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Plus Therapeutics2013 BIONOMICS
ANNUAL REPORT
A LEADING INTERNATIONAL
DRUG DISCOVERY AND DEVELOPMENT COMPANY
1
CONTENTS
PG 1
VISION
PG 2
PG 3
PG 4
HIGHLIGHTS
CHAIRMAN’S LETTER
CEO & MANAGING DIRECTOR’S REPORT
PG 14
PIPELINE
PG 15
INTELLECTUAL PROPERTY PORTFOLIO
PG 18
BOARD OF DIRECTORS
PG 20
MANAGEMENT
PG 21
CORPORATE GOVERNANCE STATEMENT
PG 26
DIRECTORS’ REPORT
PG 39
ANNUAL FINANCIAL STATEMENTS
PG 82
INDEPENDENT AUDIT REPORT
PG 84
SHAREHOLDER INFORMATION
PG 86
COMPANY PARTICULARS
FRONT COVER FROM LEFT:
Dr Julia Crossman, Senior Research Scientist
Dr Dharam Paul, Director of Chemistry & CMC
Dr Rajinder Singh, Senior Research Scientist
BIONOMICS IS
DISCOVERING
AND DEVELOPING
INNOVATIVE
THERAPEUTICS
FOR SERIOUS MEDICAL
CONDITIONS, WORKING
WITH PARTNERS TO
ACHIEVE SIGNFICANT
OUTCOMES
FOR PATIENTS,
SHAREHOLDERS
AND EMPLOYEES
Bionomics is a leader in the discovery and development of
innovative biopharmaceuticals with operations in Australia,
Europe and US.
The company undertakes discovery, development and
strategic partnering of first class and best in class drugs
to treat patients with serious medical conditions including
cancer and central nervous system disorders.
Bionomics utilizes key global, strategic partnerships for
the commercialisation of its drugs.
2
HIGHLIGHTS
R VASCULAR DISRUPTING AGENT BNC105 NEARING KEY PARTNERING PHASE
E
C
N
A
C
w w BNC105 Phase I renal cancer trial demonstrates clinical benefit
w w Recruitment for Phase II trial for renal cancer completed
w w Recruitment in Phase I ovarian cancer trial completed
SECURED CANCER STEM CELL PROGRAMS AND RAPIDLY ADVANCING CSC PIPELINE
w w Acquired US oncology franchise Eclipse Therapeutics, advancing cancer stem cell targeting
antibody BNC101
w w Lonza commences manufacture of BNC101 in preparation for clinical trials
CRC COLLABORATION YIELDS FIRST RESULTS
w w Proof of Concept compound identified, reduces tumour size and cancer spread in preclinical
model of melanoma
w w IND application for IW-2143 (BNC210) submitted to the FDA and subsequently a US Phase I clinical
w w A US$2 million milestone payment to Bionomics by Ironwood could be triggered through
M IRONWOOD PARTNERSHIP PROGRESSES BNC210
E
T
S
Y
S
progression of the Phase I program.
trial was commenced by Ironwood.
L
A
R
T
N
E
C
S
U
O
V
R
E
N
BNC375 DRUG CANDIDATE IDENTIFIED FROM ALPHA 7 PROGRAM
w w Potential treatment for cognitive impairment in Alzheimer’s disease, Parkinson’s disease and
other conditions where memory loss occurs
w w Data presented at international and Australian scientific conferences attracts attention from
potential partners
PARTNERSHIP WITH MERCK ON PAIN PROGRAM
w w Bionomics may earn up to US$172 million in option fees and clinical and development milestones
plus royalties on product sales
Kv1.3 PROGRAM DRIVING TOWARDS PARTNERSHIP
w w Data package expanded beyond Multiple Sclerosis to Psoriasis
E
N
U
M
M
I
E
S
A
E
S
D
I
3
CHAIRMAN’S
LETTER
DEAR SHAREHOLDER,
Although I joined Bionomics only late last year, I have been following its progress
with interest since its inception. Over the years I have seen the Company continue
to leverage its core strengths in Cancer, Central Nervous System and Immune
Diseases, developing a deep and valuable pipeline of drug compounds.
WHAT MAKES THE BIONOMICS PIPELINE UNIqUELY VALUABLE ARE FOUR
CORE FACTORS: OUR PEOPLE, OUR PLATFORM TECHNOLOGIES, OUR
PARTNERSHIP STRATEGY AND FINALLY THE GLOBAL FORCES OF CHANGE
TAKING PLACE ACROSS OUR INDUSTRY.
Before I talk about our people
I want to address the pathway
we have chosen and where our
strategy fits in the global context.
Pharmaceutical researcher
EvaluatePharma has estimated that
there are US$290 billion of sales of
big pharma products at risk from
patent expirations between 2012
and 2018. The Bionomics business
model is built on the industry’s
urgent need to replace these drug
compounds, while recognising that
bringing blockbuster drugs through
large scale clinical studies to
market is both costly and inherently
risky. That is why we have pursued
a partnership approach which
allows us to validate the value of
our intellectual property and lay off
risk, as we did with the Ironwood
transaction in FY12 and more
recently with Merck in partnering
our pain program.
To support this strategy, we have
developed a deep, staged pipeline
which offers us a continuing stream
of product candidates giving us
multiple shots on goal. Of course
our ability to replenish the pipeline
is key to securing our future.
At Bionomics the depth of our
world-class science and discovery
platforms are underpinned by a
highly capable team of people lead
by our CEO & Managing Director
Deborah Rathjen who earlier this
year was named BioSpectrum Asia
Person of the Year.
Over the past year we have built on
the global competencies of our team
with the appointment of Dr José
Iglesias to the role of Chief Medical
Officer, Dr Jeremy Simpson as Vice
President Clinical Development and
Dr Forrest Fuller as Vice President
Business Development. We also
welcomed the addition of the team
from Eclipse Therapeutics (Eclipse),
including co-founders Dr Peter
Chu and Dr Chris Reyes, following
its acquisition by Bionomics in
September 2012. Dr Jonathan Lim,
Executive Chairman of Eclipse, also
joined Bionomics’ Board ensuring
continuity as Bionomics implemented
its strategy in the highly promising
area of cancer stem cells
therapeutics. I also congratulate
Dr Sue O’Connor, who has been with
Bionomics now for ten years, for
her promotion to Vice President of
Neuroscience Research.
With achievement of milestones
such as the completion of enrolment
in our Phase II renal cancer trial
and the successful establishment
of operations in San Diego, I believe
that Bionomics has reached a key
inflection point in our development
and that the next twelve months will
see us building on the successes
of our partnership strategy, seen
most recently in the Company’s
partnership with Merck & Co.
Partnering opportunities such
GRAEME KAUFMAN, CHAIRMAN.
as these are only possible when we
make advances in our discovery and
clinical trial programs and build our
pipeline into a portfolio that is of
high value. I am very excited by the
breakthroughs we have made during
the year in the exciting areas of
cancer and central nervous system
therapies and believe that these are
an indication of Bionomics’ strong
pipeline.
With the support of our shareholders
and the raising of an additional
$16.4 million, Bionomics closed
FY13 with $22.45 million in cash and
I believe we are in a strong position
to negotiate with multiple parties
on these compounds.
I would like to thank my fellow
Directors, our CEO Deborah Rathjen
and the entire Bionomics team for
their efforts during the year and also
our shareholders for their continued
commitment to our business.
Yours sincerely,
Graeme Kaufman
Chairman
4
OUR VISION IS TO BECOME
A LEADING PLAYER IN THE
GLOBAL DRUG DISCOVERY
AND DEVELOPMENT
BUSINESS WITH
RECURRENT REVENUE
STREAMS UNDERPINNED
BY OUT-LICENSING
AGREEMENTS AND A
VALUABLE INTELLECTUAL
PROPERTY PORTFOLIO
OF COMPELLING DRUG
CANDIDATES.
DEBORAH RATHJEN
CEO AND MANAGING
DIRECTOR.
CEO &
MANAGING
DIRECTOR’S
REPORT
DEAR SHAREHOLDER,
The 2013 financial year has seen continued focus on building out our deep, staged
pipeline, working with our partner Ironwood Pharmaceuticals to progress IW-2143
(BNC210) and positioning the business to secure additional value creating partnering
opportunities that will lock in future revenue streams. Our vision is to become a leading
player in the global drug discovery and development business with recurrent revenue
streams underpinned by out-licensing agreements and a valuable intellectual property
portfolio of compelling drug candidates.
Bionomics’ strategy to leverage our
core strengths in solid tumour oncology,
central nervous system and immune
disease therapies, has delivered a
valuable portfolio of drug candidates
that target multi-billion dollar market
opportunities across those segments.
During the year we added to that
portfolio, organically via our “in house”
proprietary drug discovery platforms and
development capability as evidenced by
BNC375 the Company’s drug candidate
for Alzheimer’s Disease, as well as by the
acquisition of a pipeline of complementary
oncology assets, via the acquisition of
Eclipse Therapeutics (Eclipse).
We have also added to our team and
this has enabled us to advance our
programs rapidly, to validate our science
and to attract the attention of key
players seeking to fill their own product
pipelines with new drug candidates
like our own. Evidence of this is in the
recently announced partnership with
Merck & Co (known as MSD outside
the US and Canada). On 31 July 2013
Bionomics announced an agreement
to discover and develop novel small
molecule candidates for the treatment
of chronic pain, including neuropathic
pain. Merck is a global pharmaceutical
company and this research collaboration
is validation of Bionomics’ drug discovery
platforms ionX® and MultiCore®. It is
also a further example of the Company’s
partnership strategy. Under the terms
of the agreement, Merck will have the
option to exclusively license a compound
from Bionomics for development
and commercialisation. In return,
Bionomics may receive option exercise
fees and development and regulatory
milestone payments of up to US$172
million. Bionomics may also be eligible
for undisclosed royalties on net sales
of products from the collaboration.
Bionomics retains the right to develop and
commercialise certain compounds for
which Merck does not exercise its option.
The initial period of the research program
will be two years.
During the year Bionomics also
demonstrated its ability to progress the
development of its lead cancer program.
BNC105, Bionomics’ dual acting vascular
disrupting agent for the treatment of solid
tumours reached a significant milestone
with enrolment into the multinational
Phase II clinical trials in patients suffering
metastatic renal cancer and who have
failed prior treatment with tyrosine kinase
inhibitors.
5
CEO &
MANAGING
DIRECTOR’S
REPORT
Yana Kolev, Research Assistant
SECURING A SOLID fINANCIAL UNDERPINNING
From a financial perspective we are pleased to report continued growth in our revenue and other income which is
up 19% over the prior year to $11.83 million. Revenue growth comes from payments that were received under the
Ironwood out-licensing arrangement, contract service fees earned by Neurofit and funds received under the R&D tax
incentive.
We will continue to position the business to receive research and development funding including grants where
available. Having a global business with operations in the US, Europe and Australia provides us with a solid business
development and regulatory platform, but it also brings with it the opportunity to participate in a much deeper pool of
funds allocated to drug discovery programs like our own.
Earlier this year we saw an opportunity to advance our Alzheimer’s drug candidate BNC375 and have been building
a data package that has formed the basis for our discussions with potential partners. Similarly, in cancer stem cells
Bionomics has moved quickly to showcase its BNC101 antibody at major industry events. These initiatives have been
supported by the Company’s raising of $16.4 million in capital from new and existing shareholders earlier this year.
As at 30 June 2013 Bionomics held $22.45 million in cash and we are confident we now have the resources we need
to continue to advance both of those programs and to negotiate lucrative partnership deals with key players when the
time is right. Our immediate partnership priorities are BNC375 and our Kv1.3 programs, and BNC105 once data from
the recently completed Phase II clinical trial is available in early 2014 calendar year.
Looking ahead, future revenues are anticipated from payments received through our out-licensing arrangements with
Ironwood and Merck, contract services fees earned by Neurofit as well as any further upfront or milestone payments
that are secured by way of additional out-licensing arrangements secured for our other compounds.
6
LEVERAGING OUR CORE STRENGTHS INTO POwERfUL PARTNERSHIPS
At Bionomics we have a simple business model:
3 Employ our proprietary drug discovery platforms to advance “first in class” and “best in class” drug compounds
that target multi-billion dollar market opportunities in the pharmaceutical industry;
3 Identify partners with the development, regulatory and commercial capability to take our compounds to market;
3 Secure deals (sometimes in the pre-clinical phase) that will extract cash and deliver shareholder value early out
of the portfolio – without compromising the commercial upside at the back end; and
3 Continuously look for new compounds and candidates that fit with our competitive strengths, and which allow us
to diversify the portfolio and manage risk.
DRUG
DISCOVERY
DRUG
DEVELOPMENT
PARTNERING
» Platform for delivering
new drug candidates
» Propagates pipeline
with multiple shots
on goal
» Targeted clinical
trials
» Lay off risk with
experienced
partners
» Generate revenue
streams to support
discovery programs
Our focussed partnership
strategy around our
drug candidates
and platforms for
drug discovery are key
differentiators we see with
Bionomics and some of our
peers. According to Deloitte
Trendlines, partnering has
significant advantages with
partnered compounds three
times more likely to reach the
market than those that are
unpartnered.
THE PARTNERSHIP EFFECT:
SUCCESS RATES OF PARTNERED VS. UNPARTNERED COMPOUNDS
Partnered compounds are three times more likely to
reach the market than unpartnered compounds.
Success rate is the percentage of compounds entering
Phase I that reached Market in the US or EU.
Data is for compounds that were in clinical development from 1/12/81 through 8/11/12 by 330 biopharmaceutical companies. A partnered compound is a
compound that was part of a Co-Development, Collaboration, Co-Marketing, Co-Promotion, Development or Research License agreement, or a Joint Venture
agreement that involved another biopharmaceutical company. The compound retains the status of partnered asset even though the partnership may have
ended at some point.
Our focus is on our key strengths across cancer, in particular solid tumour oncology, central nervous system and
immune disease therapies. During the year we have made significant progress across each of these areas.
7
CEO &
MANAGING
DIRECTOR’S
REPORT
ONCOLOGY
Both the human and socio-economic cost of solid tumours globally is substantial. According to the World Cancer
Research Fund, there were an estimated 12.7 million cancer cases around the world in 2008, with this number
expected to increase to 21 million by 2030. It is estimated that tens of billions are spent every year on the treatment
of cancerous tumours. Bionomics is presently advancing five programs that target solid tumours that we believe will
provide hope for patients suffering with the disease. Our most advanced compounds are BNC105 and BNC101 and
these represent our key priorities.
BNC105, VASCULAR DISRUPTING AGENT ENTERS kEY PHASE
Renal cell carcinoma is believed to account for approximately 85 per cent
of kidney cancers. Every year approximately 200,000 cases are diagnosed
worldwide, with 55,000 people diagnosed in the US alone. The five year survival
rate for patients with metastatic disease is less than 2 per cent. The cost of
treating the disease is also significant with the market for drugs targeting
renal cell carcinoma estimated at $2.5 billion per annum.
In June, following presentation of
the latest clinical data at ASCO,
Bionomics announced that it
had completed enrolment into a
randomized Phase II clinical trial
testing the combination of BNC105
plus everolimus (Afinitor) to treat
patients with advanced renal
cell carcinoma, the DisrupTOR-1
clinical trial. This is the first and
only randomized trial to test the
combination of an mTOR inhibitor
(Afinitor) with a vascular disrupting
agent (BNC105) in renal cancer.
The enrolment of 139 patients
(surpassing the target enrolment
of 134 patients) into this first
Phase II clinical trial of BNC105
was an important achievement for
Bionomics. It is particularly exciting
to reach this milestone in a trial
which has the potential to create
a new paradigm for the treatment
of renal cancer. We have always
said that we would be looking to
partner this program once we had
sufficient data from our clinical
trials and achieving this milestone
is an important step in the path
to partnership. When the time is
right, we hope to strike a strategic
deal that will allow us to advance
this compound through to market
and deliver new hope to patients
suffering from renal cancer.
Treatment options remain limited
in progressive metastatic renal cell
cancer for patients who have failed
tyrosine kinase inhibitor therapy and
BNC105 has the potential to broaden
treatment options for these patients.
The mechanism of action of BNC105
provides an innovative approach
to the treatment of solid tumours,
including metastatic renal cell
carcinoma, by attacking established
tumour blood vessels. We believe
that there is a strong scientific
rationale for the combination of
BNC105 and Afinitor, as well as
compelling preclinical and Phase I
data that support this approach.
Afinitor and BNC105 work by different
but complementary mechanisms of
action. The vascular disrupting effect
of BNC105 causes hypoxic stress
and Afinitor concurrently blocks the
mTOR driven recovery pathway of
renal tumours.
In pre-clinical trials BNC105 has
demonstrated synergy in combination
with Afinitor, causing significant
tumour shrinkage. The Phase I
component of the renal cancer trial
has also provided encouragement.
Phase I data is indicative of clinical
benefit and sustained therapy, with
patients staying on therapy for up
to 18 months. The combination of
BNC105 and Afinitor was found to
be well tolerated with no dose
limiting toxicities or evidence
of cumulative toxicity. Eight of
the 12 patients achieved disease
stabilization. The median treatment
period across these eight patients
was 11 cycles with each treatment
cycle being three weeks. Dose
related changes in biomarkers
indicative of vascular response
suggest that BNC105 reaches
effective plasma levels.
As mentioned above, completing
enrolment into the trial is an
important step in the path to
partnership. The data from this
trial is anticipated early in calendar
year 2014 and Bionomics, preferred
position is to have a partner for
BNC105 for Phase III trials.
8
BNC101, CANCER STEM
CELL TARGETING ANTIBODY
PREPARING fOR IND & PHASE I
Cancer stem cell (CSC)
targeting is widely viewed as
the next significant advance
in the treatment of cancer.
Companies (US examples
include Verastem, Oncomed
and Stemline Therapeutics)
pursuing this mode of action
are increasingly gaining
investor support and interest.
The global market for CSC
therapies is estimated to grow
to US$8 billion per annum
by 2016, with the market for
cancer antibody therapies
valued at in excess of US$20
billion in 2011.
Bionomics has always sought
to be at the cutting edge of
cancer drug discovery. Given
the importance of cancer stem
cells in both cancer initiation
and cancer recurrence it is
an area that we want to lead.
Not only are cancer stem cells
important in cancer initiation
and recurrence – they are also
highly resistant to both chemo
and radiation therapy.
In September 2012, Bionomics
announced that it had acquired
Eclipse Therapeutics, a
spin out from Biogen Idec
(NADSAq: BIIB) for $10 million
consideration in Bionomics
shares, valued at $0.4176 cents
per Bionomics share. The
programs acquired through
the transaction were the
product of seven years of
investment by Biogen Idec and
included two antibody drug
candidates we now refer to as
BNC101 and BNC102.
Since the acquisition we
have initiated manufacturing
and IND-enabling studies of
BNC101 in preparation for
clinical trial. At the same time
we are compiling a strong data
package on this humanized
antibody and are presenting
our data at key industry events
such as the Molecular Med
TriCon “Targeting Cancer
Stem Cells” Meeting in San
Francisco in February of this
year and again at the 2013
PEGS “Promising New Targets
– Oncology Stream” conference
in Boston in May.
These conferences provide
Bionomics with the opportunity
to highlight the promising
work we are doing in cancer
stem cell research. Preclinical
studies have demonstrated
that BNC101 significantly
reduces CSC frequency and
prevents tumour re-growth
in long term studies. BNC101
increases survival and inhibits
weight loss in a cachectic
colorectal cancer tumour
model. To date BNC101 has not
shown evidence of toxicity in a
preliminary safety analysis.
We look forward to updating
the market on our progress
with a pre-IND submission for
BNC101 before the end of the
2013 calendar year.
The Eclipse acquisition has
also provided Bionomics with
an important strategic base
in the US, the world’s largest
pharmaceutical market,
enhancing our ongoing business
development activities – clearly
an important element to the
successful execution of our
partnering strategy.
BULK
TUMOUR CELLS
CANCER STEM CELLS
CSC
CONVENTIONAL
CANCER THERAPY
CANCER STEM
CELL THERAPY
TUMOUR RELAPSE
TUMOUR REGRESSION
3 THE MISSING LINK IN TREATING
SOLID TUMOURS
3 CSC’S ARE RESISTANT TO
CONVENTIONAL THERAPIES
3 ERADICATING CSC’S MAY PREVENT
RECURRENCE
3 COMPLEMENTS THE BNC105
PROGRAM BY TARGETING THE
“SEEDS” OF CANCER
9
CEO &
MANAGING
DIRECTOR’S
REPORT
MILESTONE ACHIEVED IN COLLABORATION wITH THE CO-OPERATIVE RESEARCH CENTRE fOR CANCER THERAPEUTICS.
In 2007 Bionomics joined a consortium of top Australian research centres to form the Co-operative Research
Centre (CRC) for Cancer Therapeutics. The CRC for Cancer Therapeutics was awarded AU$37.69 million of federal
government funding over seven years to develop new treatments for cancer. Bionomics has been the sole Australian
commercial drug discovery partner of the CRC, which represents another side to our partnership model.
On 16 May Bionomics announced the achievement of a milestone in one of the collaborative programs. A novel
compound, CTx-0357927, suppressed cancer progression as indicated by tumour growth inhibition and number of
identified metastases in an animal model of melanoma. CTx-0357927 is an inhibitor of vascular growth factor
receptor 3 (VEGFR3), a receptor closely linked to the development of lymphatic vessels which act as a conduit for
tumour cells spreading to different sites of the body.
US figures suggest that the overall 5-year survival rate for patients whose melanoma is detected early, before
the tumour has spread to the regional lymph nodes or other organs, is about 98 percent. The survival rate falls to
62 percent when the disease reaches the lymph nodes, and 15 percent when the disease metastasizes to distant
organs. Melanoma is the fourth most common cancer reported in Australia. In 2008, there were 11,057 new cases
of melanoma of the skin in Australia accounting for 9.8 per cent of all new cancers.
Foreground: Annabell Leske, Research Associate Drug Development
Background from left: Chloe Brown, Laboratory Technician, Dr Daniel Inglis, Research Scientist
10
Foreground: Carolyn Coles, Project Manager Neuroscience
Background: Dr Jorgen Mould, Director, Ion Channel Biology & Head, ionX Platform Development
CENTRAL NERVOUS SYSTEM
The market for drugs treating central nervous system
(CNS) diseases is significant and growing. In the US,
anxiety disorders affect 40 million people each year
and while there are therapies available there remains
a significant, unmet need. Global sales for anti-anxiety
drugs alone are estimated to be in excess of US$5
billion per annum and global sales of drugs that treat
depression are more than twice that. At the same
time, more than five million Americans are living with
Alzheimer’s which is estimated to cost that nation in
excess of US$200 billion per annum. Alzheimer’s is
now the sixth leading cause of death in the US.
In CNS, Bionomics has developed a very solid portfolio
of drug candidates which include anti-anxiety compound
IW-2143 (BNC210) out-licensed last year to Ironwood
Pharmaceuticals (NASDAq: IRWD) and BNC375 a
compound targeting treatment for Alzheimer’s and other
related CNS conditions. With the recently announced
partnership with Merck on our pain program, the
validation of Bionomics’ CNS capability is achieving
global recognition.
UPDATE ON IRONwOOD PARTNERSHIP
In December 2012 Bionomics was advised by its licensee
Ironwood Pharmaceuticals Inc. that a Phase I clinical
trial of the investigational anti-anxiety drug candidate
IW-2143 (BNC210) had commenced in the US, following
the November 2012 submission of an IND application to
the US FDA.
The Phase I program is designed to assess the safety
and pharmacokinetics of IW-2143 in healthy volunteers,
using single and multi-dose administration.
This is the first US clinical trial of IW-2143 and
Ironwood is responsible for developing and, if approved,
commercialising IW-2143 and related compounds,
including paying for the costs of clinical development.
A US$2 million milestone payment to Bionomics by
Ironwood could be triggered through progression of
the Phase I program. Pending achievement of certain
development and regulatory milestones, Bionomics
could receive up to US$345 million in upfront and
milestone payments and research funding, as well as
royalties on sales of products incorporating BNC210
and other related compounds.
11
CEO &
MANAGING
DIRECTOR’S
REPORT
DUAL TRACk STRATEGY TO MAxIMIzE VALUE fROM ALzHEIMER’S COMPOUND
Bionomics announced in December 2012 that it had identified a novel compound with promising properties as a
potential new treatment for Alzheimer’s disease. Following validation in preclinical models of memory deficit in
Alzheimer’s, Bionomics formally nominated BNC375 as its drug candidate.
BNC375 is proprietary to Bionomics and employs a mode of action that is showing great promise in the clinic.
BNC375 is a positive allosteric modulator of the α7 nicotinic acetylcholine receptor. This receptor has been identified
as an important target for improvement of memory and learning deficits that occur in Alzheimer’s disease,
Parkinson’s disease and many other conditions.
BNC375 has been found to be effective across a panel of animal models of impaired learning and memory.
To date it has shown no signs of side effects.
Recognising the potential for value creation through partnership for this compound, Bionomics raised an
additional $16.4 million earlier this year to allow it to pursue a dual track strategy for BNC375.
Raising the additional capital ensured the business had a strong balance sheet to enable it to advance the
program and to negotiate a major partnership deal.
