NON-CONFIDENTIAL

FY2021 Financial Results
12-month period ended December 31, 2021
10 February 2022 | Sosei Group Corporation (TSE:4565)

Disclaimer
The material that follows is a presentation of general background information about Sosei Group Corporation and its subsidiaries (collectively, the “Company”) as of the date of this presentation. This material has been
prepared solely for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities and should not be treated as giving investment advice to recipients. It is not targeted to the specificinvestment objectives, financial situation or particular needs of any recipient. It is not intended to provide the basis for any third party evaluation of any securities or any offering of them and should not be considered as arecommendation that any recipient should subscribe for or purchase any securities.
The information contained herein is in summary form and does not purport to be complete. Certain information has been obtained from public sources. No representation or warranty, either express or implied, by theCompany is made as to the accuracy, fairness, or completeness of the information presented herein and no reliance should be placed on the accuracy, fairness, or completeness of such information. The Company takes noresponsibility or liability to update the contents of this presentation in the light of new information and/or future events. In addition, the Company may alter, modify or otherwise change in any manner the contents of thispresentation, in its own discretion without the obligation to notify any person of such revision or changes.
This presentation contains “forward-looking statements,” as that term is defined in Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended. The
words “believe”, “expect”, “anticipate”, “intend”, “plan”, “seeks”, “estimates”, “will” and “may” and similar expressions identify forward looking statements. All statements other than statements of historical facts included inthis presentation, including, without limitation, those regarding our financial position, business strategy, plans and objectives of management for future operations (including development plans and objectives relating to our
products), are forward looking statements. Such forward looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to bematerially different from any future results, performance or achievements expressed or implied by such forward looking statements. Such forward looking statements are based on numerous assumptions regarding ourpresent and future business strategies and the environment in which we will operate in the future. The important factors that could cause our actual results, performance or achievements to differ materially from those in theforward looking statements include, among others, risks associated with product discovery and development, uncertainties related to the outcome of clinical trials, slower than expected rates of patient recruitment,
unforeseen safety issues resulting from the administration of our products in patients, uncertainties related to product manufacturing, the lack of market acceptance of our products, our inability to manage growth, thecompetitive environment in relation to our business area and markets, our inability to attract and retain suitably qualified personnel, the unenforceability or lack of protection of our patents and proprietary rights, ourrelationships with affiliated entities, changes and developments in technology which may render our products obsolete, and other factors. These factors include, without limitation, those discussed in our public reports filedwith the Tokyo Stock Exchange and the Financial Services Agency of Japan. Although the Company believes that the expectations and assumptions reflected in the forward-looking statements are reasonably based on
information currently available to the Company's management, certain forward looking statements are based upon assumptions of future events which may not prove to be accurate. The forward looking statements in thisdocument speak only as at the date of this presentation and the company does not assume any obligations to update or revise any of these forward statements, even if new information becomes available in the future.
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This presentation contains non-GAAP financial measures. The non‐GAAP financial measures contained in this presentation are not measures of financial performance calculated in accordance with IFRS and should not be
considered as replacements or alternatives profit, or operating profit, as an indicator of operating performance or as replacements or alternatives to cash flow provided by operating activities or as a measure of liquidity (ineach case, as determined in accordance with IFRS). Non-GAAP financial measures should be viewed in addition to, and not as a substitute for, analysis of the Company's results reported in accordance with IFRS.
References to "FY" in this presentation for periods prior to 1 January 2018 are to the 12-month periods commencing in each case on April 1 of the year indicated and ending on March 31 of the following year, and the 9 month
period from April 1 2017 to December 31 2017. From January 1 2018 the Company changed its fiscal year to the 12-month period commencing in each case on January 1. References to "FY" in this presentation should beconstrued accordingly.
© Sosei Group Corporation. Sosei Heptares is the corporate brand and trademark of Sosei Group Corporation. Sosei, Heptares, the logo and StaR® are trademarks of Sosei Group companies.

2

Agenda3

1

Business Summary2

FY2021 Consolidated Financial Results

3

Operational Highlights

4

Organic Growth Plan Update

5Strategic Growth Plan Update

6

FY2022 Strategic Goals

7

Appendix

Note: This material was created to explain the details of our company and is not intended to be used for investment decisions. In addition, the contents reflect the views of our company at the time of thecreation of the material, and the accuracy of the information is not guaranteed. Investments should be made based on the independent views of investors

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
Growth1
Business Summary
Shinichi Tamura, Chairman & CEO

4

5. Strategic
Growth

6. FY2022
Goal

7. Appendix

Vision/Business Overview

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Our vision is global biotech champions from Japan by solving challenges of drug discovery

Increasing healthcare costs

Make small molecule drug discovery
more efficient and sophisticated with
proprietary technology

Numerous unmet medical
needs

Depleting drug discovery
targets

Logical approach to drugs
with new mechanism

Capture undruggable targets

We aim to overcome challenges with proprietary tech-based drug discovery platform (StaR®/SBDD) andbecome “one of Japan’s global biopharmaceutical champions”

5

7. Appendix

1. Business
Summary

Current major target

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

GPCRs the largest drug discovery target, having large potential that our platform can approach~400

GPCR targets
active indiseases2~34%

of FDAapprovals
target GPCRs1

27%
of global
sales
are GPCR
drugs1NEUROLOGICAL DISORDERS
GASTROINTESTINAL DISEASESIMMUNOLOGY/ONCOLOGY

BEST-IN-CLASSFIRST OR
BEST-IN-CLASS

Drugged27%

In trials
17%

METABOLIC DISORDERS
CARDIOVASCULAR

As yet undrugged
56%

RESPIRATORYGPCRs are active in a wide range of disease areas,
and offer broad therapeutic potential

6~400 GPCR targets in the body active in disease2

FIRST-IN-CLASS

Significant opportunity to target new first-in-class
and/or improved best-in-class GPCR medicines

Sources: 1 “Unexplored opportunities in the druggable human genome”, Nature Reviews, 2016 ; 2 “Trends in GPCR in Drug Discovery – new agents, targets and indications”, Nature Reviews, 2017

7. Appendix

1. Business
Summary

Our Strengths

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

World-leading tech-based drug discovery platform (StaR®/SBDD)
Conventional drug discovery

Our drug discovery

Location

Empirical design

Rational design (computer-based)

MethodHigh Throughput Screening (HTS1)

Drug discovery tech-platform (StaR®/SBDD2)Period3

4.5 years on average

3.0 years on average

Costs3$15 million$5 million

Features 4

Target structure usually unclear,difficult to design drugs precisely

Execute precise drug design following theconfirmation of target structure

Target 4

Difficult for GPCRs with unstable structures

Focusing on GPCRs with unstable structures

1 HTS/High Throughput Screening is a method to find drug candidates by actually reacting tens of thousands to millions of compounds with drug targets using large machines and human hands.

2 StaR®: Stabiised Receptor is a method for stabiising drug targets with unstable structures, such as GPCRs, and using them for structural analysis. SBDD: Structure-Based Drug Design is a method to design

7

and screen compounds on the computer based on structural information (ref: Appendix) 3 The period from target selection to preclinical testing. For conventional drug discovery, figures are taken from
NATURE REVIEWS Drug Discovery (MARCH 2010). 4 Precise drug design make clear the binding site of target, make easier to improve compound, create backups and redo – potentially increase the successrate. GPCR is most popular drug target which account for 30% of current drug target.(The details are to be mentioned later)

7. Appendix

Track record of our drug discovery

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

7. Appendix

Higher drug discovery efficiency with our tech-based drug discovery platform (StaR®/SBDD）
Number of programs

Trends in the number of programs per stage (cumulative)

2020 vs 2021

35

2020

30

Lead optimization

25

Clinical and beyond

Drug discovery

10+

10+

Lead optimization

6

7

+1

Preclinical

12

15

+3

Clinical - Phase 1

7

9

+2

Clinical – Phase 2

1

1

Clinical – Phase 3

0

0

5

Approval application

0

0

0

Approved

00Preclinical

20
15
10

8

2021

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

1. Business
Summary

Business Model

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Focus on innovation in the early stages, partnering with major pharmaceuticals after that
Drug discovery

Preclinical (in animal)

Innovative and efficient drug discovery,
leveraging tech-platform drug discovery

Clinical (in human)

Major
Pharmaceuticalcompanies

Commercialization

Expand globally through big pharma's
development, disease know-how, andlarge-scale sales capabilities

Payment 1 - 3 from major pharmaceutical companies through licensing are our major revenue
1

Upfront payment

Receive upon license agreement

2

Milestone payment

Receive upon the successful progression of the program

3

Royalty

Payment on future net sales (ranging from high single digit to mid-teen percentage of the sales at most)

Japan

9

Our strategic tactical development team in Japan willconduct late-stage clinical trials through to marketing,where our strengths can be leveraged.

