CYCLOPHARM LIMITED — AGM Information 2012

May 23, 2012

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Cyclopharm Limited

Annual General Meeting

24 May 2012

Disclaimer

Certain views expressed here contain information derived from publicly available sources that have not been independently verified.

The presentation includes certain statements, estimates and projections with respect to the anticipated future financial performance of Cyclopharm Limited and as to the markets for the Company’s products. Such statements, estimates and projections reflect various assumptions made by the directors concerning anticipated results, which assumptions may or may not prove to be correct. Cyclopharm Limited has not sought independent verification of the information in this presentation. While the directors believe they have reasonable grounds for each of the statements, estimates and projections and all care has been taken in their preparation, no representation or warranty, express or implied, is given as to the accuracy, completeness or correctness, likelihood of achievement or reasonableness of statements, estimates and projections contained in this presentation. Such statements, estimates and projections are by their nature subject to significant uncertainties, contingencies and assumptions.

To the maximum extent permitted by law, none of Cyclopharm Limited, its directors, employees or agents, nor any other person accepts any liability, including, without limitation, any liability arising out of fault or negligence, for any loss arising from the use of information contained in this presentation.

All references to dollars are to Australian dollars.

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Agenda

Chairman’s Address Managing Director’s Review Question Time Business Close

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Chairman’s Address

Vanda Gould

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Managing Director’s Review

James McBrayer

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Mission & Values

Strategy

To be the recognised world leader in pulmonary imaging and the Australasian manufacturing leader of radiopharmaceuticals used in Positron Emission Tomography

Mission

Cyclopharm’s mission is to enable nuclear medicine clinicians with the ability to improve patient care outcomes.

We will achieve this through strategic partnerships and the provision of diagnostic products and services to the global nuclear medicine community.

Values

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Honesty
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Integrity Customer service Regulatory compliance Shareholder value creation

We will deliver our mission ethically through our core values of:

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Cyclopharm business Three business units

Cyclopharm ‐ helping save lives everyday!

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Technegas

Established in 1986 continues to generate revenue, profits and strong cash flows through the manufacture and distribution of drugs and equipment for lung imaging

Radiopharmaceuticals

Establishment of PET central pharmacies to produce PET radiopharmaceuticals

Diagnostic Imaging

Developing centres that provide services ranging from specialised nuclear medicine to a full complement of imaging modalities

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Highlights – 2011

Delivering on our Strategy

• Technegas business strong and consistent with Patient Administration Sets (PAS) units increasing 4% over previous year

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• United States FDA approval of Special Protocol Assessment during Q1 2011. Investigational New Drug Application (IND) approved Q4 2011 following. Clinical trial to commence Q2 2012

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• Cyclotron facility completed its first year of operations

• PET Indications doubled from 10 to 20

• Productivity Commission investigates ANSTO and finds in our favour

• Diagnostic Imaging joint venture finishes 2012 with new shareholder

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• Net Capital Raising of $2.0m achieved December 2011

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Segmental Overview

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Technegas Global footprint

• Technegas is sold in 55 countries across the world

• Over 2,600,000 patient studies since 1986

• 170,000 patient studies conducted in 2011

• 1,240 Technegas generators sold globally

• Expanding operations in North America pending clinical trial and approval of United States FDA

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Asia
Americas,
Pacific,
18%
21%
Europe
plus
Other,
61%
Revenue by Region 10
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Molecular Imaging ‐ Positron Emission Tomography (PET)

PET is the future of Nuclear Medicine .

Positron Emission Tomography allows physicians to differentiate between healthy and active diseased tissue.

PET is primarily used in the detection of cancer but rapid growth in . other indications is also promising

From 1 July 2011 there has been an increase from 10 to 20 procedures covered under the Medicare Benefit Scheme

IMV Benchmark Report PET & PET CT 2008

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AGCNCO

Australian Government Competitive Neutrality Complaints Office

Competitive Neutrality Requires Government Enterprises to :

• Charge prices that fully reflect costs

• Pay, or include an allowance for, government taxes and charges such as goods and Services tax, payroll tax, stamp duties and local government rates

• Pay commercial rates of interest on borrowings

• Generate commercially acceptable profits

• • Comply with the same regulations that apply to private businesses (such as the Trade Practices Act and planning and environmental laws).

