EPITAN - Clinuvel Pharmaceuticals

EPITANBeyond June 2007 we believe R&D expenditure is likely to decline significantlyfollowing the completion of Phase III trials and the partnering of MELANOTAN forterritories outside Australia and New Zealand. In addition, we expect a partnering dealto involve the payment of a milestone on filing of the product with regulatory authoritiesand a further milestone payment on launch, followed by royalties on sales.Upside to revenue forecasts is likely as EpiTan continues to in-license products forsales and distribution in Australia and New Zealand. However, until further deals areannounced it is impossible to forecast sales for future portfolio products.The following table details EpiTan’s historic cash flows and our forecast cash flowprojections. A successful fundraising of £15m ($A36m) and admission to AIM will, inour view, provide sufficient capital to fund EpiTan through to at least June 2007 andthe completion of Phase III trials of MELANOTAN.EpiTan cash flow forecastsYear to June $A'000 2003A 2004A 2005E 2006E 2007EOperating profit (4,113) (7,945) (10,248) (16,866) (11,340)Depreciation, amortisation 794 790 790 790 790Working capital 125 808 (27) (166) (255)Net interest 153 344 411 797 284Tax paid - - - - -Other - - -Gross cash flow (3,041) (6,002) (9,074) (15,445) (10,520)Capex (75) (43) (100) (100) (100)Use of provs. Other - - -Free cash flow (3,116) (6,045) (9,174) (15,545) (10,620)Dividends - - - - -Acqs, disposals - - - - -Shares issued 1,198 9,794 36,000 - -Other 116 (880) (4,200) - -Change: net debt -1,802 2,869 22,626 -15,545 -10,620End net cash (debt) 2,612 5,481 28,108 12,563 1,943Source: EpiTan, T&G forecasts16