Annual
Report
2022
2 ULTIMOVACS2022
Ultimovacs at a glance
About Ultimovacs
Interview with Chief Scientific Officer
Letter from the CEO
4
5
6
8
ESG Report
Corporate Governance Report
The Board of Directors
Financial Statements
Notes
Financial Statements
Notes
Auditor’s Report
40
46
54
58
62
90
94
118
Board of Director’s overview of 2022
Highlights
Clinical trial overview
Operational overview
The cancer treatment landscape
Financial overview
Environment and Governance
Risks and uncertainties
Going concern
Subsequent events
Outlook
Responsibility statement
10
11
12
23
27
31
33
34
36
36
37
38
CONTENTS
02
05
01 03
04
Overview
Governance
Financial Statements
- Ultimovacs Group
Directors’ report
Financial Statements
- Ultimovacs ASA
3 ULTIMOVACS2022
Overview
01
Ultimovacs at a glance
About Ultimovacs
Interview with Chief
Scientific Officer
Letter from the CEO
Chapters
1
2
3
4
5
4 ULTIMOVACS2022
Ultimovacs at a Glance
A clinical stage immuno-oncology biotech
company on a mission to extend and
improve the lives of patients.
UN Sustainable
development goals
• Target expressed in
85-90% of cancers at all
stages at tumor life
• Used in combination with
immune checkpoint inhibitors
(CPI)
• Off-the-shelf, easy to use
• Combines adjuvant and vaccine
antigen in same molecule
• Can be applied to many types
of cancers and multiple product
candidates
TECHNOLOGY PIPELINE
• Four studies, total of 82 patients (in follow-up)
• Strong signals of clinical efficacy and good safety
• Dual Fast Track and Orphan Drug designations
for malignant melanoma from FDA
• Prostate cancer, non-small cell lung cancer,
malignant melanoma (two studies)
• Five studies, combination with five CPIs,
>670 patients to be enrolled, 100 hospitals, 15
countries
• Malignant melanoma, mesothelioma, head and
neck cancer, ovarian cancer, non-small cell lung
cancer
• Studies completed enrollment in 2022: INITIUM
(NIPU in January 2023)
• Readouts expected from H1 2023
Pre-clinical / Clinical
• TENDU - prostate cancer (enrollment
completed in 2022)
25 employees from 7 nationalities
Offices in Norway & Sweden
Listed on the Euronext Oslo Stock
Exchange (OSE: ULTI)
Total cash year-end 2022: MNOK 425
(appr. MUSD 43)
Financial runway to mid-2024
Debt free
Market cap year-end 2022: NOK 3.8
billion (appr. MUSD 380)
OTHER HIGHLIGHTS
UV1 - Universal cancer vaccine
TET - Technology platform
Phase I:
Phase II:
Phase I:
Chapters
2
3
4
5
1
5 ULTIMOVACS2022
About Ultimovacs
Ultimovacs ASA is a clinical-stage biotech company developing novel immunotherapies
against cancer. The Company was founded in 2011 and was listed on the Euronext Oslo Stock
Exchange (ULTI) in 2019. In 2022, Ultimovacs had a team of 25 people. At year-end, total cash
was MNOK 425 and market cap NOK 3.8 billion.
Lead product, UV1, is a proprietary universal cancer vaccine aiming to enhance the efficacy and durability
of immuno-oncology therapies when combined with checkpoint inhibitors. UV1 triggers an immune
response against cells expressing telomerase, which is present in 85-90% of
cancer cell types at all stages of tumor growth. UV1 is off-the-shelf, easy to
use, with broad applicability across cancer indications. The UV1 vaccine is based
on preclinical and clinical research on immunotherapies conducted at the Oslo
University Hospital.
The Company is advancing a broad clinical development program with the cancer
vaccine UV1 in five Phase II randomized, comparative clinical trials, investigating
UV1 in combination with different checkpoint inhibitors. The studies are conducted
at more than 100 hospitals in Europe, the US and Australia, enrolling more than
670 patients:
• INITIUM (156 patients): First line metastatic malignant melanoma, UV1 with nivolumab and
ipilimumab. Sponsored by Ultimovacs. Readout: H1 2023.
• NIPU (118 patients): Second line pleural mesothelioma, UV1 with nivolumab and ipilimumab.
Sponsored by Oslo University Hospital, supported by Bristol-Myers Squibb and Ultimovacs.
Readout: H1 2023.
• FOCUS (75 patients): First line head and neck cancer, UV1 with pembrolizumab. Sponsored by
University Medicine Halle, Germany, supported by Ultimovacs. Readout: H1 2024.
• DOVACC (184 patients): Second line ovarian cancer, UV1 with durvalumab and olaparib (PARP
inhibitor). Sponsored by the Nordic Society of Gynaecological Oncology and the European Network
of Gynaecological Oncological Trial Groups, supported by AstraZeneca and Ultimovacs. Readout:
H2 2024.
• LUNGVAC (138 patients): First line non-small cell lung cancer, UV1 with cemiplimab. Sponsored by
Drammen Hospital/Vestre Viken, Norway, supported by Ultimovacs. Readout: H2 2025.
Treatment with UV1 has been assessed in three early Phase I studies (metastatic prostate cancer, metastatic
non-small cell lung cancer and metastatic malignant melanoma) in 52 patients at the Oslo University
Hospital. Ultimovacs is the sponsor of the ongoing Phase I UV1-103 study evaluating the safety and tolerability
of treatment with UV1 and pembrolizumab in 30 patients in the US with metastatic malignant melanoma.
Ultimovacs is expanding its pipeline using its proprietary TET adjuvant platform technology that can
generate vaccine candidates to a broad range of target antigens.
Chapters
2
3
4
5
1
6 ULTIMOVACS2022
Article published in Biostock 13 December 2022
The innovative force behind Ultimovacs’ cancer
vaccine UV1
Ultimovacs’ broad clinical pipeline evaluating the universal cancer vaccine UV1
is the culmination of decades of research led by one of the pioneers in cancer
immunotherapy, Professor Gustav Gaudernack.
Already in the late 1970’s and early 1980’s immunotherapists began tinkering
with the idea of vaccines against cancer. One of these researchers was Gustav
Gaudernack. In the 90’s as Professor and Head of the Unit for Immunotherapy
at Radiumhospitalet in Oslo, Gaudernack began developing what is now
Ultimovacs’ lead product, UV1.
Since then, Professor Gaudernack has initiated over 20 clinical studies
in cancer vaccination, including the first peptide vaccine study in cancer
worldwide. He has more than 50 patents and 15 licenses for monoclonal
antibodies, cancer vaccines, and cancer diagnostics. Ultimovacs was founded
upon Gaudernack’s work in 2011, and he continues to play a pivotal role at the
company as Chief Scientific Officer.
Professor Gaudernack, what led you to the idea of a vaccine against cancer?
As a biology student at the University of Oslo in the early 1960s, I learned that many cancer forms in research
animals are due to infection by certain viruses. It was then obvious to me that vaccination against such viruses
could potentially have an impact on cancer development, both at the level of prevention and as a novel treatment
modality. The problem at that time was that similar viruses were not known to cause common human cancers.
At what stage in your career did you realise that such a vaccine could become a reality?
It was a stepwise process. It all started in 1973 as a research fellow at the newly established Arctic University in
Tromsø, Norway. My project was to vaccinate mice against a tumour called MOPC-315. We made two important
observations: 1. antibodies generated against the vaccine were actually hitting their target in the mice; 2.
vaccination also generated a T-cell response against the vaccine.
With the identification of the enzyme telomerase as the immortalising factor in virtually all forms of cancer, a
new target, TERT (telomerase reverse transcriptase), emerged as a candidate for a universal cancer vaccine
in humans. In collaboration with HYDRO AS, we synthesized and tested a large number of potential candidate
peptides to identify the ones that were most frequently recognised by blood samples from a large number of
cancer patients. These efforts led to the development of the first-generation telomerase vaccine, GV1001.
After 10 years of clinical trials with GV1001 in multiple indications, we were able to collect long-term follow-up
clinical data and put together a large biobank of blood samples from vaccinated patients. We investigated
“epitope spreading” - an interesting immunological phenomenon suggesting that the immune system is able to
perform more efficiently. So, we studied whether GV1001 vaccination would result in a novel immune response
against other parts of h-TERT, and we were able to show that this was indeed the case. These data resulted in the
design of a second-generation vaccine, UV1, and the founding of the start-up company Ultimovacs ASA.
Gustav Gaudernack, Chief
Scientific Officer
Chapters
3
4
5
1
2
7 ULTIMOVACS2022
Now, decades later, cancer vaccines are a big presence in the immuno-oncology space. What are your
thoughts as you look back at the progress made within the field?
The field of cancer vaccines has made considerable progress over the last 30 years, mainly due to fundamental
changes in the understanding of how the immune system operates and on the technological development. One
negative factor, in my opinion, was that the development was for many years side-tracked by what was almost an
obsession for development of vaccines based on short peptides designed to generate tumour-specific cytotoxic
T-cells. This strategy failed to recognise the role of helper T-cells in orchestrating a stronger, broader and more
complete T-cell response. The other factor that stands out is the now recognised role of immune checkpoints -
the true clinical potency of cancer vaccines can only be revealed in combination with checkpoint inhibitors (CPIs).
Cancer remains one of the deadliest diseases, causing a heavy burden, not only on patients and their loved
ones, but on society as a whole. How much work still needs to be done to find a cure, and are cancer
vaccines part of that equation?
A final cure for all cancer at every stage in life is an uphill fight against evolutionary forces in biology. The task,
as I see it, is to find better treatments, i.e., more efficient and with fewer side effect. This is well within the scope
of what can be obtained by immunotherapy. The occurrence of a pre-existing spontaneous immune response
against a patient’s tumour is the cornerstone of current cancer immunotherapy, on which the mode of action of
CPIs rests. These responses are, by their nature, not under a physician’s control.
Therapeutic cancer vaccines represent a unique and complementary approach to mainstream tumour
immunotherapy, i.e., CPIs, aiming to provide a new wave of cancer-specific T-cells in patients with various forms
of cancer. Cancer vaccines may thereby supplement and reinforce pre-existing cancer immune responses and
pave the way for synergy with any CPI and other cancer drugs designed to improve tumour immunity. Cancer
vaccines are thus definitely part of the equation.
Shifting gears, what makes UV1 stand out among other types of cancer immunotherpies being developed?
UV1 is standing out as a unique vaccine both by virtue of the expression of its target, h-TERT, which is expressed in
over 90 per cent of all cancers, and by its history as a second-generation vaccine, building on 10 years of experience
and treatment of over 1000 patients with the first-generation vaccine, GV1001. h-TERT is THE immortalising factor
giving cancer cells unlimited power to grow. Tumours are notoriously unstable, and a moving target for therapy.
h-TERT is present from the earliest stage of tumour development and throughout the life and evolution of a
tumour in the patients. No other tumour target matches this property.
Finally, what are your expectations for UV1 and Ultimovacs as the company goes deeper into clinical
development?
I expect to see UV1 used in an increasing number of cancer indications, in combination with the currently used CPIs
and with novel CPIs and other drugs that may amplify the generation of UV1 specific T-cells during vaccination
and facilitate the function of UV1 specific T-cells within the tumour microenvironment. I expect that UV1 will
be used in earlier phases of tumour development such as the neo-adjuvant setting. I also believe that we will
later move into the prophylactic setting, starting with patients having a high risk of developing cancer, either by
exposure to carcinogens such as asbestos or by genetic disposition, such as variants/mutations in the h-TERT
gene or other inherited cancer disposing genes.
Telomerase reverse transcriptase (hTERT) (source: The UniProt Consortium, UniProt: the Universal Protein
Knowledgebase in 2023 Nucleic Acids Res. 51:D523–D531 (2023))
Chapters
3
4
5
1
2
8 ULTIMOVACS2022
Letter from the CEO:
2022 - a year of progress and preparation
covering key value inflection points including the results from the Phase II trials INITIUM, NIPU and FOCUS.
Enrollment in our two most advanced randomized Phase II studies, INITIUM, in patients with malignant
melanoma, and NIPU, in patients with pleural mesothelioma, was completed in June 2022 and January
2023, respectively, marking significant milestones for Ultimovacs. Completing enrollment of 156 patients in
INITIUM during the pandemic in only 24 months was an impressive feat.
Ultimovacs has three other Phase II studies in our UV1 Phase II clinical program, evaluating the hypothesis
that UV1 can increase treatment efficacy in several cancer types, agnostic to what standard of care
checkpoint inhibitor it may be combined with. As of the Q4 2022 report, we have enrolled more than 340
patients in total in the Phase II program, including 145 patients enrolled in 2022. We are sincerely grateful
for the dedication and participation of each study site, investigator, and patient.
We also advanced the work on our vaccine adjuvant technology platform, completing enrollment in the
Phase I TENDU trial in prostate cancer in December 2022. This study is designed to understand the safety
and tolerability of the TET vaccine in a small number of patients. We expect to report the initial results
from this study in H2 2023.
Analysis of biomarker data from the UV1-103 study strengthened our belief in UV1 as a potential candidate
that can bring a meaningful difference to cancer patients. These results reinforce our belief that UV1
can play a transformative role in the treatment of patients with solid tumors, as backbone therapy in
combination with immune checkpoint inhibitors.
Although cancer vaccines have been in development for more than 20 years, the landmark deal by Merck
and Moderna last year has brought a lot more attention from the medical and investor communities and
the general public, to this sector. With that perspective in mind, the results of INITIUM and NIPU, expected
during the first half of this year, could be transformative — for Ultimovacs, cancer patients, developers of
cancer vaccines and biotech investors. We believe that a universal cancer vaccine like UV1 has the potential
to make a meaningful difference in the treatment of cancer patients. We are ready to move forward fast
on the back of good data.
I am inspired by the dedication and professionalism of the Ultimovacs team which is delivering these
results. I am grateful to our shareholders, collaborators and stakeholders around the world. Thank you for
believing in us and supporting us. These are exciting times for Ultimovacs. We are well prepared for our first
Phase II data, and I look forward to updating you on our important progress in 2023.
Carlos de Sousa, Chief Executive Officer
I am pleased to summarize 2022 on a positive note. Despite what has been
a turbulent year for the biotech industry, Ultimovacs is on track, continuing
strong progress in developing a novel cancer vaccine which enables the
immune system to fight cancer.
Ultimovacs made important steps in 2022 in the development of a universal,
off-the-shelf cancer vaccine that can be used in combination with immune
checkpoint inhibitors to treat various solid tumor cancers. The team entered
last year with optimism after the announcement of the fifth UV1 Phase II
study in non-small cell lung cancer, Fast Track and Orphan Drug designations
from the FDA as a recognition of our Phase I data in melanoma, and an
oversubscribed capital raise during challenging market conditions in October
2021. As a result, our expected cash runway now extends into mid-2024,
Chapters
2
3
4
5
1
9 ULTIMOVACS2022
Directors’
report
02
Environment and
Governance
Risks and uncertainties
Going concern
Subsequent events
Outlook
Responsibility
statement
Board of Directors’
overview of 2022
Highlights
Clinical trial overview
Operational overview
The cancer treatment
landscape
Financial overview
Chapters
2
3
4
5
1
10 ULTIMOVACS2022
Directors’ Report
Board of Director’s overview of 2022
Ultimovacs’ mission is to develop a universal, off-the-shelf, cancer vaccine that could be used in
combination with immune checkpoint inhibitors to improve clinical outcomes in cancer patients around
the world.
2022 will be remembered as a year of solid performance and preparation by the Ultimovacs team in
support of its mission, as it readies to release the results of its first comparative Phase II studies, INITIUM
and NIPU, with lead product candidate, UV1, in H1 2023.
Ultimovacs’ strong performance, evidenced by the enrollment in 2022 of a total of 145 patients in the
overall Phase II UV1 program, was based on the dedication of its 26-person team and the strength of
its good relationships with leading clinical investigators and study sites across Europe and the U.S. We
are grateful for the good work of the team and our collaborators and the wide support system that the
Company has cultivated to advance the clinical programs.
Immune checkpoint inhibitors have opened the door for the body’s immune system to fight cancer. While
these medicines have become a cornerstone of cancer treatment, depending on indication, only a minority
of patients have a durable response. Therefore, there is still a serious unmet medical need for medicines
that can further enhance treatment responses to immune checkpoint inhibitors and deliver improved
treatment outcomes. Ultimovacs aims to address this need, based on technology developed through
decades of immunotherapy research and strong scientific results from Oslo University Hospital, led by
Chief Scientific Officer and Ultimovacs co-founder, Gustav Gaudernack.
The combination of UV1 and checkpoint inhibitor treatment may have the potential to transform cancer
care by providing improved and more durable treatment responses to patients across a range of tumor
types and combination regimens. Ultimovacs’ aspiration is to demonstrate that the use of UV1 is not
restricted to one checkpoint inhibitor – but rather that it can be effectively used in combination with
several different checkpoint inhibitors in multiple cancer types.
The ambitious Phase II clinical program has been designed to prove this hypothesis by evaluating the
potential clinical efficacy of UV1 using five different checkpoint inhibitors, ipilimumab, nivolumab,
pembrolizumab, durvalumab and cemiplimab, in a range of five solid tumor cancers; malignant melanoma,
pleural mesothelioma, malignant melanoma, head and neck cancer, ovarian cancer and non-small cell
lung cancer. Since clinical success or failure in one trial does not necessarily directly read through to other
trials, it was important to include different checkpoint inhibitors and tumor types to spread clinical and
business risks while providing a broad and comprehensive evaluation of UV1 in multiple cancer settings.
Ultimovacs is looking forward to reporting the top line results of the Phase II studies in malignant melanoma
(INITIUM) and in pleural mesothelioma (NIPU) in H1 2023. These comparative studies are designed and
powered to provide clinically meaningful results. Positive results from one or both studies could provide
proof-of-concept and help to define the regulatory and clinical pathways for UV1. Further, the results
could be instrumental in developing our commercial plans for UV1, to potentially include a global strategic
partnership, and enable us to achieve our goal of improving the treatment of cancer patients worldwide.
Looking ahead to 2023, results of the Phase II studies have the potential to be transformative for Ultimovacs
and the field of cancer vaccines. These studies, and the entire clinical program, are the result of many years
of diligent research and dedication by Ultimovacs’ founders, scientists and clinicians, the incredible efforts
of numerous patients and the support of the entire Ultimovacs team, investors, and collaborators. We look
forward to updating the investment and oncology communities with our progress throughout the year.
Board of Directors
Chapters
3
4
5
1
2
11 ULTIMOVACS2022
Highlights
Key highlights of the year 2022
• On 25 March 2022, Ultimovacs reported the complete disappearance of tumors in yet another
patient in the UV1-103 study in malignant melanoma, raising the complete response rate in the
study to 33%. The objective response rate remained the same at 57%.
• On 22 April 2022, Ultimovacs received a Notice of Allowance from the United States Patent and
Trademarks Office (USPTO) concerning its US patent application on the use of vaccine-checkpoint
inhibitor combinations to treat cancer.
• On 20 June 2022, Ultimovacs announced positive 2-year overall survival data in UV1-103. Across all
30 patients in the study, the 24-month overall survival rate was 73%. Patients will continue to be
followed for long-term survival.
• On 30 June 2022, Ultimovacs completed the recruitment of the 154 planned patients in the INITIUM
trial. Two additional patients were enrolled in July 2022, bringing the final number of patients
enrolled to 156.
• On 22 August 2022, Ultimovacs received a Notice of Allowance from the United States Patent and
Trademarks Office (USPTO) concerning its US patent application covering methods for eliciting a
T cell immune response with the UV1 universal cancer vaccine.
• On 5 October 2022, Ultimovacs announced positive three-year results of a 71% overall survival rate
in Cohort 1 of the UV1-103 trial in metastatic malignant melanoma.
• On 18 October 2022, Ultimovacs ASA announced multiple biomarker analyses data from the phase
I UV1-103 malignant melanoma trial. The analyses of biological samples from the UV1-103 study
support the promising efficacy signals, including enhanced efficacy in ‘hard-to-treat patients’.
• On 25 October, Ultimovacs announced that the first patient had been randomized in the phase II
LUNGVAC trial.
• On 14 December 2022, Ultimovacs announced that the last patient was enrolled in the Phase
I TENDU trial in prostate cancer, the first in-human study based on the Company’s novel TET
platform.
• On 20 December 2022, Ultimovacs announced that as of January 1st, 2023, UV1 would be combined
with the PD-1 checkpoint inhibitor cemiplimab, instead of pembrolizumab, in the LUNGVAC trial,
following the decision to change of reimbursement of PD-1 checkpoint inhibitor from the Norwegian
health authorities.
• On 23 January 2023, Ultimovacs announced that patient enrollment was completed in the NIPU
Phase II clinical trial in metastatic pleural mesothelioma (post period event).
Clinical trial enrollment update
• INITIUM trial: The enrollment of patients was completed in June 2022 with a total of 156 patients.
Enrollment is ongoing in the single arm supplementary study (not to be included in the INITIUM
topline readout).
• NIPU trial: 114 patients have been enrolled as per 31 December 2022, up from 58 as of the 2021
Annual Report. The enrollment of all 118 patients was completed in January 2023.
• FOCUS trial: 45 patients have been enrolled as per 31 December 2022, up from 9 as of the 2021
Annual Report. 50 patients have been enrolled as of the Q4 2022 reporting date.
• DOVACC trial: 10 patients have been enrolled as per 31 December 2022, up from 1 as of the 2021
Annual Report. 17 patients have been enrolled as of the Q4 2022 reporting date.
• LUNGVAC: 2 out of 138 patients have been enrolled and treated with cemiplimab as of the Q4 2022
reporting date.
• TENDU trial: All 12 patients have been enrolled as per 31 December 2022.
Chapters
3
4
5
1
2
12 ULTIMOVACS2022
Clinical trial overview
Lead product candidate: UV1
The Company’s lead product candidate is UV1, a second-generation peptide-based cancer vaccine inducing
a specific T cell response against the universal cancer antigen telomerase (hTERT), which is expressed at a
high level in 85-90% of human tumors.
UV1’s mode of action is to make the immune system produce CD4 T cells (i.e., T helper cells) that recognize
cancer cells expressing telomerase. UV1 does not interfere with the activity of telomerase; no material
safety issues have been observed to date.
UV1 expands T-cells that identify fragments of telomerase presented in the context of HLA molecules on
cells in the tumor. This triggers an immune response against the cancer. UV1 may potentially be applied
universally across cancer types, in different stages of disease and in combination with different cancer
treatments. The vaccine is easy to use and does not require sophisticated infrastructure in hospital. UV1 is
manufactured as an off-the-shelf product with a long shelf life.
UV1 is being developed as a therapeutic cancer vaccine for use in combination with other immuno-oncology
drugs which require an ongoing T cell response for their mode of action. Longer-term, it would be attractive
to investigate the use of UV1 in neo-adjuvant treatment.
Treatment with UV1 has been assessed in three Phase I studies (metastatic prostate cancer, metastatic
non-small cell lung cancer and metastatic malignant melanoma) in 52 patients at the Oslo University
Hospital. The observed clinical outcomes from these three trials served as a strong basis for the further
clinical development of UV1, with respect to safety, immune response, and signals of clinical effect.
In addition, Ultimovacs is the sponsor of the fully enrolled and ongoing Phase I clinical study UV1-103 in
the U.S. evaluating the safety and tolerability of treatment with UV1 and the PD-1 checkpoint inhibitor
pembrolizumab in 30 patients with metastatic malignant melanoma.
UV1 is currently being evaluated in five Phase II randomized clinical trials in five different cancer types and
in combination with different checkpoint inhibitors. The Phase II program will enroll more than 670 patients
at approximately 100 hospitals in Europe, the US and Australia.
UV1 is a patented, proprietary technology owned by Ultimovacs.
Chapters
3
4
5
1
2
13 ULTIMOVACS2022
UV1 Phase II trials overview
UV1 is potentially effective across a broad range of cancer types as telomerase is expressed in most
cancers. The mechanism of action of the CPIs are also not cancer type dependent. The data from clinical
trials and accompanying biological studies therefore has significant implications for other cancer types and
indications.
Ultimovacs has an extensive development program with five Phase II studies in five different indications
including more than 670 patients. Two Phase II studies, INITIUM in malignant melanoma and NIPU in
mesothelioma, commenced in 2020 and are fully enrolled. The FOCUS trial in head and neck cancer and
DOVACC in ovarian cancer started patient recruitment in the last quarter of 2021, and LUNGVAC in non-
small cell lung cancer (NSCLC) started patient enrollment in Q4 2022.
Chapters
3
4
5
1
2
14 ULTIMOVACS2022
INITIUM
The trial
INITIUM is an Ultimovacs-sponsored randomized, multi-center Phase
II trial in which the universal cancer vaccine, UV1, will be evaluated in
combination with the checkpoint inhibitors ipilimumab and nivolumab for
first-line treatment of patients with metastatic malignant melanoma.
The first INITIUM patient was treated at the Oslo University Hospital
(OUS) in June 2020, and the last patient was enrolled in the study in July
2022. The initial study design called for enrollment of 154 patients. Two
additional patients were enrolled bringing the total number of patients in
the study to 156. A total of 39 hospitals are participating in this trial being
run in the US, UK, Belgium and Norway. Dr. Karl Lewis, University of
Colorado Hospital (U.S.), is the International Coordinating Investigator of the INITIUM trial.
Half the 156 patients enrolled in the trial have been dosed with UV1 plus the PD-1 checkpoint inhibitor
nivolumab and the CTLA-4 checkpoint inhibitor ipilimumab, while the other half received nivolumab and
ipilimumab. The readout of the primary endpoint of progression-free survival is expected in H1 2023, after
progression of cancer or death has been observed in 70 patients. Secondary endpoints include overall
survival (OS), objective response rate (ORR), duration of response (DOR) and safety. The objective of the
study is to achieve a clinically meaningful progression-free survival (PFS) benefit in patients with metastatic
malignant melanoma. The study also includes a program for assessment of UV1 related biomarkers.
With the INITIUM enrollment completed, Ultimovacs is running a supplementary study to the INITIUM trial
with 20 patients in a single arm. Patient enrollment in the supplementary study started in September
2022. The objective of the study is to provide further characterization of the manner in which an immune
response specific to the UV1 vaccine, translates into anti-tumor activity and clinical benefit for patients.
These patients will receive experimental treatment, i.e. the triple combination of UV1, ipilimumab and
nivolumab. Data collected from the patients in the supplementary study will not be part of the primary and
secondary endpoint analyses of INITIUM and will not affect the timeline for topline read-out.
The combination drugs
Ipilimumab is a monoclonal antibody medication that works to activate the immune system by targeting
CTLA-4, a protein receptor that downregulates the immune system. Ipilimumab works by making it difficult
for the CTLA-4 to bind to B7. Ipilimumab was the first checkpoint inhibitor to reach the market.
Nivolumab is a human IgG4 monoclonal antibody that blocks PD-1. It works as a checkpoint inhibitor,
blocking a signal that prevents activation of T cells from attacking the cancer.
Both nivolumab and ipilimumab are checkpoint inhibitors from Bristol-Myers Squibb (BMS).
Malignant melanoma
Melanoma is a type of skin cancer that develops when melanocytes (the cells that give the skin its tan or
brown color) start to grow out of control. Melanoma is much less common than some other types of skin
cancers. But melanoma is more dangerous because it’s much more likely to spread to other parts of the
body if not recognized and treated early. Melanomas can develop anywhere on the skin, but they are more
likely to start on the trunk (chest and back) in men and on the legs in women. The neck and face are other
common sites.
World-wide, more than 320,000 new cases of melanoma are diagnosed every year and it is estimated
that more than 50,000 people die from metastatic melanoma every year (Source: Globoscan). There is a
large unmet medical need for improved treatment of melanoma. There is a good theoretical rationale for
combining a universal cancer vaccine with PD-1 and CTLA-4 blockade that will work to open the tumor and
strengthen the immune response.
Chapters
3
4
5
1
2
15 ULTIMOVACS2022
NIPU
The trial
NIPU is a randomized, multi-center Phase II trial in which the universal
cancer vaccine, UV1, will be evaluated in combination with the checkpoint
inhibitors ipilimumab and nivolumab as second-line treatment in
metastatic pleural mesothelioma. Professor MD PhD Åslaug Helland is the
principal investigator for the trial, which is sponsored by Oslo University
Hospital (OUS). Bristol-Myers Squibb and Ultimovacs have entered into
agreements with OUS to support the preparations and execution of the
trial.
The first patient in the NIPU trial was treated at the Oslo University Hospital
in June 2020, and the last patient was enrolled in January 2023. The study is being conducted in 118
patients in five countries (Norway, Sweden, Denmark, Spain, and Australia). Half of the patients in the trial
have been treated with the combination of UV1, ipilimumab and nivolumab and the other half have been
treated with ipilimumab and nivolumab. The readout of the primary endpoint of progression-free survival
is expected in H1 2023, after progression of cancer or death has been observed in 69 patients. Secondary
endpoints include overall survival (OS), objective response rate (ORR), duration of response (DOR) and
safety. The objective of the study is to achieve a clinically meaningful progression-free survival (PFS)
benefit in patients with metastatic pleural mesothelioma (MPM) after progression on first-line standard
platinum doublet chemotherapy.
Malignant pleural mesothelioma
MPM is a rare malignant tumor originating from the cells lining the mesothelial surface in the lungs and is
the most common type of mesothelioma. It is a disease with a high unmet medical need with a median
overall survival of approximately 1 year. It is a fatal form of thoracic cancer that is diagnosed in more than
30,000 people anually, and kills over 25,000 people every year (Source: Globoscan).
Most patients are treated with palliative chemotherapy. Recently, ipilimumab and nivolumab have been
approved as 1st line therapy for this patient group. Patients with disease progression after first-line therapy
have few therapeutic options. Asbestos exposure is heavily linked to the development of the disease. It may
take 10 - 50 years for symptoms of mesothelioma to manifest after initial asbestos exposure. Even though
the use of asbestos to a large extent is banned today, new incidences of mesothelioma will continue to be
a medical challenge for decades. 0ver 500,000 people were exposed to toxic dust including asbestos during
the September 11 attacks in 2001 and a significant local rise in incidence is expected in decades to come.
Compared to many other cancer types, the incidence numbers are low, however the medical need is very
high. There is therefore a significant market opportunity for an improved therapy for mesothelioma.
Chapters
3
4
5
1
2
16 ULTIMOVACS2022
FOCUS
The trial
The FOCUS trial (First-line metastatic Or recurrent HNSCC/Checkpoint
inhibitor UV1 Study) is an investigator-sponsored, randomized Phase II
clinical trial that will recruit patients with recurrent or metastatic PD-
L1 positive head and neck squamous cell carcinoma. The trial will be
conducted at 10 sites across Germany and led by principal investigator
Professor Mascha Binder, M.D., Medical Director and Head of the
Immunological Tumor Group at University Medicine Halle, Germany, a
renowned oncology clinician and researcher specializing in the analysis
of immuno-oncology treatments and their interaction with tumor tissues.
The trial will evaluate the addition of UV1 to a standard of care treatment with the PD-1 checkpoint inhibitor
pembrolizumab as compared to pembrolizumab monotherapy. A total of 75 patients indicated for treatment
with pembrolizumab will be enrolled in the FOCUS study, randomized 2-to-1 so that 50 patients will receive
UV1 and pembrolizumab and 25 patients will receive pembrolizumab alone. The first patient in the FOCUS
trial was treated in August 2021. 45 patients have been enrolled as per 31 December 2022, and 50 patients
as of the Q4 2022 reporting date. The FOCUS trial is a landmark study. The primary endpoint of the study
is progression-free survival rate at 6 months after the last patient has been enrolled. Secondary endpoints
include overall survival (OS), objective response rate (ORR), duration of response (DOR) and safety.
Topline readout is expected in H1 2024.
The combination drug
Pembrolizumab is a PD-1 checkpoint inhibitor that targets the programmed cell death 1 (PD-1) receptor.
Pembrolizumab is standard of care in multiple indications and currently the most widely used checkpoint
inhibitor in the world.
Head and neck cancer
“Head and neck cancer” is the term used to describe a number of different malignant tumors that develop in
or around the throat, larynx, nose, sinuses, and mouth. Globally, head and neck cancer accounts for around
370,000 new cases of cancer and 170,000 deaths annually (Source: Globoscan). The usual age at diagnosis
is between 55 and 65 years old and the average 5-year survival following diagnosis in the developed world
is 42-64%.
Chapters
3
4
5
1
2
17 ULTIMOVACS2022
DOVACC
The Trial
DOVACC (Durvalumab Olaparib VACCine) is a multicenter, randomized
Phase II clinical collaboration trial with the Nordic Society of
Gynaecological Oncology – Clinical Trial Unit (NSGO-CTU), the European
Network of Gynaecological Oncological Trial Groups (ENGOT), AstraZeneca
and Ultimovacs. This second-line maintenance study will enroll patients
with high-grade BRCA-negative ovarian cancer after partial or complete
response following the second round of chemotherapy. Dr. Manzoor Raza
Mirza MD is the principal investigator for the trial which is sponsored by
NSGO-CTU.
