Dr. William Rice reports

APTOSE REPORTS RESULTS FOR THE FIRST QUARTER 2023

Aptose Biosciences Inc. has released financial results for first quarter ended March 31, 2023, and has provided a corporate update.

"Tuspetinib's significant response rates among patients with relapsed or refractory acute myeloid leukemia (R/R AML) harboring difficult-to-treat adverse mutations, along with its favourable safety record, have driven investigator enthusiasm for our Aptivate trial of tuspetinib and the rate of accrual in both the monotherapy and combination treatment arms has been brisk," said William G. Rice, PhD, chairman, president and chief executive officer. "While it is still too early to report confirmed responses in the Aptivate trial, it is moving in the right direction. We look forward to providing more colour as data evolve, including an update during the EHA time frame next month, and reporting more complete data later in the year. Also, the favourable safety record of tuspetinib continues, confirmed by our most recent safety review. Tuspetinib's safety profile, especially the absence of prolonged myelosuppression in responding patients, coupled with its breadth of activity on diverse mutational subgroups of AML, may elevate tuspetinib to become the ideal drug for combination therapy in multiple lines of therapy."

Key corporate highlights:

• Tuspetinib Aptivate expansion trial -- in the Aptivate phase 1/2 clinical trial of tuspetinib, a once-daily oral agent with a unique kinase targeting pattern being developed for the treatment of patients with R/R AML, the doublet combination treatment arm of tuspetinib with venetoclax (TUS/VEN) recently initiated dosing, has been well tolerated in patients during the early weeks of dosing, and early blast reductions have been observed. In parallel, patients were accrued rapidly to the Aptivate monotherapy arm, which was designed to confirm tuspetinib activity in specific mutationally defined AML populations, including TP53-mutant patients and FLT3-mutant patients who have been failed by a prior FLT3 inhibitor. Aptose has a growing network of U.S. and international clinical sites up and running, and the Aptivate trial expects to enroll up to 100 patients, inclusive of a large spectrum of the R/R AML population.
• Tuspetinib safety review -- in a recent safety cut of more than 70 patients treated with tuspetinib to date, it continued to show a favourable safety record with no drug-induced myelosuppression upon prolonged dosing in responding patients with only mild adverse events (AEs), no drug discontinuations from drug-related toxicities and no dose-limiting toxicities (DLTs) up to the dosage of 160 milligrams per day. The unique kinase targeting pattern of tuspetinib avoids many of the typical toxicities observed with other kinase inhibitors and has no drug-related serious adverse events, drug-related deaths, no differentiation syndrome, no drug-related QT prolongation and no observed muscle destruction. Aptose has identified a safe therapeutic range with a broad therapeutic window, spanning the dose levels of 40, 80, 120 and 160 milligrams.
• Tuspetinib dose escalation and exploration arms of the phase 1/2 trial -- the phase 1/2 clinical trial of tuspetinib dose escalation and exploration arms are complete, with more than 70 R/R AML patients having received once-daily oral tuspetinib over a dosage range of 20 mg to 200 mg. Formal clinical responses spanning from complete remissions (CR) to CRs with partial hematologic recovery (CRh), incomplete platelet recovery (CRp), incomplete hematologic recovery (CRi) or partial remission (PR) were observed among R/R AML patients with adverse mutations and co-mutations in the RAS, TP53, FLT3, MLL, IDH, NPM1, DNMT3A, RUNX1 and various splicing factors, among other genes. Extensive dose exploration allowed identification of 40 mg, 80 mg, 120 mg and 160 mg as safe and effective doses for the treatment of R/R AML patients and the selection of 80 mg as the planned recommended phase 2 dose (RP2D).
• Luxeptinib G3 continuous dosing -- dosing of the G3 formulation of luxeptinib, an oral, lymphoid and myeloid kinase inhibitor, in the continuing phase 1 a/b clinical trial in patients with R/R AML continues. Pharmacokinetic (PK) data show the 50 mg dose of luxeptinib G3 enables greater absorption relative to the original G1 formulation and delivers roughly equivalent exposures to 900 mg of the G1 formulation. If findings continue as anticipated, Aptose plans to escalate the dose of G3 and seek a dose with robust safety and higher exposure levels.

