Centogene N : Annual Statutory Report Centogene NV 2022

CENTOGENE N.V.

Dutch Statutory board report and financial statements

for the fiscal year ended December 31, 2022

		TABLE OF CONTENTS
Board Report	2
1	Introduction	2
1.1	Preparation	2
1.2	Forward-looking statements	3
2	Risk factors	5
2.1	Summary risk factors	5
2.2	Risk factors	7
3	Information on the Company	66
3.1	History and development of the Company	66
3.2	Business overview	67
3.3	Organizational structure	106
3.4	Property, plants and equipment	107
4	Operating and Financial Review and Prospects	108
4.1	Operating Results	108
4.2	Liquidity and Capital Resources	123
5	Legal Proceedings	127
6	Controls and Procedures	128
6.1	Risk Management and Control Systems	128
6.2	Statement by the Management Board	130
7	Corporate Governance	130
7.1	Dutch Corporate Governance Code	131
7.2	Code of conduct and other corporate governance practices	133
7.3	General meeting	133
7.3.1	Functioning of the General Meeting	133
7.3.2	Powers of the General Meeting	133
7.3.3	Shareholder rights	133
7.4	Management Board	133
7.5	Supervisory Board	135
7.6	Committees	138
7.6.1	General	138
7.6.2	Audit committee	138
7.6.3	Compensation committee	141
7.6.4	Nomination and corporate governance committee	142
7.7	Evaluation	142
7.8	Diversity	142
8	Compensation	143
8.1	Compensation policy	143
8.2	Compensation of managing directors	143
8.3	Pay ratio	143
9	Related party transactions	144
10	Protective measures	146
11	Other information	146
11.1	Profit appropriation provisions	146
11.2	Branches	146
Consolidated Financial Statements	148
Company Financial Statements	214
Other information	228
Independent auditor's report	229

1

1. INTRODUCTION 1.1. Preparation

The statutory board (bestuursverslag) report as referred to in Section 2:391 DCC is formed by chapters 1 to 11.

In this report ("Annual Report"), the terms "we", "us", "our" and "the Company" refer to Centogene N.V. and, where appropriate, its subsidiaries.

This report has been prepared by the Company's management board (the "management board") pursuant to Section 2:391 of the Dutch Civil Code ("DCC") and also contains (i) the Company's statutory annual accounts within the meaning of Section 2:361(1) DCC and (ii) to the extent applicable, the information to be added pursuant to Section 2:392 DCC. This Annual Report relates to the fiscal year ended December 31, 2022 and, unless explicitly stated otherwise, information presented in this Annual Report is as at December 31, 2022.

1.2. Forward-looking statements

This Annual Report contains statements that constitute forward-looking statements. All statements other than present and historical facts and conditions contained in this Annual Report, including statements regarding our future results of operations and financial position, business strategy, plans and our objectives for future operations, are forward-looking statements. When used in this Annual Report, the words "anticipate," "believe," "can," "could," "estimate," "expect," "intend," "is designed to," "may," "might," "plan," "potential," "predict," "objective," "should," or the negative of these and similar expressions identify forward-looking statements.

Forward-looking statements are based on our management's beliefs and assumptions and on information currently available to our management. Such statements are subject to risks and uncertainties, and actual results may differ materially from those expressed or implied in the forward-looking statements due to various factors, including, but not limited to, those identified under "2. Risk Factors" in this Annual Report. These risks and uncertainties include factors relating to:

• our ability to generate cash from operations and attract financing;
• our strategic restructuring initiative and the related restructuring cost;
• our ability to effectively manage our future growth and to execute our business strategy;
• our ability to generate sufficient revenue from our relationships with our pharmaceutical partners and clients, and to otherwise maintain our current relationships, or enter into new relationships, with pharmaceutical partners and clients;
• the effects of the COVID-19 pandemic on our business and results of operations;
• economic, political or social conditions and the effects of these conditions on our pharmaceutical partners' and diagnostics clients' businesses and levels of business activity;
• our expectations for our products and solutions achieving commercial market acceptance, and our ability to keep pace with the rapidly evolving industry in which we operate;
• our assumptions regarding market size in the rare disease industry and our growth potential;
• our pharmaceutical partners' and clients' need for rare disease information products and solutions and any perceived advantage of our products over those of our competitors;

