D-Pharm Achieves First Milestone From Partner Shire Pharmaceuticals For its Proprietary Anti-Epileptic Agent SPD 421.

Business Editors & Health/Medical Writers

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REHOVOT, Israel--(BW HealthWire)--Feb. 28, 2002

D-Pharm Ltd. announced today that it has received the first milestone payment for SPD 421 from its licensing partner Shire Pharmaceuticals Group plc (LSE:SHP.L) (Nasdaq:SHPGY) (TSE:SHQ CN).

The milestone was made to D-Pharm pursuant to the Phase II clinical trial progress of SPD 421 as add-on therapy in the treatment of complex partial seizures.

The worldwide development and commercialization agreement between D-Pharm and Shire was made in March 2000, following an intensive research and development effort by D-Pharm, culminating in a successful Phase I clinical trial in 60 healthy volunteers. Under the license agreement, Shire is responsible for clinical development and registration of the product. Moreover, the economics of the licensing deal include, among others, cash payments to D-Pharm upon the achievement of certain clinical, regulatory and commercial milestones.

SPD 421 (formerly designated DP-VPA) is a unique phosphatidyl-choline conjugate of valproic acid, a drug widely used for the treatment of epilepsy, bipolar disorder and migraine prophylaxis. SPD 421 is a new chemical entity generated using D-Pharm's proprietary technology, Regulated Activation of Prodrugs (D-RAP(TM)), which enables precise control over drug action at the site of pathology. In particular, SPD 421's anti-seizure effects are regulated in direct response to `metabolic' activity at the epilepsy focus in the brain. Preclinical and Phase I results demonstrate a unique safety and pharmacokinetic profile of the drug. "The use of SPD 421 in patients is a tremendously exciting event for D-Pharm," stated Dr. Alex Kozak, D-Pharm's President and CEO. "SPD 421 is D-Pharm's first and most advanced D-RAP(TM) product, so we are looking forward to seeing our efforts finally benefit patients."

The worldwide market for anti-epileptics in 1999 was valued at over $3.0 billion and is projected to grow to $4.5 billion by 2005. Yet, the market is still largely under-served, with about 20-25% of epilepsy patients still refractory to current anti-epileptic drug treatments. Patented formulations of valproic acid (Depakote(R), Depakine(R)) are first-line drugs of choice for epilepsy and generate approximately $900 million in global sales annually for epilepsy, bipolar disorder and migraine prophylaxis indications. However, despite excellent efficacy, a variety of adverse effects limit valproic acid's maximum dose and use, mainly in women and children. SPD 421 was developed to safely serve the needs of this patient population, as well as extend its use to refractive epilepsy patients. Moreover, by reducing doses and side effects it may be possible to expand the use of this important therapeutic agent in additional indications. `Composition of Matter' patents have been filed in all major countries worldwide and have already been granted in the US, Australia and New Zealand.

Shire Pharmaceuticals Group plc

Shire is a rapidly growing international specialty pharmaceutical company with a strategic focus on four therapeutic areas -- central nervous system disorders, oncology, anti-virals and biologics. For further information on Shire Pharmaceuticals, please visit the company's website: www.shire.com

D-Pharm Ltd.

D-Pharm (www.dpharm.com) is a biopharmaceutical company pioneering the development of lipid-based therapeutic strategies, both for drug targeting and for drug discovery. To this end, D-Pharm has developed a set of three unique technologies, (i) Regulated Activation of Prodrugs (D-RAP(TM)); (ii) Membrane Activated Chelators (MAC); and (iii) LipidoMimetix(TM), which have enabled the company to generate a rich pipeline of preclinical and clinical products in diverse medical fields. To date, the Company has developed programs in neurological disorders, cerebrovascular disease, autoimmune and inflammatory disorders, as well as cancer. In addition to the clinical development of SPD 421, D-Pharm is conducting a European Phase II clinical trial in stroke patients, to assess the safety and pharmacokinetic profile of DP-b99, its MAC-based, novel proprietary neuroprotective compound.

The company's business strategy is to develop its products through `proof of principle - in - man' and to seek partners for further clinical development and commercialization. In addition, D-Pharm has R&D collaborations with Nycomed Amersham Imaging and with Eli Lilly & Company, with the objective of applying its D-RAP(TM) technology as a platform to improve the pharmacological profiles of their respective proprietary CNS development candidates.