Incyte Annual Report 2017

FY2017 Annual Report · Incyte

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CONTENTS

IN CY TE 2017 Annual Report

2017 in Review

Letter to Stockholders
Year in Review
Patients Drive Us

2018 Goals

Initiation of New Pivotal Programs
Potential Clinical Data Presentations
Anticipated Regulatory Milestones
Financial Guidance

Revenue Drivers

Jakafi® (ruxolitinib)
Iclusig® (ponatinib)
Royalties

Our Science

Discovery Platforms
Later-Stage Development Portfolio
Earlier-Stage Portfolio
Partnered Programs

Incyte’s Team

Our Culture
Our History
Our Leadership

Corporate Responsibility

Patients
Team
Community
Environment
Compliance and Transparency

Company Information

Company Information
Forward-Looking Statements
Footnotes

Incyte hosted a ribbon cutting ceremony

to celebrate the opening of our new global

headquarters in Wilmington, Delaware.

LETTER TO STOCKHOLDERS

2017 IN REVIEW

Dear Fellow Stockholders,

2017 was a year of great progress and momentum at Incyte, marked by the significant advancement of our

development portfolio and growth of our organization. Today, we are operating at a scale never before seen

within our company. More than 1,200 talented and dedicated employees across three continents are working

together towards the goal of building Incyte into a leading global biopharmaceutical company. Amidst this great

transformation, one thing has remained unchanged – our mission to improve the lives of patients by solving some

of the most critical health needs facing society. Patients are the reason we come to work energized and why we are

relentless in our pursuit of scientific innovation. It is through this shared purpose that we aim to drive continued

success, cement our global leadership in oncology, and drive long-term value for our shareholders.

An exciting year for business growth

Notably, we delivered strong financial performance in 2017, with more than $1.5 billion in total revenues,
representing an increase of nearly 40 percent over 2016. We added Olumiant® (baricitinib)1 royalties as an
important new source of revenue, following its approval for the treatment of rheumatoid arthritis in Europe and in

Japan. We also greatly improved our balance sheet this year with the retirement of over $700 million of convertible

debt and a year-end balance of cash, equivalents, and marketable securities of $1.2 billion.

From a talent and operations perspective, we grew more than 20 percent in 2017, adding experts from both industry

and academia to our team. We also achieved our goal of establishing a footprint in Asia. With the opening of our

office in Tokyo, Japan we’ve rounded out our global presence and built a strong backbone to allow for expanded

developmental reach and commercial access. We believe we now have the talent, financial resources, and

geographic reach to bring our cutting-edge therapies to patients in need around the globe.

Helping more patients than ever — and we’re just getting started

We continue to see strong and consistent growth in the number of patients benefiting from Jakafi® (ruxolitinib)2
therapy. According to our estimates, more than 11,000 patients in the U.S. were on therapy during the fourth

quarter of last year. We will continue to work with doctors, patients, patient advocacy groups, and the U.S. Food and

Drug Administration (FDA) to further expand access to those who may be able to benefit from this treatment.

Innovation is in our DNA at Incyte, and underlying each of our research and development programs is a clear

mission to create first-in-class and best-in-class medicines that address significant unmet needs for patients.

Our innovative approach to R&D and our exceptional team of chemists and biologists have created a development

portfolio that continues to grow and advance, fueled by our significant investment in discovery. Today, we have a

robust pipeline comprised of 20 clinical candidates being studied against 17 discrete targets, which is truly unique

for a company of our size.

INCYTE 2017 Annual Report2017 IN REVIEW

Significant progress in our development portfolio

Within our portfolio, our later-stage development programs progressed significantly. With six candidates now in

later-stage development, we see the potential for multiple product launches over the next four years. In the near

term, we expect two important clinical events in the first half of 2018:

• Results of the pivotal REACH1 trial of ruxolitinib in patients suffering from steroid-refractory

acute graft versus host disease (GVHD)

• Initial results from the pivotal ECHO-301 trial of epacadostat plus pembrolizumab in the treatment

of unresectable or metastatic melanoma

The new set of ECHO trials evaluating epacadostat in combination with PD-1 antagonists in four different tumor

types continue to enroll, and our other pivotal GVHD trials, REACH2, REACH3, and GRAVITAS-301, are ongoing,

with data from these trials expected beginning in 2019. We also expect data from FIGHT-202, which is evaluating

our novel FGFR1/2/3 inhibitor, INCB54828, in patients with cholangiocarcinoma in 2018.

Our early-stage programs also continue to progress. We expanded our discovery capabilities in 2017 through our

bispecifics collaboration with Merus, providing additional opportunities for us to deliver on our commitment to

improving and extending the lives of patients with cancer and other serious diseases. Additionally, we added three

new clinical candidates to our early-stage portfolio. Following a three-year discovery effort, we are excited to bring

our dual AXL/MER inhibitor into clinical trials, and, through our discovery alliance with Agenus, we have both a

TIM-3 and a LAG-3 inhibitor that are expected to begin clinical trials in the coming months.

A new home for collaboration and innovation

To complement these important advancements, we were excited to complete and move into our expanded global

headquarters in Wilmington, Delaware in 2017. I strongly believe that innovation does not happen over e-mail;

it happens when smart people work together in a shared environment. Our new work space was built to provide us

with the technology and collaborative setting needed to help drive our long-term success.

INCYTE 2017 Annual Report“ To complement these important advances, we were excited to
complete and move into our newly expanded global headquarters
in Wilmington, Delaware in 2017.”

2017 IN REVIEW

In closing, our talented team produced outstanding results in 2017 that we believe have laid the groundwork for

future success. Looking to that future, we will continue to work together to transform how cancer is treated by

following the science, not taking shortcuts, and ensuring we always keep patients at the forefront of everything we do.

I am proud of what we have achieved, but our work is far from done. With a strong balance sheet, some of the most

talented colleagues in the industry, and dynamic year-over-year revenue growth, we are in an excellent position to

continue delivering on our mission. Our opportunity to serve patients has never been greater, and I look forward to

sharing our future achievements with you.

Best regards,

Hervé Hoppenot
Chairman and CEO

Forward-looking statements: Safe Harbor rules govern any forward-looking statements

made in this Annual Report; for more information, please visit page 40.

INCYTE 2017 Annual Report“ We know we speak a lot about the science. There is
no interesting science without the patient’s impact.
Because if your drug does nothing important, it’s not really
worth it. What we see today in the transformation of cancer,
is that if we have a good science, you can see very quickly how
much it’s impacting people like all of us, like our own families
in a way that is extraordinarily meaningful.”
Hervé Hoppenot
Chairman and CEO

INCYTE 2017 Annual ReportYEAR IN REVIEW

2017 IN REVIEW

“ It’s incredibly motivating to work in a place where the common goal
is to cure cancer. It has been exciting to watch the organization grow,
and I continue to be inspired by my colleagues’ passion and drive to
help patients. I find it so rewarding to be in a position that supports
such a highly talented team.”
Jennifer Kilpatrick
Senior Director, Benefits

The significant advancement of our development portfolio and growth of the organization has put Incyte in an

excellent position to continue delivering on our mission of improving the lives of patients and driving long-term

value for our shareholders.

