Presentation

© 2013. Arseus. All rights reserved.

Marieke Palstra, IR Milan, 23 May 2014

1

Pharmaceutical compounding 1,479 FTE € 335 million

Medical ICT solutions 331 FTE € 43 million

Developer and producer of innovative healthcare devices 83 FTE € 8 million

Our markets

2

Founded 2007

Headquarters Rotterdam (NL)

Waregem (BE)

CEO Ger van Jeveren

CFO Jan Peeters

Turnover 2013 € 386 million

Countries 30

FTE 1,986

A strong market with high growth potential

3

Arseus benefits from key market drivers …

… that provide significant potential for long term organic growth

Professional healthcare

market

Non-cyclical industry

Growing healthcare expenditure

Technological innovation

Ageing population

Focus on aesthetics

Increasing public healthcare awareness

4

Arseus House of Success

Operational Excellence

Continuous Strengthening

of Positions

Own Brands/ Innovations

Buy-and-Build Strategy

Added-Value Solutions

Buy-and-build strategy

5

• Julie/Owandy (France)

• Tamda (Czech)

• Unikem (Denmark)

2008

• Gallipot (USA) • DEG (Brazil) • Devroe Instruments

(Belgium)

2010

• Duo-Med (Belgium)

2009

• Pharma Nostra (Brazil)

• Pharma-Cosmetic (Poland)

• Pharma Assist (Netherlands)

• CMS (Belgium)

2011

• Florien (Brazil) • Four compounding pharmacies

(Colombia) • Orbus Pharma (Colombia) • Galfarm (Poland) • ApodanNordic

PharmaPackaging (Denmark) • B&B Pharmaceuticals (USA)

2012

• Freedom Pharmaceuticals (USA)

• HealthConnect (Belgium)

Alternate (Brazil)

2013

Focus on own brands and

innovations

6

2007

45% 55%

Distributions

Arseus brands

90%

10%

Distributions

Arseus brands

2013

Fagron

FAGRON

R&D SCIENTIFIC

PHARMACEUTICAL

COMPOUNDING COMPANY

Fagron

• Founded in 1990 by Ger van Jeveren

• Started in 1 country with 1 employee and 1 product

• Currently global market leader and active in 30

countries worldwide

• 1,446 employees, including more than 160

pharmacists

• Turnover of € 335 million in 2013

Ger van Jeveren

Founder & CEO

Specialty

• Muscle relaxant

• API: Baclofen (patent holder Novartis)

• Medication: Lioresal

Generic

• Baclofen out of patent

• Numerous suppliers

Pharmaceutical Compounding

• Baclofen 1mg/ml solution for pediatric use

developed by Fagron or compounding

pharmacist

• No solutions commercially available

When you go the Pharmacy?

What is pharmaceutical compounding?

• Formulations developed by Fagron and/or compounding pharmacists

based on APIs which are out of patent

• Tailor-made medication

• Alternative dosage forms

• Alternative dosage strength

• Combination therapy

• Compounded in community and hospital pharmacies or by Fagron,

based on a pharmaceutical formulation

Key drivers of pharmaceutical compounding

More individualised

approach

Tailor-made

Less side effects

Drug shortages

Discontinued drugs

High-quality and cost

effective alternative

Unique selling point of

the pharmacist

Increased awareness

through internet

New and unavailable

therapeutic needs

Pharmacist

Compounding markets

Brazil

• 120,000 pharmacists

• 32,000 pharmacies

• 7,200 compounding facilities

• US$ 4 billion market (est.)

Compounding:

• Way of life, part of Brazilian culture

• Pharmaceutical specialisation at

University level

• Regulatory: standardised and

implemented

• Innovative (transdermal application)

• Growing market

United States

• 274,000 pharmacists

• 67,000 pharmacies

• 4,500 compounding facilities

• US$ 4 billion market (est.)

Compounding:

• Embedded in society and culture

• Pharmaceutical specialisation at

University level

• Regulatory: standardised and

implemented, but in transition

• Innovative (vehicles)

• Growing market

Europe

• 400,000 pharmacists

• 155,000 pharmacies

• 10,000 compounding facilities

• US$ 2 billion market (est.)

Compounding:

• Not embedded

• Less important at University and

pharmacy education

• Regulatory: not-standardised and not

implemented

• Traditional

• Growing market

Strategy

Optimise

and Innovate

Compounding

Mission

• We are a R&D Scientific Pharmaceutical

Compounding Company that wants to optimise

and innovate compounding in order to widen the

therapeutic scope of the prescriber, to enable tailor-

made pharmaceutical care

• By doing so, we are supporting the unique selling

point of the pharmacist and improve

the quality of life of the patient

Compounding

Result driven

Values

Customer is

number 1

Behave as a global

market leader

Speed of execution Innovative

Entrepreneurial

Win-Win-Win Strategy

(Hospital)

