Full Press Release Details
| October 2021 PALI (NASDAQ) | palisadebio.com
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any change in expectations, even as new information becomes available. This presentation discusses product candidates that are under clinical study and which have not yet been approved for marketing by the U.S. Food and Drug Administration. No
representation is made as to the safety or effectiveness of these product candidates. Caution should be exercised when interpreting results from separate trials involving separate product candidates. Differences exist between trial designs and
subject demographics, which limit the conclusions that can be drawn from comparisons across different trials. This presentation includes statistical and other industry and market data that we obtained from industry publications, third-party
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owners thereof and are used for reference purposes only. 2
Palisade Bio - Developing Targeted Inhibitors of Digestive
Proteases Scientific Platform Palisade Bio develops drugs to treat diseases caused by Technology digestive-enzyme leak producing inflammation and tissue damage LB1148 is an oral liquid protease inhibitor administered at home as a bowel prep for
major surgeries, and has demonstrated Phase 3-Ready Lead Drug positive clinical results in two large indications: Candidate 1) accelerating the return of postoperative bowel function, and 2) reducing post-surgical adhesions 3
Lead Drug Candidate LB1148 - Highlights of Potential Path to
Commercialize for Surgery Patients LB1148 can be taken at home prior to hospitalization; ideal Large Commercial Opportunity reimbursement scenario for commercializing a very large surgical market (20% of the market could lead to over $1.5 billion in
revenues) Oral digestive enzyme inhibitor has demonstrated clinical benefit in Clinical Safety & Efficacy multiple surgical studies Prior approvals provide precedent pathway for pivotal trial design Path to Approval and regulatory reviews;
LB1148 progressing to pivotal studies 5
Unmet Need - The Time to Postoperative GI Recovery Postoperative
return of bowel function is often a limiting determinant of hospital discharge Major Surgeries Patients generally do not leave hospital until they have a bowel movement Lack of GI recovery: Gastrointestinal - Causes pain and
bloating - Major discomfort If we save one day on length of stay, we will realize $20M more in profits annually. Abdominal - Extends hospital stay - Mark A. Talamini, MD, MBA - Increases medical costs Chair of Surgery, SUNY
Stony Brook Gynecological LB1148 has demonstrated a 1.1 to 1.3-day reduction in hospital length of stay. Cardiovascular Average hospital expenses per inpatient day = $2,400 6
Unmet Need - Reducing Post-surgical Adhesions Adhesion are a
widespread and potentially severe problem after surgery: Up to 93% of abdominal procedures result in post-surgical adhesions #1 cause of secondary female infertility #1 cause of bowel obstruction (up to 75%) Non-Adhesion
Adhesion th Difference 10 most frequent cause of emergency surgery Complications Complications Length of Stay 5.2 days 7.2 days 38% 80% of emergency surgery deaths Rehospitalization $22,500 $29,800 $7,326/pt. Costs 400,000
adhesiolysis surgeries in US annually $2.3B in medical costs in US annually Sources: J Chir Viscerale. 2012;149(2):114-126. doi:10.1016/j.jviscsurg.2011.11.006 Causes of female infertility, UpToDate 2020 Etter, K., et. Al.. Impact of
postcolectomy adhesion-related complications on healthcare utilization. Clin. Outcomes Res. 10, 761-771 (2018) 7
Only Single Competitor for Each Indication, Yet Competitors Demonstrate
Precedent Pathway for FDA Approval Return of Bowel Function Post-surgical Adhesions Limitations: Limitations: - In-patient hospital administration only - Only product approved for abdominal surgery - Short-term use
only - Only approved for laparotomy - Restrictive REMS program Can not be used for laparoscopic surgeries which comprise a growing percentage of the market Black-box warning: - Only reduces adhesions between the abdominal
wall and the underlying viscera Increased incidence of myocardial infarction - Disrupts surgical process and extends duration of Available only through restricted program - REMS anesthetics 8
