Annual Report
2021
Contents
Who we are
Highlights
The Xanamem Pipeline
About Xanamem and Cortisol Diseases
Chairman’s Letter
Chief Executive Officer’s Letter
Corporate Strategy
Operating & Financial Review
Board of Directors and Company Secretary
Executive Leadership Team
Directors’ Report
Remuneration Report
Auditor’s Independence Declaration
Financial Report
Directors’ Declaration
Independent Auditor’s Report
Corporate Governance Statement
Shareholder Information
Corporate Directory
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AGM details
Actinogen Medical Limited
ABN: 14 086 778 476
Annual General Meeting
Due to health and safety priorities, community expectations
and COVID-19 restrictions on public gatherings, this year’s
Annual General Meeting will be a virtual meeting.
Date: 10 November 2021
Meeting time and details to be advised.
Actinogen is a neurotherapeutics
developer realising a revolutionary
therapy so neurology patients can
live their best lives
1
Annual Financial Report Highlights
Actinogen’s FY21 achievements have set strong
foundations for the company’s future success
Received Rare Paediatric
Disease Designation
(RPDD) for Xanamem
in Fragile X Syndrome
from US FDA
Demonstrated high levels
of target occupancy in
the brain for Xanamem
daily doses ranging from
5mg to 30mg
Commenced the
XanaMIA Phase 2 study
for Alzheimer’s Disease
Secured new capital
exceeding $10 million to
fund planned clinical trials
Received positive XanaFX
Phase 2 trial design
feedback from US FDA for
Fragile X Syndrome
Appointed highly
credentialled CEO
Dr Steven Gourlay
Appointed Corden
Pharma as scale-up
manufacturer
Strengthened intellectual
property portfolio via two
patent applications filed for
Xanamem to extend patent
life protection until 2040
Appointed key
consultants to drive
strategic projects
2
Actinogen Medical Limited The Xanamem® Pipeline
Diseases to be studied in 2021/2022
Phase 2 Pathway
Outlook
XanaMIA
Mild cognitive
impairment due to
Alzheimer’s Disease
Part A: 10mg, 5mg, Placebo Older Volunteers: cognition
Part B: Patients with MCI due to AD: cognition
& biomarkers
"Big-to-market"
Multiple Phase
2b/3 trials
Anxiety, sleep &
behavioural problems
in Fragile X Syndrome
FDA
Pre-IND
Meeting
XanaFX
Phase 2 trial
"Fast-to-market"
single pivotal
Phase 3
Additional
indication
Review and
finalise
selection of
additional
target
Target indication
Phase 2 trial
Designed
to facilitate
optionality
® Xanamem is a registered trademark of Actinogen Medical Limited.
3
Annual Financial Report About Xanamem and
Cortisol Diseases
Xanamem1 is a unique molecule
Xanamem’s novel mechanism of action sets it apart from
other therapies for neurological diseases. It works by
blocking the excess production of intracellular cortisol – the
stress hormone – through the inhibition of the 11β-HSD1
enzyme inside brain cells. The 11β-HSD1 enzyme is highly
concentrated in the hippocampus and frontal cortex, the
areas of the brain associated with cognitive impairment in
neurological diseases, including Alzheimer’s disease.
In the Company’s recent XanaHES Phase 1 trial, Xanamem
exhibited a statistically significant improvement in attention
and working memory among healthy older volunteers
treated with 20mg Xanamem daily, and recent human target
engagement data for the drug in the brain suggests good
activity of doses as low as 5mg daily. Clinical safety data
has been collected from more than 220 individual patients or
volunteers.
The Company is undertaking a range of Phase 2 studies
evaluating Xanamem in the treatment of cognitive impairment
associated with Alzheimer’s disease, Fragile X syndrome, and
another indication with a strong scientific rationale.
Science & inhibition of
11β-HSD1: the cortisol
hypothesis
Xanamem was developed in response to a large body
of evidence from animals and humans implicating
cortisol, commonly known as the “stress hormone”,
in cognitive decline. While cortisol is produced in
times of physical and mental stress, this response is
normal if temporary. However, if cortisol levels remain
elevated for long periods of time, it is believed to
negatively affect important areas of the brain and
may contribute to the formation of abnormal proteins
associated with Alzheimer’s Disease such as amyloid
beta and tau. Excess brain cortisol is also linked to
Fragile X Syndrome.
1 Xanamem is an investigational product and is not approved for use outside of a clinical trial by the FDA or by any other regulatory authority
4
Actinogen Medical Limited Following the Scientific Evidence
Alzheimer’s Disease
Cortisol is toxic to monkey brain cells1
Cortisol impairs animal cognition2
Cortisol & hippocampal volume/memory3
Higher blood cortisol & cognitive decline4
Higher CSF cortisol & cognitive decline5
11β-HSD1 Alzheimer’s mouse model6
Xanamem & improved human cognition7
Fragile X Syndrome
Elevated blood cortisol in patients8
Elevated cortisol & human symptoms9
Glutamate linked to cortisol response10
FMR1 KO mice show raised cortisol11
Elevated 11β-HSD1 in FXS mouse12
11β-HSD1 Fragile X mouse model13
1 Implant in hippocampus, Sapolsky et al. 1990; increased amyloid proteins, Green
8 Hessl et al. 2002; Wisbeck et al. 2000
et al. 2006
9 Elevated cortisol correlates with symptoms, Hessl et al. 2002;
2 Literature review, Ouanes et al. 2019
Hardiman & Bratt 2016
3 Human study with MRI and cognitive assessment, Lupien et al. 1998
10 Mouse FMR1 mutation model of Fragile X & glutamate,
4 Morning cortisol & cognitive decline, Cernansky et al. 2006; Pietrzak et al. 2017
5 Longitudinal human study with multivariate modelling, Popp et al. 2015
6 11β-HSD1 inhibition reduced amyloid and cognitive decline, Sooy at al. 2015
7 Xanamem placebo-controlled trial working memory & attention
(Actinogen data on file)
cortisol mechanism Ghilian et al. 2015
11 Mouse cortisol (corticosterone), Lauterborn et al. 2004
12 FMR1 deficiency promotes age-dependent alterations in the cortical
synaptic proteome, Tang et al., 2015
13 Normalisation of anxiety with 11β-HSD1 inhibition,
Vanderklish & Francesconi 2019
5
Annual Financial Report Actinogen is poised to deliver
a series of clinical trial results
in 2022 and 2023 in three
different diseases
6
Actinogen Medical Limited Chairman’s Letter
Dear Shareholder,
It is with pleasure that I
present to you the Annual
Report for the financial year
ended 30 June 2021.
Actinogen has managed to excel through FY21, despite the
COVID-19 pandemic, which has challenged the resilience of
the healthcare industry as restrictions have affected the
progress of clinical development worldwide. Fortunately, with
limited impediment to our operating rhythm, we have
successfully executed our clinical pipeline objectives, and the
future of the company remains extremely bright. It is
incredibly pleasing to see Actinogen well-placed to emerge
from the pandemic environment into a strong commercial and
operational position in FY22 and beyond, driven by our
strategy and underpinned by the support of our shareholders.
Executive leadership
In March, we welcomed Dr. Steven Gourlay as Chief
Executive Officer and Managing Director after three months
acquainting himself with the company as our Consultant
Chief Medical Officer. Steve brings a wealth of experience in
the trial development of novel small-molecule therapies, with
a highly accomplished record of advancing those molecules
from the preclinical stage to Phase 3, then on to
commercialisation.
Since taking the role, Steve has been extremely proactive in
developing and setting the company’s strategy with the
Board and building the best team to help optimise our clinical
development pipeline. The Board is delighted by Steve’s
enthusiasm and immediate impact, and his appointment has
met with overwhelming shareholder and broader
market approval. We look forward to seeing Actinogen
continuing to grow and prosper under Steve’s leadership.
I would also like to express the Board’s sincere thanks to Dr
Bill Ketelbey for his valued contribution and executive
leadership as CEO and Managing Director during the past six
years to February 2021.
Balance sheet strength
Actinogen is in a strong financial position with $13.4 million in
cash as at 30 June 2021, sufficient to fund all planned phase
2 clinical trials. This amount does not include the R&D tax
incentive cash refund of approximately $1.4 million, which is
expected before the end of CY21.
The Company successfully completed a capital raising
program exceeding $10.9 million during the financial year to
advance the clinical development pipeline. The Board was
extremely pleased with the support received from existing
and new investors, which has helped strengthen our financial
position and allows us to implement our strategic priorities
Board and corporate governance
The Actinogen Board seeks continuous improvement in its
governance and management oversight capability. During the
past year we conducted our periodic review of all our
activities and responsibilities, including the Board skills matrix
to identify gaps and opportunities for improvement. In saying
that:
• We will continue to assess the skills suitable for the
Board and when appropriate, make changes and/or
additions.
• We intend establishing an inaugural audit committee to,
among several responsibilities, monitor and review the
integrity of the Company’s financial reporting. In line with
best practice corporate governance, the committee will
be comprised of independent non-executive directors.
The new committee charter will be available on our
website along with other corporate governance policies
including the main board charter.
Annual General Meeting
In consideration of our health and safety priorities, community
expectations and COVID-19 restrictions on public gatherings,
the Board has decided to conduct this year’s Annual General
Meeting as a virtual meeting. We will advise shareholders in
due course of the details of the meeting, including how to
participate, submit questions and how to vote.
The Actinogen team
Finally, I would like to thank our dedicated and diligent
leadership team, staff, consultant advisors, and business
partner organisations who all contribute to the excellence and
success of our operations. I also wish to thank my fellow
Board members for their ongoing commitment to Actinogen.
Outlook
Actinogen has just completed a very active, achievement-
filled 2021 financial year. The Board is confident about the
company’s prospects and capability to build on that success
under the leadership of our new CEO and his knowledgeable
and experienced team. We will continue to proactively
manage and drive excellence in our operations and execute
our strategic priorities to maximise value in the best interests
of our shareholders.
On behalf of the Board, I would like to thank you, our
shareholders, for your ongoing support and we look forward
to updating you on our progress during the year, including at
the virtual AGM in November.
Dr Geoff Brooke
Chairman
Monday, 30 August 2021
Annual Financial Report 7
Chief Executive
Officer’s Letter
Dear Shareholders,
First and foremost, I would like to thank you all for your continued
support in what has been an exciting first five months for me as
the CEO & Managing Director of Actinogen.
During this time, we have continued to execute our strategy
which consists of a “Fast-to-Market” approach with Fragile X
Syndrome, a “Big-to-Market” approach with Alzheimer’s
Disease, and by planning additional diversification with a third
disease program.
Actinogen represents a unique opportunity because the
scientific data for our lead molecule, Xanamem, is compelling.
Firstly, a large safety database for the Phase 2 stage has
been generated by trials in more than 220 patients or
volunteers. Secondly, pivotal positron emission tomography
data have shown high levels of target occupancy in the brain
of doses as low as 5mg daily, giving us confidence in a
broader and lower dose range for future studies. Thirdly, the
XanaHES randomised, placebo-controlled trial demonstrated
Xanamem’s activity to improve cognition within four weeks,
as measured by computerised neurological performance
tests. My thanks go out to former CEO, Bill Ketelbey, and the
rest of the team who helped to establish this strong
foundation for our future success.
Having initially consulted with the company on its clinical
development strategy last summer, I was able to review in
detail the building blocks, or foundation, for the strategy
outlined in the Corporate Strategy section immediately
following this letter. I was convinced of the promise for
Xanamem in multiple different indications to the extent that I
committed $330,000 to the shortfall placement in February,
and later accepted the appointment as CEO. Actinogen’s mid-
stage clinical development is an excellent match for my
experience of taking an early-stage company through each
phase of clinical and regulatory development. The company is
poised for great things, and our action plan reflects this.
At a high level, our three strategic areas
of action can be summarised as:
1. Operational excellence for “multiple
shots on goal”
2. Strengthening people and partnerships
3. Forward Planning to optimise timelines
to marketing approval(s)
Actinogen is focused on excellent clinical development,
designed to deliver “multiple shots on goal” with timely and
high-quality confirmation of clinical efficacy and safety in
each of its disease programs. The Company is conducting its
lead programs under a US Investigational New Drug (IND)
process to ensure that the highest standards of regulatory
compliance are used. Part A of the XanaMIA study will read
out in 1H CY22 and Part B approximately a year later in 2023.
The Fragile X trial will commence later this year and read out
in 2023. A carefully chosen third indication, will commence
in 2022.
Thanks to the exceptional work of the team, we have been
fortunate to continue our programs without significant delays
despite the COVID-19 pandemic and its associated
lockdowns. We continue to manage our clinical programs with
risk mitigation for future COVID-19 developments but
anticipate some impact on trial enrolment will be experienced.
We currently expect our trial data readouts in 2022 and 2023
to occur without major delays.
8 Actinogen Medical Limited
Actinogen represents a unique opportunity
because the scientific data for our lead
molecule, Xanamem, is compelling.
Pivotal positron emission
tomography study
confirms high levels
of target occupancy
at low doses
In recognition of the importance of people and partnerships
to our business, Actinogen continues to grow the
professional team, and enhance relationships with potential
future development partners.
During the year, Actinogen participated in the world’s largest
biotech partnering event, BIO Digital, where we met with
more than 20 large, mid and small cap companies interested
in our development programs. Further discussions are
planned at global meetings in 2022, with particular focus on
sharing the anticipated cognition data expected from the
XanaMIA Part A trial in 1H CY22.
In order to quickly add expertise to the team this year, we
have added skilled and experienced strategic and technical
consultants in multiple disciplines. Additional team members
will be added in the coming year.
Other activities to support Xanamem’s progress toward a
marketing approval are essential to our future success and
are timed to avoid delays. These activities include essential
nonclinical studies, manufacturing optimisation, future
European Medicines Agency consultation, and strengthening
of our intellectual property portfolio.
Actinogen and Xanamem are at an exciting stage of
development and poised to deliver valuable new clinical data
in 2022 and 2023. The impact of our programs could be life-
changing for many patients and their families, and we
sincerely thank all of those participants in our clinical trials for
their support and commitment.
Yours sincerely,
Dr Steven Gourlay
CEO & Managing Director
Monday, 30 August 2021
Annual Financial Report 9
Corporate Strategy
Operational excellence to
deliver high quality, timely
clinical data in 2022 and 2023
Strengthening strategic
and expert partnerships
Forward Planning to
optimise timelines to
marketing approval(s)
Clinical development excellence, designed to deliver
timely and high-quality confirmation of clinical efficacy
and safety in each of our disease programs:
• Alzheimers Disease (AD)
• Fragile X Syndrome (FXS)
• Third indication (to be announced)
Our lead programs are conducted under a
US Investigational New Drug (IND) process to ensure
highest standards of regulatory compliance for non-
clinical studies, manufacturing and clinical development.
We continue to develop relationships with potential
future development partners such as larger global
pharmaceutical companies, regional companies and
peer mid-cap companies.
Building on our semi-virtual business model, skilled
and experienced strategic and technical specialists will
be added to the team in accordance with need as the
Company grows.
Clinical Development: Active forward planning for
Part B of the XanaMIA trial following the Part A results
release anticipated in 1H CY22. Ancillary clinical
pharmacology studies planned. Long term clinical
program designs for AD, FXS and other potential
indications under regular review.
Regulatory nonclinical studies: Plan and conduct
essential Good Laboratory Practice (regulatory)
non-clinical studies.
Manufacturing: Explore manufacturing process
improvements and scale-up work. Additional Good
Manufacturing Practices (GMP) production batches
to be produced to support smooth transition into later
stage clinical development, ensuring that
to-be-marketed Xanamem drug substance and
drug product are used in pivotal, registration-
enabling studies.
10
Actinogen Medical Limited Our Vision
To realise a revolutionary therapy so that neurology
patients can lead their best lives
Our Fundamentals
Quality
Valued
In conjunction with the US FDA and
other regulatory authorities, we
strive for excellence in science and
clinical data within our programs. As
a result, we’ve conducted multiple
high-quality clinical trials to bring our
molecule, Xanamem, to this Phase 2
stage of development.
We are valued and respected
by patients, physicians, and
industry peers to bring Xanamem's
development forward. Science,
data and transparency guide us
to bring hope and potentially
change the world of cognitive
impairment forever.
Bold
Building on the solid scientific
rationale for Xanamem’s action, we
are rapidly developing programs in
multiple disease areas, including
adults with Alzheimer’s Disease,
children with Fragile X Syndrome,
and patients with other
neurological diseases.
Next-Gen
Xanamem is a cutting-edge
therapy and world-class
product that reduces cortisol
(the “stress hormone”) levels
in the brain. As a result, it is a
catalyst for new approaches in
managing neurodegenerative and
other illnesses.
11
Annual Financial Report Operating & Financial Review
1. PRINCIPAL ACTIVITIES
The principal activity of the Company during the year focused on the ongoing development of Xanamem, a unique inhibitor of
the 11β-HSD1 enzyme that achieves target engagement in the central nervous system. It is an oral medication for neurological
diseases amenable to its mechanism of lowering cortisol in brain cells. Brain cortisol is associated with a number of
neurological diseases, including AD, other neuropsychiatric diseases and Fragile X Syndrome (FXS).
2. OPERATIONS REVIEW1
Highlights
(i) Demonstrated high levels of target occupancy in the brain for Xanamem daily doses ranging from 5mg to 30mg
(ii) Commenced XanaMIA Phase 2 study for Alzheimer’s Disease
(iii) Achieved Fragile X Syndrome Rare Paediatric Disease Designation (RPDD)
(iv) Received positive XanaFX Phase 2 trial feedback from US FDA for Fragile X Syndrome
(v) Appointed Corden Pharma as scale-up manufacturer
(vi) Strengthened intellectual property (IP) portfolio – filed two patents for Xanamem to extend patent life protection
(vii) Appointed highly credentialled CEO Dr Steven Gourlay
(viii) Appointed key consultants in global regulatory affairs, clinical neurology, clinical pharmacology, pharmacology, toxicology,
biostatistics, manufacturing, and quality to drive fundamentally strategic projects
(ix) Secured new capital exceeding $10 million to fund planned clinical trials
The Year in Review
(i) Demonstrated high levels of Xanamem target engagement in the brain
Using positron emission tomography (PET) imaging, Actinogen demonstrated high levels of target occupancy in the brain for
daily Xanamem doses of 5mg, 10mg, 20mg and 30mg. These data showed a relatively flat dose response curve across all
doses, supporting the exploration of doses as low as 5mg daily in future studies. The study was conducted in 35 older
volunteers, some of whom were cognitively normal, and some with Alzheimer’s Disease.
(ii) XanaMIA Phase 2 study for Alzheimer’s Disease
The cognition (ability to think and remember) data collected through the successful Phase 1 XanaHES trial in healthy older
patients informs the two-part Phase 2 XanaMIA trial. During the financial year Actinogen received Bellberry Human Research
Ethics committee approval for the dose-ranging Part A of the trial, and signed work agreements with Avance Clinical and
Paratus Clinical to manage and assist in the study. Subsequent to financial year end, Actinogen announced a significant
landmark - the commencement of Part A of the XanaMIA trial, with the first Part A subject dosed.
XanaMIA Part A assesses the efficacy of 5mg and 10mg Xanamem doses compared to placebo in 105 older healthy subjects
(aged 50 to 80 years old), over 6 weeks, with a trial design that can rapidly confirm the minimum effective dose(s) to be
studied in Part B. Avance Clinical, and Paratus Clinical are managing subject recruitment activities across four geographically
dispersed sites in Australia.
XanaMIA Part B will investigate the efficacy of Xanamem in patients with early-stage Alzheimer’s Disease in a trial design
similar to Part A with detailed evaluation of Xanamem’s effect on blood and cerebrospinal fluid biomarkers. With this design,
Actinogen can rapidly confirm activity on cognition and underlying disease processes in AD. Both Part A and Part B of the
XanaMIA trial will utilise the sensitive Cogstate Neuropsychological Test Battery, supplemented by the Digit Symbol
Substitution Test (DSST) which has been recognised by the FDA as an appropriate endpoint for a cognitive marketing claim.
(iii) Fragile X Syndrome Rare Paediatric Disease Designation (RPDD)
Fragile X Syndrome (FXS) is an X-linked, inherited disorder, and the commonest genetic cause of intellectual disability. It is
most commonly expressed in boys and adult males, with a frequency of approximately 1 in 5,000 of the population. Females
are also affected but typically to a lesser extent due to having a second, normally functioning X chromosome. The disorder is
characterised by intellectual disability, learning difficulties, anxiety, and behavioural problems. There are no treatments for FXS
approved anywhere in the world. Existing options for treatment include sedatives and anxiolytic medication that have
significant side effect and limited benefits.
In February 2021, Xanamem was awarded RPDD by the FDA for treatment of FXS in children. The RPDD program is designed to
incentivise the development of drugs for rare childhood illnesses, such as FXS, with potential clinical, development and
commercial benefits. This includes priority review which fosters faster clinical development and hence commercialisation of
Xanamem.
1 Unless otherwise stated, all information in this Operations Review relates to the financial year ended 30 June 2021, and all financial data is quoted in Australian dollars.
12 Actinogen Medical Limited
2. OPERATIONS REVIEW (continued)
(iii) Fragile X Syndrome Rare Paediatric Disease Designation (RPDD)(continued)
In addition, if Xanamem is first registered for FXS, Actinogen will receive a Priority Review Voucher (PRV) from the FDA, which
can be used for different indications, and is also tradeable. Biopharma companies have historically sold PRVs for circa US$100
million - US$125 million in recent years, which highlights its substantial commercial potential.2
(iv) Positive XanaFX Phase 2 trial feedback from FDA
In June 2021, Actinogen received positive US FDA advice in response to a Pre-Investigational New Drug (pre-IND) submission
for its FXS program. The advice indicated that the data package and trial design proposed for the IND submission would be
sufficient, subject to final review of all supportive documentation submitted. FDA approval will ensure that the trial incorporates
all requirements and is of an international regulatory standard. The FDA and the Company are also in agreement on the
proposed Phase 2 patient population to be studied. This advice ensures Actinogen is well placed to file the full IND submission
in Q3 CY21.
Actinogen is well advanced with the planning for its Phase 2 XanaFX trial, which is expected to commence in 2H CY21. The trial
will commence at Australian specialist hospital clinics and study 50 patients, designed to provide robust Phase 2 data. It is a
randomised, placebo-controlled, double-blind, 12-week design investigating the safety and efficacy of Xanamem in male
adolescents and young adults possessing the full genetic features associated with FXS. Assessments will include cognition,
anxiety, sleep and behavioural problems.
(v) Corden Pharma appointed as scale-up manufacturer
Actinogen appointed Corden Pharma, a global contract manufacturer, to conduct the next stage of manufacturing for
Xanamem. Corden Pharma is a global pharmaceutical service and manufacturing platform of International Chemical Investors
Group (ICIG), and a full-service Contract Development & Manufacturing Organization (CDMO) for the production of Active
Pharmaceutical Ingredients (APIs), drug products, and associated packaging services.
(vi) IP portfolio strengthened
Actinogen continues to proactively strengthen its IP portfolio. During the year, Actinogen filed two new patent applications for
Xanamem to extend its patent life protection until 2040.
The first application seeks to provide patent protection to a method of treating cognitive decline. This patent is supported by
the statistically significant results of the Phase 1 XanaHES trial, which suggest that Xanamem meaningfully improves cognition
over placebo in cognitively healthy subjects.
The second application provides patent protection to a commercial scale-up manufacturing process for Xanamem, which
enables direct access to high purity Xanamem through a unique synthesis methodology. This innovation allows Actinogen to
leverage its production by effectively manufacturing Xanamem at larger scale quantities in preparation for future
commercialisation and clinical trials.
(vii) Senior Executive appointments
The Company appointed Dr Steven Gourlay as its new CEO on 15 March 2021 and he assumed the role of Managing Director
(MD) on his appointment to the board on 24 March 2021.
Dr Gourlay has more than 30 years of experience in the development of novel therapeutics and brings extensive knowledge of
the biotech industry to the senior management team. Formerly the founding Chief Medical Officer at US-based Principia
Biopharma Inc., he was responsible for the supervision of multiple clinical programmes, taking two small molecule therapies
forward from preclinical into Phases 2 and 3, as well helping to lead Principia’s successful NASDAQ IPO in 2018. Principia was
subsequently acquired by Sanofi Inc. for US$3.7 billion in September 2020. His global background in drug development,
regulatory affairs and commercial planning also includes six years at Genentech Inc, one of the world’s most successful biotech
companies. His development expertise, leadership skills and extensive industry networks will be invaluable at Actinogen’s
current stage of development.
