IR PRESENTATION January 2019
FORWARD-LOOKING STATEMENTS Certain information contained in these materials and to be discussed during this presentation constitute forward-looking information within the meaning of applicable securities laws, including, among others, statements concerning the Company s objectives and strategies to achieve those objectives, sales of the Company s products, the Company s product candidates and the timeline for their development and commercialization, the Company s future financial condition and performance, potential acquisition and licensing transactions, as well as other statements with respect to management s beliefs, plans, estimates, and intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. Such forward-looking information reflect management s current beliefs as of the date hereof and are based on information currently available to Management. Although the forward-looking information contained in these materials and to be discussed during this presentation is based upon what management believes are reasonable assumptions, there can be no assurance that actual results will be consistent with these forward-looking statements. Forward-looking information is based on the Company s estimates and assumptions, and is subject to risks and uncertainties, that could cause actual results to differ materially from such forward-looking information, including those described in the Company s annual information form, management discussion and analysis and other documents filed with Canadian securities regulators, copies of which are available under the Company s profile at www.sedar.com. Except as required by applicable law, the Company undertakes no obligation to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise. 2
NON-IFRS MEASURES The Company reports its financial results in accordance with IFRS. However, we use certain non-ifrs financial measures to assess our Company's performance. We believe these to be useful to management, investors and other financial stakeholders in assessing Crescita's performance from both a financial and operational standpoint. The non-ifrs measure used in this presentation does not have any standardized meaning prescribed by IFRS and is therefore not comparable to similar measures presented by other issuers. This measure should be considered as supplemental in nature and not as a substitute for the related financial information prepared in accordance with IFRS found in our continuous disclosure documents. Adjusted EBITDA is a non-ifrs measure. This term is defined as earnings (loss) from continuing operations before interest, income taxes (recovery), depreciation and amortization, gain on debt renegotiations, net, equity-settled stock-based compensation (SBC), goodwill and intangible assets impairment, accretion on the fair value of inventory, and foreign currency (gains) and losses. Management believes that Adjusted EBITDA is an important measure of operating performance and cash flow and provides useful information to investors as it highlights trends in the underlying business that may not otherwise be apparent when relying solely on IFRS measures. 3
WHY INVEST 1 Company in turnaround and undervalued 2 Significant growth potential in Rx business 3 250+ proprietary formulations & 2 patented technologies 4 Multiple diversified revenue streams 5 Dermatology market expanding with higher demand for innovation 4
CRESCITA AT A GLANCE CRESCITA is a Canadian commercial dermatology company serving the prescription (Rx) & non-prescription (non-rx) markets 3 established skincare brands Strong pipeline of RX product candidates and cosmeceuticals is distributed by Taro Pharmaceuticals Inc. in the U.S. & by Galderma in ROW 2 patented technologies and 250+ proprietary formulations 50,000 sqf manufacturing facility offering CMO services and R&D capabilities Strong sector-specific management team 5
NON-RX SKINCARE PORTFOLIO Crescita owns and focuses on 3 brands Targeted skin conditions include aging and wrinkles, rosacea, acne and dry skin High quality, active ingredients Manufactured under Good Manufacturing Practice (GMP) 6
SALES & DISTRIBUTION FOOTPRINT Sales & Marketing Infrastructure in Canada Our Portfolio of non-rx skincare products are: Sold to healthcare professionals and professional aestheticians Distributed in aesthetics and medical clinics Sold by a highly trained sales force Supported by fully integrated marketing, training and customer service functions Available for export via distributors 7
PEEL AND DURAPEEL TM Topical and transdermal drug delivery Phase-changing cream using self-occlusion to deliver actives into or through the skin Proven capability with a variety of actives Reduced product transference risk Fast drying and extended drug delivery Latest patent expiring in 2027, for DuraPeel TM Peel Single-solvent system Currently used in Pliaglis DuraPeel Two solvent system (volatile and non-volatile) Volatile solvent evaporates resulting in flexible patch Flexible patch adheres to skin, maintaining drug delivery for desired application time Potential Dermatological Applications Acne Psoriasis Wound healing Anti-viral Anti-bacterial Warts Basal Cell Carcinoma (BCC) Rosacea 8
