Half-year Financial Report H1 2024

Half-Year Financial Report 2024

30/06/2024

This interim financial report is prepared in accordance with article 13 of the Royal Decree on the obligations of issuers of financial instruments admitted to trading on a regulated market.

BioSenic SA publishes its interim financial report in English. A French translation of the report will also be made available. In the event of differences between the English and the French versions of the report, the French version will prevail.

BioSenic's Half-Year Financial Report 2024 (30/06/2024)

1. REPORT OF THE BOARD OF DIRECTORS

Dear Shareholders,

We are pleased to present to you our half-year financial report including the consolidated financial statements for the accounting period that ended 30 June 2024 prepared in accordance with the International Financial Reporting Standards (IFRS) as adopted by the European Union.

Clinical and Corporate Highlights

• In January 2024, Dr Carole Nicco has been promoted to Chief Operating Officer (COO) in addition to her position as Chief Scientific Officer (CSO).
• In January 2024, BioSenic's subsidiary, Medsenic SAS, signed a binding term sheet with Phebra PTY Ltd. related to an adaptation of the License Agreement and the MDA signed in May 2021.
• In January 2024, BioSenic filed for a U.S. patent for JTA-004, a viscosupplement in late-stage clinical development, following a post hoc analysis showing its efficacy in a recently defined subtype of osteoarthritis (OA).
• In January 2024, BioSenic has been granted a patent by the Canadian Intellectual Property Office to expand protection of the arsenic trioxide (ATO) platform. The patent, titled "Use of metal ions to potentiate the therapeutic effects of arsenic", covers the use of ATO platform in combination with metal ions such as copper.
• In March 2024, BioSenic published an open-access article describing an optimized schedule for administration of oral arsenic trioxide (OATO) treatment for chronic graft-versus-host disease (cGvHD), based on an earlier post-hoc analysis of Phase II data.
• In June 2024, BioSenic's board of directors acknowledged the resignation of Mr Yves Sagot as an independent director of the Company, with effect from the Company's 2024 ordinary general meeting.
• In July 2024, BioSenic signed of global licensing, supply and commercialization agreements with Phebra Pty Ltd. related to the adaptation of the License Agreement and the MDA signed earlier in May 2021, when Phebra became a minority shareholder in Medsenic SAS.
• In July 2024, BioSenic filed of the continuation patent application US 18/763,376 with the United States Patent & Trademark Office (USPTO) to provide protection for the use of arsenic trioxide (ATO) for the prevention and treatment of sepsis syndrome.
• In July 2024, BioSenic released new in-depth analysis of its positive phase 2 clinical data for optimal administration scheme for its next late-stage trial of arsenic trioxide (ATO) targeting cGvHD.
• In August 2024, BioSenic announced the granting of a key patent by the Japan Patent Office to expand protection of the arsenic trioxide (ATO) platform.
• In August 2024, BioSenic announced that the European Patent Office (EPO) has granted an important new EU patent to its subsidiary Medsenic "method for treating relapsing-remittingmultiple sclerosis using arsenic trioxide".
• In September 2024, Véronique Pomi-Schneiter stands down as BioSenic's Deputy CEO.

Financial Highlights for the 6-month period ended 30 June 2024

• In January 2024, BioSenic signed a new subscription agreement for a maximum EUR 1.2 million convertible bonds facility, arranged by ABO Securities through its affiliated entity Global Tech Opportunities 15.

• In February 2024, BioSenic raised EUR 500,000 via a private placement.
• In April 2024, BioSenic filed a debt restructuring plan with the clerk's office of the Walloon Brabant Enterprise Court, with a view to requesting the Court to open private judicial reorganization proceedings by collective agreement and to obtain the agreement of creditors on a plan to reorganize BioSenic's debt. Please refer to the press releases of 11 April 2024,12 April 2024 and 26 April 2024 on this subject for further information.
• In April 2024, in view of the debt restructuring plan, BioSenic postponed its annual general meeting of the shareholders.
• In May 2024, BioSenic provided its business update for the first quarter, ended the 31 March 2024.
• In May 2024, the Walloon Brabant Enterprise Court registered the positive votes of the majority of BioSenic's creditors on the debt restructuring plan.
• In June 2024, BioSenic announced its business update and full year financial results for the year ending 31 December 2023, prepared in accordance with IFRS.
• In June 2024, BioSenic received the homologation judgment for the restructuring plan filed with the Enterprise Court of Nivelles, making it binding on all deferred creditors, and the measures provided for therein will continue until June 2029, the end of the five-year period set by law. The restructuring plan can be accessed via the following link: https://biosenic.com/sites/default/files/2024- 04/PRJ_BioSenic_FR.pdf
• In June 2024, BioSenic signed a new subscription agreement for a maximum EUR 2.1 million convertible bonds facility, arranged by ABO Securities through its affiliated entity Global Tech Opportunities 15.
• During the first six months of 2024, total operating income amounted to EUR 2.69 million, compared to EUR 0.37 million in H1 2023.
• Operating loss for the period amounted to EUR 0.47 million, compared to EUR 3.90 million in H1 2023.
• BioSenic ended the first six months of 2024 with EUR 0.82 million in cash and cash equivalents. Net cash generated for the period amounted to EUR 0.70 million, compared to a net cash used of EUR 1.33 million over the same period of 2023.

