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Bayer Healthcare, Biological Products (NC) Signs Development Deal For Longer-Acting Kogenate(R)
11/22/2004

RESEARCH TRIANGLE PARK, N.C., Nov. 22 /PRNewswire/ -- Bayer HealthCare, LLC, Biological Products (BP) division, announced today it has signed an exclusive, global technology license with Zilip-Pharma for the development and commercialization of a new, longer-acting Kogenate(R) product -- a product with the potential to shift current treatment paradigms in hemophilia and simplify the lives of thousands of patients around the world. The deal between Bayer and Zilip-Pharma involves the application of patented liposome technology developed by Zilip-Pharma and its affiliated companies over several years. Clinical results obtained by Zilip-Pharma suggest that a prolonged interval between bleeding episodes -- one week or more -- occurs when factor VIII attached to liposomes is administered to individuals with hemophilia A.

Upon achievement of key milestones, including successful clinical development and regulatory approvals in key regions, upfront and milestone payments from Bayer to Zilip-Pharma would total $100 million plus royalties from sales of the new product. The agreement covers applications of the liposome technology to the current Kogenate(R) recombinant factor VIII molecule, as well as other factor VIII molecules, which could be developed by Bayer in the future.

"A product with the potential to be dosed once weekly would be a major step forward in hemophilia care, improving convenience of administration and helping people live the lives they choose," said Joseph Akers, president, Bayer Biological Products. "Additionally, this is a major opportunity for us to significantly strengthen our marketplace position so we can continue providing the most advanced products, technologies, and services for the hemophilia community."

Through regular dialogue between patients and Bayer BP's scientists, it was recognized that a factor VIII product requiring less frequent infusions would represent a true breakthrough for people living with hemophilia. Based on this information, and Bayer BP's unwavering commitment to respond to unmet patient needs, Bayer supported studies with the liposome technology. "The results from early studies by the Zilip-Pharma group of companies, which included pilot clinical studies, demonstrated great promise for this cutting-edge technology leading to our partnership with them," said David Naveh, Bayer Biological Products' project champion for the partnership.

"A product allowing injections once weekly, or even less frequently, definitely represents a new treatment paradigm in hemophilia, and could offer very significant improvements in patients' lifestyles. Importantly, it also could help prevent the placement of long-term intravenous catheters for vascular access in heavily treated young boys with hemophilia," said Victor Blanchette, MA, MB, B Chir, FRCP, Chief, Division of Haematology/Oncology, Professor of Paediatrics, University of Toronto, The Hospital for Sick Children. "If successful, this next-generation Kogenate(R) product will be a very highly anticipated breakthrough for improving the lives of people living with hemophilia."

Mark Skinner, president of the World Federation of Hemophilia commented, "Individuals and their families have been seeking the development of treatment options that make life easier and reduce the burdens of living with hemophilia. Research leading to the availability of more efficacious products is highly desired and needed. The development of a once-weekly therapy would provide a dramatic therapeutic advance."

Zilip-Pharma's liposomal technology utilizes PEGylated liposomes free of biologicals, which have a longer half-life and have been used successfully with other approved products. Whereas conventional liposomes sometimes can be mistaken as foreign by the body's immune system, these liposomes represent a significant advance because they have a polyethylene glycol (PEG) coating that helps avoid detection by the immune system. The pilot clinical studies by the Zilip-Pharma group suggest that Kogenate(R) molecules attached to the surface of these liposomes can extend the interval between bleeding episodes requiring fewer treatments especially in prophylactic regimens.

"This is a great example of our scientists partnering with an innovative biotechnology company to pursue new ideas and technologies based on their understanding of unmet needs in the marketplace," said Michael Fournel, senior vice president, Research & Development, Bayer Biological Products. "We are anxious to begin clinical development studies that could lead to a cutting-edge, new-generation Kogenate(R) product with dosing once weekly or less in hemophilia A."

