Cellmid : Appendix 4D and Half Year Accounts

Name of Entity Cellmid Limited

ABN 69 111 304 119

Half year ended 31 December 2016

Previous corresponding period 31 December 2015

The following information should be read in conjunction with both the Financial Report for the year ended 30 June 2016 and the Interim Financial Report for the half year ended 31 December 2016 and the attached auditors' review report.

This Appendix 4D is prepared in accordance with ASX Listing Rule 4.2A.3.

Financial Results

31 Dec 2016 $
Revenue from ordinary activities for the period	Up	56%	to	$2,179,924
Loss from ordinary activities after tax for the period attributable to members	Down	13%	to	($1,510,541)
Net Loss after tax for the period attributable to members	Down	13%	to	($1,510,541)

No interim dividend was paid and it is not proposed to pay any dividends.

Net Tangible Assets

Current Period 31 Dec 2016	Previous Period 31 Dec 2015
Net tangible assets per ordinary share	0.48 cents	0.43 cents

The company did not gain or lose control over any entities during the half year period.

OPERATING RESULTS AND REVIEW OF OPERATIONS

Revenue for the Consolidated Entity increased by 56% to $2,179,924 for the six months ending 31 December 2016 compared with the same period last year (31 December 2015: revenue of $1,393,643). The Consolidated Entity incurred an after-tax loss attributed to members of $1,510,541 for the half year ending 31 December 2016 down 13% from the same period last year (31 December 2015: loss of $1,728,141). The Consolidated Entity continued to make significant progress in all three of its wholly owned subsidiaries; Lyramid, Kinera and Advangen as outlined in the following operational report.

LYRAMID LIMITED

Lyramid Limited (Lyramid) is engaged in the commercialization of the Consolidated Entity's midkine (MK) antibody assets, including their application in therapeutic programs as well as the MK diagnostic portfolio. MK is an important growth factor highly expressed during embryonic development and it modulates many important biological interactions.

Driving its diagnostic opportunities since 2009 the Consolidated Entity built up extensive clinical evidence on MK's role in early cancer diagnosis and signed three licenses and a large number of collaborations to commercialise these findings. During the reporting period Lyramid received $146,586 income from royalties and sales of its MK diagnostic kit (MK ELISA).

Pacific Edge licensed MK as one of the biomarkers in their bladder cancer diagnostic test (CxBladder®) in 2010. During the half year ended 31 December 2016 Pacific Edge paid to the Consolidated Entity $92,421 in royalties, up 50% from the same period last year (31 December 2015: royalties of $61,660).

The number of material milestones Pacific Edge reported during the first half on FY2017 included broadening reimbursement opportunities in the USA and expanding the utility and use of CxBladder®. In October 2016, Pacific Edge became Approved Provider to Tricare Health Plan Networks in the US, which provides health care to 9.4 million beneficiaries of the US Military Health system.

In October 2016 CxBladder® Monitor was adopted as a replacement for cystoscopy for low risk patients monitored for recurrence of bladder cancer by the Waitemata District Health Board. In December 2016, clinical study results of the same test, CxBladder® Monitor, were accepted for publication in the American Journal of Urology. The study confirmed strong performance (93% sensitivity and 97% negative predictive value) of the test and the potential of it to replace cystoscopy in low risk patients. Monitoring bladder cancer patients is one of the most significant market opportunities for CxBladder® as many patients have up to 24 visits to their urologist over a 5 year period, and may also have lifelong monitoring for recurrence.

MK has an important role in cell growth, cell migration and cellular adherence. These functions are relevant to therapeutic opportunities for Lyramid in cancer, inflammation, autoimmunity, ischemia, nerve growth/repair and wound healing. Since 2010 the Consolidated Entity, together with collaboration partners from commercial and research organisations, built an extensive portfolio of pre-clinical evidence and has been able show that its MK antibodies may be important therapeutic agents in multiple cancer indications, acute and chronic kidney disease, autoimmunity and adhesion driven diseases. During the reporting period Lyramid continued to build on this evidence in glioblastoma, bone and kidney disease.

In August 2016, the Consolidated Entity reported on new research indicating that its midkine antibodies (MK antibodies) improve bone quality and fracture healing in an animal model of osteoporosis. The study was conducted and published by Lyramid collaborators at the University Medical Centre in Ulm, Germany, on the therapeutic benefit of MK antibodies in the important clinical setting of osteoporosis.

