Announcement PDF OCTOBER 2023 PHASE III SHAREHOLDER WEBINAR www.avecho.com.au | ASX:AVE SAFE HARBOUR STATEMENT AVECHO BIOTECHNOLOGY This presentation, and any representations made before, during or after the presentation, may include forwardlooking statements that are inherently subject to risks and uncertainties. These statements relate to, but are not limited to: (1) the safety or efficacy of, or potential applications for, Avecho’s TPM® platform technology; (2) the strength of Avecho‘s intellectual property; (3) the timelines for Avecho’s clinical trials and regulatory processes for its different products; (4) the scalability and efficiency of manufacturing processes; (5) revenue projections, market share expectations, share price expectations and capital requirements. Actual results may differ from the expectations expressed in these forward-looking statements, and the differences may be material (whether positive or negative). The risks that may cause Avecho‘s actual results, performance or achievements to be materially different from those expressed or implied by such forward-looking statements, include but are not limited to: (1) risks inherent in the development, approval and commercialization of potential products; (2) uncertainty of clinical trial results or regulatory approvals or clearances; (3) changes to market trends or government laws or regulations; (4) the potential need for future capital; (5) dependence upon collaborators; and (6) protection of intellectual property rights, among others. Accordingly, you should not place undue reliance on these forward-looking statements. May 2022 AVECHO BIOTECHNOLOGY October 2023 2 2 AGENDA 1. Capital Raise 2. Phase III trial design & timeline 3. Recent third-party results; implications for Avecho’s trial May 2022 AVECHO BIOTECHNOLOGY October 2023 3 3 CAPITAL RAISE AVE Corporate Summary1 Entitlement Offer – $2M • Total shares (including T2) 3.17 Bn Total options (including T2)2 2.37 Bn Cash (end Q2 2023) A$2.86 M + T1 A$3.20 M 323M New Shares issued to existing shareholders, raising approximately $2M (May) Allowed Phase III manufacturing activities to commence • Shortfall Placement – $6M • Tranche 1 – 536M New Shares raising $3.2M (September) + T2 A$2.80 M • Tranche 2 – 471M New Shares raising $2.8M (November) Total cash A$8.86 M MCAP3 A$12.14M • EGM (9 November) for shareholder approval of Tranche 2 1 Assuming shareholder approval of all EGM resolutions 2 Various exercise price and expiry dates 3 As of 12th October 2023 May 2022 AVECHO BIOTECHNOLOGY October 2023 4 4 PHARMACEUTICAL CANNABIDIOL IS VALUABLE Only one pharmaceutical CBD product is approved by the FDA (Epidiolex®)1 • Epidiolex was developed by GW Pharma • Approved for rare childhood epilepsy conditions2 – rarely prescribed • GW Pharma was acquired for $7.2Bn USD by Jazz Pharma (2021) to obtain Epidiolex3 • It is anticipated that registered pharmaceutical CBD products for broader indications would be more valuable Avecho is targeting large indications such as insomnia for its pharmaceutical CBD product – large commercial opportunity Sources: 1. https://www.epidiolex.com/ 2. https://www.fda.gov/news-events/press-announcements/fda-approves-first-drug-comprised-active-ingredient-derived-marijuana-treat-rare-severe-forms 3. https://investor.jazzpharma.com/news-releases/news-release-details/jazz-pharmaceuticals-acquire-gw-pharmaceuticals-plc-creating May 2022 AVECHO BIOTECHNOLOGY October 2023 5 5 INSOMNIA IN AUSTRALIA – UNIQUE CBD OPPORTUNITY Insomnia can be broadly defined as difficulty initiating or maintaining sleep The TGA allows CBD products to be registered as over-thecounter (OTC) medicines1 for indications such as insomnia OTC medicines are available direct from a pharmacist without a prescription, a significant commercial advantage Australians spend $5B per year on OTC medicines2 No pharmaceutical CBD products are approved for