OK, so earlier this week we learned the details of the $PAR cap raising:

• $14m via 73.7m shares at $0.19
• An SPP target raising $2.0m at $0.19 or a 2.5% discount to the VWAP during 5 days before the SPP close.

Each share has 1 attaching option at $0.2375 expiring at the earlier of 1/12/26 or 20 busines days after the release of the Interim Analysis (IA).

Each option, if exercised, then has a "piggy-back" option of $0.38, expiring in 30 April 2029.

The company says the raising was "significantly upsized' from the initial target of $8.0m due to "strong investor demand".

I've trawled through the release to try and understand why the change of strategy, as previously, it was clear they would await the IA - due in August (now maybe September) before raising. That's because a positive IA would be a potentially very significant SP catalyst given the market potential for an approved OA treatment.

I think part of the clue for the raising is in the bit I wrote above that the IA was due in August,... now maybe in September. With a quarterly cash burn of $11m and only $11m in the bank, things are getting tight, raising the reliance on the Obsidian convertible facility. More on that below.

Now $PAR does not explicitly state that it had changed its strategy, but the language in the announcement makes the rationale clear.

The company emphasised that the raising would “extend runway through the interim analysis and into the post-interim period,” rather than simply funding up to that milestone. This indicates a shift from the earlier approach of waiting for the interim results before raising capital, to ensuring the business is fully funded across that key inflection point and into the next stage, including NDA preparation. Management now seem to be prioritising certainty of funding over trying to time the market around the interim readout - but in truth they don't explain what is driving the change of heart.

A second factor highlighted was balance sheet flexibility. The company noted that part of the proceeds would be used to repay its Obsidian convertible note facility and “reduce reliance on future drawdowns.” This suggests the raise was partly motivated by a desire to avoid depending on potentially more expensive or restrictive funding sources if conditions deteriorate or if the interim result is less favourable than expected. By raising equity now, Paradigm strengthens its financial position ahead of a high-risk period. (Still that doesn't explain the change of position).

Finally, the structure of the deal shows an attempt to retain upside if the interim analysis is positive. The attaching options are explicitly designed to “accelerate additional capital inflows in the event of a positive clinical outcome.” Combined with the comment that the raise provides “funding flexibility through the upcoming interim analysis,” this indicates a more balanced strategy: secure funding upfront, reduce risk, and still leave room to raise further capital on better terms if the data is strong.

I think it is important to remember just how expensive the converitble debt facility is to $PAR. And as the SP of $PAR has fallen the terms of the facility which seek to protect the lender, become more onerous and likely more dilutive to $PAR shareholders.

So, it seems likely that the capital raising, the partial paydown of Obsidian, and the desire to be less reliant on Obsidian is in the best interests of shareholders.

To recap, here's where we are at:

Pre-raise: ~470–480m shares

Post-placement: ~545–555m shares

Post-SPP: ~555–565m shares

Fully diluted (incl. options): ~620–640m shares

So, it is a significant but not disastrous dilution.

And what does it buy? Well the latest OpCF burn was $11m for the quarter. So, at that rate, the raising buys 4-5 months space, with the options to likely buy another 5-6 months on top of that, and the "piggy back" options up to another 6-8 months.

So the raise + options + "piggy back" options is potentially enough to get through to an NDA decision, and therefore provides greater clarity of funding. Of course, that's provided the path to the NDA is straighforward and all options are exercised. Any delays in the process, and it won't be enough from my quick assessment.

Investment Decision

I have added to my small "research position" to a small 0.6% holding at $0.173 this morning, and will mull over whether to take this up to 1% by participating in the SPP.

Looking back at the earlier CT data, it is tempting to think this one has a good chance. However, the results were under-powered and can easily go either way in a controlled Phase 3 trial. So, this remains very much a binary bet. However, it is one I am prepared to place a small stake on.

