Investor Presentation June 2013

Safe Harbor Statement

Certain C t i items it in i thi this presentation t ti and d other th matters tt di discussed dt today d or answers that th t may be given to questions asked could constitute forward-looking statements, including statements regarding the progress and timing of clinical trials, the safety and efficacy of our product candidates, our collaborators, and estimates of the potential markets for our product candidates. Additional risks and uncertainties are described more fully in Anacors Annual Report on Form 10-K for the year ended December 31, 2012 and subsequent quarterly reports filed on Form 10-Q filed with the Securities and Exchange Commission. These statements are subject to risks and uncertainties relating to Anacors future financial or business performance. Anacors actual results or achievements could differ materially from those anticipated in these forward-looking statements. Please note that Anacor is under no obligation to update any of the forward-looking statements y discussed today.

A Biopharmaceutical Company Developing Multiple Drug Candidates Using Novel and Proprietary Boron Chemistry

Anacor Pharmaceuticals Overview

Two Proprietary Compounds in Late Stage Clinical Development
Tavaborole - Topical Treatment for Onychomycosis
M Met t primary i and d secondary d endpoints d i t with ith statistical t ti ti l significance i ifi and db better tt efficacy ffi than th currently approved topical in two Phase 3 studies NDA filing expected mid-2013 Potential $1B market opportunity

AN2728 - Topical Treatment for Atopic Dermatitis and Psoriasis

Demonstrated safety and efficacy in 16 Phase 1 and Phase 2 clinical trials Expect to initiate Phase 3 studies in 4Q13 or 1Q14 Potential $600M market opportunity

Key Strategic Corporate Partnerships

2 candidates selected for development in animal health indications High single digit low double digit royalties on future sales ($350M - $500M potential market opportunity per candidate) Anti-infective R&D collaboration Over $75M paid to Anacor to date

Prolific Boron Chemistry Platform

8 novel small-molecule compounds have begun development in the last 7 years

4

Deep Pipeline of Proprietary Drug Candidates

UPCOMING MILESTONES

Anacor Owned
Tavaborole
(topical anti-fungal)

Phase 1

Phase 2

Phase 3

1H13

2H13

2014
Potential FDA Approval

Onychomycosis
Backup compound (AN2718)

Pre-NDA communications with FDA completed successfully File NDA mid 2013

AN2728

(topical anti antiinflammatory)

Atopic Dermatitis Psoriasis

3 Ph 2 studies completed Ph 3 ready Backup compound (AN2898)

Initiate Ph 2 safety/PK/efficacy study in children and TQT study

Initiate Ph 3 trial in atopic dermatitis in 4Q13 or 1Q14

AN3365

(gram-negative antibiotic)

Future development plans under review

Protocol concurrence

Partnered
Animal Health 1 Animal Health 2 AN5568 (HAT/Sleeping

Sickness)

Our Lead Program - Tavaborole

Target Product Profile: Safe and effective topical treatment for onychomycosis

Tavaborole b l

Onychomycosis a Highly Prevalent Fungal Infection Affecting 35M People in the US

} }

Fungal infection of the nail and nail bed

Without treatment, it can damage the nail unit and spread to other toes and skin

Affects 1 in 10 people
Affects 1 in 3 diabetics, increasing risk of secondary infections, foot disorders and limb amputations

Local, non life threatening infection - fundamentally ought to be t treated t dt topically i ll

Currently Approved Products Have Limitations

}

Oral treatments (Mostly Lamisil and Sporanox)

Safety concerns limit their use despite effectiveness
Liver toxicity, drug-drug interactions and unwanted side effects Sporanox received 2 black box warnings (CHF and drug interactions)

Topical treatment
Penlac

is the only approved topical and was approved with concomitant debridement
Safe but low efficacy due to inability to penetrate nail Inconvenient to apply

