Maximizing Corporate Value In The Life Sciences IndustryMaximizing Corporate Value In The Life Sciences Industry

Apeiron Partners LLC161 Worcester RoadSuite 301Framingham, MA 01701Tel. 781.250.2100 Fax.781.250.2101www.apeironpartners.com

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Apeiron SummaryApeiron Summary

Boutique investment bank focused exclusively on the life sciencesFounded in 1995U.S. NASD/SIPC member firmFocus areas:

• Design and execution of corporate spin-outs:- on behalf of parent companies - a differentiating focus

• Mergers & acquisitions:- primarily between U.S. and European firms leveraging market disparities

• Private placements:- very selectively where we can help shape corporate and financial strategy in the process

• Strategic alliances:- “high-end” alliances where deep structuring and negotiation skills are required

• Investment advisory practice:- Advising Zambon Group (Milan, Italy) on the investment of €60 million

• Deals originated and closed in all three major markets: - North America, Europe and Japan

Current staff of seven professionals

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Apeiron Partners LLC: Track RecordApeiron Partners LLC: Track Record

>$550 million in capital (not “biodollars”) raised to date by Apeiron principals in N. America, EU & Japan

Successfully designed, implemented and financed several private placements and four spin-outs

Clients include both large and development-stage bio-pharma firms in N. America, EU & Japan

Global network of VC relationships: North America, Europe and Asia

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To maximize the value of our clients by developing and implementing integrated

transactional solutions

To maximize the value of our clients by developing and implementing integrated

transactional solutions

Apeiron MissionApeiron Mission

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Traditional Consulting Firms

Apeiron Partners LLC

Traditional Investment

Banks

Strategy Oriented

Transaction-Oriented

Apeiron Addresses a Key Unmet Need Within the Life Sciences Industry

Apeiron Addresses a Key Unmet Need Within the Life Sciences Industry

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Our Transaction PhilosophyOur Transaction Philosophy

The speed, scope and geographic dimensions of life science innovation is unprecedentedIn response, many companies are looking “outside” for various “innovation solutions”Research shows that many of these undertakings have failedA new model of innovation management is needed which balances internal “core” focus with transactional opportunities from outside the companyThe needed innovation management model is one that transacts, integrates and manages “to the core”

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The New Model for Innovation ManagementThe New Model for Innovation Management

CoreInnovationsCorporate

VentureCapital

IPOut-licensingIn-licensing

Innovation by AllianceJVs/ConsortiaOpen Alliances

Integral Alliances

Innovation byAcquisitionR&D M&A

Later-Stage Deals

‘Spinnovation’Spinouts

CorporateVenturing

New Tech/BizDevelopment

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Apeiron Committed to Leadership in This Emerging Discipline

Apeiron Committed to Leadership in This Emerging Discipline

First Edition Published in 2005 by:

Financial Times/Pearson Publications

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ProfiGen Inc.

Some Apeiron Clients and PartnersSome Apeiron Clients and Partners

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Sample Apeiron Partners’ Spin-out ActivitiesSample Apeiron Partners’ Spin-out Activities

RJR – Targacept (2000): •Apeiron designed, executed and helped grow this CNS-oriented drug discovery and development firm which has raised over $130 million since 2000

Booz Allen – QED Solutions, Inc. (2000):

•Apeiron helped design and create this drug safety knowledge management company

KBI BioPharma, Inc.(2001):•Apeiron designed and created this bioproduction spin-out of Kinetic BioSystems, Inc. to focus on the global shortfall in biomfgcapacity

British Technology Group –Ketocytonyx (2002)

•Apeiron helped BTG design and obtain financing for this CNS-oriented spin-out of BTG

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The Apeiron AdvantageThe Apeiron Advantage

Global Network of Bio-/Pharma Relationships:

• Transactions completed in all three major markets of U.S., Europe and Japan

• Regularly calling upon CEOs/senior management of 20-40 pharma firms per month

• Current clients include firms from U.S., Europe and Japan

Global Network of Venture Capital Relationships:

• Have raised capital in all three markets of U.S., Europe and Japan

• Regularly calling upon 30-50 VCs per month• Frequent speaker on corporate spin-outs and

innovation management

Exploiting Key Trends in the Life Science Markets:

• Corporate spin-outs increasing as firms seek to rationalize and leverage their portfolios in the face of rising R&D costs and pricing pressures

• Consolidation in the industry inevitable and will be severe as too little capital available to fully develop all technologies and products

• Flux of public capital flowing into life science markets without clear plan for commercialization

Apeiron creatively leverages the above for the benefit of our clients

Apeiron creatively leverages the above for the benefit of our clients

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Apeiron’s Investment Advisory PracticeApeiron’s Investment Advisory Practice

