2 Second Consolidated Amended Complaint 03/28/2006

UNITED STATES DISTRICT COURTDISTRICT OF MASSACHUSETTS

IN RE: BIOPURE SECURITIES LITIGATION

Civil Action No. 03-12628-NG JURY TRIAL DEMANDED [Leave to file granted, Docket # 109]

SECOND CONSOLIDATED AMENDED COMPLAINT

Lead Plaintiff Ronald Erickson and Plaintiffs Stuart Gottlieb, John G. Esposito, Jr.,

and Emily A. Bittman (collectively referred to herein as “Plaintiffs”), through their attorneys,

allege the following upon information and belief, except as to the allegations which pertain

to the Plaintiffs and their counsel, which are alleged upon personal knowledge. Plaintiffs’

information and belief are based, inter alia, on the investigation made by and through his

attorneys and on the publicly available information relating to the investigation by the

Securities and Exchange Commission (“SEC”), including in particular the SEC’s civil fraud

complaint (the “SEC Complaint”) that was filed in this judicial district on September 14,

2005 in Securities and Exchange Commission v. Biopure Corporation, Inc., et als., No. 05-

CA-11853-PBS (the “SEC Action”). A copy of the SEC Complaint is attached hereto as

Exhibit A and is incorporated herein, in full, by reference.

INTRODUCTION

1. This is a federal securities class action which is brought by the Plaintiffs

against the Defendants, Biopure Corporation (“Biopure” or the “Company”) and Biopure’s

past or present officers and directors, Thomas A. Moore, Carl W. Rausch, Ronald Richards

and Howard P. Richman, on behalf of a class (the “Class”) consisting of all persons or

Case 1:03-cv-12628-NG Document 110-1 Filed 03/28/2006 Page 1 of 92

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entities who acquired the common stock of Biopure during the period April 9, 2003 through

December 24, 2003, inclusive (the “Class Period”). Plaintiffs seek to recover damages

caused to the Class by Defendants’ violations of Sec. 10(b) of the Securities Exchange Act

of 1934 (the “Exchange Act”) and Rule 10b-5 promulgated thereunder. This action is also

brought under Section 20A of the Exchange Act on behalf of all persons who purchased

Biopure common stock contemporaneously with the sales of Biopure’s stock by the

Defendants Biopure and Rausch (the “Sub-Class”) during the Class Period.

2. Biopure develops, manufactures and markets oxygen therapeutics, for both

human and veterinary use, designed to serve as an alternative to red blood cell

transfusions and for use in the treatment of other critical care conditions. The Company

has developed and manufactures two biologic products: Hemopure – 250 (bovine), or

HBOC-201 – for human use, and Oxyglobin – hemoglobin glutamer – 200 (bovine), or

HBOC-301 – for veterinary use. Oxyglobin is approved for use in the United States for

administration to dogs. Hemopure is not approved for any human use in the United States;

aside from being approved in South Africa for use only in severely anemic surgery patients,

it is not approved for human use in any other country.

3. On July 31, 2002, Biopure submitted a biologic license application (“BLA”) to

the U.S. Food and Drug Administration (“FDA”) seeking regulatory approval to market

Hemopure in the United States for patients undergoing orthopedic surgery (the “Hemopure

BLA”). In March 2003, Biopure notified the FDA of its intent to perform Phase III clinical

trials of Hemopure on human trauma victims in hospitals.

4. This action arises as a result of the Defendants’ issuance of and making of

numerous public statements during the Class Period regarding Biopure, Hemopure, the


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Hemopure BLA, and Biopure’s proposed clinical trials for use of Hemopure for trauma

victims (the “Trauma Clinical Trials”). As detailed herein, those statements by the

Defendants were false or materially misleading because of the omission therefrom, and

because of Defendants’ failure to publicly disclose, communications to Biopure from the

FDA beginning in April 2003, in which the FDA expressed safety concerns about

Hemopure.

5. The FDA’s safety concerns arose from adverse event data from Biopure’s

Phase III orthopedic surgery trial for Hemopure, which adverse event data had been

submitted by Biopure to the FDA as part of the Hemopure BLA. As a result of these safety

concerns, the FDA placed a clinical hold on the Trauma Clinical Trials on or about April 9,

2003. This action constituted a refusal by the FDA to permit Biopure to conduct its

proposed clinical trials for use of Hemopure for trauma victims.

6. In or about May 2003, Biopure’s request for the FDA to lift its clinical hold was

denied by the FDA.

7. On or about July 30, 2003, the FDA transmitted two long, detailed letters to

Biopure conveying still further negative developments with respect to Biopure’s efforts at

gaining regulatory approval of Hemopure. One letter refused once again to permit

Biopure’s clinical trials to proceed because of “an unreasonable and significant risk of

illness or injury” to human subjects. The other letter constituted FDA’s complete response

letter to the Hemopure BLA (the “Complete Response Letter”).

8. The Complete Response Letter, attached hereto as Exhibit B, informed

Biopure that the FDA was not approving the Hemopure BLA due to extensive, significant

deficiencies in Biopure’s BLA and due to the FDA’s persistent, unmitigated concerns about


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the lack of safety and efficacy of Hemopure. In the Complete Response Letter, the FDA

posed over 200 questions to Biopure. Transmission of the Complete Response Letter

signified formally that FDA had completed its review of the Hemopure BLA and that Biopure

had a six-month period within which it could resubmit the BLA in a form that addressed all

of FDA’s concerns.

9. Biopure was never able to address all of the deficiencies, problems, and

concerns set forth by the FDA in the Complete Response Letter. Instead, Biopure shifted

its focus to developing Hemopure for an entirely different application.

10. The Class Period begins on April 9, 2003, when Biopure first learned of FDA’s

clinical hold on the Trauma Clinical Trials, due to the FDA’s safety concerns about

Hemopure, arising from data submitted with the Hemopure BLA. The Class Period ends

on December 24, 2003, when Biopure issued a Press Release disclosing the clinical hold

and the Defendants’ receipt of Wells Notices from the SEC.

11. During all of part of the Class Period, the Defendants concealed from

investors the FDA’s clinical hold on Hemopure trials, due to the FDA’s safety concerns

about Hemopure, arising from data submitted with the Hemopure BLA; the FDA’s Complete

Response Letter; and the true extent and nature of the Hemopure BLA’s deficiencies as

outlined by the FDA in the Complete Response Letter. Throughout the Class Period, the

Defendants spoke optimistically about the prospects for FDA approval of the BLA and

falsely and deceptively continued to tout the potential use of Hemopure in the treatment of

trauma victims in multiple securities offerings, public filings, press releases, and conference

calls for investors. Particularly egregious was Biopure’s August 1, 2003 press release,

which, just two days after Biopure received the Complete Response Letter, sought to


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create the false impression that Biopure had received positive news from the FDA

regarding its pending Hemopure BLA. That day, Biopure’s publicly traded stock closed at

seven dollars and thirty cents ($7.30) per share, a twenty-two percent (22%) increase over

its previous day close.

12. The Class Period ends on December 24, 2003. As detailed below, on that

date, after the close of trading, Biopure issued a press release (the “December 24, 2003

Press Release”) in which it disclosed to the investing public, for the first time, the FDA’s

communication to Biopure, in April 2003, of the FDA’s safety concerns regarding Hemopure

and the FDA’s imposition of a clinical hold barring the Company from conducting the

Trauma Clinical Trials because of those safety concerns. Significantly, in that

December 24, 2003 Press Release, it was also disclosed that the Defendants Biopure,

Moore and Richman had received a “Wells Notice” from the staff of the SEC which advised

those Defendants that the staff of the SEC had preliminarily determined to recommend to

the SEC that it bring civil proceedings against them, because, during the time period

relevant to this litigation, they had made deceptive statements regarding Biopure,

Hemopure, the Hemopure BLA, and the Trauma Clinical Trials and they had not disclosed

that in April 2003, the FDA had expressed safety concerns about Biopure which led to the

imposition by FDA of a clinical hold on the Trauma Clinical Trials.

13. As demonstrated herein, the Defendants’ false, misleading and deceptive

public statements regarding Biopure, Hemopure, the Hemopure BLA, and the Trauma

Clinical Trials throughout the Class Period significantly and artificially inflated the price of

Biopure stock throughout the Class Period and caused the Plaintiffs and the members of

the Class to be damaged.


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JURISDICTION AND VENUE

14. This Court has jurisdiction of this action pursuant to Section 27 of the

Exchange Act (15 U.S.C. §78aa), and 28 U.S.C. §§1331 and 1337.

15. This action arises under and pursuant to Section 10(b) of the Exchange Act

(15 U.S.C. §78j(b)), Rule 10b-5 promulgated thereunder by the SEC (17 C.F.R.

§240.10b-5) and Section 20A of the Exchange Act (15 U.S.C. §78t-1).

16. Venue is proper in this District pursuant to Section 27 of the Exchange Act

and 28 U.S.C. §1391(b). Lead Plaintiff resides in this District, Biopure’s principal place of

business is located in this District and most of the acts complained of herein occurred in

this District.

17. In connection with the acts alleged in this Complaint, Defendants, directly or

indirectly, used the means and instrumentalities of interstate commerce, including, but not

limited to, the mails, interstate telephonic communications and the facilities of the

NASDAQ, a national securities exchange.

PARTIES

18. Lead Plaintiff Ronald Erickson (“Lead Plaintiff”) resides in Massachusetts.

As detailed in the Certification of the Lead Plaintiff, previously filed in this action (and

incorporated herein by reference), the Lead Plaintiff purchased 75,000 shares of Biopure

common stock during the Class Period. The Lead Plaintiff did not sell any Biopure common

stock during the Class Period.


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19. Plaintiff Stuart Gottlieb, as detailed in his Certification previously filed in this

action (and incorporated herein by reference) and as detailed herein, purchased shares of

Biopure common stock contemporaneously with the sales of Biopure stock by defendants

during the Class Period.

20. Plaintiff John G. Esposito, Jr., as detailed in his Certification, previously filed

in this action (and incorporated herein by reference) and as detailed herein, purchased

shares of Biopure common stock contemporaneously with the sales of Biopure stock by

defendants during the Class Period.

21. Plaintiff Emily A. Bittman, as detailed in her Certification previously filed in this

action (and incorporated herein by reference) and as detailed herein, purchased shares of

Biopure common stock contemporaneously with the sales of Biopure stock by defendants

during the Class Period.

22. Defendant Biopure is a Delaware corporation, with its headquarters in

Cambridge, Massachusetts.

23. The Defendant Thomas A. Moore (“Moore”) was, at all relevant times,

Biopure’s President and Chief Executive Officer, and a director of Biopure.

24. The Defendant Carl W. Rausch (“Rausch”) was, at all relevant times,

Biopure’s Vice Chairman and Chief Technical Officer, and a director of Biopure.

25. The Defendant Ronald F. Richards (“Richards”) was, at all relevant times,

Biopure’s Chief Financial Officer and Senior Vice President - Business Development.

26. The Defendant Howard P. Richman (“Richman”) was, during some of the

relevant time period, Biopure’s Senior Vice President of Regulatory Affairs and Operations.


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27. The Defendant Charles A. Sanders (“Sanders”) was, at all relevant times, a

director of and Chairman of the Board of Directors of Biopure.

28. The Defendant J. Richard Crout (“Crout”) was, at all relevant times, a director

of Biopure. Previously, he was a division chief for the FDA.

29. The Defendants Moore, Rausch, Richards, Richman, Sanders and Crout are

hereinafter sometimes collectively referred to as the “Individual Defendants.”

30. The Defendants Biopure, Moore, Rausch, Richards, Richman, Sanders and

Crout are hereinafter sometimes collectively referred to as the “Defendants.”

BACKGROUND

Background Information Regarding the FDA

31. The FDA is an agency within the United States Department of Health and

Human Services (“HHS”) and is responsible for promoting public health by promptly and

efficiently reviewing drug approval applications and clinical research, by taking appropriate

regulatory action on the marketing of regulated products in a timely manner, and by

ensuring that human drugs and devices are safe and effective.

32. The Center for Biologics Evaluation and Research (“CBER”) is a center within

the FDA that is charged with regulation of biologics (like Hemopure) intended for human

use. Biologics are products derived from living sources (in the case of Hemopure, from

cows). By contrast, drugs typically are chemically synthesized.

33. The FDA relies on CBER to issue the licenses it requires of companies which

manufacture biologics for introduction into interstate commerce. The process for obtaining

such a license involves several steps: (1) the manufacturer conducts initial laboratory and

animal testing, which do not require prior FDA approval; (2) the manufacturer submits an


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investigational new drug application (“INDA”) to the FDA seeking permission to conduct

human clinical trials concerning a particular indication; (3) after conducting clinical trials, the

manufacturer submits the BLA to FDA seeking approval of the biologic; and (4) the FDA

reviews the BLA, evaluating the manufacturer’s scientific and clinical data and determining

whether the biologic meets FDA standards.

34. At all times relevant, the FDA’s performance goals and procedures, which

were adopted in connection with the Prescription Drug User Fee Act of 1992 (“PDUFA”)

provided the FDA with ten months in which to review a BLA, subject only to a 90-day

extension if the BLA applicant submitted a major amendment within the last three months

of the review period. At the expiration of this review period, the FDA must either approve

the biologic product for marketing (if it met the FDA’s approval standards) or issue a

complete response letter which specified the problems with, or deficiencies in, the

application.

35. Generally speaking, the issuance of a complete response letter is a significant

negative development with respect to the chances of approval for any BLA. The BLA

applicant is able to make a further submission in an effort to address the FDA’s concerns

by answering all questions and addressing all deficiencies set forth in the complete

response letter. However, for all non-minor resubmissions, the PDUFA performance goals

and procedures specify that FDA has an additional six months within which to reply.

Background Information Regarding Biopure

36. Biopure manufactures only two products. One is Hemopure, which is

Biopure’s brand name for hemoglobin glutamer - 250 (bovine), an oxygen therapeutic

product that is derived from cow’s blood and that is intended to act as a substitute to red


10

blood cells in delivering oxygen to tissues in human beings. The other is Oxyglobin, an

oxygen therapeutic created solely for veterinary use.

37. To date, the FDA has not approved the use of Hemopure in human beings

for any indication. The only country in the world that has approved Hemopure for use in

human beings is South Africa, which has only approved it for use in extremely anemic

surgery patients.

38. From Biopure’s perspective, gaining FDA approval of Hemopure is absolutely

crucial to the continued viability of the Company. Since its founding in 1984, Biopure has

devoted substantially all of its resources to the research, development, and manufacturing

of Hemopure. Biopure has never been profitable and had an accumulated deficit of over

$380 million as of October 2002 and over $425 million in October 2003.

39. The following statements, from Management’s Discussion and Analysis of

Financial Condition and Results of Operations, January 31, 2003, filed by Biopure with the

SEC on March 17, 2003 in its quarterly report on Form 10-Q for the Quarterly Period ended

January 31, 2003 (the “January 2003 10-Q”), summarize Biopure’s history as follows:

Since its founding in 1984, Biopure has been primarily aresearch and development company focused on developingHemopure, our oxygen therapeutic for human use, andobtaining regulatory approval in the United States. Ourresearch and development expenses have been devoted tobasic research, product development, process development,pre-clinical studies, clinical trials and filing a BLA with theFDA....

* * *

Biopure is a leading developer, manufacturer and supplier ofpharmaceuticals called oxygen therapeutics. Using ourpatented and proprietary technology, we have developed andmanufacture two products. Hemopure is a first-in-classproduct for human use that is approved in South Africa for the


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treatment of acutely anemic surgical patients as an alternativeto red blood cell transfusion. On July 31, 2002, we submitteda biologic license application (BLA) to the FDA seekingregulatory approval to market Hemopure in the United Statesfor a similar indication in patients undergoing orthopedicsurgery....

* * *

Since inception, we have devoted substantially all of ourresources to our research and development programs andmanufacturing. We have been dependent upon funding fromdebt and equity financing, strategic alliances and interestincome. We have not been profitable since inception and hadan accumulated deficit of $392,713,000 as of January 31,2003. We expect to incur additional operating losses over thenext several years in connection with clinical trials, preparationof a marketing application for Hemopure in Europe and othermarkets and pre-marketing expenditures for Hemopure....

* * *

The completed Phase III orthopedic surgery trial costapproximately $37,000,000 over the four years from protocoldevelopment to final report. These trial costs include costsincurred at nearly 50 hospitals, trial site monitoring, datamanagement, regulatory consulting, statistical analysis,medical writing and clinical materials and supplies as well asCompany personnel engaged in these activities. Costsincurred in filing the BLA include Company personnel andpayments to third parties for manufacturing processdocumentation, medical consultants, regulatory consultants,integrating the safety and efficacy data bases for all clinicaltrials and pre-clinical studies. Research and developmentexpenses continue to include amounts for support of the BLAreview process including responding to FDA inquiries,preparing for and participating in FDA inspections of facilitiesand documentation and preparing for a possible FDA AdvisoryPanel presentation....

January 2003 10-Q, at 8, 10 - 11.

Background Information Regarding the Hemopure BLA


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40. On July 31, 2002, Biopure submitted the Hemopure BLA to the FDA, seeking

regulatory approval for the use and sale of Hemopure in the United States for anemic

patients undergoing orthopedic surgery. For Hemopure to receive such approval, Biopure

was required to demonstrate to the FDA that clinical trials of Hemopure had established

both its safety and its efficacy. Under the PDUFA goals and procedures, the FDA had until

approximately the end of May 2003 in which to complete its review of the Hemopure BLA

and either issue an approval letter or a complete response letter.

41. As part of the Hemopure BLA, Biopure submitted to the FDA data from the

Phase III clinical trials which it had conducted for the use of Hemopure for patients

undergoing orthopedic surgery, including adverse event data.

42. In a letter to Company shareholders dated February 4, 2003, which was

included within Biopure’s fiscal 2002 Annual Report, Defendant Moore discussed Biopure’s

priorities while touting the filing of the Hemopure BLA. Declaring that the Company

“realized a tremendous achievement” by filing the Hemopure BLA, Defendant Moore stated

that Biopure “anticipate[s] that the [FDA] will complete its review of our BLA by mid 2003.”

The letter also sets forth the Company’s “Business Strategy,” which included bullet points

concerning the Hemopure BLA (“[s]uccessfully launch Hemopure under an orthopedic

surgery indication in the United States”) and the Trauma Clinical Trials (“[c]linically develop

Hemopure for trauma, ischemia, and adjunctive cancer therapy indications”). Beneath the

heading “Changing Gears for the Future,” Defendant Moore wrote about Biopure’s

development of Hemopure for use in trauma victims, stating, “Our first clinical priority is to

demonstrate the product’s utility in stabilizing trauma patients in the emergency room and

pre-hospital, or ambulance, setting.”


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43. In September, 2002, Biopure received a grant from the United States

Department of the Army for the purpose of conducting clinical trials of Hemopure for the

treatment of certain trauma patients. In Biopure’s Annual Report for its fiscal year 2002,

filed with the SEC on Form 10-K on January 29, 2003, the Defendants said: “The

Company has identified trauma as its next clinical development priority and is

working with a committee of independent civilian and military trauma experts to

broaden its trauma program.” (Emphasis added.)

44. In light of the history and the nature of Biopure’s business, the most critical

and material information about Biopure during the Class Period was the status of the

Hemopure BLA, including all facts which bore on when the FDA would rule on the

Hemopure BLA and the likelihood that the FDA would (or would not) approve the BLA,

thereby approving (or not approving) Biopure’s sale of Hemopure in the United States for

use with orthopedic surgery patients. Accordingly, information regarding the Trauma

Clinical Trials, and particularly the FDA’s views and position that the Trauma Clinical Trials

would not be allowed to go forward due to the FDA’s safety concerns about Hemopure

arising from data submitted with the Hemopure BLA, was highly material information

regarding Biopure throughout the Class Period.

SUBSTANTIVE ALLEGATIONS

FDA Communicates to Biopure on April 9, 2003 thatIt Had Imposed A Clinical Hold on Biopure’s Trauma Clinical Trials

45. On or about March 7, 2003, Biopure submitted an INDA to the FDA seeking

permission to conduct the Trauma Clinical Trials. Biopure supported this submission by

relying upon, and referring to, clinical trial data previously submitted in support of its then-

pending Hemopure BLA.


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46. On or about April 9, 2003, FDA staff members contacted Defendant Richman,

Biopure’s primary contact person with the FDA, by telephone concerning the INDA. They

informed him that FDA was imposing a clinical hold, barring Biopure from initiating any

clinical trials connected with the trauma INDA, due to the “safety concerns” arising from

data related to the BLA clinical trials and based upon “a preliminary assessment of the

BLA.” In particular, the FDA staff members expressly referred to data concerning serious

adverse events that were experienced by BLA clinical trial participants, and stated that “the

trial was on hold for safety and that in FDA’s judgment it is unsafe to put this

product in this patient population at this time.”

47. Thus, as of April 9, 2003, the FDA had advised Biopure that it had placed

a clinical hold on their proposed clinical trial of Hemopure for the treatment of

trauma patients due to safety concerns arising from the FDA’s review of adverse

event data from the Company’s orthopedic surgery clinical trial, which had been

submitted as part of the Hemopure BLA.

48. Although not on the April 9, 2003 telephone call with the FDA, Defendant

Moore learned of the clinical hold the next day, April 10, 2003.

49. These communications in April 2003 from the FDA to the Defendants, were

highly material adverse information about Biopure, which would have significantly affected

the total mix of information available to an investor in Biopure common stock and which any

reasonable investor would have wanted to know in making an investment decision

regarding the Company.

50. The FDA’s safety concerns, as expressed on April 9, 2003, put Defendants

on notice that FDA approval of the Hemopure BLA, a prerequisite to the first commercial


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distribution of Hemopure in the United States, was in jeopardy and serious doubt and that

the FDA’s decision would, unquestionably, be delayed beyond the time frames previously

communicated by Defendants to the investing public. Nevertheless, over the next nine

months, throughout the Class Period, Defendants intentionally failed to disclose any of

these adverse material facts to the investing public - despite numerous opportunities to do

so in press releases, analyst conferences and conference calls, and SEC filings. Instead,

as detailed below, the Company’s periodic statements during the Class Period regarding

the Hemopure BLA and the Trauma Clinical Trials were false, deceptive, and fraudulent,

and they materially misled investors concerning the status of the Hemopure BLA and the

status of the Trauma Clinical Trials.

Biopure Issued Materially False and Misleading Statements to Class Members during the Class Period which Failed to Disclose

the Clinical Hold or Its Effect on the Hemopure BLA

51. Throughout the Class Period, the Defendants repeatedly issued and made

statements to the investing public and to Class Members about Biopure, Hemopure, the

Hemopure BLA, and the Trauma Clinical Trials. These statements were contained in

Biopure’s filings with the SEC; in press releases issued by Biopure (some of which

contained direct statements by the Defendant Moore); and in presentations and telephone

conferences by Moore and other Individual Defendants to securities analysts, investment

advisors and other members of the investing public.

52. As demonstrated and detailed below, the Defendants’ statements to Class

Members regarding Biopure, Hemopure, the Hemopure BLA, and the Trauma Clinical Trials

were false, deceptive and misleading because of the Defendants’ fraudulent failure to


1 After making that false and misleading statement, the Defendants added this “proviso:”

However, the FDA could change its view, require a change in study designor require additional data or even further clinical trials, including trials forindications other than those for which the pending applications seeksapproval, prior to approval of Hemopure. The FDA could refuse to grant amarketing authorization. Trials are expensive and time-consuming.Obtaining FDA approval generally takes years and consumes substantialcapital resources with no assurance of ultimate success.

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disclose the FDA’s safety concerns. Some of the Defendants’ false, deceptive and

misleading statements are detailed below.

Biopure Knowingly and Repeatedly Made False and Deceptive Statements in Its SEC Filings and Registration Statements which followed

the FDA’s April 9, 2003 Communication to Biopure of the Clinical Hold on the Trauma Clinical Trials

53. In numerous SEC filings which followed the April 9, 2003 disclosure to

Biopure of the FDA’s clinical hold, the Defendants, while purporting to disclose risks faced

by Biopure and its shareholders, knowingly and repeatedly made false and deceptive

statements regarding its Phase III Hemopure clinical trial. For example, in the Post-

Effective Amendment No. 2 to Form S-3 registration statement filed with the SEC on April

11, 2003 (the “April 11, 2003 Registration Statement Amendment”), the Company stated

as follows:

If We Fail to Obtain FDA Approval We Cannot MarketHemopure in the United States

We will not be able to market Hemopure in the United Statesuntil we receive FDA approval. We have filed an applicationfor approval with the FDA, and the application was acceptedfor review on October 1, 2002. We believe that ourcompleted pivotal Phase III clinical trials are consistentwith the FDA’s most recent guidance on the design andefficacy and safety endpoints required for approval ofproducts such as Hemopure for use in surgicalindications.1 (Emphasis added.)


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54. The statement quoted in the preceding paragraph, from the April 11, 2003

Registration Statement Amendment, including the portion of the quotation in the footnote,

is hereinafter referred to as the “False and Deceptive Statement Regarding ‘If We Fail to

Obtain FDA Approval.’”

55. The False and Deceptive Statement Regarding ‘If We Fail to Obtain FDA

Approval’ was false, deceptive and misleading in light of the FDA’s safety concerns

regarding Hemopure, which the Defendants failed to disclose to Class Members.

56. During the Class Period, the Defendants filed several registration statements

with the SEC, in each of which the Defendants repeated the False and Deceptive

Statement Regarding “If We Fail to Obtain FDA Approval,” nearly or fully verbatim, and

each of which contained the specific false statement emphasized in the above quoted False

and Deceptive Statement Regarding “If We Fail to Obtain FDA Approval.” Those

registration statements were false, deceptive and misleading because of the Defendants’

failure to amend this statement, to disclose the FDA’s safety concerns, and to disclose the

fact that FDA had as of April 9, 2003 communicated to Biopure that those safety concerns

resulted in FDA’s placing a clinical hold on the Trauma Clinical Trials. Those registration

statements filed within the Class Period, all of which were signed by all of the Individual

Defendants (except Richman), included the following:

a. April 11, 2003 Registration Statement Amendment;

b. Post-Effective Amendment No. 1 to Form S-3 registration statement filed with

the SEC on April 16 2003;

c. Form S-3 Registration Statement filed with the SEC on June 19, 2003; and


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d. Amendment No. 1 to Form S-3 registration statement filed with the SEC on

July 2, 2003.

57. The April 11, 2003 Registration Statement Amendment also contained the

following misleading and deceptive statements concerning the Company’s Hemopure BLA:

Research and development expenses continue to includeamounts for support of the BLA review process includingresponding to FDA inquiries, preparing for and participating inFDA inspections of facilities and documentation and preparingfor a possible FDA Advisory Panel presentation. These BLAsupport costs were $2,232,000 for the first fiscal quarter of2003 and are expected to continue at approximately the samelevel until the middle of this calendar year, when theCompany is hopeful that it will receive action by the FDAon the BLA.

* * *

If the FDA were to grant marketing approval for Hemopurethis calendar year, we anticipate that we would havematerial revenues from this project in fiscal 2004. We donot anticipate that we will attain profitability, however, until weare able to increase our manufacturing capacity. There aresubstantial risks and uncertainties relating to whether andwhen we will obtain FDA approval for Hemopure... . (Emphasisadded.)

58. The April 11, 2003 Registration Statement Amendment was signed by

Defendants Richards, Moore, Sanders, Rausch, Crout, and Biopure.

Biopure Begins Raising Money Through Stock Sales to Class Members Without Disclosing the FDA’s Clinical Hold

59. On or about April 16 - 17, 2003, after being informed by FDA of the clinical

hold on the Trauma Clinical Trials, Biopure filed with the SEC a Post-Effective Amendment

No. 1 to a Form S-3 Registration Statement that had been filed in March 2003 and Rule

424(b)(3) prospectus supplements (together, the “April 2003 Offering Documents”) for the

sale of up to 1 million shares of common stock and warrants for the purchase of up to


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500,000 shares of common stock. Defendant Moore substantially participated in the

drafting of the April 2003 Offering Documents, which he signed. Defendant Richman

reviewed the disclosures contained therein regarding the status of Biopure’s FDA

submissions, including the Hemopure BLA.

60. In the April 2003 Offering Documents, Biopure stated, inter alia:

We Cannot Expand Indications for Our Products Unless WeReceive FDA Approval for Each Proposed Indication

The FDA requires a separate approval for eachproposed indication for the use of Hemopure in the UnitedStates. We have applied for an indication for Hemopure thatwill only involve its periopoerative use in patients undergoingorthopedic surgery. Subsequently, we expect to expandHemopure’s indications. To do so, we will have to designadditional clinical trials, submit the trial designs to FDA forreview and complete those trials successfully....

* * *

The Company expects to initiate additional pre-clinical andclinical trials this year to expand the indications for Hemopurebeyond surgery.

* * *

We are also developing Hemopure for potential use in traumaand other medical applications.

61. Biopure’s April 2003 Offering Documents were false and misleading because

they misled investors about the true status of the Hemopure BLA and the Trauma Clinical

Trials, given the fact that FDA had by that point in time instituted a clinical hold on the

Trauma Clinical Trials. In particular, the April 2003 Offering Documents were false and

misleading to investors in four key respects. First, the April 2003 Offering Documents

falsely stated that Biopure had only applied for an indication involving Hemopure’s


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perioperative use in orthopedic surgery patients, when in actuality Biopure had also sought

permission to conduct the Trauma Clinical Trials. Second, though they discussed the

potential use of Hemopure in trauma victims, the April 2003 Offering Documents failed to

disclose that the FDA had instituted its clinical hold on the Trauma Clinical Trials due to

safety concerns which arose from the FDA’s preliminary assessment of the Hemopure

BLA. Third, the April 2003 Offering Documents disclosed a future “expectation” to expand

Hemopure’s indications and to design and submit additional trials for FDA review at a time

when Biopure had already designed additional clinical trials (the Trauma Clinical Trials),

submitted the trial designs for FDA review, and been notified that FDA instituted a clinical

hold. Fourth, the April 2003 Offering Documents referred to development plans for the

trauma indication without disclosing the clinical hold placed on the Trauma Clinical Trials

due to the FDA’s safety concerns.

62. On April 24, 2003, Biopure and Moore issued a press release which stated,

inter alia:

CAMBRIDGE, Mass., April 24/PRNewswire-FirstCall/ – BiopureCorporation (Nasdaq: BPUR) has appointed Ketchum toprovide public relations support and LifeBrands to providemedical education support for Biopure’s investigational oxygentherapeutic, Hemopure®...

The U.S. Food and Drug Administration is currently reviewingBiopure’s biologic license application “BLA” to marketHemopure in the United States. Ketchum and LifeBrands willprovide communications support for Hemopure and handleeducational activities surrounding the anticipated productintroduction in orthopedic surgery and the clinical developmentof other potential indications in trauma, ischemia and cancer.

“We look forward to successful partnerships with Ketchum andLifeBrands as we prepare to commercialize this first-in-classproduct,” said Thomas A. Moore, President and ChiefExecutive Officer of Biopure. “Based on our interactions


21

with the FDA and the guidelines in the Prescription DrugUsers Fee Act, we’re hopeful the agency will complete itsreview of our marketing application mid-year.”

Biopure is seeking FDA approval to market Hemopure for thetreatment of acutely anemic adult patients undergoingorthopedic surgery, and for the purpose of eliminating orreducing the need for red blood cell transfusions in thesepatients. As part of the BLA review process, the FDA hascompleted its inspections of Biopure’s manufacturing and data-handling facilities and has audited its contract researchpartners and several clinical sites in the United States andSouth Africa. Biopure has responded to all questions raised bythe FDA during the inspections and has resolved all previousmanufacturing documentation issues with the FDA. Hemopurecontinues to be manufactured and is available for shipment.(Emphasis added.)

63. The April 24, 2003 Press Release was false and misleading due to

Defendants’ failure to disclose in it the FDA’s clinical hold on the Trauma Clinical Trials and

the FDA’s reasons therefore.

FDA Confirms The Clinical Hold in Writing and Informs Biopure of Serious Safety Concerns Arising from the Pending Hemopure BLA

64. On or about April 25, 2003, the FDA sent a letter (the “April 25, 2003 FDA

Letter”) to Biopure that was addressed to Defendant Richman, in which it confirmed that

a clinical hold had been placed on the Trauma Clinical Trials sought by Biopure’s INDA

because “subjects would be exposed to an unreasonable and significant risk of injury.” The

April 25, 2003 FDA Letter reiterated that the clinical hold was predicated on safety concerns

which arose from the FDA’s preliminary assessment of the Hemopure BLA. Specifically,

the FDA stated, “[R]esults of a pivotal human trial, used in support of the Hemopure BLA,

and referred to in the IND[A], indicated that use of Hemopure, compared to human blood,

was associated with a higher incidence of life-threatening SAE’s [Serious Adverse Events],


22

including death and cardiac arrest.” Defendants Moore and Richman received a copy of

the April 25, 2003 FDA Letter at the latest by April 30, 2003.

Biopure Continues to Raise Money from Stock SalesWithout Disclosing the Clinical Hold or FDA’s Serious Safety Concerns

Arising from the Pending Hemopure BLA

65. On or about May 6, 2003, Biopure filed with the SEC two documents

(together the “May 2003 Prospectus Supplements”): (1) a Rule 424(b)(3) prospectus

supplement to the April 2003 Offering Documents dated May 2, 2003 and (2) a Rule

424(b)(3) prospectus supplement to the April 2003 Offering Documents dated May 5, 2003.

The May 2003 Prospectus Supplements incorporated by reference certain of Biopure’s

prior public filings (including prior offering documents and periodic reports) and, taken

together, provided for the sale of up to 1,715,687 shares of common stock and warrants

to purchase up to 343,138 shares of common stock. Defendant Moore substantially

participated in the drafting, review, and/or approval of the May 2003 Prospectus

Supplements. Defendant Richman reviewed the disclosures contained therein regarding

the regulatory status of Biopure’s FDA submissions, including the Hemopure BLA.

66. The May 2003 Prospectus Supplements were false and misleading because

they failed to disclose that FDA had implemented a clinical hold barring the Trauma Clinical

Trials from proceeding due to safety concerns which arose out of FDA’s preliminary

assessment of the Hemopure BLA. They were further misleading insofar as they

incorporated by reference, rather than amending, the false and misleading statements and

omissions contained in the April 2003 Offering Documents.


23

Biopure Unsuccessfully Petitions the FDA to Lift the Clinical Hold While Continuing to Raise Money from Stock Sales

Without Disclosing the Clinical Hold or FDA’s Serious Safety Concerns Arising from the Pending Hemopure BLA

67. On May 12, 2003, in response to the FDA’s clinical hold on the Trauma

Clinical Trials, Biopure made an extensive submission to the FDA requesting that the hold

be lifted. Termed a “complete response” to the FDA’s April 25, 2003 FDA Letter, the

submission was signed by Defendant Richman, who, along with Defendant Moore,

participated in its drafting and review.

68. On or about May 14, 2003, Biopure filed a Form 8-K with the SEC (“May 2003

Form 8-K”), which Defendant Moore reviewed and approved before filing. It attached as

an exhibit a Standby Equity Distribution Agreement dated April 16, 2003 between Biopure

and BNY Capital Markets, Inc. (“BNYCMI”), under which Biopure could issue and sell up

to $10 million of class A common stock periodically through BNYCMI, as Biopure’s

exclusive agent for the offer and sale of the shares. The May 2003 Form 8-K disclosed

certain of the agreement’s terms, including Biopure’s representation and warranty that the

Company’s registration statements and prospectuses:

...conformed and will conform in all material respects to therequirements of the Exchange Act and the rules andregulations of the [Securities and Exchange] Commissionpromulgated thereunder, and none of such documentscontained or will contain at such time an untrue statement of amaterial fact or omitted or will omit to state a material factnecessary to make the statements therein, in the light of thecircumstances under which they were made, not misleading.

69. The May 14, 2003 May 2003 Form 8-K was false and misleading because,

as discussed herein, both the April 2003 Offering Documents and the May 2003 Prospectus

Supplements contained untrue statements of material fact and/or omitted to state material


24

facts necessary to make the statements therein, in the light of the circumstances under

which they were made, not misleading.

70. On May 22, 2003, Biopure issued a press release announcing its Q2 results

for fiscal 2003 (“May 22, 2003 Press Release”) and included the text of the release in a

Form 8-K filed with the SEC (“May 2003 Form 8-K”). Defendants Moore and Richman each

substantially participated in the drafting, review, and/or approval of the May 22, 2003 Press

Release.

71. The May 22, 2003 Press Release contained a section entitled “Recent

Corporate Events” which listed, inter alia, a statement referring to the Trauma Clinical Trials

(“Biopure is preparing for a Phase 2a in-hospital trauma trial.”). This was misleading

because Biopure omitted to state that the FDA had instituted a clinical hold on the Trauma

Clinical Trials due to safety concerns that arose from its preliminary assessment of the

Hemopure BLA. In addition, the May 22, 2003 Press Release made the following

misleading and deceptive statements regarding the Hemopure BLA and the Trauma

Clinical Trials:

Based upon FDA performance goals and guidelines in thePrescription Drug User Fee Act (PUDFA), Biopure is hopefulthat in mid 2003 the FDA will complete its review and acton Biopure’s biologic license application (BLA) to marketHemopure in the United States for the treatment of acutelyanemic adult patients undergoing orthopedic surgery. Aspart of this review, the agency has inspected the company’smanufacturing and data-handling facilities and has audited itscontract research partners and several clinical sites in theUnited States and South Africa. Biopure has responded toall questions raised by the FDA to date. (Emphasis added).

The U.S. Army has notified Biopure that the company willreceive approximately $4 million in FY03 Congressionalfunding, in addition to a $908,900 grant previously awarded inFY02 [footnote omitted], designated to fund trauma trials of


25

Hemopure in emergency rooms and ambulances. In addition,in March 2003 Biopure and the Naval Medical ResearchCenter (NMRC) signed a collaborative research anddevelopment agreement (CRADA) to help fund and conduct apivotal trauma trial of Hemopure. Participation in thiscollaborative effort is estimated to cost the NMRC at least $4million. Biopure will contribute an estimated $8.7 million, ofwhich at least $643,000 will be provided during the first year.Biopure is preparing for a Phase IIa in-hospital trauma trial,and the study protocols for Phase Iib/pivotal pre-hospital trialare currently under scientific review by the NMRC.

72. On May 22, 2003, the Defendants Biopure, Moore, Richards and Richman

participated in a telephonic conference call for analysts and institutional investors (the “May

22, 2003 Investor Call”). As described below, a live audio webcast of the conference call

was available to all members of the investing public. A copy of the transcript of that

conference call, prepared by CCBN StreetEvents, for Biopure, is attached hereto as Exhibit

C, and incorporated herein by reference.

73. During the May 22, 2003 Investor Call, the Defendants made statements and

answered questions from public participants, about Biopure, the Hemopure BLA and the

Trauma Clinical Trials, which were false, deceptive and misleading. For example, the

Defendant Moore made the following false, deceptive and misleading statements during

the May 22 Conference Call:

a. “...we continue to be very hopeful of an [FDA] response onour [biologic] license application by mid-year or sooner, and wecontinue to not be aware of any major issues with thatapplication at this time....”

b. “On FDA I’ll just reiterate, I guess, at our last quarter we ...had answered all FDA questions and we were unaware ofany major issues. Fundamentally we’re in the same placenow.”


26

c. “We continue to say we are not aware of anything thatwould cause undue delay [in receiving a response from theFDA to the Hemopure BLA]...”

d. “Our aim will be to have the product, again, assumingwe get approved, on or about June 1st to the end business[sic] and moving product no later than October 1st.”

e. “Parkman Hospital is going to be our initial clinicalcenter to conduct the already announced in-hospitaltrauma trials that will set us up for the subsequent pre-Hospital trials to establish an additional trauma indication forHemopure.”

(Exhibit C at 1 and 2, emphasis added).

74. The May 22, 2003 Investor Call was false and misleading because

Defendants Moore and Richman misrepresented the true information that Biopure had

received from the FDA in several ways. First, the statement that “we continue to not be

aware of any major issues with that application at this time” was false and misleading

because the FDA had already informed Biopure about serious safety concerns from the

clinical trial information submitted in support of the Hemopure BLA, which had resulted in

the FDA’s imposing a clinical hold on the Trauma Clinical Trials. Second, the reference to

Parkman Hospital as being Biopure’s “initial clinical center to conduct the already

announced in-hospital trauma trials” was misleading because it failed to disclose that the

FDA’s clinical hold barred those trials from taking place. Third, it was misleading to tout the

potential for using Hemopure in trauma victims at all because doing so failed to disclose

that FDA had instituted a clinical hold based upon safety concerns which arose based on

FDA’s preliminary assessment of the Hemopure BLA.

75. Those statements were made directly by the Defendants Moore, Richman,

and Biopure, but they also constituted statements by Defendant Richards, in light of the fact


27

that, while participating in the May 22, 2003 Investor Call, he acquiesced in and did not, in

any way, correct those statements which he knew to be false, deceptive and misleading.

76. All of the statements made by the Defendants during the May 22, 2003

Investor Call were available to all members of the investing public. Specifically, as stated

in the May 23, 2003 Press Release:

Biopure President and CEO Thomas A. Moore will host aconference call at 4:30 p.m. EDT on Thursday, May 22, 2003,to briefly review the company’s activities and financial position.The dial-in numbers for analysts and institutional investors are1-800-387-5428 (US/Canada) and 1-706-634-1328(International).

A live webcast of the conference call will be available from theinvestors section of Biopure’s web site at www.biopure.comand will be archived for 30 days. The webcast can also beheard by individual investors at www.companyboardroom.comand by institutional investors who subscribe to StreetEvents atwww.streetevents.com. An audio replay of the conference callwill be available from approximately 7:30 p.m. EDT, May 22,2003, until midnight May 30, 2003. To access the replay, dial1-800-642-1687 (US/Canada) or 1-706-645-9291(International/Local) and Reference Conference ID number438897.

Biopure’s Submission Fails to Persuade the FDA to Lift the Clinical Hold on the Trauma Clinical Trials

77. On or about May 30, 2003, the FDA sent two letters to Biopure (“May 30,

2003 FDA Letters”), addressed to Defendant Richman, in response to Biopure’s May 12,

2003 request that the clinical hold on the Trauma Clinical Trials be lifted. In one letter, the

FDA stated that Biopure’s request contained serious inconsistencies and failed to address

any of FDA’s safety concerns which prompted the clinical hold. Also, the FDA informed

Biopure that, with respect to Hemopure, its “conclusions about product safety


28

remain unchanged.” Further, the FDA required Biopure to conduct “at least three

additional studies in conscious swine” to address particular concerns before any human

testing could occur. In the other letter, the FDA told Biopure that it was extending the

deadline to complete its review of the Hemopure BLA for 90 days - until August 29, 2003 -

because Biopure’s May 12, 2003 request to lift the clinical hold contained significant new

analyses of the Hemopure clinical data and therefore constituted a “major amendment” to

the Hemopure BLA.

78. Defendants Moore and Richman received copies of both of the May 30, 2003

FDA Letters on our about May 30, 2003.

Biopure Disseminated False Reasons for the FDA’s 90-Day Extension, which ItMisleadingly Characterizes as Positive News for the Hemopure BLA

79. On May 30, 2003, after receiving both of the May 30, 2003 FDA Letters,

Biopure issued a press release (the “May 30, 2003 Press Release”) announcing that the

FDA had notified Biopure that it had extended the time for it to act on the Hemopure BLA

for an additional 90 days, until August 29, 2003. Defendants Moore and Richman

substantially participated in the drafting, review and approval of the May 30, 2003 Press

Release. In it, Biopure explained the FDA’s action as follows:

Biopure submitted its BLA on July 31, 2002. Under FDAperformance goals in the Prescription Drug User Fee Act(PDUFA III), the agency has up to 10 months from thesubmission date to review and act on the BLA, making theoriginal action due date June 1, 2003. As part of the normalreview process, Biopure has responded to FDA questionsregarding the application. The agency has classified the latestresponses submitted in mid-May 2003 as additional analysesof previously submitted data, which under FDA standardoperating procedures automatically provides the agency up tothree months beyond the original action due date to review thedata. This type of action is not unusual–the last 11 standard


29

BLAs accepted for review by the FDA have undergone a 13-month review.

80. In the May 30, 2003 Press Release, the Defendant Moore made the following

statement regarding the FDA’s action:

“We’re very pleased with the FDA’s progress in reviewing ourapplication,” said Biopure President and CEO Thomas A.Moore. “We continue to work closely with the agency towarda final decision that will allow us to make Hemopure availableas an alternative to red blood cell transfusion. We’re alsocontinuing our preparations to roll out the product to leadingorthopedic surgery centers following approval.”

81. The May 30, 2003 Press Release was false and misleading in several ways

about the true information that Biopure had received from the FDA. First, it falsely stated

that Biopure had responded to the FDA regarding the Hemopure BLA, when in actuality the

Company had responded to questions about the trauma INDA and the clinical hold, which

it had still not disclosed. Second, it falsely stated that Biopure’s submission was “part of

the normal review process” of the Hemopure BLA and constituted Biopure’s “latest

responses” to FDA questions about the Hemopure BLA when in actuality the submission

was the Company’s “complete response” to the April 25, 2003 FDA Letter and was

submitted for the sole purpose of trying to persuade the FDA to lift the clinical hold. Third,

the May 30, 2003 Press Release failed to disclose, inter alia, that the FDA had placed the

trauma INDA on clinical hold due to safety concerns over the data submitted in support of

the Hemopure BLA, that the 90-day extension imposed by FDA was the result of Biopure’s

request to lift the clinical hold, and that the FDA had refused to lift the clinical hold even

after the Company had made a substantial submission to FDA requesting that the hold be

lifted.


30

82. In the May 30, 2003 Press Release, Biopure also announced that it would

hold a conference call on May 30, 2003 at 3 pm ET, at which it “will discuss the regulatory

status of Hemopure...” (hereinafter, the “May 30, 2003 Investor Call”). Like the May 22,

2003 Investor Call, analysts and institutional investors could participate and all members

of the investing public could hear the call live and access it thereafter for a period of time.

A copy of the transcript of the May 30 Conference Call, entitled Biopure Corporation

Conference Call to Discuss the Regulatory Status of Hemopure, prepared by CCBN

StreetEvents, for Biopure, is attached hereto as Exhibit D, and incorporated herein by

reference.

83. The Defendants Moore, Richman and Richards participated in the May 30,

2003 Investor Call on behalf of Biopure. Defendant Moore made the following false,

deceptive, and misleading statements which were intended to falsely characterize the 90-

day extension imposed by the FDA as a positive development:

We view this notification [of the 90-day extension] as a verypositive development for Hemopure. First of all, we have adate which the agency has indicated their intent to give us anaction letter. Second, it confirms what we already knew, thatis, that the agency has devoted considerable effort to thisapplication. And third, as we also already knew, that now ourinvestor community knows, there is nothing in our applicationwhich is warranted a denial of that application at the three keydecision points we’ve passed so far in the PDUFA process. Bythat, I mean our BLA was accepted, it was also continuedthrough the mid-cycle review conducted by the agency, andnow, at the PDUFA guideline date for a first response, we’venot had a denial, but rather a going forward to additionalconsideration. The added time we’re going to get over the nextthree months will not only allow us to insure we can fullyanswer additional questions the FDA might choose to send ourway, but also allow us to complete legal negotiations and tocontinue forward with the commercial preparations we aremaking against a hopeful approval on August 29th for thename of introducing this product on or about the October


31

introductory guideline we mentioned in our conference call lastweek. So we feel very positive about this....

(Exhibit D at 1-2).

84. As reflected in the transcript, the analysts participating in the May 30, 2003

Investor Call expressed concern about the fact that the FDA had extended the time for it

to act on the Hemopure BLA for an additional 90 days, until August 29, 2003. They asked

pointed questions regarding the reasons for that delay by the FDA, to which the Defendants

gave false, deceptive and misleading responses. Some of that colloquy was as follows:

Sapna Srivastava - Think Equity - Analyst

[D]id the FDA request any additional data to be submitted, orwhy do you think that basically the FDA extended the time linefor the review process?

Thomas A. Moore – Biopure - CEO and President

The FDA did not request any additional data. . . .

Howard P. Richman - Biopure - SVP Regulatory Affairs &Operations

. . . This is what normally happens with any submission. AsTom has told the public over the past many months, is that weare in continued dialogue with the agency and during thatperiod of time, they have requested information which we havesent back to them. It’s a normal process with any application.Be that as it may, the agency, during the course of reviewingthe information has the opportunity to take additional time toallow them to give a complete and additional thorough reviewof all information to make a thorough conclusion on application.This type of response from the FDA is very common withbiologic licensing applications. ...

* * *

Richard Adams - Bennett Lawrence - Analyst

...why are you still having to provide information to the FDA?You said mid-May there was a resubmission of some sort.


32

Why nine and a half months after the original BLA wassubmitted are you still having to provide information?


...This mid-May submission was some additional analysiswhich we provided on data that was already in the BLA. At thetime, we didn’t consider it a major amendment to the BLA butthe FDA looked at that as a reason to extend it...


. . . Just as a point of clarification this is a normal occurrence.I’ve been lucky to be involved with 12 other approval processesoutside of Biopure and this is a normal thing that happens.We’re, in fact, in constant contact with the agency when they’rerequesting information in real time. So this is not anything newthat can happen. And what we have done is supply responsesback to their continual questions to allow them, again, as Imentioned earlier, to give complete and thorough response tothis first in class application.

Richard Adams – Bennet Lawrence - Analyst

...but it would seem that for there to be some sort ofsubmission that would extend the PDUFA date another twomonths, it would have to be something material. And I guessI’m just surprised that nothing was disclosed in mid-May whenthis additional submission was made.


To be clear, we were simply responding to a new set ofquestions from FDA. It did not involve any new data. And sofrankly, it was well within the range of other questions we’veanswered in the past. When we made that response, we didn’tcharacterize it as a major amendment to the BLA...

* * *

Gabe Hoffman - Occipital Capital - Analyst

...Could you please be a little more specific in terms of – thecompany has submitted additional analyses of previously


33

submitted data. Could you be a little more specific as to whatelements of the clinical data that that refers to?


I can’t be a lot more specific.

Gabe Hoffman – Occipital Capital - Analyst

I mean, is it safety, is it statistical procedure, is it someauditing of patient records? I mean, could you just besomewhat more specific?


Well, all patient records have been audited and so all that’sbeen done, so that’s not at issue as far as I know anyway.

Gabe Hoffman – Occipital Capital - Analyst

Or merely is it formatting or you know?


It’s actually – it was a dialogue really about how to look at theclinical data. As you know, there are various analyses used tolook at our efficacy and safety data and we just had a dialogueabout the different ways you could look at the analyses that areperformed on the data. And that’s really as far as I want tocharacterize it.


But could you just give us maybe a broader ballpark sense asto – you know, just a broad area that it is – is there a specificarea that it’s in that’s a broad area that maybe you couldcharacterize it? That’s more specific than just it’s the clinicaldata?


Well, I mean, all the clinical data has to do with safety andefficacy. That’s the only thing in measure in these clinicals.And so, the dialogue is over those clinical and safety andefficacy data. And again, we have answered some questionson a pretty broad basis. When I talk about it as how to look at


34

the clinical analysis, it’s exactly what it was. So I think that’s asfar and as specific as I really want to be at this point.

* * *

Roberto McNuln - Bridger Capital - Analyst

To get some more information about the additional data askedfor – given your assessment that the questions asked werevery broad, I’m still unclear as to why then at this late in thedate it would require a three month delay. I would understandif the questions were very detailed that the FDA would ask for– would take that additional time. But your assessment of thequestions being very broad makes me want to get some moredetail about that.


...the FDA chose to look at this as a major amendment to theBLA...if we submit new information about any aspect of theproduct or new analysis about any aspect of the product,whether it’s pivotal to their decision or not, they can decide thatthat’s a reason to go for the extension. So I’m not surewhether or not the data we submitted, we did not submit anynew data, whether that was a reason for the extension ofwhether the echo simply needed an extension, period.

(Exhibit D at 2-5 and 7).

85. The May 30, 2003 Investor Call, including those statements, was false,

deceptive and misleading in light of the FDA’s safety concerns, the clinical hold imposed

on the Trauma Clinical Trials after a preliminary assessment of the Hemopure BLA, and

the impact of both on the Hemopure BLA - all of which the Defendants failed to disclose.

Further, Defendants falsely optimistically characterized the 90-day extension as part of a

normal, ongoing dialogue with FDA about the Hemopure BLA when in actuality it was

necessitated by Biopure’s submission seeking to address the FDA’s safety concerns and

lift the clinical hold. Those statements were made directly by the Defendants Moore,

Richman, and Biopure, and they also constituted statements by Defendant Richards, in


35

light of the fact that, while participating in the May 30, 2003 Investor Call, he acquiesced

in and did not, in any way, correct those statements which he knew to be false, deceptive

and misleading.

Biopure Continues to Conceal the Clinical Hold from the Public in Periodic Reports and Offering Documents Filed with the SEC

86. On or about June 16, 2003, Biopure filed its quarterly report on Form 10-Q

with the SEC for the quarter end April 30, 2003 (the “April 2003 10-Q”). Defendant Moore

substantially participated in the drafting, review and/or approval of the non-financial

reporting sections, and Defendant Richman reviewed disclosures regarding the regulatory

status of Biopure’s submissions to the FDA. The April 2003 10-Q contained the False and

Deceptive Statement Regarding “If We Fail to Obtain FDA Approval” and the following false

and deceptive statement:

If the FDA grants marketing approval for Hemopure thiscalendar year, we anticipate that we would have materialrevenues from this project in fiscal 2004. We do notanticipate that we will attain profitability, however, until we areable to increase our manufacturing capacity. There aresubstantial risks and uncertainties relating to whether andwhen we will obtain FDA approval for Hemopure... . (Emphasisadded.)

April 2003 10-Q, at 16.

87. The April 2003 10-Q was signed by the Defendant Richards. Furthermore,

as required by SEC Rules 13a-14(a) and (b) and 15d-14(a) and (b), promulgated pursuant

to the Exchange Act, the April 2003 10-Q contained certifications by the Defendant Moore,

as the Chief Executive Officer of Biopure and the Defendant Richards, as the Chief

Financial Officer of Biopure, in which they each certified:

1. I have reviewed this quarterly report on Form 10-Q ofBiopure Corporation;


2 Exchange Act Rules 13a - 14(c) and 15d -14(c) define “disclosure controls andprocedures” as follows:

...controls and other procedures of an issuer that are designed to ensurethat information required to be disclosed by the issuer in the reports that itfiles or submits under the Act is recorded, processed, summarized andreported, within the time periods specified in the Commission’s rules andforms. Disclosure controls and procedures include, without limitation,controls and procedures designed to ensure that information requiredto be disclosed by an issuer in the reports that it files or submits underthe Act is accumulated and communicated to the issuer’smanagement, including its principal executive officer or officers andprincipal financial officer or officers... (Emphasis added.)

36

and in which they then falsely certified:

2. Based on my knowledge, this quarterly report doesnot contain any untrue statement of a material fact oromit to state a material fact necessary to make thestatements made, in light of the circumstancesunder which such statements were made, notmisleading with respect to the period covered by thisquarterly report; [emphasis added]

Id., at 35 - 36.

88. The Defendants Moore and Richards also certified that Biopure and they had

designed “disclosure controls and procedures” which would have ensured that they would

have learned of any FDA safety concerns, so they could have been timely and properly

disclosed to the investing public in the April 2003 10-Q. Specifically, Moore and Richards

certified that:

4. The registrant’s other certifying officers and I areresponsible for establishing and maintaining disclosurecontrols and procedures (as defined in Exchange ActRules 13a - 14 and 15d -14)2 for the registrant and wehave:

a) designed such disclosure controls andprocedures to ensure that material informationrelating to the registrant, including itsconsolidated subsidiaries, is made known to usby others within those entities, particularly during


37

the period in which this quarterly report is beingprepared;

b) evaluated the effectiveness of the registrant’sdisclosure controls and procedures as of a datewithin 90 days prior to the filing date of thisquarterly report (the “Evaluation Date”); and

c) presented in this quarterly report ourconclusions about the effectiveness of thedisclosure controls and procedures based on ourevaluation as of the Evaluation Date...

Id., at 35-36.

89. The “conclusions about the effectiveness of the disclosure controls and

procedures” referenced in the above quoted certification by Moore and Richards, set forth

in the April 2003 10-Q, were as follows:

(a) Under the supervision and with the participation of ourmanagement, including our Chief Executive Officer and ChiefFinancial Officer, we conducted an evaluation of theeffectiveness of the design and operation of our disclosurecontrols and procedures (as defined in Rules 13a-14(c) and15d-14(c) under the Securities Exchange Act of 1934, asamended (the “Exchange Act”)) within 90 days of the filing dateof this Quarterly Report on Form 10-Q (the “Evaluation Date”).Based on this evaluation, our Chief Executive Officer and ChiefFinancial Officer concluded as of the Evaluation Date that ourdisclosure controls and procedures were effective to ensurethat information required to be disclosed by us in our ExchangeAct reports is recorded, processed, summarized and reportedwithin the time periods specified in Securities and ExchangeCommission rules and forms.

Id., at 22.

90. On or about June 19, 2003, Biopure filed a Form S-3 registration statement

and prospectus and on or about July 2, 2003, Biopure filed a Pre-effective Amendment No.

1 for Form S-3 registration statement and prospectus with the SEC for the sale of common

stock and warrants for the purchase of common stock (together, the “Summer 2003


38

Registration”). On or about July 3, 2003, Biopure filed a Rule 424(b)(3) prospectus with the

SEC for the sale of common stock and warrants for the purchase of common stock (“July

2003 Prospectus”). Defendant Moore signed the Summer 2003 Registration and

substantially participated in the drafting, review and approval of both it and the July 2003

Prospectus. Defendant Richman reviewed the disclosures concerning the regulatory status

of the Company’s FDA submissions.

91. The April 2003 10-Q, the Summer 2003 Registration, and the July 2003

Prospectus were all false and misleading with respect to the true status of Biopure’s

Trauma Clinical Trials. These documents failed to disclose the FDA clinical hold which

barred Biopure from conducting the Trauma Clinical Trials due to safety concerns identified

after a preliminary assessment of the Hemopure BLA. They were misleading in stating that

the “only” application applied for was an indication involving Hemopure’s perioperative use

in orthopedic surgery when in actuality Biopure had also applied for permission to conduct

the Trauma Clinical Trials. They were also misleading by discussing a future “expectation”

to expand Hemopure’s indications and to design additional trials and to submit them to FDA

for review when in actuality Biopure had already designed additional trials (the Trauma

Clinical Trials), submitted their designs to FDA, and received a clinical hold due to safety

concerns.