To cure onychomycosis onychomycosis, the optimal topical drug must be small small, water soluble and not bind to keratin to penetrate the nail and reach the Fungus resides in nail bed
nail and nail bed Nails thickness and construction of compact keratin matrix and water create barrier for most tt topically i ll applied li d agents

Topical drug must penetrate nail plate to treat fungus g in nail bed

Due to Limitations of Approved Products, Most Patients are Treated with Debridement

Untreated ~20 million people

} Unmotivated

to treat } Dont like treatment options } Uninformed

Debridement ~8-10 million people

} Visit

Oral Medication (primarily Lamisil) ~1-2 million people

} Most

55% Untreated

30% Debridement

podiatrists ~3 times per year for debridement (cutting, clipping, scraping or removing the nail) to improve appearance and comfort not cure the infection

} Does

effective treatment option concerns and unwanted t d side id effects ff t have limited the use of oral medication

10% Topical 5% Oral

} Safety

Topical Treatments (Penlac and OTC remedies) illi people l ~ 3 million

} Demonstrated

efficacy

little to no

Source: Estimated based on Podiatry Today, IMS, AC Nielsen, Medicare and Alpha Detail data
9

In Spite of Limitations, Currently Approved Products Had Combined Peak Sales Over $2B
Lamisil (terbinafine) Oral
~$1.2B peak WW sales Most effective but safety concerns 2010 NRx (a) Complete Cure (Mycological ( y g Cure + 100% clear nail) Mycological Cure (Negative Culture and Negative KOH) Price per course of treatment (prior to generic entry) 1.4M 38%

Sporanox (itraconazole) Oral

~$600M peak WW sales Low efficacy and safety concerns 23K 14%

Penlac (ciclopirox) Topical

~$300M peak WW sales Low efficacy and inconvenient 375K 5.5% - 8.5% (with debridement) 29% - 36%

70%

66%

$1,172 (3 months of treatment)

Liver toxicity Drug-drug interactions Diarrhea Rash Smell and taste disturbance

$2,050 (3 months of treatment)

2 Black Box Warnings Liver toxicity Drug-drug interactions Cardiac complications Rash GI disorders

$660 (b) (1 year of treatment)

<5% skin irritation

Potential Side Effects

Inconvenience/ Other Issues

Liver enzyme test at onset and 6 weeks patients may y be on multiple p other oral Older / diabetic p medications and dont want to or cant add an oral treatment for onychomycosis

Lacquer must be applied daily, y allowed to dry y and removed weekly Approved as adjunctive therapy to debridement

(a) Source: IMS. Includes generics. (b) AWP of branded Penlac increased to $3,616 per course of therapy as of 3/1/13
10

Our Solution for Onychomycosis

Safe
} } }

Effective
} } }

Local, targeted therapy Little or no detectable systemic exposure All preclinical toxicology completed

Potent against broad spectrum Baseline of fungi and yeast Unique MOA - targets LeuRS to kill fungus Demonstrated efficacy superior to Penlac in first Phase 3 study

Penetrates Nail
}

A safe and effective topical treatment for onychomycosis that is more effective than current topical options and safer than current oral therapeutics

Tavaborole

Easy to Use
Apply with dropper once daily Dries in about one minute No special cleansing or preparation prior to application

} } }

Small molecular weight 152 Da compared to > 300 Da for most antifungals Balanced preference for oil and water (logP = 1.24) 1 24) Water soluble (0.8 mg/mL) Activity in presence of keratin

