1114220--3/8/2006--KERYX_BIOPHARMACEUTICALS

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{property, intellectual, protect}

{acquisition, growth, future}

{stock, price, operating}

{financial, litigation, operation}

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{control, financial, internal}

{provision, law, control}

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Risks Related to Our Business We have a limited operating history and have incurred substantial operating losses since our inception. We expect to continue to incur losses in the future and may never become profitable. Risks Associated with Our Product Development Efforts If we are unable to successfully complete our clinical trial programs, or if such clinical trials take longer to complete than we project, our ability to execute our current business strategy will be adversely affected. If our drug candidates do not receive the necessary regulatory approvals, we will be unable to commercialize our drug candidates. Because all of our proprietary technologies are licensed to us by third parties, termination of these license agreements would prevent us from developing our drug candidates. We rely on third parties to manufacture our products. If these third parties do not successfully manufacture our products, our business will be harmed. If we are not able to obtain the raw materials required for the manufacture of our lead product candidate, , our ability to develop and market this product candidate will be substantially harmed. If we do not establish or maintain manufacturing, drug development and marketing arrangements with third parties, we may be unable to commercialize our products. Our reliance on third parties, such as clinical research organizations, or CROs, may result in delays in completing, or a failure to complete, clinical trials if they fail to perform under our agreements with them. Other Risks Related to Our Business If we are unable to develop adequate sales, marketing or distribution capabilities or enter into agreements with third parties to perform some of these functions, we will not be able to commercialize our products effectively. Even if we obtain FDA approval to market our drug products, if they fail to achieve market acceptance, we will never record meaningful revenues. If our competitors develop and market products that are less expensive, more effective or safer than our drug products, our commercial opportunities may be reduced or eliminated. If we lose our key personnel or are unable to attract and retain additional personnel, our operations could be disrupted and our business could be harmed. Any acquisitions we make may require a significant amount of our available cash and may not be scientifically or commercially successful. The status of reimbursement from third-party payors for newly approved health care drugs is uncertain and failure to obtain adequate reimbursement could limit our ability to generate revenue. Health care reform measures could adversely affect our business. We face product liability risks and may not be able to obtain adequate insurance. In connection with providing our clinical trial management and site recruitment services, we may be exposed to liability that could have a material adverse effect on our financial condition and results of operations. Our corporate compliance efforts cannot guarantee that we are in compliance with all potentially applicable regulations. Risks Related to Our Financial Condition Our current cash, cash equivalents and investment securities may not be adequate to support our operations for the next 24 months as we have estimated. If we are unable to obtain additional funds on terms favorable to us, or at all, our business would be harmed. Our prior restructurings may result in additional Israeli-related liabilities. Risks Related to Our Intellectual Property If we are unable to adequately protect our intellectual property, third parties may be able to use our intellectual property, which could adversely affect our ability to compete in the market. Litigation or third-party claims of intellectual property infringement could require us to spend substantial time and money defending such claims and adversely affect our ability to develop and commercialize our products. Risks Related to Our Common Stock Concentration of ownership of our common stock among our existing executive officers, directors and principal stockholders may prevent new investors from influencing significant corporate decisions. Future sales or other issuances of our common stock could depress the market for our common stock. Our stock price can be volatile, which increases the risk of litigation, and may result in a significant decline in the value of your investment. Certain anti-takeover provisions in our charter documents and Delaware law could make a third-party acquisition of us difficult. This could limit the price investors might be willing to pay in the future for our common stock.

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1114220--3/8/2006--KERYX_BIOPHARMACEUTICALS_INC