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LAG-3 IMMUNOTHERAPY I ANNUAL REPORT 2018 Reporting period: Year ended 30 June 2018 Previous corresponding period: Year ended 30 June 2017 ABN 90 009 237 889
CONTENTS CORPORATE DIRECTORY 3 CHAIRMAN S LETTER 4 REVIEW OF OPERATIONS 5 DIRECTOR S REPORT 9 CORPORATE GOVERNANCE STATEMENT 26 AUDITOR S INDEPENDENCE DECLARATION 27 FINANCIAL STATEMENTS 28 CONSOLIDATED STATEMENT OF COMPREHENSIVE
INCOME 29 CONSOLIDATED BALANCE SHEET 30 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 31 CONSOLIDATED STATEMENT OF CASH FLOWS 32 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 33 DIRECTOR S DECLARATION 70 INDEPENDENT AUDITOR S REPORT TO THE
MEMBERS OF IMMUTEP LIMITED 71 SHAREHOLDER INFORMATION 77
DIRECTORY Directors Dr Russell Howard (Non - Executive Chairman) Mr Pete Meyers (Non - Executive Director & Deputy Chairman) Mr Marc Voigt (Executive Director & Chief Executive Officer) Mr Grant Chamberlain (Non - Executive Director) Company
Secretaries Ms Deanne Miller Mr Tom Bloomfield Registered office & principal place of business Level 12 95 Pitt Street Sydney NSW 2000 Share Registry Boardroom Pty Ltd Grosvenor Place Level 12, 225 George Street Sydney, NSW 2000 Auditor
PricewaterhouseCoopers One International Towers Sydney, Watermans Quay Barangaroo, NSW 2000 Banker National Australia Bank Ltd Kew Branch Melbourne, Victoria 3000 Stock exchange listings Immutep Limited shares are listed on the: Australian
Securities Exchange (ASX code: IMM), and NASDAQ (NASDAQ code: IMMP) Website address www.immutep.com
CHAIRMAN S LETTER Dear Shareholders, I am pleased to pres ent Immutep s Annual Report for the 2018 financial
year. This is my first Annual Report as your Chairman and our first Annual Report as Immutep Dr. Russell Howard Limited, after chang-ing the Company s name from Prima BioMed Ltd to Immutep Limited at our Annual General Meeting in November 2017.
It has been an exceptionally busy and successful year for Im-mutep, particularly in terms of clinical development achieve-ments that place us in a leadership position in the LAG-3 immunotherapy field, as well as with corporate achievements that have
solidified the Company s strategy. Immutep is a biotechnology company that is developing novel immunotherapy treatments for cancer and autoimmune diseas-es. We are proud to be the global leader in developing lympho cyte-activation gene 3
(LAG-3) therapeutics, with four LAG-3 based product candidates, one in preclinical development and three in clinical development. LAG-3 continues to be an area of intensifying interest within the pharmaceutical industry. During the financial year,
we were delighted to sign a new collaboration and supply agreement with Merck & Co., Inc., Kenilworth, NJ, USA (known as MSD outside the United States and Canada), to commence a new Phase II clinical trial (called TACTI-002) that will evaluate
the combination of our lead product candidate eftilagimod alpha ( efti or IMP321 ) with MSD s anti-PD-1 therapy KEYTRUDA (pem-brolizumab) in three different clinical settings. Efti is also being evaluated by Immutep as
a combination therapy in our Phase IIb (AIPAC) and Phase I (TACTI-mel) clinical trials. In addition, Efti is being evaluated in an investigator sponsored trial (INSIGHT). The new collaboration with MSD builds on our existing partnerships with
GlaxoSmithKline (GSK), Novartis and EOC Pharma, an oncology focused affiliate of Eddingpharm, for the development of our LAG-3 product candidates. Our clinical trial pipeline has been significantly strengthened during the year. Our partnership with
MSD has added a new Phase II clinical trial to the pipeline. In addition, Novartis has recently doubled the number of trials it is running for LAG525 (derived from Immutep s IMP701 antibody), adding another two Phase II clinical trials to their
development program. Fundamentally, Immutep s success will be driven by the clin ical data that emerges from these trials and we are pleased that we were able to report encouraging clinical results during the financial year. TACTI-mel, our
Phase I clinical trial evaluating efti in combination with KEYTRUDA (pembroli-zumab) in melanoma patients, was expanded on the back of encouraging interim data that was reported in November 2017 and a positive safety review. This data was
