CSRC Presentation.Napa.2015

1 6/1/15 1 1 June 2, 2015 NASDAQ: DSCO surfactant : Where We Have and Where We Are Going 2 DISCLOSURE : Christina Joseph, BS, RRT-NPS Clinical R&D Specialist Discovery Labs Discovery Labs is a manufacturer of KL4 and holds patents for Aerosurf technology r 3 Opinions expressed in these slides represent the speaker s own opinions, and not those of speaker s employer or any other organization 6/1/15 2 4 Pulmonary Surfactants and Respiratory Distress Syndrome (RDS) 5 1. Griese M. Pulmonary surfactant in health and human lung diseases: state of the art. Eur. Respir. J. 1999;13(6):1455 1476. 2. American Lung Association. State of Lung Disease in Diverse Communities (2010). Available at Accessed August 29, 2012 Neonatal Respiratory Distress Syndrome (RDS) Epidemiology Life-threatening in premature infants, whose lungs have not fully developed surfactant prevents alveolar collapse at low lung volume, and preserves bronchiolar patency during normal and forced respiration1 Most cases occur in babies born before 28 weeks Rare in infants born at full-term 16,268 infants suffered from RDS in 20052 An incidence rate of per 1000 In 2007, 735 deaths, or 17 per 100,000 live births, were due to RDS2 6 Introduction to RDS RDS is a lung disorder of prematurity caused by a deficiency in the production and secretion of surfactant .

2 Hyaline membrane disease Strikes about 40,000 babies, 20% neonatal deaths Typically occurs within the first few hours of life, usually first 48 96 hrs of life. Clinical signs include: Tachypnea Retraction Grunting Nasal flaring Cyanosis 6/1/15 3 7 Disorders Associated with surfactant Dysfunction Several other disease processes are associated with abnormalities in surfactant production and/or secretion: Meconium aspiration syndrome (MAS) Bronchiolitis Asthma Pneumonia Acute RDS / Acute Lung Injury (ALI) COPD 8 RDS: Risk Factors Prematurity Low birth weight (50% of VLBW 500-1500gr) Male gender White race Delivery by c-section Asphyxia at birth Maternal diabetes Multiple births ( twins) Family history Chorioamnionitis 9 RDS: Clinical Manifestation and Course Adapted from Greenough and Milner, 2003 6/1/15 4 10 RDS.

3 Complications and sequelae Many infants with RDS begin to recover from the disease within 48-72 hrs Most infants with transient RDS recover in 7-10 days Complications result from prematurity or effects of RDS MV Bronchopulmonary dysplasia (BPD/CLD) Pneumothoraces Atelectasis Patent ductus arteriosus (PDA) Pulmonary hemorrhage IVH/PVL 11 Chest x-ray 12 12 Perez-Gil J. Biochimica et Biophysica Acta. 2008;1778:1676-1695. Critical Role of Pulmonary Surfactants in Newborns Developmental insufficiency of surfactant production is associated with severe respiratory dysfunction The first breath of an infant is dependent upon surfactant The formation of surfactant is incomplete in premature infants Infants delivered prematurely are at risk of developing RDS 6/1/15 5 13 surfactant is produced at about 20 weeks of gestation It is secreted into the alveolar fluid at 28-32 weeks of gestation Reaches mature levels after 35 weeks of gestation surfactant Composition and Metabolism 14 surfactant Composition and Metabolism surfactant is a macro-aggregate of highly organized lipids (~90%) and surfactant -specific proteins (~10%)

4 , The lipid and protein components of surfactant are preserved across species The major components that confer the unique ability of surfactant to lower surface tension are: saturated phosphatidylcholine species surfactant protein B (SP-B) surfactant protein C (SP-C) surfactant is synthesized in type II cells, stored in lamellar bodies, and secreted into the alveoli, where it forms a surface film 15 The Chemical Composition of Pulmonary Surfactants Pryhuber GS. Mol Genet Metab. 1998;64:212-28 6/1/15 6 16 Chemical Composition of Pulmonary surfactant Mammalian-cell surfactants contain protein-phospholipid complexes 90% phospholipids Dipalmitoylphosphatidylcholine (DPPC) primarily 10% protein SP-A-Hydrophilic SP-B-Hydrophobic SP-C-Hydrophobic SP-D-Hydrophilic Pryhuber.

5 Mol Genet Metab. 1998;64:217-228. 17 Primary surfactant Proteins SP-A: Enhances lipid re-uptake and inhibits secretion1 Reduces surface tension at air-liquid interface2 Plays an important role in immune and inflammatory regulation within the lung3,4 Lack of SP-A does not affect survival in mice5 Notter, 2000, Ballard and Venkatesh, 1994 18 Primary surfactant Proteins SP-B: Facilitates absorption of phospholipids1 Enhances the surface-tension properties of surfactant phospholipids2 Lack of SP-B is fatal in humans, whereas lack of SP-C is not3 Pryhuber, 1998 6/1/15 7 19 Primary surfactant Proteins SP-C: Facilitates absorption and spreading of phospholipids1 SP-D: Plays a role in pulmonary immune and inflammatory response1-3 SP-D deficient mice have an accumulation of surfactant lipids (SP-A and SP-B) in alveoli, but this does not affect survival4 Ballard and Venkatesh, 1994 Botas et al 1998 20 Summary SP-B greatly enhances surface-tension lowering effects of surfactant1 Supplementation of SP-B and SP-C in an animal-derived surfactant improved in vivo function2 Lack of SP-B is fatal in humans3 and knockout mice4 Lack of SP-A,5 SP-C,6 or SP-D7 is not fatal in knockout mice A synthetic surfactant containing human SP-B is the next generation of surfactant therapy Pryhuber, 1998 Nogee 1993, Tokieda 1997, Glasser 2001 21 Mechanism of Action Endogenous (produced by the body)

