Cypress Bioscience Discussing Progress with Fibromyalgia Initiative at Annual Meeting.

Business Editors/Health & Medical Writers

SAN DIEGO--(BW HealthWire)--July 27, 2001

Cypress Bioscience Inc. (Nasdaq:CYPB) is highlighting its new strategic focus -- discovery and development of products that improve the diagnosis and treatment of patients with FMS -- at its annual meeting today.

FMS affects two to four percent of the world's population with total annual patient costs in the billions of dollars. It is the second most commonly diagnosed rheumatologic disorder after osteoarthritis.

"We launched our FMS program to address a very exciting opportunity with the goal of bringing added value to our stockholders by developing and marketing the first approved drug for this chronic and debilitating condition," said Jay D. Kranzler, M.D., Ph.D., chairman and chief executive officer of Cypress Bioscience Inc., "Over the past several months, we made a number of noteworthy advances towards building core capabilities in this field."

"Our genomic program advances our goal of cutting edge discovery research directed at understanding FMS pathophysiology and therapeutic approaches. At the same time, to accelerate commercialization, we have identified a number of exciting drug candidates with the potential to help FMS patients and expect to announce the signing of our first in-licensing deal during the current quarter. Pending certain regulatory clearances, we plan to begin clinical trials on this compound soon after the signing of the agreement. We have on-going efforts to license additional drug candidates."

FMS Program Milestones

Since the inception of the FMS program earlier this year, Cypress has announced several significant initiatives. In March, the company signed a research agreement with Georgetown University Medical School (Georgetown) to identify and develop technologies and products for FMS diagnosis and treatment. Georgetown is currently the largest recipient of government funding for FMS and chronic fatigue research in the U.S. Cypress was granted an exclusive right of first negotiation to acquire a license under certain inventions discovered under the agreement related to the treatment of FMS.

Cypress this month began its genomic research program to better understand the genetic factors associated with FMS and aid in the discovery of novel diagnostic tools and drug targets. Published studies have shown that patients with FMS may have a genetic predisposition to the condition. The company intends to create the largest database of genetic information on well-characterized FMS patients for analysis. The program will include collecting and evaluating blood samples and phenotypic data such as medical and treatment history from FMS patients. The company is also constructing registries of FMS patients and physicians with large FMS practices as well as creating a Web site devoted to FMS information.

Because the treatment of FMS requires a multidisciplinary approach, Cypress in April and July established two advisory boards bringing together thought leaders who are skilled in FMS with specialists with know-how in the mechanisms of drugs that are currently used to treat this disorder. The advisory boards are made up of rheumatologists, psychiatrists, neuroscientists, psychopharmacologist, and pain specialists. The company is also working with world-class researchers in the fields of genetics and genomics.

During the second quarter, two members of the company's Psychopharmacology Advisory Board were named to the Cypress Board of Directors. Charles B. Nemeroff, M.D., Ph.D. is the chairman of the Department of Psychiatry and Behavioral Sciences at the Emory University School of Medicine in Atlanta. He is a distinguished and internationally renowned educator, physician and researcher in the field of psychiatry. Martin B. Keller, M.D. is the chairman of the Department of Psychiatry and Human Behavior at the Brown University School of Medicine in Providence, R.I. He is a leading expert in the treatment of long-term psychiatric illnesses and the effect of neuropsychopharmacologic compounds and psychotherapy on the short and long-term clinical course of these illnesses in adolescents and adults. Cypress also appointed Sheldon Drobny to its Board. Drobny is currently chairman, principal and managing director of the Paradigm Group LLC, an investment firm focused on venture capital and investment banking services for multiple industries with an emphasis on technology-based companies.

Cypress also strengthened its senior management team by appointing John N. Bonfiglio, Ph.D. to executive vice president and chief operating officer. Dr. Bonfiglio has extensive operational experience and a strong technical and business development background suited to the company's ongoing efforts to identify, license and develop drugs to treat FMS.

Cypress is the developer of the PROSORBA(R) column, a medical device for the treatment of rheumatoid arthritis that is approved for sale in the United States, Europe and Canada. At the beginning of this year, Cypress revised its core strategy in response to the slower than anticipated market acceptance of the PROSORBA column. The company transferred worldwide responsibility for all sales, marketing, clinical and regulatory activities and expenses for the PROSORBA column to Fresenius Hemocare Inc. in exchange for an upfront payment and the potential to receive future royalties on sales above certain thresholds.

About Cypress Bioscience Inc.

Cypress is committed to be the innovator and commercial leader in providing products that improve the diagnosis and treatment of patients with FMS. FMS is characterized by chronic and widespread pain and stiffness throughout the body accompanied by severe fatigue, poor sleep and headache. Patients with FMS have at least comparable disability, more pain and lower quality of life than patients with rheumatoid arthritis or osteoarthritis. Current treatment options are limited as there are no drugs specifically approved by the U.S. Food and Drug Administration for the treatment of FMS. For more information about Cypress, please visit the company's Web site at www.cypressbio.com.

This press release, as well as Cypress' SEC filings and Web site at http://www.cypressbio.com, contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could vary materially from those described as a result of a number of factors, including those set forth in Cypress Annual Report on Form 10-K and any subsequent SEC filings. In addition, there is the risk that the FMS program will not bring added value to our stockholders; that Cypress may not be able to successfully develop or market any products for the treatment of FMS; that any of the drug candidates that have been identified for treatment of FMS will actually prove effective in treating FMS, or even if effective, that the company will commercialize such drug candidates, or be successful in establishing collaborative arrangements to obtain access to specific development candidates or products for FMS during this quarter, that we may not begin clinical trials on an in-licensed compound soon after signing such agreement; that the genomic program will not result in the discovery of diagnostics and drug for FMS; or that Cypress will be successful in identifying or developing products under the Georgetown agreement. Cypress undertakes no obligation to revise or update these forward-looking statements to reflect events or circumstances after the date of this press release, except as required by law.