1

June 12, 2009

Dainippon Sumitomo Pharma Co., Ltd.

June 12, 2009

Dainippon Sumitomo Pharma Co., Ltd.

Lurasidone MeetingLurasidone Meeting

2

Lurasidone: Clinical Studies SummaryLurasidone: Clinical Studies Summary

Antony Loebel, MDVice President, Clinical DevelopmentDainippon Sumitomo Pharma America

3

Lurasidone Development Timeline

20082008 200920091990-19951990-1995 200720072002200220002000 20042004 20052005 20062006

First in Man

(Japan)

First in First in ManMan

(Japan)(Japan)

US Schizophrenia IND

US Schizophrenia US Schizophrenia IND IND

US Schizophrenia NDA

US Schizophrenia US Schizophrenia NDANDA

SchizophreniaPhase 3

SchizophreniaSchizophreniaPhase 3Phase 3

SchizophreniaPhase 2

SchizophreniaSchizophreniaPhase 2Phase 2

Schizophrenia Pre-NDA Meeting

Schizophrenia Schizophrenia PrePre--NDA NDA MeetingMeeting

Bipolar Depression Phase 3

Bipolar Bipolar Depression Phase 3Depression Phase 3

EOP 2 FDA Meeting

EOP 2 FDA EOP 2 FDA MeetingMeeting

Lurasidone Discovery

(Japan)

Lurasidone Lurasidone Discovery Discovery

(Japan)(Japan)

20102010 20112011

US Bipolar Depression

sNDA

US Bipolar US Bipolar Depression Depression

sNDAsNDA

MerckOutlicensed

4

Problems with Current Antipsychotic Agents

Lack of efficacy

EPS/akathisia

Prolactin increase

Metabolic syndrome• Weight gain• Lipid increase• Diabetes

QTc prolongation

Sedation

Poor functioning

Reduced adherence to treatment

5

ADA/APA Consensus Statement on Antipsychotic Drugs and Obesity and Diabetes

––+/-ziprasidone*

––+/-aripiprazole*

DD+ +quetiapine

DD+ +risperidone

+++ + +olanzapine

+++ + +clozapine

DyslipidemiaDiabetes RiskWeight GainDrug

+ = increased effect; - = no effect; D = discrepant results. *Newer drugs with limited long-term data.Diabetes Care/J Clin Psych, 2004 and others

6

Olanzapine (n=330) Risperidone (n=333)

Ziprasidone (n=183)Quetiapine (n=329)Perphenazine (n=257)

0.8

0.9

0.7

0.6

0.4

0.3

0.1

0.5

0.2

0.00 3 6 9 12 15 18

1.0

Time to Discontinuation for Any Cause (months)

Prop

ortio

n of

Pat

ient

sC

ontin

uing

Tre

atm

ent

CATIE Schizophrenia Study: Time to Discontinuation for Any Cause

Lieberman JA et al. N Engl J Med. 2005;353:1209-1223.

7

Psychiatrists Perceive the Greatest Unmet Needs in the Treatment of Schizophrenia and Bipolar Disorder to Involve Better/More Consistent Efficacy Balanced with Tolerable Side Effects

Less expensive medications (issue for 10-20% of patients)

Less expensive medications (issue for 30% of patients) Lower Cost

QD medicationsSimple regimen, maybe a combination of meds patients typically take in a single capsule

Simpler Administration

Fewer metabolic effectsLimited side effects

Better performance in terms of metabolic effects and weight gain (effects impact compliance)

Fewer Side Effects

More uniformly effective for depressed phaseDrugs that work alone to treat all stagesControl of agitation

Uniform effectiveness (balanced with side effect burden)Treatment of positive symptoms -violence, loss of self-controlSomething to enhance cognitive functioning of patients, improve intellectual capacityNew alternatives – “There are still a number of patients who are quite sick with available medications. We need new mechanisms, an increased arsenal.”

