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Australia
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Annual Report 2017
Contents to Annual Report
Operations Report
Intellectual Property Report
Directors’ Report
Auditor's Independence Declaration
Corporate Governance
Statement of Profit or Loss & Other
Comprehensive Income
Statement of Financial Position
Statement of Changes in Equity
Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Shareholder Information
Corporate Information
Page
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5
8
20
21
28
29
30
31
32
53
54
58
60
Operations Report
Overview of Company’s Activities
Antisense Therapeutics Limited (“the Company” or
“Antisense Therapeutics”) continued its focus on
advancing its antisense oligonucleotide products under
development. The following report on operations details
the research and development activities undertaken by the
Company in the period.
Capital Management Initiatives
ATL1103 is in clinical development as a treatment
for acromegaly. Normalizing serum IGF-I levels is the
therapeutic goal in the treatment of acromegaly and
reducing the effects of IGF-I has a potential role in the
treatment of diabetic retinopathy, nephropathy and
certain forms of cancer. The Company conducted a
successful Phase II trial of ATL1103 with the trial having
met its primary efficacy endpoint by showing a statistically
significant average reduction in sIGF-1 levels. The Company
also announced that it was conducting a high dose study of
ATL1103 in adult patients with acromegaly in Australia.
During the period the Company completed the following
capital management initiatives.
Progress
On 8th February 2017 the Company reported that it
had completed its less than marketable parcel program
Company. A total of 1,164 shareholders, with an aggregate
of 3,783,086 shares participated in the program. The
shares were sold as an off market transaction at a price
of 3.8 cents per share and the proceeds distributed to
participants.
Antisense Therapeutics reduced the share capital of the
Company by cancelling all ordinary shares held by the
company formerly named Cortendo Cayman Ltd
(being 15, 025, 075 fully paid ordinary shares) for no
consideration. The reduction of capital represented a
reduction of 8.5% of the issued capital in the Company.
On 20th December 2016 the Company issued
approximately 68 million options in the Bonus and New
Option issue announced on 11th October 2016.
ATL1103 for Acromegaly
ATL1103 is an antisense drug designed to block growth
hormone receptor (GHr) expression thereby reducing levels
of the hormone insulin-like growth factor-I (IGF-I) in the
blood and is a potential treatment for diseases associated
with excessive growth hormone action. By inhibiting
GHr production, ATL1103 in turn reduces IGF-I levels in
the blood (serum). There are a number of diseases that
are associated with excess GH and IGF-I action. These
diseases include acromegaly, an abnormal growth disorder
of organs, face, hands and feet; diabetic retinopathy, a
common disease of the eye and a major cause of blindness;
diabetic nephropathy, a common disease of the kidney and
major cause of kidney failure, and certain forms of cancer.
On 13th July the Company reported certain advancements
that had been made in expanding the intellectual property
(IP) portfolio protecting ATL1103. These advancements
included both the grant of US patent 9,371,350
(14/137,852) entitled “Modulation of Growth Hormone
Receptor Expression and insulin like growth factor
expression” and NZ patent 629004 entitled “Combination
Therapy comprising a growth hormone variant and an
oligonucleotide targeted to the growth hormone receptor.
On 27th July the Company announced positive results from
the Interim Analysis of ATL1103 Higher Dose Study. The
higher dose study was an open-label study of the safety,
tolerability, pharmacokinetics and efficacy in acromegaly
patients. Three patients were enrolled in the study and
dosed with ATL1103 at 300 mg twice weekly (2 patients),
capped at a weekly dose of 6 mg/kg (1 patient). All 3
patients were dosed for 13 weeks, with one patient at the
request of the Principal Investigator receiving an extended
dosing period of an additional 12 weeks. There was a
follow-up period of 2 months for all patients.
The Company reported that sIGF-I levels were reduced in
all 3 patients by an average of 18.6% (P = 0.06) at week
14 (one week past the last dose which is the primary
efficacy endpoint in the trial) and an average of 26.7%
at week 13 being the last week of dosing (P = 0.04).
Normalisation of sIGF-I was achieved in one patient who
received the highest weekly dose per kg of bodyweight
(6 mg/kg/week). ATL1103 appeared to be well-tolerated
at the higher mg doses tested in the trial. No patient
withdrew from the study and there were no serious
adverse events reported.
ANNUAL REPORT 2017 1
Operations Report continued
On 11th October the Company reported the completion
of the Higher Dose clinical trial of ATL1103 in acromegaly
patients. In the 11th October announcement, the Company
reported that the 3rd patient’s IGF-I level had been
normalised during the extended dosing period. Maximal
suppression of IGF-I in that patient was 44% from baseline
at week 26 (vs 33% at week 13). This is higher than the
mean reduction reported in the interim analysis (26.7%
at week 13 and 18.6% at week 14) was consistent with
ATL1103 dose modelling predictions that greater effects in
reducing sIGF-1 are achievable with longer ATL1103 dosing
regimens. There were no new significant adverse safety
findings beyond those reported on 27 July 2016. ATL1103
appeared to be well-tolerated at the higher mg doses
tested in the trial. No patient withdrew from the study and
no serious adverse events reported.
On 23rd February the Company reported that the
World Health Organization had published the proposed
International Non-proprietary Name - atesidorsen - for
ATL1103. A non-proprietary name is also known as a
generic name.
On 24th February the Company reported on advancements
made in expanding its IP portfolio protecting ATL1103. These
advancements included the allowance of the claims of the
European patent application 04715642.7 and Japanese
patent application 2014-138603, both entitled “Modulation
of Growth Hormone Receptor Expression and insulin like
growth factor expression”. The Company reported that it
now had all of its patents that cover the compound ATL1103
registered or allowed in the major pharmaceutical markets
including the US, Canada, Europe, Japan, and Australia,
and that it was both expanding, and extending the life of,
its IP protection by filing patents applications on the use
of ATL1103 in combination with the marketed acromegaly
treatments Somavert and the somatostatin analogues. This
includes patent applications under examination in the US,
Europe, Japan, Canada, and Australia, which if granted would
provide protection to 2033/2034 and potentially extendible
up to a further 5 years.
On 18th May the Company reported that a manuscript
entitled “Antisense Oligonucleotide Therapy in Acromegaly:
A Randomized Phase II Study” had been submitted for
potential publication in a high-quality peer reviewed
scientific journal.
2 ANTISENSE THERAPEUTICS
ATL1102 for Multiple Sclerosis (MS)
ATL1102 is a second generation antisense inhibitor of
CD49d, the alpha subunit of VLA-4 (Very Late Antigen-4).
In inflammation, white blood cells (leukocytes) move out
of the bloodstream into the inflamed tissue, for example,
the Central Nervous System (CNS) in MS, and the lung
airways in asthma. In MS, the inhibition of VLA-4 prevents
white blood cells from entering the CNS, thereby reducing
the severity of the disease and slowing its progression.
VLA-4 is a clinically validated target in the treatment of
MS. Antisense inhibition of VLA-4 has demonstrated
positive effects in a number of animal models of
inflammatory disease including MS. ATL1102 was shown
to be highly effective in reducing MS lesions in a 77 patient
double-blind placebo controlled Phase IIa clinical trial in
MS patients. The Phase IIa clinical trial data on ATL1102
has been published in the medical Journal Neurology
(Limmroth et al, Neurology, 2014 Nov 11: 83(20: 1780-8).
The Company reported that it was looking to seek to add
value and move the ATL1102 for MS program forward by
preparing an Investigational New Drug (IND) submission
to the US Food and Drug Administration (FDA), while
pursuing other development opportunities including
progressing non-dilutive funding initiatives for the conduct
of the Phase IIb trial. The Company advised that the IND
application was for a Phase IIb trial in 195 MS patients.
The Company also advised that it was continuing its
planning to undertake a smaller investigative study of
ATL1102 in relapsing SP-MS patients in Germany with
Professor Volker Limmroth and that an application had
been submitted to the National Multiple Sclerosis Society
in the US for grant funding to conduct this study.
?
What is Acromegaly?
Acromegaly is a serious chronic life threatening disease
triggered by excess secretion of growth hormone
(GH) by benign pituitary tumours. Oversupply of GH
over stimulates liver, fat and kidney cells, through
their GH receptors, to produce excess levels of Insulin-
Like Growth Factor-I (IGF-I) in the blood manifesting
in abnormal growth of the face, hands and feet, and
enlargement of body organs including liver, kidney
and heart. The primary treatments for acromegaly
are to surgically remove the pituitary gland and/or
drug therapy to normalize GH and serum IGF-I levels.
In North America and Europe there are approximately
85,000 diagnosed acromegaly patients with about half
requiring drug therapy.
Progress
Events after balance date
On 24th April the Company reported that it had initiated
the process for submission of the ATL1102 for MS Phase
IIb IND application with documentation being provided
to its Regulatory Agent in the US who, on the Company’s
behalf, would submit the IND application to the FDA.
On 16th June the Company reported that a post hoc
analysis of brain lesion data from the Phase II study of
the ATL1102 in patients with MS [Limmroth et al 2014
Neurology] had shown that ATL1102 significantly reduces
the number of active MS lesions that convert to “Black
Holes”, areas of axonal (nerve fibre) loss or permanent
tissue damage. The positive effect of ATL1102 on black
holes suggest that along with its action in reducing the
number of inflammatory lesions, ATL1102 may also be
potentially neuroprotective in protecting the axons in
the lesion from degeneration. The post hoc analysis
was conducted by Dr Frederik Barkhof, Professor of
Neuroradiology, Department of Radiology and Nuclear
Medicine, VU University Medical Centre, Amsterdam, and
co-author on the Limmroth et al Neurology publication.
The Company said it had filed a provisional patent
application incorporating this new data while an abstract
of the results was to be submitted for presentation at an
MS scientific meeting this year.
On 26th June the Company advised that the ATL1102 for
MS Phase IIb IND application has been submitted to the
FDA for its review.
?
What is Multiple Sclerosis?
Multiple Sclerosis (MS) is a life-long, chronic disease
that progressively destroys the central nervous system
(CNS). It affects approximately 400,000 people in
North America and more than 1 million worldwide
and the current market for MS drugs is estimated at
more than USD$12 billion. It is a disease that affects
more women than men, with onset typically occurring
between 20 and 40 years of age. Symptoms of MS may
include vision problems, loss of balance, numbness,
difficulty walking and paralysis. In Australia MS affects
over 15,000 people and worldwide MS may affect more
than one million people.
On 27th July the Company advised that it had been in
recent communications with the FDA in regard to the
ATL1102 for MS Phase IIb IND application. The FDA told
ANP that modifications to the proposed clinical trial are
needed in order for FDA to clear the IND to proceed. In
a teleconference with ANP, FDA provided a high-level
description of the necessary modifications and will provide
actionable details in a formal written response. The
Company advised that during this period of clinical hold
ANP would formally submit updates to the IND soon after
receipt of FDA’s written response and the FDA has 30
calendar days to review and potentially clear the IND.
The Company also advised that in parallel, it was
progressing its grant application with a US Federal Agency,
the National Institute of Neurological Disorders and Stroke
(NINDS), part of the National Institutes for Health (NIH).
The Company said that it planned to modify the proposed
study design to align with both the FDA requirements
noted above and feedback on the trial received via NINDS
interactions. The next step would then be submission
to the NINDS Extramural Science Committee (ESC) for
review and potential approval to move forward to lodging
of the full grant application.
ATL1102 for Duchennes Muscular Dystrophy
(DMD)
On 26th June the Company reported that it was planning
to undertake a clinical trial of ATL1102 in patients
with Duchenne Muscular Dystrophy (DMD). The trial is
designed to assess the drug’s effects on the inflammation
associated with this rare and incurable muscle wasting
disease of children.
DMD is caused by a mutation in the muscle dystrophin
gene leading to severe progressive muscle loss and
premature death. One of the most common fatal
genetic disorders, DMD affects approximately one in
every 3,500 to 5,000 males worldwide. A key challenge
in the management of DMD patients is to reduce the
inflammation that exacerbates the muscle fibre damage.
Corticosteroids are the only approved treatments for
muscle inflammation, however they do not sufficiently
suppress muscle inflammation, are not well tolerated and
have serious side effects including adversely affecting
growth rate. As a consequence, there is an acknowledged
high need for new therapeutic approaches for the
treatment of inflammation associated with DMD.
ANNUAL REPORT 2017 3
Operations Report continued
The clinical trial of ATL1102 is planned to be undertaken
at the Royal Children’s Hospital in Melbourne, with the
clinical development of ATL1102 in boys with DMD to be
directed by an Advisory Board of international experts in
the field. The Company has clinical supplies available to
commence the trial pending receipt of relevant approvals
to commence the trial.
R&D Tax Incentive
During the year the Company received from the ATO
a payment of $395,597 in relation to R&D expenditure
incurred in the 30 June 2016 financial year.
Proposed Capital Raising
The Company has agreed to place 24,233,911 shares
at $0.032 per share to Australian Ethical Investment to
raise $775,485, equal to the maximum number of shares
that Antisense Therapeutics can issue within the 15%
placement capacity limit available under the Listing Rule
7.1. The issue of shares to Australian Ethical Investment is
conditional on the Company receiving hospital approval
any time before 30 September 2017 to commence the
clinical trial for ATL1102 in DMD.
Following the settlement of the placement to Australian
Ethical Investment, the Company proposes to undertake
a pro-rata Entitlement Issue to shareholders at the same
price to raise up to $2,000,000. Subject to approval to
commence the trial being granted, Australian Ethical
Investment indicated its intention to take up its pro-rata
entitlement and to acquire additional shortfall shares
in Antisense Therapeutics to increase its holding in the
Company to 19.99%.
Financial Position
At 30 June 2017, the Company had cash reserves of
$1,901,988 (2016: $4,800,718).
Events After The Balance Sheet Date
No matters or circumstances have arisen since the end
of the reporting period, not otherwise disclosed in this
report, which significantly affected, or may significantly
affect, the operations of the Company, the result of those
operations, or the state of affairs of the Company in
subsequent financial periods.
4 ANTISENSE THERAPEUTICS
?
What is Duchennes Muscular Dystrophy?
Duchenne Muscular Dystrophy (DMD) is an X-linked
disease that affects 1 in 3600 to 6000 live male
births (Bushby et al, 2010). DMD occurs as a result of
mutations in the dystrophin gene which causes a defect
in the protein or reduction or absence of the dystrophin
protein. Children with DMD have dystrophin deficient
muscles and are susceptible to contraction induced
injury to muscle which triggers the immune system
which exacerbates muscle damage (Pinto Mariz, 2015).
Ongoing deterioration in muscle strength affects lower
limbs leading to impaired mobility, and also affects
upper limbs, leading to further loss of function and self-
care ability. The need for wheelchair use can occur in
early teenage years, with respiratory, cardiac, cognitive
dysfunction also emerging. With no intervention,
the mean age of life is approximately 19 years. The
management of the inflammation associated with DMD
is currently via the use of corticosteroids, which have
insufficient efficacy and significant side effects.
