EPT'S IMPLANT TRIAL EXCEEDS EXPECTATION.

EpiTan Limited [ASX: EPT], Melbourne, Australia, has announced better than expected efficacy in its implant dose escalation trial which commenced in November 2003. The first six volunteers, who received the two lowest levels of the melanin- producing drug Melanotan, quickly demonstrated a substantial increase in melanin levels. After 60 days the volunteers still had a profound natural tan.

The trial is being conducted at Q-Pharm, which is based at the Clive Berghofer Cancer Research Centre at the Queensland Institute of Medical Research (QIMR) in Queensland.

The objective of the trial is to determine an optimal dose for a long-acting implant, as well as safety, compliance and efficacy.

Dr Stuart Humphrey, clinical development manager at EpiTan, said: "We are delighted that the implants have worked so well and so quickly in these first volunteers. However, we didn't anticipate that so little drug would be needed to achieve increased melanin levels. The dose escalation study to determine the optimal dose has been amended to use smaller implants containing much less drug."

Michael Kleinig, pharmaceutical and business development manager, said: "This is good news because less than one tenth of the drug is likely to be required compared to the amount used in last year's successful Phase II aqueous injection trial. This translates into substantial cost benefits for the product when commercialized. A new batch of implants containing a lower dose range is now being produced."

EpiTan now expects the implant trials to conclude in the third quarter 2004. An IND application is still on schedule to be lodged with the USA Food and Drug Administration in mid 2004.

About Epitan

EpiTan Limited (ASX: EPT) is an emerging biotechnology company with a pre-eminent position on the prevention of DNA and skin damage from ultra-violet (UV) radiation exposure. Based in Melbourne, Australia, EpiTan holds a unique technology platform centred on its leading drug candidate Melanotan, one of a new breed of pharmacogenomic drugs.

The company has the exclusive worldwide rights to develop Melanotan which, like sunlight, stimulates the production of melanin in the skin or "melanogenesis" - a unique biochemical process. However, and most importantly, the body's melanin levels are increased before exposure to harmful UV radiation. This will become a new photo-protective tool which will be of significant benefit to people with fair skin types who are most at risk of sunburn injury and therefore of developing skin cancers.

To date the clinical development of Melanotan has been very successful and has now progressed through to the completion in November 2003 of pivotal Phase IIb clinical trials in Australia. These trials conclusively demonstrated that Melanotan consistently elevated skin melanin levels all over the body. This elevated melanin in skin type I/II correlated with a 50% reduction in sunburn injury. A significant reduction in the damage to DNA in the skin cells was also measured. This is the first time that a drug has been demonstrated to induce a protective level of melanin in people who normally cannot be induced to make any significant amounts of melanin. It is also the first time that the protective elements of melanin can be clearly shown in vivo by the fact that the level of melanin could be increased in the skin by means other than by damaging the cells with UV radiation.

EpiTan has now successfully developed a more user-friendly drug delivery formulation of Melanotan in the form of a slow release implant. The implant is injected under the skin and is designed to release the drug at a low level over several days. The single daily aqueous injections used in all previous trials resulted in a high initial dose which rapidly reduced to zero after a few hours. The implant is made from the same material as is used in self-dissolving stitches, is biodegradable and does not have to be removed at the end of the treatment. The implant will be used in the remaining clinical program and the commercialized product.

The company expects to lodge an Investigational New Drug (IND) application with the Food and Drug Administration in order to open the path for sunburn injury clinical trials in the United States starting in mid 2004.

EpiTan is also investigating Melanotan as a therapeutic agent for UV-induced skin allergies such as PMLE and solar urticaria. PMLE is a significant UV-induced skin allergy in northern latitudes and the company expects to begin trials in Europe in early 2004 to examine the ability of Melanotan to alleviate or cure this disorder.

Potential markets worldwide for Melanotan for dermatology purposes are estimated at US$2.5 billion. An even greater market (more than US$5 billion) exists for Melanotan as a new safe (prescription) sunscreen drug.

For more information, visit http://www.epitan.com.au.