AVECHO BIOTECHNOLOGY LIMITED — Regulatory Filings 2012

Dec 2, 2012

ASX Limited Market Announcements Office

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Oxycodone Patch Update: Development Program and Product Expansion

• Crystallisation issues resolved and improved patch design

• Expansion of Phosphagenics’ opioid patch strategy to build an opioid patch franchise

• Oxymorphone selected as additional candidate for TPM[] transdermal pain patch development

3 December 2012, Melbourne, Australia: Melbourne drug delivery technology company, Phosphagenics Limited (ASX: POH, OTCQX: PPGNY), provides this update on its opioid patch development program.

Working with its European development partner, Phosphagenics (as previously reported in the September 2012 newsletter) has resolved all crystallisation issues with its oxycodone patch design and has improved the product formulation. A multi-dose study of this first-in-class product is expected to begin in early 2013. Following the completion of the trial which will take up to six weeks, an Investigational New Drug (IND) will be submitted for approval by the US FDA to commence the Phase 3 program.

In recent months, during the delay in the patch program, the Company has prepared a detailed strategic, clinical and commercial development plan for the oxycodone patch. Working closely with its US-based commercial advisers, Neura Therapeutik, as well as regulatory and clinical advisers, INC Research, the Company has developed a detailed Target Product Profile (TPP) to form part of the final product label.

The Clinical Development Plan (CDP) has also been prepared. This outlines clinical activities and study designs for successful product registration.

The detailed preparation work outlined above will provide a platform for the development and commercialisation of other opioid pain patches incorporating the Company’s proprietary TPM[] platform delivery technology.

Over the past six months Phosphagenics has been carefully evaluating several other opioids that have the potential to be included in a comprehensive transdermal pain patch product portfolio.

Phosphagenics Limited ACN 056 482 403 ABN 32 056 482 403

11 Duerdin Street, Clayton VIC 3168 PO Box 1415, Clayton South MDC VIC 3169 Australia Tel: +61 (0)3 9565 1119 Fax: +61 (0)3 9565 1151

Web: www.phosphagenics.com Email: info@phosphagenics.com

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The first opioid selected for further development work is oxymorphone, a semi-synthetic opioid molecule very similar to oxycodone.

Oxymorphone is approved by the FDA to treat moderate to severe chronic pain and has global sales approaching $1 billion per annum. The market is dominated by Opana[®] , an oral oxymorphone product manufactured by Endo Pharmaceuticals.

While oral oxymorphone is three-and-a-half times more potent than oxycodone, it has very low bioavailability. This makes it an ideal candidate for transdermal delivery.

Following the successful pre-clinical program with this compound, the Company will proceed with a single-dose clinical trial of an oxymorphone patch early in 2013.

This means that both oxycodone and oxymorphone patch products will be in clinical trials in early 2013.

Phosphagenics’ CEO, Dr Esra Ogru, acknowledged the Company’s substantial investment in its oxycodone program and said it plans to aggressively leverage this technology to produce multiple products in the pain space to maximise shareholder benefit.

“The prospect of having two major opioid projects entering the clinic simultaneously represents a significant increase in the value of the program,” she said.

“We remain focused and committed to commercialising our first-in-class pain patch technology.”

Neura Therapeutik CEO, John LaLota, said: “The addition of oxymorphone to the transdermal delivery strategy provides a valuable extension to Phosphagenics’ pain portfolio. This enables the Company to provide solutions to manage chronic pain across the spectrum of pain indications and represents an additional blockbuster drug opportunity.”

Ends

Enquiries:

Dr Esra Ogru Chief Executive Officer Phosphagenics Limited +61 3 9565 1119

David Segal Investor Relations Manger Phosphagenics Limited +61 3 9565 1103

Rudi Michelson Monsoon Communications +61 3 9620 3333

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About Phosphagenics

Phosphagenics Limited is commercialising drug delivery applications based on its novel transdermal (drugs administered via skin) TPM[] – Targeted Penetration Matrix technology. TPM[] is a patient friendly and cost effective system used to deliver proven pharmaceutical and nutraceutical products.

The lead product advancing through clinical trials is an oxycodone matrix system for the relief of chronic pain.

Phosphagenics’ shares are listed on the Australian Securities Exchange (POH) and its ADR – Level 1 program in the US is with The Bank of New York Mellon (PPGNY).

www.phosphagenics.com www.elixia.com.au

About Opioids

The total global market for products to manage chronic pain is in excess of $30 billion per annum, with approximately $14 billion via sales of opioids. About $11 billion of these opioid sales are made in the USA with the market evenly split between immediate release and extended release products. There are a number of different forms of opioids used for the treatment of pain. Clinicians require the flexibility of switching from one opioid to another to overcome patients’ tolerance build-up over time. It is for this reason the Company is developing a strategy that offers clinicians the ability to switch from one transdermal opioid to another.

Over $1 billion worth of opioids is delivered transdermally. The market is dominated by fentanyl patches, although buprenorphine has also been successfully delivered transdermally. These patches are sold under brand names including Duragesic[] , Butrans[] and Norspan[] .

Any patch-delivery technology needs to consider issues such as skin irritation, adhesion (especially in warm climates), efficacy, abuse potential, sensitisation, patch application location and patch size. TPM[] delivery technology addresses many of these issues. The development of opioid patches represents a substantial market opportunity with transdermal delivery overcoming many of the serious problems associated with oral delivery of these compounds, including gastrointestinal complaints.

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