10-K

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

For the fiscal year ended June 30, 2021

For the transition period from

Commission File Number:

001-39267

Benitec Biopharma Inc.

(Exact name of registrant as specified in its charter)

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code

(510)780-0819

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registered

Common Stock, par value $0.0001 BNTC The Nasdaq Stock Market LLC

Securities registered pursuant to Section 12(g) of the Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data file required to be submitted pursuant to Rule 405 of Regulation

S-T

(§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a

non-accelerated

filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in

Rule 12b-2

of the Exchange Act.

Large Accelerated Filer ☐ Accelerated Filer ☐

Non-Accelerated Filer ☒ Smaller Reporting Company ☒

Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

☐

Indicate by check mark whether the registrant is a shell company (as defined in

Rule 12b-2

of the Act). Yes ☐ No ☒

The aggregate market value of the Registrant’s common equity held by

non-affiliates,

based upon the closing price of the Registrant’s securities on the Nasdaq Capital Market of $3.00 on December 31, 2020 was approximately $13,621,407.

There were 8,171,690 shares of the Registrant’s common stock, $0.0001 par value per share, outstanding on September 7, 2021.

DOCUMENTS INCORPORATED BY REFERENCE

None

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BENITEC BIOPHARMA INC.

ANNUAL REPORT ON FORM

10-K

TABLE OF CONTENTS

Page

PART I

Item 1. Business 3

Item 1A. Risk Factors 39

Item 1B. Unresolved Staff Comments 82

Item 2. Properties 83

Item 3. Legal Proceedings 83

Item 4. Mine Safety Disclosures 83

PART II

Item 6. Selected Financial Data 84

Item 7A. Quantitative and Qualitative Disclosures about Market Risk 94

Item 8. Financial Statements and Supplementary Data F-1

Item 9A. Controls and Procedures F-27

Item 9B. Other Information F-27

PART III

Item 10. Directors, Executive Officers and Corporate Governance III-1

Item 11. Executive Compensation III-5

Item 14. Principal Accountant Fees and Services III-13

PART IV

Item 15. Exhibits and Financial Statement Schedules IV-1

Item 16. Form 10-K Summary IV-2

Signatures IV-3

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PART I

ABOUT THIS ANNUAL REPORT

Unless the context otherwise requires, the terms “Benitec,” the “Company,” “we,” “us,” “our” and similar terms used in this Annual Report on Form

10-K

refer (i), prior to the

Re-domiciliation

(as defined herein) to Benitec Biopharma Limited (BBL), an Australian corporation, and its subsidiaries, and (ii), following the

Re-domiciliation,

to Benitec Biopharma Inc., a Delaware corporation, and its subsidiaries (including Benitec Limited). Any references to “Benitec Limited” or “BBL” refer to Benitec Biopharma Limited, an Australian corporation.

All references to “$” in this Annual Report refer to U.S. dollars. All references to “A$” in this Annual Report mean Australian dollars. As of June 30, 2021, the rate of exchange of U.S. dollars to Australian dollars was 1.3323 AUD.

Our fiscal

year-end

is June 30. References to a particular “fiscal year” are to our fiscal year ended June 30 of that calendar year.

INDUSTRY AND MARKET DATA

This Annual Report includes information with respect to market and industry conditions and market share from third-party sources or based upon estimates using such sources when available. We believe that such information and estimates are reasonable and reliable. We also believe the information extracted from publications of third-party sources has been accurately reproduced. However, we have not independently verified any of the data from third-party sources. Similarly, our internal research is based upon our understanding of industry conditions, and such information has not been verified by any independent sources.

TRADEMARKS AND TRADENAMES

We have proprietary and licensed rights to trademarks used in this Annual Report which are important to our business, many of which are registered under applicable intellectual property laws. Our trademarks include:

• BENITEC BIOPHARMA®

• BENITEC®

• GIVING DISEASE THE SILENT TREATMENT®

• SILENCING GENES FOR LIFE®

Solely for convenience, trademarks and trade names referred to in this Annual Report appear without the “

” or “

” symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent possible under applicable law, our rights or the rights of the applicable licensor to these trademarks and trade names. We do not intend our use or display of other companies’ trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other companies. Each trademark, trade name or service mark of any other company appearing in this Annual Report is the property of its respective holder.

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. All statements, other than statements of historical fact included in this Annual Report, regarding our strategy, future operations, financial position, projected costs, prospects, plans and objectives of management are forward-looking statements. When used in this Annual Report, the words “could,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “may,” “continue,” “predict,” “potential,” “project,” or the negative of these terms, and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, levels of activity, performance or achievements to be materially different from the information expressed or implied by these forward-looking statements. These risks, uncertainties and factors include:

• the timing of the availability of data from clinical trials;

• the timing and outcome of regulatory filings and approvals;

• unanticipated delays;

• sales, marketing, manufacturing and distribution requirements;

• market competition and the acceptance of our products in the marketplace;

• regulatory developments in the United States;

• the development of novel AAV vectors;

• the plans of licensees of our technology;

• our intellectual property position and the duration of our patent portfolio;

as well as other risks detailed under the caption “Risk Factors” in this Annual Report and in other reports filed with the SEC. Although we believe that we have a reasonable basis for each forward-looking statement contained in this Annual Report, we caution you that these statements are based on a combination of facts and important factors currently known by us and our expectations of the future, about which we cannot be certain.

