Sutro Biopharma Reports Third Quarter 2018 Financial Results - STRO-001 Received Orphan Drug Designation for Treatment of Multiple Myeloma - STRO-002 to Begin Phase 1 Trial for Patients with Ovarian and Endometrial Cance

Sutro Biopharma Reports Third Quarter 2018 Financial Results

- STRO-001 Received Orphan Drug Designation for Treatment of Multiple Myeloma

- STRO-002 to Begin Phase 1 Trial for Patients with Ovarian and Endometrial Cancers in Early 2019

SOUTH SAN FRANCISCO, Calif., Nov. 14, 2018 Sutro Biopharma, Inc. (NASDAQ: STRO), a clinical-stage drug discovery,

development and manufacturing company focused on the application of precise protein engineering and rational design to create next-generation oncology therapeutics, today reported its financial results for the third quarter ended September 30,

This has been an outstanding third quarter for Sutro. We have completed our initial public offering and achieved multiple milestones in the

development of our own clinical programs for treatment of multiple myeloma and ovarian cancer, said Bill Newell, Sutro s Chief Executive Officer. We look forward to working with our newest partners and collaborators as the

Sutro team continues to execute at a high level to advance our vision of transforming the lives of patients.

Business Highlights and Recent

STRO-001 Clinical Program

STRO-002 Clinical Program

Corporate Highlights

Third Quarter 2018 Financial Highlights

Cash, Cash Equivalents and Marketable Securities

of September 30, 2018, Sutro had cash, cash equivalents and marketable securities of $123.0 million.

In October 2018, Sutro announced the

closing of its IPO of 5,667,000 shares of its common stock at a price of $15.00 per share. The gross proceeds to Sutro from the IPO, before deducting underwriting discounts and commissions and offering expenses,

were $85.0 million. In addition to the IPO, Sutro concurrently sold in a private placement to Merck Sharp & Dohme Corp. (Merck) additional shares of common stock at the IPO offering price for gross proceeds of $10.0 million.

Proceeds from the IPO and the concurrent private placement are not reflected in Sutro s September 30, 2018 balance sheet.

Revenue was $7.8 million for the third quarter of 2018, which included collaboration revenue of $6.9 million recognized primarily from

Merck, Celgene and EMD Serono, in addition to other revenue of $0.9 million. During the third quarter of 2018, Sutro began recording revenue from Merck primarily from the $60.0 million upfront payment received by Sutro under the July 2018

collaboration and licensing agreement, for which revenue is being recognized ratably over an approximate four-year period. Future collaboration revenue from Merck, Celgene and EMD Serono, and from any future collaboration partners, will fluctuate as

a result of the timing and amount of upfront, milestones and other collaboration agreement payments.

Total operating expenses for the third quarter of 2018 were $18.0 million, comprised of research and development expenses of $12.6 million and

general and administrative expenses of $5.4 million. Total operating expenses for the quarter included non-cash stock-based compensation expense of $0.3 million and depreciation and amortization

expense of $1.1 million. In future quarters, Sutro expects to incur additional general and administrative expenses as it operates as a public company following its IPO that closed on October 1, 2018.

Net Loss Per Share Calculation

The financial statements

as of September 30, 2018, including share and per share amounts, do not give effect to the IPO, or the conversion of the redeemable convertible preferred stock, as the IPO and such conversions were completed on October 1, 2018. Relatedly,

the weighted-average shares used in calculating net loss per share for the third quarter of 2018 include only common stock outstanding prior to the IPO.

About Sutro Biopharma

Sutro Biopharma, Inc., located in South San Francisco, is a clinical-stage drug discovery, development and manufacturing company. Using precise protein

engineering and rational design, Sutro is advancing next-generation oncology therapeutics.

Sutro s proprietary and integrated cell-free protein

synthesis and site-specific conjugation platform, XpressCF+ , led to the discovery of STRO-001 and STRO-002, Sutro s first two internally-developed

antibody-drug conjugates, or ADCs. STRO-001 is a potentially first-in-class ADC targeting CD74, a protein highly expressed in

multiple myeloma and non-Hodgkin s lymphoma, and is currently in a Phase I study. STRO-002 is a potentially best-in-class

ADC targeting folate receptor alpha, a cell-surface protein highly expressed in gynecological cancers.

Sutro is dedicated to transforming the lives of

cancer patients by creating medicines with improved therapeutic profiles for areas of unmet need.

To date, Sutro s drug discovery efforts have

focused on antibody-drug conjugates, cytokine-based immuno-oncology therapies, and bispecific antibodies primarily directed at clinically-validated targets for which the current standard of care is suboptimal.

Sutro s platform allows it to accelerate discovery and development of potential

first-in-class and best-in-class molecules through rapid and systematic evaluation of

protein structure-activity relationships to create optimized homogeneous product candidates.

In addition to developing its own oncology pipeline, Sutro

is collaborating with select pharmaceutical and biotech companies to discover and develop novel, next-generation therapeutics. As the pace of clinical development accelerates, Sutro and its partners are developing therapeutics designed to more

efficiently kill tumors without harming healthy cells.

Follow Sutro on Twitter, @Sutrobio, and at www.sutrobio.com to learn more about our passion

for changing the future of oncology.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform

Act of 1995, including, but not limited to, anticipated clinical development activities, potential benefits of the company s product candidates and platform and anticipated financial trends. All statements other than statements of historical

fact are statements that could be deemed forward-looking statements. Although the company believes that the

expectations reflected in such forward-looking statements are reasonable, the company cannot guarantee future events, results, actions, levels of activity, performance or achievements, and the

timing and results of biotechnology development and potential regulatory approval is inherently uncertain. Forward-looking statements are subject to risks and uncertainties that may cause the company s actual activities or results to differ

significantly from those expressed in any forward-looking statement, including risks and uncertainties related to the company s ability to advance its product candidates, obtain regulatory approval of and ultimately commercialize its product

candidates, the timing and results of preclinical and clinical trials, the company s ability to fund development activities and achieve development goals, the company s ability to protect intellectual property and other risks and

uncertainties described under the heading Risk Factors in documents the company files from time to time with the Securities and Exchange Commission. These forward-looking statements speak only as of the date of this press release, and

the company undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date hereof.

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Sutro Biopharma, Inc.

Condensed Statements of Operations and Comprehensive Loss

thousands, except share and per share amounts)

Sutro Biopharma, Inc.

Condensed Balance Sheets

(In thousands, except share and per share amounts)