Coulter Pharmaceutical and SmithKline Beecham Form Development and Commercialization Alliance for I-131 Anti-B1 Antibody.

PALO ALTO, Calif.--(BW HealthWire)--Dec. 4, 1998--Coulter Pharmaceutical (Nasdaq:CLTR) and SmithKline Beecham (NYSE:SBH) today announced that they have signed an agreement to jointly commercialize Coulter's lead cancer therapy, I-131 Anti-B1 Antibody (iodine I 131 tositumomab), which is in late-stage development for the treatment of non-Hodgkin's lymphoma (NHL).

The total agreement has a potential value of up to $132 million, plus shared profits and royalties.

The agreement provides for an upfront payment of $41.5 million from SmithKline Beecham (SB) to Coulter Pharmaceutical, including the purchase of $7.25 million in equity. In addition, a $15 million credit line will be provided. Coulter potentially will receive an additional $76 million in payments based upon completion of certain milestones in specific geographical areas of the world.

Future development expenses for I-131 Anti-B1 Antibody will generally be shared by both companies, with Coulter retaining responsibility for funding certain predetermined development costs. In addition, the companies will jointly explore the potential of the I-131 Anti-B1 Antibody therapy for other indications.

Coulter and SB will jointly market I-131 Anti-B1 Antibody in the United States following regulatory approval, and the two companies will share profits equally. Outside the United States, excluding Japan, Coulter has granted SB exclusive marketing and distribution rights in return for product royalties. SB will also have access to second generation anti-CD20 compounds.

"We are very pleased to establish this partnership with SB given their commitment to the cancer field and successful record in marketing leading oncology products such as Kytril(R) and Hycamtin(tm)," said Michael F. Bigham, president and chief executive officer of Coulter.

"The structure of this alliance allows us to build our own oncology sales force and to actively participate in marketing within the United States. Our efforts will be coordinated with SB's well-established, global sales and marketing organizations which we believe will accelerate and broaden the accessibility of I-131 Anti-B1 Antibody therapy to NHL patients."

"SmithKline Beecham's Oncology group is committed to the discovery, development and marketing of innovative products that provide greater hope and improved clinical care to people who suffer from the many diseases collectively known as cancer," said Jean-Pierre Garnier, chief operating officer of SB.

"While there have been many advances in our understanding of a wide variety of cancers in the past few years, a critical need for effective treatments remains. We believe Coulter's I-131 Anti-B1 Antibody promises to be an important product that will support SB's continued commitment to cancer patients and enable SB to provide oncologists with an effective product to treat NHL."

I-131 Anti-B1 Antibody, an antibody conjugated to iodine 131, attaches to the CD20 antigen. This antigen is found only on the surface of B-cells, including both non-Hodgkin's lymphoma B-cells and some normal B-cells. It is believed that through this targeted approach, the tumor cells receive a greater concentration of the therapeutic radiation from I-131 Anti-B1 Antibody relative to normal tissues.

Non-Hodgkin's lymphoma is a form of cancer that affects the blood and lymph tissues. NHL currently is the sixth leading cause of death among cancers in the United States and has the second fastest growing mortality rate.

According to statistics from the National Cancer Institute, approximately 270,000 people are afflicted with NHL in the United States alone. Of these, Coulter estimates that approximately 140,000 people have low-grade or transformed low-grade disease which is the initial targeted indication for I-131 Anti-B1 Antibody therapy. There are approximately 54,000 new cases of NHL diagnosed each year.

Coulter Pharmaceutical, Inc. is engaged in the development of novel drugs and therapies for the treatment of people with cancer. The company is developing a family of cancer therapeutics based upon two drug discovery programs: therapeutic antibodies and targeted oncologics.

The company's most advanced investigational product candidate, I-131 Anti-B1 Antibody (iodine I 131 tositumomab), consists of a monoclonal antibody conjugated with a radioisotope. The company has completed a Phase III investigational clinical trial for the treatment of non-Hodgkin's lymphoma and is currently preparing the data for submission to the U.S. Food and Drug Administration. The company also is currently developing a tumor-activated peptide pro-drug version of doxorubicin to treat certain solid tumor cancers.

SmithKline Beecham -- one of the world's leading healthcare companies -- discovers, develops, manufactures and markets pharmaceuticals, vaccines, over-the-counter medicines and health-related consumer products, and provides healthcare services including laboratory testing, disease management and pharmaceutical benefit management. For company information, visit SmithKline Beecham on the World Wide Web at http://www.sb.com.

Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements that involve risks and uncertainties, including uncertainties related to product development, uncertainties related to the need for regulatory and other government approvals, dependence on proprietary technology, uncertainty of market acceptance of I-131 Anti-B1 Antibody or Coulter's other product candidates and other risks detailed from time to time in Coulter's filings with the Securities and Exchange Commission (SEC). In particular, see "Risk Factors" in Coulter's Registration Statement on Form S-3, as amended, filed with the SEC on July 31, 1998.