We have based the forward-looking statements included in this Annual Report on information available to us on the date of this Annual Report or on the date thereof. Except as required by law we undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or

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otherwise. You are advised to consult any additional disclosures that we may make directly to you or through reports that we, in the future, may file with the SEC, including annual reports on

Form 10-K,

quarterly reports on

Form 10-Q

and current reports on

Form 8-K.

All forward-looking statements included herein or in documents incorporated herein by reference are expressly qualified in their entirety by the cautionary statements contained or referred to elsewhere in this Annual Report.

Item 1. Business.

Company Overview

We endeavor to become the leader in discovery, development, and commercialization of therapeutic agents capable of addressing significant unmet medical need via the application of the silence and replace approach to the treatment of genetic disorders.

Benitec Biopharma Inc. (“Benitec” or the “Company” or in the third person, “we” or “our”) is a development-stage biotechnology company focused on the advancement of novel genetic medicines with headquarters in Hayward, California. The proprietary platform, called

DNA-directed

RNA interference, or ddRNAi, combines RNA interference, or RNAi, with gene therapy to create medicines that facilitate sustained silencing of disease-causing genes following a single administration. The Company is developing ddRNAi-based therapeutics for chronic and life-threatening clinical indications including Oculopharyngeal Muscular Dystrophy (OPMD), and Chronic Hepatitis B.

BB-301

is the most advanced ddRNAi-based genetic medicine currently under development by Benitec.

BB-301

is an

AAV-based

gene therapy designed to both silence the expression of mutated, disease-causing genes (to slow, or halt, the underlying mechanism of disease progression) and simultaneously replace the mutant genes with normal, “wild type” genes (to drive restoration of function in diseased cells). This fundamental therapeutic approach to disease management is called “silence and replace” and this biological mechanism offers the potential to restore the underlying physiology of the treated tissues and, in the process, improve treatment outcomes for patients suffering from the chronic and, potentially, fatal effects of Oculopharyngeal Muscular Dystrophy (OPMD).

BB-301

has been granted Orphan Drug Designation in the United States and the European Union.

Through the combination of the targeted gene silencing effects of RNAi and the durable transgene expression achievable via the use of modified viral vectors, the silence and replace approach has the potential to produce long-term silencing of disease-causing genes along with simultaneous replacement of wild type gene function following a single administration of the proprietary genetic medicine. We believe this novel attribute of the investigational agents under development by Benitec may facilitate the achievement of robust clinical activity while greatly reducing the dosing frequencies traditionally expected for medicines employed for the management of chronic diseases. Additionally, the achievement of long-term gene silencing and gene replacement may significantly reduce the risk of patient

non-compliance

during the course of medical management of potentially fatal clinical disorders.

We will require additional financing to continue the development of our product candidates through key inflection points.

Our proprietary technology platforms are designated as

DNA-directed

RNA interference, or “ddRNAi”, and “silence and replace”. ddRNAi is designed to produce long-term silencing of disease-causing genes, by combining RNA interference, or RNAi, with viral delivery agents typically associated with the field of gene therapy (i.e., viral vectors). Modified AAV vectors are employed to deliver genetic constructs which encode short hairpin RNAs that are, then, serially expressed and processed to produce siRNA molecules within the transduced cell for the duration of the life of the target cell. These newly introduced siRNA molecules drive

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long-term, and potentially permanent, silencing of the expression of the disease-causing gene. The silence and replace approach further bolsters the biological benefits of long-term silencing of disease-causing genes by incorporating multifunctional genetic constructs within the modified AAV vectors to create an

AAV-based

gene therapy agent that is designed to both silence the expression of mutated, disease-causing genes (to slow, or halt, the underlying mechanism of disease progression) and, simultaneously, replace the mutant genes with normal, “wild type” genes (to drive restoration of function in diseased cells). This fundamentally distinct therapeutic approach to disease management offers the potential to restore the underlying physiology of the treated tissues and, in the process, improve treatment outcomes for patients suffering from the chronic and, potentially, fatal effects of diseases like Oculopharyngeal Muscular Dystrophy (OPMD).

Traditional gene therapy is defined by the introduction of an engineered transgene to correct the pathophysiological derangements derived from mutated or malfunctioning genes. Mutated genes can facilitate the intracellular production of disease-causing proteins or hamper the production of critical, life-sustaining, proteins. The introduction of a new transgene can facilitate the restoration of production of normal proteins within the diseased cell, thus, restoring natural biological function. Critically, the implementation of this traditional method of gene therapy cannot eliminate the expression, or the potential deleterious effects of, the underlying mutant gene (as mutant proteins may be continually expressed and aggregate or drive the aggregation of other native proteins within the diseased cell). In this regard, the dual capabilities of the proprietary silence and replace approach to silence a disease-causing gene via ddRNAi and simultaneously replace the wildtype activity of a mutant gene via the delivery of an engineered transgene could facilitate the development of differentially efficacious treatments for a range of genetic disorders.