Incyte-at-a-Glance

INCYTE 2017 Annual Report2017 IN REVIEW

Scientific Progress

Over the past year, we’ve placed great emphasis on increasing our scientific reach. In early 2017, we were proud

to reopen our building at 1801 Augustine Cut-Off as dedicated laboratory space for the Incyte Research Institute.

This additional remodel allowed us to double our laboratory space and therefore significantly increase our

capacity and productivity for our discovery scientists. Also during the year, we almost doubled the number of

clinical trials for our therapeutic candidates, which in turn drove a significant increase in the number of patients

participating in Incyte-sponsored trials.

“ At the end of 2017, there were more than 2,000 patients
across over 600 clinical sites in 15 countries participating
in our Incyte-sponsored trials.”

We continue to be motivated by both the challenge and responsibility to improve the lives of patients suffering

from cancer and other serious diseases.

Revenue Growth and Financial Strength

In 2017, Incyte saw nearly 40 percent revenue growth over 2016.

INCYTE 2017 Annual ReportGlobal Growth and Expansion

Incyte has 13 offices in 12 countries. In 2017, we opened a new office in Tokyo, Japan and grew our

headcount by nearly 20 percent.

2017 IN REVIEW

Expansion of Wilmington Campus

We are proud of our expanded global headquarters in Wilmington, Delaware, which provides more room for

our growing research and development activities.

The campus reflects our commitment to creating an environment that fosters innovation. In addition to housing

administration, the clinical development teams, and an expanded lab, we also have multiple outdoor amenities,

gardens, and spaces to allow for collaboration and interaction across teams.

INCYTE 2017 Annual ReportPATIENTS DRIVE US

2017 IN REVIEW

Sue’s Myelofibrosis Story

It was early spring when Sue’s life was turned upside down. She was looking forward to an upcoming trip to
Florida for her son’s college baseball tournament. But something wasn’t right. She kept having strange pains in

her left side and felt incredibly tired. Worried about flying while she wasn’t feeling well, Sue went to an urgent

care clinic to get herself checked out. They noted that she had an enlarged spleen and told her to go see

a doctor for blood work.

After two doctors’ appointments in two days - including one with a hematologist - Sue was told she wasn’t going

to Florida. She would instead need to come back the next day for a biopsy.

When the biopsy came back, the results confirmed myelofibrosis, which is part of a rare group of blood cancers

known as myeloproliferative neoplasms (MPNs). Sue immediately searched the internet, and what she

found was grim.

“I was pretty upset,” Sue recalls.

“ You just picture what you’re going to miss, all this time you’re not
going to get with your family.”

In the shock of processing this news, Sue went through what she calls a “period of numbness.” She was more

upset for her family than for herself, for her husband, Gary, and for the prospect of not being there when their

three sons got married and started families of their own.

But then Sue received some great news. An MPN specialist informed her that the information on the internet

was outdated. This gave Sue a renewed sense of hope. That’s when her doctor told her about Jakafi, which had

been approved for use only a few months earlier.

“I was exhausted and I didn’t feel good. I was worried and scared, and then the Jakafi came.”

After starting Jakafi2, Sue could feel a meaningful difference in her abdomen, caused by her spleen shrinking.
She started feeling hungry again and had fewer symptoms and less fatigue.

INCYTE 2017 Annual Report2017 IN REVIEW

Today, working with her doctor, Sue has been on Jakafi for six years, and she continues to do well on treatment.

“My energy has been fantastic,” Sue declares. “I’ve been feeling really good.”

“ I couldn’t believe that a tiny pill could make such an impact
on my health. It just seems impossible, but it did.”

Sue’s experience living with myelofibrosis has also given her a new perspective on life.

“I appreciate everything more than I ever did before. I’m not waiting anymore. I’m taking advantage of every

minute, and doing so more than maybe I would have if I’d never been diagnosed.”

Sue has taken that appreciation to heart in everything from travel (her favorite destination: Hawaii) to spending
more—and better—time with her family and friends, to sharing her experience with others and helping raise

awareness for myelofibrosis. She even spoke to us here at Incyte during the celebration for the opening of our

expanded global headquarters.

And all those family moments that Sue was worried she would miss in the early days of her diagnosis—her children

getting married, establishing careers, and starting families of their own—she now looks forward to witnessing.

Sue’s kindness, good humor, and appreciation for life inspire all of us here at Incyte. Stories like hers are powerful

reminders of why we do the work that we do.

INCYTE 2017 Annual Report“ My day-to-day at Incyte is highly variable, but I try to
begin each day by remembering that patients are waiting.
And so for me, that means focusing on my clinical trials.
So I need to recognize, truly, the importance of the work
that we’re doing here. It’s really important to me.”
Bill Garrett
Director, Senior Clinical Trial Head

INCYTE 2017 Annual ReportLOOKING AHEAD TO 2018

2018 GOALS

2018 promises to be exciting, with the readout of two pivotal programs and an FDA decision expected in the

first half of the year. Beyond these significant milestones, we continue to work diligently to increase the number

of appropriate patients benefiting from our therapies as well as evaluate our clinical candidates across a broad

spectrum of cancers and other diseases.

Initiation of New Pivotal Programs

We are proud to expand our ECHO program to include a new pivotal trial in partnership with AstraZeneca studying

epacadostat in combination with durvalumab in patients with non-small cell lung cancer (NSCLC). Study initiation

is expected to begin in the first half of 2018.

Potential Clinical Data Presentations

ECHO-301

A pivotal trial of epacadostat in combination with pembrolizumab for the first-line treatment of patients with

unresectable or metastatic melanoma. Initial results are expected in the first half of 2018.

REACH1

A pivotal trial of ruxolitinib in patients with steroid-refractory acute graft-versus host disease (GVHD).

Results are expected in the first half of 2018.

FIGHT-202

A Phase 2 study of INCB54828 in patients with cholangiocarcinoma. This represents a global, first-to-market

opportunity. Initial results are expected by year-end 2018.

Anticipated Regulatory Milestones

• In 2018, we intend to file an sNDA for ruxolitinib in steroid-refractory acute GVHD pending

positive results from REACH1.

• We anticipate an FDA decision for baricitinib in moderate to severe rheumatoid arthritis

by mid-2018.

