Napo Pharmaceuticals, Inc. Completes Feasibility Assessment For Chronic Diarrhoea In People Living With HIV/AIDS (CRO-HIV)

SOUTH SAN FRANCISCO, Calif., Dec. 20 /PRNewswire-FirstCall/ -- Napo Pharmaceuticals, Inc., , which focuses on the development and commercialisation of proprietary pharmaceuticals for the global marketplace in collaboration with local partners, announces that it has completed a feasibility assessment at four U.S. investigative sites in preparation for a phase 3 pivotal trial of crofelemer for chronic diarrhoea in people living with HIV/AIDS (CRO-HIV).

The objectives of the Institutional Review Board-approved study were i) to estimate potential enrolment rates using patient inclusion and exclusion criteria resembling those to be employed in the phase 3 CRO-HIV trial; ii) to assess patient compliance by completing a daily diarrhoea symptom diary; and, iii) to assess the ability of patients to abstain from medications prohibited by the protocol, including concomitant anti-diarrhoea medications. Fifty-five HIV-infected patients with chronic diarrhoea, who are now potential candidates for the Phase 3 CRO-HIV study, were enrolled within three months at four US sites, faster than expected.

The FDA agreed with the overall proposed design of a three arm classical Phase 3 trial design in May 2004. Based on recent clinical and pre-clinical data generated by the Company, Napo has initiated a Special Protocol Assessment ("SPA") with the FDA to obtain their agreement to study an additional and lower dose of 125 mg twice daily crofelemer, utilizing a novel two stage design. The Company anticipates the protocol design to be finalised at a meeting with the FDA on 16 January 2007. The first dosing in the Phase 3 trial is planned to commence in Q1 2007. Clinical data show crofelemer to be generally well-tolerated in clinical trials involving 1500 patients and the product has received fast-track designation from the FDA.

Commenting on this announcement, Lisa A. Conte, Napo's Chief Executive Officer, said "The company feels it is important to understand the lowest dose at which CRO-HIV can provide efficacy to optimize commercial return and benefit to patients. The rapid enrollment of the study and our recent work with HIV community leaders and advocates bode well for predicting enrollment timelines and continued planning for our target launch of CRO-HIV by mid- 2008."

"Aside from very specific conditions, such as traveller's diarrhoea, there has been no drug approved by FDA for the treatment of diarrhoea in almost 30 years," said Dr. Scott Harris, Napo's VP, Clinical Affairs and Chief Medical Officer. "Addressing the chronic needs in the HIV/AIDS population is a medically important first indication for crofelemer. There is published data that diarrhoea can interfere with absorption of anti-retroviral therapy, potentially leading to emergence of resistant viral strains."

Dr. Harris and Dr. Mark Longer, VP of Project and Program Planning recently joined Napo's executive staff and are leading the team responsible for the implementation of this trial. Napo's President and Chief Scientific Officer, Dr. Barry Quart, will be leaving the Company at the end of the year but will continue to provide scientific advisory services for continuity purposes. Dr. Quart is the Principal Investigator on Napo's recent cholera

grant for the development of an improved formulation of crofelemer for the treatment of cholera and he will continue in that role.

About Napo

Napo Pharmaceuticals Inc. focuses on the development and commercialisation of proprietary pharmaceuticals for the global marketplace in collaboration with local partners. Napo was founded in November 2001, and is based in California, USA with a subsidiary in Mumbai, India.

Napo's late-stage proprietary gastro-intestinal compound, crofelemer, is in various stages of clinical development for four distinct product indications, including a late-stage Phase 3 program:

-- CRO-HIV for AIDS diarrhoea, Phase 3 -- CRO-IBS for diarrhoea irritable bowel syndrome ("D-IBS"), Phase 2 -- CRO-ID for acute infectious diarrhoea (including cholera), Phase 2 -- CRO-PED for paediatric diarrhoea, Phase 1 The FDA has granted fast-track status to CRO-IBS and CRO-HIV.

Crofelemer, a proprietary patented agent, is extracted from Croton lechleri, a medicinal plant which can be sustainably harvested from several countries in South America. Napo also plans to develop a pre-clinical product, NP-500, for the treatment of insulin resistant diseases of Type II diabetes and Syndrome X. Napo also has a plant library of approximately 2,300 medicinal plants from tropical regions and Napo has entered its first screening relationship associated with this collection. Currently, products are based on the chemical and biological diversity derived from plants with medicinal properties, but future products may be in-licensed from other sources. Napo has partnerships with Trine Pharmaceuticals, Inc. of the United States of America; Glenmark Pharmaceuticals Limited of India; and AsiaPharm Group Ltd. of China. For more information please visit http://www.napopharma.com

Special Protocol Assessment

The FDA's SPA process was implemented under the Prescription Drug User Fee Act (PDUFA) in November 1997. The FDA agreed to specific performance goals for special protocol assessment that apply to certain types of pivotal efficacy trials. To use this process, companies planning clinical trials designed to support efficacy claims submit a study protocol, as well as related questions. The FDA may then review and agree to the protocol design, execution and analyses and issue a special protocol letter to that effect. Once the FDA agrees in writing to a protocol reviewed under this process, the assessment should be considered binding on the review division of the FDA as long as the protocol is followed, unless substantial scientific issues essential to determining the safety or efficacy of the drug are identified after the testing has begun, the information provided by the sponsor is found to be false or to omit relevant facts, or the FDA and the sponsor agree to modifications.

For more information please contact: Napo Pharmaceuticals, Inc Lisa Conte, Chief Executive Officer (001) + 650 616 1902 Charles Thompson, Chief Financial Officer (001) + 650 616 1903 Buchanan Communications 020 7466 5000 Tim Anderson, Mary-Jane Johnson Noonan Russo David Schull 858 546 4810 Nomura Code Securities Limited 020 7776 1204 Juliet Thompson

Napo Pharmaceuticals Inc.

CONTACT: Lisa Conte, Chief Executive Officer, +650-616-1902, or CharlesThompson, Chief Financial Officer, +650-616-1903, both of NapoPharmaceuticals, Inc.; or Tim Anderson or Mary-Jane Johnson, both ofBuchanan Communications, +44-20-7466-5000; or David Schull of Noonan Russo,+1-858-546-4810; or Juliet Thompson of Nomura Code Securities Limited,+44-20-7776-1204

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