Overview of RNAi and the siRNA Approach

The mutation of a single gene can cause a chronic disease via the resulting intracellular production of a disease-causing protein (i.e. an abnormal form of the protein of interest), and many chronic and/or fatal disorders are known to result from the inappropriate expression of a single gene or multiple genes. In some cases, genetic disorders of this type can be treated exclusively by “silencing” the intracellular production of the disease-causing protein through well-validated biological approaches like RNA interference (“RNAi”). RNAi employs small nucleic acid molecules to activate an intracellular enzyme complex, and this biological pathway temporarily reduces the production of the disease-causing protein. In the absence of the disease-causing protein, normal cellular function is restored and the chronic disease that initially resulted from the presence of the mutant protein is partially or completely resolved. RNAi is potentially applicable to over 20,000 human genes and a large number of disease-causing microorganism-specific genes.

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Figure 1

A small double stranded RNA, or dsRNA, molecule (A, Figure 1), comprising one strand known as the sense strand and another strand known as the antisense strand, which are complementary to each other, is synthesized in the laboratory. These small dsRNAs are called small interfering RNAs, or siRNAs. The sequence of the sense strand corresponds to a short region of the target gene mRNA. The siRNA is delivered to the target cell (B, Figure 1), where a group of enzymes, referred to as the

RNA-Induced

Silencing Complex, or RISC, process the siRNA (C, Figure 1), where one of the strands (usually the sense strand) is released (D, Figure 1). RISC uses the antisense strand to find the mRNA that has a complementary sequence (E, Figure 1) leading to the cleavage of the target mRNA (F, Figure 1). As a consequence, the output of the mRNA (protein production) does not occur (G, Figure 1). Several companies, including Alnylam Pharmaceuticals Inc. (“Alnylam”), Arbutus Biopharma Corp. (“Arbutus”), and Dicerna Pharmaceuticals Inc. (“Dicerna”), utilize this approach in their RNAi product candidates.

Importantly, many genetic disorders are not amenable to the traditional gene silencing approach outlined in Figure 1, as the diseased cells may produce a mixture of the wildtype protein of interest and the disease-causing mutant variant of the protein, and the underlying genetic mutation may be too small to allow for selective targeting of the disease-causing variant of the protein through the use of siRNA-based approaches exclusively. In these cases, it is extraordinarily difficult to selectively silence the disease-causing protein without simultaneously silencing the wildtype intracellular protein of interest whose presence is vital to the conduct of normal cellular functions.

Our proprietary silence and replace technology utilizes the unique specificity and robust gene silencing capabilities of RNAi while overcoming many of the key limitations of siRNA-based approaches to disease management.

In the standard RNAi approach, double-stranded siRNA is produced synthetically and, subsequently, introduced into the target cell via chemical modification of the RNA or alternative methods of delivery. While efficacy has

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been demonstrated in several clinical indications through the use of this approach, siRNA-based approaches maintain a number of limitations, including:

• Potential adverse immune responses, resulting in serious adverse effects;

Our Approach to the Treatment of Genetic Diseases—ddRNAi and Silence and Replace

Our proprietary silence and replace approach to the treatment of genetic diseases combines RNAi with wildtype gene replacement to drive sustained silencing of disease-causing genes and concomitant restoration of functional wildtype genes following a single administration of the therapeutic agent. Benitec employs ddRNAi in combination with classical gene therapy (i.e. transgene delivery via viral vectors) to overcome several of the fundamental limitations of RNAi.

The silence and replace approach to the treatment of genetic disorders employs adeno-associated viral vectors (“AAVs”) to deliver genetic constructs which may, after a single administration to the target tissues:

Our silence and replace technology utilizes proprietary DNA expression cassettes to foster continuous production of gene silencing shRNAs and wildtype proteins (via expression of the wildtype transgene). A range of viral and

non-viral

gene therapy vectors can be used to deliver the DNA construct into the nucleus of the target cell and, upon delivery, shRNA molecules are expressed and subsequently processed by intracellular enzymes into siRNA molecules that silence the expression of the mutant, disease-causing protein (Figure 2).

In the silence and replace approach (Figure 2):

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Figure 2

Our strategy is to discover, develop and commercialize treatments that leverage the capabilities of ddRNAi and the silence and replace approach to disease management.

For selected product candidates, at the appropriate stage, we may collaborate with large biopharmaceutical companies to further

co-develop

and, if approved, commercialize our ddRNAi-based and silence and replace-based products to achieve broad clinical and commercial distribution. For specific clinical indications that we deem to be outside of our immediate areas of focus (e.g. HBV), we will continue to

out-license,

where appropriate, applications of our ddRNAi and silence and replace technology to facilitate the development of differentiated therapeutics, which could provide further validation of our proprietary technology and approach to disease management.

Our cash and cash equivalents will be deployed to advance our product candidate

BB-301

for OPMD and, while we are not actively working on the development of

BB-103

for the treatment of HBV, we may seek a strategic partnership to support its development.

Oculopharyngeal Muscular Dystrophy—OPMD

OPMD is an insidious, autosomal-dominant, late-onset degenerative muscle disorder that typically presents in patients at

40-to-50

years of age. The disease is characterized by progressive swallowing difficulties (dysphagia)

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and eyelid drooping (ptosis). OPMD is caused by a specific mutation in the poly(A)-binding protein nuclear 1, or PABPN1, gene. OPMD is a rare disease; however, patients have been diagnosed with OPMD in at least 33 countries. Patient populations suffering from OPMD are well-identified, and significant geographical clustering has been noted for patients with this disorder, which could simplify clinical development and global commercialization efforts.

