TWST: Would you provide an overview of OraPharma, Incorporated.?

Mr. Kishbauch: OraPharma is a company whose goal is to become a leader in the research, development and marketing of products for oral health care, specifically pharmaceutically-oriented products. We are a company that focuses not only on dental/hard tissue pathologies, but on soft tissue pathologies such as oral mucositis as well. The company was formed in the middle of 1996, a little over three and a half years ago, as a spinoff from what was then American Cyanamid/Lederle and ultimately became American Home Products. American Home Products had developed a polymer-based form of drug delivery technology and a lead product for the treatment of periodontal disease, which had gone all the way through Phase II trials with very promising results. American Home Products chose to spin off that technology and license the technology together with the lead periodontal product based on that technology to an entity called OraPharma, as opposed to simply outlicensing to some other larger company. And so OraPharma was born in August of 1996, which was when the company was officially incorporated. Again, our AHP license gave us exclusive worldwide rights to this polymer drug delivery technology for use in the oral cavity, as well as a lead product focused on periodontal disease.

TWST: And briefly, what is periodontal disease exactly, and what's oral mucositis?

Mr. Kishbauch: Periodontal disease, the target of the company's lead product, is a disease that is actually bacterially mediated. It's a condition that is the single most prevalent chronic infectious disease on the face of the earth today, and it's caused by these structures we call bacterial plaque, which lay people tend to think of as rather dead, inert structures, but they are really, highly concentrated living bacterial colonies which, as they form in the spaces between the teeth and the gums, touch off an inflammatory tissue host response, which tends to break down tissue. And as that inflammation and breakdown process proceeds, it forms what we call a periodontal pocket in the space between the teeth and the gums, and as this pocket grows deeper, sooner or later it compromises some of the supporting structures of the teeth and ultimately becomes the leading cause of tooth loss in the adult population. Oral mucositis is a condition, which, in terms of our interests, is secondary to cancer chemo or radiation therapy. This is one of the most serious side effects of cancer therapy. It is a condition which results in very dramatic inflammation and frank tissue breakdown on the inside of the mouth, and can become so compromising at times as to not only limit the patient's nutritional intake, and therefore viability, but maybe more important than that, ultimately can limit the practitioner's willingness to administer additional chemotherapeutic agents, which obviously are needed to combat the cancer. It's a very serious side effect of cancer therapy.

TWST: Are both of these diseases on the rise, or are they decreasing?

Mr. Kishbauch: I think you will find that both of those conditions are on the rise. First of all, among the most important risk factors for periodontitis are smoking and aging. And with an aging population, this is a market that is probably destined to continue growing for a period of time. Mucositis, with more and more aggressive cancer treatments, is a condition that is likely to increase in prevalence, as practitioners become more aggressive about the basic treatment of the disease.

TWST: What do you consider to be the greatest opportunity for OraPharma over the next few years?

Mr. Kishbauch: Well, the most important opportunity for us is the successful commercialization of this lead product of ours, which we call MPTS, which stands for Minocycline Periodontal Therapeutic System (a brand name is right around the corner). This is a product which we believe is a best-of-breed product in the category. And given the number of patients that this product potentially accesses ' for perspective, there are 53 million Americans that are afflicted with periodontal disease at the moderate to severe level, and already something like 8 to 10 million, or 20% of that figure are under active treatment for their disease, largely mechanical treatment by practitioners. If we can access a relatively modest portion of that already-treated patient population, then we have a product with very significant volume potential. We think this represents the greatest opportunity for the company over the next few years. Furthermore, trend-wise, the segment in which we operate with our lead product is one that is moving rather dramatically from a history of mechanical intervention to one that includes medical therapy. Dentists have typically used instruments and procedures to combat diseases. And it's only relatively recently that they've moved from becoming mechanically oriented to more pharmaceutically oriented. And that's a trend that has been in place for the past few years, and we believe is accelerating right now, and represents a significant opportunity for a company like ours.

TWST: How will your R&D expenditures change in emphasis over the next few years?

Mr. Kishbauch: Well, our R&D expenditures for the near term will probably drop in comparison to what we have spent to complete a rather significant Phase III clinical trial protocol on MPTS. That is a trial that has not only been concluded; it has been unblinded with outstanding results; and has resulted in both the submission of an NDA, and the acceptance for review by the FDA of that NDA. And that's a process that's now winding down in terms of expenditures. Over the next couple of years, however, those expenditures will be replaced by expenditures for new R&D projects ' the two lead projects being the one for oral mucositis, as well as a project in the area of bone and tissue regeneration in the oral cavity. We also have a product for dental trauma, and a second generation periodontal product in development. So over the years 2001 and 2002, expenditures for that R&D program will approximate $9 and $18 million for those two years, respectively.

