Nick Manov, CEO

1
Gate 1 Presentation
October 13, 2007

• Nick Manov, CEO
• Miguel Hengelhaupt, CFO
• Rachel Dyke, CMO
• Adam Silverman, PhD, CTO

2
The NARM-X Vision

• NARM-Xs novel technology for lead discovery of
  protein therapeutic agents will screen drug
  candidates faster and will generate more
  candidates than mainstream technologies in the
  13 billion protein-based oncology therapeutics
  market.

3
The Need

• Pharmaceutical companies need faster, cheaper
  ways to discover drug candidates (esp.
  protein-based)
• Discovery process takes 2-20 years and gt200
  million per drug1,2

Lead discovery
Development
Pre-clinical
Clinical
Approval
5-10 years
2-20 years
3-6 years

• Wikipedia. Drug Development, 2007.
  http//en.wikipedia.org/wiki/Drug_development
• PubMed, NCBI DiMasi et al, Tufts Center for Drug
  Development.

4
The Opportunity

• Focus on oncology
• Our opportunity is large pharmas partnering in
  early-stage RD

Who discoveredGenentechs drugs?
43
57
Pharma Projects Company Analysis, Genentech,
2007.
5
The Business
The Technology

• High-volume compound screening process

• Use novel technology to discover new compounds
• License lead compounds to large pharmaceuticals
  for testing

6
Industry Contacts

• Ashraf Hanna, VP Alliance Mgmt, Genentech
• Spencer Tall, Managing Director, Allegis Capital
• Linda Ara, CEO, Ara Enterprises
• Initial Contact
• Dr. Larry Lasky, Former CSO, Genetech
• Dr. Vera Kallmeyer, Founder, Equity4Health
• Dr. Patrick Maguire, CEO, CyberHeart
• Further Referrals
• Guy Nohra, Co-founder, Altos Ventures
• Sharon Lake, Medical Device Consultant, In-Cube
• Rod Young, Chairman, CyberHeart
• Carolyn Feamster, VP Business Strategy, Alza

7
OPPORTUNITY Drug Development Market

• Productivity Concerns
• Large biotech and pharma are looking to fill a
  noticable gap in their pipelines.
• Biotech and big pharma RD increased 15.7 from
  2005 to 2006.
• Partnering

8
Protein Therapeutics Market

• Key Players in the Market
• Genentech
• Hoffman-La Roche
• Centocor
• Abbott
• MedImmune
• Schering-Plough
• ImClone
• Lilly
• Merck KGaA
• Genzyme
• Novartis
• CAT
• Biogen Idec
• Wyeth
• Biogen Idec/Elan
• Johnson and Johnson
• Corixa

• Big Pharma
• Wants In
• In-licensing
• Acquisitions

9
Total Available/Served Market
TAM2
Protein Thera- peutics 40 (est)
AIID1 39
RD on lead discovery 33 (est)
Total RD Spending (60B)
TAM 3.4b
Oncology1 43
TAM2 TAM1 3.1b
TSM 42 TAM 1.4 billion
1. Business Insights, 2006.
10
Cancer Receptor Binding
11
Target Receptor
Initial library
Wash unbound, separate bound
Amplify, Incorporate new mutations
Next generation library
12
Technology Improvements
Ribosome Display (NARM-X)
Phage Display (standard)
13
Comparison of Protein Engineering Platforms
NARM-X
DAYS
Phage Display
Ribosome Display
Site-directed mutagenesis
Screening Time
Yeast Display
in vitro transcription
WEEKS
of compounds per screen (log scale)
14
Development for a Target (eg, VEGF-R)
License compounds
Affinity maturation
Library screening
Small animal models
Identify targets
in vitro data
Year 0
Year 1
Year 2
Year 3
Year 4
Year 5
Libraries with 1014 proteins each
100 High- affinity proteins
10 proteins with good in vitro/in vivo properties
15
Intellectual Property

• Patent on ribosome display owned by CAT
• Options
• Circumvent claims by altering/improving
  technology
• License technology from CAT
• NARM-X will patent any enhanced technology and
  lead compounds

16
Companies in Ribosome Display Technology
Source Goldman Sachs, GEN Biotechnology Database
Cambridge Antibody Technology (CAT)
Based on published license agreements with CAT
17
Competitors in Ribosome Display Technology
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BUSINESS MODEL
NARM-X BIOTECH
Ribosomal Display
Drug
Partnerships
Drug
Licensing
Drug Companies
Drug
Drug Candidates
Upfront Payment
Milestone Payments
Royalties
19
Forging Partnerships
Recent Partnerships and Acquisitions in Protein
Therapeutics Market 2005-7

