UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

SCHEDULE 14A

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Securities Exchange Act of 1934

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Genentech, Inc.

(Name of Registrant as Specified in its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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11/15/2006

©

2006, Genentech

Genentech:  An Overview

David Ebersman, Executive Vice President and

Chief Financial Officer, Genentech

November 15, 2006

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2006, Genentech

Meeting Agenda

1)

Introduction to Genentech

David Ebersman

2)

Transition Planning/Process

Ashraf Hanna

3)

Employee Related Information

Brian Muma

4)

Next steps

David Ebersman

5)

Q&A

All

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2006, Genentech

Founding of Genentech

•

Genentech was founded in 1976 by venture capitalist Robert

A. Swanson and biochemist Dr. Herbert W. Boyer.  In the

early 1970s, Boyer and geneticist Stanley Cohen pioneered a

new scientific field called recombinant DNA technology 

•

After hearing about the breakthrough, Swanson placed a call

to Boyer and requested a short meeting. Swanson's

enthusiasm for the technology and his faith in its commercial

viability were contagious, and the meeting extended from 10

minutes to three hours.  By its conclusion, Genentech was

born

•

Though they faced skepticism from both the academic and

business communities, they forged ahead with their idea.

Within a few short years, they successfully demonstrated the

viability of using recombinant DNA technology to develop

products with practical applications

The First Biotech Company

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2006, Genentech

Genentech’s Mission

•

Our mission is to be the leading

biotechnology company, using human

genetic information to discover, develop,

manufacture and commercialize

biotherapeutics that address significant

unmet medical needs

•

We commit ourselves to high standards of

integrity in contributing to the best interests

of patients, the medical profession, our

employees and our communities; and to

seeking significant returns to our

stockholders based on the continual pursuit

of scientific and operational excellence

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In 1998 we licensed U.S. marketing and development rights to interferon gamma, including Actimmune, to

Connetics Corporation. Thereafter, Connetics sublicensed, then later assigned, all of its rights to InterMune

Pharmaceuticals, Inc. Protropin manufacturing was discontinued at the end of 2002. Nutropin Depot

commercialization was discontinued in June 2004.

Developing Therapies For Unmet Medical Needs

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Genentech: A Closer Look

•

More than 10,000 employees

•

$6.6 billion in total operating revenues (2005)

•

World leader in biotech manufacturing,

with more FDA-approved manufacturing

capacity for the production of biotech medicines than any other company

•

Headquarters in South San Francisco; sites in Vacaville and Oceanside,

California, Oregon and Kentucky

•

Leading provider of anti-tumor therapeutics in the United States

•

Broad and robust pipeline of more than 40 projects with a focus on

oncology, immunology and disorders of tissue growth and repair

•

10 FDA Approvals since the beginning of 2004; two pending

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2006, Genentech

At Our Core, We are a Science Company

Founders Research Center

•

Single largest biotechnology

research facility in the world

•

500,000+ square feet of

research space

Scientific Leadership

•

Ranked

as

the

“top

employer

and

most

admired

company

in

biotech

and

pharma”

by

Science

Magazine

for

all

five

years

that

Science

has

conducted

survey

•

Focus on novel pathways involved in complex diseases

•

More than 700 scientists with expertise in molecular biology,

protein chemistry, bioinformatics and physiology

•

Peer-reviewed publications encouraged

•

Secured approximately 6,100 current, non-expired patents worldwide,

with 5,400 patent applications pending worldwide

•

Discretionary research time allowed

•

More than 75 Postdoctoral Fellows

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Manufacturing

•

Genentech is a world leader in biotech

manufacturing, with more FDA-approved

manufacturing capacity for the production of

biotech medicines than any other company

•

Four facilities:  South San Francisco, CA;

Vacaville, CA and Oceanside, CA and Porriño,

Spain

•

We believe we have the right plans in place to

meet the growing demand for our products:

•

Oceanside facility purchased from Biogen Idec in 2005

•

Option to purchase facility in Singapore

•

Working with Lonza, Wyeth and Novartis

•

Process yield improvements for Rituxan and Avastin

•

New capacity coming online for bulk and

filling/packaging

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Why Are We Interested in Tanox?

