1 February 2021

PolyNovo enters Italy

PolyNovo is entering the Italian medical device market through the appointment of Medival as the Company’s distribution partner in Italy.

Italy is the fourth largest medical device market in Europe with a value circa US$10 billion. The Italianmarket is innovative and mature, with a high demand for advanced products. NovoSorb BTM offers improved functional and cosmetic outcomes for patients.

Prior to appointing Medival, PolyNovo has been working with surgeons at a major hospital to have NovoSorb®BTM included in an important new national guideline. The hospital has implanted two BTM and early feedback is very positive.

Medival are focused on providing advanced and innovative medical devices to critical care and surgical specialties. Theyhave an established customer base throughout Italy accessing approximately 1500 plastic surgeons and have 25 reps on the road and one dedicated product manager. NovoSorb BTM rounds out their product portfolio ensuring they can offer their surgeons a complete range. http://www.medival.it

20 January 2021

PolyNovo enters Turkey

PolyNovo is excited to announce the Company’sentry into Turkey with the appointment of Incomed Saglik Hiz and its medical sales channel LotuS®, as our distributor. This expansion in the Europe-Middle East-Africa (EMEA) region is a significant step in bringing NovoSorb BTM to a significant number of surgeons and patientsin the region.

LotuS®has an established product portfolio and sales relationships within wound and burn treatment.They have over 10 years’ experience launching innovative devices through their extensive customer base. LotuS®are also the distributors of Suprathel and they are familiar with the benefits of synthetic products in the treatment of complex surgical wounds.NovoSorb® BTM will complete their plastic and reconstructive surgery offering.

LotuS began operations in2006 supplyingmedical devices to the Turkish market.The company concentrates on wound and burn treatments and has a number of complimentary products designed for use in burn surgery, general surgery and plastic surgery. They have a large sales force comprised of direct sales, dealers and sub-dealers covering the whole of the Turkish region. LoutuS have strong relationships with KOL's and are present in the key burn centres throughout the country and are therefore well positioned to successfully promote NovoSorb BTM.https://www.lotusmdc.com/

Turkey has seen significant economic growth over the past 10 years,and they are building a modern medical industry. Turkey has a population of 82 million people and a GDP of $761B (USD) in2019. PolyNovo sees good medium-term opportunities in Turkey.

20 January 2021

PolyNovo enters Poland

PolyNovo is excited to announce the Company’s entry into Poland with the appointment of Hortho Medical Innovations as its exclusive distributor. Hortho distributes modern and innovative devices for medical reconstruction.They distribute a number of complimentary bio-absorbable implant technologies and work closely with key opinion leaders inplastic/reconstructive surgery.

Hortho have a direct team servicing all of Poland and plan to add dedicated personal to support their NovoSorb®BTMsales and marketing.http://www.hortho.pl/

Hortho Medical Innovations specialise in distributing innovative surgical devices and havea large network of surgeons. Theirexperience in selling biomaterials and complex surgical implants makes them an excellent growth partner for PolyNovo.

Poland is the sixth largest country in the European Union with a population of more than 38 million, and a medical device market valued at over $2.2 billion.

12 January 2021

Interim Trading Update

• H1 FY21 up 31% on H1 FY20
• Strong sales Q1 FY21 up 75% on Q1 FY20
• Slower than expected sales in October and November
• Strong December sales exceeded budget in US, NZ, and Taiwan

New Accounts – Direct Markets

• H1 FY21 opened 35 new accounts across all direct markets
• CY20 opened 109 new accounts representing 89% growth on CY19
• Strong platform growth during a pandemic evident by significant account acquisition

United States

• Q1 FY21 up 70% on Q1 FY20
• Q2 FY21 up 16% on Q2 FY20
• 1H FY21 up 41% on 1H FY21
• Sales for the month of December 2020 exceeded budget
• Hired 12 experienced and dedicated Territory Managers and 1 Sales Director in 1H FY21
• Received more Requests for Proposal (RFP) in last 3 months than previous 9 months
• Signed two GPOs and a number of large strategic hospitals
• Ongoing progress with GPO’s but has slowed due to COVID-19, however we expect to see movement in Q3 FY21
• Participated in a few large IDN RFP’s and anticipate agreements in place in Q3 FY21
• Expanded our military presence with the addition of Portsmouth Naval
• Added a second account in Canada that has used BTM for a challenging case through the Health Canada Special Access Program
• Webinars and virtual conferences are driving new accounts
• Recruiting additional sales staff so further growth expected from new geographics