BB-301

is an

AAV-based

BB-301

has been granted Orphan Drug Designation in the United States and the European Union.

On July 9, 2018, the Company entered into a License and Collaboration Agreement with Axovant. Pursuant to the Agreement, the Company granted Axovant an exclusive worldwide license to develop, manufacture, and commercialize products containing the Company’s product known as BB-301, which was designed for the potential treatment of Oculopharyngeal Muscular Dystrophy. As of September 3, 2019, the License and Collaboration Agreement with Axovant was terminated. As a result, all rights and licenses which Benitec had granted to Axovant to develop and commercialize

BB-301

and related gene therapy product candidates terminated. We are now solely responsible for the costs in connection with the development and commercialization of the

BB-301

product candidates.

Prior to such termination, the Benitec team endeavored to conduct several additional exploratory nonclinical analyses in order to potentially improve the biological efficacy of

BB-301

via further optimization of the route of administration employed to dose the target muscle tissues.

Hepatitis B

Nonclinical experiments have been completed in support of the prior development of

BB-103

for the treatment of HBV. Results of in vivo and in vitro studies, from December 2016, March 2016 and December 2015, demonstrated the potential utility of an approach that combines RNAi with gene therapy to treat HBV. In April 2017, the Company completed a

pre-IND

submission with the FDA in which the feedback provided by the agency included details regarding steps required to initiate a clinical trial for

BB-103.

As noted, the Company may seek strategic partnerships to complete the IND enabling studies for

BB-103.

Our Strengths

We believe that the combination of our proprietary ddRNAi technology and our deep expertise in the design and development of genetic medicines, and specifically ddRNAi-based therapeutics, will enable us to achieve and maintain a leading position in gene silencing and gene therapy for the treatment of human disease. Our key strengths include:

• A first mover advantage for ddRNAi-based therapeutics;

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Our Strategy

• Selectively develop proprietary and partnered programs; and

Our senior leadership team will continue to explore partnership opportunities with global biopharmaceutical companies, as we expect that the unique attributes of the proprietary ddRNAi and silence and replace approaches, and the breadth of potential clinical indications amenable to our proprietary methods, to support the formation of collaborations over a broad range of diseases with significant unmet medical need.

We seek to actively protect our intellectual property and proprietary technology. These efforts are central to the growth of our business and include:

• Protecting and enforcing our intellectual property rights; and

Our Pipeline

The following table sets forth our current product candidates and their development status:

Table 1. Pipeline: Oculopharyngeal Muscular Dystrophy and Chronic Hepatitis B Virus Infection

BB-301

is under development for the treatment of Oculopharyngeal Muscular Dystrophy and is currently undergoing evaluation in

IND-enabling

studies.

BB-301

is the lead pipeline program for Benitec, and the key attributes of

BB-301

are outlined in in Figure 3.

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Figure 3

BB-103

has demonstrated robust nonclinical activity during the evaluation of this agent for the treatment of Chronic Hepatitis B Virus infection. Benitec is currently seeking strategic partners to advance

BB-103

through

IND-enabling

studies.

In-House

Development Programs

BB-301

for the Treatment of Oculopharyngeal Muscular Dystrophy

OPMD is an insidious, autosomal-dominant, late-onset, degenerative muscle disorder that typically presents in patients at

40-to-50

years of age. The disease is characterized by progressive swallowing difficulties (dysphagia) and eyelid drooping (ptosis). OPMD is caused by a specific mutation in the poly(A)-binding protein nuclear 1, or PABPN1, gene. OPMD is a rare disease, however, patients have been diagnosed with OPMD in at least 33 countries. Patient populations suffering from OPMD are well-identified, and significant geographical clustering has been noted for patients with this disorder, which could simplify clinical development and global commercialization efforts.

PABPN1 is a ubiquitous factor that promotes interaction between the poly(A) polymerase and CPSF (cleavage and polyadenylation specificity factor) and, thus, controls the length of mRNA poly(A) tails, mRNA export from the nucleus, and alternative poly(A) site usage. The characteristic genetic mutation underlying OPMD results in trinucleotide repeat expansion(s) within exon 1 of PABPN1 and results in an expanded poly-alanine tract at the

N-terminal

end of PABPN1. The mutation generates a protein with an

N-terminal

expanded poly-alanine tract of up to 18 contiguous alanine residues prone to the formation of aggregates called intranuclear inclusions (INIs). The INIs that sequester wildtype PABPN1 could also contribute to loss of the function phenotype associated with OPMD.

Current OPMD Treatments and Investigational Therapeutic Agents in Development

No curative or disease-modifying therapies currently exist for OPMD patients. Surgical interventions can be undertaken for palliative purposes, including the use of cricopharyngeal myotomy.

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Investigational therapies that have been explored, unsuccessfully, in the past include:

• Intravenous administration of trehalose; and

• The use of autologous myoblast transplant.

BB-301

is our Lead, Silence and Replace-Based, OPMD Therapeutic Agent

BB-301

is composed of a modified AAV serotype 9 (AAV9) capsid that expresses a bifunctional construct under the control of a single muscle specific

Spc5-12

promoter to achieve

co-expression

of both the codon-optimized PABPN1 mRNA and two shmiR molecules directed against wild type and mutant PABPN1.

