INOVIQ LTD — Annual Report 2017

Aug 30, 2017

Appendix 4E Preliminary final Report

,.Rules 4.3A

Appendix 4E

Preliminary final report

Name of entity

Bard1 Life Sciences Limited

ABN or equivalent company reference 58 009 070 384	Year ended (‘current period’)
	30 June 2017
	6 months ended (‘comparative period’)
	30 June 2016

Results for announcement to the market

$AUD

esults for announcement to the market $AUD	esults for announcement to the market $AUD	esults for announcement to the market $AUD	esults for announcement to the market $AUD
Revenues from ordinary activities Up N/A To 44,028 Loss from ordinary activities after tax attributable to members Down 8.4% To (2,604,171) Net loss for the period attributable to members Down 8.4% To (2,604,171)
Dividends (distributions)		Amount per security	Franked amount per security
Interim dividend		Nil	- ¢
Final dividend		Nil	- ¢
Previous corresponding period		Nil	- ¢
+Record date for determining entitlements to the dividend, (in the case of a trust,distribution)	N/A
	N/A

The above results should be read in conjunction with the notes and commentary contained in this report.

• See chapter 19 for defined terms

Appendix 4E

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Appendix 4E Preliminary final Report

Management Discussion and analysis

OPERATING RESULTS

The Group’s has reported a loss from ordinary activities for the year of $2,604,171 (2016: net loss totalling $2,841,093), comprising Research and Development (R&D) expenditure of $1,089,976 on the BARD1 pipeline, patent expenses of $131,187, and staff, corporate and administration costs of $1,383,008. The closing cash balance at 30 June 2017 was $650,051.

The loss per share of the Group for the full-year ended 30 June 2017 was 0.45 cents per share (2016: 1.1 cents per share). The loss per share calculations for all periods prior to 30 June 2017 have been adjusted by factors of 1.041 and 1.008 respectively to reflect the bonus element of the capital raising and Share Purchase Plan completed subsequent to year end.

OPERATIONAL REVIEW

• Initiated new Ovarian Cancer Diagnostic Program: Completed initial POC studies in September 2016 and OC300 study in January 2017 to evaluate a new research-grade BARD1 Ovarian Cancer Test, with positive results showing high accuracy, sensitivity and specificity for detection of ovarian cancer

• Strengthened the leadership team: Appointed Dr Leearne Hinch as CEO in November 2016

• Advanced Lung Cancer Diagnostic Program: Completed pilot study in November 16 and LC600 study in December 2016 to further develop and optimise the BARD1 Lung Cancer Test on a new assay platform, with promising results for gender-specific algorithms

• New patent granted: US patent no 9,599,624 issued for core patent family providing protection for BARD1 Lung Cancer Test in March 2017

• Collaboration for Cancer Vaccine Program: Entered a research collaboration with the Institute for Respiratory Health (IRH) to evaluate a potential BARD1-based cancer vaccine in April 2017

BARD1 Life Sciences Ltd (ASX:BD1) is an Australian biotechnology company focused on developing and commercialising non-invasive diagnostic tests for early detection of cancer. Since re-listing on the Australian Securities Exchange on 20 June 2016 the Company has implemented its business plan including establishing contract research facilities at the University of Geneva (UNIGE), implementing research studies to advance its lead product the BARD1 Lung Cancer Test and evaluate a new product the BARD1 Ovarian Cancer Test, appointing a Chief Executive Officer, relocating our headquarters to the Harry Perkins Institute of Medical Research, undertaking larger retrospective studies for both lung cancer and ovarian cancer at Meso Scale Diagnostics’ (MSD) facilities, and initiating a cancer vaccine collaboration with the Institute for Respiratory Health (IRH).

Lung Cancer Diagnostic Program

During the year, BARD1 LSL completed a number of lung cancer studies to develop and optimise the BARD1 Lung Cancer Test. BARD1 LSL initially completed a Pilot Study in 40 samples to evaluate the feasibility of transferring its research-grade autoantibody test to a new Meso Scale Diagnostics (MSD) multiplex assay platform in 40 samples of lung cancer and controls. The results showed high accuracy of the BARD1 Lung Cancer Test on the new platform with a receiver operating characteristic (ROC)area under the curve (AUC) of 0.93 for the best fitted model, supporting further method development and optimisation of the BARD1 Lung Cancer Test on the new platform in larger patient samples.