The study was led by Dr Astrid Liedert at the Institute of Orthopedic Research and Biomechanics, University Medical Center Ulm and the results were published in PLoS ONE. (Haffner-Luntz M et al., Inhibition of Midkine Augments Osteoporotic Fracture Healing. PLoS One. 2016 Jul 13;11(7):e0159278. doi: 10.1371/journal.pone.0159278. PMID: 27410432).

The results followed a previous publication from the same group showing that treatment with Lyramid's MK antibody accelerated bone fracture healing in otherwise normal rodents. The publication in August 2016 demonstrated that MK antibodies were also effective in accelerating bone healing in osteoporotic settings, and therefore may benefit elderly patients with fragile bones that are prone to debilitating and sometime fatal fractures. Especially at risk are post-menopausal women with over 30% experiencing osteoporotic fractures after the age of 50. The Consolidated Entity filed a patent application earlier this year covering its MK antibodies for fracture healing and restoring bone loss due to osteoporosis.

In October 2016 Lyramid reported the results of its preclinical collaboration with Complutense University, Spain, showing that its proprietary MK antibodies are effective in improving tetrahydrocannabinol (THC) treatment response in animal models of cannabinoid resistant glioblastoma multiforme; one of the most common and aggressive forms of brain cancer. In the current study Lyramid's collaborators, led by Professor Guillermo Velasco, observed that MK antibodies, in combination with the cannabinoid THC, inhibited tumour growth in gliomas that are resistant to THC. Overcoming THC resistance highlights a potential treatment strategy using MK antibodies to enhance glioblastoma sensitivity to treatment, and provides a strong rationale for the continued clinical development of MK antibodies to treat brain cancer in combination with cannabinoids.

Lyramid's scientific advisors have been instrumental in steering the company's clinical development plan during the reporting period, in addition to driving engagement by key opinion leaders from relevant clinical and scientific fields.

KINERA LIMITED

Kinera Limited (Kinera) is engaged in the commercialization of the Consolidated Entity's midkine protein assets in ischemia related diseases. Ischemic conditions include acute myocardial infarction and stroke amongst other diseases. During the reporting period Kinera has developed clinical validation strategy in an undisclosed orphan disease indication that is primarily driven by ischemic events. Lyramid has engaged with relevant research partners to accelerate this promising development program.

ADVANGEN LIMITED

During the half-year ended 31 December 2016 Advangen Limited (Advangen) sold products largely to pharmacies, hair salons and through direct to consumer channels and received total revenue of $2,007,230, up 65% compared with the same period last year (31 December 2015:

$1,216,254). For the first time, quarterly sales exceeded $1 million during 1Q2017, contributing to the strong growth during the half-year.

Advangen has continued to implement its business development, marketing and advertising initiatives globally and anticipates that these initiatives will continue to drive revenue growth throughout 2017.

Importantly, Advangen signed a distribution partnership in the USA in July 2016 with Colour Collective, a specialist in the launch of high end hair brands. The USA is important for Advangen as the largest market for hair loss treatments with sales of around US$3.5 billion annually. Global hair loss sales are estimated to be around US$7 billion per year. Topical treatments account for US$2.3 billion, of which minoxidil (mostly for men) based products are the largest revenue generators. Advangen's FGF5 inhibitor hair loss products are formulated for men and women. This is particularly important as almost half those suffering from hair loss are women without a safe and effective treatment alternative.

Since the signing of the partnership with Colour Collective in July 2016 the global branding and packaging of the évolis® hair loss products have been completed and the first set of these products, évolis® REVERSE, was launched in November 2016. An extensive public relations campaign in October resulted in editorial features and mentions in the Daily Mail, WWD, Allure, Men's Health and Prevention magazines, amongst others. Significantly, évolis® REVERSE was named as Top Ten Grooming Product by Men's Health Magazine (USA) in 2017.

During the reporting period, in addition to rolling out its USA e-commerce strategy, Advangen has also commenced a comprehensive outreach to high end retailers and hair salons. Partnerships are expected to come online during the course of calendar 2017.

In Australia, Advangen continued to implement its comprehensive national marketing and advertising campaign with strong growth in pharmacy and e-commerce sales. Australian sales increased by 195% during the reporting period, mostly due to strong sell through in pharmacies. Pharmacy distribution has increased and reached approximately 1,200 active