Aerovate Therapeutics Announces First Quarter 2022 Financial Results

Therapeutics Announces First Quarter 2022 Financial Results

Mass. - May 16, 2022 - Aerovate Therapeutics, Inc. (Nasdaq: AVTE), a clinical stage biopharmaceutical company focused

on developing drugs that meaningfully improve the lives of patients with rare cardiopulmonary disease, today announced financial results

for the quarter ended March 31, 2022, and recent business highlights.

on IMPAHCT Global Phase 2b/Phase 3 Clinical Trial. IMPAHCT (Inhaled iMatinib Pulmonary Arterial Hypertension Clinical

Trial) is a Phase 2b/Phase 3 trial of AV-101, our dry powder inhaled formulation of the anti-proliferative drug imatinib for the treatment

of pulmonary arterial hypertension (PAH), a devastating disease impacting approximately 70,000 people in the United States and Europe.

With IMPAHCT now active at multiple sites, investigators and key opinion leaders continue to express enthusiasm for our Phase

2b/Phase 3 trial. However, we are experiencing site initiation delays as a result of clinical trial site staff shortages

and COVID-related short-term interruptions. Because of these delays, we expect to report topline data from the Phase 2b portion of

the trial in the fourth quarter of 2023 or first quarter of 2024. We have obtained orphan drug designation from the U.S. Food and Drug

Administration (FDA) and the European Medicines Agency (EMA) for AV-101 for the treatment of PAH in the United States and the European

Intellectual Property Portfolio. We continued expanding our intellectual property portfolio with the issuance of Patent 11,298,355

and two additional allowances from the United States Patent and Trademark Office.

Management Team Strengthened.

We hired Marco Verwijs as SVP, CMC and Susan Fischer as SVP, Development Operations. Mr. Verwijs has over 15 years of product

development and manufacturing experience. He has worked on multiple commercial products, leading them from clinical product development

to New Drug Application filing and commercial launch. Ms. Fischer has over 20 years of clinical operations experience in both academic

and pharmaceutical industry settings. She previously led clinical operation teams at Syndax Pharmaceuticals Inc., Acetylon Pharmaceuticals,

Inc. and EMD Serono, Inc. that included global clinical trial sites.

Quarter 2022 Financial Results

guidance: We expect that our cash, cash equivalents and short-term investments will be sufficient to fund our operations into the

second half of 2025, based on our current operating plan.

cash equivalents and short-term investments totaled $161.1 million as of March 31, 2022, compared to $167.4 million as of December 31,

2021. The decrease was primarily driven by operational costs for the three-month period ended March 31, 2022.

expenses: Research and development (R&D) expenses for the first quarter ended March 31, 2022 were $7.3 million as compared to

$2.2 million for the first quarter ended March 31, 2021. The increase in R&D expenses was due primarily to clinical trial costs,

manufacturing costs, lower preclinical costs, and increased headcount-related costs in 2022 as compared to 2021.

expenses: General and administrative (G&A) expenses for the first quarter ended March 31, 2022 were $3.8 million as compared

to $0.6 million for the first quarter ended March 31, 2021. The increase in G&A expenses was due primarily to increased payroll costs,

insurance costs, legal fees, stock-based compensation, accounting fees and consulting expenses in 2022 as compared to 2021.

loss: Net loss for the first quarter ended March 31, 2022 was $10.9 million as compared to $2.8 million for the first quarter ended

March 31, 2021. Net loss included stock-based compensation expense of $1.0 million and $23,000 for the first quarter ended March 31,

2022 and March 31, 2021, respectively.

is an investigational, proprietary dry powder inhaled formulation of the anti-proliferative drug imatinib. Developed specifically for

pulmonary arterial hypertension (PAH), AV-101 is designed for delivery by an easy-to-use dry powder inhaler, directly into the lungs

to maximize potential clinical benefit and limit systemic adverse effects. Aerovate is enrolling patients in the IMPAHCT Phase 2b/Phase

3 clinical trial to evaluate the safety and efficacy of different doses of AV-101 in adults with PAH.