Prior to his appointment, Dr Gourlay demonstrated his support of Actinogen’s clinical development and outlook by investing in
15 million ACW shares at the A$0.022 offer price, as part of the shortfall equity placement completed in February 2021. He is
currently the second largest shareholder of the Company, after BVF Partners.
Dr Gourlay has a medical degree from the University of Melbourne, a PhD in Medicine from Monash University and an MBA
from Macquarie University. He is a specialist physician in internal medicine and completed a postdoctoral fellowship in Clinical
Pharmacology at the University of California, San Francisco.
Mr Jeff Carter was appointed as the Company’s Chief Financial Officer (CFO) on 21 September 2020. Mr Carter is an
experienced ASX-listed company CFO and brings more than 20 years’ experience in executive roles at several biotech
companies.
2 Potential to receive a Priority Review Voucher (PRV) upon approval in FXS – Source: PRV value adapted from FDA website; Company press releases;
priorityreviewvoucher.org
Annual Financial Report 13
Operating and Financial Review (continued)
2. OPERATIONS REVIEW (continued)
(vii) Senior Executive appointments (continued)
Mr Carter holds a Bachelor of Financial Administration (University of New England) and a Master of Applied Finance (Macquarie
University) and is a qualified Chartered Accountant with experience in investment banking and mergers and acquisitions. Prior
to his move into the healthcare sector Mr Carter held senior positions with Coca Cola Amatil, Santos, Canadian Imperial Bank of
Commerce and Touche Ross.
Dr Bill Ketelbey resigned as CEO and MD of the Company on 8 February 2021. Dr Ketelbey was dedicated to developing
Xanamem over the last six years, and his services and expertise have contributed to accumulating the valuable pre-clinical and
clinical trial datasets now being used to guide and accelerate the mid-stage development of Xanamem.
(viii) Key consultant appointments
Building on Actinogen’s semi-virtual business model, and leveraging Board and CEO networks, experienced strategic and
technical consultants have joined the Company’s team in key fields such as investor communications, global regulatory affairs,
clinical neurology, clinical pharmacology, biostatistics, pharmacology, toxicology, manufacturing, and quality.
Recent examples include Regulatory Professionals International (RPI), a leading strategic and operational consulting group
based in the US with Australian and UK operations, which will act as Actinogen’s US Agent, strategic advisor and publisher for
regulatory submissions outside Australia.
Dr Dana Hilt MD, consultant CMO and neurologist, is advising the company on clinical strategy and trial design. Dr Hilt is CMO
of Frequency Therapeutics in the US and has held senior clinical roles in neurology drug development for more than 20 years.
Tom Malefyt, PhD has over 30 years’ experience in all aspects of small molecule therapeutics’ Chemistry, Manufacturing &
Controls (CMC) operations. Dr Malefyt is supervising the Company’s current manufacturing campaign at Corden Pharma and
implementing the company’s CMC planning.
The Company also continues to access world leaders in FXS clinical investigation to advise on its plans to evaluate Xanamem in
that condition.
(ix) Capital raising
In October and November 2020, Actinogen raised a total of $7.4 million under a Placement & Rights Issue to fund planned
clinical trials and for general working capital. This included $6.0 million raised via an oversubscribed placement supported by
new investors and existing shareholders, including its largest shareholder BVF Partners, and $1.4 million from eligible
shareholders under a non-renounceable 1 for 5 entitlement offer. In February 2021, Actinogen announced the successful
completion of a $3.6 million shortfall placement, in accordance with the terms of the entitlement offer.
3. FINANCIAL REVIEW
(a) Financial Performance
The financial performance of the Company during the year ended 30 June 2021 is as follows:
Revenue and other income ($)
Net loss after tax ($)
Loss per share (cents)
Dividend ($)
Revenue and other income comprise:
Full year ended
30/06/2021
2,011,162
(3,915,067)
(0.28)
-
Full year ended
30/06/2020
3,610,454
(5,330,529)
(0.48)
-
•
•
•
•
$27,090 in interest income from ordinary activities.
$1,438,571 R&D rebate receivable for the 30 June 2021 year end.
$144,656 in government grants received during the year.
$400,845 relates an R&D rebate portion previously recognised as Deferred Income in the prior year ended 30 June 2020.
Subsequently, upon receipt of the drug supplies this has now been recognised as income.
14 Actinogen Medical Limited
3. FINANCIAL REVIEW (continued)
(b) Financial Position
The financial position of the Company as at 30 June 2021 is as follows:
Cash and cash equivalents
Net assets / Total equity
Contributed equity
Accumulated losses
As at
30/06/2021
$
13,421,653
17,458,081
60,054,459
(48,441,913)
As at
30/06/2020
$
5,040,486
10,888,505
47,924,606
(44,526,846)
The increase in Cash and cash equivalents, and Contributed equity balances as at 30 June 2021 were largely attributed to
capital raisings during the year:
• On 22 October 2020, $6,000,000 was raised under a Placement
• On 17 November 2020, $1,360,229 was raised under a Rights Issue
• On 10 February 2021, $3,551,000 was raised under a Shortfall Placement
•
Total capital raising costs amounted to ($715,868)
4. COVID-19 RISK, FUTURE DEVELOPMENTS, AND EXPECTED RESULTS
In March 2020, the World Health Organisation declared the outbreak of COVID-19 as a pandemic. The Company has
commenced Part A of the XanaMIA trial and will commence future trials including Part B of the XanaMIA trial in patients with
Alzheimer’s Disease and a trial in patients with Fragile X. Avance Clinical and Paratus Clinical are managing ongoing subject
recruitment activities for the XanaMIA trial across four geographically dispersed sites in Australia, providing some level of risk
mitigation.
However, the course of the pandemic remains uncertain, which creates uncertainty around the level of disruption and impact
to the Company’s trial plans. At present the Company is unable to determine if COVID-19 disruptions will have a material impact
on future performance. All material developments in Actinogen’s activities will be disclosed as usual in accordance with the
Company’s continuous disclosure obligations under the ASX Listing Rules.
5. BUSINESS STRATEGY & OUTLOOK
Actinogen’s strategic priorities focus on three key elements:
(i) Operational excellence to deliver high quality, timely clinical data in 2022 and 2023
Actinogen continues to focus on excellent clinical development, designed to deliver timely and high-quality confirmation of
clinical efficacy and safety in each of its disease programs. The Company is conducting its lead programs under a US
Investigational New Drug (IND) process to ensure that the highest standards of regulatory compliance are used for non-clinical
studies, manufacturing and clinical development.
AD program
Actinogen commenced Part A of the Phase 2 XanaMIA trial with the first subject dosed in July 2021. By 1H CY22 the trial will
deliver data to reconfirm positive cognitive effects seen in the XanaHES trial and establish the minimally effective dose(s) of
Xanamem for future studies. Clinical sites were chosen in dispersed geographies to minimize the potential impact of the
COVID-19 pandemic.
Part B of the XanaMIA trial, in patients with early Alzheimer’s Disease, will commence in CY22 using the dose(s) determined in
Part A, with data readouts expected in CY23. Importantly, this trial will also evaluate the effects of Xanamem on biomarkers of
underlying disease processes, assessing potential of the therapy to be disease modifying.
FXS program
Actinogen will file a full IND submission in September, having received positive US FDA advice in response to a pre-IND
submission for its FXS program in June. The trial will commence at Australian specialist hospital clinics and study 50 patients,
designed to result in robust Phase 2 data for analysis in 2023. It is a randomised, placebo-controlled, double-blind, 12-week
design investigating the safety and efficacy of Xanamem in male adolescents and young adults with FXS.
Annual Financial Report 15
Operating and Financial Review (continued)
5. BUSINESS STRATEGY & OUTLOOK (continued)
(i) Operational excellence to deliver high quality, timely clinical data in 2022 and 2023 (continued)
Third program
Actinogen continues to be guided by the scientific rationale for reduction of brain cortisol and clinical benefit. A Phase 2, proof-
of-concept study is planned to commence in CY22. The disease to be studied will be chosen after review with a world-class
expert advisory group using a decision-matrix that includes scientific rationale, development feasibility and extent of unmet
medical need.
(ii) Strengthening strategic and expert partnerships
Actinogen continues to develop its relationships with potential future development partners such as larger global
pharmaceutical companies, regional companies and peer mid-cap companies. During the year, Actinogen participated in the
world’s largest biotech partnering event, BIO Digital, which attracted over 4,000 biotechnology and pharmaceutical companies
from nearly 80 countries.
Actinogen’s CEO, Dr Steven Gourlay, participated in more than 20 prospective partner meetings with organisations that have a
strong interest in Actinogen’s development in AD, FXS and other potential indications. Further discussions are planned at global
meetings in 2022, with particular focus on the confirmatory cognition data expected from the XanaMIA Part A trial in 1H CY22.
Actinogen has an established advisory board of high calibre academic advisers from across the globe, specialising in AD and
the endocrinology of cortisol. In the past year, expert advisors in FXS have been added to ensure the Phase 2 trial is designed
to the highest standard possible.
Building on Actinogen’s semi-virtual business model, skilled and experienced strategic and technical consultants in investor
communications, global regulatory affairs, clinical neurology, clinical pharmacology, biostatistics, pharmacology, toxicology,
manufacturing, and quality have been appointed to the Company’s team during 2021. Additional team members will be added
in accordance with need as the Company grows.
(iii) Forward Planning to optimise timelines to marketing approval(s)
Clinical Development: Actinogen is actively planning Part B of the XanaMIA trial to enable commencement as soon as
practicable following the Part A results release anticipated in 1H CY22. Ancillary clinical pharmacology studies, to be performed
in parallel with later development, are also in planning. Long term clinical program designs for AD, FXS and other potential
indications are under regular review.
Regulatory nonclinical studies: In parallel with its clinical activities, Actinogen plans and conducts essential Good Laboratory
Practice (regulatory) non-clinical studies.
Manufacturing: Actinogen currently has sufficient Xanamem product for planned Phase 2 clinical trials. Our contract
manufacturing partners continue to explore manufacturing process improvements and scale-up work, and additional Good
Manufacturing Practices (GMP) production batches will be produced in coming years. This work will support a smooth
transition into later stage clinical development, ensuring that to-be-marketed Xanamem drug substance and drug product are
used in pivotal, registration-enabling studies.
People: Additional key personnel are being appointed as consultants or employees (see above) according to need.
Intellectual Property: Actinogen is preparing additional patent filings to further strengthen the Xanamem patent portfolio.
Current patents provide “composition of matter” protection to 2031, with 5-year extensions available in most major markets to
2036. During the year, Actinogen filed two new patent applications for Xanamem to extend its patent life protection until 2040.
Additional patents may be sought for use of Xanamem in novel disease indications, manufacturing processes and formulation.
Where possible, additional patent protection will be sought from use of a paediatric development plan, orphan status
designation and other regulatory mechanisms.
16 Actinogen Medical Limited
Board of Directors and Company
Secretary
BOARD OF DIRECTORS
Dr Geoffrey Brooke
MBBS, MBA
Non-Executive Chairman (appointed 1 March 2017)
Executive Chairman (appointed 8 February 2021, ceased 24 March 2021)
Dr Brooke is a healthcare industry and venture capital veteran with over 30 years’ international experience as the founder, lead
investor and/or Chairman/Director of numerous healthcare companies with a realised value of more than $1.5 billion. Most
notably, he was the Managing Director and Founder of leading life sciences venture capital firm, GBS Ventures - one of Asia
Pacific’s premier investors in the healthcare space. There, Dr Brooke was responsible for GBS’s healthcare venture activity in
the region and raised $450 million in venture and private equity funds, focused on biopharmaceuticals, medical devices and
services.
Dr Brooke was also responsible for numerous investments and exits via NASDAQ and ASX public listings and trade sales, as
well as being lead investor in numerous investments syndicated in multiple rounds with premier US venture firms. Dr Brooke
was also President and Founder of US-based seed healthcare venture capital firm, Medvest Inc., with investors including the
venture capital arm of leading global multinational medical devices, pharmaceutical and consumer packaged goods
manufacturer, Johnson & Johnson. Medvest was focused on founding companies based upon healthcare-related technology,
including pharmaceuticals, biotechnology, therapeutic devices, medical services and information systems.
Dr Brooke now acts as a private investor in, and independent director for, a number of small to medium-sized Australian and
US private and public companies. He holds a Bachelor of Medicine and a Bachelor of Surgery from Melbourne University
(Australia) and a Masters of Business Administration from IMEDE (Switzerland), now IMD.
During the past three years Dr Brooke has served as a Director of the following ASX-listed companies:
• Non-Executive Director of Acrux Limited (ASX:ACR) – Current
• Non-Executive Chairman of Cynata Therapeutics Limited (ASX:CYP) – Current
Dr Steven Gourlay
MBBS FRACP PhD MBA
Managing Director (appointed 24 March 2021)
Chief Executive Officer & Chief Medical Officer (appointed 15 March 2021)
Dr Gourlay has more than 30 years of experience in the development of novel therapeutics and brings considerable skills and
experience to Actinogen as the Company moves into further clinical development of its lead compound Xanamem. Formerly the
founding Chief Medical Officer (CMO) at US-based Principia Biopharma Inc., Dr Gourlay was responsible for the supervision of
multiple pre-clinical, first-in-human, Phase 2 and 3 clinical trial programs in orphan immunological diseases, multiple sclerosis
and cancer. The data generated by these trials, and Dr Gourlay’s roadshow presentations, supported a successful NASDAQ IPO
of Principia Biopharma Inc. in 2018 - subsequently followed by an acquisition by Sanofi for US$3.7 billion in 2020.
Prior to Principia Biopharma, Dr Gourlay was a Partner at GBS Venture Partners, the Australian specialist life sciences and
healthcare venture capital firm, where he contributed to the success of multiple clinical stage therapeutic companies including
Elastagen, Spinifex and Peplin. Before GBS, and after a post doctorate in clinical pharmacology at the University of California,
San Francisco, he held positions of increasing responsibility at Genentech, Inc. in the areas of pharmacoepidemiology and early
clinical development.
Dr Gourlay has significant drug regulatory experience with the US Food and Drug Administration (FDA), European Medicines
Agency (EMA) at many levels, including filing more than 10 Investigational New Drug (IND) applications, achieving several
orphan drug status approvals for his Company's product(s), and completing several biologics license applications.
Dr Gourlay is based in Sydney and holds a Bachelor of Medicine, Bachelor of Surgery (MB,BS) from the University of
Melbourne, a PhD in Medicine from Monash University, an MBA from Macquarie University and is a fellow of the Royal
Australian College of Physicians (FRACP). He is also a specialist physician in general internal medicine.
Dr Gourlay has held no other ASX-listed directorships during the past three years.
Annual Financial Report 17
Board of Directors and Company Secretary (continued)
Dr George Morstyn
MBBS FRACP PhD FTSE
Non-Executive Director (appointed 1 December 2017)
Dr Morstyn has more than 25 years’ experience in the biotechnology industry including as Senior Vice President of
Development and Chief Medical Officer at Amgen Inc. Dr Morstyn had overall responsibility globally for drug development in all
therapeutic areas including neuroscience at Amgen Inc. and was a member of the Operating Committee. Many new products
were approved and launched during Dr Morstyn’s tenure. Prior to joining Amgen Inc. Dr Morstyn was the principal investigator
on the earliest clinical studies of the haemopoietic colony stimulating factors (CSF). The CSFs were subsequently approved
and launched and were a major medical breakthrough that have been used to reduce side effects of chemotherapy and enable
transplantation in more than 20 million patients worldwide. The CSFs have become multi-billion dollar drugs. Since returning to
Australia, Dr Morstyn has been a Non-Executive Director of various for-profit and not-for-profit companies, including many
biotechnology companies.
Dr Morstyn is a medical graduate of Monash University (Australia), and obtained a PhD at the Walter and Eliza Hall Institute of
Medical Research (Australia) and a FRACP in Medical Oncology following a Fellowship at the National Cancer Institute in the
USA. He is currently an advisor to Symbio (Tokyo) Limos Biotech and TroBio. He is a Member of the Australian Institute of
Company Directors and a Fellow of the Australian Academy of Technological Sciences and Engineering.
Dr Morstyn has held no other ASX-listed directorships during the past three years.
Mr Malcolm McComas
BEc, LLB (Monash), SFFin, FAIDC
Non-Executive Director (appointed 4 April 2019)
Mr McComas is a company director with experience in healthcare including drug development, clinical trials, the regulatory
environment and medical devices. He was previously an investment banker with career experience in financial services
covering mergers and acquisitions, debt and equity funding across multiple industry sectors including healthcare, FMCG,
resources, financial services and privatisations. He has held leadership roles with Grant Samuel as Director, County NatWest
(now Citigroup) as Managing Director and Head of Corporate Finance and Morgan Grenfell (now Deutsche Bank) working in
Australia and the UK.
Previously, Mr McComas was a lawyer at Herbert Geer specialising in tax and company law. He has for-purpose experience as
a director of Australasian Leukaemia and Lymphoma Group (ALLG), the blood cancer clinical trials group and peak body
experience as past President of the Financial Services Institute of Australia. He is a Fellow of the Australian Institute of
Company Directors and holds degrees in Law and Economics from Monash University (Australia).
During the past three years Mr McComas has served as a Director of the following ASX-listed companies:
• Chairman, Pharmaxis Limited (ASX:PXS) – Current
• Chairman, Fitzroy River Corporation Limited (ASX:FZR) – Current
• Non-Executive director, Core Lithium Limited (ASX:CXO) – Current
• Non-Executive Director, Royalco Resources Limited (ASX:RCO) – Delisted February 2020
• Non-Executive Director, Saunders International (ASX:SND) - Resigned May 2019
Dr Bill Ketelbey
MBBCh, FFPM, MBA, GAICD
Managing Director and Chief Executive Officer (appointed 18 December 2014, resigned 8 February 2021)
Dr Ketelbey is a highly experienced and successful healthcare and pharmaceutical sector professional, with more than 30
years’ experience in the industry, including senior medical and management roles with global pharmaceutical giant, Pfizer. Dr
Ketelbey has a medical degree from the University of the Witwatersrand (South Africa), is a Fellow of the Faculty of
Pharmaceutical Medicine with the Royal College of Physicians (UK), has an MBA from Macquarie University (Australia), and is a
Graduate of the Australian Institute of Company Directors. During Dr Bill Ketelbey’s 6 year tenure with the Company, he made a
significant contribution to Actinogen. Dr Ketelbey held no other ASX-listed directorships during the past three years.
COMPANY SECRETARY
Peter Webse (appointed 10 October 2013)
B.Bus, FGIA, FCPA, MAICD
Mr Webse joined Actinogen in 2013 and has over 27 years of company secretarial experience. He is the managing director of
Platinum Corporate Secretariat Pty Ltd, a company specialising in providing company secretarial, corporate governance, and
corporate advisory services. Mr Webse attended Edith Cowan University of Western Australia to obtain his degree in
Accounting and Finance. He is a highly experienced CPA and is a Fellow of the CPA Australia (FCPA). He is also a Fellow of the
Governance Institute of Australia (FGIA), a Fellow of the Chartered Governance Institute (GCI), and a Member of the Australian
Institute of Company Directors (MAICD). Mr Webse is also a non-executive director of Cynata Therapeutics Limited.
18 Actinogen Medical Limited
Executive Leadership Team
Dr Steven Gourlay
MBBS FRACP PhD MBA
Chief Executive Officer & Chief Medical Officer (appointed 15 March 2021)
See biography on page 17.
Mr Jeff Carter
Chief Financial Officer
Mr Carter joined Actinogen in September 2020 and has more than 30 years of expertise in professional accounting, investment
banking, corporate finance and commercial / strategic planning roles. He has international experience as Vice President –
Corporate Development and served as a member of the board of a USA based company.
Since the beginning of 2000 Mr Carter has served as chief financial officer and company secretary of several publicly listed
healthcare and biotech companies. Prior to his move into the healthcare sector he also held senior positions with Coca Cola
Amatil, Santos, Canadian Imperial Bank of Commerce and Touche Ross.
Mr Carter holds a Bachelor of Financial Administration (UNE) and a Master of Applied Finance (Macquarie University) and is a
qualified Chartered Accountant.
Mr Carter is also the Chief Financial Officer of Amplia Therapeutics Limited (ASX:ATX) since its IPO in 2013.
Ms Tamara Miller
Vice President Drug Development and Strategy
Ms Miller joined Actinogen in September 2017 and has over 20 years of international clinical operations and product
development experience. She holds a Masters and a Bachelor’s Degree in Biomedical Sciences, as well as a Diploma of
Business and Project Management Professional (PMP) certification.
Ms Miller has lived and worked in Australia, the UK, and the US while holding senior positions in product development, clinical
operations, and project management. Her background includes positions within pharmaceutical and biotechnology companies
as well as for CROs, working across a multitude of therapeutic areas, managing all aspects of the drug development life cycle,
and leading cross-functional teams.
As part of the Actinogen team, Ms Miller oversees and manages the overall drug development process and strategy including
pre-clinical, clinical development, clinical operations, CMC & manufacturing, regulatory operations, and R&D budget/finance
operations.
Ms Therese Russell
Head of People & Infrastructure
Ms Russell joined Actinogen in October 2016 and has over 20 years of experience in the financial services, investment banking
and corporate advisory sectors. She has worked in project management, corporate advisory, branding, and corporate office
administration roles with a range of medium to large private companies.
As part of the Actinogen team, Ms Russell is responsible for employee relations, IT infrastructure, social media and internal
communications as well as the management and administration of the corporate head office.
Dr Christian Toouli
Head of Business Development
Dr Toouli joined Actinogen in 2017 to manage the company’s business development program and has more than fifteen years
of experience in business development and strategy, particularly in the biotechnology sector. He also serves as the CEO and
Managing Director of FivepHusion, a private oncology-focused biotech company, and is Executive Director of Bio-Link
Australia, a global business development and strategic advisory company
Dr Toouli has co-founded two biotechnology companies developing cutting-edge therapeutic platform technologies.
Previously, Dr Toouli was a Postdoctoral Fellow in the Discovery Research Department of Schering-Plough Biopharma/DNAX
Research Institute, the biotechnology arm of the Schering-Plough Corporation.
Dr Toouli holds a PhD from the University of Sydney and was awarded a Certificate in Biotechnology Management with
Honours from the University of California, Santa Cruz Extension, and First-Class Honours in Biotechnology from Flinders
University of South Australia. He is also a graduate of the Australian Institute of Company Directors.
Annual Financial Report 19
Directors’ Report
Your Directors present their report pertaining to Actinogen Medical Limited
(‘Actinogen Medical’ or ‘the Company’) for the year ended 30 June 2021.
1. BOARD OF DIRECTORS
The names and details of the Company’s Directors in office during the financial year and until the date of this Report are
as follows. Directors were in office for the entire period, unless otherwise stated.
Name
Position
Appointed
Resigned
Dr Geoffrey Brooke
Non-Executive Chairman
Executive Chairman (interim period)
1/03/2017
8/02/2021
Current
24/03/2021
Dr Steven Gourlay
Managing Director / Chief Executive Officer
24/03/2021
Dr George Morstyn
Non-Executive Director
Mr Malcolm McComas
Non-Executive Director
1/12/2017
4/04/2019
Current
Current
Current
Dr Bill Ketelbey
Managing Director / Chief Executive Officer
18/12/2014
8/02/2021
Details of Directors qualifications and experience are set out on pages 17 to 18 of this annual report.
Interests in the shares and options of the Company and related bodies corporate
As at the date of this Report, the interests of the Directors in the shares and options of the Company were as follows:
Director
Dr Geoffrey Brooke
Dr Steven Gourlay
Dr George Morstyn
Mr Malcolm McComas
Fully paid
ordinary shares
Loan shares
("LTI Rights") (a)
1,590,000
15,000,000
2,790,000
600,000
-
48,362,300
-
-
Unlisted
options
9,900,000
-
3,000,000
3,000,000
Total
19,980,000
48,362,300
15,900,000
(a) The 48,362,300 shares on issue to Dr Gourlay, which he received as remuneration upon commencement of employment
on 15 March 2021, are issued ordinary shares that carry voting and divided rights. However, they also carry trading
restrictions and have therefore been accounted for as “in-substance options”. Refer to Section 3(C)(b)(iii) within the
Remuneration Report for information on these loan shares.
2. DIRECTORS’ MEETINGS
The following table sets out the number of meetings of the Company’s Directors held while each Director was in office and the
number of meetings attended by each Director.
