SPT — Interim / Quarterly Report 2017

Oct 30, 2017

Ticker: TWSE 1789

First Quarter 2017 On-Line Investor Meeting

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May 08, 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 Q1, 2017

• Business Updates

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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

• 72 generic APIs in current portfolio with 25 APIs launched; 53 US DMFs filed (759 DMFs WW), 32 US DMFs in oncology APIs. 100+ NCE CRAM projects, with 5 APIs launched and 5 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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Recap of Performances and Major Events

• Reported the consolidated revenues for 1Q17 were NT$919 million, net profits after-tax were NT$ 170 million, gross margin was 51%, EPS was NT$0.22

• The revenues was suffered by the stronger-than-expected appreciation of the NT dollar against the US dollar. However, the impact was offset by tighter cost control and process optimization

• Building exclusive strategic partnership with Baxter for generic oncology injectables

• Taiwan site completed the 6[th] times US FDA inspection with no resulting 483 concerns

• On schedule to carry out equipment assembly and installation for both cartridge and vial production lines, followed by verification and cGMP system deployment

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Financial & Operating Results Q1, 2017

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Quarterly P&L - Consolidated

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Q1, 2017 Q1, 2016
In NT$ million, except for EPS YoY
(Reviewed) (Reviewed)
Operating Revenue ＊ 919 1,022 -10%
Gross Profit 470 431 9%
Gross margin 51% 42%
Operating Expenses (249) (236) 6%
Operating Income 221 195 13%
Operating margin 24% 19%
Other Rev. (Exp.) (29) (4)
Net Income before Tax 192 191 1%
Net Income after Tax 170 172 -1%
Net margin after tax 19% 17%
EPS (after tax) 0.22 0.23
＊
Taiwan New Dollar per 1 US Dollar quarterly average:
2017Q1: 30.93, 2016Q1: 33.16
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Balance Sheet- Consolidated

In NT$ million	2017/03/31 (Reviewed)	2017/03/31 (Reviewed)	2016/03/31 (Reviewed)	2016/03/31 (Reviewed)
Cash and Cash Equivalents	3,715	29%	2,560	21%
Accounts Receivable	635	5%	645	5%
Inventories	1,941	15%	2,167	17%
Long-Term Investments	364	3%	364	3%
Property, Plant & Equipment	5,155	40%	5,361	43%
Other Current/Non-Current Assets	1,043	8%	1,394	11%
Total Assets	12,853	100%	12,491	100%
Current Liabilities	1,692	13%	2,374	19%
Long-Term & Other Liabilities	803	6%	90	1%
Stockholders’ Equities	10,358	81%	10027	80%
			,

Cash Flows- Consolidated

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Q1, 2017 Q1, 2016
In NT$ million
(Reviewed) (Reviewed)
Cash and cash equivalents
3,707 2,336
at beginning of period
Cash flows from operating activities 304 663
CAPEX (203) (264)
Short-term borrowings (51) (16)
-
Long-term borrowings (41)
Others (1) (159)
Cash and cash equivalents
3,715 2,560
at end of period
Free Cash flow 101 399
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Sales by Business

2017 Q1

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BD&
CMO other
2016 Q1
8% 6%
CRO
5%
CMO BD
CRO
1% 1%
6%
Generics
81%
Generics
92%
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Sales by Indications

2017 Q1

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Others
12%
2016 Q1 CNS
11%
Others
Oncology
CNS 14%
77%
11%
Oncology
75%
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Sales by Region

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2016 Q1
CN ROW
JP
<1% 10%
8%
India
3%
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2017 Q1

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JP
CN ROW
8%
2% 5%
India
5%
US+CAN
EU
44%
36%
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Business Updates

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Confidential

Injectable Products Allied with Baxter

• ScinoPharm and Baxter Healthcare establish worldwide partnerships to co-develop and commercialize five niche generic injectable products at the initial stage

• ScinoPharm develops all APIs and injectable formulations. Baxter leads regulatory submissions in the US/EU and eventually market & sell the injectable products via its extensive presence in the hospital channel

• Both parties work on a cost-and-profit-sharing collaboration model

• Baxter has the right to add up to 15 additional injectables products for collaboration with ScinoPharm

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Confidential

Collaboration Framework

• Initial product portfolio including the generic injectables for breast cancer, lung cancer, multiple myeloma and antinauseant. Targeting US/EU markets first and expect to expand to other territories

• This exclusive partnership will utilize each other's strengths and expertise in order to achieve large scale of synergies in providing niche and affordable generic injectable products

• Commercial launch for the first 5 products upon FDA approval, with product launches beginning in 2020 and continuing thereafter

• Current branded sales of the initial five products included in this partnership total more than $4 billion annually

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Marketing Territory

• All countries throughout the world, excluding China and Taiwan

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Responsibilities by ScinoPharm and Baxter

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API Development
API Production
ScinoPharm
Formulation
Development
ScinoPharm
FDF Baxter
Manufacturing
CMO
Sales &
Baxter
Marketing
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FDF: Finished Dosage Form
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Confidential

