Lattice Biologics Offering Exclusive Access to Revolutionary High-Throughput Precision Chemotherapy Screening for Breast Cancer

SCOTTSDALE, AZ–(Marketwired – April 15, 2016) – Lattice Biologics Ltd. (TSX VENTURE:LBL) (OTCBB: BLVKF) is offering select breast reconstruction surgeons across the U.S. and Canada zero-cost access to what we aim to be the fastest and most clinically predictive cancer diagnostic. This unique opportunity comes on the heels of the commencement of the Company’s revolutionary new cancer screening study with the esteemed Sunnybrook Research Institute (SRI). The goal of the study is to demonstrate the life-saving speed and precision of high-throughput cancer screening methods when combined with Lattice Biologics’ proprietary technology used to accurately mimic the natural cancer tumor microenvironment, thus producing reliable treatment analytics.

Lattice Biologics will provide this unparalleled trial diagnostic service free of cost to a limited number of surgeons using the Company’s AdMatrix ADM Dermal Scaffold allografts (human acellular biologic made from donated human dermal tissue) for post-mastectomy breast reconstruction surgeries. AdMatrix is a natural collagen scaffold that remodels patients’ dermal tissue after surgery and reabsorbs into their own skin for a biocompatible, natural repair. This allograft offers the benefits of strong incorporation results, extremely low seroma rates, and increased cellular growth, tissue vascularization, and tissue regeneration for optimal healing.

NEW DIAGNOSTIC MECHANISM DRIVES RELIABLE CANCER TREATMENT PLANS:

The high-throughput screening methods being explored by Lattice Biologics and SRI are expected to enable scientists to analyze the effects of up to 10,000 anticancer drug permutations on a patient’s specific tumor cells within just 24 hours. The approach capitalizes on Lattice’s Biologics’ advanced extracellular matrix (ECM) technology which can recreate a realistic microenvironment in which to grow patient tumor biopsies within a laboratory setting, providing the potential for a novel true-to-life view of individual cancer tumor cellular behavior.

Analysis under genuine human conditions is expected to provide oncologists with exact recommendations for drugs, combinations, and dosages by permitting review of the full array of cancer treatment possibilities. Meanwhile, high content screening will lend precious speed to the process, positioning patients for success. The diagnostics service is extremely expedited, with a one-week turnaround anticipated.

“Ultimately, this technology may allow rapid, accurate, and patient-specific personalized cancer care that stands to revolutionize the field,” states Dr. Danny Enepekides, MD, FRCSC, MPH, Chief of Surgical Oncology and Regional Surgical Oncology Lead, CCO for the Sunnybrook Health Sciences Center and University of Toronto. “The ability to analyze chemo-sensitivity in patient-derived tumor specimens grown in vitro using ECM to mimic the natural human microenvironment may provide oncologists the ability to deliver the best cancer care possible. This is very exciting.”

“Lattice Biologic’s ECM technology is revolutionary in its unparalleled ability to accurately recreate complex tumor microenvironments because it allows us to grow biopsies from patients’ own cancer tumors in the laboratory, subject the tumors to multiple anticancer drugs, and observe the resulting behaviors all while sustaining natural conditions,” states Guy Cook, Chief Executive Officer of Lattice Biologics.

“This,” continues Cook, “will provide a never-before-seen understanding of how individual patients’ tumors respond to specific treatments, allowing physicians to prescribe anticancer treatments with new accuracy. This level of personalized medicine will change the entire cancer treatment game.”

MOVING BEYOND TODAY’S TREATMENT LIMITATIONS:

Currently, anticancer drugs are reviewed and approved specifically for different regions in the body, such as for pancreatic or ovarian cancer. Unfortunately, this approach overlooks how cancer cells really function and ignores the understanding that tumor response is not simply based on location within the body. Along this same line of thinking, the medical community’s standard approach to anticancer therapy selection depends mainly upon the location and grade of the tumor, stage of the disease, and general state of the patient. This generalized approach does not take into account the complex and unpredictable behavior of cancer cells and is notorious for missing the mark, resulting in medication with reduced healing potential and the development of drug resistances.

Improving upon this model, our new diagnostic tool allows us to analyze micro tumors’ susceptibility to an incredibly large number of anticancer drugs at once, including — importantly — those not approved for the tumor’s specific indication. In this way, if our screening method reveals that a patient’s breast cancer tumor cells respond to a drug that has been approved for a different indication, we can provide this personalized feedback along with recommended dosage and any beneficial combinations.

PARTICIPATION IN THIS PRECISION CHEMOTHERAPY SCREENING PROGRAM:

12 renowned plastic surgeons specializing in breast reconstruction currently participate in Lattice Biologics’ Scientific Advisory Board (SAB) for the implementation and research of this technology. The Company is looking to increase surgeon participation while the technology is still in a trial period before being established as a proven diagnostic tool. As capacity ramps up, Lattice and SRI are preparing to provide analysis of up to 400 individual cases per month.

