ANNUAL REPORT 2014

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LETTER FROM THE PRESIDENT ABOUT BIOGENERATOR OUR APPROACH OUR PORTFOLIO 2014 INVESTMENTS COMPANY FOCUS COMPANY HIGHLIGHTS BIOGENERATOR LABS INVESTMENT TEAM INVESTMENT ADVISORY COMMITTEE ENTREPRENEURS IN RESIDENCE

COMMITMENT TO OUR MISSION 2014 was a year characterized by substantial progress at BioGenerator, yet it also served as a reminder of ongoing and new challenges as we manage a diverse, expanding, and maturing portfolio of life science companies. The BioGenerator team strives to balance a complex set of objectives consistent with our mission: building strong companies; investing in a diverse range of life science sectors; supporting a range of business models from those that appeal to investors to others with more rapid paths to job creation; leveraging and expanding the regional talent pool; educating first-time entrepreneurs; and assisting regional partners.

Strong Portfolio Performance 2014 brought another strong year for the overall portfolio. We leveraged our largest annual investment budget to date across a mix of new portfolio companies (utilizing our early-stage investment programs) and follow-on investments. Consistent with our investment strategy, we sought to align capital with portfolio company quality, deploying larger amounts of capital into our most mature and strongest companies, while reaching “No Go” decisions following limited capital spend on several early-stage companies and pre-company technologies.

Given that the majority of companies enter our portfolio as preseed investments, for the last few years we have focused on maturing our portfolio and positioning our stronger companies to raise larger sums of money. Many of our companies have competed very successfully for early-stage capital in St. Louis’ expanding life science ecosystem. The strongest amongst them have advanced to face new challenges as their capital needs exceed the capacity of our regional ecosystem, and they compete for national sources of capital in a shrinking venture market. The number of ag funds nationwide has never been large, and the Midwest pool of healthcare venture funds remains small in the face of a growing capital gap as institutional investors conserve funds and are more risk-averse.

BioGenerator investment activity was substantially augmented by syndication of our deals and by follow-on investments from others. In 2013, BioGenerator invested $3.1M and benefitted from $20.9M in leveraged funding across our portfolio. 2014 built upon that momentum: BioGenerator deployed $3.4M in funding while enjoying in excess of $40M in portfolio leverage. In 2013, our companies attracted $7M in leverage from outside the St. Louis region; in 2014 that number was 4-fold higher, reflecting a continuing maturity of the portfolio. We are truly proud of the roles we played to build and support our portfolio in these activities.

The major challenges and associated uncertainty of the life science investment sectors actually underscore BioGenerator’s passion and strengths as an investor in, and builder of, life science companies. We are committed to providing companies and entrepreneurs with objective advice, financial support, and capital-efficient services through good times and lean. Our staff works to continually deepen our own capabilities and expand and strengthen our programs. What distinguishes BioGenerator as an organization is how we serve companies with commitment, expertise, teamwork, and integrity. It set us apart again in 2014.

Post-Seed & Concept Fund BioGenerator has been proactively working to address challenges in startup financing. Over the past two years, we have introduced two new funds in order to address gaps at the two ends of our funding continuum. In Q3 2013, we launched our “Post-Seed” fund in recognition of the growing capital gap between Seed funding and venture rounds led by major institutional investors. This funding mechanism is a critical addition to our Pre-Seed and Seed funds and has helped catalyze or assemble syndicated rounds enabling investment in key milestones. In 2014, we committed a substantial portion of our annual investment budget to this purpose; several of these companies are now seeking major

