Contents:

Chapter 1: Executive Summary Key Points 2004-2006 Chapter 2: Introduction, Scope, and Objectives Early Status and Current Products Driving Forces Customers Competition Scope and Objective Chapter 3: Hybridoma Technology and Antibody Gene Manipulation Introduction Historical Roots A Long Record of Advance Founders of Immunology Classical Antibody Development Polyclonal Antibodies: Still Standing Polyclonal Antibodies Detect a Multiplicity of Epitopes Hybridoma Technology Origins Monoclonal Antibody Production Uses of MAbs Disadvantages of MAb Technology Genetic Immunization Molecular Biology Applied To Antibody Characterization Production of Antibody Libraries Display Technologies Rationally Designed Antibodies Varieties of Engineered Antibodies Bispecific Antibodies Designing Antibodies with Human-like Qualities Chimeric Antibodies Humanized Antibodies Human Antibodies: Transgenic Mouse System References Chapter 4: Status of Therapeutic Antibody Products Introduction Difficulty in Cancer Treatment Antibody Engineering: Light at the End of the Tunnel? Therapeutic Anticancer Antibodies Panorex® (edrecolomab) Rituxan® (rituximab) Herceptin® (traztuzumab) Mylotarg® (gentuzumab) Campath® (alemtuzumab) Zevalin™ (ibritumomab) Erbitux™ (cetuximab) Avastin™ (bevicizumab) Immunoconjugated Anticancer Recombinant Antibodies Challenges in Developing Immunoconjugated Recombinant Antibodies Exploiting Apoptosis-related Strategies Use of Antibody Fragments in Immunoconjugate Technology Optimizing the Effector Function of Recombinant Antibodies Signal Regulation Strategy for Improved Recombinant Antibodies Bifunctional Linkers and Low Molecular Weight Toxins in Recombinant Antibody Design Alternative Approaches to Immunoconjugates Cardiovascular Disorders Infectious Diseases Inflammatory Diseases Raptiva™ (efalizumab) Remicade® (infliximab) Humira™ (adalimumab) Xolair™ (omalizumab) Transplantation Orthoclone OKT3® (muromomab-CD3) Simulect® (basiliximab) Zenapax® (daclizumab) References Chapter 5: Clinical Studies Approved Antibody Therapeutics Therapeutic Antibodies in Development Failed Antibody Therapeutics Catastrophic Clinical Trial Failed, Cancelled, and Disapproved Clinical Studies Status of A Few Selected Ongoing Clinical Studies Phase I Studies Phase II Studies Phase III Studies Products Approved in 200 Chapter 6: Large Scale Manufacturing Overview Companies Involved Risks of Innovation in Biomanufacturing Bioprocessing Technologies Production Systems Escherichia Coli Q-cell Technology TAT System Mammalian Cell Culture Cell Lines Bioreactor Technology Cell Culture Media Yeast Insect Cells Transgenic Plants: Plantabodies Transgenic Animals Robotic Peptide Synthesis Antibody Glycosylation Issues New Purification Tools Monitoring Technologies Is There a Shortage in Manufacturing Capability? Factors Affecting Biomolecule Production Insulin: A Case History of Recombinant Protein Production The Future References Chapter 7: Business Development and Partnering Collaboration and Partnering Mergers and Acquisitions Chapter 8: Patents and Intellectual Property Issues Introduction Intellectual Property Issues Antibody Function Modulation Technologies Litigation between CAT and Abbott Antibody Humanization Human Antibody Technology Antibody Production Boss Patent, New Cabilly and MedImmune lawsuit Xoma Patents Litigations and Co-licensing CAT vs. Morphosys CAT vs. Crucell Cross-licensing between CAT and Xoma Cross-licensing between CAT and Dyax Cross-licensing between Xoma and Morphosys Cross-licensing between Xoma and Dyax Court Rulings about Importing Data More Litigations Xoma vs. Biosite Applied Molecular Evolution vs. Morphosys Corixa and