North American Neuromodulation Society Meeting 2012

1. Harnessing the Inflammatory Reflex: Using Neuromodulation as a Novel Approach to Treat Chronic Inflammatory Diseases R Zitnik, Y Levine, M Faltys, T Arnold SetPoint Medical Corporation, Valencia, California 12/7/12 North American Neuromodulation Society Meeting 2012 1

2. Common disorders- up to 2% of population Affects young and middle aged adults Severe, “life-impacting” symptoms Systemic inflammation associated with highly elevated cardiovascular mortality risk Inflammatory Bowel Disease: Crohn’s and Ulcerative Colitis Rheumatoid Arthritis Inflammatory Disorders Have Significant Morbidity and Mortality- Medical Need Remains High Psoriasis, Ankylosing Spondylitis, Psoriatic Arthritis, Lupus 12/7/12 North American Neuromodulation Society Meeting 2012 2

3. Lack of efficacy in 1/3 (RA) to 2/3 (Crohn’s) Rare but serious safety issues: Infection, TB, CHF, cancer risk, MS, PML, hypercholesterolemia $30 billion in annual sales with per patient cost of $25-35K/year Current Drugs and Biologics are an Important Advance- Yet Have Major Drawbacks Goal is to improve the treatment of these diseases using neuromodulation 12/7/12 North American Neuromodulation Society Meeting 2012 3

4. CNS Regulates the Immune System via the “Inflammatory Reflex” • Afferent vagus and CNS sense inflammatory mediators (should this read: CNS senses inflammation via the afferent vagus) • Efferent vagus signals resident T cells and macrophages in the spleen and GI tract • Pro-inflammatory cytokine production reduced • Circulating immune cells traversing the spleen are altered: • Reduced capacity to express inflammatory mediators and adhesion molecules as cells move into diseased tissue • In inflammatory diseases, activity of pathway is decreased Tracey, Cell 2012 Rosas-Ballina, Science 2011 12/7/12 North American Neuromodulation Society Meeting 2012 4

5. Stimulating this Reflex Using Neuromodulation will Reduce Inflammation and Improve Clinical Disease Rheumatoid Arthritis Inflammatory Bowel Disease Andersson U, Tracey K. Ann Rev Immunol 2012; 30:313 12/7/12 North American Neuromodulation Society Meeting 2012 5

6. VNS Lead for Rodent Inflammation Models 12/7/12 North American Neuromodulation Society Meeting 2012 6

7. Joint Swelling Was Reduced in Standard Collagen-Induced Arthritis Model • Bolder BioPATH, Inc. • n=4/Normal Controls • n=12/disease control • n=9/ stimulation group • *p≤0.05 t-test to Disease Controls 12/7/12 North American Neuromodulation Society Meeting 2012 7

8. Importantly, Structural Damage to the Joint was Also Reduced • Bolder BioPATH, Inc. • n=12/disease control • n=9/ stimulation group • *p≤0.05 t-test to Disease Controls * * * * 12/7/12 North American Neuromodulation Society Meeting 2012 8

9. “Methotrexate Failure” Population Active RA despite treatment with first line agent methotrexate Patients would otherwise have been candidates for a TNF antagonist Standard RA clinical endpoints: DAS28 (Tender and Swollen Joint score, CRP, Patient VAS) ACR 20/50/70 Response Rate EULAR Response and Remission Rate Commercially purchased VNS devices were used for the study Clinical Study of Neuromodulation in Rheumatoid Arthritis 12/7/12 North American Neuromodulation Society Meeting 2012 9

10. Individual Patient DAS Scores Show Rapid and Marked Improvement in 6 of the 8 Subjects EULAR Remission 12/7/12 North American Neuromodulation Society Meeting 2012 10

11. Clinical Response Rates are Comparable to Those Seen with Biologics 12/7/12 12/7/12 North American Neuromodulation Society Meeting 2012 11 11

12. Future Studies Will Utilize SetPoint’s Proprietary Neuromodulation Platform Surgical Implant MicroRegulator Pod Patient Charger Prescription Pad 12/7/12 North American Neuromodulation Society Meeting 2012 12

13. Inflammatory diseases are a $30B market with significant unmet need Using neuromodulation to drive the inflammatory reflex has a sound biological foundation: Use in clinic is supported by strong preclinical evidence This is the first demonstration that an implantable neuromodulation device improves clinical manifestations of RA: Significant and clinically meaningful improvement in signs and symptoms Response rates were comparable to those with current biologic agents Further larger controlled studies in RA and other chronic inflammatory diseases are warranted. Our microregulator offers significant advantages over current vagal nerve stimulation devices Summary and Conclusions • SetPoint intends to offer a novel therapy that will significantly increases patient QOL, while bending per-patient cost curves down by more than 60% 12/7/12 North American Neuromodulation Society Meeting 2012 13