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institutional rounds. At the other end of the investment spectrum, we formalized our “Concept” fund in 2014. This fund is a valuable tool, to both our investment team and to entrepreneurs, as a component of our staged strategy to leverage very small amounts of capital in order to de-risk a number of early ideas and, in some cases, to address key issues before companies are even formed. These early “rock-turning” projects, in some cases facilitated by the capital equipment available within the BioGenerator Labs, enable our team to quickly react to and evaluate innovative ideas and new entrepreneurs. We have utilized this new fund as an additional mechanism to assist regional university partners in assessing the commercial merit of their inventions. BioGenerator Labs: First full year of expanded labs A critical component of our investment strategy is the BioGenerator Labs. In 2010, BioGenerator opened a unique wet laboratory facility designed to address barriers to commercialization of earlystage life science technology. The BioGenerator Labs serve as an innovation center containing wet labs amply furnished with equipment & instrumentation, along with office and conference room space. BioGenerator offers access to this shared space facility at no cost to occupants, realizing substantial efficiencies. After the first few years of operating the labs, we concluded that the facility was highly impactful on our investment strategy. At which point, we were able to acquire adjacent space and, by late

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2013, had tripled our footprint. The Labs are now a critical enabler, in particular for our therapeutics and diagnostics sectors. Today, over 25 companies reside in the BioGenerator Labs. Compared to traditional investment paradigms, we are able to incubate a company within our space at greatly reduced capital expenditures. The full value of the Labs results not just from the capital efficiencies, but talented individuals that have been attracted to the space and the ensuing culture that has developed. Our companies have attracted highly-experienced industry scientists and executives to work in the facility, and a number of new projects and companies have emerged from collaborations between employees at different companies. For minimal added costs, we can support university faculty/staff spinning out technologies and unaffiliated entrepreneurs evaluating innovative but high risk new ideas. We are excited to see how the Labs have evolved to be an epicenter of innovative activity, particularly in the therapeutics sector. Acknowledgements BioGenerator’s parent organization, BioSTL, advances the economic vitality of the St. Louis region by cultivating a strong bioscience and innovation ecosystem. BioSTL organizes business, university, and philanthropic leaders around a set of deliberate strategies that capitalize on St. Louis’ strengths in medical and plant sciences. Focus areas include: improving access to investment capital; ensuring appropriate physical infrastructure; promoting science-

and innovation-friendly public policy; fostering a more inclusive entrepreneurial talent pool in the region; attracting the U.S. presence of international companies; and communicating St. Louis’ strengths. BioGenerator and BioSTL staffs collaborate in the development and implementation of many of these programs, which are important complements to BioGenerator’s company building mission. BioGenerator would not be able to fulfill its mission without the strong support of BioSTL’s Board and the generous funding commitments of our stakeholders. The vision and long-term support from Dr. William Danforth, John McDonnell, and Donn Rubin have been essential to our success, as has the support of the BioSTL Board over the past three and a half years. Major 2014 funders of BioSTL, and by extension of BioGenerator’s work, include Washington University, BJC HealthCare, St. Louis Life Sciences Project, Monsanto, Boeing, Ascension Health, CrawfordTaylor Foundation, Blackstone Charitable Foundation, and JPMorgan Chase Foundation. We have also received funding for specific programs from public sector entities: Missouri Technology Corporation, the Helix Fund of St. Louis County, and the Economic Development Administration of the US Department of Commerce. To these funders, we are eternally grateful for their support and commitment to our mission.

dedicated staffs at BioGenerator and BioSTL who embrace the daily challenges that must be addressed in order to fulfill our mission. Their approach is embodied by commitments to rigorous due diligence on deals, long-term support for startup companies and entrepreneurs, partnerships with multiple organizations and institutions in our community, strong relationships with other investors, and fund raising. Our goals are very ambitious -driven by the desire to enable startups to develop products and services that improve the quality of health and the human condition while helping to transform the St. Louis economy. As President of BioGenerator, I’m very grateful to lead our team and am excited about the opportunities to enable our portfolio companies to advance in 2015.

Eric Gulve President, BioGenerator

BioGenerator’s impact in our community is driven by the

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ABOUT BIOGENERATOR

BioGenerator is an evergreen investor that creates, grows, and invests in promising companies and entrepreneurs in the St. Louis region. BioGenerator identifies and de-risks commercially-promising innovations and services; advises innovators and entrepreneurs; recruits and supports entrepreneurial talent; makes staged investments grounded in rigorous due diligence; and offers access to lab space and capital equipment. We position companies to navigate the unique challenges of early-stage bioscience company development. BioGenerator’s work spans the early stage startup lifecycle of companies within the health and plant sciences, including therapeutics, diagnostics, medical devices, research tools, agriculture, and health IT. BioGenerator is a nonprofit subsidiary of BioSTL, working together to advance the economic vitality of St. Louis by cultivating a thriving bioscience sector. BioSTL, a 501(c)3 nonprofit organization, builds the regional innovation ecosystem, nurtures a collaborative environment, and focuses community leadership and resources to capitalize on St. Louis’ world class medical and plant biosciences.

