01 234 5 ! Page 2 Page 3 Page 4

3 downloads 0 Views 4MB Size Report
Ever new successful clinical drug trials have been done for half a century. But who. Nnows how many, above all, which patients were treated to their advantage, .... and spinal cord perfusion to such a degree as to cause a noxious degree of ... How far more tolerable internal jugular vein stenoses may affect the brain is not.
                                                                                            !      

              " ! !               #          !                  $   

   %                        &&'   

 

(   )  !* + ! ,   -./01 234 5     

           !       

 

     

       

             

 

            

       

!" !#$%&! ' "(  

         

                                                                                                                                  ! !"#$%          #

" &  !   ' &     (  )*"  &

# # *)+,-"  

  

     ./0&    . 1,)2    #

 "  &   !    ' &    ( 

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¶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



ϭ







Ϯ

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

ϯ

 )URPDVVXPSWLRQVWRFRQYHQWLRQV D 7DXJKWQRQSHUIRUPDQFH E 1HXURORJLFDOERUERU\JPL ERZHOVRXQGV    7DNLQJVWRFN:KDW VWKHPRUDOWRWKHVWRU\" D 7KHQHXURORJLVW¶VTXDQGDU\ E /RZSUHVVXUHYHLQVLQMXUHEUDLQV"   3URVSHFWLQJD6\VLSKRVRU2G\VVHXV" D :KRPWRFDOOLQIRUQHXWUDODUELWUDWLRQ" E +RZWRUHERRW06UHVHDUFK"  5HIHUHQFHV /HJHQGV 





ϰ

 5HTXLUHGILUVW7DQJLEOHWRSLFV   7KH06SDWLHQWVXIIHUVIURPDSX]]OLQJIRUPRIEUDLQGDPDJHVZKLFK05,VPDJQHWLF UHVRQDQFHLPDJHV DOORZEHLQJFOHDUO\SHUFHLYHGDQGSUHFLVHO\LGHQWLILHG :LWKVHULDO 05,VWKHZD\VDQGPDQQHURIOHVLRQVSUHDGFDQEHIROORZHGDVZHOO  7KH FOLQLFDOO\ GHILQHG 06 DUH XQH[SODLQHG QHXURORJLFDO G\VIXQFWLRQV ZKLFK PDQLIHVWIRUGHILQLWHWLPHV  7KHWLPHVZHUHFRQYHQHGRQE\WHQQHXURORJLVWV7KHG\VIXQFWLRQVSRLQWWRQHUYRXV URXWHV WKDW DUH VRPHKRZ DIIHFWHG  ZLWKRXW WHOOLQJ DQ\WKLQJ DERXW WKH DIIHFWLRQ¶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

ϱ

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

ϲ

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

ϳ

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

ϴ

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

ϵ

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

ϭϬ

7KH ILYH OHWWHU DFURQ\P &&69, VKRRN WKH ZRUOG RI FOLQLFDO 06 UHVHDUFK WR LWV IRXQGDWLRQV ,W HQKDQFHG DW WKH YHU\ OHDVW WKH QHXURORJLVWV  QDWXUDO WHQGHQF\ WR UHFDOO RQH V GLDJQRVWLF HUURUV DQG UHPLQGHGWKHP RIWKH QHHG IRU UHOLDEOH FULWHULD >IRU PDNLQJ WKH06GLDJQRVLV@LQWKHDEVHQFHRIWKH >QHXURORJLVW¶V@+RO\*UDLODVHQVLWLYHDQG VSHFLILFGLDJQRVWLF>06ILQGLQJRU@WHVW *DIVRQ$HWDO    'HSORUDEO\  VRPH QHXURORJLVWV PD\ UHJDUG LW DV OXFN  WKH UHDVRQV IRU WKH &&69, LQWHUYHQWLRQVXFFHVVHV DSSHDUHGHOXVLYHDVZHOO   F 7KHFOLQLFDO06$SK\VLFDOYRLG  6SHDNLQJRIPXOWLSOHVFOHURVLV06DVDQHXURORJLFDOLOOQHVVKDVDORQJWUDGLWLRQ  (VWDEOLVKHGE\ZD\ RIXQFKHFNHGFOLQLFDOGLDJQRVHVWKHFRQGLWLRQLVVRPHWKLQJWKH QHXURORJLVWIHHOVDORQHDEOHWRXQGHUVWDQGWRKDYHDQH[FOXVLYHULJKWWRGHDOZLWK  1RWQHFHVVDULO\DMRNH06KDVEHHQVDLGWREHWKHQHXURORJLVW¶VGDLO\EUHDG  7KHQHXURORJLVWGHULYHVKLVLGHDRIDSUHVHQFHRIWKHGLVRUGHUIURPWKHFRXUVHRIWKH SDWLHQW V SURVSHFWLYHO\SURJUHVVLYHQHXURORJLFDOLQFDSDFLWDWLRQV  7KHSDWLHQW¶VWHVWLPRQ\WKDWWKHVHG\VIXQFWLRQVGLGSHUVLVWDQGDVDUXOHDOVRSDXVH IRU FHUWDLQ SHULRGV RI WLPH SOXV RQH QHXURORJLFDO H[DPLQDWLRQ WKDW FRQILUPV WKH SUHVHQFH RI PXOWLSOH QHXURORJLFDO G\VIXQFWLRQV VXƥFH VLQFH  IRU PDNLQJ WKH GLDJQRVLV06GHILQLWH  7KH VDLG 06 VSHFLILFDWLRQ DSSOLHV KRZHYHU RQO\ LI WKHUH DFFUXH QR SLHFHV RI HYLGHQFHZKLFKH[SODLQWKH SDWLHQW¶VQHXURORJLFDOGHILFLWVLQDEHWWHUZD\LHE\ WKHPVHOYHV  $Q06GLDJQRVLVSULPDULO\DQGXOWLPDWHO\SULQFLSDOO\HVVHQWLDOO\GHILQLWLYHO\DQG XQH[FHSWLRQDOO\ GHPDQGV 7KH QDWXUH DQG FDXVH RI WKH SDWLHQW V QHXURORJLFDO G\VIXQFWLRQV PXVW QRW EH LGHQWLILDEOHDQGQHYHUWREHLGHQWLILHG  

ϭϭ

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ƥFLHQF\ UHIOX[ HQKDQFHV WKH YHQRXVRXWIORZ RUZK\GHILQLWHPLQLPXPWLPHVRIUHIOX[GXUDWLRQZHUHVWLSXODWHG (YHQ OHVV ZK\ DOO &&69, ILQGLQJV ZHUH WDNHQ WR VSHDN IRU D UHGXFHG FHUHEUDO SHUIXVLRQRUZK\WKH VXSSRVHGO\UHGXFHGFHUHEUDODQGVSLQDOEORRGFLUFXODWLRQFDPH WREHUHJDUGHGDVDIDFWRUWKDW FRQWULEXWHGWRWKHHPHUJHQFHUHVSHFWLYHO\SURJUHVVLRQ RIDQ06  6WULFWO\ VSHDNLQJ RQO\ WKH WKLUG WR ILIWK &&69, FULWHULRQ PLJKW KDYH EHHQ WDNHQ WR PRUHRUOHVVWHVWLI\WRDFHUHEUDOYHQRXVLQVXƥFLHQF\ 

