Antibody Drug Conjugates Deep dive into new technologies and drug candidates (Post-ASCO Update) Research Analysts Jason Kantor (415)-249-7942 jason.kantor@credit-suisse.com Jeremiah Shepard (415)-249-7933 jeremiah.shepard@credit-suisse.com Ravi Mehrotra (212)-325-3487 ravi.mehrotra@credit-suisse.com Koon Ching (212)-325-6286 koon.ching@credit-suisse.com June 19, 2014 Lee Kalowski (212)-325-9683 lee.kalowski@credit-suisse.com Anuj Shah (212)-325-6931 anuj.shah@credit-suisse.com CREDIT SUISSE SECURITIES RESEARCH & ANALYTICS BEYOND INFORMATION Client-Driven Solutions, Insights and Access DISCLOSURE APPENDIX AT THE BACK OF THIS REPORT CONTAINS IMPORTANT DISCLOSURES, ANALYST CERTIFICATIONS, AND THE STATUS OF NON-US ANALYSTS. US Disclosure: Credit Suisse does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.
Updates post ASCO 2014: Updated Phase I data for IMGN853 and IMGN529 Still working out tox issues Phase II results for ROMULUS trial comparing Roche s Pina to Palo Both have solid efficacy in DLBCL and FL. Palo appears to be moving forward in FL. Both have significant neuropathy concerns Data for anti-cd19 ADCs SAR3419 (Phase II) and SGN-CD19A (Phase I) Both are active but have ocular toxicity. SGN-CD19A may have higher CR rate in more refractory patients. Unclear what Sanofi s plans are for SAR3419 First clinical data for ABT-414 Highly encouraging CR and 2 PRs in refractory glioblastoma. Ocular tox is an issue Phase I data for Roche s anti-napi2b ADC Very encouraging 41% ORR in ovarian cancer. Moved into randomized Phase II vs. Doxil Adcetris in 1 st line HL Impressive 91% ORR (83% CR) after only two doses of Adcetris in 1 st line prior to ABVD Other updates/new data for Roche s anti-steap1 ADC and anti-mesothelin ADC, Takeda s MLN0264 (anti-gcc) for GI malignancies, and PGNX s anti-psma ADC Sources: Company data, Credit Suisse research 2
Key Readouts for ADCs in 2014 Roche/IMGN: Kadcyla MARIANNE Phase III data in first line metastatic breast cancer (H2:14). Key to expansion into 1 st line; Combo data with Perjeta could define highest efficacy combination. SGEN: Adcetris AETHERA Phase III (Q4:14), and SGN-CD33A Phase I update likely at ASH (Dec 2014). Potential to expand market for Adcetris; could lead to longer treatment duration. Roche/SGEN: Data from multiple programs likely at ASH 2014 Sanofi/IMGN: Coltuximab Ravtansine (SAR3419) Phase II MYRALL data in ALL likely at ASH 2014 (Dec 2014). Will also be critical to see whether Sanofi moves this program forward in either DLBCL or ALL. IMGN: First IMGN289 clinical data at cancer meeting (H2:14), and additional updates possible for IMGN853 and IMGN529. Currently no clear winner in the pipeline. IMGN289 (anti-egfr) could become IMGN s next driver. Sources: Company data, Credit Suisse research 3
The Future of ADCs 1. Overview of antibody drug conjugates 2. Pipeline of ADCs in development 3. Addressing current challenges with new technologies 4. ADC innovators Who are the players? 5. Key players Roche, Seattle Genetics, ImmunoGen 6. Key ADCs in development (Updated) 4
ADC Overview A Three Part Technology Antibody, Drug, and Linker
Overview of ADCs ADCs can provide additional activity/efficacy over naked antibodies ADCs build on antibody therapeutics characteristics o o o o High specificity Long half-life Reduced immunogenicity with current antibody technology Well understood biological function ADCs have lower toxicity compared to naked drugs; enables use of higher potency drugs. ADCs have been clinically validated (Kadcyla, Adcetris). Most ADC programs are Phase I or early Phase II - potential for many more approved ADCs in next 3-5 years. Some ADCs have rescued failed antibodies (ie SGN-30, the mab in Adcetris). Sources: Company data, Credit Suisse research 6
ADCs: A Three Component System Three key components: Antibody Needs to be highly specific for tumor cells Targeting normal cells will lead to toxicity Needs to be internalized by tumor cells Drug Needs to be high potency Limited drug molecules get to the tumor cell so must be very active Linker Needs to be stable in plasma but released in target cells Multiple chemistries can be employed for this purpose. More potent drugs require more stable linkers Sources: Company data, Credit Suisse research 7
Current State-of-the-Art: Two Approved ADCs Adcetris Kadcyla Company Seattle Genetics Roche/ImmunoGen Target CD30 Her2 Indication r/r Hodgkin lymphoma & ALCL 2 nd line Her2+ metastatic breast cancer Potential expansion Toxin 1 st line HL and ALCL, r/r DLBCL, CTCL Monomethyl auristatin E (MMAE) 1 st line mbc, adjuvant BC, gastric cancer Mertansine (DM1) Drug class Tubulin inhibitor Tubulin inhibitor Linker Approximate # of drugs per antibody Cleavable valinecirtrulline linker Mostly 4 (0,2,4,6,8) Non-cleavable thioether linker ~3.5 average Sources: Company data, Credit Suisse research 8
Next Generation Innovations Looking to improve efficacy and safety Antibody Probody antibody prodrug format to enhance specificity at tumor sites Toxin DNA crosslinking toxins - more potent, different mechanism, and different potential toxicity/resistance profile; Examples: Pyrrolobenzodiazepine (PBD) dimer, DGN462 Linker Site specific conjugation multiple technologies allow for precise drug number and linker location Non-native amino acids modified antibodies allow for site specific linking; unique linker chemistry; potential for two different drugs loaded on one antibody Fleximers Large hydrophilic linker system; multi-drug binding sites; can significantly increase drug number Sources: Company data, Credit Suisse research 9
Pipeline of ADCs in Development A large number of programs advancing in development
Clinical Stage Antibody Drug Conjugates 37 ADCs in clinical development, including 2 marketed drugs Conjugate Company Antigen, Drug Indication Technology from Stage of Development Adcetris (Brentuximab vedotin, SGN-35) Seattle Genetics CD30, vcmmae Hodgkin's lymphoma, salcl Seattle Genetics Marketed Kadcyla (Ado-trastuzumab emtansine, T-DM1) Genentech Her2, DM1 Her2+ breast cancer ImmunoGen Marketed Inotuzumab ozogamicin (CMC-544) Pfizer CD22, CalichDMH ALL, DLBCL (Phase II) Pfizer Phase III Glembatumumab vedotin (CDX-011) Celldex GPNMB, vcmmae Triple negative breast cancer Seattle Genetics Phase II (pivotal) Coltuximab ravtansine (SAR3419) Sanofi Aventis CD19, DM4, dilsufide DLBCL, ALL ImmunoGen Phase II PSMA ADC Progenics PSMA, vcmmae Prostate cancer, GBM Seattle Genetics Phase II Pinatuzumab vedotin (DCDT2980S, RG7593) Genentech CD22, MMAE fnhl, DLBCL Seattle Genetics Phase II Polatuzumab vedotin (DCDS4501A, RG7596) Genentech CD79b, MMAE fnhl, DLBCL Seattle Genetics Phase II Labetuzumab-SN-38 (IMMU-130) Immunomedics CEACAM5, SN38 Colorectal cancer Immunomedics Phase II hrs7-sn-38 (IMMU-132) Immunomedics Trop-2/EGP-1, SN38 Epithelial cancers Immunomedics Phase II RG7599 (DNIB0600A) Genentech NaPi2b Ovarian, NSCLC Seattle Genetics Phase II BT-062 