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Product Overview

Brief Concept

EXHALER Concept and Overview

EXHALER uses a new drug delivery device to consistently and reliably deliver a well-understood topical steroid (fluticasone) deeper and more broadly into a patient’s nasal passages so the medication can reach sites with chronic inflammation

How does it work? ▪ EXHALER uses a patient’s exhaled breath to deliver a fine

mist deeply and broadly in the nasal cavity

– When exhaling into this device, the soft palate automatically elevates and seals off the nasal cavity from the throat and lungs, this is similar to blowing up a balloon, where air does not escape out of the nose

– Exhaled air with drug then penetrates deeply into the nasal cavity, deposits drug, and then exits around the nasal septum and out the opposite nostril (because the throat is sealed off)

– This mechanism has been shown to better deposit drug deeply in the regions of the nasal cavity affected by chronic inflammation, including where the sinuses drain (the ostiomeatal complex)

NosePiece

Flexible Mouthpiece

SprayPump

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EXHALER Overview

EXHALER, a breakthrough nasal drug delivery system, is currently in late stage clinical development in the U.S. for treatment of CRS with nasal polyps

EXHALER is expected to have applications in a variety of chronic nasal inflammatory diseases that would benefit from topical steroid deposition broadly and deeply in the nasal cavity

Ph3 clinical program completed for the U.S. for CRS with nasal polyps (>1,600 subjects), New Drug Application submission expected in 2016

─ Two positive pivotal 6-month double blind trials (320 patients each) in CRScNP

Outcomes included: Core symptoms of CRS, Lund-Mackay, Sinonasal Outcomes-22, Polyp Grade, Surgical Eligibility, and Patient Global Impression of Change, Sleep, QoL, etc.

~90% of patients had previously used intranasal steroids, ~30% had previous surgery

─ Positive data from both a one year (n=240) and 3-month (n=705) open label trial evaluating safety and efficacy in CRSsNP (84%) and CRScNP (16%); ~30% had prior surgery, ~90% had previously used intranasal steroids

Additional registration trials, in CRS (without nasal polyps) or another indication, for countries other than the U.S. are planned to start in 2016

─ For example, would become first and only drug worldwide to be approved for Chronic Sinusitis or for Recurrent Sinusitis

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GOALS For Interview

Clarion Healthcare, a consulting firm, is conducting research to evaluate the potential of the EXHALER outside the U.S.

Key objectives for our discussion: Understand your view on patient types and clinical situations where

EXHALER is likely to be most desirable (offer significant clinical benefit) What target patient population(s) or clinical setting is likely to result in an

evaluation by relevant reimbursement/access authorities in your country to permit product availability to doctors and patients

As you read, please consider: Where in the treatment flow and in which patient subpopulation(s) would the

EXHALER provide the most value relative to current therapies? What evidence would best support favorable pricing & reimbursement? How should clinical studies be designed to achieve these goals?

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Traditional Intranasal Corticosteroid Sprays

■ Only half (or less) of a drug dose is deposited beyond the nasal valve

■ Of the fraction of drug that gets past the nasal valve, much is swallowed – resulting in gastrointestinal delivery

■ Up to 90% of the emitted dose is deposited beyond the nasal valve and into the posterior and superior nasal cavity

■ Broad/deep deposition results in significant improvement in symptoms, including for patients previously using standard nasal sprays

‘EXHALER’ Spray

Nasal Valve

Location of Sinus Ostia

Location of Sinus Ostia

Nasal Valve

Comparison of Nasal Deposition Patterns

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Indication

Efficacy measures

Safety/ Tolerability

Description

EXHALER Profile: Chronic Rhinosinusitis

Improvement of symptoms▪ In a trial where ~90% of patients had used one or more of the currently available nasal steroid sprays before using EXHALER, and 25-

30% had had prior surgery: – Patients treated with EXHALER showed significant improvement in a spectrum of nasal symptoms as measured by the Sino-

nasal Outcome Test (SNOT-22), which decreased by an average of 20 points– After 12 months, half of patients reported SNOT-22 in range of healthy individuals– >85% of patients indicated that they were overall improved on EXHALER (with >65% reporting “much improved” or “very much

improved”) as assessed by Patient Global Impression of Change (PGIC) score– >70% of patients reported a significant improvement in nasal blockage with use of EXHALER– There was significant reduction in sinus mucosal thickening in the effected sinuses, as measured by CT scan– There was almost complete elimination of nasal edema (swelling) over 24 weeks, with Lund and McKay Endoscopic Score

decreasing from 3.7 to 0.7 (4 = gross edema in both nostrils; 0=no edema in either nostril)– >60% of patients reported significant reduction in sinus pain and pressure– >80% of patients reported progressively improved ability to breathe through the nose over 24 weeks

