BenevolentAI provides an update on its business priorities

London, UK, 23 April 2024: BenevolentAI (“BenevolentAI” or the “Company”) (Euronext Amsterdam: BAI), a leader in applying advanced AI to accelerate biopharma drug discovery, today announces an update on its business priorities.

• Going forward the Company will focus on its AI-driven drug discovery collaboration and proprietary pipeline revenue generating pillars, following recent successes in these areas. The Board believes this focus will likely bring the greatest potential return for shareholders.
• Following completion of the market assessment of its Knowledge Exploration Tools, as noted at the time of the Company’s full year results on 14 March 2024, work on the Knowledge Exploration Tools will cease, given the investment needed to fully commercialise this SaaS product and the estimated timeframe to see a potential meaningful financial return.
• The impact of these changes will be a reduction in headcount by c.30%, with cash burn reduced by c.20%, extending the Company’s cash runway to late Q3 25, even after partial reinvestment of the savings into Phase Ib/IIa enabling studies for lead asset BEN-8744, following positive results from the Phase Ia trial.

Since September 2023, the Company has made significant operational progress on multiple fronts, including signing the collaboration with Merck KGaA with a potential $594m in revenue generation, and announcing positive top line Phase Ia data on its lead asset BEN-8744 for the treatment of ulcerative colitis (UC), as well as making significant changes to strengthen its Executive Leadership Team.

The Company had communicated in March 2024 that a current market assessment was underway of its Knowledge Exploration Tools that would determine if, or how, this opportunity complemented its wider commercial strategy. Following completion of this assessment, which took into account the level of further investment needed to successfully commercialise these tools as well as the timeframe within which a meaningful financial return could be expected, the Company has concluded that resources allocated to the development of these tools would be better utilised focusing on the Company’s two other revenue pillars, following on from recent successes in its AI driven drug discovery collaboration and proprietary pipeline pillars.

As part of this evaluation of business priorities the overall headcount of the Company has been reviewed and following the decisions announced today, it is proposed that headcount will be reduced by around 30% and headcount is expected to end the year at c.180. Importantly, key skills, experience and capabilities have been retained and these reductions maintain the Company’s ability to execute on existing, or sign new, collaborations and continue to develop its core pipeline programmes. Additionally, the Company will close its US office. It is imperative for the operational effectiveness of the Company to have strong integration between its technology and scientific teams, and management believes this can be best achieved over its two largest sites in London and Cambridge, UK.

While investment will continue to be made into the Company’s pipeline programmes and development of the BenevolentAI Platform^TM, the amended business priorities outlined above will result in a reduced cash burn of c.20% which will extend the Company’s cash runway to late Q3 2025. The Company will continue to explore all opportunities to fund the cash runway gap to year end 2025, at which time further larger milestones are expected to be received from existing partner programmes. These opportunities include potentially signing new drug discovery collaborations and out-licensing of the Company’s proprietary pipeline assets, where ongoing discussions with third parties are making good progress. The Company remains committed to its previous guidance of signing at least one new collaboration and out-licensing at least one of its pipeline assets during 2024. The Company will also continue to investigate a broad range of options to expand its shareholder base and also improve liquidity in its shares.

Dr. Joerg Moeller, Chief Executive Officer of BenevolentAI, said: “While these situations are always difficult, as a company we have a duty to our shareholders to optimise capital allocation in the areas where we believe the potential return is the greatest. BenevolentAI is an AI augmented drug discovery company uniting science and technology with the aim to develop life-changing medicines for patients. Therefore, I believe that focusing our organisation on furthering our drug discovery collaborations and progressing our proprietary pipeline is the best way to achieve both the goal, of delivering value creation for our shareholders and delivering innovative medicines to patients suffering from very serious medical conditions.”

Public disclosure of inside information in accordance with article 17(1) of the Regulation (EU) No 596/2014 on market abuse (Market Abuse Regulation)