ϭϮ

 $VIRUWKHUROHRIWKHULJKWDQGOHIWLQWHUQDOMXJXODUYHLQVWKHIDFWWKDWHDFKRIWKHP FDQGUDLQWKHEUDLQWR EHWZHHQ]HURDQGDKXQGUHGSHUFHQW 6FKHOOLQJ))LJ SDJH ZDVQRWHYHQPDGHPHQWLRQRI  7KHSRWHQWLDORIFRPSXWDWLRQDOKHPRG\QDPLFVWRSURYLGHXQGHUVXFKFRQGLWLRQVIDU PRUH SUHFLVH HVWLPDWHV RI WKH FHUHEUDO YHQRXV RXWIORZ UHVLVWDQFH UHVSHFWLYHO\ RI LWV FKDQQHOV IORZFRQGXFWLYLW\ZDV VWUDQJHO\HQRXJKQRWWDNHQDGYDQWDJHRI  7KHRFFDVLRQDOPRUHRUOHVVWKRURXJKJRLQJVHSDUDWLRQEHWZHHQWKHYHQRXVWHUULWRULHV RI WKH ULJKW DQG OHIW LQWHUQDO MXJXODU YHLQ ZDV QRW WDNHQ LQWR DFFRXQW  QRW HYHQ LQ FRQVLGHULQJWKHHIIHFWVRIXQLODWHUDOMXJXODUUHIOX[  7KHSRVVLELOLW\RIELODWHUDOMXJXODUUHIOX[ZDVQRZKHUHDGGUHVVHG  ,Q DGGUHVVLQJ WKH SUREOHP YHQRXV UHIOX[ IURP RU YLD WKH LQWHUQDO MXJXODU YHLQV WKH GLUHFWYHLQHIIHFWVRQ WKHEUDLQDQGWKHLQGLUHFWHIIHFWVRIPDVVLYHLQWUDFUDQLDOYHQRXV GLVSODFHPHQWVDQGWKHUHVXOWDQW FHUHEURVSLQDOEXONVKLIWVIDLOHGWREHGLVFULPLQDWHG  ,QWKLVUHVSHFWHPHUJHGDSDUWLFXODUO\EL]DUUHDVSHFWRIWKHLQYHVWLJDWLRQVIRUD&&69, LQDSDWLHQWZLWK06  1R &&69, FULWHULRQ QRW HYHQ MXJXODU DQG FHUHEUDO YHQRXV UHIOX[ ZHUH VHHQ LQ FRQWH[W ZLWK WKH 06 SDWLHQWV¶ VHH FHQWUDO YHLQ VLJQ  GLUHFWO\ YHLQ GHSHQGHQW FHUHEUDOOHVLRQIRUPDWLRQV  7KH06SDWLHQWV VSLQDOFRUGILQGLQJVZHUHQRWVSRNHQDERXW  7U\LQJ WR DQVZHU WKH TXHVWLRQ RI KRZ D &&69, DIIHFWV WKH EUDLQ RU VSLQDO FRUG SUHVHQWVWKXVDWILUVW VLJKWDVDKRSHOHVVHQGHDYRU  0DNLQJ VXFK DQ DWWHPSW REYLRXVO\ QHFHVVLWDWHV RQH¶V GHOYLQJ PRUH GHHSO\ LQWR WKH KLVWRU\RI06  



ϭϯ

 06UHVHDUFKVHYHUHGIURPURRWV"  *DIVRQ VDQGKLVFRZRUNHUV¶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

ϭϰ

7KHSUREOHPVZLWKXQGHUVWDQGLQJWKHZRUGOHVLRQDUHV\PSWRPDWLFRIDJDSWKDWKDV XQDZDUHVRSHQHGXSEHWZHHQWKHQHXURORJLVW¶VDQGWKHSDWKRORJLVW¶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

ϭϱ

7KHUH VHHPV WR EH MXVW RQH SRLQW XSRQ ZKLFK DW OHDVW LQLWLDOO\ HYHU\RQH DJUHHG $ IDFWZKLFKFRXOGQRW DQGKDVQHYHUEHHQYDOLGO\FDOOHGLQWRTXHVWLRQ  ,WLVWKLVSODLQFLUFXPVWDQFH ,W ZDV DQDWRPLFDO SDWKRORJLVWV ZKR GLVFRYHUHG ZKR ILUVW SURYHG WKDW WKHUH H[LVWHGDQ06  7KH FHQWHQDU\ DQG RQHDQGDKDOI FHQWHQDU\ RI WKH ILUVW SUHVHQWDWLRQ RI DQ 06 VSHFLPHQZHUHZRUWKLO\ DQGDFFXUDWHO\FHOHEUDWHG 6LU 5REHUW &DUVZHOO V IDPHG 06 LOOXVWUDWLRQ &DUVZHOO 5   KDV WKHUHE\ EHHQ FRQVLVWHQWO\UHSURGXFHG 3ODWHL 

3ODWHL   

ϭϲ



-HDQ&UXYHLOKLHU¶VVKRUWO\VXFFHHGLQJGHSLFWLRQVRIWZR06VSHFLPHQV &UXYHLOKLHU-   PLUURUHG &DUVZHOO¶V OHVLRQ LOOXVWUDWLRQV WR D UHPDUNDEOH GHJUHH  DFWXDOO\ LQ HYHU\UHOHYDQWGHWDLO 3ODWHLL 

3ODWHLL



 1HLWKHU &DUVZHOO QRU &UXYHLOKLHU KRZHYHU WROG IRU ZKLFK UHDVRQ WKHLU VSHFLPHQV DQG DQ\ RI WKHLU VSLQDO FRUG VHFWLRQV KDG EHHQ VHOHFWHG QRU LQ ZKLFK UHJDUG WKH JLYHQILQGLQJVZHUHFRQVLGHUHGSHFXOLDU  7KHNLQGRUIRUPRISDWKRORJ\ZKLFKWKHILUVWWKUHH06OLWKRJUDSKVLOOXVWUDWHGZRXOG 

ϭϳ

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¶V GLDJQRVWLF DUPDPHQWDULXPGRHVQRWHQDEOHWRKHURUKLVGLVFULPLQDWLRQRIGLIIHUHQWO\ FRQILJXUHGOHVLRQIRUPDWLRQV  7KLV IDFW ZDUQV IURP WKH RXWVHW DJDLQVW D WRR KHDY\ UHOLDQFH RQ WKH ZD\V LQ ZKLFK FOLQLFDOQHXURORJ\KDVFRPHWRVHHDQGLQWHUSUHW06  



