From Research to Revenue IV: Capturing Business Opportunities in Asia From Research to Revenue IV: Capturing Business Opportunities in Asia

From Research to Revenue IV: Capturing Business Opportunities in Asia From Research to Revenue IV: Capturing Business Opportunities in Asia

From Research to Revenue IV: Capturing Business Opportunities in Asia From Research to Revenue IV: Capturing Business Opportunities in Asia

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From Research to Revenue IV: Capturing Business Opportunities in Asia From Research to Revenue IV: Capturing Business Opportunities in Asia

From Research to Revenue IV: Capturing Business Opportunities in Asia Outsourcing in Asia Madhav Murti, PricewaterhouseCoopers LLP

The changing dynamics of pharma outsourcing in Asia: Are you readjusting your sights?

Introduction PwC Global Sourcing Advisory

Agenda 1. Introduction 2. Strategic context of outsourcing and location decisions in Asia 3. Moving up the value chain: the changing nature of pharma outsourcing in Asia 4. Evaluating the landscape: the location context for outsourcing decisions 5. Looking ahead

Strategic context of outsourcing and location decisions in Asia

Cluster One – Pharma Revenue Constraints Patent expiry In 2006 > 90% of Big Pharma’s total revenues were from medicines that had been on the market > 5 years. Expiry of patents related to many of these products could result in significant erosion of revenues (estimated around $157 billion) Need for R&D productivity The industry has invested twice as much in R&D in 2006 as it was a decade earlier but only producing two – fifths of the medicines it then produced Pricing Pressures in healthcare markets Quest for improved margins and growth 1

Patent expiry

In 2006 > 90% of Big Pharma’s total revenues were from medicines that had been on the market > 5 years. Expiry of patents related to many of these products could result in significant erosion of revenues (estimated around $157 billion)

Need for R&D productivity

The industry has invested twice as much in R&D in 2006 as it was a decade earlier but only producing two – fifths of the medicines it then produced

Pricing Pressures in healthcare markets

Quest for improved margins and growth

Cluster Two – Asia growth focus Growth in Asian pharma markets China and India pharma markets are experiencing annual growth of 10 -15% and are expected to grow to about 150% and 90% respectively of US market Growth in Asian pharma manufacturing capability Asian Contract Manufacturing Organizations (CMO) are expected to account for about 15% of the total CMO market by 2010. Rapid maturity with increase in FDA approvals and GMP certification Attractive cost arbitrage on manufacturing operations Growth in Asian Scientific Resource Base and Capabilities Growth in Patient Pool Asia accounts for > 60% of the world’s population Vast clinical trial pool offers significant cost savings as well as reduction in patient enrolment time 2

Growth in Asian pharma markets

China and India pharma markets are experiencing annual growth of 10 -15% and are expected to grow to about 150% and 90% respectively of US market

Growth in Asian pharma manufacturing capability

Asian Contract Manufacturing Organizations (CMO) are expected to account for about 15% of the total CMO market by 2010.

Rapid maturity with increase in FDA approvals and GMP certification

Attractive cost arbitrage on manufacturing operations

Growth in Asian Scientific Resource Base and Capabilities

Growth in Patient Pool

Asia accounts for > 60% of the world’s population

Vast clinical trial pool offers significant cost savings as well as reduction in patient enrolment time

Cluster Three – East/West convergence/ divergence trends Intellectual Property & Legal Landscape Though much needs to be done, IP protection and rights are increasingly improving in certain Asian countries Clinical Trials and pharma regulation Regulatory delays and complexities can hinder the development of clinical trials East/West disease profiles On the one hand, variations in disease profiles due to differences in ethnic origin, diet and environmental factors, yet On the other, reduction in divergence due to urbanization and convergence of tastes and lifestyles between the East & West Escalation in Labour and other overhead costs 3

Intellectual Property & Legal Landscape

Though much needs to be done, IP protection and rights are increasingly improving in certain Asian countries

Clinical Trials and pharma regulation

Regulatory delays and complexities can hinder the development of clinical trials

East/West disease profiles

On the one hand, variations in disease profiles due to differences in ethnic origin, diet and environmental factors, yet

On the other, reduction in divergence due to urbanization and convergence of tastes and lifestyles between the East & West

Escalation in Labour and other overhead costs

Cluster Four – Technological/business model forces Need for more advanced/flexible manufacturing Development and evolution of new products will drive demands for newer technology and a more sophisticated manufacturing environment Closing the gap between R&D, manufacturing and patients Need and desire to close the gaps within the pharma value chain will impact the decisions on location and sourcing model options Blurring of assessment of Core vs Non Core activities Opportunity to tap into external skills to accelerate own capabilities will expand the scale and scope of what can be outsourced Third party models evolve rapidly to more collaborative ‘partnership’ focus Networked Business Models Pharma business model moving away from fully integrated operations to a networks of collaboration and discovery (Eli Lilly – FIPCO to FIPNET) 4

Need for more advanced/flexible manufacturing

Development and evolution of new products will drive demands for newer technology and a more sophisticated manufacturing environment

Closing the gap between R&D, manufacturing and patients

Need and desire to close the gaps within the pharma value chain will impact the decisions on location and sourcing model options

Blurring of assessment of Core vs Non Core activities

Opportunity to tap into external skills to accelerate own capabilities will expand the scale and scope of what can be outsourced

Third party models evolve rapidly to more collaborative ‘partnership’ focus

Networked Business Models

Pharma business model moving away from fully integrated operations to a networks of collaboration and discovery (Eli Lilly – FIPCO to FIPNET)

Moving up the value chain: the changing nature of pharma outsourcing in Asia The trend towards high end innovation: from late stage clinical trials and low cost manufacturing moving up the value chain: facilitated by the evolution in IP protection Risk based deals :Eli Lilly with Nicolas Piramal, Suven Pharma, Hutchinson MediPharma “ in-sourcing” (Eli Lilly, GSK, Astra Zeneca) researched-based partnerships between pharma companies (Merck- Advinus Therapeutics, Ranbaxy, Dr.Reddy’s)

Moving up the value chain: the changing nature of pharma outsourcing in Asia

The trend towards high end innovation:

from late stage clinical trials and low cost manufacturing

moving up the value chain: facilitated by the evolution in IP protection

Risk based deals :Eli Lilly with Nicolas Piramal, Suven Pharma, Hutchinson MediPharma

“ in-sourcing” (Eli Lilly, GSK, Astra Zeneca)

researched-based partnerships between pharma companies (Merck- Advinus Therapeutics, Ranbaxy, Dr.Reddy’s)

Moving up the value chain Rapid expansion of clinical trials in Asia India 2003: 40 – 50 clinical trials 2007: 270 clinical trials 2008: completed 737 clinical trials China 2008: completed 870 clinical trials Drivers: - cost - IPP improvement - “treatment naïve” patients - recruit more quickly from a smaller number of sites

Moving up the value chain

Rapid expansion of clinical trials in Asia

India 2003: 40 – 50 clinical trials

2007: 270 clinical trials

2008: completed 737 clinical trials

China 2008: completed 870 clinical trials

Drivers:

- cost

- IPP improvement

- “treatment naïve” patients

- recruit more quickly from a smaller number of sites

Moving up the value chain Manufacturing scales up • cost: India 50% cheaper than west • large pool of qualified talent to run manufacturing plants - India: > 100 FDA approved facilities - China: > source of APIs shipped globally > first FDA approved site for finished drug > increased effort of SFDA

Moving up the value chain Manufacturing scales up David Brennan, CEO AstraZeneca: “ all active pharmaceutical ingredients will be produced externally within a decade as part of the strategy of maximizing the efficiency of our supply chain while maintaining the highest possible standards of quality and security of supply.”* AstraZeneca plans to increase its outsourcing drastically from China and India. The firm has set up a dedicated sourcing centre in Shanghai. *Financial Times, 16 April 2008

Evaluating the landscape: the location context for outsourcing decisions

Evaluating the landscape: the location context for outsourcing decisions Outsourcing index – ranking of Asian territories across all factors

Evaluating the landscape: the location context for outsourcing decisions Cost ranking of Asian territories

Evaluating the landscape: the location context for outsourcing decisions Risk ranking of Asian territories

Evaluating the landscape: the location context for outsourcing decisions Market Opportunity ranking of Asian territories

Looking ahead China & India spearhead growth in Asian pharma Singapore will maintain position as centre for research and innovation China, India and Singapore remain hotspots with Korea and Taiwan becoming increasingly significant Outsourcing will continue to move up the value chain As pharma investments in Asia grow: high end drug discovery in Asia plays a more important role Insourcing preferred model for higher end activities, complemented by strategic partnerships No “one size fits all” => mixed approach

Looking ahead

China & India spearhead growth in Asian pharma

Singapore will maintain position as centre for research and innovation

China, India and Singapore remain hotspots with Korea and Taiwan becoming increasingly significant

Outsourcing will continue to move up the value chain

As pharma investments in Asia grow: high end drug discovery in Asia plays a more important role

Insourcing preferred model for higher end activities, complemented by strategic partnerships

No “one size fits all” => mixed approach

Looking ahead “ For us, China is not about outsourcing and cheap labour…It’s about different science…Within 5 to 10 years we will be moving from 'made in China’ to ‘discovered in China’” Moncef Slaoui Chairman of Research and Development, GlaxoSmithKline

Sourcing Decisions in times of uncertainty and turmoil Even in the best of times outsourcing solutions require careful planning and structuring to deliver full value. The temptation now is to move quickly to extract additional value. But, in the face of growing economic uncertainty and increasing market complexity, programmes demand a higher level of scrutiny and focus

Even in the best of times outsourcing solutions require careful planning and structuring to deliver full value. The temptation now is to move quickly to extract additional value.

But, in the face of growing economic uncertainty and increasing market complexity, programmes demand a higher level of scrutiny and focus

Source: Sourcing decisions during economic downturns, PwC Point of View Dec 2008 Key areas for consideration Buy Side Organizations look to downscale/ cancel current outsourcing commitments Buy Side Organizations look to rapidly reduce scale/cost of insourced commitments Market volatility continues (Currency fluctuations, Stock Price movements) Economic slowdown inhibits organizational ability to sustain growth & improvement initiatives Issue Service Providers faced with weak financial leverage due to excess capacity and high fixed cost levels Service Provider business model/ operational plans/ability at risk Captive Operations become attractive options for acquisitions Business Case strengthens for variabilizing fixed costs Currency hedging becomes a prominent part of deal structuring and economics Emergence of new attractive supply side locations due to weakening of local currencies and increased availability of resources Higher risk profile of Alternate Sourcing arrangements Potential Impact Opportunities/Challenges Buy Side Negotiation/Renegotiation of additional benefits ( incremental cost impact, leverage capacity etc.) Need for additional rigor in service provider evaluation/selection Potential to accelerate time to benefit Higher level of risk assessment on service provider business viability Sell Side Retention of resource bench in face of uncertain demand Negotiation/Renegotiation of deals to offset capacity and leverage issues Expansion of footprint into emerging supply side locations Consolidation of Service Providers Fig 1 – PwC Analysis

Service Providers faced with weak financial leverage due to excess capacity and high fixed cost levels

Service Provider business model/ operational plans/ability at risk

Captive Operations become attractive options for acquisitions

Business Case strengthens for variabilizing fixed costs

Currency hedging becomes a prominent part of deal structuring and economics

Emergence of new attractive supply side locations due to weakening of local currencies and increased availability of resources

Higher risk profile of Alternate Sourcing arrangements

Buy Side

Negotiation/Renegotiation of additional benefits ( incremental cost impact, leverage capacity etc.)

