Preparing for Success | Annual Report and Accounts 2019

Oxford Biomedica plc | Preparing for success | Annual report and accounts 2019

Preparing for success

Annual report and accounts 2019 Oxford Biomedica in brief Oxford Biomedica is a pioneer of gene and cell therapy with a leading position in lentiviral vector research, development and bioprocessing. Gene and cell therapy is the treatment of disease by the delivery of therapeutic DNA into a patient’s cells. This can be achieved either in vivo (referred to as gene therapy) or ex vivo (referred to as cell therapy), the latter being where the patient’s cells are genetically modified outside the body before being re-infused. Oxford Biomedica is focused on developing life changing treatments for serious diseases. Oxford Biomedica and its subsidiaries (the “Group“) have built a sector leading lentiviral vector delivery system, LentiVector® platform, which the Group leverages to develop in vivo and ex vivo products both in-house and with partners. The Group has created a valuable proprietary portfolio of gene and cell therapy product candidates in the areas of oncology, ophthalmology, liver and CNS disorders. The Group has also entered into a number of partnerships, including with Novartis, Bristol Myers Squibb, Sanofi, Axovant Gene Therapies, Orchard Therapeutics, Boehringer Ingelheim, the UK Cystic Fibrosis Gene Therapy Consortium and Imperial Innovations, through which it has long- term economic interests in other potential gene and cell therapy products. 1 Preparing for success Oxford Biomedica is based across several locations in Oxfordshire, UK and 3 Demand in the gene and cell therapy sector is reaching employs more than 550 people. new heights 7 An area bursting with activity 11 Leading industrialisation

15 Strategic report 16 Group at a glance 18 Products pipeline 20 The Group's business model 22 The Group’s stakeholders 24 Operational highlights delivered in 2019 25 Financial highlights delivered in 2019 26 Chairman’s statement 28 Chief Executive Officer’s and 2019 performance review 34 Management team 36 Delivery of 2019 objectives 37 Objectives set for 2020 38 Financial review 48 Responsible business 55 Non-financial statement

57 Corporate governance 58 Principal risks, uncertainties and risk management 63 Board of Directors 66 Corporate governance report 76 Directors’ remuneration report 94 Directors’ report

101 Independent auditors’ report

109 Group financial statements 110 Consolidated statement of comprehensive income 111 Statement of financial positions 112 Statements of cash flows 113 Statements of changes in equity attributable to owners of the parent 114 Notes to the consolidated financial statements

151 Other matters 151 Glossary 154 Advisers and contact details Oxford Biomedica plc|Annual report andaccounts2019 Preparing for success growth sector A leaderinarapid its impactandsuccess. science ashealthcare’s future. TheGroup isnowpreparing tomaximise Oxford Biomedicahasplayedanimportantrole indevelopingthis Leading industrialisation commercial treatments. therapies indevelopment–allcompetingtodeliverthenextgeneration The sectorisrapidlyexpandingwithanever-increasing amountof newgene An areaburstingwithactivity for patients, curingdiseaseandchanginglives. Interest in gene and cell therapies is booming. It's become a reality; working Demand isreachingnewheights vectors towar Read mor capacity tomeetincr Read mor is deliveringthefutur Read mor e about how the Group is moving Lentiviral e abouthowtheGroup ismovingLentiviral e abouthowtheGroup isexpanding e abouthowourLentiVector ds criticalmassonpage12. e of medicinetodayonpage4. easing demandonpage8. ® delivery system deliverysystem

Preparing for success 1 2

Approvals Clinical trials 20 20 18

16 Approvals 20251 1,000 The FDA is anticipating 14 approvals rising to 900 2 between 10 and 20 12 700 a year by 2025 10 600

500 8 987 1,020 400 0 925 6 300 4 4 533 Approvals today 200 There have so far been eight 2 2 2 100 gene therapy products approved for use by the FDA, 0 0 four of them in 2019 0

2016 2017 2018 2019 2025

Clinical trials underway worldwide Both submissions and approvals have been increasing steadily and are now expected to accelerate imminently2 Sources: 1 FDA,2 Alliance of Regenerative Medicine.

Oxford Biomedica plc | Annual report and accounts 2019 3

Preparing for success

Preparing for success Demand in the gene and cell therapy sector is reaching new heights

Oxford Biomedica plc | Annual report and accounts 2019 4 Preparing for success Demand in the gene and cell therapy sector is reaching new heights

The Group is in a perfect position to exploit an exciting global opportunity

The fast growing cell and gene therapy market “ We anticipate that by 2020 The cell and gene therapy market continues to grow strongly we will be receiving more post the first approval of a CAR-T therapy in the market with than 200 INDs (in gene and Novartis’s Kymriah® in August 2017. Since then four further cell cell therapy products) per year, and gene therapy products have been approved and growth in building upon our total of clinical trials in the area has grown substantially. more than 800 active The cell and gene therapy market is expected to grow to cell-based or directly a multi-billion dollar market and the total number of gene administered gene therapy therapy and gene-modified cell therapy trials has increased INDs currently on file with from 533 in 2016 to 1,020 in 2019 representing a CAGR 17.6%. the FDA. And by 2025, we The US Food and Drug Administration in anticipation of this growth has stated their intension to hire 50 additional clinical predict that the FDA will be reviewers to handle the increase in submissions and the FDA approving 10 to 20 cell and estimates that by 2025 they will be approving 10 to 20 cell and gene therapy products gene therapy products a year. a year.”

Cell and Gene therapies use vectors to deliver genetic Scott Gottlieb M.D. information into a patient’s cells. There are two types of vector Former FDA Commissioner 15 January 2019 most commonly used lentiviral based vectors (LV) and adeno- associated virus based vector (AAV). Global clinical trials with lentiviral vectors have grown faster than any other type and are the largest numerically having grown from 23 clinical trial initiations in 2014 to 57 in 2018 (CAGR 25.5%).

60 Lentivirus AAV 57 50 53

30 32 30 28 28

20 24 23 23 18 10

0 2014 2015 2016 2017 2018

Number of trials using each vector type (global)

Oxford Biomedica plc | Annual report and accounts 2019 Oxford Biomedica plc|Annual report andaccounts2019 CAR-T/TCR-T programmes, includingNovartis’Kymriah in April2020. IntotaltheGroup isworkingwithpartnerson10 the firstquarter of 2020and COVID-19 vaccineprogramme 2020, aswelltheadditionalprogramme from Novartisin programmes onsigningwithBristolMyersSquibbinMarch in vivo programmes. This increased by an additional four programmes intheirpipelinecomprisingeightexvivoandfive As at theendof December2019thecompanyhad13partner generation ofmedicaladvances Lentivector what makes these newtreatments work. they usetheGroup’s intellectualproperty asanintegralpartof royalties oncetreatments are approved andavailable for use as development andmanufacturingservices,aswellfrom The Group generates revenue from providing itsprocess challenging orcostlytopursue. to expandintoareas otherwisedeemedtootechnically is abletoenableitspartnersaswellinhouseprograms to expand the reach of gene therapy means Oxford Biomedica This expertiseandthecontinualinnovation across theplatform respiratory disease. therapies, oculardiseases,CNSdisorders, liverdiseasesand also multipletherapeuticareas coveringgenemodifiedcell vectors notonlyspansinvivoandex vivo programmes but Oxford’s Biomedica’sunparalleledexpertisewithlentiviral first FDA andEMAapproved CAR-T therapy. LentiVector www.oxb.com/bioprocessing manufacturing br Examples o f how our technology works can be found in our f howourtechnologyworks canbefound inour ® ® gene delivery system – enabling the next system–enablingthenext genedelivery platform works platformworks ochure whichcanbedownloadedhere: 1 2 3 5 ex vivo ® , the , the

4 4 2 3 5 1 undertak the partner. Scaleupisthen receptor (CAR)asrequired by for aspecificchimericantigen CAR-T therapythisgeneencodes vector genome.Inthecaseof cells are engineered intothe need tobedelivered tothetarget vector payload.Thegene/sthat creates spacefor thetherapeutic viral genesare removed; thisalso To make asafe vectorsystemthe needs virus specifictothepartners Making asafe vectorfroma therapy the NovartisKymriah system –howitworksfor T is themshippedtothepartner. confirmatory assaysthevector production andmultiple on B-cell cancers.Postbatch targeting CD19whichisexpressed lentiviral vectorencodesfor aCAR disease. guard againstresidual orrecurring CD19) andpersistinthebodyto Lentivector (CAR) tar for thechimericantigenreceptor lentiviral vectorwhichencodes produce abatch of thespecific 200L bioreactors are usedto vector Production ofGMPlentiviral to acommercial 200Lscale. Kymriah the antigen(incaseof destroy thetarget cellsexpressing specific antigentargeting T-Cells them andthenmultiply ‘hunt’ cancercellsanddestroy CAR modified T-cells target Once insidethepatient, the back intothepatient The modified T-cells areinfused into thepatient. expanded The resulting modified T-cells are vector encodingthespecificCAR. are transducedwiththelentiviral T-cells harvestedfrom thepatient T are usedtotransduceexpanded targeting thespecificantigen Lentiviral vectorencodingCAR collection andT-cell isolation. The partnerarrangespatient blood cell. InKymriah antigen inquestiononthetarget -cells -cells isolatedfrompatient ® geting the particular geting theparticular en to take the production en totake theproduction tumour cells expressing tumourcellsexpressing prior to infusion ex vivopriortoinfusion ® gene delivery genedelivery ® for example the for examplethe ® . These . These CAR-T

Preparing for success 5 6

With the addition of two new facilities, Oxford Biomedica has more than doubled its footprint

Oxford Biomedica plc | Annual report and accounts 2019 7

Preparing for success

Preparing for success An area bursting with activity

Oxford Biomedica plc | Annual report and accounts 2019 8 Preparing for success An area bursting with activity

Lentiviral vectors have several important advantages over AAV

A key advantage of the family of vectors that includes lentiviral vector is their ability to integrate into the DNA of target cell so 6 years that the genetic information will be copied as cells divide so Lentiviral vectors demonstrate that this becomes a permanent modification. This is essential long term expression for ex vivo therapies; while AAV vectors have some ability to Lentiviral vectors have demonstrated dose dependant, stable, long term expression out more than 6 years* integrate this is limited and hence are currently only used following a single in vivo administration. in vivo applications in cells with limited or no cell division. *Campochiaro et al. Lentiviral vectors can carry about twice the genetic payload Hum Gene Ther 28 (1):99-111, 2016 compared to AAV, this allows for the carriage of larger genes (up to 10kb) and/or the carriage of more than one gene. This capability for example has been used with Parkinson’s disease programme, Axo-Lenti-PD which contains three genes. This programme was developed in house before being out-licenced to Axovant in 2018. There is no pre-existing immunity for lentiviral vectors and hence no pre-screening is needed.

Lentiviral Vectors AAV Vectors

Efficientin vivo gene delivery

Safe and well tolerated

Large therapeutic payload

No pre-existing immunity

Permanent modifications of dividing cells

IP protection

Ease of manufacture

Lentiviral vectors vs. AAV vectors Lentiviral vectors such as the Group's Lentivector® delivery system hold some key advantages over AAV vectors.

Yes Good Excellent No

Oxford Biomedica plc | Annual report and accounts 2019 9

Significant additional capacity will match

global demand Preparing for success Oxbox Bioprocessing facility As the cell and gene therapy field continues to expand, the Group leased an additional facility in Oxford at the end of 2018 to meet the anticipated higher demand for lentiviral vectors. The new 84,000 sqft (7,800 sqm) facility, Oxbox, complements Oxford Biomedica’s three existing state-of-the-art GMP

production suites. The initial development phase will fit out approximately 45,000 sqft (4,200 sqm) in the new facility with four GMP clean rooms, two fill / finish suites, offices, warehousing and QC laboratories. During 2019, facility development made good progress, with the production suites’ building phase completed by the end 2 of the year as planned. Validation commenced at the start of 2020, and the Group anticipates achieving regulatory approval 1 and manufacture of the first commercial batches by the end of the first half, 2020. In parallel, development of the fill / finish suites are progressing well, with handover of the first suite expected by the end of 2020.

Windrush Innovation Centre Alongside the expansion of Oxford Biomedica’s manufacturing capacity, the Group is in the process of establishing the 3 Windrush Innovation Centre (WIC), a new 32,000 sqft (2,970 sqm) discovery and innovation hub. This brings together research, automation, process development and bioprocessing teams to drive LentiVector® platform innovation and progress the proprietary pipeline. Occupation of the facility began during the first half of 2019 with increased utilization Expanding capacity The images above show three of the Group's expected during 2020. five facilities in Oxford. With the addition of these two new facilities, Oxford Biomedica 1 Shown in the top image is the Group's Windrush has more than doubled its footprint, which now extends to headquarters (building complex on the right). 2 The new Windrush Innovation centre is over 226,000 sqft (21,000 sqm). With its five specialist facilities next door to the Group's headquarters centred around Oxford, the Group has built a global hub for (building complex on the left). lentiviral vector development and commercialisation. 3 The bottom image is the Group's new Oxbox facility.

Oxford Biomedica plc | Annual report and accounts 2019 10

Driving cost down through industrialisation Oxford Biomedica is working to reduce manufacturing costs, already making progress and setting new standards

Mass markets Activity

Time

2017 First ever gene Availability of treatments therapy treatment Clincial trials will gather pace and approved by the FDA using our LentiVector® more and more treatments will delivery system become available

Oxford Biomedica plc | Annual report and accounts 2019 11

Preparing for success

Preparing for success Leading industrialisation

Oxford Biomedica plc | Annual report and accounts 2019 12 Preparing for success Leading industrialisation

Driving lentiviral vectors towards critical mass

Proprietary platform innovation The LentiVector® platform – leading commercial lenti-based Through proprietary platform innovation the Group is driving delivery system: 1 Process development the industrialisation of lentiviral vectors. The Group is able State-of-the-art facilities spread over 12,000 sqft (1,115 sqm) and to leverage our expertise to deliver lentiviral vector based 2 sites. Serum-free suspension gene therapies. The Group’s CDMO revenues provide a solid bioreactor process. growing financial foundation with significant upside from the 2 Cell and vector engineering Optimised cell lines for simplified Group’s proprietary pipeline. and scalable manufacturing. Next generation vectors with pseudotyping expertise. Access What the sector urgently needs to do: How Oxford Biomedica is answering this: to EIAV and HIV-1.

3 TM 1 SecNuc Efficient clearance of residual Process DNA during vector production. development Streamlines vector production up produ eed ctio and reduces cost of goods. Sp n 2 6 TM ialis Cell and ovat 4 str at n io TRiPSystem u io In n d n vector Analytics Repression of transgene during n engineering I

vector production. Maximises yields

and improves product quality.

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y manufacturing process. 6 Analytics Analytical methods recognised by regulatory authorities. Quality systems ensuring compliant release 4 of batches. Automated systems increase efficiency and reproducibility.

Oxford Biomedica plc | Annual report and accounts 2019 Oxford Biomedica plc|Annual report andaccounts2019 lentiviral basedgenetherapytreatments. become afirstchoicetechnology for anyone developing Biomedica iscommittedtodrivingcostsdown, enablingit its LentiVector The Groupcontinuouslyinnovatestoimprove rapidly growing geneandcelltherapysector. Oxford Biomedicacancapture significantvaluefrom the By spearheadingtheindustrialisation of thelentiviralvector, The Group’s LentiVector offering the prospect of long-termsustainablegrowth. process. Thisprovides auniquelydiversifiedbusinessmodel spans theentire product developmentandcommercialisation brings togetherinnovation, expertiseandinfrastructure that position asaworldleadinglentiviralvectorcompany. TheGroup As apioneerinitsfield,Oxford Biomedicahasbuiltanenviable the costofgenetherapydown Continuous innovationisdriving LentiVector intelligence collaboration with Microsoft, maintains the investment, suchasthrough theGroup’s newartificial operational efficiencyanddrivingdowncosts,whilstongoing and in-housepipeline.Constantinnovation isaccelerating of the lentiviralvector, andunderpinsbothitspartnerships edge technologiesintotheLentiVector In collaborating with innovative companies to integrate cutting — — — partnership withMicrosoft signedin2019. drive developmentandinnovation viatheGroup's new using while reducing developmenttimingsandprocess risk, art manufacturingtechnologiesincreases productivity development andanalyticaltesting. faster celllinescreening aswellhighlyefficient process increase efficiencyandquality, investinginautomation. bioprocessing yield,developingnewanalyticalmethodsto The Gr The Gr Engineering ourpr design tools and machine learning to in silicodesigntoolsandmachinelearningto oup's investmentinrobotics andstate-of-the- oup's automated systems are already enabling oup's automated systemsare already enabling ® platform’s world-leadingposition. ® platform by: platformby: oprietary cell lines and vectors to improve oprietary celllinesandvectorstoimprove ® platform enables the industrialisation platform enables theindustrialisation

® platform, Oxford platform, Oxford

development andanalyticaltesting. cell linescreening aswellhighlyefficient process Our automated systemsare already enablingfaster Automation androbotics are unlockingproductivity. Investment innewtechnologies

Preparing for success 13 14 disease and changing lives. disease andchanginglives. working forpatients,curing Today genetherapyisareality; available treatments. which thereisnoeffective and debilitatingdiseasesfor suffering fromlifethreatening something betterforpeople hope; thatthefuturecouldbring For decades,genetherapywasa moment. Healthcare standsatapivotal Oxford Biomedica plc|Annual report andaccounts2019

109 101 151 154 110 11 112 113 151 111 48 94 20 66 28 38 58 26 34 63 36 57 2 15 22 25 55 76 37 18 16 11 4 4 4 3 1 7

new heights cell therapysectorisreaching in 2019 delivered highlights Financial delivered in2019 highlights Operational The Gr The Gr Pr Gr Strategic report Leading industrialisa An ar Advisers andcontactdetails Glossary Other matters financial statements Notes totheconsolida of theparent equity attributable toowners S S positions S of comprehensive income statement Consolidated Group financialstatements report auditors’ Independent Dir Dir Corpora Boar and riskmanagement uncertainties risks, Principal Corporate governance statement Non-financial Responsible business review Financial Objectives setf Delivery o Management team 2019 performance review Chief Ex Chairman’s sta Demand inthegeneand Preparing forsuccess tatements of changes in tatements of changesin tatements of cashflows tatement of financial oducts pipeline oup at aglance ectors’ report ectors’ remuneration report d of Directors ea burstingwithactivity oup’s stakeholders oup's businessmodel ecutive Officer’s and ecutive Officer’sand te governancereport f 2019objectives tement or 2020

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Strategic report 15 16 Group ataglance Strategic report Oxford Biomedica plc|Annual report andaccounts2019 A firstchoicepartner — — Over550staff. — Eightproprietary products candidates. — 19partnerprogrammes. specialist with: The Group isaleadinggloballentiviralvector on Kymriah. Group’s collaborationwithNovartis systemthroughthe gene delivery approved lentiviralvector-based The GrouphasthefirstFDA andEMA the wayinlentiviralvectors. therapy sectortheGroupisleading In thefastgrowingGeneandCell Who theGroupis (21,000 sqm). F acilities coveringinexcess of 226,000 sqft ® CONSORTIUM GENE THERAPY UK CYSTIC FIBROSIS and MHRAappr Yarnton iswhere theGroup’s facilityhasFDA Yarnton, Oxford,UK located directly oppositeourheadquarters. Harrow HouseandChanceryGate are r The Group’s Harrow Housefacilityfirst Oxford, UK Gate, Harrow HouseandChancery laboratory andoffice space. a further32,000 (2,970 sqm)sqftof door isournewInnovation Centre whichhas 32,000 sqft(2,970 sqm)of labspace.Next Windrush Courtfacilitywhichalsohouses The Group’s headquartersare withinour Centre, Oxford,UK Windrush CourtandInnovation therapy hotspots forgeneandcell Oxford isoneoftheglobal Where theGroupis Oxford locations. over 550peopleat theGroup’s Oxford Biomedicaemployes Employees >550 London Hea Facilities lessthanonehourfrom Oxford, UK significant future expansion. Fill andFinishsuites.Thefacilityhasroom for space toincludefour cGMPsuitesandtwo 45,000 sqft(4,200 sqm)of manufacturing out aportionof thisbuildingtoprovide facility isOxbo The Group’s newest84,000 sqft(7,800 sqm) Oxbox, Oxford,UK including onecleanroom. around 6,000 sqftof manufacturingspace, manufacturing spacewithtwocleanr in 2012.Ithasaround 4,000 sqftof eceived MHRA approval to manufacture eceived MHRAapproval tomanufacture

throw Airport. x. The Group is currently fitting x. TheGroup iscurrently fitting oval to manufacture. It has oval tomanufacture. Ithas

ooms. ooms.

London Heathrow Oxford Oxford Biomedica plc|Annual report andaccounts2019 lentiviral vectorbasedgenetherapies. The Group isabletoleverageourexpertisedeliver is drivingtheindustrialisation of lentiviralvectors. Through proprietary platform Innovation theGroup platforminnovation Proprietary fees andpotentialroyalties onfuture product sales. milestone payments,developmentandproduction with multipleincomestreams, consistingof upfront and expertise.Thesepartnershipsprovide theGroup intellectual property, state-of-the-art production facilities Therapeutics, providing themwithaccesstotheGroup’s Santen, theOxford COVID-19 consortiumandOrchard Gene TherapyConsortiumandImperialInnovations, Group), Boehringer Ingelheim,theUKCystic Fibrosis Bristol MyersSquibb,Bioverativ (partof theSanofi The Group hasstrong partnershipswithNovartis, CDMO andpartner’sprogrammes What theGroupdoes

Liver CNS Opthamology Oncology Indications: continuing toinvestintheGroup’s LentiVector via spin-outsandout-licensingopportunities,while The Group planstoprogress itswholly-ownedproducts ophthalmology, liverandCNSdisorders. cell therapyproduct candidates intheareas of oncology, the Group hascreated avaluableportfolio of geneand Using theGroup’s uniqueLentiVector Oxford Biomedica’sproducts to Sanofi andAxovant. The Group haslicensedproducts andtechnologyrights out orout-licencetoapartner. assets uptoearlyclinicalstagebefore lookingtospin to make modestinvestmentstointernalandexternal R&D todiscovernewpotentialproducts andare willing platform. TheGroup planstocontinueitspre-clinical

engineering Cell and Cell and vector vector Early clinical and Early clinicaland development manufacturing manufacturing manufacturing technologies commercial commercial Proprietary Proprietary Process Process ®

delivery platform, deliveryplatform, Analytics ®

Strategic report 17 18 Products pipeline Strategic report eight proprietary programmesofwhichthree have been out-licenced. eight proprietary The Groupiscurrentlyworkingon19partnerprogrammesandhas IP enabledandroyalty bearingproducts (process developmentandbioprocessing revenues, androyalties) LentiVector Product/ indication revenues androyalties onsalesonceatherapyhasreached themarket. inclining upfront licencefees, process developmentfees andincentives,bioprocessing 2018. Oxford Biomedica receives multiple revenues streams from its work with partners The Group isworkingwithpartnerson19programmes compared tonineat theendof CDMO Pipeline COVID-19 Vaccine Inherited retinal disease Ocular gene Cystic Fibrosis gene CFTR Haemophilia B Factor IX Haemophilia A Factor VIII Undisclosed Other MPS-IIIA OTL-201 ADA SCID OTL-101 Undisclosed 4th CAR-T/ TCR-T Undisclosed 3rd CAR-T/ TCR-T Undisclosed 2nd CAR-T/ TCR-T Undisclosed 1st CAR-T/ TCR-T Parkinson’s disease AXO-Lenti-PD Cancer (multiple) 6th CAR-T Cancer (multiple) 5th CAR-T Cancer (multiple) 4th CAR-T Cancer (multiple) 3rd CAR-T Cancer (multiple) 2nd CAR-T r/r ALL/DLBCL Kymriah Oxford Biomedica plc|Annual report andaccounts2019 Read more aboutourCDMOpipelineonpages28and29. ® ® platform Pre-clinical 6 CONSORTIUM GENE THERAPY UK CYSTIC FIBROSIS 4 Phase I 7 2 2 1 1 1 1 4 1 1 1 Phase I/II 5 9 1 1 Phase II

Phase III 3 Approved 1 Oxford Biomedica plc|Annual report andaccounts2019 To bespun-outorout-licensed products Oxford Biomedicaproprietary Development milestonesandroyalties Oxford Biomedicapartneredproducts Product/indication Pipeline indications milestones androyalties. been out-licenced. Revenuesfrom out-licenced programmes come intheform of upfront, The Group haseightprogrammes in its gene therapeutics pipeline of which three have Gene therapeuticspipeline

10 Liver indication OXB-401 ALS OXB-103 LCA10 OXB-204 Wet AMD OXB-203 Haematological malignancies OXB-302 Usher syndrome type1B SAR421869 Stargardt disease SAR422459 Parkinson’s disease AXO-Lenti-PD 4 8 9 6 2 3 5 7 1 1 T Hepatology In Central NervousS Respiratory Ophthalmology Neurology Metabolic Immunology Haematology Oncology on page30. Read more aboutourtheGroup’s genetherapeuticspipeline reatment approved fectious Disease ystem (CNS) Pre-clinical Phase I

10 8 6 6 2 Phase I/II 5 Phase II 6 6 Phase III Approved

Strategic report 19 20 The Group’sbusinessmodel Strategic report Oxford Biomedica plc|Annual report andaccounts2019 2 1 Gr ex vivotherapieshasmadethe in applyingitsLentiVector Group’s 20plusyearsof expertise know-how, alongwiththe Biomedica. TheIP, patents and is at theheartof Oxford Link torisks to expandfurtherastheyearprogresses. expects thepipelineof partnerships demand for its expertise. The Group facility, tomeettheincreasing new capacity, suchasitsOxbox continues itsgrowth itisbuilding Myers Squibb.AsOxford Biomedica and newpartnershipwithBristol supply agreement withNovartis recently extendedcommercial demonstrated bytheGroup’s ongoing repeatable revenues as a strong businessfoundation, bringing customer-centric partnershipsform Oxford Biomedica’shigh-value, solutions andcommercial supply. the leadingsupplierof scaleup its world-leadingcapabilitiesandis to provide partnerswithaccessto The Group leveragesitsposition grow from tento19programmes. seen itspartnerfundedpipeline vectors andinthelastyearhas commercial supplierof lentiviral FDA andEMAapproved Oxford Biomedicawasthefirst Organisation, (CDMO) and Manufacturing Contract Development Partner programmes: Link torisks advancement. this newwave of medical benefits of beinga key enablerin Oxford Biomedicatoreap the market tobereached andfor to enablethefullpotentialof this the cellandgenetherapymarkets Group’s technologyandIPacross the process of doingso seedthe industrialise lentiviralvectorandin investment andinnovation isto The Group’s missionthoughthis efficiency anddrivingdowncosts. will accelerate operational intelligence andmachinelearning with Microsoft inartificial alongside newcollaborations such investment intheplatform innovation andongoing technology. Thisconstant to remain at theforefront of this is key totheGroup’s successand further innovation ontheplatform it istoday. Lookingtothefuture, field butalsothegloballeaderthat The Group’s LentiVector LentiVector and technology for bothinvivoand oup not only a pioneer in the oup notonlyapioneerinthe A A C B ® platform C E E ® platform platform ®

tents andknow-how|facilitiesexpertisequalitysystems IP– LentiVector Partners’ programmes — Royalties — Bio-processing revenues — — Process developmentfees 19 CDMOpartner’sprogrammes Pr pa ocess developmentincentives Arising IP ® platform streams Multiple revenue 2 CONSORTIUM GENE THERAPY UK CYSTIC FIBROSIS scientific knowledgetransfer Arising IP & technical and Arising IP&technicaland — — Developmentfunding u-iecdpout Internalpipeline Out-licenced products royalties Upfr ont, milestones & ont, milestones& Out-licence Arising IP Eight gene therapeutics Eight genetherapeutics proprietary products — Whollyownedproducts 1 development Internal 4 3

Strategic report

3 OXB products 4 Proprietary internal Value creation for our stakeholders in 2019 (gene therapeutics) pipeline Whilst the Group’s partnerships Following an internal pipeline Shareholders are the foundation of a strong review priorities have now been The Group’s shareholders play an underlying business, its wholly- set for where investment will important role in monitoring and 200

owned gene and cell therapy be made. OXB-302 is the Group's safeguarding the governance of In 2019 we attended over 200 pipeline offers significant upside. priority candidate and targets the Group by ensuring their views Leveraging its internal research haematological tumours with a meetings in the investor are brought into Board community expertise developed over 20 CAR-T 5T4. The 5T4 antigen has discussions and considered years, the Group selects patient- been shown to be highly expressed in decision making. centric product candidates on various haematological targeting clinical excellence. tumours as well as most solid These are progressed through tumours with restricted Partners proof-of-concept, and expression on normal tissues. potentially into early clinical Advanced pre-clinical work is The Group will continue to target development, before seeking continuing on OXB-302 as the new strategic commercial 19 relationships in 2020, whilst third-party funding for full programme moves towards Partner programmes development and entry into the clinic. OXB-203, continuing to maintain the very commercialisation. This currently in pre-clinical studies, good relationship it has with its approach reduces risk while is targeting Wet AMD and uses existing partners. retaining significant value Oxford Biomedica’s technology through licence income, to deliver a gene to express Employees milestone payments and sales afibercept (a VEGF-trap). This royalties. Additionally, Oxford programme builds on the The Group’s team are some of the Biomedica seeks to retain demonstrated long term gene most highly skilled and focused 100 manufacturing rights for its expression data seen with its people in the cutting edge world New colleagues in 2019 out-licensed programmes, predecessor OXB-201, targeting of gene and cell therapy, working capturing further value angiostatin and endostatin for in office and laboratory facilities throughout their development which work has now been that are amongst the best. and commercialisation. This halted with VEGF-trap approach pipeline strategy is exemplified taken with OXB-203 seen as a by the Group’s 2018 land-mark better validate target for Local communities out-licensing agreement with wet-AMD. In addition, OXB- The Group has provided high Axovant for the Group’s 202, which targeted the same skilled jobs to the local community, 8 Parkinson’s disease candidate. genes as OXB-201 but for and have established an apprenticeship Apprenticeships created corneal graft rejection, will also scheme in collaboration with in 2019 Link to risks A C D E no longer be further advanced Advanced Therapies Apprenticeship due to moving away from the Community and the University angiostatin/endostatin of Kent. approach. In addition, the Group is continuing pre-clinical work on OXB-204 (LCA10) and OXB-103 (ALS) and a new Governing bodies and regulators pre-clinical program, OXB-401 The Group operates in a highly regulatory environment. With a long (liver indication), has been history of achievements, the Group’s technology is recognised by initiated. Work on OXB-208 regulators on both sides of the Atlantic. (RP1) has been de-prioritised and hence halted in favour of far more promising Read more about the Group’s stakeholders on pages 22 and 23. programmes. There were no cost implications that resulted from the decision to stop. Principal risks facing the business Link to risks A D E The main risks are:

A Risks associated with pharmaceutical product development including product safety issues, lack of efficacy, and failure to obtain regulatory approval. B Risks to our bioprocessing revenue from failure to manufacture lentiviral vector to the required standard.

C Exposur e to one or more of our partners ceasing to develop their products and thereby no longer requiring our services. D F ailure out-licence or spin-out the Group’s product development candidates so that development stops.

E Inability to attract and/or retain highly skilled employees.

The principle risks facing the Group, including how they are managed and mitigated, are set out in detail on pages 58 to 62.

Oxford Biomedica plc | Annual report and accounts 2019 22 Strategic report The Group’s stakeholders

The Group believes that, to maximise value and secure Stakeholders Key issues How the group engages 2019 highlights Further links long-term success, the Group must take account of 1 Employees what is important to key stakeholders. This is best The Group has an experienced, diverse and – Opportunities The Group has an open, collaborative and inclusive management – Stuart Henderson p. 96 People and achieved through proactive and effective engagement. dedicated workforce which it recognises as for development structure and engages regularly with employees. The Group does designated as the Employee. a key asset of the business. Therefore, it is and progression. this through site visits by Board members, an appraisal process, Non-Executive p. 49 Rewards. A stakeholder mapping exercise identified the Group’s important that the Group continues to create – Health, safety structured career conversations, management development Director to engage p. 49 Employee bonus. key stakeholders and channels for engagement. the right environment to encourage and create and wellbeing. programmes, employee surveys, webinars and webcasts, digital with the workforce p. 49 Diversity. opportunities for individuals and teams to realise – Opportunity to sharing platforms, company presentations, town hall meetings, advisory panel. p. 50 Employee their full potential. share ideas and email briefings and newsletters and its well-being programme. – Roll out of the communication. s172 Companies Act 2006 make a difference. Employee engagement is frequently measured and the Group has management – Diversity and designated Stuart Henderson, as the Non-Executive Director to development The Group sets out in the adjacent table the key stakeholder groups, inclusion. oversee employee engagement, including gathering the views programme. the material issues and how the Group engages with them. Each of the workforce. The Group is also in the process of establishing – Roll out of the stakeholder group requires a tailored engagement approach to foster a workforce advisory panel. Rewards programme. effective and mutually beneficial relationships. 2 Patients By understanding the Group’s stakeholders, the Group can factor The Group works on the development of – Patient safety. Via the Clinical Development Service department the Group – More than 200 p. 54 Clinical trials into Board meeting discussions the potential impact of decisions on innovative products either by itself or with – Well-designed consults with key clinical opinion leaders/physicians and regulatory patients treated with and ethics. partners in order to provide life changing clinical trials. experts in order to design safe clinical trials for patients. the Group’s lentiviral each stakeholder group and consider their needs and concerns, in treatments to patients. – Progressing vectors. accordance with s172 of the Companies Act 2006 (see page 68). The product Group works effectively with its employees, customers and suppliers, candidates to to make a positive contribution to local communities and achieve long- the market. term sustainable returns for the Group’s investors. Acting in a fair and 3 Customers responsible manner is a core element of the Group’s business practice The continued performance of the Group’s – Understand Via the Group’s client partner & alliance management – Added additional p. 29 2019 as seen in the Responsible business report on pages 48 to 54. business would not be possible without customers’ needs. department and also the business development team, the Group CART targets with Performance understanding the customers’ needs and future – Customer communicates regularly with its existing customers/partners Novartis. review. Key stakeholders aspirations. Many of the customers have come retention and to discuss their goals and incorporate them into the Group’s – Progressed p. 81 Executive annual to the Group as their businesses have moved expansion of schedules/strategy. The Group does this through meetings, joint programmes with the bonus. into the cell and gene therapy sector, which programmes. steering committees, engagement events and forums. This active Group’s partners as We have identified seven key stakeholders as follows: is testament to the Group’s expertise and – Identification of engagement ultimately ensures that the Group meets their needs per agreement. 1 Employees leadership in the sector. new customers. and assists them to achieve their business goals. 2 Patients 4 Local communities 3 Customers The Group is committed to supporting the – School and The Group engages with the local community not only through the – Eight apprenticeships p. 48 People. 4 Local communities communities in which the Group operates, careers events. planning process but also through the Group’s “Helping hands” forum, – Appointment of an p. 51 Charitable work. including local businesses, residents, schools – Local charity with volunteering, fundraising and charity work. The Group also early careers advisor p. 51 Community. 5 Suppliers and the wider public. involvement. attends schools and career fairs, and also provides apprenticeships and – £9,500 in fundraising p. 51 Apprenticeship 6 Regulators work experience opportunities. The Group also liaises with industry for local Oxford scheme. bodies and government organisations to enhance the positive impact charity. p. 51 Charitable giving. 7 Shareholders the Group has on the communities and sector in which it operates.

5 Suppliers The Group outsource some of its activities to – Long-term Through effective collaboration, the Group aims to build long-term – Establishment of p. 62 Brexit. third-party suppliers and providers. As a result, partnerships. relationships with its suppliers so that both parties benefit. The procurement and p. 54 Slavery and code it is crucial that the Group develops strong – Collaborative Group has regular supplier meetings and business reviews and supplier function to of conduct. working relationships with the Group’s suppliers, approach. has a supplier code of conduct. interact with suppliers so the Group can enhance the efficiency of the more effectively. business and create value.

6 Regulators The Group operates in a highly regulated – Meeting The Group has dialogue with government regulatory bodies on – Four audits by p. 59 Regulatory risk. environment and it is important that it engages regulatory a regular basis and attends industry forums. The Group also has government with the regulators as required. compliance. compliance audits performed by both government regulatory regulatory bodies. bodies and by its customers. – Two audits by customers.

7 Shareholders The Groups shareholders play an important role – Corporate Through the Group’s investor relations programme which – 200+ meetings p 70 Shareholder in monitoring and safeguarding the governance governance. includes regular updates, meetings, roadshows and the Group’s with the investor engagement of the Group. – Business ethics. Annual General Meeting (AGM) and the fact that representatives community. in 2019. – Strategy and of two major shareholders sit on the Board, the Group ensures – 30+ shareholders p. 79 Remuneration – business model shareholder views are brought into the Board discussions and attended the AGM. annual bonus – Financial considered in the Groups decision making. The Group also – New investor in Novo and LTIP. performance. engages with shareholders via the Annual Report and Accounts Holdings. and the Corporate website.

Oxford Biomedica plc | Annual report and accounts 2019 of theGroup. in monitoringandsafeguarding thegovernance The Groups shareholders playanimportantrole Shareholders with theregulators asrequired. environment anditisimportantthat itengages The Group operates inahighlyregulated Regulators business andcreate value. so theGroup canenhancetheefficiencyof the working relationships withtheGroup’s suppliers, it iscrucialthat theGroup developsstrong third-party suppliersandproviders. Asaresult, The Group outsource someof itsactivitiesto Suppliers and thewiderpublic. including localbusinesses,residents, schools communities inwhichtheGroup operates, The Group iscommittedtosupportingthe communitieLocal s leadership inthesector. is testamenttotheGroup’s expertiseand into thecellandgenetherapysector, which to theGroup astheirbusinesseshave moved aspirations. Manyof thecustomershave come understanding thecustomers’needsandfuture business wouldnotbepossiblewithout The continuedperformance of theGroup’s Customers treatments topatients. partners inorder toprovide life changing innovative products eitherbyitselforwith The Group works onthedevelopmentof Patients their fullpotential. opportunities for individualsandteamstorealise the rightenvironment toencourageandcreate important that theGroup continuestocreate a key assetof thebusiness.Therefore, itis dedicated workforce whichitrecognises as The Group hasanexperienced,diverseand Employees Stakeholders Oxford Biomedica plc|Annual report andaccounts2019 – – – Businessethics. – – – – – – – – Key issues – – – – – – – – Patient safety. performance. Financial business model S governance. Corporate compliance. regulatory Meeting approach. Collaborative partnerships. Long-term inclusion. make adifference. share ideasand and wellbeing. and progression. for development Opportunities involvement. Local charity careers events. School and new customers. Identifica programmes. expansion of retention and Customer customers’ needs. Understand the market. candidates to product Progressing clinical trials. Well-designed Diversity and Opportunity to Health, sa trategy and trategy and tion of tion of fety fety

and theCorporate website. engages withshareholders viatheAnnualReportandAccounts considered intheGroups decision making.TheGroup also shareholder viewsare brought intotheBoard discussionsand of twomajorshareholders sitontheBoard, theGroup ensures Annual GeneralMeeting(AGM) andthefactthat representatives includes regular updates, meetings,roadshows andtheGroup’s Through theGroup’s investorrelations programme which bodies andbyitscustomers. compliance auditsperformed bybothgovernmentregulatory a regular basisandattends industryforums. TheGroup alsohas The Group hasdialoguewithgovernmentregulatory bodieson has asuppliercodeof conduct. Group hasregular suppliermeetingsandbusinessreviews and relationships withitssupplierssothat bothpartiesbenefit.The Through effective collaboration, theGroup aimstobuildlong-term a workforce advisory panel. a workforce advisorypanel. of theworkforce. TheGroup isalsointheprocess of establishing oversee employeeengagement,includinggathering theviews designated Stuart Henderson,astheNon-Executive Director to Employee engagementisfrequently measured andtheGroup has email briefingsandnewslettersitswell-beingprogramme. sharing platforms, companypresentations, townhallmeetings, programmes, employeesurveys,webinarsandwebcasts,digital structured career conversations, managementdevelopment this through sitevisitsbyBoard members,anappraisalprocess, structure andengagesregularly withemployees.TheGroup does The Group hasanopen,collaborative andinclusivemanagement How thegroupengages the Group hasonthecommunitiesandsectorinwhichitoperates. bodies andgovernmentorganisations toenhancethepositiveimpact work experienceopportunities.TheGroup alsoliaiseswithindustry attends schoolsandcareer fairs,andalsoprovides apprenticeships and with volunteering,fundraisingandcharitywork.TheGroup also planning process butalsothrough theGroup’s “Helping hands”forum, The Group engageswiththelocalcommunitynotonlythrough the and assiststhemtoachievetheirbusinessgoals. engagement ultimately ensures that theGroup meetstheirneeds steering committees,engagementeventsandforums. Thisactive schedules/strategy. TheGroup doesthis through meetings,joint to discusstheirgoalsandincorporate themintotheGroup’s communicates regularly withitsexistingcustomers/partners department andalsothebusinessdevelopmentteam,Group Via theGroup’s clientpartner&alliancemanagement experts inorder todesignsafe clinicaltrialsfor patients. consults withkey clinicalopinionleaders/physiciansandregulatory Via theClinicalDevelopmentServicedepartmentGroup

– – – – – – – – 2019 highlights – – – Eightapprenticeships – – – – New investorinNovo 30+ shar 200+ meetings T Four auditsby Establishment o community. with theinvestor customers. Holdings. Holdings. attended theAGM. regulatory bodies. government more effectively. interact withsuppliers supplier functionto procurement and Rewards programme. Rewards programme. programme. development management Mor Roll outo Roll outo advisory panel. with theworkforce Director toengage Non-Executive designated asthe S £9 Appointment o Added additional charity. for localOxford early careers advisor per agreement. Group’s partnersas programmes withthe Progressed Novartis. CART targets with vectors. the Group’s lentiviral patients treated with wo audits by wo auditsby tuart Henderson tuart Henderson ,500 in fundraising ,500 infundraising e than 200 e than200 eholders eholders f the f the f the

f an f an

f f

p. 59 Regulatory risk. p. 59Regulatory risk. p. 79 p 70 p. 54 p. 62Brexit. p. 50 p. 49Diversity. p. 49Employeebonus. p. 49Rewards. p. 96 Further links p. 81 p. 51 p. 51 p. 51 p. 51 p. 48 p. 29 p. 54 Shar in 2019. engagement scheme. Appr Charitable giving. Community. Charitable work. bonus. bonus. Ex Remunera and LTIP. annual bonus Sla of conduct. Clinical trials and ethics. review. Performance 2019 communication. Employee Employee. People and People. ecutive annual ecutive annual very and code very andcode eholder eholder enticeship enticeship

tion – tion –

Strategic report 23 24 Operational highlightsdeliveredin2019 Strategic report Oxford Biomedica plc|Annual report andaccounts2019 — — — — Novartis partnership Post PeriodHighlights facilities Expansion ofbioprocessingandlaboratory — — — — — — — productdevelopment Proprietary — — New partnerships

ymriah

20 countriesinat leastoneindication. and relapsed andrefractory diffuselarge B-cell lymphomawith reimbursement approved in very recent timing of this issue being identified. very recent timingof thisissue beingidentified. party but is not yet in a position to verify or validate any information relating to this matter due to the give risetoamaterial claimagainst theGroup. TheGroup hasbeenincommunication withthethird development workperformed onbehalfof acustomerin 2018and2019whichpotentiallycould K Subsequent Continued str as royalties, as previously agreed. as royalties, aspreviously agreed. revenues in addition to undisclosed process development fees, with other financial terms, such The agreement includes a minimum of $75 million over five years in manufacturing batch extended thenumberof lentiviralvectorprogrammes inthecollaboration from twotofive. Novartis extendeditscommer during 2019withincreased utilisation expectedduring2020. UPRDS PartIII’OFF’Score at twelvemonthsoverthesixmonthdata wasreported. the firstcohort of theSUNRISE-PD studyontwopatients where acontinuedimprovement in manufacturing scaleupfor Oxford University andAstraZeneca. provide access to its large scale GMP manufacturing facilities including Oxbox to support the impact ontheGroup iscurrently uncertain,shouldclinicaltrialsbesuccessful theGroup will for theglobaldevelopment anddistributionof thevaccineon30thApril.Whilepotential ChAdOx1 nCoV-19. AstraZeneca subsequently entered into an agreement with Oxford University rapidly develop,scale-upandmanufacture apotentialvaccine candidate for COVID-19 called In ApriltheGr which nowtakes thetotalnumberof activevectorconstructstosix. In thefirstquartero process development,scaleupandbatch revenues andanundisclosedroyalty onsales. up to$217millionindevelopment,regulatory andsalesrelated milestonesinaddition toundisclosed Myers Squibb for initially four CAR-T and TCR-T programmes. $10 million upfront payment and Signed newlicenceandfive-yearclinicalsupplyagr Occupa first half of 2020. building phasecompleted,validation ongoingandfirstcommercial batches anticipated inthe Development o The Gr triggered £11.5million($15million)milestonepaymentfrom partnerAxovant. First pa Computing toimprove process efficiencyand reducecosts. Collabora for developmentof genetherapyvectorstargeting aninheritedretinal disease. Collabora CAR-T therapy. oup’s partner, Axovant, announcedtwelvemonthfollow-up data inJanuary2020from tient dosinginsecondcohortof SUNRISE-PD phaseIIstudyinParkinson’sdisease ® tion of new 32,000 sqft (2,970 sqm) Windrush Innovation Centre (WIC) commenced roll out accelerating inrelapsed andrefractory B-cell acutelymphoblasticleukaemia tion established with Microsoft Research to leverage machine learning and Cloud tion establishedwithMicrosoft Research toleveragemachinelearningandCloud tion, optionandlicenceagreement establishedwithSantenPharmaceuticalCoLtd to year end the Group identified an issue regarding an aspect of certain process ong performance assoleglobalsupplierof lentiviralvector for Kymriah oup hasjoinedaConsortiumledbytheJennerInstitute, Oxford University, to f majornew84,000 sqft(7,800 sqm)bioprocessing facilityontarget withinitial f 2020 the Group started work on an additional vector construct for Novartis f 2020theGroup startedworkonanadditionalvectorconstruct for Novartis cial supply agreement by a further five years in December and cial supplyagreement byafurtherfiveyearsinDecemberand eement with Juno Therapeutics / Bristol eement withJunoTherapeutics/Bristol ®

See page28. See page31. See page29. See page18. See page32. See page31. See page30. See page29. See page28. (2018: £13.4 millionprofit). Operating EBITDA lossincurred of £5.2 million 2. Oxford Biomedica plc|Annual report andaccounts2019 ting EBITDA (EarningsBefore Interest, Tax, Depreciation, Amortisation, revaluation of investmentsandassetsheldfor sale, 1. facility withOaktree CapitalManagement. Successful £43.6 millionrepayment of ourloan Loan facilityrepaymentinJune2019 £43.6m (2018: £13.9 millionprofit). Operating lossincurred of £14.5 million Operating loss £14.5m Operating EBITDA £5.2m £26.6 millionto£41.9 million. Operating expensesincreased by57%from Operating expenses +57 (2018: £40.5 milllion). revenues increased by17%to£47.3 million Biopr development revenue Bioprocessing &Commercial +17% joining theshare register. Capital ManagementwithNovoHoldings primarily torepay theloanfacilitywithOaktree Successful £53.5 millionequityplacingused Equity placinginMay2019 £53.5m Financial highlightsdeliveredin2019 Strategic report

or lossallnon-cashitems,includingthecharge for share options.Areconciliation toGAAPmeasures isprovided onpage42. and Share BasedPayments)isanon-GAAP measure often usedasasurrogate for operational cashflowasitexcludes from operating profit A reconciliation toGAAPmeasures isprovided onpage 42. Opera Opera ocessing and commercial development ocessing andcommercial development ting expensesare madeupoutof Bioprocessing expenses,research anddevelopmentexpensesadministrative expenses.

