Contingent consideration

12 Months Ended

Jun. 30, 2022

Note 16. Contingent c

onsideration


	2022 A$’000		2021 A$’000

Current Liabilities

Contingent consideration – EVT801		759		3,165

		759		3,165


Non-current Liabilities
Contingent consideration - paxalisib		1,168		1,015
Contingent consideration – EVT801		7,588		7,911

		8,756		8,927

		9,515		12,091

Reconciliations

Reconciliation of the balance at the beginning and end of the reporting period is set out below:


	Consolidated
	2022			2021
	$			$

Contingent consideration at start of period		12,091			1,845
EVT801 acquisition		—			11,076
Payment of paxalisib milestone		—			(3,400	)
Payment of EVT801 milestone		(2,364	)		—
Effect of exchange rates on contingent consideration		(364	)		—
Loss on revaluation of contingent consideration		152			2,570

		9,515			12,091

Contingent consideration - paxalisib

During the 2017 financial year, the consolidated entity acquired the rights to develop and commercialise paxalisib, as part of a business combination.

The acquisition contained four contingent milestone payments, the first two milestone payment settlements being Kazia shares, and the third and fourth milestone payment settlements either cash or Kazia shares at the discretion of Kazia. Milestones 1 and 4 have now been paid out, and Milestone 3 has lapsed. Milestone 2 comprises shares to the value of $1,250,000.

Each milest

one

payment is probability weighted for valuation purposes. The milestone payments are discounted to present value, using a discount rate of 15% per annum (15% - 2021). Kazia is also required to pay royalties to Genentech in relation to net sales. These payments are related to future financial performance, and are not considered as part of the consideration in relation to the Genentech agreement.

In April 2022 the paxalisib Phase II clinical study was successfully completed and a final clinical study report received.

Contingent consideration - EVT801

As set out in note 2, the acquisition of EVT801 has been accounted at cost as a separately acquired intangible asset with milestones where the payment is considered probable being booked as a current or

non-current

liability at year end, according to the estimated payment date. Milestones where the payment is not considered probable at year end have not been accounted for as a liability. The total amount of milestone payments not booked at year end amounts to €300,500,000 ($456,063,136).