NON – CONFIDENTIAL

Collaboration with Neurocrine Biosciences toDevelop Novel Muscarinic Receptor Agonists
For Schizophrenia and Other Neuropsychiatric Disorders
2021 | © Sosei Group Corporation

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Today we are joined by Dr. Eiry Roberts, CMO at Neurocrine
DR. EIRY ROBERTS
CHIEF MEDICAL OFFICER▪ Appointed Chief Medical Officer in January 2018 and is responsible for all clinicaldevelopment and medical affairs activities at Neurocrine.
▪ Over 25 years of research and development experience in the pharmaceuticalindustry across all phases of drug development from research throughcommercialization in multiple therapeutic areas, including neuroscience,
inflammation, oncology and metabolic diseases.
▪ Joined Neurocrine from Eli Lilly and Company where she had worked since May
1991, holding various positions of increasing responsibility, including Vice President,
Clinical Pharmacology/Managing Director of Chorus (October 2014 to December2017) and Vice President of R&D, BioMedicines Business Unit.

▪ Trained physician in pharmacology and medicine in the UK, qualifying from theUniversity of London in 1987. Her post-graduate clinical training was in clinicalpharmacology and cardiology at St. Bartholomew’s Hospital and the Royal London
Hospital.
▪ Also serves as a director of Amicus Therapeutics, a clinical-stage biopharmaceuticalcompany focused on rare diseases.

3

Announcing our up to US$2.7 billion collaboration with Neurocrine
Developing novel muscarinic receptor agonists for schizophrenia and other neuropsychiatric disorders

1

Neurocrine gains rights to a portfolio of potential best-in-class selective muscarinic
receptor agonists in development for the treatment of major CNS disorders

Licensed Portfolio

M4 agonists

2

Sosei Heptares receives US$100 million upfront which will likely be recognized as
Revenue in FY2021

3

Sosei Heptares to receive ongoing R&D funding and up to US$1.5 billion in potential
development and regulatory milestones, up to US$1.1 billion in commercial
milestones, plus tiered up to mid-teen percentage royalties on net sales

4Sosei Heptares also retains the rights to develop all muscarinic M1 agonists inJapan in all indications, with Neurocrine receiving co-development and profit shareoptions

Latest major strategic partnership executed by Sosei Heptares

4(Global)

Dual M4/M1 agonists(Global)M1 agonists(ex-Japan)

Neurocrine is a leading neuroscience-focused biopharmaceuticalcompany…
Flagship Japan-based partners of Neurocrine• Incorporated in 1992, IPO in 1996 (Nasdaq:NBIX),
with current market capitalization of ~US$10bn• Exclusive collaboration and licensing agreement to develop andcommercialize valbenazine (INGREZZA®) for movement
disorders in Japan and other select Asian markets• First product approved in 2017 – INGREZZA®
(valbenazine) indicated for Tardive Dyskinesia• NBIX retained full commercial rights in North America, Europeand other countries outside of Asia

• Focused on discovery and development of novel
therapeutics for CNS and endocrine diseases• Headquartered in San Diego, California withapproximately 900 employees
Global and Regional Partnerships

March 2015

• Strategic collaboration to develop and commercialize
compounds in Takeda’s early-to-mid stage psychiatry pipeline• NBIX received exclusive license for seven Takeda pipeline
programs, including three clinical stage assets for schizophrenia,
treatment-resistant depression and anhedonia
June 2020

Strong history of partnering with Japan’s leading science-led major pharmaceutical companies

5

…well-positioned for sustained and long-term growth
Strong Commercial Capabilities
Experienced Sales TeamR&D Focus on Neurological,Endocrine, and Psychiatric Disorders

Strong Financial
Position

4 Approved Products*
INGREZZA® Blockbuster Status
ONGENTYS® Launched Q3 2020‡

Robust Pipeline
12 Mid-to-Late-Stage Programs
Nearly 50 Clinical Development,
Health Economic and Outcomes
Research Studies Underway
Over $1.2B Cash and Investments(as of 30-Jun-2021)

Generating Healthy Free Cash Flow

Neurocrine’s long-term growth story to be further enhanced from its collaboration with Sosei Heptares*AbbVie has global commercial rights to Orilissa® and Oriahnn®
‡ Under License from BIAL

6Collaboration with Neurocrine may have a material positive
financial impact on our full year FY2021 revenues• Transaction subject to customary closing conditions,
including clearance under the Hart-Scott-Rodino US
Antitrust Improvements Act• Transaction anticipated to complete by 31-Dec-2021• US$100 million upfront payment recognized as
Revenue in FY2021• Anticipated M4 Phase 2 start in 2022, plus the potential
for an IND application (M1/M4 dual and/or M1 agonists)over the next 24-36 months• Successful achievement of each development milestone
event may result in the receipt of further materialmilestone payments

Alliance with Neurocrine
Biosciences (2021)

Former Alliance withAllergan (2016)

