AGT Announces Cross Border Merger Creating an Integrated Pharmaceutical Company with Two Phase II Compounds.

Business Editors/Health/Medical Writers

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MENLO PARK, Calif. & MELBOURNE, Australia--(BUSINESS WIRE)--April 27, 2004

AGT Biosciences Limited (ASX:AGT) of Melbourne, Australia and privately held ChemGenex Therapeutics, Inc. of Menlo Park, California, today announced that they have signed a merger agreement. The cross-border merger creates a new, genomics-driven pharmaceutical company with leading edge capabilities for drug discovery and development, as well as two drug candidates in Phase II human trials for cancer. The global pharmaceutical company will be called ChemGenex Pharmaceuticals and will have principal operations in Menlo Park, California and in Geelong, Australia. The company will also maintain its Center for Statistical Genomics in San Antonio, Texas.

ChemGenex Therapeutics is focused on the development of novel small molecule therapeutics for the treatment of cancer and related conditions. The company has built a portfolio of product candidates with distinct mechanisms of action for different tumor types, including two product candidates in Phase II clinical trials (Ceflatonin(TM) and Quinamed(TM)) and others in late-stage preclinical development. Ceflatonin(TM), the company's most advanced product, is undergoing Phase II investigation in hematological malignancies (chronic myelogenous leukemia and myelodysplastic syndrome), while Quinamed(TM) is being studied in solid tumors (prostate cancer, gastric cancer, ovarian cancer and colon cancer). ChemGenex utilizes proprietary chemical genomics and drug screening systems to identify agents affecting novel targets. Additionally, ChemGenex employs medicinal computational chemistry to evaluate a compound's suitability as a drug and proprietary formulation technology to maximize delivery and bioavailability.

"AGT Biosciences has been a leader in the discovery and validation of novel genetic targets in a number of disease areas, while ChemGenex has successfully applied genomics, informatics and other modern pharmaceutical technologies to the identification and development of novel drugs for the treatment of cancer," said Dr. Greg Collier, Chief Executive Officer of AGT Biosciences. "By combining forces, we create an extremely competitive company with strengths extending from basic research to drugs in advanced stages of clinical development." Dr. Collier will be CEO of the combined company.

"This merger creates an integrated biopharmaceutical company with strong discovery and development capabilities, a broad pipeline of compounds and validated targets addressed to major diseases, an established corporate partnership with a major pharmaceutical company in the area of diabetes and obesity, and experienced management," said Dr. Dennis Brown, President and CEO of ChemGenex Therapeutics. Dr. Brown has over 25 years of experience in applied cancer research and was previously a co-founder of Matrix Pharmaceutical, Inc. (which was acquired by Chiron Corporation in 2002). Dr. Brown will be President of the combined company.

Terms of the Merger Agreement

Under the terms of the merger agreement, AGT Biosciences, with major shareholders Charter Pacific Corporation (33%) Merck-Sante (9.9%), Queensland Investment Corporation (9.1%), will acquire all of the issued shares of ChemGenex Therapeutics through the issuance of approximately 28 million ordinary shares of AGT Biosciences to the shareholders of ChemGenex Therapeutics. The transaction is expected to close by mid June, 2004, subject to the approval of the shareholders of AGT Biosciences. AGT Biosciences intends to upgrade from the current level 1 to a level 2 ADR NASDAQ program for the combined entity as soon as practical. The New York-based investment bank Global Markets Capital Group, LLC advised AGT on the merger with ChemGenex.

About AGT BIOSCIENCES www.agtbiosciences.com:

AGT Biosciences Limited is a listed Australian biotechnology company with laboratories in Australia and the U.S. The company has significant capabilities in diabetes and obesity research and has a long term agreement with the European pharmaceutical company Merck Sante that has already been worth more that A$38 million. This research alliance has generated a substantial suite of intellectual property with 73 genes and proteins protected and four validated targets having been the subject of commercialization and license agreements. In addition to its human therapeutics business, AGT Biosciences also has business units that operate in the fields of diagnostics, animal therapeutics, OTC medications and fee-for-service research provision.

About CHEMGENEX THERAPEUTICS www.chemgenex.com:

ChemGenex Therapeutics is a Menlo Park, California based biopharmaceutical company focused on developing and marketing novel small molecule therapeutics for the treatment of cancer and related conditions. ChemGenex Therapeutics optimizes the development of small molecule therapeutics by using proprietary technologies from discovery through development to reduce risk and increase the likelihood of clinical success. Chemgenex Therapeutics' overall strategy is to exploit the growing understanding of cancer biology and the human genome to achieve targeted clinical development of next generation anti-cancer drugs. Its current product portfolio includes two product candidates in clinical trials and others in late-stage pre-clinical development. Quinamed(TM) (amonafide dihydrochloride), is currently undergoing Phase II clinical testing in solid tumors. Ceflatonin(TM) (homoharringtonine), is in Phase II trials with patient enrollment in chronic myeloid leukemia (CML) and myelodysplastic syndrome (MDS). Three other compounds, CGX-2101, CGX-6001B and CGX-273, are in late-stage pre-clinical development.

Safe Harbor:

Certain statements made herein that use the words "estimate," "project," "intend," "expect," "believe," and similar expressions are intended to identify forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks and uncertainties which could cause the actual results, performance or achievements of the company to be materially different from those which may be expressed or implied by such statements, including, among others, risks or uncertainties associated with the development of the company's technology, the ability to successfully market products in the clinical pipeline, the ability to advance promising therapeutics through clinical trials, the ability to establish our fully integrated technologies, the ability to enter into additional collaborations and strategic alliances and expand current collaborations and obtain milestone payments, the suitability of internally discovered genes for drug development, the ability of the company to meet its financial requirements, the ability of the company to protect its proprietary technology, potential limitations on the company's technology, the market for the company's products, government regulation in Australia and the United States, changes in tax and other laws, changes in competition and the loss of key personnel. These statements are based on our management's current expectations and are subject to a number of uncertainties that could change the results described in the forward looking statements. Investors should be aware that there are no assurances that results will not differ from those projected.