Antisense Therapeutics currently has 9 patent families
with 70 patents registered or in the process of been
registered and 18 patent applications pending covering
its two antisense drugs ATL1102 and ATL1103 and their
applications. Antisense Therapeutics has also licensed
from Ionis Pharmaceuticals, 19 Ionis proprietary patents
and applications directed to the antisense drug platform
together with rights to 11 other Isis manufacturing patent
families.
Since reporting on the status of the Company’s
intellectual property portfolio in the 2016 Annual Report
the Company has expanded its patent portfolio as follows:
• A key European patent, 2 Japanese patents and a US
and Australian patent have been issued as follows:
• European 04715642.7 covering ATL1103 to GHr
has been granted and is in the process of been
registered in 10 European countries;
• US patent 9,717,778 and Australian patent
2013214698 covering ATL1103 and other antisense
to GHr used in combination with GHr antagonist
Somavert has been granted to 2033; and
• Japanese patents 2011-516297 and 2014-208153
covering ATL1102 in the treatment of relapsing and
active forms of multiple sclerosis with brain lesions
have been granted to 2029.
Intellectual Property Report
• The International application PCT/Au2016/051059 has
been filed to cover the use of ATL1102 in the treatment
of the leukaemia (AML) to 2036; and
• Australian provisional patent application 2017902314 has
been filed covering the use of ATL1102 in the reduction
of inflammatory brain lesions converting to black holes
for the treatment of multiple sclerosis to 2038;
• Australian provisional patent application 2017901380
has been filed covering the use of ATL1102 in the
treatment of Duchenne’s Muscular Dystrophy to 2038.
The progress outlined above has added significant value
to an already extensive intellectual property portfolio.
Key patents have been granted for the compounds in
Antisense Therapeutics’ product pipeline that underpin
Antisense Therapeutics commercialisation plans for its
antisense drugs.
In managing the costs associated with maintaining its IP
portfolio, the Company has abandoned the ATL1101 and
the ATL1102 inhaled asthma patents (not including the
US patent which is still registered until 2 July 2018 with
potential patent protection to 2028). The Company may
also progress the development of ATL1102 as an inhaled
asthma treatment relying on data or market exclusivity in
Europe, United States, Japan and Australia.
Country
Patent application or Patent No.
Current Status
Expiry
ATL1103 Patent Portfolio**
USA
USA
USA
7,803,781
8,299,039
8,637,484
Patent Registered
Patent Registered
Patent Registered
International
PCT/US2004/005896
National Phase applications
Australia
Canada
2,004,217,508
2,517,101
Europe
04715642.7
Patent Registered
Patent Registered
Regional Phase – granted
In the process of been
registered in the 10
European countries below
Europe
Denmark
Finland
France
Germany
Italy
Spain
11194098.7 Divisional of 04715642.7
Regional Phase - granted
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
2025*
2024*
2024*
2024*
2024
2024*
2024*
2024*
2024*
2024*
2024*
2024*
ANNUAL REPORT 2017 5
Intellectual Property Report continued
Country
Sweden
Switzerland
The Netherlands
United Kingdom
Japan
Japan
New Zealand
USA
USA
USA
USA
Patent application or Patent No.
Current Status
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
4837555
2014-042448 Divisional of 2006-
508878
542,595
7,846,906
8,623,836
9,371,530
15/186282 Continuation filed
Under Examination
ATL1103 Combination Patents
International
PCT/AU2013/000095
National Phase Applications
Australian
Canada
Europe***
Japan
New Zealand
USA
USA
International
Australian
Canada
Europe***
Japan
New Zealand
USA
ATL1102 Patent Portfolio**
USA
USA
2,013,214,698
2,863,499
13743020.3
2014-555044
629,004
14/376390
15/007,0011 Divisional
PCT/AU2014/000613
2014280847
2,918,787
14810926.7
2016-518801
715,825
14/897896
US 5968 826
US 6258 790
Patent Registered
Under Examination
Under Examination
Under Examination
Patent Registered
Patent Registered
Patent Allowed
International Phase
Filed
Filed
Under Examination
Under Examination
Filed
Filed
Expiry
2024*
2024*
2024*
2024*
2024*
2024*
2024
2024*
2024*
2024*
2024*
2033
2033
2033
2033
2033
2033
2033
2034
2034
2034
2034
2034
2034
Patent Registered
Patent Registered
2018**
2018*/**
International
PCT/US99/18796
National Phase applications
Australia
Canada
Japan
Japan
Europe
Denmark
Finland
France
AU 759938
2,345,209
2000-574727
2006-000258
EP1123414
DK/EP1123414
EP(FI)1123414
EP(FR)1123414
6 ANTISENSE THERAPEUTICS
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Regional Phase - granted
Patent Registered
Patent Registered
Patent Registered
2019*
2019
2019*
2019*
2019*
2019*
2019*
Country
Germany
Italy
Spain
Sweden
United Kingdom
Patent application or Patent No.
Current Status
DE69934998.2-08
IT40051BE2007
ES2279632
SE99942290.0
EP(UK)1123414
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
ATL1102 MS Patent Portfolio
International
PCT/US2009/003760
National Phase applications
Australia
Canada
Europe***
Denmark
Finland
France
Germany
Italy
Spain
Sweden
Switzerland
The Netherlands
United Kingdom
Europe***
Japan
Japan
USA
USA
Provisional
Australia
Canada
USA
AU 2009271678
2,728,562
09798248.2
Patent Registered
Under Examination
Regional Phase - granted
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Under Examination
Patent Registered
Divisional of 09798248.2
2011-516297
2014-208153 (Divisional of 2011-5516297)
Patent Registered
8,415,314
8,759,314
2017902314
2011301712
2,811,228
Patent Registered
Patent Registered
Filed
Patent Registered
Under Examination
ATL1102 Methods of reducing circulating leukocytes
15/046352 (Continuation of 13/823101) Under Examination
ATL1102 Therapeutic uses and methods (for treating Muscular Dystrophy)
Provisional
2,017,901,380
ATL1102 Methods of mobilizing leukaemia cells (for treating AML)
PCT
AU 2016/051059
Filed
Filed
* Potential for up to 5 year extensions to the patent term once the product is a registered drug.
** ATL1101, ATL1102, ATL1103 are also protected internationally by other Isis proprietary antisense technology patents
and applications to which Antisense Therapeutics has world-wide license including US7015315 to 2023.
*** Designates all member states of European patent countries including all extension states.
ANNUAL REPORT 2017 7
Expiry
2019*
2019*
2019*
2019*
2019*
2029*
2029
2029*
2029*
2029*
2029*
2029*
2029*
2029*
2029*
2029*
2029*
2029*
2029*
2029*
2029*
2029*
2038
2031*
2031*
2031*
2038
2036*
Directors' Report
Directors
The Board of Directors of Antisense Therapeutics Limited present their report on the consolidated entity (referred to
hereafter as ‘the Company’) consisting of Antisense Therapeutics Limited and the entities it controlled at the end of, or
during, the Year Ended 30 June 2017. In order to comply with the provisions of the Corporations Act 2001, the Board of
Directors report as follows:
Mr. Robert W Moses
Independent Non-Executive Chairman
BA, MBA, FAICD, FAIM
Qualifications:
Appointed to the Board:
23 October 2001
Last elected by shareholders: 1 November 2013
Experience:
Robert (Bob) Moses was formerly Corporate Vice President of CSL Limited. Mr. Moses draws on more than 40 years’
experience in the pharmaceutical/biotechnology industry. During the period 1993-2001, Mr. Moses played a central role
in CSL's development internationally. Prior to joining CSL, Mr. Moses was Managing Director of commercial law firm
Freehills, Chairman and CEO of a NASDAQ listed medical service company, and Corporate Manager of New Business
Development at ICI (now Orica). Mr. Moses is also the former Non-Executive Chairman of TGR Biosciences Pty Ltd. Mr.
Moses also spent 17 years in various management roles at the multinational pharmaceutical company Eli Lilly.
Interest in shares & options: 5,000,000 ordinary shares and 1,418,888 options over ordinary shares.
Committees: Chairman of the Remuneration Committee and member of the Audit Committee.
Directorships held in other listed entities: Nil
Mr. Mark Diamond
Managing Director
Qualifications:
Appointed to the Board:
BSc, MBA
31 October 2001
Experience:
Mark Diamond has over 30 years’ experience in the pharmaceutical and biotechnology industry. Before joining
Antisense Therapeutics Limited as MD and CEO in 2001, Mr. Diamond was employed in the US as Director, Project
Planning/Business Development at Faulding Pharmaceuticals. Prior to this he held the positions of Senior Manager,
Business Development and In-licensing within Faulding's European operation based in the UK and International
Business Development Manager with Faulding in Australia.
Interest in shares & options: 1,721,072 ordinary shares and 642,772 options over ordinary shares.
Committees: Nil
Directorships held in other listed entities: Nil
8 ANTISENSE THERAPEUTICS
Dr Graham Mitchell
Independent Non-Executive Director
AO, RDA, BVSc, FACVSc, PhD, FTSE, FAA
Qualifications:
Appointed to the Board:
24 October 2001
Last elected by shareholders: 6 November 2014
Experience:
Graham Mitchell through Foursight Associates Pty Ltd ("Foursight"), acts as joint Chief Scientist for the Victorian
Government Department of Environment and Primary Industries. Dr. Mitchell is a Non-Executive Director of Avipep Pty
Ltd and is a Principal of Foursight. Dr. Mitchell has held the position of Director of Research in the R&D Division of CSL
Limited and for many years was a research scientist at The Walter & Eliza Hall Institute (WEHI). He is currently a Board
Member of WEHI.
Interest in shares & options: 264,180 ordinary shares and 48,036 options over ordinary shares.
Committees: Member of the Remuneration Committee and Chairman of the Audit Committee.
Directorships held in other listed entities: Nil
Dr Gary Pace
Independent Non-Executive Director
Qualifications:
Appointed to the Board:
BSc, PhD
9 November 2015
Experience:
Dr Pace has more than 40 years of experience in the development and commercialization of advanced technologies
in biotechnology, pharmaceuticals, medical devices and the food industries. He has long-term board level experience
with both multi-billion and small cap companies. In 2003 Dr Pace was awarded a Centenary Medal by the Australian
Government “for service to Australian society in research and development”, and in 2011 was awarded Director of the
Year (corporate governance) by the San Diego Directors Forum. In addition he has held visiting academic positions at the
Massachusetts Institute of Technology and the University of Queensland. Dr Pace is an elected Fellow of the Australian
Academy of Technological Sciences and Engineering.
Interest in shares & options: 618,069 ordinary shares.
Committees: Nil
Directorships held in other listed entities:
Dr Pace is currently a director of ResMed, Pacira Pharmaceuticals Inc. and formerly late 2015 Transition Therapeutics Inc.
and Simavita Limited.
Mr William Goolsbee
Independent Non-Executive Director
Qualifications:
Appointed to the Board:
BA
15 October 2015
Experience:
Mr. Goolsbee was founder, Chairman and Chief Executive Officer of Horizon Medical Inc. from 1987 until its acquisition
by a unit of UBS Private Equity in 2002. Mr. Goolsbee was a founding Director of ImmunoTherapy Corporation in 1993,
and became Chairman in 1995, a position he held until overseeing the successful acquisition of ImmunoTherapy by AVI
Biopharma, Inc. (now Sarepta Therapeutics) in 1998. Mr. Goolsbee served as Chairman of privately held BMG Pharma LLC,
a pharmaceutical company, from 2006 through 2011 and of Metrodora Therapeutics until 2015.
Interest in shares & options: 422,000 ordinary shares and 84,400 options over ordinary shares.
Committees: Nil
Directorships held in other listed entities: Mr Goolsbee was until the end of 2016 a Director of Sarepta Therapeutics Inc.
ANNUAL REPORT 2017 9
Directors' Report continued
Mr Phillip Hains
Company Secretary and Chief Financial Officer
Appointed to the Board:
9 November 2006
Experience:
Phillip Hains is a Chartered Accountant operating a specialist public practice, 'The CFO Solution'. The CFO Solution focuses
on providing back office support, financial reporting and compliance systems for listed public companies. A specialist in the
public company environment, Mr Hains has served the needs of a number of company boards and their related committees.
He has over 30 years' experience in providing businesses with accounting, administration, compliance and general
management services.
Principal Activities
Risk Management
The principal activity of Antisense Therapeutics
Limited during the financial year was the research and
development of novel antisense pharmaceuticals.
Dividends
No dividends have been paid or declared since the
end of the previous financial year, nor do the Directors
recommend the declaration of a dividend.
The Board is responsible for overseeing the establishment
and implementation of the risk management system, and
to review and assess the effectiveness of the Company's
implementation of that system on a regular basis.
The Board and senior management will continue to
identify the general areas of risk and their impact on the
activities of the Company. The potential risk areas for the
Company include:
• efficacy, safety and regulatory risk of pre-clinical and
Significant Changes in the State of Affairs
clinical pharmaceutical development;
There have been no significant changes in the state of
affairs of the Company during the year.
• financial position of the Company and the financial
outlook;
Significant Events After the Balance Date
There have been no significant events occurring after
the balance date which may affect either the Company's
operations or results of those operations or the
Company's state of affairs.
Likely Developments and Expected Results
The likely developments in the Company's operations, to
the extent that such matters can be commented upon, are
covered in the 'Operations Report’.
Operating and Financial Review
The net loss after tax of the Company for Year Ended
30 June 2017 was $2,754,799 (2016 loss : $2,514,443)
This result has been achieved after fully expensing all
research and development costs.
The Company had a cash reserve of $1,901,988 at 30
June 2017.
The 'Operations Report' provides further details
regarding the progress made by the Company since
the prior financial period, which have contributed to its
results for the year.
• economic outlook and share market activity;
• changing government policy (Australian and overseas);
• competitors' products/research and development
programs;
• market demand and market prices for therapeutics;
• environmental regulations;
• ethical issues relating to pharmaceutical research and
development;
• the status of partnership and contractor relationships;
• other government regulations including those specifically
relating to the biotechnology and health industries; and
• occupational health and safety and equal opportunity law.
Management will continue to perform a regular review of
the following:
• the major risks that occur within the business;
• the degree of risk involved;
• the current approach to managing the risk; and
• where appropriate, determine:
• any inadequacies of the current approach; and
• possible new approaches that more efficiently and
effectively address the risk.
10 ANTISENSE THERAPEUTICS
Regulatory Approvals
Complex government health regulations, which are
subject to change, add uncertainty to obtaining approval
to undertake clinical development and obtain marketing
approval for pharmaceutical products.
