IS TREATED INVESTOR PRESENTATION June 2019 Non Confidential - - PowerPoint PPT Presentation

Non Confidential

REDEFINING HOW KIDNEY DISEASE IS TREATED

INVESTOR PRESENTATION

June 2019

This document contains forward-looking information pursuant to applicable securities law. All information that addresses activities or developments that XORTX expects to occur in the future are forward-looking statements. Forward-looking statements are based on the estimates and opinions of management on the date the statements are made. However, they should not be regarded as a representation that any of the plans or objectives will be achieved as actual results may differ materially from those expressed or implied by the forward-looking information set forth in this document due to risks and uncertainties affecting XORTX, including access to capital, the successful completion of clinical trials and receipt of all regulatory approvals. The forward-looking statements in this document are based on a number of assumptions which may prove to be incorrect, including assumptions concerning general business and economic conditions, positive clinical trials and the availability of financing. XORTX assumes no responsibility to update forward-looking statements in this document.

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FORWARD LOOKING STATEMENTS

KEY HIGHLIGHTS

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XORTX Clinical development stage products target uric acid lowering, which has been shown to have an important clinical effect. Significant global market opportunities.

Developing clinical stage assets to treat kidney disease.

Two lead products in development with strong IP and established proof of concept. XRx-008 for Autosomal Dominant Polycystic Kidney Disease (ADPKD)- Orphan Market. XRx-221 for type 2 Diabetic Nephropathy ( T2DN) – Large Market

Two Proprietary Products

Co-development deal with Teijin Pharma will announce U.S. Phase 2 study of Uric Acid Lowering in type 2 Diabetic Nephropathy Patients; Topline Phase 2a data readout - August 2019.

Phase 2a clinical data readout within 12 months

Expected initiation of a pivotal registration study in Polycystic Kidney Disease within 12 months. (potentially under an SPA).

Orphan drug

• pportunity in

polycystic kidney disease.

XORTX’ Senior team was responsible for oxypurinol and vernakalant development at Cardiome Pharma.

Experienced Management Team

Uric Acid (UA): a Bad Actor in Kidney Disease

Lowering Uric Acid Protects Kidney Health, in human clinical trials.

Endothelial NO Depletion Oxidative Stress Activation Renin Angiotensin System Systemic Inflammation

High Blood Pressure Vascular Damage Fibrosis Kidney Inflammation Proteinuria Decline of Filtering Capacity Normalized Blood Pressure Decreased Proteinuria Decrease and Reversal of Decline in Filtering Capacity HIGH UA LEVELS PREDICT Diabetic Nephropathy

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Decreasing Uric Acid levels in Diabetes Patients may delay progression to End Stage Renal Disease ( ESRD)

ESRD – A Life Altering Event

• 4 hours per day on dialysis
• Loss of ability to work full time
• Dependence on family
• Pain and declining health are constant burden
• Shortened survival – only 50% of patients survive

two years

• Uric acid hastens loss of

filtering capacity of kidneys

• A therapy that maintains and

extend kidney health can redefine kidney disease treatment in the future.

• Diabetic Nephropathy - No

drugs are available to treat progressive kidney disease due to uric acid injury.

Source: Curr Opin Nephrol Hypertens – 22(2): 185-192, 2013

5 XORTX Therapies are designed to delay or reverse progression of kidney disease, to prevent ESRD

A Strong Patent Portfolio Covers Uric Acid Lowering Agents Use in Progressive Kidney Disease

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Patent Claims Term

US 9,155,740 Method of Use Claims Covering Uric Acid Lowering Agents (Xanthine Oxidase Inhibitors) in the Treatment of “Diabetic Nephropathy” 2025 (Est. GATT extension -4-5 yrs) PCT/US14/30292 Formulations Patent Covering Xanthine Oxidase Inhibitors: specifically for oxypurinol (XRx-008) 2034 PCT/JP2014/05/2154 PCT/JP2014/05/9912 PCT/JP2015/07/1530 Composition of matter for XRx-221 (TMX-049) 2034 PCT/JP2015/07/2153 PCT/JP2017/04/2429 Use Patent for XRx-221 (TMX-049) in Kidney Disease 2037

