Summary

• The board of directors of Cantargia has today resolved on the Rights Issue of approximately SEK 170 million. The board of director’s resolution on the Rights Issue is subject to approval by an extraordinary general meeting, which is intended to be held on 2 December 2024. A notice to the meeting will be published through a separate press release.

• The purpose of the Rights Issue is to, based on feedback from potential stakeholders, secure financing for key activities such as the development and validation of analytical method for IL1RAP in biopsies, intensified preparations for the start of phase 2 development for CAN10 and other research, development and general operations to fund the Company until the middle of 2026.

• The subscription price in the Rights Issue is SEK 1.85 per share. Subscription for new shares shall be made during the period 6 December 2024 – 20 December 2024. The record date for the right to participate in the Rights issue shall be 4 December 2024.

• The Rights Issue is covered to approximately SEK 120 million, corresponding to approximately 70 percent of the Rights Issue, through a combination of subscription undertakings, intentions to subscribe and guarantee commitments.

• The Company intends to hold a webcast on 7 November 2024 at 10:00 pm CET, for details see below.

“Over the past year, Cantargia has presented strong results in both of the clinical projects currently being conducted. The projects are generating interest from external stakeholders and we are continuously receiving valuable feedback. With this financing, we are in a position of strength and we can continue to deliver value-adding results and gradually reduce the risk in the projects in order to be able to conduct further dialogues effectively”, said Göran Forsberg, CEO of Cantargia.

Background and reasons
Cantargia is a Swedish biotech company developing targeted antibody-based pharmaceuticals in clinical phase for treatment of autoimmune & inflammatory diseases and cancer. Cantargia’s research and operations are focused on the IL1RAP molecule, which plays an important role in the development of cancer and autoimmune and inflammatory diseases.

In the oncology project, nadunolimab, over 300 cancer patients have been treated with very promising results and CAN10 is more than halfway into phase 1 in clinical studies, showing good safety and promising effects on biomarkers.

• Cantargia’s projects have great potential in highly competitive areas. In order to conduct cost-effective development and gradually reduce the development risk, it is possible to focus development on the patient groups that have the best chance of responding to treatment, which may be synonymous with elevated levels of the target IL1RAP.
• Significant progress has been made in the development of a diagnostic method which measures the expression of IL1RAP, the target of both nadunolimab and CAN10, in biopsies from patients with, among other things, pancreatic cancer. These advances combined with the clear positive difference in treatment outcomes of patients with high expression of IL1RAP means that the next development step in pancreatic cancer is planned to be a phase 2 or 3 study in patients with high IL1RAP expression. After further development and validation of the analysis method, it is estimated that a study could be started during the second half of 2025. As a result, the assessment is that the project progresses more cost-effectively and with a lower development risk than with studies in non-selected patients. The method can also be adapted for use in other disease areas.
• Future development steps in triple-negative breast cancer will be guided by the results achieved in the ongoing TRIFOUR study, which is financed with existing available funds.
• Very promising results have been documented in non-small cell lung cancer and future development will focus on subgroups by continued refinement in positioning, for example through implementing a biomarker strategy to identify patients who respond best to treatment.

For the CAN10 project, the strategy is to initiate phase 2 development as soon as possible. In parallel with the completion of the clinical phase 1 study, which is financed with current cash balances, the preparations are planned, the most important of which are:

• The project is already supported by solid pre-clinical material, but the documentation is strengthened with further toxicity studies to enable treatment on patients for a longer period of time as well as translational studies on patient tissue, within e.g. HS and systemic sclerosis, with the aim of guiding study design around, among other things, selection of patients and dosage. The possibility to select patients based on skin biopsies using the aforementioned diagnostic method of IL1RAP expression creates an interesting bridge between CAN10’s development and the upgraded strategy for nadunolimab.
• Within CMC, the project is well prepared in that trial substance for start of phase 2 has already been produced. Further development and production will be needed to be able to complete the phase 2 program as well as documentation before the start of registration-based studies.
• Regulatory preparations for and submission of the application for an IND in the USA and clinical trial authorization in Europe.

