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LOTUS BUILDING A PAN-REGIONAL LEADER
May 2015
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Safe Harbor Statement
Except for historical information contained herein, the matters set forth in this presentation are forward
looking statements that are subject to risks and uncertainties that could cause actual results to differ
materially. These forward looking statements are not based on historical facts but rather on
management’s expectations regarding future growth, results of operations, performance, future capital
and other expenditures, competitive advantages, business prospects and opportunities. Statements in
this presentation about our future plans and intentions, results, level of activities, performance, goals or
achievements or other future events constitute forward looking statements. Wherever possible, words
such as “anticipate”, “believe”, “expect”, “may”, “could”, “will”, “potential”, “intend”, “estimate”, “should”,
“plan”, “predict”, or the negative or other variations of statements reflect management’s current beliefs
and assumptions and are based on the information currently available to our management. Investors
are cautioned not to place undue reliance on these forward looking statements, which are made
as of the date of this presentation and we assume no obligation to update or revise any forward
looking statements.
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COMPANY OVERVIEW
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COMPANY OVERVIEW
• Research-based company focused on innovative development
of difficult to make generic pharmaceuticals
• 63.4% owned by Alvogen, a specialty pharmaceutical company
with global presence, focusing on developing, manufacturing
and marketing of generic and OTC pharmaceuticals, as well as
biosimilars
• #1 in Korea in terms of sales from anti-obesity drug, and strong
presence in Taiwan for oncology and CNS generic drugs
• Current product portfolio comprises 250+ marketed products
• Robust pipeline focusing on oral oncology, high potency, and
soft gel drugs
• Experienced in-house sales team with a strong emphasis on
marketing, covering ~10,000 clinics, hospitals and pharmacies /
drugstores in Asia Pacific
• 1 US FDA, EU EMA, and Japan PMDA approved manufacturing
facility, 2 KGMP approved manufacturing facilities and R&D
centers with 140+ generic drug submissions for past 4 years
Pioneer in the Asia Pacific
Generic Pharmaceutical Industry
• Robust international pipeline:
– 8 products for Japan in pipeline
– 4 products for EU Asia scope in pipeline
– 9 products filed in China
– 10 products in pipeline / filed ANDA for US
Strong Pipeline
Market Leader in the Highly Attractive Asia Pacific Generic Pharmaceutical Industry
Strong Growth and Margin
20141
1,191
(31)
52 %
Gross Profit
Net Profit
Gross Margin
Revenue 2,310
NT$ MM
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39
(1)
52 %
75
US$ MM2
1 Normalized numbers. Please refer to p. 20 for details of normalization
2 Based on USD / TWD FX rate of 30.918.
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COMPANY OVERVIEW
Lotus History and Key Milestones
1966
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Manufacturing
Facility Obtained
Japan PMDA
Approval
Lotus Acquired
Dream Pharma
Founded in 1966
Manufacturing
Facility Obtained
US FDA Approval
First Product
Launch in the
US
Manufacturing Facility
Obtained EU EMA
Approval
First Product
Launch in Japan
US FDA
Compliance
Inspection Passed
Alvogen Became a Majority Shareholder of Lotus
Lotus Acquired Alvogen’s Korea, Taiwan and India Businesses
Aug 11 Dec 19
EU EMA
Compliance
Inspection Passed
Listed in GreTai
Stock Exchange
(1795.TT)
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COMPANY OVERVIEW
Shareholding Structure
Note: as of March 31, 2015 Page I 6
Alvogen Asia Pacific
Holdings Ltd.
63.4%
Lotus Pharmaceutical
Co., Ltd.
(Taiwan)
Alvogen Taiwan
(Taiwan)
100.0% 100.0%
100.0%
100.0%
Lotus Tab, Ltd
(UK)
Lotus Pharmaceutical,
HK Inc.
(HK)
美喬生技有限公司
(Taiwan)
100.0%
Alvogen Korea Ltd.
(Korea)
Kunwha
Pharmaceutical Co.,
Ltd.
(Korea)
Dream Pharmaceutical
Co., Ltd.
(Korea)
100.0%
82.5% 100.0%
98.0%
Alvogen Pharma India
Pvt Ltd.
(India)
Norwich Clinical
Services Pvt Ltd.
(India)
100.0%
100.0%
樂特仕生物科技諮詢
(上海)有限公司
(China)
Lotus International Pte.
Ltd.
