2016 Annual Results

Midatech Pharma plcApril 2017

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This presentation and the information contained herein are not an offer of securities for sale and are not for publication and or distribution in the United States or to any US person (within the meaning of Regulation S under the United States Securities Act of 1933,as amended (the “Securities Act”)) or in Canada, Australia, South Africa or Japan or any jurisdiction where such offer or distribution is unlawful. Any failure to comply with this restriction may constitute a violation of United States securities laws.

The securities of the Company have not been registered under the Securities Act and may not be offered or sold in the United States or to any US person unless the securities are registered under the Securities Act or an exemption therefrom is available.

Certain statements in this presentation may constitute “forward-looking statements” within the meaning of legislation in the United Kingdom and/or United States. In some cases, you can identify forward-looking statements by the use of words such as “may,”“could,” “expect,” “intend,” “plan,” “seek,” “anticipate,” “believe,” “potential,” “estimate,” “predict,” “potential,” or “continue” or the negative of these terms or other comparable terminology. You should not place undue reliance on forward-looking statementsbecause they involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond our control and that could materially affect actual results, the acquisition, levels of activity, performance, or achievements. Any forward-lookingstatements are based on currently available competitive, financial and economic data together with management’s views and assumptions regarding future events and business performance as of the time the statements are made and are subject to risks anduncertainties. We wish to caution you that there are some known and unknown factors that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. Referenceshould be made to those documents that Midatech shall file from time to time or announcements that may be made by Midatech in accordance with the London Stock Exchange AIM Rules for Companies (“AIM Rules”), the Disclosure and Transparency Rules(“DTRs”) and the rules and regulations promulgated by the US Securities and Exchange Commission, which contains and identifies other important factors that could cause actual results to differ materially from those contained in any projections or forward-lookingstatements. These forward-looking statements speak only as of the date of this presentation. All subsequent written and oral forward-looking statements by or concerning Midatech are expressly qualified in their entirety by the cautionary statements above. Exceptas may be required under the AIM Rules or the DTRs or by relevant law in the United Kingdom or the United States, Midatech does not undertake any obligation to publicly update or revise any forward-looking statements because of new information, future eventsor otherwise arising.

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A rapidly growing international specialty pharmaceutical company

UK-based public company (LON: MTPH / Nasdaq: MTP)• >100 employees across Europe & the US

• Diversified strategy and sources of revenue with innovative R&D pipeline

• Highly experienced pharma management team

Established US commercial presence (40 team members)• Six marketed products: potential aggregate peak sales of $50 million

• Double-digit top-line growth expected over the next 12 months

• Plan for lead product Q-Octreotide to be filed for marketing authorisation in 2018

Fully integrated R&D capabilities with two platform technologies• Glycan coated gold nanoparticles (GNP)

• CAD “printed” sustained-release particles (Q-Sphera)

• Drives a novel, low risk development pipeline based on known therapeutic agents

Organisation

CommercialForce

R&D

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2016 operational highlights

• Successful integration and strong sales performance from our recently acquired US commercial business• Total revenue for 2016, £9.2m, growth of 510% vs. 2015 (£1.5m)

• Launch of anti-nausea product Zuplenz in the US• Approved for use in multiple indications in a $10bn US market

• Bolsters marketed oncology product portfolio and leverages US commercial infrastructure

• Preparation for final development & commercialisation of Q-Octreotide• Manufacturing scale up in H1 – successful regulatory inspection

and final process validation completed at the Bilbao manufacturing facility

• Good in vivo data achieved

• Planned bioequivalence study to start H1 2017 and filing for first marketing authorisations anticipated by 2018

• Product candidate testing in-vivo for hepatocellular carcinoma (HCC) and glioblastoma (GBM) • Dana Farber testing Midatech’s targeted nanomedicines

against glioblastoma

• Lead product selected for both GBM and HCC programmes

• Dosing commenced in first immunotherapy Phase I study for type I diabetes

• Further positive progress seen in the period in the Company’s OpsiSporin and MTX110/111 (DIPG) programmes

Midatech Pharma continues to executeagainst all key areas of its business model

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*Pro forma revenue for Midatech plus DARA BioSciences, Inc. for 2015 was £4.9m

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Products & commercial platform

Midatech Pharma US (MTPUS): fully integrated commercial platform

MTPUS commercial operations

• MTPUS has an effective and established commercial platform to sell and market our current oncology supportive care portfolio (6 products)

• 25 representatives with access and established relationships in the highest prescribing oncology markets

• Established through acquisition of DARA BioSciences, Inc. for $24 million and of the complementary product Zuplenz for $3.75 million*

