Appendix 4C, page-62

I sent a query to Glyn about the report this afternoon:

"I've just read the report on the ASX and, though it comes across as reasonably positive, the one thing that struck is that it is very short on detail - so much so that I don't actually feel I'm any better informed about the progress and anticipated prospects of the company than I did before the report came out.  My particular queries are as follows:

1. SK-II: The report refers to a "multi-year strategy for the use of OBJ technology in various SK-II applications".  That seems to suggest some kind of agreement is in place between OBJ and P&G to implement a strategy (that will obviously require resources from OBJ) for several years. What are the essential terms of this multi-year strategy agreement?

2. PDA programs: The report refers to the "parties remain committed to expanding the application fo OBJ's technologies to additional applications" after "invaluable meetings".  What time frames are we talking about here? Have clinical evaluations been done of new products? I'm really not sure where the company is at here.

3. Coty: The prototypes are complete, says the report. But I was under the impression they were completed last year. What's the hold up?

4. GSK: The report says we have "excellent working relationships". But where are we at with the three programs? The report mentions them but does not give any substantive update/concrete progress.

5. New Potential Partnering: No names mentioned, no product applications mentioned. Again, I'm left with no idea at all what these could possibly lead to.

In summary, there is very little in this report to assist me with evaluating object progress of the company. Obviously the directors know a lot more about what's going on than the shareholders, and where in time the directors anticipate products and programs to come to fruition.  Is it still a case of the company refraining from informing shareholders about such matters because of contractual confidentiality obligations? If not, then as a publicly listed company, I really think shareholders should be told a lot more than they current are being told, even if that means the directors engaging in a bit more forecasting based on the objectively known facts. Disclaimers can always be sensibly included in such forecasts."


And here is his reply just received: "The quarterly seeks to update those items that were previously reported in the December quarter and they in turn cover the items that have been previously announced There is a lot going on at the moment with our principal partner in P&G across both Asia and the U.S. And the work with Coty is progressing well so we are optimistic about the possible outcome with Coty. But with the increased visibility of OBJ that has been brought about with the success of SKII, we are fielding increasing enquiries from other pharmaceutical companies who are either hearing about us for the first time or have sought to renew relationships following the validation of OBJ's technology by such a big name as P&G. That's all good for us in our diversification strategy.

But all of these items are progressing well. We intend continuing a high level quarterly update from now on and when we do start receiving significant levels of income, we will so focus more attention on the Financials which we have made our first comments on in this report."