(A) VERY SUBSTANTIAL DISPOSAL AND CONNECTED TRANSACTION IN RELATION TO PROPOSED DISPOSAL OF APPROXIMATELY 19.14% OF THE ISSUED SHARE CAPITAL OF AND AN AGGREGATE OF HK$577,170,000 CONVERTIBLE BONDS ISSUED BY EXTRAWELL PHARMACEUTICAL HOLDINGS LIMITED (STOCK CODE: 858) AND (B) NOTICE OF SPECIAL GENERAL MEETING

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Innovative Pharmaceutical Biotech Limited, you should at once hand this circular and the accompanying proxy form to the purchaser or the transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

INNOVATIVE PHARMACEUTICAL BIOTECH LIMITED

領航醫藥及生物科技有限公司

(Incorporated in the Cayman Islands and continued in Bermuda with limited liability)

(Stock Code: 399)

(A) VERY SUBSTANTIAL DISPOSAL AND CONNECTED

TRANSACTION IN RELATION TO

PROPOSED DISPOSAL OF APPROXIMATELY 19.14% OF THE ISSUED SHARE CAPITAL OF AND AN AGGREGATE OF HK$577,170,000 CONVERTIBLE BONDS ISSUED

BY EXTRAWELL PHARMACEUTICAL

HOLDINGS LIMITED (STOCK CODE: 858) AND

(B) NOTICE OF SPECIAL GENERAL MEETING

Independent Financial Adviser to the Independent Board Committee and

the Independent Shareholders

Capitalised terms used in this cover page shall have the same meanings as those defined in this circular unless otherwise stated.

A letter from the Board is set out on pages 7 to 26 of this circular. A letter from the Independent Board Committee is set out on pages IBC-1 to IBC-2 of this circular. A letter from the Independent Financial Adviser of the Company containing its advice to the Independent Board Committee and the Independent Shareholders is set out on pages IFA-1 to IFA33 of this circular.

A notice convening the SGM to be held at Falcon Room I, Basement, Gloucester Luk Kwok Hong Kong, 72 Gloucester Road, Wanchai, Hong Kong on Friday, 4 October 2019 at 11:00 a.m. is set out on pages SGM-1 to SGM-3 of this circular. A form of proxy for the SGM is enclosed with this circular. Whether or not you intend to attend the SGM in person, you are requested to complete the accompanying form of proxy in accordance with the instructions printed thereon, and return the same to the branch share registrar and transfer agent of the Company, Tricor Tengis Limited, at Level 54, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong as soon as possible but in any event not later than 48 hours before the time appointed for the holding of the SGM or any adjourned meeting (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting in person at the SGM or any adjourned meeting should you so wish.

13 September 2019

CONTENTS

			Page
Definitions . . .	. . .	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
Letter from the Independent Board Committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	IBC-1
Letter from the Independent Financial Adviser . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	IFA-1
Appendix I	-	Financial Information of the Group . . . . . . . . . . . . . . . . . . . . . . . . .	I-1
Appendix II	-	Financial Information of the Target Group . . . . . . . . . . . . . . . . . . .	II-1
Appendix III - Unaudited Pro Forma Financial Information
		of the Remaining Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	III-1
Appendix IV	-	Valuation Report of the Purchase Convertible Bonds . . . . . . . . . . .	IV-1
Appendix V	-	Valuation Report of the Sale Convertible Bonds . . . . . . . . . . . . . . .	V-1
Appendix VI	-	General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	VI-1
Notice of the SGM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	SGM-1

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DEFINITIONS

In this circular, unless the context otherwise requires, the following expressions have the following meanings:

