ExecutiveSummaryRohan Hockings presented at the AGM a very...

ExecutiveSummary

Rohan Hockings presented at the AGM a very positive future with4 drugs in clinical trials in 2024/25. Then FDA approval and commercialisationin 2027.

PYC has a focus on discovering precision medicines formono-genic or genetically validated targets which have a 5 - 8 times highersuccess rate because the disease is caused by "one problem going on in onecell", Dr. Hockings said.

He gave a very upbeat outlook on the 4th drug for PKDPolycystic Kidney Disease because it has already demonstrated efficacy in 3Dkidney models from patients with the disease. PKD's prevalence is around 1/1000and currently no effective treatment, let alone a cure. 50% of them eventuallyneeding dialysis and kidney transplant. PYC's PKD drug could arrest the courseof the disease and enabling damaged kidneys to regenerate and restore function!

If all goes well, the PKD drug would be commercialized in2027 with an estimated recurring annual earnings of US$10b.

This is my take…

This would translate to an earnings of around A$4.12 pershare. If 10% of which is ploughed back to new drug discovery and 90%distributed as dividend, say A$3.70 and investors are happy with 6% dividendyield, the share price should be A$60 based on one drug being approved andthere are 3 more to come.

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DetailedSummary

He recommends watching the Youtube video "Atlas Venture 2023 Year in Review- B. Booth"
https://www.youtube.com/watch?v=0DIgT32bFV4&ab_channel=AtlasVenture

PYC is developingthe class of drug with the highest probability of success.

We are a four drug company with lean and efficient operation at 1/4 ofother biotech companies with a single drug.

Mono-genicor genetically validated targets: one problem going on in one cell => 5-8times higher success rate

Next24 months - 4 drugs through clinical trial phase one, two and three.

The 3 horizons

Last year'sAGM: 3 horizons set out to shareholders – we are pretty much on track!

1. Early phase- 2018 Alan and Rohan taking a platform technology and working out what to dowith it, how to translate into value creation.

2. Mid phase: 2021-22Focused on building the capability to translate a molecule into a drug. Tosatisfy the regulator that the molecule is safe and has a prospect ofadministering into a human in a clinical trial.

3. Currentphase: 2023-24 Translation of multiple assets into clinical development.

PYC is reallyprivileged to have a differentiated delivery technology that solves thefundamental challenge for precision medicines. “If you can do something thatnobody else can do, you should apply it in the context in which nobody else ispursuing “... We should ensure that we are going to have an impact in the livesof patients who otherwise would not have treatment options.”

Beyondthe 3 Horizons – Wave 4: “Turning of the cards”

Wave 4:2025-2026: “Turning the cards - We're going to see whether or not we canachieve the impact that we set out to achieve which really starts in 2024. Weare moving through the single ascending dose study in the RP11 clinical trial. Wehave a safety review committee meeting scheduled for the 15th of December”.

Phase 1 studieshave a higher failure rate than there is in Phase 2 and a 70% chance ofconversion from Phase 3 to market.

Wave 5: 2027-2028

Preparation fora market launch and revenue generation.

Ourthird and fourth Assets (Phelan McDermid Syndrome & PKD) in our pipeline notjust arresting that disease from progressing, there's evidence that in fact youcan reverse that disease phenotype.

The reward forthe enormous effort that has been put in by the staff members to get us to thispoint is a phenomenal.

The 4 Pillars of PYC R&D Strategy

• monogenic,
• intracellular,
• haplo-insufficiencies,
• validated in patient derive models.

Question from the floor

Why haven't you done a deal?

There's a hugetemptation to out license one of these assets. We continue to build value as wetake these assets forward. If you are de-risking by getting through a Phase 1study where Phase 1 is the key risk in the value chain from that point, allyou're doing is increasing the expected valuation of that asset and you'llstrengthen the negotiating discussion.

Correlated Risks?