ϭϴ

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¶V@SK\VLFDOH[DPLQDWLRQ *HEDUVNL66   7KHREMHFWLRQVDJDLQVWWKLVDXGDFLRXVSURFODPDWLRQDSSHDUHGQHJOLJLEOH  7KH XQHDVH D IHZ VHDVRQHG SDWKRORJLVWV H[SUHVVHG UHJDUGLQJ WKLV WHUPLQRORJLFDO VZLWFK VHHPV QRW WR KDYH EHHQ VKDUHG HYHQ E\ D VXEVWDQWLDO PLQRULW\ RI 06 UHVHDUFKHUV  /LWWOH ZRQGHU 7KH ILUVW FOLQLFDO 06 GLDJQRVHV KDG EHHQ FHOHEUDWHG D KXQGUHG \HDUV EHIRUH  



ϭϵ

F +XVKHGXSDFOLQLFRSDWKRORJLFDOGLYRUFH  2UGHQVWHLQ¶VWKHVLVRILQWURGXFHG06DVDGLVWLQFWIRUPRIEUDLQDQGVSLQDOFRUG SDWKRORJ\ ,WVILUVWVHQWHQFHHYHQGHFODUHGLWDEVXUGWRORRNIRUDSULQFLSDOSDUDOOHOEHWZHHQWKLV NLQGRISDWKRORJ\DQGDQ\GHILQLWHQHUYRXVG\VIXQFWLRQ  7KHFHQWUDOPHVVDJHRI2UGHQVWHLQ¶VZRUNKRZHYHUVWRRGLQDEROGFRQWUDVWWRZKDW KDGEHHQVDLGEHIRUH +HUHLWZDVSRVLWHG 7KH QHXURORJLFDO PDQLIHVWDWLRQV RI 06 DUH H[SOLFLW HQRXJK  WR SHUPLW WKH FRQGLWLRQ¶VUHOLDEOHLQ YLYR LGHQWLILFDWLRQ  7KHVLV PDVWHU &KDUFRW ZDV VKRZQ WR SXEOLFO\ SUHVHQW WZR OLYLQJ SHUVRQV GLDJQRVHG ZLWK06IRUWKHILUVW WLPH  7KHQHXURORJLFDOSKHQRPHQDZKLFKKHOLVWHGIRULGHQWLI\LQJ06ZHUHRULJLQDOO\ILYH 7KH NH\ SLHFH RI HYLGHQFH ZDV $ SDWKRJQRPRQLF WUHPEOLQJ FKDUDFWHUL]HG E\ LWV HPHUJHQFHGXULQJ SK\VLFDOHIIRUWVDQGE\LWVFHVVDWLRQDWUHVW 2UGHQVWHLQ/   2I WKH 06 ILQGLQJV ZKLFK 2UGHQVWHLQ QDPHG WKLV DQG WZR IXUWKHU ZRXOG EH PHPRUL]HGE\JHQHUDWLRQVRIQHXURORJLVWVDV&KDUFRW¶VWULDGIRUGLDJQRVLQJ06  1RQHRIWKHFOLQLFDOILQGLQJVZKLFK&KDUFRWRUDIWHUKLPRWKHUQHXURORJLVWVSURSRVHG IRUPDNLQJLQYLYR 06GLDJQRVHVSURYHG\HWUHOLDEOH  &KDUFRW¶V SULPH QHXURORJLFDO 06 ILQGLQJ ZDV VHHQ WR RFFXU LQ FHUHEHOODU OHVLRQV RI DQ\ NLQG +LV VXEVHTXHQW VWDWHPHQWV RQ ZKDW VHW 06 VSHFLILFDOO\ DSDUW ZHUH FRQWUDGLFWRU\2QWKHRQHKDQGKHNHSWUHVWDWLQJWKDW06LVHVVHQWLDOO\GHILQHGE\LWV XQLTXHDQGXQLIRUPJURVVSDWKRORJ\  2QWKHRWKHUKDQGKHFRXOGQRWDEVWDLQIURPFODLPLQJDQHZWKDW06FDQEHLGHQWLILHG E\QHXURORJLFDO V\PSWRPVDQGVLJQV  

ϮϬ

1RWKLQJ LV VLPSOHU « WKDQ WR GLDJQRVH WKH DIIHFWLRQ LQ TXHVWLRQ 06  DW WKH EHGVLGHRIWKHSDWLHQW« 7UHPEOLQJRIWKHH[WUHPLWLHVLPSHGHGDUWLFXODWLRQJLGGLQHVVXQVWHDGLQHVV RIWKH H\HV HWF DUH V\PSWRPVEHORQJLQJWRPXOWLORFXODUVFOHURVLVDORQH &KDUFRW-0    ,QWKHEDODQFHRQO\&KDUFRW¶VDVVHUWLRQVWKDWDQGKRZ06ZDVWREHLGHQWLILHGLQWKH OLYLQJOHIWDODVWLQJLPSUHVVLRQ $Q LPSUHVVLRQ QRW OLPLWHG WR WKH QHXURORJLFDO SURIHVVLRQ 7KLV HQWDLOHG WKHLU EHLQJ VHFRQGHGE\HYHQEROGHUFODLPV (GZDUG7:LOVRQILUVWSXWGRZQWKDW«  7KHFRQGLWLRQ>06@LVGLVWLQJXLVKDEOHPRUHFOHDUO\E\LWVV\PSWRPVWKDQE\DQ\ VSHFLDOSDWKRORJ\  +H HYHQ EOXQWO\ TXHVWLRQHG WKH H[LVWHQFH RI DQ\ 06VSHFLILF SRVWPRUWHP ILQGLQJ :LOVRQ(7   4XLWH SDUDGR[LFDOO\ WKH IDPHG FOLQLFDO QHXURORJLVW +HLQULFK 3HWWH \HW DJDLQ XQGHUOLQHGWKDWWKHUHLVQR QHXURORJLFDOSKHQRPHQRQZKLFKZDVSHFXOLDUWRPXOWLSOH VFOHURVLV 3HWWH+   7ZHOYH\HDUVDIWHUWKHFOLQLFDOO\GHILQLWH06GLDJQRVHVKDGEHHQLQVWLWXWHGWKHIDFW WKDW D GLDJQRVLV RI PXOWLSOH VFOHURVLV FDQ EH PDGH GHILQLWLYH RQO\ DW SRVWPRUWHP VHHPVWRKDYHEHHQVWUHVVHGIRUWKH ODVWWLPH 0F'RQDOG:,+DOOLGD\$0    G $QDWRPLFDOSDWKRORJ\IDLOHGWRFDWDSXOW&KDUFRWWRIDPH  $VIRU06UHVHDUFKDQGFOLQLFDOSUDFWLFHWKHSRVWPRUWHPHYLGHQFHRQ&KDUFRW¶VILUVW DQG EHVW GRFXPHQWHG FDVH RI PXOWLSOH VFOHURVLV KDV WR DOO LQWHQWV DQG SXUSRVHV QHYHUVHHQWKHOLJKWRIGD\  7KLVDSSOLHVQRWRQO\WRWKHPDVWHUO\LOOXVWUDWLRQRIWKHILUVW06SODTXHGHWHFWHGLQD FHUHEUDOKHPLVSKHUH &KDUFRWPDGHLWDWWKHDXWRSV\RIDIHPDOHVHUYDQWRIKLVKRXVHKROG  &KDUFRW WKHUHE\ IDLOHG WR SRLQW RXW LQ ZKLFK UHVSHFWV WKH SRQV DQG FHUYLFDO FRUG 

