CombiChem Announces Drug Discovery Collaboration with Ono.

SAN DIEGO--(BW HealthWire)--Jan. 4, 1999--CombiChem Inc. (Nasdaq NMS: CCHM) today announced the signing of a drug discovery collaboration with Ono Pharmaceutical Co., Ltd., Osaka, Japan.

Under the terms of the collaboration, CombiChem will work with Ono to generate lead drug candidates for a target of interest to Ono in exchange for a project initiation fee, research support and milestone payments. Ono has exclusive global rights to develop and market or sub-license products resulting from the collaboration.

CombiChem will be entitled to royalties on sales of products resulting from the collaboration. The target of interest to Ono was selected from a group of targets which were screened using CombiChem's Universal Informer Library (UIL). Computational analysis of the screening data by CombiChem led to mutual agreement on the choice of target.

"We are pleased to enter this collaboration with Ono following a target prioritization screening agreement. Under the agreement, both groups worked together to evaluate targets and select a research target for this collaboration," stated Vicente Anido, Jr., Ph.D., CombiChem's president and chief executive officer.

"We have selected CombiChem for this collaboration because of the strength of their technology, particularly their computational approach to drug discovery," stated Toshio Ueno, Ono Pharmaceutical's president. He continued, "CombiChem's unique approach allowed us to identify the target for this lead generation program by utilizing their UIL to determine which targets were most tractable to small molecules."

Ono Pharmaceutical Co., Ltd. is an Osaka, Japan-based pharmaceutical company, focusing on research and development of novel drugs and is recognized as a world leader in prostaglandins and enzyme inhibitors. Ono was established in 1717 and is the 12th largest pharmaceutical company ranked by sales in Japan with fiscal 1997 sales of (Y)126,460 million ($1.02 billion).

CombiChem Inc., based in San Diego, is a computational drug discovery company that is applying its proprietary design technology and rapid synthesis capabilities to accelerate the discovery process for new drugs. The company believes its approach offers pharmaceutical, biotechnology and agrochemical companies the opportunity to conduct their discovery efforts in a more productive and cost effective manner.

Using its proprietary Discovery Engine(TM) process, the company focuses on the generation, evolution, and optimization of new lead candidates for its collaborative partners, who will then develop, manufacture, market, and sell the resulting products.

In addition to the collaboration with Ono, CombiChem has established collaborative agreements with Athena Neuroscience Inc., a wholly owned subsidiary of Elan Corp., plc., ICOS Corp., ImClone Systems Inc., Novartis Crop Protection AG, Roche Bioscience, Sumitomo Pharmaceuticals Co., Ltd., and Teijin Limited.

Except for the historical and financial information contained herein, the matters discussed in this news release may contain forward-looking statements which involve risks and uncertainties, including significant fluctuations in quarterly financial performance depending on factors such as timing of revenues recognized and achievement of milestones, a dependence on the efforts of third parties, a new and uncertain technology employed by CombiChem, dependence on intellectual property rights, the competitive nature of the company's industry and risks of obsolescence of certain technology. Actual results may differ materially from those projected. Forward-looking statements represent the judgment of the company as of the date of this release. CombiChem disclaims, however, any intent or obligation to update any forward-looking statements.

CombiChem's releases are on the Web at www.combichem.com.