Biotest AG CD138, DM4, dilsufide Multiple myeloma, triple-neg BC ImmunoGen Phase I/II Milatuzumab -Dox Immunomedics CD74, doxorubicin Multiple myeloma, NHL, CLL Immunomedics Phase I/II ABT-414 AbbVie EGFRvIII Squamous cell cancer, glioblastoma Seattle Genetics Phase I/II SAR566658 Sanofi Aventis CA6, DM4, dilsufide Ovarian, breast ImmunoGen Phase I AGS-16C3F Astellas ENPP3, mcmmaf Renal cell cancer Seattle Genetics Phase I RG7450 (DST3086S) Genentech STEAP1, MMAE Prostate cancer Seattle Genetics Phase I RG7598 Genentech not disclosed (FcRL5?) Multiple myeloma Seattle Genetics Phase I RG7458 (DMUC5754A) Genentech MUC16, MMAE Ovarian, pancreatic Seattle Genetics Phase I RG7600 (DMOT4039A) Genentech Mesolthelin, MMAE Pancreatic, ovarian Seattle Genetics Phase I RG7636 Genentech ETBR Melanoma Seattle Genetics Phase I ASG-22ME Astellas/SGEN Nectin-4, MMAE Solid tumors Seattle Genetics Phase I BAY 94-9343 Bayer Mesothelin, DM4, dilsufide Ovarian, pancreatic ImmunoGen Phase I AMG 172 Amgen (Abgenix) CD27L Renal cell cancer ImmunoGen Phase I AMG 595 Amgen (Abgenix) EGFRvIII Glioma ImmunoGen Phase I IMGN529 ImmunoGen CD37, DM1 (non cleavable) B-cell lymphoma ImmunoGen Phase I IMGN853 ImmunoGen FOLR1, DM4, dilsufide Ovarian ImmunoGen Phase I MLN0264 Millennium Guanyl cyclase C, MMAE Gastric cancer Seattle Genetics Phase I SGN-CD19A Seattle Genetics CD19, mcmmaf B-cell lymphoma Seattle Genetics Phase I ASG-15ME Astellas/SGEN SLITRK6, MMAE Bladder, lung cancer Seattle Genetics Phase I SGN-CD33a Seattle Genetics CD33, PDBD AML Seattle Genetics Phase I IMGN289 ImmunoGen EGFR NSCLC, head and neck cancer ImmunoGen Phase I PF-06263507 Pfizer 5T4 (TPBG), MMAF Solid tumors Seattle Genetics Phase I SGN-LIV1A Seattle Genetics LIV-1, vcmmae Breast cancer Seattle Genetics Phase I HuMax-TF ADC (TF-011-vcMMAE) Genmab Tissue Factor, MMAE Solid and hematologic tumors Seattle Genetics Phase I AGS67E Astellas CD37, MMAE B-cell lymphoma Seattle Genetics Phase I RG7841 Genentech not disclosed Solid tumors Seattle Genetics Phase I Sources: Company data, Credit Suisse research 11
Main ADC Platforms Vast majority of ADCs in the clinic utilize SGEN or IMGN technology Sources: Company data, Credit Suisse research 12
Partnerships for ADCs SGEN and IMGN are the dominant technology platforms ADC Therapeutics Genmab SGEN Celldex Progenics IMGN Sanofi Mersana Endo MedImmune Millennium Biotest Sutro Biopharma Pfizer Oxford Biotherapeutics Roche * Bayer Novartis Amgen Eli Lilly Celgene AbbVie Daiichi Sankyo Cytomx Astellas GlaxoSmithKline *Roche has 1 marketed drug (Kadcyla) with IMGN, but appears to have selected SGEN s platform for further development (8 clinical programs. Sources: Company data, Credit Suisse research 13
SGEN and IMGN technologies SGEN and IMGN have a mix of partnered and proprietary programs in the clinic. SGEN Compounds in the Clinic IMGN Compounds in the Clinic 18 18 16 16 14 12 Genmab Millennium Astellas 14 12 10 10 8 6 4 2 0 Roche 50/50 dev. Proprietary AbbVie Progenics Celldex Roche Proprietary Phase I Phase II Marketed 8 6 4 2 0 Bayer Amgen Proprietary Sanofi Biotest Sanofi Roche Phase I Phase II Marketed Sources: Company data, Credit Suisse research 14
How Some of the Bigger Companies are Accessing ADCs Amgen: Its deal with IMGN came through its acquisition of Abgenix. Amgen has subsequently moved two ADC into the clinic using IMGN s technology. AstraZeneca: Bought Spirogen in 2013 and takes equity stake ADC Therapeutics. Builds on antibody expertise of Medimmune. First major move into ADC space. Astellas: Bought Agensys, which had a 50/50 co-development with SGEN. Subsequently expanded to multi-target license deal. Currently has 3 ADCs in the clinic. AbbVie: Total of three deals with SGEN starting prior to ABBV spin out. Initially a singletarget deal, expanded twice to multi-target deals. Total of $58M in upfronts. Pfizer: Wyeth developed the first approved ADC Mylotarg. Pfizer acquired Wyeth and still has proprietary development of ADCs. Roche: Technology deals with both SGEN and IMGN as well as significant internal research and development (proprietary format Thiomab failed in clinic). Kadcyla approved and 9 other ADCs in development. Sanofi: Aventis had a broad R&D collaboration with IMGN from 2003 to 2008. From that deal it gained its two clinical stage ADCs, which continue to advance. Sanofi subsequently took a license to another ADC target stemming from a separate 2006 agreement. Sources: Company data, Credit Suisse research 15
Addressing Current Challenges with New Technologies Focus on drugs and linkers
Increasing Potency Through Higher Drug : Antibody Ratio More drugs should make ADCs more potent, but there are problems Current ADCs have a range of drugs: Adcetris has mostly 4 per antibody (range 0-8) Kadcyla has ~3.5 on average per antibody Increased drugs/linkers can lead to: ADC instability Decreased half-life Aggregation during manufacturing Solution(s) Fleximers: Mersana linkers are large biodegradable polymers that can increase drug:antibody ratio many fold. More soluble drug/linkers may allow higher drug:antibody ratios Site specific conjugation allows attachment of a specific number of drugs. This may not always lead to more drug per antibody, but can avoid some of the problems associated with overloading antibodies Liabilities depend on physical properties of the drug and linker Sources: Company data, Credit Suisse research 17
Drug : Antibody Ratio Current State of Art IMGN - Kadcyla Conjugates to lysine Approximately 80-100 possible sites More than 1M possible combinations Average ratio is approximately 3.5 for Kadcyla SGEN - Adcetris Conjugates to cysteine by first breaking the disulfide (S-S) bonds between the heavy and light chains Maximum of 8 sites per antibody (4 disulfide bonds) Optimal ratio is ~2-4 drugs per antibody for Adcetris Mixtures vary in both drug : antibody ratio and site of conjugation Sources: Company data, Sutro presentation, Credit Suisse research 18
Drug : Antibody Ratio Possible Solutions Mersana s Fleximer SGEN More soluble drug/ linkers More soluble standard format Fleximer Polymer is highly water soluble (hydrophilic) Large number of drugs can be loaded on the polymer (even hydrophobic drugs) Polymer/drug conjugate can then be linked to the antibody New linker with PEG for increased drug loading Polymer/drug can be linked to other types of targeting agents (e.g. antibody fragments) Sources: Company data, Mersana presentation, AACR 2014 posters, Credit Suisse research 19
