Highlights

• Algorae Pharmaceuticals provided a supplementary announcement clarifying details of its NSW Health public hospital supply arrangement.

• AlgoraeRx has been appointed as one of several suppliers under a NSW Health standing offer arrangement.

• The arrangement has an initial three-year term, with two optional one-year extensions.

• First supply under purchase orders is expected in Q4 2026, with onboarding and rollout already underway.

• The company said there are no minimum volume or spend commitments, meaning financial impact cannot be quantified at this stage.

• Algorae does not expect the award alone to materially impact revenue in the current calendar year, but considers it a material step in its pathway to revenue.

Algorae Pharmaceuticals Ltd (ASX:1AI) has issued a supplementary announcement to clarify details of its NSW Health public hospital supply contract, following its earlier update released on 1 July 2026. The clarification provides additional information on the nature of the arrangement, customer structure, contract term, rollout timing, expected financial impact and confidentiality obligations.

The company confirmed that its wholly owned division, AlgoraeRx, has been appointed as a supplier under a NSW Health standing offer arrangement for an awarded pharmaceutical product. The specific product remains commercial-in-confidence and has not been disclosed.

During the afternoon session on 2 July 2026, Algorae Pharmaceuticals shares were trading flat at AUD 0.013. Over the past five days, the stock remains up 18.18%, reflecting recent investor attention around the company’s commercialisation update and public hospital supply pathway.

About Algorae Pharmaceuticals

Algorae Pharmaceuticals is an Australian AI-enabled pharmaceutical company operating through a dual-track strategy. The company combines AI-driven drug discovery with pharmaceutical commercialisation across Australia and New Zealand.

Its discovery business is built around AlgoraeOS, a proprietary artificial intelligence platform that applies machine learning and deep neural networks to identify synergistic drug combinations. The platform was developed in collaboration with the UNSW AI Institute, with support from CSIRO Data61. Its predictions have also been independently validated by the Peter MacCallum Cancer Centre.

AlgoraeOS supports a pipeline of AI-generated drug-combination candidates across oncology, neurodegenerative diseases and other complex conditions. Alongside this discovery work, the company’s wholly owned commercial division, AlgoraeRx, focuses on bringing specialty and generic medicines to market through distribution and supply partnerships.

Standing Offer Appointment Through AlgoraeRx

The supplementary announcement explains that AlgoraeRx has not been awarded an exclusive contract with guaranteed volumes. Instead, the company has been appointed as a supplier under a NSW Health standing offer arrangement.

The counterparty to the arrangement is the Health Administration Corporation, a statutory corporation under the Health Administration Act 1982 (NSW). Procurement is administered by HealthShare NSW.

Algorae said the appointment followed a competitive tender process in which the company met NSW Health’s supplier, quality and probity requirements. However, the company also clarified that it is one of several suppliers appointed under the arrangement, as NSW Health may appoint multiple parties to meet tender requirements.

This clarification is important because it explains the commercial structure of the award. Eligible customers, including local health districts and public hospitals, may place purchase orders for the awarded product at prices set out in an agreed schedule. However, the arrangement is not exclusive and does not require eligible customers to purchase minimum volumes.

Contract Term Covers Up to Five Years

The arrangement has an initial term of three years, with two optional one-year extension periods. This gives the contract a potential structure of 3+1+1 years.

The original 1 July announcement had also stated this term structure, and the supplementary announcement confirms the same timeline while adding more detail around the nature of the standing offer arrangement and the absence of volume commitments.

The company’s appointment therefore gives AlgoraeRx the ability to receive purchase orders during the term, subject to demand from eligible NSW Health customers.

Rollout Underway, First Supply Expected in Q4 2026

Algorae stated that onboarding and rollout are already underway. First supply under purchase orders is expected in Q4 2026.

The company also clarified that there are no conditions precedent to the rollout. This means the company does not need to satisfy additional pre-rollout conditions before supply can begin under purchase orders.

The awarded product is a pharmaceutical product supplied to NSW public hospitals and other eligible customers. However, its identity remains confidential due to commercial-in-confidence restrictions.

Financial Impact Cannot Yet Be Quantified

A key part of the supplementary announcement is the clarification around financial impact.

Algorae stated that although it regards the award as strategically significant, the arrangement does not include minimum volume or spend requirements. As a result, the company is currently unable to quantify the financial impact of the award.

The company also said it does not expect the award, by itself, to have a material impact on revenue in the current calendar year. However, it described the arrangement as a material step in developing the company’s pathway to revenue.

Revenue from the arrangement will depend on the volume and value of purchase orders received. Any revenue generated will be recognised within Algorae’s total product revenue and reported through periodic reporting, including quarterly cash flow reports.

Why the Clarification Matters

The supplementary announcement helps separate the strategic value of the NSW Health appointment from its immediate financial contribution.

The award gives AlgoraeRx approved supplier status within NSW public hospitals, one of Australia’s large public healthcare procurement networks. That status may support future purchase orders and broader commercial credibility.

At the same time, the company has made clear that the arrangement does not guarantee sales volumes or minimum spending. Therefore, while the appointment supports AlgoraeRx’s commercial pathway, it should not be treated as a quantified revenue contract at this stage.

The update is therefore positive from a strategic access perspective, but measured from a near-term revenue perspective.

Confidentiality Limits Product and Pricing Disclosure

Algorae also addressed confidentiality and continuous disclosure obligations.

The company said the specific product, pricing and volume information under the arrangement are commercial-in-confidence and cannot be disclosed at this time.

However, Algorae noted that confidentiality does not reduce its obligations under ASX Listing Rule 3.1 or section 674 of the Corporations Act 2001. The company said that because there are no committed volume or spend requirements, the confidential pricing and volume terms do not currently allow the financial impact of the award to be quantified.

Algorae added that it will make further disclosures if it receives orders that are individually or collectively material.

Strategic Significance for AlgoraeRx

Algorae considers the award strategically important because it establishes AlgoraeRx as an approved supplier to NSW public hospitals.

This matters for the company’s commercial division because it provides a pathway to receive purchase orders from eligible customers across the NSW Health network. It also supports Algorae’s broader dual-track model, where pharmaceutical commercialisation is intended to complement the company’s longer-term AI-driven drug discovery pipeline.

While revenue is not guaranteed, the appointment creates a framework through which AlgoraeRx can supply an awarded pharmaceutical product to public hospitals and other eligible customers over the contract term.

Earlier Announcement Confirmed Tender Award

The supplementary announcement relates to Algorae’s 1 July 2026 update, in which the company announced that it had been awarded a NSW Health public hospital supply contract following a competitive tender process.

That earlier update stated that onboarding and rollout were underway, first supply was expected in Q4 2026, and contract terms including pricing and volumes were confidential. It also noted that revenue would be recognised within the company’s total product revenue.

The 2 July announcement expands on that update by clarifying that the arrangement is a standing offer, that Algorae is one of several suppliers, and that there are no minimum volume or spend commitments.

What This Means for Investors

Algorae’s supplementary update provides important context around its NSW Health supply arrangement. The appointment is strategically relevant because it positions AlgoraeRx as an approved supplier within a major public healthcare procurement network. However, the company has clarified that the arrangement is non-exclusive and does not include minimum purchase volumes or committed spending. First supply is expected in Q4 2026, but near-term revenue impact remains uncertain and cannot currently be quantified. Investors are likely to monitor future purchase orders, quarterly product revenue reporting and any further material disclosures linked to the NSW Health arrangement.

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