Connetics Announces Pivotal Trial Results of Relaxin for Scleroderma; Trial Did Not Reach Primary Endpoint; Relaxin Development Program in Other Indications Continues.

Business Editors/Medical Writers

PALO ALTO, Calif.--(BW HealthWire)--Oct. 9, 2000

Connetics Corporation (Nasdaq:CNCT) today announced that a Phase III trial investigating recombinant human relaxin in the treatment of diffuse systemic sclerosis, also known as scleroderma, did not meet its primary endpoint. Based on the preliminary results, Connetics will not file a BLA for relaxin in the treatment of scleroderma. Connetics will continue its relaxin clinical development programs in vascular diseases and infertility. Detailed results of the trial will be presented on October 24 at the Relaxin 2000 Conference in Broome, Australia, which is being sponsored by the Howard Florey Institute at the University of Melbourne.

"Scleroderma has again proven to be an extremely difficult disease for which to develop a therapeutic treatment," said Krisztina Zsebo, Ph.D., executive vice president, research and product development. "However, the trial has produced important additional data on the biological activity of relaxin in humans. What we have found validates the angiogenic and vasodilatory benefits seen in previous preclinical data. Based on the results from this trial, and substantial existing preclinical data, we are encouraged by the confirmation of relaxin's biologic effect and the implications of this data for relaxin's potential in vascular disease and infertility."

"Clearly, we had hoped for different results for the thousands of scleroderma patients who desperately need an effective treatment," said Thomas G. Wiggans, president and chief executive officer of Connetics. "The commitment of our clinical investigators and the Connetics employees working on this program was remarkable. Despite the setback in this program, our business fundamentals are solid and our mission is unchanged. We will continue our relaxin and dermatology clinical development programs. We anticipate continued revenue growth and expanding commercial activities. Our financial position is strong and we will continue to focus on executing our business plan."

"We are very saddened for patients and study investigators that the trial did not achieve the statistical significance seen in previous studies," said James R. Seibold, M.D., lead investigator and Director of the Scleroderma Program of the University of Medicine & Dentistry of New Jersey. "However, our experience in this trial provides valuable information for future research targeting this complex disease."

The trial involved 239 patients with stable, moderate to severe diffuse scleroderma of less than five years of duration. Three cohorts of patients were treated with placebo, 10 or 25 micrograms per kilogram per day of relaxin given by continuous subcutaneous infusion over 24 weeks. The primary endpoint of the trial was assessed using the Modified Rodnan Skin Score. Patients achieved mean reductions in skin scores of 4.9 with placebo, 4.3 with 10 micrograms per kilogram per day and 5.2 with 25 micrograms per kilogram per day. The safety profile was similar to Connetics' previous Phase II scleroderma trial.

Clinical Development Program for Relaxin

Relaxin is a naturally occurring hormone with several distinct biological activities including vasodilation, angiogenesis and inhibition of fibrosis. The hormone is thought to be responsible for many cardiovascular changes that occur during pregnancy, including increased blood flow, which is due to an increase in the number of vessels (angiogenesis) and an expansion in the diameter of vessels (dilation). The angiogenic effects are mediated by an upregulation of bFGF and VEGF by relaxin, and the vasodilatory effects are thought to be mediated by inhibiting the constrictive effects of angiotensin and endothelin.

Based on these discrete biological properties, Connetics has initiated development programs to expand on relaxin as a platform therapeutic treatment. The company has ongoing clinical programs in cardiovascular and peripheral vascular disease, as well as infertility.

"Connetics has a solid business which focuses on growth through product development and revenues from marketed products," said John L. Higgins, executive vice president and chief financial officer. "We currently have two marketed products and intend to launch a new product this quarter. As we advance relaxin for other indications, we are also committed to developing our pipeline of proprietary dermatology products and maximizing sales and revenues from our growing product line. We expect to burn less than $15 million for the year and our cash and marketable securities currently exceed $80 million."

Connetics held a live Web cast/teleconference call to go over the Phase III results yesterday, Sunday, October 8 at 1:00 p.m. PDT/4:00 p.m. EDT. The recorded call may be listened to by calling replay number 1-800-938-1593 and entering pass code number 88881. It is also available over the Internet on Connetics' Web site at www.connetics.com or at www.vcall.com/NASApp/VCall/EventPage?ID=45027. The call will be available until October 31.

About Connetics

Connetics Corporation, headquartered in Palo Alto, California, is a biopharmaceutical company focused on the development of recombinant human relaxin for multiple indications and on the development and commercialization of novel therapeutics for dermatology and other specialty medical markets. For more information about Connetics and its products, please visit Connetics' Web site at www.connetics.com, or send e-mail to [e-mail].

This news release contains forward-looking statements about continued collaboration with corporate partner, future product development, clinical trials and financial results. These statements represent our judgment as the date of this news release and are subject to risks and uncertainties that could cause actual results or events to differ materially from those expressed in such forward-looking statements. In particular, we face risks and uncertainties that product development may not succeed, that clinical trials may not go forward as planned, or may not succeed, that our cash burn rate will exceed our projections and that the value of our marketable securities may be affected by fluctuations in the stock market. These and other factors are discussed in more depth in Connetics' Form 10-K dated March 2, 2000, and in the Company's other filings with the SEC. These documents contain and identify important factors that could cause the actual results to differ materially from those contained in the forward-looking statements.