AnnuAl RepoRt
2012
highlights
2011–2012
Developing dendrimer products
for pharmaceutical, life science
and other applications.
VIVAGEL®
FDA grants Special
Protocol Assessment for
VivaGel® BV phase 3
Binding declaration from
FDA received approving
Starpharma phase 3
VivaGel® trials design
for treatment of bacterial
vaginosis (BV).
Pivotal phase 3
BV treatment trials
commenced and
recruitment nearing
completion
Two concurrent international
phase 3 VivaGel® trials on
track for completion by
end 2012.
European (EMA)
agreement on BV
phase 3 trials secured
Second largest market in
the world delivers regulatory
clarity on VivaGel® trials.
Phase 2 BV prevention
of recurrence trial fully
recruited
VivaGel® trial launched
and fully recruited in the
US under an Investigational
New Drug Application.
There are no existing
treatments targeting the
recurrence of BV.
Executes condom coating
agreement with Ansell
Starpharma executed a
licence agreement with
Ansell Limited (ASX:ANN)
giving Ansell marketing
rights to the VivaGel®–
coated condom in markets
excluding Japan and certain
Asian markets.
coRPoRATE
Elevation to
S&P/ASX 300 Index
Starpharma joins top
300 Australian listed
companies in recognition
of its significant growth and
market support.
A$35 million placement
and Share Purchase Plan
Successful financing priced
at no discount to market.
New appointments to
Starpharma Board
Board appointment of
industry experts Peter
Turvey and Zita Peach as
non-executive directors.
DRUG DELIVERY
Drug delivery program
shows improved efficacy
Dendrimer-docetaxel
program advancing rapidly
with clinical trial expected to
commence in 2013 following
strong preclinical data.
Lilly drug delivery
program expands
Expansion of the
development program
with partner Lilly.
AGRochEmIcAL
PRoGRAm
Crop Protection
Agreement Signed
with Nufarm
Agreement signed to
develop innovative crop
protection formulations for
Nufarm’s product portfolio
using Starpharma’s Priostar®
dendrimer technology.
ANNUAL REPORT 2012
Starpharma’s Technology Platform
Starpharma’s platform technology has applicability across multiple products and industries.
Starpharma’s Dendrimer Technology Platform
VivaGel Portfolio
Drug Delivery
Agrochemicals
Condom
coating
Bacterial
vaginosis
STI
Prevention
Improved Off
Patent Drugs
ie. Docetaxel
Pharma
Partnered
Projects
Improved
Agrochemicals
ie. Glyphosate
Partnered
Projects
Prevention
Treatment
Various other
major Pharma
companies
Contents
Chairman’s Letter
CEO’s Report
Corporate and Social Responsibility
Directors’ Report
Corporate Governance Statement
Annual Financial Report
Shareholder Information
Intellectual Property Report
Corporate Directory
2
3
8
9
25
30
71
73
74
Multibillion
dollar US
Agrochemical
company
Various other
major
Agrochemical
companies
1
STARPHARMA HOLDINGS LIMITED
Chairman’s Letter
Dear Shareholders,
On behalf of the board and management of Starpharma l am pleased to present the 2011-2012 annual report for your review.
This has been a further year of advancement for Starpharma. Significant clinical progress for our most advanced pharmaceutical product
VivaGel® was complemented by major steps forward in our other development programs both internally and with our partnered programs.
A successful major capital raise of A$35 million in November 2011 via a $32m Placement and $3 million SPP provided the capacity to advance
all our core programs with a particular focus on the bacterial vaginosis application of VivaGel® and the internal drug delivery and agrochemical
programs.
Starpharma’s strong, geographically diverse shareholder register, significant cash reserves and deep and maturing portfolio has allowed the
company to ride the waves of market volatility, but it has not escaped the effect of market forces entirely. We remain philosophical about short-
term fluctuations and continue to focus on the consistent and rapid progress made across all of our programs.
We were pleased to welcome M&G Investments as a shareholder with the fund taking a 6.7% position in Starpharma during the capital raise in
November 2011, a position which has now increased to close to 10% of Starpharma. M&G is Prudential’s UK and European fund management
business with assets of more than A$300 billion under management as of 31 March 2012. A number of other significant global funds have also
joined our register throughout the year. Attracting investors of this stature adds further credibility to Starpharma and is evidence that the
concerted efforts of our CEO, Dr Jackie Fairley, and her management team are elevating the company’s profile in international markets.
On the development front, the hard work of our clinical team sees enrolment of our Phase 3 trials for bacterial vaginosis rapidly nearing
completion, and continued engagement with the FDA resulting in agreement on the endpoints of these trials which provides much confidence
to our investors and partners.
The agrochemical and crop protection program continues to produce impressive data in the improvement of major products, and the drug
delivery program has yielded results demonstrating Starpharma’s ability to improve the delivery of major cancer drugs and hormones among
others. Particularly pleasing was the extension of our collaboration with Lilly and also the first data in a breast cancer model which clearly
demonstrated the improvement in efficacy of anti-cancer drug docetaxel using dendrimer enhancement.
In the last year we welcomed two new Directors, Zita Peach and Peter Turvey, to the Starpharma board. Ms Peach brings more than 20 years
of commercial experience in the pharmaceutical sector including in such industry luminaries as Merck Sharp & Dohme and CSL, where she
served as Vice President, Business Development. Among various roles in his nearly 20 years at former employer CSL, Mr Turvey was an
Executive Vice President and was closely involved in building CSL into a major international company. Both Ms Peach and Mr Turvey bring
invaluable commercial experience and international networks to our board.
In closing, I am grateful to my fellow Directors for their wise council and advice, and on behalf of the board I offer our thanks and appreciation to
CEO Jackie Fairley, the management team and all the Starpharma staff.
An extraordinary amount of hard work and determination drives the progression of our multiple programs, and year-on-year we are seeing the
increasing returns from that hard work. Importantly, Starpharma has emerged as a leader in the Australian biotechnology sector and is among a
small group of companies with a maturing pipeline and products close to or on market. This progress is helping to drive interest and confidence
with investors.
Finally, thank you to our shareholders. We are grateful for your ongoing support, and look forward to sharing Starpharma’s successes with you
in the year ahead.
Yours sincerely,
Peter T Bartels, AO
Starpharma Chairman
2
CEO’s Report
I am pleased to provide my report on the year’s activities and our
plans for the future. It has been a year focused on achieving the
best outcomes from our clinical trial program to put Starpharma in
a strong position as we enter the commercialisation phase for
many of our products. Our VivaGel® trials for both preventing the
recurrence of bacterial vaginosis (BV) and treating BV have
enrolled exceptionally quickly and we look forward to their
completion and the release of findings.
The VivaGel® Portfolio
The commercial prospects for VivaGel® across all its possible
indications have strengthened considerably throughout the year. In
the near-term, VivaGel® for the treatment of BV has the potential to
positively impact on the quality-of-life for many millions of women.
Current treatments centre on antibiotics, which have an array of
potential side effects and inconvenient precautionary measures
accompanying their use. VivaGel®’s differentiation from standard
antibiotic treatments and its potential as a treatment for BV
recurrence means it represents a major advance for women’s
health.
BV is the most common vaginal infection globally, and the most
common cause of vaginal irritation, discharge and malodour. It is
particularly prevalent in the US, where it affects an estimated one-
third of the adult female population. Several leading international
publications including Marrazzo, et al (2011) indicate as many as
50-60% of women suffering from BV will have recurrent episodes
of the condition.
Existing treatments for BV are considered suboptimal with
relatively low cure rates, high rates of recurrence, unpleasant side-
effects, and high levels of bacterial resistance.
The market for topical treatments for BV is approximately
US$300–$350 million. There are currently no existing treatments
for the prevention of recurrence of BV and estimates for this
market are in excess of US$1 billion.
VivaGel® Approaches Final Stages of Development
The past 12 months have seen rapid progress in the late-stage
clinical development of VivaGel®. In March 2012 Starpharma
commenced two concurrent pivotal phase 3 trials for the treatment
of BV. In June 2012 Starpharma advised that enrolment for its
clinical studies had proceeded rapidly, with one of the trials
reaching 100% enrolment and the other surpassing 70%
enrolment. The design of these trials is virtually identical to
Starpharma’s successful phase 2 BV treatment trial, which
demonstrated that VivaGel® was efficacious in the treatment of BV
with a very high level of statistical significance.
Approximately 30 international sites, primarily in the US, are
involved in the two trials, each of which will involve approximately
220 participants. Trial results are anticipated before the end of
2012.
Starpharma is also advancing a second area of investigation for
VivaGel® in BV examining VivaGel®’s effectiveness as a
preventative for BV. Enrolment for its phase 2 trial was completed
in June 2012. This trial, which commenced in August 2011,
recruited 205 patients with a prior history of recurrent BV. The
primary objective of the study is to determine the efficacy of
VivaGel® compared with a placebo gel in preventing BV
recurrence.
Successful completion of the phase 3 trials will mark the
completion of the clinical requirements for VivaGel® for the
treatment of BV. After results are compiled, Starpharma plans to
prepare and submit a New Drug Application (NDA) to the US Food
and Drug Administration (FDA), as well as accelerate discussions
ANNUAL REPORT 2012
Our agrochemical and drug delivery programs have both
progressed considerably during the year, aided by our successful
capital placement in November 2011 which significantly boosted
the company’s cash position. This capital raise, and the follow on
Share Purchase Plan, were conducted at no discount to the
market and gave us the resources to accelerate the programs for
all three pillars of our business: VivaGel®, drug delivery and
agrochemicals. In particular our VivaGel® clinical program is
funded through to registration and we look forward to signing a
commercial partnership following successful trial completion.
VivaGel® for BV Treatment
Effective against the
bacteria which cause BV
Not absorbed into the
bloodstream
Lacks common antibiotic
side-effects
Can be used whilst
drinking alcohol
Compatible with condoms
Designed to have minimal
effect on ‘good’ bacteria
Can be used long term
with potential partners for the marketing rights to VivaGel® for the
management of BV.
VivaGel® represents an important milestone not only for
Starpharma, but also for the Australian biotechnology industry as it
is one of the very few examples where a new chemical entity has
been discovered by Australian scientists and independently
developed by an Australian company through to the completion of
pivotal phase 3 trials.
In January 2012 Starpharma received agreement from the FDA on
the design of its phase 3 clinical studies of VivaGel® for the
treatment of bacterial vaginosis under the FDA’s Special Protocol
Assessment (SPA) Scheme.
The SPA is a binding declaration from the FDA that the phase 3
clinical study design, endpoints, statistical analyses and other
aspects of the planned studies are acceptable to support
regulatory approval of the product.
This declaration gives the Company confidence that prioritising the
development of VivaGel® as a treatment for BV provides the most
streamlined route to market, meeting a significant medical need.
The phase 3 clinical trial program for VivaGel® has also been
agreed with the European Medicines Agency (EMA). Starpharma
presented to the EMA the proposed design of phase 3 studies and
associated aspects of the development program to support a
European Marketing Authorisation Application (MAA) for VivaGel®
for the treatment of BV.
3
STARPHARMA HOLDINGS LIMITED
The significance of the EMA feedback is that Starpharma has now
confirmed for both major global markets – Europe and the US –
that its Phase 3 program is acceptable, and positive results would
support approval of the product.
Starpharma is also continuing activities to support the commercial
launch of VivaGel®. This has included scale-up of the VivaGel®
active ingredient, SPL7013, to the tens of kilograms scale. This is
The VivaGel®-coated Condom and Other Applications
VivaGel® is also in phase 2 development as a topical microbicide
for the prevention of sexually transmitted infections (STIs) such as
genital herpes, human papillomavirus (HPV), and HIV. More than
50 million Americans are currently infected with genital herpes,
including approximately 26% of the female population. This figure
is expected to rise to 50% by 2025 at current rates of infection.
Beyond herpes, consumer demand for a broad-spectrum topical
treatment for STIs has been identified as being strong, with studies
showing 30-40% of female college students in the US willing to
buy a product of this type.
VivaGel® has also been licensed as a condom coating to market-
leading condom companies, Ansell and Okamoto, giving access to
the US$1.1 billion branded condom market for Starpharma and
important product innovations for its partners.
being done under full Good Manufacturing Practices (cGMP) at an
FDA and EU-certified manufacturer that supplies marketed
pharmaceutical actives globally. Scale-up of the finished
(VivaGel®) product to the hundreds of kilograms scale has also
been achieved. Final process validation is also well advanced.
Both Ansell and Okamoto hold strong market positions in the
global condom marketplace and their successes have been
strongly founded on a focus of innovation for sales growth.
Ansell is ranked number two globally in terms of condom sales,
marketing leading brands including Lifestyles®, ZERO® and the
highly successful SKYN® brand. It has a leading market position in
the rapidly expanding Asia Pacific and South American markets
and in Australia with around 70% market share.
Okamoto is Japan’s leading marketer of condoms with
approximately 60% share of the Japanese condom market -
estimated to be in the order of US$500 million. In addition to its
dominant position in the Japanese condom market, Okamoto also
holds strong market positions in several other Asian markets.
VivaGel® Coated Condom Partnerships
Partner
Market Position
Major Brands
Okamoto Industries
(listed on TSE)
Ansell Limited
(ASX: ANN)
No.1 in Japan with ~60%
Japanese market (the 2nd
largest condom market,
estimated at ~US$500M)
No. 4 globally with strong
positions in Korea, Taiwan,
Malaysia, Singapore and
China
Total company revenue
>US$ 760M
Skinless®
003®
Lifestyles® SKYN®
ZERO®
No. 2 globally for condom
sales with ~20% global
share of the branded
market, ~$1.1B
No. 1 in Australia with
strong growth in the USA,
China, Brazil, India and
Eastern Europe
Condom business growing
~18%
4
Drug Delivery
In the past year Starpharma has made considerable progress in its
drug delivery program, via both its internal and partnered
programs. Starpharma researchers recently reviewed the
chemistry of the top 200 top-selling pharmaceuticals worldwide
and found that more than 50% would be amenable to dendrimer
conjugation.
ANNUAL REPORT 2012
Significant value in Starpharma’s dendrimer technology is derived
from both its versatility and its ability to deliver a number of
important and valuable benefits for pharmaceuticals. These are
outlined in the table below.
Feature
Potential Benefits for Patients and/or Manufacturers
Improved Drug Efficacy
More effective treatments or lower doses
Reduced Toxicity of Actives
Reduced side-effects
Improved Drug Solubilisation
Less toxic formulations (allowing removal of toxic excipients)
Less painful injection formulations
Improved Pharmacokinetics
Less frequent dosing and less severe side effects
Targeted Drug Delivery
More effective treatments with reduced side effects
Docetaxel Program
The delivery of efficacy data as described below was a major
achievement for the company docetaxel anticancer program in the
last year, and Starpharma’s research team is now focussed on
completing the data package prior to clinical studies planned for
calendar year 2013.
Docetaxel is a leading chemotherapy drug used to treat a wide
range of solid tumours including breast, lung and prostate. It is
marketed by Sanofi Aventis as Taxotere® and generated sales in
excess of US$3 billion in 2010. Sanofi’s patents relating to
Taxotere® have lapsed in many markets, enabling the
development of this improved dendrimer-docetaxel product by
Starpharma. This improved formulation is the subject of new
patents pending coverage to 2032.
These advances in the docetaxel program were announced in
February 2012. These studies demonstrated significant
improvements in the efficacy of the dendrimer formulation over the
blockbuster cancer drug docetaxel (Taxotere®), in a breast cancer
model.
The study showed that 60% of the animals treated with
Starpharma’s dendrimer-docetaxel formulation had no evidence of
tumour 94 days after treatment, whereas all animals treated with
Taxotere® only had significant tumour regrowth at the same time
point.
A further additional benefit demonstrated by Starpharma’s
dendrimer-docetaxel formulation is that its plasma half life
(i.e. how long it lasts in the blood) is 60 times longer than for the
docetaxel/Taxotere® drug alone (30 hours compared to 30
minutes).
Partnered Programs
Starpharma’s docetaxel program continues to run in parallel with
its partnered drug-delivery programs which include a growing list of
major pharmaceutical companies including GSK and Eli Lilly and
Company (Lilly).
In December 2011 Starpharma announced the expansion of the
development program with partner Lilly. Starpharma now has a
number of projects underway with Lilly to improve the delivery of
small molecule and protein based pharmaceuticals using
Starpharma’s dendrimer technology. The development program
will include further in vivo studies followed by clinical testing, as
well as potential commercial terms should a product ultimately be
brought to market.
Starpharma is also applying its technology to a growing list of other
drug candidates, including major oncology drugs.
5
STARPHARMA HOLDINGS LIMITED
Other Applications
A further new program is the area of antibodies. There are a
number of antibodies which have been shown to be effective in
targeting tumours, to some extent limiting their growth. The
efficacy of these antibodies can be enhanced by the addition of
existing small molecule cytotoxic (cell-killing) drugs. As part of
Starpharma’s drug delivery program the company is developing
ways in which a dendrimer can be used to improve targeted
delivery.
Agrochemicals and Crop Protection
Starpharma’s work in the improvement of chemicals used in
agriculture, like pesticides and herbicides, is progressing into new
areas. Starpharma and Nufarm signed an agreement in August
2012 to develop innovative crop protection formulations for
Nufarm’s product portfolio using Starpharma’s Priostar® dendrimer
technology. Nufarm is one of the world's leading crop protection
companies with group sales for FY2011 exceeding $2 billion.
Nufarm produces products to help farmers protect their crops
against damage caused by weeds, pests and disease.
In addition to Nufarm, this program already has projects in
partnership with major international industry players. This
agreement marks the latest development in a rapidly developing
agrochemical program.
The lead candidate in Starpharma’s internal agrochemical program
is an enhanced reformulation of the best-selling herbicide
glyphosate (Roundup®), which has annual sales in excess of US$5
billion. In the same way that docetaxel’s off-patent status marks it
as a high-value target for improvement, glyphosate represents the
largest opportunity for an enhanced formulation in the US$40
billion agrochemical market. The company has already reported
results of significant enhancement of effect of glyphosate in
studies using its proprietary Priostar® technology and continues
further development in this area.
Given the huge growth area of antibodies as a treatment class, a
demonstrated ability of dendrimers to enhance antibody efficacy
would be a major asset for Starpharma. This program will continue
in parallel to its major docetaxel program.
In addition, Starpharma is now applying its dendrimer technology
to a number of other off-patent agrochemical agents with the
potential for reduction or removal of environmentally damaging
solvents.
Some crop protection products contain up to 70% hydrocarbon
solvents. Typically growers and regulators prefer formulations
without these solvents, which are toxic to handle, highly flammable
and expensive to transport and leave a residue when sprayed on
crops. A reduction in these solvents would be welcome from
social, environmental and economic perspectives, and regulators
are increasingly working with agrochemical companies to address
these issues.
The potential benefits of dendrimer-reformulated agrochemicals
include:
Solubility enhancement for more concentrated
formulations, reducing transport costs and solvent
residues;
Improved herbicidal activity;
Modification of soil penetration properties; and
Increased adhesion reducing losses due to rain run-off
and the need for multiple applications.
Starpharma’s agrochemical and crop protection program has the
potential to add further value to the agrochemical industry’s largest
products making this an exciting area within Starpharma’s core
development program.
Other applications
The optionality of Starpharma’s dendrimer platform technology has
allowed partnerships with a diverse range of companies in very
different product areas. These areas include diagnostics and
laboratory reagents, animal health and cosmetics.
6
5 Year Financial Summary
Royalty, customer and licence revenue
Grant income
Interest revenue
Total revenue & income
Expenditure
Income tax credit
Net loss after tax
Cash outflow before new capital (Cash Burn)
Cash Burn adjusted for exchange rate
movements
New share capital net proceeds
Cash at end of year
Overview of financial results
2012
$M
2011
$M
0.9
0.2
1.8
2.9
1.1
1.2
1.0
3.3
ANNUAL REPORT 2012
Year Ended 30 June
2009
$M
2008
$M
2.0
7.7
0.1
9.8
1.4
8.2
0.3
9.9
2010
$M
1.4
3.8
0.7
5.9
(16.6)
(12.2)
(12.3)
(14.1)
(18.1)
-
(13.7)
(9.9)
(10.0)
33.7
42.8
-
(8.9)
(7.5)
(6.7)
3.6
18.9
-
(6.4)
(3.9)
(3.8)
15.1
22.8
0.2
(4.1)
(2.9)
(4.2)
7.0
11.6
0.7
(7.5)
(6.1)
(5.5)
3.5
7.5
For the period ended 30 June 2012, the key metric of net cash
burn for the year was $9.9 million, with cash reserves at 30 June
2012 of $42.8 million. Starpharma reported a net loss after tax of
$13.7 million and had net cash outflows of $9.8 million from
operations. Cash flow from financing activities of $33.7 million
included the proceeds of the equity raise and the exercise of
options during the year.
The reported net loss after tax of $13,658,000 is consistent with
the company’s strategic plans and budget estimates. The increase
in expenditure includes the phase 2 VivaGel® clinical trial for the
prevention of recurrence of bacterial vaginosis and the two pivotal
phase 3 VivaGel® clinical trials for the treatment of bacterial
vaginosis. Expenditure has also increased with additional
Starpharma internal development programs for drug delivery and
agrochemicals, including docetaxel and glyphosate.
Total revenue and other income for the year was $2,904,000, a
reduction of $399,000 from the previous year, on lower grant
income from the US National Institutes of Health. The decrease in
grant funding is partly offset by interest revenue earned on cash
deposits.
A contra research and development expense of $1,323,000 has
been recorded for research and development activities eligible
under the Australian Government tax incentive from 1 July 2011.
Outlook
Starpharma has delivered major tangible advances across several
areas in the last year. Reaching agreement with regulators and
executing phase 3 trials is extremely resource-intensive and our
swift recruitment and positive interactions with the major regulatory
agencies of the FDA and EMA have been achievements in
themselves. The end of calendar 2012 should see our current
phase 2 and concurrent phase 3 trials for VivaGel® completed, and
the next stage of engagement with regulatory agencies underway.
We expect to be in a position to achieve the very significant
milestone of submitting a New Drug Application in 2013. We look
forward to sharing the results of these various trials.
Our other major programs in drug delivery and agrochemicals are
also progressing well, with significant scientific results announced
from our internal docetaxel program in 2012. Clinical trials are
planned for this program in 2013. The analysis that 50% of the
world’s 200 best-selling pharmaceutical products could potentially
be enhanced by dendrimers is testament to the huge versatility of
the Starpharma technology platform which underpins all our work
and we will continue to expand our extensive partnered programs.
These already include many of the top 10 global pharmaceutical
companies.
We are confident Starpharma’s strong platform technology and
business fundamentals will continue to deliver shareholder value in
the coming year.
Jackie Fairley
CEO
7
STARPHARMA HOLDINGS LIMITED
Corporate and Social Responsibility
Starpharma is a world leader in the development of dendrimer
products for pharmaceutical, life science and other applications,
and aims to create value through the commercialisation of its
proprietary products. In striving for this objective, Starpharma
acknowledges its role within society and believes its success will
deliver long term positive benefits to all stakeholders.
Starpharma’s corporate governance principles and code of
conduct set the framework for how the company, management and
employees are expected to conduct themselves: always ethically
and responsibly.
Our People
The employees of Starpharma are critical for achieving business
success. To ensure Starpharma remains a safe, healthy, and
attractive workplace for our employees, Starpharma has
established work place policies and practices. Policies assist to
ensure employees have engaging and satisfying roles and receive
periodic assessments and feedback on performance. Policies
provide for ongoing training and career development, and are
intended to ensure a balanced work and home life. Starpharma’s
Code of Conduct reflects the core values of the company and sets
out standards of behaviour in matters including equal employment
opportunity and best practice in recruitment.
Employees are rewarded for their performance, dedication, and
contribution to the results of Starpharma. Employees are recruited
into and retained in positions based on merit. A balance of skills,
expertise and opinion, as well as diversity are viewed as important
The Community
The very nature of Starpharma products affords the opportunity of
changing lives for the better. Through innovative research and
development, Starpharma is creating products for needs which are
currently unmet, either within the public health, medical, life
sciences or other markets.
Our Partners
Starpharma has established important business and scientific
partnerships with leading global companies, international medical
research organisations and key governmental and non-
governmental departments and institutions. These relationships
The Environment
cultural elements within the collegiate team environment. The
Board has adopted a Diversity Policy to provide a framework for
Starpharma to achieve a number of diversity objectives, with an
initial focus on gender.
Employee equity participation schemes are used to provide the
opportunity for all staff to share in the business success of the
company and to assist in aligning the objectives of employees with
those of shareholders.
Occupational health and safety is considered every employee’s
responsibility, and a safe working culture is promoted and
encouraged. There is an active committee structure to eliminate,
reduce or mitigate risks associated with Starpharma’s activities.
Occupational Health & Safety Committee members represent all
sections of the workplace including management and employees.
