ANNUAL REPORT 2020 2 2020 at a glance 4 Chairman’s letter 6 CEO’s report 8 Key milestones and highlights – 2019/2020 10 Pipeline review 13 GBM Agile 14 Working with the best 15 The journey to a commercial product 19 Financial report FY20 2020 AT A GLANCE 2020 AT CHAIRMAN’S LETTER CHAIRMAN’S CEO’S REPORT CEO’S KEY MILESTONES PIPELINE REVIEW FINANCIAL REPORT DIRECTORS’ REPORT DIRECTORS’ FINANCIAL STATEMENTS THE PATH AHEAD IS CLEAR. KAZIA IS UNFALTERING IN OUR COMMITMENT TO TAKE PAXALISIB INTO AN INTERNATIONAL PIVOTAL STUDY FOR REGISTRATION. OUR SUCCESS WILL MEAN THE FIRST NEW DRUG FOR PATIENTS DIAGNOSED WITH GLIOBLASTOMA IN MORE THAN TWO DECADES. ANNUAL REPORT 2020 1 2020 AT A GLANCE Kazia Therapeutics is an oncology-focused biotechnology company, developing innovative anti-cancer drugs. We collaborate with clinicians, scientists, and researchers around the world to bring new hope to patients with cancer. Paxalisib is currently in clinical 5 368 121 trials at world- Ongoing clinical Hospitals currently Patients treated leading centres trials with paxalisib recruiting patients with paxalisib in a wide range to paxalisib worldwide to date of different forms clinical trials of brain cancer OUR CLINICALOUR RESEARCH As at 30 June 2020 As at 30 June 2020 As at 30 June 2020 Glioblastoma is the most common 133,000 65% and the most Patients diagnosed with glioblastoma Of patients will aggressive form worldwide each year never respond to of primary brain Source: GLOBOCAN 2012 temozolomide, the only existing cancer standard of care OUR PATIENTS OUR 85-90% Of glioblastoma patients have dysregulation of Source: AA Pandith the PI3K pathway, which is targeted by paxalisib et al. (2018) Scientific Source: Cancer Genome Atlas Reports 8:6704 2,450 Since 2016, Kazia 2017 has built a lean, US$ 1.5b highly efficient 4,020 Forecast global commercial market business focused 2018 opportunity for glioblastoma per annum on clinical 4,150 development of 2019 novel anti-cancer 4,304 OUR BUSINESS therapies 2020 63 78.9% Media mentions Patents granted for Of operating cashflows for FY2020 paxalisib worldwide invested in R&D (FY20) 2 KAZIA THERAPEUTICS LIMITED 2020 AT A GLANCE 2020 AT CHAIRMAN’S LETTER CHAIRMAN’S Overall Survival Cantrixil is Progression-Free Survival Paxalisib: currently 25 REPORT CEO’S completing a Cantrixil: months Patients treated 17.7 clinical trial in with Cantrixil months Temozolomide ovarian cancer worldwide to date 5.5 (existing standard Chemotherapy: of care): KEY MILESTONES 3.4months 12.7months Interim analysis as at Interim analysis as at 29 February 2020 As at 30 June 2020 30 September 2019 PIPELINE REVIEW Number of new therapies Number of clinical trials 5-year survival of approved by FDA, 2010-2020 commenced, 2019 patients Lung cancer: Breast cancer: Breast cancer: FINANCIAL REPORT 17 135 90 Glioblastoma: Glioblastoma: Glioblastoma: 0 35 3 DIRECTORS’ REPORT DIRECTORS’ Source: US Food and Source: US National Drug Administration Source: clinicaltrials.gov Cancer Institute FINANCIAL STATEMENTS Enterprise value (market capitalisation, Indicative Analyst Valuation (AU$) less cash) (AU$) $35.6m 13 May 2018 $103M 19 Sept 2018 $103M 1 Apr 2019 $115M $12.7m 31 Mar 2019 $137M $5.7m $14.9m $3.8m 23 Jun 2019 $137M 30 June 30 June 30 June 30 June 30 June 2016 2017 2018 2019 2020 Source: Edison Research ANNUAL REPORT 2020 3 CHAIRMAN’S LETTER IT IS FAIR TO SAY THAT THESE RESULTS HAVE SUBSTANTIALLY EXCEEDED EXPECTATIONS, AND THEY DEMONSTRATE THE RICH AND GROWING POTENTIAL OF THIS VERY PROMISING DRUG 4 KAZIA THERAPEUTICS LIMITED 2020 AT A GLANCE 2020 AT CHAIRMAN’S LETTER CHAIRMAN’S Dear Shareholder, Kazia register. It has been noted the second half of calendar 2020, previously that few listed companies although of course we continue Our company concludes the 2020 can achieve their full potential to monitor the rapidly changing financial year in a very strong without the support of professional operational environment. position, despite the ongoing investors, and each of the three COVID-19 pandemic. We are The GBM AGILE study places REPORT CEO’S financing rounds that Kazia has reporting very encouraging data, paxalisib on a direct path to completed have been anchored by we are well-funded, and we have commercialisation. If the drug’s institutional participants. Most of the a clear path forward for our lead performance matches our hopes and participants in earlier rounds have asset, paxalisib. I am very pleased expectations, it stands to become continued to support the company in to highlight here some of Kazia’s the first drug approved for this group its most recent raise, reflecting their specific achievements during the past of patients in over twenty years, and robust and ongoing commitment to twelve months. the first signal of hope that even this KEY MILESTONES the company’s success. most challenging of cancers can be FINANCIAL PERFORMANCE In parallel, the company