Risk Explanation Additionally, should INOVIQ elect to commercialise its products directly in any countries, it would be required to invest significant time and resources to build direct sales, distribution and marketing capabilities, and it would be required to ensure compliance with all legal and regulatory requirements for sales, marketing and distribution. Furthermore, even if INOVIQ does not achieve commercialisation of any of its products and services, it may not be able to sustain its efforts or otherwise achieve commercialisation to a degree which would support the ongoing viability of its operations. A failure to successfully develop and commercialise INOVIQ’s products could lead to a loss of opportunities and adversely impact on INOVIQ’s operating results and financial position. In those countries where INOVIQ seeks to commercialise its products through distributors or other third parties, INOVIQ will rely heavily on the ability of its partners to effectively market and sell its products and services Intellectual Property Protection The value of INOVIQ is strongly linked to its intellectual property. As of 30 June 2023, the Company has 21 granted patents and 2 pending patent applications across hTERT, Molecular NETs, BARD1 and SubB2M technology platforms. Maintaining this value is therefore dependent on INOVIQ’s ability to protect its intellectual property. There is no guarantee that INOVIQ’s patent rights comprise all of the rights that INOVIQ needs to be entitled to freely use and commercialise its products. If third party patents or patent applications contain claims infringed by INOVIQ’s technology and these claims are valid, INOVIQ may be unable to obtain licences to these patents at a reasonable cost, if at all, and may also be unable to develop or obtain alternative technology. If such licences cannot be obtained at a reasonable cost, the business could be significantly impacted. Furthermore, the enforceability of the patents owned by INOVIQ may be challenged and INOVIQ’s patents could be partially or wholly invalidated following challenged by third parties. Each jurisdiction has its own patent laws and particular requirements that need to be met for the grant of a patent. There may be changes to patent law or its interpretation by the courts in a particular jurisdiction from time to time, which may have an impact on patents in the relevant country. There is no guarantee that any further patent applications will be granted or that the Company’s owned and licensed patent rights comprise all the rights that the Company should have acquired to be entitled to freely use and commercialise its products. Competition INOVIQ operates in the life sciences and diagnostic industries that are highly competitive, and include companies that have substantially greater financial, technical, research and development, and marketing resources than INOVIQ. There are companies that compete with INOVIQ’s efforts to develop, validate and commercialise diagnostic products and other product candidates. INOVIQ’s competitors may discover, develop, validate and commercialise products in advance of INOVIQ, and/or products that are more effective, more economical or materially superior to those developed by INOVIQ. Consequently, with the potential for rapid advance in technology, INOVIQ’s current or future technologies and products may become obsolete or uncompetitive, resulting in adverse effects on INOVIQ’s revenues, margins and ultimately its profitability. Government and regulatory factors The diagnostic industry is regulated in Australia, the United States, Europe and other countries in which INOVIQ may conduct business operations or seek to commercialise its products. INOVIQ has not yet formally engaged with the TGA (Australia), FDA (USA), Notified Bodies (Europe) and other regulatory authorities to establish the optimal regulatory pathway/s and clinical study plans for its diagnostic products in key jurisdictions. While INOVIQ is not aware of any reason why its cancer diagnostic products would not be able to advance to clinical validation stage, INOVIQ cannot guarantee that this will occur in a timely manner or at all. Additionally, INOVIQ may fail to gain marketing or regulatory approval in Australia, the US, EU, or other jurisdictions for its cancer diagnostics products. Directors’ Report 26 INOVIQ Limited
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