further sup ported by more mature interim data in May 2018. In July 2017, Immutep was able to successfully complete its first capital raise using American Depository Shares (ADS) since listing on NASDAQ in 2012, raising approximately US$5
million (approximately A$6.5 million) and bringing several U.S. specialist healthcare institutional investors onto the share register. Immutep also completed a successful placement via its ASX listing in March 2018 that attracted two major
Australian insti-tutional investors, Australian Ethical Investment and Platinum Asset Management to our register. The capital raise was also supported by our former Chairman, Lucy Turnbull, AO and Ridgeback Capital. Alongside this placement, we are
grateful for the strong support we received from existing sharehold ers through our share purchase plan in April 2018. The total proceeds from this financing were A$13.16 million, meaning Immutep is well funded with a cash reach into Q2 of
FY2020 or Q4 of calendar year 2019. There were a number of changes to the Board during the financial year. At our AGM in November 2017 we farewelled our long-serving Chair Lucy Turnbull and Vice-Chairman Albert Wong. I took over as Chairman and Pete
Meyers took over as Deputy Chairman at that time and Grant Chamber lain was appointed Non-Executive Director in August 2017. On behalf of the Board, I would like to thank all our share-holders for their continued support of Immutep. The strong
operational and business development progress that has been made during the financial year has positioned the Company well for further success in FY2019, as we prepare to report the first Progression Free Survival (PFS) data from AIPAC in calendar
year 2019. I look forward to updating you on further progress in the coming year.
OPERATIONS On behalf of the directors and management of Immutep, it is my pleasure to report on our operations for the 2018 financial year. Operational and Financial Review The financial year was one that marked strong operational and financial
progress for Immutep. The Company continued its operational focus on LAG-3 immunotherapy, pro-gressing the development of its LAG-3 based product candidates. In terms of clinical results, we were very encouraged by the interim data we reported for
our TACTI-mel trial. These results are detailed below. The year was also significant as the Company rebranded and changed its name from Prima BioMed Ltd to Immutep Limited, following shareholder approval at its Annual General Meeting in November
2017. The name change reflects the Company s operational focus on its LAG-3 product candidates, which the Company acquired in late 2014 when it purchased Immutep S.A.S. (formerly named Immutep S.A. and now the Company s 100% owned
subsidiary in France). In July 2017, we successfully completed our first capital raise using American Depository Shares (ADS) since listing on the NASDAQ in 2012, raising approximately US$5 million (approximately A$6.5 million) and bringing several
U.S. specialist healthcare institutional investors onto the share register. In March-April 2018, we also raised a total of $13.16 million to support Immutep s ongoing and planned immuno-oncology clinical development program, its preclinical
program in autoimmune disease and for general working capital purposes. This financing consisted of a placement of 326,192,381 new fully paid ordinary shares in the Company at an issue price of A$0.021 per share, raising A$6.85 million, along with a
share purchase plan for existing shareholders which took place at the same issue price and raised A$6.31 million through the issue of 300,561,089 new ordinary shares. Financial Performance Revenue from ordinary activities increased from nil in
FY2017 to A$2.63 million in FY2018, which is attributed to milestone payments received from the Company s partners. In particular, in August 2017, the company received a US$1 million milestone payment from Novartis relating to the development
of IMP701, and in January 2018, the Company received a US$1 million milestone payment from EOC Pharma relating to the development of IMP321 in China. Miscellaneous income increased by A$208K to A$1.08 million for FY2018 from A$0.8 million for
