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4SC AG resolves to issue new shares to continue to advance its drug development programs for resminostat, 4SC-202 and 4SC-208

Planegg-Martinsried, Germany, 12 June 2017 – The Management Board of 4SC AG (4SC, FSE Prime Standard: VSC) today resolved with the approval of the Supervisory Board to conduct a capital increase to raise funds to continue to advance its drug development programs for resminostat, 4SC-202 and 4SC-208. Toward this end, 4SC is planning a cash capital increase by way of a rights offering for existing shareholders. A total of up to approximately 16.4 million new shares will be offered for subscription. Any new shares not subscribed for will be offered for sale to institutional investors in Europe and internationally (together the “Offering”).

Capital increase by way of a rights offering

4SC has resolved to increase its share capital through the utilization of authorized capital from EUR 18,966,646.00, composed of 18,966,646 no-par value bearer shares, by up to EUR 16,350,556.00 to a maximum of EUR 35,317,202.00, by issuing up to 16,350,556 new no-par value bearer shares, each with a notional par value of EUR 1.00, in return for cash contributions. The new shares (the “Offer Shares”) will be offered to the existing shareholders through indirect pre-emptive rights by quirin bank AG, Berlin (Germany). The subscription ratio will be 29:25, which means 29 existing shares entitle the holder to subscribe for 25 new shares. There shall be no organized trading in subscription rights. The subscription period is scheduled to begin on 16 June 2017 and end on 3 July 2017 at noon (12:00 hrs. CEST).

The subscription price per new share is expected to be determined on 28 June 2017, taking into account the volume-weighted average price (VWAP) of 4SC AG in the XETRA electronic trading system on the Frankfurt Stock Exchange from the beginning of the subscription period on 16 June 2017 until the close of trading on 27 June 2017, less any potential discount yet to be determined, but in any case the subscription price will not exceed EUR 4.00. Any new shares not subscribed for in the offering will be offered for sale to institutional investors in Europe and internationally after the end of the subscription period. 4SC aims to raise total gross proceeds of between EUR 44 and 56 million from the cash capital increase.

Rights Offering and Securities Prospectus

Additional details concerning the cash capital increase are available in the Rights Offering, which is expected to be published in the Federal Gazette on 13 June 2017 and will also be accessible on the website of 4SC at www.4SC.com from that day forward. The public offering of shares from the cash capital increase and the admission of the new shares from the capital increase to trading on the Regulated Market (Prime Standard Market) of the Frankfurt Stock Exchange are being conducted based on a securities prospectus which was approved by the German Federal Financial Supervisory Authority (BaFin) today, on 12 June 2017. The prospectus is accessible on the website of 4SC AG at www.4SC.com.

 

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Information and Explanation of the Issuer to this News:

 

About resminostat

Resminostat is orally administered and potentially offers a novel approach to treating a wide variety of cancers, both as monotherapy and in combination therapy with other anti-cancer drugs. Resminostat inhibits tumor growth and proliferation, causes tumor regression, and strengthens the body’s own immune response to cancer.

Resminostat has been shown to be well tolerated in patients with advanced cancers in Phase I studies. Its use in the treatment of cutaneous T-cell lymphoma (CTCL), Hodgkin’s lymphoma and liver, lung, colon, pancreatic and biliary tract cancers has been and is being investigated in further clinical studies. Initial positive efficacy results for resminostat in monotherapy were observed in patients with Hodgkin’s lymphoma and in combination with sorafenib in selected patients with advanced liver cancer (hepatocellular cancer, HCC).

 

About 4SC-202

4SC-202 is an orally administered small molecule for the treatment of cancer with a unique mode of action that inhibits both class I histone deacetylase proteins and the lysine-specific demethylase protein, which play significant roles in the regulation of signaling pathways in cancer cells.

4SC-202 has been investigated in a Phase I study with 24 mostly heavily pretreated patients with several types of highly advanced hematologic cancers, and has proven to be tolerated. Positive signs of anti-tumor efficacy were observed with one complete remission for 28 months and one partial responder for 8 months.

Data from preclinical investigations demonstrated that 4SC-202 strengthens the anti-tumor immune response, alters the tumor microenvironment and increases infiltration of immune cells into the tumor. Further preclinical investigations showed that the combination of 4SC-202 with checkpoint inhibitors resulted in better anti-tumor activity than treatment with checkpoint inhibitors alone, suggesting a very promising clinical development path for 4SC-202 in both refractory and non-responding patients to treatment with checkpoint inhibitors.

 

About 4SC-208

Data from several preclinical in vivo models has established the efficacy of 4SC-208 in inhibiting the Hedgehog/GLI signaling. Inhibition of this signaling pathway has emerged as a highly effective strategy in obstructing the tumorigenic capacity of cancer stem cells, as well as tumor development, proliferation and survival.

Inhibitors of Hedgehog signaling target the pathway upstream of the transcription factor GLI, whereas 4SC-208 inhibits at the level of GLI and is thus potentially able to avoid the tumor recurrence and relapse observed in response to currently available inhibitors.

4SC believes that 4SC-208 is a promising drug candidate and expects it to complete formal preclinical testing in 2018 and to enter into a Phase I/II clinical study immediately thereafter. Cancer indications that are particularly promising are those where resistance to therapies targeting the Hedgehog/GLI pathway are emerging, such as in basal cell carcinoma.