Director
Dr Geoffrey Brooke
Dr Steven Gourlay (a)
Dr George Morstyn
Mr Malcolm McComas
Dr Bill Ketelbey (a)
Number of meetings
available to attend
Number of meetings
attended
7
2
7
7
4
7
2
7
7
4
(a) Dr Gourlay commenced employment with the Company on 15 March 2021; Dr Ketelbey ceased employment with the
Company on 8 February 2021.
Due to size and scale of the Company, there are no Remuneration, Risk, Nomination or Audit Committees at present. Matters
typically dealt with by these Committees are, for the time being, referred to the Board of Directors. The Board intends on
establishing an audit committee in FY22. In line with best practice corporate governance, the committee will be comprised of
independent non-executive directors. The new committee charter will be available on our website along with other corporate
governance policies including the main board charter. For details of the function of the Board please refer to the Corporate
Governance Statement which is included as part of this Annual Report.
20 Actinogen Medical Limited
3. COMPANY SECRETARY
Details of the Company Secretary's qualifications and experience are set out on page 18 of this annual report.
4. CORPORATE GOVERNANCE
The Board recognises the recommendations of the ASX Corporate Governance Council and has disclosed its level of
compliance with those guidelines within the Corporate Governance Statement which is included as part of this Annual Report.
5. SHARES UNDER OPTION
As at the date of this Report, there were 37,058,333 unissued ordinary shares under option:
Quantity
5,783,333
1,600,000
5,000,000
1,500,000
Type of Option
Employee Options
Employee Options
Director Options
Director Options
15,175,000
Director Options
3,000,000
5,000,000
Director Options
Employee Options
37,058,333 Total Options
Grant Date
12/12/2018
28/09/2020
24/03/2017
1/12/2017
28/11/2018
4/04/2019
1/02/2019
Exercise Price
Expiry Date
$0.085
$0.046
$0.100
$0.100
$0.085
$0.100
$0.093
12/12/2023
27/09/2025
24/03/2025
1/12/2022
27/11/2023
4/04/2024
1/02/2024
During the year, and up to the date of this Report, the following options expired, lapsed or were forfeited:
•
•
5 February 2021 – 3,559,298 options issued to employees of the Company at $0.10 per option expired on 5 February 2021.
8 May 2021 - 2,925,000 options issued to Dr Bill Ketelbey at $0.085 per option, expiring on 27 November 2023, lapsed as
vesting conditions weren’t met due to forfeiture associated with cessation of employment on 8 February 2021.
There are 48,362,300 Loan Shares currently on issue that are accounted for as “in-substance options” due to the vesting
conditions attached to them, however, they are in fact issued ordinary shares and therefore, not included in the table above.
For further information refer to Section 3C(b)(iii) of the Remuneration Report.
6. DIVIDENDS
No amounts have been paid or declared by way of dividend since the date of incorporation. The Directors recommend that no
final dividend be paid.
7. EVENTS SUBSEQUENT TO THE END OF FINANCIAL YEAR
On 15 July 2021, Actinogen announced that the first subject had been treated in Part A of its two-part XanaMIA trial, targeting
patients with Alzheimer’s Disease (AD). The commencement of this trial is a significant milestone in the progression of
Actinogen’s program to treat patients with early stages of AD and is crucial to determining the minimally effective dose(s) to be
utilised in future Actinogen trials.
8. SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
Other than as disclosed in the financial statements, there were no significant changes in the state of affairs of the Company
during the financial year.
9. OPERATING AND FINANCIAL REVIEW
Please refer to pages 12 to 16 of this annual report for information on the Company's principal activities, operations,
financial position and business strategy and outlook. Please also refer to pages 10 and 11 for a summary of the corporate
strategy, vision and fundamentals.
10. BUSINESS STRATEGY & OUTLOOK
Please refer to pages 15 and 16 of this annual report for information on the Company's business strategy and outlook. Please
also refer to pages 10 and 11 for a summary of the corporate strategy, vision and fundamentals.
Annual Financial Report 21
Directors’ Report (continued)
Remuneration Report (Audited)
11. REMUNERATION REPORT
The information contained in the Remuneration Report has been audited, as required by Section 308(3C) of the Corporations
Act 2001. The Remuneration Report is set out under the following main headings:
1.
Introduction
2. Remuneration governance
3. Remuneration arrangements
A. Remuneration principles and structures
B. Elements of remuneration
C. Details of STI and LTI incentive plans that existed during FY21
4. Key Management Personnel remuneration outcomes and performance during FY21
5. Executive employment agreements
6. Non-Executive Director fee arrangements
7. Disclosures relating to options
8. Disclosures relating to shares
9. Loans to Key Management Personnel and their related parties
10. Other transactions & balances with Key Management Personnel and their related parties
11. Consequences of performance on shareholder’s wealth
1.
INTRODUCTION
The Remuneration Report details the remuneration arrangements for Key Management Personnel (KMP) who are defined as
those having authority and responsibility for planning, directing and controlling the major activities of the Company, directly or
indirectly, including any Director (whether executive or otherwise). The performance of the Company depends upon the
quality of its KMP. To prosper, the Company must attract, motivate and retain appropriately skilled Directors and executives.
The Company’s broad remuneration policy is to ensure the remuneration package properly reflects the person’s duties and
responsibilities and that remuneration is competitive in attracting, retaining and motivating people of the highest quality. The
people considered to be KMP during the financial year were:
Name
Position
Current / Resigned
Dr Geoffrey Brooke
Non-Executive Chairman
Current
Dr Steven Gourlay
Managing Director / Chief Executive Officer
Current
Dr George Morstyn
Non-Executive Director
Mr Malcolm McComas
Non-Executive Director
Current
Current
Ms Tamara Miller
Vice President of Drug Development & Strategy Current
Mr Jeff Carter
Chief Financial Officer
Current
Dr Bill Ketelbey
Managing Director / Chief Executive Officer
8/02/2021
There were no other changes to KMP after the reporting date and before the date that the financial report was authorised for
issue.
2. REMUNERATION GOVERNANCE
The Board has not established a separate Remuneration Committee at this point in the Company’s development nor has the
Board engaged the services of a remuneration consultant to provide recommendations when setting the remuneration received
by Directors. Therefore, remuneration of Directors is currently set by the Board of Directors, which is put to shareholders at the
Annual General Meeting (AGM). At the AGM held on 27 November 2020, Actinogen Medical received 96.76% of votes in favour
of its Remuneration Report for the 2020 financial year. The Company did not receive any specific feedback at the AGM or
throughout the year on its remuneration practices.
22 Actinogen Medical Limited
It is considered that the size of the Board, along with the level of activity of the Company, renders having a Remuneration
Committee impractical, and the full Board considers in detail all of the matters for which the Directors are responsible. All
matters of remuneration are performed in accordance with the Corporations Act 2001 requirements, especially in respect of
related party transactions. Refer to the Corporate Governance Statement for further information.
3. REMUNERATION ARRANGEMENTS
(A) Remuneration principles and structures
The Company aims to reward executives with a level and mix of remuneration commensurate with their position and
responsibilities within the Company and aligned with market practice. The nature and amount of remuneration of executives is
assessed on a periodic basis by the Board (in the absence of a Remuneration Committee) for their approval, with the overall
objective of ensuring maximum stakeholder benefit from the retention of high performing executives.
The main objectives sought when reviewing executive remuneration is that the Company has:
•
•
•
•
coherent remuneration policies and practices to attract and retain executives,
executives who will create value for shareholders,
competitive remuneration offered benchmarked against the external market, and
fair and responsible rewards to executives having regard to the performance of the Company, the performance of the
executives and the general pay environment.
(B) Elements of remuneration
The Company aims to reward executives with a level and mix of remuneration appropriate to their position and responsibilities,
while being market competitive. The Company’s remuneration structure for executives can include a mix of fixed remuneration,
short term incentives and long-term incentives as outlined below.
Fixed remuneration component
Fixed remuneration is represented by total employment cost and comprises base salary, statutory superannuation
contributions (where applicable) and other benefits. It is paid by the Company to compensate fully for all requirements of the
executive’s employment with reference to the market and the individual’s role and experience. It is subject to annual review
considering market data and the performance of the Company against appropriate market comparisons with the comparator
group criteria being market capitalisation.
Short-term incentive (STI) component
The STI component is in the form of a cash bonus to executives of the Company (bonuses are also applicable to selected
employees).
Long-term incentive (LTI) component
The Board is of the opinion that the shares and options currently on issue provide a sufficient LTI to align the goals of the KMP
with those of the shareholders to maximise shareholder wealth.
Annual Financial Report 23
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
3. REMUNERATION ARRANGEMENTS (CONTINUED)
Details of how the STI and LTI is structured is outlined in the table below.
Short-Term Incentive (STI)
Long-Term Incentive (LTI)
How is it paid?
Up to 100% of any STI award is paid as a cash
bonus after the assessment of annual
performance and achievement of business goals.
The LTI component is in the form of employee and
Director options and/or loan shares upon payment
of a pre-determined exercise price.
How much can
executives earn?
Executives and selected employees have a
maximum STI opportunity of 20% of fixed
remuneration; while Managing Director, Dr Steve
Gourlay, has a maximum STI opportunity of 35%
of fixed remuneration.
The LTI opportunity is at the discretion of the
Board. The value of options and/or loan shares
granted is determined using the fair value at the
date of grant using a Black Scholes option pricing
model, taking into account the terms and
conditions upon which the options and/or loan
shares were granted.
The STI performance objectives are set prior to
the beginning of each year, covering financial
and non-financial measures and can include, but
is not limited to, the following: clinical
development, project analysis, patient
enrolments, planning, regulatory, budgeting, drug
development, business development activities
and share-price performance.
LTI's vest according to vesting conditions set at
the date of grant. The performance measures are
tested at the end of each reporting period where it
is determined how many options and/or loan
shares have vested according to the vesting
conditions set. Options and/or loan shares may
lapse if the performance measures are not met at
the end of the performance period.
How is
performance
measured?
When is it paid?
What happens if an
executive leaves?
The STI award is determined after the end of the
financial year following a review of performance
over the year against the STI performance
measures by the Board (and in the case of the
CEO, by the Non-Executive Directors). The Board
approves the final STI award based on this
assessment of performance.
If an executive ceases employment during the
performance period by reason of redundancy, ill
health, death, or other circumstances approved
by the Board, then subject to Board discretion,
the executive may be entitled to a pro-rata cash
payment based on assessment of performance
up to the date of ceasing employment for
that year.
Non-cash payment is in the form of vested options
and/or loan shares subject to vesting conditions
being achieved and the terms and conditions upon
which the options and/or loan shares were
granted.
If an executive resigns or is terminated for cause,
any unvested LTI awards are forfeited, unless
otherwise determined by the Board. If an executive
ceases employment during the performance period
by reason of redundancy, ill health, death, or other
circumstances approved by the Board, the
executive will generally be entitled to a pro-rata
number of unvested options and/or loan shares
based on achievement of the performance
measures over the period up to the date of ceasing
employment (subject to Board discretion). The
treatment of vested and unexercised awards will
be determined by the Board with reference to the
circumstances of cessation.
In the event of a change of control, a pro-rata
assessment may be made up to the date of the
change of control. Further, under the terms and
conditions of the options and/or loan shares any
unvested awards may vest on a change of control,
at the Board’s discretion.
What happens if
there is a change
of control?
In the event of a change of control, a pro-rata
cash payment may be made based on
assessment of performance up to the date of the
change of control, at the Board’s discretion.
24 Actinogen Medical Limited
(C) Details of STI and LTI plans that existed during FY21
During the financial year ended 30 June 2021, the Board of Directors had in place various Short-term Incentives and Long-term
Incentives which are outlined below.
(a) Short-term Incentives
The Board of Directors put in place various STIs that when achieved, a cash bonus is paid. The following KMPs received a
bonus during the year:
Ms Tamara Miller – Vice President of Drug Development & Strategy
As part of Ms Millers employment agreement, various short-term performance conditions relating to clinical development, pre-
clinical development, product development, project analysis, patient enrolments, studies, planning, regulatory, budgeting, data
read-out, executed confidentiality agreements with potential partners, drug development and regulatory plan were met during
the 2020 calendar year and the 2021 calendar year.
The Board agreed that Ms Miller achieved a number of these performance conditions and was paid a $25,000 bonus in
September 2020 that related to the 2020 financial year. In addition, a bonus of $48,500 was accrued for the 2021 financial
year and this was paid in July 2021.
Dr Bill Ketelbey – Former Managing Director and Chief Executive Officer – Resigned 8 February 2021
As part of Dr Ketelbey’s termination payout, and at the discretion of the Board, a STI cash bonus was paid for the achievement
of various short-term performance conditions relating to clinical development, capital raisings, and business development
being met during both the 2020 and 2021 calendar years and up until his resignation on 8 February 2021. The Board agreed
that Dr Ketelbey achieved a number of these performance conditions and was paid a $35,000 STI bonus fee in February 2021.
(b) Long-term Incentives
The LTIs currently in place are in the form of Employee Options, Director Options and Loan Shares, and are summarised below:
Reference
(i)
(i)
(ii)
(ii)
(ii)
(ii)
(iii)
(iii)
Quantity Type of LTI
5,783,333 Employee Options
1,600,000 Employee Options
5,000,000 Director Options
1,500,000 Director Options
15,175,000 Director Options
3,000,000 Director Options
5,000,000 Employee Options
37,058,333 Total Options
24,181,150 Loan Shares
24,181,150 Loan Shares
48,362,300 Total Loan Shares
Annual Financial Report 25
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
3. REMUNERATION ARRANGEMENTS (CONTINUED)
(i) Employee Options
Directors are not eligible to receive Employee Options under the Employee Option Plan currently in place with the Company.
This Plan allows for employees, contractors and consultants to participate on a selected basis and at the discretion of the
Board. The general terms of each option issue are as follows:
•
•
•
Entitlement: Each Option gives the holder (Option holder) the right to subscribe for one fully paid ordinary share in the
Company (Share) upon exercise of the Option.
Issue Price of Options: Options are issued for no consideration.
Valuation Methodology: Due to the vesting conditions attached to all Options issued, they have been valued using a Black-
Scholes option pricing model, whereby the total share-based payment is expensed over the vesting period. Refer to Note
21: Share-based Payments for further information.
• Other terms: The rights, restrictions and obligations which apply to Options, including in relation to vesting, disposal and
forfeiture, are pursuant to the terms of the offer letters accepted and signed by the Employee at the time of the offer.
During the year, the following KMP held the following options issued under the Employee Option Plan.
Ms Tamara Miller – Vice President of Drug Development & Strategy
Of the 5,783,333 employee options currently on issue, 4,000,000 relate to Ms Miller, with specific details outlined below:
Grant Date
Quantity
Exercise Price
Expiry Date
Vesting Conditions:
Employee Options
12/12/2018
4,000,000
$0.085
12/12/2023
4,000,000 options vest quarterly over a period of 3 years from Grant Date, subject to continuous employment with the
Company during the period from the date of grant up to and including the applicable vesting dates. As at 30 June 2021,
3,333,333 options have vested and 666,667 options remain unvested. While there are no performance conditions attached to
these options, the award is a reward for prior service and to provide adequate incentive for continued service to the Company.
Previously, Ms Miller held 974,610 employee options which fully vested in a prior financial year, however, they expired during
the current financial year, on 5 February 2021.
Mr Jeff Carter – Chief Financial Officer
Grant Date
Quantity
Exercise Price
Expiry Date
Vesting Conditions:
Employee Options
28/09/2020
1,600,000
$0.046
27/09/2025
Of 1,600,000 options issued, 533,333 (one-third) will vest 12 months from date of grant, with the balance of 1,066,667 (two-
thirds) to vest quarterly thereafter. Vesting is subject to continuous service to the Company during the period from the date of
grant up to and including the applicable vesting dates. As at 30 June 2021, 1,600,000 options remain unvested. While there are
no performance conditions attached to these options, the award is a reward for fulfilling the role of Chief Financial Officer and
to provide adequate incentive for continued service to the Company.
26 Actinogen Medical Limited
(ii) Director Options
There were no Director Options issued to current Directors during the current financial year ended 30 June 2021. In prior years,
Directors Options were issued to current Directors of the Company, the specific details are outlined in the section below.
However, in all instances the general terms of each option issue are as follows:
•
•
•
Entitlement: Each Option gives the holder (Option holder) the right to subscribe for one fully paid ordinary share in the
Company (Share) upon exercise of the Option.
Issue Price of Options: Options are issued for no consideration.
Valuation Methodology: Due to the vesting conditions attached to all Director Options issued, they have been
independently valued using a Black-Scholes option pricing model, whereby the total share-based payment is expensed
over the vesting period. Refer to Note 21: Share-based Payments for further information.
• Other terms: The rights, restrictions and obligations which apply to Options, including in relation to vesting, disposal and
forfeiture, are pursuant to the terms of each Director’s engagement with the Company, and the option offer letters
accepted and signed by the Director at the time of the offer.
Dr Geoffrey Brooke – Non-Executive Chairman
During previous financial years, the following Director Options were granted to Dr Brooke, the key terms of which are outlined
below:
Grant Date
Quantity
Exercise Price
Expiry Date
Vesting Conditions:
Director Options
Director Options
28/11/2018
4,900,000
$0.085
27/11/2023
24/03/2017
5,000,000
$0.10
24/03/2025
4,900,000 options, issued at $0.085 each, to vest quarterly over a period of three years from the date of grant and is subject
to continuous service to the Company by Dr Brooke as a Non-Executive Director during the period from the date of grant up to
and including the applicable vesting dates. As at 30 June 2021, 4,083,333 options have vested and 816,667 options remain
unvested.
5,000,000 options, issued at $0.10 each, to vest as follows: 2,000,000 options to vest one year after the date of grant,
1,500,000 options to vest two years after the date of grant, and 1,500,000 options to vest three years after the date of grant.
These options are fully vested.
While there are no performance conditions attached to these options, the awards are reward for fulfilling the role of Non-
Executive Director of the Company and to provide adequate incentive for continued service to the Company.
Dr George Morstyn – Non-Executive Director
During previous financial years, the following Director Options were granted to Dr Morstyn, the key terms of which are outlined
below:
Grant Date
Quantity
Exercise Price
Expiry Date
Director Options
Director Options
28/11/2018
1,500,000
$0.085
27/11/2023
18/01/2018
1,500,000
$0.10
1/12/2022
Dr George Morstyn – Non-Executive Director (continued)
Vesting Conditions:
1,500,000 options, issued at $0.085 each, to vest quarterly over a period of three years from the date of grant and is subject to
continuous service to the Company by Dr Morstyn as a Non-Executive Director during the period from the date of grant up to
and including the applicable vesting dates. As at 30 June 2021, 1,250,000 options have vested and 250,000 options remain
unvested.
1,500,000 options, issued at $0.10 each, to vest as follows: 700,000 options to vest one year after the date of issue, 400,000
options to vest two years after the date of issue, and 400,000 options to vest three years after the date of issue. These
options fully vested during the year ended 30 June 2021. While the terms of Dr Morstyn’s engagement state that the vesting
periods commence from date of grant, the intention when granting the options, was that the vesting period would commence
from date of issue which was when he was appointed as a Non-Executive Director, this being 1 December 2017.
While there are no performance conditions attached to these options, the awards are reward for fulfilling the role of Non-
Executive Director of the Company and to provide adequate incentive for continued service to the Company.
Annual Financial Report 27
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
3. REMUNERATION ARRANGEMENTS (CONTINUED)
Mr Malcolm McComas – Non-Executive Director
During previous financial years, the following Director Options were granted to Mr McComas, the key terms of which are
outlined below:
Grant Date
Quantity
Exercise Price
Expiry Date
Vesting Conditions:
Director Options
4/04/2019
3,000,000
$0.10
4/04/2024
3,000,000 options, issued at $0.10 each, to vest quarterly over a period of three years from the date of grant and is subject to
continuous service to the Company by Mr McComas as a Non-Executive Director during the period from the date of grant up to
and including the applicable vesting dates. As at 30 June 2021, only 8 quarters have vested with the 9th quarter vesting
subsequent to year end, on 4 July 2021. For quantitative purposes, 2,000,000 options have vested and 1,000,000 options
remain unvested.
While there are no performance conditions attached to these options, the awards are reward for fulfilling the role of Non-
Executive Director of the Company and to provide adequate incentive for continued service to the Company.
Dr Bill Ketelbey – Former Managing Director and Chief Executive Officer – Resigned 8 February 2021
During a previous financial year, the following Director Options were granted to Dr Ketelbey, the key terms of which are
outlined below:
Grant Date
Quantity
Exercise Price
Expiry Date
Vesting Conditions:
Director Options
28/11/2018
11,700,000
$0.085
27/11/2023
11,700,000 options, issued at $0.085 each, were granted to Dr Ketelbey to vest quarterly over a period of three years from the
date of grant and were subject to continuous service to the Company. Due to cessation of employment with the Company on 8
February 2021, 2,925,000 unvested options lapsed due to the vesting conditions not being met, while the remaining 8,775,000
vested options remain issued to Dr Ketelbey.
(iii) Loan Shares
Dr Gourlay – Managing Director and Chief Executive Officer
During the year, Dr Steve Gourlay was issued 48,362,300 ordinary shares by way of provision of a limited recourse loan as part
of his employment with the Company on 15 March 2021. They carry voting and dividend rights however they also carry a
restriction on being able to trade. The total subscription price of these shares is $1,934,492, which equates to the “Loan
Amount”. However, given that these shares are considered to be “in-substance options” or “rights” under Generally Accepted
Accounting Principles, no loan amount is recognised in the financial statements.
These loan shares were issued with vesting conditions attached whereby there must be continuity of employment to receive
the vesting benefits. They have been valued using a Black-Scholes option pricing model, whereby the total share-based
payment is being expensed over the vesting period. Refer to Note 21: Share-based Payments for further information.
28 Actinogen Medical Limited
Vesting conditions:
•
•
24,181,150 shares at an issue price of 3.5 cents each share, vesting over three years provided that on each vesting date
that Dr Gourlay is in continuous employment with the Company, with 6,045,288 shares vesting on the 12-month
anniversary of commencement, and the remainder to vest in equal monthly increments over the next two years.
24,181,150 shares at an issue price of 4.5 cents each share, vesting over three years provided that on each vesting date
that Dr Gourlay is in continuous employment with the Company, with 6,045,288 shares vesting on the 12-month
anniversary of commencement, and the remainder to vest in equal monthly increments over the next two years.
• While there are no performance conditions attached to these loan shares, the awards are reward for fulfilling the role of
Chief Executive Officer and Managing Director of the Company and to provide adequate incentive for continued service to
the Company.
The key terms of the loan plan shares are as follows:
(x) the loan may only be applied towards the subscription price for the LTI Rights.
(xi) the loan will be interest free, provided that if the loan is not repaid by the repayment date set by the Board, the loan will
incur interest at a default interest rate per annum after that date which will accrue on a daily basis and compounds
annually on the then outstanding loan balance.
(xii) by signing and returning a limited recourse loan application, the participant of the Plan acknowledges and agrees that the
Loan Shares will not be transferred, encumbered, otherwise disposed of, or have a security interest granted over it, by or
on behalf of the Participant until the loan is repaid in full to the Company.
(xiii) the Company has security over the Loan Shares as security for repayment of the loan;
(xiv) the Outstanding Loan Balance becomes due and payable (unless extended by the Company in its absolute discretion) on
the first to occur of the following:
(a) 90 days after the Continuous Employment (or other permitted engagement) of the Participant ceases for any reason,
(b) by the legal personal representative of the Participant, 120 days after the Participant ceases to be an employee,
officer or director of the Company due to their death, and
(c) the Repayment Date: which is 5 years from the date on which the Company advances the Loan to the Participant.
Annual Financial Report 29
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
4. KEY MANAGEMENT PERSONNEL REMUNERATION OUTCOMES AND PERFORMANCE DURING THE FINANCIAL YEAR
During the financial years ended 30 June 2021 and 30 June 2020 (as set out in Table 1 and Table 2 below, respectively), KMP’s received either or all of the following benefits: short-term benefits: cash
salary, cash fees and cash bonuses, post-employment benefits, other long-term benefits, and share-based payments. All remuneration has been valued at the cost to the Company and expensed.