Delays may be experienced in obtaining such approvals, or
the regulatory authorities may require repeat of different
or expanded animal safety studies or human clinical
trials, and these may add to the development cost and
delay products from moving into the next phase of drug
development and up to the point of entering the market
place. This may adversely affect the competitive position
of products and the financial value of the drug candidates
to the Company.
There can be no assurance that regulatory clearance will
be obtained for a product or that the data obtained from
clinical trials will not be subject to varying interpretations.
There can be no assurance that the regulatory authorities
will agree with the Company's assessment of future clinical
trial results.
Competition
The Company will always remain subject to the material
risk arising from the intense competition that exists in the
pharmaceutical industry. A material risk therefore exists
that one or more competitive products may be in human
clinical development now or may enter into human clinical
development in the future. Competitive products focusing
on or directed at the same diseases or protein targets as
those that the Company is working on may be developed
by pharmaceutical companies or other antisense drug
companies including Ionis or any of its other collaboration
partners or licensees. Such products could prove more
efficacious, safer, more cost effective or more acceptable
to patients than the Company product. It is possible that
a competitor may be in that market place sooner than the
Company and establish itself as the preferred product.
Biotechnology Companies
– Inherent Risks
Pharmaceutical Research and Development
(R&D)
Pharmaceutical R&D involves scientific uncertainty and
long lead times. Risks inherent in these activities include
uncertainty of the outcome of the Company's research
results; difficulties or delays in development of any of the
Company's drug candidates; and general uncertainty related
to the scientific development of a new medical therapy.
The Company's drug compounds require significant
pre-clinical and human clinical development prior to
commercialisation, which is uncertain, expensive and
time consuming. There may be adverse side effects or
inadequate therapeutic efficacy of the Company's drug
candidates which would prevent further commercialisation.
There may be difficulties or delays in testing any of the
Company's drug candidates. There may also be adverse
outcomes with the broader clinical application of the
antisense technology platform which could have a negative
impact on the Company's specific drug development and
commercialisation plans.
No assurance can be given that the Company's product
development efforts will be successful, that any potential
product will be safe and efficacious, that required
regulatory approvals will be obtained, that the Company's
products will be capable of being produced in commercial
quantities at an acceptable cost or at all, that the Company
will have access to sufficient capital to successfully advance
the products through development or to find suitable
development or commercial partners for the development
and or commercialisation of the products and that any
products, if introduced, will achieve market acceptance.
Partnering and licensing
Due to the significant costs in drug discovery and
development it is common for biotechnology companies
to partner with larger biotechnology or pharmaceutical
companies to help progress drug development. While
the Company has previously entered into such licensing
agreements with pharmaceutical partners, there is no
guarantee that the Company will be able to maintain such
partnerships or license its products in the future. There
is also no guarantee that the Company will receive back
all the data generated by or related intellectual property
from its licensing partners. In the event that the Company
does license or partner the drugs in its pipeline, there is
no assurance as to the attractiveness of the commercial
terms nor any guarantee that the agreements will generate
a material commercial return for the Company.
ANNUAL REPORT 2017 11
Directors' Report continued
Biotechnology Companies – Inherent
Risks continued
Technology and Intellectual Property Rights
Securing rights to technology and patents is an integral
part of securing potential product value in the outcomes
of pharmaceutical R&D. The Company's success depends,
in part, on its ability to obtain patents, maintain trade
secret protection and operate without infringing the
proprietary rights of third parties. There can be no
assurance that any patents which the Company may own,
access or control will afford the Company commercially
significant protection of its technology or its products
or have commercial application, or that access to these
patents will mean that the Company will be free to
commercialise its drug candidates. The granting of a
patent does not guarantee that the rights of others are not
infringed or that competitors will not develop technology
or products to avoid the Company's patented technology
or try to invalidate the Company’s patents, or that it will
be commercially viable for the Company to defend against
such potential actions of competitors.
Environmental Regulation and Performance
The Company is involved in pharmaceutical research
and development, much of which is contracted out to
third parties, and it is the Director’s understanding that
these activities do not create any significant/material
environmental impact. To the best of the Company's
knowledge, the scientific research activities undertaken by,
or on behalf of, the Company are in full compliance with all
prescribed environmental regulations.
Directors' Meetings
The number of meetings of Directors (including meetings
of committees of Directors) held during the year and the
number of meetings attended by each Director were as
follows:
Board Meetings
Meetings of committees
Audit
Remuneration
No. eligible to
attend
No. attended
No. eligible to
attend
No. attended
No. eligible to
attend
No. attended
Robert W Moses
Mr Mark Diamond
Dr Graham Mitchell
Dr Gary Pace
Mr William Goolsbee
8
8
8
8
8
Committee Membership
8
8
8
8
7
2
2
2
2
2
2
2
2
2
2
-
-
-
-
-
-
-
-
-
-
As at the date of this report the Company had an Audit Committee and Remuneration Committee, with membership of
the committees as follows:
Audit Committee
Remuneration Committee
Chairman
Dr Graham Mitchell
Members
Mr Robert W Moses
Mr Robert W Moses
Dr Graham Mitchell
12 ANTISENSE THERAPEUTICS
Indemnification and Insurance of Directors and
Officers
Under the Company’s constitution:
(a) To the extent permitted by law and subject to
the restrictions in section 199A and 199B of the
Corporations Act 2001, the Company indemnifies
every person who is or has been an officer of the
Company against any liability (other than for legal
costs) incurred by that person as an officer of the
Company where the Company requested the officer to
accept appointment as Director.
(b) To the extent permitted by law and subject to
the restrictions in sections 199A and 199B of the
Corporations Act 2001, the Company indemnifies
every person who is or has been an officer of the
Company against reasonable legal costs incurred in
defending an action for a liability incurred by that
person as an officer of the Company.
The Company has insured its Directors, the Company
Secretaries and executive officers for the financial year
ended 30 June 2016. Under the Company's Directors' and
Officers' Liability Insurance Policy, the Company cannot
release to any third party or otherwise publish details of
the nature of the liabilities insured by the policy or the
amount of the premium. Accordingly, the Company relies
on section 300(9) of the Corporations Act 2001 to exempt
it from the requirement to disclose the nature of the
liability insured against and the premium amount of the
relevant policy.
The Company also has in place a Deed of Indemnity, Access
and Insurance with each of the Directors. This Deed:
(1) indemnifies the Director to the extent permitted by
law and the Constitution against certain liabilities and
legal costs incurred by the Director as an officer of any
Group Company;
(2) requires the Company to maintain, and pay the
premium for, a D&O Policy in respect of the Director;
and
Indemnification of Auditors - Ernst and Young
To the extent permitted by law, the Company has agreed
to indemnify its auditors, Ernst and 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
and Young during or since the financial year.
Proceedings on Behalf of the Company
No person has applied to the Court under section
237 of the Corporations Act 2001 for leave to bring
proceedings on behalf of the Company, or to intervene in
any proceedings to which the Company is a party, for the
purpose of taking responsibility on behalf of the Company
for all or part of those proceedings.
No proceedings have been brought or intervened in on
behalf of the Company with leave of the Court under
section 237 of the Corporations Act 2001.
Share Options on Issue as at the Date of the
Report
UNISSUED SHARES
The unissued ordinary shares of Antisense Therapeutics
Limited under option as at the date of this report were:
Class
Date of Expiry
Exercise
Price
No. Under
Option
ANPOB
19 December 2019
$0.008
68,713,794
Auditor Independence and Non-Audit Services
AUDITOR’S INDEPENDENCE DECLARATION
The Auditors Independence Declaration as required under
section 307C of the Corporations Act 2001 for the year
ended 30 June 2017 has been received and can be found
in the ‘Auditor’s Independence Declaration’ section of this
Annual Report.
(3) provides the Director with access to particular papers
Non-Audit Services
and documents requested by the Director for a
Permitted Purpose,
both during the time that the Director holds office and
for a seven year period after the Director ceases to be an
officer of any Group Company, on the terms and conditions
contained in the Deed.
The following non-audit services were provided by
the entity's auditor, Ernst and Young. The Directors
are satisfied that the provision of non-audit services is
compatible with the general standard of independence
for auditors imposed by the Corporations Act 2001.
The nature and scope of each type of non-audit service
provided means that auditor independence was not
compromised.
ANNUAL REPORT 2017 13
Directors' Report continued
Ernst and Young received or are due to receive the
following amounts for the provision of non-audit services:
Rounding off
Tax compliance services
2017
$
19,250
19,250
2016
$
19,250
19,250
The Company is of a kind referred to in ASIC Corporations
(Rounding in Financial/Directors’ Reports) Instrument
2016/191 and in accordance with that Instrument, amounts
in the consolidated financial statements and directors’
report have been rounded off to the nearest dollar, unless
otherwise stated.
Remuneration Report (Audited)
1. Remuneration Report Overview
This Remuneration Report outlines the Director and
Executive remuneration arrangements of the Company as
required by the Corporations Act 2001 and its Regulations.
This report details the nature and amount of remuneration
of each Director of Antisense Therapeutics Limited and all
other Key Management Personnel.
For the purposes of this report, Key Management
Personnel (KMP) are defined as those persons 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) of the Company.
2. Principles Used to Determine the Nature
and Amount of Remuneration
A. Remuneration Policy
The Remuneration Policy ensures that Directors and
Senior Management are appropriately remunerated having
regard to their relevant experience, their performance, the
performance of the Company, industry norms/standards
and the general pay environment as appropriate. The
Remuneration Policy has been established to enable the
Company to attract, motivate and retain suitably qualified
Directors and Senior Management who will create value
for shareholders.
B. Remuneration Policy versus Company
Performance
This report details the nature and amount of remuneration
for each Director of Antisense Therapeutics Limited, and
for the other Key Management Personnel.
The Company's Remuneration Policy is not directly based
on the Company's earnings. Prior to the year ended 30
June 2017, the Company's earnings had remained negative
since inception due to the nature of the Company.
Name
Directors:
Position
Mr Robert W Moses
Independent Non-Executive
Chairman
Mr Mark Diamond
Managing Director
Dr Graham Mitchell
Independent Non-Executive
Director
Mr William Goolsbee Independent Non-Executive
Director
Dr Gary Pace
Independent Non-Executive
Director
Other key management personnel:
Dr George Tachas
Mr Phillip Hains
Director, Drug Discovery &
Patents
Company Secretary and Chief
Financial Officer
Shareholder wealth reflects this speculative and volatile
market sector. No dividends have ever been declared by
the Company.
The Company continues to focus on the research and
development of its intellectual property portfolio with the
objective of achieving key development and commercial
milestones in order to add further Shareholder value.
The Company’s performance over the previous five
financial years is as follows:
Net loss financial year 2017
Net profit financial year 2016
Net loss financial year 2015
Net loss financial year 2014
Net loss financial year 2013
$2,754,799
$2,514,443
$706,918
$3,013,272
$2,454,842
14 ANTISENSE THERAPEUTICS
The Company’s share price over the previous five financial
years is as follows:
30 June 2017
30 June 2016
30 June 2015
30 June 2014
30 June 2013
$0.033
$0.031
$0.12
$0.14
$0.10
C. The Remuneration Committee
The Remuneration Committee of the Board of Directors
of Antisense Therapeutics Limited is responsible for
overseeing the Remuneration Policy of the Company and
for recommending or making such changes to the policy as
it deems appropriate.
D. Non-Executive Director Remuneration
OBJECTIVE
The Remuneration Policy ensures that Non-Executive
Directors are appropriately remunerated having regard
to their relevant experience, individual performance, the
performance of the Company, industry norms/standards
and the general pay environment as appropriate.
STRUCTURE
The Company's Constitution and the ASX Listing Rules
specify that the aggregate remuneration of Non-Executive
Directors shall be determined from time to time by a
General Meeting. An amount (not exceeding the amount
approved at the General Meeting) is determined by the
Board and then divided between the Non-Executive
Directors as agreed. The latest determination was at
the General Meeting held on 13 November 2001 when
shareholders approved the aggregate maximum sum to
be paid or provided as remuneration to the Directors as a
whole (other than the Managing Director and Executive
Directors) for their services as $300,000 per annum.
In the year ended 30 June 2017, the Non-Executive
Directors were remunerated in aggregate $157,209 per
annum, excluding superannuation.
The manner in which the aggregate remuneration
is apportioned amongst Non-Executive Directors is
reviewed periodically.
The Board is responsible for reviewing its own
performance. Board, and Board committee performance, is
monitored on an informal basis throughout the year with a
formal review conducted during the financial year.
No retirement benefits are payable other than statutory
superannuation, if applicable.
E. Executive Director and Executive Officer
Remuneration
OBJECTIVE
The Remuneration Policy ensures that Executive
Directors are appropriately remunerated having regard
to their relevant experience, individual performance, the
performance of the Company, industry norms/standards
and the general pay environment as appropriate.
STRUCTURE
The Non-Executive Directors are responsible for
evaluating the performance of the Managing Director,
who in turn evaluates the performance of the other
Senior Executives. The evaluation process is intended to
assess the Company's business performance, whether
long-term strategic objectives are being achieved and
the achievement of individual performance objectives.
The performance of the Managing Director and
Senior Executives are monitored on an informal
basis throughout the year and a formal evaluation is
performed annually.
FIXED REMUNERATION
Executives' fixed remuneration comprises salary and
superannuation and is reviewed annually by the Managing
Director, and in turn, the Remuneration Committee. This
review takes into account the Executives' experience,
performance in achieving agreed objectives and market
factors as appropriate.
VARIABLE REMUNERATION
- SHORT TERM INCENTIVE SCHEME
All Executives are entitled to participate in the Employee
Short Term Incentive Scheme which provides for annual
cash bonuses for outstanding performance in the
achievement of key corporate and individual objectives.
The Remuneration Committee approves the issue of cash
bonuses following the recommendations of the Managing
Director in his review of the performance of the Executives
and the Company as a whole.
ANNUAL REPORT 2017 15
Directors' Report continued
Remuneration Report (Audited)
continued
VARIABLE REMUNERATION
- SHORT TERM INCENTIVE SCHEME continued
The Short Term Incentive Scheme operates as follows:
The Board determines whether Executives are eligible
for bonuses on an annual basis. The cash bonuses, based
on the recommendations of the Managing Director for
outstanding performance, are not linked to any specific
Key Result Areas (KRA’s). The maximum achievable
bonus for an Executive is 35% of the Executive's base
salary. There were no bonuses paid under the Short Term
Incentive Scheme during the year.
3. Details of Remuneration
A. Details of Remuneration
VARIABLE REMUNERATION – LONG TERM INCENTIVE
SCHEME
Executives may also be provided with longer-term incentives
through the Company's Employee Option Plan, to allow the
Executives to participate in and benefit from the growth
of the Company as a result of their efforts and to assist in
motivating and retaining those key employees over the long
term. Continued service is the condition attached to the
vesting of the options. The Board at its discretion determines
the total number of options granted to each Executive. There
were no options granted under the Long Term Incentive
Scheme during the year.