Other Countries

• First sale to Taiwan in December and executed sales to Singapore, Finland and South Africa
• New Zealand and Taiwan sales for the month of December 2020 exceeded budget
• Entered new markets Greece, Belgium, Netherlands, Luxembourg, Sweden, Finland, and Taiwan
• Our DACH/Benelux distributor has clinical evaluations in 30 new accounts underway
• UK is building on its customer base with 6 clinical evaluations underway
• First clinical evaluation performed in Ireland

19 November 2020

PolyNovo enters Belgium, Netherlands, Luxemburg, Sweden

PolyNovo is excited to announce the Company’s entry into Belgium, Netherlands, Luxemburg (Benelux) and Sweden through an extension of our partnership with PolyMedics Innovations (PMI) in Germany.

PMI have been an excellent partner for us in Germany, Switzerland and Austria (DACH) with their sales exceeding projections to date and showing signs of further growth. PMI have recently placed their fourth stock order with PolyNovo since January 2020.

PMI’s strong key opinion leader network has been a key success factor. Their track record this year convinced PolyNovo they can quickly bring further growth to our European revenues through these four additional countries. The Benelux and Swedish region have a population of circa 39million people

US FDA approves Pivotal Trial IDE

PolyNovo is excited to announce the US FDA has approved the pivotal trial investigation device exemption (IDE).

This approval allows PolyNovo to begin patient recruitment once the various hospital Independent Review Boards (IRB) grant approval. We will utilise 20 sites and recruit 150 patients. PolyNovo has prequalified the sites and we are in advanced contracting with these sites. Further details of thesites and study details will be released in due course.

28 October 2020

Taiwan FDA approval for PolyNovo

PolyNovo is excited to announce the approval of NovoSorb BTM by the Taiwan FDA for sale in Taiwan.

PolyNovo said it has also contracted with Evermed,a Taiwan based distributorto sell BTM.

Managing Director, Paul Brennan said,“This is an exciting developmentfor PolyNovo. Taiwan hasan advanced health system and has a population of circa 23 million concentrated in three regions. The dermal matrix market in Taiwan has good potentialfor us in reconstructive surgery, trauma and burns.”

Mr. Brennan went on to say that “Evermed is a very good partner and has 20 sales staff focused on medical devices. The company has well established relationships with hospitals and key opinion leaders throughout Taiwan.”

In order to start selling, Evermed needs to lodge reimbursement data with the health authority, typically a three-month process, to achieve billing codes for use by the hospitals. First sales are anticipated circa March 2021.

PolyNovo appoints distributor for Finland.

PolyNovo is excitedto announce the appointment of Innova Medical Oy, in Helsinki, to sell NovoSorb® BTM in Finland.

Innova Medical Oy service a broad range of surgery; plastics, trauma, general and burns; already supplying a range of wound and second degree burn products.

There have already beenfour surgical applications of NovoSorb BTM with three surgeons on a chronic leg stump wound, burns and scar revision.

The surgeons have reachedskin graft closure stage on two of these with excellent results to date.

21 April 2020

PolyNovo is pleased to share the summary of results for the CP-002 Feasibility Study to assess the safety and effectiveness of NovoSorb®Biodegradable Temporizing Matrix (BTM) in the treatment of severe skin burn injuries. This trial was a prospective, multicentre, single-arm, open label, traditional feasibility study conducted in the USA, where NovoSorb®BTM was used under an FDA Investigational Device Exemption (IDE).