Better Efficacy

Bipolar DisorderSchizophreniaUnmet Needs

DSP, data on file, 2009

8

Receptor Binding Profiles:Lurasidone and Other Agents

26

>1000

67

38

10

2.1

34

3.3

Aripip

7

4.9

2.0

16

18

120

9.2

110

Cloz

7

210

9.0

350

310

320

340

200

Quet

2

>1000

510

400

6.0

8.5

0.3

3

Zip

19248α1Orthostatic hypotension, sedation

2101111α2cCognition

1106.60.505-HT7Mood/Cognition

27002606.85-HT1AMood/Cognition

7.6 >1000>1000ACh M1Impair cognition

3.83.5>1000 Histamine H1Impair cognition, sedation, weightgain

5.80.22.05-HT2AAntipsychotic/ Attenuate EPS

142.91.7D2Antipsychotic

OlanzRispLurasidoneBinding Affinities(Ki; nM)

Lurasidone data on file, 2008Bymaster,et al. Neuropsycopharmacology,1996;14:87-96 and others

9

Lurasidone Dose-Dependently Competes with [3H]SB-269970 Binding

5-HT7 Receptor Autoradiographyin Rat

Lurasidone 100 nM Lurasidone 1000 nM

ThHy

AmLurasidone 1 nM Lurasidone 10 nM

Am-AmygdalaHy-HypothalamusTh-ThalamusHi-Hippocampus

Total Non Specific

Hi

10

11

Lurasidone Reverses MK-801 Induced Learning & Memory Impairment

Inescapable shock

+Lurasidone

1 day later

1 day later

1 day later

12

Lurasidone Phase 2 Studies

DSM-IV schizophrenia, requiring hospitalization

6-week, randomized, double-blind,placebo-controlled

All studies involved US sites only

Primary end point: BPRS derived from PANSS (BPRSd)

Hospitalization required for 2-4 weeks

13

Study 006:PANSS Total Score (ITT-LOCF)

†p=0.06 *p≤0.05; **p=0.01 Ogasa et al. ICOSR 2003

-20

-18

-16

-14

-12

-10

-8

-6

-4

-2

00 1 2 3 4 5 6

WeeksM

ean

Cha

nge

from

Bas

elin

e

Placebo (n=49)

†

Lurasidone 40 mg (n=49)

** **

Lurasidone 120 mg (n=47)

14

-16

-14

-12

-10

-8

-6

-4

-2

00 1 2 3 4 5 6

WeeksM

ean

Cha

nge

from

Bas

elin

e

Study 196:PANSS Total Score (ITT-LOCF)

*

* *

*

*

**

Day 3

*p≤0.01Nakamura M et al. J Clin Psych, 2009

Placebo (n=90) Lurasidone 80 mg (n=90)

15J Clin Psychatry June 2, 2009, e1-e8

16

Depressive Symptom Change: Phase 2 Data

Anxiety Depression

PANSS Anxiety/Depression

MADRS

**

n=135n=135 n=135n=135 n=181n=181n=181n=181

-1.0

-0.5

0.0

Mea

n C

hang

e fr

om B

asel

ine

Placebo

*

n=83n=83 n=86n=86

-4

-3

-2

-1

0

Mea

n C

hang

e fr

om B

asel

ine

Studies 006, 196Studies 006, 196Studies 006, 196 Study 196Study 196Study 196

Baseline: Placebo 14.5, Lurasidone 14.2LOCF at end point*p<0.05 using ANCOVA

Lurasidone80mg

17

PANSS Cognitive Subscale

Nakamura M et al. J Clin Psych, 2009

Study 196

-0.5

-2.1

-2.5

-2

-1.5

-1

-0.5

0M

ean

Cha

nge

Placebo

Lurasidone

p = 0.0015

n=90n=90

18

Simpson Angus Scale (SAS):Pooled Phase 2 Studies*

0.230.04

1.24

-0.05

0.49

0.09

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

Placebo Lurasidone20mg

Lurasidone40mg

Lurasidone80mg

Lurasidone120mg

Haloperidol10mg

Mea

n C

hang

e

n=209 n=71 n=114 n=159 n=48 n=72

*Studies 006, 049, 196SAS scored 0-5 on 10 items for max possible score of 50

19

Barnes Akathisia Rating Scale (BARS): Pooled Phase 2 Studies*

*Studies 006, 049, 196BAS scored 0-5 on Global Clinical Assessment of akathisia; maximum score= 5

