GlobeNewswire Inc | Aug 11, 2020 07:00AM EDT

August 11, 2020

-- Merger between Chondrial Therapeutics and Zafgen completed and company began operating as Larimar Therapeutics -- Phase 1 clinical trial of CTI-1601 for treatment of Friedreichs ataxia restarts after delay due to COVID-19 related restrictions -- $80 million private placement financing completed with biotechnology-focused institutional investors -- Positive opinion on Orphan Drug Designation for CTI-1601 from the European Medicines Agency Committee for Orphan Medicinal Products -- New Board Chair, Chief Medical Officer and Chief Financial Officer appointed

BALA CYNWYD, Pa., Aug. 11, 2020 (GLOBE NEWSWIRE) -- Larimar Therapeutics, Inc. (Nasdaq:LRMR), a clinical-stage biotechnology company focused on developing treatments for complex rare diseases,today reported its second quarter 2020 operating and financial results.

The second quarter was a transformative period for Larimar as we completed the merger between Chondrial and Zafgen, strengthened our leadership team and raised significant capital. We believe these accomplishments have well positioned us to execute our strategy of developing treatments for complex rare diseases using our novel cell penetrating peptide technology platform, said Carole Ben-Maimon, MD, President and Chief Executive Officer of Larimar Therapeutics.We have sustained the momentum created by the merger with two recent important milestones, resumption of our Phase 1 clinical trial for CTI-1601 for the treatment of Friedreichs ataxia (FA) which allows our Phase 1 program to continue moving forward, and receipt of a positive opinion on orphan drug designation for CTI-1601 from the European Medicines Agency (EMA) Agency Committee for Orphan Medicinal Products (COMP).

Second Quarter and Subsequent Highlights

-- In May 2020, Larimar announced the completion of the reverse merger between Chondrial Therapeutics, Inc. and Zafgen, Inc. The combined, publicly traded clinical-stage biotechnology company began operating under the name Larimar Therapeutics, Inc. and its shares commenced trading on the Nasdaq Global Market on May 29, 2020, under the ticker symbol LRMR. -- In May 2020, Larimar completed a private placement of common stock and pre-funded warrants to purchase common stock for $80 million of gross proceeds before placement agent fees and expenses. The financing was led by Cowen Healthcare Investments, and includes participation from biotechnology specialist funds Acuta Capital, funds managed by Janus Henderson Investors, Logos Capital, OrbiMed, RA Capital Management, and Vivo Capital, along with other healthcare-focused institutional investors. These new investors in the financing, along with Deerfield Management, the companys largest pre-financing investor, and Atlas Ventures created a strong institutional shareholder base for the company. Together with approximately $40 million in cash on Zafgens balance sheet at the time of the merger, the combined company had approximately $116 million in cash immediately following the completion of the merger and the private placement. -- In May 2020, Larimar announced the appointment of Joseph Truitt as Chair of its Board of Directors. Larimars board of directors also includes Peter Barrett, PhD, Carole S. Ben-Maimon, MD, Thomas O. Daniel, MD, Tom Hamilton, Jonathan Leff and Frank E. Thomas. In addition, in May 2020, the company appointed Nancy Ruiz, MD, FACP, FIDSA, as Chief Medical Officer and Michael Celano as Chief Financial Officer. -- In July 2020, Larimar resumed dosing of patients in its Phase 1 clinical trial to evaluate the safety and tolerability of single ascending doses of CTI-1601 for the treatment of FA, allowing the program to continue moving forward. The trial was previously delayed due to the impact of the COVID-19 pandemic. Topline results are expected in the first half of 2021. -- In July 2020, the EMA COMP issued a positive opinion on the companys application for orphan drug designation for CTI-1601. Larimar expects that the European Commission, based on this positive opinion of the COMP, will formally grant the orphan drug designation for the European Union this year.

Second Quarter 2020 Financial ResultsAs of June 30, 2020, the Company had cash, cash equivalents, and marketable debt securities totaling $113.7 million.

The Company reported a net loss for the second quarter of 2020 of $11.3 million, or $1.21 per share, compared to a net loss of $3.7 million, or $0.61 per share, for the second quarter of 2019.

Research and development expenses for the second quarter of 2020 were $8.9 million compared to $3.1 million for the second quarter of 2019. The increase in research and development expenses compared to the prior year period was primarily due to an increase in external development costs for CTI-1601, an increase in personnel related costs due to headcount additions in our research and development functions and an increase in stock-based compensation.

General and administrative expenses for the second quarter of 2020 were $2.5 million, compared to $0.6 million for the second quarter of 2019. The increase in general and administrative expenses as compared to the prior year period was primarily due to an increase in professional fees resulting from the reverse merger and the costs of operating as a public company, an increase in legal fees associated with intellectual property filings and an increase in stock-based compensation.

About CTI-1601 CTI-1601 is a recombinant fusion protein intended to deliver human frataxin into the mitochondria of patients with Friedreichs ataxia (FA) who are unable to produce enough of this essential protein. Currently in a Phase 1 clinical trial in the U.S., CTI-1601 has been granted Rare Pediatric Disease designation, Fast Track designation and Orphan Drug designation by the U.S. Food and Drug Administration (FDA). Topline results from the Phase 1 clinical program are planned for the first half of 2021.

