Circio : Annual Report 2023 Report

Annual Report 2023

25 April 2024

Annual Report 2023
CEO Statement	5
Directors' Report	6
Management	21
Board of directors	22
Corporate Governance Report	24
Accounts and notes	34
Accounts and notes	80
Auditors report	108

Annual Report 2023

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RNA therapeutics and cancer immunotherapy are some of the fastest growing fields in medicine

Immunotherapy has revolutionized cancer treatment over the past decade, Today, millions of patients achieve long-lasting benefit from cancer immunotherapy, which has grown into a market worth over USD 35bn in 2023.

RNA therapeutics are on the same trajectory, with the first successful mRNA vaccines approved and broadly implemented for COVID-19 in 2021. mRNA vaccines are just the tip of the iceberg of the overall therapeutic potential of RNA in new disease areas to this new class of drugs. Circular RNA (circRNA) is emerging as one of the most promising RNA formats, and Circio´s powerful and differentiated circVec platform is uniquely positioned to unlock the potential of circRNA in gene therapy.

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About Circio

Circio Holding ASA (OSE: CRNA) is a biotechnology company developing novel circular RNA gene therapies and immunotherapy medicines.

Circio has established a unique circular RNA (circRNA) platform for genetic medicine. The proprietary circVec technology is based on a modular genetic cassette design for efficient biogenesis of multifunctional circRNA from DNA and viral vectors, which can be deployed in multiple disease settings. The circVec platform has demonstrated enhanced and more durable protein expression than classic mRNA vector systems, and has the potential to become the new gold-standard for DNA and virus-based therapeutics in the future. The circRNA R&D activities are being conducted by the wholly owned subsidiary Circio AB based at the Karolinska Institute in Stockholm, Sweden.

In addition, Circio is developing a cancer vaccine, TG01, targeting KRAS driver mutations. TG01 is currently being tested in three clinical trials: RAS-mutated pancreatic cancer and lung and non-resectable pancreatic cancer in US, and multiple myeloma in Norway. These studies are being run through academic collaborative networks, supported by prestigious research grants from Innovation Norway and the Norwegian Research Council, creating read-outs and future optionality for the program at low cost to Circio.

CEO Statement

During 2023 we completed a turnaround to fully focus on accelerating the circVec platform, and firmly establish Circio as a leader in the emerging circular RNA space. With our circVec 2.1 design we have reached an important technical milestone, outcompeting conventional mRNA expression for reporter systems both in vitro and in vivo. We are committed to drive this unique and powerful technology forward, with the aim to and establish circVec as a new gold-standard expression system for gene therapy and beyond.

Leading with ´CIRC´ in Circio

Under the leadership of CTO and circRNA discoverer Dr Thomas Hansen and CSO Dr Victor Levitsky we have advanced our circVec system to generation 2.1, which has demonstrated up to 10x enhanced protein expression vs. mRNA in multiple settings. We have recently shown, in initial experiments, that this powerful advantage can be maintained in vivo in mouse models for up to four months , with statistically significant enhancement of protein expression from circVec. This feature is particularly important in gene therapy where low expression is a substantial hurdle for current approaches, and we are therefore selecting genetic medicine as the lead application for our initial circVec therapeutic candidates.

Still progressing in ´IO´

The TG01 cancer vaccine has returned to the clinic in an enhanced format. Armed with a more powerful adjuvant, the same as GSK incorporates in its highly

Annual Report 2023

successful shingles, malaria and RSV vaccines, improved dosing and multiple new combination therapies, creating a broad scope of development and future partnering opportunities for our mutant RAS TG01 program. During 2023, three collaborative studies with internationally renowned experts opened for enrolment, two in the USA and one in Norway. Consistent with our strategy of advancing TG01 through collaborative efforts at low cost to Circio, all of these studies are externally sponsored and involve multiple high-profile industry and academic partners. On April 17 2024, Circio terminated its agreement with IOVaxis to develop TG01 in China due to non-payment of license fees. This does not affect the three collaborative studies described above.

