Merrill Lynch's Global Pharmaceutical, Biotechnology, and ...library.corporate-ir.net/library/12/121/121703/items/230367/Arena... · Merrill Lynch's Global Pharmaceutical, Biotechnology,

Merrill Lynch's Global Pharmaceutical, Biotechnology, and Medical Device ConferenceFebruary 7, 2007

2Arena Pharmaceuticals, Inc. - ARNA - www.arenapharm.com

Information related to forward-looking statements

This presentation includes forward-looking statements that involve a number of risks and uncertainties. Such forward-looking statements include statements about the potential of ourcompounds, when, whether and how we expect to continue developing compounds, including lorcaserin, APD125, APD791 and our partnered compounds, upcoming milestones and news, potential drug candidates, the therapeutic potential of GPCRs, our strategy, technologies, preclinical and clinical programs, our ability to identify and develop drugs, future opportunities, potential achievements, goals and expectations, and other statements that are not historical facts, including statements which may be preceded by the words “potential,” “believe,” “expect,” “predict,”“continue,” “likely,” “unlikely,” “anticipate,” “estimate,” “optimistic,” “sustainable,” “intend,” “plan,”“project,” “target,” “aim,” “will,” “may,” “unlikely to be,” and similar words. For such statements, we claim the protection of the Private Securities Litigation Reform Act of 1995. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the time they were made.

Actual results could differ materially from our forward-looking statements due to, among other reasons, preclinical and clinical development is highly uncertain, the success and cost of our research, clinical studies and partnering endeavors, our ability to obtain additional financing, our clinical trials may not proceed at the time we expect or at all, the timing of payments and fees, if any, from our collaborators, and our ability to obtain and defend patents. Additional factors that could cause actual results to differ materially from those stated or implied by our forward-looking statements are disclosed in our SEC filings. We disclaim any intent or obligation to update these forward-looking statements, other than as may be required under applicable law.


Focused on discovering, developing & commercializing innovative oral drugs

Lorcaserin for obesityPhase 3 “BLOOM” trial underway

Emerging pipeline of NMEsOral medicines for large, primary care markets

Attractive partnershipsOrtho-McNeil and Merck

Integrated R&D infrastructureFocused on GPCR targets

Multiple expected near-term milestonesDSMB report for lorcaserin


G Protein-Coupled ReceptorsBroad therapeutic potential

Cell surface receptors that mediate majority of cell-to-cell communication

Hundreds of GPCRs not targeted by current drugs

Selective targeting of specific GPCRs

Maximizes likelihood of intended pharmacology

Minimizes risk of “off target” effects

Validated target class

~40% or more of all drugs target GPCRs


*Representative of Arena’s research programs.

Program / Indication Phase 3Phase 2Phase 1PreclinicalResearch*

Type 2 diabetes & obesity

Wakefulness promoter

Cardioprotection

Cytokine & immune cell modulators

APD791Thrombosis

MK-0354Undisclosed indication

Merck

LorcaserinObesity

APD125Insomnia

APD668Type 2 Diabetes

Next IND Candidate

Ortho-McNeil

Niacin Receptor Agonists MerckHDL

Pipeline of promising drug candidates


Lorcaserin is a promising oral drug candidate for obesity

BLOOM trial initiated September 2006

Pivotal two-year trial of 3,182 patients

Phase 2 trials of over 800 patients showed:Progressive, meaningful and dose dependent weight lossHigh rate of responseWell-tolerated

References1. Adults 20+over, Center for Disease Control & Prevention, 20062. Estimated annual cost, Center for Disease Control & Prevention, 20023. Deaths in 2000, World Health Organization, 2005

Market Need• More than 30% of Americans are obese1

• Economic cost: $117 billion in the U.S. per year2

• Obesity accounts for +2.6 million deaths worldwide3


Lorcaserin is a novel and selective compound

5-HT2C receptor is a validated target

Located in the hypothalamus

Regulates satiety

May affect metabolic rate

NME that selectively targets the 5-HT2C receptor

~100-fold selectivity over 5-HT2B receptor

~15-fold selectivity over 5-HT2A receptor

Fenfluramine is a non-specific serotonin receptor agonist

Potential to activate all 14 known serotonin receptors

Removed from the market in 1997


LorcaserinComparison of Lorcaserin and Dexfenfluramine

3011Half Life (hr)

267.7232.2Molecular Weight

2601124

1901000

11

EC-505-HT2A (nM)5-HT2B (nM)5-HT2C (nM)

Dexfenfluramine*Lorcaserin

*The EC-50 data for dexfenfluramine are those of nordexflenfluramine, the active metabolite of dexfenfluramine.


Highly significant weight loss and reduction in BMI and waist+hip circumferenceWell tolerated with no apparent drug effects on heart valves or pulmonary artery pressures; 71% retention rate

Results

Echocardiograms at baseline and end of studyEcho

4 parallel groupsNo diet or exercise advice10 mg, 15 mg & 20 mg daily dose for 12 weeks

Design

469Patients

December 2005Completed

12-Week Trial

Lorcaserin Phase 2b trialDemonstrated significant weight loss


Lorcaserin Phase 2b trialDose-dependent & progressive weight loss

Weight ChangeFrom

Baseline (kg)