• Key Players
• Genentech
• Hoffman-La Roche
• Centocor
• Abbott
• MedImmune
• Schering-Plough
• ImClone
• Lilly
• Merck KGaA
• Genzyme
• Novartis
• CAT
• Biogen Idec
• Wyeth
• Biogen Idec/Elan
• Johnson and Johnson
• Corixa

2005
Xencor, Roche
Genentech, Centocor
Schering-Plough, Centocor
Seattle Genetics, PSMA Development, PDC
Peregrine Pharmaceuticals, Medarex
Roche, GlycArt Biotechnology
MedImmune, Cellective Therapeutics
Pfizer, Bioren
Xencor, Centocor
Serono, Genmab
MedImmune, Glaxo-Smith-Kline
MedImmune, Xencor
Takeda, Merck KGaA
Amgen, Abgenix
Novartis, Chiron
Agensys, MercK Co.
Crucell, DSM, IQ Corporation
Cardinal Health, Centocor
BioWa, OncoTherapy Science
Crucell, Genzyme
Cerimon Pharmaceuticals, Novartis Pharma
2006
Crucell, Millennium
BioWa, Aphton
AstraZeneca, CAT
Argos Therapeutics, Novo Nordisk
Novartis, Neutech
Seattle Genetics, Laureate Pharma
Xoma, Schering Plough
Bristol Myers, Adnexus
MercKCo, Sirna Therapeutics
2007
20
Value Chain
Customers
NARM-X Biotech
Suppliers
- Scientists - Labs - Targets/Supplies - Patent
rights

• - Further development
• Resale/License

Fast discovery of drug candidates
Technology
Licensees
21
Revenue Model
22
Proxy Company Adnexus

• Similar technology, had a compound
• Founded in 2002
• Series A funding in 2005
• 30M targets contract, Feb 2007
• 430M acquisition by Bristol-Meyers Squibb

23
Summary

• Help big pharmaceuticals
• Fill pipeline
• Give them a competitive advantage
• Total available market 1.4B
• Our focus
• Early lead discovery
• Ribosomal display
• Oncology (and AIID)

24
Thank you!Questions?
25
Technical Hurdles

• Starting with naïve libraries nonspecific
  binding and ability to pull out first
  generation leads
• Obtaining all targets of interest in useable
  form (soluble, Fc-fusion, etc)
• Robustness of cell-free expression of large
  protein fragments like Fabs (if we go in that
  direction rather than ScFvs or other fragments)
• Working out technology to screen for multiple
  targets at once (may or may not be possible)

26
Detail on technology ribosome display and mRNA
display
Hanes and Pluckthun, PNAS (1997) 94, 4937
27
Detail on technology phage display
ETH protocols http//www.pharma.ethz.ch/institute
_groups/biomacromolecules/protocols/eth
28
Potential Scaffols for Drug Targets
Cystine knots and related
Antibody-derived
Peterson, et al. AAPS J. (2006) 8, E383 Levin, et
al. unpublished results
29
Achievements of Ribosome Display

• 108-fold enrichment of ScFv to hemigglutanin
  after 5 cycles
• Naïve library screened against insulin generated
  numerous picomolar binders with totally different
  frameworks
• Picomolar binders selected from a library from
  transgenic mice and screened against progesterone

Hanes and Pluckthun, PNAS (1997) 94,
4937 Knappik, et al. J. Mol. Biol. (2000) 296,
57. He, et al. J. Immunol. Methods (1999) 231,
105. Lipovsek and Pluckthun, J. Immunol. Methods
(2004) 290, 51.
30
Exit Strategy NARM-X will not pull a Rumsfeld

• Adnexus, Bristol Myers 430M
• CAT, AstroZenica 705M

31
Positioning Statement
32
References

• 1) Wikipedia. Drug Development, 2007.
  http//en.wikipedia.org/wiki/Drug_development
• 2) Boston Globe. Waltham biotech Adnexus looks
  to join IPO parade, 8/27/2007.
  http//www.boston.com/business/globe/articles/2007
  /08/27/waltham_biotech_adnexus_looks_to_join_ipo_p
  arade/

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