Financial Guidance

Our full-year 2018 financial guidance is as follows:

Jakafi® (ruxolitinib)2 net product revenues

$1.35 billion–$1.40 billion

GAAP

Non-GAAP

Iclusig® (ponatinib)3 net product revenues

$80-$85 million

Cost of product revenues

$85-$95 million

$64-$74 million4

R&D expenses

SG&A expenses

$1.2 billion–$1.3 billion

$1.077 billion–$1.172 billion5

$515-$535 million

$465-$480 million6

Change in fair value of acquisition-related
contingent consideration

$30 million

$0 million7

INCYTE 2017 Annual Report“ We try and set the highest standard that we can so that we
can move forward at a faster rate, a faster pace, but still
doing the right science. So it still all comes back to the science,
doing the right thing at the right time with the right people.
What we say quite often in the lab is, ‘Individual success
equals team success, equals Incyte success, and ultimately
equals patient success.’”
Maryanne Covington
Director, Pharmacology

INCYTE 2017 Annual ReportREVENUE DRIVERS

REVENUE DRIVERS

Our robust growth in product-related revenue comes from four sources: sales from Jakafi® (ruxolitinib)2, sales
from Iclusig® (ponatinib)3, and royalties from both Jakavi® (ruxolitinib)8 and Olumiant® (baricitinib)1. In 2017, total
product-related revenue increased nearly 40 percent over 2016. In 2017, total product-related revenue increased

nearly 40 percent over 2016.

Jakafi

Jakafi continues to outperform our expectations.

At the end of 2017, more than 11,000 patients

in the United States were benefiting from

this treatment.

• Our 2018 Jakafi net product revenue

guidance is $1.35 billion-$1.40 billion.

• The long-term net product revenue

guidance for Jakafi was increased to $2.5

billion-$3.0 billion in January 2018.

Iclusig

Iclusig sales growth has also been strong,

with Q4 sales growing 51 percent over Q4 of

last year. We believe this speaks to the quality of

our European organization and should bode well

for potential global drug launches in the future.

• Our 2018 Iclusig net product revenue

guidance is $80 million-$85 million.

Royalties

For the year, we recognized $152 million in

Jakavi (ruxolitinib) royalties from Novartis –

representing 37 percent growth over last year –

and $9 million in Olumiant royalties from

Eli Lilly, both contributing to our top-line.

INCYTE 2017 Annual Report“ I think we hold a unique position here at Incyte. We have a
really strong pipeline, and we have a lot of different projects
in a lot of different areas that target different biological systems
that have potential to treat a variety of different diseases.
I think the thing that gives us an advantage is that we can find
and develop new targets and molecules that will complement
our existing portfolio.”
Eddy Yue
Research Fellow, Discovery Chemistry

INCYTE 2017 Annual ReportA BROAD CLINICAL PORTFOLIO

OUR SCIENCE

Incyte’s clinical development portfolio is comprised of 20 clinical candidates being studied against 17

discrete targets. Our oncology portfolio includes cutting-edge immuno-oncology and targeted therapies,

including small molecules, large molecules, and bispecific antibodies, providing us the opportunity to explore

combinations of therapies from both within and beyond our own portfolio. In addition, we are also advancing

several clinical programs in non-oncology indications, including studies of a topical formulation of our

JAK1/JAK2 inhibitor ruxolitinib in atopic dermatitis and vitiligo.

“ We have incredible talent in our discovery and development teams
which has translated into a unique portfolio of product candidates.
What matters most in the work we do is to strive to improve lives or cure
patients, and Incyte has a strong team of energetic people fully committed
to that effort. Our collective goal to leverage this portfolio and bring new
and innovative therapies to market for patients in need makes me very
proud to work here.”
Christine Mage
Senior Director, Global Medical Communications

Discovery Platforms

Small Molecules

Large Molecules

Bispecifics

Incyte was founded on its expertise
in small molecule discovery, and it
continues to be the backbone of
the company. Currently, the majority
of clinical candidates in the portfolio
come from Incyte’s small molecule
discovery unit. We continue to
increase capacity and add new
capabilities to fully capitalize on
success and build a more robust and
diverse early clinical portfolio.

Incyte began large molecule discovery
efforts in 2015 through a discovery
alliance with Agenus. This partnership
was very productive, yielding four
potential clinical candidates in a
very short time frame. Molecules
which target GITR and OX40 have
already been delivered into clinical
development, and two additional
candidates, which target TIM-3 &
LAG-3, respectively, are expected
to enter the clinic in 2018. Incyte’s
discovery team has also developed
the large molecule platform internally
to develop molecules independent of
any collaborations.

Due to their unique ability to
simultaneously engage multiple
protein targets, we believe bispecific
antibodies have the potential to
play an important role in the future
of biotherapeutics. As such, we
entered into a long-term research
collaboration with Merus to discover
and develop bispecific antibodies.
This collaboration further expands
our large molecule discovery
capabilities into an innovation-rich
area of research, which we believe
will create additional opportunities
over the next ten years.

INCYTE 2017 Annual ReportLater-Stage Development Portfolio

Our later-stage development programs continue to progress well. With six clinical compounds now in later-stage

development, we see the potential for multiple product launches over the next four years.

OUR SCIENCE

INCB50465
(PI3K8)

ruxolitinib
(JAK1/JAK2)

MGA012
(PD-1)

INCB54828
(FGFR1/2/3)

epacadostat
(IDO1)

itacitinib
(JAK1)

Jakafi®(ruxolitinib)2
We have achieved great success with our first approved
product, Jakafi®, and we seek to further develop therapeutics
based on our expertise in JAK inhibition.

Ruxolitinib in Graft Versus Host Disease (GVHD)
The incidence of GVHD has been growing in recent years
due to the increase in the number of allogeneic transplants.
Unfortunately, approximately 50 percent of these transplant
patients develop GVHD, and mortality rates in these patients
can be very high. In the first year, mortality rates can be
between 25 percent and 75 percent, depending on the grade,
so the unmet need here is very clear.

Building upon positive, independently published third-party
data of ruxolitinib in GVHD, we initiated the REACH clinical
program to evaluate ruxolitinib in patients with steroid-
refractory GVHD. REACH1, a pivotal Phase 2 trial in steroid-
refractory acute GVHD, was initiated in December 2016
and is now fully recruited. REACH2, the Novartis-sponsored
Phase 3 trial in steroid-refractory acute GVHD, and REACH3,
the Phase 3 trial in steroid-refractory chronic GVHD that is
co-sponsored by Incyte and Novartis, are both now underway.

INCB50465 (PI3K Delta)
The PI3K-delta pathway mediates oncogenic signaling in
B cell malignancies. INCB50465 is a PI3K-delta inhibitor
that has demonstrated potency and selectivity in preclinical
studies and has potential therapeutic utility in the treatment
of patients with lymphoma. We have initiated the CITADEL
clinical program to evaluate INCB50465 in non-Hodgkin
lymphomas, including patients with diffuse large b-cell
lymphoma (DLBCL), follicular lymphoma, marginal zone
lymphoma, and mantle cell lymphoma.

Ruxolitinib in Essential Thrombocythemia (ET)
Ruxolitinib has shown meaningful symptomatic benefits
in patients with myeloproliferative neoplasms (MPNs).
In our effort to provide additional treatment options for these
patients, we decided to expand the development of ruxolitinib
to include ET, a Philadelphia chromosome negative MPN
characterized by the overproduction of platelets in the bone
marrow. The pivotal RESET trial is enrolling ET patients that
are refractory to or intolerant of hydroxyurea, the current
standard of care for first-line treatment of these patients.

