Diatide NeoTect Diagnostic for Lung Cancer Available for Sale In U.S.; Second Product Launch for Diatide in One Year.

LONDONDERRY, N.H.--(BW HealthWire)--Sept. 7, 1999--

Diatide, Inc. (Nasdaq:DITI) today announced the availability of NeoTect(TM) (kit for the preparation of technetium Tc 99m depreotide injection). NeoTect(TM) is a novel imaging agent designed to help physicians distinguish benign and malignant lung masses. There are an estimated 170,000 new cases of lung cancer diagnosed in the U.S. each year. NeoTect(TM) was approved for use by the U.S. Food and Drug Administration August 3, 1999.

"NeoTect(TM) is the second in a class of new disease specific diagnostic imaging agents designed to help physicians identify and localize the specific disease they are seeing by x-ray techniques," said Richard T. Dean, Ph.D., Diatide's President and CEO. "These products have the potential to rapidly provide the physician more information at less cost and with less side effects than currently available technology."

NeoTect(TM) (kit for the preparation of technetium Tc 99m depreotide injection) is indicated to identify somatostatin receptor-bearing pulmonary masses in patients presenting with pulmonary lesions on computed tomography (CT) and/or chest x-ray who have known malignancy or who are highly suspect for malignancy. The methods for determining malignancy today are invasive. Biopsy has a complication rate of approximately 14%. Although NeoTect(TM) is not considered an alternative to CT or biopsy, Diatide believes that NeoTect(TM) can provide important information to help physicians determine whether a lung mass is malignant or benign. NeoTect(TM) can deliver this key information to a physician via a noninvasive procedure, yielding significant patient benefit and savings to the healthcare system.

NeoTect(TM) will be copromoted with Diatide's marketing partner for this product, Nycomed Amersham Imaging.

How NeoTect Works

NeoTect(TM) is administered through an intravenous injection in the arm without the pain and complications associated with biopsy and chest surgery. The result of Diatide's proprietary Techtide(R) technology, NeoTect(TM) uniquely combines a small-molecule synthetic peptide with technetium-99m. The peptide is designed to adhere to somatostatin receptors that are present in several types of cancer, while the technetium-99m emits a gamma ray that is detectable by widely available gamma camera systems.

NeoTect Clinical Background

Approval of NeoTect(TM) was based in part on clinical information from two pivotal, multicenter trials, which involved 270 patients. The studies compared "blind" reads of NeoTect(TM) images for agreement with histopathologic diagnosis for the lesion under evaluation. NeoTect(TM) was found to be a safe and effective technique for the evaluation of pulmonary masses in patients with known or suspected malignancy.

Building on the growing body of clinical work on NeoTect(TM) an abstract dealing with the cost effectiveness of NeoTect(TM) also has been published. In the abstract, which appeared in the May 1999 supplement to the Journal of Nuclear Medicine, Samuel S. Gambhir, M.D. of the University of California at Los Angeles School of Medicine, and his colleagues suggested that NeoTect(TM) can significantly reduce the overall cost of care in patients with undiagnosed small lung masses. The authors concluded that NeoTect(TM) scanning is a cost-effective treatment modality with the potential to save $50.4 million in healthcare costs a year nationwide. They added that NeoTect(TM) "may outperform FDG-PET" in cost-effectiveness.

In NeoTect(TM) clinical trials involving 647 patients, 4.5% experienced side effects. The most commonly reported side effects were headache (1%) followed by dizziness (0.8%), and nausea (0.6%). Most of these events were mild and not considered to be treatment-related.

Diatide's corresponding cancer therapy product, NeoTide(TM), using the same target as NeoTect(TM), is expected to enter clinical trials late this year or early next year. This is part of Diatide's "Find, Fight and Follow" strategy with its unique patented targeting technology.

Diatide, based in New Hampshire, is a specialty pharmaceutical company developing a novel line of disease-specific imaging and therapeutic agents - Techtides(R) and Theratides(TM) - as pharmaceuticals with commercial and medical promise. Diatide has applied its patented technologies in the areas of peptide engineering and radiolabeling chemistry to produce a number of small molecules that bind with high affinity and specificity to targets on diseased tissue and to which a radioisotope can be attached for imaging or therapeutic purposes.

Diatide's first product, AcuTect(TM) for the imaging of acute deep vein thrombosis (blood clots) in the legs, received marketing approval in September 1998 and was launched in October 1998. For NeoTect(TM) and AcuTect(TM) Diatide has a marketing and sales collaboration with Nycomed Amersham. Diatide is actively seeking corporate alliances for its cancer therapy products and other imaging products in its pipeline. Diatide owns 45 issued U.S. patents and 55 granted foreign patents, and has licensed rights to seven additional U.S. patents and their foreign counterparts.

More information on the Company can be obtained from its web site, http://www.diatide.com.

This press release contains forward-looking statements that involve a number of risks and uncertainties. For this purpose, any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, the words "believes," "anticipates," "plans," "expects," "intends," and similar expressions are intended to identify forward-looking statements. Important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are set forth under the caption "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations - Risk Factors" ("Risk Factors") in the Company's Annual Report on Form 10-K for the year ended December 31, 1998 which is on file with the Securities and Exchange Commission. These Certain Factors are incorporated herein by reference. As more fully described in the Certain Factors, the Company's potential products (other than AcuTect(TM) and NeoTect(TM)) are all still in development; there can be no assurance that the Company's potential products will demonstrate the safety, efficacy, and cost attributes currently expected by the Company; there can be no assurance that the Company will receive regulatory approvals to commence or continue clinical trials of product candidates, or to market such products; and, there can be no assurance that AcuTect(TM), NeoTect(TM), or the Company's other potential products will be commercially successful, or accepted by the medical community or third-party payors, or that technologies, patents and proposed products of other companies will not render the Company's products obsolete or noncompetitive.

Ordering Information

NeoTect will be sold to commercial radiopharmacies. For more information, or to place an order, call the Diatide Customer Service Department at 1-877-Diatide.