2

• our ability to manage our international expansion, including our exposure to new and complex business, regulatory, political, operational, financial, and economic risks, and numerous and conflicting legal and regulatory requirements;
• our continued reliance on our senior management team and other qualified personnel and our ability to retain such personnel;
• our ability to obtain, maintain, protect and enforce sufficient patent and other intellectual property protection for any products or solutions we develop and for our technology;
• the ongoing protection of our trade secrets, know-how, and other confidential and proprietary information;
• our ability to remediate our material weaknesses in internal control over financial reporting;
• general economic, political, demographic and business conditions in North America, the Middle East, Europe and other regions in which we operate;
• changes in government and industry regulation and tax matters;
• other factors that may affect our financial condition, liquidity and results of operations; and
• other risk factors discussed under "2. Risk Factors."

You should refer to the section of this Annual Report titled "2. Risk Factors" for a discussion of important factors that may cause our actual results to differ materially from those expressed or implied by our forward-looking statements. As a result of these factors, we cannot assure you that the forward-looking statements in this Annual Report will prove to be accurate. Furthermore, if our forward-looking statements prove to be inaccurate, the inaccuracy may be material. In light of the significant uncertainties in these forward-looking statements, you should not regard these statements as a representation or warranty by us or any other person that we will achieve our objectives and plans in any specified time frame or at all. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

1.3 Corporate Governance Statement

This statement is included pursuant to Section 2(a) of the Decree on the Content of the Directors' Report (Besluit inhoud

bestuursverslag) and is also publicly available in digital form in the Corporate Governance section of the company website https://investors.centogene.com/corporate-governance.

The information that must be included in this statement pursuant to Sections 3, 3(a), and 3(b) of said decree can be found in

the following sections of the 2022 directors' report. The sections referred to below should be regarded as included and repea ted here:

• information on compliance with the principles and best-practice provisions of the 2016 Corporate Governance Code
  (Chapter 7 'Corporate Governance');
• information on the principal features of the management and control system in connection with the Group's financial reporting process (Chapter 6.1 'Risk management and control systems');
• information on the functioning of the General Meeting of Shareholders and its principal powers, and on the rights of shareholders and how these can be exercised (Chapter 7.3 'General Meeting');
• information on the composition and performance of the Management Board (Chapter 7.4 'Management board");
• information on the composition and performance of the Supervisory Board and its committees (Chapter 7.5
  'Supervisory board' and Chapter 7.6 'Committees');
• policy on diversity in the composition of the Management and Supervisory Boards (Chapter 7.8 "Diversity");

3

To the extent appropriate, information is also given below pursuant to the Decree implementing Article 10 of the Takeover Directive (Besluit artikel 10 Overname richtlijn).

• the company's capital structure, the existence of different types of shares and the associated rights and obligations and the percentage of issued share capital represented for each type (Note 17 "Equity" of the consolidated financial statements);
• every limitation imposed by the company on the transfer of shares issued with the company's cooperation (Chapter
• 1. 'Powers of the General Meeting');
• every limitation on voting rights and deadlines for exercising voting rights with the company's cooperation (Chapter
• 1. 'Shareholders right");

the regulations regarding appointment and dismissal of Management Board members and Supervisory Board members and changes to the articles of association (Chapter 7.3.2 'Powers of the General Meeting')

4

2. Risk Factors

2.1 Summary Risk Factors

In the course of conducting our business operations, we are exposed to a variety of risks, some of which are inherent in our industry and others of which are more specific to our own businesses. The discussion below addresses the material factors, of which we are currently aware, that could affect our businesses, results of operations and financial condition and make an investment in the Company speculative or risky.