The remuneration for each Director and each of the other Key Management Personnel of the Company during the Year
Ended 30 June 2017 was as follows:
30 June 2017
Directors
Mr Robert W Moses
Mr Mark Diamond
Dr Graham Mitchell
Mr William Goolsbee
Dr Gary Pace
Other Key Management Personnel
Dr George Tachas
Mr Phillip Hains (1)
Short-term employee
benefits
Post-employment
Benefits
Long-term
Benefits
Cash salary & fees
Pension & Super
Contribution
Long Service
Leave
$
$
Total
$
61,641
$
-
6,991
395,866
-
-
-
39,968
50,458
50,458
5,348
22,875
3,468
-
-
31,691
6,991
598,391
17,471
-
17,471
49,162
4,206
241,862
-
99,000
4,206
340,862
11,197
939,253
56,293
366,000
36,500
50,458
50,458
559,709
220,185
99,000
319,185
878,894
(1) Remunerated through The CFO Solution (see Section 5 below and the Company Secretary details above for further detail)
16 ANTISENSE THERAPEUTICS
The remuneration for each Director and each of the other Key Management Personnel of the Company during the Year
Ended 30 June 2016 was as follows:
30 June 2016
Short-term employee
benefits
Post-employment
Benefits
Long-term
Benefits
Cash salary & fees
$
Pension & Super
Contribution $
Long Service
Leave $
Total $
Directors
Mr Robert W Moses
Mr Mark Diamond
Dr Chris Belyea (1)
Dr Graham Mitchell
Mr William Goolsbee
Dr Gary Pace
Other Key Management Personnel
Dr George Tachas
Mr Phillip Hains (2)
56,293
366,000
18,750
36,500
48,336
43,631
569,510
220,185
99,000
319,185
888,695
5,348
27,450
1,781
3,468
-
-
-
61,641
6,966
400,416
-
-
-
-
20,531
39,968
48,336
43,631
38,047
6,966
614,523
21,180
-
21,180
59,227
4,191
-
4,191
11,157
245,556
99,000
344,556
959,079
(1) Dr Chris Belyea resigned from the Board of Directors on 12 November 2015.
(2) Remunerated through The CFO Solution (see Section 5 below and the Company Secretary details above for further detail).
4. Share-Based Compensation
Shareholdings
The number of shares in the Company held during the financial year by each Director and other Key Management
Personnel of the Company, including their personally related parties, are set out below.
No shares were granted to Directors and Key Management Personal during the period as compensation.
30 June 2017
Directors
Balance at
start of the
year
Granted
as Com-
pensation
Options
Exercised
Net
Change
Other
Total
Balance held nominally
at the end of the
reporting period
Mr Robert W Moses
3,354,434
Mr Mark Diamond
Dr Graham Mitchell
Mr William Goolsbee
Dr Gary Pace
1,457,914
240,180
-
-
5,052,528
Other Key Management Personnel
Dr George Tachas
Mr Phillip Hains (1)
659,237
4,253,928
4,913,165
9,965,693
-
-
-
-
-
-
-
-
-
-
-
-
1,645,566
5,000,000
263,158
1,721,072
24,000
-
264,180
-
-
422,000
422,000
618,069
618,069
24,000
2,948,793
8,025,321
-
-
-
109,795
769,032
73,882
4,327,810
183,677
5,096,842
24,000
3,132,470
13,122,163
-
-
-
-
-
-
-
-
-
-
(1) Remunerated through The CFO Solution (see Section 5 below and the Company Secretary details above for further detail).
ANNUAL REPORT 2017 17
Directors' Report continued
Remuneration Report (Audited) continued
4. Share-Based Compensation continued
Options and Rights
The number of options over ordinary shares in the Company held during the financial year by each Director of Antisense
Therapeutics Limited and other Key Management Personnel of the Company, including their personally related parties, are
set out below:
30 June 2017
Balance
at start of
the year
Granted
as Com-
pensation
Options
Exercised
Net
Change
Other
Total
vested at
end of the
year
Total
vested and
exercisable at
the end of the
year
Balance held
nominally at
the end of
the reporting
period
Directors
Mr Robert W Moses
708,001
Mr Mark Diamond
Dr Graham Mitchell
Mr William Goolsbee
Dr Gary Pace
351,189
60,582
-
-
1,119,772
Other Key Management Personnel
Dr George Tachas
Mr Phillip Hains (1)
159,276
77,684
236,960
1,356,732
-
-
-
-
-
-
-
-
-
-
-
-
710,887
1,418,888
1,418,888
291,583
642,772
(24,000)
11,454
48,036
-
-
84,400
84,400
-
-
642,772
48,036
84,400
-
(24,000)
1,098,324 2,194,096
2,194,096
-
-
-
(5,468)
153,808
850,787
928,471
153,808
928,471
845,319
1,082,279
1,082,279
(24,000)
1,943,643
3,276,375
3,276,375
-
-
-
-
-
-
-
-
-
-
(1) Remunerated through The CFO Solution (see Section 5 below and the Company Secretary details above for further detail).
5. Employment Contracts of Key Management Personnel
At the date of this report, the employment conditions of the Managing Director, Mr Mark Diamond and other Key
Management Personnel were formalised in contracts of employment. Mr Mark Diamond is employed under a contract,
which commenced on 31 October 2001. Subsequent to this contract a notice period for Mr Diamond of between two and
four months was negotiated depending upon the party ending the agreement.
Antisense Therapeutics Limited has a contract with The CFO Solution, a specialist public practice, focusing on providing
back office support, financial reporting and compliance systems for listed public companies. Through this contract the
services of Mr Phillip Hains were provided. The contract commenced on 9 November 2006 and can be terminated with
three months’ notice of either party.
6. Additional Information
(a) Equity issued as part of remuneration for the year ended 30 June 2017
During the financial year ended 30 June 2017, 24,000 options have been exercised. No options were granted or lapsed
by any of the Key Management Personnel.
18 ANTISENSE THERAPEUTICS
(b) Loans to Directors and Other Key Management Personnel
There were no loans made to Directors or other Key Management Personnel of the Company, including their personally
related parties.
(c) Other transactions with Other Key Management Personnel
Transactions between Key Management Personnel are on normal commercial terms and conditions no more favourable
than those available to other parties unless otherwise stated.
Signed in accordance with a resolution of the Directors.
Mr Robert W Moses
Independent Non-Executive Chairman
Mr Mark Diamond
Managing Director and Chief Executive Officer
Dated: This day 29th day of August 2017
ANNUAL REPORT 2017 19
Auditor’s Independence Declaration
Ernst & Young
8 Exhibition Street
Melbourne VIC 3000 Australia
GPO Box 67 Melbourne VIC 3001
Tel: +61 3 9288 8000
Fax: +61 3 8650 7777
ey.com
Auditor’s Independence Declaration to the Directors of Antisense
Therapeutics Limited
As lead auditor for the audit of Antisense Therapeutics Limited for the financial year ended 30 June 2017,
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.
This declaration is in respect of Antisense Therapeutics Limited and the entities it controlled during the
financial year.
Ernst & Young
Joanne Lonergan
Partner
Melbourne
29 August 2017
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
20 ANTISENSE THERAPEUTICS
Corporate Governance
The Board of Directors of Antisense Therapeutics Limited
("the Company") is responsible for the corporate governance
of the Company and guides and monitors the business and
affairs of the Company on behalf of its shareholders.
Principle 1:
Lay solid foundations for management and
oversight
The format of the Corporate Governance Statement
is based on the Australian Stock Exchange Corporate
Governance Council's ("the Council") "Corporate
Governance Principles and Recommendations". In
accordance with the Council's recommendations, the
Corporate Governance Statement must contain certain
specific information and must disclose the extent to which
the Company has followed the guidelines during the period.
Where a recommendation has not been followed, that
fact must be disclosed, together will the reasons for
the departure. The Company’s Corporate Governance
Statement is structured with reference to the Council's
principles and recommendations, which are as follows:
Principle 1. Lay solid foundations for management and
oversight
Principle 2. Structure the board to add value
Principle 3. Act ethically and responsibly
Principle 4. Safeguard integrity in corporate reporting
Principle 5. Make timely and balanced disclosure
Principle 6. Respect the rights of shareholders
Principle 7. Recognise and manage risk
Principle 8. Remunerate fairly and responsibly
Commensurate with the spirit of the ASX Corporate
Governance Principles and Recommendations, the
Company has followed each recommendation where
the Board has considered the recommendation to be
an appropriate benchmark for corporate governance
practices, taking into account factors such as the size
of the Company and the Board, resources available and
activities of the Company. Where the Company's corporate
governance practices depart from the Principles and
Recommendations, the Board has offered full disclosure
of the nature of, and reason for, the adoption of its own
practice.
The Company’s corporate governance practices were in
place throughout the year ended 30 June 2017. For further
information on the corporate governance policies adopted
by the Company, please refer to its website:
www.antisense.com.au
Role of the Board
It is the role of the Board of Directors to represent and
protect the interests of the Company's shareholders. The
Board is responsible for the corporate governance of the
Company and guides and monitors the business and affairs
of the Company.
In furtherance of its responsibilities, the Board of
Directors will:
• review, evaluate, provide input into and approve, on
a regular basis, the Company's corporate governance
strategy;
• monitor senior management's performance and
implementation of strategy, and ensure appropriate
resources are available;
• review, evaluate and approve the Company's budget
and forecasts;
• review, evaluate, approve and monitor major
resource allocations and capital investments, and any
acquisitions and divestitures;
• review and monitor the financial and operating results
of the Company;
• review and evaluate the overall corporate
organisational structure, the assignment of senior
management responsibilities and plans for senior
management development and succession;
• review, evaluate and approve compensation strategy as
it relates to senior management of the Company;
• review and ratify systems of risk management and
internal compliance and control, codes of conduct, and
legal compliance;
• appoint and remove the Managing Director (Chief
Executive Officer);
• ratify the appointment and, where appropriate, the
removal of the Chief Financial Officer and the Company
Secretary;
• monitor its own performance and recommend and
implement appropriate changes in composition and size.
ANNUAL REPORT 2017 21
Corporate Governance continued
Principle 1:
Lay solid foundations for management and
oversight continued
Role of Management
Through the Chief Executive Officer / Managing Director,
management is responsible to the Board for the:
(1) Development and implementation of agreed
corporate strategy and performance objectives;
(2) Undertaking the day to day activities of the Company;
(3) Identifying all matters to be included in a risk profile
of the Company and ensuring that effective risk
management systems are implemented and adhered
to;
(4) Observing the code of conduct;
(5) Ensuring that the Board is fully informed of all matters
which may have a material impact on the ability of the
Company to meet its obligations.
Board Appointments
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.
The terms of the appointment of a non-executive director,
executive directors and senior executives are agreed upon
and set out in writing at the time of appointment.
The Company Secretary
The Company Secretary is accountable directly to the
Board, through the Chairman, 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.
Diversity
The Company values the differences between its
personnel and the valuable contribution that these
differences can make to the Company. The Company is an
equal opportunity employer and aims to recruit executives
and employees from as diverse a pool of qualified
candidates as reasonably possible based on their skills,
qualifications and experience.
The Company is committed to increasing diversity
amongst its employees, and not just in the area of gender
diversity. Our workforce is employed based on the
right person for the job regardless of their gender, age,
nationality, race, religious beliefs, cultural background,
sexuality or physical ability or appearance.
Executive and Board positions are filled by the best
candidates available without discrimination. The
Company is committed to increasing gender diversity
within these positions when appropriate appointments
become available. The Company is also committed to
identifying suitable persons within the organisation, and
where appropriate opportunities exist, advance diversity
to support the promotion of talented employees into
management positions.
The Company has not set any gender specific diversity
objectives as it believes that multicultural diversity and
other diversity factors are equally important within its
organisation.
The following table demonstrates the Company’s gender
diversity as at 30 June 2017:
Number of
Males
Number of
Females
Directors
Key Management Personnel
Other Company Employees
5
2
-
-
-
2
The Company employed 9 employees at the end of 2017
(2016: 9 employees).
22 ANTISENSE THERAPEUTICS
Board Performance Review
The Board considers the ongoing development and
improvement of its own performance, the performance
of individual directors and Board Committees as critical to
effective governance.
The Board has adopted an informal self-evaluation process
to measure its own performance. The performance of the
Board and individual directors is reviewed at least every
year by the Board as a whole. This process includes a
review in relation to the composition and skills mix of the
Directors of the Company. Performance reviews involve
analysis based on key performance indicators aligned with
the financial and non-financial objectives of the Company.
A performance review in accordance with the processes
disclosed occurred during the 2017 financial year.
Performance Review of KMP
On at least an annual basis, the Board conducts a formal
performance review of the Chief Executive Officer and
any other key management personnel (KMP). The Board
assesses the performance of KMP against qualitative and
quantitative key performance indicators relevant to each
KMP. A performance review of KMP occurred during the
2017 financial year in accordance with this process.
Independent Advice
The Board has procedures to allow Directors, in the
furtherance of their duties, to seek independent
professional advice at the Company's expense.
Principle 2:
Structure the Board to add value
Board composition
The length of service, skills, experience and expertise
of each Director in office at the date of this report and
throughout the 2017 financial year are included in the
Directors' Report under the section headed 'Directors'.
The Company's Board Charter stipulates that at least
50% of the Directors on the board should be independent
Directors. Directors of Antisense Therapeutics Limited are
considered to be independent when they are independent
of management and free from any business or other
relationship that could materially interfere with the
exercise of their independent judgement.
In the context of Director independence, to be considered
independent, a Non-Executive Director may not have a
direct or indirect material relationship with the Company.
The board considers that a material relationship is one
which impairs or inhibits, or has the potential to impair or
inhibit, a Director's exercise of judgement on behalf of the
Company and its shareholders.
From a quantitative perspective, an item is considered to
be quantitatively immaterial if it is equal to or less than 5%
of the relevant base amount. It is considered to be material
(unless there is qualitative evidence to the contrary) if it is
equal to or greater than 10% of the relevant base amount.
In accordance with the definition of independence above,
and the materiality thresholds described, the majority of
Directors are independent as set out below:
Name
Position
Mr Robert W Moses
Dr Graham Mitchell
Dr Gary Pace
Mr William Goolsbee
Independent Non-Executive
Chairman
Independent Non-Executive
Director
Independent Non-Executive
Director
Independent Non-Executive
Director
In accordance with the definition of independence above,
and the materiality thresholds described, the majority of
Directors are independent as set out below:
Name
Term in Office
Mr Robert W Moses
Mr Mark Diamond
Dr Graham Mitchell
15 years
15 years
15 years
Mr William Goolsbee
Since 15 October 2015
Dr Gary Pace
Since 9 November 2015
To ensure the Board is appropriately equipped to discharge
its responsibilities, it has developed guidelines for the
nomination and selection of Directors and for the operation
of the Board. As the Antisense Therapeutics Limited's
Board is not a large board, a formal nomination committee
has not been established, as it is perceived that no real
efficiencies would be gained from the existence of such
a committee. The charter of the nomination committee
has been incorporated into the Board Charter and by
this action the Board of Directors considers all matters
that would be relevant for a nomination committee. For
additional details please refer to the Company's Board
Charter on its website.