About Friedreichs ataxiaFriedreichs ataxia (FA) is a rare, progressive, multi-symptom genetic disease that typically presents in mid-childhood and affects the functioning of multiple organs and systems. The most common inherited ataxia, FA is a debilitating neurodegenerative disease resulting in multiple symptoms including progressive neurologic and cardiac dysfunction poor coordination of legs and arms, progressive loss of the ability to walk, generalized weakness, loss of sensation, scoliosis, diabetes and cardiomyopathy as well as impaired vision, hearing and speech. FA affects an estimated 4,000-5,000 individuals living in the United States and approximately 20,000 in the European Economic Area and United Kingdom. FA results from a deficiency of the mitochondrial protein, frataxin (FXN), which is found in cells throughout the body. To date, there are no medical treatment options approved for patients with FA.

About Larimar TherapeuticsLarimar Therapeutics, Inc. (Nasdaq:LRMR), is a clinical-stage biotechnology company focused on developing treatments for complex rare diseases. The companys lead compound, CTI-1601, is currently being evaluated in a Phase 1 clinical program in the U.S. as a potential treatment for Friedreichs ataxia, a rare and progressive genetic disease. Larimar also 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 the receipt of Orphan Drug Designation for the EU for CTI-1601 in FA from the European Commission, Larimars ability to develop and commercialize CTI-1601 and other planned product candidates, Larimars planned research and development efforts, 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, the success, cost and timing of Larimars product development activities, studies and clinical trials; the ongoing impact of the COVID-19 pandemic on Larimars clinical trial timelines, ability to raise additional capital and general economic conditions; Larimars ability to optimize and scale CTI-1601s manufacturing process; Larimars ability to obtain regulatory approval for CTI-1601 and future product candidates; the fact that the European Commission may not grant Orphan Drug Designation for the EU for CTI-1601 in FA or may do so in a longer than anticipated timeframe; Larimars ability to develop sales and marketing capabilities, whether alone or with potential future collaborators, and 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 by the Company with the Securities 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 the SEC and available atwww.sec.gov. These forward-looking statements are based on a combination of facts and factors currently known by Larimar and 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 views as of the date hereof. Larimar undertakes no obligation to update any forward-looking statements for any reason, except as required by law.

Investor Contact:John WoolfordWestwickejohn.woolford@westwicke.com443-213-0506

Media Contact:Gina Cestari6 Degrees(917) 797-7904gcestari@6degreespr.com

Larimar Therapeutics, Inc.Condensed Consolidated Balance Sheets(in thousands, except share and per share data)(Unaudited)

June30, December31, 2020 2019 Assets Current assets: Cash and cash equivalents $ 112,673 $ 1,009 Marketable debt securities 1,011 ? Prepaid expenses and other current assets 5,427 3,741 Total current assets 119,111 4,750 Property and equipment, net 675 274 Operating lease right-of-use assets 4,252 87 Restricted cash 1,339 ? Other assets 80 90 Total assets $ 125,457 $ 5,201 Liabilities and Stockholders? Equity (Deficit) Current liabilities: Accounts payable $ 2,258 $ 3,539 Accrued expenses 3,796 2,259 Operating lease liabilities, current 591 97 Total current liabilities 6,645 5,895 Operating lease liabilities 6,268 ? Total liabilities 12,913 5,895 Stockholders? equity: Preferred stock; $0.001 par value per share;5,000,000 shares authorizedas of June 30, 2020and December 31, 2019; no shares issued ? ? andoutstanding as of June 30, 2020 and December31, 2019Common stock, $0.001 par value per share;115,000,000 sharesauthorized as of June 30,2020 and December 31, 2019; 15,356,206 15 6 and6,091,250 shares issued and outstanding asof June 30, 2020 andDecember 31, 2019,respectivelyAdditional paid-in capital 153,668 22,432 Accumulated deficit (41,136 ) (23,132 )Accumulated other comprehensive loss (3 ) ? Total stockholders? equity (deficit) 112,544 (694 )Total liabilities and stockholders? equity $ 125,457 $ 5,201 (deficit)

LARIMAR THERAPEUTICS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(In thousands, except share and per share data) (Unaudited)

Three Months Ended June30, Six Months Ended June30, 2020 2019 2020 2019 Revenue $ ? $ ? $ ? $ ? Operating expenses:Research and 8,907 3,128 13,914 7,350 developmentGeneral and 2,492 576 4,159 1,078 administrativeTotal operating 11,399 3,704 18,073 8,428 expensesLoss from (11,399 ) (3,704 ) (18,073 ) (8,428 )operationsOther income, 69 ? 69 ? netNet loss $ (11,330 ) $ (3,704 ) $ (18,004 ) $ (8,428 )Net loss pershare, basic $ (1.21 ) $ (0.61 ) $ (2.33 ) $ (1.38 )and dilutedWeightedaverage commonshares 9,381,412 6,091,250 7,736,331 6,091,250 outstanding,basic anddiluted