Biostar Pharmaceuticals Inc · OTC:BSPM
Biostar Pharmaceuticals — Investor Presentation (February 2011)
22 slides from Biostar Pharmaceuticals's investor presentation, Feb 18, 2011
Slide 1: Biostar Pharmaceuticals
BIOSTAR PHARMACEUTICALS NASDAQ GM: BSPM lll Biostar February 2011
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Cautionary Note re: Forward Looking Statements This presentation includes statements that are “forward-looking statements.” While management has based any forward-looking statements contained in the presentation on its current expectations, the information on which such ex
Slide 3: NASDAQ GM: BSPM
NASDAQ GM: BSPM Price (2/16/11): $2.50 Fully Diluted Shares Outstanding (at 09/30/10): 27.4M Market Cap (2/16/11): $67.2M Q3 2010 Revenue (unaudited): $20.2M 429.7% Q3 2010 Adjusted Non-GAAP Net Income (unaudited)* $3.5M +11.9% Q3 2010 Adjusted Non-GAAP EPS (Diluted)* (unaudited) $0.13 - 2009 Revenu
Slide 4: Company Overview
a COMPANY OVERVIEW * Based in Xi’an, China, BSPM develops, manufactures and markets traditional Chinese medicines, generic pharmaceuticals and medical nutrients for a variety of diseases and conditions. © Proven market leadership - Xin-Aoxing capsule, a leading SFDA approved OTC capsule treating Hep
Slide 5: Growth Strategy
a GROWTH STRATEGY * Grow rural retail distribution by 60%+ per year * Develop new OTC and prescription products Increase usage in new and existing markets Invest 20%-25% of sales in marketing to build brand awareness and drive incremental growth Vertically integrated model brings quality control for
Slide 6: Key Products
KEY PRODU o Gross Margin SFDA Name prices Indications , usp$ (032010) Classification Xin Aoxing Oleanolic Acid 64.0% $129 84.3% Acute and chronic hepatitis B orc Capsule Ganwang _ ns ea Prevents and treats the common cold one Compound and influenza. Tiangi ‘An OTCtraditional Chinese medicine Dysmeno
Slide 7: Market Opportunity
MARKET OPPORTUNITY * China pharmaceutical industry projected to grow 20%+ in 2010 to approximately $182 billion.* * Fragmented industry — over 3,600 private pharma companies, many of which are undercapitalized; provides opportunity for BSPM to gain market share.** © Significant potential to sell mor
Slide 8: China's New Healthcare Reform Plan
a CHINA’S NEW HEALTHCARE REFORM PLAN ¢ Chinese government is investing $124 billion for a national healthcare reform for 2009-2011 * Includes $5.6 billion over 3 years for “New rural medical care cooperative program”, with goal of full medical coverage for all 900 million rural citizens by 2011 ¢ Sh
Slide 9: China's Hepatitis Prevalence — Very High
A CHINA'S HEPATITIS PREVALENCE — VERY HIGH Geographic Distribution of Hepatitis B Virus China has more than 10% prevalence of HBV Source: US CDC
Slide 10: A Leading OTC Drug Approved in China for HBV
a A LEADING OTC DRUG APPROVED IN CHINA FOR HBV io @ * Adisease caused by the hepatitis B virus (HBV) which infects and inflames the liver, causing life-long side effects. * Approximately 130 million or 10% of the Chinese population has Hepatitis B. Worldwide infection rate has doubled since 2000. *
Slide 11: Affordable and Effective Drug for Hepatitis B
A AFFORDABLE AND EFFECTIVE DRUG FOR HEPATITIS B Xin Aoxing: Compelling value proposition 6-month treatment: $450 for Xin Aoxing vs. $6,000+ for injections Company Treatment Classification Cost per unit [Weenconseior || Interferon. ‘Western: Roche Hepatitis Source: Decision Resources, WiCon, AP, Shaa
Slide 12: Vertically integrated model
f 28Sales |) | Raw Material|| a | |oaitee Covering | Plantetion ais Provinces
Slide 13: Research & Development
ESEARCH & DEVELOPMENT External R&D — Biostar sponsors and owns the IP: °Xianyang Medical Material Institute *Shaanxi University of Science and Technology *Northwest University - College of Life Science Extended Patent Protection for Xin Aoxing: September 16, 2029 30 internal scientists & researchers
Slide 14: New Products Launched in Q2 2010
a NEW PRODUCTS — CHED IN Q2 2010 (Gus * Yizi Capsules - Aids fertility and helps in fetal development during pregnancy. * Tangning Capsules - For treatment of type II diabetes. * Shengjing Capsules - Replenishes kidney function with low price and high efficacy. * Aoxing Ointment-— For skin treatment
Slide 15: Sales & Marketing Strategy
a LES & MARKETING STRATEGY * We are allowed to do mass media advertising for our SFDA approved OTC drugs, while Western drugs are prohibited from advertising their drugs in the PRC * We spent $4 million in advertising for the third quarter of 2010, or 20% of revenue * Working with pharmacies and doc
Slide 16: Multi-Faceted Distribution
ULTI-FACETED DISTRIB City Market * We have penetrated 22 provinces in China * In Q2 2010 alone, we entered 7 new provincial markets, generating $3.3m revenue Rural market * We have penetrated 10,000 rural clinics out of the estimated total of 730,000 in China * Rural market contributed $9.2M sales,
Slide 17: Modern Production Facility
MODERN PRODUCTION FACILITY * BIOSTAR has 4 Good Manufacturing Production (GMP) certified production lines with the potential to expand to an annual production capacity of over $100 million. New line for proprietary Zushima Spray to expand capacity by projected $30 million. * Companies must meet GMP
Slide 18: Gross Profit
Gross Profit Ws sinmton sans ee eg a 8s aA : oie $80.0 | of — = 750% | so soo so9 x 700% sno | 5200 650% so) $159 bea 00% s100 sioo | or 550% soot — a s 200% 2007” 2008 2007” 2008 2009 a3.2009 ” a320%0 Operating Pro (ussinmimon) mugs ussinmnon) ur) ‘60 * oF sis ri re sis Soe vo; @ a 30.0% 19.0% 2 eo
Slide 19: in except for margins & DSO
in except for margins & DSO Cash and cash equivalents Working Capital Accounts Receivable DSO Total Stockholders’ Equity Net cash from operating activities Gross Margins Operating Margins 8.6M 24.1M 145 days 40.9M 5.7M 73.2% 28.3% 36.4M 116 days 53.7M 87M 75.7% 29.8% 19
Slide 20: 2010 Guidance
2010 GUIDANCE Cautionary Note re: Certain Unaudited Preliminary 2010 Year-End Information This presentation below includes certain preliminary unaudited 2010 year-end information. Readers are cautioned that such information is preliminary, has not been audited and is subject to further analysis and
Slide 21: Management Team
MANAGEMENT TEAM Ronghua Wang - Chairman » Founderand CEO since 1997 > rior Senior management with Geological Research Institute and Drugs Research Institute » Named “Top Ten Most Important People” in the Shaanxi pharmaceutical industry 2001 >» Graduate of China's Northwest University, witha Bachelor
Slide 22: Investor Contacts
mM INVESTOR CONTACTS Biostar Pharmaceuticals, Inc. Bill Chen, CFO Phone: +86-138-161-00700 Email: bchen65@gmail.com HC International, Inc. Ted Haberfield, Executive Vice President Phone: +1-760-755-2160 Email: thaberfield@hcinternational.net 22
Biostar Pharmaceuticals — Investor Presentation (February 2011) on 6ix