Proteomics International Laboratories : December 2021 Quarterly Activities Report and Appendix 4C

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ASX Release

27 January 2022

ASX code: PIQ

Quarterly Activities Report

Proteomics International Laboratories Ltd (Proteomics International; ASX: PIQ), a medical technology company at the forefront of precision medicine and predictive diagnostics, is pleased to provide the following update on its business activities for the three months to 31 December 2021.

• PromarkerD significantly outperforms standard of care tests in predicting future kidney function decline: Clinical study shows PromarkerD identifies 84% of patients who declined - all of whom were missed by current gold standard tests
• Clinical utility study demonstrates appeal of PromarkerD testing to clinicians: Survey finds
  PromarkerD significantly impacts physicians' prescribing and monitoring decisions, helping to inform treatment decisions to improve clinical outcomes for patients
• PromarkerD distribution network expands to Britain: Distribution agreement with Apacor Limited (UK) to bring PromarkerD test to patients in England, Scotland and Wales
• FDA advises regulatory pathway for PromarkerD in US: PromarkerD test system to follow a De Novo classification pathway for regulatory approval
• Engagement with Key Opinion Leaders (KOLs): Proteomics International is finalising appointments to a clinical advisory board amid ongoing engagements with national and international professional bodies and clinical experts in diabetes and nephrology
• Proteomics International secures major analytical services contract for pharmacokinetic testing: circa $400,000 contract will see the Company test a novel drug for degenerative and inflammatory diseases
• R&D tax incentive and manufacturing funding: Cash reserves further strengthened by $1.2 million in research and development tax incentive and a $100,000 manufacturing voucher
• Director appointments: Dr Robyn Elliott and Neville Gardiner welcomed to the Board as independent, non-executive Directors

OPERATIONAL HIGHLIGHTS

Proteomics International's activities fall into three key areas:

1. commercialisation of PromarkerD, the predictive test for diabetic kidney disease (DKD)
2. R&D for new diagnostic tests using the PromarkerTM pipeline
3. analytical services on a commercial basis

Proteomics International Laboratories Ltd

ABN 78 169 979 971

Box 3008, Broadway, Nedlands, WA 6009, Australia

T: [phone] | E: [e-mail] | W: www.proteomicsinternational.com

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i) Commercialisation of PromarkerD

PromarkerD significantly outperforms standard of care tests in predicting future kidney function decline

[ASX: 5 November] A study demonstrated that the PromarkerD test for diabetic kidney disease outperforms current standard of care tests in predicting the onset of diabetic kidney disease. The research compared the PromarkerD test to standard of care tests, the estimated glomerular filtration rate (eGFR) and urinary albumin:creatinine ratio (ACR) during a four-yearfollow-up period.

The clinical study involved retrospective analysis of more than 850 community-based patients with type 2 diabetes from the Fremantle Diabetes Study Phase II. Results showed PromarkerD correctly identified 84% of patients with normal kidney function who went on to experience kidney function decline in the next four years. Critically, all of these patients would have been missed by the eGFR and ACR tests which constitute the current gold standard of care under the global KDIGO (Kidney Disease Improving Global Outcomes) guidelines for risk classification. PromarkerD also identified 89% of patients with abnormal kidney function who declined further over the course of the study.

The study found patients classified by PromarkerD as high risk were 21 times more likely to develop diabetic kidney disease within four years than those classified as low risk. Patients classified as moderate risk by PromarkerD were eight times more likely than low-risk patients to develop the disease. The study was presented at Kidney Week 2021, the annual meeting of the American Society of Nephrology (ASN), in November.

Clinical utility study demonstrates appeal of PromarkerD testing to clinicians

[ASX: 18 October] As reported in the September quarterly update, a clinical utility study demonstrated that PromarkerD can help inform doctors' treatment decisions to improve clinical outcomes for patients with type 2 diabetes. The US-based web survey of 400 primary care physicians and endocrinologists found the PromarkerD test significantly impacted physicians' prescribing and monitoring decisions.

The analysis showed that PromarkerD tests were more important to physicians than the current standard-of-care tests - eGFR and ACR. More than three-quarters of physicians reported they were very or extremely likely to use PromarkerD in the future.

Senior author of the study Dr Alexander Turchin, an endocrinologist at Boston's Brigham and Women's Hospital, said "When presented with moderate or high-riskPromarkerD results, physicians were more likely to implement renoprotective changes-suchas increasing monitoring frequency, prescribing SGLT2 inhibitor drugs ('gliflozins') or replacing ibuprofen-thanif they did not have the PromarkerD test results. These changes can help avoid end-stageinterventions such as dialysis and kidney transplant. In contrast, when presented with low-riskPromarkerD results, the likelihood of aggressive treatment and health care resource utilisation reduced."

The results were presented at AMCP Nexus, a managed-care pharmacy conference in Denver, USA, in association with Boston Healthcare Associates and specialist US endocrinologists, in October.

PromarkerD distribution network expands to Britain

[ASX: 23 November] Proteomics International signed a distribution agreement with Apacor Limited (UK) to bring its PromarkerD test for diabetic kidney disease to patients in England, Scotland and Wales. The distribution agreement provides medical diagnostics company Apacor Limited with the right to sell the immunoassay version of the PromarkerD test.

