The Gatherer Vol 11

Volume 11

CHEERS! To a new wine export label directory for Australian wine producers HOMEGROWN WORLD-CLASS INNOVATION SUCCESS We explore Dimerix’s commercialisation journey Ssh... There’s something you should know about secret use

EDITORIAL TEAM REBECCA HEMBLING Marketing & Business Development Manager rebecca.hembling@wrays.com.au HELEN EVANS Marketing & Communications Coordinator helen.evans@wrays.com.au

CEO MESSAGE W elcome to volume 11 of The Gatherer, Wrays’ flagship publication, talking all things intellectual property.

LOUISA TAYLOR-BOND Graphic Designer, Reflect Design louisa@reflectdesign.com.au CONTRIBUTORS RICHARD BADDELEY Principal richard.baddeley@wrays.com.au PETER CAPORN Principal peter.caporn@wrays.com.au JUDITH MILLER Commercial National Practice Leader judith.miller@wrays.com.au JESSICA MURPHY Trade Marks Attorney jessica.murphy@wrays.com.au ROBERT PIERCE CEO robert.pierce@wrays.com.au TODD SHAND Principal todd.shand@wrays.com.au MARIE WONG Principal marie.wong@wrays.com.au Guest Cont r ibutors MATT CALLAHAN Life Sciences Executive at Botanix DR KATHERINE ISCOE Director of the Dr Katherine Brand TYSON KEED Senior Associate tyson.keed@wrays.com.au

We also talk to Perth-raised biotechnology executive Matt Callahan about his journey in the life sciences sector. In recent years Matt has achieved notable success in the USA where he is now based. His story is a great example of how WA can be a fantastic base and provides strong foundations for those with international aspirations. Further afield, hydrogen has been a talking point across in many arenas lately. The need for cleaner fuels, which are also reliable, is clear. Wrays’ Principal Richard Baddeley discusses the current state of play for hydrogen in the transportation industry as our country’s first hydrogen refueling station opened earlier this year. When, realistically, shall we expect to see this as the norm?

The world of intellectual property sparks much excitement, and provides an ever-changing landscape - one which I am grateful to be a part of. As always, we hope this publication echo’s these sentiments and inspires your own personal and business growth. Enjoy the read!

CONTENTS 3

At Wrays, we are incredibly proud of the rich culture of innovation our hometown of Perth continues to cultivate. In this edition, we are excited to pay tribute to some of the most recent stories of success to come out of Western Australia. The commercial achievement experienced by our friends and clients at Dimerix is not only impressive, but also life changing on a global scale. We hear from the team of experts who’s collaborative hard work has the potential to benefit millions of patients around the world.

Message from our CEO

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Ssh… There’s something you should know about secret use

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Cheers! To a new wine export label directory for Australian wine producers

ROBERT PIERCE CEO T +61 8 9216 5115 robert.pierce@wrays.com.au

10 In the spotlight with Tyson Keed 12 Innovation patents’ long goodbye in sight 14 Matt Callahan - Life Sciences Executive 18 Hydrogen for transportation in Australia – The current state of play 20 Influencers and the importance of disclosure 22 Becoming a magnetic employer & creating a sticky culture

26 PIONEER: Interview with Eva Chye 29 Congratulations Emma Steeper 30 Homegrown world-class innovation success 32 Maintaining trade mark rights in China 34 Industry Insider 35 What’s On

Wrays is a proud supporter of WA Innovator of the Year.

Creating a culture of Innovation and entrepreneurship in Western Australia

Applications close 10 May 2021.

2 | The Gatherer

Ssh… There’s something you should know about secret use

T he main requirement for patent grant is that the patented invention must be novel (or new). This means that at the time of filing the patent application, the invention must not have been previously published There is, however, another requirement that is often overlooked by patentees and that is that the invention cannot have been secretly used for commercial purposes prior to the filing of a patent application. Secret use is a ground for patent revocation and failure to take this into consideration can be fatal to patent rights. or publicly disclosed by anyone, including the patentees themselves.

– any use of the invention by or on behalf of the Commonwealth, a State, or a Territory – any use of the invention by the

At the most fundamental level, a patent is a deal made between an inventor and the government in which the inventor is granted a monopoly to an invention for a limited term. This provides the inventor with a period of time in which they can exclusively benefit from exploiting the invention. In exchange, the inventor must fully disclose the details of the invention in the patent specification. The rationale behind this deal is that it offers an incentive for inventors to share their knowledge, thereby driving innovation. The secret use provisions have been developed to stop inventors in effect extending the term of the monopoly granted to them by reaping commercial benefit from the invention before filing a patent application. For example, an inventor of a new process for extracting gold is unable to secretly use that process themselves for commercial benefit and then file a patent application at a later date. Except ions to secret use It is important to note that there are exceptions to secret use. Section 9 of the Patents Act sets out certain activities that are not to be taken to be secret use. These include: – any use of the invention by the

patentee for any purpose, if a complete application is made for the invention within the prescribed period.

