Hemispherx Biopharma Launches Experimental Program to Treat Potential Smallpox Outbreaks; New Research Shows Virus Launches 'Star Wars'-like Attack Crippling Immune Defenses.

Business Editors

PHILADELPHIA--(BUSINESS WIRE)--Nov. 20, 2001

Hemispherx Biopharma, Inc. (AMEX: HEB) announced today a new research program to potentially address the growing threat of global biohazard secondary to smallpox. The program is unique in that it is directed towards rebuilding the "first lines of defense" which are crushed in the very early stages of smallpox infection.

Preeminent researchers in both the U.S. and European Union (EU) will be engaged in this research. Most smallpox research was actually discontinued in the late 1970s with no safe and effective therapies being identified. Vaccination was also phased out in the 1970s, leaving an estimated 100 million Americans or more without significant immunity against the smallpox virus. Similar estimates exist for the at risk population in the EU. Vaccines, currently limited in supply, present serious side effects in some, especially those with immune defects.

Smallpox Lethality

New molecular insight into smallpox lethality (with an estimated 20-30% death rate) now suggests that the virus destroys the human host only after crippling the first lines of immunologic defenses which largely consist of the interferons (IFNs), a family of several dozen immune promoting/antiviral proteins, normally produced throughout the body. The smallpox virus creates a wave of decoy molecules which attract, bind to, and inactivate all of the different interferons - thereby leaving the bodies' immune cells defenseless and unprotected against further viral onslaught (summarized in "Viral Subversion of the Immune System", p861, Annu. Rev. Immunol. 2000). Death can occur in a matter of days as the body becomes progressively vulnerable as its' immune defenses are stripped away by IFNs (alpha, beta, gamma) attacking useless decoy targets served up by the virus and thereby depleting vital immune reserves.

New Technology Platform Rearms Immune System and Ignores Smallpox Decoy Targets

The present CEO/Chief Scientific Officer at Hemispherx, Dr. William A. Carter, was one of the earliest clinical researchers in IFN while at the Johns Hopkins University School of Medicine in the late 1960s and early 1970s. Dr. Carter was also the first researcher to recognize and publish a major work in a scientific journal (Science, 1974) on the subject "Interferon Blockades" and "Molecular Foot-races" which decide the fate of human cells. To overcome these virus specific strategies of disarming the bodies natural defense systems, he co-invented a wholly new therapeutic approach called dsRNA (nucleic acid or NA) to circumvent viral blockades and thereby re-induce broad-based cell immunity.

Hemispherx dsRNA Platform Technology

DsRNA technology avoids the IFN pitfalls by (1) utilizing immune cell receptors which are unique (Nature, October 2001, page 732) and (2) activating immune systems (also called "antiviral cascades") within the cells themselves, thereby avoiding the vast army of decoy targets created by the smallpox virus. The decoy targets float outside the cells, alongside the defunct IFN molecules, in the bodies' bloodstream and lymph circulatory systems.

The new research will involve both low molecular weight RNAs, which are orally bio-available, and large RNAs which are administered parenterally. Tier 1 research will be conducted in cell culture; Tier 2, in animals; Tier 3, in man utilizing clinical protocols filed in anticipation of possible sentinel cases or outbreaks in the U.S. or EU.

Strategy and Motivation for Launching New Program

Dr. Carter said that the programs were being launched at this time for three reasons: (1) The overarching national and international mandate to contain any smallpox outbreaks secondary to bioterrorism; (2) The uniquely positioned technology of Hemispherx with 25 years experience in NA manufacture and mechanisms of action; (3) The potential to add a new Fast Track New Drug Development arm to Hemispherx's portfolio of drug candidates.

Separate Staffing for Biowarfare Initiative

The Company said that the new program, termed the "911 Project", would be staffed independently of its existing professional team fully committed to ongoing clinical programs in Phase II and Phase III research in HIV and Chronic Fatigue Syndrome (CFS), respectively. Outsourcing of certain aspects of the experimental work to expert collaborators in the academic sector is already in place and support by governmental agencies would be expected in the near future. Prominent researchers in Belgium and former members of U.S. Military Advisory Committee on Antivirals and the National Institutes of Health Virology Study Section Committees are already drafting clinical protocols and performing collaborative laboratory experiments.

Information contained in this news release other than historical information, including the referenced Smallpox drug testing, should all be considered forward-looking and are subject to various risk factors and uncertainties. For instance, the strategies and operations of Hemispherx involve risks of competition, changing market conditions, changes in laws and regulations affecting these industries and numerous other factors discussed in this release and in the Company's filings with the Securities and Exchange Commission. Accordingly, actual results may differ materially from those in any forward looking statements. Additionally, all the referenced investigational drugs and associated technologies of the company are experimental in nature and as such are not designated safe and effective by a regulatory authority for general use and are legally available only through clinical trials with the referenced disorders. The forward-looking statements represent the Company's judgement as of the date of this release. The Company disclaims, however, any intent or obligation to update these forward-looking statements.