"associate(s)"	has the meaning ascribed thereto in the Listing Rules
"Best Champion"	Best Champion Holdings Limited, a company incorporated
	in the British Virgin Islands with limited liability which is
	owned as to 33.5% by United Gene Holdings and 33% by
	Victory Trend
"Biowindow Gene"	Biowindow Gene Development (Hong Kong) Limited, a
	company incorporated in Hong Kong with limited liability
	which is wholly owned by United Gene Group
"Board"	the board of Directors
"Business Day(s)"	a day (excluding Saturday and other general holidays in
	Hong Kong and any day on which a tropical cyclone
	warning no. 8 or above is hoisted or remains hoisted
	between 9:00 a.m. and 12:00 noon and is not lowered at or
	before 12:00 noon or on which a "black" rainstorm warning
	is hoisted or remains in effect between 9:00 a.m. and 12:00
	noon and is not discontinued at or before 12:00 noon) on
	which licensed banks in Hong Kong are generally open for
	business
"China United Gene"	China United Gene Investment Holdings Limited, a
	company incorporated in the British Virgin Islands with
	limited liability which is owned as to 60% by Best
	Champion
"Company"	Innovative Pharmaceutical Biotech Limited (領航醫藥及生
	物科技有限公司) (stock code: 399), a company
	incorporated in the Cayman Islands and continued in
	Bermuda with limited liability and the issued Shares of
	which are listed on the main board of the Stock Exchange
"Company Convertible Bonds"	collectively, Company Convertible Bonds I and Company
	Convertible Bonds II

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	DEFINITIONS
"Company Convertible Bonds I"	the convertible bonds in an aggregate principal amount of
	HK$744,000,000 issued by the Company pursuant to an
	instrument of the Company Convertible Bonds I dated 25
	October 2013 with nil interest for a conversion period of
	ten years from the date of issue and a conversion price of
	HK$0.4 per Share
"Company Convertible Bonds II"	the convertible bonds in a principal amount of
	HK$715,000,000 issued by the Company to the Target
	Company pursuant to an instrument of the Company
	Convertible Bonds II dated 28 July 2014 with 3.5% interest
	per annum and with the conversion right to convert
	286,000,000 Shares of the Company for a conversion
	period of seven years from the date of issue and a
	conversion price of HK$2.5 per Share
"Completion"	completion of the Disposal in accordance with the terms
	and conditions of the Sale and Purchase Agreement
"Completion Date"	within five Business Days following the fulfillment of all
	conditions precedent under the paragraph headed
	"conditions precedent" in this circular or such other date as
	the Company and the Purchaser may agree in writing
"connected person(s)"	has the meaning ascribed thereto under the Listing Rules
"Consideration"	the consideration for the sale and purchase of the Sale
	Shares and the Sale Convertible Bonds
"controlling shareholder"	has the meaning ascribed thereto under the Listing Rules
"Disposal"	the proposed disposal of the Sale Shares and the Sale
	Convertible Bonds by the Company to the Purchaser
	pursuant to the terms of the Sale and Purchase Agreement
"Fosse Bio"	Fosse Bio-Engineering Development Limited

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	DEFINITIONS
"Good Links"	Good Links Limited, a company incorporated in the British
	Virgin Islands with limited liability which is owned as to
	50% by the Purchaser
"Group"	the Company and its subsidiaries
"HK$"	Hong Kong dollars, the lawful currency of Hong Kong
"Hong Kong"	the Hong Kong Special Administrative Region of the PRC
"In-process R&D"	in-process research and development project
"Independent Board Committee"	the independent board committee of the Board comprising
	all of the three independent non-executive Directors,
	namely, Ms. Chen Weijun, Dr. Zhang	Zhihong and
	Mr. Wang Rongliang, to advise the	Independent
	Shareholders on the Sale and Purchase Agreement and the
	transactions contemplated thereunder
"Independent Financial Adviser"	Donvex Capital Limited, a corporation licensed to carry out
or "Donvex Capital"	type 6 regulated activities under the SFO, the independent
	financial adviser to the Independent Board Committee and
	the Independent Shareholders in relation to the Sale and
	Purchase Agreement and the transactions contemplated
	thereunder
"Independent Shareholders"	Shareholders other than the Purchaser and its associates
"JNJ Investments"	JNJ Investments Limited, a company incorporated in the
	British Virgin Islands with limited liability which is wholly
	owned by Biowindow Gene
"Last Trading Day"	21 June 2019, being the last trading day of the Shares and
	the Target Company Shares immediately before the date of
	the Sale and Purchase Agreement
"Latest Practicable Date"	9 September 2019, being the latest practicable date prior to
	the printing of this circular for the purpose of ascertaining
	certain information contained herein

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