Principals have 30+ work-years experience in life science venture capitalExperience covers VC investment, fundraising, senior management recruitment, board experience and portfolio managementApeiron’s formal investment advisory practice began in 2003 with a mandate from Z-Cube s.r.l.:

• VC subsidiary of the Zambon Group, a privately-held multinational pharma company with annual revenues >€500 million

• €60 million being invested in the formation and growth of companies in Zambon strategic focus areas

• Over 800 projects and companies screened since 2003• Deep due diligence performed on >10, investments made in 3 thus far,

4-5 additional investments in the next 12 months

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Management of Apeiron Partners LLCManagement of Apeiron Partners LLC

Jeffrey D. Wager, M.D., M.B.A., Managing Director

M.D., Rush Medical CollegeMBA, University of Chicago2000-present: Managing Director, Apeiron Partners LLC 1995-2000: Senior Associate and later General Partner, Medical Science Partners(Harvard-affiliated venture capital fund)Managing Director, Commonwealth PharmaPartners LLC1991-1995: Executive Director, Business Development, pharmaceutical consulting practice of Bank of Tokyo-Mitsubishi affiliate

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Management of Apeiron Partners LLCManagement of Apeiron Partners LLC

Gustav Christensen Managing Director

MBA, Harvard Business School MSc, University of Århus, Denmark 2005-present: Managing Director Apeiron Partners 2000 – 2004: Phylos, CEO1999 – 2001: GTC Chairman of Primedica1992 – 2000: PhyteraCo-Founder, Director 1991 – 1998: Alpha Beta Technology Chairman1988 – 1990: Immulogic Pharmaceutical, CEO1983 – 1988: Genetics InstituteSVP of Commercial Affairs1976 – 1983: Baxter TravenolLaboratories, VP Operations, FenwalLabs, Director of Marketing International, General Manager Sweden

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Management of Apeiron Partners LLCManagement of Apeiron Partners LLC

Christopher U. Missling, PhD, MBA Managing Director

MBA, Northwestern University, Kellogg Graduate School of ManagementPhD in Bioorganometallic Chemistry (magna cum laude), Ludwig-Maximilians-University (Munich, Germany)2005-present: Managing Director, Apeiron Partners LLC2004 – 2005: ImmunoGen, Inc. (NASDAQ: IMGN): Vice President and Chief Financial Officer2002 – 2004: Curis, Inc. (NASDAQ: CRIS): Senior Vice President Strategic Planning and Chief Financial Officer1997 – 2001: Hoechst AG / Aventis: Head of Financial Planning 1994 – 1997: Deutsche Bank, corporate finance and investment banking

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Management of Apeiron Partners LLCManagement of Apeiron Partners LLC

Richard BabbChief Financial Officer

Certified Public AccountantNASD registered broker-dealer (Series 7, 24, 28 & 63)2001 - present: Chief Financial & Compliance OfficerApeiron Partners LLC1999 - present: Chief Financial OfficerMedical Science Partners(Harvard-affiliated venture capital fund)1988 - 1999: Ernst & Youngprivate entrepreneur

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Principals of Apeiron Partners LLCPrincipals of Apeiron Partners LLC

Steven Wardell, MBA Principal

MBA, Harvard Business SchoolMPhil, Cambridge University, FinanceBA, Harvard University, EconomicsNASD registered broker-dealer (Series 7, 24 & 63) 2001-present:

• Principal, Apeiron Partners LLC• Principal, Commonwealth Pharma Securities LLC

2000-2001: Senior Manager, Sonexis(corporate development)1996-1998: Financial Analyst, Salomon Smith Barney (M&A)New England director of the Biotechnology RoundtableMember of the Board of Associates of the Whitehead Institute for Biomedical Research

Fred Meyer, PhD, CFAPrincipal

PhD, Ohio State University, Molecular GeneticsBSc, University of Illinois, Genetics and Development with DistinctionChartered Financial AnalystNASD registered broker-dealer (Series 7, 24 & 63)2002-present:

•Principal, Apeiron Partners LLC•Principal, Commonwealth Pharma Securities LLC

2000-2001: Research Associate, Needham, Biotechnology Equity Research1997-2000: Research Analyst, Schooner CapitalMember of the Board of Associates of the Whitehead Institute for Biomedical Research

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Sample Apeiron Engagement ProfilesSample Apeiron Engagement Profiles

Enabled company to achieve break-even in revenues

$7 millionSeed and follow-on venture capital financingU.S.Drug informatics firm

Avoided insolvency for client firm; first major strategic

alliance for client

>$15 millionResearch and development collaboration multinational Japanese company

U.S.Development-stage molecular biology firm

Enabled client to secure CEO and state funding to acquire

mfg plant

Not disclosedVenture capital financing and spin-out of biomanufacturing subsidiary from bioremediation

parent and venture capital financing.