Court guidance on secret use The courts have considered numerous allegations of secret use and the outcomes provide some useful guidance on what transactions are considered ‘use’ and how to define ‘use for the purposes of trial and experiment’. The leading case in this area is Azuko Pty Ltd v Old Digger Pty Ltd [2001] FCA 10749, in which the patentee manufactured a number of articles, in this case drill hammers, before a patent application had been filed. The patentee had tested a prototype of his invention at a mining site. Following the test, the owner of the mining site gave the patentee an unsolicited order for five or six hammers in the month before the priority date. This order was not formally accepted by the patentee. By the priority date, the patentee had made15 to 20 hammers with some being made after the order had been received. On appeal to the Full Federal Court, it was held that there had been no commercial use of the invention before the priority date. Strong emphasis was placed on the fact that the actual acceptance of the offer was made after the priority date and so all steps required for the sale to be completed had not taken place. It was also found that the making and stockpiling of a patented invention before the priority date did not constitute secret use.

patentee for the purpose of reasonable trial or experiment only

– any use of the invention

by the patentee, being use occurring solely in the course of a confidential disclosure of the invention by the patentee – any other use of the invention

by the patentee for any purpose other than the purpose of trade or commerce

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“ The secret use provisions have been developed to stop inventors in effect extending the term of the monopoly granted to them by reaping commercial benefit from the invention before filing a patent application. ” However, it must be noted that this case involved the manufacture of a relatively small number of articles and a degree of leniency was shown. This might not have been the case if a commercial scale number of articles had been manufactured.

More recently, the question of secret use was considered in SNF (Australia) Pty Limited v BASF Australia Ltd [2019] FCA 425. In this case, SNF sought to revoke two patents on the basis that the previous owner of the patent applications, Ciba Specialty Chemicals Water Treatments Limited (Ciba), had secretly used the claimed inventions in the field prior to filing any patent application. It was also contended that Ciba sold 29 tonnes of flocculent (for a value of $93,915) for use in the claimed invention before the priority date and received income from the sale or license of equipment (for a value of at least $50,000) for use in the claimed invention before the priority date. SNF argued that these examples of use extended beyond “reasonable trial and experiment” and were therefore secret use. BASF contended that the use was for reasonable trial and experiment, relying on the fact that Ciba were always involved in the trials and the results of the trials were discussed in regular meetings. It was also contended that the nature of the invention meant that testing in a laboratory alone would not be sufficient and real world testing was required. In deciding the case, the judge noted that the relevant enquiry is whether the true purpose of the use was reasonable trial or experiment. Whilst it was noted that Ciba did receive remuneration for the sale of flocculant and equipment used in the process, it was shown that the costs of undertaking the trials exceeded this amount. Ciba were therefore found not to have reaped a commercial benefit from the trials. Taking all considerations and facts into account, the use by Ciba was held to be for reasonable trial and experiment and not to be secret use for the purposes of invalidating a patent.

Conclusions Confidential use of a patented invention for commercial benefit before the filing date of a patent can invalidate a patent. There are a number of circumstances in which this use may be excused, including use for the purposes of trial and experimentation. Whilst the distinction between commercial use and use for the purposes of trial and experimentation might appear obvious, elements of each are often intertwined. If the true purpose of the use is found to be for trial or experimentation, the fact that there may be some commercial benefit to the patentee will not constitute invalidating prior use. It is also worth noting that under the current patent law, a 12 month grace period exists for secret use. Any secret commercial use of a patented invention can be disregarded if a complete patent application is filed within 12 months of this use. This may require a complete application to be filed earlier than normal. We recommend seeking legal advice where you are considering undertaking, or you have undertaken, trials of a proposed invention prior to filing any patent applications.

In Innovative Agriculture Products Pty Ltd v Cranshaw (1996) 35 IPR 643, it was found that obtaining capital investment to enable a prototype to be constructed and agreeing to share profits was not secret use. In Bradken Resources Pty Ltd v Lynx Engineering Consultants Pty Ltd [2012] FCA 944, the patentee entered into a contract with a third party for trial and evaluation of three prototype wagons prior to the priority date of a patent. If the trials were deemed successful by the third party, they would then pay for the prototypes. Ultimately, the use was held to be for the purposes of reasonable trial and experiment. Despite any possible sales, it was established that the primary intention of the testing was to improve the product. It was also noted that there was no guarantee of income from the trial and so the financial burden was therefore born by the patentee.

TYSON KEED Senior Associate Chemicals Group

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A s part of the Australian government’s $50 million Export and Regional Wine Support Package, a new wine export label directory designed to help Australian producers protect their intellectual property rights is expected to be launched this month. The Directory will help to better protect Australian wine producers against copycat exporters and counterfeiters, and bolster consumer confidence in the reputation and integrity of Australian wines.

Importantly, however, it remains paramount for brand owners to seek to protect their labels through trade mark registration, both in Australia and in overseas markets to which they export, as Wine Australia’s remit does not extend to private trade mark enforcement. Protection will still need to be sought via securing relevant trade mark registrations, and taking advantage of local customs notification procedures at the borders where available. That said, Wine Australia has indicated in the FAQs on its website that where it is satisfied that an exporter is engaged in conduct such as copycat activity, it may consider whether to cancel or suspend an exporter’s licence. The Directory, in combination with ongoing protection and enforcement provided by a robust and well- considered trade mark strategy, can only be a good thing for the ongoing success and integrity of Australian wines and those of us who enjoy drinking them – cheers to that!

