Corneal defect

-- Patient enrollment ongoing in Phase 2b CHASE trial of KPI-012 for PCED; targeting topline data by year-end 2024 -- -- Evaluating opportunities to expand KPI-012 development into other corneal diseases, including LSCD and to explore KPI-014 in rare inherited retinal diseases -- -- Cash resources of $48.5 million as of March 31, 2024 together with anticipated funding remaining from CIRM award expected to fund operations into 3Q 2025 -- ARLINGTON, Mass., May 14, 2024 (GLOBE NEWSWIRE) -- KALA BIO, Inc. (NASDAQ:KALA), a clinical-stage biopharmaceutical company dedicated to the research, development and commercialization of innovative therapies for rare and severe diseases of the eye, today reported financial results for the first quarter ended March 31, 2024 and provided a corporate update. “In 2024, we are acutely focused on advancing our clinical program for KPI-012 in PCED, a rare, devastating disease caused by an array of underlying etiologies, many of which cannot be treated with currently approved therapeutic options,” said Mark Iwicki, Chair and Chief Executive Officer of KALA BIO. “Given its multifactorial mechanism of action and based on clinical data to-date, we believe KPI-012 has the potential to address the multiple impaired corneal healing processes that cause PCED and provide patients a well-tolerated, easily administered and effective therapy. We are targeting topline data from our ongoing Phase 2b CHASE trial by year end which, if successful, could serve as the first of two pivotal trials required to support a BLA submission.” Mr. Iwicki continued, “In parallel, we remain committed to exploring the potential of our platform technology more broadly, as we work to establish KALA as a leader in the emerging field of mesenchymal stem cell secretome therapy. We believe KPI-012 represents a pipeline-in-a-product opportunity and plan to leverage our investigational new drug-enabling activities in PCED to support follow-on indications across a range of corneal diseases, while also exploring the potential for KPI-014, our second asset, across a range of rare, inherited retinal diseases.” First Quarter and Recent Business Highlights: KALA is advancing an innovative pipeline based on its proprietary mesenchymal stem cell secretome (MSC-S) platform. KALA believes the multifactorial mechanism of action of its MSC-S platform technology may enable it to generate products for a range of ocular orphan diseases and is evaluating the potential development of this technology for multiple rare, front- and back-of-the-eye diseases. KALA’s lead product candidate, KPI-012 combines growth factors, protease inhibitors, matrix proteins and neurotrophic factors to potentially correct the impaired corneal healing that is an underlying etiology of multiple severe ocular diseases. KALA is initially developing KPI-012 for the treatment of persistent corneal epithelial defect (PCED), a persistent, non-healing corneal defect or wound that is refractory to conventional treatments which, if left untreated, can lead to significant complications, including infection, corneal perforation/scarring and vision loss. PCED has an estimated incidence of approximately 100,000 patients in the U.S. and we believe represents a sizeable market opportunity; there are currently no U.S. Food and Drug Administration (FDA)-approved prescription products with a broad indication for all underlying etiologies of PCED. KALA continues to enroll patients in the CHASE (Corneal Healing After SEcretome therapy) Phase 2b clinical trial evaluating KPI-012 for the treatment of PCED, and are targeting the announcement of topline data by year-end 2024. Contingent on positive results and subject to discussion with regulatory authorities, the Company believes the CHASE Phase 2b trial could potentially serve as the first of two pivotal studies to support the submission of a Biologics License Application (BLA) to the FDA.KALA is also exploring the potential of KPI-012 for additional rare, front-of-the-eye diseases, including Limbal Stem Cell Deficiency (LSCD) and other corneal diseases. LSCD is characterized by the loss or deficiency of limbal epithelial stem cells, which can result in recurrent epithelial breakdown, neovascularization, conjunctivalization, inflammation and other sequalae that can lead to loss of corneal clarity and vision impairment. Like PCED, LSCD represents a substantial market opportunity, with an estimated incidence of 100,000 patients in the U.S. KPI-014, KALA’s preclinical program to evaluate the utility of its MSC-S platform for inherited retinal degenerative diseases, contains neurotrophic factors, growth factors, anti-inflammatory or immune-modulatory factors and antioxidant inhibitors with the potential to protect and preserve retinal cell