Building an Ecosystem to Enable, Encourage and Support

New Products for AA

William Ju MD, FAAD

Advancing Innovation in Dermatology, Inc.

ALOPECIA AREATA RESEARCH SUMMIT

November 14, 2016

Disclosures

Advancing Innovation in Dermatology, Inc. ^ #

Aclaris Therapeutics, Inc. *

Amicus Pharmaceuticals, Inc. *

Brickell Biotech, Inc. ^ * +

^ Board of Directors/Trustees

# Officer (President)

* Consultant+ Equity Ownership

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Advancing Innovation in Dermatology (AID)

Topic: “Building an Ecosystem to Enable, Encourage and Support

New Products for AA”

AID Mission: Advancing Innovation in Dermatology is a non-profit organization with a mission to help grow an ecosystem for creating and bringing to market an increased number of innovative and scientifically-based products that substantially improve dermatologic health

Why Build Collaboration Ecosystem for Dermatology ?

Product Innovation Can Be Complex and Costly

“Cost of bringing drug to market tops $2.5b, research finds”By Robert Weisman, Boston Globe, November 18, 2014

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• If this is true (even within an order of magnitude), a daunting amount

• Proactively building ecosystem can help facilitate finding resources and backing to support innovative and impactful product development

Ecosystem For Innovative Product Flow:

Technical and Financial Streams

Research Center /

Entrepreneur

Discovery Regulatory

Approval

Invention Commer-

cialization

Late DevelopmentClinical POC Early Development

Venture

Capital Firm

Strategic Partner

Angel Investor /

Patient Advocacy /

Impact Philanthropist

5

Technical Stream

Financial Stream

Earlier-Stage Development

Dermatology Innovation Forum

6

Research Center /

Entrepreneur

Discovery Regulatory

ApprovalInvention Commer-

cialization

Late DevelopmentClinical POC Early Development

Venture

Capital Firm

Strategic Partner

Angel Investor /

Patient Advocacy /

Impact Philanthropist

Dermatology Innovation ForumMarch – AAD Annual Meeting

Technical Stream

Financial Stream

Later-Stage Development

Dermatology Summit

Research Center /

Entrepreneur

Discovery Regulatory

Approval

Invention Commer-

cialization

Late DevelopmentClinical POC Early Development

Venture

Capital Firm

Strategic

Partner

Angel Investor /

Patient Advocacy /

Impact Philanthropist

Dermatology SummitJanuary – JP Morgan Healthcare Conference

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Technical Stream

Financial Stream

Product Innovation Ecosystem

Dermatology is an Attractive Investment Area

• Dermatology product innovation can attract investment; in 2016

– M&A: Pfizer acquired Anacor - $5.2 Billion purchase price

– IPO: Novan – $ 330 Million market capitalization

– Venture capital investment: Sienna Pharmaceuticals $ 46 Million Series A round

• Products investable in for dermatology span a range of conditions

– Actavis acquired Allergan

• $ 70 Billion purchase price

• Dermatology aesthetic products major revenue source

– Amicus Therapeutics acquired Scioderm

• $230 Million upfront payment (plus $ 620 Million for additional milestones)

• Orphan disease - epidermolysis bullosa8

Alopecia Areata Research Summit – Product Innovation Ecosystem

Identifying and Defining the Problems Worth Solving

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Research Center /

Entrepreneur

Discovery Regulatory

Approval

Invention Commer-

cialization

Late DevelopmentClinical POC Early Development

Venture

Capital Firm

Strategic Partner

Angel Investor /

Patient Advocacy /

Impact Philanthropist

Dermatology Innovation ForumMarch – AAD Annual Meeting

Technical Stream

Financial Stream

• Technical stream: unmet medical need

• Financial stream: pain point

• NAAF Alopecia Areata Research Summit participants have profound insights of the problems worth solving for AA

Alopecia Areata Research Summit – Product Innovation Ecosystem

Applying Know-How & Technology to Solve the Problem

• A deep understanding of biology of the disease pathophysiology can provide novel targets and approaches that lead to treatment breakthroughs

• Multiple examples of this paradigm, upon which much of the biomedical therapeutics industry is based

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Basic

Research

Biology

Target IDTarget

Validation

Chemistry DevelopmentApproved

DrugScreening Optimization

Pre-

clinical

Phase

I

Phase

II

Phase

III

FDA

review

Eureka !