offered beaten. Our cash balance at 30 June existing shareholders an opportunity I have said previously that we 2020 was $8.8 million, versus to strengthen their position on the consider the best path forward for $5.4 million at 30 June 2019. Our same terms as institutional investors, Cantrixil to lie in a partnership with a total assets were $23 million, as via a Share Purchase Plan (SPP) in larger company, one who shares our against $21.2 million at 30 June May 2020. This was extremely well belief in the asset’s potential, and PIPELINE REVIEW 2019. We committed net outlays of supported and raised approximately who brings to the partnership the $8.8 million to advance the company, $1.8 million. The proceeds of our wherewithal and technical resources of which 79% was devoted directly last SPP, in 2018, allowed us to put to fully realise that potential. Our to investment in R&D. in place several high-quality clinical efforts on this front remain ongoing, research collaborations for paxalisib, Kazia remains, in your Board’s view, and will be driven by final data from and we expect to likewise apply the an exceptionally efficient drug the phase I study, which we expect to funds from this SPP directly to the development business. With the have on hand in Q4 CY2020. FINANCIAL REPORT task of bringing hope to patients with resources at hand, the company brain cancer. I would like to thank my fellow has completed recruitment of two directors and our management team, international clinical trials, has PROGRESS led by our CEO, James Garner, for continued to support four ongoing I have said before that the lifeblood their dedicated and unflagging work investigator-initiated studies, has of any life sciences company is clinical in support of the company. In the presented data at four international data. On that score, I will allow the four years or so since Kazia began conferences, and has executed an REPORT DIRECTORS’ numbers to speak for themselves. to take form, we have achieved a extensive program of regulatory and Paxalisib has reported a progression- great deal, but our most important manufacturing work to support the free survival of 8.4 months (versus work lies ahead. We are grateful to critical transition of paxalisib into a 5.3 months for temozolomide, the our shareholders whose support has pivotal study for registration. existing standard of care), and an made these achievements possible, FUNDING overall survival of 17.7 months (versus and I look forward to reporting our 12.7 months for temozolomide). It further progress in the year ahead. We have completed two financing FINANCIAL STATEMENTS is fair to say that these results have rounds during the financial year, substantially exceeded expectations, in October 2019 and April 2020. and they demonstrate the rich In aggregate, these efforts have and growing potential of this very raised some $13 million in new promising drug. capital for the company and have brought significant and high-quality OUTLOOK institutional support to the share Iain Ross Given these data, our highest priority register. Both raises were executed Chairman of the Board is to move paxalisib swiftly into a at extremely competitive terms: pivotal study for registration. We are a 17% discount to 5-day VWAP in delighted to have been accepted onto October, and a 3% discount in April, the GBM AGILE study, a ground- notwithstanding the very challenging breaking international clinical trial environment in capital markets that has been established by many of associated with COVID-19. the leading experts in glioblastoma Aside from the vital funding that to expedite the delivery of new drugs these transactions provided, we have for this very challenging disease. been pleased to welcome a number As previously flagged, we expect of new institutional investors to the commencement of GBM AGILE in ANNUAL REPORT 2020 5 CEO’S REPORT PUT SIMPLY, IT APPEARS THAT PAXALISIB MAY BE ABLE TO EXTEND THE LIFE OF PATIENTS WITH GLIOBLASTOMA 6 KAZIA THERAPEUTICS LIMITED 2020 AT A GLANCE 2020 AT CHAIRMAN’S LETTER CHAIRMAN’S Dear Fellow Shareholder, We have made great strides over Behind each of these headline Finally, the Cantrixil program in the past twelve months, and it is a data points is a mass of detailed ovarian cancer has continued testament to the hard work of many and painstaking work by the Kazia to deliver. Presentations at the people that we now stand poised team, which collectively supports European Society for Medical REPORT CEO’S shortly to commence a pivotal paxalisib’s journey through the Oncology in September 2019, and to study for registration with paxalisib complex regulatory pathway to a the American Association for Cancer (formerly GDC-0084). Kazia has marketed product. One important Research in June 2020, both showed come a very long way in the last four landmark on this journey was the promising signs of activity for the years or so.