Life Sciences on the TSX

Elaine EllinghamRegional Manager, B.C.Toronto Stock Exchange

TSX Group of Companies

TSX – TSX VentureCanada’s first National Exchange

VancouverVancouver

CalgaryCalgaryVenture head officeVenture head office

WinnipegWinnipeg TorontoTorontoTSX head officeTSX head office

MontrealMontreal

Benefits of TSX-TSX Venture Deal

Strengthens international competitiveness with the formation of a “national” market

Synergies in trading systems and technologies

Junior and senior markets maintained separate and distinct to best serve two distinct markets

Rules will become more “similar”

Improves pipeline between junior “incubator” and senior market (linked exchanges) – more streamlined graduation process for junior companies

Provides regional infrastructure for TSX service

What’s been happening to the Canadian Exchanges?

Realignment into one junior & one senior equities market

Demutualization – “for profit”

Separation of “Regulation Services Inc.”

Acquisition of CDNX by TSE

Rebranding to TSX and TSX Venture Exchange

$22.7

$32.0$29.7 $28.7

73 listed Life Sciences companies

13 or about 18% are B.C. based

$28.7 billion market capitalization as at end of Q1 2002

B.C. based account for $3.8 billion mkt cap or about 13%

TSX - Life Sciences Sector

1999 2000 2002Q12001

Aggregate Market Capitalization

$ Billions

62 cos 72 cos70 cos 73 cos

28

17

20

8

Life Sciences Sector on the TSX

0-50 50-150 >500150-500

Distribution by Market Capitalization

Number of Companies

$ Millions

2 4 25 B.C. based

225 231

1,1741,355

1,562

Equity Raised for TSX Life Sciences Companies

2000 2001

$ Millions

1997 1998 1999

• In the last 6 years, TSX life science companies completed 215 equity financings raising $5.4 billion

• 8 of these were over $100 million

• In the first month of 2002, two deals worth a total of $49.9 million

Index Changes

Elimination of TSE300, TSE200, TSE100 and TSE35

Removal from real time May 1, 2002

Discontinued May 1, 2003

Updating to reflect today’s market standards

S&P/TSE Composite Index replaced TSE300 index

No longer fixed at 300 companies

Move to GICS (Global Industry Classification Standards)

S&P/TSX Canadian Health Care Index

S&P/TSE Composite Index Criteria for Inclusion

Must be listed on TSE for 12 months (some discretion by index committee)

Price and minimum weighting criteria (all must be met)– Float QMV must be at least 0.05% of total float capitalization of index

– Minimum weighted average price must be at least $1 over past quarter

– Close price at least $1 at previous month-end

Liquidity criteria (must meet all three over the preceding 12 months):

– Trading volume, value and number of transactions must be at least 0.025% of sum of all eligible companies’ trading volume, value and transactions

– No more than 25 non-trading days

– Float turnover at least 0.25

Visibility through Index Inclusion

S&P/TSX Composite Index (277 companies)

Health Care Index

22 companies included

6 are B.C. based

43% of B.C. Life Sciences companies in the Index

Visibility through Analyst Coverage

48 life sciences analysts in Canada

100 analysts covered our TSX life sciences companies in 2001 resulting in 278 incidents of coverage

Our covered companies had an average of five analysts per company

Number of Research Analysts Covering TSX Life Science Companies

10

24

13

3 3

0

5

10

15

20

25

30

<2 2 to 5 5 to 10 10 to 20 >20

Number of Analysts

Nu

mb

er

of

Co

mp

an

ies

TSX Life Sciences CompaniesTrading & Equity Raised

Life Sciences Total TSX

Trading Value $19 b $713 b

Trading Volume 1 b 37 b

Equity Raised $ 1.6 b $ 21 b

Growth of Biotech on the TSX Trading Volume in the TSE 300

21

108 117 114170

589

721

0

100

200

300

400

500

600

700

800

1995 1996 1997 1998 1999 2000 2001

Vo

lum

e (M

illi

on

s o

f S

har

es)

…and by Value

$0.4$1.9 $2.3 $2.5

$6.2

$18.6

$16.6

0

2

4

6

8

10

12

14

16

18

20

1995 1996 1997 1998 1999 2000 2001

Val

ue

Tra

ded

($

Bil

lio

ns)

-40%

-30%

-20%

-10%

0%

10%

20%01

/02/

2001

02/0

2/20

01

03/0

2/20

01

04/0

2/20

01

05/0

2/20

01

06/0

2/20

01

07/0

2/20

01

08/0

2/20

01

09/0

2/20

01

10/0

2/20

01

11/0

2/20

01

12/0

2/20

01

01/0

2/20

02

02/0

2/20

02

03/0

2/20

02

04/0

2/20

02

05/0

2/20

02

S&P/ TSX Canadian Health Care Index Nasdaq Biotechnology Index

Comparison of Biotech Sector Performance TSX vs Nasdaq

Canadian Companies on Nasdaq

Source: Nasdaq

• 16 life sciences companies are interlisted on Nasdaq

Nasdaq-TSE interlisted

Nasdaq SCM only

Nasdaq National only

0

20

40

60

80

100

120

140

160

180

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 -March

Num

ber o

f Com

panie

s

Canadian Companies Going Public in the U.S.

1999 2000 2001 Aggregate Aggregate Aggregate

No. of IPO'sGross ProceedsNo. of IPO'sGross ProceedsNo. of IPO'sGross Proceeds

TSE - Nasdaq National 1 $75 million 6 $1.5 billion 1 $93 millionInterlisted IPO

Nasdaq National 3* $92.5 million 1** $90 million 0Only Listed IPO (2) ($50.5 million) (0) (0)

* Pivotal listed on TSE subsequently; ** Delano listed on TSE subsequently)

TSX Venture ExchangeLife Sciences Sector

BC (27)33%

Ontario (31)31%

Alberta (11)25%

Quebec (8)10%

Others (3)1%

• 80 Listed Life Sciences Companies• Aggregate market cap: $650 million

Number of companies shown in ( )

TSX Venture ExchangeBiotech Equity Financing 2001

Public Offerings ($29m)

28%

Private Placements

($63m)62%

IPO ($10m)10%

Total TSX Venture Biotech financing: $102 million

TSXInitiatives

Catalyst for a national securities regulatory solution

“Rule review” for ongoing transactions

Corporate Governance Joint Committee initiatives

Regional Managers enhance service to our listed companies and proactive approach to assisting prospective companies and their advisors in listing

To enhance liquidity: Introduction of broker anonymity Iceberg orders Review of Registered Trader program

TSX and TSX Venture Exchange Canada’s National Market

Elaine EllinghamRegional Manager, British ColumbiaToronto Stock Exchange

604.643.6549elaine.ellingham@tsx.ca