1 Table of Contents 1 Table of Contents 2 1.1 List of Tables 3 1.2 List of Figures 3 2 Executive Summary 5 2.1 Large and Competitive Market Landscape Driven by Rising Prevalence 5 2.2 Investment in First-in-Class Innovation Remains Strong 5 2.3 Opportunities for Investment in First-in-Class Product Development are Considerable 5 3 The Case for Innovation 6 3.1 Growing Opportunities for Biologic Products 7 3.2 Diversification of Molecular Targets 7 3.3 Innovative First-in-Class Product Development Remains Attractive 7 3.4 Regulatory and Reimbursement Policy Shifts Favor First-in-Class Product Innovation 8 3.5 Sustained Innovation 8 3.6 GBI Research Report Guidance 8 4 Clinical and Commercial Landscape 10 4.1 Disease Overview 10 4.2 Classification of Diabetes Mellitus 10 4.3 Symptoms 11 4.4 Epidemiology 11 4.5 Etiology 12 4.6 Pathophysiology 12 4.7 Co-morbidities and Complications 14 4.8 Management and Treatment of Type 2 Diabetes Mellitus 16 4.8.1 Non-insulin T2DM Therapies 17 4.9 Insulin-Based T2DM Therapies 20 4.10 Overview of Marketed Products in Type 2 Diabetes 21 4.11 Unmet Need and Commercial Opportunities in T2DM 24 5 Assessment of Pipeline Product Innovation 25 5.1 Pipeline by Stage of Development, Molecule Type and Molecular Target 25 5.2 Comparative Distribution of Programs between the Market and Pipeline by Molecular Target Class 29 5.3 First-in-Class Programs by Molecular Target Category 29 6 Type 2 Diabetes Mellitus Signaling Network, Disease Causation and Innovation Alignment 48 6.1 Complexity of Signaling Networks 48 6.2 Signaling Pathways and First-in-Class Molecular Target Integration 48 6.3 First-in-Class Matrix Assessment 48 7 First-in-Class Target and Pipeline Program Evaluation 54 7.1 Pipeline Programs Targeting Insulin Receptor Substrate 1 and Insulin Receptor Substrate 2 54 7.2 Pipeline Programs Targeting G-Protein Coupled Receptor Kinase 5 (GRK5) 56 7.3 Pipeline Programs Targeting Type 2 Angiotensin II Receptor 57 7.4 Pipeline Programs Targeting Islet Amyloid Polypeptide (IAPP) 58 7.5 Pipeline Programs Targeting Nacht LRR and PYD Domains Containing Protein 3 60 7.6 Pipeline Programs Targeting Peroxisome Proliferator Activated Receptor Gamma Coactivator 1 Alpha (PPARGC1A) 61 7.7 Pipeline Programs Targeting Glucagon 62 7.8 Pipeline Programs Targeting Alpha Synuclein 64 7.9 Pipeline Programs Targeting Microtubule Associated Protein Tau 65 8 Strategic Consolidations 67 8.1 Industry-Wide First-in-Class Deals 67 8.2 Licensing Deals 68 8.3 Co-development Deals 71 8.4 First-in-Class Programs Not Involved in Licensing or Co-development Deals 74 9 Appendix 80 9.1 References 80 9.2 Abbreviations 85 9.3 Research Methodology 86 9.4 Secondary Research 86 9.4.1 Market Analysis 86 9.4.2 Pipeline Analysis 86 9.4.3 First-in-Class Matrix Assessment 87 9.4.4 First-in-Class Target Profiles 87 9.4.5 Licensing and Co-development Deals 87 9.5 Contact Us 87 9.6 Disclaimer 87

1.2 List of Figures Figure 1: Type 2 Diabetes Mellitus, Global, Innovation Trends in Product Approvals Across the Pharmaceutical Market, 1987-2014 6 Figure 2: Type 2 Diabetes Mellitus, Global, Post-Marketing-Approval Sales Performance of First-in-Class and Non-First-in-Class Products Across Pharmaceutical Industry ($m), 2006-2013 8 Figure 3: Type 2 Diabetes Mellitus, Global, Marketed Products by Molecule Type, 2016 22 Figure 4: Type 2 Diabetes Mellitus, Global, Marketed Products by Molecular Target, 2016 23 Figure 5: Type 2 Diabetes Mellitus, Global, Pipeline Size by Therapy Area, 2016 25 Figure 6: Type 2 Diabetes Mellitus, Global, Pipeline by Stage of Development and Molecule Type, 2016 26 Figure 7: Type 2 Diabetes Mellitus, Global, Pipeline by Molecular Target and Stage of Development, 2016 27 Figure 8: Type 2 Diabetes Mellitus, Global, Pipeline Breakdown of GPCR and Protein Kinase Molecular Target, 2016 28 Figure 9: Type 2 Diabetes Mellitus, Global, Distribution of Pipeline and Marketed Products by Molecular Target Class, 2016 29 Figure 10: Type 2 Diabetes Mellitus, Global, Distribution of Pipeline Products by First-in-Class Status and Molecular