0.160.31

0.58

0.12

-0.06-0.04

-0.5

0.0

0.5

1.0

1.5

2.0

Placebo Lurasidone20mg

Lurasidone40mg

Lurasidone80mg

Lurasidone120mg

Haloperidol10mg

Mea

n C

hang

e

n=210 n=71 n=114 n=160 n=48 n=72

20

Serum Prolactin:Pooled Phase 2 Studies*

-1.4

1.4

8.5

-2

0

2

4

6

8

10

Placebo Lurasidone Haloperidol

Med

ian

Cha

nge

(ng/

mL)

n=187n=187

n=62n=62n=353n=353

*Studies 006, 049, 196

21

CATIE Schizophrenia Study: Prolactin

-4.5

15.4

-9.3-6.1

0.4

-20.0

-10.0

0.0

10.0

20.0

Ziprasidone Risperidone Quetiapine

Olanzapine Perphenazine

Mea

n ch

ange

from

Bas

elin

e (n

g/dL

)

Ziprasidone Olanzapine

n=143n=143

n=262n=262

n=268n=268 n=286n=286 n=212

Lieberman JA et al. N Engl J Med 2005;353:1209-1223. 20.1 mg/dOlanzapine20.8 mg/dPerphenazine

543.4 mg/dQuetiapine3.9 mg/dRisperidone

112.8 mg/dZiprasidoneMean Modal Dose

22

Weight Gain:Pooled Phase 2 Studies*

0.16

0.46

0.100.0

0.5

1.0

1.5

2.0

Placebo Lurasidone Haloperidol

Mea

n C

hang

e (k

g)

n=208n=208 n=71n=71n=387n=387

*Studies 006, 049, 196

23

Plac

ebo

Molind

one

Zipra

sidon

eFlu

phen

azine

Halope

ridol

Risper

idone

Chlor

prom

azin

eSe

rtind

oleTh

iorida

zine

Olanza

pine

Cloza

pine

–3

–2

–1

0

1

2

3

4

5

6M

ean

Cha

nge

in B

ody

Wei

ght (

kg) Conventional Antipsychotics

Second-generation Antipsychotics

Estimated Mean Weight Gain at 10 Weeks with Antipsychotics

Allison DB et al. Am J Psychiatry. 1999;156:1686-1696

24

-30

-25

-20

-15

-10

-5

0Cholesterol HDL* LDL* Triglycerides

Mea

n C

hang

e (m

g/dL

)

Placebo Lurasidone

Lipid Profile:Pooled Phase 2 Studies#

n=192/381 n=78/76 n=72/70 n=192/381

#Studies 006, 049 and 196*Not measured in study 049 Fasting measures obtained per protocol

25

-18.1

-2.6

19.2

42.9

8.3

CATIE Schizophrenia Study:Triglycerides

Ziprasidone Risperidone Quetiapine Olanzapine Perphenazine

n=143n=143

n=262 n=268n=268 n=286n=286 n=212n=212

20.8 mg/dPerphenazine20.1 mg/dOlanzapine

543.4 mg/dQuetiapine3.9 mg/dRisperidone

112.8 mg/dZiprasidoneMean Modal Dose

Lieberman JA et al. N Engl J Med 2005;353:1209-1223

Mean Change from Baseline (mg/dL)

26

A Randomized, Double-Blind Study Comparing 3 Fixed Doses of Lurasidone to Placebo in Patients With Acute Schizophrenia: A Phase 3 Trial

A Randomized, Double-Blind Study Comparing 3 Fixed Doses of Lurasidone to Placebo in Patients With Acute Schizophrenia: A Phase 3 Trial

Study D1050229 (PEARL 1)

27

PEARL 1:Study Design

Open-Label Extension PhaseDouble-Blind Phase

6 weeks 22 months

Scre

enin

gSc

reen

ing

Scre

enin

g

Bas

elin

eB

asel

ine

Bas

elin

eLurasidone 40 mg/d

n=120Lurasidone 40 mg/dLurasidone 40 mg/d

n=120n=120

Placebon=120

PlaceboPlacebon=120n=120

Lurasidone 80 mg/dn=120

Lurasidone 80 mg/dLurasidone 80 mg/dn=120n=120

Lurasidone 120 mg/dn=120

Lurasidone 120 mg/dLurasidone 120 mg/dn=120n=120

Lurasidone 40-120 mg/dLurasidone 40Lurasidone 40--120 mg/d120 mg/d

28

Key Entry Criteria

DSM-IV schizophrenia• Acute exacerbation ≤2 months• ≤2 weeks hospitalization prior to screening• No significant improvement between screening and baseline

Age 18-75 yrs

Baseline Assessments• PANSS score ≥80; ≥4 (moderate) on at least 2 positive

psychotic items • CGI-S ≥4

Medically stable

Not treatment resistant• Based on failure to respond to ≥2 prior antipsychotic trials

