BioSante Pharmaceuticals Announces Receipt of NIH Grant for Oral Insulin.

Business Editors/Health/Medical Writers

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LINCOLNSHIRE, Ill.--(BUSINESS WIRE)--Sept. 8, 2003

BioSante Pharmaceuticals, Inc. (OTC BB: BISP) announced today it has been awarded a $100,000 Small Business Innovation Research (SBIR) grant from the National Institutes of Health (NIH) to support the company's development of formulations for the oral delivery of insulin using its proprietary calcium phosphate particulate (CAP) technology.

The new grant will be used to fund product development work on BioSante's CAP delivery technology for oral insulin. Dr. Tulin Morcol, associate director of drug delivery and related technologies for BioSante, will serve as lead scientist.

"We are honored and delighted to receive this grant from the NIH," said Stephen M. Simes, president and chief executive officer of BioSante. "This represents further validation of the potential of this important new technology, and will result in increased value for our stockholders."

Initiated by the NIH in 1982, the SBIR grants program is designed to encourage research and development of innovative technology by small businesses with the potential for commercialization. Initial grants of up to $100,000 are awarded for research establishing technical merit and feasibility of the project. Successful programs are eligible for grants of up to $750,000 to continue research. Each division of the NIH awards its own grants to qualified companies; BioSante's grant is from the National Institute of Diabetes and Digestive and Kidney Diseases (NIDDK).

Earlier this year BioSante announced positive results of preclinical testing of its CAP delivery system for the oral delivery of insulin at the Institute for International Research USA's second annual Protein and Peptide Formulation Strategies meeting.

"The results of our study show that this unique formulation has the potential to overcome the considerable obstacles to effective oral delivery of insulin," said Dr. Morcol. "The SBIR grant will allow us to further characterize and improve our oral insulin formulation as an easily administered, pain-free alternative to insulin injections for diabetics."

The preclinical study evaluated the use of BioSante's CAPOral(TM) drug delivery system to administer insulin orally. The oral formulation was developed by aggregating caseins (the principal protein of milk) around a proprietary formulation of CAPOral, polyethylene glycol (PEG, a polymer) and insulin by scientists at BioSante's research center in Smyrna, Georgia. The pharmacokinetics and therapeutic efficacy of the formulation, known as CAPIC(TM), was tested in diabetic mice and normal rats.

CAPIC rapidly reduced blood glucose levels in the diabetic mice by 80 percent within 1-2 hours of treatment, and the reduced levels were maintained for 10 hours. In the control group, the insulin solution alone reduced blood glucose levels by 25 percent within the first half-hour to hour after treatment, and levels returned to baseline within a few hours. In the normal rats, blood glucose levels began to decline 3-4 hours after administration of CAPIC, reaching an 80 percent reduction 6 hours after administration. By contrast, there was no notable change in glucose levels in normal rats following administration of insulin solution alone.

"Pharmacokinetic analysis indicated that CAPIC significantly increased the half-life and mean resistance time of the insulin," said Dr. Morcol. "Furthermore, insulin in CAPIC form was eliminated from the body significantly slower than insulin in solution."

Dr. Morcol said the casein coating around the CAP-insulin core protects the insulin as it passes through the stomach to the small intestines. She noted that the casein may also provide mucoadhesive properties that allow the drug to remain concentrated at the site of absorption, resulting in sustained release and longer-lasting transport into the blood stream.

"The results of this study strengthen our belief that the use of CAPIC offers great potential to become an important new treatment option for diabetes," Simes said. "The SBIR grant will help us to fund the oral insulin work in order to maximize its efficiency. Also, we will continue to develop CAPOral for the oral delivery of other therapeutic proteins that currently must be injected."

CAPOral is an oral delivery system using the company's calcium phosphate particle technology. The CAP particles are synthetic analogs of the core material found in teeth and bones. The patented formulation is nontoxic and biodegradable, offering a multitude of potential medical applications.

BioSante recently announced a cooperative research and development agreement (CRADA) with the U.S. Army's Medical Research Institute of Infectious Diseases for the development of several needle-free biodefense vaccines, including anthrax and ricin. In February, the company announced a CRADA with the U.S. Navy to develop a vaccine for malaria.

About BioSante Pharmaceuticals, Inc.

BioSante is an emerging pharmaceutical company developing a pipeline of hormone therapy products to treat both men and women. BioSante also is developing its nanoparticulate-based platform technology (CAP) for novel vaccines, vaccine adjuvants and drug delivery systems including oral administration of proteins, such as insulin. Additional information is available online at www.biosantepharma.com.

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The statements regarding BioSante contained in this press release that are not historical in nature, particularly those that utilize terminology such as "may," "will," "should," "likely," "expects," "anticipates," "estimates," "believes" or "plans," or comparable terminology, are forward-looking statements. An example of a forward-looking statement in this news release is the statement regarding the potential of BioVant to become an adjuvant of choice for the next generation of vaccines. Forward-looking statements are based on current expectations and assumptions, and entail various risks and uncertainties that could cause actual results to differ materially from those expressed in such forward-looking statements. Important factors known to BioSante that cause actual results to differ materially from those expressed in such forward-looking statements are the difficulty of developing pharmaceutical products, obtaining regulatory and other approvals and achieving market acceptance, and other factors identified and discussed from time to time in BioSante's filings with the Securities and Exchange Commission, including those factors discussed on pages 17 to 23 of BioSante's Form 10-KSB, which discussion also is incorporated herein by reference.