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F A S T E R , S A F E R , S I M P L E R S U R G E R Y

Terrence Norchi, M.D.President - CEO

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Cautionary Statement Regarding Forward-Looking Statements This  presenta,on  includes  forward-­‐looking  statements.    We  make  forward-­‐looking  statements,  as  defined  by  the  “safe  harbor”  provisions  of  the  Private  Securi,es  Li,ga,on  Reform  Act  of  1995,  and  in  some  cases,  you  can  iden,fy  these  statements  by  forward-­‐looking  words  such  as  “if,”  “shall,”  “may,”  “might,”  “will  likely  result,”  “should,”  “expect,”  “plan,”  “an,cipate,”  “believe,”  “es,mate,”  “project,”  “intend,”  “goal,”  “objec,ve,”  “predict,”  “poten,al”  or  “con,nue,”  or  the  nega,ve  of  these  terms  and  other  comparable  terminology.    These  include  statements  regarding:  our  ability  to  leverage  our  technology  plaLorm  in  the  development  of  our  lead  and  poten,al  pipeline  product  candidates;  our  ability  to  design  and  conduct  development  ac,vi,es  and  studies  and  clinical  trials  for  our  lead  and  poten,al  pipeline  product  candidates;  the  poten,al  ,ming  and  results  of  any  such  clinical  trials  we  may  conduct;  our  ability  to  obtain  regulatory  approvals  in  order  to  market  any  planned  products;  our  ability  to  achieve  financial  projec,ons;  and  our  ability  to  achieve  milestones.  The  forward-­‐looking  statements  in  this  presenta,on  are  based  on  management’s  current  expecta,ons,  es,mates,  forecasts  and  projec,ons  about  the  Company  and  its  business,  all  of  which  could  prove  to  wrong.  Because  such  statements  deal  with  future  events,  they  are  subject  to  various  risks  and  uncertain,es  and  actual  results  for  our  current  and  future  fiscal  years  could  differ  materially  from  the  Company's  current  expecta,ons.  Factors  that  could  cause  the  Company's  results  to  differ  materially  from  those  expressed  in  forward-­‐looking  statements  include,  without  limita,on,  the  following  risks:  we  have  es,mated  that  we  will  have  sufficient  cash  to  operate  our  business  through  November  2014,  and  we  may  not  be  able  to  obtain  sufficient  financing  and/or  establish  necessary  rela,onships  with  third  par,es  to  con,nue  to  pursue  our  business  plan;  the  stockholder  dilu,on  that  may  result  from  future  capital  raising  efforts  and  the  exercise  or  conversion,  as  applicable  of  Arch’s  outstanding  op,ons  and  warrants;  an,-­‐dilu,on  protec,on  afforded  investors  in  prior  financing  transac,ons  that  may  restrict  or  prohibit  Arch’s  ability  to  raise  capital  on  terms  favorable  to  the  Company  and  its  current  stockholders;  any  development  ac,vi,es  or  clinical  trials  we  may  conduct  may  not  produce  favorable  results;  regulatory  agencies  may  require  that  we  undertake  addi,onal  or  more  costly  studies  or  clinical  trials  than  we  presently  an,cipate;  we  may  never  gain  regulatory  approval  for  any  of  our  product  candidates;  we  may  not  be  able  to  protect  our  intellectual  property  rights;  the  intellectual  property  of  others  and  any  asserted  claims  of  infringement;  general  business  and  economic  condi,ons  may  limit  our  ability  to  obtain  necessary  capital;  the  consequences  of  compe,,ve  factors  in  the  industry  in  which  we  operate  may  restrict  the  success  of  any  product  candidate  we  are  able  to  commercialize,  and  we  may  not  be  able  to  a\ract  or  retain  key  personnel.  More  detailed  informa,on  about  us  and  the  risk  factors  that  may  affect  the  realiza,on  of  any  forward-­‐looking  statements  is  set  forth  in  our  filings  with  the  Securi,es  and  Exchange  Commission,  including  our  Annual  Report  on  Form  10-­‐K  filed  on  December  12,  2014  and  subsequent  filings  with  the  SEC  .  Such  documents  may  be  read  free  of  charge  on  the  SEC’s  internet  site  at  h\p://www.sec.gov.  You  are  cau,oned  not  to  place  undue  reliance  on  any  forward-­‐looking  statements  we  make  in  this  presenta,on  given  these  risks  and  uncertain,es,  and  all  such  statements  are  qualified  in  their  en,rety  by  this  cau,onary  statement.  All  forward-­‐looking  statements  speak  only  as  of  the  date  hereof,  and  we  undertake  no  obliga,on  to  revise  or  update  any  forward-­‐looking  statement  to  reflect  events  or  circumstances  acer  the    date  hereof,  except  as  otherwise  required  by  law.  