} } }

11

Tavaborole Met All Endpoints With Statistical Significance In Two Phase 3 Trials
Studies included patients of all ages with no upper age limit and onychomycosis involving 20% - 60% of target great toenail
Study 301 (N = 594) (active / vehicle) Primary Endpoint p at 52 Weeks Completely clear nail and mycological cure (defined as negative ( g culture and negative g KOH) of target great toenail 6.5% / 0.5% (p=0.001) (p ) 26.1% / 9.3% (p<0.001) 31.1% 31 1% /7.2% /7 2% (p<0.001) 15.3% / 1.5% (p<0.001) 87.0% / 47 47.9% 9% (p<0.001) 24.6% / 5.7% (p<0.001) 2.8% / 1.6% Study 302 (N = 601) (active / vehicle) 9.1% / 1.5% (p<0.001) (p ) 27.5% / 14.6% (p<0.001) 35.9% 35 9% / 12 12.2% 2% (p<0.001) 17.9% / 3.9% (p<0.001) 85.4% / 51 51.2% 2% (p<0.001) 25.3% / 9.3% (p<0.001) 0.8% / 0.5%

Secondary Completely clear or almost clear (10% Endpoints at clinical involvement) target great toenail 52 Weeks Mycological M l i l cure of ft target t great t toenail t il Completely clear or almost clear nail + mycological cure Other Negative culture Completely clear or almost clear nail and negative culture Safety Rate of discontinuations as a result of adverse events

Overall safe and well-tolerated across study subjects No serious adverse events related to study drug
12

Clinical Photographs from Tavaborole Phase 3 Studies 26.1% and 27.5% of Patients Reached Completely Clear or Almost Clear Nails in Studies 301 and 302 Baseline
Completely Clear Nail With Mycological Cure

Week 52

Week 52 Baseline
Almost Clear Nail With Mycological Cure

13

Tavaborole Has Demonstrated Greater Efficacy and is More Convenient to Use than Penlac

Tavaborole Study 301 Adjunctive Treatment Required Dosing / Application None

Tavaborole Study 302

Penlac (1) (ciclopirox lacquer) Nail debridement, as often as monthly Lacquer painted on nail daily Weekly removal of Penlac with alcohol (Active / Vehicle) 6 5% / 0.9% 6.5% 0 9% (Study 312) 12.0% / 0.9% (Study 313) 29.0% / 11.0% (Study 312) 36.0% / 9.0% (Study 313) 5.5% / 1.0% (Study 312) 8.5% / 0.0% (Study 313) N/A

Solution applied once daily

Phase 3 Efficacy Results Completely clear or almost clear nail + mycological cure Mycological cure Completely clear nail and mycological cure Completely clear or almost clear nail

(Active / Vehicle) 15 3% / 1.5% 15.3% 1 5% 31.1% / 7.2% 6.5% / 0.5% 26.1% / 9.3

(Active / Vehicle) 17 9% / 3.9% 17.9% 3 9% 35.9% / 12.2% 9.1% / 1.5% 27.5% / 14.6%

(1) Penlac label 14

Tavaborole Could Represent an Important New Treatment Option for Onychomycosis Patients
}

Demonstrated efficacy and safety in two Phase 3 trials conducted under an SPA
No upper age limit on patients Onychomycosis involving 20% - 60% of target great toenail No debridement was allowed

Anacors conversations with p potential p prescribers indicate the following: g

Strong interest in a safe, novel, easy-to-use treatment with tavaboroles profile Although tavaborole Phase 3 trials did not include debridement, podiatrists expressed interest in using it with debridement Most important impo tant treatment t eatment goal for fo prescribers p esc ibe s and patients is clea clear or o almost clear clea nail

Potential competition from Valeants IDP-108

Difficult to compare Phase 3 results between IDP-108 and Anacor Known differences in inclusion criteria IDP-108 Phase 3 trials excluded patients over 70 and patients with more than 50% nail involvement Potential differences in trial methodology Recent CRL related to container closure apparatus will delay launch Anacors ongoing arbitration with Valeant could delay launch further
15

Tavaborole Packaging Designed for Convenience and Stability

Key Packaging Attributes Bottle packaged with screw top for optimal long-term drug stability Separate dropper allows for convenient application for patients and screws on tightly to preserve drug during use Tavaborole Bottle and Dropper