6 Pulmonary surfactant lowers surface tension at the air-liquid interface of the alveolar surfaces during respiration Endogenous surfactant acts by adhering to the alveolar surface and displacing water molecules, thereby stabilizing the alveoli against collapse A deficiency of pulmonary surfactant in premature infants results in RDS 6/1/15 8 22 23 Milestones in the Care of Neonates with RDS Successful clinical trials with commercial animal-derived and synthetic non-protein containing surfactants Introduction of neonatal ventilators 1964 1967 Treatment with only lipid components of surfactants fails Avery and Mead describe surfactant deficiency as a cause of RDS 1960s 1959 1990s FDA approval of first peptide-containing synthetic surfactant 2012 24 The Evolution of Surfactants in the United States 1990 1990 Exosurf Synthetic.

7 Non-Protein Containing surfactant 1991 Survanta 1998 Infasurf 1999 Curosurf 2012 SURFAXIN 2012 Animal-Derived Surfactants Synthetic Peptide- Containing surfactant 6/1/15 9 25 The Evolution of surfactant Replacement Therapies Generation Product Source Comments Generation 1 Synthetic w/o protein Exosurf (colfosceril) DPPC - no protein mimics No longer marketed in the US and EU Generation 2 Animal-derived, protein-containing Curosurf (poractant alfa) Porcine extract Available in the US Survanta (beractant) Bovine extract Available in the US Infasurf (calfactant) Bovine extract Available in the US Limited use outside the US Generation 3 Synthetic, protein-containing SURFAXIN (lucinactant) DPPC POPG palmitic acid KL4 peptide (SP-B mimic) Approved by US FDA First peptide-containing synthetic surfactant Demonstrated mortality and morbidity benefits in phase 3 trials 26 The A major breakthrough in synthetic- surfactant technology occurred when the synthetic peptide KL4 was developed by Dr.

8 Charles Cochrane and colleagues at The Scripps Research Institute, La Jolla, California Cochrane CG, et al. Science. 1991;254:566-68. 27 The Development of Sinapultide (KL4) Dr. Cochrane et al. recognized that SP-B has large regions of hydrophobic residues with intermittent hydrophilic residues Peptides prepared from various regions of the SP-B sequence were combined with phospholipids, and it was determined: The full SP-B sequence was not required to increase the surface activity of phospholipids It was critical to have the same pattern of hydrophobic and hydrophilic amino acid residues These findings led to the derivations of the amino acid sequence in the KL4 peptide used today in SURFAXIN Cochrane CG, et al. Science. 1991;254:566-68. 6/1/15 10 28 Characteristics of Animal-Derived Surfactants Potential transfer of undesirable and potentially immunogenic foreign proteins to the infant1 Minimal resistance to inactivation by oxidants or plasma protiens1,2 Personal, cultural or religious objections to products of animal origin3 Variability in lot-to-lot protein content1,3 Disadvantages related to the manufacturing process, such as limited sourcing, inter-batch inconsistency, and unpredictable potency3 1.

9 Sinha S, et al. Curr Opin Pediatr. 2007;19:150-4. 2. Andersson S, et al. Lung. 1999;177:179-89. 3. Sarkar S, et al. J Neonatal Perinatal Med. 2011;4:235-39. 29 Rationale for a Synthetic surfactant Limitations of animal-derived surfactants:1 Sensitivity to personal, cultural or religious objections to products of animal origin2 Reduction of BPD/CLD with synthetics3 less resistant to plasma proteins and free radicals1,4 Variability in lot-to-lot protein content1 May contain undesirable and potentially immunogenic foreign proteins1 1. Sinha S, et al. Curr Opin Pediatr. 2007;19:150-4. 2. Sarkar S, et al. J Neonatal Perinatal Med. 2011;4:235-39. 3. Moya FR, et al. Pediatrics. 2005;115:1018-29. 4. Andersson S, et al. Lung. 1999;177:179-89. 30 Summary of Key Points A milestone in the treatment of RDS was surfactant -replacement therapy, which has continued to evolve Early surfactants were synthetic, and contained no proteins Animal-derived surfactants contained proteins, but posed a new set of challenges SURFAXIN is the first synthetic.

10 Peptide-containing surfactant 6/1/15 11 31 surfactant Comparison Trade Name Survanta Curosurf Infasurf Surfaxin Generic Beractant Poractant Alfa Calfactant Lucinactant Source Bovine Porcine Bovine Synthetic Indication Prevention and Treatment of RDS Treatment of RDS Prevention and treatment Prevention of RDS Phospholipid content 25mg/ml 76mg/ml 35mg/ml 30mg/ml Dosage 100mg/4ml/kg 200 105mg/3ml/kg 175 Interval Not <q6 hr q12hr Same q12hr Not <q6hr Dosing 4 aliquots 2 aliquots 2-4 aliquots 4 aliquots 32 Positive Pressure Ventilation Positive pressure ventilation is a key important factor while administering surfactant . Essential for lung recruitment FRC 33 surfactant administration with Bodai 6/1/15 12 34 surfactant administration with Ballard Catheter 35 (INtubation- surfactant -Extubation) InsurE The INSURE, or Intubation alongside the application of surfactant and then Extubation, followed by nCPAP is a very effective and useful method that reduces the need for MV, decreases side effects, shortens the hospitalization time, and eliminates extra hospital expenses Verder and colleagues showed that inducing one dose of surfactant through the nasal airway with CPAP reduces the later need for MV in neonates with RDS.