AnnuAl RepoRt 2 013
Maria Christou, Senior Materials ScientistContentsHighlights 01Chairman’s Letter 02CEO’s Report 03Corporate and Social Responsibility 12Directors’ Report 13 Operating & Financial Review 15 Remuneration Report 18Auditor’s Independence Declaration 26Corporate Governance Statement 27Annual Financial Report 32Independent Audit Report to the Members 67Shareholder Information 69Intellectual Property Report 71Corporate Directory 72 hIGhLIGhTS
Developing dendrimer products
for pharmaceutical, life science
and other applications
VIVAGEL®
(SPL7013)
Phase 2 prevention of recurrent BV
infection clinical trial completed
DRUG DELIVERY
Signs cancer drug agreement
with AstraZeneca
Positiveresultssupportprogressioninto
apivotalphase3clinicalprogramfor
thepreventionofrecurrenceofbacterial
vaginosis(BV)indication.Thereare
noapprovedtherapiesforpreventing
Phase 3 BV treatment clinical
recurrentBV.
trials completed
®
showedexcellentsymptomatic
®
inBV.Althoughtheresultsdid
VivaGel
reliefandconfirmedtheactivityof
VivaGel
notreachtheFDA’srequiredendpoint
of2-3weekspostcessationofproduct
tosupportatreatmentindication,they
stronglysupporttheprogressionof
thecommerciallymoresignificantBV
preventionofrecurrenceindicationas
wellassupportthealternativeclaim
VivaGel® active ingredient shows
strategiesbeingpursued.
potential as novel treatment for viral
conjunctivitis
Pre-clinicalstudiesdemonstratedthe
potentanti-viraleffectofSPL7013against
importantstrainsofadenoviruswhich
causemostcasesofviralconjunctivitis,a
commoneyecomplaintforwhichthereis
nocure.
Dendrimer-enhanced version of
docetaxel superior across multiple
cancer types
Inpre-clinicalstudiesthedendrimer-
docetaxelformulationdemonstrated
superioranti-cancereffectsacrossthe
commoncancertypesofbreast,prostate,
lungandovariantumours,comparedto
®
Dendrimer-enhanced version of
Taxotere
(docetaxel)alone.
Taxotere® demonstrates targeted
tumour delivery
Starpharma’sdocetaxelformulation
resultedinlevelsofthecancerdrug
docetaxelintumourtissuemorethan
40timesgreaterthanlevelsseenwith
Taxotere
andasignificantlyextended
durationofaction.
®
AGRochEmIcAL
Globalpharmaceuticalcompany
AstraZenecasignsagreementtoundertake
studiesusingStarpharma’sproprietary
Dendrimer formulation
oncologydendrimermolecules.
improves anticancer efficacy in
lung metastasis model
Dendrimer-basedformulationof
doxorubicinwassubstantiallymore
efficaciousthanthedrugaloneintreating
secondarytumoursofbreastcancerin
New patents strengthen and
thelung.
expand drug delivery platform
AdditionalpatentsintheUSandChina
provide“compositionofmatter”and
otherbroadprotectionforStarpharma’s
dendrimersindrugdeliveryapplications.
makhteshim Agan agrochemical
collaboration
®
Starpharma’sPriostar
dendrimer
technologytobeappliedtonovel
cropprotectionformulations
acrossMakhteshimAgan’sextensive
New formulations demonstrate further
productportfolio.
improvement in crop protection
coRPoRATE
Studiesofenhancedglyphosate
reformulationsshowedimprovedrain-
fastnessandefficacy.
Receipt of first R&D tax incentive
payment
Starpharmareceived$5.4million
undertheR&DTaxIncentiveProgram,
relatingtoeligibleAustralianand
overseasR&Dactivitiesfromthe2011/12
Starpharma named “company of
financialyear.
the Year”
Starpharmawasawardedthetop
honourattheJanssen2012Industry
ExcellenceAwardsduringAusBiotech,
Australia’sleadingbiotechnologyindustry
conference.
DRUG DELIVERY
STARPHARMA HOLDINGS LIMITED ANNUAL REPORT 20131
chAIRmAN’S LETTER
DearShareholders,
OnbehalfoftheboardofStarpharma,Iampleasedtopresentthe
annualreportfor2012-13.
Ithasbeenayearofprogresswithimportantachievementsmade
acrosstheCompany’sproductportfolioincludinganumberofkey
clinicalresearchoutcomes.TheCompanycontinuestooverseeabroad
andmaturingproductportfolio,basedonourdendrimerplatform
technology,andisapproachingcommercialisationonanumberoffronts.
®
inBVandshowedtheproduct
Withthreelate-stageclinicaltrialsdueforcompletion,theyearwasa
®
.Theresultsfromthetwopivotalphase3
definingperiodforVivaGel
®
clinicalstudies,assessingVivaGel
foratreatmentindicationinbacterial
vaginosis(BV),werebothsurprisinganddisappointinginnotachieving
theprimaryefficacyendpointrequiredbytheFDA.However,theresults
didconfirmtheefficacyofVivaGel
providedexcellentsymptomaticreliefforsufferersofBV.TheCompany
continuestoinvestigateapproachestotakeadvantageoftheseresults,
whilstadvancingthelargercommercialopportunityofVivaGel
preventiveforrecurrentBVfollowingthepositivephase2clinicaltrial
results.TherecurrentBVmarketisanareaofhighunmetmedicalneed,
isestimatedtobeworthmorethan$US1billionglobally,andrepresents
®
anopportunityforVivaGel
tobethefirst-in-classproduct.Starpharma
isprogressingwiththepivotalphase3clinicaltrialprogramforthis
indicationwithpriority.
®
asa
TheseeventsunderscoretheimportanceofStarpharma’sstrategyof
aplatformtechnologythatsupportsadiverseandrobustportfolioof
productsandacrossmultipleindustries.
Starpharma’spartneredandinternalprogramsmadeimportantprogress
duringtheyearwithdendrimerdevelopmentsofferinggreatpotential
inapplicationsthatsupportanextgenerationofpharmaceuticalsand
agrochemicals.TheCompanyshoweditsdendrimerformulationof
leadoncologydrug,docetaxelishighlytargeted,haslowertoxicityand
maybeemployedasmoreeffectivetherapiesacrossmultiplecommon
cancers.Itwasalsopleasingtoaddanotherglobalpharmaceutical
companyinAstraZeneca,andleadingcropprotectioncompany,
MakhteshimAgan,toStarpharma’slistofpartners.
Shareholderscanalsobeassuredexpenditureandcashcontinues
tobeprudentlymanaged,whilecontinuingtoadvancethemultiple
opportunities.Thenetcashburnof$9million,assistedbythereceiptof
$5.4millionfromR&Dtaxincentives,ismodestgiventhenumerousand
substantialactivitiescompletedintheyear.Starpharma’scashreserves
remainstrongat$33.8millionattheendofthefinancialyear.
Iwouldagainliketoexpressappreciationtoallshareholdersfortheir
ongoingsupportandconfidence.Theuniformlypositiveoutlookfor
Starpharmafromhealthcareanalystsisencouragingfortheyearahead.
Finally,Iwouldliketothankfellowboardmembers,includingourCEO,
DrJackieFairley,herexecutivemanagementteamandallStarpharma
employees.BeingtheinauguralwinneroftheAustralianbiotechnology
industry’sJanssen2012CompanyoftheYearawardisafitting
recognitionofyourachievementsatStarpharma.
Yourssincerely,
AO
PeterTBartels,
StarpharmaChairman
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
2
cEo’S REPoRT
Professor George Kinghorn, OBE, Clinical
Director at NIHR Clinical Research Network,
Department of Genitourinary Medicine,
Royal Hallamshire and Sheffield Teaching
Hospitals in the UK.
“ As a clinician, I am very
encouraged by the (phase 2 trial
R-BV indication) data for 1%
VivaGel®. In this group of women,
almost all would have been
expected to experience recurrent
BV during the study. However,
more than 80% of VivaGel® users
remained BV free at 16 weeks.
Given there are no other approved
products for recurrent BV, I see
this finding as highly promising
– both for the management of
women with this often difficult
chronic condition and for
recurrent BV sufferers. ”
IampleasedtoprovidethisreportdetailingStarpharma’sactivities
duringthe2012-13financialyear,andalsoourplansforthefuture.
Ithasbeenayearofimportantprogressacrossthethreefocusareas
ofourbusiness:VivaGel
VivaGel® portfolio
Bacterial vaginosis (BV)
®
,drugdeliveryandagrochemicals.
®
AnumberofkeyclinicalmilestoneswerereachedacrosstheVivaGel
portfolioduringtheyear,withthreelate-stageclinicaltrialscompleted
inbacterialvaginosis(BV).
Twophase3trialsreportedinNovemberconclusivelydemonstratedthe
®
toproviderapidandlastingrelieffromthesymptoms
abilityofVivaGel
associatedwithBVfollowing7daysoftherapy.AlthoughtheFDArequired
endpointofclinicalcureat2-3weekspostcessationoftreatmentwas
notmet,investigationsareongoingtodeterminetheregulatoryapproval
pathwayfortheproductforsymptomaticreliefofBV.
®
attheEOT(endof
Giventheclear-cutefficacyshownforVivaGel
treatment)timepoint,theexcellentandsustainedsymptomaticrelief
®
,anditssuperioracceptabilityprofile,
reportedbywomenusingVivaGel
thecompanyisactivelyexploringalternativeclaimstrategiessuchas
symptomaticrelief,andalsootherregulatoryjurisdictions.Dialogue
continueswithclinicalexperts,regulatoryagenciesandpartners
regardingthesestrategies.Basedoninitialfeedbackitseemslikelythat
thereareanumberofmarketsoutsidetheUSAwhereexistingclinical
datacouldsupportanapprovalandcommercialinterestinthatproduct
concepthasbeenconfirmedbypotentialpartners.
®
Thephase3studyresultsprovidedclearevidencethatuseofVivaGel
wasassociatedwithresolutionofBVsymptomsandnormalizationof
theabnormalvaginalmicrofloracharacteristicofBV.Apartfromthe
potentialforclaimstrategiessuchassymptomaticreliefratherthan
®
treatment,theseeffectsalsoclearlysupporttheuseofVivaGel
asa
chronictherapyforpreventionofrecurrentBV.Asubsequentphase
2studydemonstratedthatVivaGel
recurrentBV(R-BV),anddelayedtimetofirstrecurrence.Morethan
®
80%ofwomenusingVivaGel
remainedBV-freeattheendofthestudy,
representingaclinicallysignificantreducedriskofexperiencingBVof
upto56%comparedwithplacebo.
®
didindeedreducetheriskof
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
3
Left: Jackie Fairley, CEO
cEo’S REPoRT
Patient experiences with
VivaGel® (BV Phase 3 trial
participants)
“ I think it pretty
much started to
go away right
when I started
using it .”
Bacterial vaginosis (BV) continued
“ I thought it was
effective because
within the first
day I noticed a
change already.
It was, like, gone
almost overnight.”
ThemarketvalueforpreventionofrecurrentBVisestimated
atmorethanUS$1billiongloballyandnoalternativeapproved
therapiesexisttomanagethisproblematiccondition.BVisthe
mostcommonvaginalinfectionworldwide,and50-60%ofwomen
withBVexperiencerecurrencewithin6months.BVisparticularly
prevalentintheUS,whereitaffectsanestimatedone-thirdofthe
adultfemalepopulation.Theconditioncausesunpleasantdischarge
andmalodour,whichcanhaveasignificantsocialimpactformany
women.Inaddition,BVisassociatedwithpelvicinflammatory
disease,infertilityandmiscarriageandhasalsobeenassociated
withincreasedriskoftransmissionandacquisitionofsexually
transmittedinfections,includingHIV.
Thedatacollectedacrossthethreetrialsclearlydemonstrate
thehighpotentialofVivaGel
managementofBVanditremainsthefocusofthecompanyto
pursuetheR-BVmarketwithhighpriority,givenitshighly
attractivecommercialfeatures.
®
asanoveltherapyfortheongoing
Time to the first case of R-BV in clinical patients
1% VivaGel®
Placebo gel
• 5 days
Patient experiences with
VivaGel® (BV Phase 3 trial
participants)
“ The next day I
noticed a huge
difference.”
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
4
Patient experiences with VivaGel® (BV Phase 3 trial participants)• 35 days cEo’S REPoRT
“ I have rated this
product a five
(out of five) as
this is a major
breakthrough
in the condom
market, and for
world health...”
The VivaGel®-coated Condom
®
-coatedcondomproductiscurrentlyunderregulatory
TheVivaGel
reviewaheadofmarketlaunchwithpartnersAnsellandOkamoto.
