NPS Pharmaceuticals Investor Slide Deck

38
Developing Orphan Products for Patients with Rare Gastrointestinal and Endocrine Disorders August 2012

Transcript of NPS Pharmaceuticals Investor Slide Deck

Page 1: NPS Pharmaceuticals Investor Slide Deck

Developing Orphan Products for Patients with Rare Gastrointestinal and Endocrine Disorders

August 2012

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Safe harbor statement

Statements made in this presentation, which are not historical in nature, such as the timing of the potential regulatory submission, approval process and commercialization of the company’s late-stage registration programs, the company’s expected future cash flows from the company’s royalty-based portfolio of products and product candidates, the company’s future operations and the company’s 2012 cash burn guidance, constitute forward-looking statements for purposes of the safe harbor provided by the Private Securities Litigation Reform Act of 1995. These statements are based on the company's current expectations and beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements, such as the risk that we do not receive regulatory approval to market our late-stage registration programs in a timely manner, or at all, the risk that we fail to maintain our existing collaborative relationships related to the company’s royalty-based portfolio of products and the risk that our cash flows are lower than expected due to increased expenses or lower cash in-flows from applicable collaborations, as well as other risk factors described in the company’s periodic filings with the U.S. Securities and Exchange Commission, including its Annual Report on Form 10-K and Form 10-Qs. All information in this presentation is as of the date of this presentation and NPS undertakes no duty to update this information.

August 2012

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NPS value proposition is defined by a near-commercial pipeline, significant royalty cash flows, and a strong operational position

Valuable royalty-basedportfolio expected to significantly enhance

cash flows

• Royalties on Sensipar®/Mimpara® represent significant value

• FY11 sales of $808M (up 13% YOY) and YTD 2012 through 6/30 $444M (up 16% YOY)

• Partially monetized as non-recourse debt ($92M at 6/30/12, 9% interest); first $32M per year of royalties withheld to repay debt with $50-60M + excess paid to NPS

• Debt expected to be repaid in mid-2015; NPS to receive 100% of royalties through 2018

• Royalties on Nucynta® and Revestive® are unencumbered

Near-commercial, orphan product

candidates with strong market potential

• Gattex® (teduglutide) in short bowel syndrome (SBS)• Expected NDA approval in 2012; EU marketing authorization expected 3Q12

• Natpara™ (PTH 1-84) in hypoparathyroidism• Expected BLA filing in 2012 and approval in 2013

• NPSP790 and NPSP795 (calcilytics): potential in ADHH, an ultra-orphan disorder

Strong operational position

• $135M1 in pro-forma cash and investments at 06/30/12; adequate cash to launch both products

• Only recourse debt is ~$17M convertible note due in 2014

• Management team with proven track record of developing and launching orphan products

• Strategic outsourcing business model maximizes operational efficiencies

1 25M payment received from Amgen in July 2012

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NPS’ product pipeline is highlighted by two advancing registration programs and a potential product launch in 2012

Product/productcandidate Indication Preclinical P1 P2 P3 Regulatory

review Marketed Notes/partner

GATTEX Short bowel syndrome Nycomed/Takeda (Ex-North Am.)

NATPARA Hypoparathyroidism Nycomed/Takeda (Ex-North Am.)

NPSP790 & NPSP795 ADHH* WW rights

Teduglutide Pediatric/other Nycomed/Takeda (Ex-North Am.)

Sensipar/Mimpara Secondary & primary hyperparathyroidism

Amgen (WW Ex-Asia)

REGPARA Secondary hyperparathyroidism

Kyowa Hakko Kirin (Asia)

Preotact Osteoporosis Nycomed/Takeda (Ex-North Am.)