Ϯϭ

OHVLRQVRIKLVSULPH06 FDVHGLGSDUDOOHO&UXYHLOKLHU VDQG&DUVZHOO V06ILQGLQJV ZHUHSUREDEO\XQNQRZQWRKLP  0RVWFRQIRUPDEOHOHVLRQDVSHFWVDUHGLUHFWO\HYLGHQWLQFRPSDULQJWKHOLWKRJUDSKVRI 3ODWH L DQG 3ODWH LL JLYHQ RQ SDJH  DQG  ZLWK WKH SLFWXUHV VKRZQ EHORZ WKH FHUHEUDOKHPLVSKHUHRQ3ODWHLLL 

 3ODWHLLL  $VUHJDUGVWKHLQWHUSUHWDWLRQRI&DUVZHOO¶V&UXYHLOKLHU¶VDQG&KDUFRW¶V06ILQGLQJV KRZHYHUQRPHPEHU RIWKHQHZO\IRXQGHGSURIHVVLRQRIQHXURORJ\IDUHGKHQFHIRUWK DQ\EHWWHU 

ϮϮ

$ SDSHU FHOHEUDWHG WKH WK DQQLYHUVDU\ RI WKH FOLQLFDO FKDUDFWHUL]DWLRQ RI 06 DV /HRSROG2UGHQVWHLQ VOHJDF\ /HKPDQQ+&HWDO   7KH IDFW WKDW &KDUFRW¶V SLFWRULDO VSHFLILFDWLRQ RI WKH DQDWRPLFDO SDWKRORJ\ RI 06 KDGFRQFOXGHG2UGHQVWHLQ VZRUNZDVQRWPHQWLRQHGZLWKHYHQDZRUG *HUPDQFOLQLFDO06GHVFULSWLRQVRIWKHSUHFHGLQJGHFDGHVZHUHPLVVHGEHVLGHV  &KDUFRW V XQSXEOLVKHG DXWRSV\ VNHWFKHV RQ WKH VDPH 06 FDVH VWRUHG ZLWK WKH SDWLHQW V FOLQLFDO UHFRUGV LQ 3DULV  %LEOLRWKqTXH &KDUFRW FRPSOHWHO\ HVFDSHG SXEOLF QRWLFH7KHODUJHSODTXHVKRZQLQWKHURRIRIWKHODWHUDOYHQWULFOHLVKHUHVHHQWRJHWKHU ZLWKDOHVLRQWKDWLQYDGHGWKHVSLQDOFRUGIURPERWKVLGHV  7KHODWWHUH[WHQGVDOODORQJWKHFRUGXSZDUGVWRHQGDEUXSWO\EHKLQGWKHORZHU SDUWRIWKHROLYH 3ODWHLY 

3ODWHLY 

Ϯϯ



3UHVHQWHGDWDQLQWHUQDWLRQDOPHHWLQJRI&&69,H[SHUWV 6FKHOOLQJ) &KDUFRW V XQSXEOLVKHG HDUOLHVW06LOOXVWUDWLRQVFRQWUDU\WRDQ\H[SHFWDWLRQGLGQRWSURYRNH DQ\TXHVWLRQVQRFRPPHQWQRGLVFXVVLRQ  6RPH PRUH ZRUGV VKDOO WKHUHIRUH EH ORVW RQ WKH VLJQLILFDQFH DQG WKH LQ IDFW SLRQHHULQJUROHRI&KDUFRW VILUVW06GRFXPHQWV  7KHXSSHUPRVWSLFWXUHJLYHQRQ3ODWHLLLIRUWKHILUVWWLPHFDUHIXOO\GHOLQHDWHGKRZDQ 06KDGLQYDGHGD FHUHEUDOKHPLVSKHUH $ODUJHSODTXHDVFRPSDFWFOHDUO\GHPDUFDWHGDQGURXQGHGDV&DUVZHOO VDQG &UXYHLOKLHU¶V SRQVOHVLRQVKDGLQYDGHGWKHURRIRIWKHODWHUDOYHQWULFOH,WVEXON\ WKXPEVKDSHG SRVWHULRU H[WHQVLRQ WKH WKUHH VPRRWKHU LQWHUPHGLDWH ZDYHV DQG LWV HEELQJDZD\LQIRXUOLWWOHVWHHSHUULSSOHVDSSHDUSHFXOLDULQWKHPVHOYHV  7KHLQWHULRUDVSHFWRIWKHSODTXHGHVHUYHVRIDVSHFLDODWWHQWLRQ 7KHOHVLRQFHQWHUVWKURXJKRXWRQIDLUO\ODUJHVXEHSHQG\PDOYHLQV 7RZDUGVWKH IURQWDO OHVLRQ ULSSOHV WKHVH YHLQV¶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





Ϯϰ

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¶VPDLQZRUN &KDUFRW-0  





Ϯϱ

,WV OLWKRJUDSKV VKRZ WKH PHGLDO VLGH RI WKH OHIW FHUHEUDO KHPLVSKHUH SRQV DQG WKH XSSHU FHUYLFDO FRUG 3ODWH Y   GHSORUDEO\ DJDLQ ZLWKRXW WHOOLQJ ZKDW KDG DURXVHG LQWHUHVWLQWKHJLYHQSLHFHV 

 3ODWHY  ,QWKHEUDLQDQLQWULFDWHO\URXQGHGVKDUSO\FLUFXPVFULEHGDQGHYHQO\DIIHFWHGSODTXH FHQWHUVRQWKHWKDODPXV  7KHVDJLWWDOO\VHFWLRQHGFRUSXVFDOORVXPFDOOVIRUVSHFLDODWWHQWLRQ7KHUHLVDVHULHV RIVKDUSO\GHOLPLWHGOHVLRQV 

Ϯϲ

7KHVWULNLQJO\SRLQWHGFHQWUDOOHVLRQZDYHVDQWHULRUO\VPRRWKO\HEEDZD\ZKLOH SRVWHULRUO\DQRWKHUEXON\OHVLRQVXUJHVXS  7KLVWLPH&KDUFRWSLFWXUHGQROHVLRQYHVVHOV 7KHFKDQJHVVHHPWRVLPSO\SURMHFWXSLQWRWKHFRUSXVFDOORVXPIURPEHORZ  7KHWKUHHORZHUILJXUHVRI3ODWHLYPDNHWKHGLVFUHSDQWPDQQHURIOHVLRQVSUHDGLQWKH SRQVDQGFHUYLFDOFRUGDIXUWKHUWLPHHYLGHQW  7KHUHDVRQIRUWKHFHUHEUDOUHVSHFWLYHO\VSLQDO06OHVLRQV GLIIHUHQWPRGHRIVSUHDG UHPDLQHG XQDGGUHVVHG  7KH YROXPH RI &KDUFRW ELRJUDSKLHV RI SDSHUV RI HQWULHV RI DOO VRUWV PDGH LQWR GLFWLRQDULHV DQG HQF\FORSHGLDV WR KRQRU WKH IRXQGHU RI FOLQLFDO QHXURORJ\ LV LPSUHVVLYH  1RZKHUH KRZHYHU &KDUFRW V PRVW SUHFLRXV SLHFHV RI 06 HYLGHQFH KLV PRVW JHQHURXVJLIWVWRWKH QHXURORJLFDODQGPHGLFDOSURIHVVLRQDUHPDGHPHQWLRQRI  2ULJLQDOO\JUDQWHGWRDIRUHLJQVXUSULVLQJO\*HUPDQQHXURORJ\VFKRODURIWKHQDPH /HRSROG2UGHQVWHLQ  $QG\HWWKLVJLIWPLJKWWXUQRXWWREH-HDQ0DUWLQ&KDUFRW VPRVWSUHFLRXVOHJDF\   



