Noxopharm
Annual Report 2021

Plain-text annual report

Noxopharm Limited (ASX:NOX) | ASX Announcement | 10 September 2021 Noxopharm Annual Report Year Ended 30 June 2021 Sydney 10 September 2021: Australian clinical-stage drug development company Noxopharm Limited (ASX:NOX) is pleased to release its Annual Report for the 12 months ended 30 June 2021. Commenting on the Company’s progress and outlook, CEO and Managing Director, Dr Graham Kelly said, “The major outcome from the past Financial Year has been a glimpse into the uniqueness and substantial potential of our isoflavonoid technology platform. From data showing us having what we believe could be the most effective means of turning tumours from ‘cold’ to ‘hot’, to the LuPIN data showing a strong enhancing effect of radioligand therapy, to what appears to be a successful anti-inflammatory effect in COVID-19 patients, to discovering molecules with the potential to block growth signals driving aggressive growth of cancers of the brain and pancreas. The progress in that year means we go into the current financial year with clear therapeutic and commercial strategies. Our IONIC trial has started to screen patients and DARRT-2 will be doing the same shortly. Our CEP-2 (sarcoma) study is scheduled to open Q4 2021. We are reviewing the clinical strategies for both a LuPIN-2 study and a Phase 2 NOXCOVID study with strong intentions of undertaking both this current financial year predominantly through non- dilutive funding. We also have an exciting anti-inflammatory drug discovery program underway with our subsidiary, Pharmorage. The 2020/2021 financial year was highly productive. The next financial year looks like being even more so.” A full copy of the 2021 Annual Report is attached and will be available here: Investor Centre | Noxopharm -ENDS- Graham Kelly, CEO and Managing Director of Noxopharm, has approved the release of this document to the market on behalf of the Board of Directors. Noxopharm Limited. ABN 50 608 966 123 Level 20, Tower A, The Zenith, 821 Pacific Highway, Chatswood NSW 2067 AUSTRALIA About Noxopharm Noxopharm Limited (ASX:NOX) is an Australian clinical-stage drug development company focused on the treatment of cancer and cytokine release syndrome (septic shock). Veyonda® is the Company’s first pipe-line drug candidate currently in Phase 2 clinical trialling. Veyonda® has two main drug actions – a moderating effect on the ceramide/sphingosine-1-phosphate balance and inhibition of its dual-acting oncotoxic and STING signalling. Activity against the former target contributes to immunomodulatory functions designed to enhance the effectiveness and safety of standard oncology treatments, i.e., chemotherapies, radiation therapies and immune checkpoint inhibitors. Activity against the latter target provides an anti-inflammatory effect, as well as contributing to an anti-cancer action, but also potentially blocking septic shock. Noxopharm is running comprehensive drug discovery programs in both oncology and inflammation, and is the major shareholder of US biotechnology company, Nyrada Inc (ASX:NYR), active in the areas of drug development for cardiovascular and neurological diseases. To learn more, please visit: noxopharm.com Investor, Corporate & Media enquiries: Company Secretary: Prue Kelly David Franks M: 0459 022 445 T: +61 2 8072 1400 E: info@noxopharm.com E: David.Franks@automicgroup.com.au Forward Looking Statements This announcement may contain forward-looking statements. You can identify these statements by the fact they use words such as “aim”, “anticipate”, “assume”, “believe”, “continue”, “could”, “estimate”, “expect”, “intend”, “may”, “plan”, “predict”, “project”, “plan”, “should”, “target”, “will” or “would” or the negative of such terms or other similar expressions. Forward-looking statements are based on estimates, projections and assumptions made by Noxopharm about circumstances and events that have not yet taken place. Although Noxopharm believes the forward-looking statements to be reasonable, they are not certain. Forward-looking statements involve known and unknown risks, uncertainties and other factors that are in some cases beyond the Company’s control (including but not limited to the COVID-19 pandemic) that could cause the actual results, performance or achievements to differ materially from those expressed or implied by the forward- looking statement. Noxopharm Limited. ABN 50 608 966 123 Level 20, Tower A, The Zenith, 821 Pacific Highway, Chatswood NSW 2067 AUSTRALIA Annual Report For the year ended 30 June 2021 DELIVERING SCIENCE. TRANSFORMING LIVES. Noxopharm Limited ABN 50 608 966 123 For an offer of up to #,000,000 Shares at an issue price of $# per Share to raise up to $#,000,000. NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 2 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 CONTENTS Chairman’s Letter Noxopharm CEO and Operations Report 2021 Directors’ Report Auditor’s Independence Declaration Annual Financial Report - 30 June 2021 Consolidated Statement of Profit or Loss and Other Comprehensive Income Consolidated Statement of Financial Position Consolidated Statement of Changes in Equity Consolidated Statement of Cash Flows Notes to the Financial Statements Directors' Declaration Independent Auditor's Report to the Members Shareholder Information 4 5 9 23 24 25 27 28 29 30 54 55 59 3 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 CHAIRMAN’S LETTER Dear Shareholders, I am pleased to share with you the highlights of the last financial year which was indeed, a transformative year for the Company. At the beginning of the year, Noxopharm had a market capitalisation of ~A$39 million dollars and a share price of A$0.18. At the close of the year on 30 June, the market capitalisation was ~A$186 million and a share price finishing at A$0.64 cents. Four events this reporting period are highlights for me: 1. Pre-clinical studies conducted in universities in Germany and Hong Kong showing that idronoxil had the capacity to restore immune function to tumours. This is the co-called COLD to HOT tumour conversion that is seen as the crux to getting cancer to respond to any form of therapy. This discovery is the basis of our IONIC clinical trial with the involvement of Bristol Myers Squibb and their multi-billion drug, nivolumab (Opdivo®). 2. The pre-clinical discovery by Melbourne’s Hudson Institute of Medical Research that idronoxil blocked the STING pathway responsible for triggering inflammatory responses to viral infections. Over-reaction by STING to the SARS-CoV-2 virus is thought to lead to a lot of morbidity and mortality in COVID-19 disease, so it made sense for us to test our lead drug candidate, Veyonda® in COVID-19 patients. I need to compliment our clinical team in planning and activating the NOXCOVID clinical trial in Eastern Europe within 6 months. 3. Completion of the LuPIN trial in late-stage prostate cancer patients at St Vincent’s Hospital in Sydney. This trial tested the safety and early efficacy of a combination treatment using Veyonda® and the giant Swiss pharmaceutical Novartis-owned radionuclide, 177 Lutetium- PSMA-617 (LuPSMA). The trial’s final data (presented in February this year) at the internationally recognised American Society of Clinical Oncology Genitourinary Cancers Symposium (ASCOGU) showed an unprecedented 19.7 months median overall survival (mOS) for the trial patients who had no further remaining treatment options. 4. The successful A$23 million fund-raising by Canaccord Genuity in December last year and the conversion of convertible notes by major shareholders meant Noxopharm closed the 2021 financial year with ~A$27 million in the bank and with no debt. We go into the 2021/2022 FY in a strong cash position enabling us to proceed with the exciting Four Pillars Oncology Program. This program is using Veyonda® to enhance four different kinds of cancer treatment, one of them the IONIC trial combining Veyonda® with Opdivo® (Bristol Myers Squibb (NYSE:BMY). We also have established the subsidiary, Pharmorage, to house the growing collaboration with Hudson Institute of Medical Research, Australia’s pre-eminent research body in inflammatory diseases. I predict you will be hearing a lot more about this collaboration in the coming year. Finally, the Company and its Board go into the new financial year with a high degree of confidence that Veyonda® will be the so-called “missing link” needed to enhance other existing treatments for cancer and bring hope to those suffering from this disease. I am hopeful that our shareholders who have had the faith to invest in Noxopharm shall continue to do so and in doing this, so reap the rewards of their investment. Yours sincerely, Fred Bart, Chairman 4 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOXOPHARM CEO AND OPERATIONS REPORT 2021 SUMMARY OF ACTIVITIES Noxopharm Limited (ASX:NOX) is an Australian clinical-stage drug development company which is focused on discovering and developing therapies for cancer and inflammation. The lead drug candidate is idronoxil (Veyonda®). This past Financial Year has been marked by a considerably greater understanding of how idronoxil works, along with that of the broader technology platform that it comes from. That better understanding has brought into clearer focus • • • • the therapeutic opportunities on offer the preferred intellectual property strategy the commercial opportunities, and likely strategic partners. A wide range of pre-clinical collaborations and clinical trial read-outs this past reporting period have led the Company to realise the extent of opportunity it has in potentially meeting a range of urgent medical needs across the spectrum of human degenerative disease. The Company gave considerable thought to this opportunity and determined the following strategies: 1. The so-called ‘4 Pillars Oncology’ clinical development strategy for Veyonda based on the concept of using the broad anti- cancer properties of idronoxil to allow Veyonda to be used to enhance the effectiveness of other commonly-used anti-cancer treatments 2. The use of the unique anti-inflammatory/immune-sparing properties of idronoxil to position Veyonda as a treatment of early- stage COVID-19 disease 3. To use the drug technology platform to develop a pipeline of drugs that block ‘helper’ signals from healthy support cells to target those tumours such as brain and pancreatic cancers that display highly aggressive growth, and 4. To use the drug technology platform to develop a pipeline of drugs with unique anti-inflammatory actions to target a range of inflammatory diseases, and to house this opportunity in the subsidiary, Pharmorage, in a partnership with Hudson Institute of Medical Research. The Company’s business activities remained based on collaborations with universities and research institutions, along with commercial service providers. The Company seeks to engage with leaders in their field. The virtual nature of the Company’s business has meant that it has been little affected by the pandemic. Cybersecurity continues to be a major consideration in all aspects of the business. Noxopharm also remains a major shareholder in US biotechnology company Nyrada Inc. (ASX:NYR) which is active in the areas of drug development for cardiovascular and neurological diseases. “The ‘4 Pillars Oncology’ clinical development strategy for Veyonda® is based on the concept of using the broad anti-cancer properties of idronoxil to allow Veyonda® to be used to enhance the effectiveness of other commonly-used anti-cancer treatments”. 5 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 SENIOR EXECUTIVE TEAM Dr Graham Kelly Dr Gisela Mautner Dr Jeanette Bell Chief Executive Officer and Managing Director Chief Medical Officer Chief Operating Officer Mr Shawn Vanboheemen Dr Olivier Laczka Dr John Wilkinson Chief Financial Officer Group Chief Scientific Officer Chief Technical Officer R&D HIGHLIGHTS LuPIN DARRT IONIC CEP The LuPIN trial at St Vincent’s Hospital in Sydney in late-stage prostate cancer showed Veyonda plus 177Lutetium-PSMA-617 (LuPSMA) survival data providing a median overall survival (mOS) of 19.7 months at a major oncology conference, ASCOGU. This was compared to other trials using LuPSMA alone with a mOS of 11.6 months (WARMTH trial) and 15.3 months (Novartis’ VISION trial). DARRT-2 trial received Investigational New Drug (IND) approval by the FDA in late June. The multi- national trial Phase 2 study is being overseen by international contract research organisation (CRO) Parexel. IONIC-1 clinical trial planning, combining Veyonda® with checkpoint inhibitor Bristol Myers Squibb drug, Opdivo® (nivolumab). The study is going to be conducted at multiple Australian sites under the supervision of eminent oncologist, Professor Paul de Souza. CEP-2 trial in soft-tissue sarcoma – planning well underway built on CEP-1 Phase 1a/1b trial findings of positive anti-cancer outcomes in patients with advanced breast, ovarian, lung and prostate cancer which were published in the April edition of the peer-reviewed journal Current Therapeutic Research. 6 INTELLECTUAL PROPERTY (IP) PORTFOLIO Noxopharm continues to strive to build a strong IP portfolio around its increasing library of clinical and pre-clinical drug assets. NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 New patent applications filed Foundation composition of matter patent family entitled “Improvements in cancer treatment”. New method of treating oncology patent application entitled “Immuno-oncology therapy”. New method of treatment patent application entitled “Methods for the treatment of inflammation associated with infection” Allowances Method of treating cancer using a defined dosing regimen entitled “Isoflavonoid composition with improved pharmacokinetics”. Method of treating cancer using a combination treatment entitled “Combination chemotherapy”. CORPORATE GOVERNANCE • • • • • • • • • • US continuation application filed 24 May 2021 (US 17/328041). Europe divisional application filed 26 May 2021 (EP 21176052.5). PCT application filed 20 July 2020 (PCT/AU2020/050730). US national phase application filed 19 May 2021. PCT application filed 30 March 2021 (PCT/AU2021/050282) US national phase application filed 19 May 2021 European application allowed (EP 17778482.4). European divisional application to be filed in FY22. Japanese application allowed (JP 2018-555499). Japanese divisional application to be filed in FY22. Noxopharm has adopted rigorous systems of control, review and accountability as the basis for the administration of corporate governance. The Board is committed to administering its corporate governance policies and procedures with openness and integrity. Cybersecurity and Sustainability (ESG) will continue to be closely monitored and to grow in line with the growth of the Company. FINANCIAL UPDATE Noxopharm remains well-funded following a A$23 million capital raise in December 2020 led by Canaccord Genuity Australia, and the exercise of $6M in options in January 2021. • • • As at 30 June 2021, Noxopharm held A$26.8m in cash A Federal Government tax rebate of A$4.59 million was received in January 2021, with receipt of a formal notification of approval of the Advanced Overseas finding from the Department of Industry, Science, Energy and Resources. The approval is that the Company’s projected R&D expenditure over the 2020-2022 period both in Australia and overseas will be eligible for the AusIndustry R&D tax incentive program, returning 43% of approved funding back to the Company. The short-term loan convertible note was settled through the issue of shares on 31 May 2021. The Company remains in a strong financial position, with expenditure in line with forecasts. In light of a rapidly