NUCYNTA Moderate/severe pain Janssen (US)

Revestive Short bowel syndrome Nycomed/Takeda

Cinacalcet HCl Post renal transplant Amgen

Ronacaleret Bone disorders GSK (WW)

4*Autosomal dominant hypocalcemia with hypercalciuria

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NPS is well-equipped to transition into a commercial company and deliver significant value-drivers in 2012

Milestone StatusGATTEX in short bowel syndrome:

Acceptance of NDA submission

FDA Advisory Committee meeting 2H12

Positive CHMP opinion

Commercial and supply-chain readiness 2H12

FDA approval of GATTEX 2H12

Commercial launch of GATTEX 2H12

NATPARA in hypoparathyroidism:

Hold pre-BLA meeting with FDA

Report additional REPLACE data

Submit U.S. BLA 2H12

NPSP790 and NPSP795 (calcilytics):

Define development strategy 2012

Teduglutide in additional indications:

Define development strategy 2012

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GATTEX® (teduglutide) in Short Bowel Syndrome

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SBS is a highly disabling disorder that is often managed with parenteral nutrition (PN) and intravenous (IV) fluids

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Typically occurs after extensive intestinal resection due to disease or injury

Remaining gastrointestinal tract unable to absorb sufficient nutrients and/or fluids on a conventional diet

Patients may have to rely on parenteral nutrition or IV fluids to survive

Patients are socially and personally impaired

The largest obstacle is the need to be ‘hooked-up’ to PN for many hours per day

Disorder characteristics

Patients are on PN/IV fluid for ~6 nights per week; 8 to 12 hours a day

Can lead to serious life-threatening complications, including infections, blood clots, and liver damage

Socially and personally constraining: diarrhea, frequent urination, difficulty sleeping and loss of functional independence

Reduced 5-year survival*

30 to 80% probability of survival depending on age at PN initiation

Challenges of PN/IV fluid dependence

Goal of GATTEX therapy: improve the structural and functional integrity of the remaining intestine

* Survival of Home Parenteral Nutrition-Treated Patients: 20 Years of Experience at the Mayo Clinic. Scolapio et al. Mayo Clin Proc 1999;74: 217-222

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GATTEX® (teduglutide) is a GLP-2 analog that could be a first-in-class treatment for adult SBS

GLP-2 is a 33-amino acid endogenous peptide secreted from intestinal L-cells after meal ingestion

Physiological properties of GLP-2:

Expands intestinal mucosa

Enhances nutrient absorption

Stimulates intestinal blood flow

Increases intestinal barrier function

GATTEX (teduglutide):

DPP-IV degradation resistant recombinant human GLP-2 analog

Differs from GLP-2 only by an N-terminus substitution of glycine for alanine in position 2

Extends half life from 7 minutes to 2 hours

Once-daily subcutaneous injection

Patent exclusivity through April 2020 and orphan designation

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STEPS Phase 3 registration study and STEPS 2 open-label continuation study design

STEPS 2: 24-month open-label continuation study

STEPS: 24-week Phase 3 registration study

PN optimization

and stabilization

~4-16 weeks

GATTEX 0.05 mg/kg/day

(n=43)

GATTEX 0.05 mg/kg/day

GATTEX 0.05 mg/kg/day

Placebo(n=43)

Enroll Randomize (baseline)

24 weeks TLR1Q11

LPLV 1Q13

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Phase 3 STEPS data presented at DDW 2011 show GATTEX reduces parenteral nutrition dependence in adult SBS patients

63%

30%

0%

40%

80% Primary endpoint: 20% to 100% reduction of

PN/IV from baseline at weeks 20 & 24

63% of GATTEX patients achieved endpoint vs. 30% for placebo (p=0.002)

At week 24, GATTEX patients achieved a mean 4.4L (34%) reduction in weekly PN/IV volume from 13L baseline vs. 2.3L (18%) for placebo (p<0.001)

Despite the significant reduction in weekly PN/IV volume, GATTEX patients maintained their nutritional status

Body weight was stable for GATTEX-treated patients

Liver function: statistically significant improvement seen in ALT, AST, and bilirubin values in the GATTEX group vs. placebo

