That is a stored procedure that is shipped with .NET 3.0 (workflow part).
Make sure you have installed .NET 3.0 on your machine. You can manually install the workflow schema/logic on your existing episerver db by running C:/WINDOWS/Microsoft.NET/Framework/v3.0/Windows Workflow Foundation/SQL/EN/SqlPersistenceService_Schema.sql and C:/WINDOWS/Microsoft.NET/Framework/v3.0/Windows Workflow Foundation/SQL/EN/SqlPersistenceService_Logic.sql (that is the script the installer runs)
Make sure you have installed .NET 3.0 on your machine. You can manually install the workflow schema/logic on your existing episerver db by running C:/WINDOWS/Microsoft.NET/Framework/v3.0/Windows Workflow Foundation/SQL/EN/SqlPersistenceService_Schema.sql and C:/WINDOWS/Microsoft.NET/Framework/v3.0/Windows Workflow Foundation/SQL/EN/SqlPersistenceService_Logic.sql (that is the script the installer runs)