Mr. Pierre Laurin reports

CHITOGENX REPORTS 2024 FISCAL YEAR-END RESULTS

Chitogenx Inc. has released its financial results and highlights for the fourth quarter and fiscal year 2024 ended on Jan. 31, 2024.

"Regenerative medicine, one of the fastest expanding and most exciting field in modern medicine, is faced with limitations, namely the absence of a solution allowing for administered substances to remain on the site of delivery long enough to have its desired and designed effects. This is where Chitogenx's solution comes into play. Our chitosan-based biopolymer is a safe and reliable delivery mechanism to aid in repairing tissues and organs. Its unique properties offer the unique benefit of significantly increasing the in situ residency time of cells, pharmaceutical or biologic implants so that they may deliver their regenerative effects," said Pierre Laurin, president and chief executive officer. "After having successfully generated proof-of-concept data, we can now focus on activities that will lead to faster commercial status. As such, we are evaluating opportunities for fast-track regulatory programs with potential 510(k) premarket submissions in the U.S. and commercial readiness in other jurisdictions."

Commenting on the fourth quarter and fiscal 2024 results, Luc Mainville, Chitogenx's senior vice-president and chief financial officer, said: "The company has taken diverse steps in 2024 to significantly reduce its cash burn and preserve its financial resources. Operating losses have decreased by 79 per cent and 75 per cent in Q4 2024 and fiscal 2024, respectively. We have also significantly improved our balance sheet with a $3.8-million improvement in our working capital and reducing our liabilities by $3.9-million. We have also taken pro-active recurrent measures to cut down our operating cash burn rate by 68 per cent. With these measures now implemented, we are actively pursuing strategic initiatives and R&D [research and development] partnering arrangements so that we can secure non-dilutive financing to advance our numerous value creation initiatives."

Fourth quarter and fiscal 2024 Ortho-R program highlights:

• In November, 2023, the company announced that Ortho-R, its proprietary chitosan/PRP (platelet-rich plasma)-based biopolymer matrix, successfully demonstrated protection from joint degeneration postmeniscal repair surgery in a large animal study. These results demonstrated protection from knee joint degeneration and osteoarthritis development postmeniscal repair surgery and provide further evidence that the company's proprietary chitosan-based biopolymer, combined with PRP, can potentially bring significant benefit to human tissue repair.
• In September, 2023, the company concluded subjects' enrolment at 20 in its United States rotator cuff tear repair phase I/II clinical trial. All study activities will be completed by June, 2024, as per clinical trial protocol following completion of the clinical follow-up and safety analysis for the 20 recruited subjects.
• In February, 2023, the company obtained, in partnership with Polytechnique Montreal, a $3,472,000 grant (gross) from The Natural Sciences and Engineering Research Council of Canada (NSERC) and Prima Quebec. The four-year grant will be used to advance the scientific development, expand the scope of indications, develop new biomaterials for regenerative medicine and accelerate the commercial readiness of the company's Ortho-R technology platform.
• In February, 2023, the company successfully confirmed soft-tissue residency properties of its chitosan/PRP-based biopolymer matrix, Ortho-R, in a grant supported large animal meniscus tear repair study.

Fourth quarter 2024 corporate highlights:

• In December, 2023, the company agreed with certain investors to convert $30,000 of accrued interests into their principal totalling $300,000 and to amend certain terms (the amended notes). The amended notes bear interest at 12 per cent with a maturity date of Feb. 1, 2025.
• In November, 2023, the company agreed with investors to convert $300,000 of accrued interests to the principal amount of its $3-million convertible debenture maturing Feb. 1, 2025, with the same conditions.
• In November, 2023, the company granted an aggregate of 3,316,667 DSUs (deferred stock units) and 500,000 options to directors and officers of the company, in lieu of cash compensation.
• On Nov. 7, 2023, Chitogenx announced that it had launched a new development program targeting significant unmet medical needs in the burn and skin repair market, currently valued at $19-billion (U.S.) and growing at 5-per-cent-plus CAGR (compound annual growth rate) through 2032. Proof-of-concept studies have already been successfully completed and results will be the subject of news releases in the coming weeks. New patents issued both in the U.S. and Canada support Chitogenx's proprietary chitosan-based biopolymer as ideal combination with cellular regeneration technologies. Both burn and skin repair programs have the potential for streamlined regulatory process, and faster path to commercialization. Development work will be primarily financed by the recently awarded $3.4-million grant.

Fourth quarter 2024 subsequent events:

• In March, 2024, the company received a $56,000 payment as a partial grant payment under the PRP project. A residual $19,000 payment is expected to be received during Q3 2025.
• In March, 2024, the company secured a $75,000 unsecured note from a shareholder, bearing interest at 15 per cent per annum and repayable on March 6, 2026.
• In February, 2024, the company announced that Philippe Deschamps decided to resign from his chief executive officer and board of directors position, with Mr. Laurin, who served as chairman of the board of directors, now acting as CEO.

Fourth quarter and fiscal 2024 financial statements and MD&A (management's discussion and analysis)

Chitogenx's financial statements, and management's discussion and analysis for the three- and 12-month period ended Jan. 31, 2024, are available on SEDAR+.

About Chitogenx Inc.

Chitogenx is a clinical-stage regenerative medicine company dedicated to the development of novel therapeutic tissue repair technologies to improve tissue healing. The company is committed to the clinical development of its proprietary chitosan-based biopolymer technology platform, a proprietary muco-adhesive scaffold, specifically designed to be combined with therapeutics to improve tissue repair.

Other formulations are being developed to leverage the technology's performance characteristics, such as tissue adhesion, pliability and ability to deliver biologics or therapeutics to various tissues damaged by trauma or disease.

We seek Safe Harbor.