function. Secretomes have demonstrated a neuroprotective effect in both in vitro and in vivo models of retinal degeneration. KALA believes KPI-014 could offer a gene-agnostic approach for the treatment of rare inherited retinal diseases and has initiated preclinical studies to evaluate the utility of KPI-014 for conditions such as Retinitis Pigmentosa and Stargardt Disease. Financial Results: Cash Position: As of March 31, 2024, KALA had cash and cash equivalents of $48.5 million, compared to $50.9 million as of December 31, 2023. This decrease reflects cash used in operations, partially offset by gross proceeds of $8.6 million received from KALA’s March 2024 private placement financing. Based on its current plans, KALA anticipates that its cash resources as of March 31, 2024, together with anticipated funding under the CIRM award, will enable it to fund operations into the third quarter of 2025. First Quarter 2024 Financial Results: G&A Expenses: For the quarter ended March 31, 2024, general and administrative (G&A) expenses were $5.4 million, compared to $6.0 million for the same period in 2023. The decrease was primarily due to a decrease in administrative and professional service fees, partially offset by an increase in stock-based compensation costs and employee related costs.R&D Expenses: For the quarter ended March 31, 2024, research and development (R&D) expenses were $6.4 million, compared to $4.0 million for the same period in 2023. The increase was primarily due to an increase in KPI-012 development costs and employee-related costs, as we advance the clinical development of KPI-012, and an increase in other research and development costs.Gain on Fair Value Remeasurement of Deferred Purchase Consideration: For the quarter ended March 31, 2024, there was no gain or loss on fair value remeasurement of deferred purchase consideration, in connection with the acquisition of Combangio. For the same period in 2023, there was a gain of $0.2 million.Loss on Fair Value Remeasurement of Contingent Consideration: For the quarter ended March 31, 2024, the loss on fair value remeasurement of continent consideration, in connection with the Combangio acquisition, was $0.2 million, compared to a loss of $1.8 million for the same period in 2023.Operating Loss: For the quarter ended March 31, 2024, loss from operations was $11.9 million, compared to $11.7 million for the same period in 2023.Net Loss: For the quarter ended March 31, 2024, net loss was $11.8 million, or $4.20 per share, compared to a net loss of $14.5 million, or $6.99 per share, for the same period in 2023. The weighted average number of shares used to calculate net loss per share was 2.8 million for the quarter ended March 31, 2024, and 2.1 million for the quarter ended March 31, 2023. About KALA BIO, Inc. KALA is a clinical-stage biopharmaceutical company dedicated to the research, development and commercialization of innovative therapies for rare and severe diseases of the eye. KALA’s biologics-based investigational therapies utilize KALA’s proprietary mesenchymal stem cell secretome (MSC-S) platform. KALA’s lead product candidate, KPI-012, is a human MSC-S, which contains numerous human-derived biofactors, such as growth factors, protease inhibitors, matrix proteins and neurotrophic factors that can potentially correct the impaired corneal healing that is an underlying etiology of multiple severe ocular diseases. KPI-012 is currently in clinical development for the treatment of persistent corneal epithelial defect (PCED), a rare disease of impaired corneal healing, for which it has received Orphan Drug and Fast Track designations from the U.S. Food and Drug Administration. KALA is also targeting the potential development of KPI-012 for the treatment of Limbal Stem Cell Deficiency and other rare corneal diseases that threaten vision and has initiated preclinical studies to evaluate the potential utility of its MSC-S platform for retinal degenerative diseases, such as Retinitis Pigmentosa and Stargardt Disease. For more information on KALA, please visit www.kalarx.com. Forward Looking Statements: This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve substantial risks and uncertainties. Any statements in this press release about KALA’s future expectations, plans and prospects, including but not limited to statements about KALA’s expectations with respect to potential advantages of KPI-012 and its MSC-S platform; the clinical utility of KPI-012 for PCED; anticipated timelines to report topline data for the CHASE Phase 2b clinical trial of KPI-012; KALA’s belief that the Chase Phase 2b trial could serve as the first of two pivotal trials required to support the submission of a BLA to the FDA; KALA’s plans to pursue research and development of KPI-012 and its MSC-S platform for other indications; expectations about the potential benefits and future operation of the CIRM award; KALA’s ability to achieve the specified milestones and obtain the full funding under the CIRM award; the sufficiency of KALA’s existing cash resources for the period anticipated; and other statements containing the words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “likely,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would,” and similar expressions constitute forward-looking statements. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: KALA’s ability to comply with the requirements under the CIRM award; uncertainties inherent in the initiation and conduct of preclinical studies and clinical trials; uncertainties regarding availability and timing of data from clinical trials; whether results of early clinical trials or trials in different disease indications will be indicative of the results of ongoing or future trials; whether results of the Phase 1b clinical trial of KPI-012 will be indicative of results for any future clinical trials and studies of KPI-012, including the CHASE Phase 2b clinical trial; whether interim data from a clinical trial will be predictive of the results of the trial; uncertainties associated with regulatory review of clinical trials and applications for marketing approvals; KALA’s ability to retain and hire key personnel; KALA’s ability to comply with the covenants under its loan agreement, including the requirement that its common stock continue to be listed on The Nasdaq Stock Market; the sufficiency of cash resources and need for additional financing and other important factors, any of which could cause KALA’s actual results to differ from those contained in the forward-looking statements, discussed in the “Risk Factors” section of KALA’s Annual Report on Form 10-K, most recent Quarterly Report on Form 10-Q and other filings KALA makes with the Securities and Exchange Commission. These forward-looking statements represent KALA’s views as of the date of this press release and should not be relied upon as representing KALA’s views as of any date subsequent to the date hereof. KALA does not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Financial Tables: KALA BIO, Inc.Balance Sheet Data(in thousands)(unaudited) March 31, December 31, 2024 2023Cash and cash equivalents$48,478 $50,895 Total assets 53,033 55,949 Working capital (1) 38,208 44,524 Long-term debt, net of discounts 28,510 34,190 Other long-term liabilities 5,983 5,909 Total stockholders’ equity 6,661 7,504 (1)The Company defines working capital as current assets less current liabilities. See the Company's consolidated financial statements for further information regarding its current assets and current liabilities. KALA BIO, Inc. Consolidated Statement of Operations (In thousands, except share and per share data) (Unaudited) Three Months Ended March 31, 2024 2023 Costs and expenses: General and administrative$5,422 $6,030 Research and development 6,351 4,036 Gain on fair value remeasurement of deferred purchase consideration — (230)Loss on fair value remeasurement of contingent consideration 158 1,847 Total operating expenses 11,931 11,683 Loss from operations (11,931) (11,683)Other income (expense): Interest income 504 675 Interest expense (1,455) (1,474)Grant income 1,075 — Other (expense) income, net — (1,973)Net loss$(11,807) $(14,455)Net loss per share attributable to common stockholders—basic and diluted$(4.20) $(6.99)Weighted average shares outstanding—basic and diluted 2,813,210 2,069,186 Investor Contact: Hannah Deresiewicz hannah.deresiewicz@sternir.com 212-362-1200

-- Advancing ongoing Phase 2b CHASE trial of KPI-012 for PCED; topline data targeted by year-end 2024 ---- Exploring opportunities to expand KPI-012 into additional corneal indications ---- Cash resources as of December 31, 2023, together with proceeds from the March 2024 private placement and anticipated funding remaining from CIRM award, expected to fund operations into 3Q 2025 -- ARLINGTON, Mass., March 29, 2024 (GLOBE NEWSWIRE) -- KALA BIO, Inc. (NASDAQ:KALA), a clinical-stage biopharmaceutical company dedicated to the research, development and commercialization of innovative therapies for rare and severe diseases of the eye, today reported financial results for the fourth quarter and full year ended December 31, 2023 and provided a corporate update. “In 2023, we focused on clinical execution, advancing our Phase 2b CHASE trial of KPI-012 for the treatment of PCED. In March 2023, we announced positive safety data from the first cohort of patients, reinforcing the promising safety and tolerability profile of high dose KPI-012, and allowing us to progress into the multicenter, randomized, double-masked efficacy cohort, which we are