% 1 loss loss 2

(2018: £2.8 millioninflow). increased by£25.7 millionto£22.9 million Cash outflowbefore financingactivities Cash outflow £22.9m (31 December2018:£32.2million). Cash of £16.2 million Cash £16.2m (2018: £10.1 million). Capital expenditure £25.8 million Capital expenditure £25.8m decreased to£16.8 million(2018:£26.3 million). Licences, milestones&royalties revenues Licences, milestones&royalties revenue £16.8m to £64.1 million. Revenue decreased by4%from £66.8 million Revenue £64.1m available for sale asset. available for saleasset. in fairvalueof Orchard Therapeutics £1.9 millionloss(2018:£6.0 milliongain) Change infairvalue £1.9m

–20 –30 –25 –10 –20 –15 –10 –15 –5 –5 10 15 0 5 0 5 £m Cash outflowbeforefinancingactivities £m Operating EBITDA 0421 2016 2015 2014 0421 062017 2016 2015 2014 2017 082019 2018 082019 2018

Strategic report 25 26 and predictable income. and predictable income. Group anticipates asmoothergrowth trajectorywithincreasingly robust building itslong-term,sustainablefuture. Asitreaches optimalscale,the in-house pipeline. By investing across its business, Oxford Biomedica is its Statement of financialpositiontosupportitsLentiVector from theNovoHoldingsinvestmenttofullyrepay debtandfurtherboost strengthened ourabilitytoaccelerate this.TheGroup usedtheproceeds investment from leadinglife sciencesinvestorNovoHoldingshasfurther The Group’s investmentstrategy ismakinggoodprogress, andastrategic production capacityandexpertpeoplebuildingtheGroup’s criticalmass. ongoing investment in platform innovation, developmentcapabilities, this opportunitytoleadintheindustrialisation of lentiviralvectors,through move towards commercialisation. Oxford Biomedicaistakingadvantageof The geneandcelltherapysectorismaturing rapidly, asevermore products Investing ininnovation major upsidepotential. wholly-owned pipeline of earlier-stage product candidates, which offer bioprocessing andprocess developmentbusinessiscomplementedbyits with amore traditionalbiotechnologybusiness.TheGroup’s underlying cell therapysector, withoutthemajorfinancialandclinicalrisks associated Biomedica cancapture significantvaluefrom therapidlygrowing geneand By spearheadingtheindustrialisation of thelentiviralvector, Oxford model offering theprospect of long-termsustainablegrowth. commercialisation process. Thisprovides auniquelydiversifiedbusiness expertise andinfrastructure that spanstheentire product developmentand world leadinglentiviralvectorcompany. TheGroup bringstogetherinnovation, a As apioneerinitsfield,Oxford Biomedicahasbuiltanenviablepositionas Building ageneandcelltherapyleader patients asafullyintegratedgenetherapycompany. ideally placed to deliver value by pursuing its mission of curing programme. With thesestrong foundations in place, the Group is and extendedpartnershipsdeliveredonitscapacityexpansion bioprocessing andprocessdevelopmentbusiness,establishednew The Groupachievedstrongrevenuegrowthinitsunderlying Chairman’s statement Strategic report Oxford Biomedica plc|Annual report andaccounts2019 ® platform and platform and “ its position as a world leading its positionasaworldleading continued toconsolidate good progress in2019, asit Oxford Biomedicamade I ampleasedtor Chairman Dr. LorenzoTallarigo gene andcelltherapybusiness.”

eport that eport that

Oxford Biomedica plc|Annual report andaccounts2019 Chairman Dr. LorenzoTallarigo cell therapyindustry. as itcontinuestomeetthegrowing demandsof theburgeoning geneand Biomedica looks forward toprogressing eachof itsoperating segments a large numberof itstargets in2019, andduringthecomingyear Oxford capture valueandbuildaworld-leadingbusiness.TheGroup hasdelivered Biomedica isideallypositionedtocontributethesector’ssuccess, pace. With its unique capabilities and diversified businessmodel Oxford The growth of the gene and cell therapy field continues at an exciting Positive outlook Oxford Biomedicatobuildtheworld-leadingposition itholdstoday. their fantastic dedication and hard work during the year, which has enabled would like towelcomeournewcolleagues,andthank allouremployeesfor Group completes a search for my replacement. On behalf of the Board, I retire from Oxford Biomedica'sboard. IwillcontinueasChairmanwhile the served four yearsasChairman,Ihave informed theGroup of myintentionto appointment of additionalNon-Executive Directors. Inaddition,having rapid paceandislookingtostrengthen theBoard furtherwiththe Head of NovoGrowth at NovoHoldings.TheGroup continues to grow at a Executive Board Director, RobertGhenchev, whojoinstheCompanyas a broadened Senior Executive Team, and the addition of a further Non- of production, analytical and research expertise. They are complemented by the year the Group welcomed over 100 new colleagues who bring a range supported bysignificantgrowth intheOxford Biomedicateam,andduring continued deliveryacross itspartnerships.Thisongoingprogress was completion of thefirstphase of itsnewOxbox manufacturingfacilitiesand Throughout 2019, theGroup continueditstransformation, withthe Investing intheteam critical mass. capacity andexpertpeoplebuildingtheGroup’s innovation, developmentcapabilities,production vectors, through ongoinginvestmentinplatform opportunity toleadintheindustrialisa and celltherapysectormaturing rapidly, seizing r who bringarangeof production, analyticaland The Group welcomedover100newcolleagues Adding toourteams +100 people Oxf of lentiviralvectors A worldleaderintheindustrialisation esearch expertise. esearch expertise. ord Biomedica is taking advantage of the gene ord Biomedicaistakingadvantageof thegene tion of lentiviral tion of lentiviral

Strategic report 27 28 in theUSandEurope. territories, andwasthefirst lentiviralvectorbasedtherapytobeapproved receive regulatory approval intwodistinctB-cell malignancies inthese portfolio. Kymriah machine learningtofurtherenhanceitsLentiVector and itsnewlyestablishedcollaboration withMicrosoft isapplyinginnovative the Group’s industrial-scalebioprocessing facilitiescontinuedontrack, supply agreement for Novartis’CAR-T portfolio. Inparallel,expansionof platform andboosteditsmanufacturingbusinesswiththeextensionof the least oneindication. Kymriah and anumberof countriesinEurope, have approved reimbursement inat to grow. Currently, 20countries,includingtheUS, Canada,Japan,Australia global roll out,andbothproduct approvals andreimbursement continue large B-cell lymphoma(r/rDLBCL).During 2019itcontinueditsrapid acute lymphoblasticleukaemia (r/rALL)andrelapsed andrefractory diffuse T cellstotarget cancer. Itisindicated in relapsed andrefractory B-cell Kymriah with Novartisfor thecommercial andclinicalsupplyof lentiviralvectorsfor Throughout 2019, theGroup continuedtodeliverunderitspartnership Novartis partnershipprogress maximizing theopportunityinfastgrowing cellandgenetherapymarket. smoothing its revenue trajectory as it builds an exciting long-term business growth, theGroup anticipates furtherincrease inmanufacturingrevenues from NovoHoldings.AsOxford Biomedicacontinuesitsstrong underlying strengthened itsStatement of financialpositionwithamajorinvestment this wasoffset to someextent bylower licensingincome,the Group and process commercial developmentrevenues increasing by17%.While underlying businessenjoyedcontinuedstrong growth, withitsbioprocessing growing maturity as a leading gene and cell therapy business. The Group’s Oxford Biomedica’sfinancialperformance demonstrates theGroup’s in 2018. ItcontinuedtodevelopitsLentiVector the clinical development of AXO-Lenti-PD following its out-licensing list of partners,andadvanceditspipelineof proprietary products, supporting increased itsportfolio of collaborations, withtheadditionof Santentoits consolidating itspositionasaworldleadinglentiviralvectorcompany. It Oxford Biomedicacontinuedtomake strong progress in2019, world-leading LentiVector our power of artificial intelligence to further boost the efficiency of innovation. OurnewcollaborationwithMicrosoftisharnessingthe continues itsrapidgrowth,andweremainattheforefrontof facilities expansionontarget.Thecellandgenetherapysector establishing anewpartnershipwithSantenanddeliveringour commercial supplyagreementwithNovartisforanotherfiveyears, Oxford Biomedicamadegoodprogressduring2019, extendingour 2019 performancereview Chief Executive Officer’sand Strategic report Oxford Biomedica plc|Annual report andaccounts2019 potential ofourworld-leadingtechnology. financial positionplacesusinastrongertorealisethe investment byNovoHoldingsin2019, oursimplifiedStatementof We arebuildinganexciting business,andwiththesignificant industrialisation oflentiviralvectordevelopmentandmanufacture. ® (tisagenlecleucel, formerly CTL019) and Novartis’ broader CAR-T ® isaground-breaking CAR-T therapythat usespatients’ ® ® remains thefirstandonlyCAR-T therapyto delivery platform, as we continue the platform,aswecontinuethe delivery

® cell and gene delivery cellandgenedelivery ® platform. platform.

“ Chief Executive Officer John Dawson forefront of innovation growth, andweremain at the sector continuesitsrapid The cellandgenetherapy

.”

production expertise and world-leading industrialisation capabilities. production expertiseandworld-leadingindustrialisation capabilities. and commercialisation intheUnitedStates andEurope. Biomedica retains anoptiontopartnerandco-fundproduct development single-digit royalties onproduct sales. Undertheagreement, Oxford undisclosed milestone,inadditiontofuture developmentmilestonesand platform and industrial-scale production capabilities, Santenwill pay an sole globalsupplierof lentiviralvectorfor Kymriah sales asagreed intheinitial2014 collaboration. TheGroup remains the process development andfacilityreservation fees androyalties onproduct minimum of manufacturingrevenues overthefiveyears,inadditionto terms of theagreement, Oxford Biomedicawillreceive $75million Oxford Biomedica plc|Annual report andaccounts2019 five lentiviralvectors for CAR-T products, including Kymriah extension of thesupplyagreement for anadditionalfiveyears,covering In December, the success of the Novartis partnership culminated in the Oxford Biomedica. commercialisation, whileretaining significant economicinterest for house priortoattracting partner fundingfor clinical development and strategy, withproduct innovation andinitialdevelopmentconducted in- This landmark agreement validated the Group’s proprietary portfolio for Parkinson’sdisease,OXB-102 (subsequentlyrenamed AXO-Lenti-PD). rights to Oxford Biomedica’s internally developed gene therapy candidate Therapies) for theexclusive worldwidedevelopmentandcommercialisation $842.5 millionagreement withAxovant Sciences(now Axovant Gene In 2018, theGroup signedanagreement estimated tobeworthup Axovant GeneTherapieslicensing agreement productdevelopment: Proprietary developing anovelinhaledgenetherapyfor cysticfibrosis. Therapy Consortium,BoehringerIngelheimandImperial Innovations programme, as well as a collaboration with the UK Cystic Fibrosis Gene immunodeficiency (ADA-SCID), MPS-IIIA andathird undisclosed therapeutics inthetreatment of adenosinedeaminasesevere combined lentiviral vectorstargeting thetreatment of haemophilia,Orchard Sanofi (formally Bioverativ) for thedevelopmentand manufacture of The portfolio includestheGroup’s $105millionstrategic partnershipwith LentiVector collaborations. Theseprovide partnerswithaccesstoitsinnovative During theyear, theGroup continuedtoprogress itsportfolio of existing Other existingpartnerprogrammes disease. Onexercise of theoptiontoaccessGroup’s LentiVector novel genetherapyproducts targeting thetreatment of aninheritedretinal Oxford Biomedicawilldevelopandmanufacture lentiviral vectorsfor Under thetermsof theR&Dcollaboration, optionandlicenceagreement, and has a global presence in over 60 countries. and hasaglobalpresence inover60countries. is themarket leaderfor ophthalmicprescription pharmaceuticalsinJapan national ophthalmologycompanySantenPharmaceuticalCoLtd. Santen In June2019, theGroup establishedanewpartnershipwith leadingmulti- Santen partnership site tothepartnership. dedicated manufacturingfacilityat itsnewOxbox commercial production ® gene and cell therapy delivery platform, development and geneandcelltherapydeliveryplatform, developmentand

® and will allocate a andwillallocate a ® . Under the . Underthe ®

vectors for Kymriah for thecommercial andclinicalsupplyof lentiviral to deliverunderitspartnershipwithNovartis Throughout 2019, theGroup continued Lentiviral vectorsforKymriah a £11.5million($15million)milestonepayment. of Axovant’s phaseIIstudyof AXO-Lenti-PD triggered Dosing of thefirstpatient inthesecondcohort Axovant collaborationandlicenceagreement US$15m with Novartisfor anotherfiveyears. We extendedourcommercial supplyagreement Novartis partnership +5 years ® . ®

Strategic report 29 30 innovation, enhancedoperational efficiencyandexpandedcapacity. to maintainLentiVector proprietary pipeline.Oxford Biomedica’s investment strategy is designed centric platform isthefoundation of theGroup’s collaborations and the industrialisation of the lentiviral vector. This world-leading, innovation- of expertise,intellectualproperty andworld-classfacilities,allfocused on Oxford Biomedica’s LentiVector LentiVector platformdevelopment has beeninitiated. OXB-103 (ALS)andanewpre-clinical program, OXB-401 (liverindication), the Group iscontinuingpre-clinical workonOXB-204 (LCA10) and predecessor OXB-201, for whichworkhasnowbeenhalted.Inaddition, builds onthedemonstrated longtermgeneexpression data seenwithits technology todeliverageneexpress afibercept. Thisprogramme pre-clinical studies,istargeting Wet AMDandusesOxford Biomedica’s programme movestowards entryintotheclinic.OXB-203, currently in CAR-T 5T4. Advancedpre-clinical workiscontinuingonOXB-302 asthe the Group’s prioritycandidate andtargets haematological tumourswitha into earlystageclinicalstudiesinthecoming12-18months.OXB-302 is where pre-clinical investmentwillbemade,topotentiallytake through Following aninternalpipelinereview prioritieshave nowbeensetfor oncology, liverandCNSdisorders. patient-centric products targeting anumberof indications inophthalmology, its pipelineproduct candidates. Thecurrent portfolio consistsof five engaged inpartneringdiscussionstoout-licenseorspin-outanumberof In linewiththeGroup’s proprietary portfolio strategy, Oxford Biomedicais in-houseproductdevelopment Proprietary by theendof theyear. expects tobegintherandomised,sham-controlled portionof thestudy and developmentof asuspension-basedmanufacturingprocess, Axovant quarter of 2020. Based on theoutcome of thedose-escalation phase, month data from thefirst six patients incohort one and twoby the fourth second dosecohortcontinuesandAxovant anticipates announcingsix improvement of 29%at sixmonthsonthesamescale.Enrolment intothe baseline asassessedbytheUPDRSPartIII‘OFF’ score. Thisfollowed an favourable safety profile and a 37% improvement in motor function from January 2020, 12-monthdata from thisgroup demonstrated acontinued events related tothetreatment, whichwasgenerallywelltolerated. In continued toimprove across multiplemetricswithnoseriousadverse In June2019, six-month data from thefirstdosecohortshowedpatients ($15 million)milestonepaymenttoOxford Biomedica. SUNRISE-PD phaseIIstudyof AXO-Lenti-PD triggered a£11.5million In April2019, dosingof thefirstpatient inthesecondcohort of the 2019 performancereview Chief Executive Officer’sand Strategic report Oxford Biomedica plc|Annual report andaccounts2019 ®

® platform’s leading position through constant platform’s leadingposition through constant ® platform is a unique combination platform is aunique combination

partners withaccesstoitsinnovative LentiVector portfolio of existingcollaborations. Theseprovide During theyear, theGroup continuedtoprogress its Progress ourportfolioofexistingcollaborations industrialisation capabilities. and production expertiseandworld-leading gene andcelltherapydeliveryplatform, development ®

Capacity expansion enabling fasterscreening andanalyticaltesting. automation androbotics isstreamlining production, reducing costsand cost-effective manufacturing.Ongoinginvestmentinhigh-throughput increased utilisation expectedduring2020. pipeline. Occupation of thefacilitybeganduringfirsthalf of 2019 with Oxford Biomedica plc|Annual report andaccounts2019 and commercialisation. the Group hasbuiltaglobalhub for lentiviralvector development (21,000 sqm). With its five specialist facilities centred around Oxford, than doubled itsfootprint, which now extendsto over 226,000 sqft With theadditionof thesetwonewfacilities,Oxford Biomedicahasmore teams todriveLentiVector together research, automation, process developmentandbioprocessing a new32,000 sqft(2,970 sqm)discovery andinnovation hub.Thisbrings Group isintheprocess of establishingtheWindrushInnovation Centre (WIC), Alongside theexpansionof Oxford Biomedica’smanufacturingcapacity, the a dedicated amanufacturingsuitefor NovartiswithinOxbox. end of theyear. AsannouncedinDecember, Oxford Biomedicawillhave the fill/finishsuitesis progressing well,withhandoverexpectedbythe batches bytheend of thesecond half of 2020. In parallel, development of achieving regulatory approval and manufacture of the first commercial planned. Validation iscurrently ongoing,andtheGroup anticipates production suites’buildingphasecompletedbytheendof theyearas During 2019, facilitydevelopmentmadegoodprogress, withthe fallow area tobedevelopedinfuture at theappropriate time fill/finish suites, offices, warehousingandQClaboratories, withthe remaining 45,000 sqft (4,200 sqm) in thenew facility with four GMP clean rooms, two GMP production suites.Thedevelopmentphasefitsoutapproximately Oxbox, complementsOxford Biomedica’sthree existingstate-of-the-art demand for lentiviralvectors.Thenew84,000 sqft(7,800 sqm)facility, additional facilityinOxford at theendof 2018tomeetthe anticipated higher As thecellandgenetherapyfieldcontinuestoexpand,Group leasedan LentiStable manufacturingsystemtodramatically improve vectoryields,andits (TRiP) has developeditsproprietary Transgene Repression in vector Production refining and enhancing its technology. In recent years, Oxford Biomedica The Group’s continuousimprovement programme focuses ondeveloping, yield andpurity, providing quicker, cheaperandmore reliable manufacture. algorithms andlaboratory automation theproject aimstoimprove vector analysis andmanufacture. Bycombiningcomputational modelling,novel computing tothelarge datasets generated duringprocess development, consistency. Thecollaboration willapplymachinelearningandcloud and industrial-scaleproduction byimproving process efficiencyand the powerof artificialintelligencetoenhancevectordevelopment establishing acollaboration withMicrosoft Research. Thisaimstoharness During 2019, Oxford Biomedicaextendeditsprogramme of innovation, Innovation ™ packaging and producer cell lines to enable scalable, packaging andproducer celllinestoenablescalable, ® platform innovation and progress the proprietary platform innovation andprogress theproprietary

in Japanwithaglobalpresence inover60countries. for ophthalmicprescription pharmaceuticals Santen PharmaceuticalCoL with leadingmulti-national ophthalmologycompany In 2019theGroup establishedanewpartnership Santen partnership >60 countries improving process efficiencyandconsistency. development andindustrial-scaleproduction by power of artificialintelligencetoenhancevector with Microsoft Research. Thisaimstoharnessthe programme of innovation, establishingacollaboration During 2019, Oxford Biomedica extendedits Collaboration withMicrosoftResearch td, is the market leader td, isthemarket leader

Strategic report 31 32 monitor theongoingsituation. if thesituation continuesorworsens. Managementcontinuestoconstantly there maybeanimpactonrevenue, supply chain andoperating facilities While theGroup isyettoexperienceanysignificantimpactfrom thevirus, — — — — The Group takes comfort from: GOV.UK guidanceandtodirect theGroup’s phasedresponse. management workinggroup tomonitorcurrent COVID-19 developments, operational risks tothebusinessandhasimplementedadailysenior The Group has conducted an assessmentof the potentialfinancial and Assessment ofCOVID-19 Potentialimpact growth inthebioprocessing, analyticsandplatform research teams. at the endof theyear, compared with432at theendof 2018, withsignificant programme. Headcountincreased asplannedwiththetotalreaching 554 across thebusinessasGroup continueditsfacilitiesexpansion General CounselandChiefMedicalOfficer. This growth wasmirrored was strengthened withtheadditionof twonewly-created positions: reflecting therapidexpansion of thebusiness.TheSeniorExecutive Team During theyear, thewiderOxford Biomedicateamalsocontinuedtogrow, proceeds initsLentiVector Statement of financialposition.TheGroup investedthebalance of the Management, thereby simplifyingandstrengthening theGroup’s repay the £43.6 milliondebtfacilityprovided previously byOaktree Capital the newly-enlarged share capital.Oxford Biomedicautilised thefundsto ordinary shares issued at theprevailing market rate, representing 10.1% of Novo Holdingsinvested£53.5 millionintheGroup inreturn for new leading life sciencesinvestorNovoHoldings.At theendof May2019, In the first half of 2019, Oxford Biomedica received major support from Investment progress 2019 performancereview Chief Executive Officer’sand Strategic report Oxford Biomedica plc|Annual report andaccounts2019 experience to Oxford Biomedica. experience toOxford Biomedica. Growth at Novo Holdingsandbringsawealthof corporate finance Group welcomedRobertGhenchevtotheBoard. RobertisHeadof Novo its subscriptionagreement. Followingtheissuanceof thenewshares, the granted the right to appoint a Non-Executive Director under the terms of working with innovative life sciences companies, Novo Holdings was As ahighly-regarded long-terminvestorwithasuccessfultrackrecord of Organisational progress

services toourcustomersthroughout thelockdown period. The Gr has hadpreviously. The Gr contracts withfinanciallysoundand resilient companies. Revenues to normalwayaspossible. employees seemtobeeffective, withworkcontinuingoninanasnear The dayto oup haskey worker status whichallowsusto continueproviding oup has a stronger and more diversified customer base than it oup hasastronger andmore diversifiedcustomerbasethanit day changes in working practices put in place to protect our day changesinworkingpracticesputplacetoprotect our and their subsequent receipts are based on long term and their subsequent receipts are based on long term ® platform andin-housepipelineprogrammes.

vector developmentandcommer Oxford, theGroup hasbuiltaglobalhubfor lentiviral With itsfivespecialistfacilitiescentred around Building aglobalhub 1 cialisation.

Oxford Biomedica plc|Annual report andaccounts2019 Chief Executive Officer John Dawson and ismakingencouragingprogress towards thisgoal. COVID-19 pandemic, the Group looks forward to another successful year major benefits for patients, partnersandshareholders alike. Despitethe intends todrivetowards long-termstableprofitability whilstdelivering predictable butpotentiallysignificantlicensingincome,Oxford Biomedica its otherpartnershipsvalidating theLentiVector With theongoingsuccessof itsNovartiscollaboration andprogress across innovation that underpinsitsworld-leadingLentiVector laboratory capacity, trainingitsnewly-enlarged teamandmaintainingthe strategy, bringingitsOxbox manufacturingfacilityonline,increasing its During 2020, Oxford Biomedica intends to continue its investment partner programmes enteringdevelopment. partnerships duringtheyear, aswellexpandingthenumberof existing gene andcelltherapysector. TheGroup anticipates addingfurther Group will have significantadditionalcapacitytoservetherapidlygrowing its newOxbox manufacturingfacilitycomingonstream during2020, the partnerships, includingitsextendedsupplyagreement withNovartis.With revenue growth from its portfolio of bioprocessing anddevelopment made across its business in 2019. The Group anticipates continued strong In thecomingyear, Oxford Biomedicaplanstobuildontheprogress Outlook and gr it intendstoprogress eachsegmentof itsbusiness.Byleveragingstrong built anindustryleadingposition.Asitcontinuestoinvestinitsfuture, demonstrates the potential to create significant shareholder value. demonstrates thepotentialtocreate significantshareholder value. bioprocessing agreements, the2018$842.5millionAxovant collaboration these transactionsislesspredictable thanongoingdeliveryunder development of itsin-houseproprietary products. Whilethetimingof The Group alsoplanstoattract third-party fundingtoprogress theclinical expenses duetotheenlarged teamworkingontheGroup’s partnerships. somewhat lowercapexexpenditure in2020, withhigheroperating sqft (4,200 sqm)buildingfullycompletedin2019, theGroup anticipates proprietary portfolio. WiththeOxbox constructionphaseof the 45,000 owing bioprocessing and development business to smooth less owing bioprocessing anddevelopmentbusinesstosmoothless ® platform, the Group has platform, theGroup has ® platform and platform and

validating theLentiVector and progress across ourotherpartnershipsis Validating theLentiVector proprietary products. progress theclinicaldevelopmentof itsin-house The Group planstoattract third-party fundingto Progressing ourin-houseproductpipeline The ongoing success of our Novartis collaboration The ongoingsuccessof ourNovartiscollaboration ® platform. ® Platform

Strategic report 33 34 Management team Strategic report Oxford Biomedica plc|Annual report andaccounts2019 Laboratories (UK) Limited. Laboratories (UK)Limited. Administra Director of Financeand Cephalon hewas Prior tothistimeat Zeneus byCephalon. million acquisitionof 2005 ledtheUS$360 million USdollarsandin turnover of several hundred 1,000 people,andtoa European businesstoover many dealsbuildingthe While at Cephalonheled Development Eur and Headof Business Chief FinancialOfficer of CephalonInc.,including the European operations management positionsin Previously, heheldsenior Officer inOctober2008. appointed ChiefExecutive in August2008andhewas as Non-Executive Director Oxford Biomedica’sBoard John Dawsonjoined Chief Executive Officer John Dawson can befound onpages64to65. Full biographiesfor theBoard of Directors tion of Serono tion of Serono

ope. ope.

in EnglandandW of Chartered Accountants member o De LaRueplc.Heisa business partneringat he washeadof finance joining Oxford Biomedica of internalaudit.Priorto becoming theglobalhead finance role before moved toacorporate outside of theUS. Hethen partnering for allbusiness Dir he becametheSenior Pharmaceuticals wher then movedtoShire Finance Dir to becomingtheEuropean sciences divisionsprior the healthcar in avarietyof roles within joined Steris, andworked EDS. Hesubsequently Watts before movingto accountant withHaines qualified asachartered healthcare sectors.He in thepharmaceuticaland He has16years’experience the Board inAugust2017. Oxford Biomedicaand Stuart Paynterjoined Chief FinancialOfficer Stuart Paynter ector of finance business ector of financebusiness f the Institute f theInstitute ector. He e and life e andlife

ales.

e e

Business Schoolin2002. distinction from London awarded anMBAwith London. Jasonwasalso from ImperialCollege complex diseasegenetics completed aPhDin Oxford Universityandalso from MagdalenCollege, BA (Hons)inBiochemistry He wasawarded a1stclass company 1997-2000. and firstworked at the at Oxford Biomedica post-doctoral scientist started hiscareer asa in AustriaandUK.Jason capital backed company ProtAffin AG,aventure co-founder andCEO of and Intercell AG andwas roles at SoseiCo.,Ltd. business development worked ininternational gene therapy. Hehas in biologics,vaccinesand biotechnology industry biotechnology industry experience inthe 2019. Hehas20years’ Business OfficerinMay promoted toChief Development andwas as Headof Business Biomedica in2015 Jason joinedOxford Chief BusinessOfficer Jason Slingsby

conducted post-doctoral Leeds andsubsequently from theUniversityof PhD inMolecularBiology of Sciencedegree anda field. HeholdsaBachelor on severalpatents inthe He isalsoanamedinventor and alliancemanagement. as wellclientprogrammes bioprocessing development, and lentiviralbased systems, analyticaltesting Oxford Biomedica’sQuality overall r In hiscurrent role, hehas practice) environment. been intheGxP(good therapy, 14 of whichhave experience ingeneandcell has more than18years’ Biomedica in2000. He Dr MiskinjoinedOxford Chief Technical Officer James Miskin Partnership (MMIP). Manufacturing Industry section of TheMedicines the AdvancedTherapies Advisory Committeeand Associa of theUKBioIndustry years. Heisamember Institute for anumberof research at ThePirbright tion Manufacturing tion Manufacturing esponsibility for esponsibility for

candidates andLentiVector Biomedica’s newproduct the developmentof Oxford role, heisresponsible for key papers.Inhiscurrent an authorof anumberof lentiviral vectorpatents and inventor onnumerous expert inthefield,anamed recognised world-class and analytics.Heisa technologies, bioprocessing delivery platform of geneandcelltherapies, including thedevelopment technical disciplines, covering arangeof lentiviral vectorexperience He hasover20yearsof Oxford Biomedicain1997. Dr Mitrophanous joined Chief ScientificOfficer Kyriacos Mitrophanous Association Board. o He isaCorporate Member University of Oxford. doctoral research at the and hasconductedpost- University CollegeLondon Molecular Biologyfrom platform. HeholdsaPhDin f the UK BioIndustry f theUKBioIndustry

Oxford Biomedica plc|Annual report andaccounts2019 The OpenUniversity. also hasanMBAfrom Chartered Chemistand originally qualifiedasa as inGlobalroles. He in ChinaandIndiaaswell spent severalyearsworking During hiscareer hehas contract manufacturing. innovative, generic and organisations encompassing manufacturing invarious Radiopharmaceutical dose,and Sterile, include API, Solidoral years of industryexperience within Novartis.His40+ Head of Anti-infectives most recently asPlatform pharmaceutical industry, positions inthe operational leadership a numberof senior Prior tojoininghehasheld Biomedica inApril2019. Nick joinedOxford Chief OperationsOfficer Nick Page

Warwick BusinessSchool. as wellanMBAfrom obstetrics andgynaecology and specialisation in medical doctor’sdegree Intelligence. Heholdsa Development Strategy and recently asaHeadof GmbH inGermany, most working withGrunenthal Dmitry spent2years joining Oxford Biomedica, metabolic diseases.Before in cardiovascular and wher and later toDaiichiSankyo to OnoPharmaceutical car He startedhispharmaceutical biotechnology industry. the pharmaceuticaland clinical developmentwithin 15+ yearsof experiencein consultant. Hebrings the companyasa worked for 10monthswith T of theSeniorExecutive as apermanentmember Biomedica inJuly2019 Dmitry joinedOxford Chief MedicalOfficer Zamoryakhin Dmitry eam having previously eam having previously eer at GSK, then moving eer at GSK,thenmoving e he spent over 7 years e hespentover7years

and Development. Institute o a memberof theChartered University intheUKandis degree from Northumbria sites. SheholdsaBA(Hons) across Vernalis’ UKandUS Vernalis plc,leadingHR Resources Director for she wasGroup Human joining Oxford Biomedica, AstraZeneca. Priorto Global HRDirector within followed byaperiodas MedImmune’s sitethere, UK toheadupHRfor she movedtoCambridge acquisition of MedImmune, Following AstraZeneca’s Partnering roles inGSK. in variousHRBusiness including anumberof years Biopharmaceutical sector, Resources roles withinthe experience inseniorHuman She brings20years’ Biomedica inApril2018. Helen joinedOxford Chief PeopleOfficer Helen Stephenson-Ellis f Personnel f Personnel

Covington &Burlington. most recently aPartnerwith Markets division.Shewas for theEquityCapital Director andLegalCounsel Lehman Br as wellworkingat of UKandUSlawfirms, has worked for anumber executive director. Natalie Holdings plcasanon- board of C4XDiscovery Natalie alsositsonthe and corporate governance. mergers andacquisitions capital markets transactions, transactional issues,equity a rangeof businessand Oxford Biomedica,on companies, including lawyer advisinglife sciences experience asacorpora She hasover20years’ as GeneralCounsel. Biomedica inMay2019 Natalie joinedOxford General Counsel Natalie Walter others as a others asa

te te

Strategic report 35 36 Delivery of2019objectives Delivery Strategic report Oxford Biomedica plc|Annual report andaccounts2019 2019 objectives C B A 4 2 3 5 1 Not met Part met Met with refinancing/clear theloanonmore favourable terms. manufacturing dealsandaproduct outlicensingdeal,along challenge. Assumptionsinthebudgetincludednew control of costs,thesewere goingtobeasignificant Set intheregime of aggressively growing saleswithstrict revenue andEBITDA targets whichwere drivenbythebudget. The financialobjectivessetout for 2019were toachieve Financial the Group, moveforward inclinicaldevelopment. AXO-Lenti-PD, whichhasbeenseentobringgreat valueto ahead of thecompetition.Valuable pipelineproducts suchas the platform. Thesegoalsare essentialtokeep theGroup patentable inventions)alongwithdata driveninnovations in into theGroup’s portfolio, alongsidetechnical(twonew Goals for 2019were toadvancetwonewplatform products Patent / product advancementandinnovation Orchard TherapeuticsandBioverativ (nowSanofi). as agreed withthemandreach key milestonesfor Novartis, The key objectivefor 2019istoservicetheGroup’s customers Partners / Capacity / Technology advancement innovation centre. effectiveness is planned alongwiththecreation of adiscovery/ force for the future. Aprogramme toenhancetheorganisation staff supportsystemstoensure abalancedproductive work the Group buildsaculture, competitiverewards/benefits and competition for key staff intheGroup’s fielditisessentialthat With therapidpaceof growth for theGroup, togetherwith Organisational development technology dealsandstarttwofeasibility studies. The planwastoout-licenceoneproduct, agree three platform A criticalsuccessfactorfor 2019wasthesigningof new deals. Business development

Performance againstpriorities the endof theyear. product out-licensingdealoralarge manufacturingdealastargeted by a or thecashin-flowasperbudget.Thiswasduetonotcompleting Group didnotachievetherevenue andEBITDA target asperthebudget extinguish theloan,however, whichwasakey objective.However, the Overall thefinancialobjectiveswere notmet.TheGroup didmanageto discovery/innovation hubwasalsoestablished. creation of theWindrushInnovation Centre, whichistheGroup’s management developmentprogramme and talentmanagement.The were alsorolled outtoincludeannualperformance management, structures andbenefits.Theorganisation effectiveness programmes developed andcommunicated toincludecompetitivegradingandpay These objectiveswere metinfull.TheReward strategy wassuccessfully goal of signingtwonewfeasibility studieswasachieved,however. only twowere signed(NovartisandSanten)bytheendof 2019. The product wasnotachievedandof thethree platform technologydeals The objectiveswere onlypartiallymet.Theplantoout-licenceone studies. Axo-Lenti-PD hasmovedforward inclinicaldevelopmentintocohort2 Microsoft collaboration isunderwaybuthasonlybeenpartiallymet. inventions filed for theplatform process. Digitaladvancementviathe proof of concepttopre-clinical studies,alongwithtwonewpotential two newprogrammes OXB-203 andOXB-302 progressing through These goalswere mainlymet.TheGroup strengthened thepipelinewith note 36of thefinancialstatements for furtherinformation onthisissue performance isfairintermsof theobjectiveshaving beenmainlymet.Refer development workpackages, butbelievethat theassessmentof issue identifiedinApril2020with regards tothecustomer commercial commissioning of Oxbox wasachievedontime.TheGroup doesnotethe progression of theCFprogramme. Inaddition,thehandoverand the Orchard Therapeuticsprogramme asagreed, alongwithsuccessful expanding theportfolio of products withthem.TheGroup alsoprogressed Novartis withtheconversiontoasuspensionproduction process and These targets were mainlymet.TheGroup achievedkey milestonesfor C B A A A C B B B Oxford Biomedica plc|Annual report andaccounts2019 Objectives setfor2020 Strategic report implementing abusinesschange portfolio. enhance theGroup’s organisation effectiveness programme through implementation theGroup’s ESGtargets. Thegoalin 2020isalsoto 2020. Stakeholder engagementisalso veryimportant,aswellthe systems toensure abalancedproductive workforce for thefuture in build aculture of competitiverewards/benefits andstaff support competition for keyto staff intheGroup’s fieldthe Group continues With therapidpaceof growth for theGroup, togetherwith Organisational development deals andstarttwonewfeasibility studies. plan istoout-licenceoneproduct, agree three platform technology The key successfactorfor 2020willcontinuetobenewdeals.The Business development the newsegments. looking tocreate internaldivisionsfor financial reporting alignedwith strengthening theStatement of financialposition.TheGroup isalso manufacturing dealsandaproduct outlicensingdeal,alongwith to beasignificantchallenge.Assumptionsinthebudgetincludenew aggressively growing saleswithstrictcontrol of costs,theseare going targets whichare driven bythebudget.Setinregime of The financialobjectives for 2020are toachieve revenue andEBITDA Financial objectives platform that isessentialtokeep theGroup aheadof thecompetition. and process (rapidprocess andimproved process) innovations tothe Group’s portfolio, alongsidetechnical(twonewpatentable inventions) In 2020, thegoalistoadvancetwonewplatform products intothe Patent / product advancementandinnovation that appropriate regulatory approvals are received for Oxbox. partners. Inaddition,itisfundamentaltotheGroup’s future success with themandreach key milestonesfor Novartisandotherkey The key here in2020istoservicetheGroup’s customersasagreed Partners / Capacity / Technology Advancement Objectives setfor2020 CONSORTIUM GENE THERAPY UK CYSTIC FIBROSIS

Strategic report 37 38 volumes asaresult of Novartis’continuedcommercial roll-out of Kymriah with Axovant, Sanofi (Bioverativ) andtheUK Cystic Fibrosis GeneTherapyConsortium,andincreased bioprocessing commercial developmentrevenue increased by17%withgrowth drivenbythenewcommercial arrangementssigned The Group has continued to build on the significant commercial success achieved during 2018. Bioprocessing and Property toaddouroffering. selective investmentsininfrastructure tobothhave thecapacityfor newcustomersandtoinnovate valuableIntellectual first timeinthisnewfacility. Thiswillprovide ourcustomerswithanendto offering. Wewillcontinuetomake to beproducing commercial andclinicalbatches in2020. Importantly, theGroup willbringFill&Finishinhousefor the investments initsgoaltoindustrialisetheprocess of makingLentiviralvectors.Thefirsttwoclean rooms are expected In 2019, theGroup movedtowards completionof phase1of itsOxbox bioprocessing facilityandmademanyother Operational transformation Financial review Strategic report Oxford Biomedica plc|Annual report andaccounts2019 — — Selected highlightsare asfollows: from newInvestorNovoHoldingswhichwasusedtofullyrepay the£43.6 million($55million)Oaktree loan. The Group alsomadesignificantimprovements toits Statement of financialpositionwith£53.5 million ofequityraised AXO-Lenti-PD Parkinson’sdiseaseclinicaltrial,triggeringa£11.5million($15million)milestone toOxford Biomedica. A significantclinicalmilestonewas reached byAxovant withthedosing of thefirst patient inthe secondcohort ofthe signed inDecember2019, andanewresearch anddevelopmentcollaboration wassignedwithSanten. A 5yearextensiontothecurrent commercial supplyagreement withtheGroup’s longtermpartner, Novartis,was having approved reimbursement in20countries.

agreements. revenues are, bynature, hard topredict especiallywhenconnectedtotheexecution of newlicenceandsupply signing theSanofi (Bioverativ) andAxovant agreements in2018. Thetiming of receipt of milestone andlicence Axovant milestoneandstrongly growing royalties unabletocompensate for the sizablelicenceincomereceived on business hasnowincreased by557%since2013. driven bydoubledigitgrowth across bothactivities.Revenuesfrom thebioprocessing andcommercial development on yeargrowth. Despitethecapacityconstraintswithinbusiness,growth infullyearrevenues of 17%wasachieved Revenues fr Revenues fr om the underlying bioprocessing and commercial development business continued to show good year om theunderlyingbioprocessing andcommercial developmentbusinesscontinuedtoshowgoodyear om milestones, licences and royalties declined 36% on the prior year with the £11.5 million ($15 million) om milestones,licencesandroyalties declined36%ontheprioryearwith£11.5million($15million) Chief FinancialOfficer Stuart Paynter as priorperiods. signed inthecurrent aswell successful partnerships growth aswebuiltonthe continuing toshowgood and underlyingrevenues Oxbox bioprocessing facility with theconstructionof the operational transformation “2019 hasbeenyearof

” ®

across the globe with the product now across the globewiththeproduct now

future growth inactivities2020andbeyond.Headcountrose from 432at December2018to554at theendof 2019. increasing customerdemand,bothfor bioprocessing andcommercial developmentservices,thereby positioningfor the Oxbox bioprocessing facilitycomingonlinein2020. ThisinvestmentisexpectedtoallowtheGroup tomeet facility costshave increased astheGroup investedheavily initsbioprocessing operations andpeopleinpreparation for Operating costs,includingCostof Sales,grew by30%,and29%whennon-cashitems chart oppositeshowsthegrowth inoutputsince2013. commercial developmentrevenues increased from theprioryearwithdoubledigitgrowth across bothactivities.The worth of licenserevenue received in2018asaresult of theAxovant andBioverativ (Sanofi) deals.Bioprocessing and increase intheBioprocessing andcommercial developmentrevenue, wasjustnotsufficientto offsetthe £18.3 million the dosingof thefirstpatient inthesecondcohort of theAXO-Lenti-PD Parkinson’sdiseaseclinicaltrial,andthe17% The slight decrease in revenues was largely driven by the fact that the £11.5 million ($15 million) milestone triggered with Overview — — — — — — — Oxford Biomedica plc|Annual report andaccounts2019 400 600 200 300 500 450 250 350 550 100 150 50 0

otal revenues decreased by 4%over2018, buthasnowincreased by371%since2013whentherevenue generating Year-end headcount bioprocessing facility. Cash a ($55 million)Oaktree loanfacility. £53 investments explainedabove. Cash usedinopera £5.7 million(2018:£2.5million). The Pr bioprocessing facilitycomingonlinein2020. revenue and investmentbytheGroup intoitsbioprocessing operations andpeopleinpreparation for theOxbox Opera of specification. product for which revenue has previously been recognised and which may be reversed should the product go out In 2019theGr Platform divisionwascreated. T 0321 0521 0721 2019 2018 2017 2016 2015 2014 2013 .5 millionof equitywasraisedfrom newInvestorNovoHoldingswhichwasusedtofullyrepay our£43.6 million ting EBITDA and operating profits slipped back into a loss-making position due to lower milestone and licensing ting EBITDA andoperating profits slippedbackintoaloss-makingpositionduetolowermilestone andlicensing oduct divisionmadeanOperating EBITDA t 31Decemberwas£16.2 millionreflecting thecontinuedcapitalexpenditure onthenewOxbox oup didnotrecognise revenues of £1.8 million(2018:Nil)relating toanestimate of bioprocessed tions of £6.6 millionin2019(2018:£9.2 millioninflow) reflected revenuemixandtheoperational 40 60 20 30 50 45 65 70 25 35 55 10 15 0 5 £m Revenue ocessing and process ocessing andprocess 0321 0521 2017 2016 2015 2014 2013 Biopr Licence, milestonesandgrants development (darktints) (light tints) 1 profit of £6.5 million(2018:£3.6of million)andanoperating profit

082019 2018 1 are excluded. Manpower and are excluded. Manpowerand 2 ting EBITDA (EarningsBefore Interest, 1

is provided onpage42. share options. Areconciliation toGAAPmeasures loss allnon-cashitems,includingthecharge for cash flowasitexcludesor from operating profit measure often usedasasurrogate for operational & loss,andShare BasedPayments)isanon-GAAP Opera investments andassetsa Tax, Depreciation, Amortisation, revaluation of measures isprovided onpage41. payment charge. Areconciliation toGAAP through profit &lossandtheshare based value adjustmentsof assetsheldat fairvalue amortisation, revaluation of investments,Fair Non-cash itemsincludedepr t fair value through profit t fairvaluethrough profit eciation, eciation,

Strategic report 39 40

Headcount Non-Financial Key PerformanceIndicators Operations Revenue £m Key FinancialandNon-financialPerformance Indicators and willseektoprovide maximalreturns toshareholders accordingly. studies in the coming 12-18months.The Group will continue to assess thefinancialrisk/reward profile of these projects which programmes itwouldfocus oninpre-clinical developmenttopotentiallytake through intoearlystageclinical seek partnershipsfor later stageclinicalstudies.TheGroup hasrecently undertaken areview of itspipelinetodetermine The Group willcontinueitsproven strategy of developingitsproprietary technologies,processes andproducts, andwill new strategic commercial partnershipstobuildontheplatform of establishedgrowth. that itcontinuestofoster itscurrent strong customerrelationships, whilstcontinuingtheGroup’s stated aimof targeting development andbioprocessing revenues are expectedfrom thesepartnershipsinthefuture. TheGroup willensure Group’s customer base and bolstered theGroup’s commercial development revenues in 2019. Additional commercial and developmentcollaboration withSantenin2019have strengthened theGroup’s commercial pipeline,diversifiedthe Consortium, thefiveyearextensiontocurrent commercial supplyagreement withNovartis,andanew research The signingof commercial contractsin2018withAxovant, Sanofi (Bioverativ) andtheUK Cystic Fibrosis GeneTherapy expenditure in2019. a £2.3millionincrease intheR&Dtaxcredit astheGroup incurred additionalqualifyingresearch anddevelopment share price gave upsomeof thelarge gains(2018:£6.0 million)achievedduring2018, althoughthiswasfullyoffset by The Group hasalsorecognised a£1.9 millionlossonrevaluation of theOrchard Therapeuticsinvestmentassetafter the Financial review Strategic report Oxford Biomedica plc|Annual report andaccounts2019 3 ThisisPurchases of property, plantandequipmentasperthecashflowstatement whichexcludes additionstoRight-of-use assets.A reconciliation toGAAPmeasures isprovided onpage44. ting EBITDA (EarningsBefore Interest, Tax, Depreciation, Amortisation, revaluation of investmentsandAssetsat fairvaluethrough profit &loss,andShare BasedPayments)isanon-GAAP measure often used 1 2 Cashburnisnetcashgenera Cash flow Financing Opera as asurrogate for operational cashflowasitexcludes from operating profit orlossallnon-cashitems,includingthecharge forshare basedpayments.A reconciliation toGAAPmeasures is provided onpage42. Average Capex Licences, milestones&royalties Loan Year-end Cash burn Operating profit / (loss) Opera Bioprocessing / commercial development Cash genera Cash ting EBITDA 3 2 ted from/(used in)operations 1 ted from operations plusnetinterest paidpluscapitalexpenditure. Areconciliation toGAAPmeasures isprovided onpage44. (14.5) 2019 (6.6) 26.3 25.8 (5.2) 16.8 64.1 16.2 47.3 500 554 – 2018 66.8 40.5 26.3 32.2 41.2 13.9 13.4 10.1 432 377 9.2 1.9 2017 36.9 31.8 (5.7) (1.9) (1.5) 1 37.6 295 321 2.0 9.8 5.8 4.3 2016 (11.3) 22.6 (5.9) 34.4 27.8 15.3 256 11.5 (7.1) 247 6.4 5.2 (14.9) 2015 (12.1) (14.1)

29.8 16.6 15.9 27.3 11.3 196 231 4.6 9.4 Oxford Biomedica plc|Annual report andaccounts2019 relevant nature withtheyearonmovementexplainedin secondtableonthenextpage. and Netprofit/(loss) section.Expenses items includedwithin Total Expensesare thencategorised according totheir year onmovementinthesenon-cashitemsis then individuallyanalysedandexplainedspecificallyintheOperating performance measure. AsOperating profit/(loss) isassessedseparately asa key financialperformance measure, the the share optioncharge astheseare non-cashitemswhichdonotform partof theOperating EBITDA alternative research anddevelopment,bioprocessing andadministrative costsandhasremoved depreciation, amortisation and movements of theGroup’s operational expensesincludedwithinOperating EBITDA, theGroup hasaddedtogether In order toprovide theusersof the accountswithamore detailedexplanation of thereasons for theyearon Total Expenses on alike for like basiswith2018. prior year. IfIFRS16(Leases)was notimplementedat thestartof 2019, theOperating EBITDA losswouldbe£6.0 million profit generated in2018asa result of increased operational costandlowerlicense revenues whencompared tothe Oxbox bioprocessing capacity. TheOperating EBITDA lossof £5.2 millionis£18.6 millionlowerthanthe£13.4 million growth inbioprocessing andcommercial development revenues andinbringingonlinethefirsthalf of 2020additional Revenue decreased by4%in2019whilsttheGroup’s costbasegrew by29%to£70.2 millionbothtoaccommodate the ting EBITDA (EarningsBefore Interest, Tax, Depreciation, Amortisation, revaluation of investmentsandAssetsat fairvaluethrough profit &loss,andSharea BasedPayments)isanon-GAAP measure often usedas 2 Non-cashitemsincludedepreciation, amortisation, revaluation of investments,Fair valueadjustmentsof available-for-sale assetsandtheshare basedpaymentcharge. 1 £m Operating EBITDA now reduced tojustover50%of revenues aswecontinuetodiversifyourcustomerbaseandrevenue streams. The largest portionof theGroup’s revenue continuestobederivedfrom itsrelationship withNovartis,althoughthishas signing of theSanofi (Bioverativ) andAxovant agreements not recurring. represented adecrease of 36%from theprioryeardueto£18.3 millionof licenceincomereceived in2018onthe Revenues from licencefees, milestonesandroyalties, includingthe£11.5million($15million) Axovant milestone, bioprocessing volumes. provided to new customers Cystic Fibrosis Consortium, Axovant and Santen, as well as growth in Novartis commercial main contributortogrowth hasbeentherevenues generated from increased commercial developmentservices commercial developmentincreased by17%to£47.3 million(from £40.5 millionin2018),andisup557%since2013. The Revenue decreased by4%to£64.1 millionascompared to2018(£66.8 million).Revenuegenerated from bioprocessing/ Revenue Operating EBITDA andOperating Profit/(loss). the decisionthat theKey FinancialPerformance Indicators againstwhichthebusinesswillbeassessedare Revenue, relevant GAAP measures, provide anaccurate reflection of theGroup’s performance overtime.TheBoard hastaken Performance Indicators (refer tableabove).TheGroup believesthat theseNon-GAAP measures, togetherwiththe The Group evaluates itsperformance bymakinguseof alternative performance measures aspartof itsKey Financial £m Operating (loss)/profit Non cashitems Revenue Revenue Other income Total expenses Operating EBITDA

Opera surrogate for operational cashflowasitexcludes from operating profit orlossallnon-cashitems,includingthecharge forshare basedpayments. A reconciliation toGAAPmeasures is provided onpage42. 2 1 (70.2) (14.5) 2019 2019 (9.3) (5.2) 64.1 64.1 0.9 (54.5) 2018 2018 66.8 66.8 13.9 13.4 0.5 1.1 (41.3) 2017 2017 (3.8) (5.7) (1.9) 37.6 37.6 1.8 2016 2016 (37.9) (11.3) (4.2) 27.8 27.8 (7.1) 3.0 (30.9) 2015 2015 (12.1) (14.1) (2.0) 15.9 15.9 2.9

Strategic report 41 42 1 Net(loss)/profit (non cash) Foreign exchange revaluation R&D taxcredit Interest Operating (loss)/profit fair valuethrough profit andloss Change infairvalueof assetsat Revaluation of investments/ Operating andNetprofit/(loss) — — — — share optioncharge Depreciation, Amortisation and Operating EBITDA £m 3 Costof goodsplusresearch, development,bioprocessing andadministrative expensesexcluding depreciation, amortisation andtheshare optioncharge. 2 Research, development,bioprocessing andadministrative expensesexcluding depreciation, amortisation andtheshare optioncharge. ocessing costshave increased from thepriorperiodduetoadditional facilitycosts,headcountandrelated spendincurred duetotheGroup’s investmentinadditionalbioprocessing capacityat Oxbox. Itwasalso 1 £m £m Financial review Strategic report Oxford Biomedica plc|Annual report andaccounts2019 Total expenses Other costs External R&Dexpenditure Manpower-related other externalbioprocessing costs Raw materials, consumablesand Bioprocessing costs Research anddevelopment Operating expenses Administrative expenses Adjusted Operating Expenses Share optioncharge Amortisation Depreciation Total Expenses Cost of sales IfIFRS16(Leases) Biopr whilst thefacilitywasnotinuse. impacted bydowntimeat theGroup’s Yarnton bioprocessing facilityaswhenitwasconvertedfrom anadherent process tobioreactors, thecostswere notrecovered tocostof goodsbutremained inbioprocessing

materials, consumables and other external bioprocessing costshave increased as a result of the increase in as thedevelopmentwasfullytaken overbyAxovant at theendof 2018. External R&Dexpenditur increased revenues, aswellinanticipation of Oxbox comingonlineinthefirsthalf of 2020. 2019. This is as a result of increasing commercial development and bioprocessing capacity in line with the Group’s part of thedepreciation of theright-to-useasset(£0.7 million),andtheinterest ontheleaseliability(£0.7 million). implementation of IFRS16(Leases)at thestartof 2019, £0.8 millionworthof operating leasepaymentsnowform well asaforex lossof £0.6 million(2018:£1.3gain)assterlingweakened againstthedollar. Duetothe Other costswer The incr commercial developmentactivitiesandbioprocessing volumes,aswellhighermaterial andsubcontractedspend. Raw were notimplementedat thestartof 2019, theoperating losswouldbe£13.8 milliononalike for like basiswith2018. ease inmanpower-related costsisduetotheincrease intheaverage headcountfrom 377in2018to500 1 3 1 2 1 e higherduetoincreased facilitycostsfor theOxbox andWindrushInnovation Centre properties, as 1 e waslowerduetolevelsof pass-through clinicaldevelopmentspendfor Axo-Lenti-PD (14.5) (16.1) 2019 2019 2019 22.8 22.8 70.2 70.2 10.8 10.8 35.2 35.2 (5.8) (5.4) 22.6 34.5 (5.2) 70.2 41.9 (1.0) (1.9) (1.6) 35.7 (7.4) 11.9 1.4 1.4 4.8 7.4 – 2018 2018 2018 54.5 26.7 26.7 18.3 18.3 26.6 (6.2) (4.3) 54.5 33.3 (5.5) 18.0 (2.7) 13.9 21.2 13.4 (1.1) 1.9 1.9 7.6 7.6 6.0 2.5 1.2 7.5 7.4 – 2017 2017 2017 41.3 41.3 19.3 13.2 28.9 (9.0) 22.9 (9.3) (0.7) 41.3 (5.7) (6.1) (1.9) 21.6 (4.1) 18.4 (1.2) 1.7 1.7 7.1 7.1 2.3 3.3 2.7 7.3 – 2016 2016 2016 (16.6) (11.3) (0.6) 30.3 (0.3) (4.9) (4.2) 24.3 (3.3) 26.1 (4.1) 37.9 37.9 11.8 (7.1) 17.4 6.0 2.8 8.4 9.3 3.7 – – (13.0) 2015 2015 2015 (12.1) (14.1) 25.1 30.9 30.9 20.3 (2.0) (0.2) (0.4) (1.0) 27.0 (1.9) (1.3) 13.6 4.0 8.2 5.8 6.7 6.1 – – 3 researching anddevelopingnewgenetherapeuticproduct candidates. Oxford Biomedica plc|Annual report andaccounts2019 first pa £3.6 million)largely asaresult of the £11.5 million($15million)Axovant milestoneachievedinApril2019ondosingof the The Product segment has generated revenues of £13.1 million and anOperating EBITDA profit of £6.5 million (2018: commercial developmentservicestocustomers. from thissegmentthrough higherbioprocessing volumes,increased royalty paymentsfrom partners, andadditional of £11.7 million,ascompared toaprofit of £9.8 millionin2018. TheGroup continuestotarget increased profitability results were furtherimpactedbyadditionalinvestmentinheadcountandfacilitiesresulting inanoperating EBITDA loss partly offset byincreased bioprocessing volumesandadditionalcommercial developmentservicesprovided. Operational from newcustomersin2018asaresult of theAxovant andBioverativ (Sanofi) dealsdidnot recur. Thiswashowever The Platform segment in 2019 saw a decrease in revenue of 8% from £55.0 million to £51.0 million as license income and manufacturingcostsdownwithintheLentiVector to developnewpotentiallysaleabletechnology, improve theGroup’s current processes andbringdevelopment development activitiesfor third parties(i.e.thePartner programmes CDMObusiness),andinternaltechnologyprojects within two segments, namely the ’Platform’ segment which includes the revenue generating bioprocessing and process Reflecting thewaybusinessiscurrently beingmanagedbytheSeniorExecutive Team, theGroup reports its results Segmental analysis held dollardenominated Oaktree loan. a foreign exchange lossof £1.0 millionbeingrecognised whichwasmainlyasaresult of therevaluation of thepreviously and materials. Thenetlossin2019wasnegatively impactedbythedevaluation of sterlingagainstthedollar, resulting in tax credit in2019hasincreased duetoadditionalresearch anddevelopmentexpenditure, bothintermsof headcount incurred as aresult of theearlyrepayment of theloan,andinterest arisingontheadoptionof IFRS16(Leases).TheR&D loan wasrepaid at theendof June2019, althoughthisdecrease wasoffset byanon-cashaccelerated interest charge to the increased employee headcount. The interest charge of £5.4 million was lower than the prior year as the Oaktree depreciation arisingonleasedassetsfollowing theadoptionof IFRS16(Leases),andahigher share optioncharge due depreciation, amortisation and share option charge washigherin2019duetodepreciation onanincreased asset base, Therapeutics investmentassetafter theshare pricegave upsomeof thelarge gainsachievedduring2018. The The Operating EBITDA loss for 2019 is further negatively impacted by a £1.9 million loss on revaluation of the Orchard £m Operating (loss)/profit Operating EBITDA Revenue 2019 Operating profit/(loss) Operating EBITDA Revenue 2018 tient inthesecondcohort.Thesegmentalsogenerated an Operating profit of £5.7 million(2018:£2.5million). Platform (20.2) (11.7) 51.0 55.0 ® 11.4 9.8 Platform. Theothersegment,“Product“, includesthecostsof Product 13.1 11.8 6.5 2.5 3.6 5.7 (14.5) Total 66.8 (5.2) 64.1 13.9 13.4

