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Press release

Epigenomics AG announces 2017 First Quarter Financial Results

Berlin (Germany) and Germantown, MD (U.S.A.), May 10, 2017 – Epigenomics AG (FSE: ECX, OTCQX: EPGNY), or the “Company”, today announced its financial results for the first quarter 2017 ended March 31.

Q1/2017 Financial results

– Total revenue slightly decreased to EUR 281 thousand (Q1 2016: EUR 295 thousand) mainly due to the termination of a licensing agreement for the sale of sample preparation kits.

– Operating costs in Q1 2017 decreased significantly to EUR 3.1 million (Q1 2016: EUR 5.3 million). In the comparison period, operating costs were impacted by non-cash expenses for share-based compensation.

– Operating loss (EBIT) for Q1 2017 decreased to EUR -2.7 million (Q1 2016: EUR -4.6 million). EBITDA before expenses for share-based compensation decreased to EUR -2.4 million (Q1 2016: EUR -2.2 million).

– Net loss for Q1 2017 decreased to EUR -2.4 million (Q1 2016: EUR -4.3 million). Loss per share for Q1 2017 decreased to EUR -0.10 (Q1 2016: EUR -0.23).

– Cash consumption in Q1 2017 decreased to EUR 1.6 million (Q1 2016: EUR 2.4 million).

– The Company’s liquidity (cash, cash equivalents and marketable securities) at the reporting date was EUR 10.7 million (Dec 31, 2016: EUR 12.3 million).

Operational highlights

– Contract with U.S. Department of Veterans Affairs: As announced on March 3, 2017, the U.S. Department of Veterans Affairs has awarded Epigenomics’ distribution partner Polymedco, Inc. with a five-year supply contract for Epi proColon(R), commencing March 1, 2017. The Veterans Administration operates the nation’s largest integrated healthcare system, with more than 1,700 hospitals, clinics, community living centers, domiciliaries, readjustment counseling centers, and other facilities.

– Epigenomics Joins Forces with “80% by 2018” initiative: Epigenomics has made the pledge to help increase colorectal cancer screening rates by supporting the 80% by 2018 initiative, led by the American Cancer Society (ACS), the Centers for Disease Control and Prevention (CDC) and the National Colorectal Cancer Roundtable (a coalition co-founded by ACS and CDC). “80% by 2018” is a shared goal to have 80% of adults aged 50 and older screened for colorectal cancer by 2018.

– ADMIT study results published: The Journal of “Cancer Treatment and Research Communications” published results of the ADMIT trial (ADherence to Minimally Invasive Testing) with Epi proColon. Study results confirm that a blood-based colorectal cancer screening test has the potential to increase the participation in colorectal cancer screening compared to a fecal test. The study demonstrated a 99.5% rate of adherence to CRC screening using Epi proColon.

– Systematic study review for Epi proColon published: Scientific results of a recent systematic review and meta-analysis of clinical studies with Epi proColon were published in “Clinical and Translational Gastroenterology”, a journal of the Nature Publishing Group. After analyzing results from 25 independent studies from different geographical areas, the authors conclude that methylated Septin 9 detected by the Epi proColon test “is a reliable blood-based marker in colorectal cancer detection”.

– Publication in Journal of Molecular Diagnosis & Therapy: An independent, peer-reviewed article on the blood-based colorectal cancer screening test Epi proColon 2.0 CE was published in the Journal of Molecular Diagnosis & Therapy. According to the study authors Yvette N. Lamb and Sohita Dhillon, Epi proColon(R) 2.0 CE demonstrated high sensitivity and specificity in case control studies. Furthermore, it provides a patient-friendly option that may increase participation in colorectal cancer screening programs.

Outlook 2017 confirmed

The Company confirms the outlook for the financial year 2017 as provided on April 26, 2017.

Further Information

The report on the first quarter 2017 can be downloaded from Epigenomics’ website at:
www.epigenomics.com/en/news-investors/investors/financial-reports.html

Conference call for analysts and investors

The Company will host a conference call and webcast at 4.00 pm CET / 10.00 am EDT, today. The presentation can be followed on the Company’s website.

The dial-in numbers for the conference call are:

Germany: +49 30 232531411
UK: +44 1635 598058
USA: +1 646 7129911

A transcript of the conference call will be provided on Epigenomics’ website subsequently: https://www.epigenomics.com.

About Epigenomics

Epigenomics is a molecular diagnostics company focused on blood-based detection of cancers using its proprietary DNA methylation biomarker technology. The company develops and commercializes diagnostic products across multiple cancer indications with high medical need. Epigenomics’ lead product, Epi proColon, is a blood-based screening test for the detection of colorectal cancer. Epi proColon has received approval from the U.S. Food and Drug Administration (FDA) and is currently marketed in the United States, Europe, and China and selected other countries. Epigenomics’ second product, Epi proLung(R), is in development as a blood-based test for lung cancer detection.

For more information, visit www.epigenomics.com.

Contact:
Epigenomics AG, Investor Relations, Peter Vogt, Geneststrasse 5, 10829 Berlin, Tel +49 (0) 30 24345 386, Fax +49 (0) 30 24345 555, E-Mail: ir@epigenomics.com

Epigenomics legal disclaimer

This communication expressly or implicitly contains certain forward-looking statements concerning Epigenomics AG and its business. Such statements involve certain known and unknown risks, uncertainties and other factors which could cause the actual results, financial condition, performance or achievements of Epigenomics AG to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Epigenomics AG is providing this communication as of this date and does not undertake to update any forward-looking statements contained herein as a result of new information, future events or otherwise.

