BioSpecifics Technologies Corp. is a biopharmaceutical company that has developed injectable collagenase for twelve clinical indications. The company is partnered with Auxilium Pharmaceuticals, Inc. for injectable collagenase (XIAFLEX®). XIAFLEX is approved in the U.S. for the treatment of Dupuytren’s contracture in adults with a palpable cord in the palm. Auxilium is also developing XIAFLEX for the treatment of Peyronie's disease, which is currently in Phase 3 pivotal clinical trials, as well as for Frozen Shoulder (Adhesive Capsulitis) and cellulite.

Thomas L. Wegman, President

Mr. Wegman has served as an officer at BioSpecifics for more than 20 years and has been a member of the Board of Directors since 1994. Prior to his appointment as President on October 17, 2005, he served as the Executive Vice President of the Company. He has over 30 years of experience in the biopharmaceutical industry managing company operations, drug development, licensing and registration.

From 1978 to 1983, Mr. Wegman managed the production, marketing and foreign registration activities related to an avian vaccine business, Biota NV. Mr. Wegman has been instrumental in licensing technologies from universities for use by BioSpecifics. He is the author of a number of U.S. and foreign patents in the field of life sciences. Mr. Wegman received his B.A. from Boston University.

Collagenase is an enzyme that breaks down collagen and is the only protease that can hydrolyze the triple helical region of collagen under physiological conditions. The specific substrate collagen comprises approximately one-third of the total protein in mammalian organisms, and it is the main constituent of skin, tendon and cartilage, as well as the organic component of teeth and bone. The body relies on endogenous collagenase production to remove dead tissue, and collagenase production is an essential biological mechanism that regulates matrix remodeling and the normal turnover of tissue. The Clostridial collagenase produced by BioSpecifics has a broad specificity towards all types of collagen and is acknowledged as much more efficient than mammalian collagenases. Clostridial collagenase cleaves the collagen molecule at multiple sites along the triple helix, whereas the mammalian collagenase is only able to cleave the molecule at a single site along the triple helix. Because collagenase does not damage the cell membrane, it is widely used for cell dispersion for tissue disassociation and cell culture.

Histological and biochemical studies have shown that the tissue responsible for the deformities associated with Dupuytren's contracture and Peyronie's Disease is primarily composed of collagen. Treatment with injectable collagenase for removal of excessive scar tissue represents a first-in-class non-invasive approach to this unmet medical need.

BioSpecifics has developed a proprietary process to produce a purified collagenase product that is fully characterized and has shown stability over the course of many years.

• Dupuytren's contracture
• Peyronie's Disease
• Frozen shoulder
• Removal of adipose tissue
• Others

In particular, the use of XIAFLEX® for the treatment of Peyronie's Disease and Dupuytren's contracture has the following intellectual property protection:

• Orphan Drug designation status in U.S. granting seven years of market exclusivity post-approval

• U.S. use patents for collagenase for Dupuytren's contracture and Peyronie's Disease
• Certain foreign patents also cover these products in those countries
• BioSpecifics is entitled to royalties based on pending and issued patents through 2028

BioSpecifics is partnered with Auxilium Pharmaceuticals, Inc. for injectable collagenase (XIAFLEX®). To date, the Company has received $21M million in payments. BioSpecifics is eligible for future low double digit royalties as percentage of worldwide net sales by Auxilium, Asahi Kasei or Pfizer. These royalty payments are independent of clinical indication, territory and sales volume. The Company is also eligible for additional mark-up on COGS as well as future modest milestones for additional indications, regulatory submissions and approvals in the United States or major countries in Europe.

Auxilium Pharmaceuticals is partnered with Pfizer, Inc. for the development, commercialization and supply of XIAPEX® for Dupuytren's contracture and Peyronie's disease in 27 member countries of the European Union and 19 other European and Eurasian countries. BioSpecifics is entitled to receive 8.5% of all remaining future milestone payments that may be made by Pfizer to Auxilium, in addition to those due to it from its partnership with Auxilium.

Auxilium is also partnered with Asahi Kasei Pharma Corporation  for the development, commercialization and supply of XIAFLEX for the treatment of Dupuytren's contracture and Peyronie's disease in Japan. BioSpecifics is entilted to a certain percentage of the $247 million in potential future milestone payments made to Auxilium, with $37 million tied to development and regulatory milestones and $210 million based on sales milestones as well as . In addition, BioSpecifics will receive a different percentage depending upon the indication of all additional sublicense income Auxilium receives from Asahi, a markup on the cost of goods sold and low double digit royalties as a percent of net sales independent of clinical indication and sales volume in Japan.