Whilst regulations implementing the detail of the Directory are yet to be finalised, legislation establishing the Directory was passed by Parliament at the end of sittings last year, namely the Wine Australian Amendment (Label Directory) Act 2020. The Directory, to be administered by Wine Australia, will require exporters of wines from Australia to submit images of the front and back labels of their wines for export as part of the process for gaining export approval. The aim of the publicly available Directory is to allow anyone to upload an image of any wine label they find and compare it to a list of genuine exported Australian labels, thus providing greater confidence to consumers, retailers and distributors of Australian wine products as to the authenticity of their wines. The Directory will also allow brand owners to search and monitor for new labels containing marks (eg, images, words or brand names) similar to their own, in order to identify potential counterfeit or infringing products, both intended for export and (potentially) in parallel under a similar brand within Australia.

“

CHEERS! TO A NEW WINE EXPORT LABEL DIRECTORY FOR AUSTRALIAN WINE PRODUCERS

The Directory will help to better protect Australian wine producers against copycat exporters and counterfeiters...

”

MARIE WONG Principal Trade Marks Group

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“ Tyson, before joining Wrays in 2010 you first studied nanotechnology. Did you do that with the intention of working in intellectual property? Not at all, in fact, I don’t think I knew what a patent attorney was when I was studying. I have always been really interested in science and this led to me originally pursuing a degree in a scientific field. I chose nanotechnology because it was a relatively new field that combined a lot of different science disciplines. However, towards the end of my degree, I was really struggling to see myself working in a research environment and I began to explore other options. It was during this time that I was introduced to a patent attorney and I completed some work experience here at Wrays. I was instantly fascinated by the mixture of science and innovation that went into solving real-world problems and the way in which all that work could be protected by patents. I have been at Wrays ever since. What type of clients do you typically work with, and what does innovation look like to them? My clients are primarily from the mining industry, particularly mineral processing technologies. The mining industry is typically thought of as relatively slow-moving, but my experience as a patent attorney has shown me that this could not be further from the truth. My clients in this space are constantly looking for ways in which to improve their

It is very rewarding being able to assist my cl ients with protecting their new technologies and seeing how they can use this protection to commercial ise the technology. ”

Personally, I find the society to be a fantastic resource for anyone who engages in R&D activities and is looking for assistance in commercialising their technologies. The members are all enthusiastic about innovation and are always willing to provide advice to those who are in the early stages of development. What does your current role with LESANZ entail, and what has it taught you? I am the chair of the Western Australian LESANZ committee. The role of the committee is to organise and run local events. The biggest challenge faced by the committee is to deliver engaging events that have topics that apply broadly across multiple industries. The role has taught me the importance of surrounding yourself with talented people with a diverse range of skills. It has also shown me the benefit from partnering with other businesses/organisations to achieve success. And finally, when you’re not absorbed in the world of IP, how do

operations, whilst also reacting to a multitude of external pressures. Lately, the industry has been led by the increased demand for battery materials and finding solutions for extracting such materials from sources that have previously been considered too difficult to treat. Can you share with us a highlight you’ve enjoyed during your time at Wrays? It is very rewarding being able to assist my clients with protecting their new technologies and seeing how they can use this protection to commercialise the technology. A definite highlight was a client of mine being able to utilise their patented technology to enter into a joint venture with a multi-national company to commercialise their lithium-ion battery recycling process. Tyson, you are the current Chairperson of the WA Regional Committee for the Licencing Executives Society of Australia and New Zealand (LESANZ). What is the purpose of the society? LESANZ is an organisation that aims to create a community that supports all aspects of innovation and commercialisation. The membership comprises mainly professionals from a range of industries who are involved in this space. The primary focus of the organisation is to provide education sessions and networking opportunities to exchange ideas and encourage innovation.

you keep yourself busy? Most of my spare time at the moment is taken up with

IN THE SPOTLIGHT WI TH TYSON KEED

renovations to my house. I am really enjoying the challenge it presents and the new skills I am learning along the way. If you’d like to find out more about LESANZ, visit lesanz.org.au.

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Creat ing a patent thicket Any number of divisional innovation patent applications can be filed from a pending Australian standard application or pending international (PCT) patent application, making this a relatively effective way of quickly establishing a ‘patent thicket’ that makes it difficult for a competitor to map a way through without the potential for infringement. Hot t ip It makes sense to consider whether now is the time to take advantage of Australia’s innovation patent system. Even though the innovation patent is saying goodbye, it offers significant opportunities for current and potential patent applicants in Australia to improve and solidify their intellectual property position.