BB-301

designed to correct the genetic defect underlying OPMD following a single localized administration.

BB-301—Design

and Mechanism of Action

BB-301

is designed to target two distinct regions of the PABPN1 mRNA to accomplish gene silencing via the concomitant expression of two distinct shmiRs from a single DNA construct (

Figure 4

BB-301

is also engineered to drive the simultaneous expression of a codon-optimized, siRNA-resistant, version of the wildtype PABPN1 gene

(Figure 4)

Figure 4

In collaboration with researchers at the Royal Holloway University of London and the Institut de Myologie in Paris, we developed a ddRNAi construct expressing three shRNAs against three distinct regions of PABPN1 mRNA and observed effective silencing of the PABPN1 gene

in vitro

using this ddRNAi construct. Furthermore, as part of this collaboration, we have generated a gene expression construct that produces a siRNA-resistant version of the wildtype PABPN1 gene.

In subsequent studies undertaken exclusively by Benitec, a second set of target regions within PABPN1 were identified for therapeutic development and shmiRs designed against these regions. Additional shmiRs have also been designed for the original shRNA developed in collaboration with Royal Holloway University of London and the Institut de Myologie. The ‘silence and replace’ construct, designated

BB-301,

incorporates the two best performing shmiRs, and the gene expression construct that produces a siRNA-resistant version of the wildtype PABPN1 gene, under the control of a muscle-specific promoter. The mechanism of action of

BB-301

is shown in Figure 5.

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Figure 5

In initial

in vivo

studies evaluating the use of direct intramuscular injection of

AAV-based

constructs with the potential to facilitate the desired silence and replace approach in the A17 transgenic mouse model of OPMD at the Royal Holloway University of London and the Institut de Myologie, we observed decreases in muscle fibrosis, increases in cross sectional area of the treated muscles, decreases in intranuclear inclusions, and normalization of muscle strength. These nonclinical results were published in

Nature Communications

in April 2017.

In subsequent studies, Benitec demonstrated in a key

non-clinical

model (the A17 mouse model) that a single intramuscular injection of

BB-301

results in robust intracellular silencing of PABPN1 protein production and concomitant expression of the normal, biologically functional PABPN1 protein. In the A17 mouse model, the treatment restores muscle strength and muscle weight to wild type levels and improves other physiological hallmarks of the disease (Figure 6a, Figure 6b, Figure 6c, Figure 6d):

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Figure 6a. Dose-Dependent shRNA Expression

Figure 6b. Dose-Dependent PABPN1 Inhibition and Transgene Expression

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Figure 6c. Dose-Dependent Decreases in Intranuclear Inclusions

Figure 6d. Dose-Dependent Increases in Muscle Force

Ongoing Development Plans for

BB-301

On July 8, 2020, Benitec announced the initiation of the

BB-301

Pilot Dosing Study in large animal subjects.

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The

BB-301

Pilot Dosing Study is the first of two planned

IND-enabling

studies that were designed to be conducted in large animals. These

IND-enabling

studies continue to be carried out under the guidance of the scientific team at Benitec, with key elements of the study design and execution conducted in close collaboration with a team of leading experts in both medicine and surgery that have been deeply engaged in the treatment of OPMD patients for several decades. The

BB-301

Pilot Dosing Study, along with the subsequent GLP Toxicology and Biodistribution Study, will be conducted in canine subjects and will support the validation and optimization of the newly designed method of

BB-301

administration, confirm the efficiency of vector transduction and transgene expression in the key tissue compartments underlying the natural history of OPMD, confirm the optimal drug doses in advance of initiation of human clinical studies, and facilitate observation of key toxicological data-points.

The

BB-301

Pilot Dosing Study was designed as an

8-week

study in Beagle dogs to confirm the transduction efficiency of

BB-301

upon administration via direct intramuscular injection into specific anatomical regions of the pharynx through the use of an open surgical procedure. This new route of

BB-301

administration was developed in collaboration with key surgical experts in the field of Otolaryngology, and this novel method of

BB-301

dosing will significantly enhance the ability of a treating physician to accurately administer the

AAV-based

investigational agent to the muscles that underlie the characteristic deficits associated with the progression of OPMD. It is important to note that prior

non-clinical

studies of

BB-301

have reproducibly validated the robust biological activity achieved following direct intramuscular injection. As an example, direct injection of

BB-301

into the tibialis anterior muscles of A17 mice facilitated robust transduction of the targeted skeletal muscle cells and supported complete remission of the OPMD disease phenotype in this animal model.

Interim data for the

BB-301

Pilot Dosing Study was reported in early 2021:

Benitec conducted the

BB-301

Pilot Dosing Study in Beagle dog subjects to demonstrate that direct intramuscular injection of

BB-301

via the use of a proprietary dosing device in an open surgical procedure could safely achieve the following goals:

The Pilot Dosing Study evaluated the safety and biological activity of two concentrations of

BB-301

(1.0+E13 vg/mL and 3.0+E13 vg/mL) across three distinct doses (1.0+E13 vg/mL, 3.0+E13 vg/mL with a low injection volume, and 3.0+E13 vg/mL with a high injection volume) following direct intramuscular injection into the Hypopharyngeus (HP) muscles and the Thyropharyngeus (TP) muscles of Beagle dogs via the use of a proprietary delivery device employed in an open surgical procedure. The HP muscle in Beagle dogs corresponds to the Middle Pharyngeal Constrictor muscle in human subjects, and the TP muscle in Beagle dogs corresponds to the Inferior Pharyngeal Constrictor muscle in human subjects.

