Investors

Company Charters & Policies

Please select a document from the below list to jump to that item:

1. Charter of the audit and risk committee.
2. Charter of the remuneration committee.
3. Corporate governance policy
    - Continuous disclosure.
4. Corporate governance policy
    - Securities trading
    - Directors.
5. Board charter.

1. Charter of the Audit and Risk Committee - 23 April 2004

Contents

1. Introduction
2. Objectives
3. Composition
4. Meetings
5. Powers
6. Responsibilities
7. Reporting
8. Review of the Charter

1. Introduction

1.1 This Charter governs the roles, responsibilities, composition and membership of the audit and risk committee of the Company (Committee).

1.2 The operation of the Committee is also governed, where applicable, by the constitution of the Company.

2. Objectives

The purpose of the Committee is to assist the board of directors of the Company (Board) in fulfilling its corporate governance and oversight responsibilities by:

(1) monitoring and reviewing:

(a) the integrity of financial statements;

(b) the effectiveness of internal financial controls; and

(2) making recommendations to the Board in relation to the appointment of external auditors and approving the remuneration and terms of their engagement.

3. Composition

3.1 Members

The Committee must only consist of non-executive directors. The Board intends as soon as is possible and appropriate for the Company that the Committee must have a minimum of 3 members, with the majority of members being independent directors. However, the Committee has been established initially with 2 non-executive directors.

The members of the Committee will be appointed and removed by the Board.

3.2 Expertise

Each member of the Committee must be able to read and understand financial statements.

The Committee must also include:

(1) at least 1 member who is a qualified accountant or other financial professional with experience of financial and accounting matters; and

(2) some members who have an understanding of the pharmaceutical industry.

Members of the Committee must have an appropriate level of understanding of the principles of corporate governance, including knowledge of the Australian Stock Exchange Limited's (ASX) Principles of Good Corporate Governance and Best Practice Recommendations.

3.3 Chairman and Secretary

The Board will appoint an independent chairman to the Committee (Chair).

The Company Secretary will act as secretary of the Committee (Secretary) unless determined otherwise by the Board.

4. Meetings

4.1 Frequency

The Committee will meet as frequently as required but must, at a minimum, meet twice per year.

The Secretary must call a meeting of the Committee if requested to do so by any member of the Committee.

4.2 Agenda and notice

The Secretary will be responsible, in conjunction with the Chair, for drawing up the agenda (supported by any necessary explanatory documentation) and circulating it to Committee members prior to each meeting. The Committee Secretary must notify members of the Committee of the date, time and location of Committee meetings as far in advance as possible, but not less than 7 days before the meeting.

4.3 Quorum

A quorum for Committee meetings will be at least 2 members, save that 1 of the members of the quorum must be an independent director.

4.4 Minutes

The Secretary is responsible for taking minutes of each meeting and distributing them to the Committee members as soon as practicable.

4.5 Attendance

The Committee may invite any person to attend part or all of any meeting of the Committee as it considers appropriate. Voting at Committee meetings is restricted to Committee members.

5. Powers

5.1 Access

The Committee has unrestricted access to management, internal and external auditors and all company records for the purpose of carrying out its responsibilities under this Charter.

The Committee must be provided with all necessary access to the internal audit function without the presence of management.

The Committee will meet with external auditors, in the absence of management, as often as required, but not less than once a year.

5.2 Investigations

The Committee has the power:

(1) to conduct any investigations it considers necessary; and

(2) seek explanations and additional information.

The Committee has the power to engage any independent experts it requires to help it fulfil its duties. Costs associated with this will be borne by the Company.

6. Responsibilities

6.1 Risk oversight and management policies

The Committee is responsible for providing the Board with advice and recommendations regarding the ongoing development of risk oversight and management policies that set out the roles and respective accountabilities of the Board, the Committee, management and the internal audit function.

The policies should cover the areas of oversight, risk profile, risk management, compliance and control and assessment of effectiveness.

6.2 Risk management and risk profile

The Committee is responsible for:

(1) providing the Board with advice and recommendations regarding the establishment and implementation of:

(a) a risk management system; and

(b) a risk profile for the Company that describes the material risks (including financial and non-financial risks) which the Company faces;

(2) reviewing the effectiveness of the Company's implementation of the risk management system at least once a year; and

(3) regularly reviewing and updating the Company's risk profile.

The Committee is responsible for ensuring that the appropriate senior managers have established and implemented a system for identifying, assessing, monitoring and managing risk throughout the organisation. The system is to include the Company's internal compliance and control systems.

6.3 Internal audit function

The Committee is responsible for establishing an internal audit function whose purpose is to analyse the effectiveness of:

(1) the Company's risk management and internal compliance and control system; and

(2) the implementation of the Company's risk management and internal compliance and control system.

6.4 Internal auditors

The responsibilities of the Committee include:

(1) reviewing the results and effectiveness of the internal audit programs;

(2) recommending the scope of the internal audit for Board approval;

(3) reviewing and approving the appointment and dismissal of senior internal audit executives;

(4) ensuring the internal audit function is independent of the external auditor;

(5) ensuring that the internal audit function has all necessary access to management and the right to seek information and explanations;

(6) receiving summaries of significant reports to management prepared by internal audit, the management response and the recommendations of internal audit;

(7) ensuring no management or other restrictions are placed on the internal auditors; and

(8) ensuring the internal auditors are adequately resourced.