-5

-2

1

Lite

rs p

er W

eek

*

Resp

onde

r ra

te

n=43 n=43*p=0.002

**p<0.001

4.4L**

2.3L

n=39

n=39

GATTEX

Placebo

Baseline PN/IV volume:GATTEX: 12.9LPlacebo: 13.2L

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In the 24-week Phase 3 STEPS registration study GATTEX significantly reduced PN/IV volume requirements

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Week

PN/I

V lit

ers

per

wee

k

GATTEX

Placebo

*

**

***

***

***

******

p≤0.05

p≤0.01

p≤0.001

Baseline volume:GATTEX: 12.9LPlacebo: 13.2L

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Gattex achieved greater reductions in fluid composite effect versus placebo

-2.63

-3.46-4.25 -4.05

-4.65-5.38

-0.38-0.99 -1.29 -1.25 -0.93 -1.07

-6

-5

-4

-3

-2

-1

0

4 8 12 16 20 24

GATTEX

Placebo

12

Lite

rs/w

eek

Weeks

Change in urinary output, oral intake, and PN/IV volume

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And 54% of GATTEX-treated patients achieved one or more days off PN/IV at week 24 of Phase 3 STEPS study

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43

1

6

1 1 1

0

2

4

6

8

10

12

14

1 to <2 2 to <3 3 4

GATTEX: ≥ 1 day = 21/39 (54%) Placebo: ≥ 1 day = 9/39 (23%)

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P=0.0047

# o

f pa

tient

s

Reduced days per week

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12-month data further supports the potential of GATTEX with some patients achieving independence from PN/IV

STEPS 2 interim analysis for 34 patients who had received 12 months of treatment

91% of patients achieved a 20% to 100% reduction in PN volume

Mean reduction in PN/IV volume was 5.2 liters per week or 40% from pre-treatment baseline

24% of patients (8/34) reduced their infusion days per week by three or more

As of May 2012, seven patients have achieved independence from PN/IV while on Gattex in STEPS 2

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53%

38%

24%

0%

10%

20%

30%

40%

50%

60%

1 to <2 2 to <3 3

GATTEX: ≥ 3 days = 24% (13/34)Pe

rcen

tage

of

patie

nts

Reduced days per week

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NPS submitted its New Drug Application for GATTEX in 4Q11 and is preparing for a number of key potential events in 2012

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NDA submitted

NDA accepted

FDA Advisory

Panel

EMA approval

Commercial launch

4Q112012

1Q 2Q 3Q 4Q

Sep. 30 PDUFA

Positive CHMP Vote

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Gattex commercial launch strategy is based on 5 strategic objectives

Commercial leadership with extensive experience with orphan disorders

Commercial build-up gated by key milestones Positive Phase 3 results

NDA acceptance

Positive Advisory Committee

NDA Approval

Focus on patient identification

Secure market access and reimbursement

Offer personalized patient services

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Patient identification is key in the orphan drug space

Prevalence versus reachable patients

Treatment flow from resection to home healthcare with PN/IV fluids

Patient-sourcing tactics:

Patients / sites enrolled in clinical development program

Partnering with patient advocacy groups

NORD, the Oley Foundation, ASPEN, etc.

Leveraging internet and social media activities

Shortbowelsupport.com

Online forums

Deployment of MSLs

Networking with thought leaders and centers of excellence

Potential collaboration with home infusion companies

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Access and reimbursement critical to a successful launch and should not be underestimated

Market access studies 13 payers - 155 MM lives and 12 payers - 118 MM lives

SBS / Gattex reimbursement profile: Orphan status - unmet medical need – solid clinical evidence

Price inelastic with hurdles to reimbursement

SBS patients’ reimbursement coverage 85% of SBS patients have coverage

~60% commercial, ~20% Medicare, and ~20% Medicaid

Internal expertise Successful track record of securing access and reimbursement to orphan drugs

Operational elements Health economics-based value proposition ready at launch

Gattex launch with co-pay and co-insurance support

Go-to-market limited to specialty pharmacy network

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Patient HUB will offer personalized service to each Gattex patient

Personalized service will accompany each SBS patient throughout the Gattex experience

