On this page of StockholderLetter.com we present the 4/13/2023 shareholder letter from Equillium, Inc. — ticker symbol EQ. Reading current and past EQ letters to shareholders can bring important insights into the investment thesis.

 •  4/13/2023 Letter Continued (Full PDF)
 •  4/11/2024 EQ Stockholder Letter
 •  4/10/2025 EQ Stockholder Letter
 •  More "Drugs & Pharmaceuticals" Category Stockholder Letters
 •  EQ Benford's Law Stock Score = 90

EQ 4/13/2023 Shareholder/Stockholder Letter Transcript:

Annual Report | 2022

Equillium is a clinical-stage biotechnology company leveraging a deep
understanding of immunobiology to develop novel therapeutics to treat severe
autoimmune and inflammatory disorders with high unmet medical need.
The company   s pipeline consists of the following novel first-in-class
immunomodulatory assets targeting immuno-inflammatory pathways.

EQ101: a tri-specific cytokine inhibitor that selectively targets IL-2, IL-9,
and IL-15; currently under evaluation in a Phase 2 proof-of-concept study
of patients with alopecia areata.

EQ102: a bi-specific cytokine inhibitor that selectively targets IL-15 and IL21; currently under evaluation in a Phase 1 study to include healthy
volunteers and celiac disease patients.

Itolizumab: a monoclonal antibody that targets the CD6-ALCAM signaling
pathway which plays a central role in the modulation of effector T cells;
currently under evaluation in a Phase 3 study of patients with acute graftversus-host disease (aGVHD) and a Phase 1b study of patients with
lupus/lupus nephritis.
Equillium acquired rights to itolizumab through an exclusive partnership with
Biocon Limited and has entered a strategic partnership with Ono Pharmaceutical
Co., Ltd. for the development and commercialization of itolizumab under an
exclusive option and asset purchase agreement.
For more information, visit equilliumbio.com.

Dear Equillium Shareholders,
2022 was a transformative year for Equillium    
we expanded our pipeline with two whollyowned, first-in-class clinical-stage assets, added
a proprietary drug discovery platform and
finished the year with a strong balance sheet
expected to fund our development programs
through multiple key milestones. We made
significant strides on our strategic priorities,
while navigating challenging biotech industry
headwinds, which we believe will set us up for a
successful 2023 and beyond.
Our acquisition of Bioniz Therapeutics in
February 2022 was a major long-term and
potentially value-driving achievement. We
expanded our pipeline with two clinical stage
multi-cytokine inhibitors, EQ101 and EQ102,
and added a novel drug discovery platform. I   m
proud of our team   s efforts to not only close
this acquisition but also rapidly assimilate and
advance both assets into the clinic.
In the fourth quarter we initiated a Phase 2
proof-of-concept clinical study in adult subjects
with alopecia areata (AA) with EQ101, a first-inclass, tri-specific cytokine inhibitor selectively
targeting IL-2, IL-9 and IL-15, that may afford
significant advantages over other treatment
approaches, including JAK inhibitors which have
well known safety concerns. We also advanced
EQ102 into a Phase 1 single ascending
dose/multiple ascending dose clinical study in
healthy volunteers, following which we plan to
evaluate its biological activity in subjects with
celiac disease. EQ102 is a first-in-class, bispecific cytokine inhibitor that selectively
targets IL-15 and IL-21 that we believe may
represent an optimal approach to treating
celiac patients, for whom no therapeutics are
currently approved.
In December 2022 we entered into a strategic
partnership and option and asset purchase
agreement with Ono Pharmaceutical related to
itolizumab whereby we received initial
1
payments totaling approximately $39 million,
plus committed funding for itolizumab research
and development costs during the option
period. We also have the potential to earn
option exercise and milestone payments
totaling approximately $139 million1. The Ono
partnership further validates the potential of
itolizumab and is expected to provide us the
resources to continue advancing itolizumab in
our pivotal Phase 3 EQUATOR study in first-line
acute graft-versus-host disease, a severe lifethreatening disease, and Phase 1b EQUALISE
study in lupus nephritis.
With over $71 million in cash and investments
at the end of 2022 and significantly reduced
operating burn expected as a result of Ono   s
funding of itolizumab R&D expenses, we believe
we are in a strong financial position capable of
funding operations into 2025 and potentially
beyond if Ono exercises its option. We look
forward to a productive year of clinical
advancement and potential milestones from
the EQ101 study in AA and EQ102 first-inhuman study, as well as continuing to advance
itolizumab under our Ono partnership.
Additionally, we plan to continue leveraging our
proven business development capability to
identify strategic opportunities that could
potentially broaden our pipeline and/or further
strengthen our balance sheet.
I would like to sincerely thank our employees,
our partners, and the physicians and patients
who participate in our clinical studies, all of
whom are invaluable to Equillium.
Best regards,
Bruce Steel
President and Chief Executive Officer
March 23, 2023
Option exercise payment is denominated in Japanese yen (5 billion) and subject to currency exchange rates at the
time of payment (U.S. dollar amount estimated above is based on the exchange rate as quoted by MUFG Bank, Ltd.
on March 16, 2023). R&D funding and milestone payments are denominated in U.S. dollars.

[THIS PAGE INTENTIONALLY LEFT BLANK]



 4/13/2023 Letter Continued (Full PDF)