Need for additional rigor in service provider evaluation/selection

Potential to accelerate time to benefit

Higher level of risk assessment on service provider business viability

Sell Side

Retention of resource bench in face of uncertain demand

Negotiation/Renegotiation of deals to offset capacity and leverage issues

Expansion of footprint into emerging supply side locations

Consolidation of Service Providers

Current market conditions expose new opportunities to reap significant financial and non financial benefits from alternate sourcing arrangements even in the face of market turmoil. Organizations would be well served to explore these opportunities in their strategic context and develop appropriate sourcing strategies that consider both short and long-term implications. Increased market complexity and risk are clear concerns requiring careful consideration and sharp focus, but they should not stop organizations from taking action that could build business flexibility and accelerate competitive advantage on the up-side of an economic recovery. CONCLUSION Source: Sourcing decisions during economic downturns, PwC Point of View Dec 2008

Thank you The changing dynamics of pharma outsourcing in Asia: Are you readjusting your sights? Madhav Murti Vice President - Global Sourcing Advisory [email_address]

From Research to Revenue IV: Capturing Business Opportunities in Asia From Research to Revenue IV: Capturing Business Opportunities in Asia

From Research to Revenue IV: Capturing Business Opportunities in Asia Analysis of Asian Markets Moderator: Gail Garland, Axela Inc. Sarah Frew, McLaughlin - Rotman Centre for Global Health Paul Stinson, CAPRA International Ron Choudhury, Aird & Berlis LLP Hadi Salah, Frost & Sullivan

Analysis of Asian Markets: Focus on India and China December 3, 2008 Hadi Salah [email_address]

APAC? Why should I care? Customer Base: 54% of the world’s population Unprecedented population growth Growing aging population Revenue Potential: 33% of the world’s GDP Increasing affluence Estimated $889.1 billion total healthcare market (2008)

Customer Base:

54% of the world’s population

Unprecedented population growth

Growing aging population

Revenue Potential:

33% of the world’s GDP

Increasing affluence

Estimated $889.1 billion total healthcare market (2008)

Key Healthcare Market Segments Healthcare Pharmaceuticals Biotechnology Medical devices Diagnostics Healthcare IT Patient care Clinical research Contract research/outsourcing

India: Economic Trends One of the fastest growing economies in the world Third largest economy in Asia, after Japan and China Growing at 7-10% per year (2004-2007), GDP expected to reach $1.45 billion by 2010 (CAGR of 13.1% from 2000-2010) Per capita income increasing (currently at $5) Inflation is stable at 3.8-4.6%

One of the fastest growing economies in the world

Third largest economy in Asia, after Japan and China

Growing at 7-10% per year (2004-2007), GDP expected to reach $1.45 billion by 2010 (CAGR of 13.1% from 2000-2010)

Per capita income increasing (currently at $5)

Inflation is stable at 3.8-4.6%

India: Pharmaceuticals Market Segment

India: Biotechnology Market Segment

Investment in India: Drivers and Restraints Restraints Drivers High Med Low Low Med High Low cost of production * Length of arrow indicates relative impact Low cost man power, strong scientific base and talent Low healthcare per capita spending Highly fragmented market Government incentives Entry of large global pharma firms Rural penetration potential Emerging APAC healthcare hubs

China: Economic Trends Fourth largest economy in the world, after the US, Japan, and Germany Annual growth rate estimated at 8% (2006-2010) Healthcare industry is seventh largest in the world High per capita healthcare spending relative to India ($20 vs $5), low relative to developed nations ($700 for US)

Fourth largest economy in the world, after the US, Japan, and Germany

Annual growth rate estimated at 8% (2006-2010)

Healthcare industry is seventh largest in the world

High per capita healthcare spending relative to India ($20 vs $5), low relative to developed nations ($700 for US)

China: Pharmaceuticals Market Segment

China: Biotechnology Market Segment

Investment in China: Drivers and Restraints Restraints Drivers High Med Low Low Med High Rapid economic growth, increased purchasing power * Length of arrow indicates relative impact Increasing private investment is driving innovation Lack of clarity and policies Inadequate legal enforcement Government incentives and increased investment Insufficient IP protection Rural penetration potential Weaker management training

Thank you Hadi Salah Industry Analyst Technical Insights Frost & Sullivan “ We accelerate growth”

Hadi Salah

Industry Analyst

Technical Insights

Frost & Sullivan

“ We accelerate growth”

The Indian and Chinese Health Biotech Industries: Competitors or Collaborators of Canadian Firms? December 3, 2008 Sarah E. Frew, Ph.D Sarah.frew@mrcglobal.org McLaughlin-Rotman Centre for Global Health Program on Ethics and Commercialization

McLaughlin-Rotman Centre For Global Health Based in MaRS 50 people International talent Over $50 Million raised for research Spin off company: FIO Corporation

Based in MaRS

50 people

International talent

Over $50 Million raised for research

Spin off company: FIO Corporation

Purpose : To explore how the domestic private sector in Developing Countries (DCs) can contribute to the development of health technologies that address local health needs. Cases include: India , China , Brazil, South Africa, Ghana, Tanzania, Rwanda Qualitative Research Methods : Semi-structured interviews with key informants Background documents Private Sector Development in Developing Countries: Innovative Firms

Purpose :

To explore how the domestic private sector in Developing Countries (DCs) can contribute to the development of health technologies that address local health needs.

Cases include: India , China , Brazil, South Africa, Ghana, Tanzania, Rwanda

Qualitative Research Methods :

Semi-structured interviews with key informants

Background documents

Purpose : To explore how the domestic private sector in Developing Countries (DCs) can contribute to the development of health technologies that address local health needs. Cases include: India , China , Brazil, South Africa, Ghana, Tanzania, Rwanda Qualitative Research Methods : Semi-structured interviews with key informants Background documents Private Sector Development in Developing Countries: Innovative Firms Objectives: 1. Survey core competencies 2. Explore how, when and why IDC SMEs form linkages 3. Assess capabilities in: human and financial R&D resources, manufacturing, intellectual property and regulatory affairs 4. Identify incentives for and barriers to addressing local health needs 5. Explore financial issues

Purpose :

To explore how the domestic private sector in Developing Countries (DCs) can contribute to the development of health technologies that address local health needs.

Cases include: India , China , Brazil, South Africa, Ghana, Tanzania, Rwanda

Qualitative Research Methods :

Semi-structured interviews with key informants

Background documents

Private Sector Development in Developing Countries Nat. Biotechnol. 25 (4), 403-417 (2007). Nat. Biotechnol. 26 (1), 37-53 (2008). Brazil: Nature Biotechnology 26 (6), 627-644 (2008).

India in Brief Population: 1.1 Billion (1.6B/2050) Leading causes of death Heart Disease Cerebraovascular Disease Infectious and parasitic Diseases (Diarrhoeal, TB, HIV/AIDS) Lower respiratory Diseases Biosciences and Engineering 700,000 Post-graduates 15,000 PhDs 15,000 scientists in Nat’l Res Labs 17,000 Medical Practitioners / yr. Total Biotech Market: US$2.2B (growing at 37%) Targets: $5B by 2010 10% global market by 2010 Total No. of biotech cos: >280 >75% less than 10yrs old. Growing 35-40% per year BioPharmaceutical market: US$1.04B Vaccines, therapeutics, diagnostics 53% Export 47% Domestic ~= $500M Domestic vaccine growing 38% Increasing Share of Global Contract Service Industry by 45 CROs 2005: $100-120 million, growing 20-25% / yr. Projected to reach $2 billion by 2010 by Frost & Sullivan. 35% of their business in drug discovery (synthetic chemistry) 65% in clinical trials arena

Population: 1.1 Billion (1.6B/2050)

Leading causes of death

Heart Disease

Cerebraovascular Disease

Infectious and parasitic Diseases (Diarrhoeal, TB, HIV/AIDS)

Lower respiratory Diseases

Biosciences and Engineering

700,000 Post-graduates

15,000 PhDs

15,000 scientists in Nat’l Res Labs

17,000 Medical Practitioners / yr.

Total Biotech Market: US$2.2B (growing at 37%)

Targets: $5B by 2010

10% global market by 2010

Total No. of biotech cos: >280

>75% less than 10yrs old.

Growing 35-40% per year

BioPharmaceutical market: US$1.04B

Vaccines, therapeutics, diagnostics

53% Export

47% Domestic ~= $500M

Domestic vaccine growing 38%

Increasing Share of Global Contract Service Industry by 45 CROs

2005: $100-120 million, growing 20-25% / yr.

Projected to reach $2 billion by 2010 by Frost & Sullivan.

35% of their business in drug discovery (synthetic chemistry)

65% in clinical trials arena

New Delhi Panacea Biotec Lifecare Innovations Mumbai / Pune Wockhardt Serum Institute of India Bharat Serums and Vaccines Reliance Life Sciences SIRO Clinpharm Nicholas Piramal Hyderabad Shantha Biotechnics Bharat Biotech International Indian Immunologicals Dr. Reddy’s Laboratories Transgene Biotech Biological E Bangalore Biocon Syngene Clinigene International Bhat Bio-Tech India Strand Genomics Avestha Gengraine Gangagen Case Studies of 21 Indian Firms Including 10 of Top 20 Indian Biotech Firms

Biocon Limited, Bangalore Financing North American SMEs Proprietary Fermentation Technologies PlaFractor Technology (2001 US Patent) Cost-effective process for statins, etc. Affordable products for domestic market Insugen™ (human recombinant insulin) for India’s 30 Million diabetics (6% adults) priced ~50% lower than imported product Expanding development capabilities and marketed products through subsidiaries and strategic alliances Syngene (w/ BMS, e.g.), Clinigene Biocon Biopharmaceuticals: JV w/CIMAB, Cuba for EGFR mAb in India Abraxis BioScience: GCSF and Abraxane JV w/ NeoPharma for Gulf countries Co-development partnerships Vaccinex, therapeutic antibodies Nobex (acquired in ‘05), filed PCT patent for oral insulin manufacturing process 2006 “ W e’ve actually not only helped (Nobex) to stay alive, but we’ve retained their jobs for their employees, we are funding their whole survival. … And here there is an Indian company helping to keep jobs in the US .” --Kiran Mazumdar-Shaw, CEO

Proprietary Fermentation Technologies

PlaFractor Technology (2001 US Patent)

Cost-effective process for statins, etc.

Affordable products for domestic market

Insugen™ (human recombinant insulin) for India’s 30 Million diabetics (6% adults) priced ~50% lower than imported product

Expanding development capabilities and marketed products through subsidiaries and strategic alliances

Syngene (w/ BMS, e.g.), Clinigene

Biocon Biopharmaceuticals: JV w/CIMAB, Cuba for EGFR mAb in India

Abraxis BioScience: GCSF and Abraxane

JV w/ NeoPharma for Gulf countries

Co-development partnerships

Vaccinex, therapeutic antibodies

Nobex (acquired in ‘05), filed PCT patent for oral insulin manufacturing process 2006

“ W e’ve actually not only helped (Nobex) to stay alive, but we’ve retained their jobs for their employees, we are funding their whole survival. … And here there is an Indian company helping to keep jobs in the US .” --Kiran Mazumdar-Shaw, CEO

China in Brief Population: 1.3 Billion (1.5B/2050) Leading causes of death Malignant neoplasms Cerebraovascular Disease Heart disease Respiratory Disease Human Resources & Infrastructure 400 Biotechnology-related colleges and research institutes 30,000 annual life sciences grads 64 specialized biotech parks Recruit international scientists Recruit R&D and biopharma centres Government support for Biotech Investment of $1.7B 2001-2005 Biotech market generated total revenue of $5.6 Billion in 2007 25% Annual Growth 92% market in Medical/healthcare Represents 15% of Asia-Pacific market Represents < 7% of global market Total No. of bio-pharmaceutical cos: ~ 250 - 350 companies 40% growth in last 5 years Approved BioPharmaceuticals 15 products approved 60 biologics in pipeline, including ~20 antibodies and ~10 vaccines

Population: 1.3 Billion (1.5B/2050)

Leading causes of death

Malignant neoplasms

Cerebraovascular Disease

Heart disease

Respiratory Disease

Human Resources & Infrastructure

400 Biotechnology-related colleges and research institutes

30,000 annual life sciences grads

64 specialized biotech parks

Recruit international scientists

Recruit R&D and biopharma centres

Government support for Biotech

Investment of $1.7B 2001-2005

Biotech market generated total revenue of $5.6 Billion in 2007

25% Annual Growth

92% market in Medical/healthcare

Represents 15% of Asia-Pacific market

Represents < 7% of global market

Total No. of bio-pharmaceutical cos:

~ 250 - 350 companies

40% growth in last 5 years

Approved BioPharmaceuticals

15 products approved

60 biologics in pipeline, including ~20 antibodies and ~10 vaccines

Case Studies of 22 Chinese Health Biotechnology Firms Changchun GeneScience Beijing Beijing Wantai Biol. Bio-Bridge Science CapitalBio China PKU Bioway Fusogen Pharma Sinocells Biotech. SinoGenoMax Sinovac Biotech Starvax Internat’l. Shenzhen Beike Biotech Shenzhen Chipscreen Biosciences Shenzhen SiBiono GeneTech Shanghai HD Biosciences Fudan-Yueda Bio-tech Shanghai Genomics Genon Bio-engineering Huaguan Biochip Sunway Biotech United Cell Biotech WuXi PharmaTech Xiamen Amoytop

WuXi PharmaTech, Shanghai Aiming to be a fully integrated service provider Contract Service Company Founded in 2001 by 4 “returnees” IPO on NYSE in Aug 2007 Capabilities include: lead generation and optimization, process research, GMP pilot manufacturing, bioanalytical services Aiming to move into: biology and bioanalytical services, preclinical toxicology, animal studies, formulations In 2008, Acquired AppTec Laboratory Services (US) for $151 Million Clients include: 19/20 top global pharmaceutical companies & 8/10 top global biopharmaceutical companies. Compete on cost, operations, and IP protection Dr. Ge Li, Chairman and CEO, a returning “Sea Turtle”, says: “ IP is the lifeblood for a company like ours .”

Contract Service Company

Founded in 2001 by 4 “returnees”

IPO on NYSE in Aug 2007

Capabilities include: lead generation and optimization, process research, GMP pilot manufacturing, bioanalytical services

Aiming to move into: biology and bioanalytical services, preclinical toxicology, animal studies, formulations

In 2008, Acquired AppTec Laboratory Services (US) for $151 Million

Clients include: 19/20 top global pharmaceutical companies & 8/10 top global biopharmaceutical companies.

