Contents:

INTRODUCTION About Partneringreview Full contents of Partneringreview 2006 Deal overview in 2005 VOLUME 1: COMPANY DEAL INDEX Introduction: Deals announced by company Chapter 1: Deals by company Chapter 2: M&A by company Chapter 3: List of deals VOLUME 2: THERAPY AREA Introduction: Deals announced by therapy area Chapter 1: Oncology Deals in the oncology therapy area by company Deals in the oncology therapy area by industry focus Deals in the oncology therapy area by development stage Chapter 2: Infectious disease Deals in the infectious disease therapy area by company Deals in the infectious disease therapy area by industry focus Deals in the infectious disease therapy area by development stage Chapter 3: Cardiovascular/Circulatory Deals in the cardiovascular/circulatory therapy area by company Deals in the cardiovascular/circulatory therapy area by industry focus Deals in the cardiovascular/circulatory therapy area by development stage Chapter 4: Central Nervous System Deals in the central nervous system therapy area by company Deals in the central nervous system therapy area by industry focus Deals in the central nervous system therapy area by development stage Chapter 5: Autoimmune/Inflammation Deals in the autoimmune/inflammation therapy area by company Deals in the autoimmune/inflammation therapy area by industry focus Deals in the autoimmune/inflammation therapy area by development stage Chapter 6: Metabolism Deals in the metabolism therapy area by company Deals in the metabolism therapy area by industry focus Deals in the metabolism therapy area by development stage Chapter 7: Respiratory Deals in the respiratory therapy area by company Deals in the respiratory therapy area by industry focus Deals in the respiratory therapy area by development stage Chapter 8: Gastrointestinal Deals in the gastrointestinal therapy area by company Deals in the gastrointestinal therapy area by industry focus Deals in the gastrointestinal therapy area by development stage Chapter 9: Musculoskeletal Deals in the musculoskeletal therapy area by company Deals in the musculoskeletal therapy area by industry focus Deals in the musculoskeletal therapy area by development stage Chapter 10: Sensory Organ/Oral Health Deals in the sensory organ/oral health therapy area by company Deals in the sensory organ/oral health therapy area by industry focus Deals in the sensory organ/oral health therapy area by development stage Chapter 11: Genitourinary/Gynecology Deals in the genitourinary/gynecology therapy area by company Deals in the genitourinary/gynecology therapy area by industry focus Deals in the genitourinary/gynecology therapy area by development stage Chapter 12: Dermatology Deals in the dermatology therapy area by company Deals in the dermatology therapy area by industry focus Deals in the dermatology therapy area by development stage Chapter 13: Blood/Lymphatic System Deals in the blood/lymphatic system therapy area by company Deals in the blood/lymphatic system therapy area by industry focus Deals in the blood/lymphatic system therapy area by development stage Chapter 14: Accident/Hospital/Trauma Deals in the accident/hospital/trauma therapy area by company Deals in the accident/hospital/trauma therapy area by industry focus Deals in the accident/hospital/trauma therapy area by development stage Chapter 15: List of deals VOLUME 3: FINANCINGS Introduction: Deals announced by financing type Chapter 1: Grant/award Deals in the financing - grant/award area by company Deals in the financing - grant/award area by therapy focus Deals in the financing - grant/award area by development stage Chapter 2: Equity investment Deals in the equity investment area by company by development stage Chapter 3: Private placement Deals in the financing - private placement area by company Chapter 4: IPO Deals in the financing - IPO area by company Chapter 5: Public offering Deals in the financing - public offering area by company Chapter 6: List of deals VOLUME 4: STAGE OF DEVELOPMENT Introduction: Deals announced by development stage Chapter 1: Early stage – discovery, lead and preclinical Deals in early stage by company Deals in