Are the drugsin the pipeline correlated? If anyone fails, would it risk the outcome of theothers? Rohan’s answer is “No, they have uncorrelated risks” Although the top 2drugs in blinding eye diseases are sufficiently similar in modality but if wecould establish safety in RP11, ADOA would be a given. In terms of efficacy,they have a different delivery technology, a different cell type, and adifferent mechanism of action of the oligo (direct vs indirect). With all thesecombination, if the RP11 asset were to fail that does not mean that the ADOAasset is going to fail.

Is PKD efficacy easy to establish? PKDFDA in 2027?

PKD drug has amuch simpler way to prove efficacy by testing a urine sample for the biomarker UrinaryPolycystin 1 (PC1) and a scan (Total Kidney Volume TKV imaging) of the kidneyto see the volume shrinking back to that of the wildtype.But the FDAhave come out and said they are not going to take the biomarker but they willtake what they call a surrogate endpoint. They will take height adjustedtotal kidney volume scan at Phase 2. This is much shorter than the 2 years toestablish the eye’s functional improvement on a slow progressing disease likeRP11 and ADOA which have no biomarker to test for.Furtherconfirmatory study in Phase 3 after the launch the product in the market usingeGFR (estimated Glomerular Filtration Rate) which is definitive in the reversalof the disease.

*** ADPKD isgoing to overtake ADOA and it's going to come very close to overtaking RP11 aswell.

Costper Milestone?

In US, it costsUS$100M to submit an IND. We're looking at about a $25M cost, a bit more forADPKD because it's systemically administered, making the drug, it has to be doneat a much bigger scale than the eye drug. The actual costs of what we've done (forthe eye drugs) would run into the single-digit millions of dollars.

PYCis very excited about its PKD Drug

You are about to find out:

• In a non-human primate we alreadyknow from a mouse that whether the drug when it is administered in the veingets to the kidney in high concentration.
• We know it'll do it with a very evendistribution throughout the kidney.
• We’ll reach the Medulla where othertechnologies cannot and
• We know that it will engage with thePKD1 transcript and do it very specifically because we've designed andengineered this drug not to have off target binding effects but just to do thatone thing.
• We know it will stabilize thattranscript,
• We know it will engender anupregulation of the PC1 protein,
• We know that it will mediate If youskip down.
• Okay, what happens from themonogenic cause the blackbox the actual functional readout we know it's goingto inhibit cyst propagation in those patients.

RegulusTherapeutics in Phase 1B trial for their PKD drug, competition?

No. It'sgoing to bind to a target called micro RNA 17, MIR 17 inside the cell. It worksbut it does 200 other things inside the cell as well including regulating somevery important oncogenes. No wonder their market cap came from the billions ofdollars down to the tens of millions of dollars, Wall Street is saying NObecause no micro RNA targeting drug has ever been approved.

Secondary impacts of PKD to a patientbeyond the kidney

As a consequence of PKD1 haplo-insufficiency, it appears there'ssome loss of the structural strength of the extracellular matrix, the stuffthat holds cells together. So patients get a weakening of the blood vesselwalls and they suffer from Cereal Aneurysms. They get a weakening of the connective tissue that assists the function of the heart valve so you get what they call Mitral Valve Prolapse or the valves going past proper closing they get weakening of the abdominal wall and Abdominal Wall Hernias. They could also get Liver Cysts as well.

ADOAaccelerated timeline via TGA

We are looking at a TGA Pathway to further accelerate thetimelines that we've previously publicized so an Australian Phase 1 clinicalstudy moving to the US in Phase 2. We are looking todose humans in that indication in the first half of next year.

Conversation with Mount Sinai MedicalCentre in New York

With the PhelanMcDermid Syndrome program, we had a terrific conversation with Mount Sinai MedicalCentre in New York and the clinicians there want to scale up behind the drug which targets the SHANK-3 gene. They are waiting for one additional piece of data. They want to see if it can youdo what we’ve done in the reporter cell in a human neuron. That readout iscoming soon in the early parts of next year. This is the drug that can change the lives of children whoare unable to communicate with their parents with very severe phenotype.

Conversationwith the US investors, the US bankers

4first-in-class drugs with disease modifying potential that are moving throughevery Phase of clinical study in the next 24 months coupled with 6 humanreadouts. It's very interesting the conversation with the US investors, the USbankers, they're starting to see it.

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