Compete on cost, operations, and IP protection

Lack of Advanced Training Programs Dearth of Risk Capital and Investment Exits Culture for Public-Private Collaboration Regulatory Bureaucracy Few Incentives to Address Needs of the Poor Barriers to India and China’s Health Biotech Development International Credibility Cultural Differences, Language, Travel IP Protection Enforcement Innovative Culture vs Me-Too Culture Lack of Knowledge about International Markets & Regulations

Lack of Advanced Training Programs

Dearth of Risk Capital and Investment Exits

Culture for Public-Private Collaboration

Regulatory Bureaucracy

Few Incentives to Address Needs of the Poor

International Credibility

Cultural Differences, Language, Travel

IP Protection Enforcement

Innovative Culture vs Me-Too Culture

Lack of Knowledge about International Markets & Regulations

Focus on locally-relevant products with large domestic markets Generate revenues early w/ niche products, & leverage for later growth. Explore funding opportunities on a project-specific basis from domestic & international sources (India) and from initiatives at Municipal, Provincial, & State levels (China) Be proactive in establishing collaborations with domestic and international public and private organizations Protect intellectual property with an eye on global competitiveness Take advantage of “ Brain Gain ” - senior managers trained/worked abroad are instrumental in forging initial partnering relationships Lessons Learned from India and China’s Health Biotech Sectors

Focus on locally-relevant products with large domestic markets

Generate revenues early w/ niche products, & leverage for later growth.

Explore funding opportunities on a project-specific basis from domestic & international sources (India) and from initiatives at Municipal, Provincial, & State levels (China)

Be proactive in establishing collaborations with domestic and international public and private organizations

Protect intellectual property with an eye on global competitiveness

Take advantage of “ Brain Gain ” - senior managers trained/worked abroad are instrumental in forging initial partnering relationships

Canada Lacks Global Competitiveness Presentation Title / Date

A Problem With Canada’s Innovation Agenda Canada’s Public R&D investment: > $13 billion Canada’s commercialization output: ? Presentation Title / Date

Canada’s Public R&D

investment: > $13 billion

Canada’s commercialization output: ?

What Impedes Canadian Commercialization? Almost exclusive focus on technology push , rather than market demand . Where market demand is considered, the exclusive markets of focus are industrialized markets such as the United States, Europe and Japan, with little attention paid to the ”Rest of World” markets . Presentation Title / Date

Almost exclusive focus on technology push , rather than market demand .

Where market demand is considered, the exclusive markets of focus are industrialized markets such as the United States, Europe and Japan, with little attention paid to the ”Rest of World” markets .

Enabling Canadian Firms to Reach International Markets Presentation Title / Date

International Biotech Partnering Conference Results : Over 200 participants and 70 presenters from companies in India, China, Brazil, South Africa, Ghana, Nigeria, US and Canada. Arranged over 50 private one-on-one partnering meetings. We are tracking a number of deals, including 4 with Canadian firms, that are currently under negotiation.

Results :

Over 200 participants and 70 presenters from companies in India, China, Brazil, South Africa, Ghana, Nigeria, US and Canada.

Arranged over 50 private one-on-one partnering meetings.

We are tracking a number of deals, including 4 with Canadian firms, that are currently under negotiation.

Thank You! Presentation Title / Date Additional funding partners for the McLaughlin-Rotman Centre for Global Health can be found at www.mrcglobal.org

China Biopharma – Open for Business! Paul Stinson CAPRA International December 3, 2008

Here’s What I Will Cover Today Why China is Important What’s Your China Strategy? Some Lessons from the Trenches

Why China is Important

What’s Your China Strategy?

Some Lessons from the Trenches

Ignore China at Your Peril Venture Money Available for Knowledge Economy Science & Tech Parks and Incentives in Every Province Five Year Plan 2006-2010 Goals Will Be Achieved! Every Major Pharma Company is There

Venture Money Available for Knowledge Economy

Science & Tech Parks and Incentives in Every Province

Five Year Plan 2006-2010 Goals Will Be Achieved!

Every Major Pharma Company is There

Why is Canada so Far Behind in China? Government to Government Relations since 2005 Canada’s Reliance on US Trade CCBC Caters to Large Canadian Enterprises SME’s Generally Not There in Life Sciences We are Risk-Averse. We Fear the Unknown. Result: Canada’s Engagement is Miles Behind Australia

Government to Government Relations since 2005

Canada’s Reliance on US Trade

CCBC Caters to Large Canadian Enterprises

SME’s Generally Not There in Life Sciences

We are Risk-Averse. We Fear the Unknown.

Result: Canada’s Engagement is Miles Behind Australia

What’s YOUR China Strategy? CME survey – 80% recognize need for China Strategy but only 30% have one Be Entrepreneurial! Plan, then Implement … before someone beats you to it! Follow-up is Critical Canadian Companies Can Help You CAPRA, Sinam, Engage China, Bell Alliances

CME survey – 80% recognize need for China Strategy but only 30% have one

Be Entrepreneurial! Plan, then Implement

… before someone beats you to it!

Follow-up is Critical

Canadian Companies Can Help You

CAPRA, Sinam, Engage China, Bell Alliances

CAPRA Will Help You Source Funding & Partnerships StrategicAlliance with ChinaBio LLC, Shanghai Investors Forums – Beijing Dec 11-12 ChinaBio Partnering Forum – Shanghai Jun3-4 “ Helping China Biotech Become Global Biotech” www.chinabiollc.com The Balloch Group will finance in China – see www.ballochgroup.com

StrategicAlliance with ChinaBio LLC, Shanghai

Investors Forums – Beijing Dec 11-12

ChinaBio Partnering Forum – Shanghai Jun3-4

“ Helping China Biotech Become Global Biotech”

www.chinabiollc.com

The Balloch Group will finance in China – see www.ballochgroup.com

Some Lessons from the Trenches Do not go in alone – China is not for the faint of heart Use our Embassies & Trade Commissioners China’s Embassy in Ottawa is there to help Science & Tech Counsellor Do your Research in Advance – and then be Ready for Surprises!

Do not go in alone – China is not for the faint of heart

Use our Embassies & Trade Commissioners

China’s Embassy in Ottawa is there to help

Science & Tech Counsellor

Do your Research in Advance – and then be Ready for Surprises!

Recognise Cultural Differences Guangxi - Relationships Importance of Face No Overnight Success Connections Take Time Listen More than Your Speak Be Opportunistic

Guangxi - Relationships

Importance of Face

No Overnight Success

Connections Take Time

Listen More than Your Speak

Be Opportunistic

Canadians and Chinese Do Business Differently Recognise difference in time-lines Canada: Paralysis by Analysis China: Relationships, then Action Contracts – word vs. written Intellectual Property – perception meets reality

Recognise difference in time-lines

Canada: Paralysis by Analysis

China: Relationships, then Action

Contracts – word vs. written

Intellectual Property – perception meets reality

China is Open for Biopharma Business! www.caprainc.com [email_address]

ANALYSIS OF ASIAN MARKETS – THE LEGAL PERSPECTIVE Ron Choudhury Aird & Berlis LLP 416.865.3071 [email_address]

Overview Asian Legal Systems – Focus on India Investment Vehicles Intellectual Property Regulation Intellectual Property Protection Dispute Resolution Best practices

Asian Legal Systems – Focus on India

Investment Vehicles

Intellectual Property Regulation

Intellectual Property Protection

Dispute Resolution

Best practices

Legal Systems in Asia Common law in South Asia Based on British traditions of common law India main proponent Sharia Practised in Islamic nations Code of living Sharia finance Civil law Japan Many South east Asian countries China One of the oldest legal traditions in the world Impact of communism Rule of law versus rule by law

Common law in South Asia

Based on British traditions of common law

India main proponent

Sharia

Practised in Islamic nations

Code of living

Sharia finance

Civil law

Japan

Many South east Asian countries

China

One of the oldest legal traditions in the world

Impact of communism

Rule of law versus rule by law

Investment Vehicles Tax holidays relevant in determining investment structure Joint venture Generic term encompassing different kinds of partnership arrangements Aims to bring together 2 or more parties with common goal but different organizational strengths to commence or continue venture Significant in India due to regulatory restrictions, social or geographic needs Wholly-owned vehicles Subsidiary Project office Branch

Tax holidays relevant in determining investment structure

Joint venture

Generic term encompassing different kinds of partnership arrangements

Aims to bring together 2 or more parties with common goal but different organizational strengths to commence or continue venture

Significant in India due to regulatory restrictions, social or geographic needs

Wholly-owned vehicles

Subsidiary

Project office

Branch

IP Regulation in India India member of WTO and signatory to TRIPS agreement Copyright, patent and trademark protection Copyright Act reflects Berne Convention on Copyrights Indian Patents Act compliant with TRIPS Trademarks registered under Trademark Act Licenses have been granted to drugs with similar trademarks No specific trade secrecy laws

India member of WTO and signatory to TRIPS agreement

Copyright, patent and trademark protection

Copyright Act reflects Berne Convention on Copyrights

Indian Patents Act compliant with TRIPS

Trademarks registered under Trademark Act

Licenses have been granted to drugs with similar trademarks

No specific trade secrecy laws

IP Protection in India Pharmaceutical patents Both product and process patent Pharma companies need to obtain licenses from original drug manufacturers May change R&D focus Compulsory licensing if the patent does not meet the reasonable requirements of the public at a reasonable price Data protection clauses to comply with TRIPS on protection of undisclosed information Useful for protecting undisclosed test data submitted to regulatory bodies Data exclusivity is important element of IP protection

Pharmaceutical patents

Both product and process patent

Pharma companies need to obtain licenses from original drug manufacturers

May change R&D focus

Compulsory licensing if the patent does not meet the reasonable requirements of the public at a reasonable price

Data protection clauses to comply with TRIPS on protection of undisclosed information

Useful for protecting undisclosed test data submitted to regulatory bodies

Data exclusivity is important element of IP protection

Dispute Resolution Robust judicial system Delays due to backlog Various trade agreements with US, UK, Japan, China to protect investments Agreement provide protection against acts like expropriation and provide dispute resolution procedures between investors and host state Arbitration and Conciliation Act based on Model Law on International Commercial Arbitration No specific bilateral arbitration treaty or agreement

Robust judicial system

Delays due to backlog

Various trade agreements with US, UK, Japan, China to protect investments

Agreement provide protection against acts like expropriation and provide dispute resolution procedures between investors and host state

Arbitration and Conciliation Act based on Model Law on International Commercial Arbitration

No specific bilateral arbitration treaty or agreement

Best Practices Calculated risks Understand nature of IP rights and protection available Ensure adequate registration of IP Strong IP violation and dispute resolution clauses in contracts IP audit Employment contracts

Calculated risks

Understand nature of IP rights and protection available

Ensure adequate registration of IP

Strong IP violation and dispute resolution clauses in contracts

IP audit

Employment contracts

Questions

From Research to Revenue IV: Capturing Business Opportunities in Asia From Research to Revenue IV: Capturing Business Opportunities in Asia

From Research to Revenue IV: Capturing Business Opportunities in Asia International Commercial Collaborations: Moves for Success Moderator: David Shindler, BioDiscovery Toronto Stuart Wilson, ISTPCanada Adi Treasurywala, Arrowcan Partners Yu Zhang, CAPRA International Christopher Paige, Shanghai-Toronto Institute for Health Research

Biomedical Industry in China Yu Zhang CAPRA International December 3, 2008

Here’s What I Will Cover Today Current scenario of China’s biopharma industry and underlying reasons Industry trends and what are shaping them Examples of international collaborations

Current scenario of China’s biopharma industry and underlying reasons

Industry trends and what are shaping them

Examples of international collaborations

China is a Rapidly Growing Biopharma Producer and Market … >20% growth during 2001-05 to >$3bio; World 4 th largest vaccine market Home to >400 biopharmaceutical manufacturers incl. 114 for genetically engineered drugs and 28 for vaccines Driven by government policies: Huge increase in government investment: $100mio in 2001 -> $1.2bio in 2005 Strong promotion of product development in China by foreign companies Sources: Biopharm International, Mar07; BioSpectrum Asia, Nov08; Sarah E Frew et al, Nature Biotechnology, Jan08

>20% growth during 2001-05 to >$3bio; World 4 th largest vaccine market

Home to >400 biopharmaceutical manufacturers incl. 114 for genetically engineered drugs and 28 for vaccines

Driven by government policies:

Huge increase in government investment: $100mio in 2001 -> $1.2bio in 2005

Strong promotion of product development in China by foreign companies

… Even Though It Represents Only 7% of Global Market In the past, limited innovative capabilities and funding support for R&D Result: 90% of market is biogenerics However, CAGR is projected 22% during 2005-2010 to reach $10.3bio Sources: Biopharm International, Mar07; Sarah E Frew et al, Nature Biotechnology, Jan08

In the past, limited innovative capabilities and funding support for R&D

Result: 90% of market is biogenerics

However, CAGR is projected 22% during 2005-2010 to reach $10.3bio

Government Has Been Strongly Driving Innovation R&D policies and support have resulted in: Having commercialized world’s 1 st licensed gene therapy drugs: Collaboration between Sunway and Genzyme Developing leading-edge stem cell therapies Shanghai Genon Bio-Engineering Developing novel therapies to treat both locally and globally relevant diseases: Tianjin FusoGene’s HIV inhibitor granted US patent Sources: Websites; Sarah E Frew et al, Nature Biotechnology, Jan08

R&D policies and support have resulted in:

Having commercialized world’s 1 st licensed gene therapy drugs:

