Clavis Pharma ASA is a clinical-stage oncology focused pharmaceutical company with a portfolio of novel anti-cancer drugs in development

Transcription

1 Annual Report 2010 THE KEY TO IMPROVED CANCER THERAPY

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3 4 About Clavis Pharma 4 Key Financial Figures 5 Highlights 2010 and 2011 to date 6 Introducing Clavis Pharma 7 Letter from the CEO 8 Unique LVT Technology Platform 10 Drug Development Pipeline 18 The Drug Development Process 20 Board of Directors 22 Management 24 Shareholder information 26 Corporate governance 29 Financial information 29 Directors report for Responsibility Statement 36 Financial Statements 40 Notes to the Financial Statements 56 Auditor s report 58 glossary of terms Clavis Pharma ASA is a clinical-stage oncology focused pharmaceutical company with a portfolio of novel anti-cancer drugs in development

4 4 About Clavis Pharma Key Financial Figures Key figures from P&L (NOK 1 000) Total operating income Payroll and payroll related costs Other operating costs Loss for the year Key figures from the balance sheet (NOK 1 000) Cash & cash equivalents Total assets Total equity Share data Earnings per share (NOK) Number of shares outstanding as at Exchange rates (year end) USD/NOK EUR/NOK Financial calendar 2011 Ticker symbol Event Date First quarter results Annual General Meeting Second quarter results Third quarter results 5 May 26 May 25 August 27 October Oslo Børs Reuters Bloomberg CLAVIS CLAVIS:OL CLAVIS:NO

5 About Clavis Pharma 5 Highlights 2010 Elacytarabine Phase III CLAVELA study with elacytarabine in patients with late stage acute myeloid leukaemia (AML) initiated mid Phase II study (study 205) with elacytarabine in combination with idarubicin in patients with early stage AML initiated early Fast track designation granted by the US Food & Drug Administration in December. CP-4216 (also known as CO-1.01) USD 205 million partnership for the development and commercialisation of anti-cancer agent CP-4126 signed with Clovis Oncology, Inc. for Asia and RoW in November Clovis Oncology is global partner for CP-4126 following 2009 deal for Americas and Europe (combined deal value of USD 585 million, with USD 25 million received in upfront payments). CP-4126 entered a randomised Phase II study in patients with pancreatic cancer mid 2010 (later named the LEAP study). Licence agreements signed with Ventana Medical Systems, Inc. (Roche) for hent1 biomarker development. The US FDA granted orphan drug designation to CP-4126 for the treatment of pancreatic cancer in January. CP-4200 Preclinical toxicology programme for CP-4200, a potential new treatment of solid tumours and haematological malignancies, was initiated. Diagnostics An in vitro diagnostic (IVD) assay for analysing hent1 status in solid tumour tissue was developed, CE marked and made commercially available through Ventana Medical Systems. New Board and Executive Management appointments Anders P. Wiklund was elected Chairman of the Board of Clavis Pharma and Annette Clancy was elected as Non-executive Director at the Annual General Meeting in May Olav Hellebø was appointed Chief Executive Officer of Clavis Pharma in February. Athos Gianella-Borradori, MD appointed as Chief Medical Officer in June. New funding secured to reach key clinical milestones NOK 154 million raised in November/December 2010 from a successful private placement. USD 10 million (NOK 59.5 million) received in connection with the licensing agreement with Clovis Oncology for CP-4126 in Asia. NOK 20 million loan received from Innovation Norway support clinical development of elacytarabine. Year-end cash balance was NOK million to date CP-4126 Additional Phase II study started for CP-4126 as a second line treatment for advanced, metastatic pancreatic cancer in patients refractory to first line gemcitabine treatment. The number of patients to be enrolled in the randomised Phase II LEAP study has been increased from 250 to 360. This increases the statistical power of the study and LEAP becomes a pivotal trial for registration. Completion of funding process Subsequent share issue of NOK 21 million completed in January 2011, raising total gross proceeds from the latest funding round to NOK 175 million.

6 6 About Clavis Pharma Introducing Clavis Pharma Our vision is to build Clavis Pharma into a profitable, internationally recognised pharmaceutical company developing and commercialising improved anti-cancer drugs based on our proprietary technologies, to the benefit of patients. Clavis Pharma ASA is a clinical-stage oncology focused pharmaceutical company based in Oslo, Norway, with a portfolio of novel anti-cancer drugs in development. These patented New Chemical Entities (NCEs) are novel, improved versions of widely used and commercially successful drugs, made using Clavis Pharma s Lipid Vector Technology (LVT) chemistry. Data generated suggest these potential breakthrough products may offer improved efficacy and reduced side effects through enhanced pharmacokinetic properties, greater tissue penetration, altered metabolism and, in certain cases, additional modes of action. Clavis Pharma has three drug candidates in formal development studies: Elacytarabine, currently in a randomised, controlled Phase III study (CLAVELA) in late stage acute myeloid leukaemia (AML) and a Phase II study in combination with idarubicin in early stage AML; CP-4126 (also known as CO-1.01), is in a Phase II comparative study (LEAP) with gemcitabine for the treatment of pancreatic cancer and a Phase II trial for second line treatment for pancreatic cancer in patients refractory to first line gemcitabine treatment; and CP-4200, an azacitidine derivative in preclinical development for myelodysplastic syndrome (MDS), often a precursor to myeloma or leukaemia. Clavis Pharma intends to commercialise its products through strategic alliances and partnerships with experienced oncology focused pharmaceutical companies and, where and when commercially appropriate, by establishing its own sales and marketing capabilities. CP-4126 is licensed to Clovis Oncology, Inc. globally and Clavis Pharma has an option to co-promote CP-4126 in Europe. Clavis Pharma was founded in 2001 and its shares are listed on the Oslo Stock Exchange (ticker: CLAVIS). Clavis pharma drug candidates Parent drug FEASIBILITY Pre Clinical Clinical Phase I Clinical Phase II Clinical Phase III Elactyrabine AML* late stage AML* early stage CP-4126** Pancreatic cancer First line Second line CP-4200 MDS*** Ara-C/ Cytarabine Gemcitabine/ GEMZAR Azacitidine/ Vidaza Exploratory compounds * AML=Acute Myeloid Leukaemia ** Licensed to Clovis Oncology globally *** MDS=Myelodysplastic Syndrome