The trial is designed to evaluate UV1 in combination with AstraZeneca’s durvalumab, a PD-L1 checkpoint
inhibitor, and olaparib, a PARP inhibitor which is approved for the patient population in this trial. The trial
will be conducted at more than 40 hospitals in more than 10 European countries. Ultimovacs will provide
the UV1 vaccine and AstraZeneca will provide durvalumab and olaparib for the study.
The study includes three arms treating a total of 184 patients. The first arm will enroll 46 patients receiving
the PARP inhibitor olaparib. The 46 patients enrolled in the second arm will receive olaparib and the
checkpoint inhibitor durvalumab. The third arm will include 92 patients that will receive Ultimovacs’ UV1
vaccine in combination with both AstraZeneca drugs.
The primary endpoint is progression-free survival (PFS) in the treatment arm with PARP inhibitor olaparib
monotherapy, versus PFS in the triple combination treatment arm. Secondary endpoints will include overall
survival (OS), objective response rate (ORR), duration of response (DOR) and safety. Enrollment began in
December 2021, and a total of 10 out of 184 patients have been enrolled in DOVACC as per 31 December
2022, and 17 patients as of the Q4 2022 reporting date.
Topline data on the primary endpoint are expected in H2 2024.
The Partners
The Nordic Society of Gynaecological Oncology – Clinical Trial Unit (NSGO-CTU) is a non-profit organization
aiming to improve the practice of prevention, diagnosis, and treatment for gynaecological cancers by
supporting research and conducting clinical trials across countries.
ENGOT is an umbrella organization for trial groups such as NSGO and acts as a platform to guarantee that
patients in all European countries can participate and benefit from clinical research and progress.
Ovarian cancer
Ovarian cancer is the eighth most common cause of death from cancer in women worldwide. In 2020, there
were over 310,000 new cases diagnosed and over 200,000 deaths (Source: Globoscan). Most women are
diagnosed with advanced (Stage III or IV) ovarian cancer and have a five-year survival rate of approximately
30%. For newly diagnosed advanced ovarian cancer, the primary aim of treatment is to delay the disease
progression for as long as possible and maintain the patient’s quality of life, with the intent of achieving
complete remission or cure.
The combination drugs
Olaparib is a first-in-class PARP inhibitor and the first targeted treatment to block DNA damage response
in cells/tumors harboring a deficiency in homologous recombination repair, such as mutations in BRCA1
and/or BRCA2. Inhibition of PARP with olaparib leads to the trapping of PARP bound to DNA single-strand
breaks, stalling of replication forks, their collapse and the generation of DNA double-strand breaks and
cancer cell death.
Durvalumab is a human monoclonal antibody that binds to PD-L1 and blocks the interaction of PD-L1 with
PD-1 and CD80, countering the tumor’s immune-evading tactics and releasing the inhibition of immune
responses. Durvalumab is approved for unresectable, stage III NSCLC in more than 50 countries including
the US, Japan, and across the EU, based on the Phase III PACIFIC trial.
Chapters
3
4
5
1
2
18 ULTIMOVACS2022
LUNGVAC
The trial
The LUNGVAC trial is a Phase II multi-center, randomized, open-label
trial assessing the safety and efficacy of UV1 in combination with
cemiplimab versus cemiplimab alone in NSCLC patients with advanced
or metastatic disease.
The trial will enroll previously untreated patients with adenocarcinoma
or squamous NSCLC, where tumor biopsies show a PD-L1-expression
score above 50%. These subgroups represent approximately 30% of all
advanced and metastatic NSCLC patients.
Professor Odd Terje Brustugun is the principal investigator for the trial which is sponsored by Drammen
Hospital in the Vestre Viken Hospital Trust, Norway. The trial will enroll 138 patients and will be conducted
at approximately 10 clinical centers in Norway. The trial will evaluate the addition of UV1 to standard of care
treatment with the PD-1 checkpoint inhibitor cemiplimab as compared to cemiplimab monotherapy. Half
of the patients in the trial will be treated with UV1 + cemiplimab and the other half will be treated with
cemiplimab monotherapy.
The first patient in the LUNGVAC trial was enrolled in October 2022. In December 2022, the Norwegian
health authorities changed the reimbursement in the indication from pembrolizumab to cemiplimab.
Following this decision, the LUNGVAC study changed the PD-1 inhibitor in the study from pembrolizumab
to cemiplimab. 2 out of 138 patients have been enrolled in the study after the change to cemiplimab 1
January 2023. The 3 patients enrolled prior to 1 January 2023, will continue treatment with pembrolizumab.
The primary endpoint of the trial is progression-free survival. Secondary endpoints include overall survival
(OS), objective response rate (ORR), duration of response (DOR) and safety. Topline readout is expected in
H2 2025.
The combination drug
Cemiplimab is a PD-1 checkpoint inhibitor that targets the programmed cell death 1 (PD-1) receptor. In 2018,
the Food and Drug Administration (FDA) approved the drug cemiplimab (LIBTAYO®) for patients with an
advanced form of cutaneous squamous cell carcinoma (SCC), a common type of skin cancer.
Non-small cell lung cancer
Lung cancer is currently one of the most common cancers globally and by far the largest cause of cancer
deaths in both men and women. NSCLC accounts for approximately 85% of all lung cancers. An estimated
850,000 new patients (in the US, EU5, Japan, China) are diagnosed with NSCLC each year (Source: Globaldata).
Most of these patients are metastatic, for which the 5-year survival rate is around 7%.
Chapters
3
4
5
1
2
19 ULTIMOVACS2022
Phase I trials overview
Treatment in three Phase I studies have been completed and patients are currently followed up for survival,
immune response and new anti-cancer treatment. The completed trials show clinical outcomes that
Ultimovacs sees as a strong basis for the further clinical development of UV1, both with respect to safety
and signals of clinical effect.
One phase I study (UV1-103) based in the US in malignant melanoma is fully recruited and currently ongoing.
Additionally, the Company is expanding its pipeline using its novel TET-platform, which is a vaccine
technology that can generate multiple vaccine candidates designed to achieve increased T cell responses
to a broad range of target antigens. Patient enrollment started in the Phase I TENDU trial in February of
2021, the first trial evaluating the Company’s TET-technology platform.
Chapters
3
4
5
1
2
20 ULTIMOVACS2022
UV1-103 Phase I trial in Malignant Melanoma
This US-based Phase I clinical trial is evaluating UV1 in combination with
the PD-1 checkpoint inhibitor pembrolizumab as a first-line treatment
in patients with metastatic malignant melanoma. The first cohort of
20 patients was enrolled by September 2019. The second cohort of 10
additional patients was enrolled by August 2020. In addition to UV1, the
first cohort received 37.5 mcg (microgram) of the adjuvant GM-CSF and
the second cohort received the standard 75 mcg dose.
UV1 has demonstrated a good safety profile and no unexpected safety
issues related to UV1 have been observed in this trial. At the end of the
study, the clinical results for the 30 patients in cohort 1 and cohort 2, combined, are:
• Objective response rate (ORR): 57%
• Complete response rate (CR): 33%
Overall Survival (OS):
• Median Progression Free Survival (mPFS): 18.9 months (as measured by iRECIST)
• Overall survival rate after 12 months: 87%
• Overall survival rate after 24 months: 73%
• Overall survival rate after 36 months (cohort one): 71%
After the study ended, at two years follow up, the protocol was amended to follow patients for overall
survival for up to five years. Three patients in cohort 1 did not consent to further follow up, changing the
number of participating patients in cohort 1 from 20 to 17, after two years. At the three years follow-up date
for patients in the first cohort, the three-year overall survival rate was a positive 71% (12 out of 17 patients).
The UV1-103 trial – biomarker analyses
The analyses of five different biomarkers in the UV1-103 trial signal efficacy in patients treated with UV1
in combination with pembrolizumab. These results are supportive of the addition of UV1 to checkpoint
inhibitors, with the potential for improving both efficacy in current target patient populations and extending
the use of immunotherapy to broader patient populations in multiple cancer types, underserved by existing
therapies. The potential value of expanding the number of patients that can benefit from UV1 can be
substantial.
Clinical analyses from the UV1-103 study indicate efficacy of the UV1-pembrolizumab combination in
patients with low levels of PD-L1 (<1%). Low PD-L1 levels are a key predictive biomarker associated with
lower efficacy for pembrolizumab and other anti-PD-1 therapies in some tumor types. The analyses showed
robust responses in patients treated with the combination of UV1 and pembrolizumab, regardless of
patients’ PD-L1 status.
ORR = Objective Response Rate, iCR = Complete Response Rate according to iRECIST, iPR = Partial Response Rate according to iRECIST
In addition to the sub-analysis of the PD-L1 status, the study also evaluated four other key biomarkers that,
in other historical studies, have indicated how responsive patients may be to pembrolizumab monotherapy:
baseline tumor mutational burden (TMB), predicted neoantigens, interferon gamma (IFN-gamma) gene
signature, and levels of tumor infiltrating lymphocytes (TILs). In the UV1-103 study, objective responses
were observed in patients with low TMB, in patients with low neoantigen tumors, and in patients with
tumors which were not enriched for IFN-gamma. These patients have tumors which previous clinical data
have shown would be less responsive to treatment with pembrolizumab monotherapy in various cancer
types. Lastly, the study also showed that clinical responders did not have higher levels of TILs prior to
treatment.
Chapters
3
4
5
1
2
21 ULTIMOVACS2022
Completed UV1 trials in follow-up
Treatment in three Phase I studies with a total of 52 patients enrolled in the period 2013 – 2015 has
been completed at the Oslo University Hospital. The patients have been followed-up for survival, immune
response and new anti-cancer treatment.
• Metastatic prostate cancer (22 patients): Patients with advanced prostate cancer without lung
and/ or liver metastases were enrolled. These patients had started CAB treatment (GnRH-agonist
combined with anti-androgen therapy) prior to UV1 treatment.
• Non-small cell lung cancer (NSCLC, 18 patients): In this lung cancer study, stage IIIb/IV NSCLC
patients were enrolled, who had previously been treated with palliative radiotherapy and/or at least
two courses of chemotherapy. These patients were not to be in progression, confirmed by CT, at
least 4 weeks prior to UV1 treatment.
• Metastatic Malignant Melanoma – UV1 in combination with the CTLA-4 checkpoint
inhibitor ipilimumab (12 patients): The malignant melanoma trial included patients with
unresectable or metastatic disease when enrolled and were eligible for ipilimumab. Ipilimumab
is an agent stimulating immune cell generation and is an approved drug for the treatment of
malignant melanoma.
Safety and tolerability were primary endpoints in all three studies, while immune response towards any
of the UV1 peptides and efficacy were secondary endpoints. Three different dose levels of UV1 were
investigated in the prostate cancer and NSCLC studies (100, 300 and 700 µg). In the malignant melanoma
study, 300 µg UV1 was given in combination with ipilimumab. UV1 doses have been given with GM-CSF as
an adjuvant treatment.
Data from the three studies showed that UV1 is generally well tolerated. There were no dose limiting
toxicities. UV1 induced an immune response by telomerase (hTERT) specific T-cells in 82% of patients
across the three studies (range 67-91%).
When combining UV1 with ipilimumab, a CTLA-4 checkpoint inhibitor, 91% of malignant melanoma patients
developed an immune response. The responses appeared earlier, required fewer vaccinations and were
stronger and more long lasting compared to vaccination with UV1 alone. These data are compatible with a
mechanism of action where blocking CTLA-4 checkpoints induce additional expansion of UV1-specific CD4
T cells induced by UV1 vaccination. In this study, median overall survival (OS) read out at 66.3 months and
a median progression-free survival (PFS) read out at 6.7 months.
The three completed Phase I trials have been reviewed by the FDA (U.S. Food and Drug Administration) and
founded the basis for starting clinical research in the US in malignant melanoma. The outcome of these
trials established a strong foundation for the further development of UV1.
The detailed results from these Phase I studies have been presented in published articles available at the
company website under ‘Presentations and Publications / Publications’:
• Phase I/IIa clinical trial of a novel hTERT peptide vaccine in men with metastatic hormone-naive prostate
cancer (08.04.2017) - Cancer Immunology Immunotherapy
• Long-Term Outcomes of a Phase I Study With UV1, a Second Generation Telomerase Based Vaccine, in
Patients With Advanced Non-Small Cell Lung Cancer (26.11.2020) - Frontiers in Immunology
• Combining a Universal Telomerase Based Cancer Vaccine With Ipilimumab in Patients With Metastatic
Melanoma Five-Year Follow Up of a Phase I/IIa Trial (11.05.2021) - Frontiers in Immunology
Chapters
3
4
5
1
2
22 ULTIMOVACS2022
The TET-platform and the TENDU Phase I trial
The TET-Platform
Ultimovacs is developing a vaccine adjuvant technology platform, TET (Tetanus-Epitope Targeting). The
patent protected TET-platform combines antigens and a vaccine adjuvant in the same molecule. This
allows a beneficial safety profile and easy administration, offering a promising approach to induce T cell
responses against cancer-specific peptides. The platform can generate multiple first-in-class cancer
vaccine candidates that harness pre-existing antibody responses against tetanus induced by standard
tetanus vaccination. TET vaccine candidates can be tailored to many types of cancer and potentially to
infectious diseases.
Pending confirmation of the safety of the TET technology and results from ongoing and further preclinical
development of the TET platform, the ambition is to identify new cancer vaccine candidates to move into
clinical development. Ultimovacs is currently performing preclinical studies for further development of the
TET technology.
Furthermore, Ultimovacs is in the process of developing an improved manufacturing process based on
the new core molecule which will enable new vaccine candidates to move into clinical development. The
TENDU project provides an opportunity to do early testing of the safety and immune activation of the TET
technology while Ultimovacs continues to optimize the core TET molecule and production process. The
outcome of all these activities is expected to support the decision of which drug candidates to move into
clinical development in the future.
The TENDU trial
The TENDU trial is the first Phase I trial exploring the TET technology. In TENDU, the TET technology
incorporates prostate-cancer-specific antigens and the trial will provide valuable safety and immune
activation data that will support the further development of new vaccine solutions based on the TET
technology.
The TENDU trial is being conducted at Oslo University Hospital. The first patient was treated in February
2021, and the last patient was enrolled in December 2022. A total of 12 patients have been enrolled. Three
different doses of TENDU have been investigated: 40 mcg (3 patients), 400 mcg (3 patients) and 6 patients
received the highest dose (960 mcg). All patients are followed-up for 6 months after their last treatment.
So far, the TENDU treatment has been shown to be safe and well tolerated. Readout is expected during
H2 2023.
Chapters
3
4
5
1
2
23 ULTIMOVACS2022
Operational overview
Manufacturing
Ultimovacs is progressing further development of chemical manufacturing and control (CMC) of the UV1
product candidate in preparation for Phase III clinical trials. The UV1 active pharmaceutical ingredients
(API) are manufactured by PolyPeptide Group. Corden Pharma is the manufacturer of the UV1 fill and
finish Drug Product.
Regulatory designations
Fast Track Designation
On October 21, 2021, Ultimovacs announced that its universal cancer vaccine, UV1, in combination with
checkpoint inhibitors, received Fast Track designation from the U.S. FDA in the treatment of unresectable
or metastatic melanoma – either as add-on therapy to pembrolizumab or as add-on therapy to ipilimumab.
Ultimovacs is currently evaluating UV1 as add-on therapy to ipilimumab and nivolumab as first-line
treatment for unresectable or metastatic melanoma in the INITIUM trial.
The FDA Fast Track process is designed to facilitate the development and expedite the review of drugs
that meet urgent needs in serious medical conditions. Fast Track designation enables early and frequent
communication with the FDA to support a potential therapy’s development, as well as entitlement to
a Rolling Review of the Biologic License Application. Therapies with Fast Track designation may also be
considered for Accelerated Approval and Priority Review, provided certain criteria are met.
Orphan Drug Designation
On December 2, 2021, Ultimovacs announced that UV1 received Orphan Drug designation from the U.S. FDA
in the treatment of malignant melanoma. UV1, as add-on therapy to checkpoint inhibitors ipilimumab and
nivolumab, is currently being studied as first-line treatment for metastatic melanoma in INITIUM.
The FDA Office of Orphan Products Development (OOPD) supports and advances the development and
evaluation of new treatments for rare diseases that affect fewer than 200,000 people in the U.S. Orphan drug
designation provides certain benefits, including seven-year market exclusivity upon regulatory approval, if
received, exemption from FDA application fees and tax credits for qualified clinical trials.
Chapters
3
4
5
1
2
24 ULTIMOVACS2022
Publications and presentations
• On April 11, 2022, Ultimovacs presented a poster at the annual meeting of the American Association for
Cancer Research (AACR). The data in the poster entitled “Promoting immunogenicity of synthetic long
peptide vaccines based on in vivo IgG complex formation: Preclinical evaluation and clinical entry of the
TET platform”, shows that TET enables the efficient and antigen-specific T cell priming required for an
effective vaccine adjuvant system with no safety concerns.
• On 10 May 2022, Ultimovacs presented a poster at the Cancer Immunotherapy (CIMT) annual meeting in
Mainz, Germany. The poster presentation covers results from long-term follow-up data from the use of
the UV1 vaccine in three Phase I/IIa clinical trials. The results substantiate the clinical relevancy of the
UV1-specific immune response and the rationale for combining the Company’s lead product candidate,
the universal cancer vaccine UV1, with checkpoint inhibitors.
• On 25 May 2022, Ultimovacs announced the publication of long-term follow-up data on UV1 in the Journal
for ImmunoTherapy of Cancer (JITC). The data show that dynamic UV1 specific immune responses
lasting up to 7.5 years are associated with longer survival and that dose responses are enhanced when
UV1 is used in combination with checkpoint inhibitors. The use of UV1 leads to multi-faceted immune
responses with anti-tumor characteristics. Furthermore, the evidence points to the conclusion that the
UV1-specific immune response is embedded in immune memory, implying a potential mechanism for
long-term protection against recurrent cancer.
• On 12 September 2022, Ultimovacs announced the publication of data from the UV1 Phase I malignant
melanoma trial combining UV1 with ipilimumab in the Journal of Translational Medicine. Clinical
responses were observed in patients with favored and less favored baseline characteristics, as well as
T cell activation observed post-treatment in tumors of responding patients
• On 18 October 2022, Ultimovacs announced thatdata from its Phase I UV1-103 melanoma trial were
presented at the 19th International Congress of the Society for Melanoma Research (SMR) in Edinburgh,
UK. Biomarker data support strong clinical responses from UV1 in combination with pembrolizumab,
also in patients considered less likely to respond to monotherapy checkpoint inhibition.
• On 27-30 October 2022, the lead investigator of the DOVACC Phase II clinical trial, Dr. Mansoor Raza
Mirza from Copenhagen University Hospital, presented a trial-in-progress poster, giving an overview of
the DOVACC trial, at the European Society of Gynaecological Oncology (ESGO) 2022 Congress in Berlin,
Germany.
Chapters
3
4
5
1
2
25 ULTIMOVACS2022
Intellectual Property rights
Below is an overview of Ultimovacs published patents and patent applications.
PATENT /
PATENT
APPLICATION
PRIORITY
DATE
STATUS AREA COVERED GEOGRAPHIC AREA
EXPIRY DATE
(UNEXTENDED)
EXPIRY DATE
(EXTENDED)
ASSIGNEE
1
EP10250265.5
16 Feb
2010
Granted/
pending
UV1 composition of matter, the nucleic
acid sequences coding for the vaccine
peptides, as well as use of the vaccine
for the treatment of cancer.
Patent granted in: Eu-
rope, USA, Japan, Rus-
sia, South-Korea, India,
China and Hong Kong,
including divisionals in
USA and Japan.
Divisional applications
have been filed in Eu-
rope, USA, Japan, India,
and China.
2031 Up until 15 Febru-
ary 2036 via a Sup-
plementary Pro-
tection Certificate
(SPC) in Europe
or via Patent Term
Extension (PTE) in
the USA. 1, 2
Ultimovacs
2
EP16172760.7
2 June
2016
Granted/
pending
UV1 in combination with an immune
checkpoint inhibitor of a certain defini-
tion, including combined treatment with
UV1 and anti-CTLA-4 and/or anti-PD(L)-1
antibodies.
Patent granted in USA.
Pending national/re-
gional phase in Europe,
Japan, Australia and
Canada.
Divisional applications
have been filed in USA
and Japan.
2037 Maxiumum term
could be until 2042
via a SPC in Europe
or PTE in USA, but
it could be shorter
depending on vari-
ous factors. 1, 2
Ultimovacs
3 EP10156505
15 March
2010
Granted
Composition of matter and method of
use for an immunogen comprising a
peptide derived from tetanus toxin.
Patent granted in USA,
Europe and Canada.
2031
-
Leiden Univer-
sity Medical
Centre
(Ultimovacs
license)
4
GB1917699.9
4 Decem-
ber 2019
Pending
Composition of matter of TENDU conju-
gates and vaccine compositions and use
thereof for the prevention or treatment
of cancer, T-cell epitopes of the con-
jugates and the encoding nucleic acid
molecules.
Pending national/region-
al phase in USA, Eu-
rope, Japan, China, Hong
Kong, India and Canada.
2040
-
Ultimovacs
5
EP21178648.8
9 June
2021
Pending
1. Composition of matter of a TET
conjugate comprising a B-cell epitope
(such as an MTTE sequence) and certain
CD4+ T-cell epitopes (such as an hTERT
sequence). Also, nucleic acid sequences
encoding the conjugate as well as use
of the conjugate for the treatment or
prophylaxis of cancer.
2. Compositions of matter of certain
hTERT polypeptides and the nucleic acid
sequences encoding these as well as
their use in the treatment or prophylax-
is of cancer.
3. Composition of matter of a core
molecule.
4. A (biomarker) method for detect-
ing a CD4+ T-cell response following
vaccination by measuring specific B-cell
responses.
PCT application filed
2042
-
Ultimovacs
1 Europe: it likely that SPCs based on both patents granted, from EP10250265.5 and EP16172760.7, could be obtained;
2 USA: PTE can generally only be obtained for one patent based on a single marketing authorization
The ownership of the abovementioned patents and patent applications 1 and 2 related to the UV1 platform,
is held by Ultimovacs. Patents and patent applications in group 3, 4 and 5 are related to the TET platform.
Patents in group 3 are licensed from the Leiden University Medical Centre. Patent applications in group 4
and 5 are held by Ultimovacs. Ultimovacs is continuously working to obtain and maintain patent protection
for the Company’s technologies and platforms. This will, in due time, include seeking to obtain patent term
extensions such as Supplementary Protection Certificates (SPCs) in Europe and Patent Term Extension
(PTE) in the US. SPCs and PTE can be applied for after the granting of market authorization in the respective
territories. In Europe, patent term extensions via an SPC are up to 5 additional years, provided that this
does not result in a total remaining patent plus SPC term of more than 15 years from the grant of marketing
approval (+ 0.5 years via pediatric extension (PED)) In the US, extensions via PTE are up to 5 years, provided
that the extension does not result in a total remaining patent term of more than 14 years from FDA approval
(+ 0.5 years via PED).
Chapters
3
4
5
1
2
26 ULTIMOVACS2022
Intellectual Property rights - continued
There are also other mechanisms for protection of pharmaceutical products in addition to patents.
Regulatory data exclusivity blocks subsequent pharmaceutical developers from referencing (comparing
to) an innovative therapeutic’s data in order to take a shortcut to get marketing authorization. European
regulations provide eight years of data exclusivity for innovative therapeutics, starting from the first
marketing authorization date. Data exclusivity is followed by a two-year market exclusivity period, which
can be extended by a further year if the product shows significant clinical benefit in a new therapeutic
indication. Competitors will not be able to launch generic or biosimilar products until the expiry of the data
and marketing exclusivity periods. In the US the market exclusivity term for innovative biologics is 12 years
from the date the reference product was first licensed, with an additional 6 months of exclusivity for use in
pediatric populations. For qualifying indications with small patient populations, Orphan Drug status may be
granted to a pharmaceutical product giving market exclusivity for 10 years (+ 2 years via PED) in Europe and
7 years (+ 0.5 years via PED) in the US. In Europe, products granted Orphan Drug status are not anymore
entitled to the + 0.5 years extension via PED to SPC protection.
Chapters
3
4
5
1
2
27 ULTIMOVACS2022
The cancer treatment landscape
Introduction
There are a range of cancer therapies including surgery, chemotherapy and radiation, all of which have been
used for many years and remain among the most common treatments. The history of chemotherapy began
in the early 20th century, but its use in treating cancer began in the 1930s. Surgery and radiation were
the basis for solid tumor treatment into the 1960s. Now, immunotherapy is becoming a new tool in cancer
treatment, being used far more widely in the 21st century. Immunotherapy is the field of immunology that
uses a person’s own immune system to fight cancer, aiming to identify treatments through “activating
immunotherapies” or “suppressive immunotherapies.” Effective immunotherapies for cancer, where the
aim is to activate tumor-specific immune responses, are addressed hereafter.
Over the last decade, the development of immunotherapeutic medicines addressing cancer indications
has been impressive. Immunotherapeutic programs include a broad range of agents, such as antibodies,
(synthetic) peptides, proteins, small molecules, oncolytic viruses, bi-specific antibodies and cell therapies.
After the approval of ipilimumab (CTLA-4) in 2011, various trends
1
, such as changes in the standard of care
treatment options (driven by survival data), the development of immune biomarkers (e.g. PD-L1 expression),
and the rise in developing drug combinations, have driven further achievements in immuno-oncology
(IO) treatment options. The treatment of melanoma has been at the forefront in the development of IO
therapies. High-dose interleukin-2 (IL-2) therapy approvals (Proleukin®, aldesleukin) in the late 1990s
2
showed that melanomas are susceptible to immunotherapies and created the basis for the development
of ipilimumab, nivolumab, and pembrolizumab in this indication. Presently, approximately 69 immuno-
oncology products are marketed in multiple indications
3
in the major global pharmaceutical markets
4
.
Of those products, checkpoint inhibitors are valued the most, in terms of generated sales, driven by
ipilimumab (YERVOY®), nivolumab (OPDIVO®), and pembrolizumab (KEYTRUDA®) due to their multiple
approvals
5
in various cancer types.
Strong growth expected in the years to come
Figure 1: Top-selling Checkpoint Inhibitor programs (source: Deutsche Bank, July 2022). Opdivo® (nivolumab), Keytruda® (pembrolizumab), Tecentriq® (atezolizumab),
Imfinzi ® (durvalumab), Bavencio® (avelumab), Libtayo® (cemiplimab)
Revenues generated from the major PD-(L)1 programs marketed globally were approximately $30 billion in
2021 and are forecast to exceed $60 billion in 2028 (Figure 1), with pembrolizumab remaining the market
leader. Sales are expected to be driven primarily by increased use in indications where products are
already approved, as well as by expansion into other tumor types (gastric cancer, pancreatic cancer and
other hematology malignancies), and by the use of CPIs in earlier cancer stages (neo/adjuvant treatment,
primarily driven by melanoma and NSCLC). CPI treatments are expected to serve as backbone therapy to
various (doublet/triplet) combination treatments.
1 Development of immuno-oncology drugs — from CTLA4 to PD1 to the next generations, Axel Hoos, Nature Reviews, April 2016
2 Proleukin Wins ODAC Support For Use in Metastatic Melanoma (cancernetwork.com)
3 Global Data, Thematic Research: Immuno Oncology, 2022
4 Major markets include the US, EU4 (Germany, Italy, Spain, France), UK and Japan
5 Ipilimumab: 7 approvals, pembrolizumab: 18 approvals, nivolumab: 12 approvals
Chapters
3
4
5
1
2
28 ULTIMOVACS2022
Over 55% of global sales of CPIs are in the US, which is expected to continue to dominate through to
2028. Sales in Europe and Japan are also expected to grow strongly, approximately doubling over the
period, with the highest rate expected in Europe (Figure 2 ).
Figure 2: Total geographic share of Checkpoint Inhibitor program sales in 2021 and 2028 (Oncology debrief: longitudinal survey and IO market model updates, Deutsche
Bank, 2022)
In China, an increased activity in the development of CPIs has occurred over the last 5 years, as
shown below (Figure 3). Cancer patients have been conventionally treated with surgery, radiotherapy,
chemotherapy, or by targeted drug therapies. Emerging treatment options such as immunotherapies
have not been widely accessible due to the initial lack of innovation and although western drugs were
imported, these treatment options came with high prices and were not available to most cancer patients.
However, in the last 5 years, a significant number of China-developed CPIs have been approved (Figure 3),
making these valuable treatment options accessible to Chinese patients.
Figure 3: CPI approval in US/Europe versus China (source: Global Data, 2022, Ultimovacs). Note: Cadonilimab is a novel, first in class PD 1/CTLA 4 bi specific immuno
therapy and the first dual targeted bispecific checkpoint modulator to be approved globally
Cancer Vaccines
Without a doubt, CPIs have positively impacted the cancer treatment landscape over the last decade.
Treatments have been particularly successful in tumors such as lung cancer and melanoma, which
are defined as immunogenic and therefore CPI-sensitive. However, many patients do not respond, as
indicated below (Figure 4), and will therefore need further treatment alternatives.
Figure 4: Overall response rates in various cancer types (source: Compugen, Corporate Overview 2021 (Adapted from FDA label)
Chapters
3
4
5
1
2
29 ULTIMOVACS2022
Next-generation immunotherapy modalities include antibodies, vaccines, small molecules and cell
therapies. All these therapies apply different mechanisms of action to stimulate anticancer activity by
targeting various parts of the immune system.
“The future of cancer immunotherapy lies in the combination of selective cancer vaccines and checkpoint inhibitors
or some other means of relieving immune suppression associated with the tumor.
6
”
Indications of relatively high relevance
for cancer vaccine therapies that
induce T cell responses against
tumor cells include NSCLC, cervical
cancer, HNSCC, glioblastoma, HPV-
associated cancers, and melanoma.
The majority (144) of the 268 active
vaccine cancer programs are in Phase
II clinical trials (Phase III: 21 programs;
Phase I: 103 programs).
7
When looking
at treatment modality type, subunit
vaccines, such as protein or peptides,
selected to induce an effective
immune response, account for 50%
of all active development programs.
Earlier randomized clinical trials from
single-agent vaccine programs did
not demonstrate an apparent clinical
benefit.
A likely reason is the lack of addressing the role of immunosuppression in cancer, such as the immune
checkpoints. Upon the arrival of CPIs, this restricting mechanism is now efficiently addressed, and
therefore CPI/vaccine combinations treatments seem complementary to each other. The overall
good safety profile of (peptide) vaccines makes them excellent candidates for use in a combination
setting where they offer the potential to promote longer-term responses and reduce the risk of tumor
recurrence, without causing toxicity on top of the initial CPI treatment.
Furthermore, recent industry clinical progress in melanoma has boosted confidence in the potential for
CPI/vaccine combinations.
Development of next generation checkpoint inhibitor therapies
Present and next generation CPI therapies are expected to continue to have the largest market share of
IO therapies in the years to come. New targets in CPI immunotherapy, such as LAG3 (relatlimab), were
introduced to the market (in combination with nivolumab as Opdualag®) in early 2022. Other targets, such
as TIGIT (e.g. domvanalimab, tiragolumab, ociperlimab, vibostolimab) and TIM3 (e.g. cobolimab), are in late-
stage clinical development, both primarily in lung cancer. AstraZeneca’s CTLA-4 inhibitor tremelimumab
(the second CTLA-4 program after the approval of ipilimumab in 2011) was approved in the US in the
second half of 2022 in combination with durvalumab in liver cancer and NSCLC.
The overall trend in oncology treatment is toward the use of CPIs in combination with other drug modalities
will challenge the present (monotherapy) standards of care. We believe vaccine treatment combinations,
among other immunotherapy alternatives, applied in combination therapies have the potential to support
the impact of CPIs in a wider patient population by improving durable treatment responses and overcoming
treatment resistance.
Also, the increase of CPI program approvals in the adjuvant/neoadjuvant setting triggers the extended use
of CPI treatment in earlier-stage cancer patients. Several PD-L1 programs are approved in an adjuvant/
neoadjuvant setting in melanoma, renal cell cancer, bladder cancer, breast cancer, and NSCLC. (Figure 5)
6 The Future of Immunotherapy: A 20-Year Perspective, David C. Wraith - 2017 Nov 28. doi: 10.3389/fimmu.2017.01668
7 Active vaccine programs derived from Global Data, 2022
Chapters
3
4
5
1
2
30 ULTIMOVACS2022
Although the development of CPI therapies has increased significantly over the last 4 years to potentially
provide less expensive immune therapy treatments to patients, such program approvals have not yet
been obtained. In the years to come it is expected that biosimilars, as well as other “low price” focused
program developers, may come to the market where they would be able to compete with the established
CPI programs. Therefore, overall access to CPIs (and further combination treatment options) is expected
to increase and will therefore benefit more patients in the need for combination cancer treatment option,
including programs such as UV1.