Itacitinib (JAK1)
Itacitinib is a selective JAK1 inhibitor, which is 20 times more
selective of JAK1 over JAK2. Similar to ruxolitinib, we believe
itacitinib could be an exciting new treatment option for patients
with GVHD. Preliminary data from a proof-of-concept trial
of itacitinib in patients with acute GVHD showed that
treatment-naïve patients treated with itacitinib had an overall
response rate of more than 80 percent. Based on this
promising data, a pivotal program investigating itacitinib
in patients with treatment-naïve acute GVHD was initiated
in July 2017.

INCYTE 2017 Annual ReportOUR SCIENCE

INCB54828 (FGFR1/2/3)
INCB54828 is an inhibitor of the FGFR isoforms 1, 2, and 3
that has demonstrated potency and selectivity in preclinical
studies. The FGFR family of receptor tyrosine kinases can
act as oncogenic drivers in a number of liquid and solid
tumor types. We initiated the FIGHT clinical program to
evaluate INCB54828 across a spectrum of cancers that are
driven by FGF/FGFR mutations. The program now has three
Phase 2 trials enrolling: FIGHT-201 in patients with bladder
cancer, FIGHT-202 in patients with cholangiocarcinoma,
and FIGHT-203 in patients with 8p11 myeloproliferative
syndrome (8p11 MPN).

MGA-012 (PD-1)
We understand that PD-1 inhibition is likely to be an
important backbone in the future of immunotherapy. To
that end, we acquired the exclusive worldwide rights for the
development and commercialization of MacroGenics’ PD-1
inhibitor, MGA-012, in all indications. Enrollment in the dose
escalation portion of the Phase 1 study of MGA-012 has been
completed, and it is currently being evaluated as monotherapy
across four solid tumor types in the dose expansion portion of
the study.

Epacadostat (IDO1)
Epacadostat is a first-in-class, potent, and selective inhibitor
of IDO1, an enzyme with immunosuppressive effects that
undermine the immune system’s natural ability to attack
tumor cells. Tumors can exploit multiple mechanisms to
evade immune surveillance, and we hypothesize that the
combination of epacadostat with immunotherapy agents
targeting other mechanisms of immune evasion may re-
establish antitumor immunity across a broad range of cancers.

Our ongoing ECHO clinical development program is
investigating the development of epacadostat in combination
with other therapeutic agents, including checkpoint inhibitors,
vaccines, epigenetic therapies, and chemotherapies.

Our most advanced trial is ECHO-301, a Phase 3
study evaluating the combination of epacadostat with
pembrolizumab as a first-line treatment for patients with
unresectable or metastatic melanoma. This trial is now fully
recruited, and we expect to announce initial results in the first
half of 2018.

Our ECHO program has grown significantly in the last year
to include nine additional pivotal trials. There are now
six new pivotal trials in patients with non-small cell lung
cancer (NSCLC), bladder, renal, and head & neck cancer in
combination with pembrolizumab, two new pivotal trials in
patients with NSCLC and head & neck cancer in combination
with nivolumab, and one new additional trial in patients
with NSCLC in combination with durvalumab. The trials in
combination with pembrolizumab and nivolumab are now all
recruiting patients, and we expect the trial in combination
with durvalumab to begin in the first half of 2018.

INCYTE 2017 Annual ReportEarlier-Stage Portfolio

OUR SCIENCE

AXL /
MER

LAG-3

FGFR4

TIM-3

BRD

ARG

LSD1

JAK1

OX40

PIM

GITR

INCAGN2385 (LAG-3)
INCAGN2385 is a LAG-3 inhibitor which was discovered within
our antibody discovery alliance with Agenus Inc. LAG-3 is a
cell surface receptor that negatively regulates antigen-specific
T cell responses. The LAG-3 pathway has been identified as a
potential barrier to productive tumor-specific T cell immunity
generated by PD-1/PDL-1 blockade. Pre-clinical evaluation of
INCAGN2385 showed that the compound was well-tolerated
and demonstrated the expected pharmacokinetic profile. Incyte
is now wholly responsible for driving development forward, and
we expect to initiate a Phase 1 study to explore the safety and
tolerability of INCAGN2385 as a monotherapy in patients with
advanced solid tumors in 2018.

INCB81776 (ALX/MER)
INCB81776 is an orally administered, potent, and selective
inhibitor of AXL and MER kinases that exhibits selective
pharmacological activity and enhanced anti-tumor immune
activity. AXL and MER are critical regulators of innate immunity,
phagocytosis, and immune-suppressive activity and therefore
may be able to impact the growth, survival and malignant
progression of neoplastic cells directly and potentially even
restore and enhance host immunity against cancers. We are
expecting to initiate clinical work to explore the safety and
tolerability of INCB81776 in patients with advanced solid
tumors in 2018.

INCAGN2390 (TIM-3)
INCAGN2390 is a TIM-3 inhibitor which was discovered
within our antibody discovery alliance with Agenus Inc. TIM-3
is an inhibitory receptor involved in immune tolerance often
co-opted by tumors to prevent successful antitumor responses.
Pre-clinical evaluation of INCAGN2390 showed that the
compound was well-tolerated and demonstrated the expected
pharmacokinetic profile. Incyte is now wholly responsible for
driving development forward, and we plan to initiate a Phase 1
study to explore the safety and tolerability of INCAGN2390 as
a monotherapy in patients with advanced solid tumors in 2018.

INCB62079 (FGFR4)
INCB62079 is a selective, irreversible inhibitor of FGFR4 that
has exhibited 250 times greater selectivity for FGFR4 than
other FGFR isoforms in preclinical studies. Preclinical data has
also demonstrated the compound’s selective activity against
cancer cell lines with FGF19-FGFR4 pathway activation, and
dose-dependent activity in murine models of FGF19-driven
hepatocellular carcinoma. A Phase 1/2 dose escalation trial in
patients with advanced hepatocellular carcinoma and other
malignancies is now underway.

INCB01158 (ARG)
INCB01158 is a first-in-class, small molecule arginase
inhibitor in hematology and oncology licensed from Calithera
Biosciences, Inc. In preclinical models, arginase inhibition has
been shown to enhance antitumor immunity both as a single
agent and in combination with other immunomodulatory
therapeutics. INCB01158 is currently being studied as a
monotherapy and in combination with the anti-PD-1 agent
pembrolizumab.

INCB57643 (BRD)
INCB57643 is a BRD inhibitor. BRDs are a family of proteins
which play important roles in mediating gene transcription,
most notably by facilitating the expression of oncogenes such as
MYC, one of the most frequently dysregulated oncogenes in all
human cancer. INCB57643 is in an open-label dose-escalation
trial in patients with advanced malignancies

INCB59872 (LSD1)
INCB59872 is an LSD1 inhibitor. The function of LSD1 has been
reported to maintain stem cell-like gene expression patterns in
various cancers, including acute myeloid leukemia and small cell
lung cancer. A proof-of-concept clinical trial of INCB59872 is
underway.

