Mr. Frank Gleeson reports

SATELLOS BIOSCIENCE ANNOUNCES 2023 Q1 FINANCIAL RESULTS AND OPERATIONAL HIGHLIGHTS

Satellos Bioscience Inc. has released its financial results and operational highlights for the three months ending March 31, 2023. All references to currency in this press release are in Canadian dollars unless otherwise noted. Satellos's interim condensed consolidated financial statements for the three months ended March 31, 2023, and the related management's discussion and analysis (MD&A) are available on SEDAR.

"This was a significant quarter for the company with the closing of a $55-million equity financing with leading biotech and health sector investors," said Frank Gleeson, president and chief executive officer of Satellos. "We now have the financial resources to advance our lead drug candidate, SAT-3153, a novel small molecule as a potential disease-modifying treatment for Duchenne muscular dystrophy, into clinical study."

Business highlights

Program and operational highlights for the three months ended March 31, 2023, along with recent developments include:

• The company reported results of preclinical studies of SAT-3153 as its lead drug candidate which it conducted in the mdx disease model of Duchenne muscular dystrophy (DMD) showing significant increases in muscle strength and size after two weeks of treatment.
• Completion of a non-brokered private placement offering of 10-per-cent unsecured non-convertible debenture units during the quarter on March 24, 2023, under which Satellos raised gross proceeds of $2,385,000 to be used for general corporate and working capital purposes.
• Closing of an equity offering after the end of the quarter on May 17, 2023, for gross proceeds of $55-million, under which subscribers either purchased common shares at 50 cents per common share or prefinanced common share purchase warrants for 49.999 cents per prefinanced common share purchase warrant. Investors purchased a total of 110 million securities consisting of 70,297,220 common shares and 39,702,780 prefinanced warrants. Bloom Burton Securities Inc., a related party of the company, acted as agent of the transaction. Frank Gleeson, chief executive officer of the company, William Jarosz, a director of the company, William McVicar, a director of the company, Rob Hall, an officer of the company, and Bloom Burton & Co. Inc., a related party of the company, participated in the equity offering.

Financial results

Satellos had cash and cash equivalents of $2,984,400 as of March 31, 2023. Prior to March 31, 2023, as noted herein, Satellos closed a non-convertible debenture offering for gross proceeds of $2,385,000 and, after March 31, 2023, an equity offering for gross proceeds of $55-million. Upon closure of the equity offering the company's financial strength improved. Net proceeds of the equity offering will be used to finance research and development activities, including, but not limited to, advancing its lead program for a small molecule drug for the treatment of Duchenne muscular dystrophy through preclinical work, IND submission, and subsequent phase 1 studies, as well as for general and administrative expenses, working capital purposes, and other corporate purposes. The company will also invest in its platform and pipeline.

The net loss was $1,665,656 with the total comprehensive loss being $1,666,713, each for the three months ended March 31, 2023, compared with $2,115,801 and $2,117,487 for the corresponding three months ended March 31, 2022, respectively. This reduction in loss was primarily due to reduced spending on professional fees, G&A and stock-based compensation.

About muscle stem cells and Duchenne muscular dystrophy

Satellos scientific founder Dr. Michael Rudnicki discovered and has demonstrated how muscle stem cells employ a biological process known as stem cell polarity to regulate muscle repair and regeneration throughout life. Dr. Rudnicki has also shown how regulatory defects in stem cell polarity lead to a failure of muscle repair and regeneration in Duchenne muscular dystrophy (DMD), representing a previously unrecognized root cause of DMD. As a result of this continuing inability to produce sufficient numbers of new muscle cells, people with DMD are unable to repair the continuous and accumulating muscle tissue damage. Based on this research, Satellos is advancing a novel small-molecule therapeutic designed to rescue the defect in stem cell polarity and provide a disease-modifying treatment for DMD and other muscular dystrophies.

About Satellos Bioscience Inc.

Satellos is a publicly traded biotechnology company dedicated to developing life-improving medicines to treat degenerative muscle diseases. Satellos has incorporated breakthrough research in muscle stem cell polarity into a proprietary discovery platform, called MyoReGenX, to identify degenerative muscle diseases where deficits in this process affect muscle regeneration and are amenable to therapeutic intervention. With this platform, Satellos is building a pipeline of novel therapeutics to correct muscle stem cell polarity and promote the body's innate muscle repair and regeneration process. The company's lead program is an oral, small-molecule drug candidate in development as a disease-modifying treatment for Duchenne muscular dystrophy. Satellos is headquartered in Toronto, Ont.

We seek Safe Harbor.