Collaboration between Sunway and Genzyme

Developing leading-edge stem cell therapies

Shanghai Genon Bio-Engineering

Developing novel therapies to treat both locally and globally relevant diseases:

Tianjin FusoGene’s HIV inhibitor granted US patent

Continuous Government Commitment to Biotech Leap Forward Biomedicine emphasized in the 11 th Five-Year Plan of government (2006-2010) Government investment will be $8.8bio by 2010 Principal Objectives: To develop and commercialize 10-15 innovative drugs and vaccines with Chinese owned IP rights To market 5 chemical synthetic finished drugs to western countries by 2010 To foster 5 large-scale pharma groups, to promote 10 large distributors , and to help 5 domestic pharma evolve into international enterprises Source: Biopharm International, Mar07; BioSpectrum Asia, Nov08

Biomedicine emphasized in the 11 th Five-Year Plan of government (2006-2010)

Government investment will be $8.8bio by 2010

Principal Objectives:

To develop and commercialize 10-15 innovative drugs and vaccines with Chinese owned IP rights

To market 5 chemical synthetic finished drugs to western countries by 2010

To foster 5 large-scale pharma groups, to promote 10 large distributors , and to help 5 domestic pharma evolve into international enterprises

Companies Have Benefited From Government-Supported Labs Genetically engineered vaccines: Sinovac Immunologic diagnostic reagents: Shanghai Medicilon Pharmacogenomic and proteomic screening: Shanghai Genomics QC technology in TCM industry: Shenzhen Tongjitang Pharmaceutical Antibody drugs: Suzhou YES Biotech Laboratories Medical implant devices Source: Notification from China’s National Development and Reform Commission (NDRC), Oct07; Company websites

Genetically engineered vaccines: Sinovac

Immunologic diagnostic reagents: Shanghai Medicilon

Pharmacogenomic and proteomic screening: Shanghai Genomics

QC technology in TCM industry: Shenzhen Tongjitang Pharmaceutical

Antibody drugs: Suzhou YES Biotech Laboratories

Medical implant devices

Significant Government Support in Other Biotech Research Areas Breeding for endangered herbs Molecular crop breeding Cellular crop breeding Forest tree breeding Animal breeding Chemical applications on biomass Veterinary biological products Crop transgenic breeding Development and safety of biologic feed

Breeding for endangered herbs

Molecular crop breeding

Cellular crop breeding

Forest tree breeding

Animal breeding

Chemical applications on biomass

Veterinary biological products

Crop transgenic breeding

Development and safety of biologic feed

Increasing Numbers of ‘Sea-Turtles’ Mean More International Collaborations Shanghai Genomics and Gene Networks International Shenzhen Chipscreen Biosciences and HUYA Bioscience International in San Diego Mindray Bio-Medical’s acquisition of DataScope business June 3-4 th : ChinaBio Partnering Forum in Shanghai: www.chinabiollc.com

Shanghai Genomics and Gene Networks International

Shenzhen Chipscreen Biosciences and HUYA Bioscience International in San Diego

Mindray Bio-Medical’s acquisition of DataScope business

June 3-4 th : ChinaBio Partnering Forum in Shanghai: www.chinabiollc.com

China is Open for Biopharma Business! “ Chinese biopharma enterprises are looking forward to more collaboration with the world’s leading biopharma institutions and companies. We expect to achieve a win-win situation with our global partners. The Chinese biopharmaceutical industry is ready to make significant contributions to global disease prevention and healthcare.” - Ms. Lifeng Wang, CEO of China National Biotech Group (CNBG), at the 1 st International China Biopharmaceutical Symposium (ICBPS), Beijing, Dec06

“ Chinese biopharma enterprises are looking forward to more collaboration with the world’s leading biopharma institutions and companies. We expect to achieve a win-win situation with our global partners. The Chinese biopharmaceutical industry is ready to make significant contributions to global disease prevention and healthcare.”

- Ms. Lifeng Wang, CEO of China National Biotech Group (CNBG), at the 1 st International China Biopharmaceutical Symposium (ICBPS), Beijing, Dec06

UHN China Strategy Christopher Paige, PhD Vice President, Research University Health Network Research to Revenue December 3, 2008

UHN Global Ventures “ to seek preferred academic and commercial partnerships” Research Planning

Enhance Drug Development Capacity Build Clinical Research/Trial Capacity Extend Global Reach WHY?

Enhance Drug Development Capacity

Build Clinical Research/Trial Capacity

Extend Global Reach

STRUCTURE UHN Shanghai Incorporated in China as a WFOE UHN Shanghai CRO (Zhangjiang HT Park)

Profit expectations A culture of “work - arounds” Fast changing regulatory environment Challenges

Service/development model Get to know the Regulators Hire good advisors Solutions 关系

Thank You 谢 谢

AN OVERVIEW OF ISTPCANADA December 3, 2008 Stuart Wilson, ISTPCanada

Background International S&T Partnership Program $20 Million Program of Department of Foreign Affairs and International Trade to foster international S&T partnerships Target Countries: India, China, Brazil and Israel Israel component delivered by existing Canada-Israel Industrial R&D Foundation (CIIRDF) India, China and Brazil components to be delivered through non-governmental organizations

International S&T Partnership Program

$20 Million Program of Department of Foreign Affairs and International Trade to foster international S&T partnerships

Target Countries: India, China, Brazil and Israel

Israel component delivered by existing Canada-Israel Industrial R&D Foundation (CIIRDF)

India, China and Brazil components to be delivered through non-governmental organizations

ISTPCanada Overview Established - January, 2007 Mandate – to promote and facilitate international R&D partnerships involving Canadian companies and research organizations Primary Activity - Implementing the funded program components of bilateral S&T agreements through counterpart organizations in partner countries Clients – companies, academic institutes, research institutes and other institutes (Crown agencies may participate but cannot be recipient of funding) Supported activities - Collaborative R&D Projects and Partnership Development Activities Principles – S&T excellence, shared benefits, economic returns to both countries, symmetry, protection of IP, respect of local laws

Established - January, 2007

Mandate – to promote and facilitate international R&D partnerships involving Canadian companies and research organizations

Primary Activity - Implementing the funded program components of bilateral S&T agreements through counterpart organizations in partner countries

Clients – companies, academic institutes, research institutes and other institutes (Crown agencies may participate but cannot be recipient of funding)

Supported activities - Collaborative R&D Projects and Partnership Development Activities

Principles – S&T excellence, shared benefits, economic returns to both countries, symmetry, protection of IP, respect of local laws

Internal Partnerships Provinces: Alberta & British Columbia in place Ontario & Quebec in development Industrial Research Assistance Program (active) Ontario Centres of Excellence (active) Western Economic Diversification (active) Sustainable Development Technology Canada The Canadian Institutes of Health Research The Atlantic Canada Opportunities Agency Federal Science-based Departments and agencies

Provinces:

Alberta & British Columbia in place

Ontario & Quebec in development

Industrial Research Assistance Program (active)

Ontario Centres of Excellence (active)

Western Economic Diversification (active)

Sustainable Development Technology Canada

The Canadian Institutes of Health Research

The Atlantic Canada Opportunities Agency

Federal Science-based Departments and agencies

The Basic Approach Synchronize application process with the implementing organization in the partner country, to the greatest extent possible Common calls for proposals will be issued and syncronization of approval processes maximized; and Final authority for funding rests with national implementing organizations but a Yes/Yes decision is required before proceeding.

Synchronize application process with the implementing organization in the partner country, to the greatest extent possible

Common calls for proposals will be issued and syncronization of approval processes maximized; and

Final authority for funding rests with national implementing organizations but a Yes/Yes decision is required before proceeding.

Collaborative R&D Projects ~80% of ISTP program funds Industry participation essential Commercialization plan important element of proposals Academia and R&D Institutes participation encouraged and may lead project Exchange of young researchers also encouraged Maximum contribution by ISTPCanada is $600,000 Contribution up to 50% Canadian share of eligible costs Average project duration 1-3 years Number of projects funded each call-for-proposals is subject to available funding

~80% of ISTP program funds

Industry participation essential

Commercialization plan important element of proposals

Academia and R&D Institutes participation encouraged and may lead project

Exchange of young researchers also encouraged

Maximum contribution by ISTPCanada is $600,000

Contribution up to 50% Canadian share of eligible costs

Average project duration 1-3 years

Number of projects funded each call-for-proposals is subject to available funding

Collaborative R&D Projects Key Criteria: Scientific merits and degree of innovation inherent in the product/service developed Business opportunity and capacity for commercial success Capacity of participants to manage and conduct the project, including commercialization thus leading to clear benefits to both countries Non-government funding minimum of 25%

Key Criteria:

Scientific merits and degree of innovation inherent in the product/service developed

Business opportunity and capacity for commercial success

Capacity of participants to manage and conduct the project, including commercialization thus leading to clear benefits to both countries

Non-government funding minimum of 25%

Application and Review Process Competitive Process Expression of Interest (EOI in India but not in China) Invitation for full proposal submission Parallel proposal evaluations in each country: yes/yes required At ISTPCanada - Expert assessment - Advisory Committee recommendation - Joint project approval - ISTPCanada Board approval

Competitive Process

Expression of Interest (EOI in India but not in China)

Invitation for full proposal submission

Parallel proposal evaluations in each country: yes/yes required

At ISTPCanada

- Expert assessment

- Advisory Committee recommendation

- Joint project approval

- ISTPCanada Board approval

Partnership Development Activities ~20% of program funds Joint cost-shared activities such as workshops, partnering missions, seminars, conferences, symposia, exchanges, and other technology partnership events Industry participation encouraged Objective to form extended R&D collaborations competitive calls and internally generated Up to $25,000 or 50% of eligible Canadian costs

~20% of program funds

Joint cost-shared activities such as workshops, partnering missions, seminars, conferences, symposia, exchanges, and other technology partnership events

Industry participation encouraged

Objective to form extended R&D collaborations

competitive calls and internally generated

Up to $25,000 or 50% of eligible Canadian costs

China Update First CFP September, 2007 135 Expressions of Interest 47 full proposals invited 8 projects announced May, 2008 Second CFP September 2008 170+ Expressions of Interest 38 full proposals invited Partnership Development Activities 15 completed or approved

First CFP September, 2007

135 Expressions of Interest

47 full proposals invited

8 projects announced May, 2008

Second CFP September 2008

170+ Expressions of Interest

38 full proposals invited

Partnership Development Activities

15 completed or approved

India Update First CFP Launched October, 2007 67 Expressions of Interest received 29 Full proposals invited 8 projects approved For Partnership Development Activities (PDA) Open Call for Proposals – 3 month turn-around 3 PDAs being developed Second CFP September (Biosciences) 20+ Expressions of Interest Partnership Development Activites 3 completed or approved

First CFP Launched October, 2007

67 Expressions of Interest received

29 Full proposals invited

8 projects approved

For Partnership Development Activities (PDA)

Open Call for Proposals – 3 month turn-around

3 PDAs being developed

Second CFP September (Biosciences)

20+ Expressions of Interest

Partnership Development Activites

3 completed or approved

Contacts www.istpcanada.ca Bharat Rudra – Country Manager, India [email_address] Stacy Chew – Country Manager, China [email_address]

www.istpcanada.ca

Bharat Rudra – Country Manager, India

[email_address]

Stacy Chew – Country Manager, China

[email_address]

From Research to Revenue IV: Capturing Business Opportunities in Asia From Research to Revenue IV: Capturing Business Opportunities in Asia

From Research to Revenue IV: Capturing Business Opportunities in Asia Adventures in Emerging Markets Andrea Mandel-Campbell

From Research to Revenue IV: Capturing Business Opportunities in Asia From Research to Revenue IV: Capturing Business Opportunities in Asia

From Research to Revenue IV: Capturing Business Opportunities in Asia Mississauga: Canada's 3rd Largest Life Sciences Cluster Larry Petovello, City of Mississauga

From Research to Revenue IV: Capturing Business Opportunities in Asia From Research to Revenue IV: Capturing Business Opportunities in Asia

From Research to Revenue IV: Capturing Business Opportunities in Asia Strategic Case Studies Moderator: Joel Cheng, XPhase Pharmaceuticals Inc. Bin Huang, WEX Pharmaceuticals Fulong Qiao, Beijing Farmunity Inc. Sean Thompson, YM Biosciences

From Research to Revenue IV Capturing Business Opportunities in Asia December 3, 2008 Developing a new class of non-opioid analgesics for treatment of pain by Bin Huang, President & CEO

OVERVIEW www.wexpharma.com Phase 3 clinical trial: Tectin for refractory cancer pain N ew class of non-opioid analgesics Clinical trials in Canada since 2000 A Canadian public company since 1992 – TSX:WXI Management and development teams in Vancouver and Montreal Manufacture plant in Nanning, China $20 million investment from CK Life Sciences Deal closed October 2007, provides funding for 2 years Rebuild management team

Phase 3 clinical trial: Tectin for refractory cancer pain

N ew class of non-opioid analgesics

Clinical trials in Canada since 2000

A Canadian public company since 1992 – TSX:WXI

Management and development teams in Vancouver and Montreal

Manufacture plant in Nanning, China

$20 million investment from CK Life Sciences

Deal closed October 2007, provides funding for 2 years

Rebuild management team

The Asia Connection – WEX experience Origin of Company – Hong Kong Initial source of technology – China API supply – 25 staff manufacture plant in Nanning, China New major investor – CK Life Sciences Int’l, HQ in Hong Kong

Origin of Company – Hong Kong

Initial source of technology – China

API supply – 25 staff manufacture plant in Nanning, China

New major investor – CK Life Sciences Int’l, HQ in Hong Kong

Opportunities Cost of R&D Access to larger pools of patients Access to capital An alternative source Access to large and rapidly-growing market Asian prevalent diseases Inexpensive medicines Diagnostic tools and services

Cost of R&D

Access to larger pools of patients

Access to capital

An alternative source

Access to large and rapidly-growing market

Asian prevalent diseases

Inexpensive medicines

Diagnostic tools and services

Considerations A constantly changing environment Know the rules and culture Virulent competition, pricing pressure Government support for SOE vs. WFOE Government – can’t rely on it, can’t defy it Local partner is critical Trusted advisor is essential Mind your store - feet on ground Hong Kong and Singapore are good gateways Watch your IP Get paid upfront

A constantly changing environment

Know the rules and culture

Virulent competition, pricing pressure

Government support for SOE vs. WFOE

Government – can’t rely on it, can’t defy it

Local partner is critical

Trusted advisor is essential

Mind your store - feet on ground

Hong Kong and Singapore are good gateways

Watch your IP

Get paid upfront

Examples www.crownbio.com – CRO www.wuxipharmatech.com – CMO www.simcere.com – Pharma www.caprainc.com – Partnerships www.asialife.com – Venture consulting

www.crownbio.com – CRO

www.wuxipharmatech.com – CMO

www.simcere.com – Pharma

www.caprainc.com – Partnerships

www.asialife.com – Venture consulting

Dr. Fulong Qiao Beijing Farmunity Inc. December 3, 2008 Integrated Eco-Dairy Corporation (IEDC) Model

Dr. Fulong Qiao

Beijing Farmunity Inc.

