GlobeNewswire Inc | Nov 12, 2021 07:00AM EST

November 12, 2021

BALA CYNWYD, Pa., Nov. 12, 2021 (GLOBE NEWSWIRE) -- Larimar Therapeutics, Inc. (Larimar) (Nasdaq: LRMR), a clinical-stage biotechnology company focused on developing treatments for complex rare diseases,today reported its third quarter and year to date September 30, 2021 operating and financial results.

We are advancing towards 2022 with a strong balance sheet, the backing of high-quality institutional investors, and compelling Phase 1 data that demonstrate proof-of-concept for CTI-1601, said Carole Ben-Maimon, MD, President and Chief Executive Officer ofLarimar. We continue to collect and analyze data from our 180-day non-human primate toxicology study so that we can continue moving towards the resolution of CTI-1601s clinical hold and an expected return to the clinic in the first half of next year. We are working expeditiously towards this goal, as patients with Friedreichs ataxia (FA) urgently need disease-modifying therapies. With a differentiated mechanism of action targeting the root cause of FA, we believe CTI-1601 is uniquely positioned to potentially address this need and look forward to its continued clinical development.

Third Quarter 2021 Highlights

-- Prior to the third quarter, the United States Food and Drug Administration (FDA) placed a clinical hold on the CTI-1601 clinical program after Larimar notified the agency of mortalities that occurred at the highest dose levels of a 180-day non-human primate (NHP) toxicology study designed to support extended dosing of patients with CTI-1601. In the clinical hold letter, the FDA stated that it needs a full study report from the NHP study andthat Larimarmay not initiate additional clinical trials until the Company has submitted the report and received notification from the agency that additional clinical trials may commence. At the time of the notice, the Company had no interventional clinical trials with patients enrolled or enrolling.In July 2021, Larimar completed dosing in the 180-day NHP toxicology study, and it continues to collect and analyze data. While there is no way to predict the FDAs response (which the Company anticipates will not be received prior to the first quarter of 2022) or whether they will require additional data or testing before lifting the clinical hold on CTI-1601 in full or in part, the Company expects to initiate its Jive open-label extension and pediatric multiple ascending dose trials in the first half of next year.

-- Under an Equity Distribution Agreement with an investment bank, the Company may sell up to an aggregate of $50 million of shares of common stock from time to time in connection with an at the market program. In July 2021, the Company sold 2,342,720 shares under the agreement for net proceeds of $19.9 million. As of September 30, 2021 and the date of this announcement, $29.2 million of common stock remains available for sale under this program. -- In August 2021, Larimar initiated a non-interventional healthy volunteer study designed to generate data for comparison to patients with FA.

Third Quarter 2021 Financial Results

As of September 30, 2021, the Company had cash, cash equivalents and marketable debt securities totaling $78.0 million.

The Company reported a net loss for the third quarter of 2021 of $16.8 million, or $0.92 per share, compared to a net loss of $10.3 million, or $0.64 per share, for the third quarter of 2020.

Research and development expenses for the third quarter of 2021 were $14.0 million compared to $6.9 million for the third quarter of 2020. The increase in research and development expenses compared to the prior year period was primarily driven by higher clinical supply manufacturing costs of $6.4 million, higher non-clinical and internal laboratory costs of $1.3 million, an increase of $0.3 million in personnel related costs due to headcount additions in our research and development functions, and an increase of $0.3 million in stock-based compensation expense associated with stock option grants made in the second half of 2020 and thus far in 2021, partially offset by a decrease of $1.4 million in clinical trial costs.

General and administrative expenses for the third quarter of 2021 were $2.7 million compared to $3.4million for the third quarter of 2020. The decrease in general and administrative expenses as compared to the prior year period was primarily driven by a decrease of $1.1 million in professional fees primarily associated with accounting, legal and consulting fees partially offset by an increase of $0.8 million in stock-based compensation expense associated with stock option grants made in the second half of 2020 and thus far in 2021. General and administrative expenses for the third quarter of 2020 included costs associated with the Companys May 2020 reverse merger with Zafgen, Inc. (the Merger)

For the nine-months ended September 30, 2021, the Company reported a net loss of $41.5 million, or $2.48 per share, compared to a net loss of $28.3 million, or $2.69 per share for the same period in 2020.

Research and development expenses for the nine-months ended September 30, 2021 were $32.1 million compared to $20.8 million for the same period in 2020. The increase in research and development expenses compared to the prior year period was primarily driven by higher clinical supply manufacturing costs of $4.5 million, higher non-clinical and internal laboratory costs of $2.9 million, an increase of $1.7 million in personnel related costs due to increased headcount in our research and development functions, an increase of $1.1 million in stock-based compensation expense associated with stock option grants made in the second half of 2020 and thus far in 2021, and an increase of $0.9 million in clinical trial costs.

General and administrative expenses for the nine-months ended September 30, 2021 were $9.3 million compared to $7.6million for the same period in 2020. The increase in general and administrative expenses as compared to the prior year period was primarily driven by an increase of $1.8 million in stock-based compensation expense associated with stock option grants made in the second half of 2020 and thus far in 2021, and an increase of $1.2 million in costs required to function as a public company ( nine months as a publicly-held company in 2021 compared to four months as a publicly-held company in 2020), an increase of $0.5 million in personnel related costs due to increased headcount, partially offset by a decrease of $1.4 million in professional fees primarily associated with accounting, legal and consulting fees. General and administrative expenses for the nine months ended September 30,2020 included costs associated with the Merger.

