Bayhill Therapeutics to Present Positive Data From a Phase IIb Trial of BHT-3009 in Multiple Sclerosis.

Preparations for a Phase III Trial Underway

PALO ALTO, Calif. -- Bayhill Therapeutics Inc., announced today top line data from a phase IIb study of its lead investigational drug candidate, BHT-3009, for the treatment of multiple sclerosis (MS). Patients in a prospectively defined group with high anti-myelin basic protein (MBP) antibodies in their cerebral spinal fluid (CSF) showed statistically significantly fewer gadolinium-enhancing lesions in their brain after treatment with 0.5 mg of BHT-3009 compared with placebo. Reductions in T2 volumes and T1 black holes were also observed in this same population. In addition, there were strong trends in these same measures when applied to the trial's intent-to-treat patient population. BHT-3009 was found to be well tolerated in this study. Furthermore, using the company's proprietary protein microarray technology, statistically significant reductions in several CSF myelin-specific autoantibodies were achieved in all patients treated with 0.5 mg of BHT-3009, compared with placebo. These findings thus demonstrate strong evidence of antigen-specific tolerance produced by BHT-3009.

The Company announced that it intends to schedule an end of Phase II meeting with the FDA to discuss designs for registration trials.

Hideki Garren, M.D., Ph.D., Bayhill's co-founder and Vice President of Research will present data from this trial at the American Neurological Association meeting in Washington D.C. on October 9 and at a podium presentation at the annual conference of the 23rd Congress of the European Committee for Treatment and Research in Multiple Sclerosis (ECTRIMS) in Prague, Czech Republic on October 12. Mark Schwartz, Ph.D., Bayhill's CEO and President will also present data from this trial at the BIO Investor Forum 2007 in San Francisco on October 10.

The phase IIb trial is a multi-center, randomized, double-blind placebo-controlled trial of 289 relapsing remitting MS patients. Patients were dosed monthly for one year with intramuscular injections of the investigational product BHT-3009. The trial's endpoints are brain magnetic resonance imaging (MRI) measures of disease activity including gadolinium-enhancing lesions, T2 lesions and T1 black holes. These endpoints are uniformly used in Phase II trials for multiple sclerosis.

Commenting on the data from the Phase IIb trial, Dr. Lawrence Steinman, Professor of Neurology and Neurological Sciences at Stanford Medical School and co-founder of Bayhill said, "A long sought after goal in immunology has been to obtain tissue specific tolerance, without globally suppressing the immune system. We are delighted with the demonstration of tolerization of the immune system to myelin proteins in individuals with multiple sclerosis."

"We are pleased with the top line results of our Phase IIb trial. BHT-3009 is the first of several programs arising from our BHT-DNA technology platform," said Dr. Schwartz. "This platform is capable of rapidly producing new molecular entities targeting major unmet medical needs in large autoimmune disease markets. Our second program from this platform is BHT-3021, currently in the clinic for autoimmune Type 1 diabetes. We are very excited about expanding our efforts in these programs."

About BHT-3009

The investigational product BHT-3009 is an autoimmune DNA vaccine that encodes MBP. It is designed to reprogram the immune system to tolerate rather than attack the brain's myelin sheath. After administration of BHT-3009, immunological studies indicated that MS patients demonstrated decreased MBP-specific T cells in their blood and decreased anti-MBP antibodies in their spinal fluid. Normal T cells were not affected.

About Multiple Sclerosis

MS is characterized by an errant autoimmune reaction that causes damage to the myelin sheath and axon. MBP is a component of the myelin sheath, and in MS this protein is targeted by MBP-specific active T cells. These T cells consequently damage the protective myelin sheath that encases the neurons responsible for nerve transmission, resulting in destructive short circuits in the body's central nervous system.

MS is the most common non-traumatic cause of disability in young adults. Approximately 400,000 in the United States today suffer from the disease, at a national cost of nearly $10 billion. Symptoms of this chronic, progressive disease can include muscle, sensory and visual impairments, fatigue, bladder, bowel and sexual dysfunction.

About Bayhill Therapeutics

Bayhill Therapeutics Inc. is a clinical-stage biotechnology company focused on developing and commercializing therapeutics that fundamentally alter the way autoimmune diseases are treated. The company has developed two therapeutic platforms with broad applicability to a range of autoimmune diseases. Bayhill's BHT-DNA autoimmune vaccine is designed to eliminate disease-causing cells without affecting normal protective immune system cells. BHT-DNA is being studied in a recently completed Phase II trial for multiple sclerosis and a Phase I/II trial for autoimmune diabetes. Bayhill's second therapeutic platform is an oligonucleotide; the first product candidate is in preclinical development for systemic lupus erythematosus. More information about Bayhill Therapeutics is available at www.bayhilltx.com.