November 2006

A diverse grouping of elementsThe Piper Jaffray biotechnology research team includes 16analysts who bring deep talent and experience from a varietyof backgrounds. Some have extensive equity researchexperience, while others hail from nontraditionalenvironments and contribute unique insight and knowledgeto the team. The team roster includes lab directors from largehealth care companies, physicians, businessconsultants for pharmaceutical companies,scientists, patent attorneys and stock analysts.

Gurpreet Ratra, Ph.D., joined Piper Jaffrayafter serving as a laboratory director atNorthview Pacific Laboratories in California.According to Ratra, the difference in workingwith investment research is that you have theopportunity to meet directly with companyrepresentatives and learn first-hand aboutdrug developments. “Having been in a labenvironment, I can appreciate how long ittakes to bring a drug to market,” saidRatra. “That experience provided mewith a better perspective on whatcompanies experience in working withregulatory and financing issues fromnew drugs.”

Mitul Desai worked as a patentattorney for more than eight yearsbefore joining the Piper Jaffrayteam. His legal knowledge in thespecialty pharmaceuticals sectorhas been instrumental in helpingthe research team learn aboutlegal and political challengesgeneric manufacturers face. “Working in the legal field, thingsmay take weeks and months. On Wall Street,our research is much more real time and has an immediateimpact for our firm’s investing clients,” he said.

Piper Jaffray research analysts Gur Roshwalb, M.D., andSally Bennett, M.D., were physicians earlier in theircareers, but made the switch to stock analysis. Both bringunique perspectives to their work and an appreciation forthe breadth of research being conducted. “As a practicingphysician, I had no idea the amount of research work that washappening across the world and how that research can cause a

paradigm shift,” said Roshwalb.

“As a medical doctor, I prescribed drugs on a dailybasis, but I did not truly comprehend the path ofclinical trial development,” said Bennett. “As an analystit has been fascinating to fully understand andappreciate the long, expensive process of getting a drugfrom the point of first concept to the actual patient.”

“We” versus “me”The Piper Jaffray biotechnology team is based onpartnership and is strengthened by each person’sdiverse background and experience. The result:proprietary and unique research insights forclients. It is this kind of team effort for whichPiper Jaffray is known. The firm has created areputation on Wall Street for producing top-quality integrated research.

“The biotech team at Piper Jaffray is trulya team,” said Caroline Stewart, an eight-year biotechnology research veteran.“We are respectful of each other andpersonify a ‘we’ mentality rather thana ‘me’ mentality.”

Ted Tenthoff, a long-time Wall Streetresearch analyst, agrees. “We have

quality people who come from quiteunique and interesting backgrounds. In

addition, we all have the same goal—work hard andadvance our expertise to provide meaningful ideas andinvestment guidance to clients. We do this in a very ethicaland forthright way. The team is made up of good peoplewho are totally focused.”

Finding the Right ChemistryPatent attorneys, lab directors, physicians, scientists and business consultants combine for newcutting-edge research team.

What do you get when you combine hydrogen and oxygen? Thanks to chemistry, we know you getwater. How about blending professionals with legal backgrounds, medical expertise and businessacumen? With the right chemistry, that mix may result in one of the leading biotechnology researchteams on Wall Street. Take a closer look—at Piper Jaffray.

“The most exciting progress

in medical technology ... is happening

in biotech companies.”

Tracey West, who is a member of the European biotechteam in London, notes that the synergies of the team workwell across international borders. “We are like-minded andambitious people who share a passion for the sector inwhich we work. We all have the same goal of building asuccessful franchise within Piper Jaffray and being theleaders in our sector. This is achieved because we work sowell together.”

“Following the arduous journeys that drugs make from the laboratory to actually helping people continues

to fascinate me.”

According to Ratra, the team is open to sharingexperiences and working in a collaborative environment.The team in fact hosts a monthly call to share ideas andinformation with each other. They also collaborate to hostconference calls for investors with leading doctors andindustry consultants.