early stage by industry focus Deals in early stage by therapy focus Chapter 2: Clinical stage - phase I to Phase III Deals in clinical stage by company Deals in clinical stage by industry focus Deals in clinical stage by therapy focus Chapter 3: Late stage – registration, approval and marketed Deals in late stage by company Deals in late stage by industry focus Deals in late stage by therapy focus Chapter 4: List of deals VOLUME 5: Deal type Introduction: Deals announced by type Chapter 1: Licensing Deals in licensing by company Deals in licensing by industry focus Deals in licensing by therapy focus Deals in licensing by development stage Chapter 2: Marketing and promotion Deals in marketing and promotion by company Deals in marketing and promotion by industry focus Deals in marketing and promotion by therapy focus Deals in marketing and promotion by development stage Chapter 3: Supply and distribution Deals in supply and distribution by company Deals in supply and distribution by industry focus Deals in supply and distribution by therapy focus Deals in supply and distribution by development stage Chapter 4: Collaborative R&D Deals in collaborative R&D by company Deals in collaborative R&D by industry focus Deals in collaborative R&D by therapy focus Deals in collaborative R&D by development stage Chapter 5: List of deals VOLUME 6: INDUSTRY SECTOR Introduction: Deals announced by industry sector Chapter 1: Pharmaceutical Deals in the pharmaceutical sector by company Deals in the pharmaceutical sector by therapy focus Deals in the pharmaceutical sector by development stage Chapter 2: Biotechnology Deals in the biotechnology sector by company Deals in the biotechnology sector by therapy focus Deals in the biotechnology sector by development stage Chapter 3: Discovery Deals in the discovery sector by company Deals in the discovery sector by therapy focus Deals in the discovery sector by development stage Chapter 4: Research Tools Deals in the research tools sector by company Deals in the research tools sector by therapy focus Deals in the research tools sector by development stage Chapter 5: Diagnostic Deals in the diagnostic sector by company Deals in the diagnostic sector by therapy focus Deals in the diagnostic sector by development stage Chapter 6: Medical device Deals in the medical device sector by company Deals in the medical device sector by therapy focus Deals in the medical device sector by development stage Chapter 7: Bioinformatics Deals in the bioinformatics sector by company Deals in the bioinformatics sector by therapy focus Deals in the bioinformatics sector by development stage Chapter 8: Drug delivery Deals in the drug delivery sector by company Deals in the drug delivery sector by therapy focus Deals in the drug delivery sector by development stage Chapter 9: Academic/Government Deals in the academic/government sector by company Deals in the academic/government sector by therapy focus Deals in the academic/government sector by development stage Chapter 10: List of deals GLOSSARY List of tables, charts VOLUME 1 Figures Figure i.1 Partnering announcements by company 2004 vs 2005 Figure i.2 Top 25 pharma deal activity 2004 vs 2005 VOLUME 2 Tables Table 1 Top oncology area dealmaking companies in 2005 Table 2 Top infectious disease area dealmaking companies in 2005 Table 3 Top cardiovascular/circulatory area dealmaking companies in 2005 Table 4 Top central nervous system area dealmaking companies in 2005 Table 5 Top autoimmune/inflammation area dealmaking companies in 2005 Table 6 Top metabolism area dealmaking companies in 2005 Table 7 Top respiratory area dealmaking companies in 2005 Table 8 Top gastrointestinal area dealmaking companies in 2005 Table 9 Top musculoskeletal area dealmaking companies in 2005 Table 10 Top sensory organ/oral health area dealmaking companies in 2005 Table 11 Top genitourinary/gynecology area dealmaking companies in 2005 Table 12 Top dermatology area dealmaking companies in 2005 Table 13 Top blood/lymphatic system area dealmaking companies in 2005 Table 14 Top accident/hospital/trauma area dealmaking companies in 2005 Figures Fig. i.1 Deals announced by therapy