MT-6402

Monotherapy activity of long duration in patients who have progressed on checkpoint therapy via a novel immuno-oncology mechanism of action with PD-L1 ETB (MT-6402) programEarly indication of monotherapy activity in CTLA-4 ETB (MT-8421) program through T-reg depletion; no drug-related adverse events > grade 2Novel mechanism of action targeting CD38+ immune cells of B-cell, T-cell, and monocytic lineage representing enhanced potency in I&I without the need for conditioning therapy AUSTIN, Texas, Aug. 14, 2024 (GLOBE NEWSWIRE) -- Molecular Templates, Inc. (Nasdaq: MTEM, “Molecular Templates,” or “MTEM”), a clinical-stage biopharmaceutical company focused on the discovery and development of proprietary targeted biologic therapeutics, engineered toxin bodies (“ETBs”), to create novel therapies with potent differentiated mechanisms of action, today reported financial results and business updates for the second quarter of 2024. “ETBs can eliminate immune cells that monoclonal antibodies cannot. Eliminating MDSCs with MT-6402 and Tregs with MT-8421 is a novel approach to immuno-oncology that is demonstrating durable responses in patients who have progressed or were refractory to checkpoint therapy. The elimination of immunosuppressive cells in patients with tumor microenvironments that promote immune evasion may drive long-lasting responses in patients who have exhausted other treatment options,” said Eric Poma, PhD., Chief Executive and Chief Scientific Officer of MTEM. “Similarly, we believe MT-0169 can eliminate CD38+ immune cells that antibodies cannot, allowing for potentially greater potency in both hematologic malignancies and autoimmune diseases.” Recent Company Highlights MT-6402: Continued monotherapy activity in patients who progressed or were refractory to checkpoint therapyNine patients (seven evaluable) with low PD-L1+ HNSCC were dosed in the MT-6402 phase I dose escalation study. Two patients remain in partial responses at cycle 23 and cycle 14 (one cycle is 4 weeks). Both patients had progressed after multiple lines of checkpoint therapy. In the high PD-L1+ dose expansion cohort, four NSCLC patients (three evaluable) have been enrolled. and one patient is in a partial response at cycle 11; the patient had progressed on chemotherapy, targeted therapy, and checkpoint therapy. All responding patients were heavily pretreated (3 or more lines of previous therapy including checkpoint) and have been on MT-6402 longer than any other previous therapy. MTEM continues to enroll HNSCC patients with low PD-L1 expression (1-49%) and patients with solid tumors with high PD-L1 expression (≥50%). MT-8421: Enrollment in Phase 1 dose escalation ongoing with continued observation of unique pharmacodynamic profile (peripheral and TME Treg depletion) and signs of monotherapy activityFive melanoma patients were evaluable in the first two dose cohorts (32 and 48 mcg/kg); no drug related adverse events > grade 2 were observed. One patient remains on study in cycle 11 with a 27% decrease in tumor volume and reduction in circulating tumor DNA from 3.13 to 0 MTM/mL. This patient had a >90% reduction in peripheral Tregs and a ~66% reduction of Tregs in the TME. The patient had progressed on pembrolizumab in the adjuvant setting and then progressed on ipilimumab (4 doses at 3mg/kg) and nivolumab in the metastatic setting. MT-0169: Potential in severe autoimmune diseases being explored based on clinical demonstration of complete elimination of CD38+ immune cells at dose levels with no drug-related adverse events > grade 2. The potent and unique mechanism of action of MT-0169 is not subject to resistance mechanisms associated with monoclonal antibodies like trogocytosis and can eliminate high-expressing CD38 immune cells like plasma cells as well as low-expressing CD38+ cells like HLA-DR CD38+ T-cells. This mechanism of action does not require conditioning therapy. MTEM will continue to develop MT-0169 in hematologic malignancies and is evaluating the potential of MT-0169 in severe immune-mediated diseases. Upcoming Milestones for 2H 2024 Additional updates from the MT-6402 low PD-L1+ HNSCC and high PD-L1+ solid tumor expansions studies in 3Q24.Additional updates from the MT-8421 dose escalation study in 3Q24.MT-0169 Phase 1 study initiation in CD38+ hematological malignancies and continued evaluation in autoimmune disease. Upcoming Conferences MTEM will participate at the H.C. Wainwright 26th Annual Global Investment Conference taking place at the New York Lotte Palace Hotel, September 9 – 11, 2024. An on-demand presentation will be accessible virtually starting 7:00am ET September 9, 2024 via MTEM corporate website. One-on-one meetings may be scheduled by directly contacting MTEM. Second Quarter 2024 Financial Results The net loss attributable to common shareholders for the second quarter of 2024 was $8.1 million, or $1.23 per basic and diluted share. This compares with a net loss attributable to common shareholders of $10.9 million, or $2.89 per basic and diluted share, for the same period in 2023. Revenues for the second quarter