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LOTUS PHARMACEUTICALBUILDING A REGIONAL LEADER

Aug 2017

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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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Table of Contents

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Company Overview

Profitable Growth

1H 2017 Financial Results

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COMPANY OVERVIEW

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LOTUS PHARMACEUTICAL IS AN APAC GENERICS LEADER

1

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Founded in 1966Lotus Pharmaceutical is among Taiwan’s largest specialty-generic drug

developers and one of the early movers to export to the US market since 2011

Its portfolio includes CNS, CVS, oncology, women health, anti-obesity, respiratory

and pain relief in forms of tablet, capsule, and soft gel capsule

The rising generic leader in APACLotus is positioned as a regional platform for Alvogen Group (63.4% holding in

Lotus) since Aug 2014 through a reverse merger, and leverages Alvogen Group’s

cross-border reach to scale up

The current operation scope of Lotus spans across Lotus Taiwan’s domestic

business, Alvogen Korea’s domestic business, Alvogen Pharma India’s CRO

business, and export businesses

Capital market milestone

Lotus Pharmaceutical (1795. TWO) has been listed on Taipei Stock Exchange

since 2010 and became a Taiwan Market Biotechnology and Medical Care Index

stock in July 2017

Extraordinary quality management Lotus’ R&D and manufacturing facilities in Nantou is the only one in Asia that’s

approved by US FDA, EU EMA, Japan PMDA and TFDA PIC/S

1

2

3

4

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70+ Generic products in pipeline

2 Biosimilar products in pipeline (mab’s)

8 MAs in the US; 25 MAs in Europe;

8 MAs in Japan; 1 MA in China

A FAST GROWING GENERICS & SPECIALTY PHARMACEUTICAL POWERHOUSE

Lotus facts

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1000+ Employees

3 Manufacturing and R&D Centers

250+ Marketed products

140+ Submissions since 2012

11%

19%

23%

47%

Lotus Taiwan EmployeesTotal: 365

G&A

R&D

S&M

Plant

9%7%

52%

32%

Alvogen Korea Employees Total: 561

G&A

R&D

S&M

Plant

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36% 34% 34%30% 30% 28% 29%

41.7%

26%22%

12%12% 10%

12% 10% 14%16%

8.9%

10%10%

4%4% 7%

7%4%

4%6%

15.7%

6%

4%

5.4% 6.8%11.4%

8.5% 10.4%12.9%

5.6%

-13.0%

5.6%10.6%

Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17

SM GA RD OPM

THE PAST 2 YEARS WERE TRANSITIONAL

Operating synergy emerging following transitions in portfolio and S&M strategies

OPEX % 69% 50%

1,590 2,780Total OPEX

(NT$mn)

50% 50% 49%

669 711 725

44%

631

52%

675

46%

742

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51%

729

43%

33% 32%

24%

20%

12% 12%

10%

6%

5% 8%

5%

FY2014 FY2015 FY2016 1H2017

52%

3,084

66%

982

42%

592

39%

1,172

37%

580

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EXPANDING REVENUE AND GROSS MARGIN ARE OUR TOP PRIORITIES

Revenue (NT$m) Gross margin

663

12941337

14171473

1425

1594

14041479

1436

1557

Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17

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43%

58% 57%

62%

58%

55%

59%57%

54%

47% 47%

Q4'14Q1'15Q2'15Q3'15Q4'15Q1'16Q2'16Q3'16Q4'16Q1'17Q2'17

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2015-2016

POST MERGERINTEGRATIONPHASE

2017-2018

INITIALGROWTHPHASE

2019～

EXPLOSIVEGROWTHPHASE

AFTER 2.5 YEARS OF INTEGRATION, LOTUS IS ENTERING INTO A GROWTH PHASE

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• Plant upgrade in Nantou,

Taiwan

• Successful management

team change

• Portfolio and pipeline

reshape

• Sales and marketing

strategy adjustment

• Solidify local portfolio

through key launches

• Start shipments of ANDA

approved drugs

• Continue to increase

operational efficiency

• Export revenues to

significantly grow from

several successful key PIV-

challenges

• High value products to drive

up gross margin

• Continue to improve

financial structure

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PROFITABLE GROWTH

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OUR GOAL IN THE NEXT 3 YEARS IS TO DELIVER PROFITABLE GROWTH

Back to Basics

Value Differentiation

Geared Up For The Future

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Profitable

Growth

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BACK TO BASICS

• Strongest Portfolio

• Best Service

• Best Quality

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28%

22%

4%3%2%

41%

Anti-obesity/lifestyle & Gastrointestinal productsCardiovascularCentral Nervous SystemOncologyWomen healthcare

