Cubist Issues Common Stock to Lilly in Exchange for Royalty Rate Reduction.

LEXINGTON, Mass. -- Cubist Pharmaceuticals, Inc. (Nasdaq: CBST) today announced that it has completed the issuance of $20 million worth of Cubist common stock to Eli Lilly and Company in connection with the previously announced royalty buy down transaction. The price of the shares, $10.66 per share, is based on the average closing price of the stock over ten consecutive trading days ended March 2, 2005. The number of shares issued was 1,876,173. Cubist's global royalty obligation to Lilly on CUBICIN sales will be reduced by two percentage points, once the issued shares are registered by Cubist or sold by Lilly, whichever comes first.

About Cubist

Cubist Pharmaceuticals, Inc. is a biopharmaceutical company focused on the research, development and commercialization of antiinfective products that meet unmet medical needs. In the U.S., Cubist markets Cubicin(R) (daptomycin for injection), the first antibiotic in a new class of antiinfectives called lipopeptides. CUBICIN is currently the only once-daily bactericidal antibiotic approved in the U.S. with activity against both methicillin-susceptible and methicillin-resistant Staphylococcus aureus (MSSA and MRSA) in complicated skin and skin structure infections. Cubist's pipeline includes HepeX-B(TM), a monoclonal antibody biologic currently in the second of two Phase 2 trials to determine its potential for the prevention of infection by the Hepatitis B virus (HBV) in liver transplant patients, and research efforts focused on novel members of the lipopeptide class of molecules and on natural products discovery. Cubist is headquartered in Lexington, MA.

Cubist Safe Harbor Statement

Statements contained herein that are not historical fact may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and such statements are subject to a variety of risks and uncertainties. There are a number of important factors that could cause actual results to differ materially from those projected or suggested in any forward-looking statements made by Cubist. These factors include, but are not limited to: (i) the level of acceptance of CUBICIN by physicians, patients, third-party payors, and the medical community generally; (ii) Cubist's ability to continue to develop, secure additional regulatory approvals for, and successfully market, CUBICIN; (iii) Cubist's ability to manufacture CUBICIN on a commercial scale; (iv) commercialization of products that are competitive with CUBICIN; (v) Cubist's ability to discover or in-license drug candidates; (vi) Cubist's ability to successfully develop drug candidates in its pipeline, including HepeX-B; (vii) Cubist's ability to successfully commercialize any product or technology developed by Cubist; (viii) Cubist's ability to establish and maintain successful manufacturing, sales and marketing, distribution, and development collaborations; (ix) legislative or regulatory changes adversely affecting Cubist or the biopharmaceutical industry; (x) Cubist's ability to protect its intellectual property and proprietary technologies; and (xi) Cubist's ability to finance its operations. Additional factors that could cause actual results to differ materially from those projected or suggested in any forward-looking statements are contained in Cubist's recent filings with the Securities and Exchange Commission, including those factors discussed under the caption "Risk Factors" in such filings.

Cubist and Cubicin are registered trademarks of Cubist Pharmaceuticals, Inc.; HepeX-B is a trademark of XTL Biopharmaceuticals Ltd.

Additional information can be found at Cubist's web site at www.cubist.com