BNC375: COMPETITIVE ADVANTAGES *
* Based on data from preclinical animal studies + Published information and Bionomics’ in-house data
characteristicsbionomics bnc375comPetinG aGents +PotentüüRapid onset of actionüûPotentiates endogenous receptor ligandüûPreserve the normal signalling patterns of the receptorüûDo not cause receptor desensitizationüûNo potential for development of toleranceüûSelectivity over other nicotinic receptorsüü 12
PAIN PARTNERSHIP wITH MERCk VALIDATES TECHNOLOGY PLATfORMS
In a significant development post 30 June 2013, Bionomics has formed a partnership with Merck & Co to discover and
develop novel small molecule candidates for the treatment of chronic pain, including neuropathic pain. The initial
period of the research program will be two years. Through partnerships such as this Bionomics is continuing to deliver
on its business model of strategic partnering for the development and commercialisation of selected programs within
its pipeline.
Bionomics is using its ionX® drug discovery platform and MultiCore® chemistry to identify potential drug candidates.
This research collaboration is thus a strong validation of our drug discovery platforms.
As shareholders are aware Bionomics targets very significant market opportunities in each of its drug discovery
programs and the pain market is no exception. The global pain treatment market recorded sales of US$22 billion in
2010. However, as patent expiries loom, the global market value is anticipated by some analysts to contract to US$18.7
billion by 2016. Within the global pain market the neuropathic pain market is expected to grow from US$2.4 billion
in 2010 to reach US$3.6 billion by 2020. (The Pain Outlook to 2013, Scrip Business Insights 2011). Bionomics also
targets areas where patient’s needs may not be adequately addressed. For example current medications used to treat
neuropathic pain have limited effectiveness and it has been estimated that only one in four patients with neuropathic
pain achieve greater than 50% reduction in pain levels. Side-effects of current medications include drowsiness,
somnolence and dizziness.
US $172M PAIN PARTNERSHIP wITH MERCk & CO
Deal further validates ionX® & MultiCore® drug discovery platforms
Value creation through strategic partnering business model
13
CEO &
MANAGING
DIRECTOR’S
REPORT
Dr Anton Grishin, Senior Research Scientist
IMMUNE DISEASE
The global market for immunomodulator drugs is
estimated at US$46.8 billion. Immunomodulators
have the potential to provide effective therapies for
a range of inflammatory indications such as multiple
sclerosis, rheumatoid arthritis, psoriasis and uveitis.
With few therapeutic options for these conditions,
the commercial opportunity for companies that have
effective treatments for these conditions is substantial.
Bionomics Kv1.3 program has enormous potential in
the treatment of immune-related conditions. Since
regaining ownership of the Kv1.3 program from Merck
Serono, Bionomics has continued to advance this
program, building out the data package and positioning
the business to secure another development and
commercial partner. Partnership discussions are
ongoing with a number of companies at this time.
OUTLOOk
I believe the next twelve months will be a watershed
period for the Company as we await the BNC105 clinical
trial results which will position this program for a
strategic partnership. With a very valuable pipeline of
compounds that leverage our core strengths in solid
tumour oncology and central nervous system therapies
we are nearing further key inflection points for the
business as we seek to put additional partnerships in
place. We believe our strategy to partner our programs
will continue to provide us with industry validation for
our compounds, crystallizing the value of our portfolio
and enabling us to secure multiple recurrent revenue
streams from our intellectual property over time. Of
course the recent evidence for this comes from our
partnership with Merck on our pain program.
We are excited about the coming year and look forward
to updating you on our progress.
I would like to extend my thanks to our Board, the
Bionomics team and most of all our shareholders for
their continued support.
Yours sincerely,
Deborah Rathjen
CEO & Managing Director
14
DISCOVERY
PRECLINICAL
PHASE I
PHASE II
LICENSEE / PARTNER
DRUG CANDIDATE /
PROGRAM
CANCER
BNC105
SOLID TUMOURS,
RENAL, OVARIAN,
MESOTHELIOMA
BNC101
CANCER STEM CELLS,
SOLID TUMOURS,
COLON, BREAST,
PANCREATIC
BNC102
CANCER STEM CELLS,
SOLID TUMOURS
VEGFR3
SOLID TUMOURS,
MELANOMA, BREAST
RET
LUNG AND THYROID
CANCERS
CENTRAL
NERVOUS
SYSTEM
BNC210 (IW-2143)
ANXIETY/DEPRESSION
BNC375
COGNITIVE IMPAIRMENT,
ALZHEIMER’S DISEASE,
ADHD, SCHIZOPHRENIA
GABA-A
EPILEPSY
UNDISCLOSED
PAIN
IMMUNE
DISEASE
Kv1.3
PSORIASIS,
MULTIPLE SCLEROSIS,
RHEUMATOID ARTHRITIS
PIPELINE
15
INTELLECTUAL
PROPERTY
PORTFOLIO
Bionomics continues to build a strong patent portfolio covering the key elements of its business.
Through the worldwide Patent Cooperation Treaty (PCT) mechanism, Bionomics and its related companies were
granted 19 patents this financial year, 21 PCT patent applications entered the national and regional phases of
examination and 9 provisional patent applications were filed as indicated below.
NEW PATENT APPLICATIONS GRANTED THIS FINANCIAL YEAR:
GRANTED
PATENT NO.
COUNTRY
TITLE
8217189
United States
of America
Novel chromenone potassium channel blockers and
uses thereof
GRANT DATE
10 July 2012
575685
New Zealand
Novel benzofuran potassium channel blockers and uses
thereof
6 August 2012
2454073
Canada
Mutations in ion channels
28 August 2012
2008307075
Australia
Novel aryl potassium channel blockers and uses thereof
30 August 2012
160125
Singapore
Novel benzofuran potassium channel blockers and uses
thereof
31 August 2012
8278290
8288096
8293737
8309351
8309545
United States
of America
United States
of America
United States
of America
United States
of America
Novel tubulin polymerisation inhibitors
2 October 2012
Diagnostic method for epilepsy
Novel anxiolytic compounds
16 October 2012
23 October 2012
Markers of endothelial cells and uses thereof
13 November 2012
United States
of America
Novel benzofuran potassium channel blockers and uses
thereof
13 November 2012
2074123
Europe
Novel anxiolytic compounds
5 December 2012
589989
New Zealand
Novel potassium channel blockers and uses thereof
11 December 2012
HK1124329
Hong Kong
Substituted benzofurans, benzothiophenes,
benzoselenophenes and indoles and their use as tubulin
polymeristaion inhibitors
4 January 2013
2007304880
Australia
Novel benzofuran potassium channel blockers and user
thereof
24 January 2013
2431891
Canada
Sodium-channel alpha1-subunit and their polypeptides
and their treatment of generalised epilepsy with febrile
seizures plus
29 January 2013
2007332143
Australia
Chemical compounds and processes
21 February 2013
16
GRANTED
PATENT NO.
COUNTRY
TITLE
HK1132268
Hong Kong
Novel anxiolytic compounds
GRANT DATE
3 May 2013
584330
New Zealand Markers of endothelial cells and uses thereof
30 April 2013
2007304881
Australia
Novel chromenone potassium channel blockers and
uses thereof
25 June 2013
NEW PATENT APPLICATIONS FILED THIS FINANCIAL YEAR:
FILED
PATENT NO.
COUNTRIES
TITLE
2012903296
Provisional
2012903295
Provisional
α7 Nicotinic acetylcholine receptor modulators and uses
thereof-I
α7 Nicotinic acetylcholine receptor modulators and uses
thereof-II
13/617317
13/617153
Provisional
Novel anxiolytic compounds (Cont 1)
Provisional
Novel anxiolytic compounds (Cont 2)
61/696511
Provisional
Compounds and methods for treating a disease or
condition
12186384.9
Europe
Novel anxiolytic compounds
12113140.8
Hong Kong
Combination therapy for treating proliferative diseases
12113139.1
Hong Kong
Treatment for macular degeneration
PROGRAM
α7 nAChR
α7 nAChR
Anxiety
Anxiety
Anxiety
Anxiety
BNC105
BNC105
2013900167
Provisional
α7 Nicotinic acetylcholine receptor modulators and uses
thereof
α7 nAChR
2805397
Canada
201180042879.0
China
463/DELNP/2013
India
2013:518910
Japan
Chemical processes for the manufacture of substituted
benzofurans
Chemical processes for the manufacture of substituted
benzofurans
Chemical processes for the manufacture of substituted
benzofurans
Chemical processes for the manufacture of substituted
benzofurans
13/810364
United States
of America
Chemical processes for the manufacture of substituted
benzofurans
11806154.8
Europe
605923
New Zealand
Chemical processes for the manufacture of substituted
benzofurans
Chemical processes for the manufacture of substituted
benzofurans
BNC105
BNC105
BNC105
BNC105
BNC105
BNC105
BNC105
17
INTELLECTUAL
PROPERTY
PORTFOLIO
FILED
PATENT NO.
COUNTRIES
TITLE
PROGRAM
2011279560
Australia
Chemical processes for the manufacture of substituted
benzofurans
61/798926
61/787436
United States
Provisional
Salts, co-crystals and polymers of an anxiolytic
compound
United States
Provisional
Polymorph B of an anxiolytic compound
PCT/AU2013/000497 PCT
Polymorph B of an anxiolytic compound
2013204159
Australia
Polymorph B of an anxiolytic compound
2013202426
Australia
Divisional
Novel anxiolytic compounds
2012222874
Australia
Novel small-molecules as therapeutics
2012222869
Australia
Methods of treating a disease or condition of the central
nervous system
2012253237
Australia
Methods for preparing naphthyridines
2013901443
Provisional
2013-531697
Japan
Divisional
2012212393
Australia
PCT/AU2013/000581 PCT
2013204313
Australia
α 7 Nicotinic acetylcholine receptor modulators and uses
thereof III
Novel anxiolytic compounds
Positive allosteric modulators of the alpha 7 nicotinic
acetycholine receptor and uses thereof
Combination therapy involving a vascular disrupting
agent and an agent which targets hypoxia
Combination therapy involving a vascular disrupting
agent and an agent which targets hypoxia
2012255690
Australia
Amine derivatives as potassium channel blockers
BNC105
BNC210
BNC210
BNC210
BNC210
Anxiety
Anxiety
Anxiety
Anxiety
α7 nAChR
Anxiety
α7 nAChR
BNC105
BNC105
Kv1.3
Overview Of patent pOrtfOliO8 patent applications covering BNC105, related molecules and biomarkers7 patent applications covering BNC210 and its use in the treatment of anxiety and other disorders 8 patent applications covering molecules which inhibit the activity of the Kv1.3 ion channel and the use of these molecules in the treatment of Multiple Sclerosis and other autoimmune disorders2 patent applications covering Parkinson’s Disease and related disorders4 patent applications covering memory enhancement and related disorders5 patent applications covering cancer stem cells and related disorders21 pending patent applications covering discoveries made utilizing Bionomics’ technology platforms 18
BOARD OF
DIRECTORS
MR GRAEME kAUfMAN BSC, MBA
CHAIRMAN, NON-ExECUTIVE DIRECTOR
Mr Kaufman has wide ranging experience across the biotechnology sector, spanning scientific, commercial
and financial areas. His experience with CSL Limited, Australia’s largest biopharmaceutical company included
responsibility for all of their manufacturing facilities, and the operation of an independent business division operating in
the high technology medical device market. As CSL’s General Manager Finance, Mr Kaufman had global responsibility
for finance, strategy development, human resources and information technology. Mr Kaufman has also served as an
executive director of ASX-listed Circadian Technologies and a non-executive director of Amrad Corporation. He was
previously Executive Vice President Corporate Finance with Mesoblast Limited and is currently a non-executive director
of IDT Australia Limited and Cellmid Limited.
DR DEBORAH RATHjEN BSC (HONS), PHD, MAICD, fTSE
CEO AND MANAGING DIRECTOR
A seasoned biotech executive of almost 20 years, Dr Deborah Rathjen joined Bionomics in June 2000 from Peptech
Limited, where she was Manager of Business Development and Licensing. Dr Rathjen was a co-inventor of Peptech’s
TNF technology and leader of the company’s successful defence of its key TNF patents against a legal challenge by
BASF, providing Peptech with a strong commercial basis for licensing negotiations with BASF, Centocor and other
companies with anti-TNF products. Dr Rathjen has significant experience in company building and financing, mergers
and acquisitions, therapeutic product research and development, and business development and licensing. Dr Rathjen
is Chairperson of the AusBiotech Board and in 2004 was awarded the AusBiotech President’s Medal for her significant
contribution to the Australian biotechnology industry. In 2006 she received a Distinguished Alumni Award from
Flinders University, in 2009 the BioSingapore Asia Pacific Woman Entrepreneur of the Year, 2010 Bio Innovation SA
Industry Leader Award and the BioSpectum Asia person of the year 2013.
19
BOARD
OF DIRECTORS
MR TREVOR TAPPENDEN ACA, fAICD
NON-ExECUTIVE DIRECTOR
Mr Tappenden commenced a career as a Non-Executive Director in 2003 after a career with Ernst & Young spanning
30 years. During his time at Ernst & Young Mr Tappenden held a variety of positions including Managing Partner
of the Melbourne Office, member of the Board of Partners, Head of the Victorian Government Services Group and
National Director of the Entrepreneurial Services Division. He holds directorships in various private, government
and not-for-profit organisations and is the Chairman of the Audit and Risk Management Committees of many of those
organisations.
.
DR ERROL DE SOUzA PHD
NON-ExECUTIVE DIRECTOR
Dr De Souza is a leader in the development of therapeutics for treatment of central nervous system (CNS) disorders.
He is currently President and CEO of a leading US company Biodel Inc (Nasdaq: BIOD) and is the former President and
CEO of US biotech companies Archemix Corporation and Synaptic Pharmaceutical Corporation. Dr De Souza formerly
held senior management positions at Aventis and its predecessor Hoechst Marion Roussel Pharmaceuticals, Inc. Most
recently, he was Senior Vice President and Site Head of US Drug Innovation and Approval (R&D), at Aventis, where he
was responsible for the discovery and development of drug candidates through Phase IIa clinical trials for CNS and
inflammatory disorders. Prior to Aventis, he was a co-founder and Chief Scientific Officer of Neurocrine Biosciences
(Nasdaq: NBIX). Dr De Souza has served on multiple editorial boards, National Institutes of Health (NIH) Committees
and is currently a Director of several public and private companies.
DR jONATHAN LIM MD
NON-ExECUTIVE DIRECTOR
Jonathan Lim, MD is Managing Partner of City Hill Ventures, LLC, which he established in 2010 prior to co-
founding Eclipse Therapeutics in early 2011. Dr Lim was formerly President, CEO, and Board Director of Halozyme
Therapeutics, Inc. where he grew the company from five employees and a market value of $5 million in May 2003 to
140 employees and peak market capitalisation of nearly $1 billion during his tenure. Under Dr Lim’s eight years of
leadership, the company went public and raised $300 million from financing and corporate partnerships with Roche
and Baxter, achieved two US FDA approvals, and built a late stage pipeline of two Phase III, two Phase II, and two
Phase I product candidates. Dr Lim’s prior experience includes management consulting at McKinsey, NIH Postdoctoral
Fellowship at Harvard, and general surgery residency at New York Hospital-Cornell. He has BS and MS degrees from
Stanford, MD from McGill and MPH from Harvard.
20
MANAGEMENT
DR jOSÉ IGLESIAS MD
CHIEf MEDICAL OffICER
Dr Iglesias, responsible for clinical development of the Bionomics Oncology pipeline and with Bionomics since
November 2012, is a seasoned medical professional with 22 years global experience in the biopharmaceutical industry.
Prior to joining Bionomics, he spent six years at Celgene Corporation and its wholly owned subsidiary Abraxis
Bioscience as VP of Clinical Development at Celgene with previous roles including CMO and VP of Global Clinical
Development and Medical Affairs at Abraxis. Previously, Dr Iglesias worked in several positions at US pharmaceutical
giant Eli Lilly over 10 years, including his appointment as Oncology Medical Advisor for the Australia and the Asia
Pacific region between 2002 and 2004. A graduate from the Montevideo School of Medicine, Dr Iglesias has been
published more than 50 times and is an active member of ASCO, AACR and ESMO.
MS MELANIE YOUNG BCOM, CA
CHIEf fINANCIAL OffICER AND COMPANY SECRETARY
Ms Young has over 14 year’s experience, with six years in the medical device field, including two years as CFO of
an ASX-listed company covering all facets of the company’s global finance function. In particular, her considerable
commercial experience in listed company reporting requirements, international finances and working capital
management complements the Bionomics team. Ms Young has also gained experience in negotiating distributor
agreements, due diligence, cost reduction strategies and improving operating efficiencies. Previously Ms Young
worked for Deloitte Touche Tohmatsu in the Growth Solutions Division. Ms Young holds a Bachelor of Commerce from
Deakin University and is a Chartered Accountant.
21
CORPORATE
GOVERNANCE STATEMENT
Bionomics Limited (the Company) and the Board are
committed to achieving and applying a high standard
of corporate governance taking into consideration the
Company’s size and the industry in which the Company
operates.
The Company’s Governance framework is consistent with the
Australian Securities Exchange (ASX) Corporate Governance
Council (ASX CGC) guidelines.
The relationship and division of responsibilities between the
Board and other key management personnel is critical to the
Company’s long-term success. The directors are responsible
to the shareholders for the performance of the Company
in both the short and the longer term and for seeking
an appropriate balance between sometimes competing
objectives in determining the best interests of the Company.
Their focus is to enhance the interests of shareholders and to
ensure the Company is properly governed.
Day to day management of the Company’s affairs, including
the implementation of its approved strategy and policy
initiatives, is delegated by the Board to the Chief Executive
Officer and Managing Director and other key management
personnel, except for matters expressly required by law to
be approved by the Board. This delegation process has been
formalised by the documentation of responsibilities between
the Chairman and the Chief Executive Officer and Managing
Director and incorporated into the Board’s charter.
The following corporate governance framework has been
implemented to ensure the highest level of corporate
governance is achieved:
3 establishment of an internal control framework focusing
on key business risks;
3 adoption of a code of professional ethics and conduct
which applies to all directors, officers and employees;
3 implementation of strict policies regarding related
party transactions and the acquisition and disposal
of the Company’s securities by directors, officers and
employees; and
3 adoption of clear reporting and communication policies
and procedures.
A description of the Company’s main corporate governance
practices is set out over. All these practices, unless
otherwise stated, were in place for the entire year.
THE BOARD OF DIRECTORS
The Board of Directors (the Board) operates in accordance
with the broad principles formally set out in its charter
(Board Charter) that is available from the corporate
governance section of the Company website at
www.bionomics.com.au. The Board Charter details the
Board’s composition and responsibilities.
The Board Charter (inter alia) states:
3 the Bionomics’ Board will at all times recognise
its overriding responsibility to act honestly, fairly,
diligently and in accordance with the law in fulfilling
its primary responsibility of looking after the interests
of Bionomics’ shareholders. These interests are well
served by also taking into consideration the interests
of other stakeholders such as employees and affiliated
institutions.
3 the Board is to be comprised of both executive and non-
executive directors with a majority of non-executive
directors.
3 in recognition of the importance of independent views
and the Board’s role in supervising the activities
of management, the majority of the Board must be
independent of management and all directors are required
to bring independent judgement to bear in their Board
decision making.
3 the Board shall undertake an annual Board performance
evaluation to identify any improvements necessary for
both its operations and the Board Charter.
RESpOnSiBiLiTiES Of ThE BOARD
The responsibilities of the Board include:
3 approving the strategic direction, objectives and annual
financial budget of Bionomics and monitoring the
implementation of those strategies and achievement of
those objectives and budget.
3 monitoring compliance with regulatory requirements and
ethical standards.
3 appointing and reviewing the performance of the Chief
Executive Officer and Managing Director and of the
performance of the Chief Executive Officer’s direct
reports in achieving corporate goals.
3 approving announcements to shareholders and the ASX.
3 approving significant third party agreements.
3 issuing shares, options, equity instruments or other
securities.
3 developing Bionomics’ corporate governance procedures,
systems of risk management and internal compliance and
control, codes of conduct (including human resources
policies) and legal compliance.
22
3 approving and monitoring the progress of major capital
expenditure, capital management and acquisitions and
divestures.
3 assessing the composition of the Board and reviewing its
processes and performance.
BOARD MEMBERS
Details of the members of the Board, their experience,
expertise, qualifications, term of office and independence
status are set out in the Directors’ Report under the
heading ‘information on Directors’. At the date of signing
the Directors’ Report there were four non-executive
directors (including the Chairman), all of whom are deemed
independent under the principles set out below and one
executive director.
The Board seeks to ensure that it is cognisant of the state of
development of Bionomics as a company:
3 at any point in time, its membership as a group has
expertise in areas of current and future importance to the
Company as it grows.
3 the size of the Board is conducive to effective discussion
and efficient decision-making.
DiRECTORS’ inDEpEnDEnCE
The Board has adopted specific principles in relation to
directors’ independence. These state that to be deemed
independent, a director must be independent of management
and free of any business or other relationship that could
materially interfere with – or could reasonably be perceived
to materially interfere with – the exercise of their unfettered
and independent judgement.
issues relating to an assessment of the independence of
a director will be determined by reference to the guidance
provided by the ASX CGC guidelines. The Board shall
determine the thresholds of materiality from the perspective
of both the Company and its directors in determining whether
a director maintains his or her independence of mind.
TERM Of OffiCE
The Company’s Constitution specifies that all non-executive
directors must retire from office no later than the third
AGM following their last election, however they may offer
themselves for re-election.
ROLE Of ThE ChAiRMAn AnD ChiEf EXECuTivE OffiCER
AnD MAnAGinG DiRECTOR
The Chairman is responsible for leading the Board, ensuring
directors are properly briefed in all matters relevant to their
role and responsibilities, facilitating Board discussions and
managing the Board’s relationship with the Company’s key
management personnel.
The Chief Executive Officer and Managing Director is
responsible for implementing the Company strategies and
policies.
COMMiTMEnT
Regular Board meetings and reviews of strategy are held
throughout the year to monitor performance against both the
Board approved objectives and the Board’s broad strategic
plan.
The number of meetings of the Company’s Board and of
each Board committee held during the year ended 30 June
2013 and the number of meetings attended by each director
is disclosed in the Directors’ Report under the heading
‘Meetings of Directors’.
it is the Company’s practice to allow its executive director to
accept appointments outside the Company with prior written
approval of the Board.
COnfLiCT Of inTERESTS
All Board members are required as a continuing obligation
to immediately notify the Board in writing of any actual or
potential conflicts of interest or any circumstance that may
affect a Board member’s level of independence.
inDEpEnDEnT pROfESSiOnAL ADviCE
Directors may seek independent professional advice, at the
expense of the Company, on any matter connected with the
discharge of their responsibilities. prior written approval of
the Chairman is required, but this will not be unreasonably
withheld. Copies of this advice will be made available to, and
for the benefit of, all Board members at the discretion of the
Chairman.
pERfORMAnCE ASSESSMEnT
in line with the timetables setting out the adoption of the
ASX CGC guidelines the Board undertakes an annual
self-assessment comparing its performance with the
requirements of the Board Charter. in this process, the
Chairman meets directors individually to assess how Board
performance may be improved.
23
CORPORATE
GOVERNANCE STATEMENT
DivERSiTY
Bionomics has implemented a diversity policy. While the
key focus of the Diversity policy and the ASX Corporate
Governance Council’s recommendations is on promoting the
role of women within organisations, the Company recognises
that other forms of diversity are also important and seeks
to promote and facilitate a range of diversity initiatives
throughout the Company beyond gender diversity including
setting measurable objectives as necessary.
The Board will ensure that appropriate procedures and
measures are introduced and delegated to the Audit and
Risk Management Committee to ensure that the Company’s
diversity commitments are implemented appropriately.
With an extremely limited pool of appropriate candidates
for many roles throughout the organisation, the Company
considers that it would be detrimental to shareholder
interest to recruit on any basis other than merit, as such no
measurable objectives have been established at this time.
Recommendation 3.4 of the principles of ASX listing rules
(Guidance note 9) requires ASX listed entities to disclose
in the Annual Report the proportion of women in the whole
organisation, in senior executive positions and on the Board
at the end of year.
TOTAL
BOARD
SENIOR
EXECUTIVE
OTHER
All Staff
female Staff
59
28
5
1
2
1
52
26
% of total
47%
20%
50%
50%
CORPORATE REPORTING
for each of the half-year and full-year results, the Chief
Executive Officer and Managing Director and Chief financial
Officer are required to make the following certifications to
the Board:
3 that the Company’s financial statements are complete
and present a true and fair view, in all material respects,
of the financial condition and operational results of the
Company and are in accordance with relevant accounting
standards; and
3 that the above statement is founded on a sound system
of risk management and internal compliance and control
which implements the policies adopted by the Board
and that the Company’s risk management and internal
compliance and control are operating efficiently and
effectively in all material respects.
BOARD COMMITTEES
The Board has established one committee to assist in the
execution of its duties and to allow detailed consideration
of complex issues. This committee is the Audit and Risk
Management Committee, which is comprised entirely of non-
executive directors.
All matters determined by the committee are submitted to
the full Board as recommendations for final Board decision.
Minutes of committee meetings are tabled at a subsequent
Board meeting.
There is no formal nomination committee for the Company.
nominations for the Board are considered by the full Board
as part of normal business reviewed by the Board at its
regular meetings.
under the Board Charter, in the event that the Board believes
a new director should be appointed, the Board shall review
the range of skills, experience and expertise currently
existing on the Board in relation to areas of current and
future importance to the Company as it grows. Candidates
are assessed against this review of needs and, where
appropriate, advice is sought from independent search
consultants.
Where the Board appoints a suitable candidate that person
must stand for election at the next AGM of the Company.
notices of meeting for the election of directors comply with
the ASX CGC guidelines.
new directors will be provided with a letter of
appointment setting out the Company’s expectations, their
responsibilities, rights and the terms and conditions of their
appointment.