Convent ion appl icat ion An innovation patent application can be filed claiming association/priority with/from an Australian provisional application or an overseas patent application to realise the various benefits of early grant, ability to target claims and the ability to retain the opportunity of obtaining protection for the longer term through a standard application. Negot iat ion/l i t igat ion tool Applicants with pending Australian standard applications or pending international (PCT) patent applications that become aware of infringements but are facing the prospect of possibly several years of prosecution before grant can consider filing a divisional innovation patent application can take account of the infringement without impacting the potential scope of the standard patent application from which it claims divisional status. The lower hurdle of the ‘innovative step’ compared to the inventive step requirement of standard patents is useful in these circumstances as innovation patents are arguably relatively easy to obtain and harder to revoke. innovation patent application. The claims of such a divisional

Strategies you might employ With the approaching beginning of the innovation patent’s sunset, existing patent applicants and those contemplating protection should carefully consider whether they should be filing one or more innovation patent applications. In considering these strategies you should note that the maximum term of an innovation patent is 8 years from the patent date, which if the innovation patent is claiming divisional status is the filing date of the ultimate parent application. It should also be noted that prior to asserting an innovation patent it is necessary to seek ‘certification’ of the innovation patent. This is a typical, although relatively quick, examination process. However, the obviousness test is replaced with the less onerous ‘innovative step’ requirement. Quick grant Innovation patents are granted within 4 to 6 weeks of filing, often sooner. If a quick grant is expected to be a useful public relations exercise, or might improve investor relations, then an innovation patent may be appropriate. Divisional appl icat ion An innovation patent application can be filed as a divisional application of an Australian standard application, or a pending international (PCT) patent application. This is a good mechanism by which a quick grant can be obtained, with all the associated signals that sends to interested third parties, whilst the applicant retains the prospects of also obtaining a granted standard patent in due course.

INNOVATION PATENTS’ LONG GOODBYE IN SIGHT

PETER CAPORN Principal Chemicals Group Head

U nlike Raymond Chandler’s 1953 novel “The Long Goodbye”, later adapted as a 1973 film starring Elliot Gould, the long goodbye from Australia’s innovation patent won’t be winning any literary awards.

If the end of the innovation patent seems like it has been coming for a long time, that’s because it has. The Australian Government first directed that the now defunct Advisory Council on Intellectual Property (ACIP) review the innovation patent system in 2011. A number of reviews and reports have issued since, with the fate of the innovation patent effectively being sealed mid-2017, although several rounds of lobbying by interest groups has seen the innovation patent limp to this point.

Now is the t ime Now is very definitely the time to consider whether an innovation patent might be a useful addition to your suite of intellectual property protection. As of 25 August 2021 it will not be possible to file an innovation patent that doesn’t have an effective filing date of that date or earlier. That is, after this date the only innovation patent applications that can be filed will be those that are either converted standard applications or are divisional applications of standard or PCT applications. Whatever the case, all innovation patents will have expired by 26 August 2029.

KEY DATES

wrays . com.au | 13 26 August 2029 All innovation patents will have expired by this date. 25 August 2021 The last date you can file any innovation patent application that isn’t claiming an earlier filing date.

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Matt is an experienced Perth-raised biotechnology executive currently based in Philadelphia, USA. He has been the founding CEO or Executive Director of a number of pharmaceutical and health tech companies including iCeutica Inc, Botanix Pharmaceuticals, Churchill Pharma Inc, Dimerix Biosciences, Emyria, Respirion Pharmaceuticals and Orthocell. He has led the development of four products that have received FDA approval and has more than 25 years legal, IP and investment management experience. Matt has worked as an investment director for two venture capital firms investing in life sciences, technology and other sectors, and was general manager of Australian listed technology and licensing company ipernica (now Nearmap ASX:NEA), where he was responsible for the licensing programs that generated more than $120M in revenue. Todd Shand, Wrays’ Principal has had the privilege of working with Matt on a variety of projects over many years. He sat down with Matt to find out more about his career and more importantly, how a Perth boy ends up in Pennsylvania! Todd: Can you tell us about your company Botanix and the work you’re doing with CBD at the moment? Matt: Botanix was founded in 2016 as a dermatology company, focusing on the novel use of cannabinoids. Cannabinoids are chemicals that were originally found in the cannabis plant. There are more than 100 of them that potentially have some therapeutic use. We found some literature that suggested that CBD, (which is the second most common chemical after THC), could be useful in indications like acne and other skin diseases. Without the availability of animal models, (as there’s no other animal that gets acne other than humans), we

moved pretty quickly to clinical trials. Australia was a great place to do that, because of the regulatory system and availability of Phase 1 units. Botanix now has a technology that delivers drugs into the skin efficiently and a number of different CBD-based programs in acne, rosacea, and some antibacterial/anti-microbial applications. We’ve been able to demonstrate that CBD is really safe when applied to the skin, kills bacteria effectively and reduces inflammation. All those things are really important for different dermatological diseases. Todd: What prompted the move to the U.S.? Matt: I moved to the U.S. because we sold a company called iCeutica which we started in Perth with some co founders James Williams and Liddy McCall, using some University of Western Australia technology to make drugs smaller and help them perform better. We sold that to a private equity firm based in Philadelphia in 2010. The original arrangement was I would go there for two years, establish the lab, hand over the reins and come back. Four years later I said to my wife “Well, what are we doing now? Are we staying?” We’ve been there for 11 years. Todd: Working and living in the U.S. are there any lessons you have learned with regard to getting FDA approval for your products? Matt: When I started in this industry, it was all about “How do you get a product clinically developed and then approved by the FDA?”. But the reality is, getting a product approved is an important step, but in the scheme of things, probably a minor step, because of the pressure that’s now on the insurance companies in the U.S. You can now only get reimbursement if you’ve got something that’s really novel, addresses a problem that needs to be solved, and does so in a way that saves the health system money. You can’t just be a slightly different, or a better version of whatever is out there. From an investment point of view, that makes it really interesting because no longer are you investing in things that will give you a 2X, 3X return. You need to be investing in things that you are going to smash out of the park because not all of them will work, and not all of them will get reimbursed to the level that you think that they need to, to make money.