GlaxoSmithKline vs. IDEC Genentech vs. Chiron Genentech, Novartis, and Tanox Settle Disputes involving Xolair and TNX-901 The Single-Chain Antibody Technology Recent IP Issuance and Related Activities Dyax’s Patent Revoked MorphoSys Obtains Approval for HuCAL® Patent MorphoSys Obtains Additional U.S. Patents on Antibody Technologies Peregrine Receives US and European Patent Genentech and Protein Design Labs Settle Patent License Dispute A US Patent Issued on Polyclonal Antibody Libraries Abstracts of the Selected Patents Mentioned in the Text Patent Number: US 4,816,397 Patent Number: US 4,816,567 Patent Number: US 5,175,384 Patent Number: US 5,223,409 Patent Number: US 5,225,539 Patent Number: US 5,403,484 Patent Number: US 5,427,908 Patent Number: US 5,434,340* Patent Number: US 5,530,101 Patent Number: US 5,565,332 Patent Number: US 5,571,698 Patent Number: US 5,580,717 Patent Number: US 5,585,089 Patent Number: US 5,569,825 Patent Number: US 5,591,669 Patent Number: US 5,693,761 Patent Number: US 5,693,762 Patent Number: US 5,723,323 Patent Number: US 5,763,192 Patent Number: US 5,814,476 Patent Number: US 5,817,483 Patent Number: US 5,824,514 Patent Number: US 5,837,500 Patent Number: US 5,849,500 Patent Number: US 5,859,205 Patent Number: US 5,885,793 Patent Number: US 5,939,598 Patent Number: US 5,969,108 Patent Number: US 5,976,862 Patent Number: US 6,054,561 Patent Number: US 6,150,584 Patent Number: US 6,162,963 Patent Number: US 6,180,370 Patent Number: US 6,204,023 Patent Number: US 6,248,516 Patent Number: US 6,335,163 Patent Number: EP 368684 Chapter 9: Market Status Revenues from the Early Products Reopro® Rituxan® Herceptin® Remicade® Synagis® Revenues from the Recently Approved Products Avastin™ Erbitux™ Xolair™ Raptiva™ New Product Approvals Lucentis™ Tysabri® Chapter 10: Company Profiles Exhibit 2.1 Selection of Phage Antibodies from an Antibody Library Exhibit 2.2 Mechanisms of Actions In Vivo of Therapeutic Antibodies Exhibit 2.3 List of Companies Involved in the Discovery and Development of Antibody Therapeutics Exhibit 2.4 List of Therapeutic Monoclonal Antibodies Approved for Additional Indications, September 2006 Exhibit 2.5 Primary Technology Portfolio of a Selected Group of Antibody Companies Exhibit 3.1 Major Events in the History of Immunology Compiled from Various Sources Exhibit 3.2 Basic Structure of an IgG Molecule Exhibit 3.3 A Space-filling Model of an IgG Molecule Exhibit 3.4 The GENOVAC Technology for the Production of Polyclonal (Steps ) and Monoclonal Antibodies (Steps ) Exhibit 3.5 Choices when Constructing a Binding-site Library Exhibit 3.6 Scheme Showing the Principle of Selection and Improvement of Binding Sites Exhibit 3.7 Schematic Diagram of Ribosomal Display Exhibit 3.8 Comparison of Structural Features of Human Antibody, Camelid Antibody, and Nanobodies Exhibit 3.9 Schematic Diagram Showing Structural Features of Single Chain Antibody (scFv) and Fab Fragment Exhibit 3.10 Various Forms of Bispecific Antibodies Exhibit 3.11 Various Types of Antibodies Exhibit 3.12 Schematic Diagram of the Generation of Human Antibody Mouse Exhibit 4.1 Various Mechanisms of Antibody Actions Exhibit 4.2 Approved Monoclonal Antibodies for the Treatment of Various Cancers Exhibit 4.3 Schematic Diagram Showing the Mechanism of ADCC Exhibit 4.4 Schematic Diagram Showing the Structural Feature of Epidermal Growth Factor Receptor and the Binding to its Ligand (egf) Exhibit 4.5 EGFR Expression in Various Tumors Exhibit 4.6 Approved Antibody Therapeutic for the treatment of Cardiovascular Disorders Exhibit 4.7 Summary of Antibody Studies in the Prevention and Treatment of Infectious Diseases Exhibit 4.8 Approved