Sequana Medical N : Statutory auditor’s report on the consolidated accounts for the year ended 31 December 2023

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STATUTORY AUDITOR'S REPORT TO THE GENERAL SHAREHOLDERS' MEETING SEQUANA MEDICAL NV ON THE CONSOLIDATED ACCOUNTS FOR THE YEAR ENDED

31 DECEMBER 2023

We present to you our statutory auditor's report in the context of our statutory audit of the consolidated accounts of Sequana Medical NV (the "Company") and its subsidiaries (jointly "the Group"). This report includes our report on the consolidated accounts, as well as the other legal and regulatory requirements. This forms part of an integrated whole and is indivisible.

We have been appointed as statutory auditor by the general meeting d.d. 27 May 2021, following the proposal formulated by the board of directors and following the recommendation by the audit committee. Our mandate will expire on the date of the general meeting which will deliberate on the annual accounts for the year ended 31 December 2023. We have performed the statutory audit of the Company's consolidated accounts for 6 consecutive years.

Report on the consolidated accounts

Unqualified opinion

We have performed the statutory audit of the Group's consolidated accounts, which comprise the consolidated statement of financial position as at 31 December 2023, the consolidated income statement, consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies and other explanatory information, characterised by a consolidated balance sheet total of EUR 10.101.034, and a consolidated income statement showing a consolidated loss for the year of EUR 32.563.574.

In our opinion, the consolidated accounts give a true and fair view of the Group's net equity and consolidated financial position as at 31 December 2023, and of its its consolidated financial performance and its consolidated cash flows for the year then ended, in accordance with International Financial Reporting Standards as adopted by the European Union and with the legal and regulatory requirements applicable in Belgium.

Basis for unqualified opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs) as applicable in Belgium. Furthermore, we have applied the International Standards on Auditing as approved by the IAASB which are applicable to the year-end and which are not yet approved at the national level. Our responsibilities under those standards are further described in the "Statutory auditor's responsibilities for the audit of the consolidated accounts" section of our report. We have fulfilled our ethical responsibilities in accordance with the ethical requirements that are relevant to our audit of the consolidated accounts in Belgium, including the requirements related to independence.

We have obtained from the board of directors and Company officials the explanations and information necessary for performing our audit.

PwC Bedrijfsrevisoren BV - PwC Reviseurs d'Entreprises SRL - Financial Assurance Services Maatschappelijke zetel/Siège social: Culliganlaan 5, B-1831 Diegem Vestigingseenheid/Unité d'établissement: Generaal Lemanstraat 67, B-2018 Antwerpen

T: [phone], F: [phone], www.pwc.com

BTW/TVA BE 0429.501.944 / RPR Brussel - RPM Bruxelles / ING BE43 3101 3811 9501 - BIC BBRUBEBB / BELFIUS BE92 0689 0408 8123 - BIC GKCC BEBB

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Material Uncertainty Related to Going Concern

We draw attention to Note 4 in the consolidated accounts, which indicates that the Company is still in the development phase for its alfapump and DSR programs, including the execution of clinical trials and submission / review of applications in order to achieve regulatory marketing approvals for these products. This entails various risks and uncertainties, including but not limited to the uncertainty of the development and regulatory review process and the timing of achieving profitability. The Company's ability to continue operations also depends on its ability to raise additional capital and to refinance existing debt, in order to fund operations and assure the solvency of the Company until revenues reach a level to sustain positive cash flows. The impact of macroeconomic conditions and the geopolitical situation on the Company's ability to secure additional financing rounds or undertake capital market transactions remain unclear at this point in time. The Consolidated Statement of Financial Position as at 31 December 2023 shows negative equity in the amount of EUR 19,5 million and ending cash balance of EUR 2,6 million.

These events or conditions as set forth in Note 4 indicate that a material uncertainty exists that may cast significant doubt on the Group's ability to continue as a going concern. Our opinion is not modified in respect of this matter.

Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the consolidated accounts of the current period. These matters were addressed in the context of our audit of the consolidated accounts as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined there were no other matters to be considered as key audit matters to be communicated in our report, in addition to the matter described in the "Material Uncertainty Related to Going Concern" section.

Responsibilities of the board of directors for the preparation of the consolidated accounts

The board of directors is responsible for the preparation of consolidated accounts that give a true and fair view in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union and with the legal and regulatory requirements applicable in Belgium, and for such internal control as the board of directors determine is necessary to enable the preparation of consolidated accounts that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated accounts, the board of directors is responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the board of directors either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

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Statutory auditor's responsibilities for the audit of the consolidated accounts

Our objectives are to obtain reasonable assurance about whether the consolidated accounts as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated accounts.

In performing our audit, we comply with the legal, regulatory and normative framework applicable to the audit of the consolidated accounts in Belgium. A statutory audit does not provide any assurance as to the Group's future viability nor as to the efficiency or effectiveness of the directors' current or future business management at Group level. Our responsibilities in respect of the use of the going concern basis of accounting by the board of directors' are described below.

