ANTEOTECH LTD — Interim / Quarterly Report 2013

Jul 28, 2013

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29 July 2013 Company Announcements Office Australian Stock Exchange Level 6, 20 Bridge Street Sydney NSW 2000

Anteo Diagnostics Limited (ASX : ADO) attaches its Appendix 4C for the quarter ending 30 June 2013.

CEO ACTIVITIES REPORT – QUARTER ENDED 30 JUNE 2013

Dear Fellow Shareholder,

The past quarter has seen steady progress toward the achievement of our corporate objectives along with the attainment of some significant milestones. Mix&Go™, our molecular glue, has successfully been used to simply, quickly and inexpensively attach biomolecules to synthetic surfaces for commercially important applications in in vitro Diagnostics (IVD testing), Point of Care (POC testing) and Life Science Research (LSR).

Through this period we have made pleasing progress in multiple projects in each of these three areas. The pursuit of these projects has opened up some new frontiers that will, in the near future, lead to the publication of scientific papers and filing of further patents with relevance in the fields of bioprocessing, bioseparations and high throughput drug screening and present us with next generation commercial possibilities.

Our financial position has been bolstered by increased revenues from customers and the award of a grant from Commercialisation Australia - $346,633 earned but not received this quarter.

This quarter had the following activities:

• Execution of the “Feasibility Study” Agreement with (POC I) was a fundamental step towards

• establishing Mix&Go in our “core” market.

• A paid project undertaken with (POC II) was completed successfully.

• Affymetrix have launched a further 32 products containing Mix&Go.

• A Chinese IVD company entered commercial negotiations following positive evaluation results.

• Closed the agreement with Gennova Scientific in Spain.

• A successful evaluation to coat glass slides with streptavidin using Mix& Go is undergoing 3[rd]

• party assessment.

• An evaluation of magnetic beads coated with streptavidin using Mix&Go expanded to broader

• assessment on proprietary nanoparticles.

• Granted “Use of Metal Complexes” patent by the European Patent Office.

• Continued work with different nanoparticles has both resulted in a number of successful evaluations and cemented our intent to file new patents.

• Obtained a $1.7 M Commercialisation Australia – Early Stage Commercialisation Grant.

Anteo Diagnostics Limited ABN 75 070 028 625

Unit 4, 26 Brandl Street, Eight Mile Plains Qld 4113 Phone 07 3219 0085 Fax 07 3219 0553 Email contact@anteodx.com Web www.anteodx.com

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AFFYMETRIX

We were advised that 32 new products in the ProcartaPlex range, that utilise Mix&Go were introduced to the market at the end of June. Revenues from these, and additional new products, will now begin to flow as they enter the range. The Affymetrix acquisition of eBioscience has decreased the likelihood that Mix&Go will be incorporated into all products within that range due to the better performance that is possible from the bead at the core of the ProcartaPlex range.

The work we have undertaken in collaboration with Affymetrix on a new bead-based range of products has generated positive results. Optimisation work undertaken has identified a novel protocol that presents the possibility of delivering additional gains of 3-5 fold in sensitivity. We are investigating the general nature of this protocol to assess whether it improves outcomes with all antibodies and on other surfaces.

Two further developmental projects, in areas that are distinct from our current areas of focus, remain at an early stage.

PAID POINT OF CARE PROJECT l

The “Feasibility Study” Agreement, with a global healthcare company, is a paid collaborative project aiding the development of a novel Point of Care device. The objectives are scheduled to take 12 months to complete.

The feasibility work commenced on 13[th] March. Since then two Anteo scientists have worked for a period in the European laboratories of our partner, enhancing our knowledge of issues to be addressed at manufacturing scale and increasing the level of cooperation between the relevant teams. A shipment of equipment was received from the company that, amongst other things, allows us to manufacture the consumable component of the test to facilitate comparison of results between the centres, which allows us to provide our customer with a “ready-to-manufacture” solution. Formal project meetings are held every fortnight and there is almost daily bi-directional communication between the collaborators.

