SPT — Interim / Quarterly Report 2017

Nov 6, 2017

Ticker: TWSE 1789

Third Quarter 2017 On-Line Investor Meeting

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November 06, 2017

Disclaimer

This material has been prepared by ScinoPharm Taiwan, Ltd. (“ScinoPharm”).

Any opinions expressed in this material are subject to change without notice as a result of using different assumptions. ScinoPharm is under no obligation to update or keep current the information contained herein.

The information contained in this presentation is ScinoPharm’s confidential information. Any disclosure, copying, distribution or any action taken or omitted to be taken in reliance on it is prohibited and may be unlawful.

No representation or warranty , express or implied, is or will be made in or in relation to, and no responsibility or liability is or will be accepted by the Company as to , the accuracy or completeness of this material and any liability therefore is hereby expressly disclaimed.

Statements made in this presentation include forward-looking statements, which include, without limitation, statements about the issues, plans and expectations of ScinoPharm. Without limiting the foregoing, statements including the words “believes”, “anticipates”, “plans”, “expects” and similar expressions are also forward-looking statements. Forward-looking statements reflect, among other things, management’s plans and objectives for future operations, current views with respect to future events and future economic performances and projections of various financial items. These forward-looking statements involve known and unknown risks , uncertainties and other factors which may cause actual results to differ materially from those implied by such forward-looking statements.

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Table of Contents

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� Overall Updates of ScinoPharm

� Financial & Operating Results in 3Q, 2017

• Trends in US Generic Pharma

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Overall Updates of ScinoPharm

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Confidential

Business Overview

• Company specializes in high potency (steroid/cytotoxic) APIs and is expanding into sterile/aseptic injectable formulations

• Facility & organization established in Taiwan and expanding in China with a new GMP plant in Changshu & marketing base in Shanghai

• 73 generic APIs in current portfolio with 25 APIs launched; 55 US DMFs filed (764 DMFs WW), 33 US DMFs in oncology APIs. 100+ NCE CRAM projects, with 6 APIs launched and 4 in phase III for NDA filing in 1-3 years

• Fully compliant with world-class cGMPs and international regulatory requirements; Certified by US FDA, EMA, EDQM, Australian TGA, Japanese PMDA

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Driving Long Term Growth by Dual Profits

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Recap of Performances and Major Events

• Reported the consolidated revenues for 3Q17 were NT$849 million, net profits after-tax were NT$ 107 million, gross margin was 48%, EPS was NT$0.14

• The performances were mainly suffered by the unfavorable sales volumes and product mix of generic products in 3Q. However, CRAM business started to gain momentum and contributed to gross margin

• Passed Mexican healthy authority(COFEPRIS) inspection in Taiwan

• Passed Jiangsu FDA inspection in Changshu site

• On schedule to complete equipment assembly & verification in inhouse injectable plant. Planned to kick-off registration batch production for prefilled syringe by early 2018

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Financial & Operating Results 3Q, 2017

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Quarterly P&L - Consolidated

In NT$ million, except for EPS	3Q,’17 (Reviewed)	3Q,’17 (Reviewed)	2Q,’17 (Reviewed)	2Q,’17 (Reviewed)	3Q,’16 (Reviewed)	3Q,’16 (Reviewed)	QoQ	YoY
Operating Revenue	849		853		992		-1%	-14%
Gross Profit	407		326		466		25%	-13%
Gross margin	48%		38%		47%
Operating Expenses	(256)		(239)		(233)		-7%	-10%
Operating Income	152		86		233		75%	-35%
Operating margin	18%		10%		24%
Other Rev.(Exp.)	(25)		(7)		(27)		-252%	7%
Net Income before Tax	127		79		207		60%	-39%
Net Income after Tax	107		84		166		27%	-35%
Net margin after tax	13%		10%		17%
EPS (after tax)	0.14		0.11		0.21

Cumulative P&L - Consolidated

In NT$ million, except for EPS	1Q~3Q,’17 (Reviewed)	1Q~3Q,’17 (Reviewed)	1Q~3Q,’16 (Reviewed)	1Q~3Q,’16 (Reviewed)	YoY	YoY
Operating Revenue	2,621		3,028		-13%
Gross Profit	1,203		1,362		-12%
Gross margin	46%		45%
Operating Expenses	(744)		(704)		-6%
Operating Income	459		658		-30%
Operating margin	17%		22%
Other Rev.(Exp.)	(61)		(60)		-1%
Net Income before Tax	398		598		-33%
Net Income after Tax	362		512		-29%
Net margin after tax	14%		17%
EPS (after tax)	0.46		0.65

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Balance Sheet - Consolidated

In NT$ million	2017/09/30 (Reviewed)	2017/09/30 (Reviewed)	2016/09/30 (Reviewed)	2016/09/30 (Reviewed)
Cash and Cash Equivalents	3,950	31%	3,137	25%
Accounts Receivable	470	4%	614	5%
Inventories	1,830	14%	2,018	16%
Long-Term Investments	391	3%	364	3%
Property, plant and equipment	5,122	40%	5,248	42%
Other Current/Non-Current Assets	1,107	8%	1,128	9%
Total Assets	12,870	100%	12,509	100%
Current Liabilities	1,219	10%	1,534	12%
L-T Liabilities and Others	1,300	10%	880	7%
Stockholders’ Equities	10,351	80%	10,095	81%

