Atlantic Pharmaceuticals Announces Termination of Beta-cyclodextrin Program.

NEW YORK--(BW HealthWire)--Oct. 12, 1999--

Represents immediate savings, and will permit Atlantic

to focus its resources on technologies that are more compatible

with its strategic objectives

Atlantic Pharmaceuticals, Inc. (NASDAQ: ATLC) today announced that Atlantic and its wholly-owned subsidiary, Channel Therapeutics, Inc., have pursuant to an agreement with the Trustees of the University of Pennsylvania ("Penn") terminated the license agreement dated as of June 16, 1994, between Penn and Channel, as amended. Atlantic and Channel, on the one hand, and Penn, on the other hand, released each other from any further obligations under the license agreement, and Atlantic paid Penn a portion of the patent costs for which Penn was seeking reimbursement under the license agreement. Frederic P. Zotos, an Atlantic board member, negotiated the deal on behalf on Channel and Atlantic.

Under the license agreement, Penn licensed to Channel rights to use of Beta-cyclodextrin tetradecasulfate (B-CDT) in preventing restenosis after cardiac angioplasty. While the technology shows promise, Atlantic has decided that it does not fit into its current strategic focus. Dr. A. Joseph Rudick, President of Atlantic Pharmaceuticals, stated that "while the technology has advanced under Atlantic's direction, the costs involved to move the technology to a clinical stage were beyond the resources that we are willing to commit. Our strategy is to concentrate on those of our technologies that have the greatest potential to attract development partners." Consequently, by terminating the license agreement, Atlantic not only saved present and future patent costs that it owed Penn under the license agreement, but also allowed Atlantic to focus its resources on technologies that offer significantly greater potential for near-term development and corporate partnerships.

These technologies include the promising Catarex(TM) cataract-removal device, which has been licensed to Bausch & Lomb Surgical, Inc., a subsidiary of Bausch & Lomb Incorporated (NYSE:BOL), by Optex Ophthalmologics, Inc., a subsidiary of Atlantic. The development and license agreement between B&L Surgical and Optex was recently amended to expand Optex's role in development of this device. As announced on September 22, 1999, the amended contract is worth approximately $9.6 million, and allows for Optex to operate at a profit for the duration of the contract. "This is the type of deal structure that we are looking to duplicate with our other technologies" states Dr. Rudick. Atlantic is also pursuing continued development of CT-3, a novel anti-inflammatory, analgesic compound, and its 2-5A antisense enhancement technology, and continues to actively pursue synergistic and late-stage technologies.

Safe Harbor Statement

Cautionary statement under the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995: This press release contains certain forward-looking statements that relate to future scientific, business and financial performance. These statements are only predictions and are subject to a number of risks and uncertainties that may cause the actual events or results to differ from those discussed or implied in these statements. These risks and uncertainties include competition from other manufacturers of cataract-extraction technologies, the unavailability of any necessary intellectual property rights possessed by third parties, and certain of those risks described in Atlantic's most recent report on Form 10-KSB filed with the Securities and Exchange Commission.