Ms. Cynthia Pussinen reports

SERNOVA RECEIVES ORPHAN DRUG AND RARE PEDIATRIC DISEASE DESIGNATIONS FOR ITS HEMOPHILIA A PROGRAM FROM FDA

The U.S. Food and Drug Administration (FDA) has granted both orphan drug designation (ODD) and rare pediatric disease designation (RPDD) for the company's hemophilia A program.

The FDA grants orphan designation, also referred to as orphan status, to therapies intended for the treatment of rare diseases that affect fewer than 200,000 people in the United States. This designation provides certain benefits, including tax credits for qualified clinical testing, waiver or partial payment of FDA application fees and seven years of market exclusivity, if approved. Separately, rare pediatric disease designations are granted for rare diseases that primarily affect children under 18 years old with recipients of this designation being awarded a priority review voucher, upon approval. The priority review voucher may be redeemed, transferred or sold.

"We are pleased with the FDA's decision to grant these designations for our novel treatment for hemophilia A, which uses the Cell Pouch in combination with cells corrected for the production of Factor VIII," commented Cynthia Pussinen, chief executive officer of Sernova. "Hemophilia A is a serious, life-limiting condition and we are committed to advancing development of the program, with a hope to positively impact patients around the world who are waiting for improved treatments."

About Sernova's hemophilia A Cell Pouch system program

Sernova's hemophilia A program combines the Sernova Cell Pouch with a patient's own cells and will not require the use of immunosuppression medications. This therapy is intended to replace Factor VIII (FVIII) -- an essential blood-clotting protein that is deficient or absent in patients with hemophilia A; this is accomplished by correcting the patient's own blood outgrowth endothelial cells (BOECs) and subsequently returning them to the patient through the Cell Pouch. These modified cells function to release FVIII into the bloodstream, restoring the patient's ability for clotting during periods of bleeding.

Sernova and research partners, through a Horizon 2020 grant, which is part of the European Union's research and innovation funding program in proof-of-concept work, successfully corrected human blood cells from patients with hemophilia A to produce Factor VIII using a novel first-in-class gene and cell therapy approach where the corrected cells were transplanted into the preimplanted, vascularized Cell Pouch in a preclinical model of hemophilia A. The work demonstrated an improvement in blood clotting using the combined technologies (Efficient and safe correction of hemophilia A by lentiviral vector-transduced BOECs in an implantable device; Molecular Therapy: Methods & Clinical Development Vol. 23; December, 2021).

Collaboration with the University of Piemonte Orientale

The company has arranged a collaboration with the University of Piemonte Orientale, Italy, under the direction of Dr. Antonia Follenzi, MD, PhD, professor of histology and cell and gene therapy. Dr. Follenzi is a pioneer of cell and gene therapy approaches to cure hemophilia A. Her laboratory has expertise in the generation of BOECs from hemophilic patients and correcting the FVIII gene using lentiviral vectors.

The purpose of the new collaboration is to optimize the technology using lentiviral vectors to drive the expression of FVIII transgene under the control of novel promoters into BOECs of hemophilia patients to achieve optimal sustained production of FVIII using an optimized cell dose within the Cell Pouch in an animal model of hemophilia A. The overall goal of the collaboration is to develop a product combination along with preclinical results that support advancing into clinical trials in patients with hemophilia A.

Prof. Follenzi stated: "I am pleased to be working with the Sernova team on these advanced technologies for a new and safe treatment of patients with hemophilia A using a gene and cell therapy approach within the Cell Pouch. Our goal is to advance these new technologies to further maximize the release of FVIII into the bloodstream and to extend the duration of that release for a sufficient duration of time to eliminate the need for weekly infusions of FVIII and to significantly improve the lives of people with hemophilia A."

Benefits of ODD and RPDD

Combined benefits of these designations include exclusive marketing rights for a seven-year period, after marketing approval, a 25-per-cent federal tax credit for clinical research expenses incurred in the United States, which is applicable for up to 20 years, waiver of Prescription Drug User Fee Act (PDUFA) fees for orphan drugs (currently worth greater than $3-million (U.S.)), ability to qualify to compete for research grants from the Office of Orphan Products Development (OOPD) to support clinical studies for the orphan indication and eligibility to receive regulatory assistance and guidance from FDA to design the development plan.

Furthermore, once the therapy is approved for marketing, it cannot be copied and sold in the United States for seven years regardless of patent life and the sponsor will be granted a priority voucher, which can be used to receive approximately four months reduction time of the standard FDA review period or sold.

About hemophilia A

Hemophilia encompasses a group of inherited disorders that alter blood coagulation. Classical hemophilia, also known as hemophilia A, is a hereditary hemorrhagic disorder resulting from a congenital deficit of FVIII that manifests as protracted and excessive bleeding either spontaneously or secondary to trauma. Hemophilia A is the most common form of hemophilia and is a genetic disorder caused by missing or defective FVIII, a blood-clotting protein. Severe hemophilia A occurs in about 60 per cent of cases, where the deficiency of FVIII is less than 1 per cent of normal blood concentration. While it is passed down from parents to children, about one-third of cases are caused by a spontaneous change in the gene.

According to the U.S. Centers for Disease Control and Prevention, hemophilia A occurs in about one in 5,000 births. Prolonged bleeding, in areas such as the brain, of a person with hemophilia A, can be fatal. Prolonged bleeding in joints can cause inflammatory responses and permanent joint damage. Approximately 20,000 people in the United States, 2,500 in Canada and 10,000 in Europe have moderate to severe forms of hemophilia A. Though there is no cure for the disease, hemophilia A can be controlled with regular infusions of recombinant clotting FVIII. Treatment costs per patient are as high as $200,000 (U.S.) or more each year, with an aggregate therapeutic cost of over $10-billion (U.S.) per year.

About Sernova Corp.

Sernova is a clinical-stage biotechnology company that is developing therapeutic cell technologies for chronic diseases, including insulin-dependent diabetes, thyroid disease and blood disorders (including hemophilia A). Sernova is currently focused on developing a functional cure for insulin-dependent diabetes with its lead asset, the Cell Pouch system, a novel implantable and scalable medical device with immune-protected therapeutic cells. On implantation, the Cell Pouch forms a natural vascularized tissue environment in the body for long-term survival and function of therapeutic cells that release essential factors that are absent or deficient in the bodies of patients with certain chronic diseases. Sernova's Cell Pouch system has demonstrated its potential to be a functional cure for people with Type 1 diabetes in a continuing phase 1/2 clinical study at the University of Chicago. Sernova is also advancing a proprietary technology in collaboration with the University of Miami to shield therapeutic cells from immune system attack with the goal to eliminate the need for chronic, systemic immunosuppression. In May, 2022, Sernova and Evotec entered into a global strategic partnership to develop an implantable off-the-shelf iPSC-based (induced pluripotent stem cells) islet replacement therapy. This partnership provides Sernova a potentially unlimited supply of insulin-producing cells to treat millions of patients with insulin-dependent diabetes (Type 1 and Type 2). Sernova continues to progress two additional development programs that utilize its Cell Pouch system: a cell therapy for hypothyroid disease resulting from thyroid gland removal and an ex vivo lentiviral Factor VIII gene therapy for hemophilia A.

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