Faron Pharmaceuticals: Inside Information: Faron Pharmaceuticals Ltd is planning a rights offering of approximately EUR 40 million to strengthen its capital structure and to drive lead asset bexmarilimab to key milestones

Faron Pharmaceuticals OyAnnouncement

09/02/2026 17:45

Faron Pharmaceuticals Ltd | Company announcement | February 09, 2026 at
19:35:00 EET

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Inside Information: Faron Pharmaceuticals Ltd is planning a rights offering of
approximately EUR 40 million to strengthen its capital structure and to drive
lead asset bexmarilimab to key milestones

TURKU, FINLAND – Faron Pharmaceuticals Ltd. (AIM: FARN, First North: FARON,
“Faron” or the “Company”) announces that it is planning a share issue with
pre-emptive subscription rights for the Company's existing shareholders to
raise gross proceeds of approximately EUR 40 million (the “Offering”) The
Offering is aimed to strengthen the Company's financial position and to
accelerate the development of its lead asset bexmarilimab and to run the Phase
II portion of the FDA agreed Phase II/III trial in frontline HR MDS. To seek
shareholders' approval for the Offering, Faron will today publish a notice to
convene an Extraordinary General Meeting of Shareholders (EGM), to be held on
2 March 2026.

Key Highlights

* The objective of the Offering is to strengthen the Company's financial
  position and to finance the continued development of the Company’s lead
  asset bexmarilimab to the next set of key clinical milestones and expected
  value inflection points for 2026 and 2027.
* Faron intends to raise approximately EUR 40 million in the Offering. The net
  proceeds from the Offering will be used to fund the Phase II portion of the
  Phase II/III trial agreed with the U.S. Food and Drug Administration (FDA)
  testing bexmarilimab + azacitidine against placebo + azacitidine in
  frontline high risk myelodysplastic syndrome (HR MDS), along with several
  investigator‐initiated combination trials across multiple cancers.
* To align its clinical development plan with the recent FDA MDS guidelines
  from 2025, Faron plans to propose Complete Response (CR) as the approval
  endpoint, which would substantially shorten the confirmatory Phase III trial
  duration.
* Faron believes that its staged and cost-efficient clinical development plan
  adapts well to the recent evolution in the HR MDS competitive landscape,
  particularly the failure of certain other drug candidates due to their
  clinical trial design and/or safety concerns.
* Faron will host a virtual Business Update
  (https://faron.videosync.fi/business-update-02-2026/register) on Wednesday,
  11 February 2026 at 3pm EET / 2pm CET / 8am ET. During the event, Faron’s
  Chief Executive Officer, Dr. Juho Jalkanen, will provide an update on the
  Company’s development plans and the rationale behind the planned Offering.

Background for the Offering

Faron has reached a critical stage in the advancement of bexmarilimab. In
order to position the Company to achieve the next expected key
value-inflection milestones, Faron’s Board of Directors has undertaken a
detailed review of the development plan of bexmarilimab and forecasted funding
requirements. With the proposed Offering Faron aims to fund the Phase II
portion of a Phase II/III registrational trial of bexmarilimab in frontline
high risk myelodysplastic syndrome (HR MDS) that was agreed with the FDA in H2
2025, along with supporting several investigator‐initiated combination trials
across multiple solid tumors.

Chairman statement

“The Board has carefully considered a range of financing alternatives,
including non-dilutive funding, debt instruments and equity-linked structures
to fund the development of bexmarilimab. Having taken into account the
Company’s development stage, market conditions and the importance of reaching
a flexible balance sheet, we have concluded that equity financing by way of a
rights offering is the most appropriate and prudent course of action at this
time for the Company and its shareholders. We have therefore decided to
convene the EGM to seek authorization from the shareholders for the Offering.
The Board considers that a rights offering, offered to existing shareholders
on a pre-emptive basis, represents a fair and equitable means of raising
capital, allowing shareholders the opportunity to participate in the financing
in proportion to their existing shareholdings and to mitigate dilution should
they choose to do so. Accordingly, the Board unanimously believes that the
rights offering is in the best interests of the Company and its shareholders
as a whole and is necessary to support the execution of the Company’s strategy
and the creation of long-term shareholder value, as this funding will enable
the Company to facilitate progress toward multiple near-term clinical and
regulatory milestones.