Press release

Epigenomics AG Reports Results for Financial Year 2016

Berlin (Germany) and Germantown, MD (U.S.A.), April 26, 2017 – Epigenomics AG (FSE: ECX, OTCQX: EPGNY), or the “Company”, today announced its financial results for the year ended December 31, 2016.

Financial results

– In 2016, Epigenomics’ total revenue increased by 102% to EUR 4.2 million (2015: EUR 2.1 million), exceeding previous year’s figure and meeting the Company’s guidance. Product sales reached EUR 2.2 million, an increase of 41% year-over-year. Revenue of about EUR 1.4 million was generated through the sale of intellectual property rights.

– Total operating costs increased to EUR 17.3 million (2015: EUR 12.2 million). Research and development costs decreased by more than EUR 0.6 million to EUR 5.1 million (2015: EUR 5.8 million). Selling, general and administrative costs were up EUR 5.1 million to EUR 10.2 million (2015: EUR 5.1 million), mainly attributable to share-based payment expenses and legal and audit fees for an SEC filing in the U.S.

– Operating loss (EBIT) in 2016 increased to EUR -12.3 million (2015: EUR -9.3 million). Net loss increased to EUR -11.2 million (2015: EUR -9.0 million). Due to an increase in the average number of shares outstanding compared to 2015, loss per share in 2016 increased only slightly to EUR -0.55 (2015: EUR -0.52).

– Cash consumption in 2016 amounted to EUR 13.7 million (2015: EUR 8.0 million). Due to net cash inflows from financing activities in the amount of EUR 17.4 million in 2016 (2015: EUR 9.0 million), net cash flow increased to EUR 3.8 million (2015: EUR 1.1 million).

– The Company’s liquidity at year-end 2016 was EUR 12.3 million (Dec 31, 2015: EUR 8.6 million).

Outlook 2017

Revenue

– Our business projections for 2017 are mainly based on the sales of Epi proColon in the U.S.A. As such, our revenue in 2017 can vary substantially based upon timing of decisions on medical guidelines and payor coverage specifically Medicare. Until we achieve greater clarity on guideline inclusion and payor coverage, we expect our 2017 revenue to be broadly consistent with our 2016 product and licensing revenue. The level of 2016 product revenue was impacted by initial stocking effects from our commercialization partner post FDA approval. We do not anticipate such initial effects in 2017 and revenue generated in 2017 is estimated based upon increased test volume.

EBITDA

– Our efforts to expand commercial activities in the U.S. market for our lead product will initially burden our operating result. Reflecting these commercialization costs, we expect EBITDA before share-based payment expenses for 2017 to be at a lower level than in 2016. A range from EUR -12.0 to -13.5 million is assumed for 2017.

Cash consumption

– Based on our business plan for 2017, we expect cash consumption in line with our EBITDA guidance. The cash outflows for 2017 are related to our commercialization activities in the United States, clinical studies such as the post approval study, and continued development of our pipeline products.

– We ended 2016 with EUR 12.3 million in cash and marketable securities. We have planned our financing needs based on the assumption that 2017 revenue will be in line with 2016 product and licensing revenue. Any required working capital financing can – subject to certain conditions – be covered on the basis of the investment obligation of Blitz F16-83 GmbH (in the future Summit Hero Holding GmbH) in a cash amount of up to approximately 6.46 million Euros.

– While current financial resources are expected to be sufficient to support the Company’s operations at our projected cash consumption beyond 2017, we may raise additional capital in 2017. These additional funds would be utilized to extend operations beyond 2017 and/or increase our investment in certain areas based upon market conditions and opportunities.

Further Information

The annual report 2016 can be downloaded from Epigenomics’ website at:
www.epigenomics.com/en/news-investors/investors/financial-reports.html

Conference call for analysts and investors

The Company will host a conference call and webcast at 2.30 pm CET / 8.30 am EST, today. The presentation can be followed on the Company’s website.

The dial-in numbers for the conference call are:

Dial-in number within Germany: +49 30 2325 314 11

Dial-in number within the UK: +44 203 3679216

Dial-in number within the U.S.A.: +1 408 9169838

Participants are kindly requested to dial in 10 minutes prior to the start of the call.

Both an audio replay of the conference call and a transcript of the conference call will be provided on Epigenomics’ website subsequently: https://www.epigenomics.com.

About Epigenomics

Epigenomics is a molecular diagnostics company focused on blood-based detection of cancers using its proprietary DNA methylation biomarker technology. The company develops and commercializes diagnostic products across multiple cancer indications with high medical need. Epigenomics’ lead product, Epi proColon, is a blood-based screening test for the detection of colorectal cancer. Epi proColon has received approval from the U.S. Food and Drug Administration (FDA) and is currently marketed in the United States, Europe, and China and selected other countries. Epigenomics’ second product, Epi proLung(R), is in development as a blood-based test for lung cancer detection.

For more information, visit www.epigenomics.com.

Contact:
Epigenomics AG, Investor Relations, Peter Vogt, Geneststrasse 5, 10829 Berlin, Tel +49 (0) 30 24345 386, Fax +49 (0) 30 24345 555, E-Mail: ir@epigenomics.com

Epigenomics legal disclaimer

This communication expressly or implicitly contains certain forward-looking statements concerning Epigenomics AG and its business. Such statements involve certain known and unknown risks, uncertainties and other factors which could cause the actual results, financial condition, performance or achievements of Epigenomics AG to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Epigenomics AG is providing this communication as of this date and does not undertake to update any forward-looking statements contained herein as a result of new information, future events or otherwise.