Antibody for the Treatment of Infectious Disease Exhibit 4.9 Approved MAbs for the Treatment of Inflammatory Diseases Exhibit 4.10 Inflammation in the Rheumatoid Joint Exhibit 4.11 Mode of Action of Xolair™ Exhibit 4.12 Market for Drugs to Treat Asthma in US $ Million Exhibit 4.13 Approved MAb for the Treatment of Transplantation Exhibit 5.1 List of Approved Therapeutic Monoclonal Antibodies for Major Markets, September 2006 Exhibit 5.2 List of Therapeutic Monoclonal Antibodies Approved for Additional Indications, September 2006 Exhibit 5.3 Therapeutic Categories of Approved MAbs Exhibit 5.4 Types of MAbs Approved Between 1986 and 2006 Exhibit 5.5 Types of MAbs Currently in Development Exhibit 5.6 List of Monoclonal Antibody Therapeutics in Development (assembled by alphabetized company names) Exhibit 5.7 List of Monoclonal Antibody Therapeutics in Development (assembled by therapeutic indication in alphabetical order) Exhibit 5.8 Therapeutic Categories of Clinical Trials Exhibit 5.9 Therapeutic Antibodies at Various Development Stages Exhibit 5.10 List of Late-Stage Clinical Trial Failures Exhibit 6.1 Distribution of Cell Culture Reactor Capability by Reactor Volume, Projected for 2006 Exhibit 6.2 Selected North American Contract Manufacturer, Primarily of Biotherapeutics Exhibit 6.3 Selected Contract Manufacturers Outside of North America Exhibit 6.4 Selected Manufacturers Offering Excess Capacity Contracts Exhibit 6.5 Native and Engineered Disulfide Bond formation Pathways in the E. coli Periplasm Exhibit 6.6 A comparison of Widely Used Cell Lines for the Manufacturing of Biotherapeutics Exhibit 6.7 Processing of Asn-linked Oligosaccharides to a Representative Biantennary Complex Glycoprotein Structure Exhibit 7.1 Selected Companies with Antibody Discovery Platforms Which Formed Alliances in the Discovery and Development of Antibody Therapeutics Exhibit 7.2 Selected Companies with Antibody Engineering and Expression Platforms Which Formed Alliances Exhibit 7.3 Valuation of Collaborations Exhibit 7.4 Selected M&As In 2005 And Early 2006 Exhibit 7.5 Detailed List of Alliances Involving a Selected Number of Antibody Drug Discovery and Development Companies Exhibit 8.1 Issued Patents of Xencor Exhibit 8.2 Patent Applications of Xencor Exhibit 8.3 Additional Patent Applications Related to Enhanced Antibody Function Exhibit 8.4 Issued Patents of Kyowa Hakko and BioWa Exhibit 8.5 Patent Applications of Kyowa Hakko and BioWa Exhibit 8.6 Flow-chart Showing Various Technologies Important for MAb Discovery, Modulation and Production and the Primary IP Holders of the Technologies Exhibit 8.7 Key Antibody Phage Display patents of Cambridge Antibody Technology Exhibit 8.8 Single-chain Antibody IP Portfolio of Micromet/Enzon Exhibit 8.9 A Selected List of Relevant US Patents Exhibit 9.1 Yearly Fundraising by the Biotechnology Industry Exhibit 9.2 Status of Market Capitalization of a Selected Group of Antibody Companies Exhibit 9.3 Major Monoclonal Antibody Sales, 200 Exhibit 9.4 Yearly Revenues Earned and Forecasted for Antibody Therapeutics Exhibit 9.5 Annual Sale of Rituxan® in $ million, 2001 – 2005 Exhibit 9.6 Annual Sale of Herceptin® in $ million, 2000 – 2003 Exhibit 9.7 Revenues Generated by Remicade®, 2000 – 2005 Exhibit 9.8 Revenues Generated by Synagis®, 2000 – 2005 Exhibit 9.9 Quarterly Sales of Synagis® from 2001 to 2005 Exhibit 9.10 Comparative Sales of Humira™ and Avastin™, 2003 to 2005 Exhibit 9.11 Current and Projected Sales of Avastin™

Companies Mentioned

- Abgenix - Alexion - Biogen Idec - Cambridge Antibody Technology - ImClone Systems - ImmunoGen - Medarex - MorphoSys - Protein Design Labs - Seattle Genetics - UCB - Xoma