DrugAbuse Sciences Raises $2.3 Million in Venture Financing Round; Clinical Trials Near On First Drug Candidate.

MENLO PARK, Calif.--(BW HealthWire)--April 7, 1999--DrugAbuse Sciences, Inc., a privately held specialty pharmaceutical company dedicated to addiction care, today announced completion of a venture capital financing raising $2.3 million in new equity.

This round of financing included previous investors Partech International of San Francisco and Paris, CDC Innovation and Financiere de Brienne, both of Paris and several private investors. This financing also included several significant contributions from a select group of new institutional and private investors in the United States.

"This financing round exceeded our initial funding target, reflecting strong interest from a broad cross-section of the investment community in both the United States and Europe," said Stanley A. Kaplan, President and CEO of DrugAbuse Sciences. "These funds, plus $3 million in French government research grants, will enable the company to accelerate its first human trials this summer with lead product candidate NALTREL(TM), for the treatment of alcohol and heroin abuse, and progress its development of COC-AB(TM), a break-through treatment for cocaine overdose."

NALTREL is a slow release form of naltrexone for administration by intramuscular injection on a monthly basis. It has been developed to help alcoholics and heroin addicts overcome the compliance problems they experience with the currently available tablet form of naltrexone, which must be taken daily. Based on existing safety and efficacy data for naltrexone and safety data for the depot delivery system, as well as the limited, short-term clinical trials required for a new formulation, the company believes NALTREL is a near-term, low-risk product for development. The investigational new drug application (IND) has been filed with the FDA and the first clinical human trial with NALTREL is expected to start this month.

"These trials with NALTREL are not only an important milestone for the Company but also for the community," said David E. Smith, M.D., founder and President of the Haight Ashbury Free Clinics, past president of the American Society of Addiction Medicine (ASAM), and Medical Director for DrugAbuse Sciences. "We need to treat addiction as a disease. Many alcoholics and heroin addicts desperately seek our help but successful treatment requires more than just psychotherapy, such as improved medications like NALTREL, to help us break the cycle of addiction."

DrugAbuse Sciences is also developing a cocaine antibody, COC-AB, for the treatment of cocaine overdose. Many patients die as a result of drug overdoses and currently there are no cocaine-specific medications for treating those addicts that are admitted to the emergency room for treatment of cocaine toxicity. COC-AB is designed to act as a cocaine antidote, recognizing and binding to cocaine with high affinity, and this facilitates the rapid extraction of cocaine from the two key organs associated with its toxicity; the brain and heart. This complex of antibody with cocaine circulates in the bloodstream until it is rapidly eliminated from the body. DAS has already received its first patent on the immunogen and a second patent is in process. COC-AB is scheduled to go into Phase I clinical trials by early 2000.

DrugAbuse Sciences has now raised a total of $9.3 million from venture capitalists, private investors and French government R&D grants. Unlike traditional drug development companies, DrugAbuse Sciences is focusing on using established technologies for developing novel low-risk, patented products that can be researched and approved for marketing in a relatively short period of time. Throughout this endeavor the Company has maintained strict control of its expenditures, burning approximately $4 million cumulatively since inception four years ago. The Company is now poised to enter the clinic with its first product candidate, NALTREL. DrugAbuse Sciences near-term financial goal is to maintain a low burn rate, limit dilution, take the Company public at a highly attractive valuation and become profitable based on its first near-term product candidates.

Addiction is the largest public health care problem in Western society and places a tremendous health, social and economic burden on individuals, families, communities and governments. More than 30 million people worldwide battle chronic drug and alcohol abuse every year but few effective treatments are available. To address this void, by developing improved treatments for combination with effective psychosocial programs, Philippe Pouletty, M.D., who serves as Chairman of the Board, founded DrugAbuse Sciences.

DrugAbuse Sciences is the first specialty pharmaceutical company dedicated to addiction care. The Company is focused on developing a comprehensive portfolio of pharmaceuticals and related products to offer a disease management approach to the treatment and management of chronic substance abuse. The Company has three product candidates in development: NALTREL, for treatment of heroin addiction and alcoholism; COC-AB, for emergency treatment of cocaine overdose; and an immunotherapy technology for developing treatments for chronic abusers of cocaine and other drug stimulants. The Company intends to expand its portfolio of products by applying its platform technology to other substance abuse targets, and licensing agreements. DrugAbuse Sciences was founded in 1994 and is based in Menlo Park, California and Paris, France.