Asia PR News

SYDNEY, July 31 /Medianet International-AsiaNet/ –

Two leading life science VCs to invest US$3m in Neuren

Key Points:

– Acquisition of a compound - Motiva - with successful safety and Phase II
efficacy data in human clinical trials

– US Investigational New Drug ("IND") application currently active
Strengthens Neuren’s position as key player in the CNS field

– Two leading life science VCs to invest US$3 million in Neuren

– Neuren will have one Phase III and three Phase II studies in 2008, with
results expected in early 2009

Neuren Pharmaceuticals (ASX: NEU) today announced that it will acquire
Hamilton Pharmaceuticals ("Hamilton") in a transaction that will provide Neuren
a late stage compound with proven human efficacy and add three leading life
science investors as shareholders in Neuren. The acquisition represents a major
milestone for Neuren and will position the Company as a key player in the
central nervous system ("CNS") field, specialising in cognitive and
psychological effects of CNS injury.

Under the binding term sheet, the acquisition is to be implemented using
Neuren scrip only, with no cash payment to be made by Neuren. Neuren will
acquire 100% of Hamilton, whose principal asset is Motiva, in exchange for
US$4.4 million in Neuren ordinary shares at the average closing share price for
the last five trading days (the "Purchase Share Price") prior to today’s
announcement. Two Hamilton investors, Vivo Ventures and CNF Investments, will
also invest US$3 million into Neuren.

In addition, contingent Motiva related milestones to Hamilton are as follows:

- Successful completion of Phase II - US$0.5 million in warrants to purchase
Neuren ordinary shares at the Purchase Share Price

- Initiation of a Phase III pivotal study - US$0.5 million in warrants to
purchase Neuren ordinary shares at the Purchase Share Price

- First filing of a New Drug Application ("NDA") or equivalent - US$1 million
of Neuren ordinary shares at the then market share price when the milestone is
reached

- First approval of NDA or equivalent - US$2 million of Neuren ordinary shares
at the then market share price when the milestone is reached

The three major venture capital investors from Hamilton, Vivo Ventures of
Palo Alto, California, CNF Investments of Bethesda, Maryland and Index Ventures
of Geneva, Switzerland, will become shareholders in Neuren through the
transaction. These companies are leading life sciences investors with funds of
more than US$2 billion under combined management. The managers of these funds
have a strong focus and experience in CNS drug development.

Upon the closing, Vivo Ventures and CNF Investments will invest US$3
million in Neuren by way of a convertible note which will convert to ordinary
shares on the same terms provided to investors in the next major fundraising.

Hamilton shareholders have unanimously approved the acquisition, and
Neuren will seek approval from its own shareholders prior to completion of the
transaction. The definitive legal agreement is being prepared. Ongoing
operating costs for Hamilton are negligible and Neuren will not be retaining
any Hamilton management.

Through the acquisition, Neuren will obtain a Phase IIb compound - Motiva
- which is being developed for psychological and cognitive disorders resulting
from stroke, traumatic brain injury, Alzheimer’s and Parkinson’s disease. The
compound already has proven human safety and efficacy in 1,700 patients.
Exclusive rights to develop and commercialise Motiva intellectual property in
the US and EU were licensed by Hamilton from Daiichi Pharmaceutical Company in
2004.

Motiva’s mode of action increases neurotransmitter concentrations in the
cortex of the brain. The drug has clinical efficacy signals in post-stroke
depression (see appendix for details). This class of compounds, called acetams,
includes approved drugs with sales in excess of US$700 million in the first
half of 2007, including levetiracetam (Keppra, UCB Pharma) and piracetam
(Nootropil, UCB Pharma). Motiva is protected by more than 40 issued patents,
three of which have issued in the US. The broad range of activity associated
with increased concentrations of cortical neurotransmitters has potential
applicability to a number of CNS indications.

Motiva has been studied in two randomized clinical trials (RCT) which
showed clinically and statistically significant efficacy of the drug. In 2006,
a third trial in post-stroke patients was suspended due to poor Contract
Research Organisation ("CRO") execution. Motiva’s approved IND application from
the US Food and Drug Administration remains open and there are sufficient
quantities of Motiva available to complete a Phase II trial.

Neuren intends to conduct a larger Phase II trial of Motiva with a broader
range of endpoints and tighter patient attributes in 2008. Neuren will thereby
be conducting one Phase III trial and three Phase II trials in 2008, all
focusing on cognitive and psychological effects of acute CNS injury, with
results expected by early 2009.

Commenting on the pending acquisition, David Clarke, Neuren’s CEO and
Managing Director, said: "This is a major step forward in Neuren’s strategic
development. It adds an extremely promising compound to our portfolio and, at
the same time, significant representation and commitment by world class life
sciences investors. This transaction confirms Neuren’s intent to be a
significant player in the CNS sector of the global biotechnology industry."

Mr. Robert Flanagan, a managing partner of CNF Investments and Board
Member of Hamilton Pharmaceuticals, said: "We are pleased to be forming this
relationship with Neuren. Neuren clearly brings the capabilities and commitment
not only to develop Motiva but also to maximise the value of their promising
pipeline. We look forward to a productive and exciting association."

About Neuren Pharmaceuticals
Neuren Pharmaceuticals (ASX: NEU) is a biopharmaceutical company developing
novel therapeutics in the fields of brain injury and diseases and metabolic
disorders. The Neuren portfolio consists of six product families, targeting
markets with large unmet needs and limited competition. Neuren has three lead
candidates, Glypromate and NNZ-2566, presently in clinical trials to treat a
range of acute neurological conditions, and NNZ-2591 in preclinical development
for Parkinson’s and other chronic conditions. Neuren has commercial and
development partnerships, including with the U.S. Army Walter Reed Army
Institute of Research, Metabolic Pharmaceuticals, UCLA Medical Center and the
National Trauma Research Institute in Melbourne.

For more information, please visit Neuren’s website at www.neurenpharma.com

Contact details:
Neuren
David Clarke
CEO
T: 1 800 259 181 (Australia)
T: +64 9 529 3942 (NZ)
M: +64 21 988 052

Media and investor relations
Rebecca Piercy
Buchan Consulting

T: +61 2 9237 2800
M: +61 422 916 422

SOURCE: Neuren Pharmaceuticals