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The primary focus of Vaccicure in the third and fourth quarter of 2016 is reinitiating manufacturing activities and producing Good Manufacturing Practice (GMP)-compliant batches of PAS for future trials and for marketing registration purposes. The first 15-g demonstration batch utilizing starting materials from the existing inventory was produced as planned in July of 2016. In the third and fourth quarter the demonstration batch has undergone significant quality and analytical release testing. These tests have been completed and the final batch records and certification documentation were received indicating that the demonstration batch passed all testing.

Vaccicure intended to utilize raw materials from Cancer Advances existing raw materials inventory in the next manufacturing batch; the clinical and marketing registration batches scheduled for the first quarter 2017. The raw materials inventory was evaluated in April 2016 to ensure that the materials were within the release specification guidelines and are suitable for use in the manufacture of the PAS product. The peptide, linker and diphtheria toxoid were found to be within the release guidelines for manufacture, however, were deemed unsuitable for use by the contract manufacturer’s Qualified Person. These materials were produced prior to current regulatory guidelines pertaining to minimizing the risk of transmissible spongiform encephalopathy or bovine spongiform encephalopathy transmission. As a result, Vaccicure had to seek new peptide, linker and diphtheria toxoid from qualified suppliers that are compliant with current regulatory and quality guidelines. In the third and fourth quarter of 2016 Vaccicure identified, evaluated and audited several different vendors qualified to provide these materials. In November and December 2016 contracts were negotiated and entered into with three companies to obtain sufficient raw materials to produce the next batch of drug conjugate scheduled for manufacture during the first quarter of 2017. Additional starting materials to support the remaining manufacturing goals are currently being identified and negotiated.

In parallel with the pre-production manufacturing activities, the evaluation of the raw materials, and purchasing additional raw materials, the ongoing stability testing for the laboratory scale batches that were produced in late 2014 was completed during the fourth quarter finding that the laboratory scale batches remain within the stability specifications.

It is anticipated that the clinical and marketing batches will be manufactured, analyzed and tested during the first quarter of 2017. Based on the findings of these analyses, a follow up meeting with the FDA will be scheduled in the second quarter of 2017 to update the FDA on the manufacturing results and determine what steps need to be taken to receive market approval.

The development program is proceeding reasonably to schedule as set out in the Vaccicure Information Memorandum.