targeting to read out by year-end 2024,” said Mark Iwicki, Chair and Chief Executive Officer of KALA BIO. “Based on its multifactorial mechanism of action, we believe KPI-012 may address a significant unmet need, potentially offering patients and physicians a highly differentiated product profile and the first therapy for PCED that addresses the multiple underlying etiologies of the disease. We look forward to topline data from the CHASE trial, as we work to establish KPI-012 as a safe, well-tolerated, easily administered and effective treatment for the nearly 100,000 patients living with PCED in the U.S.” Fourth Quarter and Recent Business Highlights: Development-Stage Pipeline:KALA is advancing an innovative pipeline based on its proprietary mesenchymal stem cell secretome (MSC-S) platform. KALA believes the multifactorial mechanism of action of its MSC-S platform technology may enable it to generate products for a range of ocular orphan diseases and is evaluating the potential development of this technology for multiple rare, front- and back-of-the-eye diseases. KPI-012 combines growth factors, protease inhibitors, matrix proteins and neurotrophic factors to potentially correct the impaired corneal healing that is an underlying etiology of multiple severe ocular diseases. KALA is initially developing KPI-012 for the treatment of persistent corneal epithelial defect (PCED), a persistent, non-healing corneal defect or wound that is refractory to conventional treatments which, if left untreated, can lead to significant complications, including infection, corneal perforation/scarring and vision loss. PCED has an estimated incidence of approximately 100,000 patients in the U.S. and represents a sizeable market opportunity; there are currently no U.S. Food and Drug Administration (FDA)-approved prescription products with a broad indication for all underlying etiologies of PCED. KALA is actively enrolling patients in the primary safety and efficacy portion of the CHASE (Corneal Healing After SEcretome therapy) Phase 2b clinical trial evaluating KPI-012 for the treatment of PCED and is targeting to announce topline data by year-end 2024.If the results are positive, and subject to discussion with regulatory authorities, KALA believes the CHASE Phase 2b trial could serve as the first of two pivotal trials required to support the submission of a Biologics License Application (BLA) to the FDA. KALA is also evaluating the potential of KPI-012 for additional rare, front-of-the-eye diseases, such as Limbal Stem Cell Deficiency (LSCD) and other corneal diseases that threaten vision. LSCD is characterized by the loss or deficiency of limbal epithelial stem cells, which can result in recurrent epithelial breakdown, neovascularization, conjunctivalization, inflammation and other sequalae that can lead to loss of corneal clarity and vision impairment. Like PCED, LSCD represents a substantial market opportunity, with an estimated incidence of 100,000 patients in the U.S. KPI-014, KALA’s preclinical program to evaluate the utility of its MSC-S platform for inherited retinal degenerative diseases, contains neurotrophic factors, growth factors, anti-inflammatory or immune-modulatory factors and antioxidant inhibitors with the potential to protect and preserve retinal cell function. Secretomes have demonstrated a neuroprotective effect in both in vitro and in vivo models of retinal degeneration. KALA believes KPI-014 could offer a gene-agnostic approach for the treatment of rare inherited retinal diseases and has initiated preclinical studies to evaluate the utility of KPI-014 for conditions such as Retinitis Pigmentosa and Stargardt Disease. Corporate:In December 2023 and March 2024, KALA announced private placement financings with an institutional investor, priced at-the-market under Nasdaq rules. Aggregate gross proceeds from the financings were approximately $2.0 million and $8.6 million, respectively. Financial Results: Cash Position: As of December 31, 2023, KALA had cash and cash equivalents of $50.9 million, compared to $56.1 million as of September 30, 2023. This decrease reflects cash used in operations and gross proceeds of $2.0 million received from KALA’s December 2023 private placement financing. Based on its current plans, KALA anticipates that its cash resources as of December 31, 2023, together with gross proceeds of $8.6 million received from its March 2024 private placement financing and anticipated funding under the CIRM award, will enable it to fund operations into the third quarter of 2025. Financial Results for the Three Months Ended December 31, 2023: SG&A Expenses: For the quarter ended December 31, 2023, selling, general and administrative (SG&A) expenses were $4.6 million, compared to $5.8 million for the same period in 2022. The