Postoperative Complications are Driven by Proteolytic Activity Cascade
of disease mechanisms Injury Protease leak (surgery or Proteolytic activity and translocation hypoperfusion) Tissue damage/permeability Autodigestion Microbiome imbalance/pathology Pathologic cell signaling
activity Inflammatory cell activation/infiltration Receptor degradation Healthy intestine Compromised mucosal barrier Proteolytic intestinal Postoperative permeation complications Delayed recovery Ileus
Adhesions Intestinal injury (from surgery or hypoperfusion during surgery) triggers a Inflammation cascade of disease mechanisms and leads to postoperative complications Destructive feedback loop where protease leakage leads
to additional intestinal damage 9
LB1148 Prevents Intestinal Damage: Rapidly Reseals the Barrier
Hypoperfusion Injury Hypoperfusion Injury 100 75 50 Control - TXA LB1148 25 Continuous epithelial Permeable epithelial 0 barrier barrier Control Sham LB1148 Intact villi structure Loss of villi tissue Oral TXA
Robust basal membrane Basal membrane structure compromised No tissue damage Lymph vessel damage Source: Delano 2013. Rat Shock Model of Hypoperfusion Source: Study#LBS-NC-SMAO-002 Rat SMAO model of intestinal
hypoperfusion (DOF) 10 % Intact Villi
LB1148 Overview: Pipeline in a Product - Multiple Indications
Drug/Class Indication Research Pre-clinical Phase 1 Phase 2 Phase 3 GI Surgery Postoperative return of bowel LB1148* Neonatal cardiac function Oral broad-spectrum surgery protease inhibitor* Prevention of post-surgical abdominal adhesions
*Commercial rights to LB1148 in Greater China (excluding Taiwan) have been out-licensed to Newsoara 11
Restoring Bowel Function 12
GI Surgery Phase 2: Significantly Accelerated Return of GI Function th
Median 75 Percentile P=0.0008 Hazard ratio=1.8 1.5 day improvement 1.1 day improvement 13 LBS-POI-201 CSR
LB1148 Accelerates Return of GI Function - Phase 3 Ready
Consistent statistically significant clinical efficacy in 3 completed clinical studies - 28% improvement in time to return of bowel function after GI surgery in phase 2 (p<0.001) - 48% improvement in time to return of bowel function
after GI surgery in phase 1 (vs. placebo in Entereg study 314*) 1.3-day reduction in hospital LOS vs. expected LOS at time of admission (p<0.03) nd Zero post-surgical abdominal adhesions documented in 2 look surgeries - 30%
improvement in time to return of bowel function after cardiovascular (CV) surgery (p<0.001) 1.0-day reduction in ICU length of stay (LOS) (ns) 1.1-day reduction in hospital LOS (ns) Fast Track designation granted for
pediatric cardiac surgery program Strong IP portfolio, including issued patents on LB1148 drug product 6.9 million addressable patients in the US 14 Source: Entereg Prescribing Information
Preventing Post-surgical Adhesions 15
GI Surgery Study Results: Zero Adhesions in Three Surgery Patients nd
3 of 11 patients required a 2 surgery unrelated to adhesions - Opportunity to visualize and measure adhesions nd For the three patients with a 2 surgery: extent - No adhesions severity - No evidence
of inflammation Principal investigator's report: As a surgeon who has performed thousands of abdominal surgeries, the absence of adhesions in three follow-up surgery patients is entirely unexpected 16
LB1148 Commercial Opportunity 17
Illustrative Patient Journey: GI Surgery with LB1148 Administration
Drug is taken at home: Reimbursed by patient's Bowel prep pharmacy benefit (no Anti-nausea Antibiotics cost to hospital) Pharmacy LB1148 Physician's Office Doesn't disrupt the
Prescription filled 2 Pre-op physical in clinic; 1 at pharmacy Physician writes prescription surgeon's practice Likely covered by pharmacy benefit In-patient surgery 4 3 Preoperative medications taken at home 5 Recovery at home 18 LB1148
LB1148 Has Large Global Market Opportunity US Market Partnered 1.1
million open heart surgeries China: w/ Newsoara 5.7 million abdominal surgeries EU and ROW Opportunities 20-40% market penetration could translate to Potential to partner with US rights or >$2B revenue independently M&A - Shows Value of
Adhesion Market USA Strategy Commercialize by marketing to 5,000 Baxter acquired the medical device hospitals Seprafilm from Sanofi for $350M in 2020 3.5X sales 19