Figure 5: Checkpoint Inhibitor approved programs (source: Mizuho Securities, November 2022)
Chapters
3
4
5
1
2
31 ULTIMOVACS2022
Financial overview
Ultimovacs does not yet generate revenues, as the Company is in a research and development phase. In
FY22, the Company recognized government grants of MNOK 9.5 compared to MNOK 14.6 in FY21, which have
been deducted from payroll expenses and other operating expenses in the statement of profit and loss.
The cash payments from the grants are partly received in the calendar year following the accounting year.
The decrease in public grants is primarily due to slower progress in the DOVACC trial, and no part of the
grant from Innovation Norway to support this trial was received in FY22.
Total personnel expenses in FY22 were MNOK 71.5 compared to MNOK 61.9 in FY21. The FY22 increase
was primarily due to two more FTEs employed in the company during FY22 compared to FY21, explaining
MNOK 4.2 of the difference. Further, MNOK 2.3 of the increase is due to higher expenses related to the
share-based compensation option program, as well as an increase in social security costs as options were
exercised during the year.
Other operating expenses primarily comprise research and development related expenses. These expenses,
including IP and external R&D expenses, offset by government grants, amounted to MNOK 91.0 in FY22 and
MNOK 88.2 in FY21. The primary projects contributing to these expenses in FY22 were the phase II trials
INITIUM, NIPU, FOCUS and LUNGVAC, CMC development (i.e. Chemistry, Manufacturing, and Controls) and
development of the TET platform. Total other operating expenses in FY22 was MNOK 109.5 compared to
MNOK 99.2 in FY21, where the total increase primarily is derived from the increase in R&D costs.
Net financial income in FY22 of MNOK 15.8 is comprised of MNOK 8.9 in interest from bank, MNOK 2.1
in currency gain from cash in EUR bank account and MNOK 5.1 in currency gain from the EUR currency
future contracts. As R&D costs are paid primarily in EUR, the Company in 2021 converted MNOK 50 to
EUR and entered into currency swap agreements of MNOK 150 as part of a currency hedging arrangement,
contributing to the agio (foreign exchange) gains in FY22 as EUR has strengthened relative to NOK during
the year.
Total loss in FY22 amounted to MNOK 167.8 compared to a loss of MNOK 164.7 in FY21.
Financial results
KEY FINANCIALS (1 000) 2022 2021
Total revenues - -
Total operating expenses 183 631 163 832
Operating profit (loss) (183 631) (163 832)
Profit (loss) for the period (167 792) (164 722)
Basic and diluted earnings (loss) per share (NOK per share) (4.9) (5.1)
Net change in cash and cash equivalents (155 426) 137 106
Cash and cash equivalents, end of period 425 309 574 168
Chapters
3
4
5
1
2
32 ULTIMOVACS2022
Financial position
Total assets per 31 December 2022 were MNOK 509.7, a decrease of MNOK 145.9 from 31 December 2021,
primarily as a consequence of negative operational cashflow. The Company has entered into EUR swap
contracts to mitigate the foreign exchange risk related to expected future costs in ongoing projects. By the
end of the quarter, the EUR swaps amounted to MEUR 15.0, and MNOK 1.1 in ‘Receivables and prepayments’
are related to the fair value of these EUR swap contracts by the end of the year.
The book value of Goodwill and Licenses related to the value of the subsidiary Ultimovacs AB in Sweden,
has since 31 December 2021 decreased by MNOK 1.9 due to the strengthening of NOK against SEK.
Total liabilities as of 31 December 2022 amounted to MNOK 60.3, of which MNOK 14.4 are non-current.
Total equity equaled MNOK 449.4 as of 31 December 2022. Share capital increases in September 2022
(44,000 shares) and November 2022 (130,700 shares), related to the exercise of a total of 174,700 options
granted under Ultimovacs’ share option program, resulted in gross proceeds of MNOK 5.5. Subsequently,
the Company’s share capital increased in 2022 by NOK 17,470 by issuing 174,700 new shares, each share
of par value NOK 0.10. Consequently, the total number of shares as per 31 December 2022 was 34,396,461.
Further, total equity has, since year-end 2021, been decreased by the period’s operating loss and currency
translation, in total amounting to MNOK 169.7, and has in addition been increased by the recognition of
share-based payments/stock options of MNOK 20.4.
Cash flow
The total net decrease in cash and cash equivalents in FY22, not including currency effects, was MNOK
155.4, which is primarily related to net negative cash-flow from operations amounting to MNOK 167.7,
offset by interest income of MNOK 8.9 and two share issues related to share option exercises, raising net
proceeds of MNOK 5.5.
Total cash and cash equivalents per 31 December 2022 amount to MNOK 425.3.
Allocation of the Parent Company’s net result
The Board of Directors proposed that the loss of MNOK 161.1 in Ultimovacs ASA is transferred to accumulated
losses.
Chapters
3
4
5
1
2
33 ULTIMOVACS2022
Working environment
Ultimovacs aims to provide a safe, secure and positive work environment for all employees, free of
discrimination or harassment. Ultimovacs does not accept any kind of discrimination against employees,
shareholders, board members and suppliers on the basis of ethnicity, nationality, age, gender or religion.
Salary and terms of employment for comparable positions, as well as recruitment, promotion and
development of the employees, are the same for women and men.
Absence due to sickness was 1.1% in 2022, up from 0.1% in 2021. No work-related accidents were recorded
in Ultimovacs in 2022.
As per 31 December 2022, the Group had 25 employees, 20 in Ultimovacs ASA in Oslo, and 5 in Ultimovacs
AB in Uppsala, Sweden. Of the 25 employees, three were part time employees with 20-50% positions. 12
out of the 25 employees were male and 13 were female. The management team is comprised of six men
and four women and the Board of Directors is comprised of five men and three women.
A total of 23.2 full time employee equivalents were employed during the financial year of 2022.
External Environment
Corporate Governance
Ultimovacs’ operations do not directly pollute or harm the environment, and the Company and its employees
are committed to behaving responsibly and to minimizing the impact on the environment.
The Board and management of Ultimovacs are committed to maintaining high ethical standards and
promoting good corporate governance. Ultimovacs believes that strong corporate governance builds
and maintains confidence among investors and other stakeholders, and thereby supports maximal value
creation over time. The Board believes that attention to corporate governance is beneficial for companies
and investors. Ultimovacs’ corporate governance principles are based on maintaining a transparent and
clear communication, regulating the division of roles between shareholders, the Board and Executive
Management and treating all shareholders equally. In addition, shares in the Company are freely transferable
and all shareholders are to be treated equally.
Ultimovacs’ Corporate Governance Policy (approved by the Board of Directors on 24 March 2022) and the
Report in this annual statement are based on the Norwegian Code of Practice for Corporate Governance,
issued by the Norwegian Corporate Governance Board (NUES), last revised on 14 October 2021, and the
corporate governance reporting requirements under section 3-3b of the Norwegian Accounting Act.
Corporate Governance is further addressed in a separate statement in this Annual Report and constitutes
an integral part of the Directors’ Report. The full Corporate Governance Policy is available on the company’s
website at www.ultimovacs.com/investors/governance
Chapters
3
4
5
1
2
34 ULTIMOVACS2022
Corporate Social Responsibility (CSR)
Ultimovacs is committed to develop, manufacture and deliver innovative cancer vaccines to address unmet
medical needs and advance cancer care. In its pursuit to reach this goal, Ultimovacs will work to ensure
a socially responsible business operation involving good business ethics, as well as how employees are
treated, the relationship with the environment and the work to deliver safe products to patients, among
others.
Ultimovacs recognizes that we must integrate our business values and operations in a way so that we act
responsibly in a broader social context and meet key expectations of our stakeholders. These stakeholders
include employees, patients, regulators, suppliers, shareholders, the community and the environment.
Ultimovacs will work to ensure a socially responsible business operation involving good business ethics,
as well as how employees are treated, the relationship with the environment and the work to deliver safe
products to patients, among others.
Key CSR focus areas identified, integrated into the Company’s ESG Guidelines (Environmental, Social,
& Governance), are patient safety, employee environment, human rights, environment, supply chain
management, anti-corruption and transparent communication. In addition, separate ethical guidelines
apply to all employees in the group.
Corporate Social Responsibility is further addressed in the ESG Report which also includes the reporting on
the Transparency Act (Norwegian: ‘Åpenhetsloven’), in section #3 in this Annual Report. The ESG guidelines
along with the annual ESG report, are available on the company’s website at www.ultimovacs.com/
investors/ESG
The Board of Directors in Ultimovacs are ultimately responsible for the ESG governance in the Company,
overseeing the ESG topics and the Management’s role in assessing and managing them. All employees
are responsible for adopting and implementing the Company’s guidelines on ESG.
The ESG Guidelines will be regularly reviewed and any amendment shall be approved by the Board of
Directors.
Risks and uncertainties
Ultimovacs is a mid-stage research and development biotech company. Ultimovacs is exposed to the
same generic risks as other companies within this sector. The Company has not generated any revenues
historically and is not expected to do so in the short term. The Group’s development, results of operations
and operational progress have been, and will continue to be, affected by a range of factors, many of which
are beyond the Group’s control.
Operational risks
Research and development up to approved registration is subject to considerable risk and is a capital-
intensive process. The Company’s cancer vaccines candidates and technology platforms are dependent on
research and development and may be delayed and/or incur higher costs than currently expected.
Legislative and regulatory environment
Operations may be impacted negatively by changes or decisions regarding laws and regulations. Several
regulatory factors have influenced and will likely continue to influence the Group’s results of operations.
The Group operates in a heavily regulated market and regulatory changes may affect the Group’s ability
to commence and perform clinical studies, include patients in clinical trials, protect intellectual property
rights and obtain patents, obtain marketing authorization(s), market and sell potential products, operate
within certain geographical areas/markets, produce the relevant products, in-license and out-license
products and technology, etc.
Chapters
3
4
5
1
2
35 ULTIMOVACS2022
Competitive environment
Competitive cancer treatments and new/alternative therapies, either within immune-oncology or within
the broader space of oncology, may affect the Group’s ability to commence and complete clinical
trials, as well as the opportunity to apply for marketing authorization, and may influence future sales if
marketing authorization is obtained. Competing pharmaceuticals can capture market shares or reach the
market faster than Ultimovacs. If competing projects have a better product profile (e.g. better efficacy
and/or less side effects), the future value of Ultimovacs’ product offerings may be lower than expected.
The amount and magnitude of clinical trials within different oncology areas in which the Group operates
may influence the access to patients for clinical trials.
Financial risks
The primary financial risks are foreign exchange risks and financing risks.
Foreign exchange rate exposure
Ultimovacs will conduct a large share of its clinical studies and other R&D activities outside of Norway
and is therefore exposed to fluctuations in the exchange rate between NOK and several currencies, mainly
EUR and USD. Further, production is conducted in Belgium and Italy, and production costs are, therefore,
exposed to the fluctuations of EUR against NOK. The fluctuation of the above-mentioned currencies may
therefore impact the overall costs for the clinical studies and production, as well as other costs such as
consultants invoicing in these currencies.
In addition, the Company has investment in foreign operations, whose net assets are exposed to currency
translation risk.
Operational currency exposure is constantly monitored and assessed. The Group has converted cash to
EUR and entered into EUR swaps to mitigate the foreign exchange risk and to get a better predictability
regarding future costs.
Financing
Adequate sources of funding may not be available when needed or may not be available on favorable terms.
The Company’s ability to obtain such additional capital or financing will depend in part upon prevailing
market conditions as well as conditions of its business and its operating results, and those factors may
affect its efforts to arrange additional financing on satisfactory terms. The Group monitors the liquidity risk
through monthly rolling consolidated forecasts for result and cash flow, and the Board of Directors works
continuously to secure the business operation’s need for financing.
Interest rate risk
The Group has no interest-bearing debt. Bank deposits are exposed to market fluctuations in interest
rates, which impact the financial income.
Ultimovacs’ financial risk exposures are described in more detail in note 17 in this financial statement.
Chapters
3
4
5
1
2
36 ULTIMOVACS2022
Going concern
The annual accounts have been prepared on the basis of a going concern assumption, in accordance
with section 3-3(a) of the Norwegian Accounting Act, and in the opinion of the Board of Directors, these
financial statements provide a fair presentation of the Company’s business, financial results, and outlook.
No significant events have occurred since the end of 2022, and the Board of Directors confirms that the
going concern assumption has been satisfied.
Subsequent events
On 23 January 2023, Ultimovacs announced that patient enrollment was completed in the NIPU Phase II
clinical trial in metastatic pleural mesothelioma.
In February 2023, as part of the Q4 2022 reporting, Ultimovacs provided an update on guidance regarding
expected topline data readouts for its Phase II clinical trials:
• INITIUM (malignant melanoma): H1 2023 (no change from previous statements)
• NIPU (pleural mesothelioma): H1 2023 (no change from previous statements)
• FOCUS (head and neck cancer): H1 2024
• DOVACC (ovarian cancer): H2 2024
• LUNGVAC (non-small cell lung cancer): H2 2025
There are no other significant subsequent events after the balance sheet date.
Chapters
3
4
5
1
2
37 ULTIMOVACS2022
Outlook
Ultimovacs’ lead product candidate, the universal cancer vaccine UV1, triggers an immune response against
telomerase, which is expressed in 85-90% of cancer types and across all stages of tumor growth. UV1 can
be used in combination with different types of cancer treatment and is expected to generate immune
responses across the general population (i.e., regardless of HLA type). The UV1 vaccine can be broadly
applied, has low manufacturing cost, is off-the-shelf and easy to use, with intradermal injections, and can
be administered at all hospitals and community centers. Checkpoint inhibitors have positively impacted
the cancer treatment landscape over the last decade. Many patients, however, do not respond and will
need further treatment, representing an unmet medical need. UV1 can potentially serve as a backbone
therapy to enhance efficacy of different checkpoint inhibitors.
As of now, UV1 is being investigated in five randomized Phase II trials in five different cancer types in
combination with different checkpoint inhibitors. Ultimovacs is sponsoring one of the trials. The other four
trials are initiated and sponsored by academic institutions, and supported by Ultimovacs. The five Phase II
clinical trials will enroll more than 670 patients in total, representing opportunities for Ultimovacs to move
toward a possible registration path. The main study objectives are efficacy and safety on combination
therapies.
The guidance for expected timeline readout from the UV1 Phase II clinical program, which will be updated
with the Q4 2023 reporting, is as follows:
• INITIUM (malignant melanoma): H1 2023
• NIPU (metastatic pleural mesothelioma): H1 2023
• FOCUS (head and neck cancer): H1 2024
• DOVACC (ovarian cancer): H2 2024
• LUNGVAC (non-small cell lung cancer): H2 2025
Ultimovacs continues to pursue strategic collaborations with cancer institutions and pharmaceutical
companies to document the efficacy and safety of UV1 in a range of cancer types and in combination with
different cancer treatments. Ultimovacs makes clinical development choices based on the universal nature
of UV1 as a cancer vaccine. Positive results from ongoing Phase II clinical trials will reinforce the significant
development and market potential of the universal cancer vaccine. The related financial opportunity could
be highly attractive. Based on current funding, plans and expectations, Ultimovacs current cash balance is
expected to support operations to mid-2024.
Ultimovacs is also seeking to broaden its pipeline of drug candidates. The Company’s research activities
are currently focused on the development of new first-in-class cancer vaccine solutions, building on
Ultimovacs’ base technology, the TET-platform, and exploring new opportunities based on biobank material
from the ongoing and planned clinical studies conducted with UV1. Pending final confirmation of the
safety of the TET technology through the Phase I TENDU trial and further preclinical development, the TET
vaccine adjuvant technology can be applied to identify new cancer vaccine program candidates to move
into clinical development.
Board of Directors and CEO of Ultimovacs ASA
Oslo, 23 March 2023
Sign Sign
Sign
Jónas Einarsson Kari Grønås Eva S. Dugstad
Chair of the Board Board member Board member
Sign
Sign
Sign
Henrik Schüssler Ketil Fjerdingen Leiv Askvig
Board member Board member Board member
Sign Sign
Sign
Aitana Peire Haakon Stenrød Carlos de Sousa
Board member Board member CEO
Chapters
3
4
5
1
2
38 ULTIMOVACS2022
Responsibility statement from the Board of
Directors and CEO
We confirm that the financial statements for the period 1 January to 31 December 2022, to the best of our
knowledge, have been prepared in accordance with IFRS, that the accounts give a true and fair view of the
assets, liabilities, financial position and profit or loss, and that the information in the report includes a
fair review of the development, performance and position of the Company and the Group, together with a
description of the principal risks and uncertainties facing the Company and the Group.
Board of Directors and CEO of Ultimovacs ASA
Oslo, 23 March 2023
Sign Sign
Sign
Jónas Einarsson Kari Grønås Eva S. Dugstad
Chair of the Board Board member Board member
Sign
Sign
Sign
Henrik Schüssler Ketil Fjerdingen Leiv Askvig
Board member Board member Board member
Sign Sign
Sign
Aitana Peire Haakon Stenrød Carlos de Sousa
Board member Board member CEO
Chapters
3
4
5
1
2
39 ULTIMOVACS2022
Governance
03
ESG Report
Corporate Governance
Report
The Board of Directors
Chapters
3
2
4
5
1
40 ULTIMOVACS2022
ESG Report
Ultimovacs’ ESG (Environmental, Social and Government) report will be conducted annually, and this report
is applicable for the full year of 2022. The report is prepared by the Ultimovacs team, and reviewed,
discussed, and approved by the Board of Directors on 23 March 2023.
As of January 2023, Ultimovacs received an ESG Risk Score from Sustainalytics of 19.5, rated as low risk
of experiencing material financial impact from ESG factors. Ultimovacs ranked in the top 3% in the global
biotechnology and pharmaceutical industry.
The claims in this report have not been audited by a third party. For further information, contact
ir@ultimovacs.com.
Contents
• About the Company
• Letter from the Chief Executive Officer
• Responsible Governance
• The Patients
• People and Planet
• Social Commitment
• Business Ethics
• Environmental Impact
• Quality Assurance and Risk Assessment
• Transparency Act
• Development Targets
About the Company
Ultimovacs (“the Company”) is a pre-commercial, clinical-stage biotechnology company developing novel
immunotherapies against cancer. The lead product candidate, UV1, is a peptide-based therapeutic cancer
vaccine inducing a specific T cell response against the universal and essential cancer antigen, telomerase.
The technology is based on pre-clinical and clinical research conducted in more than 1,000 patients over
30 years at the Oslo University Hospital. UV1 is currently being assessed in an extensive Phase II clinical
program in five cancer types in combination with different checkpoint inhibitors, enrolling more than 670
patients in 15 countries.
The Company was founded in 2011 and was publicly listed on the Euronext Oslo Stock Exchange in 2019.
Ultimovacs’ headquarter and main laboratory are located at the Oslo Cancer Cluster Innovation Park, next
to The Norwegian Radium Hospital, a division of Oslo University Hospital dedicated to cancer treatment
and cancer research. The Company also has an office and a laboratory in Uppsala, one of the strongest
biotechnology clusters in Sweden.
Chapters
2
3
4
5
1
3
41 ULTIMOVACS2022
Letter from the Chief Executive Officer
For Ultimovacs, ESG means building a sustainable business so that we can
deliver on our mission: to extend and improve the life of patients, by directing
the immune system against the core of cancer. We aim to provide universally
accessible solutions for patients.
It takes hard work over many years to discover, develop and commercialize
new therapies. We appreciate the contribution from our eco-system, including
internal and external stakeholders, locally and internationally, to make the
achievement of our mission possible. Ultimovacs is proud to be a part of a
community committed to the UN’s Sustainable Development Goal 3: Ensure
healthy lives and promote well-being for all at all ages.
As a clinical-stage biotechnology company with 26 people (as of January 1, 2023), our environmental footprint
is small. The industry operates within a regulated framework aiming to support medical innovation while
ensuring that new biotechnology products are safe for the environment and human health. Headquartered
and publicly listed in Norway, Ultimovacs appreciates the incorporation of the Human Rights Act as national
law. Corruption in the country ranks amongst the lowest in the world. Norway is consistently ranked among
the top countries regarding adherence to the rule of law.
Ultimovacs acknowledges our responsibility for the indirect impact and potential for unintentional ripple
effects from our work. Our current clinical program is conducted in Europe, the US, and Australia. Our
R&D and manufacturing partners, suppliers, and collaborators, are located in Europe and the US. We are
conscious of associating with companies sharing our ethical values and professional standards.
Ultimovacs is proud to be recognized as a top ESG performer out of more than 5,000 companies in
Sustainalytics’ rating universe and one of the top 3% companies in the biotechnology and pharmaceutical
industry globally. Despite our small company size, Ultimovacs’ first ESG report reflects our commitment to
transparency as one of our Company’s core values, and our ambition of continuous improvement in taking
a wider responsibility for both planet and people. We plan to continue to deliver on building a sustainable
business and supporting cancer patients with unmet needs.
Carlos de Sousa
Chief Executive Officer
Chapters
2
3
4
5
1
3
42 ULTIMOVACS2022
Responsible Governance
The Governance framework, Corporate Governance Policy and Code of Ethics is described in detail in the
Annual Report.
Corporate Governance
Ultimovacs has a strong commitment to ensure trust in the Company. The Company’s framework for
corporate governance is intended to decrease risk and utilize the Company’s resources in a prudent and
sustainable manner to the benefit of shareholders, employees, and society at large. The Company seeks
to follow the Norwegian Code of Practice for Corporate Governance (“the Corporate Governance Code”
available at www.nues.no) to the extent not considered unreasonable due to the Company size, stage of
development, and common international (EU & US) industry practice.
The General Meeting
The General Meeting (GM) is the supreme governing body at which shareholders can influence how
sustainability is practiced in the Company. One share equals one vote. The Nomination Committee evaluates
and nominates the board members, and the GM elects each member of Board of Directors annually.
The Board of Directors
The Board of Directors has the principal responsibility for the overall management of the Company and
shall supervise Company’s day-to-day management. The Board holds the ultimate responsibility for the
Company’s sustainability approach. The ESG report is reviewed, discussed and approved by the Board.
The Company discloses details on the Board of Directors and the Audit, Remuneration, ESG and Nomination
Committees annually in the annual report and on the Company website (Investors/Governance).
The Patients
Ultimovacs is a pre-commercial, clinical stage biotechnology company, conducting cancer research and
clinical trials to develop novel immunotherapeutic cancer treatments. As a company, we are first and
foremost patient-driven. However, we recognize that our work has an economic, social, and environmental
impact on our surroundings.
Ultimovacs lead product candidate, UV1, is the result of more than 30 years of research at the Norwegian
Radium Hospital, and biological observations in more than 1,000 patients. Our Phase II clinical program is
enrolling 670 patients at more than 100 hospitals in Europe, the US and Australia.
Safety
The safety of patients being enrolled in the clinical trials is the highest priority. Ultimovacs has detailed
protocols including the Standard Operating Procedure for Adverse Event Reporting. The trials are conducted
in compliance with good clinical practice, following the standards of Good Clinical Practice and Clinical
Trials, according to the regulations from FDA (US) and EMA (Europe). The Company seeks advice and
approval from independent ethics committees and regulatory authorities. Collecting, obtaining, storing,
and using human biological samples requires informed consent. Ultimovacs follows applicable bioethical
principles and regulatory requirements and standards, including General Data Protection Regulation (GDPR)
in Europe (2016/679).
An annual review of all aspects of the quality system and safety are conducted with the Management Team.
For the year 2022, there were no quality or safety incidents that led to any market actions or need for
reporting to the health authorities.
Chapters
2
3
4
5
1
3
43 ULTIMOVACS2022
Research & Development
Ultimovacs collaborates with R&D partners following the principles for Good Laboratory Practice. The
Company is not involved in genetic engineering or emerging technology considered high-risk.
Animal testing
In advancing development of medical products, animal research is often essential and required by regulatory
authorities before human testing can take place. Ultimovacs conducts animal testing only when necessary,
and we are committed to humane and ethical treatment of animals. We support the implementation of
the 3 Rs standard for the ethical use of animals in medicine testing: Replace – use alternative methods,
if possible, Reduce – use the minimum number of animals, and Refine – minimize suffering, pain and
distress, and improve the welfare of the animal used.
Most of our animal studies are conducted at external qualified and certified vendors in the UK and Sweden.
The testing is regulated by the European Union legislation on the protection of animals used for scientific
purposes (Directive 2010/63/EU), one of the most stringent ethical and welfare standards worldwide.
Affordability and access
None of Ultimovacs’ product candidates are currently on the market. We recognize that access to medicines
is key to solving many public health issues. The cancer vaccine UV1 is off-the-shelf and easy to use with
intradermal injections that can be administered at hospitals or community centers.
People & Planet
Developing novel cancer therapies requires a dedicated, highly skilled team, capable of focusing on short-
term deliverables as well as the long-term overall objective for patients. Ultimovacs is proud of our history
of attracting and retaining talent with outstanding expertise, track record and grit. During 2022, we had no
turnover of staff in the Company.
We want to be a great place to work for all employees, with space for multiple identities where everyone
feels they belong. We aim to provide a safe, secure, and positive work environment, free of discrimination
or harassment on the grounds of ethnicity, nationality, age, gender identity, sexual orientation, religion,
physical disabilities or cultural background. Ultimovacs has zero-tolerance for behavior and actions that
may harm our common culture.
The Company has a competitive employee benefits package including a premium health plan, employee
insurance and pension plan, sick leave and parental leave covered by the Company and/or the National
Welfare Administration, flexibility to work from home, five weeks of paid vacation per year, and more.
All employees are invited to a bi-weekly team meeting, where employees have the opportunity to ask
questions and voice concerns.
Diversity
The Ultimovacs Team includes a small number of highly specialized experts, supported by external resources.
In 2022, Ultimovacs had 25 employees (now 26 employees) from seven different nationalities, including
13 women and 12 men. The Management Team consists of ten members from four different nationalities,
including four women and six men. The Board of Directors consists of eight members from two different
nationalities, including three women and five men.
As a small team of 26 people, performance and employee development are discussed on an informal, day-
to-day basis. All employees are included in the Company’s long-term incentive program. Ultimovacs does
currently not report on the gender pay gap due to the company size, but the remuneration of the Board and
Management Team is disclosed in the annual Remuneration Report.
Chapters
2
3
4
5
1
3
44 ULTIMOVACS2022
Social Commitment
Ultimovacs fully supports the Ten Principles of the UN Global Compact. We acknowledge our responsibility
not only for our own Company, but also our responsibility as a corporate citizen. Through the Human Rights
Act, Norway has incorporated several human rights treaties as national law. These include the European
Convention on Human Rights, the International Covenant on Civil and Political Rights, and the International
Covenant on Economic, Social and Cultural Rights. Employees’ freedom of association is protected by
national law.
Ultimovacs does not partner or conduct business with any individual or company that participates in
exploitation of children, inhumane treatment, discrimination, human trafficking, any form of modern
slavery, or forced labor.
Whistle blowing
The national Working Environment Act protects the health, environment, and safety of employees by law.
In addition, Ultimovacs’ process for handling whistle blowing incidents is described in the Corporate Social
Responsibilities (CSR) guidelines available on the Company website. Incidents can be reported either to
Ultimovacs’ CFO, the Chair of the Board, or the leader of the Audit Committee, and will be thoroughly
investigated, while protecting the identity of the whistle blower against retaliation. Ultimovacs reported
zero whistle blower incidents in 2022.
Business Ethics
Ultimovacs’ policy and processes are described in detail in the Company Corporate Governance Policy.
Bribery and corruption
Ultimovacs has zero tolerance for bribery and corruption. The Company had no incidents in 2022.
Lobbying and political involvement
The Company is not engaged in lobbying or political involvement. Ultimovacs does not make monetary
contributions to political parties or affiliated organizations.
Transparency
Ultimovacs is committed to transparency towards all our stakeholders, patients, shareholders, the medical
and scientific community, collaboration partners, and general public. Data from our research and clinical
activities are presented through publications and conferences. Enrollment status for the studies in the
clinical program has been announced in the quarterly reports in 2022.
Community support
As a member of Oslo Cancer Cluster and the Life Science Cluster, the Company is an active participant in
strengthening collaboration and knowledge sharing in the industry, academia, and the private and public
sectors. Ultimovacs was developed with support and grants from the Norwegian Cancer Society, Norwegian
Research Council and Innovation Norway.
Environmental Impact
With only 26 people, Ultimovacs’ direct environmental footprint is small, and the greenhouse gases (GHG)
carbon emissions are minimal. Norway has an almost entirely renewables-based electricity system, with
renewable resources accounting for 98% of its generation. Most of the Company’s carbon emissions are
related to employees traveling due to the international nature of the industry. Ultimovacs’ staff seek to
avoid traveling if virtual meetings are a viable alternative.
As a clinical-stage biotech company, our chemistry, manufacturing and control (CMC) activity is currently
limited to a small volume serving our R&D activities and clinical program. Ultimovacs seeks to collaborate
with partners which are conscious about environmental, social and governance impact, demonstrated
through an appropriate Code of Conduct. Material environmental topics may include green chemistry,
circular waste management, environmental protection, and climate change mitigation.
100% of Ultimovacs’ CMC partners hold a Good Manufacturing Practice (GMP) Certificate.
Chapters
2
3
4
5
1
3
45 ULTIMOVACS2022
Quality Assurance and Risk Assessment
Ultimovacs’ lean business model is based on the procurement of services from external industry experts,
including product manufacturing and the conduct of clinical studies with third parties. The Company
applies a comprehensive procurement process and a structured assessment of suppliers critical to our
operations, to ensure that our work is in compliance with applicable laws, regulations, and guidelines.
Ultimovacs’ Quality Management System (QMS) ensures that the Company’s activities are in full compliance
with applicable GxP regulations (Good Laboratory Practice (GLP), Good Manufacturing Practice (GMP), Good
Distribution Practice (GDP), Good Clinical Practice (GCP), Good Pharmacovigilance Practice (GVP)) and other
related requirements. All activities must comply with applicable national laws, regulations, and guidelines.
Standard Operating Procedures (SOPs) give instructions for performing GxP activities at Ultimovacs. The
Company commits to following the standards of the International Conference of Harmonisation (ICH)
and the World Medical Association Declaration of Helsinki on the Ethical Principles for Medical Research
Involving Human Subjects.
The QMS effectiveness is evaluated as a half-yearly review, performed by the QA and the Management
Team. Ultimovacs aims to be always inspection-ready for audits from regulatory authorities. For the year
2022, there were no quality or safety incidents that led to any market actions or need for reporting to the
health authorities.
Supplier assessment
Ultimovacs has identified 58 companies as “critical suppliers”, defined as companies working within GxP
and/or companies processing personal data on behalf of Ultimovacs. The critical suppliers will be screened
for the existence of an ESG policy (or similar), in accordance with The Transparency Act.
The Transparency Act
The annual ESG Reports will include assessment in compliance with the Transparency Act. Ultimovacs has
established or initiated the following actions during 2022:
I. Established accountability in the Board of Directors: ESG Committee
II. Established guidelines and integrated this into our internal processes:
III. System for handling the obligation to provide information established
IV. Supply chain mapping
V. Risk Analysis of the supply chains and other business relationships
Development Targets
1. Map suppliers’ and collaboration business partners’ adherence to ESG principles and ethical standards
(initiated)
2. Assess risk regarding violations of basic human rights and decent working conditions in the various parts
of the business internally, in the supply chains and vis-à-vis other business relationships (initiated)
3. Introduce systems for handling the obligation to provide information according to the Transparency Act
(initiated)
4. Ensure that all ESG-related information is easily accessible for third-party assessment (initiated)
Chapters
2
3
4
5
1
3
46 ULTIMOVACS2022
Corporate Governance Report
The Board of Directors of Ultimovacs ASA (the “Company”) has prepared a corporate governance policy
which was resolved by the Board of Directors on 4 December 2018 and which entered into force from
the date the company applied for listing on the Oslo Stock Exchange, 21 May 2019. A revised version was
approved by the Board of Directors on 24 March 2022. The complete Corporate Governance Policy can be
found on the corporate website: www.ultimovacs.com
The corporate governance policy addresses the framework of guidelines and principles regulating the
interaction between the Company’s shareholders, the Board of Directors (the “Board”), the Chief Executive
Officer (the “CEO”) and the Company’s executive management team.
The Policy is based on the Norwegian Code of Practice for Corporate Governance issued by the Norwegian
Corporate Governance Board (NUES). The Company will, in accordance with applicable legislation and
stock exchange listing rules, provide a report on the Company’s corporate governance in the Board of
Directors’ report or in a document that is referred to in the Board of Directors’ report.
