Cancer

We are discovering and developing antisense drugs to treat cancers both internally and through our partnerships with AstraZeneca and OncoGenex Technologies Inc. Cancer is an area of significant unmet medical need and an area in which our antisense technology provides us with unique advantages in discovering new drugs. Cancer is an extremely complex disease that involves a large number of targets. With our technology we can evaluate a very broad and diverse range of targets and identify their involvement in different types of cancers. Using the information we gain early in research on each of these targets, we can quickly identify the most promising targets for an anti-cancer drug. We select anti-cancer targets that provide a multi-faceted approach to treating cancer.

Our cancer pipeline consists of anti-cancer antisense drugs that act upon biological targets associated with cancer progression and/or treatment resistance. In 2012, we formed an anti-cancer alliance with AstraZeneca that supports our efforts to expand our anti-cancer efforts and supports an aggressive and broad clinical development plan for ISIS-STAT3_Rx. AstraZeneca brings significant experience and broad collaborations that enable the identification of novel genetic and epigenetic targets for cancer. Combining AstraZeneca’s expertise with our drug discovery technology, we plan to expand our cancer franchise with a number of promising new anti-cancer targets.

We believe the favorable tolerability and early evidence of clinical benefit of the anti-cancer drugs in our pipeline demonstrate how uniquely suited our technology is to create novel cancer therapeutics. In addition, we believe our generation 2.5 chemistry enhances the potency and effectiveness of our antisense drugs, and extends the applicability of our technology to cancers that are difficult to treat. For instance, we presented positive interim Phase 1 data on our generation 2.5 drug, ISIS-STAT3_Rx, in patients with advanced cancer who were refractory to prior chemotherapy treatment. In this interim analysis, we observed clear responses in these patients with an acceptable safety profile. Based on these data, we and AstraZeneca are currently evaluating ISIS-STAT3_Rx in a clinical study in focused patient populations with advanced cancer.

• Custirsen (Cancer)
• ISIS-EIF4E_Rx (Cancer)
• OGX-427 (Cancer)
• ISIS-STAT3_Rx (Cancer)
• ISIS-AZ1_Rx (Cancer)

Custirsen (OGX-011)

Custirsen, formerly OGX-011, now under license to Teva Pharmaceutical Industries Ltd., or Teva, is a second-generation antisense drug that targets clusterin, a secreted protein that acts as a cell-survival protein and is over-expressed in response to anti-cancer agents. We and OncoGenex jointly discovered and conducted the initial development of custirsen. In December 2009, OncoGenex licensed custirsen to Teva as part of a global license and collaboration agreement to develop and commercialize custirsen. Teva and OncoGenex are studying custirsen for use as an adjunct therapy to enhance the effectiveness of chemotherapy. Custirsen has shown promising results in combination with currently available chemotherapies in several tumor types. The FDA granted Fast Track Designation to custirsen for the treatment of metastatic prostate cancer in combination with docetaxel. OncoGenex has stated that the FDA has also agreed on the design of the SYNERGY trial, a Phase 3 trial evaluating custirsen, via the SPA process.

OncoGenex and collaborating investigators evaluated custirsen in five Phase 2 studies in combination with various cancer therapies for prostate cancer, non-small cell lung cancer, or NSCLC, and breast cancer. OncoGenex reported results from a randomized Phase 2 study of custirsen in patients with advanced metastatic castrate resistant prostate cancer, or CRPC. In this study, OncoGenex reported a median overall survival of 23.8 months in patients treated with custirsen plus docetaxel compared to 16.9 months for patients treated with docetaxel alone. In addition, OncoGenex reported that the unadjusted hazard ratio, a measure used to determine the difference in survival between treatment groups, was 0.61, representing a 39 percent reduction in the rate of death for patients treated with custirsen. OncoGenex also reported that patients treated with custirsen in combination with docetaxel tolerated custirsen well.

OncoGenex has also evaluated custirsen in a Phase 1/2 combination study in patients with NSCLC. In January 2012, OncoGenex reported that one- and two-year survival rates were 54 percent and 30 percent, respectively, and 12 percent of patients were still alive at a median follow-up of 41 months. The median overall survival was 14.1 months and progression-free survival was 4.3 months.

Teva and OncoGenex are collaborating on a global Phase 3 clinical program in patients with metastatic CRPC and metastatic NSCLC. OncoGenex and Teva are evaluating custirsen in two Phase 3 clinical studies for first- and second-line chemotherapy in patients with metastatic CRPC. OncoGenex and Teva are also evaluating custirsen in a Phase 3 study as a second-line treatment in patients with NSCLC. Teva and OncoGenex have completed enrollment for the SYNERGY study as a first-line treatment in patients with CRPC and expect results for the survival primary endpoint in the fourth quarter of 2013.

ISIS-EIF4E_Rx

ISIS-EIF4E_Rx targets the gene that is responsible for producing the protein eukaryotic initiation factor-4e, or eIF-4E, which cells over-express in a variety of cancers, including prostate, lung, ovarian, liver, breast, head and neck, bladder, colon, thyroid and lymphoma. eIF-4E facilitates the synthesis of factors in the body that support the development, growth, progression and survival of cancer. In preclinical studies, we and collaborators demonstrated marked anti-cancer activity in a broad range of animal models of cancer and provided the first in vivo evidence that tumor growth may be more susceptible to eIF-4E inhibition than growth of normal tissue. Targeting eIF-4E has been of great interest to the pharmaceutical industry and the oncology community. However the pharmaceutical industry considers eIF-4E a difficult protein to target with traditional pharmaceutical approaches.

