BARRx, Inc. Seals $6M in First Outside Round; Strong Investor Interest Leads to Oversubscribed Round.

Business Editors/Health/Medical Writers

SUNNYVALE, Calif.--(BUSINESS WIRE)--April 21, 2003

BARRx, Inc., creator of the industry's first option for the effective treatment of Barrett's esophagus, a pre-cancerous condition resulting from long-standing Gastroesophageal Reflux Disease (GERD), today announced that it has received $6M in a Series A funding. New investors Charter Ventures, Delphi Ventures, and Alloy Ventures joined founders and seed investors Stellartech Research Corporation, Robert A. Ganz, M.D., and Brian D. Zelickson, M.D. The new investment will enable BARRx to complete product development on its pioneering treatment for Barrett's and fund its first clinical trial in humans over the next two years.

Investors in BARRx, Douglas E. Kelly, M.D., from Alloy Ventures, David L. Douglas from Delphi Ventures and A. Barr Dolan from Charter Ventures have been appointed to the Company's board of directors. To date, BARRx has been operated as a low-burn rate "virtual company," incubated within Stellartech, a medical device development and manufacturing firm. Going forward, a management team will be recruited to transition BARRx from a "virtual" to an independent company.

"We estimate that more than four million cases of Barrett's esophagus exist in the US alone," said Roger A. Stern, Ph.D., co-founder of BARRx and president of Stellartech. "These numbers are growing at more than 10% per year. More than one billion dollars is currently spent annually on caring for Barrett's patients which will translate to a large market for BARRx therapy in the coming years."

Founded in June 2000 by industry experts in gastroenterology and tissue ablation techniques, BARRx, Inc. will offer a practical, safe and effective option to millions suffering from Barrett's esophagus. "Medical or surgical treatments for GERD do not treat Barrett's, and the chronic use of antacids can actually mask symptoms and reduce the likelihood of detection of Barrett's. BARRx will present the industry's first therapeutic option in the treatment of Barrett's esophagus, which should reduce rates of esophageal cancer and result in lower costs to the health care system," said Barr Dolan, partner at Charter Ventures.

"BARRx is addressing a significant medical issue for millions of people, representing a substantial market opportunity. We look forward to their next growth phase and building a results-oriented management team who is as bullish on BARRx's future as we are," said Douglas Kelly, partner at Alloy Ventures.

Current treatments for Barrett's esophagus, which is a change to the mucosal lining of the esophagus as a result of chronic reflux, or GERD, are ineffective at best. Current management involves conducting surveillance endoscopy with biopsies every 2-3 years to monitor suspect tissue. Barrett's can be visualized during endoscopy as the reddened areas of abnormal columnar mucosa, surrounded by areas with normal pink squamous mucosa. Chronic reflux causes changes to the cells that line the esophagus. The initial changes are called metaplasia and may become pre-cancerous. Further changes to these cells result in dysplasia which can become esophageal cancer. If cancer develops, standard of care requires surgical removal of the esophagus.

About BARRx, Inc.

BARRx, Inc. is an early stage development company founded to develop safe and effective treatment for Barrett's esophagus, a pre-cancerous condition that can lead to esophageal cancer. Located in Sunnyvale, Calif., the company is currently in the product development phase and preparing to begin human clinical trials. More information on BARRx, Inc. can be found at www.BARRx.com.

About Alloy Ventures

Alloy Ventures invests primarily in seed and early stage companies in information technology and the life sciences. The firm's partners all have entrepreneurial experience, and have decades of seed and early-stage venture capital experience. They have helped start and foster more than 200 companies, including Amgen, Applied Biosystems (acquired by Perkin Elmer), Archive (acquired by Conner), Aviron (acquired by MedImmune), Conductus, CV Therapeutics, Red Brick Systems (acquired by Informix), Remedy (acquired by Peregrine Systems).

Respect for the entrepreneur is a core value at Alloy. The firm offers entrepreneurs the experience, connections and capital necessary to build lasting, market-leading companies. For more information, visit www.alloyventures.com.

About Charter Ventures

Charter Ventures is a leading early-stage venture capital firm that has helped entrepreneurs turn great ideas into great companies for more than 20 years. Based in Palo Alto, Calif., Charter invests in the areas of software, communications and life sciences. Recent investments include Ellie Mae, Integrated Biosystems, Maple Optical Networks, Metabolex, nDO Surgical, Talaris, and Xalted Networks. More information on Charter Ventures can be found at www.CharterVentures.com.

About Delphi Ventures

Delphi Ventures is a venture capital firm focusing on early-stage medical device and biotechnology investments throughout the United States. Started in 1988, the Firm has approximately $600.0 million under management and has invested in over 120 healthcare companies in all major segments of healthcare. These investments have included Aneurx (acquired by Medtronic, Inc.), Cardiac Pathways Corp. (acquired by Boston Scientific Corp.), GyneCare (acquired by Johnson & Johnson Corp.), Innovasive Devices, Inc. (acquired by Johnson & Johnson Corp.), Interventional Technologies, Inc., (acquired by Boston Scientific Corp.), Oratec Interventions, Inc., (acquired by Smith & Nephew Corp.), VidaMed, Inc. (acquired by Medtronic, Inc.), Applied Molecular Evolution, Inc. (AMEV), Telik, Inc. (TELK), TheraSense, Inc. (THER), and Tularik (TLRK).