More Uniform ADCs Through Site Specific Conjugation Current ADCs are mixtures with varied drug numbers and conjugation sites Current ADCs have a range of drugs: Mixtures may include inactive variants or variants with undesirable PK or safety Methods to achieve optimal loading may leave some antibodies with no drug Some newer drugs (e.g. PBD dimers) may have physical properties that lead to aggregation if drug:antibody ratio is too high Solution(s): Genentech developed Thiomabs failed due to toxicity SGEN is using site specific conjugation for its PBD dimer conjugates (SGN-CD70A and SGN-CD33A) Sutro, Allozyne, and Ambrx introduce nonnative amino acids for site specific conjugation Other site specific approaches are being Redwood Biosciences and others Site specific conjugates may be theoretically more potent if undesirable conjugates add toxicity while desirable conjugates are more potent. This has yet to be proven in the clinic Sources: Company data, Sutro presentation, Credit Suisse research 20
Improving Safety and Efficacy Current ADCs have liabilities New drugs and linkers may improve profile Current challenges: Drug resistance can develop against the toxin (e.g. efflux pumps) Peripheral neuropathy is seen with some tubulin agents (e.g. Adcetris) Ocular toxicity has been seen with multiple ADCs using two different toxins (MMAF and DM4) Improvements in linkers and toxins are likely to enhance the safety of ADCs Solution(s): New drugs may be less sensitive to efflux pumps and / or combining two drugs with different mechanisms of action DNA targeting agents (ie PBD dimers) may not have peripheral neuropathy (likely something different) Ocular toxicity being addressed by steroid eye drops and alternative dosing strategies. Best solution is likely new toxins (i.e. not MMAF and DM4). Sources: Company data, Credit Suisse research 21
Improving Safety and Efficacy Ocular Toxicity Significant ocular toxicity with MMAF and DM4 conjugates Frequent at low grade Dose dependent Blurred vision range from 20-50% Som e exam ples: IMGN853 SAR3419 SGN-CD19a ABT-414 AGS-16M8F SAR566658 Generally reversible Attempts to mitigate with dosing changes and steroid prophylaxis Eye toxicity may raise bar for clinical activity to achieve good risk/benefit Variety of manifestations: Blurred vision Dry eye Keratopathy Keratitis Corneal deposits Foreign body sensation Photophobia Eye pain Sources: Company data, Credit Suisse research 22
Drug payloads beyond auristatins and maytansines Tubulysin T4 Pyrrolobenzodiazepine Duocarmycins Tubulysin believed to be 10-100X more potent than auristatins; still targets tubulin Ingenica has conjugated this payload to an ADC More potent payload could allow for greater efficacy with ADC targeting antigens with low expression Sources: Company data, Credit Suisse research DNA alkylating agent Induces double strand breaks that leads to cell death Several companies have licensed this drug payload and are using with its ADC technology DNA alkylating agent; active at picomolar range Binds to the DNA minor groove Synthon has developed fully synthetic derivatives, providing greater flexibility for manufacturing 23
ADC Innovators Who are the Players? (A-Z) Next generation technologies from new players and current leaders
Allozyne: Site-specific ADCs via non-natural amino acids AzAb technology uses engineered azide handles for conjugation Allozyne incorporates nonnatural azide amino acids into antibodies Regulates the drug/antibody ratio and location of the drug to the azide May improve ADC PK in vitro experiments demonstrate that the ADCs are stable at 37 degrees Celsius in human serum for at least 1 month Allozyne is a privately held company. Its most advanced ADC program is preclinical Sources: Company data, Credit Suisse research 25
Ambrx: Site-specific ADCs via non-natural amino acids Ambrx is a pioneer in employing nnaas Ambrx developed sets of trna/trna synthetase pairs in engineered cells lines to incorporate non-native amino acid into proteins (e.g. antibodies) Non-native amino acids can be used for site specific drug conjugations This technology is also being examined in other protein therapeutics Ambrx is a privately held company. Its most advanced ADC program is preclinical Sources: Company data, Credit Suisse research 26
CytomX Therapeutics Probody technology CytomX is a privately held company. Its most advanced ADC program is preclinical. ADCs are highly specific for their target, but some targets may also be found on normal tissue (e.g. skin, heart, etc.) leading to unwanted toxicity Probodies are modified antibodies that are unable to bind their target unless they are cleaved by proteases, which are often found in and around tumors ADC Probodies are activated at the site of the tumor, potentially reducing toxicity in other tissues CytomX and IMGN have a collaboration to share each others technology Sources: Company data, Credit Suisse research 27
ImmunoGen, Inc. Marketed drug Kadcyla uses IMGN technology 3 proprietary drugs in the clinic awaiting proof of efficacy (& safety) Two drug formats in the clinic (DM1 & DM4) New linkers block efflux pumps combat drug resistance (e.g. IMGN853) New DNA binding agents in development (IGN) Partnership with CytomX provides access to Probody technology Variety of drugs and linkers in the clinic Linker chemistry can thwart drug efflux pumps New DNA-binding toxins Charged linker improves solubility Sources: Company data, Credit Suisse research 28
Ingenica : Site-specific ADCs using natural cysteines Conjugation to natural cysteine (like SGEN) Novel linker binds both cysteines of a disulfide pair. Can achieve homogeneous linkage of 4 drugs per antibody (4 disulfide pairs per antibody) The covalent bonds between the light and heavy chain is maintained, which may enhance stability Alternative linkers can achieve 8 drugs per antibody Ingenica takes proven conjugation chemistry and improves it to make homogenous ADCs Working with multiple payloads Compatible with proven payloads (MMAE, MMAF) Working with proprietary tubulysin derivative Ingenica is a privately held company. Its most advanced ADC program is preclinical Sources: Company data, Credit Suisse research 29
Meditope Biosciences: Linking drug payload via keyhole Key discovery There is a pocket in the Fab portion of Erbitux which can specifically and non-covalently bind a peptide called a meditope Application A portion of the Erbitux antibody is grafted into any other antibody, providing a docking station for the meditope Meditopes with attached toxins can be sitespecifically bound to these modified antibodies. The attachment is non-covalent, site-specific, and has a fixed drug number. Non-covalent binding of drug/ linker payload to antibody in highly specific manner Meditope is a privately held company. We are unaware of any specified drug candidates. Sources: Company data, Credit Suisse research 30
Mersana Therapeutics: Fleximers Versatile Fleximer technology Fleximer technology can allow up to 20 drugs per linker Highly water soluble (hydrophilic) linker technology, Fleximer, allows for many drugs conjugated drug, increasing drug:antibody ratio Can use Fleximer technology to add payloads to other types of molecules Polymer/drug can be linked to other types of targeting agents (e.g. antibody fragments) Mersana is a privately held company. Its most advanced ADC program is preclinical Sources: Company data, Credit Suisse research 31
