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MorphoSys and Heptares Sign Alliance to Develop Antibody Therapeutics Targeting GPCRs

February 13, 2013

MARTINSRIED and MUNICH, Germany, WELWYN GARDEN CITY, England and BOSTON, February 13, 2013 /PRNewswire/ –

Collaboration Harnesses Heptares’ StaRs(R) to Open up New Target Space for

Therapeutic Antibodies from MorphoSys’ Ylanthia(R) Platform

MorphoSys AG (FSE: MOR; Prime Standard Segment, TecDAX) and UK-based Heptares
Therapeutics, the leading GPCR drug discovery and development company, have signed an
agreement to discover novel antibody therapeutics targeting G protein-coupled receptors
(GPCRs), which are membrane proteins involved in a broad range of biological processes and
diseases.

“GPCRs comprise the single largest class of targets for pharmaceuticals currently on
the market. Technical challenges have meant that GPCRs have been largely intractable to
therapeutic antibody development. We believe that by combining Heptares’ unique StaR(R)
platform for generating stable GPCRs as antigens with our antibody discovery technology,
we will be able to unlock the immense potential of therapeutic antibodies against GPCRs,”
commented Dr. Simon Moroney, Chief Executive Officer of MorphoSys AG.

“By creating StaRs, we believe we have overcome a major challenge facing small
molecule and biologics discovery efforts focused on GPCRs. This has enabled us to create
partnerships with leading pharma and biotech companies in both areas as well as to advance
our own pipeline. We are therefore very excited to sign this new partnership with
MorphoSys, one of the world’s most advanced antibody therapeutic companies, to further
leverage the power of our StaR(R) technology into the antibody space,” said Malcolm Weir,
Chief Executive Officer of Heptares.

Under the terms of the agreement, Heptares will generate stabilized receptors (StaRs)
for a set of GPCR disease targets proposed by MorphoSys. MorphoSys will then apply its
Ylanthia antibody library to discover and develop antibody therapeutics against these
StaRs. MorphoSys has the right to sublicense to third parties access to these targets in
conjunction with therapeutic antibody candidates. Heptares will receive upfront and
research funding payments, plus a share of future sublicensing revenues generated by
MorphoSys. Heptares also chose Ylanthia to develop and commercialize one therapeutic
antibody created by MorphoSys against a GPCR target selected by Heptares. In this case,
MorphoSys is eligible to receive license fees, milestones and royalties on any Ylanthia
antibody developed by Heptares.

Heptares’ StaRs offer a breakthrough solution to the main challenge associated with
making antibodies against GPCRs, namely producing purified and properly folded protein for
use as an antigen against which antibodies are raised. StaRs enable antibody discovery by
stabilizing the GPCR protein outside the cellular membrane in the correct conformation.
StaRs preserve biologically relevant epitopes thereby enabling generation of a diverse
panel of functional antibodies. This has previously proved very difficult for GPCRs, which
lose their conformational and functional integrity when removed from their natural
environment in cell membranes.

MorphoSys’s Ylanthia antibody library comprises more than 100 billion distinct, fully
human antibodies, which makes it the industry’s largest known antibody Fab library.
Ylanthia’s genetic composition translates into unprecedented structural diversity of the
antibodies and offers optimized developability features. The library’s diversity is
expected to result in antibodies against previously inaccessible target molecules and to
provide unique epitope coverage.

The GPCR superfamily is the largest and single most important family of drug targets
in the human body. It plays a central role in many biological processes and is linked to a
wide range of disease areas. GPCRs are expressed in every type of cell in the body where
their function is to transmit signals from outside the cell across the membrane to
signaling pathways within the cell, between cells and between organ systems. There are
over 375 non-chemosensory GPCRs encoded in the human genome, of which 225 have known
ligands and 150 are orphan targets. GPCRs are the site of action of 25-30% of currently
approved drugs. Six of the top ten and 60 of the top 200 best-selling drugs in the US in
2010 target GPCRs. Seven of 37 drugs approved in 2012 by the US Food & Drug Administration
target GPCRs. By the end of 2012, 37 therapeutic antibodies had been approved and are
being marketed in countries around the world. However, to date only one GPCR-targeting
antibody has been approved.

About MorphoSys:

MorphoSys developed HuCAL, the most successful antibody library technology in the
pharmaceutical industry. By successfully applying this and other patented technologies,
MorphoSys has become a leader in the field of therapeutic antibodies, one of the
fastest-growing drug classes in human healthcare.

Together with its pharmaceutical partners, MorphoSys has built a therapeutic pipeline
[http://www.morphosys.com/pipeline ] of more than 70 human antibody drug candidates for
the treatment of cancer, rheumatoid arthritis, and Alzheimer’s disease, to name just a
few. With its ongoing commitment to new antibody technology and drug development,
MorphoSys is focused on making the healthcare products of tomorrow. MorphoSys is listed on
the Frankfurt Stock Exchange under the symbol MOR. For regular updates about MorphoSys,
visit http://www.morphosys.com.

About Heptares Therapeutics:

Heptares creates new medicines targeting clinically important, yet historically
challenging, GPCRs (G protein-coupled receptors), a superfamily of drug receptors linked
to a wide range of human diseases. Leveraging our advanced structure-based drug design
technology platform, we have built an exciting discovery and development pipeline of novel
drug candidates, which have the potential to transform the treatment of serious diseases,
including Alzheimer’s disease, Parkinson’s disease, schizophrenia, migraine and diabetes.
Our pharmaceutical partners include Shire, AstraZeneca, MedImmune, Takeda, Cubist and
MorphoSys, and we are backed by MVM Life Science Partners, Clarus Ventures, Novartis
Venture Fund and Takeda Ventures. To learn more about Heptares, please visit

http://www.heptares.com.

HuCAL(R), HuCAL GOLD(R), HuCAL PLATINUM(R), CysDisplay(R), RapMAT(R), arYla(R),
Ylanthia(R) and 100 billion high potentials(R) are registered trademarks of MorphoSys AG.

Slonomics(R) is a registered trademark of Sloning BioTechnology GmbH, a subsidiary of
MorphoSys AG.

StaRs(R) is a registered trademark of Heptares Therapeutics

This communication contains certain forward-looking statements concerning the
MorphoSys group of companies. The forward-looking statements contained herein represent
the judgment of MorphoSys as of the date of this release and involve risks and
uncertainties. Should actual conditions differ from the Company’s assumptions, actual
results and actions may differ from those anticipated. MorphoSys does not intend to update
any of these forward-looking statements as far as the wording of the relevant press
release is concerned.

        For more information, please contact:

        MorphoSys AG
        Dr. Claudia Gutjahr-Loser
        Head of Corporate Communications & IR
        Tel: +49(0)89-899-27-122

        Mario Brkulj
        Associate Director Corporate Communications & IR
        Tel: +49(0)89-899-27-454

        Alexandra Goller
        Specialist Corporate Communications & IR
        Tel: +49(0)89-899-27-332

        investors@morphosys.com

        Heptares Therapeutics Ltd
        Mark Swallow, Chris Gardner (Citigate Dewe Rogerson)
        Tel: +44(0)20-7282-2948
        mark.swallow@citigatedr.co.uk

        Malcolm Weir
        Chief Executive Officer
        Tel: +44(0)1707-358-629
        malcolm.weir@heptares.com

        Dan Grau
        President (USA)
        Tel: +1-857-222-4586
        dan.grau@heptares.com

SOURCE Heptares Therapeutics


Source: PR Newswire