Pharmacists

Patients

Prescribers

Fagron Organisation

Executive Committee

Fagron Group

Constantijn van Rietschoten (43) Marketing Innovation & Global Business

Development

Michaël Hillaert (35) Area Manager Germany, Poland, Nordic, France

and Belgium

Rafael Padilla (34) Area Manager South America, Italy and Iberica

Jake Jackson (32) President North America

Ger van Jeveren (52) Chairman

Jan Peeters (46) Finance

Karin de Jong (35) Controlling

Erik Hoppenbrouwer (48) Operations

René Clavaux (45) Information Management

Fagron

Iberica

Fagron

Italy

Fagron

Czech

Republic

Fagron

Germany

Fagron

UK

Fagron

Colombia

Fagron

France

Fagron

Nordic

Fagron

Nether-

lands

Fagron

Poland

Fagron

Argentina

Fagron

USA

Fagron

Belgium

Fagron

Brazil

Fagron

China

Fagron

Australia

Sales Fagron

137 151

179

243

290

335

2008 2009 2010 2011 2012 2013

145%

Organic and total turnover growth at constant exchange rates

9,4%

5,9% 7,2% 6,5%

10,9%

13,7%

24,2%

10,5%

18,3%

35,8%

21,8% 20,3%

0%

5%

10%

15%

20%

25%

30%

35%

40%

2008 2009 2010 2011 2012 2013

Total growth

Organic growth

Geographical Split

72,4%

31,6%

Sales 2011

Europe Americas

60,3%

39,7%

Sales 2013

67,0%

33,0%

Sales 2012

REBITDA Fagron

21,0 24,4

28,1

36,0

49,5

64,4

85,0

2007 2008 2009 2010 2011 2012 2013

19.1%

18,6%

20,1%

20.4%

22,2%

25,4%

17.8%

Business Model

FCS

Concepts

Equipment & Supplies

Pharmaceutical Raw Materials

Pharmaceutical Raw Materials

Business Model

Pharmaceutical Raw Materials

• Amino acids

• Antibiotics

• Cortico steroids

• Excipients

• Extracts

• Hormones

• Nutraceuticals

• Opiates

• Vitamins

• Alcohol and flammable products

Equipment & Supplies

Business Model

Equipment & Supplies

• Ointment mills

• Printed Matters

• Packaging

• Capsule fillers

Concepts

Business Model

Concepts

• Fagron Advanced Derma

• SyrSpend® SF Superior Suspension

Technology

• Fagron CapsiCards® System

• Fagron Trademark

• Fagron PharmaWhite

• KID concept

• Semi-finished products

• Formulations for compounding

• Selective digestive decontamination

• Bio-identical hormone replacement

therapy

FCS

Business Model

Fagron Compounding Services

• Parenteralia

• Sterile

• Oncology

• Intravitreal injections

• CADD medication cassettes

• Orals with hazardous drugs

• Prefilled syringes

• Irrigations with medication

• Easypumps

• Methotrexate formulations

Fagron University

Fagron Academy

Fagron Bookstore

Fagron Compounding Articles

Pharmaceutical Compounding Science

Fagron Personalisation

Fagron Development

Fagron Quality & Documentation

R&D

Fagron Realisation

Fagron Innovations

Selective Digestive tract Decontamination

A suspension, mouth pasta and suppositories containing:

• Tobramycin

• Colistin

• Amphotericin

Applied in ICU-patients with an expected duration of intubation >48

hours

Why SDD?

SDD is the most extensively

investigated intervention on the ICU

Fagron is the only supplier of a GMP

produced, ready-to-use, analysed

product containing a guaranteed

content of all three antibiotics

What are the benefits?

• Lower airway infections occur in 10-

50% of critically ill patients requiring

mechanical ventilation

SDD reduces the number of

infections by 65%

• The attributable mortality of the

infections is estimated between

20-30%

SDD reduces mortality by 13-20%

Photo dynamic therapy with 5-ALA

• Amino Levulinic Acid

• 3 gram/tube

• € 223,04 each tube

How does it work?

Actinic Keratosis

Morbus Bowen

BCC Light with sufficient energy and wavelength matching

absorption spectrum of the photosensitizer can activate

a photochemical reaction in the treatment of skin

cancer

What are the benefits?

• Treatment is more efficient and more

patient friendly:

Photo dynamic therapy with 5-ALA

enables polyclinic treatment

instead of 2-3 days hospitalization

Unique collaboration with hospitals

• Adapted in current treatment protocols

• Object for dermatological research

• New Insights into Photodynamic Therapy Using Porphyrin Precursors

Fagron the global number 1 in pharmaceutical compounding

© 2013. Arseus. All rights reserved.

