ORTHOCELL LIMITED — Capital/Financing Update 2019

Dec 3, 2019

==> picture [594 x 111] intentionally omitted <==

Placement and Share Purchase Plan

• Orthocell receives firm commitments for a A$13m Placement

• Demand for the Placement well in excess of funds sought with support from existing shareholders, new institutions and other sophisticated investors

• Share purchase plan for eligible shareholders for up to approximately A$5m

• Combined proceeds to be used to accelerate US, EU and AUS regulatory approvals and commercialisation of CelGro®; advance the commercialisation of Ortho-ATI® and scale up manufacturing facilities

Perth, Australia; 04 December 2019 : Regenerative medicine company Orthocell Limited (ASX:OCC, “Orthocell”, or the “Company”) is pleased to announce that it has received firm commitments for a A$13m placement (before costs) at A$0.50 per share (“Placement”) from professional and sophisticated investors, including existing shareholders.

The Company will also offer all existing eligible Australian, New Zealand and Hong Kong shareholders the right to participate in a Share Purchase Plan (“SPP”) to raise up to approximately A$5m (before costs) at A$0.50 per share.

Orthocell Managing Director Paul Anderson said: “The success of this transaction is an endorsement of Orthocell’s business strategy, progress in commercialising CelGro® and the exciting outlook for the Company as it drives it’s leading products into key markets. Orthocell is well placed to further progress regulatory approvals, establish commercial infrastructure and execute on its partnering strategy delivering significant shareholder value in the near term.”

Placement

The Company has received firm commitments for a A$13 million Placement (before costs) which will be settled through the proposed issue of 26 million fully paid ordinary Shares (“Shares”) at an issue price of A$0.50 per Share. The issue of Shares will be undertaken in a single tranche utilising the Company’s ASX Listing Rule placement capacity. 15,471,109 Shares will be issued under the Company’s existing ASX Listing Rule 7.1A capacity with the remaining 10,528,891 Shares issued within the Company’s existing ASX Listing Rule 7.1 capacity. All Placement Shares issued will rank equally with existing ordinary Shares on issue. The offer price of A$0.50 meets the requirement of ASX Listing Rule 7.1A.3, being greater than 75% of the 15-day VWAP ($0.566). Settlement is expected to occur on 10 December 2019 with the new Shares being issued on 11 December 2019.

Share Purchase Plan

Eligible shareholders will also have an opportunity to subscribe for new Orthocell Shares, by way of a nonunderwritten SPP, at the Placement price of A$0.50 per share (without incurring brokerage or transaction fees).

Under the SPP, each eligible shareholder on Orthocell’s register at 5:00pm (AEDT) on 3 December 2019 (Record Date), and whose registered address on the share register is in Australia, New Zealand or Hong Kong, will be entitled to acquire up to A$30,000 worth of new Shares in the Company. An SPP Offer Booklet with further details of the SPP will be sent to eligible shareholders shortly. The Orthocell Board reserves the right to scale back applications and / or close the offer early and to place any shortfall from the SPP at is absolute

Ph: +61 8 9360 2888 Fax: +61 8 9360 2899 www.orthocell.com.au

==> picture [594 x 111] intentionally omitted <==

discretion. The timetable for the SPP offer set out below is indicative only and Orthocell may, at its discretion, vary any of the below dates by lodging a revised timetable with the ASX. The commencement of trading of new Shares is subject to confirmation from the ASX.

Use of funds

Funds raised from the Placement and SPP will be used primarily to accelerate regulatory approvals and commercialisation of CelGro® for bone, tendon and nerve regeneration following recent successful clinical results and growing demand from industry leading clinicians and potential partners for superior regenerative medicine medical devices. In addition, funds raised will be utilised to advance the development and commercialization of Ortho-ATI®, support continued business development and marketing initiatives and for general working capital purposes as follows:

1. CelGro® for Bone, Nerve and Tendon applications:

Commercialisation into US, EU and AUS focusing on regulatory approvals, establishing commercial infrastructure and execution of the marketing strategy:

• completing US (510K) and AUS (TGA) approvals for CelGro bone regeneration (Dental);

• establish the regulatory infrastructure to accelerate approvals in US, EU and AUS (Nerve/Tendon);

• establish the commercial infrastructure for initial commercialisation into key markets; and

• implementing the marketing strategy including expansion of clinician advocacy program with Key Opinion Leaders, growing product adoption and use in centres of excellence in target jurisdictions, publication and presentation of clinical data at key conferences and in high impact industry journals

2. Ortho-ATI®:

Commercialisation into US with collaboration partner (J&J) or other party focusing on:

• completion of Australian Ortho-ATI vs Corticosteroids clinical study for treatment of rotator cuff tendinopathy in conjunction with collaboration partner;

• completion of Australian Ortho-ATI vs. Surgery clinical study for treatment of tennis elbow; and

• file IND submission and RMAT application to the FDA.