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Cash Flows - Consolidated

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1Q~3Q 2017 1Q~3Q 2016
In NT$ million
(Reviewed) (Reviewed)
Cash and cash equivalents at
3,707 2,336
beginning of period
Cash flows from operating activities 789 1,130
CAPEX (383) (420)
Short-term borrowings (405) (747)
Long-term borrowings 570 812
Cash Dividends (228) (219)
Others (100) 245
Cash and cash equivalents at
3,950 3,137
end of period
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Sales by Business

2017 Q1-Q3

BD & Others CMO 6% 2016 Q1-Q3 13% BD & CMO CRO Others CRO 2% 8% 1% 5% Generics

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Sales by Indication

2017 Q1-Q3

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Others
21%
CNS
2016 Q1-Q3 10%
Oncology
Others 69%
10%
CNS
13%
Oncology
Oncology60%
77%
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Sales by Region

2017 Q1-Q3

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ChinaROW
2016 Q1-Q3 JP
2% 9%
8%
India
JP China 9%
ROW
US+CAN
8% <1%
10%
EU 38%
India
34%
9%
US+CAN
EU
52%
21%
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Trends in US Generic Pharma

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Confidential

Trends in US Generic Pharma

• More Consolidation

• More Competition & Price Erosion on Commodity Generics

• More Focus on Complex Generics

• More Focus on New Therapeutics Agents via 505(b)2

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More Consolidation

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Consolidation of US Drug Buyers

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Others Others
WBA+
WBAD+
10% 10%
ABC+
ESRX+
ESRX
Econdisc RAD
Econdisc
15% Y2015 30%
Y2017 45%
MCK+
Generic
WMT
Generic
Market (ClarusOne)
20%
Market
MCK
20% CVS+CAH
CVS+ CAH
25%
(Red Oak)
25%
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WBAD: Walgreen Boots Alliance Development & AmerisourceBergen CVS/CAH: CVS & Cardinal Health MCK/WMT: McKesson & Walmart

Source: Morgan Stanley Research

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Confidential

Classification of Complex Generics

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Complex Generics
Complex Drug-
Complex
Complex Complex Route
Device
Formulations
APIs of Delivery
Combination
Non- Biologic
Biological
Complex Drug
(Biosimilars)
(NBCD)
Source: Market Realist
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Confidential

Complex Generic Opportunity

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Total US Market Size Generics Volume Share
250 90%
80%
200 80%
70%
218
60%
150 61%
50%
52%
46% 40%
100
40%
138 37% 30%
25% 20%
50
8% 24
10%
9 15 6
2
30
USD bn 0 0%
Source: IMS, 2017 21
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Source: IMS, 2017
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New Therapeutics Agents via 505(b)2

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NOVEL
Formulation
or combo’s
New
Known
NOVEL
Unmet Molecules Therapeutic
Delivery
Need
(branded/ Entity，NTE
generic)
NOVEL
Indication
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NTEs- Shorter Timeline & Lower Cost

NCE(New Chemical Entity) process= 10-15 years, USD1-2B

PreClinical

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Phase 1
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Phase 2

Phase 3 Submission

NTE(New Therapeutic Entity) process= 3-6 years, USD10-50M

• 505(b)2 pathway in US

• Referencing safety & efficacy data of original molecule

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Pre-Clinical Phase 1
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Phase 3
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Submission
505(b)2
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ScinoPharm Opportunities

• Partnership with marketers in different territories

• Baxter and others

- China Collaboration for US & China dual submissions

• Build a Portfolio of Injectable ANDAs

- Internal development and/or external collaboration; 2ANDAs submitted Acquiring injectable ANDAs

• Focus on Complex Generics

• Complex API, oncology injectable & combination product - Long-acting injectables

• Focus on New Therapeutic Agents (NTE) via 505(b)2

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2017 Product Launch Plan

Type Product Region Indication Brand Marketer Regional Sales WW Sales	Type Product Region Indication Brand Marketer Regional Sales WW Sales	Type Product Region Indication Brand Marketer Regional Sales WW Sales	Type Product Region Indication Brand Marketer Regional Sales WW Sales	Type Product Region Indication Brand Marketer Regional Sales WW Sales	Type Product Region Indication Brand Marketer Regional Sales WW Sales	Type Product Region Indication Brand Marketer Regional Sales WW Sales	Type Product Region Indication Brand Marketer Regional Sales WW Sales	Type Product Region Indication Brand Marketer Regional Sales WW Sales
	Type	Product	Region	Indication	Brand Marketer	Regional Sales	WW Sales
	Generic API	Desmopressin Acetate	USA	Polyuria	Ferring	US$166M	US$405M
	Generic API	Tamsulosin HCl	USA	Benign Prostatic Hyperplasia (BPH)	Boehringer Ingelheim	US$333M	US$1706M
	New Drug API	Oncology Product	US	Non-Small Cell Lung Cancer	N/A	N/A	N/A
	New Drug API	Baxdela™	USA EU	Antibiotics	N/A	N/A	N/A
Generic Drug Oncology Injectable US Myeloid Leukemia MDS US$183M US$278M	Generic Drug	Oncology Injectable	US	Myeloid Leukemia	MDS	US$183M	US$278M

Launched Source: IMS Data (2015Q3-2016Q2)

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uestions Q

& Answers

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Brand Quality with Asian Advantages www.scinopharm.com

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