6.5 External auditors

The responsibilities of the Committee include:

(1) providing a link between the external auditors and the Board;

(2) reviewing the performance and independence of the external auditors;

(3) reviewing procedures for the selection and appointment of external auditors;

(4) reviewing and providing recommendations on the rotation of external audit engagement partners;

(5) recommending the appointment, remuneration and terms of engagement of the external auditors;

(6) recommending the scope of the external audit for Board approval;

(7) reviewing and providing oversight of audit reports prepared and issued by the external auditors;

(8) ensuring that no management or other restrictions are placed on the external auditors; and

(9) determining what non-audit services are to be provided by the external auditor.

6.6 Review of financial reports

Duties of the Committee include:

(1) reviewing financial statements for accuracy, adequacy and clarity and ensuring they reflect a true and fair view as a basis for recommendation to and adoption by the Board;

(2) reviewing financial statements for adherence to accounting standards and policies and the requirements of the ASX Listing Rules and the Corporations Act 2001;

(3) reviewing accounting policies adopted and any changes made to them;

(4) reviewing management processes supporting external reporting;

(5) discussing any significant matters arising from the audit, management judgements and accounting estimates with management and internal and external auditors; and

(6) reviewing, and where necessary challenging, the actions and judgment of management in relation to all financial reports.

7. Reporting

7.1 Reporting to the Board

The Committee must report to the Board, at the first Board meeting subsequent to each Committee meeting, regarding the proceedings of each Committee meeting, the outcomes of the Committee's reviews and recommendations and any other relevant issues.

The minutes of the Committee meetings must be included in the papers for the next full Board meeting subsequent to each Committee meeting.

7.2 Annual report

The Committee must provide the Board with advice and recommendations regarding the appropriate material and disclosures to be included in the corporate governance section of the Company's annual report which relates to the Company's audit policies and practices.

7.3 Public availability of materials

The Committee must ensure that this charter is made publicly available on the Company's website in a clearly marked corporate governance section.

8. Review of the Charter

This Charter shall be reviewed annually and revised by the Board as required.

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Charter of the Remuneration Committee - 23 April 2004

Contents

1. Introduction
2. Objectives
3. Composition
4. Meetings
5. Objectivity
6. Roles and responsibilities
7. Reporting
8. Review of the Charter

1. Introduction

1.1 This Charter governs the composition, membership, roles and responsibilities of the remuneration committee of the Company (Committee).

1.2 The operation of the Committee is also governed, where applicable, by the constitution of the Company.

2. Objectives

The purpose of the Committee is to provide the board of directors of the Company (Board) with advice and recommendations which enable the Board to:

(1) set in place remuneration policies which are designed to attract and retain senior managers and directors with the expertise to enhance the performance and growth of the Company; and

(2) ensure that the level and composition of remuneration packages are fair, reasonable and adequate and, in the case of executive directors and senior managers, display a clear relationship between the performance of the individual and the performance of the Company.

3. Composition

3.1 Members

The Committee must consist of a minimum of 2 members, with the majority of members being non-executive and preferably independent directors.

The members of the Committee will be appointed and removed by the Board.

3.2 Expertise

Members of the Committee must have an appropriate level of understanding of:

(1) the principles of corporate governance, including knowledge of the Australian Stock Exchange Limited's (ASX) Principles of Good Corporate Governance and Best Practice Recommendations;

(2) the disclosure requirements under the Corporations Act 2001 and the ASX Listing Rules in respect of executive and director remuneration; and

(3) the complexities involved in negotiating and determining executive remuneration packages.

3.3 Chairperson and Secretary

The Committee must be chaired by an independent director (Chair).

The Company Secretary will be the secretary of the Committee (Secretary) unless determined otherwise by the Board.

3.4 Liaison

The principle liaison between executive management and the Committee will be the CEO.

4. Meetings

4.1 Frequency

The Committee will meet as frequently as required but must, at a minimum, meet twice per year.

The Secretary must call a meeting of the Committee if requested to do so by any member of the Committee.

4.2 Agenda and notice

The Secretary will be responsible, in conjunction with the Chair, for drawing up the agenda (supported by any necessary explanatory documentation) and circulating it to Committee members prior to each meeting. The Secretary must notify members of the Committee of the date, time and location of Committee meetings as far in advance as possible, but not less than 7 days before the meeting.

4.3 Quorum

A quorum for Committee meetings will be at least 2 members, save that 1 of the members of the quorum must be an independent director.

4.4 Minutes

The Secretary is responsible for taking minutes of each meeting and distributing them to Committee members as soon as practicable.

4.5 Attendance

The Committee may invite any person to attend part or all of any meeting of the Committee as it considers appropriate. Voting at Committee meetings is restricted to Committee members.

5. Objectivity

5.1 No member of the Committee will be directly responsible for providing advice or recommendations concerning the level or composition of his or her remuneration to the Board.

5.2 The Committee has the right to seek internal and external advice when it considers such advice necessary in order to fulfil its responsibilities.

5.3 The Committee must ensure that it obtains sufficient information to enable it to make informed decisions with respect to the advice and recommendations it provides to the Board.

6. Roles and responsibilities

6.1 Executive remuneration policy

The Committee is responsible for providing the Board with advice and recommendations regarding the ongoing development of an executive remuneration policy that:

(1) is designed to attract, maintain and motivate directors and senior management with the aim of enhancing the performance and long-term growth of the Company; and

(2) clearly sets out the relationship between the individual performance and remuneration.

The Committee must review the remuneration policy and other relevant polices on an ongoing basis and recommend any necessary changes to the Board.