16

Upcoming Tavaborole Events

}

Tavaborole NDA on schedule to be filed with the FDA in mid-2013 In pre-NDA communications with FDA, Anacor achieved concurrence from the FDA on all major areas of focus for the NDA: Safety Efficacy Manufacturing Packaging

Phase 3 data to be presented in an oral presentation at the American Podiatric Medical Association Annual Meeting on July 22, 22 2013 Poster authors Lee Zane, MD Richard Ri h d Pollak, P ll k DPM Max Weisfeld, DPM

Final arbitration hearing with Valeant scheduled for September 2013

17

Arbitration with Valeant Pharmaceuticals

}

Background
In November 2012, Valeant published Phase 3 data for efinaconazole, a triazole antifungal developed for the topical treatment of onychomycosis

In October 2012, Anacor provided notice to Valeant Pharmaceuticals International, Inc. (successor in interest to Dow Pharmaceutical Sciences, Inc. (Dow)) seeking to commence arbitration of a breach of contract dispute under a master services agreement dated March 26, 26 2004 between Anacor and Dow related to certain development services provided by Dow in connection with our efforts to develop our onychomycosis nail-penetrating anti-fungal product We are seeking injunctive relief and damages of at least $215.0 million We have carefully reviewed our position and we believe that we have meritorious claims We currently estimate that the arbitration will conclude in the second half of 2013
Valeant agreed to postpone launch of efinaconazole until after final arbitration hearing in September 2013

} }

18

Our Lead Topical AntiAnti-inflammatory AN2728

Target Product Profile: Safe and effective topical l treatment f for atopic dermatitis and psoriasis

AN2728

19

Atopic Dermatitis is a Prevalent and Intensely Itchy Chronic Skin Condition

}

Large patient population

~40M in the developing world ~10% - 20% of infants and young children
70% of cases start before the age of 5 years Up to 50% may have recurrences as adults

Majority Majority of cases are mild mild-to-moderate to moderate

}

Chronic type of eczema characterized by flareups of itchy, inflamed skin

Predominantly P d i tl i in areas of f skin ki flexures fl and d face f Itch and discomfort can lead to restlessness and lack of sleep, impacting quality of life for patient and family Skin can be broken from scratching which can allow bacterial or viral access and lead to secondary infections

Due to prevalence among children, safety is an important feature of a treatment

20

Existing Therapies Lack Safety Needed for Treating a Disease that Primarily Affects Children
Topical Corticosteroids Topical Calcineurin Inhibitors (Protopic and Elidel)

Recommended Use Low potency steroids safe for 2nd line therapy when (by American children in short intervals continued use of topical Academy of High potency steroids should be steroids is ineffective or use of Dermatology) avoided in high risk areas such steroids is inadvisable as face or skin folds Advantages Di d Disadvantages Anti-inflammatory Fair to good efficacy

L Local l side id effects ff - skin ki Received R i d Bl Black kB Box warning i thinning, acne, stretch marks from FDA in 2005 Systemic side effects HPA Prior to Black Box warning, Axis suppression considered breakthrough ~72.5% 72.5% of parents worry about products due to perceived using them on children (1) safety relative to corticosteroids ~24% of parents admitted to not using them on children due to safety concerns (1)

(1) Charman CR, Morris AD, Williams HC. Br J Dermatol. 2000;142(5):931-6

21

Sales Ramp of Protopic and Elidel Demonstrates Demand for Safe Treatment Option
Protopic and Elidel Generated Over $500M in Sales Prior to FDA Black Box Warning in 2005
Protopic and Elidel WW Sales
($ in millions)

$600 $500 $400 $300 $200 $100 $0

2001 2002 2003 2004

Elidel

Protopic
Black Box Warning

2005

2006

2007

2008

2009

2010

Source: SEC filings and company reports

22

Our Solution for MildMild-toto-Moderate Atopic Dermatitis

Safe
} }

Effective
}

Topical application limits systemic y exposure p 16 clinical studies to date demonstrate a promising safety profile