We trust that our shareholders will support the resolution to be proposed at
the EGM to enable the planner rights offering to proceed,” says Tuomo Pätsi,
the Chair of the Board.

Bexmarilimab’s clinical development plan aligned with FDA guidance and recent
competitive landscape evolutions

Faron plans to start in the second half of 2026 the Phase II part of the
randomized Phase II/III trial comparing two doses of bexmarilimab versus
placebo, all in combination with standard-of-care azacitidine. At the end of
the Phase II, anticipated late 2027, Faron aims to unblind the Phase II data
and request an FDA meeting to select the final dose and primary endpoint for
the confirmatory Phase III part. In the second half of 2025, the FDA published
the first MDS guidelines for the industry. Accordingly, Faron intends to
propose Complete Response (CR) as the final approval endpoint, which is
expected to substantially shorten the confirmatory Phase III trial duration
and cost. Of note, at the time of the frontline Phase II readout a discussion
concerning accelerated approval for relapsed and refractory MDS (r/r MDS)
could be re-visited with the FDA if the frontline Phase II results adequately
address the FDA’s question on contribution of each agent in the efficacy of
the bexmarilimab + azacitidine combination.

Faron believes that its staged and cost-efficient clinical development plan is
appropriately aligned with recent changes in the HR MDS competitive landscape,
particularly the failure of certain other drug candidates due to their
clinical trial design and/or safety concerns.

As Faron continues to advance its frontline development plan and addressing
the FDA’s remaining question on contribution of each agent testing
bexmarilimab + azacitidine against placebo + azacitidine, investigators from
the BEXMAB Phase I/II trial believe that the benefit of bexmarilimab in r/r
MDS is clear given the data produced to date in the BEXMAB trial. Hence, led
by City of Hope (USA) an investigator-initiated trial (IIT) in r/r MDS is also
planned to commence in 2026 to produce more data in the last line setting
while Faron pursues the frontline setting. This IIT data in r/r MDS is planned
to be used for further validation of the benefit of bexmarilimab in last line
HR MDS and support the discussion by Faron of potential accelerated approval
in r/r MDS with the FDA at the time of the frontline Phase II read out.

Faron also plans to support up to five investigator-initiated trials to
further validate bexmarilimab’s potential in combination trials in melanoma,
lung cancer (NSCLC), soft tissue sarcoma, breast cancer (ER+ BRC) and leukemia
(AML). The Company believes that these additional trials can further
strengthen and expand the potential of bexmarilimab in solid tumors, which it
expects to increase bexmarilimab’s attractiveness for a potential commercial
partnership with biopharmaceutical companies on a global basis.

Dr. Juho Jalkanen, CEO and co-founder of Faron said: “We have now reached an
important milestone with bexmarilimab, achieving deep and durable responses as
well as favorable safety profile in HR MDS where lack of new treatments has
prevailed. We remain convinced that bexmarilimab has potential to become the
next standard of care in HR MDS and possible other indications, and we are
confident that our clinical development plan is well designed to address the
needs of patients with high unmet medical need.”

Extraordinary General Meeting

Faron intends to raise approximately EUR 40 million in equity capital, which
is expected to fund the Phase II portion of the Phase II/III trial agreed with
the FDA testing bexmarilimab + azacitidine against placebo + azacitidine in
frontline HR MDS, along with several investigator‐initiated combination trials
across multiple cancers. The remainder of the funds would support working
capital needs and general corporate purposes for the Company.

The Offering is subject to an authorization by shareholders at the
Extraordinary General Meeting (EGM) and a resolution by the Board of Directors
of Faron Pharmaceuticals Ltd.