The Committee is also responsible for providing the Board with advice and recommendations regarding the Company's polices on recruitment, retention and termination.

6.2 Executive remuneration packages

The Committee is responsible for reviewing and providing recommendations to the Board with respect to the remuneration packages of senior management and executive directors.

The Committee must ensure that the remuneration packages of senior management and executive directors:

(1) display a balance between fixed and incentive pay which is tailored to the Company's short and long-term performance objectives;

(2) provide for a link between rewards and the performance of the Company and individual; and

(3) are consistent with the Company's remuneration policy and any other relevant Company policies.

The Committee is also responsible for advising and providing recommendations to the Board with respect to executive superannuation arrangements.

6.3 Incentive schemes

The Committee is responsible for reviewing and providing recommendations to the Board with respect to:

(1) the Company's policies for incentive schemes; and

(2) the incentive schemes of senior managers and executive directors.

The Committee will assist the Board in the development of appropriate benchmarks for use in designing incentive schemes.

6.4 Non-executive remuneration

The Committee is responsible for providing advice to the Board with respect to non-executive directors' remuneration.

The remuneration packages of non-executive directors should generally be fee based and the Committee must ensure that there is a clear distinction between the structure of non-executive directors' and executive directors' remuneration.

6.5 Termination payments

The Committee is responsible for providing advice and recommendations to the Board on the Company's termination and redundancy polices and the payments made to outgoing directors and senior managers.

Where applicable termination payments must be agreed in advance and must contain clearly defined provisions regarding the consequences of early termination. The termination payments of the Company's chief executive officer must always be agreed in advance.

7. Reporting

7.1 Reporting to the Board

7.2 Annual report

7.3 Public availability of materials

The Committee must ensure that a copy of this Charter is made publicly available on the Company's website in a clearly marked corporate governance section.

8. Review of the Charter

This Charter shall be reviewed annually and revised by the Board as required.

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Corporate Governance Policy – Continuous Disclosure - 23 April 2004

Contents

1. Introduction
2. Application
3. Objectives
4. Continuous disclosure legal considerations
5. Policy
6. Disclosure Officer
7. What is Material Information?
8. Contraventions and penalties
Schedule 1 Examples

1. Introduction

1.1 This Policy imposes obligations and procedures on all directors, employees and consultants of the Company to ensure the timely and balanced disclosure of all material matters concerning the Company.

1.2 The Policy was adopted by the Board on 23 April 2004.

2. Application

2.1 The Policy applies to all directors, employees and consultants of the Company.

3. Objectives

3.1 The objectives of this Policy are to:

(1) ensure that the Company is able to meet its continuous disclosure obligations under the ASX Listing Rules;

(2) establish internal procedures so that all directors, employees and consultants understand their obligations to disclose material information to ensure:

(a) all investors and participants in the market have equal and timely access to material information concerning the Company;

(b) all Company announcements are factual and presented in a clear and balanced way; and

4. Continuous disclosure legal considerations

4.1 Chapter 3 of the ASX Listing Rules deals with the continuous disclosure requirements that a listed company must satisfy. In particular, Listing Rule 3.1 states that once a entity is or becomes aware of any information concerning it that a reasonable person would expect to have a material effect on the price or value of the entity's securities, the entity must immediately tell ASX that information (Material Information).

There is, however, an exception to the disclosure of information in Listing Rule 3.1. This exception applies when:

(1) a reasonable person would not expect the information to be disclosed;

(2) the information is confidential and ASX has not formed a view otherwise; and

(3) one or more of the following applies;

(a) it would be a breach of law to disclose the information;

(b) the information concerns an incomplete proposal or negotiations;

(d) the information is generated for the internal management purposes of the Company; and/or

(e) the information is a trade secret.

4.2 The Listing Rules also provide that if the ASX considers that there is or is likely to be a false market in an entity's securities, and asks the entity to give information to correct or prevent a false market, the entity must give ASX the information needed to correct or prevent the false market.

4.3 Examples of information that would need to be disclosed under ASX Listing Rule 3.1 are set out in paragraph 7.7 and Schedule 1 to this Policy.

5. Policy

5.1 The Board of Directors of the Company are required to appoint a Disclosure Officer to administer the Company's Continuous Disclosure Policy.

5.2 As soon as directors, employees or consultants become aware of information:

(1) that is not generally available (ie the information in question has not been included in any Annual Report, ASX Release or other publication of the Company); and

(2) which may be price sensitive (ie it is likely to have a financial or reputation impact upon the Company that may be considered material),

they must provide to the Disclosure Officer the following information:

(3) a general description of the matter;

(4) details of the parties involved;

(5) the relevant date of the event or transaction;

(6) the status of the matter (eg final/negotiations still in progress/preliminary negotiations only);

(7) the estimated value of the transaction;

(8) the estimated effect on the Company's finances or operations; and

(9) the names of any in-house or external advisers involved in the matter.

5.3 Information or presentations provided to, and discussions with, analysts, professional bodies or any other person, are also subject to the Continuous Disclosure Policy.

5.4 Material information must not be selectively disclosed (eg to analysts, professional bodies, the media, customers or any other person) prior to being announced to the ASX. If any director, employee or consultant is proposing to present any material information to professional bodies, journalists or customers, they should ensure that copies of their material are provided to the Disclosure Officer prior to presenting that information externally.

5.5 All inquiries from analysts must be referred to the Disclosure Officer. All material to be presented at an analyst briefing must be approved by or referred through the Disclosure Officer prior to briefing.

