GC019F

Reported interim readouts for lead CAR-T product candidates: FasTCAR-enabled dual-targeting BCMA/CD19 autologous CAR-T product candidate GC012F for the treatment of multiple myeloma and TruUCAR-enabled CD7-directed CAR-T product candidate GC027 for the treatment of T-ALL Completed initial public offering of ADSs for net proceeds of $220 million (USD); approximately $338 million* in cash as of January 31, 2021 Conference call tomorrow, March 10, 2021 at 8:00 am ET SUZHOU and SHANGHAI, China, March 09, 2021 (GLOBE NEWSWIRE) -- Gracell Biotechnologies Inc. (NASDAQ: GRCL) (“Gracell”), a global clinical-stage biopharmaceutical company dedicated to discovering and developing highly efficacious and affordable cell therapies, today reported its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2020 and recent business highlights. Gracell will host a conference call tomorrow, Wednesday, March 10, at 8:00 am Eastern Time. “We are very pleased with the substantial progress made thus far in 2021 and over the course of 2020. We recently closed a successful initial public offering that was supported by top-tier institutional investors. We believe their support reflects confidence in our proprietary FasTCAR and TruUCAR platforms that enable highly differentiated autologous and allogeneic CAR-T therapies,” commented Dr. William (Wei) Cao, founder, Chairman, and CEO of Gracell. “Our lead asset GC012F, a FasTCAR-enabled dual-targeting BCMA/CD19 CAR-T cell therapy, currently being studied in multiple myeloma, has shown promising results including high risk patients. We were thrilled to present results from an interim analysis at last year’s American Society of Hematology (ASH) Annual Meeting. We look forward to providing further updates at upcoming scientific meetings.” “Following the success of our recent business developments, the Gracell team continues to feel energized as we work towards accomplishing our operational goals for 2021. Looking ahead, we are well-positioned to continue to fund our R&D programs and expansion of operations in China and the U.S. We have just recently received IND approval in China for GC019F, a FasTCAR-enabled CD19-targeted CAR-T therapy for the treatment of B-ALL, and we believe this is a validation of our next-day manufacturing FasTCAR platform. We look forward to sharing updates of our lead programs at major medical conferences. To support our clinical operations, we plan to establish R&D capabilities in the U.S. and to significantly expand our GMP manufacturing facility in China during 2021 and beyond. With tremendous energy and dedication, we will continue to strive towards advancing our innovative CAR-T pipeline for difficult to treat cancers while driving further value for our shareholders,” concluded Dr. Cao. * Translation from Renminbi to U.S. dollars of cash balance on January 31, 2021 is for the convenience of the reader and made at a rate of RMB6.4709 to US$1.00, the rate in effect as of January 31, 2021. 2020 and Subsequent Highlights GC012F for the treatment of multiple myeloma (MM): GC012F is a FasTCAR-enabled dual-targeting BCMA/CD19 autologous chimeric antigen receptor (CAR)-T cell therapy that is currently being studied in an ongoing Phase 1 investigator-initiated trial (IIT) in China for the treatment of MM patients who are relapsed from or refractory to (R/R) prior therapies. An interim data readout was presented as an oral presentation at the ASH’s 2020 Annual Meeting (Press Release Dec 2020) • As of July 17, 2020, the study had enrolled and treated 16 patients at three dose levels with the highest dose level at 3x105 cells/kg. Notably, the vast majority of this study population (93.8%) belong to a subgroup of MM patients with high-risk features, a difficult to treat patient population. Overall Response Rate (ORR) at time of data cut off was 93.8% with responses being VGPR or better. 100% of the patients treated at the highest dose level (n=6) achieved minimal residual disease negative stringent complete response (MRD- sCR) that was maintained through a landmark analysis at six months (n=4). GC012F showed a favorable safety profile with primarily low grade cytokine release syndrome (CRS) (14 out of 16 patients (87.5%) Grade 1/2, 2 (12.5%) patients Grade 3, no Grade 4 or 5) and no patients experienced any immune effector cell-associated neurotoxicity syndrome (ICANS) GC019F for the treatment of with B-cell acute lymphoblastic leukemia (B-ALL): GC019F is a FasTCAR-enabled CD19-targeted autologous CAR-T cell therapy for the treatment of R/R B-ALL. China’s National Medical Products Administration (NMPA) has approved an investigational new drug (IND) application for the Phase I study of GC019F (Press Release Jan 2021) GC027 for the treatment of adult T cell acute lymphoblastic leukemia (T-ALL): GC027 is a TruUCAR-enabled allogeneic CD7-targeted CAR-T cell therapy being studied in an ongoing Phase 1 IIT in China for the treatment of adult R/R T-ALL. GC027 is manufactured from T cells of non-HLA (human leukocyte antigen)-matched healthy donors. Preliminary efficacy and safety data were presented as oral presentations at AACR (the American Association for Cancer Research) Virtual Annual Meeting 2020 (Press Release April 2020) and EHA (European Hematology Association) 25th Annual Congress 2020. • As of February 2020, the study had enrolled and treated five patients who had failed a median of five prior-lines of therapy. All five evaluable patients achieved a response, CR or CRi, including four patients, or 80%, achieving MRD- CR on Day 28 after treatment. Four out of five patients experienced CRS of Grade 3 and one out of five patients experienced CRS of Grade 4. No patients developed ICANS or graft-versus-host-disease (GvHD) GC007g for the treatment of B-ALL: GC007g is a donor-derived allogeneic CD19-targeted CAR-T cell therapy for the treatment of R/R B-ALL patients who failed transplant and may not be eligible for autologous CAR-T therapy. The allogeneic approach, utilizing T-cells from an HLA-matched healthy donor, has the potential to provide a novel treatment approach to patients not eligible for standard of care. China’s NMPA approved a pivotal seamless Phase 1/2 clinical trial for GC007g. (Press Release Jan 2021) The study is ongoing and accruing patients Corporate Highlights: Expanded executive leadership team with appointments of Chief Medical Officer Dr. Martina Sersch, M.D., and Chief Financial Officer Dr. Kevin Xie, both bringing extensive knowledge and leadership experience to Gracell (Press Release July 2020) Secured $100 million in Series C funding in a round led by Wellington Management Company, OrbiMed and Morningside Ventures, and joined by Vivo Capital. Existing investors Temasek Holdings, Lilly Asia Ventures, and King Star Med LP also participated (Press Release Oct 2020) Completed a successful initial public offering of American Depositary Shares (ADSs), raising net proceeds of approximately $220 million, and commenced trading on the NASDAQ Global Select Market under the ticker symbol “GRCL” (Press Release Jan 2021) Gracell’s manufacturing site in Suzhou has been granted the Medical Products Manufacturing Certificate from the Jiangsu Medical Products Administration (JSMPA, Jiangsu is a province/state in China) for the production of CAR-T cell therapy products (Press Release Jan 2021) Financial Results for the Fourth Quarter Ended December 31, 2020 Research and development expenses for the three months ended December 31, 2020 were RMB60.7 million (US$9.3 million), as compared to RMB38.0 million in the corresponding prior year period. This increase was primarily driven by increases of RMB10.4 million (US$1.6 million) in costs incurred to advance preclinical and clinical pipeline as well as increases of RMB7.4 million (US$1.1 million) and RMB 1.4 million (US$0.2 million) in depreciation expenses of manufacturing facilities and labor costs, respectively. Administrative expenses for the three months ended December 31, 2020 were RMB24.8 million (US$3.8 million), compared to RMB7.9 million for the corresponding prior year period. This increase was primarily related to an increase of RMB11.4 million (US$ 1.7 million) of professional service fees and also an increase of RMB4.9 million (US$0.8 million) attributable to the expansion of administrative functions to support research and development activities. Interest income for the fourth quarter of 2020 was RMB0.5 million (US$0.07 million) as compared to RMB1.4 million for the corresponding prior year period. Other income for the fourth quarter of 2020 was RMB2.9 million (US$0.4 million) as compared to RMB1.3 million for the corresponding prior year period. Foreign exchange loss for the three months ended December 31, 2020 was RMB0.7 million (US$0.1 million), compared to a foreign exchange gain of RMB0.4 million for the corresponding prior year period. This change in the foreign exchange gain of RMB1.1 million was primarily attributable to increase in United States dollars received along with the issuance of Series C convertible redeemable preferred shares and less favorable foreign exchange rate fluctuation during the quarter ended December 31, 2020. Net loss attributable