7 About Clavis Pharma 7 Letter from the CEO: Well positioned for future growth When I joined Clavis Pharma in February 2010 I was excited about the unique technology platform and the energy and competence of the Clavis people. Now, one year later and with the opportunity to learn much more, I am even more enthusiastic has been a year of excellent progress for Clavis Pharma. Pivotal clinical trials were initiated for both of our lead drug candidates and further R&D activities contributed to advancing our pipeline. Our partnership with Clovis Oncology for CP-4126 has been very successful, and strengthened by a USD 205 million worldwide deal extension signed in November. Finally, financing was secured through the payments from our partner Clovis Oncology and a private placement of shares. Clavis Pharma became a Phase III company in 2010 through the initiation of the CLAVELA study in late stage AML. This clinical trial will enrol 350 patients who have failed at least two prior alternative therapies and aims to show that elacytarabine is an effective treatment option for these severely ill patients. We expect to report results from this trial in the middle of Our second drug candidate, CP-4126, also advanced significantly through the initiation of the LEAP study for patients with previously untreated metastatic pancreatic cancer. This study compares CP-4126 with gemcitabine and was initially aimed to enrol 250 patients. Together with our partner, Clovis Oncology, we recently decided to increase enrolment to 360 patients to improve the likelihood of the study reaching its primary endpoint. Study results are expected at the end of 2012, and if successful, marketing approval applications will be submitted to regulatory authorities with a potential for endorsement in Toxicology studies were also initiated during 2010 for our third drug candidate, CP-4200, which initially will be developed for patients with MDS. CP-4200 is designed to be an improvement over Celgene s Vidaza (azacytidine) in terms of penetration into cancer cells and thus improved clinical efficacy. We expect to initiate a first clinical study for CP-4200 in Our portfolio of compounds is designed to work in cancer patients, and particularly in those with low levels of hent1, an important transporter of drugs through the cellmembrane. Biomarker and companion diagnostic development is ongoing to enable the identification of these patients. The first diagnostic test for hent1 levels in pancreatic cancer patients was CE marked by Ventana (Roche) in December. We are focused on areas with large unmet medical needs, and consequently, attractive commercial market opportunities. Our long-term goal for elacytarabine is to replace cytarabine as the gold-standard treatment option in AML. Cytarabine is today the undisputed first-choice treatment and virtually every AML patient will receive at least one course of cytarabine therapy. CP-4126 is aimed at the large solid tumour market and we are, together with our partner, enthusiastic about the prospects in this market. The initial indication, pancreatic cancer, is dominated by Eli Lilly s Gemzar (gemcitabine). Our primary goal for CP-4126 is to replace gemcitabine in the treatment of low hent1 patients with metastatic pancreatic cancer. In November 2010, we expanded our development and commercialisation agreement with Clovis Oncology to include global territories. The expanded agreement is now worth up to USD 585 million in up-front and milestones payments as well as significant royalties on net sales. Clovis Oncology will fund the large majority of development activities. We have retained the option to co-promote CP-4126 with Clovis Oncology in Europe. This fits with our vision of building a commercial capability for Clavis Pharma in this territory. Clavis Pharma s financial position was strengthened during 2010 as a result of the successful NOK 154 million private placement in November, the additional USD 10 million up-front payment from Clovis Oncology on extending our partnership agreement and the receipt of a NOK 20 million loan from Innovation Norway. This is giving us the necessary financial platform to progress our pipeline at high speed and to deliver the key clinical milestones for our product candidates. Our mission is to use our technology platform to help patients in their fight against cancer and improve their lives. Thanks to the great skills, efforts and support of our employees, collaborators and shareholders, we are now closer to achieving this goal than ever before. Olav Hellebø Chief Executive Officer