MTPUS commercial strategy

• Leverage oncology platform and access to acquire complementary products that enhance portfolio and increase revenues

• Utilise commercial operations to:

• Acquire additional products and launch internally developed pipeline products

• Fund on-going R&D programmes from long-term cash flows

Initial consideration subject to certain adjustments and additional, conditional payments

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Zuplenz

• Post-chemo radiotherapy anti-nausea and vomiting product

• Acquired for $3.75m (plus back-end milestones based onexcess over forecast sales)

• Expected pay-back time <18 months from point of acquisition

• Entrant into $10bn / 20m prescription per annum US 5HT3 market • 0.25% market share would give sales of $25m/pa

• 0.5% market share would give sales of $50m/pa

• Covered by 11/13 commercial insurers (>250m population)

• Competitive pricing $500/pack (range of competition $250-$1,800)• Superior support and presentation

• Zero patient co-pay program

• May be taken with or without water and dissolves in seconds

• No stickiness from a patch or gritty sensation from a tablet

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Gelclair

• Acquired via DARA BioSciences acquisition

• Indicated for oral mucositis (caused by chemotherapy or radio therapy), with approx. 400,000 annual sufferers in the US

• Lead product in uncompetitive environment (compounded magic mouthwash)

• Covered by 11/13 commercial insurers (>250m population)

• Superior support and mechanism of action vs. magic mouthwash• Zero patient co-pay program

• 3rd year of sales in 2016

• Estimated peak annual sales potential c.$10m

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Oravig

• Buccal tablet for treatment of oral “thrush” associated with radio/chemo therapy and in HIV patients

• Launched in October 2015

• Covered by 11/13 commercial insurers (>250m population)

• Over 4m rx written annually for localised treatment

• 0.1% market share = c.$3m annual sales (targeting 0.3%-0.5% market share)

• Superior support and presentation• Zero patient co-pay program

• Once-daily, local treatment

• Does not interrupt eating or drinking

• Revised annual sales potential c.$10m

• Acquired intangible asset has been impaired due to sales performance being below original forecast

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Research & development

DIPG pontine glioma MTX110 named patient basis

CED/DIPG MTX111

Development pipeline: 9 programmes

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RESEARCH PRECLINICAL PHASE I PHASE II

Immunotherapy

Cancer

CNS/Ocular

Q-Octreotide carcinoid MTD201

Glioblastoma MTR103

OpsiSporin uveitis MTD202

Liver hepatocellular carcinoma MTR104

Immuno-oncology vaccine MTR

Immuno-oncology TAM MTR

PHASE III

Type 1 diabetes vaccine MTX102

Development of multiple high-value, targeted therapies for major diseases with unmet medical need

Q-Octreotide (MTD201)

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Positive pre-clinical data

• Compares favourably with Sandostatin LAR

• Pharmacokinetic data correlates well with PD effects

• Injections well tolerated with no site reaction

Steps to commercialisation

• Pilot human pharmacokinetic study planned 2017,

followed by bioequivalence or therapeutic equivalence

programme in H2 2017

• Marketing authorisation submission anticipated in the

period Q4/17 - Q4/18

Advantages• Significantly easier to reconstitute and administer

than current Sandostatin product• Seconds to reconstitute vs 35 minutes• In home administration with patient friendly device

vs. current administration in clinic via IV• Smaller needle• Can reduce clinical visit time by more than half

Currently in final stages pre-clinical development• Formulation complete• Entering bio-equivalence or therapeutic equivalence studies

2017• Planned US launch in 2018/9

Manufactured in house with terminal sterilisation• Saves time (c6 months from CMO)• Investing now in preparation of full commercialisation• Enable other projects using Q-Sphera technology (e.g.

Ophthotech), to capture more value

Peak market potential c$100m pa• Own sales targeted in the USA• Centurion out-licence achieved for Turkish rights

Long-acting formulation of Octreotide acetate for chronic treatment of carcinoid (cancer) & acromegaly

Market worth over $2bn (Sandostatin LAR $1.6bn)

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DIPG: diffuse interstitial pontine glioma (MTX110)

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Direct administration of Midatech Nanotherapeutics into the tumour through Convection Enhanced Delivery (CED):• Delivers therapeutic constructs via a series of catheters

fixed directly into the substance of the tumours

Ultra-high unmet need, potential orphan indication

Compassionate use/named patient program: MTX110 • Four patients treated with MTX110 to date UK & US• First patient continues to be infused monthly (10

infusions to date)

MTX 111• Other DIPG constructs in R&D:

