Artelo Biosciences, Inc. Common Stock H.C. Wainwright 28th Annual Global Investment Conference

Thank you very much, and it is great to be back at the H.C. Wainwright Conference this year. For those of you who are joining by the webcast, welcome, and those that I will meet with you in person during the conference, I am looking forward to those conversations. Today, I will be presenting our corporate presentation about our pioneering lipid signaling modulation, and we are traded under the NASDAQ under the symbols ARTL. I am Greg Gorgas, the founding CEO of the company. I will be making some forward-looking statements today. I would invite you to please go to our website where all of our filings are current and linked on our website under the Investors tab at artelobio.com. During this presentation, I am going to introduce, for those of you who are not familiar with Artelo, a little bit about the company.

We are a clinical-stage biopharmaceutical company, and we have a large platform of lipid signaling modulation drug candidates. I will focus in on three of those today and talk to you about our novel science. I will share with you the near-term catalysts or milestones that are upcoming. All of our assets are focused in on billion-dollar market opportunities that are underpinned with a very robust patent estate. I will share a little bit, time permitting, about the proven leadership team that is with me at Artelo Biosciences. As a quick overview, this is a snapshot of our three assets that I would like to share with you today. Those three assets, two are in-licensed, and one is our own invention. The first asset is a dual cannabinoid receptor agonist. We call that ART27.13. If you like nicknames, you can just name it 13.

That was originally developed at AstraZeneca, and we licensed this in the worldwide rights in all fields at Artelo. The second asset that we will discuss, nicknamed 12 now, is ART26.12. That is a fatty acid binding protein 5 inhibitor. That came to us through Stony Brook University. Last but not least, 11, nicknamed or ART12.11, is our co-crystal of cannabidiol and tetramethylpyrazine that is in the preclinical. The other two assets are in clinical stage, and we will focus most of our time on those assets. Let us talk a little bit about ART27.13. This is that dual cannabinoid agonist that we have in development phase II for cancer anorexia. You might think, "Oh, I do not really know a lot about cancer anorexia," or, "I have not heard about it." But anybody that has been through the cancer journey does.

Anybody that's been as a caregiver of somebody in the cancer journey does. Or if you can just close your eyes and think about Steve Jobs or Patrick Swayze or anybody else that you've known going or have seen on the internet or on television that has gone through the cancer journey. You can see them losing a tremendous amount of weight, and if they're destined to be treated, they need the energy to fight in their cancer. If they're not, they should pass through this experience with dignity. There is nothing FDA-approved to treat cancer anorexia today. Nothing actually approved in the U.K., nothing actually approved in Europe. It is really a global unmet need that we're trying to address. This is the molecule ART27.13. It's a synthetic dual cannabinoid 1, cannabinoid 2 full agonist. We dose it once daily, orally.

It's a made-up drug, meaning it was invented at AstraZeneca. It does not mimic something in the cannabis plant. I want to be very clear about that, but it does target the same receptors that, for example, THC, which is a weak agonist, targets in the body. It doesn't mimic THC, but it does target the same receptors that THC targets. But in contrast to, let's say, THC, it avoids the CNS side effects by being peripherally selective or preferential to the periphery.

It does leverage a well-known pathway, and that is around lunchtime, if you're watching this around lunchtime, you probably grabbed your gut region or your tummy and said, "I'm hungry." That's because their gut region is filled with these cannabinoid receptors, and it sends a signal through the vagus afferent nerve to the brain, "Feed me, I'm hungry." The drug doesn't have to travel to the brain. The drug actually needs to go to the targets in the gut region that sends the signal to the brain, and that's what our drug is believed to do. We are very excited to share with you data from our CARES or Cancer Appetite Recovery Study. The schema for the trial is listed here on the slide in front of you. The phase I is completed.

About 27 patients participated or were enrolled in that, in four doses on a dose escalation protocol. I can just summarize the data which we previously put out in former corporate decks, but about a third of the people at those doses continued to lose weight, about a third were stabilized, and a third gained weight. Again, the purpose of the phase I was to establish safety. It wasn't primarily to look at efficacy. But even at these low or subtherapeutic doses, still two-thirds of the people either stabilized or gained weight, and these were all people that had lost weight going into the trial.

What I wanted to focus on today, though, is showing you data from our interim phase II data release. That is where we started from the phase I at that lowest dose, 650 micrograms, elevated after a month to 1,000, and then to 1,300 micrograms for those patients that were on that protocol. This was over 3 months or 12 weeks that patients received the drug. They were randomized either to placebo or to receive active drug on this dose escalation protocol. We looked at lean body mass, weight gain, obviously, physical activity, because it is no sense to eat potato chips or Oreos on the couch if you cannot enjoy life and experience with your family, or make it to the doctor's office and receive your chemotherapy or biologic therapy to treat your cancer. We looked at anorexia or the loss of appetite, quality of life, and safety.

Let me share with you a little bit quickly about safety. Safety, like I said, was assessed in the phase I. 27 people participated. There were no serious adverse effects. There was some somnolence or drowsiness in 11% and dry mouth in 11%. You can see there is a lot of zeros on the table on the left-hand side of your slide there. On the right-hand side, you can see that the adverse events, there were, again, no serious adverse events. Remember, we dosed now up to 1,300 micrograms. The safety profile observed in the phase II was very similar to that of the phase I. We would characterize this as very well tolerated, and the physicians that enrolled patients would say the exact same thing.

Let us take a look now at how the trial is thought of and what took place. Then I am going to show you one more slide on the activity of the drug in the next slide. In order to get into the trial, you had to have documented weight loss of at least 5% over the last 6 months. What do you do when you go to the doctor's office? The first thing I still do is step on the scale. They do not do my height so much anymore. They all tell me to step on the scale. These patients had documented weight loss of at least 5% over the last 6 months. Then they are enrolled into the study. Again, over a 3-month or 12-week period, the patients are put into the dose escalation protocol in the phase II.

There is a safety washout period at the end where we assess safety. I think you can easily see by the slides that the patients that were on active drug gained weight. Those that were on placebo lost weight. At the end of the treatment, people started to go back to losing weight once they were off of the drug. Let us look at that a little bit more specifically on the left-hand side of your slide here. I think the real key message is what you can read at the bottom. At the end of treatment, there was an average of 6% weight gain in those patients receiving active drug that went up to the 1,300 microgram dose. Just for context, again, you had to lose 5%, or in my case, that would be about 10 pounds over the last 6 months.

If I were on this trial and on active drug and had gone to the 1,300 microgram dose, I would have gained 12 pounds back. That is more than I actually lost in the last six months being treated for these last three months. Unfortunately, for those randomized to placebo, they continued to lose weight and lost an additional 5%. It is the difference in me weighing 202 pounds or being down to 180. I think that you can all agree that that is a very, very profound treatment effect. It is among the best that has ever been shown with a drug trying to treat cancer anorexia. I have been in the pharmaceutical industry for now four decades, always in the cancer space, and familiar with drugs that have tried to address this very big unmet need.

Importantly, on the right-hand side of the slide, you can see that the activity for those that were on active drug also was increased in frequency, in duration, and intensity. It is very exciting to see, and this is because all the patients wore what we call an FDA-validated instrument. It is called a MotionWatch. You can think of it like a Fitbit or your Apple Watch, where it measures. Unlike your Apple Watch, it does not tell you to get up and breathe and do activity, but it does measure those activities, which is downloaded at the hospital or the physician's office. We were able to see all their daily activity over that three-month period.