COMpEnSATiOn COMMiTTEE
Due to the size of the Board, all Compensation Committee
functions are handled by the full Board rather than a
subcommittee.
in this context, the Board decides on remuneration and
incentive policies and practices generally and makes specific
recommendations on remuneration packages and other
terms of employment for executive directors and non-
executive directors.
All key management personnel sign a formal employment
contract at the time of their appointment covering a range
of matters including their duties, rights, responsibilities and
any entitlements on termination. A formal establishment of
annual objectives and subsequent evaluation of performance
including a half-year review is conducted by the Chief
Executive Officer and Managing Director with all key
management personnel who report directly to that position.
24
further information on directors’ and other key management
personnel’s remuneration is set out in the Directors’ Report
and note 23 to the financial statements.
The Compensation Committee previously had responsibility
for reviewing any transactions between the Company and
the directors, or any interest associated with the directors,
to ensure the structure and the terms of the transaction
was in compliance with the Corporations Act 2001 and was
appropriately disclosed. This is now the responsibility of the
full Board.
AuDiT AnD RiSk MAnAGEMEnT COMMiTTEE
The Audit and Risk Management Committee consists of the
following non-executive directors:
3 Mr Trevor Tappenden (Chairman)
3 Mr Graeme kaufman (appointed 18 September 2012)
3 Mr Christopher fullerton (retired 31 December 2012)
Details of the directors’ qualifications and all attendance at
Audit and Risk Management Committee meetings are set out
in the Directors’ Report.
The Audit and Risk Management Committee has its own
charter setting out its role and responsibilities, composition,
structure, membership requirements and the manner in
which the Committee is to operate. This charter is available
on the Company website.
The main responsibilities of the Committee are to:
3 review, assess and recommend the annual and half-year
financial statements to the Board; and
3 assist the Board in fulfilling its oversight responsibilities
through reviewing:
3 the financial reporting process;
3 the system of internal control and management of
risks;
3 the audit process; and
3 the Company’s process for monitoring compliance with
laws and regulations.
included in these responsibilities, the Audit and Risk
Management Committee:
3 reviews the external auditors’ proposed audit scope,
approach and their performance;
3 makes recommendations to the Board regarding the
re-appointment of the external auditors;
3 considers the independence of the external auditors
including the range of non-audit related services provided
by the external auditors to the Company; and
3 ensures the Company establishes an effective Risk
Management policy and ensures compliance.
in fulfilling its responsibilities, the Audit and Risk
Management Committee:
3 receives regular reports from management and external
auditors;
3 reviews whether management is adopting systems and
processes sufficient for a company of Bionomics’ size and
stage of development;
3 reviews any significant disagreements between the
external auditors and management, irrespective of
whether they have been resolved;
3 meets separately with external auditors at least twice a
year without the presence of management; and
3 provides external auditors with a clear line of direct
communication at any time to either the Chairman of the
Audit and Risk Management Committee or the Chairman
of the Board.
The Audit and Risk Management Committee has authority,
within the scope of its responsibilities, to seek any
information it requires from any employee or external party
and to obtain external legal or other professional advice.
EXTERNAL AUDITORS
The Board’s policy is to appoint external auditors who clearly
demonstrate quality and independence. The performance
of the external auditor is reviewed annually by the Audit
and Risk Management Committee which also makes
recommendations to the Board about the appointment
of audit services for subsequent periods, taking into
consideration assessment of performance, existing value
and costs.
Deloitte Touche Tohmatsu were appointed as external
auditor in 2007. Deloitte’s policy is to rotate engagement
partners every five years in line with the requirements of the
Corporations Act 2001.
An analysis of fees paid to the external auditors, including
a breakdown of fees for non-audit services, is provided in
note 26 to the financial statements. it is the policy of the
external auditors to provide an annual declaration of their
independence to both the Audit and Risk Management
Committee and the Board.
The external auditor is requested to attend the Annual
General Meeting (AGM) and be available to answer
shareholder questions about the conduct of the audit and the
preparation and content of the audit report.
25
CORPORATE
GOVERNANCE STATEMENT
RISK ASSESSMENT AND RISK MANAGEMENT
The Board, through the Audit and Risk Management
Committee, is responsible for ensuring there are adequate
policies in relation to risk management, compliance and
internal control systems. in summary, Company policies are
designed to ensure significant strategic, operational, legal,
reputational and financial risks are identified, assessed and
effectively monitored and managed in a manner sufficient for
a company of Bionomics’ size and stage of development to
enable achievement of the Company’s business strategy and
objectives.
The Company’s risk management policies are managed by
the key management personnel and other senior staff. The
policies are reviewed by the Audit and Risk Management
Committee according to a timetable of assessment and
review proposed by that Committee and approved by the
Board.
ENVIRONMENTAL, WORK HEALTH AND SAFETY
MANAGEMENT POLICIES
The Company recognises the importance of work health
and safety (WhS) and is committed to the highest levels
of performance. To help meet this objective, policies have
been established to facilitate the systematic identification of
WhS issues and to ensure they are managed in a structured
manner.
This system allows the Company to:
3 monitor its compliance with all relevant legislation; and
3 encourage employees to actively participate in the
management of WhS issues.
The Company is in full compliance with all necessary
environmental and other licensing requirements required
for its research facilities in Thebarton (South Australia),
San Diego (Bionomics inc) and for neurofit SAS (neurofit) in
france.
CODE OF CONDUCT
in its Board Charter, the Board has recognised its overriding
responsibility to act honestly, fairly, diligently and in
accordance with the law in fulfilling its primary responsibility
of looking after the interests of Bionomics’ shareholders.
The Board believes that the interests of shareholders are
best served by also taking into account the interests of other
stakeholders such as Bionomics’ employees and individuals
engaged in Bionomics’ directed research at Bionomics’
affiliated institutions.
The Board will work to promote and maintain an environment
within Bionomics that establishes these principles as basic
guidelines for all employees.
Bionomics has formalised a code of business conduct and
ethics. A number of policies that relate to business conduct
are in place including harassment prevention and share
trading, with training provided to all employees as new
policies are implemented.
Copies of the share trading policies for directors and
employees are available on the Company’s website.
CONTINUOUS DISCLOSURE AND SHAREHOLDER
COMMUNICATION
The Company has written policies and procedures that focus
on continuous disclosure of any information concerning
the Company that a reasonable person would expect
to have a material effect on the price of the Company’s
securities. These policies and procedures also include
the arrangements the Company has in place to promote
communication with shareholders and encourage effective
participation at AGMs. These policies and procedures are
available on the Company’s website.
The Chief Executive Officer and Managing Director has been
nominated as the person responsible for communications
with the ASX. This role includes responsibility for ensuring
compliance with the continuous disclosure requirements
in the ASX Listing Rules and overseeing and co-ordinating
information disclosure to the ASX, analysts, brokers,
shareholders, the media and the public.
All announcements disclosed to the ASX are posted on the
Company’s website as soon as practical after disclosure
to the ASX. procedures have also been established for
reviewing whether any price sensitive information has been
inadvertently disclosed, and if so, this information is also
immediately released to the market.
All shareholders are entitled to receive a copy of the
Company’s Annual Report. in addition, the Company seeks to
provide opportunities for shareholders to participate through
electronic means. initiatives to facilitate this include making
all Company announcements, details of Company meetings,
press releases for the last three years and financial
statements available on the Company’s website along with
transcripts of the Chairman’s and Chief Executive Officer and
Managing Director’s addresses to the Company’s AGMs.
The website also includes a feedback and information
request mechanism for investors and shareholders via the
Contact us page of the website.
AUSTRALIAN EQUIVALENTS TO INTERNATIONAL
FINANCIAL REPORTING STANDARDS (AIFRS)
The financial statements are prepared in accordance with
AifRS.
26
DIRECTORS’
REPORT
Your directors present their report on the financial
statements of the Group for the year ended 30 June 2013,
comprising the parent entity Bionomics Limited (Bionomics)
and its subsidiaries. in order to comply with the Corporations
Act 2001, the directors report as follows:
DiRECTORS
The following persons were directors of Bionomics during
the period and up to the date of this report:
The consolidated Group’s Statement of financial position
was strengthened by the non-Renounceable Rights issue in
April 2013 raising a net cash inflow of $15.6m.
The cash position at 30 June 2013 was $22,452,089
(2012: $17,336,609).
The financial performance of key operating segments of
Drug discovery, Drug development and Contract services are
included in note 3.
3 Mr Graeme kaufman, non-Executive Chairman
(appointed 18 September 2012)
3 Dr Deborah Rathjen, Chief Executive Officer and
Managing Director
3 Mr Trevor Tappenden, non-Executive Director
3 Dr Errol De Souza, non-Executive Director
3 Dr Jonathan Lim, non-Executive Director
(appointed 14 September 2012)
3 Mr Christopher fullerton (retired 31 December 2012)
The directors held office during the whole of the financial
year and since the end of the financial year unless otherwise
indicated.
pRinCipAL ACTiviTiES
The principal activities of the Group during the period were:
3 to undertake research and development utilising
Bionomics’ proprietary technology platforms with the aim
of identifying and developing therapies to treat cancer and
conditions of the Central nervous System (CnS), including
anxiety, Multiple Sclerosis and epilepsy;
3 to commercialise intellectual property assets; and
3 to identify strategic alliances and project opportunities
capable of increasing shareholder value and of enhancing
the competitive advantage of Bionomics within the
biotechnology industry.
OpERATinG RESuLTS
Consolidated revenue for the year to 30 June 2013 decreased
by 46% to $3,724,169, predominately attributable to the
timing of ironwood pharmaceuticals revenue (collaboration
and milestones) for commercialising BnC210 after licensing
in January 2012. Grant funding and government assistance
for the period was $8,101,787 relating to the Research and
Development (R&D) Tax incentive introduced from 1 July
2011. This compared with revenues of $6,834,709 and grant
funding of $3,102,837 for the year to 30 June 2012. The
operating loss after tax of the Group for the year to 30 June
2013 was $10,001,350 compared with the prior year after tax
loss of $3,136,238.
The acquisition of Eclipse Therapeutics, inc in September
2012 contributed to the increase in intangible assets and the
associated contingent consideration liability estimated in the
Statement of financial position and detailed in note 32.
REviEW Of OpERATiOnS
Bionomics’ business model involves:
3 employing our proprietary drug discovery platforms
to advance “first in class” and “best in class” drug
compounds that target multi-billion dollar market
opportunities in the pharmaceutical industry;
3 identifying partners with the development, regulatory
and commercial capability to take our drug candidates to
market; and
3 securing out-licensing deals that have the potential to
deliver multiple future revenue streams, delivering value
and mitigating risk.
The financial year to 30 June 2013 saw Bionomics Limited
achieve important milestones across its pipeline of drug
candidates and discovery programs:
3 Completion of enrolment in the multinational phase ii
clinical trial of BnC105 in patients with metastatic renal
cancer and the phase i ovarian cancer trial.
The phase ii trial is evaluating the effect of BnC105 in
combination with everolimus (Afinitor) in patients with
progressive metastatic renal cell carcinoma that have
previously progressed on treatment with tyrosine kinase
inhibitors. Afinitor is an mTOR inhibitor used as a treatment
after patients have failed therapy with tyrosine kinase
inhibitors such as Sutent. Afinitor, approved by the fDA for
the treatment of renal cancer in 2009 and marketed by global
pharmaceutical company novartis, had sales of uS$700
million in 2012.
An update on the status of the phase i component of the trial
was provided at the highly regarded oncology conference,
ASCO, in June 2013. in summary, phase i data are indicative
of clinical benefit and sustained therapy, with patients
staying on therapy for up to 18 months.
Bionomics also advised in June that enrolment into the
phase i ovarian cancer clinical trial had also been completed.
it is anticipated that results of these trials will provide the
foundation for a significant licensing deal, in line with the
Company’s business model.
3 identification of BnC375 as the drug candidate to emerge
from the “Alpha 7” program targeting improvement
27
DIRECTORS’
REPORT
of memory through modulation of the α7 nicotinic
acetylcholine receptor.
following announcement of the selection of BnC375 as
Bionomics’ drug candidate for the treatment of memory loss
in December 2013, data on BnC375 was presented at the
33rd Annual Meeting of the Australian neuroscience Society
in february 2013 for the first time. BnC375, which is a
positive allosteric modulator of the α7 nicotinic acetylcholine
receptor, enhances both episodic memory and working
memory and it has equivalent performance in animal models
to that of Donepezil, a pfizer product, marketed as Aricept.
BnC375 has demonstrated a wide therapeutic window
in the preclinical studies conducted to date. This latest
drug candidate to come from the Company’s technology
platform conforms to Bionomics’ focus on developing well
differentiated drug candidates to treat serious conditions
such as Alzheimer’s disease, Schizophrenia and parkinson’s
disease amongst others. With recent setbacks experienced
by global pharmaceutical companies in the development of
new drugs to treat Alzheimers disease, Bionomics believes
that BnC375 has strong partnership potential.
3 progress in moving the cancer stem cell targeting
antibody BnC101 towards clinical trials.
The acquisition of uS-based Eclipse Therapeutics (now
Bionomics inc) in September 2012 has expanded Bionomics’
presence in oncology and positioned the Company as a
leader in the cancer stem cell therapeutic area. Cancer
Stem Cells (CSCs) are a distinct class of cancer cells that
form the root of a tumour. They are the seeds that give rise to
initial tumour formation and if left unchecked they can lead
to tumour recurrence and spread. CSCs are more resistant
to traditional chemotherapy and radiation therapy and the
targeting of cancer stem cells has become a new pathway to
attack cancer.
With BnC101 in inD-enabling studies, Bionomics is on
track to file an investigational new Drug (inD) application
in calendar year 2014, paving the way for clinical
trials. BnC101, a humanised monoclonal antibody, has
demonstrated functional activity against CSCs from primary
colorectal cancer (CRC) patient samples. in preclinical
studies, BnC101 significantly reduces CSC frequency in vivo
and prevents tumour regrowth in long term studies. BnC101
also increases survival and inhibits weight loss in a cachectic
CRC tumour model. To date BnC101 has shown no evidence
of toxicity in preliminary safety analyses. BnC101 has been
highlighted at several international conferences including
Molecular Medicine TriCon “Targeting Cancer Stem Cells” in
february 2013.
3 Achievement of proof-of-concept milestone by a
compound from Bionomics’ collaboration with the
Co-operative Research Centre for Cancer Therapeutics.
A novel compound, CTx-0357927, suppressed cancer
progression as indicated by tumour growth inhibition and
number of identified metastases in an animal model of
melanoma. CTx-0357927 is an inhibitor of vascular growth
factor receptor 3 (vEGfR3), a receptor closely linked to the
development of lymphatic vessels which act as a conduit for
tumour cells spreading to different sites of the body.
uS figures suggest that the overall 5-year survival rate for
patients whose melanoma is detected early, before the tumour
has spread to the regional lymph nodes or other organs is
about 98 per cent. The survival rate falls to 62 per cent when
the disease reaches the lymph nodes and 15 per cent when
the disease metastasises to distant organs. Melanoma is the
fourth most common cancer reported in Australia. in 2008,
there were 11,057 new cases of melanoma of the skin in
Australia accounting for 9.8 per cent of all new cancers.
3 new data has been generated to support the licensing
of Bionomics kv1.3 program for additional indications,
particularly for psoriasis.
3 Our European subsidiary, neurofit continued to expand
its service offering to customers, securing an additional,
new, global pharmaceutical company for its contract
research business as well as servicing Bionomics’
internal drug discovery programs.
3 in addition to these internal achievements our partner,
ironwood pharmaceuticals, initiated a phase i clinical trial
of BnC210 (iW-2143) in the uS.
On 31 July 2013 Bionomics announced an agreement with
Merck, known as MSD outside the united States and Canada,
to discover and develop novel small molecule candidates for
the treatment of chronic pain, including neuropathic pain.
Merck is a global pharmaceutical company and this research
collaboration is validation of Bionomics drug discovery
platforms ionX® and MultiCore®. it is also a further example
of the Company’s partnership strategy. under the terms
of the agreement, Merck will have the option to exclusively
license a compound from Bionomics for development and
commercialisation. in return, Bionomics may receive option
exercise fees and development and regulatory milestone
payments of up to uS$172 million. Bionomics may also be
eligible for undisclosed royalties on net sales of products
from the collaboration. Bionomics retains the right to
develop and commercialise certain compounds for which
Merck does not exercise its option. The initial period of the
research program will be two years.
The development of new drugs to treat serious illnesses is an
inherently risky process. not all drug candidates will reach
market and it is through its “multiple shots on goal” strategy
of having a number of drug candidates in the pipeline,
licensed to partners with experience in taking new drugs
through the complex regulatory process to market that
Bionomics is balancing the risk whilst maximising value.
28
OuTLOOk
it is anticipated that a number of important R&D milestones
will be achieved in fY14 including release of the phase ii
results of the clinical trial of BnC105 in metastatic renal
cancer, a key ingredient in our partnership strategy for
this drug candidate and the progression of the cancer
stem targeting antibody BnC101 towards clinical trial in
cancer patients. Bionomics will also focus on the continued
execution of its partnership strategy across its pipeline
of drug candidates with BnC375, for the treatment of
cognitive impairment in Alzheimers disease and parkinson’s
disease and BnC164 from the kv1.3 autoimmune diseases
program, the subject of ongoing discussions. We will place
considerable emphasis on alliance management, working
with our current partners ironwood, Merck and the
Cooperative Research Centre for Cancer Therapeutics in
addition to prospective new partners, to deliver value for our
shareholders.
DiviDEnDS
The directors do not propose to make any recommendation
for dividends for the current financial year. There were no
dividends declared in respect of the previous financial year.
SiGnifiCAnT ChAnGES in ThE STATE Of AffAiRS
There were no significant changes in the state of affairs of
the Group during the financial year.
SuBSEquEnT EvEnTS
no matters or circumstances have arisen since the end of the
financial year which significantly affect or may significantly
affect the results of the operations of the Group, except as
noted below.
On 31 July 2013 Bionomics announced an agreement with
Merck, known as MSD outside the united States and Canada,
to discover and develop novel small molecule candidates
for the treatment of chronic pain. Merck will have the option
to exclusively license a compound from Bionomics for
development and commercialisation. in return, Bionomics
may receive option exercise fees and development and
regulatory milestone payments of up to uS$172 million.
Bionomics may also be eligible for undisclosed royalties on
net sales of products from the collaboration.
LikELY DEvELOpMEnTS AnD EXpECTED RESuLTS
Of OpERATiOnS
The Group will continue to undertake drug discovery and
will seek to commercialise the outcomes of its research and
development in the form of diagnostic products and drugs for
the treatment of disease.
EnviROnMEnTAL REGuLATiOn
The Group is subject to environmental regulations and other
licenses in respect of its research facilities in Thebarton
(South Australia), Bionomics inc in San Diego (uSA) and
for neurofit in Strasbourg (france). The Group is subject
to regular inspections and audits by responsible State and
federal authorities. The Group was in compliance with all
the necessary environmental regulations throughout 2012 -
2013 and no related issues have arisen since the end of the
financial year to the date of this report.
INFORMATION ON DIRECTORS
Mr Graeme Kaufman
Chairman - non-Executive Director
Director since 18 September 2012
Experience and Expertise
Mr kaufman has wide ranging experience across the
biotechnology sector, spanning scientific, commercial and
financial areas. his experience with CSL Limited, Australia’s
largest biopharmaceutical company included responsibility
for all of their manufacturing facilities, and the operation
of an independent business division operating in the high
technology medical device market. As CSL’s General
Manager finance, Mr kaufman had global responsibility
for finance, strategy development, human resources and
information technology. Mr kaufman has also served as
an executive director of ASX-listed Circadian Technologies
and a non-executive director of Amrad Corporation. he was
previously Executive vice president Corporate finance with
Mesoblast Limited and is currently a non-executive director
of iDT Australia Limited and Cellmid Limited.
Current Directorships (in addition to Bionomics Limited)
Listed: non-Executive Director, Cellmid Limited (ASX:CDY)
(since August 2012); non-Executive Director, iDT Limited
(ASX:iDT) (since June 2013)
Former Listed Directorships in Last Three Years
none
Special Responsibilities
Member of Audit and Risk Management Committee
Interests in Shares and Options at Date of Report
178,750 ordinary shares in Bionomics Limited
500,000 unlisted options over ordinary shares in Bionomics
Dr Deborah Rathjen BSc (Hons), MAICD, PhD
Chief Executive Officer and Managing Director
Director since 18 May 2000
Experience and Expertise
Dr Rathjen joined Bionomics in 2000 from peptech Limited,
where she was general manager of business development
and licensing. Dr Rathjen was a co-inventor of peptech’s
Tnf technology and leader of the company’s successful
defence of its key Tnf patents against a legal challenge by
BASf. Dr Rathjen has significant experience in research,
business development and licensing and specific expertise
in inflammation and cancer. Dr Rathjen is Chairperson of the
AusBiotech Board.
29
DIRECTORS’
REPORT
Current Directorship (in addition to Bionomics Limited)
Listed: nil
Other: Director and Chairperson of AusBiotech Limited
(since 2008)
Former Listed Directorships in Last Three Years
none
Special Responsibilities
Chief Executive Officer and Managing Director
Interests in Shares and Options at Date of Report
1,965,401 ordinary shares in Bionomics Limited
2,755,000 unlisted options over ordinary shares in
Bionomics Limited
Mr Trevor Tappenden CA, FAICD
non-Executive Director
Director since 15 September 2006
Experience and Expertise
Mr Tappenden commenced a career as a non-Executive
Director in 2003 after a career with Ernst & Young spanning
30 years. During his time at Ernst & Young Mr Tappenden
held a variety of positions including Managing partner of the
Melbourne Office, member of the Board of partners, head
of the victorian Government Services Group and national
Director of the Entrepreneurial Services Division. he holds
directorship in various private, government and not-for-
profit organisations and is the Chairman of the Audit and Risk
Management Committees of many of those organisations.
Current Directorships (in addition to Bionomics Limited)
Listed companies: nil
Other: Director, Buckfast pty Ltd; Director, Advanced
Manufacturing CRC; Director, intellicomms pty Ltd;
Director, RMiT university vietnam; Director (Chairman),
RMiT university foundation
Former Listed Directorships in Last Three Years
Director, Metal Storm Limited
Special Responsibilities
Chairman of Audit and Risk Management Committee
Interests in Shares and Options at Date of Report
247,500 ordinary shares in Bionomics Limited
400,000 unlisted options over ordinary shares in
Bionomics Limited
Dr Errol De Souza
non-Executive Director
Director since 28 february 2008
Experience and Expertise
Dr De Souza is a leader in the development of therapeutics
for treatment of central nervous system (CnS) disorders.
he is currently president and CEO of leading uS company
Biodel inc (nasdaq:BiOD) and is the former president
and CEO of uS biotech companies Archemix Corporation
and Synaptic pharmaceutical Corporation. Dr De Souza
formerly held senior management positions at Aventis and
its predecessor hoechst Marion Roussel pharmaceuticals,
inc. Most recently, he was Senior vice president and Site
head of uS Drug innovation and Approval (R&D), at Aventis,
where he was responsible for the discovery and development
of drug candidates through phase iia clinical trials for CnS
and inflammatory disorders. prior to Aventis, he was a co-
founder and Chief Scientific Officer of neurocrine Biosciences
(nasdaq:nBiX). Dr De Souza has served on multiple editorial
boards, national institutes of health (nih) Committees and is
currently a Director of several public and private companies.
Current Directorships (in addition to Bionomics Limited)
Listed companies: Director of Biodel inc (nasdaq:BiOD),
Director of Targacept, inc (nasdaq:TRGT)
Former Listed Directorships in Last Three Years
Director of palatin Technologies, inc (Amex:pTn);
Massachusetts Biotechnology Council
Special Responsibilities
none
Interests in Shares and Options at Date of Report
116,698 ordinary shares in Bionomics Limited
500,000 unlisted options over ordinary shares in
Bionomics Limited
Dr Jonathan Lim
non-Executive Director
Director since 14 September 2012
Experience and Expertise
Jonathan Lim, MD is Managing partner of City hill ventures,
LLC, which he established in 2010 prior to co-founding
Eclipse in early 2011. Dr Lim was formerly president, CEO
and Board Director of halozyme Therapeutics, inc where
he grew the company from five employees and a market
value of $5 million in May 2003 to 140 employees and peak
market capitalisation of nearly $1 billion during his tenure.
under Dr Lim’s eight years of leadership, the company went
public and raised $300 million from financing and corporate
partnerships with Roche and Baxter, achieved two uS fDA
approvals and built a late stage pipeline of two phase iii, two
phase ii and two phase i product candidates. Dr Lim’s prior
experience includes management consulting at Mckinsey,
nih postdoctoral fellowship at harvard and general surgery
residency at new York hospital-Cornell. he has BS and
MS degrees from Stanford, MD from McGill and Mph from
harvard.
Current Directorships (in addition to Bionomics Limited)
Listed companies: nil
Other: Managing partner, City hill ventures, LLC
Former Listed Directorships in Last Three Years
president, halozyme Therapeutics, inc (nasdaq:hALO)
Special Responsibilities
none
Interests in Shares and Options at Date of Report
4,073,463 ordinary shares in Bionomics Limited
500,000 unlisted options over ordinary shares in
Bionomics Limited
30
COMpAnY SECRETARY
The Company Secretary is Ms Melanie Young. Ms Young
was appointed to the position of Company Secretary and
Chief financial Officer in May 2011. Ms Young has over 14
years’ experience, with six years in the medical device
field, including two years as CfO of an ASX-listed company
covering all facets of the company’s global finance function.