(2 products have been marketed)

7. Appendix

1. Business
Summary

Our licensing partners

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Total license value we made with world-class pharmaceutical companies
Balance of potential milestone from existing license agreements1

Top 15 pharmaceutical/biotech companies by license value2(responding to 1 and 2 in the previous slides)(cumulative total since 2015)(USD million)(USD million)(USD million)

1,200

12,0000
10,000

1,000

8,000

800

4,500+

6,000

10,00015,000

Ionis
Aquestive
Daiichi Sankyo
Pieris

600

400

Eisai

7th out of 2,397

Galapagos
Nurix

4,400+

2,000

200

Dicerna
Precision
Genmab00

FY15/315/3期

FY16/316/3期

FY17/317/3期

FY18/318/3期

開発マイルストン残額（左軸）Development milestone(left axis)

FY18/12
18/12期 FY19/12
19/12期 FY20/12
20/12期 FY21/12
21/12期販売マイルストン残額（左軸）Commercial milestone(left axis)

一時金・マイルストン受領額（右軸/累計）
Received upfront and milestone(right axis/cumulative)

10

20,000AstraZeneca

Sosei Group
4,000

5,000

XencorArrowhead
CytomX

1 Balance as of the end of the fiscal year of only those currently under contract. TEVA and Abbvie (formerly Allergan), for which compounds were returned, are excluded from the balances from FY2018 andFY2021, respectively. 2 The figures are based on a third party's (EvaluatePharma's) proprietary database and therefore do not completely match the amounts shown in the LHS chart.
Source: Company’s data (LHS) and EvaluatePharma (as of 2022/1/18) (RHS)

25,00030,0007. Appendix

1. Business
Summary

2. Consolidated
Results

Potential revenue from existing partnerships

3. Highlight

4. Organic
Growth

5. Strategic
GrowthSecuring stable revenues in the short to medium term from existing partnerships
2

Potential milestone from existing partners

3

Potential royalty from existing partners~$250bn/year

Expand by executing
new collaborations

In addition to $4.4bn+ below$4.5bn +1(potentially receive after commercialized)

Commercial milestone(from existing partners)$4.4bn+ 1

Expand by
executing newcollaborations

Total market size ofour target diseases(maximum)~$43bn/year(Sum up for peak sales of product)

Product Market potential(maximum)Product Market potential(maximum)×~mid-teen percentage1(potentially receive after commercialized)(potentially receive in next c.10 years)
Development
milestone(from existing
partners)(Total drug market for target indication)

Potential royalty(maximum)Short to medium term revenue
potentially received in next 10 years

Mid to long term revenue potentially
received after commercialized

1 All of these are the maximum values if all existing programs are successful. Note that the probability of success in drug discovery is not relatively high, and realistically not all programs will be successful.
Source: Total market size of our target diseases and Product Market potential is stated in the Appendix

11

6. FY2022
Goal

7. Appendix

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

2
FY2021 Consolidated Financial Results
Christopher Cargill, CFO

12

7. Appendix

Another year of successful execution

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Summary Financial Highlights for the 12 months ended 31 December 2021

1

Revenue of ¥17,712m ($161m) vs. ¥8,842m ($83m) in prior year, substantial increase driven by
Neurocrine transaction.

2

Core Earnings of ¥8,904m ($81m) vs. ¥2,904m ($27m) in prior year; Operating Profit of ¥3,775m($34m) vs. ¥928m ($9m) in prior year, substantial increases driven by Neurocrine transaction.

3

Net profit of ¥1,017m ($9m), successfully achieving our corporate goal to target sustainable and/or
profitable results for the full year despite significant impairment and contingent consideration charges.

4~¥10bn new growth capital raised, adding funds earmarked to accelerate our strategic growth
initiatives and investments.

5

Net cash inflow of ¥20bn ($136m), resulting in a robust cash balance of ¥60bn ($522m) at year end.
Our unique and balanced business model continues to support a sustainable financial profile

13

Note: USD:JPY FX rates used – 110.16 (FY2021) and 106.77 (FY2020)

7. Appendix

Key financial indicators

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Significantly increased Operating Profit reflected encouraging revenue growth partially offset by (i) planned
increase in R&D, and (ii) a non-cash impairment charge
Operating Profit (JPY million)

Revenue (JPY million)
100%

17,712

307%

3,775

8,842
928

12m to 31-Dec-20

12m to 31-Dec-21• Revenue increased +100% vs. 2020 primarily due to Neurocrine
transaction. Milestones from existing partnerships include:• GSK (GPR35)• Pfizer (MC4 Ph 1 start)• Genentech (Delivery of StaRs®)• Deferred revenue releases on AbbVie and Genentech
collaborations• Royalties from Novartis declined slightly.
Notes: 1. SBC = Stock-Based Compensation; 2. RSU = Restricted Stock Units

14

12m to 31-Dec-20

12m to 31-Dec-21• R&D costs increased due to higher activity on in-house programs,
participation in new co-development collaborations and the impactof a stronger GBP vs. JPY.
• Intangible asset impairment charge associated with a collaboration
partner’s decision not to progress certain out-licensed drugcandidates in clinical trials.
• Higher SBC1 costs from continued roll out of RSU2 plans – aligning
management’s interests with shareholders.

7. Appendix

1. Business
Summary

Revenue breakdown

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Significant increase in revenue driven by the Neurocrine transaction helped to generate amodest net profit despite significant impairment and contingent consideration charges
JPY million

IFRS
Revenue
Cost of Sales
R&D
G&A
Other Income
Other Expense
Operating Profit
Finance Income
Finance Expense
Equity Acc. Investments
Net Profit before Tax
Net Profit after Tax

12m ended 31
Dec 2020
8,842
(761)
(3,793)(3,435)
79
(4)
928
1,628
(578)
(356)
1,622
1,479

USD million

12m ended 12m ended
31 Dec 2021 31 Dec 2020
17,712
82.8
(933)
(7.1)
(5,931)(35.5)(3,940)(32.2)
8
0.7(0.0)
1 (3,141)
3,775
8.7
199
15.2
(5.4)
2 (3,797)
256
(3.3)
433
15.2
1,017
13.8

12m ended
31 Dec 2021
160.8
(8.5)
(53.8)(35.8)
0.1
1(28.5)
34.3
1.8
2(34.5)
2.3
3.9
9.2

Revenue by Type

11%

29%

12m ended
31 Dec 20202• Includes non-recurring charge of ¥2,891 million to increase the contingent consideration

provision to cover the $35m liability to former Heptares shareholders arising from the
Neurocrine transaction. A major component of the 2015 Heptares SPA1 has now expired, andwe do not expect significant contingent consideration charges annually going forward

Note: USD:JPY FX rates used – 110.16 (FY2021) and 106.77 (FY2020)

1 SPA = Share Purchase Agreement

154%12m ended
31 Dec 2021

60%

83%

1• Includes non-cash impairment charge of ¥3,064 million following a collaboration partner’s

decision not to progress older licensed drug candidates, and to instead focus development
efforts on next-generation candidates with novel chemistry and longer patent protection

13%

Milestone
Royalty

12m ended 31 Dec 2020
¥5,353m$50.1m¥2,544m$23.8m12m ended 31 Dec 2021
¥14,667m$133.1m¥2,311m$21.0m

–

–

¥28m

$0.3m

Other

¥945m

$8.9m

¥706m

$6.4m

Total Revenue¥8,842m$82.8m¥17,712m$160.8m

Product Sales

7. Appendix

1. Business
Summary

Introduction of ‘Core Earnings’

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Core Earnings – the financial indicator favored by investors
12m ended 12m ended
31 Dec 2020 31 Dec 2021

IFRS Revenue
IFRS COSIFRS R&D
IFRS G&A
Total IFRS OPEXIFRS Other Income/(Exp)IFRS Operating Profit

8,842
(761)
(3,793)(3,435)(7,989)75928

Add back material Non-cash costs:
Depreciation
507
Amortisation
843
Share Based Payments
626
Impairment
Remove material Non-recurring costs:
Restructuring/Other
Core Earnings
2,904

Commentary

USD million

JPY million

12m ended
31 Dec 2020

12m ended
31 Dec 2021•

17,712(933)(5,931)(3,940)(10,804)(3,133)
3,775

82.8
(7.1)
(35.5)(32.2)(74.8)
0.7
8.7

160.8
(8.5)
(53.8)(35.8)(98.1)(28.4)
34.3

Core Earnings is a new key financial indicator thathighlights the underlying recurring cash generating
capability of the business.

