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Cure’s GTX Licensing Opportunity

Cure’s GTX Licensing Opportunity. One Opportunity Too Good to Miss. Summary. Cure is considering licensing from Gastrex two potential new drugs to treat Crohn’s Disease and Ulcerative Colitis.

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Cure’s GTX Licensing Opportunity

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  1. Cure’s GTX Licensing Opportunity One Opportunity Too Good to Miss

  2. Summary Cure is considering licensing from Gastrex two potential new drugs to treat Crohn’s Disease and Ulcerative Colitis GTX-002 is a small molecule kinase inhibitor that may be effective in combination with steroids and/or 5-ASAs, and may replace immuno-modulators for Crohn’s If successful in trials, GTX-002 is likely to be preferred over existing treatments, but at a price too low to make licensing profitable • GTX-001 is a biologic that may be easier to administer and have fewer side effects than biologics currently in use • If successful in trials, GTX-001 is likely to be preferred over existing treatments at a price point making licensing profitable Recommendation: Cure should license GTX-001, but not GTX-002 from Gastrex J, P, Morgan and Associates

  3. Bowel disease has unmet need Mild/Moderate GTX-002 Target • Steroids unsafe for long-term use • 5-ASAs not always effective with Crohn’s • Immuno-modulators have side effects • Biologics hard to administer (IV) and can have severe side effects • No effective drugs Severe GTX-001 Target Refractory J, P, Morgan and Associates

  4. Ulcerative colitis: Unmet needs 40,000 severe cases fail to respond to Remicade (TNF-a inhibitor). No current alternatives. High need 99,000 severe cases respond to Remicade would benefit from drug that provides longer remission rates and remains effective over time. Moderate need 150,000 mild to severe cases treated with steroids for induction. Moderate need to diminish amount used to minimize side-effects 155,000 mild to severe cases treated with immunomodulators for maintenance. Moderate need for safer alternatives GTX-002 target GTX-001 target J, P, Morgan and Associates

  5. Crohn’s disease: Unmet needs GTX-002 target GTX-001 target 65,000 severe cases fail to respond to current TNF-a inhibitors. Tysabri presents safety concerns. High need 145,000 severe cases respond to TNF-a inhibitors. Moderate need for drug with longer remission rates administered subcutaneously 180,000 mild to severe cases treated with steroids for induction. Moderate need to diminish amount used to minimize side-effects 227,000 mild to moderate cases treated with 5-ASAs. Moderate need for drug that increases remission rates 135,000 mild to severe cases treated with immunomodulators for maintenance. Moderate need for safer drug J, P, Morgan and Associates

  6. Market size is sufficient for development GTX-001 could serve 30% of Biologics; 50% of Refractory patients GTX-002 could serve 80% of 5-ASA Crohn’s; 80% of Steroids and IM patients J, P, Morgan and Associates

  7. Comparison of GTX-001 to competitors Key + Favorable for patients - Harmful to patients November 2009 J, P, Morgan and Associates 7

  8. Comparison of GTX-002 competitors Key + Favorable for patients - Harmful to patients November 2009 J, P, Morgan and Associates 8

  9. Delayed milestone payments lowers cost Milestone Payment Milestone Payment Milestone Payment Milestone Payment J, P, Morgan and Associates

  10. Milestones Specified

  11. Conclusion/Results: NPV of licensing option • Considering only US and EU J, P, Morgan and Associates

  12. Sensitivity AnalysisDiscounted Cash Flows over TimePositive NPV for GTX-001 Robust with Changing Assumptions J, P, Morgan and Associates

  13. Appendix A: Assumptions • Price=average price of competitors • 5 years to maximum adoption rate • Population growth rates .5% for UC; for Crohn’s population growth rates in document • 50% operating margin • Tax percentage = 21.2% from comparables • WACC = 6.06% from comparables • Clinical trial phase lengths • No cannibalization (we are not current producer) • Trial success probabilities • Cure has ready access to capital for investment • Cure has operating profits against which to apply tax credits J, P, Morgan and Associates

  14. Appendix B: Remicade Clinical Trials Data Source:http://www.cigna.com/customer_care/healthcare_professional/coverage_positions/pharmacy/ph_5112_coveragepositioncriteria_infliximab_remicade.pdf

  15. Appendix C.1: Financial Model J, P, Morgan and Associates

  16. Appendix C.2: Financial Model J, P, Morgan and Associates

  17. Appendix E: Comparables J, P, Morgan and Associates

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