CollaGenex Pharmaceuticals is Awarded $962,000 NIH Grant to Support Research of Potent Anti-Inflammatory Effects of Incyclinide (Col-3).

NEWTOWN, Pa. -- CollaGenex Pharmaceuticals, Inc. (Nasdaq:CGPI) today announced that the National Institutes of Health ("NIH") has awarded a grant of approximately $962,000 for additional research into the potent anti-inflammatory effects of incyclinide (formerly known as Col-3), the Company's compound currently in Phase II clinical trials for the treatment of acne. The grant will be paid over two years and will support CollaGenex's manufacturing and formulation development of incyclinide as well as preclinical studies by Gary Nieman, a research collaborator from the State University of New York, and Jay Zwischenberger, M.D., a research collaborator from the University of Texas, Galveston. Gary Nieman conducted earlier studies with incyclinide in models for acute inflammation, and he and Dr. Zwischenberger will conduct additional studies that should advance the Company's understanding of incyclinide's potent anti-inflammatory properties.

"We are very pleased that the NIH supports the work we are doing with incyclinide," Mr. Nieman said. "This grant recognizes the significant results of earlier NIH-supported studies and will more effectively enable us to identify a potential clinical treatment strategy for incyclinide in acute inflammatory disorders." Dr. Zwischenberger added, "NIH support for these studies will enable us to evaluate incyclinide as an anti-inflammatory agent in several model systems and help us understand the range of its therapeutic potential."

"This NIH grant adds another layer of credibility to the potent anti-inflammatory activities of incyclinide," added Klaus Theobald, M.D., chief medical officer of CollaGenex. "In clinical studies of patients with Kaposi's sarcoma and rosacea, we saw dramatic improvements in these inflammatory disorders in patients administered incyclinide. This NIH grant will help us better understand incyclinide's mechanisms of action and its potential to treat acute inflammatory conditions."

About CollaGenex

CollaGenex Pharmaceuticals, Inc. is a specialty pharmaceutical company that has built its reputation on providing innovative medical therapies to the dermatology and dental markets. In August 2005, CollaGenex filed a New Drug Application with the FDA for Oracea, a systemic compound for the treatment of rosacea, and in September 2005 CollaGenex initiated a 300-patient, Phase II dose-finding study to evaluate incyclinide for the treatment of acne. CollaGenex's professional dermatology sales force markets Pandel(R), a prescription topical corticosteroid licensed from Altana, Inc., Alcortin(TM) (1% iodoquinol and 2% hydrocortisone), a prescription topical antifungal steroid combination, and Novacort(TM) (2% hydrocortisone acetate and 1% pramoxine HCl). Alcortin and Novacort are marketed by the Company under an agreement with Primus Pharmaceuticals Inc. CollaGenex also currently sells Periostat, which the Company developed as the first pharmaceutical to treat periodontal disease by inhibiting the enzymes that destroy periodontal support tissues and by enhancing bone protein synthesis, and Atridox(R), Atrisorb FreeFlow(R) and Atrisorb-D FreeFlow(R), which are products of QLT, Inc., the successor to Atrix Laboratories, Inc., for the treatment of adult periodontitis.

Research has shown that certain tetracyclines can be chemically modified to retain non-antibiotic properties that may be effective in treating diseases involving inflammation and/or destruction of the body's connective tissues. CollaGenex is evaluating various chemically modified tetracycline compounds that include incyclinide and are known as "IMPACS(TM)" (Inhibitors of Multiple Proteases And CytokineS") to assess whether they are safe and effective in these applications. In addition, CollaGenex has acquired the Restoraderm(R) technology, a unique, proprietary dermal drug delivery system, and plans to develop a range of topical dermatological products with enhanced pharmacologic and cosmetic properties.

To receive additional information on the Company, please visit our Web site at www.collagenex.com, which does not form part of this press release.

Forward-Looking Statements

Statements in this press release regarding management's future expectations, beliefs, goals, plans or prospects, including statements relating to the Company's future products and the market for them, its future product development and introduction efforts, may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. CollaGenex's actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including those factors contained in CollaGenex' most recent Quarterly Report on Form 10-Q for the quarter ended September 30, 2005 under the section "Additional Risks That May Affect Results" as well as other documents that may be filed by CollaGenex from time to time with the Securities and Exchange Commission. Forward-looking statements include statements regarding CollaGenex' expectations, beliefs, intentions or strategies regarding the future and can be identified by forward-looking words such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "should", "will", and "would" or similar words. CollaGenex assumes no obligations to update the information included in this press release.

Periostat(R) and Restoraderm(R) are registered trademarks and IMPACS(TM) and Oracea(TM) are trademarks of CollaGenex Pharmaceuticals, Inc.

All other trade names, trademarks or service marks are the property of their respective owners and are not the property of CollaGenex Pharmaceuticals, Inc. or any of our subsidiaries.

Novacort(TM) and Alcortin(TM) are trademarks of Primus Pharmaceuticals, Inc.

Pandel(R) is a trademark of Taisho Pharmaceuticals.

Atridox(R), Atrisorb(R) and Atrisorb-D(R) are registered trademarks of QLT USA, Inc.