All of Starpharma’s pharmaceutical products and clinical research
activities comply with strict regulatory and ethical approval
processes. These include the FDA in the United States and other
regulatory bodies as applicable.
offer critical analysis of research concepts from world experts in
their field and provide the pathway for products to enter the market
and change daily lives.
The broad application of Starpharma’s dendrimer research
extends into projects that may assist the environment. Research in
the field of agrochemicals may improve existing products and
reduce the negative impact of current practices on the
environment. More effective chemical formulations for
agrochemicals could reduce the frequency of application and
potentially improve the environmental profile of such products.
Early studies in combining the company’s proprietary dendrimer
technology with major agrochemicals indicate that improvements
such as enhanced solubility, better adhesion to plants and
modification of soil penetration properties are possible.
In conducting its research and operations Starpharma has
documented procedures and processes in place to ensure that all
waste products (albeit relatively minor in volume) are disposed of
strictly in accordance with relevant environment regulations.
8
ANNUAL REPORT 2012
Directors’ Report
Your directors have pleasure in presenting this report on the consolidated entity (referred to hereafter as the group) consisting of Starpharma
Holdings Limited and the entities it controlled at the end of, or during, the year ended 30 June 2012.
Directors
The following persons were directors of Starpharma Holdings Limited (“the company”) during the whole of the financial year
and up to the date of this report:
P T Bartels (Chairman)
R Dobinson
P J Jenkins (Deputy Chairman)
R A Hazleton
J K Fairley (Chief Executive Officer)
Z Peach and P R Turvey were appointed as directors on 1 October 2011 and 19 March 2012 respectively and continue in office at the date of
this report.
Principal Activities
The principal activities of the group consist of development and
commercialisation of dendrimer products for pharmaceutical, life-
science and other applications. Activities within the group are
directed towards the development of precisely defined nano-scale
materials, with a particular focus on the development of its topical
vaginal microbicide VivaGel® for the treatment and prevention of
bacterial vaginosis, as a condom coating, and prevention of genital
herpes and HIV, and the application of dendrimers to drug delivery
Business Objective
and other life science applications. More broadly, through partners
the group is exploring dendrimer opportunities in materials science
with applications in areas such as cosmetics, agrochemicals, and
coatings. Products based on the group’s dendrimer technology are
on the market in the form of diagnostic elements and laboratory
reagents.
The company aims to create value for shareholders through the commercial exploitation of proprietary products based on its dendrimer
technology in pharmaceutical, life science and other applications.
Dividends
No dividends were paid or declared during the period and no dividends are recommended in respect to the financial year ended 30 June 2012.
(2011: Nil)
Review of Operations
Achievements and significant events during the 2012 financial year
included:
August 2011 Starpharma executes condom coating agreement
with Ansell
July 2011 Advances agrochemical program with improved
performance of major product
Starpharma’s studies have demonstrated a number of
improvements in these preliminary studies including the ability to
increase the effectiveness of agrochemicals such as glyphosate,
the most commonly used herbicide globally (also known by the
trade name Roundup®) with annual sales in excess of US$5 billion.
August 2011 Commences BV Prevention Study of VivaGel®
The phase 2 study of VivaGel® for the prevention of bacterial
vaginosis (BV) commenced following receipt of ethics approval.
The primary objective of the study is to determine the efficacy of
two strengths of VivaGel® (1% and 3%) compared with a placebo
gel in preventing recurrence of BV. Whilst the duration of use of
the product in this study is 16 weeks, it is intended that women
would use the product as a long-term prevention tool if proven
effective.
August 2011 Starpharma terminates condom coating agreement
with Reckitt Benckiser
Due to the failure to achieve satisfactory progress in relation to
certain commercialisation milestones for the VivaGel®-coated
condom, Starpharma’s board took the decision to terminate the
Licence granted to Reckitt Benckiser (RB; formerly SSL
International plc) to commercialise the VivaGel®-coated condom
and all of RB’s rights to the product, effective immediately.
Starpharma executed a Licence Agreement with Ansell Limited
(ASX:ANN) giving Ansell marketing rights to the VivaGel®-coated
condom. The Agreement covers marketing rights to the coated
condom in countries which exclude Japan and a number of Asian
markets.
Under the agreement Ansell will pay Starpharma royalties on sales
of VivaGel®-coated condoms and will support registration and
other commercialisation costs. Ansell is also responsible for
manufacturing the VivaGel®-coated condom and marketing of the
product, which will include the VivaGel® brand together with the
respective Ansell brand.
September 2011 Starpharma elevated to S&P/ASX300 index
The S&P/ASX 300 Index provides additional depth and coverage
to the S&P/ASX 200. It provides up to an additional 100 small-cap
stocks to the S&P/ASX 200, and is designed to address
investment managers' needs to benchmark against a portfolio
characterized by sufficient size and liquidity.
October 2011 Secures FDA agreement on BV treatment Phase 3
The Phase 3 clinical trial program for the VivaGel® bacterial
vaginosis (BV) treatment program was agreed with the US Food
and Drug Administration (FDA) following recent positive trial
results and subsequent End of Phase 2 (EOP2) Meeting.
Following EOP2 meeting discussions, Starpharma and the FDA
are in agreement on Phase 3 clinical trial design, including
definition of primary and secondary endpoints, patient numbers
and other design parameters.
9
STARPHARMA HOLDINGS LIMITED
November 2011 Starpharma completes A$32 million placement
Starpharma successfully raised A$32 million via a placement to
international and domestic institutional, sophisticated and
professional investors.
The placement was conducted at the last closing price prior to
Trading Halt (A$1.075 per share), and was significantly
oversubscribed. There was strong participation in the placement
from existing institutions including large global funds and local
investors. A major new international institution became a
significant shareholder via the placement.
November 2011 Secures European (EMA) agreement on BV
treatment Phase 3
The Phase 3 clinical trial program for VivaGel® bacterial vaginosis
(BV) treatment was agreed with the European Medicines Agency
(EMA).
This European scientific advice is in addition to the agreement
recently reached with the US FDA announced in October 2011.
December 2011 SPP closes heavily oversubscribed
The Share Purchase Plan (SPP) capped at $3 million was
oversubscribed by more than 400%. As a result of the strong
demand and oversubscription, applications needed to be scaled
back.
The SPP followed the placement in November to international and
domestic institutional, sophisticated and professional investors
which raised A$32 million.
December 2011 Drug delivery program with Lilly advances
In December 2011 Starpharma announced the expansion of the
development program with partner Lilly. Starpharma now has a
number of projects underway with Lilly to improve the delivery of
small molecule and protein based pharmaceuticals using
Financial Summary
Starpharma’s dendrimer technology. The development program
will include further in vivo studies followed by clinical testing, as
well as potential commercial terms should a product ultimately be
brought to market.
January 2012 Receives FDA Special Protocol Assessment for BV
Phase 3
Starpharma received final written agreement from the FDA on the
design of its Phase 3 clinical studies of VivaGel® for the treatment
of bacterial vaginosis (BV) under the FDA’s Special Protocol
Assessment (SPA) scheme.
The SPA is a binding declaration from the FDA that the Phase 3
clinical study design, endpoints, statistical analyses, and other
aspects of the planned studies are acceptable to support
regulatory approval of the product.
February 2012 Starpharma’s dendrimers improve efficacy of
docetaxel in animals
Animal data demonstrated that applying Starpharma’s dendrimer
technology to the leading chemotherapy drug docetaxel was
significantly more efficacious than docetaxel (Taxotere®) in a
breast cancer model.
March 2012 Commences pivotal phase 3 VivaGel® trials for
bacterial vaginosis treatment
The commencement of two concurrent pivotal phase 3 clinical
trials of VivaGel® for the treatment of bacterial vaginosis (BV),
following receipt of ethics approval.
June 2012 Full enrolment achieved for BV Phase 2 trial and first
Phase 3 trial
Reported that recruitment is 100% completed for its Phase 2
clinical trial to investigate the ability of VivaGel® to prevent the
recurrence of bacterial vaginosis (BV), and also for the first of two
pivotal Phase 3 studies of VivaGel® for the treatment of BV.
For the year ended 30 June 2012 the consolidated entity incurred an operating loss after income tax of $13,658,000 (June 2011: $8,930,000).
Income statement
Revenue from continuing operations
Other income
Research and development expenses
Administration expenses
Finance costs
Loss attributable to members
Year Ended 30 June
2011
$’000
2,125
1,178
(5,986)
(6,231)
(16)
(8,930)
2012
$’000
2,744
160
(12,088)
(4,466)
(8)
(13,658)
Income statement
The reported net loss after tax of $13,658,000 is consistent with
the company’s strategic plans and budget estimates. The increase
in expenditure includes the phase 2 VivaGel® clinical trial for the
prevention of recurrence of bacterial vaginosis and the two pivotal
phase 3 VivaGel® clinical trials for the treatment of bacterial
vaginosis. Expenditure has also increased in Starpharma’s internal
development programs for drug delivery and agrochemicals.
Total revenue and other income for the year was $2,904,000, a
reduction of $399,000 from the previous year, on lower grant
income from the US National Institutes of Health. The decrease in
grant funding is partly offset by higher interest revenue earned on
cash deposits.
All research and development expenditure, including patenting
costs, were fully expensed in the current and prior year.
10
A contra research and development expense of $1,323,000 has
been recorded for research and development activities eligible
under the Australian Government tax incentive from 1 July 2011.
Balance sheet
At 30 June 2012 the group’s cash position was $42,812,000 (2011:
$18,918,000) resulting from the $35 million capital raised during
the year.
ANNUAL REPORT 2012
Statement of cash flows
Net operating cash outflows for the year were $9,770,000 (2011:
$6,476,000). Cash flow from financing activities of $33,665,000
(2011: $3,508,000) included the proceeds on the raise of equity.
Earnings per share
Basic loss per share
Diluted loss per share
Net tangible assets
Net tangible asset backing per ordinary share
Significant changes in the state of affairs
2012
($0.05)
($0.05)
2012
$0.14
2011
($0.04)
($0.04)
2011
$0.07
There was an increase in contributed equity of $33,772,000 (2011: $3,633,000) the majority of which were proceeds of the equity raise which
occurred during the year.
Matters subsequent to the end of the financial year
No matters or circumstances have arisen since 30 June 2012 that
have significantly affected, or may significantly affect:
(a) the consolidated entity’s operations in future financial years, or
(b) the results of those operations in future financial years, or
(c) the consolidated entity’s state of affairs in future financial years.
Likely developments and expected results of operations
In the opinion of the directors, the group will continue its activities
as described.
Additional comments on expected results of operations of the
group are included in this report under the review of operations.
Further information on likely developments in the operations of the
group and the expected results of operations have not been
included in this annual financial report because the directors
believe it would be likely to result in unreasonable prejudice to the
group.
Regulatory Environment
There were no significant changes in laws or regulations during the
2012 financial year or since the end of the year affecting the
business activities of the group, and the directors are not aware of
any such changes in the near future.
Environmental regulation
The group is subject to environmental regulations and other
licences in respect of its research and development facilities.
There are adequate systems in place to ensure compliance with
relevant Federal, State and Local environmental regulations and
the Directors are not aware of any breach of applicable
environmental regulations by the group.
Legal
At the date of the Directors’ Report there are no significant legal issues.
Health and Safety
The board, CEO and senior management team of the group are
committed to providing and maintaining a safe and healthy working
environment for the company’s employees and anyone entering its
premises or with connection to the company’s business
operations. Employees are encouraged to actively participate in
the management of environmental and Occupational Health and
Safety (OH&S) issues. The company has adopted an OH&S Policy
and has an established OH&S Committee structure as part of its
overall approach to workplace safety. The OH&S committee
provides a forum for management and employees to consult on
health and safety matters. The primary role of the committee is to
coordinate the development and implementation of OH&S policy
and procedures, to consider any work related safety matters or
incidents, and to ensure compliance with relevant legislation and
guidelines. The committee includes representatives of
management, and employees from each operational area
generally in proportion to the number of people working in the area
and the perceived safety risks associated with working in that area.
The OH&S committee meets on a monthly basis.
11
STARPHARMA HOLDINGS LIMITED
Information on Directors
Peter T Bartels, AO, FAISM, FRS (age 71)
Independent non-executive director
Chairman
Member of remuneration & nomination committee
Member of audit & risk committee
232,930 ordinary shares in Starpharma Holdings Limited
Independent non-executive director and Chairman for nine years. Mr Bartels has considerable experience in the pharmaceutical industry; while
working for Abbott Laboratories he was responsible for the introduction of a wide range of industrial, agricultural, veterinary and human
pharmaceuticals into the Australian market. He was a director of Drug Houses of Australia and was managing director of DHA Pharmaceuticals.
He has been a major player in corporate Australia, having held the positions of CEO and Managing Director of both Coles Myer Ltd and Fosters
Brewing Company Ltd. He is a past Chairman of the Australian Sports Commission, the Australian Institute of Sport, the Commonwealth Heads
of Government Committee for Sport and the Royal Women's and Royal Children's Hospitals. Peter is presently Chair of the Dean's external
Advisory Council, for the Faculty of Medicine, Dentistry and Health Sciences at The University of Melbourne.
Other current directorships of listed entities: None
Former directorships of listed entities in last 3 years: None
Jacinth (Jackie) K Fairley BSc, BVSc (Hons), MBA (age 49)
Executive director
Chief Executive Officer
1,649,197 ordinary shares in Starpharma Holdings Limited
375,000 employee performance rights
Dr Fairley was appointed Chief Executive Officer of Starpharma on 1 July 2006 after serving in the role of Chief Operating Officer from July
2005. As CEO and a Director of the Board, Jackie's responsibilities include involvement in setting strategic direction, oversight of operations and
financing activities for the group. She also plays an active role in driving key commercial negotiations and development programs and corporate
activity. Jackie has more than 20 years’ experience in the pharmaceutical and biotechnology industries working in business development and
senior management roles with companies including CSL and Faulding (now Hospira). Former CEO of Cerylid Biosciences, Jackie also spent 5
years as a Vice President for Faulding’s injectable division and 5 years with CSL in various executive roles. She holds first class honours
degrees in Science and Veterinary Science, and has an MBA from the Melbourne Business School (MBS) where she was the recipient of the
Clemenger Medal. In 2010, Jackie was appointed to the board of directors of MBS.
Other current directorships of listed entities: None
Former directorships of listed entities in last 3 years: None
Ross Dobinson B Bus (Acc) (age 60)
Independent Non-executive director
Chairman of audit & risk committee until 14 May 2012
Chairman of remuneration & nomination committee until 14 May 2012
Nil ordinary shares in Starpharma Holdings Limited
Non-executive director for fifteen years. Merchant banker with a background in investment banking and stockbroking. Has acted as corporate
director for two leading stockbrokers, and was an executive director of the NAB’s corporate advisory subsidiary. Later headed the Corporate
Advisory Division of Dresdner Australia Ltd. Managing Director of TSL Group Ltd, a corporate advisory company specialising in establishing and
advising life sciences companies. Also a director of a number of unlisted companies.
Other current directorships of listed entities:
Executive Chairman of Acrux Ltd since 1 July 2012, previously non-executive director (director
since 2000; Chairman since 31 January 2006)
Former directorships of listed entities in last 3 years: Executive Chairman of Hexima Limited (delisted 17 June 2011) since 21 July 2010
Richard A Hazleton BSChE, MSChE, HonDrEngr, HonDrCommSci (age 70)
Independent Non-executive director
Member of remuneration & nomination committee until 14 May 2012
Member of audit & risk committee from 14 May 2012
142,616 ordinary shares in Starpharma Holdings Limited
Independent non-executive director since 1 December 2006. Former chairman of US-based global corporation Dow Corning. Joined Dow
Corning in 1965 and held numerous positions in engineering, manufacturing and finance, both in the US and Europe, before becoming Chief
Executive Officer of the company in 1993, and Chairman of the Board of Directors and CEO in 1994. Retired from Dow Corning in 2001.
Chairman of Dendritic Nanotechnologies Inc (DNT) from 2004 until Starpharma’s acquisition of the company in October 2006. Has served on
the Boards of the American Chemistry Council and the Chemical Bank and Trust Company (Midland, MI, USA) as well as several non-profit
social service agencies in Michigan and Belgium.
Other current directorships of listed entities: None
Former directorships of listed entities in last 3 years: None
Peter J Jenkins MB, BS (Melb), FRACP (age 66)
Independent Non-executive director
Deputy Chairman
Chairman of remuneration & nomination committee from 14 May 2012
Member of audit & risk committee until 14 May 2012
1,487,462 ordinary shares in Starpharma Holdings Limited
Independent non-executive director for fifteen years. Consultant physician and gastroenterologist. Holds clinical and research positions with the
Alfred Hospital and has held clinical research positions with the Baker Medical Research Centre. Former judge of the Australian Technology
Awards. Executive Director of AusBio Ltd, an unlisted public biotechnology company.
12
Other current directorships of listed entities: Nil
Former directorships of listed entities in last 3 years: Non-executive director and chairman of bio-pharmaceutical company Immuron (formerly
Anadis Ltd), resigned February 2009.
ANNUAL REPORT 2012
Zita Peach BSc (age 48)
Independent Non-executive director from 1 October 2011
Member of remuneration & nomination committee from 14 May 2012
2,000 ordinary shares in Starpharma Holdings Limited
Ms Peach has more than 20 years of commercial experience in the pharmaceutical industry, particularly in marketing and business
development, working for major industry players such as CSL Limited and Merck Sharp & Dohme (MSD), the Australian subsidiary of Merck Inc.
She is currently the Managing Director and Executive Vice President, South Asia Pacific for Fresenius Kabi Australia, a leader in infusion
therapy and clinical nutrition. Until recently Ms Peach was Vice President/Director, Business Development R&D for CSL, a position she held for
ten years. Ms Peach is a Non-Executive Director of the ASX-listed Vision Eye Institute Limited.
Other current directorships of listed entities: Vision Eye Institute Limited
Former directorships of listed entities in last 3 years: None
Peter R Turvey BA/LLB, MAICD (age 61)
Independent Non-executive director from 19 March 2012
Chairman of audit & risk committee from 14 May 2012
30,000 ordinary shares in Starpharma Holdings Limited
Mr Turvey is the former Executive Vice President Licensing and Company Secretary of global specialty biopharmaceutical company CSL
Limited having retired in 2011. He is currently a Principal of Foursight Associates Pty Ltd and a director of the industry organisation AusBiotech
Limited. After completing an Arts/Law degree at the Australian National University, he joined Biotechnology Australia, then Australia's largest
biotechnology company, as Manager of Intellectual Property and Company Secretary. He joined CSL in 1992 as its first in-house Corporate
Counsel and was appointed Company Secretary in 1998. He played a key role in the transformation of CSL from a government owned
enterprise, through ASX listing in 1994, to a global plasma and biopharmaceutical company. He also had responsibility for the protection and
licensing of CSL's intellectual property and for risk management within CSL, which included management of the internal audit function, reporting
to the Audit & Risk Management Committee of the Board as well as being the Chairman of the Corporate Risk Management Committee. Among
the many licensing deals he was involved with, the most significant included the Gardasil license to Merck & Co., the licensing of the Iscomatrix®
adjuvant platform technology to the world’s leading vaccine manufacturers, and establishment of the P.gingivalis vaccine technology
collaboration between the CRC for Oral Health and Sanofi-Pasteur.
Other current directorships of listed entities: Allied Healthcare Group
Former directorships of listed entities in last 3 years: None
Company Secretary
The Company Secretary is Mr Ben Rogers (age 64). He was a member of Starpharma’s start-up/IPO management team and has been
Company Secretary since February 1998, with responsibilities that included the role of Chief Financial Officer until 31 December 2008. Mr
Rogers has extensive experience in finance, corporate governance and HR management with CSIRO research laboratories and Co-operative
Research Centres.
Meetings of Directors
The number of meetings of the company’s board of directors and of each committee held during the year ended 30 June 2012, and the numbers
of meetings attended by each director were:
Name
P T Bartels
P J Jenkins
J K Fairley
R Dobinson
R A Hazleton
Z Peach
P R Turvey
Full meetings of directors
Meetings of committees
Audit & risk
Remuneration &
nomination
9 of 9
9 of 9
9 of 9
9 of 9
8 of 9
6 of 6
2 of 2
2 of 2
2 of 2
N/A
2 of 2
0 of 0
N/A
0 of 0
3 of 4
1 of 1
N/A
3 of 3
3 of 3
1 of 1
N/A
The table above illustrates the number of meetings attended compared with the number of meetings held during the period that the director held
office or was a member of the committee. N/A denotes that the director is not a member of the relevant committee.
13
STARPHARMA HOLDINGS LIMITED
Remuneration Report
The Remuneration report sets out remuneration information for non-executive directors, executive directors and other key management
personnel of Starpharma Holdings Limited group of companies.
Directors and key management personnel disclosed in this report
Non-executive and executive directors – see pages 12 to 13 above
Other key management personnel
N J Baade
C P Barrett
M L McColl
D J Owen
J R Paull
B P Rogers
Chief Financial Officer
VP, Business Development
VP, Business Development
VP, Research
VP, Development and Regulatory Affairs
Company Secretary
The key management personnel of the Starpharma Holdings Limited group include the five highest paid executives of the entity.
Role of the remuneration committee
The remuneration and nomination committee, consisting of three independent non-executive directors, advises the board on remuneration
policies and practices generally, and makes specific recommendations on remuneration packages and other terms of employment for executive
directors, other senior executives and non-executive directors. The objective of the company’s remuneration policy is to ensure appropriate and
competitive reward for the results delivered. The framework aligns executive reward with achievement of strategic objectives and the creation of
value for shareholders.
Non-executive director remuneration policy
Fees and payments to non-executive directors reflect the demands which are made on, and the responsibilities of, the directors. The
Chairman’s fees are determined independently from the fees of non-executive directors based on comparative roles in the external market.
Non-executive directors do not receive bonuses, share options or other forms of equity securities, or any performance-related remuneration or
retirement allowances.
Directors’ fees
Non-executive directors’ fees are reviewed annually by the remuneration and nomination committee, taking into account comparable data from
the biotechnology sector. Non-executive directors’ fees were last increased with effect from 1 January 2010. Fees and payments are determined
within an aggregate non-executive directors’ fee pool limit, which is periodically recommended for approval by shareholders. The aggregate
amount currently stands at $450,000 which was approved by shareholders on 15 November 2006. This amount (or some part of it) is to be
divided among the non-executive directors as determined by the board. The aggregate amount paid to non-executive directors for the year
ended 30 June 2012 was $362,097 (2011: $357,833). Superannuation contributions required under the Australian superannuation guarantee
legislation continue to be made and are deducted from the directors’ overall fee entitlements.
Directors’ Fees
Chair
Other non-executive directors
2012
120,000
60,000
Executive remuneration policy and framework
Remuneration packages are set at levels that are intended to attract and retain high calibre executives capable of managing the group’s
operations.
The executive pay and reward framework comprises of:
base pay and benefits, including superannuation;
short term performance incentives; and
long term incentives through participation in the Starpharma employee equity plans.
The combination of these comprises an executive's total remuneration.
Relationship between executive reward and company financial performance
The company’s remuneration policy aligns executive reward with the interests of shareholders. The primary focus is on sustained growth in
shareholder value through achievement of research, development, regulatory and commercial milestones, and therefore performance goals are
not necessarily linked to financial performance measures typical of companies operating in other market segments. Remuneration is set based
on key performance indicators (KPIs) typical of a biotechnology company in Starpharma’s lifecycle, which may include (but are not limited to)
successful negotiations of commercial contracts, achieving key research, development and regulatory milestones, and ensuring the availability
of adequate capital to achieve stated objectives. Improvement in the rating of the company against peer biotechnology companies may also be
taken into consideration in determining the performance of the executive team, and can be assessed on a qualitative basis by reviewing external
sources such as biotechnology publications and non-commissioned research reports.
Other factors taken into account in determining remuneration packages include a demonstrated record of performance, internal and external
relativities, and the company’s ability to pay.
14
ANNUAL REPORT 2012
Base pay and benefits
Executives receive their base pay and benefits structured as a Total Fixed Remuneration (TFR) package which may be delivered as a
combination of cash and prescribed non-financial benefits at the executives’ discretion.
Short-term performance incentives
With the exception of the CEO, executive service agreements do not include pre-determined bonus or equity allocations, but cash incentives
(bonuses) may be awarded at the end of the performance review cycle for specific contributions, or upon achievement of significant company
milestones at the discretion of the board. Following a performance evaluation, the amount of possible bonus payable to each executive is
determined by the remuneration and nomination committee, taking into account factors including the accountabilities of the role and impact on
the company. There are no guaranteed base pay increases in any executives’ contracts.
Long-term incentives
Long-term incentives for executives and employees to deliver long-term shareholder returns are provided by a combination of equity plans that
may include:
an Employee Performance Rights Plan;
an Employee Share Plan ($1,000 Plan); and
an Employee Share Option Plan.