Ϯϳ

 &KURQLFDOO\PLVVHGWKHGXDOQDWXUHRI06   6HHQ LQ FRQWH[W &DUVZHOO¶V &UXYHLOKLHU¶V DQG &KDUFRW¶V 06 REVHUYDWLRQV UDLVH SULQFLSDOTXHVWLRQV :KRHYHUKDGGRXEWVRQWKHVSHFLILFLW\RIWKHJLYHQILQGLQJV" 'LG DQ\ERG\ VKRZ WKHVH ILQGLQJV UHODWHG WR GHILQLWH FOLQLFDO LQ SDUWLFXODU QHXURORJLFDO 06 REVHUYDWLRQV" $UH WKHUH LQGLFDWLRQV RI DQ LQIODPPDWRU\ LPPXQRORJLFDOO\ PHGLDWHG GHP\HOLQDWLQJ HQFHSKDORP\HOLWLV" 1RQH RI WKH SDSHUV TXRWHGLQVXSSRUWRIWKHFOLQLFDO06FRQFHSWLRQVFDQEHVDLGWRKDYHGRQHVR &DUVZHOO¶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

JUH\ GHJHQHUDWLRQ 06FKURQLFWXEHUFXORXVDQGOXHWLFHQFHSKDORP\HOLWLVVSHFLPHQV DUHKHUHIRXQGVLGHE\VLGH  ,QKLVILUVW06REVHUYDWLRQ&UXYHLOKLHU\HWLQGLFDWHGVRPHXQNQRZQGLIIHUHQFHLQWKH WLVVXHDIIHFWLRQVRIWKHSRQVDQGWKHVSLQDOFRUG  7KH GLIIHUHQW VKDGLQJ RI WKH ODWHUDO DQG PHGLDO OHVLRQ ]RQHV RI WKH ELODWHUDO FRUG OHVLRQVRI&UXYHLOKLHU¶V ILUVW 06 VSHFLPHQ 3ODWH LL RQ SDJH   PD\ LQWLPDWH ZKDW &DUVZHOOPRUHH[SOLFLWO\VKRZHG  $VDJDLQVWWKHFRUGOHVLRQVWKHSRQVSODTXHVDSSHDUDWDQ\UDWHWKURXJKRXWPRUH FRPSDFWDQGHYHQO\DIIHFWHG  ,QVWHDGRIKHHGLQJWKHVHGLIIHUHQFHVEHWZHHQFHUHEUDODQGVSLQDO06ERWKUHPDLQHG 

Ϯϴ

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pURVHHQSODTXHV  PHDQLQJDVFOHURVLQJSURFHVVLQWKHIRUPRISODTXHV  DQGWKH*HUPDQ PXOWLSOHVFOHURVLV  PXOWLORFXODUVFDUULQJSURFHVV NHSWWKHLUPHDQLQJ WR WKH H[WHQW UHVSHFWLYHO\ DV ORQJ DV WKH PXOWLSOH VFOHURVLV RI WKH VSLQDO FRUG ZDV IRFXVHGRQ  3LHUUH 0DULH DQG 2WWR 0DUEXUJ V 06 LOOXVWUDWLRQV PDGH HYHQWXDOO\ FOHDU WKDW PXOWLSOH VFOHURVLV LQ WKH VHQVH RI &DUVZHOO V SHFXOLDU GLVHDVHG VWDWH  GLG DW OHDVW FRQFHSWXDOO\QRORQJHUH[LVW  ,QFOLQLFDOFLUFOHVWKHQHZ06FRQFHSWLRQZDVWDNHQWRWHOOVRPHWKLQJHQWLUHO\QHZ DERXWWKHFRQGLWLRQ V SDWKRJHQHVLV  :LWKRXW WKH GXH VXEVWDQWLDWLRQ E\ H[HPSODU\ FRQVLVWHQW 06VSHFLILF REVHUYDWLRQV WKHFOLQLFDOO\ GLDJQRVHG06ZDVVHWIRUWKDVDSULPDU\PHDQLQJXQH[SODLQHGIRUPRI DQLQIODPPDWRU\GHP\HOLQDWLRQ  %HIRUHDQGGXULQJ::,,WKLV06LQWHUSUHWDWLRQZDVZRXQGXSZLWKWKHLGHDWKDWWKLV XQVSHFLILHG GHP\HOLQDWLRQKDGWREHFDXVHGE\VRPHIRUPRIDXWRLPPXQLW\ 3HWWH+    7KH SXEOLF DQG WKH PHGLFDO FRPPXQLW\ LV NHSW H[SHFWLQJ WKDW WKLV DXWRLPPXQH GHP\HOLQDWLRQZLOOEHGRFXPHQWHGE\VSHFLILFIDFWVWRWKLVYHU\GD\ 

Ϯϵ

7KHLGHDRIDQLQIODPPDWRU\DXWRLPPXQHGHP\HOLQDWLQJZKLWHPDWWHUGLVHDVHFDPH VRWRLQGLVSXWDEO\PRQRSROL]H06UHVHDUFK  )LQGLQJV UHIOHFWLQJ IHDWXUHV RI &DUVZHOO V DQG &KDUFRW V DQDWRPLFDOO\ VSHFLILHG 06 VWLOOKDSSHQHGWREH VKRZQIURPWLPHWRWLPH 7KH\DSSHDUHG\HWUDWKHUDVFXULRVLWLHVWKDQVRPHWKLQJGHVHUYLQJVSHFLDOLQWHUHVW  ,W FRXOG DFFRUGLQJO\ MXVW EH VRXJKW WR SLHFH WRJHWKHU ZKDWHYHU RI IUDJPHQWDU\ 06 VSHFLILFREVHUYDWLRQV LQOLQHZLWKWKHILQGLQJVRIWKHSDWKRORJLFDO06SLRQHHUVZDV WREHPDGHRXW   D 1RQFRQYHQWLRQDOWKHYHLQV¶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

