Dear Shareholders

It is my pleasure to formally open the annual report to Race Oncology Shareholders for the period ended 30 June 2020. It’s been a highly successful year as regards progress in reframing the opportunity for Bisantrene in Acute Myeloid Leukemia (AML) and a range of other cancers. With the recently reported Phase II Bisantrene data and independent work which highlighted the expanded potential role for the drug, we are increasingly confident of the value that Bisantrene offers patients and prescribers.

The year can be described as one of significant evolution, with the Company shifting its strategic plan, as well as shoring up it’s leadership resources and capital to support the investments we’ve made – and our future plans.
Clinically, Race recorded a substantial milestone when in June 2020 we reported that management expectations had been far exceeded by impressive new Bisantrene data. A 40% patient response rate was observed in the 10- person, investigator-led, single agent, Israel-based AML trial, conducted by Professor Arnon Nagler. Furthermore, the trial showed Bisantrene was safe with no unexpected toxicities occurring. These data have demonstrated the utility of Bisantrene in the modern clinical context and build on our drug’s extensive historical data.

Strategic plan – the new 5-path strategy was shared in November 2019, and it’s construction has greatly enhanced the risk/reward outlook for Race. We remain committed to progressing Bisantrene as an effective treatment for AML in adult and paediatric populations and as a way to treat Measurable Residual Disease (MRD), a risk factor greatly influencing patient survival after human stem cell transplantation. We have also identified breast and ovarian cancers as indications with robust historical data associated with Bisantrene’s utility. In sum, the new strategy greatly enhances the commercial opportunities for Bisantrene, capitalises on its history and minimises clinical risk through pursuing multiple relevant development paths.

Leadership – we have a highly capable Board, Management team and strong partnerships with select expertise to help us to optimally execute on our strategies. In this last year we were joined by Dr Daniel Tillett, as both an Investor and Director, then later as our Chief Scientific Officer. Daniel has made a significant contribution to this year’s results, particularly in helping to reshape our strategic plan. Dr Bill Garner who helped found Race Oncology stepped down from the Chair role and it’s been my privilege to succeed him. More recently our former CEO Dr Peter Molloy left the business, so Daniel and I have been sharing executive responsibilities. We were honoured to have the Chair of our Clinical Advisory Board, Professor Borje Andersson join the Board as Non- Executive Director in January this year. Finally, we were also pleased to introduce Mr Phillip Lynch, a former J&J executive to the Board in a non-Executive capacity.

Capital management – our financial year shows a loss of $3.8m vs a loss of $3.7m in 2019. Cash on hand has increased significantly, owing to investment in 2020 from prominent biotech investors, including Merchant Opportunities Fund which invested $1.8m in March 2020, before making follow-on investments of $3m in July and $1.5m in August. Thanks to these investments, Option exercise and a prudent approach to financial management, Race has started the 2021 financial year with cash reserves of $1.7m increasing to $5.8m as at August 27, 2020. This allows Race the ability to fund its immediate clinical trial plans and to pursue broader activities as outlined in the 5-path plan.

Clinical progress – while I mentioned the significant results we realised through the Nagler Israeli trial, we have been additionally energised by the published City of Hope (COH) findings around the Fat mass and Obesity- associated (FTO) protein and its role in regulating RNA expression as reported in the June Cancer Cell publication by Su R. et al. We look forward to studying the COH work and to further evaluating the potential for Bisantrene with regard to FTO inhibition. More broadly, our Clinical team, led by Professor Borje Andersson, has assembled a cadre of global expertise to ensure that our Clinical plans are optimised, and our opportunities realised. We are fortunate to have such world-class advisors.

It’s been a pivotal year for Race. We’re now proving out our view that Bisantrene represents a relevant, high- potential cancer drug. The team at Race is committed to fulfilling Bisantrene’s potential by further progressing our corporate strategy and positioning the business to ensure that patients, potential pharma partners, clinicians and our investors, might all participate in the potential that Bisantrene affords.

Dr. John Cullity, Executive Chairman