• See chapter 19 for defined terms

Appendix 4E

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Appendix 4E Preliminary final Report

A larger retrospective Lung Cancer Study (LC600) was then conducted to evaluate the performance of the research-grade BARD1 Lung Cancer Test on the new platform in 638-samples of lung cancer and controls. Analysis of 628 samples demonstrated an AUC 0.85, sensitivity 80%, and specificity 78% for the best fitted model, and a predicted average AUC 0.80, sensitivity 80%, and specificity 68% in the test sets used to evaluate the model. Importantly, gender-specific algorithms showed higher accuracy of AUC 0.91 in males and AUC 0.89 in females for the best fitted models. The LC600 study confirmed previous findings that the BARD1 Lung Cancer test could detect all stages of lung cancer, and demonstrated the potential of further developing a gender-specific BARD1 LC Test for early detection of lung cancer.

Ovarian Cancer Diagnostic Program

BARD1 LSL initiated several studies to evaluate a new BARD1 Ovarian Cancer Test for detection of ovarian cancer. BARD1 LSL conducted two small Proof of Concept (POC) studies to evaluate the feasibility of using a small 10 peptide set to detect ovarian cancer. The first study in 116 samples of ovarian cancer and healthy controls from different origins showed high accuracy with an AUC 0.86 for the best-fitted model. The second study tested an additional 88 samples of ovarian cancer and matched healthy controls, and yielded an AUC 0.96 for the best-fitted model. These POC studies indicated the feasibility of developing an accurate blood test with high sensitivity and specificity for detection of ovarian cancer.

A larger retrospective Ovarian Cancer Study (OC300) was then conducted to evaluate the performance of the research-grade BARD1 Ovarian Cancer Test on the new MSD platform in 348 female samples of ovarian cancer and controls. The results showed high accuracy with an AUC 0.92, sensitivity 90%, and specificity 87% for the best fitted model, and a predicted average AUC 0.85, sensitivity 78%, and specificity 78% in the test sets used to evaluate the model. This study showed high accuracy across all types and stages of ovarian cancer, and demonstrated the potential of further developing the BARD1 OC Test for early detection of ovarian cancer.

Cancer Vaccine Program

BARD1 LSL entered a collaboration with the Institute for Respiratory Health (IRH) in April 2017 to evaluate a potential BARD1 cancer vaccine for the prevention and/or treatment of cancer in animal models. Stage 1 of the cancer vaccine project to identify high BARD1 expressing tumour cell lines for implantation in animals and to obtain Animal Ethics Committee approval for the planned animal studies is near completion. Stage 2 of the study is designed to evaluate the in vivo effectiveness of the BARD1 vaccine formulations for reducing tumour growth in animal studies.

Intellectual Property Portfolio

US Patent no 9,599,624 titled “BARD1 isoforms in lung and colorectal cancer and use thereof” was granted by the USPTO on 21 March 2017. This patent family protects the sequence of various BARD1 isoforms specific to lung and colorectal cancer, a method for detecting the presence of the specific BARD1 isoforms, and a method for treating and/or preventing lung cancer and colorectal cancer. BARD1 LSL owns or licenses 5 patent families with 6 granted and 20 pending patent applications covering various BARD1 DNA and protein sequences, methods of diagnosis and treatment, and use in multiple cancers.

• See chapter 19 for defined terms

Appendix 4E

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Appendix 4E Preliminary final Report

Outlook

The Directors of BARD1 Life Sciences Ltd are committed to realising the commercial potential of the BARD1 technology, and advancing its diagnostic and therapeutic projects towards key development milestones. Current research and development (R&D) plans are focused on the further evaluation, development and analytical validation of the BARD1 Tests, before advancing towards clinical validation. Additionally, the Company intends to explore strategic business opportunities including business combination, acquisition, in-licensing, and other transactions to strengthen its business, expand its product pipeline, diversify its risk profile, and grow long-term shareholder value.

SUBSEQUENT TO BALANCE DATE

In July 2017, the Company successfully completed a Placement of 137,165,811 BD1 shares to sophisticated and professional investors at $0.008 to raise $1.097M (before costs), followed by a Share Purchase Plan (SPP) to eligible shareholders that placed 52,000,000 shares at $0.008 to raise $416K (before costs). The total funds raised in the combined Placement and SPP were $1.513 million (before costs). The Company now has 741,995,731 ordinary shares on issue.

On 20 July 2017, BARD1 LSL announced that it had appointed international respiratory medicine expert, Dr Samuel Janes, as a member of its Advisory Board. Dr Janes will provide independent scientific and clinical advice to guide the Company’s research, development and business programs.

On 28 July 2017, Australian Patent no 2011292809 titled “BARD1 isoforms in lung and colorectal cancer and use thereof” was granted by IP Australia.