ANNUAL REPORT 2017 23
Corporate Governance continued
Principle 2:
Structure the Board to add value continued
Principle 4:
Safeguard integrity in corporate reporting
Induction of New Directors and Ongoing
Development
Audit Committee
Any new Directors will be 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.
A new director induction program is in place and Directors
are encouraged to engage in professional development
activities to develop and maintain the skills and knowledge
needed to perform their role as Directors effectively.
Principle 3:
Act ethically and responsibly
Code of Conduct
As part of its commitment to recognising the legitimate
interests of stakeholders, the Company has established a
Code of Conduct to guide compliance with legal and other
obligations to legitimate stakeholders.
The Board acknowledges the legitimate interest of various
stakeholders such as employees, clients, customers,
government authorities, creditors and the community
as a whole. As a good corporate citizen, it encourages
compliance and commitment to appropriate corporate
practices that are fair and ethical via its 'Code of Conduct'.
Trading in Company Securities
The Company has a 'Code of Practice - Buying & Selling
of Shares' that regulates the dealings by Directors and
employees, in shares, options and other securities issued
by the Company. The policy has been formulated to
ensure that Directors and employees are aware of the
legal restrictions on trading in Company securities while in
possession of unpublished price sensitive information.
The Audit Committee operates under a charter approved
by the Board. It is the Board's responsibility to ensure that
an effective control framework exists within the entity. This
includes ensuring that there are internal controls to deal
with both the effectiveness and efficiency of significant
business processes. This includes the safeguarding of
assets, the maintenance of proper accounting records
and the reliability of financial information as well as non-
financial considerations. The Board has delegated the
responsibility for the establishment and maintenance of a
framework of internal control and ethical standards for the
management of the Company to the Audit Committee.
The Audit Committee also provides the Board with
additional assurance regarding the reliability of financial
information for inclusion in the financial statements. All
members of the Audit Committee are Non-Executive
Directors. The Audit Committee is also responsible for the
nomination of the external auditor and for reviewing the
adequacy of the scope and quality of the annual statutory
audit and half year statutory review. The Audit Committee
Charter can be found on the Company's website.
The Audit Committee consists of two independent
Non-Executive Directors. Given the current size of the
Company, the Board believes that an Audit Committee
consisting of two members is sufficient to enable the
committee to discharge its mandate effectively. The
members of the Audit Committee during the year were Dr
Graham Mitchell (Chairperson) and Mr Robert W Moses.
For details on the number of meetings for the Audit
Committee held during the year and the attendances at
those meetings, refer to the Directors' Report under the
section headed 'Meetings of Directors'.
CEO and CFO Declarations
The CEO and CFO have provided the Board with 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.
24 ANTISENSE THERAPEUTICS
External Auditor
The Company's external auditor attends each annual
general meeting and is available to answer any questions
with regard to the conduct of the audit and their report.
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.
Principle 5:
Making timely and balanced disclosure
The Company has a 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 has designated the Company Secretary
as the person responsible for overseeing and co-
ordinating disclosure of information to the ASX as well
as communicating with the ASX. In accordance with ASX
Listing Rules the Company immediately notifies the ASX of
information concerning the Company:
(a) that a reasonable person would or may expect to
have a material effect on the price or value of the
Company's securities; and
(b) that would, or would be likely to, influence persons
who commonly invest in securities in deciding
whether to acquire or dispose of the Company's
securities.
Principle 6:
Respect the rights of shareholders
The Company is committed to providing current and
relevant information to its shareholders.
The Company respects the rights of its shareholders,
and to facilitate the effective exercise of the rights, the
Company is committed to:
(a) communicating effectively with shareholders through
ongoing releases to the market via ASX information
and general meetings of the Company;
(b) giving shareholders ready access to balanced and
understandable information about the Company and
corporate proposals;
(c) making it easy for shareholders to participate in
general meetings of the Company; and
Any shareholder wishing to make inquiries of the Company
is advised to contact the registered office. All public
announcements made by the Company can be obtained
from the ASX's website www.asx.com.au
Shareholders may elect to, and are encouraged to, receive
communications from the Company and its securities
registry electronically.
The Company maintains information in relation to its
corporate governance documents, Directors and senior
executives, Board and committee charters, annual reports
and ASX announcements on the Company’s website.
Principle 7:
Recognise and managing risk
The Board is committed to the identification, assessment
and management of risk throughout the Company’s
business activities.
The Board has established a policy for risk oversight and
management within the Company. This is periodically
reviewed and updated. Management reports risks
identified to the Board through the monthly Operations
Report, and via direct and timely communication to the
Board where and when applicable. During the reporting
period, management has reported to the Board as to
the effectiveness of the Company’s management of its
material business risks. The Company does not have an
internal audit function.
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 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 does not have separate risk committee.
The Board as whole is responsible is responsible for
overseeing the establishment and implementation of the
risk management system. Due to the size of the Board and
the Company, it is perceived that no real efficiencies would
be gained from the existence of separate risk committee.
ANNUAL REPORT 2017 25
Corporate Governance continued
Principle 7:
Recognise and managing risk continued
The Board review’s the entity’s risk management
framework at least annually to satisfy itself that it
continues to be sound. A review of the Company’s risk
management framework was conducted during the 2017
financial year.
Principle 8:
Remunerate fairly and responsibly
It is the Company's objective to maintain a high quality
Board and executive team by remunerating Directors at
relevant market conditions. To assist in achieving this
objective the Remuneration Committee remunerates
Directors and executives having regard to their
performance and the performance of the Company.
The expected outcomes of the remuneration policies and
practices are to enable the Company to motivate, retain
and attract Directors and executives who will create value
for shareholders.
Details relating to the policy for performance evaluation
and the amount of remuneration (monetary and non-
monetary) paid to each Director and to each of the five
highest-paid (non-director) executives during the year, are
set out in the Directors' Report under the section headed
'Remuneration Report'.
The members of the Remuneration Committee at the
date of this report were all independent Non-Executive
Directors, being Mr Robert W Moses and Dr Graham
Mitchell. Details relating to performance evaluation are
set out in the Directors' Report under the section headed
'Remuneration Report'. For details on the number of
meetings of the Remuneration Committee held during
the year and the attendees at those meetings, refer to
the Directors' Report under the section headed 'Meetings
of Directors'.
In accordance with the Company’s share trading policy,
participants in any 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.
Further details in relation to the company’s remuneration
policies are contained in the Remuneration Report, within
the Directors’ report.
26 ANTISENSE THERAPEUTICS
Annual Financial Statements
For the year ended 30 June 2017
Statement of Comprehensive Income
Statement of Financial Position
Statement of Changes in Equity
Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Shareholder Information
Company Information
28
29
30
31
32
53
54
58
60
ANNUAL REPORT 2017 27
Statement of Comprehensive Income
For the year ended 30 June 2017
Revenue
Other income
Depreciation expenses
Administrative expenses
Occupancy expenses
Patent expenses
Research and development expenses
Foreign exchange gains/(losses)
Loss before tax
Income tax benefit
Loss for the year
Other comprehensive income/(loss) for the year, net of tax
Total comprehensive loss for the year, net of tax
Loss per share
Basic loss per share
Diluted loss per share
The accompanying notes form part of these financial statements.
Notes
3
3
4
4
4
4
4
4
5
8
8
2017
$
140,169
399,203
2016
$
1,132,102
395,597
539,372
1,527,699
(4,890)
(5,882)
(1,855,147)
(1,792,216)
(119,795)
(115,299)
(202,924)
(311,501)
(1,103,966)
(1,847,505)
(7,449)
30,261
(2,754,799)
(2,514,443)
-
-
(2,754,799)
(2,514,443)
-
-
(2,754,799)
(2,514,443)
($1.71)
($1.71)
($1.43)
($1.43)
28 ANTISENSE THERAPEUTICS
ASSETS
Current Assets
Cash and cash equivalents
Trade and other receivables
Prepayments
Other current assets
Non-Current Assets
Plant and equipment
TOTAL ASSETS
LIABILITIES
Current Liabilities
Trade and other payables
Employee benefit liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Reserves
Accumulated losses
TOTAL EQUITY
Statement of Financial Position
For the year ended 30 June 2017
Notes
2017
$
2016
$
9
10
11
12
13
14
15
1,901,988
4,800,718
427,894
165,105
30,000
420,297
102,941
-
2,524,987
5,323,956
14,088
14,088
3,403
3,403
2,539,075
5,327,359
364,346
321,306
458,154
292,050
685,652
750,204
1,853,423
4,577,155
57,706,647
56,714,725
-
960,855
(55,853,224)
(53,098,425)
1,853,423
4,577,155
The accompanying notes form part of these financial statements.
ANNUAL REPORT 2017 29
Statement of Changes in Equity
For the year ended 30 June 2017
As at 1 July 2015
Loss for the period
Total comprehensive income
At 30 June 2016
Contributed
Equity
(Note 14)
Notes
Reserves
(Note 15)
Accumulated
Losses
Total
$
$
$
$
56,714,725
960,855 (50,583,982)
7,091,598
-
-
-
-
(2,514,443)
(2,514,443)
(2,514,443)
(2,514,443)
56,714,725
960,855 (53,098,425)
4,577,155
As at 1 July 2016
56,714,725
960,855 (53,098,425)
4,577,155
Loss for the period
Total comprehensive income
Issue of options
Transactions costs on options issues
Shares issued
At 30 June 2017
14.b
14.b
14.a
-
-
73,169
(42,102)
-
-
-
-
960,855
(960,855)
(2,754,799)
(2,754,799)
(2,754,799)
(2,754,799)
-
-
-
73,169
(42,102)
-
57,706,647
-
(55,853,224)
1,853,423
The accompanying notes form part of these financial statements.
30 ANTISENSE THERAPEUTICS
OPERATING ACTIVITIES
Licensing fees received
Payments to suppliers and employees
Interest received
R&D tax concession refund
Statement of Cash Flows
For the year ended 30 June 2017
Notes
2017
$
2016
$
69,115
1,000,000
(3,456,562)
(3,596,565)
77,628
395,597
134,842
436,697
Net cash flows used in operating activities
18
(2,914,222)
(2,025,026)
INVESTING ACTIVITIES
Payment for purchases of plant and equipment
11
Net cash flows used in investing activities
(15,575)
(15,575)
(3,861)
(3,861)
FINANCING ACTIVITIES
Proceeds from issues of securities
Capital raising costs
Net cash flows from financing activities
Net decrease in cash and cash equivalents
Cash and cash equivalents at 1 July
Cash and cash equivalents at 30 June
The accompanying notes form part of these financial statements.
73,169
(42,102)
31,067
-
-
-
(2,898,730)
(2,028,887)
4,800,718
6,829,605
1,901,988
4,800,718
9
9
ANNUAL REPORT 2017 31
Notes to the Financial Statements
For the year ended 30 June 2017
Note 1:
Significant Accounting Policies
1.a Corporate Information
The financial report of Antisense Therapeutics Limited
and its subsidiaries (the ‘Company’) for the Year Ended
30 June 2017 was authorised for issue in accordance
with a resolution of the Directors on 29 August 2017. The
financial report is for the Company consisting of Antisense
Therapeutics Limited and its subsidiaries.
Antisense Therapeutics Limited is a listed public company
limited by shares incorporated and domiciled in Australia
whose shares are publicly traded on the Australian
Securities Exchange. The Company also has a Level 1 ADR
program traded on the US over-the-counter market.
The principal activity of the Company is the research and
development of novel antisense pharmaceuticals.
1.b Basis of Preparation
The financial report is a general purpose financial
report, which has been prepared in accordance with the
requirements of the Corporations Act 2001 and Australian
Accounting Standards, required for a for-profit entity.
The financial report has been prepared on an accruals
basis and is based on historical costs. These consolidated
financial statements are presented in Australian dollar
($), which is the Company’s functional and presentation
currency. The Company is of a kind referred to in
ASIC Corporations (Rounding in Financial/Directors’
Reports) Instrument 2016/191 and in accordance with
that instrument, amounts in the consolidated financial
statements and directors’ report have been rounded off to
the nearest thousand dollars, unless otherwise stated.
Management is required to make judgements, estimates
and assumptions about carrying values of assets and
liabilities that are not readily apparent from other sources.
The estimates and associated assumptions are based on
historical experience and various other factors that are
believed to be reasonable under the circumstance, the
results of which form the basis of making the judgements.
Actual results may differ from these estimates. The
estimates and underlying assumptions are reviewed on
an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised
if the revision affects only that period, or in the period of
the revision and future periods if the revision affects both
current and future periods.
Judgements made by management in the application
of Australian Accounting Standards that have significant
effects on the financial statements and estimates with a
significant risk of material adjustments in the next year are
disclosed, where applicable, in the relevant notes to the
financial statements.
Accounting policies are selected and applied in a manner
which ensures that the resulting financial information
satisfies the concepts of relevance and reliability, thereby
ensuring that the substance of the underlying transactions
or other events is reported.
GOING CONCERN
Some of the risks inherent in the development of
pharmaceutical product include the uncertainty of
patent protection and proprietary rights, whether patent
applications and issued patents will offer adequate
protection to enable and commercially justify product
development or may infringe intellectual property rights of
other parties, and uncertainty in obtaining the necessary
clinical trial and/or regulatory authority approvals for product
development and commercialisation. Also a particular
compound may fail to achieve sufficient efficacy or safety
in the research and the clinical development process, or its
viability may be negatively impacted by strategic imperatives
including an assessment that the projects may not deliver a
sufficient return on investment or has been or may likely be
superseded by newer and potentially superior competitive
products or technologies. There is a risk that the Company
will be unable to find suitable development or commercial
partners for its projects, and that these arrangements may
not generate a material return for the Company.
The Company will need to access additional capital for
further development of its various development projects,
and to continue to pay its debts as and when they fall due
for a period of 12 months from signing the financial report.
The ability of the Company to successfully access additional
capital, and the amount of additional funds required is
dependent on the outcome of its product development
programs. The Company has agreed to a share placement
with Australian Ethical Investment. The issue of shares
to Australian Ethical Investment is conditional on the
Company receiving hospital approval any time before 30
September 2017 to commence the clinical trial of ATL1102
in DMD. Following the settlement of the placement, the
Company proposes to undertake a pro-rata Entitlement
Issue to shareholders. Along with pursuing such capital
raising initiatives, the Company is also actively seeking to
partner certain products in its pipeline (which may provide
additional capital in the form of license fees) and to access
non-dilutive grant funding for the continued development
of its product pipeline.
