BIOTRON LIMITED — Interim / Quarterly Report 2012

Feb 27, 2012

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Level 2, 66 Hunter Street Sydney NSW 2000 Tel: (61-2) 9300 3344 Fax: (61-2) 9221 6333 E-mail: pnightingale@biotron.com.au Website: www.biotron.com.au

28 February 2012

The Manager Companies ASX Limited 20 Bridge Street Sydney NSW 2000

(19 pages by email)

Dear Madam

HALF YEAR REPORTS

In accordance with Listing Rule 4.2A, I attach the Company's Appendix 4D and Interim Financial Report for the half year ended 31 December 2011. This Interim Financial Report should be read in conjunction with the Company's 30 June 2011 Annual Report.

Yours sincerely

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Peter J. Nightingale Company Secretary

pjn6543

Appendix 4D

Half Year Report

Name of entity

BIOTRON LIMITED

ABN or equivalent company Financial year ended (‘current period’) reference

60 086 399 144 31 DECEMBER 2011

Results for announcement to the market

Revenues from ordinary activities Loss from ordinary activities after tax attributable to members Net loss for the period attributable to members	Up 46% to 44,910 Up 47% to 1,497,449 Up 47% to 1,497,449
Dividends (distributions)		Amount per security	Franked amount per security
Final dividend Interim dividend		Nil¢ Nil¢	Nil¢ Nil¢
Previous corresponding period Final dividend Interim dividend		Nil¢ Nil¢	Nil¢ Nil¢
Record date for determining entitlements to the dividend. N/A Brief explanation of any of the figures reported above and short details of any bonus or cash issue or other item(s) of importance not previously released to the market: Refer attached reports.
NTA backing		Current period	Previous corresponding period
Net tangible asset backing per ordinary security		4.0 cents	0.7 cents

NTA backing	Current period	Previous corresponding
		period
Net tangible asset backing per ordinary security	4.0 cents	0.7 cents

BIOTRON LIMITED A.B.N. 60 086 399 144

INTERIM FINANCIAL REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2011

BIOTRON LIMITED

CONTENTS

	Page
Directors' Report	1
Condensed Interim Statement of Comprehensive Income	6
Condensed Interim Statement of Financial Position	7
Condensed Interim Statement of Cash Flows	8
Condensed Interim Statement of Changes in Equity	9
Notes to the Condensed Interim Financial Report	10
Directors' Declaration	13
Independent Auditor’s Review Report	14
Corporate Directory	15

BIOTRON LIMITED

DIRECTORS' REPORT

Your Directors have pleasure in submitting their report together with the interim financial report of Biotron Limited ('Biotron' or 'the Company') for the half year ended 31 December 2011 and the review report thereon.

Directors

The names of the Directors of the Company in office during or since the end of the half year are:

Mr Michael J. Hoy Independent and Non-Executive Chairman

Mr Hoy has more than 30 years' corporate experience in Australia, the United Kingdom, USA and Asia. He is Chairman of CityPrint Holdings Pty Limited, Chairman of Tellesso Technologies Limited and a former director of John Fairfax Holdings Limited and FXF Trust.

He has been a director since 7 February 2000 and Chairman since 16 March 2000.

Dr Michelle Miller, BSc, MSc, PhD, GCertAppFin (Finsia) Managing Director

Dr Miller has worked for over 20 years in the bioscience industry, with extensive experience in managing commercial bioscience research. She completed her PhD in the Faculty of Medicine at Sydney University investigating molecular models of cancer development. Her experience includes a number of years at Johnson and Johnson developing antiHIV gene therapeutics through preclinical research to clinical trials. She has experience in early-stage start-ups from time spent as Investment Manager with a specialist bioscience venture capital fund.

She was appointed as Managing Director on 21 June 2002.

Mr Bruce Hundertmark

Independent and Non-Executive Director

Mr Hundertmark is an independent businessman and company director with a wide range of experience in diverse business operations. He has specialised in recent years in high technology based company start-up operations and in promoting the formation of venture capital companies including News Datacom Research Limited in Israel, News Datacom Limited in Hong Kong and both PT Indo Bio Products and PT Indo Bio Fuels in Indonesia.