The Anteo scientists intend to provide an improved solution that clearly demonstrates the many advantages of Mix&Go beyond the project parameters.

PAID POINT OF CARE PROJECT ll

An initial paid project was completed to the satisfaction of a second company active in the POC space. This company holds a leading position in the development, manufacture and supply of conventional, lateral flow, POC tests. The next step is to undertake a more substantial “optimisation” study and perhaps a final, paid, scale-up exercise to enable incorporation of Mix&Go into their manufacturing process. A recent meeting with the senior management of this company revealed their desire to develop a “next generation” point of care range and their optimism around the role that Mix&Go may play. This thinking has led our partner to identify two other opportunities within their organisation that could benefit from the use of Mix&Go. We expect to finalise details of the activities that need to be undertaken in the near future.

Anteo Diagnostics Limited ABN 75 070 028 625 Unit 4, 26 Brandl Street, Eight Mile Plains Qld 4113 Phone 07 3219 0085 Fax 07 3219 0553 Email contact@anteodx.com Web www.anteodx.com

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CHINESE IVD PROJECT

A Chinese IVD company has been developing an automated immunoassay platform for a number of years. Evaluation of Mix&Go on their proprietary beads demonstrated performance equal to if not better than expensive imported beads. As a result, the company is pursuing the process of making their own beads.

The next steps are the manufacture of several batches of the proprietary beads, the construct of a range of tests, with the inclusion of Mix&Go, then performance reassessment. Chinese FDA approval follows before these tests can be marketed.

Project success will represent a major precedent for us in the eyes of other IVD companies worldwide. Commercial terms have already been discussed and, of course, we are providing all assistance possible.

MICROTITRE PLATE OPPORTUNITIES

Our microtitre plate product development continues to evolve and we are pursuing two approaches to extract value for Anteo from plates.

Firstly, Mix&Go improves the sensitivity of tests performed on microtitre plates, reduces the amount of antibody required and the variability between test results. The novel protocol discussed under “Affymetrix” (above) has the potential to lead to further improvements. This is currently being tested.

Secondly, when Mix&Go is used to bind streptavidin to microtitre plates, significantly lower levels of antibodies can be detected than with current industry standards, i.e. the sensitivity of antibody measurement is improved and the dynamic range is increased.

We are engaged with multiple parties who have expressed interest in gaining access to Mix&Go to improve outcomes with their existing and planned new products. Gennova and OWL present us with further distribution options and we are in the process of gearing up to allow direct sales from our website.

SLIDE OPPORTUNITIES

We have found that streptavidin, when bound to glass slides using Mix&Go, is stable for many months at room temperature. Currently available products need to be shipped on dry ice, stored frozen and used within days.

A major European manufacturer of glass products has undertaken in-house testing on product manufactured using Mix&Go. They were sufficiently impressed with the outcome and confident with the performance that they shipped some (at room temperature) to a major customer to obtain third party assessment. This company and many others, supply a range of slides with a variety of coatings, including streptavidin.

Anteo Diagnostics Limited ABN 75 070 028 625 Unit 4, 26 Brandl Street, Eight Mile Plains Qld 4113 Phone 07 3219 0085 Fax 07 3219 0553 Email contact@anteodx.com Web www.anteodx.com

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NANOPARTICLE OPPORTUNITIES

Our nanoparticle work continued to gain momentum. Engagement with a range of commercial partners produced a broad array of desired outcomes. With Mix&Go we have demonstrated an ability to improve the stability of gold colloids used in lateral flow POC tests; coat streptavidin onto commercially available magnetic nanoparticles; and enhance gold-coated silica fibres for use in SPR probes. Further early studies using Mix&Go by a company who manufacture a large range of inflammation, tumour marker, diabetes and urine POC tests have shown the value of Mix&Go.

Using iron oxide (magnetite) we have been able to manufacture our own nano and micro particles opening the opportunity to move further up the value chain.

.