39

Biopure Unsuccessfully Petitions the FDA Again to Lift the Clinical Hold on the Trauma Clinical Trials While Continuing to Raise Money from Stock Sales

Without Disclosing the Clinical Hold or FDA’s Serious Safety ConcernsArising from the Pending Hemopure BLA

92. On or about July 2, 2003, Biopure made a submission to the FDA, in

response to the May 30, 2003 FDA Letters, in yet another attempt at having the clinical

hold lifted. Defendant Richman prepared and signed this submission at the direction of

Defendant Moore, who reviewed it before it was sent to the FDA.

93. On or about July 17, 2003, Biopure filed a Form 8-K with the SEC (“July 2003

Form 8-K”), which was reviewed and approved by Defendant Moore prior to filing. The July

2003 Form 8-K attached as an exhibit a “Placement Agency Agreement,” dated July 17,

2003, between Biopure and ThinkEquity Partners, LLC (“TEP”), pursuant to which TEP was

to act as exclusive placement agent for the Company in its sale of up to $17.22 million of

class A common stock. Among the terms of the agreement with TEP that were disclosed

in the July 2003 Form 8-K was Biopure’s representation and warranty that its registration

statements and prospectuses:

...conformed and will conform in all material respects to therequirements of the Exchange Act and the rules andregulations of the [Securities and Exchange] Commissionpromulgated thereunder, and none of such documentscontained or will contain at such time an untrue statement of amaterial fact or omitted or will omit to state a material factnecessary to make the statements therein, in the light of thecircumstances under which they were made, not misleading.

94. The July 2003 Form 8-K was false and misleading because, inter alia,

Biopure’s prior SEC filings themselves contained untrue statements of material fact or

omitted to state material facts necessary to make the statements therein, in the light of the

circumstances under which they were made, not misleading.


40

95. On or about July 18, 2003, Biopure filed a Rule 424(b)(5) prospectus

supplement to the July 2003 Prospectus for the sale of up to 3,083,000 common stock

shares to institutional investors (the “July 2003 Offering Document”). It incorporated by

reference certain of the Company’s prior public filings, including offering documents and

periodic reports. Defendant Moore substantially participated in the drafting, review, and/or

approval of the July 2003 Offering Document. Defendant Richman reviewed disclosures

concerning the regulatory status of Biopure’s FDA submissions.

96. The July 2003 Offering Document was false and misleading because, inter

alia, it failed to disclose the FDA’s clinical hold on the Trauma Clinical Trials due to safety

concerns that had arisen during the preliminary review of the Hemopure BLA and because

it incorporated by reference prior filings (discussed herein) which likewise contained false

statements and omissions.

97. On July 23, 2003, Biopure issued a press release announcing that it had

raised $17.2 million in gross proceeds through the sale of 3,083,000 shares of its common

stock at $5.58 per share.

The FDA Refuses to Approve Hemopure, Issues Biopure a Complete Response Letter to the Hemopure BLA, and Refuses to Lift the Clinical Hold

on the Trauma Clinical Trials

98. On July 30, 2003, Biopure received two highly significant letters from the

FDA. One was a letter once again refusing to lift the clinical hold on the Trauma Clinical

Trials (the “July 30, 2003 Trauma Clinical Trials Letter”). It was received by Defendants

Moore and Richman on or about July 30, 2003 and about which Biopure’s General Counsel

was made aware no later than July 31, 2003. The other was FDA’s Complete Response

Letter (the “Complete Response Letter”), Exhibit B hereto, in which FDA informed Biopure


41

that its Hemopure BLA was not approved due to the FDA’s safety concerns about

Hemopure arising from data submitted with the Hemopure BLA. Defendants Moore and

Richman and Biopure’s General Counsel all received copies of the Complete Response

Letter on or about July 30, 2003.

99. From July 30, 2003 until December 11, 2003, Defendants continued to

mislead investors through numerous public filings, press releases, and statements, by

failing to disclose Biopure’s receipt of the FDA’s Complete Response Letter (despite the

fact that FDA staff and Biopure’s own outside regulatory counsel repeatedly and

consistently identified the letter to Defendants as being a “complete response letter”), by

misrepresenting the nature and extent of the deficiencies in the Hemopure BLA raised by

the FDA, and by failing to disclose the continued existence of the FDA’s clinical hold on the

Trauma Clinical Trials, as well as FDA’s refusal to lift the hold despite repeated requests

by Biopure that it do so.

100. The Complete Response Letter’s opening sentences set forth the FDA’s

unambiguous rejection of the Hemopure BLA, stating:

The Center for Biologics Evaluation and Research (CBER) hascompleted the review of all submissions made relating to yourBiologics License Application. Our review finds that theinformation and data submitted are inadequate for finalapproval action at this time because on the deficienciesoutlined below.

Exhibit B at 1 (emphasis added).

101. The Complete Response letter also summarized the numerous deficiencies

which the FDA found in Biopure’s Hemopure BLA - a process which took the FDA 34

single-spaced pages to accomplish. See Exhibit B. Altogether, the Complete Response

Letter contained over 220 individual deficiencies and questions concerning Biopure’s


42

clinical trials and data submitted in support of the Hemopure BLA and concerning the safety

and efficacy of Hemopure. Id.

102. The most significant deficiencies and questions raised in the FDA’s Complete

Response Letter concerned the conduct of Biopure’s clinical trials and the integrity of the

data, in particular the following: (1) whether adequate controls had been used to ensure

that the data underlying Biopure’s Hemopure BLA was sufficiently accurate and reliable to

form the basis for conclusions by the FDA about Hemopure’s safety and efficacy, and (2)

why Biopure had failed to perform certain analyses that the FDA had expected and

recommended be performed. In addition, the FDA expressly reserved the right to re-

evaluate Hemopure’s safety and efficacy pending the resolution, if any, of the data integrity

issues it brought to Biopure’s attention in the Complete Response Letter.

103. The Complete Response Letter also stated that the review clock regarding

Hemopure was suspended as of its issuance. In essence, the FDA informed Biopure via

the Complete Response Letter that it was taking no further action on the Hemopure BLA

unless and until Biopure could resolve to its satisfaction all of the 220 deficiencies that FDA

raised concerning the Hemopure BLA.

104. In the July 30, 2003 Trauma Clinical Trials Letter, the FDA once again refused

to lift the clinical hold it had placed on the Trauma Clinical Trials because, in the FDA’s

words, “human subjects are or would be exposed to an unreasonable and significant

risk of illness or injury.” In support of that conclusion, the FDA cited many of the same

deficiencies, questions, and concerns raised in the Complete Response Letter regarding

the Hemopure BLA, the adequacy of controls concerning Biopure’s prior Hemopure clinical

trials and the analysis of the resulting data, and the safety of Hemopure.


43

105. The importance of Biopure’s receipt, on July 30, 2003, of the Complete

Response Letter and the July 30, 2003 Trauma Clinical Trials Letter cannot be overstated.

The letters were lengthy, detailed, and together spelled out an insurmountable array of

deficiencies in the Hemopure BLA which essentially signaled the death knell for Biopure’s

chances of ever gaining FDA approval for Hemopure. This defeat was especially

pronounced given that as of July 30, 2003, Biopure had made two substantial submissions

to the FDA requesting that it lift the clinical hold on the Trauma Clinical Trials, each of which

failed to adequately address the FDA’s safety concerns.

106. On or about the morning of July 31, 2003, Defendant Richman telephoned

an FDA staff member working on the Hemopure BLA and the INDA for the Trauma Clinical

Trials to discuss what steps Biopure should take following receipt of the Complete

Response Letter. That staff member identified the letter as in fact being a “complete

response letter” and told Defendant Richman that Biopure could, within 10 days of its

receipt, take one of four possible actions: (1) amend the Hemopure BLA, (2) notify the FDA

of its intent to amend the Hemopure BLA, (3) withdraw the Hemopure BLA, or (4) request

a hearing. Defendant Richman asked whether Biopure could take 30 days to respond to

the Complete Response letter, since it had been issued 30 days before its due date. The

FDA staff member responded by saying that the Complete Response Letter stopped the

review clock, no further FDA review would occur until Biopure responded to all 220

deficiencies outlined in the Complete Response Letter, that a partial response would not

be considered, and that once FDA received Biopure’s response to the Complete Response

Letter, the FDA would have a new review cycle of six months to review it.


44

107. On or about July 31, 2003, Biopure, through its General Counsel, contacted

outside legal counsel specializing in FDA regulatory matters to discuss the Complete

Response Letter and a press release Biopure intended to issue. The draft press release

stated that Biopure had received correspondence from the FDA, but did not identify it as

being a “complete response letter.” Outside counsel orally advised Biopure’s General

Counsel that he “didn’t have time to read letter but looked like complete response [sic],”

that the draft press release looked “unduly optimistic,” and that issuance of the Complete

Response Letter “30 days early in this context while true isn’t great cause optimism [sic].”

Biopure’s General Counsel informed Defendants Moore and Richman of the substance of

these comments by outside counsel.

Biopure Misleads the Public About the FDA’s Complete Response Letterand the July 30, 2003 Trauma Clinical Trials Letter

108. On August 1, 2003, Biopure issued a press release (the “August 1, 2003

Press Release”) in which it disclosed that the FDA was seeking additional information in

connection with the Hemopure BLA and that the FDA had suspended its review clock on

the Hemopure BLA. Defendants Moore and Richman substantially participated in the

drafting, review and/or approval of the August 1, 2003 Press Release.

109. Specifically, the August 1 Press Release said:

CAMBRIDGE, Mass., Aug. 1, 2003 /PRNewswire-FirstCall viaCOMTEX/ – Biopure Corporation (BPUR) announced todaythat the U.S. Food and Drug Administration (FDA) hascompleted its review of the company’s biologic licenseapplication (BLA) for Hemopure® [hemoglobin Glutamer - 250(bovine)] and issued a letter requesting additional information.The letter focuses primarily on clarification of clinical andpreclinical data and includes some comments on labeling. Itdoes not request additional clinical trials. Biopure has appliedto market Hemopure in the United States for the treatment ofacutely anemic adult patients undergoing orthopedic surgery


45

and for the elimination or reduction of red blood celltransfusions in these patients.

With 30 days remaining in the original BLA review cycle, theissuance of the letter has suspended the FDA review clockuntil Biopure submits a complete response.

“We’re encouraged that the FDA has finished its review andprovided comprehensive feedback in advance of the formalaction due date. By maintaining thirty days on the reviewclock, the FDA is encouraging us to work with them tocomplete the approval process as quickly as possible,” saidBiopure President and CEO Thomas A. Moore. “We’ll workwith the Agency to address the remaining questions and willprovide our answers as expeditiously as possible.”

110. The August 1, 2003 Press Release was false, deceptive and misleading to

investors in its portrayal of the information that Biopure had received from the FDA. First,

the August 1, 2003 Press Release failed to disclose altogether Biopure’s receipt of the

Complete Response Letter from the FDA. Second, its tone was deceptively and

inaccurately optimistic, notwithstanding the fact that Biopure had just received two detailed

letters from the FDA that together constituted a tremendous, if not insurmountable, setback

in the Company’s efforts at ever gaining FDA approval of Hemopure. Defendant Moore’s

statement that the FDA’s letter was “encouraging” Biopure to “complete the approval

process as quickly as possible” was misleading insofar as it had no basis in fact and was

inconsistent both with the gravity and number (220) of deficiencies outlined in the Complete

Response Letter and with the time it would take the Company to respond. Third, the

August 1, 2003 Press Release’s reference to the 30 days remaining in the review cycle was

misleading, because the FDA had a six-month time frame within which to respond, if and

when the Company actually responded to all of the deficiencies outlined in the Complete

Response Letter. Fourth, the August 1, 2003 Press Release was misleading by stating that


46

FDA had not requested additional clinical trials when in actuality FDA had questioned the

integrity of the Company’s submitted data (a preliminary step in determining whether new

clinical trials were necessary) and implemented a clinical hold, which it refused to lift,

barring the Trauma Clinical Trials from occurring. In fact, the August 1, 2003 Press

Release failed to disclose any information about the clinical hold, including that it had been

implemented; that the Company had twice tried and twice failed to persuade FDA to lift it;

and that the FDA, on July 30, 2003, had sent the detailed July 30, 2003 Clinical Trials

Letter refusing (again) to lift it and identifying many of the same deficiencies, concerns, and

questions outlined in the Complete Response Letter.

111. The text of the August 1, 2003 Press Release was included in a Form 8-K that

Biopure filed with the SEC (the “August 1, 2003 Form 8-K”), which was therefore false and

misleading for the same reasons. The August 1, 2003 Press Release, by itself and through

its inclusion within the August 1, 2003 Form 8-K, artificially inflated the price of Biopure’s

common stock.

112. The August 1, 2003 Press Release was issued on the morning of August 1,

2003. The marketplace, not knowing of its false and misleading nature, strongly and

positively responded to the August 1, 2003 Press Release. On August 1, 2003, the price

of Biopure common stock closed at $7.30 per share, up $1.33 per share, or 22.27%, over

its close at $5.97 per share on July 31, 2003. Biopure’s stock traded as high as $9.03 per

share on August 1, 2003, on volume of almost 7 million shares.

113. On or about August 5, 2003 Biopure’s General Counsel sent an e-mail

message to outside counsel specializing in FDA regulatory matters requesting help in

formulating a strategy for responding to the Complete Response Letter. In a reply e-mail


47

sent the same day, the Company’s outside counsel identified the July 30, 2003 letter as

being a “complete response letter.”

114. Thereafter, the price of Biopure stock continued to rise, closing on August 20,

2003 at $8.12 per share.

Biopure Continues to Misrepresent the Complete Response Letter and to Conceal the Existence of the Clinical Hold on the Trauma Clinical Trials

115. On August 31, 2003, Biopure issued a press release announcing its Q3

financial results for fiscal year 2003 (“August 21, 2003 Press Release”). Defendants Moore

and Richman participated in the drafting, review, and/or approval of the August 21, 2003

Press Release.

116. The August 21, 2003 Press Release included the following statements

concerning the FDA’s review of Biopure’s Hemopure BLA:

On July 30th, the FDA sent Biopure a letter stating that theagency has completed its review of the company’s BLA tomarket Hemopure in the United States for the treatment ofacutely anemic adult patients undergoing orthopedic surgeryand for the elimination or reduction of red blood celltransfusions in these patients. The letter requests additionalinformation and suspends the BLA review clock with 30 daysremaining in the original review cycle. It does not requestadditional clinical trials. Biopure is preparing its response,which, when submitted, will restart the review clock. “We’vedeveloped many of our initial responses and so far we feel wewill be prepared to answer FDA’s questions,” said Moore. “Wehave an opportunity to answer all of the Agency’s remainingquestions before it acts on our application, so we want to besure we’re fully meeting the FDA’s needs. Therefore, we arerequesting a meeting with the FDA in September. The Agencyis allowing Biopure to set the agenda for this meeting, whichwill enable us to request any clarifications we need to completeour responses. The timing for when we’ll submit our completeresponse to the FDA will be driven by the guidance we receiveduring this meeting.”


48

117. The August 21, 2003 Press Release was false and misleading to investors

about the true information that Biopure had received from the FDA. First, it failed to

disclose that the Company had received a Complete Response Letter from the FDA.

Second, its references to 30 days remaining in the review cycle were misleading about the

true six-month time frame within which the FDA could respond to Biopure, if and when the

Company first responded to all 220 deficiencies outlined in the Complete Response Letter.

Third, the August 21, 2003 Press Release was misleading by stating that the FDA had not

requested additional clinical trials, when in actuality the FDA was questioning the integrity

of the Company’s clinical data previously submitted in support of the Hemopure BLA (a

preliminary step to determining whether additional clinical trials were necessary) and was

refusing to lift the clinical hold barring conduct of the Trauma Clinical Trials. Fourth, the

August 21, 2003 Press Release failed to disclose any information whatsoever about the

clinical hold, including that it had been implemented; that the Company had twice tried and

twice failed to persuade FDA to lift it; and that the FDA on July 30, 2003 had sent the

detailed July 30, 2003 Clinical Trials Letter refusing (again) to lift it and identifying many of

the same deficiencies, concerns, and questions outlined in the Complete Response Letter.

118. The text of the August 21, 2003 Press Release was included in a Form 8-K

that was dated September 15, 2003 and filed with the SEC (“September 15, 2003 Form 8-

K”). By including without amendment the text of the August 21, 2003 Press Release, the

September 15, 2003 Form 8-K was false and misleading for the same reasons as

articulated above.


49

119. Also on August 21, 2003, the Defendants Biopure, Moore, Richards, and

Richman participated in a telephonic conference call for analysts and institutional investors

(the “August 21, 2003 Investor Call”). Like the May 22, 2003 Investor Call, analysts and

institutional investors could participate in the August 21, 2003 Investor Call and all

members of the investing public could hear the call live and access it thereafter for a period

of time. A copy of the transcript of that conference call, prepared by CCBN StreetEvents,

for Biopure, is attached hereto as Exhibit E and incorporated herein by reference.

120. During the August 21, 2003 Investor Call, Defendants made statements and

answered questions from public participants, about Biopure, the Hemopure BLA and the

Trauma Clinical Trials, which were false, deceptive and misleading. For example,

Defendants made the following statements:

Thomas A. Moore – Biopure - CEO

The agency has done us a big favor by providing whatamounts to a complete detailed response and set of questionsto Biopure prior to the end of the review cycle, and thenstopping the review clock with 30 days remaining in the PDUFAcycle. They have thereby made a commitment to give us anaction letter 30 days after we provide our response to theirquestions. They could just as easily have announced an endto the review cycle with their response, in which case theywould have had two to six months to respond to our answersinstead of the 30 day period.

* * *

Our efforts to date suggest that we’re in good shape so far tobe able to answer FDA’s questions.

* * *Jason Colbert - Susquehanna Capital - Analyst

. . . A couple of questions on the letter from the FDA. Youused the term complete response a couple of times. But, thisisn’t a complete response letter. What is it exactly?


50


It’s, and I’ll ask Howard Richman to comment on this in just asecond. It is – I think Howard will call it a hybrid, and by that Imean it genuinely represents all the questions that FDA wouldlike to have us answer, and so in that sense it’s like a completeresponse. But normally a complete response letter brings anend to the review cycle. And the agency has elected not to dothat, offering us this precious opportunity to get a response 30days after we submit the answers to those questions. And so,that’s what it is.

Jason Colbert - Susquehanna Capital - Analyst

It sounds like the response is going to take some time. Canyou tell me about how many questions are involved? And thefollowup question is, depending on the length of your response,is it reasonable to expect that the FDA is going to be able torespond back within that 30 day timeline? If you give them avery exhaustive detailed response back, as I know you will,isn’t it going to take the FDA longer than 30 days to respondback?


I think that’s a very fair question, and that’s one of themotivations we have for having a meeting with FDA simply sowe can agree on how we’re going to order this data and maybehow we can share some of the data as we go so that it makesit easier for them to meet that guideline.


I’ll share this with yourself and for the other people listening.This type of letter is very unique. As Tom clearly stated foreveryone, it is a hybrid, it’s something that was done from the(indiscernible) perspective to work with Biopure in this aspectbecause you’re right in stating that people have (indiscernible),this does not follow the area that we’ve seen where you lookon FDA sites or in other complete responses. This was donewith the specific intent to work with us. With that being said, itcounts in such a way that they want us to be able to get backto them vis-a-vis this meeting and in our answers. Many of ouranswers will not be that detailed in response, some inclarification, which will only meet the FDA with some points


51

we’re going to discuss with them. Other ones will just providethem information they requested in terms of clarification andfollow-up source documents and other information they’veasked about. So when you say about a detailed (indiscernible)response, in many ways it will not be. But it’s also clear thatthe formation that they have for us with FDA which will beclarified on a meeting in September will clearly enlighten usand them and give a clear pathway to the response in a correcttime frame.

* * *


Just to repeat a question from earlier that I didn’t hear ananswer to which was the number of questions in the FDA letter.Can you tell us that?


We probably aren’t going to disclose that. I guess I shouldn’tsay probably. The number of questions isn’t going to do veryhelpful to people to understand what’s really in the letter. ...What I will say is there’s probably about 50 substantivequestions which we have - - which we’re working on which arereally the core of the efforts that we’re doing now. So, I thinkthe number 50 is more useful to bear in mind that the list... .

* * *

Alan Ferguson – 3i Technology Partners - Analyst

Is there anything on the work the trials that the military is doingin trauma yet?


We’ve not initiated human clinical trials in trauma with themilitary or for that matter on the civilian side as yet. So, wehope to get started on that ASAP. I think probably those trialswill begin, however, at least after we have – no sooner thanafter we filed our responses with FDA on the BLA questions.As I mentioned earlier in my flurry of discussions aboutmeetings, Naval medical research has been very active indoing preclinical work on trauma with our product, and thensharing those results in several different forms actually. So,


52

work is going on very actively on the trauma side, but I don’tbelieve human trials will begin until after we have completedour answers to the BLA. Part of this is related to the fact thatwe already are engaged in FDA in a dialogue on a total clinicaldevelopment program in trauma with FDA. And so we expectthe final discussion on that with FDA will ensue after we’veaddressed the questions they’ve asked for us on the use inanemia from surgery indications.

* * *

Richard Aussie - Nation Direct - Analyst

. . . My question is, what will you do if Biopure doesn’t get FDAapproval?


. . . While we are continuing to be cautiously optimistic, we’reon the approval track. If you ask us to specifically address thisquestion, which you have, I guess what I’d say is the FDAdoesn’t really just say no. At least not in a situation like thiswhere an application has been accepted and taken this fardown the review track. What the FDA says is here’s whatyou’ve got to do, guys, if you want to persuade us to say yes.And generally what they’d say is you need more information.I’m going to take a big leap here, Howard [Richman] may hitme. But if the information we’ve given them so far led them tosay we can’t approve it then they would’ve already said wecan’t approve it. Okay? You don’t go back and forth like thisbecause the product is not approvable. The question for theagency is the process of putting together the adequacy of thetotal data set.

(Exhibit E at 3, 5, 6, 10).

121. During the August 21, 2003 Investor Call, Defendants also made statements

specifically admitting that their prior statements about Biopure, the Hemopure BLA and the

Trauma Clinical Trials were being believed by the marketplace and were causing the price

of Biopure stock to increase. For example, the Defendant Moore made the following

statements during the August 21, 2003 Investor Call:


53

Thomas A. Moore - Biopure - CEO

In July we completed a public offering raising $17.2 million...Inconducting this raise, Chief Financial Officers Ron Richardsand I presented to 62 funds in person over a three-weekperiod. This is the most extensive presentation of the companyever, surpassing even the effort behind the IPO launch.Subsequent share price performance suggests we’rebeginning to establish an understanding of the excitingfuture potential for Hemopure as both a treatment for anemiaassociated with surgery, and an oxygen therapeutic for use intrauma, surgical ischemias and cancer therapy.

(Exhibit E at 2, emphasis added).

122. Biopure’s August 21, 2003 Investor Call was false and misleading to investors

about the true information the Company had received from the FDA. First, Defendants

misleadingly characterized the Complete Response Letter as a “hybrid” letter when in

actuality it was a complete response letter, a fact which had been confirmed by the FDA

to Defendant Richman at least twice previously. Second, Defendants falsely stated that

the FDA would have 30 days to review a submission from Biopure when in actuality it would

have six months to do so, if and when the Company first addressed all 220 deficiencies set

forth in the Complete Response Letter. Third, Defendant Moore’s statements that the FDA

had done Biopure a “big favor” and had “made a commitment to give us an action letter 30

days after we provide our response to their questions” had no basis in fact, were

inconsistent with the FDA’s prior communications to the Company, and contradicted the

six month period to which the FDA was actually entitled in reviewing any future

resubmission. Fourth, Defendants falsely stated that Biopure was “in good shape” to

address the deficiencies, questions, and concerns in the Complete Response Letter when

in actuality they were so numerous and substantial that the Company could not possibly

respond to them for years, if ever. In fact, Defendants refused to provide the actual number


54

of questions in the Complete Response Letter - - 220 in total - - and misleadingly

represented as being “substantive” the far lesser number of “50" questions. Fifth,

Defendants further misled investors by optimistically describing the likelihood of FDA

approval for Hemopure when in actuality there were major obstacles preventing such

approval, including the deficiencies, concerns, and questions set forth in both July 30, 2003

letters (including the Complete Response Letter); the clinical hold which FDA had twice

refused to lift, and concerns that FDA had discussed with the Company during telephone

calls. Finally, Defendants misleadingly discussed the Trauma Clinical Trials while failing

to disclose the FDA clinical hold.

123. On August 21, 2003, Biopure’s stock closed at $8.25 per share.

124. On or about August 22, 2003, Biopure filed a Form S-3 registration statement

and prospectus with the SEC for the sale of common stock and warrants for the purchase

of common stock by selling security holders (“August 2003 Offering Documents”).

Defendant Moore substantially participated in the drafting, review, and/or approval of the

August 2003 Offering Documents, which he signed, and Defendant Richman reviewed their

disclosures concerning the regulatory status of Biopure’s FDA submissions.

125. In the August 2003 Offering Documents, Biopure did not state that the letter

it had received on July 30, 2003 was a “complete response letter.” Additionally, the

Company made, inter alia, the following statement:


The FDA requires a separate approval for each proposedindication for the use of Hemopure in the United States. Wehave applied for an indication for Hemopure that will onlyinvolve its perioperative use in patients undergoing orthopedicsurgery. Subsequently, we expect to expand Hemopure’s


55

indications. To do so, we will have to design additional clinicaltrials, submit the trial designs to the FDA for review andcomplete those trials successfully. ...

126. Biopure’s August 2003 Offering Documents were false and misleading to

investors about the true information the Company had received from the FDA. First, the

August 2003 Offering Documents failed to disclose, among other things, that the July 30,

2003 letter the Company received from the FDA was a “complete response letter.”

Second, the August 2003 Offering Documents failed to disclose the clinical hold on the

Trauma Clinical Trials, that the hold was put in place due to safety concerns, and that the

FDA had twice refused to lift the hold. Third, the August 2003 Offering Documents misled

investors by falsely stating that the indication for Hemopure’s perioperative use in

orthopedic surgery patients was the “only” indication applied for when in actuality the

Company had also sought permission to conduct the Trauma Clinical Trials. Finally, the

August 2003 Offering Documents disclosed a future “expectation” to expand Hemopure’s

indications, design additional trials, and submit those trials for FDA review when, in truth,

the Company had already designed additional clinical trials (the Trauma Clinical Trials),

submitted their designs to the FDA for review, and received a clinical hold imposed by the

FDA.

Biopure’s Outside Counsel Confirms the Nature of the Complete Response Letter and that a Six Month Period

Would Apply to Any Resubmission by the Company

127. On or about August 26, 2003, at the request of Biopure management, the

Company’s outside counsel contacted FDA staff members to determine whether the FDA

planned to issue a second response letter by August 29, 2003. After that conversation,

Biopure’s outside counsel informed the Company’s General Counsel, as well as


56

Defendants Moore and Richman, in discussions and via e-mails, that despite the use of

some non-standard language and the issuance of the letter 30 days prior to the due date,

the letter that Biopure received on July 30, 2003 regarding the Hemopure BLA (the

Complete Response Letter) was in fact a “complete response letter” for the Hemopure BLA.

Biopure’s outside counsel further confirmed to the Company’s General Counsel, Defendant

Moore, and Defendant Richman that the review cycle had been completed without any

approval of Hemopure by the FDA and that the FDA would have six months to review any

resubmission by Biopure.

Biopure Continues to Misrepresent the Complete Response Letter, to Withhold Information on the True Status of the Hemopure BLA, and to Conceal the Clinical Hold on the Trauma Clinical Trials In

Public Statements and Periodic Reports Filed with the SEC,While Selling Biopure Stock

128. On September 12, 2003, Biopure filed with the SEC a Form 424(b)(3)

prospectus (the “September 12, 2003 Prospectus”). In the “Risk Factors” section of the

September 2003 Prospectus, the Company stated that the letter it received from the FDA

on July 30, 2003 was a “complete response letter.” On the next trading day, September

15, 2003, the Company’s stock dropped by 6.5% on heavy trading. When asked about this

trading activity, Biopure’s Director of Corporate Communications attributed the stock

movement that day to the disclosure that the Company had received a “complete response

letter.” In e-mail messages sent to investors, he stated that the reference to the FDA’s July

30, 2003 correspondence as a “complete response letter” had been a “mistake” by a “junior

lawyer at a law firm” used by the Company.

129. On September 15, 2003 (the next trading day following the filing of the

September 12, 2003 Prospectus), Biopure filed with the SEC an amended Form 424(b)(3)


57

prospectus (“September 15, 2003 Prospectus”). The September 15, 2003 Prospectus

omitted the reference to the FDA’s July 30, 2003 correspondence being a “complete

response letter.” Defendant Moore substantially participated in the drafting, review, and/or

approval of the September 15, 2003 Prospectus. Defendant Richman reviewed the

disclosures contained therein concerning the regulatory status of Biopure’s FDA

submissions.

130. On or about September 15, 2003, Biopure filed with the SEC a Form 10-Q

for the quarter ended July 31, 2003 (“July 2003 10-Q”). Defendant Moore substantially

participated in the drafting, review, and/or approval of the July 2003 10-Q, which he signed

and with respect to which he certified that the document did not “contain any untrue

statement of a material fact or omit to state a material fact necessary to make the

statements made, in light of the circumstances under which such statements were made,

not misleading.” Defendant Richman reviewed the non-financial reporting sections of the

July 2003 10-Q.

131. In the July 2003 10-Q, Biopure did not disclose the nature of the Complete

Response Letter. In addition, the Company made the following statement:


The FDA requires a separate approval for eachproposed indication for the use of Hemopure in the UnitedStates. We have applied for an indication for Hemopure thatwill only involve its periopoerative use in patients undergoingorthopedic surgery. Subsequently, we expect to expandHemopure’s indications. To do so, we will have to designadditional clinical trials, submit the trial designs to FDA forreview and complete those trials successfully....

* * *


58

We also plan to develop Hemopure for potential use in traumaand other medical applications.

132. Biopure’s July 2003 10-Q was false and misleading to investors in several

ways about the true information that the Company had received from the FDA. First, the

July 2003 10-Q failed to disclose, inter alia, that the FDA correspondence received by the

Company on July 30, 2003 was in fact a “complete response letter” and that the FDA had

instituted a clinical hold barring the Company from conducting the Trauma Clinical Trials.

Second, the July 2003 10-Q falsely stated that an indication for Hemopure’s perioperative

use in orthopedic surgery patients was the “only” indication applied for when in actuality the

Company had also sought permission to conduct the Trauma Clinical Trials. Third, the July

2003 10-Q disclosed a future “expectation” to expand Hemopure’s indications, design

additional trials, and submit those trials for FDA review when, in truth, the Company had

already designed additional clinical trials (the Trauma Clinical Trials), submitted their

designs to the FDA for review, and received a clinical hold imposed by the FDA.

133. On September 10, 2003 Biopure issued a press release announcing that the

Defendant Moore would be making a presentation at the ThinkEquity Partners Growth

Conference on September 17, 2003. As reflected in the press release, Defendant Moore’s

statements at that conference were made available to the investing public. The press

release, in relevant part, stated as follows:

...Biopure Corporation (BPUR) today announced that companyPresident and CEO Thomas A. Moore will present at theThinkEquity Partners Growth Conference on Wednesday,September 17, 2003, at 9:30 p.m. PT. The investor conferenceis being held at The OMNI San Francisco from September 16-17, 2003. A live webcast of the 25-minute presentation will beavailable online via the Investor Relations section of Biopure’sweb site at www.biopure.com...An archive of the webcast willbe available for at least 4 days following the event.


59

134. On September 17, 2003, the Defendant Moore, gave a presentation about

Biopure, Hemopure, and the Hemopure BLA at the ThinkEquity Partners Growth

Conference at the Omni Hotel in San Francisco, California. That conference was attended

by securities analysts, investment advisors and other members of the investing public.

Attached hereto as Exhibit F is a transcript of Defendant Moore’s statements at that

conference, which are incorporated herein by reference. This transcript was transcribed

by Plaintiffs’ counsel’s personnel, from an audio tape of the Defendant Moore’s

presentation, which audio tape is in the possession of Plaintiffs’ counsel.

135. As reflected in Exhibit F hereto, at the ThinkEquity Growth Partners

Conference, the Defendant Moore said:

...From a safety standpoint, our agreement with FDA was thatthe primary safety endpoint would be based on a peak analysiswhich was a separate analysis of the data done by anindependent and blinded medical panel. That panel concludedthat our product was not inferior to red blood cells in respect tooverall medical risk. This is not the only way the agency looksat safety but it is the primary safety endpoint.

(Exhibit F at 8).

136. That statement was false, deceptive and misleading in light of the FDA’s

safety concerns, the clinical hold barring the conduct of the Trauma Clinical Trials, and the

Complete Response Letter, all of which Biopure and Defendant Moore failed to disclose

to Conference attendees.

137. As reflected in Exhibit F hereto, at the ThinkEquity Growth Partners

Conference, the Defendant Moore described in detail the history of Biopure, the status of

the Hemopure BLA, the anticipated uses for and market for Hemopure, and the economics

for Biopure of producing and selling Hemopure. Defendant Moore’s entire presentation at


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that conference was false, deceptive and misleading in light of the FDA’s safety concerns,

the clinical hold barring the conduct of the Trauma Clinical Trials, and the Complete

Response Letter, all of which Biopure and Moore failed to disclose at the Conference.

138. On September 18, 2003 Biopure issued a press release announcing that

Defendant Moore would be making a presentation at the UBS Global Life Sciences

Conference on September 25, 2003. As reflected in the press release, Defendant Moore’s

statements at that conference were made available to the investing public. The press

release, in relevant part, stated as follows:

...Biopure Corporation (BPUR) today announced that companyPresident and CEO Thomas A. Moore will present at the UBSGlobal Life Sciences Conference on Thursday, September 25,2003, at 12:30 p.m. EDT. The investor conference is beingheld at The Plaza in New York from September 22-25, 2003.A live webcast of the 25-minute presentation will be availableonline via the Investor Relations section of Biopure’s web siteat www.biopure.com...An archive of the webcast will beavailable for at least 4 days following the event.

139. On September 25, 2003, the Defendant Moore made a presentation before

the UBS Global Life Sciences Conference in New York, New York. That conference was

attended by securities analysts, investment advisors and other members of the investing

public. Attached hereto as Exhibit G is a transcript of Defendant Moore’s statements at that

conference. This transcript was transcribed by Plaintiffs’ counsel’s personnel, from an

audio tape of the Defendant Moore’s presentation, which audio tape is in the possession

of Plaintiffs’ counsel.

140. As reflected in Exhibit G hereto, at the UBS Global Life Sciences Conference,

the Defendant Moore said:

From a safety standpoint, in our pivotal trial, we agreed beforethe trial began with the FDA to use as our primary safety


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endpoint something called a [Seep?] study. Which is basicallya blinded analysis of all the case report forms by a panel ofdoctors who would examine each patient, create their ownscore of adverse events and then rank the product use againon a blinded basis in terms of how safe it was for the patient.After all the patients were rated by at least two blinded doctors,we broke the blind, and compared the accumulative scoresbetween our products and red blood cells and achieved asafety objective which was to confirm that our product was notinferior to red blood cells with respect to overall medical risks.

(Exhibit G at 8).

141. That statement was false, deceptive and misleading in light of the FDA’s

safety concerns, the clinical hold barring the conduct of the Trauma Clinical Trials, and the

Complete Response Letter, all of which Biopure and Moore failed to disclose to Conference

attendees.

142. As reflected in Exhibit G hereto, at the UBS Global Life Sciences Conference,

the Defendant Moore described in detail the history of Biopure, the status of the Hemopure

BLA, the anticipated uses for and market for Hemopure, and the economics for Biopure of

producing and selling Hemopure. Moore’s entire presentation at that conference was false,

deceptive and misleading in light of the FDA’s safety concerns, the clinical hold barring the

conduct of the Trauma Clinical Trials, and the Complete Response Letter, all of which

Biopure and Moore failed to disclose to Conference attendees.

Though Biopure Continued to Withhold the Truth about the Hemopure BLA, the FDA’s Safety Concerns about Hemopure, the Clinical Hold on the

Trauma Clinical Trials, and the Complete Response Letter, the Effects of the Company’s Fraud Begin Affecting Its Stock Price

143. On October 30, 2003, before the stock markets opened, Biopure issued a

press release (the “October 30, 2003 Press Release”), the text of which was included in a

Form 8-K filed with the SEC (“October 30, 2003 Form 8-K”). Defendant Moore substantially


62

participated in the drafting, review, and/or approval of the October 30, 2003 Press Release,

a copy of which is attached hereto as Exhibit H and incorporated herein by reference.

144. The October 30, 2003 Press Release - while still not disclosing to the

marketplace the truth about the status of the Hemopure BLA, the FDA’s safety concerns

about Hemopure, the clinical hold on the Trauma Clinical Trials, and the existence and

significance of the Complete Response Letter - disclosed some of their consequences,

particularly that the FDA would not be acting on the Hemopure BLA until sometime after

June 30, 2004. The October 30, 2003 Press Release also disclosed that the Defendant

Richman had left Biopure, though it falsely stated that he “...has left Biopure to pursue other

interests.” In actuality, he had been terminated.

145. The consequences of the still-undisclosed, adverse, material facts had

significant, negative financial implications for Biopure, some of which were disclosed in the

October 30, 2003 Press Release itself. Among other things, the October 30, 2003 Press

Release stated:

Biopure Corporation (Nasdaq: BPUR) today announced its planto respond by June 30, 2004 to the Food and DrugAdministration’s (FDA) questions regarding its biologic licenseapplication (BLA) for Hemopure ® [hemoblogin glutamer - 250(bovine)]. The company has adjusted its operating plan toreduce expenses and conserve cash while it completes itswritten response to the FDA.

Biopure applied for FDA approval to market the company’soxygen therapeutic, Hemopure, in the United States for thetreatment of acutely anemic adult patients undergoingorthopedic surgery and for the elimination or reduction of redblood cell transfusions in these patients.

During the past two months the company has had severalsubstantive interactions with the FDA to clarify the agency’squestions. Many of Biopure’s responses have beencompleted. However, some require the retrieval of source


63

medical documents and/or historical blood transfusion datafrom clinical trial sites in various countries, which will takeseveral months to complete.

146. In addition, the October 30, 2003 Press Release quotes the Defendant Moore

as follows:

“In the best interests of our shareholders, today we’ve takenthe steps necessary to more efficiently run our business whilewe complete our comprehensive response to all of the FDA’squestions,” said Biopure President and CEO Thomas A.Moore. “We view the agency’s questions as a ‘roadmap’ toapproval and have set a conservative, achievable target datefor our response. We remain enthusiastically committed tocommercializing Hemopure in the United States asexpeditiously as possible.”

147. The October 30, 2003 Press Release, and Moore’s above quoted statement

in the October 30, 2003 Press Release, were false, deceptive and misleading to investors

in numerous ways about the true status of Biopure’s continuing, but failing, efforts to gain

FDA approval for Hemopure. First, in the October 30, 2003 Press Release, the Defendants

continued to conceal from investors that the FDA correspondence which Biopure received

on July 30, 2003 was a “complete response letter.” Second, the October 30, 2003 Press

Release failed to disclose that the June 30, 2004 planned response date was dependent

upon the Company’s pursuing a much narrower indication than that described in the

original Hemopure BLA. In fact, prior to issuing the October 30, 2003 Press Release, the

Defendants ignored the advice of outside counsel, who, after reviewing a draft of the

release, recommended the inclusion of a disclosure that “[i]n its planned response to FDA,

Biopure intends to narrow its focus and seek approval only for anemia in those surgical

settings where blood transfusion is not an option.” Third, the October 30, 2003 Press

Release failed to disclose the FDA’s safety concerns, as well as the existence and


64

significance of the clinical hold imposed by FDA which barred conduct of the Trauma

Clinical Trials.

148. The October 30, 2003 Press Release also announced that Biopure would be

holding a conference call and webcast on October 30, 2003, at 11:30 am, at which

“...Moore will discuss the company’s regulatory and operating plans...”

149. On October 30, 2003, the Defendants Biopure, Moore and Richards

participated in a telephonic conference call for analysts and institutional investors (“October

30, 2003 Investor Call”). Like the May 22, 2003 Investor Call, analysts and institutional

investors could participate in the October 30, 2003 Investor Call, and all members of the

investing public could hear the call live and access it thereafter for a period of time. A copy

of the transcript of that conference call, prepared by CCBN StreetEvents, for Biopure, is

attached hereto as Exhibit I, and incorporated herein by reference.

150. During the October 30, 2003 Investor Call, the Defendants made statements

and provided answers to questions about Biopure, the Hemopure BLA, and the Trauma

Clinical Trials, which were false, deceptive and misleading because, inter alia, they omitted

and did not disclose the FDA’s safety concerns, the existence and significance of the

clinical hold on the Trauma Clinical Trials, and Biopure’s receipt of the Complete Response

Letter. For example, in the October 30, 2003 Investor Call, Defendant Moore was asked

about the use of Hemopure in South Africa and responded as follows:

Our stretch in South Africa has been very positive from thestandpoint that we have had good experience with the patientsand developed what we consider a very good safety recordwith the product.

(Exhibit I at 3, emphasis added).


65

151. As described above, the October 30, 2003 Press Release and the

Defendants’ statements in the October 30, 2003 Investor Call were false and misleading

insofar as, inter alia, they did not disclose the FDA’s safety concerns, the existence and

significance of the clinical hold on the Trauma Clinical Trials, and Biopure’s receipt of the

Complete Response Letter. However, as also described above, they did disclose

significant, material adverse consequences being caused by these things to Biopure and

the Hemopure BLA, such as Defendant Richman’s departure from the Company and the

fact that it would take eight additional months to respond to the FDA’s July 30, 2003

correspondence.

152. The market’s reaction to the negative - though incomplete - disclosures of the

consequences of the still-undisclosed, adverse material facts, in the October 30, 2003

Press Release, was immediate and dramatic. On October 29, 2003, the market price of

Biopure stock had closed at $6.05 per share, on trading volume of 250,000 shares. On

October 30, 2003, the market price of Biopure stock began trading at $5.00 per share; it

traded as low as $2.80 per share; and it closed at $3.68 per share on heavy trading volume

of 6,910,000 shares. Hence, the market price of Biopure stock experienced a single-day

drop of over 39% on October 30, 2003, in reaction to the October 30, 2003 Press Release.

153. The extremely negative reaction to the disclosures in the October 30, 2003

Press Release is also demonstrated in the October 30, 2003 article in TheStreet.com,

attached hereto as Exhibit J.

154. The price of Biopure stock continued to decline after October 30, 2003. On

October 31, 2003, Biopure stock closed at $3.46 per share; and on the next trading day,

November 3, 2003, Biopure stock closed at $3.20 per share. Hence, in the three trading


66

days after the October 30, 2003 Press Release, the market price of Biopure declined over

47%, from its close at $6.05 per share on October 29 to its close at $3.20 per share on

November 3, 2003. Thereafter, the price of Biopure stock continued to decline. On

December 24, 2003, prior to the issuance of a December 24, 2003 press release (which

was issued after the close of the stock market on December 24, 2003) that is described

below, Biopure’s stock closed at $2.82 per share. December 24, 2003 is the end of the

Class Period.

155. The drop in the price of Biopure’s stock which occurred on October 30, 2003,

and which continued in the days and weeks following, was caused by the effects of the

Defendants’ undisclosed fraud taking root in the marketplace. Although Defendants still

had not disclosed the truth about Biopure, Hemopure, the Hemopure BLA, the FDA’s safety

concerns about Hemopure, the clinical hold on the Trauma Clinical Trials, and Biopure’s

receipt of the Complete Response letter, some of the consequences of these undisclosed

circumstances were made known to the market beginning on October 30, 2003. For

example, Defendants publicly stated on October 30, 2003 that Defendant Richman had left

the company; that the FDA would not take action on the Hemopure BLA until June 20,

3004; and that the Company had “adjusted its operating plan to reduce expenses and

conserve cash” as worked on responses to the FDA.

Biopure Finally Discloses Publicly, For the First Time,the FDA’s Safety Concerns, the Clinical Hold on the Trauma

Clinical Trials, the Complete Response Letter, the True Status of the Hemopure BLA, and the Ongoing SEC Investigation

156. On or about December 11, 2003, Biopure issued a press release announcing

its financial results for the fiscal year ending October 31, 2003 (“December 11, 2003 Press

Release”), the text of which was included in a Form 8-K filed with the SEC (“December 11,


67

2003 Form 8-K”). Defendant Moore substantially participated in the drafting, review, and/or

approval of the December 11, 2003 Press Release. In the December 11, 2003 Press

Release, Biopure disclosed for the first time that the correspondence it had received from

the FDA on July 30, 2003 (over four months prior) was a “complete response letter.” The

December 11, 2003 Press Release, however, did not disclose the clinical hold on the

Trauma Clinical Trials.

157. The market reacted swiftly to the negative - though still incomplete -

disclosures in the December 11, 2003 Press Release and December 11, 2003 Form 10-K.

On December 11, 2003, the market price of Biopure stock had closed at $2.89 per share,

on trading volume of 68,600 shares. On December 12, 2003 (the next trading day following

the December 11, 2003 Press Release and the December 11, 2003 Form 8-K), the market

price of Biopure stock began trading at $2.52 per share; it traded as low as $2.50 per share

before closing at $2.60 per share on heavy trading volume of 218,600 shares. Hence, the

market price of Biopure stock experienced a single-day drop of about 10% on December

12, 2003, in reaction to the December 11, 2003 Press Release and the December 11,

2003.

158. The next trading day, December 15, 2003, began a steady week of additional

declines in Biopure’s closing stock price, from $2.64 (on December 15, 2003) to $2.51 (on

December 16, 2003) to $2.49 (on December 17, 2003) to $2.36 (on December 18, 2003)

to $2.34 (on December 19, 2003). Thus, just one week after the December 11, 2003 Press

Release and December 11, 2003 Form 8-K, Biopure’s stock was down just over 19%.

159. The drop in the price of Biopure’s stock which occurred on December 12,

2003, and which continued in the days following, was caused by the disclosures in the


68

December 11, 2003 Press Release and the effects of the Defendants’ still-undisclosed

fraud taking root in the marketplace. Although Defendants had finally disclosed that the

correspondence the Company received from the FDA on July 30, 2003 was a “complete

response letter,” they still had not disclosed the complete truth about Biopure, Hemopure,

the Hemopure BLA, the FDA’s safety concerns about Hemopure, and the clinical hold on

the Trauma Clinical Trials.

160. On December 24, 2003, after the close of the stock markets, Biopure issued

a press release (the “December 24, 2003 Press Release”), the text of which was included

in a Form 8-K filed with the SEC (“December 24, 2003 Form 8-K”) and a copy of which is

attached hereto as Exhibit K and incorporated herein by reference.

161. In the December 24, 2003 Press Release Biopure publicly revealed, for the

first time ever, the existence of the FDA’s clinical hold on the Trauma Clinical Trials, which

had been imposed over eight months before. Biopure also disclosed that the Defendants

Biopure, Moore and Richman had each received a “Wells Notice” from the SEC, advising

that the SEC staff had made a preliminary determination to recommend the filing of a civil

enforcement staff action against them.

162. In particular, the December 24, 2003 Press Release stated, in part, as

follows:

CAMBRIDGE, Mass., Dec 24, 2003 ... Biopure Corporation(BLUR) reported that on December 22, 2003, it received a“Wells Notice” from the staff of the Securities and ExchangeCommission (SEC) indicating the staff’s preliminary decision torecommend that the SEC bring a civil injunctive proceedingagainst the company.... The company’s chief executive officer[the Defendant Moore] and its former senior vice president ofRegulatory and Operations [the Defendant Richman] alsoreceived Wells Notices.


69

... the notices relate to the company’s disclosures concerningits communications with the Food and Drug Administration(FDA) about a trauma study protocol the company submittedto the Agency in March 2003 and about the company’sbiologics license application (BLA) for Hemopure ®[hemoglobin glutamer - 250 (bovine)]....

Biopure submitted the trauma protocol for a Phase II clinicaltrial of Hemopure for the treatment of hemorrhagic shockcasualties in the hospital setting, where red blood celltransfusions are available....

After the in-hospital trauma protocol was submitted to theFDA...the Agency placed a clinical hold on the proposedtrauma trial due to safety concerns. The FDA referred toa review of adverse event data from the company’s PhaseIII orthopedic surgery trial, which was submitted in theBLA....(emphasis added)

In May 2003, Biopure responded to the FDA’s clinical hold andalso filed the response as a BLA amendment because itdiscussed data previously submitted with the BLA. Thatamendment resulted in the FDA extending its BLA reviewperiod up to 90 days, as previously announced on May 30,2003.... After the company’s responses, the FDA has twicedeclined to lift the clinical hold, most recently in a letter datedJuly 30, 2003. This letter is separate from the FDA completeresponse letter Biopure received on that date in response to itsBLA for orthopedic surgery. The questions in the FDA’strauma letter were the same as some of the questions in theBLA complete response letter....

(emphasis added)

163. The December 24, 2003 Press Release informed the investing public, for the

first time, about the FDA’s safety concerns regarding Hemopure as a result of adverse

event data from Biopure’s Phase III clinical trial for its Hemopure BLA; the fact that, in light

of those safety concerns, the FDA had placed a clinical hold on the Trauma Clinical Trials,

which had first been communicated to the Defendants by the FDA on April 9, 2003; the

serious impact those safety concerns had and were continuing to have on the prospects


70

of the Hemopure BLA being approved by the FDA; and the delays those safety concerns

would cause in the FDA’s decision regarding the Hemopure BLA.

164. The December 24, 2003 Press Release informed the investing public, for the

first time, that due to the FDA’s safety concerns regarding Hemopure as a result of adverse

event data from Biopure’s Phase III clinical trial for its Hemopure BLA, the FDA had, on

April 9, 2003, placed a clinical hold on the Trauma Clinical Trials.

165. The December 24, 2003 Press Release also informed the investing public,

for the first time, that the Defendants’ public statements during the Class Period regarding

Biopure, the Hemopure BLA, and the Trauma Clinical Trials had been false, deceptive and

misleading; that the SEC was investigating those false and deceptive statements and that

the SEC staff had decided to recommend that the SEC bring an enforcement action against

the Defendants Biopure, Moore and Richman.

166. These first-time disclosures had a significant negative effect on the

Company’s stock price. On the very next trading day, Friday, December 26, 2003,

Biopure’s stock closed down 13.83% at $2.43. On Monday, December 29, 2003, Biopure’s

stock closed down again at $2.33, which represented a 17.38% decrease from the closing

price on December 24, 2003.

167. The drop in Biopure’s stock price from December 11, 2003 to December 24,

2003 and then from December 26, 2003 to December 29, 2003 was caused by the partial

disclosures of the fraud alleged herein on December 11, 2003 and December 24, 2003.

The price drops in Biopure’s stock from October 30, 2003 to December 10, 2003, were

caused by the market’s reaction to the effects on the Company of the then-still-undisclosed

fraud.


71

168. On January 29, 2004, Biopure filed its Annual Report for its fiscal year ended

October 31, 2003 with the SEC on Form 10-K/A (hereinafter the “2003 10-K”). The 2003

10-K was signed by all of the Individual Defendants except Richman. In the 2003 10-K, the

Defendants disclosed some additional adverse material information concerning the SEC’s

investigation and Biopure’s communications with the FDA during the Class Period.

Specifically, the Defendants disclosed the following in the 2003 10-K:

13. Litigation and Subsequent Events

SEC Investigation. During the fourth quarter of fiscal2003, the Company was notified of a confidential investigationby the Securities and Exchange Commission (SEC). OnDecember 22, 2003, the Company, its Chief Executive Officerand its former Senior Vice President, Regulatory andOperations received “Wells Notices” from the staff of the SECstating the staff’s preliminary determination to recommend thatthe SEC bring a civil injunctive proceeding against theCompany and the individuals. Biopure and the individualsresponded in writing to the notices on January 9, 2004. Thestaff is continuing to gather information.

Biopure believes the notices relate to Companydisclosures concerning communications with the FDA about aclinical hold imposed on a clinical study protocol the Companysubmitted to the agency in March 2003 and the status of theCompany’s BLA. In March 2003, the Company filed aproposed protocol for a Phase II clinical trial in trauma patientsin a hospital setting. The FDA put the protocol and its relatedinvestigational new drug application (IND) on “clinical hold,”meaning the trial could not begin as proposed. The FDA citedsafety concerns based on a preliminary review of data from theCompany’s trial in patients undergoing orthopedic surgery.After the Company responded in two written submissions, theclinical hold was reasserted twice in writing, most recently onJuly 30, 2003. The Company did not disclose the clinical holdbecause the Company did not consider correspondence withthe agency about data interpretation in the development of aprotocol to be material, notwithstanding the references to datain the BLA. The staff’s investigation also concerns theCompany’s disclosures concerning the FDA’s review of theBLA, after receipt of the complete response letter dated July


72

30, 2003. The Company has been cooperating throughout theinvestigation with the SEC staff. At this time, the Companycannot estimate what impact, if any, this inquiry may have onits financial position or results of operations.

169. On April 30, 2004, Biopure issued a press release (“April 30, 2004 Press

Release”) in which it disclosed that on April 29, 2004, the SEC staff had issued four

additional Wells Notices, indicating that the SEC staff was considering recommending that

the SEC also bring civil actions against the Defendants Sanders, Crout and Rausch, and

Biopure General Counsel, Jane Kober, for violations of the federal securities laws. The

April 30, 2004 Press Release read, in part, as follows:

CAMBRIDGE, Mass., Apr 30, 2004...Biopure Corporation(BPUR) reported today that on April 29, 2004, the U.S.Securities and Exchange Commission (SEC) issued additional“Wells Notices” to four individuals concerning matters disclosedin Biopure’s press release dated December 24, 2003. Thenotices indicate that the SEC staff may recommend that theCommission bring a civil action against Biopure’s non-executive Chairman Dr. Charles A. Sanders, former BoardMember Dr. J. Richard Crout, Chief Technology Officer andBoard Member Carl W. Rausch, and General Counsel JaneKober for possible violations of federal securities laws. Thenotices afford the individuals an opportunity to respond inwriting before the SEC staff formally decides what action, ifany, to recommend.

Biopure will continue to cooperate with the SEC staff in thematters investigated. As previously disclosed, Biopurebelieves that the SEC investigation relates to the company’sdisclosures concerning its communications with the U.S. Foodand Drug Administration (FDA) about a proposed trauma studyprotocol the company submitted to the FDA in March 2003 andabout the company’s biologics license application (BLA) forHemopure®...

The Defendants Biopure and Rausch Sold Millions of Dollars of Biopure Stock During the Class Period, While In Possession of Material, Adverse, Non-Public Information Regarding Biopure


73

170. While Defendants engaged in the fraudulent and unlawful conduct described

herein, and while in possession of material, adverse, nonpublic information regarding the

Company described herein, Defendants Biopure and Rausch made millions of dollars

through transactions involving Biopure stock during the Class Period.

171. On or about April 16, 2003, while in possession of the nonpublic material

adverse information regarding the Company, Biopure realized $3,032,000 in net proceeds

from the sale of shares and warrants.

172. On May 2, 2003, while in possession of the nonpublic material adverse

information regarding the Company, Biopure sold 882,353 shares of Biopure common

stock for $3.57 per share, for a total of $3,150,000. Those shares were registered with the

SEC under a shelf registration.

173. On May 6, 2003, while in possession of the nonpublic material adverse

information regarding the Company, Biopure sold 833,334 shares of Biopure common

stock for $3.60 per share, for a total of $3,000,000. Those shares were registered with the

SEC under a shelf registration.

174. In May and June 2003, while in possession of the nonpublic material adverse

information regarding the Company, Biopure sold 707,060 shares of Biopure common stock

at an average price of $5.56 per share, for a total of $3,839,000. Those shares were

registered with the SEC under a shelf registration.

175. On or about July 23, 2003, while in possession of the nonpublic material

adverse information regarding the Company, Biopure sold 3,083,000 shares of Biopure

common stock for $5.58 per share, for a total of $17,203,140. Those shares were

registered with the SEC under a shelf registration.


74

176. Between August 1, 2003 and September 15, 2003, while in possession of

the nonpublic material adverse information regarding the Company, Biopure sold 802,188

shares of Biopure common stock at an average price of $7.55 per share, for a total of

$6,003,000.

177. In September 2003, while in possession of the nonpublic material adverse

information regarding the Company, Biopure sold 522,193 shares of Biopure common stock

at a price of $4.84 per share, for a total of $2,527,000.

178. Throughout the Class Period, Biopure had sales of up to $10,000,000 of

common stock issued from time to time by the standby equity distribution agreement with

CMI.

179. During the fiscal year ended October 31, 2003, approximately eight months

of which falls within the Class Period, warrants to purchase 712,141 shares of Biopure’s

common stock were exercised at an average exercise price of $4.52 per share, generating

$3,200,000 in net proceeds in the process.

180. During the Class Period, while in possession of the non-public material

adverse information regarding the Company, the Defendant Rausch sold a total of 276,574

shares of Biopure, for approximately $1,596,000. Those shares constituted 33.7% of the

Biopure shares owned by Rausch at the beginning of the Class Period. Specifically,

Rausch sold the following numbers of Biopure shares on the following dates:

DATE BIOPURESHARES SOLD

BY RAUSCH

NUMBER OFSHARES SOLD

BY RAUSCH

PRICE PERSHARE

TOTAL RECEIVEDBY RAUSCH

4/15/03 30,000 $3.13 $93,900

6/5/03 2,000 $6.06 - $6.07 $12,000


DATE BIOPURESHARES SOLD

BY RAUSCH

NUMBER OFSHARES SOLD

BY RAUSCH

PRICE PERSHARE

TOTAL RECEIVEDBY RAUSCH

75

6/24/03 3,000 $5.58 - $5.698 $17,000

6/25/03 2,700 $5.80 - $5.97 $16,000

6/26/03 34,374 $5.80 - $5.90 $201,000

6/27/03 20,000 $5.95 - $6.00 $120,000

6/30/03 5,000 $6.14 - $6.16 $31,000

8/5/03 10,000 $7.50 - $7.53 $75,000

8/6/03 2,000 $7.50 - $7.54 $15,000

8/7/03 8,000 $7.00 $56,000

8/8/03 10,000 $7.05 - $7.28 $72,000

8/12/03 10,000 $7.00 - $7.15 $71,000

8/13/03 9,500 $7.02 - $7.15 $67,000

8/28/03 100,000 $7.50 $750,000

TOTALS 246,574 $1,596,900


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Plaintiffs’ Purchases of Biopure Stock During the Class Period

181. Plaintiff Erickson purchased a total of 75,000 shares of Biopure common

stock during the Class Period, on the following dates:

DATE BIOPURE SHARES PURCHASED NUMBER OF SHARES PURCHASED

05/16/03 11,600

05/16/03 500

05/16/03 300

05/16/03 2,500

05/16/03 100

05/16/03 100

05/16/03 1,000

05/16/03 5,000

05/16/03 100

05/16/03 200

05/16/03 2,700

05/16/03 100

05/16/03 800

05/29/03 5,000

05/29/03 5,000

05/29/03 5,000

05/29/03 10,000

05/29/03 10,000

05/29/03 10,000

05/30/03 5,000

TOTAL 75,000

182. Plaintiff Gottlieb purchased the following number of shares of Biopure

common stock on the following dates:


77

DATE BIOPURE SHARES PURCHASED NUMBER OF SHARES PURCHASED

4/17/03 3,000

4/29/03 2,500

5/19/03 2,000

5/20/03 1,400

6/23/03 1,000

8/22/03 3,000

8/25/03 1,000

8/26/03 500

TOTAL 14,400

183. Plaintiff Bittman purchased 100 shares of Biopure common stock on June

5, 2003 and 420 shares of Biopure common stock on August 26, 2003.