He has been a director of numerous private and publicly listed companies including News International PLC, Sky Television PLC, Prudential Cornhill Insurance Limited, Harris Scarfe Limited, Bernkastel Wines Limited, Codan Limited, Samic Limited and Investment & Merchant Finance Corporation Limited.

Mr Hundertmark was appointed as a director on 16 March 2000.

Dr Denis Wade Non-Executive Director

Dr Denis Wade has been involved for over 40 years with the development of research-based pharmaceuticals and medical devices in both industry and academia. He has been a director of several private and public companies in the Health-care sector, including Heartware Limited and subsequently HeartWare International Inc., since December 2004. He was a Director and Chairman of Gene Shears Pty Limited and, from 1987 until his retirement in 2002, Dr. Wade was Managing Director and Chairman of Johnson & Johnson Research Pty Ltd, a research and development company of Johnson and Johnson Inc. He was also a member of the J&J Corporate Office of Science and Technology. Prior to that, Dr. Wade was the Foundation Professor of Clinical Pharmacology at the University of New South Wales and served as a member of a number of State and Federal bodies related to the drug industry, including the P3 Committee.

He is a former Chairman of the Australian Academy National Committee for Pharmacology, the Australasian Society for Clinical and Experimental Pharmacology and Toxicology and a former Chairman of the Clinical Pharmacology Section of the International Union of Pharmacology.

Dr Wade holds a First Class Honours degree in Medicine and Science from the University of Sydney and a Doctorate of Philosophy from the University of Oxford. He was awarded an Honorary Doctorate of Science by the University of New South Wales and is a Fellow of the Royal Australasian College of Physicians and of the Australian Academy of Technological Sciences and Engineering. In 1999 he was made a Member of the Order of Australia.

Dr Wade was appointed as a director on 30 April 2010.

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BIOTRON LIMITED

DIRECTORS' REPORT

Dr Michael S. Hirshorn, OAM, MBA, MBBS, FFin Independent and Non-Executive Director

Dr Hirshorn was a director from 16 March 2000 to 18 November 2011.

We were all saddened by the death during the half year of Dr Michael Hirshorn. He had a 30 year career of founding, building, managing and investing in technology companies. As a director of the Company since its ASX Listing, he played a major role in the development of the Company. He was previously involved in all commercial aspects of Cochlear Limited's development, was a founding director of Resmed Inc., and Chief Executive Marketing for Polartechnics Limited.

He was involved in private equity fund raisings and served on numerous government advisory committees, including the Start IT and T Committee, the Start Grants Biological Sciences Committee of the Department of Industry, Science and Resources.

Mr Peter J. Nightingale Company Secretary

Mr Nightingale graduated with a Bachelor of Economics degree from the University of Sydney and is a member of the Institute of Chartered Accountants in Australia. He has worked as a chartered accountant in both Australia and the USA.

As a director or company secretary Mr Nightingale has, for the past 24 years, been responsible for the financial control, administration, secretarial and in-house legal functions of a number of private and public listed companies in Australia, the USA and Europe including Pangea Resources Limited, Timberline Minerals Inc., Perseverance Corporation Limited, Valdora Minerals N.L., Mogul Mining NL, Bolnisi Gold NL and Palmarejo Silver and Gold Corporation. Mr Nightingale is currently Chairman of Callabonna Uranium Limited and a director of Augur Resources Ltd, Cockatoo Coal Limited, Planet Gas Limited and Sumatra Copper & Gold plc.

Mr Nightingale has been Company Secretary since 23 February 1999.

Review of Operations

The period under review has seen significant advances on clinical progression of the Company's antiviral drug development program, with continued focus on clinical development of the Company’s lead drug, BIT225 for treatment of Hepatitis C virus ('HCV') and HIV.

Significant events achieved in this half year period include:

• Approximately 80 million 30 December 2011 options were exercised by the option holders, raising $8 million.

• Successful completion of the Company's Phase 2a clinical trial of its lead drug BIT225 in HCV-infected patients, demonstrating that BIT225 has good activity against genotype 1 HCV, and improves the outcome for patients receiving the current approved treatment of interferon and ribavirin.

• Commencement of a Phase 1b/2a clinical trial of BIT225 in HIV-infected patients.

• Presentation of data from the Phase 2a HCV trial at an international scientific conference in the USA.

• Showcasing the Company to the international investment community at various events in the USA as well as locally.