Target Class, 2016 31 Figure 11: Type 2 Diabetes Mellitus, Global, Percentage Distribution of First-in-Class and Non-First-in-Class Pipeline Products by Stage of Development, 2016 32 Figure 12: Type 2 Diabetes Mellitus, Global, Percentage Distribution of First-in-Class and Non-First-in-Class Pipeline Products by Molecular Target Class, 2016 32 Figure 13: Type 2 Diabetes Mellitus, Global, Ratio of First-in-Class Targets to First-in-Class Products by Stage of Development, 2016 33 Figure 14: Type 2 Diabetes Mellitus, Global, Ratio of First-in-Class Targets to First-in-Class Products by Molecular Target, 2016 33 Figure 15: Type 2 Diabetes Mellitus, Global, All Pipeline Products, 2016 (part 1) 34 Figure 16: Type 2 Diabetes Mellitus, Global, All Pipeline Products, 2016 (part 2) 35 Figure 17: Type 2 Diabetes Mellitus, Global, All Pipeline Products, 2016 (part 3) 36 Figure 18: Type 2 Diabetes Mellitus, Global, All Pipeline Products, 2016 (part 4) 37 Figure 19: Type 2 Diabetes Mellitus, Global, All Pipeline Products, 2016 (part 5) 38 Figure 20: Type 2 Diabetes Mellitus, Global, All Pipeline Products, 2016 (part 6) 39 Figure 21: Type 2 Diabetes Mellitus, Global, All Pipeline Products, 2016 (part 7) 40 Figure 22: Type 2 Diabetes Mellitus, Global, All Pipeline Products, 2016 (part 8) 41 Figure 23: Type 2 Diabetes Mellitus, Global, All Pipeline Products, 2016 (part 9) 42 Figure 24: Type 2 Diabetes Mellitus, Global, All Pipeline Products, 2016 (part 10) 43 Figure 25: Type 2 Diabetes Mellitus, Global, All Pipeline Products, 2016 (part 11) 44 Figure 26: Type 2 Diabetes Mellitus, Global, All Pipeline Products, 2016 (part 12) 45 Figure 27: Type 2 Diabetes Mellitus, Global, All Pipeline Products, 2016 (part 13) 46 Figure 28: Type 2 Diabetes Mellitus, Global, All Pipeline Products, 2016 (part 14) 47 Figure 29: Type 2 Diabetes Mellitus, Global, First-in-Class Molecular Target Analysis Matrix Part 1, 2016 50 Figure 30: Type 2 Diabetes Mellitus, Global, First-in-Class Molecular Target Analysis Matrix Part 2, 2016 51 Figure 31: Type 2 Diabetes Mellitus, Global, First-in-Class Molecular Target Analysis Matrix Part 3, 2016 52 Figure 32: Type 2 Diabetes Mellitus, Global, First-in-Class Molecular Target Analysis Matrix Part 4, 2016 53 Figure 33: Type 2 Diabetes Mellitus, Global, Industry-Wide Licensing Deals by Stage of Development, 2006-2016 67 Figure 34: Type 2 Diabetes Mellitus, Global, Industry-Wide Licensing Deals by Deal Value, Upfront Payment Value, Stage of Development and First-in-Class Status ($m), 2006-2014 68 Figure 35: Type 2 Diabetes Mellitus, Global, Licensing Deals by Region, Value and Year, 2006-2016 69 Figure 36: Type 2 Diabetes Mellitus, Global, Licensing Deals by Stage of Development, Deal Value and Upfront Payment Value, 2006-2016 70 Figure 37: Type 2 Diabetes Mellitus, Global, Number and Aggregate Deal Value of Licensing Deals by Molecule Type, 2006-2016 71 Figure 38: Type 2 Diabetes Mellitus, Global, Frequency and Aggregate Deal Value of Licensing Deals by Molecular Target, 2006-2016 71 Figure 39: Type 2 Diabetes Mellitus, Global, Co-development Deals by Region and Deal Value and Year, 2006-2016 72 Figure 40: Type 2 Diabetes Mellitus, Global, Co-development Deals by Stage of Development, Deal Value and Upfront Payment Value, 2006-2016 73 Figure 41: Type 2 Diabetes Mellitus, Global, Number and Aggregate Deal Value of Co-development Deals by Molecule Type, 2006-2016 73 Figure 42: Type 2 Diabetes Mellitus, Global, Frequency and Aggregate Deal Value of Co-development Deals by Molecular Target, 2006-2016 74 Figure 43: Type 2 Diabetes Mellitus, Global, Deal Involvement of First-in-Class Programs, 2016 (part 1) 75 Figure 44: Type 2 Diabetes Mellitus, Global, Deal Involvement of First-in-Class Programs, 2016 (part 2) 76 Figure 45: Type 2 Diabetes Mellitus, Global, Deal Involvement of First-in-Class Programs, 2016 (part 3) 77 Figure 46: Type 2 Diabetes Mellitus, Global, Deal Involvement of First-in-Class Programs, 2016 (part 4) 78 Figure 47: Type 2 Diabetes Mellitus, Global, Deal Involvement of First-in-Class Programs, 2016 (part 5) 79