Arangeofpre-launchactivitieshaveoccurredintheyearwithour
partners,includingconsumerresearch,productpositioning,package
design,andmanufacturingvalidation.
®
-condomcoatingproducthasbeenlicensedtoAnsell
TheVivaGel
andOkamoto,providingStarpharmawithaccesstotheUS$1.1billion
globalbrandedcondommarketwiththeseleadingcondomcompanies.
BothAnsellandOkamotoholdstrongmarketpositionsintheir
respectivemarketsandtheirsuccesshasbeenfoundedonastrong
focusoninnovation.Consumerresearchconfirmsstronginterestin
acondomthatcaninactivateSTIs.
“ Ansell has partnered with
Starpharma to validate a process
of coating an Ansell condom with
unique VivaGel®. This ground
breaking technology has been
shown in lab trials to deactivate
many viruses that cause STI’s. The
dendrimer technology perfected
by Starpharma over many years
is supported by millions of dollars
of clinical trials, and Ansell is
fortunate enough to be the partner
to help bring the resulting condom
product to market. Regulatory
review processes are already
underway for this product with
plans to commercialise this world-
leading condom technology in the
near future.”
Ansellisrankednumbertwogloballyforcondomsales,marketing
®
brand.
leadingbrandsincludingLifestyles
IthasaleadingmarketpositionintherapidlyexpandingAsiaPacific
andSouthAmericanmarketsandinAustraliawitharound70%
marketshare.
®
andtheSKYN
®
,ZERO
OkamotoisJapan’sleadingmarketerofcondomswithover60%share
oftheJapanesecondommarket–thesecondlargestglobalcondom
marketestimatedtobeintheorderofUS$500million.
Other VivaGel® Applications
DuringtheyearStarpharmaalsoidentifiedtheactiveinVivaGel
–SPL7013–ashavingpotentialasanoveltherapeuticforviral
conjunctivitis,acommoneyecomplaintforwhichthereisnocure
andwithanestimatedmarketof$US700million.
®
Inpre-clinicalstudiesSPL7013hasdemonstratedthepotentanti-viral
effectagainstimportantstrainsofadenovirus,whichcausemostcases
ofviralconjunctivitis.WorkisalreadyunderwaytodevelopanSPL7013-
containingocularformulationtosupportactivitiesandongoingdialogue
withpotentialcommercialpartners.
Currenttreatmentsforviralconjunctivitisarefocusedonsymptom
relief,andthepatientcanremaininfectiousandsymptomaticforseveral
weeks.Currently,curativetreatmentsexistonlyforconjunctivitiswitha
bacterialcause.
Theappealoftheopportunityisenhancedbytheadvancedstageof
®
,withtheexistingbodyofdata
developmentofSPL7013inVivaGel
reducingdevelopmentcostsandexpeditingtimelines,thusimproving
theattractivenessforcommercialpartners.
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
5
Consumer opinion of the VivaGel®-coated condom from recent market researchPeter Carroll, President and General Manager – Sexual Wellness Global Business Unit, Ansell Limited
cEo’S REPoRT
Drug Delivery Portfolio
Starpharmamadefurtherimportantadvancesacrossitsdrugdelivery
programduringtheperiodwiththeresultsunderliningthehigh
potentialofdendrimerapplicationsindrugdelivery–acrossaspectrum
ofdiseaseareas,includingoncologywhereStarpharma’sownprograms
arefocused.
Additionaldrugdeliverypatentswithbroadclaimswereobtainedin
thekeyUSandChinesemarkets,includingcommerciallyattractive
“compositionofmatter”protection.Thesepatentshavesignificantly
broadenedandexpandedStarpharma’sintellectualpropertyportfolio
indrugdeliverytechnology.
Dendrimer-Docetaxel program
Pre-clinicalstudiescompletedduringtheperiodcontinuedtoexpand
thearrayofimportantperformancegainsattributedtoadendrimer
versionoftheanti-cancerdrug,docetaxel,Starpharma’sinternallead
drugdeliverycandidatethattheCompanyisprogressingtohumantrials
laterin2013.
InOctober,theCompanyreleasedfindingswhichshowedmajor
improvementintheabilityofitsdendrimer-docetaxelproducttotarget
tumourscomparedwithdocetaxelalone.Treatmentwiththedendrimer-
docetaxelformulationresultedinlevelsofthecancerdrugdetectedin
®
,themarketed
cancertissuearound40timesgreaterthanforTaxotere
docetaxelformulation.TheimprovedtumourtargetingofStarpharma’s
dendrimer-docetaxelnanoparticleaddstoalistofotherknown
performanceadvantages.Theseincludeimprovedefficacyinabreast
cancermodel,extendedhalf-lifeofthedrugandimprovingthedrug’s
solubilityallowingtheremovaloftoxicexcipients.
InDecember,Starpharmareleasedfurtherresultsofefficacyinanimal
studieswhichdemonstratedthatinadditiontotheearlierbreastcancer
results,thedendrimer-enhancedversionofdocetaxelsignificantly
outperformedtheleadingdrugTaxotere
includingovarian,lungandprostate.
®
inarangeofimportantcancers
®
andgeneratedsalesinexcessofUS$3billionin
Docetaxelisaleadingchemotherapydrugusedtotreatawiderange
ofcancersincludingbreast,lungandprostate.ItismarketedbySanofi
AventisasTaxotere
®
2010.Sanofi’spatentsrelatingtoTaxotere
havelapsedinmanymarkets,
enablingthedevelopmentofthisimproveddendrimer-docetaxelproduct.
Starpharma’simprovedformulationisthesubjectofnewpatentsfiled
offeringcoverageofitsproprietyversionofthisimportantdrugtothe
year2032.
Partnered pharmaceutical programs
Starpharma’spartnereddrug-deliveryprogramcontinuestorunin
parallelwiththeinternalprogram,andincludesagrowingnumber
ofleadingpharmaceuticalcompaniesincludingGSKandLilly.
InSeptember,anothermajorpharmaceuticalcompanywasaddedto
thislistwithAstraZenecasigninganagreementallowingittotest
certainproprietyoncologymoleculesbasedonStarpharma’s
dendrimertechnology.
Starpharmanowhaspartneredwitharoundhalfofthetoptenglobal
pharmaceuticalcompanies,withourpartnersapplyingdendrimers
asameanstoimprovedeliveryofsmallmoleculeandprotein-based
pharmaceuticals.Thesearrangementsandresultsaresubjectto
confidentialityprovisions,buttherelationshipsareprogressingpositively.
Docetaxel is a leading
chemotherapy drug
used to treat a wide
range of cancers
including breast,
lung and prostate. It
is marketed by Sanofi
Aventis as Taxotere®
and generated sales
in excess of US$3
billion in 2010.
STARPHARMA HOLDINGS LIMITED ANNUAL REPORT 20136 cEo’S REPoRT
Other Drug Delivery Programs
Starpharmaisalsoexaminingadditionalwaysinwhichdendrimerscan
beusedtoimprovethetargeteddeliveryofdrugs–usingdendrimers
asstructurestowhichantibodies(actingastargetingagents)are
attachedalongwithexistingsmallmoleculecytotoxic(cell-killing)drugs
toproduceapowerfultherapyagainstcancers.Theseantibodydrug
conjugatesrepresentaveryactiveandexcitingareaofcancertherapy.
InMarch,additionalpositiveresultswereannouncedofastudy
examiningadendrimerformulationoftheanti-cancerdrugdoxorubicin
anditsabilitytocombatthesecondarytumoursofbreastcancerinthe
lungs.Inthisstudythedendrimer-doxorubicindeliveredviatheairways
showedsubstantiallygreatereffectinpreventingsecondarytumoursin
thelungthandrugaloneviathestandardrouteofadministration.This
widensthepossibilitiesonhowcancertreatmentsmaybedelivered
tothelungs,historicallyachallengingareatotreat,andopensupan
interestingopportunityforthepotentialuseofdendrimersforthe
deliveryviathelung.
STARPHARMA HOLDINGS LIMITED ANNUAL REPORT 20137Dr Sammi Tsegay, Research Scientist cEo’S REPoRT
Agrochemicals and crop protectionInternal and partnered agrochemical programs completed during the period continued to underscore the commercial potential of Starpharma’s Priostar® dendrimer applications in this field. A number of new partnership agreements were signed during the year including a major new partner welcomed in March, with Makhteshim Agan signing an agreement that will see Priostar® dendrimer technology applied to novel crop protection formulations across its extensive product portfolio.Makhteshim Agan is the world’s leading manufacturer and distributor of branded off-patent crop and non-crop protection products, with global sales last year of US$2.83 billion. Makhteshim Agan serves farmers in 120 countries and operates in Australia as Farmoz. This agreement is a major development for the agrochemical program, in terms of the scope of application of the Company’s Priostar® dendrimer technology and the potential addressable market for dendrimer-based products. Starpharma now has partnerships with around half of the top 10 global agrochemical companies. Starpharma’s internal agrochemical program includes a number of generic actives including an enhanced reformulation of the best-selling herbicide glyphosate – more commonly known as Roundup®- which STARPHARMA HOLDINGS LIMITED ANNUAL REPORT 20138has annual sales in excess of US$5 billion. In October, the Company announced the results of internal studies showing improved efficacy and rain-fastness from a dendrimer-glyphosate formulation. The dendrimer-glyphosate formulation demonstrated a substantial improvement in rain-fastness compared to Roundup® alone.Priostar dendrimers have also shown potential to underpin novel crop protection products and applications via a number of improvements including:• Improved herbicidal activity; • Solubility enhancement for more concentrated formulations to reduce transport costs and harmful solvent residues; and• Modification of soil penetration properties. Many crop protection products contain high levels – up to 70% – of 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. cEo’S REPoRT
Starpharma
now has
partnerships with
around half of
the top 10 global
agrochemical
companies.
STARPHARMA HOLDINGS LIMITED ANNUAL REPORT 20139 cEo’S REPoRT
Dr Pauline Stanislawski, Senior Research ScientistSTARPHARMA HOLDINGS LIMITED ANNUAL REPORT 201310 cEo’S REPoRT
Overview of financial result
Thekeymetricofnetcashoutflowsfromoperationswas$9.8million
fortheyearended30June2013.Thisresultincludesthe$5.4million
R&DtaxincentiverefundreceivedbyStarpharmaintheMarchquarter.
Cashreservesat30June2013were$33.8million.
Starpharmareportedanetlossaftertaxof$5.2million,areductionfrom
theprioryearfrom$13.7millionsignificantlyduetotheadditionalR&D
taxincentiverefundrecognisedintheyear.
Financial Summary
Year Ended 30 June
2013
$m
2012
$m
0.8
-
1.6
2.4
(6.7)
(5.2)
(10.0)
0.9
33.8
0.9
0.2
1.8
2.9
(16.6)
(13.7)
(9.9)
33.7
42.8
Royalty,customerandlicencerevenue
Grantincome
Interestrevenue
Totalrevenue&income
Expenditure
Netlossaftertax
Netoperatingandinvestingcashoutflows
Netproceedsfromissueofshares
Cashandcashequivalentsattheendofyear
outlook
®
topivotalphase3trialsforthepreventionofrecurrent
ThisisanexcitingtimeforStarpharma.TheCompanyisplanningtosoon
takeitsdendrimer-docetaxelproductintotheclinic.TheCompanyisalso
progressingVivaGel
BVindication,thelargestpotentialmarketforBV.Regulatoryreviewsfor
®
-coatedcondomareunderwaywithmanypre-launchactivities
theVivaGel
complete.Starpharmawillalsocontinuetoexpandtheextensivepartnered
programs,whichincludemanyofthetop10globalpharmaceuticaland
agrochemicalcompanies.Theseandotherdevelopmentsareexpectedto
supportincreasingshareholdervalueinthefuture.
Chief Executive Officer
JackieFairley
STARPHARMA HOLDINGS LIMITED ANNUAL REPORT 201311 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 PeopleThe 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 workplace 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. Starpharma also has a Health and Wellbeing policy to support employees in maintaining or adopting healthy lifestyles, recognising that employee physical and mental health has a positive impact on the individuals and culture of the organisation.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 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.Our PartnersStarpharma 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 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 CommunityThe 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. 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.The EnvironmentThe 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. 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. Dr David Owen, VP ResearchSTARPHARMA HOLDINGS LIMITED ANNUAL REPORT 201312 DIRECTORS’ REPORT
Your directors have pleasure in presenting this report on the consolidated entity (referred to hereafter as the group) consisting of Starpharma
Directors
Holdings Limited and the entities it controlled at the end of, or during, the year ended 30 June 2013.
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 A Hazleton
J K Fairley (Chief Executive Officer)
P R Turvey
P J Jenkins (Deputy Chairman)
Z Peach
Information on Directors
R Dobinson was a director from the beginning of the financial year until his resignation on 28 November 2012.