There has been no non-conformance with the recommendations referred to below for the financial
year of 2022, with the exception for the Code of Practice recommendation which stipulates that the
Board of Directors should ensure that the General Meeting is able to elect an independent chairman at
General Meetings. Please refer to section ‘6 - General Meetings’ regarding the deviation from this NUES
recommendation.
1) Implementation and reporting on corporate governance
The Board of Directors ensures that the company implements and operates by sound corporate governance
principles. The objective of the corporate governance is to regulate the division of roles between
shareholders, the Board of Directors, the CEO and the Company’s Executive Management. In this reporting
section, the Board of Directors provides a systematic evaluation of the Company’s corporate governance
practice covering every section of the Code of Practice. Any deviations from full compliance with the Code
of Practice is explained with a description of the solution that has selected.
The Corporate Governance policy is reviewed annually, and an updated version will be available in the
‘Governance’ section of the Company’s website.
2) Business
Ultimovacs is a biotech company developing cancer vaccines, and the company’s mission is:
“To extend and improve the life of patients by directing the immune system against the core of cancer. We
will provide universally accessible solutions.”
Ultimovacs is committed to develop, manufacture and deliver innovative cancer vaccines to address unmet
medical needs and advance cancer care. The Company’s business activity, as set out in Section 4 of the
Articles of Association, is to develop, produce and sell medicines for the treatment of cancer. The business
may be carried out by the Company, the Company’s subsidiaries or by participation in other companies or
in cooperation with others.
Ultimovacs will work to ensure a socially responsible business operation involving good business ethics,
addressing how employees should be treated regarding equality and non-discrimination, respect for human
rights, anti-corruption and bribery, the relationship with the environment and the work to deliver safe
products to patients.
In addition to the contents in this report, the Articles of Association, the Corporate Governance Policy and
the Environmental, Social and Governance (ESG) Guidelines give information regarding the Company’s risk,
goals, strategy and how Ultimovacs interacts with internal external stakeholders and other parties.
Chapters
2
4
5
1
3
47 ULTIMOVACS2022
3) Equity and dividends
The Board aims to maintain a satisfactory equity ratio in the Company, in light of the Company’s goals,
strategy and risk profile, thereby ensuring that there is an appropriate balance between equity and other
sources of financing. The Board shall continuously assess the Company’s capital requirements in light of
the Company’s strategy and risk profile.
The Board’s authorizations to increase the share capital and to buy own shares shall be granted for periods
no longer than until the next Annual General Meeting of the Company.
At the Ordinary General Meeting on 21 April 2022, the Board of Directors was given a general authorization
to increase the share capital by NOK 684,435.22 (20% increase in outstanding shares at the time of the
General Meeting). In addition, the Board of Directors was also authorized increase the share capital by
NOK 342,217.61 (10% increase in outstanding shares at the time of the General Meeting) in relation to the
share-based incentive program (share options) for the employees, and to increase the share capital by
NOK 342,217.61 (10% increase in outstanding shares at the time of the General Meeting) to acquire treasury
shares.
These authorizations are valid until the next ordinary General Meeting of the company in 2023, but no
longer than 30 June 2023.
The Company has historically not distributed dividends and is not expected to do so in the near future.
4) Equal treatment of shareholders and transactions with close associates
There is only one class of shares in the Company and all shares carry equal rights. The Company shall
ensure equal treatment of its shareholders.
Any transactions, agreements or arrangements between the Company and its shareholders, members of
the Board, members of the Executive Management Team or close associates of any such parties shall only
be entered into as part of the ordinary course of business and on arm’s length market terms. All such
transactions shall comply with the procedures set out in the Norwegian Public Limited Liability Companies
Act. In case of a transaction with close associates that is not part of ordinary course of business, the
Board shall arrange for a valuation to be obtained from an independent third party unless the transaction,
agreement or arrangement in question must be considered to be immaterial. The Company’s financial
statements shall provide further information about transactions with related parties. There have been no
such transactions in the financial year.
Board Members and members of the Executive Management Team shall immediately notify the Board if
they have any material direct or indirect interest in any transaction entered into by the Company.
5) Shares and negotiability
The shares in the Company shall be and are freely transferable.
6) General Meetings
All shareholders have the right to participate in the General Meetings of the Company, which exercise the
highest authority of the Company.
The full notice for General Meetings shall be sent to the shareholders no later than 21 days prior to the
meeting. The notices for such meetings shall include documents providing the shareholders with sufficient
detail in order for the shareholders to make an assessment of all the cases to be considered as well as all
relevant information regarding procedures of attendance and voting. The Board and the Company’s auditor
shall be present at General Meetings. Directors of the Board and the CEO have the right to attend and speak
at General Meetings. The Chair of the Board and CEO shall attend General Meetings unless the General
Meeting in each case decides otherwise (the Companies Act Section 5-5).
Chapters
2
4
5
1
3
48 ULTIMOVACS2022
The Chair of the Nomination Committee, or a person authorized by the Chair, shall present the Committee’s
recommendations for the Annual General Meeting, and give an account of the reasons for its recommendations.
Notices for the General Meeting shall provide information on the procedures shareholders must observe in
order to participate in and vote at the General Meeting. The notice should also set out:
i. the procedure for representation at the meeting through a proxy, including a form to appoint a proxy,
and
ii. the right for shareholders to propose resolutions in respect of matters to be dealt with by the General
Meeting.
The cut-off for confirmation of attendance shall be set as short as practically possible and the Board will
arrange matters so that shareholders who are unable to attend in person will be able to vote by proxy. The
form of proxy will be distributed with the notice.
The Code of Practice stipulates that the Board of Directors should ensure that the General Meeting is able
to elect an independent Chair at General meetings. Ultimovacs’ Corporate Governance Policy deviates from
this recommendation by not having such an arrangement in place, both for practical reasons and due to
the size of the company.
7) Nomination committee
The Company has a Nomination Committee as set out in Section 11 and Appendix 1 in the Corporate
Governance Policy. Members and Chairman of the Nomination Committee shall be elected by the General
Meeting. At the outset, the Nomination Committee should consist of three members unless special
circumstances suggest a different number of members.
The members of the Nomination Committee should be selected to take into account the interests of
shareholders in general. Board Members and members of the Executive Management Team should not be
members of the Nomination Committee. Instructions for the Nomination Committee shall be approved by
the Company’s General Meeting.
The Annual General Meeting stipulates the remuneration to be paid to the Nomination Committee. The
Nomination Committee’s expenses shall be covered by the Company.
As per 31 December 2022, all three members of the Nomination committee are independent of the Board
of Directors and the Executive Management Team, and consist of:
- Ole Kristian Hjelstuen (Chair)
- Hans Peter Bøhn (Member)
- Jakob Iqbal (Member)
The Nomination Committee shall present proposals to the General Meeting regarding election of the Chair
of the Board, Board Members and any deputy members of the Board. The Nomination Committee shall
also present proposals to the General Meeting for remuneration of the Board and any sub-committees of
the Board. The Nomination Committee shall justify its recommendations and provide relevant information
about the candidates. Any dissenting votes shall be stated in the recommendation.
In its work, the Nomination Committee may contact shareholders, members of the Board, the Executive
Management Team and external advisers. Shareholders should be given the opportunity to propose Board
Member candidates to the Nomination Committee. The Nomination Committee should conduct individual
discussions with the Board Members to ensure the best possible assessment basis for the Nomination
Committee’s decisions.
Chapters
2
4
5
1
3
49 ULTIMOVACS2022
8) Board of directors: composition and independence
The Board of Directors is elected by the General Assembly. In appointing members to the Board, it is
emphasized that the Board shall have the requisite competency to independently evaluate the cases
presented by the Executive Management Team as well as the Company’s operation. It is also considered
important that the Board can function well as a body of colleagues. Board Members shall be elected for
periods not exceeding two years at a time, with the possibility of re-election. Board Members shall be
encouraged to own shares in the Company.
The Board shall comply with all applicable requirements as set out in the Norwegian Public Limited
Liability Companies, Act, the listing rules of Oslo Børs and the recommendations set out in the Norwegian
Code of Practice for Corporate Governance.
The Board of Directors consists of eight members, of which five men and three women. Seven of the
board members are regarded as fully independent of the company and the main shareholders. Each Board
Member is presented in the next section of this report and on the Company website.
9) The work of the Board of Directors
The Board shall prepare an annual plan for its work with special emphasis on goals, strategy and
implementation. The Board’s primary responsibility shall be:
i. participating in the development and approval of the Company’s strategy,
ii. performing necessary monitoring functions and
iii. acting as an advisory body for the Executive Management Team. Its duties are not static, and the focus
will depend on the Company’s ongoing needs. The Board is also responsible for ensuring that the
operations of the Company are in compliance with the Company’s values and ethical guidelines. The
Chair of the Board shall be responsible for ensuring that the Board’s work is performed in an effective
and correct manner.
The Board shall ensure that the Company has a good management with clear internal distribution of
responsibilities and duties. A clear division of work has been established between the Board and the
Executive Management Team. The CEO is responsible for the executive management of the Company.
All members of the Board shall regularly receive information about the Company’s operational and financial
development. The Company’s strategies shall regularly be subject to review and evaluation by the Board.
The Board shall prepare an annual evaluation of its work.
The Board met 13 times in 2022.
Compensation Committee
The Company does not have a separate Compensation Committee as of today. However, the Board of
Directors has taken upon themselves the role and tasks that a separate committee would have had. The
Board of Directors, acting as a Compensation Committee, will continue to review the employee incentive
plan, as well as the remuneration of the Executive Management Team.
Chapters
2
4
5
1
3
50 ULTIMOVACS2022
Audit Committee
The Company shall have an Audit Committee in accordance with the rules of the Norwegian Public Limited
Liability Companies Act and the listing rules of the Oslo Stock Exchange from the date decided by the
Board of Directors. The Audit Committee’s main function is to be a working committee for the Board,
preparing matters and acting in an advisory capacity for the Company’s finance function. In addition, the
Committee will ensure that the auditor is independent and to ensure that the annual accounts give a
fair picture of the Group’s financial results and financial condition in accordance with generally accepted
accounting practice. The Audit Committee shall receive reports on the work of the external auditor and the
results of the audit.
An Audit Committee was established in the second half of 2019 and has, since 2021, consisted of Board
Members Leiv Askvig (leader) and Haakon Stenrød, both with prior relevant financial and accounting
experience.
The members shall be and are independent of the Company’s senior Executive Management Team.
The Committee met with the financial management before the publication of all quarterly reports and
the 2022 Annual Report in 2023. In addition, the Committee met with the auditor along with the financial
management in Ultimovacs before the publication of the Annual Report 2022, and before the Q2 2022 and
Q4 2022 reports. The Audit Committee will continue to meet with Ultimovacs’ financial management and,
at least twice a year, with the Company’s audit partner before publication of quarterly and full year results.
ESG Committee
The Audit Committee also has the role as the ESG Committee of the Board of Directors. This committee has
been involved in the drafting and review of the Environmental, Social and Governance (ESG) Guidelines and
ESG report. An updated version of these guidelines were approved by the Board of Directors on 2 February
2023.
10) Risk management and internal control
As set out in the corporate governance guidelines of Ultimovacs, the Board of Directors shall ensure that
the Company has sound internal controls and systems for risk management that are appropriate in relation
to the extent and nature of the Company’s activities. The internal control and the systems shall also
encompass the Company’s corporate values and ethical guidelines. The objective of the risk management
and internal control shall be to manage exposure to risks in order to ensure successful conduct of the
Company’s business and to support the quality of its financial reporting.
The Board shall carry out an annual review of the Company’s most important areas of exposure to risk and
its internal control arrangements. The Board shall also focus on the need for developing ethical guidelines
ensuring that employees can safely communicate to the Board matters related to illegal or unethical
conduct by the Company. The Board shall ensure that the Company has the necessary routines with
respect to hired personnel to ensure that any outsourced functions are handled in a satisfactory manner.
The Board is given information on the current business performance and risk situation in board meetings
on a regular basis, which is also presented in quarterly reports made publicly available.
It is of the greatest importance to the Company that all information which could influence the value
of the shares or other financial instruments related to the shares is handled with confidentiality and
communicated to the market in accordance with all financial market regulations.
The Board shall provide an account in the annual report of the main features of the Company’s internal
control and risk management systems as they relate to the Company’s financial reporting. The list of primary
risk factors and how they are mitigated are provided in the “Risk and uncertainties” section in this Annual
Report. The Company’s finance function is responsible for the preparation of financial statements and
reports, and to ensure that these are in accordance with IFRS and other applicable laws and regulations.
These are also reviewed by the Audit Committee. In addition, the annual financial statements are reviewed
by the Company auditor.
The Company has established mechanisms to prevent and address corruption, fraud, bribery and other
irregularities including internal channels for reporting. Such internal channels shall, if required, protect the
identity of the reporter.
Chapters
2
4
5
1
3
51 ULTIMOVACS2022
11) Remuneration of the Board of Directors
The General Meeting shall annually determine the Board’s remuneration. Remuneration of Board Members
shall be reasonable and based on the Board’s responsibilities, work, time invested and the complexity of
the enterprise. The Board shall be informed if individual Board Members perform tasks for the Company
other than exercising their role as Board Members. Work in sub-committees may be compensated in
addition to the remuneration received for Board membership.
The annual Remuneration Report shall provide information regarding the Board’s remuneration. The
Remuneration Report for 2022 is available on Ultimovacs’ website.
12) Remuneration of the Executive Management Team
The Board decides the salary and other compensation to the CEO within any legal boundaries set out in
the Remuneration Guidelines on compensation to the CEO and Executive Management as approved by the
Company’s General Meeting. Any fringe benefits shall be in line with market practice, and should not be
substantial in relation to the CEO’s basic salary. The Board shall annually carry out an assessment of the
salary and other remuneration to the CEO.
The Company’s financial statements shall provide further information about salary and other compensation
to the CEO and the Executive Management Team.
The CEO determines the remuneration of executive employees. The Board shall issue guidelines for the
remuneration of the Executive Management Team for approval by the General Meeting. The guidelines shall
lay down the main principles for the Company’s management remuneration policy. The salary level should
not be of a size that could harm the Company’s reputation, or above the norm in comparable companies.
The salary level should, however, ensure that the Company can attract and retain executive employees with
the desired expertise and experience.
The Executive Management Team does not have bonus arrangements or separate incentive schemes,
but takes part in the general share option incentive scheme which applies to all employees in the Group.
The main objectives of the share option incentive scheme are to align interests of shareholders and
management/employees (value creation and risk taking) and ensure competitive compensation for
management/employees and the motivation to stay (retention). The remuneration guidelines are available
on the Company website. Remuneration details to the Executive Management Team are available in a
separate Remuneration Report, available on the Company website.
13) Information and Communications
The Board and the Executive Management Team assign considerable importance to giving the shareholders
quick, relevant and current information about the Company and its activity areas. Emphasis is placed on
ensuring that the shareholders receive identical and simultaneous information.
Sensitive information will be handled internally in a manner that minimizes the risk of leaks. All material
contracts to which the Company becomes a party, shall contain confidentiality clauses.
The Company shall have clear routines for who is allowed to communicate on behalf of the Company on
different subjects and who shall be responsible for submitting information to the market and investor
community. The CEO, CFO and the Head of Investor Relations & Communications shall be the main contact
persons of the Company in such respect.
The Board should ensure that the shareholders are given the opportunity to make known their points of
view at and outside of the General Meeting.
Financial information is published on a quarterly basis, in addition to the Annual Financial Statements.
The financial information is made available on the Company website as well as through distribution on
Newsweb (Euronext Oslo Stock Exchange’s public information system). A financial calendar is published
annually through the same channels listing important dates such as publications of quarterly and annual
reports and dates of General meetings.
Chapters
2
4
5
1
3
52 ULTIMOVACS2022
14) Take-overs
In a take-over process, the Board and the Executive Management Team each have an individual responsibility
to ensure that the Company’s shareholders are treated equally and that there are no unnecessary
interruptions to the Company’s business activities. The Board has a particular responsibility in ensuring
that the shareholders have sufficient information and time to assess the offer.
In the event of a take-over process, the Board shall ensure that:
i. the Board will not seek to hinder or obstruct any takeover bid for the Company’s operations or
shares unless there are particular reasons for doing so;
ii. the Board shall not undertake any actions intended to give shareholders or others an unreasonable
advantage at the expense of other shareholders or the Company;
iii. the Board shall not institute measures with the intention of protecting the personal interests of its
Members at the expense of the interests of the shareholders; and
iv. the Board must be aware of the particular duty it has for ensuring that the values and interests of
the shareholders are protected.
In the event of a take-over bid, the Board will, in addition to complying with relevant legislation and
regulations, seek to comply with the recommendations in the Norwegian Code of Practice for Corporate
Governance. This includes obtaining a valuation from an independent expert. On this basis, the Board will
make a recommendation as to whether or not the shareholders should accept the bid.
15) Auditor
The Company’s auditor is Ernst & Young AS and has been the Company’s auditor since the financial year
2015.
Each year the auditor shall present to the Board a plan for the implementation of the audit work and a
written confirmation that the auditor satisfies established requirements as to independence and objectivity.
The auditor shall be present at Board meetings where the annual accounts are on the agenda. Whenever
necessary, the Board shall meet with the auditor to review the auditor’s view on the Company’s accounting
principles, risk areas, internal control routines etc.
The auditor may only be used as a financial advisor to the Company provided that such use of the auditor
does not have the ability to affect or question the auditors’ independence and objectiveness as auditor for
the Company. Only the Company’s CEO and/or CFO shall have the authority to enter into agreements in
respect of such counselling assignments.
In connection with the auditor’s presentation to the Board of the annual work plan, the Board should
specifically consider if the auditor also carries out a control function to a satisfactory degree.
The Board shall arrange for the auditor to attend all General Meetings and certain Audit Committee meetings.
Chapters
2
4
5
1
3
53 ULTIMOVACS2022
Chapters
2
3
4
5
1
3
54 ULTIMOVACS2022
The Board of Directors
Jònas Einarsson has been the Chair of the Board since 2018 and has
served as a Board Member since 2011. Mr. Einarsson has over 30 years
of experience in the medical industry and has had and has several
board positions in Norwegian biotech companies. He is currently the
CEO of Radforsk Investment Fund, which position he has held since
2000. Mr. Einarsson was a general practitioner and health director of
the Lardal municipality from 1991 until 2000 and was general manager
of Oslo Private Hospital from 1984 until 1991.
Mr. Einarsson is educated as a Medical Doctor (MD) from the Reykjavik
University, Iceland and the University of Oslo, Norway.
Leiv Askvig has served as a Board Member since 2015 and is currently
also a member of the Audit Committee. Mr. Askvig is an Investment
Advisor for Sundt AS and served as their CEO from 2003 to 2020. Mr.
Askvig has vast experience within the financial industry. He was CEO/
CFO at Opticore AB from 2001 until 2002, CFO at StudentUniverse, Inc.
from 1999 until 2001 and has held various positions within investment
banking at Sundal Collier & Co ASA (now “ABG Sundal Collier”). Mr.
Askvig has significant board experience from a variety of industries.
Mr. Askvig holds a bachelor’s degree in Business Administration from BI
Norwegian Business School and attended the Advanced Management
course at Harvard Business School.
Aitana Peire has served as a Board Member since 2020. Ms. Peire is
an Investment Director of Canica’s Future of Health assets and holds
board positions in Hubro Therapeutics AS and Cercare Medical ApS
(observer). She has wide experience as Industry Analyst, including as
senior consultant in Venture Valuation Switzerland, as Pharma equity
research analyst for Kepler Cheuvreux and as PMA consultant for
Stratas Partners in Basel.
Ms. Peire holds a PhD in Evolutionary Genetics from the University of
Groningen in the Netherlands.
Ketil Fjerdingen has served as a Board Member since 2012 and was the
Chair of the Board of Directors from 2012 until 2018. Mr. Fjerdingen has,
since 2002, been involved in investments and property development
projects through a range of small single purpose companies. Prior to
this, he held various executive management roles with companies
including VI Partners AS, Mobile Media, Ernst & Young and Fokus Bank
ASA.
Mr. Fjerdingen holds the degree of Certified Public Accountant from
NHH Norwegian School of Economics.
Chapters
2
4
5
1
3
55 ULTIMOVACS2022
The Board of Directors
Henrik Schüssler has served as a Board Member since 2015. Mr.
Schüssler is the CEO and board member of Gjelsten Holding AS,
which position he has held since 2000. Mr. Schüssler was CEO and
CFO at Norway Seafoods ASA from 1995 until 2000 and accountant/
consultant at Ernst & Young AS from 1987 until 1995. Mr. Schüssler has
significant board experience from several other companies.
Mr. Schüssler holds a Bachelor of Chartered Accounting from BI
Norwegian Business School.
Kari Grønås has served as a Board Member since 2019. Kari Grønås
has broad experience from the pharmaceutical/biotech industry. She
has extensive experience in drug development and commercialization
within the pharmaceutical industry of new breakthrough products
securing regulatory approvals, i.e. Xofigo, Hexvix. Grønås also holds
significant leadership and management experience including
leadership of cross functional and governance teams from Bayer/
Algeta ASA, PhotoCure and Nycomed Imaging/Amersham Health (Now
GE Healthcare). Today she is a consultant within the sector and holds
board positions in Spago Nanomedical AB, Arxx AS and The Norwegian
Lung Cancer Society.
Ms. Grønås holds a Cand. Pharm. degree from the University of Oslo.
Eva S. Dugstad has served as a Board Member since 2019. Ms. Dugstad
started as Manager for Business and Community Relations at Faculty
of Mathematics and Natural Sciences, University of Oslo, in February
2022. She joined Ultimovacs’ Board during her tenure as Director for
Business Development in Radforsk Investment Fund, a position she
had held since 2017. Her previous appointments include the President
and the Exec. Vice President at the Institute for Energy Technology
(IFE), where she also was the Chair of the Board for IFE Venture. Ms.
Dugstad has been involved in various boards in both public and private
sector and in several public expert panels.
Ms. Dugstad holds a Cand. Pharm. degree from the University of Oslo.
Haakon Stenrød has served as a Board Member since 2020 and is
currently also a member of the Audit Committee. Mr. Stenrød is a
Senior Investment Manager at Watrium. Prior to joining Watrium, Mr.
Stenrød spent 12 years in the Investment Banking department of ABG
Sundal Collier, focusing on M&A, restructurings and capital markets
advisory. He is currently a Board member of DF Capital, a UK challenger
bank listed on AIM London.
In addition, he holds a Master in Industrial Economics and Technology
management from NTNU, studied at London School of Economics and
was an officer in the Royal Norwegian Army.
Chapters
2
4
5
1
3
56 ULTIMOVACS2022
04
Financial Statements
- Ultimovacs Group
Financial Statements
Notes
Chapters
4
2
3
5
1
57 ULTIMOVACS2022
Contents - Consolidated Financial Statement
Consolidated statement of profit and loss and other comprehensive income
Consolidated statement of financial position
Consolidated statement of cash flow
Consolidated statement of changes in equity
Note 1: General information
Note 2: Accounting principles
Note 3: Government grants
Note 4: Salary and personnel expenses and management remuneration
Note 5: Other operating expenses
Note 6: Financial items
Note 7: Income tax
Note 8: Earnings per share
Note 9: Non-current assets
Note 10: Other receivables
Note 11: Cash and cash equivalents
Note 12: Share capital, shareholder information and dividend
Note 13: Transactions with related parties
Note 14: Leases and commitments
Note 15: Share based payment
Note 16: Other current liabilities
Note 17: Financial instruments
Note 18: Events after the balance sheet date
58
59
60
61
62
62
69
70
72
72
73
74
75
78
78
78
81
82
83
85
85
87
Chapters
4
2
3
5
1
58 ULTIMOVACS2022
Financial statements
Consolidated statement of profit and loss and other comprehensive income
(NOK 1 000) EXCEPT PER SHARE DATA NOTES 2022 2021
Total revenues - -
Payroll and payroll related expenses
3, 4, 15
(71 466) (61 916)
Depreciation and amortization
9, 14
(2 648) (2 703)
Other operating expenses
3, 5
(109 517) (99 213)
Total operating expenses (183 631) (163 832)
Operating profit (loss) (183 631) (163 832)
Financial income
6
17 375 13 383
Financial expenses
6
(1 536) (14 272)
Net financial items 15 839 (890)
Profit (loss) before tax (167 792) (164 722)
Income tax expense
7
- -
Profit (loss) for the year (167 792) (164 722)
Items that subsequently may be reclassified to profit or loss:
Exchange rate differences on translation of foreign operations (1 889) (3 953)
Total comprehensive income (loss) for the year (169 681) (168 676)
Non-controlling interest - -
Owners of the Company (169 681) (168 676)
Total comprehensive income (loss) for the year (169 681) (168 676)
Basic and diluted earnings (loss) per share (NOK per share)
8
(4.9) (5.1)
Chapters
1
5
2
3
4
59 ULTIMOVACS2022
Financial statements
Consolidated statement of financial position
(NOK 1 000) NOTES 2022 2021
ASSETS
Non-current assets
Goodwill
9
10 701 11 031
Licenses
9
51 944 53 549
Patents
9
5 784 6 539
Property, plant and equipment
9
220 212
Right of use assets
14
5 444 1 951
Total non-current assets 74 093 73 282
Current assets
Receivables and prepayments
3, 10
10 270 8 087
Cash and cash equivalents
11
425 309 574 168
Total current assets 435 579 582 255
TOTAL ASSETS 509 672 655 537
EQUITY AND LIABILITIES
Equity
Share capital 3 440 3 422
Share premium 1 076 308 1 070 841
Total paid-in equity 1 079 747 1 074 264
Accumulated losses (672 113) (504 321)
Other equity 40 752 20 358
Translation differences 964 2 853
TOTAL EQUITY
12
449 350 593 152
Non-current liabilities
Lease liability
14
3 713 457
Deferred tax
7
10 701 11 031
Total non-current liabilities 14 414 11 488
Current liabilities
Lease liability
14
1 767 1 628
Accounts payable 7 655 22 555
Other current liabilities
15, 16
36 485 26 714
Total current liabilities 45 907 50 897
TOTAL LIABILITIES 60 321 62 384
TOTAL EQUITY AND LIABILITIES 509 672 655 537
Board of Directors and CEO of Ultimovacs ASA
Oslo, 23 March 2023
Sign Sign
Sign
Jónas Einarsson Kari Grønås Eva S. Dugstad
Chair of the Board Board member Board member
Sign
Sign
Sign
Henrik Schüssler Ketil Fjerdingen Leiv Askvig
Board member Board member Board member
Sign Sign
Sign
Aitana Peire Haakon Stenrød Carlos de Sousa
Board member Board member CEO
Chapters
1
5
2
3
4
60 ULTIMOVACS2022
Financial statements
Consolidated statement of cash flow
(NOK 1 000) NOTES 2022 2021
Cash flow from operating activities
Profit (loss) before tax (167 792) (164 722)
Adjustments to reconcile profit before tax to net cash flow:
Depreciation and amortization
9, 14
2 648 2 703
Interest received including investing activities
6
(8 887) (3 062)
Net foreign exchange differences
6
(7 176) 3 619
Other financial expenses
14
105 179
Share option expenses
15
20 395 11 595
Working capital adjustment:
Changes in prepayments and other receivables
10
(1 859) 351
Changes in payables and other current liabilities
16
(5 129) 23 509
Net cash flow from operating activities (167 695) (125 828)
Cash flow from investing activities
Purchase of property, plant and equipment
9
(195) (85)
Patent milestone payments
13
- -
Interest received
6
8 887 3 062
Net cash flow from investing activities 8 691 2 977
Cash flow from financing activities
Proceeds from issuance of equity
12
5 484 272 864
Share issue cost
12
- (11 012)
Interest paid
14
(105) (179)
Payment of lease liability
14
(1 802) (1 716)
Net cash flow from financing activities 3 577 259 957
Net change in cash and cash equivalents
11
(155 426) 137 106
Effect of change in exchange rate
6
(6 567) (3 863)
Cash and cash equivalents, beginning of period
11
574 168 440 925
Cash and cash equivalents, end of period 425 309 574 168
Chapters
1
5
2
3
4
61 ULTIMOVACS2022
Financial statements
Consolidated statement of changes in equity
(NOK 1000) NOTES
SHARE
CAPITAL
SHARE
PREMIUM
TOTAL
PAID IN
CAPITAL
ACCU-
MULATED
LOSSES
OTHER
EQUITY
TRANS-
LATION
DIFFER-
ENCES
TOTAL
EQUITY
Balance as of 31 December 2020 3 197 809 214 812 411 (339 599) 8 762 6 806 488 380
Profit (loss) for the year - (164 722) (164 722)
Other comprehensive income (loss) - (3 953) (3 953)
Issue of share capital
12
225 272 640 272 864 272 864
Share-issue costs
12
(11 012) (11 012) (11 012)
Recognition of share-based payments
15
- 11 595 11 595
Balance as of 31 December 2021 3 422 1 070 841 1 074 264 (504 321) 20 358 2 853 593 152
Profit (loss) for the year - (167 792) (167 792)
Other comprehensive income (loss) - (1 889) (1 889)
Issue of share capital
12
17 5 466 5 484 5 484
Share-issue costs
12
- -
Recognition of share-based payments
15
- 20 395 20 395
Balance as of 31 December 2022 3 440 1 076 308 1 079 747 (672 113) 40 752 964 449 350
Chapters
1
5
2
3
4
62 ULTIMOVACS2022
Financial statements
Note 1: General information
Note 2: Accounting principles
I. Basis for preparation
The financial statements for the Group have been prepared in accordance with IFRS as adopted by the
EU (IFRS). The financial statements are presented in NOK (Norwegian kroner) which is also the parent
company’s functional currency.
The financial statements have been prepared on the historical cost basis, with the exception of derivatives
which are measured at fair value. The preparation of financial statements in conformity with IFRS requires
the use of certain critical accounting estimates. It also requires management to exercise its judgments in
applying the Group’s accounting policies.
II. Going concern
The financial statements for 2022 have been prepared under the going concern assumption.
III. Accounting principles
i. Cash and cash equivalents
Cash and cash equivalents in the statement of financial position comprise cash at banks and on hand and
short-term deposits with maturity of three months or less, which are subject to an insignificant risk of
changes in value.
ii. Cash Flow statement
The statement of cash flows is compiled using the indirect method. The statement of cash flows
distinguishes between cash flows from operating, investing and financing activities. For the purpose of the
cash flow statement, cash and cash equivalents comprise cash on hand, deposits held at call with banks,
other short-term highly liquid investments with original maturities of three months or less, cash pool
balances and bank overdrafts. Cash flows in foreign currencies are translated at the rate of the transaction
date. Interest paid is included under cash flow from financing activities, and interest received is included
in investing activities. Cash flows arising from the acquisition or disposal of financial interests (subsidiaries
and participating interests) are recognized as cash flows from investing activities, taking into account
any cash and cash equivalents in these interests. Dividends paid out are recognized as cash flows from
financing activities; dividends received are recognized as cash flows from investing activities. Cash flows
from share issues are recognized as cash flows from financing activities.
Ultimovacs ASA (the Company or Ultimovacs) and its subsidiary (together the Group) is a biotech Group
developing novel immunotherapies against cancer. Ultimovacs was established in 2011 and is a public limited
liability company listed on the Stock Exchange in Norway. The Company and its proprietary technology are
based on pre-clinical and clinical research on immunotherapies conducted at the Oslo University Hospital.
Ultimovacs is headquartered at the Oslo Cancer Cluster Innovation Park in Oslo, Norway and also has an
office in Uppsala, Sweden. Ultimovacs is an active member of Oslo Cancer Cluster.
Ultimovacs’ lead universal cancer vaccine candidate UV1 leverages the high prevalence of the human
telomerase (hTERT) to be effective across the dynamic stages of a tumor’s growth and its microenvironment.
By directing the immune system to hTERT antigens which are expressed at a high level in 85-90% of
human tumors, UV1 drives CD4 helper T cells to tumors with the goal of activating an immune system
cascade to increase anti-tumor responses. Ultimovacs’ strategy is to clinically demonstrate UV1’s
impact in many cancer types and in combination with other immunotherapies. The Group will expand its
pipeline using its novel TET-platform which is a vaccine technology that can generate multiple vaccine
candidates designed to achieve increased T cell responses to a broad range of target antigens. The Group
is performing a broad clinical development program with clinical trials in Europe, Australia and the USA.
The financial statements were approved by the Board of Directors on 23 March 2023.
Chapters
1
5
2
3
4
63 ULTIMOVACS2022
Financial statements
Note 2: Accounting principles (continued)
iii. Financial instruments
The Group uses derivative financial instruments to hedge its risks associated with foreign exchange rates.