Table 1: Remuneration of KMP for the year ended 30/6/2021
Short-term
benefits
Termination
benefits
Post-
employment
Long-term
benefits
Share-based
payments
Key
Management
Personnel
Cash, salary
and fees
$
Cash
Bonus (f)
$
Termination
payments
$
Super-
annuation
$
Accrued leave
benefits
$
LTI Rights /
Options
$
Shares
$
Total
$
Geoffrey Brooke (a)
95,890
-
-
9,110
-
23,193
-
128,193
Steven Gourlay (b)
112,395
-
-
7,116
8,648
142,909
-
271,068
Bill Ketelbey (c)
210,480
-
238,014
18,900
16,186
41,535
-
525,115
George Morstyn (a)
63,000
-
-
-
-
7,825
-
70,825
Malcolm McComas (a)
63,000
-
-
-
-
14,132
-
77,132
Tamara Miller
Jeff Carter (d)
Total KMP (e)
270,000
73,500
-
21,694
21,909
21,067
-
408,170
94,275
-
-
-
-
7,602
-
101,877
909,040
73,500
238,014
56,820
46,743
258,263
-
1,582,380
Value of
SBP as a
% of total
remuneration
%
% of total
remuneration /
performance-
related
%
18%
53%
8%
11%
18%
5%
7%
18%
53%
8%
11%
18%
23%
7%
(a) The total Non-Executive Director fees including superannuation during the year totalled $231,000.
(b) Dr Gourlay commenced full-time employment as Chief Executive Officer of the Company on 15 March 2021.
(c) Dr Ketelbey resigned on 8 February 2021. Termination payments totalling $238,014 comprise: $86,451 covering the three-month notice period, $35,000 STI bonus fee, $81,116 in unused annual
leave accrued up to the date of resignation, and $35,447 in prorated long service leave benefits for approximately 6 years of service with the Company. Long-term benefits of $16,186 relate to
unused annual leave accrued during the financial year.
(d) Mr Carter was appointed as the Chief Financial Officer of the Company on 21 September 2020.
(e) For detailed information of KMP employment arrangements, refer to Section 5 and Section 6 of the Remuneration Report.
(f) For information on short-term incentive cash bonuses, refer to Section 3(C)(a).
30 Actinogen Medical Limited
Table 2: Remuneration of KMP for the year ended 30/6/2020
Short-term
benefits
Termination
benefits
Post-
employment
Long-term
benefits
Share-based
payments
Key
Management
Personnel
Cash, salary
and fees
$
Cash
Bonus
$
Termination
payments
$
Super-
annuation
$
Accrued leave
benefits
$
Options
Shares
$
$
Total
$
Geoffrey Brooke (a)
93,607
-
- 8,893
-
47,996
-
150,496
Bill Ketelbey (b)
311,087
63,200
- 24,202
26,660
55,380
-
480,529
George Morstyn (a)
61,500
-
-
-
-
9,912
-
71,412
Malcolm McComas (a)
61,500
-
-
-
-
14,132
-
75,632
Total KMP
527,694
63,200
-
33,095
26,660
127,420
-
778,069
Value of
SBP as a
% of total
remuneration
%
% of total
remuneration /
performance-
related
%
32%
12%
14%
19%
32%
25%
14%
19%
(a) The total Non-Executive Director fees including superannuation during the year totalled $225,500.
(b) Dr Ketelbey was on a total employment cost basis (inclusive of superannuation guarantee) of $350,000 that increased to $367,500 (with effect from 1 January 2020) and was entitled to four
weeks annual leave.
Annual Financial Report 31
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
5. EXECUTIVE EMPLOYMENT AGREEMENTS
During the financial year the following executives were remunerated for their roles in the Company and were subject to the
following contractual arrangements:
Dr Steven Gourlay – Managing Director and Chief Executive Officer
• Commencement of employment: 15 March 2021.
•
•
•
•
Remuneration package: A total employment cost basis (inclusive of superannuation guarantee) of $400,000 with four
weeks annual leave entitlement.
A specific short-term incentive component is also provided for within the Managing Director’s remuneration package.
Currently this an annual bonus subject to satisfying performance objectives to be determined by the Board in its discretion
annually. The target incentive bonus will be up to a maximum of 35% of Base Salary, prorated to the date of
commencement of Employment for the first year and the Board's determination of whether the performance objectives
have been achieved will be final and binding on the Employee. The Board may (but without assuming any obligation in
future periods) for an exceptional performance in any year as determined by the Board in its discretion, award a bonus in
excess of 35% of Base Salary.
Term: The appointment of the employee will continue on an ongoing basis unless terminated earlier in accordance with
termination provisions.
Termination: The Company or the individual may terminate the contract by giving three months’ written notice. In the
event of breach or criminal activity, termination is effective immediately without payment other than the fee accrued to
the date of termination.
Dr Bill Ketelbey – Managing Director and Chief Executive Officer
• Commencement of employment: 18 December 2014.
• Cessation of employment: 8 February 2021 in accordance with termination provisions.
•
•
•
•
Remuneration package: A total employment cost basis (inclusive of superannuation guarantee) of $367,500 with four
weeks annual leave entitlement.
Included within the remuneration package was an STI scheme which was put in place by the Board of Directors for the
achievement of a number of various short-term performance conditions being met. For further information on the STI’s
refer to Section 3(C)(a) of the Remuneration Report.
Term: The appointment of the employee will continue on an ongoing basis unless terminated earlier in accordance with
termination provisions.
Termination: The Company or the individual may terminate the contract by giving three months’ written notice. However,
the Company at its sole discretion paid Dr Ketelbey upfront in lieu of the required three months’ notice period, in
accordance with termination provisions,
Ms Tamara Miller – Vice President of Drug Development & Strategy
• Commencement of employment: 21 September 2017.
•
•
•
•
Role: upon commencement of employment Ms Miller fulfilled the role of Director of Drug Development. On 1 April 2018,
she was promoted to Senior Director of Clinical Development and Strategy. Since then, she was promoted to her current
role of Vice President of Drug Development & Strategy on 1 June 2019.
Remuneration package: During the year ended 30 June 2021, Ms Miller was on a total employment cost basis (inclusive of
superannuation guarantee) of $291,694 with four weeks annual leave entitlement. With effect from 1 July 2021, Ms Miller’s
total employment cost basis was increased to $301,668
Included within the remuneration package is an STI scheme which is put in place by the Board of Directors for the
achievement of a number of various short-term performance conditions being met. For further information on the STI’s
refer to Section 3(C)(a) of the Remuneration Report.
Term: The appointment of the employee will continue on an ongoing basis unless terminated earlier in accordance with
termination provisions.
32 Actinogen Medical Limited
Ms Tamara Miller – Vice President of Drug Development & Strategy (continued)
•
Termination: The Company or the individual may terminate the contract by giving four weeks’ written notice. In the event
of breach or criminal activity, termination is effective immediately without payment other than the fee accrued to the date
of termination.
Mr Jeff Carter – Chief Financial Officer
• Commencement of consultancy: 21 September 2020
Remuneration package set at a daily rate of $1,675 (plus GST and exclusive of superannuation). The Consultant may not
•
charge for more than an average 8-days service per calendar month over a 12-month period. However, subject to prior
agreement with the Company, an additional charge may be applied for excess hours served beyond the monthly cap of 8 days.
Termination: The Company or Consultant may terminate the contract by giving one month’s written notice. In the event of
•
breach or criminal activity, termination is effective immediately without payment other than the fee accrued to the date of
termination.
6. NON-EXECUTIVE DIRECTOR FEE ARRANGEMENTS
Non-Executive Directors
Non-Executive Directors are remunerated by way of fees, in the form of cash, non-cash benefits and superannuation
contributions and do not normally participate in schemes designed for the remuneration of executives. As noted above, fees
for Non-Executive Directors are generally not directly linked to the performance of the Company, however, to align Directors’
interests with shareholder interests, the Directors are encouraged to hold shares in the Company.
The maximum aggregate remuneration approved by shareholders for Non-Executive Directors, at an Annual General Meeting
held on 12 November 2015, is $500,000 per annum. The Directors set the individual Non-Executive Directors fees within the
limit approved by shareholders. Total fees, including superannuation, paid to Non-Executive Directors during the year were
$231,000.
During the financial year the following Non-Executive Directors were remunerated for their respective roles and were subject
to the following contractual arrangements:
Dr Geoffrey Brooke – Non-Executive Chairman
• Date of Appointment: 1 March 2017.
•
•
•
Remuneration package set at $105,000 per annum (plus GST, inclusive of statutory superannuation) with effect from 1
January 2020. Subject to annual review.
Term: Dr Brooke’s appointment is subject to retirement by rotation under the Company’s Constitution.
Termination: The other members of the Board may request that the officer resign with immediate effect in the event that
the Board deems the individual’s performance is unsatisfactory, or the Company’s shareholders may resolve to seek the
officer’s removal by members’ resolution. Alternatively, the individual may resign from the Board.
Dr George Morstyn – Non-Executive Director
• Date of Appointment: 1 December 2017.
•
•
•
Remuneration package set at $63,000 per annum (plus GST and exclusive of superannuation) with effect from 1 January
2020. Subject to annual review.
Term: Dr Morstyn’s appointment is subject to retirement by rotation under the Company’s Constitution.
Termination: The other members of the Board may request that the officer resign with immediate effect in the event that
the Board deems the individual’s performance is unsatisfactory, or the Company’s shareholders may resolve to seek the
officer’s removal by members’ resolution. Alternatively, the individual may resign from the Board.
Mr. Malcolm McComas – Non-Executive Director
• Date of Appointment: 4 April 2019.
•
•
•
Remuneration package set at $63,000 per annum (plus GST and exclusive of superannuation) with effect from 1 January
2020. Subject to annual review.
Term: Dr McComas’ appointment is subject to retirement by rotation under the Company’s Constitution.
Termination: The other members of the Board may request that the officer resign with immediate effect in the event that
the Board deems the individual’s performance is unsatisfactory, or the Company’s shareholders may resolve to seek the
officer’s removal by members’ resolution. Alternatively, the individual may resign from the Board.
Annual Financial Report 33
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
7. DISCLOSURES RELATING TO OPTIONS
At the date of this Report, the unissued ordinary shares of Actinogen Medical under option carry no dividend or voting rights.
When exercisable, each option is convertible into one fully paid ordinary share of the Company.
(i) Option holdings of KMP as at 30 June 2021:
Balance at
beginning of
year 1/7/2020
Granted as
remuneration
Net change
other
Balance at
end of year
30/6/2021
Vested at
30/6/2021
Not vested at
30/6/2021
KMP
Geoffrey Brooke
Director Options (10c)
5,000,000
-
-
5,000,000
5,000,000
-
Director Options (8.5c)
4,900,000
-
-
4,900,000
4,083,333
816,667
9,900,000
-
- 9,900,000
9,083,333
816,667
Steven Gourlay (a)
Loan Shares (3.5c)
-
24,181,150
-
24,181,150
-
24,181,150
Loan Shares (4.5c)
-
24,181,150
-
24,181,150
-
24,181,150
- 48,362,300
- 48,362,300
-
48,362,300
Bill Ketelbey (b)
Director Options (8.5c)
11,700,000
-
(11,700,000)
-
-
-
11,700,000
- (11,700,000)
-
-
-
George Morstyn
Director Options (10c)
1,500,000
-
-
1,500,000
1,500,000
-
Director Options (8.5c)
1,500,000
-
-
1,500,000
1,250,000
250,000
3,000,000
-
-
3,000,000
2,750,000
250,000
Malcolm McComas
Director Options (10c)
3,000,000
-
-
3,000,000
2,000,000
1,000,000
3,000,000
-
-
3,000,000
2,000,000
1,000,000
Tamara Miller
Employee Options (8.5c)
4,000,000
-
-
4,000,000
3,333,333
666,667
Employee Options (10c) (c)
974,610
-
(974,610)
-
-
-
4,974,610
-
(974,610)
4,000,000
3,333,333
666,667
Jeff Carter
Employee Options (4.6c)
-
1,600,000
-
1,600,000
-
1,600,000
Total KMP Holding
32,574,610
49,962,300
(12,674,610) 69,862,300
17,166,666
52,695,634
-
1,600,000
-
1,600,000
-
1,600,000
(a) The 48,362,300 shares on issue to Dr Gourlay, which he received as remuneration upon commencement of employment
on 15 March 2021, are issued ordinary shares that carry voting and divided rights however they also carry a restriction on
being able to trade and have therefore, been accounted for as “in-substance options”. Refer to Section 3(C)(b)(iii) within
the Remuneration Report for information on these loan shares.
(b) On 8 February 2021 Dr Ketelbey resigned from the Company and was no longer considered a KMP.
(c) On 5 February 2021, 974,610 options previously issued to Ms Miller at $0.10 per option expired.
34 Actinogen Medical Limited
(ii) Value of options awarded, vested and lapsed during the financial year
KMP
Quantity
Geoffrey Brooke
Total
share-based
payment
valuation
Value
vested during
the year
Total share-
based payments
expensed as at
1 July 2020
Value
recognised
during the year
Value
lapsed
during the year
Total share-
based payments
expensed as at
30 June 2021
Value to be
recognised in
future years
Remuneration
consisting of
option for the
year (%)
Director Options (10c)
5,000,000
$245,286
-
$245,286
-
Director Options (8.5c)
4,900,000
$69,580
$23,193
$34,790
$23,193
Steven Gourlay (a)
Loans Shares (3.5c)
24,181,150
$383,027
Loan Shares (4.5c)
24,181,150
$350,963
-
-
-
-
$74,576
$68,333
-
-
-
-
$245,286
$57,983
-
$11,597
$74,576
$68,333
$308,451
$282,630
Bill Ketelbey
Director Options (8.5c)
8,775,000
$124,605
$41,535
$83,070
$41,535
$(41,535)
$124,605
George Morstyn
Director Options (10c)
1,500,000
Director Options (8.5c)
1,500,000
$19,350
$21,300
-
$7,100
$18,625
$10,650
$ 725
$7,100
Malcolm McComas (b)
Director Options (10c)
3,000,000
$42,396
$10,599
$17,665
$14,132
-
-
$3,550
$19,350
$17,750
$31,797
$10,599
$52,667
$10,533
-
-
-
-
Tamara Miller
Employee Options (8.5c)
4,000,000
Employee Options (10c)
974,610
$63,200
$12,489
Jeff Carter (c)
Employee Options (4.6c)
1,600,000
$14,948
$21,067
-
-
$31,600
$12,489
$21,067
-
$(12,489)
-
-
-
$7,602
-
$7,602
$7,345
Total KMP
$1,347,144
$103,494
$454,175
$258,263
$(54,024)
$699,949
$634,705
(a) Of Dr Gourlay’s 48,362,300 loan shares, 12,090,576 shares will vest on the 12-month anniversary of commencement, and the remainder will vest in equal monthly increments over the next two
years. Subsequently, the value of $142,909 recognised during the year represents the prorated share-based payment expense, it does not reflect the value vested.
(b) Mr McComas’ 3,000,000 Director Options vest every quarter subsequent to grant date: 4 July 2019. During the 2021 financial year, when calculating the share-based payment expense attached
to these options, the expense has been prorated up to 30 June 2021, with a value of $14,132 recognised. However, for quantitative purposes 2,000,000 options have vested and 1,000,000
remain unvested at 30 June 2021.
(c) Of Mr Carter’s 1,600,000 option, 533,333 (one-third) will vest 12 months from date of grant, with the balance of 1,066,667 (two-thirds) to vest quarterly thereafter. Subsequently, the value of
$7,602 recognised during the year represents the prorated share-based payment expense, it does not reflect the value vested.
Annual Financial Report 35
0%
18%
28%
25%
8%
1%
10%
18%
5%
0%
7%
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
(iii) Number of options awarded, vested and lapsed during the financial year
Fair value per
option at
grant date
Financial
Year
Vesting date
Exercise
price
Expiry
date
Quantity
as at
1 July 2020
Quantity issued,
converted,
lapsed or
changed during
the year (a)(b)
Quantity
as at
30 June
2021
Quantity
vested
during the
year
Quantity
unvested
as at 30
June 2021
KMP
Grant Date
Geoffrey Brooke
Director Options (10c)
24/03/2017
$ 0.049
2017
Fully Vested
$ 0.100 24/03/2025
5,000,000
-
5,000,000 -
-
Director Options (8.5c)
28/11/2018
$ 0.014
2019 Section 3(C)(b)(ii)
$ 0.085 27/11/2023
4,900,000
-
4,900,000 816,667
816,667
Steven Gourlay
Loans Shares (3.5c)
15/03/2021
$ 0.016
2021 Section 3(C)(b)(iii)
$ 0.035 15/03/2026
-
24,181,150
24,181,150 -
24,181,150
Loan Shares (4.5c)
15/03/2021
$ 0.015
2021 Section 3(C)(b)(iii)
$ 0.045 15/03/2026
-
24,181,150
24,181,150 -
24,181,150
Bill Ketelbey
Director Options (8.5c)
28/11/2018
$ 0.014
2019 Section 3(C)(b)(ii)
$ 0.085 27/11/2023
11,700,000
(11,700,000)
-
975,000
-
George Morstyn
Director Options (10c)
18/01/2018
$ 0.013
2018
Fully Vested
$ 0.100
1/12/2022
1,500,000
-
1,500,000
400,000
-
Director Options (8.5c)
28/11/2018
$ 0.014
2019 Section 3(C)(b)(ii)
$ 0.085 27/11/2023
1,500,000
-
1,500,000
250,000
250,000
Malcolm McComas
Director Options (10c)
4/04/2019
$ 0.014
2019 Section 3(C)(b)(ii)
$ 0.100 4/04/2024
3,000,000
-
3,000,000
750,000
1,000,000
Tamara Miller
Employee Options (8.5c)
12/12/2018
$ 0.0158
2019
Section 3(C)(b)(i)
$ 0.085 12/12/2023
4,000,000
-
4,000,000
1,333,333
666,667
Employee Options (10c)
20/03/2018
$ 0.0128
2018
Section 3(C)(b)(i)
$ 0.100
5/02/2021
974,610
(974,610)
- -
-
Jeff Carter
Employee Options (4.6c)
28/09/2020
$ 0.0093
2021
Section 3(C)(b)(i)
$ 0.046 27/09/2025
-
1,600,000
1,600,000 -
1,600,000
Total KMP
32,574,610
37,287,690 69,862,300 4,525,000 52,695,634
(a) Steve Gourlay received 48,362,300 loan shares as remuneration upon commencement of employment on 15 March 2021.
(b) Bill Ketelbey resigned from the Company on 8 February 2021. Of the 11,700,000 Director options issued to him, 8,775,000 options had vested while the remaining 2,925,000 unvested options
lapsed due to the vesting conditions not being met at the date of his employment ceasing.
36 Actinogen Medical Limited
8. DISCLOSURES RELATING TO SHARES
The shareholding of KMP as at 30 June 2021 is as follows:
Balance at
beginning of
year
1/7/2020
KMP
Granted as
remuneration
On exercise
of options
Accounted
for as options
(f)
Net change
other
Balance at
end of year
30/6/2021
Geoffrey Brooke (a)
1,325,000
-
-
- 265,000
1,590,000
Steven Gourlay (b)
-
-
-
- 15,000,000
15,000,000
Bill Ketelbey (c)
9,953,803
-
-
- (9,953,803)
-
George Morstyn (d)
200,000
-
-
-
2,590,000
2,790,000
Malcolm McComas (e)
500,000
-
-
-
100,000
600,000
Tamara Miller
-
-
-
-
-
-
Jeff Carter
-
-
-
-
-
-
Total share holding
11,978,803
-
-
-
8,001,197 19,980,000
(a) Dr Brooke purchased 265,000 fully paid ordinary shares under the Rights Issue on 17 November 2020.
(b) Dr Gourlay purchased 15,000,000 fully paid ordinary shares under the Shortfall Placement on 10 February 2021.
(c) Dr Ketelbey ceased employment with the Company on 8 February 2021.
(d) Dr Morstyn purchased 40,000 fully paid ordinary shares under the Rights Issue on 17 November 2020, and 2,550,000
fully paid ordinary shares on-market.
(e) Mr McComas purchased 100,000 fully paid ordinary shares under the Rights Issue on 17 November 2020.
(f)
There are 48,362,300 shares on issue to Dr Gourlay which he received as remuneration upon commencement of
employment on 15 March 2021. Although they are issued ordinary shares that carry voting and divided rights, they also
carry a restriction on being able to trade and have therefore, been accounted for as “in-substance options”. Refer to
Section 3(C)(b)(iii) within the Remuneration Report for information on these loan shares, and Section 7 above for how
these shares have been accounted for as options in respect of value and quantity.
9. LOANS MADE TO KMP AND THEIR RELATED PARTIES
During the year, a limited recourse interest free loan was provided to Dr Gourlay in the form 48,362,300 Loan Shares (aka. LTI
Rights). Due to the nature of these loans, they were not accounted for as loans, rather they were accounted for as “in-
substance options”. As at 30 June 2021, there are no other loans held with any other KMP or any of their related entities.
10. OTHER TRANSACTIONS AND BALANCES WITH KMP AND THEIR RELATED PARTIES
There were no other transactions with any Director or KMP or any of their related entities during the year.
11. CONSEQUENCES OF PERFORMANCE ON SHAREHOLDER’S WEALTH
The table below sets out the performance of the Company and the consequences of share price performance on shareholders’
wealth over the past five years as at 30 June year-end:
Quoted price of ordinary shares at year end (cents)
12.0
2.2
1.0
4.8
6.0
Loss per share (cents)
Dividends paid
0.28
0.48
0.90
0.88
0.88
-
-
-
-
-
2021
2020
2019
2018
2017
End of Remuneration Report (Audited)
Annual Financial Report 37
Directors’ Report (continued)
12.
INDEMNIFICATION OF AUDITORS
To the extent permitted by law, the Company has agreed to indemnify its auditors, Ernst & Young, as part of the terms of its audit
engagement agreement against claims by third parties arising from the audit (for an unspecified amount). No payment has been
made to indemnify Ernst & Young during or since the financial year.
13.
INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS
During the financial year, Actinogen Medical paid a total of $45,206 (comprising $21,972 for renewal and $23,234 excess) to
insure the Directors and officers of the Company. The liabilities insured are legal costs that may be incurred in defending civil or
criminal proceedings that may be brought against the officers in their capacity as officers in the Company, and any other
payments arising from liabilities incurred by the officers in connection with such proceedings.
This does not include such liabilities that arise from conduct involving a wilful breach of duty by the officers or the improper use by
the officers of their position or of information to gain advantage for themselves or someone else or to cause detriment to the
Company. It is not possible to apportion the premium between amounts relating to the insurance against legal costs and those
relating to other liabilities.
14. PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied for leave of Court, under section 237 of the Corporations Act 2001, to bring proceedings on behalf of the
Company or intervene in any proceedings to which the Company is party for the purpose of taking responsibility on behalf of the
Company for all or part of these proceedings. The Company was not a party to any such proceedings during the year.
15. ENVIRONMENTAL REGULATIONS
The Company's operations are not subject to significant environmental regulation under the Australian Commonwealth or State
law.
16. AUDIT & NON-AUDIT SERVICES
Total amounts paid or payable to the external auditors and their associated entities for an audit or review of the financial
statements of the Company during the financial year ended 30 June 2021 totalled $43,265 (2020: 40,800).
Total non-audit services paid to the external auditors and their associated entities during the year ended 30 June 2021 was $Nil
(2020: $2,600).
17. AUDITOR’S INDEPENDENCE DECLARATION
The Auditor’s Independence Declaration as required under section 307C of the Corporations Act 2001 for the year ended 30 June
2021 forms a part of the Directors’ Report and can be found on page 39. Signed in accordance with a resolution of the Board of
Directors.
Dr Steven Gourlay
Managing Director
Sydney, New South Wales
Monday, 30 August 2021
38 Actinogen Medical Limited
Auditor’s Independence Declaration
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Auditor’s independence declaration to the directors of Actinogen
Medical Limited
As lead auditor for the audit of the financial report of Actinogen Medical Limited for the financial year
ended 30 June 2021, I declare to the best of my knowledge and belief, there have been:
a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
b) no contraventions of any applicable code of professional conduct in relation to the audit.
Ernst & Young
Pierre Dreyer
Partner
30 August 2021
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
PD:ET:ACTINOGEN:008
39
Annual Financial Report
Financial Report
Statement of Comprehensive Income
Statement of Financial Position
Statement in Changes of Equity
Statement of Cash Flows
Notes to the Financial Statements
1.
2.
3.
4.
Corporate information
Summary of significant accounting policies
Segment information
Financial risk management
5. Critical accounting estimates and judgements
6. Other income and expenses
7.
Income tax
8. Cash and cash equivalents
9. Other receivables
10. Property, plant and equipment
11. Right-of-use asset & lease liability
12.