ϯϬ

 %L]DUUHOHVLRQIRUPDWLRQVDQGJURWHVTXHYHLQZDOOGLVWHQWLRQVFKDUDFWHUL]HGWKH YHQWULFOHEDVHG DQGQHDUE\06SODTXHV 3ODWHYL 

3ODWHYL



 7KHLUH[HPSODU\)LJXUHSUHVHQWHGDOVRDYHQRXVWKURPEXV  &XULRXVO\ WKH WKURPEXV ORFDWLRQ XSVWUHDP RI WKH ODUJHVW SODTXH FRXOGQ W VKDNH 3XWQDP¶VEHOLHIWKDWLWZDVVXFKYHQRXVWKURPERVHVZKLFKFDXVHG06 7KHIDFWWKDWDYHQRXVRFFOXVLRQRQO\DIIHFWVWKHYHQRXVSHULSKHU\EXWLQYROYHVLWDVD ZKROHHYHU\ZKHUHHTXDOO\ZDVQ¶WWDNHQQRWHRI  *QDUOHG ORRNV RI SHULSKHUDO YHLQ PHVKHV DOVR OHIW D ODVWLQJ LPSUHVVLRQ 7KH SURFHVV 

ϯϭ

ZDV VHHQ WR DJJUDYDWH WR VXFK GHJUHHV WKDW WKH YHLQV GZLQGOHG DZD\ 3XWQDP 7- $GOHU$   1RZ LW WRRN DQRWKHU  \HDUV XQWLO WKH VSDWLDO UHODWLRQVKLS EHWZHHQ FHUHEUDO 06 SODTXHV DQG FHUHEUDO YHLQV ZDV IRFXVHG XSRQ 7KLV WKH EHVW GRFXPHQWHG WRSLFDO VWXG\ZDVGRQHRQWZR06EUDLQV  7RUEHQ)RJSXEOLVKHGWKHUHVXOWVRIWKLVLQYHVWLJDWLRQLQ +LVYROXPLQRXVSDSHU UHYHDOHGRWKHUVWUDQJHIDFWV :KLOH DSSHDULQJ KDSKD]DUGO\ DUUDQJHG WKH SODTXHV GHWHFWHG LQ WKH FHUHEUDO KHPLVSKHUHVKDG WKURXJKRXWRULJLQDWHGIURPTXLWHYDULHGVHJPHQWVRIDWWLPHV UHPDUNDEO\VWURQJYHLQV  :KDWSX]]OHGWKHREVHUYHUVHYHQPRUH 7KHD[HVRIWKHSODTXHVDQGWKHD[HVRIWKHLUYHLQVGLYHUJHGDVDUXOHWRPRUHRU OHVVVWULNLQJGHJUHHV )RJ LOOXVWUDWHG WKLV IDFW E\ FRXQWOHVV GUDZLQJV VKRZLQJ WKH VSDWLDO UHODWLRQVKLSV EHWZHHQZKDWKHUHIHUUHGWRDV« 7KHFHUHEUDO06OHVLRQVDQGWKHLU SDUHQWYHLQV  )RJ7   )RJVHHPVQRWWRKDYHNQRZQRI0DUN6FKHLQNHU VSDUDOOHOILQGLQJ 7KHPLFURJUDSKRIWKHHUXSWLRQRIDQ06SODTXHMXVWIURPRQHVLGHRILWVYHLQ 6FKHLQNHU0  3XWQDPDQG$GOHUV¶LOOXVWUDWLRQRIWKHFHUHEUDOSODTXHV XQHYHQ DQGHFFHQWULFH[SDQVLRQRIIWKHLUYHLQVVHHPWRKDYHHVFDSHGKLVDWWHQWLRQDVZHOO +HZDVREYLRXVO\DVOLWWOHDZDUHRIWKHSHUWLQHQWREVHUYDWLRQVZKLFK*DEULHO6WHLQHU KDGPDGHLQ 7KH FHUHEUDO 06 OHVLRQV¶ KDG FRQVLVWHQWO\ RULJLQDWHG LQ FHUWDLQ EORRG YHVVHOV  6WHLQHUZDVWKHUHE\HTXDOO\DVWRQLVKHGE\WKLVIDFW 7KHYHVVHOVIURPZKLFKWKHOHVLRQVHPHUJHGRQRWJRYHUQWKHZD\VLQZKLFKWKH OHVLRQVVSUHDG 6WHLQHU*   7KHVH VR LW VHHPHG XQSUHGLFWDEOH GHYLDWLRQV EHWZHHQ WKH GLUHFWLRQ RI WKH SODTXH H[SDQVLRQVDQGWKH FRXUVHRIWKHLU SDUHQWYHLQV \HWSUREDEO\H[SODLQHGDFFRUGLQJWR )RJDFXULRXVFLUFXPVWDQFH 7KH FHUHEUDO 06 SODTXHV  HPHUJHQFH IURP YHLQV KDG FRPPRQO\ HVFDSHG WKH UHVHDUFKHUV¶DWWHQWLRQ  7KH REVHUYHUV RI WKH EUDLQ SODTXHV  SDUDGR[LFDO VSUHDG RII WKHLU YHLQV RIIHUHG QR 

ϯϮ

H[SODQDWLRQ IRU LW 7KH SRVVLELOLW\ WKDW WKH EUDLQ SODTXHV¶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

ϯϯ

$Q XQH[SHFWHG SUHFLSLWDWH GHDWK SUHYHQWHG $GDPV IURP KLV LQWHQGHG LQYHVWLJDWLRQV LQWR WKH FDXVH RI WKHVH SX]]OLQJ FKDQJHV 2QH HOHPHQWDU\ SRLQW ZDV WKHUHE\ OHIW XQDGGUHVVHG7KHYHLQV¶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ƫLQJWUDLWVRIFHUHEUDODQGVSLQDO06ZHUHWKXVGHDOWZLWK WKHOHDVW  E 6SLQDO06)LEURXVZHGJHVH[WHQGLQWRDQGFURVVWKHFRUG  7KH DFFRXQW RQ WKH HDUOLHVW SDLQVWDNLQJ PLFURVFRSLF LQYHVWLJDWLRQ RI VSLQDO 06 DSSHDUHG LQ -HQD LQ  &DUO )URPPDQQ VKRZHG KRZ WKH SDWKRORJLFDO SURFHVV LQYDGHVLQSDUWLFXODUWKHWZRVLGHVRIWKH VSLQDOFRUG )URPPDQQ V UHVXOWV OHG WR UHJDUG DQG QDPH 06 D SULPDU\ VFOHURVLQJ LH VFDUULQJSURFHVV  