Peter T Bartels, AO
Jacinth (Jackie) K Fairley
, FAISM, FRSA
Independent non‐executive director
Chairman
Member of remuneration & nomination committee
Member of audit & risk committee
Independent non‐executive director and Chairman for ten 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
332,930 ordinary shares in Starpharma Holdings Limited
Executive director
Chief Executive Officer
BSc, BVSc (Hons), MBA
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
1,824,197 ordinary shares in Starpharma Holdings Limited
960,000 employee performance rights
Peter J Jenkins
Richard A Hazleton
MB, BS (Melb), FRACP
Independent Non‐executive director
Deputy Chairman
Chairman of remuneration & nomination committee
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.
Other current directorships of listed entities: Nil
Former directorships of listed entities in last 3 years: None
1,537,462 ordinary shares in Starpharma Holdings Limited
BSChE, MSChE, HonDrEngr, HonDrCommSci
Independent Non‐executive director
Member of audit & risk committee
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
157,616 ordinary shares in Starpharma Holdings Limited
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
13
13
Zita Peach
BSc
Independent Non‐executive director
Member of remuneration & nomination committee
Peter R Turvey
BA/LLB, MAICD
Independent Non‐executive director
Chairman of audit & risk committee
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
3,000 ordinary shares in Starpharma Holdings Limited
Ross Dobinson
B Bus (Acc)
Independent Non‐executive director until 28 November 2012
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
Nil 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.
Other current directorships of listed entities: Allied Healthcare Group
Former directorships of listed entities in last 3 years: None
47,000 ordinary shares in Starpharma Holdings Limited
Company Secretary
The Company Secretary is Mr Ben Rogers. 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.
14
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
14
OPERATING & FINANCIAL REVIEW
Principal Activities
The principal activities of the group consist of research, 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
for the treatment and prevention of
vaginal microbicide VivaGel
bacterial vaginosis, as a condom coating and for prevention of genital
herpes and HIV, and the application of dendrimers to drug delivery
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
Result
coatings.
®
The financial report for the financial years ended 30 June 2013 and
30 June 2012, and the results herein, have been prepared in
accordance with Australian Accounting Standards.
The consolidated loss after income tax attributable to ordinary
owners for the financial year ended 30 June 2013 was $5,229,000
(2012: $13,658,000). The net operating and investing cash outflows
for the year were $9,951,000 (2012: $9,903,000), with a cash balance
Dividends and distributions
at 30 June 2013 of $33,840,000 (June 2012: $42,812,000).
No dividends were paid or declared during the period and no
dividends are recommended in respect to the financial year ended 30
Review of Operations
June 2013 (2012: Nil).
®
Key highlights for the year include:
®
®
condom
as a novel
for prevention of
Completion of 3 late‐stage clinical trials for VivaGel
Bacterial Vaginosis (BV) therapy (one Phase 2 and two Phase 3);
Positive Phase 2 trial results for VivaGel
recurrent BV (R‐BV) supporting its progression into Phase 3;
Completion of a number of key activities for the VivaGel
coating in collaboration with partners Okamoto and Ansell to
facilitate launch following requisite approvals;
Key development advances in Starpharma’s dendrimer‐docetaxel
nanoparticle formulation in preparation for human trials;
Progress with key partnerships in drug delivery, including a new
agreement signed with AstraZeneca for oncology;
Established new agrochemicals partnerships with crop protection
companies for dendrimer applications within their crop
protection portfolio;
Identification of potential for SPL7013, the active in VivaGel
novel treatment for viral conjunctivitis;
Dendrimer nanoparticles showed efficacy in a lung
metastasis model;
Approval by AusIndustry for certain overseas R&D activities to be
eligible under the R&D tax incentive scheme; and
Starpharma was awarded the AusBiotech’s 2012 Australian
Company of the Year at the Janssen 2012 Industry
Excellence Awards.
as a
®
®
®
) for the treatment of
There were two key clinical results in the year:
In November 2012, Starpharma announced the results of its two
phase 3 studies of 1% SPL7013 Gel (VivaGel
bacterial vaginosis (BV). Both studies showed that VivaGel
statistically significant Clinical Cure and resolution of patient‐
reported symptoms of BV at the End of Treatment visit (EOT, 2‐5
days post treatment). However, the primary endpoint of Clinical
Cure 2‐3 weeks after the cessation of treatment (Test of Cure, TOC
visit) was not met. A new drug application (NDA) for VivaGel
treatment of BV was not filed with the FDA at that time due to the
lack of statistical significance at TOC, although other claim strategies
(e.g. symptomatic relief) and other regulatory jurisdictions are being
explored.
®
for the
achieved
®
®
®
and time to
In April 2013, Starpharma announced the positive results of its
exploratory Phase 2 study of VivaGel
for the prevention of recurrent
bacterial vaginosis (R‐BV). The results showed a reduced overall risk
of R‐BV during the study in patients using 1% VivaGel
first recurrence was delayed compared with placebo. The results
to inhibit BV recurrence, as was
demonstrated the ability of VivaGel
suggested by results of earlier clinical trials, and they provide strong
for
support for the advancement to Phase 3 clinical trials of VivaGel
the prevention of R‐BV. The Phase 2 study also showed high levels of
. In this
user satisfaction, in line with earlier clinical trials of VivaGel
study 79% of users of 1% VivaGel
satisfied or extremely satisfied with the product’s effectiveness and
overall satisfaction. Planning and feasibility is now underway for
conduct of the Phase 3 clinical program.
were either satisfied, very
®
®
®
A number of important developments also occurred within the drug
delivery and agrochemical programs during the year. New top‐tier
partners including Astra Zeneca and Makhteshim Agan signed up
with Starpharma, while internal studies demonstrated an expanding
array of high potential applications for dendrimers in drug delivery,
and additional key patents were granted in US and China.
The collaboration with Astra Zeneca gives that company rights to test
certain proprietary Starpharma oncology compounds based on
Starpharma’s dendrimer technology.
Makhteshim Agan, a leading manufacturer and distributor worldwide
of crop‐protection solutions, will assess Starpharma’s Priostar
dendrimers for potential application in novel crop protection
formulations across its extensive product portfolio.
®
In the Company’s internal drug delivery program, animal studies
have continued to expand the array of important performance gains
attributed to a dendrimer version of the anti‐cancer drug docetaxel,
the company’s lead drug delivery candidate which will advance to
Matter subsequent to the end of the financial year
first human trials later in 2013.
No matters or circumstances have arisen since 30 June 2013 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
Business strategy, future developments and prospects
(c) the consolidated entity’s state of affairs in future financial years.
®
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. The Company’s key focus is to advance and broaden its
product development pipeline for VivaGel
agrochemicals. It is intended to achieve this by continuing to utilise a
combination of internally funded and partnered projects across the
portfolio. The Company commercialises its development pipeline
with corporate partners via licensing agreements at various stages in
a product’s development lifecycle; depending on the product, a
partner’s relative strength of product and market expertise,
comparison of current and future potential returns, and the risks
involved in advancing the product to the next value inflection point
or milestone.
, drug delivery and
Starpharma remains well positioned to create value in the medium
term, due to its deep expertise, strong intellectual property portfolio,
diverse development portfolio, a culture and ability to innovate and
adapt its technology platform to product opportunities, proven risk
management practices, and a solid cash position. The Company will
continue using its cash resources to invest in selected research and
Legal
development activities to achieve its objectives.
At the date of the Directors’ Report there are no significant
legal issues.
15
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
15
Review of Financials
Material Business Risks
Income statement
Revenue from continuing operations
Other income
Research and development expenses
Administration expenses
Finance costs
Loss attributable to members
Income statement
2013
$’000
2,429
5
(3,505)
(4,149)
(9)
(5,229)
Year Ended
30 June
2012
$’000
2,744
160
(12,088)
(4,466)
(8)
(13,658)
The reported loss after tax of $5,229,000 is after fully expensing all
research and development expenditure and patenting costs in the
current year. A contra research and development expense of
$8,704,000 has been recorded for research and development
activities eligible under the Australian Government’s R&D Tax
Incentive program. Of the total, $4,071,000 related to 2012
expenditure not previously booked due to the uncertainty of its
eligibility. Subsequent to the 2012 results, Starpharma received an
advance finding from AusIndustry that covers certain overseas
activities over a 3 year period from 1 July 2011.
®
Research and development expenses include the costs of the
clinical program, particularly in relation to treatment and
VivaGel
prevention of bacterial vaginosis (BV), and the internal drug delivery
and agrochemical programs.
Total revenue and other income for the year was $2,434,000, a
reduction of $470,000 from the previous year, on lower interest
revenue earned on cash deposits and grant income from the US
National Institutes of Health. Revenue consists predominately of
royalty, licensing and research revenue from commercial partners of
$840,000 (2012: $881,000) and interest income on cash invested in
Balance sheet
deposits of $1,569,000 (2012: $1,819,000).
At 30 June 2013 the Group’s cash position was $33,840,000 (June
2012: $42,812,000). Trade and other receivables of $5,492,000 (June
2012: $2,053,000) includes $4,632,000 receivable from the
Statement of cash flows
Australian Government under the R&D Tax Incentive program.
®
The net operating and investing cash outflows for the year were
$9,951,000 (2012: $9,903,000) included costs associated with the
, drug delivery and agrochemical programs.
Company’s VivaGel
During the financial year $5,395,000 was received from R&D tax
incentives associated with eligible expenditure and activities from
the prior financial year.
Net cash inflows from financing activities of $828,000 included
Earnings per share
$878,000 on the issue of shares from the exercise of share options.
Basic loss per share
Diluted loss per share
2013
($0.02)
($0.02)
2012
($0.05)
($0.05)
The group operates in the biotechnology and pharmaceutical sectors
and is in the development phase. Any investment in the
biotechnology industry is considered high‐risk. The group is subject
to normal business risks, including but not limited to interest rate
movements, labour conditions, government policies, securities
market conditions, exchange rate fluctuations and a range of other
factors which are outside the control of the Board and management.
More specific material risks of the sector and the group include, but
are not limited to:
Scientific, technical & clinical – product development requires a
high level of scientific rigour, which the outcomes cannot be known
beforehand. Activities are experimental in nature so the risk of
failure or delay is material. Key development activities, including
clinical trials and product manufacture, are undertaken by
specialist contract organisations; and there are risks in managing
the quality and timelines of these activities.
Regulatory – products and their testing, may not be approved by,
or be delayed by regulatory bodies (eg. US Food and Drug
Administration) whose approvals are necessary before products
can be sold in market.
Financial ‐ the group currently, and since inception, does not
receive sufficient income to cover operating expenses. Although
the current cash reserves are sound, there is no certainty that
additional capital funding may not be required in the future, and no
assurance can be given that such funding will be available, if
required.
Intellectual property (IP) – commercial success requires the ability
to develop, obtain and maintain commercially valuable patents,
trade secrets and confidential information. Gaining and
maintaining the IP across multiple countries; and preventing the
infringement of the group’s exclusive rights involves management
of complex legal, scientific and factual issues. The Company must
also operate without infringing upon the IP of others.
Commercialisation – the Company relies, and intends to rely, upon
corporate partners to market, and in some cases finalise
development of its products, on its behalf. There are risks in
establishing and maintaining these relationships, and with the
manner in which partners execute on these collaborative
agreements.
Product acceptance & competiveness – a developed product may
not be considered by key opinion leaders (eg. doctors),
reimbursement authorities (eg. PBA‐listing) or the end customer to
be an effective alternative to products already on market, or new
superior future products may be preferred.
Product liability – a claim or product recall would significantly
impact the Company. Insurance, at an acceptable cost, may not be
available or be adequate to cover liability claims if a marketed
product is found to be unsafe.
Key personnel – the Company’s success and achievements against
timelines depend on key members of its highly qualified,
specialised and experienced management and scientific teams. The
ability to retain and attract such personnel is important.
Grant and R&D incentives – the Company may undertake R&D
activities under competitive grants and be part‐funded by other
incentive programs (eg R&D tax credits). There is no certainty that
grants or incentive programs will continue to be available to the
Company, and changes in government policy may reduce their
applicability.
In accordance with good business practice in the pharmaceutical
industry the company’s management actively and routinely employs
a variety of risk management strategies. These are broadly described
in the Corporate Governance Statement (section 7.1. Risk assessment
and management).
16
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
16
Health and Safety
Meetings of Directors
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
Environment and Regulation
working in that area. The OH&S committee meets on a monthly basis.
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. There were no significant changes in laws or
regulations during the 2013 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.