Financial review

Income statement

In the first six months of 2024, total operating income amounted to € 2.69 million compared to € 0.37 million for the first half of 2023. Operating income is mainly due to the result obtained following the approval by the Enterprise Court of Nivelles of the restructuring plan, which will have a positive impact of € 2.48 million, by income on subletting for € 0.13 million and by the tax credit on investments (for € 0.05 million).

The research and development expenses for the first six months amounted to € 1.63 million compared to

• 2.45 million over the same period last year. The decrease in expenses is mainly related to the decrease of the people costs in BioSenic (only 1 FTE in R&D in 2024) and by the stop of investing in patents for ALLOB and JTA.

General and administrative expenses for the first six months amount to € 1.53 million compared to € 1.81 million over the same period last year. The decrease is mainly explained by a decrease of the other operation costs mainly in terms of preparation of the fund raise, audit expenses and also consultancy expenses. The high level of costs is also explained by the fact that, as a listed company, BioSenic has a certain number of expenses linked to legal obligations (such as communications or financial reporting).

As a result, the operating loss amounted to € 0.47 million in the first half of 2023, compared to € 3.90 million in the same period in 2023.

The net financial profit amounted to € 0.82 million compared with a net financial loss of € 1.07 million over the same period last year. This financial profit was made possible by 2 impacts: the first was the recognition of the debt owed by the Walloon Region (in respect of recoverable advance contracts), which was written off in the amount of € 0.73 million. The 2nd impact is directly attributable to the valuation of the conversion of ABO's convertible bonds into shares for an amount of € 0.85 million. In return, the company recognized € 0.79 million in interest on EIB loans and loans to insurers.

Last year, the company recognized the impairment of ALLOB, the allogeneic bone cell therapy intangible asset, for an amount of € 14.91 million and the impairment of goodwill for an amount of € 1.80 million.

The net profit for the period amounted to € 0.35 million during the first six months ended 30 June 2024 compared to a loss of € 21.09 million in 2023.

Balance sheet

The Group's total assets amounted to € 9.40 million on 30 June 2024 compared with € 9.56 million at the end of December 2023 mainly explained by the decrease of the non-current assets and partly compensated by the increase of the current assets.

Non-Current assets decreased by 12% to € 6.81 million at the end of June 2024 (€ 7.71 million in 2023). The decrease is mainly explained by the decrease of the R&D tax credit with a reclassification of € 0.64 million in the current assets.

The current assets decreased from € 1.85 million to € 2.54 million. The increase is mainly explained by the increase of the cash and cash equivalents of € 0.70 million showing a cash position of € 0.82 million on 30 June 2024.

In summary, the total assets are mainly composed of R&D tax credit for € 3.63 million, the license with PHEBRA has been valued at €2.98 million, a total of PPE and finance lease for € 1.06 million and a cash position of € 0.82 million.

The Group's equity increased from a negative amount of € 22.91 million at the end of December 2023 to a negative amount of € 20.40 million on 30 June 2024, as a result of a total equity raise amount of € 2.13 million higher than the incorporation of the profit for the period (amounting to € 0.35 million).

Liabilities amounted to € 29.80 million in 2024 compared with € 32.26 million at the end of December 2023 representing a decrease of € 2.47 million.

The non-current liabilities increased compared to last year and amounted to € 23.31 million. It is directly linked to the approval by the Court of the restructuring plan and the repayment of € 7.5 million of convertible bonds by the end of 2030. The non-current liabilities are mainly composed by the non-convertible bonds for an amount of € 15.48 million, the debts to be repaid to the Walloon Region in relation of Recoverable cash advances for € 3.51 million, the bank debt for € 0.58 million, the leasing debts for € 0.63 million and the interest-free advances for € 0.62 million.