The company has initiated a Corporate Risk Management exercise and with the company's emphasis on technology, the Risk Management activity is owned by the Chief Information Officer.

• The activities completed and presented at this time were (non-exhaustive):
• Implementation of Risk Management in IT
• Presentation of Corporate Risk Management approach to SVB
• Initial company-wide risk assessment and calibration
• On a more granular level, the applied methodology was aligned with common best practice using the following levers:
• Impact: 1-Negligible,2-Minor,3-Moderate,4-Critical,5-Catastrophia
• Likelihood: Less than 1:10,000 (very unlikely), 1-1,000 to 1:10,000 (unlikely), 1:100 to 1:1,000 (occasional), 1:10 to 1:100 (probable), above 1:10 (frequent)

This methodology is applied for the initial risk evaluation leading to the determination of expected "residual risk" after mitigation action.

The company has progressed in drafting a more elaborate risk charter for Enterprise Risk Management aiming to structure a concise and equally comprehensive activity. The draft lists the four key risks in each of the following:

• Macro Environment
• Legal & Regulations
• Financial
• Business Support/Plan
• HR
• Corporate Value
• Industry
• Market
• Business Continuity
• Compliance

5

• Customer Excellence
• Quality & Regulatory

In parallel, the company's Quality and Regulatory Affairs function has initiated a holistic risk management exercise with focus on the prevailing laws and regulations impacting our core business. This function is being shaped and structured throughout 2022 and 2023.

The risk management framework is currently under development therefore not all required disclosures are included, however this will be updated in the 2023 financial year.

6

The principal risks and uncertainties which the Company faces include the risks and uncertainties summarized in this chapter [2.1]. See chapter [2.2] of this report for additional detail and additional risks and uncertainties which the Company faces. Some of these risks include:

Certain Factors Relating to Our Business and Strategy

• Our strategic restructuring initiative may not achieve intended benefits and the related restructuring cost could have a material adverse effect on our business and results of operations.
• We may fail to generate sufficient revenue from our relationships with our clients or pharmaceutical partners to achieve and maintain profitability.
• Many events beyond our control, including geopolitical events, may adversely affect our business.
• We may fail to maintain our current relationships with pharmaceutical companies or enter into new relationships on a similar scale.
• Difficulty in successfully identifying patients for our pharmaceutical partners due to relatively small patient populations for rare diseases.
• We may fail to generate sufficient volumes of data from our diagnostic tests for inclusion in our data repository.
• Volatile, negative or uncertain economic, political or social conditions and the effects of these conditions on our pharmaceutical partners' and diagnostics clients' businesses and levels of business activity.
• We derive a large proportion of our revenues and equipment from agreements with a limited number of pharmaceutical partners and suppliers, respectively.
• Restrictions or delays in the receipt of patient samples to our laboratories for diagnostic testing.
• Substantial product liability or professional liability claims that could exceed our resources.
• Challenges to patient consent validity could impede our rare disease information development efforts.
• Interruption of access or damage to our highly specialized laboratory facilities, storage facilities or equipment.
• Pandemics, epidemics, disease outbreaks and other public health crises, such as the COVID-19 pandemic, have disrupted our business and operations, and future outbreaks or reemergence of the COVID-19 pandemic could materially adversely impact our business, financial condition, liquidity, and results of operations.
• Failure in our information technology systems.
• We rely on a limited number of suppliers, or, in some cases, a sole supplier, for some of our laboratory equipment and may not be able to find replacements or immediately transition to alternative suppliers.
• Inability to attract and retain new talent, including members of our senior management team.
• New and complex business, regulatory, political, operational, financial, and economic risks as a result of international business expansion.
• Unanticipated difficulties involved in the implementation of partnership agreements with our pharmaceutical partners.
• Failure to achieve or maintain sales of our products and solutions.
• Failure to manage our future growth effectively, which could make it difficult to execute our business strategy.
• Inability to successfully commercialize new products or solutions on a timely basis or at all.
• Failure to expand our direct sales and marketing force to adequately address our pharmaceutical partners' and clients' needs.
• The knowledge and interpretation-based solutions we provide to our pharmaceutical partners may not achieve significant commercial market acceptance.
• Failure to keep pace with the rapidly evolving industry in which we operate.
• We may fail to successfully respond to increasing demand for our products and solutions.
• Failure to obtain favorable pricing for our products and to meet our profitability expectations.
• Ethical, legal and social concerns related to the use of genomic information could reduce demand for our genetic rare disease knowledge and interpretation-based products and solutions.
• Our resource allocation decisions may lead us to focus on research and development programs that are not commercially viable, and as a result we may be unable to recover the costs incurred under these efforts.
• Failure to compete successfully with competitors, including new entrants in the market.
• If our pharmaceutical partners experience any of a number of possible unforeseen events in connection with their clinical trials, our ability to commercialize future solutions or improvements to existing solutions could be delayed or prevented.
• Our employees, principal investigators, consultants, and commercial partners may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements, insider trading, misappropriation of trade secrets and wrongful use or disclosure of confidential information.

