Shasun Pharmaceuticals Limited Analyst meeting Presentation 10 th Feb 14

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Disclaimer

This presentation may include certain “forward looking statements” , based on current expectations, within the meaning of applicable laws and regulations. Actual results may differ and the company does not guarantee realization of these statements. The Company also disclaims any obligation to revise any forward-looking statements. The readers may use their own judgment and are advised to make their own calculations before deciding on any matter based on the information given herein.

No part of this presentation may be reproduced, quoted or circulated without prior written approval from Shasun Pharmaceuticals Limited.

Shasun Transformation Strategy

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Shasun Journey in to the future

The Last 5 years of

• incubating new capabilities

• enabling and understanding of technologies,

•expansion of capacities,

• and focused business development in global markets positions

• Shasun ideally to launch its transformational Strategy

Shasun Business Profile – Transformation A Innovative, Integrated Global Pharmaceutical Co.

Integrated R & D

Process R&D – India Europe, : 200 Scientists Formulation R&D: India, : 70 Scientists, regulatory and Development scientists Bio Pharmaceutical and Nano Drug Delivery : India, USA : 25 Scientists

Integrated Actives (API) Manufacturing

Multiple CGMP Facilities across India and Europe. 2000 people Multi product facilities Veterinary Products facility I JV with Strides in India for global supplies

Integrated Formulation manufacturing

Multi Product facility with over 5 Billion tablets capacity: India Expansion from Oral Solid Dosage leveraging on technologies to Transdermal, Injectible etc..

Technology Drug Delivery

Cancer Therapeutics

Therapeutic Franchise Rx

OTC Nutritional

Markets USA, Japan

Europe (Selective) India, Russia, Brazil 5

Transformation to a Globally Integrated Pharmaceutical Company

enabled by partnerships, reliable innovation to deliver differentiated, affordable health care to patients worldwide while returning greater

value to all Stake holders.

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Shasun Transformation theme

The Transformed Business Profile A Innovative, Integrated Global Pharmaceutical Co .

Integrated R & D

Process R&D – India Europe, USA (2014): 200 Scientists Formulation R&D: India, : 70 Scientists, regulatory and Development scientists Bio Pharmaceutical and Nano Drug Delivery : India, USA : 5 Scientists

Integrated Actives (API) Manufacturing

Multiple CGMP Facilities across India and Europe. 1800 people Multi product facilities

Integrated Formulation manufacturing

Multi Product facility with over 5 Billion tablets capacity: 500 People, India Expansion from Oral Solid Dosage leveraging on technologies to Topical; Sachet & Transdermal

Technology Drug Delivery

Cancer Therapeutics

Therapeutic Franchise Rx

OTC Nutritional

Markets USA, Japan

Europe (Selective) India, Russia, Brazil

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North America(NA) – Leads to ROW strategy

• Drug Delivery

• Technology

Innovation

• Formulation • Integrated

R&D

Manufacturing • OTC / Rx NA • OTC/Rx

ROW Sales

Marketing

Our Strategy is enabled to differentiate and resonate with the Market needs - focuses optimal utilization of our invested capacities. - Target investments in Differentiated Products while enabling Therapeutic Franchise(s) - Penetrate Markets with Innovation – Products providing for “sustainable” “Niche” /higher market share - Expand “ as we learn and earn” approach to integrate manufacturing in the key markets - Enable a “Reliable and Innovative” Shasun brand in the global marketplace.

A North American Base to lead our global strategy helps achieve our objectives in the ROW Markets as well

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Strategic areas of focus

Innovation

Technology Platform focused on Drug Delivery

Integration & Expansion of Portfolio

Optimize Capacities in the Actives manufacturing with high capacity utilization and high return products Expand the successful Formulation capabilities in India and Key markets

Global Sales & Distribution:

Expand On the ground marketing presence in Key Markets of NA and ROW Enable Logistics. Expand Portfolio of Assets thru Organic development, acquisition of Brands and Co marketing

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Transformation Intent – Resonating with the Marketplace

Innovation

•Pursuit of Innovative Products & Technologies focused on selective niche to Broad markets

•Differentiated for enhanced Safety, Compliance and Efficacy profiles.