Expected milestones:

• End of phase 1 (EOP1) meeting with U.S. Food and Drug Administration (FDA) -- scheduled to ensure agreement on tuspetinib clinical study parameters and next steps (Q2 2023);
• European Hematology Association (EHA) 2023 Congress -- plan to present clinical findings circa EHA to include tuspetinib dose escalation/exploration findings in R/R AML patients and early/preliminary findings in patients dosed with monotherapy (TUS) and doublet (TUS/VEN) in the Aptivate trial (June, 2023);
• European School of Haematology (ESH) meeting -- plan to present more mature tuspetinib clinical data set (October, 2023);
• 65th American Society of Hematology (ASH) annual meeting and exposition -- plan to present more robust clinical data set with tuspetinib (December, 2023);
• Year-end 2023 -- plan to discuss strategies for potential future monotherapy accelerated development, doublet phase 2 development and triplet pilot development (Q4 2023).

The net loss for the three months ended March 31, 2023, was $13.7-million (15 cents per share) compared with $11.5-million (12 cents per share) for the three months ended March 31, 2022.

The increase in net loss for the three months ended March 31, 2023, compared with the three months ended March 31, 2022, was primarily a result of an increase in research and development costs of $1.4-million and an increase in general and administrative costs of $1.2-million, offset in part by an increase in interest income of $400,000.

• Total cash and cash equivalents and investments as of March 31, 2023, were $35.7-million. Based on current operations, the company expects that cash on hand and available capital provide the company with sufficient resources to finance planned company operations, including research and development through March of 2024.
• Common shares outstanding on May 8, 2023, were 93,653,662.

Research and development expenses

The research and development expenses for the three months ended March 31, 2023, and 2022, were as noted herein.

Research and development (R&D) expenses increased by $1.4-million to $8.8-million for the three months ended March 31, 2023, as compared with $7.4-million for the comparative period in 2022. Changes to the components of the company's R&D expenses are primarily as a result of the activities noted herein.

• Program costs for tuspetinib were $4.8-million for the three-month period ended March 31, 2023. The company in-licensed the development rights of tuspetinib in the fourth quarter of 2021 and assumed sponsorship, and the related costs, of the study effective Jan. 1, 2022. The higher program costs for tuspetinib in the current period represent the enrolment of patients in the company's Aptivate clinical trial, its healthy volunteer trial and related expenses.
• Luxeptinib program costs decreased by approximately $1.5-million, primarily due to lower manufacturing costs as a result of the current G3 formulation requiring less API than the prior formulation, partially offset by higher clinical trial costs, mostly related to higher contractor costs to support the trials.
• Program costs for APTO-253 decreased by approximately $83,000 due to the company's decision on Dec. 20, 2021, to discontinue further development of APTO-253.
• Stock-based compensation decreased by approximately $294,000 in the three months ended March 31, 2023, compared with the three months ended March 31, 2022, primarily due to stock options granted with lower grant date fair values, in the current period.

Conference call and webcast

Date: Monday, May 8, 2023

Time: 5 p.m. ET

*Analysts interested in participating in the question-and-answer session will preregister for the event to receive the dial-in numbers and a unique PIN, which are required to access the conference call. They also will have the option to take advantage of a call me button and the system will automatically dial out to connect to the Q&A session.

The audio webcast also can be accessed through a link on the investor relations section of Aptose's website. A replay of the webcast will be available on the company's website for 30 days.

The press release, the financial statements, and the management's discussion and analysis for the quarter ended March 31, 2023, will be available on SEDAR and EDGAR.

About Aptose Biosciences Inc.

Aptose Biosciences is a clinical-stage biotechnology company committed to developing precision medicines addressing unmet medical needs in oncology, with an initial focus on hematology. The company's small-molecule cancer therapeutics pipeline includes products designed to provide single-agent efficacy and to enhance the efficacy of other anti-cancer therapies and regimens without overlapping toxicities. The company has two clinical-stage oral kinase inhibitors under development for hematologic malignancies: tuspetinib (HM43239), an oral, myeloid kinase inhibitor being studied as monotherapy and in combination therapy in the Aptivate international phase 1/2 expansion trial in patients with relapsed or refractory acute myeloid leukemia (AML); and luxeptinib (CG-806), an oral, dual lymphoid and myeloid kinase inhibitor in phase 1 a/b stage development for the treatment of patients with relapsed or refractory hematologic malignancies.

We seek Safe Harbor.