Slide 1: Presentation to Institutional Shareholder Services
© NeoPharm Presentation to Institutional Shareholder Services September 30, 2004
Slide 2: Safe Harbor Statement
Safe Harbor Statement e Various remarks that we may make about future expectations, plans and prospects for the Company constitute forward-looking statements for purposes of the Safe-Harbor provisions under The Private Securities Litigation Reform Act of 1995. Actual results may differ materially fr
Slide 3: Corporate Data
Corporate Data . Q/ e Shares Outstanding: 23.3 M e Average Volume: 260K e Recent Price (9/28/04): $8.28 e Market Capitalization: $187M ¢ Float: 5.4M ° 52-Week High/Low $22.70 - $4.66
Slide 4: Current Strategy a Success
Current Strategy a Success ° Reduce Burn Rate = 2004 estimated $55-58 million = 2005 targeted $43-47 million e Precise Trial patient enrollment on track e Evaluating current portfolio for out licensing and partnering opportunities
Slide 5: IL13-PE38QQR
IL13-PE38QQR e New treatment for glioblastoma multiforme (GBM) brain cancer e Currently enrolling patients in pivotal Phase III Precise trial e FDA Recognition = Orphan drug designation (U.S. & Europe) = Fast track development designation = Special protocol assessment agreement = CMA Pilot 2 program
Slide 6: Other Promising Products
Other Promising Products e LEP-ETU e LE-SN38 e NeoPhectin
Slide 7: Upcoming Milestones/ Targets
Upcoming Milestones/ Targets ° Q4/04 = Reduce cash burn rate 100-125 patients enrolled in IL13-PE38QQR Precise Trial by quarter end Begin LEP(ETU) Bioequivalence study for 505(b)2 filing Prioritize pipeline Continue out licensing discussions
Slide 8: Planning for the Future
Planning for the Future e Valuing portfolio with a goal of out licensing, partnering or terminating specific programs = Recognize value instead of simply abandoning potentially valuable assets e Continued cost reductions without sacrificing trial design = Ensure successful FDA approval process inste
Slide 9: Ongoing Milestones/ Targets
Ongoing Milestones/ Targets = Cash burn rate approximately $43-47 million = Complete Precise Trial enrollment = Out license or partner appropriate candidates
Slide 10: Positive Opportunities
Positive Opportunities e Conserving Cash: Good into 34 Quarter 2006 = Moved out from 3 Quarter 2005 as estimated in April 2004 e Robust Pipeline e Out licensing/ Partnering Opportunities e Precise Trial on track for Q3/05 enrollment completion
Slide 11: Recent Stock Performance
Recent Stock Performance ‘57.8% decline in NeoPharm stack price between recent 6-morth high ant 6 John Kapoor's removal as Chaim an ‘Bigcharts.com
Slide 12: Board of Directors Opposes Kapoor Solicitation
Board of Directors Opposes Kapoor Solicitation e Cost Targets Not Reasonable = $30 million burn rate unattainable ¢ Requires jettisoning all other products ¢ Jeopardizes timing for completion of IL13 trial ¢ Retaliation For Removal as Chairman e Questionable Governance Implications
Slide 13: Kapoor's Numbers vs. Board's Plan
Kapoor’s Numbers vs. Board’s Plan e Company’s plan: = Developed by experienced management team = Qutside consultant input = Thorough process involving board review e Kapoor’s numbers: = Unrealistic targets and no strategy = Not presented to the Board for review = Not attainable in the estimate of ma
Slide 14: Concerns with Kapoor
Concerns with Kapoor e Management Disruption = Past history of alienating staff = Lack of management support for “plan” e Related Party Transactions = Akorn = Other controlled companies
Slide 15: Other Concerns with Kapoor
Other Concerns with Kapoor e Alignment of Interests e Control Premium ° Contradictions = Criticizing actions he approved = Criticizing Board he nominated and was prepared to vote for = Criticizing decline in stock price that occurred while he was Chairman
Slide 16: Other Concerns with Kapoor
Other Concerns with Kapoor e Timing Concerns e Past History e Long-Term Disruption = No intent to drop solicitation
Slide 17: Searchable
Searchable text section of graphics shown above [ LOG O] Presentation to Institutional Shareholder Services September 30, 2004 Saf e Harbor Statement • Various remarks that we may make about future expectations, plans and prospects for the Company constitute forward-looking statements for purposes o