The Company mainly intends to use the net proceeds from the Rights Issue of approximately SEK 170 million, upon full subscription, to pursue the nadunolimab oncology project, the CAN10 project and to fund general operations, as described above, so that the Company is financed until the middle of 2026. If the Rights Issue is only subscribed in accordance with subscription commitments, intentions to subscribe and guarantee commitments of approximately SEK 120 million, the Company will be financed into 2026.

With existing available funds and the proceeds from the Rights Issue, the Company is thus financed to be able to achieve and report on the following important and potentially value-enhancing milestones:

CAN10

• Results regarding safety, biomarkers and clinical effect from the second part of the phase 1 study where subjects with psoriasis are treated with two different doses (first half of 2025).
• IND for CAN10 in the first half of 2025.

Nadunolimab

• Initial results regarding safety and response (first half of 2025) and safety and long-term efficacy data (second half of 2025) for the randomized phase 2 study with nadunolimab in triple-negative breast cancer (TRIFOUR).
• Initiation of an externally funded study with nadunolimab in leukemia (end of 2024).
• Biomarker strategies for future studies within e.g. pancreatic cancer and lung cancer (first half of 2025).

Presentations and publications

• Publication of CANFOUR, CIRIFOUR and CAN10 results (2024/2025).
• Continuous presentations of new research results at key scientific conferences 2024/25.

The Rights Issue
For the reasons set out above, the Company’s board of directors has decided to carry out the Rights Issue of approximately SEK 170 million before transaction costs, subject to approval by an extraordinary general meeting. The Company’s share capital will thereby be increased by a maximum of SEK 7,347,467.36 through the issue of a maximum of 91,843,342 new shares. The subscription price amounts to SEK 1.85 per share. The right to subscribe for new shares in the Rights Issue shall vest in the Company’s shareholders with pre-emptive rights, whereby two existing shares entitle to subscription of one new share. Subscription may also be made without pre-emptive rights, as set forth in the complete issue resolution.

The record date for the right to participate in the Rights Issue shall be 4 December 2024. Subscription for new shares shall be made during the period 6 December 2024 – 20 December 2024. Trading in subscription rights is expected to take place on Nasdaq Stockholm during the period from 6 December 2024 to 17 December 2024 and trading in BTAs (paid subscribed shares) is expected to occur between 6 December 2024 up until that the Rights Issue has been registered with the Swedish Companies Registration Office, which is expected occur around 30 December 2024.

Shareholders who choose not to participate in the Rights Issue will have their share diluted by approximately 33.3 percent, upon full subscription.

Extraordinary general meeting
The board of directors’ decision regarding the Rights Issue is subject to approval by an extraordinary general meeting, which is intended to be held on 2 December 2024. The notice to the meeting will be announced in a separate press release.

Subscription undertakings, guarantee commitments and voting commitments
Provided that the extraordinary general meeting approves the board of directors’ resolution on the Rights Issue, certain existing shareholders, including Fjärde AP-fonden[1], Första AP-fonden[2] and Alecta Tjänstepension[3], have undertaken to subscribe for their respective pro rata share of the Rights Issue, corresponding to a total of 22.8 percent of the Rights Issue. These shareholders have also undertaken to vote in favor of the Rights Issue at the extraordinary general meeting. Furthermore, shareholding members of the Company's management and board of directors have expressed their intention to subscribe for shares corresponding to a total of approximately 0.7 percent of the Rights Issue.

Total subscription undertakings and intentions to subscribe thus amount to approximately 23.4 percent of the Rights Issue, corresponding to approximately SEK 39.8 million.

In addition, the Company has entered into guarantee commitments (so-called bottom guarantee) on customary terms with a number of external guarantors, which in total amount to SEK 80.3 million, corresponding to approximately 47.3 percent of the Rights Issue.

The Rights Issue is thus covered by subscription commitments, intentions to subscribe and guarantee commitments of approximately SEK 120 million, corresponding to approximately 70 percent of the Rights Issue.