Ms Young has considerable commercial experience in listed
company reporting requirements, international finances and
working capital management. Ms Young has also gained
experience in negotiating distributor agreements, due
diligence, cost reduction strategies and improving operating
efficiencies. previously Ms Young worked for Deloitte Touche
Tohmatsu in the Growth Solutions Division. Ms Young holds
a Bachelor of Commerce from Deakin university and is a
Chartered Accountant.
MEETinGS Of DiRECTORS
The numbers of meetings of the Company’s Board and of
each Board committee held during the year ended 30 June
2013, and the numbers of meetings attended by each director
were:
MEETINGS
OF AUDIT
AND RISK
MANAGEMENT
(ARM)
COMMITTEE
MEETINGS OF
DIRECTORS
A
9
12
12
12
9
6
B
9
12
12
12
9
6
A
2***
**
4
**
**
2
B
2
**
4
**
**
2
Mr Graeme kaufman
Dr Deborah Rathjen*
Mr Trevor Tappenden
Dr Errol De Souza
Dr Jonathan Lim
Mr Christopher fullerton
A number of meetings held during the time the director
held office or was a member of the committee during
the year and was entitled to attend.
B number of meetings attended.
*
** not a member of the relevant committee, may attend by
not a non-executive director.
invitation.
*** Mr kaufman attended an additional meeting prior to
being appointment to the ARM Committee.
REMUNERATION REPORT
The remuneration report is set out under the following main
headings:
1. pRinCipLES uSED TO DETERMinE ThE nATuRE AnD
AMOunT Of REMunERATiOn
2. DETAiLS Of REMunERATiOn
3. SERviCE AGREEMEnTS
4. ShARE-BASED COMpEnSATiOn
5. ADDiTiOnAL infORMATiOn
1. pRinCipLES uSED TO DETERMinE ThE nATuRE AnD
AMOunT Of REMunERATiOn
The objective of the Group’s key management personnel
remuneration framework is to ensure that reward for
performance is competitive and appropriate for the
results delivered. The framework aligns key management
personnel rewards with achievement of strategic
objectives and the creation of value for shareholders.
key management personnel remuneration and other
terms of employment are determined by the Board having
regard to performance, relevant comparative information
and the Group’s financial performance.
Remuneration packages are set at levels that are
intended to attract and retain first class key management
personnel capable of managing the Group’s operations
and achieving the Group’s strategic objectives.
The framework provides a mix of base cash remuneration
and performance-based remuneration through the
Bionomics Limited Employee Share Option plan (the
Bionomics ESOp) in order to align the interests of key
management personnel with those of shareholders.
Non-Executive Directors
fees and payments to non-executive directors reflect the
demands that are made on and the responsibilities of the
directors.
non-executive directors may receive share options at the
time of their initial appointment to the Board or at other
such times as approved by shareholders.
Directors’ Fees
non-executive directors’ fees are determined within an
aggregate directors’ fee pool limit that is periodically
recommended for approval by shareholders under the
Constitution. The current aggregate non-executive
directors’ fee pool limit is $500,000 per annum (as
approved by shareholders at the AGM held on 14
november 2012). The Chairman and non-executive
directors’ fees are $120,000 per annum and $65,000 per
annum respectively, inclusive of superannuation. The
Chairman of the Audit and Risk Management Committee,
31
DIRECTORS’
REPORT
Mr Trevor Tappenden, received an additional $15,000 per
annum inclusive of superannuation for services relating
to his Audit and Risk Management Committee duties. Dr
Errol De Souza received an additional $15,000 per annum
inclusive of superannuation for being a member of the
Scientific Advisory Board.
Any value that may be attributed to options issued to
non-executive directors is not included in the shareholder
approved aggregate limit of directors’ fees applying from
time to time.
Retirement Allowance for Directors
The Group does not provide retirement allowances for its
non-executive directors.
Key Management Personnel Remuneration
The key management personnel pay and reward
framework has three components:
3 a cash remuneration package, including
superannuation and other entitlements;
3 longer-term incentives through participation in the
Bionomics ESOp; and
3 in exceptional circumstances, a cash bonus may be
paid.
The combination of these comprises the key management
personnel’s total remuneration.
Base Remuneration
The cash remuneration package of key management
personnel is structured as a total employment cost
package that may be delivered as a mix of cash
and prescribed salary sacrifice benefits at the key
management personnel’s discretion, inclusive of
superannuation or equivalent retirement benefits.
Remuneration levels are reviewed annually and an
assessment made against market comparable roles
balanced with individual key management personnel’s
performance and the Group’s financial position. The key
management personnel’s remuneration may also be
reviewed on promotion. The Board reviews and approves
the salary of the Chief Executive Officer and Managing
Director and other key management personnel directly
reporting to the Chief Executive Officer and Managing
Director.
There is no link between the company’s performance and
the setting of remuneration except as discussed on page
36 in relation to options and cash bonuses for certain
executives.
There are no guaranteed base pay increases for key
management personnel.
Retirement Benefits
Retirement benefits through superannuation (or local
equivalent) are paid for all Group employees in line with
relevant legislative requirements into funds nominated
by the individual employee. The Group does not have
any on-going responsibility for the individual employee
superannuation and does not have in place a defined
benefits plan for employees in Australia.
The Bionomics ESOP
information on the Bionomics ESOp is set out in section 4
of this Remuneration Report.
2. DETAiLS Of REMunERATiOn
Details of the remuneration of each director of Bionomics
and each of the other key management personnel (as
defined in the Corporations Act 2001) are set out in the
following tables.
Non-Executive Chairman
Mr Graeme kaufman (appointed 18 September 2012)
Executive Director
Dr Deborah Rathjen, Chief Executive Officer and Managing
Director
Non-Executive Directors
Mr Trevor Tappenden
Dr Errol De Souza
Dr Jonathan Lim (appointed 14 September 2012)
Mr Christopher fullerton (retired 31 December 2012)
32
The following persons were the key company and group executives and those persons having authority and responsibility
for planning, directing and controlling the activities of the consolidated entity, directly or indirectly, including any director
(whether executive or otherwise) of the consolidated entity (key Management personnel) during the financial year and the
prior year unless otherwise stated:
Name
Dr Deborah Rathjen
Dr José iglesias
Ms Melanie Young
Position
Chief Executive Officer and Managing Director
Chief Medical Officer (appointed 1 november 2012)
Chief financial Officer and Company Secretary
Details of options granted by Bionomics to and exercised by directors, other key management personnel and the five highest
remunerated officers during the year ended 30 June 2013 are set out further in this report.
DIRECTORS AND OTHER KEY MANAGEMENT PERSONNEL – 2013
SHORT-TERM BENEFITS
CASH
SALARY
AND FEES
$
NON-
MONETARY
BENEFITS
$
78,249
48,739
73,395
80,000
51,458
419,820
270,330
156,047
1,178,038
-
-
-
-
-
53,710
-
13,678
67,388
NAME
Mr Graeme kaufman3
Mr Christopher fullerton5
Mr Trevor Tappenden
Dr Errol De Souza
Dr Jonathan Lim2
Dr Deborah Rathjen1
Dr José iglesias4
Ms Melanie Young
TOTALS
POST
EMPLOYMENT
SHARE-BASED PAYMENTS
SUPERANNUATION
$
SHARES
$
OPTIONS
$
OPTIONS
% OF
TOTAL
%
16.25
23.79
-
1.26
24.34
TOTAL
$
101,842
69,711
80,000
81,024
68,009
16,551
16,586
-
1,024
16,551
(8,255)
(1.71)
481,745
2,398
51,170
96,025
0.88
21.67
272,728
236,170
6.90
1,391,229
7,042
4,386
6,605
-
-
16,470
-
15,275
49,778
-
-
-
-
-
-
-
-
-
12013 includes the reversal of the estimated fair value of options at 30 June 2013 ($48,900) and the actual fair value at vesting
date 15 August 2012 of $33,300. 2Appointed 14 September 2012. 3Appointed 18 September 2012. 4Appointed 1 november 2012.
5Retired 31 December 2012.
DIRECTORS AND OTHER KEY MANAGEMENT PERSONNEL – 2012
SHORT-TERM BENEFITS
CASH
SALARY
AND FEES
$
NON-
MONETARY
BENEFITS
$
100,917
68,807
75,000
398,600
147,443
790,767
-
-
-
60,625
8,520
69,145
POST
EMPLOYMENT
SHARE-BASED PAYMENTS
SUPERANNUATION
$
SHARES
$
OPTIONS
$
OPTIONS
% OF
TOTAL
%
TOTAL
$
9,083
6,193
-
15,775
14,037
45,088
-
-
-
-
28,659
20.67
138,659
1,022
4,243
1.34
5.35
76,022
79,243
140,963
22.88
615,963
1,000
31,341
15.49
202,341
1,000
206,228
18.54
1,112,228
NAME
Mr Christopher fullerton
Mr Trevor Tappenden
Dr Errol De Souza
Dr Deborah Rathjen6
Ms Melanie Young
TOTALS
6Dr Rathjen’s options expense for services performed during the year includes an estimate at 30 June 2012 of the fair value of
options granted in August 2012 relating to the commercialisation incentive options approved at the 2011 AGM.
33
DIRECTORS’
REPORT
Options are granted to directors and other key
management personnel under the Bionomics ESOp,
details of which are set out in section 4 of this
Remuneration Report.
no director or senior management person appointed
during the period received a payment as part of their
consideration for agreeing to hold the position.
3. SERviCE AGREEMEnTS
Remuneration and other terms of employment for the
Chief Executive Officer and Managing Director and the
other key management personnel are formalised in
service agreements. Major provisions of the agreements
relating to remuneration are set out below:
Dr Deborah Rathjen
Chief Executive Officer and Managing Director
3 Term of agreement – 5 years commencing 15 October
2010.
3 Total remuneration package for the year ended 30 June
2013 of $490,000 per annum (excluding options), to be
reviewed annually by the Board.
3 payment of termination benefit on early termination
by the employer without cause equal to six months’
salary. in the event of redundancy, purchase or merger
of Bionomics by a third party resulting in a material
diminution in duties, an additional six months’ salary
will be paid.
Dr José Iglesias
Chief Medical Officer
3 Term of agreement – open, commencing 1 november
2012.
3 Total remuneration package for the year ended 30 June
2013 of $405,495 per annum, pro-rated (excluding
options) to be reviewed annually by the Chief Executive
Officer & Managing Director and approved by the
Board.
3 payment of termination benefit on early termination
by the employer without cause equal to three months’
salary. in the event of redundancy, purchase or merger
of Bionomics by a third party resulting in a material
diminution in duties, six months’ salary will be paid.
Ms Melanie Young
Chief financial Officer and Company Secretary
3 Term of agreement – open, commencing 9 May 2011.
3 Total remuneration package for the year ended
30 June 2013 of $185,000 per annum (excluding options
and shares) to be reviewed annually by the Chief
Executive Officer and Managing Director and approved
by the Board.
3 payment of termination benefit on early termination
by the employer without cause equal to three months’
salary. in the event of redundancy, purchase or merger
of Bionomics by a third party resulting in a material
diminution in duties, six months’ salary will be paid.
4. ShARE-BASED COMpEnSATiOn
Share-based compensation benefits are provided to
employees via the Bionomics ESOp and an Employee
Share plan.
The market value of shares issued to employees for
no cash consideration under the Employee Share plan
is recognised as an employee benefits expense with a
corresponding increase in equity when the employees
become unconditionally entitled to the shares.
The Bionomics ESOp was approved by the Board and
Shareholders in 2011. Staff eligible to participate in the
plan are those who have been a full-time or part-time
employee of the Group for a period of not less than six
months or a director of the Company.
Options are granted under the plan for no consideration
and vest equally over five years, unless they are bonus
options which vest immediately.
The amounts disclosed as remuneration relating to
options are the assessed fair values at grant date of those
options allocated equally over the period from grant date
to vesting date. fair values at grant date are independently
determined using a Black-Scholes option pricing model
that takes into account the exercise price, the term of the
option, the vesting and performance criteria, the impact
of dilution, the non-tradeable nature of the option, the
share price at grant date, expected price volatility of the
underlying share, the expected dividend yield and the risk-
free interest rate for the term of the option.
The terms and conditions of each grant of options
affecting remuneration of directors, other key
management personnel and any of the top five salaried
officers in this or future reporting periods appear on the
following page:
34
FAIR VALUE
PER OPTION AT
GRANT DATE
VESTING DATE
$0.1211
16 november 2008
$0.1264
$0.1307
$0.1343
$0.0875
$0.0963
$0.1042
$0.1114
$0.1178
$0.0737
$0.0828
$0.0915
$0.0993
16 november 2009
16 november 2010
16 november 2011
5 november 2008
5 november 2009
5 november 2010
5 november 2011
5 november 2012
5 november 2008
7 August 2009
7 August 2010
7 August 2011
$0.1527
25 november 2011
$0.0333
$0.2344
$0.2487
15 August 2012
12 December 2012
12 December 2013
$0.2611
12 December 2014
$0.2720
$0.2818
12 December 2015
12 December 2016
$0.0942
$0.1130
$0.1226
$0.1310
$0.1383
$0.1449
$0.1509
$0.1425
$0.1525
$0.1614
$0.1696
$0.1768
1 August 2012
11 December 2012
11 December 2013
11 December 2014
11 December 2015
11 December 2016
11 December 2017
5 June 2014
5 June 2015
5 June 2016
5 June 2017
5 June 2018
GRANT DATE
EXPIRY DATE
EXERCISE PRICE
Granted in prior periods
November 2006
November 2008
November 2011
December 2011
Granted in current period
August 2012
December 2012
June 2013
16 november 2013
16 november 2014
16 november 2015
16 november 2016
5 november 2013
5 november 2014
5 november 2015
5 november 2016
5 november 2017
5 november 2013
7 August 2014
7 August 2015
7 August 2016
25 november 2016
25 november 2016
12 December 2017
12 December 2018
12 December 2019
12 December 2020
12 December 2021
1 August 2017
11 December 2017
11 December 2018
11 December 2019
11 December 2020
11 December 2021
11 December 2022
5 June 2019
5 June 2020
5 June 2021
5 June 2022
5 June 2023
Options granted under the plan carry no dividend or voting rights.
$0.30
$0.30
$0.30
$0.30
$0.30
$0.30
$0.30
$0.30
$0.30
$0.3716
$0.3716
$0.3716
$0.3716
$0.614
$0.921
$0.518
$0.518
$0.518
$0.518
$0.518
$0.287
$0.287
$0.32
$0.32
$0.32
$0.32
$0.32
$0.3873
$0.3873
$0.3873
$0.3873
$0.3873
35
DIRECTORS’
REPORT
OpTiOnS pROviDED AS REMunERATiOn unDER ThE ESOp in ThE CuRREnT YEAR
Details of options over ordinary shares in the Company provided as remuneration to each director and each of the other key
management personnel are set out below. When exercisable, each option is convertible into one ordinary share of Bionomics.
During the year, and since the end of the year, options were issued to the following directors and other key management
personnel:
NAME
NUMBER
GRANTED
DATE
GRANTED
TOTAL FAIR
VALUE $
NUMBER
VESTED
% OF GRANT
VESTED
% OF GRANT
FORFEITED
Dr Deborah Rathjen1
65,000
11 Dec 2012
Dr Deborah Rathjen2
1,000,000
25 nov 2011
Ms Melanie Young1
75,000
1 Aug 2012
Mr Graeme kaufman3
500,000
11 Dec 2012
Dr Jonathan Lim3
Dr José iglesias3
500,000
11 Dec 2012
500,000
5 Jun 2013
7,345
33,300
7,065
68,769
68,769
80,280
65,000
1,000,000
75,000
-
-
-
100%
100%
100%
-
-
-
-
-
-
-
-
-
1The options vested immediately.
2The options were issued in november 2011 and vested after the end of the financial year after successful achievement of
agreed major partnering deal milestone. The fair value was estimated at 30 June 2013 and the final fair value calculated at
the vesting date of 15 August 2012.
3The options vest after completion of a specified service period.
OpTiOnS EXERCiSED in ThE CuRREnT YEAR
During the year, the following directors and other key management personnel exercised options that were granted to them as
part of their compensation. Each option converts into one ordinary share of Bionomics.
NAME
NUMBER OF OPTIONS
EXERCISED
NUMBER OF ORDINARY
SHARES ISSUED
AMOUNT PAID
$
AMOUNT UNPAID
$
Dr Deborah Rathjen
430,000
430,000
70,300
-
The following table summarises the value of options granted, exercised or lapsed during the financial year to directors and
other key management personnel:
NAME
Dr Deborah Rathjen
Ms Melanie Young
Mr Trevor Tappenden
Mr Graeme kaufman
Dr Jonathan Lim
Dr José iglesias
VALUE OF OPTIONS GRANT
AT THE GRANT DATE1
$
VALUE OF OPTIONS EXERCISED
AT THE EXERCISE DATE
$
VALUE OF OPTIONS LAPSED
AT THE DATE OF LAPSE2
$
7,345
7,065
-
68,769
68,769
80,280
81,100
-
-
-
-
-
-
-
(11,470)
-
-
-
1The value of options granted during the period is recognised in compensation over the vesting period of the grant, in
accordance with Australian Accounting Standards.
2The value of options lapsing during the period due to the failure to satisfy a vesting condition is determined assuming the
vesting condition has been satisfied.
36
5. ADDiTiOnAL infORMATiOn
Principles Used to Determine the Nature and Amount of Remuneration; Relationship between Remuneration and
Company Performance
Base salary amounts are determined based on market information for similar roles in comparable industries. Other than
market information, there is no link between the base salary determination and Company performance. The calculation of
the key management personnel annual bonus is set against the achievement of specified milestones and targets approved
by the Board. Milestones and targets generally relate to achieving developmental milestones for each pipeline project,
such as achieving inD registrations by particular dates or project related milestones by particular dates. These milestones
are established to support the Company achieving its overall objectives.
The tables below set out summary information about the consolidated entity’s earnings and movements in shareholder
wealth for the five years to 30 June 2013.
30 JUNE 2013
$
30 JUNE 2012
$
30 JUNE 2011
$
30 JUNE 2010
$
30 JUNE 2009
$
Revenue
net loss before tax
net loss after tax
3,724,169
6,834,709
4,071,798
(9,963,175)
(3,328,896)
(10,106,903)
(10,001,350)
(3,136,238)
(9,356,497)
3,848,469
(8,214,082)
(8,214,082)
4,296,496
(6,899,183)
(6,862,299)
30 JUNE 2013
CENTS
30 JUNE 2012
CENTS
30 JUNE 2011
CENTS
30 JUNE 2010
CENTS
30 JUNE 2009
CENTS
Share price at start of year
Share price at end of year
Dividends paid
Basic earnings per share
Diluted earnings per share
30.0
34.0
-
(2.7)
(2.7)
55.5
30.0
-
(0.9)
(0.9)
27.0
55.5
-
(2.9)
(2.9)
21.0
27.0
-
(2.7)
(2.7)
34.0
21.0
-
(2.8)
(2.7)
Other Transactions with Directors and Other Key Management Personnel
There were no other transactions with Directors or other key management personnel during the financial year.
OTHER INFORMATION
ShARES unDER OpTiOn
information relating to shares under option is set out in section 4 of the Remuneration Report. The total number of shares
under option at 30 June 2013 was 10,262,274.
ShARES iSSuED On ThE EXERCiSE Of OpTiOnS
958,026 ordinary shares of Bionomics were issued during the year ended 30 June 2013 on the exercise of options granted
under the Bionomics ESOp.
inSuRAnCE Of OffiCERS
During the financial year, the Company paid a premium to insure the Directors and Officers (D&O) of the Company. under the
terms of this policy the premium paid by the Company is not permitted to be disclosed.
The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may be brought
against the D&O in their capacity as D&O of the Company, and any other payments arising from liabilities incurred by the D&O
in connection with such proceedings, other than where such liabilities arise out of conduct involving a wilful breach of duty by
the D&O or the improper use by the D&O of their position or of information to gain advantage for themselves or someone else
or to cause detriment to the Company.
it is not possible to apportion the premium between amounts relating to the insurance against legal costs and those relating
to other liabilities.
37
DIRECTORS’
REPORT
The Company has not otherwise, during or since the end of the financial year, except to the extent permitted by law,
indemnified or agreed to indemnify an officer or auditor of the Company or of any related body corporate against a liability
incurred as such an officer or auditor.
nOn-AuDiT SERviCES
The Company may decide to employ the external auditor on assignments additional to their statutory audit duties where the
external auditor’s expertise and experience with the Group are important.
Details of the amounts paid to the external auditor for audit and non-audit services provided during the year are set out in note
26 to the financial statements.
The Board has considered the position and, in accordance with the advice received from the Audit and Risk Management
Committee, is satisfied that the provision of the non-audit services is compatible with the general standard of independence
for external auditors imposed by the Corporations Act 2001. The directors are satisfied that the provision of non-audit
services by the external auditor, as set out in note 26 to the financial statements, did not compromise the external auditor
independence requirements of the Corporations Act 2001 for the following reasons:
3 all non-audit services have been reviewed by the Audit and Risk Management Committee to ensure they do not impact the
integrity, impartiality and objectivity of the external auditor; and
3 none of the services undermine the general principles relating to auditor independence as set out in Code of Conduct
ApES 110, Code of Ethics for professional Accountants, issued by the Accounting professional & Ethical Standards Board,
including reviewing or auditing the external auditor’s own work, acting in a management or a decision-making capacity for
the Company, acting as advocate for the Company or jointly sharing economic risk and rewards.
EXTERnAL AuDiTOR
Deloitte Touche Tohmatsu continues in office in accordance with section 327 of the Corporations Act 2001.
A copy of the auditors’ independence declaration as required under section 307C of the Corporations Act 2001 is set out on
page 38.
This directors’ report is signed in accordance with a resolution of directors made pursuant to Section 298(2) of the
Corporations Act 2001.
Graeme Kaufman
Chairman
Adelaide
15 August 2013
Deborah Rathjen
Chief Executive Officer and Managing Director
Adelaide
15 August 2013
38
AuDITORS’ INDEPENDENCE
DEClARATION
39
ANNuAl FINANCIAl
STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
TABlE OF CONTENTS
PG 39
ANNuAl FINANCIAl STATEMENTS
PG 40
CONSOlIDATED STATEMENT OF PROFIT OR lOSS AND OTHER COMPREHENSIVE INCOME
PG 41
CONSOlIDATED STATEMENT OF FINANCIAl POSITION
PG 42
CONSOlIDATED STATEMENT OF CHANGES IN EQuITY
PG 43
CONSOlIDATED STATEMENT OF CASH FlOWS
PG 44
NOTES TO THE FINANCIAl STATEMENTS
PG 81
DIRECTORS’ DEClARATION
PG 82
INDEPENDENT AuDIT REPORT
PG 84
SHAREHOlDER INFORMATION
This financial statement covers both Bionomics Limited (“Bionomics”) as an individual entity
(note 31) and the Group consisting of Bionomics and its subsidiaries. A description of the nature
of the Group’s operations and its principal activities is included throughout the Annual Report
and the Directors’ Report. The financial statement is presented in Australian dollars.
Bionomics is a company limited by shares, incorporated and domiciled in Australia. it is listed
on the ASX (ASX:BnO) and its registered office is 31 Dalgleish Street, Thebarton, SA 5031.
Through the internet, we have ensured that our corporate reporting is timely, complete and
available globally at minimum cost to the company. All press releases, financial statements
and other information are available on our website www.bionomics.com.au.
TABlE OF CONTENTS
PG 39
ANNuAl FINANCIAl STATEMENTS
PG 40
CONSOlIDATED STATEMENT OF PROFIT OR lOSS AND OTHER COMPREHENSIVE INCOME
PG 41
CONSOlIDATED STATEMENT OF FINANCIAl POSITION
PG 42
CONSOlIDATED STATEMENT OF CHANGES IN EQuITY
PG 43
CONSOlIDATED STATEMENT OF CASH FlOWS
PG 44
NOTES TO THE FINANCIAl STATEMENTS
PG 81
DIRECTORS’ DEClARATION
PG 82
INDEPENDENT AuDIT REPORT
PG 84
SHAREHOlDER INFORMATION
40
CONSOlIDATED STATEMENT OF PROFIT OR lOSS
AND OTHER COMPREHENSIVE INCOME FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
CONTINUING OPERATIONS
Revenue
Other income
EXPENSES
Administrative
financing costs
Occupancy
Compliance
Loss on disposal of assets
Research and development
Loss before tax
income tax (expense)/benefit
Loss after tax
NOTE
30 JUNE 2013
$
30 JUNE 2012
$
4
4
5
6
3,724,169
8,101,787
11,825,956
3,352,156
78,198
1,586,144
601,944
184
16,170,505
(9,963,175)
(38,175)
(10,001,350)
6,834,709
3,102,837
9,937,546
2,313,932
64,450
1,417,022
361,872
5,824
9,103,342
(3,328,896)
192,658
(3,136,238)
Other comprehensive income
items that may be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign operations
Total comprehensive income for the year
Loss attributable to:
Owners of the Company
EARNINGS PER SHARE FROM CONTINUING OPERATIONS
Basic loss per share
Diluted loss per share
NOTE
29
29
1,894,514
(8,106,836)
(93,612)
(3,229,850)
(8,106,836)
(3,229,850)
2013
CENTS
(2.7)
(2.7)
2012
CENTS
(0.9)
(0.9)
THE ABOVE CONSOlIDATED STATEMENT OF PROFIT OR lOSS AND OTHER COMPREHENSIVE INCOME
SHOulD BE READ IN CONJuNCTION WITH THE ACCOMPANYING NOTES.
