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

As of October
16, 2017 (i) BVF beneficially owned approximately 10.0% of the outstanding shares of Common Stock, including shares of Common Stock
issuable upon the exercise of certain Warrants, (ii) BVF2 beneficially owned approximately 5.8% of the outstanding shares of Common
Stock, including shares of Common Stock issuable upon the exercise of certain Warrants, (iii) Trading Fund OS beneficially owned
approximately 1.6% of the outstanding shares of Common Stock, (iv) Partners OS may be deemed to beneficially own approximately
1.6% of the outstanding shares of Common Stock, and (v) each of Partners, BVF Inc. and Mr. Lampert may be deemed to beneficially
own approximately 19.9% of the outstanding shares of Common Stock (approximately 2.5% of which is held in the Partners Managed
Accounts).

(c)

Number of shares as to which such person has:

(i)

Sole power to vote or to direct the vote

See Cover Pages Items 5-9.

(ii)

Shared power to vote or to direct the vote

See Cover Pages Items 5-9.

(iii)

Sole power to dispose or to direct the disposition of

See Cover Pages Items 5-9.

(iv)

Shared power to dispose or to direct the disposition of

See Cover Pages Items 5-9.

Item 5.

Ownership of Five Percent or Less of a Class.

Not Applicable.

Item 6.

Ownership of More than Five Percent on Behalf of Another Person.

Partners, BVF Inc. and Mr. Lampert
share voting and dispositive power over the shares of Common Stock beneficially owned by BVF, BVF2, Trading Fund OS, and the Partners
Managed Accounts.

Item 7.

Identification and Classification of the Subsidiary That Acquired the Security Being Reported on by the Parent Holding Company or Control Person.

Not Applicable.

Item 8.

Identification and Classification of Members of the Group.

See Exhibit 99.1 to Amendment No. 3
to the Schedule 13G filed with the Securities and Exchange Commission on February 16, 2016.

Item 9.

Notice of Dissolution of Group.

Not Applicable.