Modalis Therapeutics Reports Operational Highlights andSecond Quarter 2024 Financial Results
07-Aug-2024 TOKYO & Waltham, Mass.- Modalis Therapeutics Corporation ("Modalis" 4883.T TSE), apioneer in developing cutting-edge solutions for rare genetic diseases through its proprietary
CRISPR-GNDM® epigenetic gene modification technology, today announced its financial results forthe second quarter ended June 30, 2024, alongside recent operational milestones.
“The second quarter provided an opportunity to update the world on the progress of our lead program,
MDL-101, as we prepare for clinical trials. Preclinical data from mouse and monkey studies werepublished in a paper in May and reported at conferences in June and July,” said Haru Morita, Chief
Executive Officer of Modalis. “The response to the results presented in the paper has been
overwhelming, and we have received inquiries from patients suffering from LAMA2-CMD, theirfamilies, and their physicians from around the world to participate in the clinical trial. In addition,
multiple inquiries from pharma/biotech companies about our pipeline and technology platform.”
As a result of business restructuring reported in April and June, and of other factors, the Company has
announced that it will push back the IND filing target to 2025, while it has filed Orphan Disease
Designation and Rare Pediatric Disease Designation applications with the FDA at the end of July andAugust, respectively, which are expected to be reviewed for the rarity of disease and medical
relevance of the target disease. If accepted, the application will provide a number of economic
benefits, including tax deductions for clinical trial costs and an exclusive seven-year market
exclusivity period after product launch.
In the area of central nervous system (CNS) diseases, as an attempt to expand access to technologythat can cross the blood-brain barrier (BBB), we have been collaborating with JCR Pharma since lastyear to combine their capsid technology, JBC-AAV, with our CRISPR-GNDM® technology based
payload, which has obtained excellent preclinical PoC in various target diseases. The company alsoannounced the signing of a memorandum of understanding for research collaboration to develop nextgeneration therapeutics for Alzheimer’s disease with Genixcure, a South Korean emerging company,
on modified capsid technology based on AI technology. As BBB-crossing capability is the commonbottleneck for gene therapy targeting CNS diseases and is also a rapidly innovating capsid
technology, we believe that access to these new technologies will replicate the breakthroughs we havedelivered in muscle diseases with increased efficacy and reduced toxicity in CNS diseases.

Recent Preclinical and Business Highlightsl

MDL-101 is advancing to INDØØØl

Due to the reallocation of resources from the business restructuring, the forecast for IND filing has been moved
back to 2025.
Established manufacturing process and analytical methods to achieve stable production and quality control ofmuscle tropic engineered AAV vectors
ODD and RPDD applications filed to FDA

Other programsØØl

Research collaboration
ØØlContinue to work with JCR Pharma in the research collaboration announced last year that aim to validate theapproach to address CNS targets by combining JCR’s BBB-crossing capsid, JBC-AAV, and our payload base on
CRISPR-GNDM technology.
Also announced the signing of a memorandum of understanding for research collaboration to develop nextgeneration therapeutics for Alzheimer’s disease with Genixcure, a South Korean emerging company, on amodified capsid technology based on AI technology. (July)IP updatesØØlReassess the value of other programs and the time and cost to reach future milestones, and consider
possibilities for collaboration and derivation.
The Partnership with Ginkgo Bioworks brings a diverse array of partners and opportunities in a wide range ofareas, spanning AI, genetic medicines, biologics, and manufacturing.

GNDM-UTRN(MDL-201) patent granted in China (June)
GNDM-DM1(MDL202) patent issued in China (June)

Conference and presentation
ØØ

Past presentationØPublished MDL-101 preclinical data at BioRxiv in May (https://doi.org/10.1101/2024.05.03.592438)
Ø
4th Annual Next Generation Gene Therapy Vectors Summit (June 12-14)
Ø
Cell and Gene Therapy Summit 2024 (July 8-10)
Coming presentation
ØBioprocessing Summit (Aug 20)
ØGene Therapy Immunogenicity Summit (Aug 22)

Second Quarter 2024 Financial Results:

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Cash Position: Cash and deposits as of June 30, 2024, was ¥1,278 million, compared to¥1,883 million as of December 31, 2023, a decrease of ¥605 million. The decrease in Cashand deposits was primarily due to R&D Expenses and G&A Expenses.
Research & Development (R&D) Expenses: R&D expenses were ¥716 million for the six
ended June 30, 2024, compared to ¥906 million for June 30, 2023, a decrease of ¥190
million. Decreases in R&D expenses were primarily due to decreases in development costs
associated with the advancement of the Company’s proprietary GNDM platform andproduct candidates.
General & Administrative (G&A) Expenses: G&A expenses were ¥122 million for the sixended June 30, 2024, compared to ¥138 million for June 30, 2023, a Decrease of ¥16 million.
Decreases in G&A expenses were primarily due to Decreased personnel costs.
Net Loss: Net Loss was ¥781 million for the six ended June 30, 2024, compared to ¥1,033
million for June 30, 2023.
Please refer to 1Q Consolidated Financial Results disclosed according to Japanese accounting
rules in the English version below.