41
CONSOlIDATED STATEMENT
OF FINANCIAl POSITION AS AT 30 JuNE 2013
NOTE
30 JUNE 2013
$
30 JUNE 2012
$
CURRENT ASSETS
Cash and bank balances
Trade and other receivables
Other financial assets
inventories
Current tax asset
Other assets
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
property, plant and equipment
intangible assets
Deferred tax asset
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Borrowings
provisions
Other liabilities
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Other payables
Borrowings
provisions
Contingent consideration
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Capital
Reserves
Accumulated losses
Equity attributable to owners of the Company
7
8
9
10
6
11
13
14
6
15
16
17
18
15
16
17
32
19
20
21
22,452,089
17,336,609
705,722
-
98,526
36,648
7,422,513
30,715,498
842,850
22,052,744
-
22,895,594
53,611,092
4,283,609
680,376
1,081,086
37,447
6,082,518
306,410
400,159
66,327
5,348,695
6,121,591
12,204,109
41,406,983
111,312,572
2,918,670
(72,824,259)
41,406,983
411,417
36,232
135,284
360,386
3,458,142
21,738,070
773,247
8,520,206
70,665
9,364,118
31,102,188
2,828,220
732,819
888,808
18,188
4,468,035
272,855
443,942
18,239
-
735,036
5,203,071
25,899,117
87,834,778
887,248
(62,822,909)
25,899,117
THE ABOVE CONSOlIDATED STATEMENT OF FINANCIAl POSITION SHOulD BE READ IN CONJuNCTION WITH THE ACCOMPANYING NOTES.
42
CONSOlIDATED STATEMENT
OF CHANGES IN EQuITY FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
ISSUED
CAPITAL
$
OTHER
CAPITAL
CONTRIBUTED
FOREIGN
CURRENCY
TRANSLATION
RESERVE
$
SHARE-
BASED
PAYMENTS
RESERVE
$
ACCUMULATED
LOSSES
$
TOTAL
$
BALANCE AT 1 JULY 2011
87,690,990
Loss for the period
Exchange differences
on translation of foreign
operations
Total comprehensive
income
Recognition of share-based
payments
issue of ordinary shares
under Employee Share
Option plan
issue of ordinary shares
under Employee Share plan
-
-
-
-
104,788
39,000
BALANCE AT 30 JUNE 2012
87,834,778
BALANCE AT 1 JULY 2012
87,834,778
Loss for the period
Exchange differences
on translation of foreign
operations
Total comprehensive
income
Recognition of share-based
payments
-
-
-
-
Rights issue net of costs
15,602,162
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(552,274)
1,247,135
(59,686,671)
28,699,180
-
(93,612)
(93,612)
-
-
-
(3,136,238)
(3,136,238)
-
(93,612)
(3,136,238)
(3,229,850)
-
-
-
285,999
-
-
-
-
-
285,999
104,788
39,000
(645,886)
1,533,134
(62,822,909)
25,899,117
(645,886)
1,533,134
(62,822,909)
25,899,117
-
1,894,514
1,894,514
-
-
-
-
-
-
-
136,908
-
-
-
(10,001,350)
(10,001,350)
-
1,894,514
(10,001,350)
(8,106,836)
-
-
-
-
136,908
15,602,162
227,041
7,648,591
issue of ordinary shares
under Employee Share
Option plan
issue of ordinary shares,
net of transaction costs &
income tax
227,041
6,116,024
1,532,567
BALANCE AT 30 JUNE 2013
109,780,005
1,532,567
1,248,628
1,670,042
(72,824,259)
41,406,983
THE ABOVE CONSOlIDATED STATEMENT OF CHANGES IN EQuITY SHOulD BE READ IN CONJuNCTION WITH THE ACCOMPANYING NOTES.
43
CONSOlIDATED STATEMENT
OF CASH FlOWS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
CASH FLOWS FROM OPERATING ACTIVITIES
Grants received
Receipts from customers
payments to suppliers and employees
Tax refund
financing costs
NOTE
2013
$
4,201,787
2,984,760
(17,452,589)
293,534
(9,972,508)
(78,198)
Net cash used in operating activities
27
(10,050,706)
CASH FLOWS FROM INVESTING ACTIVITIES
interest received
payments for purchases of property, plant & equipment
proceeds from sale of property, plant & equipment
net cash acquired on acquisition
Acquisition transaction costs
Net cash (used in) / generated by investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Repayment of borrowings
proceeds from borrowings
net proceeds from share issues
Net cash generated by / (used in) financing activities
Net increase in cash and cash equivalents
Cash at the beginning of the financial year
Effect of exchange rate changes on the balances of cash held
in foreign currency
2012
$
2,837
5,997,281
(10,515,621)
565,811
(3,949,692)
(64,450)
(4,014,142)
1,123,099
(648,797)
6,388,521
-
-
6,862,823
(2,310,658)
652,394
104,788
(1,553,476)
1,295,205
16,052,230
636,871
(172,678)
-
256,279
(1,409,134)
(688,662)
(183,820)
87,594
15,829,202
15,732,976
4,993,608
17,336,609
121,872
(10,826)
Cash and cash equivalents at the end of the year
7
22,452,089
17,336,609
THE ABOVE CONSOlIDATED STATEMENT OF CASH FlOWS SHOulD BE READ IN CONJuNCTION WITH THE ACCOMPANYING NOTES.
44
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
TABlE OF CONTENTS
PG 45
nOTE 1: SuMMARY Of SiGnifiCAnT ACCOunTinG pOLiCiES
PG 53
nOTE 2: CRiTiCAL ACCOunTinG ESTiMATES AnD JuDGEMEnTS
PG 53
nOTE 3: SEGMEnT infORMATiOn
PG 56
nOTE 4: REvEnuE AnD OThER inCOME
PG 56
nOTE 5: EXpEnSES
PG 57
nOTE 6: inCOME TAXES
PG 59
nOTE 7: CASh AnD CASh EquivALEnTS
PG 59
nOTE 8: TRADE AnD OThER RECEivABLES
PG 60
nOTE 9: OThER finAnCiAL ASSETS
PG 60
nOTE 10: invEnTORiES
PG 60
nOTE 11: OThER ASSETS
PG 60
nOTE 12: SuBSiDiARiES
PG 61
nOTE 13: pROpERTY, pLAnT AnD EquipMEnT
PG 62
nOTE 14: inTAnGiBLE ASSETS
PG 63
nOTE 15: TRADE AnD OThER pAYABLES
PG 64
nOTE 16: BORROWinGS
PG 64
nOTE 17: pROviSiOnS
PG 64
nOTE 18: OThER LiABiLiTiES
PG 64
nOTE 19: iSSuED CApiTAL
PG 69
nOTE 20: RESERvES
PG 69
nOTE 21: ACCuMuLATED LOSSES
PG 69
nOTE 22: finAnCiAL inSTRuMEnTS
PG 73
nOTE 23: kEY MAnAGEMEnT pERSOnnEL DiSCLOSuRES
PG 74
nOTE 24: COMMiTMEnTS fOR EXpEnDiTuRE
PG 75
nOTE 25: EvEnTS OCCuRRinG AfTER REpORTinG DATE
PG 75
nOTE 26: REMunERATiOn Of AuDiTORS
PG 75
nOTE 27: CASh fLOW infORMATiOn
PG 76
nOTE 28: nOn-CASh finAnCinG ACTiviTiES
PG 76
nOTE 29: LOSS pER ShARE
PG 77
nOTE 30: RELATED pARTY TRAnSACTiOnS
PG 79
nOTE 31: pAREnT EnTiTY infORMATiOn
PG 79
nOTE 32: BuSinESS COMBinATiOnS – ACquiSiTiOn Of ECLipSE ThERApEuTiCS, inC
45
NOTES TO THE
FINANCIAl STATEMENTS
FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This financial report includes the consolidated financial statements and notes of Bionomics Limited and its controlled entities,
the Group.
STATEMEnT Of COMpLiAnCE
These financial statements are general purpose financial statements which have been prepared in accordance with the
Corporations Act 2001, Accounting Standards and interpretations, and comply with other requirements of the law.
These financial statements comprise the consolidated financial statements of the Group.
The financial statements comprise the consolidated financial statements of the Group. for the purposes of preparing the
consolidated financial statements, the Company is a for-profit entity.
Accounting Standards include Australian Accounting Standards. Compliance with Australian Accounting Standards ensures
that the financial statements and notes of the company and the Group comply with international financial Reporting
Standards (ifRS).
The financial statements were authorised for issue by the directors on 15 August 2013.
BASiS Of pREpARATiOn
The consolidated financial statements have been prepared on the basis of historical cost, except for certain non-current
assets and financial instruments that are measured at revalued amounts or fair values, as explained in the accounting policies
below. historical cost is generally based on the fair values of the consideration given in exchange for assets. All amounts are
presented in Australian dollars unless otherwise noted.
ADOpTiOn Of nEW AnD REviSED ACCOunTinG STAnDARDS
in the current year, the Group has adopted all of the new and revised Standards and interpretations issued by the Australian
Accounting Standards Board (the AASB) that are relevant to its operations and effective for the current annual reporting period.
STAnDARDS AnD inTERpRETATiOnS in iSSuE nOT YET ADOpTED
At the date of the financial statements, the Standards and interpretations listed below were in issue but not yet effective.
The reported results and position of the Group will not change on adoption of these pronouncements as currently there are
no transactions that will be materially impacted by these pronouncements. Adoption of these pronouncements will however,
result in changes to information currently disclosed in the financial statement. The Group does not intend to adopt any of these
pronouncements before their effective dates.
STANDARD / INTERPRETATION
AASB 9 ‘financial instruments’, and the relevant
amending standards
AASB 10 ‘Consolidated financial Statements’ and
AASB 2011-7 ‘Amendments to Australian Accounting
Standards arising from the consolidation and Joint
Arrangement standards’
AASB 11 ‘Joint Arrangements’ and AASB 2001-7
‘Amendments to Australian Accounting Standards
arising from the consolidation and Joint
Arrangements standards’
AASB 12 ‘Disclosure of interests in Other Entities’ and
AASB 2011-7 ‘Amendments to Australian Accounting
Standards arising from the consolidation and Joint
Arrangements standards’
EFFECTIVE FOR ANNUAL
REPORTING PERIODS
BEGINNING ON OR AFTER
EXPECTED TO BE INITIALLY
APPLIED IN THE FINANCIAL
YEAR ENDING
1 January 2015
30 June 2016
1 January 2013
30 June 2014
1 January 2013
30 June 2014
1 January 2013
30 June 2014
46
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES CONT.
STANDARD / INTERPRETATION
AASB 127 ‘Separate financial Statements’ (2011) and
AASB 2011-7 ‘Amendments to Australian Accounting
Standards arising from the consolidation and Joint
Arrangements standards’
AASB 128 ‘investments in Associates and Joint
ventures (2011) and AASB 2011-7 ‘Amendments to
Australian Accounting Standards arising from the
consolidation and Joint Arrangements standards’
AASB 13 ‘fair value Measurement’ and AASB 2011-8
‘Amendments to Australian Accounting Standards
arising from AASB 13’
AASB 119 ‘Employee Benefits’ (2011) and AASB 2011-
10 ‘Amendments to Australian Accounting Standards
arising from AASB 119 (2011)’
AASB 2011-4 ‘Amendments to Australian Accounting
Standards to Remove individual key Management
personnel Disclosure Requirements’
AASB 2012-2 ‘Amendments to Australian Accounting
Standards – Disclosures – Offsetting financial Assets
and financial Liabilities’
AASB 2012-3 ‘Amendments to Australian Accounting
Standards – Offsetting financial Assets and financial
Liabilities’
AASB 2012-5 ‘Amendments to Australian Accounting
Standards arising from Annual improvements 2009-
2011 Cycle’
AASB 2012-10 ‘Amendments to Australian Accounting
Standards – Transition Guidance and Other
Amendments’
EFFECTIVE FOR ANNUAL
REPORTING PERIODS
BEGINNING ON OR AFTER
EXPECTED TO BE INITIALLY
APPLIED IN THE FINANCIAL
YEAR ENDING
1 January 2013
30 June 2014
1 January 2013
30 June 2014
1 January 2013
30 June 2014
1 January 2013
30 June 2014
1 July 2013
30 June 2014
1 January 2013
30 June 2014
1 January 2014
30 June 2015
1 January 2013
30 June 2014
1 January 2013
30 June 2014
ACCOunTinG pOLiCiES
The following significant accounting policies have been adopted in the preparation and presentation of the financial report.
(a) Principles of Consolidation
The consolidated financial statements comprise the financial statements of Bionomics Limited and its subsidiaries as at
30 June 2013.
The financial statements of the subsidiaries are prepared for the same reporting period as the parent entity, using
consistent accounting policies where possible. Adjustments are made to bring into line any dissimilar accounting policies
that may exist.
All intercompany balances and transactions, including unrealised profits arising from intra-group transactions, have been
eliminated in full.
Subsidiaries are consolidated from the date on which control is obtained and cease to be consolidated from the date on
which control ceases.
Where there is loss of control of a subsidiary, the consolidated financial statements include the results for the part of the
reporting period during which the Company has control.
47
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 1: SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES CONT.
(b) Foreign Currency
(i) Functional and Presentation Currency
items included in the financial statements of each of
the Group’s entities are measured using the currency
of the primary economic environment in which
the entity operates (the functional currency). The
consolidated financial statements are presented in
Australian dollars which is Bionomics’ functional and
presentation currency.
(ii) Transactions and Balances
foreign currency transactions are translated
into the functional currency using the exchange
rates prevailing at the dates of the transactions.
foreign exchange gains and losses resulting from
the settlement of such transactions and from the
translation at period-end exchange rates of monetary
assets and liabilities denominated in foreign
currencies are recognised in profit and loss.
Exchange differences on monetary items are
recognised in profit or loss in the period in which they
arise except for:
3 exchange differences on transactions entered into in
order to hedge certain foreign currency risks; and
3 exchange differences on monetary items receivable
from or payable to a foreign operation for which
settlement is neither planned nor likely to occur
(therefore forming part of the net investment in the
foreign operation), which are recognised initially
in other comprehensive income and reclassified
from equity to profit or loss on repayment of the
monetary items.
(iii) Group Companies
The results and financial position of all the Group
entities that have a functional currency different from
the presentation currency (Australian dollars) are
translated into the presentation currency as follows:
3 assets and liabilities for each statement of financial
position presented are translated at the closing rate
at the date of that statement;
3 income and expenses for each statement of
comprehensive income are translated at the
average exchange rate for the period; and
3 all resulting exchange differences are recognised in
other comprehensive income and accumulated
in equity.
Goodwill and fair value adjustments arising on the
acquisition of a foreign entity are treated as assets
and liabilities of the foreign entity and translated at
the closing rate.
(c) Revenue Recognition
interest revenue is recognised on an accruals basis using
the effective interest rate method.
Service income is recognised when the services are
rendered. Rental income is recognised on a straight line
basis over the term of the lease.
License revenues received in respect of future accounting
periods are deferred until the Group has fulfilled its
obligations under the terms of the agreement.
Where a license agreement has a fixed fee in a non-
cancellable contract which permits the licensee to exploit
those rights freely and the Group has no remaining
obligations to perform, the fee is treated as a sale. Where
these conditions have not been met, the license fee is
amortised over the life of the licensing agreement.
unamortised license fee revenue is recognised in the
statement of financial position as deferred income.
Research and development work performed for a fee
is recognised based on the stage of completion of the
research and development.
Revenue from a contract to provide services is recognised
by reference to the stage of completion of the contract.
Milestone payments within license agreements are
recognised when the milestone has been achieved.
(d) Government Grants and Government Assistance
Grants from the government are recognised at their
fair value where there is a reasonable assurance that
the grant will be received and the Group will comply
with all attached conditions. Grants relating to cost
reimbursement are recognised in the profit or loss in the
period when the costs were incurred. Grants relating
to asset purchases are recognised as deferred income
on the statement of financial position and transferred to
the profit or loss evenly over the expected life of those
assets.
Government assistance is not recognised until there is
reasonable assurance that the Group will be eligible
for the assistance and that the income will be received.
Government assistance which does not have conditions
attached specifically relating to operating activities is
recognised as income when it can be reasonably assured
that it will be received.
Certain forms of government assistance cannot
reasonably have a value placed upon them. The nature
and extent of the government assistance is disclosed as
well as reference to any contingent component that has
not been recognised as the end of the reporting period.
Research and Development tax incentive is treated as
government assistance.
48
NOTE 1: SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES CONT.
(e) Income Tax
The income tax expense or revenue for the period is the
tax payable on the current period’s taxable income based
on the national income tax rate for each jurisdiction
adjusted by changes in deferred tax assets and liabilities
attributable to temporary differences between the tax
bases of assets and liabilities and their carrying amounts
in the financial statements, and to unused tax losses.
Deferred tax assets and liabilities are recognised for
temporary differences at the tax rates expected to
apply when the assets are recovered or liabilities are
settled, based on those tax rates which are enacted or
substantively enacted for each jurisdiction. The relevant tax
rates are applied to the cumulative amounts of deductible
and taxable temporary differences to measure the deferred
tax asset or liability. An exception is made for certain
temporary differences arising from the initial recognition
of an asset or a liability. no deferred tax asset or liability
is recognised in relation to these temporary differences
if they arose in a transaction, other than a business
combination, that at the time of the transaction did not
affect either accounting profit or taxable profit or loss.
Deferred tax assets are recognised for deductible
temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to
utilise those temporary differences and losses.
Current and deferred tax balances attributable to
amounts recognised directly in equity are also recognised
directly in equity.
(i) Tax Consolidation Legislation
Bionomics and its wholly-owned Australian controlled
entities have implemented the tax consolidation
legislation effective 31 December 2005.
The head entity, Bionomics, and the controlled entities
in the tax consolidated group account for their own
current and deferred tax amounts. These tax amounts
are measured as if each entity in the tax consolidated
group continues to be a stand-alone taxpayer in its
own right.
in addition to its own current and deferred tax amounts,
Bionomics also recognises the current tax liabilities (or
assets) and the deferred tax assets arising from unused
tax losses and unused tax credits assumed from
controlled entities in the tax consolidated group.
Assets or liabilities arising under tax funding
agreements with the tax consolidated entities are
recognised as amounts receivable from or payable to
other entities in the group.
Any difference between the amounts assumed and
amounts receivable or payable under the taxfunding
agreement are recognised as a contribution to (or
distribution from) wholly-owned tax consolidated entities.
(f) Business Combinations
Acquisitions of businesses are accounted for using the
acquisition method. The consideration transferred in a
business combination is measured at fair value which is
calculated as the sum of the acquisition-date fair values
of assets transferred by the Group, liabilities incurred
by the Group to the former owners of the acquiree and
the equity instruments issued by the Group in exchange
for control of the acquiree. Acquisition-related costs are
recognised in profit or loss as incurred.
At the acquisition date, the identifiable assets acquired
and the liabilities assumed are recognised at their fair
value, except that:
3 deferred tax assets or liabilities and assets or
liabilities related to employee benefit arrangements
are recognised and measured in accordance with
AASB 112 ‘income Taxes’ and AASB 119 ‘Employee
Benefits’ respectively;
3 liabilities or equity instruments related to share-based
payment arrangements of the acquiree or share-based
payment arrangements of the Group entered into to
replace share-based payment arrangements of the
acquiree are measured in accordance with AASB 2
‘Share-based payment’ at the acquisition date; and
3 assets (or disposal groups) that are classified as
held for sale in accordance with AASB 5 ‘noncurrent
Assets held for Sale and Discontinued Operations’ are
measured in accordance with that Standard.
Goodwill is measured as the excess of the sum of the
consideration transferred, the amount of any non-
controlling interests in the acquiree, and the fair value of
the acquirer’s previously held equity interest in the acquiree
(if any) over the net of the acquisition-date amounts of the
identifiable assets acquired and the liabilities assumed.
if, after reassessment, the net of the acquisition-date
amounts of the identifiable assets acquired and liabilities
assumed exceeds the sum of the consideration transferred,
the amount of any non-controlling interests in the acquiree
and the fair value of the acquirer’s previously held
interest in the acquiree (if any), the excess is recognised
immediately in profit or loss as a bargain purchase gain.
non-controlling interests that are present ownership
interests and entitle their holders to a proportionate
share of the entity’s net assets in the event of liquidation
may be initially measured either at fair value or at the
non-controlling interests’ proportionate share of the
recognised amounts of the acquiree’s identifiable net
49
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 1: SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES CONT.
assets. The choice of measurement basis is made on a
transaction-by-transaction basis. Other types of non-
controlling interests are measured at fair value or, when
applicable, on the basis specified in another Standard.
Where the consideration transferred by the Group in
a business combination includes assets or liabilities
resulting from a contingent consideration arrangement,
the contingent consideration is measured at its
acquisition-date fair value. Changes in the fair value of
the contingent consideration that qualify as measurement
period adjustments are adjusted retrospectively,
with corresponding adjustments against goodwill.
Measurement period adjustments are adjustments that
arise from additional information obtained during the
‘measurement period’ (which cannot exceed one year
from the acquisition date) about facts and circumstances
that existed at the acquisition date.
The subsequent accounting for changes in the fair
value of contingent consideration that do not qualify
as measurement period adjustments depends on how
the contingent consideration is classified. Contingent
consideration that is classified as equity is not
remeasured at subsequent reporting dates and its
subsequent settlement is accounted for within equity.
Contingent consideration that is classified as an asset
or liability is remeasured at subsequent reporting dates
in accordance with AASB 139, or AASB 137 ‘provisions,
Contingent Liabilities and Contingent Assets’, as
appropriate, with the corresponding gain or loss being
recognised in profit or loss.
Where a business combination is achieved in stages, the
Group’s previously held equity interest in the acquiree is
remeasured to fair value at the acquisition date (ie the
date when the Group attains control) and the resulting
gain or loss, if any, is recognised in profit or loss.
Amounts arising from interests in the acquiree prior to
the acquisition date that have previously been recognised
in other comprehensive income are reclassified to profit
or loss where such treatment would be appropriate if that
interest were disposed of.
if the initial accounting for a business combination is
incomplete by the end of the reporting period in which
the combination occurs, the Group reports provisional
amounts for the items for which the accounting is
incomplete. Those provisional amounts are adjusted
during the measurement period (see above), or additional
assets or liabilities are recognised, to reflect new
information obtained about facts and circumstances that
existed as of the acquisition date that, if known, would
have affected the amounts recognised as of that date.
(g) Impairment of Tangible and Intangible Assets Other
Than Goodwill
At the end of each reporting period, the Group reviews
the carrying amounts of its tangible and intangible
assets to determine whether there is any indication
that those assets have suffered an impairment loss. if
any such indication exists, the recoverable amount of
the asset is estimated in order to determine the extent
of the impairment loss (if any). Where it is not possible
to estimate the recoverable amount of an individual
asset, the Group estimates the recoverable amount of
the cash-generating unit to which the asset belongs.
Where a reasonable and consistent basis of allocation
can be identified, corporate assets are also allocated to
individual cash-generating units, or otherwise they are
allocated to the smallest group of cash-generating units
for which a reasonable and consistent allocation basis
can be identified.
intangible assets with indefinite useful lives are tested
for impairment at least annually, and whenever there is
an indication that the asset may be impaired.
Recoverable amount is the higher of fair value less
costs to sell and value in use. in assessing value in use,
the estimated future cash flows are discounted to their
present value using a pre-tax discount rate that reflects
current market assessments of the time value of money
and the risks specific to the asset for which the estimates
of future cash flows have not been adjusted.
if the recoverable amount of an asset (or cash-generating
unit) is estimated to be less than its carrying amount, the
carrying amount of the asset (or cash-generating unit) is
reduced to its recoverable amount. An impairment loss is
recognised immediately in profit or loss, unless the relevant
asset is carried at a revalued amount, in which case the
impairment loss is treated as a revaluation decrease.
Where an impairment loss subsequently reverses, the
carrying amount of the asset (or cash-generating unit)
is increased to the revised estimate of its recoverable
amount, but so that the increased carrying amount does
not exceed the carrying amount that would have been
determined had no impairment loss been recognised
for the asset (or cash-generating unit) in prior years. A
reversal of an impairment loss is recognised immediately
in profit or loss, unless the relevant asset is carried
at a revalued amount, in which case the reversal of the
impairment loss is treated as a revaluation increase.
50
NOTE 1: SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES CONT.
(h) Cash and Cash Equivalents
Cash and cash equivalents includes cash on hand,
deposits held at call with financial institutions, other
short term, highly liquid investments with original
maturities of three months or less that are readily
convertible to known amounts of cash and which are
subject to an insignificant risk of changes in value and
bank overdrafts. Bank overdrafts are shown within
borrowings in current liabilities on the statement of
financial position.
(i) Trade Receivables
All trade debtors are recognised at the fair value of
amounts receivable as they are due for settlement no
more than 30 days from the date of recognition.
Collectability of trade debtors is reviewed on an ongoing
basis. Debts which are known to be uncollectible are
written off. A provision for doubtful debts is raised when
some doubt as to collection exists. The amount of the
provision is the difference between the carrying amount
and the present value of future cash flows, discounted at
the effective interest rate. The amount of the provision is
recognised in profit or loss.
(j) Inventories
Raw materials and stores are stated at the lower of cost
and net realisable value.
(k) Property, Plant and Equipment
Land and buildings are shown at fair value, based on
periodic, valuations by external independent valuers, less
subsequent depreciation for buildings. Any accumulated
depreciation at the date of revaluation is eliminated
against the gross carrying amount of the asset and the
net amount is restated to the revalued amount of the
asset. All other plant and equipment are brought to
account at cost less any accumulated depreciation or
any recognised impairment losses, where applicable.
