iffe re n c e

0 .4 9

P la c e b o IF N -

-1 .0

-0 .5

0 .0

0 .5

1 .0

Ch

an

ge

in

AC

Q-6

fro

m

Pre

-Tre

atm

en

t B

as

eli

ne

p = 0 .6 6

n = 4 9 n = 4 5

D iffe re n c e

0 .0 6 7

Whole population Virus positive and BTS Step 4/5

• ACQ is the Asthma Control Questionnaire

• Outcome is the change in ACQ during the first 7 days of treatment

• Clinically relevant change is 0.5 on the scale

14

Key new findings from the INEXAS trial

• Positive effects on lung function and asthma control in

virus-positive ‘difficult to treat’ patients; the same patient

classification in which we had found the positive signal in

SG005

• However, the unexpectedly low exacerbation rate

(<10%) in the INEXAS trial population suggests

economic viability in asthma limited

15

Why move into COPD?

• Scientific evidence

• IFN-β protects COPD cells from viruses which cause exacerbations

• Higher exacerbation rate

• The risk of exacerbation following a respiratory viral infection is

much greater in COPD (~50%) (asthma <10%)

• New Technology

• COPD exacerbations can be caused by other factors such as

bacterial infections

• Point of care virus test

o Result in one hour

o Patient selection possible for clinical trials – and the

marketplace

o ‘Unblocks’ COPD development route

16

Do exacerbations of COPD matter?

Exacerbations are the major drivers of healthcare expenditure on COPD

17

COPD clinical development plan

• Winter 2017/2018

– Part 1: 10 stable un-infected COPD patients: to confirm safety

& show upregulation of anti-viral biomarkers

Followed by:

– Part 2:

• 80 virus positive patient trial focussed on safety and

biomarkers of antiviral response and other endpoints

• 2019 to 2020

– Phase IIb

– 3 dose levels

New drug for lung/liver/kidney fibrosis scheduled to start Phase I trials in Q4 2017

19

Synairgen and Pharmaxis collaboration

• Develop an anti-fibrotic LOXL2 inhibitor

o Synairgen focussing on Idiopathic Pulmonary Fibrosis (IPF)

o Pharmaxis focussing on NASH (liver) and other fibrotic conditions

• High LOXL2 is associated with more rapid disease progression

• Recent deals in fibrosis include:

o Phase I

Gilead buys Nimbus Therapeutics in 2016 for Liver fibrosis programme $0.4bn up front and up

to $0.8bn future payments

o Phase II

Allergan buys Tobira Therapeutics in 2016 for Liver fibrosis programme $0.6bn up front and up

to $1.1bn future payments

Bristol-Myers Squibb enters an agreement in 2015 providing exclusive rights to acquire

Promedior Inc for up to $1.25bn

o Post approval

Roche acquired InterMune in 2014 for $8bn, main programme was pirfenidone for IPF, and

other anti-fibrosis programmes

20

Introduction to IPF

Two drugs approved

• Nintedanib (Boehringer Ingelheim)

• Pirfenidone (Roche)

Fibrosis in the lungs compromises gas exchange

21

LOXL2 inhibition in IPF

Role of LOXL2 in fibrosis

Fibroblast cells in

lung tissue

Collagen fibres Excessive ‘cross-linking’ of

collagen fibres, stiffens lung

tissue, causing fibrosis

LOXL2(from fibroblasts)

Excessive production and cross-linking of

collagen fibres results in fibrosis

22

Treatment of in vitro cultures using cells from IPF patients reduces tissue stiffness

Tissue stiffness was

assessed using a

parallel plate

compression system

(CellScale

Microsquisher)

23

Ad C o n Ad T G F 1 1 5 m g /k g 3 0 m g /k g

0

1

2

3

Es

t (c

mH

2O

/mL

)

E la s ta n c e (L u n g s t if fn e s s )

***

* **

C o m p o u n d 1

M e a n (S D )

Treatment improves lung function and reduces fibrosis in a model of lung fibrosis

• TGF-β is considered to be a major

player in both the initiation and

progression of IPF

• Transient (7–10 days)

overexpression of active TGF-β1

by adenoviral vector gene

transfection in the lung induces a

severe and progressive fibrosis

• Significant improvement in lung

function (Elastance) assessed

using the Flexivent system on Day

28

• Significant reduction in Ashcroft

fibrosis scoreStudy conducted at McMaster

University, Canada

24

LOXL2 Inhibitor summary

• LOXL2 implicated in IPF

• Small molecular weight orally bioavailable LOXL2 inhibitor

– Inhibits cross-link formation

– Reduces tissue stiffness in vitro

– Improves lung function in vivo

– Reduces fibrosis in vivo

– Also inhibits LOXL3 and LOXL4

– Excellent data in other fibrosis models e.g. NASH

• Pre-clinical development is complete, Phase I clinical trial scheduled

to start in Q4 2017

25

Core terms of deal

• SNG invests in IPF development activity to ‘catch up’ with

Pharmaxis historic spend

• Expected to reach parity in IPF by the end of Phase I, with

licensing revenues to be shared pro-rata

• Potential for compound to be used in other fibrotic conditions

such as NASH and kidney fibrosis. Proportionately lower share

of non-IPF revenues paid to Synairgen.

• Strong interest from potential partners in this programme

Financials

27

Financial highlights for the 6 months to 30th June 2017

• Research and development expenditure of £1.09 million as the

Company advanced the ongoing LOXL2 collaboration with

Pharmaxis through pre-clinical studies

• The loss from operations was £1.58 million

• Cash and bank deposits of £3.08 million at 3oth June.

• £0.62 million R&D tax credit received post period end

28

Major shareholders (26th September 2017)

Summary

30

Summary/Outlook

• Disease area focused: COPD and specialist indications

o Significant unmet clinical need = large market potential

• Inhaled IFN-β programme

o Phase II in COPD planned for winter 2017/2018

• LOXL2 collaboration with Pharmaxis

o Positive findings announced in March 2017

o Phase I clinical trial scheduled to commence in Q4 2017

o Out-licensing transaction targeted for 2018

• Company performing in line with strategy