MMPE TM Topical and transdermal drug delivery MMPE Multiplexed Molecular Penetration Enhancer Description Uses synergistic combinations of pharmaceutical excipients Can be used for Rx and non-rx products Indication / Skincare actives Benefits Wrinkle reduction / anti-aging Firming of skin Exfoliation Moisturizing Increased penetration of API s Possible improved efficacy Skin lightening Acne Inflammation Lower API concentration Possible lower dosing Patent Status U.S. Patent until 2027. PCT applications pending - latest expiry in 2036 9
RX PRODUCT The only FDA-approved, phase-changing, self-occluding topical anesthetic cream with the highest concentration of Tetracaine and Lidocaine Description API / Indication Topical local anaesthetic using our Peel technology Provides safe and effective local dermal analgesia on intact skin 7% Tetracaine + 7% Lidocaine Pain Patent Status Pliaglis until 2020 Flexicaine, 2 nd generation until 2031 Uses Dermal filler injections Pulsed-dye laser therapy Laser-assisted tattoo removal Non-ablative laser facial resurfacing Commercial Status Exclusive licensing agreement with Taro for U.S. rights signed in 2017 Pliaglis launched in U.S. in Q1-18 Galderma has ROW distribution rights. Crescita can reacquire starting in 2021 Potential for a further US$3.75 million in milestones 10
RX PRODUCT ROADMAP FORMULATION DEVELOPMENT/ PRE-CLINICAL IND FILED PHASE 1 PHASE 2 PHASE 3 COMMERCIAL Pliaglis U.S. Rights Out-Licensed to Taro (Crescita Rights - Canada, Mexico; Galderma - ROW) Flexicaine (2nd generation Pliaglis - Out-licensed to Taro) MiCal 1* (Topical treatment of Psoriasis) MiCal 2* ** Dermo Cosmetic Portfolio * Target development of 2 dermatological products. MiCal 1 is for treatment of Plaque Psoriasis. The therapeutic indication for MiCal 2 has not yet been disclosed. * Crescita responsible for formulation development / IP and providing MMPE technology * Fully funded by our partner Ferndale Laboratories and a leading U.S. CRO * Economic benefits to be shared upon out-licensing ** Dermo cosmetic portfolio internal development 11
CMO SERVICES Contract Manufacturing Organization Services FACILITY A modern, 50,000sqf Health Canada compliant manufacturing facility in Montreal, Canada MANUFACTURING CAPABILITIES Formulations manufactured by Crescita include: 1. Cosmetics products 2. Natural health products and 3. DIN (Drug Identification Number) products TURNKEY SOLUTIONS R&D and technology Needs analysis Ingredient sourcing Processing FORMULATIONS & PACKAGING We produce creams, liquids, gels, ointments & serums and package into tubes, bottles, vials and pumps Packaging Delivery 12
GLOBAL MARKET TRENDS Skincare market: ~US$180B by 2024 Cosmeceutical market: ~US$80B by 2023 Physician dispensed cosmeceuticals market: ~US $28B by 2024 Spa market: ~US$14B Canadians spend $1.4B in beauty products per year in 12,000 Spas in Canada, resort & medical spas, hotel, esthetics, day salons 13
CORPORATE STRATEGY & FOCUS Organic Growth International Markets & Out-Licensing Agreements Operational Effectiveness Innovation & Technology Strategic Acquisitions & In Licensing Agreements Contract Manufacturing Services (CMO) 14
DRIVING TRANSFORMATION 2019 & Beyond 2017 Out-licensed Pliaglis U.S. rights to Taro Acquired Alyria Completed $1.0M convertible debenture financing Paid down long-term debt by $4.2M 2018 Raised $3.5M through Rights Offering Announced U.S. launch of Pliaglis with $2.7M in YTD royalties Achieved 1st milestone on U.S. sales of Pliaglis, triggering payment of $1.3M 2018 cont d Reported 2 quarters of positive Adjusted EBITDA Reported improved penetration of CBD using MMPE and DuraPeel Launched 5 product innovations in skincare Reported FDA approval of Not for Home Use label restriction removal for Pliaglis Pursue transformational business development and operational activities 15
GEARED FOR GROWTH Rx Milestone Opportunities U.S. launch of Pliaglis by Taro US$0.5M milestone FDA approval of Not for Home Use label restriction removal Pliaglis launch in Canada Received $2.7M in Pliaglis royalties YTD + $1.3M sales milestone US$0.75M milestone U.S. Regulatory approval of Flexicaine MiCal 1 Completion of Phase 3 studies and potential out-licensing revenue 2018 2019z 2020 Focused on strategic M&A, international market and CMO expansion and organic growth 16
IMPROVING REVENUE & ADJ. EBITDA 17
FINANCIAL SNAPSHOT STOCK SYMBOL Market Cap (as at January 3, 2019 ) TSX: CTX $9.7M Share Price (as at January 3, 2019 ) $0.46 Shares Outstanding (as at January 3, 2019 ) 21.0M Fully Diluted Shares Outstanding (September 30, 2018 ) 24.9M Share Price 52-week Low-High $0.35 $0.90 Cash and Cash Equivalents (as at September 30, 2018 ) Non-Current Financial Liabilities (as at September 30, 2018 )* $8.2M $3.3M * Non-current financial liabilities are defined as the sum of the long-term portions of long-term debt, convertible debentures and other obligations. 18
WHAT S AHEAD
OUR STRATEGIC TARGET Strategic Aspiration to be a profitable $50M revenue-generating commercial dermatology company in 5 years 2018 2020 2023 20
INVESTMENT HIGHLIGHTS Crescita represents an excellent investment opportunity: Undervalued and relatively new company Prescription products, led by Pliaglis in the U.S., represent significant upside potential Non-prescription business well positioned for international out licensing and growth in CMO business Multiple growing revenue streams Patented technologies can be leveraged in both Rx and non-rx business in many lucrative industries, such as Cannabis 21
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