Maytansinoids (AT), Doxorubicin (TPI2), Irinotecan (TPI1), HDACi’s

Ultra rare childhood brain tumour• c.1,000 cases / year worldwide• Average survival = 7-9 months; universally fatal

Research & Development next steps:• Regulatory interactions throughout 2017 – high level of

support for program by regulatory agencies• MTX110: planning for Phase I study at advanced stage –

estimated start H2 2017• MTX111: follow-on programme

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Targeted maytansinoid for HCC (MTR104)

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Currently in pre-IND developmentParticle construction & targeting completeTwo step targeting – passive to liver & active to tumour cell receptorsPlan to file for FIH study in Q4 2017

• Manufacturing scale up underway to GMP• Orphan Designation applied for • Clear dose responses & at 450μ g/kg very significant Tumor

reduction seen

Peak market potential >$500m pa• Co-promote / MTP own sales in the USA• Global partner sought to co-develop this program

Compelling data to date shows animals thrive on targeted chemo, at a level of dose (450μ g/kg) that is lethal without the targeting

Market worth over $1.5bn by 2019

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2016 financials

2016 financial highlights

• Total gross revenues for the year up 510% to £9.21m (2015: 844% to £1.51m)

• Statutory revenue for the year up 718% to £6.38m (2015: 2,500% to £0.78m)

• £17.61m cash and deposits at 31 December 2016 (2015: £16.18m)

• Net loss after tax of £20.16m (2015: £10.10m) with net cash inflow in the year of £0.97m (2015: £14.17m outflow)

• Tax credit receivable of £1.44m (2015: £1.20m)

• Entered into a senior secured £6 million loan agreement with Silicon Valley Bank in Q1 2017

• October 2016 Gross £16.7m Equity Raise completed in London

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Consolidated income statement

(audited) Year ended 31 Dec 2016

Year ended31 Dec 2015

£'000 £'000

Gross revenue 8,659 914Grant revenue 547 600

_______ ________Total revenue 9,206 1,514

_______ ________

Total net revenue 6,923 1,375

Cost of sales (667) (70)_______ ________

Gross profit 6,256 1,305

Research and development costs (6,684) (5,920)Distribution costs, sales and marketing (9,523) (374)Administrative costs (9,222) (7,929)Impairment of intangible asset (11,413) -

_______ ________Loss from operations (30,586) (12,918)

Finance income 1,337 1,691Finance expense (73) (5)

_______ ________

Loss before tax (29,322) (11,232)

Taxation 9,160 1,133_______ ________

Loss after tax attributable to the owners of the parent (20,162) (10,099)________ ________

Loss per share Basic and diluted loss per ordinary share – pence (56p) (36p)

(audited) As at31 Dec 2016

As at31 Dec 2015

£’000 £’000Non-current assetsProperty, plant and equipment 2,766 1,984Intangible assets 31,172 41,339Other receivables due in greater than one year 448 425

_______ _______

34,386 43,710_______ _______

Current assetsInventories 817 459Trade and other receivables 2,439 2,496Taxation 1,439 1,201Cash and cash equivalents 17,608 16,175

_______ _______

22,303 20,331_______ _______

Total assets 56,689 64,041_______ _______

Non-current liabilitiesBorrowings 1,620 1,508Deferred tax liability - 6,547

_______ _______

1,620 8,055_______ _______

Current liabilitiesTrade and other payables 8,407 7,084Borrowings 538 442Derivative financial liability – equity settled 400 1,573

_______ _______

9,345 9,099_______ _______

Total liabilities 10,965 17,154_______ _______

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Consolidated balance sheet

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Consolidated cash flow statement

(audited) Year ended 31 Dec 2016

Year ended31 Dec 2015

£’000 £’000

Cash used in operations (14,736) (13,067)

Taxes received 1,650 646_______ _______

Net cash used in operating activities (13,086) (12,421)_______ _______

Investing activitiesPurchases of property, plant and equipment (1,347) (922)Purchase of intangibles (19) (3)Acquisition of subsidiary, net of cash acquired - 1,867Acquisition of business - (2,528)Interest received 164 53

_______ _______Net cash used in investing activities (1,202) (1,533)

Financing activitiesInterest paid (74) (5)Payments to finance lease creditors (69) (49)Repayment of borrowings (235) (165)Issue of borrowings 65 -Loan finance raised - -Share issues net of costs 15,568 -

_______ _______Net cash (used in)/generated from financing activities (15,255) (219)

Net (decrease)/increase in cash and cash equivalents 967 (14,173)

Cash and cash equivalents at beginning of year 16,175 30,325

Exchange gains on cash and cash equivalents 466 23_______ _______

Cash and cash equivalents at end of year 17,608 16,175_______ _______

2017 expected news flow

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• Q-Octreotide human bio-equivalence studies to commence in 2017