The directors have taken reasonable steps to ensure
that property, plant and equipment are not carried at
amounts that are in excess of their recoverable amounts
at balance date.
increases in the carrying amounts arising on revaluation
of land and buildings are credited, net of tax, to other
comprehensive income. To the extent that the increase
reverses a decrease previously recognised in profit or
loss, the increase is first recognised in profit or loss.
Decreases that reverse previous increases of the same
asset are first charged against revaluation reserves
directly in equity to the extent of the remaining reserve
attributable to the asset; all other decreases are charged
to profit or loss.
Depreciation on revalued buildings is charged to profit and
loss. On the subsequent sale or retirement of a revalued
property, the attributable revaluation surplus remaining
in the revaluation reserve, net of tax, is transferred
directly to retained earnings. Land is not depreciated.
The depreciable amount of all fixed assets is depreciated
over their useful lives commencing from the time
the asset is held ready for use, on either a prime or
diminishing value basis depending on the type of asset.
The gain or loss on disposal of all fixed assets is determined
as the difference between the carrying amount of the asset
at the time of disposal and the proceeds of disposal and is
included in profit or loss in the year of disposal.
The depreciation rates for each class of depreciable
assets are:
3 administrative plant & equipment
3 scientific plant & equipment
3 refrigeration plant and equipment
20 – 40%
20 – 40%
33%
(l) Financial Assets
financial assets are classified into the following specified
categories: financial assets ‘at a fair value through
profit or loss’ (fvTpL), ‘held-to-maturity’ investments,
‘available-for-sale’ (AfS) financial assets and ‘loans and
receivables’. The classification depends on the nature and
purpose of the financial assets and is determined at the
time of initial recognition. All regular way purchases or
sales of financial assets are recognised and derecognised
on a trade date basis. Regular way purchases or sales
are purchases or sales of financial assets that require
delivery of assets within the time frame established by
regulation or convention in the marketplace.
(i) Loans and Receivables
Trade receivables, loans and other receivables that
have fixed or determinable payments that are not
quoted in an active market are classified as ‘loans and
receivables’. Loans and receivables are measured at
amortised cost using the effective interest method
less impairment.
interest income is recognised by applying the effective
interest rate.
(ii) Impairment of Financial Assets
financial assets, other than those at fair value
through profit or loss, are assessed for indicators of
impairment at each reporting date. financial assets
are impaired where there is objective evidence that
as a result of one or more events that occurred
after the initial recognition of the financial asset the
estimated future cash flows of the investment have
been impacted.
51
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 1: SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES CONT.
for financial assets carried at amortised cost, the
amount of the impairment is the difference between
the asset’s carrying amount and the present value
of estimated future cash flows, discounted at the
original effective interest rate.
The carrying amount of financial assets including
uncollectible trade receivables is reduced by the
impairment loss through the use of an allowance
account. Subsequent recoveries of amounts
previously written off are credited against the
allowance account. Changes in the carrying amount of
the allowance account are recognised in profit or loss.
(m) Intangible Assets
(i) Intellectual Property
Acquired intellectual property is recognised as
an asset at cost and amortised over its useful life.
intellectual property with a finite life is amortised on a
straight line basis over that life. intellectual property
with an indefinite useful life is subjected to an annual
impairment review. There is currently no intellectual
property with an indefinite life.
Current useful life of all existing intellectual property
is in the range of 5 to 20 years.
The assets’ residual values and useful lives are
reviewed, and adjusted if appropriate, at each balance
date.
(ii) Goodwill
Goodwill is initially recorded at the amount by which
the purchase price for a business or for an ownership
interest in a controlled entity exceeds the fair value
attributed to its net identifiable assets, including any
associated deferred tax assets and liabilities, at date
of acquisition. Goodwill on acquisitions of subsidiaries
is included in intangible assets.
Goodwill acquired in business combinations is not
amortised. instead, goodwill is tested for impairment
annually and is carried at cost less accumulated
impairment losses. Gains and losses on the disposal
of an entity include the carrying amount of goodwill
relating to the entity sold. Goodwill is allocated to
cash generating units for the purpose of impairment
testing.
(n) Research and Development
Expenditure on research activities, undertaken with
the prospect of obtaining new scientific or technical
knowledge and understanding, is recognised as an
expense when it is incurred.
(o) Trade and Other Payables
These amounts represent liabilities for goods and
services provided to the Group prior to the end of
financial year which are unpaid. The amounts are
unsecured and are usually paid within 45 days of
recognition.
(p) Employee Benefits
(i) Wages and Salaries, Annual Leave and Sick Leave
Liabilities for wages and salaries, including non-
monetary benefits and annual leave in respect of
employees’ services up to the reporting date and
expected to be settled within 12 months of the
reporting date are recognised in liabilities and
are measured at the amounts expected to be paid
when the liabilities are settled. Liabilities for non-
accumulating sick leave are recognised when the
leave is taken at the rates paid.
(ii) Long Service Leave
The liability for long service leave is recognised in the
provision for employee benefits in respect of services
provided by employees up to the reporting date and
measured as the present value of expected future
payments to be made.
(iii) Superannuation
Contributions are made to employee superannuation
funds and are charged as expenses when incurred.
These contributions are made to external
superannuation funds and are not defined benefits
programs. Consequently there is no exposure to
market movements on employee superannuation
liabilities or entitlements.
(iv) Share-based Payments
Share-based compensation benefits are provided to
employees via the Bionomics ESOp and an Employee
Share plan.
The fair value of shares issued to employees for
no cash consideration under the Employee Share
plan is recognised as an employee benefits expense
with a corresponding increase in equity. The fair
value is measured at grant date and recognised
over the period during which the employees become
unconditionally entitled to the shares.
The Bionomics ESOp was approved by the Board and
shareholders in 2011. Staff eligible to participate in
the plan are those who have been a full-time or part-
time employee of the Company for a period of not
less than six months or a director of the Company.
Options are granted under the plan for no
consideration and vest equally over five years, unless
they are bonus options which vest immediately.
52
NOTE 1: SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES CONT.
The amounts disclosed as remuneration relating to
options are the assessed fair values at grant date
of those options allocated equally over the period
from grant date to vesting date. fair values at grant
date are independently determined using a Black-
Scholes option pricing model that takes into account
the exercise price, the term of the option, the vesting
and performance criteria, the impact of dilution, the
non-tradeable nature of the option, the share price at
grant date, expected price volatility of the underlying
share, the expected dividend yield and the risk-free
interest rate for the term of the option.
Share options that have been issued, but due to
having performance criteria, have not yet been
granted or vested, are required to have their fair
value estimated at the end of the reporting period
and recognised as an expense relating to the period
in which the services were performed.
(q) Borrowings (other financial liabilities)
Borrowings are initially recognised at fair value, net of
transaction costs incurred. Borrowings are subsequently
measured at amortised cost. Any difference between the
proceeds (net of transaction costs) and the redemption
amount is recognised in profit or loss over the period of
the borrowings using the effective interest method.
Borrowings are classified as current liabilities unless the
Group has an unconditional right to defer settlement of
the liability for at least 12 months after the balance
sheet date.
(r) Borrowing Costs
Borrowing costs incurred for the construction of any
qualifying asset are capitalised during the period of time
that is required to complete and prepare the asset for its
intended use or sale. Other borrowing costs are expensed.
(s) Leases
Leases of property, plant and equipment where the Group
has substantially all the risks and rewards of ownership
are classified as finance leases. finance leases are
capitalised at the lease’s inception at the lower of the
fair value of the leased property and the present value of
the minimum lease payments. The corresponding rental
obligations, net of finance charges, are included in other
long term payables. Each lease payment is allocated
between the liability and finance charges so as to achieve
a constant rate on the finance balance outstanding.
The interest element of the finance cost is charged to
the profit or loss over the lease period so as to produce
a constant periodic rate of interest on the remaining
balance of the liability for each period. The property,
plant and equipment acquired under finance leases is
depreciated over the shorter of the asset’s useful life and
the lease term.
Leases in which a significant portion of the risks and
rewards of ownership are retained by the lessor are
classified as operating leases. payments made under
operating leases (net of any incentives received from the
lessor) are charged to profit or loss on a straight-line
basis over the period of the lease.
Lease income from operating leases is recognised in
income on a straight-line basis over the lease term.
(t) Contributed Equity
Ordinary shares are classified as equity.
incremental costs directly attributable to the issue of
new shares or options, or for the acquisition of a
business, are deducted directly from equity.
(u) Earnings/(Loss) per Share
(i) Basic Earnings/(Loss) per Share
Basic earnings/(loss) per share is calculated by
dividing the profit/(loss) after income tax attributable
to equity holders of the company, excluding any costs
of servicing equity other than ordinary shares, by
the weighted average number of ordinary shares
outstanding during the year, adjusted for bonus
elements in ordinary shares issued during the year.
(ii) Diluted Earnings/(Loss) per Share
Diluted earnings/(loss) per share adjusts the figures
used in the determination of basic earnings per share
to take into account the after income tax effect of
interest and other financing costs associated with
dilutive potential ordinary shares and the weighted
average number of shares assumed to have been
issued for no consideration in relation to options.
(v) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the
amount of associated GST, unless the GST incurred is not
recoverable from the taxation authority. in this case it is
recognised as part of the cost of acquisition of the asset
or as part of the expense.
Receivables and payables are stated inclusive of the
amount of GST receivable or payable. The net amount
of GST recoverable from, or payable to, the taxation
authority is included with other receivables or payables
in the statement of financial position.
Cash flows are presented on a gross basis. The GST
component of cash flow arising from investing or
financing activities which are recoverable from, or
payable to the taxation authority, are presented as
operating cash flow.
53
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 2: CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
in the application of the Group’s accounting policies, which are described in note 1, the directors are required to make
judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent
from other sources. The estimates and associated assumptions are based on historical experience and other factors that are
considered to be relevant. 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.
(a) Critical Accounting Estimates and Judgements
The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition,
seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities are discussed below.
Estimated Impairment of Goodwill and Intangibles
Determining whether goodwill and intangibles are impaired requires an estimation of the value in use of the cash-
generating units to which goodwill has been allocated. The value in use calculation requires the entity to estimate the
future cash flows expected to arise from the cash-generating units and a suitable discount rate in order to calculate
present value.
The carrying amount of goodwill at balance date was $5,147,990 (2012: $5,147,990).
The total carrying amount of intangibles at balance date was $22,052,744 (2012: $8,520,206).
no impairment costs have been recognised in the current or previous financial years.
Valuation of Intangible Asset and Contingent Consideration on Acquisition of Eclipse Therapeutics, Inc
in accordance with Accounting Standard AASB 3 ‘Business Combinations’ and as detailed in note 32, the Company has
provisionally determined, based on the directors’ best estimate the likely fair value of the consideration transferred,
intangible assets (including, but not limited to intellectual property, goodwill and deferred tax assets) which may be
amended when further information to support these values is obtained.
NOTE 3: SEGMENT INFORMATION
information reported to the chief operating decision maker for the purposes of resource allocation and assessment of
segment performance focuses on the nature of work processes performed. The Group’s reportable segments under
AASB 8 are:
3 Drug discovery
3 Drug development
3 Contract services
Drug discovery is the creation and ongoing testing of compounds to determine the best compound that matches the product
profile. Drug development is defined as the ongoing testing including clinical trials of the best compound with a view to
commercialisation of the compound. Contract services is the provision of scientific services on a fee for service basis to both
external and internal customers.
54
NOTE 3: SEGMENT INFORMATION CONT.
information regarding these segments is presented as follows:
(a) Segment Revenues and Results
The following is an analysis of the Group’s revenue and results by reportable operating segment for the periods under review:
Drug discovery
Drug development
Contract services
SEGMENT REVENUE
YEAR ENDED
SEGMENT PROFIT
YEAR ENDED
30 JUNE 2013
$
30 JUNE 2012
$
30 JUNE 2013
$
30 JUNE 2012
$
345,044
1,088,479
(5,643,324)
(1,379,381)
1,452,602
3,555,621
(3,640,544)
(203,030)
3,076,716
1,801,887
833,057
8,024
4,874,362
6,445,987
(8,450,811)
(1,574,387)
Less: intercompany revenue included in contract services
(2,040,591)
(917,543)
-
-
investment & other revenue
890,398
1,306,265
890,398
1,306,265
3,724,169
6,834,709
(7,560,413)
(268,122)
unallocated financing costs
Central administration costs
Loss before income tax (continuing operations)
(68,703)
(56,831)
(2,334,059)
(3,003,943)
(9,963,175)
(3,328,896)
Revenue reported above for Contract services includes intersegment sales. There were no intersegment sales for the other
reportable segments.
Segment profit represents the result for each segment without allocation of central administration costs and investment and
other revenue. financing costs are allocated to segments with a residual amount being unallocated financing costs.
(b) Segment Assets and Liabilities
The following is an analysis of the Group’s assets and liabilities by reportable operating segment:
ASSETS
Drug discovery
Drug development
Contract services
unallocated assets
Total assets
LIABILITIES
Contract services (excluding intercompany liabilities)
unallocated liabilities
Total liabilities
30 JUNE 2013
$
30 JUNE 2012
$
20,260,167
10,131,324
825,460
3,093,726
8,578,963
1,712,836
31,216,951
13,385,525
22,394,141
17,716,663
53,611,092
31,102,188
835,940
855,097
11,368,169
4,347,974
12,204,109
5,203,071
Assets used jointly by reporting segments are allocated on the basis of employee numbers of the individual reportable segment.
The Board receive information on liabilities for the Group as a whole as well as liability information for the Contract services
segment.
55
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 3: SEGMENT INFORMATION CONT.
The Board receive information on non-current assets for the Group as a whole as well as non-current asset information for
the Contract services segment. Additions to non-current assets:
Contract services
unallocated
(c) Other Segment Information
The segment result above has been determined after including the following items:
30 JUNE 2013
$
30 JUNE 2012
$
15,489
288,600
304,089
20,173
628,623
648,796
Drug discovery
Drug development
Contract services
unallocated
INTEREST EXPENSE
YEAR ENDED
DEPRECIATION AND
AMORTISATION
YEAR ENDED
30 JUNE 2013
$
30 JUNE 2012
$
30 JUNE 2013
$
30 JUNE 2012
$
-
-
9,495
68,703
78,198
-
-
7,619
56,831
64,450
770,673
248,597
203,579
22,966
1,245,815
208,887
240,388
213,275
34,167
696,717
(d) Revenue from Major Products and Services
The following is an analysis of the Group’s external revenue from its major products and services:
Contract services
Collaboration income
interest
Other (note 4)
30 JUNE 2013
$
30 JUNE 2012
$
1,036,125
1,162,117
644,626
881,301
884,344
4,254,715
1,035,947
659,703
3,724,169
6,834,709
(e) Geographical Information
The Group operates in three geographical areas, Australia, france and united States of America. The Group’s external
revenue and information about its non-current assets* by geographical segment are detailed below:
Australia
france
uSA
REVENUE FROM
EXTERNAL CUSTOMERS
YEAR ENDED
NON-CURRENT
ASSETS*
YEAR ENDED
30 JUNE 2013
$
30 JUNE 2012
$
30 JUNE 2013
$
30 JUNE 2012
$
2,688,044
1,036,125
-
5,950,365
22,054,855
8,577,038
884,344
-
609,491
231,248
716,415
-
3,724,169
6,834,709
22,895,594
9,293,453
*non-current assets excluding financial instruments and deferred tax assets.
56
NOTE 3: SEGMENT INFORMATION CONT.
(f) Information about Major Customers
included in revenues for Drug discovery are revenues of $384,170 (2012: $932,598) from one party and in Drug
development $1,394,944 (2012: $3,341,346) from one party. no other customer contributed 10% or more to the Group’s
revenue for both 2013 and 2012.
NOTE 4: REVENUE AND OTHER INCOME
Revenue
Revenue from rendering of services
Royalties
Collaboration income
interest income
Rent income
Other revenue
Other income
foreign Government grant
R&D Tax incentive
2013
$
2012
$
1,032,144
57,658
856,200
135,866
1,162,117
4,254,715
644,626
222,561
605,063
1,035,947
282,068
269,913
3,724,169
6,834,709
-
2,837
8,101,787
3,100,000
8,101,787
3,102,837
potentially eligible overseas expenditure is awaiting Ausindustry approval pending review of applications submitted prior to
30 June 2013 which is not included as part of the estimate of R&D incentive for year ended 30 June 2013. The 2013 balance
includes an amount of $1,101,787, which was excluded for the year ended 30 June 2012, as overseas applications for eligible
expenditure were pending and approved subsequent to the year end.
There are no unfulfilled conditions or other contingencies attaching to these grants.
NOTE 5: EXPENSES
Loss before income tax benefit includes the following specific expenses:
Financing costs
- interest expense on bank and other loans
- interest obligations under finance leases
Depreciation
- Administrative plant and equipment
- Scientific plant and equipment
Amortisation of non-current assets
- intellectual property
Rental expense on operating leases
- Minimum lease payments
Employment benefit expenses of:
- Wages and salaries
- Superannuation
- Share-based payments
Loss on disposal of assets
- plant and equipment
foreign currency loss/(gain)
2013
$
2012
$
41,684
36,514
78,198
37,817
200,088
237,905
45,125
19,325
64,450
34,616
134,368
168,984
1,007,910
527,733
927,682
894,252
5,092,005
3,403,058
496,730
136,908
497,457
324,999
5,725,643
4,225,514
184
5,824
836,584
(65,321)
57
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 6: INCOME TAXES
(a) Income Tax Recognised in Profit or Loss
CURRENT TAX
Current tax benefit in respect of the current year
DEFERRED TAX
Deferred tax recognised in current year
Total income tax expense/(benefit)
(b) Reconciliation to Accounting Loss
Loss from continuing operations
Tax at the Australian tax rate of 30% (2012: 30%)
Tax effect of non-deductible / non-assessable amounts
- Amortisation of intangibles
- foreign exchange reversed on consolidation
- Exempt income from government assistance
- Entertainment
- Share-based payments
- Research and development expenditure
Effect of different tax rates in other jurisdictions
Effect on unused tax losses, not previously recognised, in the current period
Adjustment to prior year unused tax losses
Deferred tax assets not recognised in current period
Tax benefit of research and development credit in france
(c) Current Tax Balances
CURRENT TAX ASSETS
Tax refund receivable
2013
$
2012
$
(32,490)
(121,993)
(32,490)
(121,993)
70,665
70,665
(70,665)
(70,665)
38,175
(192,658)
(9,963,175)
(3,328,896)
(2,988,953)
(998,669)
101,893
101,893
52,678
(16,292)
(2,430,536)
(930,000)
249
1,393
41,072
116,940
4,661,493
2,033,747
13,928
(7,060)
1,009,323
(1,705,451)
(390,482)
1,287,213
-
45,621
(32,490)
(121,993)
38,175
(192,658)
36,648
360,386
36,648
360,386
58
OPENING
BALANCE
$
CHARGED
TO INCOME
$
CHARGED
TO EQUITY
$
OTHER
COMPRE-
HENSIVE
INCOME
$
CLOSING
BALANCE
$
262,381
(32,133)
(10,870)
10,870
(2,655)
(22,451)
184,318
334,592
218,383
10,395
236,244
1,210,337
(2,327)
4,027
(38,419)
32,296
-
3,150
41,914
19,378
19,854,143
(68,636)
213,015
(151,519)
20,067,158
(220,155)
21,206,830
(130,112)
70,665
(70,665)
258,857
3,524
-
(10,870)
(28,801)
(28,213)
222,737
256,493
218,383
26,146
5,762
(38,419)
78,099
-
60,587
(50,192)
204,673
1,164,716
31,571
45,621
21,496,973
(1,642,830)
213,015
-
21,709,988
(1,642,830)
22,874,704
(1,667,874)
-
70,665
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
230,248
-
(4,982)
(18,424)
145,899
366,888
218,383
13,545
278,158
1,229,715
19,785,507
61,496
19,847,003
21,076,718
-
262,381
(10,870)
(2,655)
(22,451)
184,318
334,592
218,383
10,395
236,244
1,210,337
19,854,143
213,015
20,067,158
21,206,830
70,665
NOTE 6: INCOME TAXES CONT.
(d) Deferred Tax Balances
2013
Loans and receivables
Other financial assets
prepayments / accrued income
pp & E
Share issue expenses
intangible patents and trademarks
Other intangibles
Accrued expenses
Employee entitlements
Unused tax losses
Revenue
Withholding tax
not recognised in current year
net balance
2012
Loans and receivables
Other financial assets
prepayments / accrued income
pp & E
Share issue expenses
intangible patents and trademarks
Other intangibles
Accrued expenses
Employee entitlements
Unused tax losses
Revenue
Withholding tax
not recognised in current year
net balance
59
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 6: INCOME TAXES CONT.
(e) Unrecognised Temporary Differences (including Tax Losses)
The following deferred tax assets have not been brought to account as assets:
unused revenue tax losses (no set expiry period)
Deductible temporary differences (no set expiry period)
unused foreign withholding tax credits (expire July 2013)
2013
$
2012
$
19,785,507
19,783,478
1,229,715
1,210,337
61,496
213,015
21,076,718
21,206,830
(f) Tax Consolidation
Relevance of tax consolidation to the group
The Company and all its wholly-owned Australian resident entities are part of a tax-consolidated group under Australian
taxation law. Bionomics is the head entity in the tax-consolidated group. Tax expense/benefit, deferred tax liabilities and
deferred tax assets arising from temporary differences of the members of the tax-consolidated group are recognised in
the separate financial statements of the members of the tax-consolidated group using the ‘separate taxpayer within group’
approach by reference to the carrying amounts in the separate financial statements of each entity and the tax values
applying under tax consolidation. Current tax liabilities and assets and deferred tax assets arising from unused tax losses
and relevant tax credits of the members of the tax-consolidated group are recognised by the Company (as head entity in
the tax-consolidated group).
NOTE 7: CASH AND CASH EQUIVALENTS
CURRENT
Cash at the end of the financial year as shown in the statements of cash flows is
reconciled to items in the balance sheet as follows:
Cash at bank and on hand
Deposits at call
Restricted deposits at call are held as security and are not available for use (see note 16):
3 Commercial bill line
3 Rental guarantee
3 Lease line
$550,000
$384,000
$215,000
NOTE 8: TRADE AND OTHER RECEIVABLES
CURRENT
Trade receivables
Allowance for doubtful debts
Other receivables
2013
$
2012
$
5,187,222
3,207,319
17,264,867
14,129,290
22,452,089
17,336,609
2013
$
2012
$
430,121
233,985
-
430,121
275,601
705,722
-
233,985
177,432
411,417
in determining the recoverability of a trade receivable, the Group considers any change in the credit quality of the trade
receivable from the date credit was initially granted up to the reporting date. The directors believe that there is no credit
provision required at 30 June 2013.
60
NOTE 9: OTHER FINANCIAL ASSETS
2013
$
2012
$
Financial Assets Carried at Fair Value Through Profit or Loss (FVTPL)
held for trading derivatives that are not designated in hedge accounting relationships
-
36,232
NOTE 10: INVENTORIES
CURRENT
Raw materials
NOTE 11: OTHER ASSETS
CURRENT
prepayments
Accrued interest and grants receivable / government assistance (note 4)
NOTE 12: SUBSIDIARIES
Details of the Group’s subsidiaries at the end of the reporting period are as follows:
2013
$
2012
$
98,526
135,284
2013
$
2012
$
422,513
349,290
7,000,000
3,108,852
7,422,513
3,458,142
PERCENTAGE OWNED
%
ENTITY
Head entity
PRINCIPAL ACTIVITY
COUNTRY OF
INCORPORATION
2013
2012
Bionomics Limited
Research and Development
Australia
Subsidiaries of Bionomics Limited:
neurofit SAS
Contract Research Organisation
france
iliad Chemicals pty Limited
Asset owner
Australia
Bionomics inc
Research and Development
united States
n/A
100
100
100
n/A
100
100
100
61
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 13: PROPERTY, PLANT AND EQUIPMENT
Gross carrying amount at 1 July 2011
Additions
Disposals
foreign currency exchange differences
Gross carrying amount at 30 June 2012
Additions
Disposals
foreign currency exchange differences
ADMINISTRATIVE
PLANT &
EQUIPMENT
$
SCIENTIFIC
PLANT &
EQUIPMENT
$
REFRIGERATION
PLANT &
EQUIPMENT
$
TOTAL
$
415,001
34,099
(42,423)
(13,777)
392,900
29,158
(2,663)
22,743
1,705,309
87,500
2,207,810
614,697
(58,891)
(7,002)
2,254,113
274,931
(3,982)
11,342
-
-
-
648,796
(101,314)
(20,779)
87,500
2,734,513
-
-
-
304,089
(6,645)
34,085
Gross carrying amount at 30 June 2013
442,138
2,536,404
87,500
3,066,042
Accumulated depreciation amount
at 1 July 2011
Disposals
foreign currency exchange differences
Depreciation (note 5)
Accumulated depreciation amount
at 30 June 2012
Disposals
foreign currency exchange differences
Depreciation (note 5)
Accumulated depreciation amount
at 30 June 2013
Net Carrying Amounts 30 June 2012
Net Carrying Amounts 30 June 2013
(311,887)
(1,505,719)
(87,500)
(1,905,106)
39,229
13,128
(34,616)
56,262
4,205
(134,368)
-
-
-
95,491
17,333
(168,984)
(294,146)
(1,579,620)
(87,500)
(1,961,266)
2,596
(19,120)
(37,817)
3,865
(11,362)
(200,088)
-
-
-
6,461
(30,482)
(237,905)
(348,487)
(1,787,205)
(87,500)
(2,223,192)
98,754
93,651
674,493
749,199
-
-
773,247
842,850
nOn-CuRREnT ASSETS pLEDGED AS SECuRiTY
Refer to note 16 for information on non-current assets pledged as security by the Company.