COP and COC OPPORTUNITIES

Cyclic olefin polymers (COP) and cyclic olefin copolymers (COC) are two relatively newly developed plastics that are finding many uses in the clinical sciences. Whilst they have many advantages over more conventional materials, such as plastic and glass, it is difficult to bind proteins to them. Mix&Go allows this to occur and as a result opens up a range of commercially valuable novel applications.

We have been fortunate in securing the services of an intern from the University of Queensland, Huey Wen Ooi. Huey has an Honours degree in nanotechnology and, in her PhD project, has studied the preparation of polymeric hydrogels and diffusion of drugs through hydrogel networks. Work she has undertaken through her tenure with us has greatly accelerated our commercialisation efforts in this new and exciting field.

COMMERCIALISATION AUSTRALIA GRANT

Commercialisation Australia granted us an Early Stage Commercialisation Grant worth $1.7 M over two years.

These non-dilutionary grants are keenly sought after and highly competitive. Very few grants of this magnitude are awarded and our success is a validation of our technology and the progress being made commercialising Mix&Go.

Many of the organisations with whom we are interacting were contacted by the granting body to obtain candid feedback about both our product and their assessment of the likely success of our company. We are very proud of this achievement.

Anteo Diagnostics Limited ABN 75 070 028 625 Unit 4, 26 Brandl Street, Eight Mile Plains Qld 4113 Phone 07 3219 0085 Fax 07 3219 0553 Email contact@anteodx.com Web www.anteodx.com

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INTELLECTUAL PROPERTY

We were informed through the course of the quarter that our “Use of Metal Complexes” patent had been granted by the European Patent Office. This was the sole outstanding case for this patent family.

“Binding Systems” is currently going through examination in the National Phase and, in addition to our standard filing jurisdictions, we have chosen to file in China, India and Brazil in recognition of the increasing importance of these jurisdictions in our industry.

Following recent work in our laboratories we intend to file one and possibly several new patent applications shortly. The fields of interest complement our current portfolio and include bioprocessing, bioseparations and high throughput drug screening.

We will consider investing in these areas to accelerate reducing the patents to practice and to hasten commercialisation with a view to producing earlier revenues.

MARKETING ACTIVITIES

Dr Joe Maeji, our CSO, was an invited speaker at the 4[th] International NanoMedicine Conference in Sydney between 1[st] and 3[rd] July.

CORPORATE

Two members of staff resigned during the quarter as a result of family illnesses. We thank both for their contribution and in particular we were saddened to lose Dr Nevin Abernethy, as he was key in the early stages of converting Mix&Go from a prototype to a product.

Dr Charlie Huang, Dr Rachel de las Heras and Carmen Munian have all recently joined us and each brings unique experience, skills and commercial networks to ensure that we have an enviable and more robust, commercially savvy, scientific capability.

The benefits are already being felt from the contributions of our new staff, along with valuable scientific and industry based input from Dr John Hurrell, non-executive director, since his appointment.

The cash balance at the end of the quarter was $2.6 M and expenditures continue to be in line with expectations.

Finally, we encourage those interested in our company to add their email address to our mailing distribution list contact@anteodx.com to ensure that they receive newsletters as they are produced. Information sent out by email will also be available on our website.

Dr Geoff Cumming CEO Anteo Diagnostics Limited

Anteo Diagnostics Limited ABN 75 070 028 625 Unit 4, 26 Brandl Street, Eight Mile Plains Qld 4113 Phone 07 3219 0085 Fax 07 3219 0553 Email contact@anteodx.com Web www.anteodx.com

Rule 4.7B

Appendix 4C

Quarterly report for entities admitted on the basis of commitments

Name of entity Anteo Diagnostics Limited ACN or ARBN Quarter ended (“current quarter”)	Name of entity Anteo Diagnostics Limited ACN or ARBN Quarter ended (“current quarter”)
75-070-028-625	30-Jun-13