• Further updates on brain tumour cancer therapy programme (DIPG) for compassionate use patients

• Lead candidate selected for HCC orphan status & IND submission

• Further preclinical data across multiple programmes

• Further deployment of core technologies via licensing deals to new and existing partners

• Licensing of Bilbao facility to GMP manufacture Q-Sphera based products like Q-Octreo

Summary

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On-track for execution of three-pronged strategy for growth and value creation• Continue to invest in products and technology to drive value for stakeholders in the business• Developing novel pre-clinical and clinical portfolio pipeline• Seeking attractive acquisition targets, products and technology• Strong cash position to drive towards profitability

Leading proprietary platform technologies

• Gold nanoparticles• Sustained-release delivery• Targeted delivery and release of existing therapeutics to the “right place” at the “right time”

Midatech Pharma an international specialty pharma company• Focused on development and commercialisation of multiple high-value, targeted therapies for

major diseases with unmet medical needs• US commercial arm has six products in oncology treatment and supportive care, driving revenue

growth• Own product launches from 2018-19 at high margin

Photograph of section through needle showing microspheres

Representation of a gold nanoparticle

Appendix

Highly experienced pharma management team focused on delivery

Rolf StahelNon-executive Chairman

Dr. Jim Phillips, MB, ChB, MBAChief Executive Officer

Nick Robbins-Cherry, ACA, MBAChief Financial Officer

Dr. Craig Cook, MD, MBAChief Operating Officer

David BenharrisPresident, Midatech Pharma US

Rob Rainey, FCA, MBA, MAHead of Corporate Development

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OpsiSporin (MTD202)

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Development pathway

• IND enabling to commence approx. Q4 2016

• Toxicology program will complete approx. Q4 2017

• Phase I to commence approx. Q4 2017 or Q1 2018

Successful PoC completed in several animal models

• Clear dose response established in prophylactic model

• Efficacy to be established in therapeutic model

• Terminal sterilisation study underway

Intravitreal injection via 27-30G needle directly to vitreous and posterior eye, with minimal transfer to the blood

Orphan indication. Orphan Drug Designation application to be submitted September 2016

Advantages• Product will be steroid and

immunosuppressant sparing• Delivered intravitreal at 1000 fold lower

doses than oral cyclosporine• Currently no approved intravitreal

cyclosporine or other immunosuppressant treatment option available

OpsiSporin is injectable sustained release formulation of cyclosporine for treatment of non-infective uveitis

Uveitis growing rapidly ~$1.3bn market, current treated by eye drops, immuno-suppressives or systemic

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Glioblastoma (GBM) (MTR103)

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Combined targeting and therapeutic

• Development in conjunction with Dana Farber institute

• Candidate selection planned Q3 2016

• IND enabling to commence by end of 2016

• Filing for marketing authorisation anticipated by 2018

Survival typically 12 to 15 months

• Less than 5% surviving greater than five years

Orphan indication – Orphan Drug Designation application to be submitted

• GNP’s targeted to bind tumour specific receptors on GBM cells; internalised GNPs developed to release therapeutic payload intracellularly

• GNP design customised to maximise uptake for specific GBM indication

Worldwide estimated 240,000 cases of brain and nervous system tumours per year

• GBM is most common, and most lethal, of these tumours

Systemic and intra-tumoural administration

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GNP ASI immunotherapy vaccine (MTX102)

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• Combination of Midatech GNP technology and Antigen Specific Immunotherapy (ASI) • 20% of population suffer from autoimmune disease

• Current autoimmune treatments suppress whole immune system which increases risk of infection and cancer

• GNP ASI stimulates a disease-regulating response without affecting the rest of the immune system

• Initial focus is largest autoimmune disease, diabetes, however the programme also has broad potential applicability in oncology

• Positive pre-clinical data• GNP ASI substantially enhances disease-regulating response

• Preferentially targets specific immune cells

• Clinical and commercial production• Manufactured in-house with fill and finish by CMO

• Development • Phase I study due to commence in Q3 2016 and meeting

will be held in Q4 2016, completing in 2017

• Regulatory approvals for studies obtained in UK and Sweden

Immunotherapy ‘pipeline’

Antigen Specific Immunotherapy (ASI):• GNP ASI data suggests enhanced tolerogenic response in autoimmune disease

Dendritic or Peptide Vaccine• GNP peptide conjugates enhance proliferation of cytotoxic antigen-specific CD8+ T cells

Tumour Associated Macrophages• GNP conjugates activate M2 macrophages towards a classical M1 cancer killing phenotype

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