As part of an audit in accordance with ISAs, we exercise professional judgement and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidated accounts, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control;
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the board of directors;
• Conclude on the appropriateness of the board of directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our statutory auditor's report to the related disclosures in the consolidated accounts or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our statutory auditor's report. However, future events or conditions may cause the Group to cease to continue as a going concern;
• Evaluate the overall presentation, structure and content of the consolidated accounts, including the disclosures, and whether the consolidated accounts represent the underlying transactions and events in a manner that achieves fair presentation;

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• Obtain sufficient and appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion.

We communicate with the audit committee regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide the audit committee with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with the audit committee, we determine those matters that were of most significance in the audit of the consolidated accounts of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter.

Other legal and regulatory requirements

Responsibilities of the board of directors

The board of directors is responsible for the preparation and the content of the directors' report on the consolidated accounts and the other information included in the annual report on the consolidated accounts.

Statutory auditor's responsibilities

In the context of our engagement and in accordance with the Belgian standard which is complementary to the International Standards on Auditing (ISAs) as applicable in Belgium, our responsibility is to verify, in all material respects, the directors' report on the consolidated accounts and the other information included in the annual report on the consolidated accounts and to report on these matters.

Aspects related to the directors' report on the consolidated accounts

In our opinion, after having performed specific procedures in relation to the directors' report on the consolidated accounts, this directors' report is consistent with the consolidated accounts for the year under audit and is prepared in accordance with article 3:32 of the Companies' and Associations' Code.

In the context of our audit of the consolidated accounts, we are also responsible for considering, in particular based on the knowledge acquired resulting from the audit, whether the directors' report on the consolidated accounts is materially misstated or contains information which is inadequately disclosed or otherwise misleading. In light of the procedures we have performed, there are no material misstatements we have to report to you.

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Statement related to independence

• Our registered audit firm and our network did not provide services which are incompatible with the statutory audit of the consolidated accounts, and our registered audit firm remained independent of the Group in the course of our mandate.
• The fees for additional services which are compatible with the statutory audit of the consolidated accounts referred to in article 3:65 of the Companies' and Associations' Code are correctly disclosed and itemized in the notes to the consolidated accounts.

European Uniform Electronic Format (ESEF)

We have also verified, in accordance with the draft standard on the verification of the compliance of the financial statements with the European Uniform Electronic Format (hereinafter "ESEF"), the compliance of the ESEF format with the regulatory technical standards established by the European Delegate Regulation No. 2019/815 of 17 December 2018 (hereinafter: "Delegated Regulation").

The board of directors is responsible for the preparation, in accordance with ESEF requirements, of the consolidated financial statements in the form of an electronic file in ESEF format (hereinafter "digital consolidated financial statements") included in the annual financial report.

Our responsibility is to obtain sufficient appropriate evidence to conclude that the format and marking language of the digital consolidated financial statements comply in all material respects with the ESEF requirements under the Delegated Regulation.

Since Sequana Medical NV does not prepare digital consolidated financial statements in English we are unable to express an opinion on these. However, we refer to our report on the consolidated financial statements for the year ended 31 December 2023 in Dutch. This contains our opinion on the official Dutch version of the digital consolidated financial statements of Sequana Medical NV which have been prepared in accordance with the ESEF requirements under the Delegated Regulation.

Other statements

This report is consistent with the additional report to the audit committee referred to in article 11 of the Regulation (EU) N° 537/2014.

Antwerp, 19 April 2024

The statutory auditor

PwC Bedrijfsrevisoren BV/PwC Reviseurs d'Entreprises SRL

Represented by

Peter D'hondt

Bedrijfsrevisor/Réviseur d'entreprises

*Acting on behalf of Peter D'hondt BV

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ANNUAL REPORT 2023

OUR STRATEGY & KEY OBJECTIVES	3
SEQUANA MEDICAL AT A GLANCE	4
OUR BUSINESS
	Achievements	6
	Outlook for 2024	9
 Proprietary alfapump® & DSR® technologies	10
 alfapump® in liver disease and cancer	17
 DSR® in heart failure	32
	Investor relations	42
CORPORATE GOVERNANCE	44
 Report of the Board of Directors	44
	Corporate Governance Statement	59
	Remuneration Report	86
FINANCIAL STATEMENTS	100
 Statement of the Board of Directors	100
	Statutory auditor's report	101
	Consolidated Income Statement	106
 Consolidated Statement of Comprehensive Income	107
 Consolidated Statement of Financial Position	108
 Consolidated Statement of Changes in Equity	110
 Consolidated Statement of Cash Flows	111
 Notes to the Consolidated Financial Statements	112

• Condensed Statutory Financial Statements

of Sequana Medical NV

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Disclaimer

This annual report may contain predictions, estimates or other information that might be considered forward-looking statements. Such forward-looking statements are not guarantees of future performance. These forward-looking statements represent the current judgment of Sequana Medical on what the future holds, and are subject to risks and uncertainties that could cause actual results to differ materially. Sequana Medical expressly disclaims any obligation or undertaking to release any updates or revisions to any forward-looking statements in this annual report, except if specifically required to do so by law or regulation. You should not place undue reliance on forward-looking statements, which reflect the opinions of Sequana Medical only as of the date of this annual report. Certain monetary amounts and other figures included in this annual report have been subject to rounding adjustments. Accordingly, any discrepancies in any tables between the totals and the sums of amounts listed are due to rounding.