About Modalis:
Modalis Therapeutics is developing precision genetic medicines through epigenome editing. Modalis
is pursuing therapies for orphan genetic diseases using its proprietary CRISPR-GNDM technology
which enables the locus-specific modulation of gene expression or histone modification without theneed for double-stranded DNA cleavage, gene editing, or base editing. Modalis focuses primarily on
genetic disorders caused by loss of gene regulation – resulting in excess or insufficient protein
production – which includes more than 660 genes that are currently estimated to cause humandisease due to haploinsufficiency. Headquartered in Tokyo with laboratories and facilities inWaltham, Massachusetts. For additional information, visit www.modalistx.com.

Forward-Looking Statements:
This document has been prepared by Modalis Therapeutics corporation and Modalis Therapeutics
Inc. (the “Companies”) solely for information purpose only. This document does not constitute orform part of and should not be construed as, an offer to sell or issue or the solicitation of an offer tobuy or acquire securities of the Companies in Japan, the United States or any other jurisdictions. The
information contained herein is based on current economic, regulatory, market trends and otherconditions. The Companies make no representation or guarantee with respect to the credibility,accuracy or completeness of the information herein. The information contained herein may change
without prior notice. You may not publish or use this document and the contents thereof for any
other purpose without a prior written consent of the Companies. Furthermore, the information on
future business results are forward-looking statements. Forward-looking statements include but notlimited to expressions such as "believe", “expect", "plan", "strategic", "expect", "anticipate","predict" and "possibility", as well as other similar expressions to explain future business activities,achievements, events and future conditions. Forward-looking statements are predictions about thefuture that reflect management's judgment based on currently available information. As such, theseforward-looking statements are subject to various risks and uncertainties that could cause actual
results to differ materially from those expressed in or suggested by the forward-looking statements.
Therefore, you may not rely entirely on forward-looking statements. The Companies do not assume
any obligation to change or correct any forward-looking statements in light of new information,
future events or other findings. This document and its contents are confidential and are being
provided to you solely for your information and may not be retransmitted. This presentation is being
furnished to you solely for your information and may not be reproduced or redistributed to any
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responsibility for the accuracy and appropriateness of such data and indicators presented in thisdocument.

Contacts

Modalis Therapeutics
Sawako Nakamura
media@modalistx.com

Consolidated Financial Results
for the Six Months Ended June 30, 2024
[Japanese GAAP]
August 7, 2024
Company name: Modalis Therapeutics Corporation
Stock exchange listing: Tokyo Stock Exchange
Code number: 4883
URL: https://www.modalistx.com/en/Representative: Haruhiko Morita, CEO and Representative Director
Contact: Yosuke Nakashima, Executive Officer
Phone: +81-3-6231-0456
Scheduled date of filing quarterly securities report: Aug 13, 2024
Scheduled date of commencing dividend payments: Preparation of supplementary material on financial results: Yes
Holding of financial results briefing: Yes (for securities analysts and institutional investors)(Amounts of less than one million yen are rounded down.)
1. Consolidated Financial Results for the Six Months Ended June 30, 2024 (January 1, 2024, toJune 30, 2024)(1) Consolidated Operating Results (% indicates changes from the previous corresponding period.)
Profit attributable
Operating revenue Operating income
Ordinary income
to owners ofparent
Six months ended Million yen%
Million yen%
Million yen%
Million yen%
June 30, 2024
(838)
(780)
(780)
June 30, 2023
- (100.0)(1,044)(995)(1,033)(Note)Comprehensive income:Six months ended June 30, 2024: ¥ (772) million [-%]
Six months ended June 30, 2024: ¥ (1,034) million [-%]
Basic earnings
per share

Diluted earnings
per shareSix months ended
Yen
Yen
June 30, 2024
(21.98)June 30, 2023
(34.70)(Notes)For diluted earnings per share, the figure is not presented as the Company recorded basic loss per sharealthough the Company has dilutive shares.
(2) Consolidated Financial Position
Total assets
Million yen

Net assets
Million yen

As of June 30, 2024
1,409
1,112
As of December 31,2,025
1,380
2023
(Reference) Equity: As of June 30, 2024: ¥1,096million
As of December 31, 2023: ¥1,353million

Capital adequacy
ratio%

77.8
66.8