The patient services HUB Manned by NPS care coordinators

Coordinate clinical services

Avoid any additional burden to the prescribers

Expected deliverables Mitigate patients’ reimbursement challenges

Educate patients about Gattex characteristics and use

Support REMS (if need be)

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NPS Advantage™ (patient services HUB; back office support)

Reimbursement services

Patient assistance evaluation

Adverse event reporting

Product complaints & returns

After hours call center support

Data services and management

Patient-centric commercial strategy will focus on burden-free access and care through a single NPS contact - Care Coordinator

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HCP office &“start” form

NPS Care Coordinator(customer facing) Patient

On-call nurse

Dietitian/nutritionist

Home health care nursing

Pharmacist

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Summary of GATTEX in SBS

SBS is a rare and chronic disorder with an estimated U.S. prevalence of ~10-15 thousand

Patients are dependent on PN/IV fluid for nutrient and fluid support

This supportive care significantly impacts patients lives

Associated with serious and sometimes life-threatening complications

Comprehensive, patient-centric strategy underway

Limited competition

Positive reimbursement and pricing outlook

Market is accessible with a relatively small commercial infrastructure

GATTEX is a first-in-class treatment that address the underlying goal of SBS therapy –improving intestinal absorptive capacity and reducing dependence on PN/IV fluids

Significantly reduces PN/IV fluid volume dependence

Significantly reduces the number of infusion days per week

Achieves complete weaning off of PN/IV infusions for some patients

IP exclusivity through April 2020

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NATPARA™ in Hypoparathyroidism

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When the parathyroid (PTH) gland cannot produce PTH normally, homeostasis of calcium and phosphate cannot be achieved

There are multiple dimensions of and consequences to hypoparathyroidism

Hypocalcemia

Hyperphosphatemia

Renal wasting of calcium which can cause hypercalciuria

Bone, muscular, nerve, and kidney complications

No approved PTH replacement therapy

Current approaches aim to reduce severity of symptoms by raising serum calcium levels with calcium and active vitamin D supplementation

Active vitamin D and calcium supplementation can worsen complications

Hypercalciuria

Hyperphosphatemia

Irreversible complications of the kidney, eye, heart, and brain

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Hypoparathyroidism complications range from mild or moderate symptoms to irreversible complications

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Symptoms and complications: Paresthesias (tingling, numbness) Carpopedal spasm (violent, painful

contraction of the muscles in the hand/feet) Tetany (involuntary muscle

contraction/cramping) Seizure Bradycardia Hypercalciuria (excessive urinary calcium

excretion) Hyper-mineralized bone Vitamin D intoxication

Irreversible complications can include: Kidney stones End-stage renal disease Cardiovascular diseases Calcium deposits in the brain Cataracts

http://www.mayoclinic.com/http://www.uptodate.com/Velasco et al, ” Psychiatric Aspects of Parathyroid Disease “ Psychosomatics 40:6, November-December 1999

n=268

39%

21%

12% 11%

0%

10%

20%

30%

40%

CognitiveImpairment

NonspecificPsychiatricSymptoms

NeuroticSymptoms

Pychosis

% o

f Pa

tient

s

Hypoparathyroidism cognitive and psychiatric complications

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New research presented at ENDO 2012 underscores high burden of disease for hypoparathyroidism

Investigators from Mass General and Brigham and Women’s Hospital presented “Long-term follow-up of patients with hypoparathyroidism – a cohort study” by Mitchell et al.

Detailed chart reviews of 120 patients (with observation period of 7 years (IQR 4-14)) 73% were female, mean 52 years (range 2-87), 66% post-surgical

Renal effects: 38% (20/53) had a 24-hour urine calcium level ≥ 300mg*

31% (17/54) had renal calcifications or stones

41% had eGFR <60 mL/min/1.73m2

2% required renal transplantation

52% (16/31) had basal ganglia calcifications

8% (10/120) had at least one hypocalcemic seizure

33% were evaluated in an emergency department or hospitalized for hypoparathyroidism complications, including 7% in the last year of observation

Conclusion: data show that hypoparathyroidism and its treatment carry an unexpectedly high burden of disease

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*Normal urine Ca excretion 50-300 mg/24 hr

Note: Per National Kidney Foundation, the GFRs associated with the stages of chronic kidney disease are as follows: stage 1 GFR<90, stage 2 GFR 60-89, stage 3 GFR 30-59, stage 4 GFR 15-29, stage 5 GFR<15.