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Highlights

Investment Themes Potential high margin (~biopharma) novel product entering a growing $5B market in early 2016 with relatively low (device) capital requirements

First Planned Product AC5 Surgical Hemostatic DeviceTM; simple, effective, versatile, safe

Unique Technology MIT-licensed self-assembling peptide creates hemostatic barrier on wound

Recent News

Animal studies efficacy in presence of “blood thinners” faster time to stop bleeding vs branded hemostats of varying mechanisms

Safety study -no sign of interaction with human cell receptors or cell kinase enzymes Medical device pathway confirmed in Europe

Activities Scale-up, biocompatibility, initiate first human trial

Pipeline Potential Applications in surgery, trauma, wound care, military medicine, other

OTCQB ARTH

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Liver Hemostasis

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The Burden of Bleeding

Bleeding is common in open / laparoscopic surgery 30-50% of procedure time can be spent controlling bleeding Visual field loss and increased error risk Increased length of stay Use of expensive resources (transfusions cost $500-1000/unit) Abnormal healing, adhesions Hematomas and seromas

Cautery and biomaterials present safety, efficacy, ease of use challenges

Anticoagulant / antiplatelet therapy increases bleeding risk

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Market Opportunity

Hemostat and sealant worldwide market revenues

are projected to grow from $4.5B in ’13 to $6.7B in ’17

(10% annual growth)  

Cardiovascular51.4

General Surgery27.4

Cosmetic12.6

Neurological16.0

Source: MedMarket Dilligence, LLC; “Surgical Sealants, Glues Worldwide.”

Surgical Procedures with Potential for the Use ofHemostats, Sealants, Glues and Adhesion Prevention

Products, Worldwide (Millions). 2011

Urological1.4

Digestive20.9

Orthopedic& Arthroscopic

10.7

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Competition: No Ideal Solution

Cautery

Gelatin

Collagen

Cellulose

Polymers

Thrombin

Fibrin sealants

Product Classes

Unreliable, slow onset of action

Foreign body reaction, infection, granuloma

Inflammatory responses

Adhesions

Difficult to prepare and use

Intact clotting cascade required

Animal/human sourcing

Handling restrictions

Antibody formation  

Common Drawbacks

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Planned Advantages of AC5

Physicians desire these characteristics

• No special storage requirements or supply • Easily prepared and applied • Not sticky, not powdery, not bulky, does not gunk-up instruments • Supports clear visual field

Simple  

• Provides rapid, reliable hemostasis • Conforms to irregular wound geometry to create a barrier that stops leakage •  Integrates easily into procedure

Effec,ve  

• Open and minimally invasive surgery • Works in range of bodily fluids and tissues • Prophylactic effects; may control local bleeding while operating through it

Versa,le  

• Made of natural building blocks without animal or human constituents • Biocompatible, inert, may be left in body, absorbable • Allows for normal healing • No evidence of adhesion, infection, immunogenicity

Safe  

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Solution: AC5 Surgical HemostatTM

Synthetic peptide Clear liquid, squirted or sprayed

Physical mechanical barrier

Bleeding stops promptly Blood thinner agnostic

Can see and operate through it

Bioasborbable

Enables normal healing

Arch  Therapeu,cs,  Inc.  ©  2015  

Arch  Therapeu,cs,  Inc.  ©  2015  

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Liver

Arch  Therapeu,cs,  Inc.  ©  2014  

Arch  Therapeu,cs,  Inc.  ©  2014  

Novel Mechanism: Self-Assembly

Composition Delivered Locally Assembled Into Network

Arch  Therapeu,cs,  Inc.    ©  2014  

Arch  Therapeu,cs,  Inc.  ©  2015  Cormier  et  al,  ACSNano,      2013  

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0%  

100%  

200%  

300%  

400%  

500%  

600%  

Unmedicated  Control  

Unmedicated                                AC5  

Heparin                                                Control  

Heparin                                              AC5  

Heparin  

0%  

100%  

200%  

300%  

400%  

500%  

600%  

Unmedicated  Control  

Unmedicated                      AC5  

Ticagrelor                              Control  

Ticagrelor                                        AC5  

Ticagrelor    

0%  

100%  

200%  

300%  

400%  

500%  

600%  

Unmedicated  Control  

Unmedicated                            AC5  

Plavix                                              Control  

Plavix                                                      AC5  

Plavix  

0%  

100%  

200%  

300%  

400%  

500%  

600%  

Unmedicated  Control  

Unmedicated                        AC5  

ASA                                                  Control  

ASA                                                            AC5  

Aspirin  (ASA)  

0%  

100%  

200%  

300%  

400%  

500%  

600%  

Unmedicated  Control  

Unmedicated                      AC5  

ASA/Plavix                            Control  

ASA/Plavix                                    AC5  

Aspirin  +  Plavix  

AC5 Stops Bleeding in Presence of Anticoagulants Rat Liver Bleeding Model (4 mm Diameter Penetrating Full Thickness Wound)