Strategic report 43 44

Movement inyear Net proceeds from financing Cash burn £m — — — — — — — — — — movements across theyearare explainedbelow. The Group held£16.2 millioncashat 31December2019, having beguntheyearwith£32.2million.Significant Cash flow Financial review Strategic report Oxford Biomedica plc|Annual report andaccounts2019 Capex R&D taxcredit received operations Cash (usedin)/generated from Working capitalmovement Operating EBITDA operating loss Non-cash itemsincludedin Operating (loss)/profit Sale of investmentasset Interest paid,lessreceived from operations Net cash(usedin)/generated

as welllowerrevaluation gainsonAssetsat fairvaluethrough profit &loss. principally asaresult of lowerlicensefees, butalsoincreased operational investmentsinheadcountandfacilitycosts, The r equity raiseof £53.5 millionwhichwasusedtofullyrepay the£43.6 million($55million)Oaktree loan. The netpr on theOxbox bioprocessing facility. as aresult of the lowerlevelof cashgenerated from theGroup’s operations, andtheincreased capitalexpenditure Cash burn,theaggr purchases of equipmentandleaseholdimprovements for thenewOxbox manufacturingfacility. Pur £6 paid at theendof June2019. Inter as compared to2017. £0.6 millionfrom theprioryear. Thiswasduetothetaxcredit beingcappedasaresult of theprofits achievedin2018 Net cashusedinopera Cash usedinopera £13.4 millionprofit). This lossflowedthr The opera .3 millionof fundswasgenerated from thesaleof shares of theOrchard investmentasset. chases of property, plantandequipmentincreased from £10.1 millionto£25.8 million,mainlyconsistingof est paidduringtheyearwas£3.3 million,downfrom £4.7 millionintheprioryearasOaktree loanfacilitywas esult of theabovemovementsisanetdecrease incashof £16.0 millionfrom £32.2millionto£16.2 million. ting lossin2019was£28.4 millionlowerthantheoperating profit of £13.9 millionachievedin2018, oceeds from financingduring2019were £10.3 million,consistingalmostentirely of theNovoHoldings tions was£6.6 million,a£15.8 millionreversal from the£9.2 millioncashgenerated in2018. egate of theseitems,wastherefore increased from £1.9 millionin2018to£26.3 millionin2019 ough toOperating EBITDA whichdecreased by£18.6 milliontoalossof £5.2 million(2018: tions during2019at £3.5 millionwashelpedbya£3.1 millionR&Dtaxreceipt, down (26.3) (25.8) (16.0) (14.5) 2019 (6.6) (5.2) (3.3) (3.5) 10.3 (1.4) 6.3 9.3 3.1 2018 (10.1) (0.5) (4.2) (4.7) 12.9 19.8 (1.9) 13.9 13.4 17.9 9.2 3.7 – (10.8) 2017 (2.0) (9.8) (1.0) (5.7) (1.9) (1.5) 8.8 3.0 3.8 0.4 4.5 – 2016 (11.3) (11.5) (5.9) (6.4) (3.3) (1.8) (7.1) 17.5 6.0 4.2 4.1 1.2 – (29.8) (16.6) (14.9) 2015 (12.1) (14.1) (11.7) (4.8) (2.8) 25.0 (1.5) 2.0 3.2 –

— — — — — — — — — — Oxford Biomedica plc|Annual report andaccounts2019 provided aboveordonotincludeall claimsandtherefore theamountsmay beunderstated. required isinherently judgmental,andthere isariskthat thefinal settlementsare materially different totherange consider theaboveestimate sufficiently reliableto recognisea provision (if any)in respect ofthis matter. Theassessment no liabilityhasbeenrecognised at theStatement of financialpositiondate, asinmanagement’s opinionitistooearlyto and £1,000,000. However, asthere isnosuchclaimtodate andgiventheearlystageof theinvestigation into thecause, claim. Ifaclaimwere tomaterialise, theGroup estimates therangeof allpotential costscouldbebetween£250,000 extinguished eitherthrough re-performance of theaffected workpackages, orultimately form part of anypotential In addition,theGroup expectsthat thepotentialliabilityarisingwith regards totheaffected workpackages willbe within oneyear. potentially affected revenues relating tothework packages withtheliability recognised withinContractliabilitiesdue (IAS10) andhasassessedtheperformance obligations for whichtherevenue hasbeenrecognised andreversed all Asat 31December2019, theGroup regards thismatter asanadjustingpostStatement of financialpositionevent information relating tothismatter duetothevery recent timingof thisissuebeingidentified. Group. TheGroup hasbeenincommunication withthethird partybutisnotyetinapositiontoverifyorvalidate any performed on behalf of a customerin 2018 and2019 which potentiallycould give rise to a material claim against the Subsequent toyearendtheGroup identifiedanissue regarding anaspect of certainprocess development work rise toclaimsorpotentiallitigation againsttheGroup. The Group routinely entersintoarangeof contractualarrangementsintheordinary courseof businesswhichmaygive Events after theStatementoffinancialpositiondate–contingentliability The mostnotableitemsontheStatement of financialposition,includingchangesfrom 31December2018, are as follows: Statement offinancialpositionreview erred Incomedecreased from £5.0 millionin2018to£4.3 millionmainly duetothereclassification of a£2.3million ee loanbalanceof £41.2millionat 31December 2018wasfullyrepaid during2019after theGroup raised operty, plantandequipmenthasincreased by£30.1 millionto£61.9 millionasdepreciation of £5.8 milliononly t fairvaluethrough profit &lossdecreased by£6.3 millionasa result of thesale of Orchard shares, andby of 2019. Lease liabilitieso £53.5 millionequityfrom newInvestorNovoHoldings. The Oaktr capacity reservation fee andthefundsreceived inadvancefor Axovant process developmentactivities. Contract liabilitiesdecr leasehold improvements for thenewOxbox manufacturingfacility, aswellanincreased levelof operational activity. T qualifying for taxrelief. T of process developmentactivities,aswellthetimingof bioprocessing orders placedat year-end. T as lowerrawmaterial levelsafter plannedincreases instocklevelsat 31December2018duetoBrexit uncertainty. goods duetotheabilitymore accurately reflect thepercentage of completiononbioprocessing batches, aswell Inventories ha recognised upontheimplementation of IFRS16(Leases). Oxbox manufacturing facility, a £3.7 million Oxbox leasehold restoration asset, and £6.4 million of right to use asset partially offset additions of £29.6 million,mainlypurchases of equipmentandleaseholdimprovements for thenew Pr movement ininnovate capexgrantfundingof £1.5million. lease incentiveuponimplementation of IFRS16(Leases),partlyoffset bythe£0.4 millionSanten option andthenet Def £1.9 millionduetothedevaluation of theOrchard investmentbasedonthequotedOrchard share priceat yearend. Assets a rade andotherpayablesincreased from £11.4 millionto£14.3 million,duetothepurchases of equipmentand rade andotherreceivables increased from £30.6 millionto£33.7 million,duepredominantly totheincreased levels ax assetsincreased from £2.4 millionto£5.4 millionduetoincreased research anddevelopmentexpenditure ve decreased from £4.3 millionto£2.6 millionduetoworkinprogress balancesreleased tocostof f £8.4 millionwere recognised as required bytheimplementation of IFRS16(Leases)from thestart eased from £18.5 millionin2018to£14.9 millionduetotherelease of theNVSbioprocessing

Strategic report 45 46 Kymriah product now having approved reimbursement in 20 countries. New marketing approvals were seen in Japan with early stageconceptsandpre-clinical studies,andinitskey LentiVector opportunity existstoincrease shareholder valueandimprove patient outcomes.TheGroup willcontinuetoinvestin The Group continuestomake selectivestrategic investmentsinitsproducts andenablingtechnologieswhere the in thecoming12-18months. programmes itwouldfocus oninpre-clinical developmenttopotentiallytake through intoearlystageclinicalstudies licensing orspin-outof theseprogrammes, theGroup hasalsoundertaken areview of itspipelinetodeterminewhich The Group iscontinuingthedevelopmentof itsproprietary pipeline,andwhilediscussionsare ongoingfor furtherout- in 2020, whilstremaining focused onmeetingthegrowing demandsof itsexistingcustomerbase. in thisstrategically importantcollaboration since2013. NovartiscontinuestolaunchKymriah of afiveyearextensiontothecommercial supplyagreement withNovartisistestamenttothejointsuccessachieved The Group willcontinuetotarget improvements initscommercial relationship withitsexistingcustomers.Thesignature collaboration agreement withSantenPharmaceuticalCompany. partnerships inthefuture. TheGroup’s customerbasealsocontinuestodiversifywiththesigningof anewcommercial revenues in2019, withadditionalcommercial developmentandbioprocessing revenues expectedfrom these (Bioverativ) andtheUKCystic Fibrosis GeneTherapyConsortiumhave bolstered theGroup’s commercial development The Group istargeting improved financial performance in2020. The contracts signedin 2018with Axovant, Sanofi Financial outlook No otheramountshave beenprovided for inrespect of thismatter. this basisitistooearlytoassessthelikelihood of anassetarising,therefore nocontingentassethasbeenrecognised. however theGroup cannotdeterminetheextentof anycoveruntilfurtherinvestigation isundertaken asnecessary. On A contingent asset could potentially exist within the financial statements for the insurance cover that the Group maintains, Financial review Strategic report Oxford Biomedica plc|Annual report andaccounts2019 customer contractsfor process developmentandbioprocessing services. delivered orsecuringthebenefit of any upfront receipts from licensingouttheGroup’s intellectual property orwinnew known andexpectedrevenues from existing customersunderlongtermcontracts,whichare ongoingbut stilltobe these financialstatements iftheGroup couldnotsecure theexternalfinancing andcontinueto execute and recover identified that theGroup wouldnotbeabletocontinueitsactivities for at least12monthsfrom thedate of approval of review of thedetailedcashflow forecast prepared aspart of the goingconcernassessmentprocess. Theprocess to raisefundinginlinewiththeoriginallyplannedtimeline. Therefore, theBoard hasundertaken amuchmore rigorous of equitytotheinvestmentcommunityasplannedhasbecome verydifficultandthe Group hasnothadtheopportunity Due tovolatility inthefinancialmarkets created bytheimpact of the COVID-19 pandemic,fundraisingthrough issuance initiatives inorder tocontinueitsoperations andcurrent capabilities. Group requires additionalfinancinginthe form of equityfinancing,loanfinancingorothergovernmentfinance customers. DuetotheGroup’s scale-upof investmentsandstrategic decision toincrease it’sbioprocessing facility, the scenarios incorporating underperformance againstthebusinessplan,unexpectedcashout assessed identi In assessing the going concern assumptions,the Board has undertaken a rigorous assessment of theforecasts and strategic decisiontoincrease itsbioprocessing capacity. flow, thiswaslargely duetooperational scale-up of investmentsinits people andoperational capabilitiesaspart of the Although in2019theGroup recorded anoperating lossof £14.5 millionanddidnotgenerate positive operational cash The Group held£16.2 millionand£17.2 millionof cashat theendof December2019andApril2020respectively. notes tothesefinancialstatements. The financialposition of theGroup, itscashflowsandliquidityposition are describedintheprimarystatements and Going concern ® beingtheonlyCAR-T available inAsia.TheGroup willcontinuetotarget new strategic commercial relationships fi ed downside risks and mitigating actions. The downside risks include a number of severe but plausible ed downsiderisks andmitigating actions.Thedownsiderisks includeanumberof severe butplausible ® technologyplatform. ® across the globe with the across the globewiththe fl ows and fewer new ows andfewer new — Oxford Biomedica plc|Annual report andaccounts2019 Chief FinancialOfficer Stuart Paynter of the Group’s contingencyplanningisprovided onpage62. landscape in the UK, the Group has assessed the future impactof Brexit on its operations to be minor. Further details Although theUK’sdecisiontoleave theEuropean Unionmaysignificantly affect thefiscal,monetaryand regulatory Therefore theDirectors have continuedtoadoptthegoingconcernbasisof preparation inthefinancialstatements. — — — — going concernbasisfor thefollowing reasons: However, despitetheaboveuncertainties,Board a has theconfidence that theaccounts shouldbeprepared on circumstances, itmaytherefore beunabletorealise itsassetsanddischarge itsliabilitiesinthenormalcourseof business. or conditionsthat maycastsigni The abovesituation givesrisetoamaterial uncertainty, asde it wouldnotbeabletogenerate sufficientcashflowstosupportitslevel ofactivitiesbeyondthe third quarter of2020. If theGroup isunabletothesecure theexternalfinancingand receipt the revenues describedabove,ithasassessedthat customers andreduction inmilestones),areduction inassociated costsandlowerdiscretionary capitalexpenditure. assumptions includeareduction inrevenues byalmost30%(fewer newcustomer, lowerdemandfrom existing flow forecasts includetheGroup’s current assumptions,takingintoaccountthesevere butplausibledownsides. The Whilst itisdifficulttoestimate theimpact of COVID-19 duetotherapidlychanging nature ofthepandemic,cash oup’s abilitytocontinuebesuccessfulinwinningnewcustomersandbuildingitsbrandasdemonstrated by:

The Gr The Gr The Gr external debtfinanceas required. The — — customer basethroughout thelockdown period. The Gr Signingthesubstantiallicense,manufacturinganddevelopmentagr a potentialvaccinecandidate for COVID-19, withGovernmentsupportfor thefundingof theproject expected. Joining aConsortiumledbytheJennerInstitute,Oxf Group’s ability to potentially access the Government Coronavirus Business Interruption Loan Scheme and also oup’s abilitytocontrol capital expenditure costsandlowerotheroperational spend,asnecessary. oup’s historyof beingabletoaccesscapitalmarkets. oup haskey worker status whichallowscontinuityof providing servicestotheGroup’s financiallystable fi cant doubt on the entity’s ability to continue as a going concern and in such cant doubtontheentity’sabilitytocontinueasagoingconcernandinsuch ord University, torapidlydevelop,scale-upandmanufacture fi ned in auditing and accounting standards, related to events ned inauditingandaccountingstandards, related toevents eement withJuno(BMS)inMarch 2020.

Strategic report 47 48 the Group has with all its stakeholders. the Group haswithallitsstakeholders. These three valuesgovernthewaythat theGroup doesbusiness,howtheGroup works togetherandtheinteractions The Group’s companyvaluesare: ‘Have integrity’,‘Be inspiring’and‘Deliver innovation’. Values spirit of allhealthandsafety regulation andbestpractice. to monitor performance in this important partof the business. The Group is committed to meet both the letter and Health andSafety isastandingitemontheBoard’s agenda,andtheGroup has taken stepstoimprove themetricsused Oxford Biomedicacontinuestohave afirst-classsafety record, withno reportable incidentsinthe reporting year. improvement. Group planstorunasafety climate surveyinthefirstquarter of 2020toactivelyengageallstaff andidentify areas for they adequately reflect workingpractices.Improving employeeengagementisa focus for theyearahead,and organisation, andtheGroup hastaken stepstoimprove consultation indevelopingpoliciesand procedures to ensure materials, touseof displayscreen equipment.TheSafety ManagementSystem continuestoevolveandgrow withthe The Group’s Health and Safety Management System covers all aspects of its work, from working with biological Group endeavours tomaintainitsfacilitiesandequipmentthehigheststandards. as tominimisetheriskemployeesandanyoneelsewhomaybeaffected bytheGroup’s actsoromissions.The systematic evaluation allof activities,theGroup ensures that significantrisks are identifiedandcontrolled insuchaway Being abletodelivertheGroup’s products andservicesbothsafely andsustainably isthenumberonepriority. Viathe Safety People The Group’s strategy isfocused onanumberof mainareas: responsible way. TheGroup’s workisgovernedbyitsvalues. The Groups responsible businessmissionistodeliverlife changinggenetherapiestopatients inanethicalandsocially Dawson, theGroup’s Chiefexecutive Officer. to ensure itmeetsthisobjective.Theresponsible businesscommittee,whichhasbeenestablished,ischaired byJohn Oxford Biomedicaiscommittedtoitsrole asaresponsible businessandtheGroup hasdeveloped apolicyandstrategy Oxford Biomedica plc|Annual report andaccounts2019 consequences, wedowha Whatever thesituation and We always dotherightthing. Have integrity Responsible business Strategic report to deliveronourcommitments. decisions andcanbetrusted and partners.We make objective right for employees, patients t’s t’s

teamwork. Thr our passion,commitmentand challenges, engages and excites us. challenges, engagesandexcites us. environment whichpositively and behaviours, wecreate an We succeed togetherthrough Be inspiring ough our actions ough ouractions

solutions for patients. working tobringaboutbetter new ideasandcreative waysof continually improve bygenerating exceptional talent.Together, we scientific ex We deliverground-breaking to realise incredible results. We drive credible science Deliver innovation cellence by nurturing cellence bynurturing

Total All otheremployees Senior managers Directors Board includingNon-Executive share save schemes. The Group also provides all employees with the opportunity to own a share in the business through share option and long termdisability. TheGroup hasrecently improved maternity payprovision, andincreased sickpaybenefits. pension plan.TheGroup also provide employeeswithprotection shouldtheyfallsickorbeunabletoworkthrough Through theGroup’s comprehensive benefitsprogramme, employeesare encouragedtosave for thefuture, viathe the Companybyreceiving acashbonuslinked totheir grade levelandtheirownpersonalperformance. company-wide cashbonusschemewhichwillgiveemployeesat alllevelstheopportunitytoshare inthesuccessof specific paysurveyswhichinform thesalarieswhichare reviewed annually. In2020,a theGroup isintroducing The Group iscommittedtoproviding competitivereward packages for allemployees.TheGroup participate inindustry Reward positive impactontheGroup’s genderpayratio. Forfulldetailsof thereport pleasevisitthewebsiteat www.oxb.com. in representation of female employeesat themore seniorlevelsof theorganisation overthelastyear. This hashada The GenderPayGapReportfor 2019hasbeenprepared bytheGroup andtheGroup ispleasedtoreport anincrease Oxford Biomedica plc|Annual report andaccounts2019 is thenumberonepriority. and servicesbothsafely andsustainably Being abletodelivertheGroup’s products Delivering safely andsustainably The tableshowsthegendersplitacross theorganisation asat 31December2019: of race,gender, religion, national origin,disabilityoranyotherpersonalcharacteristics,andembracediversityinallforms. The Board andseniormanagementare fullycommittedtoproviding equalopportunitiestoallemployees,irrespective Diversity adherence tothevalues. share the values.Thevaluesare animportantfactorinmeasuringperformance, andtheGroup recognises and rewards The Group’s values are also reflected inthepeopleprocesses – theGroup looks for evidencethat the jobcandidates

Male 263 234 22 7 their ownpersonalperformance. receiving acashbonuslinked totheirgradeleveland opportunity toshare inthesuccessof theCompanyby scheme whichwillgiveemployeesat alllevelsthe The Group isintroducing acompany-widecashbonus Sharing inoursuccess Female 292 276 14 1 Total 554 510 36 8 % Male 47% 46% 87% 61% % Female 53% 54% 39% 13%

Strategic report 49 50 ensure that the Group isabletokeep allitsemployeesengagedasthebusinessgrows. related social media. The Group is currently reviewing its communication strategy, including the channels used to employees. Theseincluderegular all-employeetownhallbriefings,R&Dseminars,employeenewsletters,andwork- variety of communications channelstoshare information onthebusiness,science,andothertopicsof interest to The Group acknowledges the importanceof communication andconsultation across thebusiness.TheGroup usesa Employee Communication a travel managementprevention strategy andencouragingpeopletoworkfrom home. hygiene practices,provision of handsanitiserincommonareas, wearingof facemasks, staggeringof shifts,enforcing staff ontheongoingsituation andhasimplementedstepstocontainanyspread suchaspublicisinggoodpersonal possible spread of infection. TheGroup continuallyassessestherisks for employeesandregularly communicates with towards allemployees,andtherefore theGroup expectssomeof ourstaff tobe required toself-isolate toprevent the During theCOVID-19 pandemicthesafety andwell-beingof ourstaff isparamount. TheGroup hasaduty of care workplace. being. In 2020, the Group is also focused on providing support to help identify and manage mental health issues in the in additiontoproviding jobspecifichealthsurveillance,isalso available medical for referrals andadviceongeneralwell- The well-beingof theGroup’s peopleisveryimportant.TheGroup hasanon-siteoccupational healthservice,which, Employee Well-being who works inthefacilities. Training isalsoessentialfor ensuringcompliancewiththeGroup’s processes andthesafety andwellbeing of everyone number willbenefitfrom itin2020. their learningthroughout theprogramme. During2019, around 100managersattended thisprogramme and asimilar attend modulesinvariousmanagementrelated topicsoveraperiodof severalmonths,andare givensupporttoembed The Group hasamodularManagementDevelopmentProgramme whichisoffered toallmanagers at OXB. Managers the yearthere are arangeof developmentcourses,bothclassroom basedandon-lineoffered toallemployees. The Group investsinthedevelopmentof itspeopleat alllevels.Every employeehasadevelopmentplan,andthroughout Training andDevelopment advice ongeneralwell-being. surveillance, isalsoavailable for medicalreferrals and which, inadditiontoproviding jobspecifichealth The Group hasanon-siteoccupational healthservice, Well-being Responsible business Strategic report Oxford Biomedica plc|Annual report andaccounts2019 biological materials. disposal of chemicalwasteanddecontaminated qualified licensedcontractors for thecollectionand processing anddisposalof laboratory waste,anduses The Group complieswithallregulations coveringthe Disposal ofchemicalwaste Oxford Biomedica plc|Annual report andaccounts2019 skilled areas of ManufacturingandAnalyticaltesting. which are enrolled onatrainingschemeinthe highly including schoolleavers from thelocalcommunity The Group haseightapprenticeships inoperation Apprenticeship scheme Total SeeSaw (Group donation) SeeSaw (Employeedonation) Charity from theGroup meantthat Oxford Biomedicaraised£9,500 for SeeSawin2019. This includedparticipation intheOxford halfmarathon, a Fire walk andChristmasraffle. Theseactivitiesandadonation The Group’s HelpingHandsTeam andemployeesorganised andparticipated in anumberof eventsduringtheyear. their familieswhentheyfaceadeath inthefamily. registration 1076321). SeeSawisanOxford basedcharityproviding supportfor bereaved children, youngpeopleand This year the Group setupthe Helping Hands Team as part of its commitment to its chosen charity SeeSaw (charity Charitable Giving in thefuture. testing. TheGroup iscommittedtosupportingtheapprentices through supportandtrainingexpandingthescheme local communitywhichare enrolled onatrainingschemeinthehighlyskilledareas of ManufacturingandAnalytical and theUniversityof Kent. Currently theGroup haseightapprenticeships inoperation includingschoolleavers from the Group has establishedanapprenticeship schemeincollaboration withAdvancedTherapiesApprenticeship Community As part of the Group’s focus of delivering local benefits and providing high skilled jobs to the local community the Apprenticeship scheme To-Work schemeandinterest-free seasonticket loanstohelpminimiseitstraffic impactonthelocal area. and waste,pr as aresponsible neighbour, complyingwithnational andlocallawsregulations, particularlywithregard toemissions scheme andbyestablishinglinks withschoolsandotherlocaleducational establishments.TheGroup seeks tobehave this bydeliveringpositivebenefits for thecommunity, suchascreating newhighqualityjobs,establishinganapprenticeship The Group recognises thevalueof beingagoodlocalcitizen intheOxford community. TheGroup endeavours toachieve Community operty planningandthetraffic impactcausedbyitsemployees.The Group hasawell-established Cycle- Donation £9,500 £8,200 £1,300

Strategic report 51 52 10,000 12,000 14,000 Total including wastedisposalandtravel Other activities(estimated) important indicator of itsactivity. 2019 has alsoestimated itstotalCO The tables below show the Group’s usage in 2019 and 2018 of energy and water at its sites in Oxford, UK. The Group Greenhouse gasemissionsreport Group’s ResponsibleBusinesspolicyandwillform partof theenvironmental targets for thecomingyear. of its energy usage.Therecommendations from that auditwillbeincorporated intotheEnvironmental sectionof the Directive (2012/27EU).ThishasinvolvedanESOSPhase2energy assessmentbasedon2019data coveringallaspects As anorganisation of over250employeestheGroup hasengagedwithESOS, incompliancewithEUEnergy Efficiency Energy Savings OpportunityScheme(ESOS) No laboratory wastegoestolandfillsites. for thecollectionanddisposalof chemicalwasteanddecontaminated biologicalmaterials. with all regulations coveringtheprocessing anddisposalof laboratory waste,andusesqualified licensedcontractors ISO14001 with the aim of having a certifiable system in place by the end of the next reporting year. The Group complies Management System continuestoevolveandgrow withtheorganisation. TheGroup ismappingitssystemagainst neighbours andthelocalcommunity. Muchlike itsHealthandSafety ManagementSystem, itsEnvironmental Oxford Biomedica fully recognises its responsibility to minimisetheimpactof our activities on the environment, its Environmental policies&initiatives Environment Responsible business Strategic report Oxford Biomedica plc|Annual report andaccounts2019 Water supply Gas Electricity 8,000 6,000 4,000 2,000 0 Water use(cubicmetres) 2018 2019 2 emissions and has indicated its “environmental intensity” on a per employee basis, an emissionsandhasindicated its“environmental intensity”onaperemployeebasis,an Cubic metres MW hours MW hours Unit Usage 11,799 3,599 4,974 Usage peremployee 23.0 6.9 9.6 CO 2 emission(tonnes) 2,716 1,271 662 778 4 4.000 Total including wastedisposalandtravel Other activities(estimated) overseas. The Group iscommittedtothehigheststandards of ethicalconductandintegrityinitsbusiness activitiesintheUKand Integrity andEthics — — The Group continuestoreview itswaste managementsystemstomanagewastemore effectively. Thisincludes: Waste management have beenrefurbished toensure lightingisextinguishedinareas that are notcurrently inuse. with more efficientsystemcontrols. InitsWindrushlaboratories the Group haspassive infrared lightsensorsinall areas that efficient thantraditionallightingsystems.The Group islooking at reducingthe water usagethroughout itssitesinfacilities instance, whenexisting lighting needsreplacing the Group switches to LEDlightswhich are significantly more energy The Group is committed to energy efficiency andhas anumber of policies to decrease energy usage where possible. For Waste andEnergyefficiency 2018 Water supply Gas Electricity 2.000 3.000 Oxford Biomedica plc|Annual report andaccounts2019 5.000 1.000

0 use o r ecycling allpaperandcardboard waste,aluminium cans,glass,plasticsandprintertoner/cartridges. Electricity andgasuse(MWh) f different wastestreams toincrease processing efficiency. 2018 2019

Gas Electricity Cubic metres MW hours MW hours Our totalCO CO (2018: 2,365). from theprevious yearat 2,716 tonnes in2019 Unit 28.7 2 emissions2019% 0.2 24.4 2 emissions have reduced slightly emissionshave reduced slightly Usage 6,330 3,225 4,169 46.8

te activities Other supply Water Gas Electricity Usage peremployee

17.3 11.4 8.8 CO 2 emission(tonnes) 2,365 1,180 590 593 2

Strategic report 53 54 alternatives. TheGroup minimisestheuseof animalmodelsbycross-referring LentiVector animal testing.Theseprinciplesensure that animaltestingisonlyemployed whennecessaryandwhere there are no is committedtofollowing theprinciplesof thethree “Rs” insafety testing:replacement, refinement and reduction of administered topatients, andthere iscurrently noalternative tousinganimalmodelsaspartof thisprocess. TheGroup It isaregulatory requirement that allnewtherapeuticproducts mustbeappropriately testedfor safety before theyare Animal testing chain operates interritorieswithstrong commitmentstohumanrightssafeguarding. The Group’s facilitiesare alllocated intheUK,where itspoliciesaccord withhumanrightsregulations anditssupply Transparency Statement incompliancewithsection54of the Act whichcanbefound onthewebsitewww.oxb.com. legislation and the UK Modern Slavery Act2015. Oxford Biomedica’s Board of Directors has approved a Modern Slavery The Group fullyrespects humanrightsandconductsitsbusinessinaccordance withtheletterandspiritof UKHumanRights Human rightsandanti-slavery and theGroup alsodisclosesitstrialsonaUSgovernment-sponsored website(www.clinicaltrials.gov). Relevant trialsintheEUandEEAare automatically postedontheEUClinicalTrials Register(www.clinicaltrialsregister.eu) The Group isalsocommittedtotransparency, andthewebsite(www.oxb.com) provides information onongoingclinicaltrials. and legislation. procedures inplaceunderacontrolled QualityManagementSystem toensure compliancewithappropriate guidelines institutional review boards at clinicaltrialsites,before anypatients are treated. TheGroup alsohasstandard operating the protocols are agreed withtherelevant national regulatory authorities, aswelllocalethicscommitteesand conduct of itsclinicaltrials.TheGroup’s clinicalstudiesare designedwithpatient safety asaparamountconcern and The Group instilstransparency, safety andethicsinallaspectsof itsresponsible business,including thedesignand Clinical trials authorities. investigated withdisciplinaryactiontaken where necessary, uptoandincludingdismissalreporting torelevant suspected casesof misconductinconfidence andwithout fear of retaliation. Concernsandallegations are thoroughly implementation, trainingand monitoring. Aspart of this effort, theGroup’s employeesare encouragedto report Oxford Biomedica’scomplianceactivitiesincludetheprevention anddetectionof misconductthrough policy Whistleblowing management iscommittedtoimplementingeffective measures toprevent, monitorandeliminate bribery. any form of briberyby, orof, itsemployees,agentsorconsultants oranypersonbodyactingonitsbehalf. Senior well asotherrelevant overseaslegislation andallemployeesreceive traininginthismatter. TheGroup doesnottolerate Oxford Biomedica’spolicyonpreventing andprohibiting briberyisinfullaccordance withtheUKBriberyAct2010as Anti-bribery Responsible business Strategic report Oxford Biomedica plc|Annual report andaccounts2019 regulatory authorities. ® platform data packages for platform data packages for

anti-bribery Social matters

Oxford Biomedica plc|Annual report andaccounts2019 Non-financial statement Strategic report Requirement the Group’s positiononkey non-financialmatters of theCompaniesAct2006. Thetablebelow, andinformation itrefers to,isintendedtohelpstakeholders understand The Group aimstocomplywiththenewnon-financial reporting requirements containedinsection414CA and414CB Chief Executive Officer John Dawson The Strategic report onpages15to55wasapproved bytheBoard on6May2020andsigneditsbehalfby: indicators N D on business activit on business P H P and outcomes Anti-corruption and Employees Environment rinciple risks and impact impact and risks rinciple olicy embedding due diligence escription of business model business of escription on-financial key performance uman rights uman y

– Auditservicespolicy. – Anti-corruption. local community and the environment. local communityandtheenvironment. with employees,customers,patients; the which coverstheGroup’s wayof working The Group hasaresponsible businesspolicy, – ITandinformation securitypolicy. – Whistleblowingpolicy. – – – Diversitypolicy. – Equalopportunitiespolicy. – – – the Group’s approach Policies and standards which govern Sla Da Health, sa Responsible businesspolicy Envir ta protection policy. very andhumantrafficking policy. onment statement. fety policy. .

page 24; Stakeholders page22to23. The Group at aglancepage16;Operational highlights The Group’s businessmodelpages20topage21. Risk managementandregulatory disclosure page58. page 62;AuditCommitteereport page71; Principle risks andeffective managementpage58to Anti-corruption/anti-bribery page54. page 71. activity duringtheyearpage69;AuditCommitteereport Governance frameworkandstructure page67;Board business pages48to54. community andcharitableworkpage51;responsible Stakeholders pages22and23;engagingwiththelocal 22 and23;Whistleblowingpage54. human trafficking statement page54;Stakeholders pages Review andapproval of theGroup’s modernslavery and website. website. pay gapreport page49andpublishedontheGroup’s remuneration compartedtoemployeespage87;Gender with thebusinesspage96;Diversity75;CEO’s numbers bygenderpages49;Board engagement Stakeholders page23;Peoplepages48;Employee and electricityusagedisclosures onpages52and53. pages 22and23;Environment greenhouse gasemissions Health andSafety disclosures onpage48;Stakeholders Risk management and additional information

Strategic report 55 As more and more commercial gene therapy treatments are approved by regulators in the US and EU come online, the challenge has evolved. The race is well and truly on to meet growing demand, bring costs down and industrialise the science. The Group is playing a major role in this. Oxford Biomedica plc|Annual report andaccounts2019

109 101 151 154 110 11 112 113 151 111 48 94 20 66 28 38 58 26 34 63 36 57 2 15 22 25 55 76 37 18 16 11 4 4 4 3 1 7

tion ted ted

Corporate governance 57 58 — — — The Group mayfailtodevelopsuccessfully aproduct candidate for many reasons, including: conduct clinicaltrialsandbioprocess drugsbefore theycanbemarketed. Thisdevelopment process takes manyyears. to theparticularproduct candidate. Inaddition,theGroup oritspartnerswillneedtoobtain regulatory approvals to varies dependingontheproduct candidate, theindication beingevaluated, the trialresults andtheregulations applicable candidates todemonstrate safety and efficacy. The number of pre-clinical studies andclinicaltrialsthat willbe required To develop apharmaceuticalproduct itisnecessarytoconductpre-clinical studiesandhumanclinicaltrialsfor product Pharmaceutical productdevelopmentrisks Key risksspecifictoOxfordBiomedica’scurrentoperations — — — — — The Group’sriskmanagementframeworkisasfollows: Risk managementframework assessment of therisks facingtheGroup, includingthosewhichcouldthreaten itsbusinessmodelandfuture performance. others are commontoalldevelopment-stagebiopharmaceuticalcompanies.TheDirectors have carriedoutarobust processes. TheGroup isexposedtoarangeof risks. Someof themare specifictoOxford Biomedica’scurrent operations, Risk assessment and evaluation is therefore an integral and well-established part of Oxford Biomedica’s management sector, andtheregulatory authoritieshave showncautionintheirregulation of suchproducts. have beenapproved for commercial use.Asaconsequencethere are significantfinancialanddevelopmentrisks inthe compared withotherindustrysectors.During2019there have onlybeenafew gene andcelltherapyproducts which Oxford Biomedica operates in the gene and cell therapy biotechnology sector which, by its nature, is relatively high risk Principal risks,uncertaintiesandriskmanagement Corporate governance Oxford Biomedica plc|Annual report andaccounts2019 —

F F F processes, are alsosubjecttoaudits. such SOPs are routinely subjectto audit by the relevant regulators and customers. Other SOPs, such as financial required for GMP, GCP and GLP any deviations from the SOPs must be identified and investigated. Compliance with which are required befollowed inorder tominimisetherisks inherent inthebusinessoperations. Where theseare S register isregularly reviewed bySETandkey risks are highlightedtotheBoard at eachformal meeting. and assessrisks inthebusinessandtoconsidermitigation andriskmanagementstepsthat canbetaken. Therisk from eacharea of thebusinessandchaired bytheChiefof Staff. This group meetsquarterlywitha remit toidentify Risk ManagementCommittee–Oxf is akey feature of eachsub-committee. Committee andtheTechnical DevelopmentCommittee.SETmembersattend thesemeetingsandriskmanagement Leadership Team (incorporates the Quality and Manufacturing Operations Committee), the Product Development monthly andthrough whichmuchof theday-to-daybusinessismanaged.Theseare theextendedOperational K Group toconsidertheoperational riskmanagementprocesses andrisks identified. relevant risks on eachoccasion.At leasttwiceayear, theSETmeetswithrepresentatives from theRiskManagement Senior Ex financial performance, reviewing significantfinancial reportingjudgementscontainedinthem. integrity of thefinancialstatements of Oxford Biomedicaandany formal announcements relating totheGroup’s the Group’s internalfinancialcontrols andtheinternalcontrol systems.TheAuditCommitteealsomonitorsthe Executive Team buttheAuditCommitteemonitorsprocesses andtheirimplementation aswellreviewing (SET) full presentation totheBoard onRiskoccurs.Theriskmanagementprocesses are theresponsibility of theSenior at eachof itsformal meetings,of whichthere at leastsixannually. However, twiceayearinMarch andSeptembera and for ensuringthemaintenanceof asoundsystemof internalcontrol. TheBoard reviews key risks withintheGroup Boar F ailure toestablishrobust bioprocessing processes; ailure todeveloptechnicalsolutions toachievenecessarydosinglevelsoracceptabledelivery mechanisms; ailure todemonstrate efficacy; ailure todemonstrate long-termsafety; tandard Operating Procedures –allareas of thebusinesshave wellestablishedStandard Operating Procedures ey managementcommittees–theGroup currently hasthree key management sub-committeeswhichmeet d of Directors –theBoard hasoverallresponsibility for riskmanagement,determiningtheGroup’s risktolerance ecutive Team –theSETgenerallymettwicemonthlytodiscusscurrent businessissuesandconsiders (SET) ord Biomedica has a Risk Management Committee comprising senior managers ord BiomedicahasaRiskManagementCommitteecomprisingseniormanagers implemented andacceptedbytheregulator. laboratories orthe bioprocessing sitebeingclosedor theclinicalstudiessuspended untilcorrective actionshave been MHRA toensure that theycomplywithGMP, GCPandGLPstandards. Failure tomeetsuch standards couldresult inthe Group’s laboratories, bioprocessing facilityand conduct of clinical studiesare alsosubject to regular audits by the to continualreview andthere canbenoassurance that suchanapproval willnotbewithdrawnorrestricted. The data before grantingapproval. Ifregulatory approval isobtained, theproduct candidate andbioprocessor willbesubject in development.Regulatory authorities mayimposerestrictions onaproduct candidate’s useormayrequire additional timelines. Similarly, there canbenoassuranceof gainingthe necessarymarketing approvals tocommercialise products the developmentstage,regulatory reviews of clinicaltrialapplications oramendmentscanprolong development facility, are regulated byhealthcare regulatory agencies,such astheFDA (USA),EMA(Europe), andMHRA(UK).During The clinicaldevelopmentandmarketing approval of theGroup’s product candidates, andtheGroup’s bioprocessing (v) Regulatory risk be abletoprovide sufficientbioprocessing capacitywhen required. clinical developmentorcommercial supplyinatimelyorcost-effective manner, northat contractbioprocessors will will beabletoadaptcurrent processes ordevelopnewprocesses suitablefor thescalerequired bylater stagesof required for later stagesof clinical developmentorfor commercial supply. There canbenoassurancethat theGroup at thesmallscalerequired bytheearlystagesof clinicaldevelopment maynotbeappropriate at thelarger scale prices, or that suitable new contractors will enter the market. Bioprocessing processes that are effective and practical currently abletobioprocess theGroup’s product candidates willcontinuetomake capacityavailable at economic that the Group will be ableto bioprocess the Group’s product candidates at economic cost or that contractorswhoare processes for whichthere are onlyafew suitablebioprocessors includingtheGroup itself. There canbenoassurance (i) Safety risks collaborations inrespect of product candidates. could have anadverseeffect onthedevelopment of otherproduct candidates, orontheGroup’s abilitytoenterinto impact ontheGroup’s share price.There isalsotheriskthat thefailure of oneproduct candidate inclinicaldevelopment the Group. There isariskthat thefailure of anyoneproduct candidate couldhave asignificantandsustainedadverse The failure of theGroup todevelopsuccessfullyaproduct candidate couldadverselyaffectof thefuture profitability — — Oxford Biomedica plc|Annual report andaccounts2019 quantities at acceptablecost.TheGroup’s LentiVector There canbenoassurancethat theGroup’s product candidates willbecapableof beingproduced incommercial (iv) Bioprocessing process risk such technicalimprovements orsolutionscanbeidentified. candidate’s characteristicssuchasthedeliverymechanismorbioprocessing process. There isnocertaintythat During thecourseof aproduct’s development,furthertechnicaldevelopmentmayberequired toimprove theproduct (iii) Technical risks sufficient to satisfy the relevant regulatory authoritiesthat the product shouldbegivenamarketing authorisation. that the efficacy data collected from the be pre-clinical studiesandclinicaltrials ofthe Group’s product candidates will may fail to show thedesired efficacy despite having progressed through initialclinicaltrials. There canbe noassurance necessarily predict theresults of later stageclinicaltrials.Unapproved product candidates inlater stagesof clinicaltrials alternative therapies.Theresults of pre-clinical studiesandinitialclinicaltrialsof theGroup’s product candidates donot Human clinical studies are required to demonstrate efficacyin humans when compared againstplaceboand/or existing (ii) Efficacy risks by theDSMBorreview bodydoesnotnecessarilyindicate that allclinicaltrialswillultimately besuccessfullycompleted. candidates, consequently affecting the Group’s timeline for profitability. Thecontinuation of aparticularstudy after review or inconclusiveresults from pre-clinical testingorclinicaltrialsmaysubstantiallydelay, orhalt,thedevelopmentof product can benoassurancesthat anyof theGroup’s product candidates willultimately prove tobesafe for humanuse.Adverse (DSMB), the relevant regulatory authorities or the Group itself may suspend or terminate clinical trials at any time. There Safety issuesmayariseat anystageof thedrugdevelopmentprocess. Anindependentdrugsafety monitoringboard ailure to obtainregulatory approvals toconductclinicalstudiesor, ultimately, tomarket theproduct; and F F ailure to recruit sufficient patients intoclinicalstudies. ® platform product candidates usespecialisedbioprocessing

Corporate governance 59 60 comparable with competingemployers. creating anattractive workingenvironment andensuring that theremuneration package offered toemployees is the required skillsandexperiencecouldadversely affect theGroup’s performance. TheGroup mitigates thisrisk by needs. Themarket for suchemployeesisbecoming increasingly competitiveandfailure torecruit ortoretain staff with The Group dependsonrecruiting andretaining highly skilledemployeestodeliveritsobjectivesandmeet itscustomers’ Attraction andretentionofhighlyskilledemployees they expect. takes extremely seriouslycustomerrelationship managementtoensure that customersandpartnersreceive theservice The Group isbuildingarevenue generating businessbyproviding itsLentiVector development of theproducts tobedelayedorcurtailed. candidates. The Group may not besuccessful in its efforts tobuild these third party relationships which may cause the programmes andmayseektodevelopstrategic partnershipsfor developingcertainof theGroup’s otherproduct The Group isseekingtoout-licenseorspinoutintoexternallyfundedvehiclesitsin-houseproduct development Business development the relevant product candidates for anyreason couldresult intheGroup losingpotentialrevenues. partners inwhichtheGroup hasafinancialinterest through IPlicences. Failure of thepartnerstocontinuedevelop The Group hasentered severalcollaborations andpartnerships,involvingthedevelopmentof product candidates by Collaborator andpartnerrisk endeavouring tomitigate theriskof beingoverlyreliant onNovartisbyseekingbioprocessing contractswithotherparties. such asFill&Finishinhouseorder toreduce theriskof failure viacontractingouttheservice. TheGroup isalso employees and,inparticular, inqualitymanagementprocesses. Inaddition,theGroup isalsobringingincertainprocesses The Group mitigates theriskof failingtomeetrequired specifications byinvestinginhighqualityfacilities,equipmentand As theGroup’s revenues from bioprocessing are growing therisktoGroup hasincreased inthelasttwelvemonths. suspended untiltheissuesare rectified withthepotential for loss of revenue. regulators and customers.Failure tocomplywiththestandards required couldresult inproduction operations being Group’s business.TheGroup’s bioprocessing andanalyticalfacilitiesare subjecttoregular inspectionandapproval by materials andcertainout-sourced services.Ifsuchsuppliersperform inanunsatisfactory manneritcouldharmthe to lossof revenues. Furthermore, theGroup relies onthird parties,insomecasessolesuppliers,for thesupply of raw specification duetocontamination orinadequate yield. Failure todeliverbatches tothe required specification maylead Novartis. Bioprocessing of lentiviralvectorsiscomplexandbioprocessing batches mayfailtomeettherequired The Group receives significant revenues from bioprocessing lentiviralvectors for third partiesandinparticular for Bioprocessing revenuerisk activities andtoreview progress regularly intheGroup’s Product DevelopmentCommittee. other externalparties,suchasContractResearch Organisations toplan,implementandmonitoritsproduct development changed fundamentallyoverthelastyear. TheGroup aimstomitigate theserisks byemployingexperiencedstaff and The threats from theaboveproduct developmentrisks are inherent inthepharmaceuticalindustryandhave not stage of development. suitable patients, ortheemergence of acompetingdrug,eitheronethat isapproved oranotherdrugintheclinical a varietyofof reasons suchasthespecifiedcharacteristicsbeingtootightlydefined resultinginaverysmallpopulation specified characteristics,potentiallycausingdelaysorevenabandonment of theclinicalstudy. Thiscouldbecausedby accepted intothestudy. Theriskexiststhat itproves difficultinpracticeto recruitthenumber of patients withthe specify thenumberof patients toberecruited intothestudyandcharacteristicsof patients whocanandcannot be Clinical trialsare establishedunderspecificprotocols whichspecifyhowthetrialsshouldbeconducted.Protocols (vi) Failure torecruit sufficient patients intoclinicalstudies Principal risks,uncertaintiesandriskmanagement Corporate governance Oxford Biomedica plc|Annual report andaccounts2019 collaborators. TheGroup iscontinuingtoinvestintheLentiVector becoming uncompetitivefrom apricingperspective,c)failure toprovide anadequate servicetobusinesspartnersand building this business for reasons includinga) failing to maintain a leadershippositionin lentiviral vector technology, b) revenues derivedfrom process development,bioprocessing andfuture royalties. TheGroup maybeunsuccessfulin ® technology in order to reduce this risk, and it also technologyinorder to reduce thisrisk,anditalso ® platform tothird partiesinreturn for Oxford Biomedica plc|Annual report andaccounts2019 — — — and commercial environment severalyearsintothefuture. Future commercialisation risks include: In thelongerterm,successof theGroup’s product candidates andthoseof itspartnerswilldependontheregulatory Longer-term commercialisationrisks Advances inothertechnologiesthesectorcouldundermineGroup’s commercial prospects. The geneandcelltherapysectorischaracterisedbyrapidlychangingtechnologiessignificantcompetition. Rapid technicalchange therapy products. imposed inthefuture. Thismayincrease thecostandtimerequired for successfuldevelopmentof geneandcell other products, applytogeneandcelltherapiesthere canbenoassurancethat additionalrequirements willnotbe either inEurope and/orintheUSA.Furthermore, specific regulatory requirements, overandabovethose imposedon prevention and/ortreatment of diseases.To date onlyalimitednumberof genetherapyproducts have been approved the sector, willdependontheacceptanceof geneandcelltherapybythemedicalcommunitypublicfor the The Group’s commercial success,bothfrom itsownproduct development andfrom supportingothercompaniesin Gene andcelltherapyrisk Broader businessriskswhichareapplicabletoOxfordBiomedica from others. affect theentitlement of theGroup tothe relevant intellectualproperty ortolicense the relevant intellectualproperty such intellectualproperty. There canbenoassurancethat changestothetermswithinlicenceagreements will not the circumstances under which the intellectual property was created and the provisions of any agreements covering Rights of ownershipover, andrights tolicenseanduse,intellectualproperty dependonanumberof factors,including develop thesameorsimilarproduct candidates ortechnology. candidates ortechnology, there canbenoassurancethat acompetitororpotentialwillnotindependently develop orobtainalternative technology. Where copyright,designrightand/or“knowhow”protect theGroup’s product assurance that theGroup willbeabletoobtainlicencesthese patents at reasonable cost,ifat all,orbeableto Third party patents may emerge containing claims that impact the Group’s freedom to operate. There can be no substantial costsandanuncertainoutcome. intellectual property. Furthermore, ifthe Group’s patents are challenged,thedefence of suchrightscouldinvolve there canbenoguaranteethat theGroup’s product candidates andtechnologiesare adequately protected by and theBoard giveshighprioritytothestrategic managementof the Group’s intellectualproperty portfolio. However, The Group’s successdepends,amongstotherthings,onmaintainingproprietary rightstoitsproducts andtechnologies Intellectual propertyandpatentprotectionrisk milestones from commercial partnerscouldbereduced. Any orallof theserisks couldresult intheGroup’s future profitability beingadversely affected asfuture royaltiesand —

justify theinvestment.Basedonclinicalstudiestodate, theGroup’s LentiVector Governments orotherpayersbeingunwillingtopayf Regula product candidates ormake themobsolete; pharmaceutical industriesare subjecttorapidtechnologicalchangewhichcouldaffect the success of theGroup’s The emer The willingnesso therapies willdependonassessmentsof theircost-benefitandcosteffectiveness; the uniquepotentialtoprovide permanenttherapeuticbenefitfrom asingleadministration. Thepricing of these tory authoritiesbecomingincreasingly demandingregarding efficacystandards orrisk averse regarding safety; gence of new and/or unexpected competitor products or technologies. The biotechnology and gence of newand/orunexpectedcompetitorproducts ortechnologies.Thebiotechnologyand f physiciansand/orhealthcare systemstoadoptnewtreatment regimes. or/reimburse gene therapy products at a level which would or/reimburse genetherapyproducts at alevelwhichwould ® platform product candidates have platform product candidates have