focus Fig. 1.1 Announcements in the oncology therapy area by company Fig. 1.2 Announcements in the oncology therapy area by industry sector Fig. 1.3 Announcements in the oncology therapy area by development stage Fig. 2.1 Announcements in the infectious disease therapy area by company Fig. 2.2 Announcements in the infectious disease therapy area by industry sector Fig. 2.3 Announcements in the infectious disease therapy area by development stage Fig. 3.1 Announcements in the cardiovascular/circulatory therapy area by company Fig. 3.2 Announcements in the cardiovascular/circulatory therapy area by industry sector Fig. 3.3 Announcements in the cardiovascular/circulatory therapy area by development Fig. 4.1 Announcements in the central nervous system therapy area by company Fig. 4.2 Announcements in the central nervous system therapy area by industry sector Fig. 4.3 Announcements in the central nervous system therapy area by development stage Fig. 5.1 Announcements in the autoimmune/inflammation therapy area by company Fig. 5.2 Announcements in the autoimmune/inflammation therapy area by industry sector Fig. 5.3 Announcements in the autoimmune/inflammation therapy area by development stage Fig. 6.1 Announcements in the metabolism therapy area by company Fig. 6.2 Announcements in the metabolism therapy area by industry sector Fig. 6.3 Announcements in the metabolism therapy area by development stage Fig. 7.1 Announcements in the respiratory therapy area by company Fig. 7.2 Announcements in the respiratory therapy area by industry sector Fig. 7.3 Announcements in the respiratory therapy area by development stage Fig. 8.1 Announcements in the gastrointestinal therapy area by company Fig. 8.2 Announcements in the gastrointestinal therapy area by industry sector Fig. 8.3 Announcements in the gastrointestinal therapy area by development stage Fig. 9.1 Announcements in the musculoskeletal therapy area by company Fig. 9.2 Announcements in the musculoskeletal therapy area by industry sector Fig. 9.3 Announcements in the musculoskeletal therapy area by development stage Fig. 10.1 Announcements in the sensory organ/oral health therapy area by company Fig. 10.2 Announcements in the sensory organ/oral health therapy area by industry sector Fig. 10.3 Announcements in the sensory organ/oral health therapy area by development Fig. 11.1 Announcements in the genitourinary/gynecology therapy area by company Fig. 11.2 Announcements in the genitourinary/gynecology therapy area by industry sector Fig. 11.3 Announcements in the genitourinary/gynecology therapy area by development Fig. 12.1 Announcements in the dermatology therapy area by company Fig. 12.2 Announcements in the dermatology therapy area by industry sector Fig. 12.3 Announcements in the dermatology therapy area by development stage Fig. 13.1 Announcements in the blood/lymphatic system therapy area by company Fig. 13.2 Announcements in the blood/lymphatic system therapy area by industry sector Fig. 13.3 Announcements in the blood/lymphatic system therapy area by development stage Fig. 14.1 Announcements in the accident/hospital/trauma therapy area by company Fig. 14.2 Announcements in the accident/hospital/trauma therapy area by industry sector Fig. 14.3 Announcements in the accident/hospital/trauma therapy area by development VOLUME 3 Tables Table 1 Top financing - grant/award type dealmaking companies in 2005 Table 2 Top equity investment type dealmaking companies in 2005 Table 3 Top financing - private placement type dealmaking companies in 2005 Table 4 Top financing - IPO type dealmaking companies in 2005 Table 5 Top financing - public offering type dealmaking companies in 2005 Figures Fig. i.1 Financing deals announced by type Fig. 1.1 Financing - Grant/Award deals by lead investor Fig. 1.2 Financing – Grant/Award deals by therapy area Fig. 1.3 Financing - Grant/Award deals by development stage VOLUME 4 Tables Table 1 Top early stage type dealmaking companies in 2005 Table 2 Top clinical stage type dealmaking companies in 2005 Table 3 Top late stage type dealmaking companies in 2005 Figures Fig. i.1 Deals announced by stage Fig. 1.1 Announcements in early stage by