Redwood Bioscience: Site-specific conjugation SMARTag technology Redwood engineers antibodies to contain new cysteines The new cysteines are modified with an enzyme to remove the sulphur group and create an aldehyde tag that is amenable to specific chemistry to attach the drug payload Different variations with the technology are possible Incorporates a cysteine at a specific site to target conjugation Redwood is a privately held company. Sources: Company data, Credit Suisse research 32
Seattle Genetics Developing a deep ADC tool box Marketed proprietary ADC - Adcetris 6 wholly owned or co-developed drugs in the clinic 13 partners with 16 drugs in the clinic Three drug formats in the clinic (MMAE, MMAF, PBD) New linkers in development Improved soluble form of MMAF + Linker: Inclusion of PEG molecule as a side chain can improve ADC PK and potency New linkers with differential drug release Site specific conjugation with PBD payload Sources: Company data, Credit Suisse research 33
Sutro Biopharma: Site-specific ADCs Sutro is developing a cell-free system for protein synthesis Cell-free systems allow for substitution of non-native amino acids Non-native amino acids provide location for site specific conjugation and allow for specific conjugation of two different payloads Cell free systems may also provide for a cheap and efficient method to scan for an optimal conjugation site on a monoclonal antibody Cell-free production gives greater control for adding non-native amino acids Non-native amino acids allow for site specific conjugation of more than one toxin Sutro is a privately held company. Its most advanced ADC is preclinical Sources: Company data, Credit Suisse research 34
Synthon: SpaceLink linker technology Very potent DNA alkylator (duocarmycin) is not activated until it is released from ADC Proprietary linker chemistry Releases drug in a precursor format. Drug subsequently converted to active form. Unique mechanism may provide safety advantage Unique modification to alter the PK of the drug/ linker once it is released from the ADC Synthon is a privately held company. Its most advanced ADC is preclinical Sources: Company data, Credit Suisse research 35
Key Player Genentech/Roche
Genentech / Roche Leader in ADC Development Kadcyla approved for 2nd line Her2 positive metastatic breast cancer Phase III data in 1st line Her2 positive metastatic breast cancer in H2:14 Genentech was an early adopter of ADC technology signing deals with IMGN (2000) and SGEN (2002) and conducting significant internal development Potential multi-billion dollar franchise Biggest pipeline of ADCs in the industry 9 other ADCs in clinical development using SGEN s technology Roche Working appears to be working exclusively with SGEN technology now Drug Payloads Number of clinical program (stage) Key programs MMAE, MMAF 9 partnered programs with SGEN technology Anti-CD22 and Anti-CD79b for NHL, RG7458 (MUC16-MMAE) for ovarian to Ph II Sources: Company data, Credit Suisse research 37
Development Candidates Use SGEN Technology 9 ADCs in development Solid tumors: Pancreatic, ovarian, melanoma, lung, prostate Hem/ onc: NHL and multiple myeloma Most advanced has completed Phase II (anti-cd22 and anti-cd79b) Source: Roche Q1:14 earnings slide deck. 38
Kadcyla: A Key Part of Roche s Her2 Franchise New standard of care in relapsed Her2- positive metastatic breast cancer Key part of growing Her2 franchise at Roche First-line data expected in 2014 MARIANNE trial Expansion into adjuvant and neo-adjuvant Source: Roche Q1:14 earnings slide deck. 39
Kadcyla: Positive Phase III TH3RESA Trial Metastatic breast cancer failed 2 or more prior Her2 agents Clear win on PFS, OS, ORR, and safety PFS: HR 0.528, median 6.2m vs. 3.3m OS: HR 0.552, median not reached vs. 14.9m ORR: 31.3% vs. 8.6% Source: ECCO 2013 presentation. 40
Kadcyla: Positive Phase III EMILIA Data 2 nd line metastatic breast cancer Clear win on PFS, OS, ORR, DOR, and safety PFS: HR 0.65, median 9.6m vs. 6.4m OS: HR 0.621, median not reached vs. 23.3m ORR: 43.6% vs. 30.8%, DOR 12.6m vs. 6.5m Grade 3 AE: 40.8% vs. 57.0% Source: ASCO 2012 presentation. 41
Kadcyla: Robust Phase III Program in Earlier Lines MARIANNE is the next data readout Adjuvant trials are key to market expansion Sources: Company data, Credit Suisse research 42
Key Player Seattle Genetics
Seattle Genetics (SGEN) Adcetris approved for relapsed/refractory Hodgkin lymphoma and ALCL 23 clinical-stage programs total (1 marketed, 6 Phase II, 16 Phase I) SGEN was founded in 1998 on ADC technology spun out of Bristol Myers Squibb. This first generation ADC technology was improved at SGEN and the entire pipeline at SGEN now comprises internally developed technology 6 proprietary programs or 50/50 codevelopment in the clinic 3 toxins in the clinic (MMAE, MMAF, PBD dimer) 13 technology and development partners Genentech has 9 ADCs in the clinic with SGEN s technology SGEN technology partnerships Upfront Additional Partner Payment Milestones Royalties Terms Date Single target deals Genmab Undisclosed Undisclosed Mid-single digit Single target/opt-in rights Apr-11 Abbott $8M $200M Undisclosed Single target Mar-11 Pfizer $8M $200M Undisclosed Single target Jan-11 Genmab Undisclosed Undisclosed Mid-single digit Single target/opt-in rights Sep-10 Millennium $4M Undisclosed Mid-single digit Single target Mar-09 Daiichi Sankyo $4M Undisclosed Mid-single digit Single target Jul-08 Progenics $2M Undisclosed Undisclosed Single target Jun-05 MedImmune $2M / $1.5M Undisclosed Undisclosed Single/added one target Apr-05 Bayer $2M Undisclosed Undisclosed Single target Sep-04 Celldex $2M $28M Undisclosed Single target Jun-04 Multi-target deals AbbVie* $25M $225M/target mid- to high-single digit Multiple targets Jan-14 Abbott* $25M $220M/target mid- to high-single digit Multiple targets Oct-12 Oxford Biother. NA Undisclosed Undisclosed Multitarget/alternating options for sole Sep-11 development Genentech* $12M $900M Mid-single digit Multiple targets Aug-10 GlaxoSmithKline $12M $390M Mid-single digit Multiple targets Dec-09 Astellas* $12M $350M 50:50 profit/cost sharing Multiple targets/co-develop opt-in rights Nov-09 Sources: Company data, Credit Suisse research 44