expanding clinical program, the Company remains confident of meeting anticipated business expenses over the 2021-22 FY. Graham Kelly, CEO 7 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 8 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 DIRECTORS’ REPORT The directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as the 'consolidated entity') consisting of Noxopharm Limited (referred to hereafter as the 'company' or 'parent entity') and the entities it controlled at the end of, or during, the year ended 30 June 2021. DIRECTORS The following persons were directors of Noxopharm Limited during the whole of the financial year and up to the date of this report, unless otherwise stated: Mr. Fred Bart Dr. Graham Kelly Mr. Peter Marks Mr. Boris Patkin Non-Executive Chairman Chief Executive Officer and Managing Director Non Executive Director and Deputy Chairman ‐ Non-Executive Director and, Dr. Ian Dixon, Non Executive Director (resigned 31 August 2020) PRINCIPAL ACTIVITIES ‐ The consolidated entity's principal activity in the course of the current financial year continued to be drug development, with the primary focus being the clinical development of Veyonda® (idronoxil) as an adjuvant therapy in chemotherapy and radiotherapy in the treatment of late-stage cancers. There were no significant changes in the nature of the Company’s principal activity during the financial year. DIVIDENDS There were no dividends paid, recommended or declared during the current or previous financial year. REVIEW OF OPERATIONS The loss for the consolidated entity after providing for income tax and non-controlling interest amounted to $9,346,749 (30 June 2020: $272,093). During the financial year, the consolidated entity has: • • • • Continued to drive the ‘4-Pillars Oncology’ strategy, investigating the ability of Veyonda® to enhance the effects of oncology treatments in conjunction with radiotherapy, radioligand therapy, checkpoint inhibitor therapy and chemotherapy; LuPIN study (Veyonda® + LuPSMA) survival data (mOS) of 19.7 months presented at major oncology conference. Compares favourably with other studies using LuPSMA alone with mOS of 11.6 months (WARMTH) and 15.3 months (VISION study); DARRT-2 study received Investigational New Drug (IND) approval by the FDA. The multi-national trial Phase 2 study is being overseen by the international contract research organisation (CRO) Parexel; IONIC-1 clinical trial planning, combining Veyonda® with checkpoint inhibitor Bristol Myers Squibb drug, Opdivo® (nivolumab). The study is going to be conducted at multiple Australian sites; 9 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 • • • • CEP-1 Phase 1a/1b trial findings of positive anti-cancer outcomes in patients with advanced breast, ovarian, lung and prostate cancer were published in the peer-reviewed journal Current Therapeutic Research; CRO Paraexel is completing site selection in the US for the CEP-2 study, building on the encouraging outcomes of CEP-1; Recruitment into the NOXCOVID-1 study is complete, Veyonda® was determined to be well tolerated in the dose escalation- phase of the study in patients with compromised lung function. Continued to develop a pipeline of drug candidates as part of a strategy of expanding the profile of the Company in the global pharmaceutical industry. SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS There were no significant changes in the state of affairs of the consolidated entity during the financial year. LIKELY DEVELOPMENTS AND EXPECTED RESULTS OF OPERATIONS Information on likely developments in the operations of the consolidated entity and the expected results of operations have not been included in this report because the directors believe it would be likely to result in unreasonable prejudice to the consolidated entity. MATTERS SUBSEQUENT TO THE END OF THE FINANCIAL YEAR No matter or circumstance has arisen since 30 June 2021 that has significantly affected, or may significantly affect the consolidated entity's operations, the results of those operations, or the consolidated entity's state of affairs in future financial years. ENVIRONMENTAL REGULATION The consolidated entity is not subject to any significant environmental regulation under Australian Commonwealth or State law. 10 INFORMATION ON DIRECTORS NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 Name: Title: Experience and expertise: Mr. Fred Bart Non-Executive Chairman In 1985, Mr Bart was appointed the Managing Director of Textile Industries Australia. The Group employed over 1,200 people and distributed product to many countries worldwide. The Company manufactured and distributed the majority of bed linen in Australia under brands like Sheridan and ACTIL. The Company was sold in 1987. In 1989, Mr Bart established and chairs a number of private companies under the umbrella of the Bart Group which covered hotels, retail, commercial and residential land development and technologies which still continue to operate. The Group today employs in excess of 1,000 people and is active in many local and overseas markets. In 2001, Mr Bart became Chairman of Electro Optic Systems Holdings Limited (ASX: EOS). Since that time it has grown to be one of Australia’s premier defence companies with activities in many countries worldwide employing over 400 people and is currently included in the S&P/ASX 300. In September 2000, Mr Bart became a director and Chairman of Audio Pixels Holdings Limited (ASX: AKP). Audio Pixels is developing the first digital speaker in the world and currently has a market capitalisation of over $600m. In 2013, Mr Bart became Chairman and majority shareholder of Immunovative Therapies Limited, a private Israeli company involved in the manufacture of vaccines for the treatment of certain forms of cancer. The Company has undertaken trials in both collateral and liver cancers. In March 2018, Mr Bart joined the Board of Weebit Nano Limited (ASX: WBT). Weebit is a developer of memory technology (1,000 X faster, 1,000 X more energy efficient and 100X higher endurance) than existing flash memory technologies. Other current directorships: Fred Bart is Chairman of ASX listed companies, Electro Optic Systems Holdings Limited and Audio Pixels Holdings Limited and is a director of Weebit Nano Limited. Mr Bart is also a director of Immunovative Therapies Limited, an Israeli company involved in in the manufacture of cancer vaccines for the treatment of most forms of cancer. Former directorships (last 3 years): N/A Interests in shares: 5,618,651 Interests in options: 3,846,154 11 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 Name: Title: Experience and expertise: Dr. Graham Kelly Chief Executive Officer and Managing Director ‐ formed Department of Transplant Surgery in the Faculty of Graham graduated with degrees in Science (1968) and Veterinary Science (1969) from The University of Sydney. After graduation he joined the newly Medicine at The University of Sydney, gaining a Doctor of Philosophy in 1972. The subject of his PhD thesis was the manufacture and use of a novel drug for the treatment of tissue rejection in kidney transplant recipients, with that drug subsequently being commercialised and used globally in kidney transplantation. Graham was appointed Senior Research Fellow in Experimental Surgery at The University of Sydney, contributing through research in the areas of organ recovery for transplantation and liver transplant surgery. The increased susceptibility of organ transplant recipients to malignant cancer eventually led Graham to focus on the causes of that phenomenon, and in turn, to the broader issue of the link between diet and the incidences of certain cancers. The latter area of research led to a research interest in dietary isoflavones and their role in human health. Graham developed a theory that dietary isoflavones were metabolised within the body into novel chemicals that possessed important hormone like functions, and as such made important contributions to human health. That theory provided the basis for Graham leaving academia and founding the company, Norvet Ltd, which listed on the ASX in 1994. That company subsequently changed its name to Novogen Ltd and listed in the US on NASDAQ (1998). Graham was variously CEO, Executive Chairman and an Executive Director of Novogen, 1994 2006. He also was Executive Chairman of Marshall Edwards Inc (MEI) which listed on London’s AIM exchange (2001) and NASDAQ (2003). MEI subsequently became MEI Pharma Inc. Graham resigned from his executive and Board positions at Novogen and MEI in 2006. ‐ ‐ 2012, Graham addressed the matter of the transport of isoflavones in the blood of humans, In early conducting formulation studies in a private capacity that led shortly thereafter to the concept behind NOX66. After leaving Novogen in 2015, Graham established private biotechnology company Noxopharm Limited in order to commercialise NOX66. Noxopharm became a public company in August 2016. ‐ Graham was also the founder of a fourth biotechnology company, Nyrada Inc. in September 2017. Nyrada (ASX:NYR) became a public company in January 2020. Nyrada is a drug development company with a focus on cardiovascular and traumatic brain injury treatments. Noxopharm is currently the major shareholder. Other current directorships: N/A Former directorships (last 3 years): Nyrada Inc. (resigned 8 September 2020) Interests in shares: 36,152,294 Interests in options: 1,820,513 12 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 Name: Title: Experience and expertise: Mr. Peter Marks Non Executive Director and Deputy Chairman ‐ Peter has over 35 years’ experience in corporate advisory, and investment banking. Over the course of his long career, he has specialised in capital raising IPOs, cross border, M&A transactions, corporate underwriting and venture capital transactions for companies in Australia, the US and Israel. He has been involved in a broad range of transactions with a special focus in the life sciences, biotechnology, medical technology and high tech segments. Peter has served as both an Executive and Non-Executive Director of a number of different entities which have been listed on the ASX, Nasdaq and AIM markets. Peter holds a Bachelor of Economics, Bachelor of Laws and a Graduate Diploma in Commercial Law from Monash University, Australia. He also holds an MBA from the University of Edinburgh, Scotland. Other current directorships: Alterity Therapeutics Limited (ASX: ATH) - since 29 July 2005 (formerly known as Prana Biotechnology Limited), Elsight Limited (ASX: ELS) since 9 January 2020 and Nyrada Inc. (ASX:NYR) since 16 January 2020. Former directorships (last 3 years): Fluence Corporation Limited (ASX:FLC) - resigned 31 March 2020 Interests in shares: 900,000 Interests in options: 66,667 Name: Title: Mr. Boris Patkin Non-Executive Director Experience and expertise: Boris brings comprehensive market knowledge, thorough research and years of experience in investment markets and Business Consulting. Boris’s experience lends itself to Financial and Investment advising but also as a business consultant to further enhance business opportunities in Medical technology and in sourcing other opportunities to enhance investments. Boris has worked extensively with Israeli companies to explore various opportunities in the Medical and disruptive technology space. Boris has developed an in-depth understanding of industry trends and gained valuable insight into domestic and international markets. Boris has specialised in reconstruction of Companies, Investments and International trade. He has extensive experience in developing and adding value to public listed companies, especially in the Medical, Resources and Retirement space. Boris has completed a Bachelor of Science (Industrial Chemistry). Currently a member of TASSA, MeSAFAA and an Authorised Representative of Morgans Financial Ltd. Other current directorships: Non-Executive Chairman of Ausmon Resources Ltd - since 2014 Former directorships (last 3 years): N/A Interests in shares: 630,000 Interests in options: 310,000 'Other current directorships' quoted above are current directorships for listed entities only and excludes directorships of all other types of entities, unless otherwise stated. 'Former directorships (last 3 years)' quoted above are directorships held in the last 3 years for listed entities only and exclude directorships of all other types of entities, unless otherwise stated. 13 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 COMPANY SECRETARY MR. DAVID FRANKS David Franks (BEc, CA, FFin, FGIA, JP) has held the position of Company Secretary since 16 January 2017. David is a Director and Principal of the Automic Group. He is a Chartered Accountant, Fellow of the Financial Services Institute of Australasia, Fellow of the Governance Institute of Australia, Justice of Peace and Registered Tax Agent, with over 20 years’ experience as a Director and Company Secretary of numerous publicly listed entities. He holds a Bachelor of Economics (Finance and Accounting) from Macquarie University. David is an experienced Company Secretary and Director of listed and unlisted public companies and is currently Company Secretary for the following ASX listed public companies: Aumake Limited, COG Financial Services Limited, Cogstate Limited, JCurve Solutions Limited, IXUP Limited, Noxopharm Limited, Nyrada Inc, White Energy Company Limited and ZIP Co Limited. MEETINGS OF DIRECTORS The number of meetings of the company's Board of Directors ('the Board') and of each Board committee held during the year ended 30 June 2021, and the number of meetings attended by each director were: Full Board Audit and Risk Committee Remuneration Committee Attended Held Attended Held Attended Held Dr. Graham Kelly Mr. Peter Marks Dr. Ian Dixon Mr. Boris Patkin Mr. Fred Bart 7 7 1 7 7 7 7 1 7 7 2 2 - 1 - 2 2 - 1 - 1 1 1 - - 1 1 1 - - Held: represents the number of meetings held during the time the director held office or was a member of the relevant committee. REMUNERATION REPORT (AUDITED) The Remuneration report, which has been audited, outlines the key management personnel remuneration arrangements for the consolidated entity, in accordance with the requirements of the Corporations Act 2001 and its Regulations. Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, including all directors. The remuneration report is set out under the following main headings: • • • • • • Principles used to determine the nature and amount of remuneration Details of remuneration Service agreements Share-based compensation Additional information Additional disclosures relating to key management personnel PRINCIPLES USED TO DETERMINE THE NATURE AND AMOUNT OF REMUNERATION Remuneration governance The objective of the remuneration committee (constituting the full Board) is to ensure that pay and rewards are competitive and appropriate for the results delivered. The remuneration committee charter adopted by the Board aims to align rewards with achievement of strategic objectives and the creation of value for shareholders. The remuneration framework applied provides a mix of fixed and variable pay and a blend of short and long-term incentives as appropriate. Issues of remuneration are considered annually or otherwise as required. Non-Executive Directors Fees and payments to Non Company's policy is to remunerate Non responsibilities. Fees for Non interests with shareholders’ interests, Directors are encouraged to hold shares in the Company. Executive Directors reflect the demands which are made on, and the responsibilities of, the Directors. The Executive Directors at market rates (for comparable companies) for time commitment and Executive Directors are not linked to the performance of the Company, however to align Directors’ ‐ ‐ ‐ 14 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 Executive Directors' fees and payments are reviewed annually by the Board of Directors. The Board of Directors considers advice Executive Directors of comparable Non from external sources (excluding remuneration consultants) as well as the fees paid to Non companies when undertaking the annual review process. Each director receives a fee for being a director of the company. ‐ ‐ The Chairman's fees are determined independently to the fees of other Non external market. The Chairman is not present at any discussions relating to determination of his own remuneration. Executive Directors based on comparative roles in the ‐ Retirement benefits and allowances No retirement benefits are payable other than statutory superannuation, if applicable to the Directors of the Company. Other benefits No motor vehicle, health insurance or other similar allowances are available to Directors (other than through salary sacrifice arrangements). Executive remuneration ‐ Executive pay and reward consists of base pay, short term performance incentives and other remuneration such as superannuation. Superannuation contributions are paid into the executive’s nominated superannuation fund. term performance incentives, long ‐ ‐ Base Pay Executives are offered a competitive level of base pay which comprises the fixed (unrisked) component of their pay and rewards. Base pay for senior executives is reviewed annually to ensure market competitiveness. There are no guaranteed base pay increases included in any senior executives’ contracts. Base pay was increased during the year. Short term and long term incentives ‐ The Company currently operates an Executive Share Option Plan ("ESOP") which has been approved by shareholders in the 2016 Annual General Meeting. ‐ Performance based Remuneration The purpose of a performance bonus is to reward individual performance in line with company objectives. Consequently, performance based remuneration is paid to an individual where the individual’s performance clearly contributes to a successful outcome for the consolidated entity. This is regularly measured in respect of performance against key performance indicators (KPI’s). The Company uses a variety of KPIs to determine achievement, depending on the role of the executive being assessed. These include: • • • Successful contract negotiations; Company share price consistently reaching a targeted rate on the ASX or applicable market over a period of time; Company undertaking clinical trials in their primary drug Veyonda® within specified time frame. Securities trading Policy The trading of Company's securities by employees and Directors is subject to, and conditional upon, the Securities Trading Policy which is available on the Company's website (www.noxopharm.com). If remuneration consultants are to be engaged to provide remuneration recommendations as defined under section 9B of the Corporations Act 2001, then they are engaged by, and report directly to, the remuneration committee. No remuneration consultants were engaged to provide remuneration services during the financial year. Remuneration Policy vs Financial Performance The Company’s policy is to remunerate based on industry practice and benchmark industry salaries rather than performance as this takes into account the risk and liabilities assumed by directors and executives as a result of their involvement in an R&D Biotech company. Directors and executives are fairly compensated for the extensive work they undertake. Voting and comments made at the company's 2020 Annual General Meeting ('AGM') At the 2020 AGM, more than 75% of the votes received supported the adoption of the remuneration report for the year ended 30 June 2020. The company did not receive any specific feedback at the AGM regarding its remuneration practices. 15 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 DETAILS OF REMUNERATION Amounts of remuneration Details of the remuneration of key management personnel of the consolidated entity are set out in the following tables. The key management personnel of the consolidated entity consisted of the following directors, executives and company secretary of Noxopharm Limited: • Dr. Graham Kelly - Chief Executive Officer and Managing Director • Mr. Fred Bart - Non Executive Chairman • Mr. Peter Marks - Non Executive Director and Deputy Chairman • Mr. Boris Patkin - Non Executive Director • Dr. Ian Dixon - Non Executive Director (resigned 31 August 2020) • Mr. David Franks - Company Secretary Short-term benefits Post- employment benefits Long- term benefits Share- based payments Cash salary and fees Cash bonus Non- monetary * Super- annuation Long service leave Equity- settled 2021 $ $ $ $ $ $ Total $ Directors: Dr. Graham Kelly Mr. Fred Bart Mr. Peter Marks Mr. Boris Patkin Dr. Ian Dixon (resigned 31 August 2020) Other Key Management Personnel: 300,000 41,095 60,000 45,000 10,274 Mr. David Franks - - - - - - - 23,126 30,000 341 - 353,467 - - - - - 3,905 - - 976 - - - - 1,394,300 1,439,300 - 60,000 8,029 53,029 - 11,250 - - 16,490 16,490 *provision for annual leave 456,369 - 23,126 34,881 341 1,418,819 1,933,536 Mr. David Franks, company secretary is also an associate of Automic Group who provides registry, accounting and company secretary services to the Company. The contracts with Automic Group Associates are based on normal commercial terms. Payments made to Automic Group during the year are disclosed in the related party transactions note of the financial statements. 16 2020 Directors: Dr. Graham Kelly Mr. Peter Marks Dr. Ian Dixon Mr. John Moore (resigned 16 July 2019) Mr. Boris Patkin Mr. Fred Bart Dr. Beata Niechoda (resigned 16 October 2019) Other Key Management Personnel: Mr. David Franks Dr. Greg Van Wyk (resigned 31 October 2019) *provision for annual leave NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 Short-term benefits Post- employment benefits Long- term benefits Share- based payments Cash salary and fees Cash bonus Non- monetary * Super- annuation Long service leave Equity- settled $ $ $ $ $ $ 315,000 80,000 52,511 7,500 11,250 5,967 29,625 - 186,042 - - - - - - - - - 7,725 31,500 17,621 - - - - - - - - - 4,989 - - 567 - - 10,556 - - - - - - - - Total $ 371,846 80,000 57,500 7,500 11,250 6,534 29,625 - - - - - - - 8,475 8,475 - 137,768 629,065 - 7,725 47,612 17,621 8,475 710,498 17 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 The proportion of remuneration linked to performance and the fixed proportion are as follows: Name Directors: Dr. Graham Kelly Mr. Fred Bart Mr. Peter Marks Mr. Boris Patkin Dr. Ian Dixon Mr. John Moore Dr. Beata Niechoda Other Key Management Personnel: Mr. David Franks Dr. Greg van Wyk SERVICE AGREEMENTS Fixed remuneration At risk - STI At risk - LTI 2021 2020 2021 2020 2021 2020 100% 3% 100% 85% 100% - - - - 100% 100% 100% 100% 100% 100% 100% - 100% - - - - - - - - - - - - - - - - - - - 97% - 15% - - - - - - - - - - 100% 100% - - Remuneration and other terms of employment for key management personnel are formalised in service agreements. Details of these agreements are as follows: Name: Title: Dr. Graham Kelly Chief Executive Officer and Managing Director Agreement commenced: 9 August, 2016 Term of agreement: Open Details: Annual salary of $300,000 plus superannuation of 10%. Notice period of 90 days by Executive or the Company; 12 months by Company without cause. Key management personnel have no entitlement to termination payments in the event of removal for misconduct. 18 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 SHARE-BASED COMPENSATION Issue of shares There were no shares issued to directors and other key management personnel as part of compensation during the year ended 30 June 2021. Options The terms and conditions of each grant of options over ordinary shares affecting remuneration of directors and other key management personnel in this financial year or future reporting years are as follows: Grant date Vesting date and exercisable date Expiry date Exercise price Fair value per option at grant date 8 December 2017 1 December 2018 30 November 2021 8 December 2017 1 December 2019 30 November 2021 8 December 2017 1 December 2020 30 November 2021 10 December 2018 21 November 2019 21 November 2022 10 December 2018 21 November 2020 21 November 2022 10 December 2018 21 November 2021 21 November 2022 16 December 2019 16 December 2020 16 December 2023 6 November 2020 6 November 2021 6 November 2024 15 December 2020 15 December 2020 15 December 2022 15 December 2020 15 December 2020 15 December 2022 15 December 2020 15 December 2020 15 December 2022 31 May 2021 15 December 2021 15 December 2024 31 May 2021 15 December 2022 15 December 2024 $1.0800 $1.0800 $1.0800 $0.6200 $0.6200 $0.6200 $0.3200 $0.5500 $0.3150 $0.3150 $0.3150 $0.6810 $0.6810 $0.617 $0.617 $0.617 $0.288 $0.288 $0.288 $0.169 $0.329 $0.467 $0.464 $0.464 $0.314 $0.313 Options granted carry no dividend or voting rights. The number of options over ordinary shares granted to and vested by directors and other key management personnel as part of compensation during the year ended 30 June 2021 are set out below: Number of options granted during the year Number of options granted during the year Number of options vested during the year Number of options vested during the year 2021 2020 2021 2020 Name Mr. Fred Bart 3,000,000 Mr. David Franks Dr. Greg van Wyk 50,000 - ADDITIONAL INFORMATION - 50,000 - 3,000,000 90,046 - - 40,046 5,208 The factors that are considered to affect total shareholders return ('TSR') are summarised below: Share price at financial year end (cents) Share price HIGH for the financial year ended 30 June (cents) Share price LOW for the financial year ended 30 June (cents) 2020 16.50 45.92 8.39 2019 47.50 72.00 35.50 2018 61.00 158.00 29.00 2017 36.50 67.50 13.50 2021 64.50 95.00 18.50 19 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 ADDITIONAL DISCLOSURES RELATING TO KEY MANAGEMENT PERSONNEL Shareholding The number of shares in the company held during the financial year by each director and other members of key management personnel of the consolidated entity, including their personally related parties, is set out below: Balance at the start of the year Received as part of remuneration Additions Disposals/ other Balance at the end of the year Ordinary shares Dr. Graham Kelly1 36,992,294 Mr. Peter Marks Dr. Ian Dixon Mr. Boris Patkin Mr. Fred Bart2 700,000 1,766,246 630,000 5,594,780 45,683,320 - - - - - - 8,000,000 (8,840,000) 36,152,294 200,000 - - - - - 900,000 1,766,246 630,000 3,080,189 (3,056,318) 5,618,651 11,280,189 (11,896,318) 45,067,191 1 Excludes securities held in the name of spouse, Mrs. Prue Kelly. 2 3,080,189 shares were issued to an associated entity of Fred Bart, Bart Superannuation Pty Limited atf 4f Investments Super Fund as consideration for the settlement of the short term loan convertible note on maturity. Option holding - Company The number of options over ordinary shares in the company held during the financial year by each director and other members of key management personnel of the consolidated entity, including their personally related parties, is set out below: Balance at the start of the year Granted Exercised Expired/ forfeited/ other Balance at the end of the year Options over ordinary shares Dr. Graham Kelly1 13,895,513 Mr. Peter Marks Dr. Ian Dixon Mr. Boris Patkin Mr. Fred Bart Mr. David Franks 766,667 1,200,000 60,000 1,864,927 170,139 - - - 500,000 3,000,000 50,000 (8,000,000) (4,075,000) 1,820,513 (200,000) - - - - (500,000) (500,000) (250,000) 66,667 700,000 310,000 (1,018,773) 3,846,154 - 220,139 1 Excludes options held in in the name of the spouse, Mrs. Prue Kelly. 17,957,246 3,550,000 (8,200,000) (6,343,773) 6,963,473 Other transactions with key management personnel and their related parties Company secretarial and bookkeeping services - provided by Automic Group, an entity associated with Mr. David Franks, on Company secretarial and share registry services - provided by Automic Group, an entity associated with Mr. David Franks, on commercial terms and conditions. Total fees paid (excluding GST) to Automic Group for the year ended 30 June 2021 was $308,236 (2020: $312,569). Prue Kelly, spouse of Graham Kelly (Chief Executive Officer and Managing Director) is employed as the Company's full time Investor Relation Manager/Executive Assistant on the Company's employment terms and conditions. Total salary inclusive of superannuation paid to Prue Kelly for the year ended 30 June 2021 was $131,856 (2020: $134,890). The total value of unlisted options granted to Prue Kelly for the year ended 30 June 2021 was $20,613 (2020: $10,594). This concludes the remuneration report, which has been audited. 20 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 SHARES UNDER OPTION Unissued ordinary shares of Noxopharm Limited under option at the date of this report are as follows: Grant date Expiry date Exercise price Number under option 8 December 2017 2 30 November 2021 10 December 2018 2 21 November 2022 23 July 2019 1,4 23 July 2023 23 December 2019 2 16 December 2023 18 June 2020 3 18 June 2023 14 August 2020 3 14 August 2023 6 November 2020 2 6 November 2024 15 December 2020 15 December 2024 31 May 2021 15 December 2024 $1.0800 $0.6200 $0.5605 $0.3200 $0.3000 $0.3000 $0.5500 $0.3150 $0.6810 386,343 866,042 4,722,222 930,128 20,037,101 25,304,704 1,050,000 3,000,000 250,000 56,546,540 1 In accordance with Listing Rule 3.11.2, and further to the terms of these options issued and Listing Rule 6.22.2, the exercise price of the options has been amended as a result of the 13 May 2020 pro-rata Entitlements Offer to shareholders. 2 Issued under the Noxopharm employee share plan. 3 Issued for participating in capital raises. 