The number of meetings of the company’s board of directors and of
each committee held during the year ended 30 June 2013, and the
numbers of meetings attended by each director were:
Remuneration &
nomination
committee
Directors
Board
Audit & risk
committee
P T Bartels
P J Jenkins
J K Fairley
R A Hazleton
Z Peach
P R Turvey
R Dobinson
8 of 8
8 of 8
8 of 8
5 of 8
6 of 8
7 of 8
3 of 4
3 of 3
N/A
N/A
3 of 3
N/A
3 of 3
N/A
3 of 3
3 of 3
N/A
N/A
3 of 3
N/A
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.
17
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
17
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
Directors and key management personnel disclosed
of companies.
Non‐executive and executive directors – see pages 13 to 14 above
Other key management personnel
N J Baade
C P Barrett
D J Owen
J R Paull
B P Rogers
M L McColl
Role of the remuneration committee
Chief Financial Officer
VP, Business Development
VP, Research
VP, Development and Regulatory Affairs
Company Secretary
VP, Business Development (until 18 January 2013)
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 2013 was $385,000 (2012: $362,097).
Superannuation contributions required under the Australian
superannuation guarantee legislation continue to be made and are
deducted from the directors’ overall fee entitlements.
Directors’ Fees
2013
Chair
Other non‐executive directors
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:
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.
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.
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
18
18
Starpharma Employee Performance Rights Plan
Performance review and development
The introduction of the Starpharma Employee Performance Rights
Plan (ASX code SPLAK) was approved by the board in 2010 and
subsequently approved by shareholders at the 2011 annual general
meeting. 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 unless otherwise
determined by the Board.
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 unless
otherwise determined by the Board.
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 may be 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.
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
Corporations Act 2001
remuneration recommendations as defined in section 9B of the
, 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.
Voting and comments made at the company’s 2012 Annual
General Meeting (AGM)
Of the votes cast on the company’s remuneration report for the 2012
financial year, 97% 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:
®
®
‐condom
;
Completion of 3 late‐stage clinical trials for VivaGel
Completion of key pre‐launch activities for the VivaGel
coating in collaboration with partners Okamoto and Ansell;
Advanced development activities in the dendrimer‐docetaxel
nanoparticle formulation;
Progress partnerships in drug delivery, including a new agreement
signed with AstraZeneca for oncology;
Established four new agrochemicals partnerships with major crop
protection companies for dendrimer applications within their crop
protection portfolio;
Demonstration of adenoviral activity in SPL7013 and patent filing
on findings; and
Approval by AusIndustry of submission for certain overseas R&D
activities to be eligible under the R&D tax incentive scheme,
resulting in the $5.4 million receipt of R&D tax incentives.
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 of 30%.
19
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
19
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.
2013
Post‐
employment
Long‐term
benefits
Share‐based payments
Short‐term benefits
Non‐executive directors
Name
Cash salary &
fees
$
P T Bartels
1
R Dobinson
P J Jenkins
R A Hazleton
Z Peach
Executive directors
P R Turvey
120,000
25,000
55,046
60,000
55,046
50,034
#
Cash bonus
$
–
–
–
–
–
–
Non‐monetary
benefits
$
Superannuation
$
Long service
leave
$
–
–
–
–
–
–
–
–
4,954
–
4,954
9,966
–
–
–
–
–
–
Other Key Management Personnel (group)
J K Fairley
150,000
368,213
40,608
21,286
27,824
B P Rogers
J R Paull
C P Barrett
N J Baade
D J Owen
Totals
M L McColl
2
117,680
185,280
206,158
183,067
186,140
128,852
10,399
35,000
30,000
30,000
32,500
–
5,021
13,356
–
13,698
311
259
24,917
25,000
16,470
24,970
24,970
9,608
6,203
8,982
13,944
13,475
9,680
(516)
#
Shares
$
–
–
–
–
–
–
–
999
999
999
999
999
999
Performance
#
Rights
$
–
–
–
–
–
–
325,844
44,526
55,657
55,657
55,657
55,657
Total
$
120,000
25,000
60,000
60,000
60,000
60,000
933,775
209,745
324,274
323,228
321,866
310,257
128,871
(10,331)
2,937,016
2
1
287,899
1,740,516
Resigned 28 November 2012.
Resigned 18 January 2013.
#
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.
2012
Post‐
employment
Long‐term
benefits
Share‐based payments
Short‐term benefits
167,095
582,667
73,253
79,592
5,994
Non‐executive directors
Name
Cash salary &
fees
$
P T Bartels
R Dobinson
P J Jenkins
R A Hazleton
1
Z Peach
2
Executive directors
P R Turvey
120,000
60,000
55,046
60,000
41,284
–
#
Cash bonus
$
–
–
–
–
–
–
Non‐monetary
benefits
$
Superannuation
$
Long service
leave
$
–
–
–
–
–
–
–
–
4,954
–
3,716
17,097
–
–
–
–
–
–
Other Key Management Personnel (group)
J K Fairley
150,000
341,454
40,720
18,764
15,732
B P Rogers
J R Paull
C P Barrett
N J Baade
D J Owen
Totals
M L McColl
1
89,496
176,847
196,652
173,596
174,422
192,303
10,399
30,000
25,000
25,000
25,000
25,000
5,108
11,640
–
13,561
339
–
49,712
24,995
17,699
24,500
24,954
17,307
6,772
8,462
8,388
7,658
1,023
248
1,681,100
290,399
71,368
203,698
48,283
#
Performance
#
Shares
$
–
–
–
–
–
–
–
1,000
1,000
1,000
1,000
1,000
1,000
6,000
Rights
$
–
–
–
–
–
–
128,540
23,008
28,760
28,760
28,760
28,760
28,760
295,348
Total
$
120,000
60,000
60,000
60,000
45,000
17,097
695,210
185,495
281,704
277,499
274,075
255,498
264,618
2,596,196
2
Appointed 1 October 2011.
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.
20
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
20
C P Barrett VP – Business Development
– No fixed term of agreement.
– Base salary, inclusive of superannuation, per annum as at 30 June
2013 of $226,188, 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
2013 of $221,237, 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
(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
2013 of $217,507, 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.
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
2013 of $425,000, to be reviewed annually by the remuneration
and nomination committee.
– A cash bonus up to $200,000 for the year to 30 June 2013 allocated
proportionately on 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
2013 of $142,426 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.
J R Paull VP – Development and Regulatory Affairs
– No fixed term of agreement.
– Base salary, inclusive of superannuation, per annum as at 30 June
2013 of $223,917, 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.
21
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
21
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 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:
Date
exercise‐
able
Grant
date
Expiry
date
Exercise
price
Value per
option at
grant date
%
vested
29 June
2009
29 June
2011
28 June
2014
$0.37
$0.23 100%
Number
of shares issued
on exercise of options
during the year
Intrinsic value1
$
2013
–
100,000
125,000
–
–
100,000
2013
–
116,190
52,400
–
–
120,190
2012
–
–
–
75,000
–
–
2012
–
–
–
72,750
–
–
Name
J K Fairley
B P Rogers
J R Paull
C P Barrett
N J Baade
D J Owen
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
Amount paid per share
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 1.00 years (2012: 1.54 years).
Fair value of options granted
11 July 2012; 13 August 2012
19 June 2013
$0.29
$0.37
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.
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:
No amounts are unpaid on any shares issued on the exercise of
options.
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:
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 options vested or expired (unexercised) in the current or prior
year, or since the end of the year.
No options lapsed during the year as a result of performance
milestones not being met.
22
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
22
Shares and Performance Rights to directors and key management personnel
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:
Number of direct
shares granted
during the year#
2013
–
809
809
809
809
809
809
2013
960,000
40,000
50,000
50,000
50,000
50,000
50,000
2012
–
851
851
851
851
851
851
Name
1
J K Fairley
B P Rogers
J R Paull
C P Barrett
N J Baade
D J Owen
2
M L McColl
1
Number of
performance
rights granted
during the year
Number of shares
issued on the vesting
of performance rights
during the year
Number of
performance rights
lapsed during
the year
2013
125,000
64,000
80,000
80,000
80,000
80,000
80,000
2012
375,000
32,000
40,000
40,000
40,000
40,000
40,000
2013
250,000
2012
–
–
–
–
–
90,000
–
–
–
–
–
–
–
2012
–
–
–
–
–
–
–
2
The value of rights that lapsed in the year were $52,500.
Resigned 18 January 2013. The value performance rights that lapsed in the year were $121,100.
#
Excludes shares issued on the vesting of performance rights.
The value at vesting date of performance rights that vested during 2013 was $864,940 (2012: Nil).
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 to any of the directors or the key management personnel of the group in the current year
were as follows:
Holding Lock
Expiry date
Number
of Rights
Performance
Measure
Value per right at
Grant date
Vesting Date
13 September 2012
19 September 2014
19 September 2015
30 November 2012
30 September 2013
30 September 2014
30 November 2012
30 September 2013
30 September 2014
30 November 2012
30 September 2013
30 September 2014
290,000
100,000
100,000
200,000
Achievement of KPIs
Share Price ≥ $1.86
Share Price ≥ $2.09
Achievement of KPIs
30 November 2012
30 November 2014
30 November 2015
50,000
Continued Employment
30 November 2012
30 November 2014
30 November 2015
30 November 2012
30 November 2014
30 November 2015
50,000
100,000
Index TSR
Index TSR +10%
30 November 2012
30 November 2015
30 November 2016
80,000
Continued Employment
30 November 2012
30 November 2015
30 November 2016
30 November 2012
30 November 2015
30 November 2016
80,000
200,000
Index TSR
Index TSR +10%
grant date % vested
$1.55
$0.19
$0.12
$1.10
$1.10
$0.72
$0.70
$1.10
$0.77
$0.76
Nil
Nil
Nil
Nil
Nil
Nil
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.
23
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
23
Details of remuneration: cash bonuses, shares, performance
rights and options
For each cash bonus and grant of equity included in the tables on
pages 20 to 24, 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.
Cash bonus
Shares
Grant date
value of shares
granted during
20132
Grant date
value of rights
granted during
20132 3
Paid Forfeited
Year
granted
Vested
Forfeited
Performance rights
Financial years in
which rights
may vest
Remuneration
consisting
of shares &
rights4
Name
%
%
J K Fairley
100%
1
–
1
–
1
–
1
–
1
–
1
–
B P
Rogers
J R
Paull
C P
Barrett
N J Baade
D J Owen
M L
5
McColl
1
–
–
–
–
–
–
–
$
–
$
714,970
999
58,900
999
73,625
999
73,625
999
73,625
999
73,625
999
73,625
%
–
–
–
33%
–
–
100%
–
–
100%
–
–
100%
–
–
100%
–
–
100%
–
–
100%
2013
2013
2013
2012
2013
2012
2011
2013
2012
2011
2013
2012
2011
2013
2012
2011
2013
2012
2011
2013
2012
2011
%
–
–
–
66%
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
100%
100%
–
30/06/2016
30/06/2015
30/06/2014
30/06/2013
30/06/2015
30/06/2014
30/06/2013
30/06/2015
30/06/2014
30/06/2013
30/06/2015
30/06/2014
30/06/2013
30/06/2015
30/06/2014
30/06/2013
30/06/2015
30/06/2014
30/06/2013
30/06/2015
30/06/2014
30/06/2013
%
35%
22%
18%
18%
18%
18%
(7%)
The bonuses paid are at the absolute discretion of the board based
on an individual’s performance within the year. There is no unpaid
Share‐
component of the bonuses awarded.
based Payments
2
The value at grant date calculated in accordance with AASB 2
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.
5
Resigned 18 January 2013.
‐ End of remuneration report ‐
24
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
24
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
585,000
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 and up to the date of this report on the
exercise of options. No amounts are unpaid on any of the shares.
Issue price of shares
(Option exercise
price)
Number of shares
issued
Date options
granted
21 August 2007
1 January 2009
Shares under rights
29 June 2009
$0.43
$0.29
$0.37
1,684,809
300,000
209,000
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
25 November
2011
25 November
2013
25 November
2014
467,500
410,000
13 September
2012
19 September
2014
19 September
2015
672,400
600,900
30 November
2012
30 September
2013
30 September
2014
400,000
400,000
30 November
2012
30 November
2014
30 November
2015
200,000
200,000
30 November
2012
30 November
2015
30 November
2016
360,000
360,000
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.
Issue price of shares
(Exercise price of
right)
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.
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
Corporations Act 2001
the non‐audit services is compatible with the general standard of
independence for auditors imposed by the
.
The directors are satisfied that the provision of non‐audit services by
the auditor, as set out below, did not compromise the auditor
independence requirements of the
following reasons:
Corporations Act 2001
for the
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
Professional Accountants
auditor independence as set out in APES 110
Code of Ethics for
.
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.
