Photocure ASA

Earnings Release • May 6, 2015

PHOTOCURE ASA BUILDING A SPECIALTY PHARMA COMPANY

RESULTS OF FIRST QUARTER 2015

6 MAY 2015

Kjetil Hestdal, MD, President & CEO Erik Dahl, CFO

DISCLAIMER

The information included in this Presentation contains certain forward-looking statements that address activities, events or developments that Photocure ASA ("the Company") expects, projects, believes or anticipates will or may occur in the future. These statements are based on various assumptions made by the Company, which are beyond its control and are subject to certain additional risks and uncertainties. The Company is subject to a large number of risk factors including but not limited to economic and market conditions in the geographic areas and markets where Photocure is or will be operating, IP risks, clinical development risks, regulatory risks, fluctuations in currency exchange rates, and changes in governmental regulations. For a further description of other relevant risk factors we refer to Photocure's Annual Report for 2014. As a result of these and other risk factors, actual events and our actual results may differ materially from those indicated in or implied by such forward-looking statements. The reservation is also made that inaccuracies or mistakes may occur in this information given above about current status of the Company or its business. Any reliance on the information above is at the risk of the reader, and Photocure disclaims any and all liability in this respect.

PROGRESS ON KEY OBJECTIVES

KEY OBJECTIVES 1Q2015 KEY ACHIEVEMENTS

•	Hexvix/Cysview global in-market unit sales growth of ≥10%	• • •	10% growth in-market value to 51 MNOK 61% in-market unit growth in US Commercial franchise profitability of 4.2 MNOK
•	Submit Special Protocol Assessment Request (SPAR) by mid-2015	•	Submitted in 1Q2015
•	Initiate Phase 3 clinical trial to expand the use of Hexvix/Cysview into the surveillance market and fulfill the US post marketing commitments in 2015	•	Progressed according to plan to start patient enrollment by end of 2015

• Secure partnership for further development and commercialization of Visonac and Cevira reflecting the product potential
• Discussions continued with potential partners

Improved financial performance (EBIT) with 6.5 million NOK

Commercial Update

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HEXVIX/CYSVIEW A SIGNIFICANT GLOBAL SPECIALTY BRAND

• Value of in-market sales of Hexvix/Cysview increased YoY 10% in the quarter to NOK 184 million LTM
• Hexvix/Cysview global in-market volume declined YoY 1% in the quarter, partly driven by purchases in advance of an April 2014 price increase in Germany
• Overall franchise operating profit in the quarter at NOK 4.2 million, improvement of NOK 4.2 million

Global in-market value NOK mill (LTM)

HEXVIX/CYSVIEW SOLID PERFORMANCE IN NORDICS AND USA

• Photocure own sales revenue in the US and Nordics increased 44% YoY in 1Q to NOK 12.8 million
• US revenue increased 116% YOY
• Driven by in-market volume growth of 61%, price increases and Fx
• Permanent Blue Light Cystoscope placements of 52 at the end of 1Q
• Actively pursuing passage of bill to provide separate payment to hospitals for Cysview
• Nordic revenue in 1Q increased 22% YoY
• In-market volume growth of 6%
• Continued double digit in-market volume growth in Sweden

Own Hexvix/Cysview in-market unit sales

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HEXVIX/CYSVIEW PROGRESS IN EUROPE

• Partner revenue increased 33% in 1Q
• Driven by timing of inventory replenishments in the 1Q 2014
• 1Q end user volume reduction YoY of 5%
• Decline driven by high sales during first quarter 2014 in advance of price increase in Germany in April 2014
• Double digit growth in France and UK
• NICE in UK recommends PDD in first guideline on bladder cancer

Hexvix Partner Unit Sales Per Quarter

Pipeline Update

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CREATING VALUE CLINICAL DEVELOPMENT PROGRAMS

	Technology	Indication	Phase 1	Phase 2	Phase 3	Status
Cevira®	PDT	Treatment of precursors of cervical cancer				Positive Phase 2b results Submitted SPAR request in 1Q Exploring partnerships
Visonac®	PDT	Treatment of moderate to severe acne				Positive Phase 2b results SPA and PIP approved Exploring partnerships
Hexvix® Cysview®	PDD	Detection of bladder cancer, surveillance segment				Phase 3 clinical study initiated. Patient recruitment is planned to start 3Q 2015