Apacor have 25 years of experience in medical and analytical diagnostics and specialise in bringing ground-breaking technologies to their customers. Importantly, Apacor have strong relationships with government and professional healthcare bodies across the UK; dialogue with these bodies to introduce PromarkerD to the UK is now ongoing.

Proteomics International Laboratories Ltd

ABN 78 169 979 971

Box 3008, Broadway, Nedlands, WA 6009, Australia

T: [phone] | E: [e-mail] | W: www.proteomicsinternational.com

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Apacor managing director Anthony Bellm said he was excited about PromarkerD and being able to partner with Proteomics International to bring the test to the UK. "This world-firsttest offers huge benefits for the growing number of people living with diabetes in Great Britain, as well as significant savings to the NHS," he said. The term of the agreement with Apacor is for two years, extendable for additional periods of one year by mutual agreement, exclusive to England, Scotland and Wales, and exclusive to the PromarkerD immunoassay (IA) version of the test.

FDA advises regulatory pathway for PromarkerD in US

[ASX: 24 November] Proteomics International received notification from the United States Food and Drug Administration (FDA) that the PromarkerD test system should follow a De Novo classification pathway for regulatory approval. This guidance follows the Company's 513(g) application to the FDA in April 2021 [ASX: 29 April], with the response delayed due to COVID-19 related resource limitations. The De Novo pathway for medical device marketing in the US was added by the FDA to address novel devices of low to moderate risk, such as blood tests, that do not have a valid predicate device, i.e. there is no similar device already approved.

Proteomics International is now preparing for a full product application to the FDA proposing the PromarkerD test system as a Class IIa IVD (In Vitro Diagnostic). It is expected the Company will submit this application in Q1 CY22, with the FDA timeline for review of such applications being approximately 12 months. Whilst the Company is pursuing FDA approval, the primary route to market for PromarkerD in the US remains the LDT (Laboratory Developed Test) path through CLIA (Clinical Laboratory Improvement Amendments) certified labs, which allows sales to commence prior to any FDA approval.

Engagement with Key Opinion Leaders (KOLs)

Proteomics International is pursuing multiple avenues to drive the global uptake of PromarkerD through engagement with key professional bodies and clinical experts in diabetes and nephrology. In addition to conference presentations described above, the Company is finalising discussions with several KOLs to form a clinical advisory board and will provide further information on this subject in due course.

Proteomics International was also an industry partner on the recently announced successful grant application to establish an Australian Centre for Accelerating Diabetes Innovations (ACADI), which has been awarded $10 million over four years from the Australian Government's Medical Research Future Fund. Proteomics International's involvement in ACADI is subject to contract with terms and roles to be determined. The centre combines diabetes expertise from across Australia and aims at improving the lives of people living with diabetes, including addressing diabetic kidney disease.

PromarkerD - Outlook 2022

The Company is pleased to advise that it continues to advance its discussions with potential US/Global laboratory partners to provide PromarkerD to diabetes patients. Entry into the US market would mark a major milestone for the Company as it executes its global commercialisation strategy for PromarkerD.

Nonetheless, Proteomics International has been experiencing delays to its supply lines due to the variant waves of the Covid-19 pandemic. Whilst these issues are not currently material for the Company, they have delayed the ISO 13485 manufacture of the PromarkerD assay [ASX: September Quarterly] and have the potential to affect engagement with diagnostics facilities and subsequent roll-out of PromarkerD.

The Company was expecting to achieve first sales of PromarkerD in Italy during the quarter under its agreement with Medical Horizons [ASX: 16 October 2020], however, this has been delayed and the Company is now targeting first sales in Italy during the first half of CY22.

Sales arising from the second distribution agreement for the PromarkerD immunoassay kit, which is

Proteomics International Laboratories Ltd

ABN 78 169 979 971

Box 3008, Broadway, Nedlands, WA 6009, Australia

T: [phone] | E: [e-mail] | W: www.proteomicsinternational.com

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with Zotal Ltd for Israel [ASX: 12 November 2020], remain dependent on the completion of the

transfer to ISO 13485 kit manufacturing [ASX: September Quarterly].

Proteomics International will continue to pursue national/international regulatory and reimbursement approvals for PromarkerD and the Company will provide further guidance as material milestones are achieved.

Further information about PromarkerD is available through the web portal (www.PromarkerD.com).

To visit the PromarkerD virtual product display please see: www.PromarkerD.com/product

1. R&D for new diagnostic tests using the Promarker™ pipeline

During the quarter, Proteomics International continued to advance several of its diagnostic research and development projects using the Company's Promarker™ technology platform [See Annual Report 2021]. Over the coming months the Company expects to update the market on a number of key developments. Proteomics International believes its Promarker™ platform has broad applicability and the potential to produce multiple new diagnostic tests to address significant unmet medical needs.