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ANSTO Fails to meet the standards of Competitive Neutrality Requirements

Finding 2.3….

“Revenue and Expenditure forecasts over 10 and 15 years demonstrate that PETNET Australia’s commercial operations are unlikely to achieve a commercial rate of return on equity invested over either time period. This represents an ex ante breach of competitive neutrality policy”

Since 1998 only 15 Investigations have ever been conducted by the AGCNCO

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Diagnostic Imaging

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• Joint venture with:

• 50% Alfred Health Solutions

• 30% Macquarie University

• 20% CycloPet

• Comprehensive suite of imaging modalities

• State of the art research platform

• Inpatient and outpatient services

• Foundation for regional growth

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PET
X‐Ray
CT
Cardiac
CT
MRI
Ultra‐
sound
SPECT
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Imaging Techniques

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X-ray , CT
Ultrasound
.
MRI MR Spectroscopy
fMRI
SPECT
PET with CT
CT= Computed tomography; MRI= Magnetic Resonance Imaging; fMRI- Functional MRI;
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SPECT- Single Photon Emission Computed Tomography; PET – Positron Emission Tomography
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2011 Financials

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Profit & Loss

Foundation strong while investing for the future

• TG revenue consistent with prior year with PAS volumes 4% higher

• $1,953k Loss from MUH Cyclotron activities

• $583k Loss from Molecular Imaging JV

		2011	2010
	Technegas Division Sales Revenue	$9,465,455	$9,442,763
	Profit before tax and Finance Costs	$1,699,883	$1,845,650
	Molecular Imaging
	Sales Revenue Loss Before Tax and Finance Costs (Operations)	$849,051 ‐$1,953,342	$21,842 ‐$527,571
	Loss Before Tax and Finance Costs
	(Including MMI)	‐$2,536,615	‐$838,943
	Consolidated
	Sales Revenue	$10,314,506	$9,464,605
	(Loss)/ Profit before tax and Finance
	Costs	‐$836,732	$1,006,707

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Sales revenue ‐ Segmental Review

Technegas sales volumes continue to rise

Technegas Revenue in $m Patient Administration Sets (PAS)

• PAS revenue flat from 2010

• PAS volumes up 4% from 2010

Technegas Generators

• Both revenue and volumes consistent with prior year

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7.4 7.3
1.3 1.2
2010 2011
PAS TG Generators
Technegas Volumes in units
3,259 3,395
54 55
2010 2011
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PAS TG Generators

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Sales revenue ‐ Segmental Review

Molecular Imaging ‐ MUH link provides advantage

Cyclopet

• First 12 months of operations recording revenues at $849k

• Strong competition from public sector cyclotron facilities

• Lag in indication approval/funding compared to the rest of the world

• MMI Imaging Joint Venture

• Macquarie University Hospital start‐up slower than expected

• Positive trending currently seen

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Sales revenue

Half year comparison

 Historical Trend – strong second half results

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8.0
0.51
6.0
4.0
6.78 0.34
6.19 6.19
4.32
2.0
3.27 3.28
0.0
2009 H1 2009 H2 2010 H1 2010 H2 2011 H1 2011 H2
Technegas CPET
$'m
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Foreign Exchange

European Volumes Historically Seasonal

CYC European Sales €

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2,500
2,000
1,500
1,000
500
0
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REV € '000
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• CYC has not historically taken a foreign exchange position

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• Given current Eurozone instability, a short‐term hedge may be considered appropriate to cover revenue generated in Q4

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Balance Sheet

 Improved Net Asset Position

• Renewed $5.1m bank facility • Net Capital Raising of $1.98m • Strong focus on inventory reduction	31‐Dec‐11 31‐Dec‐10 Current Assets $8,687,324 $8,409,488 Non‐current Assets $12,605,889 $13,732,411
	Total Assets $21,293,213 $22,141,899
	Current Liabilities $6,575,368 $7,978,925 Non‐current Liabilities $113,046 $396,820
	Total Liabilities $6,688,414 $8,375,745
	Net Assets $14,604,799 $13,766,154
	Inventory $2,487,081 $3,248,867