Regulatory Disclaimers

The alfapump® system is currently not approved in the United States or Canada. In the United States and Canada, the alfapump system is currently under clinical investigation (POSEIDON Trial) and is being studied in adult patients with refractory or recurrent ascites due to liver cirrhosis. DSR® therapy is still in development and it should be noted that any statements regarding safety and efficacy arise from ongoing pre-clinical and clinical investigations which have yet to be completed. There is no link between DSR therapy and ongoing investigations with the alfapump system in Europe, the United States or Canada.

Note: alfapump® and DSR® are registered trademarks.

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OUR STRATEGY & KEY OBJECTIVES

Develop and commercialize innovative treatments for patients with diuretic-resistant fluid overload, focusing on improved clinical outcomes, better quality of life for patients and cost savings for healthcare systems.

• Commercialize alfapump® in North America for the treatment of recurrent and refractory ascites due to liver cirrhosis, using our own specialty salesforce targeting liver transplant centers.
• Develop our proprietary DSR® product as a disease-modifying heart failure drug therapy tackling cardiorenal syndrome and establish a strategic partnership for late-stage clinical development and commercialization.

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SEQUANA MEDICAL AT A GLANCE

We are pioneers in treating fluid overload, a serious and frequent clinical complication in patients with liver disease, heart failure and cancer. These patients can have up to 15 liters of extra fluid in their bodies, causing major medical issues including increased mortality, repeated hospitalizations, severe pain, difficult breathing and restricted mobility that severely impacts their daily life. Although diuretics are standard of care, they become ineffective, untolerable or exacerbate the problem in many patients. There are limited effective treatment options, resulting in poor clinical outcomes, high costs and a major impact on their quality of life. We are seeking to provide innovative treatment options for this large and growing "diuretic-resistant" patient population.

alfapump and DSR are our two proprietary platforms that work with the body to treat diuretic- resistant fluid overload and are protected by our strong intellectual property (IP) portfolio. Our alfapump is a fully implanted medical device that has a proven track record for treatment of recurrent and refractory liver ascites. DSR or Direct Sodium Removal has demonstrated clinical proof-of-concept as a disease-modifying heart failure drug therapy tackling cardiorenal syndrome.

The alfapump, a fully implanted, wirelessly charged device, automatically pumps fluid from the peritoneal cavity into the bladder, where it is naturally eliminated through urination. It is protected by a portfolio of patents granted in the US and Europe and more than 1,000 devices have been implanted to date.

In Europe, the alfapump has received CE mark for the treatment of refractory ascites due to liver cirrhosis and malignant ascites and has been included in key European treatment guidelines. In the US, our key growth market, the alfapump has been granted breakthrough device designation by the Food and Drug Administration (FDA) for the treatment of recurrent or refractory ascites due to liver cirrhosis. Our pivotal POSEIDON study met all primary efficacy endpoints with statistical significance, confirming the strong clinical and commercial profile of the alfapump. The Pre-Market Approval (PMA) application was filed with the US FDA in December 2023 and accepted for substantive review in January 2024, ahead of anticipated timing. We plan to commercialize the alfapump directly in the US, using a specialized in-house sales force targeting 90 liver transplant centers (covering 95% of adult liver transplants). The North American market for the alfapump is estimated at $2.4 billion and forecast to grow at a CAGR of 9%, from over 78,000 patients in 2025, reaching more than 147,000 patients by 2032i, primarily driven by the increasing prevalence of Non-Alcoholic SteatoHepatitis / Metabolic dysfunction-Associated SteatoHepatitis (NASH / MASH).

Fluid accumulation in heart failure patients is caused by the retention of too much sodium. Our DSR therapy uses a proprietary sodium-free dextrose / icodextrin solution administered into the peritoneal cavity to remove excess sodium from the body via diffusion, to which the kidneys respond and eliminate excess free water naturally through urination, leading to reduced fluid overload. Composition of matter and method patents have been granted for DSR therapy in the US, Europe and China.

• Based on US and Canada market assessment conducted by highly experienced international consulting group, forecasting over 147,000 patients with recurrent or refractory ascites in North America by 2032 and a target price of $30,000 per alfapump

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