Note: Orphan Exclusivity adds to product protection in Autosomal Dominant Polycystic Kidney Disease (ADPKD)

Competitive Landscape Analysis & Well differentiated Compared to Landscape

CLASS IP ADVANTAGES LIMITATIONS Uricosurics Varied Decrease uric acid absorption/ reuptake Inappropriate: Increase kidney stone formation Uricase Off Patent Acute IV use Cannot be used chronically Xanthine Oxidase Inhibitors Allopurinol Off Patent Decreases UA production and serum uric acid ~2-3 mg/dL. Well Characterized Acceptable side effect profile Only approved for GOUT Only works well in ~28% of individuals Modest effect (~2-3 mg/dL) Side effects: Rash, Liver Enzymes, Kidney Febuxostat 2019 Higher Potency -decreases UA production and serum uric acid ~2-6 mg/dL. Only approved for GOUT and Cancer * Recent FDA Boxed Warning Oxypurinol (free acid) 2034 Decreases UA production ~2-3 mg/dL Improved tolerability Modest effect Poor Bioavailability XRx-008 2034 Decreases UA production ~2-3 mg/dL Improved tolerability 3X increase in Bioavailability

Comparable efficacy to allopurinol

XRx-221 (TMX-049) 2034, 2037 High Potency (~3-6 mg/dL) Improved tolerability Clean Safety Profile None observed to date

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Current Agents are Ineffective at Best

Two Significant Market Opportunities

Progressive Kidney Disease

~10,000,000 Individuals

~100,000,000 Individuals

U.S. Worldwide

XRx-221 in T2DN XRx-008 in (ADPDK) DK)

~150,000 Individuals ~1,500,000 Individuals

U.S. Worldwide

Opportu tunity ty #1: Orphan Disease - PhIII Opportu tunity ty #2: Diabeti etic Kidney ey Disea ease e – Ph Ph II II

Registration Study Initiation

2020

Phase 3 - Data Readout

2022

Phase 2a Topline August 2019 Phase 2b Initiation 2020 Phase 3a & 3b Topline August 2025 & 26 U.S. Market Approval 2027

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U.S. Marketing Approval

2023/4 Estimated Peak Sales – USA →$1.8 B/yr Worldwide → $4 B/yr Estimated Peak Sales – USA →$2.4 B/yr Worldwide → $5 B/yr

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XRx-008: A Novel Formulation of Oxypurinol

• XRx-008 - a proprietary formulation of Oxypurinol with 3X increased bioavailability – Wholly owned by

XORTX Therapeutics Inc. and developed “In-house”

• Increased tolerability increases compliance and supports chronic dosing
• Increased bioavailability increases oral dosing range
• Independent Phase 2 clinical trials show Oxypurinol Lowers uric acid, Improves vascular function
• Negotiating Phase III Registration Trial with FDA and Company also intends to seek Special Protocol

Assessment

• XRX-008 - pre-IND work and FDA Investigational New Drug application (IND) meeting completed,

Orphan Drug Designation ( ODD) application initiated.

• Orphan Drug Classification: ~120,000 U.S. patients

XRx-008 in Polycystic tic Kidney Diseas ase – (PKD)

XRx-008: Autosomal Dominant Polycystic Kidney Disease (ADPKD)

Development Timeline: ** Planning to Initiate Pivotal Study under SPA in first half of 2020 **

GMP Mfg. (9 months) Finalize IND Finalize ODD BA Study Protocol/SPA Ph III Ph3 Pivotal Study under SPA - (30 months) NDA filing (Accelerated Review) Marketing Approval

2019 2020 2021 2022 2023 2024 11

GMP – Good Manufacturing Process Standards IND- Investigational New Drug ODD- Orphan Drug Designation BA – Bio-availablity Study in Man SPA – Special Protocol Assessment NDA – New Drug Application for marketing

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XRx-221 (TMX-049) to treat Progressive Diabetic Kidney Disease