Current liabilities largely decreased by € 8.41 million and amounted to € 7.43 million on 30 June 2024 (compared to € 15.84 million at the end of 2023). This decrease is mainly explained by the reclassification into the non-current accounts of the non-convertible bonds and convertibles bonds from the insurance companies to be repaid in 2030 (impact of € 7.69 million) and by the result obtained following the approval by the Enterprise Court of Nivelles of the restructuring plan, which will have a positive impact of € 2.48 million. The current liabilities are mainly composed by the trade and other payables for € 2.38 million, by the convertible bonds from ABO for € 2.03 million, the leasing debts for € 0.48 million, the debts to be repaid to the Walloon Region in relation of Recoverable cash advances for € 0.39 million, the bank debt for € 0.36 million and the interest-free advances for € 0.30 million.

Cash flow statement

The table in section 2.4 (see below) sets forth the Group's consolidated cash flow statement for the six-month periods ended 30 June 2024 and 30 June 2023.

Cash used for operating activities amounts to € 0.83 million for the first six months of 2024 compared to € 1.93 million for the first six months of 2023.

Total operating loss for the period amounts to € 1.46 million compared to a loss of € 3.90 million over the same period in 2023. The net negative impact of adjustments for non-cash items and working capital amounted to € 0.11 million compared to a net positive impact of € 0.33 million during the previous year relating to depreciation and recognition of tax credits.

The company also received an amount of € 0.74 million in relation to the tax credit.

The company has no Cash flow from investing activities.

Cash flow generated from financing activities amounts to a cash in of € 1.53 million for the first six months of 2024 compared with a cash in of € 0.60 million for the first six months of 2023.

Financial cash inflows during H1 2024 are as follows:

• Convertible Bonds from ABO for an amount of € 1.20 million.
• A proceed from the equity raise for € 0.50 million.
• And a new borrowing from BPI for € 0.21 million.

Financial cash outflows during H1 2024 are as follows:

• Repayment of the borrowings for € 0.12 million in 2023 (€ 0.15 million in 2023);
• Transactions costs for € 0.11 million in 2024.
• other reimbursements (lease contracts and other financial liabilities) for an amount of € 0.15 million in 2024.

Outlook for the remainder of 2024 and 2025

• Following the homologation judgement of 13 June 2024, BioSenic will take the necessary decisions to implement the approved plan and, notably, to retrocede its rights to the JTA and ALLOB technologies to the Walloon Region and to stop all activities in relation to such technologies.
• The Medsenic Phase II clinical study with arsenic trioxide in the first-line treatment of cGvHD has been completed and provided positive results. A Phase III study with oral arsenic trioxide in the first-line treatment of cGvHD, for which Medsenic received positive pre-IND response from the FDA, is currently anticipated to start in 2024. A Phase IIa clinical trial for systemic lupus erythematosus ("SLE") had previously established safety for the patient and efficacy on the course of the autoimmune disease. Positive preclinical work gives good grounds for a Phase II clinical trial on systemic sclerosis ("SSc"). Phase IIb clinical trials for SLE and SSc are in the planning stage with the protocols for both studies being ready.
• It will only be possible to start the SLE and SSc Phase 2b clinical trials if the BioSenic Group succeeds in concluding a strong partnership with a biopharmaceutical company or if it manages to successfully out-license some of its technology. The start of SLE and SSc Phase II clinical trials is therefore not envisioned before 2025.
• Maximum cost reduction and disciplined cash management will remain a key priority, and the situation will be closely and actively monitored.

• The Company will actively initiate the search for new assets through M&A processes.
• Negotiations with BioSenic's creditors will also be initiated as part of the potential sale of BioSenic's stake in Medsenic and other intellectual property assets held by BioSenic, and with a view to continuing the debt restructuring effort initiated following the court's approval of the plan.
• The Company has also invited Medsenic's representatives to urgently carry out a refinancing of Medsenic in which BioSenic will not participate.
• Financing for the next few months has been secured by means of an amendment to the convertible bond contract with GTO 15, allowing up to EUR 1.5 million to be drawn down, including at least two tranches of EUR 0.2 million net without any liquidity conditions.

Risks and uncertainties

For a detailed description of the risks associated with the activities of the Group, we refer to the Annual Report 2023 available on the Company's website.

2.2. Unaudited Interim Condensed Consolidated Statement of Comprehensive Income

The above condensed consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.

2.3. Unaudited Interim Condensed Consolidated Statement of Changes in Shareholders' Equity

The above condensed consolidated statement of changes in shareholders' equity should be read in conjunction with the accompanying notes.

2.4. Unaudited Interim Condensed Consolidated Statement of Cash Flows

The above condensed consolidated statement of cash flows should be read in conjunction with the accompanying notes.