8 8 About Clavis Pharma Unique LVT Technology Platform The Lipid Vector Technology (LVT) is a unique proprietary technology platform that enables Clavis Pharma to create New Chemical Entities (NCEs) by significantly improving already well established drugs. The new NCEs may offer improved efficacy and reduced side effects. Some of the key benefits of the LVT products are: Bypassing drug resistance Improved efficacy Prolonged effect (wider therapeutic window) and improved safety profile Personalised medicine through biomarker-driven patient selection Lipid Vector Technology involves the chemical linking of specific lipids (vectors) to selected pharmaceutical agents (parent drugs). The new molecule thus created is a New Chemical Entity (NCE) that can be patented. A large number of the Company s NCEs covering a wide range of therapeutic areas have in model systems demonstrated enhanced biological performance over the parent drug. Clavis Pharma has shown that a variety of drug characteristics can be improved by linking lipids to a drug. Focus on improved anti-cancer drugs The Company s initial focus has been to apply LVT to marketed cancer chemotherapy drugs with well-characterised properties, thus providing a clear demonstration of the benefits of LVT. Most pharmaceuticals have potential for improvement in efficacy and fewer side effects. Many pharmaceuticals also have room for improvement in characteristics such as bioavailability and pharmacokinetics, which might lead to better dosing schedules or more convenient/less expensive routes of administration. Although anti-cancer drugs often prolong life rather than cure the disease, many such drugs are blockbusters (annual sales over USD 1 billion). This is evidence of the continuing unmet medical need in cancer therapy and the great opportunity for improvement by introducing safer, more efficacious and reliable versions of existing drugs. Clavis Pharma has tested multiple chemical entities and has developed a library of hundreds of LVT-improved compounds, many of which have the potential to improve both the original drug s efficacy and safety profiles. LVT addresses drug resistance in cancer cells Drugs that need to enter cells to reach their targets often involve tightly controlled transport mechanisms within the cellular Lipid Vector Technology Parent Drug + = Lipid Vector New Chemical Entity Fig 1. How does LVT work: LVT involves the chemical linking of specific lipids (vectors) to selected pharmaceutical agents (parent drugs).

9 About Clavis Pharma 9 membrane that are specific to the class of compounds in question. Sometimes the level of drug flow through such transport mechanisms (influx) restricts the amount of drug transported into a cell thereby limiting the efficacy of the drug. In preclinical models, new drug candidates derived using LVT have been found to overcome such insufficient transport into cells resulting in several-fold increases in cellular uptake. Specifically, nucleoside drugs depend on nucleoside transporters to enter cancer cells where they exert their cytotoxic effect by inhibiting DNA synthesis and preventing cancer cell division and proliferation (Fig. 1). Cytarabine and gemcitabine are two wellestablished and highly successful nucleoside anti-cancer drugs that depend on a transporter called human Equilibrative Nucleoside Transporter 1 (hent1) to be effective. This has important biological consequences, as a considerable proportion of cancer cells have low expression of hent1. The poor clinical response of patients to treatment with elacytarabine and gemcitabine has through independent clinical research published in international medical journals been correlated with reduced levels or absence of hent1 in the cancer cells (Fig. 2). Clavis Pharma s drug candidates in clinical development, elacytarabine and CP-4126, are LVT derivatives of cytarabine and gemcitabine, respectively. In contrast to their parent drugs, Clavis Pharma s compounds are able to enter the cells independently of hent1 (Fig.3). Once inside the cell the lipid tail of the LVT drug is cleaved off and the parent drug is released. In cells with low levels or absence of hent1, the drug is trapped inside the cell (Fig.3), where it exerts its anti-cancer effect. The above-mentioned observations suggest that elacytarabine and CP-4126 may be clinically active in tumours that are resistant to cytarabine and gemcitabine due to low hent1 expression. This could be important for patients with a poor response to treatment in both AML and pancreatic cancer. A companion diagnostic for improving treatment As part of its clinical development programmes, Clavis Pharma is measuring hent1 levels in tumours from cancer patients. These data will both give information on the prevalence of hent1 expression in the relevant tumours and will help determine if hent1 levels are an accurate indicator of how a patient might respond to drugs that depend on hent1 to enter cancer cells. A diagnostic based on this principle would also enable clinicians to prescribe the most appropriate treatment and select the patients who are most likely to benefit from LVT-based therapy. These patient groups represent a high unmet medical need, because they may have life-threatening disease with no good current treatment options. Clavis Pharma, and its partners, are developing biomarker assays to identify these patients and make these assays available for patient selection in a commercial setting. From a patient perspective, this approach is in line with current trends toward more personalised treatment. Fig. 1 Fig. 2 Fig. 3 Nucleoside analogue drugs depend on nucleoside transporters to enter the cells where they exert their effect

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11 About Clavis Pharma 11 Drug Development Pipeline The market for anti-cancer drugs is large and growing. There is a high umnet medical need in cancer treatment, which presents multiple opportunities for the development of effective new therapies including accelerated or fast track regulatory pathways. Clavis intends to leverage its LVT technology to develop a strong pipeline of proprietary new and improved anti-cancer drugs. Clavis Pharma is focusing its development efforts on three candidates: Elacytarabine: Acute Myeloid Leukaemia (AML) LVT derivative of cytarabine gold standard in leukaemia treatment Positive AML Phase II data threefold increase in survival Pivotal Phase III CLAVELA study in late stage AML initiated mid 2010 Orphan drug and fast track designations granted Composition of matter patent to 2021 (with extension) CP-4126: Solid Tumours LVT derivative of gemcitabine gold standard in pancreatic cancer treatment Randomised pivotal Phase II initiated mid 2010 Partnered with Clovis Oncology Orphan drug designation granted Composition of matter patent to 2023 (with extension) CP-4200: Myelodysplastic Syndrome (MDS) LVT derivative of azacitidine gold standard in MDS treatment Positive preclinical data demonstrates superiority over azacitidine Clinical Phase I to commence 1H 2011 Composition of matter patents expected to 2023 (with extension)

