Contents:

CHAPTER 1 EXECUTIVE SUMMARY 4 Scope 4 Insight into the DNA/RNA market in 2004 5 The DNA/RNA market is forecast to generate $1.2bn by 2010, using a riskadjusted market forecast, of which 45% is set to be generated by Pfizer/Eyetech’s ophthalmic aptamer Macugen (pegaptanib). This product is set drive the overall growth of the market, and it represents the optimal business development and innovation profile. 6 Macugen’s strong revenue-generating potential means that the ophthalmology franchise and the aptamer platform will dominate the focus of the DNA/RNA market, in terms of sales. Behind ophthalmology, oncology will dominate the therapeutic focus of the DNA/RNA market, and is set to generate 31.2% of 2010 sales. 7 After aptamers, antisense and gene therapies represent the leading technological focus of products set to launch by 2010 in terms of sales, together generating 46% of 2010 sales. 8 The biggest challenge for companies operating in the DNA/RNA market is to demonstrate that they can deliver products beyond Phase III that represent a good alternative to those products already marketed. The principal focus of these companies should therefore be to validate their platform technology with large pharmaceutical or biotech companies. 9 CHAPTER 2 BUSINESS MODEL DYNAMICS 18 Introduction 18 Where is the DNA/RNA market currently? 18 DNA/RNA market evolution 18 DNA/RNA company and market analysis 19 Drivers and resistors to DNA/RNA market evolution: a PESTEL analysis 19 Political, Ethical and Social issues 19 Economics: Pharmacoeconomic issues 23 Legal: Intellectual Property and Regulatory Approval 26 DNA/RNA market and company strategy 30 Alliance strategies – licensing and R&D collaboration 31 Mergers and acquisitions 35 Product development strategy 38 Winning strategies 39 CHAPTER 3 TECHNOLOGICAL AND THERAPEUTIC EVOLUTION 41 Classifying the DNA/RNA market 41 Gene therapy 41 Evolution of vector development 41 Market dynamics of vector choice 46 Market leaders 49 Antisense 51 Evolution 51 Antisense market dynamics 54 RNAi, aptamers, ribozymes and DNA 58 Categories 58 RNAi, aptamers, ribozymes and DNA market dynamics 61 Delivery modality 64 Delivery modality profiles of products set to launch by 2010 65 Innovative delivery modalities in development 66 Therapeutic diversification 68 Key therapeutic development trends across the DNA/RNA market 68 Technological diversification 70 Key technological development trends across the DNA/RNA market 70 Productivity leaders 72 Technological focus of DNA/RNA productivity leaders 72 Therapeutic focus of DNA/RNA market leaders 74 CHAPTER 4 PORTFOLIO AND PIPELINE ANALYSIS 76 Active DNA/RNA programs overview, 2004 76 Methodology of analysing and forecasting products set to launch by 2010 76 DNA/RNA market, 2004 77 The DNA/RNA market to 2010 78 Total and risk adjusted DNA/RNA market forecast to 2010 79 Gene therapies 85 Products scheduled to launch by 2010 85 Gendicine 86 DS-992 88 Advexin (INGN-201) 92 ANG1 (VEGF gene therapy) 96 Cerepro (EG009) 99 BioBypass (AdGVVEGF121.10) 102 tgAAVCF 106 Gene therapy products not scheduled to launch by 2010 110 Antisense therapies 112 Products scheduled to launch by 2010 112 E2F decoy (edifoligide, CGT-003, E2F-D) 113 Genasense (oblimersen sodium) 117 AP 12009 124 Resten-NG (AVI-4126) 127 ProMune (CPG 7909) 130 Kappaproct 133 Vitravene (fomivirsen) 136 ISIS14803 141 Alicaforsen (ISIS2302) 143 ISIS104838 145 Antisense therapy products not scheduled to launch by 2010 147 RNAi, aptamers, ribozymes and DNA 150 Products scheduled to launch by 2010 151 Macugen (pegaptanib) 151 Ampligen (polyI:polyC12U) 155 RNAi, aptamer, ribozyme and DNA products not scheduled to launch by 2010 158 CHAPTER 5 APPENDIX : SUPPORTING DATA 161 Financial data 161 Exchange rates 161 Methodology for therapy area forecasting 162 LIST OF TABLES Table 1: Patenting activity of most active DNA/RNA companies 28 Table 2: Drivers and resistors of collaborations in the DNA/RNA market 33 Table 3: Key deals of most productive DNA/RNA companies, 1996-2003 36 Table 4: Winning strategies in the DNA/RNA market 40 Table 5: Main characteristics of commonly investigated gene therapy vector types 42 Table 6: Main characteristics of commonly investigated antisense platform types 51 Table 7: DNA/RNA market, 2004 77 Table 8: Market potential of each product set to launch by 2010 81 Table 9: Scoring of each product forecast to be launched by 2010, to create a percentage probability of successful launch 83 Table 10: Exchange rates, 2003 161 LIST OF FIGURES Figure 1: The structure of our analysis of the DNA/RNA market, 2004 4 Figure 2: Risk-adjusted total DNA/RNA market forecast, to 2010 6 Figure 3: Total number of active DNA/RNA programs, split by therapeutic focus 7 Figure 4: Total number of active DNA/RNA programs, split by technological focus 8 Figure 5: Balance between business development and innovation for products set to be launched between 2005-2010 38 Figure 6: Technology focus for active gene therapy programs, 2004 46 Figure 7: New gene therapy trials approved by year, 1989-2003 48 Figure 8: Vector focus of most active gene therapy players, 2004 50 Figure 9: Pipeline development focus of antisense subclasses, 2004 54 Figure 10: Platform focus of most productive antisense players, 2004 57 Figure 11: Pipeline development focus of RNAi, aptamers, ribozymes and DNA products, 2004 61 Figure 12: Technology focus of most active RNAi, aptamers, ribozymes and DNA players, 2004 63 Figure 13: Commercial and developmental therapeutic focus of the DNA/RNA market, 2004 69 Figure 14: Commercial and developmental technological focus of the DNA/RNA market, 2004 71 Figure 15: Technological focus of most active DNA/RNA players, 2004 73 Figure 16: Therapeutic focus of most active DNA/RNA players, 2004 74 Figure 17: Timeline of forecast DNA/RNA product launches to 2010 80 Figure 18: Unadjusted total DNA/RNA market forecast, to 2010 82 Figure 19: Risk-adjusted total DNA/RNA market forecast, to 2010 84 Figure 20: Biotech sector sales growth, 2003-2008 84 Figure 21: Gene therapy programs set to launch by 2010, split by technology focus and therapy 85 Figure 22: Early clinical gene therapy programs, split by therapy and technology focus 110 Figure 23: Preclinical gene therapy programs, split by therapy and technology focus 111 Figure 24: Antisense therapy programs set to launch by 2010, split by technology focus and therapy 112 Figure 25: Early clinical antisense therapy programs, split by therapy and technology focus 149 Figure 26: Preclinical antisense programs, split by therapy and technology focus 150 Figure 27: Early clinical RNAi, aptamers, ribozymes and DNA therapy programs, split by therapy and technology focus 159 Figure 28: Preclinical RNAi, aptamers, ribozymes and DNA therapy programs, split by therapy and technology focus 159