TWST: What would dental trauma be?

Mr. Kishbauch: Well, we have a project, in fact, in conjunction with the University of North Carolina at Chapel Hill, which is led by a leading endodontist, Dr. Martin Trope, which aims to forestall tooth loss due to full or partial trauma of a tooth. It turns out that there has been a significant amount of research done that shows the ability of antibiotic related preparations, when they are properly delivered and kept in place for a period of time, to take a tooth that has been partially or fully avulsed, i.e. knocked out, and be able to save that tooth. And that is an all too common issue, particularly with younger patients. There is an aging population. People are taking better care of their teeth these days. They're holding onto their teeth for a longer period of time, but that confers upon them an obligation to take more aggressive care of those teeth over a longer period of time, and that's where the treatment for periodontal disease plays such a key role into the future.

TWST: Do you consider any competition in your sector of the market? Is there any competition?

Mr. Kishbauch: Well, absolutely. In fact, within the past 18 months, there have been three new periodontal pharmaceuticals that have launched into the market. One is a product that was developed by Atrix Labs in Colorado. It's a product called Atridox, which is a gel-based polymer for releasing the antibiotic doxycycline into periodontal pockets. And that's a product that's marketed in this country by Block Drug. There's a second product which was developed by Perio Products Ltd. of Israel, and is marketed in this country by Astra, which is called PerioChip. This is a collagen-based chip which is impregnated with a solution of chlorhexadine, an antimicrobial, and is likewise inserted into the periodontal pocket. And finally, there's a systemic treatment, a pill treatment for periodontal disease called Periostat, which was developed and is marketed in this country by CollaGenex. It's a low-dose doxycycline product. These products are all competitors of OraPharma's, but I think we would argue that the PerioChip and the Atridox product, being locally delivered ' that is, delivered right into the periodontal product ' are more direct competitors of the MPTS product. The CollaGenex Periostat product is focused more on maintenance therapy, and many practitioners believe that the ideal combination of therapy is scaling and root planing, which is the mechanical treatment of removing this plaque that accumulates, in conjunction with a locally delivered product, such as ours, and then longer-term maintenance treatment with a systemic product like Periostat.

TWST: You certainly sound like you have a passion for this. Do you have a lot of background in dentistry?

Mr. Kishbauch: No, in fact, I've grown up in the pharmaceutical industry with pharmaceutical giants, like what was then Ciba-Geigy, and is now Novartis. And then after that, I spent two and a half years as President and COO of a company which has now become very successful in the biotech space, MedImmune. But dentistry is in fact, as a pharmaceutical discipline, relatively new to a lot of people in the field. And in fact, I would say that this is where the passion lies, because this is a branch of medicine that is changing as rapidly today as any branch of medicine on the landscape. Dentists are truly changing their habits, their behaviors. Patients are reorienting themselves towards dental treatment, and some of the systemic links between dentally and periodontally related conditions and more serious conditions like cardiovascular disease and diabetes. And frankly, that's a situation that has energized a lot of very high quality people to throw in with OraPharma, because we have an opportunity to be part of, and play a key role in steering this rather rapidly changing branch of medicine, and helping dentists, periodontists, and other oral care specialists move from being mechanically oriented, as previously, to being far more medically and pharmaceutically oriented in the future. So it's a nifty opportunity for us. It fills a real need for a profession that's changing rapidly. And in fact, historically, one of the greatest challenges in oral care medicine has been to find a way of delivering drugs into what is effectively a pretty hostile environment for drugs ' the oral cavity. That has required better drug delivery technology, which is in fact one of our core competencies. What we have licensed from American Home Products is a polymer-based drug delivery system that not only anchors drugs in periodontal spaces and related cavities, but will sustain their delivery over a period of anywhere from 14 to 30 days. And that is, in fact, how our MPTS product works. It is a product which is injected, as a dry hygroscopic powder, directly into periodontal pockets, where it anchors and then delivers the antibiotic minocycline, which has an unsurpassed profile for periodontal disease, over a period of at least 14 to 21 days, and possibly longer.

