Cellmid 2018 Annual Report 17

ii. Midkine Business (Lyramid Limited and Kinera Limited)

Nature publication and 5th Midkine Symposium conﬁrms clinical potential for midkine antibody assets

In August 2017 Cellmid reported the publication in Nature of the results of a signiﬁcant study showing for the ﬁrst time

that midkine, around which the Company holds extensive intellectual property rights, is a crucial agent in the promotion of

melanoma metastasis. The paper, entitled “Whole-body imaging of lymphovascular niches identiﬁes pre-metastatic roles of

midkine”, by Professor Marisol Soengas and her group based in CNIO in Madrid, describes how midkine drives the often-

fatal metastatic spread of melanoma cells from the primary tumour in the skin to distant organs such as liver, lung, bone and

brain. This independent study reinforced midkine’s strong clinical potential in cancer.

In May 2018 the Group held its 5th Midkine Symposium in Munich, Germany. New research ﬁndings on midkine and midkine

inhibitors were revealed across 38 presentations by scientists from 13 countries. Highlights of the Symposium included

themed sessions on the role of midkine in cancer (12 talks), cardiovascular biology (6 talks), and tissue injury responses (7

talks), as well as neural development and CNS disorders (6 talks). Many speakers highlighted and expanded upon research

recently published in top ranking and prestigious journals including Nature, Cell, Cell Reports, Science Signalling and

Science Reports, which contributed to a high-quality scientiﬁc meeting.

The high quality of recent publications is reﬂective of the improved understanding of the importance of midkine in many

disease processes. Signiﬁcantly, the Symposium revealed new evidence around midkine’s role as a critical mediator of cell

communication and inter-organ signalling in cancer and inﬂammatory diseases highlighting the potential clinical applications

for the Group’s antibodies.

iii. Signiﬁcant changes in state of affairs

On 31 July 2018 the Group completed a private placement of shares to sophisticated and institutional investors and

received ﬁrm, irrevocable commitments for $9 million equity funding (before costs). Costs of the offer included the issuing of

1,000,000 options to the lead manager, Blue Ocean Equities, at a nil issue price, an exercise price of $0.80 and a term of 3

years. Approximately $7.2 million of this funding was subject to shareholders’ approval. The Group held a general meeting of

the shareholders on 7 September 2018 where the issuing of the shares pursuant to the placement was approved.

On 31 July 2018 the Group announced a Share Purchase Plan (SPP) to the amount of $1 million. The Share Purchase Plan

closed on 30 August 2018 raising $1,025,000.

Update on the Ikon legal action

On 22 July 2016, the Group announced that Ikon Communications Pty Ltd (Ikon) had ﬁled a claim for an amount of

$939,055 plus interest pursuant to the services agreement entered into between Group Company Advangen International

Pty Ltd (Advangen) and Ikon on 15 June 2015, being a claim for invoices which Advangen has not paid to Ikon. Advangen

continued to vigorously defend its position that it is not liable for those unpaid invoices because Ikon has breached the

services agreement, failed to provide certain contractually required services at all or adequately and engaged in misleading

or deceptive conduct that has caused Advangen loss and damage. Advangen ﬁled a cross claim for payments made for

services not provided or not properly provided by Ikon, plus other loss it says it suffered by reason of Ikon’s conduct and

submitted evidence, including expert evidence, to that effect during the reporting period. The proceedings (Ikon’s claim and

Advangen’s cross claim) began hearing in the New South Wales Supreme Court on 10 September 2018.

3. FINANCIAL REVIEW

Financial position

The net assets of the Group at 30 June 2018 were $1,855,172 ($4,071,026 at 30 June 2017) while current assets decreased to

$4,159,083 ($5,562,302 at 30 June 2017). With the capital raising of $10 million after the closing of the reporting period the

Directors believe that the Group is in a very strong ﬁnancial position to carry out its current and planned operations.

4. OTHER ITEMS

Signiﬁcant changes in state of affairs

There have been no signiﬁcant changes in the state of affairs of the entities in the Group during the 2018 ﬁnancial year.

Dividends paid or recommended

The Company has not paid or declared any dividends during the ﬁnancial year (2017: Nil).