From: Jeffrey Epstein [email protected]>

From: Jeffrey Epstein [email protected]> To: Tazia Smith Subject: Re: Biotech Sell-Off.... [I] Date: Tue, 25 Mar 2014 13:42:37 +0000 Inline-Images: unnamed; unnamed(1); unnamed(2); unnamed(3); unnamed(4); unnamed(5); unnamed(6); unnamed(7); unnamed(8); unnamed(9); unnamed(10); unnamed(I I); unnamed(I2) remind me tomorow remind On Tue, Mar 25, 2014 at 7:30 AM, Tazia Smith wrote: Classification: For internal use only Jeffrey - Biotech posted sharp declines. You are up $970,282 across your basket of names as of yesterday's (3/24) dose (detail below along with chart of Nasdaq Biotech Index and your holdings). Consider unwinding or hedging now and watching for entry point via total return swap or zero cost risk reversal as this negative momentum bottoms out. Note: Ariad an outlier (incrementally positive news on drug, Iclusig). The Financial Times features an article this morning suggesting that the sell-off in Biotech is a signal of a broader market peak. A letter from congressional representatives to Gilead questioning its plans to sell a hepatitis C drug (named Sovaldi) for $84,000 per dose has put the spotlight on Congress' concerns that the expense might saddle state Medicaid programs with steep costs. US is the only major health-care market remaining without any meaningful drug price controls — increased risk for the sector once the Congress gets involved, especially if focused primarily on pricing. Description Trade Date Quantity Last Price• Unit Cost Market Value Unrealized G/L SANGAMO BIOSCIENCES 05/2W2013 50,000.00 S 19.80 5 8.44 $ 990,000.00 $ 567,786.00 BIOGEN 02/14/2012 2,095.00 S 312.60 $ 119.55 5 654,897.00 $ 404,442.05 FOUNDATION MEDICINE 01/13/2014 25,000.00 $ 36.40 $ 27.51 910,000.00 $ 222,336.50 GILEAD SCIENCES INC 2/5/14,3/7/14 8,100.00 $ 72.13 $ 79.41 $ 584,253.00 $ (58,951.00) ARIAD PHARMACEUTICALS 2/14/12,1/24/13 16,535.00 $ 7.60 $ 17.60 $ 125,666.00 $ (165,331.40) Total Biotec 93,264,816.00 9 970,282.15 Nasdaq Biotech Index - lyr Price History EFTA01193516 ARIA US -'Lai 03/2512013 ID 30 INBI C 2499.44 -77.77 On 24 Mar C 2587.92 I- 2587.92 t 2434.16 Prey 2499.44 ActIonr• Wor97) Edit - 99 Ter" >1:01‘ Last Pnce g M Th Campare Ir ser isity. stey ID 3C 1M 6M YTD lY SY Max Daily • • + Track " Annotate 2. News 0, Zoom ■ Last Price 2499.44 T- High on 02/25/14 2854.26 -. Average 2155.07 Low on 03/25/13'1619.16 Line Chart minim Evert 0 .2800 .2600 GEE! . 2400 .2200 0-2000 .1800 . 1600 T ■ : vs•i lume ;2(isi,86 2 32:°4; 14 II Jun Sep Dec Mar 2013 2014 .0 Ariad - lyr Price History ARIA US 5 Market .11 Prey 7.60 Vol 171,991 99 Save As %Actions Line 03/25/2014 6M YT: lY Max Da-ty • + Track z Annotate 7.86 7 .88 K 15>l0 Editr 98 Table DI Comore Mov A. Min a C Securty/StuCy !_t! News 0, Zoom Line Chart NEW M Event O VoLore T ELast Price 7.60 4.20 T High on 09/10/13 22.52 . Average 12.8235 I Low on 10/31/13 2.20 -15 El • Volume 0.172M .10 - Ania Likeirelibodowt 100M SMAVG (1S) 11A28M Jun Sep Mar 2013 2014 Biogen - lyr Price History Last Price EFTA01193517 IBII6 US 5 Market `'-- 'rev 312.60 Vol 715 _314.75 315.50_ 1 x 1 r Wal 93 Save—As //WIti Last Price 9Q Actions - 9)) Edit • 93 Table ▪ Lire A o Comore ' Line Chart "SM m Event O Volume 1: .3: 1s, IV SY Max Daity • • It: Evc_• tt-C: ± Track i Annciate Ut News Zoom L-• Last Price 312.60 L T High on 03/18/14 351.94 -- Average 250.467 L 1 Low on 03/25/13 176.22 c• Volume 715 iz stievG ,(15), Ll.$06M Jun Sep Dec Mar 2013 2014 350 250 200 5M 1.806K Foundation Medical - lyr Price History FMI US $ Market _ P35.25 /38.78K 1 x 1 Prey 36.40 Vol 543 200 irgrOgir msgrefinr g iThirrin5Tir FMI US ui co/24/2on ID 3D 03P.S/20 IM OM Y7D Lam Price It Lines ri Line 19 _ Comore ,:. =MIMI Volume "SD SY Max Daily • • ' Evarity/Staiy Event O ArTiaCk Mnotate 'News -, Zoom *45 Last Price 36.40 - T High on 03/13/14 43.62 --0- Average 30.1647 I Low on 09/24/13 18.00 NI Volume 0.54311 ■ SMAVG (15) 0.26511 Sep Oct Nov Dec Jan Feb Mar 2013 I 2014 al . 40 -30 0- 25 •20 . 511 Gilead - lyr Price History EFTA01193518 GILD US S Market Va."— P72.64 /72.82K 1 x 1 SGMO US ui 03/25/2013 1D GILD US -iUi 33/33/II`la 11) 3D D4 Vol Prey 72.13 29,340 99 Save As 919 Actions caiis,vae dl YID Last Price IV SY max Calty 'Or Line PI I • Last Price 72.13 T High on 02/25/14 83.95 Average 64.4132 I Low on 03/25/13 44.98 97) Edit - 98 Tabtrer Line Chart Co—Pre Min 11.