7

• We may lose the support of key thought leaders and fail to establish our products and solutions as a standard of care for patients with rare and neurodegenerative diseases.
• Security breaches, loss of data, and other disruptions could compromise sensitive information related to our business or prevent us from accessing critical information and expose us to liability, which could adversely affect our business and our reputation.
• We are subject to significant foreign currency exchange controls in certain countries in which we operate.
• We may acquire assets or other businesses that could negatively affect our operating results, dilute our shareholders' ownership, or increase our debt.
• We may enter into joint ventures with third parties, which may subject us to various risks, including limited decision-making authority, reliance on our joint venture partners' financial condition and the risk of disputes with our joint venture partners, which could adversely affect us.
• Regulatory risks including as a result of conflicting requirements, regulatory changes in the way that the FDA and the European Union regulate laboratory developed tests, non-compliance with FDA and EMA regulatory requirements and with evolving European and other data privacy laws, violations of worldwide anti bribery laws, transactions involving Iran or other sanctioned countries, and our inability to obtain timely regulatory approvals or adhere to regulations regarding our products and solutions.
• We may fail to achieve coverage or adequate reimbursement for our products and solutions by commercial third-party payors or government payors.
• Inspections, reviews, audits and investigations under federal and state government programs and contracts and health insurance providers regarding our billing practices.
  Intellectual Property Risks Related to Our Business
• Inability to obtain and maintain patent and other intellectual property protection for any products or solutions we develop and for our technology, allowing our competitors to develop and commercialize products and solutions similar or identical to ours.
• Additional intellectual property risks, including our inability to protect the confidentiality of our trade secrets, know how, and other confidential and proprietary information, the unenforceability of our patents and intellectual property rights, third party claims of intellectual property infringement or commercial rights to inventions we develop, non-compliance with patent agency requirement and dependence on licenses granted to us by others.
  Risks Relating to Our Financial Condition and Capital Requirements
• We have a history of losses, and we may incur losses in the future.
• We will require additional funding, which may not be available to us in the desired amount, at the desired time or on acceptable terms, or at all.
• Failure to obtain additional capital to fund, develop and expand our operations.
• We may fail to meet covenants in our debt agreements, which could result in acceleration of our payment obligations under our debt agreements, limit our operating and financial flexibility and in an event of default, result in losses to the assets securing our debt obligations.
• Increasing our financial leverage could affect our operations, profitability, and ability to raise additional capital.
• We may be required to refund grants and subsidies and may fail to meet covenants under loan facilities.
• Our results of operations could be materially adversely affected by fluctuations in foreign currency exchange rates.
• We have identified three material weaknesses in our internal control over financial reporting and may identify additional material weaknesses in the future that may cause us to fail to meet our reporting obligations or result in material misstatements of our financial statements. If we fail to remediate our material weaknesses or establish and maintain an effective system of internal control over financial reporting, we may not be able to report our financial results accurately or to prevent fraud, and such failure could cause investors to lose confidence in our reported financial and other public information and have a negative effect on the trading price of our common shares.
  Certain Factors Relating to Our Common Shares