MATT CALLAHAN Li fe Sc iences Execut i ve

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“ You can have a degree, but once you’ve got that intellectual specialisation, you’ve got to be prepared to make jumps, to make leaps and get other skills and experiences to become whatever you’re going to become. ”

Todd: What have you learnt along the way about developing career paths? Matt: I was talking to my son the other day, who is thinking about his career. I gave him the example of my own career where I’ve had eight different types of jobs, and how I got to where I am now. There’s no study chart that you can follow to end up doing what I’m doing. I was saying to him, “You can have a degree, but once you’ve got that intellectual specialisation, you’ve got to be prepared to make jumps, to make leaps and get other skills and experiences to become whatever you’re going to become.” I was a senior associate in a law firm, about to make partner, and I moved to a startup company. My parents just about had a heart attack, but I wouldn’t change it. I could be a partner of a national law firm today, but I probably wouldn’t be happy. You have to throw yourself in the deep end and see what happens, and if you do that enough times, you learn to swim fast. Todd: Can you tell us about your new home town? Matt: Philadelphia is one of the oldest cities in the US. It’s where the constitution was signed. It’s where Ben Franklin worked his magic. It’s where the Liberty Bell is. I can compare it to Melbourne versus Sydney, where New York is Sydney, and Melbourne is Philadelphia which in many ways, has a similar architecture and feel. It’s a great city to live in, the suburbs are very English with stone houses, creeks, big trees, deer and brooks. The city is placed beautifully between New York and Washington. It’s a central hub, and a lot of bankers and lawyers live in Philadelphia area and commute to New York and Washington as a result. It’s also very sports mad. We have Philadelphia Eagles football team (who won their first Super Bowl the same season the West Coast Eagles won their last), an improving baseball team and the 76ers basketball team that features Australian Ben Simmons.

Todd: What do you miss about Perth? Matt: The quality of lifestyle in Perth is unrivalled anywhere in the world. The beaches in New Jersey don’t hold a candle to what you can find in Western Australia, and the fact that you have warm weather and sunlight most of the year, means you can be very healthy and outdoorsy. That entrepreneurial spirit in Western Australia obviously is really important, and my family is all in Western Australia, so I miss them as well. Todd: Any final words of advice for our readers? Matt: I recommend everyone at some stage in their lives read The Man in the Arena, by Theodore Roosevelt. It is about the importance of the guy who’s got dust and blood on his face, he tries and he fails, and yet he keeps coming back. It’s really good. In Australia it is something we should embrace more of, giving people opportunities and picking them up and throwing them back into the fight, as opposed to just standing on the sideline and criticising or saying, “It can’t be done.”

Todd: That reminds me of a saying “Good judgement comes from experience. Experience comes from bad judgement.” Matt: That’s a really interesting comment. I think it’s something that Australia doesn’t do as well as the US. Experience is gathered by making mistakes and having another crack and doing it better the second time. I think the US entrepreneurial mentality is a lot more tolerant and respectful of mistakes. You get your stripes from being successful obviously, but you also get your stripes from having a go and not being successful and learning from that. It is important to have a lot of different experiences to make yourself good at anything because you need context. Todd: You sit across a number of companies. What do you look for in the people that you work with? Matt: It’s a mix. You need very good scientists who understand the mechanism of the drug or the disease and on the commercialisation side you need people who know “Where do I get off this train?”. One of my mentors uses the analogy of the train. Drug developments go from one end of the train track to the other end, but along the way, there’s lots of different stops and you have to understand what those stops are - the value inflection points. You can stay on the train to the next station, or you can get off the train for some value, and that value changes as edge towards the end point. Commercialisation has to have that understanding of what that the train track looks like in its entirety, but also how to make the value decisions. “How much money do I need to get to the next stage? What value do I get, if I get off at that particular point, or carry it to the next station on the track?”

Todd: Can Australian-based biotech companies looking for a U.S. presence, manage those opportunities from Perth? Matt: You can. There are good examples of that happening. You look at companies like OncoRes Medical, with Dr Kath Giles. Her advisory network is very strong in the U.S. She’s focused entirely on the reimbursement landscape for getting a product commercialised, separate from how she actually gets it approved by the FDA, and developing that infrastructure and those insights. But if you’re going to commercialise a product in the U.S, you need US-based experience of how to do that well. Australia remains a great place to develop early stages of drugs and conduct initial clinical studies, but for Phase 3, you need US patients in the study and there’s no getting around the fact that the biggest market is the US and so you have to do things the American way to get the American returns - that’s what investors are looking for. Todd: As a venture capitalist, what attributes do you look for in a company that may predict future success? Matt: To be honest, when I was a venture capitalist, I wasn’t a very good one, just because I had no operational experience and didn’t know what I didn’t know. Of course, in the pharmaceutical biotech world, it’s really US-centric and I knew honestly next to nothing about that. At the time, the things that I picked or got involved with probably weren’t the best decisions, but I guess over the last 15 years I’ve learnt something and understand better now what makes a good biotech pharma opportunity.