•

Core Earnings is defined as IFRS Operating Profit +material Non-cash costs + material non-recurring costs•

Material Non-cash Costs include depreciation,amortization, share based payments and impairment.

540
738
713
3,138

4.8
7.9
5.8
-

4.9
6.6
6.5
28.5

•

Material Non-recurring Costs include restructuring costs
and other material one-off items.

•

8,904

27.2

80.8

Core Earnings = Cash Earnings + material Non-recurring
Costs

Going forward we will disclose our Income Statement in a similar format to major Japanese pharmacompanies. We will breakdown the calculation of ‘Core Earnings’ – a key financial indicator for investors
16

7. Appendix

1. Business
Summary

Balance Sheet

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Sustainability of the business model and corporate strategy reflected via robust balance sheet
JPY million
As of
31 Dec2020
Goodwill & intangibles

25,936

Property, plant & equip.

3,824

Cash at hand

40,008Equity Acc. investments

1

2

USD million

As of
31 Dec2021

As of
31 Dec2020

24,215

250.5

3,817

36.9

As of
31 Dec
2021
210.4
33.2

2

60,087

386.5

3,087

3,479

29.8

30.2

Other financial assets

1,593

2,650

15.4

23.0

Other assets

2,017

2,737

19.5

23.9

Total Assets

76,46596,985

738.6

842.8

Convertible Bonds

14,78927,440142.9

Contingent
Consideration

1,107

4,095

10.7

Other liabilities

8,188

8,524

79.0

74.0

Total Liabilities

24,08440,059

232.6

343.4

Net Assets

52,381

56,926

506.0

499.4

3
4

Notes: USD:JPY FX rates used – 31 Dec 2020 spot rate: 103.52, 31 Dec 2021 spot rate: 115.07
1. Includes Investing, financing and FX related movements

171Commentary

3
4

522.1

238.5

1 Decrease relates to intangible asset impairment arising froma collaboration partner’s decision not to progress certain
out-licensed drug candidates in clinical trials.

2 Major increase in cash balance due to issuance ofConvertible Bonds and receipt of Neurocrine upfront fee.

3 New convertible bonds issued in July 21.
4 Includes $35m liability relating to the Neurocrine deal.

Cash Flow Bridge (12m ended 31 Dec 2021)
USD Millions

35.6

Cash balance
31 Dec 2020

Operatingcash flows

Othercash flows1

Cash balance
31 Dec 2021

7. Appendix

Cost Guidance for FY2022

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

7. Appendix

Guidance stated on total IFRS expenses basis going forward, rather than cash basis used in FY2021

Guidance(FY2022)

R&D expenses (IFRS basis)

G&A expenses (IFRS basis)¥5,750 to 6,750m¥3,750 to 4,250m(FY2021: Actual ¥5,931m)(FY2021: Actual ¥3,940m)• Increase investment across all divisions togrow capacity and progress priority assets
towards early clinical development toenhance value before partnering• Maintain investment in functional support
teams (IT, Finance, HR, etc.) to enable
great science• Build on robust governance practices

Modest increases planned for R&D and G&A in FY2022 versus FY2021, in line with our balanced
and sustainable business model. Investing today to create value tomorrow18

1. Business
Summary

2. Consolidated
Results3
Operational Highlights
Christopher Cargill, CFO

19

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

7. Appendix

1. Business
Summary

Achievement in FY2021

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Promote future growth through both organic and strategic growth
FY2021 OBJECTIVES

Organic
GrowthStrategic
Growth20

ACHIEVEMENT

1

Execute 2-3 new high value collaborations and/or
co-investments every year✓

Completed: 1

2

Expand expertise in GPCRs✓

Completed: drug discovery platform

3

Generate 2 new preclinical candidates on average, every
year✓

Completed: M1 agonist backup

4

Advance discovery and development pipeline✓

Completed: advanced to Ph1

1

Seek out revenue-generating opportunities including
M&A✓

Completed additional fundraising in July.
Continue to look for suitable acquisition
target.

2

Invest / collaborate in novel technologies✓

Completed3

Expand drug target classes beyond GPCRs✓

Completed

4In-license late-stage programs for Japan market✗

Not yet completed

Continue to update

M1/M4 dual agonist
MC4 ant. and CGRP ant.

7. Appendix

1. Business
Summary

Pipeline overview
Pre-Disc. / Discovery

2. Consolidated
Results

Preclinical studies

Phase 1

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Phase 2

7. Appendix

Marketed

Multi-target

Multi-target

M1M4 ag.

M4 ag. HTL’878

Single target

Multi-target

M1 ag.

GLP-1 ag.

Seebri® Breezhaler®

GPR35 ag.

CCR6 ant.

Enerzair® Breezhaler®

MC4 ant.

Oravi®

Multiple

GI and other

Neurology

Neurology

Multiple

Inflammatory

Outlicensed

IBD

Neurology

T2DM/Obesity

IBD

Anorexia

A2a ant. combo(s)1mCRPC

Ultibro® Breezhaler®
COPD

COPD

AsthmaMouth candidiasis

CGRP ant.
Neurology

Co-dev /Profitshare

PAR2 peptide
TPD

Antibody

Inflammatory diseases

Ion channel

AI-driven

AI-driven

Co-owned
companies

In-house /Not yetpartnered

21

CXCR4 mAb

Immuno-oncology

AI-driven

OX1/OX2 ag.

mGlu5 NAM

Narcolepsy

10+ other programs

Substance Use

SARS-CoV-2 MPro
Coronaviruses

GPR52 ag.

PAR2 mAb

EP4 ant.

Atopic Dermatitis

Neurology

Immuno-oncology

Partnered Program

H4 ant.

In-house ProgramEP4 ag.

To be discussed
further onfollowing slides

Atopic Dermatitis

IBD

Note: Seebri®, Ultibro®, Enerzair® and Breezhaler® are registered trademarks of Novartis AG.) 1AstraZenenca have removed the A2a program from their clinical pipeline as at Q3 2021

1. Business
Summary

Major licensing deals

2. Consolidated
Results

4. Organic
Growth

3. Highlight

5. Strategic
Growth

6. FY2022
Goal

Achieved one of the largest executed CNS license collaborations with Neurocrine in 2021
Partner

Execution

Program

Therapeutic Area

Upfront and Initial
Milestone

Potential Total
Milestone1

November 2021

Collaboration and license agreementfor M4, M1 and M1/M4 dual agonist

Neurological disorders$100m$2.6bnDecember 2020

Collaboration and license agreement
for GPR 35

Gastrointestinal, immunology

$44m

$480m

December 2020

Collaboration and license agreement
for CGRP portfolio

Neurology

$10m

$380m

June 2020

Discovery Collaboration andOption to License2

Inflammatory andAutoimmune

$32m

$400m

August 2019

Multi-target Collaboration

Multiple; Initial focus on
Gastrointestinal$26m$1.2bnJuly 2019

Multi-target Collaboration

Multiple

$26m

$1bn

November 2015

Multi-target Collaboration

Multiple--$1.8bnAugust 2015

Collaboration and license agreement
for A2a antagonist3

Immuno-oncology

$10m

$500m

1Potential option fees, development, regulatory and commercial milestone payments. Sosei Heptares is also eligible to receive tiered royalties ranging from high single digit to mid-teen percentage on future22

net sales of any products developed under the partnership. 2 AbbVie has the option to expand the collaboration by an additional three targets. 3 AstraZenenca have removed the A2a program from theirclinical pipeline as at Q3 2021

7. Appendix

Four upcoming wholly-owned programs

1. Business
Summary

2. Consolidated
Results

4. Organic
Growth

3. Highlight

5. Strategic
Growth

6. FY2022
Goal

Prioritized for development over the next 12 to 24 months

Schizophrenia
and Psychosis

AtopicDermatitis

Immunosuppression
in solid tumours

Inflammatory
Bowel Disease

GPR52 agonist

H4 antagonist

EP4 antagonist

EP4 agonist

TARGET PRODUCT PROFILE

•
•

23

Once daily oral
small molecule
24hr target
engagement••

Once daily oral
small molecule
To be used as amonotherapy orin combination••

Once daily oral small
molecule
To be used in combo
with checkpoint
inhibitors•••

Oral GI restricted
Good potency andselectivity
Minimal GI systemic
exposure

7. Appendix

1. Business
Summary

2. Consolidated
Results

3. Highlight4
Organic Growth Plan Update
Dr. Miles Congreve,
Senior Vice President,
Chief Scientific Officer
24

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

7. Appendix

1. Business
Summary

Achievement in FY2021 (Organic Growth)

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Major progress in muscarinic and drug discovery platform are in the following slides
FY2021 OBJECTIVES

Organic
GrowthStrategic
Growth25

ACHIEVEMENT

1

Execute 2-3 new high value collaborations and/or
co-investments every year✓

Completed: 1

2

Expand expertise in GPCRs✓

Completed: Continue to update

3

Generate 2 new preclinical candidates on average, every
year✓

Completed: M1/M4 dual agonist

4

Advance discovery and development pipeline✓

Completed： MC4 ant. and CGRP ant.

drug discovery platform
M1 agonist backup
advanced to Ph1

1

Seek out revenue-generating opportunities including M&A✓

Completed additional fundraising in July.
Continue to look for suitable acquisition
target.