184. Plaintiff Esposito purchased 600 shares of Biopure common stock on

August 12, 2003 and 600 shares of Biopure common stock on August 21, 2003.

SCIENTER ALLEGATIONS

185. The Defendants’ conduct, as detailed herein, in issuing false, deceptive

and misleading statements to the investing public about Biopure, Hemopure, the

Hemopure BLA, the Trauma Clinical Trials, the FDA’s safety concerns about Hemopure,

the clinical hold, and the Complete Response Letter, was conducted by the Defendants

knowingly, purposely, intentionally and recklessly, with the full knowledge that their

conduct would, and with the full intention that their conduct would, mislead, deceive and

act as a fraud upon the investing public.

186. In 2002, the Defendants Biopure and Rausch were named as defendants

in a federal securities fraud class action entitled, Thomas H. Meyer, et als. v. Biopure


78

Corporation and Carl W. Rausch, in the United States District Court for the District of

Massachusetts (Civil Action No. 02-10194-EFH). In that action the Plaintiffs alleged that

the Defendants had committed securities fraud by failing to disclose defects and

deficiencies in the clinical trials conducted for Hemopure. Judge Harrington of this

Court, in an Opinion reported at 221 F.Supp. 2d 195 (D. Mass. 2002), dismissed that

complaint. In so doing, Judge Harrington, in language extraordinarily relevant to, and

indeed, ironic in light of, the facts in this action, said:

Plaintiffs also plead no basis for inferring that it ishighly likely that these alleged omissions were eitherintentional or highly reckless...this is not a situation wherethe facts omitted from the press release are so clearlyimportant that the fact of non-disclosure alone givesrise to a strong inference of scienter, since plaintiffs donot suggest that the “missing” data would show thatHemopure was unsafe...

222 F. Supp. 2d at 207 (emphasis added).

187. Hence we see that even beyond the obvious materiality of the FDA’s

safety concerns and the Complete Response Letter, the Defendants knew full well, from

Judge Harrington’s decision in the Meyer v. Biopure case, that facts which “...would

show that Hemopure was unsafe...” Id., were not only material but “...so clearly

important that the fact of non-disclosure alone gives rise to a strong inference of

scienter...” Id. The Defendants’ failure to disclose the FDA’s safety concerns, the

clinical hold on the Trauma Clinical Trials prompted by those safety concerns and the

Complete Response Letter, under these circumstances, creates the strongest possible

inference of scienter.

188. Scienter is also apparent here from the fact that the SEC reached the

conclusion, based upon the facts alleged in this Complaint and the SEC Complaint,


79

incorporated herein by reference, that the Defendants Biopure, Moore and Richman

acted with scienter in violation of the federal securities laws due to their false and

misleading statements regarding, and their failure to disclose the truth about, Biopure,

Hemopure, the Hemopure BLA, the Trauma Clinical Trials, the FDA’s safety concerns

about Hemopure, the clinical hold, and the Complete Response Letter during the Class

Period. In light of that conclusion by the SEC, the SEC filed the SEC Action on

September 14, 2005.

189. Scienter is also apparent here from the fact that after the SEC staff’s

receipt of the responses by the Defendants Biopure, Moore and Richman to the SEC

staff’s Wells Notices, the SEC staff responded on April 29, 2004 by issuing additional

Wells Notices (advising that the SEC staff may recommend to the SEC that it also bring

action against the Defendants Sanders, Rausch and Crout, as well as Biopure’s general

counsel, Jane Kober, for violations of the federal securities laws due to their failure to

disclose the FDA’s Safety Concerns during the Class Period).

190. The Defendants’ scienter is also apparent from the highly significant and

material changes which the Defendants made to the False and Deceptive Statement

Regarding “If We Fail To Obtain FDA Approval,” after the SEC began its investigation of

the Defendants during Biopure’s fiscal quarter ended October 31, 2003. Specifically, in

the Form S-3 registration statement filed with the SEC on August 22, 2003, which was

signed by all of the Individual Defendants, except Richman, the Defendants replaced

the False and Deceptive Statement Regarding “If We Fail To Obtain FDA Approval,”

with the following statement:

If We Fail to Obtain FDA Approval, We Cannot MarketHemopure in the United States


80

We will not be able to market Hemopure in the United Statesunless and until we receive FDA approval. We filed anapplication for approval with the FDA, and the applicationwas accepted for review on October 1, 2002. The FDAadvised us that it would complete its review and take actionon the application by August 29, 2003. By letter dated July30, 2003, the FDA gave us comments on the application,stating that it had completed its review. We are working onour responses. However, the FDA could find that ourresponses do not address its issues adequately and couldrequire additional data or even further clinical trials ...prior toapproval of Hemopure. Trials are expensive and time-consuming and we may not have the financial resources tofund such trials. Despite all of our efforts, the FDA couldrefuse to grant a marketing authorization.

191. Significantly, this new version of this “risk disclosure,” while still false,

deceptive and misleading because the Defendants continued to fail to disclose in it the

FDA’s safety concerns, the clinical hold and the Complete Response Letter, no longer

contained the Defendants’ false and deceptive statement: “We believe that our

completed pivotal Phase III clinical trials are consistent with the FDA’s most

recent guidance on...safety endpoints required for approval of products such as

Hemopure for use in surgical indications...” which the Defendants had repeatedly,

falsely stated prior to August 22, 2003.

192. Another indicia of the Defendants’ scienter is seen from the disparity

between the Defendants’ evasive description of the status of the Trauma Clinical Trials,

and their straightforward description of the status of clinical trials of one of their potential

competitors. As detailed herein, due to the FDA’s safety concerns, the FDA placed the

Trauma Clinical Trials on clinical hold on April 9, 2003, immediately after Biopure

submitted a Phase II protocol for those trials. Thereafter, the FDA twice refused to lift

that clinical hold, the last such action having occurred on July 30, 2003 via the July 30,


81

2003 Clinical Trials Letter. Nevertheless, throughout the Class Period, the Defendants,

while repeatedly discussing the Trauma Clinical Trials, fastidiously avoided disclosing

the fact that the FDA had placed the Trauma Clinical Trials on a clinical hold. In

contrast, at his presentation at the above described ThinkEquity Conference on

September 17, 2003, when describing the research efforts of one of Biopure’s potential

competitors, the Defendant Moore had no hesitation in saying:

“Hemosol is now on a clinical hold. It is not clearwhether it will be able to resume.”

That exact same statement would have fully, accurately and non-deceptively described

the status of the Hemopure Trauma Clinical Trials throughout the Class Period, and the

Defendants could have, and should have, so disclosed the status of the Hemopure

Trauma Clinical Trials, during the Class Period. The fact that the Defendants made this

straightforward statement regarding the status of the clinical trials for their competitor’s

product, but did not do so regarding the Hemopure Trauma Clinical Trials, demonstrates

the Defendants’ scienter in purposely and intentionally failing to do so.

193. The Defendants’ scienter is also seen from their extraordinary motive to

deceive the investing public regarding the prospects of Biopure, Hemopure, the

Hemopure BLA, and the Trauma Clinical Trials. As the Defendants repeatedly

disclosed in their SEC filings, Biopure was dependent for its continued operations and

financial survival on its ability to periodically raise money from the investing public,

through the sale of shares of Biopure and warrants to buy shares of Biopure. As

detailed above, Biopure raised millions of dollars during the Class Period by selling its

shares to investors. Biopure’s ability to continue to sell its shares would have been

severely compromised by the Defendants’ disclosure of the FDA’s safety concerns, the


82

clinical hold in place on the Hemopure BLA, and the FDA’s transmission of the

Complete Response Letter.

194. The Defendants’ scienter is also evidenced by the fact that when the

September 12, 2003 Prospectus correctly identified the correspondence Biopure

received from the FDA on July 30, 2003 as being a “complete response letter,” and

when the Company’s stock then dropped 6.5% the next trading day on heavy trading

volume, Biopure’s Director of Corporate Communications intentionally, falsely, and

deceptively said that the reference to the July 30, 2003 correspondence as a “complete

response letter” had been a “mistake” by a “junior lawyer at a law firm” used by the

Company. The Defendants’ scienter is further demonstrated by the filing, on the next

trading day, of the September 15, 2003 Prospectus, which omitted the reference to the

FDA’s July 30, 2003 correspondence being a “complete response letter.”

195. The Defendants’ scienter is also seen by the sales by Biopure and Rausch

of hundreds of thousands of shares of Biopure stock during the Class Period, as

detailed herein.

INAPPLICABILITY OF THE EXCHANGE ACT’S THE SAFE HARBOR PROVISIONS FOR FORWARD-LOOKING STATEMENTS

196. The provisions of Section 21E of the Exchange Act, which provide, under

specified circumstances, a safe harbor from liability under the Exchange Act for “forward-

looking statements,” are not applicable to the claims asserted herein against the

Defendants.

197. Section 21E(c)(1)(B) provides that the safe harbor provisions of Section 21E

do not apply if the plaintiffs prove that the forward-looking statement:


83

(i) if made by a natural person, was made withactual knowledge by that person that thestatement was false or misleading; or

(ii) if made by a business entity; was

(I) made by or with the approval ofan executive officer of that entity;and

(II) made or approved by suchofficer with actual knowledge bythat officer that the statement wasfalse or misleading.

198. As demonstrated in detail herein, the Individual Defendants and Biopure had

actual knowledge of the FDA’s safety concerns and the clinical hold on the Trauma Clinical

Trials throughout the Class Period and actual knowledge of the Complete Response Letter

as of July 30, 2003. Hence, the false, misleading and deceptive statements of the

Individual Defendants were made by those Individual Defendants “with actual knowledge

by [those] person[s] that the statement[s were] false or misleading.” Likewise, the false,

misleading and deceptive statements by Biopure were “made by or with the approval of

[one or more] executive officer[s] of...” Biopure, and that the executive officers of Biopure

who made or approved those statements had actual knowledge “that the statement[s were]

false or misleading.”

199. Accordingly, the exemption provisions of Section 21E do not apply to and will

not exempt the Defendants from liability for the securities fraud claims asserted against

them in this action.

200. Furthermore the Defendants’ statements of their opinions, projections and

forecasts concerning Biopure, Hemopure, the Hemopure BLA, and the Trauma Clinical

Trials, during the Class Period, as detailed herein, were lacking in a reasonable basis at


84

all times and did not, in fact, constitute their truly believed opinions, projections and

forecasts concerning Biopure, Hemopure, the Hemopure BLA, and the Trauma Clinical

Trials, during the Class Period.

201. Furthermore, a significant number of the Defendants’ false, deceptive and

misleading statements, as detailed herein, were not “ forward looking statements,” but in

fact were statements (or misstatements) of existing fact and hence the exemption

provisions of Section 21E do not apply to and will not exempt the Defendants from liability

for the securities fraud claims asserted against them in this action.

CLASS ACTION ALLEGATIONS

202. The Lead Plaintiff brings this action as a class action pursuant to Federal Rule

of Civil Procedure 23(a) and (b)(3) on behalf of a Class (the “Class”) consisting of all

persons or entities (“Class Members”) who acquired shares of Biopure common stock from

April 9, 2003 through December 24, 2003, (the “Class Period”) and who were damaged

thereby. Excluded from the Class are Defendants; members of the individual defendant’s

immediate family; any past or present director, officer, subsidiary, or affiliate of Biopure; any

entity in which any excluded person or entity has a controlling interest; and their legal

representatives, heirs, successors and assigns.

203. The Plaintiffs also bring this action on behalf of a subset of the Class (the

“Sub-Class”) consisting of all persons or entities who acquired shares of Biopure common

stock contemporaneously with the sales of Biopure stock by the Defendants Biopure and

Rausch during the Class Period and who were damaged thereby. Excluded from the Sub-

Class are Defendants; members of the individual defendant’s immediate family; any past

or present director, officer, subsidiary, or affiliate of Biopure; any entity in which any


85

excluded person or entity has a controlling interest; and their legal representatives, heirs,

successors and assigns.

204. The members of the Class and Sub-Class are so numerous that joinder of all

members is impracticable. While the exact number of Class members is unknown to

Plaintiffs at this time and can only be ascertained through appropriate discovery, Plaintiffs

believe that there are thousands of members of the Class and Sub-Class located

throughout the United States. Throughout the Class Period, Biopure common stock was

actively traded in an efficient market on the NASDAQ. Record owners and other members

of the Class may be identified from records maintained by Biopure and/or its transfer agent

and may be notified of the pendency of this action by mail and publication, using forms of

notice similar to those customarily used in securities class actions.

205. Plaintiffs’ claims are typical of the claims of other members of the Class as

all members of the Class were similarly affected by Defendants' wrongful conduct in

violation of federal law that is complained of herein.

206. Plaintiffs will fairly and adequately protect the interests of the members of the

Class and have retained counsel competent and experienced in class and securities

litigation.

207. Common questions of law and fact exist as to all members of the Class and

predominate over any questions solely affecting individual members of the Class. Among

the questions of law and fact common to the Class are:

a. Whether the federal securities laws were violated by Defendants’ acts

and omissions as alleged herein;


86

b. Whether Defendants participated in and pursued the illegal course of

conduct complained of herein;

c. Whether statements disseminated to the investing public during the

Class Period were misrepresentations and/or suffered from omissions

of material information as alleged herein;

d. Whether, when defendants Biopure and Rausch sold shares of

Biopure during the Class Period, they were in possession of material,

adverse, non-public information regarding Biopure, including in

particular, inter alia, information regarding the FDA’s safety concerns,

the clinical hold on the Trauma Clinical Trials, and Biopure’s receipt

of the Complete Response Letter;

e. Whether the market price of Biopure common stock during the Class

Period was artificially inflated due to the material misrepresentations

and omissions complained of herein; and

f. The extent to which the members of the Class have sustained

damages and the proper measure of damages.

208. A class action is superior to all other available methods for the fair and

efficient adjudication of this controversy since joinder of all members is impracticable. As

the damages suffered by individual Class members may be relatively small, the expense

and burden of individual litigations make it impossible for members of the Class individually

to seek redress for the wrongs done to them. There will be no difficulty in the management

of this suit as a class action.


87

COUNT I

AGAINST ALL DEFENDANTS FOR VIOLATIONS OF SECTION 10(b) OF THE EXCHANGE ACT AND RULE10b-5 PROMULGATED THEREUNDER

209. Plaintiffs repeat and reallege each and every paragraph set forth above.

210. During the Class Period, Defendants, and each of them, carried out a plan,

scheme and course of conduct that was intended to and/or did: (i) deceive the investing

public, including Plaintiffs and other Class members, as alleged herein; (ii) artificially inflate

the market price of Biopure common stock; and (iii) cause Plaintiffs and other members of

the Class to buy Biopure stock at artificially inflated prices. In furtherance of this unlawful

scheme, plan, and course of conduct, Defendants, and each of them, took the actions set

forth herein.

211. These Defendants: (a) employed devices, schemes and artifices to defraud;

(b) made untrue statements of material fact and/or omitted to state material facts necessary

to make the statements not misleading; and (c) engaged in acts, practices and a course

of business which operated as a fraud and deceit upon the buyers of Biopure common

stock in violation of Section 10(b) of the Exchange Act and Rule 10b-5 promulgated

thereunder.

212. Defendants' material misrepresentations and/or omissions were done

knowingly or recklessly.

213. As a result of the Defendants’ dissemination of the deceptive and misleading

information regarding Biopure, Hemopure, the Hemopure BLA, and the Trauma Clinical

Trials, and their failure to disclose the FDA’s safety concerns regarding Hemopure, the

clinical hold on the Trauma Clinical Trials, and the Complete Response Letter, as set forth

above, the market price of Biopure’s common stock was artificially inflated during the Class


88

Period. In ignorance of the fact that the market price of Biopure’s shares were artificially

inflated, and relying upon the integrity of the efficient market in which Biopure common

stock trades, and/or on the absence of material information that was known to and/or

recklessly disregarded by Defendants but not disclosed in public statements by Defendants

during the Class Period, Plaintiffs and the other members of the Class bought Biopure

common stock during the Class Period at artificially inflated prices and were damaged

thereby when the price of Biopure stock thereafter declined due to the Defendants’

fraudulent conduct.

214. At the time of said misrepresentations and omissions, Plaintiffs and the other

members of the Class were ignorant of the omitted material facts and believed Defendants’

statements regarding Biopure to be completely truthful, candid and not deceptive or

misleading or suffering from omissions of material facts. Had Plaintiffs and the other

members of the Class known of the omitted material facts, Plaintiffs and the other members

of the Class would not have bought their Biopure common stock during the Class Period,

or, if they had bought such stock during the Class Period, they would not have done so at

the artificially inflated prices which they paid for their Biopure common stock which they

bought during the Class Period and they would not have suffered losses when the price of

Biopure stock thereafter declined due to the Defendants’ fraudulent conduct.

215. By virtue of the foregoing, each of the Defendants violated Section 10(b) of

the Exchange Act and Rule 10b-5 promulgated thereunder.

216. As a direct and proximate result of Defendants' wrongful conduct, Plaintiffs

and the other members of the Class suffered damages in connection with their purchases

of Biopure common stock during the Class Period.


89

COUNT II

AGAINST THE INDIVIDUAL DEFENDANTS PURSUANT TOSECTION 20(a) OF THE EXCHANGE ACT


218. This claim is asserted against the Individual Defendants pursuant to Section

20(a) of the Exchange Act, 15 U.S.C. §78t(a).

219. During the entire Class Period, the Defendants Moore, Rausch, Richards,

Sanders and Crout were “controlling persons” of Defendant Biopure, within the meaning

of Section 20(a) of the Exchange Act.

220. During the portion of the Class Period from April 9, 2003, to the date he

resigned or was terminated as Biopure’s Senior Vice President of Regulatory Affairs and

Operations, which was sometime prior to October 30, 2003, the Defendant Richman was

a “controlling person” of Defendant Biopure, within the meaning of Section 20(a) of the

Exchange Act.

221. The Individual Defendants were “controlling persons” of Biopure because, due

to the officer and/or director positions they held with Biopure, they had the influence and

power over Biopure to cause, and they did cause, Biopure to engage in the wrongful

conduct complained of herein, and because they had the power to have prevented Biopure

from engaging in the unlawful conduct alleged herein, but they purposely, intentionally and

recklessly did not use that power to do so.

222. As set forth above in Count I, Biopure violated Section 10(b) of the Exchange

Act and Rule 10b-5 promulgated thereunder by its acts and omissions as alleged in this

Complaint. By virtue of their status as “controlling persons” of Biopure, the Individual

Defendants are liable, to the same extent as is Biopure, for Biopure's violations of Section


90

10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder, pursuant to Section

20(a) of the Exchange Act.

COUNT III

AGAINST THE DEFENDANTS BIOPURE AND RAUSCH PURSUANT TOSECTION 20A OF THE EXCHANGE ACT


224. This claim is asserted against the Defendants Biopure and Rausch pursuant

to Section 20A of the Exchange Act. The Defendants Biopure and Rausch are hereinafter

sometimes referred to collectively as the “Section 20A Defendants.”

225. During the Class Period, the Defendants Biopure and Rausch, while in

possession of the non-public material adverse information regarding the Company, sold

millions of dollars of shares of the Company. Because the Section 20A Defendants

possessed material adverse information about the Company which was not known to the

investing public, including the members of the Sub-Class, Section 20A Defendants sold

their shares of the Company at artificially inflated prices and the members of the Sub-

Class, who purchased shares of the Company contemporaneously with the sales by the

Section 20A Defendants, paid artificially inflated prices for those shares of the Company,

and were damaged thereby.

226. Pursuant to Section 20A of the Exchange Act, the Defendants Biopure and

Rausch are liable to the members of the Sub-Class for the difference between the inflated

prices at which they sold their shares of the Company during the Class Period, and the

prices at which those shares would have sold had the investing public known the material

adverse information about Biopure which was known to the Section 20A Defendants.


91

PRAYERS FOR RELIEF

WHEREFORE, Plaintiffs, on behalf of themselves and the Class, pray for judgment

as follows:

A. Declaring this action to be a class action properly maintained pursuant to Rule

23(a) and (b)(3) of the Federal Rules of Civil Procedure;

B. Finding that the Defendants violated Section 10(b) of the Exchange Act and

Rule 10b-5 promulgated thereunder by their acts and omissions as alleged in this

Complaint;

C. Finding that the Defendants Biopure and Rausch violated Section 20A of the

Exchange Act by their acts and omissions as alleged in this Complaint;

D. Awarding Plaintiffs and the members of the Class and the Sub-Class

damages, together with interest thereon;

E. Awarding Plaintiffs and other members of the Class and the Sub-Class their

costs and expenses of this litigation, including reasonable attorneys' fees and experts' fees

and other costs and disbursements; and

F. Awarding Plaintiffs and other members of the Class and the Sub-Class such

other and further relief as may be just and proper under the circumstances.


92

JURY TRIAL DEMAND

Plaintiffs demand a trial by jury.

By the attorneys for the Plaintiffs and the Classand the Sub-Class,

SHAPIRO HABER & URMY LLP

By: /s/ Edward F. HaberEdward F. Haber BBO No. 215620Matthew L. Tuccillo BBO No. 643336Shapiro Haber & Urmy LLP53 State Street, 37th Fl.Boston, MA 02109(617) 439-3939

Jules BrodyHoward T. LongmanStull Stull & Brody6 East 45th StreetNew York, NY 10017(212) 687-7230

Dated: March 28, 2006


Exhibit A

to PROPOSED SECOND CONSOLIDATED AMENDED COMPLAINT


UNITED STATES DISTRICT COURTDISTRICT OF MASSACHUSETTS

SECURITIES AND EXCHANGE COMMISSION, ;

Plaintiff,v .

r _C(op'y

Civil Action No'.

JURY TRIAL DEMANDEDBIOPURE CORPORATION ,THOMAS MOORE, HOWARD RICHMAN,and JANE KOBER

Defendants . :05 CA 11853 WGYCOMPLAINT

Plaintiff Securities and Exchange Commission (the "Commission") alleges :

Summary

1 . In 2003, Biopure Corporation ("Biopure"), and its chief executive officer, head o f

regulatory affairs and general counsel engaged in a fraudulent scheme to misrepresent and

conceal from investors the truth about its applications for Food and Drug Administratio n

("FDA") approval of Hemopure .

2. Hemopure is a biotechnology product that is designed to deliver oxygen to tissues

as a substitute for red blood cells . To date, Hemopure has not been approved by the FDA for us e

in humans . Since its founding in 1984, defendant Biopure has devoted substantially all of it s

resources toward developing Hemopure for human use . In July 2002, Biopure submitted a

biologics license application ("BLA") to the FDA for approval to use Hemopure for the treatment

of acutely anemic patients undergoing orthopedic surgery . In March 2003, the company also

applied for FDA approval to perform clinical trials of Hemopure on human trauma victims in

hospitals .

3 . In April 2003, Biopure began receiving negative information from the FDA. On

or about April 9, 2003, the FDA imposed a clinical hold barring the company from conductin g

clinical trials of Hemopure on trauma victims because of "safety concerns" arising out of th e

FDA's preliminary assessment of Biopure's BLA . In or about May 2003, the FDA denied

Biopure's request to lift the clinical hold. Then, on or about July 30, 2003, Biopure received two

lengthy and detailed letters from the FDA. In one letter, the FDA again refused to allow the

clinical trials because of "an unreasonable and significant risk of illness or injury" to huma n

subjects . The other letter was the FDA's complete response letter to the BLA, in which the FDA

informed Biopure that it was not approving Biopure's BLA at that time because of extensive an d

significant deficiencies in Biopure ' s application and because of concerns about the lack of safety

and efficacy of Hemopure. Receipt of the complete response letter meant that the FDA had

completed its review of the BLA and would have an additional six months to review a

resubmission by the company, if and when the company addressed all deficiencies identified b y

the FDA. One year later, the company still had not addressed all deficiencies raised in the

complete response letter and decided instead to shift its focus to developing Hemopure for a

different application .

4 . Throughout 2003, Biopure was also in need of additional capital to satisfy it s

continuing financial needs. Biopure had not been profitable at any point since its founding .

Several times during 2003, as it had done previously and since, Biopure was seeking to rais e

money by accessing public and private capital markets through the sale of additional shares o f

stock .

2

5. For more than eight months from April 9 until December 24, 2003, Biopure

concealed the clinical hold from investors while touting a potential use of Hemopure by trauma

victims in multiple securities offerings, public filings, press releases and investor conferenc e

calls . Moreover , on August 1, 2003, two days after receiving the complete response le tter from

the FDA, Biopure issued a fraudulent and misleading press release that gave the false impressio n

the company had received positive news from the FDA. That day, Biopure's stock closed at

$7.30 per share, a 22% increase over its previous day close . For four additional months from

August until December 11, 2003, Biopure continued to conceal from investors that it ha d

received a complete response letter from the FDA, continued to make false statements about its

dealings with the FDA and failed to disclose the true scope and nature of the deficiencies with

the BLA identified by the FDA . Indeed, on one occasion in September 2003, Biopure disclose d

in a prospectus filed with the Commission that the July 30 letter it received was a complete

response letter. When Biopure's stock price dropped on heavy trading, the company tol d

investors that the reference to the letter as a complete response letter was a "mistake" by a

"junior lawyer at a law firm" retained by the company . The disclosure was quickly "fixed" with

the filing of an amended prospectus that omitted the reference to the letter as a "complete

response letter ."

6. As the truth about Biopure 's applications for FDA approval gradually became

public, through a series of incomplete disclosures, the market reacted . As of year-end 2003 ,

Biopure stock was trading below $3 .00 per share .

7. By engaging in the scheme set forth in this Complaint, Biopure engaged in acts ,

practices and courses of business that constitute violations of Section 17(a) of the Securities Ac t

3

of 1933 ("Securities Act") and Sections 10(b) and 13(a) of the Securities Exchange Act of 193 4

("Exchange Act") and Rules l Ob-5, 12b-20, 13a-11 and 13a-13 thereunder . Additionally, by

engaging in the scheme set forth in this Complaint, each of individual defendants Moore ,

Richman, and Kober violated Section 17(a) of the Securities Act, Section 10(b) of the Exchang e

Act and Rule I Ob-5 thereunder and aided and abetted Biopure's violations of Section 13(a) of th e

Exchange Act and Rules 12b-20, 13a-11, 13a-13 thereunder, and defendant Moore furthe r

violated Rule 13a-14 of the Securities Act .

8 . Unless restrained and enjoined, defendants will continue to engage in acts ,

practices, and courses of business as set forth in this Complaint or in acts, practices, and course s

of business of similar object and purpose . Accordingly, the Commission seeks : (i) entry of a

permanent injunction prohibiting each defendant from further violations of the relevan t

provisions of the federal securities laws ; (ii) orders barring each of defendants Moore, Richman ,

and Kober from serving as an officer or director of a public company ; (iii) the imposition ofa

civil monetary penalty in light of the egregious nature of defendants violations ; and (iv) other

equitable relief as the Court in its discretion deems just .

Jurisdiction

9. The Commission brings this action pursuant to Section 20 of the Securities Ac t

[15 U.S .C. §§ 77t], and Sections 20(e) and 21 (d) of the Exchange Act [15 U . S .C. §§ 78t(e) and

78u(d)] .

10. This Court has jurisdiction over this action pursuant to Sections 20 and 22(a) of

the Securities Act [15 U .S .C. §§ 77t and 77v(a)] and pursuant to Sections 21 and 27 of the

Exchange Act [15 U.S .C . §§ 78u and 78aa] . Additionally, . defendant Biopure's principal place o f

4

business is in this District and many of the acts and practices set forth in this Complaint occurre d

in this District.

11 . In connection with the conduct described in this Complaint, each of defendants

directly and indirectly made use of the mails or the means or instruments of transportation or

communication in interstate commerce .

The Defendants

12 . Biopure , a Delaware corporation, is a biopharmaceutical company wit h

headquarters in Cambridge, Massachusetts . Biopure's common stock is registered under Sectio n

12(g) of the Exchange Act and trades on the NASDAQ Stock Exchange under the symbo l

"SPUR." Biopure has essentially one product, an oxygen therapeutic derived from bovine

hemoglobin, which Biopure developed for use as a blood substitute . The form of the produc t

intended for hum an use , called Hemopure , has not been approved by the FDA .

13 . Thomas Moore, 54, served as President, Chief Executive Officer and a directo r

of Biopure from July 2002 until the Board of Directors requested his resignation in Februar y

2004 . Prior to joining Biopure, defendant Moore held various positions at Proctor and Gambl e

Company from 1973-1996, including President of Global Healthcare . From 1996-2002 ,

defendant Moore was President and Chief Executive officer of a medical communications an d

marketing company which provided consulting services to Biopure . Defendant Moore is a

resident of Boston, Massachusetts .

14. Howard Richman, 53, was Biopure's Senior Vice President of Regulatory

Affairs and Operations from spring 2003 until October 2003, when Biopure terminated hi s

employment. He previously served as Biopure's Vice President of Regulatory Affairs and

Compliance from 2001 through the spring of 2003 . Prior to joining Biopure, defendant Richman

was a director of regulatory affairs at several biotech companies . Defendant Richman was a

practicing doctor of podiatric medicine from 1978-1992 . Defendant Richman is a resident of

Houston, Texas .

15 . Jane Kober , 62, is currently Senior Vice President, General Counsel, an d

Secretary of Biopure. Defendant Kober joined Biopure in May 1998, after serving as outside

corporate counsel to the company from 1985-1986 and from 1990 until 1998 . Defendant Kober

is a resident of Bellport, New York.

BACKGROUND

16. The FDA , an agency within the U . S . Department of Health and Human Services ,

is responsible for promoting the public health by promptly and efficiently reviewing clinica l

research and taking appropriate action on the marketing of regulated products in a timely manner .

Specifically, the FDA is responsible for protecting the public health by ensuring that foods are

safe, wholesome, sanitary, and properly labeled ; human and veterinary drugs are safe and

effective ; there is reasonable assurance of the safety and effectiveness of devices intended fo r

human use ; cosmetics are safe and properly labeled; and the public health and safety are

protected from electronic product radiation :

17. The Center for Biologics Evaluation and Research ("CBER") is a center within

the FDA that regulates biologics , such as Hemopure , for human use . Biologics , which are also

called biologic products or biological products, are products that generally are derived from

living sources, in contrast to drugs, which generally are chemically synthesized .

6

18. Companies that manufacture biologics for introduction into interstate commerc e

are required to hold a license for the products . These licenses are issued by the FDA, through

CBER . Licensing of biologics is similar to the new drug approval process for hum an drugs, and

generally proceeds as follows : First, a manufacturer conducts initial laboratory and anima l

testing of the biologic , which does not require prior FDA approval . Next, a manufacturer

submits an investigational new drug ("IND") application to the FDA for permission to conduct

clinical trials in humans for a particular indication . Following clinical trials, the manufacturer

will submit a biologics license application ("BLA") to the FDA for approval . The FDA 's review

of new BLAs, and for new indications for already approved products, requires evaluating the

scientific and clinical data submitted by manufacturers to determine whether the product meets

the FDA's standards for approval .

19. During the relevant period, the FDA' s performance goals and procedures , adopted

in connection with the Prescription Drug User Fee Act of 1992, as periodically reauthorized

("PDUFA"), provided that the FDA had ten months to review a BLA . The FDA was als o

entitled to a 90-day extension if an applicant were to submit a major amendment to it s

application during the final three months of the review period . Once the FDA completed it s

review of a BLA, if a product met the standards for approval, the FDA would approve th e

product for marketing. If the product did not meet the standards for approval, the FDA woul d

issue a "complete response letter" (sometimes referred to as an "action letter") setting forth th e

deficiencies of the application .

20. After the FDA issues a complete response letter for a BLA, the applicant coul d

make a further submission. For non-minor resubmissions , PDUFA performance goals and

7

procedures provided the agency with an additional six months to reply to the applicant' s

response, once the applicant had answered all questions and addressed all deficiencies set forth in

the complete response letter .

Hemopure and its Significance to Biopure

21 . Hemopure is Biopure's brand name for hemoglobin glutamer - 250 (bovine), a n

oxygen therapeutic derived from cow's blood that is designed to deliver oxygen to tissues as a

substitute for red blood cells. Hemopure is one of only two products manufactured by Biopure .

Oxyglobin, Biopure's other product, is an oxygen therapeutic created for veterinary use .

22. To date, the FDA has not approved the use of Hemopure in humans for an y

indication .

23 . The development, approval by the FDA and ultimate success of Hemopure ar e

highly material to Biopure . Since its inception in 1984, Biopure has devoted substantially all o f

its resources to the research, development and manufacturing of its oxygen therapeutic products .

Although the company began generating revenue from the sale of Oxyglobin in 1998, Biopur e

has never been profitable . As of October 2002, the company had an accumulated deficit of mor e

than $380 million . As of October 2003, the company's accumulated deficit had grown to mor e

than $425 million .

24. Biopure's long-term prospects, even survival, are dependent upon receiving FD A

approval for Hemopure. Biopure's short-term prospects during the relevant period depended als o

on obtaining the funding necessary to maintain the company's operations . As the company

disclosed to investors in its Form 10-K filed with the Commission for fiscal year 2002, date d

January 29, 2003, "[i]n order for us to remain a going concern we will require significant

8

funding ."

Biopure 's Biologics License Application (BLA)

25 . On or about July 31, 2002, Biopure submitted a BLA to the FDA seekin g

approval to use Hemopure in the treatment of acutely anemic patients undergoing orthopedi c

surgery . For Hemopure to receive FDA approval for that indication , Biopure had to demonstrate

that human clinical trials had established both the safety and efficacy of Hemopure . Under

PDUFA goals and procedures, the FDA's target date for completing review of Biopure's BL A

and sending the company either an approval letter or a complete response letter was at the end o f

May 2003 .

26. In a letter to shareholders dated February 4, 2003, which was contained in

Biopure's fiscal 2002 Annual Report, defendant Moore touted the filing of Biopure's BLA and

described the company's priorities. The letter begins by declaring that Biopure "realized a

tremendous achievement" by filing its BLA for use of Hemopure in an orthopedic surger y

setting . Defendant Moore further stated that Biopure "anticipate[s] that the [FDA] will complete

its review of our BLA by mid 2003 ." The letter described Biopure' s "Business Strategy" with

four bullet points . The first bullet referred to Biopure 's BLA: "[s]uccessfully launch Hemopure

under an orthopedic surgery indication in the United States ." The second bullet referred to it s

trauma trials : "[c]linically develop Hemopure for trauma, ischemia, and adjunctive cance r

therapy indications ."

27. Under the heading, "Changing Gears for the Future," defendant Moore told

investors that Biopure was developing Hemopure for use by trauma victims : "Our first clinical

priority is to demonstrate the product's utility in stabilizing trauma patients in the emergenc y

9

room and pre-hospital, or ambulance, setting . "

Biopure Submits a Trauma IND and the FDA Imposes a Clinical Hol d

28. On or about March 7, 2003, Biopure ostensibly took a step toward achieving its

"first clinical priority" by submitting an IND application to the FDA seeking permission to

conduct clinical trials of Hemopure on human trauma victims in hospitals . In support of its

submission , Biopure relied upon and referred the FDA to data from the pivotal clinical trial

previously submitted in support of its pending BLA .

29 . On or about April 9, 2003, members of the FDA staff telephoned defendan t

Richman, Biopure's primary contact with the FDA, to inform Biopure that the agency wa s

imposing a clinical hold barring the company from initiating any clinical trials in connection wit h

the trauma IND. The FDA staff stated that the clinical hold was imposed because of "safety

concerns" arising out of data relating to the BLA clinical trials and because of "a preliminary

assessment of the BLA." Specifically, the FDA staff expressly referred to data relating to serious

adverse events suffered by participants in the BLA clinical trials, and stated that "the trial was on

hold for safety and that in FDA's judgment it is unsafe to put this product in this patien t

population at this time."

30. Although he was not on the April 9 telephone call with the FDA, defendan t

Moore learned of the clinical hold by April 10, 2003, the next day. Defendant Kober was made

aware, at least , that the FDA had questions about Biopure ' s trauma IND by early May and

learned of the clinical hold no later than June 17, 2003 .

10

Biopure Begins Raising Money from InvestorsWithout Disclosing the Clinical Hold

31 . On or about April 16 and April 17, 2003, after learning of the clinical hold ,

Biopure filed with the Commission a Post-Effective Amendment No . 1 to a Form S- 3

Registration Statement that had been filed in March 2003 and Rule 424(b)(3) prospectus

supplements ("April Offering Documents ") for the sale of up to 1,000,000 shares of common

stock and warrants for the purchase of up to 500,000 shares of common stock . The April

Offering Documents were signed by defendant Moore . Defendants Moore and Kober

substantially participated in drafting, reviewing and/or approving the April Offering Documents ,

and defendant Richman reviewed disclosures regarding the regulatory status of Biopure's FD A

submissions .

32 . In the April Offering Documents, Biopure made the following statements, among

others :

We Cannot Expand Indications for Our Products Unless We Receive FDAApproval for Each Proposed Indication

The FDA requires a separate approval for each proposed indicationfor the use of Hemopure in the United States . We have applied for anindication for Hemopure that will only involve its perioperative use inpatients undergoing orthopedic surgery . Subsequently, we expect toexpand Hemopure's indications . To do so, we will have to designadditional clinical trials, submit the trial designs to the FDA for reviewand complete those trials successfully . . . .

The Company expects to initiate additional pre-clinical and clinical trialsthis year to expand the indications for Hemopure beyond surgery.

11

We are also developing Hemopure for potential use in trauma and othermedical applications .

33 . Biopure's April Offering Documents were false and misleading because they

misled investors about the true status of Biopure's clinical trials for the trauma indication . For

example, although they discussed the potential use of Hemopure for trauma victims, the Apri l

Offering Documents misled investors by failing to disclose that the FDA had barred Biopure

from conducting clinical trials on trauma victims for safety reasons . The April Offerin g

Documents further misled investors by falsely stating that an indication involving Hemopure' s

perioperative use in orthopedic surgery was the "only" indication applied for, when, in truth ,

Biopure had also sought permission to conduct trials for the trauma indication . The Apri l

Offering Documents further misled investors by disclosing a future "expectation" to expand

Hemopure's indications, design additional trials and submit them to the FDA for review, when ,

in truth, Biopure already had designed additional clinical trials, submitted the trial designs to th e

FDA for review, and received a clinical hold from the FDA. The April Offering Documents

further misled investors by referring to development plans for the trauma indication without

disclosing that the FDA placed the trauma indication on clinical hold for safety reasons arising

out of the FDA's preliminary assessment of Biopure's BLA .

The FDA Confirms the Clinical Hold in Writing andInforms Biopure of Serious Concerns Relating to its Pending BL A

34. On or about April 25, 2003 , the FDA sent Biopure a le tter, addressed to defendant

Richman, confirming that it had imposed a hold on clinical trials of the trauma IND becaus e

"subjects would be exposed to an unreasonable and significant risk of injury" ("April 25 Letter" )

The April 25 Letter reiterated that the safety concerns that compelled the imposition of a clinical

12

hold arose out of a preliminary assessment of the company's BLA. The FDA stated that " results

of a pivotal human trial, used in support of the Hemopure BLA, and referred to in the IND ,

indicated that use of Hemopure, compared to human blood was associated with a highe r

incidence of life-threatening SAEs [Serious Adverse Events] , including death and cardiac arrest."

Defendants Moore and Richman received a copy of the April 25 Letter by no later than April 30 ,

2003 .

Biopure Continues to Raise Money from Investors Without Disclosing'the Clinical Hold or the FDA's Serious Concerns Relating to its Pending BL A

35 . On or about May 6, 2003, Biopure filed with the Commission a Rule 424(b)(3 )

prospectus supplement to the April Offering Documents, dated May 2, 2003, and a Rule

424(b)(3) prospectus supplement to the April Offering Documents, dated May 5, 200 3

(collectively, the "May Prospectus Supplements") . The May Prospectus Supplements, in the

aggregate, provided for the sale of up to 1,715,687 shares of common stock and warrants t o

purchase up to 343,138 shares of common stock. The May Prospectus Supplements incorporate d

by reference certain of Biopure prior public filings, including prior offering documents an d

periodic reports . Defendants Moore and Kober substantially participated in drafting, reviewin g

and/or approving the May Prospectus Supplements, and defendant Richman reviewed disclosures

regarding the regulatory status of Biopure's FDA submissions .

36. Biopure's May Prospectus Supplements were false and misleading because they

failed to disclose that the FDA had barred Biopure from conducting clinical trials of Hemopur e

on trauma victims for safety reasons arising out of a preliminary assessment of Biopure's BLA.

The May Prospectus Supplements further misled investors by incorporating by reference the fals e

13

and misleading statements and omissions contained in the April Offering Documents .

Biopure Unsuccessfully Petitions the FDA to Lift the Clinical Hold andContinues to Raise Money from Investors Without Disclosin g

the Clinical Hold or the FDA' s Serious Concerns Relating to its Pending BLA

37 . On May 12, 2003, in response to the FDA' s clinical hold, Biopure made an

extensive submission to the FDA to request that the FDA lift its clinical hold . The submission ,

termed a "complete response" to the FDA's April 25 Letter, was signed by defendant Richman,

defendants Moore and Richman participated in drafting and reviewing it, and defendant Kober

was aware of the submission when it was made .

38. On or about May 14, 2003, Biopure filed a Form 8-K with the Commissio n

("May 14 Form 8-K") . Defendants Moore and Kober reviewed and approved the May 14 For m

8-K prior to its filing.

39. The May 14 Form 8-K attached as an exhibit a Standby Equity Distribution

Agreement, dated April 16, 2003, between Biopure and BNY Capital Markets, Inc . ("CMI")

pursuant to which Biopure could issue and sell up to $10,000,000 of shares of its class A

common stock from time to time through CMI, as Biopure's exclusive agent for the offer an d

sale of the shares . Among the terms of the agreement that disclosed in the May 14 Form 8-K wa s

Biopure's representation and warranty that the company's registrations statements and

prospectuses :

. . . conformed and will conform in all material respects to therequirements of the Exchange Act and the rules and regulations of theCommission promulgated thereunder, and none of such documentscontained or will contain at such time an untrue statement of a materialfact or omitted or will omit to state a material fact necessary to make thestatements therein, in the light of the circumstances under which they weremade, not misleading .

14

40. The May 14 Form 8-K was false and misleading to investors because, as described

herein, the April Offering Documents and May Prospectus Supplements contained untrue

statements of material fact or omitted to state material facts necessary to make the statement s

therein, in the light of the circumstances under which they were made, not misleading .

41 . On May 22, 2003, Biopure issued a press release announcing its results for th e

second quarter of fiscal year 2003 ("May 22 Press Release") and included the text of the releas e

in a Form 8-K filed with the Commission ("May 22 Form 8-K") . Defendants Moore, Richman ,

and Kober each substantially participated in drafting , reviewing and/or approving the May 22

Press Release .

42. The May 22 Press Release contained a section entitled , "Recent Corporate

Events." Among the "Recent Corporate Events" listed was a statement referring to clinical trials

for a trauma indication : "Biopure is preparing for a Phase 2a in-hospital trauma trial . "

43. The May 22 Press Release was misleading to investors because, among other

things, although the May 22 Press Release described planned clinical trials for a traum a

indication , Biopure concealed the truth from investors , that the FDA had placed the in-hospital

trauma trial on clinical hold due to safety concerns arising out of its preliminary assessment o f

the BLA .

44. That same day, May 22, 2003, defendants Moore and Richman part icipated in a

conference call with analysts and investors regarding the earnings release for the second quarte r

("May 22 Investor Call") . During the May 22 Investor Call, defendant Moore stated, among

other things :

15

[W]e continue to be very hopeful of an [FDA] response on our [biologics]license application by mid-year or sooner, and we continue to not be awareof any major issues with that application at this time .

Our aim will be to have the product, again, assuming we get approved, onor about June 1st to the end business [sic] and moving product no laterthan October 1st.

Parkman Hospital is going to be our initial clinical center to conduct thealready announced in-hospital trauma trials that will set us up forsubsequent pre-Hospital trials to establish an additional trauma indicationfor Hemopure .

45. The May 22 Investor Call was false and misleading because defendants Moore

and Richman misled investors about the true information the company had received from th e

FDA. For example, the statement that "we continue to not be aware of any major issues with tha t

application at this time " was false and misleading because the FDA had already informe d

defendants of serious concerns about data from the pivotal BLA clinical trial , which necessitated

imposing a bar on clinical trials on trauma victims for safety reasons . Moreover, the clinical hold

was imposed based on the FDA's preliminary assessment of the BLA . In addition, the reference

to a particular hospital as Biopure's "initial clinical center to conduct the already announce d

in-hospital trauma trials" misled investors because defendants failed to disclose that the clinica l

hold barred Biopure from initiating the "already announced in-hospital trauma trials ." The May

22 Investor Call was further misleading because although defendants touted the potential use o f

Hemopure for trauma victims, they failed to disclose that the FDA had barred Biopure from

conducting clinical trials on trauma victims for safety reasons based on the FDA' s preliminary

16

assessment of the BLA.

Biopure 's Submission Fails to Persuadethe FDA to Lift the Clinical Hol d

46 . On or about May 30, 2003, the FDA sent two letters to Biopure , addressed to

defendant Richman, in response to Biopure's May 12 request to lift the clinical hold . In one May

30 letter, the FDA informed Biopure that the clinical hold would not be lifted . The FDA stated

that Biopure ' s request contained se rious inconsistencies and failed to address the FDA's safety

concerns . In addition, the FDA informed Biopure that its "conclusions about product safet y

remain unchanged," and the FDA required the company to conduct " at least three additional

studies in conscious swine" to address particular concerns prior to any testing in humans .

47. In the other May 30 letter to Biopure, the FDA informed Biopure that it was

extending the deadline to complete its review of Biopure's BLA for 90 days, until August 29 ,

2003 . The FDA expressly stated that the extension was taken because information submitted by

Biopure in its May 12 request to lift the clinical hold on the trauma indication contained

significant new analyses of the BLA clinical data and therefore was a "major amendment" to

Biopure's BLA .

48. Defendants Moore and Richman received copies of both May 30 letters on or

about May 30, 2003, and defendant Kober received a copy of, at least, the May 30 lette r

extending the deadline for the FDA to complete its review of the BLA on or about May 30, 2003 .

Biopure Discloses False Reasons for the 90-day Extension andMisleadingly Characterizes the Extension as Positive News for the Compan y

49. On May 30, 2003, after receiving both May 30 letters from the FDA, Biopure

issued a press release ("May 30 Press Release") and held a conference call with investors an d

17

analysts ("May 30 Investor Call") . Defendants Moore, Richman, and Kober each substantially

participated in drafting, reviewing and/or approving the May 30 Press Release .

50. The May 30 Press Release stated, among other things, that :

Biopure submitted its BLA on July 31, 2002 . Under FDA performancegoals . . ., the agency has up to 10 months from the submission date toreview and act on the BLA, making the original action due date June 1,2003 . As part of the normal review process, Biopure has responded toFDA questions regarding the application . The agency has classified thelatest responses submitted in mid-May 2003 as additional analyses ofpreviously submitted data, which under FDA standard operatin gprocedures automatically provides the agency up to three months beyondthe original action due date to review the data .

51 . Biopure's May 30 Press Release was false and misleading because it misle d

investors about the true information the company had received from the FDA . For example, the

May 30 Press Release falsely stated that Biopure had responded to FDA questions regarding th e

BLA, when, in truth, the company had responded to questions relating to the trauma IND and the

clinical hold, which the company had never disclosed . The May 30 Press Release further falsely

stated that Biopure 's submission was "part of the normal review process" of the BLA and was

Biopure' s "latest responses" to FDA questions on the BLA, when, in truth, the submission wa s

the company's complete response to the FDA's April 25 clinical hold letter and was expressly

made in an effort to persuade the FDA to lift the clinical hold .

52. In addition, the May 30 Press Release failed to disclose, among other things, tha t

the 90-day extension resulted from Biopure 's request to lift the clinical hold. The May 30 Press

Release failed to disclose that the FDA had placed the trauma IND on clinical hold. The May 3 0

Press Release further failed to disclose that the FDA had refused to li ft the clinical hold even

after Biopure had made a subst antial submission to the agency . The May 30 Press Release

18

further failed to disclose that the clinical hold was imposed based on the FDA's concerns abou t

the safety of Hemopure arising out of the same data that was submitted in support of the BLA.

53. Later that same day, defendants Moore and Richman participated in the May 3 0

Investor Call with investors and analysts . During the May 30 Investor Call, defendant Moor e

stated, among other things :

We view this notification [of the 90-day extension] as a very positive

development for Hemopure. First of all, we have a date which the agency

has indicated their intent to give us an action letter. Second, it confirms

what we already knew, that is, that the agency has devoted considerable

effort to this application. And third, as we also already knew, that now our

investor community knows, there is nothing in our application which is

warranted a denial of that application at the three key decision points

we've passed so far in the PDUFA process . By that, I mean our BLA was

accepted, it was also continued through the mid-cycle review conducted by

the agency, and now, at the PDUFA guideline date for a first response,

we've not had a denial, but rather a going forward to additional

consideration . The added time we're going to get over the next three

months will not only allow us to insure we can fully answer any additional

questions the FDA might choose to send our way, but also allow us tocomplete legal negotiations and to continue forward with the commercial

preparations we are making against a hopeful approval on August 29th for

the name of introducing this product on or about the October introductory

guideline we mentioned in our conference call last week. So we feel very

positive about this . . . .

54. Also during the May 30 Investor Call, defendants Moore and Richman engaged i n

colloquies with stock analysts who participated in the call :

Analyst 1 : [D]id the FDA request any additional data to be submitted, or why do you thinkthat basically the FDA extended the timeline for the review process ?

Moore: The FDA did not request any additional data . . . .

Richman : . . . This is what normally happens with any submission . As Tom has told thepublic over the past many months, is that we are in continued dialogue with theagency and during that period of time, they have requested information which wehave sent back to them . It's a normal process with any application . Be that as i t

19

may, the agency, during the course of reviewing the information has theopportunity to take additional time to allow them to give a complete andadditional thorough review of all information to make a thorough conclusion o napplication. This type of response from the FDA is very common with biologiclicensing applications . Most recently, in 2001 and 2002, of the 11 BLAB that weresubmitted to the Food and Drug Administration, all 11 of them went on to theextended period of time for review which was outside the normal PDUFA 10months . It is within the PDUFA guidelines to allow them to do that and they stillmeet their matrix for approval for their guidance acumen.

Analyst 2 : . . . I guess I'm a little bit confused on the timing of the submission of whatever itis you did submit to the FDA given that your original BLA was submitted in July31st of last year. I guess my question is why are you still having to provideinformation to the FDA? You said mid-May there was a resubmission of somesort. Why nine and a half months after the original BLA was submitted are youstill having to provide information ?

Moore: It's actually . . . it's a continual process of providing information . I'm going tolet Howard comment on this specifically, but it would be difficult to categorizehow many hundreds of questions we've answered in the review of this BLA todate. This mid-May submission was some additional analysis which we providedon data that was already in the BLA. At the time, we didn't consider it a majoramendment to the BLA but the FDA looked at that as a reason to extend it . ButI'll let Howard comment on that.

Richman : . . . Just as a point of clarification this is a normal occurrence . I've been lucky tobe involved with 12 other approval processes outside of Biopure,and this is anormal thing that happens . We're, in fact, in constant contact with the agencywhen they're requesting information in real time . So this is not anything new thatcan happen . And what we have done is supply responses back to their continualquestions to allow them, again, as I mentioned earlier, to give complete andthorough response to this first in class application .

Analyst 2 : I understand there was a continuing dialogue and questions and answers, but itwould seem that for there to be some so rt of submission that would extend thePDUFA date another two months, it would have to be something material. And Iguess I'm just surprised that nothing was disclosed in mid-May when thisadditional submission was made .

Moore : To be clear, we were simply responding to a new set of questions from FDA. Itdid not involve any new data . And so frankly, it was well within the range of

20

other questions we've answered in the past. When we made that response, wedidn't characterize it as a major amendment to the BLA. I think the FDA chose todo that and I think that really , how do I phrase this diplomatically , I think that's away for them to get this additional consideration time as opposed to some startlingnew insight on the application . But that ' s not my role to call I would say, asHoward has already said , so far the FDA's extended on 11 straight BLAs, sowe're number 12 .

Analyst 3 : . . . Could you please be a little more specific in terms of -- the company hassubmitted additional analyses of previously submitted data . Could you be a littlemore specific as to what elements of the clinical data that that refers to ?

Moore: I can't be a lot more specific .

Analyst 3 : I mean, is it safety, is it statistical procedure, is it some auditing of patient

records? I mean, could you just be somewhat more specific ?

Moore: Well, all patient records have been audited and so all that's been done, so that'snot at issue as far as I know anyway .

Analyst 3 : Or merely is it formatting or you know?

Moore: It's actually - - it was a dialogue really about how to look at the clinical data . Asyou know, there are various analyses used to look at our efficacy and safety dataand we just had a dialogue about the different ways you could look at the analysesthat are performed on the data. And that's really as far as I want to characterize it .

Analyst 3 : But could you just give us maybe a broader ballpark sense as to - - you know, justa broad area that it is -- is there a specific area that it's in that's a broad area thatmaybe you could characterize it? That's more specific than just it's the clinicaldata?

Moore: Well, I mean, all the clinical data has to do with safety and efficacy . That's theonly thing in measure in these clinicals . And so, the dialogue is over thoseclinical and safety and efficacy data . And again, we have answered somequestions on a pretty broad basis . When I talk about it as how to look at theclinical analysis, it's exactly what it was . So I think that's as far and as specific asI really want to be at this point.

55. The May 30 Investor Call was false and misleading because defendants Moor e

21

and Richman misled investors about the true information that the company had received from the

FDA. For example, defendants misled investors by falsely characterizing the 90-day extensio n

as merely part of a normal, continuing dialogue with the FDA about the pending BLA, when, i n

truth, it arose out of Biopure's submission to lift the clinical hold on the trauma IND . In

addition, defendants' optimistic statements about the 90-day extension misled investors becaus e

they were contrary to the express reasons for the extension given by the FDA staff. In answering

direct questions from analysts, defendants further misled investors by providing false information

about the true reason for the 90-day extension . Defendants further failed to disclose that th e

FDA had placed the trauma IND on clinical hold due to safety concerns and that the clinical hol d

was imposed based on the FDA's preliminary assessment of the BLA .

Biopure Continues to Conceal the Clinical Hold from Investor sin Periodic Reports and Offering Documents Filed with the Commission

56. On or about June 16, 2003, Biopure filed with the Commission a Form 10-Q

quarterly report for the quarter ended April 30, 2003 ("June 16 Form 10-Q") . The June 16 Form

10-Q was signed by defendant Moore, who certified that it did not "contain any untrue statement

of a material fact or omit to state a material fact necessary to make the statements made, in light

of the circumstances under which such statements were made, not misleading ." Defendant s

Moore and Kober substantially participated in drafting, reviewing and/or approving the non-

financial reporting sections of the June 16 Form 10-Q, and defendant Richman reviewe d

disclosures regarding the regulatory status of Biopure's FDA submissions .

57. On or about June 19, 2003, Biopure filed a Form S-3 registration statement an d

prospectus with the Commission and on or about July 2, 2003, Biopure filed a Pre-Effective

22

Amendment No. 1 for Form S-3 registration statement and prospectus with the Commission fo r

the sale of common stock and warrants for the purchase of common stock (collectively, th e

"Summer 2003 Shelf Registration") . On or about July 3, 2003, Biopure filed a Rule 424(b)(3 )

prospectus with the Commission for the sale of common stock and warrants for the purchase o f

common stock ("July 3 Prospectus")

58. Defendant Moore signed the Summer 2003 Shelf Registration. Defendants Moore

and Kober substantially participated in drafting, reviewing and/or approving the Summer 200 3

Shelf Registration and July 3 Prospectus, and defendant Richman reviewed disclosures regarding

the regulatory status of Biopure's FDA submissions .

59. In each of the June 16 Form 10-Q, Summer 2003 Shelf Registration , and July 3

Prospectus, Biopure made the following statements, among others :

We Cannot Expand Indications for Our Products Unless WeReceive FDA Approval for Each Proposed Indicatio n

The FDA requires a separate approval for each proposed indicationfor the use of Hemopure in the United States. We have applied for anindication for Hemopure that will only involve its perioperative use inpatients undergoing orthopedic surgery . Subsequently, we expect toexpand Hemopure's indications. To do so, we will have to designadditional clinical trials, submit the trial designs to the FDA for reviewand complete those trials successfully . . . .

60. Biopure's June 16 Form 10-Q, Summer 2003 Shelf Registration, and July 3

Prospectus were false and misleading because they misled investors about the true status o f

Biopure's clinical trials for the trauma indication. For example, the June 16 Form 10-Q, Summer

2003 Shelf Registration, and . July 3 Prospectus misled investors by failing to disclose that th e

FDA had barred Biopure from conducting clinical trials of Hemopure on trauma victims fo r

23

safety reasons . The June 16 Form 10-Q, Summer 2003 Shelf Registration, and July 3 Prospectu s

further misled investors by falsely stating that an indication involving Hemopure's perioperative

use in orthopedic surgery was the "only" indication applied for, when, in truth, Biopure had als o

sought permission to conduct trials for the trauma indication . The June 16 Form 10-Q, Summe r

2003 Shelf Registration, and July 3 Prospectus further misled investors by disclosing a futur e

"expectation" to expand Hemopure's indications, design additional trials and submit them to th e

FDA for review, when , in truth, Biopure already had designed additional clinical trials , submitted

the trial designs to the FDA for review, and received a clinical hold from the FDA .

Biopure Again Unsuccessfully Petitions the FDA to Lift theClinical Hold and Continues to Raise Money from Investors Withou t

Disclosing the Clinical Hold or the FDA's Serious Concerns Relating to its Pending BL A

61 . On or about July 2, 2003, Biopure made a submission to the FDA in response to

the FDA's May 30 letters in a further attempt to have the clinical hold lifted . Defendant

Richman prepared and signed this submission at defendant Moore's direction, and defendant

Moore received and reviewed it prior to submission to the FDA .

62. On or about July 17, 2003, Biopure filed a Form 8-K with the Commission ("July

17 Form 8-K") . Defendants Moore and Kober reviewed and approved the July 17 Form 8-K

prior to its filing .