of 2024 were $0.6 million, compared to $6.9 million for the same period in 2023. Total research and development expenses for the second quarter of 2024 were $5.4 million, compared with $13.4 million for the same period in 2023. Total general and administrative expenses for the second quarter of 2024 were $3.5 million, compared with $5.2 million for the same period in 2023. As of June 30, 2024, MTEM’s cash and cash equivalents totaled $9.7 million. The Company expects that its cash and cash equivalents for the quarter ended June 30, 2024 will support its ongoing operations into the fourth quarter of 2024. Molecular Templates, Inc.CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(in thousands, except share and per share data)(unaudited) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023Research and development revenue $189 $6,627 $11,113 $40,254 Grant revenue 383 238 545 3,240 Total revenue 572 6,865 11,658 43,494 Operating expenses: Research and development 5,402 13,413 12,807 32,455 General and administrative 3,466 5,195 7,197 10,997 Total operating expenses 8,868 18,608 20,004 43,452 Income/(loss) from operations (8,296) (11,743) (8,346) 42 Interest and other income, net 130 365 239 820 Interest and other expense, net (38) (1,189) (69) (2,584)Gain on extinguishment of debt — 1,795 — 1,795 Change in valuation of contingent value right 107 303 651 303 Loss on disposal of property and equipment — (399) — (399)Net loss attributable to common stockholders $(8,097) $(10,868) $(7,525) $(23)Net loss per share attributable to common stockholders: Basic and diluted $(1.23) $(2.89) $(1.26) $(0.01)Weighted average number of shares used in net loss per share calculations: Basic and diluted 6,557,295 3,756,711 5,965,781 3,756,711 Molecular Templates, Inc.CONDENSED CONSOLIDATED BALANCE SHEETS(in thousands, except share and per share data) June 30,2024(unaudited) December 31,2023ASSETS Current assets: Cash and cash equivalents $9,657 $11,523 Prepaid expenses 787 2,195 Grants revenue receivable 795 250 Other current assets 777 2,804 Total current assets 12,016 16,772 Operating lease right-of-use assets 8,124 9,161 Property and equipment, net 5,238 7,393 Other assets 1,319 2,057 Total assets $26,697 $35,383 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $2,773 $1,523 Accrued liabilities 2,270 4,279 Deferred revenue, current — 9,031 Other current liabilities 2,637 2,488 Total current liabilities 7,680 17,321 Operating lease liabilities, long term portion 8,390 9,742 Contingent value right liability 2,051 2,702 Other liabilities 1,465 1,406 Total liabilities 19,586 31,171 Commitments and contingencies Stockholders’ equity Preferred stock, $0.001 par value per share: Authorized: 2,000,000 shares as of June 30, 2024 and December 31, 2023; Issued and outstanding: 250 shares as of June 30, 2024 and December 31, 2023 — — Common stock, $0.001 par value per share: Authorized: 150,000,000 shares as of June 30, 2024 and December 31, 2023; Issued and outstanding: 6,583,880 and 5,374,268 shares as of June 30, 2024 and December 31, 2023, respectively 7 5 Additional paid-in capital 467,521 457,099 Accumulated deficit (460,417) (452,892)Total stockholders’ equity 7,111 4,212 Total liabilities and stockholders’ equity $26,697 $35,383 Second tranche of July 2023 Private Placement We closed the second tranche of the July 2023 Private Placement on April 2, 2024 with gross proceeds of approximately $9.5M. The Company intends to use the net proceeds from the second tranche to fund its ongoing clinical studies, working capital and for general corporate purposes. About Molecular Templates Molecular Templates is a clinical-stage biopharmaceutical company focused on the discovery and development of next-generation ADCs. Our drug platform technology, known as Engineered Toxin Bodies (ETBs), leverages the resident biology of a genetically engineered toxin payload to create novel therapies with potent and differentiated mechanisms of action for cancer and various disease indications. Forward-Looking Statements This press release contains forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995 (the “Act”). Molecular Templates disclaims any intent or obligation to update these forward-looking statements and claims the protection of the Act’s Safe Harbor for forward-looking statements. All statements, other than statements of historical facts, included in this press release, including, but not limited to those regarding strategy, future operations, the Company’s ability to execute on its objectives, prospects, plans, future clinical development of the Company’s product candidates, any implication that the preliminary results, interim results, or the results of earlier clinical trials or ongoing clinical trials will be representative of the results of future or later clinical trials or final results, the potential benefits, safety or efficacy and any evaluations or judgments regarding the Company’s product candidates, and future execution of corporate goals. In addition, when or if used in this press release, the words “may,” “could,” “should,” “continue”, “anticipate,” “potential”, “believe,” “estimate,” “appears”, “expect,” “intend,” “plan,” “predict” and similar expressions and their variants, as they relate to Molecular Templates may identify forward-looking statements. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties. Actual events or results may differ materially from those discussed in the forward-looking statements as a result of various factors including, but not limited to the following: the continued availability of financing on commercially reasonable terms, whether Molecular Templates’ cash resources will be sufficient to fund its continuing operations; the results of MTEM’s ongoing clinical studies and the ability to effectively operate MTEM, and those risks identified under the heading “Risk Factors” in Molecular Templates’ filings with the Securities and Exchange Commission (the “SEC”), including its Form 10-Q for the second quarter year ended June 31, 2024 and any subsequent reports filed with the SEC. Any forward-looking statements contained in this press release speak only as of the date hereof, and Molecular Templates specifically disclaims any obligation to update any forward-looking statement, whether because of new information, future events or otherwise. Contacts:Grace Kimgrace.kim@mtem.com

Continued monotherapy activity in solid tumors with MT-6402 (PD-L1-targeting ETB) in checkpoint-experienced patients.Early pre-clinical and clinical data demonstrate the potential of MT-0169 (CD38-targeting ETB) in severe immune-mediated diseases. AUSTIN, Texas, June 03, 2024 (GLOBE NEWSWIRE) -- Molecular Templates, Inc. (Nasdaq: MTEM, “Molecular Templates,” or “MTEM”), a clinical-stage company focused on the discovery and development of targeted biologic therapeutics with unique mechanisms of action (engineered toxin bodies or “ETBs”) for cancer and immune-mediated disease, today provided an update on its clinical-stage programs. Eric Poma, PhD., Chief Executive and Chief Scientific Officer of MTEM, stated, “ETBs are a potentially powerful therapeutic approach to selectively depleting immunosuppressive cells in oncology or eliminating self-reacting immune cells in severe immune-mediated diseases. The monotherapy activity we see with MT-6402 in relapsed/refractory solid tumor patients, and the clinical and ex vivo depletion of CD38+ immune cells seen with MT-0169 at well-tolerated doses underscore the potential of this platform across multiple diseases.” Company Pipeline Highlights MT-6402 (PD-L1-targeting ETB) Promising Single-Agent Activity: MT-6402 has shown monotherapy activity in heavily pre-treated patients who had previously progressed or were refractory to immuno-oncology therapy.Head and Neck Cancer Responses: MTEM had previously reported that nine patients (seven evaluable) with head and neck squamous cell carcinoma (“HNSCC”) had been treated in the Phase 1 dose escalation. Two heavily pre-treated patients with low PD-L1 expressing squamous cell carcinoma of the head and neck (HNSCC) had achieved partial responses with MT-6402 monotherapy. These patients remain in response and in good clinical condition, continuing treatment in cycles 21 and 12 (one cycle = 4 weeks), respectively. In addition, four of the HNSCC patients treated with MT-6402 had stable disease with two showing tumor reduction. All patients with tumor responses or tumor reduction had low PD-L1 expression (≤20% CPS).New Lung Cancer Response: An unconfirmed partial response was observed in a non-small cell lung cancer (“NSCLC”) patient with high PD-L1 expression in the Phase 1b monotherapy dose expansion study in solid tumor patients with high PD-L1 tumor expression (TPS≥50%). The patient achieved a partial response at the end of cycle 8 following sustained tumor reduction in prior assessments. A PET scan in cycle 8 showed no indications of active metastatic disease. This patient had previously progressed on chemotherapy, targeted therapy, and checkpoint therapy, including progression within six months on pembrolizumab + ramucirumab, before enrolling in the study. Three other NSCLC patients with high PD-L1 expression have been dosed in the Phase 1b expansion study. Two of these patients had progressive disease and one passed away from COVID and was not evaluable.Favorable Safety Profile: To date, MT-6402 appears to be generally well-tolerated, with no drug-related adverse events exceeding grade 3.Ongoing Enrollment: MTEM continues to enroll HNSCC patients with low PD-L1 expression (1-49%) and patients with solid tumors with high PD-L1 expression (≥50%). MT-0169 (CD38-targeting ETB) Clinical proof-of-concept supports the elimination of CD38+ cells in immune-mediated disease. Recent clinical data with CD38 antibodies have demonstrated the therapeutic potential of CD38+ immune cell clearance in several immune-mediated diseases. Despite these promising early data, a more potent mechanism of CD38+ immune cell depletion may provide greater clinical benefit.Potent and unique mechanism of action. MT-0169 is designed to destroy CD38+ tumor or immune cells through internalization of CD38 