Axys Pharmaceuticals and Rhone-Poulenc Rorer Pharmaceuticals to Collaborate On Protease Inhibitors Associated With Inflammatory Diseases.

SOUTH SAN FRANCISCO, Calif. and COLLEGEVILLE, Pa.--(BW HealthWire)--Dec. 18, 1998--Rhone-Poulenc Rorer, a subsidiary of Rhone-Poulenc S.A. (NYSE: RP) and Axys Pharmaceuticals, Inc. (Nasdaq: AXPH) announced today a collaborative research and development agreement. The objective of the collaboration is the discovery and development of small molecule therapeutics that inhibit cathepsin S, a human cysteine protease associated with certain inflammatory diseases, including arthritis, asthma, atherosclerosis and a variety of autoimmune diseases. The collaboration is for two years and may be extended by RPR for up to an additional two years. Under the terms of the agreement, RPR will receive exclusive development and marketing rights to cathepsin S protease inhibitors for respiratory diseases, atherosclerosis and related conditions and rheumatoid arthritis. The agreement provides for over $80 million in potential payments to Axys in the form of research funding, license fees and milestones, in addition to royalties.

Cathepsin S is a member of a large family of cysteine proteases, enzymes that are responsible for the cleavage and breakdown of other natural proteins in normal biological processes. In disease conditions, cystein proteases can often be misregulated, providing an entry point for drug intervention. Cathepsin S has been highly associated with the processing and activation of the antigen receptor called MHC-II, essential for the initiation of both normal and pathological immune responses mediated by T-cells. Drugs designed to inhibit this enzyme are expected to provide a novel method for control of antigen-induced response in multiple inflammatory and autoimmune disease states.

"Axys brings to this collaboration a significant body of knowledge about the role of cathepsin S in human disease and about the design of inhibitors of cathepsin S as potential therapeutics," said Michael C. Venuti, Ph.D., senior vice president, research and preclinical development, at Axys. "As reported in the June 1998 issue of the peer-reviewed journal Protein Science, Axys researchers were the first to elucidate the three-dimensional structure of cathepsin S. This structural understanding has allowed us to design potent and selective inhibitors of this protease for pharmacological evaluation in models of inflammatory and autoimmune diseases. RPR makes for a superior strategic partner in this program given their research, development and commercialization expertise in respiratory, cardiovascular and inflammatory diseases," Dr. Venuti concluded.

"Having already identified cathepsin S as a target of significant interest to RPR in at least three therapeutic areas," commented Dr. Steve Webber, therapeutic areas head for asthma/inflammation at RPR, "we are delighted to partner with Axys, a company that brings a wealth of experience in the protease field with a world-class reputation in cathepsin biochemistry, particularly in the elucidation of the structure of cathepsin S." Dr. Michael Ashton, RPR's vice president, global chemistry, added, "Our collaboration with Axys will maximize the opportunity of bringing much needed new medicines to the medical community, particularly in the area of respiratory disease. The combination of Axys' expertise with RPR's expertise in rapid parallel optimization, respiratory and cardiovascular research will maximize our chances of successfully bringing potentially major products to the marketplace."

ABOUT AXYS PHARMACEUTICALS AND RPR

Axys Pharmaceuticals is a leader in the integration of life science technologies with a focus on transforming gene discoveries into drugs. The company has research collaborations with world-class pharmaceutical companies, covering a broad range of therapeutic areas, including respiratory, cardiovascular and infectious disease, as well as oncology and central nervous system disorders.

Rhone-Poulenc Rorer, the global pharmaceutical subsidiary of Rhone-Poulenc S.A., is dedicated to improving human health through the development of traditional pharmaceutical and gene-based therapeutics. Rhone-Poulenc S.A. is a leading life sciences company, growing through innovations in human, plant and animal health and through its specialty chemicals subsidiary, Rhodia. With sales in 1997 of FF90 billion (US$15 billion), the company employs 68,000 people in 160 countries worldwide.

Except for the historical information contained herein, this press release contains forward-looking statements that involve risks and uncertainties which could cause Axys' actual results to differ materially from those discussed here, including Axys' reliance on the efforts of its collaborative partners, the risk that Axys' collaborations will not be successful, risk that clinical trials will not proceed as anticipated or may not be successful, the risk of Axys' early stage of development, the risk that Axys will not be successful in entering into new collaborations, competition, the risk of unexpected difficulties and delays in the development of new technologies, and general economic conditions that may affect Axys' actual results and developments. Additional factors that could cause or contribute to such differences include, but are not limited to, those discussed in the sections entitled "Business" and "Additional Risk Factors" in the company's SEC Reports, including the company's report on Form 10-K for the fiscal year ended December 31, 1997.

Editor's Note: For more information on Axys Pharmaceuticals, Inc., please visit the company's website at http://www.axyspharm.com. This release is also available on the World Wide Web at http://www.rp-rorer.com.