STRATEGY AND GROWTH OPPORTUNITES IN … AND GROWTH OPPORTUNITES IN GENERICS Luc Slegers, EVP...

CAPITAL MARKETS DAY OCTOBER 5, 2016

STRATEGY AND GROWTH OPPORTUNITES IN GENERICS Luc Slegers, EVP Generics

Page STADA Capital Markets Day • October 5, 2016

GENERAL INFORMATION

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By making use of this document the reader acknowledges and agrees to the following:

We accept no liability arising from the use of this document.

STADA Arzneimittel AG, Bad Vilbel (hereinafter “STADA”), has made every effort to make sure that this document contains correct and up-to-date information. STADA accepts no responsibility for and makes no guarantee whatsoever in respect of currentness, accuracy and completeness of the information and assumes no obligation to update, complete or correct this information.

The anticipated opportunities and risks to STADA’s activities have been described in detail in the Executive Board’s management reports in the annual reports. Current possible opportunities and risks are discussed in the respective interim report.

STADA’s performance indicators are partly influenced by one-time special effects and/or effects not arising from the operating business. Disclosure of key figures adjusted for these effects (so called “pro forma” key figures) by STADA is only to provide a supplement to the recorded IFRS key figures for a transparent comparison to a relevant period from the previous year.

All text, pictures, trademarks, and other information contained in this document are subject to the copyright of STADA or subject to rights acquired from third parties. Trademark protection may apply even for preparations not indicated as trademarks. This document may not be reproduced in whole or in part without the express written consent of STADA.

Any disputes arising out of or in connection with the content of this document, insofar as they are directed against STADA, shall be subject to German law, without prejudice to mandatory provisions of foreign law. The place of jurisdiction is Frankfurt am Main to the extent legally permissible.


FORWARD-LOOKING STATEMENTS

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This STADA Arzneimittel AG (hereinafter "STADA") presentation contains certain statements regarding future events that are based on the current expectations, estimates and forecasts on the part of the company management of STADA as well as other currently available information. They imply various known and unknown risks and uncertainties, which may result in actual earnings, the business, financial and earnings situation, growth or performance to be materially different from the estimates expressed or implied in the forward-looking statements. Statements with respect to the future are characterized by the use of words such as “expect”, “intend”, “plan”, “anticipate”, “believe”, “estimate” and similar terms. STADA is of the opinion that the expectations reflected in forward-looking statements are appropriate; however, it cannot guarantee that these expectations will actually materialize. Risk factors include in particular: The influence of regulation of the pharmaceutical industry; the difficulty in making predictions concerning approvals by the regulatory authorities and other supervisory agencies; the regulatory environment and changes in the health-care policy and in the health care system of various countries; acceptance of and demand for new drugs and new therapies; the results of clinical studies; the influence of competitive products and prices; the availability and costs of the active ingredients used in the production of pharmaceutical products; uncertainty concerning market acceptance when innovative products are introduced, presently being sold or under development; the effect of changes in the customer structure; dependence on strategic alliances; exchange rate and interest rate fluctuations, operating results, as well as other factors detailed in the annual reports and in other Company statements. STADA does not assume any obligation to update these forward-looking statements.

The Executive Board of STADA Arzneimittel AG: Dr. M. Wiedenfels (Chairman), H. Kraft

Page STADA Capital Markets Day • October 5, 2016 4

GENERICS CLEAR STRATEGY FOR CONTINUOUS GROWTH

Continue to grow base business and defend market positions

Expansion in attractive / less regulated markets

Rollout of the biosimilar portfolio

Ongoing efficiency initiatives to sustain attractive margin level

Selective M&A activity in growing markets


GENERICS STRENGTHS AND CHALLENGES

Building on our strengths … o  Solid base business

o  Strong organic growth

o  Full pipeline

o  Expanding into new markets (biosimilars) and niches

o  Expertise in working in a heterogenous environment

…we will master the challenges o  Distinct markets

o  Changing reimbursement policies

o  Price erosion

o  Decreasing number of blockbusters coming off patent

o  Competitive landscape

o  Evolving biosimilar market


GENERICS THE MARKET IS DRIVEN BY HIGH VOLUME GROWTH Generics continue to take an increasing share of the scripts in all markets

Europe: 44% 56% Japan: 14% 26%

Asia / Australia: 42% 48%

Africa / Middle East: 44% 47% Latin America: 55% 71%

US: 59% 82%

Canada: 58% 73%

Generic volume market share 2006 vs. 2015. Source: IMS Health: “Why we need Generic medicines“; 2016.


GENERICS CONTINUE TO BE A GROWTH STORY

62.1 48.5

93.8

5.2

21.3

Source: IMS Health / Market Prognosis & Generic Forecasts / Sales (Local Currency €) converted to €bn using 2015 (end period) exchange rates.

Total market size € 231 bn in 2020e


GENERICS THERAPEUTIC AREAS

Top ten generic therapeutic areas by volume, global

Volume (SU)

15% 10% 5% 0% -5% PPG %

Volume (SU) 2014

PPG 2013-2014

Source: IMS Health: “Why we need Generic medicines“, 2016.


