• Revenues of €1.3 million associated with a milestone payment from Serum Institute of India Private Ltd.
• Cash position of €12.9 million at December 31, 2016

Genticel (Euronext Paris & Brussels: FR00011790542 – GTCL presents today its 2016 full year results in accordance with International Financial Reporting Standards (IFRS). Genticel's 2016 Annual Financial Report including the Management Report is available on the company website (www.genticel.com - Investors/Financial information section) in French. An English version will be MADE available before mid-March.

Income statement

In 2016, Genticel again recorded revenues from its agreement with Serum Institute of India Ltd (SERUM INSTITUTE) for a total of €1.3 million, resulting mainly from a milestone payment (US$ 1.2 million) as Genticel's proprietary, reengineered adenylate cyclase “GTL003” fulfilled its predetermined objectives in preclinical in vivo experiments.

SERUM INSTITUTE is evaluating the use of Vaxiclase in the development of acellular multivalent combination vaccines against a variety of infectious diseases, including whooping cough. The license agreement, limited to the authorized indications in emerging markets, includes development and sales upfront and milestones payments depending on the criteria defined within the agreement for potentially up to $57 million, as well as single-digit royalties on net sales.

On December 31, 2016, Genticel had an operating loss of €7.4 million compared with a loss of €11.4 million in 2015. This reduction in operating loss is mostly due to:

• a €1.1 million increase in the Company's revenues in 2016 versus 2015;
• the cancellation of €0.7 million of the Company's financial debt, increasing the total indicated under “Research Tax Credit & Subsidies”;
• a €3.7 million reduction in R&D investment (€7.2 million, versus €10.9 million in 2015):
  • a €2.5 million reduction in study and service charges associated with the discontinuation of the GTL001 manufacturing process scaling-up project and expenses relating to its GTL002 program.
  • a €0.6 million reduction in research personnel costs associated with a cut in its workforce.
• A €0.8 million reduction in ‘General & Administration expenses' (resulting from the operating expense-reduction program put in place by Genticel in early 2016) following the announcement of the initial results of the phase 2 clinical trial undertaken on the GTL001 product.

These reductions in expenses were partly offset by one-time restructuring costs (€2.2 million) and €0.2 million of expenses incurred in the preparation of the transaction with Genkyotex, i.e. a total of €2.4 million of non-recurrent expenses.

After taking into account 2016 financial revenues, the 2016 net loss of €7.2 million (vs. €11.2 million in 2015) is consistent with the Company's expectations.

Balance sheet and cash at the end of 2016

Genticel completed 2016 with cash & cash equivalents and liquid investments of €12.9 million consisting of €8.3 million in current financial assets and €4.7 million in cash and cash equivalents.

This cash and liquid investments balance, versus the €21.8 million at the end of 2015, is mostly explained by the cash consumed by the operations in 2016 (€8.2 million). This is fully in line with Genticel's expectations and the expected impact on the Company's burn rate of the restructuring process initiated after the publication of disappointing results obtained in the clinical phase 2 trial on the GTL001 product.

Registration of Document E pertaining to the planned strategic combination between Genticel and Genkyotex

The French financial market authority (Autorité des Marchés Financiers - AMF) has registered under reference number E.17-004 on January 31, 2017 the information document (Document E) drawn up in relation to the planned strategic combination between Genticel and Genkyotex's shareholders announced on December 22, 2016.

Shareholders meeting at 11 am on February 28, 2017

The Genticel Shareholders' Meeting scheduled for 11 am today is primarily to approve the contribution of all Genkyotex shares to Genticel and the issue of new shares by Genticel to Genkyotex's shareholders in remuneration of their contributed shares. Within the framework of the merger, shareholders will notably also be asked to approve certain structural modifications (adoption of a mode of governance with a Board of Directors, change in the Company's name to “Genkyotex”), certain delegations to the Board of Directors and the appointment of new Board members. Today's meeting will not examine Genticel's annual accounts as reported in this press release – these will be submitted to a subsequent Shareholders' Meeting.

About Genticel

Genticel's versatile platform, Vaxiclase, is well suited for the development of various immunotherapies. A partnership on the use of Vaxiclase as an antigen per se (GTL003) has been established with Serum Institute of India Pvt. Ltd. (Serum Institute), the largest producer of vaccine dose worldwide. This agreement covers territories in emerging markets only, and could generate up to $57 million in revenues for Genticel, before royalties on sales. It will enable Serum Institute to develop acellular multivalent combination vaccines against a variety of infectious diseases, including whooping cough. The last preclinical milestone foreseen by the agreement was reached in Novermber 2016, opening the path to formal preclinical testing prior to clinical development and subsequent commercialization.

On 22 December 2016, Genticel signed a contribution agreement with the shareholders of Genkyotex pursuant to which, subject to the approval of today's Genticel Shareholders' Meeting, Genkyotex's shareholders will contribute in kind 100% of the Genkyotex share capital (on a fully diluted basis) to Genticel, which will issue new shares in remuneration for the contribution. Upon completion of the proposed transaction, Genkyotex's shareholders will hold 80% of Genticel's share capital & voting rights (on a non-diluted basis).

Genkyotex is developing a portfolio of NADPH oxidase (NOX) oral small molecule inhibitors, which have therapeutic potential for the treatment of multiple significant clinical indications with substantial unmet need, including fibrosis, inflammatory pain, angiogenesis, cancer growth, and neurodegeneration. Genkyotex is currently developing two clinical stage, first-in-class NOX inhibitors and is conducting research on several other pre-clinical molecules.

For more information, visit us at www.genticel.com

Disclaimer

This press release and the information it contains does not constitute an offer or solicitation to buy, sell or hold Genticel shares in any country. This press release may contain forward-looking statements by the company with respect to its objectives. These statements are based on the current estimates and forecasts of the company's management and are subject to risks and uncertainties such as the company's ability to implement its chosen strategy, customer market trends, changes in technologies and in the company's competitive environment, changes in regulations, clinical or industrial risks and all risks linked to the company's growth. These factors as well as other risks and uncertainties may prevent the company from achieving the objectives outlined in the press release. No guarantee is given on forward-looking statements which are subject to a number of risks, notably those described in the registration document filed with the French Markets Authority (the AMF) on 1 April 2015 under number R.15-015, as updated in the Document E filed with the AMF on 31 January 2017 under number E.17-004, and those linked to changes in economic conditions, the financial markets, or the markets on which Genticel is present. Genticel products are currently used for clinical trials only and are not otherwise available for distribution or sale.

Appendix: detailed financial information 2016

The following financial statements have been prepared in accordance with IFRS, as adopted by the European Union, and are taken from the financial information contained in Genticel's 2016 annual financial report, which can be found on the Company's website, www.genticel.com, in the Investors/Financial information section[1].

IFRS financial statements for the year to December 31, 2016 have been audited by Grant Thornton and Sygnatures.

Statement of Financial Position

Income Statement

Statement of Comprehensive Income

Change in Shareholders' Equity

(1) As part of the strategic merger with Genkyotex, the Company incurred costs amounting to €383K as at 31 December 2016, including €159K premiums in accordance with IAS 32 (see Note 2.3).