FY2017. This increase was primarily attributable to sales growth of our LAG-3 products used in research. In March 2018, Immutep received a A$687K cash rebate from the Australian Federal Government s R&D tax incentive pro gram, which was
provided in respect of expenditure incurred on eligible research and development activities conducted in FY2017 and mainly related to our TACTI-mel trial being conducted in Australia. In addition, Immutep has recognised approxi mately A$720K
grant income from the Australian Federal Government s R&D tax incentive program. The Company s French subsidiary has also benefited from cash grants of 877K (approximately A$1.35 million) from the French Credit d Impot Recherche
scheme (received in August 2017) for the eligible research and development expenditures incurred in the 2016 calendar year in Europe. The French subsidiary has also recognised A$2.5 million grant income from the French Credit d Impot Recherche
scheme for the expenditure incurred on eligible research and development activities conducted in FY2018. Interest income increased by A$73K to A$177K in FY2018. The increase was due to the increase in the level of cash held on term deposit and an
increase in interest rates. Research and development and intellectual property expenses increased by A$2.5 million to A$10.0 million in FY2018. The significant increase was expected and was primarily due to the increase in research and development
expenses due to patient recruitment for our two IMP321 related clinical trials, AIPAC and TACTI-mel, and the development of our new product candidate IMP761. Corporate administrative expenses for FY2018 were A$7.2 million compared to A$4.3 million
OPERATIONS continueddThis increase of A$2.9 million was primarily due to an increase of A$0.6 million in salary expense due to increased headcount and an increase in non-cash expenses including A$1.4 million in employee share-based payments and
A$0.5 million in trans-action costs relating to the US capital raising. Whilst the loss after tax for FY2018 of A$12,746,020 was higher compared to A$9,367,206 for FY2017, mainly due to non cash expenses, the operating cash outflows reduced year
on year from $8.5 million in FY2017 to $7.8 million in FY2018. Strategic Development The development of our four product candidates towards marketing approval forms Immutep s core operational focus. Stra-tegically, the Company progresses these
product candidates through preclinical and clinical development either on its own or in collaboration with its large pharmaceutical partners. AIPAC AIPAC is Immutep s Phase IIb clinical trial that is evaluating efti in combination with
paclitaxel in metastatic breast cancer. The primary clinical end-point of the study is Progression-Free Survival (PFS). During the financial year, clinical trial sites were opened across Germany, the UK, France, Hungary, Belgium, Poland and the
Netherlands and are now actively recruiting and treating patients as part of the randomised and controlled phase of the study. The Company was pleased to report that a total of 113 patients had been enrolled in the trial by June 2018, marking the
mid point of patient recruitment and first PFS data remains on track to be reported in calendar year 2019. TACTI-002 TACTI-002 is the Company s announced Phase II clinical trial being conducted in collaboration with MSD. The trial will
eval uate the combination of efti with MSD s KEYTRUDA (pembrolizumab) in patients with two different types of cancers: head and neck squamous cell carcinoma (2nd line) and non-small cell lung carcinoma (1st and 2nd line). Up to 110
patients will be recruited for the trial which will take place in up to 15 study centres across the U.S., Europe and Australia. During the financial year, the clinical team progressed its preparations for the trial, including developing the trial
protocol, selecting clinical sites and submitting an investigational new drug (IND) application for efti with the U.S. Food and Drug Ad-ministration (FDA) in June 2018, following the Company s Pre-Investigational IND meeting with the FDA in
November 2017. In July 2018, Immutep announced the approval of the IND by the FDA. Immutep plans to commence the TACTI-002 study in the last quarter of calendar year 2018, with an expectation of reporting the first data from the trial in mid 2019.