Intangible assets
13. Trade and other payables
14. Contributed equity
15. Reserves
16. Losses per share
17. Commitments and contingencies
18. Remuneration of auditor
19. Related party transactions
20. Key management personnel disclosures
21. Share-based payments
Directors’ Declaration
Independent Auditor’s Report
41
42
43
44
45
45
45
51
51
54
55
56
57
58
58
59
60
61
61
63
63
63
64
64
64
65
66
67
40 Actinogen Medical Limited
Statement of Comprehensive Income
For the year ended 30 June 2021
Interest revenue
Other income
Full year ended
30/06/2021
Full year ended
30/06/2020
Note
$
$
27,090
94,057
1,984,072
3,516,397
Total revenue & other income
6
2,011,162
3,610,454
Research & development costs
6
(2,406,237)
(5,537,170)
Employment costs
(1,704,953)
(1,538,700)
Corporate & administration costs
(1,116,744)
(1,228,810)
Finance costs
(22,318)
(28,882)
Share-based payment expenses
(289,282)
(194,488)
Amortisation expense
12
(312,747)
(313,602)
Depreciation expense (right-of-use asset)
11(a)
(65,728)
(95,112)
Depreciation expense (office equipment)
10
(8,220)
(4,219)
Total expenses
Loss before income tax
Income tax expense
Loss for the year
(5,926,229)
(8,940,983)
(3,915,067)
(5,330,529)
-
-
(3,915,067)
(5,330,529)
Other comprehensive income
Items that may be reclassified subsequently to profit and
loss:
Other comprehensive income
-
-
Total comprehensive loss for the year
(3,915,067)
(5,330,529)
Loss per share for attributable to the ordinary equity
holders of the Company
Basic and diluted loss per share (cents)
16
(0.28)
(0.48)
The above Statement of Comprehensive Income should be read in conjunction with the accompanying Notes.
Annual Financial Report 41
Statement of Financial Position
As at 30 June 2021
CURRENT ASSETS
Cash and cash equivalents
Other receivables
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Property, plant and equipment
Intangible assets
As at
30/06/2021
As at
30/06/2020
Note
$
$
8
9
10
12
13,421,653
5,040,486
1,634,322
3,123,428
15,055,975
8,163,914
16,509
18,541
3,033,204
3,345,951
Other receivable - restricted cash
35,266
35,266
Right-of-use assets
11
237,448
372,501
TOTAL NON-CURRENT ASSETS
3,322,427
3,772,259
TOTAL ASSETS
18,378,402
11,936,173
CURRENT LIABILITIES
Trade and other payables
Provision for employee entitlements
Lease liability
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
13
11(c)
619,573
509,275
64,307
148,523
71,170
86,018
755,050
743,816
Lease liability
11(c)
165,271
303,852
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
165,271
303,852
920,321
1,047,668
NET ASSETS
17,458,081
10,888,505
EQUITY
Contributed equity
Reserve shares
Reserves
Accumulated losses
TOTAL EQUITY
14
14
15
60,054,459
47,924,606
(1,934,492)
-
7,780,027
7,490,745
(48,441,913)
(44,526,846)
17,458,081
10,888,505
The above Statement of Financial Position should be read in conjunction with the accompanying Notes.
42 Actinogen Medical Limited
Statement in Changes of Equity
For the year ended as at 30 June 2021
Full year ended 30 June 2021
Contributed
Equity
$
Accumulated
Losses
$
Option
Reserve
$
Reserve
Shares
$
Total
$
Balance as at 1 July 2020
47,924,606
(44,526,846) 7,490,745
-
10,888,505
Loss for the year
-
(3,915,067)
-
-
(3,915,067)
Other comprehensive income
-
-
-
-
-
Total comprehensive loss for the year
-
(3,915,067)
-
-
(3,915,067)
Transactions with equity holders in their
capacity as equity holders:
Shares issued during the year
12,845,721
-
-
(1,934,492)
10,911,229
Capital raising costs
(715,868)
-
-
-
(715,868)
Share-based payments
-
-
289,282
-
289,282
Balance as at 30 June 2021
60,054,459
(48,441,913) 7,780,027
(1,934,492)
17,458,081
Full year ended 30 June 2020
Contributed
Equity
$
Accumulated
Losses
$
Option
Reserve
$
Reserve
Shares
$
Total
$
Balance as at 1 July 2019
48,044,606
(39,196,317)
7,296,257
(480,000)
15,664,546
Loss for the year
-
(5,330,529)
-
-
(5,330,529)
Other comprehensive income
-
-
-
-
-
Total comprehensive loss for the year
-
(5,330,529)
-
-
(5,330,529)
Transactions with equity holders in their
capacity as equity holders:
Repayment of Loan Shares (LTI Rights)
-
-
-
360,000 360,000
Cancellation of Loan Shares (LTI Rights) upon
cessation of employment
(120,000)
-
- 120,000
-
Share-based payments
-
-
194,488
-
194,488
Balance as at 30 June 2020
47,924,606
(44,526,846) 7,490,745
- 10,888,505
The above Statement of Changes in Equity should be read in conjunction with the accompanying Notes.
Annual Financial Report 43
Full year ended
30/06/2021
$
Full year ended
30/06/2020
$
94,057
(28,882)
(1,151,125)
(7,227,705)
5,458,042
(2,855,613)
(22,760)
(22,760)
-
-
360,000
(77,742)
282,258
(2,596,115)
7,636,601
5,040,486
Statement of Cash Flows
For the year ended 30 June 2021
CASH FLOWS FROM OPERATING ACTIVITIES
Interest received
Interest paid
Payments to suppliers and employees
Payments for research and development
Government R&D tax rebate & grants received
Net cash outflow from operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment
Net cash outflow from investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of shares
Transaction costs associated with issue of shares
Proceeds received on repayment of loan shares
Note
11(b)
10
14
14
Principal repayment on leases
11(b)
Net cash inflow from financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of the year
27,090
(18,054)
(1,290,872)
(3,470,266)
3,028,200
(1,723,902)
(6,188)
(6,188)
10,911,229
(715,868)
-
(84,104)
10,111,257
8,381,167
5,040,486
Cash and cash equivalents at the end of the year
8
13,421,653
The above Statement of Cash Flows should be read in conjunction with the accompanying Notes.
44 Actinogen Medical Limited
Notes to the Financial Statements
For the year ended 30 June 2021
1. CORPORATE INFORMATION
The financial statements of Actinogen Medical Limited (Actinogen Medical or the Company) for the year ended 30 June 2021
were authorised in accordance with a resolution of Directors on 30 August 2021.
Actinogen Medical is a for profit company limited by shares incorporated and domiciled in Australia whose shares are publicly
traded on the Australian Securities Exchange (ASX). The nature of operations and principal activities of the Company are
described in the Directors’ Report. The registered office of the Company is located at Suite 901, Level 9, 109 Pitt Street,
Sydney, NSW, Australia.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies adopted in the preparation of these financial statements are set out below. These policies
have been consistently applied to all the years presented, unless otherwise stated below. The financial statements of the
Company are for the financial year ended 30 June 2021.
(a) Basis of preparation
These general-purpose financial statements have been prepared in accordance with Australian Accounting Standards, other
authoritative pronouncements of the Australian Accounting Standards Board, and the Corporations Act 2001. The financial
statements have been prepared on a going concern basis. The financial statements are presented in Australian dollars.
(b) Going concern basis
This financial report has been prepared on the going concern basis after taking into consideration the net loss after tax for the
year ended 30 June 2021 of $3,915,067 and the net cash outflows from operating activities of $1,723,902. The going concern
basis contemplates the continuity of normal business activity and the realisation of assets and settlement of liabilities in the
normal course of business.
In forming this view the Directors have taken into consideration the following:
•
•
The Company has $13,421,653 in cash and cash equivalents as at 30 June 2021. This amount does not include the
proposed claim for the Research and Development Tax Incentive which is estimated to lead to a cash refund of $1,438,571
(refer Note 9: Other receivables). Further, the Company is listed on the ASX and therefore has access to the Australian
equity capital markets. Accordingly, the Directors consider that the Company maintains a reasonable expectation of being
able to raise funding from the market as and when required, although it cannot determine in advance the terms upon
which it may raise such funding.
The Directors have confidence in the ability of Actinogen Medical to successfully continue development of its lead
molecule, Xanamem, and eventually generate positive cash flows from operations and/or alliances. Firstly, a large safety
database for the Phase 2 stage has been generated by trials in more than 220 patients or volunteers. Secondly, pivotal
positron emission tomography data have shown high levels of target occupancy in the brain of doses as low as 5mg daily,
pointing the company to a broader and lower dose range for future studies. Thirdly, the XanaHES randomised, placebo-
controlled trial, demonstrated Xanamem’s activity to improve cognition within four weeks, as measured by a computerised
neurological test.
(c) COVID-19 pandemic
In March 2020, the World Health Organisation declared the outbreak of COVID-19 as a pandemic. The Company has
commenced Part A of the XanaMIA trial and will commence future trials including Part B of the XanaMIA trial in patients with
Alzheimer’s Disease and a trial in patients with Fragile X. Continued outbreaks of COVID-19 may cause clinical trial disruption.
There is uncertainty around the potential consequences of COVID-19 disruptions and as such the Company is unable to
determine if such disruptions would have a material impact on its clinical trials.
(d) Compliance with IFRS
The financial statements of the Company also comply with International Financial Reporting Standards (IFRS) as issued by the
International Accounting Standards Board (IASB).
(e) Historical cost convention
These financial statements have been prepared under the historical cost convention.
Annual Financial Report 45
Notes to the Financial Statements
(continued)
(f) Critical accounting estimates and judgements
The preparation of financial statements requires the use of certain critical accounting estimates. It also requires management
to exercise its judgement in the process of applying the Company’s accounting policies. The areas involving a higher degree of
judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in
Note 5.
(g) Plant & equipment
Each asset of plant and equipment is stated at cost, net of accumulated depreciation and impairment losses, if any. Assets are
depreciated from the date the asset is ready for use. Items of plant and equipment are depreciated using the diminishing value
method over their estimated useful lives to the Company. The depreciation rates used for each class of asset for the current
period are as follows:
• Computer Equipment 25% to 66.67%
An asset is de-recognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain
or loss arising on de-recognition of the asset (calculated as the difference between the net disposal proceeds and the carrying
amount of the asset) is included in the Statement of Comprehensive Income when the asset is de-recognised. The assets’
residual values, useful lives and methods of depreciation are reviewed, and adjusted if appropriate, at each balance date.
(h) Impairment of non-financial assets
At each reporting date, the Company reviews the carrying values of its assets to determine whether there is any indication that
those assets have been impaired. If such an indication exists, the recoverable amount of the asset, being the higher of the
asset’s fair value less costs of disposal and value in use, is compared to the assets carrying value. Any excess of the assets
carrying value over its recoverable amount is expensed to the Statement of Comprehensive Income. Where it is not possible to
estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash-
generating unit to which the asset belongs.
In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate
that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair
value less cost of disposal, recent market transactions are taken into account. If no such transactions can be identified, an
appropriate valuation model is used. These calculations are corroborated by valuation multiples, quoted share prices for
publicly traded companies or other available fair value measures.
(i)
Intangible assets
Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in a
business combination is their fair value at the date of acquisition. Following initial recognition, intangible assets are carried at
cost less any accumulated amortisation and accumulated impairment losses. Internally generated intangibles, excluding
capitalised development costs, are not capitalised and the related expenditure is reflected in profit or loss in the period in
which the expenditure is incurred.
The useful lives of intangible assets are assessed as either finite or indefinite. Intangible assets with finite lives are amortised
over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be
impaired. The amortisation period and the amortisation method for an intangible asset with a finite useful life are reviewed at
least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption of future
economic benefits embodied in the asset are considered to modify the amortisation period or method, as appropriate, and are
treated as changes in accounting estimates and adjusted on a prospective basis. The amortisation expense on intangible
assets with finite lives is recognised in the Statement of Comprehensive Income.
Intangible assets with indefinite useful lives are not amortised, but are tested for impairment annually, and when indicators of
impairment exist, individually or at the cash-generating unit level. The assessment of indefinite life is reviewed annually, or
when indicators of impairment exist, to determine whether the indefinite life continues to be supportable. If not, the change in
useful life from indefinite to finite is made on a prospective basis. Gains or losses arising from derecognition of an intangible
asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are
recognised in the Statement of Comprehensive Income when the asset is derecognised.
(i) Research and development costs
Development expenditure on an individual project is recognised as an intangible asset when the Company can demonstrate:
•
•
The technical feasibility of completing the intangible asset so that the asset will be available for use or sale
Its intention to complete and its ability to use or sell the asset
46 Actinogen Medical Limited
• How the asset will generate future economic benefits
•
•
•
The availability of resources to complete the asset
The ability to measure reliably the expenditure during development
The ability to use the intangible asset generated
Following initial recognition of the development expenditure as an asset, the asset is carried at cost less any accumulated
amortisation and accumulated impairment losses. Amortisation of the asset begins when development is complete, and the
asset is available for use. It is amortised over the period of expected future benefit. During the period of development, the
asset is tested for impairment annually.
The Company assessed whether the above criteria had been met for the financial year ended 30 June 2021. The Company did
not meet this criterion and as a consequence all research and development costs were expensed to profit and loss for the
current year.
(ii)
Intellectual property
The Company’s intangible assets relate to intellectual property for upfront payments to purchase patents and licenses. The
patents and licenses have been granted for a period of 20 years by the relevant government agency with the option of renewal
at the end of this period. As a result, those patents and licenses are amortised on a straight-line basis over the period of the
patent patents and license. The remaining life of the patents and licenses is 10 years. Refer to Note 12: Intangible Assets.
(j) Government grants
Research and development tax rebates are treated as a government grant. Government grants are recognised as income
where there is reasonable assurance that the grant will be received, and all attached conditions will be complied with. When
the grant relates to an expense item, it is recognised as income on a systematic basis over the periods that the costs, which it
is intended to compensate, are expensed.
(k)
Income tax
The charge for current income tax expense is based on the result for the year adjusted for any non-assessable or disallowed
items. It is calculated using the tax rates that have been enacted or are substantially enacted by the end of the reporting
period.
Deferred income tax is accounted for using the liability method on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the financial statements. However, the deferred income tax from the initial
recognition of an asset or liability, in a transaction other than a business combination is not accounted for if it arises that at the
time of the transaction and affects neither accounting or taxable profit or loss.
Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of
the reporting period and are expected to apply when the asset is realised, or liability is settled. Deferred tax assets are
recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be
available to utilise those temporary differences and losses.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities
and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where
the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle
the liability simultaneously.
Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised in other
comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in
equity, respectively.
(l) Employee benefits
Provision is made for the Company’s liability for employee benefits arising from services rendered by employees to balance
date. Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be
paid when the liability is settled, plus related on-costs. Employee benefits payable later than one year have been measured
using the projected unit credit valuation method to estimate future cash outflows to be made for those benefits discounted
using the interest rate on high quality corporate bonds with terms to maturity approximating the terms of the liability.
(m) Share-based payments
The Company provides benefits to employees (including Directors) and consultants of the Company in the form of share-based
payment transactions, whereby employees and consultants render services in exchange for shares or rights over shares
(‘equity-settled transactions’). The cost of these equity-settled transactions with employees is measured by reference to the
fair value at the date at which they are granted. The fair value is determined by an internal valuation using a Black-Scholes
option pricing model.
Annual Financial Report 47
Notes to the Financial Statements
(continued)
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in
which the performance conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to
the award (‘vesting date’).
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects (i) the
extent to which the vesting period has expired and (ii) the number of awards that, in the opinion of the Directors of the
Company, will ultimately vest. This opinion is formed based on the best available information at balance date. No adjustment is
made for the likelihood of market performance conditions being met as the effect of these conditions is included in the
determination of fair value at grant date.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is only conditional upon a
market condition. Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and
any expense not yet recognised for the award is recognised immediately. However, if a new award is substituted for the
cancelled award and designated as a replacement award on the date that it is granted, the cancelled and new award are
treated as if they were a modification of the original award.
(n) Cash and cash equivalents
For the purpose of the Statement of Cash Flows, cash and cash equivalents includes cash on hand, deposits held at call with
financial institutions, bank overdrafts and other short term, highly liquid investments with original maturities of three months or
less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.
(o) Interest income:
Interest income is recorded using the effective interest rate method (EIR). EIR is the rate that exactly discounts the estimated
future cash payments or receipts over the expected life of the financial instrument, or a shorter period, where appropriate, to
the net carrying amount of the financial asset or liability. Interest income is included in finance income in the Statement of
Comprehensive Income.
(p) Goods and services tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not
recoverable from the ATO. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as
part of the expense. Receivables and payables in the Statement of Financial Position are shown inclusive of GST. Cash flows
are presented in the Statement of Cash Flows on a gross basis, except for the GST component of investing and financing
activities, which are disclosed as operating cash flows.
(q) Contributed equity
Ordinary issued share capital is recognised at the fair value of the consideration received by the Company. Any transaction
costs arising on the issue of ordinary shares are recognised directly in equity as a reduction in share proceeds received.
(r) Trade and other payables
Liabilities for trade creditors and other amounts are subsequently carried at amortised cost after initial recognition at fair value.
Interest, when charged by the lender, is recognised as an expense on an accrual basis.
(s) Provisions
Provisions for legal claims and make good obligations are recognised when the Company has a present legal or constructive
obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation and the
amount has been reliably estimated. Provisions are not recognised for future operating losses.
Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by
considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to
any one item included in the same class of obligations may be small.
Provisions are measured at the present value of management’s best estimate of the expenditure required to settle the present
obligation at the reporting date. The discount rate used to determine the present value reflects current market assessments of
the time value of money and the risks specific to the liability. The increase in the provision due to the passage of time is
recognised as interest expense.
48 Actinogen Medical Limited
(t) Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the result attributable to owners of the Company, excluding any costs of
servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the
financial year, adjusted for bonus elements in ordinary shares issued during the year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the
after-income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the
weighted average number of additional ordinary shares that would have been outstanding assuming the conversion of all
dilutive potential ordinary shares.
(u) Financial assets
Receivables are recognised initially at fair value and subsequently measured at amortised cost using the effect interest
method, less allowance for impairment. The Company recognises an allowance for expected credit losses (ECLs) for financial
assets not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in
accordance with the contract and all the cash flows that the Company expects to receive, discounted at an approximation of
the original effective interest rate. Trade receivables are generally due for settlement within 30 days.
While the Company has policies in place to ensure that transactions with third parties have an appropriate credit history, the
management of current and potential credit risk exposures is limited as far as is considered commercially appropriate. Up to
the date of this Report, the Board has placed no requirement for collateral on existing debtors.
(v) Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision
maker. The chief operating decision maker, who is responsible for allocating resources and assessing performance of the
operating segments, has been identified as the Board of Directors.
(w) Leases
Right-of-use asset:
The Company recognises a right-of-use asset at the commencement date of the lease (i.e., the date the underlying asset is
available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and
adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities
recognised, initial direct costs incurred, and lease payments made at or before the commencement date less any lease
incentives received. Unless the Company is reasonably certain to obtain ownership of the leased asset at the end of the lease
term, the recognised assets are depreciated on a straight-line basis over the shorter of its estimated useful life and the lease
term. A right-of-use asset is subject to impairment.
Lease liabilities:
At the commencement date of the lease, the Company recognises lease liabilities measured at the present value of lease
payments to be made over the lease term. The lease payments include fixed payments (including in-substance fixed
payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts
expected to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase option
reasonably certain to be exercised by the Company and payments of penalties for terminating a lease, if the lease term reflects
the Company exercising the option to terminate. The variable lease payments that do not depend on an index or a rate are
recognised as expense in the period on which the event or condition that triggers the payment occurs.
In calculating the present value of lease payments, the Company uses the incremental borrowing rate at the lease
commencement date if the interest rate implicit in the lease is not readily determinable. After the commencement date, the
amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In addition,
the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the in-
substance fixed lease payments or a change in the assessment to purchase the underlying asset.
Short-term leases and leases of low-value assets:
The Company applies the short-term lease recognition exemption to its short-term leases (i.e., those leases that have a lease
term of 12 months or less from the commencement date and do not contain a purchase option). It also applies the lease of low-
value assets recognition exemption to leases of office equipment that are considered of low value (i.e., below USD$5,000).
Lease payments on short-term leases and leases of low-value assets are expensed on a straight-line basis over the lease term.
Annual Financial Report 49
Notes to the Financial Statements
(continued)
(x) New accounting standards and interpretations not yet adopted
Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2021 reporting
periods and have not been early adopted by the Company. These new standards and interpretations, and the status of the
Company’s assessment of impact on the Company, are set out below.
Application
date of
standard
Application
date for
Company
1 January 2023
1 July 2023
1 January 2023
1 July 2023
1 January 2023
1 July 2023
Reference
Title
Summary
AASB 2020-1 Amendments to
AASs –
Classification of
Liabilities as
Current or Non-
current
AASB 2021-2 Amendments to
AASB 108 –
Definition of
Accounting
Estimates
AASB 2021-
28
Amendments to
AASB 7, AASB 101,
AASB 134 Interim
Financial
Reporting and
AASB Practice
Statement 2
Making Materiality
Judgements–
Disclosure of
Accounting
Policies
A liability is classified as current if the entity has no
right at the end of the reporting period to defer
settlement for at least 12 months after the reporting
period. The AASB recently issued amendments to
AASB 101 Presentation of Financial Statements to
clarify the requirements for classifying liabilities as
current or non-current.
The amendments to AASB 108 clarify the definition of
an accounting estimate, making it easier to
differentiate it from an accounting policy. The
distinction is necessary as their treatment and
disclosure requirements are different. Critically, a
change in an accounting estimate is applied
prospectively whereas a change in an accounting
policy is generally applied retrospectively. The new
definition provides that ‘Accounting estimates are
monetary amounts in financial statements that are
subject to measurement uncertainty.’ The
amendments explain that a change in an input or a
measurement technique used to develop an
accounting estimate is considered a change in an
accounting estimate unless it is correcting a prior
period error.
The amendments to AASB 101 require disclosure of
material accounting policy information, instead of
significant accounting policies. Unlike ‘material10’,
‘significant’ was not defined in Australian Accounting
Standards. Leveraging the existing definition of
material with additional guidance is expected to help
preparers make more effective accounting policy
disclosures. The guidance illustrates circumstances
where an entity is likely to consider accounting policy
information to be material. Entity-specific accounting
policy information is emphasised as being more
useful than generic information or summaries of the
requirements of Australian Accounting Standards.
The amendments to AASB Practice Statement 2
supplement the amendments to AASB 101 by
illustrating how the four-step materiality process can
identify material accounting policy information.
The Company has not early adopted any other accounting standard, interpretation or amendment that has been issued but is
not yet effective. The adoption of these standards, interpretations or amendments is not expected to have a material impact
on the financial position or performance of the Company.
(y) New accounting standards and interpretations issued but not yet effective
Since 1 July 2020, Actinogen Medical has adopted all Accounting Standards and Interpretations, mandatory for annual periods
beginning on or before 1 July 2020. The adoption of the new and amended accounting standards and interpretations had no
impact on the Company.
50 Actinogen Medical Limited
3. SEGMENT INFORMATION
The Company’s sole operations are within the biotechnology industry within Australia. Given the nature of the Company, its
size and current operations, the Company’s management does not treat any part of the Company as a separate operating
segment. Internal financial information used by the Company’s decision makers is presented on a “whole of entity” manner
without dissemination to any separately identifiable segments. Accordingly, the financial information reported elsewhere in this
financial report is representative of the nature and financial effects of the business activities in which it engages and the
economic environments in which it operates. All non-current assets are held in Australia and all income is derived in Australia.
4. FINANCIAL RISK MANAGEMENT
The Company’s principal financial liabilities comprise trade, other payables and lease liabilities. The Company’s principal
financial assets include trade receivables, and cash and short-term deposits.
The Company is exposed to market risk, credit risk and liquidity risk. The Company’s Board and senior management oversees
the management of these risks however, the Company’s overall risk in these areas is not significant enough to warrant a
formalised specific risk management program. Risk management is carried out in their day-to-day functions as the overseers
of the business.