29

Efficacy Endpoints

Primary endpoint• Baseline to 6-week/endpoint change in PANSS

Total Score, using mixed model repeated measures (MMRM) analysis adjusted by Hommel procedure for multiple comparisons (dose/endpoints)

• ANCOVA LOCF used for sensitivity analysis

Key secondary endpoint• CGI-S change

30

PANSS Total (MMRM)

-25

-20

-15

-10

-5

0Baseline Day 4 Wk 1 Wk 2 Wk 3 Wk 4 Wk 5

Wk 6Endpoint

Placebo (n=124) 40 mg Lurasidone (n=118) 80 mg Lurasidone (n=123) 120 mg Lurasidone (n=121)

LS M

ean

Cha

nge

from

Bas

elin

e

*0.031

*0.018

*0.017 *

0.010 *0.011

*

*

31

PEARL 1:PANSS Total ≥30% Responder Analysis

38%

50%52%46%

0%

10%

20%

30%

40%

50%

60%

70%

Lur 40 mg/d Lur 80 mg/d Lur 120 mg/d Placebo

Perc

enta

ge o

f Sub

ject

s

n=122 n=119 n=124 n=124

*p=0.058

†P=0.028

32

-30

-25

-20

-15

-10

-5

0

PANSS Total:Per Protocol Population

LS M

ean

Cha

nge

(LO

CF)

n=19 n=26 n=13 n=29

n=100 n=89 n=94 n=102

* *p=0.004

Lur 40 mg Lur 80 mg PlaceboLur 120 mg

p=0.032

33

PANSS Positive Subscale (MMRM)

-10

-5

0Baseline Day 4 Wk 1 Wk 2 Wk 3 Wk 4 Wk 5

Wk 6Endpoint

Placebo (n=124) 40 mg Lurasidone (n=118) 80 mg Lurasidone (n=123) 120 mg Lurasidone (n=121)

LS M

ean

Cha

nge

from

Bas

elin

e

*

* **

* *** **

* *** **

* **

* *** **

* *** ** *

* ** *

*p<0.05**p<0.01***p<0.001

34

CGI-S (MMRM)

-1.5

-1.2

-0.9

-0.6

-0.3

0.0Baseline Day 4 Wk 1 Wk 2 Wk 3 Wk 4 Wk 5

Wk 6Endpoint

Placebo (n=124) 40 mg Lurasidone (n=122) 80 mg Lurasidone (n=119) 120 mg Lurasidone (n=124)

*0.025

*0.029

*0.009 *

0.006*

0.005

* 0.048

* 0.029

LS M

ean

Cha

nge

from

Bas

elin

e

35

0.3

0.00.0

0.5

1.0

1.5

Lurasidone Placebo

PEARL 1:Weight Change (LOCF)

Med

ian

Cha

nge

from

Bas

elin

e (k

g)

(N=124)

n=364

36SAS scored 0-5 on 9 items for max possible score of 45

PEARL 1:Simpson Angus Scale (SAS)

-0.01

0.06

0.010.03

-0.05

0.00

0.05

0.10

0.15

0.20

Lur 40 mg/d Lur 80 mg/d Lur 120 mg/d Placebo

LS M

ean

Cha

nge

n=122 n=119 n=124

n=124

37

PEARL 1: Barnes Akathisia Rating Scale (BAS)

BAS scored 0-5 on Global Clinical Assessment of akathisia for a maximum possible score of 5

0.0

0.3

0.10.1

0.0

0.5

1.0

Lur 40 mg/d Lur 80 mg/d Lur 120 mg/d Placebo

LS M

ean

Cha

nge

n=124 n=122 n=119 n=124

Global Clinical Assessment

38

0.70

0.35

0.0

0.5

1.0

1.5

2.0

2.5

3.0

Lurasidone Placebo

Med

ian

Cha

nge

(ng/

mL)

PEARL 1:Serum Prolactin

n=361n=361 n=122n=122

39

-14

-12

-10

-8

-6

-4

-2

0Cholesterol HDL LDL Triglycerides

Med

ian

Cha

nge

(mg/

dL)