decrease was primarily due to the sale of KALA’s commercial portfolio to Alcon Inc. (Alcon) in July 2022.R&D Expenses: For the quarter ended December 31, 2023, research and development (R&D) expenses were $4.7 million, compared to $3.3 million for the same period in 2022. The increase was primarily due to an increase in KPI-012 development costs and employee-related costs.Loss on Fair Value Remeasurement of Deferred Purchase Consideration: There was no gain or loss on fair value remeasurement of deferred purchase consideration, in connection with the acquisition of Combangio, for the quarter ended December 31, 2023 due to the settlement of the liability in March 2023. The loss on fair value remeasurement of deferred purchase consideration was $0.4 million for the same period in 2022.Loss on Fair Value Remeasurement of Contingent Consideration: For the quarter ended December 31, 2023, the loss on fair value remeasurement of continent consideration, in connection with the Combangio acquisition, was $0.3 million, compared to a loss of $0.7 million for the same period in 2022.Operating Loss: For the quarter ended December 31, 2023, loss from operations was $9.6 million, compared to $10.3 million for the same period in 2022.Net Loss: For the quarter ended December 31, 2023, net loss was $8.6 million, or $3.18 per share, compared to a net loss of $12.8 million, or $7.97 per share, for the same period in 2022. The weighted average number of shares used to calculate net loss per share was 2.7 million for the quarter ended December 31, 2023, and 1.6 million for the quarter ended December 31, 2022. Financial Results for the Full Year Ended December 31, 2023: Net Product Revenues: KALA did not recognize product revenues in the full year ended December 31, 2023 as a result of the sale of its commercial portfolio to Alcon in July 2022. For the full year ended December 31, 2022, Kala reported net product revenues of $3.9 million.Cost of Product Revenues: KALA did not record cost of product revenues in the full year ended December 31, 2023 as a result of the sale of its commercial portfolio to Alcon in July 2022. For the full year ended December 31, 2022, cost of product revenues was $2.6 million.SG&A Expenses: For the full year ended December 31, 2023, SG&A expenses were $20.6 million, compared to $65.0 million for the same period in 2022. The decrease was primarily due to the sale of KALA’s commercial portfolio to Alcon.R&D Expenses: For the full year ended December 31, 2023, R&D expenses were $18.6 million, compared to $17.7 million for the same period in 2022. The increase was primarily due to an increase in KPI-012 development costs and employee-related costs, partially offset by a decrease in other research and development costs, which primarily included preclinical studies related to KALA’s former pipeline programs and facility related costs.(Gain) Loss on Fair Value Remeasurement of Deferred Purchase Consideration: For the full year ended December 31, 2023, the gain on fair value remeasurement of deferred purchase consideration, in connection with the acquisition of Combangio, was $0.2 million, compared to a loss of $0.6 million for the same period in 2022.Loss (Gain) on Fair Value Remeasurement of Contingent Consideration: For the full year ended December 31, 2023, the loss on fair value remeasurement of continent consideration, in connection with the Combangio acquisition, was $0.7 million, compared to a gain of $0.3 million for the same period in 2022.Operating Loss: For the full year ended December 31, 2023, loss from operations was $39.7 million, compared to $81.7 million for the same period in 2022.Loss on Extinguishment of Debt: For the full year ended December 31, 2023, KALA did not report a loss on extinguishment of debt, compared to a loss of $2.6 million in the same period in 2022 as a result of a partial prepayment of outstanding principal and related fees under its loan agreement with Oxford Finance LLC in connection with the closing of the sale of its commercial business to Alcon.Gain on Sale of Commercial Business: For the full year ended December 31, 2023, KALA did not report a gain on sale of commercial business, compared to a gain of $47.0 million for the same period in 2022 related to the sale of its commercial business to Alcon.Net Loss: For the full year ended December 31, 2023, net loss was $42.2 million, or $17.35 per share, compared to a net loss of $44.8 million, or $29.48 per share, for the same period in 2022. The weighted average number of shares used to calculate net loss per share was 2.4 million for the full year ended December 31, 2023, and 1.5 million for the full year ended December 31, 2022. About KALA BIO, Inc. KALA is a clinical-stage biopharmaceutical company dedicated to the research, development