Corporate governance 61 62 the riskin shorttermagainstlabourshortages andsubsequent production delaysat ourkey suppliers. As partof the2020 strategy, theGroup hasincreased thelevelof finished goodsheldinwarehouses whichwillmitigate enforcing atravel managementprevention strategy andencouraging peopletoworkfrom home. situation, andhasimplemented stepstocontainanyspread suchaspublicisinggoodpersonal hygienepractices, areas. TheGroup continuallyassessesthe risks for employees,regularly communicates withstaff ontheongoing facilities through enhancedcleaning processes, staggeringof shiftsandtheprovision of handsanitiserincommon isolate toprevent thepossiblespread of infection. TheGroup hastaken actiontomitigate thespread of infection at our The Group hasadutyof care towards allemployees,andtherefore weexpectsomeof ourstaff tobe required toself- shortages incertaininventoriesglobally. and process developmentinventories.To date wehave notseenanyimpactbutweare aware there isthepotentialfor The Group continuestomonitorthepotentialimpactonsupply chain,withaparticularfocus onkey manufacturing any, anddoesnotcurrently expecttoexperience,significantsupplyissuesoranychangesinoverallcustomerdemand. working withstaff, customersandsupplierstomonitorany potential disruptionand,sofar, theGroup hasnotexperienced and GOV.UK guidance,toriskassessthe Group’s supplychainandtodirect theGroup’s phasedresponse. TheGroup is The Group hasimplementedadailyseniormanagementworking group tomonitorcurrent COVID-19 developments constantly monitortheongoingsituation. on revenue, supplychainandoperating facilitiesifthesituation continuesorworsens. Managementcontinuesto risks to the business. While the Group is yet to experience any significant impact from the virus, there may be an impact As aresult of the COVID-19 pandemic,theGroup hasconductedanassessmentof thepotentialfinancialandoperational COVID-19 government regulation towhichitissubject,andimpacttheregulatory approval processes for itsproduct candidates. condition andresults of operations. Inaddition,itmayimpacttheGroup’s abilitytocomplywiththeextensive trade agreement with the European Union, it could have a material adverse effect on the Group’s business, financial Union on behalf of its members. Although it is notpossible at thispointin time to predict fully the effects of the free UK couldloseaccesstothesingleEuropean Unionmarket andtotheglobaltradedealsnegotiated bytheEuropean Depending onthefree tradeagreement termsnegotiated betweenEUMemberStates andtheUKfollowing Brexit, the growth of its industries, includingthepharmaceuticalandbiotechnologyindustries. monetary andregulatory landscapeintheUK,andcouldhave amaterial impactontheUK’seconomyandfuture The impact of the UK’s departure from the European Union is not yet clear but it may significantly affect the fiscal, UK’s departurefromEuropeanUnion (“Brexit”) against thecurrencies inwhichitincursitsexpenses,thiscouldadverselyaffect theGroup’s future profitability. sterling. Inadditionifthecurrencies inwhichtheGroup earnsitsrevenues and/orholdsitscashbalancesweaken the Group’s results of operations andmayadverselyaffect theGroup’s financialcondition,eachstated inpounds unrealised gainsandlossesontranslation of theunderlyingcurrency intopoundssterlingthat mayincrease ordecrease matched, fluctuations inexchange rates betweenpoundssterling,theUSdollarandEuro may result in realised and foreign currency expenses.To theextentthat theGroup’s foreign currency assetsandpotentialliabilitiesare not although theGroup’s Treasury Policypermitscashbalancestobeheldinother currencies inorder tohedgeforeseen of itsexpenditure inUSdollarsandtheEuro. TheGroup’s cashbalancesare predominantly heldinpoundssterling, income from collaborative agreements andpatent licencesisreceived inUSdollarsandtheGroup incursaproportion The Group records itstransactionsandprepares itsfinancialstatements inpoundssterling,butsome of theGroup’s (b) Foreign currency exposure would nothave amaterial andadverseeffect ontheGroup’s future profitability andfinancialcondition. the levelof insurancecarriedbytheGroup noworinthefuture willbeadequate, orthat aproduct liabilityorotherclaim necessary insurancecoverwillbeavailable totheGroup at anacceptablecost,ifat all,orthat, intheeventof anyclaim, products. WhiletheGroup iscurrently abletoobtaininsurancecover, therecan benoassurancethat anyfuture inherent in theresearch, pre-clinical andclinicalevaluation, bioprocessing, marketing and useof pharmaceutical customers, suppliersand/orinvestors.Inaddition,theGroup isexposedtopotentialproduct liabilityrisks that are In carryingoutitsactivitiestheGroup potentiallyfacescontractualandstatutory claims,orothertypesof claimfrom (a) Product liabilityandinsurancerisk Financial risks Principal risks,uncertaintiesandriskmanagement Corporate governance Oxford Biomedica plc|Annual report andaccounts2019 Oxford Biomedica plc|Annual report andaccounts2019 and RobertGhenchev. Stuart Paynter, Lorenzo Tallarigo Seated, lefttoright: and JohnDawson. Stuart Henderson,Heather Preston Martin Diggle,Andrew Heath, Standing, lefttoright: Board ofDirectors Corporate governance

Corporate governance 63 64 — Nomina Committee membership: — Appointment: with majorbusinessinhealthcare andconsumergoods. Directors at AngeliniHoldingS.p.A., anItaliancompany From 01January2019DrTallarigo joinedtheBoard of Pisa (Italy)andaPMDfrom Harvard BusinessSchool. has aDoctorof Medicinedegree from theUniversityof ultimately asPresident of International Operations. He management, marketing andgeneralmanagement, number of areas includingclinicalresearch, product held variouspositionsof increasing seniorityina technologies. Previously, heworked at EliLilly, where he businesses that developnoveltreatments and identifying life scienceresearch tocreate successful member of Genextra,aholdingcompanyfocused on also ChiefExecutive Officerand remainsaBoard where heledthecompany’ssuccessfulIPO. Hewas was previously Chairmanof Intercept Pharmaceuticals Chairman of Oxford BiomedicainFebruary2016. He Dr. Lorenzo Tallarigo wasappointedasNon-Executive Chairman Dr. LorenzoTallarigo — None. Committee membership: — Appointment: Administration of Serono Laboratories (UK)Limited. at CephalonhewasDirector of Financeand acquisition of Zeneus byCephalon.Prior tohistime million USdollarsandin2005ledthe$360 1,000 people, andtoaturnoverof severalhundred many dealsbuildingtheEuropean businesstoover Development Europe. Whileat Cephalonheled Chief FinancialOfficerandHead ofBusiness the European operations of CephalonInc.,including Previously heheldseniormanagementpositionsin appointed ChiefExecutive OfficerinOctober2008. Non-Executive Director inAugust2008, andwas John DawsonjoinedOxford Biomedica’sBoard asa Chief Executive Officer John Dawson Board ofDirectors Corporate governance Oxford Biomedica plc|Annual report andaccounts2019 in February2016. Appointed asNon- Chief Executive OfficerinOctober2008. Appointed aDir tion Committee. ector in August 2008 and became ector inAugust2008andbecame Executive Director and Chairman Executive Director andChairman

— Remunera — AuditCommittee. Committee membership: — None. Committee membership: — Appointment: Accountants inEnglandandWales. plc. Heisamemberof theInstituteof Chartered was headof financebusinesspartnering at DeLaRue internal audit.PriortojoiningOxford Biomedicahe finance role before becomingtheglobalhead of outside of theUS. Hethenmovedtoa corporate Director of financebusinesspartnering for allbusiness Pharmaceuticals where hebecametheSenior European FinanceDirector. HethenmovedtoShire and life sciencesdivisionspriortobecomingthe and worked inavarietyof roles withinthehealthcare before movingtoEDS. HesubsequentlyjoinedSteris, qualified asachartered accountantwithHaines Watts the pharmaceuticalandhealthcare sectors.He Board inAugust2017. Hehas16years’experiencein Stuart PaynterjoinedOxford Biomedicaandthe Chief FinancialOfficer Stuart Paynter — Nomination Committee. — Appointment: the UKBioIndustryAssociation. Director of NovacytSA.Hewaspreviously aDirector of Chairman of TauC3 BiologicsLtd andaNon-Executive USA, includingVicePresident Marketing &Sales.Heis million andheldseniorpositionsat AstraABand growth andeventualacquisitionbyBTG for £220 plc where hemanagedthecompany’ssignificant Previously hewasChiefExecutive Officer of Protherics and SeniorIndependentDirector inMay2011. Board inJanuary2010andbecameDeputy Chairman Dr. Andrew Heath wasappointedtoOxford Biomedica’s Senior IndependentDirector Deputy Chairmanand Dr. AndrewHeath Chairman andSeniorIndependentDirector inMay2011. Appointed aDir Appointed aDir tion Committee. ector andChiefFinancialOfficerinAugust2017. ector inJanuary2010andbecameDeputy

Oxford Biomedica plc|Annual report andaccounts2019 — Nomination Committee. — Remunera — AuditCommittee. Committee membership: — AppointedaDirector inMarch 2018. Appointment: from theUniversityof Oxford. for thelast18years.Sheholdsadegree inMedicine she hasbeenaninvestorinlife sciencesandbiotech scientist, physicianandmanagementconsultant over 30yearsof experienceinhealthcare, asa Managing Partnerof PivotalBioVentures. Shehas Biomedica’s Board inMarch 2018. Dr. Preston isthe Dr. Heather Preston wasappointedtoOxford Independent Non-Executive Director Dr. HeatherPreston — None. Committee membership: — AppointedaDirector inOctober2012. Appointment: of ScancellHoldingsplcandProteome Sciencesplc. University of Oxford. HeisaNon-Executive Director Degree inPhilosophy, PoliticsandEconomics from Director of UBSBrunswick.HeholdsaMaster’s particular, where hewaspreviously apartnerand an expertinemerging markets andRussia,in sciences andbiotechfor nearly20years.Heisalso management, andhasbeenaninvestorinlife 30 years’experienceininvestmentbankingandfund Oxford Biomedica’slargest shareholder. Hehasover of funds,includingtheVulpes Life SciencesFund, Investment Managementwhichmanagesanumber Board inOctober2012.Heisafounder of Vulpes Martin DigglewasappointedtoOxford Biomedica’s Non-Executive Director Martin Diggle tion Committee. tion Committee. He isalsoontheBoard of Tempus LabsInc. in FinancialEconomics from theUniversityof Oxford. Economics from McGillUniversityandaM.Sc. degree issues. HeholdsaJ.Hons. B.A. degree inFinanceand advising life sciencecompaniesonawiderangeof London. Roberthasdeep corporate financeexperience banker at Moelis&CompanyandDeutscheBankin Prior tojoiningNovoHoldings,hewasaninvestment Partner andHeadof NovoGrowth at NovoHoldings. Director inJune2019. Robertiscurrently Senior Robert GhenchevwasappointedaNon-Executive Non-Executive Director Robert Ghenchev — Nomination Committee. — Remunera — AuditCommittee. Committee membership: — AppointedaDirector inJune2016. Appointment: and BioCityGroup. and London),theCellGeneTherapyCatapult Nucleus (theLife Sciencestradebodyfor Cambridge Non-Executive Director ontheBoards of One Norwich Research PartnersLLPandcurrently sitsasa is aformer Director of theBabrahamInstituteand where hewasHeadof Emerging Biotechnology. He Sciences. Priortothishewasapartnerat Andersen, he wasHeadof European Healthcare andLife 2016. Previously, hewasapartnerat Deloitte,where Director andChairof theAuditCommitteeinJune Stuart HendersonwasappointedaNon-Executive Independent Non-Executive Director Stuart Henderson — None. Committee membership: — AppointedaDirector inJune2019. Appointment: tion Committee.

Corporate governance 65 66 Chairman Dr. LorenzoTallarigo The following pagessetoutinmore detailtheactivitiesandmajormatters considered bytheBoard in2019. I willcontinueasChairmanwhiletheGroup completesasearch for myreplacement. served four yearsasChairman,Ihave informed theGroup of myintentiontoretire from Oxford Biomedica’sBoard. has addressed this issue by initiating a search for additional independent Non-Executive Directors. In addition, having longer met the requirement for half the Board to be comprised of independent Non-Executive Directors. The Board during 2019. The exception being that following the appointment of Robert Ghenchev in June 2019 the Board no Governance Code”).TheBoard considersthat ithasbeenlargely compliantwiththe2018Corporate GovernanceCode The FinancialReportingCouncilproduced arevised UKCorporate GovernanceCodeinJuly2018(the“2018Corporate occur during2020. whether theappropriate changeshave beensuccessfullyimplementedviaanexternallygenerated questionnaire will appropriate changes basedontherecommendations of thereport. Areview of the2019performance inrelation to of a Board meeting.Theindependentreport wasreceived infirstquarter of 2019 and theBoard isimplementingthe aspects of Board activities,interviewswitheachDirector individuallybytheexternalevaluator andanactiveobservation performance during 2018/2019. The review process comprisedthe completion of a questionnaire covering the various Between December2018andFebruary2019theBoard hadDeloitteLLPperform anexternalevaluation of theBoard’s Group’s key prioritiesandmanagingthekey risks facingtheGroup. attention to ensuring that the Group’s strategy remains appropriate andthat managementisfocused on deliveringthe committees are fit for alarger company. Withthisamount of changewithintheGroup theBoard haspaidparticular and committeesare intheprocess of beingreviewed inorder tounderstandwhetherthe current structure and during 2019. TheGroup hascontinuedtogrow substantiallyovertheyearandcorporate governanceframework The Group hashadagoodyear, withanincrease intheGroup’s commercial developmentandbioprocessing revenues Director, following NovoHoldings’strategic investmentof approximately £53.5 millionintheGroup. There has beenachangetotheBoard during2019. InJune,RobertGhenchevjoinedtheBoard asaNon-Executive for externalandindependentreview andchallengetotheExecutives. Board anditscommittees.TheBoard comprisesbothNon-Executive andExecutive Directors andprovides theforum Good governanceisessentialfor thelongtermsuccessof thebusinessandthisisultimately theresponsibility of the I ampleasedtopresent Oxford Biomedica’scorporate governance report for 2019. Dear Shareholder Corporate governancereport Corporate governance Oxford Biomedica plc|Annual report andaccounts2019

Oxford Biomedica plc|Annual report andaccounts2019 Business Development,Finance, InvestorRelations, HR,Operations andHealth&Environment andRisk Management. Management, Analytical Services, Clinical Development & Regulatory, Digital Strategy and Business Change Projects, days aheadof eachmeeting.Regularboard paperscoverResearch, Quality, Process R&D, ClientProgrammes &Alliance, Secretary. Board paperscoveringtheagendaandtakinginto accountsection172responsibilities itemsare circulated several The Chairmansetstheagendafor theBoard meetinginconsultation withtheChiefExecutive OfficerandtheCompany prepare reports for theBoard aheadof eachBoard meeting. The Board alsotakes a closeinterest inQuality, Health,Safety &Environment and RiskManagement. Each of theseareas — — — — — — — — of matters reserved for theBoard’s approval whichinclude: The Board’s powersandresponsibilities are setoutintheCompany’sarticlesof association andithasaformal schedule and twoExecutive Directors. management processes in place. Following changes during 2019 the Board comprisedsix Non-Executive Directors activities tocreate shareholder value.Indoingsoitensures that there are robust corporate governanceandrisk The Board iscollectivelyresponsible for promoting thesuccess of theGroup bydirecting andsupervisingtheGroup’s The Board CDC TDC PDC SET Board andtheSeniorExecutive Team andtheirrespective sub-committeesissetoutbelow: The finalstructure andcommitteeshave not yetbeen finalised,so the current governanceframeworkcomprises the process of beingreviewed inorder tounderstandwhetherthestructure andcommitteesare fit for alarger company. As theGroup hascontinuedtogrow overtheyear, thecorporate governanceframeworkandcommitteesare inthe Corporate GovernanceFramework

appointment andr Boar internal contr corpora financing andcapitalstructur acquisitions, disposalsandcapitalexpenditur the financialsta the Gr

– Commer – T – – SeniorEx Pr echnical DevelopmentCommitteeeOLT –ExtendedOperations LeadershipTeam (incorporates theQuality, Manufacturingand Operations Committee). oduct Development Committee. oduct DevelopmentCommittee. d membershipandremuneration; oup’s strategy; cial DevelopmentCommitteeRMC–RiskManagementCommittee. te governance; ecutive Team. PDC ol andriskmanagement; tements andaccountingpolicies; emuneration of auditors. TDC e; CEO –JohnDawson EOLT SET e; CDC Chair –Lorenzo Tallarigo The Board RMC Remuneration Committee Chair –Stuart Henderson Chair –Lorenzo Tallarigo Nomination Committee Chair –Andrew Heath Audit Committee

Corporate governance 67 68 the Board asawholeto consider. to externalprofessional advisersas required. Theappointment andremoval of theCompanySecretary isamatter for All Directors andtheBoard andits committeeshave accesstoadviceandservicesof theCompanySecretary, andalso Each Director isprovided withanappropriate inductiononappointment. Executive Directors. Directors, excluding theChairman. The Board isaddressing thisissuebyinitiating asearch for twoindependent Non- Corporate GovernanceCodewhichrecommends that halftheBoard shouldbeconsistof independentNon-Executive Since theappointmentof RobertGhenchevinthemiddleof 2019, theGroup hasnotbeeninfullcompliancewith2018 — — — — — — The current Board memberbiographiesare setoutonpages64to65. Report isonpages76to93incorporating theRemuneration Committeereport. Reports from theAuditand Nomination Committeesare includedinthissectionandtheDirectors’ Remuneration website (www.oxb.com). Committees. Thesecommitteesoperate underclearlydefinedterms of reference whichare disclosedontheGroup’s Certain responsibilities are delegated tothree board committees–theAudit,Nomination andRemuneration There isa cleardivisionof responsibilities betweentheChairmanandChiefExecutive Officer. — — — Board approval. Thestakeholder impactanalysisidentifies: the potentialimpactsonitsstakeholders are beingcarefully considered bymanagementwhendevelopingplansfor Directors in performing their duties under s172 of the Companies Act 2006 and provides the Board with assurance that approval that could impact on one or more of its stakeholder groups. The stakeholder impact analysis assists the have beenupdated torequire astakeholder impactanalysistobecompletedfor allmaterial decisionsrequiring its Boardroom discussions(furtherinformation ontheGroup’s stakeholders isonpages22to23. TheBoard’s procedures By thoroughly understandingtheGroup’s key stakeholder groups, theGroup canfactortheirneedsandconcernsinto Factoring stakeholder engagementintoBoarddecisions Corporate governancereport Corporate governance Oxford Biomedica plc|Annual report andaccounts2019

Group andassuchheisnotconsidered independentunderthe2018Corporate GovernanceCode. Robert GhenchevisSeniorPartnerandHeado Group’s largest investorandassuchheisnotconsidered independentunderthe2018Corporate GovernanceCode. Martin Diggleisaf Hea S Code following hisproposed re-appointment at theAGM. his lengthof tenure asaDirector, hewillnotbeconsidered independentunderthe2018Corporate Governance Andr UKCGC at thetimeof hisappointment. Lor who isr the pr potential benefitsandar tuart Hendersonisthechairmanof theAuditCommittee.Heisconsidered tobeindependent. enzo Tallarigo istheNon-Executive Chairman.DrTallarigo mettheindependencecriteriarecommended bythe ther Preston isconsidered tobeindependent. ew Heath, theSeniorIndependentDirector, wasconsidered tobeindependentduring2019, however, dueto ocedures andplansbeingimplementedtomitigate againstanyareas of concern;and esponsible for ensuringthemitigation plansare beingeffectively implemented. ounder of Vulpes Investment Managementwhich,through itsVulpes Life Sciences Fund, isthe eas of concernfor eachstakeholder group; f Novo Growth at Novo Holdingswhichisa10.1% investor inthe Oxford Biomedica plc|Annual report andaccounts2019 Board meetings.Theattendance of individualDirectors at Board andCommitteemeetingswasasfollows: The Board meetsregularly withmeetingdates agreed for eachyearinadvance.During2019there were sixregular Board meetings Corporate GovernanceCode,he willnotconsidered independentfollowing the2020AGM. notes that sinceAndrew Heath hasbeenappointed totheBoard for more thannineyears,inaccordance withthe2018 successor isappointedbefore the2020AGM, Lorenzo Tallarigo willnotoffer himselfup for re-election. TheGroup for hisreplacement. Lorenzo Tallarigo, therefore, intendstostandfor re-election at theAGM in2020. Intheeventa informed theGroup of hisintentiontoretire, however, hewill continue asChairmanuntiltheGroup completesasearch John DawsonandStuart Paynter willretire andbesubjecttore-election at theAGM in2020. Lorenzo Tallarigo has In line with the 2018 Corporate Governance Code, Andrew Heath, Stuart Henderson, Martin Diggle, Heather Preston, At theAGM in2020, Robert Ghenchevwillstandfor appointmenthaving beingappointed totheBoard inJune2019. compliance withthe2018Corporate GovernanceCodeall Directors willnowbesubjecttoannualre-election. of three thenumbernearest tobutnotexceeding onethird) retire from office by rotation. However, toensure after thelastAGM orhasservedfor three years,andonethird of theotherDirectors (oriftheirnumberisnotamultiple In accordance withthe articles of association, at eachAnnualGeneralMeeting(AGM) anyDirector whowasappointed Retirement ofDirectors — — — — — — — — — Board matters during2019included: Board activityduring2019 attendance. The Chairmanholdsmeetingsfrom timetowithNon-Executive Directors withouttheExecutive Directors in interim 2019financial results. of other occasionstoconsiderspecificadhocmatters includingtheapproval of the2018financialstatements andthe In additiontotheaboveregular meetings,theBoard (oranappointedsub-committeeof theBoard) metonanumber 1 RobertGhenchevwasappointedinJune2019 Andrew Heath John Dawson Martin Diggle Stuart Henderson Robert Ghenchev Stuart Paynter Heather Preston Lorenzo Tallarigo

Pr Review o The Gr Ongoing r The appointmento Reviewing businessdevelopmentopportunitiesincludingpartneringandcollabora Monitoring thepr A r results andAnnualReport,the2019interimresults announcement. Routinely eparedness for theimplications of Brexit. eview of theGroup’s strategy, conductedinMarch andSeptember. oup’s activitiessurrounding workforce engagement. f theDeloitteReportonBoard effectiveness. recurring items such as the approvals of the 2019 financial budget and objectives, the 2018preliminary eviews of theGroup’s riskmanagementprocesses andkey risks. 1 ogress of the Group’s priorityproduct developmentprogrammes. osbeAtne osbeAtne osbeAtne osbeAttended Possible Attended Possible Attended Possible Attended Possible f RobertGhenchevasaDirector. 6 6 6 6 6 6 6 3 Regular Board 6 6 6 6 6 6 6 3 ui omte Rmnrto omte NominationsCommittee Remuneration Committee Audit Committee 3 3 3 3 3 3 8 8 8 tion transactions. 8 8 8 1 1 1 1 1 1 1 1

Corporate governance 69 70 Important matters from all of these committeesare referred totheSET. — — There are twootherimportantcommittees: ensuring compliancewith GxP andother relevant requirements, monitoringexpenditure against budgetandriskmanagement. Within theirarea of responsibility thesecommitteescoverobjectiveandtarget setting,monitoring performance againsttargets, — — — and are attended by SET members andother relevant senior managersfrom the business.Thesesub-committeesare: There are three SETsub-committeescoveringthemajorbusinessoperational areas. Thesecommitteesmeetmonthly and employmentmatters, riskmanagementandSafety, Health&Environment. weeks anditsagendacoversthefullrangeof activitiesof theGroup, includingfinancialperformance, organisational Senior Executive Team TheChiefExecutive OfficerisJohnDawson.TheSETmeetsapproximately (SET). everytwo Mitrophanous, NickPage,JasonSlingsby, HelenStephenson-Ellis, Natalie Walter andDmitryZamoryakhin form the Operational management is conducted by the Executive Directors who, together with James Miskin, Kyriacos The SeniorExecutive Team anditscommittees (SET) Social media Investor relations Website 2018 AnnualReport presentations Results announcementsand Meetings withpotentialinvestors 2019 AnnualGeneralMeeting Meetings withexistingshareholders The Group hasengagedwithshareholders andpotentialinvestorsthrough thevariouschannelsbelow: Board byRobertGhenchevensuringaclearchannelof communication withVLSFandNovoHoldings. investor, isrepresented ontheBoard byMartinDiggleandNovoHoldings(10.1% shareholder), isrepresented onthe Director are alsoavailable for meetings with investors if required. Vulpes Lifethe Group’s SciencesFund largest (“VLSF”), points of contactare theChiefExecutive OfficerandChiefFinancialbuttheChairman andSeniorIndependent The Board recognises theimportanceof effective communication withshareholders andpotentialinvestors.Theprimary Communication withshareholders Corporate governancereport Corporate governance Oxford Biomedica plc|Annual report andaccounts2019 cial Development Committee (CDC) – which covers the external opportunities to out-licence and in-licence cial DevelopmentCommittee(CDC)–which coverstheexternal opportunities toout-licenceandin-licence

development; and technology orproduct candidates, and also togenerate partnershipopportunitiesfor manufacturing and product Commer and managementactions. The committeemeetsat leastquarterly toidentifyandassessrisks facingthebusinessand topropose riskmitigation Risk ManagementCommittee (RMC)–thiscommitteecomprisesseniormanagers fr initial conceptthrough toclinicaldevelopment; and coversquality, operational andmanufacturingmatters. Extended Opera and otherprocesses, includingcellandvectorengineering; T Pr echnical Development Committee (TDC) – covering the development of new and improved assays and production –coveringthedevelopment of newandimproved assaysandproduction echnical DevelopmentCommittee(TDC) oduct Development Committee (PDC) – covering the development of new gene and cell therapy products from oduct Development Committee (PDC) – covering thedevelopmentof new gene and cell therapyproducts from tional LeadershipTeam (eOLT) –incorporates theQualityandManufacturingOperations Committee The Group alsousesLinkedIn andTwitter toalertfollowers torelevant sectornewswhichisrelevant totheGroup. through itsenquiryinbox [email protected] The Group alsoendeavours torespond toallenquiriesfrom shareholders andpotentialinvestorsreceived provides notifications of announcements. reference for theBoard Committees.Investorsandotherscansubscribetoane-mailalertservicewhich regulatory announcementsandpress releases, copiesof theGroup’s financialstatements, andterms of The Group’s websitehttp://www.oxb.com containsdetailsof theGroup’s activitiesaswellcopies of The Group publishedits2018AnnualReportinApril2019. accessible toallshareholders andrecordings of whichare madeavailable ontheGroup’s website. interim results inSeptember 2019through RNSannouncementsaccompaniedbyanalystconference callswhichare The Group announcedits2018fullyearperformance andfinancial results inMarch 2019, andits2019halfyear provide furtheropportunitiestomeetpotentialinvestors.. conferences inEurope andtheUSA.TheCompanyalsoconductsinvestorroadshows periodicallywhich The CEO andCFOregularly make presentations andmeetpotentialinvestorsonaone-to-onebasisat investor chance tomeetDirectors after themeetingclosed. a as theformal business,includedapresentation bytheChiefExecutive Officer followedbyaQ&Asessionand The 2019AGM washeldinLondonon29May2019. Shareholders were invitedtoattend theAGM which,aswell with majorshareholders. John DawsonandStuart Payntermetwithmajorshareholders during2019. Lorenzo Tallarigo hasalsomet om all parts of the business. om allpartsof thebusiness.

— Oxford Biomedica plc|Annual report andaccounts2019 — — The AuditCommitteemetthree timesin2019: an internalauditfunction.However, theAuditCommitteeregularly reviews thisat itsmeetingswiththeexternal auditors. internal auditfunction.TheAuditCommitteeconsidersthat, giventhesize of theGroup, itisunnecessaryfor ittohave The 2018Corporate GovernanceCodestates that theAuditCommitteeshouldreview theeffectiveness of theGroup’s — — — website, are to: The primarydutiesof theAuditCommittee,assetoutinitswrittentermsof reference whichisavailable on the Group’s in theirbriefbiographiesonpages64and65. of the AuditCommitteeand,inMr. Henderson’scase,tobeChairof theAuditCommittee.Theirexperienceissetout Stuart Henderson,Heather Preston andAndrew Heath allhave relevant experiencewhichqualifiesthem for membership The AuditCommitteecomprisesStuart Henderson,Heather Preston andAndrew Heath. Audit Committeereport Board committeereports operation andmeetitsliabilitiesastheyfalldue,theviabilitystatement, issetoutonpage97. The Board’s assessmentof theprospects of the Board, itsexpectation that theGroup will be able to continue in and otherrisks. management sub-committeesallowsthemtomonitorandassesssignificantbusiness,opera risks facingtheGroup andformulating riskmitigation plans.Theactiveinvolvementof theExecutive Directors inthe of theriskmanagementprocesses withintheGroup whilsttheSETisaccountablefor thoseprocesses, identifyingthe of theGroup anditreviews current key risks at everyBoard meeting.TheAuditCommitteemonitorstheconduct The Board isresponsible for determiningthenature andextentof therisks it is willingtotake inachievingtheobjectives Risk management

with theGroup. TheAuditCommittee agreed that afinancialcontrol assessment willbeperformed onanannualbasis. process. TheAuditCommitteeapproved the current treasury policyanddiscussedthefinancialcontrol assessment as a result of the work the Group commissioned from PricewaterhouseCoopers (PwC) around the risk management the current taxstrategy. Anupdate ontheriskmanagementprocess waspresented totheAuditCommittee,whichwas concern. Theupdated 2018/2019insurancestrategy wasdiscussed andagreed. TheAuditCommitteealsoagreed with arrangements –impactanddisclosure. Othernotedmatters include inventories,taxation, deferred taxandgoing revenue recognition –bioprocessing estimate, revenue recognition; managementoverrideof controls; IFRS16lease significant risks intheauditstrategy includedcontract revenue recognition andIFRS 15(complexcustomeragreements); and financialcontrol assessment.TheAuditCommitteedebated and agreed the2019year-end auditstrategy. The 29 October2019–tor a numberof areas of thequalityof theauditandnosignificantconcernsarose; statement. The auditors’ opinion was reviewed and no issues or concerns were raised. The Audit Committee reviewed the Annualreport. TheAuditCommitteediscussedandagreed thewording for thegoingconcernandviability the impactof uncorrected misstatements, deferred taxation anduseof Alternative Performance Measures (APM) in including revenue recognition, theadoptionof IFRS16, systemcontrol procedures around manualjournalentries, management representation letter; 1 05 Mar r at the AGM, remuneration, independence,andtheprovision of non-audit services;and oversee ther k eview andrecommend tothe Board thefinancialstatements andassociated announcements. 4 March 2019–toapprove the2018AnnualReport;approve the2019preliminary results andreview theKPMGLLP eep underreview theGroup’s reporting andinternalcontrol policiesandprocedures; ch 2019–toreview the 2018 auditandapprove theauditors’report; review specificaccountingissues elationship with the external auditors including their appointment, subject to approval by shareholders elationship withtheexternalauditorsincludingtheirappointment,subjecttoapproval byshareholders eview thefull2019auditstrategy; insurancestrategy, taxstrategy, riskprocess, treasury policy tional, financial, compliance tional, financial,compliance

Corporate governance 71 72 incident andthematter wasbeing handledanddisclosedappropriately. a paperprepared bytheexecutives onthematter which provided comfort totheDirectors that thiswas anisolated The Audit Committee considered the contingentliability referred to in Note 36 to the financial statements and reviewed information relating tothismatter duetotheveryrecent timingof this issuebeingidentified. Group. TheGroup hasbeenincommunication with thethird partybut isnotyetinapositiontoverifyorvalidate any performed on behalf of a customerin 2018 and2019 which potentiallycould give rise to a material claim against the Subsequent toyearendtheGroup identifiedanissue regarding anaspect of certainprocess developmentwork Estimate andjudgments:Potentiallitigation that thepercentage of completionof fixed price commercial development revenues tobeappropriately accounted for. Having provided appropriate challengetomanagementandtheexternalauditor, theAuditCommitteehasconcluded position andfound thepercentage of completiontobe appropriately accountedfor. methods used in calculating the percentage of completion, as well as performing detailedtestingof the year end The Group’s externalauditorhasreported totheAuditCommitteethat they have reviewed theassumptions and these are finalisedpriorto release of theyearendorinterim results. of calculation of thisestimate isflaggedtotheAuditCommitteewith regular updates beingprovided untilsuchtimeas nature, reasoning behindandriskof misstatement of thisaccountingestimate. Anysignificantchangetothemethod Upon identification of thisjudgmentalissuemanagementprovided totheAuditCommitteeadetailedupdate onthe 10 percentage pointshigherorlower, revenue recognised intheperiodwouldhave been£540,000 higherorlower. the work packages which remain in progress at year end is £5,447,000. If the assessed percentage of completion was development work package. The value of the revenue recognised and the related contract asset raised with regards to such require judgementintermsof theassessmentof thecorrect percentage of completionfor that specificprocess fixed priceprocess developmentworkpackages. Revenuesare recognised onapercentage of completionbasisandas As itsatisfies itsperformance obligations theGroup recognises revenue andthe related contractassetwith regards to Percentage of completionof fixed priceprocess development revenues that the percentage of completionof bioprocessing revenues tobeappropriately accountedfor. Having provided appropriate challengetomanagement andtheexternalauditor, theAuditCommitteehasconcluded position, andfound thepercentage of completiontobeappropriately accountedfor. methods used in calculating the percentage of completion, as well as performing detailedtestingof the year end The Group’s externalauditorhasreported totheAuditCommitteethat theyhave reviewed theassumptionsand these are finalisedpriorto release of theyearendorinterim results. of calculation of thisestimate isflaggedtotheAuditCommitteewith regular updates beingprovided untilsuchtimeas nature, reasoning behind, andriskof misstatement of thisaccountingestimate. Anysignificantchangetothemethod Upon identification of thisjudgmentalissuemanagementprovided totheAuditCommitteeadetailedupdate onthe points higherorlower, revenue recognised intheperiodwouldhave been£2,863,000 higherorlower. batches whichremain inprogress at yearendis£20,863,000. Iftheassessedpercentage of completionwas10percentage batch. Thevalueof therevenue recognised andtherelated contractassetraisedwithregards tothebioprocessing assessment of thecorrect stageof completionincludingtheexpectedcostsof completionfor that specificbioprocessing process. Revenues are recognised onapercentage of completionbasisandassuchrequire judgementintermsof the as theprocesses are carriedout.Progress isdeterminedbasedontheachievementof verifiablestages of thebioprocessing Bioprocessing of clinical/commercial product for partnersisrecognised onapercentage of completionbasisovertime Percentage of completionof bioprocessing batch revenues due totheimpactof COVID-19 aswellturbulenceinthefinancialmarkets. was not deemed by KPMG LLP to be a significant risk in 2019, whilst going concern was identified as being significant estimate andgoingconcern.Duetoquantumvalueof newcustomercontractssigned,contractrevenue recognition completion of bioprocessing andfixed pricecommercial development revenues, thebioprocessing out of specification The issuesconsidered bytheAuditCommitteethat are deemedtobesignificanttheGroup are thepercentage of Significant issues Corporate governancereport Corporate governance Oxford Biomedica plc|Annual report andaccounts2019 Oxford Biomedica plc|Annual report andaccounts2019 the outof specification estimate tobe appropriately accounted for. Having provided appropriate challengetomanagementandtheexternalauditor, theCommitteehasconcludedthat and found theoutof specification estimate tobeappropriately accounted for. preparing theoutof specification estimate, aswellperforming detailedtesting of thehistoricinputstocalculation, The Group’s externalauditorhasreported totheAuditCommitteethat they have reviewed theassumptionsusedin release of theyearendorinterimresults. is flaggedtotheAuditCommitteewith to regular updates beingprovided until suchtimeastheseare finalisedprior nature, reasoning behind, and risk of misstatement of this accounting estimate. Any significant changeto thisestimate Upon identification of thisjudgmentalissuemanagementprovided to theAuditCommitteeadetailedupdate onthe lower dependingonthenumberof bioprocessing batches actuallygoing outof specification infuture. bioprocessing process at yearend.Thisestimate, basedonthehistoricalpercentage, maybesignificantlyhigheror batches produced across theassessedperiodtorevenue recognised onbatches whichhave notyetcompletedthe specification batches across thelast four years,andhasappliedthepercentage of out of specification batches tototal which theproduct isbioprocessed. Incalculating thisestimate theGroup haslooked at historicalrates of outof recognised andwhichmaybereversed shouldtheproduct gooutof specification duringthe remaining periodover Group hasassessedtheneedtoincludeanestimate of bioprocessed product for whichrevenue haspreviously been As theGroup hasnowbeenbioprocessing product across anumberof years,andalsoinacommercial capacity, the as theprocesses are carriedout.Progress isdeterminedbasedontheachievementof verifiablestages of theprocess. Bioprocessing of clinical/commercial product for partnersisrecognised onapercentage of completionbasisovertime Provision for outof specification bioprocessing batches appropriate for thefinancialstatements tobeprepared onagoingconcernbasis. concern status andfuture viabilityof theGroup tobeappropriately reflected intheGroup’s disclosures andthat itis and future viabilityof theGroup, aswellperforming detailedtestingof thecashflow forecast and found thegoing The Group’s externalAuditor hasreported totheAuditCommitteethat theyhave reviewed thegoingconcernstatus in theDirectors Reportonpage96. The Board concludedonthegoingconcernstatus andfuture viabilityof the business, theoutcomeof whichisdetailed a material uncertaintywhichisfurtherexplainedinthegoingconcernnoteonpage96. that the goingconcernstatus andfuture viabilityof theGroup hasbeenappropriately assessed,althoughitdoesnote Having provided appropriate challengetomanagement andtheexternalauditor, theAuditCommitteehasconcluded years) considered withintheGroup’s viabilitystatement. represent thegreatest potentialfinancialimpactintheshorttermandoverlonger(currently assessedasthree downside risks were tooccur. Thiswastostress testanaggregation of theworstscenariooccurringthat would further potentialdownsiderisks tothisforecast, aswellthemitigating actionswhichcould berequired ifthese the impactof theriskcurrently facingthebusinessunderCOVID-19 pandemic.TheAuditCommitteealsoconsidered financial statements. Inthepreparation of thedownsidescenariodetailedcashflow forecast, managementassessed The Group hasconsidered theimpactof COVID-19 ontheadoptionof thegoingconcernbasisof preparation inthese specific sensitivitiesare stress tested,andlongrangeplanprepared bymanagement. based onadetailedcashflow forecast, takingintoconsideration bothabasecaseanddownsidescenariowhere future viability of theGroup whichisassessed bytheAuditCommitteeasasub-committeeof theBoard. Thepaperis At year-end, managementprovides totheAuditCommitteeanaccountingpaperongoingconcernstatus and concern status of theGroup. Management andtheDirectors have hadtomake estimates andimportantjudgementswhenassessingthegoing Going concern

Corporate governance 73 74 changes have beensuccessfully implementedviaanexternallygenerated questionnaire willoccur during2020. based ontherecommendations of thereport. Areview of the2019performance inrelation towhethertheappropriate The independentreport wasreceived inthe firstquarter of 2019andtheBoard isimplementingappropriate changes all aspectsof aBoard’s performance, aninterviewwitheach Director andanactiveobservation of aBoard meeting. The Board review process comprisedthecompletionbyeachDirector of a comprehensive questionnaire covering Directors Remuneration matters andontaxbuthasnoconnectionwith individualDirectors. conducted anindependentreview of theBoard’s performance for 2018/2019. Deloitteprovides advicetotheGroup on In accordance withthe 2018 Corporate GovernanceCode,betweenDecember2018andFebruary2019, DeloitteLLP Board evaluation Non-Executive Director whowilloverseeengagementbetween theBoard andtheworkforce. In compliance with the 2018 Corporate Governance Code, Stuart Henderson was appointed as the nominated Directors isinprogress. non-compliant. The Board recognised the issue at that time and a search for additional independent Non-Executive However, withtheappointment of RobertGhenchevasaNon-Executive Director inJune2019, theBoard became the Board, excluding theChair, comprisedof Non-Executive Directors whomtheBoard considered tobeindependent. During thefirsthalf of theyearBoard wasfullycompliantwiththe2018Corporate GovernanceCodeinthat half of Robert GhenchevasaNon-Executive Director memberof Board. The Nomination Committeemetseveraltimesin2019onanadhocbasiswithonemeetingheldtoconsiderappointment the Board andsuccessionplanning,comprisesallof theindependentNon-Executive Directors. The Nomination Committee,whichischaired bytheGroup’s Chairman,leadstheprocess for makingappointmentsto Nomination Committeereport throughout theorganisation. of improved processes andcontrols, andanincreased awareness, emphasisandconsideration of control matters significant impactontheUK,buttocontinueseekimprove itinternalcontrol environment through theimplementation The Group planstomaintainitslevelof internalcontrol duringtheperiodinwhichCOVID-19 pandemichasa monitoring of remote usagehasbeenincreased asaprecaution. from users’owndevices.Nomajorchangeswere required toenablethesignificantshift remote usage.Proactive successfully. TheGroup already hadextensiveremote workingfacilitiesinplaceincludingfunctionallylimitedaccess ensure adequate availability of supporting documentation during the payment process, but this has been implemented control environment. Thebusinessdidhave toimplementsomechangesthesign-off process for bankpaymentsto internal controls implementedbythebusinessare systembased,thischangehasnothadadetrimentalimpactonthe As a result of COVID-19, the Group has implemented extensive working from home byitsemployees.As most of the COVID-19 Financial Officer. Thefinancial results arealso reviewedbytheSenior Executive TeamandtheBoard. and externallyreported financialstatements are subjecttothorough review bytheGroup FinancialController andChief orders, payroll anddisbursements,anorganisation of thefinancefunctionsuchthat monthlymanagement results processes includeclearseparation of dutieswithinthefinancialprocesses suchasapproval of invoices,purchase The mainfeatures of theinternalcontrol andriskmanagementprocesses whichapplytotheGroup’s financial reporting the growth andthecomplexityof thebusiness. certain internalfunctionswillbeoutsourced in2020andthat thefinancefunctionwillbefurtherstrengthened to reflect Controller andwasfurtherreviewed at theOctober2019AuditCommitteemeeting,where itwasdeterminedthat controls and riskmanagement.The review for 2019 was prepared by the Chief FinancialOfficer and the Group Financial reviews the effectiveness of allsignificantaspects ofinternalcontrol, includingfinancial,operational andcompliance provide reasonable, andnotabsolute,assuranceagainstmaterial misstatement orloss.TheAuditCommitteeannually system isdesignedtomanage,rather thaneliminate, theriskof failure toachievebusinessobjectives,andcanonly The Directors are responsible for Oxford Biomedica’ssystemof internalcontrol andfor reviewing itseffectiveness. The Internal control Corporate governancereport Corporate governance Oxford Biomedica plc|Annual report andaccounts2019

Oxford Biomedica plc|Annual report andaccounts2019 The information abouttheshare capitalrequired bytheTakeover Directive isinthe Directors’ report onpage95. Share capital Diversity. Thisisbeingtaken intoaccountinfuture successionplanningactivities. will hopefullybe met during2020/2021. The Board is aware of the recommendations of the Parker Review onEthnic on thesebothat Board andtheSeniorExecutive Team level,sothat theobjectivesof theHampton-Alexander Review than males and as such the Group met the 33% requirement. As a Group, its strategy will be to maintain and improve equal male/female splitat theHeadof Departmentlevelandat theSeniorManagementlevel there are more females the genderpaygapreport, (for thefullreport seeourwebsitewww.oxb.com) theGroup isprogressing towards an Executive Team, excluding theExecutive Directors, totalledeight,of whichthere are twofemale members.In2019in range of skills,expertiseandethnicsocietalbackgrounds. Intermsof thenextlevelof management,theSenior Oxford Biomedicabelievesthat membersof theBoard andseniormanagementshouldcollectivelypossessadiverse Non-Executive Director’s which,of course,willtake diversityinto consideration whenappointing. principles assuch.TheBoard is,therefore, aware of thisissue andiscurrently lookingtoappointtwonewindependent 350 Board bewomen.Even thoughOxford BiomedicaplcisnotaFTSE350company, theGroup likes toadhere tothe one womanandsevenmentherefore doesnotmeettheHampton-Alexander recommendation that 33%of aFTSE The Group supports the principles of the Hampton-Alexander report on gender. At present, the Board is comprised of diversity withnorestrictions onage,gender, religion, ethnicbackground whosecompetencieswillenhance theBoard. and makes recommendations basedonthecapabilitiesof individual candidates, having dueregard for thebenefits of The Nomination Committeehasaformal andrigorous appointmentprocess involvingmostifnotallBoard members the rightmixof skills,experience,independence,knowledgeandconsideration of theGroup’s strategic objectives. on merittakingintoaccountsuitabilityfor therole, compositionandbalanceof theBoard toensure that theGroup has to achieveadiverseBoard and,justasimportantly, diversemanagementteams.AppointmentstotheBoard are based enable ittoattract andretain themosttalentedpeoplefrom allbackgrounds andcultures. TheGroup isalsoworking workforce. Oxford Biomedica aimstocreate aninclusiveworkingenvironment basedonmerit,fairnessandrespect to The Group recognises theimportanceof diversityandiscommittedtoencouragingequalityamongits Diversity found asuitableindependentNon-Executive Director toreplace him,or, inanycase,by31December2020. Remuneration Committee.Inaddition,Andrew Heath hasinformed theBoard of hisdecisiontoretire oncetheGroup has Committee. Heather Preston willreplace Andrew Heath astheSeniorIndependentNon-Executive Director andChairof the and accordingly hewillstepdownastheSeniorIndependentNon-Executive Director andChairof theRemuneration Following Andrew Heath’s proposed re-appointment at the upcoming AGM, he will no longer be deemed to be independent Directors. Inaddition,theBoard hasinitiated asearch for anewChairfollowing Lorenzo Tallarigo’s decisiontoretire. the 2018Corporate GovernanceCoderecommendation that halftheBoard shouldconsistof independentNon-Executive development of the Board. TheBoard have initiated a search for additional independent Non-Executive Directors toaddress The Board hasreviewed thesuccessionplansfor bothitscompositionandthat of itscommitteesandthecontinued Board successionplanning

Corporate governance 75 76 provided onpage79withregards tohowperformance undertheannualbonustargets translated intobonus payment. bonus of 90%of salary. Thebonuseswillbepaid50%incashanddeferred share awards. Further detailsare appropriate andaccordingly approved theaward toJohnDawsonof abonusof 88%of salaryandtoStuart Payntera concluded theoverallbonuspaymentsearnedby reference totheannualbonusperformance measures tobe Committee considered overallbusinessperformance aspartof itsassessmentof theannualbonusout-turnand performance againstcorporate objectivesissetoutonpage81of thisremuneration report. TheRemuneration The performance of thebusiness in2019issetoutdetailtheStrategic report from pages15to55andthe bonus award for 2019. In February2020theRemuneration Committeemettoconsidertheachievementof 2019objectivesandtheannual 2019 businessperformanceandincentiveimpact seeking shareholder approval for anewpolicyat the2021AGM. Group’s strategy andappropriately takes accountof corporate governanceupdates sinceitsadoption,inadvanceof During 2020theRemuneration Committeewillreview thepolicytoensure itremains fit for purpose,linked tothe accounts, whichisavailable at www.oxb.com. The fullpolicyasapproved byshareholders at the2018AGM is includedintheCompany’s2017Annualreport and policy intheDirectors’ remuneration report, wehave includedthosepartswethinkshareholders willfindmost useful. a newpolicywillnotbesoughtat the2020AGM. Although therelevant regulations donotrequire ustoincludethe The Remuneration Committeeconsidersthat thepolicyremains appropriate and,accordingly shareholder approval for The policy at the 2018AGM withover97%of thevotescastinfavour of it. the annualreport onremuneration followed byextractsfrom ourDirectors’ remuneration policy(“thepolicy”)approved I ampleasedtointroduce ourremuneration report for the2019financialyear. The report isdividedintotwosections: Dear Shareholder Annual statementfromtheRemuneration Committeechair from thechairof theRemuneration Committeeandthepolicyreport are notsubjecttoaudit. accordance withtherelevant regulations. Thepartsof thereport that are subjecttoauditare indicated. Thestatement Remuneration Report and to state whether, intheiropinion,those parts of the report have beenproperly prepared in The CompaniesAct2006requires theauditorstoreport totheshareholders oncertainpartsof theDirectors’ 2020 AGM. The annualstatement andtheAnnualreport onremuneration are subjecttoanadvisoryvoteat theCompany’s — — — Large andMedium-sized CompaniesandGroups (AccountsandReports)Regulations 2008. Thereport contains: This report is on the activities of the Remuneration Committee. It is prepared in accordance with Schedule 8 to the Introduction Directors’ remunerationreport Corporate governance Oxford Biomedica plc|Annual report andaccounts2019

binding effect from theclose of that meeting. extracts fr between Companyperformance andremuneration for the 2019 financialyear;and the annualr the annualsta om theDirectors’ remuneration policy (the“policy”),whichwasapproved at the2018AGM, andtook eport on remuneration showing payments and awards made to the Directors and explaining the link eport onremuneration showingpaymentsandawards madetotheDirectors andexplainingthelink tement from theRemuneration Committeechair;

Between 15%and25% 15% (i.e.52.1%over3years) Less than15% Oxford Biomedica plc|Annual report andaccounts2019 Chair, Remuneration Committee Dr. AndrewHeath please visitourwebsiteat www.oxb.com. the organisation and that this has had a positive impact on the Group’s gender paygap.Forfulldetailsof the report growth of theGroup overtheyearandprogression towards anequalmale/female splitat themore seniorlevelsof The Remuneration Committeereviewed theGroup’s GenderPayGapReport for 2019andwaspleasedtoseethe Executive Directors withthat for thewiderworkforce. regard totheprovisions of the2018Corporate GovernanceCoderelating tothealignmentof pensionprovision for consideration of thenewpolicywewillalsoconsiderourapproach toincumbentExecutive Directors’ pension, having for any newly appointed Executive Director will be aligned with that available to the wider workforce, and as part of our new policy to be proposed to shareholders at the 2021 AGM. The new policy will also confirm that pension provision post-employment shareholding guideline).Thosechangeswillcontinuetoapplyin2020, andwillbeenshrinedinthe to theLTIP, enhancementof recovery provisions, anincrease toourshareholding guidelineandtheintroduction of a we implementthepolicyhaving regard tothe2018Corporate GovernanceCode(theintroduction of aholding period The Remuneration Committeereported lastyearthat wewouldintroduce anumberof changestothewayinwhich will beinvitedtoapprove the2019Directors’ remuneration report at the2020AGM. that the 2018Directors’ remuneration report received votesinfavour inexcess of 94%at the2019AGM. Shareholders The Remuneration Committeerecognises theexpectations of ourshareholders onexecutive payandwewere pleased Other matters Information onthewayinwhichGroup willimplementthepolicyin2020issetoutonpage89. Implementation ofourpolicyin2020 appropriate. Clawback andmalusprovisions willapplytotheawards. Remuneration Committee reviewed performance against this underpin and concluded the overall LTIP payments to be Remuneration Committeeconsidered that theoverallperformance of thebusinessacross theperiodjustified it.The The awards were alsosubjecttoaperformance underpin, suchthat the awards wouldonlyvesttotheextentthat the of theassessmentperiod.Detailsare provided onpage83. The 2016LTIP awards vestedduring2019. Theshare pricewasaveraged across the20businessdayspriortoend with thedateofgrant growth overthethreeyearperiodstarting Average annualcompoundshareprice 274.7p (after adjustmentfor the50to1share consolidation inMay2018);thevestingconditionswere asfollows: LTIP awards were grantedon16May2016toJohnDawson,PeterNolan and TimWatts whentheshare pricewas Vesting ofthe2016LTIP award 25% ormore (i.e.95.3% over3years)

Calcula 25% 0% will vest options grantedthat Percentage ofthe 100% ted onastraightlinebasisbetween25%and100%

