gRED: Highlights with focus on Inflammation

Richard H. Scheller Head of gRED Roche Group Unique diversity of approaches

Independent centers for research Academia & Worldwide execution industry and early development

Global Product gRED Development

Over 150 pRED Manufacturing partners

Chugai Commercialisation

Roche Diagnostics

2 Genentech Research and Early Development Genentech Research & Early Development aspires to make fundamental scientific discoveries and to develop these discoveries into first and best in class therapeutics that provide unique benefit to patients Genentech founded: 1976 Integrated with Roche: 2009 Genentech Research and Early Development (gRED) is established as independent unit within the Roche Group gRED Business Divisions: Research, Early Development, Portfolio Management and Operations, gPartnering Therapeutic Areas: Oncology, Immunology, Metabolism, Neuroscience, Infectious Disease Pipeline: 39 NMEs in Early development to Phase 2

Science gRED Employees: ~ 2,000 Genentech named on Fortune‘s “100 Best Companies to Work For“ – thirteen consecutive year on the list Cell 3 The Research Leadership Team

Michael Varney Andy Chan Senior Vice President Senior Vice President Small Molecule Drug Discovery Biology

Rick Brown Vice President Immunology & Infectious Diseases

Bruce Roth Vice President Discovery Chemistry Melissa Starovasnik Vice President Res Ops & Structural Biology

Fred de Sauvage Vice President – Molecular Biology Vishva Dixit Vice President Early Discovery Research

Ira Mellman Morgan Sheng Vice President – Oncology Vice President – Neuroscience 4 Proven track record of scientific excellence

Genentech publications

600 Total Cell, Science, Nature 500 479 406 400 376 306 289 288 303 291 292 280 284 272 285 300 243 253 248 248 235 222 204 205 205 183 193 200 165 180 166 133 90 100 100 63 41 16 3 7 8 161622192916221212101611128 7 7 6 104 3 4 9 4 9 107 1117125 0 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012

12 papers were published in Cell, Science and US patents issued to Genentech in the last 10 Nature in 2011 years

300 275 221 200 137 123 85 100 70 76 74 67 70 79

0 2001 2003 2005 2007 2009 2011 5 gRED portfolio governance

Research Review Committee (RRC) Early Stage Portfolio Committee (ESPC) • Sponsor: Richard Scheller, Ph.D. • Sponsor: Richard Scheller, Ph.D. • Alternate Chairs: • Alternate Chairs: • Andy Chan, M.D., Ph.D. • Sean Bohen, M.D., Ph.D. • Ira Mellman, Ph.D. • Mike Varney, Ph.D.

ED Phase 1 Phase 2 LIP Decision ESR LSR ED Go Go Ready Go Go Go ready Points

Discovery Early Stage Late Stage Early Phase Phase 1 Phase 2 Phase 3 Research Research Research Development

Governance ESPC LSPC / CEC RRC Scientific Late Stage DRC review DRC

Stratify/ Diagnostics Formulate diagnostic hypothesis Test diagnostic hypothesis validate 6 Our approach to discovery research Understanding disease biology is crucial in developing an effective treatment

Homogeneous diseases Defined underlying molecular defects manifesting in a unique set of symptoms Example: Erivedge in Basal Cell Carcinoma (BCC)

Heterogeneous diseases The majority of diseases caused by multiple defects that manifest as similar clinical syndromes. Currently, we classify and attempt to treat them as a single, homogeneous disease Example: Lebrikizumab in Asthma

We strive to characterize the dominant causal factors in subsets of a heterogeneous disease and tailor the treatment to this well-defined subset

7 Our approach to drug development Develop best-in-disease treatments

Develop clinically Target Product Profile is defined before the drug differentiated candidate enters clinical development based on products unmet medical need

Set high efficacy Clinical trials are designed with ambitious end points hurdles to identify promising leads early

Utilize biomarker Proof of concept studies are designed to show hypothesis remarkable efficacy in a target subpopulation

Technical review is performed on on-going bases to Adjust strategy as identify potential issues and reassess the probability appropriate of success