8

• Risks relating to our common shares, including fluctuations in our share price, risk of dilution upon future issuances, multi- jurisdictional tax consequences, impacts of our Dutch public company status (including differing shareholder rights), risks resulting from our emerging growth company and foreign private issuer status, our non-payment of dividends and our broad discretion in the use of our cash on hand.
• We may in the future not comply with all of Nasdaq's continued listing standards and our common shares could be delisted.
• Failure to comply with Nasdaq's rules governing the diversity of our board of directors.
• Although we do not believe that we were a "passive foreign investment company," or a PFIC, for U.S. federal income tax purposes for 2022, there is a significant risk that we may be a PFIC for 2023 or one or more future taxable years. If we are a PFIC for any taxable year, U.S. shareholders may be subject to adverse U.S. federal income tax consequences.

The company does not have effective risk management and control systems in place. The management board is responsible for identifying and managing the risks associated with the company's strategy and activities. This activity is currently being reviewed and will be implemented in following financial year.

2.2 Risk factors

Additional factors discussed below could affect our business, prospects, financial condition and results of operations. You should carefully consider the following risks and uncertainties and all of the other information in this Annual Report before making any investment decision. Our business, financial condition or results of operations could be materially and adversely affected if any of these risks occurs, and as a result, the market price of our common shares could decline and you could lose all or part of your investment. The risks described below are those that we currently believe may materially affect us. We may face additional risks and uncertainties not currently known to us or that we currently deem to be immaterial.

Certain Factors Relating to Our Business and Strategy

Our strategic restructuring initiative may not achieve intended benefits and the related restructuring cost could have a material adverse effect on our business and results of operations.

In November 2021, our management board and supervisory board approved a restructuring plan to further reduce operating costs and improve profitability. The estimated total restructuring charges, which consist of personnel costs and one-time severance charges, was approximately €640 thousand during 2021 and 2022. In March 2022, the plan finalized and the amount of the incurred costs was approximately €740 thousand. In addition, on February 1, 2022, we announced the resignation of Dr. Andrin Oswald as CEO due to prolonged medical leave of absence and the appointment of Kim Stratton as CEO.

We are pursuing a number of additional restructuring initiatives that could extend our cash runway until our operating cash flows reach break-even. In addition to measures intended to reduce our operating expenditure, we are in active discussions with various counterparties regarding new private equity financing and/or additional debt (which may be convertible debt) financing.

The process to undertake these restructuring initiatives could take more time and be more costly than anticipated, and we may not be able to obtain the anticipated operational improvements within the contemplated timing or at all. The restructuring initiatives could also place substantial demands on our management, which could lead to the diversion of management's attention from other business priorities. Further, the restructuring may yield unintended consequences such as attrition beyond our targeted workforce reduction. The Company's success is dependent on the skills of our key personnel. Our restructuring plan involving workforce reduction may lead to an unintended loss of experienced employees or know-how. The loss of any member of our key personnel and actual or threatened work slowdowns or stoppages could lead to operational delays or cost increases. In addition, if we reduce or

eliminate some or all of our research and development programs, this could cause significant delays in our preclinical, clinical and regulatory efforts, which could adversely affect our business prospects. If these incidents occur or if we are unable to attract,

retain and maintain productive relations with our employees and key professionals, we might fail to deliver under existing commitments to third parties, which could harm our business and negatively affect our operating results and financial condition.

9