Set out below is an overview of the financial instruments held by the Company as at 30 June 2021:
As at 30/06/2021
Financial assets:
Cash and cash equivalents
Trade and other receivables
Total current assets
Total financial assets
Financial liabilities:
Trade and other payables
Lease liabilities - current
Total current liabilities
Cash and cash
equivalents
$
Financial assets / liabilities at
amortised cost
$
13,421,653
-
-
89,956
13,421,653
89,956
13,421,653
89,956
-
619,573
-
71,170
-
690,743
Lease liabilities - non-current
-
165,271
Total non-current liabilities
Total financial liabilities
-
165,271
-
856,014
Net exposure
13,421,653
(766,058)
Annual Financial Report 51
Notes to the Financial Statements
(continued)
4. FINANCIAL RISK MANAGEMENT (CONTINUED)
Set out below is an overview of the financial instruments held by the Company as at 30 June 2020:
As at 30/06/2020
Financial assets:
Cash and cash equivalents
Trade and other receivables
Total current assets
Total financial assets
Financial liabilities:
Trade and other payables
Lease liabilities - current
Total current liabilities
Cash and cash
equivalents
$
Financial assets / liabilities at
amortised cost
$
5,040,486
-
-
467,192
5,040,486
467,192
5,040,486
467,192
-
509,275
-
86,018
-
595,293
Lease liabilities - non-current
-
303,852
Total non-current liabilities
Total financial liabilities
-
303,852
-
899,145
Net exposure
(a)
Market Risk
(i) Interest rate risk
5,040,486
(431,953)
Interest rate risk is the risk of loss to the Company arising from adverse changes in interest rates. The Company has no interest-
bearing debt and is only exposed to interest rate risk in respect of amounts held in current, interest-bearing bank accounts and
demand deposits. At 30 June 2021, the Company held $13,265,921 (2020: $4,967,363) in such accounts and deposits.
A 1% decrease is used when reporting interest rate risk internally to key management personnel and represents management’s
assessment of the reasonable and possible change in interest rates. For each interest rate movement of 1% lower, assuming all
other variables were held constant, the Company’s loss would increase by $132,659 (2020: $49,674).
Sensitivity analysis:
30 June 2021
Financial Assets
Interest rate risk
-1%
+1%
Carrying amount
Profit/Equity
Profit/Equity
$
$
$
Cash and cash equivalents
13,265,921
(132,659)
132,659
30 June 2020
Financial Assets
Cash and cash equivalents
4,967,363
(49,674)
49,674
52 Actinogen Medical Limited
Variable rate instruments:
As at 30/6/2021
As at 30/6/2020
Weighted average
interest rate
Balance
Weighted average
interest rate
Balance
%
$
%
$
Cash and cash equivalents
0.21
13,265,921
0.75
4,967,363
(b)
Credit risk
Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash
equivalents and receivables. The maximum credit risk is the face value of these financial instruments. However, the Company
considers the risk of non-recovery of these accounts to be minimal. The Company trades only with recognised, creditworthy
third parties and as such collateral is not requested nor is it the Company’s policy to securitise its trade and other receivables.
Receivable balances are monitored on an ongoing basis with the result that the Company does not have a significant exposure
to bad debts. The Company has the following concentrations of credit risk:
(i) Cash
Credit risk from balances with banks and financial institutions is managed by the Company’s finance department. Investments
of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty. The
Directors believe that there is negligible credit risk with the Company’s cash and cash equivalents, as funds are held at call
with National Australia Bank, a reputable Australian Banking institution.
(ii) Trade and other receivables
While the Company has policies in place to ensure that transactions with third parties have an appropriate credit history, the
management of current and potential credit risk exposures is limited as far as is considered commercially appropriate. Up to
the date of this Report, the Board has placed no requirement for collateral on existing debtors.
(c)
Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial liabilities as and when they fall due. Prudent
liquidity risk management implies maintaining sufficient cash and marketable securities, the availability of funding through an
adequate amount of committed credit facilities and the ability to close out market positions. The Company manages liquidity
risk by continuously monitoring forecast and actual cash flows. Surplus funds are generally only invested at call or in bank bills
that are highly liquid and with maturities of less than six months.
(i) Financing arrangements
The Company does not have any financing arrangements (2020: None).
(ii) Maturities of financial liabilities
The Company’s debt relates to trade and other payables, where payments are generally due within 30 days, and lease
liabilities.
The table below summarises the maturity profile of the Company’s financial liabilities based on contractual undiscounted
payments:
On
demand
Less than
3 months
3 to 12
months
1 to 5
months
$
$
$
$
Total
$
As at 30 June 2021
Trade and other payables
-
619,573
-
-
619,573
Lease liabilities
Total
As at 30 June 2020
6,798
13,596
61,454
166,012
247,861
6,798
633,169
61,454
166,012
867,434
Trade and other payables
-
509,275
-
-
509,275
Lease liabilities
Total
8,669
17,338
78,368
328,708
433,083
8,669
526,613
78,368
328,708
942,358
Annual Financial Report 53
Notes to the Financial Statements
(continued)
4. FINANCIAL RISK MANAGEMENT (CONTINUED)
(d)
Fair Value Measurements
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for disclosure
purposes. Accounting standards require disclosure of fair value measurements by level of the following fair value measurement
hierarchy:
(a) quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1).
(b)
inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (as
prices) or indirectly (derived from prices) (level 2).
(c)
inputs for the asset or liability that are not based on observable market data (unobservable inputs) (level 3).
The carrying value of financial assets and financial liabilities, excluding lease liabilities, approximates their fair value as at 30
June 2021 and 30 June 2020 given the nature of the financial assets and liabilities.
As at 30 June 2021
Financial liabilities
Lease liabilities
Level 1
$
Level 2
$
Level 3
$
Total
$
-
236,441
-
236,441
Total financial liabilities
-
236,441
-
236,441
As at 30 June 2020
Financial liabilities
Lease liabilities
-
389,870
-
389,870
Total financial liabilities
-
389,870
-
389,870
5. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
•
Key estimates: Share-based payments
The Company initially measures the cost of equity-settled transactions with employees by reference to the fair value of the
equity instruments at the date at which they are granted. Estimating fair value for share-based payment transactions requires
determination of the most appropriate valuation model, which is dependent on the terms and conditions of the grant. This
estimate also requires determination of the most appropriate inputs to the valuation model including the expected life of the
share option, volatility and dividend yield and making assumptions about them. The assumptions and models used for
estimating fair value for share-based payment transactions are disclosed in Note 21.
•
Key estimates: Impairment of intangible assets
The Company assesses impairment for intangible assets at each reporting date or when an impairment indicator exists, by
evaluating conditions specific to the Company and to the particular asset that may lead to impairment. These include product,
technology, economic and political environments and future expectations. If an impairment indicator exists, the recoverable
amount of the asset is determined. For further information on intangible assets refer to Note 2(i).
•
Significant judgement: Research and development tax rebate
In line with accounting policy 2(j) research and development tax rebates are treated as government grants and are recognised
as income where there is reasonable assurance that the grant will be received, and all attached conditions will be complied
with. The Company applies judgment in assessing that all attached conditions will be complied with based on the nature of the
expenditure incurred and the activities of the Company undertaken during the year.
54 Actinogen Medical Limited
5. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (CONTINUED)
•
Significant judgement in determining the lease term of contracts with renewal options:
The Company determines the lease term as the non-cancellable term of the lease, together with any periods covered by an
option to extend the lease if it is reasonably certain to be exercised, or any periods covered by an option to terminate the
lease, if it is reasonably certain not to be exercised. The Company has the option under some of its leases to lease the assets
for additional terms. The Company applies judgement in evaluating whether it is reasonably certain to exercise the option to
renew. That is, it considers all relevant factors that create an economic incentive for it to exercise the renewal. After the
commencement date, the Company reassesses the lease term if there is a significant event or change in circumstances that is
within its control and affects its ability to exercise (or not to exercise) the option to renew and renewal periods (e.g. a change
in business strategy).
6. OTHER INCOME AND EXPENSES
Income
Interest income
Other income:
Government grants
R&D tax rebate (current year)
Full year ended
30/06/2021
Full year ended
30/06/2020
$
$
27,090
94,057
144,656
201,272
1,438,571
3,315,125
R&D tax rebate (prior year deferred income)
400,845
-
Total other income
Total income
Expenses
Research and development costs:
Research consultants
Administrative
Laboratory expenses
1,984,072
3,516,397
2,011,162
3,610,454
421,561
249,948
273,534
398,849
1,711,142
4,888,373
Total research and development costs
2,406,237
5,537,170
Annual Financial Report 55
Notes to the Financial Statements
(continued)
7.
INCOME TAX
Full year ended
30/06/2021
Full year ended
30/06/2020
$
$
Numerical reconciliation of operating loss to prima facie income
tax expense
Operating loss before income tax
(3,915,067)
(5,330,529)
Tax benefit at the Australian tax rate of 26% (2020: 27.5%)
(1,017,917)
(1,465,895)
Tax effect of amounts that are not deductible / taxable in
calculating taxable income:
- Non-deductible expenses
- ATO interest income
- ATO cash flow boost
- Share-based payments
- Research and development
- Deferred income tax asset not brought to account
1,598
940
-
327
13,000
-
75,213
53,484
485,807
442,299
912,167
498,977
Income tax expense
-
-
Tax Losses
Unused tax losses for which no deferred tax asset has been
recognised
Potential tax benefit @ 26% (2020: 27.5%)
Unrecognised temporary differences
Temporary differences for which deferred tax assets have not
been recognised:
- Provisions and accruals
- Intangible assets
- Capital raising costs
- Patent application fees
- Legal expenses
- Fixed assets
15,692,749
4,080,115
13,913,174
3,826,123
4,080,115
3,826,123
125,325
180,663
1,103,249
790,502
889,017
534,436
25,990
66,414
19,202
3,800
(16,509)
(18,542)
2,146,274
1,557,273
Unrecognised deferred tax asset relating to the above temporary
differences @ 26% (2020: 27.5%)
558,031
428,250
The tax benefit of tax losses and other deductible temporary differences will only arise in the future where the Company
derives sufficient net taxable income and is able to satisfy the carried forward tax loss recoupment rules. The Directors believe
that the likelihood of the Company achieving sufficient taxable income in the future is currently not probable and the tax
benefit of these tax losses and other temporary differences have not been recognised.
56 Actinogen Medical Limited
8. CASH AND CASH EQUIVALENTS
Cash at bank and on hand
Short term deposits
Total cash and cash equivalents
As at
30/06/2021
As at
30/06/2020
$
$
6,356,653
7,065,000
1,475,485
3,565,001
13,421,653
5,040,486
During the year ended 30 June 2021, the Company received interest revenue through holding several interest-bearing term
deposit accounts between 30 and 90 day terms. The Company also received cash in the form of government grants due to an
export and development grant and economic COVID-relief. The main contributor to an increase in cash came from the
Company receiving cash proceeds from issued equity (net of capital raising costs) totalling $10,195,361. The Company is also
expecting to receive a research and development tax incentive estimated at $1,438,571 for eligible expenditure incurred during
the year ended 30 June 2021. This has been recognised as receivable at year end. Refer to Note 9.
Reconciliation of net cash flows from operating activities
Loss for the year
Non-cash items:
Depreciation (computer equipment)
Depreciation (lease: office rental)
Amortisation expense
Share-based payment expense
Change in assets and liabilities:
Full year ended
30/06/2021
Full year ended
30/06/2020
$
$
(3,915,067)
(5,330,529)
8,220
4,219
65,728
95,112
312,747
313,602
289,282
194,488
(Increase)/decrease in trade and other receivables
1,489,106
1,767,093
Decrease in trade and other payables
110,298
75,700
(Decrease)/increase in provisions
(84,216)
24,702
(1,723,902)
(2,855,613)
Non-cash financing and investing activities:
During the year, the Company issued 48,362,300 ordinary shares to Dr Gourlay by way of provision of a limited recourse loan
as part of his employment with the Company on 15 March 2021. The total subscription price of these shares is $1,934,492,
which equates to the “Loan Amount”. However, given that these shares are considered to be “in-substance options” or “rights”
under Generally Accepted Accounting Principles, no loan amount is recognised in the financial statements. Refer to section
3(C)(iii) of the Remuneration Report for further information. There were no other non-cash financing and investing activities that
occurred during the year ended 30 June 2021.
Financing facilities available:
As at 30 June 2021, the Company had no financing facilities available (2020: None). For the purposes of the Statement of Cash
Flows, cash includes cash on hand and in banks and investments in money market instruments, net of outstanding bank
overdrafts.
Interest rate risk exposure:
The Company’s exposure to interest rate risk is discussed in Note 4.
Credit risk exposure:
The maximum exposure to credit risk at the end of the reporting period is the carrying amount of each class of cash and cash
equivalents mentioned above.
Annual Financial Report 57
Notes to the Financial Statements
(continued)
9. OTHER RECEIVABLES
Prepaid insurance
Prepaid consumables
Goods and services tax receivable
As at
30/06/2021
As at
30/06/2020
$
89,956
-
105,795
$
60,175
400,845
173,537
Research and development tax rebate receivable
1,438,571
2,482,699
Other receivable
Total other receivables
-
6,172
1,634,322
3,123,428
None of the other receivables are impaired. Due to their short-term nature, carrying amounts approximate their fair value.
10. PROPERTY, PLANT AND EQUIPMENT
As at
30/06/2021
As at
30/06/2020
$
$
At cost
28,947
22,760
Accumulated depreciation
(12,438)
(4,219)
Total property, plant and equipment
16,509
18,541
Movements during the year:
Computer Equipment
$
Total
$
Opening balance at 1 July 2019
-
-
Acquisitions
Depreciation
22,760
22,760
(4,219)
(4,219)
Closing balance at 30 June 2020
18,541
18,541
Opening balance at 1 July 2020
18,541
18,541
Acquisitions
Depreciation
6,188
6,188
(8,220)
(8,220)
Closing balance at 30 June 2021
16,509
16,509
58 Actinogen Medical Limited
11. RIGHT-OF-USE ASSET & LEASE LIABILITY
Set out below are the amounts recognised in the statement of comprehensive loss for the year ended 30 June 2021:
As at
30/06/2021
As at
30/06/2020
$
$
Depreciation expense on right-of-use asset
93,937
95,112
Interest expense on lease liabilities
Rent expense - short-term leases
18,054
22,618
1,560
1,560
Total amounts recognised in profit or loss
113,551
119,290
Set out below are the carrying amounts of the Company’s assets and lease liabilities recognised in the statement of financial
position and the movements during the year ended 30 June 2021:
Right-of-use Assets
Property
$
Lease
Liability
$
As at 1 July 2020
372,501
389,870
Adjustment to Right-of-use asset due to revised lease terms
(69,325)
(69,325)
Depreciation expense (a)
(93,937)
-
Adjustment to depreciation expense due to revised lease terms (a)
28,209
-
Interest expense (b)
Payments (b)
As at 30 June 2021 (c)
As at 1 July 2019
Initial adoption of AASB 16
Depreciation expense
Interest expense
Payments
As at 30 June 2020
-
18,054
-
(102,158)
237,448
236,441
-
-
467,613
467,613
(95,112)
-
-
22,618
-
(100,361)
372,501
389,870
(a) The depreciation expense shown on the statement of comprehensive income totals $65,728. This amount comprises the
depreciation expense charged during the financial year amounting to ($93,937) plus an adjustment of $28,209 which
recognises the new terms that took effect from 1 June 2021.
(b) The lease payments made during the year totalled $102,158 comprising $84,104 which represents the principal
component and $18,054 which represents the interest expense component.
(c) Of the total lease liability amounting to $236,441, $71,170 is current, and $165,271 is non-current.
Annual Financial Report 59
Notes to the Financial Statements
(continued)
12. INTANGIBLE ASSETS
At cost
5,756,743
5,756,743
Accumulated amortisation and impairment loss
(2,723,539)
(2,410,792)
Total intangible assets
3,033,204
3,345,951
As at
30/06/2021
As at
30/06/2020
$
$
Movements during the year:
Opening balance at 1/7/2020
Amortisation expense
Closing balance at 30/6/2021
Opening balance at 1/7/2019
Amortisation expense
Closing balance at 30/6/2020
Intellectual property
Intellectual
Property
$
3,345,951
(312,747)
3,033,204
3,659,553
(313,602)
3,345,951
On 8 December 2014, Actinogen Medical entered into an Assignment of Licence Agreement with Corticrine Limited for the
assignment of all of Corticrine’s interest in, to and under the Licence Agreement to Actinogen Medical and the assumption by
the Company of all of Corticrine's obligations in respect of such Assignment. When the Company acquired the intellectual
property from Corticrine, this comprised patents and licences, as well as the value of research performed to date, and the
progression of testing to human trials. The intellectual property is supported by several patent families, the most recent of
which will expire in 2031. The patent useful life has been aligned to the patent term and as a result, those patents are
amortised on a straight-line basis over the period of the patent. The remaining life of the patents and licenses is 10 years.
As at 30 June 2021, the Company assessed whether any indicators of impairment reversal were present that suggested that
the impairment loss charged in a prior year may require full or partial reversal. The Company determined that an impairment
reversal indicator was present, however after assessing various internal and external indicators, the Company determined that
no impairment reversal was necessary in the current year.
Subsequent patent applications (not included in Intangible Assets)
Actinogen continues to proactively extend its IP portfolio. However, the above amount for Intangible Assets does not include
subsequent patent applications. During the year Actinogen filed two new patent applications for its lead drug, Xanamem, to
seek to extend its patent life protection until 2040.
•
•
The first application to provide patent protection to a method of treating cognitive decline.
The second application provides patent protection to a commercial scale-up manufacturing process for Xanamem.
60 Actinogen Medical Limited
13. TRADE AND OTHER PAYABLES
Trade payables
Accruals and other payables
Deferred income (a)
Goods and services tax payable
Provision for payroll tax
Employee liabilities
As at
30/06/2021
As at
30/06/2020
$
392,187
54,903
$
46,841
27,000
-
400,845
1,116
-
10,620
-
160,747
34,589
Total trade and other payables (b)
619,573
509,275
(a)
(b)
In the prior year ended 30 June 2020, $400,845 was recognised as deferred income. Since then, the $400,845 was
reversed during the financial year ended 30 June 2021 and recognised as income due to the physical supply of drugs
by a supplier of the Company.
Trade and other payables are non-interest-bearing liabilities stated at amortised cost and settled within 30 days.
14. CONTRIBUTED EQUITY
(a)
Fully paid ordinary shares
Fully paid ordinary shares
Capital raising costs
Total contributed equity
As at
30/06/2021
As at
30/06/2020
$
$
64,163,878
51,318,157
(4,109,419)
(3,393,551)
60,054,459
47,924,606
As at 30 June 2021 there were 1,660,558,547 ordinary shares of issue. Ordinary shares entitle the holder to participate in
dividends and the winding up of the Company in proportion to the number and amount paid on the share held. Of the
1,660,558,547 ordinary shares on issue, 48,362,300 shares were issued to Dr Gourlay as remuneration upon commencement
of employment on 15 March 2021. Although they are issued ordinary shares that carry voting and divided rights they have
been accounted for as “in-substance options”. Refer to the Directors’ Report, specifically section 3(C)(b)(iii) of the
Remuneration Report for further information on these loan shares.
Movement of fully paid ordinary shares during the year were as follows:
Date
Quantity
Unit Price $
Total $
Opening balance at 1 July 2019
1,119,231,320
Less cancelled unvested loan shares
31/01/2020
(3,000,000)
Balance at 30 June 2020
1,116,231,320
48,044,606
(120,000)
47,924,606
Proceeds from Placement
22/10/2020
272,727,273
$ 0.022
6,000,000
Proceeds from Rights Issue
17/11/2020
61,828,576
$ 0.022
1,360,229
Proceeds from Shortfall Placement
10/02/2021
161,409,078
$ 0.022
3,551,000
Capital raising costs
Loan Shares
Loan Shares
15/03/2021
15/03/2021
24,181,150
$ 0.035
846,340
24,181,150
$ 0.045
1,088,152
(715,868)
Balance at 30 June 2021
1,660,558,547
60,054,459
Annual Financial Report 61
Notes to the Financial Statements
(continued)
14. CONTRIBUTED EQUITY (CONTINUED)
(b) Reserve shares
Reserves shares (“Loan shares”) are ordinary shares that have historically been accounted for as “in-substance options”. No
loan amount is recognised in the financial statements. As at 30 June 2021, the following reserve shares were on issue.
Reserve shares
Date
Quantity
Unit Price $
Total $
Reserve shares (loan shares)
15/03/2021
(24,181,150)
$ 0.035
(846,340)
Reserve shares (loan shares)
15/03/2021
(24,181,150)
$ 0.045
(1,088,152)
Balance at 30 June 2021
(48,362,300)
(1,934,492)
Refer to the Directors’ Report, specifically section 3(C)(b)(iii) of the Remuneration Report for information on these loan shares.
(c) Unissued ordinary shares under option
Quantity
Type of Option
Grant Date
Exercise Price
Expiry Date
5,783,333
Employee Options
12/12/2018
$ 0.085
12/12/2023
1,600,000
Employee Options
28/09/2020
$ 0.046
27/09/2025
5,000,000
Director Options
24/03/2017
$ 0.100
24/03/2025
1,500,000
Director Options
15,175,000
Director Options
3,000,000
Director Options
5,000,000
Employee Options
18/01/2018
28/11/2018
4/04/2019
1/02/2019
$ 0.100
1/12/2022
$ 0.085
27/11/2023
$ 0.100
4/04/2024
$ 0.093
1/02/2024
37,058,333
Total unissued ordinary shares under option
During the year, and up to the date of this Report, the following options were expired, lapsed or forfeited:
•
•
5 February 2021 – 3,559,298 options issued to employees of the Company at $0.10 per option expired on 5 February
2021.
8 May 2021 – 2,925,000 options issued to Dr Bill Ketelbey at $0.085 per option, expiring on 27 November 2023,
lapsed as vesting conditions weren’t met due to forfeiture associated with cessation of employment on 8 February
2021.
No option holder has any right, by virtue of the option, to participate in any share issue of the Company or any related body
corporate.
(d) Terms and Conditions of Issued Capital
At shareholders’ meetings each ordinary share is entitled to one vote when a poll is called, otherwise each shareholder has a
vote on a show of hands. Ordinary shares have no par value.
(e) Capital risk management
The Company’s objectives when managing capital are to safeguard its ability to continue as a going concern, so it can provide
returns to shareholders and benefits to other stakeholders. The Company considers capital to consist of cash reserves on
hand.
Consistent with the Company’s objective, it manages working capital by issuing new shares, investing in and selling assets,
submitting applications for research and development rebates to the Australian Tax Office or modifying its planned research
and development program as required.
Given the stage of the Company’s development there are no formal targets set for return on capital. The Company is not
subject to externally imposed capital requirements. The net equity of the Company is equivalent to capital. Net capital is
obtained through capital raisings on the ASX and receipt of Research and Development rebates from the Australian Tax Office.
62 Actinogen Medical Limited
15. RESERVES
Reserves are made up of the option reserve. The option reserve records items recognised as share-based payment (SBP)
expenses for employee and Director options. Details of the movement in reserves is shown below.
Option reserve
Total reserves
Movements in Option reserve during the year were as follows:
As at
30/06/2021
As at
30/06/2020
$
$
7,780,027
7,490,745
7,780,027
7,490,745
As at
30/06/2021
As at
30/06/2020
$
$
Option reserve
Balance at the beginning of the period
7,490,745
7,296,257
Share-based payment expense on Director options
86,685
127,419
Share-based payment expense on Employee options
59,688
67,069
Share-based payment expense on Loan shares
142,909
-
Balance at end of period
7,780,027
7,490,745
Total share-based payment expenses recognised during the year amounted to $289,282. For further information on share-
based payments refer to Note 21. For further information on loan shares and unissued ordinary shares under option refer to
Note 14.
16. LOSSES PER SHARE
Full year ended
30/06/2021
Full year ended
30/06/2020
$
$
Basic and diluted loss per share from continuing operations attributable to the
ordinary shareholders of the Company (cents)
(0.28)
(0.48)
Weighted number of ordinary shares used as the denominator
1,405,160,665
1,117,982,005
Net loss used in calculating loss per share
(3,915,067)
(5,330,529)
As at 30 June 2021, there were 37,058,333 (2020: 41,942,631) unissued ordinary shares under option and 48,362,300 loan
shares (2020: Nil) excluded from the calculation of diluted earnings per share that could potentially dilute basic earnings per
share in the future but are anti-dilutive for the current period presented. There have been no other transactions involving
ordinary shares or potential ordinary shares between the reporting date and the date of authorization of these financial
statements.
17. COMMITMENTS AND CONTINGENCIES
Other than what is mentioned below, the Directors are not aware of any commitments, contingent liabilities or assets that exist
at 30 June 2021 (2020: Nil):
(a) Final amount due to Corden Pharma of CHF443,520 (approximately A$650,000) for the manufacture of Xanamem drug
substance;
(b) Clinical trial contracts with Avance Clinical and Paratus Clinical totalling approximately $2,100,000; and
(c) Cogstate for the provision of online clinical endpoint software of approximately $410,000.