On 7 August 2017, a key paper on the original POC Study results and underlying scientific methodology for the BARD1 Lung Cancer Test was published in international peer-reviewed journal PLoS ONE .[1]

1 Pilyugin M, Descloux P, André P-A, Laszlo V, Dome B, Hegedus B, et al. (2017) BARD1 serum autoantibodies for early detection of lung cancer. PLoS ONE 12(8): e0182356. https://doi.org/10.1371/journal.pone.0182356 + See chapter 19 for defined terms

Appendix 4E

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Appendix 4E Preliminary final Report

Consolidated Income Statement For the year ended 30 June 2017

	Notes	for the year ended 30 June 2017 $	for the 6 months ended 30 June 2016 $
Revenue from ordinaryactivities		44,028	-
Employee benefits expense		(701,669)	(13,673)
Listingexpense on acquisition of BARD1 LSL		-	(2,463,404)
Loss arising from re-measurement of financial liabilities		-	(250,000)
Depreciation expense		(8,008)	(4,253)
Movement in fair value of investments held for trading		(8,990)	-
Impairment of available for sale financial assets		(56,458)	-
Foreign exchangegain/(loss)		13,754	-
Research and development		(1,089,976)	-
Patent expenses		(131,187)	-
Share basedpayment expense		(25,000)	-
Administration costs		(575,252)	(109,763)
Provision for Grant repayment		(65,413)	-
Loss before income tax		(2,604,171)	(2,841,093)
Income tax expense		-	-
Loss after income tax expense		(2,604,171)	(2,841,093)
Other comprehensive income Items that may be subsequently reclassified to operating result
Foreign currencytranslation		3,187	2,645
Other comprehensive income/(loss) for the period		3,187	2,645
Total comprehensive loss for the period, net of tax		(2,600,984)	(2,838,448)

Earnings/(loss) per share	for the year ended 30 June 2017 $	for the 6 months ended 30 June 2016 $
Basic earnings/(loss) per share	(0.0045)(1)	(0.011)(1)
Diluted earnings/(loss) per share	(0.0045)(1)	(0.011)(1)

• See chapter 19 for defined terms

Appendix 4E

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Appendix 4E Preliminary final Report

Based on a weighted average number of shares totalling 552,208,915 (ordinary shares) for the year ended 30 June 2017 (2016: 241,063,532 ordinary shares based on the issued capital of BARD1AG retrospectively adjusted for the merger ratio). At 30 June 2017 the Company had 552,829,919 ordinary shares on issue.

The loss per share calculations for all periods prior to 30 June 2017 have been adjusted by factors of 1.041 and 1.008 respectively to reflect the bonus element of the capital raising and Share Purchase Plan completed subsequent to year end.

• See chapter 19 for defined terms

Appendix 4E

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Appendix 4E Preliminary final Report

Consolidated Statement of Financial Position

As at 30 June 2017

	Notes	as at 30 June 2017 $	as at 30 June 2016 $
Current assets Cash and cash equivalents Receivables Held for tradinginvestments	1	650,051 31,956 16,659	3,097,751 76,412 25,649
Total current assets		698,666	3,199,812
Non-current assets Property, plant and equipment Financial assets classified as available-for-sale		- 28,230	8,008 84,689
Total non-current assets		28,230	92,697
Total assets		726,896	3,292,509
Current liabilities Trade and other payables Provisions Convertible notes		422,946 46,013 -	368,977 20,224 69,387
Total current liabilities		468,959	458,588
Total liabilities		468,959	458,588
Net assets		257,937	2,833,921
Equity Issued capital Distribution reserve Foreign exchange translation reserve Accumulated losses	3	6,645,495 (309,421) (38,085) (6,040,052)	6,620,495 (309,421) (41,272) (3,435,881)
Total equity		257,937	2,833,921
Net tangible assetsper security		$0.0005	$0.008

• See chapter 19 for defined terms

Appendix 4E

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Appendix 4E Preliminary final Report

Consolidated Cash Flow Statement

For the year ended 30 June 2017

	Note s	for the year ended 30 June 2017 $	for the 6 months ended 30 June 2016 $
Cash flows from operating activities Interest received Other income Payments to suppliers & employees Interestpaid		4,204 39,824 (2,422,341) -	- - (175,891) (1,016)
Net cash flows used in operating activities		(2,378,313)	(176,907)
Cash flows from investing activities Net cash acquired on acquisition of subsidiary		-	925,379
Net cash flows from investing activities		-	925,379
Cash flows from financing activities Proceeds from issue of shares Convertible notes repaid Distribution to owners Share issue costs		- (69,387) - -	3,000,000 - (309,421) (408,464)
Net cash flows(used in)/from financing activities		(69,387)	2,282,115
Net increase/(decrease) in cash held Cash and cash equivalents at beginningofperiod		(2,447,700) 3,097,751	3,030,587 67,164
Cash and cash equivalents at end ofperiod	1	650,051	3,097,751