and commercialization of innovative therapies for rare and severe diseases of the eye. KALA’s biologics-based investigational therapies utilize KALA’s proprietary mesenchymal stem cell secretome (MSC-S) platform. KALA’s lead product candidate, KPI-012, is a human MSC-S, which contains numerous human-derived biofactors, such as growth factors, protease inhibitors, matrix proteins and neurotrophic factors that can potentially correct the impaired corneal healing that is an underlying etiology of multiple severe ocular diseases. KPI-012 is currently in clinical development for the treatment of persistent corneal epithelial defect (PCED), a rare disease of impaired corneal healing, for which it has received Orphan Drug and Fast Track designations from the U.S. Food and Drug Administration. KALA is also targeting the potential development of KPI-012 for the treatment of Limbal Stem Cell Deficiency and other rare corneal diseases that threaten vision and has initiated preclinical studies to evaluate the potential utility of its MSC-S platform for retinal degenerative diseases, such as Retinitis Pigmentosa and Stargardt Disease. For more information on KALA, please visit www.kalarx.com. Forward-Looking Statements: This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve substantial risks and uncertainties. Any statements in this press release about KALA’s future expectations, plans and prospects, including but not limited to statements about KALA’s expectations with respect to potential advantages of KPI-012 and its MSC-S platform; the clinical utility of KPI-012 for PCED; anticipated timelines to report topline data for the CHASE Phase 2b clinical trial of KPI-012; KALA’s belief that the Chase Phase 2b trial could serve as the first of two pivotal trials required to support the submission of a BLA to the FDA; KALA’s plans to pursue research and development of KPI-012 and its MSC-S platform for other indications; expectations about the potential benefits and future operation of the CIRM award; KALA’s ability to achieve the specified milestones and obtain the full funding under the CIRM award; the sufficiency of KALA’s existing cash resources for the period anticipated; and other statements containing the words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “likely,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would,” and similar expressions constitute forward-looking statements. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: KALA’s ability to comply with the requirements under the CIRM award; uncertainties inherent in the initiation and conduct of preclinical studies and clinical trials; uncertainties regarding availability and timing of data from clinical trials; whether results of early clinical trials or trials in different disease indications will be indicative of the results of ongoing or future trials; whether results of the Phase 1b clinical trial of KPI-012 will be indicative of results for any future clinical trials and studies of KPI-012, including the CHASE Phase 2b clinical trial; whether interim data from a clinical trial will be predictive of the results of the trial; uncertainties associated with regulatory review of clinical trials and applications for marketing approvals; KALA’s ability to retain and hire key personnel; KALA’s ability to comply with the covenants under its loan agreement, including the requirement that its common stock continue to be listed on The Nasdaq Stock Market; the sufficiency of cash resources and need for additional financing and other important factors, any of which could cause KALA’s actual results to differ from those contained in the forward-looking statements, discussed in the “Risk Factors” section of KALA’s Annual Report on Form 10-K, most recent Quarterly Report on Form 10-Q and other filings KALA makes with the Securities and Exchange Commission. These forward-looking statements represent KALA’s views as of the date of this press release and should not be relied upon as representing KALA’s views as of any date subsequent to the date hereof. KALA does not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Financial Tables: KALA BIO, Inc.Balance Sheet Data(in thousands)(unaudited) December 31, December 31, 2023 2022Cash and cash equivalents $50,895 $70,495Total assets 55,949 86,820Working capital(1) 44,524 60,257Long-term debt, net of discounts 34,190 37,937Other long-term liabilities 5,909 4,224Total stockholders’ equity 7,504 18,974 (1) The Company defines working capital as current assets less current liabilities. See the Company's consolidated financial statements for further information regarding its current assets and current liabilities. KALA BIO, Inc.Consolidated Statement of Operations(In thousands, except share and per share data)(Unaudited) Three