 

About 4SC

4SC AG is a clinical-stage biopharmaceutical company developing small-molecule drugs that can target key indications in cancer with high unmet medical needs. Such drugs are intended to provide patients with innovative treatment options that are more tolerable and efficacious than existing therapies and provide a better quality of life. 4SC’s core assets include resminostat, 4SC-202 and 4SC-208.

4SC’s pipeline is protected by a comprehensive portfolio of patents and comprises promising products that are in various stages of preclinical and clinical development. 4SC’s aim is to generate future growth and enhance its enterprise value by entering into partnerships with pharmaceutical and biotech companies and/or the eventual marketing and sales of approved drugs in select territories by 4SC itself. Founded in 1997, 4SC had 48 employees as of 31 March 2017. 4SC has been listed on the Prime Standard of the Frankfurt Stock Exchange since December 2005.

 

Forward-looking information

Information set forth in this press release contains forward-looking statements, which involve risks and uncertainties. The forward-looking statements contained herein represent the judgement of 4SC as of the date of this press release. Such forward-looking statements are neither promises nor guarantees, but are subject to a variety of risks and uncertainties, many of which are beyond 4SC’s control, and which could cause actual results to differ materially from those contemplated in these forward-looking statements. 4SC expressly disclaims any obligation or undertaking to release any updates or revisions to any such statements to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based.

 

Disclaimer

This publication constitutes neither an offer to sell nor a solicitation to buy securities. The offer is being made solely by means of, and on the basis of, the published prospectus (including any amendments thereto, if any). An investment decision regarding the publicly offered securities of 4SC AG should only be made on the basis of the securities prospectus. The prospectus is available free of charge from 4SC AG (Fraunhoferstrasse 22, 82152 Planegg-Martinsried, Germany; phone: +49 89 700763-0; fax: +49 89 700763-29; and on the website of 4SC AG (www.4SC.com)).

These materials are for informational purposes only and are not intended to constitute, and should not be construed as, an offer to sell or subscribe for, or the announcement of a forthcoming offer to sell or subscribe for, or a solicitation of any offer to buy or subscribe for, or the announcement of a forthcoming solicitation of any offer to buy or subscribe for, ordinary shares in the share capital of 4SC AG (the “Company“, and such shares, the “Shares“) in the United States or in any other jurisdiction.

The Shares have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act“) and may not be offered or sold within the United States absent registration or an exemption from the registration requirements under the Securities Act. The Company does not intend to register any portion of the offering in the United States or to conduct a public offering of Shares in the United States.

The Company has not authorized any offer to the public of Shares in any Member State of the European Economic Area, except in the Federal Republic of Germany and Luxembourg. With respect to any Member State of the European Economic Area which has implemented the Prospectus Directive other than Germany and Luxembourg (each a “Relevant Member State“), no action has been undertaken or will be undertaken to make an offer to the public of Shares requiring publication of a prospectus in any Relevant Member State. As a result, the Shares may only be offered in Relevant Member States:

(i)         to any legal entity which is a “qualified investor” as defined in the Prospectus Directive; or

(ii)        in any other circumstances falling within Article 3(2) of the Prospectus Directive.

For the purpose of this paragraph, the expression “offer of securities to the public” means the communication in any form and by any means of sufficient information on the terms of the offer and the Shares to be offered so as to enable the investor to decide to exercise, purchase or subscribe for the Shares, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State and the expression “Prospectus Directive” means Directive 2003/71/EC (as amended, including by Directive 2010/73/EU), and includes any relevant implementing measure in the Relevant Member State.

Any such investor will also be deemed to have represented and agreed that any Shares acquired by it in the contemplated offering of Shares have not been acquired on behalf of persons other than such investor. This announcement is not an advertisement within the meaning of the Prospectus Directive and does not constitute a prospectus.

In the United Kingdom, this document and any other materials in relation to the Shares is only being distributed to, and is only directed at, and any investment or investment activity to which this document relates is available only to, and will be engaged in only with, “qualified investors” (as defined in section 86(7) of the Financial Services and Markets Act 2000) and who are (i) persons having professional experience in matters relating to investments who fall within the definition of “investment professionals” in Article 19(5) of the Financial Services and Markets Act 2000 (“Financial Promotion“) Order 2005 (the “Order”); or (ii) high net worth entities falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant persons“). This communication is directed only at relevant persons. Persons who are not relevant persons should not take any action on the basis of this document and should not act or rely on it. Any investment activity to which this communication relates will only be available to and will only be engaged with, relevant persons. No action has been taken by the Company that would permit an offer of Shares or the possession or distribution of these materials or any other offering or publicity material relating to such Shares in any jurisdiction, except for the Republic of Germany and Luxembourg, where action for that purpose is required.

This document may contain forward-looking statements. These statements are based on the current views, expectations and assumptions of the management of the Company and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. Actual results, performance or events may differ materially from those described in such statements due to, among other things, changes in the general economic and competitive environment, risks associated with capital markets, currency exchange rate fluctuations and competition from other companies, changes in international and national laws and regulations, in particular with respect to tax laws and regulations, affecting the Company and other factors. The Company does not assume any obligations to update any forward- looking statements.

Neither these materials nor any copy of it may be taken or transmitted, directly or indirectly, into the United States, Australia, Canada, Japan or the South Africa. These materials do not constitute or form part of any offer or invitation to sell, or any solicitation of any offer to purchase or subscribe nor shall it (or any part of it) or the fact of its distribution, form the basis of, or be relied on in connection with, any contract therefore. The offer and the distribution of these materials and other information in connection with the listing and offer in certain jurisdictions may be restricted by law.

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