DUSA Signs Clinical Trial Agreement With The National Cancer Institute, Division Of Cancer Prevention For The Clinical Development Of Levulan 'R' PDT.

WILMINGTON, Mass. -- DUSA Pharmaceuticals, Inc. (Nasdaq:DUSA) today announced the signing of a clinical trial agreement with the National Cancer Institute (NCI) Division Of Cancer Prevention (DCP) for the clinical development of Levulan(R) photodynamic therapy (PDT) for the treatment of high-grade dysplasia (HGD) within Barrett's Esophagus (BE).

DUSA and the NCI DCP will be working together to prepare an overall clinical development plan for Levulan PDT in this indication, starting with a Phase II trial, and continuing through Phase III studies if appropriate,. The immediate plan is for the NCI DCP to solicit clinical protocols from its extramural expert clinical investigator consortium, after which time DUSA and the NCI DCP will finalize the clinical trial design. The NCI DCP will use its resources to file its own IND. DUSA will provide Levulan, device(s) and the necessary training for the investigators involved in the studies. DUSA will maintain full ownership of its existing intellectual property, has options on new intellectual property, and, subject to successful Phase II and III clinical trial results, intends to seek FDA approval in due course.

High-Grade Dysplasia (HGD) in Barrett's Esophagus (BE) patients

DUSA is currently carrying out a single site trial of Levulan PDT in order to gather data on HGD treatment in BE using DUSA's proprietary new endoscopic light delivery system. The anticipated NCI DCP-sponsored Phase II study will also use this light delivery system.

Independent investigator studies have reported that orally administered ALA followed by red laser light selectively treats the epithelial (lining) layer of the esophagus, and ablates HGD without causing strictures (circumferential scarring) or prolonged skin photosensitivity (e.g. 1-2 days).

In DUSA's earlier small clinical trial on the removal of HGD in BE using Levulan PDT, 6 patients received 60 mg/kg Levulan orally, followed 4 to 6 hours later by 200 J/cm fiber of red laser light delivered through a clear balloon catheter (with an average of 2 treatments per patient). Other than the one patient that was dropped from the study early on due to a diagnosis of cancer, all of the remaining 5 patients (100%) had complete removal of HGD, with 4/5 (80%) of those patients maintaining the complete response for the 2-year duration of follow-up. No strictures were reported.

Barrett's esophagus is an acquired condition affecting up to 700,000 patients in the United States, in which the normal esophageal lining is replaced by an abnormal lining that can then become dysplastic. Patients with confirmed high-grade dysplasia (HGD) often undergo major surgery to remove the affected portion of the esophagus. An alternative medical treatment for these patients using PDT was recently approved by the FDA. The approved drug, porfimer sodium (Photofrin(R), Axcan Pharmaceuticals), was effective in Phase III clinical trials, but was associated with skin photosensitivity for up to 4 to 6 weeks, and strictures resulting in the need for repeated esophageal dilatation in 38% of the patients.

Charles Lightdale, MD, Professor of Clinical Medicine, Columbia University College of Physicians and Surgeons and noted gastroenterologist, upon learning of the DUSA/NCI clinical trial agreement, noted "The clinical trials of PDT for Barrett's esophagus with high-grade dysplasia presents a powerful combination that promises new opportunities for the prevention of esophageal cancer."

Stuart L. Marcus, MD, Ph.D., DUSA's VP Scientific Affairs and Chief Medical Officer, stated "We are very pleased that the NCI DCP is bringing its interest and resources to bear on this collaborative clinical development effort. The agreement will allow a full-scale Phase II study of Levulan PDT for HGD in BE to proceed, a crucial step in moving this important indication closer to being an approved therapy widely available to doctors and patients."

DUSA Pharmaceuticals, Inc. is a biopharmaceutical company engaged primarily in the development and marketing of Levulan Photodynamic Therapy (PDT) and Photodetection (PD) for multiple medical conditions, with a primary focus on dermatology. PDT and PD utilize light-activated compounds to induce a therapeutic or detection effect. DUSA is a world leader in topically or locally applied PDT and PD. DUSA maintains offices in Wilmington, MA, Valhalla, NY and Toronto, Ontario.

Except for historical information, this news release contains certain forward-looking statements that involve known and unknown risks and uncertainties, which may cause actual results to differ materially from any future results, performance or achievements expressed or implied by the statements made. These forward-looking statements relate to DUSA and NCI DCP's intention to work together on the clinical development of Levulan PDT, the plans of NCI DCP to solicit clinical protocols, finalization of clinical trial designs, NCI DCP's intention to use its resources to file an IND, DUSA's intention to provide Levulan, devices and training, maintain ownership of potential intellectual property and seek FDA approval of any potential therapy, whether this clinical trial agreement will provide new opportunities for cancer prevention and that the agreement is a crucial step in moving toward regulatory approval of the therapy. Such risks and uncertainties include, but are not limited to, changing market and regulatory conditions, continuing FDA approval of therapies, maintenance of DUSA's patent portfolio, the ability of NCI DCP and DUSA to successfully collaborate on this clinical trial, NCI DCP's success in soliciting clinical protocols, finalization of clinical trial designs, results of clinical studies, the regulatory approval process and other risks identified in our SEC filings from time to time, including those contained in DUSA's Form 10-K for the year ended December 31, 2003.

DUSA PHARMACEUTICALS INC. (NASDAQ:DUSA)