Faron seeks an authorization for the Offering in the EGM of Faron
Pharmaceuticals Ltd, which is to be held on 2 March 2026. Preliminarily and
depending on the market conditions, the subscription period for the Offering
is currently expected to commence and end during the first quarter of 2026.
The meeting documents will be made available at the following link:
https://faron.com/investors/governance/general-meeting/

The Company may carry out an additional offering by way of a directed share
issue to allocate shares to potential non-shareholder investors based on
previous authorization granted by the Company’s last general meeting.

Background – bexmarilimab emerging as potential next standard of care in HR
MDS

Faron’s lead asset bexmarilimab is an investigational immunotherapy designed
to overcome resistance to existing cancer treatments by harnessing the power
of immune cells and igniting the immune system.

The mechanism of action of bexmarilimab consists of reprogramming immune cells
called macrophages, which are a key source of treatment resistance to cancer,
helping tumor cells evade the immune system. This mechanism of action triggers
the immune system to attack tumors and sensitizes cancer cells to
chemotherapies as well as other classical cancer drugs.

Based on the strength of data already generated with bexmarilimab, Faron has
been granted Orphan Drug Designation and Fast Track Designation for the
treatment of the difficult-to-treat blood cancer called high-risk
myelodysplastic syndrome (HR MDS) by the FDA, as well as Orphan Drug
Designation by the European Medicines Agency (EMA).

The updated Phase I/II BEXMAB study data presented at the American Society of
Hematology (ASH) 2025 Annual Meeting in December 2025 highlighted significant
improvement in survival outcomes in patients with HR MDS treated
with bexmarilimab in combination with standard-of-care azacitidine, suggesting
the combination could effectively bridge to a potentially curative therapy in
this otherwise deadly cancer:

* Deep and durable complete remissions (CRs), reaching 70% in most difficult
  to treat patients bearing a genetic mutation called TP53 mutants;
* Durable effect in patients with complete remissions, with a median of 12.1
  months for all and 10.2 months for TP53 mutants and both continuing to
  increase as follow-up mature;
* Deep eradication of cancer cells with 67% of CR patients with no residual
  disease (MRD);
* Meaningful reduction of blood transfusions, with 57% of frontline patients
  that were transfusion dependent becoming transfusion independent; and
* Meaningful survival benefit in patients with resistant or refractory HR MDS,
  last line survival improvement to 14.5 months compared to 5-6 months,
  historically.

Sole Global Coordinator and Bookrunner
Faron has appointed Stifel Europe Securities SAS as Sole Global Coordinator
and Bookrunner of the Offering.

Webcast

Faron will host a virtual Business Update
(https://faron.videosync.fi/business-update-02-2026/register) on Wednesday, 11
February 2026 at 3pm EET / 2pm CET / 8am ET. During the event, Faron’s Chief
Executive Officer, Dr. Juho Jalkanen, will provide an update on the Company’s
development plans and the rationale behind the planned Offering.

Webcast registration link: https://faron.videosync.fi/business-update-02-2026

For more information, please contact:

+-------------------------------------+--------------------------------------+
| IR Partners, Finland                | +358 50 553 9535 / +44 7 469 766 223 |
| (Media)                             | kare.laukkanen@irpartners.fi         |
| Kare Laukkanen                      |                                      |
+-------------------------------------+--------------------------------------+
| Cairn Financial Advisers LLP        | +44 (0) 207 213 0880                 |
| (Nominated Adviser and Broker)      |                                      |
| Sandy Jamieson, Jo Turner           |                                      |
+-------------------------------------+--------------------------------------+
| Stifel Europe Securities SAS        | pierre.kiecoltwahl@stifel.com        |
| (Sole Global Coordinator and        | +33 6 30 57 58 82                    |
| Bookrunner)                         | vincent.meunier@stifel.com           |
| Pierre Kiecolt-Wahl                 | +33 6 30 56 10 06                    |
| Vincent Meunier                     |                                      |
+-------------------------------------+--------------------------------------+
| Sisu Partners Oy                    | +358 (0)40 555 4727                  |
| (Certified Adviser on Nasdaq First  | +358 (0)50 553 8990                  |
| North)                              |                                      |
| Juha Karttunen                      |                                      |
| Jukka Järvelä                       |                                      |
+-------------------------------------+--------------------------------------+