•Exclusivity and IP protection a major advantage.

Integrated manufacturing

• Establish / acquire capacities and products in key markets.

• Integrated manufacturing by leveraging global locations via backward integration from actives to Packaging in key product franchises

•Derisk and deliver from regional as well as arbitraged locations

Global Marketing / Distribution

•Establish engaged ground presence in Key markets of USA, Europe, Russia, Japan, Brazil, and India with appropriate partnering initiatives

•Partner with Key Retailers and distributors for Branding and Co-Branding appropriate franchises

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Partnering Key to the Success of the Strategy

Global Academia

Global Pharma

Global Retailers

• Multiple investments across Technology platforms in US & Europe

• Joint Ventures and Sponsor programs for nurturing & Accessing innovation

• Partner to most Global Pharma companies for supplies of API and Dosage Forms .

• Expand into Strategic portfolio, brand or product specific relationships

• Develop strategic & vendor oriented partnerships with Key market leaders

• Invested Portfolio optimizing development costs in key markets

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Some Key Initiatives in enabling the Global Strategy

Enabling the Technology Platform – Consolidation and integration of all Shasun / acquired technologies completed. – Portfolio of Assets enabled and pursuit of the same towards potential POC.

Thereby establishing a valuation for any partnering funding needs (WIP). – Leadership Assembled and will be enabled for execution March 2015. – Team and strategy enabled thru significant investment and optimized for

operations in the next 3 year horizon. Sales and Marketing

– OTC organization and Leadership enabled for NA and WIP in ROW. – Rx Leadership identified, Two partnerships enabled in NA with a significant

Portfolio value. Portfolio already in Development with clarity on launch dates effectively finalized.

– Investments made in Brand and Portfolio acquisition and being consolidated for Launch and partnering.

– Emphasis on BD with multiple Strategic discussions underway to enable conclusion by end of 2014.

Manufacturing expansion – Sites and locations being identified for expansion efforts in 2015

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Key Drivers to generate value added Portfolio.

Acquired/In-License Third

Party Portfolio

New Area of Investment

Innovation

CDAMS

Own Portfolio

Portfolio developed thru Internal and partnered innovation Blend Generics and innovation to realize Higher returns and Derisk effectively

Optimize and focus on high Value contract manufacturing Opportunities to enhance ROI

Expand Capabilities in topical; transdermal,Nano and other safety Enhancement platform

Portfolio well spread between Rx; OTC and NDA 505 (b)(2) both thru internal & in-license

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Potential Rx Portfolio Value. Staying away from Commodity

•Partnered Portfolio • Co-invested, Co developed and Acquired

•Shasun Portfolio: •Home grown differentiated products with potential market leadership

•Partnered Para IV-FTF •Shasun does not engage in litigation

•Third Party Portfolio: •Partnered including Profit Sharing

Market Value

US$3.3Bn

Market Value

US$3.8Bn

Market Value

US$ 1.45Bn

Market Value

US$ 11.5Bn

Shasun entry in to Rx segment in USA

Total Market Value US $20 Billion

As of 2014

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OTC Franchise Approach

Nutritional Cough &

Cold/ Allergy GI Pain & Inflammation

Products are offered in partnership both on exclusive and non exclusive basis

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Shasun Consolidated Portfolio Spread

5%

14%

27%

14%

23%

0% 1%

16%

DR

ER

IR-Complex

NDA 505 (b)(2)

IR

Sachet

Suspension

Topical

- Products Differentiated by technology, enhanced safety, Compliance Profile & IP - Opportunity for higher market share and potentially higher and long term returns

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Potential Challenges – Advisory that has been considered

Regulatory Approval Repeat BE Studies Timely filing of ANDA Competition Conversion on Retailer Bids Consumer demand On time for Bidding Process

Higher Market Share Expedited Review Ability to Compete Vertical Integration

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Drug Delivery Partnerships 2013

Company Partner Amount Technology Comments

AcelRx Grünenthal $ 250 Million Zalviso - Pain Management System

Zalviso - a handheld system designed to deliver sufentanil NanoTabs under the tongue in a controlled dose for post-op patients. Lengthened Intervals to 80- 90 minutes as compared to typical 20 – 40 minutes IV.

