BioSpecifics Technologies Corp. is a biopharmaceutical company that has developed injectable collagenase for eleven clinical indications. The company has a development and licensing agreement with Auxilium Pharmaceuticals, Inc. for injectable collagenase (XIAFLEX™). XIAFLEX was approved by the U.S. Food and Drug Administration (FDA) in February 2010 for the treatment of Dupuytren’s contracture in adults with a palpable cord in the palm. Two other promising lead indications for XIAFLEX include Peyronie's Disease and frozen shoulder (adhesive capsulitis).

Pfizer, Inc. is responsible for marketing XIAFLEX for Dupuytren's contracture and Peyronie's Disease in Europe and other territories.

Thomas L. Wegman, President

Mr. Wegman has served as an officer at BioSpecifics for more than 15 years and has been a member of the Board of Directors since 1994. Prior to his appointment as President on October 17, 2005, he served as the Executive Vice President of the Company. He has over 30 years of experience in the biopharmaceutical industry managing company operations, drug development, licensing and registration.

From 1978 to 1983, Mr. Wegman managed the production, marketing and foreign registration activities related to an avian vaccine business, Biota NV. Mr. Wegman has been instrumental in licensing technologies from universities for use by BioSpecifics. He is the author of a number of U.S. and foreign patents in the field of life sciences. Mr. Wegman received his B.A. from Boston University.

Collagenase is an enzyme that breaks down collagen and is the only protease that can hydrolyze the triple helical region of collagen under physiological conditions. The specific substrate collagen comprises approximately one-third of the total protein in mammalian organisms, and it is the main constituent of skin, tendon and cartilage, as well as the organic component of teeth and bone. The body relies on endogenous collagenase production to remove dead tissue, and collagenase production is an essential biological mechanism that regulates matrix remodeling and the normal turnover of tissue. The Clostridial collagenase produced by BioSpecifics has a broad specificity towards all types of collagen and is acknowledged as much more efficient than mammalian collagenases. Clostridial collagenase cleaves the collagen molecule at multiple sites along the triple helix, whereas the mammalian collagenase is only able to cleave the molecule at a single site along the triple helix. Because collagenase does not damage the cell membrane, it is widely used for cell dispersion for tissue disassociation and cell culture.

Histological and biochemical studies have shown that the tissue responsible for the deformities associated with Dupuytren's contracture and Peyronie's Disease is primarily composed of collagen. Treatment with injectable collagenase for removal of excessive scar tissue represents a first-in-class non-invasive approach to this unmet medical need.

BioSpecifics has developed a proprietary process to produce a purified collagenase product that is fully characterized and has shown stability over the course of many years.

• Dupuytren's contracture
• Peyronie's Disease
• Wound healing
• Improved debridement
• Removal of adipose tissue

In particular, the use of XIAFLEX™ for the treatment of Peyronie's Disease and Dupuytren's contracture has the following intellectual property protection:

• U.S. Orphan Drug designation status and seven years of market exclusivity after approval

• In Europe, BioSpecifics' partner Auxilium anticipates 10 year marketing exclusivity following approval

• U.S. use patents for collagenase for Dupuytren's contracture and Peyronie's Disease
• Certain foreign patents also cover these products in those countries
• As long as there is a pending claim, BioSpecifics is entitled to royalties in that territory under its agreement with Auxilium
• Potential exclusivity until 2027

BioSpecifics is partnered with Auxilium Pharmaceuticals, Inc. for injectable collagenase (XIAFLEX™). To date, the Company has received more than $15.0 million in payments. The Company is eligible for future milestone payments for additional indications, regulatory submissions in the United States and Europe and a percentage of sub-license income. Future low double digit royalties and markup on COGS will be received as a percentage of worldwide net sales. These payments are independent of indication, territory, sales volume and which company sells the product. In addition, Auxilium Pharmaceuticals is partnered with Pfizer for the development, commercialization and supply of XIAFLEX™ for Dupuytren's contracture and Peyronie's disease in 27 member countries of the European Union and 19 other European and Eurasian countries.

In addition, Pfizer will be primarily responsible for regulatory activities for XIAFLEX™ in these countries. BioSpecifics is entitled to receive 8.5% of the $395 million in additional potential future milestone payments that may be made by Pfizer to Auxilium, in addition to those due to it from its partnership with Auxilium.