2013
Assurance Services
$
Audit or review of financial reports of the
Corporations Act 2001
entity or any entity in the group under the
87,600
2012
$
85,000
No other assurance services, taxation or advisory services have been
provided by the auditor in either the current or prior year.
Auditors’ Independence Declaration
Corporations Act 2001
A copy of the auditors’ independence declaration as required under
section 307C of the
Rounding of amounts
is set out on page 26.
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
Date rights granted
2 September 2010
10 November 2011
Insurance of officers
Number of shares
issued
Corporations Act 2001
PricewaterhouseCoopers continues in office in accordance with
section 327 of the
.
$ ‐
$ ‐
717,800
125,000
This report is made in accordance with a resolution of the Directors.
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
AO
Peter T Bartels,
Director
Melbourne, 26 August 2013
25
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
25
AUDITOR’S INDEPENDENCE DECLARATION
26
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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”).
Principle 1: Lay solid foundations for management and oversight
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.
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
2.1.1 Board Composition
out below.
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 2013. The process for these assessments is described in the
Remuneration Report under the heading “Performance Review and
Development” on page 19 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
– The board is to be composed of both executive and non‐executive
company's assets;
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 genders, age groups and cultural and professional
backgrounds who have complementary skills and experience.
– The board is to establish measurable board gender diversity
objectives and assess annually the objectives and the progress in
achieving them.
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
2.1.2 Functions Reserved for the board
the company.
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;
(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
2.1.3 Other Board Responsibilities
senior executives;
– 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 five
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.
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2.3 Directors’ independence
2.6 Commitment
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
Corporations Act 2001
with a substantial shareholding as defined in section 9 of the
.
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 held eight 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 2013, 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 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.
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 composed 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
The board policy is for these separate roles of Chairman and CEO to
be undertaken by separate people.
Details of these directors’ attendance at committee meetings are set
out in the directors’ report on page 17.
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
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
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– 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
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 in relation to
securities of the company 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 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 discussed with each new
employee as part of their induction training, and 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.
Independent of external corporate governance initiatives the
company has embraced a culture of inclusion and equal opportunity
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
Act 2001
the terms of the transaction are in compliance with the
Corporations
and are appropriately disclosed.
across diversity areas recognised as potentially impacting upon
equality in the workplace ‐ gender, national origin, culture, language,
sexual orientation, disability and age.
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 2012‐2013 financial year, and
progress against these objectives are set out below:
Objective: Continue to measure and track diversity of gender, age and
country of origin, 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 were reviewed during the 2011‐2012 financial year to
ensure they are inclusive in nature and consistent with the aims of
the Diversity Policy. Systems have been established to track and
report diversity statistics including gender, country of origin and age.
More than half (54%) of current employees are female, compared
with 58% in July 2012 and 53% July 2011. The table below sets out
the proportion of female employees in the whole organisation, in
senior executive positions and on the board, at July 2013.
Whole
organisation
Senior
Executive
39
21
54%
8
3
38%
Board
6
2
33%
Total
Female
% female
Objective: Identify higher potential female employees for further
career development opportunities and continue to seek professional
development opportunities and initiatives. Continue to encourage
and provide opportunities for female networking and role models.
Progress towards objective: Four female middle managers (24% of
total female employees) attended at least one management training
course during the year, and one female staff member has been
promoted into a middle management role. 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 2012/2013 financial year.
Objective: Family friendliness –
(i) Maintain initiatives to smooth transitions before, during and after
parental leave, and to retain employees after they have taken
parental leave;
(ii) Introduce a formal policy reflecting the company’s established
practices in relation to parental leave.
Progress towards objective: Where possible, the company provides
flexible working hours and part time arrangements, and staff are
encouraged to approach management to discuss their particular
needs before and after parental leave. A Parental Leave policy was
developed and introduced during the year.
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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 13 to 17. 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;
– 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 been
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 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
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).
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, a summary of
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
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committee, the CEO, CFO, Company Secretary, and the senior
management team.
The CEO and the CFO have made the following certifications to the
board for the year ended 30 June 2013:
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.
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.
Principle 8: Remunerate fairly and responsibly
– 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.
The company has established a remuneration and nomination
committee consisting of three independent non‐executive directors.
Details regarding composition, meetings and charter are set out in
section 2.11 of this Corporate Governance Statement.
and relevant executive. Further information on directors’ and
executives’ remuneration, including principles used to determine
remuneration, is set out in the Remuneration Report on
pages 18 to 24.
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
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.
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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
33
34
35
36
37
38
66
67
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.
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 11 and in the
operating and financial review in the directors’ report on pages 15 to
17, which are not part of this financial report.
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
The financial statements were authorised for issue by the directors
on 26 August 2013. 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.
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
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Consolidated income statement
For the year ended 30 June 2013
Revenue from continuing operations
Other income
Administration expense
Research and development expense
Loss before income tax
Finance costs
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
2013
$'000
2,429
5
(4,149)
(3,505)
(9)
(5,229)
‐
(5,229)
$
($0.02)
($0.02)
Consolidated
2012
$'000
2,744
160
(4,466)
(12,088)
(8)
(13,658)
‐
(13,658)
$
($0.05)
($0.05)
Notes
5
5
6
6
7
24
24
The above consolidated income statement should be read in conjunction with the accompanying notes.
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STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
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Consolidated statement of comprehensive income
For the year ended 30 June 2013
Loss for the year
Notes
Other comprehensive income (loss)
Items that may be reclassified to profit or loss
Other comprehensive income (loss)
Foreign exchange differences on translation of foreign operations
15
Total comprehensive income (loss) for the year attributable to
members of Starpharma Holdings Limited
2013
$'000
(5,229)
713
713
(4,516)
Consolidated
2012
$'000
(13,658)
421
421
(13,237)
The above statement of consolidated comprehensive income should be read in conjunction with the accompanying notes.
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Consolidated balance sheet
As at 30 June 2013
Current Assets
Notes
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
8
9
10
11
12
13
13
14
15
16
The above consolidated balance sheet should be read in conjunction with the accompanying notes.
2013
$'000
33,840
5,492
39,332
411
8,807
9,218
48,550
1,696
25
627
111
2,459
75
48
123
2,582
45,968
140,081
3,502
(97,615)
45,968
Consolidated
2012
$'000
42,812
2,053
44,865
414
8,989
9,403
54,268
4,492
40
506
397
5,435
100
82
182
5,617
48,651
139,171
1,866
(92,386)
48,651
35
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
35
Consolidated statement of changes in equity
For the year ended 30 June 2013
Balance at 1 July 2012
Loss for the year
Other comprehensive income
Foreign exchange differences on translation of
Total comprehensive income (loss) for the
foreign operations
year
Transactions with owners, recorded directly
in equity
Contributions of equity, net of transaction costs
Employee share plans
Total transactions with owners
Employee performance rights plan
Balance at 30 June 2013
For the year ended 30 June 2012
Balance at 1 July 2011
Loss for the year
Other comprehensive income
Foreign exchange differences on translation of
Total comprehensive income (loss) for the
foreign operations
year
Transactions with owners, recorded directly
in equity
Contributions of equity, net of transaction costs
Employee share plans
Total transactions with owners
Employee performance rights plan
Balance at 30 June 2012
15
14
14
15
Notes
15
14
14
15
Contributed
capital
$'000
139,171
‐
‐
‐
878
32
‐
910
$'000
1,866
‐
713
713
‐
‐
923
923
Reserves
Accumulated
losses
$'000
(92,386)
(5,229)
Consolidated
Total
equity
$'000
48,651
(5,229)
‐
713
(5,229)
(4,516)
‐
‐
‐
‐
878
32
923
1,833
140,081
3,502
(97,615)
45,968
Notes
Contributed
capital
$'000
105,399
Reserves
$'000
1,022
Accumulated
losses
$'000
(78,728)
Consolidated
Total
equity
$'000
27,693
‐
‐
‐
33,746
26
‐
33,772
‐
(13,658)
(13,658)
421
421
‐
‐
423
423
‐
421
(13,658)
(13,237)
‐
‐
‐
‐
33,746
26
423
34,195
139,171
1,866
(92,386)
48,651
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
36
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
36
Consolidated statement of cash flows
For the year ended 30 June 2013
Cash flow from operating activities
Notes
Receipts from trade and other debtors (inclusive of GST)
Grant income and R&D tax incentives (inclusive of GST)
Payments to suppliers and employees (inclusive of GST)
Interest received
Interest paid
Cash flow from investing activities
Net cash outflows from operating activities
23
Payments for property, plant and equipment
Cash flow from financing activities
Net cash outflows from investing activities
Proceeds from issue of shares
Share issue transaction costs
Lease repayments
Net increase (decrease) in cash and cash equivalents held
Net cash inflows from financing activities
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
Effects of exchange rate changes on cash and cash equivalents
2013
$'000
423
5,453
(17,270)
1,609
(10)
(9,795)
(156)
(156)
878
‐
(50)
828
(9,123)
42,812
151
33,840
Consolidated
2012
$'000
1,141
405
(12,916)
1,608
(8)
(9,770)
(133)
(133)
35,167
(1,422)
(80)
33,665
23,762
18,918
132
42,812
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
37
37
Notes to the consolidated financial statements
30 June 2013
Contents
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.
Summary of significant accounting policies
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
Non‐current assets – Property, plant and equipment
Non‐current assets – Intangible assets
Current liabilities – Trade and other payables
Current and non‐current liabilities – Borrowings
Contributed equity
Reserves
Accumulated losses
Key management personnel disclosures
Remuneration of auditors
Contingencies
Commitments
Subsidiaries
Events occurring after the balance sheet date
Reconciliation of profit after income tax to net cash inflow from operating activities
Earnings per share
Share‐based payments
Related party transactions
27.
Parent entity financial information
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
38
38
39
44
45
45
46
46
46
48
49
50
51
52
52
53
54
55
55
58
58
58
59
59
60
60
60
64
65
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
Corporations Act 2001
These general purpose financial statements have been prepared in
accordance with Australian Accounting Standards and
Interpretations issued by the Australian Accounting Standards board
. Starpharma Holdings Limited is a for‐
and the
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
2012 affected any of the amounts recognised in the current period or
any prior period and are not likely to affect future periods. However,
amendments made to AASB 101 Presentation of Financial Statements
effective 1 July 2012 now require the statement of comprehensive
income to show the items of comprehensive income grouped into
those that are not permitted to be reclassified to profit or loss in a
future period and those that may have to be reclassified if certain
conditions are met.
(iii) Early adoption of standards
The group has elected to apply the following pronouncement to the
Amendments to Australian Accounting Standards
annual reporting period beginning 1 July 2012:
arising from Annual Improvements 2009—2011 Cycle
AASB 2012‐5
Accounting Policies,
This includes applying the revised pronouncement to the
Changes in Accounting Estimates and Errors
comparatives in accordance with AASB 108
. None of the items in the
financial statements had to be restated as a result of applying this
standard. However, the amendments removed the requirement to
provide additional comparative information in all relevant notes
where line items in the financial statements are affected as a result of
a retrospective restatement (eg because of an error). Following the
amendments, it is now sufficient if an entity includes a third balance
sheet and explains the impact of the restatement on individual line
items in the note that sets out the reasons for the restatement. There
is no impact to the financial report in applying this amendment.
(iv) Historical cost convention
These financial statements have been prepared under the historical
cost convention, as modified by the revaluation of available‐for‐sale
financial assets, financial assets and liabilities (including derivative
instruments) at fair value through profit or loss, certain classes of
property, plant and equipment and investment property.
(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.
(vi) Going Concern
For the year ended 30 June 2013, the consolidated entity has
incurred losses of $5,229,000 (2012: $13,658,000) and experienced
net cash outflows of $9,795,000 from operations (2012: $9,770,000),
as disclosed in the balance sheet and statement of cash flows,
respectively. This is consistent with the consolidated entity’s
strategic plans and the directors are satisfied regarding the
availability of working capital for the period up to at least August
2014. 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 2013 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
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.
(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
39
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
39
all resulting exchange differences are recognised in other
comprehensive income.
deferred tax asset is recognised for unclaimed tax credits that are
carried forward as deferred tax assets.
(h) Leases
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.
(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
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.
(i) Investment allowances and similar tax incentives
Companies within the group may be entitled to claim special tax
deductions for investments in qualifying assets or in relation to
qualifying expenditure (eg investment allowances). The group
accounts for such allowances as tax credits, which means that the
allowance reduces income tax payable and current tax expense. A
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 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 with
financial institutions, and other short‐term, highly liquid investments
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 to 60 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
90 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.
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
40
40
(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 2 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.
(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 13 years.