Corporate governance 77 78 — — — — During 2019theRemuneration Committeemet8times.Themainactivitiesanddecisionswere asfollows: Remuneration Committeeactivitiesduring2019 2019) andStuart Henderson.OtherDirectors are invitedtoattend meetingsonanagendadrivenbasis. The Remuneration Committeemembersare currently Andrew Heath (Chairman),Heather Preston (appointed12March — — — — — Group’s website andinclude: The responsibilities of theRemuneration Committeeare setoutinitstermsof reference whichare available onthe Remuneration Committeeroleandmembers Directors’ remunerationreport Corporate governance Oxford Biomedica plc|Annual report andaccounts2019

Annual report. whether there shouldbesalaryincreases for 2019. Theoutcomeof thesediscussionswasreported inthe2018 Executive Directors inrespect of 2018inlightof the performance against the Group’s 2018objectives, and also under theCompany’sSave AsYou Earnscheme. 11 SeptembertheRemunera of the grant. granted in2016, 2017and2018. DBPoptionsvestinthree equalinstalmentsonthefirst,secondandthird anniversaries included onpage83. TheRemuneration Committeealsoapproved thevestingof Deferred BonusPlan(DBP)options performance underpin.Theoutcomewasthat 100%of theoptionsgrantedin2016wouldvest,more information is for theMay2016LTIP grantof optionshadbeenmetandwhether vestingwasappropriate byreference tothe 16 May2019–theRemunera Long Term IncentivePlan,Deferred BonusPlanandEmployeeShare OptionScheme. 18 April2019–theRemunera 18 appr Executive Team), andawards grantedundertheplan;and appr appr appr management (SeniorExecutive Team). Theremuneration of theNon-Executive Directors isamatter for theChairman; r ecommending totheBoard thepolicyandframeworkfor theremuneration of theExecutive Directors andsenior February 2019 – the Remuneration Committee considered whether or not bonuses should be paid to the February 2019 – the Remuneration Committee considered whether or not bonuses should be paid to the oval of optionsgrantedtoallemployeesundertheGroup’s share optionplan. oval of theGroup’s LongTerm IncentivePlan(LTIP) for Executive Directors andseniormanagement(Senior oval of annualperformance incentiveplansandbonusespayable; oval of individualremuneration packages for Executive Directors andtheSeniorExecutive Team; tion Committee approved an invitation to all employees to participate in the 2019 offer tion Committeeapproved aninvitation toallemployeesparticipate inthe2019offer tion Committee considered the extent to which the share price performance conditions tion Committeeconsidered theextenttowhichshare priceperformance conditions tion Committee considered the granting of options to employees under the Group’s tion Committeeconsidered thegrantingof optionstoemployeesundertheGroup’s Oxford Biomedica plc|Annual report andaccounts2019 Director isnotentitledtoacquire thevestedshares untiltheendof theholdingperiod. period. Awards willvestfollowing the endof theperformance periodbutwillnotbereleased, sothat theExecutive As withthe2019awards, theawards willbesubject toatwoyearholdingperiodfollowing theendof theperformance in performance. Share pricegrowth willalsobeaveraged across athree monthperiodtoavoid rewarding for shorttermspikes that the Remuneration Committeeconsidersthat theoverallperformance of thebusinessacross theperiodjustifiesit. vesting) remains appropriate. There willbeaperformance underpin,suchthat theawards willonlyvesttotheextent maximum vesting)andrevenue growth (requiring 15%CAGR for threshold vestingand24% or greater for maximum equally weightedbetweenshare pricegrowth (requiring 10%CAGR for threshold vestingand17.5% CAGR orgreater for growth of the business the Remuneration Committee believes that making the awards subject to performance measures salary in the case of the CEO and100% in the case of the CFO. As with the awards granted in 2019, recognising the The Remuneration Committeehasagreed that theExecutive Directors willbegrantedLTIP awards of upto125%of LTIP are basedontheCompany’sstrategic priorities,andfurtherinformation isgivenonpage81. the lightof performance againstthoseobjectivesandinlinewiththeremuneration policy. Theperformance measures Executive Directors’ bonusesfor 2020are earnedwillbedeterminedbytheRemuneration Committeeearlyin2021 the opportunityfor 2019. Performance objectivesfor theGroup have beenagreed bythe Board andtheextenttowhich The maximumannualbonusopportunityfor theGroup’ Executive Directors willremain upto125%of salaryinlinewith Annual bonus reward Programme. granted thewiderworkforce onaverage a9%increase insalaryfor 2020duetotheimplementation of theGroup’s the Remuneration Committeedecidedfor 2020toaward a5%increase insalary. TheRemuneration Committee for Stuart Paynterovertwotothree yearperiodsubjecttocompanyandindividualperformance. Asaconsequence, Committee wouldlooktoincrease thesalariestoachieveabasesalaryof £450,000 for JohnDawsonand£260,000 companies of similarsize andcomplexity. The2018Directors’ remuneration report indicated that theRemuneration The Remuneration Committeerecognises that thesalariesfor theCEO andCFOare significantlybelowmarket for Committee hascarriedoutthisreview inFebruary2020andhasawarded thefollowing basesalaryincreases: Under theremuneration policyExecutive Directors’ basesalariesare normallyreviewed annually. TheRemuneration ofchangestoexecutive remunerationfor2020 Summary Annual reportonremuneration John Dawson Stuart Paynter urn aayPretg nraeTotal ofincrease Percentageincrease Current salary £228,000 £410,000 5.0% 5.0% £20,500 £11,400 New salary £430,500 £239,400

Corporate governance 79 80 Peter Nolan John Dawson John Dawson 2019 The following tablesshowasingletotalfigure of remuneration for 2019 for eachDirector andcomparative. (audited) Single totalfigureofremuneration Directors’ remunerationreport Corporate governance Oxford Biomedica plc|Annual report andaccounts2019 2018 4 pages 15to55. annual bonusaward for 2019. Theperformance of thebusiness2019issetoutindetailStrategic report from In February2020theRemuneration Committeemetto consider theachievementof the2019objectivesand 3 and theamountthat isattributable tothegrowth inshare priceto1,000p at vesting. The following tablesetsouttheamountof thevalueattributable totheshare priceat thegrantof theawards (450p) the decisiontoaward theoptionstorelevant Directors bytheRemuneration Committee. and theamountthat isattributable tothegrowth inshare priceto690pat vesting.Nodiscretion hasbeenexercised in The following tablesetsouttheamountof thevalueattributable to the share priceat thegrantof theawards (274.7p) 2 1 John Dawson John Dawson 5 Total Stuart Paynter Stuart Paynter Total Peter Nolan Benefits comprisemedicalinsuranceandthepr Peter Nolansteppeddownfr of vesting(1,000p). Directors’ Remuneration Report.Thevaluesare calculated byreference totheshare priceat thelastdayof theperiodoverwhichshare pricewasawarded todeterminetheextent This comprisestheL The valuesare calculated byreference totheshare priceat thelastdayof theperiodoverwhichshare pricewasaveraged todeterminetheextentof vesting(690.0p). This comprisestheL Pension contributionsar John Dawsonhadelectedtoreceive suchacashallowance. 5 TIP awards grantedin2015whichvestedJune2018. Therelevant performance criteriaandtheperformance againstthemare setoutonpage77of the2018 TIP awards grantedin2016whichvestedon16May2019. Therelevant performance criteriaandthe performance againstthemare setoutonpage83. e madeintotheGroup’s definedcontributionscheme,or at theelection of theDirector, asacashallowanceinlieu of acompanypensioncontribution– om theBoard on1July2018. His2018remuneration isinrespect of theperiodtohisretirement from theBoard, including his 2018bonus. ovision of acarallowance. Salary Salary Salary Salary £’000 £’000 638 702 380 228 108 410 214

T T otal value otal value Benefits £438,240 £386,228 £268,169 Benefits Benefits £’000 £’000 22 11 11 9 4 4 1 1

Value attributabletoshare Value attributabletoshare Bonus Bonus Bonus Bonus £’000 £’000 price atgrantof274.7p 564 439 205 817 price atgrantof450p 359 251 127

£120,676 £197,208 £153,763 £’000 £’000 LTIP LTIP 386 706 268 438 386 - - 2 3

share priceto690.0p atvesting share priceto1,000p atvesting V V alue attributable to growth in alue attributabletogrowthin alue attributable to growth in alue attributabletogrowthin Pension Pension £’000 £’000 98 86 50 54 32 32 16 4 4

£232,465 £241,032 £147,493 £’000 £’000 1,696 2,332

Total Total 1,220 1,311 520 476 501

Oxford Biomedica plc|Annual report andaccounts2019 Performance againsttheGroup objectivesfor 2019, onwhichtheExecutives Directors’ bonusesare based,wasasfollows: within budget. manufacturing facilityontimeand Centre andcompletethenew of thenewWindrushInnovation Group innovates withthecreation Group’s future successthat the that, itisfundamentaltothe and Sanofi (Bioverativ). Asideto Novartis, Orchard Therapeutics them andreach key milestonesfor Group’s customersasagreed with The key here istoservicethe Advancement Partners / Capacity / Technology Objective favourable terms. refinancing theloanonmore along withextinguishingor and aproduct out-licensingdeal include newmanufacturingdeals targets. Assumptionsinthebudget achieve revenue andEBITDA innovation centre. creation of thenewdiscovery/ the Group innovates withthe programmes anditisessentialthat organisational effectiveness future. Thegoalistoenhanceour productive workforce for the to ensure abalancedand benefits andstaff supportsystems a culture, competitiverewards/ field, itisessentialtheGroup builds competition for key staff inthe the Group, togetherwith studies. deals andstarttwofeasibility one product, agree three platform deals. Theplanwastoout-licence budget wastocompletenew in clinicaldevelopment. value totheGroup, moveforward which have beenseenbringgreat products suchasAXO-Lenti-PD, competition. Valuable pipeline essential tokeep usaheadof the Group’s platform. Thesegoalsare with data driveninnovations inthe new patentable inventions)along portfolio, alongsidetechnical(two products intotheGroup’s Advance twonewplatform and innovation With therapidpaceo Organisational development A criticalsuccessfactorf Business development The financialobjectivessetar Financial objectives Patent / product advancement f growth for f growth for or the or the e to e to

Weighting 25% 15% 10% 30% 20% was achieved,however(5%). (10%). Thegoalof signingtwonewfeasibility studies were signed(NovartisandSanten)bytheendof 2019 manufacturing deal. not completingaproduct out-licensingdealoralarge or thecashin-flowasperbudget(0%).Thiswasdueto our revenue andEBITDA target asperthebudget(0%) which wasanobjective(5%).TheGroup didnotachieve clinical developmentintocohort2(5%). partially met(2.5%).Axo-Lenti-PD hasmovedforward in Microsoft collaboration isunderwayandhasonlybeen platform process (5%).Digitaladvancementviathe along withtwonewpotentialinventionsfiled for through proof of concept topre-clinical studies(5%), was achievedontime(5%). addition, thehandoverandcommissioningof Oxbox successful progression of theCFprogramme (2.5%).In Therapeutics programme asagreed (5%),alongwith (5%). TheGroup hadalsoprogressed theOrchard (5%) andexpandedtheportfolio of products withthem innovation hubwasalsoestablished(5%). Innovation Centre, whichistheGroup’s discovery/ management (2.5%).Thecreation of theWindrush management developmentprogramme andtalent include annualperformance management, effectiveness programmes were also rolled outto structures andbenefits(2.5%).TheGroup’s organisation Performance assessed with theconversiontoasuspensionpr The Group hadachievedkey milestonesfor Novartis Gr Overall thefinancialobjectiveswere notmet.The communica The Reward strategy wassuccessfullydevelopedand (0%). Ofthethr The plantoout-licenceoneproduct wasnotachieved pr The Group hadstrengthened thepipelinewithtwonew ogrammes OXB-203 andOXB-302 progressing oup didmanagetoextinguishtheloan,however, ted to include competitive grading and pay ted toincludecompetitivegradingandpay ee platform technology deals only two ee platform technologydealsonlytwo oduction process oduction process Partially met Partially met Mainly met Mainly met Met infull against objective Assessment

15% 5% 17.5% 22.5% 10% % of bonus awarded

Corporate governance 81 82 Aggregate Directors’emoluments and MartinDigglehave electedtoreceive nofees for theirservicesasDirectors. Robert GhenchevwasappointedasaNon-Executive Director witheffect from 24 June2019. BothRobertGhenchev Fees The singletotalfigures of remuneration for Non-Executive Directors are showninthetablebelow: concluded theoverallbonuspaymentstobeappropriate. anniversary of theaward. TheRemuneration Committeereviewed performance againsttheannualbonusout-turnand first three anniversarydates after theaward date provided that the relevant participant remains employed at thefirst The deferred share awards are notsubjecttofurtherperformance targets andwillvestinthree equalinstalmentsonthe The bonuseswillbepaid50%incashanddeferred share awards. — — Accordingly, bonusesearnedbytheExecutive Directors inrespect of 2019were: his personalobjectives,andbasedonachievementsagainstthoseawarded abonusequalto20%of salary. The Remuneration Committeeundertookarobust assessmentof theachievementsof Stuart Paynterwithrespect to business developmentactivities. the debt,optimisingfinancialstrategy for theGroup andenhancingthefinancialfunction ofthe Group tosupport so are not fullydisclosedbelow. However, theprincipalareas of thepersonalobjectiveswere related toclearanceof by theGroup tobecommercially sensitive,astheywillgivetheGroup’s competitorsinsightintoitsstrategic plans,and objectives andtargets whichsupportedthestrategic objectivesof thebusiness.Theobjectivesandtargets are considered The personalelementof thebonusfor Stuart Paynterwasassessedbyreference totheachievementof clearpersonal Paynter is80%linked tocorporate objectivesand20%linked topersonalobjectives. John Dawson’sbonusisentirely (100%)linked totheachievementof thecorporate objectives.Thebonusfor Stuart Directors’ remunerationreport Corporate governance Oxford Biomedica plc|Annual report andaccounts2019 Salaries Lor Benefits Andrew Heath Pension / cash alterna Stuart Henderson LTIP Heather Preston Bonuses Total Non-Executive Directors fees Total

enzo Tallarigo S John Dawson:£359 tuart Paynter:£205,000 (90%of salary). tive ,000 (88%of salary);and £’000 £’000 2,041 2019 2019 564 638 386 345 345 150 86 65 22 65 65 £’000 £’000 2,664 2018 2018 706 702 332 332 150 817 98 65 65 52 9 Between 15%and25% 15% (i.e.52.1%over3years) Less than15% 25% ormore (i.e.95.3% over3years) Oxford Biomedica plc|Annual report andaccounts2019 (Stuart Paynter)of salarydividedbytheaverage share priceof 704.6p inthefivebusinessdayspreceding theaward. The numberof optionsawarded inApril2019wascalculated byreference to125%(JohnDawson)and100% 274.7p (after adjustmentfor the50to1share consolidation inMay2018),thevestingconditionswere asfollows: LTIP awards were grantedon16May2016toJohnDawson,PeterNolan and TimWatts whentheshare pricewas (audited) LTIPs vestingduring2019 On 18April2019, theExecutive Directors were awarded thefollowing optionsundertheGroup’s LTIP scheme: (audited) LTIPs awarded during2019 2 Thevaluesare calculated byreference totheshare priceof 690ponthelastdayof theaveraging period. 1 Numberof shares post30May2018share consolidation. John Dawson The valueof theawards vestingduring2019are detailedbelow: appropriate. Clawback andmalusprovisions willapplytotheawards. Remuneration Committee reviewed performance against this underpin and concluded the overall LTIP payments to be Remuneration Committee considersthat the overallperformance of thebusinessacross theperiodjustifiesit.The The awards were alsosubjecttoaperformance underpin, suchthat theywouldvestonlytotheextentthat the The outcomewasthat 100%of theoptionsgrantedin2016vested. price growth was35.8%. of theassessmentperiod.Overthree yearperformance periodfrom thedate of grant,theannualcompoundshare The 2016LTIP awards vestedduring2019. Theshare pricewasaveraged across the20businessdayspriortoend the threeyearperiodstartingwithdateofgrant Average annualcompoundsharepricegrowthover John Dawson Peter Nolan Tim Watts Stuart Paynter

granted thatvested Number of awards Number ofawards 34,589 23,949 55,975

1 Calcula on whichthesharesvest Share price at the date Share priceatthedate Percentage oftheoptionsgrantedthatwillvest ted onastraightlinebasisbetween25%and100% options granted Number of Number of 32,358 72, 690p 690p 690p 736

Value ofawards on F ace value ace value £228,000 £386,228 £238,664 £512,500 £165,248 vesting of grant 100% 25% 0%

Corporate governance 83 84 Stuart Paynter John Dawson Ex Robert Ghenchev Heather Preston Stuart Henderson Andrew Heath 2 1 Includestheinterest of Vulpes Life ScienceFund, Vulpes Testudo Fund andotherpartiesconnectedtoMartinDiggle. Martin Diggle Lorenzo Tallarigo Non-Executive Directors The interests inshares of theDirectors whoservedduringtheyearasat 31December2019were asfollows: with Stuart Paynterworkingtowards meetingthisguideline. prevailing closing share price on 31 December 2019). Under this criteria John Dawson meets the shareholding guideline, The valueof theshares asat 31December2019hasbeendeterminedbasedonashare price of 645p(beingthe shareholding equivalentto200%of basesalarywitheffect from 1January2019. The Remuneration Committeehasadoptedashareholdinga guidelinefor theExecutive Directors, whichspecifies (audited) Statement ofDirectors’shareholdingandshareinterests performance conditions),theycannotbeexercised untiltheendof afurtherholdingperiodof twoyears. Although the awards will vest following the assessment of the performance period (subject to satisfaction of the Committee considersthat theoverallperformance of thebusinessacross theperiodjustifiesit. There will also beaperformance underpin,suchthat the awards willonly vest tothe extent that the Remuneration 2 1 starting withthedateofgrant over thethreeyearperiod of thecompany’sshareprice Compound annualgrowthrate revenue measure: the performance conditions setout below, whichare weighted equallybetween the share price measure and the The awards are nilcostoptionsandare subjecttoathree yearvestingperiod.Theyare subjecttotheachievementof Directors’ remunerationreport Corporate governance Oxford Biomedica plc|Annual report andaccounts2019 Between 10%and17 10% (i.e.33%over3years) Less than10% 17.5% ormore (i.e.63%over3years) The endshare priceshallbecalculated astheaverage of theclosingpricefor thethree monthsperiodpriorto18April2022. The startingshar Calcula Robert GhenchevisHeadof NovoGrowth at NovoHoldingswhichhasaholdingof 7,750,000 shares. Robert GhenchevwasappointedtotheBoar ecutive Directors ted bycomparingtheauditedrevenue figure as of 31December2018 of £66.8m withtheaudited revenue figure as of31December2021. 1 e priceis704.6, beingtheaverage share priceoverthefivebusinessdayspreceding thedate of grant. 2 .5%

d asaNon-Executive Director witheffect from 24 June2019. measure thatwillvest subject totheshareprice Percentage oftheoptions 25% 0% 100% between 25%and100% Calculated onastraightlinebasis 1686011,640,177 11,668,640 Shares heldoutright 50036,000 55,000 8488,6 9,1 8,6 2024,5 8,6 172,006 188,765 45,455 52,002 289,668 394,516 88,468 88,468 28147,942 52,891 ,7 1,753 6,770 0921 0921 0921 092018 2019 2018 2019 2018 2019 2018 2019 ,2 6,677 7,925 – – – –

unexercised options between 2018and202 of thecompany’srevenue Compound annualgrowthrate 15% (i.e.52.1%over3years) Less than15% 24% ormore (i.e.90.7% over3years) Between 15%and24% – V ested but

–

1 073434111088,762 121,120 4,354 20,723 2 Unvested deferred

bonus plan 25% 0% measure thatwillvest subject totherevenue Percentage oftheoptions 100% between 25%and100% Calculated onastraightlinebasis performance conditions Unvested LTIP awards

subject to

Stuart Paynter Oxford Biomedica plc|Annual report andaccounts2019 During 2019thefollowing optionshave vestedandlapsed: formally enshriningitinthenextpolicy. appropriate circumstances andwillcontinuetoreview theguidelineinlightof developingmarket practicebefore has purchased. TheRemuneration Committeeretains discretion tovarythepost-cessation shareholding guidelinein of shares, heorshemustretain theshares held.Theguidelinedoesnotapplytoshares whichtheExecutive Director to 100%of basesalaryfor twoyearsfollowing cessation. IftheExecutive Director holdsfewer than therequired number shareholding guideline.Thisrequires that anExecutive Director mustretain shares withavalue(asat cessation) equal Reflecting bestpractice,theRemuneration Committeehasadopted,witheffect from 1January2019, apost-cessation which is disclosed on page 83. which isdisclosedonpage83. As previously disclosed,TimWatts andPeterNolanretained thebenefit of their LTIPs granted in2016, the vesting of (audited) Payment topastDirectorsandpaymentsforlossofoffice Between 10%and20% 10% (i.e.33%over3years) Less than10% starting withthedateofgrant growth overthethreeyearperiod Average annualcompoundshareprice with thedifference reflecting theawards having been grantedondifferent dates.Thevestingconditions areas follows: granted toStuart Paynterinrespect of 2017are subjecttoashare pricegrowth target byreference toapriceof 430.2p, John Dawsoninrespect of 2017are subjecttoashare pricegrowth target byreference toapriceof 496.5p andtheawards In 2020theperformance criteriafor theLTIP awards grantedinrespect of 2017willbeassessed.Theawards grantedto During 2019JohnDawsonandStuart Paynterdidnotexercise anyoptions. John Dawson Deferred bonus Stuart Paynter John Dawson LTIP 20% ormore (i.e.73%over3years)

1 January 2019 1 January Unvested at Unvested at 172,006 88,762 Calcula 25% 0% that willvest Percentage oftheoptionsgranted 100%

ted onastraightlinebasisbetween25%and100% 1 January 2019 1 January during 2019 Unvested at Unvested at V esting esting 45,455 55,975 4,354 –

during 2019 during 2019

V Lapsed 24,632 esting esting 1,451 – –

during 2019 during 2019 A Awarded Awarded warded warded 32,358 72,736 17,820 31,179

31 December2019 31 December2019 Unvested at Unvested at U nvested at nvested at 188,767 121,120 52,002 20,723

Corporate governance 85 86 Year 1 Theincrease inbenefitsisduetothefullyearimpact of theprovision of acarallowance. those employeesotherthantheCEO whowere employedthroughout thewhole of both2018and2019. significant changesin headcountnumbers,the Remuneration Committeehaschosenasthe comparator group all compares withtheequivalentchangesinthosecomponentsfor agroup of employees.As2018and 2019have seen The tablebelowshowshowthepercentage changeintheCEO’s salary, benefitsandbonusbetween20182019 Percentage changeinCEO’sremuneration of remuneration Year CEO’s remunerationinlasttenyears the US(NASDAQ Biotech)market, provide furtherbenchmarks that are more specificcomparators. index and NASDAQ Biotechindex, comprising biotech companieseither in the UK (FTSEtechMARK MediScience) or in because itrepresents abroad-based measure of investment return from equities.TheFTSEtechMARKMediScience FTSE techMARK MediScience indexand the NASDAQ Biotech index. TheFTSEall-share indexhas been selected The chartbelowillustrates theCompany’sTSRperformance since January2010relative totheFTSEall-share index,the Performance graphandcomparisonwithCEO’sremuneration Directors’ remunerationreport Corporate governance Oxford Biomedica plc|Annual report andaccounts2019 (£’000) employee group Comparator (£’000) John Dawson L CEO’s total single figure CEO’s totalsinglefigure Annual bonus 400 600 200 300 500 100 TIP vesting 0 Dec 10 Key:

FTSE all-share index Oxford Biomedicaplc

Dec 11

% o % o

0519,573 10,521 092018 2019

1 380 410 f maximum f maximum Dec 12 £’000 Salary

NASDAQ Biotechindex FTSE techMARKmediscienceindex 0021 0221 0421 0621 082019 2018 2017 2016 2015 2014 2013 2012 2011 2010 2 %1%3%7%4%5%8%9%70% 92% 85% 50% 42% 75% 30% 17% 0% 42% 5 1 0 6 8 3 5 1 ,1 1,220 1,311 811 653 732 680 468 401 413 450 %0 0 %0 0%5%2%8%100% 80% 25% 50% 100% 0% 0% 40% 0% 0% Dec 13 % increase 9.9 7.9 Dec 14 092018 2019 244 11 Benefits Dec 15 1 114 114 4 % increase Dec 16 175 1 Dec 17 092018 2019 5 439 359 7 1,084 978 Bonus Dec 18 % decrease Dec 19 10 18 Oxford Biomedica plc|Annual report andaccounts2019 investment of thebusinessinitspeople.Thekey cashmeasure amountswere identifiedasbeing: employee remuneration asafundamentalelementof operational spendandouractivities,aswellthecontinued The Group’s key cashmeasures were chosenbytheDirectors becausetheyillustrate veryclearlytheimportanceof Since theGroup doesnotmake dividendorotherdistributions, thesehave notbeenincludedinthetable. The chartbelowillustrates thespendonemployeeremuneration compared withtheGroup’s key cashmeasures. Relative importanceofspendonpay 2019 2018 Pay detailsfor theindividualsare setoutbelow: Financial year the medianpayratio tobeconsistentwiththeGroup’s widerpoliciesonemployeepay, reward andprogression. success of theGroup andtoapplythispolicyfairlyconsistentlyattract andmotivate staff. TheGroup considers The Group aimstoprovide acompetitiveremuneration package whichisappropriate topromote thelong-term participate intheShare OptionSchemeortheLTIP. Certainemployeesalso participate indiscretionary bonusschemes. respectively. Employees’involvementin the Group’s performance isencouraged,withallemployeeseligibleto ratios were calculated usingthefulltimeequivalentremuneration for allUKemployeesasat theendof 2018and2019 methodology for theratios wasconsidered tobethemostaccurate method.The25th,median and75thpercentile pay The Group usedOptionAasdefinedinTheCompanies(MiscellaneousReporting)Regulations 2018, asthiscalculation The tablebelowsetsouttheCEO payratio at the25th,medianand75thpercentile employeewithintheorganisation. CEO’s payratio Salary (£’000) Salary (£’000) 2018 £m Total remuneration (£’000) Total remuneration (£’000) 2019 -10 40 60 20 30 50 70 10 0 Staff pay CEO CEO Method £410 £380 Option A £1,220 £1,311 Option A Non-payroll costs Cash generated from / (used in) Cash generated from /(usedin) 25th percentile 25th percentile Medianpayratio 25th percentile payratio £26 £25 1:48 £29 £27 1:42 operations Net cashburn Median Median £35 £32 1:37 £38 £35 1:32 Cash revenues 75th percentile 75th percentile 75th percentile payratio £45 £44 1:27 £50 £48 1:24

2019 2018 2017

Corporate governance 87 88 Resolution At the2018AGM, theDirectors’ remuneration policywasapproved byshareholders asfollows: * Thenumberof votesreflects that thevotetookplace after the50to1share consolidation inMay2018. Resolution At the2019AGM, the2018Directors’ remuneration report wasapproved byshareholders asfollows: Statement ofvotingatAGM Directors’ remunerationreport Corporate governance Oxford Biomedica plc|Annual report andaccounts2019 6 May2020 Chair, Remuneration Committee Dr. AndrewHeath satisfied that Deloittedoesnothave anysuchinterests orconnectionswiththeGroup that mayimpairindependence. The Remuneration Committeereviewed thepotentialconflicts of interest andthesafeguards againstthemandis and inrelation totheoperation of itsshare plansduring2019. received from DeloitteLLPwasboth objectiveandindependent.DeloittealsoadvisedtheGroup onBoard remuneration in theUK.Deloitte’sfees for advicetotheRemuneration Committeeduring2019were £5,400 plusVAT. Theadvice Remuneration ConsultantsGroup andadheres toitsCodeof Conductinrelation toexecutive remuneration consulting Deloitte LLPactedasadvisertotheRemuneration Committeeduring2019Deloitteisafounding memberof the Advisers totheRemuneration Committee Appr Appr remuneration report remuneration report oval of the Directors’ oval of theDirectors’ oval of theDirectors’ discretionary) discretionary) 1,930,039,150 24,818,930* (including (including (including V V otes for otes for otes for 48 1,365,178* 94.8% 72 56,288,698 97.2% % for % for

Votes against Votes against

% against % against .%19637888,903,541 1,986,327,848 2.8% .%26,184,108* 5.2%

(excluding votes (excluding votes (excluding votes (excluding votes T T otal votes cast otal votescast otal votes cast otal votescast withheld) withheld) Votes withheld Votes withheld (abstentions) (abstentions) 557*

Share ownership R Oxford Biomedica plc|Annual report andaccounts2019 calibre. executives of asuitable attract andretain to which issufficient To provide abasesalary Base salary Executive Directors Component andpurpose Policy table Directors’ remunerationpolicy performance. incentive for continued provide anongoing Shareholders and To alignExecutives with guidelines competitive basis. on amarket To provide benefits Benefits for retirement. To provide funding etirement benefits etirement benefits

to mark Base salariesare initiallysetbyreference outstanding vestingcriteriacount Shares whichare fullyownedwithno practice andmayincludemedical Benefits are provided inlinewithmarket contribution schemef The Group operates adefined guideline hasbeen satisfied. annual bonus,until theshare ownership plans, anddeferred shares underthe vest underthelong-termincentive retain halfof anypost-taxawards which Executive Directors willberequired to shares (onanetof taxbasis). together withdeferred annual bonus towards theshareholding guideline of thecontributionstoapensionplan. cash supplementinsteadof someorall Directors maybepermittedtotake a or lifetime allowance.Executive where contributionsexceed theannual In appropriate circumstances, suchas including Executive Directors. include, for example,travel expenses. individual circumstances. Thesemay benefits maybeprovided basedon Remuneration Committee.Additional appropriate benefitsdeterminedbythe car oraallowanceandother health insurance,provision of acompany insurance, life assurance,permanent − − − not limitedto): of factorswhichmayinclude(butare annually takingintoaccountanumber Base salariesare normallyreviewed the newDirector. the experienceandprevious package of appointment andtakingintoaccount − from 1January. Any changesar Operation

market forces; and performance; competitive salarylevelsand r underlying Gr the Group. and conditionselsewher ole, experience and individual ole, experienceandindividual et information at the time of et information at thetimeof e normally effective e normallyeffective oup performance; or all employees or allemployees e in e in

and maintain200%o Executive Directors are required tobuild 15% of basesalary. incr While there isnomaximumsalary, aiu oeta n amn ttrsodPerformancetargetsandmetrics Maximum potentialandpaymentatthreshold − − as, butnotlimitedto: awarded incertaincircumstances, such Salary increases abovethislevelmaybe employees intheGroup. percentage of salaryterms)toother level of salaryincrease awarded (in level of shareholding. the Remuneration Committee. appropriate. Remuneration Committeedeems over suchtimeperiodasthe Such increases maybeimplemented − − but thetotalsar There isnopredetermined maximum

salary withthemarket overtime); newly appointedExecutive Director’s performance inrole (e.g.toaligna and/or complexityof thebusiness. market practice;or in scopeorresponsibility; been promoted orhashadachange an individual’sdevelopmentor wher wher wher eases will normally be line with the eases willnormallybelinewiththe e there has been a change in size e there hasbeenachangeinsize e there has been a change in e there hasbeenachangein e anExecutive Director has e reviewed annually by e reviewed annuallyby f salary minimum f salaryminimum

Not applicable. Not applicable. Not applicable. apply While noformal performance conditions salary increase. is taken intoaccountindeterminingany , an individual’s performance in role , anindividual’sperformance inrole

Corporate governance 89 90 T Annual bonus a senseof ownership. the Group andpromote To create alignmentwith Sharesave Scheme Component andpurpose Directors’ remunerationreport Corporate governance Oxford Biomedica plc|Annual report andaccounts2019 before LTIP awards vest. challenging performance shares whilstrequiring longer terminterests in Executive Directors with alignment byproviding To augmentshareholder Plan (LTIP) Long Term Incentive interests. with shareholders’ the incentivepackage deferred shares aligns bonus paymentvia Delivery of 50%of any Group’s objectives. reward deliveryof the o incentivise and o incentiviseand participa Executive Directors are entitledto Committee, annualgrantso At thediscretion of theRemuneration 50% o Committee. Annual bonusesare determinedbythe table onthenextpage. summarised inthenotestopolicy Recovery provisions applyas HMRC EMIplanwhere appropriate. Awards have beenmadeunderan into shares onacumulative basis. assume thereinvestment of dividends delivered incashorshares andmay These dividendequivalentsmaybe between thegrantandvestingdate. include dividendequivalentsearned Awards grantedundertheLTIP may performance period. typically assessedoverathree year of specifiedperformance targets, which vestsubjecttotheachievement conditional nominalcostshare options summarised at thefoot of thistable. Recovery provisions applyas into shares onacumulative basis. assume thereinvestment of dividends be delivered incashorshares andmay period. Thesedividendequivalentsmay to thedeferred shares overthedeferral Dividend equivalentsmaybeattached Committee’s discretion. adjusted at theRemuneration discretionary andcanberemoved or appropriate. Bonusawards are under anHMRCEMIplanwhere Deferred share awards maybemade subject tofurtherperformance targets. award. Thedeferred shares are not second andthird anniversariesof the three equalinstalmentsonthefirst, deferred shares whichordinarily vestin 50% of thebonusisdelivered through applicable legislation from timetotime). discount asmaybepermittedbythe value of shares at grant(orsuchother discount of upto20%themarket an optionpricewhichcanbeat a option overtheCompany’sshares with five yearslinked tothegrant of an contributions overaperiodof three or which theymaymake monthlysavings employee Sharesave Schemeunder Operation f thebonusisdelivered ascash. te in a tax qualifying all te inataxqualifyingall f f

base salaryinr The normalmaximumaward is100%of not ex The maximumbonusopportunitywill aiu oeta n amn ttrsodPerformancetargetsandmetrics Maximum potentialandpaymentatthreshold tax authoritiesfrom timetotime. exercise priceare thosesetbytheUK recruitment of anExecutive Director. exceptional circumstances suchasthe award limitwillonlybeexceeded in base salary. Thenormalmaximum respect of afinancialyearis200% of opportunity that maybegrantedin plan rulestheoverallmaximum 125% of basesalary. Undertheshare CEO for whomthemaximumaward is for Executive Directors, otherthanthe o Participation limitsandthelevel f discount permitted in setting the f discountpermittedinsettingthe ceed 125%of basesalary. espect of a financial year espect of afinancialyear decided annuallybytheRemunera The performance metricsandtargets are line withHMRCpractice. Not subjecttoperformance measures in determined inadvanceo Performance conditionswillbe threshold performance isnotmet. There isnominimumbonusearnedif significantly eachyear. objectives andmetricsmaychange Given thenature of thebusiness,these strategic needsof thebusiness. Committee takingintoaccountthe which themeasure hasbeenachieved. Committee’s assessmentof theextentto depending upontheRemuneration be determinedbetween0%and100% For strategic measures, vestingwill performance, noneof theaward willvest. performance; for belowthreshold 100% of theaward willvestfor maximum will vestfor threshold performance and measure, nomore than25%of theaward performance inrespect of afinancial measures. Fortheachievementof growth not limitedto)share priceandrevenue Financial measures mayinclude(butare or theachievementof strategic objectives. and willbebasedonfinancialmeasures f grant of awards f grantof awards tion tion Oxford Biomedica plc|Annual report andaccounts2019 and that amendmentisrequired sothat theyachievetheiroriginalpurpose. market conditions)whichcausetheRemuneration Committeetodeterminethat themeasures are nolongerappropriate (such asachangeinstrategy, amaterial acquisitionand/oradivestmentof aGroup business,orachangeinprevailing The Remuneration Committeeretains theabilitytoadjustorset different performance measures ifeventsoccur situation at thetime;awards tobe grantedin2019willbesubjecttomeasures basedonshare pricegrowth andrevenue. The performance metrics for theLTIP are determinedtoensure that themostappropriate targets are setfor theGroup’s generating recurring revenues suchasmanufacturingordevelopmentservices tothird parties. on thestageof developmentof eachopportunity. Theannualobjectivesare alsolikely toincludetargets related to out-licensing. Targets for aparticularyearare therefore likely toincludespecificproduct developmenttargets depending from pre-clinical proof of concept through to the end of Phase I or Phase II clinical studies before partnering or strategic needsof thebusiness.Akey componentof theGroup’s strategy istodevelopgeneandcelltherapyproducts Performance targets for theannualbonusare setbytheRemuneration Committeeafter takingintoaccountthe Performance targetsandmetrics — — — Clawback maybeappliedintheeventof: — — — — — Malus maybeappliedintheeventof: may require therepayment of someorallof theaward intherelevant circumstances (clawback). relevant circumstances (malus).Foruptotwoyearsfollowing thevestingof aLTIP award theRemuneration Committee The Remuneration Committee has the right to reduce, cancel or impose further conditions on unvested awards in the LTIP: shares in therelevant circumstances (clawback). instalment of deferred shares theRemuneration Committeemayrequire therepayment of someorallof thedeferred may becancelledorreduced intherelevant circumstances (malus).Foruptooneyearfollowing thevestingof thefirst repayment of someorallof thecashaward intherelevant circumstances (clawback).Unvesteddeferred bonusawards For uptotwoyearsfollowing thepaymentof anannualbonusaward theRemuneration Committeemayrequire the Annual bonus: The annualbonusandLTIP are subjecttomalusandclawbackprovisions asfollows: provisions Recovery Notes tothepolicytable

ma any applicableperformance conditions;or an err a ma ma serious r a ma any applicableperformance conditions; an err a ma terial misconductonthepartof theparticipant. terial misconductonthepartof theparticipant. terial misstatement of theGroup’s financial results; terial failure of riskmanagementbytheGroup; terial misstatement of theGroup’s financial results; or intheinformation orassumptionsonwhichtheaward wasgrantedorvestsincludinganerror inassessing or intheinformation orassumptionsonwhichtheaward wasgrantedorvestsincludinganerror inassessing eputational damagetotheGroup; or

Corporate governance 91 92 S John Dawson Lor Robert Ghenchev Heather Preston Stuart Henderson Andrew Heath Martin Diggle Service contracts Service The detailsof servicecontractsandlettersof appointmentof thosewhoservedasDirectors duringtheyearare: full noticeperiod. Directors mayberequired toworkduringthenoticeperiodorbepaidinlieuof noticeifnotrequired toworkfor the Executive Directors’ servicecontractsare subjectto12months’noticefrom boththeGroup andfrom theDirector. contractsandpolicyonpaymentforlossofoffice Service Group. Directors for theirservicestothe To compensate non-Executive Non-Executive Directors’fees Non-Executive Directors Component andpurpose restriction inanyterritoryprevented theCompanyfrom offering shares toanExecutive Director. the Remuneration Committeewouldonlyusethesecashprovisions for operational flexibility, for exampleifa regulatory number of shares, andthat share awards maybesettledincashat theelectionof theRemuneration Committee; be operated inaccordance withtheir terms, including that awards maybegrantedascashbasedawards overa notional accordance withtherulesof theShare OptionScheme,LTIP andDeferred BonusPlan.TheCompany’sshare plansmay Awards andoptionsmaybeadjustedintheeventof avariation of share capitalorotherrelevant amendmentin Operation ofshareplans Directors’ remunerationreport Corporate governance Oxford Biomedica plc|Annual report andaccounts2019 Letters ofappointment All Directors are subjecttore-election byshareholders onanannual basisinlinewiththe2018Corporate GovernanceCode. tuart Paynter enzo Tallarigo may beappropriate. travel costsorotherbenefitsthat the useof secretarial support, eligible toreceive benefitssuchas Non-Executive Directors maybe other Non-Executive Directors. Chairman’s fees are setbythe appointment of aDirector. The Chairman at thetimeof Operation determined bytheGr Non-Executive Directors’ fees are oup’s oup’s Date ofappointment f There isnooverallmaximum,but other times. Directors’ fees maybemadeat increases innon-Executive period of appointment.However, at thestartof eachthree year Fees wouldnormallybereviewed Board committee. responsibilities suchaschairinga supplementary fee for additional receive abasefee anda Non-Executive Directors may expected timecommitment. responsibilities of therole and at threshold Maximum potentialandpayment 10 October2008 ees are set taking into account the ees are settakingintoaccountthe 1 February2016 4 October2012 29 August2017 1 January2010 Contract date 15 March 2018 24 June2019 1 June2016

31 December2019 31 December2019 U U nexpired term at nexpired termat nexpired term at nexpired termat

Not applicable. Performance targetsandmetrics N/A N/A N/A N/A N/A N/A N/A N/A

Notice period Notice period 12 months 12 months 3 months 3 months 3 months 3 months 3 months 3 months

Oxford Biomedica plc|Annual report andaccounts2019 The principlesonwhichthedetermination of paymentsfor lossof office willbeapproached are setoutbelow: Other payments Change ofcontrol LTIP Deferred BonusPlan Annual Bonus Payment inlieuofnotice 6 May2020 Chair, Remuneration Committee Dr. AndrewHeath By order of theBoard Policy or employment. by wayof settlementorcompromise of anyclaimarisinginconnectionwiththetermination of a Director’s office in goodfaithdischarge of anexistinglegalobligation (orbywayof damages for breach of suchanobligation) or The Remuneration Committeeretains discretion tomake additionalexitpaymentswhere suchpaymentsare made In appropriate circumstances, paymentsmayalsobemadeinrespect of accruedholiday, outplacement andlegalfees. treatment for leavers oronachangeof control underthisscheme. which isgovernedbyitsrulesandthelegislation relating tosuchtaxqualifying plans.There isnodiscretionary Payments maybemadeeitherintheeventof alossof office orachange ofcontrol undertheSharesave Scheme, date of granttothedate of therelevant corporate eventrelative totheperformance period. is satisfied and,unlesstheRemuneration Committeedeterminesotherwise,theperiod of timeelapsedfrom the Committee willdeterminethelevelof vestingtakingintoaccounttheextenttowhichperformance condition Awards undertheLTIP willvestearlyonatakeover, merger orotherrelevant corporate event.TheRemuneration corporate event. Awards undertheDeferred BonusPlanwillvestinfulltheeventof atakeover, merger orotherrelevant accordance withtherulesof therelevant plan. The extenttowhichunvestedawards undertheDeferred BonusPlanandLTIP willvestbedeterminedin period astheRemuneration Committeedetermines. Committee determines.Awards whichhave already vestedat thedate of cessation maybeexercised for such relative totheperformance period.Awards maythenbeexercised duringsuchperiodastheRemuneration Committee determinesotherwise,theperiodof timeelapsedfrom thedate of granttothedate of cessation taking intoaccounttheextenttowhichperformance conditionissatisfied and,unlesstheRemuneration normal vestingdate. Ineithercase,theextentof vestingwillbedeterminedbytheRemuneration Committee Committee, theRemuneration Committeeshalldeterminewhethertheaward willvestat cessation orat the ill-health, injury, disability, thesaleof hisemployeroranyotherreason at thediscretion of theRemuneration Unvested awards willnormallylapseoncessation of employment. However, ifaparticipantleaves duetodeath, The extenttowhichanyunvestedaward willvest bedeterminedinaccordance withtherules of theLTIP. The extenttowhichanyunvestedawar earned for theyearof departure andpreceding yearincash. earlier inappropriate circumstances). TheRemuneration Committeehasdiscretion topaythewholeof anybonus performance, bepaidat theusualtime(althoughRemuneration Committeeretains discretion topaythebonus amounts paidwilltypicallybepro-rated for timeinserviceduringthebonusperiodandwill,subjectto the individual’sdeparture andtheircontributiontothebusinessduringbonusperiodinquestion.Any or nottoaward abonusinfullorpartwillbedependentonnumberof factors,includingthecircumstances of This willbea contributions andanyapplicablesalarysupplement)for thenoticeperiod. Contractual termination paymentsmaynotexceed theDirector’s current salaryandbenefits(includingpension may beexercised for suchperiodastheRemuneration Committeedetermines. period astheRemuneration Committeedetermines.Awards whichhave already vestedat thedate of cessation the date of granttothedate of cessation relative tothedeferral period.Awards maythenbeexercised duringsuch taking intoaccount,unlesstheRemuneration Committeedeterminesotherwise,theperiodof timeelapsedfrom normal vestingdate. Ineithercase,theextentof vestingwillbedeterminedbytheRemuneration Committee, Committee, theRemuneration Committeeshalldeterminewhethertheaward willvestat cessation orat the ill-health, injury, disability, thesaleof hisemployeroranyotherreason, at thediscretion of theRemuneration Unvested awards willnormallylapseoncessation of employment.However, ifaparticipantleaves duetodeath, Bonus Plan. t the discretion of the Remuneration Committee on an individual basis and the decision as to whether t thediscretion of theRemuneration Committeeonanindividualbasisandthedecisionastowhether d will vest will be determined in accordance with the rules of the Deferred d willvestbedeterminedinaccordance withtherulesof theDeferred

Corporate governance 93 94 another personapproved bytheotherDirectors asanalternate Director. than sixmonths;orbyrequest inwritingbyalltheotherDirectors. Any Director mayappointanotherDirector or bankruptcy; ifheorsheissuffering from specifiedmentaldisorders; ifheorsheisabsentwithoutconsent formore ordinary resolution at ageneralmeeting; ifheorsheisprohibited bylawfrom beingaDirector; intheeventof retire at eachAGM andmayoffer themselves for re-election. ADirector may be removed inthe following ways:byan re-election. Inorder toensure that theCompany complieswiththe2018Corporate GovernanceCodeallDirectors will the existingDirectors, provided that anyDirector soappointedshallretire at thenextAGM andmayoffer himself for Directors maybeappointedbyanordinary resolution at anygeneral meetingof shareholders, ormaybeappointedby Appointment andreplacementofDirectors Company at 31December2019are disclosedintheDirectors’ remuneration report onpages76to93. subject toatwelvemonths’noticeperiod.TheDirectors’ remuneration andtheirinterests intheshare capitalof the statements are detailedonpages64and65page34. Thecontractsof employmentof theExecutive Directors are Details of theDirectors of theCompanywhowere inoffice duringtheyearandupto date ofsigningthefinancial Directors The Directors donotrecommend paymentof adividend(2018:£nil). Dividends (note 3:financialriskmanagement). The Group’s exposure torisks issetoutonpages58to62(principalrisks anduncertainties)onpage125 Risk management The Group’s statement oncorporate governanceisincludedintheCorporate governancereport onpages57to100. Corporate governance Key financialperformance indicators are outlinedintheChiefFinancialOfficer’s reviewonpages38to 47. Key financialperformanceindicators(KPIs) this judgement. six timesfor routine meetingsin2019theDirectors consider that theyare sufficientlywell informed tobeablemake 2019 audit,andthefullBoard reviewed thecontentsof thereport at its24 March 2020meeting.SincetheBoard met Audit Committeeinitiallydiscussedtherequirements withtheGroup’s auditorswhendiscussingthestrategy for the Annual report andaccounts,taken asawhole,are fair, balancedandunderstandable.Inreaching thisconclusion,the The Strategic report includingtheoutlookfor 2020onpage33, isonpages15to55. TheDirectors considerthat the Strategic report or impliedinsuchforward lookingstatements. business performance andresults of theGroup maydiffer materially from theplans,goalsandexpectations expressed the control of theGroup andCompany. Readersare cautionedthat, asaresult, theactualfuture financialcondition, looking statements involveriskanduncertaintybecausetheyrelate tofuture eventsandcircumstances that are beyond future financial condition,businessperformance and results of theGroup andCompany. Bytheirnature, all forward contain forward-looking statements withrespect tocertain of theplans,current goalsandexpectations relating tothe governance report onpages57to100. Discussionsregarding financialinformation containedinthisAnnual report may 31 December2019assetoutonpages110to150. Thisreport shouldberead inconjunctionwiththeCorporate The Directors present theirAnnualreport andauditedconsolidated financialstatements for theyear ended for theyearended31December2019 Directors’ report Corporate governance Oxford Biomedica plc|Annual report andaccounts2019

Oxford Biomedica plc|Annual report andaccounts2019 No personholdsshares carryingspecialrightswithregard tocontrol of theCompany. No otherpersonhasreported aninterest intheordinary shares of theCompanyrequired tobenotifiedtheCompany. Vulpes InvestmentManagement Shareholder the following shareholdings amountingto3%ormore of theordinary share capitalof theCompany. At 15 April2020, thelatest practicaldate prior toapproval of theDirectors’ report, theCompany hadbeennotified of Substantial shareholdings to buybackshares. rights overupto6,616,184 shares, being10%of theshares theninissue.Norightshave beengrantedtotheDirectors 22,053,954 shares, solelyinarightsissue.Authoritywasalsogiven,subjecttocertainconditions,waivepre-emption normal pre-emption rightsreserved toshareholders containedintheCompaniesAct2006, andtoallotupafurther 22,053,954 shares (that numberbeingonethird of totalissuedshare capitalof theCompanyat thetime),subjectto the conclusionof thenextAGM ifsooner. At thelastAGM heldon29May2019, authoritywasgiventoallotup Each yearat theAGM theDirectors seekrightstoallotshares. Theauthority, whengrantedlastsfor 15monthsoruntil Rights toissueandbuybackshares of shares intheCompanyoronvotingrights.Allshares are admittedtotradingontheLondonStock Exchange. the Companyhad76,859,131 ordinary shares inissue,allallottedandfullypaid.There are norestrictions onthetransfer ordinary shares of 50penceeach(eachcarryingonevoteandrankingequallywithother).At 31December2019 On 30May2018, Oxford Biomedicaconsolidated itsexistingordinary shares of 1penceeachintonewconsolidated Structure oftheCompany’scapital Share capital Directors. Thiswasinforce throughout 2019anduptothedate of approval of thefinancialstatements. The Group maintainsaqualifyingthird partyindemnityinsurancepolicytoprovide coverfor legalactionagainstits Directors’ thirdpartyindemnityprovision M&G Investments Novo Holdings Hargreaves LansdownPLC Mr. S M HShah Liontrust AssetManagement Aviva plc Interactive InvestorTrading Oaktree CapitalManagement Number of ordinary shares Number ofordinary 11,668,640 11,563,240 2,992,000 7,750,000 2,425,544 2,501,993 3,243,825 2,314,054 2,372,412 Percentage ofissuedsharecapital 15.0% 10.1% 15.1% 3.0% 4.2% 3.9% 3.2% 3.3% 3.1%