Corilus

Corilus

Focus on total ICT-solutions for medical professionals

42

GP’s

Care teams Family care

Tele-

monitoring

Hospitals Specialists Dentists

GP guard

centers

Pharmacies

Patients

customers

Elderly homes

GPs and pharmacies

Ambulant care providers

32,700 customers

Good interaction with medical care providers

& government

110 developers

Quick response & deployment

43

Corilus

Company

• CEO: Dirk van Lerberghe

• FTE: 302 (incl. 96 software developers, excl. 25 off-shore developers)

• Own brands (as % of sales): 80%

• Eight locations in Belgium, Netherlands and France

Products

• Total ICT-solutions, developed in-house, for a wide range of medical and

paramedical professionals

Strategy

• Further strengthening the leading market position in Belgium, the

Netherlands and France through organic growth and acquisitions

Sales

26,7 26,2 28,8

31,1 34,3

38,0

43,4

2007 2008 2009 2010 2011 2012 2013

44

62,5%

REBITDA

margin

29,7% 29.6% 29.4% 29.5% 28.1% 25.1% 27.5%

Geographical Split

83,5%

0,4% 11,1%

Sales 2011

BelgiumNetherlandsFrance

92,2%

5,5% 2,3%

Sales 2013

90,8%

6,8%

2,4%

Sales 2012

45

Customer growth

46

12.000 12.000 12.000 12.000 14.000 14.900

19.365

460 420

7.582 8.723

10.117 11.503

13.374

2007 2008 2009 2010 2011 2012 2013

International

Corilus BE

Business model

47

Software

Training

Premium maintenance services

Hardware & Consumables

Healthcare Consulting

Ambulant care providers

1

5600

Ambulant

nurses

Number 1 or 2 in each segment

48

GP’s

Care teams Family care

Tele-

monitoring

Hospitals Specialists Dentists

GP guard

centers

Pharmacies

Patients

customers

Elderly homes

2

2600

Physio’s

1

+ 3000

GP’s

1

+ 60

Hospitals

1

+ 500

Specialists

1

+ 2300

Pharmacies

1

16 GP

guards

1

1200

Elderly

homes

1

+ 2500

Connections with Ebox

1

+ 2000

Dentists

Ambulant care providers

Elderly homes

GP’s

Creating value by data integration

49

Care teams Family care

Tele-

monitoring

Hospitals Specialists Dentists

Patients

customers

Pharmacies

GPs and pharmacies

GP guard

centers

Financial highlights 2013

Sales

51

304

355 391

424

492

547

338 386

0

100

200

300

400

500

600

2007 2008 2009 2010 2011 2012 2012 2013

80% 14%

1) The income statement of 2012 is resetated for the application of IFRS 5 and IAS 19 Revised.

Revised 1)

Gross Margin

52

143 166

186 202

241 272

189

231

0

50

100

150

200

250

300

350

400

450

2007 2008 2009 2010 2011 2012 2012 2013

90%

47.0% 46.7% 47.5% 47.6% 49.2% 49.6%

22%

2) The income statement of 2012 is resetated for the application of IFRS 5 and IAS 19 Revised.

Revised 2)

56.0% 59.7%

REBITDA

53

41,4 47,6

52,7 60,4

72,9

87,4

75,8

98,0

0

10

20

30

40

50

60

70

80

90

100

110

2007 2008 2009 2010 2011 2012 2012 2013

111% 29%

3) The income statement of 2012 is resetated for the application of IFRS 5 and IAS 19 Revised.

Revised 3)

EBIT

54

26,4 30,0 30,5

36,0

46,3

58,1 53,8

73,9

0

10

20

30

40

50

60

70

80

2007 2008 2009 2010 2011 2012 2012 2013

120% 37%

4) The income statement of 2012 is resetated for the application of IFRS 5 and IAS 19 Revised.

Revised 4)

Net Financial Debt

55

51

104 114

166 189

233

289

51

98 106

152 178

223

265

0

50

100

150

200

250

300

350

2007 2008 2009 2010 2011 2012 2013

Net financial debt

Adj. net financial debt

Net Financial Debt – S1 en S2

56

107 91

124 141

193

237

327

51

104 114

166 189

233

289

0

50

100

150

200

250

300

350

2007 2008 2009 2010 2011 2012 2013

S1

S2

Financial Covenant

57

1,99

2,58 2,47

2,96 3,06 3,14

1,33

2,25 2,19

2,49 2,48

2,64 2,61

0,0

0,5

1,0

1,5

2,0

2,5

3,0

3,5

2007 2008 2009 2010 2011 2012 2013

S1

S2

3.25

59,3 47,5

417,9 400,6

32,3 28,3

1,9 15,8

51,3 33,0 40,3

0

100

200

300

400

500

600

Dec 2012 Dec 2013

Assets/Liabilitiesheld for sale

OWC

Other fixed assets

Deferred tax assets

Intangible assets

Tangibles

58

Balance sheet: Assets

58

5) Excluding net debt for discontinued operations.

5)

245,4

155,2

8,3

13,5

2,5

4,5

233,1

289,2

3,7 2,5

69,6 100,7

0

100

200

300

400

500

600

Dec 2012 Dec 2013

Other WC

Financial instruments

Net financial debt

Deferred tax

Provisions

Equity

59

Balance sheet: Liabilities

59

Outlook 2014

Outlook 2014

61

Arseus expects a turnover from continuing operations of

at least € 480 million with an REBITDA margin from

continuing operations of 26% in 2014

Thank You