(Singapore)
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COMPANY OVERVIEW
Lotus and Alvogen Joining Forces
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• Well-established market leadership
in Taiwan and Korea, high entry
barriers countries for multinational
firms
• State-of-the-art manufacturing
facility approved by US FDA, EU
EMA, and Japan PMDA, accessible
to highly regulated markets
• Strong pipeline and capabilities in
difficult-to-make generics focusing
on oral oncology, high potency, and
soft gel
• Solid management team with
extensive industry experience as
well as in-depth knowledge from
multinational background
• Strong sales and profit growth
since Company’s inception with
sales and marketing network in
more than 30 countries
• Solid US regulatory and IP
capabilities
• Robust pipeline of more than 300
products globally
• Proven track record in M&A
execution
Asia Pacific Hub with Dominant Market
Leadership for Alvogen
Global platform with unparalleled market
potential for Lotus
The combination of Lotus’ strategically important foothold in Taiwan and Korea markets and its growing US/
Japan/ China product pipeline and Alvogen’s strong geographic coverage in the US, Central and Eastern
Europe and Asia is expected to generate significant opportunities to drive revenue growth, margin
enhancement, and create further value for the two companies
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INVESTMENT HIGHLIGHTS
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INVESTMENT HIGHLIGHTS
Investment Highlights
1 Well-positioned in Highly Attractive and Fast Growth Markets
2 Strong Sales Forces and Distribution Channels in Key Markets
3 High Growth via Organic Growth and Strategic M&As
4 Strong R&D and Solid Manufacturing Capabilities Delivering Top Quality
Drugs
5 Broad Pipeline that Delivers Sustainable Growth
6 Solid Integration Capabilities and Management Team that Extract
Synergies and Generate Value
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INVESTMENT HIGHLIGHTS
Well-positioned in Highly Attractive and Fast Growth Markets in Asia…
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Pharma Market Size
(US$bn)
5yr CAGR
(%)
2.1%
9.9%
11.6%
3.7%
9.2%
7.1%
7.3%
5.2%
13.9%
11.5%
9.2%
8.0%
7.6%
• Well-established presence in key markets of North Asia where
strong growing economies, fast aging populations, high cultural
and other entry barriers for multinational firms
• Strong market leadership in Korea and Taiwan
• #1 in Korea in terms of sales from anti-obesity drug
• Solid track record in Taiwan for oncology and CNS generics
Strong Presence in Korea and Taiwan
• Well-planned strategies for access to Japan and China
• 8 products for Japan in pipeline
• 9 products filed in China
• Leveraging existing production capabilities and commercial
network through Alvogen’s platforms to further penetrate fast
growing markets in South East Asia
• Aiming to tap into complementary markets in terms of product
portfolio where mostly self-pay to fuel future growth
Well-positioned to tap into other Asian markets
Source: BMI Research
0.8
1.6
2.0
2.2
3.3
3.8
4.5
5.5
5.9
15.8
16.7
98.8
107.0
Singapore
Hong Kong
Bangladesh
Malaysia
Vietnam
Philippines
Thailand
Taiwan
Indonesia
Korea
India
China
Japan
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INVESTMENT HIGHLIGHTS
… As Well As US with Strong Sales Forces and Distribution Channels
Solid Market
Position
• Well recognized by clinics, hospitals and pharmacies / drugstores
• Effectively market and sell existing products and new products
• Foundation for cross-selling products targeting fast-growing / core therapeutic areas
Strong Brand
Recognition
Taiwan
South
Korea
UK
Shanghai
Indian
US
- Direct access with strong pipeline leveraging
US FDA approved manufacturing facility
- 10 products in pipeline/ filed ANDA in
the US
- Product launch through Alvogen’s existing
sales forces or partnership
• Covering a network of ~10,000 clinics, hospitals and pharmacies / drugstores with internal sales force in key markets
• Experienced sales force with product expertise
• Strong management team with executives and regional managers who have years of experience in the pharmaceutical industry
Presence Access
Headquarter Branch Offices
Partnership
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INVESTMENT HIGHLIGHTS
• Double digit growth per year
• Aggressive product launches across the APAC region – 26 products selected and roll out started into Korea and other Asian
markets
• Gain further market share in existing and new markets
Organic Growth
High Growth via Organic Growth and Strategic M&As
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M&A Strategies
• Alvogen, Lotus’ majority shareholder with robust M&A track record, is committed to supporting Lotus for
future growth to achieve its target to become leading generic pharmaceutical player in APAC
• Solidify our leadership position in Asia Pacific generic pharmaceutical market and capture opportunities
ahead of industry consolidation in the region
• Strengthen product portfolio in our focused therapeutic areas
– Acquire or invest in companies with generic pharmaceutical products or candidates that complement
our existing product portfolio
Selection
Criteria
• Targets with strong generic drug submission capabilities or attractive products / candidates
• Targets’ products need to have strong market potential, potential synergies, and minimal overlap with
existing product portfolio or pipeline