SGEN Products and Pipeline Product Stage Cancer Indication Partner Structure Adcetris (brentuximab vedotin) Marketed Relapsed/refractory HL and ALCL Millennium/Takeda Regional partner Phase III Post-transplant Hodgkin lymphoma Phase III Relapsed CTCL (MF, pcalcl) Phase III 1st line HL and ALCL (with chemo) Phase II 1st line HL (monotherapy in elderly) Phase II CD30+ cancers CDX-011 (glembatumumab vedotin) Phase II Triple negative breast cancer Celldex Technology license (pivotal) RG7593 (anti-cd22; pinatuzumab Phase II fnhl, DLBCL Genentech Technology license vedotin) RG7596 (anti-cd79b; polatuzumab Phase II fnhl, DLBCL Genentech Technology license vedotin) PSMA ADC Phase II Prostate cancer Progenics Technology license RG7599 (anti-napi) Phase II Ovarian, NSCLC Genentech Technology license ABT-414 Phase I/II Gliobastoma AbbVie Technology license RG7600 Phase I Pancreatic, ovarian Genentech Technology license RG7636 (anti-etbr) Phase I Melanoma (metastatic or unresectable) Genentech Technology license RG7450 (anti-steap1) Phase I Prostate cancer Genentech Technology license RG7458 (anti-muc16) Phase I Ovarian Genentech Technology license RG7598 Phase I Multiple myeloma Genentech Technology license RG7841 Phase I Solid tumors Genentech Technology license AGS-16M8F Phase I Kidney cancer Astellas Technology license ASG-22ME Phase I Solid tumors Astellas 50/50 co-development MLN0264 Phase I Gastric cancer Millennium/Takeda Technology license SGN-CD19A Phase I Hematologic malignancies Proprietary ASG-15ME Phase I Bladder and lung cancer Astellas 50/50 co-development SGN-CD33A Phase I AML Proprietary HuMax-TF-ADC Phase I Not disclosed Genmab 50/50 option for SGEN AGS67E Phase I Not disclosed Astellas Technology license SGN-LIV1A Phase I Breat cancer Proprietary PF-06263507 (anti-5t4) Phase I Solid tumors Pfizer Technology license SGN-CD75a Preclinical Renal cell and NHL Proprietary Potential Adcetris sales MMAE MMAF PDBD Mechanism anti-tubulin anti-tubulin DNA crosslinker SGEN Adcetris SGN-CD19A SGN-CD33A candidates ASG-22ME ASG-15ME SGN-LIV1A Other CDX-011 AGS-16C3F candidates PSMA ADC PF-06263507 RG7593 (CD22) RG7458 (Muc16) Comments Clinical, regulatory, and commercial validation with Adcetris Side effects: Neutropenia and peripheral neuropathy Ocular toxicity seen with SGN-CD19A and one other MMAF ADC No clinical data available Sources: Company data, Credit Suisse research 45
Adcetris Consistent Efficacy and Safety in HL and ALCL 1 st Line ALCL Pivotal Phase II 1 st Line HL Pivotal Phase II Source: ASH 2010 46
Robust Activity in 1 st Line Hodgkin Lymphoma and ALCL Phase I 1 st line Hodgkin lymphoma w/ AVD chemo 1 st line elder HL - single agent 89% ORR (17/19) (12 CR, 5 PR) Phase I 1 st line ALCL w/ CHP chemo Phase II 1 st line Hodgkin lymphoma: Adcetris (2 cycles) Objective response N % Complete metabolic response 10 83% Partial metabolic response 1 8% Disease progression 1 8% Response by risk stratification Early favorable Early unfavorable Advanced No response 0 0 1 Partial matabolic response 0 1 0 Complete metabolic response 7 3 0 CR Rate 100% 75% 0% Source: ASH 2012, ASH 2013, ASCO 2014 47
Seattle Genetics: Redefining front-line therapy SGEN is enrolling trials in first-line HL and first-line MTCL Both trials add Adcetris to chemotherapy Both trials replace one component of multi-agent chemotherapy with Adcetris ECHELON-1 is ABVD vs Adcetris + AVD ECHELON-2 is CHOP vs Adcetris + CHP ECHELON-2 Phase III MTCL Front-line ECHELON-1 Phase III HL Front-line Source: ASH 2010 48
Seattle Genetics: Expanding in relapsed lymphoma SGEN is conducting trials in post-transplant maintenance HL (AETHERA) and relapsed CTCL (ALCANZA) Both trials test Adcetris monotherapy AETHERA is Adcetris vs placebo ALCANZA is Adcetris vs physicians choice ALCANZA Phase III Relapsed CTCL AETHERA Phase III Post-transplant maintenance AETHERA data expected in Q4:14 Sources: Company data, Credit Suisse research 49
Key Player ImmunoGen, Inc.
Ex-US Sales ImmunoGen, Inc. Kadcyla is approved for 2nd line Her2+ metastatic breast cancer IMGN gets 3-5% royalty from Kadcyla 3 proprietary ADCs in development 7 partnered ADCs in development Kadcyla royalty US Sales of T-DM1 ($M) 4.3% 500 1,000 1,500 2,000 2,500 3,000 500 3.4% 3.8% 4.1% 4.3% 4.4% 4.5% 1,000 3.8% 4.0% 4.2% 4.3% 4.4% 4.5% 1,500 4.1% 4.2% 4.3% 4.4% 4.5% 4.5% 2,000 4.3% 4.3% 4.4% 4.5% 4.5% 4.6% 2,500 4.4% 4.4% 4.5% 4.5% 4.6% 4.6% 3,000 4.5% 4.5% 4.5% 4.6% 4.6% 4.7% IMGN was founded in 1981 and has been a leader in the development of ADC technologies including the first ADC for solid tumors (Kadcyla) with partner Genentech Partner Scope Upfront Additional Milestones Royalties Date Eli Lily Multi-target $20M $200M mid-single to Dec. 2011 low-double digit Novartis Multi-target $45M $200M undisclosed Oct 2010 Bayer Single target $4M $170.5M undisclosed Oct 2008 Sanofi-aventis 2 Multi-target $2M $30M undisclosed Dec. 2006 Biotest AG Single target $1M $35.5M undisclosed Jul 2006 (IMGN has optin rights) (opt-in rights) Sanofi-aventis 1 Multi-target undisclose $21.5M undisclosed Jul 2003 d Abgenix Multi-target $1M $34M undisclosed Sept 2000 (Amgen) 3 Genentech (Roche) Multi-target $2M $44M tiered midsingle digit May 2000 1 executed three licenses for SAR3419 (CD19), SAR650984 (CD38), SAR566658 (DS6) 2 extended in August, 2011 for a $2M extension fee 3 executed two single-target licenses for AMG 595, AMG 172 in September, 2009 Sources: Company data, Credit Suisse research 51
IMGN Pipeline and Key Proprietary Programs Product Indication Stage Partner Kadcyla (T-DM 1) Her2+ mbc (prior Herceptin/Taxane) M arketed Roche 1st line Her2+ mbc Phase III Gastric Phase II/III Adjuvant BC Phase III SAR-3419 (anti-cd19-dm 4) DLBCL Phase II Sanofi-aventis BT-062 TAP M ultiple myeloma Phase I/II Biotest AG (IM GN has opt-in rights) SAR650984 (anti-cd38) Hematological malignancies Phase I Sanofi-aventis SAR-566658 (anti-ds6-dm 4) Breast, ovarian, lung Phase I Sanofi-aventis BAY 94-9343 (anti-mesothelin) Ovarian, pancreatic, mesothelioma Phase I Bayer HealthCare IM GN529 (anti-cd37-dm 1) Non-Hodgkin's lymphoma Phase I Proprietary IM GN853 (anti-folr1) Ovarian cancer Phase I Proprietary AM G 595 (anti-egfrviii) Glioma Phase I Amgen (Abgenix) AM G 172 Renal cell cancer Phase I Amgen (Abgenix) IM GN289 (anti-egfr) Solid tumors Phase I Proprietary Key proprietary programs Name IMGN529 IMGN853 IMGN289 Target CD37 Folate Receptor-alpha EGFR Drug payload DM1 DM4 DM1 Disease NHL Ovarian, endometrial Solid tumors Stage Phase I Phase I Phase I Timing Data at ASCO Data at ASCO Cancer meeting H2:14 Comments Neutropenia (including febrile neutropenia) seen at low doses. Steroid Dosing strategies to reduce EGFR validated target, but ocular toxicity and optimize key concern is skin tox anti-tumor activity -- prophylaxis has been added adjusted ideal body weight and dose escalation continues and weekly vs. every three week dosing Sources: Company data, Credit Suisse research IMGN Drug Payloads Number of clinical program (stage) Key programs DM1, DM4, DGN46 10 (1 marketed, 2 Phase II, 7 Phase I) IMGN289 (EGFR), IM853 (folate receptor) 52
Key ADCs in Development Most ADCs are in Phase I development, so clinical data is limited
Pinatuzumab vedotin (RG7593/DCDT2980S) Anti-CD22 MMAE Genentech program; technology from SGEN 92-patient Phase I in NHL/CLL complete Data at ASCO 2013 Phase II ROMULUS trial compared anti-cd22 and anti-cd79b ADCs head to head Data presented at ASCO 2014 Side effects appear similar to Adcetris Neutropenia and peripheral neuropathy Initial Phase I Results from ASH 2013 Responses at doses > 1.8 mg/ kg Source: ASH 2013 54