“BIOGENERATOR HAS BEEN INSTRUMENTAL IN OPENING UP THE COMMERCIALIZATION OF CREATIVE LIFE SCIENCES RESEARCH BEING PERFORMED IN THE ST. LOUIS REGION. THAT SOUNDS EASY, BUT IT IS A VERY DIFFICULT, LONG, AND EXPENSIVE PROCESS OF EVALUATING, PLANNING, NURTURING, FUNDING, REDIRECTING, MENTORING, AND SOMETIMES SHUTTING DOWN PROMISING IDEAS. IT TAKES CREATIVITY, PERSISTENCE, PATIENCE (BUT ALSO IMPATIENCE), AND A DEEP UNDERSTANDING OF THE BUSINESS CREATION PROCESS.” -JOHN MCDONNELL

BIOGENERATOR’S TOTAL INVESTMENT OF

$10.3 MILLION HAS BEEN LEVERAGED

19 TO 1

OUR APPROACH

We position our portfolio companies to raise syndicated and follow-on investments and to navigate the unique challenges of company development. With the goal of removing barriers to entrepreneurial success, we collaborate with our portfolio companies in three primary ways: Improving access to capital by making investments across multiple early stages and developing strategic relationships with qualified investors. Providing strategic advisory services to innovators and entrepreneurs, focused on company building and identifying strong talent.

Ensuring access to collaborative lab space and state-of-the-art equipment to create capital efficiency for portfolio companies.

INVESTMENT ACTIVITY

NOTES: * BioGenerator seeks to syndicate with other investor deals at the Pre-Seed, Seed and Post-Seed Fund Stages. **The Seed Fund deals are presented to BioGenerator’s external Investment Advisory Committee.

ALIGNMENT OF CAPITAL AND QUALITY

The BioGenerator investment philosophy is built around the goal of making the largest investments in companies who prove, over time and based on accomplishment of milestones, that they are the most likely to achieve success and to accomplish our mission.

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OUR PORTFOLIO CONCEPT HEALTHYME HEALTH IT

PRE-SEED ARCH INNOTEK NUTRITION ARTA BIOSCIENCES THERAPEUTICS ARRAY BRIDGE RESEARCH TOOLS ARVEGENIX AGRICULTURE DAYA CNS THERAPEUTICS EDIS SOLUTIONS HEALTH IT EPIGENETX THERAPEUTICS IMMUNOPHOTONICS THERAPEUTICS MEDSOCKET HEALTH IT MOBIUS ABX THERAPEUTICS NANOPORE DIAGNOSTICS PMDI DIAGNOSTICS 6

BIOGENERATOR’S ACTIVE PORTFOLIO CONSISTS OF

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COMPANIES

SARMONT CRO SEVEN SIGHTS DIAGNOSTICS SYNERZ MEDICAL MEDICAL DEVICE TANSNA THERAPEUTICS TRAXXSSON DIAGNOSTICS XTEND ENERGY ENERGY YOURBEVCO RETAIL PRODUCT

SEED

POST-SEED

ANTEGRIN THERAPEUTICS APSE AGRICULTURE APT THERAPEUTICS THERAPEUTICS EUCLISES THERAPEUTICS GENERICO THERAPEUTICS GRAEMATTER HEALTH IT KOGENT MEDICAL DEVICE KYPHA DIAGNOSTICS MIDWAY ANIMAL HEALTH NEUROLUTIONS MEDICAL DEVICE

BACTERIOSCAN MEDICAL DEVICE BENSON HILL AGRICULTURE CARDIALEN MEDICAL DEVICE CONFLUENCE THERAPEUTICS MEDIBEACON MEDICAL DEVICE MOBIUS TX THERAPEUTICS PULSE TX MEDICAL DEVICE VASCULOX THERAPEUTICS