Topical Anti-inflammatory for Atopic Dermatitis

AN2728

Target product profile Baseline efficacy equal to topical calcineurin inhibitors Three Phase 2 studies have demonstrated efficacy treating adults and adolescents with atopic dermatitis

Unique Mechanism of Action

} }

Boron-based compound Inhibits PDE4

Reduces production of proinflammatory cytokines thought to be associated with atopic dermatitis

23

Overview of AN2728 Phase 2 Studies in Atopic Dermatitis Completed to Date

(completed Dec. 2011)

AD-202

(completed Dec. 2012)

AD-203

(completed Mar. 2013)

AD-204

Objective

Human proof of concept in adults 25 adults with atopic dermatitis and 2 target lesions of similar severity

Safety, PK, and efficacy in adolescents 23 adolescents (12-17 years) with atopic dermatitis affecting 10% 35% BSA Whole body Open-label p Patients applied AN2728 ointment, 2% to all treatable areas of atopic dermatitis BID for 4 weeks

Dose-ranging study in adolescents 86 adolescents (12-17 years) with atopic dermatitis and 2 target lesions of similar severity Bilateral Double-blind Randomized 1:1 to treat lesions BID or QD Patients treated one lesion with AN2728, 2% and a comparable lesion with AN2728, 0.5% for 4 weeks ADSI assessed at 8,15, 8 15 22, and 29 days

Patients

Design

Bilateral Double-blind Randomized 1:1, active: vehicle Patients treated one lesion with AN2728, 2% and a comparable lesion with vehicle BID for 6 weeks ADSI assessed at 2,4 24 and 6 wks with primary endpoint at 4 wks

Outcomes

ISGA assessed weekly

24

2 Scales Used to Measure Severity of Atopic Dermatitis

ADSI (Atopic Dermatitis Severity Index) Used to assess severity of individual signs and d symptoms t of f atopic t i dermatitis d titi lesions l i 15 point scale (0-15) Sum of the severity scores of five clinical features rated from 0 (none) to 3 (severe) for each h feature, f t f for a t total t l score of f0t to 15
5 clinical features assessed:
} Erythema

ISGA (Investigator Static Global Assessment) Used to assess severity of all of the atopic d dermatitis titi on a patients ti t body b d 5 point scale (0-4)
Score 0 Grade Clear Definition Minor residual discoloration; no erythema or induration/ papulation; no oozing/ crusting

(redness) } Pruritus (itch) } Exudation (oozing/crusting) } Excoriation (evidence of scratching) } Lichenification (skin thickening)

Trace faint pink erythema, with barely perceptible induration/ Almost Clear papulation and no oozing/ crusting Mild Faint pink erythema with mild induration/papulation and no oozing/crusting Pink-red erythema with moderate induration/ papulation with or without oozing/ crusting Deep or bright red erythema with ith severe induration/ i d ti / papulation and with oozing/ crusting

Score 0 1 2 3

Grade None Mild Moderate Severe 4 Severe 3 Moderate

25

Study ADAD-204: AN2728 Ointment, 2% Applied BID Demonstrates Greatest Improvement from Baseline ADSI Score; Treatments Show Excellent Dose Response

26

Study ADAD-204: AN2728 Ointment, 2% Applied BID Demonstrates Greatest Improvement in the Individual Components of Atopic Dermatitis After 4 Weeks

27

Study ADAD-204: 62% of Lesions Treated with AN2728 Ointment, 2% BID Were Clear or Almost Clear After 4 Weeks

28

AN2728-ADAN2728AD-204 Results in Adolescents Compare Favorably to ADAD-202 Results in Adults at 4 Weeks AN2728 Ointment, 2% Dosed Twice Daily for 4 Weeks

29

Study ADAD-203: AN2728 Demonstrated Efficacy in Adolescents Using Anticipated Phase 3 Efficacy Measure
} }