Consolidated statement of cash flows

Consolidated statement of cash flows
Cash flows related to operating activities	Current quarter $A’000	Year to date (12 months) $A’000
1.2 Payments for (a) staff costs (b) advertising and marketing (c) research and development (excluding staff costs relating to R&D) (d) leased assets (e) other working capital 1.3 Dividends received 1.4 Interest and other items of a similar nature received 1.5 Interest and other costs of finance paid 1.6 Income taxes paid 1.1 Receipts from customers and government grants	18 (448) (141) (134) - (174) - 30 - -	1,300 (1,688) (525) (571) - (969) - 173 - -
Net operating cash flows	(849)	(2,280)

NOTES:

		Current quarter $A’000	Year to date (12 months) $A’000
1.8	Net operatingcash flows(carried forward)	(849)	(2,280)
1.9 1.11 1.12 1.13 1.10	Cash flows related to investing activities Payment for acquisition of: (a) Businesses (b) equity investments (c) intellectual property (d) physical non-current assets (e) other non-current assets Proceeds from disposal of: (a) Businesses (b) equity investments (c) intellectual property (d) physical non-current assets (e) other non-current assets Loans to other entities Loans repaid by other entities Adjustment for cash remaining in subsidiary entity at disposal Net investing cash flows	- - - (11) - - - - - - - - -	- - - (87) - - - - - - - - -
		(11)	(87)
1.14	Total operating and investing cash flows
		(860)	(2,367)
1.15 1.16 1.17 1.18 1.19 1.20	Cash flows related to financing activities Proceeds from issues of shares, options, etc. Proceeds from sale of forfeited shares Proceeds from borrowings Repayment of borrowings Dividends paid Other: Conversion of converting notes Interest paid on converting notes Capital raising costs Net financing cash flows	- - - - - - - -	104 - - - - - - -
		-	104
1.21 1.22 1.23	Net increase (decrease) in cash held Cash at beginning of quarter/year to date Exchange rate adjustments to item 1.20 Cash at end ofquarter
		(860) 3,480 -	(2,263) 4,883 -
		**2,620 **	2,620
NOTES: 1.20

Payments to directors of the entity and associates of the directors Payments to related entities of the entity and associates of the related entities

1.24 Aggregate amount of payments to the parties included in item 1.2 1.25 Aggregate amount of loans to theparties included in item 1.11	1.24 Aggregate amount of payments to the parties included in item 1.2 1.25 Aggregate amount of loans to theparties included in item 1.11	Current quarter $A'000
		181
		NIL
1.26 Explanation necessary for an understanding of the transactions

Non-cash financing and investing activities

• 2.1 Details of financing and investing transactions which have had a material effect on consolidated assets and liabilities but did not involve cash flows

NIL

• 2.2 Details of outlays made by other entities to establish or increase their share in businesses in which the reporting entity has an interest

NIL

Financing facilities available

Add notes as necessary for an understanding of the position. (See AASB 1026 paragraph 12.2).

3.1 Loan facilities 3.2 Credit standby arrangements	Amount available $A’000	Amount used $A’000
	NIL	NIL
	NIL	NIL

Reconciliation of cash

Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows.	Current quarter $A’000	Previous quarter $A’000
4.1 Cash on hand and at bank 4.2 Deposits at call 4.3 Bank overdraft 4.4 Other - Funds held in trust re. Open Prospectus Offer	25	22
	2,595	3,458
		-
		-
Total: cash at end of quarter(item 1.23)	2,620	3,480

Acquisitions and disposals of business entities

Acquisitions and disposals of business entities
5.1 Acquisition/disposal of subsidiary 5.2 Place of incorporation or registration 5.3 Consideration for acquisition or disposal 5.4 Total net assets at date of acquisition/disposal Nature of business 5.5	Acquisitions (Item 1.9(a))	Disposals (Item 1.10(a))

Compliance statement

1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Act 2001 (except to the extent that information is not required because of note 2) or other standards acceptable to ASX.

2 This statement does give a true and fair view of the matters disclosed.

Sign here:

Date: 29 July 2013

(Director)

Print name: Richard Martin