Months Ended Year Ended December 31, December 31, 2023 2022 2023 2022 Product revenues, net $— $— $— $3,892 Costs and expenses: Cost of product revenues — — — 2,560Selling, general and administrative 4,623 5,831 20,567 65,035Research and development 4,718 3,323 18,586 17,653Loss (gain) on fair value remeasurement of deferred purchase consideration — 433 (230) 638Loss (gain) on fair value remeasurement of contingent consideration 278 664 740 (288)Total operating expenses 9,619 10,251 39,663 85,598Loss from operations (9,619) (10,251) (39,663) (81,706)Other income (expense): Interest income 610 354 2,711 664Interest expense (1,468) (1,577) (5,814) (7,266)Grant income 1,855 — 4,825 —Loss on extinguishment of debt — — — (2,583)Gain on sale of commercial business — — — 46,995Other income (expense), net (5) (1,369) (4,258) (926)Total other income (expense) 992 (2,592) (2,536) 36,884Net loss $(8,627) $(12,843) $(42,199) $(44,822)Net loss per share attributable to common stockholders—basic and diluted $(3.18) $(7.97) $(17.35) $(29.48)Weighted average shares outstanding—basic and diluted 2,712,475 1,611,375 2,432,008 1,520,611 Investor Contact:Hannah Deresiewiczhannah.deresiewicz@sternir.com212-362-1200

• Initial clinical data suggest the potential of B-VEC to treat lesions in the eye of DEB patients and additional applications of Krystal’s HSV-1 platform to treat ocular diseases • Repeat administration of B-VEC eyedrops was well tolerated and associated with full corneal healing by 3 months as well as significant visual acuity improvement from hand motion to 20/25 at 8 months • Second NEJM publication of B-VEC clinical data adding to evidence of benefit for DEB patients in both skin and ocular tissue PITTSBURGH, Feb. 08, 2024 (GLOBE NEWSWIRE) -- Krystal Biotech, Inc. (the “Company”) (NASDAQ: KRYS), a commercial-stage biotechnology company, today announced data on the compassionate use of beremagene geperpavec (B-VEC), administered as an eyedrop to treat a patient with dystrophic epidermolysis bullosa (DEB) with cicatrizing conjunctivitis has been published in the New England Journal of Medicine (NEJM). The full manuscript, titled “Ocular Gene Therapy in a Patient with Dystrophic Epidermolysis Bullosa,” can be found in the February 8, 2024 issue of the NEJM. Over 25% of patients with DEB develop ocular complications such as corneal erosions, abrasions, blistering and scarring that can lead to impaired vision. Disease management varies from supportive care and wound management to surgical interventions to remove scar tissue. No corrective therapy is presently available. The NEJM publication describes the first application of B-VEC to treat ocular complications in a patient with DEB under a compassionate use program. “DEB is a devastating disease and patients with ocular complications have no corrective treatment options leaving them at risk of severe vision loss,” said Alfonso L. Sabater, M.D., PhD, Associate Professor of Clinical Ophthalmology at the Bascom Palmer Eye Institute at the University of Miami Miller School of Medicine, and investigator. “We are encouraged by the improvements observed in the patient following B-VEC administration as an eyedrop directly to the affected eye and believe this data is supportive of further investigation in DEB patients with ocular complications. If approved, this approach could drastically benefit these patients.” A patient presented with severe cicatrizing conjunctivitis secondary to DEB. Surgical symblepharon lysis of the patient’s right eye with pannus removal was conducted and regular administration of B-VEC as an eyedrop directly to the eye (5×109 PFU/mL) were added to routine post-surgical care, three times weekly for the first two weeks and then once weekly. B-VEC application frequency was further decreased to once monthly once the corneal epithelium was healed. B-VEC was well tolerated and associated with full corneal healing by 3 months as well as significant visual acuity improvement from hand motion to 20/25 at 8 months. “We are excited by this initial data suggesting additional applications of our proprietary HSV-1-based gene therapy platform to treat ocular diseases, and we are working with the FDA to get B-VEC approved for the treatment of DEB patients with lesions in the eye,” said Suma Krishnan, President, Research & Development, Krystal Biotech. About Dystrophic Epidermolysis Bullosa (DEB) DEB is a rare and severe disease that affects the skin and mucosal tissues. It is caused by one or more mutations in a gene called COL7A1, which is responsible for the production of the protein type VII collagen (COL7) that forms anchoring fibrils that bind the dermis (inner layer of the skin) to the epidermis (outer layer of the skin). The lack of functional anchoring fibrils in DEB patients leads