12 12 About Clavis Pharma Elacytarabine Elacytarabine (CP-4055) is a novel, patented LVT derivative of the anti-cancer drug cytarabine (Ara-C) that has the potential to improve treatment outcomes in patients with AML and other haematological malignancies (leukaemias). Elacytarabine is in two clinical trials: Phase III study (called CLAVELA) in late stage AML was initiated in mid 2010 and enrolled its first patient in August Phase II study in early stage AML evaluating elacytarabine in combination with idarubicin also began in 2010 and is enrolling patients. The US Food & Drug Administration (FDA) and the European Medicines Agency (EMA) have granted orphan drug designations to elacytarabine for the treatment of AML. These designations entitle Clavis Pharma to exclusive marketing rights for seven and ten years in the US and the EU respectively, from the date of the marketing approval. Elacytarabine enters cancer cells independent of hent1 levels In hent1-blocked cancer cells In cancer cells Metabolite level pmol/10 cells Time (minutes) Elacytarabine metabolite in hent1-blocked cancer cells Cytarabine metabolite in hent1-blocked cancer cells Metabolite level pmol/10 cells Time (minutes) Elacytarabine metabolite in cancer cells Cytarabine metabolite in cancer cells High cellular uptake with LVT elacytarabine vs. cytarabine. It is estimated that approximately one third of AML patients has low or reduced levels of the hent1 transporter protein, and thus may not respond well to cytarabine treatment. The lack or reduced expression of hent1 in patients treated for leukemia is significantly associated with a poor outcome 1. Studies have demonstrated that elacytarabine overcomes this type of drug resistance by entering the cells via different mechanisms, and thus is not dependent on hent1. In December 2010, elacytarabine also received fast track designation from the FDA for the treatment of AML. The designation will provide elacytarabine with a priority review of six months instead of the standard 10 months. Completed clinical studies highlight promise of elacytarabine A Phase II study evaluating the efficacy and safety of elacytarabine in patients with late stage AML who have failed first and second line therapies has been completed and the results were presented at the American Society of Hematology annual meeting in November In the trial, elacytarabine showed statistically significant superior efficacy compared to published clinical data for these difficult to treat AML patients 2. There is currently no standard therapy available for these patients and life expectancy is very short. The key results were: Median survival three times longer (5.3 months vs. 1.5 months) Remission rate significantly increased (14.8% vs. 2.5%, p<0.0001) Well tolerated short-term mortality substantially lower (13% vs. 25%) Based on these encouraging results, the Company initiated the CLAVELA study. Phase III study (CLAVELA) in late stage AML Clavis Pharma received FDA s support of the CLAVELA protocol on 24 May 2010, and the first patient entered the study in August CLAVELA is an open-label, randomised study that aims to enrol 350 patients with late stage AML who have failed two or three previous treatment regimes, at 75 haematology clinics in North America, Europe and Australia. The primary objective of the study is to compare overall survival (OS) between patients treated with elacytarabine and patients randomised to a control therapy. The secondary objectives are to compare the response rates, duration of response, and safety profile of elacytarabine with the control therapy. Patients randomised to the control therapy group can receive a range of treatments including: High-dose cytarabine for up to six days MEC-mitoxantrone, etoposide and cytarabine FLAG or FLAG-IDA-fludarabine, cytarabine, G-CSF and idarubicin Low-dose cytarabine for up to two weeks Hypomethylating agents azacytidine or decitabine Best supportive care The company expects to complete patient recruitment by the end of 2011 and to report results in the middle of The results from this study, if positive, will be used by Clavis Pharma to support regulatory filings in the USA and Europe. The Chairman of the CLAVELA study s steering committee is Professor Francis J. Giles, Director, HRB Clinical Research Facility, National University of Ireland Galway & 1) Hubeek et al, Br J Cancer 2005, Galmarini et al, Leukemia Research 2) Per protocol historic control were 594 patients treated at MD Anderson Giles et al Cancer (2005)104:

13 About Clavis Pharma 13 CLAVELA is enrolling partients at 75 clinical sites in North America, Europe and Australia. Trinity College. Prof. Giles was also Coordinating Investigator of Clavis Pharma s Phase II study with elacytarabine. Phase II trial in early stage AML Elacytarabine is also being tested in a Phase II trial in combination with idarubicin, an anti-leukaemia drug commonly used in combination with cytarabine. This Phase II study aims to enrol 50 AML patients who have failed their first course of cytarabinebased chemotherapy. Patients will also have their hent1 level measured. The objective of the trial is to study response rates to the combination treatment and the relationship of response to the patient s hent1 status. The goal is to demonstrate that, unlike cytarabine, the efficacy of elacytarabine is independent of the patient s hent1 status. elacytarabine. The method is targeted to run on a flow cytometry platform, enabling rapid analysis on diagnostics systems widely used in haematology laboratories. About Leukaemia Approximately 300,000 new cases of leukaemia are diagnosed globally each year, and it is responsible for around 220,000 deaths annually. Leukaemia represents a market with high unmet medical needs, which can lead to accelerated approval processes to expedite market access for new drugs. It is a segmented market covering a broad variety of disorders. A major clinical concern is the high rate of disease recurrence. Acute myeloid leukaemia (AML) is the most common acute leukaemia type. The five-year survival for AML patients is in the range of 5-10% for treated elderly patients and approximately 30% for treated younger adults. Sales of products for treatment of AML patients are estimated to be in the order of USD 1 billion globally and this is expected to grow significantly over the coming years. Cytarabine is currently used in approximately two thirds of patients with AML and is used also to treat other haematological malignancies. Top-line data from the study is expected in 2011 and is anticipated to generate data that will be important to support the design of a pivotal Phase III trial for patients with early stage AML. hent1 diagnostic In parallel to its clinical study programme, Clavis Pharma is developing a novel hent1 biomarker diagnostic method to enable the pre-selection of AML patients with low hent1 status. It is believed that such patients will be poor responders to cytarabine treatment, but may benefit from treatment with Market potential elacytarabine USD 1 Billion Market* and... 2/3 of Patients Treated with cytarabine 87% 13% 34% Ara-C/Cytarabine Other Therapies * Based on Datamonitor Sales Estimates for Individual Products and IMS sales data for Dacogen, Vidaza, Leukine, Trisonex, cytarabine, DaunoXome, Adriamycin, Ceplene and Gleevec 66%

