REGISTERED COMPANY NUMBER.. OB820009 (England and Wales) REGISTERED CHARITY NUMBER: 1156666 REPORT OF THE TRUSTEES ANO UNAUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021 FOR PHELLX RESEARCH AND DEVELOPMENT Watts Gregory LLP Chartered Accountants Elf6d House Oak Traè Court Cardiff Gate Bu5inès5 Park CAROIFF County of Cardiff CF23 8RS PHELIX RESEARCH AND DEVELOPMENT CONTENTS OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021 Pag• Report ol th• Trustee5 Ind•p•ndent Examinerf$ Report Statèmènt of Financial Activltl¢s Balanc¥ Sheet Notss to the Flnan¢ial Statements 7 trj 10 PHELIX RESEARCH AND DEVELOPMENT REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2021 The trustees, who are also directors of the charity for the purpos8s of the CompBnles A¢1 2006. present their report with the finan¢ial slatemenls of the Charity for the year ended 31 December 2021. The truste95 have adopted the provisions of Accounting and Rep￿ting by Charities.. Statement of Recommended Practice 8ppIic8bte lo charities preparing the accounts in accordanee with the Financial Rèporbny Standard applicable in tho UK and Republic of IrÈ18nd {FRS 1021 {offective 1 January 20191. OBJECTIVES AND ACTIVITIES Objectlves and aims The charivs obpcts as stated in its Articles of Association are-. 'To protect and promote th8 health ol the public tn particular by research into th& nature cases, diagno&s. prevention, treatment and cure of chronic infection diseases, includino the develi>pm8nt of findings of resobrch into practical applications for the prevention, treatment and cure of chronic infectio%) disèas$s and in furtherance L>f that primary objective, to support information atKI rais8 public understanding of sueh malt915, and to support tha research on bacteriophages for bacterial inledions in a chronic phase and to devèlop Iherapeutic program5 based on bacteriophages.. Phelix Resèarch & Development {Phèllx R&D) is a medical researth charity. Th8 charity works hand in hand with Phelix Fran￿, registered in France as an 'Association d'lnlérél Général.. Its team is a strong co.partnership of healthcare professlonals Ipraclitiorws. immunolojists and unlversity researchers, amongst them Leicester Untversityl ènd voluntee¥s, working tOgeth8r to reach the charity's key objoctivgs. The overall aim 15 to develop ph8ge-b8sed diagnostic and troatmgnl ol Lyme disease. To-d8t&, we have developed a novel ph8gè-ba5ed diagnostic method targeting Lyme Borrelia S￿1￿5. This novel diagnostic rnethod showed higher sensitsvity compared lo the current dia9nosb¢ methods. With furth&r dèveloprn8nt. our phage-basèd method could have the power to distinguish behyeen active 8nd non-aclive Lyme infection and off8r a promise of earfy Lym8 (Ji89r￿Stics. In addition to our pioneer wotl( in Lyme dTr8gnostics, we hav& also d6velop8d our pipelines of m&thodolo9ies in isolation and identification of phages that specifically infect Lyme Borrelia slrains. artd w8 are c￿r￿ntIY activ&ly screening for phages. Once we identfy phages, we will test th9 efficacy of these phages In killtng Borrelia strain, aThJ develop them towards therapeutics. Activty update Currenuy, the charity is f￿￿$sed on supporting r&sè8r¢h yufrounding bacteriophage virusgs and their potential usès in ¢hronic infection. Could bact8riophages Pfovide aft alL8rnative lo anlibiotscs. providlng a solulK)n to the problem of increasing anlibiotic resistancg, one of the lar9est th￿Sts lo glob81 heallh? Bafore reaching this stag&. r8searc* 15 required in the development of new and mor& $8n5i¢4V9 tests for such thron1¢ infections. The genus of bacteria id8nlified as a target for ￿Se$r¢h being canied out by the Phelix tèam inibally is callèd 8orr&lia spp. Many of the speci*s within Ih¢s genus are commonly known lo be carried by ticks and I￿e and can cause Lymè disease, il spread lo humans. Simultaneously, work is bwng done to givè further in$ight into the pathology and physlology ol major neurodegèn8rative conditions, specifically neuroborreliosis, BLrtism spectrum disorder and Alzheimer's di58ase. This investigation is to piovide a firm basis fot Phelix's future resoareh into the relationship be￿an chronic inlèction and neurodegeneT8b"on. In the year 2021, th¥ charity and the Univèrsity of Leicester have been focuslng on improving the specificity and the sensitwity of the diagnostic lesl we designed. Our agreemoftt with Rgd Laboratori&s In Bélgium helped us to gain some retums from ourjoint patent in orrjer lo finance the research. The charity thd also som8 interesting work on improwng