to extremely fragile skin that blisters and tears from minor friction or trauma. DEB patients suffer from open wounds, which leads to skin infections, fibrosis which can cause fusion of fingers and toes, and ultimately an increased risk of developing an aggressive form of squamous cell carcinoma which, in severe cases, can be fatal. Ocular complications are common in patients with DEB, with over half of the patients diagnosed with recessive DEB potentially affected. Typical ocular manifestations include corneal abrasion, as well as corneal scarring, pannus, eyelid ectropions and blisters.1,2 There are no FDA-approved treatment options for ocular manifestations of DEB.3 About B-VEC and VYJUVEK B-VEC is a non-invasive, redosable gene therapy built to deliver two copies of the COL7A1 gene to treat DEB at the molecular level by providing the patient’s cells the template to make normal COL7 protein, thereby addressing the fundamental disease-causing mechanism. VYJUVEK® is a topical formulation consisting of B-VEC mixed with a sterile gel that is applied directly to DEB wounds of the skin. In May 2023, the U.S. Food and Drug Administration (FDA) approved VYJUVEK for the treatment of DEB wounds. The FDA has not approved B-VEC for the treatment of DEB patients with ocular complications. For more information on VYJUVEK, see full U.S. Prescribing Information. About Krystal Biotech’s HSV-1 Based Platform Krystal Biotech’s patented HSV-1 based platform is based on engineered viral vectors that efficiently deliver therapeutic transgenes to cells of interest in multiple organ systems. The cell’s own machinery then transcribes and translates the encoded effector to treat or prevent disease. Key differentiating features of the Company’s HSV-1 based platform include a large genetic cargo capacity, a non-integrating DNA payload, broad cellular tropism, immune evasiveness which enables repeat dosing, and scalable manufacturing. About Krystal Biotech, Inc. Krystal Biotech, Inc. (NASDAQ: KRYS) is a commercial-stage biotechnology company focused on the discovery, development and commercialization of genetic medicines to treat diseases with high unmet medical needs. VYJUVEK is the Company’s first commercial product, the first-ever redosable gene therapy, and the first medicine approved by the FDA for the treatment of dystrophic epidermolysis bullosa. The Company is rapidly advancing a robust preclinical and clinical pipeline of investigational genetic medicines in respiratory, oncology, dermatology, ophthalmology, and aesthetics. Krystal Biotech is headquartered in Pittsburgh, Pennsylvania. For more information, please visit , and follow @KrystalBiotech on LinkedIn and X (formerly Twitter). Forward-Looking Statements Any statements in this press release about future expectations, plans and prospects for Krystal Biotech, Inc., including statements about further investigation of B-VEC in DEB patients with ocular complications, the potential for additional applications of the Company’s proprietary HSV-1-based gene therapy platform to treat ocular diseases, and other statements containing the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “target,” “potential,” “likely,” “will,” “would,” “could,” “should,” “continue,” and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: uncertainties associated with regulatory review of clinical trials and applications for marketing approvals, the availability or commercial potential of product candidates, the sufficiency of cash resources and need for additional financing and such other important factors as are set forth under the caption “Risk Factors” in the Company’s annual and quarterly reports on the U.S. Securities and Exchange Commission. In addition, the forward-looking statements included in this press release represent the Company’s views as of the date of this release. The Company anticipates that subsequent events and developments will cause its views to change. However, while the Company may elect to update these forward-looking statements at some point in the future, it specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to the date of this release. CONTACT: Investors and Media Meg Dodge Krystal Biotech mdodge@krystalbio.com 1. Tang JY, Marinkovich MP, Lucas E, et al. A systematic literature review of the disease burden in patients with recessive dystrophic epidermolysis bullosa. Orphanet J Rare Dis. 2021 Apr 13; 16(1): 175. doi: 10.1186/s13023-021-01811-7. 2. Tong L, Hodgkins PR, Denyer J, et al. The eye in epidermolysis bullosa. Br J Ophthalmol. 1999 Mar; 83(3): 323-6. doi:10.1136/bjo.83.3.323. 3. Chen VM, Mehta N, Robbins CC, et al. Anterior-segment spectral domain optical coherence tomography in epidermolysis bullosa. Ocul Surf. 2020 Oct; 18(4): 912-919. doi: 10.1016/j.jtos.2020.08.010