63 . The July 17 Form 8-K attached as an exhibit a Placement Agency Agreement ,

dated July 17, 2003, between Biopure and ThinkEquity Partners, LLC pursuant to whic h

ThinkEquity Partners , LLC would act as exclusive placement agent for Biopure for the sale by

Biopure of up to $17,250,000 of shares of its class A common stock . Among the terms of th e

agreement that was disclosed in the July 17 Form 8-K was Biopure' s representation and warranty

24

that the company's registrations statements and prospectuses :

. . . conformed and will conform in all material respects to therequirements of the Exchange Act and the rules and regulations of theCommission promulgated thereunder, and none of such documentscontained or will contain at such time an untrue statement of a materialfact or omitted or will omit to state a material fact necessary to make thestatements therein, in the light of the circumstances under which they weremade, not misleading .

64. The July 17 Form 8-K was false and misleading to investors because, among othe r

things, the company's prior filings with the Commission contained untrue statements of materia l

fact or omitted to state material facts necessary to make the statements therein, in the light of th e

circumstances under which they were made, not misleading .

65 . On or about July 18, 2003, Biopure filed a Rule 424(b)(5) prospectus supplemen t

to the July 3 Prospectus for the sale of up to 3,083,000 shares of common stock to institutional

investors ("July 18 Offering Document") . The July 18 Offering Document incorporated by

reference certain of Biopure prior public filings, including prior offering documents and periodi c

reports . Defendants Moore and Kober substantially participated in drafting, reviewing and/o r

approving the July 18 Offering Document, and defendant Richman reviewed disclosures

regarding the regulatory status of Biopure's FDA submissions .

66. Biopure's July 18 Offering Document was false and misleading because, amon g

other things , it failed to disclose that the FDA had barred Biopure from conducting clinical trials

of Hemopure on trauma victims for safety reasons . The July 18 Offering Document further

misled investors by incorporating by reference prior public filings, discussed herein, that

contained false statements and omissions regarding the clinical hold imposed by the FDA based

on safety concerns arising from a preliminary assessment of Biopure's BLA .

25

The FDA Declines to Approve Hemopure, Issues aComplete Response Letter to the BLA and Refuses to Lift The Clinical Hol d

67. On July 30, 2003, Biopure received two letters from the FDA : a complete

response letter in which the FDA informed Biopure that its BLA was not approved, and a lette r

in which the FDA again declined to lift the clinical hold on the trauma IND .

68. From July 30, 2003 until December 11, 2003, in multiple public filings, pres s

releases and statements, defendants misled investors by failing to disclose that they had received

a complete response letter from the FDA, despite the fact that others, including FDA staff and

Biopure's own outside regulatory counsel, repeatedly and consistently identified the letter t o

defendants as a complete response letter . From July 30 until December 11, defendants furthe r

misled investors in multiple public filings, press releases and statements by misrepresenting th e

nature and scope of the deficiencies in the BLA raised by the FDA and by failing to disclose th e

continuing clinical hold on the trauma indication .

69. The July 30 complete response letter began by stating that :

The Center for Biologics Evaluation and Research (CBER) has completedthe review of all submissions made relating to your Biologics LicenseApplication . Our review finds that the information and data submitted areinadequate for final approval action at this time based on the deficienciesoutlined below .

70. The July 30 complete response le tter also summarized the deficiencies of

Biopure 's BLA in 34 single-spaced pages . In total, the letter contained more-than 220

deficiencies and questions regarding Biopure's clinical trials, its data and the safety and efficac y

of Hemopure . Chief among these were questions about the conduct of Biopure's clinical trial s

and the integrity of its data, in particular whether controls were sufficient to ensure that the dat a

26

in Biopure's BLA submission was accurate and reliable enough to form the basis for conclusion s

about safety and efficacy, and about why Biopure failed to perform certain analyses as the FD A

had expected and recommended . The FDA further expressly reserved its right to re-evaluat e

safety and efficacy data pending resolution, if possible, of data integrity issues . The complete

response letter stated that the review clock was suspended with its issuance .

71 . In the FDA's other July 30 letter, the FDA again refused to lift the clinical hold o n

the trauma IND "because human subjects are or would be exposed to an unreasonable an d

significant risk of illness or injury." In support of that conclusion, the FDA cited many of the

same deficiencies and questions raised in its complete response le tter to Biopure 's BLA. As in

the complete response letter, the clinical hold letter also questioned the controls of the clinica l

trials and the analysis of the resulting data, and raised concerns about the safety of Hemopure .

72 . Defendants Moore, Richman, and Kober each received a copy of the July 3 0

complete response letter on or about July 30, 2003 . Defendants Moore and Richman receive d

copies of the July 30 clinical hold letter on or about July 30, 2003, and defendant Kober was

made aware of the letter and its contents in discussions with other Biopure management no late r

than July 31, 2003 .

73 . Given the length , detail and substance of the deficiencies identified by the FDA,

the July 30 complete response letter and the July 30 clinical hold letter were a major setback i n

Biopure's effort to gain FDA approval for Hemopure . This was especially so because as of Jul y

30, 2003, Biopure had made two substantial submissions to the FDA seeking to lift the clinical

hold, but had been unable to adequately address the FDA's concerns .

27

74 . On or about the morning of July 31 , 2003 , defendant Richman telephoned a

member of the FDA staff working on Biopure's BLA and trauma IND applications to discus s

Biopure's next step after receipt of the complete response letter. The FDA staff member

identified the letter as a complete response letter and told defendant Richman that within 10 day s

of its receipt, Biopure should take one of the following actions: amend the application ; notify th e

FDA of its intent to amend the application; withdraw the application; or request a hearing .

Defendant Richman asked whether because the complete response letter was issued 30 day s

before the due date, if Biopure were able to respond to the complete response letter within the 3 0

days , would it receive approval . The FDA staff member responded that with the issuance of a

complete response letter, the review clock had stopped and no further review would b e

considered until Biopure responded to all deficiencies listed in the letter . The FDA staff member

further told defendant Richman that a partial response would not be considered for review, a

response to all listed deficiencies was required in order to re-sta rt the clock. The FDA staff

member further told defendant Richman that once the FDA received Biopure's response to th e

complete response letter, the agency gets a new review cycle of six months to review thos e

responses .

75. On or about July 31, 2003, Biopure, acting through defendant Kober, contacted

outside counsel that specialized in FDA regulatory matters concerning the complete respons e

letter and a draft of a press release that the company intended to issue . The draft press release

stated that Biopure had received a letter from the FDA, but did not identify it as a complete

response letter. Biopure's outside counsel orally advised defendant Kober that he "didn't have

time to read letter but looked like complete response ." Outside counsel further advised

28

defendant Kober that a draft release disclosing receipt of the letter looked "unduly optimistic . "

Outside counsel further advised defendant Kober that issuance of the letter "30 days early in thi s

context while true isn't great cause optimism [sic] ." Defendant Kober informed defendant s

Moore and Richman of the substance of outside counsel's comments .

Biopure Misleads Investors About the July 30 Letters

76. On August 1, 2003, Biopure issued a press release ("August 1 Press Release") an d

included the text of the release in a Form 8-K filed with the Commission ("August 1 Form 8-K") .

Defendants Moore, Richman, and Kober each substantially participated in drafting, reviewin g

and/or approving the August 1 Press Release .

77. The August 1 Press Release stated, among other things :

Biopure Corporation (Nasdaq : BPUR) announced today that the U.S. Foodand Drug Administration (FDA) has completed its review of thecompany's biologic license application (BLA) for Hemopure(R)[hemoglobin glutamer - 250 (bovine)] and issued a letter requestingadditional information. The letter focuses primarily on clarification ofclinical and preclinical data and includes some comments on labeling . Itdoes not request additional clinical trials . Biopure has applied to marketHemopure in the United States for the treatment of acutely anemic adultpatients undergoing orthopedic surgery and for the elimination orreduction of red blood cell transfusions in these patients .

With 30 days remaining in the original BLA review cycle , the issuance ofthe letter has suspended the FDA review clock until Biopure submits acomplete response.

"We're encouraged that the FDA has finished its review and providedcomprehensive feedback in advance of the formal action due date . Bymaintaining thirty days on the review clock, the FDA is encouraging us towork with them to complete the approval process as quickly as possible,"said Biopure President and CEO Thomas A. Moore. "We'll work with theAgency to address the remaining questions and will provide our answersas expeditiously as possible ."

29

78 . After the August 1 Press Release was issued on the morning of August 1, 2003 ,

Biopure's stock price rose 22 .27%, from a closing price of $5 .97 on July 31, 2003 to a closing

price of $7.30 on August 1, 2003 .

79. Biopure's August 1 Press Release was false and misleading because it misle d

investors about the true information that the company had received from the FDA . For example ,

the August 1 Press Release failed to disclose that Biopure had received a complete response lette r

from the FDA. In addition, the August 1 Press Release was misleadingly optimistic despite th e

fact that Biopure had received two detailed letters from the FDA that constituted a major setback

in its effort to gain FDA approval for Hemopure . Defendants Moore' s statement in the August 1

Press Release that the FDA was "encouraging" Biopure to "complete the approval process as

quickly as possible" further misled investors because it had no basis in fact and was inconsistent

with the seriousness and number of deficiencies identified by the FDA and the amount of time i t

would take Biopure to respond. References in the August 1 Press Release to 30 days remainin g

in the review cycle further misled investors about the amount of time that the FDA would have to

respond -- six months -- once Biopure responded to all deficiencies in the letter . The. August 1

Press Release further misled investors by stating that the FDA had not requested additiona l

clinical trials when, in truth , the FDA was questioning the integrity of Biopure 's data, a

preliminary step prior to determination of whether new trials would be necessary and was furthe r

refusing to lift the hold barring clinical trials on trauma victims . The August 1 Press Release

further failed to disclose anything about the clinical hold, including that the FDA had imposed

one, that Biopure had received a lengthy and detailed letter refusing to lift the clinical hold whic h

identified many of the same deficiencies and raised many of the same questions as the complete

30

response letter, or that Biopure had twice unsuccessfully a ttempted to persuade the FDA to lift

the clinical hold .

80. On or about August 5, 2003, defendant Kober sent an e-mail to outside counsel

specializing in FDA regulatory matter to request assistance with developing a strategy fo r

responding to the FDA' s complete response le tter. In a response sent that same day , Biopure' s

outside counsel sent an e-mail to defendant Kober that identified the July 30 letter as a complet e

response letter.

Biopure Continues To Misrepresent the Complete Response Letterand To Conceal the Existence of the Clinical Hol d

81 . On August 21, 2003, Biopure issued a press release announcing its financia l

results for the 3rd quarter of fiscal year 2003 ("August 21 Press Release") and included the text

of the press release in a Form 8-K filed with the Commission, dated September 15, 200 3

("September 15 Form 8-K") . Defendants Moore, Richman, and Kober each participated in

drafting, reviewing and/or approving the August 21 Press Release .

82. The August 21 Press Release stated , among other things :

On July 30th, the FDA sent Biopure a letter stating that the agency hascompleted its review of the company's BLA to market Hemopure in theUnited States for the treatment of acutely anemic adult patients undergoingorthopedic surgery and for the elimination or reduction of red blood celltransfusions in these patients . The letter requests additional informationand suspends the BLA review clock with 30 days remaining in the originalreview cycle . It does not request additional clinical trials . Biopure ispreparing its response, which, when submitted, will restart the reviewclock.

83 . Biopure's August 21 Press Release was false and misleading because it misled

investors about the true information that the company had received from the FDA. For example,

31

the August 21 Press Release failed to disclose that Biopure had received a complete response

letter from the FDA. References in the August 21 Press Release to 30 days remaining in th e

review cycle further misled investors about the amount of time that the FDA would have t o

respond -- six months -- once Biopure responded to all deficiencies in the letter. The August 2 1

Press Release further misled investors by stating that the FDA had not requested additional

clinical trials when, in truth, the FDA was questioning the integrity of Biopure' s data, a

preliminary step prior to determination of whether new trials would be necessary and was further

refusing to lift the hold barring clinical trials on trauma victims . The August 21 Press Release

further failed to disclose anything about the clinical hold, including that the FDA had impose d

one, that Biopure had received a lengthy and detailed letter refusing to lift the clinical hold whic h

identified many of the same deficiencies and raised many of the same questions as the complete

response letter, or that Biopure had twice unsuccessfully a ttempted to persuade the FDA to lift

the clinical hold .

84. That same day, August 21, 2003, defendants Moore and Richman participated in a

conference call with investors and analysts ("August 21 Investor Call") . During the August 2 1

Investor Call, defendant Moore stated, among other things :

The agency has done us a big favor by providing what amounts to acomplete detailed response and set of questions to Biopure prior to the endof the review cycle, and then stopping the review clock with 30 daysremaining in the PDUFA cycle. They have thereby made a commitment togive us an action letter 30 days after we provide our response to theirquestions . They could just as easily have announced an end to the reviewcycle with their response, in which case they would have had two to sixmonths to respond to our answers instead of the 30 day period .

32

Our efforts to date suggest that we're in good shape so far to be able toanswer FDA's questions .

85 . During the August 21 Investor Call, defendants Moore and Richman engaged i n

colloquies with a stock analyst who participated in the call :

Analyst 1 : . . . A couple of questions on the letter from the FDA. You usedthe term complete response a couple of times . But, this isn't acomplete response letter. What is it exactly?

Moore : It's, and I'll ask Howard Richman to comment on this in just a second . It is -- Ithink Howard will call it a hybrid, and by that I mean it genuinely represents allthe questions that FDA would like to have us answer, and so in that sense it's likea complete response . But normally a complete response letter brings an end to thereview cycle . And the agency has elected not to do that, offering us this preciousopportunity to get a response 30 days after we submit the answers to thosequestions . And so, that's what it is .

Analyst 1 : It sounds like the response is going to take some time . Can you tell me about howmany questions are involved? And the followup question is, depending on thelength of your response, is it reasonable to expect that the FDA is going to be ableto respond back within that 30 day timeline? If you give them a very exhaustivedetailed response back, as I know you will, isn't it going to take the FDA longerthan 30 days to respond back ?

Moore: I think that's a very fair question, and that's one of the motivations we have forhaving a meeting with FDA simply so we can agree on how we're going to orderthis data and maybe how we can share some of the data as we go so that it makesit easier for them to meet that guideline .

Richman: I'll share this with yourself and for the other people listening . This type of letteris very unique. As Tom clearly stated for everyone, it is a hybrid, it's somethingthat was done from the (indiscernible) perspective to work with Biopure in thisaspect because you're right in stating that people have (indiscernible), this doesnot follow the area that we've seen where you look on FDA sites or in othercomplete responses . This was done with the specific intent to work with us . Withthat being said, it counts in such a way that they want us to be able to get back tothem vis-a-vis this meeting and in our answers . Many of our answers will not bethat detailed in response, some are in clarification, which will only meet the FDAwith some points we're going to discuss with them . Other ones will just providethem information they requested in terms of clarification and follow-up sourcedocuments and other information they've asked about. So, when you say about a

33

detailed (indiscernible) response, in many ways it will not be . But it's also clearthat the format that they have for us with FDA which will be clarified on ameeting in September will clearly enlighten us and them and give a clear pathwayto the response in a correct time frame .

Analyst 2 : . . . My question is, what will you do if Biopure doesn't get FDA approval?

Moore : . . . While we are continuing to be cautiously optimistic, we're on the approvaltrack. If you ask us to specifically address this question, which you have, I guesswhat I'd say is the FDA doesn't really just say no . At least not in a situation likethis where an application has been accepted and taken this far down the reviewtrack. What the FDA says is here's what you've got to do, guys, if you want topersuade us to say yes . And generally what they'd say is you need moreinformation. I'm going to take a big leap here, Howard [Richman] may hit me .But if the information we've given them so far led them to say we can't approve itthen they would've already said we can't approve it . Okay? You don't go backand forth like this because the product is not approvable . The question for theagency is the process of putting together the adequacy of the total data set .

Analyst 3 : Is there anything on the work the trials that the military is doing in trauma yet ?

Moore: We've not initiated human clinical trials in trauma with the military or for thatmatter on the civilian side as yet . So, we hope to get started on that ASAP . Ithink probably those trials will begin, however, at least after we have -- no soonerthan after we filed our responses with FDA on the BLA questions. As Imentioned earlier in my flurry of discussions about meetings, Naval medicalresearch has been very active in doing preclinical work on trauma with ourproduct, and then sharing those results in several different forms actually . So,work is going on very actively on the trauma side, but I don't believe human trialswill begin until after we have completed our answers to the BLA. Part of this isrelated to the fact that we already are engaged in FDA in a dialogue on a totalclinical development program in trauma with FDA. And so we expect the finaldiscussion on that with FDA will ensue after we've addressed the questionsthey've asked for us on the use in anemia from surgery indication .

86. Biopure's August 21 Investor Call was false and misleading because defendants

misled investors about the true information that the company had received from the FDA . For

34

example, defendants misled investors by falsely characterizing the July 30 letter- as a "hybrid "

letter, when, in truth, it was a "complete response letter," and that fact had been confirmed by the

FDA to defendant Richman at least two times by August 21, 2003 . Defendants further misled

investors by falsely stating that the FDA would have 30 days to review a submission fro m

Biopure, when, in truth, the agency would have six months to review a submission once Biopur e

had addressed all deficiencies in the complete response letter . Defendant Moore's statement s

that the FDA did a "big favor" for Biopure and had "made a commitment to give us an action

letter 30 days after we provide our response to their questions" further misled investors because ,

among, other things, these statements had no basis in fact, were inconsistent with statement s

made by the FDA to Biopure and were contrary to the six month period the FDA would have to

review a resubmission . Defendants further misled investors by stating that the company was "i n

good shape" to address the deficiencies and questions in the complete response letter, when, i n

truth, the deficiencies and questions were of such a substantial nature that Biopure would not be

able to respond to them for years . Defendants further misled investors in the August 21 Investo r

Call by making optimistic statements about the likelihood of FDA approval, when, in truth, the

deficiencies and questions in the two July 30 letters from the FDA, as well as concerns discusse d

by the FDA during telephone calls, were major obstacles to obtaining FDA approval . Defendants

further misled investors during the August 21 Investor Call by discussing clinical trials of a

trauma indication but concealing from investors that the FDA had barred Biopure from

conducting clinical trials on trauma victims for safety reasons .

87. On or about August 22, 2003, Biopure filed a Form S-3 registration statement and

prospectus with the Commission for the sale of common stock and warrants for the purchase of

35

common stock by selling security holders ("August Secondary Offering Documents") .

Defendant Moore signed the August Secondary Offering Documents . Defendants Moore and

Kober substantially participated in drafting, reviewing and/or approving the August Secondar y

Offering Documents, and defendant Richman reviewed disclosures regarding the regulator y

status of Biopure's FDA submissions .

88 . In the August Secondary Offering Documents, Biopure did not state that the July

30 letter it had received from the FDA was a complete response letter . In addition, Biopure made

the following statement, among others :

We Cannot Expand Indications for Our Products Unless We Receive FDAApproval for Each Proposed Indicatio n

The FDA requires a separate approval for each proposed indicationfor the use of Hemopure in the United States . We have applied for anindication for Hemopure that will only involve its perioperative use inpatients undergoing orthopedic surgery. Subsequently, we expect toexpand Hemopure's indications. To do so, we will have to designadditional clinical trials, submit the trial designs to the FDA for reviewand complete those trials successfully . . . .

89. Biopure's August Secondary Offering Documents were false and misleadin g

because they misled investors about the true information that the company had received from th e

FDA. For example, Biopure 's August Secondary Offering Documents failed to disclose, amon g

other things, that the July 30 letter from the FDA was a complete response letter . The August

Secondary Offering Documents further misled investors by failing to disclose that the FDA ha d

barred Biopure from conducting clinical trials of Hemopure on trauma victims for safety reason s

and that Biopure had twice unsuccessfully petitioned the FDA to lift the hold . The August

Secondary Offering Documents further misled investors by falsely stating that an indication

36

involving Hemopure's perioperative use in orthopedic surgery was the "only" indication applie d

for, when, in truth, Biopure had also sought permission to conduct trials for the traum a

indication. The August Secondary Offering Documents further misled investors by disclosing a

future "expectation" to expand Hemopure's indications, design additional trials and submit the m

to the FDA for review, when, in truth, Biopure already had designed additional clinical trials ,

submitted the trial designs to the FDA for review, an d received a clinical hold from the FDA .

Biopure 's Outside Counsel Confirms th eJuly 30 Letter was a Complete Response Letter and

a Six Month Review Period Would Apply to a Resubmission

90. On or about August 26, 2003 , acting at the request of Biopure management ,

Biopure 's outside counsel contacted FDA staff to determine whether the FDA planned to issue a

second response letter by August 29 . Following that conversation , Biopure 's outside counse l

informed defendants Moore, Richman and Kober in e-mails and discussions that despite the use

of some non-standard language and the issuance of the letter 30 days prior to the due date, th e

July 30 letter that Biopure received was a complete response letter for the BLA . Biopure' s

outside counsel further confirmed to defendants Moore, Richman and Kober that the revie w

cycle had been completed without approval by the FDA and that the FDA would have six months

to review any resubmission from Biopure .

Biopure Continues To Misrepresent the Complete Response Letter andTo Conceal the Existence of the Clinical Hold While Raising Money from

Investors, Making Public Statements and Filing Periodic Reports with the Commission

91 . On September 12, 2003, Biopure filed a Form 424(b)(3) prospectus ("September

12 Prospectus") with the Commission . In the "Risk Factors" section of the September 1 2

Prospectus, Biopure stated that the July 30 FDA letter was a complete response letter.

37

92. On September 15, 2003, the following trading day, Biopure's stock price dropped

by 6.5% on heavy trading . When asked about this trading activity, Biopure's Director o f

Corporate Communications attributed the stock movement to the disclosure that Biopure ha d

received a complete response letter . In e-mail messages to investors, the Director of Corporate

Communications stated that the reference to the letter as a "complete response letter" had been a

"mistake" by a "junior lawyer at a law firm" used by the company .

93. On September 15, 2003, Biopure filed an amended Form 424(b)(3) prospectus

("September 15 Prospectus") with the Commission . The September 15 Prospectus omitted the

reference to the July 30 letter as a "complete response letter ." Defendants Moore and Kober

substantially participated in drafting, reviewing and/or approving the September 15 Prospectus ,

and defendant Richman reviewed disclosures regarding the regulatory status of Biopure's FDA

submissions .

94. Also on or about September 15, 2003, Biopure filed with the Commission a Form

10-Q quarterly report for the quarter ended July 31, 2003 ("September 15 Form 10-Q") .

95 . The September 15 Form 10-Q was signed by defendant Moore, who certified tha t

it did not "contain any untrue statement of a material fact or omit to state a material fac t

necessary to make the statements made, in light of the circumstances under which suc h

statements were made, not misleading ." Defendants Moore and Kober substantially participate d

in drafting, reviewing and/or approving, and defendant Richman reviewed, the non-financial

reporting sections of the September 15 Form 10-Q .

96. In the September 15 Form 10-Q, Biopure did not state that the July 30 letter it ha d

received from the FDA was a complete response letter . In addition, Biopure made the following

38

statement, among others :

We Cannot Expand Indications for Our Products Unless We Receive FDAApproval for Each Proposed Indication

The FDA requires a separate approval for each proposed indicationfor the use of Hemopure in the United States . We have applied for anindication for Hemopure that will only involve its perioperative use inpatients undergoing orthopedic surgery. Subsequently, we expect toexpand Hemopure's indications. To do so, we will have to designadditional clinical trials, submit the trial designs to the FDA for reviewand complete those trials successfully . . . .

We also plan to develop Hemopure for potential use in trauma and othermedical applications .

97. Biopure's September 15 Form 10-Q was false and misleading because it misled

investors about the true information that the company had received from the FDA. For example,

Biopure's September 15 Form 10-Q failed to disclose, among other things, that the July 30 lette r

from the FDA was a complete response letter . The September 15 Form 10-Q was further false

and misleading because it failed to disclose that the FDA had barred Biopure from conductin g

clinical trials of Hemopure on trauma victims for safety reasons . The September 15 Form 10-Q

further misled investors by falsely stating that an indication involving Hemopure's perioperativ e

use in orthopedic surgery was the "only" indication applied for, when, in truth, Biopure had als o

sought permission to conduct trials for the trauma indication . The September 15 Form 10-Q

further misled investors by disclosing a future "expectation" to expand Hemopure's indications,

design additional trials and submit them to the FDA for review, when, in truth, Biopure alread y

had designed additional clinical trials, submi tted the trial designs to the FDA for review, and

received a clinical hold from the FDA. The September 10 Form 10-Q further misled investors by

39

referring to development plans for the trauma indication without disclosing that the FDA place d

the trauma indication on clinical hold for safety reasons arising out of the same data submitted i n

support of Biopure's BLA .

98. On October 30, 2003, Biopure issued another press release ("October 30 Pres s

Release") and included the text of the release in a Form 8-K filed with the Commission

("October 30 Form 8-K") . Defendants Moore and Kober each substantially participated i n

drafting, reviewing and/or approving the October 30 Press Release .

99. The October 30 Press Release announced that defendant Richman, who had bee n

terminated, had left Biopure . The October 30 Press Release further stated, among other things :

Biopure Corporation (Nasdaq : BPUR) today announced its plan to respondby June 30, 2004, to the Food and Drug Administration's (FDA) questionsregarding its biologic license application (BLA) for Hemopure(R)[hemoglobin glutamer - 250 (bovine)] . The company has adjusted itsoperating plan to reduce expenses and conserve cash while it completes itswritten response to the FDA .

Biopure applied for FDA approval to market the company's oxygentherapeutic, Hemopure, in the United States for the treatment of acutelyanemic adult patients undergoing orthopedic surgery and for theelimination or reduction of red blood cell transfusions in these patients .

During the past two months the company has had several substantiveinteractions with the FDA to clarify the Agency's questions . Many ofBiopure's responses have been completed . However, some require theretrieval of source medical documents and/or historical blood transfusiondata from clinical trial sites in various countries, which will take severa l

months to complete .

"In the best interests of our shareholders, today we've taken the stepsnecessary to more efficiently run our business while we complete ourcomprehensive response to all of the FDA's questions," said BiopurePresident and CEO Thomas A . Moore. "We view the Agency's question s

40

as a `roadmap' to approval and have set a conservative, achievable targetdate for our response. We remain enthusiastically committed tocommercializing Hemopure in the United States as expeditiously aspossible."

100. The October 30 Press Release was false and misleading because it misle d

investors about the true status of Biopure's continued efforts to seek FDA approval fo r

Hemopure. For example, in the October 30 Press Release, defendants continued to conceal from

investors that the July 30 letter was a complete response letter. The October 30 Press Releas e

was further misleading to investors because Biopure failed to disclose to investors that th e

June 30, 2004 planned response date was dependent upon Biopure pursuing a much narrowe r

indication than in the original BLA . Indeed, prior to issuance of the October 30 Press Release ,

Biopure ignored advice from the company's outside counsel, who after reviewing a draft of th e

release recommended that company disclose that, "[i]n its planned response to FDA, Biopure

intends to narrow its focus and seek approval only for anemia in those surgical settings wher e

blood transfusion is not an option ." The October 30 Press Release was further misleading to

investors because the clinical hold on the trauma IND remained undisclosed .

101 . Even though the October 30 Press Release misled investors by containing fals e

statements and failing to disclose material facts, the market reacted to the negative -- albei t

incomplete -- news that was contained in the release, including that defendant Richman had left

the company and that it would take eight additional months to response to the complete respons e

letter. On October 30, 2003, on heavy trading volume, Biopure's stock price closed at $3 .68, a

39% decrease from the prior day's closing price of $6.05 .

41

Biopure Discloses the Complete Response Letter and the Clinical Hol d

102. On or about December 11, 2003, Biopure issued a press release ("December 1 1

Press Release") announcing its financial results for the fiscal year ending October 31, 2003 an d

included the text of the release in a Form 8-K filed with the Commission ("December 11 Form 8-

K"). In the December 11 Press Release, Biopure disclosed for the first time -- and more tha n

four months after it was issued -- that the July 30 letter from the FDA was a complete respons e

letter. The December I 1 Press Release, however, did not disclose the clinical hold on the traum a

trials .

103. Defendants Moore, Richman, and Kober each substantially participated i n

drafting, reviewing and/or approving the December 11 Press Release .

104. On Christmas Eve, December 24, 2003, after the close of the stock markets ,

Biopure issued a press release ("December 24 Press Release") and included the text of the release

on a Form 8-K filed with the Commission ("December 24 Form 8-K") . In the December 24,

2003 Press Release, Biopure publicly revealed for the first time the trauma clinical hold impose d

by the FDA more than eight months earlier . Biopure also disclosed that the company had

received a "Wells Notice" that the Commission staff had made a preliminary determination t o

recommend filing a civil injunctive action against the company . On the next trading day,

December 26, 2003, Biopure's stock price closed down 13 .83% at $2.43 . On Monday ,

December 29, 2003, the first trading day after the Christmas holiday weekend, Biopure's stoc k

closed at $2.33, which represented a 17.3 8% decrease from the closing price on December 24 ,

2003 .

42

Biopure Raised a Significant Amount of Capital from Investors

105 . While defendants were engaged in the fraudulent scheme described herein ,

Biopure raised a significant amount of capital in connection with the several offerings of stoc k

during the relevant period . For example, on April 16, 2003, Biopure realized $3,032,000 in net

proceeds from sale of shares and warrants . On May 2, 2003 and May 6, 2003, Biopure realized

$3,134,000 and $2,935,000, respectively, in net proceeds from sales of shares and warrants . On

July 23, 2003, Biopure realized $ 16,138,000 in net proceeds from the sale of 3,083 ,000 shares of

common stock . Biopure also had sales of $10,000,000 of common stock issued from time t o

time through the standby equity distribution agreement with CMI . Biopure also received $3.2

million in net proceeds from the exercise of warrants to purchase 712,141 shares of its commo n

stock at an average exercise price of $4 .52 per share during the fiscal year ended October 31 ,

2003 .

Remedies

106. The violations set forth in this Complaint involve fraud, deceit, manipulation, or

deliberate or reckless disregard of a regulatory requirement and such violations directly or

indirectly resulted in substantial losses or created a significant risk of substantial losses to othe r

persons.

FIRST CLAIM

(Violation of Exchange Act Section 10(b) andExchange Act Rule I Ob-5 Against All Defendants )

107. The Commission repeats and incorporates by reference the allegations in

paragraphs 1- .106 of the Complaint as if set forth fully herein .

43

108. As set forth more fully herein, each of defendants, directly or indirectly, by use o f

the means or instruments of interstate commerce, or of the mails, or of a facility of a nationa l

securities exchange, knowingly or recklessly (a) employed devices, schemes and artifices t o

defraud; (b) made untrue statements of material fact or omitted to state material facts necessar y

in order to make the statements made, in light of the circumstances under which they were made ,

not misleading; and (c) engaged in acts, transactions, practices, and courses of business whic h

operated or would operate as a fraud or deceit upon the purchasers of securities and upon othe r

persons, in connection with the purchase or sale of a security .

109. In connection with the acts and omissions described herein, each of defendants ,

acted knowingly or recklessly . Each knew, or was reckless in not knowing, that one of more o f

the April Offering Documents , May Prospectus Supplements , May 14 Form 8-K, May 22 Form

8-K, June 16 Form 10-Q, Summer 2003 Shelf Registration, July 3 Prospectus, July 18 Offerin g

Document, July 17 Form 8-K, August 1 Form 8-K, August Secondary Offering Documents,

September 15 Form.S-K, September 15 Prospectus, September 15 Form 10-Q, and October 3 0

Form 8-K (collectively, "Biopure's SEC Filings") and May 22 Press Release, May 22 Investor

Call, May 30 Press Release , May 30 Investor Call, August 1 Press Release , August 21 Pres s

Release, August 21 Investor Call, October 30 Press Release, and December 11 Press Releas e

(collectively, "Biopure's Public Statements") employed devices, schemes and artifices t o

defraud, contained material misstatements and omissions, or operated or would operate as a fraud

or deceit in connection with the purchasers or sale of a security .

110. By reason of the foregoing, each of defendants violated Section 10(b) of the

Exchange Act and Exchange Act Rule I Ob-5 .

44

SECOND CLAIM

(Violation of Securities Act Section 17(a) Against All Defendants )

111 . The Commission repeats and incorporates by reference the allegations in

paragraphs 1-106 of the Complaint as if set forth fully herein .

112. As set forth more fully herein , each of defendants in the offer or sale of securities,

by the use of means or instruments of transportation or communication in interstate commerce, o r

by the use of the mails, directly or indirectly: (a) employed devices, schemes or artifices to

defraud; (b) obtained money or property by means of untrue statements of material facts o r

omissions to state material facts necessary in order to make the statements made, in the light o f

the circumstances under which they were made, not misleading ; or (c) engaged in transactions ,

practices or courses of business which operated or would operate as a fraud or deceit upo n

purchasers of securities .

113 . In connection with the acts and omissions described herein, each of defendants

acted knowingly, recklessly, or negligently . Each knew, or was reckless in not knowing, or

should have known, that one or more of Biopure's SEC Filings and Biopure's Public Statement s

employed devices, schemes or artifices to defraud, contained material misstatements an d

omissions, or operated or would operate as a fraud or deceit upon purchasers of securities .

114. By reason of the foregoing, each of defendants violated Section 17(a) of the

Securities Act.

45

THIRD CLAIM

(Violation of Exchange Act Section 13(a) an dExchange Act Rules 12b-20, 13 a-11 and 13 a-13 Against Defendant Biopure )

115 . The Commission repeats and incorporates by reference the allegations i n


116. Section 13(a) of the Exchange Act and Rules 13a-11 and 13a-13 thereunde r

require issuers of registered securities to file with the Commission factually accurate current and

quarterly reports . Exchange Act Rule 12b-20 provides that in addition to the information

expressly required to be included in a statement or report, there shall be added such further

material information, if any, as may be necessary to make the required statements, in the light o f

the circumstances under which they are made, not misleading .

117. As a result of the conduct set forth herein, Biopure violated Section 13(a) of th e

Exchange Act and Rules 12b-20, 13a-11 and 13a-13 thereunder .

FOURTH CLAIM

(Aiding and Abetting Biopure's Violations o fExchange Act Section 13(a) and Exchange Act Rules 12b-20, 13a-11 and 13a-13

Against Defendants Moore, Richman, and Kober)

118 . The Commission repeats and incorporates by reference the allegations i n


119. Section 13(a) of the Exchange Act and Rules 13a-11 and 13a-13 thereunde r

require issuers of registered securities to file with the Commission factually accurate current and

quarterly reports . Exchange Act Rule 12b-20 provides that in addition to the information

expressly required to be included in a statement or report, there shall be added such further

46

material information, if any, as may be necessary to make the required statements, in the light o f

the circumstances under which they are made, not misleading .

120. As set forth herein, one or more of Biopure 's SEC Filings fr audulently misled

investors about the truth regarding Biopure's efforts to gain FDA approval of Hemopure i n

connection with the company's trauma IND and its BLA in violation of Section 13(a) of th e

Exchange Act and Rules 12b-20, 13a-11, and 13a-13 thereunder .

121 . By knowingly rendering substantial assistance to one or more of Biopure' s

violations, each of defendants Moore, Richman, and Kober aided and abetted Biopure' s

violations of Section 13(a) of the Exchange Act, and Rules 12b-20, 13a-11, and 13a-1 3

thereunder .

FIFTH CLAIM

(Violation of Exchange Act Rule 13a-14 Against Defendant Moore )

122. The Commission repeats and incorporates by reference the allegations i n


123. Section 13(a) of the Exchange Act [15 U . S .C. § 78m(a)] requires that current and

periodic reports filed with the Commission do not contain untrue statements of material fact o r

omit to state material facts necessary to make the statements made, in light of the circumstances

in which they were made, not misleading . Rule 13a-14 thereunder [17 C .F.R. 240.13a-14] ,

requires the principal executive officer and principal financial officer of the company to sign a

certification that the report does not contain any untrue statement of material fact or omit to stat e

a material fact necessary to make the statements made, in light of the circumstances in which

such statements were made, not misleading .

47

124. By reason of the foregoing, defendant Moore violated Exchange Act Rule 13a-1 4

[17 C.F .R . 240.13a-14] in cert ifying each of Biopure's June 16 Form 10-Q and September 1 5

Form 10-Q .

PRAYER FOR RELIEF

WHEREFORE, the Commission respectfully requests that this Court :

1 .

Issue a Final Judgment of Permanent Injunction permanently restraining and enjoining

each of defendants Biopure, Moore, Richman, and Kober and their officers, agents , servants ,

employees, and attorneys, and all persons in active concert or participation, and each of the m

who receive actual notice of the Final Judgement by personal service or otherwise, from violatin g

or aiding and abetting violations of Section 17(a) of the Securities Act [15 U .S.C. § 77q(a)] ,

Sections 10(b) and 13(a) of the Exchange Act [15 U . S .C. §§ 78j (b) and 78m (a)] and Rules 1Ob-5 ,

12b-20, 13a-11 and 13a-13 promulgated thereunder [17 C.F.R §§ 240 .10b-5, 240 .12b-20 ,

240.13a-11 and 240 .13a-13], and, as to defendant Moore only, Rule 13a-14 thereunder [1 7

C.F.R. § 240.13a-14] .

II .

Issue an Order requiring each of defendants Biopure, Moore, Richman, and Kober to pay

a civil penalty in an appropriate amount pursuant to Section 20(d) of the Securities Act an d

Section 21(d)(3) [15 U.S .C. §§ 77t(d) and 78u(d)(3)] .

III .

Issue an Order barring defendants Moore, Richman, and Kober from serving as officers or

directors of any publicly-traded issuer pursuant to Section 20(e) of the Securities Act and Sectio n

48

21(d)(2) of the Exchange Act [15 U .S.C. §§ 77t(e) and 78u(d)(2)] .

IV.

Grant such other relief as this Court deems just and appropriate under the circumstances .

Respectfully submitted,

By: 4.,.Ian . Roffman ( ss. Bar No . 637564)El en Bob 6r Mo i an (Mass . Bar No. 567598)ATTORNEYS FOR PLAINTIF FSECURITIES AND EXCHANGE COMMISSION73 Tremont Street, 6th FloorBoston, Massachusetts 02108(617) 573-8900, ext. 8987 (Roffman)

Dated: September 14, 2005

49

Exhibit B



07/30/03 WED 16 : 31 FAX 9 301 827 3524 CBER /OBRR/DBA J001

DEPARTMENT OF HEALTH & . HUMAN SERVICES

Food end Drug Administration1401 RoalMife PikeRookvpie MD 20852-144 8

Jul, 3 0 2003Our Reference STN: 125066/0

Howard P. Richman , D.P.M.Biopure Corporation11 Hurley StreetCambridge, Massachusetts 0214 1

Dear Dr. Richman :

This letter is in regard to your Biologics License Application (BLA) for Hemoglobin Glutamer-250 (Bovine), also known as HBOC-201 submitted under section 351 of the Public HealthService Act.

The Center for Biologics Evaluation and Research (CBER) has completed the review of allsubmissions made relating to your Biologics License Application . Our review finds that theinformation and data submitted are inadequate for final approval action at this time based on thedeficiencies outlined below.

The deficiencies may be summarized as follows :

Mpnito r,~ing of studyHEM-11115

Bioreeearch Monitoring Inspections :

FDA inspections of fourteen clinical investigator sites at which subjects had beenenrolled and treated under the HEM-0115 clinical study revealed that in addition tointernal monitors, Biopure had engaged the services of several contract researchorganizations (CROs) and private consultants who conducted multiple monitoring visitsat these clinical sites . It was also noted that these CROs and private consultants weremonitoring the same sites during the same study period concurrently with internalBiopure monitors.

Please provide a detailed list of .

a. All CROs and private consultants used to monitor the HEM-0115 study .

b . The site(s) and time period(s) during which the internal Biopure monitors, CROs andprivate consultants performed specific monitoring activities .

c. The specific obligations and responsibilities for the monitoring of clinicalinvestigators performed by internal Biopure monitors, each CRO, and each private

Confidential TreateentRequested by Biopure

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consultant including , but not limited to: completing and mating changes to the casereport forms (CRFs), the handling of data clari fication requests, and the reporting ofserious adverse events (SAEs) and adverse events (AEs) .

2. FDA's November 1999 inspection of Biopure revealed there was no documentation tosubstantiate that the firm' s internal Monitors . CROs, and private consultants were trainedas required by Biopure SOP CN-0029 . The external contract monitors ' trainingdocumentation forms (QA-0078 ) were found to be incomplete , and did not identify theSOPs reviewed or the trainer . There was also no documentation to ensure that externalcontract monitors were lmowledgeable and proficient in current Biopure SOPs .

a. Please provide a detailed explanation as to how Biopure ensured the consistencyof the monitoring activi ties performed by the internal Biopure monitors , the CROsand the private consultants who were monitoring the study at the various sites,especially at sites that hadmultiple monitors during the course of the study.

b . Please provide a detailed description of how Biopure instructed the internal monitors,each of the CROs and private consultants to report the results of their monitoringactivities, such as the frequency and content of reports . For example (but not limitedto this example), did Biopure expect the monitors to submit reports for eachmonitoring visit, or to submit integrated reports explaining findings during a definedtime period?

Review of monitoring reports during FDA's November 1999 inspection of Biopurerevealed the following :

a. Eight of ten pre-study monitoring reports covering s ix sites were not finalized andreviewed in accordance with Biopure's SOPs .

b. Five of eight initiation monitoring reports covering six sites were not finalized andreviewed in accordance with Biopure's SOPs .

c. Four of28 monitoring reports covering six clinical sites were not finalized per SOPs;the date that each report was finalized was unknown for 22 out of 28 monitoringreports, and zero of 28 monitoring reports were reviewed in accordance withBiopure's SOPs .

d. FDA's November 2002 inspection of Biopure revealed that the internal Biopuremonitors, the CROs, and the private consultants were still not submitting monitoringreports within the specified time frames, and Biopure was still not reviewing themonitoring reports in accordance with their own SOPs .

Please provide a detailed explanation or answer for the following :

i . How Biopure ensured that the clinical investigators were conducting theHEM-0115 clinical study in accordance with the protocol requirements when

Confidential TreatsentRequested by Biopur e

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the internal Biopure monitors, the CROs, and the private consultants were notsubmitting the monitoring reports as required, and Biopure was not reviewingthe monitoring reports in accordance with their own SOPs .

ii . Why BioPure failed to initiate appropriate corrective action after theNovember 1999 inspection to ensure that all monitoring reports weresubmitted and reviewed within the specified time frames .

4. Please provide a detailed explanation of the activities of GloboMax of Hanover,Maryland, in regards to data management and statistical analysis on the HEM-0115study.

Clinical investigator issues

The FDA inspections of fourteen clinical investigator sites revealed significant deficiencies toinclude, but not limited to the fo llowing: (1) many SAES and AEs not reported; (2) ineligiblesubjects enrolled, including subjects with known excludable medical risks ; (3) not all subjectsproperly consented ; and (4) numerous protocol required assessments either not performed or notperformed within the timeframes specified by the protocol, including vital signs, hematologytests, clinical chemistry tests, urinalysis, ECGs, neuro logic assessments, and physicalexaminations. Questions 7, 8 and 10 are examples of the significant deficiencies noted duringthe FDA inspections.

5. The samples for laboratory assessments for hematocrit, hemoglobin, and plasmahemoglobin were either not drawn, or were not consistently drawn immediately prior tosubsequent transfusions. This deficiency was observed at numerous sites .

Please explain how Biopure can assure, without these required assessments, thatadditional transfusions were based on the individual needs of the subject.

6. During the inspections, a review of CRFs revealed that at least seven subjects presentedwith abnormal ECGs during the perioperative period. There was no record in their CRFsto document they were evaluated just prior to randomization/infusion to confirm that theirabnormal ECGs did not meet the definition of acute life-treating or significantdestabilizing event .

Please explain how Biopure can ensure that these subjects were qualified or remainedqualified to participate in the study without documentation of evaluation by acardiologist that the abnormal ECG s were not clinically significant, and the subjectswere cleared to participate in the study.

7. Please describe in detail how Biopurc trained each of the clinical investigator sites,including the principal investigator, all sub-investigators, and study coordinators, beforethe sites began enrolling subjects and using the investigational product to ensure that theprincipal investigators, sub-investigators, and study coordinators fully understood theHEM-0115 protocol and all study requirements .

Confidential ireatientRequested by fliopur e

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8. The FDA inspections, and monitoring reports submitted by the internal Biopure monitors,CROs, and private consultants revealed: (1) missing source documents , (2) incompleteCRFs, (3) unsupported changes to data on the CRFs, and (4) discrepancies between theCRFs, hospital blood bank records, and drug accountability records regarding the date,number of units and volume of the investigational product that was dispensed , transfused,and returned, and (5) discrepancies regarding the date, volume, type and number of unitsof the control product (red blood cells, packed cells, whole blood , etc.) that wa sdispensed and transfused.

Please provide a detailed explanation as to how Biopurc can ensure that the data inthe BLA •submission, in regards to the use of the investigational and/or cont rolproduct, is accurate and reliable in light of the noted discrep ancies .

9. As described above, FDA inspections of the clinical sites revealed significant deficienciesthroughout the course of the study. Several sites had patterns of protocol violations thatcontinued unabated despite repeated monitoring visits that disclosed the on-goin gproblems.

a. Who was responsible for correcting problems and resolving the issues that wereobserved by the internal Biopure monitors, CROs, and consultants during themonitoring visits at the various clinical sites?

b. In response to the problems observed by the internal Biopure monitors, CROs, andconsultants, were any of the principal investigators, sub-investigators and studycoordinators re-trained? If so, what type of training was given? Who was responsiblefor the re-training?

c. Please explain in detail why Biopure failed to initiate appropriate corrective action,such as suspending enrollment of subjects at sites where serious deficiencies werenoted, or terminating the study at sites where continued non-compliance to theprotocol was observed during the multiple monitoring visits by the internal Biopuremonitors, CROs, and private consultants .

10. Please provide a detailed explanation as to how Biopure can ensure that the safety andefficacy endpoints were met in light of the many protocol deficiencies including, but notlimited to the examples described above, which were noted during the FDA inspectionsof these fourteen clinical sites .

How can BioPure ensure that the remaining thir ty-two sites that were not inspecteddo not have the same types of deficiencies , and the data from these sites are reliableand accurate?

Confidential TreatientRequested by Biopur e

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Study Conduct ;

In the various submissions from Biopure related to BLA 125066 for HBOC-201, Biopure hasused the term "softlock" to denote a number of different data management actions . In the BLAitself; submitted July 31, 2002, the teen "softlock" appears in section 16.1 .14 and in thedescription of the historical chain of events for the SEEC process . Similarly, the term "CEVA"(Clinical Event Validation and Adjudication) appears to have been used to denote differentgroups of people or different activities by aData Coordinating Group.

Under section 16.1 .14, on page 12 of the SEEC charter , "softlock" is described as the "resolutionof all site queries for certain critical fields ." This activi ty was supposed to occur before patientrecords were submitted to the SEEC for adjudication for the primary safety endpoint. CEVAData Coordination Services were to be provided by Quintiles , Inc. The CEVA Team was to beresponsible for collecting and evaluating patient safety documentation provided by investigativesites. CEVA was to be responsible for assembling safety assessment patient dossiers for allpatients from all regions and for proofing each file for completeness prior to submission to theSEEC.

In the Historical Chain of Events : SEEC Process, there is an entry dated June 26, 2000 stating,"Softlock Criteria Approved (J. Burke) ."

The letter dated September 24, 2002, contains following statements about "so ftlocking"databases and about CEVA and the Quintiles Data Management group :

• "The adjudication forms for each AE were prepared by CEVA based on the AEs in thesoftlocked AE database managed by the Quintiles Data Management group."

• '"The first sof lock of the database was completed on 22 February 2001 and the last 1"level patient dossier was submitted to adjudicators on 30 March 2001 ."

• "Data Management activities continued after the first database softlock and patients withchanges in the database that would require resubmission of the dossiers to the SEEC wereidentified. "

• "The final sofllock of the database was completed on 29 June 2001 and the last 1`t levelpatient dossier was resubmitted to adjudicators at that time . "

• "1'his [final database as of June 29, 2001) softlocked database was also transferred toRRS ."

1 . Please answer the following questions:

a. What is meant by the phrase, "softlocked database?"

b. The abbreviation "CEVA" appears to be used in several different ways in the varioussubmissions . What activities were encompassed by the term CEVA?

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c. What was the relationship between the CEVA Data Coordinating Center and theQuintiles Data Management group? Did the Quintiles Data Management groupprovide the services collectively called CEVA?

d. Who performed the evaluation of the source documents that were provided to theSEEC?

e. What adjudication forms were prepared by CEVA based on the AEs in the soi}lockedAE database managed by Quintiles Data Management group ?

f. What were the "softlock" criteria that were approved by J . Burke on June 26, 2000?

g. For each individual patient, what critical fields were to be resolved p rior to "softlock"of the file and submission to SEEC?

h. What ro le did Quintiles Data Management g roup play in managing the varioussoftlocked databases and softlocked patient data?

i. What data management activities continued a fter the first database softlock? Whywere these activities not completed befo re submitting the first patient dossiers to theSBEC in November 2000 ?

j . Please explain what is meant by "All post-softlock changes identified" for the June 8,2001 entry in the historical chain of events timeline .

k. Please explain the role and training of CEVA in co llecting, assembling, and proofingpatient safety documentation provided by investigative sites given that these functionshad already been performed beginning in July, 2000 by a "new monitoring team."

1 . Please identify the members of the "new monitoring team" and their affi liations.

i. What was re-monitored by this team?

ii. How were the findings by this team reconciled with the later workperformed by CEVA?

iii. How long did the re-monitoring by the new team take and when werethese activities completed?

m. What or who is AACT? What was the role of AAM.

n. Please describe in detail the SAS listing that was approved by M. Grawryl on October6, 2000 .

Q007


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o. Please explain how patient listings that were blinded for patient identifiers and certaininformation related to investigator determination of severity, seriousness, and drug-relatedness of adverse events were transferred to Red River Statistics for analysis .What analyses were performed on such listings that lacked any investigatorinformation about adverse event severity or seriousness?

p. Please provide a flow diagram and the tames of all individuals who handled sourcedocuments from the time they were completed by the investigative site to the timethey were reviewed by the SBBC for the final adjudication .

q . Please document all transactions, including all involved personnel with theiraffiliations, which occurred after the review process was reopened in February 2001 .The flow diagram provided in the SEEC charter does not appear to document thisprocess completely.

2 . In the letter of September 24, 2002, you stated that : "the documents upon which theBiopure medical review was based were the same as those provided to the SEEC."" Youalso stated that "at no time did Biopure have access to, nor responsibility for maintainingthe database." In the BLA submission, under section 16.1 .14, however, you stated,"Quintiles will ensure that the following data is (sic) blinded to the SEEC, prior tosubmission of each dossier." This list included patient identifiers, and certain aspects ofpatient treatment to include bematocrit, total and plasma hemoglobin, methemoglobinlevels, etc.

a. Please clarify who performed the `Biopure medical review" and whether the Biopuremedical review referred to was for the safety endpoint .

b_ Please clarify whether the safety data provided for the' BioPure medical review" wasalso cleared of the same entries and that the documents provided for the "Biopuremedical review" were identical to the documents provided to the SEEC .

c. Please also clarify whether the documents submitted for the Biopure medical reviewcorresponded to the first patient dossiers submitted to SEEC or to the second set of

files.

3 . Please explain why CEVA was instructed by M. Hensley to stop collection of sourcedocuments for the week between February 13-20, 2001 .

4. Please explain why Biopure requested re-copying of all source documents from dossierfiles (via J. Cermak) on February 23, 2041 . For what purpose were these files recopied?What files were recopied? To whom were the fi les provided?

5. Please explain why the SEEC was asked to re-review patient records for a newadjudication for the primary safety endpoint . What ,postsoftlock" changes were reviewed

by the SPEC during the second review cycle?

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6. When 506 files were re-reviewed, did the original reviewers perform the second review?If not, why not?

7. Please explain who attended the adjudication meetings documented in the historical chainof events document and what was the purpose of the meetings .

8. In the chronology of major project developments for SEEC, you state that the first threesubmissions for 1' level SPEC review were submitted to SEEC before CEVA initiatedsite contacts for collection of source documents (November-December, 2000) . The roleof CEVA was to provide case report form and source documentation, which wa s"accurate, focused, and relevant" CEVA was also charged with resolving all site queriesfor certain critical fields BEFORE submission of any documents to SEEC . Please explainhow the first three submissions were provided to SEEC before CEVA had contacted anysites.

How was the toxicity grading scale used by the investigator? Was the toxicity gradingscale used during any remonitoring of the clinical data or the clinical sites?

10. Between February 26, 2001 and April 16, 2001 , Biopure reviewed all source documentsfrom the dossier file and submitted new AEs (N=1443 ) to CEVA for review by theSEEC . However, in the September 24, 2002 le tter, you stated that Biopure did not have adirect role in providing information to the SEEC . Please explain the relationship andprovide the identities of the clinical personnel contracted by Biopure to review andprovide new source documents to the SEEC adjudicators for re-review . Were thesepersonnel completely independent of Biopure ? Why was this function not performeddirectly by CEVA, to whom this function was assigned by SEEC charter?

a. Please provide a detailed summary of the contractual obligations assumed byQuintiles and other data management services with regard to the "cleaning" of datafor study HEM-0115.

b. Was the February 26, 2001 to April 16, 2001 review of all source documents theresult of the July, 2000 remonitoring effort undertaken by the "new monitoringteam?„

c. Were these adverse events also incorporated into the documentation upon which theBiopure medical review was based?

11 . In the historical chain of events, three transfers of the SEEC database to Diopu aredocumented . The last transfer occurred on August 9, 2001, and the notation "completedata, locked" is recorded . On September 24, 2002, you stated that, "at no time didBiopurc have access to nor responsibility for maintaining the database." However, in thetext of the original BLA submitted July 31, 2002, on page 65 of the report of study HEM-0115, you stated that, "The database was subsequently transferred to Rod River Statistics(RRS), Shreveport, LA. RRS and Biopure jointly completed data cleaning activities ."

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These statements would appear to be contradictory. Please clarify and answer thefollowing questions.

a. Who prepared the database from the output of the SEEC deliberations ?

b. Did Biopurc have access to the databases constructed from the SAP-1 and SAF-2forms ?

c. Who provided the analysis datasets to Red River Statistics ?

d. You stated that Quintiles completed data management activities for and hardlockedthe CEVA database on 8/9/01 and that the hard) CEVA database wastransferred to both Red River Statistics and Biopure on August 9, 2001 . However, thehistorical chronology provided in the BLA indicates that two transfers of incompletedata from the SEEC database to Biopurc occurred on July 12 and July 20, 2001 . Howwere these databases used by Biopure?

e. In the September 17, 2002 letter submitted from Red River Statistics, it is noted thatchanges to an interim dataset dated June 29, 2001 were made by Red River Statisticsand that these changes are memorialized in a SAS program module namedERRATA.SAS. This file contains additional raw data for adverse events andconcomitant medications received after the June 29, 2001 cutoff date , Please clarifywhether the second SEEC review contained the information that is contained inERRATA.SAS .

12. In the letter of May 12 , 2003, you stated that "it was always Biopure 's intention to derivethe secondary safety endpoints for the HEM-0115 study from the Investigator Database,not the internal scoring of the SEEC ." Please note that it was always FDA's intent thatAU of the analyses, including the seconda ry analyses, be performed using the databaseconstructed from the blinded review by the SEEC. Please note that the FDA letter to you,dated September 15, 1999, explicitly stated that:

`The review of data by the Independent Data Monitoring Committee (N .B. later renamedthe SEEC) at these various time points (including at the conclusion of the study) was tohave been blinded to treatment allocation . The determination of severity and seriousnessof adverse events by unblindcd investigators on-site was to be masked from theIndependent Data Monitoring Committee. The Independent Data Monitoring Committeewas to evaluate all adverse events and make an independent determination of intensityand seriousness of the adverse events, all in blinded fashion ."

That letter went on to state that all serious adverse events, as determined in blindedfashion by the IDMC, would be categorized and evaluated according to the proposedstatistical analysis plan . This statement did not distinguish between the primary safetyanalysis and the secondary safety endpoints, and the FDA letter of December 10, 1999simply summarized the secondary safety endpoints that would be evaluated . In theSeptember 15 and December 10, 1999 letters, FDA provided adequate documentation o f


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what was expected for a regulatory submission . Omission of the recommended designfeatures did not constitute g rounds for imposing a clinical hold . On March 27, 2000 andJuly 7, 2000, you received letters from FDA that stated, "The statistical plan describednotwithstanding, ultimate approval of yourproduct depends on the totality of theevidence submitted from appropriately designed and conducted clinical studies includingsatisfactory rislc benefit outcomes." Biopure acknowledged these statements.

Since Biopure did not perform the secondary safety analyses as expected and in themanner recommended by FDA, please cla ri fy the fo llowing points :

a. Who performed the medical evaluation of the secondary safety endpoints for thepurpose of reporting in the BLA?

b. Who generated the, safety database for the secondary endpoints of study HEM-0115?

c. Who audited the safety database against source records and who monitored andreconciled the data. When was the database audited and when were the datareconciled?

d. What is the nature of affiliation and financial relationship to Biopure if the medicalreviewers were not Biopurc personnel?

e. Were the medical reviewers blinded to treatment assignment?

13. It is FDA's understanding that site-identified adverse events and source documents wereprovided to SEEC for determination of seriousness, intensity, and causality of the events,and that these, together with additional adverse events identified by each SEEC reviewer,were used to generate the SAP-1 dossier for each patient . This SAF-1 dossier was thenused by each SEEC reviewer to assign a medical risk score that was recorded on SAF-2 .

Further, the SEEC charter stated that,

"SEEC identified adverse events : The SEEC is not charged with the task of identifyingall potentially un-reported adverse events ; however, if during the course of reviewing acase for adjudication, a SEEC reviewer notes an unreported adverse event, this data (sic)should be captured." The charter further states that the CEVA Data Coordinating Centerwill review all completed adjudication CRFs for potential adjudication dat a

discrepancies . If discrepancies are identified, a query will be issued to the reviewer whosupplied the data . "

"In order to proactively prevent the need to issue queries, the CEVA Data CoordinatingCenter has prepared a guideline for the completion of the adjudication CRFs which willbe utilized by the SEEC. " (This guideline included information about both the SAP-1and SAF-2 forms. )

If it is the case that the SEEC reviewers used adverse events recorded on the SAP-1forms in order to generate the adjudication recorded on the SAF-2 forms, and that the

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14.

15 .