sleep, but insomnia remains one of the most prevalent indications targeted globally by medical cannabis and consumer CBD products3 Avecho is well placed to be one of the first to achieve OTC TGA registration • 40% of Australians getting less sleep than they need • 59.4% Experience symptoms 3-4 times per week • Only 20% report their sleep is uninterrupted • Costs Australian economy $19.1 B per annum • Australian insomnia market ~$250M per annum • Global insomnia market >$4B per annum https://www.deloitte.com/au/en/services/economics/analysis/rise-try-to-shine.html Sources: 1. https://www.tga.gov.au/news/media-releases/over-counter-access-low-dose-cannabidiol 2. Medicines in the health system, Australian Institute of Health and Welfare (2022) 3. Suraev, A.S., et al.. Cannabinoid therapies in the management of sleep disorders: A systematic review of preclinical and clinical studies. Sleep Medicine Reviews 2020b (53); 101339. May 2022 AVECHO BIOTECHNOLOGY October 2023 6 6 SCIENTIFIC ADVISORS Assoc Professor Darren Mansfield Deputy Director, Monash Health − Director Sleep Service, Monash Health − Expertise across full range of sleep disorders, including insomnia − Significant experience in the conduct of large insomnia trials − Principal investigator for the Avecho study Assoc Professor Michael Perlis Assoc Prof Psychiatry, Behavioral Sleep Medicine Program, (Penn Uni) − Expert in insomnia and behavioral sleep medicine (BSM) clinical trials. − Editorial boards of Sleep, Sleep Research, Sleep Medicine Research and Behavioral Sleep Medicine − Past committee member; Sleep Research Society, American Academy of Sleep Medicine, Society of Behavioral Sleep Medicine May 2022 AVECHO BIOTECHNOLOGY October 2023 Professor Shantha Rajaratnam Deputy Director, Turner Institute for Brain and Mental Health − Academic Head of School of Psychological Sciences − Expert in the sleep-wake cycle and the study of novel treatments for sleep disorders in clinical trials. − Chair, Sleep Health Foundation; past-President Australasian Sleep Association Prof Sean Drummond Professor of Clinical Neuroscience (Monash Uni) − Director of Sleep and Circadian Research (Turner Institute for Brain and Mental Health) − Specialist in the cognitive neuroscience of sleep, the treatment of insomnia and wearable devices used to measure sleep in clinical trials. − Research funded by NIH, NHMRC, US Department of Defense and industry 7 7 PHASE III STUDY DESIGN Based upon study design from recently approved insomnia medications (Dayvigo, Quviviq) 2 weeks 2 weeks 8 weeks Treatment A – Placebo before bed Screening period Compliance Check Treatment B – 75 mg CBD before bed Follow-up Treatment C – 150 mg CBD before bed Daily sleep diary and ISI questionnaire. Subjects with poor do not enter the study Daily sleep diary to characterize SOL, WASO, Sleep duration. Subjects complete ISI questionnaire (and others) every two weeks. Five Clinical Trial Sites in 4 States Patient Numbers Interim Statistical Analysis − Victoria (Melbourne) − NSW (Western Sydney and Central Coast) − Queensland (Brisbane) − Western Australia (Perth) Total n=519 N=173 per group Conducted after ~210 patients Used to confirm an effect between groups (futility) and calculate additional patient numbers required for success May 2022 AVECHO BIOTECHNOLOGY October 2023 8 8 TIMELINES TO INTERIM ANALYSIS - MAJOR GO/NO GO 2023 Jan Feb Mar Apr May Jun Jul 2024 Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Funding Activities Manufacturing Activities Clinical supply Registration batches Stability Phase III Trial Results Interim Analysis Database build Patient recruitment Dosing patients Interim Analysis GO/NO GO Licensing discussions May 2022 AVECHO BIOTECHNOLOGY October 2023 9 9 THE DANGER OF THE PLACEBO RESPONSE • • • • A placebo effect is when a patient reports improvement in their condition after taking a pretend (placebo) medicine Finalised