About Larimar TherapeuticsLarimar Therapeutics, Inc.(Nasdaq: LRMR) is a clinical-stage biotechnology company focused on developing treatments for complex rare diseases. Larimars lead compound, CTI-1601, is currently being evaluated in a Phase 1 clinical program in theU.S.as a potential treatment for Friedreich's ataxia.Larimaralso plans to use its intracellular delivery platform to design other fusion proteins to target additional rare diseases characterized by deficiencies in intracellular bioactive compounds. For more information, please visit: https://larimartx.com.

Forward-Looking StatementsThis press release contains forward-looking statements that are based on Larimars managements beliefs and assumptions and on information currently available to management. All statements contained in this release other than statements of historical fact are forward-looking statements, including but not limited to statements regarding Larimars expectations regarding its ability to resolve the clinical hold imposed by the FDA related to CTI-1601, Larimars ability to develop and commercialize CTI-1601 and other planned product candidates, Larimars planned research and development efforts, including Larimars expectation that it will be able to initiate its Jive open-label extension and pediatric multiple ascending dose trials in the first half of 2022, and other matters regarding Larimars business strategies, use of capital, results of operations and financial position, and plans and objectives for future operations.

In some cases, you can identify forward-looking statements by the words may, will, could, would, should, expect, intend, plan, anticipate, believe, estimate, predict, project, potential, continue, ongoing or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words. These statements involve risks, uncertainties and other factors that may cause actual results, performance, or achievements to be materially different from the information expressed or implied by these forward-looking statements. These risks, uncertainties and other factors include, among others, Larimars ability to successfully engage with the FDA and satisfactorily respond to requests from the FDA for further information and data regarding CTI-1601, the timing and outcome of Larimars planned interactions with the FDA concerning the clinical hold on CTI-1601, the success, cost and timing of Larimars product development activities, nonclinical studies and clinical trials, including CTI-1601 clinical milestones; that clinical trial results may differ from final clinical trial results, that earlier non-clinical and clinical data and testing of CTI-1601 may not be predictive of the results or success of clinical trials, and assessments; the ongoing impact of the COVID-19 pandemic on Larimars future clinical trials, manufacturing, regulatory and nonclinical study timelines, ability to raise additional capital and general economic conditions; Larimars ability and the ability of third-party manufacturers Larimar engages, to optimize and scale CTI-1601s manufacturing process; Larimars ability to obtain regulatory approval for CTI-1601 and future product candidates; Larimars ability to develop sales and marketing capabilities, whether alone or with potential future collaborators, and to successfully commercialize any approved product candidates; Larimars ability to raise the necessary capital to conduct its product development activities; and other risks described in the filings made byLarimarwith theSecurities and Exchange Commission(SEC), including but not limited to Larimars periodic reports, including the annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, filed with or furnished to theSECand available atwww.sec.gov. These forward-looking statements are based on a combination of facts and factors currently known byLarimarand its projections of the future, about which it cannot be certain. As a result, the forward-looking statements may not prove to be accurate. The forward-looking statements in this press release represent Larimars managements views only as of the date hereof.Larimarundertakes no obligation to update any forward-looking statements for any reason, except as required by law.

Investor Contact: Company Contact:Joyce Allaire Michael CelanoLifeSci Advisors Chief Financial Officerjallaire@lifesciadvisors.com mcelano@larimartx.com(212) 915-2569 (484) 414-2715

Larimar Therapeutics, Inc.Condensed Consolidated Balance Sheets(unaudited) September30, December31, 2021 2020 Assets Current assets: Cash and cash equivalents $ 71,525 $ 68,148 Marketable debt securities 6,499 24,490 Prepaid expenses and other current assets 3,229 5,314 Total current assets 81,253 97,952 Property and equipment, net 1,135 1,040 Operating lease right-of-use assets 3,540 3,936 Restricted cash 1,339 1,339 Other assets 671 419 Total assets $ 87,938 $ 104,686 Liabilities and Stockholders? Equity Current liabilities: Accounts payable $ 1,766 $ 2,634 Accrued expenses 7,966 5,843 Operating lease liabilities, current 574 515 Total current liabilities 10,306 8,992 Operating lease liabilities 5,565 6,002 Total liabilities 15,871 14,994 Commitments and contingencies (See Note 9) Stockholders? equity: Preferred stock; $0.001 par value per share;5,000,000 sharesauthorized as of September 30, 2021 and December ? ? 31, 2020; noshares issued and outstanding as of September30, 2021 and December 31, 2020Common stock, $0.001 par value per share;115,000,000 sharesauthorized as of September 30, 2021 and December31, 2020; 18 15 17,710,450 and 15,367,730 shares issued andoutstanding as ofSeptember 30, 2021 and December 31, 2020,respectivelyAdditional paid-in capital 179,165 155,290 Accumulated deficit (107,116 ) (65,614 )Accumulated other comprehensive loss ? 1 Total stockholders? equity 72,067 89,692 Total liabilities and stockholders? equity $ 87,938 $ 104,686

Larimar Therapeutics, Inc.Consolidated Statements of Operations(In thousands, except share and per share data)(unaudited) Nine Months Ended September30, Nine Months Ended September30, 2021 2020 2021 2020 Operating expenses:Research and $ 14,028 $ 6,919 $ 32,104 $ 20,833 developmentGeneral and 2,702 3,416 9,275 7,575 administrativeTotaloperating 16,730 10,335 41,379 28,408 expensesLoss from (16,730 ) (10,335 ) (41,379 ) (28,408 )operationsOther income (75 ) 61 (123 ) 130 (expense), netNet loss $ (16,805 ) $ (10,274 ) $ (41,502 ) $ (28,278 )Net loss pershare, basic $ (0.92 ) $ (0.64 ) $ (2.48 ) $ (2.69 )and dilutedWeightedaverage commonshares 18,287,924 15,984,609 16,768,458 10,505,826 outstanding,basic anddiluted