Derivatives are initially and subsequently measured at fair value. Derivatives are carried as assets when the
fair value is positive and as liabilities when the fair value is negative. The gain/(loss) arising from changes in
fair value of currency derivatives is presented as part of “Financial income/expenses” in the consolidated
statement of comprehensive income.
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit
or loss and other comprehensive income, loans and borrowings, or payables. All financial liabilities are
recognized initially at fair value and, in the case of loans and borrowings and payables, net of directly
attributable transaction costs. The Group’s financial liabilities include trade and other payables.
- Subsequent measurement
The measurement of financial liabilities depends on their classification.
- Loans and borrowings
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortized
cost using the effective interest rate method. Gains and losses are recognized in profit or loss when the
liabilities are derecognized as well as through the effective interest rate amortization process. Amortized
cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are
an integral part of the effective interest rate. The effective interest rate amortization is included as finance
costs in the statement of profit or loss and other comprehensive income.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are
categorized within the fair value hierarchy, described as follows, based on the lowest level input that is
significant to the fair value measurement as a whole:
• Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities
• Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value
measurement is directly or indirectly observable
• Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value
measurement is unobservable
Chapters
1
5
2
3
4
64 ULTIMOVACS2022
Financial statements
Note 2: Accounting principles (continued)
iv. Current vs non-current classification
The Group presents assets and liabilities in the statement of financial position based on current/non-
current classification. An asset is current when it is:
• Expected to be realized or intended to be sold or consumed in the normal operating cycle
• Held primarily for the purpose of trading
• Expected to be realized within twelve months after the reporting period, or
• Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at
least twelve months after the reporting period
All other assets are classified as non-current. A liability is current when:
• It is expected to be settled in the normal operating cycle
• It is held primarily for the purpose of trading
• It is due to be settled within twelve months after the reporting period, or
• There is no unconditional right to defer the settlement of the liability for at least twelve months
after the reporting period
The Group classifies all other liabilities as non-current. Deferred tax assets and liabilities are classified as
non-current assets and liabilities.
v. Foreign currencies
The Group’s presentation currency is NOK. This is also the parent company’s functional currency. The
statement of financial position figures of entities with different functional currency are translated at the
exchange rate prevailing at the end of the reporting period for balance sheet items, and the exchange
rate at the date of the transaction for profit and loss items. The monthly average exchange rates are
used as an approximation of the transaction exchange rate. Exchange differences are recognized in other
comprehensive income (OCI).
Transactions in foreign currencies are initially recorded by the Group in its respective functional currency
spot rate at the date the transaction first qualifies for recognition. Monetary assets and liabilities
denominated in foreign currencies are translated at the functional currency spot rates of exchange at the
reporting date. Differences arising on settlement or translation of monetary items are recognized in the
statement of profit or loss and other comprehensive income.
Intra-group balances and transactions, and any unrealized income and expenses arising from intra-group
transactions, are eliminated. Unrealized losses are eliminated in the same way as unrealized gains, but only
to the extent that there is no evidence of impairment.
The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on
acquisition, are translated into NOK at the exchange rates at the reporting date.
The income and expenses of foreign operations are translated into NOK at the average exchange rates
within each respective month of the date of the transactions. Foreign currency differences are recognized
in other comprehensive income (OCI) and accumulated in the translation reserve.
Exchange differences on intra-group items are recognized in profit or loss of the respective company and
Group accounts.
Chapters
1
5
2
3
4
65 ULTIMOVACS2022
Financial statements
Note 2: Accounting principles (continued)
vi. Impairment
The Group assesses at each reporting date whether there is an indication that an asset may be impaired.
If any indication exists, or when annual impairment testing for an asset is required, the Group estimates
the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or CGU’s (cash-
generating unit) fair value less costs of disposal and its value in use. It is determined for an individual asset,
unless the asset does not generate cash inflows that are largely independent of those from other assets or
groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset
is considered impaired and is written down to its recoverable amount.
Goodwill is tested annually for impairment, as well as when there is any indication that the goodwill may
be impaired. For impairment testing, assets are grouped together into the smallest group of assets that
generates cash inflows from continuing use that are largely independent of the cash inflows of other
assets or cash generating units (CGU). Goodwill arising from a business combination is allocated to CGUs
or groups of CGUs that are expected to benefit from the synergies of the combination. An impairment loss
is recognized in the income statement when the carrying amount of CGU, including the goodwill, exceeds
the recoverable amount of the CGU. Recoverable amount of the CGU is the higher of the CGU’s fair value
less cost to sell and value in use.
The Group has goodwill created by deferred tax which is tested for impairment annually.
vii. Business combination and consolidation
The Group accounts for business combinations using the acquisition method when control is transferred
to the Group. The consideration transferred in the acquisition is generally measured at fair value, as are the
identifiable net assets acquired. Any goodwill that arises is tested annually for impairment. Any gain on a
bargain purchase is recognized in profit or loss immediately. Transaction costs are expensed as incurred,
except if related to the issue of debt or equity securities.
The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement
with the entity and has the ability to affect those returns through its power over the entity. The financial
statements of subsidiaries are included in the consolidated financial statements from the date on which
control commences until the date on which control ceases.
When the Group loses control over a subsidiary, it derecognizes the assets and liabilities of the subsidiary,
and any related non-controlling interests and other components of equity. Any resulting gain or loss
is recognized in profit or loss. Any interest retained in the former subsidiary is measured at fair value
when control is lost. When a foreign operation is disposed of in its entirety or partially such that control,
significant influence or joint control is lost, the cumulative amount in the translation reserve related to
that foreign operation is reclassified to profit or loss as part of the gain or loss on disposal. If the Group
disposes of part of its interest in a subsidiary but retains control, then the relevant proportion of the
cumulative amount is reattributed to non-controlling interests.
viii. Contingent liabilities
Contingent liabilities are not recognized in the statement of financial position but are reported in the
relevant schedules and notes. They may arise from uncertainty as to the existence of a liability represent a
liability in respect of which the amount cannot be reliably measured. Contingent liabilities are disclosed if
the possibility of an outflow of economic benefit to settle the obligation is more than remote.
ix. Interest income
Interest income is recognized using the effective interest method.
Chapters
1
5
2
3
4
66 ULTIMOVACS2022
Financial statements
Note 2: Accounting principles (continued)
x. Earnings per share
The basic earnings per share are calculated as the ratio of the total profit (loss) for the year divided by the
weighted average number of ordinary shares outstanding. When calculating the diluted earnings per share,
the profit that is attributable to the ordinary shareholders and the weighted average number of ordinary
shares outstanding are adjusted for all the dilution effects relating to share options.
No dilutive effect has been recognized as potential ordinary shares only shall be treated as dilutive if
their conversion to ordinary shares would decrease earnings per share or increase loss per share from
continuing operations. As the Group is currently loss-making, an increase in the average number of shares
would have anti-dilutive effects. As the Group has currently no issuable potential ordinary shares and basic
and diluted earnings per share is the same.
xi. Government grants
Government grants are recognized where there is reasonable assurance that the grant will be received, and
all attached conditions will be complied with. When the grant relates to an expense item, it is recognized
as income on a systematic basis over the periods that the costs, which it is intended to compensate,
are expensed. Government grants have been recognized in the statement of profit or loss and other
comprehensive income as a reduction of personnel- and other operating expenses.
Where the grant relates to an asset, it is recognized as income in equal amounts over the expected useful
life of the related asset. If the Group receives non-monetary grants, the asset and the grant are recorded
gross at nominal amounts and released to profit or loss over the expected useful life of the asset, based
on the pattern of consumption of the benefits of the underlying asset by equal annual instalments.
xii. IFRS 16 Leases
Under IFRS 16, the Group recognizes right-of-use assets and lease liabilities for all leases.
Right-of-use assets are measured at an amount equal to the lease liability and are subsequently depreciated
using the straight-line method from the commencement date to the earlier of the end of the useful life of
the right-of-use asset or the end of the lease term.
The estimated useful lives of right-of-use assets are determined on the same basis as those of property
and equipment. In addition, the right-of-use asset is reduced by impairment losses, if any, and adjusted
for certain remeasurements of the lease liability.
The lease liability is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be
readily determined, Ultimovacs’ incremental borrowing rate. The incremental borrowing rate is used as the
discount rate.
When applying the practical expedients in IFRS 16 for lease-contracts with low value or lease terms of
less than 12 months, the lease payments (net of any incentives received from the lessor) are taken to the
statement of profit and loss and other comprehensive income on a straight-line basis over the period of
the lease. When the lease is terminated before the lease period has expired, any payment required to be
made to the lessor by way of penalty is recognized as an expense in the period in which termination takes
place.
Chapters
1
5
2
3
4
67 ULTIMOVACS2022
Financial statements
Note 2: Accounting principles (continued)
xiii. Share-based payments
Employees in the Group receive remuneration in the form of share-based payment transactions, whereby
employees render services as consideration for equity instruments (equity-settled transactions) or granted
share appreciation rights, which can be settled in cash (cash-settled transactions). The determination of
whether the arrangement is cash or equity settled is based on a careful evaluation of the terms of the
agreement and also the Group’s ability to settle in shares and the promise and intent of settlement in cash.
- Cash-settled transactions:
A liability is recognized for the fair value of cash-settled transactions. The fair value is measured initially
and at each reporting date up to and including the settlement date, with changes in fair value recognized in
payroll and payroll related expenses. The fair value is expensed over the period until the vesting date with
recognition of a corresponding liability. The fair value is determined using a Black Scholes model.
- Equity-settled transactions
The cost of equity-settled transactions is recognized in payroll and other payroll related expenses, together
with a corresponding increase in equity over the period in which the service and, where applicable, the
performance conditions are fulfilled (the vesting period). The cumulative expense recognized for equity-
settled transactions at each reporting date until the vesting date reflects the extent to which the vesting
period has expired and the Company’s best estimate of the number of equity instruments that will ultimately
vest. The expense or credit in the statement of profit or loss and other comprehensive income for a period
represents the movement in cumulative expense recognized as of the beginning and end of that period.
xiv. Intangible assets
Intangible assets are stated at their historical cost and amortized on a straight-line basis over their
expected useful lives, which usually varies from 3 to 10 years and up to 20 years for patents. An adjustment
is made for any impairment. Intangible items acquired in a business combination must be recognized as
assets separately from goodwill if they meet the definition of an asset, are either separable or arise from
contractual or other legal rights, and their fair value can be measured reliably.
All research and development spending is expensed each year in the period in which it is incurred.
Development costs will be capitalized once the “asset” being developed has met requirements of technical
and commercial feasibility to signal that the intangible investment is likely to either be brought to market
or sold. Due to uncertainties regarding award of patents, regulations, ongoing clinical trials etc., the asset
recognition criteria of IAS 38 “Intangible Assets” are not met.
xv. Property, plant and equipment
Property, plant and equipment are recognized at cost less accumulated depreciation and any impairment
losses. Such cost includes the cost of replacing parts of the property, plant and equipment and borrowing
costs for long-term construction projects if the recognition criteria are met. When significant parts of
property, plant and equipment are required to be replaced at intervals, the Group recognizes such parts
as individual assets with specific useful lives and depreciates them accordingly. Likewise, when a major
inspection is performed, its cost is recognized in the carrying amount of the plant and equipment as a
replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognized
in the statement of profit and loss and other comprehensive income as incurred.
Chapters
1
5
2
3
4
68 ULTIMOVACS2022
Financial statements
Note 2: Accounting principles (continued)
xvi. Tax
The income tax expense includes tax payable and changes in deferred tax. Income tax on balances
recognized in other comprehensive income is recognized as other comprehensive income, and tax on
balances related to equity transactions is recognized in equity. The tax payable for the period is calculated
according to the tax rates and regulations ruling at the end of the reporting period.
Deferred tax is calculated on temporary differences between book and tax values of assets and liabilities
and the tax effects of losses to carry forward in the consolidated financial statements at the reporting
date. Deferred tax liabilities and assets are calculated according to the tax rates and regulations ruling at
the end of the reporting period and at nominal amounts. Deferred tax liabilities and assets are recognized
net when the Group has a legal right to net assets and liabilities.
Deferred tax assets are recognized only to the extent that it is probable that future taxable profits will be
available which the loss carry forward or other deductible temporary differences can be utilized. Currently
no deferred tax assets are recognized in the statement of financial position as the utilization is uncertain.
xvii. Segments
The Group is still in a R&D phase, and currently does not generate revenues. For management purposes, the
Group is organized as one business unit and the internal reporting is structured in accordance with this.
All non-current assets are located at the Group’s main office in Oslo, Norway.
IV. Significant estimates and judgements
In order to prepare the financial statements, management and the Board may have to make various judgments
and estimates that can affect the amounts recognized in the financial statements for assets, liabilities
and expenses. Uncertainties about these adjustments and estimates could result in outcomes that require
adjustment to the carrying amount of assets or liabilities affected in future periods. Assumptions and
estimates were based on available information at the time of the preparation of the financial statements.
Existing circumstances and assumptions about future developments, however, may change and such
changes are reflected when they occur.
- Share-based payments
Estimating fair value for share-based payment transactions requires determination of the most appropriate
valuation model, which depends on the terms and conditions of the grant. This estimate also requires
determination of the most appropriate inputs to the valuation model including the expected life of the
share option or appreciation right, volatility and dividend yield and making assumptions about them.
- Taxes
Deferred tax assets are recognized for unused tax losses to the extent that it is probable that taxable
profit will be available against which the losses can be utilized. The Group considers that a deferred tax
asset related to accumulated tax losses cannot be recognized in the statement of financial position until
the product under development has been approved for marketing by the relevant authorities. Significant
management judgement is required to determine the amount, if any, of deferred tax assets that can be
recognized, based upon the likely timing and the level of future taxable profits, together with future tax
planning strategies.
- Impairment of goodwill and intangible assets
The Group follows the guidance of IAS 36 to determine when impairment indicators exist for its goodwill
and intangible assets. When impairment indicators exist, the Group is required to make a formal estimate
of the recoverable amount of its intangible assets. This determination requires significant judgment. In
making this judgment, management evaluates external and internal factors, such as significant adverse
changes in the technological, market, economic or legal environment in which the Group operates as well
as the results of its ongoing development programs. Management also considers the carrying amount of
the Group’s net assets in relation to its market capitalization as a key indicator.
Chapters
1
5
2
3
4
69 ULTIMOVACS2022
Financial statements
GRANTS RECOGNIZED (NOK 1 000) 2022 2021
Skattefunn 4 750 4 750
Eurostars - 786
Industrial Ph.D. grant from The Research Council of Norway (Forskningsrådet) 594 802
Innovation Project grant from The Research Council of Norway (Forskningsrådet) 4 194 5 241
Innovation Norway - 3 000
Total grants 9 538 14 578
COSTS DEDUCTED (NOK 1 000) 2022 2021
Payroll and payroll related expenses 1 822 2 472
Other operating expenses 7 717 12 106
Total costs deducted 9 538 14 578
GRANTS RECEIVABLES (NOK 1 000) 2022 2021
Skattefunn 4 750 4 750
Industrial Ph.D. grant from The Research Council of Norway (Forskningsrådet) 198 267
Innovation Project grant from The Research Council of Norway (Forskningsrådet) 42 296
Total grants receivables 4 990 5 314
Note 3: Government grants
The following government grants have been recognized in the statement of profit and loss:
Skattefunn:
The Skattefunn R&D tax incentive scheme is a government program designed to stimulate research and
development in Norwegian. In FY2022, four Skattefunn-grants were approved, two of which reported in
2022, one will report in 2024 and one in 2025.
Industrial Ph.D. grant from The Research Council of Norway (Forskningsrådet):
The industrial Ph.D. project is a collaboration between Ultimovacs ASA, Oslo University Hospital and the
University of Oslo. The Ph.D. candidate for this project is employed by Ultimovacs. The project aims to
characterize the immunological mechanisms induced by treatment with a peptide-based therapeutic
cancer vaccine. The project ended in and reported in December 2022.
Innovation Project grant from The Research Council of Norway (Forskningsrådet):
Innovation Project for the Industrial Sector is a funding instrument that provides grants to business-led
innovation projects that make extensive use of research and development activities. The FOCUS Phase II
trial has been granted an innovation grant of up to MNOK 16 from the Norwegian Research Council.
Innovation Norway:
Innovation Norway is the Norwegian Government’s most important instrument for innovation and
development of Norwegian enterprises and industry. Innovation Norway has granted Ultimovacs MNOK 10
to support the execution of the Phase II DOVACC study.
All conditions and contingencies attached to the grants recognized in the accounts have been fulfilled.
Grants receivable as per 31 December are detailed as follows:
Government grants have been recognized in the statement of profit and loss and other comprehensive
income as a reduction for the related expenses with the following amounts:
Chapters
1
5
2
3
4
70 ULTIMOVACS2022
Financial statements
PAYROLL AND PAYROLL RELATED EXPENSES (NOK 1 000) 2022 2021
Salaries and holiday pay 38 215 34 543
Social security tax 9 142 6 686
Social security tax related to options 2 016 8 557
Pension expenses 2 818 2 690
Share-based compensation 20 395 11 595
Other personnel expenses 702 318
Government grants (1 822) (2 472)
Total payroll and payroll related expenses 71 466 61 916
Number of FTEs employed during the financial year 23.2 21.3
Number of FTEs at end of year 23.2 23.5
Note 4: Salary and personnel expenses and management remuneration
The Group’s Management team consists of the Company’s CEO, CFO and the managers of each department,
totaling ten employees. Anne Worsøe (Head of IR and Communication) and Orla Mc Callion (Head of
Regulatory and QA), joined the company in October 2021. Ton Berkien and Orla Mc Callion are both employed
in Ultimovacs AB.
EXECUTIVE REMUNERATION (NOK 1 000) 2022 2021
Management Team remuneration 37 599 30 989
Board of Director’s remunerations 2 055 1 915
There were no outstanding loans or guarantees made to related parties, the Board of Directors, the
Management Team or any other employees as of 31 December 2021 or as of 31 December 2022.
Please refer to the Remuneration Report 2022 for more information.
Pensions
Ultimovacs ASA is required to have an occupational pension scheme in accordance with the Norwegian
law on required occupational pension (“lov om obligatorisk tjenestepensjon”). The company has a
defined contribution pension scheme which complies with the Act on Mandatory company pensions.
As at 31 December 2022, all twenty of Ultimovacs ASA’s employees were covered by the pension
scheme. A similar pension scheme is in place for the five employees in Ultimovacs AB in Sweden.
Other than the general pension schemes described above, there are no specific pension arrangements made for
any member of the Management team. The Group has no pension or retirement benefits for its Board Members.
The total pension contributions for all employees recognized as expenses equalled MNOK 2.7 and MNOK
2.8 in 2021 and 2022 respectively.
Chapters
1
5
2
3
4
71 ULTIMOVACS2022
Financial statements
Note 4: Salary and personnel expenses and management remuneration (continued)
Severance pay/pay after termination of employment
Under certain conditions, the CEO is entitled to 12 months’ severance pay. The severance pay period will be
extended to 18 months if the termination of the CEO takes place in connection with a ‘change of control’
event in the Company.
The company’s CFO is entitled to receive pay after termination of his employment with the Group equal to
9 months’ base salary in addition to payment of his salary during his 3-month notice period.
There are no similar arrangements for any of the other employees of the Group with respect to termination
of their employment.
Other benefits received
There is no bonus scheme in the Group, however, sign-on-fees and bonus may be applied at the Board’s
discretion.
Statement on the executive employee remuneration policy during the previous financial year
The executive compensation for the fiscal year 2022 has been in accordance with the Remuneration
Guidelines for 2022. Please refer to Remuneration Guidelines 2022 and Remuneration Report 2022 available
on Ultimovacs’ website for more information.
Chapters
1
5
2
3
4
72 ULTIMOVACS2022
Financial statements
OTHER OPERATING EXPENSES (NOK 1 000) 2022 2021
External R&D expenses 95 175 96 735
Clinical studies 66 772 56 675
Manufacturing costs 19 899 21 455
Other R&D expenses 8 504 18 605
Patent related expenses 3 571 3 540
Rent, office and IT 4 221 3 645
Accounting, audit, legal, consulting 9 246 5 061
Other operating expenses 5 020 2 338
Less government grants (7 717) (12 106)
Total operating expenses 109 517 99 213
Note 5: Other operating expenses
SPECIFICATION AUDITOR'S FEE (NOK 1 000) 2022 2021
Statutory audit 404 243
Audit related services 40 61
Tax related services 10 -
Other 3 10
Total auditor’s fee 456 313
VAT is not included in the fees specified above.
Note 6: Financial items
FINANCIAL INCOME (NOK 1 000) 2022 2021
Foreign exchange gains - related to derivatives 5 053 9 042
Foreign exchange gains - related to EUR bank account 2 087 849
Foreign exchange gains - other 1 329 430
Interest income 8 906 3 062
Total financial income 17 375 13 383
FINANCIAL EXPENSES (NOK 1 000) 2022 2021
Foreign exchange losses - related to derivatives - 10 520
Foreign exchange losses - related to EUR bank account - 2 702
Foreign exchange losses - other 1 293 717
Other financial expenses 243 333
Total financial expenses 1 536 14 272
The Group is in a development phase, and the majority of the Group’s costs are related to R&D. These
costs are expensed in the statement of profit and loss and other comprehensive income.
Total expenses related to R&D, including other operating expenses, payroll and payroll related expenses,
less government grants, amounted to MNOK 123.1 in 2021 and MNOK 128.5 in 2022.
Chapters
1
5
2
3
4
73 ULTIMOVACS2022
Financial statements
TAX EXPENSE BASIS (NOK 1 000) 2022 2021
Profit (loss) before tax (167 792) (164 722)
Net non-taxable income (4 759) (4 750)
Other items* 18 089 (116)
Change in temporary differences 1 051 7 248
Basis for tax calculation (153 411) (162 340)
Note 7: Income tax
* The share issue cost of MNOK 11.0 in 2021 was deducted directly from equity and is included in the
basis for tax calculation as the tax-effect is charged directly to equity.
The corporate tax rate in Norway was 22% in 2021 and 2022. The corporate tax rate in Sweden was 20.6%
in 2021 and 2022, which is the basis of the deferred tax calculation for Ultimovacs AB.
INCOME TAX EXPENSE (NOK 1 000) 2022 2021
Expected tax expense (36 821) (36 049)
Net non-taxable income (1 049) (1 045)
Other items 3 980 (26)
Change in deferred tax assets not recognized 33 888 37 119
Income tax expense - -
Ultimovacs has not recognized a deferred tax asset in the statement of financial position related to its previous
losses, as the Group does not expect taxable income to be generated in the short-term to support the use
of the deferred tax asset. Total tax losses carried forward and temporary differences as per 31 December
2021 was MNOK 513.8, and MNOK 669.9 as per 31 December 2022 (of which MNOK 33.4 in Ultimovacs AB).
In relation to purchase price allocation conducted of Ultimovacs AB, acquired in July 2018, all excess value
has been allocated to the license agreement which gives access to the TET-technology. A deferred tax
liability of MNOK 10.7 has been calculated on the excess values utilizing the tax rate in Sweden of 20.6%.
Please see note 9 for more information.
INCOME TAX EXPENSE (NOK 1 000) 2022 2021
Tax losses carried forward 709 118 555 707
Temporary differences - financial instruments (1 083) (759)
Temporary differences - leasing liability 37 134
Temporary differences - licenses (51 944) (53 549)
Temporary differences - social security on options 13 488 12 009
Temporary differences - PP&E 238 246
Temporary differences and tax loss carry forward 669 854 513 788
Deferred tax assets - not recognized in statement of financial position 158 329 124 440
Deferred tax liability per 31 December 10 701 11 031
Chapters
1
5
2
3
4
74 ULTIMOVACS2022
Financial statements
Note 8: Earnings per share
The basic earnings per share (EPS) are calculated as the ratio of the total profit (loss) for the
year divided by the weighted average number of ordinary shares outstanding. As the Group has
currently no potential issuable ordinary shares, basic and diluted earnings per share is the same.
The issued share options have a potential dilutive effect on earnings per share. No dilutive effect has been
recognized, as potential ordinary shares only shall be treated as dilutive if their conversion to ordinary
shares would decrease earnings per share or increase loss per share from continuing operations. As the
Group is currently loss-making, an increase in the average number of shares would have anti-dilutive
effects. Diluted and basic (undiluted) earnings per share is therefore the same.
EARNINGS PER SHARE 2022 2021
Profit (loss) for the year (NOK 1000) (167 792) (164 722)
Average number of outstanding shares during the year (1 000) 34 247 32 373
EPS - basic and diluted (NOK per share) (4.9) (5.1)
A share option program was introduced in June 2019 and at the ordinary General Assembly held on 15
April 2022, the Board was authorized until the next ordinary General Assembly in 2023 to increase the
Company’s share capital in connection with the share incentive arrangement by up to NOK 342,217.61. A
total of 2,138,885 share options are outstanding as per 31 December 2022, corresponding to 6.22% of the
outstanding number of shares in the Company.
Please see note 15 for more information regarding the option program.
Chapters
1
5
2
3
4
75 ULTIMOVACS2022
Financial statements
Note 9: Non-current assets
NON-CURRENT ASSETS 2021 (NOK 1 000)
OFFICE AND
LAB EQUIPM.
PATENTS LICENSES GOODWILL TOTAL
Accumulated cost 1 Jan 2021 2 063 9 000 50 401 10 383 71 847
Additions 85 - -
-
85
Cost at 31 Dec 2021 2 148 9 000 50 401 10 383 71 932
Accumulated depreciation and amortization
at 1 Jan 2021
(1 686) (1 707)
- -
(3 393)
Depreciations in the year (250) (754)
- -
(1 004)
Accumulated depreciation and amortization
at 31 Dec 2021
(1 936) (2 461) -
-
(4 397)
Accumulated currency effects at 1 Jan 2021
- -
6 857 1 413 8 270
Currency exchange effects in the year
- -
(3 709) (764) (4 473
Carrying value at 31 Dec 2021 212 6 539 53 549 11 031 71 331
Economic life 3 years 15 years indefinite indefinite
Depreciation method linear linear
Patents
In 2015, the Group acquired all rights to the patents and technology from Inven2 AS, which is one of the
Group’s main shareholders. The price for the patent was MNOK 4.0 and was based on a purchase option
in the license agreement entered into with Inven2 AS in 2011. The purchase of these rights implies that
the Group no longer has to pay future royalties to Inven2 AS from potential commercial sales of products
related to the patents/patent applications. The patent period spans over 15 years and expires in 2031.
According to the purchase agreement related to the same patents, Inven2 AS is entitled to two milestone
payments of MNOK 5.0 and MNOK 6.0 at the commencement of a clinical phase IIb and phase III study (or
another registration study) respectively. The first milestone payment of MNOK 5.0 was paid to Inven2 in May
2020 due to the commencement of the INITIUM phase II trial. The milestone payment was capitalized in
the balance sheet when it was paid to Inven2, and will be depreciated linearly until February 2031.
Licenses and Goodwill
Beyond UV1, which is the core product of the Ultimovacs group, Ultimovacs is pursuing development of a
first-in-class vaccine solution utilizing the proprietary Tetanus-Epitope Targeting-platform (TET-platform).
A preclinical program was initiated in 2019 to take the pharmaceutical product candidate to a decision
point for further clinical development, given that the results from the preclinical program are positive.
NON-CURRENT ASSETS 2022 (NOK 1 000)
OFFICE AND
LAB EQUIPM.
PATENTS LICENSES GOODWILL TOTAL
Accumulated cost 1 Jan 2022 2 148 9 000 50 401 10 383 71 932
Additions 195 - -
-
195
Cost at 31 Dec 2022 2 344 9 000 50 401 10 383 72 127
Accumulated depreciation and amortization
at 1 Jan 2022
(1 936) (2 461)
- -
(4 397)
Depreciations in the year (188) (754)
- -
(943)
Accumulated depreciation and amortization
at 31 Dec 2022
(2 124) (3 215) -
-
(5 339)
Accumulated currency effects at 1 Jan 2022
- -
3 148 649 3 797
Currency exchange effects in the year
- -
(1 605) (331) (1 935)
Carrying value at 31 Dec 2022 220 5 784 51 944 10 701 68 649
Chapters
1
5
2
3
4
76 ULTIMOVACS2022
Financial statements
Note 9: Non-current assets (continued)
Licenses and Goodwill (continued)
There have been and there are several significant milestones in terms of impairment testing of the value of
the TET technology. The current preclinical development of TET is planned to be funded until an expected
milestone in 2023. If Ultimovacs decides not to go further in the development of the TET technology, it
would be difficult to justify the value in the balance-sheet, and a substantial part of the booked value is
subject for impairment.
Impairment of assets
1. IAS 36 seeks to ensure that an entity’s assets are not carried at more than their recoverable amount.
2. Impairment means that asset has suffered a loss in value.
3. An asset is said to be impaired when its recoverable amount is less than its carrying amount.
Ultimovacs has both goodwill and intangibles with indefinite useful lives as of 31 December 2022. Under
IAS 36, ‘Impairment of assets’, these assets are required to be tested annually for impairment irrespective
of indictors of impairment. The intangible assets subject to impairment in the balance sheet are “Licenses”,
which are the basis for the TET technology. The license agreement with Academisch Ziekenhuis Leiden and
Technologiestichting STW gives Ultimovacs rights to commercial development, manufacture and sales of
immunotherapy treatments against cancer utilizing the TET technology. The license agreement does not
have any expiration date, and the license is therefore defined to have indefinite useful life.
The Group also has goodwill created by deferred tax, which is a result of the purchase price amount
for acquiring the licensed technology. The Goodwill is also tested for impairment annually. To test for
impairment, goodwill must be allocated to each of the acquirer’s cash-generating units (CGU), or groups
of cash-generating units, that are expected to benefit from the synergies of the combination, irrespective
of whether other assets or liabilities of the acquiree are assigned to those units or groups of units. The
legal entities Ultimovacs ASA and Ultimovacs AB, together the Group, is defined as the CGU subject for
impairment testing. The impairment testing of the Licenses and its corresponding goodwill will therefore
be performed at Group level.
Impairment test
In order to identify the Recoverable amount of the intangible assets, a value must be found for both Value
in use and Fair value. The Value in use of an asset is the expected future cash flows that the asset in its
current condition will produce, discounted to present value using an appropriate discount rate. Ultimovacs
has chosen not to prepare a Value in use calculation from the TET technology as the estimates of future
cash flows would be highly unreliable. Potential earnings are years ahead, and it would not be clear if these
could come from direct sales, indirect sales or through licensing agreements. To prepare a forecast in order
to obtain any value for the assets tested for impairments would not be reasonable and supportable.
Ultimovacs will therefore rely on the value from the Fair Value assessment, which normally is the market
value at measurement date. No active market exists for comparison; thus, the acquisition price, and book
value, is considered as the fair value. The fair value, however, must be tested for factors which may reduce
is value, function etc.
The following factors have been assessed when testing for impairment:
1. Market value declines: There is no indication that the value for adjuvants is in decline. Ultimovacs has
few or no real alternatives to the adjuvant currently being used, GM-CSF.
2. Negative changes in technology, markets, economy, or laws: There is still an unmet need for more
adjuvant solutions to be used with vaccines. Thus, the TET technology may potentially be utilized in other
vaccine candidates, and it could also be sold to third parties. No other negative factors are observed in
the markets.
Chapters
1
5
2
3
4
77 ULTIMOVACS2022
Financial statements
Note 9: Non-current assets (continued)
3. Asset is idle, part of a restructuring or held for disposal: The first phase of the development plan
is to develop product candidates of the TET prototype and identify 1-2 clinical trial lead candidate(s).
Approximately MNOK 37 has been spent from 2019 until December 2022 on preclinical development, the
TENDU phase I clinical trial, production and consultant costs in order to create and validate the TET
technology platform and to develop one or more product candidates. Several employees in both Norway
and Sweden are involved in the project. In October 2021, the Company raised gross MNOK 270 in equity in
a private placement, where a certain amount was allocated to further TET-development.
4. Worse economic performance than expected: Even though TET is still far from bringing any cash inflows
to the company, the technology will be highly valuable if the project is successful. Setting any value on
the TET technology using a CF model is of no real value/use at this very early stage of its research and
development.
In addition, Management has undertaken a review of the company’s business and the environment in which
it operates, and concludes that there are no significant changes in the business or its environment now or
in the future regarding:
• a decline in the market or price for products or services
• oversupply in markets for products or services
• problems in sourcing raw materials or services
• increases in the costs of production or delivering services
• changes in exchange rates affecting costs or sales
• new competitors
• new products or services from competitors
• technological change
• changes in law or regulations
• changes in economic conditions
An additional factor which could be an indicator for impairment of the non intangible assets would be if
the total market capitalization of the Group was lower than the net asset value in the balance sheet. This
does however, not necessarily mean that the asset is overvalued in the statement of financial position, but
should be a trigger to test for impairment based on other parameters. Market capitalization for the Group
was as per 31 December 2022, MNOK 3,784, significantly higher than the value of the assets being tested
for impairment (MNOK 449.4). On the other hand, a market capitalization over the current book value,
does not directly indicate that the value is present and no other testing is required, as most of the market
value is primarily attributable to UV1. Market capitalization alone cannot therefore be the sole parameter
for testing the asset for impairment, but should additionally be assessed based on the factors discussed
above. Based on the market capitalization as per 31 December 2022, there is no indication that the market
values TET lower than the current book value.