14 14 About Clavis Pharma CP-4126 CP-4126 is a novel, patented, LVT derivative of the anti-cancer drug gemcitabine, the current standard treatment for solid tumours such as advanced pancreatic cancer. Gemcitabine is also widely used in combination with other chemotherapy agents for the treatment of other cancers, including, non-small cell lung, ovarian, gastro-intestinal and breast cancer. CP-4126 is in two clinical trials: A Phase II comparative pivotal study (called LEAP) with gemcitabine for the treatment of pancreatic cancer was initiated mid 2010 and enrolled its first patient in August. A Phase II trial for second line treatment for pancreatic cancer in patients refractory to first line gemcitabine treatment initiated in late 2010 and enrolled its first patient in January CP-4126 has been granted Orphan drug status for the treatment of pancreatic cancer by both FDA and EMA. CP-4126 is partnered with Clovis Oncology CP-4126 is being developed under a partnership agreement between Clavis Pharma and Clovis Oncology, Inc. Under the terms of the agreement, Clovis Oncology is responsible for product development and manufacturing of CP-4126, for filing of applications for marketing approvals and for commercialisation globally. These activities are done in close collaboration with Clavis Pharma. The majority of the development costs are covered by Clovis Oncology. The agreement was initially signed in November 2009, for commercialisation in the Americas and Europe, and was expanded in November 2010 for Asia and the rest of the world. Clavis Pharma retains the option to co-promote CP-4126 in Europe. In total, Clavis Pharma has received upfront cash payments of USD 25 million from Clovis Oncology and will be eligible to receive further payments totalling up to USD 560 CP-4126 enters cancer cells independent of hent1 levels In hent1-blocked cancer cells In cancer cells Metabolite level pmol/10 cells Time (minutes) CP-4126 metabolite in hent1-blocked cancer cells Gemcitabine metabolite in hent1-blocked cancer cells million on Clovis Oncology s successful attainment of development, regulatory and sales milestones. Clavis Pharma will receive tiered double-digit royalties on all product sales in the licensed territories. Clovis Oncology is a anti-cancer drug development company led by former executives of Pharmion Corp. (now part of Celgene Corp.) and founded in 2009 with the backing of leading international healthcare-focused investors. While at Pharmion, the Clovis Oncology Metabolite level pmol/10 cells Time (minutes) CP-4126 metabolite in cancer cells Gemcitabine metabolite in cancer cells CP-4126 vs. gemcitabine uptake in cancer cells. In preclinical models CP-4126 demonstrated the ability to enter tumour cells independent of the hent1 transporter protein and delivers active drug inside the cells. Studies also showed an increase in intracellular drug levels, relative to cells with functioning transporters. This may be explained by a greenhouse effect whereby the active drug relieved of its fatty acid tail inside the cell is trapped inside as there are no functional transporters by which it be pumped out of the cell (see Fig 3, page 10). Gemcitabine 100 Percent alive Low, high (>50%) H.R. = % CI = (0.22, 0.75) P-value = Years from randomization No staining management team gained regulatory approval for and launched Vidaza (azacitidine) in the US and Europe for the treatment of MDS, and gained regulatory approval for thalidomide for the treatment of multiple myeloma in Europe and other international markets. Pivotal Phase II clinical programme CP-4126 is currently in a Phase II clinical trial as a first line treatment for pancreatic cancer (the LEAP study). The first patients entered Survival curve of 91 patients with pancreatic cancer treated with adjuvant gemcitabine, classified by positive or negative hent1 staining. It is estimated that due to deficient expression of hent1 at least 50% of patients with pancreatic tumours have limited cellular uptake of gemcitabine and therefore respond poorly to treatment. This has been confirmed in several studies of patients with pancreatic cancer where a low level of the hent1 biomarker has been correlated with poor outcomes after gemcitabine therapy. Published research has also suggested that hent1 levels correlate with outcomes in lung cancer patients treated with gemcitabine-containing chemotherapy.