ϯϰ

&KDUFRWOHDUQHGRI)URPPDQQ VZRUNLQWKHVDPH\HDUDQGSURYHGGHHSO\LPSUHVVHG E\ LWVWKRURXJKQHVVDQGFRQVLVWHQF\  :KDW FRQYLQFHG &KDUFRW RI WKH DGHTXDF\ RI &DUO )URPPDQQ¶V FRQFOXVLRQV ZHUH KDUGO\ KLV H[KDXVWLQJO\ GHWDLOHG KLVWRORJLFDO GHVFULSWLRQV RI WKH PLQXWLDH RI VSLQDO 06 ,W ZDV UDWKHU WKH FOHDU GHPRQVWUDWLRQ ERWK PDFUR DQG PLFURVFRSLFDOO\ RI DV XQLTXHDVHQLJPDWLFWLVVXH FKDQJHV  )URPPDQQKDGUHDOL]HG 7KHSURFHVVRIVSLQDO06VSUHDGVE\ZD\RIDQH[FHVVLYHILEULOIRUPDWLRQZLWKLQ DQGILEULO RXWJURZWKRISDUWLFXODUSDUWVRIWKHSUHH[LVWHQWILEURXVIUDPHZRUNRI WKHVSLQDOFRUG 3ODWHYLL )LJJ&'  

3ODWHYLL  

ϯϱ



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

ϯϲ

7KHILEURXVFRQQHFWLRQVEHWZHHQWKHYHVVHOZDOODQGLWVVKHDWKZHUHVKRZQDQG QRWHGDVKDYLQJEHHQWRUQDVSDUWRIWKHSDWKRORJLFDOSURFHVVQRWDQDUWLIDFW  (YHQIRUDSK\VLFLDQZKRVHQDWLYHODQJXDJHLV*HUPDQ)URPPDQQ¶VZRUNLVQRWHDV\ WR UHDG 7KH VFUXSXORXVQHVV RI WKH SUHVHQWDWLRQ PD\ DFWXDOO\ KDYH GHWHUUHG PDQ\ D *HUPDQVSHDNLQJ SK\VLFLDQIURPVWXG\LQJWKHLPSUHVVLYHYROXPHDQGSRQGHULQJLWV PHWLFXORXV LOOXVWUDWLRQV LQ GHSWK &KDUFRW LQVWHDG SURYHG VR IDVFLQDWHG E\ )URPPDQQ¶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¶VGHVFULSWLRQRIWKHH[WHQVLRQRIVFDUULQJZHGJHVLQWRWKHWZRVLGHVRIWKH VSLQDOFRUG\HWLQGHSHQGHQWO\UHSHDWHGZKDW)URPPDQQKDGREVHUYHG  ,Q]RRPLQJLQRQWKHOHVLRQVZKLFKH[WHQGHGDORQJWKHVSLQDOFRUG¶VSRVWHULRUPHGLDQ DQG SDUDPHGLDQ VHSWD 'DZVRQ \HW QRWHG WKDW KHUH WKH OHVLRQV ZHUH PDUNHG E\ VWRUPLHUPRUHGHVWUXFWLYHHIIHFWV  $V VDLG )URPPDQQ KDG WKRXJKW WKDW WKH VZHOOLQJ K\SHUWURSK\ DQG K\SHUSODVLD RI LQWHUVWLWLDOWLVVXH VWUXFWXUHVZDVWKHFDXVHRIWKHVSLQDOOHVLRQGHYHORSPHQWV    

ϯϳ

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



ϯϴ

'HFDGHV ODWHU 6WHLQHU SLFWXUHG WKH SHULYHQWULFXODU DQG FRUWLFDO GDPDJHV LQ D PRUH V\VWHPDWLFZD\ 3ODWHYLLL  6WHLQHU 

3ODWHYLLL



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

ϯϵ

FHQWUDOSDUWV  +DYLQJVHULDOO\VHFWLRQHGDEUDLQWKH\VKRZHGVHULHVRISOXPSDQGVOHQGHUYHQWULFOH EDVHGSODTXHVWRKDYHULVHQRIIRIWKHODWHUDODQGWKLUGYHQWULFOHV 7KHGDPDJHVGRQHWRWKHFRUSXVFDOORVXPZHUHDVZHOOUHDOL]HGWRKDYHVSUHDGIURP WKHLQVLGHRXW 6LHPHUOLQJ(5DHFNH-  DVPLJKWKDYHEHHQVXVSHFWHGIURP&KDUFRW¶VODWHU06OLWKRJUDSK 3ODWHYSDJH   'DZVRQFKDUDFWHUL]HGWKHVHOHVLRQGHYHORSPHQWHYHQPRUHSODVWLFDOO\ 'HQVH VFOHURVLV WKDW HQFRPSDVVHV WKH EUDLQ¶V ODWHUDO YHQWULFOHV RULJLQDWHV LQ VHSDUDWHURXJKO\ ILQJHUGRPHRUFRQHVKDSHGOHVLRQVZKLFKDULVHLPPHGLDWHO\ XSRQWKHYHQWULFXODUOLQLQJ7KHVH OHVLRQVVXUJHRUGLJLWDWHDVLWZHUHRIIRIWKH ODWWHURXWZDUGVXSVWUHDPWKHORFDOYHLQV 7KLVPRWLYDWHG/XPVGHQLQWRFRLQLQJWKHWHUP 'DZVRQ¶VILQJHUV   7KH OHVLRQV FDSSLQJ WKH IURQWDO RFFLSLWDO RU WHPSRUDO KRUQV RI WKH ODWHUDO YHQWULFOH URVH DFFRUGLQJ WR 'DZVRQ FRQIRUPDEO\ LQWR DSLFHV RU VKRUWHU RU ORQJHU URXQGHG RIIVKRRWV  /HVLRQV KDYLQJ H[SDQGHG DV IDU RXW DV WR DEXW WKH FRUWH[ DQG MX[WDFRUWLFDO SODTXHV ZHUHGHVFULEHGDVIODWWHQLQJDJDLQVWLWVERUGHUDVWKRXJKWKH\KLWDZDOO )RJFKDUDFWHUL]HGVXFKOHVLRQVDSSHDULQJEXOJHGLQE\WKHERWWRPRIDFRUWLFDOVXOFXV DVVHPLOXQDURU PXVKURRP SODTXHV   7KHSODTXHVZHUHLQIDFWREVHUYHGWRIRUFHWKHLUZD\HYHU\ZKHUHPRUHHDVLO\LQWR WKHZKLWHWKDQ LQWRWKHJUH\PDWWHUVWUXFWXUHVEXWVWLOOWRQRWUDUHO\SHQHWUDWH WKHEUDLQ VFHQWUDOQXFOHLDQG FRUWLFDOOD\HUV  7KH ODUJHVW 06 SODTXHV ZHUH VHHQ WR ULVH RII RI WKH RXWHU DQJOH RI WKH ODWHUDO YHQWULFOHV ,W LV WR WKLV DUFK RI DQ DQJOH WKDW DOO WKH FROOHFWLQJ YHLQV RI WKH FHQWUDO SDUWV RI WKH FHUHEUDOKHPLVSKHUHVFRQYHUJH  6WHLQHU FKDUDFWHUL]HG WKLV VWUXFWXUH DV WKH :HWWHUZLQNHO  OLWHUDOO\ ¶WKXQGHUVWRUP FRUQHU RI06  ,W LV WKH FRUQHU IURP ZKLFK 'DZVRQ¶V ILQJHUV¶ DQG 6WHLQHU V HOOLSVRLG SODTXHV  W\SLFDOO\ VSODVKRII  SODWHYLLL  

