Catalytica Announces Manufacturing Partnership with Shire; Catalytica Designated as Preferred Supplier for Shire Products.

MOUNTAIN VIEW, Calif.--(BW HealthWire)--Sept. 15, 1999--

Catalytica Pharmaceuticals, Inc., a subsidiary of Catalytica, Inc. (Nasdaq:CTAL), announced today that it has signed a preferred supply agreement with Shire Pharmaceuticals Group plc (LSE:SHP.L) (Nasdaq:SHPGY). Under the terms of the five-year agreement, with provisions for a five-year renewal, Catalytica Pharmaceuticals will manufacture several Shire products at its Greenville, North Carolina facility. Additionally, the agreement covers certain development and reformulation of products and allows for the addition of new Shire products.

According to Dr. Gabriel Cipau, President and CEO of Catalytica Pharmaceuticals, "We are very pleased to form this partnership with Shire. This agreement establishes a long-term relationship and allows both parties to benefit from our collective strengths. Catalytica has unique capabilities to handle every phase of chemical process and formulation development as well as complete facilities for product manufacturing. We believe this comprehensive capability can increase efficiencies in the production process and offer Shire the ability to better manage the outsourcing of products."

Commenting on the agreement, Rolf Stahel, Chief Executive of Shire, said: "Shire is very pleased to enter into this agreement with Catalytica. The consolidation of manufacturing for certain products to one site, which can handle such diverse requirements as manufacturing development work and the handling of a broad range of products, is an obvious advantage for Shire."

Shire Pharmaceuticals Group plc is an emerging pharmaceutical company focused primarily on two therapeutic areas; central nervous system disorders and metabolic/ bone diseases, with sales, marketing and R&D operations in the U.S. and the UK.

Catalytica Pharmaceuticals, Inc., a subsidiary of Catalytica, Inc., provides the pharmaceutical and biotech industries with comprehensive skills and demonstrated commercial experience in a broad spectrum of areas extending from process development through drug development, formulation, manufacturing and packaging. Since the acquisition of the Greenville Facility from Glaxo Wellcome in 1997, Catalytica has entered into over 40 new agreements for the development and manufacture of products for various pharmaceutical and biotech companies. In anticipation of additional business, it has expanded its chemical manufacturing facility and is currently expanding its sterile facility. It is the largest fully integrated drug development and manufacturing supplier in the world.

Catalytica, Inc. builds business in high growth industries where the Company's technologies optimize manufacturing and solve environmental problems. Catalytica Pharmaceuticals, Inc. provides drug development and product manufacturing to the pharmaceutical industry; Catalytica Combustion Systems, Inc. produces XONON, a catalytic system that permits essentially pollution free combustion for the energy market; and Catalytica Advanced Technologies, Inc. serves as an incubator for new catalytic technologies for industrial applications. Find Catalytica on the World Wide Web at www.catalytica-inc.com.

This news release contains forward-looking statements regarding Catalytica's future manufacturing and/or packaging of products for Shire Pharmaceuticals at the Greenville, North Carolina facility, including potential benefits to Shire and future process developments, the ability to obtain new business, the success of recently announced agreements and contracts, and of ongoing development contracts, the ability to market the Company's development, manufacturing and other services to current and prospective clients, and Catalytica's competitive position in its markets. Actual results could differ and such differences could be material. These statements involve risks and uncertainties, including without limitation, the ability to operate the development, manufacturing, and packaging facilities efficiently, the ability to perform cost effectively and in a timely manner, the potential for product development delays, changes in the company's competitive position, and the impact of FDA and other regulations on pharmaceutical and biotech manufacturing. Catalytica undertakes no obligation to update publicly any forward-looking statements to reflect new information, events, or circumstances after the date of this release. Investors are encouraged to review Catalytica's Form 10K for the year ending December 31, 1998, filed with the Securities and Exchange Commission for a discussion of additional factors that could affect Catalytica's future performance.