Placebo Lurasidone

PEARL 1:Lipid Profile

n=108/343 n=108/343 n=108/343 n=108/343

LOCF endpoint values; fasting per protocol; includes all subjects

40

2.11.91.2 1.8

0.0

2.0

4.0

6.0

8.0

10.0

Lur 40 mg/d Lur 80 mg/d Lur 120 mg/d Placebo

PEARL 1:QTcF Interval Change (LOCF)

Mea

n C

hang

e (m

sec)

n=120n=120n=122n=122n=117n=117n=120n=120

41

6.2%

6.5%

4.7%

4.1%

11.2%

10.8%

8.7%

11.2%

12.8%

12.8%

10.6%

14.9%

11.6%

6.5%

13.3%

21.4%

Sedation

Nausea

Somnolence

Akathisia

Placebo (n=339)Lurasidone 40 mg (n=241)Lurasidone 80 mg (n=282)Lurasidone 120 mg (n=173)

Treatment-Emergent Adverse Event Rates (Incidence ≥10%)

Phase 2 and 3 DataStudies 006/049/196/PEARL 1

Cucchiaro J, et al. Efficacy and Safety of Lurasidone in Phase 2/3 Acute Schizophrenia Trials. Poster.American Psychiatric Association, San Francisco, CA, May 16-21, 2009,

42

Lurasidone Efficacy:Summary

Consistent efficacy

40, 80 and 120 mg/d shown effective across 3 placebo-controlled trials

Rapid onset (day 3 or 4) with subsequent sustained improvement noted in placebo-controlled trials

Potential for improvement of cognitive deficits, based on preclinical and clinical data

43

Lurasidone Safety:Summary

Lurasidone is well tolerated

Low rates of EPS and akathisia

Minimal prolactin change

Neutral effects on weight, lipids and glucose

Modest change in QTc interval

Self-reported AEs are generally mild and transient

Potential for Ongoing Adherence to TreatmentPotential for Ongoing Adherence to TreatmentPotential for Ongoing Adherence to Treatment

44

Lurasidone Development ProgramLurasidone Development Program

45

PEARL 1 and 2 Trials:Lurasidone in Acute Schizophrenia

Lurasidone 40 mgLurasidone 40 mgLurasidone 40 mg

Lurasidone 80 mgLurasidone 80 mgLurasidone 80 mg

Lurasidone 120 mgLurasidone 120 mgLurasidone 120 mg

PlaceboPlaceboPlacebo

Lurasidone 40-120 mgLurasidone 40Lurasidone 40--120 mg120 mg

Open-label, 2 years

Study 229PEARL #1Study 229Study 229PEARL #1PEARL #1

Double-blind, 6 weeks

Lurasidone 40 mgLurasidone 40 mgLurasidone 40 mg

Lurasidone 120 mgLurasidone 120 mgLurasidone 120 mg

Olanzapine 15 mgOlanzapine 15 mgOlanzapine 15 mg

PlaceboPlaceboPlacebo

Lurasidone 40-120 mgLurasidone 40Lurasidone 40--120 mg120 mg

Open-label, 6 months

Study 231PEARL #2Study 231Study 231PEARL #2PEARL #2

Double-blind, 6 weeks

N=480/studyLurasidone: QD dosing schedule

46

PEARL 3:Lurasidone in Acute Schizophrenia

Lurasidone 80 mgLurasidone 80 mgLurasidone 80 mg

Lurasidone 160 mgLurasidone 160 mgLurasidone 160 mg

Quetiapine XR 600 mgQuetiapine XR 600 mgQuetiapine XR 600 mg

PlaceboPlaceboPlacebo

Lurasidone 40-160 mgLurasidone 40Lurasidone 40--160 mg160 mg

Quetiapine XR 200-800 mgQuetiapine XR 200Quetiapine XR 200--800 mg800 mg

Double-blind, flexible dose, 1 year

Studies 233/234

PEARL #3

Studies Studies 233/234233/234

PEARL #3PEARL #3

Double-blind, 6 weeks

N=480/studyLurasidone: QD dosing schedule

47

Open-Label Continuation PhaseDouble-Blind Phase

12 months 6 months

Scre

enin

gSc

reen

ing

Scre

enin

g

Bas

elin

eB

asel

ine

Bas

elin

e

Lurasidone 40-120mg/dN=400(200 for sub-study)Lurasidone 40Lurasidone 40--120mg/d120mg/d

N=N=440000(200 for sub(200 for sub--study)study)

Risperidone 2-6mg/dN=200(100 for sub-study)