Alnylam The Medicines Co.

$ 205 Million RNAi delivery platform

Alnylam licensed PCSK9 candidate for high cholesterol using the RNAi tech that, when delivered correctly, can knock down a gene that spurs cholesterol synthesis.

Ensemble Alexion, Novartis Undisclosed Ensemblins Biologics deliverable orally as opposed to by injection

Molecular Partners

Roche $ 60 Million upfront and over $ 1 billion in milestones

Protein Delivery for Cancer - DARPins

Molecular Parttners - the most prominent class of binding proteins in nature, using a single structural motif stacked together into a scaffold that can bind to a drug and deliver it to the site of a tumor.

OptiNose Avanir $ 110 Million Inhaled migraine treatment with inhaler

Inhaler uses - bidirectional nasal technology. The inhaler has a mouthpiece and a nosepiece, using the patient's natural breathing for nasal delivery. Blowing into the mouthpiece propels drugs into the nasal cavity.

Santaris Bristol-Myers Squibb

$ 10 Milllion up front and $ 90 Million for each product

Locked Nucleic Acid (LNA) platform for RNA drugs

LNA platform is not a drug delivery vehicle, the technology helps make RNA a more efficient treatment option, according to the company, by making the drugs smaller and giving them a greater affinity for RNA targets.

Unilife Novartis, AZ – undisclosed, Hikma - $40 M, Sanofi – 150 M units yearly

Injectables Each partner is looking to deliver various drugs thru injectables and are innovative delivery systems and 505 b 2s.

Increased Trend in the marketplace to enhance Targeted Drug Delivery

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Shasun Drug Delivery Vertical (SDDV) Optimal Integration of Technologies

SDDV platform is enabled to focus on optimizing Shasun’s efforts to provide : •Differentiated Products in Strategic Therapeutic areas. •Enhance Safety of Products – Approved and in Development. •Enable Higher Patient Compliance thru Modulated release for both approved and products in development. •Enable unique and patented manufacturing capabilities for higher realization in the CDAMS business. The Strategy is enabled thru a combination of home grown technologies, Invested partnerships and acquired / licensing of technologies.

• Gold & Silver Targeted Therapy focused on potential to build a Oncology vertical

• Device – Drug Platform Enabled thru the JV with a University of Missouri Spin Out

Nano Delivery Platform

• Multi Therapeutic platform focused on enabling safety and efficacy via Polymeric Nano encapsulation.

• Enabled across Diagnostic and Therapeutic applications

Polymeric Drug

Delivery Platform

• Controlled, Extended and Modulated Release platforms that will ensure differentiated Delivery for approved drugs strengthened by regulatory (505B2) and Intellectual Property.

• Investment in Transdermal Technologies for Pain management

Modulated Drug

delivery technologies

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The Transformation Outlook - 2020 Focused on optimal utilization of capital and higher returns thru innovation and brand value

• Invested and Enabled: • A carefully selected portfolio of

Assets in the Rx. • Leveraging our strengths in the OTC

Pain Franchise. • Initiated strategic partnerships

across key markets with on ground presence

• Invested and incubated key differentiating technologies

• Acquisition and investment in assets and brands.

• Impact and Outlook: • Portfolio: Robust Portfolio of

Products in play enabling growth • SDDV:Enabled technology platforms

provide for value based exits to continue to provide de-risked capital to further Innovation.

• Creating a Global Brand for Shasun: that is reliable, innovative and accepted irrespective of its geographical location.