U.S.Development-stage bio-manufacturing firm

significant value creation and acceleration of the client’s

time-to-IPO

>$75 millionResearch, development, and commercialization agreement with U.S. multinational firm

U.S.Combinatorial chemistry-biology

significant value creation and acceleration of the client’s

time-to-IPO

Not disclosedResearch, development, and commercialization agreement with U.S. multinational firm

U.S.Combinatorial chemistry-biology

Enabled company to retain rights to marketed product

$7.5 millionVenture capital financing and partial sale of royalty interests

U.S.Oncology focused,, development-stage

Enabled client to bring lead product to market with only ~$10 million VC financing

>$50 millionResearch, development, and commercialization strategic alliance with a European multinational

pharma company

U.S.Oncology focused,, development-stage

CommentsDeal ValueDescription of TransactionClient Location

Client Description

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Sample Apeiron Engagement Profiles - 2Sample Apeiron Engagement Profiles - 2

Transaction suspended further to discontinuation of

parent program

NADesigned and negotiated comprehensive co-development alliance with major Japanese firm

U.S.Multinational pharma company

Implementation of spin-out suspended due to M & A of

parent

NADesigned spin-out for this firm resulting in significant investor interest

U.S.Multinational pharma company

Second strategic alliance for client

Not disclosedResearch, development, and commercialization agreement with European multinational firm

U.S.DNA therapeutics company

First strategic alliance for client

Not disclosedResearch, development, and commercialization agreement with European multinational firm

U.S.DNA therapeutics company

significant value creation and acceleration of the client’s

time-to-IPO

Not disclosedResearch, development, and commercialization strategic alliance with a multinational European

pharma company

U.S.CNS-oriented drug discovery & development

firm

Enabled company to significantly develop pipeline

and secure additional partnerships

$30 millionDesign and completion of spin-out and venture capital financing of company

U.S.CNS-oriented drug discovery & development

firm

Enabled client to secure VC interest for spin-out financing

>$80 millionResearch, development, and commercialization strategic alliance with a multinational European

pharma company

U.S.CNS-oriented drug discovery & development

firm

CommentsDeal ValueDescription of TransactionClient Location

Client Description

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Sample Apeiron Engagement Profiles - 3Sample Apeiron Engagement Profiles - 3

Formed basis for company to initiate and pursue corporate

partnering campaign

NADesign comprehensive corporate partnering strategy

CanadaPrivately-held, venture-backed oncology firm

significant value creation and acceleration of the client’s time-to-deal closure on its

M & A

Not disclosedValuation of company’s lead product for purposes of negotiating M & A of firm

EuropePrivately-held, venture-backed, CNS-oriented

drug discovery & development firm

Enabled client to secure VC interest for spin-out financing

Not disclosedDesign and completion of spin-out and venture capital financing of company

EuropeMultinational, publicly held technology company

Spin-out suspended pursuant to strategic shift of pharma

company

Not disclosedDesign and completion of term sheet with investors for spin-out and venture capital financing of

company

EuropeMultinational pharma firm

Engagement terminated pursuant to acquisition

NADesign and implementation of comprehensive corporate partnering strategy

U.S.Privately-held, venture-backed oral care firm

Following completion NADesign of marketing program for private equity program in Japan

U.S.Large U.S. private equity firm

Implementation of spin-out suspended due to acquisition

of partent

NADesigned spin-out for this firm resulting in significant investor interest

U.S.Publicly-held medical device company

CommentsDeal ValueDescription of TransactionClient Location

Client Description

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Why Apeiron For The Spin-Out Process?Why Apeiron For The Spin-Out Process?

Only firm dedicated to the design and execution of corporate spin-outs in the life science spaceRepresenting parents – not investors – in the spin-out processProven ability to organize and optimize a quality syndicate of value-added investors and partners Providing a fully outsourced solution to the spin-out strategy and implementation process in order to conserve and focus parent resources

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Scope of Spin-Out Services Provided by Apeiron PartnersScope of Spin-Out Services Provided by Apeiron Partners

Development and differentiation of NewCo corporate identity and missionDesign and implementation of organizational strategy (relationship with parent, inter-company agreements, etc.)Design and implementation of R&D and corporate development strategiesStrategy and recruitment of board and advisory board membersStrategy and selection of accounting and legal representationDevelopment of public relations & publication strategiesDevelopment and implementation of strategic alliance strategyDesign and implementation of venture capital strategyDrafting of all business plans, financial plans, presentational material, etc.“Front-line” role in implementation of all spin-out business processes

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SummarySummary

Strong blend of scientific, strategic and deal execution skills in all three major life science markets

Commitment to maximizing corporate value through an integrative innovation management discipline in all transaction work

Strong track record of success