December 3, 2008

Outline Best safe foods market in the world Marketing strategy of safe foods in China Challenging issues of Chinese dairy Milestones of Fulong’s business in China Highlights of integrated dairy producing technology system (IDPTS) Integrated eco-dairy corporation (IEDC) model Strategies on development Summary

Best safe foods market in the world

Marketing strategy of safe foods in China

Challenging issues of Chinese dairy

Milestones of Fulong’s business in China

Highlights of integrated dairy producing technology system (IDPTS)

Integrated eco-dairy corporation (IEDC) model

Strategies on development

Summary

1. Best safe foods market in the World Facts in Chinese Agriculture: China has 10% of arable lands vs. 20% of population in the World. Lack of standardized production and economic land scale. China has 250 million households (farms). Each household has only 1 Acre arable land in average. Farming is more and more relaying on chemicals. 35% chemical fertilizers in the world are used in China. Pesticides, herbicides, hormones and antibiotics are widely used. Niche Market of Safe Foods: Right now, people pay more attention on safe foods than education, social warfare, environmental pollution and employment. Limited choices of safe foods and 100 – 300% of premium. 6% of families have more than 60% of the total assets in China.

Facts in Chinese Agriculture:

China has 10% of arable lands vs. 20% of population in the World.

Lack of standardized production and economic land scale.

China has 250 million households (farms).

Each household has only 1 Acre arable land in average.

Farming is more and more relaying on chemicals.

35% chemical fertilizers in the world are used in China.

Pesticides, herbicides, hormones and antibiotics are widely used.

Niche Market of Safe Foods:

Right now, people pay more attention on safe foods than education, social warfare, environmental pollution and employment.

Limited choices of safe foods and 100 – 300% of premium.

6% of families have more than 60% of the total assets in China.

2. Strategy of safe food marketing in China Using superior dairy products to establish niche safe food marketing network: Dairy products are one of the most popular foods for those consumers with higher family incomes. Superior dairy products are rare in China. In current markets, liquid milk products with reasonable good quality have at least 150% of premium. Logistic cost is reasonable for directly selling superior dairy products with cold chain systems. Adding on other safe foods to the established marketing network: Importing and marketing safe foods and feed Integrating existing producers to produce high quality animal products, vegetables, special superior grains and fruits.

Using superior dairy products to establish niche safe food marketing network:

Dairy products are one of the most popular foods for those consumers with higher family incomes.

Superior dairy products are rare in China.

In current markets, liquid milk products with reasonable good quality have at least 150% of premium.

Logistic cost is reasonable for directly selling superior dairy products with cold chain systems.

Adding on other safe foods to the established marketing network:

Importing and marketing safe foods and feed

Integrating existing producers to produce high quality animal products, vegetables, special superior grains and fruits.

3. Challenging issues of Chinese Dairy Overall poor dairy management Low quality products Unsustainable dairy industry

Overall poor dairy management

Low quality products

Unsustainable dairy industry

3.1 Overall poor dairy management Lack of practical dairy barn design Cows are directly lying on the hard floor. Cows are suffering strong cold wind in winter and serious heat stress in summer. Lack of good water supply system. Lack of calving pens. Poorly constructed silage buck silos. Lack of high quality forage (feeding cows like pigs) Inferior genetics, lack of systematic breeding program Poor managements of disease control, untrained labor and milking unsanitary Extremely high incidences of mastitis, lameness and reproduction infections Heavily contaminated raw milk Serious bacteria contamination: millions/ml Serious issues of adulterated milk Antibiotic contamination

Lack of practical dairy barn design

Cows are directly lying on the hard floor.

Cows are suffering strong cold wind in winter and serious heat stress in summer.

Lack of good water supply system.

Lack of calving pens.

Poorly constructed silage buck silos.

Lack of high quality forage (feeding cows like pigs)

Inferior genetics, lack of systematic breeding program

Poor managements of disease control, untrained labor and milking unsanitary

Extremely high incidences of mastitis, lameness and reproduction infections

Heavily contaminated raw milk

Serious bacteria contamination: millions/ml

Serious issues of adulterated milk

Antibiotic contamination

3.2 Poor quality products 85 |135-150 72-75 |135 Processing temperature ( o C) >30% (before 2007) No Reconstituted milk ？ 5 – 10% of sale revenue Little Advertisements 20 - 40% 10% Package cost (percentage of retail price) Low Superior Nutrient value >16 | 4 -15 >15 | 2-5 Processing time (seconds) China Advanced Countries Criteria

3.3 Unsustainable dairy industry Not win-win biz model of ‘Dragonhead Processors + Milking Stations + Farmers’ Farmers Milking Stations Processors Small Poor facility Over-heat milk Lack of organization Poor management High package cost Feed cows as pigs Disease spreading site High ad. cost Poor disease control Highly contaminated milk Cheating concepts Inferior genetic Making money by adulteration High risk and low return Helpless Unsustainable development, low quality competitions

Not win-win biz model of ‘Dragonhead Processors + Milking Stations + Farmers’

Farmers Milking Stations Processors

Small Poor facility Over-heat milk

Lack of organization Poor management High package cost Feed cows as pigs Disease spreading site High ad. cost

Poor disease control Highly contaminated milk Cheating concepts

Inferior genetic Making money by adulteration

High risk and low return

Helpless

Unsustainable development, low quality competitions

4. Milestones of Fulong’s business in China 2004-2005: Integrated dairy producing technology system (IDPTS) had been developed, which was officially evaluated on June 6, 2006, Beijing. Dairy producing studies had been conducted across China. 2006-2007: The first cooperative dairy farm was accomplished in April’07, Huhhot. The IDPTS had been implemented in Beijing, Hebei and Inner Mongolia. 2008: The kernel IEDC model is initiated in Beijing. Superior dairy products will be produced and marketed in Beijing.

2004-2005:

Integrated dairy producing technology system (IDPTS) had been developed, which was officially evaluated on June 6, 2006, Beijing.

Dairy producing studies had been conducted across China.

2006-2007:

The first cooperative dairy farm was accomplished in April’07, Huhhot.

The IDPTS had been implemented in Beijing, Hebei and Inner Mongolia.

2008:

The kernel IEDC model is initiated in Beijing.

Superior dairy products will be produced and marketed in Beijing.

Examples of the innovative technologies of the IDPTS Practical achievements in Beijing, Hebei and Inner Mongolia 5. Highlights of the IDPTS

Examples of the innovative technologies of the IDPTS

Practical achievements in Beijing, Hebei and Inner Mongolia

Feeding cows with high quality and low cost forage based rations Forage producing cooperatives Heavy machinery operation Less labors and high efficiency High quality and low cost forage 5.1 Examples of the innovative technologies of the IDPTS

Feeding cows with high quality and low cost forage based rations

Forage producing cooperatives

Heavy machinery operation

Less labors and high efficiency

High quality and low cost forage

Comfort and clean bedding systems 5.1 Examples of the innovative technologies of the IDPTS

Comfort and clean bedding systems

5.2 Practical achievements of implementing the IDPTS After 3 months After 3 months

Increase milk yield 20 – 50% Increase milk price with high quality Double the longevity of cows Added profit is about 4000 – 9000 RMB per lactating cow per year 5.2 Practical achievements of implying the IDPTS

Increase milk yield 20 – 50%

Increase milk price with high quality

Double the longevity of cows

Added profit is about 4000 – 9000 RMB per lactating cow per year

6. Integrated Eco-Dairy Corporation (IEDC) Model Introduction of IEDC Model “ N+1”Kernel IEDC Model

Introduction of IEDC Model

“ N+1”Kernel IEDC Model

6.1 Introduction of IEDC Model Integration from developing forage producing cooperatives, revising and managing existing dairy farms, OEM milk processing, and direct marketing. 100% well controlled quality assurance system. Loyal consumers. Forage producing cooperatives Exploring economics in scale by using heavy machinery instead of traditional labor intensive farming. Producing high quality and low cost forage. Revising and managing existing larger dairy farms Minimizing capital investment and dairy farming risks. Healthy cows & superior raw milk. OEM milk processing Minimizing capital investment and production cost by using existing plants. Direct marketing high quality dairy products with reasonable prices.

Integration from developing forage producing cooperatives, revising and managing existing dairy farms, OEM milk processing, and direct marketing.

100% well controlled quality assurance system.

Loyal consumers.

Forage producing cooperatives

Exploring economics in scale by using heavy machinery instead of traditional labor intensive farming.

Producing high quality and low cost forage.

Revising and managing existing larger dairy farms

Minimizing capital investment and dairy farming risks.

Healthy cows & superior raw milk.

OEM milk processing

Minimizing capital investment and production cost by using existing plants.

Direct marketing high quality dairy products with reasonable prices.

Forage Eco-Producing Cooperative Forage Eco-Producing Cooperative Forage Eco-Producing Cooperative Forage Eco-Producing Cooperative High quality forage based rations Comfort bedding systems Sexed Semen & Embryo Transfer Advanced Milking Facility TMR Supply Facility Waste Management Semi-quarantine disease control Regional Centre Management & Service Centre OEM Dairy Processing Dairy Farm Dairy Farm Dairy Farm Dairy Farm 6.2“N+1”Kernel IEDC Model

7. Development strategies The primary goals are to fulfill the kernel IEDC model in Beijing between 2008 – 2010. The number of lactating cows is 5,000. Producing, processing and marketing 100 tones of milk a day. Serve 300,000 – 400,000 consumers with memberships. The optimal goals are to supply other superior foods to those membership consumers by importing and integrating existing producers and processers.

The primary goals are to fulfill the kernel IEDC model in Beijing between 2008 – 2010.

The number of lactating cows is 5,000.

Producing, processing and marketing 100 tones of milk a day.

Serve 300,000 – 400,000 consumers with memberships.

The optimal goals are to supply other superior foods to those membership consumers by importing and integrating existing producers and processers.

8. Summary Integrated dairy producing technology system (IDPTS) Minimize the technical risks Produce superior milk Maximize profits Establishing direct-sale marketing network by using IEDC model Overcome all of challenging issues that farmers and consumers are facing. Optimize the interests of farmers, local governments, consumers and investors Marketing wide range of safe foods produced IEDC model will be multiplied in other sectors. High return, which can satisfy all of the participants. Good for people, nature and society.

Integrated dairy producing technology system (IDPTS)

Minimize the technical risks

Produce superior milk

Maximize profits

Establishing direct-sale marketing network by using IEDC model

Overcome all of challenging issues that farmers and consumers are facing.

Optimize the interests of farmers, local governments, consumers and investors

Marketing wide range of safe foods produced

IEDC model will be multiplied in other sectors.

High return, which can satisfy all of the participants.

