Arctic Aurora LifeScience. Capturing the value in healthcare innovation ARCTIC FUND MANAGEMENT

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1 Arctic Aurora LifeScience Capturing the value in healthcare innovation ARCTIC FUND MANAGEMENT

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3 Arcticc Aurora LifeSciencee Why invest in healthcare? Growth in healthcare is one off the dominating themes for the future. What we know for certain is that we as humans live l longer and that the number off elderly increases dramatically. Agingg population, innovationn and global economicc growth aree the main forces f driving the underlying growth in i healthcare. Healthcare already accounts for 10% of global GDP and future growth is expected to exceed global GDP growth. Diseases are primarily age related, e.g cancer and to meet the demand from a growing population, new medicines are needed. The biotech industry is right now undergoing a transformation based on profound new knowledge in biology and related drug development, resulting in novel therapeutics for previously unmet medical needs. In cancer, scientists are providing new solutions that could transform the treatment into a chronic disease you can live with! In 2014 and 2015 there were more drugs approved in the US than in any of the past 15 years. The likelihood of continued success for the sector is high, new disruptive technologies are entering the market backed with strong balance sheets in the companies. Arctic Aurora LifeSciencee Arctic Aurora LifeScience is a specializedd global healthcare fund investing in primarily public life science companies with focus on Europe and the US. The team are experienced health care specialists with excellent track record from investing in thee public life science sector and with high scientific and industrial competence. By active portfolio management, it offers investors unique exposure to the t growth in the biotech and pharmaceutical industries. The strategy is focused on reaching excess return from investmentss in the biotech sector complemented by investmentss also in thee larger companies such as global pharmaceutical companies. An investment in Arctic Aurora LifeScience provides Exposure to the unique growth in the life science sector through a diversified portfolio Potential to extract excess return from the biotech sector A proven investment strategy withh thorough due diligence of investment opportunities Healthcare is a diversifying asset in a general portfolio A transparent, established fund structure with no long locked in periods Why start investing now? Strong fundamentals with beginning of new era with innovative product development transforming the treatment of diseases. This has attracted high interest from investors in the last 3 years The biotech sector is well funded thanks to record number of IPOs and capital raises Sector rotation and political campaigns ahead of US election have taken valuations down to very attractive levels Large Biotech index has currentlyy (April 2016) lower valuation thann S&P 500, many small biotech with good pipeline priced below cash and Big Pharmaa pipelines almost for free Arctic Aurora LifeScience 1

4 Arctic Aurora LifeScience Investment strategy Active Portfolio Management Investing in biotech and drug development in general requires deep understanding of biology as well as the function of the regulatory and commercial part of drug development, i.e clinical studies and the dynamics between smaller biotech companies and the larger pharmaceutical companies funding the later stages of development and thereby contributing to value creation. Arctic Aurora LifeScience conducts active portfolio management with focus on listed biotech companies supplemented by larger global pharmaceutical companies in both US and EU. Investment philosophy is to build a portfolio of successful companies in the life science sector, based on a thorough due diligence process. Due diligence is a combination of top down where the therapeutic areas of medical and commercial interest are selected. Bottom up the universe is screened for companies owning leading science within the selected therapeutic areas and a deep analysis of those companies are undertaken with the aim of finding the best investment opportunities. To maximize risk/reward we only invest in companies with good clinical data. We do not invest in early stage biotech prior to clinical development in patients. Close contact with management teams is essential The portfolio is constructed in relation to risk and expected return, building a diversified portfolio of approximately holdings. Risks include company specific risks, most importantly drug development risk, liquidity risks and general risks such as currency and political risks. The risk in Arctic Aurora LifeScience will be mitigated by portfolio construction, where company risk and portfolio weight is considered, giving a differentiated exposure. Structure Arctic Aurora LifeScience UCITS fund targeting USD 500 million Domicile Ireland Investor profile: Family Offices, Institutions and retail Fee structure for founding investors: Management fee of 1% and performance fee of 10% measured against the MSCI World/Pharma & Life Science Index Total return Net Index Custodian is BNY Mellon Trust Company (Ireland) Limited Administrator is BNY Mellon Investment Servicing (International) Limited Auditors is Deloitte A senior founding team with broad experience and excellent track record Founder and Chief Investment Officer Ulrica Slåne Bjerke has more than 25 years experience from analyzing and investing in the life science sector. Ulrica has an excellent track record in obtaining significant and repeatable high return of investments Founder Dr Torbjørn Bjerke has had leading positions in the whole chain within drug development, from scientist in international big companies to positions as CSO and CEO for private and public biotech companies taking products to the market Analyst Daniel Bolanowski is an experienced analyst within the life science and healthcare field Arctic Aurora LifeScience 2

5 A team from Arctic Fund Management provides full fundd administration including client support, compliance and risk management Outstanding Advisory Board including 6 senior and veryy successful individuals from the pharmaa and investment industry The team has an extensive global network ncluding executives in the life science industry as well as a profound relation to academia The Team: Ulrica s ROI at AP3: Arctic Aurora LifeScience 3

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8 Arctic Fund Management AS Haakon VII s gate 5 P.O. Box 1833 Vika NO 0123 OSLO, Norway ARCTIC F U N D M A N A G E M E N T Tel Fax fundinvestor.afm@arctic.com