Enabling Drug Delivery Technologies

Improving Current Therapies and Helping New Chemical Entities Reach the Market

2

Panel Discussion

Eric Tomlinson, PhD, DSc - President and CEO, Altea Therapeutics

Riccardo Panicucci, PhD Global Head of Chemical & Pharmaceutical Profiling - Novartis

Mary Gardner - Director, Technology Assessment, Hospira, Inc. Randy Johnson, PhD - Vice President and Chief of Technology

Development, KAI Pharmaceuticals Bob Baughman, PhD, PharmD - VP Experimental Pharmacology,

MannKind Corporation

Daniel Ruppar – ModeratorIndustry Manager, North AmericaPharmaceuticals & Biotechnology, Frost & Sullivan

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Current State of BioPharma

The pharmaceutical and biotechnology industry is in a state of transition.

Reorganization, M&A, consolidation, and portfolio changes are being evaluated in order to maintain growth centers in the face of a myriad of serious challenges.

Overall, companies are looking to align with areas of growth opportunity as well as new business strategy and product development paradigms.

Biologics, biogenerics, and drug delivery technologies are some of the areas companies are seeking to provide solutions for future revenues.

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Importance of Drug Delivery

The use of drug delivery technology applications can result in a multitude of outcomes for drug products

Enabling of Lifecycle Management scenarios

Enables use of generic compounds and NCEs in new ways

Can result in new efficacy outcomes and improved drug profile

Use with new indication development can spur new revenue opportunities

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Drug Delivery Challenges

Business Model Evolution Capturing Value and Returns Differentiation Understanding True Commercial Opportunity Technology and Reformulation Hurdles Partnerships

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0

100

200

300

400

500

600

700

800

900

2002 2003 2004 2005 2006 2007 2008

Rev

enue

s ($

Mill

ions

)

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

Gro

wth

Rat

e

Revenues Growth Rate

LCM Example: Exelon Franchise Revenues (Global), 2002-2008

Exelon Patch Launch

Source: Frost & Sullivan

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Improving Current Therapies

8

Presented Data

Data Collection Methods

The study utilized Frost & Sullivan’s web-based survey capability. A structured questionnaire with the appropriate metrics was set-up in web format (GMI-MR software).Appropriate screening questions and quota controls were provided to ensure that only qualified respondents participate in the survey.

Sample Structure

Doctors 206 Primary Care Physicians 50 Endocrinologists 50 Psychiatrists 27 Rheumatologists 26 Neurologists 28 Physical Medicine/ Rehab 10 Anesthesiologist / Pain Management 15

Patients 450• Diabetes 150• Chronic Pain 150• Inflammation 150

Sample

Doctors (206) and patients (450) in the U.S. participated in this survey. The structure of the sample is shown in the table.

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Factors Impacting Patient Compliance

Efficacy, adverse side effects, ease-of-use, and patient education are perceived by doctors as the most important drivers of patient compliance.

Efficacy, adverse side effects, ease-of-use, and patient education are perceived by doctors as the most important drivers of patient compliance.

2%1% 1% 2% 2% 5% 1% 1% 4% 2%9%14% 12%

18% 15%

26%25% 22%

30%28%

45%

47%59%

52% 56%

46% 50% 54%

46% 55%

31%

38%28% 28% 27% 24% 24% 22% 20%

15% 15%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Efficacy Adverse sideeffects

Ease of Use PatientEducation

Cost Comfort Convenience PersonalResponsibility

DosingFrequency

Length of timeon medication

Not Important At All Slightly Important Moderately Important Very Important Most Important

How would you categorize the importance of the following factors on patient compliance?

MD

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Factors for Selecting Drug Delivery Type

The top 5 factors considered by a majority (over 50%) of doctors are: minimal side effects, patients’ ease of use, satisfaction, convenience, comfort.The top 5 factors considered by a majority (over 50%) of doctors are: minimal side effects, patients’ ease of use, satisfaction, convenience, comfort.

Q5. In order of importance, please select the top 5 factors that you consider when selecting a drug delivery type? (1= most important, 2=2nd most important, 3=3rd most important, etc.)  

MD

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Importance of Overall Device in Final Selection to Prescribe

The device itself is an important consideration when selecting device-driven drugs.

Only 12 percent of doctors consider it as only slightly important or not important at all.

The device itself is an important consideration when selecting device-driven drugs.

Only 12 percent of doctors consider it as only slightly important or not important at all.

For Device Driven Drug Delivery (Examples: Inhaler, Autoinjector) – How important is the overall device in your final selection to prescribe that drug product?