company Fig. 1.2 Announcements in early stage by industry sector Fig. 1.3 Announcements in early stage by therapy area Fig. 2.1 Announcements in clinical stage by company Fig. 2.2 Announcements in clinical stage by industry sector Fig. 2.3 Announcements in clinical stage by therapy area Fig. 3.1 Announcements in late stage by company Fig. 3.2 Announcements in late stage by industry sector Fig. 3.3 Announcements in late stage by therapy area VOLUME 5 Tables Table 1 Top licensing type dealmaking companies in 2005 Table 2 Top marketing and promotion type dealmaking companies in 2005 Table 3 Top supply and distribution type dealmaking companies in 2005 Table 4 Top collaborative R&D type dealmaking companies in 2005 Figures Fig. i.1 Deals announced by type Fig. 1.1 Announcements of type licensing by company Fig. 1.2 Announcements of type licensing by industry sector Fig. 1.3 Announcements of type licensing by therapy area Fig. 1.4 Announcements of type licensing by stage of development Fig. 2.1 Announcements of type marketing and promotion by company Fig. 2.2 Announcements of type marketing and promotion by industry sector Fig. 2.3 Announcements of type marketing and promotion by therapy area Fig. 2.4 Announcements of type marketing and promotion by stage of development Fig. 3.1 Announcements of type supply and distribution by company Fig. 3.2 Announcements of type supply and distribution by industry sector Fig. 3.3 Announcements of type supply and distribution by therapy area Fig. 3.4 Announcements of type supply and distribution by stage of development Fig. 4.1 Announcements of type collaborative R&D by company Fig. 4.2 Announcements of type collaborative R&D by industry sector Fig. 4.3 Announcements of type collaborative R&D by therapy area Fig. 4.4 Announcements of type collaborative R&D by stage of development VOLUME 6 Tables Table 1 Top pharmaceutical sector dealmaking companies in 2005 Table 2 Top biotechnology sector dealmaking companies in 2005 Table 3 Top discovery sector dealmaking companies in 2005 Table 4 Top research tools sector dealmaking companies in 2005 Table 5 Top diagnostic sector dealmaking companies in 2005 Table 6 Top medical device sector dealmaking companies in 2005 Table 7 Top bioinformatics sector dealmaking companies in 2005 Table 8 Top drug delivery sector dealmaking companies in 2005 Table 9 Top academic/government sector dealmaking companies in 2005 Figures Fig. i.1 Deals announced by sector Fig. 1.1 Announcements in the pharmaceutical sector by company Fig. 1.2 Announcements in the pharmaceutical sector by therapy area Fig. 1.3 Announcements in the pharmaceutical sector by stage of development Fig. 2.1 Announcements in the biotechnology sector by company Fig. 2.2 Announcements in the biotechnology sector by therapy area Fig. 2.3 Announcements in the biotechnology sector by stage of development Fig. 3.1 Announcements in the discovery sector by company Fig. 3.2 Announcements in the discovery sector by therapy area Fig. 3.3 Announcements in the discovery sector by stage of development Fig. 4.1 Announcements in the research tools sector by company Fig. 4.2 Announcements in the research tools sector by therapy area Fig. 4.3 Announcements in the research tools sector by stage of development Fig. 5.1 Announcements in the diagnostic sector by company Fig. 5.2 Announcements in the diagnostic sector by therapy area Fig. 5.3 Announcements in the diagnostic sector by stage of development Fig. 6.1 Announcements in the medical device sector by company Fig. 6.2 Announcements in the medical device sector by therapy area Fig. 6.3 Announcements in the medical device sector by stage of development Fig. 7.1 Announcements in the bioinformatics sector by company Fig. 7.2 Announcements in the bioinformatics sector by therapy area Fig. 7.3 Announcements in the bioinformatics sector by stage of development Fig. 8.1 Announcements in the drug delivery sector by company Fig. 8.2 Announcements in the drug delivery sector by therapy area Fig. 8.3 Announcements in the drug delivery sector by stage of development Fig. 9.1 Announcements in the academic/government sector by company Fig. 9.2 Announcements in the academic/government sector by therapy area Fig. 9.3 Announcements in the academic/government sector by stage of development