Eli Lilly and Company completed a Phase 1 study of ISIS-EIF4E_Rx in patients with cancer that showed that the subjects tolerated the drug well at doses up to 1200 mg per week. Eli Lilly and Company has rights to license ISIS-EIF4E_Rx from us on predefined terms.

In 2010, we initiated a Phase 2 program of ISIS-EIF4E_Rx in patients with NSCLC and prostate cancer. The endpoints for both studies include progression-free survival, overall survival, response rates, time to progression and the reduction of a variety of biomarkers.

OGX-427

OGX-427 is a second-generation antisense drug targeting heat shock protein 27, or Hsp27, which is a cell survival protein that cells over-produce in response to many cancer treatments, including hormone ablation therapy, chemotherapy and radiation therapy. Studies have shown that increased Hsp27 production is prevalent in many human cancers, including prostate, NSCLC, breast, ovarian, bladder, renal, pancreatic, multiple myeloma and liver cancers. Studies have also linked increased Hsp27 production to faster rates of cancer progression, treatment resistance and shorter survival duration.

OncoGenex is evaluating OGX-427 in patients with cancer. In June 2010, OncoGenex reported results from a Phase 1 study of OGX-427 in patients with a variety of cancers. In this study, patients treated with OGX-427 as a monotherapy and in combination with docetaxel tolerated the drug well. In addition, OGX-427, when used as a single agent, demonstrated declines in circulating tumor cells at all doses and in all types of cancer OncoGenex evaluated. OGX-427 also demonstrated evidence of reduction in tumor markers defined as declines of prostate-specific antigen, or PSA, levels in prostate cancer and cancer-antigen-125 levels in ovarian cancer.

In February 2012, OncoGenex reported preliminary results from a Phase 1 study in patients with superficial bladder cancer. In this study, OncoGenex reported that treatment with OGX-427 resulted in a trend towards decreased levels of Hsp27 and increased tumor cell death rates.

OncoGenex is also evaluating OGX-427 in a Phase 2 study for the first-line treatment of metastatic bladder cancer and in two Phase 2 studies for the treatment of metastatic CRPC. In September 2012, OncoGenex reported preliminary results from a Phase 2 study in patients with CRPC. In this study, OncoGenex reported that treatment with OGX-427 in combination with prednisone resulted in a higher number of patients without disease progression at 12 weeks and greater declines in prostate-specific antigen, or PSA, and circulating tumor cells compared to patients treated with prednisone alone.

ISIS-STAT3_Rx

ISIS-STAT3_Rx is designed to treat cancer by inhibiting the production of a gene critical for tumor cell growth and survival. Signal transducer and activator of transcription 3, or STAT3, is over-active in a variety of cancers, including brain, lung, breast, bone, liver and multiple myeloma and promotes tumor cell growth and prevents cell death.

In 2012, we licensed ISIS-STAT3_Rx, also referred to as AZD9150, to AstraZeneca as part of a broad alliance to discover and develop anti-cancer drugs. We are eligible to receive up to $75 million in milestone payments over the next two years, including up to a $50 million milestone payment subject to meeting pre-agreed efficacy and safety criteria in the ongoing ISIS-STAT3_Rx study. We are also eligible to receive double-digit royalties on sales of ISIS-STAT3_Rx.

ISIS-STAT3_Rx is our first drug to incorporate our new generation 2.5 chemistry. We believe the significant potency we observed in our preclinical studies with ISIS-STAT3_Rx broadens the therapeutic opportunities for ISIS-STAT3_Rx into many different types of cancer where STAT3 is implicated. Our initial focus is to evaluate ISIS-STAT3_Rx in hematologic malignancies, such as lymphoma. Together with AstraZeneca, we have designed a development plan that could allow for a rapid path to the market in these patient populations. In parallel, AstraZeneca is planning to initiate a broad Phase 2 program for ISIS-STAT3_Rx with additional clinical studies in 2013 or early 2014.

In preclinical studies, ISIS-STAT3_Rx demonstrated antitumor activity in animal models of human cancer with an attractive safety profile. In 2012, we reported Phase 1 data showing that treatment with ISIS-STAT3_Rx produced an acceptable safety profile and resulted in sustained responses in two of three patients with advanced diffuse large B cell lymphoma who were refractory to multiple prior chemotherapy treatments. Together with AstraZeneca, we are currently evaluating ISIS-STAT3_Rx in two Phase 1b/2a clinical studies in patients with hepatocellular carcinoma and advanced lymphomas. Because STAT3 is over expressed in numerous types of cancers, ISIS-STAT3_Rx has the potential to be broadly useful for both solid and hematological tumors.

ISIS-AZ1_Rx

ISIS-AZ1_Rx is an antisense drug to an undisclosed target designed to treat cancer. ISIS-AZ1_Rx is a generation 2.5 drug and the first drug to arise from a research program and enter development under our partnership with AstraZeneca. We granted AstraZeneca an exclusive license to develop and commercialize ISIS-AZ1_Rx. We are responsible for developing ISIS-AZ1Rx through completion of IND-enabling toxicology and will receive milestone payments from AstraZeneca as ISIS-AZ1_Rx advances in development. We are also eligible to receive double-digit royalties on sales of ISIS-AZ1_Rx.