Time to Hemostasis Difference With Reference to Unmedicated Control

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Bleeding in Anticoagulated Patients Is Challenging

"There are an increasing number of patients on long-term therapy with antiplatelet agents and other anticoagulants. We are often required to perform procedures and operations on patients with active antiplatelet and anticoagulation therapy. Hemostasis for bleeding control in these patients is extraordinarily challenging. None of the hemostatic agents available today have demonstrated enhanced efficacy in the setting of antiplatelet therapy. The results described in this study are extremely promising because we surgeons need improved hemostatic control in the setting of antiplatelet therapy, which many of our patients are required to stay on for its cardioprotective effects.” Dr. Paresh Shah, Director General Surgery and Vice Chair of Surgery at NYU Langone Medical Center

"There is a great need to continue to develop novel hemostatic agents and sealants that are efficacious in surgical and trauma patients. In particular, the need is greatest in those patients whose underlying coagulation cascade or platelet status is abnormal, whether due to concurrent antithrombotic therapy or an underlying disease. Increasing numbers of patients are on anticoagulant or antiplatelet medications. This can present a challenge to surgeons and other interventionalists when procedures are needed on these patients. These initial findings on the activity of AC5 in this setting are very encouraging and may lead to significant benefit in the future.” Steven Schwaitzberg, MD, Professor of Surgery at Harvard Medical School; advisor to Arch Therapeutics

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Clinical Regulatory

Expected regulatory path: medical device

CE Mark EU (first focus)

PMA USA

Non-US clinical trial

AC5 Surgical HemostatTM for hemostasis

Likely primary endpoint: time to hemostasis

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Market Size US: ~15% of ~26M diabetes patients develop foot ulcers US: ~2.5M pressure ulcers in US Global: ~$13B annual wound management revenues

Market Needs

Better treatment options to safely and effectively prevent leakage control bleeding after debridement maintain moist wound environment reduces infection risk enable healing

Pipeline: Barrier for Chronic Cutaneous Ulcers

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Intellectual Property: Broad Portfolio

Licensed from

Massachusetts Institute of Technology

EXCLUSIVE (Arch Is Sole Licensee Worldwide)

Two patent families cover compositions and methods for hemostasis and controlling movement of bodily substances

Expected expiry 2026 – 2028

NON-EXCLUSIVE

5 patent families providing freedom to operate

Expected expiry 2014 – 2026

Arch Therapeutics

Treatment of damaged tight junctions and enhancing extracellular matrix

Compositions for prevention of adhesions and other barrier applications

Additional IP filed

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Board of Directors

Avtar Dhillon, MD Chairman

MDS Capital Corp (Lumira), Protox (Sophiris Bio), BC Advantage Funds, Stevia First, Inovio, Oncosec

Arthur Rosenthal, PhD Director

JNJ, Boston Scientific (past CSO), Labcoat, Capella, Cyberonics, Boston University

Terrence W. Norchi, MD, MBA Director, President, CEO, Founder

NEO Medical Univ., MIT, Tufts School of Med., Sanford Bernstein, Citigroup, Putnam

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Leadership Team

William M. Cotter Chief Operating Officer

Genetic Systems, Sanofi Diagnostics Pasteur, Closure Medical (JNJ), Helicos, Cohera

Richard E. Davis Chief Financial Officer

NMT  Medical, Rolling Management,  TJX  Companies,  Wang  Laboratories

Chirag Shah, PhD VP of R&D Engineering and Quality

Covidien, Biolink, Bard

Steve Kates, PhD VP of Technology

Brandeis, Millipore, Surface Logix, Ischemix, Northeastern, NIH, Am. Chem. Soc., Am. Peptide Soc.

Elaine Whitmore, PhD VP of Regulatory Affairs

Northwestern Univ., JNJ, Haemacure, Scivance

Terrence W. Norchi, MD, MBA Director, President, CEO, Founder

NEO Medical Univ., MIT, Tufts School of Med., Sanford Bernstein, Citigroup, Putnam

Advisors and Consultants include highly regarded scientists and physicians

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Milestones Planned for 2015

Data Obtain and disclose safety and performance data Team Commence collaboration with CÚRAM (Ireland) Regulatory Confirm CE Mark pathway plan Clinical Initiate human clinical trial Finance Secure capital including SFI grant for CÚRAM - Arch collaboration Sales/Mkt Develop appropriate commercialization strategy / partnership Pipeline Advance Chronic Cutaneous Ulcer and other Programs IP Advance intellectual property portfolio

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Contact Information 235 Walnut Street, Suite 6 Framingham, MA 01702 USA

Investor Relations Tel: 1.855.340.ARTH (2784) investors@archtherapeutics.com