Participation in these plans is at the board’s discretion and no individual has a contractual right to participate in a plan or to receive any
guaranteed benefits.
Starpharma Employee Performance Rights Plan
In 2010 the board approved the introduction of the Starpharma Employee Performance Rights Plan (ASX code SPLAK). The objective of the
Plan is to assist in the recruitment, reward, retention and motivation of employees of the company. The Plan allows for the issue of performance
rights (being rights to receive fully paid ordinary shares subject to continued employment with the company and the satisfaction of certain
performance hurdles over a specified period). The key points of the Plan are:
All executives and staff and certain contractors may be invited to apply for Rights under the scheme.
One Right once vested is equivalent to one fully paid ordinary share.
Rights and the resultant shares are granted for no consideration.
Appropriate vesting conditions can be applied to each allocation. The standard vesting condition in the plan rules is continued employment for
two years.
At the end of the vesting period a further disposal restriction (Holding Lock) may be applied to restrict disposal of the resulting shares. The
standard Holding Lock in the plan rules is one year after vesting.
Rights will lapse on cessation of employment before the vesting date, except for good leaver and change of control provisions at the board’s
discretion.
In the event of a change of control of the company the board has the discretion to determine whether Rights will vest and become exercisable.
In making its decision, the board must consider:
(i) the portion of the Vesting Period elapsed; and
(ii) the extent to which the Performance Conditions (if any) have been met.
In the event of cessation due to death, illness, permanent disability, redundancy or any other circumstance approved by the board unvested
Rights will lapse, unless the board determines otherwise having regard to:
(i) the portion of the Vesting Period elapsed; and
(ii) the extent to which the Performance Conditions (if any) have been met.
The Holding Lock on the resulting shares will be automatically removed on cessation of employment.
Starpharma Employee Share Plan ($1,000 Plan)
All executives and staff, excluding directors, are eligible to participate in the Starpharma Employee Share Plan ($1,000 Plan). The objective of
the $1,000 Plan is to assist in the reward, retention and motivation of employees of the company. An annual allocation of up to $1,000 of shares
may be granted and taxed on a concessional basis. Shares are granted under the $1,000 Plan for no consideration and are escrowed for 3
years while participants are employed by the company.
Starpharma Employee Share Option Plan
Options are granted under the Starpharma Holdings Limited Employee Share Option Plan (ASX code SPLAM) which was approved by
shareholders at the 2007 annual general meeting. All executives and staff are eligible to participate in the Plan. The objective of the Plan is to
assist in the recruitment, reward, retention and motivation of employees of the company. Options are granted under the Plan for no
consideration. The exercise price of options granted under the Plan must be not less than the market price at the time the decision is made to
invite a participant to apply for options. The exercise price is usually calculated on the basis of 15% above market price. Market price is
calculated as the volume-weighted average price (VWAP) of the shares in the 15 days preceding the approval to grant the options.
Performance review and development
Executives and all other staff participate in a formal two stage performance review and development process consisting of an objectives
planning and development session at the commencement of the annual cycle and a performance and salary review towards the end of the
cycle. The objective of the salary review is to ensure that all employees are appropriately remunerated for their contribution to the company, that
remuneration is competitive within the relevant industry sector, and that increases in employees’ skills and responsibilities are recognised.
During the year an evaluation of all executives and other staff took place in accordance with this process.
Trading in company securities
The trading of shares issued to participants under any of the company’s employee equity plans is governed by the company’s securities trading
policy. Executives are prohibited from entering into any hedging arrangements over unvested securities. Further information regarding the
company’s securities trading policy is set out in Section 3.2 of the Corporate Governance Statement.
Use of remuneration consultants
If remuneration consultants are to be engaged to provide remuneration recommendations as defined in section 9B of the Corporations Act 2001,
they are to be engaged by, and report directly to, the remuneration & nomination committee. No remuneration consultants have been engaged
to provide such remuneration services during the financial year.
15
STARPHARMA HOLDINGS LIMITED
Voting and comments made at the company’s 2011 Annual General Meeting (AGM)
Of the votes cast on the company’s remuneration report for the 2011 financial year, 98% were in favour of the resolution. The company did not
receive any specific feedback at the AGM or throughout the year on its remuneration practices.
Performance of Starpharma Holdings Limited
The executive team of Starpharma achieved important milestones directly related to their key performance indicators in the year.
These included:
Commencement and full recruitment of the phase 2 BV prevention of recurrence clinical study of VivaGel®,
Securing FDA and European agreement on the clinical design protocols for the BV treatment phase 3 pivotal studies of VivaGel®;
Receiving FDA Special Protocol Assessment for BV treatment phase 3 clinical studies;
Commencement of the pivotal phase 3 VivaGel® clinical studies for BV treatment;
Expanded commercial collaborative partnerships in drug delivery and agrochemicals;
Raised $35 million in equity at no discount to market at the placement date; and
Elevated to the S&P/ASX300 index on Starpharma’s increasing share price and market capitalisation.
These key links between key management personnel performance and remuneration and Starpharma Holdings Limited’s long term performance
are evident in the appreciation in share price, with a compounded annual return over the past five years in excess of 30%.
Details of remuneration
The following tables show details of the remuneration received by the directors and the key management personnel of the group for the current
and previous financial year.
2012
Name
Short-term benefits
Post-
employment
Long-term
benefits
Share-based payments
Cash salary
& fees
$
Cash
bonus#
$
Non-monetary
benefits
$
Super-
annuation
$
Long service
leave
$
Shares#
$
Performance
Rights#
$
Non-executive directors
P T Bartels
120,000
R Dobinson
60,000
P J Jenkins
55,046
R A Hazleton
60,000
Z Peach1
P R Turvey2
41,284
–
Executive directors
–
–
–
–
–
–
–
–
–
–
–
–
–
–
4,954
–
3,716
17,097
–
–
–
–
–
–
J K Fairley
341,454
150,000
40,720
18,764
15,732
Other Key Management Personnel (group)
B P Rogers
89,496
10,399
5,108
J R Paull
176,847
30,000
11,640
C P Barrett
196,652
25,000
–
N J Baade
173,596
25,000
13,561
D J Owen
174,422
25,000
M L McColl
192,303
25,000
339
–
49,712
24,995
17,699
24,500
24,954
17,307
6,772
8,462
8,388
7,658
1,023
248
–
–
–
–
–
–
–
1,000
1,000
1,000
1,000
1,000
1,000
Total
$
120,000
60,000
60,000
60,000
45,000
17,097
–
–
–
–
–
–
128,540
695,210
23,008
185,495
28,760
281,704
28,760
277,499
28,760
274,075
28,760
255,498
28,760
264,618
Totals
1,681,100
290,399
71,368
203,698
48,283
6,000
295,348
2,596,196
1 Appointed 1 October 2011.
2 Appointed 19 March 2012.
# All performance related remuneration, including cash bonuses, shares, and performance rights granted are determined to be an ‘at risk’
component of total remuneration.
There were no retirement benefits paid in the current or prior year.
16
2011
Name
Short-term benefits
Post-
employment
Long-term
benefits
Share-based payments
ANNUAL REPORT 2012
Cash salary
& fees
$
Cash
bonus#
$
Non-monetary
benefits
$
Super-
annuation
$
Long service
leave
$
Options#
$
Shares#
$
Performance
Rights#
$
Total
$
Non-executive directors
P T Bartels
114,896
J W Raff1
11,773
R Dobinson
60,000
P J Jenkins
30,000
R A
Hazleton
60,000
Executive directors
–
–
–
–
–
–
–
–
–
–
5,104
46,060
–
30,000
–
–
–
–
–
–
J K Fairley
310,852
150,000
39,570
24,961
2,765
Other Key Management Personnel
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
120,000
57,833
60,000
60,000
60,000
164,904
693,052
B P Rogers
87,729
4,333
2,013
49,999
4,568
12,752
1,000
10,344
172,738
J R Paull
175,212
18,349
13,337
18,238
23,308
16,212
1,000
12,931
278,587
C P Barrett
189,524
18,349
–
18,708
1,733
16,212
1,000
12,931
258,457
N J Baade
159,473
18,349
12,643
22,228
2,200
15,668
1,000
12,931
244,492
D J Owen
161,926
18,349
528
24,945
4,487
15,668
1,000
12,931
239,834
M L McColl2
162,382
6,881
–
15,234
268
–
1,000
12,931
198,696
Totals
1,523,767
234,610
68,091
255,477
39,329
76,512
6,000
239,903 2,443,689
1 Resigned 17 June 2011.
2 Employed from 16 August 2010.
# All performance related remuneration, including cash bonuses, shares, performance rights and options granted are determined to be an ‘at
risk’ component of total remuneration.
There were no retirement benefits paid in the current or prior year.
Service Agreements
Remuneration and other terms of employment for the CEO and the executives are formalised in service agreements which include a formal
position description and set out duties, rights and responsibilities, and entitlements on termination. Each of these agreements provides that the
executive may receive performance-related cash bonuses, and other benefits including participation, when eligible, in the Starpharma Holdings
Employee Equity Plans. Other major provisions of the agreements relating to remuneration are set out below.
J K Fairley Chief Executive Officer
– No fixed term of agreement
– Base salary, inclusive of superannuation, per annum as at 30
June 2012 of $395,500, to be reviewed annually by the
remuneration and nomination committee.
– A cash bonus up to $150,000 for the year to 30 June 2012
allocated proportionately on the achievement of predetermined
objectives. For the financial year commencing 1 July 2012 the
maximum cash bonus is $200,000, subject to the achievement of
predetermined objectives.
– Fringe benefits consist of on-site car parking.
– Subject to termination at any time by:
(i) the Executive giving to the company twelve months’ notice in
writing; or
(ii) the company giving to the Executive six months’ notice in
writing. If the company gives notice in accordance with this
clause, the Executive will be entitled to a termination payment
upon the expiration of the notice period, of an amount equal to
6 months’ total remuneration.
– The Executive’s employment may be terminated by the company
at any time without notice if the Executive:
(i) is guilty of serious misconduct;
(ii) becomes unable to pay the Executive’s debts as they
become due; or
(iii) is found guilty by a court of a criminal offence.
B P Rogers Company Secretary
– No fixed term of agreement.
– Base salary, inclusive of superannuation, per annum as at 30
June 2012 of $139,633 part-time, to be reviewed annually by the
remuneration and nomination committee.
– Fringe benefits consist of on-site car parking.
– Payment of termination benefit on termination by the employer,
other than for serious breach of obligations to the employer,
wilful neglect of duty or serious misconduct, equal to thirteen
weeks gross remuneration.
17
STARPHARMA HOLDINGS LIMITED
J R Paull VP – Development and Regulatory Affairs
– No fixed term of agreement.
– Base salary, inclusive of superannuation, per annum as at 30
June 2012 of $213,632, to be reviewed annually by the
remuneration and nomination committee.
– Fringe benefits consist of on-site car parking.
– Subject to termination at any time by:
(i) the Executive giving to the company not less than three
months written notice; or
(ii) the company giving to the Executive written notice, or
payment in lieu of that notice, which notice period shall be six
months.
– The Executive’s employment may be terminated by the company
at any time without notice for serious breach of obligations to the
employer, wilful neglect of duty, serious misconduct or
bankruptcy.
C P Barrett VP – Business Development
– No fixed term of agreement.
– Base salary, inclusive of superannuation, per annum as at 30
June 2012 of $219,068, to be reviewed annually by the
remuneration and nomination committee.
– Subject to termination at any time by:
(i) the Executive giving to the company not less than two months
written notice; or
(ii) the company giving to the Executive written notice, or payment
in lieu of that notice, which notice period shall be four months.
– The Executive’s employment may be terminated by the company
at any time without notice for serious breach of obligations to the
employer, wilful neglect of duty, serious misconduct or
bankruptcy.
N J Baade Chief Financial Officer
– No fixed term of agreement.
– Base salary, inclusive of superannuation, per annum as at 30
June 2012 of $212,110, to be reviewed annually by the
remuneration and nomination committee.
– Fringe benefits consist of on-site car parking.
– Subject to termination at any time by:
(i) the Executive giving to the company not less than two months
written notice; or
Share-based compensation
Options
Options are granted under the Starpharma Holdings Limited
Employee Share Option Plan (ASX code SPLAM) (“the Plan”)
which was approved by shareholders at the 2007 annual general
meeting. All employees of the group are eligible to participate in
the plan. Options are granted under the plan for no consideration
and when exercised, enable the holder to subscribe for one fully
paid ordinary share of the company to be allotted not more than
ten business days after exercise, at the exercise price. The vesting
(ii) the company giving to the Executive written notice, or
payment in lieu of that notice, which notice period shall be four
months.
– The Executive’s employment may be terminated by the company
at any time without notice for serious breach of obligations to the
employer, wilful neglect of duty, serious misconduct or
bankruptcy.
D J Owen VP – Research
– No fixed term of agreement.
– Base salary, inclusive of superannuation, per annum as at 30
June 2012 of $204,712, to be reviewed annually by the
remuneration and nomination committee.
– Subject to termination at any time by:
(i) the Executive giving to the company not less than three
months written notice; or
(ii) the company giving to the Executive written notice, or
payment in lieu of that notice, which notice period shall be
three months.
– The Executive’s employment may be terminated by the company
at any time without notice for serious breach of obligations to the
employer, wilful neglect of duty, serious misconduct or
bankruptcy.
M L McColl VP – Business Development
– No fixed term of agreement.
– Base salary, inclusive of superannuation, per annum as at 30
June 2012 of $215,220, to be reviewed annually by the
remuneration and nomination committee.
– Subject to termination at any time by:
(i) the Executive giving to the company not less than three
months written notice; or
(ii) the company giving to the Executive written notice, or
payment in lieu of that notice, which notice period shall be
three months.
– The Executive’s employment may be terminated by the company
at any time without notice for serious breach of obligations to the
employer, wilful neglect of duty, serious misconduct or
bankruptcy.
period is 1 to 2 years from the date of grant, and the exercise
period is 2 to 3 years from the end of the vesting period.
There were no options granted in the current or prior year. The
terms and conditions of each grant of options affecting
remuneration of each director of the company and the key
management personnel of the group in this or future reporting
periods are as follows:
Grant date
Date exercisable
Expiry date
Exercise price
Value per option at
grant date
1 January 2009
29 August 2010
28 August 2012
29 June 2009
29 June 2011
28 June 2014
$0.29
$0.37
$0.11
$0.23
% vested
100%
100%
Options granted under the Plan carry no dividend or voting rights. The weighted average remaining contractual life of share options outstanding
at the end of the year was 1.54 years (2011: 2.42 years).
18
Fair value of options granted
There were no options granted in the current or prior year. For
earlier years, the fair value at grant date was independently
determined using a 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 the expected price
volatility of the underlying share, the expected dividend yield and
the risk free rate for the term of the option. The expected price
volatility is based on the historic volatility (based on the remaining
life of the options), adjusted for any expected changes to future
volatility due to publicly available information.
ANNUAL REPORT 2012
Shares issued to directors and key management personnel on the exercise of options
Details of ordinary shares issued to the key management personnel of the group on the exercise of options in the current and prior year were:
Number of shares issued on exercise of options
during the year
Intrinsic value1
$
Name
J K Fairley
B R Rogers
J R Paull
C P Barrett
N J Baade
D J Owen
2012
–
–
–
75,000
–
–
2011
350,000
100,000
350,000
175,000
300,000
200,000
2012
–
–
–
72,750
–
–
2011
74,775
22,500
82,250
60,125
128,000
60,500
1 The intrinsic value of each option exercised has been determined as opening share price on the date of allotment of shares less the option
exercise price.
The amount paid per ordinary share by the key management personnel of the group on the exercise of options were as follows:
Share allotment date on exercise of options
24 January 2012
No amounts are unpaid on any shares issued on the exercise of options.
Amount paid
per share
$0.29
Share options granted to directors and key management personnel
Details of options over unissued ordinary shares of Starpharma Holdings Limited provided as remuneration to any of the directors or the key
management personnel of the group with greatest authority as part of their remuneration were as follows:
Number of options
vested during the year
Number of options
expired during the year
Name
J K Fairley
B R Rogers
J R Paull
C P Barrett
N J Baade
D J Owen
2012
–
–
–
–
–
–
2011
–
200,000
275,000
275,000
225,000
225,000
2012
–
–
–
–
–
–
2011
300,000
100,000
–
200,000
–
–
The options were granted under the Starpharma Holdings Limited Employee Share Option Plan.
No options have been granted to directors or key management personnel in the current or prior year, or since the end of the year. No other
directors or key management personnel hold options under the Plan.
No options lapsed during the year as a result of performance milestones not being met.
19
STARPHARMA HOLDINGS LIMITED
Shares and Performance Rights
Details of ordinary shares and performance rights over unissued ordinary shares of Starpharma Holdings Limited provided as remuneration to
any of the directors or the key management personnel of the group with greatest authority as part of their remuneration were as follows:
Name
J K Fairley
B R Rogers
J R Paull
C P Barrett
N J Baade
D J Owen
M L McColl
Number of shares
granted during the year
Number of performance rights
granted during the year
2012
–
851
851
851
851
851
851
2011
–
1,190
1,190
1,190
1,190
1,190
1,190
2012
375,000
32,000
40,000
40,000
40,000
40,000
40,000
2011
–
65,000
80,000
80,000
80,000
80,000
80,000
Details of ordinary shares issued on the vesting of performance rights of Starpharma Holdings Limited provided as remuneration to any of the
directors or the key management personnel of the group with greatest authority as part of their remuneration were as follows:
Name
J K Fairley
Number of shares issued
on the vesting of performance
rights during the year
2012
–
2011
487,500
Number of
performance rights
lapsed during the year
2012
–
2011
262,500
No performance rights vested in the current year. The value at vesting date of performance rights that vested during 2011 was $407,062.
No other performance rights have vested or lapsed; and no other shares were issued on the vesting of performance rights in the current or prior
year provided as remuneration to any of the directors or the key management personnel of the group.
The terms and conditions of the grant of performance rights in the current year were as follows:
Grant date
Vesting Date
Holding Lock Expiry
date
Number of
Rights
Performance
Measure
Value per right
at grant date
% vested
10 November 2011 31 September 2012
31 September 2013
125,000
Share Price ≥ $1.50
10 November 2011 31 September 2012
31 September 2013
125,000
Share Price ≥ $2.00
10 November 2011 31 September 2012
31 September 2013
125,000
Achievement of KPIs
25 November 2011 25 November 2013
25 November 2014
467,500
Achievement of KPIs
$0.30
$0.12
$0.96
$1.09
Nil
Nil
Nil
Nil
Principles used to determine the nature and amount of remuneration and the relationship between remuneration and company performance are
set out in the Executive remuneration policy and framework section of this report.
20
Details of remuneration: cash bonuses, shares, performance rights and options
For each cash bonus and grant of equity included in the tables on pages 16 to 21, the percentage of the available bonus or grant that was paid,
or that vested, in the financial year, and the percentage that was forfeited because the person did not meet the service and individual
performance objectives is set out below. The options vest over the specified periods providing vesting criteria are met. No options or rights will
vest if the conditions are not satisfied, hence the minimum value of the options and rights yet to vest is nil. The maximum value of the options
and rights yet to vest has been determined as the amount of the grant date fair value of the options and rights that is yet to be expensed.
ANNUAL REPORT 2012
Cash bonus
Paid Forfeited
Grant date
value of
shares
granted during
20122
Grant date
value of rights
granted during
20122 3
Year Granted
Vested
Performance rights Remuneration
consisting
of shares,
options &
rights4
Financial years in
which rights
may vest
Forfeited
Name
J K
Fairley
B P
Rogers
J R
Paull
C P
Barrett
N J
Baade
D J
Owen
M L
McColl
%
100%
–1
–1
–1
–1
–1
–1
%
–
–
–
–
–
–
–
$
–
$
172,500
1,000
34,880
1,000
43,600
1,000
43,600
1,000
43,600
1,000
43,600
1,000
43,600
2012
2012
2011
2012
2011
2012
2011
2012
2011
2012
2011
2012
2011
%
%
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
30/06/2013
30/06/2014
30/06/2013
30/06/2014
30/06/2013
30/06/2014
30/06/2013
30/06/2014
30/06/2013
30/06/2014
30/06/2013
30/06/2014
30/06/2013
%
18%
13%
11%
11%
11%
12%
11%
1 The bonuses paid are at the absolute discretion of the board based on an individual’s performance within the year. There is no unpaid
component of the bonuses awarded.
2 The value at grant date calculated in accordance with AASB 2 Share-based Payments of shares and performance rights granted during the
year as part of remuneration.
3 The maximum value of options and performance rights is determined at grant date and is amortised over the applicable vesting period. The
amount which will be included in a given key management personnel’s remuneration for a given year is consistent with this amortisation amount.
No options or performance rights will vest if the conditions are not satisfied, hence the minimum value yet to vest is nil.
4 The percentage of the value of remuneration consisting of equity, based on the market value of shares at grant date, and the fair value of
options and performance rights expensed during the current year.
- End of remuneration report -
21
STARPHARMA HOLDINGS LIMITED
Shares under option
Unissued ordinary shares of Starpharma Holdings Limited under option at the date of this report are as follows:
Grant date
Expiry date
Issue price of shares
Number under options
29 June 2009
28 June 2014
$0.37
794,000
No option holder has any right under the options to participate in any other issue of the company or group.
Shares issued on the exercise of options
The following ordinary shares of Starpharma Holdings Limited were issued during the year to the date of this report on the exercise of options.
No amounts are unpaid on any of the shares.
Date options granted
Issue price of shares
(Option exercise price)
Number of shares issued
21 August 2007
31 October 2007
1 January 2009
29 June 2009
$0.43
$0.50
$0.29
$0.37
1,684,809
30,000
415,000
320,000
Shares under rights
Unissued ordinary shares of Starpharma Holdings Limited under the Employee Performance Rights Plan at the date of this report are as follows:
Grant date
Vesting date
Holding Lock date
Number of rights
granted
Balance of rights
at date of report
2 September 2010
31 August 2012
31 August 2013
10 November 2011
30 September 2012
30 September 2013
25 November 2011
25 November 2013
25 November 2014
830,800
375,000
467,500
717,800
375,000
457,500
Rights and the resultant shares are granted for no consideration.
Shares issued on the vesting of rights
The following ordinary shares of Starpharma Holdings Limited were issued during the year to the date of this report on the vesting of
performance rights granted under the Employee Performance Rights Plan. No amounts are unpaid on any of the shares.
Date rights granted
2 September 2010
Issue price of shares
(Exercise price of right)
Number of shares issued
$ -
13,000
Insurance of officers
During the financial year, Starpharma Holdings Limited arranged to
insure the directors and executive officers of the company and
related bodies corporate. The terms of the policy prohibit
disclosure of the amount of the premium paid. The liabilities
insured are legal costs that may be incurred in defending civil or
criminal proceedings that may be brought against the officers in
their capacity as officers of entities in the group, and any other
payments arising from liabilities incurred by the officers in
connection with such proceedings. This does not include such
liabilities that arise from conduct involving a wilful breach of duty
by the officers or the improper use by the officers of their position
or of information to gain advantage for themselves or someone
else or to cause detriment to the company. It is not possible to
apportion the premium between amounts relating to the insurance
against legal costs and those relating to other liabilities.
22
Audit & non audit services
The company may decide to employ the auditor on assignments
additional to their statutory audit duties where the auditor’s
expertise and experience with the company and/or the group are
important. Details of the amounts paid or payable to the auditor
(PricewaterhouseCoopers) for audit and non-audit services
provided during the year are set out below. The board of directors
has considered the position and, in accordance with the advice
received from the audit and risk committee is satisfied that the
provision of the non-audit services is compatible with the general
standard of independence for auditors imposed by the
Corporations Act 2001. The directors are satisfied that the
provision of non-audit services by the auditor, as set out below, did
ANNUAL REPORT 2012
not compromise the auditor independence requirements of the
Corporations Act 2001 for the following reasons:
– all non-audit services have been reviewed by the audit and risk
committee to ensure they do not impact the impartiality and
objectivity of the auditor
– none of the services undermine the general principles relating to
auditor independence as set out in APES 110 Code of Ethics for
Professional Accountants.
During the year the following fees were paid or payable for
services provided by the auditor (PricewaterhouseCoopers) of the
parent entity, its related practices and non-related audit firms.
Assurance Services
Audit or review of financial reports of the entity or any entity in the group under the
Corporations Act 2001
Other assurance services – Grant reviews & program audits
2012
$
85,000
-
2011
$
113,000
18,000
No taxation or advisory services have been provided by the auditor in either the current or prior year.
Auditors’ Independence Declaration
A copy of the auditors’ independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 24.