to ordinary shareholders for the three months ended December 31, 2020 was RMB99.9 million (US$15.3 million), compared to RMB53.4 million for the corresponding prior year period. Financial Results for the Fiscal Year Ended December 31, 2020 Research and development expenses for the year ended December 31, 2020 were RMB168.8 million (US$25.9 million) compared to RMB119.2 million for the year ended December 31, 2019. This increase was primarily due to increases of RMB21.9 million (US$3.4 million) in manufacturing and other costs to support the progression of our preclinical studies and clinical trials, an increase of RMB5.3 million (US$0.8 million) in payroll and other personnel expenses related to expanded research and development headcount, and an increase of RMB17.1 million (US$2.6 million) in depreciation expenses of manufacturing facilities. Administrative expenses for the year ended December 31, 2020 were RMB45.6 million (US$7.0 million) as compared to RMB27.4 million for the year ended December 31, 2019. This increase was primarily due to an increase of RMB12.2million (US$1.9 million) in professional service fees and an increase of RMB4.5 million (US$0.7 million) in personnel costs attributable to the expansion of administrative functions. Interest income for the year ended December 31, 2020 was RMB2.9 million (US$0.4 million) as compared to RMB3.9 million for the year ended December 31, 2019. Other income for the year ended December 31, 2020 was RMB4.7 million (US$0.7 million), compared to RMB1.4 million for the year ended December 31, 2019. Foreign exchange loss for the year ended December 31, 2020 was RMB2.9 million (US$0.4 million), compared to a foreign exchange gain of RMB2.6 million for the year ended December 31, 2019. This decrease in the foreign exchange gain of RMB5.5 million was primarily attributable to increase in United States dollars received along with the issuance of Series C convertible redeemable preferred shares and less favorable foreign exchange rate fluctuation during the year ended December 31, 2020. Net loss attributable to ordinary shareholders for the year ended December 31, 2020 was RMB274.6 million (US$42.1 million), compared to RMB200.9 million for the year ended December 31, 2019. Balance Sheet Highlights As of December 31, 2020, we had RMB773.1 million (US$118.5 million) in cash and cash equivalents and short-term investments. Subsequent to December 31, 2020, we completed an initial public offering of 11,000,000 American Depositary Shares ("ADSs"), each representing five ordinary shares, at a public offering price of $19.00 per ADS. In connection with the initial public offering, we granted the underwriters an option to purchase up to an additional 1,650,000 ADSs at the initial public offering price. The net proceeds to the Company were approximately US$220 million (including in connection with the underwriters’ exercise of their option to purchase additional ADSs in full). In addition, as of December 31, 2020, the Company had short-term borrowings and current portion of long-term borrowings of RMB50.0 million (US$7.7 million) and long-term borrowings of RMB51.9 million (US$8.0 million). Conference Call Details Wednesday, March 10, 2021 at 8:00 am ET Investor domestic dial-in: 877-407-0784 Investor international dial-in: 201-689-8560 Conference ID: 13716516 Webcast link: The webcast replay will be available on the Gracell website at ir.gracellbio.com for 90 days following the completion of the call. About FasTCAR CAR-T cells manufactured on Gracell’s proprietary FasTCAR platform appear younger, less exhausted and show enhanced proliferation, persistence, bone marrow migration and tumor cell clearance activities as demonstrated in preclinical studies. With next-day manufacturing (22 to 36 hours), FasTCAR is able to significantly improve cell production efficiency which may result in meaningful cost savings, increasing the accessibility of cell therapies for cancer patients. About TruUCAR TruUCAR is Gracell's proprietary technology platform and is designed to generate high-quality allogeneic CAR-T cell therapies that can be administered “off-the-shelf” at lower cost and with greater convenience. With differentiated design enabled by gene editing, TruUCAR is designed to control host vs. graft rejection as well as graft vs host disease (GvHD) without the need of being co-ministered with immunosuppressive antibody drugs. About Gracell Gracell Biotechnologies Inc. ("Gracell") is a global clinical-stage biopharmaceutical company dedicated to discovering and developing breakthrough cell therapies. Leveraging