This 12-month clinical study recruited 15 subjects with burns within the range 10%–70% total body surface area (TBSA) across four leading burn centres:

• University of CaliforniaDavis (Sacramento),
• University of Tennessee (Memphis),
• University of South Florida (Tampa) and
• Wake Forest University (Winston-Salem)

Fourteensubjects (aged 21–67 years, mean 45.1% TBSA deep dermal/full-thickness burns) had BTM applied to treat thermal/contact burns. One subject consented but was deemed ineligible during screening and did not have BTM applied. The first subject was enrolled in March 2017 and enrolment ended in August 2018.

Seven subjects completed their 12-month follow-up assessments and seven subjects were withdrawn: two subjects died due to serious adverse events unrelated to BTM, one subject was withdrawn by the investigator, and four subjects were lost to follow-up.

The co-primary effectiveness endpoints were BTM ‘take’ rate assessed after integration at the time of sealing membrane removal, and split-thickness skin graft (SSG) ‘take’ rate at 7–10 days after application. The results available for 12 subjects indicate that BTM provided effective temporary wound coverage and integrated into the wound bed with a mean BTM take rate of 95.22%, median of 98.89%,and a range of 78% to 100%. Similarly, SSG take rates available for 11 subjects were high with a mean of 97.53%, median of 100%, and a range of 75.0% to 100.0%.

Wound closure was assessed at various intervals after skin grafting. Mean wound closure rates at 1 month varied across anatomical locations in a range from 94.8% to 100%, increasing to a range of 99.8% to 100%at 3 months, demonstrating success of the skingrafting procedures used to provide definitive wound closure in these large wounds.

No new risks related to the use of BTM were identified in this study. Infections were common and occurred in 12 of 14 (85.7%) subjects, with 7 subjects (50%) experiencing wound infections at BTM-treated sites. These rarely resulted in removal of BTM, which occurred in 2 subjects (14.3%).

As a consequence of these results, PolyNovo anticipates our Pivotal Study IDE to be approvedby the US FDA in June 2020.

11 March 2020

Coronavirus: Little impact on PNV

PolyNovo wishes to inform  the market that the coronavirus is unlikely to have a direct impact on its business or sales going forward. In particular, the Company:

• does not source raw materials from China and it has multiple supplier redundancy built in to our supply chain
• does not, therefore, anticipate any significant supply chain disruption
• has enough raw materials to run two shifts of production and we anticipate running two shifts from April 2020. The inventory build that will result from this is in response to the anticipated product demand for the remainder of the year
• has sufficient inventory of finished product on shelf in the US and Melbourne, New Zealand, and adequate stocks in the UK/EU to meet anticipated sales for a significant period
• does not sell into China and our major customers are based in the US, Australia, New Zealand, UK and Western Europe.
• anticipates surgeries will continue in a virus challenged world as most of the procedures are not elective surgery. The majority of BTM use is in emergency, trauma or extensive surgery applications
• sees little reason to change its view on anticipated product demand going forward
• is developing  a comprehensive digital marketing program to maintain our surgeon reach which should mitigate to some degree any conference cancellations or if hospitals impose restrictions on sales representative access. The Company will have regard to this when conside ring additional sales headcount going forward

26 February 2020

BTM sales up 129% H1 FY20, AND run rate accelerating

PolyNovo said today that NovoSorb BTM sales for the half year were 129% higher than the same period last year. However, the Company said the rate of increase in sales is growing in existing markets and should grow further as new markets come on stream. BTM sales in January 2020 were more than three times the sales in January 2019. While this is encouraging, especially in the US which had the largest month on month growth of any region, as previously advised we expect sales to be  lumpy as each market develops. Based on year to date performance the company now expects that NovoSorb BTM sales for FY20 should comfortably double FY19.

PolyNovo’s CEO, Mr Paul Brennan said,“The past half year has been exciting for all of us because many areas of our business are experiencing rapid and dynamic growth. My personal highlights for the first half,apart from the sales growth referred to above include:

• CE Mark approval with a quick entry into the UK/Ireland and DACH region quickly followed by first patients
• Awarded breakthrough technology status by US FDA which will assist our BARDA PMA burn study
• Continued expansion of the sales teams in Australia, US and UK
• Our response to the White Island tragedy in New Zealand and bush fires in Australia
• Commenced the build of the hernia/breast cleanroom facility and delivery of manufacturing machinery
• Appointment of Dr. Robyn Elliott as Non-Executive Director bringing extensive global experience
• Completed the expansion and refurbishment of the head office to accommodate a growing team
• Expansion of the US office to accommodate more support staff for our sales team.”