5800 Armada Dr, Suite 210 Carlsbad, CA 92008 858-704-4900
IR@palisadebio.com PALI (Nasdaq) www.palisadebio.com 20
LB1148 - Expeditious Regulatory Pathway; Limited Competition
Novel oral formulation comprised of FDA-approved components - Broad-spectrum serine protease inhibitor (tranexamic acid) - Known safety profile - Plan to utilize 505(b)(2) pathway for approval Fast-track designation for
- Reducing surgical adhesions - Reducing postoperative GI dysfunction for pediatric patients undergoing open heart surgery Issued patents on drug product No new approved drug for postoperative ileus since 2008 -
Entereg has austere black box warning, onerous REMS protocols, and limited utilization 22
Entereg: Only Drug Approved for Accelerating Return of GI Function
Provides a precedent pathway to FDA approval Developed by GSK/Adolor/Cubist and now owned by Merck Indicated to improve post-op recovery of bowel function - Phase 3 demonstrated*: 17-hour improvement in return
of bowel function 7-hour improvement in hospital length of stay Black-box warning: Entereg MOA carries safety risks - LB1148 has completely different MOA Increased incidence of myocardial infarction Limitations
include*: Available only through restricted program - REMS - In-patient hospital administration only - Short-term use only Entereg's FDA approval provides regulatory - Restrictive REMS program - Black Box
warning for severe side effects roadmap LB1148 clinical trial design Utilized in few hospitals 23 * Entereg Prescribing Information
LB1148 Program Overview Pipeline in a Product - Multiple
Indications Accelerate Return of Reduce Post-surgical Postoperative GI Function Adhesions Abdominal Surgery Cardiovascular Gastrointestinal Surgery Surgery 24
Cardiovascular Surgery (Hypoperfusion Injury) 25
CV Surgery Completed Phase 2: Study Design Screening Period CV Surgery
Postoperative / Discharge Follow-up Day -42 to -1 Day 0* Day 1-14 Day 30 LB1148 Placebo Cardiovascular Surgery Scope & Timelines Study Design Primary Endpoint: Secondary Endpoints: 120 patients undergoing Open-heart CV surgery
Time to return of bowel function ICU length of stay elective cardiac surgery requiring cardio-pulmonary (defined by first bowel Hospital length of stay bypass movement) Single center Organ function
Randomized, double-blind, CRO: IQVIA Inflammatory response placebo-controlled, in subjects Data announced in 2020 Glucose control undergoing CABG and/or heart valve replacement surgery Randomized 1:1
7.5 grams QD on Days 0, 1, and 2 26 * Study Day 0 is the day of surgery.
CV Surgery Phase 2: Significant Improvement in Bowel Function Top-line
data highlights 30% improvement in return of bowel function - Highly statistically significant; p<0.001 - Median time to bowel recovery: 31.7 hours on LB1148 vs. 45.0 hours on placebo - Same endpoint will be used for
Phase 3 1.0-day reduction in ICU LOS (ns) 1.1-day reduction in hospital LOS (ns) No LB1148-related adverse events LB1148 Placebo n=58 n=52 27
GI Surgery: Return of Bowel Function (Physical Injury) 28
Completed GI Surgery Study: 1 Study, 2 Indications, 2 Data Readouts:
Return of Bowel Function and Adhesion Prevention Screening Period GI Surgery Postoperative / Discharge Follow-up Adhesion Assessment Day -42 to -1 Day 0 Day 1-14 Day 30 Second Surgery LB1148 Study drug given as a split dose GI Surgery 2-6 hours
prior to surgery 6-12 hours prior to surgery Scope & Timelines Study Design Functional Indications Adhesion Indications nd 11 subjects Open label, investigator- Return of bowel function At time of 2 surgery: sponsored,
single-arm study of Single site in Los Angeles, CA Hospital length of stay Adhesions extent LB1148 in subjects undergoing Bowel obstruction Adhesions severity elective GI surgery Hospital re-admittance
Patients take 700 mL of LB1148 as a split dose prior to surgery 29
GI Surgery Study Results: 48% Faster than Historical Control GI Surgery
2.3-days earlier first bowel movement 48% better than historical control Data highlights: 48% improvement in return of bowel function - Approvable endpoint No LB1148-related AEs Placebo (Entereg Study 314) Source: Ludwig K, et.
al.. Arch Surg. 2008 Nov;143(11):1098-105. doi: 10.1001/archsurg.143.11.1098. PMID: 19015469. 30