MethylGene Discloses Preliminary MG98 Clinical and Preclinical Data at ASCO-Interim Results Reported for Ongoing Clinical Trials.

MONTREAL -- MethylGene Inc. (TSX:MYG), a biopharmaceutical company focused on cancer and infectious disease, today announced preliminary clinical and preclinical data for its oncology product candidate MG98, a DNA methyltransferase mRNA inhibitor. Results for three studies were disclosed: MG98/Interferon Phase II Step 1 renal cell carcinoma trial, MG98 Phase I solid tumour trial, and preclinical results which demonstrated that the reduction of DNMT1 by MG98 renders interferon more effective.The updated preliminary results were disclosed in conjunction with two poster sessions at the 2005 American Society of Clinical Oncology's (ASCO) annual meeting in Orlando, Florida being held from May 13-17, 2005.

Preliminary MG98/Interferon Phase II Step 1 Results

Rationale: Interferon alpha is a well-established drug for the treatment of renal cell cancer; however, success is limited due to interferon resistance and relative tolerability.Research with the Cleveland Clinic has shown that interferon resistance in certain refractory renal cell cancerlines is correlated with the methylation of certain interferon responsive genes and that pre-treatment of refractory renal cell lines with MG98 renders the cells more susceptible to interferon treatment.These observations documented the silencing of multiple tumour suppressor genes in renal cell cancer, and combined with the Company's previous Phase I and Phase II clinical results in patients with metastatic renal cell cancer, further support the ongoing randomized, two-step Phase II combination trial of MG98 with interferon alpha.

Method: In this parallel first step two-arm trial, MG98 was administered in combination with interferon alpha subcutaneously three times per week in combination with MG98 given either by: i) continuous infusion (IV) for 7 days followed by one week of rest and then repeated to constitute one cycle or for ii) 2-hours (IV) twice weekly for three weeks followed by one week of rest (intermittent infusion) to constitute one cycle.

Results: The Company reports on the first six enrolled patients: three under each regimen, with enrollment in each schedule ongoing. One patient on the continuous infusion schedule experienced a confirmed partial response by RECIST criteria. Under the continuous infusion schedule, the dose of MG98 when combined with interferon (12 million units, three times per week) had a DLT of 125mg/m2/day. This schedule will further be expanded using a dose of MG98 of 100/mg/m2/day. Adverse effects included reversible thrombocytopenia and neutropenia, both of which are known side effects of interferon therapy. Additional effects included reversible transaminitis, nausea and fatigue all equal to or less than Grade 3 consistent with previous reports for oligonucleotides. Of note, as described below, doses of 100-125mg/m2/day as a monotherapy were found to provide the maximal pharmacodynamic effect in the Company's ongoing Phase I study. For the intermittent schedule, dosage is currently at 160mg/m2/day of MG98 when combined with interferon (12 million units, three times per week) and the optimum dose has not yet been attained. Based on the results generated in Step 1 of this trial, the Company expects to select a recommended regimen of MG98 plus interferon by year end or in the first quarter of 2006. The Company anticipates progressing to the second step of the trial in which an additional 200 evaluable patients will be enrolled and randomized to the optimized dosing regimen of MG98 plus interferon versus interferon alone. Additional clinical sites will be opened in both North America and Europe to support Step 2 of this trial.

Interim MG98 Phase I Results in Solid Tumours

Rationale: DNA methylation has been postulated to play an important role in tumour progression and therefore the reduction of DNA methylation by the inhibition of DNA methyltransferase 1 (DNMT1) may result in anticancer activity.

Methods: In this trial, patients with advanced solid tumours received MG98 as a continuous infusion for 7 days followed by 7 days of rest, which represents one cycle of treatment.Dose levels were 100, 125, 160, 200 and 250mg/m2/day. The primary endpoint of this trial was safety and tolerability.