INCYTE 2017 Annual Report
INCB53914 (PIM)
INCB53914 is a pan-PIM kinase inhibitor that has demonstrated
potency and selectivity in preclinical studies. Overexpression of
PIM kinases has been reported in human hematological cancers
with each isoform showing a distinct expression pattern among
the various malignancy subtypes. A clinical trial of INCB53914 in
advanced malignancies is underway.

INCAGN1949 (OX40)
INCAGN1949 is an anti-OX40 agonist antibody, which is being
developed within our antibody discovery alliance with Agenus
Inc. OX40 is a costimulatory receptor that is expressed on
effector T cells and is important for T cell survival and enhanced
cytokine production. Preclinical data demonstrate that anti-
OX40 agonist antibodies inhibit tumor growth by enhancing
the levels and function of effector T cells and by decreasing
regulatory T cells. Incyte is now wholly responsible for driving
devlopment forward, and clinical trials studying INCAGN1949
as a monotherapy and in combination with other immune
checkpoint inhibitors are under way.

OUR SCIENCE

INCAGN1876 (GITR)
INCAGN1876 is an anti-GITR agonist antibody, which was
discovered within our antibody discovery alliance with Agenus
Inc. GITR is a costimulatory receptor that is expressed on
effector T cells and is important for T cell survival and enhanced
cytokine production. Preclinical data demonstrate that anti-
GITR agonist antibodies inhibit tumor growth by enhancing
the levels and function of effector T cells and by decreasing
regulatory T cells. Incyte is now wholly responsible for driving
devlopment forward, and clinical trials studying INCAGN1876
as a monotherapy and in combination with other immune
checkpoint inhibitors are underway.

INCB52793 (JAK1)
INCB52793 is a selective JAK1 inhibitor, which is 150 times
more selective for JAK1 over JAK2. INCB52793 is currently
being evaluated in combination cohorts with azacitadine in
patients with acute myeloid leukemia (AML).

Partnered Programs

Baricitinib is a JAK1/JAK2 inhibitor, which we licensed to Eli Lilly in 2009. Baricitinib has now been approved
in Europe, Japan, and other regions outside of the United States as Olumiant®1 for the treatment of patients
with rheumatoid arthritis (RA) in patients with inadequate response to standard-of-care therapies.

In December 2017, Lilly confirmed that it had resubmitted the NDA for RA, and the FDA subsequently accepted

it as a Class II resubmission, which leads to a six month review. We and Lilly look forward to a final decision

from the FDA in the first half of 2018.

Beyond RA, Lilly initiated a Phase 3 program of baricitinib in atopic dermatitis in late 2017 and has stated that

it expects to initiate a Phase 3 program in psoriatic arthritis in 2018. Lilly has also stated that the results from

the Phase 2 trial of baricitinib in patients with systemic lupus erythematosus are expected to be presented

at a medical meeting later in 2018.

Capmatinib, a MET inhibitor which we licensed to Novartis, is currently in a Phase 1b/2 trial in patients with

MET-amplified lung cancer, and data are expected in 2018. Novartis has stated that it anticipates submitting

an NDA in this indication in 2019.

INCYTE 2017 Annual Report“ I’m most inspired in my job by the patient. I’ve had the opportunity
in my role to speak with a number of MPN patients
and the overwhelming response that I have gotten is of gratitude.
Even if it’s a little bit of time, any little bit of extra time for
a patient is so impactful. And so that’s what inspires me and
gets me out of bed every day.”
Mary Beth Rush
Director, Consumer Marketing

INCYTE 2017 Annual ReportWHAT MAKES INCYTE, INCYTE

INCYTE’S TEAM

At Incyte, we’re driven by a passion for innovative science and a desire to make a meaningful difference in the lives

of patients with cancer and other serious diseases.

Our Culture

At Incyte, nothing is more foundational to our success than our people. It is their talent, passion, creativity, and

commitment that have allowed us to follow the science and achieve important advances in the treatment of cancer

and other serious diseases. We believe that when our colleagues thrive and everyone is encouraged to reach their

fullest potential, we are better able to pursue pivotal innovations and truly help patients.

We take our responsibility to support our people and to create a challenging, fulfilling work environment seriously.

Perhaps that’s why, sixteen years on, 17 of our 23 original colleagues still work at Incyte.

Original Incyte colleagues gather to celebrate our 15th anniversary in Delaware in the fall of 2017.

We support our colleagues through open and honest performance reviews and plentiful opportunities to interact

with and ask questions of senior leadership. We also regularly invite patients to speak at our quarterly Town Halls

to share their journeys. Meeting them and hearing their stories allows us to connect directly with those we’re

working to help.

We also celebrate outstanding achievements with our Incyte Bravo Award program, which provides the opportunity

to recognize and reward extraordinary efforts of our colleagues here at Incyte.

Incyte fosters a culture of passion, accountability, and teamwork. We are motivated by our primary challenge to

discover first-in-class and best-in-class medicines for patients in need. All of our discovery research takes place

onsite in our Wilmington, Delaware headquarters, where collaboration between research and development helps

optimize decision making and drive innovation.

INCYTE 2017 Annual ReportINCYTE’S TEAM

“ At Incyte, our culture is one of trust and empowerment. Our globally
integrated team’s goal is to play a transformative role in the fight against
cancer to impact the lives of patients and that is what inspires us to aim
higher, push harder and innovate tirelessly.”
Bryan Black
Regional VP, Head of European Legal Affairs

At Incyte, we are constantly looking to improve ourselves, whether in the research lab, in continuing education

and training, or in our cafeterias, which provide nutritious options, or in office-based group fitness classes.

We believe this makes us a healthier, stronger, and more tightly knit team.

We also strive to maintain our small company culture even as we grow and expand. Social events such as our

annual Chinese New Year/Lunar New Year celebration and a family day at the Adventure Aquarium in Camden,

NJ allow everyone to interact and get to know each other outside of meetings and also facilitates a place for

people to meet new colleagues they may not have the opportunity to connect with based on their roles.

Incyte colleagues gather in our office in Geneva, Switzerland.

Join Us

Are you inspired by innovative science and intelligent, passionate coworkers? Do you want to be part of a team that

continues to develop and deliver first-in-class and best-in-class medicines for patients with cancer and

other diseases?

Visit our Careers page to explore current opportunities and learn more about working at Incyte, including the

competitive benefits package we offer employees at www.incyte.com/join-us/careers.aspx.

INCYTE 2017 Annual Report“ The ideal Incyte employees are people that are
intellectually curious. They have the ability to multitask,
to be flexible, to change directions, to really respond to
new data that’s constantly coming in.”
Paula Swain
Head of Human Resources

INCYTE 2017 Annual ReportOur History

Incyte’s drug discovery and development efforts were founded in 2002 in Wilmington, Delaware by a team of world-

class research scientists, chemists, and biologists. Sixteen years later, we have evolved into a global company with

operations in the United States, Europe, and Japan.