[Er l a te Secunty/Sorn "I Event VoIurne Track t Annotate = News , Zoom 85 c• ■ Volume 29340 SM~~i81S)tji X4.756 Jun Sep 2013 Dec Mar 2014 80 7S 65 60 55 50 45 • 14.75611 Sangamo - lyr Price History SGMO US $ S Market ti K19.85 /21.40Q 2 x 2 Prey 19.80 Vol 2 907 036 n save xtliglifrAttltrflrV'—‘nreSPIIIIPIX7517r ^ L Compare Mop. 4,:- 3D 1/I Y- ) 1Y SY Max Daily • e Sectrity/St.dy 4. Track c Annotate = News O, Zoom 03/B/2014 Last Price Line Chart m USD PI Volume I -0-• Last Price 19.80 T High on 03/19/14 23.86 Average 12.1209 Low on 06/26/13 7.31 E:, • Volume 2.907M L • SMAVG (15) 2.74I3M i4owitama irlowiair.....bakaWill ilitiaramarairshowcakapa s adaliAl Jun Sep 2013 Dec Mar 2014 0 24.00 22.00 Cl 18.00 16.00 14.00 12.00 10.00 8.00 10M Healthcare sector has outperformed S&P500 last 4 years and has been the best-performing sector YTD Improving R&D returns Ongoing efficiency gains due to various 'self-help' measures More supportive regulatory and payor environment Increasing number of financings and IPOs in Q1 Frequent upward revisions lately to sales estimates at the largest biotechnology companies Nasdaq Biotech Index (ISLB1)strstpped 4.4% Friday EFTA01193519 Sharpest decline since Oct-11 • Triggered by a letter from congressional representatives to a biotech company Gilead Sciences, questioning its plans to sell a hepatitis C drug (named Sovaldi) for $84,000 per dose Gilead required to give briefing by 03-Apr Sovaldi expected to generate >$4bn in sales this year The drug's expense might saddle state Medicaid programs with steep costs The whole sector is as risk US is the only major health-care market remaining without any meaningful drug price controls Risk for the whole sector once the Congress gets involved, especially if focused primarily on pricing The biggest NBI firms sold-off significantly 1d chg (%) Index Wt (%) BIOGEN IDEC INC -8.2 7.9 AMGEN INC -3.2 7.8 GILEAD SCIENCES INC -4.6 7.0 REGENERON PHARMACEUTICALS -5.4 6.9 CELGENE CORP -3.7 6.5 ALEXION PHARMACEUTICALS INC -8.0 4.6 ILLUMINA INC -5.4 4.6 MYLAN INC -0.9 4.3 VERTEX PHARMACEUTICALS INC -5.1 3.8 BIOMARIN PHARMACEUTICAL INC -5.9 2.5 Ways to hedge exposure to the US biotech sector • ProShares UltraShort Nasdaq Biotech Fund (BIS US Equity): designed to be 2x short the NBI • Options on iSharesNasdaq Biotech ETF (IBB US Equity) NBI — last 5 years 3000 2577.2_ 2000 1500 1000 500 2009 2010 2011 2012 2013 201• NBI Index (Nasdaq Biotechnology Index) CopyrightE 2014 Kocenberg Finance L.G. 23.4u-2014 14.35:20 NBI vs S&P500 — last 1 year EFTA01193520 Normalized As Of 03/23/2013 m• NBI Index - SPX Index 38.8807 Hi: 57.370A NBI — last 1 year Sep Oct Nov Dec Jan 2013 PIBI Wei (Nasdaq Biotechnology Index) Daily 23W2013-21WA2014 Feb Mar 2014 Oaprighl0 2014 Bloomberg Finance L.0. 2S77.21 2500 2400 2300 2200 2100 2000 23.iter-b314 14:35:52 KCP Capital Markets This e-mail may contain conklential and/or privileged information. If you are not the intended recipient (or have received this e-mail in arra) please notify the sender immediately and destroy this e-mai. My unauthorized copying, disclosure or distribution of the material ki this e-mail is strictly forbidden. Tazia Smith Director I Key dent Pa tiers - US Deutsche Bank Securities Inc Deutsche Asset & Wealth Management 345 Park Avenue. 26th Floor New York. NY 10154 Pereernit (This communication may contain confidential and/or privileged information. EFTA01193521 If you are not the intended recipient (or have received this communication in error) please notify the sender immediately and destroy this communication. Any unauthorized copying, disclosure or distribution of the material in this communication is strictly forbidden. Deutsche Bank does not render legal or tax advice, and the information contained in this communication should not be regarded as such. The information contained in this communication is confidential, may be attorney-client privileged, may constitute inside information, and is intended only for the use of the addressee. It is the property of Jeffrey Epstein Unauthorized use, disclosure or copying of this communication or any part thereof is strictly prohibited and may be unlawful. If you have received this communication in error, please notify us immediately by return e-mail or by e-mail to jeevacation®gmail.com, and destroy this communication and all copies thereof, including all attachments. copyright -all rights reserved EFTA01193522