(Inhaled iMatinib Pulmonary Arterial Hypertension Clinical Trial) is a multi-national, placebo-controlled Phase 2b/Phase 3 trial in adults

with PAH that will continuously enroll patients as the study progresses from Phase 2b to Phase 3. The Phase 2b portion of the trial will

evaluate three doses of AV-101 compared to placebo to identify an optimal dose based on the primary endpoint, change in pulmonary vascular

resistance (PVR) over 24 weeks versus placebo, and safety, tolerability, and other clinical measures. The Phase 3 portion of the trial

will compare patients taking the optimal dose selected in Phase 2b of AV-101 with placebo. The primary endpoint of the Phase 3 portion

of the trial will be change in six-minute walk distance (6MWD) over 24 weeks versus placebo. More information about this trial is available

at https://clinicaltrials.gov/ct2/show/NCT05036135.

Aerovate Therapeutics, Inc.

is a clinical-stage biopharmaceutical company focused on developing drugs that meaningfully improve the lives of patients with rare cardiopulmonary

disease. Aerovate's initial focus is on advancing AV-101, its proprietary dry powder inhaled formulation of the drug imatinib for

the treatment of patients with PAH. Learn more at aerovatetx.com or follow the company on Twitter and LinkedIn.

announces material information to the public about the Company, its products and services, and other matters through a variety of means,

including filings with the U.S. Securities and Exchange Commission (SEC), press releases, public conference calls, webcasts, the investor

relations section of the Company website at ir.aerovatetx.com, and the Company's Twitter account @AerovateTx in order to achieve

broad, non-exclusionary distribution of information to the public and for complying with its disclosure obligations under Regulation

Note Regarding Forward-Looking Statements

press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended.

Forward-looking statements can be identified by words such as "anticipate," "believe," "continue,"

"could," "estimate," "expect," "future," "goal," "intend," "look

forward to," "may," "plan," "potential," "predict," "project," "potential,"

seek," "strategy," "should," "target," "will," "would" and similar

expressions regarding future periods. These forward-looking statements include, but are not limited to, statements regarding the therapeutic

potential and clinical benefits of AV-101; our expectations regarding clinical site activation and patient enrollment for our Phase 2b/Phase

3 trial; investigators and key opinion leaders' continued enthusiasm for our Phase 2b/Phase 3 trial; our anticipated timing for

the completion of enrollment and release of topline data from the Phase 2b portion of our clinical trial; our belief that we will have

capital to fund Aerovate into the second half of 2025; our business plans and objectives for AV-101, including expectations regarding

timing and success of our Phase 2b/Phase 3 clinical trial, potential regulatory submissions and approvals for AV-101; and our growth

and goals as a company.

forward-looking statements in this press release are based on management's current expectations and beliefs and are subject to

a number of risks, uncertainties and important factors that may cause actual events or results to differ materially from those expressed

or implied by any forward-looking statements contained in this press release, including, without limitation, those risks and uncertainties

related to the therapeutic potential of AV-101; the timing associated with the identification and activation of clinical sites, patient

enrollment, initiation, delivery of drug supply and continuation of our Phase 2b/Phase 3 trial of AV-101 in PAH patients; the impact

of the COVID-19 pandemic on our business, clinical trials, operations and goals; positive results from a clinical study may not necessarily

be predictive of the results of future or ongoing clinical studies; regulatory developments in the United States and foreign countries;

as well as those risks and uncertainties set forth more fully under the caption "Risk Factors" in our most recent Annual

Report on Form 10-K filed with the SEC and subsequent filings with the SEC. We caution you not to place undue reliance on any forward-looking

statements, which speak only as of the date they are made. We disclaim any obligation to publicly update or revise any such statements

to reflect any change in expectations or in events, conditions or circumstances on which any such statements may be based, or that may

affect the likelihood that actual results will differ from those set forth in the forward-looking statements. Any forward-looking statements

contained in this press release represent our views only as of the date hereof and should not be relied upon as representing its views

as of any subsequent date.

Consolidated Balance Sheets

Consolidated Statements of Operations and Comprehensive Loss

thousands, except share and per share amounts)