4 Issued in relation to the convertible notes issued July 2019 and December 2019. No person entitled to exercise the options had or has any right by virtue of the option to participate in any share issue of the company or of any other body corporate. SHARES ISSUED ON THE EXERCISE OF OPTIONS The following ordinary shares of Noxopharm Limited were issued during the year ended 30 June 2021 and up to the date of this report on the exercise of options granted: Date options granted Exercise price Number of shares issued 31 January 2016 3 December 2019 20 June 2020 14 August 2020 20,243,216 2,666,666 267,691 115 23,177,688 $0.3000 $0.3100 $0.3054 $0.3000 21 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 INDEMNITY AND INSURANCE OF OFFICERS The company has indemnified the directors and executives of the company for costs incurred, in their capacity as a director or executive, for which they may be held personally liable, except where there is a lack of good faith. During the financial year, the company paid a premium in respect of a contract to insure the directors and executives of the company against a liability to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits disclosure of the nature of the liability and the amount of the premium. INDEMNITY AND INSURANCE OF AUDITOR The company has not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the company or any related entity against a liability incurred by the auditor. During the financial year, the company has not paid a premium in respect of a contract to insure the auditor of the company or any related entity. PROCEEDINGS ON BEHALF OF THE COMPANY No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf of the company, or to intervene in any proceedings to which the company is a party for the purpose of taking responsibility on behalf of the company for all or part of those proceedings. NON-AUDIT SERVICES There were no non-audit services provided during the financial year by the auditor. OFFICERS OF THE COMPANY WHO ARE FORMER PARTNERS OF WILLIAM BUCK AUDIT (VIC) PTY LTD There are no officers of the company who are former partners of William Buck Audit (Vic) Pty Ltd. AUDITOR'S INDEPENDENCE DECLARATION A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out immediately after this directors' report. AUDITOR William Buck Audit (Vic) Pty Ltd continues in office in accordance with section 327 of the Corporations Act 2001. This report is made in accordance with a resolution of directors, pursuant to section 298(2)(a) of the Corporations Act 2001. On behalf of the directors ___________________________ Dr Graham Kelly Director 26 August 2021 22 AUDITOR’S INDEPENDENCE DECLARATION UNDER SECTION 307C OF THE CORPORATIONS ACT 2001 TO THE DIRECTORS OF NOXOPHARM LIMITED I declare that, to the best of my knowledge and belief, during the year ended 30 June 2021 there have been: — no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and — no contraventions of any applicable code of professional conduct in relation to the audit. William Buck Audit (Vic) Pty Ltd ABN 59 116 151 136 N. S. Benbow Director Melbourne, 26 August 2021 14 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 ANNUAL FINANCIAL REPORT - 30 JUNE 2021 CONTENTS Statement of profit or loss and other comprehensive income Statement of financial position Statement of changes in equity Statement of cash flows Notes to the financial statements Directors' declaration Independent auditor's report to the members of Noxopharm Limited Shareholder information GENERAL INFORMATION 25 27 28 29 30 54 55 59 The financial statements cover Noxopharm Limited as a consolidated entity consisting of Noxopharm Limited and the entities it controlled at the end of, or during, the year. The financial statements are presented in Australian dollars, which is Noxopharm Limited's functional and presentation currency. Noxopharm Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business is: Noxopharm Limited Level 20, Tower A, The Zenith 821 Pacific Highway CHATSWOOD NSW 2067 A description of the nature of the consolidated entity's operations and its principal activities are included in the directors' report, which is not part of the financial statements. The financial statements were authorised for issue, in accordance with a resolution of directors, on 26 August 2021. The directors have the power to amend and reissue the financial statements. CORPORATE GOVERNANCE STATEMENT The Corporate Governance Statement is available on the Company’s website at http://www.noxopharm.com 24 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2021 Notes 4 12 5 5 5 6 Consolidated 2021 $ 2020 $ 5,797,723 8,774,212 8,343,562 - - 11,585,717 (1,722,626) (12,560,987) (261,723) (12,284) (5,656,445) (2,186,221) (1,040,874) (477,524) (3,045,016) (7,672,034) (241,445) - (5,407,893) (3,466,847) (1,095,617) - (9,346,749) (999,573) - - (9,346,749) (999,573) - - (9,346,749) (999,573) - (9,346,749) (9,346,749) (727,480) (272,093) (999,573) (9,346,749) (10,402,633) - (9,346,749) (9,346,749) 9,403,060 (999,573) (999,573) Revenue Other income Net gain on reclassification of investment to fair value accounting Net gain on disposal of investments Expenses Corporate administration expenses Research and development expenses Depreciation and amortisation expenses Finance fee expenses Consulting, employee & director expenses Finance costs Share of loss of Associate (to 29 June 2021) Fair value movement in derivative liability Loss before income tax expense Income tax expense Loss after income tax expense for the year Other comprehensive income for the year, net of tax Total comprehensive income for the year Loss for the year is attributable to: Non-controlling interest Owners of Noxopharm Limited Total comprehensive income for the year is attributable to: Continuing operations Discontinued operations Owners of Noxopharm Limited 25 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 Earnings per share for profit/(loss) from continued operations attributable to the owners of Noxopharm Limited Basic earnings per share Diluted earnings per share Earnings per share for profit/(loss) from discontinued operations attributable to the owners of Noxopharm Limited Basic earnings per share Diluted earnings per share Earnings per share for loss attributable to the owners of Noxopharm Limited Basic earnings per share Diluted earnings per share 29 29 29 29 29 29 Cents Cents (3.54) (3.54) - - (3.54) (3.54) (7.52) (7.52) 6.80 6.80 (0.20) (0.20) The above statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes 26 STATEMENT OF FINANCIAL POSITION NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 AS AT 30 JUNE 2021 Assets Current assets Cash and cash equivalents Trade and other receivables Other assets Total current assets Non-current assets Receivables Investments accounted for using the equity method Financial assets at fair value through profit and loss Plant and equipment Right-of-use assets Term deposit pledged for bank guarantee Total non-current assets Total assets Liabilities Current liabilities Trade and other payables Borrowings Employee entitlements Total current liabilities Non-current liabilities Borrowings Employee entitlements Total non-current liabilities Total liabilities Net assets Equity Issued capital Reserves Accumulated losses Total equity Consolidated Notes 2021 $ 2020 $ 7 8 9 10 11 12 13 14 15 16 17 26,795,785 5,799,224 379,027 7,100,202 4,646,649 582,542 32,974,036 12,329,393 - - 14,272,419 135,111 349,308 122,837 225,232 6,539,080 - 192,499 658,110 122,837 14,879,675 7,737,758 47,853,711 20,067,151 6,130,170 231,666 445,359 1,786,852 4,586,820 311,968 6,807,195 6,685,640 117,642 152,499 270,141 413,290 95,463 508,753 7,077,336 7,194,393 40,776,375 12,872,758 72,622,560 8,487,119 41,631,007 2,708,106 (40,333,304) (31,466,355) 40,776,375 12,872,758 The above statement of financial position should be read in conjunction with the accompanying notes 27 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2021 Consolidated Issued capital $ Reserves Accumulated losses Non- controlling interest Total equity $ $ $ $ Balance at 1 July 2019 28,700,897 4,455,342 (33,256,912) (1,349,794) (1,450,467) Loss after income tax expense for the year Other comprehensive income for the year, net of tax Total comprehensive income for the year Nyrada Warrants expense p/e 16 Jan 2020 Transactions with owners in their capacity as owners: - - - - - - - 259,614 Contributions of equity, net of transaction costs (note 16) 12,930,110 - Deconsolidation of Nyrada Inc. - derecognition of option reserve Deconsolidation of Nyrada Inc. - derecognition of Convertible note reserve Deconsolidation of Nyrada Inc. - derecognition of NCI Writeback of expired options held by Kazia Vesting of share-based payments - (1,017,506) (762,045) - - - - - (2,062,650) 2,062,650 1,835,351 - (272,093) (727,480) (999,573) - - - (272,093) (727,480) (999,573) - - - - 259,614 12,930,110 (1,017,506) (762,045) 2,077,274 2,077,274 - - - - 1,835,351 12,872,758 Balance at 30 June 2020 41,631,007 2,708,106 (31,466,355) Consolidated Issued capital $ Reserves Accumulated losses Non- controlling interest Total equity $ $ $ $ Balance at 1 July 2020 41,631,007 2,708,106 (31,466,355) (9,346,749) - (9,346,749) - - - - Loss after income tax expense for the year Other comprehensive income for the year, net of tax Total comprehensive income for the year Transactions with owners in their capacity as owners: - - - Contributions of equity, net of transaction costs 21,471,650 - - - - Issue of options to underwriter (5,111,573) 5,111,573 Issue of Director's options Exercise of options Expired options Conversion of collateral shares Vesting of share-based payments - 1,402,345 7,544,451 (594,803) 267,637 - - 339,698 - (479,800) 479,800 Conversion of short term loan convertible notes 6,819,388 - Balance at 30 June 2021 72,622,560 8,487,119 (40,333,304) The above statement of changes in equity should be read in conjunction with the accompanying notes 28 - - - - - - - - - - - - - 12,872,758 (9,346,749) - (9,346,749) 21,471,650 - 1,402,345 6,949,648 - 267,637 339,698 6,819,388 40,776,375 - - - - - - - - STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2021 Cash flows from operating activities Receipts from customers Payments to suppliers and employees Interest received Receipt from R&D tax rebate Interest and other finance costs paid NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 Consolidated Notes 2021 $ 2020 $ 16,000 - (13,623,156) (14,977,501) 122,464 4,642,251 7,288 3,832,255 (8,842,441) (11,137,958) (8,000) - Net cash used in operating activities 28 (8,850,441) (11,137,958) Cash flows from investing activities Payments for plant and equipment Proceeds from deconsolidation of Nyrada, net of cash balances Proceeds from short term loan Nyrada Inc. Net cash from investing activities - - 225,232 225,232 (3,000) 340,815 - 337,815 Cash flows from financing activities Proceeds from issue of shares Proceeds from convertible notes, net of costs Proceeds from borrowings Lease Payments - building Share issue transaction costs Repayment of borrowings - convertible note Net cash from financing activities Net increase in cash and cash equivalents Cash and cash equivalents at the beginning of the financial year Effects of exchange rate changes on cash and cash equivalents 16 30,097,660 11,006,286 - - (244,821) (1,528,350) 5,496,976 4,200,000 (271,142) (785,680) - (4,655,663) 28,324,489 14,990,777 19,699,280 7,100,202 (3,697) 4,190,634 2,909,568 - Cash and cash equivalents at the end of the financial year 7 26,795,785 7,100,202 The above statement of cash flows should be read in conjunction with the accompanying notes 29 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTES TO THE FINANCIAL STATEMENTS NOTE 1. SIGNIFICANT ACCOUNTING POLICIES This note provides a list of all significant accounting policies adopted in the preparation of these financial statements. These policies have been consistently applied in this reporting period, unless otherwise stated. The financial statements are for Noxopharm Limited ("the Company") and its subsidiaries ("the consolidated entity"). NEW OR AMENDED ACCOUNTING STANDARDS AND INTERPRETATIONS ADOPTED The consolidated entity has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting period. Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted. The adoption of these Accounting Standards and Interpretations did not have any significant impact on the financial performance or position of the consolidated entity. Accounting Standard The revised Conceptual Framework for Financial Reporting AASB 2018-6 Amendments to Australian Accounting Standards – the definition of a business AASB 2018-7 Amendments to Australian Accounting Standards – Definition of Material AASB 2020-6 Amendments to Australian Accounting Standards – Classification of liabilities as Current or Non-Current - Deferral of Effective Dare BASIS OF PREPARATION Mandatory date for annual reporting periods on or after Reporting period standard adopted by the consolidated entity 01/01/2020 01/07/2020 01/01/2020 01/07/2020 01/01/2020 01/07/2020 01/01/2022 01/07/2023 These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and interpretations issued by the Australian Accounting Standards Board and the Corporations Act 2001. Noxopharm Limited is a for profit entity for the purpose of preparing the financial statements. These financial statements also comply with International Financial Reporting Standards as issued by the International Accounting Standards Board ('IASB'). ‐ Historical cost convention These financial statements have been prepared under the historical cost convention, with the exception of the fair valuation of embedded derivatives on convertible notes and the fair valuation of the investment in Nyrada. Critical accounting estimates The preparation of the financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the consolidated entity's accounting policies. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that may have a financial impact on the entity and that are believed to be reasonable under the circumstances. The consolidated entity makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. PARENT ENTITY INFORMATION In accordance with the Corporations Act 2001, these financial statements present the results of the consolidated entity only. Supplementary information about the parent entity is disclosed in note 25. 30 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 1. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) PRINCIPLES OF CONSOLIDATION The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Noxopharm Limited ('company' or 'parent entity') as at 30 June 2021 and the results of all subsidiaries for the year then ended. Noxopharm Limited and its subsidiaries together are referred to in these financial statements as the 'consolidated entity'. Subsidiaries are all those entities over which the consolidated entity has control. The consolidated entity controls an entity when the consolidated entity is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the consolidated entity. They are de-consolidated from the date that control ceases. Intercompany transactions, balances and unrealised gains on transactions between entities in the consolidated entity are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the consolidated entity. The acquisition of subsidiaries is accounted for using the acquisition method of accounting. A change in ownership interest, without the loss of control, is accounted for as an equity transaction, where the difference between the consideration transferred and the book value of the share of the non-controlling interest acquired is recognised directly in equity attributable to the parent. Where the consolidated entity loses control over a subsidiary, it derecognises the assets including goodwill, liabilities and non- controlling interest in the subsidiary together with any cumulative translation differences recognised in equity. The consolidated entity recognises the fair value of the consideration received and the fair value of any investment retained together with any gain or loss in profit or loss. FOREIGN CURRENCY TRANSLATION The financial statements are presented in Australian dollars, which is Noxopharm Limited's functional and presentation currency. The entity's subsidiary, Noxopharm Asia Limited, uses Hong Kong dollars as its functional currency and all other subsidiaries use Australian dollars as their functional currency. Foreign currency transactions Foreign currency transactions are translated into Australian dollars 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 financial year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss. Foreign operations The assets and liabilities of foreign operations are translated into Australian dollars using the exchange rates at the reporting date. The revenues and expenses of foreign operations are translated into Australian dollars using the average exchange rates, which approximate the rates at the dates of the transactions, for the period. All resulting foreign exchange differences are recognised in other comprehensive income through the foreign currency reserve in equity. The foreign currency reserve is recognised in profit or loss when the foreign operation or net investment is disposed of. OTHER INCOME RECOGNITION Other income is recognised when it is probable that the economic benefit will flow to the consolidated entity and the revenue can be reliably measured. Other income is measured at the fair value of the consideration received or receivable. Interest Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the net carrying amount of the financial asset. Government research and development tax incentives Government grants, including research and development incentives are recognised at fair value when there is reasonable assurance that the grant will be received and all grant conditions will be met. Grants relating to research and development expenditure are recognised as income over the periods necessary to match the grant costs they are compensating. The incentive is recognised as income as it is not tied to offsetting assessable income in tax. 31 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 1. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) CURRENT AND NON-CURRENT CLASSIFICATION Assets and liabilities are presented in the statement of financial position based on current and non-current classification. An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the consolidated entity's normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months after the reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period. All other assets are classified as non-current. A liability is classified as current when: it is either expected to be settled in the consolidated entity's normal operating cycle; it is held primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities are classified as non-current. ASSOCIATES Associates are entities over which the consolidated entity has significant influence but not control or joint control. Investments in associates are accounted for using the equity method. Under the equity method, the share of the profits or losses of the associate is recognised in profit or loss and the share of the movements in equity is recognised in other comprehensive income. Investments in associates are carried in the statement of financial position at cost plus post-acquisition changes in the consolidated entity's share of net assets of the associate. Goodwill relating to the associate is included in the carrying amount of the investment and is neither amortised nor individually tested for impairment. Dividends received or receivable from associates reduce the carrying amount of the investment. When the consolidated entity's share of losses in an associate equals or exceeds its interest in the associate, including any unsecured long-term receivables, the consolidated entity does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associate. The consolidated entity discontinues the use of the equity method upon the loss of significant influence over the associate and recognises any retained investment at its fair value. Any difference between the associate's carrying amount, fair value of the retained investment and proceeds from disposal is recognised in profit or loss. LEASES A 'right-of-use' asset will be capitalised in the statement of financial position, measured at the present value of the unavoidable future lease payments to be made over the lease term. A liability corresponding to the capitalised lease will also be recognised, adjusted for lease prepayments, lease incentives received, initial direct costs incurred and an estimate of any future restoration, removal or dismantling costs. Straight-line operating lease expense recognition will be replaced with a depreciation charge for the leased asset (included in operating costs) and an interest expense on the recognised lease liability (included in finance costs). RESEARCH AND DEVELOPMENT COSTS Research costs are expensed as incurred. FINANCE COSTS Finance costs attributable to qualifying assets are capitalised as part of the asset. All other finance costs are expensed in the period in which they are incurred. GOODS AND SERVICES TAX ('GST') AND OTHER SIMILAR TAXES 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 components of cash flows arising from investing or financing activities, which are recoverable from, or payable to the taxation authority, are presented as operating cash flow. NEW ACCOUNTING STANDARDS AND INTERPRETATIONS NOT YET MANDATORY OR EARLY ADOPTED Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory, have not been early adopted by the consolidated entity for the annual reporting period ended 30 June 2021. The directors consider that the adoption of these new standards and interpretations will not materially impact these financial statements. 32 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 2. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions on historical experience and on other various factors, including expectations of future events, management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal the related actual results. The judgements, estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are discussed below. RESEARCH AND DEVELOPMENT REBATE With the successful track record of the consolidated entity in obtaining the Research and Development rebate form the ATO, the estimated 2021 rebate for $5.5m has been accrued into income for the year ended 30 June 2021 (2020: $4.5m). SHARE-BASED PAYMENT TRANSACTIONS The consolidated entity measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined by using either the Binomial or Black-Scholes model taking into account the terms and conditions upon which the instruments were granted. The accounting estimates and assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts of assets and liabilities within the next annual reporting period but may impact profit or loss and equity. NON-RECOGNITION OF CARRIED FORWARD TAX LOSSES The balance of future income tax benefit arising from timing differences and carried-forward losses have not been recognised as an asset because recovery is not regarded as probable. The cumulative future income tax benefit which has not been recognised as an asset will only be obtained if: i) ii) iii) The Group derives future assessable income of a nature and amount sufficient to enable the benefit to be realised, The Group continues to comply with the conditions for the deductibility imposed by law, and No changes in tax legislation adversely affecting the Group realising the benefit. FAIR VALUE MEASUREMENT HIERARCHY The consolidated entity is required to classify all assets and liabilities, measured at fair value, using a three level hierarchy, based on the lowest level of input that is significant to the entire fair value measurement, being: Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date; Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; and Level 3: Unobservable inputs for the asset or liability. Considerable judgement is required to determine what is significant to fair value and therefore which category the asset or liability is placed in can be subjective. The fair value of assets and liabilities classified as level 3 is determined by the use of valuation models. These include discounted cash flow analysis or the use of observable inputs that require significant adjustments based on unobservable inputs. The consolidated entity's finance team performs valuations of financial items for financial reporting purposes, including Level 3 fair values, in consultation with third party valuation specialists for complex valuations. Valuation techniques are selected based on the characteristics of each instrument, with the overall objective of maximising the use of market-based information. The valuation techniques used for instruments categorised in levels 1 and 3 are described below: 33 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 2. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS (CONTINUED) VALUATION OF INVESTMENT IN NYRADA INC. On 29 June 2021 Nyrada Inc. completed a capital raise diluting the ownership percentage of the consolidated entity to under 20% on an in the money, diluted basis, As a result the consolidated entity lost significant influence over Nyrada, resulting in the investment being reclassified from the equity method to fair value through profit and loss method. The resulting fair value calculation of the investment resulted in a gain of $8,774,212. Nyrada ordinary shares (level 1): The 33,373,245 Nyrada ordinary shares held by the consolidated entity were valued at fair value, using the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date; and assumes that the transaction will take place either: in the principal market; or in the absence of a principal market, in the most advantageous market. The price used for valuing these ordinary shares was the ASX price of 32 cents. Nyrada performance shares (level 3): The 12,000,600 Nyrada performance shares were externally valued considering Level 3 hierarchy fair value inputs such as - the spot price of 32 cents, a risk free interest rate of 0.1952% (based on Australian government bond rate as a proxy), a historical volatility factor of 83.53% and the Monte Carlo approach for estimating the probability of the market based vesting conditions being achieved. The milestones to be achieved for each tranche is as follows: Tranche 1: i) ii) Tranche 2: i) ii) The trading price for Nyrada CDIs on ASX achieving at least $0.40 for 5 consecutive trading days; and The Scientific Advisory Board to the Company determining that, based on in-vivo data, the final lead neuroprotectant drug candidate is ready to proceed to pre-clinical safety and toxicology studies ("non-CDI price-based milestone"). The trading price for Nyrada CDIs on ASX achieving at least $0.40 for 5 consecutive trading days; and The Scientific Advisory Board to the Company determining that, based on in-vivo data, the final lead peripheral neuropathic pain drug candidate is ready to proceed to pre-clinical safety and toxicology studies ("non-CDI price-based milestone"). NOTE 3. OPERATING SEGMENTS The consolidated entity continues to operate in one segment, being the clinical development in the field of both oncology and non- oncology in the pan-pacific region. The segment details are therefore fully reflected in the body of the annual report. NOTE 4. OTHER INCOME Interest income Federal Government Covid assistance R&D tax incentives/Government Grants Research Service Fees Other income Consolidated 2021 $ 2020 $ 139,472 50,000 11,307 50,000 5,592,251 8,282,255 16,000 - 5,797,723 8,343,562 34 NOTE 5. EXPENSES Loss before income tax includes the following specific expenses: Corporate Administration expenses Corporate administration expenses Audit, accounting and company secretarial fees Travel and entertainment expenses Insurances Legal fees ASX and filing fees Consulting fees IPO and placement costs Marketing and advertising Consulting, Employee and Director Expenses Consulting expenses Employee related expenses Superannuation and other employee related expenses Director expenses (excluding executive directors) Share-based payment expense - Noxopharm Limited Share-based payment expense - Nyrada Inc Finance costs Interest and finance charges paid/payable Fair value movement in derivative liability Finance costs expensed NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 Consolidated 2021 $ 2020 $ 404,205 253,802 - 545,636 218,810 171,314 - - 128,859 758,163 346,526 179,876 561,941 473,208 254,718 183,160 502,787 123,949 1,722,626 3,384,328 389,993 3,122,666 258,740 161,250 1,742,043 - 1,091,162 3,332,270 460,599 212,260 51,988 259,614 5,674,692 5,407,893 2,186,221 3,466,847 477,524 - 2,663,745 3,466,847 35 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 6. INCOME TAX Consolidated 2021 $ 2020 $ Numerical reconciliation of income tax expense and tax at the statutory rate Loss before income tax expense (9,346,749) (999,573) Tax at the statutory tax rate of 26% (2020: 27.5%) (2,430,155) (274,883) Tax effect amounts which are not deductible/(taxable) in calculating taxable income: R&D tax incentives Other expenses not deductible 1,452,675 2,499,677 (107) (2,535) Deferred tax (liability)/asset relating to tax losses not recognised 2,081,643 (2,169,447) Net movement in temporary differences not recognised (1,104,056) (52,812) Income tax expense - - ACCOUNTING POLICY FOR 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 applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses. The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period in the countries where the Company's subsidiaries and associates operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities. Deferred tax assets are recognised only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses. 36 NOTE 7. CURRENT ASSETS - CASH AND CASH EQUIVALENTS NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 Cash at bank and in hand Term Deposit at call Bank debit cards ACCOUNTING POLICY FOR CASH AND CASH EQUIVALENTS Consolidated 2021 $ 2020 $ 16,753,142 7,034,958 10,000,000 - 42,643 65,244 26,795,785 7,100,202 Cash and short maturity of three months or less, or redeemable at any time. ‐ term deposits includes cash at bank (including debit cards) and in hand and short term deposits with an original ‐ For the purposes of the Statement of cash flows, cash and cash equivalents consist of cash and cash equivalents as defined above. NOTE 8. CURRENT ASSETS - TRADE AND OTHER RECEIVABLES Accounts receivable GST receivable R&D rebate receivable Interest receivable Consolidated 2021 $ 2020 $ 4,400 277,816 8,776 137,873 5,500,000 4,500,000 17,008 - 5,794,824 4,637,873 5,799,224 4,646,649 ACCOUNTING POLICY FOR TRADE AND OTHER RECEIVABLES Trade and other receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less an allowance for impairment, once they become over due by more than 60 days. A separate account records the impairment. An allowance for a doubtful debt is made when there is objective evidence that the consolidated entity will not be able to collect the debts. The criteria used to determine that there is objective evidence that an impairment loss has occurred include whether the Financial Asset is past due and whether there is any other information regarding increased credit risk associated with the Financial Asset. Bad debts which are known to be uncollectible are written off when identified. Other receivables are recognised at amortised cost, less any allowance for expected credit losses. 37 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 9. CURRENT ASSETS - OTHER ASSETS Prepayments Inventories Consolidated 2021 $ 2020 $ 67,517 311,510 63,312 519,230 379,027 582,542 The inventories are mainly materials that are used in the research and development process. These materials are recognised as an expense as and when they are utilised in the research and development process. NOTE 10. NON-CURRENT ASSETS – RECEIVABLES Consolidated 2021 $ 2020 $ Loan to Nyrada Inc. - 225,232 The loan to Nyrada Inc. was settled in cash on 29 March 2021. NOTE 11. NON-CURRENT ASSETS - INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD Consolidated 2021 $ 2020 $ Investment in Associate - 6,539,080 Reconciliation Reconciliation of the carrying amounts at the beginning and end of the current and previous financial year are set out below: Opening carrying amount Share of loss after income tax 1 6,539,080 7,634,697 (1,040,874) (1,095,617) Reclassification to financial assets at fair value through profit and loss (5,498,206) - Closing carrying amount - 6,539,080 1 The share of loss after income tax is the consolidated entity's share of the Nyrada Inc. loss for each period based on the number of shares held by the consolidated entity divided by the Nyrada average shares on issue. Further information on the Nyrada losses can be found in the published results of Nyrada Inc. Nyrada Inc. completed a capital raise on 29 June 2021, diluting the percentage of ownership of Noxopharm. As a result the consolidated entity is deemed to have lost significant influence and is no longer treating this as an investment in associate but as an investment at fair value. See note 12 for further information. 