INCYTE’S TEAM

Drug discovery efforts founded

2002

JAK2 mutation in MPNs discovered

2005

FDA approved Jakafi as first
treatment for polycythemia vera2

2014

Incyte Europe created and
European commercialization
rights to Iclusig® (ponatinib)3
obtained through acquisition of
ARIAD Pharmaceuticals'
European operations

Olumiant® (baricitinib)1
marketing approvals received
in Europe (February) and
Japan (July)

2016

2017

Expanded global headquarters and
campus in Wilmington, Delaware

2017

2004

Ruxolitinib synthesized and
first investigational new drug
application filed

2011

FDA approved Jakafi® (ruxolitinib)
as first treatment for myelofibrosis2

2015

Established first office outside
of United States

2016

Surpassed $1B in revenue

2017

Established Japanese operations

INCYTE 2017 Annual ReportOur Leadership

INCYTE’S TEAM

Hervé Hoppenot
Chairman, Chief Executive Officer

Jonathan E. Dickinson
General Manager, Europe

Lothar H. Finke, MD, PhD
Head of Clinical Development
and General Manager, Japan

Barry P. Flannelly,
PharmD, MBA
General Manager, US

David W. Gryska
Chief Financial Officer

Reid M. Huber, PhD
Chief Scientific Officer

Vijay Iyengar, MD
Head of Global Strategy and
Corporate Development

Michael Morrissey
Head of Global Technical
Operations

Steven H. Stein, MD
Chief Medical Officer

Paula J. Swain
Head of Human Resources

Wenqing Yao, PhD
Head of Discovery Chemistry

Board of Directors

Hervé Hoppenot
Chairman and Chief Executive Officer, Incyte Corporation

Julian C. Baker
Managing Partner, Baker Brothers Investments

Jean-Jacques Bienaimé
Chief Executive Officer, BioMarin Pharmaceutical, Inc.

Paul A. Brooke
Founder and Former Managing Partner, venBio LLC

Paul J. Clancy
Executive Vice President and Chief Financial Officer,
Alexion Pharmaceuticals, Inc.

Wendy Dixon, PhD
Former Chief Marketing Officer and President, Global
Marketing, Bristol-Myers Squibb Company

Jacqualyn A. Fouse, PhD
Executive Chair, Dermavent Sciences

Paul A. Friedman, MD
Chief Executive Officer, Madrigal Pharmaceuticals, Inc.

INCYTE 2017 Annual Report“ There aren’t redundancies in roles at Incyte. Every one of us has
a specific role to play, and you have to do that in order for the
company to be successful and for patients to be impacted.
We’re encouraged to provide solutions and ideas that will impact
the company and ultimately the patient. No idea, regardless
of how aspirational, is ever laughed at or frowned upon. It’s
actually encouraged.”
Mary Beth Rush
Director, Consumer Marketing

INCYTE 2017 Annual ReportBEING A GOOD CORPORATE CITIZEN

COR PORAT E RESPONSIBILITY

At Incyte, our commitment extends beyond our own success to enhancing the communities in which we operate,

improving the treatment and experience of patients, supporting our colleagues, and protecting the environment.

Patients

Commitment to Patients
At Incyte, we take our commitment to patients with cancer and other diseases very seriously. Having a positive

impact on their lives is our highest calling as a company, and we support our patients through commitments in four

key areas: Patient Safety, Scientific Excellence, Access to Medicine, and Patient Education and Awareness.

Patient Safety
Patient safety is our highest priority, and we believe that clinical trials and approvals by global regulatory

authorities offer the optimal means of providing patients with broad access to medicines as prescribed by qualified

healthcare professionals. Before we initiate any clinical trial, we ensure there is an appropriate risk-to-benefit

ratio and have protocols in place to obtain each participant’s informed consent. We also use an Independent Data

Monitoring Committee to supervise all ongoing trials to better protect the safety of trial participants.

Scientific Excellence
At Incyte, we believe in following the science. We hold our clinical research to the highest scientific and ethical

standards, from our rigorous discovery process, to our adherence to clinical standards set by the FDA and other

global regulatory bodies, to our focus on data transparency through presentations of both positive and negative

data at appropriate medical meetings and in peer-reviewed journals.

We also believe that science is a collaborative effort, and we are committed to partnering with companies,

universities, and other research institutions to share knowledge, resources, and ideas that may best benefit patients.

“ The patient support program is a part of the job that makes me
excited to come to work. We talk to patients and advocates, and
it’s clear that assistance in managing cancer beyond providing
medication is needed. Our goal is to support them in the course of
the disease and help them deal with the loneliness and anxiety that
comes with a cancer diagnosis - and there is more for us to do. Being
able to contribute, even in a small way, is very rewarding.”
Esther Broer
Senior Brand Manager

INCYTE 2017 Annual ReportCOR PORATE RESPONSIBILITY

Access to Medicine
Incyte is committed to ensuring patients have access to life-changing medicines.

Some patients with serious conditions may be eligible to participate in an Incyte-sponsored clinical trial but

unable to pay for certain costs. We are committed to improving these patients’ access to clinical trials by providing

financial support as appropriate and consistent with applicable laws, regulations, and guidelines. We may also

choose to provide individual patients with access to unapproved or investigational products outside of a clinical

trial setting through Incyte’s compassionate use program.

Our IncyteCARES (Connecting to Access, Reimbursement, Education, and Support) program strives to support

patients in the United States before and during treatment with ongoing education resources as well as a dedicated

nursing support program. IncyteCARES also provides co-pay assistance or free medicine to eligible patients to help
cover some of the costs associated with their Jakafi® (ruxolitinib)1 prescription. For more information,
visit www.IncyteCARES.com.

In June 2017, the National Institute for Health and Care Excellence (NICE) in the United Kingdom published a
recommendation for Iclusig® (ponatinib)3 as an option to treat adult patients with Philadelphia-positive acute
lymphoblastic leukemia (Ph+ ALL) and chronic, accelerated, or blast phase chronic myeloid leukemia (CML) within

its approved marketing authorization, so long as we provide it with the discount agreed in the patient access

scheme. Iclusig had been available to patients through the Cancer Drugs Fund since the summer of 2013 after

approval by the European Medicines Agency (EMA) as an orphan drug. As of March 2018, Iclusig is fully reimbursed
in 20 European countries (plus Israel).

Incyte plans to launch CML Life during 2018, a patient support program for patients in Europe suffering from

chronic myeloid leukemia (CML), regardless of their treatment or their stage of disease. CML Life will seek to help

patients, caregivers, and heath care professionals better understand CML from diagnosis to treatment, with the

goal of improving patient outcomes. This program has been co-created and co-developed with the patients that

may eventually be using it, as well as the healthcare professionals who may also be supporting its use.

INCYTE 2017 Annual ReportCOR PORATE RESPONSIBILITY

Patient Education and Awareness
Voices of MPN is a website launched by Incyte that was created to help connect MPN patients to information,

educational programs, and community activities as well as to provide a forum where people can share stories and

promote disease awareness.

Each year, in partnership with CURE Magazine, Incyte sponsors the MPN Heroes program, which honors and

celebrates individuals and organizations for their contributions in caregiving, community leadership,

or scientific advances in the MPN community. Experience Voices of MPN for yourself at www.VoicesofMPN.com.