•

Genentech and Tanox have been collaborating since 1996 and received

FDA approval of Xolair for allergic asthma in 2003

•

Our belief in Xolair and IgE inhibition as an important way to treat

patients, and as an area of great potential growth

•

We expect to grow the Xolair market by increasing patients treated,

adding new indications, formulations and second generation molecules

•

We are interested in several programs in the Tanox pipeline as they are

well aligned with our current pipeline in that they investigate novel targets in

diseases that would allow us to potentially expand therapeutic options for

patients:

•

Anti-IL13 Mab for asthma

•

Anti-Factor-D Mab for Dry AMD

•

Anti-CD4 for HIV

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Transition Planning and

Process

Ashraf Hanna, Vice President of Alliance

Management and Pipeline Planning Support

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2006, Genentech

Tanox

History and Milestones

Tse Wen & Nancy Chang

found Tanox

Project partnered

with Novartis and

later Genentech

Pipeline

growth

Settlement

of issues w/

GNE and Novartis

IgE patented

Largest IPO

in biotech history

Acquisition

by Genentech

1986

1994

1996

2000

2004

2006

Xolair

launch

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Key Items to be Addressed

•

Which R&D programs does Genentech want to take forward?  (e.g. Should we develop

the anti-CD4 program or partner with a company with more HIV expertise? )

•

Plan: Complete detailed review of each project in research development so that

Genentech’s internal committee can make final decisions.

•

What resources are required to integrate Tanox effectively if/when transaction closes?

•

Plan:

Complete

detailed

analysis

and

then

GNE’s

Portfolio

Planning

Committee

(PPC)

and Executive Committee (EC) will decide

•

What will be the status of the Houston, San Diego and Shanghai sites?

•

Plan: The EC and transition team members will review  current operations and then make

a decision.  Timeframes for the decisions TBD, but will be communicated once a date is

known

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Transition Process Will Be Organized Around Four Areas

EC / Legal

EC

Product Portfolio

Committee

Research Review

Committee

EC / PROP

Executive Team

Decision

maker

Feb. 28, 2007

Feb. 28, 2007

Jan. 31, 2007

Feb 28, 2007

3.Recommend

-ation

Feb 10, 2007

Feb. 10, 2007

Jan. 31, 2007

Jan 31, 2007

2. Evaluation

Number of

contracts; Rights

and obligations of

each

Number of

employees by

functional area

Number and

value of R&D

programs

Number, location,

and capability of

facility

1. Assessment

Contracts

HR

Change

management

R&D Programs

Facilities/ Property

Process Summary

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Genentech Transition Team

Ashraf Hanna,

Team Leader

Mark Asbury

Leigh Morgan

Charles Calderaro

Sean Bohen

Andy Chan

Neil

Cohen

Contracts

R&D

HR

Facilities/

Property

Communi

cation

Ray Sanchez-

Pescadore,

Project Manager

Brian Muma

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2006, Genentech

What Does This Mean For You?

•

We encourage continued focus on your current efforts to bring important new

medicines to patients, as this is in everyone’s best interest

•

While we fully expect the deal to go through, we aren’t there yet

•

Your current management continues to run the company until close

•

Once the GNE and Tanox transition teams are up and running, more

detailed information will be available on next steps, key milestones, etc.

•

Most importantly, we recognize that this is an uncertain time for Tanox

employees.   Consistent with our values, our intent is to treat Tanox

employees with the same respect & integrity that we treat our own employees

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Potential Paths Forward for Tanox Employees

•

Severance package

•

Outplacement

counseling services

•

Retention bonus

(details to be

determined)

•

Severance package

•

Outplacement

counseling services

•

Same

benefits/compensation

package as any

Genentech employee

•

Relocation support (if

necessary/applicable)

Not offered transition

or permanent position

Tech Transfer

Transition team

Retained by

Genentech

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2006, Genentech

Employee Related

Information

Brian Muma, Senior Director of Compensation

Benefits and Services

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©

2006, Genentech

What Does This Mean For You?

