2018 Annual Results Presentation Sihuan Pharmaceutical Holdings Group Ltd. 四环医药控股集团有限公司 0 Disclaimer The sole purpose of this Presentation (the “Presentation”) is to assist the recipient in deciding whether it wishes to proceed with a further investigation of Sihuan Pharmaceutical Holdings Group Ltd. (the “Company”) and it is not intended to form the basis of any decision to purchase securities, interests or assets in or of the Company. This Presentation does not constitute or contain an offer or invitation or recommendation or solicitation for the sale or purchase of securities, interests or assets in or of the Company and neither this document nor anything contained herein shall form the basis of, or be relied upon in connection with, any contract or commitment whatsoever. 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Any prospective purchaser interested in purchasing securities, interests or assets in or of the Company or evaluating the Company is recommended to seek its own financial and other professional advice. 1 目录 1 Performance Review Sales Performance 2 3 R&D Progress 4 R&D Platform 5 Financial Review 6 Future Strategies 7 Appendix 2 1 Performance Review Maintaining Healthy Financial Standing Profit Net Cash R&D Revenue Attributable to Flows Expenditure RMB2,917.4 Owners RMB1,792.8 RMB533.2 million RMB1,620.0 million million million • Revenue of the Group increased by 6.2% to RMB2,917.4 million in 2018 • Profit attributable to owners of the Company increased by 11.8% to RMB1,620.0 million in 2018 • R&D expenditure increased by 48.3% to RMB533.2 million, accounting for 18.3% of total revenue • Net Cash Flows reached RMB1,792.8 million • Gross profit margin increased from 72.4% to 81.5%; Net profit margin increased from 53.9% to 57.6% • Proposed final cash dividend per share is RMB1.3 cents 4 Efficient Market Management to Realize Product Potential Mature Products Fast-growth Products +39.3% +53.7% +71.4% +131.2% Troxerutin and Cerebroprotein Danshen Chuanxiongqin Injection Roxatidine Acetate Hydrochloride Monoammonium Glycyrrhizinate Hydrolysate Injection (Wei'Ao) for Injection and Sodium Chloride Injection (Yuanzhijiu/Xingwei/Xinshengtong) (Jie'Ao) (Huineng) A number of major products, which includes Oudimei, Yuanzhijiu/Xingwei, Jie’ao, Huineng and Mainokang, have been included in the Clinical Pathways Interpretation and the Interpretation of Clinical Pathways for Therapeutic Drugs. Huineng has been included in the Rheymatology Section in the guideline’s 2018 edition. Breakthroughs of Multiple R&D Projects The Group’s first anti-diabetic innovative patented new drug Janagliflozin commenced Phase Ⅲ clinical trials in China. Commenced Phase Ⅱ clinical trials in China of three innovative drugs, which includes 1）digestive system drug Anaprazole Sodium 2）China’s first independently patented innovative cabapenem antibiotic Benapenem 3） innovative oncology targeted drug Pirotinib. Antihypertensive drug Tylerdipine Hydrochloride has finished Phase Ⅰ studies in healthy invididuals and has initiated trials in patients. Besides, another three innovative drugs have commenced Phase Ⅰ clinical trials respectively. They are 1) selective CDK4/6 inhibitor Birociclib 2) a third generation irreversible tyrosine kinase inhibitor XZP-3621 3) PDE-5 inhibitor Fadanafil. Metformin Hydrochloride Tablets obtained consistency evaluation approval. Exclusive product and paediatric medicine Midazolam Oromucosal Solution has been included in the Priority Review Process. The Company is the first in China with the drug registration approval for Compound Electropyte Injection (Ⅱ) (500mL). Compound Amino Acid Injection (20AA) granted approval for drug registration. Production approval has been obtained for Octreotide Acetate Injection, Ambroxol Hydrochloride Injection and Buflomedil Hydrochloride Injection. “Non-PVC solid-liquid double chamber infusion soft bag”(including Ceftazidine,Cefuroxime, Cefodizime has passed on-site assessment. 6 Global BD Expansion —Established to Enrich Product Portfolio • Global Business Development Department is established with offices located in China and US. • Team is comprised of experts with extensive experience in domestic and overseas pharmaceutical industry. • Focus on the development of cutting-edge drugs in oncology and other major therapeutic areas. M&A and International Collaborations Company Initiation Partnership Other Information Date Croma-Pharma 2017 Set up joint • Expanded to aesthetic medicine business GmbH venture • First product Princess® VOLUME dermal filler was granted approval and has been launched to market PharmaDax 2017 Staged • Subscribe for 19.99% equity interests and corporate Foshan investment bonds issued by PharmaDax Foshan at the consideration of RMB200 M • Equipped with FDA approved production line Medifood 2017 Acquisition • Acquired 50% equity in U.S. Foods for Special GmbH Medical Purposes (FSMP) manufacturer Medifood GmbH • Obtained exclusive manufacture, marketing and distribution rights in Greater China Medtrition Inc. 2017 Acquisition • Acquired FSMP manufacturer Meditrition Inc. • Obtained exclusive distribution rights in Greater China Covance 2015 Reached joint • Reached long-term partnership agreement to support agreement the pre-clinical and clinical development of new drug pipeline Hugel Inc. 2014 Reached joint • Joint R&D of Botulinum toxin and Hyaluronic acid agreement • Clinical trials in China have been completed 重庆派金生物 Chong Qing 2014 Reached joint • Reached agreements on 5 projects including Insulin 科技有限公司 Paijin Biotech agreement Degludec and Insulin Aspart Ambest 2017 Acquisition • Acquired 100% equity at a consideration of RMB1.1B Pharmaceutical