Upfront License
Payment

US$100m

US$125m

Ongoing R&D Funding

Undisclosed

US$55mDevelopment andRegulatory Milestones

Up to US$1.5bn

Up to US$665m

CommercialMilestones

Up to US$1.1bn

Up to US$2.5bn

Royalties

Tiered up to mid-teen %royalties

Up to double-digit
tiered royalties

Japan Territory Rights

M1 agonist for allindications

M1 agonist for Dementia
with Lewy Body (DLB)

Neurocrine is a well funded, highly motivated partner to develop the novel Muscarinic agonist programs

7Portfolio of Muscarinic Agonist programs regained.
Sosei Heptares conducts rapid strategic review of all
preclinical and clinical data

FEB 2021

Sosei Heptares presents its proprietary scientificknowledge of the programs to potential partners at J.P.
Morgan Healthcare Conference

Sosei Heptares Board decides on targeted investment inclinical development of selected Muscarinic programs

OCT 2021

JAN 2021

New collaborators value our science-led focus and proprietary
insights into programs created from our StaR®/SBDD approach

Sosei Heptares completes expansive scientific and clinicaldiligence process with Neurocrine

A2aantagonists

CGRPantagonists

Muscarinicagonists

2012

2015

2016

Regained due to change
in partner strategy

Regained due to change
in partner strategy

Regained due to change
in partner strategy

Sosei Heptares commences discussions with world leading
neuroscience companies, including Neurocrine

Sosei Heptares and Neurocrine announce collaboration todevelop novel muscarinic receptor agonists

2015

Re-partneredRe-partneredRe-partneredPP

P

2020

2021

Our scientific leadership and proprietary insights have enabled another exciting collaboration

8Neurocrine is committed to delivering a transformative treatment
for Schizophrenia with the M4 agonist HTL-0016878
Large addressable market withblockbuster sales profiles…

~20M

Schizophrenia patientsworldwide

Blockbusters sales profiles despite
limited efficacy and severe side effects$10BN+$13BN+(2020)(2026)…Limited innovationin 70 years
Current treatments use the samemechanism of action from the 1950s

1st GenD2 modulating

Atypicals

Dual D2/5HT
modulating

2nd Gen
Atypicals

Dual D2/5HT
modulating

Huge opportunity for M4agonists including HTL-0016878
PHighly selective M4 agonists

Potential Best-in-Class therapy
Pwith a novel mechanism
P

Improved tolerability

P

Significant need for new
treatment options

The current standard of care can be improved. Selective M4 agonism represents a unique opportunity
Source: World Health Organization; EvaluatePharma

9Similarly, we are committed to delivering high-quality, science-led
programs for major CNS disorders under the collaboration
PreclinicalSosei Heptares initially responsible for thecompletion of any ongoing or future

preclinical activities
for the M1/M4 dual and M1 agonists

Early clinicalSosei Heptares may also carry out thePhase 1 clinical trialsof M1/M4 dual and M1 agonists

Late stage clinical
Neurocrine will be solely responsible for all
future development, regulatory andcommercialization activities for M4,
M1/M4 dual and M1 (ex-Japan) agonists

Neurocrine will reimburse Sosei Heptares for research activities required for an IND
submission, as well as Phase 1 activities

We are initially responsible for advancing multiple earlier stage preclinical programs for novel M1/M4 dual andM1 agonists under the funded research collaboration with Neurocrine10We have retained Japan territory rights to all M1 agonists in allindications including dementia, which is a high social priority
Sosei Heptares retains the right to develop and commercialize
all M1 agonists in Japan in all indications. Sosei Co. Ltd in Japan
will be responsible for any development and commercialization of
the M1 agonist programs

Number of dementia patients in Japan set to growas a result of a significantly ageing population
Number of Dementia patients in Japan(million)

109

Neurocrine and Sosei Heptares will share access to global
safety data and certain clinical data necessary forinclusion in regulatory filings(Forecast)
7.48Japan

Peak sales ofbranded donepezil(2011)132%
68%

Peak sales of branded Donepezil inJapan was US$1.4 bn in 2011

765

4.6

11%

Sales of all drugs(2011)14
3

Neurocrine has two opt-in triggers to co-develop andco-commercialize the M1 assets in Japan: before commencing,
and after receiving topline data from the first Phase 2 POC study

Ex-Japan

89%

211%

1

Dementia
Population (2021)

02012

2030

89%

Neurocrine have the right to opt-in and co-develop and/or profit share on our Japanese M1 agonist program(s)Source: World Health Organization, Alzheimer’s International, Evaluate Pharma, Transitions in Pharmaceutical Market, Production and Sales in Japan (1980–2010), MHLW
1 2011 chosen as it was a peak sales year for branded donepezil in Japan. The global patent for donepezil expired in 2011.

