The MODDERN Cures Solution updates the regulatory system by removing barriers to invention and providing greater predictability in the search for answers to our nation’s unmet medical needs. It’s in everyone’s interest to push for a MODDERN regulatory system that encourages scientific inquiry, rewards ingenuity, and safely speeds modern miracles into everyday diagnostics and treatments that improve patient outcomes.

1. MODDERN Cures Solution Modernizing Our Drug and Diagnostics Evaluation and Regulatory Networks Marc Boutin Executive Vice President & COO National Health Council May 2011

2. The mission of the National Health Council is to provide a united voice for people with chronic diseases and disabilities. © National Health Council

3. Despite many medical breakthroughs, significant unmet need remains for millions of people suffering from chronic conditions. © National Health Council

4. © National Health Council ALZHEIMER’S DISEASE CASE STUDY 100 + YEARS CLINICAL TRIALS 1990s Testing of early drugs to treat symptoms 1990s-Present Tests of diagnostics to identify plaque in brain TRANSLATIONAL RESEARCH 1976-Early ‘90s R&D of first drugs for symptoms 1976-Present Search for drugs to treat or prevent disease 1980s-2001 Research Dx test to detect amyloid BASIC RESEARCH 1906 First Identified 1976 High prevalence acknowledged FDA EVALUATION/APPROVAL 1990s-Present Total of 4 drugs approved to treat symptoms Still waiting for diagnostic tools to accurately identify patients and treatments to prevent, slow, or arrest disease.

5. © National Health Council ALS CASE STUDY 140 + YEARS CLINICAL TRIALS 1993 Trials on Riluzole begin 2009 FDA approval of SOD1 antisense and stem cell trials TRANSLATIONAL RESEARCH 1950s-Present Research conducted to identify treatments 1950s Nerve growth factor identified 1990 Growth factor CNTF found to increase survival of motor neurons BASIC RESEARCH 1869 First identified 1939 Lou Gehrig diagnosed 1993 SOD1 gene mutation found in familial ALS 2000 NINDS issues first RFA for ALS research FDA EVALUATION/ APPROVAL 1996-Present Riluzole approved by the FDA It extends life approximately 3 months in some patients No other approved treatment available Still waiting for a cure, diagnostic tools, and treatments that slow or stop the progression of ALS. Meanwhile, the average patient dies within 2-5 years of diagnosis.

8. BARRIER #1: Drug compounds not developed because of insufficient legal protection © National Health Council

10. Stages of Research and Development © National Health Council Drug Discovery Preclinical Phase Clinical Trials FDA Review 5,000 to 10,000 Compounds  250 Compounds  5 Compounds Clinical Phases I II III  One FDA-Approved Drug 3 to 6 Years 6 to 7 Years 0.5 to 2 Years

11. Lost Opportunities © National Health Council Company Product Description Development stage Disease Abbott ABT-491 Elastase inhibitor Clinical Trials Asthma Novartis Recombinant AT-1 Alpha1-Antitripsin Phase II Emphysema Dupont CMP-777 Proteinase inhibitor Phase I/II CF, Emphysema Cortech/United Ther CE-1037 HNE inhibitor Phase II CF, Emphysema, ARDS Cortech/Ono CE-2000 series HNE inhibitor Pre-clinical CF, Emphysema Dyax EPI-HNE-4 HNE inhibitor Clinical Bronchitis, CF, Emphysema Amgen SLP-1 Recombinant inhibitor Pre-clinical Asthma Biogenidec BG-12 Fumarate derivative Phase III MS

13. © National Health Council

14. BARRIER #2: Lack of alignment between market incentives and personalized medicine © National Health Council

17. BARRIER #3: Delayed access to FDA-approved diagnostic tools © National Health Council

20. BARRIER #4: Outdated reimbursement system for diagnostics © National Health Council

23. Estimated Outlay and Revenue Effects of MODDERN Cures Solution (Outlay Increases are positive number) © National Health Council Provision 5-Year Cost or Revenue Loss 10-Year Cost or Revenue Loss Accelerate the Release of Guidelines – – Improve the Coding and Reimbursement System $5 million $10 million Companion Diagnostics for Existing Drugs/Co-developed Companion Diagnostics negligible $10 million Dormant Therapies – – Total Cost $5 million $20 million

26. Marc Boutin Executive Vice President & COO National Health Council [email_address]