BB-301

was injected only on Day 1 of the Pilot Dosing Study, and the corresponding canine pharyngeal muscles were harvested for analysis after 8 weeks of observation post-dosing.

BB-301

dosing was carried out by both a veterinary surgeon and a practicing Otolaryngologist who has extensive experience with the provision of palliative surgical care for OPMD patients.

Further data analyses are ongoing for the canine subjects treated in the

BB-301

Pilot Dosing Study, and the interim data-points highlighted here are derived from completed analyses of pharyngeal muscle tissues isolated from 6 Beagle dog subjects (of the

24-subject

study population). The

data-set

derived from the Pilot Dosing Study and the formal conclusions will be updated as additional study subjects are analyzed.

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The key preliminary results are summarized here:

Figure 7. Pharyngeal Muscle Tissue Transduction Levels for

BB-301

Regarding Gene Expression Levels Observed for

BB-301

Within the Pharyngeal Muscle Tissues (Figure 8, Figure 9, Figure 10):

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Figure 8. siRNA13 Expression Levels for

BB-301

within Pharyngeal Muscle Tissues

Figure 9. siRNA17 Expression Levels for

BB-301

within Pharyngeal Muscle Tissues

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Figure 10. coPABPN1 Expression Levels for

BB-301

within Pharyngeal Muscle Tissues

Regarding WildType PABPN1 Silencing (i.e. target “knock-down”) Observed for

BB-301

Within the Pharyngeal Muscle Tissues (Figure 11):

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Figure 11. PABPN1 Silencing (i.e. “target knock-down”) within Pharyngeal Muscle Tissues

Finally, it is critical to highlight the key methodological distinctions between the current

BB-301

Pilot Dosing Study in Beagle dogs conducted by Benitec and the prior Beagle dog dosing study carried out independently by the previous

BB-301

licensee of Benitec. The

BB-301

dosing study conducted by the prior

BB-301

licensee employed

non-ideal

routes and methods of

BB-301

administration to the target pharyngeal muscle tissues and employed similarly limited analytical methods at the completion of the dosing phase of the study. The Benitec team worked to optimize the route and method of administration of

BB-301

and to refine the core analytical methods employed following the completion of dosing.

Following these methodological improvements, Benitec demonstrated a

248-fold

improvement (+24,650%) in

BB-301

transduction of the HP muscle and a

111-fold

improvement (+11,027%) in

BB-301

transduction of the TP muscle relative to the levels of

BB-301

transduction observed by the previous

BB-301

licensee (Figure 12).

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Figure 12. Impact of Benitec-Initiated Methodological Improvements to the

BB-301

Large Animal Study Design on the Relative Pharyngeal Muscle Tissue Transduction Levels Achieved

In May 2021 Benitec completed a Scientific Advice Meeting with the National Agency for the Safety of Medicines and Health Products in France (L’Agence nationale de sécurité du médicament et des produits de santé or ANSM). The Scientific Advice Meeting was held to review the

BB-301

GLP Toxicology Study design, the

BB-301

GMP Clinical Manufacturing plan, and the design of the

First-in-Human

Clinical Trial for

BB-301.

Our team awaits the formal receipt of the final Meeting Minutes from the

BB-301

Scientific Advice Meeting. Benitec will provide updates related to each of the key data-points upon receipt of the final Meeting Minutes.

Additionally, Benitec will provide updated results derived from ongoing analyses of the animal subjects treated in the

BB-301

Pilot Dosing Study (for which interim data were originally disclosed in February 2021).

Benitec continues to plan for the initiation of the

First-in-Human

clinical study of

BB-301

in OPMD patients in 2022.

BB-103

for the Treatment of Hepatitis B

We are seeking strategic partners to continue the development of

BB-103

for the treatment of HBV. Results of in vivo and in vitro studies, from December 2016, March 2016 and December 2015, have, we believe, demonstrated the potential utility of an approach that combines RNAi with gene therapy to treat HBV. The Company may seek strategic partnerships to complete the

IND-enabling

studies for

BB-103.

The human hepatitis B virus is a small DNA virus that, according to the World Health Organization, infects up to 240 million people worldwide, resulting in up to 780,000 deaths per year. HBV infection can lead to differential outcomes, ranging from a silent, acute phase infection that can be resolved via the inherent action of the immune system, to a chronic infection requiring life-long therapy. In the case of a chronic HBV infection, the presence of viral proteins, particularly the hepatitis B surface antigen, can cause hepatic inflammation, liver dysfunction, acute hepatic failure, cirrhosis and, hepatocellular carcinoma.

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Current Hepatitis B Treatments

HBV predominantly exists as eight genotypes, designated A through H, with distinct geographic distribution.

According to GlobalData, a market research firm, the global hepatitis B therapeutics market was worth $2.4 billion in 2014 and is expected to reach a total value of $3.0 billion by 2024 at a Compound Annual Growth Rate of 2.4%. The current standards of care for HBV consist of antivirals composed of nucleotide and nucleoside analogues, or NUCs, and, less commonly, interferon therapy.