Results: The poster "A Phase I and pharmacodynamic study of a 7-day infusion schedule of the DNMT1 antisense compound MG98" presented at ASCO, summarized MG98 data from this ongoing multi-center Phase I monotherapy dose-escalating clinical trial. The data demonstrated that MG98 possessed antitumour activity and provided sustained reduction in DNA methyltransferase 1 (DNMT1) expression.Pharmacokinetic analyses for MG98, its metabolites and determination of DNMT1 expression in peripheral blood lymphocytes were performed during the first two cycles and demonstrated a half-life of 1.5 hours for MG98. To date, 34 patients are enrolled and, of these patients, one patient with lower esophageal carcinoma experienced a minor response due to tumour shrinkage and two other patients experienced stabilization of their disease (a gastrointestinal stromal tumour (GIST) and cholangiocarcinoma). Of interest, the GIST patient 8 months post the last administration of MG98 remains well and has not received further treatment. Dose limiting toxicities (DLT) were reversible transaminitis and reversible thrombocytopenia at 250mg/m2/day, all less than or equal to Grade 3.Other adverse effects included fatigue, headaches, nausea, anorexia and constipation, all less than or equal to Grade 2. The MTD for this schedule was identified as 200mg/m2/day.Three additional patients are required to complete enrolment in this trial. Also discussed in this poster are pharmacodynamic data from 13 patients demonstrating that DNMT1 mRNA was consistently and reproducibly suppressed. The maximum suppression of DNMT1 mRNA occurred between 100 and 125 mg/m2/day and ranged from 18% to 85% suppression compared to baseline. The study schedule used in this Phase I trial was used as one of the schedules for the first step of the ongoing randomized two-step Phase II combination study with interferon in metastatic renal cancer, described above, which began in the fourth quarter of2004.

"MG98 appears to be generally well tolerated when combined with interferon and any side effects noted have been reversible. Obtaining one minor response and two patients with stable disease in our nearly complete Phase I monotherapy studies is encouraging and supports the use of this continuous infusion schedule in the first step of our Phase II trial," noted Mr. Donald F. Corcoran, President and CEO of MethylGene Inc."We are further encouraged to have obtained a confirmed partial response in a patient in Step 1 of this Phase II trial using this schedule and are further enrolling patients to determine the optimal schedule and dose of MG98 combined with interferon alpha. We expect to have 6-8 international clinical sites on board, as expected, by the end of the second quarter of 2005."

Preclinical data demonstrate that the reduction of DNMT1 with MG98 renders interferon more effective

A second poster, presented at ASCO, entitled "Epigenetic silencing of Ras association domain family member 1A (RASSF1A) confers resistance to apoptosis induction by interferons" described how the reduction of DNA methylation by pretreating cells with MG98 enhanced the effect of interferon alpha in renal cancer cell lines. MethylGene and collaborators at the Cleveland Clinic presented data that demonstrated that MethylGene's DNA methyltransferase 1 inhibitor, MG98, both sensitized and overcame resistance of human renal cancer cells to the effects of interferon-a2beta.This sensitization was shown to be achieved by the demethylation and reactivation of the tumour suppressor gene RASSF1A that was silenced by methylation in up to 90% of renal cancers.These results further support the ongoing Phase II combination trial with MG98 and interferon alpha in human renal cell cancer.

About MethylGene

MethylGene is a publicly traded biopharmaceutical company focused on the discovery, development and commercialization of novel therapeutics in cancer and infectious disease.Two cancer product candidates, MG98, partnered with MGI PHARMA, Inc. for North America and MGCD0103, partnered with Taiho Pharmaceutical Co., Ltd. for certain Asian countries, are currently in clinical trials.

MG98 has entered a randomized two-step Phase II combination trial with interferon alpha in metastatic renal cell cancer.MGCD0103 is currently in Phase I dose-escalation monotherapy trials against solid tumours and hematological malignancies.In collaboration with Merck, MethylGene is developing small molecule beta-lactamase inhibitors to overcome antibiotic resistance.MethylGene has a portfolio of preclinical programs for its multi-targeted kinase and histone deacetylase (HDAC) inhibitors for both oncology and non-oncology indications, and is exploiting its core HDAC expertise for the treatment of neurodegenerative diseases with EnVivo Pharmaceuticals, Inc.Please visit MethylGene's website at www.methylgene.com.

Except for historical information, this news release may contain forward-looking statements, which reflect the Company's current expectation regarding future events.These forward-looking statements involve risk and uncertainties (which can be found in the Company's Annual Information Form for the year ended December 31, 2004 and can be found on www.sedar.com) which may cause but are not limited to, changing market conditions, the successful and timely completion of clinical studies, the establishment of corporate alliances, the impact of competitive products and pricing, new product development, uncertainties related to the regulatory approval process and other risks detailed from time to time in the Company's ongoing quarterly and annual reporting.

METHYLGENE INC. (TSX:MYG)