Analyst Conference Summary

conference date: August 4, 2009 @ 2:00 PM Pacific Time
for quarter ending: June 30, 2009 (2nd quarter 2009)

Forward-looking statements

Overview: Net income jumped on good increase in revenues.

Basic data (GAAP) :

Revenues from joint unconsolidated venture with Bayer were $60.2 million, up 12% sequentially from $53.7 million and up 33% from $45.1 million in the year-earlier quarter.

Net income was $9.4 million, up 129% sequentially from $4.1 million, and up 108% from $4.5 million year-earlier.

EPS (earnings per share) were $0.16, up 128% sequentially from $0.07, and up 100% from $0.08 year-earlier.

Guidance:

$850 to $875 million in Nexavar sales for 2009, but believes not likely to reach upper end of that range. R&D expense is likely to increase in the second half of the year.

Conference Highlights:

Believes Nexavar sales growth and promising pipeline show Onyx will become a major pharmaceutical company.

Global Nexavar (sorafenib) sales reported by Bayer were $201.0 million, up 19% from $168.5 million year-earlier. Believes growth can continue through geographic expansion and longer duration of treatment, plus beginning treatment earlier. 8% sequential growth in U.S. sales. In Europe expect strong continuing growth in liver cancer. In Asia, China was one of the leading contributors to Nexavar sales growth. Taiwan should get approval later this year. In Japan, following approval in May for liver cancer, Onyx will receive a 7% royalty on sales.

Non-GAAP net income reported as $15.3 million, up 76% from $8.7 million year earlier. EPS was $0.27.

"Statistically significant data recently reported from our large randomized Phase 2 breast cancer trial support our belief that Nexavar has the potential to become a standard of care across a variety of additional tumor types." Other Nexavar breast cancer trials continue.

Cash and equivalents ended at $469.5 million, increasing due to cash provided by operations.

Operating expenses of $51.5 million included $28.0 million for research and development and $23.5 million for selling, general, and administrative. Leaving income from operations of $8.7 million. Investment income was $1.0 million. Income tax provision was $0.3 million. Non-cash stock based compensation charges were $6.0 million.

Getting ready for, or initiating, Phase 2 and 3 trials in Nexavar for several types of cancer. Believes a significant investment in Nexavar is warranted to maximize long term sales.

Common stock and convertible notes to be sold to raise more cash [See Onyx Common Stock and Convertible Notes Press Release of August 4, 2009].

Q&A:

Discipline around acquisitions and development? We scour the globe for opportunities that complement our existing strengths. The new compounds we acquired last year were early stage, and so expenses are not high at this stage. We will use the same criteria going forward.

Expense guidance? Does include assumptions about milestone payments for ONX0801. We have options on the other compounds, but are not incurring an expense, unless we exercise the options.

Lung cancer? Together with Bayer we have a broad lung cancer program for Nexavar, both as monotherapy and in combination with chemotherapy. Tarceva and Nexavar combination is being evaluated.

Why raise more cash when you have lots of cash and are profitable? We continue to look at opportunities at every stage of the pipeline, not just a late stage opportunity. More or less said the money is indeed for business development, either developing a pipeline compound or acquire the rights to new compounds. Said would be disciplined in the use of the cash.

Nexavar pricing? We have been delivering Nexavar at a good price world wide. We want it available for the broadest set of patients in the U.S. We have programs in place in the U.S. for patients who need partial or full aid, but most patients have monthly co-pays of $50 or less.

Breast cancer? Believes 75% of the 1.3 million breast cancer patients are currently underserved and could become Nexavar patients. It is extraordinary to get results with this kind of statistical significance. It is a once in a lifetime opportunity.

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