8 gRED Development Portfolio 39 NMEs from Early development to Phase 2 Early Development Phase 1 Phase 2 NME AKT inh (GDC-0068) Anti-EGFL7 NME Anti-angiogenic Anti-HER3/EGFR NME Anti-PD-L1 PI3K inh (GDC-0941) NME Anti-CD22 ADC PI3K/mTOR inh(GDC-0980) NME Anti-STEAP1 ADC Pateclizumab (Anti-LTα) NME Antibody Drug Conjugate Quilizumab(Anti-M1 prime) NME Antibody Drug Conjugate Etrolizumab (rhuMab β7) Antibody Drug Conjugate Rontalizumab (a-IFNα) Antibody Drug Conjugate Crenezumab (Anti-Aβ) Antibody Drug Conjugate Anti-Factor D Antibody Drug Conjugate Anti-oxLDL Bcl-2 inh (GDC-0199) Anti-PCSK9 ChK-1 inh (GDC-0425) ChK-1 inh (GDC-0575) Oncology MEK inh (GDC-0973) Immunology MEK inh (GDC-0623) Neuroscience PI3K inh (GDC-0032) Ophthalmology PI3K inh (GDC-0084) Metabolism Anti-IL17 Infectious Diseases NME 9 Status as of June 30th, 2012 Collaborations with Roche diagnostics Over half of the NMEs are developed with CDx Early Development Phase 1 Phase 2 NME AKT inh (GDC-0068) Anti-EGFL7 NME Anti-angiogenic Anti-HER3/EGFR NME Anti-PD-L1 PI3K inh (GDC-0941) NME Anti-CD22 ADC PI3K/mTOR inh(GDC-0980) NME Anti-STEAP1 ADC Pateclizumab (Anti-LTα) NME Antibody Drug Conjugate Anti-M1 prime NME Antibody Drug Conjugate Etrolizumab (rhuMab β7) Antibody Drug Conjugate Rontalizumab (a-IFNα) Antibody Drug Conjugate Crenezumab (Anti-Aβ) Antibody Drug Conjugate Anti-Factor D Antibody Drug Conjugate Anti-oxLDL Bcl-2 inh (GDC-0199) Anti-PCSK9 ChK-1 inh (GDC-0425) ChK-1 inh (GDC-0575) MEK inh (GDC-0973) MEK inh (GDC-0623) With Companion Dx* PI3K inh (GDC-0032) Roche Tissue Diagnostics/Ventana Roche Molecular Diagnostics PI3K inh (GDC-0084) Anti-IL17 Roche Professional Diagnostics NME 10 Legend conveys investment with CDx assay development partner and does not reflect all Dx activities. Includes both initiated and (near-term) planned collaborations. Major trends in gRED portfolio Progress in understanding disease biology and new antibody technologies have re-shaped our portfolio

We are pursuing targets outside oncology • 10 NMEs in other disease areas – Immunology, Neuroscience, Metabolism and Infectious Diseases We have built up a strong small molecules division • 10 small molecules are currently in clinical development We are exploring rational combinations to improve outcomes in oncology • Over 10 combinations of investigational products currently in clinic Extensive portfolio of antibody drug conjugates (ADCs) • 8 ADCs in clinical development for up to 10 oncology indications Novel antibody technologies • Bispecific and dual action antibodies may provide additional benefit in various diseases

11 gRED: Highlights with focus on Immunology

Andrew Chan, Senior Vice President gRED Research Biology Oncology Immunology Antibody Drug Conjugates (ADCs) Extensive pipeline of ADCs for oncology indications

Early Stage Late Stage Early Key Phase I/II Phase III Research Research Development Breast

AML ESR ESR LSR Early Dev Anti-CD22 T-DM1 Melanoma ESR ESR LSR RG7596 Colon ESR ESR LSR Anti-STEAP1 Lung ESR RG7458 Multiple ESR RG7598 Myeloma Ovarian ESR RG7599 Prostate ESR RG7600 Pancreatic ESR RG7636 NHL ESR

Diagnostics

3 As of July 25th, 2012 Solid tumor ADC 1 Confirmed partial response in ovarian cancer Baseline After 4 cycles

Zoom

• 60 year old woman with Ovarian Cancer following 7 prior therapies • Post cycle 2: partial response (-37.5%), Post cycle 4: confirmed PR (-51%) • Continues on study as of cycle 9 4 In collaboration with Seattle Genetics Solid tumor ADC 2 Confirmed partial response in ovarian cancer

Baseline After 4 cycles

1500 1374 1250

1000

750 CA125* 500 28

250

0 -15 0 15 30 45 60 75 90 105 Study Day

Cycle # 12 34

*Normal CA125: <36 Delay in Cycle 3 due to unplanned study hold

• 66 year old woman with Ovarian Cancer following 3 different chemo regimens • Confirmed radiographic partial response • Serum CA125 tumor marker 1374 28 5 In collaboration with Seattle Genetics Solid Tumor ADC 3 Confirmed partial response in lung cancer

Baseline After 4 cycles

RECIST 34% 

• 73 year old woman with poorly differentiated non-small cell lung cancer • Previously treated with chemotherapy and erlotinib • Currently on study as of Cycle 6 6 In collaboration with Seattle Genetics Antibody Drug Conjugates (ADCs) Summary

