November 21, 2016
Press Release
Company
RepresentativeInquiries

GreenPeptide Co., Ltd.
Kenichi Nagai, President & CEO(Code: 4594 TSE Mothers)
Teruhiko Sakai, Director/CFO(TEL: +81-3-5840-7697)

Announcement of the Acceptance of the Third Party Allocation of New Shares by
Advanced Immunotherapy, Co., Ltd. (Acquisition of the Ownership)
GreenPeptide Co., Ltd. wishes to announce that its board, at a meeting held on
November 20, 2016, decided to accept the third-party allocation of new shares by
Advanced Immunotherapy, Co., Ltd. (Representative President: Genjiro Miwa, HQ:
Minato-ku, Tokyo, hereafter, “AIT”) and acquire ownership. On the same day, we
executed a capital subscription contract with AIT.
1. Purpose of accepting the third-party allocation of new shares
We currently possess two key pipelines comprising ITK-1 in prostate cancer, which wasout-licensed to FUJIFILM Corporation, and GRN-1201 in melanoma, which is anoverseas strategic product. In order to pursue additional growth, we are expanding newseeds and platform technology for drug discovery. As part of this effort, we have
explored starting T-cell therapy research, in which the synergy with current R&D themesis high and there is high potential for cancer immunotherapy.
At AIT, we have decided to acquire the ownership of highly novel technology in the fieldof regenerative medicine/cell therapy using iPS technology. This company wasestablished to commercialize the inventions, which have been made by Dr. Hiromitsu
Nakauchi, Professor at the Institute of Medical Science, University of Tokyo andProfessor at Stanford University, et al., in Japan and Asian countries. The company has
engaged in research and development towards the first global commercialization of iPS
technology-based regenerative medicine for cancer immunotherapy. The company
possesses the technology to regenerate (rejuvenize) T cells using iPS technology, thereby
preventing the exhaustion of T cells that attack cancer cells, which has been a challenge
in cancer immunotherapy for many years. Similarly, the company possesses unique
technology to avoid adverse reactions that may occur in various processes when iPS cell1

therapy is conducted, which is also regarded as another challenge. Finally, by utilizing
non-self T cells using iPS technology (use of T cells from a subject other than a patient),
we expect that significant cost reduction can be achieved in cancer immunotherapy, forwhich treatment costs are typically very high. Furthermore, our various technologies andinformation related to cancer peptide vaccines and the peptide library may
synergistically affect the analysis of epitopes that recognize antigen-specific T cells,
which can be developed by iPS technology, and the discovery of T cells with hightreatment efficacy.
Including iCELL Inc., a patent management company for various inventions byProfessor Hiromitsu Nakauchi, we have agreed to make milestone payments toshareholders prior to the third-party allocation of new shares by AIT based on theprogress of product development activities at AIT.
We would like to position the acquisition of AIT as a stepping-stone for expanding ourdevelopment pipeline and entering the cutting-edge field of regenerative medicine/celltherapy. Moreover, we would like to become the leading company in cancer
immunotherapy.
2. Summary of the company acquired (Advanced Immunotherapy, Co., Ltd.)(1) Name

Advanced Immunotherapy, Co., Ltd.

(2) Location

10-2, Higashi Shinbashi 1-chome, Minato-ku, Tokyo(3) Title and name ofrepresentative

Genjiro Miwa, Representative Director(4) Business domain

Development of cancer immunotherapy using T-iPS cells(5) Capital

5,000,000 yen(6) Establishment dateFebruary 3, 2016

(7) Relationship withour company

There is no relationship between the capital, humanresources, business relationship, and conflict of interest.

(8) Consolidated management performance and consolidated financial condition of
the company in the recent 3 years.
AIT was established in February 3, 2016 and has not reached the fiscal year
ending December 2016. Accordingly, some descriptions are omitted.
3. Status of the shares after acquisition
We plan to acquire 67% of the shares issued by AIT.