Rounding of amounts
The company is of a kind referred to in Class order 98/100, issued by the Australian Securities and Investments Commission, relating to the
‘’rounding off’’ of amounts in the directors’ report. Amounts in the directors’ report have been rounded off in accordance with that Class Order to
the nearest thousand dollars, or in certain cases, the nearest dollar.
Auditor
PricewaterhouseCoopers continues in office in accordance with section 327 of the Corporations Act 2001.
This report is made in accordance with a resolution of the Directors.
Peter T Bartels, AO
Director
Melbourne, 27 August 2012
23
STARPHARMA HOLDINGS LIMITED
Auditor’s independence declaration
Auditor’s Independence Declaration
Auditor’s Independence Declaration
As lead auditor for the audit
I declare that to the best of my knowledge and belief, there have been:
I declare that to the best of my knowledge and belief, there have been:
audit of Starpharma Holdings Limited for the
for the year ended 30 June 2012,
a)
no contraventions of the auditor independence requirements of the Corporations Act 2001
no contraventions of th
relation to the audit;
Corporations Act 2001 in
; and
b)
no contraventions of any applicable code of professional conduct in relation to the audit.
no contraventions of any applicable code of professional conduct in relation to the
no contraventions of any applicable code of professional conduct in relation to the
This declaration is in respect of Starpharma Holdings Limited and the entities it controlled
This declaration is in respect of
period.
and the entities it controlled during the
Anton Linschoten
Partner
PricewaterhouseCoopers
Melbourne
27 August 2012
PricewaterhouseCoopers, ABN 52
PricewaterhouseCoopers, ABN 52 780 433 757
Freshwater Place, 2 Southbank Boulevard, SOUTHBANK VIC 3006, GPO Box 1331, MELBOURNE VIC 3001
Freshwater Place, 2 Southbank Boulevard, SOUTHBANK VIC 3006, GPO Box 1331, MELBOURNE VIC 3001
Freshwater Place, 2 Southbank Boulevard, SOUTHBANK VIC 3006, GPO Box 1331, MELBOURNE VIC 3001
T: 61 3 8603 1000, F: 61 3 8603 1999, www.pwc.com.au
T: 61 3 8603 1000, F: 61 3 8603 1999,
Liability limited by a scheme approved under Professional Standards Legislation
Liability limited by a scheme approved under Pr
24
ANNUAL REPORT 2012
Corporate Governance Statement
Starpharma Holdings Limited (“the company”) and the board are
committed to achieving and demonstrating the highest standards
of corporate governance. The board guides and monitors the
company’s activities on behalf of the shareholders. In developing
policies and setting standards the board considers the Australian
Securities Exchange (“ASX”) Corporate Governance Principles
and Recommendations (2nd Edition with 2010 Amendments) (“the
CGC Recommendations”). The Corporate Governance Statement
set out below describes the company’s current corporate
governance principles and practices which the board considers to
comply with the CGC Recommendations. All of these practices,
unless otherwise stated, were in place for the entire year. This
corporate governance statement is available on the company’s
website. The company and its controlled entities together are
referred to as the group in this statement.
Principle 1: Lay solid foundations for management and oversight
The relationship between the board and senior management is
critical to the group’s long term success. The directors are
responsible to the shareholders for the performance of the group in
both the short and the longer term and seek to balance sometimes
competing objectives in the best interests of the group as a whole.
Their focus is to enhance the interests of shareholders and other
key stakeholders and to ensure the group is properly managed.
The responsibilities of the board are described in the board
charter, which is set out under Principle 2 below.
Principle 2: Structure the board to add value
The board operates in accordance with the broad principles of the
charter set out below.
2.1 Board charter
The charter of the board of Starpharma Holdings Limited, matters
reserved for the board and matters delegated to the CEO are set
out below.
2.1.1 Board Composition
– The board is to be composed of both executive and non-
executive directors with a majority of non-executive directors.
– In recognition of the importance of independent views and the
board’s role in supervising the activities of management the
Chairman must be an independent non-executive director, the
majority of the board must be independent of management and
all directors are required to bring independent judgement to bear
in their board decision making.
– The Chairman is elected by the full board and meets regularly
with the CEO.
– The board may decide to appoint one of the non-executive
directors as Deputy Chairman.
– The company is to maintain a mix of directors on the board from
different backgrounds with complementary skills and experience.
– The board is to undertake an annual board performance review
and consider the composition, structure, and role of the board
and individual responsibilities of directors.
– The minimum number of directors is three and the maximum is
fifteen unless the company passes a resolution varying that
number.
– There is no requirement for a director to hold shares in the
company.
2.1.2 Functions Reserved for the board
The company has established matters reserved for the board.
These are:
(a) Strategic Issues
– approving the company's corporate strategy;
– overseeing and monitoring organisational performance and the
achievement of the group’s strategic goals and objectives;
– approving any major transaction not included in the budget or
outside the ordinary course of the business;
– determining the structure of the company and the definition of
the business;
(b) Shareholding Items
– issuing shares, options or performance rights;
– granting special rights to shares;
– determining the amount of a dividend;
Day to day management of the group’s affairs and the
implementation of the corporate strategy and policy initiatives are
delegated by the board to the Chief Executive Officer (“CEO”).
These delegations are reviewed on an annual basis.
A performance assessment for senior executives was last
conducted in April 2012. The process for these assessments is
described in the Remuneration Report under the heading
“Performance Review and Development” on page 15 of this report.
(c) Financial Items
– approving the company's credit policy;
– reviewing and approving the annual budget and financial plans
including available resources and major capital expenditure
initiatives;
– seeking credit in excess of $50,000;
– giving any guarantee or letter of credit or any security over the
company's assets;
(d) Expenditure Items
– approval of the annual and half-year financial reports;
– approving expenditure exceeding $100,000, unless reimbursable
by an external funding body in which case the limit is $250,000;
– approving divestments of assets exceeding $50,000;
(e) Audit
– approving appointment or removal of external auditors;
– considering any external audit reports;
(f) Board and Senior Management
– establishing corporate governance policies;
– appointment, performance assessment and, if necessary,
removal of the CEO;
– determining remuneration of the CEO;
– ratifying the appointment and, if necessary, the removal of senior
executives;
2.1.3 Other Board Responsibilities
– enhancing and protecting the reputation of the group;
– overseeing the operation of the group, including its systems for
control, accountability, and risk management;
– monitoring financial performance;
– liaison with the company’s auditors;
– ensuring there are effective management processes in place and
approving major corporate initiatives; and
– reporting to shareholders.
2.2 Board members
Details of the members of the board, their experience,
qualifications, term of office and independent status are set out in
the directors’ report under the heading “Information on Directors”.
There are six non-executive directors, all of whom are deemed
independent under the principles set out below, and one executive
director at the date of signing the directors’ report. The board
seeks to ensure that:
– at any point in time, its membership represents an appropriate
balance between directors with experience and knowledge of the
group and directors with an external or fresh perspective; and
– the size of the board is conducive to effective discussion and
efficient decision-making.
25
STARPHARMA HOLDINGS LIMITED
2.3 Directors’ independence
The company has adopted specific principles for assessing the
independence of directors: To be deemed independent, a director
must be a non-executive and:
– not be a substantial shareholder of the company or an officer of,
or otherwise associated directly with, a substantial shareholder
of the company;
– within the last three years, not have been employed in an
executive capacity by the company, or been a director after
ceasing to hold any such employment;
– within the last three years, not have been a principal of a
material professional adviser or a material consultant to the
company, or an employee materially associated with the service
provided;
– not be a material supplier or customer of the company, or an
officer of or otherwise associated directly or indirectly with a
material supplier or customer;
– must have no material contractual relationship with the company
other than as a director; and
– be free from any interest and any business or other relationship
which could, or could reasonably be perceived to, materially
interfere with the director’s ability to act in the best interests of
the company.
Materiality for the purposes of applying these criteria is determined
on both quantitative and qualitative bases. An amount of 5% of the
individual director’s net worth is considered material, and in
addition a transaction of any amount or a relationship is deemed
material if knowledge of it may impact the shareholders’
understanding of the director’s performance. A substantial
shareholder for the purposes of applying these criteria is a person
with a substantial shareholding as defined in section 9 of the
Corporations Act 2001.
Under these criteria the board has determined that all non-
executive directors were independent at the date of this report.
2.4 Term of office
The company’s Constitution specifies that all non-executive
directors must retire from office no later than the third annual
general meeting following their last election, and that one third of
non-executive directors (or if their number is not a multiple of three
then the number nearest to one third) retire at every annual
general meeting and be eligible for re-election.
It is anticipated that non-executive directors would generally hold
office for up to ten years, and shall serve a maximum of fifteen
years from date of first election by shareholders. The board, on its
initiative and on an exceptional basis, may exercise discretion to
extend this maximum term where it considers that such an
extension would benefit the company.
2.5 Chairman and Chief Executive Officer (CEO)
The current Chairman Mr Peter Bartels is an independent non-
executive director appointed in 2003. The CEO Dr Jackie Fairley
was appointed as a director and CEO on 1 July 2006. The
Chairman is responsible for leading the board, ensuring directors
are properly briefed in all matters relevant to their role and
responsibilities, facilitating board discussions and managing the
board’s relationship with the company’s senior executives. The
board has established the functions delegated to the CEO. The
CEO is responsible for implementing company strategies and
policies, and for the day to day business operations of the group in
accordance with the strategic objectives of the group as approved
by the board from time to time.
The board policy is for these separate roles of Chairman and CEO
to be undertaken by separate people.
2.6 Commitment
The board held nine meetings during the year. Meetings are
usually held at the company’s corporate offices and laboratory
facility in the Baker IDI Building, 75 Commercial Road, Melbourne,
Australia. The number of meetings of the board and of each board
committee held during the year ended 30 June 2012, and the
number of meetings attended by each director is disclosed in the
Directors’ Report. The commitments of non-executive directors are
considered by the remuneration and nomination committee prior to
their appointment to the board and are reviewed each year as part
26
of the annual performance assessment. Prior to appointment or
being submitted for re-election each non-executive director is
required to specifically acknowledge that they have and will
continue to have the time available to discharge their
responsibilities to the company.
2.7 Conflict of interests
Directors are expected to avoid any action, position or interest that
may result in a conflict with an interest of the company. A director
who has a material personal interest in a matter that relates to the
affairs of the company must give notice of such interest and is
precluded from participating in discussions or decision making on
such dealings.
2.8 Independent professional advice
Directors and board committees have the right, in connection with
their duties and responsibilities, to seek independent professional
advice at the company’s expense. Prior approval of the Chairman
is required, but this approval will not be unreasonably withheld.
2.9 Performance assessment
The board undertakes an annual self-assessment of its
performance. Each director is asked to consider matters such as
composition, structure and role of the board, and performance of
individual directors. The Chairman then meets individually with
each director to discuss the assessment.
During the year an assessment of the board and its committees
was conducted in accordance with these procedures. Following
this assessment the two board committees were reconstituted on
14 May 2012, with a new Chair and two new members for each
committee.
The CEO’s performance is assessed taking into account
attainment of predetermined targets or goals based on various
financial and other measurable indicators related to the company.
The CEO meets with the remuneration and nomination committee
annually to discuss attainment of key performance indicators of
both the CEO and the senior management team.
2.10 Board committees
The board has established two committees to assist in the
execution of its duties and to allow detailed consideration of
complex issues. The committee structure and membership is
reviewed on an annual basis. Board committees are chaired by an
independent director other than the Chairman of the board. Where
applicable matters determined by committees are submitted to the
full board as recommendations for board decisions.
2.11 Remuneration and nomination committee
The company has established a remuneration and nomination
committee comprising of three independent non-executive
directors. At the date of this report the committee consisted of the
following:
Dr P J Jenkins (Chairman)
Mr P T Bartels
Ms Z Peach
Details of these directors’ attendance at committee meetings are
set out in the directors’ report on page 13.
The charter of the remuneration and nomination committee is to:
– conduct annual reviews of board membership having regard to
present and future needs of the company and make
recommendations on board composition and appointments;
– conduct an annual review of and conclude on the independence
of each director;
– propose candidates for board vacancies;
– oversee board succession including the succession of the
Chairman;
– oversee the annual assessment of board performance;
– advise the board on remuneration and incentive policies and
practices generally; and
– make specific recommendations on remuneration packages and
other terms of employment for executive directors, other senior
executives and non-executive directors.
When the need for a new director is identified or an existing
director is required to stand for re-election, the committee reviews
the range of skills, experience and expertise on the board,
identifies its needs and prepares a short-list of candidates with
appropriate skills and experience. Where necessary, advice is
sought from independent search consultants. The remuneration
and nomination committee’s terms of reference include
responsibility for reviewing any transaction between the
organisation and the directors, or any interests associated with the
directors, to ensure the structure and the terms of the transaction
are in compliance with the Corporations Act 2001 and are
appropriately disclosed.
ANNUAL REPORT 2012
Principle 3: Promote ethical and responsible decision making
3.1 Code of conduct
The directors are committed to the principles underpinning best
practice in corporate governance, with a commitment to the
highest standards of legislative compliance and financial and
ethical behaviour. The company has established a code of conduct
reflecting the core values of the company and setting out the
standards of ethical behaviour expected of directors, officers and
employees in all dealings and relationships including with
shareholders, contractors, customers and suppliers, and with the
company. Areas covered include employment practices, equal
opportunity, harassment and bullying, conflicts of interest, use of
company assets and disclosure of confidential information. The
code of conduct is available in the Corporate Governance section
of the company’s website.
3.2 Trading in company securities
The dealing in company securities by directors, executives and
employees is only permitted (subject also to complying with
applicable laws) during the following periods (trading windows):
• the period starting 24 hours after the release of Starpharma’s
annual results and ending on 31 December;
• the period starting 24 hours after the release of the Starpharma’s
half-year results and ending on 30 June; and
• such other period as determined by the Chairman or a
Committee of the board.
Notwithstanding the existence of these trading windows, the
company may notify Employees not to buy, sell or otherwise deal
in securities of the company during all or part of any trading
window. The other periods of the year are considered black-out
periods (or closed periods) during which time Employees must not
deal in securities of the company unless there are exceptional
circumstances and prior written permission from the “approving
officer” (Board, Chairman, CEO or Company Secretary, as
appropriate) is given.
An Employee who wishes to enter into a margin loan must obtain
written permission from the “approving officer” prior to entering into
the margin loan.
Except with prior written permission from the “approving officer”,
Employees may not enter into any transaction which would have
the effect of hedging or otherwise transferring to any other person
the risk of any fluctuation in the value of:
(a) securities in the company which are subject to a restriction on
disposal under an employee share or incentive plan; or
(b) options or performance rights (or any unvested securities in the
company underlying them).
The company’s share trading policy is discussed with each new
employee as part of their induction training.
The Securities Trading Policy approved by the Board of Directors
and released to the ASX on 16 December 2010, and is effective
from that date. The Securities Trading Policy is available in the
Corporate Governance section of the company’s website.
3.3 Diversity policy
The company is committed to workplace diversity, and the board
values the level of diversity already present within the organisation,
believing that continuing to promote diversity is in the best
interests of the company, its employees and its shareholders.
In June 2011 the board approved a Diversity Policy which operates
alongside the Code of Conduct and Anti-Discrimination, Bullying
and Harassment policies, providing a framework for Starpharma to
achieve a number of diversity objectives. The Diversity Policy is
available in the Corporate Governance section of the company’s
website.
In July 2011 the Starpharma board resolved to commence an
orderly renewal process to ensure the company maintained a mix
of directors on the board from different backgrounds with
complementary skills and experience. In October 2011 Ms Zita
Peach was appointed to the board as the first female non-
executive director. With five male non-executive directors and
CEO Dr Jackie Fairley also a director, total board membership
included 28% female directors at the date of this report.
Independent of external corporate governance initiatives the
company has embraced a culture of inclusion and equal
opportunity across diversity areas recognised as potentially
impacting upon equality in the workplace - gender, national origin,
culture, language, sexual orientation, disability and age.
A recent survey indicated that 50% of Starpharma employees were
born outside of Australia, representing 13 countries ranging from
El Salvador to Eritrea, Switzerland to Sudan, and China to
Romania. Almost two thirds of employees (64%) held a PhD or
equivalent qualification.
Board and Management believe that a culture of diversity has
helped the company to tap a deeper pool of talent and has
enhanced the collective skillset, contributing to the strong
performance of the business.
In accordance with the Diversity Policy the board has established
measurable objectives for achieving gender diversity and has
conducted an assessment of the objectives and progress in
achieving them. An excellent gender balance already exists across
the company and therefore the initial focus has been on the career
development of women rather than on increasing representation of
female employees.
Objectives set by the board for the 2011-2012 financial year, and
progress against these objectives are set out below:
Objective: Continue to measure and track gender diversity, and
continue to promote a corporate culture that embraces diversity
within the company and more widely within the biotech sector.
Progress towards objective: The company’s HR policies and
processes have been reviewed to ensure they are inclusive in
nature and consistent with the aims of the Diversity Policy.
A recent survey indicated more than half (57%) of current
employees were female, a slight increase on the female population
in July 2011 (53%). The table below sets out the proportion of
female employees in the whole organisation, in senior executive
positions and on the board, at July 2012.
Whole
organisation
Senior
Executive
positions
Total
Female
% female
35
20
57%
9
3
Board
7
2
33%
28%
Objective: Provide career development opportunities for women at
middle and senior management levels; encouraging and providing
opportunities for female networking and role models.
Progress towards objective: Five female middle managers (24% of
total female employees) attended at least one management
training course during the period July 2011 to June 2012. The
company supported all female staff participating in an industry
initiative “Connecting Women in Biotechnology” run by the
BioMelbourne Network industry group, and including presentations
by industry role models, during the 2011/2012 financial year.
27
STARPHARMA HOLDINGS LIMITED
Objective: Family friendliness –maintain initiatives to smooth
transitions before, during and after parental leave, and to retain
employees after they have taken parental leave.
Progress towards objective: Where possible, the company
provides flexible working hours and part time arrangements, and
Principle 4: Safeguard integrity in financial reporting
4.1 Audit and risk committee
The company has established an audit and risk committee
comprising three independent non-executive directors. At the date
of this report the committee consisted of the following:
Mr P R Turvey (Chairman)
Mr PT Bartels
Mr R A Hazleton
Details of these directors’ qualifications and attendance at
committee meetings are set out in the directors’ report pages 12 to
13. The audit and risk committee has appropriate financial
expertise and all members are financially literate and have an
appropriate understanding of the industry in which the group
operates. The committee meets at least twice a year, and has
direct access to the company’s auditors. The charter of this
committee is to:
– review and report to the board on the annual report, the half-year
financial report and all other financial information published by
the company or released to the market;
– assist the board in reviewing the effectiveness of the
organisation’s internal control environment covering:
> effectiveness and efficiency of operations,
> reliability of financial reporting, and
> compliance with applicable laws and regulations.
– oversee the effective operation of the risk management
framework by:
> ensuring the effective implementation of the risk
management policy and program,
> defining risk threshold levels for referral to the board,
> ensuring that an effective system of internal compliance
and control is in place,
> ensuring staff charged with risk management
responsibilities have appropriate authority to carry out their
functions and have appropriate access to the audit and risk
committee, and
> ensuring the allocation of sufficient resources for the
effective management of risk
– recommend to the board the appointment, removal and
remuneration of the external auditors, and review the terms of
their engagement, the scope and quality of the audit and assess
performance;
– consider the independence and competence of the external
auditor on an ongoing basis;
staff are encouraged to approach management to discuss their
particular needs before and after parental leave.
– review and monitor related party transactions and assess their
propriety;
– assist the board in the development and monitoring of statutory
compliance and ethics programs;
– provide assurance to the board that it is receiving adequate, up
to date and reliable information;
– report to the board on matters relevant to the committee’s role
and responsibilities.
In fulfilling its responsibilities, the audit and risk committee:
– receives regular reports from management and the external
auditors;
– reviews the processes the CEO and CFO have in place to
support their certifications to the board;
– reviews any significant disagreements between the auditors and
management, irrespective of whether they have been resolved;
– meets separately with the external auditors at least twice a year
without the presence of management;
– provides the external auditors with a clear line of direct
communication at any time to either the Chairman of the
committee or the Chairman of the board.
The audit and risk committee has authority, within the scope of its
responsibilities, to seek any information it requires from any
employee or external party.
4.2 External auditors
The company’s policy is to appoint external auditors who clearly
demonstrate quality and independence. The performance of the
external auditor is reviewed annually. The current auditors are
PricewaterhouseCoopers who have been the external auditors of
the company since it commenced operations. It is
PricewaterhouseCoopers policy to rotate audit engagement
partners on listed companies at least every five years, and the
current audit engagement partner assumed responsibility for the
conduct of the audit in 2010. An analysis of fees paid to the
external auditors, including a break-down of fees for non-audit
services, is provided in note 18 to the financial statements. It is the
policy of the external auditors to provide an annual declaration of
their independence to the audit and risk committee. The external
auditor is requested to attend the annual general meeting and be
available to answer shareholder questions about the conduct of
the audit and the preparation and content of the audit report.
Principle 5 and 6: Make timely and balanced disclosures and respect the rights of shareholders
5.1. Continuous disclosure and shareholder communication
The company has developed a continuous disclosure and
shareholder communication policy to ensure compliance with the
ASX Listing Rules and to facilitate effective communication with
shareholders. A copy of this policy is available on the company’s
website.
The board has appointed the Company Secretary as the person
responsible for disclosure of information to the ASX. This role
includes responsibility for ensuring compliance with the continuous
disclosure requirements of the ASX Listing Rules and overseeing
and co-ordinating information disclosure to the ASX, analysts,
brokers, shareholders, the media and the public. Procedures have
Principle 7: Recognise and manage risk
7.1. Risk assessment and management
The board, through the audit and risk committee, is responsible for
ensuring there are adequate policies in relation to risk
management, compliance and internal control systems. The
company operates in a challenging and dynamic environment, and
risk management is viewed as integral to realising new
opportunities as well as identifying issues that may have an
28
been established for reviewing whether there is any price sensitive
information that should be disclosed to the market, or whether any
price sensitive information may have been inadvertently disclosed.
All ASX announcements are posted on the company’s website as
soon as practicable after release to the ASX. The website also has
an option for shareholders to register their email address for direct
email updates on company matters.
All ASX announcements are also posted on the OTCQX website
(www.otcqx.com) in order to provide timely disclosure to US
investors trading in the company’s Level One ADRs
(OTCQX:SPHRY).
adverse effect on the company’s existing operations and its
sustainability. The company is committed to a proactive approach
towards risk management throughout its entire business
operations. The board aims to ensure that effective risk
management practices become embedded in the company culture
and in the way activities are carried out at all levels in the
company. The board and Management recognise the importance
that risk management plays in ensuring the business is able to fully
capitalise on the opportunities available to it as well as mitigating
potential loss. Health and Safety are considered to be of
paramount importance and are the focus of significant risk
management activities within the company. Other risk areas that
are addressed include business continuity and disaster recovery,
reputation, intellectual property, product development and clinical
trials. Adherence to the Code of Conduct is required at all times
and the board actively promotes a culture of quality and integrity.
The board has required management to design and implement a
risk management and internal control system to manage the
group’s material business risks. The risk management policy,
which is available on the company website, sets out policies for the
oversight of material business risks, and describes the
responsibilities and authorities of the board, the audit and risk
committee, the CEO, CFO, Company Secretary, and the senior
management team.
The CEO, CFO and Company Secretary are responsible to the
board through the audit and risk committee for the overall
implementation of the risk management program. During the
financial year management has reported to the board as to the
effectiveness of the group’s management of its material risks.
Principle 8: Remunerate fairly and responsibly
The company has established a remuneration and nomination
committee comprising of three independent non-executive
directors. Details regarding composition, meetings and charter are
set out in section 2.11 of this Corporate Governance Statement.
Each member of the senior executive team has signed a formal
employment contract covering a range of matters including their
duties, rights, responsibilities and any entitlements on termination.
Each contract refers to a specific formal position description which
is reviewed by the committee as necessary in consultation with the
CEO and relevant executive. Further information on directors’ and
ANNUAL REPORT 2012
7.2. Corporate reporting
The company prepares audited financial statements for each year
ending 30 June, and reviewed financial statements for each half
year period ending 31 December. In accordance with ASX Listing
Requirements the annual financial statements are lodged with the
ASX by 31 August, and half year statements are lodged with the
ASX by 28 February each year.
The CEO and the CFO have made the following certifications to
the board for the year ended 30 June 2012:
– that the company’s financial reports are complete and present a
true and fair view, in all material respects, of the financial condition
and operational results of the company and group and are in
accordance with relevant accounting standards; and
– that the above statement is founded on a sound system of risk
management and internal compliance and control which
implements the policies adopted by the board and that the
company’s risk management and internal compliance and control
is operating efficiently and effectively in all material respects in
relation to financial reporting risks.
executives’ remuneration, including principles used to determine
remuneration, is set out in the Remuneration Report on pages 14
to 21.