XRx-221 - a proprietary “next generation” Xanthine OxidoReductase Inhibitor

• Type 2 Diabetic Nephropathy (T2DN)
• High Potency inhibits production of uric acid, thus decreasing and maintaining SUA levels at low-normal

target range

• Reduced metabolism suggests excellent tolerability
• Excellent Clinical efficacy and safety record in >150 patients
• Phase 2a T2DN study topline results due August 2019 –UACR 1’ endpoint (Under US FDA IND)
• Co-Development Agreement between XORTX and Teijin for Global Rights
• “Next Generation” -Xanthine OxidoReductase Inhibitor - Phase 2b ready asset under XORTX’s DN

patent (except Japan)

XRx-221 (TMX-049) Development Timeline

Development Timeline:

I---Phase 2a-- ---I Phase 2a results Phase 2b Proof of Concept- (400 patients) DDI Study FDA Meeting End of Ph2b

2019 2019 2020 2020 2021 2021 2022 2022 2023 2023 2025 2025

**Pilot Adolescent Study I-------Phase 3a Pivotal Study - (1200 patients) I--------Phase 3b Pivotal Study (1200 pts)----------I Pilot results

2024 2024

Pilot results may Permit early NDA Filing NDA Filing 2025 Ph2b results

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DDI – Drug Drug Interaction Study NDA – New Drug Application for marketing

QT/QTc (if necessary)

CAPITAL STRUCTURE

Market Capitalization ~$15 million Common Shares Outstanding 62,919,691 Warrants 4,004,740 Options 2,674,000 Fully-diluted Shares Outstanding 69,598,431 Public Listings XRX : CSE | XRTXF : OTCQB Longer term plan for NASDAQ listing Description of Shares Held: Mgmt & Insiders → 26% Angels → 29% Institutional → 2% ~54/63 Million shares closely held & estimated free trading float ~ 7M shares

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Action Item Plan for Value Creation/ Recognition

2018/2019:

Budget Focus on Program Value Creation… 1/Advanced & Accelerated ADPKD program with FDA 2/Type 2 Diabetic Nephropathy with Teijin Pharma – *Next Gen molecule, *XORTX – Custodian of TMX-049 *VALIDATION of XORTX path. TODAY XORTX is a Company with: A phase 3 program in ADPKD & A phase 2 program in T2DN provide HUGE valuation, albeit currently unrecognized.

2019/2020:

Budget Focus on…Raise $5M 1/ IR → NA, EU, US Roadshows and Market makers 2/ NASDAQ → RTO (Ongoing) → Uplisting 3/ ADPKD → Manufacture XRx-008, → Regulatory Filings → BA study 4/ T2DN → Mfg → Phase 2a Announcement ( Aug 2019) → Phase 2 b initiation

TRANSITION Value Creation Value Recognition

Lead Program Status Market Cap Products Arena ( ARNA) Phase 2 $ 2.11 B None Akebia Phase 3 (4 readouts) $728.21 M FDA approved Auryxia Allena Pre-Phase 3 $200 M None Diamedica Phase 2 $45 M None DaVita Revenue Dialysis $9.16 B Yes Keryx Acquired by AKEBIA $750M valuation See Akebia Reata Phase 3 (3) Phase 3 $2.11 B Alport Syndrome (CKD) Bardoxalone ADPKD Rockewell Medical (RTMI) Triferic – Fe supplement $183 M Yes Tricida +ve Phase 3: Pre-NDA $1B None

Comparable pre-phase 3 NASDAQ traded companies:

Why Invest?

Scarce Assets Addressing a Large Market Opportunity Strong Intellectual Property Portfolio Initial Data Strongly Positions the Company For Clinical Success Important interim data readouts Experienced Management Team With Significant Expertise in Drug Development

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Non Confidential

INVESTOR PRESENTATION Contact Information:

• Dr. Allen Davidoff

adavidoff@xortx.com 1-403-455-7727

Non Confidential

INVESTOR PRESENTATION

APPENDIX

XRx-008: Uric acid lowering in ADPKD provides clinically meaningful benefit.