• Positioned well to advance largest industry platform of ADCs for all cancers

• 9 ADCs in the clinic and 1 ADC in Early Development – Early signs of clinical activity in many Phase 1 programs in both hematologic and solid cancers – Two Phase 2’s to be initiated in 2012 and three potential Phase 2’s in 2013

• All solid tumor ADCs have accompanying diagnostics to identify appropriate patient population

7 Oncology Immunology gRED Immunology Understanding disease biology to benefit patients

• Vision – Develop “best-in-disease” therapies to permit patients to live normal lives

• Strategy – Discover major biological pathways that drive disease in patient subsets

– Identify patient subsets that preferentially respond to targeted therapeutics

– Develop ‘best-in-disease’ targeted therapies with head-to-head clinical trials against standard of care therapies for patient subsets

9 gRED Immunology Disease Area Targets

Asthma Inflammatory Bowel Disease 1.5 million patients poorly controlled Prevalence up to 0.5% 1.5% of all ER visits and hospitalizations Almost $2B/yr in medical costs ~4000 deaths/yr Very poor sustained response to SOC

Rheumatoid Arthritis Idiopathic Pulmonary Fibrosis Up to 1% of population affected Progressive fatal disease 60% inadequate response (

Systemic Lupus Erythematosis Ocular Inflammation Multisystem disease with severe sequelae Multiple retinal diseases (DM, RVO, GA, AMD) SOC remains inadequate >10M affected Severe patients still require high dose SOC inadequate in most steroids or cytotoxic therapies

10 Asthma: Lebrikizumab (anti-IL13 MAb) Identification of patient subgroup with best response

asthmatics asthmatics & controls

May be responsive May NOT be responsive to lebrikizumab to lebrikizumab

Relative Mean FEV1 change at week 12

Total ITT population Periostin High Periostin Low Placebo 4.3% 5.8% 3.5% Lebrikizumab 9.8% 14.0% 5.1% 5.5% 8.2% 1.6% Difference (p=0.02) (p=0.03) (p=0.61) 11 NEJM 365:1088, 2011 Asthma: Beyond lebrikizumab Quilizumab (anti-M1 prime MAb) with potential for disease modification B cell Plasma cell

Protective responses BIgG

IgG Pneumococcus

Xolair (omalizumab) Anti-M1’ mAb

Allergic responses

IgE B IgE Reprogramming B cells to rid of allergic IgE 12 Allergen-challenge test with quilizumab Blocking allergen-induced increases in serum IgE levels

Challenge allergen IgE Non-challenge allergen IgE

400 400

300 300

200 200

(% baseline) 100 100 Allergen-specific IgE 0 0 -20 30 80 130 180 -20 30 80 130 180

Allergen challenge Placebo

Dose administration Quilizumab (RG7449)

13 Quilizumab development Summary

• Quilizumab (RG7449) was well tolerated in asthma patients

• Treatment with qulizumab: - Blocks allergen-induced increases in serum IgE levels - Improvement in allergen-induced lung function  Early asthmatic responses (EAR 26% decrease, 90% CI: 6%, 43%; P=0.046)  Late asthmatic response (LAR 36% decrease, 90% CI: -14%, 69%; P=0.21)

• Ongoing Phase IIb trial (COSTA, N=560) in moderate to severe asthma patients

• Ongoing testing and development of accompanying diagnostic

• Potential for: - Quarterly flat-dosing - Disease modification by reprogramming IgE response in asthma 14 Systemic Lupus Erythematosus Role of INF-alpha in SLE

Immune activation T cell

• Autoantibody production Bcell • Immune complex deposition • Cellular mediated toxicities Plasmacytoid IFNα 1-12 dendritic cells Dendritic cells

LUPUS ISM: Interferon signature metric • Kidney damage ISMLow ISMHigh • Rash • Arthritis Normal • Lupus Cytopenias • Nervous System % patients 0.0 0.1 0.2 0.3 0.4 0.5 -3 -2 -1 0 1 2 3 4 5 6 ISM Score 15 Rontalizumab development Summary

• Rontalizumab is an anti-IFNalpha IgG1 mAb discovered to neutralize all 12 IFNalpha’s

• Phase II ROSE trial - 238 patients with extrarenal lupus were enrolled - IV and SC cohorts : Rontalizumab vs placebo

• Accompanying diagnostic based on ISM score

• Primary endpoint: proportion of responders at week 24

Data to be presented at 2012 ACR (Washington, DC)

16 gRED Summary

• PHC-based model of drug discovery and development provides best opportunity to develop “best-in-disease” therapies

• Broad portfolio of biotherapeutics, small molecule inhibitors and antibody-drug conjugates to maintain oncology leadership

• Innovative portfolio of PHC-based therapies in asthma and emerging pipeline in lupus

• Positioned well to deliver innovative and differentiated therapies to improve patient’s lives

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