Our 2017 MPN Heroes were honored for their commitment to MPN care at the annual MPN Heroes Celebration Event,
hosted by CURE Media Group.

Team

Commitment to Our Team
Incyte is committed to ensuring our colleagues are happy and healthy. We offer competitive compensation and

benefits packages, and over the years have added numerous additional benefits to support colleagues in their

professional and personal endeavors.

We encourage continuing education through internal training, as well as relevant external courses.

Additional learning seminars on topics as diverse as nutrition and financial planning are also offered on-site.

In addition to a competitive benefits package, we fulfill our commitment to the health of our team members

through free flu shots and access to complimentary health incentives, such as free melanoma screenings

or nutrition counseling. We’ve also introduced a patient support program, which helps employees, spouses,

domestic partners, children, parents, and parents-in-law with a variety of healthcare and insurance-related issues,

including researching services, securing second opinions, and making more informed decisions. All team members,

including part-time employees, are eligible for this benefit.

Furthermore, our cafeterias provide nutrition-conscious options, helping to make sure that colleagues can make

more informed dietary choices while at work.

INCYTE 2017 Annual Report“ At Incyte, I feel that we empower our employees. I’ve empowered
my team, and I’ve been empowered by my manager, as well,
to come up with an idea and implement it. What’s the worst
thing that’s going to happen? It’s not going to work, but then
we learn from that and we come up with another solution.”
Ankur Shah
Director, U.S. Medical Information

INCYTE 2017 Annual ReportCommunity

Commitment to Our Community
Our community is more than an address. It’s our home. Through Incyte Involved, we support three initiatives focused

on actively participating in and improving our community.

COR PORATE RESPONSIBILITY

The Incyte Charitable Giving Foundation is dedicated to supporting charitable organizations serving the needs of
local Delaware communities. The foundation is focused on two areas – oncology patient support and helping people in

need. In 2017, the Incyte Charitable Giving Foundation’s first full year of giving, the Foundation provided support for

16 local organizations, up from 10 in 2016.

Through the Foundation, we also launched the Incyte Cancer Care Assistance Fund for Delaware with our partner,

Cancer Support Community Delaware, which will provide emergency financial assistance for cancer patients, their

caregivers and family members living in Delaware. The fund will provide financial assistance for medical expenses and/

or basic living expenses on behalf of cancer patients who demonstrate financial need as a result of their illness and

their treatment. Expenses that would be considered include medical bills, co-pays, scans, and testing, as well as rent,

mortgage, utilities, phone, transportation, groceries, and childcare.

A team from Incyte participated in the B+ Foundation’s 5K event. B+ Foundation is one of the many organizations
for which the Incyte Charitable Giving Foundation has pledged to provide funding.

Our Community Service Program provides our colleagues with paid time off to volunteer in their communities.
In 2017, Incyte colleagues donated nearly 700 hours of time working with organizations including the Food Bank of

Delaware, Habitat for Humanity, and Salvation Army. This is a remarkable increase of more than 60 percent since 2016.

INCYTE 2017 Annual ReportWe also support our colleagues’ charitable interests through our Matching Gifts Program, which matches 100 percent

of their donations up to a predetermined cap. In 2017, we matched more than $100,000 given by our colleagues to their

charities of choice. In line with our growth in operations, we also extended the matching gifts program to our team in

Europe. Learn more about Incyte Involved at www.incyte.com/what-we-do/incyte-involved.aspx.

COR PORATE RESPONSIBILITY

Incyte participated in LLS’s Light the Night event for the eighth year running.

Beyond these formal programs, we also enjoy being involved in many other charitable events and drives.
For example, a group of Incyte colleagues participated in the 5K event at the European Hematology Association’s

(EHA) Annual Congress in Madrid.

More than 30 colleagues from Incyte participate in the 5K event to benefit patients at the European Hematology
Association’s (EHA) Congress in Madrid.

INCYTE 2017 Annual ReportCOR PORATE RESPONSIBILITY

Other philanthropic events during the year included the Miles for Melanoma 5K Walk/Run to support and raise
funds for the Melanoma Research Foundation and our eighth year in participating in the Light the Night Walk,
which benefits the Leukemia & Lymphoma Society. A group of Incyte colleagues from around the United States also
volunteered to set up and man water stations at the Cancer Survivors’ Celebration Walk & 5K during the 2017
American Society of Clinical Oncology’s (ASCO) Annual Meeting. The event collectively raised more than $318,600 for

the Robert H. Lurie Comprehensive Cancer Center of Northwestern University.

A team from Incyte participated in the B+ Foundation’s 5K event. B+ Foundation is one of the many
organizations for which the Incyte Charitable Giving Foundation has pledged to provide funding.

During the holiday season, we feel it’s especially important to be mindful of those who are less fortunate than us.

That’s why every year we have an annual food drive to collect food and cash donations for the Food Bank of Delaware

and an annual Salvation Army Angel Tree Program, in which Delaware-based employees can buy toys for one or more

local children in need. In 2017, Incyte collectively donated 950 pounds of food for the Food Bank of Delaware and

helped 800 families in Delaware.

By participating in charitable activities, we deliver a positive impact on the greater communities in which
we live and work.

Incyte colleagues use their paid volunteer day to help the Toy Shop sort and organize donations from Incyte and others.

INCYTE 2017 Annual Report“ Incyte Involved is really starting to create a community
service culture, and it’s helping us to become good business
leaders in the community that we work and live in.”
Paula Swain
Head of Human Resources

INCYTE 2017 Annual ReportCOR PORATE RESPONSIBILITY

Environment

Commitment to the Environment
Incyte is committed to operating in a way that reduces our environmental impact. This commitment includes

programs for data collection and analysis in order to measure and reduce hazardous air emissions, greenhouse

gases, and water use. All hazardous waste is recycled, reused, fuel blended, or disposed of at an EPA-approved

disposal facility.

“ Over 80 percent of Incyte’s chemical waste is fuel blended
for energy recovery.”

We also make it convenient for our team members to help support environmental sustainability. For example,

separate waste and recycling bins are placed throughout our offices, both in public areas and at each individual’s

workstation. Our new cafeteria at our expanded headquarters goes even further, using reusable plates and

silverware to limit landfill waste.

Incyte also supports the use of electric cars by colleagues with charging units in our parking lots for complimentary

use during the day.

Incyte’s commercial operations team recently began using only Forest Stewardship Council® (FSC)-certified

printers for all of Incyte’s marketing materials. In addition, we now only use paper made from recycled material for

all of our printed pieces.

Compliance and Transparency

Commitment to Compliance and Transparency
We aim to make a difference – for patients, medical professionals, organizations, the broader healthcare

community, and all our global stakeholders. To achieve these goals, we are committed to conducting business

ethically. We hold ourselves accountable to the highest standards to ensure that all of our interactions are

conducted appropriately. We regularly review and amend our practices according to current laws and regulations,

as well as both our own standards and the standards required of us by the communities in which we live and work.