• Opportunities with restructuring opportunities (balance sheet management, non core asset disposal
opportunities)
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INVESTMENT HIGHLIGHTS
• In-house R&D capabilities
• Collaboration with industry leading
companies and research institutions
• Systematically acquires and integrates
targets with solid development and
commercialization track record
Strong Development Capability
• Integrated capabilities spanning a wide-
range of therapeutic areas:
– Strategically focus on oral oncology,
high potency, and soft gel drugs
• Solid contract research organization in
India:
– Facilitates oncology studies
– Quick patient enrollment
Integrated R&D Platform
Integrated R&D
Capabilities with a
proven track record
of successful
innovations
• US FDA, EU EMA and Japan PMDA
approved production facilities focusing
on high potency and cytotoxic products
• Provides oncology contract manufacturing
organization services to Japanese
pharmaceutical companies
• Analytic process development for quality
control and assurance
Multiple Manufacturing Platforms
Strong R&D and Solid Manufacturing Capabilities Delivering Top
Quality Drugs
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INVESTMENT HIGHLIGHTS
Broad Pipeline that Delivers Sustainable Growth
Note: As of April 2015
Source of originator’s sales: IMS data Page I 14
Biosimilars
• Lotus and Alvogen/AlvoTech signed distribution agreements for two key biosimilars currently under
development by AlvoTech.
• Lotus will market and distribute these biosimilars in the following APAC markets: Taiwan, China, Vietnam,
South Korea, Thailand, Hong Kong, Philippines, Malaysia, Indonesia, Singapore and Myanmar
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INVESTMENT HIGHLIGHTS
Solid Integration Capabilities and Management Team that Extract Synergies and Generate Value…
Extensive Experience
Senior management team has comprehensive
experience up to 20 years in the pharmaceutical
industries
In-depth Knowledge
Many have worked with leading global
pharmaceutical companies. They bring extensive
M&A and industry experience and in-depth
knowledge
Diversified Exptertise
Experience and expertise range from research
and development to manufacturing, sales,
marketing and distribution
Dr. Jon Valgeirsson, VP of R&D APAC
Dr. Saral Thangam, CEO Norwich Clinical Services (CRO India)
Jade Lee, Regional HR Director
Sunny Chen, Regional Supply Chain Manager
Dr. Chung R. Kim, Regional Quality Director
Renaat Janssen CEO Lotus Previously Executive Director at PPD with more than 20 years experience in pharma industry
Siegfried Gschliesser Deputy CEO Lotus and GM Taiwan Joined Alvogen in 2010 as regional head of Business development and the country manager for Taiwan
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David Young Regional CFO Previously CFO of SemiLEDs Corporation, (NASDAQ: LEDS), VP of sourcing, accounting and finance at Payless Shoesource, formally NYSE company
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INVESTMENT HIGHLIGHTS
… With Strong Support from Board of Directors
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Charles Lin Chairman of BOD • Founder of Lotus and has more than 30
years in pharmaceutical industry • Leads Lotus as a R&D-based Taiwanese
company with manufacturing facilities approved by global FDAs
Robert Wessman Director • Chairman and CEO of Alvogen Group • Has grown Alvogen from a small US
business into an international pharma with commercial operations in 34 countries and with 2,000 employees within 5 years
Independent Directors
Benjamin Ku Partner at Cheng & Ku Law firm
Hui Wen Cheng Professor at Taipei Medical University
Hjorleifur Palsson Previous EVP and CFO at Ossur hf., a listed company at NASDAQ OMX Copenhagen
Directors
Arni Hardarson Chief Legal Counsel, Alvogen
Kevin Bain CFO, Alvogen
Thor Kristjansson EVP M&A, Alvogen
Le Hong VP, Lotus
• Combined efforts from Lotus founding team as well as strong commitment from Alvogen Group with
seamless cooperation
• Nine distinguished members with an exceptional knowledge and experience in the related fields to
guide the Company in all aspects
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GROWTH STRATEGIES
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Unlock Value Through Realizing M&A Synergies
STRATEGIES
Lotus is Committed to Delivering Value-Driven Medicine
Further Develop Asia Pacific and US Generic Pharmaceutical Markets
Expand Product Portfolio through Strategic M&A
Expand Our Network of Sales and Marketing Personnel to
Further Promote Our Products
Strong Support From Majority Shareholder - Alvogen
2
3
5
6
1
4
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FINANCIAL HIGHLIGHTS
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FINANCIAL HIGHLIGHTS
FY2014 Results Update
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Major adjustments include 1) costs related to early retirement programs of Kunwha for integration with Dream Pharma’s
integrations of NT$266 million; 2) post-acquisition special bonus to Lotus’ employees of NT$12 million; 3) M&A-related
costs including professional fees and transaction taxes of NT$39 million; 4) financial costs and losses related to the early
redemption of Alvogen Korea’s CB of NT$113 million
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FINANCIAL HIGHLIGHTS
2015 YTD Monthly Sales Update
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2014 2015
49 37 44
52
435 432 429 448
Jan Feb Mar Apr