Benefits of the Collaboration

• Aggressively expanding our “Double A” strategy for inhouse developed/produced APIs and formulations. Providing an outlet for our injectable plant capacity

• A win-win solution and collaboration. ScinoPharm provides comprehensive APIs and formulation portfolio, while Baxter operates strong injectable product marketing channels throughout the US and worldwide

• Accelerate the momentum of our downstream integration strategy by establishing alliance with an world-renowned partner

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Strategic Alliance Highlights

*** Already launched**

Strategic Alliance Highlights * Already launched	Strategic Alliance Highlights * Already launched	Strategic Alliance Highlights * Already launched	Strategic Alliance Highlights * Already launched	Strategic Alliance Highlights * Already launched	Strategic Alliance Highlights * Already launched	Strategic Alliance Highlights * Already launched	Strategic Alliance Highlights * Already launched
Partner Product Indications Region Launch Year(E) Remarks Genovate Entecavir Hepatitis B Virus Taiwan 2013 1st co-developed formulation product launch Sagent Oncology Myeloid US 2017 1st US ANDA filing, triggering US FDA inspection*
	Partner	Product	Indications	Region	Launch Year(E)	Remarks
	Genovate	Entecavir	Hepatitis B Virus	Taiwan	2013*	1st co-developed formulation product launch
	Sagent	Oncology	Myeloid	US	2017	1st US ANDA filing, triggering US FDA inspection
		Injectable	Leukemia			in Changshu, China site
	Foresee	Leuprolide	Prostate cancer	US	2019	505(b)(2) NDA CRAM + Equity
	Coland	Bortezomib	Multiple Myeloma	China	2020	1st co-developed drug in China to trigger CFDA inspection in Changshu site
		Azacitidine	MDS	China	2021	Co-developed formulation in China
	Lee’s Pharma	Fondaparinux	Anti-thrombotic	China	2021	Co-development collaboration
		Travoprost	Glaucoma	China	2021
		&Bimatoprost
	Nanjing King Friend	Regadenoson	Stress agent for heart scan	China	2020	Co-developed formulation in China
	US partner	Project A	Non-small cell lung cancer	US	2017	US NDA 505(b)(2) / The estimated launch year is subject to US FDA review
	US & China	Project B	Imaging agent	US	2021	ANDA with Paragraph IV filing / The estimated launch year is subject to
partners litigation results Baxter 5 niche injectables Anti-cancer & antinauseant US/EU 2020& continuing thereafter Baxter has the right to add up to 15 additional injectable products for collaboration Indian Int’l partner Niche injectable Anti-thrombotic US/EU 2018 1st self-developed US ANDA launched. Executive right for marketing & sales 20	partners					litigation results
	Baxter	5 niche injectables	Anti-cancer & antinauseant	US/EU	2020& continuing thereafter	Baxter has the right to add up to 15 additional injectable products for collaboration
	Indian Int’l partner	Niche injectable	Anti-thrombotic	US/EU	2018	1st self-developed US ANDA launched. Executive right for marketing & sales

Confidential

CRO Phase III Product Portfolio

*** Already Filed**

Code Est. NDA Indication Sales Region Production Site	Code Est. NDA Indication Sales Region Production Site	Code Est. NDA Indication Sales Region Production Site	Code Est. NDA Indication Sales Region Production Site	Code Est. NDA Indication Sales Region Production Site	Code Est. NDA Indication Sales Region Production Site	Code Est. NDA Indication Sales Region Production Site
	Code	Est. NDA	Indication	Sales Region	Production Site
		Filing Year
	A	2016*	Infectious Disease	US / EU / Asia	Taiwan
	B	2018	Type I,II Diabetes	US/ EU	Changshu (Intermediate)
	C	2018	Advanced Hepatocellular Carcinoma/ Myelofibrosis/ Autoimmune disease, etc.	CN	Changshu
	D	2018	Prostate Cancer	US / EU	Taiwan
E 2018 Parkinson’s Disease US Taiwan	E	2018	Parkinson’s Disease	US	Taiwan

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2017 Product Launch Plan

Type Product Region Indication Brand Regional WW	Type Product Region Indication Brand Regional WW	Type Product Region Indication Brand Regional WW	Type Product Region Indication Brand Regional WW	Type Product Region Indication Brand Regional WW	Type Product Region Indication Brand Regional WW	Type Product Region Indication Brand Regional WW	Type Product Region Indication Brand Regional WW	Type Product Region Indication Brand Regional WW
	Type	Product	Region	Indication	Brand	Regional	WW
					Marketer	Sales	Sales
	Generic API	Desmopressin Acetate	USA	Polyuria	Ferring	US$166M	US$405M
	Generic	Tamsulosin HCl	USA	Benign Prostatic	Boehringer	US$333M	US$1706M
	API			Hyperplasia (BPH)	Ingelheim
	CMO API	Oral Product	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

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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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