To clarify the media report

Important resolutions of 2016 Annual General Shareholders’ Meeting
June 27, 2016
OBI Pharma Inc. announces the change of VP, Chief Medical Officer
August 10, 2016

1.Date of occurrence of the event: 2016/07/01
2.Company name: OBI Pharma, Inc.
3.Relationship to the Company (please enter ”head office” or ”affiliatecompany”): The Company head office
4.Reciprocal shareholding ratios: N/A
5.Name of mass media: Wealth Magazine No.506
6.Content reported: Wealth Magazine: Reports on Page 138, Bi-weekly version, No. 506, ‘OBI Pharma’s statements are considerably different with the one in ASCO’.
7.Cause of occurrence: Clarification of the reports on Page 138, Bi-weekly version, No. 506 of Wealth Magazine.
8.Countermeasures: Only targeting on the column with the headline of ‘Reveal the mysterious OBI Pharma’ published in biweekly version of Wealth Magazine on June 30 of year 105(Hereinafter referred to as ‘disputed column’), the clarification and statements are listed as follows,
(1)Briefing Moderator Rugo: This data is very interesting, but also controversial.The disputed column quoted General manager Huang’s statement, ‘The publishing of the paper is successful, manly people come to listen, and attracts lots of interests. ’Clarification: based on the live recordings, video scenes, the report of Dr. Rugo does give rise to a lively discussion, and the opinions from Dr. Rugo quoted by the disputed column: ‘This data is very interesting … and other statements”, after the inspection, it is not violated with what the general manager Huang’s statements.
(2)Steven Isakoff: The summary quoted Rugo’s saying, while it does not mean the consent, and he used the word of provocative twice to show the results are worthy of discussion, while the further test is necessary.The disputed column quoted Huang, the general manager’s statements: ‘The cancer expert Steven Isakoff totally agrees with the opinions of Rugo.’The Clarification: in fact, Steven Isakoff not only agrees with the conclusions of Dr. Rugo, and the trial results also provide some pretty valuable data. And both people use the word of provocative to describe this experiment, and the statements of General manager Huang shall appropriately reflect both people’s views.
(3)Rugo: The therapeutic effect of OBI-822 is irrelevant with the performance amount of the carbohydrate GloboH, or cannot find the correlation.David Miles: Shall figure out, for OBI-822 and KLH, which one is the protagonist of the first cause of an immune response.The disputed column quoted the statements of General Manager Huang, ‘Whether the carbohydrate is able to produce the antibodies, to fight against cancer, we do not have to worry about it, as this experiment provide the answer to that. ‘
Clarification: this narrative is based on the test results of OBI-822, indicating that for the patients with adequate antibody response to the vaccine, there will be the association of efficacy presented. And in the summary of his report, Dr. Rugo reported that, the treatment results of OBI-822 shows no relevance with the performance amount of Globo H; which is means that OBI-822 is a vaccine designed based on the antigen identification of Globo-H. This research has been confirmed that, for the treatment response to OBI-822, there is no significant correlation with/without the performance of the Globo-H; but after the treatment with OBI-822, the antibodies of Globo-H will be produced, and with the antibodies, there will be therapeutic effect; and the higher the antibody concentration, the better the effect is. Therefore, there is no conflict between general manager Huang’s statements and the statements of Dr. Rugo. As for David Miles’ opinion, for OBI-822 and KLH, which one is the primary factor for causing the immune response, and based on the test results, it seems that OBI-822 has been able to produce the specific antibody to fight against Globo H. Besides, according to the preclinical data, KLH itself cannot induce the specific antibody of Globo H.
(4)Rugo: The treatment effect of OBI-822 is irrelevant with sub-population, and the sample of the sub-population is too small to find the correlation with statistical meaning. The disputed column quoted general manager Huang’s statements about the sub-population:’’Box Company disputed the statement quoted Huang, general manager: ‘OBI Pharma do not use triple negative, Her2 + or ER + / PR + (hormone receptor positive response), and the evidence has been presented to the company clearly, we cannot wait to bring you today the presentation of the data to show you all. ‘
Clarification: The clinical trials of OBI-822-001 conclude all the sub-population, although the number of the sub-population is pretty small, it already shows the preliminary efficacy. And general manager Huang takes her views from the application aspect of the clinical data results, and she thinks that there is no necessary to confine a certain sub-population, and the opinion shares no difference with the views of Dr. Rugo.
(5)Charles L.Vogel: Causing an immune response does not mean having the efficacy, because some of the cancer is immune-free.The disputed column quoted the former president Wong Chi-huey who accidentally revealed 85% of patients had an immune response, and in the investors conference, the company emphasize that the data is much higher.
Clarification: in the investors conference, the company emphasize that the data might be much higher; about this statement, it generally refers to the patients who generate antibodies; Targeting at the analysis of progression-free survival (PFS) in this test, when injecting the OBI-822 vaccine, for the responders who produce the immunoglobulins up to 1:160 titer, compared to the control group and patients with no immune response, their progression-free survival presents significant improvement statistically. How to select the patients who can generate immune response to Globo H vaccine in future study will be further discussed and understood.
(6)The company reiterated that the purpose to hold the briefing session in Taiwan is to help the public understand the relevant facts of OBI-822 and it is not intended to affect the company’s share price. For the investors, please make the appropriate judgement about trading the company’s shares based on the relevant public information.
9.Any other matters that need to be specified: The results of a single clinical trial are not enough to fully reflect the success or failure of future development of new drugs listed, and the investors should carefully make the judgement and be prudent in their investment.For the new drugs, the development process is long, the expense is high and its success cannot be guaranteed. All these factors might make the investment risky, the investors should carefully make their call and be prudent in the investment.