• Robust January sales as the merger between Lotus and
Alvogen’s key operations in Asia has been completed in
2014 with closing of Kunwha’s acquisition of Dream
Pharma in December
• Contribution from Korean subsidiaries helped Lotus
deliver a solid result in February of maintaining sales at a
similar level with January sales despite both the Chinese
New Year holidays in Taiwan and Korea
• Due to a substantial depreciation in the Korean Won
against the New Taiwan Dollar from February to March,
Lotus March consolidated sales in NT dollars slightly
decreased. Excluding the FX impact however, the March
result would in fact represented an increase with the
integration of Dream Pharma going well
• Contributed by the synergies of co-promotional sales
efforts between Kunwha and Dream Pharma and Lotus’
license fees related to a partnership for product sales into
China, April sales achieved yet another record high with a
solid MoM growth of 4.4%
Key highlights Unit: NT$MM
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2015 OUTLOOK
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2015 OUTLOOK
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Goals in 2015
2015 Outlook
• Successful integration of Dream Pharma and Kunwha in Korea
• Further expand Lotus’ export business by launching more products in the US
• Achieve solid profit and positive EPS
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APPENDIX
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APPENDIX
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Taiwan Pharma Market Overview
Taiwan Market Overview
• Taiwan is a ~US$5.5 billion pharma market. Fast aging
population drives volume demand growth
• Taiwan has a National Health Insurance system covering
96% of the population under a one payer system
• Payer is public; however, health administration is through
private (non-profit) hospitals, clinics, and pharmacies.
Hospitals are the dominate health care provider and are
large behemoths offering both in and outpatient care
• Large concentration of the market in 21 medical centers
which have around 35% of the total healthcare market
• Bad perception of local product quality prevented generic
penetration into large medical centers so far so only
multinational generics are able to get in as of now
• Regulatory approval timelines are between 12 to 18
months for generics products
• Taiwan has joined PIC/S from January 2014. Among the
current 160 local manufacturers, only 70 have completed
accreditation so far
80%
9%
11%
Hospitals G.P. (Clinics) Drug stores
Total Market
~US$5.5bn
Taiwan Market Segmentation
Hospitals
20% 35%
45%
Drug Stores
40%
20%
40%
G.P. (Clinics)
65%
15%
20%
Generic Patented Originator patent expired
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APPENDIX
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Korea Pharma Market Overview
Korea Market Overview
• Korea is a ~US$15.8 billion pharma market and is
expected to continuously grow due to aging population
and increase in chronic diseases followed by growing
demands for medical treatments
• Korea has a government funded health care system with
complete coverage of the Korean population under one
single payer (the NHIC)
• Further promotion of generic usage expected by the
NHIC to reduce health care costs
• Price erosion will be compensated by strong volume
growth due to increased consumption by a fast aging
population and further expansion of the health care
coverage
• Generic regulatory approval times currently are around 6
to 9 months for locally produced products and 9 to 12
months for imported generics. It is expected the bias
favoring local production will remain
• The market is expected to be restructured led by top
pharma companies with R&D and product capabilities
Korea Anti-obesity Drugs Market Outlook
• Korea’s medical diet market (including Korean medicine
clinics, surgery, anti-obesity drugs) is estimated to be
~KRW1.6 trillion at the end of 2013, whereby the anti-
obesity drugs market accounts for ~9%
• With a growing perception that “obesity is an illness,”
there is continued social focus on losing weight not only
from external appearance perspective but also from
pursuing a healthy life
• Anti-obesity drugs possess a clear competitive advantage
over its substitutes, as it maximizes the effect of weight
loss within relatively shorter period of time at a lower cost
(v.s. oriental medicine that requires consistent
consumption and bariatric surgery with potential of high
risk side effects)
• Consequently, overall anti-obesity drugs market is
expected to account for a higher proportion of the
domestic medical diet market
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APPENDIX
• An international privately-owned specialty pharmaceutical
company focused on the development, manufacturing and
marketing of generic pharmaceuticals, biosimilar and OTC
products
• Led by Chairman/CEO Robert Wessman and management
team that previously worked at Delta / Actavis Group
• Robust product portfolio consists of a broad range of molecules
for treating conditions in the fields of oncology, cardiology,
respiratory, neurology and gastroenterology
• Deep experience in generic drug development with an strong
track record of growth through organic growth and acquisitions
• Has manufacturing capabilities in US, Romania, Korea and
Taiwan, and commercial operations in over 30 countries
• Geographic presence across the US, Central and Eastern
Europe as well as Asia (Korea, Taiwan, China, Japan, India,
etc.)