GENERICS STADA‘S TOP 5 GENERIC MARKETS

Growth rates1 (ex-manufacturer sales before discounts) and market positions2

Market Growth CAGR 15-20

Germany Italy Spain Belgium Russia

4.8% 8.4% 7.7% 6.9% 6.9%

Germany

1. Novartis 2. Teva 3. STADA

Italy

1. Teva 2. Mylan 3. Novartis 4. STADA

Spain

1. Cinfa 2. Teva 3. STADA

Belgium

1. STADA 2. Novartis 3. Teva

Russia

1. Sanofi 2. STADA 3. Novartis

STADA‘s sales split regional

STADA occupies leading market positions in key Western and Eastern European generic markets

Benefits from attractive market growth

Trend of increasing generic penetration in STADA’s key markets

1) Source: IMS Generic Forecasts; 2) Source: IMS Health Midas. 3) Incl. Commercial business.


GENERICS FOCUS ON ORGANIC GROWTH – VIEW ON SELECTED REGIONS

UK o  Revitalize the former Genus Pharmaceuticals Ltd. generic business together with the already

existing marketing organization as well as the Group’s pipeline products Argentina o  Recent acquisition of Laboratorio Vannier to use as starting point for further business

activities in Latin America. Vannier is active in less regulated price segments MENA o  Further growth to be expected in MENA region in particular in Saudi Arabia and UAE since

market forecasts for both countries show promising development in both pricing and penetration

Germany o  Reorganization and reallocation of resources (e.g. bundling of German entities) o  Capitalize on strong position in German tenders

Russia o  Activities follow the evolution of the Russian market o  Robust local market with steady growth. Business strongly impacted by the Russian Ruble


GENERICS FUTURE PATENT EXPIRATIONS

Patent expiration in Germany, France, Italy, Spain and UK

Source: IMS Health Midas.

> € 12 bn of sales coming off patent in our key markets by 2019

not including biosimilars

€m


GENERICS FULL PRODUCT PIPELINE

Introduction of more than 2,000 SKUs worldwide 2016-2019

Currently, more than 1,300 ongoing approval procedures covering approx. 150 active pharmaceutical ingredients in over 55 countries worldwide

Development partnerships to further expand pipeline

Planning horizon beyond 2024


GENERICS FULL PRODUCT PIPELINE

Important launches

2018

Efavirenz-Emtricitabine-Tenofovir Fluticasone-Salmeterol Solifenacin EverolimusA Erlotinib

2017

Pregabalin Rosuvastatine Emtricitabine-Tenofovir Dutasteride-Tamsulosin Ezetimibe

2019

Oxymetazoline Bortezomib Vildagliptin-Metformin Vildagliptin Agomelatine


GENERICS BIOSIMILARS STRATEGY – PORTFOLIO EXPANSION

Risk-averse in-licensing approach (e.g. Filgrastim)

Exploiting opportunities with adequate consideration of risks and benefits

Avoidance of high R&D costs – milestone payments backloaded and performance related

2 biosimilars on the market

5 biosimilars in development

SALES €m

2019e ~100


Molecule Brandname Originator Indication Patent

Expiry1 Partner Expected Launch Date2

Pegfilgrastim Neulasta®

Amgen Neutropenia 08/2017 Gedeon Richter 2017

Rituximab MabThera® Roche

Non Hodgkin, Chronic Lymphocytic Leukemia,

Rheumatoid Arthritis, Granulomatosis

expired Gedeon Richter 2019

Teriparatide Forsteo® Lilly Osteoporosis 12/2018 Richter-

Helm 2019

Adalimumab Humira® AbbVie

Rheumatoid Arthritis Ankylosing

Spondylitis, Psoriatric Arthritis, Crohn‘s

Disease, Psoriasis, Colitis Ulcerosa

10/2018 mabXience 2019

Bevacizumab Avastin® Roche

Intestinal, Mammary, Ovarial and Cervical

Carcinoma 12/2019 mabXience 2020

1) Expiry date SPC, including prolongation based on PIP. 2)  Actual launch dates dependent on conclusion of development and regulatory process according to planned timelines.

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GENERICS 5 NEW BIOSIMILARS BY 2020


GENERICS VALUE OF ORIGINATOR PRODUCTS IN EUROPE

Source: IMS Midas; EU 28 (without CY, MT)+ CH + NO + RS + RU.

€m

16

Total Sales 2015

> € 7 bn

Seite STADA Capital Markets Day • October 5, 2016 17

Harmonize portfolio and production – Reduce complexity

Further streamline our generics portfolio and harmonize dossiers

Optimize our hospital portfolio/business

Improve our COGS and supply chain – both own products

and 3rd party manufacturing

Look for niches and attractive therapeutic areas

Foster own-developments (in cooperation with strong partners)

Maximize standardization in production

Focus our sales & marketing, reduce redundant structures

Reallocation of resources

GENERICS SELECTED INITIATIVES TO FURTHER ENHANCE EFFICIENCY AND PROFITABILITY


GENERICS SEGMENT GUIDANCE 2019e

€m

GENERICS

1)  Adjusted for portfolio and currency effects; including commercial business. 2)  Adjusted for special items.

1.261 1.420

2015 2019e

+ ~ € 140 m Volume growth base business / Launches

+ ~ € 100 m Biosimilars

./. ~ € 80 m Price cuts

EBITDA-Margin2 adj. 2015

18.4%

EBITDA-Margin adj. 2019e

~19.0%

CAGR ’15-’19 + ~3%

Sales1


YOUR CONTACT

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STADA Arzneimittel AG

Investor Relations 61118 Bad Vilbel, Germany Telephone: +49 (0) 6101 603-113 Fax: +49 (0) 6101 603-506 E-mail: [email protected]

www.stada.com

Vice President Investor Relations Leslie Isabelle Iltgen

[email protected]

STRATEGY AND GROWTH OPPORTUNITES IN … AND GROWTH OPPORTUNITES IN GENERICS Luc Slegers, EVP...

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