• Lysosomal storage diseases, including Gaucher Disease, are orphan drug designated diseases
• Lysosomal storage diseases are a group of approximately 50 rare inherited metabolic disorders that are characterized by an abnormal build-up of various toxic materials in the body's cells as a result of enzyme deficiencies
• Gaucher Disease and other lysosomal storage diseases originate from genetic mutations that result in “misfolded” or mutated enzymes
• Even though these enzymes are misfolded many, including Glucocerebrosidase (the enzyme deficiency responsible for Gaucher Disease), are functional
• Misfolded enzymes are naturally destroyed via Endoplasmic Reticulum Associated Degradation (ERAD), which results in the disease state caused by critical enzyme deficiencies

There are ~8,000 total U.S. cases with a predominance in Ashkenazi Jews. Gaucher Disease is classified into 3 types according to neurological deterioration, age and progression rate:

Type 1: Most common; does not impact the Central Nervous System, and usually presents in adulthood with an enlarged liver, enlarged spleen, anemia, and bone disease

• 7,000 U.S. patients
• 5 therapies on the market with $1.6 billion in sales per year

Type 2: Exceedingly rare; involves the CNS, affects infants and is uniformly fatal by 2 years of age

• ~250 U.S. patients
• There are no therapies for Type 2 Gaucher Disease

Type 3: Begins at any time in childhood, involves the CNS, and is characterized by slowly progressive neurological deterioration and premature death

• 750-1,000 U.S. patients
• There are no therapies for Type 3 Gaucher Disease

FDA approved treatments for Type 1 Gaucher Disease revolve around two approaches.

Neither of these approaches addresses the fatal neurological deterioration that accompanies Type 2 and Type 3 disease. These patients have no therapeutic options

Enzyme Replacement Therapy (ERT) (intravenous): Biologics aimed to replace the critical enzyme deficiency; administered through IV infusion every 2 to 4 weeks

• 3 drugs: Marketed Sanofi (Genzyme), Pfizer, and Shire
• ~$1.5 billion in total annual sales

Substrate Reduction Therapy (SRT) (oral): Small molecule drugs aimed to decrease the accumulation of harmful storage material; administered through daily pills

• 2 drugs: Marketed by Sanofi (Genzyme) and Acetelion Pharma
• Significant side effects preventing adoption
• ~$150 million in total annual sales
• All 5 approved Type 1 drugs continue to show year over year growth
• The indication supports multiple drugs

• The total Type 1 Gaucher Disease market exceeds $1.6 billion dollars
• All 5 approved Type 1 drugs continue to show year over year growth
• The indication supports multiple drugs
• Premium pricing is preserved with average annual drug cost per patient exceeding $360,000
• Pricing remains strong even as new drugs are introduced
• Early mover advantage

LifeSci Capital Equity Research Analysis of Orphan Drug Market February 4, 2016

Initial $325 million Type 3 Gaucher Disease market opportunity without competition

Demonstrated ability to address an UNMET CLINICAL NEED In Type 3 Gaucher Disease patients

Type 3 Gaucher Disease Market Opportunity

• $325 million U.S. market opportunity
• No existing therapies on market or under development
• We address the fatal neurological deterioration of Type 3 disease
• All Type 3 patients should be treated
• ~800 addressable U.S. patient population (100%)
• Although small market, successful companies such as Alexion have focused on diseases with less than 500 patients

• Market opportunity may expand to $2.3 billion for Type 1 Gaucher Disease patients
• Expanding market opportunity to treat Type 1 patients based on oral dosage in an existing large and profitable market

Type 1 Gaucher Disease Market Opportunity

• Current $1.5 billion U.S. market for intravenous administered ERT therapy;
• Only 50-60% of Type 1 patients are treated
• ERAD plans to introduce an oral formulation of our drug
  • We believe newly diagnosed Type 1 patients will be preferentially started on our therapy and existing Type 1 patients may switch
• $2.35 billion U.S. market opportunity in Type 1
• 8,000 total addressable U.S. patient population (100%)
• Potentially applicable in treating the Parkinson-like symptoms associated with both Gaucher Disease patients and disease carriers