(iii) Research and development
Research expenditure is recognised as an expense as incurred. Costs
incurred on development projects (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)
are recognised as intangible assets when it is probable that the
project will, after considering its commercial and technical feasibility
and adequate resources are available to complete 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
expenditures that do not meet these criteria are recognised as an
expense as incurred. Development costs previously recognised as an
expense are not recognised as an asset in a subsequent period.
Capitalised development costs are recorded as intangible assets and
amortised from the point at which the asset is ready for use on a
straight‐line basis over its useful life. 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) Short‐term obligations
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
41
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
41
using market yields at the end of the reporting period on 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.
(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) 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.
(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
Financial Instruments, AASB 2009‐11 Amendments to
Certain new accounting standards and interpretations have been
published that are not mandatory for 30 June 2013 reporting
periods. The group’s assessment of the impact of these new
standards and interpretations is set out below.
(i)
Australian Accounting Standards arising from AASB 9, AASB 2010‐7
Amendments to Australian Accounting Standards arising from AASB 9
(December 2010) and AASB 2012‐6 Amendments to Australian
Accounting Standards – Mandatory Effective Date of AASB 9 and
Transition Disclosures
AASB 9
Financial Instruments
(effective from 1 January 2015)
AASB 9
measurement and derecognition of financial assets and financial
liabilities. The standard is not applicable until 1 January 2015 but is
available for early adoption.
addresses the classification,
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
Financial
loss and the group does not have any such liabilities. The
derecognition rules have been transferred from AASB 139
42
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
42
Instruments: Recognition and Measurement
and have not been
changed. The group has not yet decided when to adopt AASB 9.
(ii)
Arrangements
AASB 10
Joint
Disclosure of Interests in Other Entities
Consolidated Financial Statements
Separate Financial Statements
, AASB 11
, AASB 12
Investments in Associates and Joint Ventures
revised AASB 127
Amendments to Australian Accounting Standards arising from the
Consolidation and Joint Arrangements Standards
Amendments to Australian Accounting Standards – Transition
Guidance and Other Amendments
, AASB 2011‐7
, AASB 128
and AASB 2012‐10
,
(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.
, and
. The core
Consolidated and Separate Financial Statements
AASB 10 replaces all of the guidance on control and consolidation in
Consolidation – Special Purpose Entities
AASB 127
Interpretation 12
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. The group does not expect the new
standard to have a significant impact on its composition.
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 for 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 11 will not
have any impact on the amounts recognised in its financial
statements.
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. Application of this standard by the group will not affect any of
the amounts recognised in the financial statements, but will impact
the type of information disclosed in relation to the group’s
investments.
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 group will adopt the new standards from their operative date.
They will therefore be applied in the financial statements for the
annual reporting period ending 30 June 2014. They are not expected
to have any impact on the group’s financial statements.
Fair Value Measurement
(iii)
to Australian Accounting Standards arising from AASB 13
and AASB 2011‐8
AASB 13
Amendments
(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 will
adopt the new standard from its operative date, which means that it
would be first applied in the annual reporting period ending
30 June 2014.
(iv)
Amendments to Australian Accounting Standards
Employee Benefits
Revised AASB 119
and AASB 2011‐10
arising from AASB
119 (September 2011)
In September 2011, the AASB released a revised standard on
accounting for employee benefits. It requires the recognition of all re‐
measurements of defined benefit liabilities/assets immediately in
other comprehensive income (removal of the so‐called ‘corridor’
method), the immediate recognition of all past service cost in profit
or loss and the calculation of a net interest expense or income by
applying the discount rate to the net defined benefit liability or asset.
This replaces the expected return on plan assets that is currently
included in profit or loss. The standard also introduces a number of
additional disclosures for defined benefit liabilities/assets and could
affect the timing of the recognition of termination benefits. The
amendments will have to be implemented retrospectively. The Group
will apply the new standard when it becomes operative, being from 1
July 2013. There is not expected to have any impact on the group’s
financial statements.
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 when its right to receive the
dividend is established.
(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.
43
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
43
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.
Cash and cash equivalents
Trade and other receivables
Trade and other payables
Group Sensitivity
(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 using an
US exchange rate of $0.9275 was as follows:
Consolidated
2013
US
$’000
2,976
99
299
2012
US
$’000
3,059
10
3,969
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.
Consolidated
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%
(ii) Cash Flow Interest Rate Risk
2013
$’000
(266)
325
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 deposits. Refer to note 8 for additional information.
2013
$’000
32,337
Term Deposits and deposits at call
Group Sensitivity
2012
$’000
(131)
108
Consolidated
2012
$’000
41,357
At 30 June 2013, 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 $162,000 higher or lower (2012 ‐ change of 50 bps: $209,000 higher/lower) due to either higher or lower
interest income from cash or cash equivalents.
(b) Credit risk
(c) Liquidity 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
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.
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.
44
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
44
(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 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
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 3–13 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 2013 is $8,807,000 (2012: $8,989,000).
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
4. Segment information
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 not recognised deferred tax assets or liabilities,
including carried forward losses 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.
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 2013 the group has recorded a
contra research and development expense of $8,704,000 (2012:
$1,323,000). Of the 2013 total, $4,071,000 relates to 2012
expenditure not previously booked in 2012 due to the uncertainty of
its eligibility. Subsequent to the 2012 results, Starpharma received an
advance finding from AusIndustry that cover a 3 year period from
1 July 2011.
(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.
The group has determined that on the basis of internal reporting and
monitoring to the Chief Executive Officer, who is the chief operating
decision maker, the Group operates in one business segment, being
the discovery, development and commercialisation of dendrimers for
pharmaceutical, life science and other applications.
There has been a change to the presentation of segment disclosures
to better reflect the fact that the Group has only one
operating segment.
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
45
45
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
2013
$’000
840
1,569
20
2,429
5
–
5
2,434
Consolidated
2012
$’000
881
1,819
44
2,744
5
155
160
2,904
Total revenue and other income for the year was $2,434,000, a reduction of $470,000 from the previous year, on lower interest revenue earned on
cash deposits and grant income from the US National Institutes of Health.
6. Expenses
Loss from continuing operations before income tax expense includes the
following items:
1
R&D Tax Incentive (contra expense)
Depreciation
Amortisation
Rental expense on operating leases
Defined contribution superannuation expense
1
iv)
Refer to Note 3 a)
7. Income tax expense
for further information.
(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
2013
$’000
(8,704)
159
891
444
402
2013
$’000
–
–
–
–
–
–
–
–
Consolidated
2012
$’000
(1,323)
134
1,008
329
385
Consolidated
2012
$’000
–
–
–
–
–
–
–
–
46
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
46
(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% (2012: 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
2013
$’000
(5,229)
(1,569)
477
170
287
(74)
202
26
(179)
660
–
65,680
19,704
Consolidated
2012
$’000
(13,658)
(4,097)
485
206
134
(102)
91
24
57
3,202
–
73,290
21,987
Subsequent to the 30 June 2012 results, certain overseas R&D expenditure was determined to be eligible under the 45% refundable tax incentive
program. Under the program, eligible R&D expenditure is then not deductable for income tax purposes. The decrease in tax losses in the 2013
financial year reflects this change.
(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
(e) Deferred tax liabilities
Deferred tax liabilities comprises temporary differences attributable to:
Intangibles
Sundry items
Total deferred tax liabilities
Set‐off of deferred tax liabilities pursuant to set‐off provisions
Net deferred tax liabilities
Deferred tax liabilities expected to be settled within 12 months
Deferred tax liabilities expected to be settled after more than 12 months
20,304
6,185
1,659
111
1,770
(1,770)
–
111
1,659
1,770
5,001
1,420
1,710
120
1,830
(1,830)
–
120
1,710
1,830
Deferred tax assets and deferred tax liabilities have been set off as
there is a legally recognised right to set off current tax assets and
liabilities and the deferred tax assets and liabilities relate to income
taxes levied by the same taxation authority. Deferred tax assets
mainly comprises of temporary differences attributable to tax losses.
Potential future income tax benefits attributable to tax losses carried
forward have not been brought to account at 30 June 2013 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 2013 which it believes
will be satisfied.
47
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
47
8. Current assets – Cash and cash equivalents
Cash at bank and on hand
Deposits at call
Cash at bank and on hand
Cash not available
2013
$’000
1,503
32,337
33,840
Consolidated
2012
$’000
1,455
41,357
42,812
The cash is bearing floating interest rates based on current
Deposits at call
bank rates.
There is $458,000 of cash not available for use due to restrictions
associated with a finance lease and credit card facility which is
Interest rate risk
guaranteed by term deposits (2012: $300,000).
The terms and conditions of the deposits with the counterparties
allow the group to withdraw funds on demand.
30 June 2013
Floating
Interest
rate
With the exception of loans to controlled entities, current receivables
are non‐interest bearing.
Fixed interest maturing
Financial Assets
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
Cash & deposits
Receivables
8
9
Weighted average
interest rate
Financial Liabilities
Payables
Borrowings
12
13
Weighted average
interest rate
2,427
30,004
–
–
2,427
2.8%
30,004
4.0%
–
–
–
–%
–
–
–
–%
–
–
–
–%
–
–
–
–%
–
–
–
–%
–
25
25
8.2%
–
27
27
8.2%
–
30
30
8.2%
–
18
18
8.2%
–
–
–
8.2%
–
–
–
–%
–
–
–
–%
1,409
33,840
5,492
5,492
6,901
–%
39,332
1,696
1,696
–
100
1,696
–%
1,796
N/A
5,492
5,492
1,696
100
1,796
48
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
48
30 June 2012
Floating
Interest
rate
Fixed interest maturing
Financial Assets
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
Total
$’000
Contractual
cash
flows
Cash & deposits
Receivables
8
9
Weighted average
interest rate
Financial Liabilities
Payables
Borrowings
12
13
1,608
40,135
–
–
1,608
2.7%
40,135
5.3%
–
–
–
–%
–
–
–
–%
–
–
–
–%
–
–
–
–%
–
–
–
–%
–
40
40
9.0%
–
25
25
8.2%
–
27
27
8.2%
–
30
30
8.2%
–
18
18
8.2%
Weighted average
interest rate
9. Current assets – Trade and other receivables
Trade and grant receivables
Interest receivables
Prepayments
Other receivables
–
–
–
–%
–
–
–
–%
1,069
42,812
2,053
2,053
3,122
–%
44,865
4,492
4,492
–
140
4,492
–%
4,632
N/A
2,053
2,053
4,492
140
4,632
2013
$’000
4,869
354
178
91
5,492
Consolidated
2012
$’000
1,436
393
136
88
2,053
Trade and grant receivables
Impaired receivables
Trade and grant receivables primarily comprise of $4,632,000 of
expenditure reimbursable under the Australian Government’s R&D
tax incentive scheme. Other trade receivables are associated with
research and development projects and are subject to normal terms
Credit risk
of settlement within 30 to 90 days.
As at 30 June 2013, there were no trade and grant receivables that
were past due (2012: nil). No receivables are considered impaired at
30 June 2013 (2012: nil) other than from subsidiaries within
Other receivables
the group.
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.
Other receivables comprise sundry debtors and GST claimable and
are subject to normal terms of settlement within 30 to 90 days.
49
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
49
10. Non‐current assets – Property, plant and equipment
Consolidated
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
Year ended 30 June 2013
Opening net book amount
Additions
Disposals
Depreciation and amortisation
Closing net book amount
At 30 June 2013
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
2,042
(1,872)
170
170
131
(12)
(54)
235
2,138
(1,903)
235
235
152
(1)
(88)
298
2,116
(1,818)
298
1,185
(1,147)
38
38
2
–
(18)
22
1,187
(1,165)
22
22
5
–
(22)
5
1,193
(1,188)
5
272
(200)
72
72
147
–
(62)
157
419
(262)
157
157
–
–
(49)
108
419
(311)
108
3,499
(3,219)
280
280
280
(12)
(134)
414
3,744
(3,330)
414
414
157
(1)
(159)
411
3,728
(3,317)
411
50
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
50
11. Non‐current assets – Intangible assets
Consolidated
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
Year ended 30 June 2013
Opening net book amount
Exchange differences
Depreciation and amortisation
Closing net book amount
At 30 June 2013
Cost
Accumulated depreciation and amortisation
Net book amount
(a) Impairment tests for goodwill
Goodwill is tested annually for impairment based on the higher of
fair value less costs to sell and value in use 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.
Patents & Licences
$’000
Goodwill
$’000
Total Intangibles
$’000
14,854
(6,655)
8,199
8,199
337
(1,008)
7,528
15,417
(7,889)
7,528
7,528
564
(891)
7,201
16,507
(9,306)
7,201
1,387
–
1,387
1,387
74
–
1,461
1,461
–
1,461
1,461
145
–
1,606
1,606
–
1,606
16,241
(6,655)
9,586
9,586
411
(1,008)
8,989
16,878
(7,889)
8,989
8,989
709
(891)
8,807
18,113
(9,306)
8,807
(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 2013, goodwill is
not considered to be impaired at the end of the reporting period.
