ASX RELEASE

17 May 2016

Shareholder  Update  Presentation  

Brisbane,  17th  May  2016.  Factor  Therapeutics  Limited’s  (ASX:FTT)  management  team  will  be  giving  a  series  of  investor  updates  and  presentations  in  Sydney,  Melbourne  and  Brisbane  during  the  week  of  the  16th  of  May.    

This  presentation  material  incorporates  various  progress  updates  that  will  be  communicated  to  shareholders  and  investors  in  the  course  of  those  presentations.    

- ENDS -

   Corporate  Contact    Dr.  Christian  P.  Behrenbruch  Executive  Director  Factor  Therapeutics  Limited  Tel:  +61  7  3334  3900  Email:  c.behrenbruch@factor-­‐therapeutics.com    

About  Factor  Therapeutics  

Factor   Therapeutics   Limited   is   a   biomedical   technology   company   that   is   developing   significantly  more   effective  treatments   for   acute   and   chronic   wound   healing   applications,   including   chronic   skin   ulcers   and   burns.   Factor  Therapeutics  is  commercialising  VF-­‐001  (previously  denoted  VitroGro®  ECM),  a  technology  created  by  cell  biology,  tissue   engineering   and   protein   engineering   experts   at   the   Institute   of   Health   and   Biomedical   Innovation   at   the  Queensland  University   of   Technology.   The   business   owns   various   patent   families   related   to  wound   healing   and  other  therapeutic  uses.  The  Company’s  shares  are  traded  on  the  Australian,  Berlin  and  Frankfurt  stock  exchanges.  For  more  information,  please  visit  www.factor-­‐therapeutics.com      

Important  information  

This  announcement  does  not  constitute  an  offer  to  sell,  or  a  solicitation  of  an  offer  to  buy,  securities  in  the  United  States,  or   in  any  other   jurisdiction  in  which  such  an  offer  would  be  illegal.  The  securities  referred  to  herein  have  not   been   and  will   not   be   registered   under   the  United   States   Securities   Act   of   1933   (the   ‘US  Securities   Act’),   or  under   the   securities   laws  of  any   state  or  other   jurisdiction  of   the  United  States  and  may  not  be  offered  or   sold  within  the  United  States,  unless  the  securities  have  been  registered  under  the  US  Securities  Act  or  an  exemption  from  the  registration  requirements  of  the  US  Securities  Act  is  available.  This  document  may  not  be  distributed  or  released  in  the  United  States.      

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Shareholder

Update

May, 2016

Factor Therapeutics Limited

ASX : FTT

FACTORT H E R A P E U T I C S

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Notices

2

The information contained in the presentation is not intended to be an offer for subscription, invitation or

recommendation with respect to shares in any jurisdiction.

No representation or warranty, express or implied, is made in relation to the accuracy or completeness of the

information contained in this document or opinions expressed in the course of this presentation. The information

contained in this presentation is subject to change without notification.

This presentation contains forward-looking statements which can be identified by the use of words such as “may”,

“should”, “will”, “expect”, “anticipate”, “believe”, “estimate”, “intend”, “scheduled” or “continue” or similar expressions.

Any forward-looking statements contained in this presentation are subject to significant risks, uncertainties,

assumptions, contingencies and other factors (many of which are outside the control of, and unknown to Factor

Therapeutics Limited, and its officers, employees, agents or associates), which may cause the actual results or

performance to be materially different from any future result so performed, expressed or implied by such forward-

looking statements.

There can be no assurance or guarantee that actual outcomes will not differ materially from these statements.

The photographs of clinical subjects used in this presentation are illustrative of medical conditions associated with

potential applications of VF-001 (formerly marketed as VitroGro®). Actual clinical results may vary from those shown.

Relevant images accessed under Creative Commons.

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Corporate Dashboard

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ASX ticker FTT

Product focus area Advanced Wound Care

Headquartered Brisbane, Australia

Clinical stage Phase II

Total issued capital 724,328,499 shares

Options 2,500,000 options

Share price* $0.036

Market capitalisation* $26m

Cash position ~$15m

Top 20 ownership 52% of cap table

*As at 13/05/2016

AUD $15m financing completed 3rd of May (1st placement tranche : 18th of March)

Corporate adviser : Taylor Collison

$10m over-subscribed placement / $5m rights issue

Shareholder base has been significantly institutionalised

Primary use of proceeds : US multi-centre Phase II trial (to be reported Q3, 2017)