Clinical Trial Results

"In our multi-center, patient-blinded phase II trial with severe hemophilia A patients, the time to next bleed following injection of PEGylated liposomal Kogenate(R) was significantly prolonged. The results clearly show the potential for this treatment and we are very pleased that Bayer will undertake the development of the use of our technology within this area," said Robert Taub, founder of Zilip-Pharma.

Based on initial timelines for the project, Bayer and Zilip-Pharma hope that the next-generation Kogenate(R) could be launched in five years, pending continued positive clinical results, required regulatory reviews, and necessary license approvals.

About Kogenate(R) FS/ KOGENATE(R) Bayer

Kogenate(R) FS/KOGENATE(R) Bayer Antihemophilic Factor (Recombinant), Formulated with Sucrose, is a recombinant factor VIII treatment for hemophilia A that offers a convenient administration by utilizing a 2.5 mL diluent, as small as any diluent volume currently available among recombinant factor VIII products. Kogenate(R) FS/KOGENATE(R) Bayer does not use albumin in its purification or formulation, and includes a solvent/detergent viral inactivation step, thereby further reducing the potential risk of viral transmission. Kogenate(R) FS/KOGENATE(R) Bayer is manufactured at Bayer BP's state-of-the-art biotechnology facility in Berkeley, Calif.

About Hemophilia

Approximately 400,000 people around the world have hemophilia. Hemophilia is an inherited bleeding disorder characterized by prolonged or spontaneous bleeding, especially into the muscles, joints, or internal organs. The disease is caused by deficient or defective blood coagulation proteins, known as factor VIII or IX. The most common form of the disease is hemophilia A, or classic hemophilia, in which the clotting factor VIII is either deficient or defective. Hemophilia B is characterized by deficient or defective factor IX.

About Bayer HealthCare AG

Bayer HealthCare AG, a subgroup of Bayer AG with sales of approximately 8.9 billion Euro in 2003, is one of the world's leading, innovative companies in the health care and medical products industry. The company combines the global activities of the divisions Animal Health, Biological Products, Consumer Care, Diagnostics Professional Testing Systems and Diagnostics Self Testing Systems and Pharmaceuticals. 34,600 people are employed by Bayer HealthCare worldwide. Our aim is to discover and manufacture innovative products that will improve human and animal health worldwide. Our products enhance well-being and quality of life by diagnosing, preventing and treating disease.

Information about Bayer Biological Products Division can be found at http://www.bayerbiologicals.com/.

About Zilip-Pharma

Zilip-Pharma, a private Dutch biotechnology company, has developed a patented, platform technology, which has been shown to prolong the half-life and improve the biological efficacy of protein and peptide pharmaceuticals by formulating them with PEGylated liposomes. The development work is performed in Israel, Russia and other European countries. The proteins and peptides bind non-covalently and yet with high affinity to the external surface of the liposomes; the proteins and peptides maintain their biological activity. No change in the protein/peptide manufacturing process is required. Zilip-Pharma's goal is to partner with pharmaceutical and biotechnology companies to develop improvements of approved pharmaceutical products and thereby extend product franchises and enlarge product pipelines.

Forward-looking statements

This news release contains forward-looking statements based on current assumptions and forecasts made by Bayer Group management. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of the company, and the estimates given here. These factors include those discussed in our public reports filed with the Frankfurt Stock Exchange and with the U.S. Securities and Exchange Commission (including our Form 20-F). The company assumes no liability whatsoever to update these forward-looking statements or to conform them to future events or developments.

Bayer HealthCare, LLC

CONTACT: Tricia McKernan for Bayer BP, +1-919-316-6316, Fax -+1-919-316-6673, tricia.mckernan.b@bayer.com; or Larry Ellberger of HealthcareVentures Associates, Inc., of Livingston, New Jersey, +1-973-597-0080,larryellberger@healthcareva.com, for Zilip-Pharma



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