Good for people, nature and society.

advancing drugs effectively Q4/2008 Sean Thompson VP Corporate Development Research to Revenue IV Mississauga Living Arts Centre December 3, 2008 S. Korea Japan Australia Singapore Indonesia EU USA Canada

Safe Harbor Statement This presentation may contain forward-looking statements, which reflect the Company's current expectation regarding future events. These forward-looking statements involve risks and uncertainties that may cause actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward-looking statements. Such factors include, but are not limited to, changing market conditions, the successful and timely completion of clinical studies, the establishment of corporate alliances, the impact of competitive products and pricing, new product development, uncertainties related to the regulatory approval process and other risks detailed from time to time in the Company's ongoing quarterly and annual reporting. Certain of the assumptions made in preparing forward-looking statements include but are not limited to the following: that nimotuzumab will continue to demonstrate a competitive safety profile in ongoing and future clinical trials; that AeroLEF ® will continue to generate positive efficacy and safety data in future clinical trials; and that YM and its various partners will complete their respective clinical trials within the timelines communicated in this release. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

This presentation may contain forward-looking statements, which reflect the Company's current expectation regarding future events. These forward-looking statements involve risks and uncertainties that may cause actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward-looking statements. Such factors include, but are not limited to, changing market conditions, the successful and timely completion of clinical studies, the establishment of corporate alliances, the impact of competitive products and pricing, new product development, uncertainties related to the regulatory approval process and other risks detailed from time to time in the Company's ongoing quarterly and annual reporting. Certain of the assumptions made in preparing forward-looking statements include but are not limited to the following: that nimotuzumab will continue to demonstrate a competitive safety profile in ongoing and future clinical trials; that AeroLEF ® will continue to generate positive efficacy and safety data in future clinical trials; and that YM and its various partners will complete their respective clinical trials within the timelines communicated in this release. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

YM BioSciences is a biopharmaceutical development company engaged in commercialization of products principally for cancer patients. We have 33 employees and are based in Mississauga, Canada Portfolio consists of two late-stage products: Nimotuzumab, a monoclonal antibody for cancer and AeroLEF ® , an opioid product for acute post-operative pain Recent management changes implemented to aggressively advance development of the portfolio Net cash ~$52 million*, Net cash/share ~ $1 – No debt – No impaired assets Burn rate for FY’08 ~$17.5 million** Shares outstanding: ~ 58 million*** / ~ 71 million f.d. NYSE/Alternext – YMI; TSX – YM; AIM - YMBA * Estimate as @ September 30, 2008 ** To increase with clinical activity *** 2.5 million of these are subject to milestones including partnership and Phase III initiation of AeroLEF® Investment Summary

YM BioSciences is a biopharmaceutical development company engaged in commercialization of products principally for cancer patients. We have 33 employees and are based in Mississauga, Canada

Portfolio consists of two late-stage products: Nimotuzumab, a monoclonal antibody for cancer and AeroLEF ® , an opioid product for acute post-operative pain

Recent management changes implemented to aggressively advance development of the portfolio

Net cash ~$52 million*, Net cash/share ~ $1 – No debt – No impaired assets

Burn rate for FY’08 ~$17.5 million**

Shares outstanding: ~ 58 million*** / ~ 71 million f.d.

NYSE/Alternext – YMI; TSX – YM; AIM - YMBA

Uniquely permits patient self-titration of opioids: Fentanyl is first product Soft mist inhalation with an approved nebulizer New management team with established fentanyl development and regulatory experience mandated to partner product AeroLEF ®

Uniquely permits patient self-titration of opioids:

Fentanyl is first product

Soft mist inhalation with an approved nebulizer

New management team with established fentanyl development and regulatory experience mandated to partner product

Clinically demonstrated to be an active drug in multiple tumor types Mechanistically demonstrated to be differentiated from cetuximab (Erbitux ® ) and panitumumab (Vectibix ® ) Being developed by a global consortium of companies Marketed in numerous secondary markets including: India, China, Philippines, Indonesia Nimotuzumab – Affinity-Optimized™ Anti-EGFR mAb

Clinically demonstrated to be an active drug in multiple tumor types

Mechanistically demonstrated to be differentiated from cetuximab (Erbitux ® ) and panitumumab (Vectibix ® )

Being developed by a global consortium of companies

Marketed in numerous secondary markets including:

India, China, Philippines, Indonesia

Med-High EGFR environment (cancer cells): all mAbs bind in the same manner—bivalently 1 Evidence of equivalent therapeutic efficacy of nimotuzumab to higher affinity mAbs (clinical/preclinical) Low EGFR environment (normal cells): high affinity antibodies (cetuximab and panitumumab) bind tightly and monovalently Results in indiscriminate activity and toxicity Nimotuzumab’s affinity optimization results in transient monovalent binding and stable bivalent binding Differentiates between normal and cancer cells 1 Yoshida et al 2008; Tikhomirov et al 2008; van Bueren et al 2008 Nimotuzumab Therapeutic Effect Concentrated at Tumor

Med-High EGFR environment (cancer cells): all mAbs bind in the same manner—bivalently 1

Evidence of equivalent therapeutic efficacy of nimotuzumab to higher affinity mAbs (clinical/preclinical)

Low EGFR environment (normal cells): high affinity antibodies (cetuximab and panitumumab) bind tightly and monovalently

Results in indiscriminate activity and toxicity

Nimotuzumab’s affinity optimization results in transient monovalent binding and stable bivalent binding

Differentiates between normal and cancer cells

Nimotuzumab Affinity-Optimized™ mAb High Affinity anti-EGFR mAbs Activity of Nimotuzumab is Concentrated at Tumor Activity of High Affinity anti-EGFR mAbs is dispersed across all tissues, causing toxicity Tumor (High EGFR) Tumor (High EGFR) Nimotuzumab – Mechanistically Differentiated

1 Information from four completed trials; data collection ongoing. 2 FDA Action Letter, June 2008 3 STEPP trial – 2008 – 29% post-preemptive treatment 4 Erbitux® Package insert. Revised: 11/2008 5 Article in Press: Giro C et al , Radiother Oncol (2008), doi:10.1016/j.radonc.2008.09.007 Erbitux ® and Vectibix ® Have Significant Toxicities NA NA VERY RARE 49% 5 Rad. Dermatitis—Grades 3 and 4 0% 62% 3 VERY RARE 25% 2 Rash - Grades 3 and 4 2% 57% VERY RARE 16% Pruritus 29% 35% 19% 49% 55% 4 87% Erbitux ® plus Radiation 12% 19% 14% Vomiting 9% 21% 14% Constipation 1% 21% 9% Diarrhea 16% 23% 22% Nausea 2% 39% VERY RARE Hypomagnesemia – all grades 6% 90% 9% Rash - All grades BSC Alone Vectibix ® plus BSC Nimotuzumab plus Radiation

Affinity-optimized™ nimotuzumab has potential for significantly improved therapeutic window relative to Erbitux ® and Vectibix ® Lower affinity for normal cells (skin and kidney) vs. Erbitux ®1 No evidence of Grade III/IV kidney toxicity (hypomagnesemia) 2 No evidence of Grade III/IV skin toxicity 2 There is no clinical evidence of serious toxicity in chemoradiation regimens (RT+CisPt) with addition of nimotuzumab With Erbitux ® , 20% treatment discontinuation in combination CisPt/RT regimen previously reported 3 The only anti-EGFR mAb tolerable for chronic use – therapeutic window crucial - and the drug of choice for combination Chemo+RT 1 Internal unpublished data 2 Nimotuzumab integrated global safety database 3 Erbitux® Package Insert Nimotuzumab – Uniquely Positioned Anti-EGFR mAb

Affinity-optimized™ nimotuzumab has potential for significantly improved therapeutic window relative to Erbitux ® and Vectibix ®

Lower affinity for normal cells (skin and kidney) vs. Erbitux ®1

No evidence of Grade III/IV kidney toxicity (hypomagnesemia) 2

No evidence of Grade III/IV skin toxicity 2

There is no clinical evidence of serious toxicity in chemoradiation regimens (RT+CisPt) with addition of nimotuzumab

With Erbitux ® , 20% treatment discontinuation in combination CisPt/RT regimen previously reported 3

The only anti-EGFR mAb tolerable for chronic use – therapeutic window crucial - and the drug of choice for combination Chemo+RT

Clinical Evidence >30 Trials in Ten Tumor Types Overall survival placebo + RT = 8.67 months Nimotuzumab + RT = 16.43 months Interim analysis of 65/80 patients to complete the trial Phase III RT +/- nimotuzumab Glioma GBM Stratum Twenty patients (83%) – CR or PR. The median overall survival (n=24) was 51.7 months. In publication Phase II single-arm 100 and 200 mgs H & N (locally advanced) CR 91% vs. 52% at 17 weeks Marketing Approval by Health Regulatory Authorities in China Randomized Phase II RT +/- nimotuzumab Nasopharyngeal Significant tumor response rates (CR/ORR) compared to RT alone and to CT + RT alone. Marketing Approval by Health Regulatory Authorities in India Multi-modal 4-arm Phase II CT/CRT +/- nimotuzumab H & N Stage III & IVA unresectable (BEST trial) CR+PR+SD 92% vs. 44% OS 7 months vs. 2.5 months Preliminary analysis (EORTC/NCI/AACR October 2008) Randomized Phase II RT +/- nimotuzumab Brain Metastases from NSCLC Substantial radiological responses and meaningful clinical responses in each cohort. Median survival of three cohort equals 60 weeks. ASCO June 2008 & Preliminary data on 2 nd cohort Palliative Phase I/II Single-arm Patients unsuitable for radical therapy NSCLC

Multiple randomized trials ongoing in 2009 DIPG Phase III recruitment completed Adult Glioma Phase III randomized, controlled Pancreatic Phase IIb/IIIa randomized, controlled Europe Gastric Phase II randomized Other indications planned Japan and Korea Brain Metastases (NSCLC) Phase II randomized, controlled Non-Small Cell Lung Phase II randomized, controlled DIPG Phase II Open label North America Nimotuzumab – Path to Approval in Major Markets

DIPG Phase III

recruitment completed

Adult Glioma Phase III

randomized, controlled

Pancreatic Phase IIb/IIIa

randomized, controlled

Gastric

Phase II

randomized

Other indications planned

Brain Metastases (NSCLC)

Phase II

randomized, controlled

Non-Small Cell Lung

Phase II

randomized, controlled

DIPG

Phase II

Open label

Nimotuzumab – Preferential Positioning High Unmet Need – Low 5 Year Survival Large Markets – More than 1 million patients globally Target indications driven by mechanistic and clinical observations 29,000 114,000 171,000 25% Gastric 16,000 14,000 48,000 16% Esophageal 42,000 15,000 98,000 60% H&N 52,000 16,200 71,000 15% Brain Mets (NSCLC) 166,000 52,000 229,000 15% NSCLC 4,800 1,000 12,600 25% Glioblastoma NA Patients Japanese Patients European Patients 5 yr Survival Indication

Nimotuzumab – YM Global Marketing Rights Japan Korea Australia/New Zealand North America Southeast Asia Europe Africa YM BioSciences nimotuzumab marketing rights

Nimotuzumab – Business Development in Asia H&N (06) India Jun-04 India, PK not filed Jul-06 Japan Glioma (08) Indo, Philippines Nov-05 SE Asia not filed Jun-05 S Korea Indication Market Approval Date Territory Licensee

Why Asia? Early revenue for company Additional resources for development Broaden label faster, some conditions endemic in Asia Open minded executives. Less influenced by cross pollination in US and EU companies Broaden company revenue base An excellent method to build Canadian based companies!

Early revenue for company

Additional resources for development

Broaden label faster, some conditions endemic in Asia

Open minded executives. Less influenced by cross pollination in US and EU companies

Broaden company revenue base

An excellent method to build Canadian based companies!

Nimotuzumab Clinical Trials Ongoing trial Completed trial Indication Phase I Phase II Phase III Sponsor Pediatric Diffuse Intrinsic Pontine Glioma Phase III trial reporting mid-2008 Oncoscience AG Adult Glioma Oncoscience AG Pancreatic Cancer Oncoscience AG Head & Neck Cancer YM BioSciences Pediatric Glioma (High Grade) Phase II data submitted to EMEA Oncoscience AG Pancreatic Cancer Oncoscience AG Pediatric Diffuse Intrinsic Pontine Glioma YM BioSciences Colorectal Cancer YM BioSciences Non-Small Cell Lung Cancer YM BioSciences Japanese Safety Study Daiichi-Sankyo Pharmacodynamic Study YM BioSciences Esophageal Cancer CIM / Eurofarma Squamous Cell Carcinoma of the Head & Neck Innogene Kalbiotech Gastric Cancer (Advanced, Recurrent) Daiichi-Sankyo /Kuhnil Pediatric Brain Stem Tumors YM BioSciences Expanded Access Program - USA

YM BioSciences is a biopharmaceutical development company engaged in commercialization of products principally for cancer patients. We have 33 employees and are based in Mississauga, Canada Portfolio consists of two late-stage products: Nimotuzumab, a monoclonal antibody for cancer and AeroLEF ® , an opioid product for acute post-operative pain Recent management changes implemented to aggressively advance development of the portfolio Net cash ~$52 million*, Net cash/share ~ $1 – No debt – No impaired assets Burn rate for FY’08 ~$17.5 million** Shares outstanding: ~ 58 million*** / ~ 71 million f.d. NYSE/Alternext – YMI; TSX – YM; AIM - YMBA * Estimate as @ September 30, 2008 ** To increase with clinical activity *** 2.5 million of these are subject to milestones including partnership and Phase III initiation of AeroLEF® Investment Summary

YM BioSciences is a biopharmaceutical development company engaged in commercialization of products principally for cancer patients. We have 33 employees and are based in Mississauga, Canada

Portfolio consists of two late-stage products: Nimotuzumab, a monoclonal antibody for cancer and AeroLEF ® , an opioid product for acute post-operative pain

Recent management changes implemented to aggressively advance development of the portfolio

Net cash ~$52 million*, Net cash/share ~ $1 – No debt – No impaired assets

Burn rate for FY’08 ~$17.5 million**

Shares outstanding: ~ 58 million*** / ~ 71 million f.d.