Financing to support near-term progress and deliver long-term success Following the presentation of robust technical in vitro data showing statistically significant enhanced circVec vs mRNA reporter expression as well as encouraging and additionally supportive in vivo data in mouse models, on 17 April 2024 Circio announced a plan to raise around NOK 50-60min gross proceeds from existing shareholders and new investors in a partially underwritten rights issue to be completed during Q2 2024. This will provide twelve months cash runway and enable Circio to deliver important pre-clinicalmilestones for its novel circVec gene therapy formats, further enhancing and expanding the platform towards circVec 3.0, and expand the intellectual property portfolio to protect both the technology and its applications.

Looking ahead

The circVec platform can be deployed for a variety of applications, and as we demonstrate this through our ongoing technical and in vivo experimental program, we believe multiple avenues to partnerships will become available. The techincal in vivo data package confirms the potential of the circVec platform, and we are now moving forward to validate these promising data in therapeutically relevant vector formats and disease models, with an AAV-based gene therapy for

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AATD as the initial lead program. Based on our current data, plans and estimates, we aim to enter our first strategic partnership in early 2025 and select a lead therapeutic candidate for AATD by the middle of 2025.

The team and I are very excited to lead Circio forward to execute on the opportunities that lay ahead.

Dr. Erik Digman Wiklund

CEO Circio Group

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Directors' Report

2023 was a challenging year for the biotech sector in general, and Circio was no exception. Despite strong clinical data and a robust development plan endorsed by both KOLs and regulatory authorities, it was not possible to secure the substantial funding required to bring the ONCOS-102 program forward on a path to registration. As such, we were regrettably forced to make the tough decision to halt ONCOS-102 development, and in parallel part with many talented and dedicated colleagues.

However, our agile and forward-looking management team were early to identify the substantial opportunity that lies in circular RNA. When we first announced our circRNA program in late 2021, few were aware of this novel RNA format. Today, circRNA has grown into one of the most promising therapeutic concepts in the industry, with substantial recent deals and financings. Circio is one of the early innovators in this emerging space and has in short time built the powerful and differentiated circVec platform, which has the potential to disrupt current gold-standard mRNA technology in the fields of genetic medicine and vaccines.

With a new strategy centered on building a next generation circRNA pipeline engine for gene therapy and vaccines, it was a natural step to rebrand and reposition the company. The new company name ´Circio´ clearly puts circRNA at the front and center of what we do, with the IO symbolizing our heritage in immunotherapy and continued commitment to our KRAS cancer vaccine program.

The new Circio requires a different toolbox, resource level and skillset. We have therefore substantially restructured the management team, board, organization and corporate set-up, and established an R&D hub at the Karolinska Institute campus in Stockholm. We have now put a strong foundation in place from which to build a successful RNA platform company with a rich and differentiated pipeline. For our shareholders, this has the advantage of a substantially reduced cost- base and a broadened set of opportunities for value creation through both in-house development and external partnerships.

We believe that we are well-positioned for the new Circio to be successful, both scientifically and commercially. The management team, led by CEO and circRNA co-discoverer Dr Erik Digman Wiklund, is forging ahead with several innovative gene therapy concepts, and we expect important pre-clinical validation, further platform enhancement and business development milestones to materialize during 2024-25. The intended rights issue aiming to raise around NOK 50-60 million by Q2 2024 will provide Circio with twelve months cash runway and enable us to deliver on these plans and create value for existing and new shareholders. However, should this financing not be forthcoming, we must be clear that we would face the risk that the company may not be a going concern, especially if the conditions

necessary to call tranches of under the Atlas Agreement (see later) are not met. The Board of Directors is monitoring this situation closely with the management.

Strategy and strategic focus areas

Circio is a biotechnology company developing novel circular RNA and immunotherapy medicines, with the aim to become the leader in vector-delivered circRNA therapeutics for genetic medicine. In parallel, Circio intends to retain the value of its investments into the legacy mutant RAS program by seeking low-cost development opportunities through commercial and academic partnerships. The Group focuses its existing scientific and financial resources on accelerating the development of the proprietary circVec platform to capitalize on its significant early-mover advantage in the rapidly expanding fields of gene therapy and RNA therapeutics.

