Positive Top-Line Results Reported From the Phase 3 Trial of Zerenex in Japan

1. ®
First Take
Keryx Biopharmaceuticals Inc. (KERX)
Price: $1.53 (04/23/2012 - Intraday), Price Target: $3.00, Market Cap(MM):
$108.3, Rating: Market Outperform
Reni Benjamin, Ph.D., Senior Biotechnology Analyst 212-430-1743 rbenjamin@rodm.com
Positive Top-Line Results Reported From the Phase 3 Trial of Zerenex in Japan
Japan Tobacco (JT) Torii Reports Positive Data – Filing in 2013 Today, Keryx announced that the company’s Japanese
partner, Japan Tobacco (JT) Torii (TYO: 2914, Not Rated; TYO: 4551, Not Rated) reported positive top-line data from the
open-label randomized Phase 3 trial comparing Zerenex with Sevelamer Hydrochloride in 200 end-stage renal disease
(ESRD) patients on hemodialysis with hyperphosphatemia. The patients were treated with Zerenex for 12 weeks to
measure the primary endpoint of the change in the serum phosphorus levels. The top-line data reported that Zerenex
showed non-inferiority to Sevelamer. Based on the data, JT Torii is expected to file a marketing application in Japan by the
end of March 31, 2013. Recently, JT Torii initiated a Phase 3 program evaluating Zerenex in Japan for the treatment of
hyperphosphatemia, triggering a $5 MM milestone payment to Keryx. Recall, JT Torii is planning a broad Phase 3 program
comprising of 6 Phase 3 trials spanning up to 710 patients. The JT Torii licensing agreement calls for JT Torii to pay up to
$100 MM in up-front license fees and milestones to Keryx, of which $28 MM has been awarded to Keryx to date, as well as
royalty payments on net sales. Upon the Zerenex NDA submission in Japan, Keryx will receive a high single digit milestone
payment. In our opinion, the robust Phase 3 program being undertaken by JT Torii reflects a high degree of confidence that
Zerenex has significant potential to penetrate both the dialysis as well as the non-dialysis chronic kidney disease (CKD)
markets in Japan.
Phase 3 Zerenex Trial for Hyperphosphatemia to Report in 4Q12 Keryx is conducting a 58-week long-term, multicenter,
randomized, open-label, safety and efficacy Phase 3 trial evaluating Zerenex, a phosphate binder, in 440 patients with
ESRD on dialysis. During the recent call, management reiterated that the data from the Phase 3 trial is expected to be
available in 4Q12, with potential filing of the NDA and MAA in 1H13. In our opinion, the long-term study of Zerenex has a
higher than average likelihood to succeed given that the short-term Phase 3 trial of Zerenex in ESRD patients met its
primary endpoint of demonstrating a dose response in the change of serum phosphorous from baseline to day 28 (p-value
< 0.0001). Of additional significance, Zerenex may reveal additional benefits in combating anemia if the Phase 3 data
demonstrate a reduced need for intravenous and/or EPO blood cell stimulating drugs such as Procrit, Epogen and Aranesp.
Zerenex Market Potential We would like to remind investors that the US market for phosphate binders in the dialysis
setting is approximately $700 MM and the worldwide market is approximately $1.2 BN. The 25% year-over-year growth in
the phosphate binding market over the past 5 years has been driven by an increased incidence of dialysis with a growing
diabetic population, as well as price increases from the market leader Genzyme for Renagel and Renvela. We believe that
Zerenex has the potential to address multiple deficiencies among marketed phosphate binders, and capture 14% of the
market, corresponding to peak US revenues of approximately $250 MM by 2018, if successful.
Quick Take We are reiterating our Market Outperform / Speculative Risk rating and our target price of $3 based on a
discounted 2015 revenues and earnings multiples analysis. In our opinion, the positive top-line data from the Japanese trial
reinforces the potential of Zerenex franchise, and bodes well for the ongoing Phase 3 trial of Zerenex in the US. The
potential cost-savings benefit, combined with previous efficacy data, makes Zerenex an attractive treatment option in the
approximately $700 MM U.S. market for agents that lower phosphate in ESRD patients on dialysis. In our opinion, the
recent weakness in shares provides an opportunity for the value-oriented investor to participate in the upside of the Zerenex
franchise. We believe that Keryx represents a significantly undervalued and underappreciated company and is potentially
suitable for the risk-oriented investor.
For definitions and the distribution of analyst ratings, and other disclosures, please refer to pages 2 - 3 of this report.