28 January 2020

UK/Ireland first NovoSorb BTM Surgeries

PolyNovo is pleased to announce NovoSorb BTM been applied to the first two patients in the UK. One patient was treated for Necrotising Fasciitis in an English NHS hospital. A second patient was treated for a scalp defect. Several other NHS hospitals are in the process of selecting patients for surgeries.

In anticipation of the launch in the UK/Ireland, PolyNovo had stock on the ground in England.

Over the past 14 months PolyNovo has been establishing a direct sales infrastructure and business processes in the UK to be ready for the anticipated demand for NovoSorb BTM.

We are pleased to announce the appointment of two additional sales staff for the UK and Ireland and the recruitment of a Marketing Manager for UK and Europe who will be based in England. The new staff are being inducted and trained and expected to be in the field by March.

Further update on Europe

As a further update on Europe, further surgeries have happened in Switzerland and Germany since our release on 22 January. Our distributor, PMI, has also placed a second order.

PolyNovo’s CEO, Mr Paul Brennan said,“We have now achieved first surgeries in England, Germany and Switzerland. Last week I visited several surgeons with our UK Sales Manager and I was impressed by the excitement that NovoSorb has generated. The first surgeries in England so soon after registration are a reflection of doctor enthusiasm.”

22 January 2020

• First product order from PolyMedics Innovations (PMI) for Germany, Austria and Switzerland
• First patient treated in Germany
• Several surgeries planned this week and next

PolyNovo has received its first orders of BTM from PMI for use in Germany, Austria and Switzerland. The first orders for NovoSorb BTM were shipped to hospitals in preparation for the first surgery.

PolyNovo is pleased to announce the first surgery in Europe using BTM occurred on Sunday in Germany. There are a number of surgeons planning on using BTM this week and the coming fortnight.

At the launch of BTM at the 38th Jahrestagung der Deutschsprachigen  Arbeitsgemeinschaft für Verbrennungsbehandlung (DAV) Burns Conference in Austria last week, numerous surgeons made clear their intention to use the product in the near future. That is now happening.

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20th January 2020

Regulatory approvals

Approved

Class III Medical device

• US FDA 510(K)
• CE Certification Europe, UK, Ireland
• TGA Inclusion
• NZ MedSafe
• South Africa
• India
• Malaysia
• Singapore
• Israel

In Progress

• South Korea
• Taiwan
• Mexico
• Kuwait

Clinical Trial update

CE Burn trial is complete with final publication of results due by end of March 2020

• BARDA funded Feasibility trial results will be published ~ March 2020 sites were

– Wake Forest Baptist Health, Winston-Salem,

– University of Tennessee Medical Centre, Memphis

– University of California Davis Medical Centre, Sacramento

– Tampa General Hospital, Tampa

– Arizona Burn Center, Phoenix

– Lehigh Valley Hospital, Allentown

• BARDA funded Pivotal burn trial will commence once US FDA approves protocol recruitment commencing ~June 2020.
• Granted US FDA opening “Break through technology” assessment pathway for  NovoSorb BTM which will accelerate US FDA feedback, guidance and support of the trail program

Pipeline Development

NovoSorb BTM is currently on sale

• Unique biodegradable purely synthetic
• Market expansion for the use of dermal scaffolds

Pipeline development – a platform technology

• Hernia devices preparing for manufacturing scale up with equipment deliveries in progress and factory build, complete factory May 2020 US entry early CY2021
• Breast products advanced design and preliminary commercial manufacturing process mapping
• Drug Elution 5 drugs at initial exploration stages for mix/extrusion/consistency. Output is good, requires further R&D resources to develop robust elution test data. Accelerate development in FY21
• Beta Cell Technologies Diabetes treatment with islet cell implants into a BTM dermal depot. BTM works well in pig studies with Islet cells secreting insulin. Stem cell derived Islet cell testing nearing completion with human trials anticipated in CY2020.