Annual Financial Report 63
Notes to the Financial Statements
(continued)
18. REMUNERATION OF AUDITOR
Full year ended
30/06/2021
Full year ended
30/06/2020
$
$
Amounts paid or payable to Ernst & Young for:
An audit or review of the financial statements of the entity
43,265
40,800
Other assurance services
-
2,600
43,265
43,400
19. RELATED PARTY TRANSACTIONS
There were no related party transactions that occurred during the year other than transactions with KMP as set out in Note 20.
20. KEY MANAGEMENT PERSONNEL DISCLOSURES
Key Management Personnel (KMP) of the Company and their compensation during the year are listed below:
Current /
Resigned
Current
Current
Current
Current
Current
Current
Name
Position
Dr Geoffrey Brooke
Non-Executive Chairman
Dr Steven Gourlay
Managing Director / Chief Executive Officer
Dr George Morstyn
Non-Executive Director
Mr Malcolm McComas
Non-Executive Director
Ms Tamara Miller
Vice President of Drug Development & Strategy
Mr Jeff Carter
Dr Bill Ketelbey
Short-term employee benefits
Termination benefits
Post-employment benefits
Long-term benefits
Share-based payments
Chief Financial Officer
Managing Director / Chief Executive Officer
8/02/2021
Full year ended
30/06/2021
Full year ended
30/06/2020
$
$
982,540 590,894
238,014
-
56,820
33,095
46,743
26,660
258,263
127,420
1,582,380
778,069
The detailed remuneration disclosures and relevant interest of each KMP in fully paid ordinary shares and options of the Company
are provided in the audited Remuneration Report on pages 22 to 37.
Termination benefits paid out during the year ended 30 June 2021 were to Bill Ketelbey due to his resignation on 8 February 2021.
This is detailed in Section 4 of the Remuneration Report.
64 Actinogen Medical Limited
21. SHARE-BASED PAYMENTS
The table below summarises the assumptions used in valuing share-based payments in prior periods and the current financial year; and movements in share-based payments during the year. The table shows
options on issue, including loan shares that are in substance options, as at 30 June 2021.
Grant
Date
Expiry
Date
Expected
Volatility
Risk-
free
interest
Rate
Quantity
as at
1 July 2020
Quantity
issued /
(lapsed)
during the
year
Quantity
as at
30 June
2021
Fair
value
per
option
Total
SBP
valuation
Opening value
SBP expense
as at
1 July 2020
Value
recognised
during the
year
Value
lapsed
during the
year
Closing value
of SBP
expense
as at
30 June 2021
Value to be
recognised
in future
years
Type of
share-based
payment
Options
Director options
24/03/2017 24/03/2025
100%
2.61%
5,000,000
Director options
18/01/2018
1/12/2022
60%
2.44%
1,500,000
-
-
5,000,000 $ 0.0491
$ 245,286
$ 245,286 $ -
$ -
$ 245,286
$ -
1,500,000 $ 0.0129
$ 19,350
$ 18,625
$ 725
$ -
$ 19,350
$ -
Director options
28/11/2018
27/11/2023
54%
2.29%
18,100,000
(2,925,000)
15,175,000 $ 0.0142
$ 215,485
$ 128,510
$ 71,828
$ (41,535) $ 200,338
$ 15,147
Employee options
12/12/2018
12/12/2023
54%
2.15%
5,783,333
Employee options
1/02/2019
1/02/2024
54%
1.83%
5,000,000
Director options
4/04/2019
4/04/2024
49%
1.50%
3,000,000
-
-
-
5,783,333 $ 0.0158
$ 91,377
$ 46,347 $ 30,020
$ -
$ 76,367
$ 15,010
5,000,000 $ 0.0185
$ 92,500
$ 48,364 $ 22,065
$ -
$ 70,429
$ 22,071
3,000,000 $ 0.0141
$ 42,396
$ 17,665
$ 14,132
$ -
$ 31,797
$ 10,599
Employee options
28/09/2020 28/09/2025
60%
0.32%
-
1,600,000
1,600,000 $ 0.0093 $ 14,948
$ -
$ 7,603
$ -
$ 7,603
$ 7,345
Total options
Loan shares
38,383,333
(1,325,000) 37,058,333
$ 721,342
$ 504,797
$ 146,373
$ (41,535) $ 651,170
$ 70,172
Loan shares
15/03/2021
15/03/2026
80%
0.71%
Loan shares
15/03/2021
15/03/2026
80%
0.71%
Total loan shares
-
-
-
24,181,150
24,181,150
$ 0.0145
$ 383,027
$ -
$ 74,576
$ -
$ 74,576
$ 308,451
24,181,150
24,181,150
$ 0.0145
$ 350,963
$ -
$ 68,333
$ -
$ 68,333
$ 282,630
48,362,300 48,362,300
$ 733,990
$ -
$ 142,909
$ -
$ 142,909
$ 591,080
Total share-based payment
38,383,333
47,037,300 85,420,633
$ 1,455,332
$ 504,797
$ 289,282
$ (41,535) $ 794,079
$ 661,252
Common to all classes of share-based payments on issue are the following factors and assumptions:
•
•
•
•
•
The fair value of options granted have been valued using a Black-Scholes option pricing model, taking into account the terms and conditions upon which the share options were granted. Where vesting
conditions are applicable, they are expensed over the vesting period.
The assumed dividend payable during the term of the Options is deemed to be nil.
A volatility of the share price fluctuation was calculated by considering the historical movement of the share price over a period of time as well factoring market conditions of its competitors to predict
the distribution of relative share performance.
The exercise price of the share options is equal to the market price of the underlying shares on the date of grant.
The Company does not have a past practice of cash settlement or cash settlement alternatives for these awards.
Additional information relating to Director Options, Employee Options and Loan Shares that have been issued to KMP, including any applicable vesting conditions, can be found in Section 3(C) of the
Remuneration Report.
Annual Financial Report 65
Directors’ Declaration
In the Directors’ opinion:
1. The Financial Statements and Notes set out on pages 41 to 65, are in accordance with the Corporations Act 2001
including:
(a) complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting
requirements,
(b) giving a true and fair view of the Company’s financial position as at 30 June 2021 and of its performance for the year
ended on that date,
2. The remuneration disclosure included in the audited Remuneration Report in the Directors’ Report complies with Section
300A of the Corporations Act 2001.
3. The Directors have been given the declaration by the Managing Director and Chief Financial Officer (or equivalent) as
required by section 295A of the Corporations Act 2001.
4. The Company has included in the Notes to the Financial Statements an explicit and unreserved statement of compliance
with International Financial Reporting Standards as issued by the International Accounting Standards Board.
5. There are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due
and payable.
This declaration is made in accordance with a resolution of the Directors.
Dr Steven Gourlay
Managing Director
Sydney, New South Wales
Monday, 30 August 2021
66 Actinogen Medical Limited
Independent Auditor’s Report
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Independent auditor's report to the members of Actinogen Medical
Limited
Report on the audit of the financial report
Opinion
We have audited the financial report of Actinogen Medical Limited (the Company), which comprises
the statement of financial position as at 30 June 2021, the statement of comprehensive income,
statement of changes in equity and statement of cash flows for the year then ended, notes to the
financial statements, including a summary of significant accounting policies, and the directors'
declaration of the Company.
In our opinion, the accompanying financial report of the Company is in accordance with the
Corporations Act 2001, including:
a)
b)
giving a true and fair view of the Company's financial position as at 30 June 2021 and of its
financial performance for the year ended on that date
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Report section of our report. We are independent of the Company in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the
Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional
Accountants (including Independence Standards) (the Code) that are relevant to our audit of the
financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with
the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial report of the current year. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, but we do not provide
a separate opinion on these matters. For each matter below, our description of how our audit
addressed the matter is provided in that context. We have determined the matters described below to
be the key audit matters to be communicated in our report.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
PD:ET:ACTINOGEN:007
67
Annual Financial Report
Independent Auditor’s Report (continued)
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the
financial report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of
material misstatement of the financial report. The results of our audit procedures, including the
procedures performed to address the matters below, provide the basis for our audit opinion on the
accompanying financial report.
1. Research and development rebate
Why significant
How our audit addressed the key audit matter
We involved our R&D taxation specialists to assess the
appropriateness of the R&D rebate calculated by the
Company’s third party expert.
We evaluated the qualifications, competency and
objectivity of the Company’s third party expert.
We assessed the Company’s accounting treatment of
the R&D rebate under Australian Accounting Standard
- AASB 120 Accounting for Government Grants and
Disclosure of Government Assistance.
The Company has recognised a rebate from the
Australian Taxation Office (ATO) for eligible Research
& Development (R&D) expenditure (R&D rebate)
relating to its ongoing research activities for the
development of Xanamem.
Included in trade and other receivables on the
statement of financial position and in Note 9 of the
financial report is an amount for $1.43 million related
to the R&D rebate calculated for the year ended 30
June 2021.
Due to judgment involved in determining whether
expenditure incurred in R&D activities meets the
eligibility criteria to qualify for inclusion in the R&D
rebate calculation and the significance of this source
of cash inflow for the Company, we considered this to
be a key audit matter.
2. Carrying value of intangible assets
Why significant
How our audit addressed the key audit matter
Included in the statement of financial position and in
Note 12 of the financial report is an amount for $3.03
million relating to intangible assets which consist of
patents and licenses. This amount represents 17% of
the Company’s total assets.
The Company had impaired these intangible assets in a
previous year and under accounting standards this
previous impairment remained available for reversal at
30 June 2021.
The Company assessed whether any indicators of
impairment reversal were present at 30 June 2021
and concluded that an impairment reversal indicator
was present in respect of these intangible assets.
Accordingly, the Company performed an impairment
reversal assessment and determined that no
impairment reversal was required as at 30 June 2021.
We challenged the Company’s assessment and
conclusion that, despite the presence of an indicator
of impairment reversal, that no impairment reversal
was required as at 30 June 2021.
In doing so, we examined the patent and licence
agreements relating to these capitalised intangible
assets and assessed the impairment reversal factors
considered by the Company pursuant to the
requirements of Australian Accounting Standards.
We assessed the adequacy of the disclosures in Note
12 to the financial report.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
68
Actinogen Medical Limited Due to the significance of the intangible assets to the
financial report as well as the high degree of judgment
involved both in determining whether indicators of
impairment reversal were present and, if so, whether
any portion of the previously recognised impairment
loss may need to be reversed, either in full or in part,
we consider this to be a key audit matter.
3. Share based payments
Why significant
How our audit addressed the key audit matter
We assessed the assumptions used in the Company’s
calculation of the share based payments expense,
including the share price of the underlying equity,
interest rate, volatility, time to maturity (expected
life), grant date and grant criteria.
We involved our valuation specialists in assessing
these assumptions and calculations.
We assessed the adequacy of the share based
payment disclosure in the financial report.
The Company issued 1,600,000 options and
48,362,300 limited recourse loan shares to key
management personnel in the year ended 30 June
2021. The options and limited recourse loan shares,
which are accounted for as in-substance options, vest
based on service conditions.
Under Australian Accounting Standards, equity settled
awards are measured at fair value on grant date and
an expense recognised taking into consideration the
probability of the vesting conditions attached. This
amount is recognised as an expense over the relevant
vesting period.
Due to the complex and judgmental estimates used in
determining the valuation of these share based
payments, we consider the Company’s calculation of
the share based payment expense to be a key audit
matter. Refer to Note 21 to the financial report for
details.
Information other than the financial report and auditor’s report
The directors are responsible for the other information. The other information comprises the
information included in the Company’s 2021 Annual Report but does not include the financial report
and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon, with the exception of the Remuneration Report
and our related assurance opinion.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
69
Annual Financial Report Independent Auditor’s Report (continued)
Responsibilities of the directors for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the Company’s ability to
continue as a going concern, disclosing, as applicable, matters relating to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Company or to
cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is
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 the Australian Auditing Standards 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 this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgment and maintain professional scepticism throughout the audit. We also:
•
•
•
•
Identify and assess the risks of material misstatement of the financial report, 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 Company’s internal control
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors
Conclude on the appropriateness of the 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 Company’s ability to continue as a
going concern. If we conclude that a material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures in the financial report 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 auditor’s report. However, future events or conditions
may cause the Company to cease to continue as a going concern
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
70
Actinogen Medical Limited •
Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events
in a manner that achieves fair presentation.
We communicate with the directors 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 directors 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, actions
taken to eliminate threats or safeguards applied.
From the matters communicated to the directors, we determine those matters that were of most
significance in the audit of the financial report of the current year 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 or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
Report on the audit of the remuneration report
Opinion on the remuneration report
We have audited the Remuneration Report included in the directors' report for the year ended 30
June 2021.
In our opinion, the Remuneration Report of the Company for the year ended 30 June 2021, complies
with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our
responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in
accordance with Australian Auditing Standards.
Ernst & Young
Pierre Dreyer
Partner
Perth
30 August 2021
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
71
Annual Financial Report Corporate Governance Statement
This Corporate Governance Statement (“Statement”) outlines the key aspects of the governance framework and main
governance practices of Actinogen Medical Limited (‘Actinogen Medical’ or ‘the Company’), a Company which is not included
within the S&P/ASX 300 index. The Company’s charters, policies, and procedures are regularly reviewed and updated to
comply with law and best practice. These charters and policies can be viewed on Actinogen Medical’s website located at
www.actinogen.com.au.
This Statement is structured with reference to the Australian Securities Exchange Corporate Governance Council’s (“the
Council’s”) “Corporate Governance Principles and Recommendations 4th Edition” (“the Recommendations”).
The Board of Directors has adopted the Recommendations to the extent that is deemed appropriate considering current the
size and operations of the Company. Therefore, considering the size and financial position of the Company, where the Board
considers that the cost of implementing a recommendation outweighs any potential benefits, those recommendations have not
been adopted.
As at the date of this Statement, the Board of Actinogen Medical Limited consists of four Directors. All of the Non-Executive
Directors are considered by the Board to be independent:
Dr Geoffrey Brooke
Independent Non-Executive Chairman
Dr Steven Gourlay
Managing Director
Dr George Morstyn
Independent Non-Executive Director
Mr Malcolm McComas Independent Non-Executive Director
This Statement was approved by the Board of Directors and is current as at 30 August 2021.
Principle 1: Lay solid foundations for management and oversight
A listed entity should clearly delineate the respective roles and responsibilities of its Board and management and regularly
review their performance.
1.1 A listed entity should have and disclose a Board Charter setting out the respective roles of the Board and
management and those matters expressly reserved to the Board and those delegated to management.
Actinogen Medical’s constitution (“Constitution”) provides that the business of the Company will be managed by or under the
direction of the Board. The Board operates under a Board Charter, a copy of which is located on the Company’s website at
www.actinogen.com.au.
The key roles and responsibilities of the Board along with the key roles and responsibilities of senior management, including
those specifically delegated to the Managing Director are set out in the Board Charter. The Board is responsible for evaluating
and setting the strategic direction for the Company, establishing goals for management and monitoring the achievement of
these goals. The Managing Director is responsible to the Board for the day-to-day management of the Company.
The principal functions and responsibilities of the Board include, but are not limited to, the following:
• Defining the Company’s purpose and setting its strategic objectives;
• Overseeing the Company, including its control and accountability systems;
• Demonstrating leadership;
•
•
•
•
•
•
Approving the Company’s statement of values and code of conduct to underpin the Company’s culture;
Appointing, evaluating, rewarding and if necessary, removing the Managing Director, the Company Secretary and senior
management personnel;
Appointing of removing the Chair;
Ensuring the Company’s remuneration policies are aligned with its values, strategic objectives and risk appetite;
In conjunction with members of the senior management team, develop corporate objectives, strategies and operations
plans and approve and appropriately monitor plans, new investments, major capital and operating expenditures, use of
capital, acquisitions, divestitures and major funding activities;
Establishing appropriate levels of delegation to the executive Directors to allow them to manage the business efficiently;
• Monitoring actual performance against planned performance expectations and reviewing operating information at a
requisite level, to understand at all times the financial and operating conditions of the Company, including reviewing and
approving annual budgets;
• Holding to account and monitoring the performance of senior management, including the implementation of strategy, and
ensuring appropriate resources are available to them;
72 Actinogen Medical Limited
•
Setting the Company’s risk appetite, identifying areas of significant business risk and ensure that the Company is
appropriately positioned to manage those risks;
• Overseeing the management of safety, occupational health and environmental matters;
•
•
•
Satisfying itself that the financial statements of the Company fairly and accurately set out the financial position and
financial performance of the Company for period under review;
Satisfying itself that there are appropriate reporting systems and controls in place to assure the Board that relevant
information is reported by the management to the Board and that proper operational, financial, compliance and internal
control processes are in place and functioning appropriately;
Ensuring the appropriate internal and external audit arrangements are in place and operating effectively;
• Having a framework in place to help ensure that the Company acts legally and responsibly on all matters consistent with
the Code of Conduct;
•
Reporting accurately to shareholders, on a timely basis; and
• Monitoring the effectiveness of the Company’s governance practices.
Subject to the specific authorities reserved to the Board under the Board Charter, the Board has delegated to the Managing
Director responsibility for the management and operation of Actinogen Medical. The Managing Director is responsible for the
day-to-day operations, financial performance and administration of Actinogen Medical within the powers authorised to him
from time-to-time by the Board. The Managing Director may make further delegation within the delegations specified by the
Board and is accountable to the Board for the exercise of those delegated powers.
The Board considers that the Company is not currently of a size, nor are its affairs of such complexity to justify the formation of
separate committees at this time, including Audit, Risk, Remuneration or Nomination Committees, preferring at this stage, to
manage the Company through the full Board of Directors. The Board assumes the responsibilities normally delegated to the
Audit, Risk, Remuneration and Nomination Committees.
If the Company’s activities increase, in size, scope and nature, the appointment of separate committees will be reviewed by the
Board and implemented if appropriate.
Directors have a right of access to all Company information and executives. Directors are entitled, in fulfilling their duties and
responsibilities, to obtain independent professional advice on any matter connected with the discharge of their responsibilities,
with prior notice to the Chairman, at Actinogen Medical’s expense.
Further details of Board responsibilities, objectives and structure are set out in the Board Charter on the Actinogen Medical
website.
1.2 A listed entity should undertake appropriate checks before appointing a Director or senior executive or putting
someone forward for election as a Director and provide security holders with all material information in its possession
relevant to a decision on whether or not to elect or re-elect a Director.
The Constitution of the Company sets out the process of appointment, retirement and rotation of directors.
The Company undertakes comprehensive reference checks prior to appointing a Director or putting that person forward as a
candidate to ensure that person is competent, experienced, and would not be impaired in any way from undertaking the duties
of Director. The Company provides relevant information to shareholders for their consideration about the attributes of
candidates together with whether the Board supports the appointment or re-election.
1.3 A listed entity should have a written agreement with each Director and senior executive setting out the terms of their
appointment.
The appointment of any new Director (executive or non-executive) of Actinogen Medical and each senior executive is made by,
and in accordance with, a formal letter of appointment or written agreement setting out the key terms and conditions relative
at the time of appointment. All current agreements are made with the Director or senior executive personally.
1.4 The Company Secretary of a listed entity should be directly accountable to the Board, through the Chair, on all
matters to do with the proper functioning of the Board.
In accordance with the Board Charter, the decision to appoint or remove the Company Secretary must be made or approved by
the Board.
The Company Secretary is accountable directly to the Board, through the Chairperson, on all matters to do with the proper
functioning of the Board, including agendas, Board papers and minutes, advising the Board and its Committees (as applicable)
on governance matters, monitoring that the Board and Committee policies and procedures are followed, communication with
regulatory bodies and the ASX and statutory and other filings.
1.5 A listed entity should have and disclose a Diversity Policy; set measurable objectives for achieving gender diversity
and disclose the measurable objectives set to achieve gender diversity.
The Board has adopted a Diversity Policy which is available on its website and provides a framework for the Company to
establish and achieve measurable diversity objectives, including in respect to gender, age, ethnicity and cultural diversity. The
Annual Financial Report 73
Corporate Governance Statement
(continued)
Diversity Policy allows the Board to set measurable gender diversity objectives (if considered appropriate) and to assess
annually both the objectives (if any have been set) and the Company’s progress towards achieving them.
The Board has not yet set measurable objectives for achieving gender diversity. The Board is acutely aware of the importance
for gender diversity within the workforce and looks to achieve a culture of inclusion when assessing a suitable candidate for an
open position and through its day-to-day practices
The participation of women in the Company at the date of this report is as follows:
• Women on the board: 0 of 4 (0%)
• Women in senior executive positions: 1 of 2 (50%)
• Women in the organisation: 5 of 12 (42%)
The Company is not a “relevant employer” under the Workplace Gender Equality Act.
The Company’s Diversity Policy is available on its website.
1.6 A listed entity should have and disclose a process for periodically evaluating the performance of the Board, its
committees and individual Directors.
On an annual basis, the Board conducts a review of its structure, composition and performance.
The annual review includes consideration of the following measures:
•
•
•
•
•
•
•
the currency of the Directors’ knowledge and skills if the Directors’ performance has been impacted by other
commitments;
comparing the performance of the Board against the requirements of its Charter;
assessing the performance of the Board over the previous 12 months having regard to the corporate strategies, operating
plans and the annual budget;
reviewing the Board’s interaction with management;
reviewing the type and timing of information provided to the Board by management;
reviewing management’s performance in assisting the Board to meet its objectives; and
identifying any necessary or desirable improvements to the Board Charter.
The method and scope of the performance evaluation will be set by the Board and may include a Board self-assessment
checklist to be completed by each Director. The Board may also use an independent adviser to assist in the review.
The Chairman has primary responsibility for conducting performance appraisals of Non-Executive Directors, in conjunction with
them, having particular regard to:
•
•
•
•
contribution to Board discussion and function;
degree of independence including relevance of any conflicts of interest;
availability for and attendance at Board meetings and other relevant events;
contribution to Company strategy;
• membership of and contribution to any Board committees; and
•
suitability to Board structure and composition.
A Board performance review was conducted during the year in accordance with the above process.
1.7 A listed entity should have and disclose a process for periodically evaluating the performance of its senior
executives.
The Company has an annual performance review process in place for its Managing Director and other senior executives. On an
annual basis, corporate objectives and individual key performance indicators (KPIs) are set. The Managing Director reviews
the performance of senior executives and their delivery of corporate and individual objectives.
Performance reviews of senior executives were conducted during the year in accordance with the above process.
74 Actinogen Medical Limited
Principle 2: Structure the board to be effective and add value
The Board of a listed entity should be of an appropriate size and collectively have the skills, commitment and knowledge of the
entity and the industry in which it operates, to enable it to discharge its duties effectively and to add value.
2.1 The Board of listed entity should have a nomination committee or, if it does not have a nomination committee,
disclose the fact and the processes it employs to address Board succession issues and to ensure that the Board has
the appropriate balance of skill, knowledge, experience, independence and diversity to enable it to discharge its
duties and responsibilities effectively.
The Board considers that the Company does not currently benefit from the establishment of a separate Nomination
Committee. In accordance with the Company’s Board Charter and operating within the boundaries of the Remuneration and
Nomination Policy, the Board is responsible for the nomination and selection of directors.
The Board considers that a diverse range of skills, backgrounds, knowledge and experience is required in order to effectively
govern Actinogen Medical. The Board believes that orderly succession and renewal contributes to strong corporate
governance and is achieved by careful planning and continual review.
The Board reviews the size and composition of the Board regularly and at least once a year as part of the Board evaluation
process. When the need for a new director is identified, the required experience and competencies of the new director are
defined in the context of the skills matrix and any gaps that may exist.
Generally a list of potential candidates is identified based on these skills required and other issues such as geographic location
and diversity criteria. Candidates are assessed against the required skills and on their qualifications, backgrounds and
personal qualities. In addition, candidates are sought who have a proven track record in creating security holder value and the
required time to commit to the position.
2.2 A listed entity should have and disclose a Board skills matrix setting out the mix of skills that the Board currently has
or is looking to achieve.
The Board has a skills matrix covering the competencies and experience of each Director. The results of the skills matrix
assessment in relation to the Board as a whole is displayed on the Company’s website at www.actinogen.com.au.
2.3 A listed entity should disclose the names of the Directors considered by the Board to be independent Directors and
the length of service of each Director.
Director
Length of Service
Dr Geoffrey Brooke
Independent Non-Executive Chairman (appointed 1 March 2017)
Executive Chairman (interim period 8 February 2021 to 24 March 2021)
Dr Steven Gourlay
Managing Director (appointed 24 March 2021) and;
Chief Executive Officer & Chief Medical Officer (appointed 15 March 2021)
Dr George Morstyn
Independent Non-Executive Director (appointed 1 December 2017)
Mr Malcolm McComas Independent Non-Executive Director (appointed 4 April 2019)
Dr Bill Ketelbey
Managing Director (appointed 18 December 2014, ceased 8 February 2021)
2.4 A majority of the Board should be independent Directors.
The Board, at the date of this statement is comprised of a majority of independent Directors. Dr Geoffrey Brooke, Dr George
Morstyn and Mr Malcolm McComas are the current directors considered to be independent. Dr Steven Gourlay is not
considered to be an independent Director by virtue of him being an executive of the Company. Actinogen Medical has adopted
a definition of 'independence' for Directors that is consistent with the Recommendations.