17%

17%

6%

16%5%

39%

STRONGEST PORTFOLIO SURROUNDING 5 SPECIALTY AREAS

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Note: Others include respiratory system, pain killers, nephrology, anti-inflammatory and so on

2016E to 2020F therapeutic area revenue breakdown

2016A 2020F

19%

18%

8%16%

6%

33%

1H2017

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STRONGEST LOCAL PORTFOLIO WITH MARKET SHARE LEADER POSITION

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KOREA TAIWAN

Market

Size

• Population: 50mn

• Pharmaceutical market: US$15.8bn @

3.7% YoY growth

• Population: 23mn

• Pharmaceutical market: US$5.5bn @

7.1% YoY growth

Market

Position

• Focuses on Incrementally Modified

Drug such as Fixed Dosage

Combination

• Anti-obesity drugs market share leader

(20%) in Korea

• OTC contraceptive drug market share

leader (40%) in Korea

• Leading player in CVS, CNS and

nephrology drugs

• Top 3 pharma company in Taiwan on

consolidated revenue base

• Leading player in CNS, oncology and

hormonal drugs

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LOTUS PHARMACEUTICAL PROVIDES BEST SERVICE IN EVERY ASPECT

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Growing key markets sales team

70 in-house sales in Taiwan and 299 in-house sales in Korea, covering drug

stores, clinics, general and community hospitals

The best R&D partner

Partner with new drug companies from formulation development, phase I, or

clinical trial, providing critical CDMO or R&D services to new oncology drugs

companies targeting advanced markets such as US, EU and JP

Achieving vertical integration through CRO capabilities in India

Norwich Clinical Service provides biostudy, clinical and pharmacovigilance

services to Lotus & Alvogen Group and 3rd party customers, and holds an

oncology center in Bangalore, India

1

2

3

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BEST QUALITY MAKES US THE MOST PREFERRED PARTNER OF OUR CUSTOMERS

Lotus quality record

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Korea – Gongju Plant Korea – Hyangnam Plant Taiwan – Nantou Plant

Products

• Tablets

• Coated tablets

• Hard capsules

• Powders, granules

• Tablets

• Coated tablets

• Hard capsules

• Powders, granules

• Tablets

• Coated tablets

• Softgel capsules

• Hard capsules

Capacity• Max capacity at 500mn

units of tablets

• Max capacity at 800mn

units of tablets

• Max capacity at 1.5bn

units of tablets

Accreditation • KGMP compliant • KGMP compliant

• US FDA, EU EMA, Japan

PMDA & TFDA PIC/S

approved

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VALUE DIFFERENTIATION

• Shortest Time to Market

• High Value Pipeline

• Leader in Special Dosage

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Capture global generics growth through Alvogen’s 3 regional platforms

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North America

$115-145bn growth

Latin America

$25-35bn growth

Europe

$25-35bn growthAsia

$100-130bn growth

AFME

$15-25bn growth

IMS “Global Spending On Medicines 2014-2020”

49%

44%

7%

9%

61%

30%

33%

50%

30%

37%

46%

30%

26%

59%

15%

35%

52%

13%

Brand Generic Other

Global

$305-335bn growth

LEVERAGE ALVOGEN‘S GLOBAL SALES NETWORK TO CROSS SELL

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THEREFORE, LOTUS CAN ACHIEVE SHORTEST TIME TO MARKET

• Ability to leverage customer demand information across the group

• Robust regional supply chain network

✓ Prompt and seamless coordination of complex supply and distribution network

✓ Supported by 5 manufacturing sites across the Lotus and Alvogen group

• Ability to deliver 97% order next-day without major stock-outs

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HIGH VALUE PIPELINE FUELS REVENUE AND PROFITABILITY GROWTH

Export timeline from now – 2020 approval out-license shipment

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INN Indication 1H’16 2H’16 1H’17 2H’17 2018 2019 2020

Paricalcitol

1/2/4 mcg

Nephrology

慢性腎衰竭

Temozolomide

5/20/100/140/180/

250 mg

Brain Cancer

腦癌

Levetiracetam

ER 500/750mg

IR 250/750/1000mg

Anti-epilepsy

抗癲癇

Levonorgestrel

0.75mg

Contraceptive

避孕

Calcium Acetate

667mg

Nephrology

洗腎

Budesonide ER GI

結腸潰瘍

Buprenorphine/

Naloxone

Addiction

戒毒

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INN Indication 1H’16 2H’16 1H’17 2H’17 2018 2019 2020