62
NOTE 14: INTANGIBLE ASSETS
Gross carrying amount at 1 July 2011
foreign currency exchange differences
GOODWILL
$
5,147,990
INTELLECTUAL
PROPERTY
$
TOTAL
$
6,806,632
11,954,622
-
(151,550)
(151,550)
Gross carrying amount at 30 June 2012
5,147,990
6,655,082
11,803,072
Additions (note 32)
foreign currency exchange differences
-
-
12,703,228
12,703,228
2,044,613
2,044,613
Gross carrying amount at 30 June 2013
5,147,990
21,402,923
26,550,913
Accumulated amortisation amount at 1 July 2011
foreign currency exchange differences
Amortisation (note 5)
Accumulated amortisation amount at 30 June 2012
foreign currency exchange differences
Amortisation
Accumulated amortisation amount at 30 June 2013
Net carrying amount 30 June 2012
Net carrying amount 30 June 2013
All intangible assets are held in the consolidated entity.
(a) Intellectual Property
-
-
-
-
-
-
-
(2,834,442)
(2,834,442)
79,309
(527,733)
79,309
(527,733)
(3,282,866)
(3,282,866)
(207,393)
(1,007,910)
(207,393)
(1,007,910)
(4,498,169)
(4,498,169)
5,147,990
5,147,990
3,372,216
8,520,206
16,904,754
22,052,744
The intellectual property includes the company’s Multicore® technology, its BnC105 compound, its BnC101 compound
and its kv1.3 compound with carrying amounts ranging from $0.7m to $14.5m. Each item is carried at its fair value as
at its date of acquisition, less accumulated amortisation charges. The remaining amortisation periods for each item are
between 5 and 20 years.
(b) Impairment Tests
Management tests annually whether goodwill or indefinite life intangibles have suffered any impairment, in accordance
with the accounting policy stated in note 1(m)(i) and (m)(ii). impairment testing is performed on each of the cash generating
units, which are the same as the reporting segments identified in note 3.
Determining whether goodwill or intangibles are impaired requires an estimation of the value in use of the cash generating
units to which goodwill or indefinite life intangibles have been allocated. The value in use calculation requires the entity
to estimate the future cash flows expected to arise from the cash generating unit and a suitable discount rate in order to
calculate present value. These discount rates range between 15% for lower risk cash flows and 25% for higher risk cash flows.
Allocation of Goodwill to CGU’s
The carrying amount of goodwill was allocated to the following CGu’s:
Drug discovery
Drug development
Contract services
2013
$
-
2012
$
-
5,147,990
5,147,990
-
-
63
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 14: INTANGIBLE ASSETS CONT.
DRuG DiSCOvERY
The recoverable amount of this CGu is determined based on a value in use calculation which uses cash flow projections based
on standard industry agreements for drug compounds within the cash generating unit over a period of up to 21 years covering
drug discovery, drug development, approval and marketing and a discount rate of 25% per annum (2012: 15% per annum).
The cash flow projections are weighted based on the probability of realising projected milestone and royalties payments.
Management believes that the application of discounted cash flows of standard industry agreements for drug compounds
is reasonable to be applied to other compounds within the CGu at their respective development phases.
Management believes that any reasonably possible change in the key assumptions on which recoverable amount is based
would not cause the aggregate carrying amount to exceed the aggregate recoverable amount of the CGu.
no growth rates have been included in the forecast. As the full development lifecycle has been taken into account with the
cashflows, no terminal value has been used.
DRuG DEvELOpMEnT
The recoverable amount of this CGu is also determined based on a value in use calculation which uses cash flow
projections based on standard industry agreements for drug compounds within the cash generating unit over a period of ten
years covering drug development, approval and marketing, and a discount rate of 25% per annum (2012: 15% per annum).
The cash flow projections are weighted based on the probability of realising projected milestone and royalties payments.
Management believes that the application of discounted cash flows of standard industry agreements for one drug
compound is reasonable to be applied to other compounds within the CGu at their respective development phases.
Management believes that any reasonably possible change in the key assumptions on which recoverable amount is based
would not cause the aggregate carrying amount to exceed the aggregate recoverable amount of the CGu.
no growth rates have been included in the forecast. As the full development lifecycle has been taken into account with the
cashflows, no terminal value has been used.
COnTRACT SERviCES
The recoverable amount of this CGu is determined based on a value in use calculation which uses cash flow projections
prepared by management over a five year period with an appropriate terminal value using a discount rate of 15%.
Annual growth rates of 0% (2012: 0%) per annum have been assumed in determining the cash flow projections.
Management believes that any reasonably possible change in the key assumptions on which recoverable amount is based
would not cause the aggregate carrying amount to exceed the aggregate recoverable amount of the CGu.
NOTE 15: TRADE AND OTHER PAYABLES
CURRENT
Trade payables
Accrued expenses
NON-CURRENT
Other payables
2013
$
2012
$
3,272,242
1,990,975
1,011,367
837,245
4,283,609
2,828,220
306,410
272,855
The average credit period on purchases of goods is 45 days. no interest is paid on the trade payables. The Group has financial
risk management policies in place to ensure that all payables are paid within the credit timeframe.
NOTE 16: BORROWINGS
SECURED – AT AMORTISED COST
Bank overdrafts
finance lease liabilities (i)
Equipment mortgage (ii)
Bank loan (iii)
Disclosed in the financial statements as:
Current liabilities
non-current liabilities
64
2013
$
-
442,941
87,594
550,000
2012
$
48,036
578,725
-
550,000
1,080,535
1,176,761
680,376
400,159
732,819
443,942
1,080,535
1,176,761
(i)
the lease lines are secured by the leased scientific equipment (refer note 24) and have an average interest rate of per
annum 7.11% (2012: 7.14% per annum) and terms of three to five years.
(ii) equipment mortgage for uS-based equipment with an interest rate of 3.25% and a three year term.
(iii) the rolling commercial bill line is secured by a restricted deposit at call of $550,000 (2012: $550,000).
The unused facilities available at 30 June 2013 of the Group’s bank overdraft is $56,980 (2012: $2,181). There is no unused
facility in relation to the commercial bill line.
Interest Rate Risk
The Group’s exposure to interest rates and the effective weighted average interest rate by maturity period is set out in note 22.
NOTE 17: PROVISIONS
CURRENT
Employee benefits
NON-CURRENT
Employee benefits
NOTE 18: OTHER LIABILITIES
CURRENT
unearned income
NOTE 19: ISSUED CAPITAL
(a) Issued and paid-up capital
Ordinary shares – fully paid
2013
$
2012
$
1,081,086
888,808
66,327
18,239
2013
$
37,447
37,447
2012
$
18,188
18,188
2013
SHARES
2012
SHARES
415,879,455
345,384,619
65
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 19: ISSUED CAPITAL CONT.
Movements in ordinary shares of the Company during the past two years were as follows:
DATE
DETAILS
30 June 2011
30 June 2012
30 June 2013
Closing balance
Share issue – ESOp option exercise
Share issue – ESOp option exercise
Share issue – ESOp option exercise
Share issue – ESOp option exercise
Share issue – ESOp option exercise
Share issue – ESOp option exercise
Share issue – ESOp option exercise
Share issue – ESOp option exercise
Share issue – ESOp option exercise
Share issue – ESOp option exercise
Closing balance
Share issue – ESOp option exercise
Share issue – ESOp option exercise
Share issue – ESOp option exercise
Share issue – ESOp option exercise
Share issue – ESOp option exercise
Share issue – ESOp option exercise
Share issue – ESOp option exercise
Share issue – acquisition
Share issue – entitlements issue
Share issue – entitlements issue costs
Shares to be issued – acquisition
Shares to be issued – acquisition
NUMBER OF
SHARES
344,731,779
340,000
90,000
35,000
54,000
30,000
5,150
15,000
12,000
5,000
66,690
345,384,619
340,000
20,526
110,000
122,500
200,000
150,000
15,000
19,112,575
45,634,962
-
1,197,322
3,591,951
415,879,455
ISSUE
PRICE
$0.13
$0.215
$0.22
$0.24
$0.28
$0.29
$0.2976
$0.36
$0.38
$0.5848
$0.13
$0.22
$0.24
$0.29
$0.30
$0.34
$0.36
$0.32
$0.36
-
$0.32
$0.32
$
87,690,990
44,200
19,350
7,700
12,960
8,400
1,494
4,464
4,320
1,900
39,000
87,834,778
44,200
4,516
26,400
35,525
60,000
51,000
5,400
6,116,024
16,428,586
(826,424)
383,143
1,149,424
111,312,572
Changes to the then Corporations Law abolished the authorised capital and par value concept in relation to share capital
from 1 July 1998. Therefore, the Company does not have a limited amount of authorised capital and issued shares do not
have a par value.
(b) Ordinary Shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion
to the number of and amounts paid on the shares held.
On a show of hands every holder of ordinary shares present at a meeting in person or by proxy, is entitled to one vote and
upon a poll each share is entitled to one vote.
(c) Share Options
When exercised, each option is convertible into one ordinary share. The exercise price is based on the weighted average price
at which the company’s shares traded on the ASX during the seven trading days immediately before the options are issued.
(i) The Bionomics ESOP
The terms and conditions of the Bionomics ESOp are summarised in note 1(p) (iv). The following options listed are
outstanding at reporting date.
NOTE 19: ISSUED CAPITAL CONT.
GRANT DATE
Jan-04
Mar-04
Sept-04
Jan-05
Jan-06
May-06
nov-06
Oct-07
Jan-08
Jul-08
Sep-08
nov-08
Jan-09
Mar-09
Jun-09
nov-09
EXPIRY DATE
Jan-14
Mar-14
Mar-14
nov-13
feb-14
feb-15
Jan-14
Jan-15
Jan-16
Jul-13
Jul-14
Jul-15
Jul-16
nov-13
nov-14
nov-15
nov-16
Oct-13
Oct-14
Oct-15
Oct-16
Oct-17
Jan-14
Jan-15
Jan-16
Jan-17
Jan-18
Jul-13
Jul-14
Jul-15
Jul-16
Jul-17
Jul-18
Sep-14
Sep-15
Sep-16
Sep-17
Sep-18
nov-13
nov-14
nov-15
nov-16
nov-17
nov-13
Aug-14
Aug-15
Aug-16
nov-14
nov-15
nov-16
nov-17
nov-18
Jan-14
Mar-15
Mar-16
Mar-17
Mar-18
Mar-19
Jun-14
Jun-15
Jun-16
Jun-17
Jun-18
Jun-19
nov-15
nov-16
nov-17
nov-18
nov-19
EXERCISE PRICE
$0.30
$0.37
$0.38
$0.24
$0.30
$0.30
$0.24
$0.24
$0.24
$0.22
$0.22
$0.22
$0.22
$0.30
$0.30
$0.30
$0.30
$0.29
$0.29
$0.29
$0.29
$0.29
$0.38
$0.38
$0.38
$0.38
$0.38
$0.36
$0.36
$0.36
$0.36
$0.36
$0.36
$0.34
$0.34
$0.34
$0.34
$0.34
$0.30
$0.30
$0.30
$0.30
$0.30
$0.37
$0.37
$0.37
$0.37
$0.28
$0.28
$0.28
$0.28
$0.28
$0.30
$0.29
$0.29
$0.29
$0.29
$0.29
$0.25
$0.25
$0.25
$0.25
$0.25
$0.25
$0.30
$0.30
$0.30
$0.30
$0.30
66
FAIR VALUE
AT GRANT DATE
$0.21
$0.16
$0.16
$0.14
$0.13
$0.13
$0.14
$0.15
$0.15
$0.13
$0.13
$0.13
$0.14
$0.12
$0.13
$0.13
$0.13
$0.21
$0.23
$0.23
$0.24
$0.25
$0.19
$0.20
$0.21
$0.22
$0.23
$0.16
$0.17
$0.18
$0.19
$0.19
$0.20
$0.17
$0.18
$0.19
$0.19
$0.20
$0.09
$0.10
$0.10
$0.11
$0.12
$0.07
$0.08
$0.09
$0.10
$0.06
$0.05
$0.06
$0.06
$0.07
$0.05
$0.06
$0.07
$0.07
$0.08
$0.08
$0.12
$0.13
$0.13
$0.14
$0.14
$0.15
$0.11
$0.12
$0.13
$0.14
$0.14
NUMBER
5,000
7,000
5,000
200,000
200,000
200,000
45,000
45,000
45,000
65,000
95,000
99,474
100,000
100,000
100,000
100,000
100,000
5,000
5,000
5,000
5,000
5,000
4,000
4,000
4,000
4,000
4,000
90,000
18,000
18,000
18,000
18,000
18,000
4,000
4,000
4,000
4,000
4,000
100,000
100,000
100,000
100,000
100,000
95,000
340,000
330,000
330,000
10,000
10,000
10,000
20,000
20,000
165,000
12,120
12,120
12,120
12,120
12,120
115,200
54,000
54,000
54,000
54,000
54,000
100,000
100,000
100,000
100,000
100,000
67
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 19: ISSUED CAPITAL CONT.
GRANT DATE
Jul-10
nov-10
nov-11
Dec-11
feb-12
Mar-12
Jun-12
Aug-12
Dec-12
Dec-12
Mar-13
May-13
Jun-13
EXPIRY DATE
July-15
Jul-16
Jul-17
Jul-18
Jul-19
Jul-20
nov-15
nov-16
nov-17
nov-18
nov-19
nov-16
nov-16
Aug-17
Dec-17
Dec-18
Dec-19
Dec-20
Dec-21
feb-18
feb-19
feb-20
feb-21
feb-22
Mar-18
Mar-19
Mar-20
Mar-21
Mar-22
Jun-18
Jun-19
Jun-20
Jun-21
Jun-22
Aug-17
Aug-18
Aug-19
Aug-20
Aug-21
Aug-22
Dec-17
Dec-18
Dec-19
Dec-20
Dec-21
Dec-22
Dec-18
Dec-19
Dec-20
Dec-21
Dec-22
Mar-19
Mar-20
Mar-21
Mar-22
Mar-23
May-19
May-20
May-21
May-22
May-23
Jun-19
Jun-20
Jun-21
Jun-22
Jun-23
EXERCISE PRICE
$0.32
$0.32
$0.32
$0.32
$0.32
$0.32
$0.31
$0.31
$0.31
$0.31
$0.31
$0.61
$0.61
$0.92
$0.52
$0.52
$0.52
$0.52
$0.52
$0.52
$0.52
$0.52
$0.52
$0.52
$0.51
$0.51
$0.51
$0.51
$0.51
$0.34
$0.34
$0.34
$0.34
$0.34
$0.29
$0.25
$0.25
$0.25
$0.25
$0.25
$0.29
$0.32
$0.32
$0.32
$0.32
$0.32
$0.32
$0.32
$0.32
$0.32
$0.32
$0.42
$0.42
$0.42
$0.42
$0.42
$0.37
$0.37
$0.37
$0.37
$0.37
$0.39
$0.39
$0.39
$0.39
$0.39
NUMBER
90,000
10,000
10,000
10,000
10,000
10,000
100,000
100,000
100,000
100,000
100,000
95,000
500,000
1,000,000
100,000
100,000
100,000
100,000
100,000
5,000
5,000
5,000
5,000
5,000
5,000
5,000
5,000
5,000
5,000
13,000
13,000
13,000
13,000
13,000
200,000
4,000
4,000
4,000
4,000
4,000
65,000
200,000
200,000
200,000
200,000
200,000
5,000
5,000
5,000
5,000
5,000
50,000
50,000
50,000
50,000
50,000
114,000
114,000
114,000
114,000
114,000
150,000
150,000
150,000
150,000
150,000
10,262,274
FAIR VALUE
AT GRANT DATE
$0.12
$0.11
$0.12
$0.13
$0.13
$0.14
$0.09
$0.10
$0.11
$0.12
$0.12
$0.15
$0.15
$0.03
$0.23
$0.25
$0.26
$0.27
$0.28
$0.20
$0.21
$0.22
$0.23
$0.24
$0.20
$0.21
$0.22
$0.23
$0.24
$0.11
$0.12
$0.13
$0.13
$0.14
$0.09
$0.13
$0.14
$0.15
$0.15
$0.16
$0.11
$0.12
$0.13
$0.14
$0.14
$0.15
$0.15
$0.16
$0.16
$0.17
$0.18
$0.14
$0.15
$0.16
$0.17
$0.18
$0.15
$0.16
$0.17
$0.18
$0.19
$0.14
$0.15
$0.16
$0.17
$0.18
68
NOTE 19: ISSUED CAPITAL CONT.
Reconciliation of ESOP:
2013
2012
NUMBER OF
OPTIONS
WEIGHTED
AVERAGE
EXERCISE PRICE
NUMBER
OF OPTIONS
WEIGHTED
AVERAGE
EXERCISE PRICE
Opening balance at beginning of financial year
Granted during the financial year
forfeited during the financial year
Exercised during the financial year
Expired during the financial year
Closing balance at 30 June
8,865,900
2,880,000
(50,000)
(958,026)
(475,600)
10,262,274
$0.40
$0.35
$0.34
$0.24
$0.30
$0.41
7,766,715
2,210,000
(8,000)
(586,150)
(516,665)
8,865,900
$0.31
$0.72
$0.36
$0.18
$0.52
$0.40
ESOP options exercised during the financial year:
SERIES
1-Sep-04
04-Oct-07
04-Oct-07
04-Oct-07
04-Oct-07
13-Jan-06
26-Sep-08
21-Jan-05
18-Oct-04
01-May-06
01-Jul-08
01-May-06
01-Jul-08
01-May-06
01-Jul-08
01-May-06
01-May-06
Unlisted options vested and exercisable at the reporting date
(iii) Weighted averages
NUMBER
EXERCISED
100,000
22,000
5,150
90,000
5,350
10,000
150,000
200,000
340,000
5,000
5,000
5,000
5,000
5,000
5,000
5,000
526
958,026
EXERCISE
DATE
SHARE PRICE AT
EXERCISE DATE
26-Sep-12
27-Sep-12
28-Sep-12
02-Oct-12
02-Oct-12
19-Dec-12
25-Jan-13
14-feb-13
14-Jun-13
24-Jun-13
24-Jun-13
25-Jun-13
25-Jun-13
25-Jun-13
25-Jun-13
25-Jun-13
25-Jun-13
$0.390
$0.385
$0.375
$0.360
$0.360
$0.350
$0.410
$0.430
$0.350
$0.335
$0.335
$0.315
$0.315
$0.315
$0.315
$0.315
$0.315
2013
NUMBER
6,617,154
2012
NUMBER
7,185,660
The weighted average remaining contractual life of any unlisted share options outstanding at the end of the year is
4.27 years (2012: 3.6 years).
The assessed fair value at grant date of options granted during the year ended 30 June 2013 is outlined in the
Remuneration Report on page 30. The share price at grant date of these options ranged between $0.29 and $0.39 (2012:
$0.30 and $0.58). The expected average price volatility of the company shares was 57% (2012: 60%). Expected dividend
yield was 0% (2012: 0%) and the average risk free interest rate used was 3.19% (2012: 3.51%). Additional details on options
granted in prior years are available in those year’s Annual Reports.
69
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 20: RESERVES
(a) Foreign Currency Translation Reserve
Exchange differences arising on translation of the foreign controlled entity are taken to the foreign currency translation
reserve, as described in note 1(b). The reserve is recognised in profit or loss when the investment is disposed of.
Opening balance
Exchange differences on translation of foreign operations
Closing balance
2013
$
(645,886)
1,894,514
1,248,628
2012
$
(552,274)
(93,612)
(645,886)
(b) Share-based Payments Reserve
The share-based payments reserve is used to recognise the fair value of options issued to the extent that they have vested.
Opening balance
Option expense
Closing balance
Total reserves
NOTE 21: ACCUMULATED LOSSES
Balance at the beginning of the year
net loss for the year
Balance at the end of the year
NOTE 22: FINANCIAL INSTRUMENTS
(a) Capital Risk Management
2013
$
1,533,134
136,908
2012
$
1,247,135
285,999
1,670,042
1,533,134
2,918,670
887,248
2013
$
2012
$
(62,822,909)
(59,686,671)
(10,001,350)
(3,136,238)
(72,824,259)
(62,822,909)
The Group manages its capital to ensure that entities in the Group will be able to continue as going concerns whilst
maximising the return to stakeholders through the optimisation of the debt and equity balance.
The Group’s overall strategy remains unchanged from 2012. The capital structure of the Group consists of debt, which
includes borrowings (note 16), cash and cash equivalents (note 7) and equity attributable to equity holders of the parent,
comprising issued capital, reserves and retained earnings (disclosed in notes 19, 20 and 21 respectively).
The Group has global operations, primarily conducted through subsidiary companies established in the markets in which
the Group trades. none of the Group’s entities is subject to externally imposed capital requirements.
The Group’s policy is to fund the research and development activities and operations through the issue of equity and the
commercialisation of intellectual property assets. Minor borrowings for operational assets are utilised, as appropriate.
NOTE 22: FINANCIAL INSTRUMENTS CONT.
CATEGORIES OF FINANCIAL INSTRUMENTS
Financial assets
Loans and receivables
Cash and cash equivalents
fair value through profit or loss (fvTpL)
held for trading
Financial liabilities
Amortised cost
Reconciliation to total assets
financial assets (as above)
non-financial assets
Reconciliation to total liabilities
financial liabilities (as above)
non-financial liabilities
70
2013
$
2012
$
742,371
411,417
22,452,089
17,336,609
-
36,232
23,194,460
17,784,258
5,053,760
5,053,760
4,081,133
4,081,133
23,194,460
17,784,258
30,416,632
13,317,930
53,611,092
31,102,188
5,053,760
7,150,349
4,081,133
1,121,938
12,204,109
5,203,071
(b) Financial Risk Management Objectives
The Board, through the Audit and Risk Management (ARM) Committee, is responsible for ensuring there are adequate
policies in relation to risk management, compliance and internal control systems. in summary, Company policies are
designed to ensure significant strategic, operational, legal, reputational and financial risks are identified, assessed, and
effectively monitored and managed in a manner sufficient for a company of Bionomics’ size and stage of development to
enable achievement of the Company’s business strategy and objectives.
The Company’s risk management policies are managed by the key management personnel and are reviewed by the ARM
Committee according to a timetable of assessment and review proposed by that Committee and approved by the Board.
(c) Market Risk
The Group’s activities do not expose it to significant financial risks of changes in foreign currency exchange rates or
interest rates. The Group uses derivative financial instruments to manage its exposure to foreign currency risk including:
3 forward foreign exchange contracts and currency swaps to hedge the exchange rate risk arising on the payments for
clinical trials in non-Australian dollar denominated contracts.
The Group measures market risk exposures using sensitivity analysis. There has been no material change to the Group’s
exposure to market risks or the manner in which these risks are managed and measured.
unless approved by the Chief Executive Officer and Managing Director and ARM Committee, interest rate derivatives are
not entered into.
(d) Foreign Currency Risk Management
The Group undertakes certain transactions denominated in foreign currencies; consequently exposures to exchange rate
fluctuations arise. Exchange rate exposures are managed in accordance with established policies. The carrying amounts
of the Group’s foreign currency denominated monetary assets and liabilities at the end of the reporting date are as follows:
71
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 22: FINANCIAL INSTRUMENTS CONT.
EuR
uSD
GBp
LIABILITIES
ASSETS
2013
$
2012
$
955,052
1,052,732
1,069,479
43,067
681,961
-
2013
$
2,107,512
358,542
-
2012
$
1,642,171
389,194
-
Foreign Currency Sensitivity Analysis
The Group is mainly exposed to Great Britain pounds, Euros and uS dollars.
The following table details the Group’s sensitivity to a 10% increase and decrease in the Australian dollar against the relevant
foreign currencies. 10% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel
and represents management’s assessment of the reasonably possible change in foreign currency rates. The sensitivity
analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the year-
end for a 10% change in foreign currency rates. A positive number below indicates an increase in profit or equity where the
Australian dollar strengthens 10% against the relevant currency. for a 10% weakening of the Australian dollar against the
relevant currency, there would be a comparable impact on the profit or equity with the balances being the opposite.
EUR IMPACT
USD IMPACT
GBP IMPACT
2013
$
10,828
2012
$
- (i)
2013
$
2012
$
59,717
26,615 (ii)
(115,597)
(53,585) (iii)
4,914 (v)
-
2013
$
3,915
-
2012
$
- (iv)
-
profit or loss
Equity
this is mainly attributable to the exposure outstanding on Euro payables in the Group at the end of the reporting period.
(i)
(ii) this is mainly attributable to the exposure to outstanding uSD net assets at the end of the reporting period.
(iii) this is as a result of the changes in fair value of the net investment in a subsidiary denominated in Euros, reflected in the
foreign currency translation reserve.
(iv) this is mainly attributable to the exposure outstanding on GBp payables in the Group at the end of the reporting period.
(v) this is as a result of the changes in fair value of the net investment in a subsidiary denominated in uSD, reflected in the
foreign currency translation reserve.
The Group’s sensitivity to foreign currency has increased during the current year mainly due to the mix of net assets held in
non-Australian dollar denominated currencies.
The sensitivity analysis may not represent the quantum of foreign exchange risk because the exposure at the end of the
reporting period does not reflect the exposure during the year. Requirements change during the financial year depending on
research and development activities being undertaken and contract research service financial performance.
