Denufosol is a P2Y2 agonist in phase III for cystic fibrosis (CF). Denufosol has an appealing mechanism of action: it activates an alternative chloride channel which bypasses the basic CF defect. The first phase III trial (TIGER-1) was technically positive, as it met the primary endpoint. However, secondary endpoints raised important concerns. Encouragingly, an uncontrolled open label extension indicated that denufosol may work slowly and steadily. The second ongoing phase III trial (TIGER-2) treats a larger number of patients for a longer period, aiming at confirming that the treatment benefit increases over time. But TIGER-2 needs to do better than TIGER-1 on secondary endpoints as well to avoid clinical, regulatory and commercial challenges. This report discuss all these risks in detail and provides revenue projections for denufosol, should it be approved.

Published: August 26th, 2010

Number of pages: 37

Authors: Dr. Ilana Fogelman and Dr. Ellen Brady

TABLE OF CONTENTS
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INTRODUCTION
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1. Cystic Fibrosis – The Disease

DENUFOSOL'S
EARLY CLINICAL DEVELOPMENT
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1. Lung Function Testing (Spirometry)
2. Study 08-101: Single-Dose Safety In Healthy And Smoking Male Volunteers
3. Systemic Exposure Is Minimal Following IV And Oral Nebulized Dosing
4. Study 08-102 – A Phase I/II Trial
5. Phase II Studies
- Study 08 103 results
- Study 08 104 results

PHASE III: TIGER-1
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1. Primary Endpoint
2. Secondary Endpoints
- Pulmonary exacerbations
- Resource utilization
- Quality of life
3. Safety

CONFIRMATORY TRIAL (TIGER-2) IS UNDERWAY
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OPINION
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1. Denufosol’s mechanism of action circumvents the basic defect in CF
2. Phase II studies defined the population likely to benefit from and tolerate denufosol
3. TIGER-1 met the primary endpoint. Were the results robust enough?
4. What do secondary endpoints tell us?
5. Is the lack of impact on pulmonary exacerbations a concern?
6. What TIGER-2 needs to achieve to avoid regulatory risk
7. What is the clinical relevance of denufosol lung function results?
8. What about safety?

COMPETITION
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1. Key approved and experimental airway liquid restoration agents
- Hypertonic saline (Hyper-Sal, PARI Respiratory Equipment)
- Mannitol (Bronchitol™, Pharmaxis)
- Mannitol Phase III results: CF-301 and CF-302
- Moli1901 (lancovutide/duramycin - Lantibio and AOP Orphan Pharmaceuticals)

2. Other programs in early stages of development with unclear status
- Aerolytic (Aerovance)
- Parion 552 (Parion Sciences)
- GS-9411 (P-680; Gilead)

3. Can denufosol compete against hypertonic saline and mannitol?

4. What about CFTR repair therapies in development for CF, such as Vertex’s and PTC Therapeutics’ drugs?

MARKET OPPORTUNITY
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1. The overall market opportunity for airway hydration agents

2. Estimating denufosol’s market opportunity

3. Revenue projections

CONCLUSION
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