Polatuzumab vedotin (RG7596 / DCDS4501A) Anti-CD79B MMAE Genentech program; technology from SGEN 95-patient Phase I in NHL/CLL complete Data at ASCO 2013 Phase II ROMULUS trial compared anti-cd22 and anti-cd79b ADCs head to head Data presented at ASCO 2014 Side effects appear similar to Adcetris Neutropenia and peripheral neuropathy Initial Phase I Results from ASH 2013 Responses at doses > 1.8 mg/ kg Source: ASH 2013 55
First Head-to-Head Trial of Two ADCs Anti-CD22 and anti-cd79b competing internally at Genentech Head-to-head trial of two Phase II drugs Innovative trial designed to pick best candidate to advance to pivotal trials Cross-over helps assess value of developing both drugs for sequential therapy Source: ASCO 2014 56
Data from ROMULUS Head-to-Head Trial at ASCO Both drugs were highly active in FL and DLBCL R + Pinatuzumab (anti-cd22) responses better in DLBCL R + Polatuzumab (anti-cd79b) responses better in FL Plans to take anti-cd79b forward in FL Source: ASCO 2014 57
Data from ROMULUS Head-to-Head Trial at ASCO Toxicity profile suggests peripheral neuropathy may limit duration of therapy Peripheral neuropathy was most common reason for discontinuation Treatment discontinuation for AEs was 31-38% for DLBCL and 60-71% for FL Peripheral neuropathy was the most common reason for discontinuation (43-60% of FL) Not all the peripheral neuropathy was reversed 25-39% had ongoing neuropathy at study entry, so these results are difficult to interpret Source: ASCO 2014 58
Coltuximab Ravtansine (SAR3419) Anti-CD19 DM4 Sanofi licensed drug from IMGN Phase II STARLYTE trial: 55 r/r DLBCL patients Data at ASCO 2014 ORR of 38-44% in r/r DLBCL Few Grade 3&4 AEs Manageable ocular events Grade 1&2 Duration of response ASH 2014 STARLYTE ORR, ASCO 2014 Treatment Emergent AE s ASH 2014 Source: ASCO 2014 59
SGN-CD19A in DLBCL & MCL Anti-CD19 MMAF Target on all B-cells Ongoing Phase I in NHL (DLBCL and MCL) Initial Phase I data: ORR 30% (11/37), CR 16% (6/37) Dose expansion ongoing at 3, 4, and 5 mg/kg Prophylactic steroid eye drops added to mitigate ocular toxicity awaiting update Initial efficacy reported at ASCO High single-agent CR rate Ocular toxicity is an issue: question will be risk/ benefit Source: ASCO 2014 60
SGN-CD19A in ALL & Lymphomas Phase I in ALL showed proof of Dose-dependent efficacy in Phase I efficacy: 3 CR/CRp Ocular toxicity emerged as a safety concern; protocol changed to mandate steroid eye drop prophylaxis Data from DLBCL Phase I expected at ASCO. ALL poster stated that multiple CRs were seen in DLBCL. Ocular toxicity is an issue Source: ASH 2013 61
RG7599 (DNIB06004A) Anti-NaPi2b MMAE Genentech program; technology from SGEN Target highly expressed on ovarian cancer NSCLC, and papillary thyroid cancer 49-patient Phase I in ovarian and lung cancer presented at ASCO 2014 Roche advancing development Ongoing trials Phase Ia current trial enrolling NSCLC patients with fewer prior therapies Phase Ib Platinum-sensitive ovarian cancer in combination with carboplatin +/- Avastin Phase II randomized trial vs. Doxil in platinum resistant ovarian cancer Best responses seen in ovarian; correlates to NaPi2b expression Peripheral neuropathy is mostly grade 1 & 2 Source: ASCO 2014 62
Data from Phase I with anti-napi2b ADC (DNIB06004A) Time on study roughly correlates with IHC 41% ORR in ovarian cancer with IHC 2 / 3+ (7/ 17) 0% in IHC 0 (0/ 1) 10% ORR in NSCLC with IHC 2 / 3+ (2/ 21) 0% in IHC 0 (0/ 5) Very encouraging single agent activity in ovarian cancer prompted Phase II vs. Doxil Activity not ideal, testing in earlier lines of NSCLC in hopes of achieving higher response rate Source: ASCO 2014 63
ABT-414: Anti-EGFR ADC Antibody to activated EGFR or mutant EGFRvIII linked to MMAF (EGFR activated in many glioblastomas) High antitumor activity in preclinical models with either wild type EGFR or EGFRvIII Drug dosed in combination w/ temozolomide (TMZ) Animal models suggested synergy with temozolomide and radiation therapy Study design DLTs- 1.25 mg/ kg dose being evaluated Status of evaluable patients Source: ASCO 2014 64
ABT-414 + Temozolomide in Glioblastoma Phase I Single Arm Study Data presented at ASCO Promising Activity Demonstrated in Early Study 1 CR and 3 PRs out of 15 patients All responses in pts w/ TMZ refractory disease hard to treat patient population Ocular toxicity an issue for this ADC too Source: ASCO 2014 65
PSMA ADC Progenics ADC for metastatic castration-resistant prostate cancer Anti-PSMA MMAE; Technology from SGEN Updated Phase II data in taxane-refractory metastatic CRPC presented at ASCO 2014 Ongoing clinical work in chemotherapy naïve CRPC patients PGNX is co-developing a PSMA imaging agent Phase II PSA response rates and CTC results for taxane experienced patients Phase II RECIST response rates updated at 2014 ASCO Source: ASCO 2014 66
IMGN853: Anti-Folate Receptor Phase I ongoing to optimize safety and efficacy Anti-FRα DM4; proprietary ImmunoGen drug Folate receptor is up regulated on a large number of solid tumors including ovarian, lung, and breast Efforts ongoing to optimize dosing strategy to increase efficacy and decrease ocular toxicity Clinical benefit enriched in ovarian cancer above threshold Source: ASCO 2014 67
IMGN853: Anti-Folate Receptor Changed mg/kg dosing from total body weight (TBW) to adjusted ideal body weight (AIBW) to lower variability in drug levels and reduce toxicity Ocular tox associated with high early exposure Dose limited by ocular toxicity- reduced w/ AIBW Ocular AEs reported w/ TBW dosing Ocular AEs reported w/ AIBW dosing Ocular toxicity issue not yet solved May require weekly dosing to get low early levels to reduce tox and higher sustained levels for better efficacy Source: ASCO 2014 68
IMGN289: Anti-EGFR ADC Awaiting key Phase I data Targets EGFR like Erbitux and Vectibix Designed to lack skin toxicity could be key differentiator Clear clinical path if safe and effective in Phase I Expansion cohorts to test tumors known to be sensitive to EGFR antibodies Preclinical data supports safety difference Antibody selected for lack of skin toxicity Ongoing Phase I dose escalation Source: ASCO 2014 69
IMGN529: Anti-CD37 ADC Optimizing safety and efficacy CD37 is found on B-cell NHL (similar to CD20 target of Rituxan) Antibody alone has anti-cancer activity similar to Rituxan in vitro ADC format increases potency further 2 PRs observed in ongoing Phase I Neutropenia is main toxicity Evidence of activity at low doses IMGN reported 2 PRs out of 28 patients (7%), both at low doses (0.2 and 0.4 mg/kg). DLBCL patient w/ 3 prior treatments, PR at cycle 3. Stopped after 4 cycles. Transformed FL w/ 3 prior treatments. PR at cycle 3, but progressed after cycle 5 Initial Phase I dose escalation With peri-infusional steroids DLT is early onset neutropenia, which IMGN believes to be caused by cytokine release. Peri-infusional steroids added to protocol Unclear how high drug can be dosed. Source: ASCO 2014 70
