2026 State of Validation Study Reveals Significant Headroom Remains for Further Digitization

• Event: Release of "State of Validation 2026" industry study by Kneat Solutions on April 30, 2026.
• Key Findings: The study surveyed over 600 global professionals regarding validation workload and digital maturity.
• Market Pain Points: 80% reported increased validation workload; significant reliance on paper remains (41% logbooks, 35% batch records).
• Digital Maturity Gap: Only 13% of organizations are "fully digital," despite nearly two-thirds using or implementing digital tools.
• AI Correlation: Organizations with established digital validation tools are significantly more likely to pilot AI (64% vs 13%).
• ROI Validation: 74% of those with implemented systems reported ROI met or exceeded predictions.
• Context: This follows the February 25, 2026 earnings release which highlighted an ARR of C$74M and a roadmap for AI-enabled features in 2026.

• Nature of News: The study serves as market validation rather than a discrete financial event (e.g., new contract or earnings beat). It reinforces the narrative established in Q4 2025 results regarding the necessity of digital transformation for AI adoption.
• Expectation Alignment: The findings align with previous management commentary on the "AI roadmap" and the need to digitize before deploying AI, which was already priced into the stock following the February earnings release.
• Market Reaction Potential: While positive sentiment is generated regarding total addressable market (TAM) expansion due to the paper-to-digital shift, this is a marketing/PR initiative rather than a revenue catalyst in itself. The stock has already rallied from March lows ($3.30) to April highs ($4.44), suggesting some optimism was priced in prior to this release.
• Materiality: Classified as Routine - Positive because it supports the existing growth thesis without introducing new financial data or contract wins that would alter valuation models significantly.

• Company: Kneat Solutions Inc. (TSX: KSI / OTCQX: KSIOF).
• Flagship Project: Kneat Gx digital validation platform for Commissioning, Qualification & Validation (CQV) in life sciences.
• Value Proposition: Digitizes paper-based GxP records to improve data integrity, compliance, and audit readiness while enabling AI deployment.
• Market Position: Claims to be the "global standard" with 8 of the top 10 pharmaceutical manufacturers as customers (per Feb 2026 shareholder letter).