NYSE/Alternext – YMI; TSX – YM; AIM - YMBA

advancing drugs effectively S. Korea Japan Australia Singapore Indonesia EU USA Canada

From Research to Revenue IV: Capturing Business Opportunities in Asia From Research to Revenue IV: Capturing Business Opportunities in Asia

From Research to Revenue IV: Capturing Business Opportunities in Asia Impact of Regulations: How They Affect People on the Ground Moderator: John Kelly, MaRS Landing Valerie Bell, Bell Alliances International Ashley Roberts, Cantox Xuefeng Yu, sanofi pasteur Paul Jones, Jones & Company

Bio-Pharmaceutical Regulations in China

China Biotech landscape Biotechnology is one of the seven key technologies for the national science and technology medium- and long-term development plan (2006-2020) Multiple sources of Funding MOST, DOH, NDRC, Local Government S&T Industrial Park attracts most of the new Biotech industries

Biotechnology is one of the seven key technologies for the national science and technology medium- and long-term development plan (2006-2020)

Multiple sources of Funding

MOST, DOH, NDRC, Local Government

S&T Industrial Park attracts most of the new Biotech industries

Distribution of S&T Industrial park

Policies to regulate and promote Biotechnologies Strategy for Biotech and Bio-Industry development 2006-2020 Bio-safety Act Regulations for Human Genetic Resource Management Regulation on Biological Safety administration of Pathogenic Microorganism Laboratories

Strategy for Biotech and Bio-Industry development 2006-2020

Bio-safety Act

Regulations for Human Genetic Resource Management

Regulation on Biological Safety administration of Pathogenic Microorganism Laboratories

Current Status of Biotech Industry in China MNCs move in fast Drug Discovery: R&D Centers + CRO MNCs began to acquire local Biotech Companies: GSK Local Biotech less innovative Biotech > 90% on bio-similar products Weak in “D”: Bioprocess and Development Barrier and less trust to Foreign companies The Status is changing fast MNC’s China strategy Significant amount of new Start-ups by oversea returnees Some local Biotech companies start recruiting top management from oversea.

MNCs move in fast

Drug Discovery: R&D Centers + CRO

MNCs began to acquire local Biotech Companies: GSK

Local Biotech less innovative

Biotech > 90% on bio-similar products

Weak in “D”: Bioprocess and Development

Barrier and less trust to Foreign companies

The Status is changing fast

MNC’s China strategy

Significant amount of new Start-ups by oversea returnees

Some local Biotech companies start recruiting top management from oversea.

Regulatory Challenges Government regulations lag behind the industry’s needs Significant delay for IND and NDA approval Regulatory authorities are mainly from academia, lack of experience to handle the biotech industry needs Lack of coordination between government agencies, unclear roles and responsibilities Different quality standard and interpretation of quality standard Barriers for new biotech products developed outside of China

Government regulations lag behind the industry’s needs

Significant delay for IND and NDA approval

Regulatory authorities are mainly from academia, lack of experience to handle the biotech industry needs

Lack of coordination between government agencies, unclear roles and responsibilities

Different quality standard and interpretation of quality standard

Barriers for new biotech products developed outside of China

Opportunities Strong Support from Government Strategy, Policy, Finance Unique resources: Diseases and Patients Strains, Blood samples, Patients and Subjects, Talent Pool Scientists, Technicians, Logistic manpower Low cost with high efficiency Ph.D and Post-doctor 350-500 Euro/m CRO Animal Test: Rodent, Canine, Monkey, 11 facilities got AAALAC accreditation Genomics, proteomics, pharmacology, pharmacokinetics, toxicology, Pilot, etc. Increasing Medical needs, Future Market 800M Euro in 2007, >30%/year

Strong Support from Government

Strategy, Policy, Finance

Unique resources: Diseases and Patients

Strains, Blood samples, Patients and Subjects,

Talent Pool

Scientists, Technicians, Logistic manpower

Low cost with high efficiency

Ph.D and Post-doctor 350-500 Euro/m

CRO

Animal Test: Rodent, Canine, Monkey, 11 facilities got AAALAC accreditation

Genomics, proteomics, pharmacology, pharmacokinetics, toxicology, Pilot, etc.

Increasing Medical needs, Future Market

800M Euro in 2007, >30%/year

CHINESE FOOD REGULATORY REQUIREMENTS Ashley Roberts, Ph.D. Cantox Health Sciences International From Research to Revenue IV: Capturing Business Opportunities in Asia Mississauga Living Arts Centre, Mississauga, Ontario December 3, 2008

INTRODUCTIONS Great interest in China from food, food ingredient and supplement manufacturers Market expansion Market size Westernization Changing dietary patterns Barrier to market Knowledge of regulations Requirements Previous approvals (JECFA)

Great interest in China from food, food ingredient and supplement manufacturers

Market expansion

Market size

Westernization

Changing dietary patterns

Barrier to market

Knowledge of regulations

Requirements

Previous approvals (JECFA)

CHINESE REGULATIONS Food laws established in 1949 Revised in the 80’s Food hygiene Safety of imported foods Food Hygiene Law finalized in 1995 “To ensure food hygiene, prevent food contamination or harmful substances from injuring human health, safeguard the health of the people and improve physical fitness”.

Food laws established in 1949

Revised in the 80’s

Food hygiene

Safety of imported foods

Food Hygiene Law finalized in 1995

“To ensure food hygiene, prevent food contamination or harmful substances from injuring human health, safeguard the health of the people and improve physical fitness”.

FOOD HYGIENE LAW (1995) Law consists of 9 chapters and 57 articles Hygiene for all foods Food additives Containers Packages Utensils Equipment used for foods Production facilities also covered Covered by national, provincial and municipal governments

Law consists of 9 chapters and 57 articles

Hygiene for all foods

Food additives

Containers

Packages

Utensils

Equipment used for foods

Production facilities also covered

Covered by national, provincial and municipal governments

FOOD HYGIENE LAW (1995) Outlines regulatory requirements for approval of domestic and imported products Food additives Novel foods Functional foods Supplements Individual regulations Health Foods

Outlines regulatory requirements for approval of domestic and imported products

Food additives

Novel foods

Functional foods

Supplements

Individual regulations

FOOD ADDITIVES AND NOVEL FOODS APPROVAL Unique System Positive list published in “Food Additive Hygiene Standard” Requires approval from Ministry of Health (MOH) Testing of food ingredient (analytical) Testing of food ingredient (toxicity) Results must be included in application Overseas, applicants need a representative officer or authorized agent

Unique System

Positive list published in “Food Additive Hygiene Standard”

Requires approval from Ministry of Health (MOH)

Testing of food ingredient (analytical)

Testing of food ingredient (toxicity)

Results must be included in application

Overseas, applicants need a representative officer or authorized agent

HEALTH FOODS Require registration with the State Food and Drug Administration Can carry a health claim No reference to treatment or cure of disease Needs to be sold overseas for a period of 1 year Determine specific testing Examine manufacturing site (GMP) Approval valid for 5 years

Require registration with the State Food and Drug Administration

Can carry a health claim

No reference to treatment or cure of disease

Needs to be sold overseas for a period of 1 year

Determine specific testing

Examine manufacturing site (GMP)

Approval valid for 5 years

CONCLUSIONS Marketing Acceptance Regulatory requirements for supporting safety Testing of materials (analytical/toxicology) Prior approvals required Chinese representative assistance “regulatory acceptance”

Marketing Acceptance

Regulatory requirements for supporting safety

Testing of materials (analytical/toxicology)

Prior approvals required

Chinese representative assistance

“regulatory acceptance”

BOOK CHAPTER CHINESE APPROACH ON REGULATING FOOD ADDITIVES, NOVEL FOODS, FUNCTIONAL FOODS, AND DIETARY SUPPLEMENTS Nutraceuticals and Functional Foods Regulations in the United States and Around the World http://www.elsevier.com/wps/find/bookdescription.cws_home/715494/description#description

CHINESE APPROACH ON REGULATING FOOD ADDITIVES, NOVEL FOODS, FUNCTIONAL FOODS, AND DIETARY SUPPLEMENTS

Nutraceuticals and Functional Foods Regulations in the United States and Around the World http://www.elsevier.com/wps/find/bookdescription.cws_home/715494/description#description

INTELLECTUAL PROPERTY PROTECTION IN CHINA: Best Practices 知识产权的保护在中国 : 最佳做法 Paul Jones Jones & Co. 钟保禄律师事务所 Джоунс и Ко. www.jonesco-law.ca Research to Revenue The Biotechnology Initiative December 3, 2008

简介 - Introduction Many foreigners believe that their intellectual property cannot be protected in China Consequently they are reluctant to register their IP rights in China

Many foreigners believe that their intellectual property cannot be protected in China

Consequently they are reluctant to register their IP rights in China

简介 - Introduction China has IP laws that meet international standards Chinese courts do enforce IP rights, and particularly IP rights held by foreign parties To a large extent the threat to IP from counterfeiters can be costed and managed

China has IP laws that meet international standards

Chinese courts do enforce IP rights, and particularly IP rights held by foreign parties

To a large extent the threat to IP from counterfeiters can be costed and managed

简介 - Introduction - 假冒伪劣 - Counterfeiting “… a tumultuous period in which the rigid hierarchies of colonial times finally dissolved, replaced by the more fluid social order of a democratic commercial society. Self-fashioning and self-advancement slowly became a viable way of life…” Stephen Mihm, A Nation of Counterfeiters , p.24

“… a tumultuous period in which the rigid hierarchies of colonial times finally dissolved, replaced by the more fluid social order of a democratic commercial society. Self-fashioning and self-advancement slowly became a viable way of life…”

Stephen Mihm, A Nation of Counterfeiters , p.24

法院及知识产权的实施 Courts & IP Enforcement Lego Case - 英特莱格公司（ INTERLEGO ． AG ） v. 可高（天津）玩具有限公司 , Beijing 2002 Lego was successful under design patent and copyright law Beijing Higher People’s Court stated: 可高公司的产品 确有抄袭之嫌 ，但同时也应看到英特莱格公司的上述玩具积木块 艺术创作程 度确实 不是很高 ，与典型的实用艺术作品在艺术创作程度上尚有一定差距，一审法院出于平衡利益关系的考虑，作出上述认定是合理的，本院予以支持。 (While the Kegao Company’s products really have the smell of plagiarism , we should also consider that the level of artistic creation in the English Interlego Company’s products is not really very high and there is a certain disparity between it and typical practical works of art. The court of first instance struck a balance a reasonable balance of the interests and we will support it .)

Lego Case - 英特莱格公司（ INTERLEGO ． AG ） v. 可高（天津）玩具有限公司 , Beijing 2002

Lego was successful under design patent and copyright law

Beijing Higher People’s Court stated:

可高公司的产品 确有抄袭之嫌 ，但同时也应看到英特莱格公司的上述玩具积木块 艺术创作程 度确实 不是很高 ，与典型的实用艺术作品在艺术创作程度上尚有一定差距，一审法院出于平衡利益关系的考虑，作出上述认定是合理的，本院予以支持。

(While the Kegao Company’s products really have the smell of plagiarism , we should also consider that the level of artistic creation in the English Interlego Company’s products is not really very high and there is a certain disparity between it and typical practical works of art. The court of first instance struck a balance a reasonable balance of the interests and we will support it .)