MLN0264: Anti-Guanylyl cyclase C (GCC) ADC Anti-GCC MMAE; technology from SGEN GCC found on intestinal epithelial tumor cells Phase I ongoing Study design Preliminary response indicates antitumor activity Neutropenia is the DLT; MTD is 1.8 mg/kg Neuropathy not reported in >10% of patients 28 pts evaluable for response, 1 PR (gastric cancer at 1.8mg/kg), SD in 13 pts, including 3 patients who received 4 or more cycles. Modest response rate but still early DLT at 1.8mg/ kg- Grade 4 neutropenia Source: ASCO 2014 71
Inotuzumab ozogamicin (CMC-544) Phase I trial of IO in r/ r ALL Anti-CD22 ADC; proprietary technology CD22 is a B-cell marker. Target indications are NHL and ALL Phase III of CMC-544 + Rituxan in relapsed DLBCL stopped early for futility Phase III ongoing in relapsed/refractory ALL Updated data in NHL and ALL presented at ASCO Not included in slide deck Source: Cancer; 2013 72
Glembatumumab vedotin (CDX-011) EMERGE Phase II Data Pivotal Phase II METRIC Study Anti-GPNMB ADC; Technology from SGEN Pivotal METRIC trial in triple-negative breast cancer initiated in Dec. 2013 Phase II in melanoma (66 pt) and squamous cell lung cancer (55 pt) planned Source: EMERGE Update 2013 SABCS 73
IMMU-132 & IMMU-130: SN38 Conjugates IMMU-132 Anti-TROP-2; proprietary SN38 conjugate Phase I/II in a variety of solid tumors Phase II ongoing IMMU-130 Anti-CEACAM5; proprietary SN38 conjugate PR and tumor shrinkage seen in Phase I Phase II ongoing in relapsed metastatic colorectal cancer IMMU-132 Phase I/ II anti-tumor activity IMMU-130 Phase I data Source: ASCO 2014 74
SAR566658: Anti-CA6 ADC Signals of activity in Phase I Ocular toxicity seen as with other DM4 ADCs Phase I continues for SAR566658 Phase I is reported to be 150 patients, so we expect Sanofi will test across different dosing strategies and potential expansion cohorts Target tumor type for further studies not determined Ocular toxicity is a dose limiting concern Source: AACR-EORTC 2013 75
RG7450 (DSTP3086S) Anti-STEAP1 MMAE Genentech program; technology from SGEN 61-patient Phase I ongoing in prostate cancer; Interim data presented on 60 patients at ASCO 2014 Recommended Ph II dose (2.4 mg/kg every 3 wks) Time on Study- dose reductions indicated by color change 22% (10/45) pts dosed at >2 mg/kg had a PSA decline 50% 8% (2/26) RECIST evaluable pts (>2mg/kg) had PRs (all at 2.8mg/kg) Concern is that giving up higher efficacy (at 2.8 mg/kg) due to toxicity concern and going with lower dose (at 2.4 mg/kg) Best response by cohort Source: ASCO 2014 76
Indatuximab Ravtansine (BT062) Anti-CD138 DM4 Biotest drug; technology from IMGN Currently in 49-patient Phase I/II Trial completion expected in H1:15 Combination trial in multiple myeloma with Revlimid/ dexamethasone ASH 2013 ORR 75% in Len/ Dex refractory pts ORR 89% at MTD Source: Company data, Credit Suisse research 77
Companies Mentioned (Price as of 19-Jun-2014) AbbVie Inc. (ABBV.N, $54.24) Amgen Inc. (AMGN.OQ, $117.59) Bayer (BAYGn.DE, 103.45) Celgene Corp. (CELG.OQ, $166.34) Celldex (CLDX.OQ, $16.76) Daiichi Sankyo (4568.T, 1,830) Eli Lilly & Co. (LLY.N, $59.77) Endo Health Solutions (ENDP.OQ, $67.81) GENMAB (GEN.CO, Dkr227.1) ImmunoGen, Inc. (IMGN.OQ, $12.95) Immunomedics (IMMU.OQ, $3.67) Novartis (NOVN.VX, SFr81.2) Pfizer (PFE.N, $29.54) Progenics Pharm (PGNX.OQ, $4.35) Roche (ROG.VX, SFr266.4) Sanofi (SASY.PA, 79.54) Seattle Genetics (SGEN.OQ, $40.81) Takeda Pharmaceutical (4502.T, 4,876) Important Global Disclosures Disclosure Appendix I, Jason Kantor, PhD, certify that (1) the views expressed in this report accurately reflect my personal views about all of the subject companies and securities and (2) no part of my compensation was, is or will be directly or indirectly related to the specific recommendations or views expressed in this report. The analyst(s) responsible for preparing this research report received Compensation that is based upon various factors including Credit Suisse's total revenues, a portion of which are generated by Credit Suisse's investment banking activities As of December 10, 2012 Analysts stock rating are defined as follows: Outperform (O) : The stock s total return is expected to outperform the relevant benchmark*over the next 12 months. Neutral (N) : The stock s total return is expected to be in line with the relevant benchmark* over the next 12 months. Underperform (U) : The stock s total return is expected to underperform the relevant benchmark* over the next 12 months. *Relevant benchmark by region: As of 10th December 2012, Japanese ratings are based on a stock s total return relative to the analyst's coverage universe which consists of all companies covered by the analyst within the relevant sector, with Outperforms representing the most attractive, Neutrals the less attractive, and Underperforms the least attractive investment opportunities. As of 2nd October 2012, U.S. and Canadian as well as European ra tings are based on a stock s total return relative to the analyst's coverage universe which consists of all companies covered by the analyst within the relevant sector, with Outperforms repr esenting the most attractive, Neutrals the less attractive, and Underperforms the least attractive investment opportunities. For La tin American and non-japan Asia stocks, ratings are based on a stock s total return relative to the average total return of the relevant country or regional benchmark; prior to 2nd October 2012 U.S. and Canadian ratings were based on (1) a stock s absolute total return potential to its current share price and (2) the relative attractiveness of a stock s total return potential wit hin an analyst s coverage universe. For Australian and New Zealand stocks, 12-month rolling yield is incorporated in the absolute total return calculation and a 15% and a 7.5% threshold replace the 10-15% level in the Outperform and Underperform stock rating definitions, respectively. The 15% and 7.5% thresholds replace the +10-15% and - 10-15% levels in the Neutral stock rating definition, respectively. Prior to 10th December 2012, Japanese ratings were based on a stock s total return relative to the average total return of the relevant country or regional benchmark. Restricted (R) : In certain circumstances, Credit Suisse policy and/or applicable law and regulations preclude certain types of communications, including an investment recommendation, during the course of Credit Suisse's engagement in an investment banking transaction and in certain other circumstances. Volatility Indicator [V] : A stock is defined as volatile if the stock price has moved up or down by 20% or more in a month in at least 8 of the past 24 months or the analyst expects significant volatility going forward. Analysts sector weightings are distinct from analysts stock ratings and are based on the analyst s expectations for the fundamentals and/or valuation of the sector* relative to the group s