Corporate governance 95 96 customers andreduction inmilestones),areduction inassociated costs andlowerdiscretionary capitalexpenditure. assumptions includeareduction in revenues byalmost30%(fewer newcustomer, lowerdemand from existing flow forecasts includetheGroup’s current assumptions,takingintoaccount thesevere butplausibledownsides.The Whilst itisdifficulttoestimate theimpact of COVID-19 duetotherapidlychanging nature ofthepandemic,cash customer contractsfor process development andbioprocessing services. delivered orsecuringthebenefit of anyupfront receipts from licensingouttheGroup’s intellectualproperty orwinnew known andexpectedrevenues from existingcustomersunderlongterm contracts,whichare ongoingbutstilltobe these financialstatements iftheGroup couldnotsecure theexternalfinancing andcontinueto execute and recover identified that theGroup wouldnotbeabletocontinueitsactivities for at least12monthsfrom thedate of approval of review of thedetailedcashflow forecast prepared aspart of the goingconcernassessmentprocess. Theprocess to raisefundinginlinewiththeoriginallyplannedtimeline. Therefore, theBoard hasundertaken amuchmore rigorous of equitytotheinvestmentcommunityasplannedhasbecome verydifficultandthe Group hasnothadtheopportunity Due tovolatility inthefinancialmarkets created bytheimpact of the COVID-19 pandemic,fundraisingthrough issuance initiatives inorder tocontinueitsoperations andcurrent capabilities. Group requires additionalfinancinginthe form of equityfinancing,loanfinancingorothergovernment finance customers. DuetotheGroup’s scale-upof investmentsandstrategic decisiontoincrease it’sbioprocessing facility, the scenarios incorporating underperformance againstthebusinessplan,unexpected cashout assessed identi In assessing the going concern assumptions,the Board has undertaken a rigorous assessment of theforecasts and strategic decisiontoincrease itsbioprocessing capacity. flow, thiswaslargely duetooperational scale-up of investmentsinits people andoperational capabilitiesaspart of the Although in2019theGroup recorded anoperating lossof £14.5 millionanddidnotgenerate positive operational cash The Group held£16.2 millionand£17.2 millionof cashat theendof December2019andApril2020respectively. notes tothesefinancialstatements. The financialposition of theGroup, itscashflowsandliquidityposition are describedintheprimarystatements and Going concern office forDirectors oremployeesintheevent ofatakeover bid. agreements that theDirectors considerare material. There are noagreements providing for compensation for lossof Agreements that take effect, alter, orterminate because of atakeover bidoronchange of control. There are nosuch information. shares onwhichalltherelated optionshave vested.Seenote25of theconsolidated financialstatements for further to Executive Directors andotherseniormanagersunderthe2013Deferred BonusPlan.TheEBTcurrently holds116,724 The Group hasestablishedanEmployeeBenefit to hold shares purchased inorderTrust (EBT) tosettleshares awarded Employee shareschemes responsible businessstatement onpages48to54. Further detailsonemployees,healthandsafety, environmental matters andcorporate socialresponsibility are inthe The Group doesallthat ispracticabletomeetitsresponsibility towards theemploymentandtrainingof disabledpeople. of eachindividualtotheappropriate job,andtoprovide equalopportunityregardless of sex,religion orethnicorigin. The Group’s aimfor allmembersof staff andapplicants for employmentistofitthequalifications, aptitudeandability currently participate in discretionary bonus schemes but in the future all employees will be eligible for the bonus scheme. encouraged, withallemployeeseligibletoparticipate intheGroup’s share optionschemeortheLTIP. Certainemployees views of theworkforce andtooverseeemployeeengagement.Employees’involvementintheGroup’s performance is throughout theyear. Inaddition,theGroup hasdesignated Non-Executive Director, Stuart Henderson,for gathering the In accordance withs172of theCompaniesAct2006, theGroup communicates andconsultsregularly withemployees Employees for theyearended31December2019 Directors’ report Corporate governance Oxford Biomedica plc|Annual report andaccounts2019 fi ed downside risks and mitigating actions. The downside risks include a number of severe but plausible ed downsiderisks andmitigating actions.Thedownsiderisks includeanumberof severe butplausible fl ows and fewer new ows andfewer new continue togrow andwillbesufficienttosupportasustainable Group. its technologytothird parties andfrom providing process developmentandbioprocessing servicestoitspartnerswill the Directors believethat oncetheshorttermfundingconstraints have beenovercome, that revenues from licensing concern assessment on page 96 which looks at the 12-month period from date of signature of the accounts. However, predominantly by the current difficulties in accessing the capital markets, as isset out in further detail in thegoing companies. TheGroup isexpectedtobesignificantlyimpacted overtheshorttermby COVID-19 pandemic, upfront receipts androyalties, andfrom fees for providing process developmentandbioprocessing servicestoother Group wasgenerating growing revenues andotheroperating incomefrom licensingitsplatform technology, generating and tosupportthedevelopmentof othercompanies’products. Priortotheoutbreak of theCOVID-19 pandemic,the — Oxford Biomedica plc|Annual report andaccounts2019 The Group’s strategy istoexploititsLentiVector has beeninformed bythestrategy adoptedbytheBoard in2016andtheevolutionof thebusinesssincethat time. within andbeyondthistimehorizon giventhenature of thebusinesssectorinwhichGroup operates. Theassessment 31 December2022.Theybelievethree yearstobeappropriate duetotheinherent significantuncertainties of forecasting their prospects for aperiod,basedontheirassessment,of three yearscoveringtheperiodfrom 1January 2020to In accordance with the 2018 UK Corporate Governance code, the Directors have performed a robust assessment over Assessment ofprospects Viability Statement the Group’s contingencyplanningisprovided onpage62. landscape intheUK,Group hasassessedthefuture impactof Brexit onitsoperations tobeminor. Further detailsof Although theUK’sdecisiontoleave theEuropean Unionmaysignificantly affect thefiscal,monetaryand regulatory Therefore theDirectors have continuedtoadoptthegoingconcernbasisof preparation inthefinancialstatements. — — — — going concernbasisfor thefollowing reasons: However, despitetheaboveuncertainties,Board a has theconfidence that theaccounts shouldbeprepared on circumstances, itmaytherefore beunabletorealise itsassetsanddischarge itsliabilitiesinthenormalcourseof business. or conditionsthat maycastsigni The abovesituation givesrisetoamaterial uncertainty, asde it wouldnotbeabletogenerate sufficientcashflowstosupportitslevel ofactivitiesbeyondthe third quarter of2020. If theGroup isunabletothesecure theexternalfinancingand receipt the revenues describedabove,ithasassessedthat oup’s abilitytocontinuebesuccessfulinwinningnewcustomersandbuildingitsbrandasdemonstrated by:

the Gr the Gr the Gr external debtfinanceas required, the — — customer basethroughout thelockdown period. the Gr signingthesubstantiallicense,manufacturinganddevelopmentagr a potentialvaccinecandidate for COVID-19, withGovernmentsupportfor thefundingof theproject expected. joining aConsortiumledbytheJennerInstitute,Oxf Group’s ability to potentially access the Government Coronavirus Business Interruption Loan Scheme and also Group’s abilityto potentially access the GovernmentCoronavirus BusinessInterruption Loan Scheme and also oup’s abilitytocontrol capitalexpenditure costsandlowerotheroperational spend,asnecessary. oup’s historyof beingabletoaccesscapitalmarkets and, oup haskey worker status whichallowscontinuityof providing servicestotheGroup’s financiallystable fi cant doubt on the entity’s ability to continue as a going concern and in such cant doubtontheentity’sabilitytocontinueasagoingconcernandinsuch ® platform to develop gene and cell therapy products in its own portfolio platform todevelopgeneandcelltherapyproducts initsownportfolio ord University, torapidlydevelop,scale-up andmanufacture fi ned in auditing and accounting standards, related to events ned inauditingandaccountingstandards, related toevents eement withJuno(BMS)inMarch 2020,

Corporate governance 97 98 Group wouldneedtoagainsecure alternative sources of financingtocontinuefunditsoperations. third quarter2020, andoverthelongerterm,ineventrevenues were tofallbelowtheDirector’s expectations, the term as outlined inthe going concern assessment on page 96 the Group will needto raise funds before the end of the operation andmeetitsliabilitiesastheyfalldueoverthethree-year periodtoDecember2022.However, overtheshort concluded that there isareasonable expectation, althoughnotacertainty, that theGroup willbeabletocontinuein activity overthelongerterm.TheGroup’s financial forecasts reflect theseassumptionsandtherefore theDirectors have customer programmes, and in doing so ultimately being abletocontinuetheGroup’s recent growth in customer The Directors anticipate that theGroup hasstrong prospects for attracting andfulfillingthedemandsfrom more the numberof customerproducts’ increase, theriskfrom individualproduct setbacks reduces. (Hemophilia), UKCFGTC/Boehringer (Cystic Fibrosis), SantenandOrchard alsoremains importanttotheGroup, butas Novartis commercial supplyagreement. Theprogression of othermajorcustomerprogrammes suchasSanofi conducting feasibility studies,aswellotherpotentialnewcustomers,andbysecuringa5-yearextensiontothe risks byexpandinganddeepeningitscustomerbasee.g.theadditionof Juno(BMS)andothernewcustomersalready internal R&D projects can be managed in line withrevenues, andthe Group continues its efforts to mitigate itsfinancial have amaterially negative impactontheGroup. However, toalarge degree thecurrent investmentsinfacilities and importance duetothelarge milestonesreceivable underthetermsof ourcollaboration, whichifnotachievedwould and developitsownproducts e.g.OXB-302. Inparticular, thesuccessfuldevelopmentof Axo-Lenti PDisof significant spend, facilityexpansioncommitmentsandtheadditionalinvestmentsrequired inR&Dtomaintainitsleadingposition Over thelongerterm,itisimportantfor theGroup tobeablegenerate sufficient revenuestocoveritsoperational required toallowitcontinueitsoperations andultimately toachieveitslongtermgrowth ambitions. customer base),andwiththesupportof itslargest shareholders, that itwillbeabletoaccesstheadditionalcapital industry, itsexpandingcustomerbase(underpinnedbylongtermcontractsandaresilient andfinanciallystable short term.TheGroup ishoweverconfident that withitsleadingpositioninthefastgrowing cellandgenetherapy slowdown andstrictisolation measures withintheUKwillimpactGroup’s revenue generating capabilitiesoverthe the Group’s bioprocessing andprocess developmentservicesisnotcurrently impacted,aprotracted economic ability toaccessthecapitalmarkets (refer goingconcernassessmentonpage96for furtherdetail).Whilstdemandfor into sharpfocus bytheCOVID-19 pandemicwhichhascauseddisruptioninthemarkets andimpactedtheGroup’s investments required tocontinueitsgrowth strategy. Intermsof theshorttermoutlookof theGroup, thisriskisbrought unable toaccessthecapitalmarkets toobtainthenecessaryfundingrequired tomake theoperational andcapital The main area of risk to the viability of the Group within the three-year period to December 2022 is the Group being Assessment ofviability for theyearended31December2019 Directors’ report Corporate governance Oxford Biomedica plc|Annual report andaccounts2019 Oxford Biomedica plc|Annual report andaccounts2019 differ from legislation inotherjurisdictions. the Company’swebsite.Legislation intheUKgoverning preparation anddissemination of financialstatements may The Directors are responsible for themaintenance andintegrityof thecorporate andfinancialinformation includedon Directors’ remuneration report andCorporate governancereport that complieswiththat lawandthose regulations. Under applicablelawandregulations, theDirectors are alsoresponsible for preparing aStrategic report, Directors’ report, irregularities. steps asare reasonably opentothemsafeguard theassetsof theGroup andtoprevent anddetectfraudother that are free from material misstatement, whetherduetofraudorerror, andhave generalresponsibility for takingsuch responsible for suchinternalcontrol asthey determineisnecessarytoenablethepreparation of financialstatements Company andenablethemtoensure that itsfinancialstatements comply withtheCompaniesAct2006. Theyare parent Company’s transactions and disclose with reasonable accuracy at any time the financial position of the parent The Directors are responsible for keeping adequate accountingrecords that are sufficienttoshowandexplainthe — — — — — preparing eachof theGroup andparent Companyfinancialstatements, theDirectors are required to: true andfairviewof thestate of affairs of theGroup andparentIn Companyand of theirprofit orloss forthat period. Under company law the Directors must not approve a the financialstatements unless theyare satisfied that theygive elected toprepare theparent Companyfinancial statements onthesamebasis. Reporting Standards as adopted by the European Union (IFRSs as adopted by the EU) and applicable law and have Under that lawtheyare required toprepare the Group financialstatements inaccordance withInternational Financial Company lawrequires theDirectors toprepare Group andparent Companyfinancialstatements for eachfinancialyear. in accordance withapplicablelawandregulations. The Directors are responsible for preparing theAnnualreport andtheGroup andparent Companyfinancialstatements Statement ofDirectors’responsibilitiesinrespecttheannualreportandfinancialstatements LR 9.8.4 (7)and(8) LR 9.8.4 (5)and(6) Listing Rule following are applicable. The Directors have reviewed therequirements of LR9.8.4R. Themajorityof thesedonotapplytotheGroup butthe Compliance withListingRule 9.8.4R Amendment of theCompany’sarticlesof association maybemadebyspecialresolution at ageneralmeetingof shareholders. Amendment oftheCompany’sarticlesassociation

or to cease operations, or have no realistic alternative but to do so. or toceaseoperations, orhave norealistic alternative buttodoso. use thegoingconcernbasiso related togoing concern;and assess theGr sta mak select suitableaccountingpoliciesandthenapplythemconsistently; te whethertheyhave beenprepared inaccordance withIFRSsasadoptedbytheEU; e judgementsandestimates that are reasonable, relevant andreliable; oup and parent Company’s ability to continue as a going concern, disclosing, as applicable, matters oup andparent Company’s abilitytocontinueasagoingconcern,disclosing,applicable,matters to holdings. existing shareholders inproportion Allotment of shares otherthanto future emoluments. Director haswaivedcurrent or Arrangement underwhicha Information required f accounting unless they either intend to liquidate the Group or the parent Company f accountingunlesstheyeitherintendtoliquidate theGroup ortheparent Company share schemes(note27, page 141). Allotment of shares onexercise of optionsbyemployeesunderapproved services asDirectors (page82). Martin DiggleandRobertGhenchevhave electedtoreceive nofees for their Response

Corporate governance 99 100 6 May2020 Chief FinancialOfficer Stuart Paynter By order of theBoard encourages shareholders toattend theAGM bywebcast andvotebyproxy. The AGM willbeheldat 3p.m.onTuesday 23June2020at ourWindrushCourtlaboratories andoffices butthe Group Annual GeneralMeeting Details ongreenhouse gasemissionsare setoutintheResponsiblebusinesssectionof theStrategic report onpage52. Greenhouse gasemissionsreport reappointment willbeproposed at theAGM. The auditors,KPMGLLP, have indicated theirwillingnesstocontinueinoffice anda resolutionconcerningtheir Independent auditors the Group andCompany’sauditorsare aware of that information. ought tohave taken asaDirector inorder tomake himself aware of anyrelevant auditinformation andtoestablishthat information of whichtheGroup andCompany’sauditorsare unaware, andeachDirector hastaken allthestepsthat he In accordance withs418of theCompaniesAct2006, sofaraseachDirector isaware, there isnorelevant audit Statement astodisclosureofinformation toauditors information necessaryfor shareholders toassesstheGroup’s positionandperformance, businessmodelandstrategy. We considertheAnnualreport andaccounts,taken asawhole,isfair, balancedandunderstandableprovides the — — We confirm that tothebest of ourknowledge: Responsibility statementoftheDirectors inrespectoftheannualfinancialreport for theyearended31December2019 Directors’ report Corporate governance Oxford Biomedica plc|Annual report andaccounts2019

principal risks and uncertainties that they face. principal risks anduncertaintiesthat theyface. the issuerandundertakingsincludedinconsolidation taken asawhole,togetherwithdescriptionof the the consolidation taken asawhole;and view of theassets,liabilities,financialpositionandprofit orloss oftheCompanyandundertakingsincludedin the financialsta Strategic report includes a fair review of the development and performance of the business and the position of tements, prepared inaccordance withtheapplicablesetof accountingstandards, giveatrueandfair New: Bioprocessing revenue recognition (2018: Oxford Biomedica plc|Annual report andaccounts2019 New: Goingconcernmaterial uncertaintyandtheimpactof uncertaintiesduetotheCOVID-19 pandemic(2018: Key auditmattersvs2018( Coverage: 100.0% of Group revenue (2018:100%). Materiality: Overview applied tolistedpublicinterest entities.Nonon-audit servicesprohibited bythat standard were provided. remain independent of the Group in accordance with, UK ethical requirements including the FRC Ethical Standard as is for thetwofinancialyearsended31December2019. We have fulfilledourethical responsibilitiesunder,we and We were firstappointedasauditorbytheshareholders on29May2018. Theperiod of totaluninterruptedengagement appropriate basis for ouropinion.Ourauditopinionisconsistentwithreport totheauditcommittee. Our responsibilities are describedbelow. We believethat theauditevidencewehave obtainedisasufficientand We conductedourauditinaccordance withInternational Standards onAuditing(UK)(“ISAs (UK)”)andapplicablelaw. Basis foropinion — — — — In ouropinion: policies innote statements of changesinequityattributable toownersof theparent, andtherelated notes,includingtheaccounting of financialpositions,theGroup andparent Companystatements of cashflows,the Group andparent Company 2019 whichcomprisetheconsolidated statement of comprehensive income,theGroup andparent CompanyStatement We have auditedthefinancialstatements of Oxford Biomedicaplc(“theCompany”) for theyearended31December 1. Ouropinionisunmodified To themembersofOxfordBiomedicaplc Independent auditors’report New: Uncertainoutcomeof customerclaim(2018: Recurring: Recoverabilityof parent Company’sinvestmentinandloansduefrom subsidiaries(2018:

31 December2019andof theGroup’s profit for theyearthenended; and, asregards theGroup financialstatements, Article4 of theIASRegulation. and thefinancialsta the EUandasappliedinaccordance withtheprovisions of theCompaniesAct2006; and thepar Standards asadoptedbytheEuropean Union(IFRSsasadoptedbytheEU); the the financialsta Group financial statements have been properly prepared inaccordance with International Financial Reporting Group financialstatements asawhole£520k(2018:£570k) 0.81% of revenue (2018: 0.85%). ent Companyfinancialstatements have beenproperly prepared inaccordance withIFRSsasadoptedby

1. tements giveatrueandfairviewof thestate of theGroup’s andparent Company’saffairs as at tements have beenprepared inaccordance withtherequirements of theCompaniesAct2006 New and recurring risks): New andrecurring risks): ). ).

). ).

Independent auditors’ report 101 102 not provide aseparate opiniononthesematters. statements asawhole,andinforming ouropinionthereon, andconsequentlyare incidentaltothat opinion,andwedo results are based on procedures undertaken, in the context of, and solely for the purpose of, our audit of thefinancial and, asrequired for publicinterest entities,ourresults from those procedures. These matters were addressed, andour significance, inarriving at ourauditopinionabove,togetherwith key auditprocedures toaddress thosematters and is described in section 2 of our report. We summarise below the key audit matters, in decreasing order of audit resources in the audit;anddirecting theefforts of theengagement team. Going concern isasignificant keyaudit matter to fraud)identifiedbyus,includingthosewhichhadthegreatestof effect on:theoverall audit strategy; theallocation the financialstatements andincludethemostsignificantassessedrisks of material misstatement (whetheror notdue Other key auditmatters are thosematters that, inourprofessional judgment,were of mostsignificanceintheaudit of 3. Otherkey auditmatters:includingourassessmentofrisksmaterialmisstatement materially inconsistentwithourauditknowledge.We have nothingtoreport inthisrespect. We are required toreport toyouifthedirectors’ goingconcernstatement undertheListingRulessetoutonpage96is in respect of thismatter. Our opinionisnotmodified as agoingconcern. company’s abilitytocontinue the group’s andtheparent may castsignificantdoubton a material uncertaintythat explained innote1,constitute along withtheothermatters These eventsandconditions, initiatives. other governmentfinance or financing, loanfinancing funding intheform of equity is dependentonadditional continue as a going concern company’s abilityto Group’s andtheparent which indicates that the to thefinancialstatements We drawattention tonote1 pandemic uncertainties ofCOVID-19 the impactof going concern,including uncertainty inrelationto Going concern–material 2. Materialuncertaintyrelatedtogoingconcern To themembersofOxfordBiomedicaplc Independent auditors’report Oxford Biomedica plc|Annual report andaccounts2019 key financial statements disclosure. key financialstatements disclosure. with adescriptionof thecircumstances, isa disclosed (ashasbeendone)and,along concern. Ifsothat factisrequired tobe about theirabilitytocontinueasagoing uncertainty that maycastsignificantdoubt risks are suchthat theyamounttoamaterial The riskfor ourauditiswhetherornotthose approval of thefinancialstatements. over aperiodof at leastayearfrom the resources orabilitytocontinueoperations the Group’s andtheCompany’sfinancial pandemic, andhowthoserisks mightaffect impact of theuncertaintiesof COVID-19 company’s accesstofunding,includingthe of theinherent risks totheGroup andparent Their judgementisbasedontheevaluation Parent company. basis of preparation for theGroup and it isappropriate toadoptthegoingconcern management hasformed ajudgementthat The financialstatements explainhow Disclosure quality The risk to beacceptable. Our results: We found thedisclosure qualityof thematerial uncertainty — Our response — — — Our procedures included:

— — reference totheoutcomeof theprocedures detailedabove. of thematters covered inthegoingconcerndisclosures with Assessing transparency: Sensitivity analysis: historical reliability of data. cash flowsachievedintheyearandprevious yearstoassess Historical comparisons: risks materialise. cost saving actionstheyconsiderwouldimprove thepositionshould management andthetimingachievabilityof fundingoptionsand Evaluating management’sintent:

it operates in. to historicaltrends andourknowledgeof thebusinessandsector revenue volumes,growth rates, andexpectedcostsbycomparing Challenged managementontheappr level of available financial resources. individually andcollectivelywhilstconsideringtheeffect onthe unrealistic) adverseeffects that couldarisefrom theserisks the company’ssensitivityanalysisonreasonably possible(butnot Considering k

ey inputs into the cash flow forecasts and assessing ey inputsintothecashflow forecasts andassessing Assessing cashflow forecasts against actual Assessingcashflow forecasts againstactual Assessing the completeness and accuracy Assessingthecompletenessandaccuracy Evaluating the intent of the Evaluating theintentof the opriateness of expected opriateness of expected Oxford Biomedica plc|Annual report andaccounts2019 (financial disclosures). Investments: Group page 133note15 (accounting policy)and investment insubsidiaries Refer topage120 (2018: 68.7m) undertakings £122.1m Loans togroup (2018:£15.2m). Investments: Group £15.2m due fromsubsidiaries and intercompanyloans Company’s investmentin Recoverability ofparent customer in2018and2019. performed onbehalfof the development work respect of acertainprocess Group. Theclaimisin potential claimagainstthe uncertain outcomeof a Statements concerningthe 36 of theFinancial We drawattention tonote customer claim Uncertain outcomeof disclosures). disclosures (financial contract balances Refer tonote20, page136 committee report and page72of audit income (accountingpolicy) liabilities anddeferred Refer topage121Contract contract liabilities) including £nilrelating to liabilities. (2018:£(18.4m) to bioprocessing contract including the£1.8m relating Contract liabilities:£(13.8m) contract liabilities recognition andrelated Bioprocessing revenue separately identified inour report thisyear. year wehave notassessedthese tobethemostsignificantrisks inourcurrent yearauditand, therefore, itisnot We continuetoperform procedures overcontractrevenue recognition. However, basedonthecontracts signedinthe overall parent Companyaudit. the areas that hadthegreatest effect onour financial statements, thisisconsidered tobe in thecontextof theparent Company judgements. However, duetotheirmateriality misstatement orsubjecttosignificant recoverability isnotat highriskof significant (99.7%) of theCompany’stotal assets. Their loans tothesoletradingsubsidiaryrepresents Company’s investmentinandintercompany The carryingamountof theparent highvalue Low risk, disclosed. financial statement disclosures, are and estimation uncertainties,whichare key circumstances, risks, significantjudgements, The riskfor ourauditiswhetherornotthe third party. balances relating toapotentialclaimfrom a quantum andtiming(ifany)onaccount the levelof uncertaintyinestimating the to theGroup andtheParent companyof based ontheevaluation of theinherent risks management have formed ajudgement The financialstatements explainhow Disclosure Quality statements asawhole greater thanourmateriality for thefinancial potential rangeof reasonable outcomes degree of estimation uncertainty, witha value of therefund liabilityhasahigh risk assessment,wedeterminedthat the effect of thismatter isthat, aspart of our the Statement of financialpositiondate. The contract liability)for future batch failures at estimate arefund liability(bioprocessing Management useshistoricaldata to overtime willsubsequentlybereversed. that amountsrecognised asrevenue inadequate yield.Therefore, there isarisk specifications duetocontamination or batches mayfailtomeettherequired lentiviral vectorsiscomplex,suchthat recognised overtime.Bioprocessing of manufacture of lentiviralvectorsandis Bioprocessing revenue relates tothe Subjective estimate The risk — — Our procedures included: — — — Our procedures included: Our response — Our Results: We found thedisclosure qualityof thematter tobeacceptable. acceptable. liability andrelated disclosures of theestimation uncertaintytobe Our results: We found theGroup’s estimate of theBioprocessing refund — — — — — Our procedures included: acceptable) investment inandloansduefrom itssubsidiariestobeacceptable(2018: Our results: We found theParent’s assessmentof therecoverability of the — —

Comparing thecarryingamounto Comparing thecarryingamounto T Assessing transparency: Enquir assets andliabilitiesheldbytheparent Company. the Group’s market capitalisation asadjustedbythetradeandmonetary Group undertakingswiththeexpectedvalueof thebusinessbasedon external costsfrom thecustomer, againstknownfactsandcircumstances. reached, inparticulartherevenue reversal andthelikelihood of aclaimfor on theappropriate accountingtreatment andassessingconclusions analysis:ChallengingtheGroup’s judgementandestimates Accounting counsel accompaniedbyformal confirmations from that counsel. value inusemodel quantum of anyoutflows. nature of thejudgementsandaccountingestimates onthetimingand of theGroup andof theParent Companyandtheinherently subjective clear andsufficientdescription ofthe nature ofthecontingentliability recognition of thebioprocessing contractliability. disclosures abouttheestimation uncertaintyinvolvedinthe Assessing transparency: reasonable rangeof potentialoutcomes. Sensitivity analysis: second halfof theyear. as previously recognised, basedondevelopmentsthrough the Historical comparisons: who holdstheregulatory licensefor releasing finishedproducts. with individualsinthetechnicalteam,includingQualifiedPerson, Personnel inter in determiningtheirestimate of future batch failures. Accounting analysis: impact of reasonably possible changes to key assumptions. impact of reasonably possiblechangestokey assumptions. Sensitivity analysis: reliability of theforecasts. results achievedintheyearandprevious yearstoassesshistorical Historical comparisons: investment’s andtheloansowedbygr to assesswhetherthere are anyindicators of impairmentof the of theGroup’s assets,beinganindication of itsrecoverable amount Confirming the mathematical integrity of the company’s est ofdetails:Confirming themathematical integrity of thecompany’s Inspecting correspondence with the Group’s external y oflawyers: Inspectingcorrespondence withtheGroup’s external

Corroborating reasonableness of assumptions views: Corroborating reasonableness of assumptions Performing sensitivity analysis to evaluate the Performing sensitivityanalysistoevaluate the Performing sensitivity analysis to assess the Performing sensitivityanalysistoassessthe Assessing the assumptions made by the Group AssessingtheassumptionsmadebyGroup Assessing cashflow forecasts against historical Assessingcashflow forecasts againsthistorical Assessing whether the disclosures provide a Assessingwhetherthedisclosures provide a Evaluating theaccuracyof thefailure rate Assessing the adequacy of the Group’s Assessingtheadequacyof theGroup’s f the investment to the value in use f theinvestmenttovalueinuse f theinvestmentandloansowedby oup undertakings. oup undertakings.

Independent auditors’ report 103 Independent auditors’ report 104 To the members of Oxford Biomedica plc

4. Our application of materiality and an overview of the scope of our audit Materiality for the Group financial statements as a whole was set at £520k (2018: £570k), determined with reference to a benchmark of revenue of which it represents 0.81% (2018: 0.85%). We consider total revenue to be the most appropriate benchmark as it provides a more stable measure year on year than group profit before tax. Materiality for the parent Company financial statements as a whole was set at £180k (2018: £540k), determined with reference to a benchmark of Company total assets, of which it represents 0.26% (2018: 0.58%). We agreed to report to the Audit Committee any corrected or uncorrected identified misstatements exceeding £25.5k (2018: £28.0k), in addition to other identified misstatements that warranted reporting on qualitative grounds. Of the group’s 4 components, we subjected 2 to full scope audits for group purposes. The components within the scope of our work accounted for 100% of group revenue, profit before tax and total assets (2018: 100% of group revenue, profit before tax and total assets). The Group team approved the component materialities, which were set at £484k and £180k for both in-scope components (2018: £540k for both). The work on all of the components, including the audit of the parent Company, was performed by the Group team.

£520k Whole financial statements materiality (2018: £570k)

£180k – £484k Materiality’s at 2 component (2018: £540k)

£25.5k Revenue Misstatements reported to the Group materiality audit committee (2018: £28.0k) Revenue Group Materiality £64.1m (2018: £66.8m) £520k (2018: £570k)

5. We have nothing to report on the other information in the Annual report The directors are responsible for the other information presented in the Annual report together with the financial statements. Our opinion on the financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, except as explicitly stated below, any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether, based on our financial statements audit work, the information therein is materially misstated or inconsistent with the financial statements or our audit knowledge. Based solely on that work we have not identified material misstatements in the other information.

Strategic report and directors’ report Based solely on our work on the other information: — we have not identified material misstatements in the strategic report and the directors’ report; — in our opinion the information given in those reports for the financial year is consistent with the financial statements; and — in our opinion those reports have been prepared in accordance with the Companies Act 2006.

Oxford Biomedica plc | Annual report and accounts 2019 Oxford Biomedica plc|Annual report andaccounts2019 — — — — Under theCompaniesAct2006, weare required toreport toyouif, inouropinion: We have nothingtoreportontheothermatterswhichwearerequiredbyexception — — We are required toreport toyouif: Corporate governancedisclosures report onthesestatements isnotaguaranteeastotheGroup’s andCompany’slonger-term viability. that are inconsistentwithjudgmentsthat were reasonable at thetimetheywere made,theabsenceof anythingto statements audit.Aswecannotpredict allfuture eventsorconditionsandassubsequentmayresult inoutcomes Our workislimitedtoassessingthesematters inthecontextof onlytheknowledgeacquired duringourfinancial Under theListingRulesweare required toreview theviabilitystatement. We have nothingtoreport inthisrespect. — — — to goingconcernreferred toabove,wehave nothingfurthermaterial toaddordrawattention toinrelation to: Based ontheknowledgeweacquired duringourfinancialstatements audit,otherthanthematerial uncertainty related Disclosures ofprincipalrisksandlonger-termviability with theCompaniesAct2006. In ouropinionthepartof thedirectors’ remuneration report tobeauditedhasbeenproperly prepared inaccordance Directors’ remunerationreport We have nothingtoreport intheserespects.

we ha certain disclosur agreement withtheaccountingrecords and returns; or the been received from branchesnotvisitedbyus;or adequa communicated byustotheAuditCommittee. the sectiono position andperformance, businessmodelandstrategy; or is fair, balancedandunderstandableprovides theinformation necessary for shareholders toassesstheGroup’s audit andthedirectors’ statement that theyconsiderthat theannualreport andfinancialstatements taken asawhole we qualifications orassumptions. fall dueovertheperiodof theirassessment,includinganyrelated disclosures drawingattention toanynecessary they have areasonable expectation that theGroup willbeabletocontinueinoperation andmeetitsliabilitiesasthey period theyhave donesoandwhytheyconsidered that periodtobeappropriate, andtheirstatement astowhether the dir and mitigated; and the Principalrisk solvency andliquidity; of theprincipalrisks facingtheGroup, includingthosethat wouldthreaten itsbusinessmodel,future performance, the dir have identified material inconsistencies between the knowledge we acquired during our financial statements parent Company financial statements and the part of the directors’ remuneration report to be audited are not in ve notreceived alltheinformation andexplanations werequire for ouraudit. ectors’ explanation intheviabilitystatement of howtheyhave assessedtheprospects of theGroup, overwhat ectors’ confirmation withintheviabilitystatement onpage97that theyhave carriedouta robust assessment te accountingrecords have notbeen kept bytheparent Company, orreturns adequate for ouraudithave not f theannualreport describingtheworkof theAuditCommitteedoesnotappropriately address matters s facing the business disclosures describing these risks and explaining how they are being managed s facingthebusinessdisclosures describingtheserisks andexplaininghowtheyare beingmanaged es of directors’ remuneration specifiedbylaware notmade;or

Independent auditors’ report 105 106 cannot beexpectedtodetect non-compliancewithalllawsandregulations. misrepresentations, ortheoverrideof internalcontrols. We are notresponsible for preventing non-complianceand higher riskof non-detectionof irregularities, asthesemayinvolve collusion,forgery, intentionalomissions, limited procedures required byauditingstandards wouldidentifyit.Inaddition,aswithanyaudit,there remained a (irregularities) isfrom theeventsandtransactionsreflected inthefinancial statements, thelesslikely theinherently accordance withauditing standards. Forexample,thefurtherremoved non-compliancewithlawsandregulations misstatements inthefinancialstatements, eventhoughwe have properly plannedandperformed ourauditin Owing totheinherent limitations of anaudit,there isanunavoidable riskthat wemaynot have detectedsomematerial These limitedprocedures didnotidentifyactualorsuspectednon-compliance. enquiry of thedirectors andothermanagementinspectionof regulatory andlegal correspondence, ifany. Auditing standards limit the required audit procedures to identifynon-compliancewiththeselawsandregulations to Medicines andHealthcare products Regulatory Agency(MHRA)recognising theregulated nature of theGroup’s activities. such aneffect: those related tothepharmaceuticalindustryimposedbyFoodand DrugAdministration (FDA) and or litigation orthelossof thegroup’s licencetooperate. We identifiedthe following areas asthose mostlikely tohave have amaterial effect onamountsordisclosures inthefinancialstatements, forinstancethrough theimposition offines Secondly, thegroup issubjecttomanyotherlawsandregulations where theconsequencesof non-compliance could statement items. We assessedtheextentof compliancewiththeselawsandregulations aspartof ourprocedures ontherelated financial reporting legislation (includingrelated companieslegislation), distributableprofits legislation andtaxation legislation Firstly, thegroup issubjecttolawsandregulations that directly affect the financialstatements includingfinancial The potentialeffect of theselawsand regulations onthefinancialstatements variesconsiderably. throughout ourteamandremained alerttoanyindications of non-compliancethroughout theaudit. and procedures regarding compliancewithlawsandregulations. We communicated identifiedlawsand regulations management (asrequired byauditingstandards), anddiscussedwiththedirectors andothermanagementthepolicies statements from ourgeneralcommercial andsectorexperiencethrough discussionwiththedirectors andother We identifiedareas of lawsand regulations that could reasonably beexpectedtohave amaterial effect onthe financial Irregularities –abilitytodetect A fullerdescriptionof ourresponsibilities isprovided ontheFRC’swebsiteat www.frc.org.uk/auditorsresponsibilities. to influence theeconomicdecisions of userstaken on the basis of thefinancialstatements. other irregularities orerror andare considered material if, individuallyorinaggregate, theycouldreasonably beexpected accordance withISAs(UK)willalwaysdetectamaterial misstatement whenitexists.Misstatements canarisefrom fraud, auditor’s report. Reasonableassuranceisahighlevelof assurance,butdoesnotguaranteethat anauditconductedin material misstatement, whetherduetofraudorotherirregularities (seebelow),orerror, andtoissueouropinioninan Our objectivesare toobtainreasonable assuranceaboutwhetherthefinancialstatements asawholeare free from Auditor’s responsibilities to liquidate theparent CompanyorGroup ortoceaseoperations, orhave norealistic alternative buttodoso. applicable, matters related togoingconcern;andusingtheconcernbasisof accountingunlesstheyeitherintend fraud orerror; assessingtheparent Group andparent Company’sabilitytocontinueasagoingconcern,disclosing, is necessarytoenablethepreparation of financialstatements that are free from material misstatement, whetherdueto financial statements includingbeingsatisfied that theygiveatrueandfairview;suchinternalcontrol astheydetermine As explainedmore fullyintheirstatement setoutonpage99, thedirectors are responsible for: thepreparation of the Directors’ responsibilities 6. Respective responsibilities To themembersofOxfordBiomedicaplc Independent auditors’report Oxford Biomedica plc|Annual report andaccounts2019 Oxford Biomedica plc|Annual report andaccounts2019 6 May2020 RG1 3AD Reading 33 ForburyRoad 2 ForburyPlace Chartered Accountants for andonbehalf ofKPMGLLP, Auditor Statutory Auditor) William Smith(SeniorStatutory as abody, for ourauditwork,for thisreport, orfor theopinionswehave formed. by law, wedonotacceptorassumeresponsibility toanyoneotherthantheCompanyandCompany’smembers, matters weare required tostate totheminanauditor’sreport andfor nootherpurpose.To thefullestextentpermitted Companies Act2006. Ourauditworkhasbeenundertaken sothat wemightstate totheCompany’smembersthose This report ismadesolelytotheCompany’smembers,asabody, inaccordance withChapter3of Part16of the 7. Thepurposeofourauditworkandto whomweoweourresponsibilities

Independent auditors’ report 107 The Group has pioneered this science from the beginning. The Group must now maintain momentum, seize opportunity and remain front and centre as gene therapies become commonly used healthcare solutions for millions of people everywhere. It’s going mainstream. Fast. Oxford Biomedica plc|Annual report andaccounts2019

109 101 151 154 110 11 112 113 151 111 48 94 20 66 28 38 58 26 34 63 36 57 2 15 22 25 55 76 37 18 16 11 4 4 4 3 1 7

tion ted ted

Group financial statements 109 110 The lossfor theyearisattributable totheownersof theparent. There wasnoothercomprehensive incomeorlossineitheryear. Continuing operations for theyearended31December2019 Consolidated statementofcomprehensiveincome Group financial statements Oxford Biomedica plc|Annual report andaccounts2019 Finance costs per ordinary share per ordinary Diluted (loss)/earnings Operating (loss)/profit Operating (loss)/profit through profit andloss Change infairassetheldat fairvalue Revaluation of investments Revenue for theyear comprehensive (expense)/income (Loss)/ profit andtotal Taxation (Loss)/profit beforetax Research anddevelopmentcosts Gross profit Cost of sales Other operating income Administrative expenses Bioprocessing costs per ordinary share per ordinary Basic (loss)/earnings Finance income

Note 29 8 4 4 4 4 6 6 9 9 (20,889) (22,546) (16,066) (22.10p) (22.10p) (14,467) (35,723) (11,881) 64,060 (6,526) (1,883) 28,337 (7,378) £’000 4,823 2019 884 104 – (33,261) (17,973) 10.89p (8,972) 66,778 (1,243) (7,433) 33,517 13,915 11.57p £’000 5,983 1,064 2,527 5,014 7,541 2018 71 – Loans Non-current liabilities Net currentassets/(liabilities) Equity attributable to owners Equity attributabletoowners Net assets Inventories Current assets Trade andother payables Current liabilities Provisions Current taxassets Accumulated losses Provisions Trade andotherreceivables Investments andloansinsubsidiary Lease liabilities Lease liabilities Contract Liabilities Cash andcashequivalents Property, plantandequipment Deferred taxliabilities Or of theparent Trade andother receivables Deferred taxassets Other reserves Assets at fairvaluethrough profit andloss Deferred income Total equity Share premium account Deferred income Intangible assets Non-current assets Assets profit andloss Investment at fairvaluethrough Contract liabilities Chief Executive Officer John Dawson on itsbehalfby: The financialstatements onpages110to150were approved bytheBoard of Directors on6May2020andwere signed The Companymadealossfor theyearof £2,016,000 (2018:£446,000). The Company’sregistered numberis03252665. Oxford Biomedica plc|Annual report andaccounts2019 as at 31December2019 Statement offinancialpositions Group financial statements dinary shares

Note 20 20 20 20 30 26 29 24 24 22 22 33 33 25 18 16 19 14 21 12 13 15 17 17 11 8 (187,695) 222,618 30,045 30,045 28,941 38,416 16,243 75,630 75,630 65,991 14,297 61,932 56,937 27,996 18,357 13,156 £’000 5,086 1,006 1,006 3,605 2,291 2,579 1,695 3,310 2,719 7,907 5,351 2019 482 359 359 Group 95 – – – – (173,876) 172,074 28,506 33,034 26,585 46,874 32,244 65,526 10,966 37,020 49,153 17,084 34,741 34,741 41,153 11,422 31,791 £’000 4,000 3,509 2,446 5,033 4,251 1,287 1,401 2018 279 117 – – – – – – – (125,093) 222,618 146,761 147,120 147,013 147,013 38,416 11,072 £’000 (107) 2019 Company 109 109 359 359 – – – – – – – – – – – – – – – – – – – 2 2

(123,077) 172,074 33,034 92,762 92,762 92,915 91,786 10,731 £’000 1,129 2018 (153) 164 164 11 11 – – – – – – – – – – – – – – – – – – –

Group financial statements 111 112 Inter investment assets Proceeds ondisposalof plant andequipment Proceeds ondisposalof property, Cash (usedin) / genera from operatingactivities Cash flows Purchases of intangibleassets Loans repaid Payment of leaseliabilities Redemption fee Interest paid Loan tosubsidiary Costs of share issues Pur from investingactivities Cash flows operating activities Net cash(usedin) / generated from Tax credit received from financingactivities Net cashgenerated of warrants Proceeds from theexercise and equipment operations for theyearended31December2019 Statements ofcashflows Group financial statements Oxford Biomedica plc|Annual report andaccounts2019 ordinary share capital Pr from financingactivities Cash flows Net cashusedininvestingactivities at 31December Cash andcashequivalents at 1January Cash andcashequivalents in cashandequivalents Net (decrease)/ increaseincash oceeds from issue of oceeds from issueof chases of property, plant est received

ted from ted from

25, 26 Note 26 25 18 21 12 31 11 (43,589) (16, (19,398) (25,774) (6,636) (3,508) 32,244 16,243 (2,513) 54,132 £’000 6, 6,270 1,345 3,128 (866) (769) (835) 2019 001) 905 104 Group – – 2 (10,096) (10,103) 32,244 (4,665) 12,868 1 (1,376) 21,184 15,143 17,915 £’000 4,329 3,654 9,214 2018 (45) 52 – – – – – – (53,416) (1,301) (1,301) 54,132 £’000 1,292 1,345 (769) 2019 Company (9) 11 – – – – – – – – – – – 2 (18,304) (1,483) (1,483) (1,376) 21,143 £’000 1,463 2018 (20) 31 11 – – – – – – – – – – – – Share options Transactions withowners: Share options Transactions withowners: Cost ofshareissues Total comprehensive expensefor theyear Total comprehensive incomefor theyear Total comprehensiveexpensefortheyear Total comprehensive expensefortheyear Issue ofsharesexcluding options Share options At 31December2019 Issue ofsharesexcluding options At 31December2018 Issue of shares excluding options At 31December2018 Issue of shares excluding options Share options Transactions with owners: Exercise ofwarrants Exercise ofwarrants Cost ofshareissues Cost OfShare Issues Cost of share issues Cost of share issues Loss for theyear Year ended31December2018: Income for theyear Year ended31December2018 A At 31December 2019 A Oxford Biomedica plc|Annual report andaccounts2019 for theyearended31December2019 Statements ofchangesinequityattributabletoownerstheparent Group financial statements Company Group Loss fortheyear Year ended31December2019: Loss fortheyear Year ended 31December2019: t 1January2018 t 1January2018 Proceeds from shares issued Proceeds fromsharesissued Credit inrelationtoemployeeshareschemes Value ofemployeeservices Value of employeeservices Credit inrelation toemployeeshare schemes Proceeds fromsharesissued Proceeds from shares issued Notes Notes 28, 29 26, 28 28, 29 28, 29 25. 26 25, 26 25, 26 25, 26 25, 26 25, 26 25, 26 28 26 26 26 26 10 10

Ordinary Ordinary Ordinary Ordinary 30412042,291 172,074 33,034 3041204150128793(2,7)92,762 (123,077) 7,933 1,218 1,580 172,074 33,034 84622682,291 222,618 38,416 84622681,580 222,618 38,416 10614241501,218 1,580 154,224 31,076 2,291 154,224 31,076 shares shares £’000 £’000 ,4 1,218 1,345 ,4 1,218 1,345 ,7 49,600 3,875 49,600 3,875 ,1 18,748 1,712 ,1 18,748 1,712 6 495 162 495 162 246 246 – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – –

premium premium premium premium account account (1,376) (1,376) £’000 £’000 Shar Shar (769) (769) 478 478 e e e e

Mer Mer £’000 £’000 ger ger – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – –

Reserves Reserves T W reasury (1,218) £’000 £’000 arrant – – – – –

W (1,218) ,9 1503 147,013 (125,093) 9,492 £’000 £’000 Other arrant 1,559 ,1 1386 34,741 (173,876) 1,218 6,801 ,1 1263 6,146 (182,663) 1,218 1,132 –

Accumulated Accumulated 1765 75,630 (187,695) 1250 72,309 (122,590) 1,6)(16,066) (16,066) (16, 206 (2,016) (2,016) (2, losses losses ,4 2,247 2,247 £’000 £’000 ,4 1,246 1,246 46 (446) (446) 46 (446) (446) ,4 7,541 7,541 ,4 7,541 7,541 6)(16,066) 066) 1)(2,016) 016) 4)1,091 (41) – – – – – – – – – – – – – – – 53,475 53,475 20,460 20,460 (1,376) (1,376) equity equity £’000 £’000 1,345 1,345 1,559 (769) (769) Total Total 657 657 724 724

Group financial statements 113 114 customer contractsfor process developmentandbioprocessing services. delivered orsecuringthebenefit of any upfront receipts from licensingouttheGroup’s intellectual property orwinnew known andexpectedrevenues from existing customersunderlongtermcontracts,whichare ongoingbut stilltobe these financialstatements iftheGroup couldnotsecure theexternalfinancing andcontinueto execute and recover identified that theGroup wouldnotbeabletocontinueitsactivities for at least12monthsfrom thedate of approval of review of thedetailedcashflow forecast prepared aspart of the goingconcernassessmentprocess. Theprocess to raisefundinginlinewiththeoriginallyplannedtimeline. Therefore, theBoard hasundertaken amuchmore rigorous of equitytotheinvestmentcommunityasplannedhasbecome verydifficultandthe Group hasnothadtheopportunity Due tovolatility inthefinancialmarkets created bytheimpact of the COVID-19 pandemic,fundraisingthrough issuance initiatives inorder tocontinueitsoperations andcurrent capabilities. Group requires additionalfinancinginthe form of equityfinancing,loanfinancingorothergovernmentfinance customers. DuetotheGroup’s scale-upof investmentsandstrategic decision toincrease it’sbioprocessing facility, the scenarios incorporating underperformance againstthebusinessplan,unexpectedcashout assessed identi In assessing the going concern assumptions,the Board has undertaken a rigorous assessment of theforecasts and strategic decisiontoincrease itsbioprocessing capacity. flow, thiswaslargely duetooperational scale-up of investmentsinits people andoperational capabilitiesaspart of the Although in2019theGroup recorded anoperating lossof £14.5 millionanddidnotgenerate positive operational cash The Group held£16.2 millionand£17.2 millionof cashat theendof December2019andApril2020respectively. notes tothesefinancialstatements. The financialposition of theGroup, itscashflowsandliquidityposition are describedintheprimarystatements and Going concern significant tothefinancialstatements, are disclosedinNote2. policies. Theareas involvingahigherdegree of judgementorcomplexity, orwhere assumptionsandestimates are estimates. Italsorequires managementtoexercise itsjudgementintheprocess of applyingtheGroup’s accounting The preparation of thefinancialstatements inconformity withIFRS requires theuse of certaincriticalaccounting A summaryof themore importantGroup accountingpoliciesare setoutbelow. in preparing thefinancialstatements. As more fullyexplainedintheDirectors’ report onpages76to93andbelow, thegoingconcernbasishasbeenadopted historic costconventionasmodifiedbythe revaluation of financialassets atfairvaluethrough profit andloss. Act 2006asapplicabletocompaniesreporting underIFRS. Thefinancialstatements have beenprepared underthe and IFRSInterpretations Committee(’IFRSIC’)interpretations asadoptedbytheEuropean UnionandwiththeCompanies The financial statements have beenprepared in accordance with International Financial Reporting Standards (’IFRS’) policies have beenconsistentlyappliedtoallthefinancialyearspresented, unlessotherwisestated. The principalaccountingpoliciesadoptedinthepreparation of thesefinancialstatements are setoutbelow. These Basis ofpreparation marketed pharmaceuticalproducts. business providing bioprocessing andprocess developmentservicestothird parties.TheGroup currently hasno The Group is a gene and cell therapy research and development business which is also building a revenue-generating The Company’sprincipalsubsidiaryisOxford Biomedica(UK)Limited. comprise theresults of theCompanyanditssubsidiaryundertakings(togetherreferred toastheGroup). and listedontheLondonStock Exchange. Theconsolidated financialstatements for theyearended31December2019 Oxford Biomedicaplc(theCompany)isapubliccompanylimitedbyshares, incorporated anddomiciledinEngland, 1. Accountingpolicies for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019 fi ed downside risks and mitigating actions. The downside risks include a number of severe but plausible ed downsiderisks andmitigating actions.Thedownsiderisks includeanumberof severe butplausible fl ows and fewer new ows andfewer new — — Oxford Biomedica plc|Annual report andaccounts2019 financial statements. Of thesestandards that became effective from 1January2019, onlyIFRS16hadamaterial impactontheGroup — — — — — — The Group hasadoptedthefollowing IFRSsinthesefinancialstatements. Accounting developments the Group’s contingencyplanningisprovided onpage62. landscape intheUK,Group hasassessedthefuture impactof Brexit onitsoperations tobeminor. Further detailsof Although theUK’sdecisiontoleave theEuropean Unionmaysignificantly affect thefiscal,monetaryand regulatory Therefore theDirectors have continuedtoadoptthegoingconcernbasisof preparation inthefinancialstatements. — — — going concernbasisfor thefollowing reasons: However, despitetheaboveuncertainties,Board a has theconfidence that theaccounts shouldbeprepared on circumstances, itmaytherefore beunabletorealise itsassetsanddischarge itsliabilitiesinthenormalcourseof business. or conditionsthat maycastsigni The abovesituation givesrisetoamaterial uncertainty, asde it wouldnotbeabletogenerate sufficientcashflowstosupportitslevel ofactivitiesbeyondthe third quarter of2020. If theGroup isunabletothesecure theexternalfinancingand receipt the revenues describedabove,ithasassessedthat customers andreduction inmilestones),areduction inassociated costsandlowerdiscretionary capitalexpenditure. assumptions includeareduction inrevenues byalmost30%(fewer newcustomers,lowerdemandfrom existing flow forecasts includetheGroup’s current assumptions,takingintoaccountthesevere butplausibledownsides. The Whilst itisdifficulttoestimate theimpact of COVID-19 duetotherapidlychanging nature ofthepandemic,cash oup haskey worker status whichallowscontinuityof providing servicestotheGroup’s financiallystable

the Gr customer basethroughout thelockdown period. the Gr comparatives have notbeenrestated andare reported underIAS17. Annual Impr Amendments toIFRS9:Pr Amendments toIAS28:Long-termInter Amendments toIAS19:PlanAmendment,Curtailment orSettlement. IFRIC 23:UncertaintyoverIncomeT IFRS the Gr the Gr external debtfinanceas required, the — —

a potentialvaccinecandidate for COVID-19, withGovernmentsupportfor thefundingof theproject expected. joining aConsortiumledbytheJennerInstitute,Oxf signing thesubstantiallicense,manufacturinganddevelopmentagr Group’s ability to potentially access the Government Coronavirus Business Interruption Loan Scheme and also Group’s abilityto potentially access the GovernmentCoronavirus BusinessInterruption Loan Scheme and also 16: Leases. Seenote 2. This has been adopted usingthemodified retrospective method andas a result the oup’s abilitytocontinuebesuccessfulinwinningnewcustomersandbuildingitsbrandasdemonstrated by: oup’s abilitytocontrol capitalexpenditure costsandlowerotheroperational spend,asnecessary. oup’s historyof beingabletoaccesscapitalmarkets and, ovements toIFRSStandards 2015-2017Cycle. epayments Features withNegative Compensation. fi cant doubt on the entity’s ability to continue as a going concern and in such cant doubtontheentity’sabilitytocontinueasagoingconcernandinsuch ax Treatments. ests inAssociates andJointVentures. ord University, torapidlydevelop,scale-upandmanufacture fi ned in auditing and accounting standards, related to events ned inauditingandaccountingstandards, related toevents

eement withJuno(BMS)inMarch 2020,

Group financial statements 115 116 in therelevant agreements orcontracts. Eachmilestoneis determinedaseitherbinary ornon-binary. obligations astheyinvolvethetransfer of adistinctgoodor service, determinedwithreference toconditions stipulated Milestones relating tobioprocessing orprocess development activitieshave beenidentifiedasseparate performance therefore not been met. and milestonepayments. The criteriafor recognising these technologylicencesas“righttoaccess” has Biomedica. Oxford Biomedica isincentivisedseparately for itsperformance obligations inrelation todevelopmentwork “right touse”licenceasour customersare abletoconductdevelopmentworkonthelicence independentof Oxford The grantingof thetechnologylicencestoGroup’s background intellectualproperty andknow-howconstitutesa licence transfers tothecustomer. than “righttoaccess”licences.Assuch,therevenue from theselicences isrecognised at thepointintimeat whichthe Technology licencesthat have beenestablishedbythegroup have allbeendeterminedas“righttouse”licences,rather service isrendered onapercentage of completionbasis. Revenues for providing process developmentactivities to partnersare recognised during theperiodinwhich recognise therevenue. Consideration received inexcess of thestage of completionwillbedeferred untilsuchtimeasitisappropriate to exceed progress billingsispresented asacontractasset separately ontheStatement of financialposition. The gross amountduefrom customersonallpartnershipsinprogress for whichcostsincurred plusrecognised profits as theprocesses are carriedout.Progress isdeterminedbasedontheachievementof verifiablestages of theprocess. Bioprocessing of clinical/commercial product for partnersisrecognised onapercentage of completionbasisovertime Platform and developmentprogrammes. development servicestopartners,product andtechnologylicencetransactions,royalties, options,andfundedresearch Revenue comprisesincome derived from bioprocessing of clinical product for partners,fees charged for providing Revenue comprehensive incomeintheperiodwhichtheyarise. of financial positiondate. Differences arisingdueto exchange rate fluctuations of are taken tothe statement Assets andliabilitiesinforeign currencies are retranslated intosterlingat therates of exchange rulingat theStatement Transactions inforeign currencies are translated intosterling at therate of exchange rulingat thetransactiondate. Foreign currencies capital of Oxford Biomedica(UK)Limitedthat hasbeen accounted for bythemerger accountingmethod. combinations whichtookplacepriorto1January2004, namelytheacquisitionin1996of 100%of theissuedshare The Group andCompanyhave electednottoapplyIFRS3’Businesscombinations’ retrospectively tobusiness statements of subsidiariestobringaccountingpoliciesusedintolinewiththoseof theGroup. recognised directly inthestatement of comprehensive income.Where necessary, adjustmentsare madetothefinancial goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is cost of the acquisition over the fair value of the Group’s share of the identifiable net assets acquired is recorded as initially at theirfairvaluesat theacquisitiondate, irrespective of theextentof anyminorityinterest. Anyexcess of the Identifiable assetsacquired, andliabilities andcontingentliabilitiesassumed inabusiness combination are measured fair valueof theassetstransferred, equityinstrumentsissued,andliabilitiesincurred orassumedat thedate of exchange. Business combinations are accountedfor usingtheacquisitionmethod.Thecostof anacquisitionismeasured asthe All intragroup transactionsandbalancesare eliminated onconsolidation. not currently have anyassociates. to governthefinancialandoperating policies of theentitysoastoobtainbenefits from itsactivities.The Group does consolidated from thedate at whichcontrol istransferred totheGroup. Control existswhere theGroup hasthepower 31 Decembereachyear. Subsidiariesare entitiesthat are directly orindirectly controlled bytheGroup. Subsidiariesare The consolidated financialstatements comprisetheCompanyanditssubsidiaryundertakings for theyearto Basis ofconsolidation for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019