GRADUATES & EXITS ADARZA RESEARCH TOOLS AKERMIN ENERGY APERTUS PHARMA CRO CONFLUENCE DISC. CRO ELECTROCHAEA ENERGY

GALERA THERAPEUTICS IONIC TRANSPORT CRO NAWGAN RETAIL PRODUCT PIXELEXX RESEARCH TOOLS VENGANZA AGRICULTURE

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2014 INVESTMENTS CONCEPT FUND

PRE-SEED FUND

SEED FUND

POST-SEED FUND

ARCH INNOTEK* EDIS SOLUTIONS* HEALTHYME

ANTEGRIN* ARCH INNOTEK* ARVEGENIX DAYA CNS EDIS SOLUTIONS* EPIGENETX IMMUNOPHOTONICS MEDSOCKET MOBIUS ABX* PMDI SYNERZ* TRAXXSSON YOURBEVCO

ANTEGRIN* APSE* EUCLISES KOGENT KYPHA

BACTERIOSCAN BENSON HILL* CONFLUENCE MEDIBEACON PULSE TX VASCULOX

FUNDED PROJECTS ACCURONIX TX ARCSENTRY TECH CONTREMETS DIAPEUTICS IXIENCE MOBIUS ABX* PROVETIS Includes pre-company and other activities

* COMPANIES RECEIVED MULTIPLE INVESTMENTS IN 2014

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BIOGENERATOR MADE

30 INVESTMENTS IN 24 COMPANIES IN 2014

COMPANY FOCUS Arvegenix is the industry leader in the development of Field Pennycress as a significant new crop for the corn-soy growing regions of the world. The oil from Pennycress seed has excellent properties for biodiesel and aviation fuels, and Pennycress meal has an excellent nutritional profile for ruminant livestock. Pennycress grows over winter between the corn-soy rotation, thereby providing growers with an additional revenue crop. Additionally, inclusion of Pennycress provides the environmental benefits of cover crops by reducing nitrogen leaching and increasing the organic content of soil. In 2014, Arvegenix raised a Pre-Seed round of capital, expanded its already strong management team of agriculture leaders, established a robust germ plasm collection, and made significant progress in field studies. BioGenerator led Arvegenix’s first external financing in July of 2014 and has supported the founders with business development services since early 2013.

“Arvegenix has a world class management team, leverages an enormous ‘dormant asset,’ and bridges the food vs. fuel debate.” - Edward Hamati

Benson Hill Biosystems is an agricultural biotechnology company dedicated to increasing crop productivity, principally by improving photosynthesis. Through a strategic relationship with the Donald Danforth Plant Science Center, the company has gained access to world-class research and growth facilities. Benson Hill benefits from renowned academic founders and a management team comprised of experienced agbiotech executives. In 2014, Benson Hill announced partnerships with J.R. Simplot Company, one of the largest privately-held food and agribusiness companies in the United States, and Centro de Tecnologia Canavieira (CTC), a market leader in Brazilian sugarcane. The company also received two National Science Foundation grants and completed a round of financing. BioGenerator led Benson Hill’s first external financing in 2012 and has subsequently invested two additional times to fuel the company’s growth.

“Benson Hill features a significant market opportunity, strategic partners globally, and harnesses the tremendous scientific capabilities of the Donald Danforth Plant Science Center.” - Dan Broderick 9

COMPANY FOCUS MediBeacon is a clinical stage company developing technology to measure kidney function. Today, standard methods provide only indirect renal function estimates days after injury. MediBeacon’s Optical Renal Function Monitor measures, rather than estimates, kidney function and provides these measurements in real-time. MediBeacon’s system consists of an optical sensor placed on the skin (similar to a pulse oximeter) and a proprietary biocompatible pharmaceutical fluorescent tracer agent. In 2014, MediBeacon completed two human clinical studies demonstrating proof of concept and raised significant investment capital.