Risperidone 2Risperidone 2--6mg/d6mg/dN=N=220000(100 for sub(100 for sub--study)study)

Lurasidone 40-120mg/dLurasidone Lurasidone 4040--120mg/d120mg/d

Long-Term Safety Study With Cognitive Sub-Study

6 MonthsMCCB UPSA-B

Cognition Sub-Study

MCCB: MATRICS Consensus Cognitive BatteryUPSA-B: UCSD Performance-Based Skills Assessment - Brief Version

48

Atypical Use Has and Will Continue to Expand

AcuteManiaAcuteMania MaintenanceMaintenance

Treatment-Resistant

Depression

Treatment-Resistant

DepressionDepression/

AnxietyDepression/

AnxietyBipolar

DepressionBipolar

Depression

DepressionSchizophrenia Bipolar

AtypicalsAtypicals

AntidepressantsAntidepressants

Mood StabilizersMood Stabilizers

49

PREVAIL: Lurasidone in Bipolar Depression

50

PREVAIL Add-On Design (Study 235) PREVAIL Monotherapy Design (Study 236)

PREVAIL Extension

Study

PREVAIL PREVAIL Extension Extension

StudyStudyPlacebo + Lithium or Valproate

Placebo Placebo + Lithium or + Lithium or ValproateValproate

Lurasidone 20-120 mg/d+ Lithium or Valproate

Lurasidone 20Lurasidone 20--120 mg/d120 mg/d+ Lithium or + Lithium or ValproateValproate

ScreeningScreeningScreening

Bas

elin

eB

asel

ine

Bas

elin

e3-28 days

Day 0

Double-Blind Phase

6 weeksEnrollment Initiated 2Q ’09Enrollment Initiated 2Q ’09

PREVAIL Extension

Study

PREVAIL PREVAIL Extension Extension

StudyStudyPlacebo Placebo Placebo

ScreeningScreeningScreening

Lurasidone 20-60 mg/dLurasidone 20Lurasidone 20--60 mg/d60 mg/d

3-28 days

Day 0

Lurasidone 80-120 mg/dLurasidone 80Lurasidone 80--120 mg/d120 mg/d

n=504

（Study 235）

（Study 236）

Total n=504 (n=168/arm).

Total n=340 (n=170/arm).

Bas

elin

eB

asel

ine

Bas

elin

e

51

Lurasidone Commercial OverviewLurasidone Commercial Overview

Joseph Yen LinVice President, MarketingDainippon Sumitomo Pharma America

52

Agenda

I. Market and Disease State Overview

II. Competitive Landscape

53

$0

$2

$4

$6

$8

$10

$12

$14

Market OverviewOverall Growth

Sale

s ($

Bill

ions

)

Source: IMS NSP Data, 2004-2008

The atypical antipsychotic market is large and continues to grow at a robust rate

$14.1B

$12.7B

$11.3B$10.1B

$9.3B

+8.6%

+11.9%

+12.4%

+11.0%

2004 2005 2006 2007 2008

54

$2.9 $3.6 $3.2 $3.4 $3.8

$0.6$0.4 $0.6 $0.6

$0.6$1.4$1.3 $1.3 $1.5 $1.3

$2.1$2.2 $2.8 $2.8

$3.3$2.3

$2.6$3.4

$4.4$5.0

$0

$2

$4

$6

$8

$10

$12

$14

Market OverviewGrowth by Diagnosis

Sale

s ($

Bill

ions

)$14.1B

$12.7B

$11.3B

$10.1B$9.3B

Source: Estimated from IMS NSP Data, 2004-2008 and NDTI 2004 to 2008

Growth in the atypical antipsychotic category is being driven by use in bipolar disorder and schizophrenia

2004 2005 2006 2007 2008

Bipolar Disorder

Schizophrenia

Depression

Anxiety

Other

55

Schizophrenia Disease State OverviewPatient Flow

U.S. lifetime prevalence of schizophrenia is 1%; approximately 2.5 million affected

Origination

Diagnosis/ Evaluation

Treatment

Continuation High rates of patient discontinuation and switching • Lack of efficacy• Side effects• Need for new treatment options

High rates of diagnosis (80%) and treatment (85%)

Atypical antipsychotics considered the gold standard for schizophrenia

56

Schizophrenia Disease State OverviewLandmark CATIE Trial

“…patients with chronic schizophrenia in this study discontinued their antipsychotic study medications at a high rate, indicating

substantial limitations in the effectiveness of the drugs.”