TODD SHAND Principal Life Sciences Group Head

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HYDROGEN FOR TRANSPORTATION IN AUSTRALIA THE CURRENT STATE OF PLAY

Such vehicles may be expensive but, in that case, leasing may offer an alternative to purchasing as Nikola’s plan for commercialising its FCEV trucks (with a potential 1900km range) demonstrates. From an Australian perspective, though a passenger vehicle manufacturing industry is uneconomic (and BEV alternatives exist), it appears that the same is not true of heavier vehicles. As Hydrogen Research, Development and Demonstration have observed, Australia is dependent on long-haul trucks and mining vehicles which carry large loads, travel significant distances and, in the case of mining, need to operate continuously with consequent requirement for large fuel capacity. Opportuni t ies for innovat ion and bui lding hydrogen IP A number of hydrogen research projects are currently underway in Australia, many of these directed to methods of hydrogen production through electrolysis, steam methane reforming and other novel techniques including membrane technology developed at the CSIRO. Innovation in the heavier transport sector may also offer fruitful ground for further research and development. If technology making the adoption of hydrogen as fuel for heavier vehicles easier were to emerge, the protection of related IP would offer the potential for development of overseas markets for that technology. A hydrogen-based heavy automotive sector would become feasible and that leaves aside potential marine fuel opportunities as well. Whilst there are a number of technical areas to explore, optimisation of hydrogen fuelling systems and fuel cell management for heavier vehicles with ‘back to base’ characteristics looks to be most fruitful. What next? Decarbonisation makes hydrogen the element of the moment and the fuel of the future. To overcome existing constraints, hydrogen adoption as a transport fuel should be focussed on heavier vehicles. Technological development to make this possible is open to Australian industry and could create a valuable IP portfolio to propel Australia’s hydrogen economy.i

In fuel cell electric vehicles (FCEVs), where hydrogen is used to produce electricity to drive the electric motor, hydrogen provides some advantages over lithium-ion batteries. The most significant benefit is hydrogen’s superior energy density, meaning that vehicle range is extended over the typical BEV on a weight basis (BEV: 400-600 km without refuelling; FCEV: 500-800 km without refuelling). This results in a less regular need for refuelling. However, hydrogen refuelling infrastructure is limited and drivers for FCEV adoption, especially in terms of subsidisation that industry is arguing for, are relatively light on. The best mode to supply hydrogen for the fuel cell is by pressurised storage (700 bar) in a tank. These tanks can be relatively heavy, making them less attractive for light vehicles. Not a fantasy Despite perceived issues, though, hydrogen and battery are getting closer to internal combustion engines in economic terms. The Australian National Hydrogen Roadmap predicted the following improvements in costs (defined as levelized cost of transport – LCOT) over the period 2018-2025:

Passenger vehicles

Buses

O n 26 March, Australia’s first public hydrogen refuelling station, operated by ActewAGL, opened in Canberra. This will allow fuel cell electric vehicles, as well as battery-operated electric vehicles, to easily operate around the Canberra region. This development urges a question on the current state of play in hydrogen-fuelled innovation to meet transportation needs. The decarbonisation incentive for hydrogen is well established but opportunities for innovation may be less clear. Let’s explore some technology and economics, and then look at potential areas where Australia may build IP in hydrogen transportation.

LCOT 2025 (A$)

LCOT 2018 (A$)

LCOT 2025 (A$)

LCOT 2018 (A$)

Battery electr ic vehicles (BEVs) and fuel cel l electr ic vehicles Battery electric vehicles, especially those with a hybrid powertrain, have been around a while now and are quietly establishing themselves. As the name suggests, a BEV is provided with a battery rack – typically powered by lithium- ion cells – which provides electricity to run an electric motor that allows the vehicle mobility. Despite the possibility to achieve zero emissions, there are challenges: – Charging. Batteries have to be recharged and charging infrastructure is still limited. Charging times can be quite long. – Weight. Batteries weigh, and this can limit the range of BEVs that are available. Lower weight vehicles may be compromised if they need to carry a heavy, and expensive, battery rack. – Range. People worry about the relatively low range of BEVs and whether they will have problems operating their vehicles. Hybrid powertrains reduce this worry but they still remain to some extent.

ICE

0.71 1.19

0.73 0.68 0.70

1.83 2.66 2.96

1.85 1.80 1.84

BEV

FCEV 1.43

Passenger FCEVs currently have a higher levelized cost of transport (LCOT) than ICEs and BEVs, but – on an LCOT basis – FCEVs could become competitive in passenger vehicles by 2025 though achieving this could depend on government support and availability of suitable vehicles and hydrogen fuelling infrastructure which remains constrained, even in a hydrogen focused economy like Japan. Heavier FCEV vehicles Heavier vehicles such as trucks and buses are a more favourable opportunity than passenger vehicles because battery operation is impractical and through economies of scale, achievable through higher hydrogen demand. The fact that buses and trucks typically need to return to a base makes hydrogen fuelling easier even with quite constrained hydrogen-fuelled infrastructure.

