1012140--2/25/2009--ONYX_PHARMACEUTICALS

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{stock, price, operating}

{provision, law, control}

{property, intellectual, protect}

{control, financial, internal}

{acquisition, growth, future}

{condition, economic, financial}

{tax, income, asset}

{operation, international, foreign}

{personnel, key, retain}

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There are several existing approaches and several therapies in development for the treatment of liver cancer. If Nexavar is unable to successfully compete against existing and future therapies in liver cancer, our business would be harmed. Although Nexavar has been approved in the United States, the European Union and other territories for the treatment of patients with liver cancer, adoption may be slow or limited for a variety of reasons including the geographic distribution of the patient population, the current treatment paradigm for liver cancer patients, the underlying liver disease present in most liver cancer patients and limited reimbursement. If Nexavar is not broadly adopted for the treatment of liver cancer, our business would be harmed. If our ongoing and planned clinical trials fail to demonstrate that Nexavar is safe and effective or we are unable to obtain necessary regulatory approvals, we will be unable to expand the commercial market for Nexavar and our business may fail. We are dependent upon our collaborative relationship with Bayer to further develop, manufacture and commercialize Nexavar. There may be circumstances that delay or prevent Bayer s ability to develop, manufacture and commercialize Nexavar. We face intense competition and rapid technological change, and many of our competitors have substantially greater resources than we have. ONX 0801 may not be developed successfully, which would adversely affect our prospects for future revenue growth and our stock price. Our operating results are unpredictable and may fluctuate. If our operating results are below the expectations of securities analysts or investors, the trading price of our stock could decline. The market may not accept our products and pharmaceutical pricing and reimbursement pressures may reduce profitability. Our clinical trials could take longer to complete than we project or may not be completed at all. If serious adverse side effects are associated with Nexavar, approval for Nexavar could be revoked, sales of Nexavar could decline, and we may be unable to develop Nexavar as a treatment for other types of cancer. We are subject to extensive government regulation, which can be costly, time consuming and subject us to unanticipated delays. If we are unable to obtain or maintain regulatory approvals for our products, compounds or product candidates, we will not be able to market or further develop them. We are dependent on the efforts of Bayer to market and promote Nexavar. We are dependent on the efforts of and funding by Bayer for the development of Nexavar. We do not have the manufacturing expertise or capabilities for any current and future products and are dependent on others to fulfill our manufacturing needs, which could result in lost sales and the delay of clinical trials or regulatory approval. If Bayer s business strategy changes, it may adversely affect our collaborative relationship. We have a history of losses, and we may continue to incur losses. If we lose our key employees or are unable to attract or retain qualified personnel, our business could suffer. We may need additional funds, and our future access to capital is uncertain. If the specialty pharmacies and distributors that we and Bayer rely upon to sell Nexavar fail to perform, our business may be adversely affected. We or Bayer may not be able to protect our intellectual property, which gives us the power to exclude third parties from using Nexavar, or we may not be able to operate our business without infringing upon the intellectual property rights of others. Limited foreign intellectual property protection and compulsory licensing could limit our revenue opportunities. We may incur significant liability if it is determined that we are promoting the off-label use of drugs or are otherwise found in violation of federal and state regulations in the United States or elsewhere. We face product liability risks and may not be able to obtain adequate insurance. If we do not receive timely and accurate financial information from Bayer regarding the development and sale of Nexavar, we may be unable to accurately report our results of operations. Provisions in our collaboration agreement with Bayer may prevent or delay a change in control. Our stock price is volatile. Unstable market and economic conditions may have serious adverse consequences on our business. Existing stockholders have significant influence over us. A portion of our investment portfolio is invested in auction rate securities, and if auctions continue to fail for amounts we have invested, our investment will not be liquid. If the issuer of an auction rate security that we hold is unable to successfully close future auctions and their credit rating deteriorates, we may be required to adjust the carrying value of our investment through an impairment charge to earnings. We are at risk of securities class action litigation due to our expected stock price volatility. Our operating results could be adversely affected by product sales occurring outside the United States and fluctuations in the value of the United States dollar against foreign currencies. Provisions in Delaware law, our charter and executive change of control agreements we have entered into may prevent or delay a change of control.

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1012140--2/25/2009--ONYX_PHARMACEUTICALS_INC