Advanced Oncotherapy plc Annual Report 2020 Democratising Proton Therapy Advancing cancer treatment with innovative, cost effective technology Advanced Oncotherapy plc. Annual Report 2017 Advanced Oncotherapy plc Annual Report 2018 Advancing cancer treatment with innovative, cost effective technology Advancing cancer treatment with innovative, cost effective technology Advanced Oncotherapy plc Advanced Oncotherapy plc Annual Report Annual Report 2019 2020 Democratising Proton Therapy Advancing cancer treatment with innovative, cost effective technology Democratising Proton Therapy Advancing cancer treatment with innovative, cost effective technology This report is available on our website www.avoplc.com/en-gb/Investors/Company-Documents ADVANCED ONCOTHERAPY PLC 1 TO OUR SHAREHOLDERS STRATEGIC REPORT OUR PURPOSE We are driven by our purpose: democratising proton therapy. Just as the mobile revolution democratised communication among people, healthcare must be democratised. At Advanced Oncotherapy, we believe access to healthcare is a fundamental human right. Yet, the provision of healthcare is still not universal and many people cannot afford quality health services. Proton therapy is one of the many segments in healthcare where a different global approach that is truly democratic must emerge. Fundamentally, we believe in a new model that will change the way we treat cancer, and the relationship between patients and physicians as we know it. TO OUR SHAREHOLDERS FINANCIAL REPORT Consolidated Statement of Profit or Loss and STRATEGIC REPORT Other Comprehensive Income 108 Introduction to Advanced Oncotherapy 8 Consolidated Statement of Financial Position 109 Why our Commitment to Patients? 24 Consolidated Statement of Changes in Equity 110 What We Do 30 Consolidated Statement of Cash Flows 111 How We Do It 58 Notes Forming Part of the Financial Statements 113 Notes to the Accounts – Group 114 GOVERNANCE REPORT Company Statement of Financial Position 138 Advanced Oncotherapy Team 76 Company Statement of Changes in Equity 139 Corporate Governance Report 82 Notes to the Accounts – Company 140 Statement of Directors' Responsibilities 88 Audit Committee Report 90 OTHER INFORMATION Remuneration Committee Report 92 Notice of Annual General Meeting 148 Section 172 Statement 96 Explanatory Notes to the Notice of Annual Group Directors' Report 98 General Meeting 150 Independent Auditor’s Report 102 Company Information 152 ONLINE You can find more information about Advanced Oncotherapy at www.avoplc.com 2 ANNUAL REPORT 2020 GOVERNANCE REPORT FINANCIAL REPORT OTHER INFORMATION We know accessibility and affordability are hindering the widespread use of proton therapy. Innovation in healthcare breaks down these walls of cost, time and location. With our technology originated at the world- renowned place of excellence and science – CERN – we work every day to make proton therapy a reality for every patient. Our LIGHT technology possesses the power to remove the obstacles which are associated with legacy systems and which prevent access to proton therapy for all. ADVANCED ONCOTHERAPY PLC 3 TO OUR SHAREHOLDERS STRATEGIC REPORT TO OUR SHAREHOLDERS Dear shareholders, platforms and minimising the number of hospital patient visits through more efficient and targeted radiation therapy It is my great pleasure to introduce another annual report and systems. These new solutions facilitate access to innovation accounts at such a pivotal time in Advanced Oncotherapy’s of cancer centres and support more partnerships to accelerate development. the convergence of radiation with targeted drugs. These are a few important changes we foresee and which we believe 2020 will certainly be remembered all over the world for the will continue well beyond the short- to mid-term of the active Covid-19 pandemic, an unprecedented health crisis of epic proportions bearing profound social, economic and financial pandemic. consequences. My first and foremost thoughts are for all of those • The Covid-19 pandemic has taken a terrible toll around the who lost their dear ones over the past year. I also world – but some sectors have been more want to express my utmost gratitude to all our affected than others. People with underlying employees and partners who have shown conditions, including cancer, or those remarkable dedication, agility and resilience living in countries with under-developed during these unprecedented circumstances. healthcare infrastructure have been hit disproportionately hard by the virus. As Albert Einstein suggested, out of This makes our purpose centred crises can emerge new and incredible around defeating cancer through opportunities, particularly if traditional the democratisation of proton approaches and paradigms are therapy more meaningful