简介 – Introduction – 政府 - Government Unitary State – 31 “Provinces” Each level of government can exercise the same powers as the national government if there is no conflict with the laws of a superior level of government Consultative Administration Broad consultations on new laws Reluctance to be the nail that sticks out

Unitary State – 31 “Provinces”

Each level of government can exercise the same powers as the national government

if there is no conflict with the laws of a superior level of government

Consultative Administration

Broad consultations on new laws

Reluctance to be the nail that sticks out

最佳做法 – BEST PRACTICES Register your IP Trademarks - as many classes as possible - develop Chinese character version of mark Patents Do both invention and utility applications Search Chinese language prior art Copyrights Consider registration to improve damage claims

Register your IP

Trademarks

- as many classes as possible

- develop Chinese character version of mark

Patents

Do both invention and utility applications

Search Chinese language prior art

Copyrights

Consider registration to improve damage claims

商标在中国 – Trade-marks in China 麦当劳 – McDONALD’S (mai dang lao) Mai – cover up, bury – 埋 - buy, purchase – 买 - step, stride, advanced in years – 迈 - wheat, a surname – 麦 - sell – 卖 - arteries and veins – 脉

麦当劳 – McDONALD’S (mai dang lao)

Mai – cover up, bury – 埋

- buy, purchase – 买

- step, stride, advanced in years – 迈

- wheat, a surname – 麦

- sell – 卖

- arteries and veins – 脉

商标在中国 – Trade-marks in China 麦当劳 – McDONALD’S (mai dang lao) dang – equal, ought to, just at, work as, deserve, manage, sound of a gong – 当 - keep off, block, a fender, gear of a car – 挡 - political party, the Party (Communist) – 党 - earring, eunuch – 垱 - crotch – 裆 - proper, match, treat as think, that very day, to pawn – 挡 - manure pit – 凼 - loose in morals, a marsh – 荡 - delay – 宕 - outspoken – 谠

麦当劳 – McDONALD’S (mai dang lao)

dang – equal, ought to, just at, work as, deserve, manage, sound of a gong – 当

- keep off, block, a fender, gear of a car – 挡

- political party, the Party (Communist) – 党

- earring, eunuch – 垱

- crotch – 裆

- proper, match, treat as think, that very day, to pawn – 挡

- manure pit – 凼

- loose in morals, a marsh – 荡

- delay – 宕

- outspoken – 谠

商标在中国 – Trade-marks in China 麦当劳 – McDONALD’S (mai dang lao) lao – scoop up from a liquid, get by improper means – 捞 - enclosure for animals, jail – 牢 - work, reward – 劳 - old, tough, dark – 老 - waterlogged – 涝 - bake in a pan – 烙 - kind of farm tool – 耢 - fruit jelly – 酪

麦当劳 – McDONALD’S (mai dang lao)

lao – scoop up from a liquid, get by improper means – 捞

- enclosure for animals, jail – 牢

- work, reward – 劳

- old, tough, dark – 老

- waterlogged – 涝

- bake in a pan – 烙

- kind of farm tool – 耢

- fruit jelly – 酪

商标在中国 – Trade-marks in China 麦当劳 – McDONALD’S – wheat should work Other Possible Names : 卖凼涝 – to sell something that has been waterlogged in a manure pit 买挡捞 - to buy in order to prevent someone scooping something (perhaps improperly)

麦当劳 – McDONALD’S – wheat should work

Other Possible Names :

卖凼涝 – to sell something that has been waterlogged in a manure pit

买挡捞 - to buy in order to prevent someone scooping something (perhaps improperly)

辉瑞 商标的问题 Pfizer’s Trade-mark Problems Pfizer – VIAGRA 最出名的药物 万艾可 ( 伟哥 、威而钢 )

Pfizer – VIAGRA

最出名的药物 万艾可 ( 伟哥 、威而钢 )

最佳做法 – BEST PRACTICES 2. Prepare a Business Plan for China Select what will be made in China carefully – perhaps withhold the most innovative or high-margin products, or separate functions so that no one manufacturer makes the whole product Make sure that your project is economically feasible – for you and potential partners Build monitoring and enforcement costs into your project feasibility plan Know your limit on losses from the project in advance, do a thorough risk analysis

2. Prepare a Business Plan for China

Select what will be made in China carefully – perhaps withhold the most innovative or high-margin products, or separate functions so that no one manufacturer makes the whole product

Make sure that your project is economically feasible – for you and potential partners

Build monitoring and enforcement costs into your project feasibility plan

Know your limit on losses from the project in advance, do a thorough risk analysis

最佳做法 – BEST PRACTICES 2. Prepare a Business Plan for China Pricing and Channels of Distribution For products with broad consumer appeal in China many purchases are made in small retail shops – difficult to monitor and police Consider developing a stripped-down, low-cost version of the product for sale in China

2. Prepare a Business Plan for China

Pricing and Channels of Distribution

For products with broad consumer appeal in China many purchases are made in small retail shops – difficult to monitor and police

Consider developing a stripped-down, low-cost version of the product for sale in China

最佳做法 – BEST PRACTICES 3. Audits – Know What is Going to China What are the key commercial elements? How are they protected? Invention patent utility patent design patent copyright trade secret trademark How valuable are they? Are they older items that have largely become known?

3. Audits – Know What is Going to China

What are the key commercial elements?

How are they protected?

Invention patent

utility patent

design patent

copyright

trade secret

trademark

How valuable are they? Are they older items that have largely become known?

最佳做法 – BEST PRACTICES 4. Find the Right Partner in China Retain advisors experienced in China Conduct searches through networks, look for introductions Attend trade conferences in China, get to know your options and the differences in your industry in China

4. Find the Right Partner in China

Retain advisors experienced in China

Conduct searches through networks, look for introductions

Attend trade conferences in China, get to know your options and the differences in your industry in China

最佳做法 – BEST PRACTICES 4. Find the Right Partner in China – cont’d. Conduct Due Diligence: Insist upon the right to make background checks on key people and the company Conduct checks on the reputation of the local area. Hire outside investigators, and use them Audit the other side - Carefully evaluate any property contributions by your Chinese partner, disputes over property valuation have plagued joint ventures Some prefer partners with foreign trained key personnel

4. Find the Right Partner in China – cont’d.

Conduct Due Diligence:

Insist upon the right to make background checks on key people and the company

Conduct checks on the reputation of the local area.

Hire outside investigators, and use them

Audit the other side - Carefully evaluate any property contributions by your Chinese partner, disputes over property valuation have plagued joint ventures

Some prefer partners with foreign trained key personnel

最佳做法 – BEST PRACTICES 4. Find the Right Partner in China – cont’d. Conduct Due Diligence: Know if there is any state interest in the other party Does the other party need higher authorization to enter into the contract? Does the other party truly own the assets that it is contributing, or does the state still have an interest in the assets – e.g. Danone and the Wahaha trademark – “ 娃哈哈”

4. Find the Right Partner in China – cont’d.

Conduct Due Diligence:

Know if there is any state interest in the other party

Does the other party need higher authorization to enter into the contract?

Does the other party truly own the assets that it is contributing, or does the state still have an interest in the assets – e.g. Danone and the Wahaha trademark – “ 娃哈哈”

最佳做法 – BEST PRACTICES 5. Structure the Deal Carefully License, technology transfer, co-operative joint venture, equity joint venture, WFOE? What is Plan B – if things don’t work out? How to get your money out of China – dividends, payment for services, royalties Withholding taxes on royalties now 10%

5. Structure the Deal Carefully

License, technology transfer, co-operative joint venture, equity joint venture, WFOE?

What is Plan B – if things don’t work out?

How to get your money out of China – dividends, payment for services, royalties

Withholding taxes on royalties now 10%

最佳做法 – BEST PRACTICES 6. Develop a Good Contract General Items Do not use your standard form agreement for North America Consider preparing for enforcement in China with a civil law form of contract in Chinese Do not rely on the other party as to the legal validity of the terms Negotiate in good faith and disclose material facts – required by Article 42 of the Contract Law ( 中华人民共和国合同法 )

6. Develop a Good Contract

General Items

Do not use your standard form agreement for North America

Consider preparing for enforcement in China with a civil law form of contract in Chinese

Do not rely on the other party as to the legal validity of the terms

Negotiate in good faith and disclose material facts – required by Article 42 of the Contract Law ( 中华人民共和国合同法 )

最佳做法 – BEST PRACTICES 6. Develop a Good Contract – cont’d. IP Issues Carefully describe the scope of the grant – for example – territorially what is China? Rights to improvements – remember the restrictions on grantbacks How will access to the IP be controlled, monitored?

6. Develop a Good Contract – cont’d.

IP Issues

Carefully describe the scope of the grant – for example – territorially what is China?

Rights to improvements – remember the restrictions on grantbacks

How will access to the IP be controlled, monitored?

最佳做法 – BEST PRACTICES 6. Develop a Good Contract – cont’d. Non-Competition Provisions Know the provisions of the 劳动合同法 – Labor Contract Law Use side agreements with key personnel Draft the scope of the restrictions with precision Draft the liquidated damages provisions carefully

6. Develop a Good Contract – cont’d.

Non-Competition Provisions

Know the provisions of the 劳动合同法 – Labor Contract Law

Use side agreements with key personnel

Draft the scope of the restrictions with precision

Draft the liquidated damages provisions carefully

最佳做法 – BEST PRACTICES 6. Develop a Good Contract – cont’d. Technicalities: Contract should be in Chinese, or at a minimum, bilingual Identify the Chinese party in Chinese characters, as copied from its certificate of incorporation; translations vary tremendously and Chinese companies often use short forms of their names in Chinese

6. Develop a Good Contract – cont’d.

Technicalities:

Contract should be in Chinese, or at a minimum, bilingual

Identify the Chinese party in Chinese characters, as copied from its certificate of incorporation;

translations vary tremendously and Chinese companies often use short forms of their names in Chinese

最佳做法 – BEST PRACTICES 6. Develop a Good Contract – cont’d. Technicalities: Specify exact terms of payment and performance Ensure that that each page is signed and that the contract is properly signed and sealed. Are two signatures required? Make provision for inspections and audits, possibly including for the components or inputs, and use them

6. Develop a Good Contract – cont’d.

Technicalities:

Specify exact terms of payment and performance

Ensure that that each page is signed and that the contract is properly signed and sealed. Are two signatures required?

Make provision for inspections and audits, possibly including for the components or inputs, and use them

最佳做法 – BEST PRACTICES 6. Develop a Good Contract – cont’d. Law, Forum and Venue: Generally China does not enforce foreign judgments, U.S. judgments in particular Specify a choice of law that matches your exit strategy If you are based outside of China, consider using arbitration, China is a party to the New York Convention on Arbitral Awards

6. Develop a Good Contract – cont’d.

Law, Forum and Venue:

Generally China does not enforce foreign judgments, U.S. judgments in particular

Specify a choice of law that matches your exit strategy

If you are based outside of China, consider using arbitration, China is a party to the New York Convention on Arbitral Awards

最佳做法 – BEST PRACTICES 6. Develop a Good Contract – cont’d. Law, Forum and Venue: Be careful in choice of arbitrator and arbitration rules, CIETAC has had serious problems recently Consider negotiating for the right of discovery - alternatively make plans to collect and retain written records Alternatively chose a foreign law, such as Hong Kong, but accept a Chinese court. Chinese courts will try to enforce foreign laws when the parties specify in the contract

6. Develop a Good Contract – cont’d.

Law, Forum and Venue:

Be careful in choice of arbitrator and arbitration rules, CIETAC has had serious problems recently

Consider negotiating for the right of discovery - alternatively make plans to collect and retain written records

Alternatively chose a foreign law, such as Hong Kong, but accept a Chinese court. Chinese courts will try to enforce foreign laws when the parties specify in the contract

最佳做法 – BEST PRACTICES 6. Develop a Good Contract – cont’d. Law, Forum and Venue: Specify a choice of venue, the Chinese party is unlikely to agree to come to North America, in part because of cost considerations, consider Singapore law and venue, or Hong Kong SAR There is now an agreement between Hong Kong SAR and Beijing on the reciprocal enforcement of judgments If possible chose a Chinese venue in which you have other investments

6. Develop a Good Contract – cont’d.

Law, Forum and Venue:

Specify a choice of venue, the Chinese party is unlikely to agree to come to North America, in part because of cost considerations, consider Singapore law and venue, or Hong Kong SAR

There is now an agreement between Hong Kong SAR and Beijing on the reciprocal enforcement of judgments

If possible chose a Chinese venue in which you have other investments

最佳做法 – BEST PRACTICES 7. Monitor your IP after Closing Inside and outside of China – some are now shipping labels and product separately for assembly in other countries. Register trademarks with General Administration of Customs. They can act ex officio in seizing suspected counterfeit goods. Visit trade shows, eBay, small commodities markets in key areas of China, wholesalers, key retailers, places where legitimate products are made and sold

7. Monitor your IP after Closing

Inside and outside of China – some are now shipping labels and product separately for assembly in other countries.

Register trademarks with General Administration of Customs. They can act ex officio in seizing suspected counterfeit goods.

Visit trade shows, eBay, small commodities markets in key areas of China, wholesalers, key retailers, places where legitimate products are made and sold

最佳做法 – BEST PRACTICES 7. Monitor your IP after Closing Don’t forget internal monitoring Implement plant security measures Ensure that new employees are trained on security and confidentiality in Chinese In supplier’s plants have a representative on site

7. Monitor your IP after Closing

Don’t forget internal monitoring

Implement plant security measures

Ensure that new employees are trained on security and confidentiality in Chinese

In supplier’s plants have a representative on site

最佳做法 – BEST PRACTICES 7. Monitor your IP after Closing Don’t forget internal monitoring - Use surveillance equipment or firewalls on web sites - Ensure that proper security protocols are in place for trade secrets - Conduct regular training on security measures

7. Monitor your IP after Closing

Don’t forget internal monitoring

- Use surveillance equipment or firewalls on web sites

- Ensure that proper security protocols are in place for trade secrets

- Conduct regular training on security measures

最佳做法 – BEST PRACTICES 8. Develop your 关系 (guanxi) or relationships Customs officials Provincial and city authorities Embassy Chinese and foreign based trade associations Local Administration for Industry and Commerce 工商行政管理局

8. Develop your 关系 (guanxi) or relationships

Customs officials

Provincial and city authorities

Embassy

Chinese and foreign based trade associations

Local Administration for Industry and Commerce 工商行政管理局

INTELLECTUAL PROPERTY PROTECTION IN CHINA: Best Practices 知识产权的保护在中国 : 最佳做法 Paul Jones Jones & Co. 钟保禄律师事务所 Джоунс и Ко. www.jonesco-law.ca Research to Revenue The Biotechnology Initiative December 3, 2008

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From Research to Revenue IV: Capturing Business Opportunities in Asia From Research to Revenue IV: Capturing Business Opportunities in Asia