All new team members are required to read and acknowledge their commitment to comply with Incyte’s Code of

Business Conduct and Ethics, which serves as our roadmap for acting ethically whenever and wherever we conduct

business. It provides, among other things, that:

• We foster a respectful and safe workplace

• We conduct business ethically

• We operate honestly and transparently

• We act as a good corporate citizen

For more details, please visit our Corporate Governance page at www.incyte.com/ir/corporate-governance.aspx.

INCYTE 2017 Annual ReportCOMPANY INFORMATION

IN CYTE CORPORATION

Corporate Headquarters

Incyte Corporation
1801 Augustine Cut-Off

Wilmington, DE 19803

855.446.2983

Transfer Agent and Registrar
Computershare

PO Box 43078

Providence, RI 02940-3078

250 Royall Street

Canton, MA 02021

877.272.1536

http://www.computershare.com/investor

TDD for Hearing Impaired:
800.231.5469

Foreign Stockholders:
201.680.6578

TDD Foreign Stockholders:
201.680.6610

Outside Counsel
Pillsbury Winthrop Shaw Pittman LLP

Independent Registered Public Accounting Firm
Ernst & Young LLP

Market Information
Incyte Common Stock trades on The Nasdaq Global

Select Market under the symbol INCY.

Investor Relations
You can obtain recent press releases and other publicly

available information on Incyte by visiting our website

at www.incyte.com.

Contact
Michael Booth, DPhil

Vice President, Investor Relations

mbooth@incyte.com

Lauren Kwiecinski, MBA

Director, Investor Relations

lkwiecinski@incyte.com

Annual Meeting
The Annual Meeting of Stockholders will be held

May 1, 2018, at 2:00 pm, Eastern Daylight Time,

at Incyte Corporation, 1801 Augustine Cut-Off,

Wilmington, DE 19803.

INCYTE 2017 Annual ReportIN CYTE CORPORATION

Forward-Looking Statements

Except for the historical information set forth herein, the matters set forth in this annual report contain

predictions, estimates and other forward-looking statements, including without limitation statements regarding:

our belief that we now have the talent, financial resources and geographic reach to be able to bring our therapies to

patients around the globe; our expectations for important clinical events in the first half of 2018; our expectation

for data from the REACH2, REACH3 and GRAVITAS-301 trials beginning in 2019; our expectation for data from

FIGHT-202 later in 2018; our goal to transform Incyte into a world-class global biopharmaceutical organization;

our ability to expand access to Jakafi (ruxolitinib) to those who may be able to benefit from this treatment;

whether we are successful with new product launches over the next four years; our expectation to begin clinical

trials for our TIM-3 and LAG-3 inhibitor in the near term; whether we will achieve any of our planned goals for

2018, including without limitation the initiation of our new pivotal programs and the potential clinical data

presentations as well as anticipated regulatory milestones; our financial guidance for 2018; our expectation

that our collaboration with Merus will create additional growth opportunities over the next ten years; plans for

continued development of Jakafi (ruxolitinib) in essential thrombocythemia and GVHD as well as additional

indications and life cycle management plans for Jakafi (ruxolitinib) and myeloproliferative neoplasm research;

whether the pivotal trials of epacadostat in combination with pembrolizumab and in combination with nivolumab

will be successful, including the ECHO-301 study in advanced or metastatic melanoma, and the expected timing

of developments relating to those studies; whether baricitinib for RA will be approved in the U.S.; whether and

when Lilly will pursue possible next steps towards seeking or achieving approval in the U.S. for baricitinib for RA,

whether baricitinib will ever be approved in the U.S. for any indication and whether development of baricitinib in

other indications will be successful or will continue as currently planned; plans and expectations regarding our

product pipeline and strategy - including timelines for advancing our drug candidates (including without limitation

epacadostat, ruxolitinib and itacitinib) through clinical trials (including enrollment and commencement), whether

certain trials will serve as the basis for registration, timelines for regulatory submissions and timelines for releasing

trial data, and whether any specific program will be successful - and plans and expectations regarding development

activities of our collaboration partners; whether we will realize the anticipated benefits of our collaborations;

whether the plans and expectations regarding our pipeline over the next 12 months will drive potential value;

whether and when we will launch CML Life and whether it will help improve patient outcomes; and the potential

therapeutic and commercial value of our drug candidates.

These forward-looking statements are based on our current expectations and are subject to risks and uncertainties

that may cause actual results to differ materially, including unanticipated developments in and risks related
to: the efficacy or safety of our products and the products of our collaboration partners; the acceptance of our

products and the products of our collaboration partners in the marketplace; market competition; the results of

further research and development by our company, our collaboration partners or our competitors; sales, marketing,

distribution and manufacturing requirements; clinical trials, including pivotal trials, possibly being unsuccessful

or insufficient to meet applicable regulatory standards for clinical advancement or approval or warrant continued

development; the ability to enroll sufficient numbers of subjects in any such clinical trials; other market, economic

or strategic factors and technological advances; unanticipated delays in clinical trials or drug development

generally; our ability to compete against parties with greater financial or other resources; our dependence on our

relationships with our collaboration partners; greater than expected expenses; expenses relating to litigation

or strategic activities; obtaining and maintaining effective patent coverage for our products and our product

candidates; and other risks detailed from time to time in our reports filed with the Securities and Exchange

Commission, including our Form 10-K for the year ended December 31, 2017. We disclaim any intent or obligation

to update these forward-looking statements.

INCYTE 2017 Annual ReportFOOTNOTES

IN CYTE CORPORATION

Worldwide rights to baricitinib licensed to Eli Lilly; Olumiant (baricitinib) is approved for the treatment of mild to moderate
rheumatoid arthritis in patients with inadequate response to standard-of-care therapies

Jakafi (ruxolitinib) is approved for use in intermediate or high-risk myelofibrosis, including primary myelofibrosis, post-
polycythemia vera myelofibrosis and post-essential thrombocythemia myelofibrosis, and in patients with polycythemia vera who
have had an inadequate response to or are intolerant of hydroxyurea

Iclusig (ponatinib) is approved for use in chronic myeloid leukemia (CML) and Philadelphia-positive (Ph+) acute lymphoblastic
leukemia (ALL) patients who are resistant to or intolerant of certain second generation BCR-ABL inhibitors and all patients who
have the T315I mutation

Adjusted to exclude the amortization of licensed intellectual property for Iclusig relating to the acquisition of the European
business of ARIAD Pharmaceuticals, Inc.

Adjusted to exclude the estimated cost of stock-based compensation and upfront consideration of approximately $13 million
relating to the Syros Pharmaceuticals, Inc. collaboration

6. Adjusted to exclude the estimated cost of stock-based compensation

Adjusted to exclude the change in fair value of estimated future royalties related to sales of Iclusig in the licensed territory
relating to the acquisition of the European business of ARIAD Pharmaceuticals, Inc.

8. Ex-U.S. rights to ruxolitinib license to Novartis; commercialized by Novartis as Jakavi

INCYTE 2017 Annual Report