Keith D. Ignotz CEO and President

2. Management Keith D. Ignotz, CEO and President 25 years experience as a senior medical company executive � 14 yrs in diabetes 8th company/division start up IPO and two company sales Dr. Jerry L. Nadler, Chairman Division Chief, University of Virginia Director, Center of Excellence in Diabetes 25 years R&D experience in causes and complications of diabetes Advisory Panel Member � Type 1 Diabetes funding, NIH-NIDDK Advisory Panel Member JDRF � new technology development and funding

4. DiaKine Therapeutics CDC says diabetes is at epidemic levels in the U.S. and growing globally $13 billion in potential market opportunities Proprietary compounds Imminent start to Phase 2 human islet transplant study Worldwide license provides 4 years in time savings, on R&D cost reduction and shortens time to market Extended pipeline includes oral immune modulators tested in primates Non-toxic in pharma screen

5. The Company Lead compound Lisofylline (LSF) was originally developed for cancer treatment with excellent safety profile Dr. Jerry Nadler of the University of Virginia researched anti-inflammatory properties of LSF and related compounds that could potentially cure the root cause of insulin-dependent diabetes Global license for diabetes and related complications from Cell Therapeutics (CTI) Investigational New Drug (IND) protocol in place 50 plus patents and applications Extensive portfolio of compounds for additional drugs Manufacturing data and drug substance Safety data � >600 patients tested

6. DiaKine Diabetes Universe Insulin-dependent diabetes is an autoimmune disease (like multiple sclerosis) caused when the body turns on itself and destroys its own islet cells 13 million Americans with diabetes Additional 16 million at risk 4.8 million Americans take insulin Insulin is life support not a cure About $135 billion spent on diabetes each year in America Diabetes kills 200,000 annually

7. Lisofylline

8. LSF media for islet cell transplants sales projected for 2007 � 80% gross margins Adjunct therapy to islet cell transplants Reverse/arrest progression of type1 and type 2 diabetes Treatment of diabetic complications Product Indications

9. Transplant Market Product Pre-transplant � LSF media improve functional yield of donor cells Post-transplant � LSF protects against rejection due to inflammatory cytokine response $150 million potential as procedure matures over the next 60 months Market transitioning from two organs per patient to four patients per organ

10. Islet Cell Media Revenue Projections

11. Type 1/LADA Market Arrest beta cell destruction/preserve beta cell mass Restore endogenous insulin production $3 billion annual market opportunity 30,000 new cases of Type 1 in U.S. each year 200,000 new cases of LADA in U.S. each year (10% up to 20% of all diabetics)

12. Follow-on Products Orals for insulin-dependent Type 2 and LADA - $2 billion potential market Diabetic complications Retinopathy 21% of newly diagnosed Type 2s have it 12,000 to 24,000 cases of blindness each year Kidney disease 20% of diabetics have kidney disease 43% of new cases due to diabetes

13. Product Development Status

14. R&D Allocations

15. Strategy Build operations incrementally as business and scientific milestones are met Establish fully integrated global product development operation R&D Contract manufacturing Marketing and sales through strategic partners Joint venture collaborations Plan to sell one or more business segments to strategic acquirer for dividend and reinvestment

16. DiaKine Summary Proprietary compounds $13 billion potential market opportunities Imminent start to NIH-funded Phase 2 islet transplant study with LSF License provides 4 year jump on R&D, leads to Phase 2 trial and quickens time to market Mining large library of compounds for new indications

17. DiaKine Financing $250,000 (estimated) in non-dilutive NIH support to prepare for use in clinical trial and islet cell transplant study Up to $1.5 million onset bridge convertible note underway Seeking $9.5 million A round Use of funds Conduct clinical trials, expand product pipeline and general corporate purposes