Aqua Pharmaceuticals, LLC Corporate Presentation June 2011 AQUA PHARMACEUTICALS, LLC 1
Company Overview Specialty dermatology pharmaceutical company currently focusing on acquiring, developing and marketing prescription medical dermatology products Founded in 2004 Focus on under or non-promoted, branded dermatology drugs in US Market Commercial infrastructure with track record of success Stable and growing base business with high margins and strong cash flows Sales coverage in all major, high-value targets RoundTable made a controlling investment in June 2010 AQUA PHARMACEUTICALS, LLC 2
Strength in Management Jay Gooding, Co-Founder, Chief Executive Officer 26 years in Dermatology Stiefel Laboratories Sales, Training & Management Healthpoint Manager of Marketing & Product Development Bioglan Vice President of Marketing & Managed Care, Officer Craig Ballaron, Co-Founder, President, Treasurer and Secretary 26 years in Senior Management Ultra Precision President Bioglan - Senior Vice President, Sales & Finance / CFO David H. Crean, Vice President, Corporate Development 18 Years in Specialty Pharmaceuticals Allergan, Inc. Business Development for Dermatology, Neurology and Ophthalmology Allergan, Inc. Project and Portfolio Management, Research & Development Ted W. White, Vice-President, Sales +19 Years in Sales & Marketing Leadership Novartis Managing Director Primary Care, US Group Practice, Cardiovascular Skip Williams, Vice-President, Product Development 19 Years in Specialty Pharmaceuticals Watson Pharmaceuticals Business Development Nephrology, Dermatology, Biologics Accenture, System Software Associates, and Lexis-Nexis Kimberley Forbes-McKean, Vice-President, Research & Development +20 Years in Specialty Pharmaceuticals Dermik / Sanofi-Aventis- Global Development Cutanea Life Sciences and Isolagen, Inc.- CSO/ CTO, Development AQUA PHARMACEUTICALS, LLC 3
RoundTable Healthcare Partners RoundTable provides the experience, know how and capital to consummate a transaction Invested over $250 million in capital over the past year $1.9 billion in private equity buyout funds Fund I - $400 million private equity buyout fund raised in March 2002 Fund II - $500 million private equity buyout fund raised in March 2005 Capital Fund - $200 million subordinated debt investment fund raised in July 2006 Fund III - $600 million private equity buyout fund raised in July 2010 Capital Fund II - $200 million subordinated debt investment fund raised in July 2010 AQUA PHARMACEUTICALS, LLC 4
Dermatology Sector Attractive Macro Characteristics Dermatology represents one of the largest global markets for healthcare $14B+ market (2009) with 5% CAGR Highly diverse sector with overlapping segments (therapeutic, aesthetic, skin care) Market served by multiple, global, US and EU players of varying sizes, with some recent consolidation Big pharma- Sanofi, J&J, GSK, Roche, Bayer Large specialty- Nycomed, Galderma, Valeant, Allergan, Medicis Independents- Graceway, Obagi, SkinMedica, Triax, many others Fragmented nature of market comprised of numerous dispersed specialty pharmaceuticals presenting attractive consolidation opportunity Significant potential to exploit synergies acrss products, distribution, sales and marketing infrastructures Historically not a focus area for large pharma due to sub threshold blockbuster indications (i.e., low hanging fruit) Growth Drivers Source: 2011 BMO Capital Markets.Supported by Macro and Clinical Growth Drivers Widespread need with 1 out of every 3 people suffering from a dermatologic condition Increasing demand from aging populations treating accumulated dermatological conditions and co-morbidities Overlapping drug development opportunities across other therapeutic categories Major physician preference driven by life cycle management, product bundling, repeat aesthetic procedures Aesthetics resilience to macro economic trends: out of pocket payments, not subject to Medicare/ Healthcare reform AQUA PHARMACEUTICALS 5
$131 $115 $113 $99 $94 $84 $78 $74 $59 $58 $47 $47 $44 $42 $185 $165 $156 $223 $296 $280 $259 Revenue $USD MM $345 $340 $338 $410 $452 $448 $632 $872 $950 Fragmented Market in U.S. $1,000 US Dermatology Top 30 Players $900 $800 $700 $600 $500 $400 $300 $200 $100 $- 2010 IMS Health, Dermatology All Topical, Tetracycline Antibiotics, Isotretinoins AQUA PHARMACEUTICALS 6
Dermatology Segments Aqua has leading branded prescription drugs in four therapeutic categories including acne, steroid-responsive dermatoses, seborrheic dermatitis and actinic keratosis Acne market represents largest segment of overall dermatology market Sales of prescription and over-the-counter acne medications generate approximately $5 billion annually 15-20% of all consultations in dermatology related to acne Topical corticosteroid market is estimated at $500+ million Indications include atopic dermatitis, contact dermatitis and psoriasis Seborrheic dermatitis market Affects 1-3% of the immunocompetent adults 1.3MM uses in 2010 (OTC, Rx) AK market (actinic keratoses) pre-cancer skin condition: estimated 10 million people affected in the U.S. Estimated that 10% of AK advances to a cancerous state Favorable market dynamics with aging population AQUA PHARMACEUTICALS, LLC 7
Marketed Products Product Active Addressable Market Monodox Doxycycline, Oral Acne Cordran Flurandrenolide, topical Steroid-responsive Dermatoses Xolegel Ketoconazole, topical Seborrheic dermatitis Fluoroplex 5-Fluorouracil, topical Actinic Keratoses AQUA PHARMACEUTICALS, LLC 8
Corporate Growth Strategy Value creation is fueled through three-pronged approach Maximize Current Products Growth and Profit Acquire Companies and new products to expand product mix and core competencies Organic Growth Facilitate long term growth through R&D Pipeline and Product Development Product Development Corporate & Business Development AQUA PHARMACEUTICALS, LLC 9
Growing organizational capabilities Positioned for Future Growth Key Success Factors: Strategy, People and Execution
What s in our Sweet Spot? Aqua is looking for assets to add to its existing portfolio Dermatology assets for North America (US & Canada) Therapeutic, Aesthetic, Physician Dispensed, OTC No DESI products drug (505(b)(1), 505(b)(2) or device (PMA, 510K) Avoid capital equipment or box plug-in technology Brands, not generics Marketed assets with revenue and development stage assets for longer term growth Open to Corporate M&A to add greater capabilities Assets with patents or market/ regulatory exclusivity AQUA PHARMACEUTICALS, LLC 11
For corporate and business development opportunities, please contact: David H. Crean VP, Corporate Development Aqua Pharmaceuticals, LLC 158 West Gay Street Suite 310 West Chester, PA 19380 610-644-7000 www.aquapharm.com davidcrean@aquapharm.com AQUA PHARMACEUTICALS, LLC 12