Clinical Development of BIT225

Biotron has an impressive pipeline of world class clinical programs developing new drugs to treat significant viral diseases including HCV and HIV.

During the half year under review, the Company successfully completed the third human trial of its lead drug, BIT225, an investigational, orally-administered, novel antiviral compound in development by Biotron for treatment of HCV and HIV infections.

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BIOTRON LIMITED

DIRECTORS' REPORT

The trial was a Phase 2a trial of BIT225 in combination with the currently approved treatment for HCV - interferon and ribavirin ('IFN/RBV'). The trial was designed to assess the safety of Biotron's drug when given daily for 28 days, as well to assess its effect on the level of virus in the blood of the patients and to see whether BIT225 is able to improve the efficacy of IFN/RBV in patients infected with the difficult to treat variant of HCV known as genotype 1. Twenty four HCVinfected patients were dosed twice daily with BIT225 or placebo for 28 days at the commencement of a standard course of treatment of IFN/RBV. At the conclusion of dosing with BIT225 or placebo, the patients continued to receive the standard course of IFN/RBV for a further 44 weeks.

Genotype 1 patients make up the majority of HCV infections in the Western world, and are the hardest to treat, with less than half responding to current approved treatment. There is thus, an unmet medical need for drugs that will improve treatment outcomes for this group of patients.

As has been reported, the trial successfully demonstrated that BIT225 has good anti-HCV activity. The drug was able to lower significantly the levels of virus in patients receiving BIT225 along with IFN/RBV when compared to those who only received IFN/RBV.

Almost 90% of patients who had received BIT225 plus IFN/RBV were free of virus at the 3-months assessment, compared to approximately 60% of patients who received IFN/RBV alone. This was although BIT225 was administered for only the 28 days of treatment.

The highly encouraging result validates Biotron's approach to treatment of this virus, and is the culmination of 10 years of research and development of Biotron’s antiviral program. This trial was a crucial step in the development path of BIT225, and followed on from a seven day dosage clinical trial of the drug on its own in HCV-positive patients. That monotherapy trial showed promising results, and the results of the Phase 2a combination trial with IFN/RBV confirmed the anticipated significant activity.

We had previously shown in laboratory studies that BIT225 has additional activity relative to IFN/RBV alone. The antiviral activity of BIT225 in this human trial provides further evidence of highly synergistic activity with IFN/RBV first seen in cell culture models of HCV infection.

Antiviral drugs cannot be used on their own to treat chronic infections because of the risk of developing drug resistance. Thus, this combination study reflects how BIT225 would most likely be used in a clinical setting, subject to continuing positive results and approvals. The existing drugs, interferon and ribavirin, are often associated with significant side effects which limits their use in many patients.

The pharmaceutical industry is currently focused on developing several new classes of direct-acting antiviral drugs for HCV which are likely to be used in combination with each other, and which may replace the problematic IFN/RBV treatment. BIT225 represents a first-in-class drug for treatment of HCV, targeting the p7 protein of HCV. In addition to having the potential to be used in combination with IFN/RBV to improve patient outcomes, BIT225 also has the potential to be used in combination with these other new classes of new drugs being developed.

It is estimated that in the USA alone, some 4 million people have been infected with Hepatitis C with 2.7 million suffering from chronic infection. Worldwide, 180 million people are infected (3% of the world population).

HCV causes inflammation of the liver, which, apart from the acute disease, may lead to cirrhosis, liver cancer and, ultimately, liver failure. Despite the limitations of existing drugs, the worldwide market for anti-HCV drugs, is currently almost US$3.3 billion but is estimated that this market will expand to over US$10.0 billion as safe, effective therapies enter the market.

BIT225 is also active against HIV, the virus that causes AIDS. In September 2011, Biotron commenced a Phase 1b/2a clinical trial of BIT225 in 24 HIV-infected patients who are anti-retroviral drug treatment naive.

We have already established that BIT225 represents a first-in-class opportunity to target the HIV virus in monocyte lineage cells where, until now, the virus has been able to 'hide' from current drug therapies. This strategy of targeting virus reservoirs is an area of great interest to HIV researchers globally, with most programs still in very early research stages of development.

Biotron’s approach is novel and relatively advanced. Current HIV therapies have little or no effect on HIV in the underlying reservoir of infected cells where the virus hides from the immune system. If successful, we anticipate that BIT225 could be used in combination with existing anti-retroviral therapies.