32 ANTISENSE THERAPEUTICS
The Company has incurred a loss after tax of $2,754,799 the year ended 30 June 2017, had an operating cash outflow
of $2,914,222 and has a net current asset position of $1,853,423. Notwithstanding the material uncertainty pertaining to
the ability of the Company to access additional capital, the financial statements have been prepared on a going concern
basis. Accordingly the financial statements do not include adjustments relating to the recoverability and classification of
recorded asset amounts, or the amounts and classification of liabilities that might be necessary should the Company not
continue as a going concern.
1.c Statement of Compliance
The financial report complies with Australian Accounting Standards as issued by the Australian Accounting Standards
Board and International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board.
1.d New, Revised or Amending Accounting Standards and Interpretations Adopted
There has been no requirement to adopt any new, revised or amended Accounting Standards for the year ended 30
June 2017.
The following Australian Accounting Standards and Interpretations have recently been issued or amended but are not yet
effective and therefore have not been adopted by the Company for the annual reporting period ended 30 June 2017:
Reference
Title
Summary
Application
AASB 9
Financial
Instruments
1 January
2018
AASB 9 introduces new requirements for the
classification and measurement of financial
assets and liabilities and includes a forward-
looking ‘expected loss’ impairment model and
a substantially-changed approach to hedge
accounting. These requirements improve and
simplify the approach for classification and
measurement of financial assets compared
with the requirements of AASB 139. The main
changes are:
a Financial assets that are debt instruments
will be classified based on:
(i) the objective of the entity’s business
model for managing the financial assets;
and
(ii) the characteristics of the contractual
cash flows.
b Allows an irrevocable election on initial
recognition to present gains and losses on
investments in equity instruments that are
not held for trading in other comprehensive
income (instead of in profit or loss).
Dividends in respect of these investments
that are a return on investment can be
recognised in profit or loss and there is no
impairment or recycling on disposal of the
instrument.
c
Introduces a ‘fair value through other
comprehensive income’ measurement
category for particular simple debt
instruments.
Impact on
financial
report
Application
date
minimal
1 July 2018
ANNUAL REPORT 2017 33
Notes to the Financial Statements
For the year ended 30 June 2017
Note 1:
Significant Accounting Policies continued
1.d New, Revised or Amending Accounting Standards and Interpretations Adopted continued
Impact on
financial
report
Application
date
minimal
1 July 2018
Reference
Title
Summary
Application
AASB 9
cont'd
Financial
Instruments
1 January
2018
d Financial assets can be designated and
measured at fair value through profit or loss
at initial recognition if doing so eliminates
or significantly reduces a measurement
or recognition inconsistency that would
arise from measuring assets or liabilities, or
recognising the gains and losses on them,
on different bases.
e Where the fair value option is used for
financial liabilities the change in fair value is
to be accounted for as follows:
• the change attributable to changes in credit
risk are presented in Other Comprehensive
Income (OCI)
• the remaining change is presented in profit
or loss If this approach creates or enlarges
an accounting mismatch in the profit or
loss, the effect of the changes in credit
risk are also presented in profit or loss.
Otherwise, the following requirements have
generally been carried forward unchanged
from AASB 139 into AASB 9:
• classification and measurement of financial
liabilities; and
• derecognition requirements for financial
assets and liabilities AASB 9 requirements
regarding hedge accounting represent a
substantial overhaul of hedge accounting
that enable entities to better reflect
their risk management activities in the
financial statements. Furthermore, AASB
9 introduces a new impairment model
based on expected credit losses. This
model makes use of more forward-looking
information and applies to all financial
instruments that are subject to impairment
accounting.
34 ANTISENSE THERAPEUTICS
Reference
Title
Summary
Application
Impact on
financial
report
Application
date
minimal
1 July 2018
1 January
2018
AASB 15
Revenue
from
Contracts
with
Customers
AASB 16
Leases
AASB 15 − replaces AASB 118 Revenue,
AASB 111 Construction Contracts and some
revenue-related Interpretations− establishes
a new revenue recognition model − changes
the basis for deciding whether revenue is to
be recognised over time or at a point in time
− provides new and more detailed guidance
on specific topics (e.g. multiple element
arrangements, variable pricing, rights of return,
warranties and licensing) − expands and
improves disclosures about revenue
AASB 16 − replaces AASB 117 Leases and
some lease-related Interpretations− requires
all leases to be accounted for ‘on-balance
sheet’ by lessees, other than short-term and
low value asset leases− provides new guidance
on the application of the definition of lease
and on sale and lease back accounting−
largely retains the existing lessor accounting
requirements in AASB 117− requires new and
different disclosures about leases.
1 January
2018
minimal
1 July 2019
1.e Principles of Consolidation
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Antisense Therapeutics
Ltd as at 30 June 2017 and the results of all subsidiaries for the year then ended.
Subsidiaries are all those entities where the Company is exposed, or has rights, to variable returns from the Company’s
involvement with the entity and has the ability to affect those returns through the Company’s power to direct the
activities of the entity. The existence and effect of potential voting rights that are currently exercisable or convertible are
considered when assessing whether the Company controls another entity.
Subsidiaries are fully consolidated from the date on which control is transferred to the Company. They are de-
consolidated from the date that control ceases.
In preparing the consolidated financial statements, all intercompany balances and transactions, and unrealised profits/
losses arising within the consolidated entity are eliminated in full. Investments in subsidiaries are accounted for at cost in
the individual financial statements of Antisense Therapeutics Limited.
1.f Summary of Significant Accounting Policies
a) Revenue Recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the
revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is
recognised.
b) Government Grants
Government grants are recognised when there is reasonable assurance that the grant will be received and all grant
conditions will be complied with.
When the grant relates to an expense item, it is recognised as income over the periods necessary to match the grant
on a systematic basis to the costs that it is expected to compensate.
ANNUAL REPORT 2017 35
Notes to the Financial Statements
For the year ended 30 June 2017
c) Borrowing Costs
h)
Income Taxes
Borrowing costs are expensed as incurred.
d) Leases
The minimum lease payments of operating leases,
where the lessor effectively retains substantially all of
the risks and benefits of ownership of the leased item,
are recognised as an expense on a straight-line basis.
e) Cash and Cash Equivalents
Cash and short-term deposits in the Statement of
Financial Position comprise cash at bank and in hand
and short-term deposits with an original maturity of
three months or less.
For the purposes of the Cash Flow Statement,
cash and cash equivalents consist of cash and cash
equivalents as defined above.
f) Trade and Other Receivables
Trade and other receivables are recognised initially at
fair value and subsequently measured at amortised
cost using the effective interest method, less an
allowance for impairment, once they become over due
by more than 60 days. A separate account records the
impairment.
An allowance for a doubtful debt is made when there
is objective evidence that the Company will not be able
to collect the debts. The criteria used to determine
that there is objective evidence that an impairment
loss has occurred include whether the Financial Asset
is past due and whether there is any other information
regarding increased credit risk associated with the
Financial Asset. Bad debts which are known to be
uncollectible are written off when identified.
g) Foreign Currencies
The functional currency of the Company is based
on the primary economic environment in which the
Company operates. The functional currency of the
Company is Australian dollars.
Transactions in foreign currencies are converted to
local currency at the rate of exchange at the date of
the transaction.
Amounts payable to and by the Company outstanding
at reporting date and denominated in foreign
currencies have been converted to local currency using
rates prevailing at the end of the financial year.
All exchange differences are taken to profit or loss.
36 ANTISENSE THERAPEUTICS
Deferred income tax is provided on all temporary
differences at the balance date between the tax bases
of assets and liabilities and their carrying amounts for
financial reporting purposes.
Deferred income tax liabilities are recognised for
all taxable temporary differences except where the
deferred income tax liability arises from the initial
recognition of an asset or liability in a transaction that
is not a business combination and, at the time of the
transaction, affects neither the accounting loss nor
taxable profit or loss.
Deferred income tax assets are recognised for all
deductible temporary differences, carry-forward of
unused tax assets and unused tax losses, to the extent
that it is probable that taxable profit will be available
against which the deductible temporary differences,
and the carry-forward of unused tax assets and unused
tax losses can be utilised except where the deferred
income tax asset relating to the deductible temporary
differences arises from the initial recognition of an
asset or liability in a transaction that is not a business
combination and, at the time of transaction, affects
neither the accounting loss nor taxable profit or loss.
The carrying amount of deferred income tax assets
is reviewed at each balance date and reduced to the
extent that it is no longer probable that sufficient
taxable profit will be available to allow all or part of the
deferred income tax asset to be utilised.
Deferred income tax assets and liabilities are measured
at the tax rates that are expected to apply to the year
when the asset is realised or the liability is settled,
based on tax rates (and tax laws) that have been
enacted or substantively enacted at balance date.
Deferred Tax assets are recognised for unused tax
losses to the extent that it is probable that taxable
profit will be available against which the losses can be
utilised. Significant management judgement is required
to determine the amount of deferred tax assets that
can be recognised, based upon the likely timing and
the level of future taxable profits together with future
tax planning strategies.
Antisense Therapeutics Limited have not assessed
unused tax losses carried forward at 30 June 2017,
given the history of losses from prior periods. These
losses do not expire and may be used to offset taxable
income in the current year and in future periods. Given
the history of losses, there is limited support for the
recognition of these losses as deferred tax assets.
On this basis, Antisense Therapeutics Limited has
determined it cannot recognise deferred tax assets on
the tax losses carried forward. Further, on this basis,
deferred tax assets have not been recognised related
to temporary differences.
Income taxes relating to items recognised directly in
equity are recognised in equity and not in profit or loss.
i) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of
the amount of GST, except:
• where the GST incurred on a purchase of goods
and services is not recoverable from the taxation
authority, in which case the GST is recognised as
part of the cost of acquisition of the asset or as
part of the expense item as applicable; and
• receivables and payables are stated with the
amount of GST included.
Cash flows arising from operating activities are
included in the Cash Flow Statement on a gross basis
(i.e. including GST) and the GST component of cash
flows arising from investing and financing activities,
which is recoverable from, or payable to, the taxation
authority are classified as operating cash flows.
Commitments and contingencies are disclosed net
of the amount of GST recoverable from, or payable
to, the taxation authority. The net amount of GST
recoverable from or payable to, the taxation authority
is included as part of the receivables or payables in the
Statement of Financial Position.
j) Plant and Equipment
Plant and equipment are measured at cost less
any accumulated depreciation and any impairment
losses. Such assets are depreciated over their useful
economic lives as follows:
and the ability to measure reliably the expenditure
attributable to the intangible asset during its
development.
Following initial recognition of the development
expenditure, the cost model is applied requiring the
asset to be carried at cost less any accumulated
amortisation and accumulated impairment losses. Any
expenditure so capitalised is amortised over the period
of expected benefits from the related project.
The carrying value of an intangible asset arising from
development expenditure is tested for impairment
annually when the asset is not available for use, or
more frequently when an indication of impairment
arises during the reporting period.
l)
Impairment of Non-Financial Assets
The carrying values of non-financial assets are tested
for impairment whenever events or changes in
circumstances indicate that the carrying amount may
not be recoverable.
An impairment loss is recognised for the amount
by which the asset's carrying amount exceeds its
recoverable amount. Recoverable amount is the higher
of an asset's fair value less costs of disposal and value
in use. For the purposes of assessing impairment,
assets are grouped at the lowest levels for which there
are separately identifiable cash inflows that are largely
independent of the cash inflows from other assets
or groups of assets (cash-generating units). Non-
financial assets that suffer an impairment are tested
for possible reversal of the impairment whenever
events or changes in circumstances indicate that the
impairment may have reversed.
An impairment exists when the carrying value of an
asset exceeds its estimated recoverable amount. The
asset is then written down to its recoverable amount.
Life
Method
m) Trade and other payables
Plant and equipment
3-5 years Straight line
k) Research and Development Costs
Research costs are expensed as incurred.
An intangible asset arising from development
expenditure on an internal project is recognised only
when the Company can demonstrate the technical
feasibility of completing the intangible asset so that
it will be available for use or sale, its intention to
complete and its ability to use or sell the asset, how
the asset will generate future economic benefits, the
availability of resources to complete the development
Trade and other payables are carried at amortised
cost and represent liabilities for goods and services
provided to the Company prior to the end of the
financial year that are unpaid and arise when the
Company becomes obliged to make future payments
in respect of the purchase of these goods and services.
Licensing fees are recognised as an expense when it is
confirmed that they are payable by the Company.
ANNUAL REPORT 2017 37
Notes to the Financial Statements
For the year ended 30 June 2017
Note 1:
Significant Accounting Policies continued
1.f Summary of Significant Accounting Policies
continued
n) Employee Benefits
Wages, salaries and annual leave
Liabilities for wages and salaries, including non-
monetary benefits and annual leave payments
expected to be settled within 12 months of the
reporting date are recognised in other provisions in
respect of employees' service up to the reporting date.
They are measured at the amounts expected to be
paid when the liabilities are settled.
Long Service Leave
The liability for long service leave is recognised for
employee benefits and measured as the present value
of expected future payments to be made in respect
of services provided by employees up to the reporting
date. Consideration is given to expected future wage
and salary levels, experience of employee departures,
and periods of service. Expected future payments are
discounted using market yields at the reporting date
on national corporate bonds with terms to maturity
and currencies that match, as closely as possible, to
the estimated future cash outflows.
0) Contributed Equity
Ordinary shares are classified as equity. Any
transaction costs arising on the issue of ordinary
shares are recognised directly in equity as a reduction
(net of tax) of the share proceeds received.
p) Earnings Per Share
Basic earnings per share is calculated as net gain
attributable to members, adjusted to exclude costs of
servicing equity (other than dividends), divided by the
weighted average number of ordinary shares, adjusted
for any bonus element.
Diluted earnings per share is calculated as net gain
attributable to members, adjusted for:
• costs of servicing equity (other than dividends);
• the after tax effect of dividends and interest
associated with dilutive potential ordinary shares
that have been recognised as expenses;
• other non-discretionary changes in revenues or
expenses during the period that would result from
the dilution of potential ordinary shares; divided by
the weighted average number of ordinary shares
and dilutive potential ordinary shares, adjusted for
any bonus element.
q) Parent Information
The financial information for the parent entity,
Antisense Therapeutics Limited, disclosed in Note
2 has been prepared on the same basis as the
consolidated statements with the exception of
investments in subsidiaries which are carried at costs
less any impairment.