5.6 All inquiries from the media must be referred to the Disclosure Officer.

5.7 All media releases and material to be presented (for example at seminars) must be approved by or referred through the Disclosure Officer prior to release to journalists or other professional bodies.

6. Disclosure Officer

6.1 The Board has appointed the Company Secretary to act as the Disclosure Officer to:

(1) be responsible for disclosure to ASX; and

(2) have responsibility for communications with ASX in relation to ASX Listing Rule matters generally (in accordance with ASX Listing Rule 12.6).

6.2 The Disclosure Officer must:

(1) decide what information must be disclosed to the ASX;

(2) conduct all disclosure discussions with management;

(3) conduct all disclosure discussions with the ASX;

(4) maintain a file (Disclosure File) which must contain a record of:

(a) material that has been disclosed to the ASX (with a copy of each announcement to ASX); and

(b) potentially price sensitive information that has come to the attention of the Disclosure Officer and has not been disclosed to the ASX, together with the reasons for that non-disclosure;

(5) submit reports to each regular Board meeting, setting out the matters disclosed to the ASX and those matters of which the Disclosure Officer became aware that were not disclosed to the ASX and the reasons for that non-disclosure; and

(6) take such action as the Disclosure Officer considers necessary or appropriate (including the implementation of regular training sessions for relevant officers and employees) to ensure that the senior managers and their subordinates are aware of and adequately understand:

(a) the nature of the Company's continuous disclosure obligations;

(b) the responsibilities of the Company's officers and employees in ensuring compliance with its continuous disclosure obligations; and

6.3 The Disclosure Officer must immediately decide in respect of information that comes to his or her attention (either directly or from a director) whether:

(1) the information must be disclosed to the ASX;

(2) an exception which allows non-disclosure to apply; or

(3) an alternative procedure, such as whether a notice pending, trading halt or suspension of shares is appropriate in all the circumstances.

6.4 In the case of paragraphs 6.3(1) and 6.3(2), there are 3 alternatives:

(1) The Disclosure Officer believes the information is price sensitive and must be disclosed. In this case, the Disclosure Officer must:

(a) discuss the matter with management;

(b) discuss the matter with the Managing Director who may, in turn, discuss the matter with the Chairman or other directors; and

(c) prepare a letter to the ASX disclosing the price sensitive information. A copy of the letter must be sent to all directors and placed on the Disclosure File maintained by the Disclosure Officer.

(2) The Disclosure Officer is convinced the information is not price sensitive, or does not have to be disclosed because it is covered by the exceptions in Listing Rule 3.1. In this case, the Disclosure Officer must make careful notes setting out why the information has been brought to his or her attention and the reasons why the information is not price sensitive, or why the exceptions in Listing Rule 3.1 apply (as applicable). These notes must be placed on the

Disclosure File.

(3) The Disclosure Officer is not certain whether the information is price sensitive, or whether it falls within an exception. In this case, the Disclosure Officer must follow the appropriate procedures in paragraph 6.4(1) and seek external legal or financial advice.

6.5 The Disclosure Officer shall be responsible for ensuring that Company announcements:

(1) are factual;

(2) do not omit material information; and

(3) are expressed in a clear and objective manner that allows investors to assess the impact of the information when making investment decisions.

7. What is Material Information?

7.1 The Company's Disclosure Officer is responsible for making decisions about what information will be disclosed.

Materiality test

7.2 Information is material if the information would, or would be likely to, influence persons who commonly invest in securities in deciding whether to acquire or dispose of the Company's securities.

7.3 Materiality is assessed against this qualitative test, considering the Company's

business activities, size and place in the market.

7.4 A quantitative assessment may also be undertaken by the Company's Disclosure Officer as part of, but not in substitution for, the materiality test.

7.5 To ensure that there is no pre-judgment of the materiality test, directors, employees and consultants must inform the Disclosure Officer of any potentially material price or value sensitive information or proposal as soon as they become aware of it.

7.6 If an employee is any doubt about whether particular information is potentially price sensitive, they should immediately disclose the information to the Disclosure Officer.

7.7 Examples of the types of information which may require disclosure include:

(1) a change in revenue, or profit or loss, forecasts;

(2) a change in asset values, or the amount of liabilities;

(3) a change in taxation or accounting policy;

(4) a change in the attitude of significant investors to investment in the Company's shares;

(5) decisions of regulatory authorities in relation to the Company's business;

(6) relationships with new or existing significant customers or suppliers;

(7) the formation or termination of a joint venture or strategic alliance;

(8) the entry into or termination of a major contract;

(9) significant transactions involving the Company group;

(10) labour disputes;

(11) the threat, commencement or settlement of any material litigation or claims;

(12) a copy of a document containing market sensitive information that the Company lodges with an overseas exchange or other regulator and which is available to the public in that country;

(13) an agreement between the Company and 1 of its directors or 1 of their related parties; and

(14) the health of any director.

7.8 There are many other types of information that could give rise to a disclosure obligation. For example, developments in companies which are affiliated with, but not controlled by, the Company may be price sensitive when related to the Company itself. Any questions on whether particular information is price sensitive should be immediately directed to the Disclosure Officer.

8. Contraventions and penalties

8.1 Contravention

The Company contravenes its Australian continuous disclosure obligations if it fails to notify the ASX of the information required by Listing Rule 3.1 to be disclosed. If the Company contravenes this obligation by failing to notify the ASX of information:

(1) that is not generally available; and

(2) that a reasonable person would expect, if it were generally available, to have a material effect on the price or value of securities issued by the Company,

it, and its officers may be guilty of an offence under the Corporations Act.