Mobius Therapeutics is a commercial stage venture focused on ophthalmic surgery solutions. Its first product, Mitosol®, is a system for delivering antifibrotic agents in glaucoma, refractive, and corneal surgery. Mitosol is ophthalmic mitomycin, stored at room temperature, with a 24-month shelf life. It is prepared in surgery without protective clothing or equipment. Approved in 2012, Mitosol has become the “Gold Standard” in filtering surgery. Mobius benefits from four issued US patents, with patents issued and pending around the globe, and three unique Orphan Drug Designations.

MediBeacon’s fluorescent technology is also being developed for other medical applications, including intraoperative surgical visualization and gastrointestinal permeability.

In 2014, Mobius expanded their sales for, and received authorization from, the Department of Health and Human Services that the use of Mitosol is reimbursable by Medicare/ Medicaid. Mobius recently launched a second major program, Mobius ABX, for new ophthalmic antibiotic products through the same 505(b)(2) abbreviated regulatory process.

BioGenerator was the first investor in MediBeacon and has participated in three rounds of financing totaling $500K in BioGenerator investment. MediBeacon utilizes the BioGenerator Labs for analytical chemistry.

“MediBeacon began as a management buy-out of late-stage assets from a strategic. The strong team achieved exciting clinical validation in 2014.” - Charlie Bolten 10

BioGenerator invested early in the company’s history in 2011, in a Post-Seed round of growth capital in 2014, and is the first investor in Mobius ABX.

“From inception, this company featured an innovative business model combined with low regulatory risk. 2014 saw exciting revenue growth.” - Dan Broderick

SINCE INCEPTION, BIOGENERATOR HAS INVESTED

$10.3 MILLION IN

54 COMPANIES

Vasculox is a biotechnology company focused on the development of proprietary antibody drugs for life-threatening disorders driven by CD47-mediated signaling pathways. Examples of these disorders include leukemia, lymphoma, solid tumors, pulmonary hypertension, and delayed graft function following solid organ transplantation. The company was founded by Professor William Frazier of Washington University and benefits from a management and technical team of ex-industry leaders with deep experience in drug development. In 2014, Vasculox made significant technical progress with its panel of anti-CD47 antibodies for various clinical indications, secured over $1M of investment capital, received additional SBIR financing, and expanded its technical team and board. BioGenerator led Vasculox’s first two financings and has invested a total of $525K in the company. Vasculox is headquartered at the BioGenerator Labs.

“By harnessing the immune system, Vasculox is a leader in an exciting new field of human health. The company leverages world-class science from Washington University in St. Louis.” - Charlie Bolten 11

COMPANY HIGHLIGHTS ADARZA BIOSYSTEMS

In 2014, Adarza BioSystems completed a $6.8M Series A financing that included capital from BioGenerator, Siemens Ventures, Missouri Technology Corporation, Serra Capital, Arch Grants, Arch Angels, Rochester Angel Fund, and Cultivation Capital Life Science Fund. The company also signed a supply and licensing agreement with Horizon Discovery. Founded in New York, Adarza expanded its operations to St. Louis in March of 2013 with investment from BioGenerator.

BACTERIOSCAN In 2014, BacterioScan completed a $6 million Series A financing round that included capital from BioGenerator, Missouri Technology Corp., and Warson Capital Partners. The company also collaborated with the Centers for Disease Control on Rapid Antimicrobial Susceptibility Testing (AST) using BacterioScan’s instrument and determined the system can decrease the time to results by 75%.

CARDIALEN Cardialen had a productive 2014, including closing a $3.3M Series A round used to advance the translation of the published pre-clinical studies into acute human optimization research studies. In addition, seven patents were issued, bringing the total to 9 issued patents. The company has reduced risk and increased value of the company through advancement of therapy optimization and IP protection.

CONFLUENCE LIFE SCIENCES In 2014, Confluence concluded a venture-backed financing with investments from BioGenerator, Missouri Technology Corp., Epidarex Capital, and Mercury Fund. Confluence advanced multiple compounds toward clinical testing for oncology and inflammation, hired additional management, hired its 33rd employee, and increased revenue each quarter compared to 2013.