Effectiveness of Antipsychotic Drugs in Patients with Chronic Schizophrenia

Jeffrey A. Lieberman, M.D., T. Scott Stroup, M.D., M.P.H., Joseph P. McEvoy, M.D., Marvin S. Swartz, M.D., Robert A. Rosenheck, M.D., Diana O. Perkins, M.D., M.P.H., Richard S.E. Keefe,

Ph.D., Sonia M. Davis, Dr.P.H., Clarence E. Davis, Ph.D., Barry D. Lebowitz, Ph.D., Joanne Severe, M.S., John K. Hsiao, M.D., for the Clinical Antipsychotic Trials of Intervention Effectiveness (CATIE)

Investigators

57

Bipolar Disease State OverviewPatient Flow

U.S. lifetime prevalence of bipolar disorder is 2.6%; over 6 million affected

Origination

Diagnosis/ Evaluation

Treatment

Continuation

Relatively lower rates of diagnosis (45%) and treatment (80%) as compared to schizophrenia

Multiple agents currently used in treatment – lithium, antiepileptic agents

Atypicals increasingly used to treat bipolar depression

Only 1 atypical currently approved for bipolar depression (Seroquel)

58

Key Takeaways

Large, growing market for atypical antipsychotics

High rate of dissatisfaction and switch; need for new treatment options

Increasing use for the treatment of bipolar disorder is a significant driver of atypical antipsychotic market growth

ChallengesOpportunities

59

Agenda

I. Market and Disease State Overview

II. Competitive Landscape

60

0%

5%

10%

15%

20%

25%

30%

35%

40%

Jan-0

3Ju

l-03

Jan-0

4Ju

l-04

Jan-0

5Ju

l-05

Jan-0

6Ju

l-06

Jan-0

7Ju

l-07

Jan-0

8Ju

l-08

Atypical Antipsychotic MarketCurrent Competitive Environment

SEROQUEL

RISPERIDONE

ABILIFY

ZYPREXA

GEODONCLOZARILINVEGARIS CONSTA

Seroquel is the clear market leader; impact of generic risperidone not yet evident

Source: IMS DataView

TRx

Shar

e

61

Atypical Antipsychotic MarketPerceptual Mapping in Schizophrenia

Safe

ty/T

oler

abili

ty

Efficacy

Better-Tolerated Medications (i.e.

limited weight gain, metabolic issues);Less Efficacious

More Efficacious Medications; Less Well-tolerated (i.e.

weight gain, metabolic issues, EPS)

Cognitive Functioning

New product opportunity

62

APS Market Evolution:New Competitors, Generic Entries

2009 2010 2012 2013 20142011

Fanapt(iloperidone)

Saphris(asenapine)

Serdolect(sertindole)

New

Com

petit

ors

Up to 3 new competitors within the next 12 months

Generic Olanzapine

Generic Quetiapine

Generic Ziprasidone

Generic Paliperidone

Gen

eric

Ent

ries

Large brands turning generic 2011-2013

63

Antipsychotic Payer Mix

Dual Eligibles7%

Medicaid23%

Medicare Part D17%

CommercialManaged Care

39%

Public and private payers likely to increase control over utilization of branded products when more generics become available

Source: IMS

Other14%

Manage access through tiered co-payments

(higher co-pay for more restricted medications)

Manage access through preferred drug lists (PDLs);

manufacturers provide supplemental rebates to

gain access to PDL

64

Key Takeaways

Highly competitive market with large brands

New competitor launches pending

Genericization of market beginning in 2011 will change market dynamics payers more likely to control utilization of branded products

Large, growing market for atypical antipsychotics

High rate of dissatisfaction and switch; need for new treatment options

Increasing use for the treatment of bipolar disorder is a significant driver of atypical antipsychotic market growth

Market opportunity for more efficacious, better tolerated medications

ChallengesOpportunities

65

Disclaimer Regarding Forward-looking Statements

The statements made in this presentation material are forward-looking statements based on management’s assumptions and beliefs in light of information available up to the day of announcement, and involve both known and unknown risks and uncertainties.

Actual financial results may differ materially from those presented in this document, being dependent on a number of factors.

Information concerning pharmaceuticals (including compounds under development) contained within this material is not intended as advertising or medical advice.