[caption id="attachment_9277" align="aligncenter" width="747"] Press Release[/caption]

Astellas Obtains the Exclusive Rights to Develop and Commercialize FX-322 in Ex-US Markets; Frequency Retains U.S. Rights

Frequency will Receive $80 Million Upfront from Astellas with the Potential of up to $545 Million in Future Milestone Payments as well as Double-Digit Royalties

TOKYO and WOBURN, Mass., July 17, 2019?- Astellas Pharma Inc. (TSE: 4503, President and CEO: Kenji Yasukawa, Ph.D., ?Astellas? ) and Frequency Therapeutics, Inc. (CEO: David Lucchino, ?Frequency?) today announced that they have entered into an exclusive license agreement to develop and commercialize Frequency?s regenerative therapeutic candidate, FX-322, for the treatment of sensorineural hearing loss, the most common type of hearing loss. At present, there are no approved therapeutic options for sensorineural hearing loss. Under the terms of the agreement, Astellas will be responsible for the development and commercialization of FX-322 outside of the U.S. and Frequency will be responsible for U.S. development and commercialization. The companies will be jointly responsible for conducting global clinical studies and coordinating commercial launch activities. Frequency will receive an upfront payment of $80 million and may also receive up to an additional $545 million based on development and commercial milestones, as well as royalties on any future product sales in the licensed territory. Frequency recently completed a Phase 1/2 clinical study in the U.S. in which FX-322 was observed to be well-tolerated following a single intratympanic injection, with no serious adverse events. Improvements in hearing function were observed in multiple FX-322 treated patients. Frequency plans to initiate a Phase 2a study in the fourth quarter of 2019. FX-322 is a proprietary combination of small-molecule drugs designed to restore hearing function by activating inner ear progenitor cells already present in the body to induce hair cell regeneration. Sensorineural hearing loss is the result of damage to and/or loss of sensory hair cells in the inner ear. These inner ear hair cells do not spontaneously regenerate once damaged, although progenitor cells capable of regenerating hair cells remain present in the ear in an inactive state. The World Health Organization (WHO) estimates that there are currently more than 800 million adults with hearing loss globally. According to the U.S. National Institutes of Health, approximately 90 percent of those with hearing loss are affected by sensorineural hearing loss. ?FX-322 is a program that focuses on the mechanism of regeneration. Astellas is committed to exploring all types of partnership opportunities to turn cutting-edge science and technological advances into VALUE for patients,? said Naoki Okamura, Representative Director Corporate Executive Vice President, Chief Strategy Officer, Astellas. ?We look forward to further investigating the potential of FX-322 to improve hearing function in patients around the world.? ?Collaborating with Astellas provides us an opportunity to work with a partner that has deep, global clinical development and commercial expertise and shares our focus in pursuing novel regenerative medicines for patients with diseases where there are no therapeutic options,? said David Lucchino, Frequency?s Chief Executive Officer. ?We are excited to collaborate with them to advance FX-322 for patients with sensorineural hearing loss and to further demonstrate the potential of our platform for progenitor cell activation.? Astellas reflected the impact from this agreement in its financial forecasts of the current fiscal year ending March 31, 2020.