Enzon and Inhale Name First Collaborative Project.

Business Editors, Health/Medical Writers

Enzon, Inc. (NASDAQ:ENZN) and Inhale Therapeutic Systems, Inc. (NASDAQ:INHL) announced today the first collaborative project to be developed using Inhale's pulmonary delivery or supercritical fluids platforms under the broad strategic alliance announced between the companies on January 7, 2002.

The first product will be an inhaled formulation of leuprolide acetate, a peptide analog used to treat prostate cancer and endometriosis. In 2001, worldwide sales of injectable formulations of leuprolide acetate were reported to be approximately $1.5 billion.

"The leuprolide formulation using Inhale's pulmonary delivery platform is a natural extension of our established strategy of improving upon an already successful molecule with known therapeutic efficacy," said Arthur J. Higgins, Enzon's chairman and chief executive officer. "We are pleased to name our first collaborative project with Inhale and we are confident that this partnership will continue to contribute to the expansion of our product pipeline."

In November 2001, Inhale announced positive results from a first in human clinical study of inhaleable leuprolide. The 12-person European study suggested that clinical doses of leuprolide could be given as once-a-day single inhalations. These results will be the starting point to perform the necessary studies to prepare the product for the filing of an Investigational New Drug Application (IND) with the U.S. Food and Drug Administration. At such time when the product is IND ready, Enzon has the option to assume clinical development activity.

"We believe that Enzon will be an excellent commercialization partner who can utilize our technology to develop breakthrough products such as inhaleable leuprolide. Further, we are pleased that we can offer a product that has already been tested in humans to help accelerate time to market. We look forward to expanding our relationship as Enzon selects additional products for our drug delivery technologies," said Ajit Gill, president and chief executive officer of Inhale.

As per the terms of the strategic alliance, Inhale will be primarily responsible for the formulation and manufacture of the final product and Enzon will be responsible for clinical development, regulatory filings and commercialization of the final product. Inhale will cover all preclinical and formulation expenses necessary to file an Investigational New Drug Application (IND) with the U.S. Food and Drug Administration and will receive development milestone payments and royalty payments from Enzon.

Inhale Therapeutic Systems, Inc., provides a portfolio of drug delivery technologies to enable improved performance of drug products. Inhale offers three leading drug delivery platforms: PEGylation for enhanced delivery performance of most major drug classes, including macromolecules and small molecules; a suite of technologies for the inhaleable delivery of macromolecules and small molecules for systemic and local lung delivery; and particle engineering with supercritical fluid technology to easily control particle shape and size for a variety of drug delivery applications. The Company is collaborating with major pharmaceutical and biotechnology companies, including Amgen, AstraZeneca, Aventis Behring, Bristol-Myers Squibb, Chiron, Enzon, GlaxoSmithKline, Johnson & Johnson, Lilly, Pfizer, Pharmacia, Roche, Schering-Plough and Serono. Additional information about Inhale is available on the Company's WEB site at www.inhale.com.

Enzon is a biopharmaceutical company that develops and commercializes enhanced therapeutics for life-threatening diseases through the application of its proprietary platform technologies: PEG Modification and single-chain antibodies (SCA(R)). Three products are currently marketed which utilize Enzon's technology: PEG-INTRON marketed by Schering-Plough for hepatitis C, ONCASPAR(R) for Acute Lymphoblastic Leukemia (ALL), and ADAGEN(R) a treatment for a form of Severe Combined Immunodeficiency Disease (SCID), commonly known as the "Bubble Boy Disease." In addition to three approved products, Enzon has several products in various stages of clinical development by itself and with partners, including additional indications for PEG-INTRON with Schering-Plough. A Phase III clinical trial is being conducted for PEG-INTRON for the treatment of malignant melanoma. Enzon develops and markets products on its own and through strategic alliances and licensing arrangements, which in addition to Schering-Plough Corporation, include Alexion Pharmaceuticals, Inc., Aventis, Baxter HealthcareCorporation, Bristol-Myers Squibb Company, Eli Lilly & Company, Inhale Therapeutics Systems, Inc., and Micromet AG.

Except for the historical information herein, the matters discussed in this news release include forward-looking statements that may involve a number of risks and uncertainties. Actual results may vary significantly based upon a number of factors, which are described in the Enzon's Form 10-K, Form 10-Q's and Form 8-K's on file with the SEC, including without limitation, risks that the parties are unable to agree to terms and conditions of a commercialization agreement, the risk that developing technology may not ultimately be determined to be viable or that development efforts may be delayed or that approved indications may be limited, risks in obtaining and maintaining regulatory approval for indications and expanded indications, market acceptance of and continuing demand for Enzon's products and the impact of competitive products and pricing.

This release contains forward-looking statements that reflect the current views of Inhale management as to future products, product development, and other future events and operations. These forward-looking statements involve uncertainties and other risks that are detailed in reports and other filings with the Securities and Exchange Commission, including the Form 10-K for 2001. These documents identify important factors that could cause the Company's actual performance to differ from current expectations, including the outcome of clinical trials, regulatory review, manufacturing capabilities and marketing effectiveness.

This release is also available at

http://www.enzon.com and http://www.inhale.com