13D Filing: James E. Flynn and Nivalis Therapeutics Inc. (NVLS)

(5)       Deerfield
Private Design International

Sole power to vote or direct the vote: 0

Shared power to vote or direct the vote:
647,152

Sole power to dispose or to direct the disposition:
0

Shared power to dispose or direct the disposition:
647,152

(6)       Deerfield
Private Design II

Sole power to vote or direct the vote: 0

Shared power to vote or direct the vote:
726,242

Sole power to dispose or to direct the disposition:
0

Shared power to dispose or direct the disposition:
726,242

(7)       Deerfield
Private Design International II

Sole power to vote or direct the vote: 0

Shared power to vote or direct the vote:
832,216

Sole power to dispose or to direct the disposition:
0

Shared power to dispose or direct the disposition:
832,216

(8)       Flynn

Sole power to vote or direct the vote: 0

Shared power to vote or direct the vote:
3,741,639

Sole power to dispose or to direct the disposition:
0

Shared power to dispose or direct the disposition:
3,741,639

Flynn is the sole member of the general
partner of each of Deerfield Mgmt and Deerfield Management. Deerfield Mgmt is the general partner, and Deerfield Management is
the investment advisor, of Deerfield Special Situations Fund, Deerfield Private Design, Deerfield Private Design International,
Deerfield Private Design II and Deerfield Private Design International II. Pursuant to an arrangement between Deerfield Management
and Furst, for so long as Furst is employed by Deerfield Management, any compensation that Furst receives from the Issuer is for
the economic benefit of Deerfield Management and must be transferred to Deerfield Management, for no consideration, subject to
applicable restrictions on transfer. See Item 6 for additional information regarding such arrangement.

(c) On September 12, 2016, the Issuer granted
to Furst, a partner in Deerfield Management and a director of the Issuer, the September 2016 Option. The September 2016 Option
vests in 12 equal installments, commencing on October 12, 2016, and is exercisable for $7.77 per share.

Item 6. Contracts, Arrangements, Understandings
or Relationships With Respect to Securities of the Issuer.

Item 6 is hereby amended by adding the
following:

The information set forth in Item 4 with
respect to the Support Agreement is incorporated by reference herein.