38 NOTE 12. NON-CURRENT ASSETS - FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT AND LOSS NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 Investment in Nyrada Inc.- ordinary shares Investment in Nyrada Inc.- performance shares Consolidated 2021 $ 10,679,439 3,592,980 14,272,419 2020 $ - - - Refer to note 20 for further information on fair value measurement. On 29 June Nyrada Inc. completed a capital raise diluting the ownership percentage of the consolidated entity below 20%. As a result the consolidated entity lost significant influence over Nyrada, resulting in the investment being reclassified from the equity method to fair value method of accounting. The resulting reclassification of the investment resulted in a gain of $8,774,212, and an increase in non-current assets of $8,774,212. The investment in Nyrada Inc. is the fair value of the 33,373,245 Nyrada shares received upon Nyrada's listing on the ASX, and the fair value of the 12,000,600 performance shares received. Refer to note 2 Critical accounting judgements, estimates and assumptions - valuation of investment in Nyrada for further information in relation to the valuation of the respective Nyrada shares. NOTE 13. NON-CURRENT ASSETS - RIGHT-OF-USE ASSETS Consolidated 2021 $ 2020 $ Land and buildings - right-of-use 349,308 658,110 Reconciliations Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out below: Consolidated $ - 733,784 (75,674) 658,110 (308,802) 349,308 Balance at 1 July 2019 Additions Depreciation expense Balance at 30 June 2020 Depreciation expense Balance at 30 June 2021 39 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 14. CURRENT LIABILITIES – BORROWINGS Convertible loan payable Lease liability - building Consolidated 2021 $ 2020 $ - 4,342,000 231,666 244,820 231,666 4,586,820 Refer to note 19 for further information on financial instruments. The convertible loan payable was settled on 31 May 20201 through the issue of 9,250,867 Noxopharm shares to the three convertible note holders at an issue price of $0.513 as full consideration of the loan balance. ACCOUNTING POLICY FOR BORROWINGS Loans and borrowings are initially recognised at the fair value of the consideration received, net of transaction costs. They are subsequently measured at amortised cost using the effective interest method. NOTE 15. NON-CURRENT LIABILITIES – BORROWINGS Lease liability - building 117,642 413,290 Refer to note 19 for further information on financial instruments. Consolidated 2020 $ 2019 $ 40 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 16. EQUITY - ISSUED CAPITAL Consolidated Consolidated 2021 Shares 2020 Shares 2021 $ 2020 $ Ordinary shares - fully paid 288,221,727 213,200,580 72,622,560 41,631,007 MOVEMENTS IN ORDINARY SHARE CAPITAL Date Shares $ 213,200,580 41,631,007 Details Balance Conversion of collateral shares Issue of underwriter options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Share Placement Share placement cost Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Conversion of short term loan convertible note Exercise of options Balance 1 July 2020 22 July 2020 14 August 2020 14 August 2020 9 October 2020 26 October 2020 18 November 2020 1 December 2020 10 December 2020 15 December 2020 22 January 2021 3 February 2021 5 February 2021 15 February 2021 19 February 2021 26 February 2021 4 March 2021 14 April 2021 30 April 2021 7 May 2021 31 May 2021 21 June 2021 30 June 2021 41 10 December 2020 42,592,592 - - 40,000 976 784 650,000 5,571 - 333 1,789,612 2,623,265 1,917,073 729,705 2,942,061 8,267,133 4,112,664 4,215 2,963 1,333 267,638 (5,111,573) 12,000 293 235 339,086 1,694 22,926,647 (1,455,000) 100 536,884 786,980 726,597 218,912 1,178,179 2,480,140 1,233,799 1,265 889 400 9,250,867 6,819,388 90,000 27,000 288,221,727 72,622,560 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 16. EQUITY - ISSUED CAPITAL (CONTINUED) ORDINARY SHARES Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the company in proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the company does not have a limited amount of authorised capital. On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote. SHARE BUY-BACK There is no current on-market share buy-back. CAPITAL RISK MANAGEMENT The consolidated entity's objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can provide returns for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to reduce the cost of capital. Capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. Net debt is calculated as total borrowings less cash and cash equivalents. In order to maintain or adjust the capital structure, the consolidated entity may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. The consolidated entity would look to raise capital when an opportunity to invest in a business or company was seen as value adding relative to the current company's share price at the time of the investment. The consolidated entity is not actively pursuing additional investments in the short term as it continues to integrate and grow its existing businesses in order to maximise synergies. ACCOUNTING POLICY FOR ISSUED CAPITAL Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. NOTE 17. EQUITY – RESERVES Options reserve OPTION RESERVE Consolidated 2021 $ 2021 $ 8,487,119 2,708,106 The reserve is used to recognise the value of equity benefits provided to employees and directors as part of their remuneration, and other parties as part of their compensation for services. NOTE 18. EQUITY – DIVIDENDS There were no dividends paid, recommended or declared during the current or previous financial year. 42 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 19. FINANCIAL INSTRUMENTS FINANCIAL RISK MANAGEMENT OBJECTIVES The Board is responsible for overseeing the establishment and implementation of the risk management system, and reviews and assesses the effectiveness of the consolidated entity's implementation of that system on a regular basis. The consolidated entity’s activities cause no material exposure to market risk (including currency risk and interest rate risk) and credit risk. The only material exposure is liquidity risk and price risk. The consolidated entity's overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance of the consolidated entity. The consolidated entity uses different methods to measure different types of risk to which it is exposed. The consolidated entity's financial instruments consist of cash and cash equivalents, trade and other receivables, and trade and other payables. Cash and cash equivalents Term Deposits at call Trade and other payables Short term loan Lease liabilities Investment in Nyrada ordinary shares Investment in Nyrada performance shares Consolidated 2021 $ 2020 $ 7,672,948 7,100,202 19,122,837 122,837 (6,130,170) (1,786,852) - (4,342,000) (231,666) (658,110) 10,679,438 3,592,980 - - 34,706,367 436,077 PRICE RISK The consolidated entity is exposed to price risk through its investment in Nyrada Inc. A change in commodity prices (market risk) could impact the value of the investment held by the consolidated entity in Nyrada Inc. Management of the consolidated entity manages this risk by monitoring the performance of Nyrada and its underlying share price. As this is considered a long term investment and this other price risk due to market movements is out of the control of the consolidated entity, there is no direct strategy to mitigate this risk other than to carefully monitor the underlying share price. The below table shows a sensitivity analysis on the value of the investment in Nyrada ordinary shares if the Nyrada share price fluctuates by +/-20%. The tale below also shows an estimated sensitivity analysis for both tranches of Nyrada performance shares if the value fluctuates by +/- 20%. Note this is an estimated impact and does not consider movements in the probabilities of meeting the market conditions used in the Monte Carlo simulation to arrive at the valuation of these performance shares. Average price increase Average price decrease Consolidated - 2021 % change Effect on profit before tax Effect on equity % change Effect on profit before tax Effect on equity Nyrada Inc. ordinary shares 20% 2,135,888 2,135,888 (20%) (1,779,906) (1,779,906) Nyrada Inc. performance shares -Tranche 1 20% 359,298 359,298 (20%) (299,415) (299,415) Nyrada Inc. performance shares -Tranche 2 20% 359,298 359,298 (20%) (299,415) (299,415) 2,854,484 2,854,484 (2,378,736) (2,378,736) 43 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 19. FINANCIAL INSTRUMENTS (CONTINUED) LIQUIDITY RISK Vigilant liquidity risk management requires the consolidated entity to maintain sufficient liquid assets (mainly cash and cash equivalents) and available borrowing facilities to be able to pay debts as and when they become due and payable. The Company is exposed to liquidity risk via its trade and other payables. Liquidity risk is the risk that the Company will encounter difficulty in raising funds to meet the commitments associated with its financial instruments. Responsibility for liquidity risk rests with the Board who manage liquidity risk by monitoring undiscounted cash flow forecasts and actual cash flows provided to them by the Company's Management at Board meetings to ensure that the Company continues to be able to meet its debts as and when they fall due. Contracts are not entered into unless the Board believes that there is sufficient cash flow to fund the additional activity. REMAINING CONTRACTUAL MATURITIES The following tables detail the consolidated entity's remaining contractual maturity for its financial instrument liabilities. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the financial liabilities are required to be paid. The tables include both interest and principal cash flows disclosed as remaining contractual maturities and therefore these totals may differ from their carrying amount in the statement of financial position. Weighted average interest rate 1 year or less Between 1 and 2 years Between 2 and 5 years Over 5 years Remaining contractual maturities Consolidated - 2021 % $ $ $ $ $ Non-derivatives Non-interest bearing Trade payables Other payables Lease liability - - - 959,493 5,170,677 - - 231,166 117,642 Total non-derivatives 6,361,336 117,642 - - - - - - - - 959,493 5,170,677 348,808 6,478,978 Weighted average interest rate 1 year or less Between 1 and 2 years Between 2 and 5 years Over 5 years Remaining contractual maturities Consolidated - 2020 % $ $ $ $ $ Non-derivatives Non-interest bearing Trade payables Lease liability - - 1,786,852 - 244,820 413,290 Total non-derivatives 2,031,672 413,290 - - - - - - 1,786,852 658,110 2,444,962 The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed above. FAIR VALUE OF FINANCIAL INSTRUMENTS The fair values of cash and cash equivalents, trade and other receivables and trade and other payables approximate to their carrying amounts largely due to being liquid assets or liabilities that will be settled within 12 months. 44 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 20. FAIR VALUE MEASUREMENT FAIR VALUE HIERARCHY The following tables detail the consolidated entity's assets and liabilities, measured or disclosed at fair value, using a three level hierarchy, based on the lowest level of input that is significant to the entire fair value measurement, being: • • • Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly Level 3: Unobservable inputs for the asset or liability Consolidated - 2021 Assets Level 1 $ Level 2 $ Level 3 $ Total $ Nyrada Inc. ordinary shares 10,679,438 Nyrada Inc. performance shares - Total assets 10,679,438 - - - - 10,679,438 3,592,980 3,592,980 3,592,980 14,272,418 There were no transfers between levels during the financial year. ACCOUNTING POLICY FOR FAIR VALUE MEASUREMENT When an asset or liability, financial or non-financial, is measured at fair value for recognition or disclosure purposes, the fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date; and assumes that the transaction will take place either: in the principal market; or in the absence of a principal market, in the most advantageous market. Fair value is measured using the assumptions that market participants would use when pricing the asset or liability, assuming they act in their economic best interests. For non-financial assets, the fair value measurement is based on its highest and best use. Valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, are used, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. Assets and liabilities measured at fair value are classified into three levels, using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. Classifications are reviewed at each reporting date and transfers between levels are determined based on a reassessment of the lowest level of input that is significant to the fair value measurement. For recurring and non-recurring fair value measurements, external valuers may be used when internal expertise is either not available or when the valuation is deemed to be significant. External valuers are selected based on market knowledge and reputation. Where there is a significant change in fair value of an asset or liability from one period to another, an analysis is undertaken, which includes a verification of the major inputs applied in the latest valuation and a comparison, where applicable, with external sources of data. The valuation techniques used for instruments categorised in levels 1 and 3 are described below: Nyrada ordinary shares (level 1): The 33,373,245 Nyrada ordinary shares held by the consolidated entity were valued at fair value, using the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date; and assumes that the transaction will take place either: in the principal market; or in the absence of a principal market, in the most advantageous market. The price used for valuing these ordinary shares was the ASX price of 32 cents. Nyrada performance shares (level 3): The 12,000,600 Nyrada performance shares were externally valued considering Level 3 hierarchy fair value inputs such as - the spot price of 32 cents, a risk free interest rate of 0.1952% (based on Australian government bond rate as a proxy), a historical volatility factor of 83.53% and the Monte Carlo approach for estimating the probability of the market based vesting conditions being achieved. The table below shows the unobservable inputs used in measuring the level 3 fair value of financial instruments in the statement of financial position and the estimated impact of changes to these inputs. 45 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 20. FAIR VALUE MEASUREMENT (CONTINUED) Financial instruments with level 3 valuation techniques Significant unobservable inputs Estimated impact on fair value measurement Nyrada performance shares - tranche 1 Volatility of returns of Nyrada CDI's A +20% increase in the volatility will increase the value of the asset by $42,683 and profit by $42,683. Nyrada performance shares - tranche 1 Risk free interest rate Nyrada performance shares - tranche 2 Volatility of returns of Nyrada CDI's Nyrada performance shares - tranche 2 Risk free interest rate A -20% decrease in the volatility will decrease the value of the asset by ($53,172) and profit ($53,172). A +/-20% movement in the risk free interest rate used in the valuation will have no material impact of on the fair value of the asset or profit A +20% increase in the volatility will increase the value of the asset by $42,683 and profit by $42,683. A -20% decrease in the volatility will decrease the value of the asset by ($53,172) and profit by ($53,172). A +/-20% movement in the risk free interest rate used in the valuation will have no material impact of on the fair value of the asset or profit NOTE 21. KEY MANAGEMENT PERSONNEL DISCLOSURES OTHER KEY MANAGEMENT PERSONNEL The following persons also had the authority and responsibility for planning, directing and controlling the major activities of the consolidated entity, directly or indirectly, during the financial year: • Mr. Fred Bart - Non Executive Chairman • Dr. Graham Kelly - Chief Executive Officer and Managing Director • Mr. Peter Marks - Non Executive Director and Deputy Chairman • Mr. Boris Patkin - Non Executive Director • Dr. Ian Dixon - Non Executive Director (resigned 31 August 2021) • Mr. David Franks - Company Secretary COMPENSATION The aggregate compensation made to directors and other members of key management personnel of the consolidated entity is set out below: Short-term employee benefits Post-employment benefits Long-term benefits Share-based payments Consolidated 2021 $ 2020 $ 479,495 34,881 341 1,418,819 636,790 47,612 17,621 8,475 1,933,536 710,498 OTHER TRANSACTIONS WITH KEY MANAGEMENT PERSONNEL Company secretarial and bookkeeping services - provided by the Automic Group, an entity associated with Mr. David Franks, on commercial terms and conditions. 