TACTI-mel In November 2017, Immutep was pleased to report encouraging interim data from its TACTI-mel Phase I clinical trial. This study is evaluating the combination of efti with KEYTRUDA (pembrolizumab) in unresectable or metastatic melanoma
pa tients. In February 2018, the Data and Safety Monitoring Board (DSMB) confirmed that the combination of efti with pembroli-zumab was safe and well tolerated at doses up to 30 mg per subcutaneous injection. Encouraged by the interim data and
the positive outcome from the DSMB review, Immutep expanded the TACTI-mel study to include a fourth cohort (Part B) of six patients which will evaluate 30 mg of efti in combination with pembrolizumab starting at cycle one. Dosing for this cohort
commenced in March 2018 and the cohort was fully recruited earlier this month. In May 2018, Immutep reported more mature data from the study, which supported earlier interim data that the combination therapy delivers a durable response in a subset
of patients. Specifically, data from the initial three cohorts of the TACTI-mel trial yielded an Overall Response Rate ( ORR ) of 61% when the response rates from the initial four cycles of pembrolizumab monotherapy are used, and an ORR of
33% measured from the start of combination therapy where IMP321 was added at cycle five of pembrolizumab treatment. Encouragingly, two complete responses according to RECIST have been reported from the trial, out of 18 patients. Immutep expects to
report updated data from TACTI-mel in November 2018. Part B of the study is ongoing and was fully recruited in August 2018. INSIGHT
OPERATIONS continued Investigator Sponsored Trial INSIGHT is a collaborative study being conducted and directed by Immutep s partner, IKF in Frankfurt, Germany. INSIGHT is investigating the potential for efti in different settings in terms of
route of administration and indications. In July 2017, IKF re ceived the necessary approvals to commence the INSIGHT trial and has been recruiting patients. We expect IKF will report interim data from the trial in calendar year 2018. Preclinical
development of IMP761 The preclinical development of our product candidate for autoimmune diseases, IMP761 has also advanced during the finan cial year, completing a preclinical study in cynomolgus monkeys. The Company expects to report data
from the study later in the 2018 calendar year. Clinical development by Immutep s partners Immutep s commercial partners GSK and Novartis continued to progress the development of GSK2831781 (derived from Immutep s IMP731 antibody) and
LAG525 (derived from Immutep s IMP701 antibody), respectively, during the financial year. The Company was pleased to note that Novartis expanded its clinical development program for LAG525 earlier this calendar year, now having three active
clinical trials with LAG525 with a fourth trial expected to commence soon. GSK completed its Phase I study evaluating GSK2831781 in psoriasis in March 2018. In early 2018, Immutep s partner CYTLIMIC commenced its phase I study evaluating
CYTLIMIC s proprietary peptide vaccine (which contains efti as an adjuvant) in hepatocarcinoma. The trial is being conducted at the Yamaguchi University Graduate School of Medicine and is the second trial conducted by CYTLIMIC with its vaccine.
Our Chinese partner EOC Pharma, an oncology focused affiliate of Eddingpharm, commissioned the manufacture of Good Manufacturing Practice (GMP) batches of efti from our manufacturing partner in China, WuXi Biologics in June 2018. The GMP batches are
to be used for EOC Pharma s clinical development program for efti, following the grant of EOC Pharma s Investigational New Drug (IND) application in China in December 2017, which resulted in a US$1 million milestone payment to Immutep. EOC
Pharma is expected to commence a Phase I trial of efti in combination with paclitaxel in metastatic mela noma in September 2018. Preclinical study at Monash University Together with its research partner Monash University in Melbourne, Immutep
was pleased to be awarded an Australian Research Council (ARC) Linkage Project scheme grant of A$360,000 in August 2017. The grant will help fund a research project into the role of LAG-3 in immune responses, which will be conducted by Professor
Jamie Rossjohn of Monash s Biomedicine Discovery Institute in collaboration with Immutep. Intellectual Property portfolio Immutep has a strong and continually expanding patent portfolio across major geographic markets. During the financial
year, the Company continued to strengthen its intellectual property position, adding four new patents to its patent portfolio, name ly a Japanese patent and a European patent relating to efti (IMP321), a Japanese patent for IMP731, and a United
States patent for LAG525 (IMP701). Outlook Over the last year, Immutep has observed increasing investment into the LAG-3 immunotherapy space, with more patients participating in more LAG-3 related clinical trials in 2018. We believe that LAG-3 will
continue to attract investment from pharmacutical and biotechnology companies around the globe and Immutep intends to remain very active in terms of busi ness development. Immutep is expecting to report further data from its TACTI-mel and
INSIGHT trials, as well as potential updates from our pharmaceutical partners during the 2019 financial year and will be preparing to report the first data from the AIPAC trial in calendar year 2019.
