Altus Pharmaceuticals Reports Third Quarter 2008 Financial Results.

CAMBRIDGE, Mass. -- Altus Pharmaceuticals Inc. (NASDAQ: ALTU), a biopharmaceutical company focused on oral and injectable protein therapeutics for gastrointestinal and metabolic disorders, today reported financial results for the quarter ended September 30, 2008.

For the third quarter of 2008, the Company reported a net loss attributable to common stockholders of $22.2 million, or $0.71 per share, compared to a net loss attributable to common stockholders of $22.6 million, or $0.73 per share, in the third quarter of 2007. Cash, cash equivalents and marketable securities at September 30, 2008 totaled $70.3 million.

In the third quarter of 2008, the Company did not recognize any revenue compared to negative revenue of $0.6 million in the third quarter of 2007. The Company's third quarter revenue in 2007 was impacted by an increase in the total estimated development program costs related to Trizytek(TM) (liprotamase).

Research and development expenses totaled $18.7 million in both the third quarter of 2008 and 2007. Third quarter 2008 R&D spending reflects continued clinical and manufacturing costs associated with Trizytek and outsourced third-party and internal costs related to the ALTU-238 Phase 1c clinical trial. General, sales and administrative expenses were $4.3 million in the third quarter of 2008 compared to $4.4 million in the third quarter of 2007.

Based on current operating plans and the expected timing of product development programs, Altus believes that net cash used in operating activities will be between $80 million and $90 million in 2008.

"During the next quarter, we are expecting valuable Trizytek program information with respect to ongoing business development and clinical/regulatory initiatives. This input will assist the Company in finalizing the strategic plan for 2009 and beyond," stated Dr. Georges Gemayel, President and Chief Executive Officer of Altus Pharmaceuticals. "We are pursuing business development discussions with potential partners regarding Trizytek and we are pleased with the quality and quantity of companies interested in the program. We strongly believe that Trizytek will be an important therapy and we want to ensure that the drug reaches patients as soon as possible. To this end, Altus has a pre-NDA meeting scheduled for mid-November to discuss the Trizytek data package with the FDA."

During the third quarter of 2008, the Company released top-line results from its 163 patient, double-blind, placebo-controlled, Phase 3 trial of Trizytek, which is a stable and pure combination of three active enzymes in a fixed-ratio that is designed to improve fat, protein and carbohydrate absorption in pancreatic insufficient individuals. Trizytek successfully met its primary efficacy endpoint of improvement in fat absorption in patients with cystic fibrosis (CF) with statistical significance (Click here to view the August 11, 2008 press release.) Trizytek was well-tolerated and had a favorable safety profile in the trial. There were no serious adverse events attributed to the Trizytek treatment.

Altus' Trizytek Phase 3 clinical program is the largest ever conducted to evaluate the efficacy and safety of pancreatic enzyme replacement therapy in cystic fibrosis patients. The Trizytek Phase 3 efficacy study results were recently presented at both oral and poster sessions at the 2008 North American Cystic Fibrosis Conference on October 23 and 24.

Dr. Gemayel continued, "For pancreatic insufficient patients, the most relevant measure of success is long-term health outcomes, such as weight and height maintenance or gain. We are looking at these as well as other overall health outcomes in the Trizytek long-term studies that are evaluating patients exposed to Trizytek for one year. Preliminary data from the open-label long-term studies suggest that adults are maintaining their weight and BMI percentiles and children are maintaining their height and weight percentiles with continued Trizytek treatment. We believe the information from more than the 200 patients from these studies will be extremely powerful in differentiating Trizytek from all other pancreatic enzyme replacement products. We are on track to complete these studies, as expected, in the first half of 2009."

Dr. Gemayel continued, "I am pleased to report that the ALTU-238 Phase 1c study started and completed in the third quarter. This trial was designed to confirm that the ALTU-238 material, produced at the current increased manufacturing scale, performs similar to the material used in previous ALTU-238 studies. We expect to report results in the fourth quarter. In addition, we believe the information gathered from the trial will be helpful in future ALTU-238 clinical studies."

Conference Call Access Information

The Company will host a conference call to discuss the third quarter results at 11:00 a.m. ET on November 4. The call may be joined via telephone by dialing [phone] or [phone] (for international participants) at least 5 minutes prior to the start of the call. The conference confirmation code is: 9147033. For 72 hours following the call, an audio replay can be accessed by dialing [phone] or [phone] and using the conference confirmation code 9147033. A live audio webcast of the call will also be available on the "Investor Relations" section of the company's website, www.altus.com. An archived audio webcast will be available on the Altus website approximately two hours after the event and will be archived for 30 days.

About Altus Pharmaceuticals Inc.

Altus Pharmaceuticals (NASDAQ: ALTU) is a biopharmaceutical company focused on the development and commercialization of oral and injectable protein therapeutics for patients with gastrointestinal and metabolic disorders. The Company's website is www.altus.com.

Safe Harbor Statement

Some matters discussed in this news release are "forward-looking statements" that involve known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by the forward-looking statements. These statements include, but are not limited to, those relating to the amount of cash which will be used by the Company in operating activities for 2008, the types of information which will become available to the Company regarding the Trizytek program, the ability of the Company to enter into a business development transaction with a potential partner, the timing of the completion of the long-term Trizytek studies, beliefs concerning the safety and efficacy of Trizytek, and the expected timing of the reporting of the ALTU-238 Phase 1c data. These statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from any future results, performances or achievements expressed or implied by the forward-looking statements. These known or unknown risks, uncertainties and other factors, include, but are not limited to, uncertainties as to the future cost, timing, enrollment and success of ongoing and planned clinical trials; the risk of demonstrating the ultimate potential of our product pipeline; the continuing risks associated with the development and manufacture of products to supply the clinical trials and the unproven safety and efficacy of products under development. These risks are discussed in greater detail in the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2008 and Annual Report on Form 10-K for the year ended December 31, 2007 under the heading "Risk Factors." Given these uncertainties, you should not place undue reliance on these forward-looking statements. These statements speak only as of the date of this news release and Altus does not undertake any obligation to update or revise the statements.

[TABLE OMITTED]