46 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 22. REMUNERATION OF AUDITORS During the financial year the following fees were paid or payable for services provided by William Buck Audit (Vic) Pty Ltd, the auditor of the company, and unrelated firms: Audit services – William Buck Audit (Vic) Pty Ltd Audit or review of the financial statements NOTE 23. CONTINGENT LIABILITIES Consolidated 2021 $ 2020 $ 66,450 76,572 The consolidated entity has given bank guarantees as at 30 June 2021 of $118,818 (2020: $118,818) to its landlords. NOTE 24. RELATED PARTY TRANSACTIONS PARENT ENTITY Noxopharm Limited is the parent entity. SUBSIDIARIES Interests in subsidiaries are set out in note 26. KEY MANAGEMENT PERSONNEL Disclosures relating to key management personnel are set out in note 21 and the remuneration report included in the directors’ report. TRANSACTIONS WITH RELATED PARTIES Company secretarial and share registry services – provided by Automic Group, an entity associated with Mr. David Franks, on commercial terms and conditions. Total fees (excluding GST) paid to Automic Group Pty Limited for the year ended 30 June 2021 was $308,236 (2020: $312,569). Automic is the share registry of Noxopharm Limited. All services provided by Automic Group during the year ended 30 June 2021 and to the date of this report were on commercial terms. Prue Kelly, spouse of Graham Kelly (Chief Executive Officer and Managing Director) is employed as the Company’s Investor Relation Manager/Executive Assistant on the Company’s employment terms and condition. Total salary inclusive of superannuation paid to Prue Kelly for the year ended 30 June 2021 was $131,856 (2020: $134,890). The total value of unlisted options granted to Prue Kelly for the year ended 30 June 2021 was $20,613 (2020: $10,594). An associated entity of Fred Bart, Bart Superannuation Pty Limited atf 4f Investments Super Fund was issued 3,080,189 shares as consideration for the settlement of his portion of the short term loan convertible note on maturity. RECEIVABLE FROM AND PAYABLE TO RELATED PARTIES There were no trade receivables from related parties at the current and previous reporting date. There were trade payables to the Automic Group of $8,324 as at 30 June 2021 (2020: $60,256). LOANS TO/FROM RELATED PARTIES There were no loans to or from related parties at the current and previous reporting date. 47 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 25. PARENT ENTITY INFORMATION Set out below is the supplementary information about the parent entity. STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME Loss after income tax Total comprehensive income STATEMENT OF FINANCIAL POSITION Total current assets Total assets Total current liabilities Total liabilities Equity Issued capital Options reserve Accumulated losses Total equity Parent 2021 $ 2020 $ (9,219,721) (4,301,730) (9,219,721) (4,301,730) Parent 2021 $ 2020 $ 32,974,035 12,327,841 47,978,773 21,673,059 6,807,195 6,685,639 7,077,336 7,194,392 72,622,560 41,631,007 8,487,119 2,708,106 (40,208,242) (29,860,446) 40,901,437 14,478,667 GUARANTEES ENTERED INTO BY THE PARENT ENTITY IN RELATION TO THE DEBTS OF ITS SUBSIDIARIES The parent entity had no guarantees in relation to the debts of its subsidiaries as at 30 June 2021. CONTINGENT LIABILITIES Except as outlined in note 23, the parent entity had no contingent liabilities as at 30 June 2021 and 2020. CAPITAL COMMITMENTS - PROPERTY, PLANT AND EQUIPMENT The parent entity had no capital commitments at 30 June 2021 and 2020. SIGNIFICANT ACCOUNTING POLICIES The accounting policies of the parent entity are consistent with those of the consolidated entity, as disclosed in note 1, except for the following: • • Investments in subsidiaries are accounted for at cost, less any impairment, in the parent entity. Dividends received from subsidiaries are recognised as other income by the parent entity and its receipt may be an indicator of an impairment of the investment. 48 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 26. INTERESTS IN SUBSIDIARIES AND ASSOCIATES The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the accounting policy described in note 1: Name Ownership interest Principal place of business / Country of incorporation 2021 % 2020 % Noxopharm Asia Limited ^^ Hong Kong Norbio Holding Pty Ltd Nyrada Inc. ^ Nyrada Pty Ltd (formerly Norbio No 1 Pty Ltd) ^ Norbio No 2 Pty Ltd ^ Cardio Therapeutics Pty Ltd ^ Pharmorage Pty Limited Australia USA Australia Australia Australia Australia - 100.00% - - - - 100.00% 100.00% 21.39% 21.39% 21.39% 21.39% 100.00% 100.00% ^ From 29 June 2021, Nyrada Inc. and its subsidiaries are no longer treated as Associates of the consolidated entity, and were reclassified to an investment at fair value. The consolidated entity's share of Nyrada Inc. losses for the year to 29 June 2021 under the Equity Method were ($1,040,874), (2020: ($1,095,617)). ^^ Noxopharm Asia Limited was deregistered on 1 April 2021 as Gazetted by the Hong Kong companies registry and no longer forms part of the consolidated group. NOTE 27. MATTERS SUBSEQUENT TO THE END OF THE FINANCIAL YEAR Except as noted above, no matter or circumstance has arisen since 30 June 2021 that has significantly affected, or may significantly affect the consolidated entity's operations, the results of those operations, or the consolidated entity's state of affairs in future financial years. 49 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 28. RECONCILIATION OF LOSS AFTER INCOME TAX TO NET CASH USED IN OPERATING ACTIVITIES Loss after income tax expense for the year (9,346,749) (999,573) Consolidated 2021 $ 2020 $ Adjustments for: Depreciation and amortisation Share of loss - associates Share-based payments Foreign exchange differences Gain on deconsolidation of Nyrada Gain on reclassification of Nyrada investment to fair value Fair value movement of derivative liability Non-cash finance costs Accrued interest Change in operating assets and liabilities: 261,723 1,040,874 1,723,797 3,697 - (8,774,212) 477,524 2,178,222 (17,008) 241,445 1,095,617 311,602 - (11,585,717) - - 3,429,305 (4,019) Increase in trade and other receivables (1,139,774) (4,722,649) Decrease in inventory Increase in trade and other payables Increase in employee entitlements 207,720 4,343,318 190,427 177,170 767,481 151,380 Net cash used in operating activities (8,850,441) (11,137,958) 50 NOTE 29. EARNINGS PER SHARE Loss after income tax Non-controlling interest NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 Consolidated 2021 $ 2020 $ (9,346,749) (999,573) - 727,480 Loss after income tax attributable to the owners of Noxopharm Limited (9,346,749) (272,093) Weighted average number of ordinary shares used in calculating basic earnings per share Weighted average number of ordinary shares used in calculating diluted earnings per share Basic earnings per share Diluted earnings per share Number Number 263,850,689 138,357,822 263,850,689 138,357,822 Cents (3.54) (3.54) Cents (0.20) (0.20) The 56,546,540 (2020: 51,119,409) options issued could potentially dilute basic earnings per share in the future, but were not included in the calculation of diluted earnings per share because they are anti-dilutive for the periods presented. ACCOUNTING POLICY FOR EARNINGS PER SHARE Basic earnings per share Basic earnings per share is calculated by dividing the profit attributable to the owners of Noxopharm Limited, excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the financial year. Diluted earnings per share Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential ordinary shares. 51 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 30. SHARE-BASED PAYMENTS During the year, the Company has granted the following share-based payments: 2021 Grant date Expiry date Exercise price Balance at the start of the year Granted Exercised Expired/ forfeited/ other Balance at the end of the year 03/12/2019 03/12/2023 $0.3055 2,666,666 - (2,666,666) 14/08/2020 14/08/2023 $0.3000 06/11/2020 06/11/2024 $0.5500 15/12/2020 15/12/2022 $0.3150 15/12/2020 15/12/2022 $0.3150 15/12/2020 15/12/2022 $0.3150 31/05/2021 15/12/2024 $0.6810 31/05/2021 15/12/2024 $0.6810 - - - - - - - 25,304,819 (115) 1,050,000 1,000,000 1,000,000 1,000,000 125,000 125,000 - - - - - - - - - - - - - - - 25,304,704 1,050,000 1,000,000 1,000,000 1,000,000 125,000 125,000 * The exercise price of the options granted to Boris Patkin is calculated based on the volume weighted average price (“VWAP”) of Noxopharm shares for the last 14 trading days prior to 15 December 2020 plus 20%, equalling $0.681. 2,666,666 29,604,819 (2,666,781) - 29,604,704 Set out below are the options exercisable at the end of the financial year: Grant date 28/11/2017 08/12/2017 10/12/2018 23/07/2019 03/12/2019 18/06/2020 14/08/2020 15/12/2020 15/12/2020 15/12/2020 Expiry date 27/11/2020 30/11/2021 21/11/2022 23/07/2023 03/12/2023 18/06/2023 14/08/2023 15/12/2022 15/12/2022 15/12/2022 2021 Number - 319,213 521,110 4,777,222 - 20,037,101 25,304,704 1,000,000 1,000,000 1,000,000 2020 Number 1,000,000 257,564 288,680 4,777,222 2,666,666 20,304,792 - - - - The weighted average remaining contractual life of options outstanding at the end of the financial year was 2.04 years. 53,959,350 29,294,924 52 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 NOTE 30. SHARE-BASED PAYMENTS (CONTINUED) For the options granted during the financial year, the valuation model inputs used to determine the fair value at the grant date, are as follows: Grant date Expiry date Share price at grant date Exercise price Expected volatility Dividend yield Risk-free interest rate Fair value at grant date 14/08/2020 14/08/2020 $0.3250 $0.3000 98.29% 14/11/2020 06/11/2021 $0.5000 $0.5500 98.29% 17/11/2020 15/12/2020 $0.6750 $0.3150 100.00% 17/11/2020 15/12/2020 $0.6750 $0.3150 100.00% 17/11/2020 15/12/2020 $0.6750 $0.3150 100.00% 31/05/2021 15/12/2021 $0.7350 $0.6810 85.00% 31/05/2021 15/12/2022 $0.7350 $0.6810 85.00% - - - - - - - 0.12% $0.202 0.12% $0.329 0.10% $0.467 0.10% $0.464 0.10% $0.464 0.10% $0.314 0.10% $0.313 ACCOUNTING POLICY FOR SHARE-BASED PAYMENTS Equity-settled and cash-settled share-based compensation benefits are provided to employees. Equity-settled transactions are awards of shares, or options over shares, that are provided to employees in exchange for the rendering of services. Cash-settled transactions are awards of cash for the exchange of services, where the amount of cash is determined by reference to the share price. The cost of equity-settled transactions are measured at fair value on grant date. Fair value is independently determined using either the Binomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option, together with non-vesting conditions that do not determine whether the consolidated entity receives the services that entitle the employees to receive payment. No account is taken of any other vesting conditions. The cost of equity-settled transactions are recognised as an expense with a corresponding increase in equity over the vesting period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognised in profit or loss for the period is the cumulative amount calculated at each reporting date less amounts already recognised in previous periods. The cost of cash-settled transactions is initially, and at each reporting date until vested, determined by applying either the Binomial or Black-Scholes option pricing model, taking into consideration the terms and conditions on which the award was granted. The cumulative charge to profit or loss until settlement of the liability is calculated as follows: • • during the vesting period, the liability at each reporting date is the fair value of the award at that date multiplied by the expired portion of the vesting period. from the end of the vesting period until settlement of the award, the liability is the full fair value of the liability at the reporting date. All changes in the liability are recognised in profit or loss. The ultimate cost of cash-settled transactions is the cash paid to settle the liability. Market conditions are taken into consideration in determining fair value. Therefore any awards subject to market conditions are considered to vest irrespective of whether or not that market condition has been met, provided all other conditions are satisfied. If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made. An additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value of the share-based compensation benefit as at the date of modification. If the non-vesting condition is within the control of the consolidated entity or employee, the failure to satisfy the condition is treated as a cancellation. If the condition is not within the control of the consolidated entity or employee and is not satisfied during the vesting period, any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited. If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award is treated as if they were a modification. 