8.2 Liability and enforcement penalties for breach

(1) The Company

If the Company contravenes its continuous disclosure obligations, it may face:

(a) if the contravention is intentional or reckless criminal liability with a monetary fine;

(b) civil liability for any loss or damage suffered by any person as a result of the Company's failure to disclose relevant information to the ASX; and

The ASIC can also institute proceedings under the ASIC Act 2001.

There is a no fault element required to establish civil liability. However, a court has power to relieve a person from civil liability if the person acted honestly and in the circumstances the person ought fairly to be excused for the contravention.

(2) Others

The Company's officers (including its directors), employees or advisers who are involved in the contravention by the Company, may also face criminal (monetary fine and/or 5 years imprisonment) and civil liability as outlined above.

(3) Enforcement

The court also has power under the Corporations Act to order compliance with the Listing Rules on the application of the ASX, the ASIC or an aggrieved person (for example, a shareholder of the Company).

(4) Unwanted publicity

Contravention of its continuous disclosure obligations may also lead to unwanted publicity for the Company and may cause damage to its reputation in the market place which may adversely impact upon the market value of its securities.

Schedule 1
Examples

In addition to the scenarios contained in the guidance note, the ASX has also included in the Listing Rules the following examples of information which would need to be disclosed under Listing Rule 3.1 if it is material:

1. A change in the entity's financial forecast or expectation.

2. The appointment of a receiver, manager, liquidator or administrator in respect of any loan, trade credit, trade debt borrowing or securities held by it or any of its child entities.

3. A transaction for which the consideration payable or receivable is a significant proportion of the written down value of the entity's consolidated assets. Normally an amount of 5% or more would be significant, but a smaller amount may be significant in a particular case.

4. A change in the control of the responsible entity of a trust.

5. A proposed change in the general character or nature of a trust.

6. A recommendation or declaration of a dividend or distribution.

7. A recommendation or declaration that a dividend or distribution will not be declared.

8. Under subscriptions or over subscriptions to an issue.

9. A copy of a document containing market sensitive information that the entity lodges with an overseas exchange or other regulator which is available to the public. The copy given to the ASX must be in English.

10. An agreement or option to acquire an interest in a mining tenement, including the number of tenements, a summary of previous exploration activity and expenditure, where the tenements are situated, the identity of the vendor and the consideration for the tenements.

11. Information about the beneficial ownership of shares obtained under Part 6C.2 of the Corporations Act.

12. Giving or receiving a notice of intention to make a takeover.

13. An agreement between the entity (or a related party or subsidiary) and a director (or a related party of the director).

14. A copy of any financial documents that the entity lodges with an overseas stock exchange or other regulator which is available to the public. The copy given to the ASX must be in English.

15. A change in accounting policy adopted by the entity.

16. Any rating applied by a ratings agency to an entity or securities of an entity and any change to such a rating.

17. A proposal to change the entity's auditor.

Note: These examples are not an exhaustive list. Employees should notify the Disclosure Officer any matters that they think may be “price sensitive” or influence an investor's decision to buy or sell securities.

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Corporate Governance Policy - Securities Trading - Directors - 23 April 2004

Contents

1. Introduction
2. Application
3. Objectives
4. Dealing in securities - legal and other considerations
5. Policy - dealing in securities
6. Notification of dealings in securities - legal and other considerations
7. Policy - notification of dealing in securities
8. Explanation of terms

1. Introduction

1.1 This Policy imposes constraints on directors of the Company dealing in securities of the Company. It also imposes disclosure requirements on directors.

1.2 This Policy was adopted by the Board on 23 April 2004.

2. Application

This Policy applies only to directors of the Company. Senior executives who are not directors and other staff of the Company and its subsidiaries (Group) may be subject to separate policies in relation to trading in securities.

3. Objectives

3.1 The objectives of this Policy are to:

(1) minimise the risk of directors of the Company contravening the laws against insider trading;

(2) ensure the Company is able to meet its reporting obligations under the ASX Listing Rules; and

(3) increase transparency with respect to trading in securities of the Company by directors.

3.2 To achieve these objectives directors should consider this Policy to be binding on them in the absence of specific exemption by the Board.

4. Dealing in securities legal and other considerations

4.1 Sections 1042B to 1043O of the Corporations Act 2001 prohibit persons who are in possession of price sensitive information in relation to particular securities that is not generally available to the public from:

(1) dealing in the securities; or

(2) communicating the information to others who might deal in the securities.

4.2 The central test of what constitutes price sensitive information is found in section 1042A. It provides that the insider trading and continuous disclosure rules apply to information concerning a company that a reasonable person would expect to have a material affect on the price or value of securities in the company (price sensitive information).

4.3 Directors of the Company will from time to time be in a situation where they are in possession of price sensitive information that is not generally available to the public. Examples are the period prior to release of annual or half-yearly results to Australian Stock Exchange (ASX) and the period during which a major transaction is being negotiated.

4.4 The risk of contravention of insider trading laws in relation to information concerning public companies was substantially reduced in 1994 with the introduction of the continuous disclosure regime. Under that regime, public companies are required to disclose all price sensitive information immediately to ASX, except in limited circumstances. The tests of what constitutes price sensitive information under the insider trading laws and under the continuous disclosure requirements are effectively identical. As a consequence, at least in theory, there is no risk of directors contravening insider trading laws as all relevant information will already have been disclosed.