The company’s policy on prohibiting entering into transactions in
associated products which limit the economic risk of participating
in unvested entitlements under equity-based remuneration
schemes is contained in the Securities Dealing Policy which is
available in the Corporate Governance section of the company’s
website.
29
STARPHARMA HOLDINGS LIMITED
Annual Financial Report
Contents
Financial statements
Consolidated income statement
Consolidated statement of comprehensive income
Consolidated balance sheet
Consolidated statement of changes in equity
Consolidated statement of cash flows
Notes to the consolidated financial statements
Directors’ declaration
Independent audit report to the members
31
32
33
34
35
36
68
69
These financial statements are the consolidated financial statements for the consolidated entity consisting of Starpharma Holdings Limited and
its subsidiaries. The financial statements are presented in the Australian currency.
Starpharma Holdings Limited is a company limited by shares, incorporated and domiciled in Australia.
Its registered office and principal place of business is:
Starpharma Holdings Limited
Baker IDI Building, 75 Commercial Road
Melbourne, Victoria, 3004, Australia
A description of the nature of the group’s operations and its principal activities is included in the CEO’s Report on pages 3 to 7 and in the review
of operations in the directors’ report on pages 9 to 10, which are not part of this financial report.
The financial statements were authorised for issue by the directors on 27 August 2012. The directors have the power to amend and reissue the
financial report.
Through the use of the internet, Starpharma ensures that corporate reporting is timely and complete. All recent press releases, financial reports
and other information are available on the website: www.starpharma.com.
30
Consolidated income statement
For the year ended 30 June 2012
Revenue from continuing operations
Other income
Administration expense
Research and development expense
Finance costs
Loss before income tax
Income tax expense
Loss from continuing operations attributable to members of
Starpharma Holdings Limited
Loss per share for loss from continuing operations attributable to
the ordinary equity holders of the company
Basic loss per share
Diluted loss per share
Notes
5
5
6
6
7
24
24
The above consolidated income statement should be read in conjunction with the accompanying notes.
ANNUAL REPORT 2012
2012
$'000
2,744
160
(4,466)
(12,088)
(8)
(13,658)
Consolidated
2011
$'000
2,125
1,178
(6,231)
(5,986)
(16)
(8,930)
-
-
(13,658)
(8,930)
$
($0.05)
($0.05)
$
($0.04)
($0.04)
31
STARPHARMA HOLDINGS LIMITED
Consolidated statement of comprehensive income
For the year ended 30 June 2012
Loss for the year
Notes
Other comprehensive income (loss)
Foreign exchange differences on translation of foreign operations
15
Other comprehensive income (loss)
2012
$'000
(13,658)
421
421
Consolidated
2011
$'000
(8,930)
(2,284)
(2,284)
Total comprehensive income (loss) for the year attributable to
members of Starpharma Holdings Limited
(13,237)
(11,214)
The above statement of consolidated comprehensive income should be read in conjunction with the accompanying notes.
32
Consolidated balance sheet
As at 30 June 2012
Current Assets
Cash and cash equivalents
Trade and other receivables
Total current assets
Non-current assets
Property, plant and equipment
Intangible assets
Total non-current assets
Total assets
Current Liabilities
Trade and other payables
Borrowings
Provisions (employee entitlements)
Deferred income
Total current liabilities
Non-current liabilities
Borrowings
Provisions (employee entitlements)
Total non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Reserves
Accumulated losses
Total equity
ANNUAL REPORT 2012
Consolidated
2011
$'000
18,918
1,023
19,941
280
9,586
9,866
29,807
1,227
49
416
349
2,041
2012
$'000
42,812
2,053
44,865
414
8,989
9,403
54,268
4,492
40
506
397
5,435
Notes
8
9
10
11
12
13
13
100
17
82
182
5,617
48,651
139,171
1,866
(92,386)
48,651
14
15
16
56
73
2,114
27,693
105,399
1,022
(78,728)
27,693
33
The above consolidated balance sheet should be read in conjunction with the accompanying notes.
STARPHARMA HOLDINGS LIMITED
Consolidated statement of changes in equity
For the year ended 30 June 2012
Balance at 30 June 2012
139,171
1,866
(92,386)
48,651
Balance at 1 July 2011
Loss for the year
Other comprehensive income
Foreign exchange differences on translation of
foreign operations
Total comprehensive income (loss) for the
year
Transactions with owners, recorded directly
in equity
Contributions of equity, net of transaction costs
Employee share plans
Employee performance rights plan
Total transactions with owners
15
14
14
15
For the year ended 30 June 2011
Balance at 1 July 2010
Loss for the year
Other comprehensive income
Foreign exchange differences on translation of
foreign operations
Total comprehensive income (loss) for the
year
Transactions with owners, recorded directly
in equity
Contributions of equity, net of transaction costs
Employee share options plan
Employee share plans
Employee performance rights plan
Total transactions with owners
15
14
15
14
15
Notes
Contributed
capital
$'000
105,399
Reserves
Accumulated
losses
Consolidated
Total
equity
$'000
27,693
(13,658)
$'000
(78,728)
(13,658)
-
421
(13,658)
(13,237)
-
-
-
-
33,746
26
423
34,195
Consolidated
Total
equity
$'000
34,844
(8,930)
$'000
(69,798)
(8,930)
-
(2,284)
(8,930)
(11,214)
-
-
-
-
-
3,609
139
24
291
4,063
$'000
1,022
-
421
421
-
-
423
423
$'000
2,876
-
(2,284)
(2,284)
-
139
-
291
430
-
-
-
33,746
26
-
33,772
-
-
-
3,609
-
24
-
3,633
Notes
Contributed
capital
$'000
101,766
Reserves
Accumulated
losses
Balance at 30 June 2011
105,399
1.022
(78,728)
27,693
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
34
Consolidated statement of cash flows
For the year ended 30 June 2012
Notes
Cash flow from operating activities
Receipts from trade and other debtors (inclusive of GST)
Grant income (inclusive of GST)
Payments to suppliers and employees (inclusive of GST)
Interest received
Interest paid
Net cash outflows from operating activities
23
Cash flow from investing activities
Payments for property, plant and equipment
Net cash outflows from investing activities
Cash flow from financing activities
Proceeds from issue of shares
Share issue transaction costs
Lease repayments
Net cash inflows from financing activities
Net increase (decrease) in cash and cash equivalents held
Cash and cash equivalents at the beginning of the year
Effects of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at the end of the year
ANNUAL REPORT 2012
2012
$'000
1,141
405
(12,916)
1,608
(8)
(9,770)
Consolidated
2011
$'000
1,391
829
(9,793)
1,113
(16)
(6,476)
(133)
(138)
(133)
(138)
35,167
3,609
(1,422)
(80)
33,665
23,762
18,918
132
42,812
-
(101)
3,508
(3,106)
22,851
(827)
18,918
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
35
STARPHARMA HOLDINGS LIMITED
Notes to the consolidated financial statements
30 June 2012
Contents
1.
Summary of significant accounting policies
2.
3.
4.
5.
6.
7.
8.
9.
Financial risk management
Critical accounting estimates and judgments
Segment information
Revenue and other income
Expenses
Income tax expense
Current assets – Cash and cash equivalents
Current assets – Trade and other receivables
10.
Non-current assets – Property, plant and equipment
11.
Non-current assets – Intangible assets
12.
Current liabilities – Trade and other payables
13.
Current and non-current liabilities – Borrowings
14.
Contributed equity
15.
Reserves
16.
Accumulated losses
17.
Key management personnel disclosures
18.
Remuneration of auditors
19.
Contingencies
20.
Commitments
21.
Subsidiaries
22.
Events occurring after the balance sheet date
23.
Reconciliation of profit after income tax to net cash inflow from operating activities
24.
Earnings per share
25.
Share-based payments
26.
Related party transactions
27.
Parent entity financial information
36
37
42
43
44
44
45
45
47
48
49
50
51
51
51
54
54
55
59
60
60
61
61
62
62
62
66
67
1. Summary of significant accounting policies
The principal accounting policies adopted in the preparation of
these consolidated financial statements are set out below. These
policies have been consistently applied to all the years presented,
unless otherwise stated. The financial statements are for the
consolidated entity consisting of Starpharma Holdings Limited and
its subsidiaries.
(a) Basis of preparation
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. Starpharma Holdings
Limited is a for-profit entity for the purpose of preparing the
financial statements.
(i) Compliance with IFRS
The consolidated financial statements of the Starpharma Holdings
Limited group also comply with International Financial Reporting
Standards (IFRS) as issued by the International Accounting
Standards Board (IASB).
(ii) New and amended standards adopted by the group
None of the new standards and amendments to standards that are
mandatory for the first time for the financial year beginning 1 July
2011 affected any of the amounts recognised in the current period
or any prior period and is not likely to affect future periods.
(iii) Early adoption of standards
The group has not elected to apply any pronouncements before
their operative date in the annual reporting period beginning
1 July 2011.
(iv) Historical cost convention
These financial statements have been prepared under the
historical cost convention.
(v) Critical accounting estimates
The preparation of financial statements requires the use of certain
critical accounting estimates. It also requires management to
exercise its judgement in the process of applying the group’s
accounting policies. The areas involving a higher degree of
judgement or complexity, or areas where assumptions and
estimates are significant to the financial statements are disclosed
in note 3.
For the year ended 30 June 2012, the consolidated entity has
incurred losses of $13,658,000 (2011: $8,930,000) and
experienced net cash outflows of $9,770,000 from operations
(2011: $6,476,000), as disclosed in the balance sheet and
statement of cash flows, respectively. This is consistent with the
consolidated entity’s strategic plans and budget estimates, and the
directors are satisfied regarding the availability of working capital
for the period up to at least August 2013. Accordingly the directors
have prepared the financial report on a going concern basis in the
belief that the consolidated entity will realise its assets and settle
its liabilities and commitments in the normal course of business
and for at least the amounts stated in the financial report.
(b) Principles of consolidation
(i) Subsidiaries
The consolidated financial statements incorporate the assets and
liabilities of all subsidiaries of Starpharma Holdings Limited
(“company” or “parent entity”) as at 30 June 2012 and the results
of all subsidiaries for the year then ended. Starpharma Holdings
Limited and its subsidiaries together are referred to in this financial
report as the group or the consolidated entity.
Subsidiaries are all those entities (including special purpose
entities) over which the group has power to govern the financial
and operating policies, generally accompanying a shareholding of
more than one-half of the voting rights. The existence and effect of
potential voting rights that are currently exercisable or convertible
ANNUAL REPORT 2012
are considered when assessing whether the group controls
another entity.
Subsidiaries are fully consolidated from the date on which control
is transferred to the group. They are de-consolidated from the date
that control ceases.
Intercompany transactions, balances and unrealised gains on
transactions between group companies 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 group.
Investments in subsidiaries are accounted for at cost in the
separate financial statements of Starpharma Holdings Limited.
(c) Segment reporting
Operating segments are reported in a manner consistent with the
internal reporting provided to the chief operating decision maker.
The chief operating decision maker, who is responsible for
allocating resources and assessing performance of the operating
segments, has been identified as the Chief Executive Officer.
(d) Foreign currency translation
(i) Functional and presentation currency
Items included in the financial statements of each of the group’s
entities are measured using the currency of the primary economic
environment in which the entity operates (‘the functional currency’).
The consolidated financial statements are presented in Australian
dollars, which is Starpharma Holdings Limited’s functional and
presentation currency.
(ii) Transactions and balances
Foreign currency transactions are translated into the functional
currency using the exchange rates prevailing at the dates of the
transactions. Foreign exchange gains and losses resulting from
the settlement of such transactions and from the translation at
year-end exchange rates of monetary assets and liabilities
denominated in foreign currencies are recognised in profit or loss.
Foreign exchange gains and losses that relate to borrowings are
presented in the income statement, within finance costs. All other
foreign exchange gains and losses are presented in the income
statement on a net basis within other income or other expenses.
(iii) Group companies
The results and financial position of all the group entities (none of
which has the currency of a hyperinflationary economy) that have
a functional currency different from the presentation currency are
translated into the presentation currency as follows:
assets and liabilities for each balance sheet presented are
translated at the closing rate at the date of that balance
sheet;
income and expenses for each income statement and
statement of comprehensive income are translated at
average exchange rates (unless this is not a reasonable
approximation of the cumulative effect of the rates prevailing
on the transaction dates, in which case income and expenses
are translated at the dates of the transactions); and
all resulting exchange differences are recognised in other
comprehensive income.
On consolidation, exchange differences arising from the translation
of any net investment in foreign entities, and of borrowings and
other financial instruments designated as hedges of such
investments, are recognised in other comprehensive income.
Goodwill and fair value adjustments arising on the acquisition of a
foreign entity are treated as assets and liabilities of the foreign
operation and translated at the closing rate.
37
STARPHARMA HOLDINGS LIMITED
(e) Revenue recognition
Revenue is measured at the fair value of the consideration
received or receivable. Amounts disclosed as revenue are net of
returns, trade allowances and amounts collected on behalf of third
parties. Licence revenue is recognised in accordance with the
underlying agreement. Upfront payments are brought to account
as revenues unless there is a correlation to ongoing research and
both components are viewed as one agreement, in which case the
licence income is amortised over the anticipated period of the
associated research program. Unamortised licence revenue is
recognised on the balance sheet as deferred income. Interest
revenue is recognised on a time proportion basis using the
effective interest rate method. All revenue is stated net of the
amount of Goods and Services Tax (GST).
(f) Government Grants
Government grants include contract income awarded by
government bodies for research and development projects. Grants
from the government are recognised at their fair value where there
is a reasonable assurance that the grant will be received and the
group will comply with all attached conditions. Government grants
relating to costs are deferred and recognised in profit or loss over
the period necessary to match them with the costs that they are
intended to compensate. Government grants relating to the
purchase of property, plant and equipment are included in non-
current liabilities as deferred income and are credited to the
income statement on a straight-line basis over the expected lives
of the related assets.
(g) 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. Deferred tax
assets and liabilities are recognised for temporary differences at
the tax rates expected to apply when the assets are recovered or
liabilities are settled, based on those tax rates which are enacted
or substantively enacted for each jurisdiction. The relevant tax
rates are applied to the cumulative amounts of deductible and
taxable temporary differences to measure the deferred tax asset or
liability. An exception is made for certain temporary differences
arising from the initial recognition of an asset or a liability. No
deferred tax asset or liability is recognised in relation to these
temporary differences if they arose in a transaction, other than a
business combination, that at the time of the transaction did not
affect either accounting profit or taxable profit or loss. Deferred tax
assets are recognised for deductible temporary differences and
unused tax losses only if it is probable that future taxable amounts
will be available to utilise those temporary differences and losses.
Deferred tax liabilities and assets are not recognised for temporary
differences between the carrying amount and tax bases of
investments in controlled entities where the parent entity is able to
control the timing of the reversal of the temporary differences and
it is probable that the differences will not reverse in the foreseeable
future. Current and deferred tax balances attributable to amounts
recognised directly in other comprehensive income or equity are
also recognised directly in other comprehensive income or equity,
respectively. Starpharma Holdings Limited and its wholly-owned
Australian controlled entities have not implemented the tax
consolidation legislation.
(h) Leases
Leases of property, plant and equipment where the group has
substantially all the risks and rewards of ownership are classified
as finance leases (note 20). Finance leases are capitalised at the
lease’s inception at the lower of the fair value of the leased
property, or if lower the present value of the minimum lease
payments. The corresponding rental obligations, net of finance
charges, are included in short-term and long term payables. Each
lease payment is allocated between the liability and finance cost.
The finance cost is charged to profit or loss over the lease period
so as to produce a constant periodic rate of interest on the
remaining balance of the liability for each period. The property,
plant and equipment acquired under finance leases is depreciated
over the asset’s useful life or over the shorter of the asset’s useful
life and the lease term if there is no reasonable certainty that the
38
group will obtain ownership at the end of the lease term. Leases in
which a significant portion of the risks and rewards of ownership
are not transferred to the group as lessee are classified as
operating leases (note 20). Payments made under operating
leases (net of any incentives received from the lessor) are charged
to profit or loss on a straight-line basis over the period of the lease.
Lease income from operating leases where the group is a lessor is
recognised in income on a straight-line basis over the lease term.
(i) Impairment of assets
Goodwill and intangible assets that have an indefinite life are not
subject to amortisation and are tested annually for impairment or
more frequently if events or changes in circumstances indicate that
they might be impaired. Other assets are tested for impairment
whenever events or changes in circumstance indicate that the
carrying amount may not be recoverable. An impairment loss is
recognised for the amount by which the asset’s carrying amount
exceeds its recoverable amount. The recoverable amount is the
higher of an asset’s fair value less costs to sell and value in use.
For the purposes of assessing impairment, assets are grouped at
the lowest levels for which there are separately identifiable cash
inflows which are largely independent of the cash inflows from
other assets or groups of assets (cash generating units).
(j) Cash and cash equivalents
For the purpose of presentation in the statement of cash flows,
cash and cash equivalents include cash on hand, deposits held at
call with financial institutions and other short-term, highly liquid
investments with original maturities of seven months or less that
are readily convertible to known amounts of cash and which are
subject to an insignificant risk of changes in value. The amount of
significant cash and cash equivalents not available for use is
disclosed in note 8.
(k) Trade Receivables
Trade receivables are recognised initially at fair value and
subsequently measured at amortised cost using the effective
interest method, less provision for impairment. Trade receivables
are generally due for settlement within 30 days. They are
presented as current assets unless collection is not expected for
more than 12 months after reporting date. Collectibility of trade
receivables is reviewed on an ongoing basis. Debts which are
known to be uncollectible are written off by reducing the carrying
amount directly. An allowance account (provision for impairment of
trade receivables) is used when there is objective evidence that
the group will not be able to collect all amounts due according to
the original terms of the receivables. Significant financial difficulties
of the debtor, probability that the debtor will enter bankruptcy or
financial reorganisation, and default or delinquency in payments
(more than 30 days overdue) are considered indicators that the
trade receivable is impaired. The amount of the impairment
allowance is the difference between the asset’s carrying amount
and the present value of estimated future cash flows, discounted at
the original effective interest rate. Cash flows relating to short-term
receivables are not discounted if the effect of discounting is
immaterial. The amount of the impairment loss is recognised in
profit or loss within administration expenses. When a trade
receivable for which an impairment allowance had been
recognised becomes uncollectible in a subsequent period, it is
written off against the allowance account. Subsequent recoveries
of amounts previously written off are credited against other
expenses in profit or loss.
(l) Investments and other financial assets
Classification
The group classifies its financial assets in the following categories:
financial assets at fair value through profit or loss, loans and
receivables, held-to-maturity investments and available-for-sale
financial assets. The classification depends on the purpose for
which the investments were acquired. Management determines
the classification of its investments at initial recognition and, in the
case of assets classified as held-to-maturity, re-evaluates this
designation at each reporting period.
(i) Loans and receivables
Loans and receivables are non-derivative financial assets with
fixed or determinable payments that are not quoted in an active
market. They are included in current assets, except for those with
maturities greater than 12 months after the reporting date which
are classified as non-current assets. Loans and receivables are
included in trade and other receivables (note 9) in the balance
sheet.
(m) Property, Plant and Equipment
Property, plant and equipment is stated at historical cost less
depreciation. Historical cost includes expenditure that is directly
attributable to the acquisition of the items. Subsequent costs are
included in the asset’s carrying amount or recognised as a
separate asset, as appropriate, only when it is probable that future
economic benefits associated with the item will flow to the group
and the cost of the item can be measured reliably. The carrying
amount of any component accounted for as a separate asset is
derecognised when replaced. All other repairs and maintenance
are charged to profit or loss during the financial period in which
they are incurred. Depreciation is calculated using the straight-line
method to allocate their cost or revalued amounts, net of the
residual values, over their estimated useful lives. The expected
useful lives are 3 to 15 years. The assets’ residual values and
useful lives are reviewed, and adjusted if appropriate, at each
balance sheet date. An asset’s carrying amount is written down
immediately to its recoverable amount if the asset’s carrying
amount is greater than its estimated recoverable amount (note 1
(i)). Gains and losses on disposals are determined by comparing
proceeds with the carrying amount. These are included in profit or
loss.
(n) Leasehold improvements
The cost of improvements to or on leasehold properties is
amortised over the unexpired period of the lease or the estimated
useful life of the improvement to the group between 1 to 3 years,
whichever is shorter.
(o) Intangible Assets
(i) Goodwill
Goodwill represents the excess of the cost of an acquisition over
the fair value of the group’s share of the net identifiable assets of
the acquired subsidiary/associate at the date of acquisition.
Goodwill on acquisitions of subsidiaries is included in intangible
assets. Goodwill is not amortised. Instead, goodwill is tested for
impairment annually, or more frequently if events or changes in
circumstances indicate that it might be impaired, and is carried at
cost less accumulated impairment losses. Gains and losses on the
disposal of an entity include the carrying amount of goodwill
relating to the entity sold. Goodwill is allocated to cash-generating
units for the purpose of impairment testing. The allocation is made
to those cash-generating units or groups of cash-generating units
that are expected to benefit from the business combination in
which goodwill arose, identified according to operating segments
(note 4).
(ii) Patents and licences
Costs associated with patents are charged to profit or loss in the
periods in which they are incurred. Licences and acquired patents
with a finite useful life are carried at cost less accumulated
amortisation and impairment losses. Amortisation is calculated
using the straight-line method to allocate the cost of licences and
patents over the period of the expected benefit, which varies from
3 to 14 years.
(iii) Research and development
Expenditure on research activities, undertaken with the prospect of
obtaining new scientific or technical knowledge and understanding,
is recognised in profit or loss as an expense when it is incurred.
Costs incurred on development activities (relating to the
application of research findings or other knowledge to a plan or
design for the production of new or substantially improved
products or services) before the start of commercial production or
use are recognised as intangible assets when it is probable that
the project will, after considering its technically and commercially
feasible and adequate resources are available to complete
ANNUAL REPORT 2012
development, generate future economic benefits and its costs can
be measured reliably. The expenditure capitalised comprises all
directly attributable costs, including costs of materials, services,
direct labour and an appropriate proportion of overheads. Other
development expenditure is recognised in profit or loss as an
expense as incurred. To date no development costs have been
capitalised.
(p) Trade and other payables
These amounts represent liabilities for goods and services
provided to the group prior to the end of the financial year which
are unpaid. The amounts are unsecured and are usually paid
within 30 to 45 days of recognition. Trade and other payables are
presented as current liabilities unless payment is not due within 12
months from the reporting date.
(q) Borrowings
Borrowings are initially recognised at fair value, net of transaction
costs incurred. Borrowings are subsequently measured at
amortised cost. Any difference between the proceeds (net of
transaction costs) and the redemption amount is recognised in
profit or loss over the period of the borrowings using the effective
interest method. Borrowings are classified as current liabilities
unless the group has an unconditional right to defer settlement of
the liability for at least 12 months after the reporting period.
(r) Provisions
Provisions for legal claims, service claims and make good
obligations are recognised when the group has a present legal or
constructive obligation as a result of past events, it is more
probable than not that an outflow of resources will be required to
settle the obligation and the amount has been reliably estimated.
Provisions are not recognised for future operating losses. Where
there are a number of similar obligations, the likelihood that an
outflow will be required in settlement is determined by considering
the class of obligations as a whole. A provision is recognised even
if the likelihood of an outflow with respect to any one item in the
same class of obligations may be small. Provisions are measured
at the present value of management’s best estimate for the
expenditure required to settle the present obligation at the balance
date. The discount rate used to determine the present value
reflects current market assessment of the time, value of money,
and the risks specific to liability. The increase of the provision due
to the passage of time is recognised as interest expense.
(s) Employee benefits
(i) Wages and salaries and annual leave
Liabilities for wages and salaries, including non-monetary benefits,
and annual leave expected to be settled within 12 months after the
end of the period in which the employees render the related
service are recognised in respect of employees’ services up to the
period and are measured at the amounts expected to be paid
when the liabilities are settled. The liability for annual leave and
accumulating sick leave is recognised in the provision for
employee benefits. All other short-term employee benefit
obligations are presented as payables.
(ii) Other long-term employee benefit obligations
The liability for long service leave and annual leave which is not
expected to be settled within 12 months after the end of the period
in which the employees render the related services is recognised
in the provision for employee benefits and measured as the
present value of expected future payments to be made in respect
of services provided by employees up to the end of the reporting
period using the projected unit credit method. Consideration is
given to expected future wage and salary levels, experience of
employee departures and periods of service. Expected future
payments are discounted using market yields at the end of the
reporting period on national government bonds with terms to
maturity and currency that match, as closely as possible, the
estimated future cash outflows. The obligations are presented as
current liabilities in the balance sheet if the entity does not have an
unconditional right to defer settlements for at least twelve months
after the reporting date, regardless of when the actual settlements
is expected to occur.