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4. Future prospects(1) Date of Board meeting approval

November 20, 2016

(2) Date of contract execution

November 20, 2016

(3) Date of share transfer

December 1, 2016 (plan)

5. Future prospect
Acquisition of the shares will have minimum impact on business performance ending inMarch 2017.

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About Advanced Immunotherapy, Co., Ltd.
Advanced Immunotherapy, Co., Ltd. is a biopharmaceutical venture company thatdevelops cancer immunotherapeutics against viruses based on research findings byProfessor Hiromitsu Nakauchi at the Institute of Medical Science, University ofTokyo. Professor Nakauchi established iPS cells from T cells that recognize specificantigens and, for the first time, successfully induced T cells rejuvenated functionallyat a high efficiency while maintaining antigen specificity (Cell Stem Cell, 2013).
Based on a series of developed technologies, he filed 2 international patents(PCT/JP2011/052260, PCT/JP2013/064291). A patent was granted in one case (US9,206,394 B2) (Applicant: The University of Tokyo). Furthermore, by incorporatinga suicide gene (induced caspase 9) which can induce apoptosis, he successfully
improved the safety of iPS cell-derived T cell therapy (Stem Cell Reports, 2015).
Based on these research achievements, the company acquired the exclusive right tothe patent at presumed markets. The company is preparing for a clinical study to
examine the treatment of virus-related tumors by antigen-specific rejuvenated T cells.

About GreenPeptide Co., Ltd.
GreenPeptide is a drug discovery venture company engaged in the research anddevelopment of cancer immunotherapies that make use of the body’s immune system
to fight cancer. Cancer immunotherapies are expected to be the 4th therapy whensurgery, radiotherapy, and chemotherapy have failed.
Currently, we are mainly developing 2 peptide vaccines at clinical stage (ITK-1 forprostate cancer and FRN-1201 for melanoma). We would like to contribute to cancer
treatment by developing novel world-class cancer immunotherapeutics originatingfrom Japan.

4Significance of capital and businessalliance with Advanced ImmunoTherapy
̶ Innovation in cancer immune regeneration using iPS cells ̶(Security code: 4594）

November 21, 2016

Significance as a business strategy
 Acquire the latest cutting-edge technology in T celltherapy, an important area in cancer immunotherapy.
 Share knowledge related to the technology and clinicaldevelopment of immune cell activation including cancer
vaccines through current research and development
programs.
 Expectations as the first clinical application of iPS celltherapy for cancer immunotherapy and anticipation oflarge impacts in the subsequent development.

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Potential of seeds for drug discovery
Compared to current T cell therapies, higher efficacy and significant
cost reduction are expected.
Promising and feasible areas of projects
Therapy

Securing cell counts

CAR-T
TCR-T（current） （current）

Restricted

Restricted

T-iPS

T-iPS/
iC9RemarkUnrestricted
proliferation

Unrestricted
proliferation

Number of cells that can beobtained from patients is generally
limited.

Effect of T cell exhaustion

Yes

Yes

NoNo

Cell exhaustion is a condition inwhich T cells that contact anantigen for extended time express
PD-1, etc. and become susceptible
to the immune inhibitory system.

Proliferation capability(duplication capability)

Low

Low

High

High

Related to maintenance of various
effects in vivo.

Mechanisms to manage
adverse reactions

NoneNone

None

Yes

Safeguard mechanisms to manage
various adverse events.

BankingDifficult

Difficult

Easy

Easy

Banking will expand the scope ofapplication, such as the use ofnon-self.

HighHigh

Low

Low

Cost reduction of T-iPS therapy isbased on the use of non-self.

Manufacturing costs

3Positioning of seeds in cancer immunotherapy
In current cancer immunotherapy, progress has been made in two areas, i.e.,
activation of antigen-specific immune cells and improvement in the cancer
microenvironment (including check point inhibition). This alliance will help
establish our presence in the former area in an accelerated manner.
Activation of antigen-specific immune cells
Existing businesses area
Cancer peptide
vaccine(conventional type）

Cancer peptide
vaccine（Neoantigen）

Improvement of cancer microenvironment

New area
T-iPS therapy
Checkpoint inhibitor, etc.

Cancer cells

T cells

Dendriticcells▲Activation/Proliferation▲Contact with cancer cells▲Apoptosis ofcancer cells

4Summary of this platform technology
For T cell therapy, “Securing sufficient number of T cells with anti-canceractivity” has been challenging. Through the use of iPS technology, anunlimited number of rejuvenated (high-activity) T cells can be supplied.
Antigen specificity of T cells is maintained through these steps.

