Luye Pharma : VOLUNTARY ANNOUNCEMENT - ANSOFAXINE HYDROCHLORIDE EXTENDED RELEASE TABLETS (LY03005) COMMENCED PHASE III CLINICAL TRIAL IN CHINA

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LUYE PHARMA GROUP LTD.

綠 葉 製 藥 集 團 有 限 公 司

(Incorporated in the Bermuda with limited liability)

(Stock Code: 02186)

VOLUNTARY ANNOUNCEMENT

ANSOFAXINE HYDROCHLORIDE EXTENDED RELEASE TABLETS (LY03005)

COMMENCED PHASE III CLINICAL TRIAL IN CHINA

Reference is made to the Company's announcements dated 27 March 2015, 2 July 2015, 12 August 2015 and 23 January 2018 in relation to the development of the Group's product candidate, ansofaxine hydrochloride extended release tablets (''LY03005''), a New Chemical Entity (NCE) and China Class 1.1 New Chemical Drug. The board of directors (the ''Board'') of Luye Pharma Group Ltd. (the ''Company'', together with its subsidiaries, the ''Group'') is pleased to announce that LY03005 commenced phase III clinical trial in the People's Republic of China (''China'').

ABOUT LY03005

LY03005 is a central nervous system product candidate being developed within new compounds platform. It is a serotonin-norepinephrine-dopamine triple reuptake inhibitor (SNDRI) in extended release tablet form for the treatment of MDD.

Traditional anti-depressants such as selective serotonin reuptake inhibitors (SSRIs) and serotoninnorepinephrine reuptake inhibitors (SNRIs) drugs are typically associated with disadvantages such as anhedonia, sexual dysfunction and inability to improve cognitive impairment. LY03005 is expected to help preserve patients' sexual function, have a better safety profile and produce a more rapid onset and better efficacy than traditional anti-depressants.

The Group had obtained patents covering the chemical compound, crystal form and formulation of extended release tablets. The patents of the chemical compound and crystal form had been granted in the target countries such as China, United States, Europe, Japan, Korea, etc.

Those patents of the chemical compound were granted and will be valid until 2026 (or 2029 specifically in U.S.).

The Group plans to register and launch LY03005 in the U.S., Japan, China, Europe and other countries.

ABOUT DEPRESSION

Depression is a common illness worldwide, with more than 300 million people affected according to data of the World Health Organization, and the illness brings pain and hardship to patients and, in particular, causes patients to suffer in their social life.

According to the data of IQVIA, the market size for anti-depressants in the United States and Europe in 2017 was US$5.62 billion and US$3 billion, respectively. While the market size for anti-depressants in the PRC in 2017 was approximately RMB4.64 billion, this market grew at a CAGR of 12.9% from 2015 to 2017.

ABOUT CENTRAL NERVOUS SYSTEM PIPELINE PROJECTS

Besides LY03005, the Group has numerous pipeline projects regarding the central nervous system for the concurrent development of China and overseas markets, with projects such as Risperidone Extended Release Microspheres for injection (LY03004) for Schizophrenia and bipolar disorder, Rotigotine Extended Release Microspheres for injection (LY03003) under research for Parkinson's disease, Rivastigmine transdermal patch for mild to moderate Alzheimer's disease. The registration of the above products are progressing well in strategic markets such as China, U.S., Europe and Japan, and the products are expected to be launched in these countries and further expanded into the global market.

By Order of the Board LUYE PHARMA GROUP LTD.

Liu Dian Bo

Chairman

Hong Kong, 11 June 2018

As at the date of this announcement, the executive directors of the Company are Mr. LIU Dian Bo, Mr. YANG Rong Bing, Mr. YUAN Hui Xian and Ms. ZHU Yuan Yuan; the non-executive Director of the Company is Mr. SONG Rui Lin; and the independent non-executive directors of the Company are Mr. ZHANG Hua Qiao, Professor LO Yuk Lam, Mr. LEUNG Man Kit and Mr. CHOY Sze Chung Jojo.