RICHARD BADDELEY Principal Engineering & Technology Group

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HOW DOES THE CODE DEFINE ADVERTISING?

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Any material which is published or broadcast using any medium or any activity which is undertaken by, or on behalf of an advertiser or marketer Over which the advertiser or marketer has a reasonable degree of control, and That draws the attention of the public in a manner calculated to promote or oppose directly or indirectly a product, service, person, organisation or line of conduct.

The Practice Note to section 2.7 provides useful guidance for influencers and brands Influencer and affiliate marketing often appears alongside organic/genuine user generated content and is often less obvious to the audience. Where an influencer or affiliate accepts payment of money or free products or services from a brand in exchange for them to promote that brand’s products or services, the relationship must be clear, obvious and upfront to the audience and expressed in a way that is easily understood (e.g. #ad, Advert, Advertising, Branded Content, Paid Partnership, Paid Promotion). Less clear labels such as #sp, Spon, gifted, Affiliate, Collab, thanks to… or merely mentioning the brand name may not be sufficient to clearly distinguish the post as advertising. These rules were tightened in February 2021 to ensure that advertising content was not disguised as news, independent market research, user-generated content, private blogs or independent reviews. What was the decision? In short, the panel considered that the advertisement did The panel considered that it had to examine two issues: – did the material constitute an “advertising or marketing communication” – if the answer to the first issue was “yes”, then was the advertising material clearly distinguishable as such. Did the mater ial const i tute an “advert ising or market ing communicat ion”? The Panel considered that the clear placement of the product in the advertisement and the use of the brand name runawaythelabel did amount to material which would draw the attention of the public in a manner designed to promote the brand. On the issue of whether the advertiser (i.e. Runaway The Label) had a reasonable degree of control, the advertiser did not respond. Nevertheless, the Panel proceeded on the presumption that the post was authorised by the advertiser, because Ms Heinrich was a well-known influencer who would be likely to post such material under a commercial arrangement. breach section 2.7 of the Code. What was the reasoning?

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Was the mater ial clear ly dist inguishable as advert ising?

INFLUENCERS AND THE IMPORTANCE OF DISCLOSURE

The Panel considered the Practice Note to section 2.7 and concluded that while some followers of the influencer may be able to recognise that the post was most likely advertising, there was nothing in the wording of the post and no hashtags which clearly demonstrated that it was advertising material. The Panel considered that tagging the brand on its own was not sufficient to clearly and obviously show that there was an arrangement between the brand and influencer. What are the key act ions to take? By inf luencers To clearly identify that a paid post is advertising: – merely mentioning or tagging the brand will not be sufficient – they must include a tag such as #sponsored, #ad, #advert, #advertising, #brandedcontent, #paidpartnership or #paidpromotion. By the brands To protect brand integrity, businesses should include a requirement in their agreements with influencers that they comply with the Code and specifically the requirement to ensure that each paid post is clearly identified as advertising by using clear language (such as #sponsored, #ad, #advert or #advertising).

A recent decision of the Ad Standards Community Panel (case number: 0055-21) has reinforced the need for influencers to clearly identify when a social media post is an advertisement.

What happened? An Instagram post by influencer Anna Heinrich included an image of her in a green dress, with the text: Turning my apartment into a Runway Then back to my PJs I go! Wearing: @runawaythelabel. What were the complaints? The thrust of the complaints was that there was no transparency in the post regarding the sponsorship by Runaway The Label. What’s the law? Section 2.7 of the Australian Association of National Advertisers Code of Ethics (Code) states that: Advertising shall be clearly distinguishable as such.

JUDITH MILLER Principal Commercial Group Head

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T he Wolf of Wall Street, a movie that portrays the real-life astronomic rise and downfall of stock-broker Jordan Belford, shows the incredible power of financial motivators. Indeed, the equation is clear and simple for Jordan’s money-hungry, oversized- suit wearing employees to understand: work your butt off, crush your KPIs and you get to live the high life. In short, the story promotes a ‘money talks, BS walks’ method to motivate the corporate masses. So when rising the ladder isn’t possible, kick in a few bucks to keep people loyal. When something needs to be done fast, dangle a bonus. Let’s face it: the symbolic meaning behind money is so powerful that it can instantly cut through language barriers (just think of the last time you were in a foreign country and needed help). Money provides protection, safety and (quite often), power. So, it seems simple enough, right? If you need to motivate your workers and keep them loyal, use money. But is that the best way for companies to show care for the people that stand behind them through politics and pandemics?

While this theory has its critics, data don’t lie: rich countries aren’t happier, which remains true whether you’re starting off poor or rich, developed or not. While the authors are quick to state that causation is far from clear, they have two predictions: issues may arise due to social comparison, and hedonistic adaptation. Put more clearly, people want to keep up with the Joneses and are never happy with what they have. And perhaps you’ve seen this paradox in action: the motivation of a raise or bonus wears off within weeks. Salary comparisons causing office drama and one-upmanship. Indeed, salary disparities, whether deserved or not, are hard to swallow for others. The result can manifest as inter-team conflict, struggles for power which show up as passive-aggressive digs or sly humour, and worst of all, water cooler gossip. Breaking bread Fear not, fixes are on the horizon. I’d like to use a recent experience within my own company that exemplifies the power of using a financial-free love language to promote team connection and work- related happiness. Six weeks ago, I performed an anonymous ‘wellbeing’ audit for our team members (part of a corporate team development program I run), which provided incredibly rich and useful data. While many of the questions were quantitative, the online questionnaire also included a chance for optional feedback.