11

Conclusion
1

Collaborating with Neurocrine – a highly motivated world-leading neuroscience-focused biopharma company
and the perfect partner to advance the portfolio of potential best-in-class, selective muscarinic receptor agonists

2Sosei Heptares’ latest major partnership – highly attractive financial terms – US$100m upfront and up to US$2.6
billion in potential economics, plus tiered up to mid-teen royalties

3

Neurocrine anticipate initiating a Phase 2 study in 2022 for the treatment of schizophrenia with HTL-0016878, themost advanced program. Sosei Heptares to jointly advance multiple preclinical M1/M4 and M1 agonist programs

4

Retaining rights to develop all M1 agonists in Japan in all indications, with Neurocrine receiving co-developmentand profit share options

5Significant opportunity to address high unmet medical need across major neuropsychiatric disorders

The collaboration leverages the strengths of both organisations with one goal in mind –to bring important medicines to patients who need better treatment options
12Appendix

13

HTL-0016878 is a 4th-generation candidate aiming to be a highly
effective and safer treatment for Schizophrenia
Efficacy

SafetyPositive
symptoms

Negative
symptom

Cognitive
impairment

Extrapyramidal
symptoms**

Weight gain

MoA

Typical medicine

Peak sales
exampleGeneration

Number of patients
20M*

Number of patients
11.5M*

Number of patients
16M*--

Typicalantipsychotic

D2 AntHaldol(Historic dataunavailable)

1st+++--+++++

Atypical
antipsychotics

D2 Ant+5-HT Regulator

Zyprexa
RisperdalLatuda

Zyprexa$5,000M+(2010)

2nd+++++++++++

D2 partial Ag+
5-HT Regulator

Abilify
REXULTI
VraylarAbilify$6,100M+(2013)

3rd+++++++

M4 Agonist***KarXT
CVL-231
HTL’878-

4th+++++++--

After regaining the program in early 2021, HTL-0016878 has been rapidly positioned to advance with our newpartner Neurocrine
14*As 1 patient can have several symptoms, number of patients in 3 symptoms is overlapping**Drug-induced movement disorders including involuntary or uncontrollable movements. tremors. muscle contractions. It is said to be related with D2 receptor occupancy balance.
***Expected efficacy and expected safety derived from ongoing clinical trials of KarXT and CVL-231.
Source：P T. 2014 Sep; 39(9): 638–645, J Clin Psychiatry. 2010;71(3):280–286, Schizophr Bull. 2010 Jan; 36(1): 36–42 and EvaluatePharmaNeurocrine’s pipeline prior to collaboration with Sosei Heptares

Psychiatry

Endocrinology

Neurology

PROGRAM

INDICATIONPHASE 2

PHASE 3

PARTNER

2021 UPCOMING MILESTONES

valbenazine*

Tardive Dyskinesia (Japan)

Filed Marketing Authorization

MTPC Submitted Marketing Authorization
with Ministry of Health & Welfare in Japanvalbenazine*

Chorea in Huntington Disease

Registrational

Top-Line Data Expected by Year-End

valbenazine*

Dyskinesia Due to Cerebral Palsy

Registrational

Initiating Registrational Study in 2H 2021

NBI-827104

Rare Pediatric Epilepsy: CSWS

Ongoing Phase 2 Study

NBI-827104

Essential TremorOngoing Phase 2 Study

NBI-921352

Rare Pediatric Epilepsy: SCN8ADEE

Initiating Phase 2 Study in 2H 2021

NBI-921352

Focal-Onset Seizures in Adults

Initiating Phase 2 Study in 2H 2021

crinecerfont

Congenital Adrenal Hyperplasia(Adults)

Registrational

Ongoing Registrational Studycrinecerfont

Congenital Adrenal Hyperplasia(Pediatric)

Registrational

Ongoing Registrational Study

valbenazine*

Adjunctive Treatment of
Schizophrenia

Registrational

Initiating Registrational Study in 2H 2021

luvadaxistat (NBI-1065844)

Cognitive Impairment Associatedwith Schizophrenia (CIAS)

Initiating Phase 2 Study in 2H 2021

NBI-1065845

Inadequate Response to Treatment
in Major Depressive Disorder

Initiating Phase 2 Study in 2H 2021

NBI-1065846

Anhedonia in Depression

Initiating Phase 2 Study in 2H 2021

CSWS = Epileptic Encephalopathy with Continuous Spikes and Waves During Sleep
Neurocrine Biosciences has global rights, unless otherwise noted.
*Mitsubishi Tanabe Pharma Corporation has commercialization rights in East Asia.

15PHASE 1

Denotes program/study to be Initiated in 2021

IR@soseiheptares.com

SOSEI HEPTARESPMO Hanzomon 11F

Steinmetz Building

North West House2-1 Kojimachi, Chiyoda-ku

Granta Park, Cambridge

119 Marylebone RoadTokyo 102-0083

CB21 6DG

London NW1 5PU

Japan

United Kingdom

United Kingdom

www.soseiheptares.com@soseiheptaresco@soseiheptaresco@soseiheptaresco