O

OCH3

OCH3

OCH3

OH

Alopecia Areata Research Summit – Product Innovation Ecosystem

Determining Clinical Research Approach for Product Innovation

• Key role for clinical outcome assessments in the path to regulatory approval– Identifying what aspects of the disease need to be altered as priority by a new therapy– Determining how to measure whether an intervention improves a disease dimension

• Validated outcome measures for treatments are important for– Technical stream: e.g. for health authority product approval– Financial stream: e.g. for determining a product’s value to patients and payers

• Particularly important without previous regulatory approvals and market launches11

Basic

Research

Biology

Target

ID

Target

Validatio

n

Chemistry DevelopmentApprove

d DrugScreening OptimizationPre-

clinical

Phase

I

Phase

II

Phase

III

FDA

review

Eureka !

O

OCH3

OCH3

OCH3

OH

Other Elements for Product Innovation

Inventions, Products, and Assets

Research Center /

Entrepreneur

Discovery Regulatory

Approval

Invention Commer-

cialization

Late DevelopmentClinical POC Early Development

Venture

Capital Firm

Strategic Partner

Angel Investor /

Patient Advocacy /

Impact Philanthropist

12

Technical Stream

Financial Stream

O

OCH3

OCH3

OCH3

OH

Product

Asset

Advancing Product Development A Team Sport

Support and Enablement from the Ecosystem

Research Center /

Entrepreneur

Discovery Regulatory

Approval

Invention Commer-

cialization

Late DevelopmentClinical POC Early Development

Venture

Capital Firm

Strategic Partner

Angel Investor /

Patient Advocacy /

Impact Philanthropist

13

Technical Stream

Financial Stream

O

OCH3

OCH3

OCH3

OH

Product

Asset

Cosmetics Devices

Diagnostics

Drugs/Biotechnology

eHealthGovt / Nonprofit

Investor

OTC

Physician/Academician

Service Provider

Company/Organization Representation

~300 Registrants

Annual Dermatology Innovation ForumAttendee Composition (March 2016 )

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Participants include:

• Technical Stream

– Physicians

– Researchers

– Inventors

– Government regulators

• Financial Steam

– Investors

– Strategic corporate partners

• Bridging stakeholders

– Patient advocates

– Service providers

Sponsors of the 2017 Dermatology Summit & Dermatology Innovation Forum

LEADERSHIP MAJOR

FOUNDING

SUPPORTING

Conference Benefactor

PREMIER

Conference Benefactor Conference Benefactor

Conference Benefactor

Conference Benefactor

Support and Enablement from the Ecosystem

Alopecia Areata Example

Research Center /

Entrepreneur

Discovery Regulatory

Approval

Invention Commer-

cialization

Late DevelopmentClinical POC Early Development

Venture

Capital Firm

Strategic Partner

Angel Investor /

Patient Advocacy /

Impact Philanthropist

16

Technical Stream

Financial Stream

O

OCH3

OCH3

OCH3

OH

Product

Asset

Building an Ecosystem toEnable, Encourage and Support New Products for AA

• Purposeful, proactively-built ecosystems can help enable productive collaboration for advancing product innovation for substantially improving dermatologic health

• Alopecia Areata Research Summit participants and NAAF are to be commended for your

– Patient focus, breakthrough bench & clinical research, and other contributions

– Collaborative interactions and ecosystem building for bringing forth important and impactful products for alopecia areata patients

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