Although the list above is not exhaustive, we do not observe any new risk factors related to the technology
which may reduce the value of the assets in the balance sheet.
The preclinical development of TET is planned to be funded until an expected milestone in 2023. Then,
if certain milestones are reached, additional funding will be needed for the next phase (mainly CMC
development/manufacturing processes and clinical development) towards the commencement of a clinical
trial. This critical decision point will be important when considering impairment of the intangible assets, as
the asset could then be considered partly idle, reducing its value significantly.
Conclusion
In the impairment test performed, no indications of impairment were identified, which concludes that
the fair value of the intangible assets are higher than carrying value. As a result, no impairment of these
intangible assets has been recognized.
Chapters
1
5
2
3
4
78 ULTIMOVACS2022
Financial statements
Note 10: Other receivables
OTHER RECEIVABLES (NOK 1 000) 2022 2021
Government grants receivables (ref note 3) 4 990 5 314
Prepayments 2 916 878
Fair value of currency contracts 1 083 759
Other receivables 1 280 1 135
Total other receivables 10 270 8 087
As of 31 December 2022, cash and cash equivalents amounted to MNOK 425.3, of which MNOK 19.7
(MEUR 1.9) on an EUR account and MNOK 4.9 (MSEK 5.2) in Ultimovacs AB on a Swedish bank account in
SEK.
CHANGES TO SHARE CAPITAL
SHARE CAPITAL
NUMBER OF SHARES
SHARE CAPITAL
(NOK 1 000)
31 December 2020 31 973 511 3 197 351.1
Issuance of ordinary shares 2 248 250 224 825.0
31 December 2021 34 221 761 3 422 176.1
Issuance of ordinary shares 174 700 17 470
31 December 2022 34 396 461 3 439 646.1
Note 11: Cash and cash equivalents
CASH AND CASH EQUIVALENTS (NOK 1 000) 2022 2021
Employee withholding tax 1 818 1 855
Cash at bank 423 491 572 313
Cash and cash equivalents 425 309 574 168
Note 12: Share capital, shareholder information and dividend
In September and November 2022, a total of 174,700 options, granted under Ultimovacs’ option program,
were exercised. Subsequently, the Company’s share capital was increased by NOK 17,470 by issuing 174,700
new shares, each share of par value NOK 0.10.
In a private placement in October 2021, 2,160,000 new shares each with a par value of NOK 0.10 and issued
at a subscription price per share of NOK 125.0, resulting in gross proceeds from the share issue of MNOK
270. The transaction costs related to the share-issues amounted to MNOK 11.0 in 2021, and have been
recognized against share premium. For computation of earnings per share and diluted earnings per share
see Note 8.
In March and October 2021, a total of 88,250 options, granted under Ultimovacs’ option program, were
exercised. Subsequently, the Company’s share capital was increased by NOK 8,825 by issuing 88,250 new
shares, each share of par value NOK 0.10.
The share capital as of 31 December 2022 was NOK 3,439,646.1, with 34,396,461 ordinary shares with a
nominal value of NOK 0.1. All issued shares have equal voting rights and the right to receive dividend.
No dividend has been paid in the period. Ultimovacs ASA has approximately 5,000 shareholders as of 31
December 2022, with the 20 largest shareholders as of this date listed in a table below on the next page.
The movement in the number of registered shares and share capital was in 2021 and 2022 as follows:
Chapters
1
5
2
3
4
79 ULTIMOVACS2022
Financial statements
Note 12: Share capital, shareholder information and dividend (continued)
THE 20 MAIN SHAREHOLDERS AS OF 31 DECEMBER 2022
NUMBER OF
SHARES
OWNERSHIP
INTEREST
Gjelsten Holding AS 6 495 866 18.9 %
Canica AS 2 705 957 7.9 %
Watrium AS 1 780 575 5.2 %
Inven2 AS 1 555 492 4.5 %
Folketrygdfondet 1 515 813 4.4 %
Radforsk Investeringsstiftelse 1 512 163 4.4 %
Langøya Invest AS 1 389 006 4.0 %
Helene Sundt AS 965 802 2.8 %
CGS Holding AS 882 132 2.6 %
Sundt AS 803 321 2.3 %
Danske Invest Norge Vekst 736 440 2.1 %
Stavanger Forvaltning AS 590 000 1.7 %
Prieta AS 533 988 1.6 %
Verdipapirfondet Nordea Avkastning 480 573 1.4 %
SEB Prime Solutions Sissener Canopus 400 000 1.2 %
Verdipapirfondet KLP Aksjenorge 348 416 1.0 %
Swedbank AB 252 814 0.7 %
Wiarom AS 250 000 0.7 %
Verdipapirfondet Nordea Kapital 246 178 0.7 %
Gade, Leif Johan 225 052 0.7 %
20 Largest shareholders 23 669 588 68.8%
Other shareholders 10 726 873 31.2%
Total
34 396 461
100.0%
As of 31 December 2022, four members of the Management team in the Group held a total of 163,066
ordinary shares in Ultimovacs.
NUMBER OF SHARES HELD BY CEO AND THE BOARD OF DIRECTORS
AS OF 31 DECEMBER 2022
POSITION
NUMBER OF
SHARES
Carlos de Sousa CEO 14 906
Ketil Fjerdingen - through Langøya Invest AS Board member 1 389 006
Leiv Askvig - through Basen Kapital AS Board member 91 500
Henrik Schussler - through Fireh AS Board member 30 900
Eva S. Dugstad Board member 6 400
Kari Grønås - through K OG K AS Board member 6 640
Total shares held by CEO and Board of Directors 1 539 352
Chapters
1
5
2
3
4
80 ULTIMOVACS2022
Financial statements
Note 12: Share capital, shareholder information and dividend (continued)
As of 31 December 2021, three members of the Management team in the Group held a total of 156,606
ordinary shares in Ultimovacs.
NUMBER OF SHARES HELD BY CEO AND THE BOARD OF DIRECTORS
AS OF 31 DECEMBER 2021
POSITION
NUMBER OF
SHARES
Carlos de Sousa CEO 11 906
Ketil Fjerdingen - through Langøya Invest AS Board member 1 389 006
Leiv Askvig - through Basen Kapital AS Board member 91 500
Henrik Schussler - through Fireh AS Board member 30 900
Eva S. Dugstad Board member 6 400
Kari Grønås - through K OG K AS Board member 6 640
Håkan Englund - through JDS Invest AB Deputy Board member 73 650
Total shares held by CEO and Board of Directors 1 610 002
THE 20 MAIN SHAREHOLDERS AS OF 31 DECEMBER 2021
NUMBER OF
SHARES
OWNERSHIP
INTEREST
Gjelsten Holding AS
6 495 866
19.0 %
Canica AS
2 705 957
7.9 %
Watrium AS 1 780 575 5.2 %
Inven2 AS 1 555 492 4.5 %
Radforsk Investeringsstiftelse 1 506 913 4.4 %
Folketrygdfondet 1 400 000 4.1 %
Langøya Invest AS 1 389 006 4.1 %
Helene Sundt AS 965 802 2.8 %
CGS Holding AS 882 132 2.6 %
Sundt AS 803 321 2.3 %
Danske Invest Norge Vekst 736 440 2.2 %
Stavanger Forvaltning AS 596 999 1.7 %
Prieta AS 533 988 1.6 %
Verdipapirfondet Nordea Avkastning 483 573 1.4 %
JPMorgan Chase Bank, N.A., London 402 495 1.2 %
Verdipapirfondet KLP AksjeNorge 348 416 1.0 %
SEB Prime Solutions Sissener Canopus 324 000 0.9 %
Verdipapirfondet Nordea Kapital 282 549 0.8 %
Avanza Bank AB (Nominee) 274 520 0.8 %
Swedbank AB 258 629 0.8 %
20 Largest shareholders 23 726 673 69.3%
Other shareholders 10 495 088 30.7%
Total
34 221 761
100.0%
Chapters
1
5
2
3
4
81 ULTIMOVACS2022
Financial statements
Note 13: Transactions with related parties
In 2015, Ultimovacs acquired the patent rights for the core UV1 technology from Inven2 AS, a major
shareholder in the Group. Based on the agreements, Invent2 AS is entitled to receive two potential
milestone payments when certain clinical research criteria are reached; MNOK 5.0 and MNOK 6.0 at the
commencement of a clinical phase IIb and phase III study (or another registration study) respectively. The
first milestone payment of MNOK 5.0 was paid to Inven2 in May 2020 due to the commencement of the
INITIUM phase II trial.
Please refer to note 9 for additional information.
As part of ordinary business and at market price, Ultimovacs purchases services related to clinical trials and
laboratory services from Oslo University Hospital through Inven2 AS. Invoicing directly from or administered
by Inven2 AS amounted to MNOK 4.3 in 2021 and MNOK 2.9 in 2022 respectively (incl. VAT). As per 31
December 2022, Ultimovacs had no outstanding payables to Inven2 AS.
Ultimovacs ASA partly finances running operations and projects in its Swedish subsidiary Ultimovacs AB
through unconditional shareholder contributions. In 2021, Ultimovacs ASA contributed with a total of MNOK
12.0 in unconditional shareholder contributions to Ultimovacs AB, and MNOK 8.0 in 2022.
As of 2022, Ultimovacs ASA and Ultimovacs AB have entered into an intercompany agreement where
Ultimovacs AB will provide R&D services for Ultimovacs ASA, and thus invoice Ultimovacs ASA for these
services. Direct and indirect costs pertaining to Ultimovacs AB’s employees’ performance of the services
as well as other direct costs are invoiced using a ‘cost plus’ model. In 2022, MNOK 9.9 was invoiced from
Ultimovacs AB to Ultimovacs ASA.
Chapters
1
5
2
3
4
82 ULTIMOVACS2022
Financial statements
Note 14: Leases and commitments
The right-of-use assets comprise a rental agreement for office premises in Oslo with 3 years left of the
rental contract as of 31 December 2022, and four car-leasing contracts. The weighted average discount rate
applied is 8.3% as per 31 December 2022.
The Group has utilized the practical expedients relating to leases where short term leases and lease-
contracts of low value have not been recognized as right of use assets. Expenses relating to short-term
lease comprise lab premises and parking spaces in Oslo, Norway, and office- and lab premises in Uppsala,
Sweden. These contracts can be terminated by both lessee and lessor within 1 - 3 months.Expense relating
to low-value assets comprise leasing of an office printer in Oslo.
The Group had total cash outflows related to leases of MNOK 2.6 in FY21 and MNOK 2.8 in FY22.
LEASE EXPENSES (NOK 1 000) 2022 2021
Depreciation expense of right-of-use assets 1 705 1 698
Interest expense on lease liabilities 105 179
Expense relating to short-term leases (incl. in Other operating expenses) 1 018 743
Expense relating to low-value assets (incl. in Other operating expenses) 11 11
Total amount recognized in profit or loss 2 839 2 632
NON-DISCOUNTED LEASE LIABILITIES EXPIRING WITHIN THE FOLLOWING PERIODS
FROM THE BALANCE SHEET DATE (NOK 1 000)
2022 2021
Within 1 year 2 147 1 708
1 to 2 years 2 058 285
2 to 3 years 1 862 196
3 to 4 years 112 -
4 to 5 years - -
Over 5 years - -
Sum 6 179 2 190
LEASE LIABILITIES (NOK 1 000) 2022 2021
Lease liability as per 1 January
2 084 3 782
Additions
5 199 19
Cash payments for the principal portion of the lease liability
(1 802) (1 716)
Cash payments for the interest portion of the lease liability
(105) (179)
Interest expense on lease liabilities
105 179
Lease liability as per 31 December
5 481 2 084
Current
1 767 1 628
Non-current
3 713 457
RIGHT-OF-USE ASSETS 2022 (NOK 1 000) CARS OFFICE TOTAL
Right-of-use assets as per 1 January 2022 680 1 270 1 951
Depreciation costs during the year (365) (1 340) (1 705)
Extension options exercised / additions 955 4 244 5 199
Balance sheet value as per 31 December 2022 1 270 4 174 5 444
RIGHT-OF-USE ASSETS 2021 (NOK 1 000) CARS OFFICE TOTAL
Right-of-use assets as per 1 January 2021 1 109 2 520 3 630
Depreciation costs during the year (429) (1 269) (1 698)
Extension options exercised / additions - 19 19
Balance sheet value as per 31 December 2021 680 1 270 1 951
Chapters
1
5
2
3
4
83 ULTIMOVACS2022
Financial statements
Note 15: Share based payment
Share option program
The share option program was introduced in June 2019. The share option program is groupwide and
includes all employees in the Group. At the Annual General Meeting held on 21 April 2022, the Board was
authorized to increase the Company’s share capital in connection with the share incentive arrangement by
up to NOK 342,217.61. The authorization is valid until the next ordinary General Meeting in 2023.
Each option gives the right to acquire one share in the Company and is granted without consideration.
Pursuant to the vesting schedule, 25% of the options will vest one year after the day of grant, 25% of the
options will vest two years after the day of grant and the remaining 50% will vest three years after the day
of grant.
The options granted in 2020 to the CEO, Carlos de Sousa, will vest with 33.33% one year following the grant
date, 33.33% after two years, and the remaining 33.34% on the third anniversary following the grant date.
Vesting is dependent on the option holder still being employed in the Company.
The exercise price for all options granted in 2019 was NOK 31.25, NOK 39.15 for the options granted in 2020,
NOK 61.99 for the options granted in 2021 and NOK 83.46 for the options granted in 2022.
Options that are not exercised within 7 years from the date of grant will lapse and become void. In 2022,
the Board of Directors decided to extend the duration of all options under the share option program from
5 years to 7 years. Due to this life extension, the unamortized value of the options increased, resulting in
an increased IFRS cost related to the options going forward, as well as a one-off cost of MNOK 4.5 booked
in Q2 2022 in accordance with IFRS 2.
After the distribution of 480,000 new options on 21 April 2022 and the exercise of 174,700 shares during
2022, a total of 2,138,885 share options are granted per 31 December 2022, corresponding to 6.22% of the
outstanding number of shares in the Company.
OUTSTANDING INSTRUMENTS OVERVIEW AT YEAR END 2022 2021
Number of instruments 2 138 885 1 833 585
Weighted Average Exercise Price (NOK) 54.55 44.77
Vested/Exercisable instruments as of 31 December 40.76 35.42
Weighted Average Exercise Price on vested instruments (NOK) 860 454 419 328
Weighted Average remaining contractual life (years) 4.96 3.46
MOVEMENTS OF OPTIONS DURING 2022
NUMBER OF
INSTRUMENTS
WEIGHTED AVERAGE
EXERCISE PRICE
Outstanding at 1 January 1 833 585 44.77
Granted during the year 480 000 83.46
Terminated during the year - -
Exercised during the year (174 700) 31.39
Expired during the year - -
Outstanding at 31 December 2 138 885 54.55
Vested options during the year 441 126 45.85
MOVEMENTS OF OPTIONS DURING 2021
NUMBER OF
INSTRUMENTS
WEIGHTED AVERAGE
EXERCISE PRICE
Outstanding at 1 January 1 330 435 36.16
Granted during the year 600 000 61.99
Terminated during the year (8 600) 39.15
Exercised during the year (88 250) 32.46
Expired during the year - -
Outstanding at 31 December 1 833 585 44.77
Vested options during the year 279 953 37.49
Chapters
1
5
2
3
4
84 ULTIMOVACS2022
Financial statements
Note 15: Share based payment (continued)
Assumptions, costs and social security provisions:
The Ultimovacs Employee Share Options’ fair value is calculated according to the IFRS-2 regulations.
As stated in IFRS-2 Appendix B §B5 the Black-Scholes-Merton Option Pricing Model (“B&S Model”) may
be used to estimate the fair value of employee share options, which is therefore used to estimate the
fair value of the Ultimovacs Employee Share Options. The model uses the following parameters; the
exercise price, the current price of the underlying shares, the life of the option, the expected volatility of
the share price, the dividends expected on the shares, and the risk-free interest rate for the life of the
option.
The exercise price is set out in the Ultimovacs Award Agreements with each employee and is stated in
the Norwegian Krone. The current price of the underlying shares used in the model is the last available
closing price of Ultimovacs at grant date.
The risk-free interest rate used in the B&S Model is equal to the rates of the government bond issues of
the country in whose currency the exercise price is expressed, with the term equal to the expected term
of the option being valued. Since the exercise price is expressed in Norwegian Krone, the “Norges Bank
Statskasseveksler” and “Obligasjoner”-rate is used as input. The interest rates used for the options with
term structures outside of the quoted terms of Norges Banks interest rates are calculated with the use
of a linear interpolation between the two closest quoted rates.
A dividend parameter is not included in the calculations.
The B&S Model assumes that the time from grant until expiry gives the time parameter in the
model. This assumption is based on the options being free from restraints and that the owner of
the options holds the right to sell the option in the market at any time. As this is not the case for
most employee share options, IFRS-2 Appendix B §B16-18, states that a shorter time period can be
used as the expected lifetime of the options in some cases. Half a year after vesting date is therefore
assumed to be the estimated end-of-lifetime of each option in the model. However, exercise
patterns will be monitored, and expected option lifetime will be updated if needed for future grants.
As Ultimovacs has not been listed on a stock exchange long enough to have a sufficient share price history
to calculate the shares’ volatility, comparable firms’ share price volatility have been used to estimate the
expected volatility.
The fair value of the granted instruments in 2021 and 2022 have been calculated using a Black Scholes
model with the following assumptions:
FAIR VALUE PRICING ASSUMPTIONS 2022 2021
Instrument Option Option
Quantity as of 31 December 480 000 600 000
Contractual life* 7.00 7.00
Exercise price* 83.46 61.99
Share price* 81.60 62.10
Expected lifetime* 3.25 3.25
Volatility* 59.60% 48.12%
Interest rate* 2.2451% 0.067%
Dividend* - -
Fair value per instrument* 34.46 20.79
Vesting conditions Service condition
*Weighted average parameters at grant of instrument
The total IFRS cost recognized for the option program was MNOK 11.6 in FY 2021 and MNOK 20.4 in FY22.
The total social security provision was MNOK 8.6 in FY21 and MNOK 2.0 in FY22.
Chapters
1
5
2
3
4
85 ULTIMOVACS2022
Financial statements
Note 15: Share based payment (continued)
Note 16 - Other current liabilities
OTHER CURRENT LIABILITIES (NOK 1 000) 2022 2021
Public duties payable 3 698 3 386
Public duties payable related to options 14 904 12 888
Holiday pay payable 3 913 3 415
Other accrued expenses 13 970 7 025
Sum 36 485 26 714
NUMBER OF OPTIONS HELD BY MANAGEMENT TEAM POSITION 2022 2021
Carlos de Sousa Chief Executive Officer 416 035 416 035
Hans Vassgård Eid Chief Financial Officer 224 500 177 500
Jens Egil Torbjørn Bjørheim Chief Medical Officer 215 000 168 000
Audun Tornes Chief Technology Officer 137 500 107 500
Gudrun Trøite Head of Project Coordination 96 814 107 500
Ingunn Hagen Westgaard Head of Research 111 395 107 500
Øivind Foss Head of Clinical Operations 104 500 107 500
Ton Berkien Chief Business Officer 106 000 59 000
Anne Worsøe Head of IR and Communication 22 500 -
Orla Mc Callion Head of Regulatory Affairs and QA 38 000 -
Total allocated share options to Management Team 1 472 244 1 250 535
Note 17: Financial instruments
Foreign exchange forward contracts are valued at fair value which is also the market value of the contract
based on the use of market observable inputs at Level 2 of the fair value hierarchy (please refer to ‘Note
2: Accounting principles - iii. Financial instruments’ for information regarding the ‘fair value hierarchy’).
Market values are calculated using mid-rates (excluding margins) as determined by the financial institution
counterparty on available market rates at reporting date.
Foreign exchange derivatives not designated as hedging instruments reflect the positive change in fair
value of those foreign exchange forward contracts that are not designated in hedge relationships, but are,
nevertheless, intended to reduce the level of foreign currency risk for expected purchases.
2022 2022 2021 2021
FINANCIAL ASSETS (NOK 1 000)
CARRYING
VALUE
FAIR VALUE
CARRYING
VALUE
FAIR VALUE
Foreign exchange forward contracts 1 083 1 083 759 759
Total financial assets 1 083 1 083 759 759
Chapters
1
5
2
3
4
86 ULTIMOVACS2022
Financial statements
Note 17: Financial instruments (continued)
Financial risks
The most significant financial risks for the Group are liquidity risk, credit risk and foreign currency risk.
Management continuously evaluates these risks and determines policies related to how these risks are
to be handled within the Group.
Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument of
customer contract, leading to a financial loss. The Group is exposed to credit risk from its receivables,
deposits in banks.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall
due. The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have
sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without
incurring unacceptable losses or risking damage to the Group’s reputation.
Interest rate risk
The Group has no interest-bearing debt. Bank deposits are exposed to market fluctuations in interest
rates, which impact the financial income.
Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate
because of changes in foreign exchange rates. The Group’s exposure to the risk of changes in foreign
exchange-rates relates to the Group’s operating activities, primarily expenses in USD, EUR, SEK and GBP.
During 2022 the Company has held funds in EUR and entered into EUR swaps to mitigate the foreign
exchange risk and to get a better predictability regarding future costs. The fair value of forward exchange
contracts are determined using the forward exchange rate at the end of the reporting period, with
changes in the value recognized in the income statement. In the income statement, impacts from the
derivatives are presented as loss/gains in the financial items.
The Group does not use financial instruments, including financial derivatives, for trading purposes.
The table below shows a simulation of sensitivity to a 10% increase/decrease in EUR, GBP, USD and SEK
against NOK and the effect on Profit (loss) before tax:
FOREIGN CURRENCY SENSITIVITY (NOK 1 000) CHANGE IN FOREIGN CURRENCY 2022 2021
EUR
+10%
25 215 26 533
-10% (25 215) (26 533)
GBP
+10% 629 455
-10% (629) (455)
USD
+10% 1 334 821
-10% (1 334) (821)
SEK
+10% 1 764 2 646
-10% (1 764) (2 646)
Note that the majority of the simulated EUR sensitivity effects are related to EUR at bank and the
forward exchange contracts which effects Profit (loss) before tax when EUR/NOK fluctuates.
Chapters
1
5
2
3
4
87 ULTIMOVACS2022
Financial statements
Note 17: Financial instruments (continued)
Fair value
The Management assessed that the fair values of cash and cash equivalents, accounts receivable,
accounts payable and other current liabilities approximate their carrying amounts largely due to the
short-term maturities of these instruments.
Capital management
The Group manages its capital to ensure that Group will be able to continue as a going concern while
maximizing the return to stakeholders through the optimization of the debt and equity balance. The Group’s
policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and
to support future development of the business. The Group is currently sufficiently capitalized as per 31
December 2022. Management closely monitors the Group’s cash flows short-term and long-term and
continuously assesses the need for additional funding.
The capital structure of the Group consists of equity attributable to owners of the Group, comprising
share capital, share premium and accumulated losses.
The Group is not subject to any externally imposed capital requirements.
Note 18: Events after the balance sheet date
On 23 January 2023, Ultimovacs announced that patient enrollment was completed in the NIPU Phase II
clinical trial in metastatic pleural mesothelioma.
In February 2023, as part of the Q4 2022 reporting, Ultimovacs provided an update on guidance regarding
topline data readouts for its Phase II clinical trials:
• INITIUM (malignant melanoma): H1 2023 (no change from previous statements)
• NIPU (pleural mesothelioma): H1 2023 (no change from previous statements)
• FOCUS (head and neck cancer): H1 2024
• DOVACC (ovarian cancer): H2 2024
• LUNGVAC (non-small cell lung cancer): H2 2025
There are no other significant subsequent events after the balance sheet date.
INTEREST RATE SENSITIVITY (NOK 1 000) CHANGE IN INTEREST RATE 2022 2021
Bank deposits
+2% 9 717 8 331
-2% (9 717) (8 331)
+5% 24 293 20 828
-5% (24 293) (20 828)
Currency fluctuations in regards to the bank deposits in foreign currency and the foreign exchange
forward contracts will not result in any ‘other comprehensive income’ (OCI) effects.
Chapters
1
5
2
3
4
88 ULTIMOVACS2022
05
Financial Statements
- Ultimovacs ASA
Financial Statements
Notes
Auditor’s Report
Chapters
5
2
3
4
1
89 ULTIMOVACS2022
Contents - Financial Statements Ultimovacs ASA
Statement of profit and loss and other comprehensive income Ultimovacs ASA
Statement of financial position Ultimovacs ASA
Statement of cash flow Ultimovacs ASA
Statement of changes in equity Ultimovacs ASA
Note 1: General information
Note 2: Accounting principles
Note 3: Government grants
Note 4: Salary and personnel expenses and management remuneration
Note 5: Other operating expenses
Note 6: Financial items
Note 7: Income tax
Note 8: Earnings per share
Note 9: Non-current assets
Note 10: Other receivables
Note 11: Cash and cash equivalents
Note 12: Share capital, shareholder information and dividend
Note 13: Transactions with related parties
Note 14: Leases and commitments
Note 15: Share based payment
Note 16: Other current liabilities
Note 17: Financial instruments
Note 18: Investment in subsidiary
Note 19: Events after the balance sheet date
90
91
92
93
94
94
100
101
103
103
104
105
106
107
107
107
110
111
112
114
114
116
117
Chapters
5
2
3
4
1
90 ULTIMOVACS2022
Financial statements
Statement of profit and loss and other comprehensive income Ultimovacs ASA
(NOK 1 000) EXCEPT PER SHARE DATA NOTES 2022 2021
Total revenues - -
Payroll and payroll related expenses
3, 4, 15
(60 132) (52 959)
Depreciation and amortization
9, 14
(2 648) (2 703)
Other operating expenses
3, 5
(114 182) (94 602)
Total operating expenses (176 962 ) (150 264)
Operating profit (loss) (176 962) (150 264)
Financial income
6
17 365 13 383
Financial expenses
6
(1 530) (14 268)
Net financial items 15 836 (885)
Profit (loss) before tax (161 126) (151 149)
Income tax expense
7
- -
Profit (loss) for the year (161 126) (151 149)
Items that subsequently may be reclassified to profit or loss:
Other comprehensive income (loss) for the year - -
Total comprehensive income (loss) for the year (161 126) (151 149)
Basic and diluted earnings (loss) per share (NOK per share)
8
(4.7) (4.7)
Chapters
1
2
3
4
5
91 ULTIMOVACS2022
Financial statements
Statement of financial position Ultimovacs ASA
(NOK 1 000) NOTES 2022 2021
ASSETS
Non-current assets
Investment in subsidiary
13, 18
85 512 77 512
Patents
9
5 784 6 539
Property, plant and equipment
9
220 212
Right of use assets
14
5 444 1 951
Total non-current assets 96 960 86 214
Current assets
Receivables and prepayments
3, 10
9 424 7 539
Cash and cash equivalents
11
420 365 573 255
Total current assets 429 788 580 794
TOTAL ASSETS 526 748 667 008
EQUITY AND LIABILITIES
Equity
Share capital 3 440 3 422
Share premium 1 076 308 1 070 841
Total paid-in equity 1 079 747 1 074 264
Accumulated losses (636 201) (475 074)
Other equity 37 494 19 405
TOTAL EQUITY
12
481 041 618 594
Non-current liabilities
Lease liability
14
3 713 457
Total non-current liabilities 3 713 457
Current liabilities
Lease liability
14
1 767 1 628
Accounts payable 6 545 21 275
Other current liabilities
15, 16
33 681 25 055
Total current liabilities 41 994 47 957
TOTAL LIABILITIES 45 707 48 414
TOTAL EQUITY AND LIABILITIES 526 748 667 008
Board of Directors and CEO of Ultimovacs ASA
Oslo, 23 March 2023
Sign Sign
Sign
Jónas Einarsson Kari Grønås Eva S. Dugstad
Chair of the Board Board member Board member
Sign
Sign
Sign
Henrik Schüssler Ketil Fjerdingen Leiv Askvig
Board member Board member Board member
Sign Sign
Sign
Aitana Peire Haakon Stenrød Carlos de Sousa
Board member Board member CEO
Chapters
1
2
3
4
5
92 ULTIMOVACS2022
Financial statements
Statement of cash flow Ultimovacs ASA
(NOK 1 000) NOTES 2022 2021
Cash flow from operating activities
Profit (loss) before tax (161 126) (151 149)
Adjustments to reconcile profit before tax to net cash flow:
Depreciation and amortization
9, 14
2 648 2 703
Interest received including investing activities
6
(8 887) (3 062)
Net foreign exchange differences
6
(7 182) 3 614
Other financial expenses
14
105 179
Share option expenses
15
18 089 10 896
Working capital adjustment:
Changes in prepayments and other receivables
10
(1 561) 730
Changes in payables and other current liabilities
16
(6 103) 21 495
Net cash flows from operating activities (164 018) (114 593)
Cash flow from investing activities
Purchase of property, plant and equipment
9
(195) (85)
Patent milestone payments
13
- -
Shareholder contribution to subsidiary
18
(8 000) (12 000)
Interest received
6
8 887 3 062
Net cash flow from investing activities 691 (9 023)
Cash flow from financing activities
Proceeds from issuance of equity
12
5 484 272 864
Share issue cost
12
- (11 012)
Interest paid
14
(105) (179)
Payment of lease liability
14
(1 802) (1 716)
Net cash flow from financing activities 3 577 259 957
Net change in cash and cash equivalents
11
(159 749) 136 341
Effect of change in exchange rate
6
6 858 (3 614)
Cash and cash equivalents, beginning of period
11
573 255 440 529
Cash and cash equivalents, end of period 420 365 573 255
Chapters
1
2
3
4
5
93 ULTIMOVACS2022
Financial statements
Statement of changes in equity Ultimovacs ASA
(NOK 1 000) NOTES
SHARE
CAPITAL
SHARE
PREMIUM
TOTAL PAID
IN CAPITAL
ACCU-
MULATED
LOSSES
OTHER
EQUITY
TOTAL
EQUITY
Balance as of 31 December 2020 3 197 809 214 812 411 (323 925) 8 509 496 995
Profit (loss) for the year (151 149) (151 149)
Other comprehensive income (loss) -
Issue of share capital
12
225 272 640 272 864 272 864
Share-issue costs
12
(11 012) (11 012) (11 012)
Recognition of share-based payments
15
10 896 10 896
Balance as of 31 December 2021 3 422 1 070 841 1 074 864 (475 074) 19 405 618 594
Profit (loss) for the year (161 126) (161 126)
Other comprehensive income (loss) -
Issue of share capital
12
17 5 466 5 484 5 484
Share-issue costs
12
-
Recognition of share-based payments
15
18 089 18 089
Balance as of 31 December 2022 3 440 1 076 308 1 079 747 (636 201) 37 494 481 041
Chapters
1
2
3
4
5
94 ULTIMOVACS2022
Financial statements
Note 1: General information
Ultimovacs ASA (the Company or Ultimovacs) is a biotech company developing novel immunotherapies
against cancer. Ultimovacs was established in 2011 and is a public limited liability company listed on the Oslo
Stock Exchange in Norway. The company and its proprietary technology is based on pre-clinical and clinical
research on immunotherapies conducted at the Oslo University Hospital. Ultimovacs is headquartered at
the Oslo Cancer Cluster Innovation Park in Oslo, Norway, and also has an office in Uppsala, Sweden.
Ultimovacs’ lead universal cancer vaccine candidate UV1 leverages the high prevalence of the human
telomerase (hTERT) to be effective across the dynamic stages of the tumor’s growth and its microenvironment.
By directing the immune system to hTERT antigens which is expressed at a high level in 85-90% of human
tumors, UV1 drives CD4 helper T cells to the tumor with the goal of activating an immune system cascade
to increase anti-tumor responses. Ultimovacs’ strategy is to clinically demonstrate UV1’s impact in many
cancer types and in combination with other immunotherapies. The Company will expand its pipeline using its
novel TET-platform, which is a vaccine technology that can generate multiple vaccine candidates designed
to achieve increased T cell responses to a broad range of target antigens. The Company is performing a
broad clinical development program with clinical trials in Europe, Australia and the USA.
The financial statements were approved by the Board of Directors on 23 March 2022.
Note 2: Accounting principles
I. Basis for preparation
The financial statements for the Company have been prepared in accordance with IFRS as adopted by the
EU (IFRS). The financial statements are presented in NOK (Norwegian kroner) which is also the Company’s
functional currency.