our Bartonella Sp. Test. In Ihe year 2021. the University of L•lc8st&r published its first article in a professional journal about OUT research. OBJECTIVES AND ACTIVITIES Publle benefit The trusteès can confiryn that they have complied with the duty in SeCt￿n 17 of the Charities Act 2011 to have due regard to public benefit guidance published by the Charities Commission. Slgnifieant activities that we undertook during the year that demonstrate publie b&n8fit are 3et out atr*)ve. Page 1 FOR YEAR ENDED 31 LECEAWi 21n1 FINANIJAL REVIEW Flnaneial P￿lI[0n During Ihe year. the chairty £95.193 and irKurf¢d exwdhurp of £95.918. gNing a n8t po8Jbon ot£725. tho yèar2021. thi5 due tott* suN)ortofthètru$lÈes. STRUCTURE. GOi+ERPUhfEAt4D MANAGEMENY Go¥Èming do¢urt*ftt The tharity i8 9ovemed by its Memorandum Ar￿deS ofA8sws*w Wld ￿￿stitU￿￿ a&Thpary ty guarante8. 88 defined ty th? compar￿e$AC# 2016. TTUSte&s are 8ppointed or reM0￿d or reth by r8sdubon of tru8lves ot tx)ard meetin9 or thé AML￿1 G8n8Tat Mee*"rtg. The Board ofTru5tees adminiskn the r￿nF￿ry. 7he Board meets q￿rtety. use ofièE trairung aNi th￿ a¥wlab* on the Ch&ity Cryntnissi¢xh ￿Eb￿te. cA)rrt[￿S arB in to provide roasonabJ8 aS￿nCe aganslfrdD￿ and 8fyDT. REFEREtICE A￿) ADMIMISTRATfvE tWAIL8 08821XJ09 {Englalld and ￿e$l ReglBtered Clwlty n￿rtbOr 1156PA6 R•glstered offic• 37 Lar￿ Stre CheSse8 LONDON SW10 OJL m{FAGcL￿¥et Dr L C Te￿i￿r&S Chartered Awuntatts Elfed H1X￿e, OakTree Cwrt Cardiff Gate Business Pa CARDIFF CF23 8RS 01 ¥rfl s¥JnBd bdwlfty.. Mf F A G C L(wJ¥Et INDEPENDENT EXAMINER'S REPORT TO THE TRUSTEES OF PHELIX RESEARCH AND DEVELOPMENT Independent examlnèls r&port to the trustees of Phelix Research and Developmènt Ilhe Company'l I report to the charity Irust&ès on my exarnination of Ihe accounts of Ihe Company for tha year ended 31 Oersmber 2021. Rèsponslblllti•s and basls of report As th8 charity's trustees of the Company land also lis dlrèctr)rs for the purposos of company law) you are responsible for the prepar&t(on of Ihè accounts in acLordance wth the requiremènts of the Companies Act 2006 Ilhe 2006 Acl'l. Having 5alisfied myself that the accounts of thè Cornpany are not required lo be audited under Part 16 01 the 2006 Act and are eligible for independent examinatioft, I report in rospe¢t of my exarnination of your charitys accounts as cairied out under Section 145 of the Charities Act 2011 I'tho 2011 Act'l. In carryifig out my examinaiion I have followed the Direth'ons given by the Charity Commissth under Sedion 145151 Ib) of the 2011 Act. Indeperhdenl examiner's statem•nt I have complgled my examination. I confim) that no matters hava come to my attention in connedion wth the examination giving me cause to b&llèvè'. accounwng records were not kept in rèspert ofthe Company as required by Section 386 ofthe 2006 Act: or the ac¢ounls do not accord with th058 records,. or the accounts do not comply the accounting requirements of Section 396 01 the 2006 Aet othèr than 8ny requirement that thè accounts give a true and lair view which is not a matter ￿nsid￿red as part of an independent examination,. or the accolsnts have not baèn prepared in accordance with the meihods and principles of the Statement of Recommended Practice for accounting and reporting by charities (appI￿able to charities proparing Ihtrir a carry out Its research work. Th8 loan is interest fre& and wsll only be ￿Payabl￿ If rev6nu8 1$ 9ontrr81gd frorn licensing its patents. 12. MOVEMENT IN FUNDS Net movem￿1 in funds Al 31112r21 At 111121 Unrestricted funds General fvnd 1326.7381 17251 1327,4631 TOTAL FUNDS 326,738} 327,463) Page 8 continued... PHELIX RESEARCH AND DEVELOPMENT NOTES TO THE FINANCIAL STATEMENTS- eontinued FOR THE YEAR ENDED 31 DECEMBER 2021 12. MOVEMENT IN FUNDS - contlnuèd Nel movemenl in knnds, included In the abovg are 8$ follows.. Incomir iesources Resources expended Movement in funds Unrestricted funds General fund 95.193 {9S,978} l7251 TOTAL FUNDS 95.193 95,9181 Cornparativ8s for mgverngnt in funds Net movement in funds At 111120 31112120 Unrestricted fvnds Gener81 fur 1308,7591 117,9791 1326,738) TOTAL FUNDS 308.7591 17.9791 326.7381 cOm￿rat4ve nel moVeM￿t in funds, included in thè èbove arè as follows-. Incoming resources Re8ource$ èxpendgd Movement in fvnds Unr•$trietèd funds General lund 96,064 (114.0431 (17.9791 TOTAL FUNDS 96,064 114.0431 17.9791 13. RELATED PARTY DISCLOSURES There were rK) related paty transactions for tha year end8d 31 Decèmbor 2021 that r9quify disdosLtre, other than Ihtr k)8n from Iru51ee as disdosed in note t1. Pagè 9