Diagnostics - Endometriosis

The Company notes the previously announced research agreement with the University of Melbourne and the Royal Women's Hospital [ASX: 4 August 2021] to develop a world-first test for endometriosis has also been affected due to Covid-19. Proteomics International is pleased to confirm the laboratory analysis is continuing to progress, however, this clinical validation study has been affected by supply and critical equipment availability issues. Preliminary results are still expected in Q1 CY22 and if successful, the Company is confident this program will receive significant commercial interest.

Diagnostics - Outlook 2022

The Company looks forward to announcing further results from its other diagnostic tests in development during the course of 2022.

iii) Analytical services

Proteomics International secures major analytical services contract for pharmacokinetic testing [ASX: 16 December] Proteomics International was awarded a major pharmacokinetic testing contract as part of its growing partnership with Linear Clinical Research. The circa $400,000 contract will see Proteomics International test a novel drug for degenerative and inflammatory diseases on behalf of the Australian arm of pharmaceutical company Sironax Ltd.

The study is part of a Phase I clinical trial examining the safety, tolerability and pharmacokinetics of the drug, and will be undertaken over the next 12 months. It comes amid strong global demand for pharmacokinetic testing, the study of what happens to drugs once they are inside the body, including the rate at which they are absorbed, distributed, metabolised and excreted.

Analytical Services - Outlook 2022

The Company currently anticipates growing demand for its analytical services during the course of 2022 and is looking forward to updating the market as and when agreements are entered into.

FINANCIAL AND CORPORATE HIGHLIGHTS

Proteomics International's business model is to continue the commercialisation of PromarkerD whilst using its PromarkerTM technology platform to create a pipeline of novel diagnostic tests, and offset the cash burn from R&D and product development through its analytical services revenue,

Proteomics International Laboratories Ltd

ABN 78 169 979 971

Box 3008, Broadway, Nedlands, WA 6009, Australia

T: [phone] | E: [e-mail] | W: www.proteomicsinternational.com

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coupled with the R&D tax incentive rebate. This diversified model has shown its strength in the current economic climate and enables the group to continue to make optimum use of its resources.

Revenue & Expenditure

Proteomics International achieved receipts from customers for the December quarter of $354,000 (September quarter: $373,000).

Receipts continue to be driven by revenue from analytical services. In particular, the Company has observed a significant increase in demand for its pharmacokinetic testing services (related to clinical trials), and renewed interest in biosimilars testing - an area that was negatively affected in FY21 by the Covid-19 shutdowns in markets such as India.

The net operating cash outflow for the December quarter was $0.1 million (September quarter: $1.16 million). Expenditure centred on the following areas:

• Business development and commercialisation costs for the roll-out of PromarkerD
• Manufacturing costs for the PromarkerD immunoassay kit
• Regulatory and reimbursement activities to support PromarkerD commercialisation
• R&D for projects in the PromarkerTM diagnostics pipeline

Proteomics receives $1.2 million in R&D tax incentive

[ASX: 14 December] Proteomics International's cash reserves were strengthened by the receipt of $1.2 million in research and development tax incentive. In 2020-21, Proteomics International spent $2.85 million on R&D, enabling the Company to receive an Australian Government rebate of $1,240,156.

Company awarded $100,000 manufacturing funding

[ASX: 3 November] Proteomics International was awarded a $100,000 voucher to support the manufacture of clinical diagnostic tests in Western Australia. This will allow the Company to establish local manufacturing quality control capabilities for PromarkerD, supporting the future large-scale manufacture of the test for Australia and the South-East Asia region.

The funding is made possible through the MTPConnect WA Life Sciences Innovation Hub MTP Manufacturing Voucher Program, and was announced by WA State Development, Jobs and Trade Minister Roger Cook. The $100,000 voucher will be matched dollar for dollar by Proteomics International, with the project to be completed over nine months.

ASX Listing Rule 4.7C

Payments at item 6.1 of the Appendix 4C of $119,000 relate to normal remuneration of Executive and Non-Executive Directors.

Cash position

At 31 December 2021 the Company had cash reserves of $4.5 million (September $4.4 million). These reserves were strengthened by an R&D tax incentive rebate of $1.2 million received in the December quarter. The Company is confident that its diversified business model places it in a strong financial position to fund its objectives for CY22.

Director appointments

[ASX: 16 November; 26 October] Proteomics International welcomed Dr Robyn Elliott and Neville Gardiner to its Board as independent, non-executive Directors.

Mr Gardiner is a seasoned finance professional with over 30 years' experience advising Boards of public and private companies, most recently as a partner of Deloitte. Dr Elliott is an Executive Director at CSL Behring, a subsidiary of CSL Limited [ASX: CSL], with a proven track record in product development, clinical trials, regulatory affairs, audits, quality management, project management and operational strategy.

Mr Gardiner has assumed the role of Chair, following the retirement of Proteomics International Laboratories Ltd Chairman Terry Sweet at the 2021 AGM. Mr Sweet was instrumental in taking the

Proteomics International Laboratories Ltd

ABN 78 169 979 971

Box 3008, Broadway, Nedlands, WA 6009, Australia

T: [phone] | E: [e-mail] | W: www.proteomicsinternational.com

5/6	Part of the PILL Group