Oxford Biomedica plc|Annual report andaccounts2019 deferred revenue isincludedinprepayments. included in accruals. Where revenue is spread over a number of accounting periods, the royalty attributable to the arising from suchpartners’licencesare treated ascostof sales.Where royalties duehave notbeenpaidtheyare The Group’s products andtechnologiesinclude technologyelementsthat are licensedfrom third parties.Royalties such timeasitisappropriate torecognise thecost. completion of thecontract.Costsincurred inexcess of thestageof completionare recognised asworkinprogress until directly attributable costs.Costsare recognised onapercentage of completionbasisdependent onthestageof The costof bioprocessing clinicalproduct for partnersincludestherawmaterials, labourcosts,overheadsandother such timeasitisappropriate torecognise thecost. completion of thecontract.Costsincurred inexcess of thestageof completionare recognised asworkinprogress until material andthird partycosts. Costsare recognised onapercentage of completion basisdependentonthestageof The costof customerdevelopmentproject activitiesincludesthelabour costs,overheadsandotherdirectly attributable project activities,androyalties arisingonpartners’licences. Cost of salescomprisesthecostof bioprocessing clinicalproduct for partners,thecostof customerdevelopment Cost ofsales the cost-to-costmethod. Research anddevelopmentrevenue andassociated costsare recognised overtime.Progress isdeterminedbasedon Royalty revenue isrecognised asthe underlyingsalesoccur. allocated totherelevant performance obligation. Amounts receivable ondeliveryof amilestoneperformance obligation represents variableconsideration andhave been incurred, orovertheestimated periodtocompletionof therelevant phaseof developmentorassociated clinicaltrials. Non-binary milestonesare recognised ona percentage of completion basis in the period in which related costsare or achievementof specifiedsalesvolumes,are recognised infullwhenthe relevant eventhasoccurred. stipulated inthelicenceagreement have beenmet.Paymentslinked to“success”suchasregulatory filingorapproval, are binary and will be recognised in full once it is deemed highly probable that the specific performance obligations Amounts receivable inrespect of milestonepaymentsare considered tobeseparate performance obligations which therefore notbeenmet. and milestonepayments.Thecriteriafor recognising thesetechnologylicencesas“righttoaccess”has Biomedica. Oxford Biomedicaisincentivisedseparately for itsperformance obligations inrelation todevelopmentwork “right touse”licenceasourcustomersare abletoconductdevelopmentworkonthelicenceindependentof Oxford The grantingof theproduct licencestotheGroup’s background intellectualproperty andknow-howconstitutesa licence transfers tothecustomer. than “righttoaccess”licences.Assuch,therevenue from theselicencesisrecognised at thepointintimeat whichthe Product licences that have beenestablishedbytheGroup have allbeendeterminedas“righttouse”licences,rather Product Non-cash revenues are recognised at fairvaluethrough profit andloss. Options totechnologylicencesare recognised whenthecustomerexercises theoptiontoobtainthat licence. to therelevant performance obligation. receivable ondeliveryof amilestoneperformance obligation represents variableconsideration andhave beenallocated on a percentage of completionbasis,but taking into account the likelihood of achievement of the deliverable. Amounts Milestones related totheprovision of supportservicesare considered tobenon-binaryincentivesandare recognised and willberecognised infullonceitisdeemedhighlyprobable that theobligation willbemet. example, support. Incentives related to the achievement of specificdeliverables are considered tobe binary incentives Milestones that are considered tobebinary relate totheachievementof specificeventsrather thantheprovision of, for

Group financial statements 117 118 if any, andadjustedfor certain re-measurements of theleaseliability. as thoseof property andequipment. Inaddition,the right-of-use assetisperiodically reduced byimpairmentlosses, right-of-use asset will depreciated over the useful life of the underlying asset, which is determined on the same basis lease termorthecostof theright-of-use assetreflects that theGroup willexercise apurchase option. Inthat casethe the endof theleaseterm,unless theleasetransfers ownership of theunderlyingassettoGroup bytheendof the The right-of-use assetissubsequently depreciated usingthestraight-linemethodfrom thecommencement date to the underlyingassetortorestore theunderlying assetorsiteonwhichitislocated lessanyleaseincentives received. or before thecommencementdate, plusanyinitialdirect costsincurred andanestimate of coststodismantleandremove initially measured at cost,whichcomprisestheinitialamountof thelease liabilityadjustedfor anyleasepaymentsmadeat The Group recognises aright-of-use assetandaleaseliabilityat theleasecommencementdate. Theright-of-use assetis components asasingleleasecomponent. leases of property the Group has elected to separate non-lease components and account for the lease and non-lease consideration inthecontracttoeachleasecomponenton thebasisof itsrelative stand-alone prices.However, for the At commencement or on modification of a contract that containsa lease component,theGroup allocates the As alessee This policyisappliedtocontractentered intoonorafter 1January 2019. disclosed inNote3. IAS 17andIFRIC4are disclosedseparately iftheyare different from thoseunderIFRS16andtheimpact of changesis has notbeenrestated andcontinuestobereported underIAS17andIFRIC4. Thedetailsof accountingpoliciesunder The Group hasappliedIFRS16usingthemodified retrospective approach andtherefore thecomparative information Leases exercised theproceeds received are credited toequity. options that have vested, with no charge for those options which were forfeit prior to vesting. When share options are exercisable basedonforfeiture such that at the endof thevestingperiodcumulative charge reflects theactual At each financialyearend,theGroup revises itsestimate of thenumber of optionsthat are expectedtobecome the deferred bonusplanisbasedonthemarket valueat thedate of grantof theseoptions. account theperformance conditionsunderwhichtheoptionswere granted.Thefairvalueof optionsgrantedunder schemes, whichincludesmarket conditionperformance criteria,ismeasured usingaMonteCarlomodeltakinginto share save scheme ismeasured usingtheBlack-Scholes model.Thefairvalueof optionsgrantedunderthe LTIP become unconditionallyentitledtotheoptions.Thefairvalueof optionsgrantedundertheshare optionschemesand increase inequity. Thefairvalueismeasured at thedate of grantandspread overtheperiodduringwhichemployees granted isrecognised asanexpenseof employmentinthestatement of comprehensive incomewithacorresponding plans allowgroup employeestoacquire shares of theCompanysubjecttocertaincriteria.Thefairvalueof options The Group’s employeeshare option schemes,longtermincentiveplans,save asyouearnschemeanddeferred bonus Share basedpayments retirement benefits. separately from thoseof theGroup inindependentlyadministered funds.TheGroup doesnotoffer anyotherpost- charged tothestatement of comprehensive incomeonanaccrualsbasis.Theassetsof thepensionschemeare held Employee benefitcosts,notablyholidaypayandcontributionstotheGroup’s definedcontributionpensionplan, are Employee benefitcosts expenditure isrecognised asanexpensewhenincurred. straight-line basisovertheperiodof itsexpectedbenefit.Nosuchcostshave beencapitalisedtodate. Otherdevelopment and hasafiniteusefullife isamortisedfrom thecommencement of thecommerciala production of theproduct on of regulatory approval, and theabilitytomeasure costsreliably. Development expenditure whichhasbeencapitalised will generate future economicbenefit,consideringfactorsincludingitscommercial andtechnological feasibility, status Expenditure incurred ondevelopmentprojects isrecognised asanintangibleassetwhenitisprobable that theproject period inwhichitisincurred. Research, development andbioprocessing expenditure is charged tothestatement of comprehensive income inthe Research, developmentandbioprocessing for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019

Oxford Biomedica plc|Annual report andaccounts2019 using the tax rates and laws that have been enacted, or substantially enacted, by the Statement of financial position date. Current tax,includingUKcorporation tax andforeign tax,isprovided at amountsexpected tobepaid(orrecovered) other receivables intheStatement of financial position, in research, developmentandbioprocessing costsin thestatement of comprehensive income,andwithintrade The Group alsoreceives aResearch andDevelopment Expenditure Credit (’RDEC’) whichisaccountedfor asareduction included withincurrent assetsintheStatement of financialposition untilsuchtimeasitis received. an assessmentof likely receipt, isrecognised inthestatement of comprehensive incomewiththecorresponding asset The credit ispaidinarrears oncetaxreturns have beenfiledandagreed. Thetaxcredit earnedin the period,basedon The Group isentitledtoclaimtaxcredits intheUnitedKingdomfor certainresearch anddevelopmentexpenditure. Taxation interest rate method.Italsoincludestherevaluation of externalloans denominated inaforeign currency. Finance incomeandcostscompriseinterest incomeandinterest payable duringtheyear, calculated usingtheeffective Finance incomeandcosts The changeinfairvalueof investmentassetsare recognised at fairvalueinthestatement of comprehensive income. Change infairvalueofinvestmentasset comprehensive income. Gains andlossesontherevaluation of equityinstrumentsare recognised at fairvalueinthestatement of Revaluation ofequityinstruments received, itisincludedwithinaccruedincomeontheStatement of financialposition. deferred incomeontheStatement of financialposition,whilstwhere grantincome recognised exceeds grantincome and administrative expenses.Where grantincomereceived exceeds grantincomerecognised, itisincludedwithin of comprehensive income,andtherelated costs are includedwithinresearch, developmentandbioprocessing costs, costs whichtheyare intended tocompensate. Grantincomeisincludedasotheroperating incomewithinthestatement Income from governmentandothergrantsisrecognised overtheperiodnecessarytomatch themwiththerelated Grants Group recognises leasepaymentsassociated withtheseleasesasanexpenseonastraight-linebasisovertheleaseterm. The Group haselectednottorecognise right-of-use assetsandleaseliabilitiesof short-termandlow-valuelease.The Short-term orlow-valueleases of the Statement of FinancialPosition. The Group presents right-of-use assets in ’property, plant and equipment’ and lease liabilitiesas a category on the face or isrecorded intheProfit orLossifthecarryingamount of theright-of-use assethasbeen reduced to zero. If aleaseliabilityisre-measured, acorresponding adjustmentismadetothecarryingamountof theright-of-use asset, — — — The leaseliabilityismeasured at amortisedcostusingtheeffective interest method.Itis re-measured if: Lease paymentsincludedinthemeasurement of theleaseliabilitycomprisefixed payments. makes certainadjustmentstoreflect theterms of thelease andthetype of theassetleased. The Group determinesitsincremental borrowing rate byobtaininginterest rate form externalfinancingsources and incremental borrowing rate. Generally, theGroup usesitsincremental borrowing rate asthediscountrate. date, discountedusingtheinterest rate implicitintheleaseor, ifthat rate cannotbereadily determined,theGroup’s The lease liability is initiallymeasured at the present value of the lease payments that are not paidat the commencement

ther the Gr payments; ther e isarevised in-substancefixed leasepayment. e isachangeintheGroup’s estimate of theamountexpectedtobepayableunderaresidual future lease oup changesitsassessmentof whetheritwillexercise apurchase, extensionortermination options;or

Group financial statements 119 120 Leasehold improvements Freehold property of future impairmentsbeingrequired after awritebackwas accounted for. be theGroup's trackrecord of improved financial results across thelastthree to four years,aswelltheexpectation recognised onitsinvestmentinsubsidiaries. Factors which willbetaken intoaccountwithregards tothisdecisionwill At yearendthedirectors willassesstherequirement towritebackaportionor allof anyimpairmentpreviously subsidiaries for thispurpose. that reference tothemarket capitalisation of theGroup isanappropriate externalmeasure of thevalueof theCompany’s out inIAS36, andthecarryingvalueof theCompany’sinvestmentsinsubsidiaries isadjusted.Thedirectors consider resulting inadecrease inmarket capitalisation, thedirectors considerthistobeatriggerof animpairmentreview asset material andsustainedshortfallinthemarket capitalisation, orasignificantandsustained changeinthebusiness At eachyearendthedirectors review thecarryingvalueof theCompany’sinvestment insubsidiaries.Where there isa Such investmentsare subjecttoreview, andanyimpairmentischarged tothestatement of comprehensive income. Investments in subsidiary undertakings, including shares and loans, are carried at cost less any impairment provision. awards asacapitalcontributiontothesubsidiaries,resulting inanincrease inthecostof investment. awarded toemployeesof subsidiarycompanies.Inaccordance withIFRS2,theCompanytreats thevalueof these Investments are carriedat costlessanyprovision madefor impairment.OptionsovertheCompany’s shares have been Investments insubsidiaries is performed. The bioprocessing plantsare reviewed annuallyfor impairmenttriggersand,where necessary, afullimpairmentreview should theasset’ssellingpriceexceed itsnetbookvalue. The assets’residual valuesandusefullivesare reviewed annually. Residualvaluesare setat zero andwillbereassessed Bioprocessing andlaboratory equipment Office equipmentandcomputers when itisavailable for use.Theprincipalannualrates usedfor thispurposeare: a straight-linebasisovertheexpectedusefuleconomiclivesof theassetsconcerned.Depreciation of anassetbegins Depreciation iscalculated towriteoff thecost of property, plantandequipmentlesstheirestimated residual valueson condition for itsintendeduse. Cost includestheoriginalpurchase priceof theassetandanycostsattributable tobringingtheassetitsworking Property, plantandequipmentare carriedat cost,togetherwithanyincidentalexpensesof acquisition,lessdepreciation. Property, plantandequipment which theassetorliabilityisrecovered orsettled. Measurement of deferred taxliabilitiesandassetsreflects thetaxconsequenceexpectedtofallfrom themannerin financial positiondate. or liability settled, based on tax rates and laws that have been enacted or substantially enacted by the Statement of Deferred taxismeasured at theaverage taxrates that are expectedtoapplyintheperiodswhichassetisrealised against whichthedeductibletemporarydifference canbeutilised. regarded asprobable that there willbesuitabletaxableprofits withinthesamejurisdictionin foreseeable future tax group. Anyremaining deferred taxassetisrecognised only when,onthebasisof allavailable evidence,itcanbe base. Deferred taxliabilitiesmaybeoffset againstdeferred taxassetswithinthesametaxableentityorqualifyinglocal Temporary differences are differences betweenthecarryingamount ofthe Group’s assetsandliabilitiestheirtax Deferred tax is calculated in respect of all temporary differences identified at the Statement of financial position date. for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019 (or theremaining leasetermifshorter) 20 –33% 20% 10% 10% 10% Oxford Biomedica plc|Annual report andaccounts2019 instruments. The liabilityandtheequitycomponents shouldbepresented separately ontheStatement of financialposition. the loanasa compound financialinstrument separating outtheindividual elementsintofinancial liabilitiesorequity If theGroup assessesthat aloanhaselements of bothaliabilityandanequitycomponent,theGroup will accountfor cash flowswhichconsider allthecontractualterms of thefinancialinstrument. interest expenseovertherelevant period.The calculation of theeffective interest rate takes intoaccounttheestimated The effective interest rate methodisa of calculating theamortised cost of afinancialliabilityandallocating the On subsequentmeasurement, external loansare measured at amortisedcost undertheeffective interest rate method. On initialrecognition, externalloansare measured at fairvalueplusdirectly attributable transaction costs. Financial Liability:loans Deferred incomeprimarilyrelates totheadvance consideration received for grantsandleaseincentives. Deferred income work andbioprocessing batches, aswelloptionsandfundedresearch anddevelopmentactivities. Contract liabilitiesprimarilyrelate totheadvanceconsideration received from customers for commercial development Contract liabilitiesanddeferredincome are presented asnon-current liabilities. interest method.Trade payables are classified ascurrent liabilitiesifpaymentisduewithinoneyearorless.Ifnot,they Trade payables are recognised initially at fair value and subsequently measured at amortised cost using the effective Trade payables position untilsuchtimeastherestrictions relating tothoseamountshave beenlifted. Deposits consistof amountsheldinescrow andisincludedwithinotherreceivables withintheStatement of financial Deposits investments withoriginalmaturities of three monthsorless. Cash andcashequivalentsincludeinhand,bankdepositsrepayable ondemand,andothershorttermhighlyliquid Cash andcashequivalents due according totheoriginaltermsof thereceivables. under theexpectedcredit lossmodelasestablishedbyevidencethat theGroup willnotbeabletocollectall amounts components andare subsequentlymeasured at amortisedcost.TheGroup recognises lossallowancesfor receivables Trade receivables are recognised initiallyat thetransactionpriceasthese assetsdonothave significantfinancing Trade receivables the estimated sellingpriceintheordinary courseof business,lessapplicable variablesellingexpenses. related production overheads (basedonnormaloperating capacity).Itexcludes borrowing costs.Netrealisable valueis method. Thecostof finishedgoodsandworkinprogress comprisesrawmaterials, direct labour, otherdirect costsand Inventories are stated at thelowerof costandnetrealisable value.Costisdeterminedusingtheweightedaverage Inventories valued at amortisedcost. Bank deposits with originalmaturities betweenthree months and twelvemonthsare includedin current assetsandare Bank deposits Other investmentsheldbytheGroup are classifiedasfairvaluethrough profit andloss. Investments Assets at fairvaluethrough profit andlossbytheGroup are classifiedasfairvaluethrough profit andloss. Assets at fairvaluethrough profit andloss Financial assets

Group financial statements 121 122 definition of aleaseunderIFRS16 wasappliedonlytocontractsentered intoorchangedin after 1 January 2019. identified as leasesunder IAS17 and IFRIC 4 were not reassessed for whetherthere is a lease under IFRS 16. Therefore, the are leases.TheGroup appliedIFRS16onlyto contractsthat were previously identifiedasleases.Contractsthat were not On transitiontoIFRS16, theGroup electedtoapplythepracticalexpedientgrandfather the assessmentof whichtransactions a leasebasedonthedefinition of aleaseasexplainedin Note 2. 4 ’DeterminingwhetheranArrangementcontainsaLease’. TheGroup nowassesseswhetheracontractisorcontains Previously, theGroup determinedat contract inceptionwhetheranarrangementwasorcontainedaleaseunderIFRIC Definition of alease generally beenappliedtocomparative information. the changeinaccountingpoliciesare disclosedbelow. Additionally, thedisclosure requirements inIFRS16have 2018 isnotrestated –i.e.itispresented, aspreviously reported, underIAS17andrelated interpretations. Thedetailsof application isrecognised inretained earningsat 1January2019. Accordingly, thecomparative information presented in The Group appliedIFRS16usingthemodified retrospective approach, underwhichthecumulative effect oftheinitial IFRS 16 Leases Key accountingmatters material adjustmenttothecarryingamountsof assetsandliabilitieswithinthenextfinancialyearare discussedbelow. The keya sources of estimation uncertaintyandthecriticalaccountingjudgementsthat have asignificantrisk of causing future in a number of areas. Actual results may be different from those estimated using thesejudgements andassumptions. In applyingtheGroup’s accounting policies,managementisrequired tomake judgementsandassumptionsconcerningthe 2. Criticalaccountingjudgementsandestimates and are exercisable overaperiodof time. The warrantreserve compriseswarrantsexercisable ontheenlarged Group’s share capitalwhichhave beenfairvalued Warrant reserve the issueof newshares bytheCompany, thereby attracting merger relief unders612ands613of theCompaniesAct 2006. A merger reserve isusedwhere more than90%of the shares inasubsidiaryare acquired andtheconsideration includes Merger reserve Ordinary shares are classifiedasequity. Costs of share issuesare charged totheshare premium account. Share capital time isrecognised asafinancecost. of thetimevalueof moneyandtherisks specifictotheobligations. Theincrease intheprovision duetothepassage of expected toberequired tosettletheobligation usingapre-tax discountrate that reflects thecurrent market assessments Provisions are notrecognised for future operating losses.Provisions are measured at the present valueof theexpenditure obligation; andtheamounthasbeenreliably estimated. constructive obligation asaresult of pastevents;itisprobable that anoutflow of resources willbe required tosettlethe Provisions for dilapidation costs and otherpotentialliabilitiesare recognised whenthe Group hasapresent legalor Provisions an equityinstrumentasaresidual interest. requirements for initialmeasurement of afinancialliabilityinIFRS9,of andthedefinitionsinIAS32,framework component from the initial carrying amountof the instrument as a whole. This method is consistent with the The equitycomponentismeasured astheresidual amountthat results from deductingthefairvalueof theliability On initial recognition, the issuer of a compound instrumentfirstmeasures theliability component at its fair value. for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019

as disclosedunderIAS17intheGroup’s consolidated financialstatements summarised below: to adjustments related to any prepaid or accrued lease payments and lease incentives. The impact on transition is On transitiontoIFRS16, theGroup recognised additionalright-of-use assetsandleaseliabilities.Thedifference isdue Impact ontransition The Group hadnoleasesthat were previously classifiedasfinanceleases. Leases classifiedasfinanceleasesunderIAS17 — — Oxford Biomedica plc|Annual report andaccounts2019 — leases underIAS17: The Group usedthefollowing practicalexpedientswhenapplyingIFRS16toleasespreviously classifiedasoperating indication that theright-of-use assetsare impaired. The Group testeditsright-of-use assetsfor impairmentonthedate of transitionandhasconcluded that there isno lease liability, adjustedbytheamountof anyprepaid oraccruedleasepaymentsandincentives. Group’s incremental borrowing rate asat 1January2019. Right-of-use assetsare measured at anamountequaltothe these leases,leaseliabilitieswere measured at thepresent valueof theremaining leasepayments,discountedat the Previously, theGroup classifiedproperty andITequipmentleasesasoperating leasesunderIAS17. Ontransition, for Leases classifiedasoperating leasesunderIAS17 non-lease componentsasasingleleasecomponent. of property theGroup haselectednottoseparate non-leasecomponentsandaccountfor theleaseandassociated consideration inthecontracttoeachleasecomponentonbasisof itsrelative stand-alone price.However, for leases At the commencement or on modification of acontractthat containalease component, theGroup allocates the liabilities for mostof theseleases. ownership of theunderlyingassettoGroup. UnderIFRS16, theGroup recognises right-of-use assetsandlease leases basedonitsassessmentof whethertheleasetransferred significantlyall of therisks and reward incidentalto As alessee,theGroup leasesproperty andITequipment.TheGroup previously classifiedleasesasoperating orfinance As alessee using aweighted-average rate of 8%: When measuringleaseliabilitiesfor leasethat were classified asoperating lease,theGroup discountedleasepayments Discounted usingtheincremental borrowing rates at 1January 2019 Lease liabilities Deferred income Accruals Prepayments Opera Right-o

cluded initialdirect costsfrom measuringtheright-of-use assetat thedate of initialapplication.

Applied theex Ex Applied asinglediscountra ting lease commitments at 31 December 2018 ting leasecommitmentsat 31December2018 f-use assets emption nottorecognise right-of-use assetsandliabilitiesfor leaseswithlessthan12monthsof leaseterm. te toaportfolio of leaseswithsimilarcharacteristics.

13 £’000 £’000 Total Total 2,250 6,355 8,616 8,616 ,906 4 7

Group financial statements 123 124 10% higheror lower, theestimate wouldbe£180,000 higher or lower. the numberof bioprocessing batches actuallygoingoutof specification in future. If thehistoricalpercentage hadbeen process at year end. This estimate, basedon the historical percentage, may be significantly higher orlower depending on across theassessedperiodtorevenue recognised onbatches whichhave notyetcompletedthebioprocessing batches across thelastfour years,andhasappliedthepercentage of outof specification batches tototalbatches produced which theproduct isbioprocessed. Incalculating thisestimate theGroup haslooked at historicalrates of outof specification recognised andwhichmaybereversed should theproduct gooutof specification duringthe remaining periodover Group hasassessedtheneedtoincludeanestimate of bioprocessed product for whichrevenue haspreviously been As theGroup hasnowbeenbioprocessing product across anumberof years,andalsoin acommercial capacity, the as theprocesses are carriedout.Progress isdeterminedbasedontheachievementof verifiable stages of theprocess. Bioprocessing of clinical/commercial product for partnersisrecognised onapercentage of completionbasisovertime Provision for outof specification bioprocessing batches 10 percentage pointshigherorlower, revenue recognised intheperiodwouldhave been£540,000 higher or lower. the work packages which remain in progress at year end is £5,447,000. If the assessed percentage of completion was development work package. The value of the revenue recognised and the related contract asset raised with regards to such require judgementintermsof theassessmentof thecorrect percentage of completionfor that specificprocess fixed priceprocess developmentwork packages. Revenuesare recognised onapercentage of completionbasisandas As itsatisfies itsperformance obligations theGroup recognizes revenue andthe related contractassetwith regards to Percentage of completionof fixed priceprocess development revenues points higherorlower, revenue recognised intheperiodwouldhave been£2,086,300 higherorlower. batches whichremain inprogress at yearendis£20,863,000. Iftheassessedpercentage of completionwas10percentage batch. Thevalueof therevenue recognised andtherelated contractassetraisedwithregards tothebioprocessing assessment of thecorrect stageof completionincludingtheexpectedcostsof completionfor that specificbioprocessing process. Revenuesare recognised onapercentage of completionbasisandassuchrequire judgementintermsof the as theprocesses are carriedout.Progress isdetermined basedontheachievementof verifiablestages of thebioprocessing Bioprocessing of clinical/commercial product for partnersisrecognised onapercentage of completionbasis overtime Percentage of completionof bioprocessing batch revenues use (ROU)assetintheConsolidated Statement of financialpositions. and therate selectedfor eachleasewillhave animpactonthevalue of theleaseliabilityandcorresponding right-of- material differences withina reasonable range of sensitivities,judgementisinvolvedinselectinganappropriate rate, market specificfactors.Althoughwedonot expect ourestimates of theincremental borrowing rates togenerate to usbasedonthevalue,currency andborrowing termprovided byfinancialinstitutions,adjusted for companyand using previously available information onborrowing rates aswellindicative borrowing rates that wouldbeavailable in determiningthediscountrate usedtocalculate thepresent valueof leasepayments.Therates have beendetermined to theleasepaymentsinasimilareconomicenvironment) basedontheinformation available at commencementdate rate of interest that wewouldhave topay borrow onacollateralised basisoverasimilartermfor anamountequal Since therates implicit in our leasesare not readily determinable,weusethe Group’s incremental borrowing rates (the Lease liabilitydiscountrate those estimates. next financialyear, are discussedbelow. Thenature of estimation meansthat actualoutcomescoulddiffer from that have asignificantrisk of causingamaterial adjustmenttothecarryingamounts of assetsandliabilitieswithinthe The key assumptionsconcerningthefuture, andotherkey sources of estimation uncertaintyat thereporting date, Estimations annual report includingtheDirectors Report(page96)andNote1tothefinancialstatements (page114). concern status of theGroup. Theconclusionsof theseestimates andjudgmentsare reported inseveralplacesthis Management andthedirectors have hadtomake estimates andimportantjudgmentswhenassessingthegoing Going concern Judgments for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019

Oxford Biomedica plc|Annual report andaccounts2019 Trade debtorsare monitored tominimisethe riskof loss(note 17). least A,inline withtheGroup’s policytominimise theriskof loss. Cash balancesare mainlyheldonshort andmedium-termdepositswithfinancialinstitutions withacredit rating of at (c) Credit risks If interest rates hadbeen1%higherin2019 theimpactoncashinterest paidwouldhave been£215,000 (2018: £555,000). of £43.6 millionplusaredemption fee of £0.9 million,andthesecurityoverassets of theGroup wasremoved. financed through £53.5 million of equityissuedtoNovoHoldingsinMay2019. Theloanfacilitywasfully repaid at acost On 28June2019theGroup repaid its$55million(£43.6 million)loanfacilitywithOaktree CapitalManagement(“Oaktree”) of bankinterest rates, interest receivable onbankdepositsin2019wasjust£104,000 (2018:£71,000). to meetdayoperational requirements andpreserving thesecurityof investedfunds.Withthecurrent lowlevel The Group’s policyistomaximiseinterest receivable ondeposits,subjecttomaintaining accesstosufficientliquidfunds (b) Interest rate risk hedging of foreign currency cashflowsisundertaken. £343,000 (2018:£156,000). TheGroup’s policyistoholdthemajorityof itsfundsinSterling andUSDollars.Noother Euros. Hadthe£/€exchange rate been 10%different, theimpactoncostin2019wouldhave beenapproximately The Group also has exposure to the £/€ exchange rate due to the need to fund certain expenditure denominated in gain/loss of £4.3 million(2018:£4.1 million)onanyoutstandingloanbalance. impact of approximately £1,373,000 (2018:£3,054,000) overtheyearandwouldleadtoanunrealised foreign exchange for furtherdetailswithregards totheOaktree loan).A10%difference inthe£/$exchange rate wouldhave hadan finance costsandthecapital repayment whichtookplaceinJune2019were inDollars(please refer toInterest rate risk payable inEuros andUSDollars. Themajorityof operating costsare denominated inSterling butmostof theloan In 2019theGroup’s revenues were mostlyreceivable inSterling andUSDollars,certainof itsexpenditures were (a) Foreign exchange risk The Group doesnotusefinancial derivatives, anditistheGroup’s policynottoundertake any tradinginfinancialinstruments. The Group’s agreed policiesare implemented bytheChiefFinancialOfficer, whosubmits reports ateachboard meeting. Monitoring of financialriskispart of theBoard’s ongoingriskmanagement,theeffectiveness ofwhichis reviewedannually. The Group hasasimplecorporate structure withtheCompanyanditsonlyoperating subsidiarybothbeingUKdomiciled. Financial riskfactors 3. Financialriskmanagement recognised. Further detailisprovided inNote36. probable level that the full extent of any potential claim would be covered, therefore no contingent asset has been The Group have insurancecover, whichtheyintendtouse,howevertheGroup cannotbeconfident toahighly Accordingly, noprovision hasbeenmadeinrespect of thismatter. be brought againsttheGroup issubject toanumberof significantuncertaintiesandthesecannotbeestimated reliably. and thequantumtimingof anycashoutflows.Thelikely costtothegroup of anylitigation whichmaypotentially Considering thenature of thematter, there isaninherent judgementandalevelof uncertaintyintherevenue reversal of theGroup incurringaliabilityandtoevaluate theextenttowhichareliable estimate of anyliabilitycanbemade. possible outcomes, with the assistance of internal technical experts and external counsel,to determine the likelihood The Group are currently aware of apotentialclaimandare assessingthefactsandcircumstances surrounding the Estimate andjudgments:Potentiallitigation progress through thebioprocessing process. complete bioprocessing, althoughbatches bioprocessed in2020andbeyondwillbeincludedtheestimate asthey the corresponding credit tocontractliabilities(note20).Thisunrecognised revenue willberecognised asthebatches Consequently, bioprocessing revenue of £1.8 million(2018:nil)hasnotbeen recognised during2019(2018:Nil)with bioprocessing process at yearend. the historicassessmentperiod,butalsonumberof bioprocessing batches whichhave notyetcompletedthe The estimate will increase or decrease based on the number of bioprocessing batches which go out of specification over

Group financial statements 125 126 Net debt Revenue 2019 (i) Officer andChiefPeopleOfficer. TheSETmonitorsthe performance ofthe Groupintwobusinesssegments: Directors, Chief Medical Officer, Chief Technical Officer, Chief Scientific Officer, ChiefBusiness Officer, Chief Operations The chiefoperating decision-maker hasbeenidentifiedastheSeniorExecutive comprisingtheExecutive Team (SET), Segmental reporting 4. Segmentalanalysis Note 1:Represents Cashbalanceonlyasnodebt. Group in theperiodpriortorepayment of theloaninJune2020(2018:Nobreaches). to minimisethecostof capital.There have beennocovenantbreaches inrelation totheloanagreement during2019 order to provide returns to shareholders and benefits for other stakeholders, and tomaintain anoptimalcapital structure The Group’s objectiveswhenmanagingcapitalare tosafeguard theGroup’s abilitytocontinueasagoingconcernin Capital Management The fairvalueof shorttermdepositswithamaturity of oneyearorlessisassumedtobethebookvalue. Fair value estimates and hedgeaccountinghasnotbeenused. There were nomaterial derivatives at 31December2019or2018whichhave required separation, Derivative financialinstrumentsandhedging for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019 measure usedfor thepurposeof makingdecisionsaboutallocating resources andassessing performance of segments. Revenues, Operating EBITDA andOperating lossrepresent ourmeasures of segmentprofit &lossastheyare aprimary Revenues, otheroperatingincomeandlossbysegment (ii) Operating EBITDA Other operating income Equity Loss before tax Net financecost Operating (loss)/profit Change infairvalueof assetheldat fairvaluethrough profit andloss Depreciation, amortisation andshare basedpayment Debt/equity developments andtechnicalintellectualproperty withintheLentiVector undertaken for third parties(i.ethepartnerprogrammes CDMObusiness).Italsoincludesinternaltechnology Pla therapy products (genetherapeutics) whichare ownedbytheGroup. Pr gene and cell oduct –thissegmentconsistsof theclinicalandpre-clinical developmentof invivoandexgenecell tform –thissegmentconsistsof therevenue generating bioprocessing andprocess developmentactivities ¹ ® platform. Platform (20,166) (11,699) (6,584) 50,997 (1,883) £’000 884 – –

Product 13,063 £’000 5,699 6,458 (16,243) (759) 75,630 £’000 – – – – 2019 2019 21%

(20,889) (14,467) 64,060 £’000 (6,422) (1,883) (7,343) £’000 (5,241) 34,741 T 2018 8,909 otal otal 26% 884

Oxford Biomedica plc|Annual report andaccounts2019 Revenue 2018 in the table below is denominated in GBP and is generated in the UK. in thetablebelowisdenominated inGBPandisgenerated intheUK. Revenue isdisaggregated bythetypeof revenue whichisgenerated bythecommercial arrangement.Revenueshown Disaggregation ofrevenue reviewed bythechiefoperating decision-maker. Allassetsare located withintheUnitedKingdom. A segmentalorgeographicalsplitof assetsandliabilitiesisnotprovided becausethisinformation isnotreceived or operating decision-maker andtheoriginof allrevenues istheUnited Kingdom. A geographicalsplitof operating lossisnotprovided becausethisinformation isnotreceived orreviewed bythechief would have beenallocated tothePlatform segmentinsteadof theProduct segment. the Platform segment.Ifthesameapportionmentwasappliedretrospectively to2018, £1.5millionof additionalcosts more detailedapportionmentof thesecostswasmadeleadingtoagreater proportion of thecostsbeingallocated to a specifically are apportionedbetweenthesegmentsusing relevant metricssuchasheadcountordirect costs.In2019 Costs are allocated tothesegmentsonaspecificbasisasfarpossible.Costswhichcannot readily beallocated includes £nil(2018:£0.2 million)of partiallyfundeddevelopmentincome. develop oursupplychaincapabilitiesof £0.9 million(2018:£0.5 million)isincludedwithinthePlatform segment.2019 used tofundclinicalandpre-clinical developmentandisincludedwithintheProduct segment.Grantincometo Other operating income of £0.9 million (2018: £1.1 million) includes grant income of £nil (2018: £0.4 million) which is ting EBITDA (EarningsBefore Interest, Tax, Depreciation, Amortisation, revaluation of investmentsandAssetsat fairvaluethrougha profit &loss,andShare BasedPayments)is 1 2019 2018 development Bioprocessing/Commercial development development Bioprocessing/Commercial Operating EBITDA Other operating income Profit before tax Net financecost Operating profit Revaluation of investments Depreciation, amortisation andshare basedpayment Total Licence fees &Incentives Total Licence fees &Incentives options. Areconciliation toGAAPmeasures isprovided onpage42. non-GAAP measure often usedasasurrogate for operational cashflowasitexcludes from operating profit orlossallnon-cashitems,includingthecharge forshare basedpayments Opera ¹ Platform Platform Platform 504 11,774 55,004 50,997 55,004 39,034 (4,358) 15,970 11,368 £’000 £’000 £’000 45,715 5,983 5,282 9,743 645

Product Product Product 13,063 10,304 (1,090) 11,510 11,774 £’000 £’000 £’000 2,547 3,637 1,470 1,553 419 –

64,060 66,778 40,504 (5,448) £’000 £’000 £’000 (8,901) 26,274 47,268 66,778 13,380 16,792 13,915 T T T 5,983 1,064 5,014 otal otal otal otal otal otal

Group financial statements 127 128 Resear Employee benefitcosts Office andmanagement By activity The monthlyaverage numberof persons(includingexecutive directors) employedbytheGroup duringtheyearwas: 5. Employeesanddirectors Novartis, Axovant, Sanofi (Bioverativ) andOrchard Therapeuticseachgenerated more than10% of theGroup’s revenues. In 2019Novartis,Axovant andOrchard Therapeuticseachgenerated more than10%of theGroup’s revenues. In2018 The Companyhadnoemployeesduringtheyear(2018: zero). financial statements. director, isprovided intheauditedpartof theDirectors’ remuneration report on page80whichforms partof these Senior Executive Team. Further information abouttheremuneration of individualdirectors, includingthehighestpaid The key managementfigures aboveincludeexecutive andnon-executive directors andtheothermembers of the Key managementcompensation Revenue bycustomerlocation revenues derivepredominantly from Europe: The Group’s revenue deriveswhollyfrom assetslocated intheUnitedKingdom.Analysedbylocation theGroup’s Revenue bygeographicallocation for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019 Share basedpayments Other pensioncosts Social securitycosts Total employeebenefitcosts Share basedpayments(note28) Other pensioncosts(note32) Social securitycosts Total Total revenue Rest of world T and bioprocessing W W Eur otal ages andsalaries ages andsalaries ope ch, development ch, development

Number 64,060 46,602 27,438 33,627 17,458 4,984 £’000 £’000 £’000 2,861 3,417 1,769 1,559 2019 2019 2019 2019 2019 500 462 869 186 512 38

Number 20,444 25,236 25,265 £’000 £’000 £’000 66,778 41,542 2018 2018 2018 2018 3,267 4,813 1,278 1,132 2,411 350 788 186 572 377 27

Total Net lossonforeign exchange Operating leasepayments used inbioprocessing Raw materials andconsumables Impairment of intangibleassets Amortisation Employee benefitcosts and equipment Depreciation of property, plant Fees payablef by theGroup’sauditors provided Services

Oxford Biomedica plc|Annual report andaccounts2019 6. Financeincomeandcosts 7. Expensesbynature three monthLIBOR,subjecttoaminimumof 1%. Up to29June2019, interest payableconsistedof thecashinterest paid ontheOaktree loanfacilityat 9.0% plusUS$ of £43.6 millionplusaredemption fee of £0.9 million, and thesecurityoverassetsof theGroup wasremoved. financed through £53.5 million of equityissuedtoNovoHoldingsinMay2019. Theloanfacilitywasfully repaid at acost On 28June2019theGroup repaid its$55million(£43.6 million)loanfacilitywithOaktree CapitalManagement(“Oaktree”) Bank inter Finance income: Group as detailedbelow: During theyearGroup (includingitssubsidiaries)obtained servicesfrom theGroup’s auditorsandtheirassociates comprehensive income. Depreciation is charged to cost of goods, research and development, and bioprocessing costs in the statement of Biomedica UKLtd andrecharged totheCompany. Company employeebenefitcosts of £382,000 (2018:£365,000) relates tonon-executive costspaidbyOxford Unwinding o Finance costs: Fees payablefor otherservices: Revaluation of liabilitiesinforeign currency Total financeincome Interest payable Total financecosts Net financecosts and grantincomeaudits Audit related assuranceservices Review of interimresults Additional fees relating toprior yearaudit The auditof theCompany’ssubsidiaries est receivable f discountinprovisions (note22) or theauditof theparent companyandconsolidated financialstatements

Notes 12 11 5 33,627 13,374 £’000 5,765 (255) 2019 104 Group 22 – 25,265 (1,305) £’000 9,825 4,332 2018 30 25 – (6,422) (5,500) (6,526) £’000 (969) 2019 2019 £’000 £’000 2019 2019 104 104 (57) Company 330 345 165 Group 94 20 26 25 – – – – – –

(6,220) £’000 (8,901) (8,972) (2,744) £’000 £’000 2018 2018 2018 365 178 125 20 (8) 25 71 71 – – – – – – – 8

Group financial statements 129 130 Tax rate changes Recognition of previously unrecognised taxlosses Tax deductionfor share options lessthanshare optionaccountingcharge Total taxcreditfortheyear Adjustments inrespect of priorperiods Tax lossescarriedforward tofuture periods Chargeable gains Deferred taxnotrecognised Income nottaxable R&D relief mark-up onexpenses Expenses not deductible for tax purposes Expenses notdeductiblefor taxpurposes Effects of: by thestandard rate of corporation taxintheUKof 19%(2018:19%) (Loss)/profit onordinary activitiesbefore taxmultiplied (Loss)/profit onordinary activitiesbefore tax Current tax United Kingdomcorporation taxresearch anddevelopmentcredit Adjustments inrespect of priorperiods: Overseas taxation United Kingdomcorporation taxresearch anddevelopmentcredit Current tax Taxation Credit Deferred Tax (note24) Adjustments inrespect of priorperiods Relating totheorigination of timingallowances Deferred tax The amountsfor 2019have notyetbeenagreed withtherelevant taxauthorities. in thefinancialstatements butnotyet received isincludedincurrent taxassetsinthe Statement of financialposition. research anddevelopmentcredit ispaidinarrears oncetaxreturns have beenfiledandagreed. Thetaxcredit recognised credit receivable bytheGroup for theyearlessoverseastaxpaidinyear. TheUnitedKingdomcorporation tax amount includedinthestatement of comprehensive incomefor theyearended31December 2019comprisesthe The Group isentitledtoclaimtaxcredits intheUnitedKingdomfor certainresearch anddevelopmentexpenditure. The 8. Taxation for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019 Of theGroup taxlosses,£84.2 million(2018:£85.7 million)arose intheUnitedKingdom. At 31December2019, theGroup hadtax lossestobecarriedforward of approximately £84.2 million(2018:£85.7 million). are explainedbelow: The taxcredit for theyearishigher(2018:higher)thanstandard rate of corporation taxintheUK.Thedifferences The Companyhasnotaxliability, norisitentitledtotaxcredits (2018:£nil). tax receipt (£363,000), andanexpectedtaxrepayment relating toprioryears(£110,000). The adjustmentof current taxinrespect of prioryearof £473,000 (2018:£528,000) relates to alowerthananticipated (20,889) (2,434) (4,823) (3,969) £’000 (682) 2019 464 288 473 937 Group 20 47 33 – (1,880) (2,527) £’000 5,014 (963) (358) 2018 (387) 264 953 (32) (33) (91) – – (4,545) (4,823) (1,246) (5,018) (5,018) £’000 £’000 (278) (278) (937) 2019 2019 (237) Company (90) 160 473 770 Group – – – – – – – – – (2,806) (2,278) (2,278) (2,527) (1,575) (1,129) £’000 £’000 (299) (963) (528) 2018 2018 (312) (33) 279 133 – – – – – – – – – Net bookamountat31 December At 31 December Oxford Biomedica plc|Annual report andaccounts2019 The Companyhadnointangiblesat 31December2019or2018. Impairment charge for theyear Amortisation charge for theyear Intangible assetscompriseintellectualproperty rights. 11. Intangibleassets been includedinthesefinancialstatements. TheCompany’sloss for theyearwas£2,016,000 (2018:£446,000). As permittedbysection408of theCompaniesAct2006, theCompany’sstatement of comprehensive incomehasnot 10. Lossforthefinancialyear options andwarrantsoutstandingat 31December2018(69,242,901). by theweightedaverage numberof shares inissueduringtheperiodafter adjustingfor thedilutiveeffect of theshare The dilutedearningspershare inthepriorperiodof 10.89p hasbeencalculated bydividingtheearningsfor the period loss perordinary share andthedilutedlossperordinary share intheperiod. The Group madealossfor theperiodended31December2019. There istherefore nodifference betweenthebasic (72,709,944; 2018:65,188,414). for theperiodbyweightedaverage numberof shares inissueduringtheyearended 31December2019 The basiclosspershare of 22.10p(2018:earningsof 11.57p)hasbeencalculated bydividingthe(loss)/earnings share 9. Basicearnings / (loss)anddilutedearningsperordinary A Accumulated amortisationandimpairment Cost at31December Additions Cost at 1January t 1January £’000 5,636 5,636 5,541 5,519 2019 95 22 – – £’000 5,494 5,636 5,519 5,591 2018 117 45 25 –

Group financial statements 131 132 At 31December2019 Disposals At 31December2019 Disposals Reclassification Reclassification At 31December2018 Disposals Charge for theyear Additions at cost Charge for theyear Additions at cost Adoption of IFRS16(Leases) Adoption of IFRS16(Leases) A Accumulated depreciation At 31December2018 Disposals 2. 1. The Companyhadnoproperty, plantandequipmentat 31 December2019or312018 to another. is equipmentwepurchase for ourlaboratory andbioprocessing processes andare generallymovablefrom onefacility Leasehold improvements are capitalimprovements tobuildingswhichwelease.Bioprocessing andLaboratory equipment Net bookamountat31 December2018 Net bookamountat31 December2019 A Accumulated depreciation 12. Property, plantandequipment for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019 A Cost A Cost t 1January2018 t 1January2018 t 1January2019 t 1January2019 bioprocessing facility. Included withinLeaseholdimpr on thenature of therestoration provision. The adoptiono f IFRS16(Leases)at thestartof 2019required therestoration provision tobereclassified asaright of useasset.Refer note22 for furtherinformation ovements are Assets-under-construction of £17,590,000 (2018:£2,396,000), representing ongoingconstructionworks at theOxbox Freehold Freehold property property 1 21,283 13 14721,908 21,427 21,283 21,171 8,360 £’000 £’000 4,959 6,324 4,306 2,036 6,324 2,018 0720,229 ,067 144 112 – – – – – – – improvements improvements Leasehold Leasehold Leasehold (1,263) 15,436 3,046 £’000 £’000 6,285 1,450 4,689 1,679 1,450 7,735 7,735 978 472 188 417 – – – – – 1 1

equipment and equipment and equipment and equipment and computers computers Office Office Office Office £’000 £’000 ,8 12,337 5,088 3,054 5,088 ,4 3741,6 61,932 10,561 13,734 4,341 2,416 2,672 1,909 ,9 0141,0 82,304 11,400 20,174 7,395 1,862 2,681 2,416 3,179 (239) (374) 554 877 – – – – – and Laboratory and Laboratory and Laboratory and Laboratory Bioprocessing Bioprocessing Bioprocessing Bioprocessing equipment equipment 12,337 6,440 £’000 £’000 4,462 5,686 4,462 1,288 7,875 6,651 1,784 3,174 7,513 (50) 239 (45) 374 – – – – Right of use Right of use . £’000 asset ,8 29,556 3,782 7,618 3 20,372 839 188 651 – – – – – – 2

46,443 35,690 46,443 14,652 10,320 31,791 14,652 10,753 £’000 £’000 4,332 6,355 5,765 Total Total (50) (45) – – – – – Oxford Biomedica plc|Annual report andaccounts2019 A Accumulated impairment Total investmentsinsharesandloanstogroupundertakings At 31December Loan advancedintheyear A Loans togroupundertakings 15. Investmentsandloansinsubsidiaries 13. Assetsatfairvaluethroughprofitandloss At 31December Change infairvalueof available-for-sale asset At 31December Sale of shares Costs tosellassetat fairvaluethrough profit andloss Reclassification of investmentasasset at fairvaluethrough profit andloss(note 14) Revaluation of investments Recognition of milestones Reclassification of investmentasassetheld at fairvaluethrough profit andloss(note13) At 1January held at fairvaluethrough profit andloss(non-current assets)toAssets at fairvaluethrough profit &loss(current assets). an Assetat fairvaluethrough profit &lossunderIFRS 5. Assuch,theequityinvestmentwas reclassified from Investments During thefirsthalf of 2019theGroupof determinedthat theequityheldinOrchard Therapeuticsmetthedefinition 14. Investmentsheldatfairvaluethroughprofitandloss At 1January Assets atfairvaluethroughprofitandloss:Group Total investments At 31 December Additions intheyear(note26) A Capital contributioninrespectofemployeeshareschemes Net bookamountat31 December A Shares ingroupundertakings t 1January t 1January t 1 January and31December t 1January t 1 January and 31December t 1January (10,966) 263,334 126,065 248,152 194,736 146, 137,269 (6,270) (1,883) 10,966 10,966 53,416 15,182 £’000 £’000 £’000 9,492 1,559 2,719 7,933 2019 2019 2019 (94) 761 – – – – 209,918 126,065 194,736 176,432 83,853 18,304 10,966 91,786 15,182 £’000 £’000 £’000 2,029 2,954 5,983 6,801 7,933 1,132 2018 2018 2018 – – – – – – –