CEVIRA A MAJOR OPPORTUNITY

• Breakthrough single use and fully integrated drug-device technology to satisfy high need for novel therapies to treat global epidemic of HPV/CIN populations
• A well tolerated non-systemic treatment option for patients which preserves fertility and avoids the morbidities of invasive surgery
• Results of the Phase 2b trial are significant
• Statistically significant HSIL (CIN2,3) regression in the FDA agreed phase 3 patient population (p=0.004)
• Statistically significant virologic clearance of oncogenic HPV at 9 months after first treatment (p=0.045)
• Excellent tolerability and high physician & patient acceptance
• Continuing progress in determining next steps in development
• Submitted Special Protocol Assessment Review (SPAR)
• Confirmed readiness for Phase 3 with major EU regulators

CEVIRA SIGNIFICANT SALES POTENTIAL

• Large patient population based on biopsy confirmed histology of HSIL
• ~1M cases HSIL annually in US & West EU1,2 detected through routine cervical screening programs; 50% of these are caused by HPV strain 16 or 18³
• ~30% risk of progress to cervical cancer⁴
• Upside exists in Latin America, Asia and East EU, where burden of HPV is higher
• LCM Opportunity for clearance of oncogenic HPV in patients with normal cytology/LSIL
• It is estimated that ~35M are HPV infected in US & EU, with a prevalence of HPV strains 16 or 18 of 32% (~11M)
• 10-15M cases oncogenic HPV annually in US & West EU⁶ detected through routine cervical screening programs
• Persistent infection occurs in 10-20% of the cases⁷
• Blockbuster sales potential based on premium pricing opportunity
• At premium price levels, cost impact model demonstrates cost savings / benefit to the US health care system as compared to current treatment practice⁵
• Additional significant savings when avoidance of costs associated with preterm births factored in⁵
• Continued discussions with potential partners for development and commercialization

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VISONAC PHASE 3 READY ASSET

• High unmet need for novel treatments for moderate/ severe acne
• 1 st Photodynamic treatment for inflammatory acne
• Broad geographic fit
• Positive Phase 2b results
• Significant reduction in inflammatory lesions
• Overall improvement in acne severity
• Well tolerated regimen
• Phase 3 Ready
• SPA (US) and PIP (EU) agreed for global registration program
• Development and regulatory risks significantly reduced

VISONAC CONSIDERABLE SALES POTENTIAL

• Value of moderate to severe acne pharma market segment estimated at ~\$900 MUSD globally
• Dermatologist main prescriber of oral antibiotics and retinoids
• Visonac positioned as second line alternative
• In US and EU, >2M patients in need of second line treatment options
• Favorable benefit/risk profile compared to existing treatment options and sustained efficacy allows for premium price
• Continued interest from potential partners for development and commercialization

HEXVIX/CYSVIEW EXPANDING INTO THE SURVEILLANCE SEGMENT

• Surveillance following initial diagnosis represents a significant growth opportunity of 2-3 times current TURB segment
• Initiation of Phase 3 study with 360 patients for examining improved detection rate of Cysview blue light cystoscopy vs white light cystoscopy
• Secured alignment with FDA on study design necessary to obtain label extension

Financials

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HEXVIX/CYSVIEW CONTINUED GROWTH FIRST QUARTER 2015

• Revenue from own sales of Hexvix/ Cysview increased 44% in 1Q YoY
• Nordic 1Q revenue growth of 22%
• US revenue increased 116% in 1Q
• Partner 1Q revenue increased 33% YoY
• Changed timing of supply to partner compared to the same period in 2014
• Total in market sales value increased 10% in 1Q YoY
• LTM value NOK 184 million

SALES - MNOK	Q1 '15
Hexvix own sales	12,8
YoY growth	44 %
Hexvix partner sales	13,9
YoY growth	33 %
Total Photocure	26,7
YoY growth	38 %
Revenue in-market (*)	50,6
YoY growth	10 %
Units in-market (*)	13 214
YoY growth	-1 %