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Key activities since first closing

of financing (18th of March)

Process transfer for manufacture

of clinical lots for US Ph II study

Establishment of medical

advisory board (MAB)

Contracting of CRO for Phase II

study

Finalisation of clinical protocol

for Phase II

Submission of IND amendments

to the FDA

Off clinical hold

Approximate timeline for further

shareholder information

Engineering run ok, cGMP lots by

end-May

Excellent progress in recruiting,

contracted by end-May

Critical path – complete ASAP

(final qualification in progress)

Under review, finalisation contingent

on selecting CRO

Target : end-June (lot certificates,

amended protocol)

End-July is the target*

4*Subject to no further questions/issues raised by the FDA

In parallel : site selection/qualification, validation of enrolment estimates,

contracting, ethics

Activity SummaryF

or p

erso

nal u

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nly

Focus : Manufacturing of Clinical Lots

Initiated on the 18th of March

Validation and transfer of materials

from Europe to the US (Boston)

Establishment of Phase II appropriate

(small scale) fill-and-finish process that

is “comparable” to prior large-scale EU

manufacturing.

Site qualification / audit

Engineering run – successfully completed during the last week of April

GMP run to be finished by end-May (standard dose, high dose,

placebo) but release assays still to be completed in Europe (our

validated assays) post-manufacturing

Lot release assays : end-May / early June

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CRO

QA/RA

Manufacturing & Supply Chain

Medical Advisory

Board (MAB)

Advisory / Services Overhaul

6

FTT’s new FDA

authorised

representative,

Vast experience

with all stages

of biologics

development

Four proposals received. Two

firms undergoing proposal

refinement / qualification

1 x AU

2 x US

1 x EU

KOLs*

Fill and finish

manufacturing

moved to the

US (scale-

appropriate)Labelling, storage, cold chain

and logistics

FTT has completely

overhauled its advisory

and service provider

relationships

*KOL = Key Opinion Leaders. TBA

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Ok – Financing done,

manufacturing in progress.

What about the trial?

Precision Wound Care

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Value Inflection : Recap

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Phase II Efficacy

Study (US)

EMA

Resubmission

VF-001 Partnering

Indication

Expansion

Ocular

Collaboration

~18 months

• Build a partnering-

quality data set

• Move the company

toward Phase III as a

biologic drug in the US

• Meet the additional

safety database

requirements for EMA

to enable CE Mark

resubmission

• Our Phase II study will

meet the additional

clinical data

requirements for EMA

• Some limited non-

clinical work should

pave the way for re-

submission end-2017

• Focus : DFUs*

• Will be supported

by clinical data

• New applications

• IP “ever-greening”

*Diabetic foot ulcers

• New market

opportunities

Our planned Phase II study in

the US underpins most of the

value creation in the next 18

months.

Designing this study for

maximum impact, both

clinically and commercially,

is vitalFor

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VLUs : Market Characteristics

Venous Leg Ulcers (VLUs) : a volume market

Oft-cited “3% of the population, millions of potential patients”

Chronic wounds constitute 5-7% of healthcare costs

The reality?

For the majority of patients, nothing has yet beaten high

quality compression bandaging / moisture dressings

The general trend is toward treating VLUs in the

community setting. Anything that involves a “procedure”

therefore does not address the clinical unmet need:

• Tissue-derived products must be used by a physician, really

only applicable to the most serious (5-6%) of ulcer patients

• Anything that sutures or involves grafting, tissue harvesting,

etc. is not applicable to the “community setting”

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Venous Leg

Ulcer

Topical

Delivery

Accelerated

Healing

Treatments for VLU are highly price sensitive and need to be able to be used outside of the

specialty wound care setting. Expensive and complex procedures don’t fit this market.

This is Factor Therapeutics’ unique opportunity because our product is simple to administer

and our COGS is low

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VLUs : Margolis Wound “Severity” Scores

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Severity

Proportion in

the real world

population

Probability of Healing within 24

Weeks with Limb Compression

(%)*

Baseline

Ulcer Area

(cm2)

Ulcer

Duration

(months)

0 (least

severe)~ 69% 93.0 % ≤ 5 ≤ 6

1 (middle)~ 25%

65.0 %

≤ 5 > 6

> 5 ≤ 6

2 (most

severe)~ 6% 13.0 % > 5 > 6

* Margolis DJ, Berlin JA, Strom BL. Which venous leg ulcers will heal with limb compression bandages? Am J Med. 2000 Jul;109(1):15-9.