Banking by frozen
storage(Ready usable)

Banking by frozen storage

Bloodcollection

Administration

T cells that recognize various
antigens are obtained frompatientʼs blood.
Only cancer antigen-specific Tcells are selected. (T cells areexhausted at this point.)

Initialization（iPS cells）

Culture/proliferation(Unlimited proliferation isfeasible in the iPS cell stage.

Induced differentiation（Rejuvenated T cells）

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Summary of plan for managing adverse reactions
Using an apoptosis-inducing system (safeguard mechanism)
programmed by caspase 9, various adverse reactions that may
occur during treatment processes can be managed.
In case an adverse reaction occurs during treatment(1) T cells(2) Suicide gene
Incorporation of
Caspase9(3) Administrationof a specific drug(4) Activation of
caspase 9 andinduction ofapoptosis(5) Cell death(apoptosis)(Specific drug)(Caspase 9)
Introduction of
apoptosisinducing system

Turning theapoptosis-inducing
system ON

Active removal of the cause of adverse
reactions by apoptosis

6Future development strategy
Initially, development will be conducted in EB virus lymphoma, a type of virusthat induces hematological cancer, to demonstrate the proof of concept. In thefuture, indications with a large market size including solid cancer will bedeveloped.
Cancer specificity
of antigens

HighLow (Neoantigen: High)

Cancer microenvironmental hurdle

Virus

Non-virus

NoYes

Hematologicalcancer

Solidcancer

Initial indication:
EB virus lymphoma

Direction 3
Line extension to non-virus
hematological cancer

Direction 1
Line extension
to hematologicalcancer inducedby virus infection

Direction 2
Line extension tovirus-induced solidcancer

Direction 4
Line extension to non-virus solid cancer
with large market size

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Excerpt of Press Release for this technology by
the University of Tokyo Using induced pluripotent stem cells (iPS cells), T cells, one type of immune cells, weresuccessfully rejuvenated.
 This was the first successful re-differentiation of T cells from the re-programming of T cells into
iPS cells. Moreover, it was confirmed that these T cells were younger than the original T cells.
 This may provide an innovative treatment modality for chronic infections and cancer. Moreover,T-iPS cell banking may be established to help manage various diseases. Immunotherapy may
be conducted in an expedited manner in the future.
2013.1.4

Hiromitsu Nakauchi (Professor, Division of Stem Cell Therapy, Center for Stem Cell Biology and Regenerative Medicine, Institute of MedicalScience, University of Tokyo)

Generation of rejuvenated antigen-specific T cells by reprogramming to pluripotency and redifferentiation. Cell Stem Cell (2013.1.4) Nishimura, et al.

 It was demonstrated that human immune cells (T cells) rejuvenated by iPS cell technology
reduced tumors in vivo in mice.
 It was shown in vivo in mice that programming of a suicide gene into T cells could chemicallycontrol adverse reactions that may occur at various stages of iPS cell-based T cell therapy.
 This research output may improve the safety of iPS cell-based T cell therapy and is expected toserve as a bridge for research towards clinical application of this therapy.
2015.8.27

Hiromitsu Nakauchi (Professor, Division of Stem Cell Therapy, Center for Stem Cell Biology and Regenerative Medicine, Institute of MedicalScience, University of Tokyo)
Miki Ando (Division of Stem Cell Therapy, Center for Stem Cell Biology and Regenerative Medicine, Institute of Medical Science, Universityof Tokyo)

A Safeguard System for Induced Pluripotent Stem-Cell Derived Rejuvenated T-cell Therapy. Stem Cell Reports (2015.8.27) Ando et al.

8Disclaimer
 The information contained in this material indicates future prospectsof our company and future planning. Descriptions about these future
prospects are based on the current hypothesis about future eventsand dynamics. There is no guarantee that such hypotheses arecorrect. Because of various factors, actual business performance
may significantly differ from the descriptions in this material.
 This material is intended to provide investors with information andcontains management information and future business plan, etc.,
and is not for soliciting investments. Investment decisions should bemade individually.
 This material describes information about pharmaceutical products.
However, this information is not intended for advertisement or as
medical advice.
 Information described in this material may be changed without priornotice. Any damages as a result of this material are not theresponsibility of our company or those who provided the information.

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