(Han M, et al., Hyperuricemia and Deterioration of Renal function in ADPKD, BMC Nephrol 15:63-2014) (n=32)

• 9
• 9
• 7
• 7
• 5
• 5
• 3
• 3
• 1
• 1

1 3 5 7

e-GFR chang nge (ml/mi min/ n/1.73m^ m^2)

Time (yrs)

eGFR (ml/mi min/ n/1.73m^ m^2/yr)

PreTx (-1yr) Post Tx (1yr)

• 5
• 5
• 4
• 4
• 3
• 3
• 2
• 2
• 1
• 1

1 2

Change in Serum um Uric Acid (mg/dL)

Time (yrs)

Serum um Uric Acid ( mg/dL)

PreTx (-1yr) Post Tx (1yr)

p=0.001 p=0.001

Higher SUA is associated with increased kidney volumes, increased End Stage Renal Disease (ESRD), and ADPKD disease progression. (Helal, 2013) Serum uric acid (SUA) concentrations are higher in APDKD patients than controls. (Mejias et al. Hyperuricemia, gout, and

autosomal dominant polycystic kidney disease. Am J Med Sci 1989; 297: 145–148)

Decreasing uric acid in ADPKD patients reverses the rate of glomerular filtration rate decline. ( Han et al.)

Increased SUA is strongly associated with endothelial dysfunction (ED) via decreased nitric oxide bioavailability.

( Khosla, 2005, Zoccali 2006, Kurowska 2002, Portaluppi 2004).

In early stage ADPKD patients, uric acid levels (p<0.001) and eGFR (p<0.001) predict ED. (Kocygit et al. Clinical Practice, Nephron Clin

Pract 123:157-164, 2013.)

Losing ~ -4.5 (ml/min/year) Gains ~ +2.2 (ml/min/year)

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Exceeds FDA improvement necessary for approval !

Goicoechea et al. (2010) Effect of allopurinol in CKD progression and CV risk. Clin J Am Soc Nephrol 5:1388-1393 (n=57,56)

Post Tx Pre Tx (2yrs) (-1yr) Post Tx PreTx (2yrs) (-1yr)

SUA SUA

GFR – Rate Decline GFR –Rate Decline

Dialysis Dialysis Renal Events Renal Events

• 1
• 15
• 1
• 10
• 5
• 5

5 10 10 15 15 20 20 25 25 UnTr Treat ated Tr Treat ated

Goicoechea et al. (2015) Allopurinol and Progression of CKD and Cardiovascular Events: A long-term Follow-up, Am J Kid Dis

Effects of SUA lowering on CKD - DURABILITY after Seven Years

~-70% ~-50%

7 yrs. Tx. Decreasing serum uric acid in T2DN patients has the potential to halve the number of individual who need dialysis! Recent Phase 2 Clinical Trial Success in progressive kidney disease increases the probability for translational success of this program

XRx-221 (TMX-049) - Type 2 Diabetic Nephropathy ( T2DN)

Chronic Kidney Disease (2-yrs)

( ~50% diabetic patients) (p=0.000) (p=0.018)

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• Dr. Allen W. Davidoff,

Ph.D.

James Fairbairn, CPA,

ICD.D

• Dr. Alan Moore,

Ph.D.

Brian Mangal Co-founder, CEO CFO Co-founder, Senior Clinical and Regulatory Consultant Director, Business Development

• 15 years drug development

experience focused on clinical and regulatory program development as senior management in pharmaceutical R&D (two IND applications, two phase 1 studies, seven phase 2 studies, and one NDA

• Former Chief Scientific

Officer, VP Product Development/ co-founder

• f Stem Cell Therapeutics
• Corp. (now Trillium TRIL:

NASDAQ and TSX) and Senior Scientist and Head

• f Pharmacology,

Cardiome Pharma Corp.

• 20+ years in senior finance

roles with emerging

• companies. He is a

Chartered Professional Accountant, having

• btained his CPA

designation in 1987 and is an Institute-certified

• Director. James Fairbairn

holds a Bachelor of Arts from the University of Western Ontario. He is a director of several junior listed companies.