Not Important At All3%

Moderately Important

44%

Very Important40%

Slightly Important

9%

Most Important

4%

MD

12

20%

20%

40%

60%

0% 10% 20% 30% 40% 50% 60% 70%

Reduce frequency ofdosing

Decrease or eliminatedosing

pain/discomfort

Decrease or eliminateside effects

Delivery device

Q10c) Have you used Exubera? Q10d How satisfied are you with your overall experience using Exubera? Q10e What would you like to change about your usage experience with Exubera?

20% are satisfied with the product. Improvements in the delivery device and a decrease in side effects are most desired.

PatientExubera:Satisfaction, Desired Improvements (U.S.), Q4 2007

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Byetta: Usage, Satisfaction, Desired Improvements (U.S.), Q4 2007

Q11c Have you used Byetta? Q11d How satisfied are you with your overall experience using Byetta? Q11e What would you like to change about your usage experience with Byetta?

21% have used Byetta, including 13% who are currently using it. 53% of patients are satisfied. Lowering or elimination of side effects and reduction in frequency of dosing are the most desired improvements.

Change in Byetta Desired

24%

24%

18%

18%

29%

35%

0% 10% 20% 30% 40%

Other

None (no change needed)

Delivery device

Decrease or eliminate dosingpain/discomfort

Reduce frequency of dosing

Decrease or eliminate sideeffects

Satisfaction with Byetta

Very Dissatisfied

29%

Satisfied35%

Neutral12%

Very Satisfied

18%

Dissatisfied6%

Patient

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New Opportunities

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Attitude Towards New Delivery Forms

A majority of respondent doctors are willing to prescribe new drug delivery forms. Forty-one percent adopt new delivery forms earlier than their peers. Thirty-four percent disagree that they are very cautious about prescribing new delivery forms, while an equal proportion would agree to the same statement.

A majority of respondent doctors are willing to prescribe new drug delivery forms. Forty-one percent adopt new delivery forms earlier than their peers. Thirty-four percent disagree that they are very cautious about prescribing new delivery forms, while an equal proportion would agree to the same statement.

2% 2% 5%4%

16%

29%28%

41%

32%

61%

33%

30%

6% 9%4%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

I am generally willing to prescribe productsthat require patients to try a new drug

delivery form.

I usually adopt new drug delivery formsearlier than most of my peers.

I am generally very cautious and would rathernot prescribe drug delivery forms that are just

new in the market.

Strongly Disagree Disagree Neutral Agree Strongly Agree

Q9. To what extent would you agree or disagree with the following statements, as they apply to your own beliefs and practices?

MD

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Pulmonary Delivery – Willingness to UseDiabetes Type I

Indicate your degree of willingness to use it in the future assuming it is available, affordable, and can be prescribed by your doctor?

35%

28%

7%

24%

7%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%

Pulmonary/Inhaled

Very Willing to Use ItWilling To Use ItUnwilling but will comply if prescribed by doctorWill Definitely Not Use ItIndifferent/Don't Know

31%: Willing To Use

35%Education Gap

Patient

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From 12 different possible reason statements presented, there were 4 top categories for willing to use pulmonary delivery, the leading beingNo (or Minimal) Discomfort/Pain.

From 12 different possible reason statements presented, there were 4 top categories for willing to use pulmonary delivery, the leading beingNo (or Minimal) Discomfort/Pain.

No (or Minimal) Discomfort / Pain,

44%

Easy to self administer, 33%

Very Convenient, 11%

Rapid Onset of Drug Action, 11%

Q2h What is your Top reason for your willingness to use these types of drug delivery in the future for Diabetes Type I?

Reasons for Willingness to Use Pulmonary DeliveryDiabetes Type I

.

Patient

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Q2f. For each of the following types of drug delivery, please indicate your degree of willingness to use it in the future for <Disease Type>, assuming all these are available, affordable, and can be prescribed by your doctor

Drug Delivery Method – Willingness to UseDiabetes Type II

About 41% of Diabetes Type 2 patients are willing to use a transdermal patch in the futureAbout 41% of Diabetes Type 2 patients are willing to use a transdermal patch in the future

30% 29%

19% 26%

11%

14%

30%24%

11% 7%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Transdermal Patch Pulmonary /Inhaled

Indifferent/Don't Know Will Definitely Not Use ItUnwilling but will comply if prescribed by doctor Willing To Use ItVery Willing to Use It

Education Gap

Willing To Use

Patient

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Intranasal9%

Pulmonary10%

Transdermal Patch47%

Currently Unavailable but Desirable Method – Diabetes

Transdermal Patch is the most preferred method followed by Pulmonary and Intranasal when all profiled types are considered for new delivery forms by MDs.