The vast majority of these patients

will be treated in the community

setting, not the specialty care setting

Seminal work by epidemiologist and wound care expert, Dr. David Margolis

(U. Penn), provides a simple classification for VLUs that is very meaningful to

understanding the clinical strategy for VF-001

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Potential Impact of Margolis on VF-001

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Marg

olis 1

Ma

rgo

lis

0

• Severe disease – treated in the specialty wound care setting.

• High cost-benefit supports expensive treatments

• Grafts, cell therapies, scaffolds, advanced materials.

• Highly fragmented / congested market

6% 31% 100%Cumulative Patient Population

Severity

of

venous d

isease

High

Low

• Mild disease – community care

• Compression bandaging, dressings

• Highly fragmented / congested

market (low “value”/differentiation)

Clinical unmet need, low competition.

A cost-effective treatment that can be used

in the community setting would be a game-

changer

Marg

olis 2

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z

Marg

olis 2

Ma

rgo

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0

6% 31% 100%Cumulative Patient Population

Severity

of

venous d

isease

High

Low

Our VF-001 Clinical Data Supports This View

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No benefit

observed

3x faster healing

in moderately

severe patients*

*Based on a retrospective cross-trial analysis of 48 patients in an open-label study

3xP=0.103

P=0.002M

arg

olis 1

Time (Days)

0 20 40 60 80 100

Cum

ulat

ive

Prob

abili

ty o

f Non

-Hea

ling

0.0

0.2

0.4

0.6

0.8

1.0

Community (N=33)VitroGro ECM (N=12)Clinic (N=36)

~ 10%

improv.

P=0.029

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Impact on Clinical Trial Design

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Margolis 0 Patients

VF-001 demonstrates limited benefit. These patients respond

well to “standard care” (bandaging / moisture dressings)

Contributes to cost-benefit but is not our biggest value-add

Wish to exclude the “easy” healers because they increase

the number of patients (and $) required to show efficacy

Margolis 2 Patients

Severe venous disease, effectively “multi-pathology” (co-morbidities)

Based on our limited data, VF-001 has no detectable efficacy in this patient population

We want to exclude these patients because they don’t contribute to efficacy

Margolis 1 Patients : Target Patient Population for Trial Efficacy

Moderately severe ulcers – treated in the community setting

Impacting the health of these patients is of enormous benefit. These are the “hard to

heal” patients that cost the most in the community care setting, and where our product

has the strongest signal

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Impact on Product Label?

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For Margolis 0/1 patients, Standard Care will

always involve compression bandaging and

moisture dressings in the community setting. It is

cheap, effective, not yet beaten

Negative pressure wound care systems may

have future applicability but are not yet clinically

proven for VLU – more of a novelty at this stage

Margolis “classification” is a high-level strategy

for patient delineation. It is an “effect”, not a

“score”. Qualitative, not quantitative

In the “real world”, we will exclude patients with

severe venous disease (Margolis 2s) by

size/duration of ulcer

In the “real world”, we will not exclude Margolis 0

patients from treatment eligibility, rather we will

require that those patients have not responded

to a duration of Standard Care (say, 4-8 weeks)

Post-Treatment

(Week8)

Baseline

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Precision Wound Care

Based on expert consultation we have refined a clinical

design that targets our optimal patient population

The use of a “precision” medicine approach is relatively

unexplored in wound care and likely why many products

have failed

We will pre-screen and eliminate “easy” Margolis 0 patients

(by giving a duration of Standard Care and excluding

patients that stabilise/improve). We will also exclude severe

venous disease (Margolis 2s)

We learned a great deal from the last clinical trial, which

was “enriched” for Margolis 1 and Margolis 2 patients

We now need to further validate the efficacy signal we have

previously seen in a blinded, placebo-controlled study

Primary end-point : % of patients fully healed after 12 weeks

of treatment (+ standard care) per FDA guidance

Important secondary end-points : time to healing, pain

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Cell attachment to

the wound bed via

VF-001

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Concluding Remarks

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Immediate launch of clinical activities post-financing

Manufacturing of clinical lots on track

Refinement of clinical trial protocol based on expert review of our prior

clinical data, optimisation of inclusion/exclusion criteria for our target patient

population

As previously disclosed, revised protocol will be submitted to FDA along with

certifications of analysis (target : end-June)

The next general shareholder update will focus on medical advisory board,

CRO selection, site selection progress, etc.

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