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Hua Medicine Announces 2018 Annual Results

– 2019-03-08

8 March, 2019 - Hong Kong

Hua Medicine (the “Company”, Stock Code: 2552.HK) today announced its consolidated results for the year ended December 31, 2018 (the “Review Period”). As of December 31, 2018, the Company’s cash position was approximately RMB 1,443.3 million. For the fiscal year 2018, the Company advanced its two Phase III trials for Dorzagliatin in China according to plan, and successfully raised an aggregate financing of US$231 million. Total expenditures incurred by the Company for the Review Period was approximately RMB411.9 million, of which approximately RMB269.1 million was attributable to R&D expenses.

During the Review Period, Hua Medicine research and development expenses increased by approximately RMB143.7 million or approximately 114.7% to approximately RMB269.1 million. Adjusting for share-based compensation and loss on changes in fair value of financial liabilities at fair value through profit or loss (FVTPL), the Company’s loss increased by approximately RMB129.4 million or approximately 86.3% to approximately RMB279.3 million. Loss on changes in fair value of financial liabilities at FVTPL is a non-cash accounting charge that the Company will no longer accrue after its successful HK IPO in September 2018, as all of its convertible shares outstanding were converted into ordinary shares at such time.

The results from the Company’s Phase II trials for Dorzagliatin in China were published in the May 2018 edition of The Lancet Diabetes & Endocrinology. The Company also published the results of its Phase Ic personalized medicine trial, demonstrating effective glycemic control in Type 2 diabetes patients when using its proprietary biomarker-guided patient selection approach in the April 2018 edition of Diabetes, Obesity and Metabolism. The Company successfully advanced its two Phase III trials for Dorzagliatin in China, with total randomized enrollment of 752 patients as of December 2018. The enrollment for its monotherapy Phase III trial (HMM0301) was completed on February 28, 2019, and enrollment for its combination with metformin Phase III trial (HMM0302) reached 489 patients as of February 28, 2019.

Aggregate financing of US$231 million was successfully raised in 2018, with US$117 million raised in a pre-IPO equity financing in March 2018 and HK$892 million (approximately US$114 million) raised in an IPO on the Hong Kong Stock Exchange in September 2018.

Looking forward, Hua Medicine expects to complete patient enrollment for both of its Phase III trials by the middle of calendar year 2019, announce top-line Phase III trial results for its monotherapy trial (HMM0301) by the fourth quarter of 2019, announce top-line Phase III results for its combination with metformin trial (HMM0302) by the first quarter of 2020, file for new drug application (NDA) approval on a rolling basis with the National Medical Products Association (“NMPA”) shortly thereafter, and obtain NMPA approval by the end of 2020 or the first half of 2021. Upon receipt of positive Phase III data, the Company plans to partner with international pharmaceutical companies to make Dorzagliatin available to patients outside of China. The Company is also developing mGLUR5, a potential novel drug candidate for the treatment of Parkinson’s disease levodopa-induced dyskinesia, or PD-LID. The Company continues to conduct pre-clinical studies on its mGLUR5 program for levodopa-induced dyskinesia in Parkinson disease patients. Based on the results of these studies, the Company plans to make a go / no go decision later in 2020.

“2018 has been an extraordinary year for Hua Medicine,” said Dr. Li Chen, Chief Executive Officer of Hua Medicine. “Our mission at Hua Medicine has always been to focus on innovative, first-in-class medicines that address unmet needs globally, and we continue to make major advances with our main drug candidate, Dorzagliatin (HMS5552). In addition to making significant progress in our registration trials, we have also accomplished other significant milestones in preparation for our NDA filing, such as validation of our commercial manufacturing process, and completing other relevant pre-clinical and clinical trials. For 2019, we have already activated two Phase I trial sites in the United States to expand the indications for Dorzagliatin globally, targeting DPP-4 and SGLT-2 combination users. We achieved first patient dosing for our DPP-4 (sitagliptin) trial (HMM0111) in January 2019. On January 23, 2019, the China National Intellectual Property Administration issued to the Company a patent on a controlled release formulation of Dorzagliatin, that extends the patent exclusivity of Dorzagliatin to 2037 in China. And in February 2019, we were honored to have Dr. Ralph DeFronzo join the Company as our Global Consultant. Dr. DeFronzo has contributed to several significant milestones in diabetes, including leading the U.S. development and approval of both metformin and SGLT-2. For the remainder of 2019, we remain completely focused on completing our 2 registration Phase III trials in China and to finalize all of the required preparatory work needed to submit our NDA submission with the NMPA by 2020 and to secure approval in China by end of 2020 or early 2021.”

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About Hua Medicine
Hua Medicine is a pre-revenue China-based drug development company currently focused on developing Dorzagliatin, a first-in-class oral drug for the treatment of Type 2 diabetes which has entered into NDA enabling stage. Founded by an experienced group of entrepreneurs and international investment firms, Hua is currently in 2 Phase III registration trials in China. The Company also has initiated product life-cycle management studies of this novel diabetes drug, and advanced the knowledge in personalized diabetes care. Hua's strategy is to leverage the cost-efficient and high-quality drug development capabilities available in China, while working very closely with disease experts and regulatory agencies in China and rest of the world to advance diabetes care solutions for global patients.

This press release is issued by Wonderful Sky Financial Group Limited on behalf of Hua Medicine.

For further information, please contact:
Hua Medicine
Emily Yeh

Wonderful Sky Financial Group Limited
Ketrina Yang / Grace Chan
Tel: (852) 3970 2171 / 3970 2218
Fax: (852) 3102 0210

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