15 About Clavis Pharma 15 the study in August and approximately 360 patients will be enrolled in this international, randomised, comparative Phase II trial of CP-4126 vs. gemcitabine. The objective is to demonstrate superiority of CP-4126 over gemcitabine in the low hent1 patients with overall survival as a primary endpoint. The hent1 status of all patients will be determined using a diagnostic test developed by Ventana Medical Systems. This study is a well-powered, prospective test of two hypotheses: (1) low pancreatic tumour hent1 expression is associated with poor outcome after gemcitabine therapy, and (2) CP-4126 will have superior efficacy in hent1- low patients compared with gemcitabine. The trial is expected to be fully enrolled by the end of 2011 with top-line data expected end The safety and pharmacokinetics (PK) of CP-4126 were evaluated in a Phase I clinical study in patients with various solid tumours. The PK data confirmed that administration of CP-4126 provided a prolonged presence of the therapeutically active agents in the blood. In line with preclinical data, the Phase I results suggest that the drug may be of clinical benefit for patients that do not respond to gemcitabine as well as for patients that currently benefit from gemcitabine. New Phase II study in gemcitabinerefractory patients A new clinical Phase II trial (called CO or study 003) investigating the use of CP-4126 as a second line treatment for advanced, metastatic pancreatic cancer in patients refractory to first line gemcitabine treatment was initiated in late The study is a 35-patient, single arm, Phase II multicentre study that will be conducted at US sites. The first patient was enrolled in January 2011 and results are expected to be reported in Pancreatic cancer patients will be eligible for inclusion if they were refractory to first line gemcitabine treatment (gemcitabine-refractory) and their tumours show no expression of hent1. The primary objective of this study is to determine disease control rate (DCR or best response of complete response [CR], partial response [PR], or stable disease [SD]). CP-4126 treatment will continue until tumour progression or toxicity occurs. Companion diagnostic As a key element of the CP-4126 clinical programme, a validated companion diagnostic test to reliably determine pancreatic tumour hent1 expression and enable patient stratification will be developed by Ventana Medical Systems and Clovis Oncology under licence from Clavis Pharma. Ventana reached the first major milestone on this development when their diagnostic assay for analysing hent1 status in solid tumour tissue was CE marked and made commercially available in December A retrospective observational study of hent1 expression in pancreatic cancer patients (called CO or study 002) began in Tumour tissue samples and clinical outcomes will be made available from patients who have participated in previous clinical studies. The objective is to define the criteria for low and high hent1 expression, which in turn will be used to stratify patients in the ongoing LEAP study. Results of this study will be released in mid About Pancreatic cancer Pancreatic cancer presents a major unmet medical need due to the poor survival outcomes and limited number of therapeutic options available to patients. Approximately 43,000 new cases of pancreatic cancer will occur in the US in 2010, with a similar number occurring in Europe. The one-year and five-year overall survival rates are estimated at 23% and 4%, respectively. The majority of pancreatic cancer patients are diagnosed with unresectable locally advanced or metastatic disease. The average life expectancy for a pancreatic cancer patient following diagnosis is only 5-8 months. Poor outcomes for pancreatic cancer are due, in large part, to the fact that the majority of patients with pancreatic cancer are diagnosed once the disease has progressed to an advanced level. Approximately 50% of patients at the time of diagnosis will have metastatic disease and an additional 25-35% will have a regional spread of disease. Pancreatic Cancer Annual Incidence Total EU Big Five US

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17 About Clavis Pharma 17 CP-4200 The Company s third product candidate, CP-4200, is in preclinical development and represents a new family of LVT drugs for the treatment of cancer and haematological malignancies. CP-4200 is a novel LVT derivative of azacitidine, which is currently approved and marketed by Celgene Corp. as Vidaza for myelodysplastic syndromes (MDS), certain forms of AML and chronic myelomonocytic leukaemia (CMML). Azacytidine is dependent on hent1 to enter cells where it acts to modify gene expression (epigenetic modulator) rather than as a traditional cytotoxic drug, such as gemcitabine or cytarabine. Epigenetic modulators are intended to restore the normal function of genes that control how cells develop and grow in the human body at doses with low cytotoxic activity. In preclinical studies CP-4200 has demonstrated cellular uptake independent of hent1. It was also found to be more stable in plasma than azacitidine and has a more rapid onset of cytotoxic effect and stronger epigenetic effect. The formal preclinical toxicology studies necessary prior to the application for a clinical trial have been completed. Clavis Pharma is planning to enter CP-4200 into clinical Phase I during the first half of CP-4200 is licensed from The Mount Sinai Medical Center and its renowned Mount Sinai School of Medicine (MSSM) in New York. USA. Researchers at MSSM s oncology division collaborated with Clavis Pharma on preclinical studies of CP Jointly owned IP rights have been filed, and the Company has an exclusive worldwide licence to all IP relating to CP-4200 and related compounds. About Myelodysplastic Syndrome (MDS) MDS covers a diverse collection of haematological conditions united by ineffective production (or dysplasia) of myeloid blood cells and risk of transformation to acute myeloid leukaemia (AML). The incidence of MDS in 2010 has been estimated at 31,000 across the seven major pharmaceutical markets and the incidence has been forecast to increase to 34,000 in Although diagnosis of MDS has improved in recent years, it is believed that the disease is still under-diagnosed and the epidemiology of the disease remains uncertain.ematopoietic stem cell transplantation is the only potentially curative therapy for MDS, but is only applicable to a subset of patients. MDS Annual Incidence Total EU Big Five US Strong Additional Potential Clavis Pharma has demonstrated that its LVT platform can provide other favourable clinical traits in addition to greater bioavailability of existing pharmaceutical products. This will potentially provide additional novel LVT-based derivatives, with superior efficacy over the parent drugs and also may circumvent clinical issues that caused promising anti-cancer drugs to fail in late stage development. LVT derivatives of a range of anti-cancer drugs, such as nucleosides, anthracyclines and taxanes have been prepared and screened in vitro and in vivo. Improved activity, enhanced cellular uptake, a better toxicity profile and the possibility of alleviating certain drug resistance mechanisms have all been demonstrated in one or more of the LVT derivatives. Clavis Pharma plans to use LVT to generate further drug candidates, the best of which it will enter into preclinical and clinical development. Intellectual Property Patenting new drug candidates secures Clavis Pharma s worldwide rights to such compounds and form a key part of the Company s R&D strategy. The Company has a patent portfolio that offers composition of matter protection for a large number of specific LVT compounds that includes more than 165 approved patents in ten patent families. The patents and patent application owned by Clavis Pharma cover both processes, products, formulation and product application. Both the US Food & Drug Administration (FDA) and the European Commission has granted orphan drug designation to elacytarabine for the treatment of AML, and to CP-4126 for the treatment of pancreatic cancer. The orphan drug designations give the Company exclusive marketing rights for 7-10 years in the US and EU respectively from the date of marketing approval.

