Polski Bank Komórek Macierzystych S A : Pdf PBKM Group financial results in 2020 press release (277 KB)

Press release

Warsaw, March 31, 2021

PBKM Group to increase revenues by 12% in 2020

PBKM Group is working on a new strategy to determine, among other things, the directions of

development and new areas of the Group's operations in Europe

In 2020, Polski Bank Komórek Macierzystych S.A. (Polish Stem Cells Bank - PBKM, PBKM Group) - which leads the international FamiCord Group, the largest stem cell bank in Europe with a 38% market share - generated:

• PLN 211.3 million in consolidated sales revenue
• PLN 29.3 million in EBITDA (adjusted for one-off events)
• PLN 9.3 million net profit (adjusted for one-off events)

"In 2020, a 12% increase in revenue to over PLN 211 million was recorded. EBITDA (adjusted for one-off events) was PLN 29.3 million, cash EBITDA (adjusted for one-off events) was PLN 16.7 million and net profit (adjusted for one-off events) was over PLN 9 million. In almost all markets where the FamiCord Group operates, an adverse impact of COVID-19 coronavirus pandemic on sales and profitability was encountered last year. In the case of our business, the pandemic significantly reduced or totally eliminated access to key offline sales channels for an extended period of time, in particular birth schools, hospitals and doctors' offices. Therefore, the FamiCord Group could not achieve full- year 2020 sales and profitability at 2019 figures. The profitability was also affected by higher sales and marketing costs associated with the expansion of sales structures and presence in new markets, as well as costs of consolidation of companies that joined the FamiCord Group in 2020," says Jakub Baran, co-founder,shareholder and CEO of

PBKM S.A.

The COVID-19 crisis can become a turning point which begins the transition from today's seller-friendly M&A market to a more buyer-friendly market. The PBKM Group has the capital to make further acquisitions, as in early 2020 it completed a share issue worth over PLN 218 million, which by its value was the second largest share issue passed in 2019 by a public company listed on the Warsaw Stock Exchange. Last year, the company made three acquisitions: in Italy, Germany and Turkey, and two smaller ones (Czech Republic and Slovakia) were already made in 2021.

"I estimate that today around 38% of cord blood donations in Europe are processed in the laboratories of the FamiCord Group. This share has increased by 3% since the beginning of last year. We want to have an even higher share as long as it makes economic sense, so we can expect further acquisitions in the near future, both in countries where we are already active and in new markets. We see a need for a stronger presence in Western Europe, as to date the FamiCord Group has been primarily active in Southern and Central and Eastern Europe. We will pursue such activities this year and in the coming years, which should be reflected in further acquisitions and organic entries into new markets. In addition, PBKM's majority shareholder, AOC Health, has announced that it will seek to merge the DACH market leader

• Vita34 - with PBKM. Such a merger will be important in further consolidation of the European market," says Jakub Baran.

In the year 2020, the FamiCord Group carried out works related to the preparation of a new strategy for the purpose of development of the Group.

"In terms of financing, the issue has been resolved: we have a leading financial shareholder, which is the AOC fund. However, final decisions on business development priorities have not yet been made. The strategy will define the directions of development and new areas of activity for the FamiCord Group. We will also review the growth prospects as part of the individual markets in which we have been operating. I can already say that the greatest potential for growth in Germany and Turkey is in our hands. We plan to announce the new strategy of the FamiCord Group later this year," comments Jakub Baran.

In 2020, the PBKM Group continued its commitment to researching the opportunities arising from the use of stem cells in experimental therapies. As the only Polish commercial entity, PBKM is a member of three consortia under the

Strategmed II programme, as part of which stem cell therapies have been launched, including in cardiology, diabetes, and dermatology/aesthetic medicine.

More than 680 injections of different types of stem cell fractions into patients, mainly in the area of cardiology and dermatology, have been performed in four clinical trials and one trial which was transformed into a medical experiment. At this stage, the complete safety of the therapy applied can be confirmed both in the case of application of autologous cells obtained from adipose tissue and allogeneic cells obtained from the umbilical cord.

Moreover, under the InnoNeuroPharm sector programme hosted by the National Centre for Research and Development (NCBiR), PBKM is implementing the ALSTEM project, as part of which an innovative advanced therapy medicinal product based on Wharton's jelly mesenchymal cells for the treatment of amyotrophic lateral sclerosis is being developed. Two clinical trials are planned as part of the ALSTEM project. The first one included the recruitment of several patients and the start of administration of the ATIMP drug based on umbilical cord stem cells. Previously, due to cooperation with the Polish Academy of Sciences, pre-clinical animal studies were successfully carried out.

"In 2020, the results of the treatment of ALS patients with stem cells administered through a medical therapeutic experiment were published in an authoritative scientific journal. These results confirmed the safety of the therapy; thanks to it, we were able to identify a population of patients who respond better to the treatment than others. We want at least to confirm these results as part of the aforementioned clinical trials," says Jakub Baran.

