Broadening the CNS pipeline; SCHWARZ PHARMA to Develop Drug for Epilepsy and Neurogenic Pain.

Business Editors, Science/Medical Writers

HOLMDEL, N.J.--(BUSINESS WIRE)--Dec. 27, 1999

SCHWARZ PHARMA and Harris FRC, Holmdel, New Jersey (USA) today announced that SCHWARZ PHARMA has acquired the rights to complete the development and commercialization of Harkoseride (ADD 234037), a novel drug in the area of central nervous system (CNS) diseases currently in Phase II clinical trials for epilepsy. SCHWARZ PHARMA acquired worldwide rights with the exception of Japan. No financial terms of the agreement were disclosed.

"This is a promising drug with the potential to address at least two areas of unmet medical need" comments Lars Ekman, MD, PhD, member of the Board for Schwarz Pharma AG. "The first results in patients are very encouraging, which is not surprising given the strong profile Harkoseride demonstrated in the National Institute of Health's screening studies. In addition, our partner, Dr. Harris and his colleagues have done an excellent job in developing Harkoseride this far. Therefore, we acquire a drug with an excellent data package." Based on its potent anticonvulsant properties, the NIH has continued to support Harkoseride by funding early clinical trials.

Bob Harris, PhD, President and CEO of Harris FRC, said "We have been developing Harkoseride for four years and have been consistently impressed with the remarkable properties of the drug. The program now must be rapidly expanded; thus, we are delighted to have SCHWARZ PHARMA as a partner. SCHWARZ PHARMA has an exciting CNS portfolio and a rapidly growing ability to develop and commercialize new drugs in the United States, Europe, and other areas of the world. Yet as a mid-sized company they are quick and responsive with an entrepreneurial spirit. Therefore, I am confident that Harkoseride is in the right hands to assure it will be developed and marketed to its full potential."

Epilepsy is one of the most prevalent neurological disorders, affecting approximately 1% of the worldwide population. Current therapies are characterized by a trade-off between efficacy and side effects. Many patients continue to have seizures in spite of trying all available drugs in various combinations. Neurogenic pain can be defined as pain resulting from noninflammatory dysfunction of the nervous system. Reports have indicated that at least 1% of the population suffers from some form of neurogenic pain, and this number is probably as high as 50% of patients over the age of 65. Critically, physicians currently have few treatment options, which have proven effectiveness in treating neurogenic pain.

Together with other agreements signed in December (rights for a prostate cancer compound from Cephalon Inc., extension of rights for the Parkinson-Patch with DTI, rights for antiarrhythmics with ARYx) the development projects will have a significant impact on SCHWARZ PHARMA's R&D cost structure for 1999, 2000 and the following years. Management expects 1999 net profit to fall below DM 20 million, as was announced in October. It is likely that 1999 net profit will fall to around DM 15 million. For 2000, research and development expenses will increase an additional DM 40 million.

SCHWARZ PHARMA AG has its headquarters in Monheim, Germany. The company expects global sales of DM 1.37 billion in 1999. SCHWARZ PHARMA develops and markets innovative drugs for unmet medical needs. The company has a strong international presence with subsidiaries in Germany, the U.S.A., Italy, Spain, France, Great Britain, Poland, and China. Furthermore, licensing agreements for SCHWARZ PHARMA products exist in 50 other countries. Shares of SCHWARZ PHARMA AG are traded on the Frankfurt and Dusseldorf stock exchanges. For more information, please see our web site: www.schwarzpharma.com

Harris FRC Corporation, headquartered in Holmdel, NJ, USA, provides expert consultant services to the pharmaceutical industry in addition to being an early phase drug development company. In the capacity of consultant, Harris FRC has assisted more than 100 pharmaceutical companies over the last 13 years and has also been a major contributor to numerous new drug applications, which have resulted in significant pharmaceutical advances.