Most of the currently employed

anti-HBV

therapies can provide long-term viral load suppression, however, these therapeutic agents have modest cure rates and possess the additional risk of driving the development of drug-resistant mutations. The long-term use of interferon, particularly in high doses, may also be associated with significant side effects, including nausea, vomiting, shortness of breath, dizziness and fatigue, adding to issues with patient compliance for the course of treatment.

Our ddRNAi-based Hepatitis B

Therapeutic-BB-103

BB-103

is a ddRNAi-based therapeutic agent designed to target the liver and inhibit viral replication and surface-antigen production. The initial

in vivo

data for

BB-103

suggest that joint administration of

BB-103

and a NUC could support reactivation of the host immune response which is believed to be essential for the achievement of cure.

BB-103-Design

and Mechanism of Action

The design of the

BB-103

DNA construct takes advantage of the structure of the HBV genome. The hepatitis B virus is a small DNA virus with four overlapping open reading frames, meaning several genes are produced from the same DNA sequence by shifting the starting point of the translation process

(Figure 13B)

. These four genes are known as the core, surface, X and polymerase genes. The core gene encodes the core nucleocapsid protein, which is important in viral packaging and thought to help stabilize cccDNA, and the hepatitis B

e-antigen.

The surface gene encodes proteins, including

s-antigen.

The X gene encodes the X protein, which has properties that may be relevant to liver carcinogenesis. The polymerase gene encodes a large protein with functions critical for viral packaging and replication. Although HBV is a DNA virus, it replicates through an RNA intermediate.

BB-103

targets the viral mRNA at three overlapping regions of the genome

(Figure 13A and Figure 13B)

, simultaneously silencing the surface, X, core and polymerase genes. As a result, we believe that the long-term suppression of HBV viral replication, through silencing of the polymerase gene and the HBV RNA used for replication, the inhibition of HBV viral protein production, including

s-antigen

production, through silencing of the surface gene, and the inhibition of the cccDNA, through silencing of the core protein gene, could lead to eradication of HBV infection in patients by a single administration of

BB-103

when paired with a NUC.

In Vitro Development Highlights

Our bioinformatics analysis of the major HBV genotypes, A through H, has identified several well-conserved regions of the genome for targeting with ddRNAi therapeutics, and we have designed and evaluated numerous shRNAs to target these regions. The most advanced nonclinical construct is illustrated in Figure13A.

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Figure 13

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Figure 14

Regarding the mechanism of action of

BB-103,

the DNA construct is delivered to the nucleus of hepatocytes via an AAV8 vector. Upon reaching the nucleus the construct expresses three distinct shmiRs that are processed intracellularly to produce siRNAs that cleave the HBV mRNA and, thus, prevent the virus from replicating and producing viral proteins.

Intellectual Property

Benitec seeks to actively procure rights to and protect the intellectual property and proprietary technology that it believes is important to its business. Such intellectual property rights include patents claiming our ddRNAi and silence and replace technologies, as well as

know-how

and trade secrets related to our product candidates and proprietary technology.

ddRNAi-based treatment of Hepatitis B

The Benitec patent portfolio includes four patent families relevant to Benitec’s ddRNAi-based candidate for treatment of hepatitis B virus (HBV) infection

(BB-103).

This includes three patent families directed to RNAi agents targeting HBV and Benitec’s AAV patent family which covers the delivery system for

BB-103.

The first patent family directed to RNAi agents targeting HBV, entitled “

HBV Treatment (HBV family #1)

”, relates to single-stranded RNA and shRNA sequences to a range of target regions of the hepatitis B viral genome. Although drafted to explicitly cover shRNAs (as this was the RNAi format under development at the time), the claims encompass shRNAs comprised within a microRNA backbone (i.e., short hairpin microRNA (shmiR)) which is the format of RNAi currently in use within Benitec’s HBV program.

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A further patent family relating to shRNA sequences to a range of additional target regions of the hepatitis B viral genome was filed. This patent family is entitled “

Reagents for treatment of hepatitis B virus (HBV) infection

and use thereof (HBV family #2)

” and, although drafted to cover shRNAs (as this was the RNAi format under development at the time), the claims encompass shRNA and shmiR.

The third patent family relevant to HBV relates to the development of constructs. This patent family, entitled “

Reagents for treatment of hepatitis B virus (HBV) infection and use thereof (HBV family #3)

”, was filed to cover single and triple shmiR constructs currently under development at Benitec.

ddRNAi-based treatment for OPMD

Benitec’s patent portfolio for OPMD includes five patent families relating to shRNA and shmiRs targeting PABPN1 (the causative gene for OPMD), as well as ‘silence and replace’ therapeutics and treatment strategies for OPMD. These five families cover the OPMD therapeutic candidate,

BB-301,

under development at Benitec, treatment strategies for OPMD that silence PABPN1 which is causative for OPMD and replace with functional PABPN1, and Benitec’s AAV patent family which covers the delivery system for

BB-301.

BB-301

is a ‘silence and replace’ construct encoding two shmiRs targeting the endogenous PABPN1 (including variants causative of OPMD) internally designated

shmiR-13

and

shmiR-17,

as well as a codon-optimized PABPN1 replacement construct, the transcript of which is not targeted by

shmiR-13

and

shmiR-17.