Methotrexate Chemo

癌症

GefitinibNon-small-cell lung

cancer; Inhibitor

非小細胞肺癌

LP127 Anti-epilepsy

抗癲癇

LP083

(CDMO project / JP)

Women health

女性保健

Acarbose Antidiabetic

糖尿病

Vinorelbine

softgel capsule

Breast cancer

乳癌

Lenalidomide Multiple

Myeloma

血癌

LP149 Women health

女性保健

Export timeline from now – 2020 approval out-license shipment

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Strength extension

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LOTUS PHARMACEUTICAL IS THE REGIONAL LEADER IN SPECIAL DOSAGE

Soft Gel Manufacturing

• Investment in dedicated manufacturing area starting 2009 and

current capacity at 500mn capsules / year

• State of the Art equipment

✓ Closed melting and mixing Tanks

✓ PharmaGel GKF-072 filling machine

✓ Fully automatic visual inspection

• Extensive soft gel manufacturing experience in

✓ BCS class III & class IV new drug

✓ Generics low melting point molecules

✓ Generics with low stability molecules that are sensitive to

light, heat and humidity

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GEARED UP FOR THE FUTURE

• Biosimilar Ready

• M&A Mode Always On

• Winning Business Strategies

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0.1 0.1 0.2 0.3 0.6 1.5

3.7

6.5

9.1

10.6 11.1

12.1 12.5 12.7

0.4 0.5 0.6 0.7 0.9

1.1

1.5

2.2

2.8

3.4

3.8

4.2

4.9 4.8

0.1 0.1 0.1 0.1 0.2

0.2

0.4

0.6

0.8

1.0

1.2

1.5

1.7 1.9

-

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

20.0

2012 2013 2014 2015 2016F 2017F 2018F 2019F 2020F 2021F 2022F 2023F 2024F 2025F

US Europe ROW

BIOSIMILAR READY

Lotus’ Biosimilar Play

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• Biosimilars have reached an inflection point and we expect very rapid growth from

2017 onwards

• Secured APAC ex. Japan distribution rights of 2 biosimilar products of Alvotech,

Alvogen’s sister company

US$Bn

Source: PharmaCloud

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M&A MODE ALWAYS ON

Pharmaceutical 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% 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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Constantly looking for companies that complements our S&M strategy or portfolio

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AS THE EXPERT IN ASIA, LOTUS HAS A SET OF WINNING BUSINESS STRATEGIES

Being the expert in APAC pharmaceutical market

• We address APAC market through both local sales team and distribution network

• We fulfill the neglected generic needs of key local markets to bring down healthcare cost

for more people

• We out-license or divest certain portfolio that are better fits of other pharmaceuticals to

extract full value of our assets

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1H 2017 FINANCIAL RESULTS

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HIGHER OPERATIONAL EFFICIENCY LED TO A PROFITABLE QUARTER

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Unit: NT$000 2Q 2017 % 2Q 2016 % 1Q 2017 % YoY QoQ

REVENUE $1,577,430 100 $1,594,332 100 $1,436,112 100 -1.1% 9.8%

COGS 829,640 53 647,382 41 763,716 53 28.2% 8.6%

GROSS PROFIT 747,790 47 946,950 59 672,396 47 -21.0% 11.2%

OPEX

S&M 350,393 22 450,149 28 366,801 26 -22.2% -4.5%

G&A 160,021 10 225,584 14 146,902 10 -29.1% 8.9%

R&D 69,653 4 66,093 4 78,262 6 5.4% -11.0%

Total OPEX 580,067 37 741,826 47 591,965 42 -21.8% -2.0%

OPERATING PROFIT (LOSS) 167,723 11 205,124 13 80,431 5 -18.2% 108.5%

NON-OP INCOME & EXP

Finance costs (63,341) (4) (71,021) (4) (61,139) (4) -10.8% 3.6%

Others 1,774 0 (12,481) (1) (87,189) (6) - -

Total non-op expenses, net (61,567) (4) (83,502) (5) (148,328) (10) -26.3% -58.5%

INCOME BEFORE TAX 106,156 7 121,622 8 (67,897) (5) -12.7% NA

INCOME TAX EXPENSE

(BENEFIT)48,632 3 67,267 4 (5,806) - -27.7% NA

NET ERANINGS (LOSS) 57,524 4 54,355 3 (73,703) (5) 5.8% NA

EPS $0.15 $0.07 $(0.30) 114.3% NA

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BALANCE SHEET AT JUNE-30 2017

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