BVF Partners LP

Item 5 – Fees and Compensation

Compensation paid to BVF is negotiable and varies but typically consists of the following
components:

Investment Management Fee

For the BVF Funds, BVF generally receives a management fee at an annual rate of 1% or 1.5% of
the related assets under management. The management fee paid by BVF Fund investors depends
upon the class of interests owned in such BVF Fund, as detailed in such BVF Fund’s confidential
offering memorandum. Management fees are deducted on a quarterly basis from the capital
account of each investor and are calculated based on the balance in an investor’s capital account
in the BVF Fund, as of the beginning of each quarter. An investor in a BVF Fund whom BVF
permits to make a capital contribution on a date other than the first day of a calendar quarter will
be charged a prorated management fee with respect to such capital contribution. Due to redemption
notice and liquidity restrictions, a management fee will have been earned at the point of
redemption. In unusual circumstances where an investor is permitted to withdraw from a BVF
Fund during a calendar quarter, BVF will refund a pro rata portion of the management fee
applicable to the withdrawn capital for that quarter, based on the actual number of days remaining
in the quarter divided by the total number of days in the quarter.

For Single Investor Funds and Managed Accounts, the management fee is negotiated with the
investor and account owners. Management fees in respect of Single Investor Funds are deducted
on a monthly basis and are calculated based on the balance of such investor’s capital account in
such Single Investor Fund as of the beginning of each month.

For Managed Accounts, it is up to each Managed Account owner whether to have the management
and performance fees withdrawn directly from their custodian account or to pay by check or wire
transfer. BVF will send an invoice to all Managed Account Clients who choose not to have
management and performance fees withdrawn directly from their custodian account. The invoice
is payable upon receipt and will include the fee calculation and the amount due. For Managed
Accounts who elect to have management and performance fees withdrawn directly from their
custodian account, BVF will send a statement, to both the investor and the custodian that will
include the fee calculation and the amount due. It is the investor’s responsibility to verify the
accuracy of the fee calculation. The custodian will not determine whether the fee is properly
calculated. Currently, BVF does not deduct its fees from any Managed Account.

Performance-Based Allocation or Fee

BVF GP Holdings LLC (“BVF GP LLC”) (directly or through its wholly-owned subsidiaries)
receives a performance-based allocation paid in arrears from the BVF Funds derived from the net
profits of each investor’s investment in such Fund. Performance-based allocations for each
investor in the BVF Funds generally equal 20% or 25% per annum of net profits (including both
realized and unrealized gains and losses) in excess of a “high water mark” attributable to such
BVF Fund investor’s capital account, depending on the class of BVF Fund interest owned, as
detailed in the BVF Fund’s confidential offering memorandum. Upon a partial withdrawal from a
BVF Fund, any unpaid portion of performance-based allocations will be determined and due on a
pro rata basis.

For Single Investor Funds, BVF generally receives a performance-based allocation from the Single
Investor Fund derived from the net profits of the investor’s investment in such Fund. Performance-
based allocations in the Single Investor Fund generally equal 20% of net realized profits in excess
of a “high water mark” attributable to the investor’s capital account, as detailed in the Single
Investor Fund’s confidential offering memorandum.

BVF receives a performance-based fee from the Managed Accounts derived from the net profits
of each investor’s investment in a Managed Account. Performance-based fees for Managed
Accounts generally equal 20% per annum of net profits (including both realized and unrealized
gains and losses) in excess of a “high water mark” attributable to each Managed Account, as
detailed in the Managed Account’s investment advisory agreement. Typically, upon a partial
withdrawal by a Managed Account, any unpaid portion of performance-based fees will be
determined and due on a pro rata basis.

Performance-based allocations or fees are charged in accordance with the requirements of Rule
205-3 under the Investment Advisers Act of 1940 (the “Advisers Act”), and BVF will not accept
clients who do not satisfy the eligibility criteria for making investments subject to incentive
compensation.

In certain circumstances, fees and allocations for certain prospective investors in a BVF Fund may
be individually negotiated (e.g., in a side letter as described below). Such circumstances may
include the size or nature of the investment, or a commitment to remain invested for an extended
period of time. Negotiated fees may be higher or lower, or calculated differently, than those
summarized above or will, in certain circumstances, be waived. It should be noted that BVF
principals and employees invested alongside other investors in the BVF Funds are not charged
management fees or assessed performance-based allocations.

Fees and allocations relating to a Single Investor Fund or Managed Account are individually
negotiated and may differ from those that apply to investors in the BVF Funds. Negotiated
management fees and performance-based allocations or fees may be higher or lower, or calculated
differently than those applicable to the BVF Funds or may, in certain circumstances, be waived.

Additional Fees and Expenses

Each Client will also generally bear direct and indirect costs, fees and expenses incurred by or on
behalf of such Client including, among others, all costs and expenses of organizing and/or
...

Item 7 – Types of Clients

As noted in Item 4 - Advisory Business, BVF currently provides investment advice to the BVF
Funds, the Single Investor Fund and the Managed Accounts.

The minimum investment for an investor in a BVF Fund is $25 million, which BVF GP LLC, in
its sole discretion, may waive. Also, investors in a Fund must meet the investor qualifications
associated with such Fund.

The Single Investor Fund and Managed Accounts are subject to individually negotiated terms.
Further, the opportunity to organize a Single Investor Fund or open a Managed Account with us is
not available to all prospective investors and clients. BVF determines in its sole discretion whether
to allow a prospective investor or client to organize a Single Investor Fund or open a Managed
Account, respectively, based on a variety of factors. Additionally, each type of account is generally
subject to minimum asset levels, also as determined in our sole discretion.

Investors in the BVF Funds and the Single Investor Fund and the Managed Account owners
include high net worth individuals, family offices and multi-family offices, funds of hedge funds,
endowments, and pension plans (ERISA & Non-ERISA), corporations and other entities who are
(1) “accredited investors” and (2) either “qualified purchasers” or “qualified clients,” as such terms
are defined in the federal securities and investment company laws.

BVF requires that all investors in the Funds, as well as owners of Managed Accounts, represent to
BVF in writing that they are — either themselves or together with their professional advisers —

financially sophisticated and able to evaluate the merits and risk of their investment, including the
risk of a total loss.