Reduction in frequency of episodic exacerbation of symptoms requiring escalation of medical therapy▪ In 4 clinical trials with EXHALER, the number of exacerbations (“flares”) requiring treatment with antibiotics and/or oral steroids is low

Improvement in sleep: In patients who had previously used currently available nasal sprays, 50% of patients who were reporting moderate to severe sleep disturbances reported improved sleep with EXHALER

Improvement in sense of smell: In patients who had previously used currently available nasal sprays, 50% of patients had significant improvement in sense of smell at 12 weeks with EXHALER

▪ Adverse event and tolerability profile is comparable to currently available intranasal steroids ▪ 69% of patients in a large trial indicate less drip down the back of the throat and 62% indicate less drip out of the front of the nose▪ The active ingredient of EXHALER does not inappropriately deposit into the lungs

Hypothetical description for market research testing only

▪ 200 to 400µg of fluticasone delivered twice daily in a novel, easy-to-use nasal delivery device▪ The EXHALER device produces more widespread, and especially higher and more posterior, drug delivery into the nasal cavity▪ Product is packaged in consumer friendly design and disposed of after each month of use

▪ Indicated for the treatment of chronic rhinosinusitis in patients 18 years of age and older

Reduction in need for surgical procedures including FESS▪ >75% of patients who qualified for surgery at the start of therapy no longer qualified for surgery after 24 weeks of treatment with

EXHALER primarily due to improvement of symptoms (and reduction or elimination of polyps in patients with polyps)▪ ≥77% of patients eligible for surgery at baseline are no longer eligible at 12 months

Reduction in polyp size, elimination of polyps▪ >60% of patients experienced a reduction in endoscopically assessed polyp size after 16 weeks▪ ~30% of patients were found to have complete elimination of polyps in at least one nostril on endoscopic examination at week 24▪ >50% of patients were found to have complete elimination of polyps in at least one nostril on endoscopic examination at 12 months

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MRI Images from Phase II Study in CRS without NP (n=20)

Hansen FS, Djupesland PG, Fokkens WJ. Rhinology, Volume 48, 292-299, 2010

Before After

Significant Improvement from Baseline in Mucosal Thickening in Sinuses

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CRS w Nasal Polyps

CRS w/o Nasal Polyps

Intensive Medical Therapy Population*Bauley, et al. 2014

EXHALERPopulationStudy 3204 (OL) (n=701)

Sinonasal Outcome Test-22

■PRE-treatment Score

■POST-treatment Score

Change in Score

42.8

25.6

17.2

■PRE-treatment Score

■POST-treatment Score

Change in Score

43.8

18.9

24.5

43.2

20.3

23.0

Surgical PopulationHopkins et al. 2009 (n=2,077)

■PRE-operative Score

■POST-operative Score

Change in Score

40.8

23.1

17.7

43.931.3

12.6

with / without NP

*Intensive Medical Therapy consisted of oral prednisone for 3 weeks, topical steroids in spray or irrigation form, and saline irrigation. If indicated, amoxicilin/clavulanic acid was prescribed for 20 days

Relative Effect Sizes – Various Modalities Across Studies

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Overall reaction to the EXHALER

Current treatment of CRS with focus on treatment needs

Where in the treatment flow and to which subpopulation(s) would it provide meaningful value to support product access (and where would it provide the most value) relative to current therapies?

− Examples: INS refractory, to prevent surgery, multiple flares w/comorbidities, CRS without polyps, CRS with polyps…

Given the patient population(s) of interest, how do you anticipate pricing & reimbursement agencies to evaluate this product?

What evidence would best support favorable pricing & reimbursement in your country?

− Particular endpoints, pharmacoeconomic studies, head to head trials, specific patient subsets...

What would be the optimal therapeutic indication you would like to see for regulatory approval of the EXHALER, and why?

Interview Outline