its pioneering FasTCAR and TruUCAR technology platforms, Gracell is developing a rich clinical-stage pipeline of multiple autologous and allogeneic product candidates with the potential to overcome major industry challenges that persist with conventional CAR-T therapies, including lengthy manufacturing time, suboptimal production quality, high therapy cost and lack of effective CAR-T therapies for solid tumors. Exchange Rate Information This announcement contains translations of certain RMB amounts into U.S. dollars at a specified rate solely for the convenience of the reader. Unless otherwise noted, all translations from Renminbi to U.S. dollars are made at a rate of RMB6.5250 to US$1.00, the rate in effect as of December 31, 2020 published by the Federal Reserve Board. Cautionary Note Regarding Forward-Looking Statements Statements in this press release about future expectations, plans and prospects, as well as any other statements regarding matters that are not historical facts, may constitute "forward-looking statements" within the meaning of The Private Securities Litigation Reform Act of 1995. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "potential," "predict," "project," "should," "target," "will," "would" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: the clinical results of our product candidates, actions of regulatory agencies, which may affect the initiation, timing and progress of our clinical trials and marketing approval, our ability to achieve commercial success if any of our product candidates is approved, our ability to obtain and maintain protection of intellectual property for our product candidates and technology platforms, the future developments of the COVID-19 outbreaks, and other factors more fully discussed in the "Risk Factors" section of the final prospectus filed with the Securities and Exchange Commission (the “SEC”) and in any subsequent filings made by the Company with the SEC. Any forward-looking statements contained in this press release speak only as of the date hereof, and Gracell specifically disclaims any obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise. Readers should not rely upon the information on this page as current or accurate after its publication date. Media Contact Marvin Tang marvin.tang@gracellbio.com Investor Contact Gracie Tong Gracie.tong@gracellbio.com GRACELL BIOTECHNOLOGIES INC. CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2019 AND 2020 (All amounts in thousands, except for share and per share data, unless otherwise noted) Note 1: The unaudited pro forma balance sheet information as of December 31, 2020 assumes the automatic conversion of all of the outstanding convertible preferred shares into ordinary shares at a conversion ratio of 1:1, as if the conversion had occurred as of December 31, 2020. GRACELL BIOTECHNOLOGIES INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS FOR THE YEARS ENDED DECEMBER 31, 2018, 2019 AND 2020 (All amounts in thousands, except for share and per share data, unless otherwise noted)

The year is starting off with a number of biopharma and life sciences initial public offerings (IPOs). Last year was a record number of IPOs in the biotech industry, with 81 raising $13.5 billion. With this kind of a start, 2021 may be scorching. TCR2 Therapeutics – The Cambridge, Mass. company announced pricing for its underwritten offering of 4,590,164 shares on January 20 of $30.50 per share. The company hopes to raise $140 million of common stock, which will be used to advance its clinical and earlier stage programs and for R&D, working capital and general corporate purposes. TCR2 is developing novel T-cell therapies for solid tumors and hematological cancers. Its T-cell receptor (TCR) Fusion Construct T cells (TRuC-T cells) recognize and kill cancer cells by leveraging signaling from the entire TCR. TC-210 is currently in a Phase I/II trial for mesothelin-positive non-small cell lung cancer (NSCLC), ovarian cancer, malignant pleural/peritoneal mesothelioma, and cholangiocarcinoma. TC-110 is in a Phase I/II trial for CD19-positive adult acute lymphoblastic leukemia (aALL) and with aggressive or indolent non-Hodgkin lymphoma (NHL). Syros Pharmaceuticals – Syros announced a follow-on public offering on January 20, offering 5.4 million shares of common stock at $14 per share, to raise $75.6 million. Their original IPO was in July 2016. The proceeds of the follow-on will be used to fund its ongoing clinical and preclinical programs. Its lead compound is SY-1425, a first-in-class oral selective RARalpha agonist in RARA-positive