18 18 About Clavis Pharma

19 About Clavis Pharma 19 The Drug Development Process Different Phases of Drug Development Research Phase Preclinical phase Clinical Phase I Clinical Phase II Clinical Phase III Early screening of large number of compounds Lengthy studies of novel principles High risk 2-10 years of research Studies of efficacy and toxicity Development of process for drug product 1-3 years IND Clinical approval 30 day First studies in humans Safety On patients except in cancer therapy 1-3 years Patients in given disease area (indication) Efficacy 2-3 years Large number of patients Efficacy compared to gold standard 3-4 years Pharmacoeconomic studies NDA Market approval 1 year Marketing (Clinical Phase IV) Marketing approval obtained New indications studies and approved VALUE INCREASE The Drug Development Process The traditional research and development process for a new drug is long and expensive, but it offers potential high financial returns for those that succeed. The main phases in drug development are shown above. Clinical studies (studies in humans) represent the ultimate pre-market testing ground for unapproved drugs. During these trials, an investigational compound is administered to humans and evaluated for its safety and effectiveness in treating a specific disease. Clinical trials are usually carried out in three consecutive phases (I-III). Phase I studies are designed to determine the safety of the drug in humans, i.e. the actions and the side effects associated with increasing doses. They are generally carried out on healthy volunteer subjects. However, Phase I trials for oncology products are normally carried out on cancer patients Phase II includes the early controlled clinical studies to obtain preliminary data on the effectiveness of the drug for a particular indication in patients with the disease. The most common side effects and risks associated with the drug are also determined. Phase II studies are typically conducted in a relatively small number of patients, usually involving up to several hundred people Phase III involves expanded trials intended to gather the additional information regarding effectiveness and safety that is required to evaluate the overall benefit-risk relationship of the drug. The studies should provide an adequate basis for extrapolating the results to the general population and transmitting that information to physicians in the product label. Phase III studies generally include from several hundred to several thousand people

20 20 About Clavis Pharma Board of Directors Members of the Board Anders P. Wiklund Geir Stormorken ANNEE CLANCY Kaci Kullmann Five Chairman, has over 40 years of experience in the biotechnology and pharmaceutical industry. In 1997 he founded Wiklund International, an advisory firm to the biotech industry. He has since worked with clients from Europe and North America as an advisor to CEOs. In addition, from 2007 to 2009 he was President of the US-based company EffRx Inc. In 1997 he co-founded Esperion Therapeutics and served on the board of directors prior to its acquisition by Pfizer. He spent 29 years with the Kabi and Pharmacia group of companies, where he held a number of different positions, such as Managing Director of KabiVitrum in the UK, President of KabiVitrum International in Sweden, President and CEO of KabiVitrum and KabiPharmacia in the USA. Presently Mr Wiklund serves on the board of Inspirion Delivery Technologies in the US, Pharmalink and Life Medical in Sweden, and EffRx in Switzerland. He has a Masters degree in Pharmacy from Stockholm, where he also studied Business Administration. He is Swedish citizen and resides in Stockholm, Sweden. Deputy Chairman, has been the Managing Director of investment company Braganza AS since Braganza AS is one of the major shareholders of Clavis Pharma. He has previously held i.a. senior financial management positions in Braathens ASA from 1989 to 1997, and has broad experience as director and chairman of a number of companies across several industries. Mr Stormorken holds a M.Sc. in Business Economics from the Norwegian School of Business and Administration and he is a Norwegian citizen residing in Oslo, Norway. has over 25 years experience in the global pharmaceutical industry, predominantly spent with GlaxoSmithKline (GSK) based in the US and the UK working in a variety of functions (R&D, worldwide strategic marketing and licensing/business development). She played a key role in the success of GSK s global business development group and was responsible for structuring and delivering some of GSK s most innovative deals with the biotech sector over the past 15 years. Ms Clancy retired from GSK in 2008 but remains Chair of an external Board for its Respiratory Centre of Excellence for Drug Discovery (CEDD). She currently serves as a senior advisor at the US-based venture capital firm Frazier Healthcare Ventures and is presently a Non-executive Director at Silence Therapeutics PLC. Ms Clancy holds a BSc (hons) degree in Pharmacology. She is a British citizen and resides in London, UK. works as an independent advisor within corporate communication and public affairs. She was a member of the Norwegian Parliament from 1981 to 1997, which included a period as Minister for Trade and Shipping. Ms Kullmann Five was leader of the Norwegian Conservative Party from 1991 to From 1998 to 2002, she was Senior Vice President Corporate Communication and Public Affairs in Aker RGI, and holds several formal board appointments. She holds a Cand. Polit (Master) in Political Science from the University of Oslo. Ms Kullmann Five is a Norwegian citizen and resides in Bærum, Norway. The Board of Director s direct and indirect shareholdings in Clavis Pharma are detailed in note 18 to the Financial Statements for 2010.