The financial statements have been prepared on the historical cost basis, with the exception of derivatives
which are measured at fair value. The preparation of financial statements in conformity with IFRS requires
the use of certain critical accounting estimates. It also requires management to exercise its judgments in
applying the Company’s accounting policies.
II. Going concern
The financial statements for 2022 have been prepared under the going concern assumption.
III. Accounting principles
i. Cash and cash equivalents
Cash and cash equivalents in the statement of financial position comprise cash at banks and on hand and
short-term deposits with maturity of three months or less, which are subject to an insignificant risk of
changes in value.
ii. Cash Flow statement
The statement of cash flows is compiled using the indirect method. The statement of cash flows
distinguishes between cash flows from operating, investing and financing activities. For the purpose of the
cash flow statement, cash and cash equivalents comprise cash on hand, deposits held at call with banks,
other short-term highly liquid investments with original maturities of three months or less, cash pool
balances and bank overdrafts. Cash flows in foreign currencies are translated at the rate of the transaction
date. Interest paid is included under cash flow from financing activities, and interest received is included
in investing activities. Cash flows arising from the acquisition or disposal of financial interests (subsidiaries
and participating interests) are recognized as cash flows from investing activities, taking into account
any cash and cash equivalents in these interests. Dividends paid out are recognized as cash flows from
financing activities; dividends received are recognized as cash flows from investing activities. Cash flows
from share issues are recognized as cash flows from financing activities.
Chapters
1
2
3
4
5
95 ULTIMOVACS2022
Financial statements
Note 2: Accounting principles (continued)
iii. Financial instruments
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit
or loss and other comprehensive income, loans and borrowings, or payables. All financial liabilities are
recognized initially at fair value and, in the case of loans and borrowings and payables, net of directly
attributable transaction costs. The Company’s financial liabilities include trade and other payables.
The Company uses derivative financial instruments to hedge its risks associated with foreign exchange
rates. Derivatives are initially and subsequently measured at fair value. Derivatives are carried as assets
when the fair value is positive and as liabilities when the fair value is negative. The gain/(loss) arising from
changes in fair value of currency derivatives is presented as part of “Financial income/expenses” in the
consolidated statement of comprehensive income.
- Subsequent measurement
The measurement of financial liabilities depends on their classification.
- Loans and borrowings- Loans and borrowings
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortized
cost using the effective interest rate method. Gains and losses are recognized in profit or loss when the
liabilities are derecognized as well as through the effective interest rate amortization process. Amortized
cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are
an integral part of the effective interest rate. The effective interest rate amortization is included as finance
costs in the statement of profit or loss and other comprehensive income.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are
categorized within the fair value hierarchy, described as follows, based on the lowest level input that is
significant to the fair value measurement as a whole:
• Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities
• Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value
measurement is directly or indirectly observable
• Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value
measurement is unobservable
iv. Current vs non-current classification
The Company presents assets and liabilities in the statement of financial position based on current/non-
current classification. An asset is current when it is:
• Expected to be realized or intended to be sold or consumed in the normal operating cycle
• Held primarily for the purpose of trading
• Expected to be realized within twelve months after the reporting period, or
• Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at
least twelve months after the reporting period
All other assets are classified as non-current. A liability is current when:
• It is expected to be settled in the normal operating cycle
• It is held primarily for the purpose of trading
• It is due to be settled within twelve months after the reporting period, or
• There is no unconditional right to defer the settlement of the liability for at least twelve months
after the reporting period
The Company classifies all other liabilities as non-current. Deferred tax assets and liabilities are classified
as non-current assets and liabilities.
Chapters
1
2
3
4
5
96 ULTIMOVACS2022
Financial statements
Note 2: Accounting principles (continued)
v. Foreign currencies
The Company’s financial statements are presented in NOK, which is the Company’s functional currency.
Transactions in foreign currencies are initially recorded by the Company in its respective functional
currency spot rate at the date the transaction first qualifies for recognition. Monetary assets and liabilities
denominated in foreign currencies are translated at the functional currency spot rates of exchange at the
reporting date. Differences arising on settlement or translation of monetary items are recognized in the
statement of profit and loss under financial items.
vi. Impairment
The Company assesses at each reporting date whether there is an indication that an asset may be impaired.
If any indication exists, or when annual impairment testing for an asset is required, the Company estimates
the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or CGU’s (cash-
generating unit) fair value less costs of disposal and its value in use. It is determined for an individual asset,
unless the asset does not generate cash inflows that are largely independent of those from other assets or
groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset
is considered impaired and is written down to its recoverable amount.
vii. Investments in subsidiaries
Investments in subsidiaries, joint ventures and associated companies are carried at cost less accumulated
impairment losses in the Company’s balance sheet. On disposal of investments in subsidiaries, joint
ventures and associated companies, the difference between disposal proceeds and the carrying amounts
of the investments are recognized in profit or loss.
viii. Contingent liabilities
Contingent liabilities are not recognized in the statement of financial position but are reported in the
relevant schedules and notes. They may arise from uncertainty as to the existence of a liability represent a
liability in respect of which the amount cannot be reliably measured. Contingent liabilities are disclosed if
the possibility of an outflow of economic benefit to settle the obligation is more than remote.
ix. Interest income
Interest income is recognized using the effective interest method.
x. Earnings per share
The basic earnings per share are calculated as the ratio of the total profit (loss) for the year divided by the
weighted average number of ordinary shares outstanding. When calculating the diluted earnings per share,
the profit that is attributable to the ordinary shareholders and the weighted average number of ordinary
shares outstanding are adjusted for all the dilution effects relating to share options.
No dilutive effect has been recognized as potential ordinary shares only shall be treated as dilutive if their
conversion to ordinary shares would decrease earnings per share or increase loss per share from continuing
operations. As the Company is currently loss-making, an increase in the average number of shares would
have anti-dilutive effects. As the Company has currently no issuable potential ordinary shares and basic
and diluted earnings per share is the same.
xi. Government grants
Government grants are recognized where there is reasonable assurance that the grant will be received, and
all attached conditions will be complied with. When the grant relates to an expense item, it is recognized
as income on a systematic basis over the periods that the costs, which it is intended to compensate,
are expensed. Government grants have been recognized in the statement of profit or loss and other
comprehensive income as a reduction of personnel- and other operating expenses.
Where the grant relates to an asset, it is recognized as income in equal amounts over the expected
useful life of the related asset. If the Company receives non-monetary grants, the asset and the grant are
recorded gross at nominal amounts and released to profit or loss over the expected useful life of the asset,
based on the pattern of consumption of the benefits of the underlying asset by equal annual installments.
Chapters
1
2
3
4
5
97 ULTIMOVACS2022
Financial statements
Note 2: Accounting principles (continued)
xii. IFRS 16 Leases
Under IFRS 16, the Company recognizes right-of-use assets and lease liabilities for all leases.
Right-of-use assets are measured at an amount equal to the lease liability and are subsequently depreciated
using the straight-line method from the commencement date to the earlier of the end of the useful life of
the right-of-use asset or the end of the lease term.
The estimated useful lives of right-of-use assets are determined on the same basis as those of property
and equipment. In addition, the right-of-use asset is reduced by impairment losses, if any, and adjusted
for certain remeasurements of the lease liability.
The lease liability is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be
readily determined, Ultimovacs’ incremental borrowing rate. The incremental borrowing rate is used as the
discount rate.
When applying the practical expedients in IFRS 16 for lease-contracts with low value or lease terms of
less than 12 months, the lease payments (net of any incentives received from the lessor) are taken to the
statement of profit and loss and other comprehensive income on a straight-line basis over the period of
the lease. When the lease is terminated before the lease period has expired, any payment required to be
made to the lessor by way of penalty is recognized as an expense in the period in which termination takes
place.
xiii. Share-based payments
Employees in the Company receive remuneration in the form of share-based payment transactions, whereby
employees render services as consideration for equity instruments (equity-settled transactions) or granted
share appreciation rights, which can be settled in cash (cash-settled transactions). The determination of
whether the arrangement is cash or equity settled is based on a careful evaluation of the terms of the
agreement and also the Company’s ability to settle in shares and the promise and intent of settlement in
cash.
- Cash-settled transactions:
A liability is recognized for the fair value of cash-settled transactions. The fair value is measured initially
and at each reporting date up to and including the settlement date, with changes in fair value recognized in
payroll and payroll related expenses. The fair value is expensed over the period until the vesting date with
recognition of a corresponding liability. The fair value is determined using a Black Scholes model.
- Equity-settled transactions
The cost of equity-settled transactions is recognized in payroll and other payroll related expenses, together
with a corresponding increase in equity over the period in which the service and, where applicable, the
performance conditions are fulfilled (the vesting period). The cumulative expense recognized for equity-
settled transactions at each reporting date until the vesting date reflects the extent to which the vesting
period has expired and the Company’s best estimate of the number of equity instruments that will ultimately
vest. The expense or credit in the statement of profit or loss and other comprehensive income for a period
represents the movement in cumulative expense recognized as of the beginning and end of that period.
Chapters
1
2
3
4
5
98 ULTIMOVACS2022
Financial statements
Note 2: Accounting principles (continued)
xiv. Intangible assets
Intangible assets are stated at their historical cost and amortized on a straight-line basis over their
expected useful lives, which usually varies from 3 to 10 years and up to 20 years for patents. An adjustment
is made for any impairment. Intangible items acquired in a business combination must be recognized as
assets separately from goodwill if they meet the definition of an asset, are either separable or arise from
contractual or other legal rights, and their fair value can be measured reliably.
All research and development spending is expensed each year in the period in which it is incurred.
Development costs will be capitalized once the “asset” being developed has met requirements of technical
and commercial feasibility to signal that the intangible investment is likely to either be brought to market
or sold. Due to uncertainties regarding award of patents, regulations, ongoing clinical trials etc., the asset
recognition criteria of IAS 38 “Intangible Assets” are not met.
xv. Property, plant and equipment
Property, plant and equipment are recognized at cost less accumulated depreciation and any impairment
losses. Such cost includes the cost of replacing parts of the property, plant and equipment and borrowing
costs for long-term construction projects if the recognition criteria are met. When significant parts of
property, plant and equipment are required to be replaced at intervals, the Company recognizes such parts
as individual assets with specific useful lives and depreciates them accordingly. Likewise, when a major
inspection is performed, its cost is recognized in the carrying amount of the plant and equipment as a
replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognized
in the statement of profit and loss and other comprehensive income as incurred.
xvi. Tax
The income tax expense includes tax payable and changes in deferred tax. Income tax on balances
recognized in other comprehensive income is recognized as other comprehensive income, and tax on
balances related to equity transactions is recognized in equity. The tax payable for the period is calculated
according to the tax rates and regulations ruling at the end of the reporting period.
Deferred tax is calculated on temporary differences between book and tax values of assets and liabilities
and the tax effects of losses to carry forward in the consolidated financial statements at the reporting
date. Deferred tax liabilities and assets are calculated according to the tax rates and regulations ruling at
the end of the reporting period and at nominal amounts. Deferred tax liabilities and assets are recognized
net when the Company has a legal right to net assets and liabilities.
Deferred tax assets are recognized only to the extent that it is probable that future taxable profits will be
available which the loss carry forward or other deductible temporary differences can be utilized. Currently
no deferred tax assets are recognized in the statement of financial position as the utilization is uncertain.
xvii. Segments
The Company is still in a R&D phase, and currently does not generate revenues. For management purposes,
the Company is organized as one business unit and the internal reporting is structured in accordance with
this. All non-current assets are located at the Company’s main office in Oslo, Norway.
Chapters
1
2
3
4
5
99 ULTIMOVACS2022
Financial statements
Note 2: Accounting principles (continued)
IV. Significant estimates and judgements
In order to prepare the financial statements, management and the Board may have to make various judgments
and estimates that can affect the amounts recognized in the financial statements for assets, liabilities
and expenses. Uncertainties about these adjustments and estimates could result in outcomes that require
adjustment to the carrying amount of assets or liabilities affected in future periods. Assumptions and
estimates were based on available information at the time of the preparation of the financial statements.
Existing circumstances and assumptions about future developments, however, may change and such
changes are reflected when they occur.
- Share-based payments
Estimating fair value for share-based payment transactions requires determination of the most appropriate
valuation model, which depends on the terms and conditions of the grant. This estimate also requires
determination of the most appropriate inputs to the valuation model including the expected life of the
share option or appreciation right, volatility and dividend yield and making assumptions about them.
- Taxes
Deferred tax assets are recognized for unused tax losses to the extent that it is probable that taxable
profit will be available against which the losses can be utilized. The Company considers that a deferred tax
asset related to accumulated tax losses cannot be recognized in the statement of financial position until
the product under development has been approved for marketing by the relevant authorities. Significant
management judgement is required to determine the amount, if any, of deferred tax assets that can be
recognized, based upon the likely timing and the level of future taxable profits, together with future tax
planning strategies.
Chapters
1
2
3
4
5
100 ULTIMOVACS2022
Financial statements
GRANTS RECOGNIZED (NOK 1 000) 2022 2021
Skattefunn 4 750 4 750
Eurostars - 786
Industrial Ph.D. grant from The Research Council of Norway (Forskningsrådet) 594 802
Innovation Project grant from The Research Council of Norway (Forskningsrådet) 4 194 5 241
Innovation Norway - 3 000
Total grants 9 538 14 578
COSTS DEDUCTED (NOK 1 000) 2022 2021
Payroll and payroll related expenses 1 822 2 472
Other operating expenses 7 717 12 106
Total costs deducted 9 538 14 578
GRANTS RECEIVABLES (NOK 1 000) 2022 2021
Skattefunn 4 750 4 750
Industrial Ph.D. grant from The Research Council of Norway (Forskningsrådet) 198 267
Innovation Project grant from The Research Council of Norway (Forskningsrådet) 42 296
Total grants receivables 4 990 5 314
Note 3: Government grants
The following government grants have been recognized in the statement of profit and loss:
Skattefunn:
The Skattefunn R&D tax incentive scheme is a government program designed to stimulate research and
development in Norwegian. In FY2022, four Skattefunn-grants were approved, two of which reported in
2022, one will report in 2024 and one in 2025.
Industrial Ph.D. grant from The Research Council of Norway (Forskningsrådet):
The industrial Ph.D. project is a collaboration between Ultimovacs ASA, Oslo University Hospital and the
University of Oslo. The Ph.D. candidate for this project is employed by Ultimovacs. The project aims to
characterize the immunological mechanisms induced by treatment with a peptide-based therapeutic
cancer vaccine. The project ended in and reported in December 2022.
Innovation Project grant from The Research Council of Norway (Forskningsrådet):
Innovation Project for the Industrial Sector is a funding instrument that provides grants to business-led
innovation projects that make extensive use of research and development activities. The FOCUS Phase II
trial has been granted an innovation grant of up to MNOK 16 from the Norwegian Research Council.
Innovation Norway:
Innovation Norway is the Norwegian Government’s most important instrument for innovation and
development of Norwegian enterprises and industry. Innovation Norway has granted Ultimovacs MNOK 10
to support the execution of the Phase II DOVACC study.
All conditions and contingencies attached to the grants recognized in the accounts have been fulfilled.
Grants receivable as per 31 December are detailed as follows:
Government grants have been recognized in the statement of profit and loss and other comprehensive
income as a reduction for the related expenses with the following amounts:
Chapters
1
2
3
4
5
101 ULTIMOVACS2022
Financial statements
Note 4: Salary and personnel expenses and management remuneration
The Company’s Management team consists of the Company’s CEO, CFO and the managers of each
department, totaling ten employees, of which two employees in Ultimovacs AB.
PAYROLL AND PAYROLL RELATED EXPENSES (NOK 1 000) 2022 2021
Salaries and holiday pay 32 773 29 753
Social security tax 7 230 5 000
Social security tax related to options 1 479 7 978
Pension expenses 1 686 1 505
Share-based compensation 18 089 10 896
Other personnel expenses 697 299
Government grants (1 822) (2 472)
Total payroll and payroll related expenses 60 132 52 959
Number of FTEs employed during the financial year 19.0 17.6
Number of FTEs at end of year 20.0 19.0
EXECUTIVE REMUNERATION (NOK 1 000) 2022 2021
Management Team remuneration 31 434 27 044
Board of Director’s remunerations 2 055 1 915
There were no outstanding loans or guarantees made to related parties, the Board of Directors, the
Management Team or any other employees as of 31 December 2021 or as of 31 December 2022.
Please refer to the Remuneration Report 2022 for more information.
Pensions
Ultimovacs ASA is required to have an occupational pension scheme in accordance with the Norwegian
law on required occupational pension (“lov om obligatorisk tjenestepensjon”). The company has a defined
contribution pension scheme which complies with the Act on Mandatory company pensions.
As at 31 December 2022, all twenty of Ultimovacs ASA’s employees were covered by the pension scheme.
Other than the general pension schemes described above, there are no specific pension arrangements
made for any member of the Management team. The Company has no pension or retirement benefits for
its Board Members.
The total pension contributions for all employees recognized as expenses equalled MNOK 1.5 and MNOK
1.7 in 2021 and 2022 respectively.
Chapters
1
2
3
4
5
102 ULTIMOVACS2022
Financial statements
Note 4: Salary and personnel expenses and management remuneration (continued)
Severance pay/pay after termination of employment
Under certain conditions, the CEO is entitled to 12 months’ severance pay. The severance pay period
will be extended to 18 months if the termination of the CEO takes place in connection with a ‘change of
control’ event in the Company.
The company’s CFO is entitled to receive pay after termination of his employment with the Group equal
to 9 months’ base salary in addition to payment of his salary during his 3-month notice period.
There are no similar arrangements for any of the other employees of the Group with respect to
termination of their employment.
Other benefits received
There is no bonus scheme in the Group, however, sign-on-fees and bonus may be applied at the Board’s
discretion.
Statement on the executive employee remuneration policy during the previous financial year
The executive compensation for the fiscal year 2022 has been in accordance with the Remuneration
Guidelines for 2022. Please refer to Remuneration Guidelines 2022 and Remuneration Report 2022,
available on the ultimovacs-website, for more information.
Chapters
1
2
3
4
5
103 ULTIMOVACS2022
Financial statements
OTHER OPERATING EXPENSES (NOK 1 000) 2022 2021
External R&D expenses 95 057 93 426
Clinical studies 64 864 54 760
Manufacturing costs 19 899 21 455
Other R&D expenses 10 293 17 210
Patent related expenses 2 728 3 180
Rent, office and IT 3 743 3 091
Accounting, audit, legal, consulting 15 773 4 820
Other operating expenses 4 597 2 190
Less government grants (7 717) (12 106)
Total operating expenses 114 182 94 602
Note 5: Other operating expenses
SPECIFICATION AUDITOR'S FEE (NOK 1 000) 2022 2021
Statutory audit 404 243
Audit related services 40 61
Tax related services 10 -
Other 3 10
Total auditor’s fee 456 313
VAT is not included in the fees specified above.
Note 6: Financial items
FINANCIAL INCOME (NOK 1 000) 2022 2021
Foreign exchange gains - related to derivatives 5 053 9 042
Foreign exchange gains - related to EUR bank account 2 087 849
Foreign exchange gains - other 1 329 430
Interest income 8 897 3 062
Total financial income 17 365 13 383
FINANCIAL EXPENSES (NOK 1 000) 2022 2021
Foreign exchange losses - related to derivatives - 10 520
Foreign exchange losses - related to EUR bank account - 2 702
Foreign exchange losses - other 1 286 712
Other financial expenses 243 333
Total financial expenses 1 530 14 268
The Company is in a development phase, and the majority of the Company’s costs are related to R&D.
These costs are expensed in the statement of profit and loss and other comprehensive income.
Total expenses related to R&D, including other operating expenses, payroll and payroll related expenses,
less government grants, amounted to MNOK 111.8 in 2021 and MNOK 121.0 in 2022.
Chapters
1
2
3
4
5
104 ULTIMOVACS2022
Financial statements
TAX EXPENSE BASIS (NOK 1 000) 2022 2021
Profit (loss) before tax (161 126) (151 149)
Net non-taxable income (4 760) (4 750)
Other items* 18 089 (116)
Change in temporary differences 1 051 7 248
Basis for tax calculation (146 746) (148 767)
Note 7: Income tax
* The share issue cost of MNOK 11.0 in 2021 was deducted directly from equity and is included in the
basis for tax calculation as the tax-effect is charged directly to equity.
The corporate tax rate in Norway was 22% in 2021 and 2022.
INCOME TAX EXPENSE (NOK 1 000) 2022 2021
Expected tax expense (35 448) (33 253)
Net non-taxable income (1 047) (1 045)
Other items 3 980 (26)
Change in deferred tax assets not recognized 32 515 34 323
Effect from changes in tax rate - -
Income tax expense - -
Ultimovacs has not recognized a deferred tax asset in the statement of financial position related to its
previous losses, as the Company does not expect taxable income to be generated in the short-term to
support the use of the deferred tax asset. Total tax losses carried forward and temporary differences as
per 31 December 2021 was MNOK 540.6, and MNOK 688.4 as per 31 December 2022.
DEFERRED TAX ASSETS (NOK 1 000) 2022 2021
Tax losses carried forward 675 754 529 008
Temporary differences - financial instruments (1 083) (759)
Temporary differences - leasing liability 37 134
Temporary differences - social security on options 13 488 12 009
Temporary differences - PP&E 238 246
Temporary differences and tax loss carry forward 688 435 540 637
Deferred tax assets - not recognized in statement of financial position 151 456 118 940
Deferred tax assets per 31 December - -
Chapters
1
2
3
4
5
105 ULTIMOVACS2022
Financial statements
Note 8: Earnings per share
The basic earnings per share (EPS) are calculated as the ratio of the total profit (loss) for the year divided
by the weighted average number of ordinary shares outstanding. As the Group has currently no potential
issuable ordinary shares, basic and diluted earnings per share is the same.
The issued share options have a potential dilutive effect on earnings per share. No dilutive effect has
been recognized, as potential ordinary shares only shall be treated as dilutive if their conversion to
ordinary shares would decrease earnings per share or increase loss per share from continuing operations.
As the Group is currently loss-making, an increase in the average number of shares would have anti-
dilutive effects. Diluted and basic (undiluted) earnings per share is therefore the same.
EARNINGS PER SHARE 2022 2021
Profit (loss) for the year (NOK 1 000) (161 126) (151 149)
Average number of outstanding shares during the year (1 000) 34 247 32 373
EPS - basic and diluted (NOK per share) (4.7) (4.7)
A share option program was introduced in June 2019 and at the ordinary General Assembly held on 15
April 2022, the Board was authorized until the next ordinary General Assembly in 2023 to increase the
Company’s share capital in connection with the share incentive arrangement by up to NOK 342,217.61. A
total of 2,138,885 share options are outstanding as per 31 December 2022, corresponding to 6.22% of the
outstanding number of shares in the Company.
Please see note 15 for more information regarding the option program.
Chapters
1
2
3
4
5
106 ULTIMOVACS2022
Financial statements
Note 9: Non-current assets
NON-CURRENT ASSETS 2022 (NOK 1 000)
OFFICE AND
LAB EQUIPM.
PATENTS TOTAL
Accumulated cost as of 1 January 2022 2 148 9 000 11 148
Additions 195 - 195
Cost as of 31 December 2022 2 344 9 000 11 344
Accumulated depreciation and amortization as of 1 January 2022 (1 936) (2 461) -4 397
Depreciations in the year (188) (754) -943
Accumulated depreciation and amortization as of 31 December 2022 (2 124) (3 215) -5 339
Carrying value as of 31 December 2022
220 5 784
6 004
Patents
In 2015, the Group acquired all rights to the patents and technology from Inven2 AS, which is one of the
Group’s main shareholders. The price for the patent was MNOK 4.0 and was based on a purchase option
in the license agreement entered into with Inven2 AS in 2011. The purchase of these rights implies that
the Group no longer has to pay future royalties to Inven2 AS from potential commercial sales of products
related to the patents/patent applications. The patent period spans over 15 years and expires in 2031.
According to the purchase agreement related to the same patents, Inven2 AS is entitled to two milestone
payments of MNOK 5.0 and MNOK 6.0 at the commencement of a clinical Phase IIb and Phase III study
(or another registration study) respectively. The first milestone payment of MNOK 5.0 was paid to
Inven2 in May 2020 due to the commencement of the INITIUM Phase II trial. The milestone payment
was capitalized in the balance sheet when it was paid to Inven2 and will be depreciated linearly until
February 2031.
NON-CURRENT ASSETS 2021 (NOK 1 000)
OFFICE AND
LAB EQUIPM.
PATENTS TOTAL
Accumulated cost as of 1 January 2021 2 063 9 000 11 063
Additions 85 - 85
Cost as of 31 December 2021 2 148 9 000 11 148
Accumulated depreciation and amortization as of 1 January 2021 (1 686) (1 707) (3 393)
Depreciations in the year (250) (754) (1 004)
Accumulated depreciation and amortization as of 31 December 2021 (1 936) (2 461) (4 397)
Carrying value as of 31 December 2021 212 6 539 6 752
Economic Life 3 years 15 years
Depreciation method linear linear
Chapters
1
2
3
4
5
107 ULTIMOVACS2022
Financial statements
Note 10: Other receivables
OTHER RECEIVABLES (NOK 1 000) 2022 2021
Government grants receivables (ref note 3) 4 990 5 314
Prepayments 2 916 878
Fair value of currency contracts 1 083 759
Other receivables 435 588
Total other receivables 9 424 7 539
Note 11: Cash and cash equivalents
CASH AND CASH EQUIVALENTS (NOK 1 000) 2022 2021
Employee withholding tax 1 818 1 855
Cash at bank 418 547 571 400
Cash and cash equivalents 420 365 573 255
Note 12: Share capital, shareholder information and dividend
In September and November 2022, a total of 174,700 options, granted under Ultimovacs’ option program,
were exercised. Subsequently, the Company’s share capital was increased by NOK 17,470 by issuing
174,700 new shares, each share of par value NOK 0.10.
In a private placement in October 2021, 2,160,000 new shares each with a par value of NOK 0.10 and
issued at a subscription price per share of NOK 125.0, resulting in gross proceeds from the share issue of
MNOK 270. The transaction costs related to the share-issues amounted to MNOK 11.0 in 2021, and have
been recognized against share premium. For computation of earnings per share and diluted earnings per
share see Note 8.
In March and October 2021, a total of 88,250 options, granted under Ultimovacs’ option program, were
exercised. Subsequently, the Company’s share capital was increased by NOK 8,825 by issuing 88,250 new
shares, each share of par value NOK 0.10.
The share capital as of 31 December 2022 was NOK 3,439,646.1, with 34,396,461 ordinary shares with a
nominal value of NOK 0.1. All issued shares have equal voting rights and the right to receive dividend.
No dividend has been paid in the period. Ultimovacs ASA has approximately 5,000 shareholders as of 31
December 2022, with the 20 largest shareholders as of this date listed in a table below on the next page.
The movement in the number of registered shares and share capital was in 2021 and 2022 as follows:
As of 31 December 2022, cash and cash equivalents amounted to MNOK 420.4, of which MNOK 19.7
(MEUR 1.9) on an EUR account.
CHANGES TO SHARE CAPITAL
SHARE CAPITAL
NUMBER OF SHARES
SHARE CAPITAL
(NOK 1 000)
31 December 2020 31 973 511 3 197 351.1
Issuance of ordinary shares 2 248 250 224 825.0
31 December 2021 34 221 761 3 422 176.1
Issuance of ordinary shares 174 700 17 470
31 December 2022 34 396 461 3 439 646.1
Chapters
1
2
3
4
5
108 ULTIMOVACS2022
Financial statements
Note 12: Share capital, shareholder information and dividend (continued)
THE 20 MAIN SHAREHOLDERS AS OF 31 DECEMBER 2022
NUMBER OF
SHARES
OWNERSHIP
INTEREST
Gjelsten Holding AS 6 495 866 18.9 %
Canica AS 2 705 957 7.9 %
Watrium AS 1 780 575 5.2 %
Inven2 AS 1 555 492 4.5 %
Folketrygdfondet 1 515 813 4.4 %
Radforsk Investeringsstiftelse 1 512 163 4.4 %
Langøya Invest AS 1 389 006 4.0 %
Helene Sundt AS 965 802 2.8 %
CGS Holding AS 882 132 2.6 %
Sundt AS 803 321 2.3 %
Danske Invest Norge Vekst 736 440 2.1 %
Stavanger Forvaltning AS 590 000 1.7 %
Prieta AS 533 988 1.6 %
Verdipapirfondet Nordea Avkastning 480 573 1.4 %
SEB Prime Solutions Sissener Canopus 400 000 1.2 %
Verdipapirfondet KLP Aksjenorge 348 416 1.0 %
Swedbank AB 252 814 0.7 %
Wiarom AS 250 000 0.7 %
Verdipapirfondet Nordea Kapital 246 178 0.7 %
Gade, Leif Johan 225 052 0.7 %
20 Largest shareholders 23 669 588 68.8%
Other shareholders 10 726 873 31.2%
Total
34 396 461
100.0%
As of 31 December 2022, four members of the Management team in the Group held a total of 163,066
ordinary shares in Ultimovacs.
NUMBER OF SHARES HELD BY CEO AND THE BOARD OF DIRECTORS
AS OF 31 DECEMBER 2022
POSITION
NUMBER OF
SHARES
Carlos de Sousa CEO 14 906
Ketil Fjerdingen - through Langøya Invest AS Board member 1 389 006
Leiv Askvig - through Basen Kapital AS Board member 91 500
Henrik Schussler - through Fireh AS Board member 30 900
Eva S. Dugstad Board member 6 400
Kari Grønås - through K OG K AS Board member 6 640
Total shares held by CEO and Board of Directors 1 539 352
Chapters
1
2
3
4
5
109 ULTIMOVACS2022
Financial statements
Note 12: Share capital, shareholder information and dividend (continued)
THE 20 MAIN SHAREHOLDERS AS OF 31 DECEMBER 2021
NUMBER OF
SHARES
OWNERSHIP
INTEREST
Gjelsten Holding AS
6 495 866
19.0 %
Canica AS
2 705 957
7.9 %
Watrium AS 1 780 575 5.2 %
Inven2 AS 1 555 492 4.5 %
Radforsk Investeringsstiftelse 1 506 913 4.4 %
Folketrygdfondet 1 400 000 4.1 %
Langøya Invest AS 1 389 006 4.1 %
Helene Sundt AS 965 802 2.8 %
CGS Holding AS 882 132 2.6 %
Sundt AS 803 321 2.3 %
Danske Invest Norge Vekst 736 440 2.2 %
Stavanger Forvaltning AS 596 999 1.7 %
Prieta AS 533 988 1.6 %
Verdipapirfondet Nordea Avkastning 483 573 1.4 %
JPMorgan Chase Bank, N.A., London 402 495 1.2 %
Verdipapirfondet KLP AksjeNorge 348 416 1.0 %
SEB Prime Solutions Sissener Canopus 324 000 0.9 %
Verdipapirfondet Nordea Kapital 282 549 0.8 %
Avanza Bank AB (Nominee) 274 520 0.8 %
Swedbank AB 258 629 0.8 %
20 Largest shareholders 23 726 673 69.3%
Other shareholders 10 495 088 30.7%
Total
34 221 761
100.0%
NUMBER OF SHARES HELD BY CEO AND THE BOARD OF DIRECTORS
AS OF 31 DECEMBER 2021
POSITION
NUMBER OF
SHARES
Carlos de Sousa CEO 11 906
Ketil Fjerdingen - through Langøya Invest AS Board member 1 389 006
Leiv Askvig - through Basen Kapital AS Board member 91 500
Henrik Schussler - through Fireh AS Board member 30 900
Eva S. Dugstad Board member 6 400
Kari Grønås - through K OG K AS Board member 6 640
Håkan Englund - through JDS Invest AB Deputy Board member 73 650
Total shares held by CEO and Board of Directors 1 610 002
As of 31 December 2021, three members of the Management team in the Group held a total of 156,606
ordinary shares in Ultimovacs.
Chapters
1
2
3
4
5
110 ULTIMOVACS2022
Financial statements
Note 13: Transactions with related parties
In 2015, Ultimovacs acquired the patent rights for the core UV1 technology from Inven2 AS, a major
shareholder in the Group. Based on the agreements, Invent2 AS is entitled to receive two potential
milestone payments when certain clinical research criteria are reached: MNOK 5.0 and MNOK 6.0 at the
commencement of a clinical Phase IIb and Phase III study (or another registration study) respectively. The
first milestone payment of MNOK 5.0 was paid to Inven2 in May 2020 due to the commencement of the
INITIUM Phase II trial.
Please refer to note 9 for additional information.
As part of ordinary business and at market price, Ultimovacs purchases services related to clinical trials and
laboratory services from Oslo University Hospital through Inven2 AS. Invoicing directly from or administered
by Inven2 AS amounted to MNOK 4.3 in 2021 and MNOK 2.9 in 2022 respectively (incl. VAT). As per 31
December 2022, Ultimovacs had no outstanding payables to Inven2 AS.