39
STARPHARMA HOLDINGS LIMITED
(iii) Superannuation and Pension Benefits
Group companies make the statutory superannuation guarantee
contribution in respect of each employee to their nominated
complying superannuation or pension fund. In certain
circumstances pursuant to an employee’s employment contract the
group companies may also be required to make additional
superannuation or pension contributions and/or agree to make
salary sacrifice superannuation or pension contributions in addition
to the statutory guarantee contribution. The group’s legal or
constructive obligation is limited to the above contributions.
Contributions to the employees’ superannuation or pension plans
are recognised as an expense as they become payable. Prepaid
contributions are recognised as an asset to the extent that a cash
refund or reduction in future payments is available.
(iv) Employee benefits on-costs
Employee benefit on-costs, including payroll tax, are recognised
and included in other payables and costs when the employee
benefits to which they relate are recognised as liabilities.
(v) Share-based payments
Share-based compensation benefits are offered to the directors
and employees via the Starpharma Holdings Limited Employee
Share Option Plan (“SPLAM”), an Employee Share Plan ($1,000
Plan), and an Employee Performance Rights Plan. Information
relating to these plans is set out in note 25 and in the remuneration
report under the directors’ report.
The fair value of options and performance rights granted is
recognised as an employee benefit expense with a corresponding
increase in equity. The fair value is measured at grant date and
recognised over the period during which the employees become
unconditionally entitled to the options or rights The fair value at
grant date is determined using a Black-Scholes or binomial model
(or variant of, as appropriate) that takes into account any exercise
price, the term, the vesting and performance criteria, the impact of
dilution, the non-tradeable nature of the option or share right, 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. The fair value excludes the impact of any
non-market vesting conditions (for example, profitability and sales
growth targets). Non-market vesting conditions are included in
assumptions about the number of options or share rights that are
expected to become exercisable. At each balance sheet date, the
entity revises its estimate of the number of options or share rights
that are expected to become exercisable. The employee benefit
expense recognised in each period takes into account the most
recent estimate. The impact of the revision to original estimates, if
any, is recognised in the income statement with a corresponding
adjustment to equity.
Under the Employee Share Plan ($1,000 Plan) shares are issued
to employees for no cash consideration and vest immediately on
grant. On this date, the market value of the shares issued is
recognised as an employee benefits expense with a corresponding
increase in equity.
(vi) Bonus payments
The group recognises a liability and an expense for bonuses
based on a formula that takes into consideration performance
criteria that has been set. The group recognises a provision where
contractually obliged or where there is a past practice that has
created a constructive obligation.
(vii) Termination benefits
Termination benefits are payable when employment is terminated
before the normal retirement date, or when an employee accepts
voluntary redundancy in exchange for these benefits. The group
recognises termination benefits when it is demonstrably committed
to either terminating the employment of current employees
according to a detailed formal plan without possibility of withdrawal
or providing termination benefits as a result of an offer made to
encourage voluntary redundancy. Benefits falling due more than
12 months after the end of the reporting period are discounted to
present value.
40
(t) Contributed equity
Ordinary shares are classified as equity. Incremental costs directly
attributable to the issue of new shares, performance rights or
options are shown in equity as a deduction, net of tax, from the
proceeds. Incremental costs directly attributable to the issue of
new shares or options, for the acquisition of a business, are not
included in the cost of the acquisition as part of the purchase
consideration.
(u) Dividends
Provision is made for the amount of any dividend declared, being
appropriately authorised and no longer at the discretion of the
entity, on or before the end of the reporting period but not
distributed at the end of the reporting period.
(v) Earnings per share
(i) Basic earnings per share
Basic earnings per share is calculated by dividing the profit
attributable to owners of the company, excluding any costs of
servicing equity other than ordinary shares, by the weighted
average number of ordinary shares outstanding during the
financial year, adjusted for bonus elements in ordinary shares
issued during the year and excluding treasury shares.
(ii) Diluted earnings per share
Diluted earnings per share adjusts the figures used in the
determination of basic earnings per share to take into account the
after income tax effect of interest and other financing costs
associated with dilutive potential ordinary shares and the weighted
average number of additional ordinary shares that would have
been outstanding assuming the conversion of all dilutive potential
ordinary shares.
(w) Goods and Services Tax (“GST”)
Revenues, expenses and assets are recognised net of the amount
of associated GST, unless the GST incurred is not recoverable
from the taxation authority. In this case it is recognised as part of
the cost of acquisition of the asset or as part of the expense.
Receivables and payables are stated inclusive of the amount of
GST receivable from, or payable to, the taxation authority is
included with other receivables or payables in the balance sheet.
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 flows.
(x) Rounding of amounts
The company is of a kind referred to in Class order 98/100, issued
by the Australian Securities and Investments Commission, relating
to the ‘’rounding off’’ of amounts in the financial statements.
Amounts in the financial statements have been rounded off in
accordance with that Class Order to the nearest thousand dollars,
or in certain cases, the nearest dollar.
(y) New accounting standards and interpretations
Certain new accounting standards and interpretations have been
published that are not mandatory for 30 June 2012 reporting
periods. The group’s assessment of the impact of these new
standards and interpretations is set out below.
(i) AASB 9 Financial Instruments, AASB 2009-11 Amendments to
Australian Accounting Standards arising from AASB 9 and AASB
2010-7 Amendments to Australian Accounting Standards arising
from AASB 9 (December 2010) (effective from 1 January 2013*)
AASB 9 Financial Instruments addresses the classification,
measurement and derecognition of financial assets and financial
liabilities. The standard is not applicable until 1 January 2013* but
is available for early adoption. When adopted, the standard will
affect in particular the group’s accounting for its available-for-sale
financial assets, since AASB 9 only permits the recognition of fair
value gains and losses in other comprehensive income if they
relate to equity investments that are not held for trading. Fair value
gains and losses on available-for-sale debt investments, for
example, will therefore have to be recognised directly in profit or
loss. There will be no impact on the group’s accounting for
financial liabilities, as the new requirements only affect the
accounting for financial liabilities that are designated at fair value
through profit or loss and the group does not have any such
liabilities. The derecognition rules have been transferred from
AASB 139 Financial Instruments: Recognition and Measurement
and have not been changed. The group has not yet decided when
to adopt AASB 9.
* In December 2011, the IASB delayed the application date of
IFRS 9 to 1 January 2015. The AASB is expected to make an
equivalent amendment to AASB 9 shortly.
(ii) AASB 10 Consolidated Financial Statements, AASB 11 Joint
Arrangements, AASB 12 Disclosure of Interests in Other Entities,
revised AASB 127 Separate Financial Statements and AASB 128
Investments in Associates and Joint Ventures and AASB 2011-7
Amendments to Australian Accounting Standards arising from the
Consolidation and Joint Arrangements Standards (effective 1
January 2013)
In August 2011, the AASB issued a suite of five new and amended
standards which address the accounting for joint arrangements,
consolidated financial statements and associated disclosures.
AASB 10 replaces all of the guidance on control and consolidation
in AASB 127 Consolidated and Separate Financial Statements,
and Interpretation 12 Consolidation – Special Purpose Entities.
The core principle that a consolidated entity presents a parent and
its subsidiaries as if they are a single economic entity remains
unchanged, as do the mechanics of consolidation. However, the
standard introduces a single definition of control that applies to all
entities. It focuses on the need to have both power and rights or
exposure to variable returns. Power is the current ability to direct
the activities that significantly influence returns. Returns must vary
and can be positive, negative or both. Control exists when the
investor can use its power to affect the amount of its returns. There
is also new guidance on participating and protective rights and on
agent/principal relationships.
AASB 11 introduces a principles based approach to accounting for
joint arrangements. The focus is no longer on the legal structure of
joint arrangements, but rather on how rights and obligations are
shared by the parties to the joint arrangement. Based on the
assessment of rights and obligations, a joint arrangement will be
classified as either a joint operation or a joint venture. Joint
ventures are accounted for using the equity method, and the
choice to proportionately consolidate will no longer be permitted.
Parties to a joint operation will account their share of revenues,
expenses, assets and liabilities in much the same way as under
the previous standard. AASB 11 also provides guidance for parties
that participate in joint arrangements but do not share joint control.
AASB 12 sets out the required disclosures for entities reporting
under the two new standards, AASB 10 and AASB 11, and
replaces the disclosure requirements currently found in AASB 127
and AASB 128.
ANNUAL REPORT 2012
Amendments to AASB 128 provide clarification that an entity
continues to apply the equity method and does not remeasure its
retained interest as part of ownership changes where a joint
venture becomes an associate, and vice versa. The amendments
also introduce a “partial disposal” concept.
The amendments are not expected to have any impact on the
group’s financial statements.
(iii) AASB 13 Fair Value Measurement and AASB 2011-8
Amendments to Australian Accounting Standards arising from
AASB 13 (effective 1 January 2013)
AASB 13 was released in September 2011. It explains how to
measure fair value and aims to enhance fair value disclosures.
The group has yet to determine which, if any, of its current
measurement techniques will have to change as a result of the
new guidance. It is therefore not possible to state the impact, if
any, of the new rules on any of the amounts recognised in the
financial statements. However, application of the new standard will
impact the type of information disclosed in the notes to the
financial statements. The group does not intend to adopt the new
standard before its operative date, which means that it would be
first applied in the annual reporting period ending 30 June 2014.
There are no other standards that are not yet effective and that are
expected to have a material impact on the entity in the current or
future reporting periods and on foreseeable future transactions.
(z) Parent entity financial information
The financial information for the parent entity, Starpharma
Holdings Limited, disclosed in note 27 has been prepared on the
same basis as the consolidated financial statements, except as set
out below.
(i) Investments in subsidiaries, associates and joint venture entities
Investments in subsidiaries, associates and joint venture entities
are accounted for at cost in the financial statements of Starpharma
Holdings Limited. Dividends received from associates are
recognised in the parent entity’s profit or loss, rather than being
deducted from the carrying amount of these investments.
(ii) Share-based payments
The grant by the company of options and rights over its equity
instruments to the employees of subsidiary undertakings in the
group is treated as a capital contribution to that subsidiary
undertaking. The fair value of employee services received,
measured by reference to the grant date fair value, is recognised
over the vesting period as an increase to investment in subsidiary
undertakings, with a corresponding credit to equity.
41
STARPHARMA HOLDINGS LIMITED
2. Financial risk management
The group’s activities expose it to a variety of financial risks;
including market risk, credit risk and liquidity risk. The group’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 group. The chief
executive officer, chief financial officer and company secretary,
under the guidance of the audit and risk committee and the board,
have responsibility for the risk management program.
(a) Market risk
(i) Foreign Exchange Risk
Foreign exchange risk arises when future commercial transactions
and recognised assets and liabilities are denominated in a
currency that is not the entity’s functional currency. The group
operates internationally and is exposed to foreign exchange risk
arising from currency exposures to major currencies including the
US dollar.
On the basis of the nature of these transactions, the group does
not use derivative financial instruments to hedge such exposures,
but maintains cash and deposits in both Australian and US dollars.
The directors are regularly monitoring the potential impact of
movements in foreign exchange exposure.
The exposure to foreign currency risk at the reporting date was
as follows:
Cash and cash equivalents
Trade and other receivables
Trade and other payables
Deferred Income
Group Sensitivity
2012
US
$’000
3,059
10
3,969
306
Consolidated
2011
US
$’000
3,492
517
534
297
The group is mainly exposed to US dollars. The following table details the group’s sensitivity to a 10% increase and decrease in the Australian
dollar against the US dollar. A positive number indicates a favourable movement; that is an increase in profit or reduction in the loss.
Impact on profit / (loss) on a movement of the US Dollar:
Australian dollar strengthens (increases) against the US Dollar by 10%
Australian dollar weakens (decreases) against the US Dollar by 10%
2012
$’000
(131)
108
(ii) Cash Flow Interest Rate Risk
The group hold interest bearing assets and therefore the income and operating cash flows are exposed to market interest rates.
At the end of the reporting period, the group had the following at call and short term deposits maturing in of 90 to 212 days.
Term Deposits and deposits at call
Group Sensitivity
2012
$’000
41,357
Consolidated
2011
$’000
(269)
329
Consolidated
2011
$’000
16,819
At 30 June 2012, if interest rates had changed by 50 basis points
either higher or lower from the year end rates with all other
variables held constant, group profit for the year would have been
$209,000 higher or lower (2011 - change of 50 bps: $269,000
higher/lower) due to either higher or lower interest income from
cash or cash equivalents.
(b) Credit risk
Credit risk is managed on a group basis. Credit risk arises from
cash and cash equivalents and deposits with banks and financial
institutions, as well as credit exposures from royalty and licensing
agreements and product sales. Credit risk for cash and deposits
with banks and financial institutions is managed by maximising
42
deposits held under major Australian and US banks. Other than
government funded research and development programs, third
party receivables largely consist of research fees, royalty and
licensing receivables from leading, multinational organisations.
(c) Liquidity risk
Prudent liquidity risk management implies maintaining sufficient
cash and marketable securities. The directors regularly monitor the
cash position of the group, giving consideration to the level of
expenditure and future capital commitments entered into.
(d) Fair value estimation
The fair value of financial assets and financial liabilities must be
estimated for recognition and measurement for disclosure
purposes. The fair value of financial instruments traded in active
markets (such as publicly traded derivatives, and trading and
available-for-sale securities) is based on quoted market prices at
the reporting date. The quoted market price used for financial
assets held by the group is the current bid price. The fair value of
financial instruments that are not traded in an active market (for
example, over-the-counter derivatives and investments in unlisted
3. Critical accounting estimates and judgments
Estimates and judgments 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.
(a) Critical accounting estimates and assumptions
The group makes estimates and assumptions concerning the
future. The resulting accounting estimates will, by definition,
seldom equal the related actual results. The estimates and
assumptions that have a significant risk of causing material
adjustment to the carrying amounts of assets and liabilities within
the next financial year are discussed below.
i) Amortisation of finite life intangible assets
The group’s management determines the estimated life of the
patents underlying the core technology of the business and
calculates amortisation accordingly. The estimate is based on the
period of expected benefit which currently stands at 3–14 years.
This could change as a result of technical innovations or
competitor actions in response to severe industry cycles.
Management will increase amortisation charges when the useful
lives are less than their previously estimated lives. The carrying
value of intangible assets at 30 June 2012 is $8,989,000 (2011:
$9,586,000).
ii) Impairment of Goodwill
The group tests annually whether goodwill has suffered any
impairment. In accordance with the accounting policy stated in
notes 1(i) and 1(o). Impairment of goodwill is considered based on
the fair value less cost to sell of the cash generating units over
which the goodwill is allocated. Performing the assessment of fair
value less costs to sell requires the use of assumptions. Refer to
note 11 for details of these assumptions.
iii) Income Taxes
The group is subject to income taxes in Australia and the United
States of America. There are transactions and calculations
ANNUAL REPORT 2012
subsidiaries) is determined using valuation techniques. The group
uses a variety of methods and makes assumptions that are based
on market conditions existing at each balance date. Quoted market
prices or dealer quotes for similar instruments are used for long-
term debt instruments held. Other techniques, such as estimated
discounted cash flows, are used to determine fair value for the
remaining financial instruments. The fair value of interest rate
swaps is calculated as the present value of the estimated future
cash flows. The fair value of forward exchange contracts is
determined using forward exchange market rates at the reporting
date. The carrying value less impairment provision of trade
receivables and payables are assumed to approximate their fair
values due to their short-term nature. The fair value of financial
liabilities for disclosure purposes is estimated by discounting the
future contractual cash flows at the current market interest rate
that is available to the group for similar financial instruments.
undertaken during the ordinary course of business for which the
ultimate tax determination may be uncertain. Where the final tax
outcome of these matters is different from the amounts that were
initially recorded, such differences will impact the current and
deferred tax provisions in the period in which such determination is
made. The group has recognised deferred tax assets or liabilities,
including carried forward losses, not bought to account on the due
to the realisation of such benefits as uncertain. The utilisation of
tax losses also depends on the ability of the entity to satisfy certain
tests at the time the losses are recouped. The group is assessing
whether to consolidate for Australian tax purposes from 1 July
2011. The determination has not been made, thus the disclosures
remains consistent with prior periods, that the group is not
consolidated for tax.
iv) R&D Tax Incentives
The group research and development activities are eligible under
an Australian Government tax incentive for eligible expenditure
from 1 July 2011. Management has assessed these activities and
expenditure to determine which are likely to be eligible under the
incentive scheme. For the period to 30 June 2012 the group has
recorded a contra research and development expense of
$1,323,000.
(b) Critical accounting judgments in applying accounting
policies
i) Impairment of Assets
The group follows the guidance of AASB 136 on determining when
an investment is other-than-temporarily impaired. This
determination requires significant judgment. In making these
judgments, the group evaluates, among other factors, the duration
and extent to which the fair value of an investment is less than its
cost and the financial health of the near-term business outlook for
the investee. This includes factors such as industry performance,
changes in technology, operating and financing cash flow and
recent transactions involving equity instruments.
43
STARPHARMA HOLDINGS LIMITED
4. Segment information
Management has determined the operating segments based on
separate reportable segments to the Chief Executive Officer, who
is the chief operating decision maker. There are two reportable
segments within the group, with companies operating across two
jurisdictions - in Australia and United States of America (“USA”).
Dendritic Nanotechnologies Inc. (“DNT”) is domiciled in the USA
and on the basis of internal reporting and monitoring of the USA
operations, it has been determined as a reportable segment. The
principal activities of the group consist of development and
commercialisation of dendrimer products for pharmaceutical, life-
science and other applications.
Reportable segments
2012
Revenue and other income
Expenses
Australia
$’000
3,190
(15,795)
USA
$’000
187
(1,234)
Inter-segment
Eliminations
$’000
(473)
467
Total
$’000
2,904
(16,562)
Loss before income tax
(12,605)
(1,047)
(6)
(13,658)
Segment net assets
45,793
3,018
(160)
48,651
2011
Revenue and other income
Expenses
Australia
$’000
3,192
(10,772)
USA
$’000
659
(2,073)
Loss before income tax
(7,580)
(1,414)
Segment net assets
24,096
3,815
Inter-segment
Eliminations
$’000
(548)
612
64
(218)
Total
$’000
3,303
(12,233)
(8,930)
27,693
Sales between segments are carried out at arm's length and are eliminated upon consolidation. The revenue from external parties reported to
the board is measured in a manner consistent with that in the income statement.
5. Revenue and other income
Revenue and other income
Royalty, customer & licence revenue
Interest revenue
Other revenue
Total revenue
Australian Government grants
USA Government grants
Total other income
Total revenue and other income
2012
$’000
881
1,819
44
2,744
5
155
160
2,904
Consolidated
2011
$’000
1,121
981
23
2,125
92
1,086
1,178
3,303
Total revenue and other income for the year was $2,904,000, a reduction of $399,000 from the previous year, on lower grant income from the
US National Institutes of Health. The decrease in grant funding is partly offset by higher interest revenue earned on cash deposits.
44
6. Expenses
Loss from continuing operations before income tax expense includes
the following items:
R&D Tax Incentive (contra expense)
Depreciation
Amortisation
Rental expense on operating leases
Defined contribution superannuation expense
7. Income tax expense
(a) Income tax expense/(credit)
Current Tax
Deferred Tax
Income tax expense is attributable to:
Profit from continuing operations
Profit from discontinued operations
Aggregate income tax credit
Deferred income tax credit (revenue) / expense included in income
tax credit comprises:
(Decrease) in deferred tax liabilities
2012
$’000
(1,323)
134
1,008
329
385
2012
$’000
–
–
–
–
–
–
–
–
ANNUAL REPORT 2012
Consolidated
2011
$’000
–
172
1,360
285
426
Consolidated
2011
$’000
–
–
–
–
–
–
–
–
45
STARPHARMA HOLDINGS LIMITED
(b) Numerical reconciliation to income tax credit prima facie tax
payable
Loss from continuing operations before
income tax
Tax at the Australian tax rate of 30% (2011: 30%)
Tax effect of amounts which are not deductible (taxable) in calculating
taxable income
Eligible expenses claimed under R&D tax incentive
Amortisation of intangibles
Share-based payments
Unearned income
Sundry items
Difference in overseas tax rates
Previously unrecognised tax losses now recouped to reduce current
tax expense
Future income tax benefits not brought to account
Income tax credit
(c) Tax losses
Unused tax losses for which no deferred tax asset has been
recognised (as recovery is currently not probable)
Potential tax benefit
(d) Unrecognised temporary differences
Temporary differences for which no deferred tax asset has been
recognised as recoverability is not probable
Unrecognised deferred tax relating to the temporary differences
(13,658)
(4,097)
485
206
134
(102)
91
24
57
3,202
–
78,690
23,817
5,610
1,720
(8,930)
(2,679)
–
–
136
–
–
51
–
2,492
–
67,575
20,445
1,140
342
Potential future income tax benefits attributable to tax losses
carried forward have not been brought to account at 30 June 2012
because the directors do not believe that it is appropriate to regard
realisation of the future income tax benefit as probable. Similarly,
future benefits attributable to net temporary differences have not
been brought to account as the directors do not regard the
realisation of such benefits as probable.
Realisation of the benefit of tax losses would be subject to the
group satisfying the conditions for deductibility imposed by tax
legislation and no subsequent changes in tax legislation adversely
affecting the group. The group is making an assessment as to the
satisfaction of deductibility conditions at 30 June 2012 which it
believes will be satisfied.
46
8. Current assets – Cash and cash equivalents
Cash at bank and on hand
Deposits at call
ANNUAL REPORT 2012
2012
$’000
1,455
41,357
42,812
Consolidated
2011
$’000
2,099
16,819
18,918
Cash at bank and on hand
The cash is bearing floating interest rates based on current bank rates.
Deposits at call
The deposits are bearing floating interest rates ranging from 0.05% to 5.97% (2011: 0.05% to 6.19%). These deposits are at call up to 212 day
maturities.
Cash not available
There is $300,000 of cash not available for use due to restrictions associated with a finance lease and credit card facility which is guaranteed by
term deposits (2011: $186,000).
Interest rate risk
With the exception of loans to controlled entities, current receivables are non-interest bearing.
30 June 2012
Floating
Interest
rate
Fixed interest maturing
Notes
$’000
1 year
or
less
$’000
1 to 2
years
$’000
2 to 3
years
$’000
3 to 4
years
$’000
4 to 5
years
$’000
More
than 5
years
$’000
Non-
interest
bearing
$’000
Contractual
cash
flows
Total
$’000
Financial Assets
Cash and
deposits
Receivables
8
9
Weighted average
interest rate
Financial Liabilities
Payables
and provisions
Borrowings
12
13
Deferred income
Weighted average
interest rate
1,608
40,135
–
–
1,608
40,135
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1,069
42,812
N/A
2,053
2,053
2,053
3,122
44,865
2,053
2.7%
5.3%
–%
–%
–%
–%
–%
–%
–
–
–
–
–
40
–
40
–
25
–
25
–
27
–
27
–
30
–
30
–
18
–
18
–
–
–
–
5,080
5,080
5,080
–
397
140
397
140
397
5,477
5,617
5,617
–%
9.0%
8.2%
8.2%
8.2%
8.2%
–%
–%
47
STARPHARMA HOLDINGS LIMITED
30 June 2011
Floating
Interest
rate
Fixed interest maturing
Notes
$’000
1 year
or
less
$’000
1 to 2
years
$’000
2 to 3
years
$’000
3 to 4
years
$’000
4 to 5
years
$’000
More
than 5
years
$’000
Non-
interest
bearing
$’000
Contractual
cash
flows
Total
$’000
Financial Assets
Cash and
deposits
Receivables
8
9
Weighted average
interest rate
Financial Liabilities
Payables
and provisions
Borrowings
12
13
Deferred income
Weighted average
interest rate
1,584
15,858
–
–
1,584
15,858
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1,476
18,918
N/A
1,023
1,023
1,023
2,499
19,941
1,023
3.6%
5.5%
–%
–%
–%
–%
–%
–%
–
–
–
–
–
66
–
66
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1,699
1,699
1,699
–
349
66
349
66
349
2,048
2,114
2,114
–%
10.1%
–%
–%
–%
–%
–%
–%
9. Current assets – Trade and other receivables
2012
$’000
1,436
393
136
88
2,053
Consolidated
2011
$’000
604
183
153
83
1,023
Impaired receivables
As at 30 June 2012, there were no trade and grant receivables that
were past due (2011: $80,000). No receivables are considered
impaired at 30 June 2012 (2011: nil) other than from subsidiaries
within the group.
Other receivables
Other receivables comprise sundry debtors and GST claimable
and are subject to normal terms of settlement within 30 to 90 days.
Trade and grant receivables
Interest receivables
Prepayments
Other receivables
Trade and grant receivables
Trade receivables primarily comprise of revenue associated with
research and development projects and are subject to normal
terms of settlement within 30 to 90 days. Grant receivables
comprise of expenditure reimbursable under grants from the
Australian and Victorian Governments, including the R&D tax
incentive.