patients with higher-risk myelodysplastic syndrome and acute myeloid leukemia. Other products include SY-2101, a novel oral form of arsenic trioxide for acute promyelocytic leukemia, and SY-5609, a highly selective and potent oral CDK7 inhibitor for solid tumors. Gracell Biotechnologies – On January 19, Gracell completed its $209 million IPO of 11 million American depositary shares, each representing five ordinary shares. The company is using its pioneering FasTCAR and TruUCAR technology platforms to discover and develop breakthrough cell therapies. The company is based in Suzhou and Shanghai, China. On January 19, its investigational new drug (IND) for GC019F, a FasTCAR-enabled CAR-T therapy in relapsed or refractory adult B-cell acute lymphoblastic leukemia (B-ALL) was approved by China’s National Medical Products Administration (NMPA). Ortho Clinical Diagnostics Holdings – Ortho launched its IPO of ordinary shares on January 19. It is offering 70 million ordinary shares with a price between $20 and $23 per share. It hopes to raise about $160 million in aggregate principal amount of 7.375% senior notes due 2025 and $270 million in aggregate principal amount of 7.250% senior notes due 2028. Ortho Clinical Diagnostics is a leader in in vitro diagnostics. On January 12, its VITROS SARS-CoV-2 Antigen Test for mass-scale COVID-19 testing received FDA Emergency Use Authorization. Cullinan Management – On January 4, Cullinan Management announced its IPO to raise $150 million by offering 8.3 million at $17 to $19 per share. The company, previously named Cullinan Oncology, is listed on the Nasdaq under the CGEM ticker symbol. It has a diversified pipeline of targeted oncology and immuno-oncology therapeutics. Its lead candidate is CLN-081, an oral small molecule designed to be a next-generation, irreversible EGFR inhibitor. It is now in a Phase I/IIa trial for adult NSCLC with EGFRex20ins mutations. Other products include CLNB-049, a bispecific antibody against FLT3 and CD3 and CLN-619, a monoclonal antibody that simulates NK and T-cell responses. Qilian International – Jiuquan, China-based Qilian International holding Group Limited, a pharmaceutical and chemical products manufacturer, announced its IPO of 5 million ordinary shares at $5 per share on January 14. This is planned to raise about $25 million. The company’s focus is on the development, manufacture, marketing and sale of licorice products, oxytetracycline products, traditional Chinese medicine derivatives, heparin, sausage casing, and fertilizers. New filings include: Adagene– Only a week ago this China-based company announced it had discovered a new CAR-T candidate for renal cell carcinoma. It hopes to raise $125 million in the IPO. In January 2020, it raised $69 million in Series D, bringing the then-total up to $150 million. The compound was developed in the laboratory of Richard Childs, chief of the Laboratory of Transplantation Immunotherapy with the National Heart, Lung, and Blood Institute (NHLBI). The National Institutes of Health (NIH) is planning on taking over manufacturing and clinical development. Pharvaris – Based in The Netherlands, Pharvaris is planning a $100 million Nasdaq IPO to raise money for its therapy for hereditary angioedema (HAE). In November 2020, Pharvaris closed on an oversubscribed $80 million Series C round, bringing its total venture capital raised to more than $160 million. The company focuses on oral bradykinin-B2-receptor antagonists for HAE and other related indications. Its first drug is PHVS416 for HAE, with plans to initiate a Phase II trial this year. Neximmune – The company filed for an IPO to raise $86 million on January 19. The company is working on a new approach to immunotherapy that uses the body’s own T-cells to create specific, potent, and durable immune responses for cancer and other life-threatening immune-mediated disease. It has two drugs in Phase I/II trials: NEXI-001 for acute myeloid leukemia and NEXI-002 for multiple myeloma. It expects readouts by the end of this year. The company is based in Gaithersburg, Maryland. Biophytis – This French company filed today for a Nasdaq IPO to raise about $15 million. It plans to use the proceeds to finalize Part 2 of its COVA trial of Sarconeos (BIO101) in respiratory failures associated with COVID-19; to finalize its Phase II trial of Sarconeos in sarcopenia; to launch development of Sarconeos in Duchenne muscular dystrophy (DMD) once it receives IND approval from the FDA and European Medicines Agency; and to continuing working on its preclinical R&D program on retinopathies. Most Read Today