3. Manufacturing scale up and automation:

Expansion of CelGro production team and processing facilities including automation infrastructure and quality control systems.

Proposed timetable for the SPP

The proposed timetable for the Placement and SPP is as follows:

Event	Date
SPP Record Date	5pm AEDT,Tuesday,03 Dec 2019
Announcement of Placement and SPP and	Wednesday, 04 Dec 2019
Companyresumes trading
Release of SPP Offer Booklet	Friday,06 Dec 2019
SPP OpeningDate	Friday,06 Dec 2019
Settlement of Placement New Shares	Tuesday,10 Dec 2019
Allotment of Placement New Shares	Wednesday,11 Dec 2019
SPP ClosingDate	5pm AEDT,Monday,23 December,2019
Announcement of SPP results	Friday,27 December,2019
Allotment of SPP New Shares	By12pm AEDT,Monday,30 December,2019

Ph: +61 8 9360 2888 Fax: +61 8 9360 2899 www.orthocell.com.au

==> picture [594 x 111] intentionally omitted <==

As a result of this announcement, Orthocell will resume trading from the commencement of trading today. Bell Potter acted as sole Lead Manager to the equity raising.

Updated key catalysts

The Company is accelerating commercialization of CelGro for tendon and nerve regeneration following recent successful clinical results and growing demand for superior products from industry leading clinicians and potential partners. A summary of upcoming catalysts for OCC is outlined below:

CelGro – Bone Regeneration(Dental)	Date
Roll out European advocacy program	ONGOING
Australian market authorisation	2QCY2020
US market authorisation	4QCY2020
CelGro – Nerve Regeneration
Approval to commence FDA study	4QCY2019
Complete FDA study and submit 510K application	3Q CY2020
TGA(AUS)submission	1QCY2020
CE Mark(EU)submission	2QCY2020
CelGro – Tendon Regeneration
TGA(AUS)submission	1QCY2020
Approval to commence FDA study	2QCY2020
Complete FDA study and submit 510K application	1Q CY2021
CE Mark(EU)submission	2QCY2020
Ortho-ATI
Investigational New Drugsubmission FDA	1QCY2020
Complete J&J studyrecruitment	1QCY2020
Strategicpartnership discussions ongoing for allproducts

Ph: +61 8 9360 2888 Fax: +61 8 9360 2899 www.orthocell.com.au

==> picture [594 x 111] intentionally omitted <==

Paul Anderson, Managing Director Orthocell Ltd

For more information, please contact:

General & Investor enquiries

Media enquiries

Paul Anderson Haley Chartres Orthocell Limited Hales2Consultancy Managing Director P: +61 8 9360 2888 P: +61 423 139 163 E: paulanderson@orthocell.com.au E: haley@h-squared.com.au

About Orthocell Limited

Orthocell is a regenerative medicine company focused on regenerating mobility for patients by developing products for the repair of a variety of soft tissue injuries. Orthocell’s portfolio of products include CelGro®, a collagen medical device which facilitates tissue repair and healing in a variety of orthopaedic, reconstructive and surgical applications. Orthocell recently received European regulatory approval (CE Mark) for CelGro®. The collagen medical device can now be marketed and sold within the European Union for a range of dental bone and soft tissue regeneration procedures and is being readied for first approval in the US and AUS. The Company’s other major products are the TGA-licensed cell therapies Autologous Tenocyte Implantation (Ortho-ATI®) and Autologous Chondrocyte Implantation (Ortho-ACI®), which aim to regenerate damaged tendon and cartilage tissue. Orthocell is moving forward with clinical studies designed to assist in the US (FDA) approval process and has completed its pre-IND meetings with the FDA.

For more information on Orthocell, please visit www.orthocell.com.au or follow us on Twitter @Orthocellltd and LinkedIn www.linkedin.com/company/orthocell-ltd

Forward Looking Statements

Any statements in this press release about future expectations, plans and prospects for the Company, the Company’s strategy, future operations, and other statements containing the words “anticipate,” “believe,” “estimate, ”expect,” “intend,” “may,” “plan,” “predict,” “project,” “target, ”potential,” “will,” “would,” “could,” “should,” “continue,” and similar expressions, constitute forward-looking statements. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: the Company’s ability to successfully develop its product candidates and timely complete its planned clinical programs and the Company’s ability to obtain marketing approvals for is product candidates. In addition, the forward-looking statements included in this press release represent the Company’s views as of the date hereof. The Company anticipates that subsequent events and developments will cause the Company’s views to change. However, while the Company may elect to update these forwardlooking statements at some point in the future, the Company specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to the date hereof.

Ph: +61 8 9360 2888 Fax: +61 8 9360 2899 www.orthocell.com.au