Credit risk
The group considers that there is no significant concentration of
credit risk with respect to current receivables. Grant receivables
are with government bodies and trade receivables are from large,
well respected companies. Loans to controlled entities are
assessed for recoverability and provisions are applied as
considered appropriate.
48
10. Non-current assets – Property, plant and equipment
ANNUAL REPORT 2012
Consolidated
At 30 June 2010
Cost
Accumulated depreciation and amortisation
Net book amount
Year ended 30 June 2011
Opening net book amount
Exchange differences
Additions
Disposals
Depreciation and amortisation
Closing net book amount
At 30 June 2011
Cost
Accumulated depreciation and amortisation
Net book amount
Year ended 30 June 2012
Opening net book amount
Additions
Disposals
Depreciation and amortisation
Closing net book amount
At 30 June 2012
Cost
Accumulated depreciation and amortisation
Net book amount
Plant and Equipment
$’000
Leasehold
improvements
$’000
Plant and Equipment
under finance lease
$’000
Total Plant and
Equipment
$’000
2,246
(2,108)
138
138
(2)
102
(7)
(61)
170
2,042
(1,872)
170
170
131
(12)
(54)
235
2,138
(1,903)
235
1,141
(1,136)
5
5
–
44
–
(11)
38
1,185
(1,147)
38
38
2
–
(18)
22
1,187
(1,165)
22
614
(538)
76
76
–
96
–
(100)
72
272
(200)
72
72
147
–
(62)
157
419
(262)
157
4,001
(3,782)
219
219
(2)
242
(7)
(172)
280
3,499
(3,219)
280
280
280
(12)
(134)
414
3,744
(3,330)
414
49
STARPHARMA HOLDINGS LIMITED
11. Non-current assets – Intangible assets
Consolidated
At 30 June 2010
Cost
Accumulated depreciation and amortisation
Net book amount
Year ended 30 June 2011
Opening net book amount
Exchange differences
Depreciation and amortisation
Closing net book amount
At 30 June 2011
Cost
Accumulated depreciation and amortisation
Net book amount
Year ended 30 June 2012
Opening net book amount
Exchange differences
Depreciation and amortisation
Closing net book amount
At 30 June 2012
Cost
Accumulated depreciation and amortisation
Net book amount
Patents & Licences
$’000
Goodwill
$’000
Total Intangibles
$’000
17,578
(6,207)
11,371
11,371
(1,812)
(1,360)
8,199
14,854
(6,655)
8,199
8,199
337
(1,008)
7,528
15,417
(7,889)
7,528
1,747
–
1,747
1,747
(360)
–
1,387
1,387
–
1,387
1,387
74
–
1,461
1,461
–
1,461
19,325
(6,207)
13,118
13,118
(2,172)
(1,360)
9,586
16,241
(6,655)
9,586
9,586
411
(1,008)
8,989
16,878
(7,889)
8,989
(a) Impairment tests for goodwill
Goodwill is tested annually for impairment based on the fair value
less costs to sell of the cash generating units over which the
goodwill is allocated.
The group has companies in both Australia and the United States
– these are also determined to be the Cash Generating Units
(CGUs) of the group. The directors have determined that the
goodwill (which arose on the acquisition of the remaining share of
the US business and intellectual property) should be allocated
across these CGUs as the business combination gives rise to
synergies within both Starpharma’s Australian and United States
companies and their intellectual property.
The recoverable amounts of the group’s CGUs have been
determined based on estimation of their fair value less costs
to sell.
(b) Key assumptions used for fair value less costs to sell
estimation
The market capitalisation of the Starpharma group is used to
determine an approximation of the fair value less costs to sell of
the two CGUs which make up the group. Given the excess of the
market capitalisation of Starpharma Holdings Limited over the
carrying value of total assets (including goodwill) at 30 June 2012,
goodwill is not considered to be impaired at the end of the
reporting period.
50
(c) Impairment tests for finite life intangible assets
Identifiable intangible assets with finite lives are carried at cost less
accumulated amortisation and adjusted for any accumulated
impairment loss. The directors have assessed these assets for
12. Current liabilities – Trade and other payables
ANNUAL REPORT 2012
indicators of impairment at 30 June 2012 and determined that
there is no indication that the asset is impaired.
Trade payables and accruals
Other payables
2012
$’000
4,156
336
4,492
Consolidated
2011
$’000
940
287
1,227
Trade payables and accruals
The majority of trade payables related to expenditure associated with clinical trial programs.
13. Current and Non-current liabilities – Borrowings
Lease liabilities are effectively secured as the rights to the leased assets recognised in the financial statements revert to the lessor in the event
of default.
2012
Floating
Interest rate
Fixed interest rate
Notes
1 year
or
less
$’000
Over 1–2
years
$’000
Over 2–3
years
$’000
Over 3–4
years
$’000
Over 4–5
years
$’000
Over 5
years
$’000
Total
$’000
Lease Liabilities
20
–
40
25
27
30
18
–
140
Weighted average interest rate
–%
9.0%
8.2%
8.2%
8.2%
8.2%
–%
2011
Floating
Interest rate
Fixed interest rate
Notes
1 year
or
less
$’000
Over 1–2
years
$’000
Over 2–3
years
$’000
Over 3–4
years
$’000
Over 4–5
years
$’000
Over 5
years
$’000
Total
$’000
Lease Liabilities
20
–
49
17
Weighted average interest rate
–%
10.1%
10.1%
–
–%
–
–
–
66
–%
–%
–%
14. Contributed equity
(a) Share Capital
Share Capital
Consolidated
Consolidated
2012
Shares
2011
Shares
2012
$’000
2011
$’000
Ordinary shares – fully paid
280,802,451
247,743,578
139,171
105,399
51
STARPHARMA HOLDINGS LIMITED
(b) Movements in ordinary share capital
Date
Details
Number of shares
Issue Price
1 Jul 2010
238,842,208
$’000
101,766
9 Sep 2010
Proceeds on exercise of employee options
24 Sep 2010
Proceeds on exercise of employee options
13 Oct 2010
Proceeds on exercise of employee options
25 Oct 2010
Proceeds on exercise of employee options
3 Nov 2010
Proceeds on exercise of employee options
10 Nov 2010
Proceeds on exercise of employee options
11 Nov 2010
Proceeds on exercise of employee options
17 Nov 2010
Proceeds on exercise of employee options
17 Nov 2010
Proceeds on exercise of options
26 Nov 2010
Proceeds on exercise of employee options
2 Dec 2010
Proceeds on exercise of options
10 Dec 2010
Proceeds on exercise of employee options
20 Dec 2010
Proceeds on exercise of employee options
24 Dec 2010
Proceeds on exercise of options
10 Jan 2011
CEO equity incentive plan share issue
1 Feb 2011
Employee share plan ($1,000) issue
3 Feb 2011
Proceeds on exercise of options
14 Feb 2011
Proceeds on exercise of options
17 Feb 2011
Proceeds on exercise of employee options
7 Mar 2011
Proceeds on exercise of options
22 Mar 2011
Proceeds on exercise of employee options
28 Mar 2011
Proceeds on exercise of options
4 Apr 2011
Proceeds on exercise of options
19 May 2011 Proceeds on exercise of employee options
14 Jun 2011
Proceeds on exercise of options
250,000
280,000
50,000
50,000
172,000
350,000
150,000
290,000
20,000
168,000
600,000
175,000
30,000
750,000
487,500
28,560
600,000
600,000
150,000
639,453
210,000
1,010,000
1,500,000
158,000
182,857
$0.29
$0.50
$0.29
$0.29
$0.35
$0.50
$0.50
$0.39
$0.52
$0.48
$0.43
$0.41
$0.29
$0.43
$ –
$0.84
$0.43
$0.43
$0.43
$0.43
$0.43
$0.43
$0.43
$0.34
$0.43
72
140
14
14
60
176
75
114
10
81
261
72
9
327
–
24
261
261
65
278
95
439
652
54
79
Balance at 30 June 2011
247,743,578
105,399
52
ANNUAL REPORT 2012
Date
Details
Number of shares
Issue Price
01 Jul 2011
14 Jul 2011
Proceeds on exercise of employee options
14 Jul 2011
Employee performance rights plan share issue
09 Aug 2011
Proceeds on exercise of employee options
24 Aug 2011
Proceeds on exercise of employee options
7 Sep 2011
Proceeds on exercise of employee options
247,743,578
40,000
13,000
140,000
10,000
80,000
21 Nov 2011
Share placement
29,767,442
less transaction costs
30 Nov 2011
Proceeds on exercise of employee options
14 Dec 2011
Share placement
less transaction costs
22 Dec 2011
Proceeds on exercise of employee options
24 Jan 2012 Employee share plan ($1,000) issue
24 Jan 2012
Proceeds on exercise of employee options
29 Feb 2012
Proceeds on exercise of employee options
14 Mar 2012
Proceeds on exercise of employee options
14 Mar 2012
Proceeds on exercise of options
16 Apr 2012
Proceeds on exercise of employee options
10,000
2,791,305
40,000
22,126
75,000
10,000
10,000
20,000
30,000
$0.37
$ –
$0.39
$0.37
$0.37
$1.08
$0.37
$1.08
$0.37
$1.18
$0.29
$0.37
$0.37
$0.29
$0.37
$’000
105,399
15
–
54
4
30
32,000
(1,372)
4
3,000
(50)
15
26
21
4
4
6
11
Balance at 30 June 2012
280,802,451
139,171
(c) Ordinary shares
As at 30 June 2012 there were 280,802,451 issued ordinary
shares. Ordinary shares entitle the holder to participate in
dividends and the proceeds on winding up of the company in
proportion to the number of and amounts paid on the shares held.
On a show of hands every holder of ordinary shares present at a
meeting in person or by proxy, is entitled to one vote, and upon a
poll each share is entitled to one vote. There is no current on-
market share buy-back.
(d) Employee Share Plan ($1,000 Plan)
Information relating to the Employee Share Plan, including details
of shares issued under the plan, is set out in note 25.
(e) CEO Equity Incentive Plan
Information relating to the CEO Equity Incentive Plan, including
details of shares issued under the plan, is set out in note 25.
(f) Employee Performance Rights Plan
Information relating to the Employee Performance Rights Plan,
including details of rights issued under the plan, is set out in
note 25.
(g) Options
Information relating to the Starpharma Holdings Limited Employee
Share Option Plan and Individual option deeds, including details of
options issued, exercised and expired during the financial year and
options outstanding at the end of the financial year are set out in
note 25.
(h) Capital risk management
The group’s and the parent entity’s objectives when managing
capital are to safeguard their ability to continue as a going
concern, so that they can continue to provide returns for
shareholders and benefits for other stakeholders.
53
STARPHARMA HOLDINGS LIMITED
15. Reserves
(a) Reserves
Share-based payments reserve
Foreign currency translation reserve
Asset revaluation reserve
(b) Movement in reserves
Share-based payments reserve
Balance at 1 July
Share option expense
Performance right expense
Balance at 30 June
Foreign currency translation reserve
Balance at 1 July
Currency translation differences
arising during the year
Balance at 30 June
2012
$’000
3,265
(3,614)
2,215
1,866
2012
$’000
2,842
-
423
3,265
(4,035)
421
(3,614)
Consolidated
2011
$’000
2,842
(4,035)
2,215
1,022
Consolidated
2011
$’000
2,412
139
291
2,842
(1,751)
(2,284)
(4,035)
(c) Nature and purpose of reserves
(i) Share-based payments reserve
The share-based payments reserve is used to recognise the
fair value of options and performance rights granted.
(ii) Foreign currency translation reserve
Exchange differences arising on translation of the foreign
subsidiary are taken to the foreign currency translation
reserve, as described in Note 1(d). The reserve is recognised
in income statement when the net investment is disposed of.
(iii) Asset revaluation reserve
The uplift in fair value of the identifiable net assets of DNT on
the company’s acquisition of the remaining share in October
2006 was recognised in reserves.
16. Accumulated Losses
Accumulated losses balance at 1 July
Net loss for the year
Accumulated losses balance at 30 June
54
2012
$’000
(78,728)
(13,658)
(92,386)
Consolidated
2011
$’000
(69,798)
(8,930)
(78,728)
17. Key management personnel disclosures
(a) Key management personnel compensation
Short-term employee benefits
Post-employment benefits
Other long term benefits
Share-based payments
ANNUAL REPORT 2012
2012
$’000
2,043
204
48
301
2,596
Consolidated
2011
$’000
1,826
255
39
324
2,444
Detailed remuneration disclosures are provided in the remuneration report on pages 14 to 21.
(b) Equity instrument disclosures relating to key management personnel
(i) Options provided as remuneration and shares issued on exercise of such options
Details of options provided as remuneration and shares issued on the exercise of such options, together with terms and conditions of the
options, can be found in the remuneration report.
Option holdings
The numbers of options over ordinary shares in the company held during the financial year by each director of Starpharma Holdings Limited and
other key management personnel of the group, including their personally related parties, are set out below. No non-executive director held
options in the current or prior year.
2012
Name
Balance at the
start of the year
Granted during
the year as
compensation
Directors of Starpharma Holdings Limited
Exercised during
the year
Other changes
during the year#
Balance at the
end of the year
Vested and
exercisable at the
end of the year
Unvested
J K Fairley
–
Other key management personnel of the group
B P Rogers
200,000
J R Paull
C P Barrett
N J Baade
D J Owen
M L McColl
125,000
200,000
125,000
225,000
–
–
–
–
–
–
–
–
–
–
–
75,000
–
–
–
–
–
–
–
–
–
–
–
–
200,000
200,000
125,000
125,000
125,000
125,000
125,000
125,000
225,000
225,000
–
–
–
–
–
–
–
–
–
55
STARPHARMA HOLDINGS LIMITED
2011
Name
Balance at the
start of the year
Granted during
the year as
compensation
Directors of Starpharma Holdings Limited
Exercised during
the year
Other changes
during the year#
Balance at the
end of the year
Vested and
exercisable at the
end of the year
Unvested
J K Fairley
650,000
Other key management personnel of the group
B P Rogers
400,000
J R Paull
C P Barrett
N J Baade
D J Owen
M L McColl
475,000
575,000
425,000
425,000
–
–
–
–
–
–
–
–
350,000
(300,000)
–
–
100,000
(100,000)
200,000
200,000
350,000
–
125,000
125,000
175,000
(200,000)
200,000
200,000
300,000
200,000
–
–
–
–
125,000
125,000
225,000
225,000
–
–
–
–
–
–
–
–
–
# Other Changes during the year relate to the expiry of options.
Performance rights holdings
The numbers of rights over ordinary shares in the company held
during the financial year by each director of Starpharma Holdings
Limited and other key management personnel of the group,
including their personally related parties, are set out below. Except
for J K Fairley, no other director held share rights in the current or
prior year. J K Fairley was granted 375,000 rights to ordinary
shares on 10 November 2011. The granting of these performance
rights was approved by shareholders on 10 November 2011.
2012
Name
Balance at the
start of the year
Granted during
the year as
compensation
Directors of Starpharma Holdings Limited
J K Fairley
–
375,000
Other key management personnel of the group
B P Rogers
64,000
32,000
J R Paull
80,000
40,000
C P Barrett
80,000
40,000
N J Baade
80,000
40,000
D J Owen
80,000
40,000
M L McColl
80,000
40,000
Vested during
the year
Other changes
during the year#
Balance at the
end of the year
Vested and
exercisable at the
end of the year
Unvested
–
–
–
–
–
–
–
–
–
–
–
–
–
–
375,000
–
375,000
96,000
120,000
120,000
120,000
120,000
120,000
–
–
–
–
–
–
96,000
120,000
120,000
120,000
120,000
120,000
# Other Changes during the year relate to the forfeit of performance rights
56
ANNUAL REPORT 2012
2011
Name
Balance at the
start of the year
Granted during
the year as
compensation
Directors of Starpharma Holdings Limited
Vested during
the year
Other changes
during the year#
Balance at the
end of the year
Vested and
exercisable at the
end of the year
Unvested
J K Fairley
750,000
–
487,500
(262,500)
–
–
–
Other key management personnel of the group
B P Rogers
J R Paull
C P Barrett
N J Baade
D J Owen
M L McColl
–
–
–
–
–
–
64,000
80,000
80,000
80,000
80,000
80,000
–
–
–
–
–
–
–
–
–
–
–
–
64,000
80,000
80,000
80,000
80,000
80,000
–
–
–
–
–
–
64,000
80,000
80,000
80,000
80,000
80,000
# Other Changes during the year relate to the forfeit of performance rights
57
STARPHARMA HOLDINGS LIMITED
Share holdings
The numbers of ordinary shares in the company held during the
financial year by each director of Starpharma Holdings Limited and
other key management personnel of the group, including their
personally related parties, are set out below.
Key management personnel of the group, excluding directors,
were eligible to participate in the Employee Share Plan ($1,000
Plan). Shares to the value of $1,000 where granted to Australian-
based permanent employees under the plan during the current
and prior year.
No director has entered into a material contract with the group in
either the current or previous financial year and there were no
material contracts involving directors’ interests subsisting at
year end.
2012
Name
Balance at the
start of the year
Granted during
the year as
compensation
On exercise of
share options
during the year
On vesting of
performance rights
during the year
Other changes
during the year
Balance at the
end of the year
Directors of Starpharma Holdings Limited
Ordinary Shares
P T Bartels
J K Fairley
R Dobinson
129,804
1,819,821
–
P J Jenkins
1,426,000
R A Hazleton
142,616
Z Peach1
P R Turvey2
–
–
Other key management personnel of the group
Ordinary Shares
41,455
12,608
2,608
132,608
52,608
1,190
B P Rogers
J R Paull
C P Barrett
N J Baade
D J Owen
M L McColl
1 Appointed 1 October 2011.
2 Appointed 19 March 2012.
–
–
–
–
–
–
–
851
851
851
851
851
851
–
–
–
–
–
–
–
–
–
75,000
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
103,126
232,930
(170,624)
1,649,197
–
–
61,462
1,487,462
–
142,616
2,000
30,000
2,334
1,563
–
2,000
30,000
44,640
15,022
78,459
(11,874)
121,585
–
–
53,459
2,041
58
2011
Name
Balance at the
start of the year
Granted during
the year as
compensation
On exercise of
share options
during the year
On vesting of
performance rights
during the year
Other changes
during the year
Balance at the
end of the year
ANNUAL REPORT 2012
Directors of Starpharma Holdings Limited
Ordinary Shares
P T Bartels
J K Fairley
J W Raff1
R Dobinson
129,804
1,482,321
7,280,777
-
P J Jenkins
1,426,000
R A Hazleton
142,616
Other key management personnel of the group
Ordinary Shares
B P Rogers
J R Paull
C P Barrett
N J Baade
D J Owen
M L McColl
67,040
1,418
1,418
1,418
1,418
–
1 Resigned 17 June 2011
18. Remuneration of auditors
–
–
–
–
–
–
1,190
1,190
1,190
1,190
1,190
1,190
–
–
–
129,804
350,000
487,500
(500,000)
1,819,821
–
–
–
–
100,000
350,000
175,000
300,000
200,000
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
7,280,777
–
1,426,000
142,616
(126,775)
(340,000)
(175,000)
41,455
12,608
2,608
(170,000)
132,608
(150,000)
–
52,608
1,190
The company may decide to employ the auditor on assignments
additional to their statutory audit duties where the auditor’s
expertise and experience with the company and/or the
consolidated group are important. Details of the amounts paid or
payable to the auditor (PricewaterhouseCoopers) for audit and
non-audit services provided during the year are set out below.
During the year the following fees were paid or payable for
services provided by the auditor (PricewaterhouseCoopers) of the
parent entity, its related practices and non-related audit firms:
(a) Statutory audit services
Audit or review of financial reports of
the entity or any entity in the consolidated entity
PricewaterhouseCoopers
Total remuneration for statutory audit services
(b) Other audit services
Other audit services:
Grant reviews & program audits
PricewaterhouseCoopers
Total remuneration for other audit services
Total remuneration of auditors
2012
$
85,000
85,000
–
–
85,000
Consolidated
2011
$
113,000
113,000
18,000
18,000
131,000
59
STARPHARMA HOLDINGS LIMITED
19. Contingencies
The company has no contingent assets or liabilities at 30 June 2012 (2011: nil).
20. Commitments
(a) Capital Commitments
There is no capital expenditure contracted for, not recognised as liabilities at the reporting date (2011: nil).
(b) Lease Commitments
2012
$’000
389
171
–
560
420
166
(26)
560
2012
$’000
349
71
–
420
Consolidated
2011
$’000
335
355
–
690
624
71
(5)
690
Consolidated
2011
$’000
286
338
–
624
Commitments in relation to leases contracted for at the reporting date but
not recognised as liabilities, payable:
Not later than one year
Later than one year and not later than five years
Later than five years
Representing:
Cancellable operating leases
Non-cancellable finance lease
Future finance charges on finance leases
Operating leases
The group leases laboratory and offices under a lease until 31 August 2013.
Commitments for minimum lease payments in relation to cancellable
operating leases are payable as follows:
Not later than one year
Later than one year and not later than five years
Later than five years
Representing cancellable operating leases
60
Finance Leases
The group leases plant and equipment under a finance leases expiring within one to five years.
ANNUAL REPORT 2012
Commitments in relation to finance leases are payable as follows:
Notes
Not later than one year
Later than one year and not later than five years
Later than five years
Minimum lease payments
Future finance charges
Recognised as a liability
Representing finance lease liabilities:
Current
Non-Current
13
13
2012
$’000
50
116
–
166
(26)
140
40
100
140
Consolidated
2011
$’000
53
18
–
71
(5)
66
49
17
66
The weighted average interest rate implicit in the lease is 8.4% (2011: 10.1%).
(c) Expenditure Commitments
The group has entered into various agreements for research,
development and clinical services. These agreements have typical
termination provisions to limit the commitment to the time and
materials expended at termination, or up to an approved work
order amount.
(d) Termination Commitments
The service contracts of key management personnel include
benefits payable by the group on termination of the employee’s
contract. Refer to the remuneration report for details of these
commitments.
21. Subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the
accounting policy described in note 1(b).
Name of entity
Starpharma Pty Limited
Angiostar Pty Limited
Viralstar Pty Limited
Dendritic Nanotechnologies Inc.
Country of
Incorporation
Class of Shares
Australia
Australia
Australia
USA
Ordinary
Ordinary
Ordinary
Ordinary
Equity Holding
2011
%
100.00%
100.00%
100.00%
100.00%
2012
%
100.00%
100.00%
100.00%
100.00%
22. Events occurring after the balance sheet date
There are no significant events occurring since 30 June 2012 that
have significantly affected or may significantly affect the operations
of the group, the results of those operations, or the state of
the group.
61
STARPHARMA HOLDINGS LIMITED
23. Reconciliation of profit after income tax to net cash inflow from operating activities
Operating loss after tax:
Depreciation and amortisation
Foreign exchange (gains) / losses
Non-cash employee benefits: share-based payments
Gain (loss) on sale of property, plant and equipment
Change in operating assets and liabilities,
net of effects of acquisitions and disposals of entities:
Decrease (increase) in receivables and other assets
Increase (decrease) increase in trade creditors
Increase in employee provisions
Increase (decrease) in deferred income
Net cash outflows from operating activities
24. Earnings per share
Basic loss per share
Diluted loss per share
Net loss attributable to members of Starpharma Holdings Ltd used as the
numerator in calculating diluted and basic earnings per share ($’000)
Weighted average number of ordinary shares outstanding during the year used as
the denominator in calculating diluted and basic earnings per share
2012
$’000
(13,658)
1,142
(132)
448
(13)
(989)
3,266
116
50
Consolidated
2011
$’000
(8,930)
1,532
827
456
(7)
357
(354)
120
(477)
(9,770)
(6,476)
2012
$
(0.05)
(0.05)
(13,658)
Consolidated
2011
$
(0.04)
(0.04)
(8,930)
267,652,960
242,556,106
As at 30 June 2012 the company had on issue 2,778,809 (30 June 2011: 3,243,809) share options and 1,550,300 (30 June 2011: 750,800)
performance rights that are not considered dilutive.
The options and rights have not been included in the determination of basic earnings per share. The options and rights granted are considered
to be potential ordinary shares and have been included in the determination of diluted earnings per share to the extent to which they are dilutive.
Given the entity is currently loss making, the potential shares are anti-dilutive and have therefore not been included in the diluted earnings per
share calculation.
25. Share-based payments
Options
(a) Employee Option Plan
The establishment of the Starpharma Holdings Limited Employee
Share Option Plan (ASX code SPLAM) was approved by
shareholders at the Annual General Meeting held on 17 November
2004 and re-approved on 14 November 2007. All full-time or part-
time employees and directors of the company or associated
companies are eligible to participate in the Plan. The objective of
the Plan is to assist in the recruitment, reward, retention and
motivation of employees of the company. Options are granted
under the plan for no consideration. The vesting period is 1 to 2
years from date of grant, with the exercise period 2 to 3 years from
the end of the vesting period. Options granted under the plan carry
no dividend or voting rights. Each option is personal to the
participant and is not transferable, transmissible, assignable or
chargeable, except with the written consent of the remuneration
and nomination committee.