38 ANTISENSE THERAPEUTICS
Note 2:
Information Relating to the Antisense Therapeutics Limited (the Parent)
ASSETS
Current assets
Non-current assets
Total assets
LIABILITIES
Current liabilities
Total liabilities
EQUITY
Contributed equity
Reserves
Retained earnings
Total equity
Net loss for the year
Total comprehensive loss of the Parent entity
Note 3: Revenue and Other Income
REVENUE
Licensing revenue
Interest from external parties
Total revenue
OTHER INCOME
Research and development tax concession
Total other income
Total revenue & other income
2017
$
2016
$
2,524,987
5,323,956
14,088
3,403
2,539,075
5,327,359
685,652
685,652
750,204
750,204
57,706,647
56,714,725
-
960,855
(55,853,224)
(53,098,425)
1,853,423
4,577,155
(2,754,799)
(2,514,443)
(2,754,799)
(2,514,443)
2017
$
2016
$
69,115
71,054
1,000,000
132,102
140,169
1,132,102
399,203
399,203
395,597
395,597
539,372
1,527,699
The licence fee of $1m received in the prior year relates to the payment made to terminate the licensing partnership for
ATL1103 by Strongbridge Biopharma (formerly Cortendo Caymen Limited).
ANNUAL REPORT 2017 39
Notes to the Financial Statements
For the year ended 30 June 2017
Note 4: Expenses
Administrative Expenses
Compliance expenses
Office expenses
Corporate employee expenses
Other
Business development expenses
Total administrative expenses
Occupancy Expenses
Rent
Other expenses
Total occupancy expenses
Research and Development Expenses
ATL 1102
ATL 1103
R&D Staff Costs
Total Research and Development Expenses
Patent expenses
Depreciation expenses
Foreign exchange gains/(losses)
Total Expenses
2017
$
273,571
50,849
764,360
596
2016
$
243,442
43,979
729,768
-
765,771
775,027
1,855,147
1,792,216
98,777
21,018
119,795
98,777
16,522
115,299
567,182
1,806,896
386,700
150,084
11,508
29,101
1,103,966
1,847,505
202,924
4,890
7,449
311,501
5,882
(30,261)
3,294,171
4,042,142
40 ANTISENSE THERAPEUTICS
Note 5: Income Tax
Accounting (loss)/profit before income tax
At Australia's statutory income tax rate of 30% (2016: 30%)
Research and development tax concession
Non-assessable grant income
Section 40-880 deductions
Entertainment
Tax (benefit)/losses not previously recognised
Income tax expense reported in the statement of profit or loss
Income tax attributable to a discontinued operation
Income tax expense/(benefit) attributable to the Company
Deferred Tax
Deferred tax assets and liabilities:
Accruals
Provision for annual leave & long service leave
Other
Net deferred tax asset/ (liability) not recognised
Net deferred tax asset/ (liability)
Tax Losses
2017
$
2016
$
(2,754,799)
(2,514,443)
(826,439)
(754,333)
841,760
(119,761)
(22,920)
1,911
794,522
(118,679)
(50,391)
960
(125,449)
(127,921)
-
-
-
-
-
-
22,910
8,776
(1,492)
30,194
-
(33,986)
747
(2,263)
(35,502)
-
Antisense Therapeutics Limited has unconfirmed, unrecouped tax losses in Australia which have not been brought to
account. The ability to be able to recognise a deferred tax asset in respect of these tax losses will be dependent upon
the probability that future taxable profit will be available against which the unused tax losses can be utilised and the
conditions for deductibility imposed by Australian tax authorities will be complied with.
Unused tax losses for which no deferred tax asset has been recognised
44,840,832
42,378,120
44,840,832
42,378,120
Note 6: Key Management Personnel Compensation
The aggregate compensation made to Directors and other Key Management Personnel of the Company is set out below:
2017
$
2016
$
Short-term employee benefits
Post-employment benefits
Long-term benefits
2017
$
2016
$
878,894
888,695
49,162
11,197
59,227
11,157
939,253
959,079
For more information on Key Management Personnel Compensation, please refer to the Remuneration Report contained
under Directors’ Report.
ANNUAL REPORT 2017 41
Notes to the Financial Statements
For the year ended 30 June 2017
Note 7: Auditors’ Remuneration
The auditor of Antisense Therapeutics Limited is Ernst and Young.
Amounts received or due and receivable by Ernst and Young for:
An audit or review of the financial report of the entity
50,985
50,985
2017
$
2016
$
Other services in relation to the entity:
Tax compliance services
Note 8: Earnings per share (EPS)
19,250
70,235
19,250
70,235
Basic EPS is calculated by dividing profit for the year attributable to ordinary equity holders of the Parent by the
weighted average number of ordinary shares outstanding during the year.
Diluted EPS is calculated by dividing the net profit attributable to ordinary equity holders of the Parent (after adjusting
for interest on the convertible preference shares) by the weighted average number of ordinary shares outstanding during
the year plus the weighted average number of ordinary shares that would be issued on conversion of all the dilutive
potential ordinary shares into ordinary shares.
The following table reflects the income and share data used in the basic and diluted EPS computations:
Net profit/(earnings/(losses)) used in the calculation of basic and diluted earnings/
(losses) per share
2017
$
2016
$
(2,754,799)
(2,514,443)
Weighted average number of ordinary shares for basic EPS
161,525,282
175,198,815
Adjustments for calculation of diluted earnings/(losses) per share:
Weighted average number of ordinary shares adjusted for the effect of dilution
161,525,282
175,198,815
There have been no other conversions to, call of, or subscriptions for ordinary shares, or issues of potential ordinary
shares since the reporting date and before the completion of this financial report.
Note 9: Cash and Cash Equivalents
Cash at bank and on hand
Short-term deposits
2017
$
2016
$
401,988
300,718
1,500,000
4,500,000
1,901,988
4,800,718
The interest rate on cash at bank at 30 June 2017 was 0.10%p.a. (2016: 0.10% p.a.). And the interest rates on term
deposits at 30 June 2017 were 1.84% p.a. (2016: 2.55% p.a.) for 30 days and 2.19% p.a. (2016: 2.85%) for 90 days. The
term deposits have maturity periods of 30 days and 90 days.
42 ANTISENSE THERAPEUTICS
Note 10: Trade and Other Receivables
Interest receivable
Australian Tax Office receivable
Research and development tax concession receivable
Other receivables
Note 11: Property, Plant and Equipment
Cost
At 1 July 2015
Additions
At 30 June 2016
At 1 July 2016
Additions
At 30 June 2017
Depreciation and impairment
At 1 July 2015
Depreciation charge for the year
At 30 June 2016
At 1 July 2016
Depreciation charge for the year
At 30 June 2017
Gross value
Accumulated depreciation
2017
$
3,265
7,468
399,203
17,958
2016
$
9,839
2,617
395,597
12,244
427,894
420,297
Property, plant and
equipment
$
172,209
3,861
176,070
176,070
15,575
191,645
(166,785)
(5,882)
(172,667)
(172,667)
(4,890)
(177,557)
2017
$
2016
$
191,645
176,070
(177,557)
(172,667)
14,088
3,403
ANNUAL REPORT 2017 43
Notes to the Financial Statements
For the year ended 30 June 2017
Note 12: Trade and Other Payables
Trade payables
Accrued expenses
Other payables
Note 13: Employee Benefit Liabilities
Current employee provisions
Note 14: Contributed Equity
Ordinary fully paid shares
Note 14(a): Ordinary Shares
2017
$
165,694
194,075
4,577
2016
$
214,791
238,786
4,577
364,346
458,154
2017
$
321,306
321,306
2016
$
292,050
292,050
2017
$
2016
$
56,466,535
55,505,680
Note
14(a)
2017
No.
$
2016
No.
$
At the beginning of the period
176,512,483
55,505,680
176,512,483
55,505,680
Shares issued during the year
72,000
960,855
Transaction costs relating to share issues
Cancellation of shares (1)
-
-
-
-
-
-
(15,025,075)
-
-
-
Balance at the end of the year
161,559,408
56,466,535
161,487,408
55,505,680
(1) 15,025,075 shares have been cancelled during the prior reporting period due to the termination of the partnership
agreement with Strongbridge Biopharma (formerly Cortendo Caymen Limited).
Details of movement in shares:
2017
Details
Number
30 June 2017
Shares issued during the period
72,000
2016
Details
No.
Issue Price
30 June 2016
Cancelled shares
(15,025,075)
Transaction costs
Issue Price
AUD
$
-
$
-
$
-
$
-
(1,540)
Ordinary shares participate in dividends and the proceeds on winding up of the Company in proportion to the number
of shares held. At shareholder meetings each ordinary share is entitled to one vote when a poll is called, otherwise each
shareholder has one vote on a show of hands. The ordinary shares have no par value.
44 ANTISENSE THERAPEUTICS
Note 14(b) Options
Reconciliation of option movement in the period:
2017
No.
$
2016
No.
$
1,209,045
46,950,984
1,209,045
At the beginning of the period
Options issued during the period
Capital raising costs associated with
options issues
46,950,984
68,713,794
-
73,169
(42,102)
Options expired during the period
(46,950,984)
-
-
-
-
-
-
-
68,713,794
1,240,112
46,950,984
1,209,045
Note 15: Reserves
Nature and Purpose of the Reserve
The option reserve recognises the proceeds from the issue of options over ordinary shares and the expense recognised
in respect of share based payments.
Unlisted options over fully paid shares
2017
No.
-
$
-
2016
No.
72,000
$
960,855
During the year ended 30 June 2017 72,000 options have been exercised. There was no activity during the year ended
30 June 2016.
Options outstanding as at 30 June 2017:
On issue at beginning of year
Issued during the year
Exercised during the year
Expired during the year
Forfeited during the year
Consolidation 10:1 Nov 2013
Outstanding at balance sheet date
Expired subsequent to balance date
Exercised subsequent to balance date
Outstanding at date of Directors’ Report
Original number of recipients
Number of current holders
Exercise price
Exercise period from
To (expiration day)
No. of Options
27 Oct 2008
20 Nov 2013
20 Dec 2016
72,000
46,950,984
-
(72,000)
-
-
-
-
-
-
-
4
-
-
-
-
(46,950,984)
-
-
-
-
-
-
849
-
$0.27
-
68,713,794
-
-
-
-
68,713,794
-
-
-
1,529
1,529
$0.08
27 Oct 2008
20 Nov 2013
20 Dec 2016
30 Jul 2018
31 Jan 2017
19 Dec 2019
The following proportion of options vest from the dates shown:
100%
27 Oct 2008
20 Nov 2013
19 Dec 2019
ANNUAL REPORT 2017 45
Notes to the Financial Statements
For the year ended 30 June 2017
Note 16: Commitments and Contingencies
Operating Lease Commitments
Future minimum rentals payable under non-cancellable operating leases as at 30 June are, as follows:
Within one year
2017
$
24,693
24,693
2016
$
24,693
24,693
The lease expenditure commitments relate to the leasing of office premises. The lease is for a term of one year, expiring
October 2017.
There are no contingencies in the current or preceding year.
Note 17: Operating Segments
The Company has identified its operating segments based on the internal reports that are reviewed and used by the
management team in assessing performance and determining allocation of the resources.
The operating segments are identified by management based on the manner in which the expenses are incurred, and for
the purpose of making decisions about resource allocation and performance assessment.
Discrete financial information about each of these operating segments is reported by the executive management team to
the board on a regular basis.
For the management purposes, the Company prepares its reporting for the following two operating segments that has
been identified based on its antisense oligonucleotide products that are currently under development:
• ATL1102 product for multiple sclerosis; and
• ATL1103 product for acromegaly.
All revenue and expenses that do not directly relate to these two operating segments have been currently reported as
unallocated.
ATL1102
Multiple
Sclerosis
ATL1103
Growth and
Sight Disorders
$
-
(285,679)
(285,679)
$
69,115
(269,000)
(199,885)
ATL1102
Multiple
Sclerosis
ATL1103
Growth and
Sight Disorders
$
-
(1,594,423)
(1,594,423)
$
1,000,000
171,616
1,171,616
Unallocated
(Note a)
$
71,054
Total
$
140,169
(2,340,289)
(2,894,968)
(2,269,235)
(2,754,799)
Unallocated
(Note a)
$
132,102
Total
$
1,132,102
(2,223,738)
(3,646,545)
(2,091,636)
(2,514,443)
30 June 2017
Segment revenue
Segment result
Net result
30 June 2016
Segment revenue
Segment result
Net result
46 ANTISENSE THERAPEUTICS
Note 17(a) Unallocated breakdown
Unallocated revenue
Interest from external parties
Unallocated result
Compliance expenses
Business development expenses
Employee expenses
Patent expenses
Other expenses
Note 18: Cash Flow Information
Reconciliation of cash flow from operations with loss after income tax
2017
$
71,054
71,054
(273,571)
(765,771)
(764,360)
(202,924)
(333,663)
2016
$
132,102
132,102
(243,442)
(775,027)
(729,768)
(311,501)
(164,000)
(2,340,289)
(2,223,738)
2017
$
2016
$
Cash flow reconciliation
Reconciliation of net loss after tax to net cash flows from operations:
Net loss before tax
(2,754,799)
(2,514,443)
Adjustments to reconcile loss before tax to net cash flows:
Depreciation expense
Working capital adjustments:
Movement in trade and other receivables
Movement in prepayments
Movement in trade and other payables
Movement in other current assets
Movement in provisions
4,890
5,882
(7,597)
(62,164)
(93,808)
(30,000)
29,256
324,185
(9,412)
166,272
-
2,490
Net cash flows used in operating activities
(2,914,222)
(2,025,026)
Note 19: Events After the Reporting Period
There have not been any matters or circumstances, other than that referred to in the financial statements or notes
thereto, that have arisen since the end of the financial year, which significantly affected, or may significantly affect,
the operations of Antisense Therapeutics Limited, the results of those operations or the state of affairs of Antisense
Therapeutics Limited in future financial years.
ANNUAL REPORT 2017 47
Notes to the Financial Statements
For the year ended 30 June 2017
Note 20: Related Party Transactions
There were no transactions with related parties during the current financial year.
Note 21: Financial Risk Management Objectives and Policies
21(a) Financial Instruments
The Company's financial instruments consist of cash and cash equivalents, trade and other receivables and trade and
other payables:
Cash and cash equivalents
Trade and other receivables
Trade and other payables
2017
$
2016
$
1,901,988
4,800,718
427,894
420,297
(364,346)
(458,154)
The Company does not have any derivative instruments at 30 June 2017 (2016: Nil).
21(b) Risk Management Policy
The Board is responsible for overseeing the establishment and implementation of the risk management system, and
reviews and assesses the effectiveness of the Company's implementation of that system on a regular basis.
The Board and Senior Management identify the general areas of risk and their impact on the activities of the Company,
with Management performing a regular review of:
• the major risks that occur within the business;
• the degree of risk involved;
• the current approach to managing the risk; and
•
if appropriate, determine:
(i) any inadequacies of the current approach; and
(ii) possible new approaches that more efficiently and effectively address the risk.
Management report risks identified to the Board through the monthly Operations Report.
The Company seeks to ensure that its exposure to undue risk which is likely to impact its financial performance,
continued growth and survival is minimised in a cost effective manner.