About BEXMAB
The BEXMAB study is an open-label Phase I/II clinical trial investigating
bexmarilimab in combination with standard of care (SoC) in the aggressive
hematological malignancies of acute myeloid leukemia (AML) and myelodysplastic
syndrome (MDS). The primary objective is to determine the safety and
tolerability of bexmarilimab in combination with SoC (azacitidine) treatment.
Directly targeting Clever-1 could limit the replication capacity of cancer
cells, increase antigen presentation, ignite an immune response, and allow
current treatments to be more effective. Clever-1 is highly expressed in both
AML and MDS and associated with therapy resistance, limited T cell activation
and poor outcomes.

About bexmarilimab
Bexmarilimab is Faron’s wholly owned, investigational immunotherapy designed
to overcome resistance to existing treatments and optimize clinical outcomes,
by targeting myeloid cell function and igniting the immune system.
Bexmarilimab binds to Clever-1, an immunosuppressive receptor found on
macrophages leading to tumor growth and metastases (i.e. helps cancer evade
the immune system). By targeting the Clever-1 receptor on macrophages,
bexmarilimab alters the tumor microenvironment, reprogramming macrophages from
an immunosuppressive (M2) state to an immunostimulatory (M1) one, upregulating
interferon production and priming the immune system to attack tumors and
sensitizing cancer cells to standard of care.

About Faron Pharmaceuticals Ltd
Faron (AIM: FARN, First North: FARON) is a global, clinical-stage
biopharmaceutical company, focused on tackling cancers via novel
immunotherapies. Its mission is to bring the promise of immunotherapy to a
broader population by uncovering novel ways to control and harness the power
of the immune system. The Company’s lead asset is bexmarilimab, a novel
anti-Clever-1 humanized antibody, with the potential to remove
immunosuppression of cancers through reprogramming myeloid cell function.
Bexmarilimab is being investigated in Phase I/II clinical trials as a
potential therapy for patients with hematological cancers in combination with
other standard treatments. Further information is available at www.faron.com.

Important notice
This announcement is not an offer of securities for sale into the United
States. The securities have not been and will not be registered under the
United States Securities Act of 1933, as amended (the "Securities Act"), or
under the securities laws of any state or other jurisdiction of the United
States, and may not be offered, sold or transferred, directly or indirectly,
in or into or from the United States except pursuant to an exemption from, or
in a transaction not subject to, the registration requirements of the
Securities Act and in compliance with any applicable securities laws of any
state or other jurisdiction of the United States. There is no intention to
register the securities in the United States or to make a public offering in
the United States. Any sale of the securities in the United States will be
made solely to a limited number of "qualified institutional buyers" as defined
in Rule 144A in reliance on an exemption from the registration requirements of
the Securities Act.

The distribution of this announcement may be restricted by law and persons
into whose possession any document or other information referred to herein
comes should inform themselves about and observe any such relevant legal
restrictions. The information contained herein is not for publication,
distribution or release, directly or indirectly, in or into the United States,
Australia, Canada, Hong Kong, Japan, New Zealand, Singapore or the Republic of
South Africa or any other jurisdiction in which the distribution, publication
or release would be unlawful. Any failure to comply with these restrictions
may constitute a violation of the securities laws of any such aforementioned
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distribution to or use by, any person or entity that is a citizen, resident or
located in any locality, state, country or other jurisdiction where such
distribution, publication, availability or use would violate law or regulation
or which would require any registration or licensing within such jurisdiction.

In any EEA Member State, other than Finland, this release is only addressed to
and is only directed at "qualified investors" in that Member State within the
meaning of Article 2(e) of Regulation (EU) 2017/1129 (the "Prospectus
Regulation").