and cell destruction via a novel mechanism of action (enzymatic ribosomal destruction and ER stress). In ex vivo cell kill assays, MT-0169 shows potency against plasma cells with IC50 activity in the picomolar or femtomolar range. Plasma cells are exceptionally sensitive to ER stress, making them uniquely susceptible to the MT-0169 mechanism of action. MT-0169 also shows potent activity against T-cells that express low levels of CD38. HLA-DR CD38+ T-cells have been implicated in many immune-mediated diseases.Overcoming antibody resistance. The unique mechanism of action of MT-0169 and its lack of an Fc domain may avoid resistance mechanisms seen with CD38 antibodies like receptor downregulation or trogocytosis while allowing for combination approaches with FcRn-targeting therapies.Clinical proof-of-concept with MT-0169. MTEM’s Phase 1 study in patients with relapsed or refractory multiple myeloma dosed at 5, 10, or 15 mcg/kg showed potent depletion of CD38+ immune cells with no drug-related adverse events of grade 3 or higher noted in these patients.Planned clinical development with MT-0169. MTEM will continue to develop MT-0169 in hematology and is evaluating the potential of MT-0169 in severe immune-mediated diseases. MT-8421 (CTLA-4 ETB) Tumor microenvironment dismantling. MT-8421 is designed to potently destroy CTLA4+ Tregs, alleviating immunosuppression in the tumor microenvironment.Pharmacodynamic effects observed early Phase 1 dose escalation. Three patients were dosed in the first cohort of the Phase 1 study at 32 mcg/kg. No drug-related adverse events of grade 3 or higher were observed. One patient had disease progression at the end of cycle 2. Two patients have stable disease and remain on study at cycle 8 and cycle 7, respectively (one cycle = four weeks). The two patients in stable disease showed peripheral depletion of Tregs and significant elevations in IL-2 while on therapy. One of the patients has a notable decrease in ctDNA.Dose escalation continues. Enrollment is on-going in the second cohort of 48 mcg/kg for the Phase 1 study of MT-8421. About Molecular Templates Molecular Templates is a clinical-stage biopharmaceutical company focused on the discovery and development of targeted biologic therapeutics. Our proprietary drug platform technology, known as engineered toxin bodies, or ETBs, leverages the resident biology of a genetically engineered form of Shiga-like Toxin A subunit to create novel therapies with potent and differentiated mechanisms of action for cancer and immune-mediated diseases. Forward-Looking Statements This press release contains forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995 (the “Act”). Molecular Templates disclaims any intent or obligation to update these forward-looking statements and claims the protection of the Act’s Safe Harbor for forward-looking statements. All statements, other than statements of historical facts, included in this press release, including, but not limited to those regarding strategy, future operations, the Company’s ability to execute on its objectives, prospects, plans, future clinical development of the Company’s product candidates, any implication that the preliminary results, interim results, or the results of earlier clinical trials or ongoing clinical trials will be representative of the results of future or later clinical trials or final results, the potential benefits, safety or efficacy and any evaluations or judgements regarding the Company’s product candidates, , and future execution of corporate goals. In addition, when or if used in this press release, the words “may,” “could,” “should,” “continue”, “anticipate,” “potential”, “believe,” “estimate,” “appears”, “expect,” “intend,” “plan,” “predict” and similar expressions and their variants, as they relate to Molecular Templates may identify forward-looking statements. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties. Actual events or results may differ materially from those discussed in the forward-looking statements as a result of various factors including, but not limited to the following: the continued availability of financing on commercially reasonable terms, whether Molecular Templates’ cash resources will be sufficient to fund its continuing operations; the results of MTEM’s ongoing clinical studies, the ability to effectively operate MTEM and retain key employees post-MTEM’s previously announced reduction in force, the ability of MTEM to maintain the continued listing of its common stock on Nasdaq, and those risks identified under the heading “Risk Factors” in Molecular Templates’ filings with the Securities and Exchange Commission (the “SEC”), including its Quarterly Report on Form 10-Q for the quarter ended March 31, 2024 and any subsequent reports filed with the SEC. Any forward-looking statements contained in this press release speak only as of the date hereof, and Molecular Templates specifically disclaims any obligation to update any forward-looking statement, whether because of new information, future events or otherwise. Contacts:Grace Kimgrace.kim@mtem.com