Group financial statements 133 134 Oxxon TherapeuticsLimited Oxford Biomedica(UK)Limited production orsoldonwards. The Companyholdsnoinventories. During theyear, theGroup wrote down£171,000 (2018:£288,000) of inventorywhichisnotexpected tobeusedin statement of comprehensive income. to more accurately bemeasured, leadingtotheWork-in-progress balancebeingrecognised ascostof salesinthe that during2019theGroup changeditsmethodof calculating thepercentage of completiononbioprocessing batches related to contractualbioprocessing obligations. The Group has no Work-in-progress at the end of 2019 due to the fact Inventories constituterawmaterials heldfor commercial bioprocessing purposes,andwork-in-progress inventory Total inventory Work-in-progress Raw Materials Group 16. Inventories required. Cumulative impairment of £126.0 millionhasbeenrecognised upto31December2019. for thispurpose.Followinganimpairmentreview at 31December2018noimpairment charge wasassessedtobe that reference tothemarket capitalisation of the Group isanappropriate externalmeasure of thevalueof theGroup out inIAS36, andthecarryingvalueof theCompany’sinvestmentsinsubsidiariesisadjusted.Thedirectors consider resulting inadecrease inmarket capitalisation, thedirectors considerthistobeatriggerof animpairmentreview asset material andsustainedshortfallinthemarket capitalisation, orasignificantandsustainedchangeinthebusiness At each yearendtheDirectors review thecarryingvalueof theCompany’sinvestmentinsubsidiaries.Where there isa All of theabovesubsidiarieshave beenconsolidated inthesefinancialstatements. settle the2013deferred bonusshare awards madetoexecutive directors andemployees(Note27). In addition,theGroup setuptheOxford BiomedicaEmployee Benefit toholdmarket-purchased sharesTrust (EBT) to The registered office ofbothsubsidiariesisWindrushCourt, Transport Way, Oxford, OX4 6LT. undertakings Interests insubsidiary due for repayment within12monthsof theyearend. The loanfrom Oxford BiomedicaplctoOxford Biomedica(UK)Limitedisunsecured andinterest free. Theloanisnot parent company. company makes upalmostallof thevalue,considerablyexceeds thevalueof theloanandinvestmentmadeby to group undertakings as the market value of the Group, of whichOxfordBiomedica (UK) Ltd. as theoperational The application of theexpectedcredit lossmodelhashadnosignificantimpactonthelevel of impairment of theloan for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019 incorporation Gr Great Britain Country of Country of eat Britain 1p ordinary shares 1p ordinary shares Description of Description of shares held

Pr of issued shares held by the of issuedshares heldbythe oportion of nominal value oportion of nominalvalue Group andCompany 100% 100% Gene therapy research Gene therapyresearch £’000 2,579 2,579 2019 Nature of business and development – Dormant £’000 2,422 1,829 4,251 2018

Oxford Biomedica plc|Annual report andaccounts2019 17. Trade andotherreceivables 60+ days 30–60 days 0–30 days Ageing of pastduebutnotimpaired tradereceivables: of deposits heldinescrow aspartof theWindrushInnovation Centre andOxbox leasearrangements. Non-current tradeandotherreceivables constituteotherreceivables of £3,605,000 (2018:£4,000,000) whichconsists the periodwouldhave been£54,000 higherorlower. is £5,447,000. Iftheassessedpercentage of completionwas1percentage point higherorlower, revenue recognised in completion for that specificworkpackage. Thevalue of thecontractassetraisedwith regards totheseworkpackages percentage of completionbasisandassuchrequires estimation intermsof assessmentof thecorrect percentage of A portionof contractassetsrelates tofixed priceprocessa developmentworkpackages which are recognised on when therightsbecomeunconditional.ThisusuallyoccursGroup issuesaninvoicetothecustomer. for Commercial Development work and Bioprocessing batches. The contract assets are transferred to receivables Contract assetsrelates totheGroup’s rightstoconsideration for workcompletedbut notbilledat thereporting date which were pastdueat thereporting date andof which£5,450,000 hasbeenreceived after thereporting date. Included intheGroup’s tradereceivable balanceare debtorswithacarryingamountof £7,472,000 (2018: £1,768,000) on thelevelof impairmentof receivables. under IFRS9andhave concludedthat theapplication of theexpectedcredit lossmodelhashadanimmaterial impact The fair value of tradeand other receivables are the current book values. We have performed an impairment assessment does notholdanycollateral as security. The maximumexposure to credit risk at thereporting date is the fairvalueof eachclassof receivable above.TheGroup US Dollar Sterling The carryingamountsof theGroup’s tradeandotherreceivables are denominated inthe following currencies: completes. development workorders accruedonapercentage completebasiswhichwillbeinvoicedastherelated workpackage which have been accrued as the specific conditions stipulated in the license agreement have been met,andcommercial third parties,butwhichhas notyetbeeninvoiced.Thebalancemainlyrelates tocommercial developmentmilestones Contract assetsof £13.4 million(2018:£8.9 million)ariseswhere workhasbeenundertaken whichisrecoverable from Total tradeandotherreceivables Prepayments Other taxreceivable Other receivables Contract assets Trade receivables Current 30,045 13,406 12,766 £’000 1,537 1,773 2019 563 Group 26,585 15,408 £’000 8,886 1,144 2018 840 307 33,650 25,939 £’000 £’000 £’000 6,330 1,142 7,472 7,711 2019 2019 2019 Company – – – – – – – 28,098 30,585 £’000 £’000 £’000 2,487 1,768 1,768 2018 2018 2018 – – – – – – – –

Group financial statements 135 136 The Companyhadnocontractliabilitiesordeferred incomein2019or2018. assets are depreciated. of theOxbox bioprocessing facilityexpansion. Theincomewillrecognised overtheperiodwhichpurchased Deferred incomerelates tograntfundingreceived from theUKGovernmentfor capitalequipmentpurchased aspart (2018: Nil)relating totheestimate of outof specification batches (refer note2:’Estimates’ for additionalinformation). Included within bioprocessing contract liabilitiesis revenue £1.8 million which has not been recognised during 2019 Years be released astherelated performance obligations are satisfied overtheperiodasdescribedbelow: Contract liabilitiesconsistsprimarilyof deferred bioprocessing andprocess developmentrevenue, andare expectedto performance obligation wassatisfied andthebatches manufactured. end of 2019duetotherecognition of process developmentincomeandcapacityreservation revenues asthe Contract liabilitiesanddeferred incomehave decreased from £18.5 millionat theendof 2018to£14.9 millionat the of completion of theservicesbeingprovided. Contract liabilities and deferred income arise when the Group has received paymentfor services in excess of the stage 20. Contractliabilitiesanddeferredincome 19. Trade andotherpayables 18. Cashandcashequivalents for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019 Grant Lease incentives Deferred Income Licence fees andincentives Process developmentincome Bioprocessing income Contract liabilities Total tradeandotherpayables Accruals Other taxation andsocialsecurity T Cash at bank and in hand Cash at bankandinhand rade payables 31677928 707 13,156 £’000 ,8 675 8,380 4,760 ,0 ,9 1,318 1,318 1,992 1,992 1,006 1,006 0–1 16 –

16,243 14,297 £’000 £’000 5,944 1,042 £’000 7,311 2019 2019 1–3 Group Group 2928 32 – –

32,244 11,422 £’000 £’000 £’000 6,906 3,746 2018 2018 3–5 770 – – –

£’000 £’000 £’000 2019 2019 5–10 Company Company 109 109 60 60 – – – – – – – 2

14,851 £’000 £’000 4,760 9,055 1,036 4,316 4,316 T 2018 2018 otal 164 164 11 – – – Oxford Biomedica plc|Annual report andaccounts2019 22. Provisions The Oaktree facilitywassecured byapledgeoversubstantiallyallof theGroup’s assets. relating totheachievementof revenue targets andarequirement toholdaminimumof $2.5millioncashat alltimes. issued 2,689,686 (postconsolidation) warrantstoOaktree (note30).Thetermsalsoincludedfinancialcovenants 0.25% inthethird year. Theloanwasissuedat anoriginaldiscountof 2.5%,andundertheagreement theCompanyhas Subject to achieving certain conditions, the interest rate could have reduced by 0.25% inthe second year and a further Prior torepayment theloancarriedaninterest rate of 9.0% plusUS$three monthLIBOR,subjecttoaminimumof 1%. costs inthestatement of comprehensive income,andthesecurityoverassetsof theGroup wasremoved. repaid at a cost of £43.6 million plus a redemption fee of £0.9 million which forms part of interest payable within finance (“Oaktree”) financedthrough £53.5 million of equityissuedtoNovoHoldingsinMay2019. Theloanfacilitywasfully On 28June2019theGroup repaid its$55million(£43.6 million)loanfacilitywithOaktree CapitalManagement 21. Loans Total provisions Non-current The Companyhadnoprovisions at 31December2019or 2018. recognised at theendof 2019for thecostof restoring thisproperty toitsoriginalconditionat theendof theleaseterm. warehousing andqualitycontrol laboratories, withspaceavailable for future expansion.Aprovision of £3,741, 000was around 45,000 sq.ft(4,200 sqm)for four GMPcleanroom suitesandtwofillfinishaswell offices, Oxford, UK.Thenewfacilityis84,000 sq.ft(7,800 sqm). TheGroup’s PhaseIandplanned2expansionwillfitout In 2018theGroup signed the leaseonitsOxbox bioprocessing facilityinOxford neartoitsWindrushlaboratories in in 2018. Theprovisions willbeutilisedat theendof theleasesiftheyare notrenewed. 2028 respectively, discountedusingtherate pertheBankof Englandnominalyieldcurve. Theequivalentrate wasused Innovation Centre properties inOxford, UKtotheiroriginalconditionat theendof theleasetermsin2024, 2033and The dilapidations provisions relate toanticipated costsof restoring theleaseholdYarnton, Oxbox andWindrush Current At 31December Additional provision recognised New provision Unwinding of discount At 1January £’000 £’000 5,086 5,086 5,086 1,287 3,741 2019 2019 58 – – £’000 £’000 1,,287 1,287 1,287 2018 2018 649 630 – – 8

Group financial statements 137 138 Trade andother payables Trade receivables and and loss(note13) Assets at fairvaluethrough profit Loans (note21) profit andloss(note15) Investments at fairvaluethrough Cash andcashequivalents(note18) US Dollars Sterling other receivables (note17) US Dollar Sterling The carryingamountsof theGroup’s cashandequivalentsare denominated inthefollowing currencies: The directors considerthat thefairvaluesof theGroup’s financialinstrumentsdonot differ significantly fromtheirbookvalues. Fair value and are assuchassessedhaving alowriskof default. Other receivables are rent depositstoheldinseparately administered bankaccountswith covenantslimitingtheiruse The openingandclosingpositionwaslow(2018:low). no reconciliation betweenthe2018and2019closingdebtorbalance assessedbyriskof defaulthasbeenprovided. reserves tosatisfy theirobligations. There hasbeennochangeinthedeterminedriskduring2019, therefore groups inthetop10worldbymarket capitalisation, andbyBiotechnologycompanieswithsufficientcash All tradereceivables are assessedashaving alowcredit riskrating asthedebtisowedbybluechippharmaceutical Cash andcashequivalentsare heldwithreputable banks withalowassessedriskof default. Assessment offinancialassetsbycreditriskrating: Floating rate instantaccessdepositsearnedinterest at prevailing bankrates. excluding tax(note19) The Group hadthefollowing financialinstruments at 31Decembereachyear: note 3relating toriskmanagement. loans, andtradeotherpayables.Additionaldisclosures are setoutinthecorporate governancestatement andin The Group andCompany’sfinancialinstrumentscomprisecashequivalents,tradeother receivables, 23. Financialinstruments for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019

value throughprofit&loss Financial assets at fair Financial assetsatfair £’000 2,719 2,719 2019 – – – – – 10,966 10,966 £’000 2018 – – – – – 48,120 16,243 31,877 £’000 receivables 2019 Cash & Cash & – – – –

32,2 29 61,525 £’000 2018 ,281 44 – – – – Year average average rate Amortised costs, loans Amortised costs,loans Weighted Weighted & otherliabilities 16,243 10,789 13,255 13 0.55% 1.62% £’000 £’000 5,454 2019 2019 2019 ,255 – – – – – Year average average rate Weighted Weighted 28,684 32,244 51,805 10,652 41,153 0.48% £’000 £’000 3,560 1.45% 2018 2018 2018

– – – –

At 31December 2018 Origina At 1January2018 At 31December2019 Origina At 1January2018 At 31December2019 Origination andreversal of temporarydifferences Oxford Biomedica plc|Annual report andaccounts2019 Origina At 1January2019 Deferred tax(assets)/liabilities–notrecognised Company –recognised At 31December2018 At 1January2019 Deferred tax(assets)/liabilities–recognised Group –recognised to 17%witheffect from 1April2020. The mainrate of corporation taxintheUKreduced from 20%to19%witheffect from 1April2017andwill reduce further accordingly andincrease therecognised deferred taxassetandliabilityby£42,000 respectively. change wassubstantivelyenactedon17March 2020. Thiswillincrease thecompany’sfuture current taxcharge The March 2020 Budget announced that a rate of 19% would continue to apply with effect from 1 April 2020, and this 6 September2016, andtheUKdeferred taxasset/(liability)asat 31December2019hasbeencalculated basedonthisrate. A reduction intheUKcorporation taxrate from 19%to17%(effective 1April2020) wassubstantivelyenactedon a future taxablegainonthesaleof theOrchard investmentasset. therefore adeferred taxassethasbeenrecognised onlytotheextentthat there isadeferred taxliabilityintheform of 2018. Inlightof theGroup’s historyof losses,recovery of thewholedeferred taxassetisnotsufficientlycertain,and The CompanyandtheGroup have recognised deferred taxassetsandliabilitiesat2019 and31December 31December 24. Deferredtaxation Reconciliation inliabilitiesfromfinancing activities and loss.Pleaserefer tonote13(2018:14) for furtherinformation. The investmentassetrepresented byordinary shares inOrchard Therapeuticsisclassifiedas at fairvaluethrough profit Financial assetsclassifiedaslevel1inhierarchy At 31December(note19) Oaktree loanrepayment At 1January Redemption fee Cash interest paid Foreign exchange movement Interest payable tion andreversal of temporarydifferences tion andreversal of temporarydifferences tion andreversal of temporarydifferences Tax losses Tax losses (1,129) 119 ,0 279 1,408 (1,129) (1,129) 119 ,0 279 (1,129) 1,408 (1,129) 1, (1,129) £’000 £’000 (359) 359 (359) 7 109 (279) (1,049) 770 770 – – Revaluation of Revaluation of Revaluation of investments investments (43,589) (2,486) 41,153 £’000 4,819 £’000 £’000 (866) 2019 969 0 279 408 – – – – – – – – 36,864 (4,665) (1,129) (1,129) (1,129) 41,153 £’000 £’000 £’000 6,210 2,744 (359) 2018 Total Total 770 – – – – –

Group financial statements 139 140 Costs associated withtheissueof shares At 1January Group andCompany 26. Sharepremiumaccount consolidated ordinary shares of 50penceeach. On 30May2018, Oxford Biomedicaconsolidated itsexistingordinary shares of 1pence eachto65,701,073 new of £6.90 on29May2019. Gross proceeds from theplacingwere £53.5 million;netproceeds were £52.8 million. of £6.90. NovoHoldingsalsoexercised infullitsoptiontosubscribeafurther1,181,976 newordinary shares at aprice On 28May2019, theGroup announcedthat NovoHoldingshad subscribedto6,568,024 newordinary shares at aprice Proceeds from theshares issuedwere £1.3million. In April2019, Oaktree exercised itswarrantswhichwere thenconvertedinto2,689,686 ordinary shares of 50peach. for consolidation) shares Allotted onexercise of share options–315,917 (2018:462,507adjusted At 1January–66,103,528 (2018:62,154,084 postconsolidation) shares sharesof50peach Ordinary Issued andfullypaid Group andCompany shares 25. Ordinary At 31December2018 Origination andreversal of temporarydifferences Premium onexercise of share options Premium onexercise of warrants Premium onshares issuedfor cashinplacingandsubscription Allotted onexercise of warrants–2,689,686 (2018:Nil)shares Allotted for cashinplacingandsubscription–7,750,000 (2018:3,486,936) shares At 1January2018 At 31December2019 Origination andreversal of temporarydifferences At 1January2019 Deferred tax(assets)/liabilities–notrecognised Group –notrecognised for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019 At 31December–76,859,131 (2018:66,103,528) shares At 31December

depreciation (1, £’000 76 18 1,2)(,1)(19,164) (1,712) (16,528) (138) (786) 76 18 (16 (138) (786) 7)(3)(638 18 (17,730) (148) (16,378) (133) 071) 6)(4)(702 164 (19,259) (1,664) (17,092) (441) (62) 285 724 Tax Tax Provisions £’000 33 (564) (303) 5 10 154 (1,434) (1,564) (150) (5) Tax losses £’000 58 172 (19,164) (1,712) ,528) Share options 222,618 172,074 49,600 33,034 38,416 £’000 £’000 £’000 1,345 3,875 1,218 (769) 2019 2019 495 162 8(95) 48 154,224 172,074 33,034 31,076 18,748 (1,376) £’000 £’000 £’000 2018 2018 1,712 Total 246 478 – – Oxford Biomedica plc|Annual report andaccounts2019 after whichtheoptionsexpire. Optionscannotbeexercised before thethird anniversaryof thedate of grant. date of grant.Theyare notsubjecttomarket conditionperformance criteriaandthelivesof theoptionsare tenyears, Options grantedunderthe2015Save AsYou EarnSchemehave fixed exercise pricesbasedonthemarket price at the third anniversaryof thedate of grant. years, after whichtheoptionsexpire. Optionsgrantedunderthe2015Schemecannotnormallybeexercised before the at the date of grant.Theyare notsubjecttomarket conditionperformance criteriaandthelivesof theoptionsare ten Options grantedunderthe2015Executive Share OptionSchemehave fixed exercise pricesbasedonthemarket price of 25% from the firstto fourth anniversaries of thegrantdates. the date of grant.Optionsgrantedunderthe2007Schemeduring2012to2014, withoneexception, vestintranches which theoptionsexpire. Optionsgrantedpriorto2012cannotnormallybeexercised before thethird anniversaryof of grant. Theyare notsubjecttomarket condition performance criteriaandthelivesof theoptionsare tenyears, after Options grantedunderthe2007Share OptionSchemehave fixed exercise pricesbasedonthemarket price at thedate at either paroranilcostonthethird anniversaryof thedate of grant,andlapse10yearsafter being granted. The performance criteriaare describedintheDirectors’ remuneration report. LTIP awards made todate are exercisable granted optionslapsing. criteria have beenmet.Failure tomeettheminimumperformance criteriabythethird anniversaryresults inallthe and market condition performance criteria and will vest only if, at the third anniversary of the grant, the performance Options grantedunderthe2007and2015LTIPs todirectors andotherseniormanagersare subjecttobothrevenue All optiongrantsare at thediscretion of theRemuneration Committee. Incentive Plans(LTIP), andtootheremployeesundertheShare OptionSchemesandSave AsYou EarnScheme. Share options are grantedtoexecutive directors andselectedseniormanagersundertheCompany’sLongTerm — — — — — — — The Companyhasoutstandingshare optionsthat were issuedunderthefollowing schemes: 27. OptionsoversharesofOxfordBiomedica plc

The 2015Sa The 2015Def The 2013Def The 2015LongT The 2007LongT The 2015Ex The 2007Shar ve AsYou EarnScheme(approved May2015). ecutive Share OptionScheme(approved May2015). erred Bonus Plan(approved May2015). erred Bonus Plan(approved February2014). e OptionScheme(approved February2007). erm IncentivePlan(LTIP) (approved May2015). erm IncentivePlan(LTIP) (approved February2007).

Group financial statements 141 142 Note 2–Optionsgrantedunderthe2015LTIP. Note 1–TheseLTIP awards willvestprovided that performance conditions specifiedintheDirectors’ remuneration report are met.

Options grantedundertheOxfordBiomedica2007and2015LongTerm Incentive Plans Options grantedtoemployeesundertheOxfordBiomedica2015Save AsYou EarnScheme Note 1–Optionsgrantedunderthe2015Executive share optionscheme. Options grantedtoemployeesundertheOxfordBiomedica2007and2015ShareOptionSchemes Share options outstandingat 31December2018have thefollowing expirydate andexercise prices: for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019 2019 Numberofshares 2019 Numberofshares 2019 Numberofshares 1,284,765 3,010,660 1,240,962 298,323 305,360 459,586 218,181 130,794 191,195 237,104 484,933 122,344 268,781 142,000 69,768 66,864 113,158 34,302 73,443 13,608 24,525 75,845 89,082 66,679 9,718 – – – – 1,2 1,2 1,2 1 1 1 1 1 2

08Nme fsae xriepieprsaeDate from whichexercisable Exercise pricepershare 2018 Numberof shares 08Nme fsae xriepieprsaeDate from whichexercisable Exercise pricepershare 2018 Numberof shares 08Nme fsaeEecs rc e hr Date from whichexercisable Exercise pricepershare 2018 Numberof share 2, 1,028,263 231,256 1,057,559 196,912 449,380 363,558 340,995 144,466 178,909 271,506 221,256 142,000 101,757 114,731 27,078 113,158 77,283 93,349 22,406 40,314 72,679 47,114 12,211 – – 1,2 1,2 – – – –

2 1 1 1 1 100p to200p 270p to290p 618p to 705p 04/01/2022 to 12/9/2022 04/01/2022 to12/09/2029 04/01/2022 to12/9/2022 04/01/2022 618p to705p 115p to155p 0 o94 50/08t 70/0115/02/2028to07/08/2028 15/02/2018to07/08/2021 502 to904p 80p to140p 490p 290p 495p 330p 305p 422p 310p 275p 725p 145p 50p 50p 50p 50p 0p 0p 0p 0p 0p 80/02t 2922 18/04/2029to12/09/2029 18/04/2022 to12/9/2022 50/01t //0115/02/2021to7/8/2021 15/02/2021 to7/8/2021 17/07/20 to25/09/20 09/10/22 13/07/20 12/10/20 01/10/18 10/10/21 13/10/19 Vested Vested Vested Vested Vested Vested Vested Vested Vested Vested Vested Vested Vested Vested 13/03/25 to10/06/25 03/06/24 to17/10/24 08/05/22 to21/12/22 16/05/26 to13/10/26 17/07/27 to25/09/27 15/03/21 to04/10/21 22/05/23 to19/11/23 20/6/24 to17/10/24 Expiry date Expiry date Expiry date 09/04/23 30/06/22 10/04/22 12/04/20 16/05/26 01/04/19 12/06/23 25/03/19 10/01/25 12/04/21 13/07/27 13/10/18 13/10/18 Oxford Biomedica plc|Annual report andaccounts2019 options that were abovewater, basedontheyear-end share priceof 645p(2018:707p)pershare. £529,000 (2018:£437,000) isincludedinaccrualsfor thepotentialNIliability accruedto31Decemberonexercisable Certain optionsgrantedtoUKemployeescouldgiveriseanational insurance(NI)liabilityonexercise. Aliabilityof National insuranceliability Options grantedtoemployeesundertheOxfordBiomedica2013and2015DeferredBonusPlan The optionsgrantedunderthe2015Deferred BonusPlanwillbesatisfied bynewissueshares at thetime of exercise. shares (2018: nil)from theEBTwere exercised. The EBT is consolidated at year end with theshares held in trust until the exercise of theoption. During the year no Oxford BiomedicaEmployeeBenefit As at 31December2019,Trust (EBT). allshares heldbytheEBThadvested. The optionsgrantedunderthe2013Deferred BonusPlanwillbesatisfied bymarket-purchased shares heldbythe dependent ontheoptionconditions.Optionswithavalueof £385,000 vestedduring2019(2018:£267,000). dates andare exercisable at nilponeitherthefirstthree anniversaries of thegrantorthird anniversary of thegrant options. Theseoptionswillvestprovided that themanagersare stillemployedbytheGroup oncertainspecifiedfuture The executive directors andcertainotherseniormanagershave beenawarded deferred bonusesintheform of share Deferred ShareAwards 2019 Numberofshares 427,866 48,422 86,320 53,900 66,592 78,907 93,725 08Nme fsae xriepieprsaeDate from whichexercisable Exercise pricepershare 2018 Numberof shares 379,209 116,723 53,900 48,422 78,907 81,257 – 0p 0p 0p 0p 0p 0p 18/04/20 to18/04/22 07/08/19 to07/08/21 11/07/18 to11/07/20 11/07/18 Vested Vested Vested 15/06/24&14/10/24 Expiry date 07/08/28 04/05/25 18/04/29 14/05/26 11/07/27

Group financial statements 143 144 (Model used:BlackScholes) Share options (Model used:BlackScholes) Save AsYou Earnschemeawards 28. Sharebasedpayments for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019 (Model used:MonteCarlo) LTIP awards Fair valueperoption Risk free rate (weightedaverage) Expected life (years) Expected volatility (weightedaverage) Total numberof shares underoption Vesting period(years) Exercise price Shar Shar Shar Exercise price Exercise price Vesting period(years) Vesting period(years) Total numberof shares underoption Total numberof shares underoption Expected volatility (weightedaverage) Expected volatility (weightedaverage) Expected life (years) Expected life (years) Risk free rate (weightedaverage) Risk free rate (weightedaverage) Fair valueperoption Fair valueperoption e priceat grantdate e priceat grantdate e priceat grantdate

Options awar L TIPs awarded TIPs awarded 04 Jan2019 18 Apr2019 659.24p 235.38p 262,031 516.87p 53.36% 54.73% 19,113 0.76% 0.77% 645p 665p ded 0p 3 3 3 3

Options awar L TIPs awarded TIPs awarded 01 May2019 18 Apr2019 230.37p 539.52p 469,710 53.60% 53.60% 704.6p 20,647 0.77% 0.77% 696p 665p ded 0p 3 3 3 3

Options awar Options awar L TIPs awarded TIPs awarded 09 Oct2019 12 Sep2019 12 Sep2019 552.00p 421.80p 421.68p 515.00p 210.48p 270,915 617.86p 50.56% 50.71% 50.71% 169.62 30,751 10,561 0.46% 0.46% 0.27% 552p ded ded ded 0p 3 3 3 3 3 3

350p+ 250p to350p 150p to250p 50p to150p Options: Oxford Biomedica plc|Annual report andaccounts2019 Exercisable at 31 December LTIP awards (optionsexercisable atparvalue 1pornilcost) exercise priceat 31 December all of whichrelated toequity-settledshare basedpaymenttransactions. The totalcharge for theyearrelating toemployeeshare-based paymentplanswas£1,559,000 (2018:£1,132,000), 315,917 optionswere exercised in2019(2018:462,507),including14,664 of deferred bonusoptions(2017:53,174). price for optionsgrantedduringtheyearwas597.8p (2018:850.1p). Excluding theLTIP andDeferred Bonusawards whichare exercisable at par/nilvalue,theweightedaverage exercise year, togetherwiththerelated weightedaverage exercise prices. The tablesbelowshowthemovementsinShare OptionScheme,Save AsYou EarnSchemeandtheLTIP duringthe Exercisable at 31 December Range ofexercise prices Share optionsexcluding LTIP Outstanding at 31 December Outstanding at 31 December Exercisable at parorat nilcost Deferred bonus: Exercisable at parorat nilcost L Outstanding a Outstanding a Exercisable andwhere market priceexceeds Exercised Forfeited Share consolidation Granted Granted Cancelled Expired Exercised Exercised Share consolidation Granted Forfeited Exercised Cancelled TIP: t 1January t 1January

Weighted Weighted exercise exercise average average 2p1,416,444 628p price 8p27,881 180p 9p213,955 293p 2p111,418 129p 2 1,240,962 12p p427,866 0p 1, 1,421,117 (253,718) (125,373) (42,627) Number 769,698 349 349 770,299 3,438,526 of shares Number Number ,579 ,579 – – – – – Weighted average Weighted average exercise price Contractual life (years) life (years) remaining remaining 1,240 1,028,263 (45,874) (54,856) Number 313,429 533 419.2p 602.8 243.0 654.9 548.7 673.8 263.1 263.1 2019 2019 2019 ,962 ,263 6.8 6.6 6.6 5.6 8.7 3.7 – – – – –

W exercise exercise average average eighted eighted 9p337,828 290p 5p828,989 659p price 3p215,881 132p 7p38,419 175p (59,795,959) 5 1,028,263 15p 65,260,044 p379,209 0p (2,056,185) (2,174,134) (180,674) 1,421,117 (149,191) 250,880 250,880 Number 386,029 (28,985) 166,857 (6,685) 2,828,589 of shares Number Number 1 W Weighted average eighted average eighted average exercise price (52,918,024) Contractual 54,297,969 remaining remaining life (years) (300,000) 1,028,263 (213,018) Number 204,147 421,186 (42,811) 474.9p 633.4p 299.7p 299.7p 419.2p 337.7p 156.1p 10.5p 2018 2018 2018 6.7p 8.0p 6.8p 5.8p 3.3p 8.8 6.8 6.9 4.4 8.1 7.5

Group financial statements 145 146 At 31 December Vesting of deferred share award Share basedpayments Profit/(Loss) for theyear A At 31December2018 Issue of warrants At 31December2019 Exercise of warrants 29. Accumulatedlosses for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019 At 1January2019 Group 30. Otherreserves 31 December2018. Neither theCompanynoritssubsidiaryundertakingshadreserves available for distributionat 31December2019or – 1 Note was released toshare premium. consideration of £1,344,843. Theexercise price of thewarrantswas50pperwarrant.Uponexercise thewarrantreserve On 18April2019, Oaktree exercised itswarrantsrepresenting 2,689,686 ordinary shares of 50peachfor total fundraisings bytheCompany. amount wascredited tothewarrantreserve. Afurther2,661 warrantswere issuedtoOaktree sincethenduetoequity at anytimeoverthefollowing tenyears.Thewarrantswere fairvaluedat £1.2millionnetof related expensesandthis enlarged Group’s share capital.Thewarrantswere exercisable at the nominal share priceof 1pandcouldbeexercised Under theOaktree loanagreement theCompanyissued134,351,226 warrantstoOaktree, equivalentto4.4% of the merger relief to thepurchase of Oxxon TherapeuticsLimitedin2007. Oxford Biomedica(UK)Ltd usingthemerger methodof accountingin1996, and£1,580,000 from theapplication of The Group merger reserve at 31December2019and2018comprised£711,000 arisingfrom theconsolidation of At 1January2018 Group t 1January The cr (2018: 53,174) of thesedeferred share awards (note27). (2018: £267,000) related tothevestingof deferred share awards madetoexecutive directors andseniormanagers,less£nil(2018:£153,000) inrelation totheexercise of none edit toaccumulated lossesismadeupoutof thecharge for theyearrelating toemployeeshare-based paymentplansof £1,559,000 (2018:£1,132,000) (note28),£688,000 (173,876) (187,695) (16,066) £’000 2,247 2019 Group –

(182,663) (173,876) Warrant Warrant Warrant Warrant reserve reserve (1,218) £’000 £’000 £’000 ,1 ,9 3,509 2,291 1,218 1,246 ,1 ,9 3 2,291 1,218 ,1 ,9 3 2,291 1,218 7,541 2018 – – – (125,093) (123,077) (2,016) reserve reserve Merger Merger Merger Merger £’000 £’000 £’000 ,9 2,291 2,291 2019 Company – – – – (122,590) (123,077) (1,218) £’000 £’000 £’000 (446) 2018 Total Total ,509 ,509 (41) – –

At 31December2018 Issue of warrants Credit inrelation toemployeeshare schemes At 1January2018 At 31December2019 Net cashusedin/(generatedfrom)operations Credit inrelation toemployeeshare schemes At 1January2019 Opera Continuing operations Adjustment for: Changes inworkingcapital: Oxford Biomedica plc|Annual report andaccounts2019 Reconciliation of lossbefore taxtonetcashusedinoperations: 31. Cashflowsfromoperatingactivities corresponding credit toreserves. the subsidiaries, resulting in an increase in the cost of investment of £1,559,000 (2018: £1,132,000) (see note 15) and a statements (seenote28).Inaccordance withIFRS2theCompanyhastreated theawards asacapitalcontributionto with IFRS2’Share-based Payment’theexpenseinrespect of theseawards isrecognised inthesubsidiaries’financial Options over the Company’s shares have been awarded to employeesof Oxford Biomedica (UK) Ltd. In accordance Company payable totheschemeat theyear-end. amounts payablebytheGroup tothescheme.Contributionsof £253,000 (2018:£186,000), included inaccruals,were are heldinindependentlyadministered funds.Thepensioncostcharge of £1,769,000 (2018:£1,278,000) represents The Group operates adefinedcontributionpensionscheme for itsdirectors andemployees.Theassets of thescheme 32. Pensioncommitments Non-cash loss/(gains) Decrease/(increase) ininventory Charge inrelation toemployeeshare schemes Increase inprovisions Charge for impairment (Increase)/decrease incontractliabilities Loss ondisposalof property plantandequipment Increase indeferred income Amortisation of intangibleassets Increase intradeandotherpayables Depreciation Incr ting loss ease intradeandotherreceivables Warrant (14,467) reserve (1,218) (4,586) (6,636) (3,634) £’000 ,1 ,8 ,3 10,731 7,933 1,580 1,218 ,1 1,580 1,218 ,1 ,8 ,3 10,731 7,933 1,580 1,218 £’000 2,868 2,247 1,883 5,765 1,672 1,533 2019 – Group – – 58 22 – 3

reserve Merger (14,559) ,8 ,9 11,072 9,492 1,580 £’000 (8,012) 13,915 £’000 5,046 5,400 4,332 1,246 2,732 9,214 2018 (919) – – – 25 – 8 Scheme Reserve (1,246) (1,301) £’000 £’000 Share 6,801 1,559 ,3 1,132 1,132 2019 Company (55) – – – – – – – – – – – – (1,483) (1,575) £’000 £’000 9,599 2018 Total 341 83 – – – – – – – – – – – 9

Group financial statements 147 148 the newfacility. into for theconstruction of the Oxbox bioprocessing facilityandalsoequipmentrequiredin for thefill/finish process not provided for inthefinancial statements at 31December2019(2018:£15,723,000). These relate tocontractsentered The Group had commitments of £1,946,000 for capital expenditure for leasehold improvements, plant and equipment 34. Contingentliabilitiesandcapitalcommitments T Amounts recognisedinthestatementofcashflows Inter 2019 –LeasesunderIFRS16 Amounts recognisedintheprofitorloss Curr Lease liabilitiesincludedintheStatementofFinancialPosition Lease liabilities: Ma Right-of-use assets: Group Group presented below: The Group leaseslandandbuildingsITequipment.Information aboutleasesfor whichtheGroup isalessee 33. Leases for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019 Lease expense 2018 –Operating leasesunderIAS17 Expense relating toshort-termleases Total leaseliabilitiesat 30June2019 Non-current Total undiscountedcashflows at 30June2019 More thanfiveyear One tofiveyears Less thanoneyear Balance a Reclassified balances at 1January2019 Additions Depreciation charge for theperiod Balance at 31December2019 otal cashoutflowforleases turity analysis–contractualundiscountedcashflows ent est onleaseliabilities t 1January2019 Property 10,419 £’000 (608) 1,075 3,741 6,211

IT equipment £’000 (43) 142 144 41 –

31 December2019 31 December2019 31 December2019 31 December2019 12,829 10,561 £’000 £’000 £’000 £’000 £’000 8,389 4,490 6,355 3,782 7,907 1,075 7,222 T (651) 1,117 482 835 385 654 otal 137

Cash loanedbypar Cash management: Oxford Biomedica plc|Annual report andaccounts2019 including theexpensesof theparent company. Biomedica (UK)Limitedasaloan,andOxford Biomedica(UK)Limitedmanagesgroup fundsandmakes payments, property. Theproceeds from theissueof shares bytheparent are passedfrom Oxford BiomedicaplctoOxford the Group strategy, employsalltheUKstaff includingthedirectors, andownsmanagesall of theGroup’s intellectual The parent companyisresponsible for financingandsettinggroup strategy. Oxford Biomedica(UK)Limitedcarriesout dormant from incorporation todate of sale. It remained dormantsincebeingincorporated andinNovember2018wassoldfor noconsideration. Itremained During theprioryear, OcQuila(UK)Ltd wasincorporated asawholly-ownedsubsidiaryof theparent company. registered address for theCompanyandallof itssubsidiariesisWindrushCourt,Transport Way, Oxford OX4 6LT. and becamedormantin2007whenitsassetstradewere transferred toOxford Biomedica(UK)Limited.The Limited), theprincipaltradingcompany, andonedormantsubsidiary(Oxxon TherapeuticsLimited),whichwasacquired The Group consistsof aparent, Oxford Biomedicaplc,onewholly-ownedtradingsubsidiary(Oxford Biomedica(UK) Identity ofrelatedparties 35. Related partytransactions The investmentinthesubsidiary, of whichtheloanforms part,hasbeenimpaired by£126million(note15)inprevious years. Loan tosubsidiary Company: year-endbalanceofloan due for repayment within12monthsof theyearend.Theyear-end balanceontheloanwas: The loanfrom Oxford BiomedicaplctoOxford Biomedica(UK)Limitedisunsecured andinterest free. The loan isnot Issue o Warrants: Parent companyexpensespaidbysubsidiary Purchases: Company: transactionswithsubsidiaries 31 December2019(2018:none).Key personremuneration canbeseeninnote5of thefinancialstatements. January. There were nootheroutstandingbalancesinrespect of transactionswithdirectors andconnectedpersonsat There isanoutstandingbalanceof £5,417 (2018:£10,767) owedtoLorenzo Tallarigo at yearend.Thiswaspaidin Company: transactionswithrelatedparties There were notransactions(2018:none)withOxxon TherapeuticsLimited. resulting inacumulative increase inthecostof investmentof £9,492,000 (2018:£7,933,000). companies. Inaccordance withIFRS2,theCompanyhastreated theawards asacapitalcontributiontothesubsidiaries, In additiontothetransactionsabove,optionsoverCompany’sshares have beenawarded toemployeesof subsidiary f warrantsfor shares aspartof consideration for loanobtainedbysubsidiary ent tosubsidiary 248,152 54,829 (1,413) £’000 £’000 2019 2019 – 194,736 (1,370) 19,674 £’000 £’000 2018 2018 –

Group financial statements 149 150 No otheramountshave beenprovided for inrespect of thismatter. this basisitistooearlytoassessthelikelihood of anassetarising,therefore nocontingentassethasbeenrecognised. however theGroup cannotdeterminetheextentof anycoveruntilfurtherinvestigation isundertaken asnecessary. On A contingentassetcouldpotentiallyexistwithinthefinancialstatements for theinsurance coverthat thegroup maintains, provided aboveordonotincludeallclaimsandtherefore theamountsmaybeunderstated. required isinherently judgemental,andthere isariskthat thefinalsettlementsare materially different totherange consider theaboveestimate sufficiently reliableto recognisea provision (ifany)in respect ofthis matter. Theassessment no liabilityhasbeenrecognised at theStatement of financialpositiondate, asinmanagement’sopinionitistooearly to and £1,000,000. However, asthere isnosuchclaimtodate andgiventheearlystageof theinvestigation intothecause, claim. Ifaclaimwere tomaterialise, theGroup estimates therangeof allpotentialcostscouldbebetween£250,000 extinguished eitherthrough re-performance of theaffected workpackages, orultimately form part of anypotential In addition,theGroup expectsthat thepotentialliabilityarisingwithregards totheaffected workpackages willbe affected revenues relating tothe work packages with the liability recognised within Contract liabilitiesdue within one year. and hasassessedtheperformance obligations for whichtherevenue hasbeenrecognised andreversed allpotentially As at 31December2019, theGroup regards thismatter asanadjustingpostStatement of financialpositionevent(IAS10) information relating tothismatter duetotheveryrecent timingof thisissuebeingidentified. Group. TheGroup hasbeenincommunication withthethird partybutisnotyetinapositionto verifyorvalidate any performed on behalf of a customer in 2018 and2019 which potentiallycould give rise to a material claim against the Subsequent toyearendtheGroup identifiedanissue regarding anaspect of certainprocess development work rise toclaimsorpotentiallitigation againsttheGroup. The Group routinely entersintoarangeof contractualarrangementsintheordinary courseof businesswhichmaygive Contingent Liability concern basisinthepreparation of theGroup’s financialstatements (refer note1onpage114). COVID-19 outbreak hasbeenfactored intothescenariosconsidered aspartof theGroup’s adoptionof thegoing broader political andeconomic uncertainty coupled with the potentialfuture impact on the Group of therecent to determinetheexactimpactof COVID-19 ontheGroup ortoprovide aquantitative estimate of theimpact. The adjusting postStatement of financialpositioneventandgiventheinherent uncertainties,itisnotpracticable at thistime fluctuations inglobalstock markets. The Group considerstheemergence andspread of COVID-19 tobe anon- number of countries,leadingtodisruptionbusinessesandeconomicactivitythat hasbeenreflected in recent In early2020, theexistenceof anewcoronavirus (COVID-19) wasconfirmed, whichhassincespread across asignificant COVID-19 36. Eventsafter theStatementoffinancialpositiondate for theyearended31December2019 Notes totheconsolidatedfinancialstatements Group financial statements Oxford Biomedica plc|Annual report andaccounts2019 Oxford Biomedica’sLentiVector multiple therapeuticgenes. than mostothervectorsystemsandcanaccommodate Oxford Biomedica plc|Annual report andaccounts2019 cells inthebrain.OXB-102 usestheCompany’sLentiVector caused bythedegeneration of dopamineproducing nerve for Parkinson’sdisease,aprogressive movementdisorder Axo-Lenti-PD (formerly OXB-102) isagene-basedtreatment AXO-Lenti-PD (formerlyOXB-102: Parkinson’sdisease) LentiVector Oxford Biomedicaspecificterminology Glossary Other matters uses the Group’s LentiVector photoreceptors intheretina andvisionloss.SAR422459 of the ABCRgenewhichleadstothedegeneration of of Stargardt disease.Thediseaseiscausedbyamutation SAR 422459 isagene-based therapyfor thetreatment SAR 422459:Stargardtdisease provide long-termorpotentiallypermanentcorrection. administration of theproduct directly totheretina could deliver acorrected versionof theABCRgene.Asingle LentiVector that geneexpression couldbemaintainedindefinitely. The retinal cells in the eye. In such cell types, studies suggest non-dividing cellsincludingneurons inthebrainand with upto100%efficiencyandcanintegrate genesinto systems. Thetechnologycanstablydelivergenesintocells problems associated withearliergenerations of vector which isdesignedtoovercome thesafety anddelivery an advanced lentiviral vector based genedeliverysystem source of the neurotransmitter. factory withinthebrain,thusreplacing thepatient’s ownlost striatum, convertingcellsintoareplacement dopamine is administered locallytotheregion of thebraincalled that are required for thesynthesisof dopamine.Theproduct platform technologytodeliverthegenesfor three enzymes ® platform technology also has a larger capacity platform technologyalsohasa larger capacity ® platform ® platform technology to platform technology to ® platform technology is platform technologyis ®

solid tumoursandsomehaematological malignancies. 5T4 tumour antigen expressed on thesurface of most provide long-term orpotentiallypermanentcorrection. MYO7A gene.Asingleadministration of theproduct could 5T4 tumourantigen.ItusestheGroup’s LentiVector OXB-302 aims to destroy cancerous cells expressing the OXB-302 (CAR-T 5T4):cancer due toretinitis pigmentosabyusingtheGroup’s LentiVector hearing defect. SAR 421869 intends to address vision loss progressive retinitis pigmentosa combinedwithacongenital o of Usher syndrome 1B. The disease is caused by a mutation SAR 421869isagene-basedtherapyfor thetreatment platform SAR 421869:Ushersyndrometype1B platform f the gene encoding myosin VIIA (MY07A), which leads to f thegeneencodingmyosinVIIA(MY07A), whichleadsto ™ ™ technology to deliver a corrected version of the technologytodeliveracorrected versionof the and 5T4 antigen to target cancer cells expressing and5T4antigentotarget cancercellsexpressing ® ®

Other matters 151 152 genetic information. Deoxyribonucleic acid(DNA)isamoleculethat carries DNA among adults. It isthemostcommontypeof non-Hodgkin lymphoma a typeof whitebloodcellresponsible for producing antibodies. Diffuse large B-cell lymphoma(DLBCL)is a cancer of Bcells, DLBCL B celllymphoma. chronic lymphocytic leukemia (CLL) and diffuse large B cellnon-Hodgkin lymphoma(NHL),adultdisease cancers suchasacutelymphoblasticleukemia (ALL), CTL019 isaCAR-T celltherapyfor patients withBcell CTL019 — — — phases itmaybeapproved bytheregulatory authorities: many years.Ifthedrugsuccessfullypassesthrough all process willnormallyproceed through thephasesover is treated asa separate clinicaltrial.Thedrug-development into three phases.Eachphaseof thedrugapproval process Clinical trialsinvolvingnewdrugsare commonlyclassified Clinical trials(testinginhumans) an cells inapatient for thetreatment of adiseaseoften in Cell therapyisdefinedastheadministration of livewhole Cell therapy tumour associated antigen. modified Tcellscanbeengineered totarget virtuallyany Receptors (CAR)isananti-cancertherapeuticasCAR Adoptive transfer of Tcellsexpressing ChimericAntigen CAR-T therapy for introduction, abiologicalproduct intotheUSmarket. The BLA is a request for permission to introduce or deliver Biologics LicenseApplication(BLA) infects humansandsomeotherprimate species. Adeno-associated viruses(AAV) isasmallviruswhich AAV Terminology notspecifictoOxfordBiomedica Glossary Other matters Oxford Biomedica plc|Annual report andaccounts2019

Phase III against aplacebo. Phase II Phase I ex vivosetting. : screening for safety. : establishing the efficacy of the drug, usually : establishingtheefficacy ofthedrug,usually : finalconfirmation of safety andefficacy.

f can beinanexvivoorsetting.Themostcommon therapeutic DNAintoapatient’s cellswhich Gene therapyistheuseof DNAtotreat diseasebydelivering place insidethebodiesof livingorganisms. Latin termusedtodescribebiologicaleventsthat take In Vivo environment outsideof alivingorganism. of performing agiven procedure ina controlled Latin term(for withintheglass) refers tothetechnique In Vitro partners, inorder toaccelerate economicgrowth. is tostimulate innovation, working with businessandother Innovate UKistheUK’sinnovation agency. Itsrole Innovate UK for manufacturing,clinicalandlaboratory activities. conform to guidelines laid down by relevant agencies GMP, GCPandGLPare thepracticesrequired to GxP isageneraltermfor Good(Anything)Practice. GxP, GMP, GCP, GLP to provide treatment. or usingDNAthat encodesatherapeuticprotein drug Other f a functional,therapeuticgenetoreplace amutated gene. Gene therapy devices. drugs, vaccinesandotherbiologicalproducts, andmedical effectiveness, quality, andsecurity of humanandveterinary for protecting the public health by assuring the safety, US FoodandDrugAdministration (FDA) isresponsible FDA place outsidethebodiesof livingorganisms. Latin termusedtodescribebiologicaleventsthat take Ex Vivo and supervisionof medicinalproducts. of the European Union in charge of the evaluation European MedicinesAgency(EMA)isanagency EMA orm of gene therapy involves using DNA that encodes orm of gene therapy involves using DNA that encodes orms involve directly correcting a mutation, orms involvedirectly correcting amutation,

Oxford Biomedica plc|Annual report andaccounts2019 biologists todelivergeneticmaterial intocells. Are toolscommonlybasedonvirusesusedbymolecular Viral vectors and relations withshareholders. leadership andeffectiveness, remuneration, accountability standards of goodpracticeinrelationship toboard by theUKFinancialReportingCouncilandsetsout The UKCorporate GovernanceCodeispublished UK CorporateGovernanceCode(theCode) to treatment. B lymphocytes(atypeof whitebloodcell)that are resistant children andyoungadultsmake toomanyimmature (ALL) isatypeof cancerinwhichthebonemarrow in Relapsed orrefractory (r/r)acutelymphoblasticleukaemia r/r paediatricALL testing anddrugsafety data iscollected. can beginduringwhichimportantfeasibility, iterative is thestageof research that takes placebefore clinicaltrials Pre-clinical studies(alsoknownasnon-clinicalstudies) Pre-clinical studies devices workandare acceptablysafe. is responsible for ensuringthat medicinesandmedical Health andSocialCare intheUnitedKingdomwhich (MHRA) is an executive agency of theDepartmentof Medicines andHealthcare products Regulatory Agency MHRA Gene deliveryvectorbasedonlentiviruses. Lentiviral vectors copyright, trademarks, designrightsandpatents. property rightsfallprincipallyintofour mainareas; be treated asanassetorphysicalproperty. Intellectual Intellectual Property (IP) refers to creative work which can IP

Adjusted Operatingexpenses operating income. Gross income istheaggregate of RevenueandOther Gross income included. defined as Operating EBITDA with the R&D tax credit Operating EBIDA is an internal measure usedby the Group, Operating EBIDA for operational Cashflow. is anon-GAAP measure andisoften usedasasurrogate revaluation of investmentsandshare basepayments) (Earnings before Interest, Tax, Depreciation, Amortisation, Operating EBITDA Definitions ofnon-GAAPmeasures interest paidpluscapitalexpenditure. Cash burnisnetcashgenerated from operations plusnet Cash burn and Share basedpaymentsandtherevaluation of investments. Being Operating espensesbefore Depreciation, Amortisation

Other matters 153 154 United Kingdom Oxford OX4 6LT Transport Way Windrush Court Natalie Walter and registeredoffice Company secretary United Kingdom Kent BR34TU Beckenham 34 Beckenham Road The Registry Link AssetServices Registrars United Kingdom London WC2R 1BH 265 Strand Covington &BurlingLLP Solicitors United Kingdom RG1 3AD Reading 33 ForburyRoad 2 ForburyPlace KPMG LLP Registered independentauditors United Kingdom London EC2R 7HG 41 Lothbury Consilium Strategic Communications communications Financial andcorporate United Kingdom London EC2V 7NQ 85 Gresham Street WG Partners Financial adviserandjointbroker United Kingdom London EC2Y 5ET 120 LondonWall Moor House Peel Hunt Financial adviserandbroker Advisers Advisers andcontactdetails Other matters Oxford Biomedica plc|Annual report andaccounts2019

www.oxb.com [email protected] United Kingdom Oxford OX4 2JZ Oxford BusinessParkNorth Alec IssigonisWay Unit A,Plot7000 Oxbox United Kingdom Oxford OX5 1QU Yarnton Oxford IndustrialPark Unit 5 United Kingdom Oxford OX4 6LX Cowley Transport Way County Trading Estate Harrow House Other locations: Tel: +44(0)1865783000 United Kingdom Oxford OX4 6LT Transport Way Windrush Court Headquarters: Oxford Biomedicaplc Contact details

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Oxford Biomedica plc Windrush Court, Transport Way Oxford OX4 6LT, United Kingdom Tel: +44 (0) 1865 783 000 [email protected] www.oxb.com