2

Invest / collaborate in novel technologies✓

Completed3

Expand drug target classes beyond GPCRs✓

Completed

4In-license late-stage programs for Japan market✗

Not yet completed

7. Appendix

1. Business
Summary

New strategic collaboration with Neurocrine

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal$100m upfront and up to $2.6bn in future economics for selective Muscarinic agonist family
1

Neurocrine gained rights to a portfolio of potential best-in-class selective
muscarinic receptor agonists in development for the treatment of major CNS
disorders2

Sosei Heptares received US$100 million upfront

3

Sosei Heptares to receive ongoing R&D funding and up to US$1.5 billion in
potential development and regulatory milestones, up to US$1.1 billion incommercial milestones, plus tiered up to mid-teen percentage royalties on net
sales

4

Sosei Heptares also retained the rights to develop all muscarinic M1 agonists inJapan in all indications, with Neurocrine receiving co-development and profit shareoptions

Licensed Portfolio

M4 agonists(Global)Dual M4/M1 agonists(Global)M1 agonists(ex-Japan)

Developing novel muscarinic receptor agonists for schizophrenia and other neuropsychiatric disorders

26

7. Appendix

M4 agonist competition landscape

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Muscarinic M4R now an increasingly de-risked and validated target for multiple types of SZ
We are potentiallybest in class
Lead Program

KarXT

CVL-231(Emraclidine)

HTL16878

Mechanism of
ActionM1/M4 agonist
M2/M3 antagonist

M4 PAM2

M4 agonist

Ph3

Ph1b

Ph2 in 2022

Phase

（most advanced
program）

27

TargetSchizophrenia
Dementia related neuropsychiatricdisorders

Schizophrenia

Schizophrenia

Impact of recent
clinical data1

Achieved primary endpoint
in Phase II clinical trial(18 November 2019)
Share price: $17.68 → $85.10($1.7bn+ Market cap increase)

Positive results from Phase I
clinical trials(29 June 2021)
Share price: $12.57 → $23.20（$1.6 bn+ Market cap increase)-

1 Change in share price 5 days after announcement; 2 PAM = Positive Allosteric Modulator
Source: Company disclosures, FactSet• Avoids non-M4R
muscarinic side
effects• Mitigates

peripheral M4R
cardiovasculareffects• Different profile to
PAM, M4 agonist
can be more
effective inpatients who lackcholinergic tone

7. Appendix

Our discovery platform updates

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Further strengthening our world leading platform for GPCR by developing new technology
Pre-Disc. / Discovery

Preclinical studies

Target ID

Structure

Hit ID

StaR®

SBDD

Solid CoreTechnologies
Latest updating
our platform(Stabilised Receptor)+

CryoEM

Clinical studies

28

Lead Optimization(Structure-Based Drug Design)+

DEL Screening(DNA Encoded Library)Protein Binder Toolkit“for difficult target/faster”

Commercialization“for better compound/faster”

World leading
Tech-based drug
Discovery
Platform for GPCR

7. Appendix

Our discovery platform updates (cont'd)

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Combining with our StaR®/SBDD, 3 new technologies makes our platform better and faster• 12 Unique GPCRs resolved by CryoEM in 2020-2021.

CryoEM• We have our own CryoEM internally and access to 2 high power instruments in Cambridge.
Richard Henderson, our co-founder and Scientific Advisory Board member won the Nobel
prize (2017) for developing this technology.
• Example: Family B receptors are implicated in a range of disease areas and are long standing
drug targets – structure determination of these receptors was historically challenging.
• We have determined multiple structures of Family B receptors by both X-ray
crystallography and cryo-EM to enable SBDD.
• Most CryoEM structures we have solved required the introduction of additional protein
domains.

Protein Binder
Toolkit• These include domains fused to the StaR® or introduced during expression or purification.

2D class averages

nanobody• Fusion partners, mini G proteins*, nanobodies and antibody fragments have all beensuccessfully used.
• In addition to structures, protein binders also facilitate protein engineering, biophysics andpharmacology.
• Alternative strategy for hit identification in early drug discovery.

DEL Screening(DNA Encoded
Library)• Libraries of 15 billion to >1 trillion compounds.
• Allows access to unprecedented levels of diversity.
• Compounds engineered with unique features to facilitate identification.
• We first reported DEL for PAR2 StaR® in 2018.
• 13 StaR® proteins have now been subjected to DEL screens.

29

StaR®

*US patent, US 10,738,287 B2, relating to the miniG technology was granted in the name of Heptares Therapeutics Limited in 2020. First granted patent from the miniG family, WO 2017/129998 A1 - also
granted in 2021 in the UK (GB 2558968B) and Australia (AU 2017212788B2), and pending in territories including Europe, China, Japan and Canada.

G protein

7. Appendix

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth5Strategic Growth Plan Update
Dr. Matt Barnes,
Senior Vice President, Drug Discovery,
Head of R&D Portfolio Management30

6. FY2022
Goal

7. Appendix

1. Business
Summary

Achievement in FY2021 (Strategic growth)

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Major progress in new technologies and expansion beyond GPCR are in the following slides
FY2021 OBJECTIVES

Organic
GrowthStrategic
Growth31

ACHIEVEMENT

1

Execute 2-3 new high value collaborations and/or
co-investments every year✓

Completed: 1

2

Expand expertise in GPCRs✓

Completed:

Continue to update drug
discovery platform

3

Generate 2 new preclinical candidates on average, every
year✓

Completed:M1/M4 dual agonist
M1 agonist backup

4

Advance discovery and development pipeline✓

Completed： MC4 ant. and CGRP ant.

1

Seek out revenue-generating opportunities including M&A✓

Completed additional fundraising in July.
Continue to look for suitable acquisition
target.

2

Invest / collaborate in novel technologies✓

Completed3

Expand drug target classes beyond GPCRs✓

Completed

4In-license late-stage programs for Japan market✗

Not yet completed

advanced to Ph1

7. Appendix

Strategic collaboration Target

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
GrowthTo leverage technology by choosing right targets and agent is our greatest opportunities
Key opportunity/Target of Strategic collaboration

Choosing
the right target

•
•

32

Will modulating the target
affect disease?
Can a good modulator of thetarget be found?

Discoveringa therapeutic agent••

Identifying a modulator withthe appropriate profile
Differentiating fromcompetitors (if any)

Conducting
the right patient studies••

Demonstrating the value ofthe agent in treating disease
Utilizing biomarkers to
support patient stratification

6. FY2022
Goal

7. Appendix

1. Business
Summary

Strategic collaboration landscape

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Significant build of in-house methods and industry collaborations to drive new best practicePre-Disc. / Discovery

Preclinical studies

Clinical studies

Commercialization

Target ID

Structure

Hit ID

Lead Optimization

Choosing the right target

Our Core Technologies
StaR®

SBDD

CryoEM

DEL Screening

Protein Binder Toolkit
Discovering a therapeutic agent

33

World leading
Tech-based drug
Discovery
Platform for GPCR
and beyond

7. Appendix

Strategic collaboration Partners

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Three new key partnerships in AI drug discovery field since 2021

AI drug discovery (Target)

•

•

34

Research collaboration combining
Verily’s immune profilingcapabilities and SH’s StaR®
platform and SBDD capabilities
Collaboration aims to identify
GPCRs expressed in immune cells,
enhance our understanding of
their functional relevance andprosecute as potential drug
targets in immune-mediateddiseases

AI drug discovery (Target)••

Discovery collaboration
combining InveniAI’s AI-powered
platform for target discovery with
SH’s GPCR SBDD and early
development capabilities
Collaboration aims to identify
new therapeutic productconcepts for immune diseases
and generate novel compounds
that could improve responses toexisting immunotherapies

AI drug discovery (Compound)••Technology collaboration with
PharmEnable to leverage its
proprietary artificial intelligenceenabled and medicinal chemistry
technologies.
Collaboration to drive novel drug
discovery against a challenging
peptidergic GPCR target
associated with neurologicaldiseases.

