“Biogen Idec: Evaluating a Potential Acquisition”

1. “Biogen Idec: Evaluating a Potential Acquisition” Team Stratecore Abby Kowaloff Clay Quint Pasquale Cirone Reshma Singh Victor Fok YBPS Case Competition November 30, 2007

2. Agenda • MS Disease Overview • Therapeutic Landscape • Acquisition Evaluation • Opportunity Assessment • Plan of Action • Conclusion • Pfizer Competitive Strategy in MS

3. Multiple Sclerosis: Disease Condition • Disease: • Chronic inflammatory demyelinating CNS disease leading to impaired motor and sensory function • Frequency: • Most common debilitating illness in young adults • Indicence 0.5 – 1 % per 1000 people • Onset: age 20-50 (median: 24 years) • 350,000 – 500,000 pts US; over 1 million worldwide • Prognosis: • PPMS: often need walking assistance in 6-7 years • RRMS often maintain walking ability for 15-20 years post onset • 1/3 patients will work after 15 years

4. MS Therapies: Mechanisms of Action Blood brain barrier TYSABRI* macrophage B cell Autoreactive T cell Lymphocyte Lymphocyte Secrete antibodies COPAXONE AVONEX* BETASERON REBIF Destroy myelin NORMAL myelin BG12* Fingolimod Laquinmod Cladribine teriflunomide Demyelination MS

5. Changing MS Therapeutic LandscapeCrowded and moving towards oral therapies I.M. I.V. I.V. I.V. I.V. ORAL I.V. ORAL ORAL I.V. I.V. ORAL ORAL I.V. ORAL I.M. S.C. Expected Date to Market and Patent Expiration U.S. MS Drug Sales ($MM), 2006 Current Therapy Phase III Phase II

6. Is Biogen Worth Buying?Pipeline Assessment Phase Preclinical/ Phase I Market Discovery Phase II Phase III Pipeline AVONEX NPV: $5.0 B TYSABRI NPV: $236 MM Clinically Inferior BG-12 Cancer Indication/Injectable RITUXAN • Avonex is sole viable profit generator • Goes off patent in 2011 Clinically Inferior Daclizumab Already licensed CDP 323 Anti- LINGO-1 Early stage; high risk NgR-Fc

7. Biogen Market Cap (2007): ~$21 B Biogen Valuation: $5.3 B Epidemiologic Assumptions (RMRS): 20,000 new cases/year 25,000 incidence less other forms of MS, discontinued therapy, death, etc. Slow increase of % affected patients treated (+1%/yr) Commercial Assumptions Mid-range sales growth case Valuation only includes MS portfolio (~98% of 2006 sales) Adjusted according to year-by-year competitive landscape Terminal growth rate (post-2015): 3% (standard) Pfizer WTP (including premium): $7 B Pfizer Will Not Buy Biogen is Overvalued Overvalued!

8. Unlocking Synergies: $135 MM Pfizer/Biogen Collaboration • Pfizer strategic priorities: Compete in the MS space and expand presence in biologics • Proposal: Collaborate with Biogen on Anti-LINGO-1 or NgR-Fc • Novel mechanism to promote remyelination

9. Pfizer Competitive Strategy in MSPartnerships for the Future • No short-term licensing for oral immunomodulating therapies • BG-12 not likely to gain significant market share • Focus resources on remyelinating mechanisms • Capture future MS market to pre-empt competitor licensing moves • Investigate further indications for biologics • Collaborate to develop cell-based therapies

10. Questions?

11. Additional Slides

12. Future Competitive Landscape: Oral Therapies Dominate Biogen Anticipated Oral Drug Market Share Biogen Current Market Share

13. Restorative Strategies for MS

14. Mechanism of NgR-FC and Anti-LINGO-1