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Shasun India Business

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Business overview Shasun – Business Segments

Active Pharmaceutical Ingredients:

– Shasun is the largest manufacturer of Ibuprofen in the world. Its current API portfolio includes Ibuprofen, Nizatidine, Ranitidine , Gabapentin , Olanzapine and Cycloserine amongst others

– Active New API product development pipeline

API Contract Research & Manufacturing (CRAMS):

– Shasun’s CRAMS business spans India and UK

– SPSL Dudley, UK facility has over 40 years of expertise in working with top pharma companies for custom services and manufacturing. It has a very healthy mix of emerging and big pharma clients

Finished Dosages – Formulation CRAMS

– Provides oral solid dosage development and manufacturing services at its Formulations facility in Pondicherry

– This facility has undergone successful inspections by US FDA, MHRA (UK) and TPD Health Canada

– Expanded formulations capacity billion tablets per annum

Biotech:

– This unit launched Streptokinase, a fibrinolytic drug used for the treatment of heart attacks

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Shasun India –Business Update Formulation • Successfully completed USFDA,ANVISA and MHRA Inspection. • Continuous coating machine commissioned • Growth in Development revenue

Pondy Ibu Plant • Capacity increase completed • Further process improvement to improve margin

Cuddalore • Major product process improvement to improve margin • API product for new generic launch in Japan •Strong growth in matured API products •New product capacity expansion completed CRAMS –API • Increase in business visibility and acquisition of new business

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API DMFs filing Trend

Shasun owns 34 active DMFs till year 2012-13 In the current year 5 DMFs have been filed; and 4 more DMFs are planned for filing by March 2014; tallying our numbers to 43 DMFs

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CRAMS API – India Key Growth Drivers

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CRAMS- Formulations product pipeline

Strong growth product pipeline

USA Europe ROW IndianCustomer Customer Customer Customer

ANDA commercialised 4 2 - - 6 ANDA awaiting regulatory approval 2 - - - 2 ANDA Ready for Filing - - 1 1 ANDA /NDA Pipeline 4 4 1 9 Site / tech transfer commercialized 8 7 10 - 25 Site / tech transfer approved and not commercialized 5 5 Site / tech transfer Awaiting for approval 6 6 Site / tech transfer Pipeline 2 2 4 Total 31 13 12 2 58

Total CRAMS - Formulation Pipeline

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Shasun UK Business

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A year of transition with significant achievement

Reduction is sales value of a major product largely off set by new business wins

and growth in current portfolio

A record year for winning new business (16 new customers added) and Two

products graduated from phase 3 to launch

Open proposal data base at a record high £29.9M

Strong safety and environmental performance

Strong quality performance (successful MHRA audit October 2013)

Strong levels of customer satisfaction and repeat business

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Proposal Databse

PC / Phase I Phase II Phase III Launch / Fine Chem

Total

Lab 15 1 5 7 28

Pilot Plant 12 1 5 8 26

Main Plant 3 2 3 23 31

Total 30 4 13 38 85

Total value of open proposals = £29.9M

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Product Pipeline

10 10 9

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Phase I Phase II Phase III Launch

Graduation of two products to Launch Capture of one in Phase III

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Strategic Path Plan

Controlled drugs – One product added to portfolio, proposals issued for others

Potent compounds – EU big pharma approved site for supply

Technology – Working with Durham, Newcastle, Dundee and Leeds Universities

New major customer for CRAMS for 4 products and US Mid size Pharma –

Phase 3 project secured

Huperzine – Progress on process improvement and market understanding

UK technology company – Exclusive supply established with 5 year term

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SPSL revenue growth plan

Shasun Financial

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Shasun –Sales

Sales Product (Rs laks) Qtr 3 FY14 Qtr 3 FY13 Growth 9M FY14 9M FY13 Growth % of Business API 17,282 13,867 25% 44,168 39,319 12% 54.5%

CRAMS India 5,615 4,521 24% 15,916 13,595 17% 19.6%CRAMS - API 642 725 -12% 3,016 3,048 -1% 3.7%CRAMS - Formulation 4,974 3,795 31% 12,900 10,547 22% 15.9%Domestic - Formulation 148 519 0.6%