16.

adverse events recorded on the SAF-1 form :investigator or the SEEC reviewer, and it iscompletely monitored and/or reconciled agaconcluded that the medical assessment of riiconform with cGCPs . Your letter of May 12imposed on IND 10792 and also submitted idatabase was not designed or chartered to bi(GCP)". Please clarify how a database thatprimary safety analysis was not designed orPractice.

a . If SEEC members found additional ad,from the clinical sites, how was the valdetermined, and were the additional, vwhich the Biopure medical assessment

In the May 12, 2003 letter, you stated that thagainst source documents nor was (sic) datastatements, it would appear that the informs'endpoints may have differed substantially ftclarify. Please explain why the SEEC AE/S)material .

In the May 12, 20031e!, you stated that

that the December 10,1999 letter from FDAthe IDMC evaluate all adverse events, not cinvestigators. The specific language states,events in blinded fashion for each individwdetermination of intensity and seriousness cblinded to investigator determination of int'

determination." Further, Biopure itself stateconclusion of the study, in blinded fashion,whether serious or not, by individual subjecPlease comment .

In the letter of September 24, 2002, you stated that :

"In July of 2000, it was learned by Biopure 1 egulatory Management that clinical siteshad inconsistently interpreted the type of ad% arse events that were to be recorded in theCRFs . In order to ensure the accuracy of the data, it would be necessary to re-monitor a llclinical data submitted by the Investigators . "

"In December of 2001 , after a review of thethe Investigators had consistently applied tinspecially designated Biopure team conducted

could originate either from the on-sitelso the case that the SAP-1 entries were notnst source documents, then it may bewas based on a data set that did not

2003 in response to the clinical holdthe BLA states that, "SEEC AE/SAE

consistent with Good Clinical Practiceras generated for the purpose of at least the;bartered to be consistent with Good Clinical

c events over and above those reportedy of the findings by the SEEC membersadverse events added to the database upons made?

9012

SBEC AE/SAE database was not auditedLonitored or reconciled . Based on these>n reviewed for the seconda ry safetyn the data reviewed by the SEEC. Please

database was not audited against source

reviewers were notven s c assified as non-serious. Please noteclearly stated that it was FDA's intent thatly those deemed serious by the on-site['he role of .IDMC-2 is to review all adversesubject and to perform a separatethe adverse events. The IDMC was to besity and seriousness when making thi sthat the function of the IDMC-2 was "at thereview listings of all adverse events ,for all subjects enrolled in the study ."

lata listings, it was discovered that not all ofSAE definitions when recording data . Aa complete Medical Review of all Serious

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Adverse Event (SAE) listings against the oto Biopure to assure consistent classi ficatiaAdverse Events . . . .As a result of the audits,Investigators to correct any data discrepanc

In the letter ofMay 12, 2003, you stated

"SEEC reviewers did not always apply serifknown side effects of HBOCs (e .g., elevateand conservatively. This is particularly truepcrsistent/significant disability/incapacity a

There was a high degree of disparity amoidifference in the number of SAES for any

A number of comments pertain :

a. These various statements, taken tolbe incomplete and at worst not condetermination of safety or efficacy

b. What criteria were applied to thePlease provide the Monitoring (

c. Why did the remonitoring actions that (inconsistencies in the classifications of

d. Please provide the names and affmonitoring teams that visited the

e. The comments suggest that corrections,been made to the databases after the so-iSpecifically, the letter of September 24,documents in December 2001, and corninvestigators. Please comment.

L Why did the remonitoring that occurredbe reviewed by the SEEC? Were any ofnot recorded by the on-site investigatorsadverse events were not also captured b :teams sent by Biopurc.

Please provide a fully detailed flow diagranall source documents, including but not limetc. from the time of completion at the inveultimately submitted to the BLA. (see item

0 013

anal CRFs and source documents submittedprocessing, and reporting of SeriousCFs were written and signed by thes discovered."

is criteria consistently and tended to classifyliver function tests, jaundice) more seriouslybr the serious criteria pertaining toI important medical events . . .

idividual SEEC reviewers : e.g., thesubject was frequently between 10 and 20 . "

suggest that the data recorded may at bestan adequate basis upon which to make a

,ring efforts that occurred after July. 2000?that were used for this effort .

after July, 2000 not capture the

of all members of all monitoring and re-sites .

;es, additions, or subtractions may havehardlock of August 9, 2001 .documents re-review of sourcethat were signed by the on-site

got clarify all the adverse events that were tohe adverse events recorded by the SEEC, butvalid? If so, please explain why thes ethe investigators and/or the monitoring

and narrative description of the handling ofed to case report forms, patient chart records,igative site to the generation of the databasesabove)


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Please provide a fully detailed flow diagram and narrative description of the generationof each database that was developed, to include, but not limited to, additions,subtractions, corrections, etc .

Please provide a fully detailed flow diagram and narrative description of all of theremonitoring efforts that occurred between the conclusion of the study and thesubmission of the BLA .

Please provide a detailed list of all the individuals, including affiliation and financialrelationship to Biopure, who were involved in data management and databasemanagement activities for HEM-0115 .

FDA reserves the right to re-evaluate the output of the SEEC adjudication and thedetermination that the primary safety endpoint was in fact met in ITEM-0115 pendingreceipt of your answers to the above questions regarding study conduct and integrity ofthe data.

Clinical Trials

HEM-0115 (Efficacy) :

The case report forms provided and the case tabulations and patient summaries containnumerous discrepancies, cross-outs, and unexplained deletions with regard to allogeneictransfusions given. It will be necessary for you to reconcile the case report for minformation against blood bank records and the patient charts in order to ensure theaccuracy of these data that contribute to the assessment of the efficacy endpoints of thetrial

a. Please provide blood bank records, physician orders, and patient chart data to confirmall transfusions and infusions given.

b. Please cross-check these source documents and provide an accounting of alltransfusion requests, transfusions administered, used and unused bags returned to theblood bank, etc. to ensure the accuracy of the data entered into the case tabulationsand the case report forms .

c. Please provide complete and accurate summary data for all transfusions administeredincluding, but not limited to the type and volume of product administered etc .

FDA reserves the right to re-evaluate the efficacy data pending receipt of thisinformation.

2. Please provide the efficacy data for test and control groups in tabular format with eachrow of the table devoted to each individual patient . Each patient should have data enteredon a single row and each row should contain all the information related to transfusion

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decisions and transfusion outcomes (relationship to prior trauma event, volume of bloodlost, volume of fluids administered, volume of autologous blood collected andadministered, time of randomization, baseline hemoglobin and hematocrit, etc .) . Thedatabase should be constructed such that chronological events related to the efficacyendpoints can be read from left to right across the table . Each laboratory test entered intoa column of the table should have the same unit of measure so that data analysis may beaccomplished readily. The column headings should include, but are not limited to, dateand type of surgery, time of surgery start and stop, total hemoglobin and hematocrit atrandomization, reticuloeyte counts at various time points, etc. The table should beconstructed such that running time analyses may be performed The data points enteredinto the table should refer to the source laboratory document, and the laboratory site(central, local, point of care) should be documented in the table .

FDA reserves the right to re-evaluate the efficacy data pending receipt of a tableconstructed in this manner.

3. Please provide all missing data for pre- and post infusion total hemoglobin so thatincremental increase in total hemoglobin due to administration of the product may becalculated. Significant numbers of data points appear to be missing from the case reportforms. Based on the available data , the median increase in total hemoglobin following theloading dose of 60 g HBOC-201 would appear to be 0 .3 g/dL rather than the expected 1 .0g/dL. Subsequent doses of 30 g BBOC-201 also appear to have increased the totalhemoglobin concentration by approximately 0 .2 to 0 .3 g/dL . Please comment.

4. The BLA text states that dosing of HBOC-201 by 30 g dose intervals was intended tomaintain plasma hemoglobin levels at safe and physiologically appropriate ranges . Theclinical trial, however, did not specify what the target plasma hemoglobin level shouldbe, and dosing decisions were based on the total hemoglobin concentration rather than acombination of RBC hemoglobin levels plus plasma hemoglobin levels or the plasmahemoglobin levels alone.- Of the 317 patients treated with less than the full 300 g dose ofHBOC-201, approximately 30% ultimately were transfused with allogencic rod blood

cells. Most of these patients were transfused because clinicians did not appear to be ableto manage their patients based on assessment of total hemoglobin levels, because the totalhemoglobin levels did not increase as expected .

The dosing recommendations provided in Table 1 of the proposed package insert are notsupported by clinical data from HEM-0115 or HEM-0114 . Any dosing guidelines basedon plasma hemoglobin levels would require confirmation in an adequately sized andadequately powered phase 3 clinical trial . In turn, support for dosing based on plasmahemoglobin levels would require sufficient phase 2 data to suggest that dosing based onsuch a measure is safe and likely to be efficacious . Please comment.

Given the information from the clinical trial, it is not possible to write adequate and safedosing guidelines, and the utility of the dosing guidelines in Table I (using plasmahemoglobin levels) of the proposed package insert cannot be confirmed . Please comment.

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5. Many transfusions in the control red blood cell group were given back-to-back . This isparticularly true for those patients who received only two units of blood . It is not clearwhether this phenomenon also occurred for patients randomized to I-BOC-201 who alsoreceived allogneic red blood cells .

a. Please provide the records for each hospital transfusion oversight committee togetherwith the records for each site for transfusion practices for the specific surgicalprocedures performed What measures are in place at each of the study sites forcontrol of transfusion decisions?

b. Please include information on allogencic transfusion from each site for patientstreated for the one year prior to initiation of the study and for concurrent patients whowere not enrolled in the clinical trial. The report should include information aboutpatients who underwent the specified orthopedic procedures and who did notpredonate autologous red blood cells or use opoietin .

6 . It would appear that transfusion avoidance for study HEM-0115 was largely driven byavoidance of allogeneic transfusion among those subjects who received only 60-90 g ofHBOC-201 . In this group, the median time to transfusion was 2 .5 days. At 91-180 g ofproduct, only 50% of subjects avoided transfusion and the median time fromrandomization to transfusion was approximately 4 .5 days. Between 181 and 270 g ofproduct, only 32% of subjects avoided transfusion, and the median time to transfusionwas 3 .3 days. At 300 g of product, 75% of patients received allogeneic red blood cells .The median time to transfusion was approximately 3 days. Patients who receivedEBOC-201 in any dose and who also received allogeneic red blood cells, received amedian dose of 2 units (mean approximately 3 units) of red blood cells. This dose of redblood cells was comparable to or slightly higher than the dose received by patientsrandomized to the control group. Thus, at doses above 90 g of HBOC-201, not only wemany patients exposed to the dose of HBOC-201, they also were also exposed toallogeneic blood in the amounts received by the control group . Please comment .

7. Patients in the test arm had, on average, approximately 1 g/dL lower total hemoglobinlevels than did patients in the control arm for treatment days 2-6 . At discharge, patientstreated with HBOC-201 had hcmatocrits of 28 as compared to patients treated withallogeneic red blood cells who had discharge hematocrits of 31 . Thus, patients treatedwith HBOC-201 were discharged from the hospital significantly more anemic thanpatients in the control group. Please comment .

Please re-analyze your efficacy database that FDA has asked you to construct and reportyour conclusions in your response to this letter. Your analyses might include, but shouldnot be limited to, comparison of incremental increase in total hemoglobin levels as aresult of administration of each unit of product or control, comparison of totalhemoglobin- levels on treatment days 2 through 6 for each group, a comparison ofdischarge hematocrits, review of changes in reticulocyte levels and other measures ofoxygen delivery by the product, and an analysis of transfusions administered at each dosecohort of HBOC-201 .

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REM-0115 (Safety) :

Many of the CRF Adverse Experience pages have cross-outs , deletions, additions,missing dates and/or times , or arc marked "re-monitored". It will be necessary toreconcile the CRF information against hospital records in order to ensure the accuracy ofdata that contribute to the safety profile.

a. Please provide copies of source documents to substantiate all CRF AdverseExperience changes as enumerated above.

b . Please provide the names and affiliations of at individuals who entered or modifieddata entries on a CRF-by-CRF basis , and the dates and times when these changeswere made.

FDA reserves the right to re-evaluate the safety data pending receipt of this information.

2. Please provide the safety data for test and control groups in tabular format . Each rowshould contain all the information related to the adverse event (please request a samplecopy from FDA). The database should be constructed in such a way that the chronologyof the adverse event can be read from left to right and that can be readily analyzed usingstatistical software . The column headings should include, but are not limited to, age,gender, CTM dose, time of surgery, time of treatment-emergent AE, time of first CTMinfusion, time of last CTM infusion, time from 1" CTM infusion to time of treatment-emergent AE, time from last CTM infusion to time of treatment-emergent AE, totalamount of CTM administered at time of treatment- emergent AE, official time/date ofpremature discontinuation of CTM, official reason for premature discontinuation ofCTM, and time/date of l' non-CTM transfusion.

FDA reserves the right to re-evaluate the safety data pending receipt of tables constructed

in this manner.

3. The incidence of acute myocardial infarction is different between the SEEC and FDA(based on entries by investigators in the Adverse Events pages of the CRF) databases .

a. Please provide FDA with copies of all source documents supplied to the SEEC

regarding this issue.

b. Please provide copies of all source documents for all subjects with respect to

troponin and CK-MB values.

c. Please supply tables for all CK-MB and troponin values, as outlined in question 2(above) . Note that each laboratory test entered into a column of the table should havethe same unit of measure so that data analysis maybe readily accomplished usingstatistical software.

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4 .

5 .

6 .

d. There are numerous instances where datasets for the same subject report iden ticalvalues on the same CRF page for bg 1h troponin I and T. Please explain how thisoccurred , which valuelparameter is correct , and supply the correct CRF page for eachvalue reported in these datasets,

e. Subjects 0915 and 1113 had tropo 4 values entered by hand on the CRF page, yetthe data printout with troponin values for this day is missing . Please explain the originof these troponin values.

The incidence of acute renal failure (p +specificd as dialysis-dependency) is differentbetween the SEEC (7 vs . 2) and FDA ( vs . 1) databases.

Please provide PDA with all sourceissue and explain why there is a discSEEC adjudication of the same eve

Laboratory measurements of amylase,HBOC-201 subjects.

its provided to the SEEC regarding thisbetween the investigator information and

, and ALT are deleted (or missing) for many

a. Please explain why these values are issing or deleted, provide raw data for thesemissing data, identify the particular analyzer used to make the measurement, and themethodology used to obtain correct values that reflect the presence of HBOC-201at each corresponding study site .

b. Please explain why the amount ofand 3 is much greater in the HBOCperioperative period.

Progress notes for subject 2513entries on or around 9/16/1999 .

a. Please provide source documents(if applicable) dialysis nursing no

b. Similar requests pertain to subjects

ng data for AST and ALT at treatment days 2arm than in the control arm .during the

the possible necessity for renal dialysis, but omi t

all consultations and Al progress, nursing, andfor this subject .

, 4820, and 5405 .

7 . In your table, "Summary of Data tan es Concerning Serious Adverse Events Generatedfrom the HEM-0115 Medical Review", 'ch was sent to FDA after BLA submission,you list changes in adjudication and/or severity made by Biopure to the SAES . Pleaseprovide copies of all source documents substantiate each change .

8. Regarding product immunogenicity, pl a provide details of the antibody maymethodologies, including the definition of the IgG antibody unit, and the sensitivity andspecificity used for positive and negati controls .

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9. Please evaluate the cross reactivity of these antibodies to human hemoglobin and describea plan to assess the risks to patients who develop antibodies to HBOC-201 of repeatexposure to the drug.

10. Please provide an analysis of drug-drug interactions including interactions of HBOC-201with anti-hypertensives, vasodilators, diuretics, cardiac glycosides, and colloid solutions,etc.

11 . Please provide a list of, and analyze the data from, patients who received product near theend of the expiration period.

HEM-0114 :

1. Please provide analyses on safety and efficacy data for patients who underwentorthopedic surgery in HEM-0114 .

2. Please clarify what sponsor responsibilities were transferred to CRO(s) for HEM-0114 .

3. The clinical protocol for HEM- 0114 states that there is an Appendix G, "Clinical SafetyData Management: Definitions and Standards for Expedited Reporting; ICH $2A, March1995", but only Appendices A and B are present in the BLA. Please include allappendices for this protocol in your submission .

4. Here were patients in the red blood cell treatment group who had neither completed sixCTM infusions, nor reached the time limit for receiving CTM, but were transfused withallogeneic red blood cells considered as non-CTM . Please provide the reasons thesetransfusions were considered non-CTM.

5. Please provide explanations for withholding CTM infusion(s) when such infusions are"permitted"

6. Please detail the information on the patients not discharged from hospital, including theirultimate disposition.

7 . Please address the issue of interference of laboratory tests in HEM-0114 (see below,clinical laboratory) .

8 . In the BLA, the normal ranges of the chemistry laboratory tests are given in a distincttabulation . As the normal ranges might vary widely depending on the testing laboratory,the data in the listings for chemistry laboratory tests become incomprehensible in theabsence of the normal range for each listing. Please provide the normal values for eachlaboratory test in the patient data listings adjacent to the test results . If central laboratoryresults arc available, please provide . this information as well .


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9. Please provide all post-baseline clinical hematology and chemist ry data listings;including CPK, CK-MB and troponin, regardless of whether such data were from thetreatment period or not .

10. Please provide complete information on the assays for antibodies to HBOC-201 and thedata obtained,

11 . Please provide an analysis of drug-drug interactions, including interactions of anti-hypertensives, vasodilators, diuretics, cardiac glycosides and colloid solutions with yourproduct in HEM-0114 .

12. Please provide all CRFs for HEM-0 114, including laboratory printouts. In addition,please also.providc:

a. Copies of source documents to substantiate jU CRP' Adverse Experience changes asenumerated elaborated in question 1 a (above) under HEM-0115 (Safety)-

b. Names and affiliations of gill individuals who entered or modi fied data entries on aCRF-by-CRP basis, and the dates and times when these changes were made .

13. Please provide tables for all treatment-emergent adverse events, as outlined in question 2(above) under HEM-0115 (Safety) .

14. Please provide a list of the subjects who were administered product near the end of theexpiration period of the lot.

15. Please provide a copy of all training materials supplied to investigators, a check-off list toverify their attendance at all training sessions, and results of tests you administered toverify their understanding of GCP.

Other Clinical Studies

General Comments about the phase 2 studies :

1 . Please provide all case report forms, individual patient data, laboratory printouts, andsource documents to support claims of safety and efficacy for all phase 2 studies .

2. The case report forms that were provided for the phase II studies contain numerousdiscrepancies, cross-outs and unexplained alterations with regard to transfusions given .

Accordingly, please provide explanations for missing and crossed-out data in the casereports a.) originally submitted with the phase 2 studies in this B LA and b .) all additional

requested case report forms for the phase 2 studies .

3 . Please provide the anesthesia records for all surgical patients in all of the phase 2 studies .

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4. For all phase 2 studies in which hemodynamic monitoring was performed using a PAcatheter, please present a table that includes individual patient data listings for thefollowing calculated hetnodynamic parameters : systemic vascular resistance, oxygendelivery, oxygen consumption, and oxygen extraction ratio .

5 . Please provide final study reports for all phase 2 studies conducted to support claims ofefficacy and safety for your product.

6 . Please provide the efficacy data for the test and control groups for all phase 2 studies in atabular format with each row of the table devoted to each individual patient . Each patientshould have data entered on a single row and each row should contain all the informationrelated to transfusion decisions and transfusion outcomes (relationship to prior event,volume of blood lost volume of fluids administered, volume of autologous bloodcollected and administered, time of randomization, baseline hemoglobin and hematocrit,etc .) The database should be constructed such that chronological events related to theefficacy endpoints can be read from left to right across the table . Each laboratory testentered into a column of the table should have the same unit of measure so that dataanalysis may be accomplished readily. The column headings should include, but are notlimited to, data and type of surgery, time of surgery, total hemoglobin at baseline andthen at randomization, etc. The data points entered into the table should refer to thesource laboratory document, and the laboratory site (local or central) should bedocumented in the table .

7 . Please address the issue of laboratory interferences-on laboratory tests in the phase 2clinical trials .

Study M9990-0075 :

8 . Please provide the reasons for CTM transfusion and the data to support the decision totransfuse for each patient and each transfusion in this clinical trial .

9 . You state the following conclusion for the above referenced study :

" In summary, in the present study, HBOC-201 was used to treat post-operative anemia incardiovascular surgery patients in the intensive care unit . We found that : HBOC -201eliminated the need for postoperative allogeneic transfusion ." (Page 106) . The statementis misleading . Only 34% of the patients who were randomized to the HBOC-201 grouprequired no postoperative allogeneic RBC's . Please provide information on the number ofpatients who avoided allogeneic transfusion po rt operatively but who had been transfusedintraoperatively. .

10. The conclusions on page 106 also state that HBOC-201 was safe and well tolerated ;however, the following adverse events were seen in this clinical trial:

a. Se rious adverse events in HBOC-201 group had more SAB's than the RBC group: 19vs . 4 . Of the HBOC-201 SAE' s, 11/19 were cardiovascular events such as ventricular

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tachycardia, atrial fibrillation, arterial desaturation, pericardial effusions, CHF,respiratory distress and dysrbythmias . In the RBC group, the SAE's consistedprimarily of infections/ cellulitis (3/4) and small bowel obstruction (1/4). Pleasecomment.

11 . FDA notes that the only death in this study, patient 310, was infused with CT'M#2without having met the postoperative transfusion trigger criterion . According to ,protocol, the patient could be transfused with CTM if the hemoglobin was between 6 .5and 9 g/dl . In the case of patient 310, the pre-CTM #2 hemoglobin level was 9 .5 . Pleaseprovide an explanation for why this patient was given additional CTM for a lowhemoglobin, when in fact the patient's recorded hemoglobin was above the level requiredfor CTM infusion.

12. FDA notes that for subjects who discontinued CTM (section 12 .2), most were stoppeddue to investigator concerns about safety (cardiorespiratory or neurological deterioration)and subjects experiencing adverse events . Please comment

Study BR-0049-0144 :

13 . Study BR-0049-0144 references the following publication : "The Effects of IncreasedDoses of Bovine Hemoglobin on Hemodynamics and Oxygen Transport in PatientsUndergoing Preoperative Hemodilution for Elective Abdominal Aortic Surgery", Kasper,ct at . Anesth Analg 1998; 87: 284-291 . The author of the publication concludes thatBovine hemoglobin in doses ranging between 55 and 97 grams of hemoglobin increasedvascular resistance and decreased cardiac output in anesthetized surgical patients .Furthermore, he states that hemodilution with bovine hemoglobin in those doses rangesprovided no apparent benefit over hemodilution with hydroxyethyl starch : Given the datathat you provided for this study, please comment on the validity of the above statements .

14. In addition to intraoperative anesthesia records, please provide individual patient datalistings for the following hemodynamic parameters : oxygen extraction ratio, systemicvascular resistance, oxygen consumption and oxygen delivery.

15 . Please provide the DSMB members and charter for this study.

FDA reserves the right to review the clinical data of all phase 2 studies pending thereceipt of all requested information .

General Comments on Clinical Studies

Please provide hospital records for AU patients who received HBOC-201 on the basis ofcompassionate use.

2. Please provide data, which show that HBOC-201 can be administered safely at clinically

relevant rates in the setting of uncontrolled surgical bleeding .

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3. Please submit Full Study Reports for studies where there are only abstracts and/ormanuscripts in the BLA.

Statistics

It is not clear why the sample size was amended shortly before completion of studyHEM 0115 . Please explain whether the sample size was amended because ofobservations about the data collected to the point of sample size increase, if not, pleaseexplain why the sample size was increased.

2. An annual report was submitted on June 6, 2002 under BB-IND 2935 for the reportingperiod from February 1, 2000 through January 31, 2001 . Study HEM-0115 wascompleted two and a half months before the end of the reporting period . TIowever,'thenumbers of deaths reported in the annual report in the HBOC and RBC arms were 6 andI respectively, compared with 10 and 6, respectively, in the BLA submissions . Pleaseexplain the discrepancy in reporting and account for the under-reporting of deaths,considered to be serious adverse events, in the annual report .

3 . In the HBOC-201 group, 5 deaths occurred among 31 patients who were older than 80years compared to 1 death out of 26 in the RBC group . The difference is marginallysignificant (p = 0.074; one-sided Fisher's exact test). Please comment.

4. Although there is no significant difference between the two arms (10/350 vs 6/338; p =

0.45), the number of deaths observed in the study seems a little too high in considerationthat these are elective surgeries (16/688 = 2 .3%; 95% confidence interval is (1 .3%.

3.7%)) . Please comment on this observation in light of the mortality rate of a similarpatient population with similar types of surgery from historical data.

5 . Please provide the randomization code with detailed description of the randomizationscheme and patient ID . Please also identify those who died .

6. Table 14.5.1 of BLA Amendment 2 also shows that there is a highly significantdifference between the two arms (HBOC vs RBC : 81/350 vs 46/338 ; p < 0 .001) inproportions of patients experiencing at least one SAE that resulted in death or persistentdisability. Furthermore, there are 23 .7% (83/350) of patients in the HBOC group whoprematurely discontinued from CTM compared with 2 .4% (8/338) in the RBC group.

a. Please justify the benefit of avoidance of allogeneic blood transfusion byadministration of HBOC in light of higher proportions of patients experiencing atleast one SAE that resulted in death or persistent disability and higher rate ofprematurely discontinuation from CTM.

b. In connection with (a) above, please provide a 2 by 2 table defined by avoidance andSAE that resulted in death or persistent disability for the HBOC group .

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Clinical Laboratory Measurements

1 . Although the BLA text states that in situations where the central laboratory(ies) was orwere used, data management rules dictated use of the central laboratory data ; however, itis not clear from the BLA text, the case report forms, the case tabulations, or theindividual patient summaries which clinical laboratory results, i . ., local, centrallaboratory, or point-of-care, were captured in the clinical database . In addition, thehypertext links from the patient summaries take the reader to one of several differentreportings of individual patient laboratory results . In some instances, the link takes thereader to the central laboratory result, In other instances, the link takes the reader to thecase report forms. Some case report forms are associated with clinical laboratoryprintouts while many others are not . Thus, it is not possible to be sure whether the datareported in the case report forms represent local laboratory results or central laboratoryresults .

a. Please provide clear documentation for each clinical laboratory result for each siteabout what laboratory results have been submitted to the BLA for review,

b. The BLA text states that three different'central laboratories, one each in the UnitedStates, Europe, and South Africa, were used for reporting of the clinical laboratorydata. Since the data from these various sources are to be combined for study HEM-0115, please provide information about the clinical laboratory reference ranges,documentation of your efforts to assure that clinical data reported from each of thecentral laboratories were comparable such that the data could be combined forreporting purposes, the results of such studies, and a description of theinstrumentation used for each laboratory assay at each of the three central laboratorysites .

2. Each hospital's laboratory was supposed to have been evaluated, and an assay limitationsheet listing all parameters available for patient management and for the study, was tohave been provided to the hospital's laboratory and the investigator. In regard to thesepreconditions, please provide the following

a . Documentation that this evaluation was performed at each site and that eachinvestigator and each hospital .laborator,' was provided with the appropriate assay

limitation sheet .

b. The assay limitation sheet for each site listing all parameters available for patientmanagement .

c. The data from each clinical site and for each central laboratory regarding colorimetricand other potential interferences in assay results due to the presence of HBOC-201 inthe plasma or serum samples .

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3 .

d. The information about what backup farequired for patient management and sstudies to evaluate these back-up sites .

e. The information about the . training of ilocal laboratory and central laboratoryclinical studies reported in the BLA. °

f. The information about the training, themethods used for all assays performedclinical studies.

g. Clarify if clinical results repo rted in tHHBOC-201 . Absent such information,data sufficiently to make accurate conicare or patient safety.

In the tabulations and case reportother laboratory data have been d

The BLA contains articles and abstractsinterference by HBOC-201 in clinical ladocumenting the interferences for conutlaboratory instrumentation, and commo i

a. Please provide for review the data frotHBOC-201 for commonly used clinicoinformation about interferences over tlwhich patients will be exposed and sblikely analyte concentrations .

If HBOC-201 interferes with clinical xcharacterizing the direction and ma911ilevels.

b . Please provide information aboutsystem), which you have tested.

c. Please provide a list of all analytes, byii . there is no interferenceiii . interfemce can be correctediv, no results can be obtained v

circulation, above a specific

ss were available to ensure that parametersconduct were available; and the results of

the specific procedures followed by bothsonnel for the conduct of the various

ecific procedures used, and quality controlpoint-of-care instruments used in the

BLA were corrected for assay interference byis not possible to review clinical laboratory

usions about the effect of the drug on patient

you report that various clinical chemistry andWhy were these data deleted?

narizing data regarding potentialury assays but does not contain any raw dataused laboratory assays, commonly use ded point-of-care instrumentation.

studies to assess the degree of interference byassays . These studies should providefull range of concentrations of HBOC 201 to

old assess interference over the full range o f

irements, please provide informatio n

of the bias associated with varying drug

assays (including the name of the test

used, for which

lie HBOC-201 is still present in thet reshold .


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d. Please provide validation data supporting the use of commonly used clinicallaboratory and point-of-care instruments for analyzing patient samples containingHBOC-201 .

e. Additional interference studies should be ongoing with samples drawn from studypatients. The purpose of these studies is to validate other methods and analytes usingreal patients samples by using established methods as comparators . Patient samplesshould be banked for future use. Please comment

Ph armacolofv/toxicology

Study (NC101) :

1 . Based on results from NC101 it appears that HBOC-201 delivers excessive amounts ofoxygen to the tissue evaluated (left quadriceps muscle) and results in equally excessiveglobal oxygenation and tissue oxygen extraction . Conversely, both stored and freshblood normalizes tissue oxygenation parameters relative to pro-hemodilution values .

Please comment on the performance of stored and fresh whole blood in this model andprovide a rationale for why apparent tissue over oxygenation by HBOC-201 isappropriate.

2. Under conditions of bypoxia, excess oxygen delivery inevitably will lead to oxidativecascades and tissue injury.

a. Please comment on the potential longer-term effects of excessive oxygen deliveryapparently mediated by HBOC-201 .

b . Please comment on the study duration and why a short-term evaluation was chosen toaddress a pivotal question (i .e. does HBOC-201 provide optimal tissue oxygenation?)most appropriately determined over a minimum of 24 hours . .

c. Please provide metHb concentrations for at least 24 hours following the final infusionof HBOC-201, tissue oxygenation parameters for at least 24 hours following the finalinfusion of HBOC-201 and an assessment of any tissue oxidative damage.

3 . Study NC101 models a severe situation of isovolemic anemia and is intended to mimicthe expected scenario for HBOC-201 utilization in clinical situations of surgical anemiarelated to blood loss. However, an important clinical parameter is volume status andpatients generally don't require blood unless Hb falls below 6-7 g/dL. In study NC101HES maintains the intra-vascular volume of swine .

Please comment on and provide evidence that clinically relevant HBOC-201administration volumes provide adequate volume expansion in a clinically relevant largeanimal model.

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4. Measurements of tissue oxygen debt such as arterial acid base balance are progressivelyworsened in all groups following transfusion . This has been associated with poorprognosis in clinical cases of hemorrhagic shock and is difficult to explain in this modelgiven the improvements in other parameters of oxygenation.

Please provide an explanation for this paradox .

5. The model presented in study NC101 and other subsequent canine models presented inthe submission involves anesthetized animals. Inclusion of a conscious animal modelwould have been useful to assess oxygenation parameters in the absence of mechanical .ventilation and anesthetic agents.

Please comment on why a conscious animal model was not used in any evaluation oftissuelglobal oxygenation .

Study. (NC093):

6. The fact that continuous infusion of pentobarbital was used as the anesthetic may presenta problem. Typically if an anesthetic is to be used in a study assessing hemodynamicsone would specifically avoid pentobarbital . Pentobarbital may blunt the vasoreactivitycaused by infusion of HBOC-201 . Without a positive hypertensive control it would bedifficult to assess the effects of the anesthetic .

a. Please comment on why pentobarbital was used and any affect the choice ofanesthetic may have had on the study outcome as related to bemodynamies and tissueoxygenation. Previous publications by your group (e .g . L.ee, et al., J. AppL PhyJiol_

79(1): 236-242, 1995 .) demonstrate hypertension following Oxyglobin (earlierversion of HBOC-1) administration ,

b. While, it is understood that Oxyglobin and HBOC-201 different it is unclear from thedata provided how HBOC-201 affects hemodynamics in a conscious animal model .Subsequently HBOC-201 may alter hemodynamic parameters (i .e . vasoconstriction)in conscious animals, which may go on to negatively influence tissue oxygenation .Please provide evidence from a conscious large animal model that vasoconstrictiondoes not adversely influence tissue oxygenation following infusion of clinicallyrelevant volumes of HBOC-201 .

c. Also, please comment on the re levance of reporting oxygen delivery determined fromcardiac output without knowing organ blood flow . Can you please confum that thedistribution of cardiac output or blood flow is optimal to specific organs followingHBOC-201 infusion? If not, oxygen delivery and the values of oxygenationcalculated from it become less meaningful .


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Tumor oxygenation studies :

All studies provided addressing tumor oxygenation by HBOC-201 are not relevant to theapplication and should not be considered in support of the concept of adequate tissue oxygendelivery in anemia. Please comment on tumor vascular similarities to that of essentially normaltissue, which would allow for a correlation of oxygen delivery within a tumor to that of normaltissue.

Population pharmacokinetic analyses

Under the pharmacokinetics portion of the label, you indicated that a weight -based dosingapp roach would yield a more consistent systemic exposure to HBOC-201 . This approach may beanticipated to yield safer and equally efficacious clinical outcomes . However, your proposeddosing regimen is not wei t based. In your population pharmaeolahehcs ysis, c earance

dTo increase with increasing body weight, which varied over the range of 23 .4 kgto170 . 1 kg (age: 8-90 years). HBOC-201 clearance as predicted by the model was 81% higherover the weight range of patients studied. Since the impact of body weight on HBOC-201clearance maybe different between pediatric and adult populations , please perform a separateanalysis using pharmacokinetic data in adult population to examine the effect of body weight onHBOC-201 clearance . Furthermore, please determine whether weight -based dosing for HBOC-201 should be adopted . These determinations notwithstanding, as noted in question 4 underHEM-0115 (Efficacy), any dosing guidelines based on plasma hemoglobin levels would requi reconfirmation in an adequately sized and adequately powered phase 3 clinical trial . In turn,support for dosing based on plasma hemoglobin levels ould require sufficient phase 2 data tosuggest that dosing based on such a measure is safe and c y to c e cacious. Please comment.

1. Your phase I studies indicated the dependence of elimina tion half-life of H,BOC-201 ondose, but your population PK analysis did not include dose as a covariate .

Please include dose as a covariate in your population PK model to investigate the effectof dose on HBOC-201 clearance.

2. Your population pharmacokinetic analysis report is incomplete. It did not include the

final model equation and examples of its application .

Please submit the complete study report with the results of the newly requested analyses .

Phase I pharmacokinetics studies :

1 . You claim that the plasma concentration of and plasma exposure to HBOC-201(hemoglobin) are approximately proportional to dose, but no formal proportionalityanalysis has been done on your phannacokinetics data .

Please perform such an analysis using AUC vs. Dose and C,,,. vs. Dose.

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Dosing in patients with hepatic and renal impairment :

1 Your proposed indication for HBOC-201 is for the treatment of the signs and symptomsof acute anemia in adult patients undergoing orthopedic surgery . This patient populationincludes patients with hepatic and/or renal impairment, Elevations of serum creatinineand blood urea nitrogen were observed in patients administered HBOC-201 . However,the impact of renal and hepatic impairment on HBOC-201 clearance has not been studiedand the routes and mechanisms for clearance of HBOC-201 are not clearly described .

Please address these issues.

Repeat dose pharmacokinetics :

1 . You have not conducted repeated dose phirmacokinetic studies using HBOC-201 . Yo l `l am

population pharmacolinetic analysis indicated that patients who received HBOC-201pre-operatively had, on average, a 61 % lower clearance and 29% lower volume tha nthose who did not receive HBOC-201 pre-operatively . These findings indicate that

HBOC-201 involves a saturable elimination process . However, your proposed dosing

regimen for HBOC-201 is up to 5 doses in 6 days, and has not characterized for itspharmacoldnetics as repeated dose may lead to unanticipated accumulation of HBOC-201, it is necessary to characterize repeated dose hannacokineties by conducting amultiple dose -par-m;;;okinetic study.~,~p,~

`} ► ~Please submit study protocol for our comments .

Change in mean plasma hemoglobin following infusion of HBOC-201 :

1 . You have provided a table with change in mean plasma hemoglobin following infusion ofHBOC-201 .

Please also provide median with range for change in plasma hemoglobin followinginfusion ofHBOC-201 .

Otber .PharmacologylTozicologY studies

1 . The first section of your proposed label (Section 2, Dosage and Administration) describeshuman dosing in the context of both preclinical and clinical pharmacoldnetic studies . In

Section 2.2, "Additional Dose," the sentence in lines 35-37 reads that an initial dose of 60grams of HBOC-201 will result in a plasma hemoglobin concentration of approximately1 .4 g/dL, based on data from pharmacokinctic studies in animals and humans ." Pleasedelete the word "preclinical" from this language since human dosing guidance in productlabeling is not predicated on animal phannacokinetic data . Language regarding plasma


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hemoglobin levels achieved after administration of 60 g of HBOC-201 must be based onclinical data. (Please see question 4 in the review of efficacy of Study ITEM-0115) .

2. In Section 2.2 of the label, Table I entitled, "Extrapolated Dosage Guideline" is notinformative because human dosing and administration needs to be based solely on humanclinical data. As noted in question 4 under HEM-0115 (Efficacy), any dosing guidelinesbased on plasma hemoglobin levels require confirmation in an adequately sized andadequately powered phase 3 clinical trial. Human dosing based on plasma hemoglobinlevels requires phase 2 data demonstrating that this approach is safe and efficacious .Please comment

3. The language of lines 236-263 of the proposed package insert imply that the ratreproductive toxicity studies are less informative than the dog reproductive toxicitystudies for predicting human developmental toxicities because of the lack of an invertedyolk sac structure in the human fetus and a longer time interval of histiotrophic nutritionin the rat compared to the dog. Although humans do not have an inverted yolk sac, anddepend quite early in development on hemotrophic nutrition compared to other species,the histiotrophic process may supply the fetus with nutrients throughout gestation . Thus,FDA recommends that lines 257-263 of the proposed label be deleted and that moredetails are provided on the teratogenicity findings in the rat model_ We also recommendthat the rat teratogenicity results precede the language describing the dog reproductivetoxicity studies in the label.

4. Instead of Pregnancy Category "C," FDA recommends that the product be labeled asPregnancy Category "X" because:

a. The product is teratogenic in the rat

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b. FDA does not envision a situation where use of HBOC-201 is less of a risk to apregnant woman than red blood cells . Accordingly, please change the language of thissection of the label to that stated in 21 CFR 201 .57 for drugs with a pregnancycategory of "X." Please comment .

5. Please refer to lines 416-421 of the proposed label. Your contention that preclinicalstudies suggest that Hemopure transports oxygen more effectively than red blood cells isnot supported by the preclinical studies you submitted because most of the predinicalstudies do not directly compare RBOC-201 treatment(s) with autologous or homologous

red blood cell treatment(s) . Please comment.

6. Preclinical studies with HBOC-201 in the cynoznalgus model provide evidence ofcardiotoxicity. The pathologic review of the studies noted that there was "a fairly strongassociation of HBOC-201 with heart lesions consisting of interstitial fibrosisaccompanied by myocyte hypertrophy ." The findings of cardiac toxicity in theCynomolgus monkey studies should be described in detail in the HBOC- label . Pleasecomment .


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Chemistry, Manufactur' and Controls

Herd Management Program:

1. Please explain how Animal husbandry'practices (vaccines used, vaccination schedules-,anthelm inthic treatments, veterinary evaluation, and quarantine of new or sick animalsand effective housing facilities) are being ensured and documented in the housingfacilities that are providing the source herds for your product .

2. Please describe the health-screening program of source herds, including a list of agentsthat are screened, the frequency of testing, the proximity of test date to the slaughterdate and the methodologies used for testing including positive and negative controls . Inyour response, please indicate whether necropsies are performed on animals that . dieunexpectedly at source herd farms . If so, how arc results of these necropsies includedin herd health assessment?

3 . Please provide a description of the method for the assessment of "fallen stock" as wellas for any other clinical signs of disease in animals that are presented at the abattoir forblood collection. Please explain any exception with regard to the exclusion of "fallenstock" and animals with clinical signs of diseases as source animals .

Blood Collection :

Please provide information on the type of dissection equipment that is used to isolate thejugular, its method of sanitization, and whether such equipment is single use or shareduse among animals- Furthermore, please describe procedures used in dealing withaccidental contamination by brain matter during the captive bolt process, and accidental lcontamination by the contents of the rumen following the hoisting of the animal .

2. For general guidance, we have previously provided you with a list of Core CattleDiseases that the Agency uses as species-specific agents of concern when bovine-derivedmaterials are used for human biologicals production.

Transmissible spongiform encephalopthfes (TSE) :

1 . The performance of your TSE clearance studies provides some assurance of safety,however if TSE agents were discovered in source cattle for this product, these studieswould not necessarily support release of the product . Additional studies may berequested by FDA in the future, as improved models for blood TSE infectivity aredefined, when more is known about blood infectivity in bovines, and as assays areimproved. Any safety claim with regard to TSE's in the package insert, must note thelimitations inherent in the current validation studios including potential differencesbetween TSE infectivity in blood of an infected animal and that of brain homogenates .Please comment.


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Process Validation:

Please explain the discrepancies with regard to the concentration of IgG afterultrafiltration stage I and II and that ofpost-final filtration (Tables 2 .5 .4 .1 .2.6 and2.5 .4.1 .2.7, Page 3150) of C-500 intermediate . The data show an increased concentrationof IgO after second filtration, whereas a decrease in the concentration is expecte d

2. Please explain the rationale for the change in IgG specification for C-800 from <15.6ng/ml in 1997 to 525 ng/ml in 2002 (Page 3153) as an indicator or parameter forpurification.

3 . Please explain how the deviation with regard to elevated OxyHb was resolved in C-800PQ studies (Table 2.5 .4.1 .4 .5, and Table,2 .5 .4 .1 .4 .6, Page 3161-2) . Please providecomplete deviation investigation reports with supporting data. It appears that increase inthe % oxyHb has been a frequent occurrence, as demonstrated in the course of processvalidation. Please explain .

4. Please explain how the deviation with regard to low total Hb concentration was resolved(Table 2.5 .4.1 .4.11, Page 3164).

5 . Please note that specification level for Boron concentration indicated for diafiltration step(DFA), as "post-diafiltration less than pre-diafiltration result' is unacceptable,considering that the limit of this compound may range from 600 ppm to 2 .9 ppm. Pleasespecify a numerical value for an upper acceptable limit of Boron, following diafiltration,and explain the rationale for choosing the specified limit.

6 . Following diafiltrat ion against DFC and concentration of hemoglobin, you have specifiedthe pH of the final solution as < 9 .0 at 20°C (Table 2 .5 .4 .1 .4 .12, Page 3165) . Pleaseexplain what would be the acceptable lower limit for pH at this stage . In your response,please provide data supporting your rationale for the specification .

7. You have indicated that the bands that arc detected between 66 and 22kD in SDS-PAGEanalysis of Hemopurc arc likely to be stabilized hemoglobin subunits and not plasmaprotein impurities . Please provide characterization data to support your conclusionregarding the identity of these bands .

8. Your viral validation studies of the ultrafiltration step used in purification of C-500compound was performed prior to recent changes in your process . Please providevalidation data to establish the relevancy of the scaled-down model, used in thisvalidation, to the current purification conditions indicated for this step . In addition, youhave indicated that you could not successfully produce three batches of C-500 for thevalidation of the scaled-down ultrafiltration step . In your response please providecompleted validation data for this step .

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91 Please provide validation data demonstrating that the of the lOOkD FractionationUltrafilter from Pall Filtron Centrasette open channel filter to pall Filtron MaxisetteFilter, would not alter viral clearance capacity of the filtration step . In your evaluationplease consider the following parameters : changes in flow rate, filter conditioning stepand change from constant diafiltration volume process to constant retentate hemoglobinconcentration process .

Product Characterization :

1 . Your current measurements of oxygen dissociation equilibrium (i .e., Pso values) of thefinal product, using the Hemox-Analyzer are not based on complete oxygen saturation ofhemoglobin, but rather are derived at approximately . 80% saturation. Therefore thesevalues do not reflect the actual Pso of the test article . Please provide corrected Pso values,taking into account the level of oxygen saturation in the test article. Both the correctedvalue of Pso as well as the calculated oxygen binding cooperativity (Hill coefficient)should be included in the final product specifications .

Please note that we reserve comments on "mechanism of action " of this product asdescribed in your label until these issues are resolved.

2. The functional assays, used for the characterization of your product, arc limited tomeasuring oxygen dissociation equilibrium parameters mentioned above. Please expandon these functional characteristics of HBOC-201 by determining the dependence ofoxygen binding on pH (Bohr effect), chloride (Ct) and temperature .

3. Since HBOC-201 is composed of several molecular weight species, some understandingof the contributions of individual molecular species to the overall oxygen affinity (Pso)and cooperativity of the product should be established. Accordingly, please evaluate thecontributions of individual molecular species to the overall oxygen affinity andcooperativity of the product and report these results to the BLA.

4. Your data indicated that Lot H6C014 had low total hemoglobin concentration and highP50 value . Please explain these results, and comment on a possible relationship betweenP$0 measurement and hemoglobin concentration, including the effect of total hemoglobinand hemoglobin species such as methemoglobin (MetHb) .

5. Carbonic anhydrase (CA) is the only impurity found in the C-500 and C-800intermediates as detected by SDS-PAGE, immunoblotting and isoelcctric focusingtechniques. Other possible impurities, speci fically rod cell enzymes (i.e., superoxidedismutase and catalase) or'their fractions should be detected by mo re sensitive methods .Accordingly, please present data about impurities from more sensitive assays such as, butnot limited to immunoaffinity chromatography (see for example, Privalle et al., FreeRradic Biol Med 28 :1507, 2000)

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Stability:

Final product stability data indicate an apparent temperature-dependent increase in thehigh molecular weight fraction over time (>500 kD) . As a case in point , it appears that atthe 25 °C storage condition the high molecular weight fraction (>500 kD) will exceed itsspecification limit (<15%) prior to the proposed 3-yr expiration (Page 6697-6705, LotsH01C03 - HO1C11) .

a. Please explain the apparent temperahua-dependent increase in the high molecularweight fraction (>500 kD) over time, and its potential impact on your proposed shelflife for the product at 25 T.

b. Please provide updated stability data for final product lots manufactured in .2002 and2001 .-

2 . You have indicated that a two-column high performance size exclusion chromatography(HP-SEC) system (YMC-S, QT-0541) will be used to determine the molecular weightsize distribution of final product instead of the one-column system (BioRad BioSil, QT0394) . Used in previous analysis.

a . Please provide complete validation studies for the newly developed HP-SEC method,and explain the rationale for implementing this new methodology.

b . You have indicated that the high molecular weight species (>500 kD) are not resolvedusing the newly developed two-column UP-SEC system (YMC-S) . Please explainhow the high molecular weight species will be measured in the final product .

c. Please provide data to demonstrate the comparability of molecular sizedeterminations obtained using the one-column HP-SEC system (BioRad BioSil, QT-0394) with those obtained using the two-column HP-SEC system (YMC-S, QT-0541). In your response please indicate how the use of two different systems, overtime, will effect the interpretation of the stability data with regard to the molecularsize dete mination.

3. The final product release specification for N-acetylcysteine (0 .13 - 0 .22%) differs fromits specification for the stability of the final product (0.02 - 0.22%) . Please explain whyis stability specification lower than release specification for -N aeetyleysteine .

4. Please measure the degree of autoxidation (i .e., methemoglobin formation) of finalproduct at different temperatures (i .e., 5, 25, and 370C) once it is removed from the innerpouch. For a given lot of the product, please compare these measurements at thebeginning and at the end of the product shelf life .

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5. Please include the measurement of free iron/chelatable iron in the final product as anadditional product release specification and as a stability-indicating test, to assess andmonitor potential product degradation.

6. In- process testing of phospholipid content was conducted in the m anufacturing of C-500qualification lots . However, this measurement was discontinued in lots that have beenmanufactured subsequently . Pease note that phospholipid content is considered a criticalmeasure of purity for this intermediate , and therefore its determination should beincluded as a final release test for the C-500 intermediate

Ste'Package Inserts : &4ve

We reserve comments on the labeling issues for the package insert until the BLA is ""'''`i~~ ..otherwise acceptable .

Preapproval Inspection:

1 . Inspectional issues from the February 3 through 7, 2003 and March 17 th rough 27, 2003 W- '- -9pre-approval inspection have not been resolved. ~-A

You may uest a meetin 'th CBER to discuss the above s s for royal . Please request e •them at east 15 days prior to e propose meeting date. . Alternatively, you may choose pto discuss this xna er via a to ephone call . Should you wish this meeting or a telephonediscussion please call Mr. Franklin T. Stephenson in the Division of BloodApplications at 301 -827-3524.

Within 10 days after the date of this letter , you are requested to take one of the following actions:(1) amend the app lication; (2) notify us of your intent to file an amendment or a new submission ;(3) withdraw the application; or (4) request an opportunity for a hearing on the question ofwhether there are grounds for denying app roval of the application . In the absence of any of theabove responses, CBBR may initiate action to deny the app lication .

Please note our reviewclock has been suspended with. the issuance of this letter. Note also thatany amendment should respond to all deficiencies listed and that a partial reply will not beconsidered for review nor will t ie review c oc c e reactivated until all deficiencies have beenaddressed. Wglt

Sincerely yours ,

BTolding,1M.D .Director,Division of HematologyOffice of Blood Research and ReviewCenter for Biologics

Evaluation and Research


BP 00177

Exhibit C



F I N A L T R A N S C R I P T

Event Transcript

BPUR - Q2 2003 Biopure Corporation Earnings Conference Call

Event Date/Time: May. 22. 2003 / 4:30PM ET

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C O R P O R A T E P A R T I C I P A N T S

Doug SalesBiopure Corporation - Director of Corporate Communication

Tom MooreBiopure Corporation - CEO

Ronald RichardsBiopure Corporation - CFO

C O N F E R E N C E C A L L P A R T I C I P A N T S

Dr. McNealYates Capital Management - Analyst

SafnaThink Equity - Analyst

Richard KempSalomon, Smith Barney - Analyst

Gab HoffmanCapital Management - Analyst

Hugh BradfordInvestment Corporation - Analyst

Steven MaxBleuridge Capital - Analyst

Thomas FelibaNortheast Industries - Analyst

Richard AdamsBennett Moran - Analyst

Robin BrooksMRA - Analyst

Kurt WayneWest Broadway Partners - Analyst

Dr. FigmanPrivate Investor - Analyst

P R E S E N T A T I O N

Operator

Good evening. My name is Denise and I will be your conferencefacilitator today. At this time I would like to welcome everyoneto the Biopure second quarter 2003 conference call. All lineshave been lids on mute to prevent any background noise. Afterthe speakers remarks there will be a question and answer period.If you'd like the ask a question during this time, simply pressstar, then the number 1 on your telephone keypad. If you'd liketo withdraw your question, press star, then the number 2 onyour telephone keypad. I would now like to turn the call over

to Doug Sales (ph), Director of Corporate Communication goahead, sir.

Doug Sales - Biopure Corporation - Director of CorporateCommunication

Good afternoon, everyone, and welcome to our second quarter2003 conference call for the period ending April 30th. Todaywe'll report our financial results for this period and briefly discusssome of the company's accomplishments and activities afterwhich we'll answer a few questions. Before we begin, I'd lookto point out that during this call we'll make projections andother forward looking statements which involve risks anduncertainties that could cause the company's actual results orperformance to differ materially from those projected. Thecondensed list of these respective factors appears at the end oftoday's financial results press release which you can access onthe internet. In a more comprehensive discussion occurs on ourSEC filings and Biopure.com. At this time I'll turn the call overto our CEO Tom Moore.

Tom Moore - Biopure Corporation - CEO

Good afternoon, everybody. I'm joined this afternoon aroundthe table here besides Doug by Howard P. Richman our SeniorVice President of Regulatory and Operations. And RonaldRichards our Chief Financial Officer and Business Development.As we have in our past two quarterly calls I'll simply touch onsome of the key point that are raised in the press release we setout about half an hour ago, and then throw it open to yourquestions. Overall we feel we have had a very satisfactory secondquarter, very satisfactory because it was a strong revenue quarter.We saw a significant drop in operating loss compared to a yearago. The company has achieved a much stronger cash positionthan we were at the end of last quarter.

We're seeing continued growth in military support for ourtrauma development activities, and we continue to be veryhopeful of an DFA response on our by oh logic licenseapplication by mid-year or sooner, and we continue to not beaware of any major issues with that application at this time. Tothe details in the second quarter we showed a net loss of $11.7million. That was down 8% from $12.7 million a year ago. Onan EPS basis we showed a loss of 35 cents per share. That ismodestly below the analysts' projections and compares to a losslast year of 49 cents per share. Revenue is a very strong $2million compared to $928,000 year ago, and this was entirelyon our Oxyglobin (ph) product.

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F I N A L T R A N S C R I P TBPUR - Q2 2003 Biopure Corporation Earnings Conference Call




We'll -- at the call last quarter I was asked to give a roughestimate of how much we would ship is this quarter and Iestimated between one and eight quarters and two and a quartermillion and we came in smack dab in the middle of that range.We're looking for continued growth on Oxyglobin based onstrong orders now into this quarter and we in toned introducea new 16 millimeters smaller size which will make our producteasier to use with smaller docks and we show that will favorablyon our shipment results for Q3. From a cash standpoint, at theend of Q2 we had $15.1 million in the bank. That comparesfavorably with $9.5 million at the end of Q1. Since the end ofthe second quarter the company has raised an additional $7.3million, and so that has strengthen considerably our cash positionversus the Q2 final number.

Touching on other points, in our last quarterly call I said thatwhile we are continuing to negotiate with our far easternpotential joint venture partners, that those negotiations, whilestill active, had slowed down. They continue now, and theyare, in fact, still active, but we have not yet achieved a finalagreement, but those discussions are, in fact, still active.

Last quarter I also indicated that we anticipated additionalmilitary support beyond the then $4.9 million that have beenappropriated so far in the past quarter we in fact concludedcooperative research and development agreement with the U.S.navy which has enabled another $4 million to go and is insupport of our trauma trials. I'm also making a point that wehave already seen the beginning of the appropriation process forthe coming federal fiscal year. I'll point out that the house armedservices committee reported an authorization of $10 million foradditional Humiglobin (ph) research split between Army andNavy researchers. The authorizes process is only the first stepof a very long process of giving a final federal appropriation,buts it nevertheless is a good start, from our perspective, at least.

In our call last quarter we indicated we were hopeful we wouldhave a Sumter agreement in hand or be still closer. As yet, weare still working to conclude the financing on that agreement,and while it's -- those are very active discussions, it still slightlynow that we won't get that all done until probably when wehear back from FDA. On FDA, I'll just reiterate, I guess, at ourlast quarter we said we were hopeful we would hear by mid-yearthat we had gone through an extraordinarily extensive set ofinspections and had answered all FDA questions and we wereunaware of any major issues. Fundamentally we're in the sameplace now.

As many of you know, under Produfa(ph) the objective, notthe obligation of the agency would be a response within ten

months from our initial submission in eight months ofacceptance. That would lead to a potential timing in early June.We continue to say we are not aware of anything that wouldcause undue delay, but we're saying we're hopeful we'll hear bymid-year. So that's sort of a broad overview. A couple of otherimportant additional points, over the last few days there has beena considerable consumer concern and general concern aboutthe discovery of an infected cow in Canada, infected with BSE.It seems reasonable to think that for some at least that are notfamiliar with very high quality and purity standards applied toour product, that there might be some concern that that mightrelate to our product in one way or another.

I'll reiterate what we shared with investors repeatedly in thepast. Our pure buy case process has been extensively reviewedby regulatory authorities both here in the U.S. and in Europeand we have been repeatedly certified as being capable ofremoving a wide range of pathogens, including those whichcause BSE. At this point we're not aware that that is any issuewith any regulatory body worldwide. And we are now shippingproducts in three continents and none of them have ever raisedan issue about this following certification. Most recently theEuropean director for the quality of medicines granted Biopurea certification of suitability for Europe for both Oxyglobin inJuly 2001 and Hemopure in February 2003. That followed anindependent analysis by experts which we provided technicalinformation about our manufacturing process, our raw materialorigins, palo-traceability (ph) auditing and risk analysis and afterreviewing all this and our process don't colluded that we havemore than adequate safety with regard to TSE agents and metall the standards that are required in Europe for new andapproved human and veterinary medical products.

For those of you who want to learn more about this we've putadditional information on our website I would encourage youto access it at Biopure.com, and I think you'll find yourself fullystead by the additional technical detail we provide there. Oneother business note, in South Africa we've made some progressbut not progress consistent with what I would have hoped for.On the plus side, we have succeeded in getting reimbursementfrom three additional insurance companies getting ourselves tothe marketing platform where we can indeed do business;however, after what all investors will sympathize about a hardtime getting that commercial operation to get to the sales point,albeit with a late start, we've concluded that our partner in SouthAfrica is not one with which we wish to continue, and we havenotified them that we are dissolving that business partnershipand henceforth will cop operate it through our fully ownedcompany which has already been set up, is staffed, and isoperating in South Africa. We expect that handover to come







in the next 30 to 65 days, and in that, during that interim timeit will be unlikely we'll realize any additional South African sales,but after that we we look forward to at last getting into therevenue column.

Finally, I draw your attention to a conference that we're goingto be holding on Friday, June 6, through Sunday, June 8. Thisis a symposium that will be held at Turnbery(ph) Island inFlorida entitled Clinical Experience with Hemopure(ph) newtherapeutic approach to tissue oxygenation. We will be bringingtogether over 40 attendees drawn from the United Kingdom,United States and South Africa, including the President ofAmerica's blood senators and the senior medical officer of theAmerican Red Cross, representative from the Navy and theArmy, a cross-section of thought leaders in anesthesia, orthopedicsurgery, trauma surgery, hospital, pharmacy, and critical care,all to review the clinical trial results with Hemopure as well asthe complete safety record of our clinical program, to lookforward as to how our product could be applied in use withorthopedic surgery but also looking forward to update thesecritical thought leaders on our clinical plans and trauma andother future indications for the product. That's going to representa major coming-out party for the product, and will representthe kick-off of a consider reply strengthened medical educationand communication program for the product.

These meetings will be followed one a presentation on June13th at the American society for artificial internal organs andon June 14th with an open symposium at the network foradvancement of transfusion alternatives. In short, our profile isgoing to go up considerably beginning in early June. That's mysummary of where we stand. Now I would welcome yourquestions.

Q U E S T I O N S A N D A N S W E R S

Operator

At this time, if you'd like to ask a question please press star, thenthe number 1 on your telephone keypad. We'll pause for just amoment to compile the Q&A roster. Your first question comesfrom Dr. Wall as.