(b) Individual Option Deeds
The company infrequently issues options to key consultants of the
company. The objective of the option issues is to assist in the
reward, retention and motivation of consultants of the company.
Options are granted for no consideration, usually in lieu of some
62
proportion of cash compensation. Options are normally granted for
a two to five year period, with various exercisable dates. Options
granted carry no dividend or voting rights. Each option is personal
to the participant and is not transferable, transmissible, assignable
or chargeable, except with the written consent of the remuneration
and nomination committee.
Set out below are summaries of options under the schemes:
ANNUAL REPORT 2012
(c) Options Attached to a Share Placement
The company issued 7,567,119 unlisted options attached to a
share placement in August 2007. The options have an exercise
price of $0.4346 per option with an expiry date of 21 August 2012.
Options granted carry no dividend or voting rights.
2012
Grant Date
Expiry Date
Consolidated and parent entity
Exercise
Price
Balance
at start of
the year
Exercised
during
the year
Forfeited
during
the year
Expired
during
the year
Balance
at end of
the year
Exercisable
at end of
the year
$
Number
Number
Number
Number
Number
Number
21 Aug 2007c
22 Aug 2012
$0.43
1,684,809
–
31 Oct 2007 a
7 Aug 2011
$0.50
30,000
30,000
1 Jan 2009 a
28 Aug 2012
$0.29
395,000
95,000
1 Jan 2009 b
28 Aug 2012
$0.29
20,000
20,000
29 Jun 2009 a
28 Jun 2014
$0.37
1,114,000
320,000
Total
3,243,809
465,000
–
–
–
–
–
–
–
–
–
–
–
–
1,684,809
1,684,809
–
–
300,000
300,000
–
–
794,000
794,000
2,778,809
2,778,809
Weighted average exercise price
$0.39
$0.36
$ –
$ –
$0.40
$0.40
a Options granted under the Employee Option Plan.
b Options granted under individual option deeds.
c Options granted under a share placement.
No options were granted in the current year.
63
STARPHARMA HOLDINGS LIMITED
2011
Grant Date
Expiry Date
Consolidated and parent entity
Exercise
Price
Balance
at start of
the year
Exercised
during
the year
Forfeited
during
the year
Expired
during
the year
Balance
at end of
the year
Exercisable
at end of
the year
$
Number
Number
Number
Number
Number
Number
4 Jul 2005 a
4 Jul 2010
$0.94
300,000
18 Jul 2005 a
18 Jul 2010
$0.94
100,000
–
–
6 Oct 2006 a
6 Oct 2010
$0.50
898,000
280,000
2 Jan 2007 b
2 Jan 2011
$0.52
20,000
20,000
4 Apr 2007 a
4 Apr 2011
$0.50
590,000
590,000
21 Aug 2007c
22 Aug 2012
$0.43
7,567,119
5,882,310
–
–
–
–
–
–
31 Oct 2007 a
7 Aug 2011
$0.50
370,000
300,000
40,000
14 Nov 2007 a
4 Apr 2011
$0.50
150,000
150,000
14 Nov 2007 a
8 Aug 2011
$0.50
200,000
200,000
1 Jan 2009 a
28 Aug 2012
$0.29
1,358,000
963,000
1 Jan 2009 b
28 Aug 2012
$0.29
20,000
29 Jun 2009 a
28 Jun 2014
$0.37
1,144,000
–
–
–
–
–
–
30,000
300,000
100,000
618,000
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1,684,809
1,684,809
30,000
30,000
–
–
–
–
395,000
395,000
20,000
20,000
1,114,000
1,114,000
Total
12,717,119
8,385,310
70,000
1,018,000
3,243,809
3,243,809
Weighted average exercise price
$0.44
$0.43
$0.45
$0.67
$0.39
$0.39
a Options granted under the Employee Option Plan.
b Options granted under individual option deeds.
c Options granted under a share placement.
No options were granted in the prior year.
The weighted average share price at the date of exercise of options exercised during the year ended 30 June 2012 was $0.36 (2011: $0.43).
The weighted average remaining contractual life of share options outstanding at the end of the period was 0.67 years (2011: 1.77 years).
Where options are issued to employees of subsidiaries within the group, the subsidiaries compensate Starpharma Holdings Limited for the
amount recognised as expense in relation to these options.
(d) Fair value of options granted
There were no options granted in the current or prior year. The fair
value at grant date of options granted in earlier years were
independently determined using a 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 the
expected price volatility of the underlying share, the expected
dividend yield and the risk free rate for the term of the option. The
expected price volatility is based on the historic volatility (based on
the remaining life of the options), adjusted for any expected
changes to future volatility due to publicly available information.
Options are granted for no consideration, and have varying
exercise and expiry dates.
Shares
(a) Employee Share Plan ($1,000 Plan)
All executives and staff, excluding directors, are eligible to
participate in the Starpharma Employee Share Plan ($1,000 Plan).
The objective of the $1,000 Plan is to assist in the reward,
retention and motivation of employees of the group. An annual
allocation of up to $1,000 of shares may be granted and taxed on
a concessional basis. Shares are granted under the $1,000 Plan
for no consideration and are escrowed for 3 years while
participants are employed by the group.
64
(b) Fair value of shares granted
The weighted average assessed fair value at grant date of
employee shares granted during the year ended 30 June 2012
was $1.175 (2011: $0.84 per share). The fair value at grant date is
determined by the share price on the date of grant. Employee
shares were granted for no consideration.
Information used in assessing the fair value of shares granted during the year ended 30 June 2012 is as follows:
ANNUAL REPORT 2012
Share grant date
Number of shares granted
Share price at grant date
Assessed fair value
Information used in assessing the fair value of shares granted during the year ended 30 June 2011 is as follows:
Share grant date
Number of shares granted
Share price at grant date
Assessed fair value
24 January 2012
22,126
$1.175
$1.175
1 February 2011
28,560
$0.84
$0.84
Performance Rights
(a) CEO Equity Incentive Plan
Details are provided in the remuneration report.
(b) Employee Performance Rights Plan
In 2010 the board approved the introduction of the Starpharma
Employee Performance Rights Plan. All executives and staff are
eligible to participate in the Plan. The Plan allows for the issue of
performance rights (being rights to receive fully paid ordinary
shares subject to continued employment with the company and the
satisfaction of certain performance hurdles over a specified
period). A further holding lock period may also be applied to
restrict disposal after the vesting date. Performance rights are
granted under the Plan for no consideration. The objective of the
Plan is to assist in the recruitment, reward, retention and
motivation of employees of the company.
(c) Fair value of performance rights granted
The weighted average assessed fair value at grant date of
performance rights granted during the year ended 30 June 2012
was $0.81 per right (2011: $0.39). There were 842,500
performance rights granted in the current year (2011: 830,800).
The estimated fair value at grant date was independently
determined using either an option pricing or a binomial model that
takes into account the exercise price, the performance measure,
the term of the right, the impact of dilution, the share price at grant
date and the expected price volatility of the underlying share, the
expected dividend yield and the risk free rate for the term of the
option. The expected price volatility is based on the historic
volatility, adjusted for any expected changes to future volatility due
to publicly available information.
Information used in assessing the fair value of performance rights granted during the year ended 30 June 2012 is as follows:
Right grant date
10 November 2011
10 November 2011
10 November 2011
25 November 2011
Number of rights granted
125,000
125,000
125,000
467,500
Vesting date
30 September 2012
30 September 2012
30 September 2012
25 November 2013
Disposal Restriction until
30 September 2013
30 September 2013
30 September 2013
25 November 2014
Performance Measure
Share Price ≥ $1.50
Share Price ≥ $2.00
Expected price volatility of the company's
shares
Risk-free interest rate
Expected dividend yield
Share price at grant date
Assessed fair value
50%
3.8%
-
$1.08
$0.30
50%
3.8%
-
$1.08
$0.12
KPIs
50%
3.8%
-
$1.08
$0.96
KPIs
50%
3.3%
-
$1.09
$1.09
65
STARPHARMA HOLDINGS LIMITED
Information used in assessing the fair value of performance rights granted during the year ended 30 June 2011 is as follows:
Right grant date
Number of rights granted
Vesting date
Disposal Restriction until
Performance Measure
Expected price volatility of the company's shares
Risk-free interest rate
Expected dividend yield
Share price at grant date
Assessed fair value
Expenses arising from share-based payment transactions
Total expenses arising from share-based payment transactions recognised during the period were as follows:
Options issued under employee option plan
Employee shares issued
Employee performance rights issued
2012
$’000
-
26
423
449
2 September 2010
830,800
31 August 2012
31 August 2013
KPIs
31%
5.1%
-
$0.49
$0.39
Consolidated
2011
$’000
138
26
291
455
26. Related party transactions
(a) Parent entity and subsidiaries
The parent entity of the group is Starpharma Holdings Limited.
Interests in subsidiaries are set out in note 21.
(b) Key management personnel
Disclosures relating to key management personnel are set out in
note 17.
(c) Transactions with related parties
There are related party transactions within the group between the
parent and subsidiaries. Transactions include funds advanced
to/from entities and the associated interest charge; and
management and services fees. All transactions were made on an
arm’s length basis.
66
27. Parent entity financial information
(a) Summary financial information
The individual financial statements for the parent entity show the following aggregate amounts:
ANNUAL REPORT 2012
Balance Sheet
Current assets
Total assets
Current liabilities
Total liabilities
Shareholders’ equity
Contributed equity
Reserves
Accumulated losses
Loss for the year
Total comprehensive income
(b) Contingencies of the parent entity
The parent entity has no contingent assets or liabilities at 30 June 2012 (2011: nil).
2012
$'000
41,232
58,836
832
1,485
139,171
2,755
(84,575)
(10,548)
(10,548)
Parent
2011
$'000
16,876
35,349
988
1,644
105,399
2,333
(74,027)
(11,144)
(11,144)
67
STARPHARMA HOLDINGS LIMITED
Directors’ Declaration
In the directors’ opinion:
(a) the financial statements and notes set out on pages 30 to 67 are in accordance with the Corporations Act 2001, including:
(i) complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements;
and
(ii) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2012 and of its performance for the financial year
ended on that date; and
(b) there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.
Note 1(a) confirms that the financial statements also comply with International Financial Reporting Standards as issued by the International
Accounting Standards Board.
The directors have been given the declarations by the chief executive officer and chief financial officer required by section 295A of the
Corporations Act 2001.
This declaration is made in accordance with a resolution of the directors.
Peter T Bartels, AO
Director
Melbourne, 27 August 2012
68
Independent audit report to the members
Independent audit report to the members
ANNUAL REPORT 2012
ANNUAL REPORT 2012
69
69
PricewaterhouseCoopers,ABN52780433757FreshwaterPlace,2SouthbankBoulevard,SOUTHBANKVIC3006,GPOBox1331,MELBOURNEVIC3001T:61386031000,F:61386031999,www.pwc.com.auLiabilitylimitedbyaschemeapprovedunderProfessionalStandardsLegislation.Independentauditor’sreporttothemembersofStarpharmaHoldingsLimitedReportonthefinancialreportWehaveauditedtheaccompanyingfinancialreportofStarpharmaHoldingsLimited(thecompany),whichcomprisesthebalancesheetasat30June2012,andtheincomestatement,thestatementofcomprehensiveincome,statementofchangesinequityandstatementofcashflowsfortheyearendedonthatdate,asummaryofsignificantaccountingpolicies,otherexplanatorynotesandthedirectors’declarationfortheStarpharmaHoldingsLimitedGroup(theconsolidatedentity).Theconsolidatedentitycomprisesthecompanyandtheentitiesitcontrolledattheyear'sendorfromtimetotimeduringthefinancialyear.Directors’responsibilityforthefinancialreportThedirectorsofthecompanyareresponsibleforthepreparationofthefinancialreportthatgivesatrueandfairviewinaccordancewithAustralianAccountingStandardsandtheCorporationsAct2001andforsuchinternalcontrolasthedirectorsdetermineisnecessarytoenablethepreparationofthefinancialreportthatisfreefrommaterialmisstatement,whetherduetofraudorerror.InNote1,thedirectorsalsostate,inaccordancewithAccountingStandardAASB101PresentationofFinancialStatements,thatthefinancialstatementscomplywithInternationalFinancialReportingStandards.Auditor’sresponsibilityOurresponsibilityistoexpressanopiniononthefinancialreportbasedonouraudit.WeconductedourauditinaccordancewithAustralianAuditingStandards.TheseAuditingStandardsrequirethatwecomplywithrelevantethicalrequirementsrelatingtoauditengagementsandplanandperformtheaudittoobtainreasonableassurancewhetherthefinancialreportisfreefrommaterialmisstatement.Anauditinvolvesperformingprocedurestoobtainauditevidenceabouttheamountsanddisclosuresinthefinancialreport.Theproceduresselecteddependontheauditor’sjudgement,includingtheassessmentoftherisksofmaterialmisstatementofthefinancialreport,whetherduetofraudorerror.Inmakingthoseriskassessments,theauditorconsidersinternalcontrolrelevanttotheentity’spreparationandfairpresentationofthefinancialreportinordertodesignauditproceduresthatareappropriateinthecircumstances,butnotforthepurposeofexpressinganopinionontheeffectivenessoftheentity’sinternalcontrol.Anauditalsoincludesevaluatingtheappropriatenessofaccountingpoliciesusedandthereasonablenessofaccountingestimatesmadebythedirectors,aswellasevaluatingtheoverallpresentationofthefinancialreport.OurproceduresincludereadingtheotherinformationintheAnnualReporttodeterminewhetheritcontainsanymaterialinconsistencieswiththefinancialreport.Webelievethattheauditevidencewehaveobtainedissufficientandappropriatetoprovideabasisforourauditopinions.IndependenceInconductingouraudit,wehavecompliedwiththeindependencerequirementsoftheCorporationsAct2001.
STARPHARMA HOLDINGS LIMITED
Independent audit report to the members
70
Auditor’sopinionInouropinion:(a)thefinancialreportofCorporationsAct2001(i)givingatrueandfairviewofthe30June2012(ii)complyingwithAustralianAccountingStandards(includingtheAustralianAccountingInterpretat(b)thefinancialreportandnotesasdisclosedinNoteReportontheRemunerationWehaveauditedtheremunerationended30June2012.Thedirectorsofthecompanyareresponsibleforthepreparationandpresentationoftheremuneration2001.OurresponsibilityistoexpressanopinionontheconductedinaccordancewithAustralianAuditingStandards.Auditor’sopinionInouropinion,theremuneration30June2012,complieswithPricewaterhouseCoopersAntonLinschotenPartnerthefinancialreportofStarpharmaHoldingsLimitedisinaccordancewiththeCorporationsAct2001,including:givingatrueandfairviewoftheconsolidatedentity’sfinancialpositionasat2012andofitsperformancefortheyearendedonthatdate;andcomplyingwithAustralianAccountingStandards(includingtheAustralianAccountingInterpretations)andtheCorporationsRegulations2001thefinancialreportandnotesalsocomplywithInternationalFinancialReportingStandardsasdisclosedinNote1.emunerationReportemunerationreportincludedinpages14-21ofthedirectors’reportfortheThedirectorsofthecompanyareresponsibleforthepreparationandemunerationreportinaccordancewithsection300AoftheOurresponsibilityistoexpressanopinionontheremunerationreport,basedonourauditconductedinaccordancewithAustralianAuditingStandards.emunerationreportofStarpharmaHoldingsLimitedforthewithsection300AoftheCorporationsAct2001.isinaccordancewiththeconsolidatedentity’sfinancialpositionasatperformancefortheyearendedonthatdate;andcomplyingwithAustralianAccountingStandards(includingtheAustralianCorporationsRegulations2001;andInternationalFinancialReportingStandardsofthedirectors’reportfortheyearThedirectorsofthecompanyareresponsibleforthepreparationandeportinaccordancewithsection300AoftheCorporationsActeport,basedonourauditfortheyearendedMelbourne27August2012
ANNUAL REPORT 2012
Shareholder Information
The shareholder information set out below was applicable as at 31 July 2012
Supplementary information as required by ASX listing requirements.
A. Distribution of equity shareholders
Analysis of numbers of equity security holders by size of holding
1–1,000
1,001–5,000
5,001–10,000
10,001–100,000
100,000 and over
Total
Shares
Options
Performance rights
Class of equity security
516
1,346
764
1,253
216
4,095
–
–
1
6
5
12
–
–
4
17
6
27
There were 129 holders of less than a marketable parcel of ordinary shares.
B. Equity security holders
The names of the twenty largest holders of quoted equity securities are listed below:
Name
1. HSBC Custody Nominees (Australia) Limited
2. National Nominees Limited
3. JP Morgan Nominees Australia Limited
4. Citicorp Nominees Pty Limited
5. JP Morgan Nominees Australia Limited
6. T & N Argyrides Investments P/L
7. Mr Peter Malcolm Colman
8. Kenneth Nominees Pty Ltd
9. Citicorp Nominees Pty Limited
10. JPS Distribution Pty Ltd
11. Applecross Secretarial Services Pty Ltd
12. Mr Kingsley Bryan Bartholomew
13. Dr Stuart Keith Roberts
14. HSBC Custody Nominees (Australia) Limited
15. Durbin Superannuation Pty Ltd
16. Commonwealth Scientific And Industrial Research Organisation
17. UBS Wealth Management Australia Nominees Pty Ltd
18. JPS Distribution Pty Ltd
19. Mr Peter Murray Jackson
20. Mr Mario Argyrides
Ordinary shares
Percentage
Number held
of issued shares
50,475,546
47,275,727
29,807,573
12,003,655
7,487,784
5,500,799
4,097,286
4,040,000
3,513,029
3,249,511
2,885,588
2,000,000
1,625,000
1,568,289
1,559,412
1,448,798
1,438,739
1,398,523
1,225,000
1,170,000
17.92
16.78
10.58
4.26
2.66
1.95
1.45
1.43
1.25
1.15
1.02
0.71
0.58
0.56
0.55
0.51
0.51
0.50
0.43
0.42
183,770,259
65.24
71
STARPHARMA HOLDINGS LIMITED
Name
Options issued under the Starpharma Holdings Limited
Employee Share Option Plan (ASX code SPLAM)
Options issued under individual option deeds
Employee Performance Rights
Total
C. Substantial holders
Unquoted equity securities over ordinary shares
Number on issue
Number of holders
944,000
946,859
1,550,300
3,441,159
11
1
27
Substantial shareholders as shown in substantial shareholder notices received by the company as at 31 July 2012:
Name
Acorn Capital Limited
Orbis Investment Management (Australia) Pty Ltd
M&G Investment Funds
The Dow Chemical Company
D. Voting rights
Ordinary shares
Number held
36,614,463
23,151,172
25,310,817
14,406,827
The voting rights attached to each class of equity securities are set out below:
(a) Ordinary shares
On a show of hands every member present at a meeting in person or by proxy shall have one vote and on a poll
each share shall have one vote.
(b) Options
No voting rights.
(c) Performance Rights
No voting rights.
E. Securities subject to voluntary escrow
The following equity securities are subject to voluntary escrow until the date indicated:
Type of equity securities
Number of equity
securities
Number of holders
Release date
Employee Share Plan
($1,000 Plan)
Employee Share Plan
($1,000 Plan)
Employee Share Plan
($1,000 Plan)
Ordinary Shares
Ordinary Shares
Ordinary Shares
CEO Equity Incentive Plan
Ordinary Shares
Employee Performance Rights Plan
Performance Rights
Employee Performance Rights Plan
Performance Rights
22,688
26,180
21,275
487,500
717,800
375,000
16
22
25
1
20
25 January 2013
1 February 2014
25 January 2015
1 March 2013
31 August 2013
1
30 September 2013
Employee Performance Rights Plan
Performance Rights
457,500
25
25 November 2014
72
ANNUAL REPORT 2012
Intellectual Property Report
The Starpharma patent portfolio currently has around 30 active patent families with over 100 granted patents and more than 60 patent
applications pending. Three new PCT applications were filed during the year.
Key patents within the Starpharma portfolio as at 2 August 2012:
Title
Priority Date &
Publication Number
Patents Granted
Applications Pending
VivaGel® Patent Portfolio
Antiviral Dendrimers
15 June 1994
WO95/34595
Anionic Or Cationic Dendrimer
Antimicrobial Or Antiparasitic
Compositions
14 September 1998
WO00/15240
Agents For The Prevention &
Treatment Of Sexually Transmitted
Diseases-I
30 March 2001
WO02/079299
Australia, Brazil, Canada, China,
Europe, Hong Kong, Japan,
Mexico, New Zealand,
Singapore, South Korea, USA
Australia, Canada, Europe,
Japan, Mexico, New Zealand,
Singapore, South Korea, USA
Australia, Canada, China,
Europe, Hong Kong, Japan,
Mexico, New Zealand,
Singapore, South Korea, USA
Microbicidal Dendrimer Composition
Delivery System
18 October 2005
WO2007/045009
New Zealand, Russian
Federation,
22 March 2006
WO2007/106944
16 May 2011
USA
Sep 30, 1996
USA
25 October 2005
WO2007/048190
10 August 2006
WO2007/082331
11 August 2006
WO2008/017125
6 June 2011
Contraceptive Composition
Method Of Treatment Or Prophylaxis
Of Bacterial Vaginosis
Drug Delivery Patent Portfolio
Disulfide-containing dendritic
polymers
Macromolecules Compounds Having
Controlled Stoichiometry
Modified Macromolecules
Targeted Polylysine Dendrimer
Therapeutic Agent
Macromolecules
Priostar Patent Portfolio
Dendritic Polymers With Enhanced
Amplification And Interior
Functionality
China
Brazil
Argentina, Australia, Canada, China,
Europe, Hong Kong, India, Japan,
Malaysia, Mexico, South Korea,
Taiwan, USA
Australia, Canada, China, Europe,
Japan
USA, International application
Australia, Canada, Europe, USA
Australia, Canada, China, Europe,
India, Japan, USA
China, Europe, India, USA
International Application
20 April 2005
WO2006/065266
Canada, India, Israel, Japan,
Mexico, New Zealand,
Singapore, South Korea,
Taiwan, USA
Argentina, Brazil, China, Europe, Hong
Kong,
Dendritic Polymers With Enhanced
Amplification And Interior
Functionality
21 December 2005
WO2006/115547
Australia, Canada, India, Israel,
Mexico, New Zealand,
Singapore, South Korea, USA
Argentina, Brazil, China, Europe, Hong
Kong, Japan, Taiwan,
PEHAM Dendrimers for use in
Agriculture
26 October 2009
WO2011/053605
Australia, Brazil, China, Europe, India,
Japan, USA
73
Solicitors
Norton Rose
RACV Tower, 485 Bourke Street
Melbourne VIC 3000 Australia
Stock exchange listing
ASX Limited
Level 45, North Tower, Rialto, 525 Collins Street,
Melbourne VIC 3000 Australia
ASX Code: SPL
Starpharma’s American Depositary Receipts (ADRs) trade under
the code SPHRY (CUSIP number 855563102). Each Starpharma
ADR is equivalent to ten ordinary shares of Starpharma as traded
on the ASX. The Bank of New York Mellon is the depositary bank.
Starpharma’s ADRs are listed on OTCQX International
(www.otcmarkets.com), a premium market tier in the U.S. for
international exchange-listed companies, operated by OTC
Markets Group.
Website address
www.starpharma.com
STARPHARMA HOLDINGS LIMITED
Corporate Directory
Company name
Starpharma Holdings Limited
ABN 20 078 532 180
Directors
P T Bartels AO – Chairman
P J Jenkins – Deputy Chairman
J K Fairley – Chief Executive Officer
R Dobinson
R A Hazleton
Z Peach
P R Turvey
Company Secretary
Ben Rogers
Registered office
Baker IDI Building
75 Commercial Road,
Melbourne, Victoria 3004 Australia
Telephone +61 3 8532 2700
Fax +61 3 9510 5955
Postal address
GPO Box 6535
St Kilda Road Central VIC 8008 Australia
Share register
Computershare Investor Services Pty Limited
452 Johnston Street, Abbotsford VIC 3067
GPO Box 2975
Melbourne, VIC 3001
1300 850 505 (within Australia)
+613 9415 4000 (outside Australia)
www.computershare.com
Auditor
PricewaterhouseCoopers
Freshwater Place
Southbank VIC 3006 Australia
74
Starpharma holdingS limited
ABN 20 078 532 180
Baker IDI Building
75 Commercial Road, Melbourne
VIC 3004 Australia
Telphone +61 3 8532 2700
Facsimile +61 3 9510 5955
www.starpharma.com