•

100% accelerated vesting of all outstanding unvested options paid out in cash

upon close (equal to the difference between $20 and the stock option exercise

price less applicable withholding taxes)

•

Payout of full 401k balance including accelerated vesting on unvested balance

that can be paid in lump sum, less taxes, or rolled over to a qualified plan like an

IRA

•

Employees encouraged to apply for existing open GNE positions for which they

qualify --

however, we cannot hire prior to close

•

No decision made yet whether to maintain R&D presence in Houston,

Shanghai, and/or manufacturing presence in San Diego

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Severance Details --

What is known

•

The program will include a base severance for employees who will not be

retained that takes into consideration both level and tenure, with maximum

severance pay of 8 months salary for any employee

•

Associate Director and above will be eligible for 5 months salary, plus

COBRA benefits for 5 months paid for by Genentech

•

Employees below Associate Director will receive 3 months salary, plus

COBRA benefits for 3 months paid for by Genentech

•

In addition to minimum severance based on level, the program will

provide an additional 2 weeks salary for every year of work

•

Partial years are pro-rated

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Next Steps

David Ebersman

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2006, Genentech

Decisions Yet to be Determined

•

Future plans for Tanox’s pipeline

•

Future plans for Tanox’s sites

•

Future status of employees

•

Who will be retained

•

How/when decisions will be made after close; however, our intent

is

for decisions to be made as quickly and with as much transparency

as possible

•

Where retained employees will be located

•

Details of post-close integration and timeline

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2006, Genentech

Next Steps

Today:

•

Small functional meetings with Genentech and Tanox management

This week:

•

Visit to San Diego facility by Genentech management

Next few months:

•

Additional site visits to establish post-close integration plans

•

Deal not closed until at least Q1’07; Tanox remains an independent

company until the deal closes.  It is important to stay focused and keep

moving projects forward during this time:

•

Tanox shareholder vote

•

Hart-Scott-Rodino

submission and review

•

Review of deal by Federal Trade Commission

•

Transition team established

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2006, Genentech

Thank You

Thank You

Page 24

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2006, Genentech

Q&A Session

This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, among other things, our expectations regarding the closing of the acquisition and the integration of the operations of Tanox, our belief that we have the right plans in place to meet future demand for our products, our belief regarding the future growth and profitability of Xolair and anti-IgE inhibition products, our future product development plans (including anti-IL 13 Mab for asthma, anti-Factor D Mab for dry AMD and anti-CD4 for HIV), our expectations regarding the timing of our evaluations and decisions for transition plans, and the timing of and actual severance payment amounts for Tanox employees. Actual results could differ materially. Among other things, the transaction and its timing could be affected or prevented by failure of certain closing conditions to occur, including FTC or other regulatory actions or delays; integration of the Tanox business (including the timing of our decisions regarding such integration) could be affected by failures in our due diligence review of the Tanox business and failure to retain certain key employees; growth and profitability of our asthma and anti-IgE business (including Xolair) could be affected by adverse market conditions, increased competition, delay or failure of clinical programs, and safety or manufacturing issues; future development plans may be affected by changes in our corporate strategy, increased competition, regulatory actions or delays, unsuccessful clinical trials or third party intellectual property rights; Xolair clinical trials could be affected by a number of factors including unexpected safety, efficacy or manufacturing issues, additional time requirements for data analysis and FDA actions or delays; achieving sales revenue consistent with internal forecasts, unexpected expenses such as litigation or legal settlement expenses, changes in tax rules, adverse market conditions, increased competition, regulatory actions or delays; and the severance described in this presentation will be subject to other terms and conditions set forth in the severance plan established by Genentech (including the execution of a release by each eligible employee). Please refer to Genentech’s periodic reports filed with the Securities and Exchange Commission. Such reports contain and identify important factors that could cause actual results to differ materially from those contained in our forward-looking statements. All such risk factors, including those found in our most recent Form 10-Q, are incorporated by reference into this transcript. We undertake no obligation to update or revise any forward-looking statements in the future.