21(c) Significant Accounting Policy
Details of significant accounting policies and methods adopted, including the criteria for recognition, the basis for
measurement and the basis on which income and expenses are recognised, in respect of each class of financial asset,
financial liability and equity instrument are disclosed in Note 1 to the financial statements.
The carrying amounts of cash and cash equivalents, trade and other receivables and trade and other payables represents
their fair values determined in accordance with the accounting policies disclosed in Note 1.
Interest revenue on cash and cash equivalents and foreign exchange movements on trade and other receivables and
trade and other payables are disclosed in Notes 3 and 4.
48 ANTISENSE THERAPEUTICS
21(d) Capital Risk Management
The Company's objectives when managing capital are to safeguard the Company's ability to continue as a going concern
and to maintain an optimal capital structure so as to maximise shareholder value. In order to maintain or achieve an
optimal capital structure, the Company may issue new shares or reduce its capital, subject to the provisions of the
Company's constitution.
The capital structure of the Company consists of equity attributed to equity holders of the Company, comprising
contributed equity, reserves and accumulated losses disclosed in Notes 14 and 15. By monitoring undiscounted cash flow
forecasts and actual cash flows provided to the Board by the Company's Management the Board monitors the need to
raise additional equity from the equity markets.
21(e) Financial Risk Management
The main risks the Company is exposed to through its operations are interest rate risk, foreign exchange risk, credit risk
and liquidity risk.
INTEREST RATE RISK
The Company is exposed to interest rate risks via the cash and cash equivalents that it holds. Interest rate risk is the risk
that a financial instruments value will fluctuate as a result of changes in market interest rates. The objective of managing
interest rate risk is to minimise the Company's exposure to fluctuations in interest rate that might impact its interest
revenue and cash flow.
To manage interest rate risk, the Company locks a portion of the Company's cash and cash equivalents into term
deposits. The maturity of term deposits is determined based on the Company's cash flow forecast.
Interest rate risk is considered when placing funds on term deposits. The Company considers the reduced interest rate
received by retaining cash and cash equivalents in the Company's operating account compared to placing funds into a
term deposit. This consideration also takes into account the costs associated with breaking a term deposit should early
access to cash and cash equivalents be required.
30 June 2017
Financial Assets
Weighted
Average
Effective
Interest
Rate
Floating
Interest
Rate
Fixed
Interest
Rate
within
Year
Fixed
Interest
Rate 1 to 5
Years
Fixed
Interest
Rate over
5 Years
%
$
$
Cash & cash equivalents
2.02
401,588
1,500,000
Trade & other receivables
-
-
-
2.02
401,588 1,500,000
Financial Liabilities
Trade & other payables
-
-
-
$
-
-
-
-
Non-
Interest
Bearing
$
Total
$
400
1,901,988
427,894
427,894
428,294 2,329,882
$
-
-
-
-
(364,346)
(364,346)
ANNUAL REPORT 2017 49
Notes to the Financial Statements
For the year ended 30 June 2017
21(e) Financial Risk Management continued
INTEREST RATE RISK continued
30 June 2016
Financial Assets
Weighted
Average
Effective
Interest
Rate
Floating
Interest
Rate
Fixed
Interest
Rate
within
Year
Fixed
Interest
Rate 1 to 5
Years
Fixed
Interest
Rate over
5 Years
%
$
$
Cash & cash equivalents
2.54
300,318 4,500,000
Trade & other receivables
-
-
-
2.54
300,318 4,500,000
Financial Liabilities
Trade & other payables
-
-
-
Non-
Interest
Bearing
$
Total
$
400 4,800,718
420,297
420,297
420,697
5,221,015
$
-
-
-
-
(458,154)
(458,154)
$
-
-
-
-
There has been no change to the Company's exposure to interest rate risk or the manner in which it manages and
measures its risk in the year ended 30 June 2017.
The Company has conducted a sensitivity analysis of the Company's exposure to interest rate risk. The percentage
change is based on the expected volatility of interest rates using market data and analysts forecasts. The analysis shows
that if the Company's interest rate was to fluctuate as disclosed below and all other variables had remained constant,
then the interest rate sensitivity impact on the Company's profit after tax and equity would be as follows:
2017: +1% (2016: +1%)
2017: -1% (2016: -1%)
FOREIGN CURRENCY RISK
(Higher) / Lower
(Higher) / Lower
2017
19,020
(19,020)
2016
48,007
(48,007)
The Company is exposed to foreign currency risk via the trade and other receivables and trade and other payables that
it holds. Foreign currency risk is the risk that the value of a financial instrument will fluctuate due to changes in foreign
exchange rates. The Company aims to take a conservative position in relation to foreign currency risk hedging when
budgeting for overseas expenditure however; the Company does not have a policy to hedge overseas payments or
receivables as they are highly variable in amount and timing, due to the reliance on activities carried out by overseas entities
and their billing cycle.
The following financial assets and liabilities are subject to foreign currency risk:
Trade and other payables (AUD/USD)
Trade and other payables (AUD/GBP)
Trade and other payables (AUD/EUR)
50 ANTISENSE THERAPEUTICS
2017
$
(21,193)
3,894
1,115
2016
$
124,724
1,333
24,849
Foreign currency risk is measured by regular review of our cash forecasts, monitoring the dollar amount and currencies
that payment are anticipated to be paid in. The Company also considers the market fluctuations in relevant currencies to
determine the level of exposure. If the level of exposure is considered by Management to be too high, then Management
has authority to take steps to reduce the risk.
Steps to reduce risk may include the acquisition of foreign currency ahead of the anticipated due date of an invoice or
may include negotiations with suppliers to make payment in our functional currency. Management mitigated foreign
currency risk by purchasing Great British Pounds currency during the current financial year. Should Management
determine that the Company should consider taking out a hedge to reduce the foreign currency risk, they would need to
seek Board approval.
The Company conducts some activities outside of Australia which exposes it to transactional currency movements,
where the Company is required to pay in a currency other than its functional currency.
There has been no change in the manner the Company manages and measures its risk in the Year Ended 30 June 2017.
The Company is exposed to fluctuations in United States dollars, Euros, and Great British Pounds. Analysis is conducted
on a currency by currency basis using sensitivity variables.
The Company has conducted a sensitivity analysis of the Company's exposure to foreign currency risk. The sensitivity
analysis variable is based on the expected overall volatility of the significant currencies, which is based on management’s
assessment of reasonable possible fluctuations taking into consideration movements over the last 6 months each year
and the spot rates at each reporting date. The analysis shows that if the Company's exposure to foreign currency risk was
to fluctuate as disclosed below and all other variables had remained constant, then the foreign currency sensitivity impact
on the Company's loss after tax and equity would be as follows:
AUD/USD: 2017: +3% (2016: +3%)
AUD/USD: 2017: -3% (2016: -3%)
AUD/GBP: 2017: +3% (2016: +3%)
AUD/GBP: 2017: -3% (2016: -3%)
AUD/EUR: 2017: +3% (2016: +3%)
AUD/EUR: 2017: -3% (2016: -3%)
CREDIT RISK
(Higher) / Lower
(Higher) / Lower
2017
636
(636)
117
(117)
33
(33)
2016
(3,742)
3,742
40
(40)
745
(745)
The Company is exposed to credit risk via its cash and cash equivalents and trade and other receivables. Credit risk is the
risk that a counter-party will default on its contractual obligations resulting in a financial loss to the Company. To reduce
risk exposure for the Company's cash and cash equivalents, it places them with high credit quality financial institutions.
Historically the Company has had minimal trade and other receivables, with the majority of its funding being provided
via shareholder investment. Traditionally the Company's trade and other receivables relate to GST refunds and Research
and Development Tax Concession amounts due to the Company from the Australian Tax Office. At 30 June 2017 GST
accounted for $7,468 (2016: $13,608) of the trade and other receivables, respectively. At 30 June 2017, accrued interest
from the Commonwealth Bank amounted to $3,265 (2016: $9,839).
The trade and other receivables at 90+ days also include the rent bond on the office premises of $8,231. This is not
considered impaired. The Board believes that the Company does not have significant credit risk at this time in respect of
its trade and other receivables.
ANNUAL REPORT 2017 51
Notes to the Financial Statements
For the year ended 30 June 2017
21(e) Financial Risk Management continued
CREDIT RISK continued
The Company has analysed its trade and other receivables below. All trade and other receivables disclosed below have
not been impaired.
2017 Trade and other receivables
2016 Trade and other receivables
LIQUIDITY RISK
0-30 days
31-60 days
61-90 days
90+ days
$
427,894
420,297
$
-
-
$
-
-
$
-
-
The Company is exposed to liquidity risk via its trade and other payables. Liquidity risk is the risk that the Company will
encounter difficulty in raising funds to meet the commitments associated with its financial instruments. Responsibility for
liquidity risk rests with the Board who manage liquidity risk by monitoring undiscounted cash flow forecasts and actual
cash flows provided to them by the Company's Management at Board meetings to ensure that the Company continues to
be able to meet its debts as and when they fall due. Contracts are not entered into unless the Board believes that there
is sufficient cash flow to fund the associated commitments. The Board considers when reviewing its undiscounted cash
flow forecasts whether the Company needs to raise additional funding from the equity markets.
The Company has analysed its trade and other payables below:
2017 Trade and other payables
2016 Trade and other payables
Note 22: Company Information
Information about subsidiaries
0-30 days
31-60 days
61-90 days
90+ days
$
364,346
458,154
$
-
-
$
-
-
$
-
-
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in
accordance with the accounting policy:
Name
Principal Activities
Country of incorporation
Antisense Therapeutics (HK) Pty Ltd
Provision of licenses
Australia
% Equity interest
2017
100
52 ANTISENSE THERAPEUTICS
Directors' Declaration
In accordance with a resolution of the Directors of Antisense Therapeutics Limited, we state that:
1.
In the opinion of the Directors:
(a) the consolidated financial statements and notes of Antisense Therapeutics Limited for the financial Year Ended
30 June 2017 are in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the consolidated entity's financial position as at 30 June 2017 and of its
performance for the Year Ended on that date; and
(ii) complying with Accounting Standards and the Corporations Regulations 2001;
(b) the consolidated financial statements and notes also comply with International Financial Reporting Standards as
disclosed in Note 1.c; and
(c) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become
due and payable.
2. This declaration has been made after receiving the declarations required to be made to the Directors by the chief
executive officer and chief financial officer in accordance with section 295A of the Corporations Act 2001 for the
financial Year Ended 30 June 2017.
On behalf of the board,
Signed in accordance with a resolution of the Directors.
Mr Robert W Moses
Independent Non-Executive Chairman
Mr Mark Diamond
Managing Directer and Chief Executive Officer
Dated: This day 29th day of August 2017
ANNUAL REPORT 2017 53
Independent Auditor's Report
Ernst & Young
8 Exhibition Street
Melbourne VIC 3000 Australia
GPO Box 67 Melbourne VIC 3001
Tel: +61 3 9288 8000
Fax: +61 3 8650 7777
ey.com
Independent auditor’s report to the members of Antisense
Therapeutics Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Antisense Therapeutics Limited (the Company) and its subsidiaries
(collectively the Group), which comprises the consolidated statement of financial position as at 30 June
2017, the consolidated statement of comprehensive income, consolidated statement of changes in equity
and consolidated 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.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
2001, including:
a) giving a true and fair view of the consolidated financial position of the Group as at 30 June 2017 and
of its financial performance for the year ended on that date; and
b) 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 Group 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 (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.
Material Uncertainty Related to Going Concern
Without qualifying our opinion, we draw attention to Note 1 in the financial report which describes the
principal conditions that raise doubt about the consolidated entity’s ability to continue as a going concern.
These conditions indicate the existence of a material uncertainty that may cast significant doubt about
the entity’s ability to continue as a going concern and therefore, the entity may be unable to realise its
assets and discharge its liabilities in the normal course of business.
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. In addition to the matter described in the Material Uncertainty Related to
Going Concern section, we have determined the matter described below to be the key audit matter to be
communicated in our report.
54 ANTISENSE THERAPEUTICS
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 & Development tax benefit
Why significant
How our audit addressed the key audit matter
We evaluated the methodology and assumptions
used by the Group in calculating the R&D income
tax credit claim receivable with reference to the
applicable legislation and in conjunction with our
R&D taxation specialists.
We tested the mathematical accuracy of the
Group’s calculations. We also compared historical
estimates against the actual claims received in
prior years.
Under the Australian Government’s Research &
Development (“R&D”) income tax credit regime,
the Group is entitled to an R&D credit on eligible
R&D expenditure incurred including the decline in
value of depreciating assets used in eligible R&D
activities.
The Group has estimated the R&D credit for the
year ended 30 June 2017 and recognised the
amount receivable under the scheme upon filing
their claim along with the lodgement of their
tax return. The estimated amount of $399,203
is recorded as Other income in the Consolidated
Statement of Comprehensive Income and a
receivable in the Consolidated Statement of
Financial Position.
The Group’s policy for accounting for this income
and the receivable are disclosed in Note 1.
This was considered a key audit matter due to
the quantum of the receivable recorded and the
judgment associated with applying the relevant
income tax legislation.
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 2017 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.
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.
ANNUAL REPORT 2017 55
Independent Auditor's Report continued
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.
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 Group’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 Group 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 Group’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 Group’s ability to continue as a going concern.
If we conclude that a material uncertainty exists, we are required to draw attention in our 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 Group to cease to
continue as a going concern.
56 ANTISENSE THERAPEUTICS
• 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, related safeguards.
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 pages 14 to 19 of the directors' report for the year
ended 30 June 2017.
In our opinion, the Remuneration Report of Antisense Therapeutics Limited for the year ended 30 June
2017, 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
Joanne Lonergan
Partner Melbourne
29 August 2017
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
ANNUAL REPORT 2017 57
Shareholder Information
As at 7 September 2017
Number of Holders of Equity Securities
Ordinary Shares
Distribution of Quoted Security holders
161,559,408 fully paid ordinary shares are held by 1,467
individual shareholders.
All ordinary shares carry one vote per share.
Options
68,713,794 options exercisable at $0.08 on or before 19
December 2019, are held by 1,464 individual holders.
Options do not carry a right to vote. Voting rights will be
attached to the unissued shares when the options have
been exercised.
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 +
Total number of
shareholders
Unmarketable
parcels
(under $500)
Twenty Largest Ordinary Shareholders
Shareholders
1
2
OPTHEA LIMITED
CITICORP NOMINEES PTY LIMITED
3 MR ROBERT WILLIAM MOSES
4
5
6
7
8
9
SHARED OFFICE SERVICES PTY LTD
CITYCASTLE PTY LTD
BNP PARIBAS NOMINEES PTY LTD
FLINTBERG PTY LTD
SKED PTY LTD
BAYSPEC PTY LTD
10 DABCO HOLDINGS PTY LTD
11
TRE PTY LTD