TWST: What do you see as the specific goals for OraPharma in terms of market position and growth over the next few years?

Mr. Kishbauch: Well first, over the next few years, we intend to achieve market leadership in the periodontal category among the group of products which we discussed earlier. We think that is a very achievable goal for us because we have a product that we believe is a superior product in terms of its ease of use, its efficacy and strength of clinical trial data, and its duration of action over time. Another goal that we have is to deliver at least two new R&D projects into human clinicals within the next 12 to 18 months. And in fact, two of those projects, notably the mucositis and regeneration projects, are both moving significantly ahead of schedule, and we believe we will reach that goal. And finally, in terms of ramp-up and profitability, the analysts who most closely follow OraPharma today expect that in 2002 this company will be achieving revenue in the range of about $60 million annually, and will achieve profitability by the end of that year.

TWST: Do you market your pharmaceuticals nationwide, worldwide?

Mr. Kishbauch: That's an excellent question that speaks directly to the company's business strategy. Remember, I opened the conversation saying that our goal as an organization is to be a leader in research development and marketing the pharmaceutical products for oral care medicine. Now when I say 'and marketing I'm describing ourselves as a fully integrated company. We do plan to participate in the commercialization of our products, especially in the US. And in fact, we've begun the process of building sales and marketing infrastructure to allow us to do that. We will take the primary responsibility for commercializing the MPTS product in the US by building a field force of 50 to 75 professionals. And that's a process that has already begun, and in fact, we will be ready to go with that field force no later than April 1 of next year. Now, outside the US there is a global market for oral care medicine, obviously. And in fact, most of the data we review tells us that the incidence of periodontal disease outside the US is probably even higher than the incidence inside the US due to a relatively lower standard of dental care. However, we believe that it's in the best interests of the company, and its investors and stakeholders, for us to be somewhat more careful about building infrastructure outside the US on a market-to-market basis. So it is likely that we will enlist at least one, or perhaps a few, key partnerships with major dental concerns on a market-by-market basis outside the US, and be somewhat more careful about building infrastructure throughout Europe, Asia, and South America.

TWST: What do you think about your stock price?

Mr. Kishbauch: Well, obviously, we think the world of our company and our prospects. We characterize ourselves as a bit of a throwback company, that we're more fundamentals based. That is, we're a company with a late stage-product and we believe that significant revenues and profitability, i.e., earnings per share, are within the relatively near- term grasp of this company. We worked hard to be ready for the IPO market when it opened up, and as a consequence, concluded a very successful offering on March 9th of this year. That offering has now given us the resources we need to make major progress against our goals. As you know, the market has lately been a little bit rocky, and investors a little cautious, particularly with early-stage companies. We think that over time, as the company continues to hit its milestones (and we've been very, very good about hitting milestones), by about the time we reach the approval and potential launch of the MPTS product, which we hope will be sometime next year, we will have built significant shareholder value.

TWST: What would be two or three reasons you would give potential long- term investors for investing in OraPharma?

Mr. Kishbauch: Well, whenever we present to interested constituencies, we try to leave them, if I can go one better than two or three, with four core messages of why we believe that we're a company that people ought to be interested in. Number one, we're a late-stage product company. We have a lead product which we believe is a best-of-breed product that addresses a potentially enormous market that is right around the corner. That is number one. Number two, the core polymer drug delivery technology on which that product is based, and on which future products are likely to be based as well, is a technology that directly addresses some of the historical challenges of delivering drugs directly into the oral cavity, and at the same time supports some very significant ease-of-use advantages on this lead product of ours. Number three, we have an advancing pipeline with at least two projects that are advancing ahead of schedule and which we expect to be in humans within the next 12 to 18 months. And number four, we have a very senior and experienced management team assembled on behalf of the company; in particular, with a very strong track record in the areas of both pharmaceutical product launches to include some very notable pharmaceuticals, and pharmaceutical drug development and clinical research. So those are the four reasons that we think make us a very fundamentally based company, and a very attractive target for investors.

TWST: Thank you. MICHAEL D. KISHBAUCH CEO and President OraPharma, Inc. 732 Louis Drive Warminster, PA 18974 (215) 956-2200 (215) 443-9531 - FAX

Each Chief Executive Officer who is the featured subject of a TWST Chief Executive Officer Interview is offered the opportunity to include an Investors Brief or other financial highlight material to be provided and sponsored by and for the company.

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