(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
indicators of impairment at 30 June 2013 and determined that there
is no indication that the asset is impaired.
51
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
51
12. Current liabilities – Trade and other payables
Trade payables and accruals
Other payables
Trade payables and accruals
2013
$’000
1,208
488
1,696
Consolidated
2012
$’000
4,156
336
4,492
The majority of trade payables are related to expenditure associated with the Group’s research and development 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.
2013
Floating
Interest rate
Fixed interest rate
1 year
or
less
$’000
8.2%
25
1 year
or
less
$’000
9.0%
40
–%
–
Floating
Interest
rate
–%
–
Notes
20
Notes
20
Over 1–2
years
$’000
Over 2–3
years
$’000
Over 3–4
years
$’000
Over 4–5
years
$’000
Over 5
years
$’000
8.2%
27
8.2%
30
8.2%
18
8.2%
–
–%
–
Total
$’000
100
Fixed interest rate
Over 1–2
years
$’000
Over 2–3
years
$’000
Over 3–4
years
$’000
Over 4–5
years
$’000
Over 5
year
s
$’000
8.2%
25
8.2%
27
8.2%
30
8.2%
18
–%
–
Total
$’000
140
Lease Liabilities
Weighted average interest rate
2012
Lease Liabilities
Weighted average interest rate
52
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
52
14. Contributed equity
(a) Share Capital
Share Capital
Ordinary shares – fully paid
(b) Movements in ordinary share capital
Consolidated
Consolidated
2013
Shares
2012
Shares
2013
$’000
2012
$’000
283,814,948
140,081
280,802,451
139,171
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
21 Nov 2011
Share placement
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
247,743,578
40,000
13,000
140,000
10,000
80,000
29,767,442
10,000
2,791,305
40,000
22,126
75,000
10,000
10,000
20,000
16 Apr 2012
Proceeds on exercise of employee options
Balance at 30 June 2012
30,000
280,802,451
$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
139,171
Date
Details
Number of shares
Issue Price
$’000
1 Jul 2012
280,802,451
139,171
11 Jul 2012
Proceeds on exercise of options
11 Jul 2012
Proceeds on exercise of employee options
16 Jul 2012
Proceeds on exercise of options
13 Aug 2012
Proceeds on exercise of employee options
23 Aug 2012
Proceeds on exercise of options
13 Sep 2012
Employee performance rights plan share issue
13 Sep 2012
Proceeds on exercise of employee options
5 Oct 2012
Employee performance rights plan share issue
18 Jan 2013
Employee share plan ($1,000) issue
260,660
150,000
477,290
150,000
946,859
717,800
10,000
125,000
25,888
19 Jun 2013
Balance at 30 June 2013
Proceeds on exercise of employee options
283,814,948
149,000
$0.43
$0.29
$0.43
$0.29
$0.43
$ –
$0.37
$ –
$1.24
$0.37
113
43
207
43
412
–
4
–
32
140,081
56
53
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
53
(c) Ordinary shares
(f) Options
As at 30 June 2013 there were 283,814,948 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. Ordinary shares have no par value and the company does not
have a limited amount of authorised capital. 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) 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.
15. Reserves
(a) Reserves
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.
(g) 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. In order to maintain or adjust the capital
structure, the group may adjust the amount of dividends paid to
shareholders, return capital to shareholders, issue new shares or sell
assets.
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
(c) Nature and purpose of reserves
(i) Share‐based payments reserve
2013
$’000
4,188
(2,901)
2,215
3,502
2013
$’000
3,265
‐
923
4,188
(3,614)
713
(2,901)
Consolidated
2012
$’000
3,265
(3,614)
2,215
1,866
Consolidated
2012
$’000
2,842
‐
423
3,265
(4,035)
421
(3,614)
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.
54
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
54
16. Accumulated Losses
Accumulated losses balance at 1 July
Net loss for the year
Accumulated losses balance at 30 June
17. Key management personnel disclosures
(a) Key management personnel compensation
Short‐term employee benefits
Post‐employment benefits
Other long term benefits
Share‐based payments
2013
$’000
(92,386)
(5,229)
(97,615)
2013
$
2,101,668
167,095
79,592
588,661
2,937,016
Consolidated
2012
$’000
(78,728)
(13,658)
(92,386)
Consolidated
2012
$
2,042,867
203,698
48,283
301,348
2,596,196
Detailed remuneration disclosures are provided in the remuneration report on pages 18 to 24.
(b) Equity instrument disclosures relating to key management
personnel
(i) Options provided as remuneration and shares issued on exercise of
(ii) Rights provided as remuneration and shares issued on vesting of
such options
such rights
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.
Details of rights provided as remuneration and shares issued on the
vesting of such rights, together with terms and conditions of the
rights, 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.
2013
Name
Directors of Starpharma Holdings Limited
Balance at the
start of the year
Granted during
the year as
compensation
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
J R Paull
C P Barrett
N J Baade
D J Owen
1
M L McColl
1
200,000
125,000
125,000
125,000
225,000
–
Resigned 18 January 2013
–
–
–
–
–
–
–
–
100,000
125,000
–
–
100,000
–
–
–
–
–
–
–
–
–
–
100,000
100,000
–
125,000
125,000
125,000
–
–
125,000
125,000
125,000
–
–
–
–
–
–
–
–
55
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
55
2012
Name
Directors of Starpharma Holdings Limited
Balance at the
start of the year
Granted during
the year as
compensation
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
J R Paull
C P Barrett
N J Baade
D J Owen
200,000
125,000
200,000
125,000
225,000
–
–
–
–
–
–
–
–
–
–
75,000
–
–
–
–
–
–
–
–
–
–
–
–
200,000
125,000
125,000
125,000
225,000
–
200,000
125,000
125,000
125,000
225,000
–
–
–
–
–
–
–
–
M L McColl
#
Performance rights holdings
–
Other Changes during the year relate to the expiry of options.
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.
2013
Except for J K Fairley, no other director held share rights in the
current or prior year. J K Fairley was granted 960,000 performance
rights to ordinary shares on approval by shareholders at the 2012
annual general meeting.
Directors of Starpharma Holdings Limited
Name
Balance at the
start of the year
Granted during
the year as
compensation
J K Fairley
Other key management personnel of the group
375,000
960,000
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
125,000
(250,000)
960,000
–
960,000
B P Rogers
J R Paull
C P Barrett
N J Baade
D J Owen
1
96,000
120,000
120,000
120,000
120,000
40,000
50,000
50,000
50,000
50,000
64,000
80,000
80,000
80,000
80,000
M L McColl
1
Resigned 18 January 2013
#
Other Changes during the year relate to the forfeit of performance rights
120,000
50,000
80,000
2012
–
–
–
–
–
(90,000)
72,000
90,000
90,000
90,000
90,000
–
–
–
–
–
–
–
72,000
90,000
90,000
90,000
90,000
–
Directors of Starpharma Holdings Limited
Name
Balance at the
start of the year
Granted during
the year as
compensation
J K Fairley
Other key management personnel of the group
–
375,000
B P Rogers
J R Paull
C P Barrett
N J Baade
D J Owen
M L McColl
#
Share holdings
64,000
80,000
80,000
80,000
80,000
80,000
32,000
40,000
40,000
40,000
40,000
40,000
Other Changes during the year relate to the forfeit of performance rights
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
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.
56
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
56
2013
Directors of Starpharma Holdings Limited
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
Ordinary Shares
P T Bartels
J K Fairley
1
R Dobinson
P J Jenkins
R A Hazleton
Z Peach
232,930
1,649,197
–
1,487,462
142,616
2,000
P R Turvey
Other key management personnel of the group
30,000
Ordinary Shares
B P Rogers
J R Paull
C P Barrett
N J Baade
D J Owen
2
M L McColl
1
2
Resigned 28 November 2012.
Resigned 18 January 2013.
2012
44,640
15,022
78,459
121,585
53,459
2,041
–
–
–
–
–
–
–
809
809
809
809
809
809
–
–
–
–
–
–
–
100,000
125,000
–
–
100,000
–
–
125,000
–
–
–
–
–
64,000
80,000
80,000
80,000
80,000
80,000
100,000
50,000
–
50,000
15,000
1,000
17,000
–
–
–
–
(123,352)
(82,500)
332,930
1,824,197
–
1,537,462
157,616
3,000
47,000
209,449
220,831
159,268
202,394
110,916
350
Directors of Starpharma Holdings Limited
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
Ordinary Shares
P T Bartels
J K Fairley
R Dobinson
P J Jenkins
R A Hazleton
1
Z Peach
2
129,804
1,819,821
–
1,426,000
142,616
–
P R Turvey
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
1
2
Appointed 1 October 2011.
Appointed 19 March 2012.
41,455
12,608
2,608
132,608
52,608
1,190
–
–
–
–
–
–
–
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
2,000
30,000
2,334
1,563
–
(11,874)
–
–
44,640
15,022
78,459
121,585
53,459
2,041
57
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
57
18. Remuneration of auditors
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
No other audit services were performed in the current or prior year.
19. Contingencies
2013
$
87,600
87,600
Consolidated
2012
$
85,000
85,000
The company has no contingent assets or liabilities at 30 June 2013 (2012: nil).
20. Commitments
(a) Capital Commitments
There is no capital expenditure contracted for, not recognised as
liabilities at the reporting date (2012: nil).
(b) Lease Commitments
Operating leases
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
The group leases laboratory and offices under a lease until 31 August
2015.
Consolidated
2013
$’000
366
450
–
816
2012
$’000
349
71
–
420
58
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
58
Finance Leases
The group leases plant and equipment under a finance leases expiring within four years.
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
2013
$’000
32
84
–
116
(16)
100
25
75
100
Consolidated
2012
$’000
50
116
–
166
(26)
140
40
100
140
The weighted average interest rate implicit in the lease is 8.2% (2012: 8.4%).
(c) Expenditure Commitments
(d) Termination 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.
21. Subsidiaries
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.
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).
Equity Holding
Name of entity
Starpharma Pty Limited
Angiostar Pty Limited
Viralstar Pty Limited
Dendritic Nanotechnologies Inc.
22. Events occurring after the balance sheet date
Country of
Incorporation
Class of Shares
Australia
Australia
Australia
USA
Ordinary
Ordinary
Ordinary
Ordinary
There are no significant events occurring since 30 June 2013
that have significantly affected or may significantly affect the
operations of the group, the results of those operations, or
the state of the group.
2013
%
100.00%
100.00%
100.00%
100.00%
2012
%
100.00%
100.00%
100.00%
100.00%
59
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
59
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
2013
$’000
(5,229)
1,050
(151)
955
(1)
(3,424)
(2,796)
86
(285)
(9,795)
2013
$
(0.02)
(0.02)
(5,229)
283,281,880
Consolidated
2012
$’000
(13,658)
1,142
(132)
448
(13)
(989)
3,266
116
50
(9,770)
Consolidated
2012
$
(0.05)
(0.05)
(13,658)
267,652,960
As at 30 June 2013 the company had on issue 635,000 (30 June 2012:
2,778,809) share options and 1,970,900 (30 June 2012: 1,550,300)
performance rights that are not considered 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.
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.
25. Share‐based payments
Options
(a) Employee Option Plan
(b) Individual Option Deeds
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. No options
were granted in the current or prior year.
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 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.
(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. The remaining balance of
1,684,809 options was exercised before the expiry date.
60
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
60
Set out below are summaries of options under the schemes:
2013
Grant Date
Expiry Date
Consolidated and parent entity
Exercise
Price
Balance
at start of
the year
Exercised
during
the year
Forfeited
during
the year
$
Number
Number
Number
Expired
during
the year
Number
Balance
at end of
the year
Exercisable at
end of
the year
Number
Number
c
21 Aug 2007
a
1 Jan 2009
a
22 Aug 2012
28 Aug 2012
29 Jun 2009
28 Jun 2014
$0.43
1,684,809
1,684,809
$0.29
$0.37
300,000
794,000
300,000
159,000
Total
2,778,809
2,143,809
–
–
–
–
–
–
–
–
–
–
–
–
635,000
635,000
635,000
635,000
Weighted average exercise price
$0.40
$0.41
$ –
$ –
$0.37
$0.37
2012
Grant Date
Expiry Date
Consolidated and parent entity
c
21 Aug 2007
a
31 Oct 2007
a
1 Jan 2009
b
1 Jan 2009
a
22 Aug 2012
7 Aug 2011
28 Aug 2012
28 Aug 2012
Exercise
Price
Balance
at start of
the year
Exercised
during
the year
Forfeited
during
the year
$
Number
Number
Number
Expired
during
the year
Number
Balance
at end of
the year
Exercisable at
end of
the year
Number
Number
$0.43
1,684,809
$0.50
$0.29
$0.29
30,000
395,000
20,000
–
30,000
95,000
20,000
–
–
–
–
–
–
–
–
–
–
–
–
1,684,809
1,684,809
–
–
300,000
300,000
–
–
794,000
794,000
2,778,809
2,778,809
29 Jun 2009
28 Jun 2014
$0.37
1,114,000
320,000
Total
3,243,809
465,000
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.