7. Appendix

1. Business
Summary

New multi-target collaboration with Verily

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Aims to accelerate the development of novel therapies for immune-mediated diseases
300+
Potential
GPCRs

High priority
candidate targets

Immune ProfilerData
8 million readouts per sample+ Reference data

Analysis
Integrative analysis+ Quality Control

Cell sorting & frequencies

Prioritized pathways & signatures

Gene expression

Multi-faceted evidence

Disease score, treatment / response

Public datasets

Chromatin accessibility & contacts

Wet lab validation= Better Tx & Better Dx

35

Structure-based
drug development

StaR® Platform
GPCRs are proteinsthat represent thetarget and site ofaction for more drugs
marketed today or indevelopment thanany other class ofproteins

7. Appendix

Strategic collaboration Partners (cont’d)

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Our SBDD platform is also now being applied to areas outside our traditional GPCR space

Targeted GPCR Degradation

•

•

36

Technology collaboration toinitially identify novel small
molecules that target a GPCR for
degradation as potential
therapeutic agents for
gastrointestinal disorders
Further aim to generate highresolution structural information
around the GPCR-E3 ligase
complex to enhance drug
discovery efforts

Ion Channels••

Technology collaboration todemonstrate the potential of
SBDD to address diseaseassociated ion channels
Initial focus to identify novel,
highly specific drug leads forfurther development against asingle ion channel associatedwith neurological diseases

Antibody•••

Discovery collaboration
combining Twist’s synthetic
antibody libraries andbioinformatics expertise with SH’s
StaR® platform
Collaboration aims to discover
therapeutic antibodies against
GPCRs identified by SH
SH will have exclusive, full global
rights to develop andcommercialize any antibody leads
identified and directed to thetargets of interest

7. Appendix

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
Growth6
Objectives for FY2022
Shinichi Tamura, President and CEO

37

5. Strategic
Growth

6. FY2022
Goal

7. Appendix

Overview for our growth strategy

1. Business
Summary

2. Consolidated
Results

4. Organic
Growth

3. Highlight

5. Strategic
GrowthMid to long-term direction for accelerating our growth
For our IT-based drug discovery platform (StaR®/SBDD)

Organic
GrowthStrategic
Growth38

 Increase the value of the deal by out-licensing
after obtaining POC in your own clinical trials,
not in preclinical Keeping strongness to our position as world
leading IT-based drug discovery solution
provider Leverage our platform potential through new
strategic technology collaborations
 Maximize the synergy with current platform
and future alliance partner which came fromacquisition/alliance deal

For our future strategic growth- Searching for a transformative acquisition
which leverage each other In-license late-stage clinical development
products for the Japanese market

6. FY2022
Goal

7. Appendix

Priority objectives for FY2022

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
GrowthContinue to promote future growth through both organic and strategic growth
FY2022 OBJECTIVES

Organic
GrowthStrategic
Growth39

1

Execute at least one new high value collaborations and/or
co-investments

2

Generate at least one new preclinical candidates

3

Further enhance platform productivity

1

Continue to search for opportunities to acquire companies that will bringnew sources of revenue

2

Collaborate/invest in new technologies with synergies

3

In-license late-stage clinical development products for the Japanese market

6. FY2022
Goal

7. Appendix

1. Business
Summary

Priority objectives for FY2022 (cont'd)

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Promote sustainable ESG practices and policies across global business
Sustainable Development Goals adopted by the United
Nations (Sep-15)

E• Sustainability Committee promotes
efficient energy use and renewableenergy sources, and waste and water
usage reduction• Promote efficiency in discovery

40

S

Sosei Heptares is undertaking initiatives focused on
10 of the 17 Sustainable Development Goals

E

Environment

S

SocialG

Governance• Ms. Miwa Seki nominated forappointment as new External
Director• Grant funding received from
Wellcome to advance the SARS-CoV-2
Mpro inhibitor program and seek
partnering opportunity

Source: United Nations
LINK: https://soseiheptares.com/uploads/Sustainability/Sustainability_20201214_JP.pdf

G • Proposed Board of Directors – 8
members (incl. 6 external
independent)• Investment Committee and Scientific
Advisory Board provide
recommendations to the Board

7. Appendix

1. Business
Summary

Our management team

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

7. Appendix

Transition to new management will be executed after approval general shareholders' meeting
Chris Cargill

Shinichi Tamura✓

Representative Executive Officer,
President and CEO

Kieran Johnson

Kuniaki Kaga

Kazuhiki Yoshizumi
Dr. Matt Barnes

Noriaki Nagai

Tadayoshi Yasui

President, Heptares Therapeutics Ltd.

External Independent Director

External Independent Director

Representative Director President, Sosei Co.Ltd.

Rolf Soderstrom

Dr. Rob Cooke

Chief Technology Officer✓

James Taylor

Chief Business Officer

Dr. Barry Kenny

Chief Compliance Officer

Dr. David Roblin

Senior Business Advisor✓

Dr. Marcus Messenger✓

Dr. Alastair Brown✓

David Howe✓

Vice President, Business Development

Vice President, Translational Sciences

Vice President,
Non-CNS Development & Experimental Medicine

External Independent Director

External Independent
Director✓

Chief Accounting Officer

External Independent
Director

Dr. Miles Congreve
Chief Scientific Officer

Chief Financial Officer

External Independent Director

41

Hironoshin Nomura

Tomohiro Toyama

Miwa Seki✓

Representative Executive Officer,
President and CEO

Chairman of the Board

Chris Cargill

Senior Management

Executive Officers

Board of Directors✓✓

updated1. Business
Summary

7
Appendix42

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

7. Appendix

1. Business
Summary

Revenue breakdown by type (IFRS)USD (M)

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Upfront (UF)/Milestone (MS) revenue recognized in the full Financial Year1
160.8
6.4

21.0

Date

FY21 UF/MS Event

Daiichi Sankyo lead identified

1.5

Feb-21

1.1

AbbVie collab upfront

2.5

Genentech StaR® structuresolvedFeb-21

Genentech StaR® structuresolved0.5

Apr-21

Genentech StaR® structuresolved1.1

FY20 UF/MS Event

Feb-20Jun-20Jul-20

Revenue(USDm)

Revenue(USDm)

Date

Jun-20Novartis Enerzair® Breezhaler®
Japan approval
Novartis Enerzair® Breezhaler®
EU approval

1.3
5.0

May-21 Pfizer Phase 1 start

5.0

Jun-21

Biohaven Phase 1 start

0.5

5.0

Jul-21FFTC termination of exclusive
distribution rights

-4.5

2.0

Nov-21

Hisamitsu exclusive
distribution rights

4.1

Nov-20 Biohaven collab upfront

5.0

Nov-21 Takeda collab upfront

2.5

Nov-20 Biohaven share consideration

4.7

Dec-21

Neurocrine collab upfront

100.0

Dec-20

AbbVie StaR® structure solved

0.7

Other

Dec-20

Takeda StaR® structure solved

0.3

Dec-21

Genentech StaR® structuresolved0.8

Royalty
Product Sales

Dec-20

GSK collab upfront

12.5

Dec-21

GSK candidate selection

6.9

Selected revenue

4.3

Selected revenue

15.1

82.8
8.9

23.8
0

133.1

12m to 31-Dec-20

Aug-20

Takeda structure solved

0.3

Sep-20Pfizer Phase 1 start

5.0

Nov-20 Tempero Bio collab upfront
Nov-2050.1

12m to 31-Dec-21

Fair value of shares in
Tempero Bio

UF/MS
43

2. Consolidated
Results

1 Values relate to revenue recognized in the full financial year per accounting measures, as opposed to cash received in the full financial year.