Elizabeth Naldi, a former business consultant forpharmaceutical companies, was pleasantly surprised by thediversity across the team. “The variety of backgrounds onthe health care team was pleasantly surprising to me. Ourdiverse experiences allow us to explore new angles andbrainstorm with each other on creative ideas on how toproduce unique and insightful research,” she said.

Passion for Wall StreetThe biotech research team thrives on in-depth analysis andcomplex financial modeling for the most dynamiccompanies in health care today. Each analyst brings apassion for the financial perspective of biotechnology andfinds working in health care research the best of all worlds.

“Working in equity research gives us the ability to apply allfacets of our training, from the years of scientific studies to real-world puzzles of figuring out whether drugs will

work and be successful on the market,” said Thomas Wei, one of the most experienced biotechnology analysts atPiper Jaffray. “I can’t think of another job that wouldprovide a more practical application of all the training wehave received along the way.”

Earlier in her career, Hongbo Lu, Ph.D., worked inscientific roles, including developing strategies for productpipelines, managing R&D groups at a biotechnologycompany and consulting at a variety of health carecompanies. She describes working on Wall Street as themost fascinating job she has had. “Compared to myexperience in scientific research and productcommercialization, nothing is as rewarding or exciting asWall Street where your opinions and actions matter in realtime,” she said.

A career in equity research can be challenging as well.Research analysts are responsible for consuming andbalancing a large amount of information andcommunicating effectively with clients, internal salesprofessionals and company management teams. At the endof the day, the team prides itself on searching outproprietary information that will help clients with theirinvesting strategies.

“I enjoy being able to contact different kinds of people andask them questions to get proprietary information for ourclients,” said Rachel McMinn, Ph.D., a formerpostdoctoral fellow specializing in molecular and cellbiology studies.

Deborah Knobelman, Ph.D., an experienced specialtypharmaceuticals research analyst, added, “Attention todetail and going the extra mile can really make a difference for clients. It truly takes perseverance and anoutgoing personality.”

Inspired by medical advancesThe biotechnology research team prides itself on deliveringproprietary and unique financial analysis, but eachmember also values the advances health care companies aremaking to improve human health. The team cited working

Mitul Desai

NavinJacob

Deborah Knobelman, Ph.D

Thomas Wei

GurRoshwalb,

M.D.

ElizabethNaldi

HongboLu, Ph.D.

Rachel McMinn, Ph.D

Ted Tenthoff

GurpreetRatra, Ph.D.

with some of the world’s brightest scientists and managers,people who are truly designing drugs to help peoplemanage complex diseases.

“Following the arduous journeys that drugs make from the laboratory to actually helping people continues tofascinate me,” said Sam Fazeli, Ph.D., head of the PiperJaffray health care research team in the UK and a 10-yearveteran of biotechnology research. “For every product Iresearch, I continue to learn something new about the longprocess involved in taking a drug from its first hypothesisto a medical treatment that helps thousands of patientsand generates several hundred million dollars. I learn agreat deal in the process—from how to interpret clinicaltrial results to understanding more about the impact health care insurance companies have on the potentialsuccess of products.”

Chad Messer, Ph.D., another former laboratoryprofessional, finds researching biotechnology companiesfascinating because of the opportunity to witness cutting-edge improvements in health care. “Working withbiotechnology companies is much more interesting andfast-paced than working in a lab. The most excitingprogress in medical technology—where there is potential toaffect human life—is happening in biotech companies.”

“The human side of health care research is an important

motivation and very satisfying.”

By guiding investments in this sector, we may be able to saythat we had a tangible role in the development andapproval process for some medicines,” said Wei. “In manyways, our research team has a potential greater impact onhealth care progress than we could have experienced byfollowing a pathway of academic research.”