4.5 There are a number of limitations and qualifications to the above. They include:

(1) the ASX Listing Rules and the Corporations Act permit companies to not disclose certain information, for example in the situation where an acquisition is being negotiated and remains confidential;

(2) information may be known to a particular director but not yet by the Company as a whole (i.e. the Board);

(3) the Company may not have yet complied with its continuous disclosure obligations in relation to a particular event or circumstance there will always be some element of delay in doing so; and

(4) directors will generally have a better feel for the performance of the Company than the public.

In these situations there is still potential for contravention. There is also the potential for an appearance of contravention even if there has not been actual contravention. This could reflect badly on the Company as well as on the director concerned.

4.6 Another circumstance that must be guarded against is where one or more directors are aware of an event or circumstance and the remaining directors are not yet aware. In such a circumstance it is important that no director deals in securities because:

(1) there is a risk that they will be found to have been guilty of insider trading even if they had no intention of committing a contravention; and

(2) of the potential for such circumstances to reflect badly on the Company.

4.7 For these reasons, the advice of the Chairman should be sought prior to any dealings taking place, and steps should be taken to ensure that the Chairman is appraised of all relevant considerations by the Continuous Disclosure Manager appointed under ASX Listing Rule 1.1, condition 12.

5. Policy dealing in securities

5.1 Directors should not deal in securities of the Company unless:

(1) they have satisfied themselves that they are not in possession of any price sensitive information that is not generally available to the public;

(2) they have advised the Chairman of their intention to do so; and

(3) the Chairman has indicated that there is no impediment to them doing so.

5.2 The Chairman will generally allow directors to deal in securities of the Company as a matter of course (unless there is in existence price sensitive information that has not been disclosed because of an ASX Listing Rule exception) in the following periods:

(1) within the period of 1 month after the release of annual or half-yearly results; and

(2) within the period of 1 month after the issue of a prospectus.

Directors should wait at least 2 hours after the relevant release so that the market has had time to absorb the information.

5.3 The periods mentioned in paragraph 5.2 are not the only times in which directors may deal in securities, and the approval of the Chairman may be sought to deal in securities outside those times. It would be unusual for the Chairman to grant approval in the period of 1 month prior to the release of such results or the issue of a prospectus. In such circumstances the Chairman will only give his or her approval after making appropriate enquiries.

5.4 Directors must not at any time engage in short-term trading in securities of the Company.

5.5 Directors must not communicate price sensitive information to a person who may deal in securities of the Company. In addition, a director should not recommend or otherwise suggest to any person (including a spouse, relative, friend, trustee of a family trust or directors of a family company) the buying or selling of securities in the Company.

5.6 Directors must ensure that external advisers who may receive price sensitive information are bound by confidentiality agreements or other enforceable confidentiality obligations.

5.7 The above principles also apply to the following:

(1) trading in financial products issued or created over the Company's securities and associated products; and

(2) entering into transactions in associated products which operate to limit the economic risk of security holdings in the Company.

6. Notification of dealings in securities legal and other considerations

6.1 ASX Listing Rules 3.19A and 3.19B require the Company to notify dealing in securities by directors within 5 business days. Three appendixes are included in the Listing Rules for the purpose of this notification, being 3X Initial Director's Interest Notice, 3Y Change of Director's Interest Notice and 3Z Final Director's Interest Notice.

6.2 Section 205G of the Corporations Act 2001 requires a director of a listed company to notify ASX within 14 days of acquiring or disposing of a relevant interest in any securities of the Company. This is an obligation of the director, not the Company. There is no prescribed form for such notifications. ASIC have granted relief from the requirements of section 205G where notifications are made by the Company under Listing Rules 3.19A and 3.19B.

7. Policy notification of dealing in securities

7.1 Directors must notify the Company secretary immediately on acquiring or disposing of a relevant interest in any securities in the Company.

7.2 Directors are required to enter into an agreement with the Company under which they are obliged to notify changes in interests in shares and other relevant matters.

8. Explanation of terms

8.1 For the purposes of this Policy:

(1) deal in securities means buy or sell shares, options or other securities in the Company, or enter into transactions in relation to shares, options or other securities in the Company. It includes procuring another person to do any of these things; and

(2) price sensitive information has the meaning given in paragraph 4.1.

8.2 For the purposes of paragraph 5.1, directors “dealing” includes associates of directors dealing in securities, and it is incumbent on each director to ensure that an associate does not deal in circumstances where the dealing could be attributed to the director concerned.

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Board Charter - 23 April 2004

Contents

1. Introduction
2. Definitions
3. Responsibilities of the Board
4. Composition of the Board
5. Appointment of Directors
6. Allocation of responsibilities
7. Committees
8. Policies

1. Introduction

This Board Charter sets out the functions and responsibilities of the Board and management of the Company.

2. Definitions

(1) Board means the board of directors of the Company;

(2) CEO means the Chief Executive Officer;

(3) CFO means the Chief Financial Officer;

(4) Chairman means the chairman of the Board; and

(5) Company means Genepharm Australasia Ltd ACN 107 340 367.

3. Responsibilities of the Board

The Board is responsible for, and has the authority to determine, all matters relating to the strategic direction, policies, practices, establishing goals for management and the operation of the Company. Without intending to limit this general role of the Board, the specific functions and responsibilities of the Board include:

(1) oversight of the Company, including its control and accountability systems;

(2) appointing and removing the CEO (or equivalent), including approving remuneration of the CEO and remuneration policy and succession plans for the CEO;

(3) ratifying the appointment and, where appropriate, the removal of the CFO (or equivalent) and the Company Secretary;

(4) input into the development of corporate strategy and performance objectives for the Company;

(5) reviewing and ratifying systems of risk management and internal compliance and control, codes of conduct and legal compliance;

(6) monitoring senior management's performance and implementation of strategy, and ensuring appropriate resources are available;

(7) approving and monitoring the progress of major capital expenditure, capital management and acquisitions and divestitures; and

(8) approving and monitoring financial and other reporting.