7. Appendix

IFRS Income Statement Reconciliation

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Income Statement Reconciliation: ‘Cash’ basis to IFRS basis
USD (000s)
Royalties
Milestones
Goods sales
Other
Total Revenue
Cash COS
Cash R&D
Cash G&A
Other Cash Income
Cash Earnings
SBP, Depn & Amort – COS
SBP, Depn & Amort - R&D
SBP, Depn & Amort - G&A
Other Operating Costs
Operating income
IFRS Revenue – per above
IFRS COSIFRS R&D
IFRS G&A
Total IFRS OPEXIFRS Other Income
IFRS OPERATING INCOME

44

STRICTLY PRIVATE & CONFIDENTIAL

YEN (M)

FY21

FY20

FY21

FY20

20,981
133,139256
6,405
160,782(7,109)(50,034)(22,857)
46
80,829(1,356)(3,808)(12,911)(28,488)
34,265
160,782(8,465)(53,842)(35,767)(98,075)(28,442)
34,26523,82650,1338,850
82,809(5,684)(31,944)(18,687)699
27,193(1,440)(3,575)(13,488)
8,689
82,809(7,124)(35,519)(32,175)(74,818)
699
8,689

2,311
14,66728706
17,712(784)(5,511)(2,518)
5
8,904
(149)
(420)
(1,422)(3,138)3,775
17,712(933)(5,931)(3,940)(10,804)(3,133)
3,775

2,544
5,353
945
8,842
(607)
(3,411)(1,995)
75
2,904
(154)
(382)
(1,440)
928
8,842
(761)
(3,793)(3,435)(7,989)75928

7. Appendix

1. Business
Summary

StaR® Platform

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

7. Appendix

We are driving a new era of GPCR SBDD with surprising insight into ligand binding modes

Unstable
nativereceptor

DRUG TARGET PROFILESCREENING

ITERATIVE MUTAGENESISBIOPHYSICSTHERMOSTABILITYSTRUCTURE

PHARMACOLOGY
CHARACTERIZATION• GPCR drug discovery remains challenging
•

•

•

45

Low expression levels – often withcomplicated expression and secretion
pathways
Difficult purification – lose structural integrity
outside the membrane
Heterogeneity – inherently flexible; changing
conformation depending on the bound ligand

StaR®
protein

INTERPRETATION

Hit ID

LIGAND OPTIMIZATION• We introduce point mutations into a
GPCR which leads to increased
thermostability• The receptor is trapped in a relevant
conformation to match the drug
product profile• The Stabilized Receptor (StaR®) can beextracted from the membrane andpurified with function retained

70+ Stabilized
Receptors
generated in agonist
and/or antagonist
conformations

1. Business
Summary

SBDD Platform

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

7. Appendix

Collaborating with StaR®, Structure Based Drug Design(SBDD) is powerful tool for GPCR
DRUG TARGET PROFILE

Unstable
GPCR Structure

HOMOLOGY MODELCADDSTRUCTURE

STRUCTURE

BIOPHYSICSHIT SELECTION• GPCR focused SBDD
•

•

•

46

PHARMACOLOGY

Hit Identification– Virtual Screening,
Biochemical and Biophysical assays
Structure Determination – characterizebinding modes
Pharmacology – understanding mode ofaction and signalling

Medicinal
Chemistry

BIOPHYSICSOPTIMIZATION• Medicinal Chemistry working closelywith Computer Aided Drug Design(CADD)• Establish detailed Screening Cascadeand progression criteria• Typically 2 year process from starting
the target screening to entering
Candidate Selection phase

N N

Cl

NH2

N

N

F

Candidate
Selection

25+ Preclinical
Candidates
identified forin-house andcollaboration
pipelineMajor indication for GPCR

1. Business
Summary

2. Consolidated
Results

Neuroscience, Immunology and GI are our areas of focus~400

GPCR targets
active indiseases2~34%

of FDAapprovals
target GPCRs1

27%
of global
sales
are GPCR
drugs1

47

GPR52

KOR

GASTROINTESTINAL DISEASES

7. Appendix

Ox2

mGlu5

GPR17 GPR88

IMMUNOOGY/ONCOLOGY

A2a
A2b
EP4

CGRP

GLP2/1
C3a
C5a

CXCR4
ImmuneOncology

6. FY2022
Goal

Ox1

M4

M1

ENORMOUS UNTAPPEDPOTENTIAL IN THESE THERAPY
AREAS FOR SBDD - LED
APPROACHES

5. Strategic
GrowthCNS Disorders and
Neuro-inflammation

NEUROLOGICAL DISORDERS

GPCRs are active in a wide range of disease areas,
and offer broad therapeutic potential

4. Organic
Growth

3. Highlight

PAR2

CCR8

BLT2
H4
EP4
GPR35

GLP2
CXCR3
FPR2
CCR6
Immune and GI
DisordersSignificant opportunity to target new first-in-class
and/or improved best-in-class GPCR medicines

Sources: 1 “Unexplored opportunities in the druggable human genome”, Nature Reviews, 2016 ; 2 “Trends in GPCR in Drug Discovery – new agents, targets and indications”, Nature Reviews, 2017

1. Business
Summary

2. Consolidated
Results

3. Highlight

4. Organic
GrowthSARS-CoV-2 protease inhibitors competition landscape

5. Strategic
Growth

6. FY2022
Goal

We need several option for drug resistance and aiming one of the best class therapy
Program

PAXLOVID™

S-217622

SH-879Administration

Oral

Oral

Oral

Number of doses

twice a day

once a day

once a day

Features

Requirement for ritonavir
combination boost exposure

Not require co-dosing withritonavir

Not likely require co-dosing withritonavir

Phase

FDA authorized the emergency
usePhase 2/3

Potential clinical candidate
identified
suitable for further development•

 Exhibits potent in vitro antiviral Comparable antiviral activity
 Phase 2a shows followings
activity against SARS-CoV-2
to Pfizer’s PF-07321332 against SARS• On day 4 (after the 3rd dose), theCoV-2 in cell based assays
proportion of subjects with positive Good tolerability, no safety findings
Low in vitro clearance, superior in vivo
viral titer decreased by
up to 500mg dose 2x daily withclearance and high plasma exposure
approximately 60-80%, compared toritonavir/10 days in healthy
from oral dosing
the placebo group
volunteers• No cases of exacerbation required Interim data of Phase 2/3 EPIC-HR
hospitalization or similar therapy as
Study was announced in November
hospitalization were found in the S2021 - Reduced Risk of Hospitalization
217622 groupor Death by 89%•

Key data findings

48

Receives Grant Funding
from Wellcome on Dec
2021

Source: Company announcements; Company websites•

Funding comes throughthe Covid-19 Therapeutics
Accelerator, which was
set up by Wellcome, Bill &Melinda Gates
Foundation and
Mastercard
In-house program fundedby Wellcome through theCovid-19 Therapeutics
Accelerator
Currently advancing thepre-clinical developmentof novel oral anti-viralsmall molecules targetingthe main protease of
SARS-CoV-2 (Mpro) as
potential treatments for
COVID-19

7. Appendix

1. Business
Summary

In vitro data of SH-879

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

SH-879 represents an excellent opportunity for further development as an oral drug for thetreatment of COVID-19
M Pro enzyme inhibition

TARGET PRODUCT PROFILEPROGRAM STAGE
Excellent progress has been made in >1 chemical
series of inhibitors since project initiation Apr-20% Inhibition

80

49

boceprevir

20
0
-10

Next Step

PF-07321332

40

-8

-6

Compound (Log M)-4-2

Proactively seeking funding via charitableorganizations and trusts / other philanthropic
sources of funding, to rapidly progress ourmolecules

Coronavirus inhibition by SH-879
150

EC50: 540 nM
EC50: 110 nM

125

OC43
229E

100

Cytotox

75
50
25
0
-25

-9

-8

-7

-6

Compound (Log M)-5-4

SARS-CoV-2 inhibition% Live Infected Cells

150

EC50: 82 nM
EC50: 93 nM

125SH-879
PF-07321332

100
75
50
25
0
-25

1 * Regardless of pandemic/endemic status. List of LDCs as defined by the United Nations.

SH-879

60

-20
-12

Potential clinical candidates have now been
identified, suitable for further development
Promising PK results from SH-879, our mostadvanced asset (see adjacent charts for cell-based
antiviral assay data)

IC50: 14 nM
IC50: 18 nM
IC50: 4.9 μM

100% Live Infected Cells

Once or twice daily oral agent for treatment of
SARS-CoV-2 viral infection dosed immediately
after a positive test result and for up to 2 weeks
thereafter, with potential for broader application
for intervention of associated human coronavirus
and related viral infections.