KOGENT SURGICAL In early 2014, Kogent Surgical signed a Worldwide Distribution Agreement with Medtronic. This agreement helped to increase revenues in 2014 by a factor of 10 over 2013. Sales growth has allowed the employee base to increase to over 60 with a probable target need of 95 by year-end 2015. Kogent has two important new surgical products almost through the FDA 510K process.

PULSE THERAPEUTICS In 2014, Pulse finalized its First In Human clinical trial and presented the exciting results at the European Stroke Conference. Druing the calendar year, the company raised $3.3M in fresh capital, which included support from BioGenerator, FTL Capital, Cultivation Capital, Arch Angels, Holton Capital, and many other new investors. Pulse also received an additional $2M of non-dilutive funding from the NIH.

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BIOGENERATOR LABS

The BioGenerator Labs provides access to collaborative lab and office space and state-of-the-art equipment for portfolio and preincubator companies. The BioGenerator Labs is a critical asset for companies overcoming barriers to company creation through:

Creating capital efficiency for client companies Maintaining a facility with multiple companies and deep industry expertise Fostering an innovative and collaborative environment

The BioGenerator Labs is an 18,000 square-foot pre-equipped facility located in St. Louis’ midtown Cortex innovation district. It provides facilities for promising, but very early stage, companies. Access to the facility reduces costs for tenant companies while offering the space and equipment necessary to move research forward and drive a company to its next funding milestones.

INVESTMENT TEAM ERIC GULVE, PH.D.

DAN BRODERICK

CHARLIE BOLTEN

EDWARD HAMATI

PRESIDENT

VICE PRESIDENT

DIRECTOR, CAPITAL FORMATION

ERIC MILLER, PH.D.

CRYSTAL WINKELER, PH.D.

CHARLENE BUCKLEY

KAMYLA TOMISER

SENIOR INVESTMENT ANALYST

PROGRAM COORDINATOR

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VICE PRESIDENT

INVESTMENT ANALYST

EXECUTIVE ASSISTANT

INVESTMENT ADVISORY COMMITTEE NATHAN LAKEY

CEO, ORION GENOMICS

BRIAN CLEVINGER, PH.D.

MANAGING DIRECTOR, PROLOG VENTURES

PETER FINLEY

CO-FOUNDER, THOMPSON STREET CAPITAL

MARY JO GORMAN, M.D.

FOUNDER, ADVANCED ICU CARE

MICHAEL KINCH, PH.D.

ASSOCIATE VICE CHANCELLOR, WASHINGTON UNIV. ST. LOUIS

STEVE HANLEY

CEO, MEDIBEACON

JOHN MCKEARN, PH.D.

MANAGING DIRECTOR, RIVERVEST VENTURE PARTNERS

RAUL PEREZ, M.D.

MANAGING DIRECTOR, OAKWOOD MEDICAL VENTURES

RICK RYAN, PH.D.

GENERAL PARTNER, CULTIVATION CAPITAL

WALTER SMITH

CEO, CONFLUENCE LIFE SCIENCES

DAVID SMOLLER, PH.D.

GENERAL PARTNER, CULTIVATION CAPITAL

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ENTREPRENEURS IN RESIDENCE

BioGenerator seeks to identify experienced professionals with strong backgrounds including management, operating, and scientific expertise. The Entrepreneur in Residence team has three primary roles: Support portfolio companies



Assist in the evaluation of investments



Develop new ventures



JOE BLECHL

RANDY LANGSTON

PAUL OLIVO, M.D., PH.D.

VIJAY CHAUHAN

ALAN MACINNES

DENNIS SHAFER

RAJ DEVRAJ, PH.D.

JIM MCCARTER, M.D., PH.D.

KELVIN TAYLOR

SCOTT GLOVER

SAAD NASEER, M.D.

CHERYL WATKINS-MOORE, M.D.

$195.6 MILLION IN INVESTMENT CAPITAL, GRANTS, AND REVENUE has been RAISED BY

BIOGENERATOR

portfolio companies

www.biogenerator.org

20 South Sarah Street

St. Louis, MO 63108

314.615.6355

[email protected]