Trading Update

Quantum Pharma Plc

("Quantum" or the "Group")

Trading Update

Quantum Pharma Plc (AIM: QP.), the growing service-led niche pharmaceutical manufacturer, developer and supplier to the health and care sectors, today announces the following trading update.

The Board reports that the adjusted EBITDA level for Group for the year ending 31 January 2016 is expected to be around £12.7 million against market consensus of £13.4 million. Overall the Group has progressed significantly in FY 2016. However, the Niche Pharmaceutical division has experienced delays in its product pipeline. As a result of this, the Board now expects more moderate double digit revenue and EBITDA growth for FY 2017.

By the end of the current financial year to 31 January 2016, the Board expects that five regulated products in the Niche Pharmaceutical division will have been launched rather than the ten products anticipated at the half year results in October 2015. The other five regulated products are now due to be launched during FY 2017.

Following the recent appointment of the new managing director of the Niche Pharmaceutical division the Board has undertaken a commercial and operational review to assess how effectively the delivery of the pipeline was being managed.

As part of this review, external consultants were engaged to assess the value and market potential of the regulated product pipeline. The Board is pleased to report that its prior assessments of the value of the pipeline, which has more than doubled in size since the Group was admitted to AIM, have been reaffirmed.

Operationally, the review has determined that the delays have been as a result of issues in the following areas: i) internal management and process; ii) supply chain management; and iii) third party regulatory body approval. The Board considers that progress in obtaining product approvals is around 12 months behind the expected schedule at the time of the Group's Admission to AIM. The Board is implementing a programme of actions to address these issues and is confident that the management of the regulatory approval process will be significantly improved as a result.

The Group's Specials division remains well placed to continue to grow its market share. Through its exclusive agreements it continues to benefit from the acquisition strategies of three of the largest players in the UK pharmacy market. As noted in the half year results announcement, during the year there has been volume pressure in the specials market, but this has stabilised over the last six months.

For the year ending 31 January 2016, the Directors expect to declare a final dividend payment of 1.0 pence per share in line with market expectations making a full year dividend of 1.5 pence per share.

Andrew Scaife, CEO of Quantum Pharma, said: "The issues that Colonis has experienced in its pipeline have been identified and are being addressed. The fundamentals of the Group are stronger now than they were at the time of the AIM IPO. Although the Niche Pharmaceutical pipeline has moved to the right, we are confident it will come to fruition over the next 24 months.

"In the last year we have restructured the Group into three divisions and strengthened it with some key senior appointments and have also successfully integrated two acquisitions which, along with the commercialisation of Biodose Connect® in the first half of 2016, will lay the foundations for future growth."

The Group will be announcing its Final Results on Tuesday, 10 May 2016. An analyst briefing will be held at 09.30hrs at the offices of Buchanan, 107 Cheapside, London EC2V 6DN.

- Ends -

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Notes to Editors

Quantum Pharma is a service-led, niche pharmaceutical manufacturer, developer and supplier to the retail pharmacy, pharmaceutical wholesale, hospital, homecare and care home markets. Quantum Pharma operates through three divisions, offering a portfolio of innovative and complementary products and services.

Specials:

Compromising four business units:

Quantum Pharmaceutical manufactures and supplies specials and special obtains for pharmacy chains, pharmaceutical wholesalers, hospitals and independent pharmacies in the UK.

UL Medicines sources and supplies unlicensed imported medicines, batch-made and bespoke specials to hospitals, community pharmacies and wholesalers in the UK and overseas.

NuPharm offers outsourced manufacture for solid and liquid dose batch-made specials and niche licensed medicines, product development as well as clinical trials product manufacture.

Quantum Aseptic Services manufactures aseptically prepared, sterile intravenous products, either individually, for named patients or in batches for supply to private and NHS hospitals and homecare patients.

Niche Pharmaceuticals

Compromising three business units:

Colonis® is a product development business, which takes niche pharmaceutical products through the regulatory pathway to achieve licensed and/or regulated status.

Lamda is a full-service contract development specialist with customers across Europe. It specialises in creating added-value products with distinct advantages for patients and health care providers. It also provides full services for the entire development chain - from inception to registration; to post-approval, finished product supply and regulatory support.

PERN Consumer Products, owner of the Dermacool brand - a range of menthol in aqueous creams.

Medication Adherence

Compromises two business units:

Biodose® a medicines delivery system that accommodates liquid and solid medication, supporting medicines administration and adherence, for patients, their carers and clinicians. Biodose Connect® - A telehealth version with the ability to remotely monitor medication adherence is in live testing.

Biodose Services® assembles and delivers pre-prepared medication regimes to care homes and homecare patients, incorporating Biodose® as appropriate.

For further information, please visit www.quantumpharmagroup.com.