NOVARTIS

Albuferon®

In June 2006, we entered into an exclusive worldwide agreement with Novartis for the co-development and commercialization of Albuferon. Novartis is a global leader in the pharmaceutical industry and has demonstrated its commitment to leadership in infectious diseases. Albuferon is currently in Phase 3 trials to evaluate it in the treatment of chronic hepatitis C.

Under the agreement, HGS and Novartis will co-commercialize Albuferon in the United States, and will share clinical development costs, U.S. commercialization costs and U.S. profits equally. Novartis will be responsible for commercialization in the rest of the world and will pay us a royalty on those sales. We have primary responsibility for the bulk manufacture of Albuferon, and Novartis will have primary responsibility for commercial manufacturing of the finished drug product. Clinical development, commercial milestone and other payments to HGS could total as much as $507.5 million, including $132.5 million received to date.

GLAXOSMITHKLINE

LymphoStat-B®

In August 2006, we entered into an agreement with GSK for the co-development and commercialization of LymphoStat-B. GSK is a world leader that brings global pharmaceutical development and marketing capabilities to the LymphoStat-B program. LymphoStat-B is currently in Phase 3 trials to evaluate it in the treatment for systemic lupus erythematosus (SLE).

We and GSK will share equally in Phase 3 and 4 development costs, sales and marketing expenses, and profits associated with LymphoStat-B. Under the agreement, we have the right to book sales in the U.S. and GSK has the right to book sales outside the U.S. We are conducting Phase 3 clinical trials with assistance from GSK, and will have primary responsibility for bulk manufacturing.

HGS-ETR1 (mapatumumab)

In August 2005, GSK exercised its option under a 1996 agreement to develop and commercialize HGS-ETR1, our agonistic human monoclonal antibody to TRAIL receptor 1, jointly with HGS. Under the terms of the agreement, we and GSK will share equally in Phase 3/4 development costs, and will share equally in sales and marketing expenses and profits of any product that is commercialized under the agreement.

Darapladib

Darapladib, a small-molecule Lp-PLA2 inhibitor discovered by GSK based on HGS technology, is in Phase 2/3 development by GSK for the treatment of atherosclerosis. We will receive a 10% royalty on worldwide sales of darapladib if it is commercialized, and we have a 20% co-promotion option in North America and Europe, under which we would pay 20% of commercialization costs in exchange for 20% of darapladib profits. We are also entitled to receive a milestone payment if darapladib moves through clinical development into registration.

Syncria® (albiglutide)

In May 2007, GSK advanced Syncria to Phase 2b development for the treatment of type 2 diabetes. Syncria is an albumin-fusion protein created by HGS using our proprietary albumin-fusion technology. We licensed Syncria to GSK in October 2004, and are entitled to fees and milestone payments that could amount to as much as $183 million, some of which has already been received, in addition to royalties on worldwide sales if Syncria is commercialized.

GSK649868

GSK649868 is a small-molecule orexin antagonist, discovered by GSK based on our technology. GSK is investigating its potential use in the treatment of sleep disorders. We will receive a 10% royalty on worldwide sales of GSK649868 if it is commercialized, and we have a 20% co-promotion option in North America and Europe, under which we would pay 20% of commercialization costs in exchange for 20% of GSK49868 profits. We are also entitled to receive a milestone payment if GSK649868 moves through clinical development into registration.