OPERATIONS CONTINUED Clinical progress is also expected to continue as we commence our new TACTI-002 trial in Europe, Australia and in the US. Our Chinese partner, EOC Pharma, plans to commence its Phase I clinical trial in the coming months. This
would bring the number of active clinical trials for efti alone to five, a very encouraging investment in this novel immunotherapy. On behalf of the Board and management team of Immutep, we thank you for your continued support and look forward to
the coming twelve months with great optimism. Sincerely, Marc Voigt Executive Director & Chief Executive Officer (CEO) Immutep Limited 21 August 2018
DIRECTOR S REPORT The directors present their report on the consolidated entity (referred to hereafter as the
consolidated entity or group ) consisting of Immutep Limited (referred to hereafter as the Company or parent entity ) and the entities it controlled at the end of, or during, the year ended 30 June 2018.
Directors The following persons were directors of Immutep Limited during the whole of the financial year and up to the date of this report, unless otherwise stated: Dr Russell Howard (Non - Executive Chairman) - Note 1 Mr Pete Meyers (Non-Executive
Director & Deputy Chairman) - Note 2 Mr Marc Voigt (Executive Director & Chief Executive Officer) Mr Grant Chamberlain (Non-Executive Director, appointed 21 August 2017) Ms Lucy Turnbull, AO (Non-Executive Chairman: prior to 17 November
2017) - Note 3 Mr Albert Wong (Non-Executive Deputy Chairman: prior to 17 November 2017) - Note 4 Note 1 - Dr Russell Howard was appointed as Non - Executive Chairman on 17 November 2017 Note 2 - Mr Pete Meyers was appointed as Deputy Chairman on 17
November 2017 Note 3 - Ms Lucy Turnbull, AO resigned as Non-Executive Director and Chairman on 17 November 2017 Note 4 - Mr Albert Wong resigned as Non-Executive Director and Deputy Chairman on 17 November 2017 Principal activities During the
financial year the principal continuing activities of the consolidated entity consisted of research, development and commercialisation of biologicals. Dividends There were no dividends paid or declared during the current or previous financial year.
Review of operations The loss for the consolidated entity after providing for income tax amounted to $12,746,020 (30 June 2017: $9,367,206). Refer to the Review of Operations on page 5 for further detail. Significant changes in the state of affairs
Immutep was able to successfully complete in July 2017 its first capital raise using American Depository Shares (ADS) since listing on NASDAQ in 2012, raising approximately US$5 million (approximately A$6.5 million) and bringing several U.S.
spe cialist healthcare institutional investors onto the share register. In March-April 2018, the company successfully raised a total of $13.16 million to support Immutep s ongoing and planned im-muno-oncology clinical development program,
its preclinical program in autoimmune disease and for general working capital purposes. There were no other significant changes in the state of affairs of the consolidated entity during the financial year. Matters subsequent to the end of the
financial year On 31 July 2018, the company received approval of its Investigational New Drug ( IND ) application by the U.S. Food and Drug Administration ( FDA ) for eftilagimod alpha ( efti or IMP321 ), a
LAG-3Ig fusion protein. On 7 August, the company announced the grant of Canadian patent no. 2,685,584 entitled Cytotoxic anti-LAG-3 monoclonal antibody and its use in the treatment or prevention of organ transplant rejection and autoimmune
disease. On 21 August, the company announced that it had received a 1,221,906 cash rebate from the French Government under its Credit d Impot Recherche scheme (CIR).
DIRECTOR S REPORTCONTINUED Likely developments and expected results of operations Information on likely developments
in the operations of the consolidated entity are included in the Review of Operations on page 5. Information on the expected results of operations have not been included in this report because the directors believe it would be likely to result in
unreasonable prejudice to the consolidated entity. Environmental regulation The consolidated entity is not subject to any significant environmental regulation under Australian Commonwealth or State law. Information on directors Dr Russell Howard
Qualifications Experience and expertise Dr. Russell Howard is an Australian scientist, executive manager and 1 entrepreneur. He was a pioneer in molecular parasitology and ^^^^ commercialization of DNA Shuffling . He is an inventor of 9