• Alvogen’s total revenue grew at a CAGR of 77% from 2009 to
2014 with 59% from organic growth
Alvogen Overview Alvogen Support
Alvogen Today
Page I 27
• Alvogen is committed to support Lotus for future growth to achieve
its target to become top-5 regional player in the APAC region by
leading industry consolidation
• Alvogen formally became a majority shareholder in Lotus in
August 2014, currently owning approximately 63.4 % of
outstanding shares following a private placement
• As a part of the transaction, Lotus acquired 3 of Alvogen’s
businesses in Asia: Korea, Taiwan and India
• Securing distribution rights for biosimilar products currently under
development by Alvogen’s sister company AlvoTech
• Furthermore, Lotus’ subsidiary Kunwha acquired Dream
Pharma in Korea in December 2014
• Co-development with Lotus with a focus on US difficult-to-make /
high barrier products, i.e. oncology orals, hormones and soft gels
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Key Milestone • Founded in 1958
• Acquired by Alvogen in October, 2012
Business Mix • Prescription, OTC, medical device sales, export, consignment business
• 72 molecules (99 products)
Production • Plant in Gongju: 46,893m2
Sales Network • 14 district sales organizations
Employee / Office • 257 employees in total as at the end of March 2015 – G&A (33). S&M(115), Plant incl. R&D (109)
• Headquartered in Seoul
APPENDIX
Recent Acquisitions
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Kunwha Pharma – Acquired by Lotus in January, 2014
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Dream Pharma – Acquired by Lotus Subsidiary Kunwha in December, 2014
Key Milestone
• Established as the pharmaceutical division of Hanwha Corporation (March 1996)
• Changed the company name to DreamPharma Corporation (January 2005)
• Acquired Meditech Korea Pharm Co., Ltd. (September 2006)
Product Mix
• Anti-obesity drugs (56% of 2013 revenue): unrivalled #1 player in Korea with c.35% M/S
• Prescription (“Rx”) (37% of 2013 revenue): competitive advantages possessed in antibiotics, antifungal drug,
hyperlipidemia treatment
• Possesses two OTC products and a closure of esthetique business completed in 2013
R&D
• Leading R&D personnel: 79% with a postgraduate degree, 34% with a pharmaceutical career experience of at
least 10 years
• Secured Korea’s New Drug Development Technical Award for Bonviva Plus (February 2014)
Production • Production and quality assurance of 106 drug items through in-house production (57 items) and outsourced
production (49 items) compliant with KGMP (Korea Good Manufacturing Practice)
Sales Network • c.3,650 clinics and c.70 general hospitals in Korea
Employee / Office • 365 employees in total as at the end of March 2015 – G&A (34), R&D (39), S&M (179), Plant (113)
• Operates 8 branches and 2 sales offices nationwide
APPENDIX
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Recent Acquisitions (cont’d)
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APPENDIX
Recent corporate action in Korea
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Merger timeline Date
Board resolution for the execution of merger agreement March 17 2015 Completed
Disclosure of Board resolution and relevant filing March 17 2015 Completed
Execution of merger agreement March 18 2015 Completed
Confirm the shareholders on shareholder registry April 1 2015 Completed
Announcement of small scale merger April 1 2015 Completed
Closure of shareholders’ registry April 2 - April 9 2015 Completed
Receipt of notice from dissenting shareholders April 2 – April 16 2015 Completed
Board resolution to approve the merger April 27 2015 Completed
Dissenting creditor notification process April 28 – May 29 2015
Merger date June 1 2015
Merger between Kunwha Pharmaceutical and Dream Pharma Corporation
• Since Dream Pharma is 100% owned by Kunwha Pharmaceutical, the merger can be completed as small-
scale merger to Kunwha / short-form merger to Dream Pharma. Only board meeting of two entities are
required unless 20% of shareholders notified its objection towards to merger between two entities
• Minority shareholders of Kunwha only account for 17.5% - no shareholders’ objection is expected
• Merger ratio – 1:0 (Kunwha/Dream)