The Group's strategy is to:

1. Build a platform-engine for novel genetic medicine product candidates based on circVec- delivery of circRNA;

1. Further enhance and establish a robust IP portfolio protecting the design and applications of the circVec platform;

1. Identify target diseases with high unmet medical need and develop and test therapeutic circVec candidates against these pre-clinically, with initial focus on AATD as the lead program;

1. Establish pre-clinical validation of circVec for AAV gene therapy vectors and novel DNA delivery formats;

1. Establish strategic partnerships to access complementary technologies that can broaden and/or enhance the potential use of circVec;

1. Explore and validate other potential applications of circVec, such as for vaccines and oncology, and monetize these through external partnerships;

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o Test the enhanced TG01 mutant RAS cancer vaccine in multiple cancer indications and

treatment combinations, supported through external collaborations and grant funding

Pipeline and newsflow

Trials run and financed by collaboration partners

Business and technology platforms

The Group develops novel circular RNA ("circRNA") and cancer immunotherapy medicines. The Group's mission is to create a novel targeted, multi-functional circRNA therapeutics. Circio has developed a differentiated, proprietary circRNA delivery platform named circVec. circVec is a DNA- based vector system designed and optimized for efficient intra-cellular circRNA biogenesis to drive robust and durable protein expression in patients. circVec has demonstrated statistically significant enhanced protein expression vs conventional mRNA-based systems both in vitro and in vivo. Circio is focusing on gene therapy as the primary application of the circVec technology, but is also exploring expansion of the circVec platform into oncology, vaccines and cell therapy applications.

In addition, Circio is developing a cancer vaccine, TG01, targeting driver mutations in the RAS-family of genes. TG01 is currently being tested in three clinical trials in in multiple myeloma, pancreatic and lung cancer in the USA and Norway financed through external industry and academic partnerships.

Annual Report 2023

circRNA Platform

Circio is a leader in circRNA, a promising emerging class of novel RNA therapeutics. circRNA offers several advantages over mRNA, including substantially prolonged half-life and enhanced protein expression. circRNA co-discoverer and pioneer Dr Thomas B Hansen, CTO at Circio, is building the circVec platform technology together with an experienced scientific team located at the Karolinska Institute in Stockholm, Sweden.

Circio has a unique, proprietary platform technology for circRNA delivery, circVec. circVec is a vector system designed for efficient circRNA expression which has potential use in multiple disease areas. circVec offers several advantages over synthetic circRNA approaches, including durability, scalability and expression level, and has the potential to boost the potency of current gold-standard gene therapy approaches. To date, technical proof-of-concept (PoC) has been established for the circVec approach in multiple vector formats, demonstrating clear advantages over traditional mRNA-based expression systems. Key design features for optimal circRNA biogenesis and high level of protein expression have been identified and validated, and several patent applications covering the core elements of the circVec concept have been filed to protect this powerful platform technology.

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Circio is aiming to further expand and enhance the circVec platform, and to demonstrate the benefit and versatility for several therapeutic applications in vivo during 2024. Following generation of robust, statistically significant technical proof-of-conceptin vivo, Circio is now exploring the design and performance of circVec in relevant therapeutic vector formats and disease areas. The aim is to generate in vivo proof-of-concept in disease models within the next twelve months, and subsequently proceed towards selecting a lead candidate to bring forward towards clinical entry. Circio plans to develop future therapeutic circVec candidates both in house and through partnering with pharmaceutical companies.

Mutant KRAS platform

Oncogenic KRAS mutations drive around 30% of all cancers and are considered highly attractive targets in cancer drug development. TG01 has shown promising efficacy in previous clinical trials, including 6-month survival benefit over standard of care in surgically resected pancreatic cancer, and TG01 has attained Orphan Drug Designation in pancreatic cancer in both the USA and Europe.