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There is a disconnect between patients and physicians about hypoparathyroidism…

“It takes a long time to get a diagnosis and is hard to control”

“Hypoparathyroidism is fairly simple to diagnose and easy to control”

“I go from physician to physician in search of a knowledgeable about treating my disorder”

“The disease is fairly simple and straight forward” (under value the disease)

“Taking multiple pills per day and being a calcium roller coaster is a major burden”

“It’s not a big deal to have to take calcium and vitamin D”

“I get brain fog and cognitive effects”

“The cognitive issues are not a part of the disease” (discount cognitive effects)

PhysicianPatient

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New patient research recently launched to better describe hypoparathyroidism burden of illness and patient challenges

Recently launched PARADOX – Patient Attitudes and Responses About Disorder Outcomes eXplored

In partnership with The Hypoparathyroidism Association and the Mayo Clinic

Designed with input from physician thought leaders and patients

Communicate the burden of illness to the broader community (physician, payer, patient, regulatory) in advance of launch

Giving patients a voice to help validate the physical, emotional, and quality-of-life challenges they experience every day

Market research suggests patients are very frustrated; no one understands their plight

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I can’t be alone anymore. I can’t drive. The looming fear of tetany and even a seizure hangs over me constantly. Physically, I can’t use my legs for very long without them feeling numb, so simple trips to the store or even doing things with my family, like playing with the children, going on walks, hiking—all things we used to do—become challenging.

-- Amy, age 42

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NATPARA could be a major advance in treating hypoparathyroidism

The first and only bioengineered replica of the full-length endogenous 84-amino acid parathyroid hormone

The mechanism of action offers a more physiological outcome with the potential to reduce long-term complications

Potential to reduce large fluctuations in their serum calcium levels

NATPARA will be available in multiple dosages to allow for personalized treatment

U.S. exclusivity: Patent exclusivity through December

2018

Orphan status with BLA market exclusivity expected through 2025

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NATPARA™ Phase 3 registration study (REPLACE)O

ptim

ize

~0-

10 w

eeks

Randomize (Baseline)

N=134

50mcg75mcg

100mcg

Insufficient response – titrate up

Week 24 (endpoint)

Adjust vitamin D and calcium

Dosetitration

Randomized, double-blind, dose escalating, placebo-controlled

Primary endpoint: maintain serum calcium while reducing calcium and vitamin D analog supplementation by 50%

Once-daily SC injection administered with a pen

NATPARA

Placebo Placebo 1Placebo 2

Placebo 3

4-week follow-up

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24-week Phase 3 REPLACE study delivered statistically significant results; data presented at ENDO 2012

Primary endpoint: maintain serum calcium while reducing calcium and vitamin D analog supplementation by 50%

Secondary endpoint: percentage of patients who achieved independence from active vitamin D and decreased oral calcium to 500 mg or less

NATPARA was well tolerated and compliance was high

93% (84/90) of NATPARA-treated patients completed the study versus 82% (36/44) of placebo-treated patients

Similar incidence of adverse events and serious adverse events for both groups

53%

2%0%

20%

40%

60%

Natpara Placebo

30

43%

5%

0%

20%

40%

60%

Natpara Placebo

p<0.0001

p<0.0001

Resp

onde

r ra

teRe

spon

der

rate

Primary endpoint: ITT analysis

N=90 N=44

N=84 N=37

% of patients who achieved independence from supplementation at week 24

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NATPARA is on track for a 2013 launch as the first approved hypoparathyroidism replacement therapy