2. Keryx Biopharmaceuticals Inc. April 23, 2012
RODMAN & RENSHAW RATING SYSTEM: Rodman & Renshaw employs a three tier rating system for evaluating both the potential
return and risk associated with owning common equity shares of rated firms. The expected return of any given equity is measured on a
RELATIVE basis of other companies in the same sector, as defined by First Call. The price objective is calculated to estimate the
potential movement in price a given equity could achieve given certain targets are met over a defined time horizon. Price objectives are
subject to exogenous factors including industry events and market volatility. The risk assessment evaluates the company specific risk and
accounts for the following factors, maturity of market, maturity of technology, maturity of firm, cash utilization, and valuation
considerations. Potential factors contributing to risk: relatively undefined market, new technologies, immature firm, high cash burn rates,
intrinsic value weighted toward future earnings or events.
RETURN ASSESSMENT
q
Market Outperform (Buy): The common stock of the company is expected to outperform a passive index comprised of all the
common stock of companies within the same sector, as defined by First Call.
q
Market Perform (Hold): The common stock of the company is expected to mimic the performance of a passive index comprised
of all the common stock of companies within the same sector, as defined by First Call.
q
Market Underperform (Sell): The common stock of the company is expected to underperform a passive index comprised of all
the common stock of companies within the same sector, as defined by First Call.
RISK ASSESSMENT
q
Speculative - The common stock risk level is significantly greater than market risk. The stock price of these equities is
exceptionally volatile.
q
Aggressive - The common stock risk level is materially higher than market level risk. The stock price is typically more volatile
than the general market.
q
Moderate - The common stock is moderately risky, or equivalent to stock market risk. The stock price volatility is typically in-line
with movements in the general market.
Rating and Price Target History for: Keryx Biopharmaceuticals Inc. (KERX) as of 04-20-2012
03/01/10 05/12/10 04/02/12
I:MO:$6 MO:$8 MO:$3
8
6
4
2
0
Q1 Q2 Q3 Q1 Q2 Q3 Q1 Q2 Q3 Q1 Q2
2010 2011 2012
Created by BlueMatrix
RATING SUMMARY
Distribution of Ratings Table
IB Serv./Past 12 Mos
Rating Count Percent Count Percent
Market Outperform(MO) 82 63.08% 12 14.63%
Market Perform(MP) 27 20.77% 3 11.11%
Market Underperform(MU) 6 4.62% 0 0.00%
Under Review(UR) 15 11.54% 4 26.67%
Total 130 100% 19 100%
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affiliates or subsidiaries within the past 12 months.
RODMAN & RENSHAW EQUITY RESEARCH 2

3. Keryx Biopharmaceuticals Inc. April 23, 2012
ADDITIONAL DISCLOSURES
Rodman & Renshaw, LLC. (the "Firm") is a member of FINRA and SIPC and a registered U.S. Broker-Dealer.
ANALYST CERTIFICATION
I, Reni Benjamin, Ph.D., hereby certify that the views expressed in this research report accurately reflect my personal views about the
subject company(ies) and its (their) securities.
None of the research analysts or the research analyst's household has a financial interest in the securities of Keryx Biopharmaceuticals
Inc. (including, without limitation, any option, right, warrant, future, long or short position).
As of Mar 31 2012 neither the Firm nor its affiliates beneficially own 1% or more of any class of common equity securities of Keryx
Biopharmaceuticals Inc..
Neither the research analyst nor the Firm has any material conflict of interest with Keryx Biopharmaceuticals Inc., of which the research
analyst knows or has reason to know at the time of publication of this research report.
The research analyst principally responsible for preparation of the report does not receive compensation that is based upon any specific
investment banking services or transaction but is compensated based on factors including total revenue and profitability of the Firm, a
substantial portion of which is derived from investment banking services.
The Firm or its affiliates have received compensation from Keryx Biopharmaceuticals Inc. for investment banking services within twelve
months before, and intends to seek compensation from the companies mentioned in this report for investment banking services within
three months, following publication of the research report.
Neither the research analyst nor any member of the research analyst's household nor the Firm serves as an officer, director or advisory
board member of Keryx Biopharmaceuticals Inc..
The Firm does make a market in Keryx Biopharmaceuticals Inc. securities as of the date of this research report.
Any opinions expressed herein are statements of our judgment as of the date of publication and are subject to change without notice.
Reproduction without written permission is prohibited. The intraday prices of securities mentioned in this report are as of Apr 23 2012.
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the solicitation of an offer to buy. The information contained herein is based on sources which we believe to be reliable but is not
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performance is no guarantee of future results.
RODMAN & RENSHAW EQUITY RESEARCH 3