Peloton email 11/4, page-4

in an email I received this morning
IMAGION BIOSYSTEMS LIMITED (IBX) - $2.4m Entitlement Offer - Closes 5pm (AEDT), FRIDAY 14 April 2023

This is the Q & A part - go to question highlighted
Shareholder Questions, Company AnswersQuestion -
What will the Entitlement offer money raised be used for?
Proceeds from the Entitlement Offer are intended to primarily be used to significantly strengthen the Company’s balance sheet and provide funds towards: Establishing the clinical and regulatory support teams and to prepare the Company’s MagSense® HER 2 breast cancer imaging agent for the next phase of development including manufacturing of materials;The Company’s business development activities, working capital, corporate activities, and offer costs.The proceeds will allow the Company to enable advancement to the next stage of clinical development in relation to the MagSense® HER 2 breast cancer imaging agent and move towards an IND (investigational new drug) application, which the Board views as having the potential to generate significant shareholder value.
Question – Why has the share price dropped so suddenly when the offer was announced?
It is not uncommon for a stock to trade at the offer price through an offer period and as some shareholders sell some of their shares to participate in the entitlement.In this case, there has been further pressure on the price from macro conditions outside of the company’s control such are rising inflation, falling markets and rising interest rates along with greater uncertain macro themes.However our strategy to commercialise MagSense® remains firm. Question – How long do you anticipate clinical development to take for MagSense® HER 2 breast cancer imaging agent until it moves to IND (Investigational new drug) application?We are in discussions now with the FDA on next steps for Magsense. Once the outcome of the discussions are known, we will have a clearer picture of the pathway to market. We anticipate knowing the outcome of these discussions and progression to IND during 2023.

Question – Assuming MagSense® HER 2 breast cancer imaging agent is in IND, how long until it is approved and ready to commercialise?
We have a pipeline of opportunities which we are developing from Product concept, to preclinical research and clinical research. MagSense for HER2 is the furthest developed, we also have MagSense Prostate Cancer nanoparticles in preclinical development (with promising pre-clinical R&D released to the ASX in September 2022). We are also working on other indications such as ovarian and brain cancer. With MagSense for HER 2 , we won’t be able to give a timeline until our discussions with the FDA are finalised.

Question – The shareprice has been trending down over the past year, would you say the company is in a far better position today than it was a year ago? If so, why?The company has reached some significant milestones over the last 12 months, with key initial clinical milestones achieved. The company now has a proof of principal for its MagSense Her2 breast cancer imaging agent from patient data from its phase 1 clinical trial in Australia. It is also building a pipeline of other cancer indications such as prostate, ovarian and brain cancer.First product for HER2 breast cancer shown to be safe and well tolerated in Phase I studyIn-human clinical data supports use of MagSense nanoparticles with both proprietary detection technology (MRX) and conventional MRI, the Company now prioritizing the use of MRI systems as a faster path to patients and the marketStrong evidence that the Company’s nanoparticle technology has the potential to target prostate cancer tumours as well as additional R&D in relation to ovarian and brain cancer$2.5M R&D tax incentive receivedReceived second CSIRO grant for prostate cancerCommercially focused team with deep industry experience and clinical expertise

Question – Further to the above question, how doesn’t management intend to create short-term shareholder value to assist the share price?
The Company has announced its strategy to prioritise development and commercialisation of the MagSense® nanoparticle technology with MRI as a faster path to patients and the market following an independent review by a panel of expert breast cancer radiologist corroborated the Company’s previous findings.The fact that cancer detection can be achieved when using the MagSense® imaging agent with MRI has significant implications for the company. MRI is already part of clinical workflow with a large installed base of scanners helping drive faster adoption. It also eliminates the near-term expense and risks associated with developing and introducing a new type of detection technology.The Company has been in discussions with the FDA and has filed a pre-IND for its Her 2 breast cancer imaging agent with a view of filing an IND in 2023.With our MagSense® HER2 imaging agent for breast cancer advancing in clinical testing, we have been expanding our R&D pipeline. There is strong support for us to continue the development of a MagSense® imaging agent for prostate cancer.

Question – Why has the company decided to run a capital raise now?
The capital raise provides growth capital and liquidity as Imagion advances its portfolio of imaging agents further into clinical development.Funding will be used to prepare the Company’s MagSense® HER2 breast cancer imaging agent for the next phase of clinical development, fund pipeline growth into oncology indications such as prostate and ovarian cancer and to provide additional general working capital.The Company has already initiated the regulatory process with the US Food and Drug Administration (FDA) to bring HER2 Breast cancer clinical studies to the US where there will be access to a larger number of sites and a more substantial patient population. The plan is to use a portion of these funds to pursue an IND application which will be a significant milestone for Imagion.