When is enough, enough? Here’s the problem - The Wolf Jordan was making upwards of $250,000 USD per day, which equates to approx $520 USD per minute (yes, per MINUTE). Did he ever say “I think that’s enough. I feel satisfied and fulfilled, time to close shop!”? Of course not, he waited until he was knee-deep in federal investigations, pushing legal boundaries and ending up in jail. Putting aside the obvious moral, legal (and psychological) issues for a moment, this argument suggests that for many, no money will ever be enough money for soulful fulfilment. The happiness-income paradox Decades of research by Richard Easterlin, a professor of economics at the University of Southern California contributed to his development of a social-economic theory called the Easterlin Paradox. This theory wasn’t based on small fry data. Quite astonishingly, his group collected information over 34 years, spanning across five continents, with countries that ranged anywhere from developing to developed, socialist and capitalist. While several findings were born from this incredible data set, pertinent to this conversation is the relationship between gross domestic product per capita (GDP) and measures of happiness, including life satisfaction. Essentially it asked the question: as a country gets richer, do they get happier, too?

BECOMING A MAGNETIC EMPLOYER & CREATING

A STICKY CULTURE

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So here’s my challenge for you: pick someone who you rarely have time for. Perhaps it’s a colleague that always gets a ‘sorry this report is late’ email. Or a teammate that always gets the crappy jobs. Whomever it is, set aside five minutes to connect with them on something THEY care about that isn’t work- related. – Turn your phone on silent, and keep it out of sight. – Listen, ask questions and go into the experience with a sense of curiosity. – Don’t expect anything out of it. Yes, that’s it. At the end of the day, it’s not about having time. It’s about making time.

It was this feedback that catalysed the introduction of our weekly ‘Hunger Games’. Here’s how it works: – We create a list of our team members in alphabetical order. – Each Monday, the scheduled team member selects their choice of cuisine for take out, and the menu is circulated. – Each member chooses their meal and the order is placed to arrive each Wednesday at noon. – No matter what is happening that day, we convene as a group, without technology at our fingertips, to enjoy a meal and some seriously funny banter (while our office chihuahua mascots, Eszie and Eddie, pull out the puppy dog eyes and work the room). Scientists and researchers long classified interpersonal energy as ‘woo-woo’ and eye-roll worthy, yet this simple experience would make anyone a believer. Our office is now a place of electric energy. Most importantly, creativity, collaboration and production levels have flourished. Soul ful solut ions Perhaps food isn’t your thing. Or perhaps, a little virus has got in the way of in-person connection. As such, here are three ways for you to show your corporate colleagues that you care, while creating a magnetic culture: Ask, don’t presume Rather than jump on the money bandwagon, have a conversation to better understand what makes a person tick. For one of our team members, the thought of a brand new Xbox is the equivalent of winning the lottery. Another example, a company I know (and respect!) buys a wheelchair for a child in need when certain team goals are met. Authent ic care isn’t hard

Think outside the box During my Master’s degree, we held weekly “journal club” sessions, where one lab member would select a cool (albeit nerdy to some) scientific study in a slightly different area than ours. The purpose was simple: to get us thinking outside the box. Our team does something similar: lunch ‘n’ learn sessions on every subject imaginable. For many people, including myself, learning new things is worth its weight in gold and the ‘donation’ of time during work can be an extremely fulfilling, intrinsic motivator. Br inging i t home If you’re sceptical of the above suggestions, join the line. It’s hard to see how a group lunch or a ‘just because’ email is important for effective business growth. However, research (particularly notable are studies by John Kotter) demonstrates that investing in company culture can:

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Great things in business are never done by one person, they are done by a team of people.

– Increase revenue up to four times faster. – Increase stock prices 12 times faster. – Increase profits up to 750% faster.

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WHO IS DR KATHERINE?

S T E V E J O B S

Dr Katherine Iscoe is the Director of the Dr Katherine brand and Co-Founder and Director of Corporate Health & Wellness for Advanced Human Imaging Limited - an ASX-listed company with a multi-million-dollar market capitalisation. Dr Katherine personally understands how life’s ups and downs can create a conflicted mindset, preventing us from reaching our goals. And as a co-founder (and former CEO) of a fast-growing tech company, Katherine observed how individual mindsets can act as either an accelerator, or a handbrake, to team performance. It is for this reason that Katherine developed her science-based approach to team development, allowing individuals to ‘hack’ their mindset to bring out the best in themselves and each other.

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I recently had a bout of low blood pressure, one day being so bad I had to go home and rest. Out of the blue, I received an email from our CTO simply saying “I heard you weren’t feeling well, hope you feel better soon”. That was it. Eleven words that likely took all of 20 seconds to write and send. It was not required, and therefore far from expected, which made it all the more special. Summary: small things to you are often the most significant to someone else.

DR KATHERINE ISCOE Director of the Dr Katherine brand

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