Open-label study in adolescents with atopic dermatitis 10%-35% BSA 23 patients treated all atopic dermatitis lesions with AN2728 ointment, 2% BID for 4 weeks Investigator Static Global Assessment (ISGA) assessed weekly

Mean ISGA Scores at Weekly Visits N=23

3.0 25 2.5 2.4 1.8 1.5 1.3 1.4

Mean ISGA Scores

2.0 1.5 1.0 0.5 0.0 Baseline

ISGA Scale: 0 Clear 1 Almost Clear 2 Mild 3 Moderate 4 Severe

Day 8

Day 15

Day 22

Day 29

30

Study ADAD-203: Efficacy Compares Favorably to Elidel, an Established Atopic Dermatitis Therapy

Caution is needed when comparing AN2728s open-label Phase 2 data with randomized, controlled Phase 3 data for Elidel } Pivotal Pi t l Ph Phase 3 d data t f for Elid Elidel l categorized t i d outcomes t f for ISGA after 6 weeks of treatment versus the 4-week course of therapy in the AN2728-AD-203 study
}
Elidel / vehicle
(1)

Outcome Clear/Almost Clear Clear/Almost Clear ( ith 2-grade (with 2 d improvement) Clear

AN2728 (4 wk BID, BID n=23) 74% 35% 13%

(6 wk BID, n=267 / n=136) 35% / 18% N/A 10% / 4%

(1) Source: Elidel label

31

Study ADAD-202: AN2728 Demonstrated Safety and Efficacy in Human Proof of Concept Study in Adults with Atopic Dermatitis
} }

Bilateral study in adults with atopic dermatitis 35% BSA 25 patients treated target lesions with AN2728 ointment, 2% vs. vehicle, BID for 6 weeks Atopic Dermatitis Severity Index (ADSI) assessed at 2, 4, 6 weeks (Primary endpoint at 4 wks)
% of Lesions with Greater Improvement in ADSI than Vehicle at Day 28 (p=0.02) % Improvement in ADSI at Day 28 (p=0.01) % of Lesions Achieving g Total or Partial Clearance (ADSI 2) by Day 28 (p=0.0027)

70% 60% 50% 40% 30%

68%

66% 52% 39%

20% 20% 10% 0% AN2728 Vehicle

32

16%

AN2728 Has Demonstrated Safety in the Treatment of Adults and Adolescents with Atopic Dermatitis
Atopic dermatitis is commonly associated with allergies and sensitivity. Many atopic dermatitis patients are sensitive to contact with soaps, fragrances, etc. Therefore, a non-irritating drug is critical, but almost all clinical trials will show some application site reactions.
}

AD-202
No severe adverse events reported that were considered related to study drug

AD-203
Generally G ll safe f and d well-tolerated ll l d with i h most common AEs AE being b i application li i site i reactions i
No serious adverse events (SAEs); one discontinuation due to AE

Pharmacokinetic data:
Blood levels are generally low and proportional to body surface area treated Overall ll pharmacokinetics h k are similar l to those h seen in adults d l after f adjusting d f for percent b body d surface f area treated }

AD204
No serious adverse events and no discontinuations due to drug-related adverse events (AEs) 22 AEs in 86 subjects
Severity: 91% mild, 9% moderate, none severe Relatedness: 82% not related to study drug

4 subjects reported application site symptoms:

Transient mild itching or burning/stinging on first application, none reported thereafter

33

Conclusions and Next Steps

}

In three Phase 2 studies in atopic dermatitis, data for AN2728 Ointment, 2% dosed BID continue to support its target product profile p o for o the treatment a of o atopic a op dermatitis d a in the age ag groups g oup tested d to date Next steps in development:
2 additional safety studies prior to initiating Phase 3: MUSE (maximal use systemic exposure) study in ~30 children with atopic dermatitis to measure blood levels when AN2728 is applied under maximal use conditions TQT study - to assess the effects of AN2728 following multiple-dose administration on electrocardiograms (ECGs) in ~180 healthy volunteers Initiate Phase 3 program of AN2728 development in 4Q13 or 1Q14 Timing dependent upon completion of MUSE study Anticipate approximately 500 patients 2-17 years of age in each Phase 3 trial