120

-9

-8

-7

-6

Compound (Log M)-5-4Program is available for global partnering toaccelerate progress to human clinical trials
Significant inbound interest received
and under assessment
Program remains a core ESG project –We will not profit/receive economics fromsales to Least Developed Countries*. For allother countries, we will reinvest a portion of
any profits received towards ourGroup’s ESG initiatives

7. Appendix

1. Business
Summary

SZ treatment system

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

M4 agonist is 4th-gen candidate aiming to be a highly effective and safer treatment for SZ
Typicalantipsychotic

Efficacy

Safety50

M4 agonist is
4th-gen candidate

Atypical antipsychotics

MoA

D2 Ant

D2 Ant+5-HT Regulator

D2 partial Ag+ 5-HT Regulator

M4 Agonist***Typical medicine(Peak sales)

HaldolZyprexa($5,000M+)

Abilify($6,100M)

KarXT, CVL-231
HTL’878

Generation

1st

2nd

3rd

4th

Positive
symptoms

Number of patients

+++

+++

+++

+++

Negative
Symptom

Number of patients

-

+

+

++

Cognitive
impairment

Number of patients

16M*

-

+

+

++

Extrapyramidal
symptoms**

-

++++

++

+

-

Weight gain

-

+

++++

+

-

20M*

11.5M**As 1 patient can have several symptoms, number of patients in 3 symptoms is overlapping**Drug-induced movement disorders including involuntary or uncontrollable movements. tremors. muscle contractions. It is said to be related with D2
receptor occupancy balance.
***Expected efficacy and expected safety derived from ongoing clinical trials of KarXT and CVL-231.
Source：P T. 2014 Sep; 39(9): 638–645, J Clin Psychiatry. 2010;71(3):280–286, Schizophr Bull. 2010 Jan; 36(1): 36–42 and EvaluatePharma• Potential Best-in•

Class therapy witha novelmechanism
Improved efficacy
and Safety

7. Appendix

1. Business
Summary

Estimation of potential market size

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Market size and peak sales of our development products in the preclinical stage and beyond
Category

Neurologicaldisorders

Indication2

Market Size

Our Products

Individual Products

Dementia~55 million$7,266M (2010)$3,913M (2009/Aricept)

M1 agonist, M1/M4 agonist

Schizophrenia~20 million$20,691M (2011)$6,198M (2013/Abilify)

M4 agonist, M1/M4 agonist

Substance use disorders

Narcolepsy
Other~10.4 million1~3 million-

Cancer--$2,014M (2020)
-

-

-

-

$1,742M (2020/Xyrem)--mGlu5 NAM
OX2 agonist
CGRP antagonist, GPR52 agonist~42 million$152,495M (2020)$14,380M (2020/Keytruda)

A2a antagonist, EP4 antagonist, CXCR4 mAb

Immunological Inflammatory bowel disease
disorders~10 million$19,966M (2020)$7,809M (2020/Humira)

CCR6 antagonist, GPR35 agonist, EP4 agonist

Atopic Dermatitis~13.3 million$4,127M3 (2020)$3,204M (2020/Dupixent)

H4 antagonist, PAR2 mAb

T2DM/Obesity~420 million$48,861M (2020)$6,652M (2014/Lantus)

GLP1 agonist

Anorexia~2.9 million

-

-

-

-

MC4 antagonist

SARS-CoV-2~240 million

-

-

-

-

Mpro

Other

合計

51

Peak Sales(USD million)

Number ofPatients$255,420M$43,898M

Source (Number of patients)：World Health Organization、The European Federation of Crohn‘s & Ulcerative Colitis Associations (EFCCA)、Narcolepsy Network, Inc.、GBD 2015 Disease and Injury Incidence
and Prevalence Collaborators (October 2016). “Global, regional, and national incidence, prevalence, and years lived with disability for 310 diseases and injuries, 1990-2015: a systematic analysis for the
Global Burden of Disease Study 2015”. Lancet. 388 (10053): 1545–1602 1 The number of patients with drug addiction
Source (Peak Sales):Sales of each indications are extracted form Evaluate Pharma’s data of sales by disease and sales by individual products (as of 18 Jan. 2022). 2 Sosei Heptares may target one segment in
the market for specific diseases. 3 Since there is no applicable indication category, the market size of “Eczema” is stated. Current market size for Atopic Dermatitis may be larger than stated above.

7. Appendix

1. Business
Summary

Partnered Pipeline
CompoundTarget / Mechanism of Action

Traditional Out-licensing Collaborations
Seebri® Breezhaler®
LAMA

52

Modality

Indication

SME

COPD

Ultibro® Breezhaler®

LAMA+LABA

SME

COPD

Enerzair® Breezhaler®

LAMA+LABA+ICS

SME

AsthmaORAVI®

Antifungal agent miconazole

SME

Oropharyngeal candidiasis

Imaradenant1

Adenosine A2a ant. combo

SME

mCRPC

HTL’878

Muscarinic M4 agonist

SME

Neurology diseases

Not disclosed

Muscarinic M1 agonist

SME

Neurology diseases

Not disclosed

Muscarinic M1/M4 agonist

SME

Neurology diseases

PF-07081532

GLP-1 agonist

SME

T2DM / ObesityPF-07054894

CCR6 antagonist

SME

Inflammatory bowel disease

PF-07258669

MC4 antagonist

SME

Anorexia

BHV3100

CGRP antagonist

SME

Neurology diseases

Not disclosed

GPR35 agonist

SME

Inflammatory bowel diseaseNot disclosed

Multi target

SME

Multiple indications

Not disclosed

Multi target

SME/LME

Multiple indications

Not disclosed

Multi target

SME/LME

Gastrointestinal and otherNot disclosed

Single target

SME

Inflammatory diseases

Partner

2. Consolidated
Results

Disc.

4. Organic
Growth

3. Highlight

PCC

Ph1

Note: SME = small molecule. LME = large molecule. Seebri®, Ultibro®, Enerzair® and Breezhaler® are registered trademarks of Novartis AG. 1 AstraZenenca have removed the A2a program from their clinicalpipeline as at Q3 2021

Ph2

5. Strategic
GrowthPh3

6. FY2022
Goal

App

7. Appendix

Mkt

1. Business
Summary

Partnered Pipeline (cont’d)CompoundTarget / Mechanism of Action

Modality

Indication

Co-development / Profit-share Collaborations
KY1051CXCR4 mAb

mAb

Immuno-oncology

Not disclosed

PAR-2

PeptideInflammatory diseases

Not disclosed

Targeted Protein Degradation

SME

Gastrointestinal disorders

Not disclosed

AI-Augmented Drug Discovery

SME

Neurology diseases

Not disclosed

Ion Channel Drug Discovery

SME

Neurology diseases

Not disclosed

Multi target AI-powered

SME/LME

Immune diseases

Not disclosed

Antibody Discovery

mAb

Disease-relevant GPCR targets

Not disclosed

Multi target AI-powered

SME/LME

Immune diseases

SME

Substance use disorders

Co-owned Investments

53

TMP301mGlu5 NAM

Not disclosed

OX1/OX2 agonist (oral and intranasal) SME

Note: SME = small molecule. LME = large molecule

Narcolepsy

Partner

2. Consolidated
Results

Disc.

4. Organic
Growth

3. Highlight

PCC

Ph1

Ph2

5. Strategic
GrowthPh3

6. FY2022
Goal

App

7. Appendix

Mkt

1. Business
SummaryIn-house Pipeline
CompoundTarget / Mechanism of Action
In-house Programs (Not yet partnered)

Modality

Indication

Not disclosed

H4 antagonist

SME

Atopic Dermatitis

Not disclosed

EP4 antagonist

SME

Immuno-oncology

Not disclosed

GPR52 agonist

SME

Neurology diseases

Not disclosed

EP4 agonist

SME

Inflammatory bowel diseaseNot disclosed

PAR-2 mAb

mAb

Atopic Dermatitis

SH-879SARS CoV-2 Mpro

SME

Coronaviruses

Multiple programs

Not disclosed

SME/LME

Neurology diseases

Multiple programs

Not disclosed

SME/LMEGI and Inflammatory diseases

Multiple programs

Not disclosed

SME/LME

Immunology diseases

In-house Programs (No longer internally funded. Targeting academic / industrial partnership)54

HTL’310

SSTR5 agonist

PeptideHypoglycaemic disorders

HTL’097

GLP-1 antagonist

PeptideHypoglycaemic disorders

HTL’023

Dual GLP-2/GLP-1 agonist

PeptideIntestinal failure / NASH

Not disclosed

Apelin agonist

PeptidePulmonary Arterial Hypertension

HTL’641

Dual orexin antagonist

SME

Insomnia and sleep disorders

Note: SME = small molecule. LME = large molecule

Originator

2. Consolidated
ResultsDis

4. Organic
Growth

3. Highlight

PCC

Ph1

Ph2

5. Strategic
GrowthPh3

6. FY2022
Goal

App

7. Appendix

Mkt.