Production Capacity

• Have run 2 shifts to build inventory
• Currently hold 6 months forward inventories on a rolling forecast basis
• Capacity increase through:

– Centralised larger polyol reactor in combined Hernia/BTM facility (unit 1)

– Centralised Foam production in dedicated room (particle reduction) for Hernia and BTM

– Centralised semi-automated packaging machine for all products, ordered and awaiting delivery

– New cutting machines significantly lift production rate and capacity

– Waste reduction program

– mixing process for foam, tighter production timelines and flows

– Improvements to QC testing regimes now that we have higher levels of data to support processes

15 November 2019

Address by Chairman – Mr David Williams

Excerpts:

The FY18 BTM sales were $1.7m and for the half year 31 December 2018, they were $3.7m but by year end FY19 they were $9.3M.

What you can expect from FY20? Forecasting with our growth profile is difficult, but for us, also commercially sensitive. For these reasons we will not be providing a forecast, we will not say which hospitals we are supplying and will not say what orders we have from the US Military.

However, to give you some limited guidance we have previously announced sales months greater than $1m which you can extrapolate to $12m pa. However, we are seeing significant growth in all markets. In the four months to October 2019 we are more than 100% ahead of the four months to October 2018. In general, we are seeing month on month growth, so October 2019 BTM sales are more than 100% higher than October 2018 sales. In other words, we expect the sales run-rate to increase as the months go on.

Today we have 3 sales people, in Australia (1 this time last year) and 12 sales people in the US (5 last year). You should read this as ‘the best is yet to come’ because most of these new hires are recent. We are confident that a new hire can pay for themselves within months and be significantly value adding within a year. For this reason, we expect the sales run-rate to increase over time. Reinforcing this, we are actively hiring new staff in the US. If Australia can carry 3 staff then it is feasible California alone might justify 3 staff. Accordingly, our ability to service and penetrate markets in the US, Australia and New Zealand is growing month on month. With the CE Mark approvals we also expect near term sales in UK/Ireland from 3 of our own sales staff and near term sales in Germany, Austria and Switzerland with our partner PMI. Subject to CE documentation we expect sales in all these geographies before the end of the year. We know of surgeons in these regions who are aware of BTM and keen to trial it.

My confidence for the financial year ahead comes from a significant increase in sales and market penetration. It also comes from hearing leading surgeons clearly articulate our value proposition on why BTM offers advantages over incumbent biologics, and seeing the patient outcomes where they return to their lives without the long term restrictions imposed by alternatives to BTM. Our product is life changing and lifesaving.

Capital

With good profit margins and growing sales, we have good cash flow and a declining cash burn. We previously stated that we will break even this year and we are close to that objective.

Board Fees

At this AGM we are asking to increase the pool size for Director remuneration from $400,000. A recent study published by the ACSI showed the average pool size for ASX 200 companies was $1m and for ASX 300 companies $750,000. Our proposal for $600,000 is below these averages.

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Remuneration

We have agreed a new LTI with our CEO along with a modest base salary and STI. The LTI involves being allocated shares over three years end 1 October 2022, but the shares do not vest till 1 October 2022, and then half are escrowed for 12 months and the other half for 24 months. In each of the 3 years, the shares will not be allocated unless the market capitalisation of the business is above $2 billion for a continuous period of 3 months.

Diversity

The Board is committed to diversity and recognises it is good for business but the guiding principles for us is to have a working board. By this I don’t mean having executives on the Board but rather experienced people to better guide and assist management, to add strategic thinking, to open doors and to add depth of the talent available to the company.

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PolyNovo gains Singapore regulatory approval

PolyNovo is pleased to announce the successful registration of NovoSorb BTM with the Health Sciences Authority of Singapore.

Sales of NovoSorb BTM in Singapore will occur only after the appointment of a distributer.

PolyNovo will be attending and displaying at the Asian Burns Conference in Singapore 14-16 August and this will be an excellent forum to meet with key surgeons and distributors across the region.

PolyNovo is still awaiting CE certification.

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