Surgeons interested in learning more about this special new diagnostics service should contact Lattice Biologics CEO, Guy Cook at gcook@LatticeBiologics.com | mobile: 406-570-2658.

KEY BREAST CANCER STATISTICS:

• About 1 in 8 U.S. women (~12%) will develop invasive breast cancer over the course of her lifetime.
• An estimated 246,660 new cases of invasive breast cancer and 61,000 new cases of non-invasive breast cancer are expected to be diagnosed in women in the U.S. during 2016.
• Breast cancer death rates are higher for women in the U.S. than those for any other cancer, except lung cancer.
• Breast cancer is the most commonly diagnosed cancer among American women (with the exception of skin cancer), accounting for approximately 30% of newly diagnosed cancers in women.
• In 2016, there are more than 2.8 million women with a history of breast cancer in the U.S.
• Breast cancer is the most common cancer among Canadian women (excluding non-melanoma skin cancers).
• Breast cancer is the second leading cause of death from cancer in Canadian women.
• An estimated 25,000 women were diagnosed with breast cancer in 2015, representing 26% of all new cancer cases in women.
• An estimated 5,000 women died from breast cancer in 2015, representing 14% of all cancer deaths in women.
• On average, 68 Canadian women will be diagnosed with breast cancer every day.
• On average, 14 Canadian women will die from breast cancer every day.
• Based on 2010 estimates, about 1 in 9 Canadian women is expected to develop breast cancer during her lifetime and 1 in 30 will die from it.

(U.S. statistics courtesy of www.breastcancer.org, “U.S. Breast Cancer Statistics” March 2, 2016.)

(Canadian statistics courtesy of www.cancer.ca, “Breast Cancer Statistics” April 12, 2016.)

STUDY BACKGROUND:

On March 30, 2016, Lattice Biologics announced the commencement of an Industry Sponsored Collaboration Agreement with Sunnybrook Research Institute in Toronto, Ontario titled, “Conditional Reprogramming of Epithelial Cells to Determine Mechanisms of Resistance and Drug Sensitivity.” The purpose of the study is to develop new research methods for generating and observing natural tumor response to anticancer drugs within a laboratory environment and identify drug resistance and sensitivity on a patient-specific level. The success of these new methods would lead to the commercialization of high content screening (HCS) chemosensitivity testing for cancer patients.

KEY STUDY PARTIES:

• Sunnybrook Research Institute (SRI) (The “Institution”) in Toronto, Ontario, Canada.
• David Andrews, Ph.D., (The “Principal Investigator”) (Director and Senior Scientist, Biological Sciences — Sunnybrook Research Institute; Professor, Department of Biochemistry — University of Toronto) will be responsible for the proper conduct of the Study and assume medical and regulatory responsibility for any procedures occurring at the Institution.
• Lattice Biologics Ltd. (The “Sponsor”) based in Scottsdale, AZ, USA, takes responsibility for the initiation, management, and financing of the Study.

COMBATING FAILURES IN CURRENT RESEARCH MODELS:

Mounting evidence shows that drug failure rates for cancer is greater than any other therapeutic areas, with approximately 93% of anticancer drugs not obtaining licenses even though they show promise in the pre-clinical development phases¹. This is largely due to the unrealistic conditions under which new therapies are currently tested in preclinical disease models: using either cell lines (“cloned” cultures developed from a single cell, consisting only of cells with a uniform genetic makeup) or animal models. Neither of these methods accurately represent the true behavior of cancer tumors as they respond to medication within the human body.

Cancer cells do not operate in isolation, but interact with their environment so the human tumor microenvironment must be maintained in order to form dependable conclusions about tumor response. Given their shortcomings, today’s clinical trials can often produce misleading results, such as the conclusion that anticancer drugs that are effective in animal cells would be equally beneficial in humans or that human tumors would not eventually develop resistance to lab-proven drugs.

To overcome these hurdles, we must develop new disease models based on human biomaterials that more accurately mimic the natural tumor microenvironment to produce reliable results.

TREATMENT HISTORY: The Call for Personalized Medicine

Traditional cancer treatment methods have relied largely on physician hypothesis for medication plans and are not pre-tested according to each individual patient’s unique conditions. Although physicians have begun to select cancer treatments specific to certain patient populations based on the molecular characteristics of tumors, these advances have often failed to generate reliable clinical responses to treatment. Results remain unpredictable and positive responses are often short-lived. Failure to properly imitate the heterogeneous human cellular microenvironment and genetic instability of patient tumors within the laboratory is the basis for this unpredictability in existing pre-clinical treatment models.

The lack of available personalized tumor response data prior to prescription can lead to the selection of medication with reduced healing potential and result in discouraging drug resistances. In that event, the patient’s own weakened body becomes an experimental environment where the complex web of drug impacts plays out as the patient undergoes one strenuous chemical treatment after another in a potentially deadly game of guess-and-check.