4. Composition of the Board

4.1 Size

The Board shall comprise 5 directors or the number of directors as set out in the Company's Constitution. This number may be increased where it is felt that additional expertise is required in specific areas, or when an outstanding candidate is identified.

4.2 Directors

(1) The majority of directors of the Company shall be non-executive directors.

(2) It is the intention of the Board that a majority of directors of the Company should be independent, non-executive directors in order to comply with corporate governance best practices, as appropriate given the maturity and performance of the Company.

(3) The Chairman shall be an independent, non-executive director. This does not prevent another director, in the absence of the Chairman, assuming the role of Chairman under clause 6.1(6)(a).

(4) An independent director is a non-executive who is not a member of management and who:

(a) is not a substantial shareholder of the Company or an officer of, or otherwise associated directly with a substantial shareholder of the Company (as defined in section 9 of the Corporations Act);

(b) has not, within the last 3 years, been employed in an executive capacity by the Company or another group member, or been a director after ceasing to hold any such employment;

(c) has not, within the last 3 years, been a principal of a material professional adviser or a material consultant to the Company or another group member, or an employee materially associated with the service provided;

(d) is not a material supplier or customer of the Company or other group member, or an officer of or otherwise associated, directly or indirectly, with a material supplier or customer;

(e) has no material contractual relationship with the Company or another group member other than as a director of the Company;

(f) has not served on the board for a period which could, or could reasonably be perceived to, materially interfere with the director's ability to act in the best interests of the Company; and

(g) is free from any interest and any business or other relationship which could, or could reasonably be perceived to, materially interfere with the director's ability to act in the best interests of the Company.

4.3 Expertise

(1) The Board shall ensure that, collectively, it has the appropriate range of expertise to properly fulfil its responsibilities, including, but not limited to:

(a) accounting;

(b) finance;

(d) the pharmaceutical industry;

(e) legal skills; and

(f) CEO-level experience.

(2) The Board shall review the range of expertise of its members on a regular basis and ensure that it has operational and technical expertise relevant to the operation of the Company.

5. Appointment of Directors

5.1 Directors are appointed in accordance with the terms of the Company's Constitution.

5.2 Subject to the number of directors allowed under the Company's Constitution, a director may be appointed by an ordinary resolution of the Company in general meeting. In the situation of a vacancy occurring between such election, the Board will appoint a replacement director. Such director will only hold office until the next Annual General Meeting of the Company.

5.3 The terms and conditions of the appointment and retirement of members of the Board will be set out in a letter of appointment, which shall include the following matters:

(1) the term of the appointment, subject to member approval;

(2) time commitments envisaged;

(3) the powers and duties of directors;

(4) any special duties or arrangements attaching to the position;

(5) circumstances in which an office of director becomes vacant;

(6) expectations regarding involvement with committee work;

(7) remuneration and expenses;

(8) superannuation arrangements;

(9) the requirement to disclose directors' interests and any matters which affect the director's independence;

(10) fellow directors;

(11) trading policy governing dealings in securities (including any share qualifications) and related financial instruments by directors, including notification requirements;

(12) induction, training and continuous education arrangements;

(13) access to independent professional advice;

(14) indemnity and insurance arrangements;

(15) confidentiality and rights of access to corporate information; and

(16) includes a copy of the Company's Constitution.

6. Allocation of responsibilities

6.1 Chairman

(1) The Board elects the Chairman in accordance with the Constitution.

(2) The Chairman will be selected on the basis of the person's achievements and record as a leader.

(3) The roles of the Chairman and the CEO must not be exercised by the same individual.

(4) The position of Chairman will be reviewed by the Board at the first Board meeting following an annual general meeting. The Chairman authorises the expenses of all the other directors and the CEO.

(5) The Chairman is responsible for leadership of the Board, for the efficient organisation and conduct of the Board's function, and for the briefing of all directors in relation to issues arising at Board meetings.

(6) The Chairman's specific duties are to:

(a) chair Board meetings. If the Chairman is not present within 15 minutes after the time appointed for the holding of that meeting, a director chosen by a majority of directors present shall assume this role;

(b) establish the agenda for Board meetings in consultation with the CEO;

(d) be the spokesperson for the Company at the Annual General Meeting and in the reporting of performance and profit figures; the CEO or the CEO's nominee will undertake all other public relations activities;

(e) be the major point of contact between the Board and the CEO;

(f) be kept fully informed of current events by the CEO on all matters which may be of interest to directors;

(g) regularly review with the CEO and such other senior officers as the CEO recommends, progress on important initiatives and significant issues facing the Company;

(h) provide mentoring for the CEO;

(i) chair the CEO evaluation process through the Remuneration Committee;

(j) commence the annual process of Board and director evaluation; and

(k) in accordance with the Constitution, have a casting vote.

(7) The Chairman is not entitled to vote or participate in the deliberations on any matter in which he or she has a personal interest, unless there is compliance with the conflict of interest provisions under the Constitution of the Company.

(8) The Chairman may be removed from office in accordance with the Company's Constitution.