Dr. McNeal - Yates Capital Management - Analyst

This is Dr. McNeal. I'm a private investor. I'm working throughYates Capital Management. My question is if the FDA sets alevel that doesn't permit Hemopure to be used in the United

States, what about some of these other countries that have morerampant AIDS situations, potential India, China, Russia? CanHemopure, even if it is not set up to be used in the U.S., canit be used in these other countries? Are there any thoughts aboutthis?


We are working on additional international filings. We are inconversation with thought leaders located both as individualdoctors but also members of transfusion services and the militaryof several different countries, and we believe long-term thereis a very substantial market for our product worldwide. We havesaid that we intend to make additional international filings thisyear, and we will. Does that answer your question, sir?

Dr. McNeal - Yates Capital Management - Analyst

Yes. Thank you very much.

Operator

Your next question comes from of Safna(ph) of Think Equity.

Safna - Think Equity - Analyst

Hi, Tom, how are you?


I'm well, thank you.


You know, just a couple of questions, if approved on June 1stI just wanted to get an overview of what do you people plan todo next and how do you people plan to rule out the product?


Well, we intend to first resume breathing. This is a top corporatepriority. We will fix our tissue profusion which comes fromholding our breath for at least two weeks. Having finished that,from an investor standpoint, we will be holding for our investormeetings and then for analysts full R&D updates in the few daysfollowing this hoped-for happy event, and designed to get a lotof people haven't been quite in sink with the story up to speed.







From a commercial standpoint, we have already drawn up anintroductory plan which will be based on careful targeting ofthought leaders in orthopedic surgery and anesthesia in generalbut especially those who are leaders in the practice of bloodavoidance and blood avoidance surgery, as we believe the initialmost attractive application of our product from both aneconomic standpoint but also patient comfort standpoint is inthis particular segment of the field. Our estimates suggest thatit's in the U.S., it's a market in excess of $300 million and forthe limited capacity we will have for the first two for three years,that represents an attractive way for us to introduce the product,so you will see us begin literally, our thought leader work willbegin the end of that week.

We hope that will have a tremendously enthusiastic kick-off tothat meeting and move from there, and as I've already sharedwe'll have very aggressive thought leader contacts throughoutthe month of June, more specifically, though, on a triple handfulof targeted hospitals where we aim to get accepted first, workwith the thought leaders there to begin what we call seedingtrials, and then follow up with a combination of medical scienceliaison and sales support to basically make ourselves part of thefundamental practice within these key hospitals, and then expandout from there. Our aim will be to have the product, again,assuming we get approved, on or about June 1st to the endbusiness and moving product no later than October 1st.


And just an update on South Africa, when can you expect tosee revenues there?


Given the changes we've decided to make in our partnership, Ithink now it's realistic the think that we won't be able to dothat until probably the tail end of Q3 or more likely early Q4.By that I'm saying basically August.


August?


Yes.


August '04?


'03.


August '03. Okay. Thank you.


Thank you, Safna.

Operator

Your next question comes from Richard Kemp of Salomon,Smith Barney.

Richard Kemp - Salomon, Smith Barney - Analyst

Good afternoon, gentlemen.


Good afternoon.


I represent several investors, and one question is can youcomment on any recent inquiries by the FDA. And secondquestion would be where are we in future production capacity?There was some discussion --


In terms of your first question, we're in dialogue with FDAliterally two for three times a week, and so they are reasonablyconstantly asking questions, asking for additional information,so I'd say the commentary, we've been in fairly constantcommunication with them. In terms of added capacity, ourfacility in Cambridge, Massachusetts currently has a rated capacityof 70 to 75,000 units annually. As we've announced previously,our aim is later this year, is to expand that capacity to, in theballpark of 90 to 100,000 units maximum capacity.







Under our current plans that's all the capacity we would haveuntil likely now earlier 2006 when this new facility in Sumterfor which we've already done the site acquisition and theengineering ought to be complete, validated, inspected by FDAand then up and running.


And how large is that capacity?


Good question. I'm sorry. I didn't say that. 500,000 units peryear. I'll note that the site is also designed to be able to mirrorover a plant, and so we can put basically a million units annuallyof capacity out at the Sumter facility once we other theconstruction of the mirror plant which will be less expensivethan the original facility.


And the expected revenues per unit is $800? Is that what Iunderstand?


I don't think we've ever given more than general guidance inthat area but I won't discourage you from thinking about thatnumber.


Thank you very much.


You're welcome.

Operator

Your next question comes from Gab Hoffman of CapitalManagement.

Gab Hoffman - Capital Management - Analyst

Just think about it.

Operator

I do apologize for that. Mr. Hoffman, if you would please pressstar 1 again. Please hold for Mr. Hoffman. Go ahead. Sir.


Hi. Thank you for taking the question. I was curious, wouldyou mind telling us who the three insurance companies thathave, in South Africa that have, you know, startedreimbursement for Hemopure?


I wouldn't mind at all, but I don't have their names in front ofme. I would be happy to contact you separately with thatinformation, in any way you like. I'd be happy to send you thatinformation.


Okay. Sure. I'll take that off line. Other question regarding the,you know, capital raising. It's certainly impressive that thecompany has been able to strengthen the cash balance over thelast quarter and I was just won regular a little bit about themethod with respect to how it's done. Some companies, asyou're probably aware, put specific provisions in these, youknow, in their agreements with the investors that specificallyprohibit these investors from shorting the stock first and thereby getting an arbitrage from the discount to which, you know,to the market at which they buy the securities, and I waswondering, has Biopure specifically done that, you know, toprotect the common, you know, the current shareholders.


Yes. We have not done that with the fund raising that we'vedone in this calendar year. What we have been able to do is asthe company has strengthened its finance position, is toprogressively reduce the discount at which the stock is sold, andso a significant amount of the money raised since the end of thequarter has actually been through sale of the stock directly intothe market for which we're basically only paying a 1% handlingfee, so -- so at this point we're now raising money at a veryminimal discount.

I will say that if you look at all the money raised from -- sincethe beginning of the year, I'd say the average discount that we







have been forced to provide in order to conclude a transactionhas probably been on the order of 15%, but the more recenttransactions have been for significantly less than that, and franklyso long as we can continue our financial health and obviouslyin the context where if we get positive news from the Food andDrug Administration, I think we will be able to avoid thosekind of activities which certainly can go on.


So in the future you haven't , at present but in future if thecompany is in sponger financial shape you anticipate buttingLang Kang ever Wang specifically that prevents arbitrage fromcoming in and shorting the stock first and profiting in that way.You know, instead you'll be able to ensure that the peoplesubscribing to the agreements are real investors, as it were.


Yes. Though I have to say it depends, of course, on the structureof the particular financing. The financing we've done of late hasall been with shelf stock, fully registered stock, and it's verydifficult to put those kinds of provisions on shelf stocktransactions but I agree totally with the spirit of what you'resaying, namely, going forward from here we ought to be in aposition where we minimize that kind of activity. If we can dothat contractually, we will attempt to do that. I'm happy that atthis point we're not rally selling stock at a discount anymore.


Sure. So the most recent investors, has that been disclosed, whothey are? Sometimes companies issue press releases, you know,when the financings are done and specified who the in investorsare at that time. Do we need to wait for the registrationstatements to see that?


I'll let Mr. Richards address that question.

Ronald Richards - Biopure Corporation - CFO

Yes. In this case what we would do is if we did a pipe transactionwe would definitely disclose all the investors because there is asubsequent statement for them but since these were all donepublic offers, they were and you take downs off of a shelf those

investors was you typically don't in ah public offering howeverwe've worked very hard to try to find in investors that webelieve do have a long-term interest in the story. We can't alwaysguarantee that and as you well know sometimes you think peoplewill hold don't and people you don't think will hold do. I thinkwe have a good group of investors to the most part and if youlook at the way the volume it I had that, it suggests that a goodamount of the stock did hold.


But you can't actually say who those investors are.

Ronald Richards - Biopure Corporation - CFO

No, no, we can't in this particular case because in a publicoffering it generally doesn't get disclosed. Right.


Okay. Great. Thank you very much.


You're welcome. Or not again, if you'd like to ask a question,please press stash then the number 1 on your telephone keypad.

Operator

Your next question comes from Hugh Bradford of BradfordInvestment Corporation.

Hugh Bradford - Investment Corporation - Analyst

Good afternoon.


Good afternoon.


I have two questions. Two of our associates are surgeons, andin their recent conversations with Parkman medical center here,which is a trauma hospital, as you are aware, the tests that theyhave been using the product have been all satisfactory. I don't







know how many other trauma hospitals are using, but have youexperienced any negative reports? The second question is hasthe product been tried in a recent war overseas?


Very good. Let me answer both questions. Parkman Hospital isgoing to be our initial clinical center to conduct the alreadyannounced in-hospital trauma trials that will set us up forsubsequent pre-Hospital trials to establish an additional traumaindication for Hemopure. And much of the military, all themilitary support that we've received to date has been design tohelp finance those trials.

So park land is an important partner for us in that. To the bestof my knowledge, and I think my knowledge is pretty darngood, they're not currently using that product, and it may be inyour conversations you talked to surgeons who haveexperienced, participated in earlier orthopedic surgery trial orin some other way have some experience with the product,duty I but I have to say for the record and also for the sake ofour regulatory friends, we have not initiated that trial in parklandHospital.

But I'm glad the surgeons feel comfortable about the productregardless of how they got that experience with it. When weget the trial underway, we'll be using a number of clinical centersin the U.S. and expanding them aggressively as well as using,running the trial else where around the world. But that trial hasnot yet begun. In terms of overseas usage, Biopure has not soldproduct to the U.S. military for the purposes of having it usedoverseas, and so we are not aware of specific military usage ofthe product, and so as far as -- we've never been formallyinformed of our product being used.


Thank you.


You are welcome.

Operator

Your next question comes from Steven Max of Bleuridge (ph)Capital.


Hello, Steven.

Steven Max - Bleuridge Capital - Analyst

Hey, Tom, how you doing.


I haven't seen you in the longest time.


I've been hiding, I guess. Question for you on South Africa.How many units were left out of the, I think it was thousandthat you got or 1,000 or 2,000 that you guys shipped over, howmany units were left when you terminated the contract? Andcan you just give us -- I jumped on the call late. I don't knowif you spoke about any more details on what transpired to thearrangement being terminated.


So we terminated the arrangement. We're actually continuingto make free product available out of those 2,000th store thatwe've put over there. And my understanding is roughly 1,000units have been consumed to this point.


Okay.


But we intend to continue to make the product available onthat free basis. We simply have to create this new commercialarrangement before we can go back, go into revenue-generatingoperations.


And then what was the reason that the agreement wasterminated?








I think it's probably self-evident.


Okay. Thanks very much.


You're welcome.

Operator

Your next question comes from Thomas Feliba(ph) of NortheastIndustries.

Thomas Feliba - Northeast Industries - Analyst

Afternoon.


Good afternoon.


(No audible response.)


I am terribly sorry, but I can't -- you're not coming through.


I've taken it off the speaker. I apologize.


Great.


The questions about your actual manufacturing costs per unitat the Cambridge plant versus the pro forma expected costs with

the 500,000-unit capacity at Sumter. Is there a substantialdifference between the two?


Yes, this will there will be a substantial difference. Therelationship will be roughly three to one.


And is the manufacturing costs in Cambridge such that you cansell profitably?


Yes.



Operator

Your next question is from Richard Adams of Bennett Moran(ph).

Richard Adams - Bennett Moran - Analyst

Hi. as I was hoping you could just maybe give us a little moredetail to some of your more recent conversations with the FDA.I think you stated there were no major issues that have arisenand that you've answered the questions they have had, but doesthat imply that there have been minor issues and can you talkabout what those are?


We have -- in the course of the examination of our applicationwe've gotten questions about basically every part of it, so it's fairto say that if you're looking at all the issues that can get discussed,we get questions about everything from our manufacturingprocess to the way we manage our herds, to the standard clinicalquestions, requests for reanalysis of data and all the rest, and sothere's a pretty, you know, a pretty broad range. We even getquestions about how we're going to market the product.







We're in negotiations over brand names and everything. So Idon't mean -- I guess I mean to convey accurately to you thedialogue is very broad and very intense. It's hardly cursory. It'sfair to say that we've been asked about everything.


Have you received complete clearance on the manufacturingyet?


We have -- we have in a sense that all the inspections arecomplete. We have responded to all the questions and all theissues we raised. The inspectors who send us those key questionsrepresented to us that the questions raised were ones which withsatisfactory verbal answers, were adequate to have our facilitiesapproved for manufacture of the product, and so it is our -- Iwon't be definitive about when FDA is going to give us ananswer to B 11A. I won't be definitive about what I think theanswer will be. But I will be definitive and say we are quiteconfident with the FDA is satisfied with our ability to producethe product.


And sorry if I missed this, but did you say that you would expectto launch roughly four months after approval assuming you wereto get approval in mid-year?


Yes. So I'll be honest with you. Because of our long-termreimbursement strategy, assuming we got approval, we woulddo everything we can to be in business on June 21st. When youlook at drown the road. That factors in a very significant dateto hit.


Okay. Thanks.


You're welcome.

Operator

Your next question is from Robin Brooks of MRA.

Robin Brooks - MRA - Analyst

Hello. I have a comment and a question. The comment is couldyou put the names of the South African insurance companiesthat are reimbursing on the website so all of we investors couldfind out who those are.


I'd be happy to do that.


Good. And my second question is has to do with how do theRed Cross and blood banks view Hemopure? Is itcomplimentary to what they do or a competitor?


I'm happy to say that, while I don't want to put any words intheir mouths, per se, we have met with very high level people,in both organizations. It's fair to say that they feel we arecomplimentary. It's even fair to say the down -- there are manythere who feel strongly that down the road, if and when we getapproval to our trauma indication, that we in fact willsignificantly build demand for red cells because they believe wecan contribute to the survival rate of those who actually get tothe hospital in order to get their transfusions, so I'm happy tosay that at this point the, as you know, the blood bankingcommunity has two very large organizations which togetheraccount for roughly 90% of all transfused blood, American RedCross and America's blood centers. I think it's far to say that weare having good communications with both and our aim is towork well with both, both because we think we are, in fact,complimentary and besides that, until we get to capacity of 6or 7 million units we're not exactly the world's most fiercecompetitor for if wiping out the red blood cell bank anyway.










You are welcome.

Operator

Your next question is from Kurt Wayne of West BroadwayPartners.


How are you today?

Kurt Wayne - West Broadway Partners - Analyst

I'm a little surprised at the press release you all put out today.(Inaudible)


I am sorry, but you're not coming through. Maybe thatspeakerphone problem again.


Okay. Is this better?


Yes, much better. Thank you.


I was a little surprised at the press release you put out onOxyglobin. I was kind of wondering why you felt the need todo that. Did you receive a number of calls regard than mad cowor was it just a maneuver?


Actually, we have not received a single call from either aveterinarian or from an investor concerning this issue. But wemade the press release because, as we observed how the stockwas performing over the last two days, it seemed -- it seemedpossible, particularly that investors who are not particularlyfamiliar with our company might be somehow reacting to thatnews and making an association with us which, based on our

-- on the standards of how we manufacture the product, wasn'tjustified.

I'd add to that also we haven't heard from any governmentalagency or health agency of any kind, either, so in point of fact,a confession here for you, we made this release even thoughthere was no internal issue. We made the release based on thefact that when we observed the changes in our stock price, it isseemed reasonable to conclude that for one reason or anotherinvestors were associating our product with this issue. For thoseof you who enjoy thinking about how stock moves, I'll pointout that within 45 minutes after we issued the press release, thestock had recovered by about 40 to 45 cents.


Okay. You know, I think I know enough about the productwhere I didn't even really associated the two, so it was surprisingto me, but I think it was a good idea, in retrospect. Is there away that you could put out maybe a more educational releaseor section on your web site that would somehow go into moredetail?


That's an excellent idea, and in point of fact, we have done that.So if you go to our web site, you'll see a more detailed technicaldiscussion, and I think we also have posted the actual certificatesfrom the folks in Europe who are known as EDQM. We haveactually posted EDQM certificates on the web site just toreassure everybody that not only are we good, we're certified .We have some of the scientific background on this as well. Forthose that are into log reductions and thing like that, as always,we're willing to respond to public demand. If you want the seemore information on that, we can post that as well. Hopefullywhat you find there is adequate.


I'll take a look at is that.


We can go into it much deeper if you're prepared to stay awakethat long.









Operator

Your next question comes from Dr. Figman (ph) .

Dr. Figman - Private Investor - Analyst

I think that's me. It's Dr. Figuman, private investor, my questionrelates to your south African market and approval for orthopedicsurgery. Did you at any time apply for the trauma indication? Iwould have thought that because of the urgency of treatmentof trauma patients and the absence of need for any kind ofmatching of blood type, that that would be a very naturalmarket. Could you comment on that, please?


Doctor, your observation is a good one. First of all, for thosewho don't know the distinction, we have a general surgeryindication in South Africa as opposed to simply orthopedic. Thegood doctor is quite right, there is a tremendous interest in theuse of our product for trauma in South Africa, and South Africawill participate in the clinical program that we are preparing toachieve that indication in the U.S., and we have already, in fact,met with the medicines control council, which is the SouthAfrican FDA, to secure the approval for initiating those trials inSouth Africa. And that's where we stand.


Would it be useful for the purposes of this conference call tocomment on why you went for the surgical, whether it beorthopedic or general indication, prior to the trauma indication?


I'd be happy to do that and then I'll try to finish it off with atrauma story just to amuse, hopefully amuse our callers. Thereason we went for general surgery was that was the indicationjustified by our clinical program conducted at that time. Theregulatory organizations of the world seem to be prettyunanimous on one point. They view trauma as a separate anddistinct indication from surgery, and so as the U.S. FDA does,the medicines control council in South Africa, we're willing toaccept surgical data as being translated over to use in trauma, so

we they have insisted that we do a separate clinical program todemonstrate our efficacy and safety in that indication.

However, because general surgery is a pretty broad base, we doend up getting used in situations which are clearly surgical butare, one would classify as traumatic as well. The most dramaticone that's occurred in this quarter occurred in South Africa. Aman working in a factory, in a pretty remote portion of SouthAfrica unfortunately got his hand caught in a machine and thehad an was severed. And left literally on the floor. He was rushedto a hospital. Which unfortunately was over 100-mile away andthey later picked up the hand which had been left at roomtemperature for an extended period of time and reunited themat the hospital I guess it was two or three hours later am duringa large part of that time the hand will had been un-refrigeratedwhich in limb attachment usually means the probable of successin reattaching that limb goes way down.

The hand, however, was in fused with Hemopure as was thepatient prior to the attempt to reattach and, in fact, they didsuccessfully reattach it and it was back to close to normal usagewithin a few days. We weren't there, but the doctors associatedwith the surgery attributed the ability to successfully reattachthis hand to the oxygenation benefits of the Hemopure product.That's created a bit of a stir down in South Africa. In point offact, the surgeon who did this was reported in the Hanesburg(ph)Star, is the surgeon who did this was giving a brief talk at amedical meeting the following weekend and he had 20 minutesto do his talk and they held it over an additional 90 minutes sohe could answer all the questions from the doctors at thatconference, so that's one of several encouraging anecdotes weget from the use of this product on a day-to-day basis in SouthAfrica . I hope that wasn't too long-winded.


It's a remarkable story and I wouldn't be surprised actually ifyour product served his severed hand better than whole bloodmight have. But I won't go into my thoughts about that thinkat this time.


I'd hate to discourage you. I'd be interested in that. Nevertheless,I appreciate your question and the opportunity to talk a littlebit about what's really going on down in South Africa.










Thank you.

Operator

Gentlemen, there are no further questions at this time. Willthere be any closing remarks?


Only a bit of whimsy. As a company, you know, we've beenat this for 19 years, and in the next few weeks will be citing onefor us no matter what. In a since we're like, I'd say we're likesinned all. We spent 19 years the ashes of preclinical researchand moving the furniture of getting our clinical trials underwayand dealing with whatever you choose to call it, the regulatorypreparation, and now, now we hope we're going to be invitedto the ball. We've got the dress on, the glass slippers are by thedoor, the pump kin and white mice have been picked out, andso we're ready to go, and if and when we get there, I think alot of folks will be surprised, but we won't be. That's it. I lookforward to talking to you sooner rather than later.

Operator

This concludes today's Biopure conference call. You may nowdisconnect.

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Exhibit D




Event Transcript

BPUR - Biopure Corporation Conference Call To Discuss the RegulatoryStatus of Hemopure

Event Date/Time: May. 30. 2003 / 3:00PM ET







Thomas A. MooreBiopure - CEO and President

Howard P. RichmanBiopure - SVP Regulatory Affairs and Operations

Ronald F. RichardsBiopure - CFO and SVP Business Development

Doug SaylesBiopure - Director of Corporate Communications


Sapna SrivastavaThinkEquity Partners - Analyst

Kirk LangGwitt Broadway Partners - Analyst

Richard AdamsBennett Lawrence - Analyst

Gabe HoffmanOccipital Capital - Analyst

Stan SetlockSilver Syndicate - Analyst

Dexter Blandprivate investor

Roberto McNulnBridger Capital - Analyst

Michael WoodFonstock Oppenheimer - Analyst

Tag VichuMoores Tabot - Analyst

Todd Sidwellprivate investor

Steve HappasDakota Investments - Analyst

Ronald RisottoWest Rock Investors - Analyst

Ken Martin HalpineEmerald Asset Management - Analyst

Douglas Sayles

Kate Winkler


Operator

Good afternoon. My name is Melissa and I will be yourconference facilitator today. At this time, I would like towelcome everyone to the Biopure Special AnnouncementConference Call. All lines have been placed on mute to preventany background noise. After the speakers’ remarks, there willbe a question and answer period. If you would like to ask aquestion during this time, simply press star then the number oneon your telephone keypad. If you would like to withdraw yourquestion, press star then the number two on your telephonekeypad. Thank you. I will now turn the conference over toDouglas Sayles, Director of Corporate Communications. Mr.Sayles, you may begin your conference.

Douglas Sayles

Good afternoon, everyone, and thank you for joining us onshort notice. Before we talk about the progress that we’re makingin the FDA regulatory process, I need to point out that duringthe call we’ll make projections and other forward-lookingstatements which involve risks and uncertainties that can causethe company’s actual results or performance to differ materiallyfrom those projected. The condensed list of these respectivefactors appears at the end of today’s press release which you canaccess on our website on the Internet at Biopure.com or youcan reference these risk factors in our SEC filings on our website.Right now I’d like to turn the call over to Tom Moore, whois going to discuss today’s news. Thank you.

Thomas A. Moore - Biopure - CEO and President

Good afternoon, everybody. I’m joined this afternoon, inaddition to Doug, by Howard P. Richman, our SVP ofRegulatory Affairs and Operations, and Ronald Richards, ourCFO and SVP of Business Development. As most of youprobably know, less than two hours ago, we received writtennotification from the Food and Drug Administration of theirintention to complete the review of our biologic licenseapplication for Hemopure by August 29th. This notification isconsistent with PDUFA guidelines which provide that theagency will attempt to get a response to us of some kind to ourapplication filed on July 31, 2002 by June 1st . The samePDUFA regulations allow for a one-time 90-day extension basedon the agency’s judgment of what’s appropriate in the reviewof our application.

We view this notification as a very position development forHemopure. First of all, we have a date which the agency hasindicated their intent to give us an action letter. Second, itconfirms what we already knew, that is, that the agency has



F I N A L T R A N S C R I P TBPUR - Biopure Corporation Conference Call To Discuss the Regulatory Status of Hemopure




devoted considerable effort to this application. And third, as wealso already knew, that now our investor community knows,there is nothing in our application which is warranted a denialof that application at the three key decisions points we’ve passedso far in the PDUFA process. By that, I mean our BLA wasaccepted, it was also continued through the mid-cycle reviewconducted by the agency, and now, at the PDUFA guidelinedate for a first response, we’ve not had a denial, but rather agoing forward to additional consideration. The added time we’regoing to get over the next three months will not only allow usto insure we can fully answer any additional questions the FDAmight choose to send our way, but also allow us to completelegal negotiations and to continue forward with the commercialpreparations we are making against a hopeful approval on August29th for the name of introducing this product on or about theOctober introductory guideline we mentioned in our conferencecall last week.

So we feel very positive about this, but quite understandably,we want to be in touch with our investor public and give theman opportunity to answer questions as well, ask questions as well,so we’re going to answer them. And to help me do that, I’mgoing to turn to Howard Richman to answer many of thesequestions. As some of you can tell, I’m suffering from a severecold coming from the non-existent strain we have in Bostonthis year. And so we’ll be sharing question and answering dutieswith Howard this afternoon. Those are our comments. We’llnow be happy to answer any questions.

Operator

At this time, I would like to remind everyone, in order to aska question, please press star then the number one on yourtelephone keypad. We’ll pause for a moment to compile theQ&A roster. Your first question comes from Sapna Srivastavawith ThinkEquity Partners.


Sapna Srivastava - ThinkEquity Partners - Analyst

Hi, guys. Congratulations on the new progress. A quick question- - did the FDA request any additional data to be submitted, orwhy do you think that basically the FDA extended the timelinefor the review process?


The FDA did not request any additional data and I’ll let Howardcomment on the extension of the review process.

Howard P. Richman - Biopure - SVP Regulatory Affairs andOperations

Hi, Sapna, this is Howard. This is what normally happens withany submission. As Tom has told the public over the past manymonths, is that we are in continued dialogue with the agencyand during that period of time, they have requested informationwhich we have sent back to them. It’s a normal process withany application. Be that as it may, the agency, during the courseof reviewing the information has the opportunity to takeadditional time to allow them to give a complete and additionalthorough review of all information to make a thoroughconclusion on application. This type of response from the FDAis very common with biologic licensing applications. Mostrecently, in 2001 and 2002, of the 11 BLAs that were submittedto the Food and Drug Administration, all 11 of them went onto the extended period of time for review which was outsidethe normal PDUFA 10 months. It is within the PDUFAguidelines to allow them to do that and they still meet theirmatrix for approval for their guidance acumen.


Can you give us any indication as to which data subset the FDAis looking at? Is it clinical, manufacturing or is it just acombination of the whole thing?


It’s really clinical data as far as we know. As we’ve sharedpreviously with the public, we believe that the CMC portionof the BLA has basically been covered. Now we could get aquestion tomorrow which would make that statement no longeraccurate but based on everything we’ve seen the CMC work iscompleted.


Okay, thank you.








Thank you, Sapna.

Operator

Our next question comes from Kirk Lang with Gwitt BroadwayPartners.

Kirk Lang - Gwitt Broadway Partners - Analyst

Hey, Tom, great news.


Thank you, Kirk.


In your Q2 release that we just talked about, you indicated thatBiopure believes it has sufficient cash to fund operations throughNovember of 2003. Was that cash on hand or was that all foryou having to utilize as standby equity agreements with themegastore capital markets?


It’s cash on hand.


Very good, thank you.


You’re welcome.

Operator

Our next question comes from Richard Adams with BennettLawrence.


Hi, thanks. I guess I’m a little bit confused on the timing of thesubmission of whatever it is you did submit to the FDA giventhat your original BLA was submitted in July 31st of last year.I guess my question is why are you still having to provideinformation to the FDA? You said mid-May there was aresubmission of some sort. Why nine and a half months afterthe original BLA was submitted are you still having to provideinformation?


It’s actually, Richard, it’s a continual process of providinginformation. I’m going to let Howard comment on thisspecifically, but it would be difficult to categorize how manyhundreds of questions we’ve answered in the review of this BLAto date. This mid-May submission was some additional analysiswhich we provided on data that was already in the BLA. At thetime, we didn’t consider it a major amendment to the BLA butthe FDA looked at that as a reason to extend it. But I’ll letHoward comment on that.


Good afternoon, Sir. How are you? Just as a point ofclarification, this is a normal occurrence. I’ve been lucky to beinvolved with 12 other approval processes outside of Biopureand this is a normal thing that happens. We’re, in fact, inconstant contact with the agency when they’re requestinginformation in real time. So this is not anything new that canhappen. And what we have done is supply responses back totheir continual questions to allow them, again, as I mentionedearlier, to give complete and thorough response to this first inclass application.


I understand there was a continuing dialogue and questions andanswers, but it would seem that for there to be some sort ofsubmission that would extend the PDUFA date another twomonths, it would have to be something material. And I guessI’m just surprised that nothing was disclosed in mid-May whenthis additional submission was made.








To be clear, we were simply responding to a new set of questionsfrom FDA. It did not involve any new data. And so frankly, itwas well within the range of other questions we’ve answeredin the past. When we made that response, we didn’t characterizeit as a major amendment to the BLA. I think the FDA chose todo that and I think that really, how do I phrase thisdiplomatically, I think that’s a way for them to get this additionalconsideration time as opposed to some startling new insight onthe application. But that’s not my role to call. I would say, asHoward has already said, so far the FDA’s extended on 11straight BLAs, so we’re number 12.


Was there any discussion about whether you’ll need an FDApanel?


No. All I’d say is, by the agency’s making their intention to givean answer by August 29th, that rules out a panel given that thenext panel scheduled, I believe, is in September. I think thedecision the FDA made not to use a panel appears to still hold.


Okay, thank you.


You’re welcome.

Operator

Your next question comes from Gabe Hoffman with OccipitalCapital Management.


Good afternoon, gentlemen. Thank you for hosting the call. Iwas just curious - - one comment that you just made that FDAhas extended on 11 straight BLAs. Whose BLAs? I’m not sure.Can you tell me exactly what you’re referring to there?


We’re referring to standard BLAs. That is, those that are notsubmitted for accelerated approval but are normal standardtiming and we’re referring to 11 BLAs submitted in 2001 and2002. And those were 11 different biologic products.


So the last 11 BLAs to be reviewed, the FDA has extended onall of them?


That is correct. Standard BLAs.


Oh, I wasn’t -- standard BLAs, okay, I wasn’t aware of that.Could you please be a little more specific in terms of - - thecompany has submitted additional analyses of previouslysubmitted data. Could you be a little more specific as to whatelements of the clinical data that that refers to?


I can’t be a lot more specific.


I mean, is it safety, is it statistical procedure, is it some auditingof patient records? I mean, could you just be somewhat morespecific?


Well, all patient records have been audited and so all that’s beendone, so that’s not at issue as far as I know anyway.


Or merely is it formatting or you know?


It’s actually - - it was a dialogue really about how to look at theclinical data. As you know, there are various analyses used to







look at our efficacy and safety data and we just had a dialogueabout the different ways you could look at the analyses that areperformed on the data. And that’s really as far as I want tocharacterize it.


But could you just give us maybe a broader ballpark sense as to- - you know, just a broad area that it is - - is there a specificarea that it’s in that’s a broad area that maybe you couldcharacterize it? That’s more specific than just it’s the clinicaldata?


Well, I mean, all the clinical data has to do with safety andefficacy. That’s the only thing in measure in these clinicals. Andso, the dialogue is over those clinical and safety and efficacy data.And again, we have answered some questions on a pretty broadbasis. When I talk about it as how to look at the clinical analysis,it’s exactly what it was. So I think that’s as far and as specific asI really want to be at this point.


Okay. Thank you very much.

Operator

Your next question comes from Stan Setlock with SilverSyndicate.

Stan Setlock - Silver Syndicate - Analyst

Yes. Assuming that you get the normal approval that’s expected,what quarter would you be looking to make a profit in?


Well, what we have shared with the investing public in the pasthas been that with the capacity we have on hand in ourCambridge, Massachusetts facility, which currently is in theballpark of 70,000 to 75,000 units per year, while we canupgrade that to the 90,000 to 100,000 units a year, even at thatcapacity, we don’t believe we will be able to register a totalcompany profit where the revenue from these sales offsets allthe fixed costs and research costs that we have planned, we don’t

think we’ll be able to reach that profit until we can upgrade ourcapacity further with the new installation we intend to open in2006.

Stan Setlock - Silver Syndicate - Analyst



You’re welcome.

Operator

Your next question comes from Kate Winkler with ShorelinePacific.

Kate Winkler

Oh, hi, sorry. Not necessarily slow line, but shoreline. Hi guys.I just wanted to ask the next logical question about the previous11 BLAs and what proportion of those were approved?


The - - at this point, and remember, some of this is pretty recentstuff, like 2002, which means they were submitted in 2002, ofthose 11, 4 have been approved, none have been rejected. Someare still in dialogue. Some are doing additional clinical research.

Kate Winkler

But has the response time passed for all of those in the sense thatthis 90 day, or are we amidst 90 days for some of those?


I believe all of those have reached the full 13 months, if youwill, of standard review period.

Kate Winkler. Okay. And so what that means now in terms offuture options based on previous precedent for you guys isoutright approval obviously still. But we’ve still got some of thissimilar potential outcomes being extending the trials orextending the review further, right?








That’s certainly possible. It’s, I think, it’s our belief that we willget a full action letter which will be more definitive than that.But that’s our belief, it’s not a commitment made.

Kate Winkler

Is there any reason why you believe that in light of the fact thatonly four have actually had that happen?


Well, that’s what be believe, so I guess we have - - we don’tbase that belief on nothing.

Kate Winkler

All right, well thanks.


You’re welcome, Kate.

Operator

Your next question comes from Dexter Bland, private investor.Dexter, your line is open.

Dexter Bland - private investor

Thomas, I was reading your statement that you submitted thatyou were pleased with the FDA’s progress and I would haveput that I was disappointed because it should have beenapproved. I mean, either it works or it don’t work and threemonths ain’t gonna change anything. So I’ve been invested along time and I was just very disappointed and I’m sure youfellas are too. .I just wanted to make that comment.


I understand. You’re absolutely right to say I would havepreferred outright approval and perhaps an investment in ourstock. Just kidding about that, FDA. But I guess as we look atthe total picture, we feel like we’re continuing to make progresson this.

Dexter Bland - private investor

Thanks a lot.


You’re welcome.

Operator

You have a follow-up question from Richard Adams withBennett Lawrence.


Hi, sorry. Just one more quick one. Are you now confident thatyou’ve given the FDA all of the information it needs to makea decision?


I guess it depends on whether the FDA should choose to ask usany further questions. And so, I feel confident that all the datarequired to make a decision is there. We may yet have somemore dialogue about that data, but we do think we have a fulland complete application.


One last thing. On the last conference call, you all mentionedthree new insurers in South Africa that were coveringChemopure. I haven’t seen that disclosure on the website. Ithink you guys said that you had posted that.


Very shortly. I’m sorry for the delay on that, but there will beno problem getting all three up there.


Can you tell us - -








We’re just back checking a couple of those things and it will beup next week.


Okay, thank you.


You’re welcome.

Operator

Again, if you would like to ask a question, please press star thenthe number one on your telephone keypad. You do have afollow up question from Gabe Hoffman with Occipital CapitalManagement.


Thank you, gentlemen. Actually, that was the question that youmay recall that I had asked on the previous conference call iswho the three South African insurance companies are. Just toexpand on the previous question about that, what is it exactlythat needs to be back checked? I mean, the company said thatthere are three insurers. That was said a week and a half ago.Why - - I mean, it’s the only market in which the product isapproved. One would think that you would have that at yourfingertips or within a near immediate period of time.


Everything you say is perfectly reasonable. I frankly was notaware that it was not yet on the site and we’ll have it on the siteabsolutely ASAP.


Okay. Could you define ASAP?


Gosh, here it is - - we’ll have it on Monday.


Okay, great. Thank you very much.

Operator

Your next question comes from Roberto McNuln with BridgerCapital.


Is there any possibility that there could be an additional extensionpast the August 29th?


Fundamentally, no. Under PDUFA guidelines, the FDA isallowed one 90 day extension. But beyond that, I mean, it ispossible but at that point they break away from PDUFAguidelines and the agency these days is not supposed to do that.


Given the fact that there’s a September 19th tentative B-Pakcommittee meeting, I just was interested in knowing whetherthat could be a possibility with say a one month extension tobe included on that panel?


We don’t think so. Based on the agency’s reaffirmation of theAugust 29th date, we think obviously what they’re saying isthat’s not in our plan.


To get some more information about the additional data askedfor - - given your assessment that the questions asked were verybroad, I’m still unclear as to why then at this late in the date itwould require a three month delay. I would understand if thequestions were very detailed that the FDA would ask for - -would take that additional time. But your assessment of thequestions being very broad makes me want to get some moredetail about that.








I think - - well, I guess the question is, the FDA chose to lookat this as a major amendment to the BLA. That’s sort of adecision they make which allows them those three months ofextra time. I don’t know whether or not - - and it’s also standardprocedure that they - - if we submit new information about anyaspect of the product or new analysis about any aspect of theproduct, whether it’s pivotal to their decision or not, they candecide that that’s a reason to go for the extension. So I’m notsure whether or not the data we submitted, we did not submitany new data, whether that was a reason for the extension ofwhether the echo simply needed an extension, period.


When did the FDA make that request for the information thatresulted in the extension?


Well, again, you’re making the connection that the informationwas the reason for the extension. I’m not sure whether that’sthe case. But the request for that information was about May1st.


About May 1st. Okay, thank you.

Operator

Your next question comes from Michael Wood with FonstockOppenheimer.

Michael Wood - Fonstock Oppenheimer - Analyst

Gentlemen, good job. This is Michael Wood. How are you?


Thank you, Michael. We are well and we hope you’re well.


Well, I am, and I’ve just got to know your company over thelast 6 or 8 months or so and I’ve been talking to people inside

and outside. My question is this - - out of the people that arein the room on your side that are listening, how many peopleexpected them to pull the extension for three more months? Isthere anyone on the management team that thought that mighthappen?


I think, first off, I haven’t polled the room, so we may go aroundright now and do it. I think Mr. Sayles, who is always apessimist, probably would have bet on the extension. I thinkit’s fair to say we knew that was a possibility. The FDA, as weshared, the FDA sort of indicated to us that they were aimingto give us a full and complete review within the PDUFAguidelines, but at no point does that obligate them. Howard,do you want to give me your point of view?


Yeah. It’s not surprising, basically, because the information hadbeen colleted over the past year since the submission andsomething of an understandable lull. This is the first electronicBLA Sever has ever received and quite high in volume and thedata is in many places to review and it does take a lot of workto get it done. Because our most recent submission to themfrom the beginning of May, as Tom mentioned, it providedthem with some new analyses that they had requested to helpin their review cycle.


Okay. It seems to me that if they wanted to reject the productat this point in time, it would have been easy for them to havejust done it toady or Monday. Is that true?


Yes.


Okay. Well, thank you very much. I look forward to seeing theproduct progress over the next three months. Good luck.








Thank you, Michael.


Thank you.

Operator

Your next question comes from Tag Vichu with Moores Tabot.

Tag Vichu - Moores Tabot - Analyst

Good afternoon, everybody there. I have been traveling thesame road you have for about 4 years, watching your companyas it’s progressed. I’m particularly interested in simply one aspectof the FDA’s review period going now to August 29th. Is itconceivable or possible that the FDA could complete the reviewin a shorter period of time than August 29th?


No, Sir. Because under the guidelines, when they are grantinga extension which we agreed to, it has to be the full 90 days.


I see. Does this delay affect the progress that’s going on in SouthCarolina?


Because we haven’t completed the negotiation on the financing,it’s hard to say for sure. And point of fact is we’ve been tryingto be very prompt in getting out to the public with thisinformation. They haven ’t checked in with the financial folksto see whether or not that changes their perspective. On thewhole, our partners, the Sumter Realty Group, are the folkswho actually do the money raising, so we don’t talk directly tothe financiers. Rather, we talk to them who in turn do thatnegotiation. Because these negotiations are all conducted in thecontext of, if you will, we approach where if we - - which wasgoing to get us financing regardless of the date of approval, Idon’t think it’s going to make a whole lot of difference. Butwe’ll have to talk to our pals at the Sumter Realty Group to seewhat the latest is and where they stand.


Sure. I realize it’s somewhat of an unfair question given thetimeliness of the announcement. The - - I had another question.I’m not sure I can remember what it was. Well, I’ll have to callDoug at some other time. Thanks very much and good luckwith the next 90 days.



Operator

Your next question comes from Todd Sidwell, private investor.

Todd Sidwell - private investor

Hello.


Good afternoon, Todd.


My question is about the new facility you mentioned openingin 2006. If I understand from the last question, that is goingahead or has always been planned for, regardless of what theFDA does at this point?


Yes.


And how will that increase some options for you?


That will provide us with an incremental 500,000 units per yearof production. In other words, take our capacity from just under100,00 to just under 600,000 units per year. It also will generatea significant improvement in the cost of making the products







which will contribute almost as much to the profitability as theadditional volume.


And you feel this will put the company then well on the roadto profitability I assume?


Yes. With that facility, we’ll have all we need to begin to giveour shareholders a long-awaited and much deserved good returnon their investment.


Great. Thank you very much. Good luck.

Operator

Your next question comes from Steve Happas, DakotaInvestments.

Steve Happas - Dakota Investments - Analyst

Good afternoon, guys.


Good afternoon, Steve.

Steve Happas. A couple of things as I’m relatively new toBiopure over the last 3 to 6 months. Have you before given -- upon FDA approval, crossing the fingers of you guys, lookslike you’re going to get it, but after you do get it - - have youguys discussed publicly of any type what it’s going to meanrevenue torque for the company going forward here in the first12 months and then out?


We’ve not provided any revenue guidance.


Would it be safe to say that, and as mentioned before on theprevious conference call that you did not get denied, but saidmaybe around the $800 per unit that would be in the ballparkof what each unit would cost? I mean would sell for?


I stand by what I said then. It’s in the ballpark.


So can I make the assumption that to produce anywhere between75,000 and 100,000 units, let’s say from a top standpoint, thatit could mean about $80 million in top line the first 12 monthsthat you ship the product?


I can’t argue with your math, but I would also say that it wouldprobably be unlikely that we would be able to ship full capacityfrom the first day it’s available as there is a considerablemarketing and selling job that needs to be done with physicianswith any new product, particularly one like this which is totallyfirst in class.


Right. And would that target still be October 1st even thoughthe August 29th now decision will be made?


Our objective is going to be to use this time well so that weexperience minimum delay in launching commercially. So yes,our target still will be to be in business in October.


October 1st, and then would you say maybe 25 to 50% then,of those 75,000 units at least would be able to be shipped in thefirst 6 to 12 months?


Steve, now you’re trying to trap me into giving guidance.








Well, I’m just trying to get - -


It’s like a sharp object and you should never carry them unlessit’s pointing at me. So I can’t reaffirm that for you today at least.


Okay. I appreciate it and great job, guys, and I hope all goeswell.


Thank you, Steve.

Operator

Your next question comes from Ronald Risotto with WestRock Investors.

Ronald Risotto - West Rock Investors - Analyst

Good afternoon, gentlemen. How are you?


Hi, Ronald.


I guess my question is going to be pertaining to Oxyglobin anddo you have plans to more aggressively go after the veterinarymarket?


Absolutely. In the month of, in the last month, we haveintroduced the new peer to peer marketing program which hasalready engaged 175 veterinarians in conference call discussionsabout the product where there is considerable peer to peerselling. Further, we have filed with the FDA the necessarymaterial to allow us to launch a new 60 ml bag format thissummer which is roughly half the size of the current bag which

will make it much more economical as well as easier to use thisproduct on smaller dogs and the like. So you will find, as ahallmark of what we try to do over the next few months, willbe to drive the Oxyglobin business and preliminarily at least,we’re encouraged by what we’re seeing. Orders have held upvery well after the huge volume we shipped after we took theproduct off shipment hold.


Terrific. Great job, guys. Thank you so much.


Thank you, Ronald.

Operator

Your next question comes from Ken Martin Halpine withEmerald Asset Management.

Ken Martin Halpine - Emerald Asset Management - Analyst

Good afternoon and congratulations. When do you expect torelease your next earnings for this quarter?


Well, having just done a quarterly, it will be roughly in threemonths minus one week. Let me see - -

Doug Sayles - Biopure - Director of Corporate Communications

I believe it’s August 22nd or whatever that Thursday is, ourquarter close is at the end of July.

Ken Martin Halpine - Emerald Asset Management - Analyst

Very good. Thank you.


You’re welcome.







Operator

At this time there are no further questions.


I’d like to thank everybody for getting together with us here atshort notice. We feel very positive about this latestannouncement and rest assured we’ll be working very hard overthe next 3 months to answer any other questions the FDA hasand also to make ready for what we hope for will be a verysuccessful introduction.

Operator

Thank you for participating in today’s conference. You maynow disconnect.

D I S C L A I M E R











Exhibit E




Event Transcript

BPUR - Q3 2003 Biopure Corporation Earnings Conference Call

Event Date/Time: Aug. 21. 2003 / 4:30PM ET







Doug SaylesBiopure Corporation - Corporate Communications

Thomas MooreBiopure Corporation - Chief Executive Officer

Howard RichmanBiopure Corporation - Senior VP, Regulatory and Operations


Jason ColbertSusquehanna Capital - Analyst


Alan Ferguson3i Technology Partners - Analyst

Richard AdamsBennett Lawrence - Analyst

Adnan ButtJ.P. Morgan Chase - Analyst

John CortMonarch Financial - Analyst

Richard AussieNation Direct - Analyst

Jonathan LuiDesto - Analyst


Operator

Good afternoon. My name is Jeff and I will be your conferencefacilitator today. At this time, I would like to welcome everyoneto the Biopure third quarter fiscal 2003 earnings conference call.All lines have been placed on mute to prevent any backgroundnoise. After the speakers' remarks, there will be aquestion-and-answer period. (OPERATORINSTRUCTIONS) I would now like to turn the conferenceover to Douglas Sayles, Director of Corporate Communications.Please go ahead, sir.

Doug Sayles - Biopure Corporation - Corporate Communications

Good afternoon everyone and welcome to our third quarter2003 conference call for the period ending July 31st. Todaywe'll report our financial results for this period and briefly discusssome of the company's accomplishments and activities after

which we'll answer a few questions. Before we begin, I'd liketo point out that during this call we'll make projections andother forward-looking statements which involve risks anduncertainties that could cause the company's actual results orperformance to differ materially from those projected. Thecondensed list of these respective factors appears at the end oftoday's financial results press release which you can access onthe Internet. A more comprehensive discussion occurs on ourSEC filings and at Biopure.com. Now I'd like to turn the callover to our CEO and President, Tom Moore.

Thomas Moore - Biopure Corporation - Chief Executive Officer

Good afternoon everybody and thanks for joining us. I'm joinedaround this table, in addition to Doug, by Ron Richards, ourChief Financial Officer and Senior Vice President of BusinessDevelopment; and Dr. Howard Richman, who is, as you know,our Senior Vice President of Regulatory Affairs and Operations.We feel very positive about our third quarter results from botha financial and general business standpoint. Our loss was $11.3million compared to $12.6 million in the same period last year.This translates to a loss of 28 cents per share compared to 43cents a share a year-ago. With Oxyglobin revenues of $885,000,up significantly from $260,000 a year-ago, we clearly arerevitalizing this business after paralyzing product shortages in2002. We also introduced our first new Oxyglobin SKU, the60 millimeter size bag, which is off to a strong start with$200,000 sales in just its first three weeks of availability. Thissmaller size is more convenient and offers better economics toour veterinarian customers, but is also a higher profitability SKUfor us.

Most importantly, we've made another big step forward on ourregulatory review of Hemopure by FDA. On July 30th, theagency informed us they had completed review of ourapplication and sent us all the questions that need to be answeredfor them to progress to an action letter. The agency has doneus a big favor by providing what amounts to a complete detailedresponse and set of questions to Biopure prior to the end of thereview cycle, and then stopping the review clock with 30 daysremaining in the PDUFA cycle. They have thereby made acommitment to give us an action letter 30 days after we provideour response to their questions. They could have just as easilyannounced an end to the review cycle with their response, inwhich case they would've had two to six months to respond toour answers instead of the 30 day period.

We've completed our initial response preparations and will nowformally request a meeting with FDA. Both Biopure and the







FDA have been informally clearing our calendars for this meetingover the past week in order to expedite our get-together. Thismeeting will allow us to request any clarification we need toensure that our complete response fully meets the agency's needs.We went to make the most of this opportunity to work withthe agency towards early action. Our efforts to date suggest thatwe're in good shape so far to be able to answer FDA's questions.However, we're still collecting some data, so the job is not yetcomplete. We are well down the preparation track on questionsrelated to our trials, Pharmokinetics (ph), immunology, labelingand the like. However, there are some questions, such asquestions related to historical data from our clinical sites, thatprecedes the actual running of our trials which could take sometime to collect. We hope the FDA will agree to reduce the scopeof some of these requests. In the end, the exact timing of ourFDA response will be driven by our interaction with FDA inthis meeting which we expect to have occur in September.

In a separate area, we're pleased by investor response to thecompany over the past three months. In July we completed apublic offering raising $17.2 million on what we believe arevery attractive terms, namely only a 5 percent discount to themarket with no warrant coverage. These terms are the best termsfor a public offering for any biotech company with a marketcap of $1 billion or less this year as of two weeks ago. We believethis also shows that we've achieved a degree of financial maturityas a potential investment opportunity. In conducting this raise,Chief Financial Officer Ron Richards and I presented to 62funds in person over a three-week period. This is the mostextensive presentation of the company ever, surpassing even theeffort behind the IPO launch. Subsequent share priceperformance suggests we're beginning to establish anunderstanding of the exciting future potential for Hemopure asboth a treatment for anemia associated with surgery, and anoxygen therapeutic for use in trauma, surgical ischemias andcancer therapy.

Finally, while we're discussing the stock, we have receivednumerous calls concerning insider trading activity over the pastfew days. Because of the flood of forms that are being filed areconfusing, I do want to take this opportunity to clarify justexactly what's going on. Our co-founder and Chief TechnologyOfficer, Carl Rausch, is continuing to sell a relatively smallportion of his Biopure holdings in order to meet his personalfinancial needs. He publicly announced his intent to do so, infact, some time ago. While about 350,000 shares have been soldover the last year, Carl is still the direct or indirect holder ofmore than 1,600,000 Biopure shares.

Two other factors have made insider reporting a little confusing.First we've had to update an error in Form 4 reporting on sharesindirectly controlled by Mr. Rausch dating back to the year2000. Unfortunately, each Form 4 since then has had to berevised separately, so this has led to a proliferation ofamendments. And finally, there have been some small interdirector sales -- shares exchanged with no net selling of shares.In fact, the company has locked up these shares until September-- I'm sorry, until spring 2004. Of all the company's officers anddirectors, only Carl Rausch has sold Biopure shares to outsidersover the past several months.

I want to update you briefly on our medical communicationscampaign as well which we touched in our last call. Briefly, inearly June, Hemopure investigator Dr. Jonathan Yar (ph), whois a Professor of Clinical Anesthesiology and Director of ClinicalResearch at the Department of Anesthesiology at UCLA, andDoug Hansell, our Vice President of Medical Affairs, gaveseparate Hemopure related presentation to the regional medicaldirectors of the American Red Cross. On June 6th, Biopuresponsored an investigator and thought leader meeting entitledclinical experience with Biopure which was chaired by ColinMcKenzie, Vice Chair of Anesthesiology at the Adams ShockTrauma Center in Baltimore, Maryland. On June 13th, ourSenior Vice President, Maria Gawryl, discussed the status ofHemopure during a blood substitutes workshop at a jointconference of the American Society for Artificial Internal Organsand the International Society for Artificial Organs in WashingtonD.C.

And the next day, on the 14th, Biopure sponsored an opensymposium on the clinical experience with Hemopure at theNetwork for Advancement of Transfusion Alternatives in SanFrancisco moderated by Dr. Lawrence T. Goodnough, Professorof Medicine Pathology and Immunology at WashingtonUniversity in St. Louis. On July 26th, Dr. Hansell also presenteda Hemopure overview to the regional medical directors ofAmerica's Blood Centers at their Scientific, Medical andTechnical Forum in Spokane, Washington. And then earlierthis week, Nora Philbin (ph) an investigator at the Naval MedicalResearch Center in Bethesda, Maryland, presented results of anNMRC preclinical study of Hemopure entitled Improved TissueOxygenation After Bovine Prelimerized HemoglobinResuscitation in a Slide Hemorrhagic Shock at the annualmeeting of the International Society on Oxygen Transport toTissue at the University of Rochester in New York.

And then in early September, Dr. Ian DeVosse, a South Africanorthopedic surgeon and Hemopure clinical investigator, willpresent data from the Hemopure Phase III trial at the annual







South Africa Orthopedic Surgical Congress in Cape Town,South America -- South Africa, excuse me. We also haverecently had a new publication on our product on expert opinionon biological therapy concerning the use of our product as anOxygen Bridge in patients with acute anemia associated withsurgical blood loss penned by Dr. Leavy (ph). Other study articlesare being submitted by numerous Hemopure investigators, andso you can expect a strong level of scientific exchange activityin the months ahead. Those are my overview comments. Wewould now welcome your questions.


Operator

(OPERATOR INSTRUCTIONS) Jason Colbert ofSusquehanna Capital.


Hi, Tom. Very exciting company in recent events at Biopure.A couple of questions on the letter from the FDA. You usedthe term complete response a couple of times. But, this isn't acomplete response letter. What is it exactly?


It's, and I'll ask Howard Richman to comment on this in just asecond. It is -- I think Howard will call it a hybrid, and by thatI mean it genuinely represents all the questions that FDA wouldlike to have us answer, and so in that sense it's like a completeresponse. But normally a complete response letter brings an endto the review cycle. And the agency has elected not to do that,offering us this precious opportunity to get a response 30 daysafter we submit the answers to those questions. And so, that'swhat it is.


It sounds like the response is going to take some time. Can youtell me about how many questions are involved? And thefollow-up question is, depending on the length of your response,is it reasonable to expect that the FDA is going to be able torespond back within that 30 day timeline? If you give them avery exhaustive detailed response back, as I know you will, isn'tit going to take the FDA longer than 30 days to respond back?


I think that's a very fair question, and that's one of themotivations we have for having a meeting with FDA simply sowe can agree on how we're going to order this data and maybehow we can share some of the data as we go so that it makes iteasier for them to meet that guideline.

Howard Richman - Biopure Corporation - Senior VP, Regulatoryand Operations

I'll share this with yourself and for the other people listening.This type of letter is very unique. As Tom clearly stated foreveryone, it is a hybrid, it's something that was done from the(indiscernible) perspective to work with Biopure in this aspectbecause you're right in stating that people have (indiscernible),this does not follow the area that we've seen where you lookon FDA sites or in other complete responses. This was donewith the specific intent to work with us. With that being said,it counts in such a way that they want us to be able to get backto them vis-a-vis this meeting and in our answers. Many of ouranswers will not be that detailed in response, some are inclarification, which will only meet the FDA with some pointswe're going to discuss with them. Other ones will just providethem information they requested in terms of clarification andfollow-up source documents and other information they'veasked about. So, when you say about a detailed (indiscernible)response, in many ways it will not be. But it's also clear that theformat that they have for us with FDA which will be clarifiedon a meeting in September will clearly enlighten us and themand give a clear pathway to the response in a correct time frame.


Okay. Thanks, guys.

Operator

Sapna Srivastava of ThinkEquity Partners.


Hi, Tom, how are you? A couple of questions. I guess I'm justexpected -- you mentioned some of the historical data may takemore time to collect, could you just give us some color on whathistorical data is being asked for, and what is your best guess ofthe time that you can put forward for these responses? Best casescenario, worst-case scenario?








Sure. I'll give you an example. The FDA requested bloodtransfusion records from our clinical sites which would extendback a year prior to when our study began. An example of sortof the background nature of many of these questions whichactually don't relate to the specific clinical data we collected.Collecting historical transfusion records from that many sites isa bit of an intimidating task, and so we actually don't know howlong it would take, but we know it's going to take more thanan afternoon of phone calls to bring all those records safely backin. That's one particular area we want to dialogue with FDA tosee if there isn't a way we can meet their needs without literallyfulfilling the terms of this particular request.

Your backup question of that was so what does that mean interms of the duration of getting all of this to happen? And Iguess I have to frankly say I just don't know because I don'tknow how long it actually would take to hire four or fivepeople, train them, and then get them on the planes withsuitcases to actually go off and retrieve these records. That's oneof the unknowable things that came out as we looked more andmore closely at the nature of FDA's request and the mechanicsof what it would take to really get that request fulfilled.


Can you help me understand, what do they do with bloodtransfusion records at clinical sites?


I'm sorry, Sapna, I didn't quite understand your question.


I just -- what does the FDA -- why do they require data(indiscernible) -- historical data from these clinical sites likeblood transfusion records? What does it go towards?


I think they're looking to see what the pattern is of the decisionsto transfuse. And I think they're interested in getting somebackground data on how medicine is being practiced in variousplaces. I don't know if Howard would alter or add to thatresponse.

Howard Richman - Biopure Corporation - Senior VP, Regulatoryand Operations

Just one (indiscernible) quite clearly. But just one thing forinformation. It's (indiscernible) of the uniqueness of this productthat will set the standard for other products coming behind it,the FDA has asked for this information so they'll be able to helpBiopure in this approval process and other companies that willcome down the same path as to what really are the transfusionrequirements as they see in the orthopedic and/or surgicalindications that will put the patients in the best possible placein terms of unit dosing. It's not an unreasonable request, it's justsomething that needs clarification. Does that help you?

Operator

Alan Ferguson of 3i Technology Partners.

Alan Ferguson - 3i Technology Partners - Analyst

Hi, Tom. I'd like to get some understanding of where Biopurestands in terms of approval in other countries?


Good afternoon, Alan. We -- as we talked in our last quarterly,we are exploring doing filings elsewhere around the world. Wehave had discussions with regulatory agencies to line up on whattheir requirements would be for a submission to check thatdatafile that we've collected, working with FDA will be sufficientfor approval in other areas. And I think we indicated that wewould be sharing more news about international filings beforeyear end. So that's an active area. We don't currently have anapplication pending anywhere else in the world.

Operator

Sapna Srivastava.


Sorry, I think we got disconnected. I still wasn't done.


Don't worry about that. We're very happy to have youreconnected.








Actually I just still wanted to get a better understanding aboutthe focus. So the blood transfusion record, is that the largest partof the questions that the FDA has given to you or the mosttime-consuming?


It's the most time-consuming question because it requires goingoff and getting data significantly. Frankly, like many of thequestions that the FDA asks, it doesn't require any reanalysis ofour data, it's more documentation, more information gatheringof a background nature than anything else.


Is it something that you can (indiscernible) postmarketingregistry, is that something you can do rather than having to delayit for approval?


It's the kind of thing that at least you can discuss with the agency,and that's why we think this meeting -- it's one of the aspectsof the meeting we think could be very helpful in terms ofstreamlining the actual action process.


And this meeting is going to be sometime in September, youdon't have a date yet?


That's correct.


Just on a little different topic, a couple more questions. Youmentioned some new data on Hemopure coming up or did Imisunderstand that?


We're going to the new publication on Hemopure.


Okay. And the last question is just, how is the use in SouthAfrica going, what's the update there?