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BIOTRON LIMITED

DIRECTORS' REPORT

These trials in HCV and HIV infected patients are critical steps in the Company's development of these new drug candidates. Demonstration that BIT225 is a useful therapeutic agent will be a major advance in terms of Company and technology valuations. The Company is focused on further development of these and related drugs, and has been considering the later clinical development, including how best to facilitate advanced development stages.

Subsequent Events

No matters or circumstances have arisen since the end of the half year which significantly affected or may significantly affect the operations of the Company, the results of those operations, or the state of affairs of the Company in future financial years.

Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001

The lead auditor’s independence declaration is set out on page 5 and forms part of the Directors’ Report for the half year ended 31 December 2011.

This report has been signed in accordance with a resolution of the Directors and is dated 27 February 2012:

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Michael J. Hoy Director

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Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001 to the Directors of Biotron Limited

I declare that, to the best of my knowledge and belief, in relation to the review for the half year ended 31 December 2011, there have been:

• (i) no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the review; and

• (ii) no contraventions of any applicable code of professional conduct in relation to the review.

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KPMG

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Adam Twemlow Partner

27 February 2012 Brisbane

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BIOTRON LIMITED

CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME FOR THE HALF YEAR ENDED 31 DECEMBER 2011

Notes Administration and consultants' expenses Depreciation Direct research and development expenses Employee and director expenses Legal expenses Rent and outgoings expenses Other expenses from ordinary activities Operating loss before financing income Interest income Net finance income Loss before tax Income tax expense Loss for the period Other comprehensive income for the period Total comprehensive loss for the period Basic loss per share attributable to ordinary equity holders 6 Diluted loss per share attributable to ordinary equity holders 6	31 December 2011 $ 31 December 2010 $ (168,087) (123,815) (5,989) (7,194) (930,207) (483,016) (340,795) (324,536) (3,440) (6,387) (30,909) (34,174) (62,932) (69,420)
	(1,542,359) (1,048,542)
	44,910 30,691
	44,910 30,691
	(1,497,449) (1,017,851) - -
	(1,497,449) (1,017,851) - -
	(1,497,449) (1,017,851)
	(1.12) (0.84) cents
	(1.12) (0.84) cents

The condensed interim statement of comprehensive income is to be read in conjunction with the notes to the interim financial statements set out on pages 10 to 12.

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BIOTRON LIMITED

CONDENSED INTERIM STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2011

Current assets Cash and cash equivalents Trade and other receivables Other Total current assets Non-current assets Plant and equipment Total non-current assets Total assets Current liabilities Trade and other payables Employee entitlements Total current liabilities Total liabilities Net assets Equity Issued capital Reserves Accumulated losses Total equity	31 December 2011 $ 30 June 2011 $ 9,147,633 2,144,831 17,890 452,524 15,131 15,655
	9,180,654 2,613,010
	27,873 31,610
	27,873 31,610
	9,208,527 2,644,620
	34,797 140,544 116,821 103,776
	151,618 244,320
	151,618 244,320
	9,056,909 2,400,300
	32,539,415 23,087,673 382,176 2,171,485 (23,864,682) (22,858,858)
	9,056,909 2,400,300

The condensed interim statement of financial position is to be read in conjunction with the notes to the interim financial statements set out on pages 10 to 12.

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BIOTRON LIMITED

CONDENSED INTERIM STATEMENT OF CASH FLOWS FOR THE HALF YEAR ENDED 31 DECEMBER 2011

Cash flows from operating activities Cash receipts from R&D tax benefit Payments for research and development Cash payments in the course of operations Cash absorbed by operations Interest received Net cash used in operating activities Cash flows from financing activities Proceeds from issue of shares Net cash from financing activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at 1 July Cash and cash equivalents at 31 December	31 December 2011 $ 31 December 2010 $ 447,490 - (979,029) (542,779) (536,983) (389,161)
	(1,068,522) (931,940) 43,511 30,691
	(1,025,011) (901,249)
	8,027,813 9,953
	8,027,813 9,953
	7,002,802 (891,296) 2,144,831 1,780,567
	9,147,633 889,271

The condensed interim statement of cash flows is to be read in conjunction with the notes to the interim financial statements set out on pages 10 to 12.