Question – What’s the company’s strategy to generate revenue?
The Company’s focus is on preparing the Company’s MagSense® HER 2 breast cancer imaging agent for the next phase of clinical development, with the next key milestone an IND application. The Company is also focused on growing its pipeline of other indications such as prostate and ovarian cancer.The company has identified multiple potential revenue opportunities for its product once it is past the clinical stages:The product can be sold as reimbursed single use consumable with high gross marginsAlignment with strategic partners to commercialise in global marketsUtility extendable to therapeutic applications and delivering drugs

Question – Why has Mercer agreed to secure funding for IBX?
This is Mercer’s second investment into Imagion, Mercer have built a strong relationship with management having followed their progress for some time. They believe Imagion’s technology could significantly impact the cancer imaging market and they have strong confidence in the company’s potential for growth.

Question – Can future operations slow or be delayed if there was a sudden COVID outbreak?
(new variant)We proceeded with Phase 1 trials during the last outbreak, it slowed recruitment but did not halt the trial. We would expect a similar impact from any future COVID outbreak, with delays to enrolment in any trial.

Question – Could further inflationary pressures or rising interest rates affect operations?
Rising inflation rates and inflation impact supply chain, materials and corporate costs such as leases. Our costs will go up but our operations with respect to the clinical trials will continue.

Question – If the offer price trades higher than the market price, why would I participate in the Entitlement Offer?
Let’s assume the offer price is higher than the market price; unfortunately, in this situation we can’t control the market price, however there’s a difference between buying on market vs participating in the Entitlement offer.Buying on market – means you’re facilitating a 3rd party trade for existing shares, so a seller of the stock will receive funds and you will receive the stock at the purchased market price, plus you pay transaction fees.Participating in the Entitlement Offer – is the purchasing of new shares issued by the Company, with funds going directly toward a specific purpose. In this situation the Entitlement funds are intended to primarily be used to significantly strengthen the Company’s balance sheet and provide funds towards: Establishing the clinical and regulatory support teams and to prepare the Company’s MagSense® HER 2 breast cancer imaging agent for the next phase of development including manufacturing of materials;The Company’s business development activities, working capital, corporate activities, and offer costs.The proceeds will allow the Company to enable advancement to the next stage of clinical development in relation to the MagSense® HER 2 breast cancer imaging agent and move towards an IND (investigational new drug) application, which the Board views as having the potential to generate significant shareholder value.Shares issued under the Entitlement Offer are free of any brokerage costs which would typically be payable when buying on market.

Question – How much funds will the company raise as part of this Entitlement offer?
The company is targeting a raise of approximately A$2.44M via the entitlement offer.

Question – Can I take-up more than my full allocation?
The company is offering a Top-up Facility, whereby shareholders who take up their Entitlements in full may apply for Additional Shares. Applications for additional shares may be subject to scale-back as the board retains full discretion over this decision.

Question – How will the shares under the Entitlement Offer be ranked against existing shares?
New shares issued as part of the Entitlement will rank equally with existing fully paid ordinary shares in the company quoted on the ASX, with the same voting rights, dividend and other entitlements.Question – What’s the minimum or maximum amount I can participate?There is no minimum.You will be allocated 1 new share for every 8 shares you hold.To calculate your full allocationFor example, you hold 100,000 shares, thus your full entitlement is 12,500 sharesCalculation: (100,000 shares you hold / divide by 8 = 12,500 new shares) under the Entitlement at an issue price of $0.017 per share = $212 and you incur no brokerage.However, you may apply for more than your maximum allocation via the top-up facility.

Question – Can I download my personalised payment form online?
Yes you can, see instructions belowHow to obtain your personalised payment form online (BOARDROOM)To access the online system at https://www.investorserve.com.au/, you will need to provide your Securityholder Reference Number (SRN) or Holder Identification Number (HIN) and postcode and follow the instructions provided including making payment by BPAY® for the securities you wish to subscribe for.If you are unable to access https://www.investorserve.com.au/, please contact the Company’s share registry on 1300 737 760 (in Australia) or +61 2 9290 9600 (outside Australia).*Make sure you have your SRN/HIN handy. Your HIN or SRN can be found on your holding statement and other security holder communicationsFor further questions relating to the offer, ‘how to subscribe’, or your payment details please contact Stevan Adzic (Peloton Shareholder Services). – 0401 639 114, reply to this email or email [email protected] Peloton Shareholder Services is not in a position to be able to make any formal recommendation to you as to the suitability of this offer to you or whether you should take it up or not and would recommend that you seek advice from your financial adviser before making any decision.