Forward Foreign Exchange Contracts
it is the policy of the Group to enter into forward foreign currency contracts to cover specific foreign currency payments and
receipts when there is a legal commitment to pay or receive foreign currency or the Chief Executive Officer and Managing
Director has a high degree of confidence (>90%) that a foreign currency exposure will arise.
under the Group’s Treasury policy, the Chief financial Officer (CfO) will manage the foreign exchange transaction risk
adopting the following guidelines:
3 generally hedge foreign exchange exposure identified above by entering into a forward currency contract.
3 the duration of any forward currency contract(s) will approximate the period in which the net currency exposure arise.
3 recognising the uncertainty that exists in the projecting forward foreign currency flows, a maximum net foreign currency
exposure position may be held at any point in time.
72
NOTE 22: FINANCIAL INSTRUMENTS CONT.
Due to the long-term nature of the net investment in the Euro denominated wholly owned subsidiary, the investment will
not be hedged into Australian dollars, with the result that the Australia dollar value of the investment will fluctuate with the
market rate through the foreign currency translation reserve.
The following table details the forward foreign currency (fC) contracts outstanding at the end of the reporting period:
AVERAGE RATE
FOREIGN CURRENCY
CONTRACT VALUE
FAIR VALUE
EURO (Sell)
3 – 6 months
US (Buy)
Less than 3 months
3 – 6 months
2013
2012
2013
FC
-
-
-
-
1.0457
0.9568
-
-
-
2012
FC
-
2,000,000
250,000
2013
$
-
-
-
2012
$
-
1,912,905
261,288
2013
$
2012
$
-
-
-
-
-
50,158
(13,926)
36,232
The table above provides an example of summary quantitative data about exposure to foreign exchange risks at the end of the
reporting period that an entity may provide internally to key management personnel.
(e) Interest Rate Risk Management
The Group is exposed to interest rate risk as entities in the Group borrow funds at both fixed and variable interest rates
and lend funds at variable rates. The Group does not use interest rate swap contracts or forward interest rate contracts.
Interest Rate Sensitivity Analysis
The sensitivity analysis below has been determined based on the exposure to interest rates at the end of the reporting
period and the stipulated change taking place at the beginning of the financial year and held constant throughout the
reporting period.
if interest rates had been 50 basis points higher / (lower) and all other variables were held constant, the Group’s:
3 loss for the year ended 30 June 2013 would increase / (decrease) by $93,829 (2012: increase / (decrease) by $73,443).
This is mainly attributable to the Group’s exposure to interest rates on its variable rate deposits.
The Group’s sensitivity to interest rates has increased during the current year mainly due to the increase in cash and cash
equivalent balances and reduction in debt.
(f) Credit Risk Management
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the
Group. The Group has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral,
where appropriate, as a means of mitigating the risk of financial loss from defaults.
The Group does not have any significant credit risk exposure to any single counterparty or any group of counterparties
having similar characteristics. The credit risk on liquid funds is limited because the counterparties are banks with high
credit ratings assigned by international credit rating agencies.
The carrying amount of financial assets recorded in the financial statements, net of any allowances for losses, represents
the Group’s maximum exposure to credit risk.
(g) Liquidity Risk Management
ultimate responsibility for liquidity risk management rests with the Board, who have built an appropriate liquidity risk
management framework for management of the Group’s short, medium and long term funding. The Group manages
liquidity risk by continuously monitoring forecast and actual cash flows and matching maturity profiles of financial assets
and liabilities. included in note 16 is a listing of additional undrawn facilities that the group has at its disposal to further
reduce liquidity risk.
73
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 22: FINANCIAL INSTRUMENTS CONT.
(h) Liquidity and Interest Rate Risk
The following tables detail the Group’s remaining contractual maturity for its financial liabilities. The tables have been
drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Group can be
required to pay. The tables include both interest and principal cash flows.
INTEREST RATE MATURITY
WEIGHTED
AVERAGE
EFFECTIVE
INTEREST
RATE
%
LESS THAN
1 MONTH
$
1–3
MONTHS
$
3–12
MONTHS
$
1–5
YEARS
$
5+
YEARS
$
TOTAL
$
2013
non-interest bearing
finance lease liability
fixed interest rate
instruments
TOTAL
2012
non-interest bearing
forward exchange
contracts (payable)
forward exchange
contracts (receivable)
finance lease liability
fixed interest rate
instruments
TOTAL
3,973,225
-
-
-
7.11
12,571
25,142
113,139
347,591
3.81
550,000
-
7,002
4,535,796
25,142
120,141
80,592
428,183
2,681,517
-
-
487,805
1,425,100
261,288
(493,754)
(1,469,309)
(247,362)
-
-
-
7.14
13,387
38,388
119,670
498,443
4.31
550,000
-
-
-
3,238,955
(5,821)
133,596
498,443
-
-
-
-
-
-
-
-
-
-
3,973,225
498,443
637,594
5,109,262
2,681,517
2,174,193
(2,210,425)
669,888
550,000
3,865,173
NOTE 23: KEY MANAGEMENT PERSONNEL DISCLOSURES
(a) Directors
The following persons were directors of Bionomics during the financial year and prior year unless otherwise stated:
Non-Executive Chairman
Mr Graeme kaufman (appointed 18 September 2012)
Executive Director
Dr Deborah Rathjen, Chief Executive Officer and Managing Director
Non-Executive Directors
Mr Trevor Tappenden
Dr Errol De Souza
Dr Jonathan Lim (appointed 14 September 2012)
Mr Christopher fullerton (retired 31 December 2012)
(b) Other Key Management Personnel
The following persons also had authority and responsibility for planning, directing and controlling the activities of the
Group directly or indirectly during the financial year:
NAME
Dr José iglesias
Ms Melanie Young
POSITION
Chief Medical Officer
Chief financial Officer and Company Secretary
74
NOTE 23: KEY MANAGEMENT PERSONNEL DISCLOSURES CONT.
(c) Key Management Personnel Compensation
The aggregate compensation made to key management personnel of the Group is set out below:
Short-term employee benefits
post-employment benefits
Share-based payments
Total key management personnel compensation
NOTE 24: COMMITMENTS FOR EXPENDITURE
(a) Finance Leases
2013
$
2012
$
1,245,426
1,433,265
49,778
96,025
76,115
215,664
1,391,229
1,725,044
The Group leases scientific equipment under finance leases. The average lease term is four years (2012: four years).
under the terms of the lease, the Group retains ownership at the completion of the agreed term. interest rates underlying
all obligations under finance leases are fixed at the respective contract dates ranging from 4.5% to 7.29%
(2012: 7.1% to 8.9%) per annum.
MINIMUM LEASE
PAYMENTS
PRESENT VALUE OF LEASE
PAYMENTS
FINANCE LEASE LIABILITIES
Within one year
Later than one year but not greater than five
future finance charges
Present value of minimum lease payments
2013
$
150,852
435,128
585,980
(55,445)
530,535
2012
$
171,445
498,443
669,888
(91,163)
578,725
Represented in the financial statements (note 16) by:
Current borrowings
non-current borrowings
(b) Operating Leases
2013
$
122,885
407,650
530,535
-
2012
$
134,783
443,942
578,725
-
530,535
578,725
2013
$
130,376
400,159
530,535
2012
$
134,783
443,942
578,725
Operating leases relate to business premises with lease terms of between two and ten years. The building premise leases
have options of +2 and +5+5 year terms respectively.
PAYMENTS RECOGNISED AS AN EXPENSE
Minimum lease payments
NON-CANCELLABLE OPERATING LEASE COMMITMENTS
Within one year
Later than one year but not greater than five
Later than five years
Minimum lease payments
2013
$
2012
$
850,955
894,252
1,003,196
4,095,463
2,575,996
7,674,655
885,505
3,745,267
3,531,191
8,161,963
75
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 24: COMMITMENTS FOR EXPENDITURE CONT.
The non-cancellable lease commitments include the rent payable under the sale and leaseback of the headquarters.
The sale occurred on 29 April 2011, with settlement occurring on 13 July 2011. The total lease commitments are expected to be
$6,392,784 (2012: $7,229,077), and are considered market related.
(b) Rental Agreements
The Group sub-lets areas of its facility under agreements that are renewed annually. Rent received from these
agreements is treated according to the accounting policy outlined in note 1(c).
FUTURE RENTAL INCOME RECEIVABLE
Within one year
Later than one year but not greater than five
2013
$
155,369
-
155,369
2012
$
173,219
157,870
331,089
NOTE 25: EVENTS OCCURRING AFTER REPORTING DATE
no matters or circumstances have arisen since the end of the financial year which significantly affect or may significantly
affect the results of the operations of the Group, except as noted below.
On 31 July 2013 Bionomics announced an agreement with Merck, known as MSD outside the united States and Canada,
to discover and develop novel small molecule candidates for the treatment of chronic pain. Merck will have the option to
exclusively license a compound from Bionomics for development and commercialisation. in return, Bionomics may receive
option exercise fees and development and regulatory milestone payments of up to uS$172 million. Bionomics may also be
eligible for undisclosed royalties on net sales of products from the collaboration.
NOTE 26: REMUNERATION OF AUDITORS
During the financial year the following services were paid and payable to the external auditor:
AUDITOR OF THE PARENT ENTITY
Audit or review of the financial report
Tax compliance including preparation of the income tax return
Other non-audit services
The auditor of Bionomics Limited is Deloitte Touche Tohmatsu.
2013
$
158,566
6,300
12,798
2012
$
130,535
16,900
12,805
177,664
160,240
it is the Group’s practice to employ Deloitte Touche Tohmatsu on assignments additional to their statutory audit duties where
their expertise and experience with the Group are important.
NOTE 27: CASH FLOW INFORMATION
Reconciliation of operating loss after income tax to net cash outflow from operating activities
Loss for the year after income tax
items in loss
- Depreciation and amortisation
- Share-based payments
- income tax expense/(benefit)
- net unrealised foreign exchange differences
2013
$
2012
$
(10,001,350)
(3,136,238)
1,245,815
136,908
38,175
869,526
696,717
324,999
(192,658)
(145,655)
76
2013
$
(7,016,607)
2012
$
-
(1,037,151)
(1,123,099)
204,317
3,907,756
(56,616)
36,758
240,366
19,259
(1,495,733)
-
(111,830)
(96,413)
101,120
(33,815)
1,362,138
1,198,463
(10,050,706)
(4,014,142)
2013
$
-
-
2013
CENTS
(2.7)
(2.7)
2012
$
648,796
648,796
2012
CENTS
(0.9)
(0.9)
NOTE 27: CASH FLOW INFORMATION CONT.
- Accrued grant income
- interest received / receivable
Changes in operating assets and liabilities
- Decrease/(increase) in debtors and other assets
- Decrease/(increase) in accrued income
- increase in other operating assets
- Decrease/(increase) in inventory
- Movement in provisions
- increase/(Decrease) in unearned income
- increase in creditors and accruals
Net cash outflows from operating activities
NOTE 28: NON-CASH FINANCING ACTIVITIES
Acquisition of equipment under a finance lease
NOTE 29: LOSS PER SHARE
Basic loss per share
Diluted loss per share
The basic and diluted loss per share amounts have been calculated using the ‘Loss after income tax’ figure in the consolidated
statement of comprehensive income.
LOSS PER SHARE (BASIC AND DILUTED):
Loss after tax for the year
2013
$
2012
$
(10,001,350)
(3,136,238)
2013
NUMBER
2012
NUMBER
Weighted average number of shares - Basic
Weighted average number of ordinary shares used in calculating basic loss per share:
374,438,730
344,928,141
Weighted average number of shares – Diluted
Weighted average number of ordinary shares used in calculating basic loss per share:
374,438,730
344,928,141
Shares deemed to be issued for no consideration in respect of:
- Employee options
Weighted average number of ordinary shares used in the calculation of diluted
earnings per share
468,564
2,060,462
374,907,294
346,988,603
The following potential ordinary shares are anti-dilutive and are therefore excluded from the weighted average number of
ordinary shares for the purposes of diluted earnings per share.
Employee options
2013
NUMBER
5,107,000
2012
NUMBER
2,155,000
77
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 30: RELATED PARTY TRANSACTIONS
(a) Parent Entity
The immediate parent and ultimate controlling party of the Group is Bionomics Limited. interests in subsidiaries are set
out in note 12.
(b) Key Management Personnel
Disclosures relating to compensation of key management personnel are set out in note 23 and the Directors’ Report.
(c) Other Transactions with Related Parties
Transactions between the Group and its related parties
During the financial year ended 30 June 2013, the following transactions occurred between the Group and its other related
parties:
3 research and development services between the parent and subsidiary entities totalled $4,246,642 (2012: $917,543).
3 corporate support fees were charged between the Group’s entities of $1,091,000 (2012: $281,356) for management and
accounting support.
The following balances arising from transactions between the Group and its other related parties are outstanding at
reporting date:
3 loan receivables totalling $1,124,647 (2012: $755,710) are payable by the subsidiaries to the parent entity.
All amounts advanced to or payable to related parties are unsecured and are subordinate to other liabilities. interest has
been waived since 2010.
The amounts outstanding will be settled in cash. no guarantees have been given or received. no expense has been
recognised in the period for bad or doubtful debts in respect of the amounts owed by related parties.
Transactions between the Group and its associates were eliminated in the preparation of the consolidated financial
statements of the Group to the extent of the Group’s share in profits and losses of the associate resulting from these
transactions.
(d) Loans To and From Related Parties
no loans to or from related parties have occurred in the current or previous financial year.
(e) Key Management Personnel Equity Holdings
(i) Options provided as remuneration and shares issued on the exercise of such options are outlined below, and the terms
and conditions of the options can be found in note 1(p)(iv).
(ii) The number of unlisted options over ordinary shares in the company held by each director of the company and other
key management personnel (including related parties) of the Group are set out below. All options that are vested are
exercisable.
2013
OPTIONS
NAME
Mr Graeme kaufman
Dr Deborah Rathjen
Mr Trevor Tappenden1
Dr Errol De Souza
Dr Jonathan Lim
BALANCE AT
THE START
OF THE YEAR
-
3,120,000
500,000
500,000
-
-
-
500,000
Mr Christopher fullerton3
1,000,000
Ms Melanie Young
Dr José iglesias
500,000
-
-
75,000
500,000
GRANTED
DURING THE
YEAR AS
COMPEN-
SATION
EXERCISED
DURING THE
YEAR
NET OTHER
CHANGES
DURING THE
YEAR
BALANCE AT
YEAR END
VESTED AND
EXERCISABLE
AT YEAR END
500,000
65,000
-
(430,000)
-
-
500,000
-
2,755,000
2,755,000
-
-
-
-
-
-
(100,000)
-
-
(1,000,000)
-
-
400,000
500,000
500,000
-
575,000
500,000
400,000
500,000
-
-
175,000
-
5,620,000
1,640,000
(430,000)
(1,100,000)
5,730,000
3,830,000
78
NOTE 30: RELATED PARTY TRANSACTIONS CONT.
2012
OPTIONS
NAME
Mr Christopher fullerton
Dr Deborah Rathjen2
Mr Trevor Tappenden1
Dr Errol De Souza
Ms Melanie Young
BALANCE AT
THE START
OF THE YEAR
1,000,000
1,965,000
500,000
500,000
GRANTED
DURING THE
YEAR AS
COMPEN-
SATION
EXERCISED
DURING THE
YEAR
NET OTHER
CHANGES
DURING THE
YEAR
BALANCE AT
YEAR END
VESTED AND
EXERCISABLE
AT YEAR END
-
-
-
1,595,000
(340,000)
(100,000)
-
-
-
500,000
-
-
-
-
-
-
1,000,000
3,120,000
500,000
500,000
500,000
400,000
3,120,000
500,000
400,000
-
3,965,000
2,095,000
(340,000)
(100,000)
5,620,000
4,420,000
1held by kelso investments Australia pty Ltd
2includes 1,000,000 options vested August 2012 to Dr Deborah Rathjen for services performed in 2011/2012
3Mr Christopher fullerton retired 31 December 2012 and is no longer disclosed
(iii) The number of shares in the company held by each director of the Company and other key management personnel
(including personally related parties) of the Group are set out below:
2013
SHARES
NAME
Mr Graeme kaufman
Dr Deborah Rathjen
Mr Trevor Tappenden2
Dr Errol De Souza
Dr Jonathan Lim
Mr Christopher fullerton1, 3
Ms Melanie Young
Dr José iglesias
2012
SHARES
NAME
Mr Christopher fullerton1
Dr Deborah Rathjen
Mr Trevor Tappenden2
Dr Errol De Souza
Ms Melanie Young
BALANCE AT
THE START OF
THE YEAR
GRANTED
DURING THE
YEAR AS
COMPEN-
SATION
RECEIVED
DURING THE
YEAR UPON
EXERCISE OF
OPTIONS
NET OTHER
CHANGES
DURING THE
YEAR
-
1,533,689
220,000
116,698
-
4,200,000
18,710
-
6,089,097
-
-
-
-
-
-
-
-
-
BALANCE AT
YEAR END
178,750
1,965,401
247,500
116,698
178,750
1,712
27,500
-
4,073,463
4,073,463
(4,200,000)
20,339
-
-
39,049
-
-
430,000
-
-
-
-
-
-
430,000
101,764
6,620,861
BALANCE AT
THE START OF
THE YEAR
GRANTED
DURING THE
YEAR AS
COMPEN-
SATION
RECEIVED
DURING THE
YEAR UPON
EXERCISE OF
OPTIONS
NET OTHER
CHANGES
DURING THE
YEAR
4,825,020
1,343,689
245,899
116,698
-
6,531,306
-
-
-
-
1,710
1,710
-
340,000
-
-
-
(625,020)
(150,000)
(25,899)
-
17,000
BALANCE AT
YEAR END
4,200,000
1,533,689
220,000
116,698
18,710
340,000
(783,919)
6,089,097
1held by Mandalay Capital pty Ltd
2held by kelso investments Australia pty Ltd
3Mr Christopher fullerton retired 31 December 2012 and is no longer disclosed
79
NOTES TO THE
FINANCIAl STATEMENTS FOR THE FINANCIAl YEAR ENDED 30 JuNE 2013
NOTE 30: RELATED PARTY TRANSACTIONS CONT.
(f) Loans to Directors and Other Key Management Personnel
There were no loans to any directors of the Company or other key management personnel of the Group during the financial
year ended 30 June 2013.
(g) Other Transactions with Directors and Other Key Management Personnel
There were no other transactions with directors of the Company or other key management personnel of the Group during
the financial year.
NOTE 31: PARENT ENTITY INFORMATION
The accounting policies of the parent entity, which have been applied in determining the financial information shown below,
are the same as those applied in the consolidated financial statements. Refer to note 1 for a summary of the significant
accounting polices relating to the Group.
FINANCIAL POSITION
ASSETS
Current assets
non-current assets
Total assets
LIABILITIES
Current liabilities
non-current liabilities
Total liabilities
Net Assets
EQUITY
issued capital
Accumulated losses
Share-based payments reserve
Total equity
FINANCIAL PERFORMANCE
Loss for the year
Other comprehensive income
Total comprehensive income
YEAR ENDED
30 JUNE 2013
$
YEAR ENDED
30 JUNE 2012
$
31,203,186
21,566,896
20,750,731
9,463,051
51,953,917
31,029,947
5,287,458
5,096,108
3,837,756
462,181
10,383,566
4,299,937
41,570,351
26,730,010
111,312,572
87,834,778
(71,412,263)
(62,637,902)
1,670,042
1,533,134
41,570,351
26,730,010
YEAR ENDED
30 JUNE 2013
YEAR ENDED
30 JUNE 2012
(8,774,362)
(2,777,626)
-
-
(8,774,362)
(2,777,626)
(a) Property, Plant and Equipment Commitments
There are no contractual commitments for the acquisition of property, plant or equipment as at 30 June 2013 (2012: nil).
(b) Contingent Liabilities and Guarantees
There are no contingent liabilities or guarantees as at 30 June 2013 (2012: nil).
NOTE 32: BUSINESS COMBINATIONS – ACQUISITION OF ECLIPSE THERAPEUTICS, INC
On 17 September 2012 the Company announced the acquisition of Eclipse Therapeutics, inc into the wholly owned subsidiary
Bionomics inc with effect from 14 September 2012. Bionomics inc is engaged in Cancer Stem Cell research and development
activities and is complementary to the Group’s existing oncology research and development program.
80
NOTE 32: BUSINESS COMBINATIONS - ACQUISITION OF ECLIPSE THERAPEUTICS, INC CONT.
CONSIDERATION TRANSFERRED
Shares issued
Shares issuable (estimated maximum)
Cash
Total consideration
Contingent consideration (i)
NUMBER
19,112,575
4,778,143
-
$
6,116,024
1,532,567
14,246
23,890,718
7,662,837
4,681,749
12,344,586
(i) The contingent consideration is the estimated fair value of the potential cash earn-outs to Eclipse security holders
based on achieving late stage development success or partnering outcomes based on Eclipse assets. The contingent
consideration of $4,681,749 at the acquisition date has been revalued at 30 June 2013 due to the movement in the
uS / Australian dollar exchange rate to $5,348,695.
ASSETS ACQUIRED AND LIABILITIES ASSUMED AT THE DATE OF ACQUISITION
CURRENT ASSETS
Cash and cash equivalents
Other current assets
NON-CURRENT ASSETS
plant and equipment
intellectual property
CURRENT LIABILITIES
Trade and other payables
$
270,525
7,256
109,853
12,703,228
(746,276)
12,344,586
in accordance with the Accounting Standard AASB 3 ‘Business Combinations’, the Company is able to provisionally determine
the initial accounting for the acquisition. At the end of the year, the intangible assets have been provisionally determined based
on the directors’ best estimate of the likely fair value at $12,703,228. The calculation of the consideration transferred and
intangible assets, including but not limited to intellectual property, goodwill and deferred tax assets may be amended when
further information to support these values is obtained.
included in the loss for the year ended 30 June 2013 is $1,927,691 attributable to this acquisition. had the acquisition been
effected at 1 July 2012, the loss from continuing operations for the year would have increased by an additional $280 thousand,
the ‘pro-forma’ loss.
in determining the ‘pro-forma’ loss of the Group had Eclipse Therapeutics, inc been acquired at the beginning of the year, the
directors have:
3 calculated depreciation of plant and equipment acquired on the basis of the fair values arising in the initial accounting for
the business combination rather than the carrying amounts recognised in the pre-acquisition financial statements;
3 included savings for work performed within the Group rather than outsourced; and
3 assumed a similar rate of progress for research and development.
81
DIRECTORS’
DEClARATION
THE DIRECTORS DECLARE THAT:
a)
in the directors’ opinion, there are reasonable grounds to believe that the Company will be able to pay its debts as and
when they become due and payable;
b) the attached financial statements are in compliance with international financial Reporting Standards issued by the
international Accounting Standards Board, as stated in note 1 to the financial statements;
c)
in the directors’ opinion, the attached financial statements and notes thereto are in accordance with the Corporations
Act 2001, including compliance with accounting standards and giving a true and fair view of the financial position and
performance of the consolidated entity; and
d) the directors have been given the declarations required by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of the directors made pursuant to section 295(5) of the Corporations Act 2001.
On behalf of the directors
Graeme Kaufman
Chairman
Deborah Rathjen
Chief Executive Officer and Managing Director
Dated this 15th day of August 2013
82
INDEPENDENT
AuDIT REPORT
83
INDEPENDENT
AuDIT REPORT
84
SHAREHOlDER
INFORMATION
All shareholder information provided is current as at 18 September 2013.
DiffEREnCE in RESuLTS REpORTED TO ThE ASX
There are no material differences between the figures reported in the financial statements and those lodged with the ASX in
the Company’s Appendix 4E for the year ended 30 June 2013, other than those previously announced to the market.
AuDiT AnD RiSk MAnAGEMEnT COMMiTTEE
The Company established an Audit and Risk Management Committee in July 2002. The main responsibilities of the Audit and
Risk Management Committee are set out in the section headed ‘Corporate Governance Statement’ of the Annual Report.
CORpORATE GOvERnAnCE
Bionomics’ corporate governance practices are set out in the section headed ‘Corporate Governance Statement’ of the
Annual Report.
SuBSTAnTiAL ShAREhOLDERS
Substantial holders in the Company are set out below:
ORDINARY SHARES
Link Traders (Aust) pty Ltd
John Leaver
Ausbil Dexia Limited
The Australian national university
NUMBER HELD
34,624,622
24,241,071
24,000,000
21,642,425
EquiTY SECuRiTiES
There are 4,085 holders of ordinary shares in Bionomics.
The number of shareholdings held in less than marketable parcels is 249.
vOTinG RiGhTS
There is one class of quoted equity securities issued by the Company, ordinary, with voting rights attached to the ordinary
shares. One share equates to one vote.
DiSTRiBuTiOn Of hOLDERS Of EquiTY SECuRiTiES
CATEGORY (SIzE OF HOLDING)
ORDINARY SHARES
UNLISTED OPTIONS
NUMBER OF SECURITY HOLDERS
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – and over
407
1,214
691
1,460
313
4,085
-
3
3
28
16
50
85
SHAREHOlDER
INFORMATION
TWEnTY LARGEST hOLDERS Of EACh CLASS Of quOTED EquiTY SECuRiTiES
The names of the 20 largest holders of each class of quoted equity securities are listed below:
ORDINARY SHARES
NAME
national nominees Limited
Link 405 pty Ltd
hSBC Custody nominees (Australia) Limited
The Australian national university
CvC Limited
hSBC Custody nominees (Australia) Limited–GSCO ECA
hSBC Custody nominees (Australia) Limited
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