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BIOTRON LIMITED

CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY FOR THE HALF YEAR ENDED 31 DECEMBER 2011

Attributable to equity holders of the Company Balance at 1 July 2010 Total comprehensive income for the period Loss for the period Other comprehensive income Transaction with owners, recorded directly in equity Ordinary shares issued Share based payment transaction Transfer expired options Exercise of options Balance at 31 December 2010 Balance at 1 July 2011 Total comprehensive income for the period Loss for the period Other comprehensive income Transaction with owners, recorded directly in equity Ordinary shares issued Share based payment transaction Transfer expired options Exercise of options Balance at 31 December 2011	Share capital $ Option premium reserve $ Retained losses $ Total $ 20,750,759 2,277,738 (21,310,939) 1,717,558 - - (1,017,851) (1,017,851) - - - - 9,953 - - 9,953 - 105,000 - 105,000 - (359,608) 359,608 - 1,991 (1,991) - -
	20,762,703 2,021,139 (21,969,182) 814,660
	23,087,673 2,171,485 (22,858,858) 2,400,300 - - (1,497,449) (1,497,449) - - - - 8,027,813 - - 8,027,813 - 126,245 - 126,245 - (491,625) 491,625 - 1,423,929 (1,423,929) - -
	32,539,415 382,176 (23,864,682) 9,056,909

The condensed interim statement of changes in equity is to be read in conjunction with the notes to the interim financial statements set out on pages 10 to 12.

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BIOTRON LIMITED

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2011

1. REPORTING ENTITY

Biotron Limited (the 'Company') is a company domiciled in Australia.

The annual financial report of the Company as at and for the year ended 30 June 2011 is available upon request from the Company’s registered office at Level 2, 66 Hunter Street, Sydney, NSW, 2000 or at www.biotron.com.au.

2. STATEMENT OF COMPLIANCE

The interim financial report has been prepared in accordance with AASB 134 Interim Financial Reporting and the Corporations Act 2001.

The Company’s interim financial report does not include all of the information required for a full annual financial report, and should be read in conjunction with the 30 June 2011 annual financial report and any public announcements by the Company during the half year in accordance with continuous disclosure obligations arising under the Corporations Act 2001.

The interim financial report was authorised for issue by the directors on 27 February 2012.

3. SIGNIFICANT ACCOUNTING POLICIES

The accounting policies applied by the Company in this interim financial report are the same as those applied by the Company in its financial report as at and for the year ended 30 June 2011.

4. ESTIMATES

The preparation of the interim financial report requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. Actual results may differ from these estimates.

In preparing this interim financial report, the significant judgements made by management in applying the Company’s accounting policies and the key sources of estimation uncertainty were the same as those that applied to the financial report as at and for the year ended 30 June 2011.

5. CAPITAL AND RESERVES

During the half year ended 31 December 2011, the Company issued ordinary shares following the exercise of 80,278,131 $0.10 options for cash totalling $8,027,813. There were no amounts unpaid on the shares issued and there were no material share issue costs.

During the half year ended 31 December 2010, the Company issued ordinary shares following the exercise of 99,529 $0.10 options for cash totalling $9,953. There were no amounts unpaid on the shares issued and there were no share issue costs.

No dividends were declared or paid by the Company during the current or prior period.

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BIOTRON LIMITED

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2011

6. LOSS PER SHARE

Basic and diluted loss per share have been calculated using: Net loss for the period Weighted average number of ordinary shares	31 December 2011 $ 31 December 2010 $ 1,497,449 1,017,851
	133,972,792 121,779,294

Options on issue are potential ordinary shares, but are not included in the calculation of diluted loss per share as they are not dilutive.

7. SHARE BASED PAYMENTS

The Company has a share option program that entitles key management personnel to be granted options in the Company.

There were no options issued during the half year ended 31 December 2011.