15 30 45 60 75 90 105

-4

-3

-2

-1

0

Placebo

Lorcaserin10 mg

Lorcaserin15 mg

Lorcaserin20 mg

***

****

**

**

**

**

**

**

**

**

** **

**

**

*

**

←stop study drug

*p=0.002; **p<0.001mean ± semCompleter subset analysis

Study Day


Lorcaserin Phase 2b trialSignificant number of patients lost ≥ 5% from BL

0

5

10

15

20

25

30

35

% of Patientswith

≥ 5% Weight Loss

Placebo 10 mg 15 mg 20 mg

*p=0.015; **p<0.001Completer subset analysis

**

*

**


Lorcaserin Phase 2b trialHigh response rate & dose-dependent weight loss

-15

-10

-5

0

5

% wtchange

-15

-10

-5

0

5

-15

-10

-5

0

5

-15

-10

-5

0

5

Placebo Lorcaserin 10 mg

Lorcaserin 15 mg Lorcaserin 20 mg

% wtchange

% wtchange

% wtchange


Lorcaserin Phase 2bGenerally well tolerated at doses investigated

Adverse Events (>5% of Patients in Any Group)

3.41.73.45.1Dyspepsia

5.25.12.64.2UTI

5.21.71.70.8Vomiting4.35.94.32.5Fatigue3.44.20.95.9Diarrhea6.01.71.70Dry Mouth6.05.95.18.5Nasopharyngitis3.43.41.79.3URI7.87.66.00Dizziness

11.29.38.53.4Nausea

26.732.229.917.8Headache

20 mg15 mg10 mg PlaceboAdverse Event


Lorcaserin Phase 2b trial No greater FDA valvulopathy incidence in lorcaserin group

Lorcaserin

0.7%2.0%By Treatment

--2.1%--2.0%By Dose

--1 (mild to mild-mod)--

2(1 mild to mod)

(1 mild to mild-mod)Mitral (M) Regurgitation

--1(trace to mild) ----Aortic (A) Regurgitation

20 mg(n=96)

15 mg(n=96)

10 mg(n=99A, 100M)

Placebo(n=99)

FDA valvulopathy (≥ Mild AR; ≥ Moderate MR) rate higher in placebo vs. combined lorcaserin groups

No two-category shifts; One category shifts uniformly distributed

No evidence in preclinical studies of effects on heart valves or pulmonary vasculature after up to 12 months at high doses


Market 2010

Registration plan for lorcaserin

2-year BLOOM Pivotal Phase 3

2009200820072006 2010

Other Phase 3 Studies

1-year Pivotal Phase 3

1-year Pivotal Phase 3

NDA 2009


APD125A promising oral drug candidate for insomnia

Selective MOA: may lead to fewer side effects

Phase 1: evidence of improved sleep maintenance

Emerging attractive tolerability profile

APD125 to enter Phase 2 trial

References1. Institute of Medicine, 20062. Data Monitor, 2005

Market Need• 50-70 million Americans suffer from a sleep disorder1

• Patients with sleep disorders are at higher risk of health effects1

• Insomnia is a multi-billion market2 despite low awareness about the burden of sleep loss among the general public1


Market Need• 2005 worldwide sales of Plavix totaled $5.9 billion1

• The second best selling drug worldwide1

References1. IMS Health, Inc.

APD791 for arterial thrombosis

Highly selective 5-HT2A receptor inverse agonist inhibits serotonin-mediated thromboembolic processes

Potential to improve therapeutic indexImproved separation of inhibition of thrombosis vs. increased bleeding relative to existing therapies (preclinical data)

Phase 1 start pending completion of preclinical studies


GDIR agonists are first-in-class therapeutics targeting a novel pancreatic beta cell receptor

Orally active compounds stimulate insulin release without causing hypoglycemia

Activation of GDIR may have both acute and long-lasting beneficial effects on insulin release

Lead compound APD668 in Phase 1

Ortho-McNeil diabetes partnershipGDIR agonists for type 2 diabetes

References1. International Diabetes Federation, 20062. Center for Disease Control and Prevention, 20003. Center for Disease Control and Prevention, 2002

Market Need• Diabetes affects ~200 million people worldwide1

• Diabetes is the sixth-largest cause of death in the U.S.2

• One million new cases of diabetes are diagnosed each year 3


Merck niacin receptor partnershipAgonists for atherosclerosis & other disorders

References

1. American Heart Association

Market Need• Atherosclerosis is implicated in about 3/4 of all deaths from

cardiovascular disease1

• According to AHA, higher HDL is better1

• About 26% of the U.S. population has HDL <40mg/dL1

Three novel GPCR targets for atherosclerosis and other disorders

Targets believed to play role in regulating plasma lipid profiles

Phase 1 trial program generally well tolerated at all doses

$82.5 Million pre-commercial payments plus royalties


Arena finances For the nine months ended Sept. 30, 2006 (in millions)

Total RevenuesExpenses:Research and developmentGeneral and administrativeAmortization of acquired technologyTotal operating expenses

Interest and other income, net

Net loss Allocable to Common Stockholders

Balance Sheet Data:Cash, cash equivalents and short-term investmentsTotal Assets

Total Stockholders’ Equity

$25.9

65.313.2

1.279.7

3.5

$(51.9)

$250.8331.2

$235.3

* Prior 12/31/06 guidance for cash, cash equivalents and short-term investments, plus net proceeds from December 2006 financing $378-385

*


Expected upcoming events

DSMB month 6 report from BLOOM trial

Initiate APD125 Phase 2 chronic insomnia trial

Initiate APD791 Phase 1 clinical trial

Announce next IND candidate

Announce progress on partnered programs-- Ortho-McNeil and Merck

Obesity

Insomnia

Thrombosis

Partnered

Pipeline

Merrill Lynch's Global Pharmaceutical, Biotechnology, and Medical Device ConferenceFebruary 7, 2007

Documents

Merrill Lynch's Global Pharmaceutical, Biotechnology, and ...library.corporate-ir.net/library/12/121/121703/items/230367/Arena... · Merrill Lynch's Global Pharmaceutical, Biotechnology,