Summary:

2005 was the year that mergers and acquisitions returned to biopharma dealmaking, with over 230 M&A transactions compared with 170 in 2004 and 150 in 2003. Announcements of major acquisition deals in the healthcare sector marked both the beginning and the end of 2005. In January 2005, Procter & Gamble announced an all-paper transaction to acquire 100% of Gillette, the consumer health and home brands company, in a deal valued at $57 billion (based on closing stock values at deal announcement). A share buyback scheme over 2005 and 2006 will aim to convert the paper transaction into one where 40% of the acquisition price will be in cash. At the latter end of 2005, Boston Scientific and Johnson & Johnson competed to gain control of Guidant, the medical device manufacturer. Johnson & Johnson originally announced an interest in Guidant at the end of 2004; however, the deal hit problems in November 2005 when Guidant filed a lawsuit against Johnson & Johnson for failing to fulfill obligations outlined in the original acquisition agreement. Johnson & Johnson and Guidant quickly agreed new terms for the acquisition, but by this time Boston Scientific sought to outbid Johnson & Johnson by making an offer 14% over that announced by Johnson & Johnson. By the end of 2005, the companies had not finalized a deal, but in early 2006 Guidant and Boston signed a merger agreement, a combined paper and cash transaction with an estimated value of $27 billion. Guidant and Johnson & Johnson terminated the acquisition agreement. Boston Scientific's eventual acquisition of Guidant was not its only M&A activity of 2005. Boston also acquired Advanced Stent Technologies, CryoVascular Systems, Rubicon Medical and TriVascular as it sought to buy further into the cardiovascular devices sector. Johnson & Johnson was also active in acquisitions, acquiring Animas, Closure Medical and Transform Pharmaceuticals. There were a number of smaller acquisitions in 2005, with Novartis in particularly acquisitive mood, acquiring Hexal, Chiron and Eon Labs for a combined $12.8 billion. Other companies making a number of acquisitions during 2005 included: Pfizer (Angiosyn, Bioren, Idun and Vicuron); Agilent Technologies (Computational Biology, Molecular Imaging and Scientific Software); Invitrogen (BioSource, Caltag, Dynal, Quantum Dot and Zymed); and Qiagen (Artus, Nextal, Shenzhen PG and Tainwei Times). Deal and alliance activity in 2005 was slightly lower than 2004, but similar to 2003, with just over 2600 deal and alliance announcements (excluding M&As). The numbers are significantly lower than those seen at the peak of the biotechnology industry boom of the late 1990s. GlaxoSmithKline and Novartis were the most active dealmakers of 2005 with 40 and 37 deal announcements, respectively, with Novartis doubling its deal activity over 2004. The world's largest pharmaceutical company, Pfizer, achieved just 34 deal announcements, up on the previous year but behind GlaxoSmithKline and Novartis. Roche returned to lower deal activity from its exceptional activity of 2004 when it announced nearly twice as many deals as its peer companies. Other companies making fewer deals in 2005 compared with 2004 included Abbott Labs and Merck & Co, the latter perhaps caused by issues associated with the withdrawal of Vioxx. In general, most of the top 25 pharma companies announced more deals in 2005 than in 2004, emphasizing the growing reliance on alliance activity for healthy and robust pipelines. The top deal of 2005 in terms of headline value was the asset acquisition by Reckitt Benckiser of Boots' OTC and healthcare products business for £1.93 billion ($3.4 billion). Reckitt Benckiser competed against some of the world's leading OTC products companies, including Novartis and GlaxoSmithKline. During 2005, more deals were announced in oncology and infectious diseases than in any other therapeutic areas (around 500 and 400 deals respectively). Cardiovascular, CNS and accident/trauma, each with more than 300 deals, followed these. The