trial Trials with subjective endpoints (like design and insomnia) have high placebo effects timing will be theitsubject The placebo effect makes difficult toof a monitor a drug’s effect, minimizing the future chance of success in clinical trials communication in(left) the1 incoming Avecho went on record 2022, describing the risks tomonths the industry for upcoming CBD trials • In Q1 CY23, two Phase III trials examining CBD for insomnia announced their failure Sources: 1. https://www.cannabiz.com.au/avecho-chief-warns-of-placebo-dangers-as-firms-roll-out-cbd-clinical-trials/ May 2022 AVECHO BIOTECHNOLOGY October 2023 10 10 FIRST CLINICAL TRIAL RESULTS Sources: 1. https://www.cannabiz.com.au/blow-for-cann-group-as-over-the-counter-cbd-trial-fails-to-show-efficacy-for-sleep-disturbance/ 2. https://www.cannabiz.com.au/were-not-giving-up-says-new-cann-group-ceo-as-researchers-pore-over-clinical-trial-results/ 3. https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02622367-3A611160?access_token=83ff96335c2d45a094df02a206a39ff4 4. https://www.cannabiz.com.au/ecofibre-becomes-second-firm-to-confirm-disappointing-sleep-trial-results/ 5. https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02624508-2A1427262?access_token=83ff96335c2d45a094df02a206a39ff4 May 2022 AVECHO BIOTECHNOLOGY October 2023 11 11 MOST RECENT TRIAL RESULTS – BOD On 6 September 2023 BOD Science Limited (ASX:BOD) announced results of its study assessing CBD for insomnia. BOD tested two doses of CBD (50mg & 100mg) versus placebo in 208 patients over 8 weeks1 Primary endpoint failed, showing no improvement in insomnia (p<0.025) vs placebo with CBD in the intent to treat population1 Post-hoc analysis (per protocol population) showed improved sleep (p<0.05) for 100mg CBD versus placebo, but not 50mg CBD1 • CBD works for sleep at higher doses • Higher patient numbers are required to achieve statistical significance in the ITT population • Avecho’s study overcomes both these limitations • BOD’s trial result has de-risked Avecho’s study Sources: 1. https://bod.irmau.com/site/pdf/a8f90a8e-1ab4-401c-bf51-16894af17582/Schedule-3-CBD-trial-preliminary-results.pdf 2. https://clinicaltrials.gov/study/NCT05253417?spons=Bod%20Australia&aggFilters=funderType:industry&rank=1 May 2022 BOD 2 Avecho CBD Dose 50mg CBD and 100mg CBD 75mg CBD and 150mg CBD (with increased absorption) Controls to minimise placebo effect No Yes Interim analysis for repowering No Yes Patient Numbers Insomnia measurement KEY TAKEAWAYS AVECHO BIOTECHNOLOGY Trial Parameters October 2023 Minimum Inclusion criteria (ISI) Finalised trial design and 208 519 timing will be a Insomnia Severitythe subject ISI and sleepof efficiency Index (ISI) future (SE) communication ISI score of 8 in the coming ISI score of 15 months 12 12 THE OPPORTUNITY OPEN FOR AVECHO • After four Australian companies pursued Phase IIb/III clinicals in insomnia targeting TGA registration, three have completed trials and failed to meet their primary endpoint Finalised trial design and Avecho has significantly more drug development and clinical trial expertise than its peers in the timing will be Australian sector. the subject of a Avecho’s insomnia Phase III is significantly larger and more rigorous, maximizing the chance of a future successful outcome. communication in the coming Recent clinical results have validated all Avecho’s trial design decisions and de-risked the study months This leaves Avecho as the last company of the initial group in active clinical development • • • • Avecho is well placed to have one of the first CBD products approved with the TGA • Without competitive products in the space, interested licensees will all need to deal with Avecho May 2022 AVECHO BIOTECHNOLOGY October 2023 13 13 Register interest in participating in our Phase III insomnia study at the following link; Questions welcome via our InvestorHub platform. cbdinsomniastudy.com