Fazeli added, “One of the most important issues aroundwhether a drug will succeed in the market is driven by

patient benefit. This is one of the most fundamental facetsof our research. We analyze current standards of care andhow they can be improved by the drug we are researching.”

The state of biotechnology—fast forward 20 yearsAs health-related issues change and drugs become morecomplex, investors will look for even more in-depthanalysis to identify the most promising companiesequipped to deliver tomorrow’s health care miracles.Covering the leading-edge biotechnology companies willonly get more complicated.

Here's a glimpse into what the Piper Jaffray biotechnologyresearch team predicts will be the most challenging issuesfacing health care companies before 2027.

According to Navin Jacob, who has industry experienceworking with pharmaceutical companies such as Pfizer,personalization in medicine will be a dominant topic. “By2020, the era of personalized medicine will have begun.The mapping of the human genome will allow for genetherapy as well as creation of ‘designer drugs’ that aretailored for an individual’s biological characteristics.”

“The mapping of the human genome will allow for gene therapy as well as creation of ‘designer drugs.’”

“As pharmaceutical companies face numerous drug patentexpirations and increased pressure to find billion-dollarutility products, we’ll see large pharmaceutical companiesshift to a biotech model,” said Naldi. They’ll focus moreintently on high-value, smaller patient populations.”

Richard Parkes, Ph.D., an experienced UK biotechnologyresearcher, says risk management is at the forefront ofchange, “The greatest issue facing biotechnologycompanies is risk management. Drug development is a

Caroline Stewart

Sam Fazeli, Ph.D.

Richard Parkes, Ph.D.

Sally Bennett, M.D.

ChadMesser, Ph.D.

TraceyWest

high-risk/high-reward business model. Prudent management ofclinical, regulatory and market risk is essential for a success.”

Piper Jaffray positioned as a biotech research leaderPiper Jaffray analysts have been covering health carecompanies for decades, and the firm is a proven leader indelivering proprietary and unique research to clients. In thepast year and a half, the team has expanded to includecoverage of European companies and welcomed four analystsin London.

“I joined Piper Jaffray in London because I believe the firmhas a sincere focus and commitment to its health carefranchise,” said Bennett. “We have a great biotech team andan excellent reputation. Despite having a global reach, PiperJaffray has been able to maintain the entrepreneurial spiritand dynamism of a much smaller organization.”

Desai added that the firm’s great reputation drew him to join the biotechnology research team. “Piper Jaffray has agreat name in research. On my first visit I noticed how down to earth the company is. This positive environmenthelps our talented team work together to produce world-class research.”

Stewart said that Piper Jaffray is known for its broad reachand proprietary research calls. “Piper Jaffray has one of thepremier health care research teams on the street because wefocus on quality. There is great emphasis on creating valuethat is distinguishable from the rest of the street.”

Meet the TeamThe team is composed of a patent attorney, practicingmedical doctors, pharmaceutical lab directors, scientists,business consultants and experienced financial researchanalysts.

Specialty PharmaceuticalsDeborah Knobelman, Ph.D; Mitul Desai; Navin Jacob

U.S. BiotechnologyThomas Wei; Gur Roshwalb, M.D.; Elizabeth Naldi

U.S. BiotechnologyRachel McMinn, Ph.D.; Hongbo Lu, Ph.D.

U.S. BiotechnologyTed Tenthoff; Gurpreet Ratra, Ph.D.

U.S. BiotechnologyCaroline Stewart; Chad Messer, Ph.D.

European BiotechnologySam Fazeli, Ph.D.; Tracy West; Richard Parkes, Ph.D.; SallyBennett, M.D.

Since 1895. Member SIPC and NYSE. Securities and products are offered in the United Kingdom through Piper Jaffray Ltd., which is an affiliate ofPiper Jaffray & Co., incorporated under the laws of England and Wales,authorized and regulated by the Financial Services Authority and a member of the London Stock Exchange.

© 2006 Piper Jaffray & Co. 11/06