than questioned and challenged. This ever. We want to play our part Covid-19 pandemic is no exception; it underscores three major opportunities and have an impact in broadening for Advanced Oncotherapy: access to cancer therapy by making • The Covid-19 pandemic has been a proton therapy more accessible wake-up call for governments to do more and affordable. All the decisions we to tackle cancer. Cancer is a pandemic have taken were not always the easiest in itself and time is exceedingly precious. ones, but they were the right ones to Every minute during 2020, nine people were serve our purpose and I am convinced that diagnosed with cancer in Western Europe1. many patients around the world and all our A one-month delay in treating cancer results in a 6 to 13% stakeholders will soon reap the rewards of our strategy. higher risk of dying2. Sadly, 50% of governments had their In the face of these challenges, we continued to make progress cancer services partially or completely disrupted as a result of on our strategy. This is a testament to the leadership of Nicolas the Covid-19 pandemic3 and it is estimated that some 50,000 4 and his management team who have navigated the Company people in the UK are probably missing a cancer diagnosis . through the year and ensured people across our Company Yet, the stark impact of the pandemic on cancer care has remained focused on our purpose and project. Ensuring our made everyone realise the actual human cost of neglecting LIGHT system can deliver a proton beam for all radio-sensitive non-communicable diseases like cancer. With the number tumours remains our number one priority for 2021. of new cancer cases currently expected to rise by more than 45% over the next twenty years5, more actions must be taken The success of our strategy and execution plan relies on well- to bend the curve and raise further awareness at all levels. We proven design and industrial processes. It is also predicated on have already seen governments, payers and other healthcare four important strategic pillars: stakeholders seeking new ways to accelerate the fight against • differentiated, asset-light and patient-centric business model; cancer and deploy new initiatives. Advanced Oncotherapy • commitment to do business responsibly and sustainably; has a key role to play in this broad eco-system. • continued innovation with clear metrics to prioritise • The Covid-19 pandemic is reshaping oncology practice and initiatives and assess their expected return; and delivery of cancer care broadly, shifting care onto virtual • unique culture embedded in our governance framework. “I am confident that the business model we are building around the superiority of LIGHT and centred around customers' needs is a long-term sustainable growth model that will prove rewarding for Advanced Oncotherapy's shareholders” 1 Source: WHO 2 Source: The British Medical Journal 3 Dr. André Ilbawi, from WHO 4 Source: Macmillan Cancer Support 5 Source: WHO 6 This is approximately ten times faster than cyclotrons 7 Up to 10 times smaller versus cyclotrons 4 ANNUAL REPORT 2020 GOVERNANCE REPORT FINANCIAL REPORT OTHER INFORMATION DIFFERENTIATED, ASSET-LIGHT AND PATIENT-CENTRIC In summary, I am confident that the business model we are building BUSINESS MODEL around the superiority of LIGHT and centred around customers’ The commercial launch of LIGHT represents a shift away from needs is a long-term sustainable growth model that will prove competition and into a space where, as a technology disrupter, rewarding for Advanced Oncotherapy’s shareholders. we can provide long-term attractive return opportunities for our customers. COMMITMENT TO DO BUSINESS RESPONSIBLY AND SUSTAINABLY WITH A CLEAR SOCIAL PURPOSE LIGHT has been designed to treat at an affordable cost a large Many years ago, CERN designed LIGHT with the view of doing spectrum of tumours. Its potential goes well beyond the hard- the right thing for patients, society and our planet: to-treat tumours such as head and neck tumours. Its ability • it can be installed in a contiguous and densely populated to deliver radiation pulse-by-pulse 200 times per second6 environment, allowing patients to be treated at proximity to 7 combined with its significantly narrower proton beam make it their families; perfectly suited to sculpt radiation doses based on the irregular • it can be easily installed directly into existing clinical facilities; shape of the tumour, taking into account potential tumour motion • it can be transported in standard containers and trucks; it does as a result of breathing and heart movements. not require expensive cranes or load handling devices; and As we seek to deliver our mission of democratising proton • as a result of being able to be operated with an efficiency