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Operating Cash flow

 Technegas cash flows offsetting start‐up costs

• Operating Activities for 2011 @ positive inflow of $564k • Significant cash was expended in the start up phase of both the cyclotron facility and MMI • $239k spent on FDA activities	31‐Dec‐11 31‐Dec‐10 Operating Activities $563,627 ‐$90,960 Investing Activities ‐$753,230 ‐$6,218,108 FinancingActivities $697,984 $3,369,503
	Net Inc /(Dec) in Cash $508,381 ‐$2,939,565 Opening Cash $1,541,644 $4,612,205 Foreign Exchange ‐$6,211 ‐$130,996
	Closing Cash $2,043,814 $1,541,644

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Business Outlook

2012

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Business Outlook Technegas

New Drug Application (NDA)

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• Investigational New Drug Application submitted and approved Q4 2011

• Clinical trial commencement to start within weeks

• Expected trial completion mid 2014 with commercialisation in 2015

New Indications for Technegas

• Collaborations underway with researchers and clinicians

• COPD and Lung Cancer targeted for potential new indications in global initiatives

Leverage Clinical Developments

• Promote new European Guidelines

• Underscore high radiation doses received from CT Pulmonary Angiography

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Business Opportunity Technegas

USA Market Potential

• USA is the largest single nuclear medicine market in the world

• Potential of up to 300,000 patient studies per

• annum

• Potential $23m in cumulative sales and $9.0m EBITDA in the first 2 years after receiving marketing authorisation

• Additional indications under development will drive further growth potential

• Clinical trial costs estimated at $4m USD

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Business Outlook PET Radiopharmaceuticals

Macquarie University Hospital (MUH)

• Continue to expand our FDG customer base in NSW

• Focus on new product development

• • Develop clinical research opportunities

Expansion Opportunities • Evaluate expansion opportunities within the Australasian region

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Business Outlook

Diagnostic Imaging ‐ MMI

• Macquarie University has taken 30% equity position in the venture

• No cash requirement budgeted in 2012

• Implement breast clinic services in collaboration with Macquarie University Hospital

• Expand Cancer Care Clinic visibility and service offering

• Leverage growth in PET

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Conclusion

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Cyclopharm business

Cyclopharm ‐ helping save lives everyday!

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Technegas

Established in 1986 continues to generate revenue, profits and strong cash flows through the manufacture and distribution of drugs and equipment for lung imaging

Radiopharmaceuticals

Establishment of PET central pharmacies to produce PET radiopharmaceuticals

Diagnostic Imaging

Developing centres that provide services ranging from specialised nuclear medicine to a full complement of imaging modalities

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Cyclopharm Business Summary

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Technegas

Radiopharmaceuticals

Diagnostic Imaging

• Long term view remains optimistic

• Consistent performer

• Continued growth in existing markets

• Productivity Commission report received in April 2012

• USA Clinical Trial to commence in 2012

• Potential legal remedy

• •

• USA Potential to triple Existing Growth the current company size opportunities in Queensland

• New Shareholder providing additional funding

• Patient volumes from hospital on the rise

• No further cash budgeted from CYC

• PPP

• Continue to fund operational losses

• Lock in financial performance outlook based on Productivity Commission outcome

• Additional product development is underway that will provide additional revenue streams commencing 2013

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Question Time & Business

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Proxy Summary

Resolution	Business	For*	Against	Abstain	Proxy’s discretion
1	Remuneration Report	148,345,840	118,633	-	25,000
2	Re-election of Mr Gould	148,459,302	-	5,171	25,000
3	Renewal of share buy- back capacity	148,450,589	13,884	-	25,000
4	Issue of shares under LTI Plan	148,321,243	143,230	-	25,000
5	Consolidation of Share Capital	148,389,814	74,659	-	25,000

*Includes Open Useable Proxies that have instructed the Chairman to vote on their behalf and have been voted in favour of the resolution.

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