gastrointestinal area announced fewest deals, with around 100 (a similar number to 2004). The phase of development when the deal is announced continued to be dominated by discovery deals, although the number was down on 2004, confirming the trend within the industry to hold back from dealmaking until data is available. This reduction in dealmaking at discovery stage, together with reluctance of investors to get involved at early stages, continues to be of significant concern for companies that have the ideas but not the funds to take their compounds through to proof of principle. Novartis, Merck & Co and Pfizer made the most early stage deals (discovery and preclinical) during 2005, each with nine or more deals. Early and clinical stage deals were most frequent in oncology, followed by CNS, cardiovascular and autoimmune/inflammation. Novartis announced the most clinical stage deals (phase I-III) during 2005, with eleven deals. In the remaining development stages, the number of deals announced gradually declined as the compounds advanced towards approval. There was a large number of deals announced at product launch or marketing, with over 600 deals announced during 2005, versus nearly 800 in 2004. This is probably due to the nature of such deals; in marketing, promotion and distribution deals, a single asset may be the subject of a number of deals as originators seek to secure out-sourced revenue streams in non-core territories and markets. Collaborative R&D was the most prevalent deal type announced in 2005, with nearly 1,800 deal announcements (versus 1,400 in 2004), followed by around 1,300 supply and distribution deals, which is just up on 2004. Government agencies and research institutes were in top organizations to announce collaborative R&D and supply/distribution deals. Novartis, Pfizer, Crucell, GlaxoSmithKline, Merck & Co, Partek and Daxor each announced over 15 licensing deals, with Pfizer, Novartis, GlaxoSmithKline and AstraZeneca announcing over twelve marketing/promotion deals. In almost all cases, the number of deals announced by the leading companies was up on 2004, indicating a growing reliance on licensing to access pipeline candidates, as well as marketing/promotion deals to increase return on investment in non-core territories access additional products for commercialization. Finally, Partneringreview 2006 includes a new volume, providing a comprehensive coverage of financings in the healthcare sector, from grants and awards through to IPOs. The National Institutes of Health (including the National Cancer Institute and the National Institute for Allergy and Infectious Diseases), along with a number of other government agencies, were most prominent in the award of grants. The Bill & Melinda Gates Foundation made a number of significant donations into healthcare research. During 2005, over 40 IPOs were announced, including Shire with a closing value of $2.98 billion, followed by Coley at $111 million. There were also private financing rounds in 2005, with over 400 completed by the end of the year. The highest value was Wyeth, at $1.5 billion in the form of senior notes. Funds raised were to be used for general corporate and working capital purposes. This was followed by DaVita, with a value at closing of $1.35 billion. The private offering was made within the United States only to qualified institutional buyers, and outside the United States only to non-US investors. The following companies also raised over $500 million during 2005: Mylan Labs, Dade Behring, AmerisourceBergen and Medtronic.

Companies Mentioned

- Pfizer - GlaxoSmithKline - Sanofi-Aventis - Johnson & Johnson - Merck, Novartis - AstraZeneca - Roche - Bristol-Myers Squibb - Wyeth - Abbott Labs - Eli Lilly - Amgen - Takeda - Boehringer Ingelheim - Schering-Plough - Schering AG - Bayer - Eisai - Teva - Merck KGaA - Yamanouchi - Otsuka - Novo Nordisk - Baxter - Fujisawa - Sankyo, Forest Labs - Akzo Nobel - Altana - Serono - Solvay - UCB - Genzyme - Allergan - Mitsubishi Pharma Shionogi - Watson - IVAX - Alcon - H Lundbeck - Biogen Idec - Mylan Labs - Shire - Ono - Tanabe Seiyaku - Daiichi - Barr - Gilead Sciences - Purdue Pharma