ϰϬ

G 05,LQ06:KHQFHWKHDQJVWRIWKHQHXURORJLVW"   05 LPDJLQJ IRU WKH ILUVW WLPH DOORZHG WR GHSLFW WKH FHUHEUDO 06 SODTXHV  HFFHQWULF H[SDQVLRQV DQG WR PRQLWRU WKH UHOHQWOHVV SURJUHVVLRQ RI WKH FRXQWHUFXUUHQWYHLQGHSHQGHQWOHVLRQVSUHDG  2GGO\HQRXJKQRGLUHFWDWWHPSWDWGHPRQVWUDWLQJWKLVXQSDUDOOHOHGGLVHDVHG\QDPLFV E\VSHFLILFH[DPSOHVVHHPVWRKDYHEHHQPDGH 7KH SRWHQWLDO RI 05, WR LGHQWLI\ WKLV XQPLVWDNDEOH IRUP RI SDWKRORJ\ KDVQ¶W DQ\ZKHUHEHHQIXOO\H[SORLWHG  ,Q WKH FHUHEUDO KHPLVSKHUHV 06 SODTXHV ZHUH MXVW VKRZQ WR VXGGHQO\ HPHUJH DQG H[SDQG DQG WKHQ  XQGHU IDYRXUDEOH FLUFXPVWDQFHV  WR HDUOLHU RU ODWHU PRUH RU OHVV FRPSOHWHO\UHFHGHDQGZDQH  1HLWKHUWKHXQSUHFHGHQWHGSURVSHFWVWRLGHQWLI\FHUHEUDO06SODTXHVE\VSHFLILFYHLQ UHODWLRQVKLSV QRU WR VSRW VSLQDO 06 OHVLRQ H[WHQGLQJ LQ EHWZHHQ DQ\ RI WKH VSLQDO FRUG VPRRULQJVWUXFWXUHVKDYHEHHQ WDNHQDGYDQWDJHRI  &RXQWOHVV RSSRUWXQLWLHV IRU WKXV IXUWKHULQJ WKH XQGHUVWDQGLQJ RI 06 PLJKW DOUHDG\ KDYHEHHQPLVVHG  5RXWLQH05,UHSRUWVORFDOL]H06OHVLRQVLQUDWKHUYDJXHZD\V 6XSUD DQG LQIUDWHQWRULDO SHULYHQWULFXODU FDOORVDO GHHS ZKLWH PDWWHU MX[WD VXE DQGFRUWLFDOFKDQJHVEUDLQVWHPDQGVSLQDOFRUGIRFLDUHVSRNHQRI  7KH\KHHGGLYHUVHPLQLPXPOHVLRQQXPEHUVDQGVL]HVWRFRPSO\ZLWKVHWFULWHULDIRU VSHDNLQJRIDUDQGRPVFDWWHULQJLQVSDFH 2OGDQGQHZUHVSHFWLYHO\HQKDQFLQJOHVLRQVDUHWKHUHFRJQL]HGHYLGHQFHIRUDOHVLRQ VFDWWHULQJLQ WLPH  :KDWXOWLPDWHO\FRXQWVKRZHYHULVWKLV 7KH REVHUYHU PXVW KDYH QR FOXH ZKDW WKH REVHUYHG 8%2V  XQLGHQWLILHG EULJKW REMHFWV WKHRIWHQSHUVLVWHQW EODFNKROHV¶DSSHDURIOHVVLQWHUHVWDUHRUPLJKWEH FDXVHGE\  7KXVEHLQJNHSWLQVXFKDVXERUGLQDWHDQFLOODU\GLDJQRVWLFSRVLWLRQQHXURUDGLRORJLVWV 

ϰϭ

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ƥ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



ϰϮ

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¶VILQJHUV   6PDOOEDUVKDSHGDQGODUJHFXUYLOLQHDUGHIHFWVZHUHVKRZQWRSHQHWUDWHLQDGGLWLRQ WKHSDWLHQWV¶EUDLQVWHPV 06@ VSHFLILF LPPXQRORJLFDO DEQRUPDOLW\ KDV HYHU EHHQ IRXQG DQG FRQILUPHG ± )LQGVWKLVREMHFWLRQQREHWWHUDQVZHUWKDQWKHXVXDO7KHDEVHQFHRIHYLGHQFHLVQR HYLGHQFHRIDEVHQFH"  5HDGHUVPD\ZRQGHUZKHWKHU>LQFRPSDULQJGLIIHUHQW06DFFRXQWV@WKHVDPH GLVHDVHLVEHLQJVWXGLHG ± ,VWKHUHDQRWKHUFRPSDUDEO\SHUYDVLYHDQGSHUVLVWHQWSUREOHPWKDWNHHSVKDXQWLQJ 06UHVHDUFK"  ,PPXQRVXSSUHVVLRQKDVIDLOHGWRKDYHDQ\FRQVLVWHQWHIIHFWRQSURJQRVLVDQGGLVHDVH SURJUHVVLRQ ± :KRSURYHG06@ZDVWRDODUJH H[WHQWDZDVWHEDVNHWGLDJQRVLVVRPHWKLQJQRWWREHPDGHVHQVHRI  +HZDUQHGLQWKHHQGWKDW ZLWKJRRGWKHUDSLHVIRUVRPHRIWKH06PLPLFVDFFXUDWHGLDJQRVLVLVDPXVW ,QDGGLWLRQWRWKHFRVWRIWUHDWPHQWPDQ\RIWKHFXUUHQWWUHDWPHQWVDUHQRW EHQLJQ DQG ZH VKRXOG QRW VXEMHFW RXU SDWLHQWV WR XQQHFHVVDU\ KDUPIXO WKHUDSLHV +HUQGRQ50  

ϳϱ

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

ϳϲ

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

ϳϳ

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

ϳϴ

7KH SURVSHFWV RI VSDULQJ PDQ\ D SDWLHQW KHU RU KLV GHVSHUDWH IDWH HYHU ZRUVHQLQJ WURXEOHV DQ HQGLQJ XS LQ LQVXUPRXQWDEOH UHODWLRQDO DQG VRFLDO GLƥ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



ϳϵ

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¶V SUHVHQWDWLRQ RI KLV ILUVW 06 OLWKRJUDSKV WKH IXWXUH RI &&69,DQG06UHVHDUFK KDVDSSDUHQWO\RQO\MXVWEHJXQ  



ϴϬ

5HIHUHQFHV  $EVLQWD01DLU*6DWL3&RUWHVH,&)LOLSSL05HLFK'6'LUHFW05,GHWHFWLRQRI LPSHQGLQJ SODTXH GHYHORSPHQW LQ PXOWLSOH VFOHURVLV 1HXURO 1HXURLPPXQRO 1HXURLQIODPPH  $GDPV&$&RORXU$WODVRI0XOWLSOH6FOHURVLV 2WKHU0\HOLQ'LVRUGHUV/RQGRQ :ROIH0HGLFDO3XEOLFDWLRQV  $GOHU0-$ULVWRWOHIRU(YHU\ERG\1HZ