For the guarantee commitments a guarantee commission of 10 percent of the guaranteed amount shall be paid as cash remuneration. No remuneration shall be paid for the subscription undertakings. Neither the subscription undertakings nor the guarantee commitments are secured by bank guarantee, blocked funds, pledges or similar arrangements.

Further information regarding the parties who have entered subscription undertakings and guaranteed commitments will be available in the prospectus that will be published before the start of the subscription period.

Lock-up undertakings
The board of directors of Cantargia and Cantargia’s management have undertaken, with customary exceptions, not to sell any shares in the Company for a period of 90 days from the settlement date of the Rights Issue.

Indicative timetable for the Rights Issue

• Extraordinary general meeting, 2 December 2024.
• The prospectus is published, 4 December 2024.
• Last day of trading in the Company’s shares, including the right to participate in the Rights Issue, 2 December 2024.
• First day of trading in the Company’s shares, excluding the right to participate in the Rights Issue, 3 December 2024.
• Record date for the Rights Issue, 4 December 2024.
• Trading in subscription rights, 6 December 2024 – 17 December 2024.
• Subscription period, 6 December 2024 – 20 December 2024.
• Trading in paid subscribed shares (BTA), 6 December 2024 – until the Rights Issue has been registered by the Swedish Companies Registration Office.
• Announcement of outcome of the Rights Issue, 23 December 2024.

Prospectus
A prospectus will be made available before the subscription period commences on Cantargia’s website, www.cantargia.com.

Advisors
In conjunction with the Rights Issue, the Company has engaged Zonda Partners as financial advisor and Vinge as legal advisor.

Webcast
In connection with the Rights Issue, Cantargia invites investors, analysts and the media to a webcast with teleconference (in English) on 7 November, at 10:00 pm (CET), where Cantargia’s CEO, Göran Forsberg, and CFO, Patrik Renblad, will present Cantargia and comment on the Rights Issue, followed by a Q&A-session.

If you wish to participate via webcast please use the link below. Via the webcast you are able to ask written questions. Webcast: https://cantargia.videosync.fi/cantargia-press-conference-2024.

If you wish to participate via teleconference please register on the link below. After registration you will be provided phone numbers and a conference ID to access the conference. You can ask questions verbally via the teleconference: https://conference.financialhearings.com/teleconference/?id=5001893.

The webcast will also be available on demand on Cantargia’s corporate website: www.cantargia.com.

For further information, please contact:

Göran Forsberg, CEO
Mobile: +46 (0)46-275 62 60
E-mail: goran.forsberg@cantargia.com

About Cantargia
Cantargia AB (publ), reg. no. 556791-6019, is a biotechnology company that develops antibody-based treatments for life-threatening diseases and has established a platform based on the protein IL1RAP, involved in a number of cancer forms and inflammatory diseases. Cantargia’s oncology program, the antibody nadunolimab (CAN04), is being studied clinically primarily in combination with chemotherapy with a focus on pancreatic cancer, non-small cell lung cancer and triple-negative breast cancer. Positive interim data for the combinations indicate stronger efficacy than would be expected from chemotherapy alone. Cantargia’s second development program, the antibody CAN10, blocks signaling via IL1RAP in a different manner than nadunolimab and addresses treatment of serious autoimmune/inflammatory diseases, with initial focus on systemic sclerosis and myocarditis.

Cantargia is listed on Nasdaq Stockholm (ticker: CANTA). More information about Cantargia is available at www.cantargia.com.