1. Business
Summary

Glossary

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Basic Terminology/Technology
GPCR

G Protein-Coupled Receptor

There are about 800 types of GPCRs in the human body. While 400 of them are known to be potential drug targets, about 300 of them are not yet drugged

StaR

Stabilized Receptor

Sosei Heptares’ proprietary technology to stabilize a GPCR by engineering a small number of single point mutations outside of the ligand-binding site. It enables to identify the structureof GPCRs to be used for SBDD drug discovery as well as antibody drug discovery as antigens
A method to design drugs on a computer base based on the analysis of the three-dimensional structure of the drug target (e.g., protein receptor)

SBDD

Structure-Based Drug Design

TPD

Targeted Protein Degradation

Drugs that promote the degradation of target proteins (e.g., receptors) in cells and aim for therapeutic effects by reducing disease-causing proteins

PAM

Positive Allosteric Modulator

A regulator that binds to unusual active sites (allosteric sites) on the receptor to increase the affinity and effect of the agonist

NAM

Negative Allosteric Modulator

A regulator that binds to an unusual active site on the receptor (allosteric site) and reduces the affinity and effectiveness of the agonist

Ag

AgonistA therapeutic drug that binds to a receptor and activates an intracellular signaling system similar to biological substances

Ant

Antagonist

A therapeutic drug that suppresses biological reactions by binding to receptors and preventing them from binding to biological substances

PK

Pharmacokinetics

Research and testing on the relationship between drug dosage and blood concentration. Mainly describes the rate process of ADME
Research and testing on the relationship between drug concentration and pharmacological effects

PD

Pharmacodynamics

ADME

Absorption, Distribution, Metabolism and Excretion A series of process in the absorption of drugs into the body, distribution within the body, metabolism in the liver and other organs, and excretion in the kidneys and other organs

POM

Proof of Mechanism

Proof of mechanism of action, mainly through biomarkers. It can suggest the possibility of efficacy in fewer cases than POC

POC

Proof of Concept

Proof of a therapeutic concept, primarily through clinical efficacy and safety

AchAcetylcholine

A neurotransmitter released from the peripheral parasympathetic and motor nerves to transmit nerve stimuli

IND

Investigational New Drug

Information packages for development candidates to be submitted to the U.S. Food and Drug Administration (FDA) at the time of initiation of clinical trials

Ph1

Phase1

A study in humans. The main purpose is to confirm the safety of the drug candidate mainly by healthy volunteers.

Ph2

Phase2A study in humans. The main purpose is to confirm the efficacy of the drug candidates on a small scale (however, the number of patients varies greatly depending on the disease)

Ph3

Phase3A study in humans. The main purpose is to determine the efficacy of the drug candidates on a large scale (however, the number of patients varies greatly depending on the disease)

NDA

New Drug Application

An application to the U.S. Food and Drug Administration (FDA) for approval to market a new drug
Disease/Drug

55

LAMA

Long Acting Muscarinic Antagonist

An inhalant that dilates bronchial tubes and improves respiratory function by inhibiting the action of acetylcholine receptors (M3), which increase parasympathetic nerves.

LABA

Long Acting Beta2-Agonist

An inhalant that improves respiratory function by stimulating sympathetic beta2 receptors to dilate the bronchi.

ICS

Inhaled Corticosteroid

An inhalant that suppresses airway inflammation to prevent coughing attacks and other symptoms caused by asthma, also promotes the action of beta 2 stimulants and improve airway
hyperresponsiveness.

mCRPC

Metastatic Castration–Resistant Prostate Cancer

Cancer that has spread (metastasized) beyond your prostate gland and for which hormone therapy is no longer effective in stopping or slowing the disease.

COPD

Chronic Obstructive Pulmonary Disease

A group of diseases that causes damage to the bronchi and lung due to smoking or inhalation of toxic substances, resulting in breathing problems.

AD

Alzheimer’s Disease

Alzheimer's disease is a progressive neurologic disorder that causes the brain to shrink (atrophy) and brain cells to die, the most common cause of dementia .

DLB

Dementia with Lewy Bodies

Protein deposits, called Lewy bodies, develop in nerve cells in the brain regions involved in thinking, memory and movement (motor control), the second most common type of dementia.

7. Appendix

1. Business
Summary

Glossary (cont’d)

2. Consolidated
Results

3. Highlight

4. Organic
Growth

5. Strategic
Growth

6. FY2022
Goal

Drug discovery target

56

M1

Muscarinic M1 Receptor

M4

Muscarinic M4 Receptor

One of the five subtypes M1 to M5 of muscarinic acetylcholine receptors, known to be involved in behavior and dopamine release.

CGRP

Calcitonin Gene-Related Peptide

CGRP is thought to be involved in vasodilation, decreased heart rate, and increased myocardial contractility via receptors.

A2A

Adenosine A2A receptor

One of the four subtypes of adenosine receptors, A1, A2A, A2B, and A3. It is expressed in many tissues and has multiple functions such as neural activity, vasodilation, and immune
regulation.

GLP-1

Glucagon-like Peptide 1

GLP-1 is secreted by gastrointestinal cells when we eat, and is involved in insulin secretion from the pancreas and appetite regulation in the central nervous system.

CCR6

Chemokine Receptors 6

A type of Β chemokine receptor that responds to chemokines generated during inflammation. It is believed to be involved in inflammation and immunity mainly by it's regulating the
migration activity of leukocytes into inflamed tissues.

MC4

Melanocortin 4 Receptor

MC4 is expressed in the central nervous system and is the main receptor that mediates the appetite suppressing effect of alpha-melanocyte stimulating hormone.

GPR35

G Protein-Coupled Receptor 35

Orphan receptors - expressed mainly in immune and gastrointestinal tissues and is thought to be involved in areas of gastrointestinal tract, cardiovascular, inflammation, and central
nervous system.

CXCR4

CXC Motif Chemokine Receptor 4

CXR4 induces migration of cancer cells and is known to be important in metastasis process.

mGlu5

Metabotropic Glutamate Receptor 5

One of the metabolic glutamate receptors expressed in the central nervous system. Glutamate is known to be the most abundant excitatory neurotransmitter in the human nervous
system.

OX1、OX2

Orexin 1 Receptor、Orexin 2 Receptor

Orexins are a class of neuropeptides that are known to play a role in stabilizing wakefulness and inhibiting sleep.

GPR52

G Protein-Coupled Receptor 52

An orphan receptor that is highly expressed in the striatum- may play a role in the regulation of frontal lobe-striatal and limbic dopamine in psychiatric and neurological disorders.

H4

Histamine H4 Receptor

H4 is particularly expressed in immune system cells and is known to be involved in inflammation and allergy.

EP4

Prostaglandin EP4 Receptor

EP4 suppresses innate and acquired immunity and is known to induce tumor progression
PAR2 is known to be associated with many physiological and pathophysiological processes such as inflammation, tumor metastasis, gastrointestinal motility, pain, and itching

One of the five subtypes M1 to M5 of muscarinic acetylcholine receptors, known to be involved in learning and memory.

PAR2

Protease-Activated Receptor 2

SSTR5

Somatostatin Receptor 5

SSTR is expressed mainly on small intestinal endocrine cells and pancreatic beta cells, inhibits the secretion of gastrointestinal hormones such as GLP-1 and PYY by binding somatostatin.

GLP-2

Glucagon-like Peptide 2

Intestinal GLP-2 is secreted together with GLP-1 during nutrient intake, and repairs and protects the intestinal tract.

Mpro

SARS-CoV-2 Main Protease

An enzyme essential for the replication of Sars-CoV-2(COVID-19 cause virus). One of the target proteins for the development of antiviral drugs.

D2

Dopamine Receptor D2

Dopamine is a neurotransmitter in the brain involved in motor control, motivation, and learning - known to be associated with Parkinson's disease and schizophrenia.

5-HT

5-Hydroxytryptamine Receptor

5-hydroxytryptamine (serotonin), as a transmitter in the central nervous system, is thought to play an important role in the regulation of brain function.

Orphan receptor

A receptor whose existence is known based on genetic analysis, but for whom no ligand has been identified.

LigandA ligand is a molecule that binds to a specific receptor in vivo, such as hormones, neurotransmitters. For example, the ligand for muscarinic receptors is acetylcholine.

7. Appendix

Locations
SOSEI HEPTARESPMO Hanzomon 11F

Steinmetz Building

North West House

2-1 Kojimachi, Chiyoda-ku

Granta Park, Cambridge

119 Marylebone RoadTokyo 102-0083

CB21 6DG

London NW1 5PU

Japan

United Kingdom

United Kingdom