SRI International Partners With AuricX Pharmaceuticals on Oral Formulations of Vancomycin Antibiotic

MENLO PARK, CA--(Marketwire - January 12, 2009) - SRI International, an independent, nonprofit research and development organization, announced today a licensing and research agreement with AuricX Pharmaceuticals. Under the terms of the agreement, AuricX gained rights from SRI to oral formulations of the antibiotic vancomycin. SRI received upfront payments and will be eligible for success-based milestones and royalties on sales. Terms have not been disclosed.

Once considered the "drug of last resort," vancomycin is now commonly used in hospital settings for the treatment of systemic infections caused by antibiotic-resistant Gram-positive bacteria such as methicillin-resistant Staphylococcus aureus (MRSA) and Staphylococcus epidermidis (MRSE). These resistant bacteria are frequently the cause of hospital-acquired infections and are increasingly found in infections occurring in the community, posing a serious health problem to the general public.

According to IMS Health, sales for antibiotics designed to treat serious infections caused by Gram-positive bacteria exceeded $1 billion in U.S. sales in 2007. Vancomycin sales were more than $380 million and accounted for 85 percent of the courses of therapy prescribed.

"Improving the oral absorption of vancomycin has the potential to improve the quality of patient care and to reduce overall healthcare costs," said Gita Shankar, Ph.D., Director of Formulations R&D at SRI and an inventor on the patent applications. "An oral form of vancomycin will allow patients to leave the hospital earlier and to continue their treatment at home, where they will not need to maintain an intravenous line."

Early proof-of-concept work at SRI to develop the orally bioavailable vancomycin formulation was funded by a contract from the National Institute of Allergy and Infectious Diseases, part of the National Institutes of Health. Under the research agreement with AuricX, SRI will complete its formulation studies and fully optimize the oral bioavailability of vancomycin.

"We are pleased to be partnering with SRI on this innovative solution to address a known clinical need," said Eric Nicolaides, CEO of AuricX and Managing Partner of Wildcat Venture Management, the venture firm which launched AuricX in 2006. "The addition of a breakthrough formulation for one of the world's best known antibiotics is a welcome addition to AuricX's pipeline. We look forward to working with SRI to complete this work and we are committed to getting this product into the clinic and to those in need as quickly as possible."

"This agreement demonstrates the breadth of SRI's drug discovery and development programs," said Edward Spack, Ph.D., senior director of business development, SRI Biosciences Division. "In addition to licensing our own proprietary drugs, we work with clients and partners to solve a wide range of formulation and delivery challenges, in the present case expanding the potential impact of a currently approved drug. We look forward to working with AuricX to develop a formulation that will permit the oral treatment of resistant Gram-positive infections in a more economical and practical manner."

About AuricX Pharmaceuticals

AuricX Pharmaceuticals (www.auricx.com) is a pharmaceutical development company based in Houston. AuricX is focused on the development and commercialization of novel anti-infectives to treat infections arising from Staphylococcus Aureus (S. aureus), Methicillin-Resistant Staphylococcus Aureus (MRSA) and other difficult to treat pathogens. In addition to commercializing the Oral Vancomycin, AuricX is commercializing a repurposed clinical trial stage drug which is being developed to treat S. Aureus infections. AuricX was formed in 2006 and is managed by Chicago-based Wildcat Venture Management (www.wildcatventure.com).

About SRI's Biosciences Division

SRI International's Biosciences Division teams with pharmaceutical and biotechnology companies, academia, foundations, and government agencies to solve important problems in global health. SRI Biosciences conducts basic research, drug discovery, and drug development, including contract research. SRI has all of the resources necessary to take R&D programs from "idea to IND"™ -- from initial discovery to investigational new drug applications to start human clinical trials -- and specializes in cancer, immunology and inflammation, infectious disease, and neuroscience research. To date, SRI has helped advance more than 100 drugs into clinical trials, including a number of its own discoveries, several of which have reached the market. SRI is also working at the nexus of science and technology to create new technology platforms for the next generation of drug discovery and development in areas such as diagnostics, drug delivery, medical devices, and systems biology.

About SRI International

Silicon Valley-based SRI International (www.sri.com) is one of the world's leading independent research and technology development organizations. SRI, which was founded by Stanford University as Stanford Research Institute in 1946 and became independent in 1970, has been meeting the strategic needs of clients and partners for more than 60 years. Perhaps best known for its invention of the computer mouse and interactive computing, SRI has also been responsible for major advances in networking and communications, robotics, drug discovery and development, advanced materials, atmospheric research, education research, economic development, national security, and more. The nonprofit institute performs sponsored research and development for government agencies, businesses, and foundations. SRI also licenses its technologies, forms strategic alliances, and creates spin-off companies. In 2007, SRI's consolidated revenues, including its wholly owned for-profit subsidiary, Sarnoff Corporation, were approximately $450 million.