Graft Polymer Regulatory News (GPL)

25 January 2022

Graft Polymer (UK) Plc

("Graft Polymer", the "Company", and together with its subsidiaries, the "Group")

Business Update

Graft Polymer (UK) Plc (LSE: GPL), a business focused on the development of polymer modification, bio/food supplements and drug delivery systems, is pleased to provide the following update on three key areas of the business: Commercial trials with customers are progressing well and leading to order requests. patents and the development of Graft Polymer's layered IP strategy continue to be strengthened; and operational progress against the wider product development has been expertly executed.

Ongoing commercial trials

In 2021, Graft Polymer was involved in successful and exciting trials with leading companies across Europe and internationally. Presently, the trials are at various stages, with some having already resulted in commercial order requests. It is expected that the number of orders will increase during 2022-2023, some leading to further partnerships and others moving into the next stage of the trial.

Graft Polymer's innovative technology is proving to be successful across a wide range of the products in the Company's portfolio. The markets in which Graft Polymer operates are significant in size, and rapidly growing. Research and development remain core to its strategy. The successful trials, and positive validation tests, include ten separate polymers from our GRAFTBOND and GRAFTALEN product lines.

Patent Update

Graft Polymer is also pleased to announce that patent No. P-2021106347 has had its application accepted by the Federal Service for Intellectual Property in Russia and the Slovenian Intellectual Property Office. The patent application, which relates to core technologies included in Graft Polymer's proprietary drug delivery system, focuses on smart nanostructured materials to deliver drugs to target sites with the aim of reducing dosage frequency and mitigate the side effects experienced with traditional therapies.

Furthermore, progress has been made with patent application № P-202100024 and has been awarded. The patent covers the super-saturable self-nano emulsifying drug delivery system (SNEDDS) for poorly water-soluble pharmaceutical compositions and method of its preparation. Graft Polymer has five patent applications accepted that are now included in the database of relevant authorities in Europe and Russia and are awaiting award.

Strategy Update

Building from its successful IPO on the 6 January 2022, Graft Polymer has made strong strategic progress and has the following aims:

1) Reduction in in-house manufacturing cost of porous polymer carriers by enhancing Graft Polymer drying capacities: This will enable Graft Polymer to expand the addressable market and to further increase the sales volume;

2) Lower manufacturing cost of Graft Polymer's block copolymers and reactive masterbatches: Graftapor and Graftakit are the Graft Polymer exclusive high value-added products without any current competition in the market;

3) Open a "Hot Ozone/Plasma Modification" module: It will enable Graft Polymer to produce;

a. Grafted Fluoropolymers (PVDF, PTFE, ETFE, PFA etc); and

b. Polymeric Ozonides based on terpenoids and poly-alpha-olefins, products used as initiators in polymerization reactions and pharma multi applications.

Victor Bolduev, Chief Executive Officer of Graft Polymer, commented: "We are very pleased to progress the status of patent P-2021106347 and look forward to adding more patents to our growing IP portfolio. Our technology supporting our Drug Delivery Systems is highly sophisticated and allows us to operate in the important global DDS market which was valued at over USD$25 billion in 2019 and is projected to reach USD$45 billion by 2027.

"We are excited to see Graft Polymers expansion, and the execution of our business strategy being implemented during 2022."

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For more information, please visit https://www.graftpolymer.com or contact:

About Graft Polymer

Graft Polymer is a UK incorporated holding company with an innovative research and manufacturing facility, based in Slovenia. The core business of the Group comprises polymer modification and drug delivery systems developments. Established in 2017, the Group has already introduced more than 50 products to the market.

The Group has developed a proprietary set of polymer modification technologies, which can improve existing products and processing methodologies by enhancing performance, simplifying manufacturing, reducing material consumption, widening the choice of feedstocks, and reducing costs.

In particular, the Group's techniques allow the combination of otherwise incompatible polymers, facilitating the creation of polymer composites engineered at a molecular level, that combine the attractive properties of different input materials. This enables customers to receive a synergism of properties in polymer composites.

The solutions and products offered by the Group are designed to improve performance, reduce raw materials consumption, and enhance the physical characteristic values of finished products or improve or modify their chemical interaction. In the past several years, there has been increased emphasis by the industry as a whole on applications of grafted polymers, which are produced by monomers being covalently bonded and polymerised as side chains onto the main polymer chain (the backbone).

In 2020, the Group launched a new division named GraftBio to develop IP for Bio/Pharma applications. This includes a drug delivery system to support and provide solutions to the market, which had been heavily impacted by the COVID-19 pandemic. The GraftBio division is in the process of obtaining the HACCP certification for its production facility. The Group has developed a set of drug delivery platforms that enable it to licence its DDS platform (IP) to MGC Pharmaceuticals Limited ("MGC"; LSE: MXC) in relation to MGC's CimetrA™ and CannEpil-IL™ products. The Group expects to receive royalty payments resulting from the sale by MGC of CimetrA™ and CannEpil-IL™ products.