PR98760

TAIPEI, Taiwan, Nov. 11, 2022 /PRNewswire=KYODO JBN/ --

Lotus Pharmaceutical (1795: TT), a multinational pharmaceutical company, today

reported its financial results for the third quarter ended 30 September 2022.

Third quarter financial highlights:

- Third quarter 2022 is the best quarter ever in the Company's history, majorly

driven by the successful launch of Lenalidomide in the US – the biggest launch

in Lotus history so far. Basic EPS for the first nine months ended 30 September

2022 totaled 10.96 TWD, setting the course for the Company to achieve another

record year in 2022.

- Consolidated net sales were 5,389 million TWD, representing a growth of 85.2%

over the last quarter and 76.3% versus prior year period.

      - Export Business was the main growth driver, contributed by the

successful launch of Lenalidomide (generic of Revlimid) in the US, as well as

the first delivery to Brazil, the largest market in Latin America. Sales from

Export increased 245% compared to last quarter and 183% compared to same period

last year.

      - Asian Business continued to grow for the third consecutive quarter,

3.2% over last quarter, also 10.8% over the same period last year. Key brands

in major markets, including Korea, Taiwan, and Thailand, continued the growth

momentum.

- Gross margin rose to 67.9%, driven by product mix with higher contribution

from more profitable export oncology products during the quarter.

Comparing to the prior year, operating profits grew by 353%, to 2,641 TWD

million, with 49.0% operating margin for the quarter, mainly driven by higher

gross margin.

- Historic high third quarter EPS of 7.97 TWD and first 9 months basic EPS of

10.96 TWD.

Robert Wessman, Chairman of Lotus said: "I am very happy to share such a record

setting quarter that will most certainly lead to the most profitable year in

Lotus's history. With Lenalidomide launch in the US, the largest market in the

world and the first delivery to Brazil, the largest market in South America,

Lotus has achieved major milestones of its transformation to a global oncology

player. I am confident that the team will continue to set records with further

achievements driving sustainable growth."

Petar Vazharov, Chief Executive Officer of Lotus, continued to indicate: "Lotus

will continue to build US pipeline and the recent tentative approval of the

generic Midostaurin softgel capsules from the US FDA is a testimony to that.

Lotus believes that this is a potential first-to-file opportunity and expects

to launch the generic Midostaurin softgel capsules subject to the intellectual

property clearance in the US. Another important milestone occurred during the

quarter is Lenalidomide filing in Japan, and similar to the US, we are ramping

up a robust pipeline of products for Japan market based on strategic

partnership.

Lotus's success during recent years provides necessary financial resources to

continue investing in new products, new partnerships, entering new markets and,

at the same time, provide returns to our shareholders. We believe this is the

beginning of a new chapter of Lotus's growth story."

Operational results for the third quarter 2022

Total net sales were 5,389 million TWD, comparing to 3,058 million TWD for the

same period last year, representing an increase of 76.3%, or 78.9% excluding

the unfavorable impact on foreign exchange between the Korean Won and New

Taiwan Dollar.

Gross margin was 67.9% for the quarter, significantly higher than 45.3% for the

same period 2021 and 47.4% in the previous quarter. The difference was mainly

explained by more revenues coming from more profitable export segment.

R&D expenses was 203 million TWD for the three months ended 30 September 2022,

a 66.6% increase compared to a year before due to the cessation of one R&D

project and thus recognizing the impairment charge of approximately 93 million

TWD, slightly offset by less R&D spending during the quarter.

SG&A expenses saw an increase of 19.7% compared to the same prior year period,

mostly driven by higher amortization of the newly-acquired Cialis and Evista

brands in Taiwan and higher personnel expenses with more headcounts to expand

the business.

The Company delivered a historical high operating margin of 49.0% for the

quarter, versus 19.1% for the comparable period last year and 16.8% for the

prior quarter, resulted from the improved gross margin while maintaining a

similar level of operating expenses.

During the quarter, the Company generated steadily cash inflow from operations

and had net inflow of 1,123 million TWD from operations before tax and

interest. Its net gearing has gone down due to increasing profitability. The

Company's net debt to LTM EBITDA ratio landed at 1.23x as of the third quarter

2022, compared to 1.45x as of the same period last year.

Exceeding the expectation, the Company reported an EPS of 7.97 TWD for the

third quarter 2022 and 10.96 TWD for the first nine months ended 30 September

2022.

Pipeline and business development update

During the third quarter 2022, Lotus made several achievements to further

expand the addressable markets with more diversified portfolio through internal

R&D as well in-licensing business development deals. 15 submissions were made

in total, including Lenalidomide in Japan and Tofacitinib, indicated for

rheumatoid arthritis (RA), in South Africa via local partner. 24 approvals were

granted during the quarter, including Alyssa and the approval of Pomalidomide

in Taiwan.

- As of the third quarter 2022, the Company has 95 countries covered in the

world for its Lenalidomide and made its Lenalidomide now available in 43

countries around the world.

- Addressable markets are also continuously expanding for Lotus's other leading

portfolio globally – more than 50 countries for its Gefitinib, Vinorelbine, and

Sunitinib, more than 30 countries for its Enzalutamide and Pazopanib, and 17

more for its Pomalidomide.

- Among the second-wave oncology portfolio, the Company has launched its

Enzalutamide in 4 countries, including the newly-approved Taiwan, and added

Israel as the 22nd market for its Vinorelbine around the world.

Income statement

In TWD million, except EPS        Q3'22     Q3'21    YoY %

Net Sales                         5,389     3,058    76.3 %

Cost of Goods                     1,732     1,673    3.5 %

Gross Profits                     3,657     1,385    164.1 %

Gross Margin %                    67.9 %    45.3 %

   R&D                            203       122      66.6 %

   SG&A                           813       680      19.7 %

Operating Expenses                1,016     801      26.8 %

Operating Income                  2,641     583      352.8 %

OP Margin %                       49.0 %    19.1 %

Non-Operating Income (Expenses)   (11)     (111)    (90.1 %)

Income Before Tax                 2,630     473      456.4 %

Net Income                        2,079     348      497.0 %

Basic EPS (TWD)                   7.97      1.34     494.8 %

Conference call and earnings material

Lotus Pharmaceutical will host a live audio conference in Mandarin at 2pm, 15

November and conduct a conference call at 4pm, 15 November in English to review

the Company's financial results for the third quarter 2022. The information of

earnings call is available at the following address on the Company's website:

https://www.lotuspharm.com/.

About Lotus

Founded in 1966, Lotus (1795: TT) now is the largest pharmaceutical company in

Taiwan with high-value generic products covering CNS, CVS, women health, and

anti-obesity drugs in tablets and hard/softgel capsule with a special focus on

oral oncology for global markets.

By leveraging a best-in-class R&D and manufacturing platform in Asia, Lotus

aims to benefit patients, its employees and stakeholders. Furthermore, Lotus

can reach nearly every global market with its high value pipeline through its

direct markets, currently encompassing Taiwan, Korea, Thailand, Vietnam,

Singapore, Hong Kong, Malaysia, Philippines, and China, or via alliances with

top-tier pharma companies based on its industry-leading infrastructure

certified by most of the advanced regulatory authorities around the world,

including US FDA, EU EMA, Japan PDMA, China FDA, and Brazil ANVISA.

Investor enquiries:

Angela Luan, Investor Relations Director

+886 2 2700 5908

investor@lotuspharm.com

Media enquiries:

Lara Omarsdottir, Public Relations

+354 659 9166

media@aztiq.com

lara@aztiq.is

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Source: Lotus Pharmaceutical