New Diabetes Research Contract With Merck KGaA And ChemGenex Pharmaceuticals Limited

MELBOURNE, Australia and MENLO PARK, Calif., Jan. 17 /PRNewswire-FirstCall/ -- ChemGenex Pharmaceuticals (ASX: CXS, Nasdaq: CXSP) has signed a new three year alliance agreement with its long-term pharmaceutical industry partner Merck KGaA of Darmstadt, Germany to provide pre-clinical support in the fields of diabetes, insulin resistance and complications through December 31, 2008.

Under the terms of the agreement, ChemGenex will receive a total retainer fee of approximately $A1 Million, with potential additional payments depending on the amount and type of pre-clinical support provided. The new agreement follows the successful completion of three research contracts in target discovery, and reflects the strong ongoing relationship between Merck KGaA and ChemGenex.

Chief Executive Officer of ChemGenex, Greg Collier PhD says that the new agreement signals an exciting stage for ChemGenex. “This new agreement is a strong endorsement by Merck of the value they see in ChemGenex’s diabetes expertise, and of our strong competitive position in this field. In addition, we are excited by the opportunity to internally progress the pre-clinical development of exciting targets such as SEPS1, and believe that new partnership opportunities will arise around several of our proprietary targets.”

Dr. Inge Lues, Executive Vice President of Pre-clinical R&D at Merck KGaA, says that the new agreement gives Merck access to unique capabilities in diabetes research. “We are very familiar with ChemGenex’s animal model and leading edge technical expertise and want to maintain access to these capabilities for pre-clinical development of a number of interesting potential small molecule therapeutics.”

About ChemGenex Pharmaceuticals Limited (www.chemgenex.com)

ChemGenex Pharmaceuticals is a pharmaceutical development company dedicated to improving the lives of patients by developing therapeutics in the areas of oncology, diabetes, obesity, and depression. ChemGenex harnesses the power of genomics for target discovery and validation, and in clinical trials to develop more individualized therapeutic outcomes. ChemGenex’s lead compound, Ceflatonin®, is currently in phase 2/3 clinical trials for leukemia and Quinamed® is in phase 2 clinical trials for prostate, breast and ovarian cancers. The company has a significant portfolio of anti-cancer, diabetes, obesity and depression programs, several of which have been partnered with international pharmaceutical companies. ChemGenex currently trades on the Australian Stock Exchange under the symbol “CXS” and on Nasdaq under the symbol “CXSP”.

About Merck KGaA (www.merck.de)

Merck KGaA of Darmstadt, Germany, is a global pharmaceutical and chemical company with sales of EUR 5.9 Billion in 2004, a history that began in 1668, and a future shaped by 28,900 employees in 54 countries. Its success is characterized by innovations from entrepreneurial employees. Merck’s operating activities come under the umbrella of Merck KGaA, in which the Merck family holds a 73% interest and free shareholders own the remaining 27%. The former U.S. subsidiary, Merck & Co., has been completely independent of the Merck Group since 1917.

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Source: ChemGenex Pharmaceuticals

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