Ayala Pharmaceuticals, Inc. (Nasdaq: AYLA), a clinical-stage oncology company focused on developing and commercializing small molecule therapeutics for patients suffering from rare tumors and aggressive cancers today announces updated, positive interim results from Part A of the ongoing RINGSIDE Pivotal Phase 2/3 clinical trial evaluating investigational new drug AL102 in desmoid tumors. AL102 is a potent, selective, oral gamma-secretase inhibitor. The data are being featured in an oral presentation today at the European Society for Medical Oncology (ESMO) Congress 2022. The presentation entitled, “Initial Results of Phase 2/3 Trial of AL102 for Treatment of Desmoid Tumors” is being delivered by Prof. Robin Jones, M.D., Head of the Sarcoma Unit at The Royal Marsden, London, UK. “The results presented at ESMO from the RINGSIDE study are very encouraging. AL102 demonstrated an early and meaningful effect on tumors within a 16-week period and was well tolerated, which could allow for long term treatment of patients. AL102 has the potential to significantly improve the lives of patients suffering from desmoid tumors who currently have no approved therapy,” said Prof. Robin Jones. Jeanne Whiting, Executive Director & Co-Founder of the Desmoid Tumor Research Foundation stated, “Desmoid tumors are rare, connective tissue tumors that can have aggressive infiltrative growth and high risk of local recurrence. Patients and physicians struggle with the fact that there are no FDA-approved therapies. We are very encouraged by the results presented by Ayala and the opportunity that AL102 holds in improving outcomes for patients with this rare condition.” “We are excited to share strong interim results from the AL102 RINGSIDE study at this year’s ESMO Congress which continue to demonstrate early and meaningful anti-tumor activity as monotherapy in patients with desmoid tumors,” said Roni Mamluk, Ph.D., Chief Executive Officer of Ayala. “Efficacy was demonstrated across all cohorts of Part A of the study, with early responses that deepened over time. The results also showed that AL102 was well-tolerated across all doses. We are advancing to Part B of RINGSIDE with a selected dose of 1.2mg once daily, as well as enrolling patients in the open label extension study. The results presented today give us increased confidence in the potential for AL102 to improve the lives of patients with desmoid tumors.” Results as of the Cut-Off Date of July 14, 2022 Part A Interim Efficacy Results: • Patient enrollment in Part A of RINGSIDE was completed in February 2022. Patients were dosed in AL102 monotherapy cohorts of 1.2mg (once daily), 2mg (2 days on, 5 days off), or 4mg (2 days on, 5 days off). • The activity of AL102 is being evaluated by change in tumor volume (central MRI readings) and response (per RECIST 1.1) determined by blinded independent central review. At data cut, 28 patients were evaluable for tumor volume and 29 were evaluable for RECIST with a scan at base line and at least one additional scan at week 16. • 12 subjects had follow up MRI scans at week 28 and one patient had a scan at week 40. • One patient had a partial response (PR) per RECIST at week 16, confirmed at week 28. • Three additional unconfirmed PRs were observed, two at week 28 and one at week 40. • Continuous tumor volume reduction was observed over time in all patients that underwent 2 or more MRI scans. Part A Interim Efficacy Results of Selected Dose of 1.2mg daily: • At week 16 there were 9 evaluable patients for RECIST in the selected dose of 1.2mg once daily with one PR observed, confirmed at week 28. The remaining 8 patients had stable disease, of which 7 patients had a tumor reduction. • At week 28 there were three patients evaluable for RECIST in the selected dose of 1.2mg daily with one confirmed and one unconfirmed PR and one stable disease with all patients showing tumor reduction and deepening of tumor shrinkage since previous scan. • At the selected dose of 1.2mg once daily, at week 16 there were 9 evaluable patients for volume change with 7 patients experiencing tumor volume reduction. At week 28 there were three evaluable patients for volume change in the selected dose of 1.2mg once daily with all three patients experiencing continuous tumor shrinkage. Part A Safety: • AL102 was generally well tolerated at all doses • Most adverse events were grade 1 or 2 and included mainly diarrhea • No grade 4 or 5 events were observed and low rates of grade 3 events. • At the selected dose (1.2 mg once daily) 3 out of the 14 patients (21.4%) had grade 3 events. • Ovarian dysfunction was observed in about 22% of women with childbearing potential (N=23)