Processa Pharmaceuticals, Inc. (PCSA) Initiation Report

October 28, 2020 Processa Pharmaceuticals, Inc. Page 13 of 16 ALPHA SELECT LIST Institutional Research Figure 19: Balance Sheet Statement 2017A 2018A 2019A 2020E 2021E 2022E Balance Sheet Statement (USD in 000s) Total assets 2,982.9 15,014.6 12,002.4 23,645.7 33,287.1 27,176.6 Total current assets 2,951.6 2,020.4 1,007.1 14,278.4 23,987.1 17,943.9 Cash 2,847.4 1,741.0 691.5 14,154.2 23,862.9 17,819.7 Accounts receivable 62.7 21.6 - 26.5 26.5 26.5 Prepaid expenses and Other 41.4 257.8 315.6 97.7 97.7 97.7 Total non-current assets 31.4 12,994.3 10,995.3 9,367.3 9,300.0 9,232.7 Property and equipment 25.8 17.4 228.0 117.0 49.7 (17.6) Intangible assets - 10,437.8 9,642.5 9,244.8 9,244.8 9,244.8 Other assets 5.5 2,539.1 1,124.8 5.5 5.5 5.5 Total liabilities and equity 2,982.9 15,014.6 12,002.4 23,645.7 33,287.1 27,176.6 Total liabilities 2,609.8 3,513.6 3,989.9 2,755.7 2,753.8 2,752.0 Total current liabilities 2,599.8 645.7 1,191.6 449.1 447.2 445.4 Accounts payable and accrued liabilities 50.7 292.1 75.6 73.4 68.8 64.3 ST Debt + Current Portion of LT Debt 2,448.6 230.0 880.5 - - - Other current liabilities 100.6 123.6 235.5 375.7 378.4 381.0 Total non-current liabilities 10.0 2,867.9 2,798.3 2,306.6 2,306.6 2,306.6 Convertible notes payable, net - - - 623.6 623.6 623.6 Long-term debt, net - - 147.4 204.9 204.9 204.9 Accrued interest - - - 162.5 162.5 162.5 Other liabilities 10.0 2,867.9 2,650.9 1,315.7 1,315.7 1,315.7 Total shareholders' equity 373.2 11,501.0 8,012.6 20,890.0 30,533.2 24,424.6 Preferred stock - - - - - - Common equity 3.5 3.9 0.5 5.3 7.2 7.2 Additional paid-in-capital 4,228.7 19,121.3 18,994.0 36,310.2 52,332.6 53,356.7 Deficit (3,859.1) (7,624.1) (10,982.0) (15,425.6) (21,806.5) (28,939.4) Source: Company Reports and Craig-Hallum Estimates MANAGEMENT TEAM David Young, Pharm.D., Ph.D., CEO. Dr. Young has over 30 years of pharmaceutical research, drug development, and corporate experience. He was a Founder and CEO of Promet Therapeutics, LLC since its formation in August 2015. Dr. Young was Chief Scientific Officer of Questcor Pharmaceuticals from 2009-2014 and was responsible for working with the FDA on modernizing the Acthar Gel label and in obtaining FDA approval in Infantile Spasms. From 2006-2009 prior to joining the executive management team, Dr. Young served as an independent Director on the Questcor Board of Directors. During the eight years that Dr. Young was involved with Questcor, Questcor transitioned to an orphan drug specialty pharmaceutical company, moving from near bankruptcy in 2007 to a valuation of approximately $5.6 billion in 2014. Dr. Young has also served as Executive Director & President, U.S. Operations of AGI Therapeutics plc, Executive Vice President of the Strategic Drug Development Division of ICON plc, an international CRO, and was Founder and CEO of GloboMax LLC, a CRO specializing in FDA drug development (acquired by ICON plc in 2003). Dr. Young is an expert in small molecule and protein non-clinical and clinical drug development having served on FDA Advisory Committees, taught FDA reviewers as part of a UMAB-FDA contract, has served on NIH grant review committees, and was Co-Principal Investigator on a National Cancer Institute contract to evaluate new oncology drugs. Dr. Young has met more than 100 times with the FDA on more than 50 drug products and has been a key team member on more than 30 NDA/supplemental NDA approvals. Dr. Young has more than 150 presentations-authored publications-book chapters, including formal presentations to the FDA, FDA Advisory Committees, and numerous invited presentations at both scientific and investment meetings. Dr. Young received his B.S. in Physiology from the University of California at Berkeley, his M.S. in Medical Physics from the University of Wisconsin at Madison, and his Pharm.D.-Ph.D. with emphasis in Pharmacokinetics and Pharmaceutical Sciences from the University of Southern California.