2.5 The chair of the board of a listed entity should be an independent Director and, in particular, should not be the same
person as the CEO of the entity.
Dr Geoffrey Brooke is the Chairman of the Company and is considered by the Board to be independent and is not the same
person as the CEO of the Company.
2.6 A listed entity should have a program for inducting new Directors and for periodically reviewing whether there is a
need for existing Directors to undertake professional development to maintain the skills and knowledge needed to
perform their role as Directors effectively.
In accordance with the Company’s Procedures for Selection and Appointment of Directors, the Board is responsible for the
approval and review of induction and continuing professional development programs and procedures for Directors to ensure
that they can effectively discharge their responsibilities.
New Directors are issued with a formal Letter of Appointment that sets out the key terms and conditions of their appointment,
including Director's duties, rights and responsibilities, the time commitment envisaged, and the Board's expectations regarding
involvement with any Committee work.
The Company Secretary is responsible for facilitating inductions and professional development that is tailored to the
individual’s needs.
Annual Financial Report 75
Corporate Governance Statement
(continued)
Principle 3: Instil a culture of acting lawfully, ethically and responsibly
A listed entity should instil and continually reinforce a culture across the organisation of acting lawfully, ethically and
responsibly.
3.1 A listed entity should articulate and disclose its values
Actinogen Medical has adopted a Statement of Values that underpins the commitment that each individual and the Company
as a whole lives by each and every day and includes the following values:
1. Respect: Foster a respectful, dynamic and friendly work environment with support for all employees, contractors,
collaborators, consultants, stakeholders and partners;
2. Patient-Focussed: Seek to improve the lives of patients by advancing healthcare and furthering the collective body of
medical and scientific knowledge;
3.
Innovation: Commit to pursue innovation in drug development, providing employees with an engaging and challenging
workplace while creating compelling solutions for patients, caregivers, shareholders and the global medical, scientific and
research communities;
4.
Integrity: Model honest and ethical conduct and behaviour, always being fully accountable across all business operations,
with no compromise to integrity;
5. Excellence: Inspire excellence and garner respect through strong leadership across the Company, taking pride in the
quality of all processes and outputs; and
6. Value: Instil a foundation level of high-quality value while striving to deliver maximum value to shareholders.
3.2 A listed entity should have and disclose a Code of Conduct for its Directors, senior executives and employees and
ensure that the Board or a committee of the Board is informed of any material breaches of that Code.
The Company has implemented a Code of Conduct, which provides guidelines aimed at maintaining high ethical standards,
corporate behaviour and accountability within the Company.
All employees and Directors are expected to:
•
•
•
•
•
•
•
•
•
act honestly, in good faith and in the best interests of the Company as a whole;
use due care and diligence in fulfilling the functions of their position and exercising the powers attached to their
employment;
recognizes that their primary responsibility is to the Company’s shareholders as a whole;
protect the assets of the Company to ensure availability for legitimate business purposes and ensure all corporate
opportunities are enjoyed by the Company;
not to take advantage of their position for personal gain, o the gain of their associates;
disclose and deal appropriately with any conflicts between their personal interests and their duties as a Director, senior
executive, KMP, officer or employee of the Company;
not to take advantage of their position or the opportunities arising from their position for personal gain;
not to take advantage of the property or confidential information of the Company or its customers for personal gain or to
cause detriment to the Company or its customers. Confidential information can only by release or used with specific
permission from the Company; and
comply with the spirit, as well as the letter, of the law which affects its operations, wherever it operates, and with the
principles of this code. Where the Company operates overseas, it shall comply with the relevant local laws as well as any
applicable Australian laws.
An employee that breaches the Code of Conduct may face disciplinary action including, in the cases of serious breaches,
dismissal. If an employee suspects that a breach of the Code of Conduct has occurred or will occur, he or she must report that
breach to the Company Secretary, or in his absence, the Chairperson. No employee will be disadvantaged or prejudiced if he
or she reports in good faith a suspected breach. All reports will be acted upon and kept confidential.
3.3 A listed entity should have and disclose a Whistleblower Policy and ensure that the Board or a committee of the Board
is informed of any material incidents reported under that Policy.
The Company has adopted a Whistleblower Protection Policy which is available on the Company’s website.
The Policy includes that the Board will be informed of any material incidents reported under that Policy.
76 Actinogen Medical Limited
3.4 A listed entity should have and disclose an Anti-Bribery and Corruption Policy and ensure that the Board or a
committee of the Board is informed of any material breaches of that Policy.
The Company has adopted an Anti-Bribery and Corruption Policy which is available on the Company’s website.
The Policy includes that the Board will be informed of any material breaches of that Policy.
Principle 4: Safeguard integrity in corporate reporting
A listed entity should have appropriate processes to verify the integrity of its corporate reports.
4.1 A Board of listed entity should have an audit committee or if it does not have an audit committee, disclose the fact and
the processes it employs that independently verify and safeguard the integrity of its corporate reporting, including
the processes for the appointment and removal of the external auditor and the rotation of the audit engagement
partner.
The Board considers that the Company does not currently benefit from the establishment of a separate Audit Committee. The
Board as a whole fulfills the functions normally delegated to the Audit Committee as detailed in the Audit Committee Charter.
The Board is responsible for the initial appointment of the external auditor and the appointment of a new external auditor when
any vacancy arises. Candidates for the position of external auditor must demonstrate complete independence from the
Company through the engagement period. The Board may otherwise select an external auditor based on criteria relevant to
the Company’s business and circumstances. The performance of the external auditor is reviewed on an annual basis by the
Board.
The Board receives regular reports from management and from external auditors. It also meets with the external auditors as
and when required. The external auditors attend Actinogen Medical's AGM and are available to answer questions from security
holders relevant to the audit.
Prior approval of the Board must be gained for non-audit work to be performed by the external auditor. There are qualitative
limits on this non-audit work to ensure that the independence of the auditor is maintained.
There is also a requirement that the audit partner responsible for the audit not perform in that role for more than five years.
4.2 A Board of listed entity should, before it approves the entity’s financial statements for a financial period, receive from
its CEO and CFO a declaration that, in their opinion, the financial records of the entity have been properly maintained
and that the financial statements comply with the appropriate accounting standards and give a true and fair view of
the financial position and performance of the entity and that the opinion has been formed on the basis of a sound
system of risk management and internal control which is operating effectively.
The Board has received certifications from the CEO and CFO Equivalent in connection with the financial statements for
Actinogen Medical for the Reporting Period. The certifications state that the declaration provided in accordance with Section
295A of the Corporations Act as to the integrity of the financial statements is founded on a sound system of risk management
and internal control which is operating effectively.
4.3 A listed entity should disclose its process to verify the integrity of any periodic corporate report it releases to the
market that is not audited or reviewed by an external auditor.
In reviewing the quarterly cashflow reports and prior to lodgement with the ASX, the following process has been adopted:
•
•
•
cash transactions for the quarter are provided by the accountant to the Chief Financial Officer (equivalent);
cash transactions are matched against the bank statements; and
quarterly figures are compiled and verified by the CFO (equivalent) and CEO.
A declaration is then provided by the CFO (equivalent) and CEO to the Board noting compliance section 286 of the
Corporations Act 2001, the appropriate accounting standards and with Listing Rule 19.11A.
Principle 5: Make timely and balanced disclosure
A listed entity should make timely and balanced disclosure of all matters concerning it that a reasonable person would expect
to have a material effect on the price or value of its securities.
5.1 A listed entity should have and disclose a written policy for complying with its continuous disclosure obligations
under listing rule 3.1.
The Company has a Continuous Disclosure Policy which outlines the disclosure obligations of the Company as required under
the ASX Listing Rules and Corporations Act. The policy is designed to ensure that procedures are in place so that the market is
properly informed of matters which may have a material impact on the price at which Company securities are traded.
The Board considers whether there are any matters requiring disclosure in respect of each and every item of business that it
considers in its meetings. Individual Directors are required to make such a consideration when they become aware of any
information in the course of their duties as a Director of the Company.
The Company is committed to ensuring all investors have equal and timely access to material information concerning the
Company.
Annual Financial Report 77
Corporate Governance Statement
(continued)
The Board has designated the Company Secretary as the person responsible for communicating with the ASX. The Chairman,
Managing Director and the Company Secretary are responsible for ensuring that:
(a) All material market announcements are to be circulated to and reviewed by all members of the Board;
(b) All announcements are clearly noted as to the authorising officer and in general, all material announcements are
authorised for release by the Board;
(c) All announcements are made in a timely manner, are factual and do not omit any material information required to be
disclosed under the ASX Listing Rules and Corporations Act;
(d) All announcements are expressed in a clear and objective manner that allows investors to assess the impact of the
information when making investment decisions; and
(e) Any new and substantive investor or analyst presentation will be released on the ASX Market Announcements Platform
ahead of the presentation
5.2 A listed entity should ensure that its Board receives copies of all material market announcements after they have
been made.
The Board receives copies of all material market announcements after they have been made.
5.3 A listed entity that gives a new and substantive investor or analyst presentation should release a copy of the
presentation materials on the ASX Market Announcements Platform ahead of the presentation.
Any new and substantive investor or analyst presentation will be released on the ASX market announcements platform ahead
of the presentation.
Principle 6: Respect the rights of security holders
A listed entity should provide its security holders with appropriate information and facilities to allow them to exercise their
rights as security holders effectively.
6.1 A listed entity should provide information about itself and its governance framework to investors via its website.
The Company respects the rights of its shareholders and to facilitate the effective exercise of those rights the Company is
committed to:
•
•
communicating effectively with shareholders through releases to the market via the ASX, the Company’s website,
information emailed or mailed to shareholders and the general meetings of the Company;
giving shareholders ready access to clear and understandable information about the Company; and
• making it easy for shareholders to participate in general meetings of the Company.
Actinogen Medical’s register is maintained by a professional security registry, Automic Group. Shareholders are able to
communicate with the Company and Automic via email and can register to receive communications and shareholder materials
from the Company via its security registry electronically.
The Company also makes available a telephone number and email address for shareholders to make enquiries of the
Company. These contact details are available on the “contact us” page of the Company’s website.
The Company maintains information in relation to its Constitution, governance documents, Directors and senior executives,
Board and committee charters, annual reports and ASX announcements on the Company’s website.
6.3 A listed entity should disclose how it facilitates and encourages participation at meetings of security holders.
The Shareholder Communication Policy provides that security holders are encouraged to attend and participate at general
meetings. To facilitate this, meetings will be held during normal business hours, at a place, or in a manner, convenient for the
greatest possible number of security holders to attend either in person or electronically. Moreover, Actinogen Medical’s
Constitution allows, if permitted by law, shareholder meetings to be held electronically and provides each security holder with
the right to appoint a proxy, attorney or representative to vote on their behalf.
6.4 A listed entity should ensure that all substantive resolutions at a meeting of security holders are decided by a poll
rather than by a show of hands.
The Company has a policy that all substantive resolutions at a meeting of security holders are to be decided by a poll.
78 Actinogen Medical Limited
6.5 A listed entity should give security holders the option to receive communications from and send communications to,
the entity and its security registry electronically.
The Company provides security holders the option to electronically receive communications from, and send communications
to, the Company and its share registry, Automic Registry Services. The Company encourages security holders to utilise
electronic communications with the Company to facilitate speed, convenience and environmental friendliness of
communications.
Principle 7: Recognise and manage risk
A listed entity should establish a sound risk management framework and periodically review the effectiveness of that
framework.
7.1 The Board of a listed entity should have a committee or committees that oversee risk and if it does not have a risk
committee or committees, disclose that fact and the processes it employs for overseeing the entity’s risk
management framework
The Board considers that the Company does not currently benefit from the establishment of a separate Risk Committee. In
accordance with the Company’s Board Charter and operating within the boundaries of the Risk Management and Internal
Compliance and Control Policy, the Board carries out the duties that would ordinarily be carried out by the Risk Committee
under the Risk Management and Internal Compliance and Control Policy.
The Board is responsible for the oversight of the Company’s risk management and internal compliance and control framework.
Responsibility for control and risk management is delegated to the appropriate level of management within the Company with
the Managing Director having ultimate responsibility to the Board for the risk management and internal compliance and control
framework. Actinogen Medical has established policies for the oversight and management of material business risks.
Actinogen Medical's Risk Management and Internal Compliance and Control Policy recognises that risk management is an
essential element of good corporate governance and fundamental in achieving its strategic and operational objectives. Risk
management improves decision making, defines opportunities and mitigates material events that may impact security holder
value.
Actinogen Medical believes that explicit and effective risk management is a source of insight and competitive advantage. To
this end, Actinogen Medical is committed to the ongoing development of a strategic and consistent enterprise-wide risk
management program, underpinned by a risk conscious culture.
Actinogen Medical accepts that risk is a part of doing business. Therefore, the Company’s Risk Management and Internal
Compliance and Control Policy is not designed to promote risk avoidance. Rather Actinogen Medical's approach is to create a
risk conscious culture that encourages the systematic identification, management and control of risks while ensuring we do not
enter into unnecessary risks or enter into risks unknowingly.
Actinogen Medical assesses its risks on a residual basis; that is, it evaluates the level of risk remaining and considering all the
mitigation practices and controls. Depending on the materiality of the risks, Actinogen Medical applies varying levels of
management plans.
7.2 The Board or a committee of the Board should review the entity’s risk management framework at least annually to
satisfy itself that it continues to be sound and that the entity is operating with due regard to the risk appetite set by
the Board and disclose, in relation to each reporting period, whether such a review has taken place.
The Board reviews the Company’s risk management framework at each scheduled Board meeting to ensure that it continues to
effectively manage risk.
7.3 A listed entity should disclose if it has an internal audit function or if it does not have an internal audit function, that
fact and the processes it employs for evaluating and continually improving the effectiveness of its governance, risk
management and internal control processes.
The Company does not have an internal audit function.
The Board has required management to design and implement a risk management and internal compliance and control system
to manage Actinogen Medical's material business risks. It receives regular reports on specific business areas where there may
exist significant business risk or exposure. The Company faces risks inherent to its business, including economic risks, which
may materially impact the Company’s ability to create or preserve value for security holders over the short, medium or long
term. The Company has in place policies and procedures, including a risk management framework (as described in the
Company’s Risk Management and Internal Compliance and Control Policy), which is developed and updated to help manage
these risks. The Board does not consider that the Company currently has any material exposure to environmental or social
sustainability risks
The Company’s process of risk management and internal compliance and control includes:
•
•
identifying and measuring risks that might impact upon the achievement of the Company’s goals and objectives, and
monitoring the environment for emerging factors and trends that affect those risks.
formulating risk management strategies to manage identified risks and designing and implementing appropriate risk
management policies and internal controls.
Annual Financial Report 79
Corporate Governance Statement
(continued)
• monitoring the performance of, and improving the effectiveness of, risk management systems and internal compliance and
controls, including regular assessment of the effectiveness of risk management and internal compliance and control.
The Board reviews the Company’s risk management framework at least annually to ensure that it continues to effectively
manage risk.
Management reports to the Board as to the effectiveness of Actinogen Medical's management of its material business risks at
each scheduled Board meeting.
7.4 A listed entity should disclose whether it has any material exposure to environmental or social risks and, if it does,
how it manages or intends to manage those risks.
The Board does not consider that the Company currently has any material exposure to environmental or social risks.
Principle 8: Remunerate fairly and responsibly
A listed entity should pay Director remuneration sufficient to attract and retain high quality directors and design its executive
remuneration to attract, retain and motivate high quality senior executives and to align their interests with the creation of value
for security holders and with the entity’s values and risk appetite.
8.1 The Board of a listed entity should have a remuneration committee or if it does not have a remuneration committee,
disclose that fact and the processes it employs for setting the level and composition of remuneration for Directors
and senior executives and ensuring that such remuneration is appropriate and not excessive.
The Company does not have a Remuneration Committee. The Board considers that the Company will not currently benefit from
the establishment of a Remuneration Committee and as a whole fulfills the functions normally delegated to the Remuneration
Committee as detailed in the Remuneration and Nomination Policy.
In accordance with the Company’s Board Charter, the Board carries out the duties that would ordinarily be carried out by the
Remuneration Committee under the Remuneration Committee Charter, including devoting time annually to assess the level and
composition of remuneration for Directors and senior executives.
8.2 A listed entity should separately disclose its policies and practices regarding the remuneration of non-executive
Directors and the remuneration of executive Directors and other senior executives.
Actinogen Medical’s Remuneration Policy was designed to recognise the competitive environment within which Actinogen
Medical operates and also to emphasise the requirement to attract and retain high calibre talent in order to achieve sustained
improvement in Actinogen Medical’s performance. The overriding objective of the Remuneration Policy is to ensure that an
individual’s remuneration package accurately reflects their experience, level of responsibility, individual performance and the
performance of Actinogen Medical.
The key principles are to:
•
•
link executive reward with strategic goals and sustainable performance of Actinogen Medical;
apply challenging corporate and individual key performance indicators that focus on both short-term and long-term
outcomes;
• motivate and recognise superior performers with fair, consistent and competitive rewards;
•
•
•
remunerate fairly and competitively in order to attract and retain top talent;
recognise capabilities and promote opportunities for career and professional development; and
through employee ownership of Actinogen Medical shares, foster a partnership between employees and other security
holders.
The Board determines the Company’s remuneration policies and practices and assesses the necessary and desirable
competencies of Board members. The Board is responsible for evaluating Board performance, reviewing Board and
management succession plans and determines remuneration packages for the CEO, Non-Executive Directors and senior
management based on an annual review.
Actinogen Medical’s executive remuneration policies and structures and details of remuneration paid to Directors and senior
managers are set out in the Remuneration Report contained within the Annual Report.
Non-Executive Directors receive fees (including statutory superannuation where applicable) for their services, the
reimbursement of reasonable expenses and, in certain circumstances options. They do not receive any termination or
retirement benefits, other than statutory superannuation.
80 Actinogen Medical Limited
The maximum aggregate remuneration approved by shareholders for Non-Executive Directors is $500,000 per annum. The
Directors set the individual Non-Executive Directors fees within the limit approved by shareholders.
The total fees paid to Non-Executive Directors during the reporting period was $231,000.
Executive Directors and other senior executives are remunerated using combinations of fixed and performance based
remuneration. Fees and salaries are set at levels reflecting market rates and performance based remuneration is linked directly
to specific performance targets that are aligned to both short and long term objectives.
Further details in relation to the Company’s remuneration policies are contained in the Remuneration Report, within the
Directors’ Report.
8.3 A listed entity which has an equity-based remuneration scheme should have a policy on whether participants are
permitted to enter into transactions (whether through the use of derivatives or otherwise) which limit the economic
risk of participating in the scheme and disclose that policy or a summary of it.
In accordance with the Company’s Securities Trading Policy, participants in an equity-based incentive scheme are prohibited
from entering into any transaction that would have the effect of hedging or otherwise transferring the risk of any fluctuation in
the value of any unvested entitlement in the Company’s securities to any other person.
Annual Financial Report 81
Shareholder Information
Substantial shareholders:
The following substantial shareholders have lodged notices with the company as at 24 August 2021:
Holders
Shares
Percentage of
Issued Capital
BVF Partners L.P. on its own behalf and on behalf of BVF Inc., Mark N Lampert,
Biotechnology Value Fund, L.P.; and Biotechnology Value Fund II, L.P.
239,927,273
14.88%
Distribution of ordinary shareholders as at 24 August 2021
Range of Holding
1-1,000
1,001-5,000
5,001-10,000
10,001 - 100,000
100,001 – over
Total
Holders
87
256
494
Shares
11,564
947,049
4,111,466
2,239
96,761,972
1,375
1,558,726,496
4,451
1,660,558,547
Shareholders with less than a marketable parcel
358
Voting Rights: Each fully paid ordinary share carries voting rights of one vote per share. No voting rights attach to unlisted
options.
Twenty Largest holders of quoted ordinary shares as at 24 August 2021
HSBC Custody Nominees (Australia) Limited
249,813,605
15.04%
Number of
Shares
Percentage of
Issued Capital
Dr Steven Gourlay
Edinburgh Technology Fund Limited
JSC Wealth Management Pty Ltd
Tisia Nominees Pty Ltd
Citicorp Nominees Pty Limited
Garnsworthy Pension Fund Pty Ltd
SG Gourlay Nominees Pty Ltd
Big Eater Pty Ltd
Mr James Murch & Mrs Catherine Murch
BNP Paribas Nominees Pty Ltd Hub24 Custodial Serv Ltd
Mrs Gillian Karen Nes & Mrs Ronald Nes
Surfit Capital Pty Ltd
Oaktone Nominees Pty Ltd
Brazil Farming Pty Ltd
Double Jay Group Holdings Pty Ltd
National Nominees Limited
Amber Court Nominees Pty Ltd
Kaleidoscope Holdings Pty Ltd
John Dahlsen Superannuation Fund Pty Ltd
48,362,300
48,147,864
44,655,962
33,440,621
19,464,401
16,500,000
15,000,000
15,000,000
15,000,000
13,247,438
13,000,000
12,500,000
12,000,000
12,000,000
11,475,253
11,282,894
11,265,203
10,800,000
10,411,036
2.91%
2.90%
2.69%
2.01%
1.17%
0.99%
0.90%
0.90%
0.90%
0.80%
0.78%
0.75%
0.72%
0.72%
0.69%
0.68%
0.68%
0.65%
0.63%
TOTAL
623,366,577
37.54%
82 Actinogen Medical Limited
Unquoted Securities as at 24 August 2021
1.
There were 1,500,000 unlisted options exercisable at $0.10 each and expiring on 1 December 2022 held by one
holder, on issue. Details of the holders holding more than 20% of the above:
George Morstyn
1,500,000
100.00%
Number of Options
Percentage
2.
There were 15,175,000 unlisted options exercisable at $0.085 each and expiring on 27 November 2023 held by three
holders, on issue. Details of the holders holding more than 20% of the above:
John William Ketelbey
Geoffrey Edward Duncan Brooke
Number of Options
Percentage
8,775,000
4,900,000
57.83%
32.29%
3.
4.
There were 5,783,333 unlisted employee share option plan options exercisable at $0.085 each and expiring on 12
December 2023 held by six holders, on issue.
There were 5,000,000 unlisted options exercisable at $0.093 each and expiring on 1 February 2024 held by one
holder, on issue. Details of the holders holding more than 20% of the above:
Bio-Link Australia Pty Ltd
5,000,000
100.00%
Number of Options
Percentage
5.
There were 3,000,000 unlisted options exercisable at $0.10 each and expiring on 4 April 2024 held by one holder, on
issue. Details of the holders holding more than 20% of the above:
Malcolm John McComas
3,000,000
100.00%
Number of Options
Percentage
6.
There were 5,000,000 unlisted options exercisable at $0.10 each and expiring on 24 March 2025 held by one holder,
on issue. Details of the holders holding more than 20% of the above:
Geoffrey Edward Duncan Brooke
5,000,000
100.00%
Number of Options
Percentage
7.
There were 1,600,000 unlisted employee share option plan options exercisable at $0.046 each and expiring on 27
September 2025 held by one holder, on issue.
Restricted Securities
The Company has no securities on issue that are subject to either ASX or voluntary escrow.
On-Market Buy-Back
There is no current on-market buy back in place.
Annual Financial Report 83
Corporate Directory
Board of Directors
Dr Geoffrey Brooke - Non-Executive Chairman
Dr Steven Gourlay - Managing Director & Chief Executive Officer
Dr George Morstyn - Non-Executive Director
Mr Malcolm McComas - Non-Executive Director
Company Secretary
Mr Peter Webse
Principal Place of Business / Registered Office
Suite 901
Level 9
109 Pitt Street
Sydney NSW 2000
Contact Details
Telephone: 02 8964 7401
www.actinogen.com.au
ABN 14 086 778 476
Lawyers
K&L Gates
Level 25 South Tower
525 Collins Street
Melbourne VIC 3000
Share Register
Automic Group
Level 5
126 Phillip Street
Sydney NSW 2000
Auditors
Ernst & Young
Australia
Actinogen Medical Limited shares are listed on
the Australian Securities Exchange ('ASX').
ASX Code: ACW
84 Actinogen Medical Limited