Product continues to the used off the amount that we put in tobe used on a more or less of a donated basis. In our press releasewe mention the fact that, thanks to Howard's efforts, we havegotten the product in hand and have extended expiration date,so we're able to work -- continue to work off that initial donatedamount of product. We are working to unwind our businessrelationship with our previous partner there and start a new one.And that process is in the lawyer to lawyer discussion phase.


Okay. Thank you so much.

Operator

Richard Adams of Bennett Lawrence.


Just to repeat a question from earlier that I didn't hear an answerto which was the number of questions in the FDA letter. Canyou tell us that?


We probably aren't going to disclose that. I guess I shouldn't sayprobably. The number of questions isn't going to do very helpfulto people to understand what's really in the letter. As Howardindicated earlier, some of the questions are as simple as send usa list of this or send us the name of that. Things like that. So, aswe look at it, there are a number of questions involved. WhatI will say is there's probably about 50 substantive questions whichwe have -- which we're working on which are really the coreof the efforts that we're doing now. So, I think the number 50is more useful to bear in mind than the list of a lot of the stuffthey have we've just run to the copier, copy it and throw it inthe stack. But there are 50 things that we've got to work on togive them what we think will be a complete response.








Have you been assured by the FDA that once you answer the50 questions that they can issue an action letter or is the potentialthat you satisfactorily answer let's say 40 of them and you haveto go back and the process extends indefinitely?


That's impossible to say. The FDA doesn't give us that kind ofhand holding. Their approach is here are the questions, answerthem as best you can, and based on that we will give you ouranswer. Obviously one of the advantages of having a meetingwith the FDA is you can kind of reaffirm with them what arepivotal questions and what are nice-to-knows, what could beprioritized in what way, and that's one of our objectives in thediscussion coming up in September.


And the September meeting, did the FDA request a meeting ordid Biopure?


Biopure requested the meeting, FDA agreed that we could setthe agenda for the meeting, and then further that they didn'tneed to ask us any additional questions so that basically thediscussion will revolve entirely around the clarifications thatBiopure is going to request.


Okay. One last quick one. Do you expect to need to raise capitalagain before getting a definitive answer from the FDA?


I think the answer is, in my opinion I don't think we'll need todo any kind of significant raise before we get an answer fromFDA, that's my opinion. But because I can't -- one can neverbe entirely sure of the timeline, at least until we have thediscussion with the FDA, I can't issue a guarantee on that,Richard. I just think -- I think we're in decent shape given theframe that I'm thinking of.


Okay. Thanks.

Operator

Alan Ferguson of 3i Technology Partners.


Tom, can you comment in terms of where you are relative tothe pricing strategy? Is this product going to be priced more likea Procrit or is it going to be priced more like a unit of packsales?


As you would expect, Alan, the answer is no. Meaning, I thinkwe will be priced between -- I guess a does of Procrit is about-- Procrit is about $400 a shot, would you agree? So we'll bepriced above Procrit, we'll be priced above packed red bloodcells, but we'll be priced within a range of those prices that froma pharmacoeconomic standpoint as well as a therapeuticstandpoint we represent an attractive alternative.


Okay. Is there anything on the work the trials that the militaryis doing in trauma yet?


We've not initiated human clinical trials in trauma with themilitary or for that matter on the civilian side as yet. So, wehope to get started on that ASAP. I think probably those trialswill begin, however, at least after we have -- no sooner thanafter we filed our responses with FDA on the BLA questions.As I mentioned earlier in my flurry of discussions about meetings,Naval medical research has been very active in doing preclinicalwork on trauma with our product, and then sharing those resultsin several different forms actually. So, work is going on veryactively on the trauma side, but I don't believe human trials willbegin until after we have completed our answers to the BLA.Part of this is related to the fact that we already are engaged inFDA in a dialogue on a total clinical development program intrauma with FDA. And so we expect the final discussion on thatwith FDA will ensue after we've addressed the questions they'veasked for us on the use in anemia from surgery indication.







Operator

Jason Colbert of Susquehanna Capital.


Hi, Tom, me again. A couple more questions I'd like to explorewith you. What's the manufacturing plan and the status ofSumter Realty? I wonder if you could touch on that? And kindof in sync with that, what are you thinking in terms of a partnerstrategy and how are those discussions going?


From a manufacturing standpoint, as you know, our Cambridgefacility here has a capacity for about 75,000 units per year. Wealready know how we can upgrade that capacity to a rangebetween 90,000 and 100,000 units a year. It will require theimplementation of a variety of process upgrades while most ofthe capital is in place there's still a little bit of work here andthere that needs to be done, and our aim is to get thataccomplished some time over the next six to nine months. Thenext step, as you know, is the construction of our Sumter facilityin Sumter, South Carolina which will have a capacity of 500,000units a year. We have -- we continue to be in negotiations forthe financing for that facility. We're looking to get financing of$120 million on terms which would basically not require a netcapital outflow from Biopure until the plan -- the plant issubstantially complete, or i.e. in at least two years from now.

So, we're looking for very attractive financing terms. We don'tnegotiate directly for the financing, rather it's conducted throughan LLC, it's called the Sumter Realty group. The Sumter Realtygroup has informed us that they're in negotiations with twodifferent groups. They feel they're making progress, but as yetthey have not set a date where we actually could sit down andsign the papers. And realistically, until we sign the papers, Jason,I don't think I can tell you the deal is done. But we are goingto inform our investors when we feel that we're in fact movingin on a closing. But, it seems premature to make anannouncement in that regard at this time.


Is there a strategy, Tom, as you progress with the FDA towardspartnership?


Here's our thinking on partnership. We have had verypreliminary hi, how are you kind of discussions with some othercompanies. We have not pursued any partnership negotiationwith, at least domestically, with any major pharmaceutical entity.Principal reason for that is for our initial indication in orthopedicsurgery, and with our initial marketing plan which we've sharedin the past where we'll be focused initially on bloodless surgery,we don't really need the kind of scope and experience that apharmaceutical company would bring us, rather we need atremendous focus on that indication and the ability to traindeeply and vertically within the hospital medical centerenvironment, that's something you don't get when you borrowa salesforce from another pharmaceutical company.

So, for the initial indication, we don't think there's going to bea great deal of synergy in working with another pharmaceuticalfirm at the initial launch step. On the other hand, as we lookdown the road for major additional indications for the product,I'll pick one entirely at random, Jason. Our use as a tissuesensitizer in the radiation and chemotherapy of solid cancertumors like lioblastoma, liver cancer, pancreatic cancer and nonsmall cell lung cancer, there it's not hard to see that potentiallya partnership with a major cancer company could significantlyaccelerate the clinical development program and the introductionof our product as an additional tool in the war against cancer.

So, what I'd say is, Jason, we're developing sort of a differentiatedstrategy of how we would partner with this product in a waythat we think is going to maximize shareholder value and notgive away partial ownership in the company or rather on theproduct on a premature basis before we're able to fully showwhat the value of the product really is.


Thanks, Tom. One last question, and this is on a completelydifferent tact. It has to do with the Pivotal Phase III study, thepublished paper that Sar Stewart McKenzie Burke Williams did.In that study there's a section on serious adverse events,particularly respiratory failure where it shows four serious eventsin the HBOC-201 group versus zero in the RBC group. AndI just wondered if there was any explanation? Is the explanationrelated to data slicing and age cohorts in the different arms?








Just a second, I'm getting advice on this one. Our analysis ofthat study shows that the four patients involved already hadunderlying respiratory disease. So, I think at this point at least,my response to your question is we think it has to do withpre-existing conditions. I can say for sure that when you lookacross the total body of clinical data on our product, there wasno indication whatsoever of any association of our product withrespiratory collapse of any kind.


And does the FDA take that approach where they go into anindividual patient record when there's a statistical anomaly andtry to explain it in that format?


Yes.


Thank you very much, Tom.

Operator

Adnan Butt of ThinkEquity Partners.

Adnan Butt - J.P. Morgan Chase - Analyst

Congratulations first of all on all the positive headway you'vebeen making. I just had a question about use in South Africa.I'm wondering how closely you're tracking use whether it's interms of safety or efficacy? And if it is being tracked will that bepresented any time anywhere even if it's in the form of a casereport or a letter to the editor or something like that?


We are tracking it very closely. We tracked it initially, the waythe product was initially introduced in the country was underwhat's called a Section 21 provision. And under the rules ofSection 21 we actually present a report to the South Africangovernment on how the product was used, what its effectivenesswas and what its safety was. And we've completed and filed thatreport. And frankly I would love to share that report morebroadly, it paints I think a very positive picture of this product

and the like. Since the Section 21 provision lapsed, we're nowbasically just a free sale product in South Africa, but we haveour own special safety monitoring program so that we can sharemore or less of a Phase IV kind of fashion with both theMedicines Control Counsel in South Africa as well as FDA aswell as any other regulatory agency that cares to know. But theactual experience has been the use of the product in general.And I can tell you, it's a very positive picture.


But they are no plans to present it formally anywhere onceyou've started selling it?


Actually I can't tell you there is a plan to do so. We're -- ormore accurately, what we're exploring is how we can publishthis through a peer review journal so it will have the scientificstanding that it deserves. And so that's what we're looking atdoing right now.


And any timing on that or just still in the planning stages?


It's sort of in the advanced planning stages, but unfortunately Ican't give you a commitment at this time as to when it willoccur.


Thank you, that's very helpful.

Operator

Gabe Hoffman (ph) of Accipiter (ph) Capital Management.Gabe, your line is open. Please go ahead with your question.That question has been withdrawn. Your next question comesfrom Richard Adams of Bennett Lawrence.


I'm just curious as to whether you're planning to present thefull Phase III data set at a medical meeting sometime in the







future? I would think that that could help you Hemopure gaintraction in the U.S.


We are actually working to put a complete report on the 115trial. The 115 trial. We're aiming to publish that in a majormedical journal. We're in the process of submitting that articlenow. We also are looking for an opportunity to publish acomplete data set for the product in the next year or so, but asyet we haven't identified the publication for that.


There have been presentations of the Phase III orthopedicsurgery trial in 2002 at a couple of different meetings. And ifyou contact me, Doug Sayles, I can give you what's alreadypublic. The actual publication of -- in a peer review journal hasbeen in the process of being submitted by investigators now,but there are some abstracts and posters that are available.


Right. I've seen the abstracts that are public, I was just curiousabout the full comprehensive data set.


It isn't really like a chemical drug, there's an awful lot of datafrom this trial, and it's a first in class and the only trial of its kind.And part of the issues with the peer review journals is how toget all the information into the word limits. But we're trying tosee if whether it can all be fit within the word limits or cut upinto multiple publications, and there are various investigatorsworking on that right now.


Just one other. I missed the explanation on the blood transfusionrecords from the clinical sites. Why the FDA would -- why youthought they were requesting that information?


Remember, this is the first clinical trial ever conducted againstblood. So, I think the FDA is interested in getting moreinformation about what the normal transfusion patterns are for

various hospitals around the country and specifically our sites.So, it's historical -- it's simply historical data.


But you do think you can supply that or you're not sure at thispoint?


We think we can, we just think it's a lot of work. Not that wemind working hard.


Thanks.

Operator

John Cort (ph) of Monarch Financial.

John Cort - Monarch Financial - Analyst

Thank you for taking the call. You pointed out in -- of theSection 21 information related to the South African use of theproduct, and I think we all would like to see. But that aside,how long has -- it's Hemopure that has been actively used inSouth Africa now? Is that correct?


It has been actually used, yes? And how long -- we actuallybegan making it broadly available in mid 2002.


So let's say a year or so? How many units to your knowledgehave actually been dispensed or used by patients?


A little over 1000 units.








So enough to get some semblance of its success as I think youalluded to?


Exactly.


Great. I was curious as to -- for obvious reasons now that you'vestated it's been very quiet. We know it's in South Africa but wereally didn't know exactly what was going on and now we knowwhy. So I thank you very much and continued success.


Thank you, John.

Operator

(OPERATOR INSTRUCTIONS) Richard Aussie of NationDirect.


Good afternoon, gentlemen. My question is, what will you doif Biopure doesn't get FDA approval? And if you do get FDAapproval, what will be your three and five-year plan? Merge orget more approvals from different countries?


Sure. I'll address your first question first. While we arecontinuing to be cautiously optimistic, we're on the approvaltrack. If you ask us to specifically address this question, whichyou have, I guess what I'd say is the FDA doesn't really just sayno. At least not in a situation like this where an application hasbeen accepted and taken this far down the review track. Whatthe FDA says is here's what you've got to do, guys, if you wantto persuade us to say yes. And generally what they'd say is youneed more information. I'm going to take a big leap here,Howard may hit me. But if the information we've given themso far led them to say we can't approve it then they would'vealready said we can't approve it. Okay? You don't go back andforth like this because the product is not approvable. The

question for the agency is the process of putting together theadequacy of the total data set.

So, while we think we will have a more than adequate data set,again your question is what if they say no it ain't adequate. Ifthey said that, they would then tell us what we need to do tobe able to get back in front of them to get them to consider itonce more. So, what we would do after an event like that isdirectly related to what the FDA requests. If they requested forinstance a new round of animal trials, those can generally beconducted in under six months and so we would say, okay, we'llsee you again in April. If on the other hand they say we need anew round of Phase III style human trials, then that would bea much longer duration proposition. We would have to sharewith our investing public very clearly where we stand so ourinvestors can gauge what the probability is now, the ultimateapproval of the product. We need to raise the money necessaryto continue to do those trials and to continue to operate, or topursue an indication -- a different indication for the productbased on the other indications we have under development.

But either way, it would take some time to do that. Obviously,we would need to reduce our burn rate so that the amount ofmoney we raised would be no more than what's minimallyneeded in order to meet the clinical trial needs and other basicneeds of the company. And that's something -- while we don'texpect that to happen, that's something we fully engaged within our own internal planning because we're prudent businessmanagers, or at least we like to think we are.


Sure.


The second question you asked is, okay, if they say yes what'sthe plan from there? In broad terms, here's what we would do.One, we would focus on a very successful launch in the U.S.designed to utilize all of our Cambridge, Massachusettsmanufacturing capacity as soon as possible. It would be directedtowards orthopedic surgery consistent with the indication forwhich we expect and hope to get approval. It would initiallyfocus on bloodless surgery where the decision has already beenmade that people will go to extra lengths to avoid getting ablood transfusion from a stranger. But would be designed tobranch out pretty quickly across orthopedic surgery in general.Second, we would negotiate with FDA on what it would taketo broaden the indication to general surgery. Our belief is that







Phase IV studies and the like should be adequate, but the FDAhas not told us it would be, but should be adequate to get usextended to general surgery which would increase the size ofour potential market by a high multiple.

Second, we would go-forward with clinical trials which franklywe already have in the planning stage to explore cardiacischemia, trauma and cancer therapy both in the U.S. andEurope. Which together would increase the size of our marketby several times further. We would proceed with gettingregulatory approvals -- applications at least in in Europe andprobably in the Far East, and seek to create some geographicbased licensing situations fairly quickly in areas where we knowwe would never be able -- capable of marketing the productdirectly ourselves. And then secondarily, embark on a businessdevelopment plan where we would selectively evaluate certainindications and determine from the standpoint of maximizingshareholder value whether or not we should choose to partnerout for specific indications.


Well, that's an elaborate plan. I appreciate it, and best of luckwith the new product.


Thank you, Richard.

Operator

Jonathan Lui (ph) of Desto (ph).

Jonathan Lui - Desto - Analyst

Hi. Congratulations on your quarter and I guess my questionis, what has been the average selling price of Hemopure andOxyglobin? And kind of a related question is, how many unitsdo you need to ship to breakeven? And third of all, whatpercentage of the orthopedic market do you need to capture tobreak even?


Okay. Speaking quickly on that, Oxyglobin has an averageselling price of $125 for the 125 milliliter bag. And on a goingbasis we have a bit of an introductory discount going on now.We'll have an $85 average selling price for the 60 milliliter bag.

Hemopure we have not set a selling price yet, either in SouthAfrica or in the U.S. So, at this point in time I don't have anaverage selling price to give you in that area. When we do we'llrelease that. Question number two. Helpers? Helpers? Thenumber of units to achieve breakeven on our manufacturingoperations, i.e. who have a plant operating at a profit, is about40,500 units per year. Total corporate basis, that is handling thecosts of clinical research, the well-deserved salaries of our keyemployees and the like, the figure would be higher but that'llbe based on how we choose to control those highly variablecosts. What we've said publicly is while we can breakeven offthe production of our Cambridge facility, with the type ofclinical development programs we have in mind, we think itwill take the added capacity of the Sumter facility to be in aposition as a company where we're turning in a very(indiscernible) profitable performance. Your third question,Jonathan, I apologize, was?


What percentage of the orthopedic market do you have tocapture in order to achieve your breakeven target?


The orthopedic market in total is 450,000 units. That is totaltransfused units in orthopedic surgery per annum. I apologize,that is wrong. It's 1.5 million units in total in orthopedic surgery;450,000 are used in the bloodless surgery area which is ouroriginal initial marketing target. So, of the orthopedic surgerymarket, which was your original question, Jonathan, we needbasically to achieve a stunning and highly aggressive 2.5 percentmarket share in order to break even on our manufacturingfacility. That is the 40,000 units. If we wanted to break even asa company, we probably would have to get up to around a 7percent market share that is around 100,000 units to be able todo that.

Within this bloodless surgery target of 450,000 units, there weneed to achieve something like an 8 or 9 percent share to breakeven on our manufactured operations, and realistically arounda 20 percent share in order to break even as a total company.


Just to follow up on that, what would be your roadmap to cashflow positive?








The roadmap would be successful introduction withinorthopedic surgery. Opening of our Sumter facility, which givesus the added capacity to break through this 100,000 unit level.And then frankly once we do that, we can get to a cash positiveposition reasonably quickly. Our target right now is to be ableto do so basically by the end of 2006 if FDA approval isreasonably prompt, or in 2007 if it takes some time for us tofinish the discussions with FDA.


How do you plan to kind of maintain your funding in themeantime? Because I understand -- I think you're fundedthrough 2004, April?


That is correct. That, of course, assumes no revenue beyond aflat Oxyglobin picture. So the building blocks from here wouldinclude, number one, with approval we will start getting revenuefrom Hemopure sales, and while they are not enough to get usto breakeven, if you cut your burn rate from, let's say, currently$11.5 million per quarter down to one or $2 million a quarter,you are not yet breakeven but you're in a much moremanageable financial situation.

Two, we do aim to do these regional licensing deals, which willbring in additional revenue both in some cases in upfrontpayments, in other cases in additional revenue as the productgets introduced. Third, we will probably go into the market forsome additional money as well.


Okay. Thank you.


You're welcome.

Operator

Ladies and gentlemen, we have reached the allotted time forquestion-and-answers. I would now like to turn the conferenceback over to management for closing remarks.


We do feel very positive about the progress we've made in thelast three months. As perhaps you can tell from some of theanswers we've given to the questions asked, we're actually prettyfar down the track in fleshing out our introductory program,following hopefully FDA approval. But for now our focus is onworking with FDA to get to the action letter phase as quicklyas possible. We continue to be cautiously optimistic that as soonas we get all our answers back in that we'll be in a very goodposition. Beyond that, we will continue to work to build ourOxyglobin business. We'll be working on internationalopportunities. I hope we'll be able to close our financing onSumter sooner rather than later given the critical role that hasin the long-term profitability of the company. But in general,we feel like we're making good progress at this time. It's themost exciting time for your company, and everyone here isfrankly just plain very turned on and working extremely hardto make this period as productive as possible. Thank you foryour support and I look forward to talking again with you allsoon.

Operator

This concludes today's conference call. You may nowdisconnect.

D I S C L A I M E R











Exhibit F



Biopure Presentation by Thomas Moore, CEO

ThinkEquity Partners Growth Conference

San Francisco, CA at the Omni Hotel

Wednesday, September 17, 2003 12:30 PM ET / 9:30 AM PT

Sapna Shirasava:

Good morning, and thank you for joining us. I’m Sapna ShirasavaBiotechnology Analyst at ThinkEquity Partners and today it’s my pleasure tointroduce Tom Moore who is the CEO of Biopure. Biopure is one the companieswe have closest relationship with and have followed for a long time. We are veryexcited about the company. It is the leader in [the field of Oxygen therapeutics.It is the first company which has filed a BLA with the FDA in the field of Oxygentherapeutics after over 40 years of work in that field and I’ll let Tom tell us thisvery exciting story.

Thomas Moore:

Thank you very much, Sapna. Good morning everybody. Let’s start offon a high note please with the, always popular, disclaimer. I’ll give you a coupleof seconds to look at that while I reattach my microphone. The unusual partabout that disclaimer is that among other things, it says that anything we sayhere is not necessarily policy of the US Government. I’m told that Colin Powellnow has to show a similar disclaimer before he makes his talks.

So, Biopure is a company that’s devoted 19 years of its life to developinga totally new concept in therapeutics and pharmaceuticals. The first in classoxygen therapeutic. Our product for humans called, Hemopure, is a new class ofpharmaceutical which is intravenously administered to deliver oxygen to tissues.While it was developed initially to provide an oxygen bridge for the immediatetreatment of the signs and symptoms of acute surgical anemia, we’re working onsubsequent potential indications which include use in trauma, ischemiaassociated with surgery and other situations and in cancer treatment. In my talkthis morning I will touch on how we are going to develop that, as well. Ourproduct is a true biologic. It comes from biology. That is it comes from cows. Inthis case, red blood cells that we harvest from cows in sequestered herds wekeep in Michigan. These red blood cells are then lodged open so that we canextract the hemoglobin within which is the core of our product. That hemoglobinis purified through a proprietary process which includes our own high-performance [lipid chromatography ?] process developed by our founder, KarlRausch. This purified hemoglobin is then stabilized and [polymerized?] in order


Biopure Presentation by Thomas Moore, CEOWednesday, September 17, 2003Page 2

to form the ideal or what we believe is the ideal, particle size for safelydistributing oxygen around the body. This polymer has an average weight in ourhuman product of 250 kilo-Daltons, and in our veterinary product of 200 kilo-Daltons, and that is the only difference between the two products. This resultingproduct has many advantages versus red blood cells which we fondly refer to asRBCs.

First of all, because its pure hemoglobin, and because we have purified itto the point where it is stripped out of almost all other allergenic material, thisproduct is compatible with all blood types. There’s no tissue matching requiredto be administered to anybody. Second, it’s a highly stable product and that ispart of the choice in using bovine red blood cells to start this process. Ourproduct has a shelve life of three years, and it’s not three years underrefrigeration or under special conditions, it’s three years at room temperature ortemperature as you would consider considerably above room temperature up toabout 80-85 degrees Fahrenheit. Because it is a manufactured pharmaceuticalthat offers consistent potency and stability and purity, something which frankly, ishard to guarantee with red blood cells donated by human beings, and unlikehuman red blood cells, our product delivers oxygen immediately upontransfusion. Human red blood cells, once they have been stored for up to 5-8days, begin to lose their immediate potency and distributing oxygen – it actuallytakes several hours for them to regain that potency in the human body. And so,for someone in need of added oxygen distribution in their body, our product is areal godsend. Finally, of course, we have an abundant and well controlled rawmaterial source where as, as we’ll talk about a little more later, human red bloodcells are becoming increasingly scarce supply for any number of broad basedreasons which we will touch on in just a minute.

So, that is what the product is. How does it work? Well, in the humanbody as you can see on this hemo on the left, under normal circumstances, redblood cells distribute oxygen throughout the body going through both the arterywhich you see is the larger tube on the left, and into the smaller arteries andcapillaries which branch off to the right. When that situation happens, everythingis doing great. However, when for reasons related to trauma or anemia, orsurgery, the number of red blood cells get reduced, several things change. Firstof all, there are fewer red blood cells so there is obviously less oxygen beingdistributed as you can see in the center photo here. Secondly, the bodyautomatically compensates for the reduced number of red blood cells byconstricting arteries that serve various tissues in the body, in fact, ultimately, inthe case of shock, basically shuts off all arteries except for those that serve thebrain and the heart. The two most important organs. So, when Hemopure getsadded to the body, other things begin to happen. Hemopure is represented bythese orange dots that are flowing in the plasma around the red blood cells. First



of all, as you can see in this schematic here, a great deal of more oxygen getsdistributed thanks to the addition of Hemopure. In fact, Hemopure is two - threetimes more efficient at distributing oxygen around the body pound for pound thanred blood cells and that stems from the fact that it is more aggressive aboutgrabbing and giving up oxygen as it goes through the system. In fact, red bloodcells only give out a third to a half of the oxygen that they’re carrying in a passthrough the body, while Hemopure gives out all the oxygen that’s turning plusgrabs some oxygen off the red blood cells and redistributes that as well. So, theaddition of our product to the human body is very significantly anddisproportionately increases the total oxygen getting distributed to the body. Thesecond interesting thing that happens is because our product is one-onethousandth the size of a red blood cell, it really gets distributed to oxygenwherever the plasma itself gets distributed. In this case you can see theconstricted artery to the right is where the Hemopure is able to penetrate and infact distribute oxygen to places where the body itself is constricting the circulationof red blood cells. This has an important implication in other areas which we callischemia where there is a blockage of red blood cells. That can happen as a by-product of cardiac surgery where debris coming from breaking up a clot can stopcirculation temporarily in various parts of the heart or sometimes the brain. Italso happens in situations more commonly called heart attack and stroke, wherewe believe our product ultimately could have some application, as well.

So, you’ve seen the product, you’ve seen a little bit about how it works.We ought to, I guess, eventually get around to talking about Biopure thecompany. From an investor prospective, I think we offer some very interestingopportunities. First of all, we are the leading developer of oxygen therapeutics.We have two products that have been developed and approved, a veterinaryproduct and a human product. We offer a multi-billion dollar market opportunitywhich I will outline for you in just a minute. There is clearly a global need for ablood substitute based on supply shortages in developed countries and ongoingsafety concerns in lesser developed countries and there are multiple applicationsfor this product, a couple of which I just described to you before.

As a company, we are truly poised for commercialization. We own all therights to our product, the technology and the patents. We have largest validatedmanufacturing capacity within this field of products. Lastly, we brought in newsenior management over the past year which is leading the transition in thiscompany from a research and development oriented firm to a truecommercialization company. A word briefly about that. In the past year, and fourmonths, we have brought in the five people you see highlighted in yellow here.Our strategy in all of this was to strengthen the company in three importantareas: marketing, manufacturing and process capability and finally, finance, andwe think we’ve done that. My background with 23 years with Proctor & Gamble,



including running a world wide healthcare products business, as well as runningNelson Communications one of the largest pharmaceuticals sales and marketingservices company [solidly ?] in the pharmaceutical marketing area as well as ingeneral management. I joined the company a little over a year ago to shore upspecifically in that area. Bob Richards has joined us as Chief Finance Officer.He’s a San Francisco boy so he’s sure happy to be back here. Many of you mayknow him from his work with Van Casper and other firms in investment banking,and he is shoring up our ability to work with the street and to chart our long-termfinancial future. Doug [Hansel ?] is our relatively new medical director. Aexperience in practicing clinical anesthetist. Barry Scott was vice president ofinternational businesses [ ?] for Bristol Myers Squibb. He has joined us in asimilar capacity. Donna Wolfe ran her own medical education company and isnow running our long-term scientific exchange and medical education programs.

In addition, we shifted Karl Rausch, the founder of the company, to ChiefTechnology Officer; Frank Murphy who has done an excellent job as CFO to anew position as Senior Vice President of Engineering Process technology in bothcases to improve focus in improving our manufacturing efficiency and makingready for the introduction of our new manufacturing facilities in the next couple ofyears which will expand both capacity but also our ability to manufacture thoseproducts at the lowest possible cost. Our board of directors is a distinguishedone. Charles Sanders, Dr. Sanders, is first former chief executive officer of[Praxcel ?] as well as former president of Massachusetts General Hospital. Jim[Dittleson ?] is the co-founder of the company and previously a co-founder aswell of Midwestern Corp. Dick Cloud is a former division chief of the FDA,extraordinarily insightful and a regulatory expert and C. Everett Coop is, what canI say, he’s C. Everett Coop. But he’s also spent four years on the developmentof blood substitutes, so he has a huge personal interest in this category.

So what about these products, a little more detail please. We have twoproducts: Hemopure, which is our human product, which was approved for thetreatment of acutely anemic surgery of patients in South Africa in 2001. As manyof you know, we filed our biologic license application for treatment in acutelyanemic orthopedic surgery patients with the FDA in the US in July 2002. Theyhave since given us a complete review and has sent us some questions, and wewill talk about where we stand on that process in just a moment. Oxyglobin isour veterinary product. It was approved for treatment in [anemia ?] dogs in 1998in the US and 1999 in the European Union. We sold now, over 137,000 units.We recently introduced the new size to drive this business upwards. Bothproducts have something important called the EDQM Certificate of Suitability.What that means is that we have passed the stringent requirements of theEuropean regulatory authorities concerning our ability to remove all pathogensfrom our product and specifically the pathogens everybody thinks about when



they think about cow blood, namely BFE. And we demonstrate that to thesatisfaction of both the European Authorities, who are very picky about this one,as well as the FDA.

So where do we stand with our BLA at this point? As I mentioned, wesubmitted or BLA back in July of 2002, it was accepted in October of 2002. Itwas the first the BLA ever accepted by the FDA for a hemoglobin based oxygencarrier. The FDA in May indicated that it wanted to expand their action due dateto the end of August and instead, they sent us a complete list of questions at theend of July. In the letter they sent us, they indicated the following:

First, they’d completed their review of our application. That there aren’tgoing to be any more questions after the ones that they sent us, and that’s agood thing, because they sent us a lot of questions. In fact, there are about 50that are pretty substantial that are going to require a significant effort on our partto answer - and additional questions beyond that.

The agency has informally, since then, referred us to this letter as our roadmap and it is a road map we intend to follow and we are working very hard to getall these questions answered as quickly as possible.

After careful review of this letter in August, we decided we wanted to askthe agency for a meeting to both clarify the questions they asked and also to find,in a couple of cases, a mutually agreed upon range of data we are going to lookat in order to give them their answers. Some of the questions are pretty broadreaching and we assumed that we would need a meeting in fact to get theanswers to those questions. Since then, the agency has been extraordinarilyresponsive to our information requests. We have had six major contacts withthem since we received the letter. Four in response to questions orcorrespondence sent to us. The turn out at these meetings have beenunbelievable, frankly, in the four instances where we sent correspondence to theagency - in every case they responded in less than a day and in two cases, lessthan two hours. So, there is an extraordinarily close collaboration going on here,which is great. In that, we are getting the guidance that we expected we wouldhave to have a meeting for back in August, considerably ahead of schedule. So,at this point, I’m not sure if a meeting is going to be necessary to round it off ornot. At this point, there are just a couple of more questions to go through.

In the meantime, we’re busy answering all the questions where we don’tneed any guidance, as well as reviewing the input we have had from the agencyon some of these bigger questions in order to get our answer back ASAP.Everybody wants to know, when are you going to get your answer back? And,we want to be able to give you good guidance on that and we said we would get



the meeting done in September and then we would know roughly where westand. It’s the middle of September so I think we have a week or two yet to sortof get our act together and take a look at what it’s going to take to finish ourresponse and after that is done, we will be able to provide some better guidancefrom that point. In the interim, we are busy answering questions as fast as wecan.

What about the market opportunity? [ While our initial indication process,file was for surgery ?]. Within that, because we are marketers now, we arefocusing on the area that is going to be easiest to penetrate, and that is the areawhere people are practicing blood avoidance, and blood avoidance surgery. Andthe orthopedic surgery in the area in the US alone, has a potential market atabout $300,000,000. If you look at blood avoidance as practiced across theentire field of surgery in the US adds an additional $450,000,000 marketpotential. We have applied some arbitrarily chosen and I think quite conservativepenetration numbers to those markets to yield some early revenue projections forwhat we could do out of those indications. If we could move more broadly in thegeneral surgery and get only 10% of general surgery use of blood at our plannedmarketing price of about $700 per unit, that would add up to about a$700,000,000 revenue opportunity. The three other areas we are working on aretrauma, where we are working towards beginning trials later this year, this is foruse in ambulances, secondly surgical ischemia where the product could be usedin order to counteract the side effects that patients experience from the short-term ischemia as I mentioned early that were off on a by-product of surgery suchas cardiac surgery and finally in the area of cancer therapy which is rather acounter intuitive indication for us, but basically there are a class of tumors calledsolid tumors, [in the ? ] of the brain, mild small cell lung cancer, liver cancer,pancreas cancer and like, which are called solid tumors. These tumors areextraordinarily hard to kill and unfortunately, that’s one reason why they are soextraordinarily lethal to patients, because in part, the way these tumors develop,there is a layer of tissue within these tumors which becomes [an-oxic ?], that isthere is virtually no oxygen in that layer of tissue and because all of our treatmentstrategies for cancer, whether it is ionizing radiation or chemotherapy, dependson highly oxygenated active tissue to be effective, these tumors becomeextremely difficult to kill.

The application of our product in both animal testing and a very smallphase I human trial, appears to have in fact sensitized these tumors to radiation,and offers the opportunity to be confirmed in the future human clinical trial toimprove the kilo weight on these tumors per treatment, hopefully improve patientmortality as well. So those are the four key indication areas we are working on.The total potential, obviously, is huge. But we think it is realistically [able?] to beachieved by the company in years ahead.



Use of this product in surgery. How urgent is that really? While there aremany people who prefer not to get a blood transfusion from a stranger under anycircumstances, there are also underlying demographic reasons, if you will, whythis product would be important here. The rate of growth in our blood supply isnow declining. It’s declining for many reasons. First of all, as we place more andmore restrictions on who’s allowed to donate blood, the number of people whoare eligible to do that is in fact declining. And secondly, the need for blood hasgone up. As the baby boomers reach the ages of 55+, they are looking for newknees, new elbows, new hips, all of which are highly blood consumptive surgery.So, as the demand for blood over the past five years has been going 5%, theblood supply has only been going 3%. It is projected that demand is going togrow +7% pace, and that the supply of blood may actually drop to about flat. Ifyou talk to physicians around the country today, they say, “well, for the last fewyears, we’ve seen shortages in January and in July, basically because peopleare on vacation and either on holiday or vacation, so they are not donating blood,but now shortages are almost constant.” And unfortunately, that is projected tocontinue for sometime. So, we think there is a huge need for a good red bloodcell substitute and that’s one of the things this product can do. I mentioned earlyfrom a marketing standpoint initially, we are going to go after the target market ofthose who practice blood avoidance. Why? Because people have already madea commitment with time and effort and money to avoid getting red blood cellsfrom a stranger. So, we can meet their need by giving them a purepharmaceutical style product. The strategies they use are basically three fold.One is to pre-donate their own blood, called an Autologous donation, the secondis to use a product called Erythropoeitin, which you’ve probably heard of, whichstimulates red blood cells direction, both of which require office visits prior tosurgery in order to set it up, two office visits to pre-donate two units of blood forAutologous and four office visits to receive four shots for EPO. Unfortunately,this is a highly wasteful approach. Half of the pre-donated blood or half of theErythropoeitin use for orthopedic surgery is in fact not needed. Because half oforthopedic surgery patients don’t end up needing a transfusion. So, all of thiseffort is in fact, well, at least 50% wasted. The other sad fact is that of those whodo need the transfusion, half of them require more than two units, so at least inthe case of those who pre-donated two units, they end up getting blood from astranger, anyway. So if you look at pre-autologous donation as part of thismarket, 75% of time, it actually doesn’t succeed in its principal objective.

Here’s a financial spread of how that might look from an economicstandpoint of our product. In this chart, each one of these cases is two patientseach and basically was pre-autologous donation. The cost of two units each fortwo patients is $350.00 leading to a $1,400 total cost, in the case of in-hospitaltransfusion, there’s an extra fee of $200, which comes to a total cost of $1,600for two patients, or $800 per patient. Erythropoeitin at $400 a shot is twice as



expensive. Hemopure, given to only one of the two patients who actually endsup needing blood comes in at about the same as pre-autologous donation, butsignificantly cheaper than EPO. Of course, cheaper also in terms of the time andeffort and risk associated with it as well. So we think we have a good [?]. Ourclinical experience with this product was quite extensive, over 200 clinical trials,pre-clinical studies, 22 human clinical trials, and a great deal of experience inboth the veterinary and human market in general. This is an overview of thenumber of trials we’ve done and the people involved. Basically, it totals 806people taken Hemopure under highly controlled clinical circumstances.

The efficacy standard the FDA set for our product was that we needed todemonstrate 35% replacement of red blood cells with our product. That is, 35%of patients who took our product did not need to switch to red blood cells at anytime. And we significantly exceeded that in both our phase III trial in generalsurgery and orthopedic surgery at 43% and 59%. In fact, within that, if you lookat the trial over time, in the first week, 70% of patients in our clinical trial, avoidedtaking red blood cells, only because by protocol, they are not allowed to getHemopure after day 7, but the number ultimately dropped as low as 59%. Froma safety standpoint, our agreement with FDA was that the primary safetyendpoint would be based on a peak analysis which was a separate analysis ofthe data done by an independent and blinded medical panel. That panelconcluded that our product was not inferior to red blood cells in respect to overallmedical risk. This is not the only way the agency looks at safety but it is theprimary safety endpoint.

We have very strong intellectual property. A great deal of patents. I’mgoing to give you eye strain for at least half a second. There they all are. But, ifyou just look at the date line on the right hand side, you’ll see how the vastmajority don’t expire until 2014, or later. And frankly, most of the intellectualproperty in the more recent ones get carried over to the later patents. Currently,we have a 75,000 facility unit in Cambridge, Massachusetts, which we areexpanding to 100,000 units within the next year. We are working on financing fora 500,000 unit Sumter facility in Sumter South Carolina, which would obviouslyvastly increase our capacity, drive down unit cost, and basically would be thepivotal advance we need to do in order to get this company to profitability.

From a competitive standpoint, Hemosol is now on a clinical hold. It is notclear whether it will be able to resume. Northfield has developed a productstrictly for trauma use, they are hoping to begin enrollment in their clinical trial forPhase III by the end of the year. Their product is vastly different in its storageand shelf life and characteristics. We think our product represents a moreattractive and option for use in trauma because of it’s ability to be stored at roomtemperature rather than in refrigeration, and the market will tell us. Our strategy



from here is to prepare for the US launch in orthopedic surgery. We aredeveloping a strategy in using a highly experienced medical device, anorthopedic medical device, sales force to do the principal selling job against oursurgeon primary client, and then create medical science liaison teams who willtrain the balance of hospital staff so they’ll know how to use our product bothsafely and effectively. Otherwise, we are going to roll revenues by building ourSouth Africa sales. We are negotiating strategic alliances designed to allow ourproduct to be introduced into other geographic areas and we’re taking initiative toexpand our veterinary business, most recently with the introduction of a newsmaller bag size, which is also more profitable for us.

Clinically, we are working on getting the approval and the introduction tobegin our orthopedic indication. We aim to begin our trauma studies later thisyear. Ischemia later this year as well. Cancer will be our 2004 project. We haveworked hard to keep our balance sheet strong. Point in fact, our cash on handhas steadily improved in the past year and has correlated nicely with the status ofour stock price.

That’s our story. I appreciate your attention and I will begin your break outacross the hall in the Nob Hill room. I look forward to talking with many of youthere. Thank you very much.


Exhibit G



Biopure Presentation by Thomas Moore, CEO

UBS Global Life Sciences Conference

New York, NY

September 25, 2003 12:30 PM EST

Jeff Meecham:

Good afternoon. My name is Jeff Meecham, I’m one of Biotech’s researchteam here at UBS. It’s my pleasure to introduce Thomas Moore, CEO of BiopureCorporation.

Thomas Moore:

Thank you very much. Good afternoon everybody. Thank you for joiningus today. We’ll start off with the always popular disclaimer side, which none ofyou have ever seen before. I will point out thought that this one is slightlydifferent from the other ones because it does say that the content of thispresentation does not necessarily reflect the position or the policy of thegovernment or department of defense. We have to say that because so much ofour trauma research is being overwritten by the US Military. I’m told that ColinPowell is also obligated to put this disclaimer in front of any speech he makes.So, like I said, on to talking about BioPure and in particular our productHemopure, which is a first in class oxygen therapeutic in a whole new class ofpharmaceuticals designed to be intravenously administered to deliver oxygen totissues. We initially developed this product to provide an oxygen bridge to thetreatment of the immediate signs and symptoms of acute surgical anemia, but wehave been working very hard over the last few years to also develop initialindications including use in trauma, ischemia, particularly associated with surgeryand in use with cancer. And I’ll talk about more of that as we go forward.

How do we make our product? Our product is a biologic by the definition,that is it is a highly refined form of hemoglobin drawn from an animal source,specifically from the red blood cells of cows, certainly a plentiful source. Wehave special herds in central Michigan that are sequestered from other animalsand whose feeding and other care is carefully monitored by folks contracted bythe company. Periodically, through these cows are invited to take a trip toPennsylvania. There, somewhat reluctantly they give up 50 - 22 liters of theirblood, prior to being slaughtered for meat. That blood is held until the cows arecleared for human consumption and then the blood is sent across town to ourinitial processing facility where the red blood cells are taken out of the plasmaand then broke open and the hemoglobin extracted. That is the biologic productthat’s the core of our products. That product is then purified through several


Biopure Presentation by Thomas Moore, CEOSeptember 25, 2003Page 2

steps, including a proprietary high performance liquid chromatography step, so itreally gets down to just the pure hemoglobin itself, in it’s so-called nativehemoglobin form. We then stabilize that hemoglobin and use a polymerizationprocess to create an elected size for this hemoglobin which is ideal for its primaryjob for transporting oxygen through the blood stream and for doing so as safelyas possible. The resulting product offers several advantages compared tohuman red blood cells.

First of all, because it’s pure hemoglobin with no other allergenic material,it’s compatible with all blood types. In fact, it’s compatible with all species thatuse hemoglobin to carry oxygen around their systems. Our veterinarians whouse our veterinary product has transfused this product into over 37 species, fromalligators, to birds. It’s worked with all of them. Second, it’s a highly stableproduct. In fact, the shelf life of this product is three years. And that three yearsstability is importantly at room temperature, which we define as up to 80 degreesFahrenheit. Unlike human blood, which once it is extracted from the body, has alife time of only 42 days and only then if it is kept refrigerated through that periodof time. And because we are a carefully manufactured pharmaceutical qualityproduct, we offer consistency potency, purity and stability, something which can’tbe guaranteed with a product derived from directly from a human source of redblood cells, particularly because the potency of red blood cells decline sharplyafter the initial donation occurs. In fact, after roughly 8 days, the capacity of redblood cells to carry oxygen around the system immediately upon transfusiondeclines by over 50%. In fact, it takes several hours before human red blood cellsthat are transfused to fully regain their oxygen carrying capacity. So, we deliveroxygen immediately upon transfusion which red blood cells cannot. And ofcourse, finally, we have an abundant and a well controlled raw material source,something which can’t be said for the human population. So, that’s the nature ofour product and it is a breakthrough characteristics in terms of how it’s beencompared to red blood cells, but its breakthrough in other ways as well, and thatis in the way it actually works within the human body.

Here you see a representation of a situation where the patient whichinitially has normal concentration of red blood cells and as you can see, the redblood cells are carrying oxygen, those little bubbles that come off through bothmajor arteries and then the finer capillaries that branch off to the side. In thecenter of these three graphic representations, you see the situation where thatpatient becomes anemic due to sudden blood loss from surgery or from traumaor some other source. And a couple of things happen. First of all the fewer redblood cells distribute less oxygen which you can see here, but secondly the bodycloses off the smaller arteries and capillaries to conserve these red blood cellsfor the major organs of the body, ultimately the brain and the heart and does notlet these red blood cells distribute oxygen through the rest of the body. In the



third picture you can see what happens when Hemopure is added to the system.First of all, the total distribution of oxygen goes way up. In part, that’s becauseour product is three to four times more efficient than human red blood cells inactually delivering oxygen to the body. Human red blood cells give out only athird to a half of the oxygen they have per pass through the body, while ourproduct gives off all of the oxygen it carries. The second important differenceyou can see in this as well though, is our product, because it is particle size, isone one-thousandth the size of a red blood cell, can bypass the restrictions thatthe body has put in place when it feels it’s short of red blood cells. In this case,you can see our product is going down that constricted artery on the right anddistributing oxygen to tissues which otherwise would get no oxygen whatsoever.This capacity and capability is important for the other indications we have underdevelopment such as use in surgical ischemia to bypass the short term ischemiawhich sometimes results from cardiac surgery, once the clots are being brokenup, and also in cancer where we can oxygenate any anoxic cancer tissue whichotherwise would be extremely resistant to radiation or chemotherapy and makethat tissue 30-50 times more responsive to both radiation and chemotherapy.So, that’s our technology and our product, and some of what it can do.

Now, not so reluctantly, I’d like to talk about our company. Our companyBioPure is the leading developer of oxygen therapeutics. We define leading as,we are the only company that has had actually two different products in thiscategory actually approved by regulatory authorities. We believe we are facedwith a multi billion dollar market opportunity based on a growing global need for ablood substitute, but also these additional applications would stem from theunique physical structure of the product that we created, and third, as a companywe are really poised for commercialization. We own all the rights to our patentedproducts and technology with very strong and long-lasting patent rights. And wehave the largest validated manufacturing capacity to produce these products.Finally, we have made significant changes in our senior management in order tolead us on the transition of being a fully commercialized firm. Let me talk aboutthat just briefly.

Over the past year, we have made several changes designed tostrengthen the company in three key areas. Marketing, manufacturing, andfinance. In the marketing area, the first thing the board did was bring me onboard. I’ve been working in the pharmaceutical industry for over 15 years.Initially with a small product company called Procter & Gamble where I ran theworldwide pharmaceuticals and the over-the-counter drug business for 4 yearsincluding roughly $850,000,000 of prescription drug business. I then spent 7years running Nelson Communications, one of the leading sales and marketingservices providers for the pharmaceutical industry, participating in dozens ofproduct launches and working with over 200 prescription drug company clients.



And so, I come in to really help with the transition of this company building a boatby general management as well as pharmaceutical marketing experience.Beyond that, we have added individuals like Donald Wolf on the bottom there,who is a very experienced medical education person to improve the quality of ourscientific exchange. On the manufacturing side, we reassigned individuals fromwithin the company Karl Rausch and Rick White to focus on a area we callprocess technology, designed to improve the reliability, stability and theexpandability of our national manufacturing process both to increase the capacityof our Cambridge facility to its maximum amount, but also to pave the way for theconstruction for our new planned facilities. And finally, we added Ron Richardswho has extensive investment banking experience with VanCasper and SecurityPacific to come in as CFO to improve our ability to work with the street and to laythe groundwork for the financing work we need to do in the years ahead upon theexpansion of the company.

Our board of directors is listed on the right. It’s a very distinguished one.Lead by Dr. Charles Sanders who is previously chairman and CEO of Glaxo aswell as President of Massachusetts General Hospital, Jim Jellison who is part co-founder of the company as well as co-founder of Gulf and Western. Karl Rausch,who is also co-founder of the company, C. Everett Coop who of course is C.Everett Coop, but he’s also been working with blood substitutes for a number ofyears.

More details then about our products. We have two products, hemopure,the human version and Oxyglobin the veterinary version. Hemopure has beenapproved for the treatment of acute surgical anemia in South Africa since 2001.We applied for approval in the US in 2002, the US FDA responded to us in theend of July this year, and we are in the process of recurring answers to the manyquestions they asked of us, and I’m going to give you more details on that in justa minute. Our veterinarian product was approved for use in the US in 1998 andin Europe in 1999, and more importantly, both our products have earnedsomething called the EDQM Certificate of Suitability. This is a certificate issuedby the EMEA, the European Medicine Agency and it’s a requirement for thedistribution and sale of any product in Europe based on bovine products, basedon any kind of biological material related to cows based on the well-knownEuropean concern about BSE. This certificate certifies that we demonstrate totheir satisfaction that our manufacturing process can eliminate the viral andwhatever you chose to call the [prions ?] associated with BSE, as well as sixother key pathogens that can be transmitted through cows, and that’s thefundamental basis for the overall safety pitch of the product from the standpointof viral infection. On our veterinary size business we sold over 137,000 units sofar and as I mentioned before, our veterinarians have been very aggressive in



using that on dogs, yes, but on a wide variety of other species as well and quitesuccessfully.

As I mentioned earlier, we submitted our BLA in July 2002. The FDA gotback to us at the end of July 2003, somewhat ahead of the regulatory schedulethat had been set up which would have ordinarily been required a response bythe end of August. The letter they sent us indicated the following: First, that theyhad completed their review of our application and second, that they are not goingto ask us anymore questions, these are all the questions they have to ask. Andthat’s a good thing for us too, because they asked a lot of questions. With about50 representing substantial BioPure effort in order to fully respond. Since then inour dialogue with the agency, the agency has referred to these questionsrepeatedly as our roadmap and that’s a roadmap we intend to follow. Aftercareful review of the letter, we knew that we needed to ask the agency somequestions to both clarify what they meant in their questions, but also to findmutually agreed upon ways to narrow the scope of the data they’d been askingfor in order to get the answers back to them as expeditiously as possible. Weannounced in August we would seek a meeting with FD in September to getsome of these questions answered. Since then, the agency has beenextraordinarily responsive to our questions. In fact, of the six major interactionswe had with the agency about this letter, they have come back to us withresponses to the questions and issues we raised in general in less than a day. Insome cases less than an hour. And as such, we’ve been in a happy position ofseeing most of our questions getting answered without the need for a meetingand by now, most of them, in fact, have been resolved with one or two stilloutstanding. So, as we get this guidance back, we are simultaneouslydeveloping our own internal time line for when we are going to complete ourresponse back to the FDA. We promised our investors that we would try to getall of our answers back from FDA in September and then come back to them witha specific information about the time line for a response, and we are right ontrack to do that. We expect to be able to do so in the month of October. In themeantime, we are busy answering questions, and in fact, preparing ourresponse. We’ll simply be able to provide a better guidance as to when thatresponse will be completed by the end of October. In large part, that’ll bedependant on how much effort and time is required. For some of the questionswhich the agency asked which require us to go back to our investigator sites andget more raw information from them. In some cases about our product, and inother cases about historical data on issues like transfusions and like of thosesites. So, that’s where we stand there.

What’s this about market opportunity? Well we show here a quicksummary of the opportunity we see for this product based on the US marketalone. And I’ll run through it for you very quickly. Our initial marketing strategy of



filing for approval of this product for use in orthopedic surgery is to go after thepart of the orthopedic surgery market that is most receptive to the opportunity touse an alternative to [alogenic ?] blood and that is the population that has alreadydecided they want to participate in bloodless or blood avoidance surgeryprograms. Within the US in orthopedic surgery alone, that represents a potentialmarket of $300,000,000 for us which assuming only 30% market penetration isroughly a $90,000,000 revenue opportunity short-term. Assuming we canexpand that to use on all other bloodless surgery that would increase the - morethan double the total size of that total market opportunity from our standpoint.Again, assuming relatively conservative penetration of that market. Longer termas we can expand our generation to general surgery, that would open up a hugemarket of $700,000,000 to us in addition to those earlier smaller markets. Oursecond key priority is to use this product in trauma. In ambulances and in themilitary applications where blood would not otherwise be available. Here in theUS alone, we see the total market of about $250,000,000. The opportunity for usat about $130,000,000. We expect to begin the clinical trials leading to establishthat indication in the next 3-6 months.

The next opportunity is in surgical ischemia. That is the use of thisproduct can [combinative ?] with procedures such as stint placement andangioplasty where it’s already been well established that 20-30% of patients cansuffer from side effects associated with this surgery related to other ischemicevents which occur as a result of that surgery. Namely, when a clot getsdisplaced, the fragments of that clot can lodge further down the blood stream, inthe heart or the brain, creating other short term and sometimes long term sideeffects. Assuming only 50% of penetration of that market in the US alone, thatwould represent about a $350,000,000 opportunity. Again, assuming the cost tounify our product at around $700. And finally in cancer therapies as I havealready indicated. We see a huge opportunity in improving the quality oftreatment for solid tumors like [leopastoma ?] the brain, non-small cell lungcancer, pancreatic cancer, and the like - where solid tumors are created that areso aggressive that the interior actually becomes anoxic, that is that tissue more-or-less goes to sleep from lack of oxygen, but therefore, becomes incrediblyresistant to treatment by radiation or chemotherapy. We believe we can undothat with the application of our product. So, that’s the opportunities we see ittoday.

Is there potential even beyond that? We think there is. One key area isbased on the potential large scale shortages in the supply of blood itself. Quitesimply, the relationship of blood supply and demand is changing rapidly and itschanging in the direction of creating broad scale shortages in this critical area.The reasons are simple. In order to insure the safety of the blood supply, we areincreasingly restricting whose allowed to give and therefore the donors pool is



actually contracting. Meanwhile, as baby boomers approach the age of 55+,they’re out to get replacement parts: new elbows, new knees, new hips, all ofwhich are highly blood intensive surgeries. As a result, in the last 5 years, therate of growth in the blood supply has dropped only 3%. But the demand hasgrown to +5%. Those numbers are projected to go further in each direction overthe next few years and in fact, short term blood shortages are now becomingroutine across the country.

Alright. What about the other aspect of this tolerability to get into thebloodless surgery market? I’ll go through this very briefly, but quite simply, thereare two broad scale techniques that are used to avoid blood from a strangertoday. Predonation of your own blood, or the use of Erythropoeitin to increaseyour blood count before surgery. Both are supplemented in most cases by theuse of cell salvage, where a certain portion of your bleed out in a surgery can berecaptured and recirculated to your body. From a pharma-economicalperspective, this process is incredibly wasteful. Half of pre-donated blood andhalf of the Erythropoeitin use is in fact not needed, because half of the peopleend up not needing a transfusion and so all that gets thrown away. Beyond that,half of the people who do need a transfusion use three units instead of the twothat is generally pre-donated, and as a result they actually end up getting bloodfrom a stranger anyway. So, 75% of blood avoidance techniques are “a failure”either because they are unnecessary or because they do not succeed in theprimary objective, to avoid getting blood from a stranger. From a cost standpoint,this puts us in a very strong position. If you looked at it from the position of twopatients going through each of these procedures, someone who pre-donatesblood, generates their blood at a cost of $350 a unit. For two patients, that’s atotal of 4 units. Two of which get transfused, for a total cost of $1,600. From aninsurer’s standpoint or a hospital’s standpoint, that means this program costs$800 a patient. Erythropoeitin costs twice as much, $1,600 a patient.Hemopure, because you don’t use it unless you need it, only one of the twopatients will actually require the product and there is the reward of the savingsfrom the perspective of both the hospital and the payer because on that basis thecost per patient is only $800. Of course, cost isn’t this whole picture. On the lefthand side, pre-donation, you’re dealing with two visits to the dr.’s office, thediscomfort of two extractions for the blood as well as the cost internal to thehospital in handling that blood. So in both cases, we think we represent anattractive pharma-economical alternative within this market.

Many of you have seen a summary of clinical experience which is aboutthe same as before, so I’m going to run through it quickly here. We have animpressive overall clinical track record. Over 200 pre-clinical studies, 22 humanclinical trials, over 800 patients exposed to the product in a clinical setting, a lotof compassionate use experience, a lot of veterinary experience in the open-



market and some good patent protection behind that. Our studies on all kinds ofsurgeries and represents a broad experience for the product and again with over800 patients using the product in a clinical setting. From the standpoint ofefficacy, the agreed upon standard with the FDA for the efficacy of the productwas the 35% of patients in our trials, on a trial where they could switch the redblood cells at any time, that within the seven day period of the trial, excuse me,six day period of trial, that less than 35% or more would be able to stay onHemopure throughout the course of the trial. In our two phase III trials, ingeneral surgery and orthopedic surgery, we easily surpassed that standard with43% and 59% respectively. When you look at the internals, it’s even moreimpressive. Within the first day, 96% of Hemopure patients stayed onHemopure, after seven days 70% were on Hemopure. Unfortunately under theprotocol of the trial no patients were allowed to get any Hemopure after day six,so by the time the full monitoring period was over, only 59% were still onhemopure only, but again that easily surpassed 35% standard set by FDA.

From a safety standpoint, in our pivotal trial, we agreed before the trialbegan with the FDA to use as our primary safety endpoint something called a[Seep?] study. Which is basically a blinded analysis of all the case report formsby a panel of doctors who would examine each patient, create their own score ofadverse events and then rank the product use again on a blinded basis in termsof how safe it was for the patient. After all the patients were rated by at least twoblinded doctors, we broke the blind, and compared the accumulative scoresbetween our products and red blood cells and achieved a safety objective whichwas to confirm that our product was not inferior to red blood cells with respect tooverall medical risks.

As I say, we have a strong group of intellectual property. 24 U.S. patentsand over 60 international patents. The majority extend to 2014 or later. Forthose of you with exceptionally high corrective power on your glasses, you’ll seethat basically, there are only six patents between now and 2014 that expire. Themajority of that intellectual property is recovered in later patents and we areissuing new patents all the time. From a manufacturing standpoint, we currentlyhave a capacity of 75,000 units at our Cambridge, Massachusetts facility. We’rein the process of expanding that to roughly 100,000 units, and we expect thatprocess to be complete by the middle of next year. We are still in activenegotiation for the financing necessary to construct a 500,000 unit facility inSumter South Carolina. Which could be up and operating basically roughly threeyears after the shovel first hits the ground, and frankly, based on the unitsproduced and the significantly superior cost structure units produced there, reallyis going to be the pivotal point to getting this company to full profitability. From acompetitive standpoint, we are the only company using bovine hemoglobin thatconfers unusual stability and characteristics for our product compared to our



competition. As probably many of you know, Northfield, our principal competitorat this time, is beginning Phase III trials of their product for use in trauma,hemosol, is currently on chemical hold due to safety issues. It is unclear when orif they will progress from that point.

Our strategy from here is pretty straightforward. We’re going to makeready for U.S. launch in orthopedic surgery. Our strategy uses a team ofexperienced orthopedic device salespeople to persuade orthopedic surgeons thisis the important next step in high technology to incorporate in their practice.When they insist that it be distributed in the hospitals, we will follow up withmedical science liaisons who will facilitate the training for anesthetists,anesthesiologists, floor nurses and intensivists in order to ensure that the productis safely and effectively used within the hospital scene. Secondarily, we aregoing to work to grow our revenues within our veterinary business within ourSouth African business and through additional alliances. Our licensingagreements principally focused on geographic usage and geographies we don’tintend to penetrate on our own. I’ve outlined for you the clinical program whichwill be focused on trauma and cardiac ischemia over the next year or two. Ouraim is to get going on a cancer program sometime late in 2004. From a balancesheet standpoint, we have continually strengthened our balance sheet during thisyear. In fact, this graphic probably gives you the best picture. Cash on hand isnow in the ball park of $30,000,000 and we’ve been demonstrating repeatedlyour ability to raise the money necessary to keep this company on a strong cashfooting.

That’s our overview of our picture. I appreciate very much your interest inthis presentation this afternoon. I think we’re going to do a break out in the StateSuite. I look forward to hopefully talking to several of you there.