Options granted under a share placement.
c
No options were granted in the current or prior year.
The weighted average share price at the date of exercise of options
exercised during the year ended 30 June 2013 was $1.44
(2012: $1.26).
(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
Shares
The weighted average remaining contractual life of share options
outstanding at the end of the period was 1.00 year (2012: 0.67
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.
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.
(a) Employee Share Plan ($1,000 Plan)
(b) Fair value of shares granted
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.
The weighted average assessed fair value at grant date of employee
shares granted during the year ended 30 June 2013 was $1.235
(2012: $1.175 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.
61
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
61
Information used in assessing the fair value of shares granted during the year ended 30 June 2013 is as follows:
Share grant date
18 January 2013
Number of shares granted
Share price at grant date
Assessed fair value
25,888
$1.235
$1.235
Information used in assessing the fair value of shares granted during the year ended 30 June 2012 is as follows:
Share grant date
24 January 2012
Number of shares granted
Share price at grant date
Assessed fair value
Performance Rights
22,126
$1.175
$1.175
(a) Employee Performance Rights Plan
(b) Fair value of performance rights granted
In 2010 the board approved the introduction of the Starpharma
Employee Performance Rights Plan, which was subsequently
approved by shareholders at the 2011 annual general meeting. All
executives and staff, including the CEO, 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.
The weighted average assessed fair value at grant date of
performance rights granted during the year ended 30 June
2013 was $1.08 per right (2012: $0.81). There were
1,682,400 performance rights granted in the current year
(2012: 842,500). The estimated fair value at grant date is
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.
Set out below are summaries of performance rights:
2013
Grant Date
Vesting
Date
Holding
Lock
Date
2 Sep 2010
31 Aug 2012
31 Aug 2013
10 Nov 2011
30 Sep 2012
30 Sep 2013
25 Nov 2011
25 Nov 2013
25 Nov 2014
13 Sep 2012
30 Nov 2012
19 Sep 2014
19 Sep 2015
30 Sep 2013
30 Sep 2014
30 Nov 2012
30 Nov 2014
30 Nov 2015
30 Nov 2012
30 Nov 2015
30 Nov 2016
15 Jan 2013
15 Jan 2015
15 Jan 2016
Balance
at start of
the year
Number
717,800
375,000
457,500
–
–
–
–
–
Granted
during
the year
Number
–
–
–
672,400
400,000
200,000
360,000
50,000
Converted
during
the year
Number
717,800
125,000
–
–
–
–
–
–
Forfeited
during
the year
Number
–
250,000
47,500
71,500
–
–
–
50,000
Balance
at end of
the year
Number
–
–
410,000
600,900
400,000
200,000
360,000
–
1,550,300
1,682,400
842,800
419,000
1,970,900
Total
2012
Grant Date
2 Sep 2010
10 Nov 2011
25 Nov 2011
Total
Vesting
Date
Holding
Lock
Date
31 Aug 2012
31 Aug 2013
30 Sep 2012
30 Sep 2013
25 Nov 2013
25 Nov 2014
Balance
at start of
the year
Number
750,800
–
–
750,800
Granted
during
the year
Number
–
375,000
467,500
842,500
Converted
during
the year
Number
–
–
–
–
Forfeited
during
the year
Number
33,000
–
10,000
Balance
at end of
the year
Number
717,800
375,000
457,500
43,000
1,550,300
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
62
62
Information used in assessing the fair value of performance rights granted during the year ended 30 June 2013 is as follows:
30 November 2012
Right grant date
13 September 2012
30 November 2012
30 November 2012
Number of rights granted
672,400
100,000
100,000
200,000
Vesting date
19 September 2014
30 September 2013
30 September 2013
30 September 2013
Disposal Restriction until
19 September 2015
30 September 2014
30 September 2014
30 September 2014
Performance Measure
KPIs
Share Price ≥ $1.86
Share Price ≥ $2.09
Expected price volatility of the company's
shares
Risk‐free interest rate
Expected dividend yield
Share price at grant date
Assessed fair value
55%
2.8%
‐
$1.55
$1.55
50%
3.0%
‐
$1.16
$0.19
50%
3.0%
‐
$1.16
$0.12
KPIs
50%
3.0%
‐
$1.16
$1.10
Right grant date
30 November 2012
30 November 2012
30 November 2012
30 November 2012
Number of rights granted
50,000
50,000
100,000
80,000
Vesting date
30 November 2014
30 November 2014
30 November 2014
30 November 2015
Disposal Restriction until
30 November 2015
30 November 2015
30 November 2015
30 November 2016
Performance Measure
Continued Employment
Index TSR
Index TSR+10% Continued Employment
Expected price volatility of the company's
shares
Risk‐free interest rate
Expected dividend yield
Share price at grant date
Assessed fair value
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
55%
2.8%
‐
$1.16
$1.10
55%
2.8%
‐
$1.16
$0.72
55%
2.8%
‐
$1.16
$0.70
60%
2.7%
‐
$1.16
$1.10
30 November 2012
30 November 2012
15 January 2013
80,000
200,000
50,000
30 November 2015
30 November 2015
15 January 2015
30 November 2016
30 November 2016
15 January 2016
Index TSR
Index TSR+10%
60%
2.7%
‐
$1.16
$0.77
60%
2.7%
‐
$1.16
$0.76
KPIs
50%
3.3%
‐
$1.17
$1.12
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
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63
Information used in assessing the fair value of performance rights granted during the year ended 30 June 2012 is as follows:
10 November 2011
Right grant date
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
Expenses arising from share‐based payment transactions
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
Total expenses arising from share‐based payment transactions recognised during the period were as follows:
Consolidated
Employee shares issued
Employee performance rights issued
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.
2013
$’000
32
923
955
2012
$’000
26
423
449
(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.
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
64
64
27. Parent entity financial information
(a) Summary financial information
The individual financial statements for the parent entity show the following aggregate amounts:
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 2013 (2012: nil).
2013
$'000
32,684
49,821
725
725
140,081
3,678
(94,663)
(10,088)
(10,088)
Parent
2012
$'000
41,232
58,836
832
1,485
139,171
2,755
(84,575)
(10,548)
(10,548)
65
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
65
Directors’ Declaration
In the directors’ opinion:
(a) the financial statements and notes set out on pages 32 to 65 are in accordance with the
Corporations Regulations 2001
Accounting Standards
Corporations Act 2001
, including:
(i) complying with
(ii) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2013 and of its performance for the financial year
and other mandatory professional reporting requirements; and
, the
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.
Act 2001
The directors have been given the declarations by the chief executive officer and chief financial officer required by section 295A of the
Corporations
.
This declaration is made in accordance with a resolution of the directors.
AO
Peter T Bartels,
Director
Melbourne, 26 August 2013
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
66
66
INDEPENDENT AUDIT REPORT TO THE MEMBERS
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
67
67
INDEPENDENT AUDIT REPORT TO THE MEMBERS
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
68
68
SHAREHOLDER INFORMATION
The shareholder information set out below was applicable as at 31 July 2013.
A. Distribution of equity shareholders
Supplementary information as required by ASX listing requirements.
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
There were 281 holders of less than a marketable parcel of ordinary shares.
B. Equity security holders
Shares
Options
Class of equity security
Performance rights
609
1,318
749
1,155
198
4,029
–
–
–
4
3
7
–
–
5
25
1
31
The names of the twenty largest holders of quoted equity securities are listed below:
Name
Number held
Ordinary shares
Percentage
of issued shares
1.
2.
3.
4.
5.
6.
7.
8.
9.
HSBC Custody Nominees (Australia) Limited
National Nominees Limited
JP Morgan Nominees Australia Limited
Citicorp Nominees Pty Limited
JP Morgan Nominees Australia Limited
T & N Argyrides Investments P/L
BNP Paribas Noms Pty Ltd
Kenneth Nominees Pty Ltd
Mr Peter Malcolm Colman
10. HSBC Custody Nominees (Australia) Limited
11. Citicorp Nominees Pty Limited
12. Applecross Secretarial Services Pty Ltd
13. JPS Distribution Pty Ltd
14. Dr Stuart Keith Roberts
15. UBS Wealth Management Australia Nominees Pty Ltd
16. Mr Kingsley Bryan Bartholomew
17. Commonwealth Scientific And Industrial Research Organisation
18. Mr Peter Murray Jackson
19. Ms Jacinth Fairley
20. Applecross Secretarial Services Pty Ltd
72,193,929
38,452,268
22,330,498
11,241,354
6,005,320
5,410,449
4,366,046
4,022,053
3,955,968
3,565,073
2,990,751
2,885,588
2,529,226
2,410,460
2,107,252
2,000,000
1,448,798
1,180,000
1,156,697
1,118,588
25.43
13.55
7.87
3.96
2.12
1.91
1.54
1.42
1.39
1.26
1.05
1.02
0.89
0.85
0.74
0.70
0.51
0.42
0.41
0.39
191,370,318
67.42
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
69
69
Name
Options issued under the Starpharma Holdings Limited
Employee Share Option Plan (ASX code SPLAM)
Employee Performance Rights
Total
C. Substantial holders
Unquoted equity securities over ordinary shares
Number on issue
Number of holders
585,000
1,970,900
2,555,900
7
31
Substantial shareholders as shown in substantial shareholder notices received by the company as at 31 July 2013:
Name
Acorn Capital Limited
Allan Gray Australia Pty Ltd
M&G Investment Funds
The Dow Chemical Company
D. Voting rights
Ordinary shares
Number held
36,614,463
35,194,434
34,174,302
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.
70
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
70
INTELLECTUAL PROPERTY REPORT
The Starpharma patent portfolio currently has around 30 active patent families with over 110 granted patents and more than 60 patent applications
pending.
Priority Date &
Key patents within the Starpharma portfolio as at 8 August 2013:
Publication Number
Title
Patents Granted
Applications Pending
VivaGel
Patent Portfolio
®
Antiviral Dendrimers
Anionic Or Cationic Dendrimer
Antimicrobial Or Antiparasitic
Compositions
Agents For The Prevention &
Treatment Of Sexually
Transmitted Diseases‐I
15 June 1994
WO95/34595
14 September 1998
WO00/15240
30 March 2001
WO02/079299
Microbicidal Dendrimer Composition
Delivery System
Contraceptive Composition
Method Of Treatment Or Prophylaxis
Drug Delivery Patent Portfolio
Of Bacterial Vaginosis
18 October 2005
WO2007/045009
22 March 2006
WO2007/106944
16 May 2011
WO2012/000891
Disulfide‐containing dendritic
Sep 30, 1996
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
Dendritic Polymers With Enhanced
Amplification And Interior
Functionality
25 October 2005
WO2007/048190
10 August 2006
WO2007/082331
11 August 2006
WO2008/017125
6 June 2011
WO2012/167309
20 April 2005
WO2006/065266
21 December 2005
WO2006/115547
PEHAM Dendrimers for use in
Agriculture
26 October 2009
WO2011/053605
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
Australia, Japan, New Zealand,
Russian Federation,
Australia, China, Japan, USA
USA
USA
USA
China, USA
Argentina, Canada, China, India,
Israel, Japan, Mexico, New
Zealand, Singapore, South Korea,
Taiwan, USA
Australia, Canada, China, India,
Israel, Mexico, New Zealand,
Singapore, South Korea, Taiwan,
USA
China
Brazil
Argentina, Canada, China, Europe, Hong
Kong, India, Malaysia, Mexico, South
Korea, Taiwan, USA
Canada, Europe,
Australia, USA, International application
Australia, Canada, Europe, USA
Australia, Canada, China, Europe, India,
Japan, USA
Europe, India,
Australia, International Application
Brazil, Europe, Hong Kong,
Argentina, Brazil, Europe, Hong Kong,
Japan,
Australia, Brazil, China, Europe, India,
Japan, USA
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
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71
Company name
Solicitors
CORPORATE DIRECTORY
Norton Rose Fulbright
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
ABN 20 078 532 180
Directors
Chairman
Deputy Chairman
Chief Executive Officer
P T Bartels AO –
P J Jenkins –
J K Fairley –
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
72
STARPHARMAHOLDINGSLIMITEDANNUALREPORT2013
72
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