A year ago, THE PBKM Group launched a new project related to the introduction of THE CAR-T technology in Poland. The company FamiCordTx was established to carry out this project. The company holds an exclusive licence for Europe, Russia and Turkey from iCell Gene Therapeutics Inc. from the USA to use CAR-T technology, which is currently considered the world's most innovative therapy for treating blood cancers. In 2020, full transfer of the technology to Poland was carried out; the first test trials proved that a therapeutic product could be obtained under laboratory conditions.

"This year, we want to obtain the relevant consent and authorisation from the Chief Pharmaceutical Inspector to enable production under GMP conditions of the CAR-T drug for human use. The first application to the GIF was submitted in March this year. Another application will be submitted in the coming weeks. In addition, this year we are planning to register our own clinical trial. Initial expenditure on research is estimated at several million zlotys. Of course, the total cost of the project will be significantly higher. Therefore, the scenario of raising additional funds primarily from private investors is expected as early as 2021, and as part of the long-term planning we will consider a listing on the capital market. Frankly speaking, we have already received first tangible declarations from the investors who are interested in raising capital in FamiCordTx," says Jakub Baran.

The coronavirus pandemic has also given a boost to research into the use of stem cells for the purpose of treating COVID-19 and post-COVID-19 related symptoms. More than 60 clinical trials in this area are currently underway worldwide. The results published so far have confirmed the safety of the therapy and, some of them, its effectiveness in certain cases. The results should be approached with considerable prudence. Data on a larger number of patients are certainly needed to reliably assess the impact of stem cells. However, it is very important to note that in many parts of the world, teams of eminent experts have independently provided positive evaluation of the possibility of treating COVID-19 and post-COVID-19 complications with stem cells.

"The PBKM Group is involved in COVID-19 therapies in several countries, including Portugal, where we have received a small grant for this purpose. We also look forward to supplying the Pro Trans product to PBKM's Swedish customer

• NextCellPharma (NCP). NCP is to carry out a clinical trial in Sweden in this regard (approval has already been obtained from the relevant authorities) and, in addition, to supply the Pro Trans product manufactured by PBKM in Warsaw for the purpose of clinical trial in Canada. We are also working on it in Poland and other countries," comments Jakub Baran.

Number of stored and acquired samples

At the end of 2020, the PBKM Group stored 358,098 cord blood or tissue samples in the B2C segment; 16% more than at the end of 2019.

Altogether, as part of the B2C and B2B segments, the number of stored cord blood or tissue samples in the PBKM Group at the end of 2020 was 390,000, which made a 17% increase compared to the end of 2019. The total number of all stored biological materials reached 530,000.

In 2020, the PBKM Group acquired almost 26,000 new samples in the B2C segment, up 1% on the same period last year. The share of subscription contracts in 2020 changed and now stands at 35.9% compared to 38.7% at the end of 2019, as a consequence of the acquisition in 2020 of companies with a predominantly prepaid payment model. The total number of new samples acquired in the B2C and B2B segments in 2020 was over 28,000.

Except that, as part of its agreement with Cryo-Save AG related to the storage of all stem cell preparations belonging to Cryo-Save, the PBKM Group stores biological material belonging to around 300,000 families in its own laboratories.

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About PBKM

Polski Bank Komórek Macierzystych spearheads the international FamiCord Group which manages stem cell banks located in Europe. Taking into account the number of newly acquired samples, the Group is by far the largest bank in Europe with around 38% of the market share, including the latest acquisitions in Italy, Germany and Turkey. At the end of 2020, the Group stored 390 thousand of umbilical cord blood or tissues and 530 thousand all biological samples. The main area of PBKM's activity is the collection, processing and long-term storage of stem cells extracted from umbilical cord blood and other postnatal tissues as commissioned by parents (family banking). The purpose of banking is to ensure family safety in the event of a serious illness requiring a transplantation of stem cells to a donor or to members of her/his immediate family.

FamiCord Group is present on several European markets. Directly offers services to clients in Poland, Turkey, Spain, Portugal, Hungary, Romania, Switzerland, Italy and Latvia. Almost everywhere is the number 1 on the market. In addition, it provides services for partners who acquire customers in Sweden, Denmark, Serbia and the Balkan countries, Italy and Ukraine. The Group's services are carried out through a network of own banks and cooperating banks located, among others, in Germany, USA and UK.

In addition, the Group invests in the development of advanced therapy medicinal products (ATMP) services, which are considered to be one of the most important directions of development in medicine. PBKM Group is currently involved 4 clinical trials and a medical research experiment in which patients have been given stem cell fraction drugs more than 680 times.

Since May 2016 PBKM has been listed on the main market of the Warsaw Stock Exchange.

More information at:www.pbkm.pl,https://akcjonariusze.pbkm.pl/

Twitter@PBKM_FamiCord

Media contact: Michał Wierzchowski, cc group, tel. [phone], e-mail:[e-mail]