Ann: Market Update, page-2

Not much comment on the market update, however there are a few little changes to the interim announcement a couple of days ago. Hard to believe OIL is this close to market release of two products and still not on the radar. I guess that will/might change over coming days and weeks. Management are intent on keeping shareholders updated and I can`t believe they won`t be up to keeping to dates in the programme.

A very successful visit to the CZM headquarters in Germany by CEO Archie Fraser (Feb 2017) has further solidified the OIL/CZM relationship, ensured parallel direction and determined key milestones for 2017 and beyond.

o Sales of Production Equivalent Systems (PES) to CZM took place in Dec-16 and Feb-17.

o The PES units have been tested fully by CZM who have confirmed that these units are now production ready.

o Order for additional PES have been received - to be delivered in May-17.

o Commencement of discussions with a Melbourne based high quality manufacturer with a view to assisting Optiscan in meeting future production demands into 2017 and well beyond.

Sales of ViewnVivo – our second-generation pre-clinical research product:

o Optiscan was the Major Sponsor of the prestigious National Conference of Light Microscopy Australia (LMA) held in Melbourne on 1-3 February 2017.

o Australian research organisations have already applied for grants for purchase of the ViewnVivo units in advance of production later this financial year.

o Discussions have commenced with potential Distribution Partners for the ViewnVivo product including increased involvement from MR Solutions in 2017.

o ViewnVivo marketing activity is progressing well with both local and overseas market engagement.

o Commencement of discussions with a Melbourne based high quality manufacturer with a view to assisting Optiscan in meeting future production demands into 2017 and well beyond.