The terms and conditions of the grants made during the half year ended 31 December 2010 were as follows:

Grant date Expiry date Vesting date Exercise price 24 December 2010 30 October 2015 24 December 2010 $0.22 24 December 2010 30 October 2015 30 October 2011 $0.22 24 December 2010 30 October 2015 30 October 2012 $0.25	Fair value of options granted Granted during the period Exercised during the period Expired during the period Balance at end of the period Number Number Number Number $105,000 1,000,000 - - 1,000,000 $105,000 1,000,000 - - 1,000,000 $312,000 3,000,000 - - 3,000,000
	$522,000 5,000,000 - - 5,000,000

Fair value of options

The fair value of options granted is measured at grant date and recognised as an expense over the period during which the key management become unconditionally entitled to the options. The fair value of the options granted is measured using an option valuation methodology, taking into account the terms and conditions upon which the options were granted. The amount recognised as an expense is adjusted to reflect the actual number of options that vest.

The fair value of options granted on 24 December 2010 was $522,000. The Black-Scholes formula model inputs were the Company's share price of $0.12 at the grant date, a volatility factor of 141% based on historic share price performance, a risk free interest rate of 5.47% based on government bonds, and a dividend yield of 0%.

8. SEGMENT REPORTING

The Company operates solely in the biomedical industry in Australia.

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BIOTRON LIMITED

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2011

9. SUBSEQUENT EVENTS

No matters or circumstances have arisen since the end of the half year which significantly affected or may significantly affect the operations of the Company, the results of those operations, or the state of affairs of the Company in future financial years.

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BIOTRON LIMITED

DIRECTORS' DECLARATION

In the opinion of the directors of Biotron Limited:

• (a) the financial statements and notes, set out on pages 6 to 12, are in accordance with the Corporations Act 2001, including:

• (i) giving a true and fair view of the Company’s financial position as at 31 December 2011 and of its performance for the half year ended on that date; and

• (ii) complying with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001; 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.

This report has been signed in accordance with a resolution of the directors and is dated 27 February 2012:

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Michael J. Hoy Director

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INDEPENDENT AUDITOR’S REVIEW REPORT TO THE MEMBERS OF BIOTRON LIMITED

We have reviewed the accompanying interim financial report of Biotron Limited (the 'Company'), which comprises the condensed interim statement of financial position as at 31 December 2011, condensed interim statement of comprehensive income, condensed interim statement of changes in equity and condensed interim statement of cash flows for the half year ended on that date, a description of significant accounting policies and other explanatory notes 1 to 9, and the directors’ declaration.

Directors’ Responsibility for the Interim Financial Report

The directors of the Company are responsible for the preparation of the interim financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the interim financial report that is free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express a conclusion on the interim financial report based on our review. We conducted our review in accordance with Auditing Standard on Review Engagements ASRE 2410 Review of Interim and Other Financial Reports Performed by the Independent Auditor of the Entity , in order to state whether, on the basis of the procedures described, we have become aware of any matter that makes us believe that the interim financial report is not in accordance with the Corporations Act 2001 including: giving a true and fair view of the Company’s financial position as at 31 December 2011 and its performance for the half year ended on that date; and complying with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 . As auditor of Biotron Limited, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

A review of an interim financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Independence

In conducting our review, we have complied with the independence requirements of the Corporations Act 2001.

Conclusion

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the interim financial report of Biotron Limited is not in accordance with the Corporations Act 2001 , including:

• a) giving a true and fair view of the Company’s financial position as at 31 December 2011 and of its performance for the half year ended on that date; and

• b) complying with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 .

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KPMG 27 February 2012 Brisbane

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Adam Twemlow Partner

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BIOTRON LIMITED

CORPORATE DIRECTORY

Directors:

Mr Michael J. Hoy (Chairman) Dr Michelle Miller (Managing Director) Mr Bruce Hundertmark Dr Denis N. Wade

Company Secretary:

Mr Peter J. Nightingale

Registered Office:

Level 2, 66 Hunter Street SYDNEY NSW 2000 Phone: 61-2 9300 3344 Fax: 61-2 9221 6333 E-mail: enquiries@biotron.com.au Homepage: www.biotron.com.au

Share Registrar:

Computershare Investor Services Pty Limited 117 Victoria Street West End Queensland 4101 Phone: 61-7 3237 2100 Fax: 61-7 3229 9860

Auditors:

KPMG Level 16, Riparian Plaza 71 Eagle Street BRISBANE QLD 4000

Home Exchange:

ASX Limited 20 Bridge Street SYDNEY NSW 2000

Solicitors:

Minter Ellison 88 Phillip Street SYDNEY NSW 2000

Biotron Limited, incorporated and domiciled in Australia, is a publicly listed company limited by shares.

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