About nadunolimab (CAN04)
The antibody nadunolimab binds strongly to its target IL1RAP and functions by inducing ADCC and blocking IL-1alpha and IL-1beta signaling. Nadunolimab can thereby counteract the IL-1 system which contributes to the immune suppressive tumor microenvironment and development of resistance to chemotherapy. Nadunolimab is investigated in multiple clinical trials; the phase I/IIa trial CANFOUR, NCT03267316, evaluates nadunolimab in combination with standard chemotherapies in patients with PDAC (gemcitabine/nab-paclitaxel) or NSCLC (platinum-based chemotherapies). Positive data show durable responses for the combination therapy in 73 PDAC patients, resulting in median iPFS of 7.2 months and median OS of 13.2 months. An even higher median OS of 14.2 months was observed in a subgroup of patients with high tumor levels of IL1RAP. Strong efficacy was also observed in 40 NSCLC patients with median PFS of 7.2 months and a response rate of 55%; even higher responses were observed in non-squamous NSCLC patients. Early efficacy data from the phase Ib/II trial TRIFOUR, NCT05181462, also shows signs of promising efficacy in TNBC with a 60% response rate for nadunolimab combined with carboplatin/gemcitabine.

About CAN10
The CAN10 antibody binds strongly to its target IL1RAP and has a unique capability to simultaneously inhibit signaling via IL-1, IL-33 and IL-36. Inhibition of these signals can be of significant value in the treatment of several inflammatory or autoimmune diseases. The initial focus of CAN10 will be on two severe diseases: hidradenitis suppurativa (HS) and systemic sclerosis. In preclinical in vivo models of inflammatory diseases, such as systemic sclerosis, psoriasis, psoriatic arthritis, atherosclerosis, myocarditis and peritonitis, a CAN10 surrogate antibody significantly reduced the development of the disease. A clinical phase 1 study, investigating CAN10 in healthy volunteers and psoriasis patients, is ongoing. Up to 80 subjects may be included in the trial. Good safety is shown at the completed dose levels, and additional data from the trial are expected continuously during 2024 and 2025.

Important information
The information in this press release does not contain or constitute an offer to acquire, subscribe or otherwise trade with shares or other securities in Cantargia. No action has been taken and measures will not be taken to permit a public offering in any other jurisdictions besides Sweden.

This press release is not a prospectus according to the definition in Regulation (EU) 2017/2019 (the “Prospectus Regulation”) and has not been approved by any regulatory authority in any jurisdiction. This press release neither identifies nor pretends to identify risks (direct or indirect) that can be connected to an investment in shares or other securities in Cantargia. A prospectus will be prepared in connection with the Rights Issue and be reviewed and approved by the Swedish Financial Supervisory Authority, which is the national competent authority in Sweden with regard to the Prospectus Regulation. In order for investors to fully understand the potential risks and benefits associated with a decision to participate in the Rights Issue, any investment decision should only be made based on the information in the prospectus. Thus, investors are encouraged to review the prospectus in its entirety.

The information in this press release may not be released, published, copied, reproduced or distributed, directly or indirectly, wholly or in part, in or to the United States of America, Australia, Hong Kong, Japan, Canada, New Zealand, Switzerland, Singapore, South Africa, South Korea or any other jurisdiction where such act would be unlawful, where such action is subject to legal restrictions or would require additional registration or other measures beyond those that follow from Swedish law. Actions in violation of these restrictions may constitute a violation of applicable securities law. No shares or other securities in Cantargia have been registered, and no shares or other securities will be registered, under the United States Securities Act of 1933, as amended (“Securities Act”) or the securities legislation of any state or other jurisdiction in the United States of America and no shares or other securities may be offered, sold or otherwise transferred, directly or indirectly, in or into the United States of America, except under an available exemption from, or in a transaction not subject to, the registration requirements under the Securities Act and in compliance with the securities legislation in the relevant state or any other jurisdiction of the United States of America.

Within the European Economic Area (“EEA”), no offer of shares or other securities (“Securities”) is made to the public in any other country than Sweden. In other member states of the EU, such an offering of Securities may only be made in accordance with the Prospectus Regulation. In other member states of the EEA which have implemented the Prospectus Regulation in its national legislation, any offer of Securities may only be made in accordance with an applicable exemption in the Prospectus Regulation and/or in accordance with an applicable exemption under a relevant national implementation measure. In other member states of the EEA which have not implemented the Prospectus Regulation in its national legislation, any offer of Securities may only be made in accordance with an applicable exemption under national law.

