Cortecs enters into A$2.5 Million R&D syndication for the development of its oral Helicobacter pylori treatment.

LONDON--(BUSINESS WIRE)--January 17, 1995--Cortecs International (NASDAQ:DLVRY/LSE:COR.L/ASX:CRI) ("Cortecs"), today announced that it has entered into a third R&D Syndication for a total of A$2.52 million (1.21 million pounds) over a three year period to fund further development of its oral therapeutic vaccine against Helicobacter pylori ('H. pylori').

Cortecs will retain the worldwide commercialization rights to the technology developed by the Syndicate. The discovery that H. pylori is causal in the majority of peptic ulcers has been described as one of the most important medical discoveries of recent times.

Recently, the National Institute of Health in the USA identified that the H. pylori bacterium is the most common cause of peptic ulcers and gastritis. Over 80 million patients are treated for gastric and duodenal disease annually with anti-ulcer drugs. It has also been declared a Class One carcinogen by the World Health Organization meaning that it has been classified as a significant causal factor for gastric cancer. The anti-ulcer market alone is estimated to be in excess of US$10 billion. It is also estimated that H. pylori is the commonest chronic bacterial infection, affecting about one-third of the world's population.

Cortecs has been a pioneer in H. pylori research and development for almost 10 years. It launched its Helisal Rapid Blood test in 1994 for the detection of H. pylori in the doctor's office and has since entered into significant education and distribution agreements with Boehringer Mannheim, Zenyaku Kogyo and Astra Hassle for this product. Cortecs' contracts anticipate revenues in excess of 50 million pounds over the next 5-7 years in Europe, Japan and the USA.

The R&D Syndication funding enables Cortecs through its wholly owned subsidiary, the Australian Institute of Mucosal Immunology ('AIMI'), which is based in Newcastle, Australia, to combine two of Cortecs' unique discoveries to progress the development of a safe oral therapeutic vaccine to prevent and treat H. pylori infection, and thus change the course of ulcer disease. Firstly, the unique preparation of H. pylori antigen used in the Helisal rapid diagnostic test, has been shown to protect against infection in an animal model. Secondly, a new Cortecs' delivery system called MACROSOL, was shown to markedly enhance immunity following oral immunization in small animals. The H. pylori therapeutic vaccine, formulated with biosynthesized unique H. pylori antigens and MACROSOL, will be developed as a candidate therapeutic vaccine for the elimination of H. pylori infection.

This project, like all R&D Syndication projects, had to be assessed by the Australian Industrial Research and Development Board and declared to involve "core technology" before it could be included in an approved R&D Syndication development program.

R&D SYNDICATION FOR HELICOBACTER PYLORI TREATMENT

o R&D Syndication funding is an innovative financing technique

which is non-dilutive to existing shareholders and is used to

avoid any drain on the Company's valuable cash resources.

o The funding has been arranged for a three year period to

progress a treatment and preventative for Helicobacter

pylori (H. pylori), the second most common infection in man.

o The R&D Syndication project to be undertaken by Cortecs'

wholly owned subsidiary, the Australian Institute of

Mucosal Immunology ('AIMI') which is based in Newcastle,

Australia, has been assessed and approved by the Australian

Industry Research and Development Board.

o The discovery of the role of H. pylori in peptic ulcers

in Perth, Western Australian has resulted in Australia

becoming a source of one of the most important medical

breakthroughs in the last 20 years.

o If successful, the therapeutic antigen could be used to help

prevent further infection of H. pylori and therefore prevent

ulcer disease from developing which affects over 80 million

patients worldwide and could also help protect against

infection in children should it be deemed appropriate.

o If successful, the therapeutic antigen against H. pylori

will attack one of the largest pharmaceutical markets. The

anti-ulcer market is estimated to be in excess of US$10

billion of which a treatment for H. pylori could represent

an important part.

o Cortecs has already shown that its H. pylori antigen will

protect against infection in an animal model and that its

MACROSOL delivery system enhances immunity following oral

immunization in small animals.

o The H. pylori project continues the building of Cortecs'

expertise in H. pylori research and development together

with its new oral drug delivery systems and the leadership of

AIMI in the area of mucosal immunology and patented antigens.

Cortecs is quoted on the London Stock Exchange, the Australian Stock Exchange and on NASDAQ. The Company specializes in the development of new pharmaceutical delivery systems which enable more cost effective therapies. Cortecs currently has several innovative drug delivery technologies and rapid diagnostic kits under development. The major projects include:

o The oral delivery of biotechnology drugs - MACROMOL, a system

for the oral delivery of biotechnology drugs such as calcitonin 

which has shown positive interim results in Pase II clinical

tests.

o Oral Pseudomonas and oral "Flu" Preventatives and Treatments -

Orally delivered treatments against diseases such as influenza

and also pseudomonas infection (in cystic fibrosis) which is

currently in Phase I/II trials.

o Oral Anti-Diarrhoeal - An oral system to prevent diarrhoea

without antibiotics.

o Point-of-Care Diagnostics - A range of innovative diagnostic

kits including:

o HELISAL - A rapid doctor's office test for the detection

of H. pylori.

o OSTEOSAL - A rapid doctor's office test in development

to measure bone breakdown indicating the process of the

disease Osteoporosis.

o GLYCOSAL - A rapid doctor's office test in development to

assist in the monitoring of the medium and longer-term

control of diabetes.

Cortecs also markets a range of ethical and OTC medicines and diagnostic products.

CONTACT: Cortecs International Limited

Mr. Gary Walton

Perth, Western Australia 

[phone]

or

Kehoe, White, Savage & Co., Inc., New York

Van Negris, 212/888-1616