MAYNE PHARMA GROUP LIMITED — AGM Information 2017

Nov 27, 2017

==> picture [149 x 78] intentionally omitted <==

Mayne Pharma Group Limited Annual General Meeting 28 November 2017

==> picture [90 x 90] intentionally omitted <==

----- Start of picture text -----

1
----- End of picture text -----

US generic industry dynamics

• Consolidation of customers and payers

• Acceleration of generic approvals by FDA

• Aggressive competition and pricing activities impacting the generic market

• Accelerated price deflation being reported by US generic peers

• High single - mid teen digits

• Industry experiencing declining generic revenue and gross profit margins

• ─ -5% to -15% revenue declines

• ─ Some peers reporting 1,000 basis point reduction in gross margins

	Share Price	Performance (% change)	Performance (% change)	Performance (% change)
	Company	1-Year	2-Year	3-Year	5-Year
		(60%)	(45%)	(9%)	+150%
		(64%)	(78%)	(77%)	(66%)
		+3%	(28%)	(33%)	+41%
		+23%	(61%)	(45%)	(17%)
		(53%)	(87%)	(89%)	(72%)
		+20%	(32%)	(44%)	+462%

==> picture [90 x 90] intentionally omitted <==

----- Start of picture text -----

2
----- End of picture text -----

Sources. Bloomberg data as at 22 November 2017.

FY17 key financial metrics[1]

Reported basis Revenue A$572.6m,

+114%

Reported basis EBITDA

• A$204.0m, +165%

==> picture [179 x 98] intentionally omitted <==

----- Start of picture text -----

Underlying basis
EBITDA [2]
 A$206.5m, +133%
----- End of picture text -----

==> picture [179 x 98] intentionally omitted <==

----- Start of picture text -----

Reported basis
NPAT
 A$88.6m, +137%
----- End of picture text -----

==> picture [179 x 98] intentionally omitted <==

----- Start of picture text -----

Reported basis
EPS
 6.2 cents, +30%
----- End of picture text -----

• (1) EBITDA and NPAT is profit attributable to members of the Company.

(1) (2) Adjustments to reported EBITDA include A$22.4m net patent litigation gains (A$26.2m of patent settlement income less A$3.8m of litigation expenses relating to Mayne Pharma’s allegation that Merck’s Noxafil® product infringes a Mayne Pharma patent); A$20.2m intangible asset impairment; A$5.6m of transaction and other related costs; A$5.3m credit for the revaluation of HPPI warrants; A$1.5m of legal costs associated with the US Department of Justice investigation and A$2.9m to remove the HedgePath Pharmaceuticals Inc. (HPPI) losses attributable to members of the Company.

==> picture [90 x 90] intentionally omitted <==

----- Start of picture text -----

3
----- End of picture text -----

Generic Products Division (GPD)

• FY17 revenue increased by 292% to A$419m

• FY17 gross profit increased by 259% to A$218m

• Dofetilide became largest selling generic product

• Teva acquired products delivered revenue of US$180m and EBITDA of US$90m

• Accelerated price deflation in the second half impacting gross profit margin

==> picture [313 x 239] intentionally omitted <==

==> picture [90 x 90] intentionally omitted <==

----- Start of picture text -----

4
----- End of picture text -----

Specialty Brands Division (SBD)

• FY17 revenue down 20% to A$62m

• FY17 gross profit down 20% to A$59m

• Impacted by loss of exclusivity on Doryx® 50mg and 200mg tablets in May 2016

• Stronger performance in 2H17 driven by launch of Fabior® and Sorilux® in January 2017

• Both Fabior® and Sorilux® exceeded the previous peak prescription volumes under the former brand owner

==> picture [359 x 245] intentionally omitted <==

• Doubling dermatology field sales force in FY18

==> picture [90 x 90] intentionally omitted <==

----- Start of picture text -----

5
----- End of picture text -----

Metrics Contract Services (MCS)

• FY17 revenue up 18% to A$58m

New fluid bed spray coater and stability centre

• FY17 gross profit up 22% to A$32m

• Growing customer demand for end to end solutions

• Greenville facility expansions and investment in new technical equipment attracting higher value and commercial contract manufacturing business

