Department of Defense Medical School and Hollis-Eden Form Collaboration to Develop Drug for Protection Against Radiation Damage.

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SAN DIEGO--(BW HealthWire)--Feb. 14, 2002

Hollis-Eden Pharmaceuticals, Inc. (NASDAQ:HEPH), a pharmaceutical company located in San Diego, California, today announced the signing of a Cooperative Research and Development Agreement (CRADA) with the Uniformed Services University of the Health Sciences (USUHS) and The Henry M. Jackson Foundation for the Advancement of Military Medicine, Inc. (HMJF). USUHS is a fully accredited federal school of medicine administered by the U.S. Department of Defense and is located in Bethesda, Maryland. HMJF, located in Rockville, Maryland, is a private, not-for-profit organization chartered by Congress to support medical education and research at USUHS and throughout the military medical community. The CRADA provides for joint development of Hollis-Eden's investigational drug, HE2100, for use in the area of radiation protection. Hollis-Eden will retain all commercial rights to HE2100, including rights to supply the compound to the U.S. Government.

In discussing the CRADA, Vice Admiral James A. Zimble, M.D. (U.S. Navy retired), President of USUHS, stated, "We view this as an important investment in our national security. With the events of September 11th and subsequent reports of terrorist threats to use nuclear radiation as a weapon in some manner, including through the use of 'dirty bombs,' the need for a practical radioprotectant has never been more acute. While more testing needs to be performed with HE2100, it represents a potential breakthrough in this important area of medical research."

Representatives from the Armed Forces Radiobiology Research Institute (AFRRI), a research institution/department within USUHS, were informed by the U.S. Food and Drug Administration (FDA) in November 2001, that HE2100 will qualify for review for radiation protection under a proposed new rule published in the Federal Register of October 5, 1999 vol. 64, no. 192, if this rule is finalized. Traditional drug development programs require large-scale clinical studies to establish efficacy in humans. However, pursuant to the proposed rule, in cases where traditional efficacy studies would be deemed unethical in evaluating a drug intended for use against lethal or permanently disabling toxic substances (such as in this situation which would otherwise require healthy human volunteers to be exposed to potentially lethal effects of radiation), approval may be granted solely on the basis of proof of efficacy in several animal species and proof of safety in humans.

AFRRI is a leader in studying the short and long-term effects of radiation injury. A principal AFRRI mission is the development of pharmaceutical agents that can be used prophylactically to prevent injury from radiation caused by a nuclear accident or event. Over the past several years, AFRRI, in concert with another Department of Defense project, has screened thousands of compounds in an effort to find a radioprotectant suitable for widespread use. Out of this screening and profiling effort, HE2100 has emerged as a leading candidate based on its striking efficacy in preclinical models to date, its safety profile, and the comparatively low-cost nature of its manufacturing process. AFRRI has conducted numerous preclinical studies with HE2100. Results of several of these studies have been published in the International Journal of Immunopharmacology and in Radiation Research. These studies showed that HE2100, when given to animals shortly before or shortly after exposure to lethal doses of radiation, provided significant survival advantages in HE2100 treated animals versus placebo treated animals.

AFRRI investigators conducting the study attributed the survival advantage to HE2100's ability to increase a number of cell types (including neutrophils and platelets) associated with immune protection.

"We are very encouraged by the protective results we have seen with HE2100 in our models of radiation injury," stated Dr. Thomas Seed, Team Leader, Radiation Casualty Management at AFRRI. This sentiment was echoed by Dr. Mark Whitnall, the principal staff investigator on the project at AFRRI, in highlighting the preclinical findings. "In the experiments we have conducted, a single injection of the compound has produced survival rates in treated animals as high as 100% after exposure to a level of radiation that is rapidly fatal in 80% or more of placebo treated animals."

U.S. Army Colonel Robert Eng, Ph.D., Director of AFRRI added, "We have been searching for an effective and practical radioprotectant for a number of years and this compound appears to date to meet all of our criteria. We are excited by the opportunity to work closely with Hollis-Eden, which has substantial expertise in the development of immune regulating hormones, in an effort to quickly develop this compound for an important and as yet unserved indication. We are also pleased that the FDA has indicated to us that, in the setting of radioprotection, HE2100 will qualify for evaluation under the proposed new rule for experimental drugs that will be used against lethal or permanently disabling toxic substances. While the demand for a novel radioprotectant is difficult to estimate at this time, the need for rapid treatment after radiation exposure, and the diverse nature of the threat, may make HE2100 a candidate for stockpiling on a local as well as a federal and international level."

"This agreement paves the way for us to cooperate closely with the U.S. Armed Forces on developing a novel radioprotectant for use by both military personnel as well as civilians at risk of exposure to high doses of radiation," stated Richard Hollis, Chairman and CEO of Hollis-Eden. "In light of recent world events, it is an honor and a privilege to be collaborating with scientists at AFRRI on a project that is potentially so important to our homeland defense, and we share their sense of urgency on the need to quickly develop this compound."

"We believe this collaboration with the U.S. military provides further validation of the valuable role immune regulating hormones can potentially play in treating a variety of diseases and conditions, including some of the major health threats confronting the world today," Hollis added. "In addition to our work with HE2100 in the area of radioprotection, we have also recently shown exciting results in an initial clinical trial with our lead immune regulating hormone, HE2000, in the setting of malaria, a disease which strikes more than 300 million people each year. Hollis-Eden has been collaborating for a number of years with the U.S. Navy in the area of malaria. HE2000 has also shown encouraging results when given as a single agent to HIV patients in South Africa, which implies that the compound may be useful in increasing the percentage of patients who are long-term non-progressors towards AIDS. Given the attractive safety profile to date and the cost-effective nature of the manufacturing process, HE2000 may represent a practical alternative that could potentially provide relief in epidemics that are affecting millions of patients around the world. Further, based on its mechanism of action, which involves boosting the immune system rather than directly attacking the pathogen itself, we believe HE2000 will not lead to the development of resistance, which is an issue with current approaches to both malaria and HIV. This mechanism of action also implies the compound may be useful against a variety of other pathogens including those that may be used in biowarfare, and we are currently exploring these opportunities with other branches of the U.S. military."

Hollis-Eden Pharmaceuticals, Inc. is a development-stage pharmaceutical company based in San Diego, California, engaged in the development of products for the treatment of infectious diseases and immune systems disorders. The Company's vision is to become the world leader in immune regulating hormones and their application to numerous diseases. Hollis-Eden is conducting a series of Phase I/II and Phase II clinical trials in HIV patients with the Company's lead immune regulating hormone, HE2000, in South Africa and the United States. Phase II studies in Thailand are also being conducted with HE2000 in the treatment of malaria, and in Singapore for the treatment of hepatitis B. The Company is also conducting a Phase I clinical trial in the United States with another of its immune regulating hormones, HE2200, which along with HE2100 is licensed from Dr. Roger Loria, a Professor at Virginia Commonwealth University. In addition, through its relationship with Aeson Therapeutics, the Company also has access to HE2500, which is in Phase II clinical trials in cardiovascular disease and actinic keratosis. For more information on Hollis-Eden, contact the Company's website at www.holliseden.com.

Statements made in this press release may constitute forward-looking statements and are subject to numerous risks and uncertainties, including the potential inability of the U.S. government and the Company to provide the resources necessary to conduct the program described above, the failure to successfully complete clinical trials, the Company's future capital needs, the Company's ability to obtain sufficient funding and required regulatory approvals, the development of competitive products by other companies, and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission. The actual results may differ materially from those contained in this press release.

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