DIAGNOSTIC PRODUCTS/COMPUGEN SIGN IMMUNOASSY PACT.

Compugen Ltd. has granted a license to Diagnostic Products Corporation (DPC) to develop and commercialize diagnostic assays based on two novel prostate-specific proteins for the screening, detection and monitoring of prostate and other cancers.

The agreement couples Compugen's recent discoveries of a PSA- linked molecule (PSA-LM) and an hK2-linked molecule (K-LM), with DPC's proven ability and successful history in developing, manufacturing and marketing diagnostic immunoassay-based products worldwide.

Under the terms of the agreement, DPC obtained the exclusive right to develop and commercialize Compugen's prostate-specific proteins for use in the field of cancer immunodiagnostics. In exchange, Compugen will receive undisclosed milestone payments and royalties based on the commercialization of Compugen's intellectual property, including the sales by DPC of any immunoassay-based products.

The discovery of these two novel prostate-specific proteins was announced by Compugen in February 2002. The two proteins are encoded by alternative mRNA splice variants of the genes for prostate- specific antigen (PSA) and a related protein, human kallikrein 2 (hK2). Although these genes have been the subject of intensive worldwide research for the past two decades, the existence of these two splice variants was previously unknown. Their discovery by Compugen was made possible through the predictive capability of the company's proprietary LEADS computational biology platform. The existence of the splice variants has been verified and further investigated in Compugen's molecular biology laboratory. The discovery was published in the Journal of Biological Chemistry 277:20 (May 2002).

"We are enthusiastic about our new partnership with Compugen and the opportunity to develop immunoassays for these novel proteins," said Dr. Dennis Sustarsic, DPC's vice president of Research and Development. "We also look forward to the prospect of expanding the cancer testing capabilities of our customers with new diagnostic assays. This new affiliation is in keeping with DPC's commitment to improving care for all patients, including those with cancer."

Mor Amitai, Ph.D., president and CEO of Compugen Ltd. said, "We are very pleased that our first substantial royalty-bearing agreement is with DPC, a global provider of immunodiagnostic systems and reagents. This alliance is another strong validation of our continuing assertion that Compugen's unique computational biology research results in the discovery of meaningful biological information that would otherwise be extremely difficult to discover solely through experimentation. Our unique approach incorporates the power of the most advanced computational technologies into molecular biology, improving the identification of drug targets and diagnostic markers, thereby increasing the probability of success in drug discovery and development."

Prostate specific antigen (PSA) is the premier tumor marker for screening, diagnosis, monitoring and prognosis of prostate cancer. PSA and human kallikrein 2 are closely related products of human kallikrein genes KLK3 and KLK2, respectively. Both proteins are secreted by the prostate and play important roles as biomarkers in the diagnosis of prostate cancer.

Prostate cancer is one of the most common forms of cancer in men and is the second leading cause of cancer death in men. The American Cancer Society and the American Urological Association recommend that men over age 50 be offered yearly PSA screening tests. The current annual PSA U.S. test market is estimated at $250 million, and the worldwide PSA test market is approximately $500 million.

About Compugen

Compugen (NASDAQ: CGEN) is a pioneer in the merging of computational technologies with biology, chemistry and medicine to enhance drug discovery and development. This unique capability is a proven basis for providing high value products and services to leading biotechnology and pharmaceutical companies and for in-house discovery. For additional information, visit http://www.cgen.com.

About Diagnostic Products Corporation

Founded in 1971, Diagnostic Products Corporation (DPC) is the global leader dedicated exclusively to immunodiagnostic testing. The company's product menu includes over 400 tests to measure medically important substances present at infinitesimal concentrations in body fluids and tissues. DPC also designs and manufactures automated laboratory instrumentation which provides fast, accurate results while reducing labor and reagent costs. DPC sells its products to hospitals, clinics and laboratories domestically and in over 100 countries.

For more information, visit http://www.dpcweb.com or call 310/645-8200.