Transdermal Patch is the most preferred method followed by Pulmonary and Intranasal when all profiled types are considered for new delivery forms by MDs.

Q2d. Which drug delivery method (if any) that is currently unavailable, do you think should be made available for the for the treatment of <Disease Type>?

MD

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Reasons for Drug Delivery Method to be Made Available - Diabetes

Patient convenience, ease-of-use, and satisfaction are the most appealing attributes of transdermal patches. Pulmonary and intranasal methods are both associated with rapid onset of action, though intranasal is more identified with ease of use.

Patient convenience, ease-of-use, and satisfaction are the most appealing attributes of transdermal patches. Pulmonary and intranasal methods are both associated with rapid onset of action, though intranasal is more identified with ease of use.

What are the top 3 attributes of <method chosen> that make it appealing for the treatment of Diabetes?

52%55%

9%8% 8%

25%

58% 58%

42%

27%

46%

8%

25%

9%8%

25%27%

46%

25%

8%

6%

64%

8%

25%

10%

25%

19%

10%

27%

8%4%

2%

0%

10%

20%

30%

40%

50%

60%

70%

Transdermal Patch Pulmonary/Inhaled Intranasal

Easy for patient to use Patient satisfactionLow cost Minimal adverse side effectsEasy for doctor to administer Requested by patients Patient convenience Rapid onset of actionPatient comfort BioavailabilityLow frequency of dosing Well designed deviceHigher drug absorption Dose accuracyEase of cost reimbursement Formulary tiering of product with the delivery formSpeedy recovery Close proximity of drug to target areaOthers

MD

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Q2f. For each of the following types of drug delivery, please indicate your degree of willingness to use it in the future for <Disease Type>, assuming all these are available, affordable, and can be prescribed by your doctor

Drug Delivery Method – Willingness to Use – Chronic Pain

More than 60 percent of patients are willing/very willing to use a Transdermal patch or a Topical gel/cream for Chronic pain in the future.

More than 60 percent of patients are willing/very willing to use a Transdermal patch or a Topical gel/cream for Chronic pain in the future.

16%24%

17% 18%

36%

24%

38%

4%

18%

32%

14% 10%

23%38%

32%

2%

36%

31%

8%9%

16%20%

14%

3%

22%

11%

37% 37%

18%13% 12%

25%

8%2%

25% 26%

7% 5% 4%

66%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Injection IntravenousInfusion

TransdermalPatch

TopicalGel/Cream

Pulmonary/Inhaled

Implant Intranasal Oral

Indifferent/Don't Know Will Definitely Not Use It

Unwilling but will comply if prescribed by doctor Willing To Use It

Very Willing to Use It

Patient

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Q2h What is your Top reason for your willingness to use these types of drug delivery in the future for <Disease Type>.

Easy to self administer is the top reason for willingness to use for most drug delivery methods. Patients are most willing to use use injection or an intravenous infusion due to its rapid onset of drug action.

Easy to self administer is the top reason for willingness to use for most drug delivery methods. Patients are most willing to use use injection or an intravenous infusion due to its rapid onset of drug action.

23%

5%

58%64%

56%

7%

60%

73%

53%

56%

4%4% 19%

16%

19%3%1%

2%7%

2%

1%

22%

0%1%

2%

5%

7% 9%3%

2%

0%1% 7% 7% 6%

2%

10%4%

2%

11% 10% 11%

20%

14%3%

1%

15%

2%1%

5%

1% 1% 1%

7%2%

4%10%

20%

1% 1% 4%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Injection IntravenousInfusion

TransdermalPatch

Topical Gel/Cream Pulmonary/Inhaled

Implant Intranasal Oral

Easy to self administer Rapid Onset of Drug Action Low frequency of dosingMinimal Side effects No (or Minimal) Discomfort / Pain Low Cost / Insurance Co-PayLikelihood of Reimbursement Very Convenient Well designed deviceMy doctor prefers it Administered by another person Other

Reasons for Willingness to Use Drug Delivery Methods - Chronic PainPatient

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Panel Discussion

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Panel Discussion Points

• Key Benefits to Developers

• Current Value Within Big Pharma

• Challenges with Reformulation and NCE Usage of DD Tech

• New Opportunities for Developers

• Importance of 360 Degree Draw Factors

• Partnership Benefits

• AFRESA Benefits and Challenges with Peer Failures

• Transdermal Applications in Diabetes

• Economic Environment, New Administration, Health Economics

• Importance of Continued Tech Investment

• Business Model Evolution and Sustainability

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