Nowhere is speed and accuracy more critical than in the case of an aggressive disease. The more time that passes while trying to identify an effective medication strategy, the more the patient’s immune system and overall health can become compromised.

PURPOSE: Increased Accuracy, Speed, and Patient Health

The penultimate goal of the Study is to remove cancer patients from the medical “guinea pig” treatment process. In response to the shortcomings of traditional diagnostics, chemosensitivity assays (laboratory tests of patients’ cells that measure the number of tumor cells killed by chemotherapy) have been developed to analyze drug-induced responses in cancer cells so that the best drug or combination of drugs for the cancer being treated can be selected. However, they have still faced difficulty in accurately reproducing and maintain the tumor microenvironment.

To improve effectiveness, this study aims to develop new high-throughput research methods for screening biopsied tumor cells that have been cultivated within a clinical laboratory setting that closely mimics the tumor’s natural environment, which will enable the most accurate chemosensitivity determinations prior to patient treatment.

The study will utilize Lattice Biologics’ ECM technology to produce a realistic microenvironment with the potential to offer a true-to-life view into individual cancer tumors’ cellular behavior. Simultaneously, high-throughput / high content screening methods are poised to lend life-saving speed to the process and increase cost effectiveness. As envisioned, this clinical demonstration will be invaluable for understanding how patients would respond to a wide range of medications prior to beginning treatment.

This study will extend Dr. Andrews’ successful research in leukemia patient cells by using the Opera Phenix^™ High Content Screening System to image patient-derived breast and ovarian cancer cells. The cells will be grown as 2D and 3D tumor organoids (three-dimensional organ buds grown in vitro) via conditional reprogramming with a Rho-associated kinase inhibitor (for tumor metastasis inhibition).

The study’s hypothesis poses that accurate disease models based on human tumor cell biopsies are critical to understanding the pathophysiology of cancers and decreasing high anti-cancer drug failure rates.

References:

¹Hutchinson, L. and Kirk, R. (2011) High drug attrition rates — where are we going wrong?Nature Reviews/Clinical Oncology 8:189-190.

About Lattice Biologics Ltd.:

Lattice Biologics recently completed its RTO, becoming a publically traded company on January 4, 2016 and is traded as TSX-V: LBL and OTCBB: BLVKF. The Company is an emerging personalized/precision medicine leader in the field of cellular therapies and tissue engineering, with a focus on bone, skin, and cartilage regeneration.

Lattice Biologics develops and manufactures biologic products to domestic and international markets. Lattice’s products are used in a variety of applications, including:

• Enhancing fusion in spine surgery
• Enhancing breast reconstruction post mastectomy for breast cancer patients
• Sports medicine indications, including ACL repair
• Promotion of bone regeneration in foot and ankle surgery
• Promotion of skull healing following neurosurgery
• Enhancing wound repair in burn victims
• Subchondral bone defect repair in knee and other joint surgeries

Lattice Biologics maintains headquarters, laboratory and manufacturing facilities in Scottsdale, Arizona as well as offices in Toronto, Ontario. The facility includes ISO Class 1000 and ISO Class 100 clean rooms, and specialized equipment capable of crafting traditional allografts and precision specialty allografts for various clinical applications.

The Lattice Biologics organization includes a product development and scientific research team of Ph.D.’s, highly trained tissue bank specialists, surgical technicians, certified sterile processing and distribution technicians, and CNC operators who maintain the highest standards of aseptic technique throughout each step of the manufacturing process. From donor acceptance to the final packaging and distribution of finished allografts, Lattice is committed to maintaining the highest standards of allograft quality, innovation, and customer satisfaction.

Lattice Biologics maintains all necessary licensures to process and sell its tissue engineered products within the U.S. and internationally. This includes Certificates to Foreign Governments from the U.S. Food and Drug Administration (FDA) and registrations for 29 countries, which allow the export of bone, tendon, meniscus, ligament, soft tissue, and cartilage products outside of the U.S.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

This news release may include forward-looking statements that are subject to risks and uncertainties. All statements herein, other than statements of historical fact, are to be considered forward looking. Generally, forward-looking information can be identified by the use of forward-looking terminology such as “continuing”, “intends” or variations of such words and phrases or statements that certain actions, events or results “will” occur. Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made and they are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Lattice Biologics to be materially different from those expressed by such forward-looking statements or forward-looking information. Although Lattice Biologics believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, continued availability of capital and financing, and general economic, market or business conditions. There can be no assurances that such statements will prove accurate and, therefore, readers are advised to rely on their own evaluation of such uncertainties. We do not assume any obligation to update any forward-looking statements except as required under the applicable laws.

United States Advisory: The securities referred to herein have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), and may not be offered, sold, or resold in the United States or to, or for the account of or benefit of, a U.S. Person (as such term is defined in Regulation S under the U.S. Securities Act) unless an exemption from the registration requirements of the U.S. Securities Act is available. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in the state in the United States in which such offer, solicitation or sale would be unlawful.

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