21 About Clavis Pharma 21 Carl Christian Gilhuus-Moe is a Partner in NeoMed Management and has served on the Board of Clavis Pharma since the Company was founded in He was the President and CEO of Dynal AS a Norway based biotechnology firm from its formation in 1986 until Prior to this, he spent 15 years with Hafslund Nycomed AS, with his last role being Vice President and Head of the Diagnostics Division. He holds a Ph.D. in Biochemistry from the University of Oslo. Mr Gilhuus-Moe is a Norwegian citizen and resides in Bærum, Norway. Karol Sikora is Medical Director of Cancer Partners UK and simultaneously Scientific Director of Medical Solutions PLC, Britain s leading cancer diagnostic company. From 1985 to 1997, he was Clinical Director for Cancer Services at the Hammersmith Hospital, and at the same time Professor of Cancer Medicine at Imperial College, School of Medicine. Dr Sikora has been Chief of the WHO Cancer Program and Vice President of Global Clinical Research (Oncology) at Pharmacia Corp. He studied Medical Science and Biochemistry at Cambridge University, later taking a Ph.D. in Molecular Biology at Stanford University, California. Dr Sikora is a British citizen residing in Beaconsfield, UK. Hilde H. Steineger is Vice President Business Development at Pronova BioPharma ASA. Prior to this, she was a Senior Associate with NeoMed Management. Dr Steineger was employed with Nycomed Pharma in the area of clinical research and international marketing from 1999 to From 2001 to 2004, she held the position of Equity Analyst in Kreditkassen (now part of Nordea). From 2004 to 2006, she worked as an advisor, focusing on start-ups within the healthcare sector. She is a Board member of Algeta ASA and holds a M.Sc. and a Ph.D. in Medical Biochemistry from the University of Oslo. Dr Steineger is a Norwegian citizen and resides in Oslo, Norway.

22 22 About Clavis Pharma Management The Executive Management team of Clavis Pharma Olav Hellebø Ole Henrik Eriksen Jan Alfheim Athos Gianella- Borradori Chief Executive Officer, is an experienced pharmaceutical executive who has held senior positions in the pharmaceutical industry in Europe and the USA, most recently UCB, where he was Senior VP, UCB Pharma and President of Immunology Operations. In this position he built and led the global organization responsible for the successful registration and launch of Cimzia, UCB s new antibody drug. From 2003 to 2004 Mr Hellebø was Chief Operating Officer of Novartis UK and prior to that held a series of senior international roles at Schering Plough, the last as head of Schering Plough s Oncology Biotech Division in the USA. Mr Hellebø graduated in Business Studies from Hofstra University, New York and received an MBA from IESE, Barcelona. Chief Operating Officer, was the first CEO of Clavis Pharma when the Company was founded in August Prior to that, he had 18 years of experience as a scientist, Director, VP and CEO in the pharmaceutical and diagnostic imaging industry, including Nycomed Imaging (now part of GE Healthcare), Medinnova, NeoRad AS and Alertis Medical AS. Mr Eriksen holds a M.Sc. in Organic Chemistry from the Norwegian University of Science and Technology. Chief Business Officer, has more than 20 years of international experience relating to product and corporate development within the pharmaceutical, biotech and chemical industries. He has held the position of President of StemPath Inc., as well as that of Director of Business Development at Neurochem Inc. Before joining Neurochem, Mr Alfheim held senior management positions in Europe, including Project Director at Nycomed Imaging AS (now part of the GE Healthcare). Mr Alfheim holds an MBA from McGill University and a M.Sc. degree in Chemistry from Concordia University, Montreal. Chief Medical Officer, brings to Clavis 20 years of industry insight from a range of small and large pharmaceutical companies, always focused on translational research and on the clinical development of novel anti-cancer agents for patients with solid tumors and haematological malignancies. During this career, he has held managerial and senior clinical research and development roles at Novartis in Basel, Crucell in Leiden, Bavarian Nordic in München, Cyclacel in Dundee, Serono in Geneva and before joining Clavis Pharma in Merck Serono in Geneva and Darmstadt. Dr Gianella- Borradori received his medical degree from the University of Bern, Switzerland. He is board certified in Pediatric Hematology and Oncology and before joining the industry practised for several years at European and at US universities. The Executive Management team s direct and indirect shareholdings in Clavis Pharma are detailed in note 18 to the Financial Statements for 2010.

23 About Clavis Pharma 23 Gunnar Manum Chief Financial Officer, joined Clavis Pharma in April Prior to this, he was a senior advisor at Handelsbanken Capital Markets, Corporate Finance, for eight years. Mr Manum has long and wide-ranging experience from having held several managerial positions within finance and accounting with Stolt Sea Farm (now part of Marine Harvest) and PricewaterhouseCoopers, Australia. He holds an M.Com in Finance and Accounting from the University of New South Wales, Sydney. Tone Veiteberg VP Quality Assurance & Regulatory Affairs, has been with Clavis Pharma from its inception in August Before that she had 16 years experience in Medical and Regulatory Affairs in the pharmaceutical and medical device industry including the Norwegian Association of Pharmaceutical Manufacturers, Leo Pharmaceuticals and Glaxo (now part of GlaxoSmithKline). Ms Veiteberg holds a Cand. Pharm (Master) in Pharmacy from the University of Oslo.