TG01 is currently being tested in three externally sponsored clinical trials in RAS-mutated pancreatic cancer, lung cancer and multiple myeloma in the USA and Norway. These studies are being run through academic and industry collaborative networks, supported by prestigious research grants from Innovation Norway and the Norwegian Research Council, creating future optionality for the program at low cost to Circio.

Surgically resected pancreatic Cancer

In March 2023, the first patient was dosed in the USA with TG01 in the combination study with PD-1 checkpoint inhibitor (CPI) balstilimab in mutant RAS pancreatic cancer. Oncogenic RAS mutations are found in more than 90% of pancreatic cancer patients, but there are no approved therapies available against this important genetic driver. As such, there is a major unmet medical need for novel, effective agents to improve outcomes for pancreatic cancer patients.

The trial is led by gastrointestinal cancer expert Dr. Anup Kasi in a clinical collaboration between Kansas University Cancer Center (KUCC), Agenus and Circio, and was the first study to dose a patient with the TG01 vaccine enhanced by immune-stimulatory adjuvant QS-21 STIMULON™ from Agenus. In Dr. Kasi´s study, 24 pancreatic cancer patients who have detectable tumor DNA in the blood following surgery and follow-up treatment will be randomly allocated to either TG/QS-21 vaccination alone or vaccination combined with PD-1 CPI balstilimab. The aim is to evaluate whether mutant RAS T-cell responses generated by TG01, and further boosted by QS-21 STIMULON and balstilimab, may have the potential to eliminate remaining cancer cells to prolong time to relapse and extend patient survival.

Multiple Myeloma

The enhanced TG01 vaccine is also being tested in a phase 1 trial at Oslo University Hospital (OUS) evaluating TG01/QS-21 in RAS-mutated multiple myeloma (MM). Although 15-20% of multiple myeloma patients harbor RAS driver mutations, there are currently no available RAS-targeted treatment alternatives for this cancer indication, and the study thereby addresses a major unmet medical need.

The trial is sponsored and funded by OUS and supported by the research grants from Innovation Norway and the Norwegian Research Council. The trial is a collaboration between OUS, and Circio and is testing TG01 vaccination as a maintenance monotherapy in 20 KRAS or NRAS mutated MM patients who continue to have measurable disease after completion of SoC treatment. The study is led by multiple myeloma expert Dr. Fredrik Schjesvold. In December 2023, the trial passed the planned safety cohort review without any concerns, and the study is open for full enrollment of twenty patients in total.

Lung and Pancreatic Cancer

In November 2023, Circio announced a new study at Georgetown University in Washington D.C., USA, as part of a research collaboration agreement with Janssen and Bristol Myers Squibb (BMS) to test its drug candidate TG01 in a triple combination regimen with daratumumab (anti-CD38) and nivolumab (anti-PD1) in patients with RAS-mutated pancreatic and lung cancers. The study will be the first time TG01 is tested in a broader immunotherapy regimen designed to overcome resistance to anti-PD-1 checkpoint blockade.

The trial is sponsored by Georgetown University with funding from Janssen. The triple therapy combination will be tested in 54 patients in total, 27 immunotherapy-naïveKRAS-mutated patients with pancreatic cancer and 27 KRAS-mutated patients with NSCLC who have progressed on prior anti-PD1 therapy. The study opened in December 2023, and the first patient was dosed in early 2024.

IPR / Market exclusivity

Circio´s patent portfolio is designed to protect the technological platform and specific drug candidates and their therapeutic applications, and includes several families of patents and patent applications covering drug compositions and relevant combination therapies. Following successful pre-clinical circRNA generation and design research, patent applications covering critical aspects of the circVec platform and applications have been filed. Further development and optimization are continuously ongoing and new patent applications will be filed to broaden and strengthen the IP protection of the unique circVec platform.

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Important events in 2023

1. In February, agreed the terms and conditions for a convertible bond facility with Atlas Special Opportunities ("Atlas") with the aim of securing financing of up to gross NOK 300 million over three years, subject to certain conditions.

