13G Filing: Biotechnology Value Fund L P and Arqule Inc (ARQL)

As of October
16, 2017 (i) BVF beneficially owned 8,820,763 shares of Common Stock, including 1,115,932 shares of Common Stock issuable upon
the exercise of certain Warrants, (ii) BVF2 beneficially owned 5,124,370 shares of Common Stock, and (iii) Trading Fund OS beneficially
owned 1,378,980 shares of Common Stock.

Partners OS as the general partner
of Trading Fund OS may be deemed to beneficially own the 1,378,980 shares of Common Stock beneficially owned by Trading Fund OS.

Partners, as the general partner of
BVF, BVF2, the investment manager of Trading Fund OS, and the sole member of Partners OS, may be deemed to beneficially own the
17,553,114 shares of Common Stock beneficially owned in the aggregate by BVF, BVF2, Trading Fund OS, and certain Partners managed
accounts (the “Partners Managed Accounts”), including 2,229,001 shares of Common Stock held in the Partners Managed
Accounts.

BVF Inc., as the general partner of
Partners, may be deemed to beneficially own the 17,553,114 shares of Common Stock beneficially owned by Partners.

Mr. Lampert, as a director and officer
of BVF Inc., may be deemed to beneficially own the 17,553,114 shares of Common Stock beneficially owned by BVF Inc.

The foregoing should not be construed
in and of itself as an admission by any Reporting Person as to beneficial ownership of any shares of Common Stock owned by another
Reporting Person. Partners OS disclaims beneficial ownership of the shares of Common Stock beneficially owned by Trading Fund OS.
Each of Partners, BVF Inc. and Mr. Lampert disclaims beneficial ownership of the shares of Common Stock beneficially owned by BVF,
BVF2, Trading Fund OS, and the Partners Managed Accounts, and the filing of this statement shall not be construed as an admission
that any such person or entity is the beneficial owner of any such securities.

The following percentages are based
on a denominator which is the sum of: (i) 71,171,551 shares of Common Stock outstanding as of July 20, 2017, as disclosed in the
Issuer’s Quarterly Report filed on Form 10-Q with the Securities and Exchange Commission on August 4, 2017, (ii) the 15,918,751
Shares of Common Stock issued by the Issuer pursuant to the Private Placement and (iii) certain of the 2,439,932 shares of Common
Stock underlying certain Warrants, as applicable.