U.S. expansion of antiviral outbreak control trial in long-term care facilities

Favipiravir already approved in India and Russia for emergency use against COVID-19 and as a pandemic influenza antiviral medication in Japan

First oral antiviral that may provide protection for elderly and vulnerable populations without need for intravenous administration or injections

Over 40% of deaths in the United States involve nursing home residents and staff i

Appili Therapeutics Inc. (TSXV: APLI; OTCQX: APLIF) (the “Company” or “Appili”), a biopharmaceutical company focused on anti-infective drug development, today announced that the U.S. Food and Drug Administration (FDA) has granted the Company clearance to proceed after Appili’s filing of an investigational new drug (IND) application for broad-spectrum antiviral favipiravir. Appili is expanding its Phase 2 clinical trial into the U.S. to evaluate the safety and efficacy of favipiravir tablets in controlling outbreaks following exposure to COVID-19 in long-term care (LTC) facilities. Appili’s Phase 2 clinical trial is leveraging the versatility of favipiravir as an oral tablet suitable for administration across a wide variety of care settings, including long-term care. Appili intends to enroll up to 760 participants in this Phase 2 clinical trial across both the U.S. and in Canada. Health Canada provided regulatory clearance on May 21, 2020 for Appili’s Phase 2 study evaluating FUJIFILM Toyama Chemical’s (FFTC) favipiravir as a preventative measure against COVID-19 outbreaks.

“The burden of illness in long-term care centers continues to be a significant problem, and finding ways to offer LTC residents and staff protection against COVID-19 with an oral treatment would be a significant advance in our fight to control the devastating effects of this pandemic,” said Dr. Armand Balboni, Chief Executive Officer at Appili Therapeutics. “The limited response to vaccines often seen in the elderly further supports expanding this trial into the U.S. Favipiravir is an antiviral that can be administered orally as a tablet, without the need to be given intravenously or as injections, and may be an important option to avoid and/or control outbreaks in elderly residents living in LTC facilities.”

“The elderly are at the highest risk for contracting the disease and the rising rates of COVID-19 infection currently seen in much of the U.S. will likely continue to be a major threat to those living and working in long-term care facilities,” said Primary Investigator Dr. Allison McGeer, senior clinician scientist at the Lunenfeld-Tanenbaum Research Institute at Sinai Health. “Through the means of a randomized control clinical trial, our team is looking forward to working with clinical partners in the U.S. to understand if favipiravir could be an option for outbreak control in this setting.”

Favipiravir was originally developed and approved in Japan as a treatment and stockpile countermeasure for pandemic influenza outbreak under the name AVIGAN. Following promising clinical studies, Russia and India recently approved favipiravir-based antiviral medications for the emergency treatment of COVID-19.ii iii Researchers are conducting additional trials evaluating favipiravir as a treatment for COVID-19 in countries including the United States, Japan, China, and the United Kingdom.

The Company is not making any express or implied claims that it has the ability to eliminate, cure or contain the Covid-19 (or SARS-2 Coronavirus) at this time.

About Appili Therapeutics

Appili Therapeutics Inc. was founded to advance the global fight against infectious disease by matching clearly defined patient needs with drug development programs that provide solutions to existing challenges patients, doctors, and society face in this critical disease space. Appili has built a pipeline of assets designed to address a broad range of significant unmet medical needs in the infectious disease landscape. This diverse pipeline aims to address some of the most urgent threats in global public health, including ATI-2307, a novel, broad spectrum, clinical-stage antifungal candidate in development for severe and difficult-to-treat invasive fungal infections; ATI-1701, a vaccine candidate for tularemia, a very serious biological weapons threat; ATI-1503, a drug discovery program aimed at generating a novel class of antibiotics with broad-spectrum activity against Gram-negative superbugs; and ATI-1501, which employs Appili’s proprietary, taste-masked, oral-suspension technology with metronidazole for the growing number of patients with difficulty swallowing. In addition, the Company is also testing FUJIFILM Toyama Chemical Inc.’s drug favipiravir for the prevention of COVID-19 as a potential prophylaxis treatment. Headquartered in Halifax, Nova Scotia, with offices in Toronto, Ontario, Appili is pursuing worldwide opportunities in collaboration with scientific and industry commercial partners, governments and government agencies. For more information, visit www.AppiliTherapeutics.com.

Forward looking statements

This news release contains “forward-looking statements,” which reflect the current expectations of the Company’s management for future growth, results of operations, performance and business prospects and opportunities, including statements with respect to: the scope and parameters of the proposed clinical trial in Canada and the U.S. and the likelihood that such clinical trial will be consummated on the terms and timeline provided herein or at all; and the potential use of favipiravir for the treatment of COVID-19 (including as a method of outbreak control in long-term care facilities). Wherever possible, words such as “may,” “would,” “could, “ “should,” “will,” “anticipate,” “believe,” “plan,” “expect,” “intend,” “estimate,” “potential for” and similar expressions have been used to identify these forward-looking statements. Forward looking statements contained in this press release are provided in reliance on certain assumptions, including with respect to: securing all requisite required approvals and funding for the clinical trial in Canada and the U.S.; finalizing a mutually acceptable clinical trial agreement and related agreements with the applicable clinical research organizations relating to this clinical trial; patient enrolment; and other expectations and assumptions concerning the proposed clinical trial in Canada and the U.S. (including with respect to potential outcomes and benefits). Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, the Company cannot give assurance that these expectations will prove to have been correct.

Forward-looking statements involve significant known and unknown risks, uncertainties and assumptions, including, without limitation, economic, competitive, political and social uncertainties; known and unknown risks and liabilities relating to the ongoing COVID-19 pandemic; risks relating to the inability of Appili to secure any requisite rights to manufacture and commercialize favipiravir in Canada, the U.S and other jurisdictions on favourable terms or at all; unforeseen events, developments, or factors causing any of the aforesaid expectations and assumptions not to be correct; and the other risk factors listed in the annual information form of the Company dated June 24, 2020 and the other filings made by the Company with the Canadian securities’ regulatory authorities (which may be viewed at www.sedar.com). Should one or more of these risks or uncertainties materialize or should assumptions underlying the forward-looking statements prove incorrect, actual results, performance or achievements may vary materially from those expressed or implied by the forward-looking statements contained in this news release. These factors should be considered carefully, and prospective investors should not place undue reliance on the forward-looking statements. The Company disclaims any intention or obligation to revise forward-looking statements whether as a result of new information, future developments or otherwise, except as required by law.

Neither the TSX Venture Exchange, nor its regulation services provider (as that term is defined in the policies of the exchange), accepts responsibility for the adequacy or accuracy of this release.

_________________ i The New York Times: More Than 40% of U.S. Coronavirus Deaths Are Linked to Nursing Homes ii RDIF and ChemRar announce first interim results of clinical trials of Favipiravir drug’s effectiveness in coronavirus therapy iii Glenmark Becomes the First Pharmaceutical Company in India to Receive Regulatory Approval for Oral Antiviral Favipiravir, for the Treatment of Mild to Moderate COVID-19

Media Relations Contact: Canadian Media: Chantal Allan Sam Brown Inc. T: 613-319-4384 (CAN) T: 805-242-3080 (U.S.) E: chantalallan@sambrown.com

US/Trade Media: Andrea Cohen Sam Brown Inc. T: 917-209-7163 E: andreacohen@sambrown.com

Investor Relations Contact: Kimberly Stephens, CFO Appili Therapeutics Inc. TSXV: APLI E: Info@AppiliTherapeutics.com

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