Disc: Held

Disappointing to see a cap raise at this time… I had understood (and hoped) that paradigm was funded at least to interim results. It must be pretty touch and go for them to pass the hat around now!

About time for an update on this one… I’ve been following this (and holding for gods sake) for more than 5 years. It’s finally approaching the proper binary event that is phase 3 trial results. Looks as though the interim results will be released in August. If they are positive I expect a massive spike in share price which will no doubt be followed by a cap raise to see them through the rest of the trial etc. given my confidence in the drug itself I might accumulate a little more between now and then.

The market cap sitting at 100mil for a business I believe is on the cusp of a disease modifying drug for OA is in @Strawman’s terms ‘an asymmetric bet’. That said, it’s a binary outcome and that’s enough to reasonably keep plenty of people on the sidelines.

‹ Paradigm Achieves 50% Patien...

PARAIGM

BIOPHARMA

ASX RELEASE

31 March 2026

V

Paradigm Confirms 50% of Patients Dosed in Phase 3 OA Trial

Enabling Progress Toward Interim Analysis

Key Highlights

• 50% of patients now dosed in the global PARA_OA_012 Phase 3 study, which is on track consistent with the company's previously announced time schedule.
• Interim dataset is on schedule to undergo independent statistical analysis, with results expected in August 2026.
• Phase 3 study design closely aligns with the patient population and protocol of the successful PARA_OA_008 trial, while strengthening data quality and managing placebo response.

Paradigm Biopharmaceuticals Ltd. (ASX: PAR) ("Paradigm" or "the Company") a late-stage drug development company focused on delivering new therapies to address unmet medical needs, is pleased to announce that 50% enrolment in the global Phase 3 PARA_OA_012 clinical trial has now been achieved, with dosing of the final participants required for inclusion in the interim analysis dataset having commenced.

Participants are followed from first dosing through the Day 112 assessment period in accordance with the study protocol.

Following completion of the Day 112 assessments, the interim dataset will undergo data cleaning and independent data monitoring committee (DMC) statistical analysis, which is expected to take approximately four to six weeks. Based on the current study timeline, Paradigm expects the interim analysis results to be delivered in August 2026.

The PARA_OA_012 study is designed to enrol 466 participants globally, with patients randomised to receive injectable pentosan polysulfate sodium (iPPS) or placebo. The primary endpoint of the study is the change in weekly average of daily pain at Day 112, with secondary endpoints including improvements in physical function, imaging-based structural outcomes, and safety assessments.

Patient recruitment continues across Paradigm's global network of clinical trial sites spanning Australia, the United States, Europe and Asia, as progression toward 100% enrolment is expected in the coming months.

The PARA_OA_012 Phase 3 trial has been designed to closely align with Paradigm's earlier PARA_OA_008 study, which demonstrated clinically meaningful improvements in pain and function. The two studies utilise a comparable patient population, the same dosing regimen of injectable pentosan polysulfate sodium (iPPS), and similar study duration and endpoints. Maintaining this consistency in trial design is intended to reduce development risk and support comparability across the clinical program.

Importantly, the PARA_OA_012 protocol also incorporates key learnings generated across Paradigm's earlier clinical studies, including the PARA_OA_002 dose-ranging study. These

PAR released an update the other day on their canine trial showing significant clinical, radiological and biomarker improvements. Full PLOS ONE publication here

This was a small trial of only 20 dogs which was randomised and placebo controlled. It was not blinded. There were statistically significant improvements in clinical outcomes. You could easily argue it wasn’t powered enough to read anything into the results

Difficult to react too much into it given those limitations but all broadly supportive of Pentosan being effective in this population.

If you want to get excited, the same biomarker reductions have been noted in a human trial last month.

While nice to have a bit more of a suggestion that the phase 3 human trial is likely to successful, it doesn’t really move the needle

I don’t hold but it would be great for so many people if this turns out to be an effective treatment for Osteoarthritis. Including those brave shareholders.