• Extensive clinical

development experience and 23 years of senior management experience in pharmaceutical R&D. During his esteemed career, he has completed 11 investigational new drug (“IND”) applications

• r supplemental IND’s, 15

phase 1 studies, 12 phase 2 studies, 7 phase 3 studies and two new drug

• applications. Most

recently CEO

• f BetaStem Inc.
• 15 years of clinical

development experience was former Director of Biostatistics for Cardiome Pharma Corp, Led Biotmetrix of Cardiome’s clinical programs. Clinical development experience includes design, analysis and reporting on over 50 clinical trials, three FDA submissions, one TPD submission, a successful EMEA submission. Prior to Cardiome, Bostatistician at Pharmacia/Pfizer, worked on the successful NDA for Linezolid and numerous successful trials with Celecoxib.

MANAGEMENT TEAM

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BOARD OF DIRECTORS

• W. Bruce Rowlands – Chairman, Audit Committee Member
• Biotechnology and investment banking background
• Former Senior VP

, Lorus Therapeutics, a leading Canadian biotechnology company and VP and Director, Dominick and Dominick Securities Canada

• Former Chairman and CEO, Eurocontrol Technics Group Inc., a TSX Venture Exchange listed company

Allen W. Davidoff, Ph.D. - Co-founder, CEO Bruce Cousins – Director, Audit Committee Member

• Accomplished biopharma industry senior finance and operations executive with experience spanning small, early

stage growth to large, international companies

• Significant public company experience, both TSX and NASDAQ as well as extensive financing and M&A experience
• Former Executive VP and CFO Arbutus Biopharma Corporation, a Nasdaq listed biotech company and Aspreva

Pharmaceutical Inc. and Worldwide Finance Director, Johnson & Johnson Paul van Damme – Director, Audit Committee Chair

• Extensive career in industry and finance including senior positions with a number of Canadian and US public

companies

• Biotech industry focus through experience with GlycoDesign, Allelix Pharmaceuticals Inc. including participating in

the sale of Allelix to NPS Pharmaceuticals, Inc.

• Currently Managing Director, WCM Capital, Director, OncoQuest Inc. and CFO, Structural Genomics Consortium

Allan Williams – Director

• 30+ years capital market and public company experience including being instrumental in raising over $250 million

in project capital

• Extensive mergers and acquisitions experience
• Current director, Greatbanks Resources Inc., Maritime Resources Corp., both TSX Venture listed companies and

True Grit Resources Inc., a NEX listed company

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ADVISORY BOARD

• Dr. Petter Bjornstad, MD
• Clinical Researcher and Assistant Professor of Pediatrics and Medicine, University of Colorado School of Medicine
• NIH and NDRF funded translational research with a track record of research potential and success
• Authored over 70 peer reviewed manuscripts and several high impact journals
• Principal investigator of several ongoing studies related to kidney disease and diabetes
• Dr. Richard J. Johnson Jr., MD
• Tomas Berl Professor, Division of Renal Diseases and Hypertension, University of Colorado School of Medicine,

Anschutz Medical Campus

• Dr. Federico Maese, MD
• Cardiologist and Clinical Researcher focused on preventative cardiology and prevention of coronary artery

disease

• Extensive clinical experience in the management of diabetic patients with insulin resistance, metabolic

syndrome and extensive inflammation

• Dr. Henk E. D. J. ter Keurs, MD, Ph.D.
• Cardiologist, LIBIN Cardiovascular Institute of Alberta

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Individuals with Diabetes have kidneys sensitive to high “normal” or high serum uric acid, indicating enhanced risk of kidney disease. XRx-221 (TMX-049) is a novel, highly potent uric acid lowering agent that can decrease and maintain uric acid, and has the potential to provide benefit to patients with T2-DN.

Q1< 3.2 mg/dL Q2= 4.4 mg/dL Q3 =5.0 mg/dL Q4 > 6.2 mg/dL

NORMAL Range HIGH Range

(n=1449)

XRx-221 (TMX-049)

Uric Acid Levels are Highly Correlated to Progression of Kidney Disease.

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2

XRx-221 (TMX-049) - Type 2 Diabetic Nephropathy ( T2DN)

(n=20,20) (p=0.02) (p=0.049)

Momeni A, Effect of Allopurinol on Decreasing Proteinuria in Type 2 Diabetic Patients, Int J Kid Dis, 4(128), 2010

Decreasing serum uric acid in T2DN patients substantially decreases proteinuria inpatients with T2DN. 13