1. In March, the extraordinary general meeting (EGM) of Circio approved the Atlas agreement.

1. In March, requested Atlas to subscribe and pay for the first tranche of convertible bonds with an aggregate principal amount equal to NOK 37,500,000.

1. In March, dosed the first patient with cancer vaccine TG01 in the combination study with PD-1 checkpoint inhibitor (CPI) balstilimab in mutant RAS pancreatic cancer in the USA.

1. In March, announced the circRNA platform to be the main focus of the company to capitalize on its early-mover advantage and globally competitive position. The development of ONCOS-102 was put on hold subject to further funding or partnering. Later it was communicated that development stopped.

1. In April, the AGM approved to change the name of the company to Circio to reflect the strategic shift in the portfolio and the focus on the circVec circRNA platform.

1. In April, presented circRNA R&D development in the poster "circAde: a circRNA-basedsystem for prolonged and more effective treatment of cancer" at the AACR Annual Meeting in April 2023, in Orlando, USA.

1. In June, dosed the first patient with cancer vaccine TG01 in the multiple myeloma study at Oslo University Hospital

1. In June, Circio started the reorganization process to streamline operations and reduce costs to focus resources on developing the new circVec platform.

1. In October, presented powerful circVec 2.0 generation expression data in the poster
   "circVec: a versatile circular RNA vector cassette for enhanced and durable intra-cellular protein expression" at the European Society of Gene and Cell Therapy (ESGCT) Annual Meeting in Brussels in October 2023.

1. In November, announced a collaboration with Georgetown University, Janssen and BMS to test the combination of TG01 mutant RAS vaccination with daratumumab and nivolumab in immunotherapy resistant patients with RAS-mutated pancreatic and lung cancer.

Annual Report 2023

1. In November, announced that the European Patent Office (EPO) board of appeal has moved to revoke the EU Patent 3140320 "Peptide vaccine comprising mutant RAS peptide and chemotherapeutic agent".

1. In December, completed the planned safety cohort review in the TG01 study at Oslo University Hospital with no concerns reported, and the study opened for full enrollment.

Important events after balance sheet date

1. In January 2024, it was announced that Business Finland has approved Circio's application for a waiver in full of three R&D loans totaling EUR 6.2 million granted for the development of ONCOS-102. As a result, Circio's equity will be increased by a corresponding amount.

1. In March 2024, following the approval by the Chinese National Medical Products Administration (NMPA) of the investigational new drug (IND) application, IOVaxis exercised the option for an exclusive license to mutant RAS cancer vaccine TG01 in China. The parties agreed that IOVaxis will pay USD 300.000 of the USD 3.000.000 option fee to Circio immediately, and that the remaining payment to be due by 15 September 2024.

1. In April 2024, announced that it has terminated TG01 cancer vaccine license option agreement with IOVaxis in China for non-payment. IOVaxis did not met the first financial payment milestone and Circio therefore decided to terminate the TG01 license agreement in China and the Group will now seek alternative partnering options in China for the TG01 program.

1. In April 2024, announced that it is initiating a fundraising process with the intent to raise around NOK 50-60 million or more in gross proceeds from existing shareholders and new investors in a partially underwritten rights issue to be completed during Q2 2024. Existing convertible bond investor Atlas Capital Markets is supportive of, and intends to participate in, the intended fundraising. Members of Circio´s board and management have pre- committed to participate with around NOK 2 million, including NOK 500.000 by CEO Dr. Erik D Wiklund. Circio will update the market in due time when the structure and timing of the intended transaction have been determined.

1. In April 2024, announced that it has established early technical in vivo proof-of-concept for its proprietary circVec circular RNA platform by demonstrating statistically significant improvement in durability over mRNA-based expression. The circVec technology has broad potential, particularly to enhance the potency and reduce cost of current gold-standard gene therapy, and the R&D strategy is centered on this rapidly expanding therapeutic area.

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