34

Corporate Partnerships

35

Partnerships Explore Boron Chemistry in Animal Health and Antibiotics

Animal Health Partnership signed in August 2010

} } }

$3.5M upfront, minimum $6M and up to $12M in research funding Research for a variety of animal health applications ($20 billion market) First development candidate, selected in August 2011 and second development candidate selected in December 2012 - $1M milestone payment received for each

Lilly responsible for worldwide development and commercialization Significant development milestones $350M - $500M potential market opportunity per candidate with high single-digit to low-double digit royalties on sales

Anti-Infective Partnership signed in October 2007

}

Over $75M paid to Anacor to date including $12M upfront + $30M investment in Anacor

Option to license compounds at PoC; 6-year research term GSK Licensed AN3365 (also known as GSK 052) in July 2010 - $15M milestone payment received Expanded p work around bacterial LeuRS, , added program p g to fund Anacors TB research

Modified in September 2011 - $5M upfront payment

GSK announced return of rights to AN3365 to Anacor on October 5, 2012

36

Anacors Boron Chemistry Pipeline for Neglected Diseases

5Research 5Hit Hit-to to-Lead 5Lead

Op

5Preclinical P li i l 5Safety

5Phase

Parasitic Diseases
Af i African Sl Sleeping i Si Sickness k (HAT) Visceral Leishmaniasis Chagas disease Mala ia Lead Se Malaria Series ies Malaria (New Scaffolds)

SCYX7158 / AN5568

River Blindness (Macrofilariacide) River Blindness (Wolbachia)

African Animal Trypanosomiasis Cutaneous Leishmaniasis

Bacterial Diseases
Tuberculosis (TB) LeuRS TB (non-LeuRS) TB new targets

37

Summary Financial Information

38

Low COGS and Specialty Salesforce Costs Should Lead to Strong Operating Margins

Estimated Cost of Goods Sold (a)

Tavaborole AN2728 ~$40 per course of therapy (12 bottles) ~$6 - $12 per course of therapy (30g or 60g tube)

Estimated Salesforce Cost

# of Podiatrists # of Dermatologists Salesforce size to cover podiatrists and dermatologists Annual cost per salesperson Total annual salesforce cost ~10,000 ~15,000 60-120 60 120 $200K to $250K $12M to $30M

(a) Estimates based on costs as of June 2012

39

Financial Summary

($ in 000s)

March 31, 31 2013 Cash, cash equivalents and short-term investments (1) T t l assets Total t Notes payable Accumulated deficit Total stockholders equity Total shares outstanding (2) $ $ $ $ $ 32,376 37 378 37,378 23,516 (230 289) (230,289) (7,795) 40,494,466

(1) Excludes $5.0M proceeds from Gates equity investment and $21.4M net proceeds from follow-on public offering in April 2013. (2) As of May 3, 2013.
40

Thank you

41

Appendix AN2728 in Psoriasis

42

Psoriasis A Prevalent Disease with Few Novel Treatment Options

Psoriasis An Inflammatory Skin Disease

Large Population with Mild to Moderate Disease

80% Mild to Moderate Disease 20% Severe Disease

Most Psoriasis Patients Treated Topically

87% Topical treatment 13% Non-topical treatment only

100M Affected Worldwide 7.5M Affected in the U.S.