Ultimovacs ASA partly finances running operations and projects in its Swedish subsidiary Ultimovacs AB
through unconditional shareholder contributions. In 2021, Ultimovacs ASA contributed with a total of MNOK
12.0 in unconditional shareholder contributions to Ultimovacs AB, and MNOK 8.0 in 2022.
As of 2022, Ultimovacs ASA and Ultimovacs AB have entered into an intercompany agreement where
Ultimovacs AB will provide R&D services for Ultimovacs ASA, and thus invoice Ultimovacs ASA for these
services. Direct and indirect costs pertaining to Ultimovacs AB’s employees’ performance of the services
as well as other direct costs are invoiced using a ‘cost plus’ model. In 2022, MNOK 9.9 was invoiced from
Ultimovacs AB to Ultimovacs ASA.
Chapters
1
2
3
4
5
111 ULTIMOVACS2022
Financial statements
Note 14: Leases and commitments
The right-of-use assets comprise a rental agreement for office premises in Oslo with 3 years left of the
rental contract as of 31 December 2022, and four car-leasing contracts. The weighted average discount
rate applied is 8.3% as per 31 December 2022.
The Company has utilized the practical expedients relating to leases where short term leases and lease-
contracts of low value have not been recognized as right of use assets. Expenses relating to short-term
lease comprise lab premises and parking spaces in Oslo, Norway. These contracts can be terminated by
both lessee and lessor within 1 - 3 months. Expense relating to low-value assets comprise leasing of an
office printer in Oslo.
The Company had total cash outflows related to leases of MNOK 2.4 in FY21 and MNOK 2.5 in FY22.
LEASE EXPENSES (NOK 1 000) 2022 2021
Depreciation expense of right-of-use assets 1 705 1 698
Interest expense on lease liabilities 105 179
Expense relating to short-term leases (incl. in Other operating expenses) 642 502
Expense relating to low-value assets (incl. in Other operating expenses) 11 11
Total amount recognized in profit or loss 2 463 2 391
LEASE LIABILITIES (NOK 1 000) 2022 2021
Lease liability as per 1 January
2 084 3 781
Additions
5 199 19
Cash payments for the principal portion of the lease liability
(1 802) (1 716)
Cash payments for the interest portion of the lease liability
(105) (179)
Interest expense on lease liabilities
105 179
Lease liability as per 31 December
5 481 2 084
Current
1 767 1 628
Non-current
3 713 457
RIGHT-OF-USE ASSETS 2022 (NOK 1 000) CARS OFFICE TOTAL
Right-of-use assets as per 1 January 2022 680 1 270 1 951
Depreciation costs during the year (365) (1 340) (1 705)
Extension options exercised / additions 955 4 244 5 199
Balance sheet value as per 31 December 2022 1 270 4 174 5 444
RIGHT-OF-USE ASSETS 2021 (NOK 1 000) CARS OFFICE TOTAL
Right-of-use assets as per 1 January 2021 1 109 2 520 3 630
Depreciation costs during the year (429) (1 269) (1 698)
Extension options exercised / additions - 19 19
Balance sheet value as per 31 December 2021 680 1 270 1 951
NON-DISCOUNTED LEASE LIABILITIES EXPIRING WITHIN THE FOLLOWING PERIODS
FROM THE BALANCE SHEET DATE (NOK 1 000)
2022 2021
Within 1 year 2 147 1 708
1 to 2 years 2 058 285
2 to 3 years 1 862 196
3 to 4 years 112 -
4 to 5 years - -
Over 5 years - -
Sum 6 179 2 190
Chapters
1
2
3
4
5
112 ULTIMOVACS2022
Financial statements
Note 15: Share based payment
Share option program
The share option program was introduced in June 2019. The share option program is groupwide and
includes all employees in the Group. At the Annual General Meeting held on 21 April 2022, the Board was
authorized to increase the Company’s share capital in connection with the share incentive arrangement
by up to NOK 342,217.61. The authorization is valid until the next ordinary General Meeting in 2023.
Each option gives the right to acquire one share in the Company and is granted without consideration.
Pursuant to the vesting schedule, 25% of the options will vest one year after the day of grant, 25% of the
options will vest two years after the day of grant and the remaining 50% will vest three years after the day
of grant.
The options granted in 2020 to the CEO, Carlos de Sousa, will vest with 33.33% one year following the grant
date, 33.33% after two years, and the remaining 33.34% on the third anniversary following the grant date.
Vesting is dependent on the option holder still being employed in the Company.
The exercise price for all options granted in 2019 was NOK 31.25, NOK 39.15 for the options granted in 2020,
NOK 61.99 for the options granted in 2021 and NOK 83.46 for the options granted in 2022.
Options that are not exercised within 7 years from the date of grant will lapse and become void.
After the distribution of 480,000 new options on 21 April 2022 and the exercise of 174,700 shares during
2022, a total of 2,138,885 share options are granted per 31 December 2022, corresponding to 6.22% of the
outstanding number of shares in the Company.
OUTSTANDING INSTRUMENTS OVERVIEW AT YEAR END 2022 2021
Number of instruments 2 138 885 1 833 585
Weighted Average Exercise Price (NOK) 54.55 44.77
Weighted Average Exercise Price on vested instruments (NOK) 40.76 35.42
Vested/Exercisable instruments as of 31 December 860 454 419 328
Weighted Average remaining contractual life (years) 4.96 3.46
MOVEMENTS OF OPTIONS DURING 2021
NUMBER OF
INSTRUMENTS
WEIGHTED AVERAGE
EXERCISE PRICE
Outstanding at 1 January 1 330 435 36.16
Granted during the year 600 000 61.99
Terminated during the year (8 600) 39.15
Exercised during the year (88 250) 32.46
Expired during the year - -
Outstanding at 31 December 1 833 585 44.77
Vested options during the year 279 953 37.49
MOVEMENTS OF OPTIONS DURING 2022
NUMBER OF
INSTRUMENTS
WEIGHTED AVERAGE
EXERCISE PRICE
Outstanding at 1 January 1 833 585 44.77
Granted during the year 480 000 83.46
Terminated during the year - -
Exercised during the year (174 700) 31.39
Expired during the year - -
Outstanding at 31 December 2 138 885 54.55
Vested options during the year 441 126 45.85
Chapters
1
2
3
4
5
113 ULTIMOVACS2022
Financial statements
Note 15: Share based payment (continued)
Assumptions, costs and social security provisions:
The Ultimovacs Employee Share Options’ fair value is calculated according to the IFRS-2 regulations.
As stated in IFRS-2 Appendix B §B5 the Black-Scholes-Merton Option Pricing Model (“B&S Model”) may
be used to estimate the fair value of employee share options, which is therefore used to estimate the
fair value of the Ultimovacs Employee Share Options. The model uses the following parameters; the
exercise price, the current price of the underlying shares, the life of the option, the expected volatility of
the share price, the dividends expected on the shares, and the risk-free interest rate for the life of the
option.
The exercise price is set out in the Ultimovacs Award Agreements with each employee and is stated in
the Norwegian Krone. The current price of the underlying shares used in the model is the last available
closing price of Ultimovacs at grant date.
The risk-free interest rate used in the B&S Model is equal to the rates of the government bond issues of
the country in whose currency the exercise price is expressed, with the term equal to the expected term
of the option being valued. Since the exercise price is expressed in Norwegian Krone, the “Norges Bank
Statskasseveksler” and “Obligasjoner”-rate is used as input. The interest rates used for the options with
term structures outside of the quoted terms of Norges Banks interest rates are calculated with the use
of a linear interpolation between the two closest quoted rates.
A dividend parameter is not included in the calculations.
The B&S Model assumes that the time from grant until expiry gives the time parameter in the model.
This assumption is based on the options being free from restraints and that the owner of the options
holds the right to sell the option in the market at any time. As this is not the case for most employee
share options, IFRS-2 Appendix B §B16-18, states that a shorter time period can be used as the expected
lifetime of the options in some cases. Half a year after vesting date is therefore assumed to be the
estimated end-of-lifetime of each option in the model. However, exercise patterns will be monitored, and
expected option lifetime will be updated if needed for future grants.
As Ultimovacs has not been listed on a stock exchange long enough to have a sufficient share price
history to calculate the shares’ volatility, comparable firms’ share price volatility have been used to
estimate the expected volatility.
The fair value of the granted instruments in 2021 and 2022 have been calculated using a Black Scholes
model with the following assumptions:
*Weighted average parameters at grant of instrument
The total IFRS cost recognized for the option program was MNOK 10.9 in FY21 and MNOK 18.1 in FY22. The
total social security provision was MNOK 8.0 in FY21 and MNOK 1.5 in FY22.
FAIR VALUE PRICING ASSUMPTIONS 2022 2021
Instrument Option Option
Quantity as of 31 December 480 000 600 000
Contractual life* 7.00 7.00
Exercise price* 83.46 61.99
Share price* 81.60 62.10
Expected lifetime* 3.25 3.25
Volatility* 59.60% 48.12%
Interest rate* 2.2451% 0.067%
Dividend* - -
Fair value per instrument* 34.46 20.79
Vesting conditions Service condition
Chapters
1
2
3
4
5
114 ULTIMOVACS2022
Financial statements
Note 15: Share based payment (continued)
Note 16: Other current liabilities
OTHER CURRENT LIABILITIES (NOK 1 000) 2022 2021
Public duties payable 4 310 3 076
Public duties payable related to options 13 488 12 009
Holiday pay payable 3 301 3 032
Other accrued expenses 12 582 6 937
Sum 33 681 25 055
NUMBER OF OPTIONS HELD BY MANAGEMENT TEAM POSITION 2022 2021
Carlos de Sousa Chief Executive Officer 416 035 416 035
Hans Vassgård Eid Chief Financial Officer 224 500 177 500
Jens Egil Torbjørn Bjørheim Chief Medical Officer 215 000 168 000
Audun Tornes Chief Technology Officer 137 500 107 500
Gudrun Trøite Head of Project Coordination 96 814 107 500
Ingunn Hagen Westgaard Head of Research 111 395 107 500
Øivind Foss Head of Clinical Operations 104 500 107 500
Ton Berkien (employed in Ulimovacs AB) Chief Business Officer 106 000 59 000
Anne Worsøe Head of IR and Communication 22 500 -
Orla Mc Callion (employed in Ulimovacs AB) Head of Regulatory Affairs and QA 38 000 -
Total allocated share options to Management Team 1 472 244 1 250 535
Note 17: Financial instruments
2022 2022 2021 2021
FINANCIAL ASSETS (NOK 1 000)
CARRYING
VALUE
FAIR VALUE
CARRYING
VALUE
FAIR VALUE
Foreign exchange forward contracts 1 083 1 083 759 759
Total financial assets 1 083 1 083 759 759
Foreign exchange derivatives not designated as hedging instruments reflect the positive change in fair
value of those foreign exchange forward contracts that are not designated in hedge relationships, but
are, nevertheless, intended to reduce the level of foreign currency risk for expected purchases.
Foreign exchange forward contracts are valued at fair value which is also the market value of the
contract based on the use of market observable inputs at Level 2 of the fair value hierarchy (please
refer to ‘Note 2: Accounting principles - iii. Financial instruments’ for information regarding the ‘fair
value hierarchy’). Market values are calculated using mid-rates (excluding margins) as determined by the
financial institution counterparty on available market rates at reporting date.
Chapters
1
2
3
4
5
115 ULTIMOVACS2022
Financial statements
Note 17: Financial instruments (continued)
Financial risk
The most significant financial risks for the Company are liquidity risk, credit risk and foreign currency
risk. Management continuously evaluates these risks and determines policies related to how these risks
are to be handled within the Company.
Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument of
customer contract, leading to a financial loss. The Company is exposed to credit risk from its receivables,
deposits in banks.
Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall
due. The Company’s approach to managing liquidity is to ensure, as far as possible, that it will always
have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions,
without incurring unacceptable losses or risking damage to the Company’s reputation.
Interest rate risk
The Company has no interest-bearing debt. Bank deposits are exposed to market fluctuations in interest
rates, which impact the financial income.
Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate
because of changes in foreign exchange rates. The Group’s exposure to the risk of changes in foreign
exchange-rates relates to the Group’s operating activities, primarily expenses in USD, EUR, SEK and GBP.
During 2022 the Company has held funds in EUR and entered into EUR swaps to mitigate the foreign
exchange risk and to get a better predictability regarding future costs. The fair value of forward exchange
contracts are determined using the forward exchange rate at the end of the reporting period, with
changes in the value recognized in the income statement. In the income statement, impacts from the
derivatives are presented as loss/gains in the financial items.
The Company does not use financial instruments, including financial derivatives, for trading purposes.
The table below show a sensitivity to a 10% increase/decrease in EUR, GBP, USD and SEK against NOK
and the effect on Profit (loss) before tax:
FOREIGN CURRENCY SENSITIVITY (NOK 1 000) CHANGE IN FOREIGN CURRENCY 2022 2021
EUR
+10% 25 198 26 513
-10% (25 198) (26 513)
GBP
+10% 572 446
-10% (572) (446)
USD
+10% 1 317 821
-10% (1 317) (821)
SEK
+10% 1 402 1 451
-10% (1 402) (1 451)
INTEREST RATE SENSITIVITY (NOK 1 000) CHANGE IN INTEREST RATE 2022 2021
Bank deposits
+2% 9 646 8 284
-2% (9 646) (8 284)
+5% 24 115 20 709
-5% (24 115) (20 709)
Note that the majority of the simulated EUR sensitivity effects are related to EUR at bank and the
forward exchange contracts which effects Profit (loss) before tax when EUR/NOK fluctuates.
Currency fluctuations in regards to the bank deposits in foreign currency and the foreign exchange
forward contracts will not result in any ‘other comprehensive income’ (OCI) effects.
Chapters
1
2
3
4
5
116 ULTIMOVACS2022
Financial statements
Note 17: Financial instruments (continued)
Fair value
The Management assessed that the fair values of cash and cash equivalents, accounts receivable,
accounts payable and other current liabilities approximate their carrying amounts largely due to the
short-term maturities of these instruments.
Capital management
The Company manages its capital to ensure that Company will be able to continue as a going concern
while maximizing the return to stakeholders through the optimization of the debt and equity balance.
The Company’s policy is to maintain a strong capital base so as to maintain investor, creditor and market
confidence and to support future development of the business. The Company is currently sufficiently
capitalized as per 31 December 2022. Management closely monitors the Company’s cash flows short-
term and long-term and continuously assesses the need for additional funding.
The capital structure of the Company consists of equity attributable to owners of the Company,
comprising share capital, share premium and accumulated losses.
The Company is not subject to any externally imposed capital requirements.
On the 10 July 2018, Ultimovacs ASA acquired 100% of the shares in the Swedish biotech company TET
Pharma AB, now Ultimovacs AB, from Immuneed AB at a consideration of MNOK 50.5 (MSEK 55.0). The
business is located in Uppsala, Sweden and has five employees. The share capital in Ultimovacs AB is
SEKk 50.
Ultimovacs ASA partly finances running operations and projects in Ultimovacs AB through unconditional
shareholder contributions. As at 31 December 2022, Ultimovacs AS has contributed with a total of MNOK
32.5 in unconditional shareholder contributions to Ultimovacs AB, of which MNOK 8.0 in FY22.
The impairment test performed as of 31 December 2022 did not result in any impairment of book value
of the investment in Ultimovacs AB. The impairment test was based on the same assumptions as used in
the impairment test of “goodwill” and “licenses” in the group accounts.
Note 18: Investment in subsidiary
INVESTMENT IN SUBSIDIARY (NOK 1 000) 2022 2021
Investment in subsidiary as at 01 January 77 512 65 512
Unconditional shareholder contribution to Ultimovacs AB 8 000 12 000
Investment in subsidiary as at 31 December 85 512 77 512
Chapters
1
2
3
4
5
117 ULTIMOVACS2022
Financial statements
Note 19: Events after the balance sheet date
On 23 January 2023, Ultimovacs announced that patient enrollment was completed in the NIPU Phase II
clinical trial in metastatic pleural mesothelioma.
In February 2023, as part of the Q4 2022 reporting, Ultimovacs provided an update on guidance regarding
topline data readouts for its Phase II clinical trials:
• INITIUM (malignant melanoma): H1 2023 (no change from previous statements)
• NIPU (pleural mesothelioma): H1 2023 (no change from previous statements)
• FOCUS (head and neck cancer): H1 2024
• DOVACC (ovarian cancer): H2 2024
• LUNGVAC (non-small cell lung cancer): H2 2025
There are no other significant subsequent events after the balance sheet date.
Chapters
1
2
3
4
5
118 ULTIMOVACS2022
Sentrum, 0107 Oslo
Foretaksregisteret: NO 976 389 387 MVA
Tlf: +47 24 00 24 00
www.ey.no
Medlemmer av Den norske
Revisorforening
A member firm of Ernst & Young Global Limited
INDEPENDENT AUDITOR'S REPORT
To the Annual Shareholders' Meeting of Ultimovacs ASA
Report on the audit of the financial statements
Opinion
We have audited the financial statements of Ultimovacs ASA (the Company), which comprise the
financial statements of the Company and the consolidated financial statements of the Company and its
subsidiaries (the Group). The financial statements of the Company and the Group comprise the statement
of financial position as at 31 December 2022, statement of profit and loss and other comprehensive
income, statement of cash flows and statement of changes in equity for the year then ended, and notes to
the financial statements, including a summary of significant accounting policies.
In our opinion the financial statements comply with applicable legal requirements and give a true and fair
view of the financial position of the Company and the Group as at 31 December 2022 and their financial
performance and cash flows for the year then ended in accordance with International Financial Reporting
Standards as adopted by the EU.
Our opinion is consistent with our additional report to the audit committee.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our
responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of
the financial statements section of our report. We are independent of the Company and the Group in
accordance with the requirements of the relevant laws and regulations in Norway and the International
Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants
(including International Independence Standards) (IESBA Code), and we have fulfilled our other ethical
responsibilities in accordance with these requirements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
To the best of our knowledge and belief, no prohibited non-audit services referred to in the Audit
Regulation (537/2014) Article 5.1 have been provided.
We have been the auditor of the Company for eight years from the election by the general meeting of the
shareholders on 21 April 2015 for the accounting year 2015.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial statements for 2022. We have determined that there are no key audit matters to
communicate in our report.
Other information
Other information consists of the information included in the annual report other than the financial
statements and our auditor’s report thereon. Management (the board of directors and Chief Executive
Officer) is responsible for the other information. Our opinion on the financial statements does not cover
the other information, and we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information,
and, in doing so, consider whether the board of directors’ report, the statement on corporate governance
Chapters
1
2
3
4
5
119 ULTIMOVACS2022
2
Independent auditor's report - Ultimovacs ASA 2022
A member firm of Ernst & Young Global Limited
and the statement on corporate social responsibility contain the information required by legal
requirements and whether the other information is materially inconsistent with the financial statements or
our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the
work we have performed, we conclude that the other information is materially inconsistent with the
financial statements, there is a material misstatement in this other information or that the information
required by applicable legal requirements is not included in the board of directors’ report, the statement
on corporate governance or the statement on corporate social responsibility, we are required to report
that fact.
We have nothing to report in this regard, and in our opinion, the board of directors’ report, the statement
on corporate governance and the statement on corporate social responsibility are consistent with the
financial statements and contains the information required by applicable legal requirements.
Responsibilities of management for the financial statements
Management is responsible for the preparation and fair presentation of the financial statements in
accordance with International Financial Reporting Standards as adopted by the EU, and for such internal
control as management determines is necessary to enable the preparation of financial statements that
are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company’s and the
Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless management either intends to liquidate the
Company or the Group, or to cease operations, or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with ISAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional
scepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override
of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company’s and the Group’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Company’s and the Group’s ability to
continue as a going concern. If we conclude that a material uncertainty exists, we are required to
draw attention in our auditor’s report to the related disclosures in the financial statements or, if
Chapters
1
2
3
4
5
120 ULTIMOVACS2022
3
Independent auditor's report - Ultimovacs ASA 2022
A member firm of Ernst & Young Global Limited
such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor’s report. However, future events or conditions
may cause the Company and the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and
events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the consolidated financial
statements. We are responsible for the direction, supervision and performance of the group audit.
We remain solely responsible for our audit opinion.
We communicate with the board of directors regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide the audit committee with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters
that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the board of directors, we determine those matters that were of
most significance in the audit of the financial statements of the current period and are therefore the key
audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should
not be communicated in our report because the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communication.
Report on other legal and regulatory requirement
Report on compliance with regulation on European Single Electronic Format (ESEF)
Opinion
As part of our audit of the financial statements of Ultimovacs ASA we have performed an assurance
engagement to obtain reasonable assurance about whether the financial statements included in the
annual report, with the file name ultimovacsasa-2022-12-31-en, have been prepared, in all material
respects, in compliance with the requirements of the Commission Delegated Regulation (EU) 2019/815
on the European Single Electronic Format (ESEF Regulation) and regulation pursuant to Section 5-5 of
the Norwegian Securities Trading Act, which includes requirements related to the preparation of the
annual report in XHTML format and iXBRL tagging of the consolidated financial statements.
In our opinion, the financial statements included in the annual report have been prepared, in all material
respects, in compliance with the ESEF Regulation.
Management’s responsibilities
Management is responsible for the preparation of the annual report in compliance with the ESEF
Regulation. This responsibility comprises an adequate process and such internal control as management
determines is necessary.
Auditor’s responsibilities
Our responsibility, based on audit evidence obtained, is to express an opinion on whether, in all material
respects, the financial statements included in the annual report have been prepared in accordance with
the ESEF Regulation. We conduct our work in accordance with the International Standard for Assurance
Engagements (ISAE) 3000 – “Assurance engagements other than audits or reviews of historical financial
information”. The standard requires us to plan and perform procedures to obtain reasonable assurance
Chapters
1
2
3
4
5
121 ULTIMOVACS2022
4
Independent auditor's report - Ultimovacs ASA 2022
A member firm of Ernst & Young Global Limited
about whether the financial statements included in the annual report have been prepared in accordance
with the ESEF Regulation.
As part of our work, we perform procedures to obtain an understanding of the company’s processes for
preparing the financial statements in accordance with the ESEF Regulation. We test whether the financial
statements are presented in XHTML-format. We evaluate the completeness and accuracy of the iXBRL
tagging of the consolidated financial statements and assess management’s use of judgement. Our
procedures include reconciliation of the iXBRL tagged data with the audited financial statements in
human-readable format. We believe that the evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Oslo, 23 March 2023
ERNST & YOUNG AS
The auditor's report is signed electronically
Erik Søreng
State Authorised Public Accountant (Norway)
Chapters
1
2
3
4
5
WORDS / TERMS DESCRIPTION
General/basic terms
UV1 UV1 is Ultimovacs’ synthetic peptide vaccine
Peptides
Peptides are short or long-chains of amino acids, and amino acids are the building
blocks of protein.
Immune response The activity of the immune system against foreign substances (antigens).
Adjuvant A medical substance used to enhance the effect of another medical substance.
GM-CSF
“Granulocyte-macrophage colony-stimulating factor”. Ultimovacs uses GM-CSF
as adjuvant together with UV1 to strengthen the ability of UV1 to stimulate the
immune system.
Immune checkpoint inhibitors
Medicines that “takes the brakes off the immune system”. The immune system has
brakes necessary to balance a normal immune response. The downside to these
brakes is that it makes it easier for a tumor to grow because the immune sys-
tem becomes less able to fight the tumor. By “blocking the brakes”, the immune
system becomes more potent in killing tumor cells. PD-1 / PDL-1 inhibitors (e.g.,
pembrolizumab and nivolumab) and CTLA-4 inhibitors (e.g. ipilimumab). There are
many others in development.
Investigational New Drug (IND)
The United States Food and Drug Administration’s Investigational New Drug (IND)
program is the means by which a pharmaceutical company obtains permission
to start human clinical trials and to ship an experimental drug across state lines
(usually to clinical investigators) before a marketing application for the drug has
been approved. Similar procedures are followed in the European Union, Japan, and
Canada.
CTLA-4
A protein found on T cells (a type of immune cell) that helps balancing a normal
immune response. The balance is needed to avoid collateral damage of normal
cells. When CTLA-4 is bound to another protein called B7, it helps keep T cells
from multiplying and killing other cells, including cancer cells. Ipilimumab works
by making it difficult for the CTLA-4 to bind to B7. Ipilimumab was the first check-
point inhibitor to reach the market.
PARP Inhibitor
PARP inhibitors are a group of pharmacological inhibitors of the enzyme poly ADP
ribose polymerase. They are developed for multiple indications, including the
treatment of heritable cancers. Several forms of cancer are more dependent on
PARP than regular cells, making PARP an attractive target for cancer therapy
PD-1 / PD-L1
A protein found on T cells (a type of immune cell) that helps balancing a normal
immune response. The balance is needed to avoid collateral damage of normal
cells. When PD-1 is bound to another protein called PD-L1, it helps keep T cells
from killing other cells, including cancer cells. Some anticancer drugs, called
immune checkpoint inhibitors, are used to block PD-1 or PD-L1. When this check-
point is blocked, the “brakes” on the immune system are released and the ability
of T cells to kill cancer cells is increased.
Telomere
To prevent the loss of genes as chromosome ends wear down, the tips of eukary-
otic chromosomes have specialized DNA “caps” called telomeres.
Telomerase
Some cells have the ability to reverse telomere shortening by expressing telomer-
ase (hTERT), an enzyme that extends the telomeres of chromosomes. Telomerase
is expressed at a high level in over 80% of human tumors. UV1 uses telomerase
(hTERT) as an immune therapy target.
Tetanus
Tetanus (Norwegian: “Stivkrampe”) is a serious illness contracted through expo-
sure to the spores of the bacterium, Clostridium tetani, which live in soil, saliva,
dust, and manure. The bacteria can enter the body through deep cuts, wounds or
burns affecting the nervous system. The infection leads to painful muscle con-
tractions, particularly of the jaw and neck muscle, and is commonly known as
“lockjaw”. Tetanus vaccination protects against the disease.
PARP and Checkpoint inhibitors
Ipilimumab Anti-CTLA-4 checkpoint inhibitor from BMS (Bristol-Myers Squibb)
Nivolumab Anti-PD-1 checkpoint inhibitor from BMS (Bristol-Myers Squibb)
Pembrolizumab Anti-PD-1 checkpoint inhibitor from Merck (Merck & Co. Inc.)
Durvalumab Anti-PD-L1 checkpoint inhibitor from AstraZeneca
Cemiplimab PD-L1 checkpoint inhibitor from Regeneron Pharmaceuticals
Olaparib PARP inhibitor from AstraZeneca
Glossary
WORDS / TERMS DESCRIPTION
Clinical trial terms
CR
Complete response (The disappearance of all signs of cancer in response to treat-
ment. Also called complete remission.)
DOR
Duration of response (The length of time that a tumor continues to respond to
treatment without the cancer growing or spreading.)
PR
Partial response (A decrease in the size of a tumor, or in the extent of cancer in
the body, in response to treatment. Also called partial remission.)
SD
Stable disease (Cancer that is neither decreasing nor increasing in extent or sever-
ity.)
PD Progressive disease (Cancer that is growing, spreading, or getting worse.)
ORR Overall response rate = CR + PR
OS
Overall survival (The length of time from either the date of diagnosis or the start of
treatment for a disease, such as cancer, that patients diagnosed with the disease
are still alive. In a clinical trial, measuring the overall survival is one way to see
how well a new treatment works.)
PFS
Progression-free survival (The length of time during and after the treatment of a
disease, such as cancer, that a patient lives with the disease but it does not get
worse. In a clinical trial, measuring the progression-free survival is one way to see
how well a new treatment works.)
mPFS
Median overall survival (The length of time during and after the treatment of a
disease, such as cancer, that half of the patients in a group of patients diagnosed
with the disease are still alive.)
Medical terms
Intradermal
In order to initiate an immune response, a vaccine must be taken up by antigen
presenting cells (dendritic cells). UV1 is administered via the intradermal route, i.e.
injection in the dermis, one of the layers of the skin. This layer, underneath the
epidermis, is highly vascularized and contains a large amount of immune cells,
mainly dermal dendritic cells.
Biopsy
A piece of tissue, normal or pathological removed from the body for the purpose of
examination.
IgE
Immunoglobulin E (IgE) are antibodies produced by the immune system. If you
have an allergy, your immune system overreacts to an allergen (what you are al-
lergic to) by producing IgE. These antibodies travel to cells that release chemicals,
causing an allergic reaction when an allergen enters the body.
Metastasis/
Metastatic cancer
The development of malignant growths at a distance from a primary site of can-
cer/
Metastatic cancer is cancer that spreads from its site of origin to another part of
the body.
SAE
A serious adverse event (SAE) in human drug trials is defined as any untoward
medical occurrence that at any dose:
1. results in death,
2. is life-threatening,
3. requires inpatient hospitalization or causes prolongation of
existing hospitalization,
4. results in persistent or significant disability/incapacity,
5. is a congenital anomaly/birth defect, or
6. requires intervention to prevent permanent impairment or
damage.
The term “life-threatening” in the definition of “serious” refers to an event in
which the patient was at risk of death at the time of the event; it does not refer to
an event which hypothetically might have caused death if it were more severe. Ad-
verse events are further defined as “Any untoward medical occurrence in a patient
or clinical investigation subject administered a pharmaceutical product and which
does not necessarily have to have a causal relationship with this treatment.”
PSA
Prostate-specific antigen (PSA) is an enzyme (protein) important for reproduction.
PSA is present in small quantities in the serum of men with healthy prostates but
is often elevated in the presence of prostate cancer or other prostate disorders.
Glossary
Ultimovacs ASA
Ullernchausséen 64
0379 Oslo
Norway
E-mail: ir@ultimovacs.com
Telephone: + 47 413 80 080
Ultimovacs AB
Dag Hammarskjölds Väg 30
752 37 Uppsala
Sweden
www.ultimovacs.com
Our mission is to extend and improve the life of patients by directing the
immune system against the core of cancer.
We will provide universally accessible solutions.
254900B4VALJZR9TL7442022-01-012022-12-31254900B4VALJZR9TL7442021-01-012021-12-31254900B4VALJZR9TL7442022-12-31254900B4VALJZR9TL7442021-12-31254900B4VALJZR9TL7442020-12-31254900B4VALJZR9TL7442020-12-31ifrs-full:IssuedCapitalMember254900B4VALJZR9TL7442021-01-012021-12-31ifrs-full:IssuedCapitalMember254900B4VALJZR9TL7442021-12-31ifrs-full:IssuedCapitalMember254900B4VALJZR9TL7442020-12-31ifrs-full:SharePremiumMember254900B4VALJZR9TL7442021-01-012021-12-31ifrs-full:SharePremiumMember254900B4VALJZR9TL7442021-12-31ifrs-full:SharePremiumMember254900B4VALJZR9TL7442020-12-31ULT:PaidInCapitalMember254900B4VALJZR9TL7442021-01-012021-12-31ULT:PaidInCapitalMember254900B4VALJZR9TL7442021-12-31ULT:PaidInCapitalMember254900B4VALJZR9TL7442020-12-31ifrs-full:RetainedEarningsMember254900B4VALJZR9TL7442021-01-012021-12-31ifrs-full:RetainedEarningsMember254900B4VALJZR9TL7442021-12-31ifrs-full:RetainedEarningsMember254900B4VALJZR9TL7442020-12-31ifrs-full:OtherReservesMember254900B4VALJZR9TL7442021-01-012021-12-31ifrs-full:OtherReservesMember254900B4VALJZR9TL7442021-12-31ifrs-full:OtherReservesMember254900B4VALJZR9TL7442020-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember254900B4VALJZR9TL7442021-01-012021-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember254900B4VALJZR9TL7442021-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember254900B4VALJZR9TL7442022-01-012022-12-31ifrs-full:IssuedCapitalMember254900B4VALJZR9TL7442022-12-31ifrs-full:IssuedCapitalMember254900B4VALJZR9TL7442022-01-012022-12-31ifrs-full:SharePremiumMember254900B4VALJZR9TL7442022-12-31ifrs-full:SharePremiumMember254900B4VALJZR9TL7442022-01-012022-12-31ULT:PaidInCapitalMember254900B4VALJZR9TL7442022-12-31ULT:PaidInCapitalMember254900B4VALJZR9TL7442022-01-012022-12-31ifrs-full:RetainedEarningsMember254900B4VALJZR9TL7442022-12-31ifrs-full:RetainedEarningsMember254900B4VALJZR9TL7442022-01-012022-12-31ifrs-full:OtherReservesMember254900B4VALJZR9TL7442022-12-31ifrs-full:OtherReservesMember254900B4VALJZR9TL7442022-01-012022-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember254900B4VALJZR9TL7442022-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMemberiso4217:NOKiso4217:NOKxbrli:shares