Bio Tech 97 129 -25% 252 423 -40% 0.3%SPL - TOTAL 23,143 18,517 25% 60,855 53,337 14% 75.0%

SPSL UK -CRAMS 7,795 7,192 8% 20,254 23,209 -13% 25.0%TOTAL 30,938 25,709 20% 81,108 76,545 6% 100.0%

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SPL India Financial Qtr 3 FY 14 and YTD Dec 13

SPL Standalone (Rs. Lakh) Q3 FY14 Q3 FY13 Growth 9M FY14 9M FY13 Growth

Sales & operating revenue 24,924 19,930 25% 64,912 57,776 12%

Rawmaterial cost 13,750 12,752 36,144 35,534

Contribution 11,174 7,178 56% 28,768 22,242 29%

Contribution % of sales 45% 36% 44% 38%

Operations cost 7,792 5,963 21,411 16,937

EBITDA 3,382 1,216 178% 7,356 5,306 39%EBITDA % 14% 6% 11% 9%

PBT 1,004 112 794% 1,387 1,781 -22%

Tax -7 -177 (1030) 180

Profit After Tax 1,012 289 250% 2,417 1,600 51%

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SPSL UK Financial Qtr3 FY14 and YTD Dec 13

SPSL UK Standalone (GBP 000) Q3 FY14 Q3 FY13 Growth 9M FY14 9M FY13 Growth

Sales & operating revenue 7,815 8,343 -6% 22,405 26,731 -16%

Rawmaterial cost 1,774 1,507 5,486 5,465

Contribution 6,041 6,836 16,919 21,266

Contribution % of sales 77% 82% 76% 80%

Operations cost 5,023 5,121 14,750 15,138

EBITDA 1,018 1,715 -41% 2,169 6,128 -65%

EBITDA % 13% 21% 10% 23%

PBT 46 769 -590 3,180

Tax -386 - -386 -

Profit After Tax 432 769 -204 3,180

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Consolidated Financial Qtr 3 and YTD Dec 13

Consolidated (Rs. Lakh) Q3 FY14 Q3 FY13 Growth 9M FY14 9M FY13 Growth

Sales & operating revenue 33,135 27,362 21% 86,811 81,556 6%

Rawmaterial cost 16,081 14,049 41,993 39,842

Contribution 17,054 13,313 44,818 41,713

Contribution % of sales 51% 49% 52% 51%

Operations cost 12,637 10,829 35,387 31,498

EBITDA 4,416 2,484 78% 9,430 10,216 -8%

EBITDA % 13% 9% 11% 13%

PBT 1,295 644 949 4,159

Tax -8 -177 -1,031 180

Profit After Tax 1,303 821 59% 1,980 3,979 -50%

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Consistency Financial YTD Dec 13

Consolidated (Rs. Lakh) Q1 FY14 Q2 FY14 Q3 FY14 9M FY14Sales & operating revenue 23,607 30,069 33,135 86,811 Growth% 27% 10%Rawmaterial cost 12,366 13,546 16,081 41,993 Contribution 11,241 16,523 17,054 44,818 Contribution % of sales 48% 55% 51% 52%Operations cost 10,518 12,232 12,637 35,387 EBITDA 723 4,291 4,416 9,430 EBITDA % 3% 14% 13% 11%

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Major Projects

• New Plant for SEVELAMER

• Green field project in Vizag

• Creation of new production block for New Products

• Formulation capacity expansion

• Existing products capacity expansion in line with sales

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Consolidated Funding YTD Dec 13

Funding as on 31.12.2013 Rs laks SPL India SPSL UK Total Term loan 21,964 8,092 30,056 Working capital 31,402 7,353 38,754 Cash in hand (1,289) (256) (1,544)Total Borrowings 52,077 15,189 67,267 Networth 30,162 Debt Equity Ratio 2.23

INVESTING FOR GROWTH

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