Source: Decision Resources

4 Million Topical Rx/year

43

Phase 3 Efficacy of Most Recently Approved Topical Psoriasis Drugs

Sorilux
Active ingredient: Calcipotriene (vitamin D analog) clear or almost t clear w 2+ grade impro with ovement in PGA clear or almost c clear wit th 2+ grade improv vement in PGA

Vectical
Active ingredient: Calcitriol (vitamin D)

30% 25% 20% 15% 10% 5% 0% 14% 7%

27%

30% 25% 20% 15% 10% 5% 0%

8 weeks of 1 therapy

23% 14%

21%

16%

7%

8 weeks1 of therapy

Active

Vehicle

Active

Vehicle

Active

Vehicle

Active

Vehicle

Taclonex Taclonex
Active ingredients: Betamethasone Dipropionate (high-potency steroid) & Calcipotriene (vitamin D analog) absent or very y mild with 2- grade improvem ment in IGA

50% 40% 30% 20% 10% 0% Taclonex

48%

26% 17% 8%

4 weeks of therapy

BetamethasoneDipropionate (Highpotencysteroid)

Calcipotriene (VitaminDanalog)

Vehicle

44

Our Solution for MildMild-toto-Moderate Psoriasis: AN2728 Topical Therapy

Efficacy
}

Boron-based compound Inhibits PDE4 Reduces production of TNF-a, IL-12, IL-23 Target product profile efficacy is equal to midpotency steroid Four Phase 2 trials have demonstrated this level of efficacy

Baseline

} }

Safety
} } }

Day 84

Topical application limits systemic exposure Potential for long duration of treatment Clinical trial results have shown a promising safety profile

45

Overview of AN2728 in Psoriasis

}

Target Product Profile

Safe and effective topical therapy for mild-to-moderate psoriasis affecting all areas of the body, body including sensitive skin Efficacy in the range of mid-potency steroids or Vitamin D analogs Safer than topical steroids and without the irritation of Vitamin D analogs

AN2728 has demonstrated efficacy in the range of mid-potency steroids and vitamin D analogs Results of Local Tolerability Study confirm potential to expand indication to patients with inverse psoriasis which involves the face, skin folds, recesses, and genitalia AN2728 is Phase 3 ready for the treatment of mild-to-moderate psoriasis

46

Phase 2b (Dose(Dose-ranging Study in Psoriasis) Clear Dose Response Over 12 Weeks of Treatment

47

Phase 2b (204 Study) Pilot Phase 3 in Psoriasis

}

Key objectives
Provide data to inform plans for anticipated Phase 3 trial design and End of Phase 2 meeting with FDA
Safety and tolerability with larger body surface area treated than previous Phase 2 trials Level of efficacy with subject to subject comparison, rather than bilateral Time to peak efficacy with whole body treatment

Not intended to demonstrate statistical differentiation of treatment from vehicle, but to inform a fully-powered pair of pivotal Phase 3 trials
}

Design
12 week, double-blind, subject-to-subject comparison 68 patients randomized 2:1 AN2728 Ointment, 2%, vs. Vehicle BID

Clinical evaluations
Safety, efficacy and duration of treatment under anticipated Phase 3 conditions
48

Phase 2b (204 Study) AN2728 Demonstrated Improvement Over Vehicle in Psoriasis at Each Recorded Timepoint
Proportion of Subjects Achieving Clear or Almost Clear with 2-Grade Improvement from Baseline (PGA scale)

17% 14%

49

Treatment with AN2728, 2% in MildMild-toto-Moderate Psoriasis Phase 2b (204 Study)

Day 1

Day 42

Day 84

50

Local Tolerability Trial Demonstrates Potential for Wider Use in Psoriasis

}

AN2728 Ointment, 2% was applied to sensitive areas BID for 21 days

Elbows and knees Groin, axillae, gluteal cleft, retroauricular areas Face / hairline

AN2728 Ointment, 2% appears to be safe and well-tolerated when applied to sensitive skin areas
Adverse events occurred at a low rate and were generally mild None of the treated anatomic areas appeared to be particularly sensitive to irritation by the study drug

Reduces R d risk i k of f treating t ti areas of f inverse i psoriasis i i in i Phase Ph 3, 3 increasing potential for non-restrictive psoriasis indication Increases probability of safe and well-tolerated treatment of areas typically affected by atopic dermatitis
51