Both shmiRs and the codon-optimized PABPN1 replacement construct are under the control of a muscle-specific promoter.

The first patent family, entitled “Reagents for treatment of oculopharyngeal muscular dystrophy (OPMD) and use thereof (OPMD family #1)”, arose out of a collaboration with Royal Holloway University of London (RHUL) and relates to three shRNA target regions within PABPN1. RHUL assigned its ownership interests in this patent family to Benitec, and the PCT application and the related U.S. priority document were filed solely in the name of Benitec. This patent family is directed to RNAi agents targeting specific regions within mutant PABPN1 variants causative of OPMD, as well as use of those RNAi agents in combination with PABPN1 replacement constructs to treat OPMD. More specifically, this family includes claims covering shmiR17 of

BB-301

This patent family entered the national/regional phase in October/November 2018.

The second patent family, entitled “Reagents for treatment of oculopharyngeal muscular dystrophy (OPMD) and use thereof (OPMD family #2)” relates to a second set of target gene sequences within PABPN1 as well as ‘silence and replace’ construct

BB-301

under development at Benitec. The PCT application and the related U.S. priority document were filed solely in the name of Benitec, and this family entered the national/regional phase in June/July 2019. This patent family is directed to RNAi agents targeting specific regions within mutant PABPN1 variants causative of OPMD, as well as ‘silence and replace’ constructs and use of same for treatment of OPMD. More specifically, this family includes claims covering shmiR13 and shmiR17 of

BB-301

separately, as well as the full

BB-301

‘knockdown and replacement’ construct.

A third patent family, entitled “Methods for Treating Oculopharyngeal Muscular Dystrophy (OPMD) (OPMD family #3)” has been filed to pursue claims which are broadly directed to the ‘silence and replace’ treatment concept for OPMD, relying on RNAi agents to knockdown PABPN1 and replacement with functional PABPN1 which is not targeted by the RNAi agents. The claims in this application are not limited to

BB-301.

This patent family exists as a PCT application and was filed solely in the name of Benitec.

A fourth patent family, entitled “Methods for Treating Oculopharyngeal Muscular Dystrophy (OPMD) (OPMD family #4)” has been filed to specifically claim the OPMD therapeutic candidate developed by Benitec,

BB-301

(described herein). This patent family exists as a PCT application and was filed solely in the name of Benitec.

AAV with modified phospholipase domain

The Benitec patent portfolio includes a single patent family, entitled “

Adeno-associated virus (AAV) with modified phospholipase domain

,” which relates to an AAV having a modified phospholipase (PLA2) domain in

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the capsid. The modified AAV will be used as the delivery system for the OPMD therapeutic candidate and the HBV therapeutic candidate.

We are aware of a third party patent directed to AAV vectors that expires in 2026. In the event we receive regulatory marketing approval before the expiration date it may be necessary for us to obtain a license to the patent in order to commercialize. We cannot guarantee the availability of the license or that it can be obtained on commercially reasonable terms.

Know-How

In addition to patent protection of ddRNAi and other technology and our product candidates, we also rely on proprietary

know-how

that is not patentable or that we elect not to patent, as valuable intellectual property for our business. This

know-how

is related to the areas of, among others, identifying nucleic acid targets for ddRNAi technology and designing ddRNAi constructs for targeting preferred genes. We have implemented a number of security measures designed to safeguard our

know-how

including limiting access to our research facilities, databases and networks. We also seek to protect our

know-how

by way of confidentiality agreements when engaging with external providers for progressing our pipeline of therapeutic candidates.

Laws and Regulations Regarding Patent Terms

The term of individual patents depends upon the legal terms of the patents in the countries in which they are obtained. In most countries in which we file, the patent term is 20 years from the earliest date of filing a

non-provisional

patent application. In the United States, a patent term may be shortened if a patent is terminally disclaimed over another patent or as a result of delays in patent prosecution by the patentee. A patent’s term may be lengthened by a patent term adjustment, which compensates a patentee for administrative delays by the USPTO in granting a patent. The patent term of a European patent is 20 years from its filing date, which, unlike in the United States, is not subject to patent term adjustments.

The term of a patent that covers an

FDA-approved

biologic may also be eligible for patent term extension, which permits patent term restoration as compensation for the patent term lost during the FDA regulatory review process. The Drug Price Competition and Patent Term Restoration Act of 1984, or the Hatch-Waxman Act, permits a patent term extension of up to five years beyond the expiration of the patent. The length of the patent term extension is related to the length of time the biologic is under clinical testing regulatory review. Patent extension cannot extend the remaining term of a patent beyond a total of 14 years from the date of product approval and only one patent applicable to an approved biologic may be extended. Similar provisions are available in Europe and other jurisdictions to extend the term of a patent that covers an approved biologic although the eligibility requirements for any duration of such extension vary. In the future, if and when our products receive FDA approval, or approval from an equivalent regulatory body in another jurisdiction in which patent protection is sought or obtained, we expect to apply for patent term extensions on patents covering those products.

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Trademarks

Our trademarks include registrations for company branding and product names for our pipeline in development. The trademarks that we use in connection with our business include the following:

USA BENITEC BIOPHARMA 86190065 Registered

USA SILENCING GENES FOR LIFE 86488147 Registered

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