Asia PR News

LONDON, June 30 /PRNewswire-AsiaNet/ –

Arrow Therapeutics today announced a deal with Novartis, involving the
development and commercial sale of its small molecule inhibitor A60444 for the
treatment of Respiratory Syncytial Virus. Under the terms of the agreement
Novartis will undertake most of the further development and all
commercialisation activity for the compound which is currently undergoing Phase
II clinical trials. All future work on the project will be funded by Novartis.

RSV is a major threat to the very young, the elderly and the
immuno-compromised and with no other effective treatment available represents a
major unmet medical need. Although best known as an infection in babies where
it causes severe bronchiolitis, a recent editorial in the New England Journal
of Medicine has also stressed its significant effects in the elderly.
Currently, the only widely used intervention is MedImmune’s monoclonal
antibody, Synagis’ which is used to prevent infection in high risk infants.
However, this antibody is used in a small percentage of babies and although it
is only effective given prior to infection (unlike a treatment therapy) it has
reached sales of ‘blockbuster’ proportions and proven the RSV market.

Under the terms of the deal Arrow will receive an upfront payment of $10
million in addition to milestone payments of up to $217 million for success in
the ongoing and future development and commercialisation of the product, and
royalties on product sales appropriate for a compound in Phase IIa trials.
Rights to back up compounds to A60444 are included in the deal plus a right of
first negotiation on follow-up compounds with different chemistry, currently
under development by Arrow.

Ken Powell CEO of Arrow said "A-60444 is a first-in-class product for the
treatment of RSV. This is an area of high unmet medical need, and one which is
gaining increasing recognition of its importance by the medical community. For
Arrow in particular, the deal with Novartis is a validation of both our model
and our R&D capability and I am very satisfied with the outcome".

Notes to Editors:
RSV is the cause of one-fifth of all lower respiratory tract infections
worldwide, and is increasingly recognised as representing a serious threat to
patient groups with poorly functioning or immature immune systems.
Hospitalisations arising from this virus result in substantial healthcare
costs. The only significant product currently sold for RSV is ‘Synagis’, an
expensive monoclonal antibody from MedImmune/Abbott, which is used for
prophylaxis in premature and other high risk infants only, leaving the major
part of the patient population untreated.

The main patient groups at risk are:

— Infants under 2 years, of whom 2% are hospitalised each year. There is
also growing evidence of a link between severe RSV in infancy and the
occurrence of recurrent wheezing and childhood asthma.

— Elderly adults

— Adults with chronic obstructive pulmonary disease (COPD) and
congestive heart failure.

— Immuno-compromised individuals.

A product able to access all these patient groups will undoubtedly have
huge market potential.

Arrow Therapeutics
Arrow Therapeutics was founded in 1998, and is focused exclusively on novel
anti-infective drug discovery and development. Based in central London with
around 60 employees, the product pipeline includes novel antibacterial and
antiviral lead and clinical compounds. Arrow’s lead project is a compound to
treat Respiratory Syncytial Virus (RSV) in Phase II clinical studies. The lead
compound from Arrow’s Hepatitis C project is planned to enter clinical
development in early 2006 and novel antibacterial compounds are at late lead
optimization stage.

Compounds will be licensed at stages between preclinical and Phase IIb
depending on the therapeutic area.

Seed funding of GBP1.5 million was provided by Unibio of London who also
invested in the first major funding round completed in July 2000 along with
GIMV Belgium (lead), Alta Partners USA, 3i Group London, TVM Munich, and NVM
Edinburgh which brought in GBP11.1 million. The same group provided a further
GBP7 million in January 2002. The latest funding round was completed in early
2004 raising over GBP23 million from the USA, Japan and Europe. Atlas Venture
is the now the lead investor.

SOURCE: Arrow Therapeutics Ltd.

CONTACT: Press:
Ken Powell,
CEO, Arrow Therapeutics,
+44-207-015-1002

Web site: http://www.arrowt.co.uk