In the United Kingdom, this document and any other materials in relation to the Securities described herein is only being distributed to, and is only directed at, and any investment or investment activity to which this document relates is available only to, and will be engaged in only with, “qualified investors” (within the meaning of the United Kingdom version of the Prospectus Regulation which is part of United Kingdom law by virtue of the European Union (Withdrawal) Act 2018) who are (i) persons having professional experience in matters relating to investments who fall within the definition of “investment professionals” in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”); (ii) high net worth entities etc. falling within Article 49(2)(a) to (d) of the Order; or (iii) such other persons to whom such investment or investment activity may lawfully be made available under the Order (all such persons together being referred to as “relevant persons”). In the United Kingdom, any investment or investment activity to which this communication relates is available only to, and will be engaged in only with, relevant persons. Persons who are not relevant persons should not take any action on the basis of this press release and should not act or rely on it.

This press release may contain forward-looking statements which reflect the Company’s current view on future events and financial and operational development. Words such as “intend”, “expect”, “anticipate”, “may”, “believe”, “plan”, “estimate” and other expressions which imply indications or predictions of future development or trends, and which are not based on historical facts, are intended to identify forward-looking statements. Forward-looking statements inherently involve both known and unknown risks and uncertainties as they depend on future events and circumstances. Forward-looking statements do not guarantee future results or development and the actual outcome could differ materially from the forward-looking statements.

This press release has been issued by and is the sole responsibility of the Company. No representation or warranty, express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by Zonda Partners or by any of their respective affiliates or agents as to, or in relation to, the accuracy or completeness of this press release or any other written or oral information made available to or publicly available to any interested party or its advisers, and any liability therefore is expressly disclaimed.

Zonda Partners is acting exclusively for the Company and no one else in connection with the Rights Issue, the content of this press release and other matters described in this press release. Zonda Partners will not regard any other person as their respective clients in relation to the Rights Issue, the content of this press release and other matters described in this press release and will not be responsible to anyone (including any placees) other than the Company for providing the protections afforded to their respective clients or for providing advice to any other person in relation to the Rights Issue, the content of this press release or any other matters referred to in this press release.

Information to distributors
Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended (“MiFID II”); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the “MiFID II Product Governance Requirements”), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any “manufacturer” (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the shares of the Company have been subject to a product approval process, which has determined that such shares are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the “EU Target Market Assessment”). Solely for the purposes of each manufacturer’s product approval process in the United Kingdom, the target market assessment in respect of the shares in the Company has led to the conclusion that: (i) the target market for such shares is only eligible counterparties, as defined in the FCA Handbook Conduct of Business Sourcebook, and professional clients, as defined in Regulation (EU) No 600/2014 as it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018 (“UK MiFIR“); and (ii) all channels for distribution of such shares to eligible counterparties and professional clients are appropriate (the “UK Target Market Assessment” and, together with the EU Target Market Assessment, the “Target Market Assessment”). Notwithstanding the Target Market Assessment, Distributors should note that: the price of the shares of the Company may decline and investors could lose all or part of their investment; the shares of the Company offer no guaranteed income and no capital protection; and an investment in the shares in the Company is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other advisers) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Rights Issue. Furthermore, it is noted that, notwithstanding the Target Market Assessment, the banks Global will only procure investors who meet the criteria of professional clients and eligible counterparties.

For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II or UK MiFIR; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the shares of the Company.

Each distributor is responsible for undertaking its own target market assessment in respect of the shares in Company and determining appropriate distribution channels.

The English text is an unofficial translation of the original Swedish text. In case of any discrepancies between the Swedish text and the English translation, the Swedish text shall prevail.

[1] Fjärde AP-fonden’s commitment is limited to such number of shares that its shareholding in the Company will not increase after the Rights Issue.
[2] Första AP-fonden’s commitment is limited to such a number of shares that its holding in the Company does not exceed 10 percent.
[3] Alecta Tjänstepension’s commitment is limited to such a number of shares that its holding in the Company does not exceed 9 percent.