(*) Calculated in-market sales

PROFIT & LOSS FIRST QUARTER 2015

• Revenue increase of 43% YoY
• Other sales revenue is sales of active ingredients.
• Operating expenses increase 6% YoY
• R&D expenses at NOK 7.1 million in 1Q, down 19% from last year.
• 1Q S&M expenses at NOK 17.2 million, YoY increase of 22%, significantly impacted by FX.
• 1Q operating loss (EBIT) at NOK 7.2 million
• Improvement of NOK 6.5 million from last year

MNOK	Q1 '15	Q1 '14	Change
Hexvix / Cysview revenues	26,7	19,3	38 %
Other sales revenues	1,7	0,2	>100%
Signing fee and milestones	1,2	1,2	5 %
Total revenues	29,6	20,7	43 %
Gross profit	27,6	19,1	44 %
Operating expenses	-34,8	-32,9	6 %
Operating profit/loss(-)	-7,2	-13,7	-48 %
Profit/loss(-) before tax	-7,0	-13,0

Operating expenses NOK mill

SEGMENTS FIRST QUARTER 2015

• Segment reporting changed from 2015:
• Commercial franchise:
• Hexvix /Cysview by sales channel, own sales and partner sales
• Other sales, currently including sale of active ingredients.
• Development portfolio:
• Split by development of commercial products and pipeline products

MNOK	Q1 '15	Q1 '14	Change	LTM	FY '14
Commercial Franchise
Total revenues	29,6	20,7	43 %	107,1	98,2
Gross profit	27,6	19,1	44 %	99,7	91,2
Operating expenses	-23,4	-19,1	23 %	-79,6	-75,3
EBIT	4,2	0,0	#####	20,1	15,9
Development Portfolio
Total revenues	0,0	0,0		0,0	0,0
Gross profit	0,0	0,0		0,0	0,0
Operating expenses	-11,4	-13,8	-17 %	-49,9	-52,3
EBIT	-11,4	-13,8	-17 %	-49,9	-52,3
Total
EBIT	-7,2	-13,7	-48 %	-29,8	-36,4
(*) One-Off's excluded
Salix termination fee				30,8	30,8

CASH FLOW FIRST QUARTER 2015

• 1Q cash flow from operations NOK -11.9 million.
• Improvement of NOK 6.8 million from last year.
• Working capital net outflow of NOK 4.8 million.
• 1Q cash flow from investments NOK -3.6 million.
• Includes investments of NOK 5.3 million in the initiation of a phase 3 post-marketing commitment trial.
• Quarter end cash balance at NOK 150 million.

MNOK			Q1 '15 Q1 '14 Change
Cash flow from:
- Operations	$-11,9$	$-18,7$	$-36%$
- Investments	$-3,6$	1,1
- Financing	0,0	0,0
Net change in cash	$-15,5$	$-17,5$	$-12%$
Ending cash balance	149,7	149.7	$0\%$

BALANCE SHEET PER 31 MARCH 2015

• Non current assets includes NOK 19 million in shares in PCI Biotech and deferred tax asset of NOK 27 million
• No interest bearing debt at quarter end
• Shareholder's equity of NOK 233 million
• Equity ratio of 90%
• Photocure held 35,476 own shares at end of quarter

MNOK	31.03 2015	31.12 2014
Non-current assets	80,4	76,5
Inventory & receivables	30,0	28,8
Cash & equivalents	149,7	165,2
Total assets	260,1	270,6
Shareholders equity	233,0	240,1
Long term liabilities	3,3	3,1
Current liabilities	23,9	27,5
Total equity & liabilities	260,1	270,6
Equity ratio	90 %	89 %

Outlook

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OUTLOOK

FINANCIAL

• Hexvix/Cysview global in-market unit sales growth of ≥10% in 2015

• Submit Special Protocol Assessment Request (SPAR) by mid-2015

CLINICAL

• Initiate Phase 3 clinical trial to expand the use of Hexvix/Cysview into the surveillance market and fulfill the US post marketing commitments in 2015

PARTNERSHIP

• Secure partnership for further development and commercialization of Visonac and Cevira reflecting the product potential