In the United Kingdom, this announcement is only directed at (a) members of
the Company; and (b) "qualified investors" within the meaning of paragraph 15
of Schedule 1 of the Public Offers and Admissions to Trading Regulations 2024
(the "POATR")  who are also (i) persons having professional experience in
matters relating to investments who fall within the definition of "investment
professionals" in Article 19(5) of the Financial Services and Markets Act 2000
(Financial Promotion) Order 2005, as amended (the "Order"); (ii) persons who
fall within Article 49(2)(a) to (d) of the Order; or (iii) other persons to
whom it may otherwise be lawfully communicated (all such persons together
being "Relevant Persons"). This announcement must not be acted on or relied on
in the United Kingdom by persons who are not Relevant Persons. Persons
distributing this announcement must satisfy themselves that it is lawful to do
so. Any investment or investment activity to which this announcement relates
is only available to Relevant Persons in the United Kingdom and will only be
engaged in with such persons.

In the United Kingdom, no prospectus, offering memorandum, offering document
or admission document has been or will be made available in connection with
the matters contained or referred to in this announcement and no such document
is required to be published (in accordance with the POATR or the AIM Rules of
the London Stock Exchange). This announcement has not been approved by the
Financial Conduct Authority (the "FCA") or the London Stock Exchange.

No part of this announcement, nor the fact of its distribution, should form
the basis of, or be relied on in connection with, any contract or commitment
or investment decision whatsoever. The information contained in this release
has not been independently verified. No representation, warranty or
undertaking, expressed or implied, is made as to, and no reliance should be
placed on, the fairness, accuracy, completeness or correctness of the
information or the opinions contained herein. The Company or any of its
respective affiliates, advisors or representatives or any other person, shall
have no liability whatsoever (in negligence or otherwise) for any loss,
however arising from any use of this release or its contents or otherwise
arising in connection with this release. Each person must rely on their own
examination and analysis of the Company, its subsidiaries, its securities and
the transactions, including the merits and risks involved.

The Sole Global Coordinator and Bookrunner is acting exclusively for the
Company and no one else in connection with the Offering. It will not regard
any other person as their respective client in relation to the Offering. It
will not be responsible to anyone other than the Company for providing the
duties afforded to its respective clients, nor for giving advice in relation
to the Offering or any transaction or arrangement referred to herein.

Caution regarding forward-looking statements

Certain statements in this announcement are, or may be deemed to be,
forward-looking statements. Forward-looking statements are identified by their
use of terms and phrases such as ''believe'', ''could'', "should", "expect",
''envisage'', ''estimate'', ''intend'', ''may'', ''plan'', ''potentially'',
''will'' or the negative of those, variations or comparable expressions,
including references to assumptions. These forward-looking statements are not
based on historical facts but rather on the Company's current expectations and
assumptions regarding the completion and use of proceeds from the Offering,
the Company's future growth, results of operations, performance, future
capital and other expenditures (including the amount, nature and sources of
funding thereof), competitive advantages, business prospects and
opportunities. Such forward-looking statements reflect the Company's current
beliefs and assumptions and are based on information currently available to
the Company.

A number of factors could cause actual results to differ materially from the
results and expectations discussed in the forward-looking statements, many of
which are beyond the control of the Company. In addition, other factors which
could cause actual results to differ materially include the ability of the
Company to successfully licence its programmes, risks associated with
vulnerability to general economic and business conditions, competition,
environmental and other regulatory changes, actions by governmental
authorities, the availability of capital markets or other sources of funding,
reliance on key personnel, uninsured and underinsured losses and other
factors. Although any forward-looking statements contained in this
announcement are based upon what the Company believes to be reasonable
assumptions, the Company cannot assure investors that actual results will be
consistent with such forward-looking statements. Accordingly, readers are
cautioned not to place undue reliance on forward-looking statements. Subject
to any continuing obligations under applicable law, in providing this
information the Company does not undertake any obligation to publicly update
or revise any of the forward-looking statements or to advise of any change in
events, conditions or circumstances on which any such statement is based