==> picture [168 x 245] intentionally omitted <==

==> picture [211 x 243] intentionally omitted <==

==> picture [90 x 90] intentionally omitted <==

----- Start of picture text -----

6
----- End of picture text -----

Mayne Pharma International (MPI)

• FY17 revenue up 2% to A$34m

• FY17 gross profit down 13% to A$7m

• Australian sales benefited from sales growth in Lozanoc® and oxycodone; offset by softer Kapanol® and injectable sales

• Gross profit decline reflects reduced one-off licensing fee income and international Kapanol® royalties

==> picture [369 x 239] intentionally omitted <==

• Australia - Urorec® launched and Monurol® launching in FY18

==> picture [90 x 90] intentionally omitted <==

----- Start of picture text -----

7
----- End of picture text -----

Greenville campus – nearing completion

==> picture [563 x 425] intentionally omitted <==

Year to date October trading

• Revenue down 12% to A$151m impacted by generic competitive pricing pressures, abnormal Doryx® returns and lower SBD trade volumes

• Gross profit impacted by abnormal Doryx® returns and also one-off extraordinary stock obsolescence in GPD

• ─ Gross profit margin 41%

• ─ Adjusted gross profit margin 50%[1]

• GPD revenue down 10% on pcp to US$88m

• MCS revenue up 7% on pcp to US$15m

• MPI revenue up 12% on pcp to A$13m

• SBD revenue down 48% on pcp to US$6m

• ─ Adjusted revenue up 8% excluding abnormal Doryx® returns

==> picture [90 x 90] intentionally omitted <==

----- Start of picture text -----

9
----- End of picture text -----

(1) Adjusted gross profit excludes one-off items of (i) A$8.9m abnormal stock obsolescence which is calculated as the amount above standard industry rates of obsolescence and (ii) A$7.6m of Doryx® returns emanating from the generic event on legacy Doryx 50mg and 200mg tablets

SUBA-Itraconazole franchise has multiple opportunities for growth

Anti-fungal

Oncology

• Approved in Australia, Spain, Germany, UK, Italy, Portugal, Belgium and Austria

• Marketed by Mayne Pharma in Australia and ISDIN in Germany and Spain

• Partnered with the US listed HedgePath Pharmaceuticals Inc. (OTCQX: HPPI) to pursue the clinical development, registration and commercialisation of SUBA®-Itraconazole in anticancer applications

• Out-licensed in 15 countries around the world and expect to launch in Argentina, Austria, Belgium, Columbia, Italy, Mexico and Portugal over the coming year

• Mayne Pharma owns 50%+ of HPPI

• FDA and EMA granted Orphan Drug Designation for BCCNS

• Expected to file in the US in FY18

• Ongoing US Phase IIb multi-centre clinical trial

• US market potential: US$200m

• US market potential: US$300m for BCCNS

==> picture [90 x 90] intentionally omitted <==

----- Start of picture text -----

10
----- End of picture text -----

Phase IIb study in BCCNS patients

● 38 patients treated to date

• ─ 10 patients in active treatment

• ─ 10 patients in follow up

• ─ 18 patients off study

● 195 BCC excisions per patient prior to the study

• Only one surgery for a BCC target lesion while on study

● Target lesion (TL) response rates[1]

• ─ All target lesions (N=477) 53.7%

==> picture [31 x 227] intentionally omitted <==

----- Start of picture text -----

100%
75%
50%
25%
0%
-25%
-50%
-75%
-100%
% change from BL
----- End of picture text -----

==> picture [272 x 221] intentionally omitted <==

Target lesions

• ─ Serious TLs (N=90) 55.6%

• ─ Other TLs (N=387) 53.2%

==> picture [90 x 90] intentionally omitted <==

----- Start of picture text -----

11
----- End of picture text -----

(1) Response defined as ≥ 30% size reduction from baseline (BL). Serious TLs defined as ≥ 6mm on the face or >20mm elsewhere

Phase IIb study in BCCNS patients (cont.)

• Median time on study 38 weeks

• Up to 90 weeks on study for some patients

• Very good safety profile with

• only 11% of patients discontinued due to adverse events

• No hair loss

• No loss of taste

• No severe muscle spasms

==> picture [311 x 298] intentionally omitted <==

Durable response for 256 responding target lesions with limited side-effects

==> picture [90 x 90] intentionally omitted <==

----- Start of picture text -----

12
----- End of picture text -----