53 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 DIRECTORS’ DECLARATION In the directors' opinion: • • • • the attached financial statements and notes comply with the Corporations Act 2001, the Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements; the attached financial statements and notes comply with Australian Accounting Standards as issued by the Australian Accounting Standards Board as described in note 1 to the financial statements; the attached financial statements and notes give a true and fair view of the consolidated entity's financial position as at 30 June 2021 and of its performance for the financial year ended on that date; and there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable. The directors have been given the declarations required by section 295A of the Corporations Act 2001. Signed in accordance with a resolution of directors made pursuant to section 295(5)(a) of the Corporations Act 2001. On behalf of the directors ___________________________ Dr Graham Kelly Director 26 August 2021 54 Noxopharm Limited Independent auditor’s report to members Report on the Audit of the Financial Report Opinion We have audited the financial report of Noxopharm Limited (the Company) and its controlled entities (together, the Group), which comprises the consolidated statement of financial position as at 30 June 2021, the consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information, and the directors’ declaration. In our opinion, the accompanying financial report of the Group, is in accordance with the Corporations Act 2001, including: (i) giving a true and fair view of the Group’s financial position as at 30 June 2021 and of its financial performance for the year ended on that date; and (ii) complying with Australian Accounting Standards and the Corporations Regulations 2001. Basis for Opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Key Audit Matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. SHARE BASED PAYMENTS Area of focus During the year the Group issued options to both staff and Directors. These options included both market and non- market vesting criteria, including: - Service (employment) conditions; and - Market-based conditions, tied to achieving share price milestones. The valuation of such options requires significant judgement and expertise, particularly in determining the likelihood of achieving the market- based conditions. The Group engaged an independent specialist to appraise the fair value of its share-based payment arrangements. How our audit addressed it Our audit procedures included: - Agreeing the material terms and conditions of each share-based payment arrangement to plan documentation; - Examining the share-based payment arrangements to determine the appropriateness of identifying each share-based payment arrangement, including checking the grant date; - Vouching the calculation of share- based payment arrangements with market conditions to reports furnished to the Group by independent specialists; - Examining the appropriateness of the amortisation model for accreting share-based payment expense to the profit or loss over the vesting period; and - Reviewing the appropriateness of the disclosure impact of the share- based payment arrangements, particularly for their impact in the Remuneration Report for plan recipients which form part of key management personnel. INVESTMENT IN NYRADA INC. Area of focus During the prior year Nyrada Inc. (Nyrada), a previous subsidiary of the Company completed its listing on the ASX and deconsolidated from the Group. At 30 June 2020, Noxopharm held a significant influence in Nyrada, with a holding of 33,373,245 shares, which was above the 20% threshold required for determining significant influence and accounting for the investment in Nyrada using the equity method of accounting. As at 29 June 2021 Nyrada conducted a significant capital raise, which, together with equity instruments issued by Nyrada that were vested and in-the-money, meant that the Group’s diluted shareholding in Nyrada fell below 20% at that date. How our audit addressed it Our audit procedures included the following; - Recalculating the diluted percentage shareholding on Noxopharm in Nyrada as at 29 June 2021 to appraise management’s assessment that a change in accounting treatment for the investment was appropriate; - Recalculating the percentage of the Nyrada loss for the period ended 29 June 2021, as recognised under the equity method of accounting; - Recalculating the fair value gain taken to the profit or loss on the change of accounting treatment; Consequently, the Group discontinued accounting for the investment using the equity method from 29 June 2021 and started to account for the investment at fair value. The investment includes two instruments, being: - Ordinary shares, that are carried at fair value based on their quoted value on the Australian Securities Exchange (ASX); and - Performance shares, that are carried at fair value based on a Monte Carlo simulation method. The directors employed an independent specialist to appraise the fair valuation of the performance shares at balance date. - Employing the services of our Corporate Advisory division to appraise the bona fides of the independent specialist employed by management to fair value the performance rights, including examining key inputs into the fair valuation; and; - Agreeing the results of the movement in investment from the loss to the investment value reported on the statement of financial position. We have also assessed the adequacy of disclosures in relation to the investment in the notes to the financial report. Other Information The directors are responsible for the other information. The other information comprises the information in the Group’s annual report for the year ended 30 June 2021 but does not include the financial report and the auditor’s report thereon. Our opinion on the financial report does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Responsibilities of the Directors for the Financial Report The directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. In preparing the financial report, the directors are responsible for assessing the ability of the Group to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or has no realistic alternative but to do so. Auditor’s Responsibilities for the Audit of the Financial Report Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. A further description of our responsibilities for the audit of these financial statements is located at the Auditing and Assurance Standards Board website at: http://www.auasb.gov.au/auditors_responsibilities/ar1.pdf This description forms part of our independent auditor’s report. Report on the Remuneration Report Opinion on the Remuneration Report We have audited the Remuneration Report included in the directors’ report for the year ended 30 June 2021. In our opinion, the Remuneration Report of Noxopharm Limited for the year ended 30 June 2021 complies with section 300A of the Corporations Act 2001. Responsibilities The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. William Buck Audit (Vic) Pty Ltd ABN 59 116 151 136 N.S. Benbow Director Melbourne, 26 August, 2021 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 SHAREHOLDER INFORMATION The shareholder information set out below was applicable as at 13 August 2021. NOX ORDINARY SHARES 1 to 1,000 1,001 to 5,000 5,001 to 10,000 10,001 to 100,000 100,001 and above Number of holders % by number of holders Total number of shares % by number of shares issued 465 1,231 732 1,527 359 4,314 10.78% 28.54% 16.97% 35.40% 8.32% 284,754 3,450,695 5,847,338 52,558,728 226,086,879 288,228,394 0.10% 1.20% 2.03% 18.24% 78.44% NOXO - (LISTED OPTIONS AT $0.30, EXPIRY 18 JUNE 2023) 1 to 1,000 1,001 to 5,000 5,001 to 10,000 10,001 to 100,000 100,001 and above Number of holders % by number of holders Total number of options % by number of options issued 254 316 114 175 34 893 28.44% 35.39% 12.77% 19.60% 3.81% 110,696 750,603 811,969 5,647,664 12,709,502 20,030,434 0.55% 3.75% 4.05% 28.20% 63.45% NOXOA - (LISTED OPTIONS AT $0.315 EXPIRY 14 AUG 2023) Number of holders % by number of holders Total number of options % by number of options issued 1 to 1,000 1,001 to 5,000 5,001 to 10,000 10,001 to 100,000 100,001 and above 3 15 11 59 42 130 1,606 37,757 78,009 2,492,137 22,695,195 25,304,704 0.01% 0.15% 0.31% 9.85% 89.69% 2.31% 11.54% 8.46% 45.38% 32.31% 59 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 UNLISTED OPTIONS EXERCISE PRICE OF $1.08, EXPIRY 27 NOV 2020. VEST 1.12.2018 Number of holders % by number of holders Total number of options % by number of options issued 10,001 to 100,000 7 100.00% 128,781 100 UNLISTED OPTIONS EXERCISE PRICE OF $1.08, EXPIRY 27 NOV 2020. VEST 1.12.2019 Number of holders % by number of holders Total number of options % by number of options issued 10,001 to 100,000 7 100.00% 128,781 100 UNLISTED OPTIONS EXERCISE PRICE OF $1.08, EXPIRY 27 NOV 2020. VEST 1.12.2020 Number of holders % by number of holders Total number of options % by number of options issued 10,001 to 100,000 7 100.00% 128,781 100 UNLISTED OPTIONS EXERCISE PRICE OF $0.62, EXPIRY 27 NOV 2022, VEST 21.11.2019 Number of holders % by number of holders Total number of options % by number of options issued 10,001 to 100,000 15 100.00% 288,681 100.00% UNLISTED OPTIONS EXERCISE PRICE OF $0.62, EXPIRY 27 NOV 2022, VEST 21.11.2020 Number of holders % by number of holders Total number of options % by number of options issued 10,001 to 100,000 15 100.00% 288,681 100.00% UNLISTED OPTIONS EXERCISE PRICE OF $0.62, EXPIRY 27 NOV 2022, VEST 21.11.2021 Number of holders % by number of holders Total number of options % by number of options issued 10,001 to 100,000 15 100.00% 288,680 100.00% 60 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 UNLISTED OPTION EXERCISE PRICE OF $0.58, EXPIRY 23 JUL 2023 Number of holders % by number of holders Total number of options % by number of options issued 100,001 and above 2 100.00% 4,722,222 100.00% UNLISTED OPTIONS EXERCISE PRICE OF $0.32, EXPIRY 23 DEC 2023 5,001 to 10,000 10,001 to 100,000 100,001 and above Number of holders % by number of holders Total number of options % by number of options issued 1 12 2 15 6.67% 80.00% 13.33% 7,212 667,708 255,208 930,128 0.78% 71.79% 27.44% UNLISTED OPTIONS EXERCISE PRICE OF $0.55, EXPIRY 6 NOV 2024 Number of holders % by number of holders Total number of options % by number of options issued 10,001 to 100,000 100,001 and above 10 4 14 71.43% 28.57% 570,000 480,000 1,050,000 54.29% 45.71% UNLISTED OPTIONS EXERCISE PRICE OF $0.315, EXPIRY 15 DEC 2022 Number of holders % by number of holders Total number of options % by number of options issued 100,001 and above 1 100.00% 3,000,000 100.00% UNLISTED OPTIONS EXERCISE PRICE OF $0.681, EXPIRY 15 DEC 2024 Number of holders % by number of holders Total number of options % by number of options issued 100,001 and above 1 100.00% 250,000 100.00% 61 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 EQUITY SECURITY HOLDERS TWENTY LARGEST QUOTED EQUITY SECURITY HOLDERS The names of the twenty largest security holders of quoted equity securities are listed below: Ordinary shares MILLIGENE PTY LTD (THE GE + PR KELLY FAM TRUST) MRS ELEANORE GOODRIDGE MILLIGENE PTY LTD (THE GE + PR KELLY FAM TRUST) KALE CAPITAL CORPORATION LTD CITICORP NOMINEES PTY LIMITED RGT CAPITAL FUND NO 5 (NOXO) PTY LTD LINK TRADERS (AUST) PTY LTD LINK TRADERS (AUST) PTY LTD GRANDOR PTY LTD MARK SCOTT FAMILY P/F A/C RHLC PTY LIMITED RHLC S/F A/C NORA GOODRIDGE INVESTMENTS PTY LIMITED BART SUPERANNUATION PTY LIMITED 4F INVESTMENTS SUPERFUND A/C SUBURBAN HOLDINGS PTY LTD THE SUBURBAN SUPER FUND A/C JAMBER INVESTMENTS PTY LTD THE AMBER SCHWARZ SUPER FUND A/C BLACKCOURT (NSW) PTY LIMITED LAWSAM SUPER FUND A/C MR FREDERICK BART HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED OGEN NOMINEES PTY LTD HALCYON NOMINEES PTY LTD HALCYON SUPER FUND A/C HELIUM MANAGEMENT PTY LTD HELIUM S/F A/C Number held 27,649,106 9,727,989 8,000,000 7,205,290 7,120,438 6,500,333 5,430,965 5,041,224 3,995,850 3,550,000 3,090,489 3,080,189 3,051,677 2,752,762 2,596,276 2,538,462 2,514,109 2,300,000 2,000,000 1,931,246 % of total shares issued 9.59% 3.38% 2.78% 2.50% 2.47% 2.26% 1.88% 1.75% 1.39% 1.23% 1.07% 1.07% 1.06% 0.96% 0.90% 0.88% 0.87% 0.80% 0.69% 0.67% 110,076,405 38.20% 62 OPTIONS OVER ORDINARY SHARES LISTED OPTIONS - (NOXO) NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 Options over ordinary shares MILLIGENE PTY LTD (THE GE + PR KELLY FAM TRUST) LINK TRADERS (AUST) LTD MR FREDERICK BART JAMBER INVESTMENTS PTY LTD (THE AMBER SCHWARZ FAM A/C) BLACKCOURT (NSW) PTY LIMITED (LAWSAM SUPER FUND A/C) RGT CAPITAL FUND NO 5 (NOXO) PTY LTD COSMOS NOMINEES PTY LTD (THE PLASTICS CENTRE S/F A/C) SOLEVU PTY LTD (RT LIN SUPER FUND A/C) LINK TRADERS (AUST) PTY LTD LAWSAM PTY LTD HSBC CUSTODY NOMINESS (AUSTRALIA) LIMITED R & J KARANGIS HOLDINGS PTY LTD (KARANGIS SUPER FUND A/C) DECANTE PTY LTD (J M EHRLICH SUPER FUND A/C) MS ALISON CLAIRE JAFFEE MR MATTHEW JAMES SACHR UBS NOMINEES PTY LIMITED MS JIN QIN WANG SUBURBAN HOLDINGS PTY LIMITED (SUBURBAN SUPER FUND A/C) BERNE NO 132 NOMINEES PTY LTD (331898 A/C) KING MANAGERS PTY LTD (KING SUPER NO 2 A/C) Number held 1,820,513 1,647,075 846,154 834,254 754,691 754,627 748,228 360,266 352,925 337,919 337,400 300,000 276,585 274,410 268,351 238,075 200,016 191,959 184,490 173,449 % of total options issued 9.09% 8.22% 4.22% 4.16% 3.77% 3.77% 3.74% 1.80% 1.76% 1.69% 1.68% 1.50% 1.38% 1.37% 1.34% 1.19% 1.00% 0.96% 0.92% 0.87% 10,901,387 54.42% 63 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 LISTED OPTIONS - (NOXOA) Options over ordinary shares CG NOMINEES (AUSTRALIA) PTY LTD CS THIRD NOMINEES PTY LIMITED (HSBC CUST NOM AU LTD 13 A/C) MS LISSA LORRAINE SACHR MRS ELEANORE GOODRIDGE JAMBER INVESTMENTS PTY LTD(AMBER SCHWARZ FAM ANZ ML A/C) LINK TRADERS (AUST) PTY LTD UBS NOMINEES PTY LTD MR MATTHEW JAMES SACHR LAWSAM PTY LTD SUNLORA PTY LTD (THE THREE FISH SUPER A/C) COSMOS NOMINESS PTY LTD (THE PLASTICS CENTRE S/F A/C) BLUE LAKE PARTNERS PTY LTD MR TONY PETER VUCIC & MSR DIANE VUCIC (VCIC FUTURE FUND A/C) Number held 4,000,000 3,961,455 1,405,000 1,282,053 914,879 914,879 841,472 733,673 666,667 609,953 604,166 448,718 425,000 MR STEPHEN EDWARD MAHNKEN & MRS DIOR LEONE MAHNKEN (THREE FSIH A/C) 400,000 MANDATE 322 PTY LTD (DORSIA A/C) GINGA PTY LTD (T G KLINGER SUPER FD A/C) SOLEVU PTY LTD (RT LIN SUPER FUND A/C) DR JOSHUA EHRLICH MR WILLIAM KIESANOWSKI & OUNG HUNTER TRUSTEES 2017 LTD (Knights Stream A/C) MS ALISON CLAIRE JAFFEE 384,615 356,355 333,333 315,938 292,300 256,412 % of total options issued 15.81% 15.66% 5.55% 5.07% 3.62% 3.62% 3.33% 2.90% 2.63% 2.41% 2.39% 1.77% 1.68% 1.58% 1.52% 1.41% 1.32% 1.25% 1.16% 1.01% 19,146,868 75.67% 64 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 UNQUOTED EQUITY SECURITIES There are no unquoted equity securities. HOLDERS OF MORE THAN 20% OF UNQUOTED EQUITY SECURITY HOLDERS (EXCLUDING EMPLOYEE INCENTIVE SCHEMES) Unlisted Options (Exercise price $0.58, expiry 23 July 2023) LIND GLOBAL MACRO FUND LP L1 CAPITAL Unlisted Options (Exercise price $0.315, expiry 15 December 2022) Number held % of total securities 2,361,111 2,361,111 50.00% 50.00% FREDERICK BART 3,000,000 100.00% Unlisted Options (Exercise price $0.681, expiry 15 December 2024) BORIS PATKIN 250,000 100.00% SUBSTANTIAL HOLDERS Substantial holders in the company are set out below: MILLIGENE PTY LTD (THE GE + PR KELLY FAM TRUST) AND OTHERS MRS ELEANORE GOODRIDGE VOTING RIGHTS The voting rights attached to ordinary shares are set out below: ORDINARY SHARES Ordinary shares Number held 36,162,294 15,185,849 % of total shares issued 12.55% 5.27% On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote. OPTIONS All quoted and unquoted options do not carry any voting rights. There are no other classes of equity securities. ASX LISTING RULE 3.13.1 AND 14.3 The Company advises that the Annual General Meeting (AGM) of the Company is scheduled for Wednesday 17 November 2021 at 1.00pm (AEDT). The location of the AGM is subject to COVID-19 restrictions, including regulatory requirements. Further details, including any hybrid or virtual meeting arrangements, will be confirmed closer to the AGM. Further to Listing Rule 3.13.1, Listing Rule 14.3, nominations for election of directors at the AGM must be received not less than 30 Business Days before the meeting, being no later than Wednesday 6 October 2021. 65 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 CORPORATE DIRECTORY Board of Directors Fred Bart, Non-Executive Chairman Graham Kelly, Chief Executive Officer and Managing Director Peter Marks, Non-Executive Director and Deputy Chairman Boris Patkin, Non-Executive Director Company Secretary David Franks Registered Office Principal Place of Business Level 20, Tower A, The Zenith 821 Pacific Highway CHATSWOOD NSW 2067 Level 20, Tower A, The Zenith 821 Pacific Highway CHATSWOOD NSW 2067 Website www.noxopharm.com Share Register Automic Pty Ltd Level 5, 126 Phillip Street Sydney, NSW 2000 Auditors William Buck Audit (Vic) Pty Ltd Level 20, 181 William Street Melbourne, VIC 3000 Stock Exchange Australian Securities Exchange 20 Bridge Street Sydney, NSW 2000 ASX Code NOX 66 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 67 NOXOPHARM LIMITED (ASX:NOX) - ANNUAL REPORT FY21 68 

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