Mayne Pharma Announces Acquisition of Metrics, Inc.

October 3, 2012

October 3, 2012: Mayne Pharma Group Limited (“Mayne Pharma”), a publicly held company based in Melbourne, Australia, is pleased to announce that it has entered into a binding agreement to acquire Metrics, Inc. (“Metrics”), a privately-owned provider of contract development services to the pharmaceutical industry that also develops and manufactures niche generic drugs. Metrics is based in Greenville, North Carolina.

Consideration for the acquisition will comprise an upfront payment of US$105m plus further earnout payments of up to US$15m based on Metrics’ performance for the 12 months ended June 30, 2013.

Closing of the acquisition remains subject to material conditions, including completion of financing arrangements by Mayne Pharma and there being no material adverse event in relation to Metrics. Closing is also subject to the approval of Metrics’ shareholders; however, holders of a majority of Metrics’ capital stock have already agreed to vote in favor of the transaction.

Metrics will continue to be led by its current senior management team, and will continue to operate out of its existing Greenville facilities. The only change to Metrics’ business will be new access to enhanced resources, operational best practices and intellectual capital that will provide significant upside and opportunity for increased levels of success for Metrics, Mayne Pharma and the customers the two companies serve.

Overview of Metrics

Founded as a contract analytical laboratory in 1994 by Burroughs Wellcome scientist Phil Hodges and ECU professor Dr. John Bray, Metrics is a privately owned, specialty pharmaceutical company based in Greenville, North Carolina. Metrics, which has approximately 300 employees, provides contract development services to the pharmaceutical industry and develops and manufactures niche generic drugs.

Metrics has particular expertise in formulating complex oral drug products, including highly potent and unstable compounds, controlled substances (such as opiates) and products with poor bioequivalence. These products are sold in the U.S. via exclusive distribution partners or directly through Metrics’ in-house wholesale distributor, Midlothian Laboratories. In addition to its existing products, Metrics has a pipeline of 11 niche generic drugs in various stages of development, including two that have been filed with the US Food and Drug Administration (FDA) and a further nine products to be filed by the end of FY13.

Metrics has been one of the fastest growing pharmaceutical contract development and manufacturing organizations in the U.S. It is a leading provider of development services with a client base of more than 100 pharmaceutical customers, including industry leading, blue chip companies. Metrics has a vertically integrated model offering analytical services, formulation development, and clinical and commercial manufacturing.

Overview of Mayne Pharma

Founded in 1845 as FH Faulding & Co, Mayne Pharma is an Australian specialist pharmaceutical company with an intellectual property portfolio built around the optimization and delivery of oral dosage form drugs. Mayne Pharma has a long and successful history of developing and commercializing improved pharmaceuticals and has launched and marketed numerous products through partnerships with licensees in various countries around the world. Mayne Pharma focuses on delivering to patients improved versions of existing drugs in order to advance safety, efficacy or ease of administration.

A technology driven company, Mayne Pharma has a significant product portfolio and pipeline, global reach through distribution partners in Australia, the U.S., Europe and Asia, and a manufacturing facility in Salisbury, South Australia that employs more than 150 people.

Rationale for the acquisition

Mayne Pharma’s CEO, Scott Richards, said: “Metrics is highly complementary to Mayne Pharma’s existing business in term of its products, services and the markets in which it operates. In addition to providing scale in the US market, Metrics brings additional technical capabilities and material upside from cross-selling revenue opportunities. We have known Metrics’ senior management team for some time and they have a solid track record of success in the US generics industry.”

Metrics’ CEO, Phil Hodges, commented: “Over the past 18 years, Metrics has built a high quality operation with two different yet complimentary faces: a contract services business and a niche generic product development business. Mayne Pharma offers a unique strategic fit for Metrics that will allow our combined companies to become a global specialty pharma and development services group.”

Key benefits of the acquisition for Mayne include:

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