6.2 Individual directors

In accordance with statutory requirements and in keeping with developments at common law, directors have the following responsibilities:

(1) exercise their powers and discharge their duties in good faith and in the best interests of the Company;

(2) use their powers of office for a proper purpose and not for personal advantage or for the benefit of another party;

(3) use due care and diligence;

(4) make a reasonable effort to become and remain familiar with the affairs of the Company;

(5) attend all Board meetings and Board functions unless there are valid reasons for non-attendance; and

(6) commit the necessary time and energy to Board matters to ensure that they are contributing their best endeavours in the performance of their duties for the benefit of the Company, without placing undue reliance on other directors to fulfil these duties.

6.3 The CEO

(1) The CEO is appointed by the Board.

(2) The CEO is responsible for the ongoing management of the Company in accordance with the strategy, policies and programs approved by the Board.

(3) The CEO's responsibilities include:

(a) developing with the Board, a consensus for the Company's vision and direction;

(b) constructing, with the Company's management team, programs to implement this vision;

(d) appointing the senior management team;

(e) endorsing the terms and conditions of appointment of all other staff members;

(f) providing strong leadership to, and effective management of, the Company in order to:

(i) encourage co-operation and teamwork;

(ii) build and maintain staff morale at a high level; and

(iii) build and maintain a strong sense of staff identity with, and a sense of allegiance to, the Company;

(g) ensuring a safe workplace for all personnel;

(h) ensuring a culture of compliance generally, and specifically in relation to environmental matters;

(i) carrying out the day-to-day management of the Company;

(j) forming other committees and working parties from time to time to assist in the orderly conduct and operation of the Company;

(k) keeping the Board informed, at an appropriate level, of all the activities of the Company; and

(l) ensuring that all personnel act with the highest degree of ethics and probity.

(4) The CEO is formally delegated by the Board to authorise all expenditures as approved in the budget, subject to:

(a) all CEO remuneration, outside of normal monthly remuneration, must be authorised by the Chairman;

(b) all business related expenses paid to the CEO must be authorised or ratified by the Chairman;

(c) while the Remuneration Committee must approve the terms and conditions of employees reporting to the CEO, the appointment of individuals to specific management roles is the responsibility of the CEO.

6.4 Company Secretary

(1) The Company Secretary is generally responsible for carrying out the administrative and legislative requirements of the Board. The Company Secretary holds primary responsibility for ensuring that the Board processes and procedures run efficiently and effectively.

(2) The Company Secretary is appointed in accordance with the Company's Constitution.

(3) The specific tasks of the Company Secretary include:

(a) overseeing the Company's compliance program and ensuring all company legislative obligations are met;

(b) ensuring that the agenda and briefing materials for board meetings are prepared and forwarded to directors in a timely and effective manner;

(d) preparing for and attending all general meetings of the Company and ensuring that the correct procedures are followed;

(e) recording, maintaining and distributing the minutes of all annual and extraordinary general meetings of the Company;

(f) meeting statutory reporting requirements in accordance with relevant legislation; and

(g) any other services the CEO or Chairman may reasonably require.

7. Committees

7.1 To assist with the execution of its responsibilities, the Board has the authority to establish and determine the powers and functions of the committees of the Board, including the Audit and Risk Committee and the Remuneration Committee. Each board committee is to document a charter, approved by the Board, setting out its responsibilities.

7.2 Remuneration Committee

(1) The role and responsibilities, composition, structure and membership requirements of the Remuneration Committee are set out in detail in a Remuneration Committee Charter approved by the Board.

(2) The Remuneration Committee consists of a minimum of two members being non-executive directors.

(3) The responsibilities of the Remuneration Committee include:

(a) executive remuneration and incentive policies;

(b) the remuneration packages of senior management;

(d) incentive schemes;

(e) superannuation arrangements; and

(f) the remuneration framework for directors.

7.3 Audit and Risk Committee

(1) The role and responsibilities, composition, structure and membership requirements of the Audit and Risk Committee are documented in a separate Audit and Risk Committee Charter.

(2) The Audit and Risk Committee consists of:

(a) only non-executive directors;

(b) an independent chairman, who is not the Chairman of the Board; and

(3) The Audit and Risk Committee must review the integrity of the Company's financial reporting and oversee the independence of the external auditors.

7.4 Code of conduct for directors and officers

(1) To promote ethical and responsible decision-making, the Board must approve a Code of Conduct for Directors and Officers (the CEO (or equivalent), the CFO (or equivalent) and any other key executives) as to the practices necessary to maintain confidence in the Company's integrity and the responsibility and accountability of individuals for reporting and investigating reports of unethical practices.

(2) Directors and the senior management team must comply with the Code of Conduct and demonstrate commitment to the Code and consistency in its execution. Adherence to the Code of Conduct must be periodically evaluated and intermediate action taken where necessary.

8. Policies

The Board (or appropriate board committee) is responsible for establishing policies relating to:

8.1 Share Trading

(1) The Company's Directors' Security Trading Policy shall document the Company's policy relevant to trading in company securities by directors and senior executives, respectively.

(2) The Policy must clearly identify those individuals who are restricted from trading, the relevant laws relating to trading, and include a coherent strategy for trading.

8.2 Disclosure

(1) The Company's Disclosure Policy is designed to ensure compliance with ASX Listing Rule disclosure requirements and to ensure accountability at a senior management level for that compliance.

(2) It shall include vetting and authorisation processes designed to ensure that company accounts:

(a) are made in a timely manner;

(b) are factual;

(d) are expressed in a clear and objective manner that allows the input of the information when making investment decisions.