historic fundamentals and/or valuation: Overweight : The analyst s expectation for the sector s fundamentals and/or valuation is favorable over the next 12 months. Market Weight : The analyst s expectation for the sector s fundamentals and/or valuation is neutral over the next 12 months. Underweight : The analyst s expectation for the sector s fundamentals and/or valuation is cautious over the next 12 months. *An analyst s coverage sector consists of all companies covered by the analyst within the relevant sector. An analyst may cov er multiple sectors. Credit Suisse's distribution of stock ratings (and banking clients) is: Global Ratings Distribution Rating Versus universe (%) Of which banking clients (%) Outperform/Buy* 44% (54% banking clients) Neutral/Hold* 40% (49% banking clients) Underperform/Sell* 13% (46% banking clients) Restricted 3% *For purposes of the NYSE and NASD ratings distribution disclosure requirements, our stock ratings of Outperform, Neutral, an d Underperform most closely correspond to Buy, Hold, and Sell, respectively; however, the meanings are not the same, as our stock ratings are determined on a relative basis. (Please refer to def initions above.) An investor's decision to buy or sell a security should be based on investment objectives, current holdings, and o ther individual factors. Credit Suisse does not provide any tax advice. Any statement herein regarding any US federal tax is not intended or written to be used, and cannot be used, by any taxpayer for the purposes of avoiding any penalties. See the Companies Mentioned section for full company names The subject company (ENDP.OQ, ROG.VX, IMGN.OQ, AMGN.OQ, BAYGn.DE, LLY.N, 4568.T, PFE.N, CELG.OQ, NOVN.VX, SGEN.OQ, ABBV.N, 4502.T) currently is, or was during the 12-month period preceding the date of distribution of this report, a client of Credit Suisse. Credit Suisse provided investment banking services to the subject company (ENDP.OQ, AMGN.OQ, BAYGn.DE, LLY.N, PFE.N, CELG.OQ, NOVN.VX) within the past 12 months. Credit Suisse provided non-investment banking services to the subject company (ROG.VX, IMGN.OQ, AMGN.OQ, BAYGn.DE, LLY.N, 4568.T, PFE.N, CELG.OQ, NOVN.VX, 4502.T) within the past 12 months Credit Suisse has managed or co-managed a public offering of securities for the subject company (AMGN.OQ, BAYGn.DE, PFE.N, CELG.OQ, NOVN.VX) within the past 12 months. Credit Suisse has received investment banking related compensation from the subject company (ENDP.OQ, AMGN.OQ, BAYGn.DE, LLY.N, PFE.N, CELG.OQ, NOVN.VX) within the past 12 months Credit Suisse expects to receive or intends to seek investment banking related compensation from the subject company (ENDP.OQ, IMGN.OQ, AMGN.OQ, BAYGn.DE, LLY.N, PFE.N, CELG.OQ, NOVN.VX, SGEN.OQ, ABBV.N, 4502.T) within the next 3 months. Credit Suisse has received compensation for products and services other than investment banking services from the subject company (ROG.VX, IMGN.OQ, AMGN.OQ, BAYGn.DE, LLY.N, 4568.T, PFE.N, CELG.OQ, NOVN.VX, 4502.T) within the past 12 months As of the date of this report, Credit Suisse makes a market in the following subject companies (ENDP.OQ, IMGN.OQ, AMGN.OQ, LLY.N, PFE.N, CELG.OQ, SGEN.OQ, ABBV.N, 4502.T). As of the end of the preceding month, Credit Suisse beneficially own 1% or more of a class of common equity securities of (NOVN.VX). As of the date of this report, an analyst involved in the preparation of this report has the following material conflict of interest with the subject company (PFE.N). As of the date of this report, an analyst involved in the preparation of this report, Vamil Divan, has following material conflicts of interest with the subject company. The analyst or a member of the analyst's household has a long position in the common stock Pfizer (PFE.N). A member of the analyst's household is an employee of Pfizer (PFE.N). As of the date of this report, an analyst involved in the preparation of this report has the following material conflict of interest with the subject company (PFE.N). As of the date of this report, an analyst involved in the preparation of this report, Ronak Shah, has the following material conflict of interest with the subject company. The analyst has a long position in the common stock Pfizer (PFE.N). For other important disclosures concerning companies featured in this report, including price charts, please visit the website at https://rave.creditsuisse.com/disclosures or call +1 (877) 291-2683. Important Regional Disclosures Singapore recipients should contact Credit Suisse AG, Singapore Branch for any matters arising from this research report. The analyst(s) involved in the preparation of this report have not visited the material operations of the subject company (ENDP.OQ, ROG.VX, IMGN.OQ, AMGN.OQ, BAYGn.DE, LLY.N, 4568.T, PFE.N, PFE.N, PFE.N, CELG.OQ, NOVN.VX, SGEN.OQ, ABBV.N, 4502.T, SASY.PA) within the past 12 months Restrictions on certain Canadian securities are indicated by the following abbreviations: NVS--Non-Voting shares; RVS--Restricted Voting Shares; SVS- -Subordinate Voting Shares. Individuals receiving this report from a Canadian investment dealer that is not affiliated with Credit Suisse should be advised that this report may not contain regulatory disclosures the non-affiliated Canadian investment dealer would be required to make if this were its own report. For Credit Suisse Securities (Canada), Inc.'s policies and procedures regarding the dissemination of equity research, please visit http://www.csfb.com/legal_terms/canada_research_policy.shtml. The following disclosed European company/ies have estimates that comply with IFRS: (SASY.PA). Credit Suisse has acted as lead manager or syndicate member in a public offering of securities for the subject company (AMGN.OQ, BAYGn.DE, PFE.N, CELG.OQ, NOVN.VX) within the past 3 years. As of the date of this report, Credit Suisse acts as a market maker or liquidity provider in the equities securities that are the subject of this report. Principal is not guaranteed in the case of equities because equity prices are variable. Commission is the commission rate or the amount agreed with a customer when setting up an account or at any time after that. For Credit Suisse disclosure information on other companies mentioned in this report, please visit the website at https://rave.creditsuisse.com/disclosures or call +1 (877) 291-2683. Credit Suisse s policy is to update research reports as it deems appropriate, based on developments with the subject company, the sector or the market that may have a material impact on the research views or opinions stated herein. Credit Suisse's policy is only to publish investment research that is impartial, independent, clear, fair and not misleading. For more detail please refer to Credit Suisse's Policies for Managing Conflicts of Interest in connection with Investment Research: http://www.csfb.com/research and analytics/disclaimer/managing_conflicts_disclaimer.html