Exhibit H



Page 1 of2

Biopure Corporation (ticker: BPUR, exchange: NASDAQ) News Release -10/30/2003

Biopure Updates Regulatory and Operating Plans

Conference Call Scheduled For 11:30 a.m. ET Today, October 30, 2003

CAMBRIDGE, Mass., Oct. 30 /PRNewswire-FirstCall/ --Biopure Corporation (Nasdaq: BPUR) today announced its plan to respond byJune 30, 2004, to the Food and Drug Administration's (FDA) questions regarding its biologic license application (BLA) for Hemopure(R) [hemoglobin glutamer -250 (bovine)]. The company has adjusted its operating plan to reduce expenses and conserve cash while itcompletes its written response to the FDA.

Biopure applied for FDA approval to market the company's oxygen therapeutic, Hemopure, in the United States for the treatment ofacutely anemic adult patients undergoing orthopedic surgery and for the elimination or reduction of red blood cell transfusions in these

patients.

During the past two months the company has had several substantive interactions with the FDA to clarify the Agency's questions. Manyof Biopure's responses have been completed. However, some require the retrieval of source medical documents and/or historical bloodtransfusion data from clinical trial sites in various countries, which will take several months to complete.

Biopure has engaged David Zuchero, President of Chesapeake Regulatory Group (CRG), as its interim senior regulatory officer to directthe FDA response activities ofBiopure's in-house regulatory team, the CRG team and other external consultants. He replaces HowardRichman, former Senior Vice President of Regulatory and Operations, who has left Biopure to pursue other interests. A 25-year industryveteran, Zuchero has provided strategic counsel and managed several major regulatory submissions during his 13-year tenure at CRGand in his previous regulatory positions at Phannakinetics Laboratories, Inc., Chelsea Laboratories, Inc., and Ayerst (now Wyeth-Ayerst) Laboratories. He is a certified regulatory affairs expert, attorney and former microbiologist.

Biopure has also implemented cost reductions designed to minimize its ongoing cash burn, which include reducing the workforce byapproximately 30 percent and decreasing forecast manufacturing expenses for fiscal 2004. These measures represent overall anticipatedsavings of approximately $12 million in fiscal 2004, despite higher costs associated with FDA response activities. The company is in theprocess of renewing a standby equity distribution agreement to provide up to $15 million as needed. Biopure's current cash andanticipated Oxyglobin revenues together with this standby facility are expected to fund operations through December 2004.

"In the best interests of our shareholders, today we've taken the steps necessary to more efficiently run our business while we completeour comprehensive response to all of the FDA's questions," said Biopure President and CEO Thomas A. Moore. "We view the Agency'squestions as a 'roadrnap' to approval and have set a conservative, achievable target date for our response. We remain enthusiasticallycommitted to commercializing Hemopure in the United States as expeditiously as possible."

Biopure's updated plans continue to include clinical development ofHemopure for other potential indications. A Phase II cardiacrevascularization trial in patients undergoing elective percutaneous coronary intervention (e.g., angioplasty, stent) is scheduled to beginenrolling patients in Europe this year, and a Phase II trauma trial co-sponsored by the U.S. Army and Navy is anticipated in 2004. Thesenew trials are unrelated to the current Hemopure BLA.

Conference Call

Biopure President and CEO Thomas A. Moore will discuss the company's regulatory and operating plans in a conference call andwebcast on Thursday, October 30, 2003, at 11 :30 a.m. ET. The dial-in numbers are 1-800-535-9844 (US/Canada) and 1-706-634-7089(International). A live audio webcast of the conference call will be available from the investor section of Biopure's web site atwww.biopure.com and will be archived for at least one week. The webcast can also be heard by individual investors atwww.companyboardroom.com and by institutional investors who subscribe to StreetEvents at www.streetevents.com. An audio replayof the conference call will be available at approximately 2:30 p.m. ET, October 30, 2003, until midnight ET, November 7, 2003. Toaccess the replay, dial 1-800-642-1687 (US/Canada) or 1- 706-645-9291 (InternationaVLocal) and reference conference ill number3753466.

Biopure Corporation

Biopure Corporation, headquartered in Cambridge, Mass., is a leading developer, manufacturer and marketer of oxygen therapeutics, a

7/21/04http://www .corporate- ir .netlireye/ir_site.zhtml ?ticker=BPUR&script=411 &item_id=464811 &layout=23


Page 2 of2

new class of pharmaceuticals that are intravenously administered to deliver oxygen to the body's tissues. Hemopure(R) [hemoglobinglutamer -250 (bovine)], or HBOC- 20 I, is approved in South Africa for the treatment of adult surgical patients who are acutely anemicand for eliminating, delaying or reducing the need for allogenic red blood cell transfusion in these patients. Biopure's veterinary productOxyglobin(R) [hemoglobin glutamer -200 (bovine)], or HBOC-301, the only oxygen therapeutic approved by the FDA and theEuropean Commission, is indicated for the treatment of anemia in dogs.

The content of this press release does not necessarily reflect the position or the policy of the u.s. Government or the Department ofDefense, and no official endorsement should be inferred. Completion of the pivotal RESUS clinical trial ofHemopure in trauma iscontingent upon further funding. Statements in this press release that are not strictly historical may be forward-looking statements. Therecan be no assurance that Biopure Corporation will be able to commercially develop its oxygen therapeutic products, that necessaryregulatory approvals will be obtained, that anticipated milestones will be met in the expected timetable, that any clinical trials will besuccessful, or that any approved product will fmd market acceptance and be sold in the quantities anticipated. Actual results may differfrom those projected in forward-looking statements due to risks and uncertainties that exist in the company's operations and businessenvironment. These risks include, without limitation, the company's stage of product development, history of operating losses andaccumulated deficits, and uncertainties and possible delays related to clinical trials, regulatory approvals, possible healthcare reform.manufacturing capacity, marketing, market acceptance, competition and the availability of sufficient financing to support operations.The company undertakes no obligation to release publicly the results of any revisions to these forward-looking statements to reflectevents or circumstances arising after the date hereof. A full discussion of Biopure's operations and fmancial condition, and specificfactors that could cause the company's actual performance to differ from current expectations, can be found on the company's Web siteat www.biopure.com/corporate/legal/home_legal.htm and in the company's filings with the U.S. Securities and Exchange Commission,which can be accessed in the EDGAR database at the SEC Web site, www.sec.gov, or through the Investor section of Biopure's Website, www.biopure.com.

* $4,502,900 is from Grant DAMD17-02-l-0697. The U.S. Army Medical Research Acquisition Activity, 820 Chandler Street, FortDetrick MD 21702-5014 is the awarding and administering acquisition office.

Contact: Douglas Sayles (617) 234-6826Tom Nealon (617) 234-6873Biopure Corporation [email protected]

SOURCE Biopure Corporation10/30/2003

CONTACT: Douglas Sayles, +1-617-234-6826, or Torn Nealon, +1-617-234-6873 both of Biopure Corporation, [email protected]

Web site: http://www.biopure.com(BPUR)

http://www .corporate-ir .netJireye/ir_site.zhtml?ticker=BPUR&script=411 &item_id=464811 &layout=23 7/21/04


Exhibit I




Event Transcript

BPUR - Biopure`s Regulatory and Operating Plans

Event Date/Time: Oct. 30. 2003 / 11:30AM ET







Thomas MooreCEO, President - Biopure Corporation

David UcheroSenior Regulatory Manager - Biopure Corporation


Marcus Denennero (ph)Smith Barney - Analyst

Bruce Peterson (ph)Janney Montgomery Scott - Analyst

Gudrim Bowler (ph)- Analyst

Unidentified Participant


David HoffmanAccepitor Capital Management - analyst

Jakar BozGreenberg Healthcare - Analyst

Kevin Tang (ph)Tang Capital - Analyst

Steven Marks (ph)Blue Ridge Capital - Analyst


Operator

Good morning, my name is Corey, and I will be yourconference facilitator today. At this time, I would like towelcome everyone to the Biopure Corporation RegulatoryUpdate conference call. All lines have been placed on mute toprevent any background noise. After the speaker's remarks, therewill be a Q&A period. IF you would like to ask your questionduring this time, please press * then 1 on your telephone keypad.If you would like to withdraw your question, press * then 2 onyour telephone keypad. Thank you. Mr. Douglas, sir, you maybegin your conference.


Good morning everyone and thank you for joining us on ourconference call today. We'll be discussing regulatory andoperating update after which we'll answer a few questions. Butbefore we begin, I'd like to point out that during this call we

may discuss projections and other forward-looking statementswhich involve risks and uncertainties that could cause thecompany's actual results or performance to differ materially fromthose projected. The condensed list of these respective factorsappears at the end of today's press release, which you can accesson the internet, and there is a more comprehensive discussionof these risk factors on our SEC filings at Biopure.com. NowI'd like to turn over the call to our CEO and President TomMoore.

Thomas Moore - CEO, President - Biopure Corporation

Good morning, everybody. I would like to add my thanks toyou for joining us this morning. Around the table here I alsohave Ron Richards our CFO, and also on the line, DavidZuchero who's mentioned on the press release this morning,who'll be introducing himself briefly a little bit later in ourremarks. As you all know this morning, we announced threeor four additional new events for Biopure Corporation. First ofall, our financial response time to the questions that the FDAsent us on our biological license application, questions that wereceived in late July. Second, our engagement of David Zucheroon an interim basis as our senior regulatory manager replacingHoward Richman. And third, a reduction in force by thecompany to reduce our cash burn over the next several monthsas we repair our responses. I'm going to address each of thosebriefly, and then we'll throw it open to questions.

In terms of the response timing, as many of you know, we saidall along that the precise time of that response would bedependent on our discussions with FDA, which we conductedduring the month of September. While the discussion coveredseveral items: specific clarifications of certain questions, the keyissue vis-à-vis our timing was to see whether or not we coulduse sampling approaches as opposed to having to collect all theblood transfusions and other source data that the FDA requested.The FDA in all these discussions was very responsive, answeringall our questions promptly and we engaged in good discussion.But nevertheless the bottom line conclusion that we drew wasthat the FDA was not in a position where they could tell us ofthe sampling approach in fact would be guaranteed to meet thefull needs of what they wanted to see.

On that basis, we made the decision that we're going to go outand collect all the source data we requested which unfortunatelyis going to be more time-consumptive that we would haveoriginally hoped. As we then stated, there's simply as not asmuch data at hand for us to be able to answer these questionswithout going out to the various sites. So, we already have a



F I N A L T R A N S C R I P TBPUR - Biopure`s Regulatory and Operating Plans




traveling team in place collecting the information from thevarious sites, but as we look at the total picture we wanted toset an expectation for the market which was recentlyconservative and one we could make, and by the end of June2004 is precisely the expectation we want to set. In terms of thechange in regulatory leadership, change in personnel is alwaysdifficult particularly in a somewhat high-profile position likethis, so we believe that it's an opportune time for us to makethis change for the company.

Howard's worked very hard the last several months in ourdialogue with the FDA to define the precise scope of the datacollection work we need to do, and we're very appreciative ofthe job he has done in that area. We're now in a position wherewe're sort of a regulatory law, by that I mean we know exactlywhat we have to do. We know what the roadmap is that theFDA has set out for us to respond to their questions, and ourteams are working hard to do that. Howard is not in a positionwhere he's managing the preparation of that response and so ina sense, there's not much to be done in this area until thoseresponses are closer to being submitted to the FDA. At the sametime, we are looking at the development of other indicationswhich was mentioned in our press release in both cardiace d e m a (ph) as well as some trauma, as well as exploringinternational opportunities. We felt as we looked at this broaderrange of strategic issues that this was a good time to addadditional regulatory and strategic resources to our managementportfolio.

So on that basis, we decided to make this change, and we arevery happy to be able to secure on an interim basis the servicesof the Chesapeake Regulatory Group and in particular, DavidZuchero to work us through this process while we're in theprocess of bringing in a new in-company regulatory head. Andbecause I know there's a lot of interest in David in this hand-off,I asked David to participate in this call. I've asked David to onlyprovide you with some perspective with his background, he'snot in a position to answer any of your questions about theregulatory process and we're not going to ask him to do that.So, David, I'd appreciate it if you could briefly introduceyourself.

David Uchero - Senior Regulatory Manager - Biopure Corporation

Sure, thanks a lot Tom. My name is David Zuchero. I'mbasically a 25 year veteran in the biopharmaceutical industry,the last 13 years of which I have founded and headed theChesapeake Regulatory Group, CRG. CRG basically provideshigh-level strategic regulatory planning and regulatory liason

services so we help companies figure out where they're goingwith their products and how to get to FDA approval. Wemanage and coordinate the development approval process withthe FDA. We've worked with some of the largest companies aswell as intermediate and start-up companies. We've probablyworked on close to 50 approved products both in biologics anddrugs. Basically I know personally I've worked onblood-replacement products in the past and am excited abouthelping Biopure move this product forward to approval.

I think that's about it for me.


Thank you David. Again, at the risk of frustrating some on thecall, that's all we're going to ask David to say. While he has spenttime working with us on this, he's not in a position as yet tocomment on our regulatory situation. So unfortunately you'rejust going to have to rely on me for that. David, thank you verymuch.

The third item we addressed in our... I'll go back a little bit, assome will ask "Well, how do we and the CRG come together?"As many of you know, we're very fortunate to have on ourboard, folks with extensive FDA experience notably RichardCrout who was division chief for the FDA as well as a varietyof other consultants and advisors that David C a i n e (ph) highlyrecommended, and so we're very pleased to be able to bringhim onto the team.

The third matter we talked about in our release today was ourreduction in force, which is the polite way to describe thelay-offs that we've in fact already executed this morning. Eversince I joined this company, investors have been coaching meon the need to reduce our basic burn rate with the company.In the process, in September and in earlier October when wegot a real handle on the collecting timing of our response, givingthe time it's going to take to collect this source information. Itseemed right to finally make the step to reduce that burn rate,as painful as that is both for this company and for me personally.

Fundamentally, this is a manufacturing reduction in force. We'vebeen staffing our facility to have a capacity of 50,000 units peryear. Until we get FDA approval, that's simply not a likelydemand situation, and so we have in essence reduced ourmanufacturing staffing which will enable us to have an annualcapacity of 10,000 units a year, which is certainly adequate forour needs on our growing Oxyglobin business as well asHemopure. The way we've approached this is to decide to keep







the manufacturing facility running basically all the time, and ina position where we can ramp it back up to full capacity withminimum effort and with no need to requalify or revalidate ourmanufacturing processes, so we think it's the right and prudentstep for us to take. This is a very painful process but it is whatwe believe is right for the business. Of the reductions we'vemade, we've basically done a force reduction from 72 people.Starting from about 240 of those people, 90% came from ourmanufacturing operation. I want to extend my personal thanks,and the thanks of the company, to these employees for departing.They have helped get us to the terrific position we are in today,and so while this is an extremely difficult time, this is the singlereduction we're doing, and this process is now complete.

And so, I guess to sum up, prior to your questions, my view isthat the job of the management of this company is to keep thiscompany moving forward and to provide real leadership,communicating as openly as possible but also making the toughdecisions that are really in the best interests of the shareholders.To carry that out, we've laid out a timeline which I hope isconservative, but it's one we will make. We've moved forwardwith personnel changes which we believe will help move thiscompany forward faster in the future, and we've addressedstructural cost issues which we've had actually for some timebut simply should be addressed in the context of the time it'lltake to make this response to the FDA. We're going to continueto do what we think is in the best interest of the shareholdersand we hope our shareholders in turn will support us as wecontinue to be cautiously optimistic in moving towards bothregulatory approval and an outstanding business in the future.

Those are my comments; I will now welcome any questions.


Operator

At this time, I would like to remind everyone that in order toask a question, please press * then 1 on your telephone keypad.We'll pause for just a moment to compile the Q&A roster.

Your first question comes from M a r c u s D e n e n n e r o(ph) , from Smith Barney.

Marcus Denennero - Smith Barney - Analyst

Yes, the question is: you have experience in South Africa withyour products. What's been the result of that experience, andother international possibilities?


Our stretch in South Africa has been very positive from thestandpoint that we have had good experience with the patientsand developed what we consider a very good safety record withthe product. It has been approved for use in general surgery inSouth Africa, and so it's being used in a wide variety of situations.We've reported and carefully tracked the usage of this product,reported very good therapeutic results. In particular, in the past,we've talked about experience in areas like breast reconstructionsurgery where practices have converted totally to the use of ourproduct as opposed to transfused blood based on their perceptionthat the product is providing superior healing rates, lowerinfection rates and less tissue rejection which is importantparticularly in the case of breast reconstruction surgery as thatis generally followed by radiation or chemotherapy which canonly be begun when healing is in fact complete. We continueto get very good interest in the product, we are continuing toopt the product on the interim free basis as we are restructuringour commercial agreements in South Africa so that we can inessence leave the partnerships that we've currently been in whichhas developed some real issues and market this with a newpartner. That activity is going on now, but the record of theproduct and how it's been used is quite good.


I'm sorry.


M a r c u s (ph) had a second part of his question. He askedabout other international work.

We have, sorry about that. We have had - we have hadregulatory discussions both with the European central regulatoryauthorities as well as with specific European countries. We haveprioritized, however, our response to U.S. FDA as our reallytop priority.

And while we're continuing to pursue these and there arecertainly some very real interest in the product there, we aregoing to strategically hone our resources to make our FDA







response our top priority and any other internationalopportunities something we pursue a as the resources areavailable basis.

M a r c u s (ph) , does that answer your question?


Yes, thank you.

I have another question if no one else is on the line.


Well, there are about 151 others.

There are? OK.


Why don't you fire away M a r c u s (ph) , and I'll try to besuccinct.


Yes.

Just quickly, is there a possibility of getting fast track on yourproducts for compassionate uses?


Those are two things, different things.

First off ...

Operator

Please hang up and try your call again. If you need assistance,dial ...


Are we still online?

Operator

Yes.


OK, good.

So in terms of fast track, we're past the point of fast track 'causewe're well down the regulatory consideration phase here. Andso right now the FDA has been tremendously responsive towhat we're trying to do. And I assume that will continue to bethe case.

In terms of compassionate use, the company closed down itsU.S. compassionate use program I guess about three years ago.The problem with compassionate use is it's a very uncontrolledway to use the product. And frankly by its very nature it tendsnot be as helpful as you'd like it.


It's truly a last resort use of the product as opposed to a situationwhere a patient could really therapeutically benefit from it.

I will say I think as we look forward, we're probably going tore-review that issue. And see whether that isn't a smart thing todo.

However, any program we would do would have to be verycarefully constructed because an open-ended compassionate useprogram ends up required enormous resources. So the companyis we are responsible for how the product is used, the trainingof the medical personnel who use it, and inevitably as shouldbe and as is appropriate, for the recording the ultimate medicaloutcome to our fundamentally medical file.

So M a r c u s (ph) , there is another short answer to yourquestion.


Thank you.


But that is something we will look at again once we're confidentwe have - we are in very good shape on our BLA response.








All right, thanks.

Operator

Your next question comes from B r u c e P e t e r s o n (ph)with Janney Montgomery Scott.

Bruce Peterson - Janney Montgomery Scott - Analyst

What it's going to cost the company for this one time charge ofeliminating one-third of the employees? And give us a feel onhow the company is going to fund the timeframe going out toJune of '04 and beyond?

Thank you.


Sure.

The cost of the severance program will be the number that wehave right is about $985,000. So I think it's fair to say about amillion. That represents a little over 3% of the current cashresources we have on hand. With all that figured in, with cashon hand we're in a position where we could operate into theMay/June timeframe.

We are in discussions right now setting up a financial facilitywhich would allow us to raise the necessary resources to actuallykeep the company operating through the end of 2004. This isa so-called standby equity agreement - basically allows thecompany to sell shares as needed directly into the marketplace.We've used a standby equity facility already very successfullyover the past year, and we believe that, assuming we can onceagain renew this facility and we don't think there's an issue tothat, that we'll be able to, without doing a significant newoffering, be able to operate through the end of 2004.

Bruce Peterson - Janney Montgomery Scott - Analyst

Thank you.


You're welcome.

Operator

Your next question comes from G u d r i m B o w l e r (ph) ,an investor.

Gudrim Bowler - - Analyst

Yes, I have a question regarding the s a m p l i n g (ph) approachthat will not guarantee to meet FDA requirements. I'd like tounderstand why now at the eleventh hour it's finally figured outthat that approach won't work. Having listened to past speechesabout how people had been hired as consultants and employeesto "address the FDA needs and understand them," I'd like toknow how in the eleventh hour it's finally figured out that youdon't have even the approach that the FDA wants.


I guess number one I think all along we knew that thes a m p l i n g (ph) approach may or may not work. It seemedright to talk with FDA and w e (ph) in fact set up the meetingwith FDA within a couple hour - a couple weeks, rather, afterreceiving the letter. All along, we began our preparation toactually do the full source data collection, and in fact have keptgoing on that track even as we were having the discussions withFDA. And so I'm not sure it's eleventh hour because we've beenworking against this really since August.

Secondarily, I'd say while you characterized it as it's well knownthe FDA won't accept that approach, in point of fact the FDAhas accepted that approach and several other regulatory filingsthat we u n c o v e r e d (ph) in our research. And so it was notunreasonable to talk with FDA about the possibility of doingthat.

And in point of fact, the FDA didn't say, "We won't accept it."They just said, "You know, guys, we can't tell you until youshow us what you do whether or not it's going to work." Andbecause the last thing I want to do is get into multiple cycleswith FDA, we made the decision that we weren't going to putour shareholders at risk for having additional cycles with FDAbecause we didn't offer a complete enough answer to the FDAquestion.

So that's why we've gotten to this point. I know I can senseyour irritation in your voice about - in the use of the phrase"eleventh hour," but it would be unfair to say that we justsuddenly got surprised by this. We basically laid the groundwork







in place for full data collection starting off very early in theprocess. What we did do is we elected not to talk with ourinvestors about what the schedule would be until we were surewe had exhausted the option of getting a shorter path.

Should I - is there any more you'd like me to convey?


I'd like to know why you're not further along in South Africa.


There are fundamentally two issues. One is the company,frankly, did not do a full commercial introduction when theproduct initially became available there.

And then secondly, we took as our partner there a hospital chain,and as soon as we got into trying to start up commercialoperations there, it became clear that structurally a hospital chainreally isn't the right partner to have when you're marketing apharmaceutical. Lack of - there's both issues concerning lack ofexperience in marketing pharmaceuticals as well as, frankly,competitive issues between hospital chains in South Africa whichthe management of the company simply was unable to anticipate.

So now we're unwinding that agreement so we can get into amore normal commercial kind of operation.


Thank you.


You're welcome.

Operator

Your next question comes from Sapna Srivastava withThinkEquity Partners.


Yes, hi, Tom. I have a few questions.


Yes?


First of all, with the change in regulatory, I mean, who is goingto be the person who is responsible for now c a r r y i n g (ph)the communications with the FDA? I mean it is a bit concerningto change at this point of the game. And how does the newperson plan to get trained in the time, you know, which is prettyclose? I mean even if it's a few months, it's pretty close to reallyunderstand the last, I don't know, 1 3 (ph) years of work orsomething. So a little bit of color on that would be very, veryhelpful. I would start with that and then I have a few morequestions.


Sure. David Zuchero will be our chief regulatory contact withFDA effective today. We have notified the agency of thatchange. Nevertheless, I will emphasize David is - brings anenormous wealth of experience and strategic perspective to us,but it is our aim to hire a new senior regulatory officer who willassume that communications responsibility as soon as we findthe right sterling individual who'll take that role.


I mean just you know level will not have a regulatory personwhile the product is under review. I mean who in the companyis going to be r e g u l a t o r y (ph) responsible for any questionsthat are coming from the FDA right now?


Well, we actually do intend to work through David for rightnow. I mean we have a regulatory team of six individuals whohandle our regulatory process, and so it's not like we have anysudden void in terms of regulatory relationships with FDA orregulatory history with FDA. And again, I would emphasizethat Howard was not running the FDA response process. Inpoint of fact, I'm running the FDA response process andcoordinating the work amongst the teams. The communicationwe sent to FDA announcing - informing them of the changewas a letter that I signed personally.

And so Howard's leaving does not affect our ability to make theresponse. In terms of the communications with FDA, as you







know, they - I mean they're fairly formalized interactions backand forth at this stage. They're not particularly intense at thispoint because we're busy getting them the answers. We've doneall the clarification - with Howard's help all the clarification weneed to know what we've got to do and to know the extent ofrigor we have to apply to it.

And so from our perspective, Sapna, this is a - this is anopportune time to make a change at what is broadly perceivedas a sensitive spot, but it will not represent a gap in terms ofability to keep track of the history or ability to be able tocommunicate effectively with FDA.


OK, and the second question is, you know, obviously yourtimelines have slightly extended from the last time you gave theupdate on what it would take to get the response to the FDA.I mean could you just give a little bit more color, like, youknow, why the timeline extended and how many people areworking on getting the answers? Could this timeline beaccelerated if you had more people trying to get the answersinformation, et cetera?


Sure. We actually - I mean we provided some guidance brieflyright after we got the letter which in part was based on theassumption that we had all the source data the FDA will belooking for already in house. And that was literally within thefirst 24-48 hours after we got the letter.

As we got into what the FDA is really looking for, we realizedwe would have to go out to the sites in order to collect thatinformation and that's when we - when we provided theguidance at our Q3 conference call which said, "Gee, we needto have a meeting with FDA and we'll only know when exactlywe're going to be able to set a timing commitment after wehave those meetings with FDA." And so early on, we thoughtthis would be easier because we had the data in house. It tookliterally a few days because you have to work with your contractresearch organizations and your data management organizationsto find out exactly what you have. We discovered, "OK, thisreally is going to be a field trip."

How big a field trip will it be? Well, on the data gathering areaalone, we have retained and trained 15 or so monitors to go outand actually collect the data. We've now contacted the vastmajority of the sites and the - and they are - some are sending

us the information directly. Others need to get visited by folkswho know what to look for to be able to pull that informationout. And so it represents a very substantial effort.

Once the material is in, we have to take the data out of theforms and tabularize it in the way the FDA has asked to see ittabularized to be able to do that. And of course, we have to dorechecking of it to make sure everything we send is accurate.

So it's a collection process which in our - in our timeline, atleast, we're assuming is going to take several weeks. Then there'sa data extraction process, which we can start almost right awaywhen we get the source data in though it will still take sometime to take it out. Then there's a checking and verificationprocess and a tubularization process, and, frankly, we're alsogoing to just make sure all of this reconciles well with everythingwe already have in house. And that's what pushes this timelineout.

Again, it's critically important for our investors that the timingpromise we make is the one we meet, and that's what we'regoing to do. The issue here is probably while we could go from15 monitors to 30 or 45 monitors, that only shortens up thecollection process. There are several other steps we have to take.So if it were - frankly, if it were just the number of monitors,I would be - right after we finished this call, I'd have my tickethopefully to Miami, but I fear that my staff would probably sendme to Minneapolis instead, to actually pick up the data. But it'smore to it than that.


And so how is that to extract the data from because obviouslyyou're giving up control now for the data collection being havingto actually go to the sites? I mean would that be a challenge?And I mean is that the only part of the questions which are stillw h e r e (ph) you have to answer to the FDA or are there anyquestions on the efficacy and safety side which may be also moretime consuming?


In previous communications we've had, we've said there of the- all the questions we've gotten, there are about 50 which, youknow, require some substantial effort on our part. None of thoseare going to be time-limited. We've focused on the source datacollection because that's the one that takes all the time. The restof them we're confident we can answer, and in fact, many ofthe answers have already been finished.







We for the sake of simplicity have focused on the sourcecollection issues as being the one which will effect the issueinvestors are most concerned about, namely the timing of ourresponse. But there are lots of other questions being answered.It's fair to say the majority - the vast majority of thenon-manufacturing resources of the company are working onthose questions. Though that'll start shifting over in the nextfew weeks as people complete the answers and can move backto other aspects of the business.

There was another aspect to your question. So far, and we'repretty far down the track, sites have been very cooperative withus in terms of getting this data back. There are both issues abouttheir voluntary nature their cooperation. There've also beennew confidentiality regulations and laws passed, notably HIPAA,since our trial began, which for some sites we thought couldcreate a problem. And so, so far, I guess I'm pleased by what Isee so far in site responsiveness. And if that continues to be verygood, then I'm going to be even more comfortable about ourJune target date. But at this point - at this point, it's really so far,so good.


OK. And my last question - I apologize questions - butmanufacturing, you've obviously, you know, reduced yourmanufacturing team by 90%. I mean assuming approval ...


I'm sorry, Sapna, I miscommunicated then. I'm glad you saidthat. Ninety percent of the cuts come in manufacturing, butmanufacturing force overall was reduced by I guess - I'd say it'sabout 40%.


OK.


So it's a 40% manufacturing staff reduction, but they accountfor 90% of the individuals we've laid off.


So, but, I mean if you need to build it back towards the end ofthe next year, I mean, how much time would you need? And,like, also how does this impact South Carolina, you know, goingforward manufacturing plant facilities?


The way we structured it, and we made some very consciouschoices on this because you can imagine there were alternateplans which have had a more dramatic effect on manufacturing,we structured it so that we would be able to build back quiterapidly. We have conscientiously retained the individuals withthe highest degree of skill and experience in the organization.

And so we've done it in a way where we can really build backquite quickly and that was an important criteria laid out i nt h e b o a r d (ph) when w e (ph) did this. Again, this was alldone not to hit a financial target but on a strategic way to say,"What capabilities are we going to retain? What are we goingto give up?" And that's the way we've approached it.

And ...


South Carolina.


... so we did that across the board both in the manufacturing aswell as in our quality control and quality assurance sides whereall the - all these organizations were left staffed in a way wherewe could staff up quickly.

In terms of Sumter, the Sumter Realty Group, which you knowis the organization that's actually doing the financial negotiationwith us, is engaged in active financial negotiations. We haveinstructed them to continue to do that. We have not movedaway from the possibility of doing the Sumter agreement andhopefully they will have some news for us on that in therelatively near future, but that's not a negotiation we're engagingin directly ourselves.


But do you think your manufacturing plant will also be impactedby the same amount of delay, in terms of timeline?








No, we don't think so. It'll take three years from the point wherethe shovel hits the ground to the point where the facility is upand running. And because our perspective on the approvabilityof the product is unchanged and because three years is a long,long time, we still think that it makes sense to move for themup-front.


And to the extent, Sumter, they're much like any other investors,the people that they're negotiating the financial agreement with.They want the questions answered; they want to understandthe basis of what this call is. There might be a little shock at first,then maybe relief that we have a plan and a path movingforward, and then it's back to business. So that's the differentperspective.


Okay, thanks so much. I will say goodbye.


Thanks Sapna.

Operator

Your next question comes from D a v e H o f f m a n (ph) withA c c e p i t o r (ph) Capital Management.

David Hoffman - Accepitor Capital Management - analyst

Hi, thank you very much for taking the question. I was justcurious, what exactly was the day on which the head ofregulatory R i c h m o n d (ph) left the company.


As a matter of fact, it was late last week, and to be honest withyou, I don't recall the exact day. It was late last week.


Okay, and just regarding the standby equity distributionagreement. Would that be similar to the Bank of New Yorkagreement in structure?


Yes.


Okay, so just to clarify, these are essentially purchasing stockfrom the company at a discount. So the market profit--


Actually the way it works, it's the facility which allows thecompany to sell stock directly into the marketplace. There's avery small commission, it's 1% commission. So technically sir,you are right, it's a discount but it's only a discount of 1%. It'snot anything beyond that.


So just one other question. Did the head of regulatoryR i c h m o n d (ph) , was that departure, was he terminated orwas that departure voluntary at this point?


Well, Howard's a respected professional so I think the precisecircumstances of hwo all this happened is sort of personal. I guesswhat I will say is that was something that was reached by mutualagreement. He did not choose to leave us, let's say.


Finally, if you could just give us a sense of what time any sortof charges might be taken with the workforce reduction?Assuming that happens by end of 2003, not including the standbyfacility, just what the end of 2003 cash balance might look like?


I think my CFO won't let me give you the cash balance, butwhat we can say is... One, all the charges will be absorbed by







the end of 2003. And two, that with all those charges in, we'llstill be a position with cash currently on hand to operate throughprobably through either late May or early June.


Right, and the facility would take you through the end of 2004?


Exactly.


Great, well thank you very much. Best of luck.


This is Douglas. I think we can take two more questions andthen we have other obligations today. We can talk individuallyafter that. For those of you on the call, you may want to makea note that our earnings call and press release are on theDecember 11th. We may have other things to say before that.But do more two more questions, and then we'll end this call.

Operator

Your next question comes from J a k a r B o z (ph) withGreenberg Healthcare.

Jakar Boz - Greenberg Healthcare - Analyst

Hello, can you hear me?


I can barely hear you but I'm listening as carefully as I can.


Okay. I just wondered if you could walk us through thetimelines and milestones between now and June that would givethe impression to the investors that these issues have beenresolved with the FDA, and that the items that the FDA wouldlike from you have been obtained by your research peopleadequately. Whether you meet those guidelines in line with

what the FDA has requested. Between now and June is a bigblack box, I mean. Do you have any idea what's going to happenuntil June and until the FDA accepts it afterwards?


I understand, and I'm quite sure that during this period, we'llbe providing investors with regular updates of where we thinkwe'll stand and how we're doing on this. The key issue is sortof as I described: the three phases of what we have to do withgathering the source information. First the gathering per se. Andwe've allowed ourselves between two and three months tocomplete the gathering process. And then data extraction andtabulation process, and then it's just finally summarization andthe other kind of things we have to do with that. And so--


No, I'm not asking that part of the question, we can all collectdata. But what I'm wondering is that the data and the collecting,to begin with, is the appropriate data? That the FDA will finallyfind it adequate and satisfactory?


We know exactly what the FDA is looking for, and we're quitesure we can collect it. And from that standpoint, quite frankly,we don't have much concern about whether or not the principalwork we're doing here is the right work to do. I think the morefundamental question that you are interested in as everyone is,is this answering all the FDA questions. Is this going to beeverything the FDA could possibly want in order to moveforward with an action letter? The FDA has used with usrepeatedly the phrase that "This is the roadmap" for where weneed to go to move forward, and we're taking them not just attheir word but based on the repeated correspondence with themthat that in fact is exactly what we're doing.

And so we will - we will, as we develop our lists, we'll also,we'll be working with FDA to make sure we are getting all theissues they have, even the ones they may not - that may not bein the letter. But at this point, what they said is hey, the letteris everything. Give us what we ask for and we'll be movingforward.

So that's what we're focused on. I appreciate, you know, it'd begreat to have a lot of other little milestones but it really is gotto answer all their questions and that what we're doing.








OK. So are they keep us in this change recently? Because hisappreciation of what the FDA were different to what the FDAis willing to put on writing and other receipt in writing. Wereyou going to address the issues of the new regulatory person onboard?

I'm not quite understanding why the change in managementwas made if we indeed have everything down right from theFDA already. I'm a little confused.


There's absolutely no issue about his interpretation of what wehave to do and the company's interpretation or for that matterFDA's interpretation.

It's really a very explicit roadmap.

The change there was done for issues, which are - the changethere has nothing to do with the FDA response. It has more todo with where we feel we need to go as a company. And someof the other strategic issues we want to address and the kind ofresources we want to bring in to expand the scope of what we'redoing.

And this was an opportune time to make that change becausewe had just completed all the dialogue with FDA overclarification on alert. A dialogue, which was very productive,raised no new issues. Simply said, guys, sample in one field, atleast our conclusion from it was that it was in the best interestof the shareholders not to take a sampling approach but to goout and get it all the data.

But I really do want to emphasize, 'cause your question is oneI know that a lot have, is that this has nothing to do with theFDA response letter. And because H o w a r d (ph) was notmanaging the response process, it doesn't impact our ability tomake that response happen in a timely fashion.




You're welcome.


OK. We can do one, maybe two. I know there's people at thetop of the queue that have been waiting a long time.

If we can fit two in quickly, let's do that.

Operator

Your next question comes from K e v i n T a n g (ph) withT a n g C a p i t a l (ph) .

Kevin Tang - Tang Capital - Analyst

Thanks for taking my question.

I'm - can we discuss a little bit, you're going to go out in thefield and gather the raw data, case report forms, et cetera. Therehasn't been much discussion about, gee, what are you going tofind in those data?

Presumably if you find something, presumably you're going outto look to gather that data for a reason. And the reason mightbe there may be potentially some discordance with the datayou've presented to the FDA?

And if so, then would that then not trigger another trialrequirement?


I don't think it would trigger another trial requirement. ThoughI'm, when I last checked my business card I don't work for FDA.But we don't think it's going to show - we don't think it's goingto show any difference in the data.

But if it were to do that then I suppose the one thing we'll dois kind of look and see if there is any difference, whether it'ssignificant or not. We don't expect it will be.


OK. But if there was not a possibility then of course wouldn'tbe any need to go collect it, right?

I'm just trying to understand why would they have you gocollect this data unless there was some suspicion that there mightbe a difference?








I really can't speculate on why they'd ask us to do that. All I cansay we know, we don't think there's any difference and I'm notsure that they think there is any difference. But they are askingus to do that.


OK. And then when you re-file, that triggers a six-month or a12-monnth-review time?


If the FDA chooses to classify this is a class two resubmission,and again I can't say what FDA would do, then that would bea six-month response time.


OK. And if they don't it would be how long?


It would be less. You have your choice of six months or less.


OK. So there's no way it would be more than six months?


Not under FDA regulations. But I will emphasize the FDA havelots of options to do what they feel they can do.

But under P e d u f a (ph) , at most it's six-month response time.


OK. OK. And then one last question and I - you probablydiscussed in the past. The delays of manufacturing facility build,obviously understandable given their capital requirements ofthat and so on, give what's going on.

But what would be your capacity to launch, what is your currentmanufacturing - what if your manufacturing capacity short ofbuilding a new plant I guess is what I'm asking?


Sure. The current, the machines we currently have in place giveus a capacity of about 75,000 units per year of Hemopure.


OK. And then ...


Even though we're doing a staff reduction, OK? The staff inplace will be continuing on projects that we have, we alreadyhave in process, which will allow us to ultimately increase thecapacity to 95,000 or so units a year.

And while that process will go on a little slower, that processwill continue going.

So our anticipation is upon approval we'll have capacity of95,000 units a year. And we hope we will have our Sumterfacility under construction so we will heading to add anincremental 500,000 units of capacity not too long after productlaunch.


OK. And that's, I should think about that as kind of a 30, 30odd million-revenue capability at launch?


I think it's higher than that. I think we would say it's closer toa $60-70 million revenue capability.


OK. All right. So we don't have to get in that now, but that'sassuming something like a 200% premium to blood costs?








We could have a very interesting discussion on what blood reallycosts, in our view that would represent roughly a 30-40%premium only.


OK. And the one last question and I'm needing the story, butI'm just trying to dot all the i's here.

Is there any litigation risk in the, any litigation undergoing thatyou can update us on, if there are and if not, great?


There's, well there's only, there's one litigation going on andthat relates to - I'm getting a little advice here on how to exactlyhow to go. It's a contractual issue, it's a contract case that's beinglitigated. It has nothing to do with the conduct of the business.

So to give you a straightforward answer to your question isthere's one piece of litigation currently going on. And it is inour 10-Q.


OK.


So beyond that there is no other new litigation activity goingon.


And just the timeline of that? Is it resolving in this next year or...


Oh, yes. Yes, this is - this is one, well I won't characterize thecase. All I'll say is it's not too complex and so I think ultimatelyit's going to be - it's going to rest on the parties deciding whatthey really want to do to get this out of the way.


And have you factored that into your cash lasting 'til the end of'04 scenario?


We really can't predict what'll happen with that. And so theanswer is we haven't - we haven't put in a particular figure onthat but at the same time we don't think it's appropriate.

So that's really all I can say about it at this point.


OK. All right. Thank you.


You're welcome.


OK. Let's do one last call and then we're going to have to moveon. We have other obligations that are about to start. So that'llbe it. One more please.

Operator

Your final question comes from S t e v e n M a r k s (ph) withBlue Ridge Capital.


Hi, S t e v e n (ph) .

Steven Marks - Blue Ridge Capital - Analyst

How are you doing?

Hey, just so I understand a little bit better, you made the pointa couple of times that how, I was just more interested in howwas the SVT of regulatory affairs not managing the process withthe FDA?








I don't think he said he wasn't managing the process.


OK.


He certainly was the managing the process of the FDA. WhatI said is he's not managing our response, OK? Because theresponse represents the work of a lot of people ranging fromour clinical folks who are out collecting this data and arrayingit and the statisticians who work with it. Our medical personnelwho are dealing with medical interpretation discussions and thelike, our manufacturing people, while we've got very fewmanufacturing questions there were a few. Even our currentmanagement people are answering candid, intimate questionsabout cows, OK?

So this is not the answer in its final form will pass throughregulatory because regulatory will ultimately say yes this is theright format, the right way to answer this question and assistthen with our total regulatory strategy. And so from thatstandpoint, you need regulatory leadership.

But frankly, this is a project that requires good projectmanagement and management from me because the answer intothese questions requires allocation of company resources andmaking sure everyone's making this job one.

And so Howard was not managing that total process. He wasworking with me on it. He was working with an in-houseproject manager we have to do that.

But the preparation of these answers goes well beyond simpleregulatory expertise. There was expertise from all over thecompany being employed. And it's a key task we have as acompany today.

So I've got to be on top of that.


But he was managing the intimate process with the FDA, I takeit?


Yes. But it's not very intimate at this point because we had thediscussions and the clarifications. The intimacy of the processright now is here's the list of questions it's, you know,hammered, nailed to the door like Martin Luther's principlesand now we're going to answer them.

So it's not a nuance situation with FDA at this point. It's reallya delivery thing.

I mean we've already answered many of the questions. We'vegot many more to finish up and that's - and that's a generalmanagement process. It's not an FDA relationship thing 'causewe're going to send FDA all the answers in one load.


OK. And a couple more questions, you guys have said that the,there are kind of 50 substantive questions. How long was theletter that the FDA sent you guys?


That actually was about 35 pages.


OK.


Which is typical in its breadth and content for a major newproduct application.


OK, and then on South Africa, how many or two questionsthere. You guys said that the partnership has real issues. I justwanted to delve down and to understand what some of thoseissues were.

And then the second part of the question was how many unitsof the original, I think it was one to 2,000 units that you allshipped over, still remain to be used?








Sure. I'll put it in graphic terms as a businessperson, S t e v e n(ph) you can appreciate.

Imagine my reaction when my South African team says we justpaid a call on the number-two hospital chain in the privatesector in South Africa and they said quote, "So long as you havethis partner, we'll never buy a unit from you guys."

And the third biggest chain said the same thing.

And in fact they said basically none of us are going to buy a unitfrom you guys so long as you guys have this particular chain asyour partner. I think you'll agree this is a major commercialissue.

And that's the one we're faced with.


OK.

But let's say how into rolled were they in getting the productapproved? I take it from my recollection they and then the, Ican't remember what they were called, the - there's anothergroup that sounded like they were pretty integral in getting theprocess approved.


That actually isn't the case. Let me say one thing about my earlierlittle anecdote. I tell you this story but I want to make it clearit is the competitive reality how business appears to be done inSouth Africa.

It doesn't necessarily reflect badly on our partner as a company.It's just the way it is.

So having given you that small disclaimer, S t e v e n (ph) yourquestion was, I apologize. Could you repeat your question?


I'm trying to understand how integral they, and there was a,there was like a ...


Actually we had for all intents and purposes, it appeared we had,as I've been told. I was not here on that happen, that we basicallyhad the approval in hand when we in fact formed thispartnership.

We in fact initially made the filing with another company therecalled MC Pharma.


Yes.


The filing was done with MC Pharma, not with this partner.So this partner is really with us on the commercial end. It wasnot with us with the filing at the regulatory end.


OK, and then the number of units that still remain in SouthAfrica?


Approximately 850.


And what the original, 1,000 or 2,000?


Two thousand.


OK. And then one last question for you, when you all initiallyannounced the FDA letter, you all said that the clock wasstopped and the FDA and you thought the FDA would respondwithin a month.

And now that doesn't seem to be the case. I'm just trying tounderstand what happened there.








You're right, S t e v e n (ph) . I think - I think, we questionedthat closely when it occurred and we termed the letter as ahybrid because it was, the language, frankly, was a little confusingto us in terms of where all that stacked up.

And because they were early in responding and because theyused the phrase we have stopped the clock, our interpretationof that was when you stop the clock it means the clock getsrestarted.

I think now as we look at the, actually the phrase they used waswe suspended the clock. And so when you suspend somethingthat means you can restart it again.

As we get into how, into however the depth of the responsewe got to provide and continue to have interactions with theagency, I think it's fair to say that when we respond, they'llrestart the clock. But the clock probably won't have 30 days onit. And frankly it'd be unreasonable to expect it could 'cause thisresponse is not going to be a five-page letter with a one-pagecover note.

It's going to be much more comprehensive than that.

So I think it's fair to say that in the first couple of days of Augustwhen we were trying to communicate this immediately andquickly as possible, the ambiguity of the letter led us to servean ambiguous outlook on what it really meant.

So we tried to clarify that since.


OK. Thanks for the help.


Thank you, S t e v e n (ph) .

OK. So we'd like to thank everyone for joining us today. Andwe look forward to talking to you soon.


Thank you all very much.

Operator

Thank you for participating in today's teleconference. You maynow disconnect.

D I S C L A I M E R











Exhibit J



Search -18 Results -biopure Page 1 of 3

TheStreet.com October 30,2003 Thursday

Copyright 2003 TheStreet.com, Inc.

TheStreet.com

TheStreet.com

October 30, 2003 Thursday

SECTION: TECH STOCKS; Adam Feuerstein

LENGTH: 1275 words

HEADLINE: Time Not on Biopure's Side

BYLINE: By Adam Feuerstein, Senior Writer; Adam Feuerstein writes regularly for ReaIMoney.com. Inkeeping with TSC's editorial policy, he doesn't own or short individual stocks, although he owns stock inTheStreet.com. He also doesn't invest in hedge funds or other private investment partnerships. He invitesyou to send your feedback.

BODY:This is a bonus column from Adam Feuerstein, whose commentary usually runs only on RealMoney. We'reoffering it today to TheStreet.com readers. To read Adam's commentary every day, click here for informationon a free trial to RealMoney.

In two-plus years following Biopure (BPUR: Nasdaq) and its faulty experimental blood substitute Hemopure,I've been most surprised about one thing: the capacity for some investors to remain bullish despite theweight of evidence to the contrary.

After the torrent of bad news released by the company Thursday, I wonder how even the most obstinate ofBiopure bulls could have any confidence left at all. The credibility of Biopure management is in question,and the odds of Hemopure's eventual approval seem more remote than ever before.

Thursday, Biopure acknowledged that it would be unable to respond until the end of June 2004 to the Foodand Drug Administration's request for additional information on Hemopure --a significant delay. Thecompany also fired Howard Richman, its top regulatory executive in charge of the Hemopure filing, andannounced large-scale layoffs and cost-cutting because its bank account empties out in June.

All this bad news sent Biopure shares tumbling Thursday $2.37, or 39%, to $3.68

That's a tough break for Biopure shareholders, who have loyally kept the stock price up despite years ofdisappointing delays. One shareholder, however, who has done well recently is Biopure co-founder, formerCEO and current CTO Carl Rausch, who was able to sell more than $1 million worth of his Biopure holdings

this summer when the stock was trading in the $7 range.

Biopure has said that Rausch's stock sales were not related at all to Hemopure's regulatory situation. Buttoday's announcement, coupled with Rausch's insider status, should raise new concerns about the timing ofthese stock sales. .

Biopure executives did not return a phone call Thursday seeking further comment.

Let's address the FDA timeline, first. June seems a long way off, especially compared to the confident tonemanagement took last Aug. 1, when it announced --rather triumphantly --that the FDA had completed itsHemopure review, but had requested a bit more clinical information before it could issue a final decision. Atthat time, CEO Tom Moore told the Boston Globe that a response to the FDA would take one or two months


Page 2 of3Search -18 Results -biopure

to compile. Later, as fall rolled around, that timeline from Biopure stretched to three or four months.

Now, Biopure says that it will take 11 months from the receipt of its FDA response letter to provide theagency with the information requested.

Back in those heady days of August, Biopure management assured that its relationship with the FDAcouldn't be better. The company insisted that regulators actually completed its Hemopure review one monthearlier than expected, and that it would take just 30 days to issue a final decision on the product (a hint thatit likely would approve it) once it had a chance to go over the new Hemopure data.

Thursday, Moore acknowledged that the FDA would in fact take a lot longer than one month to issue adecision. It will likely take at least six months, possibly even longer, Moore now says.

This means that if Biopure can meet its new June 30 deadline for an FDA resubmission, an answer fromregulators wouldn't come until the end of December 2004. But how can anyone have any confidence inBiopure's timeline? The June 30 date seems entirely arbitrary, because the company admitted yesterdaythat collecting all the data requested by the FDA will be a time-consuming and arduous task. Biopuredoesn't even know if all the data is collectable. And no one knows how long the FDA will really take to

respond. Six months? Twelve months? Longer?

Why was Howard Richman fired from Biopure? Biopure said in its press release that he left the company to"pursue other interests." But on its conference call Thursday morning, CEO Moore said, "Let's just say that

he didn't choose to leave us, per se."

Richman was Biopure's senior vice president of regulatory affairs, and as such, was the primary pointperson dealing with the FDA. He, more than any other Biopure executive including Moore, was in a positionto understand the full extent of the agency's feelings about Hemopure and likely knew more than anyone

how much work would be required to compile the information requested by regulators.

But Thursday, Biopure tells us that Richman was fired, and at arguably the most critical juncture in thecompany's history. Moore offers no explanation for the firing. The company has retained an outsideconsultant, David Zuchero, to take up the regulatory slack, but he's coming into a red-hot situation ice cold.

When did Biopure really know that the work ahead of it on Hemopure was going to be far more dauntingthan it first realized? It's an important question, given the company stock sold by insiders, including former

CEO Rausch, during the summer months.

On the conference call Thursday morning, Moore said the Hemopure review letter sent by the FDA to thecompany on Aug. 1 contained "language that was, quite frankly, confusing to us."

At other times during the conference call, Moore acknowledged that the company knew the FDA'sinformation request was going to be time-consuming, but that it was negotiating for short cuts, which

ultimately failed.

But if the company had come clean about its timelines in August, when it first heard back from regulators,the company's stock price likely would be closer to today's level than the $7 to $8 range it traded at over the

summer.

The higher price benefited Biopure insiders selling stock. On various dates from Aug. 5 through Aug. 28,while CEO Moore was telling investors how well the FDA review was progressing, Rausch sold 149,500 sharesof Biopure common stock, at prices ranging from $7 to $8 per share, with net proceeds exceeding $1.1million. Moore also sold some company stock, as did members of the board of directors.

On its fiscal third-quarter conference call of Aug. 21, Moore addressed the issue of insider selling, saying,"Our co-founder and Chief Technology Officer Carl Rausch is continuing to sell a relatively small portion of hisBiopure holdings in order to meet his personal financial needs. He publicly announced his intent to do so, in


Search -18 Results -biopure Page 3 of 3

fact, some time ago."

Finally, Biopure, once again, is desperately short of cash. Even with the layoffs and cost-cutting announcedThursday, the company only has enough cash to last through Mayor June. Biopure is trying to renew anequity stand-by agreement that would allow it to sell another $15 million in stock to the public. If successful,the new cash would last through December 2004.

Who would actually buy Biopure stock right now? Short-sellers and arbitragers, of course, because it's aneasy way of covering at least a portion of their short sales and pocketing instant profits. "Biopure is like anATM," one short-seller joked to me today.

Biopure longs, especially retail investors, should keep this in mind before they argue how Biopure'scontinuing ability to raise cash represents some sort of validation and confidence in its blood substitute.

In fact, Biopure could be living on borrowed time. In some perverse way, it actually benefits the company todrag out its FDA response as long as possible, so don't be surprised to see the new June deadline getextended once again. Right now, Biopure controls the clock, but once it responds to the FDA, regulatorsgain control, and that might finally bring this long, sad story to an end.

LOAD-DATE: November 1, 2003

Source: News & Business > ~ > $ News, Most Recent Two Years (English, Full Text) QTerms: biopure (Edit Search)

Mandatory Terms: date in-between 10/30/03 : 11/1/03View: Full

Date/Time: Thursday, July 1, 2004 -11 :20 AM EDT

~

7/1/04


Exhibit K



Page 1 of 2

Biopure Corporation (ticker: BPUR, exchange: NASDAQ) News Release -12/24/2003

Biopure Receives 'Wells Notice' From Securities and Exchange Commission

CAMBRIDGE, Mass., Dec. 24 /PRNewswire-FirstCalV --Biopure Corporation (Nasdaq: BPUR) reported that on December 22, 2003, itreceived a "Wells Notice" from the staff of the Securities and Exchange Commission (SEC) indicating the staffs preliminary decision torecommend that the SEC bring a civil injunctive proceeding against the company. As permitted under the Wells process, Biopureintends to respond promptly and thoroughly in writing before the SEC staff formally decides what action, if any, to recommend. Thecompany's chief executive officer and its former senior vice president of Regulatory and Operations also received Wells Notices.

Biopure believes the notices relate to the company's disclosures concerning its communications with the Food and Drug Administration(FDA) about a trauma study protocol the company submitted to the Agency in March 2003 and about the company's biologics licenseapplication (BLA) for Hemopure(R) [hemoglobin glutamer -250 (bovine)]. The company did not publicly disclose its communicationswith the FDA about the proposed trauma protocol and investigational new drug application (IND) because it does not believecommunications about proposed clinical trials are material prior to the initiation of a trial. This trauma trial was not initiated in theUnited States and no product was shipped under this IND. Biopure also believes that its disclosures about the BLA are accurate. Thecompany will continue to cooperate with the SEC staff.

Biopure submitted the trauma protocol for a Phase II clinical trial ofHemopure for the treatment of hemorrhagic shock casualties in thehospital setting, where red blood cell transfusions are available. The FDA placed this trauma protocol under a new IND that is separatefrom the company's previous IND and its BLA to market Hemopure for the treatment of acutely anemic adult patients undergoingorthopedic surgery and for the elimination or reduction of red blood cell transfusions in these patients. The protocol sought to administerup to 15 units of Hemopure, a proposed dosage that was 50 percent higher than administered in previous clinical trials.

After the in-hospital trauma protocol was submitted to the FDA and the new IND was assigned, the Agency placed a clinical hold on theproposed trauma trial due to safety concerns. The FDA referred to a review of adverse event data from the company's Phase IIIorthopedic surgery trial, which was submitted in the BLA. The data from that Phase III trial has been previously presented at medicalmeetings.

In May 2003, Biopure responded to the FDA's clinical hold and also filed the response as a BLA amendment because it discussed datapreviously submitted with the BLA. That amendment resulted in the FDA extending its BLA review period up to 90 days, as previouslyannounced on May 30, 2003. The Agency also requested three additional pre-clinical animal studies of Hemopure in conscious swine toaddress its concerns regarding high-volume administration. After the company's responses, the FDA has twice declined to lift theclinical hold, most recently in a letter dated July 30, 2003. This letter is separate from the FDA complete response letter Biopurereceived on that date in response in to its BLA for orthopedic surgery. The questions in the FDA's trauma letter were the same as someof the questions in the BLA complete response letter and had two additional questions, one about the company's analysis of age-specificeffects in individuals over age 75 in the Phase III orthopedic surgery trial and a second question about dosing.

Biopure submitted a similar study protocol for in-hospital testing ofHemopure in trauma patients to the Medicines Control Council(MCC) in South Africa. The MCC approved the protocol after modifications including lowering the maximum dose of Hemopure. Inaddition, the company continues to work with its trauma advisors, including military and academic researchers, to develop a clinical trialprotocol, with funding from the V.S. Department of Defense, to test Hemopure in trauma patients in an out-or-hospital setting whereblood is not available. The company believes that the risk-benefit ratio is different in the out-or-hospital setting. The company haswithdrawn the V.S. in-hospital trauma protocol that was on clinical hold while it continues to develop its trauma program.

A Biopure-requested meeting has been scheduled with the FDA on January 6, 2004, to discuss the BLA. If there are significantdevelopments at or following this meeting, the company intends to report them promptly. Biopure still expects to respond to thequestions in the FDA's complete response letter by June 30, 2004.

Biopure Corporation

Biopure Corporation, headquartered in Cambridge, Mass., develops, manufacturers and markets oxygen therapeutics, a new class ofpharmaceuticals that are intravenously administered to deliver oxygen to the body's tissues. Hemopure(R) (hemoglobin glutamer -250(bovine)], or HBOC-20l, is an investigational product in North America and Europe and is approved in South Africa for the treatmentof acutely anemic surgical patients and for the elimination, delay or reduction of red blood cell transfusions in these patients. In July2003, the U.S. Food and Drug Administration (FDA) sent Biopure a complete response letter regarding the company's biologics license

7/21/04http://www .corporate- ir .netlireye/ir_site.zhtml ?ticker=BPUR&script=411 &item_id=4803 87 &layout=23


Page 2 of2

application to market Hemopure in the United States for a similar indication in orthopedic surgery patients. Biopure is currentlypreparing a comprehensive written response to the FDA's questions. Oxyglobin(R) [hemoglobin glutamer -200 (bovine)], or HBOC-301, is the only product of its kind approved by the FDA and the European Commission for the treatment of anemia in dogs.

Statements in this press release that are not strictly historical may be forward-looking statements. There can be no assurance thatBiopure Corporation will be able to commercially develop its oxygen therapeutic products, that necessary regulatory approvals will beobtained, that anticipated milestones will be met in the expected timetable, that any clinical trials will be successful, or that anyapproved product will fmd market acceptance and be sold in the quantities anticipated. Actual results may differ from those projected inforward-looking statements due to risks and uncertainties that exist in the company's operations and business environment. These risksinclude, without limitation, the company's stage of product development, history of operating losses and accumulated deficits, anduncertainties and possible delays related to clinical trials, regulatory approvals, possible healthcare reform, manufacturing capacity,marketing, market acceptance, competition and the availability of sufficient fmancing to support operations. The company undertakes noobligation to release publicly the results of any revisions to these forward-looking statements to reflect events or circumstances arisingafter the date hereof. A full discussion of Biopure's operations and fmancial condition, and specific factors that could cause thecompany's actUal performance to differ from current expectations, can be found on the company's Web site atwww.biopure.com/corporate/legal/home_legal.htm and in the company's filings with the U.S. Securities and Exchange Commission,which can be accessed in the EDGAR database at the SEC Web site, www.sec.gov, or through the Investor section of Biopure's Website, www.biopure.com.

Contact: Douglas SaylesBiopure Corporation(617) [email protected]

SOURCE Biopure Corporation12/24/2003

CONTACT: Douglas Sayles ofBiopure Corporation, + 1-617-234-6826, or [email protected]

Web site: http://www.biopure.com(BPUR)

7/21/04


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