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4Q11 2012 2013

Nov. 7, 2011: Positive Phase 3

Results

Presentation of additional data

Submit US BLAPre-BLA

meeting with FDA

FDA Advisory Panel

Potential FDA Approval

Commercial launch

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Market-sizing research estimates a U.S. prevalence of ~65,000 insured patients

Study used the IMS Life-Link Health Plan claims database, with 60 million unique U.S. patients and two epidemiologic approaches to improve validity

Captured the number of cases over a 12-month period (October 2007-September 2008)

Two methodologies based on claims data

Prevalence-based approach calculated using hypoparathyroidism diagnosis and hypocalcemia diagnosis with known hypoparathyroidism indicators (neck surgery, etc.)

Incidence-based approach calculated by counting the number of parathyroidectomy, thyroidectomy and neck dissection surgeries

Both methods in the study arrived at a similar estimate of ~60,000 to 65,000 insured patients with chronic adult hypoparathyroidism

Research recently presented at American Association of Clinical Endocrinologists (AACE) and International Society for Pharmacoeconomics and Outcomes Research (ISPOR) meetings

Epidemiological research provides directional support of market size however, market development and patient finding activities complement estimates from the “bottom up”

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Treating the underlying cause ranked as the most important in terms of unmet needs and the greatest advantage of NPSP558’s profile

Over 50% of physicians interviewed indicated they will be early-adopters

Mild, moderate, and severe cases were largely categorized based on symptoms

Largest expected use in moderate to severe

Market research underscores the favorable market dynamics for hypoparathyroidism

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Source: 2010 third-party market research funded by NPS

Chronic cases

Survey of 290 physiciansSevere

Moderate

Mild

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Summary of NATPARA in hypoparathyroidism

Hypoparathyroidism is a rare and chronic disorder with an estimated U.S. prevalence of 80,000+ (60-65,000 insured)

There is no approved long-term PTH replacement therapy

Current treatments aim to manage symptoms through calcium and active vitamin D supplementation Can exacerbate the condition and cause irreversible complications of the kidneys, heart, brain,

and eyes

Patients are often highly symptomatic (tingling, parathesias, tetany, seizure, etc.) and complications range from mild to moderate to irreversible complications, such as renal disease

NATPARA could be the first approved long-term replacement therapy for hypoparathyroidism Offers a more physiological treatment outcome

Significantly reduces calcium and active vitamin D supplementation

Achieved complete weaning from supplementation for nearly half of patients

Well tolerated with 93% of NATPARA-treated patients completing the REPLACE study

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Financials & Summary

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Pro forma cash and investments1 $135

Current liabilities2 $35

5.75% convertible debt due 2014 ($5.44 conversion) $17

Non-recourse debt3 $166

Shares outstanding 86

2012 cash burn guidance1 $60-70

Key financial information

1 Includes impact of June 2012 Amgen / Sensipar transaction2 Excludes amounts associated current portion of non-recourse, Sensipar- and Preotact-secured non-recourse debt of $8M3 Long-term, Sensipar-secured non-recourse debt is $92.3M

06/30/12(in millions)

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In summary, the NPS investment offers multiple value drivers

Two near-commercial orphan product candidates with positive Phase 3 results and strong top- and bottom-line potential

GATTEX® expected to be approved in late 2012 for the treatment of adult SBS

U.S. BLA submission for NATPARA™ in hypoparathyroidism on track for 2012

Valuable royalty-based portfolio

Sensipar/Mimpara royalties expected to significantly enhance cash flows in 2012 through 2018

Partially monetized as non-recourse debt ($92M at 6/30/12, 9% interest); first $32M per year of royalties withheld to repay debt with excess paid to NPS

Debt expected to be fully repaid in mid-2015; NPS to receive 100% of royalties through 2018

Strong operational position

$135M in pro-forma cash and investments at 06/30/12; adequate cash to launch both products

Solid management team with a proven track record for delivering on stated objectives

Strategic outsourcing business model maximizes operational efficiencies

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Developing Orphan Products for Patients with Rare Gastrointestinal and Endocrine Disorders

August 2012