• See chapter 19 for defined terms

Appendix 4E

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Appendix 4E Preliminary final Report

Consolidated Statement of Changes in Equity

For the year ended 30 June 2017 and the 6 months ended 30 June 2016

	Issued Capital $	Foreign Currency Translation reserve $	Distribution reserve	Accumulated losses $	Total equity $
At 31 December 2015	329,092	(43,917)	-	(594,788)	(309,613)
Loss for the six month period Issue of shares, net of costs Other comprehensive income Distribution to owners	- 6,291,403 - -	- - 2,645 -	- - - (309,421)	(2,841,093) - - -	(2,841,093) 6,291,403 2,645 (309,421)
At 30 June 2016	6,620,495	(41,272)	(309,421)	(3,435,881)	2,833,921
Loss for the year Share based payment Other comprehensive income	- 25,000 -	- - 3,187	- - -	(2,604,171) - -	(2,604,171) 25,000 3,187
At 30 June 2017	6,645,495	(38,085)	(309,421)	(6,040,052)	257,937

• See chapter 19 for defined terms

Appendix 4E

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Appendix 4E Preliminary final Report

1. Reconciliation of cash

Reconciliation of cash at the end of the period (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows:	As at 30 June 2017 $	As at 30 June 2016 $
Cash at bank	650,051	3,097,751
Total cash at end ofperiod	650,051	3,097,751

2. Dividends paid and proposed

No dividends have been paid or proposed during the year.

3. Issued capital

	as at 30 June 2017 $	as at 30 June 2016 $
Ordinaryshares(net of issue costs)	6,645,495	6,620,495

	Number of shares	$
At 30 June 2016	551,996,585	6,620,495
Issue of shares	833,334	25,000
At 30 June 2017	552,829,919	6,645,495

4. Group structure

Companies within the BARD1 Life Sciences Group (all wholly owned) carry out designated activities:

BARD1 Life Sciences limited – Holding Company BARD1AG – development of the BARD1 Lung Cancer Test

• See chapter 19 for defined terms

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Appendix 4E Preliminary final Report

5. Events subsequent to the balance date

In July 2017, the Company successfully completed a Placement of 137,165,811 BD1 shares to sophisticated and professional investors at $0.008 to raise $1.097M (before costs), followed by a Share Purchase Plan (SPP) to eligible shareholders that placed 52,000,000 shares at $0.008 to raise $416K (before costs). The total funds raised in the combined Placement and SPP were $1.513 million (before costs). The Company now has 741,995,731 ordinary shares on issue.

On 20 July 2017, BARD1 LSL announced that it had appointed international respiratory medicine expert, Dr Samuel Janes, as a member of its Advisory Board. Dr Janes will provide independent scientific and clinical advice to guide the Company’s research, development and business programs.

On 28 July 2017, Australian Patent no 2011292809 titled “BARD1 isoforms in lung and colorectal cancer and use thereof” was granted by IP Australia.

On 7 August 2017, a key paper on the original POC Study results and underlying scientific methodology for the BARD1 Lung Cancer Test was published in international peer-reviewed journal PLoS ONE.2.

Other than as noted above no matters or circumstances have arisen since the end of the financial 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.

6. Annual meeting

(Preliminary final report only)

The annual meeting will be held as follows:

Place	45 Ventnor Avenue, West Perth WA
Date	On or before 30 November 2017
Time	TBA
Approximate date the+annual report will be available	On or before 30 October 2017

2 Pilyugin M, Descloux P, André P-A, Laszlo V, Dome B, Hegedus B, et al. (2017) BARD1 serum autoantibodies for early detection of lung cancer. PLoS ONE 12(8): e0182356. https://doi.org/10.1371/journal.pone.0182356 + See chapter 19 for defined terms

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Appendix 4E Preliminary final Report

Compliance statement

• 1 This report has been prepared in accordance with AASB Standards, other AASB authoritative pronouncements and Urgent Issues Group Consensus Views or other standards acceptable to ASX.

• 2 This report, and the[+] accounts upon which the report is based (if separate), use the same accounting policies.

• 3 This report does give a true and fair view of the matters disclosed.

• 4 This report is based on[+] accounts to which one of the following applies. (Tick one)

• The +accounts have been  The +accounts have been audited. subject to review.

• The[+] accounts are in the  The[+] accounts have not yet process of being audited or been audited or reviewed. subject to review

Sign here: Date: 31 August 2017

Print name: Peter Gunzburg Chairman

• See chapter 19 for defined terms

Appendix 4E

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