OXO CHEMIE AG INITIATES MACROKINE PHASE 2 CLINICAL TRIALS.

OXO Chemie AG, South San Francisco, has initiated Phase 2 clinical trials of their macrophage-regulating drug, MACROKINE(R) (WF10), in patients with chronic active hepatitis C virus (HCV) disease. To date, 22 of the planned 80 patients have been enrolled in the studies being conducted in Germany and Hong Kong prior to the initiation of international multicenter studies. MACROKINE(R) (WF10) is a proprietary chlorite-containing drug currently in Phase 3 studies of patients with advanced HIV disease in the U.S.

The objective of the HCV studies is to determine the effect of MACROKINE(R) (WF10) on liver enzymes, necroinflammatory changes assessed by histologic activity index (HAI) scores, and expression of inflammatory genes in chronic active hepatitis C adult patients who are unresponsive or intolerant to therapy with interferon-alpha (IFN-alpha) alone or in combination with ribavirin. In pilot studies, MACROKINE(R) (WF10) has downregulated elevated levels of pro-inflammatory genes (i.e., TNF-alpha, IL-1 beta, MIP-1 alpha) in a dose-dependent fashion, which was associated with clinical benefit.

MACROKINE(R) (WF10) causes direct effects on the body's macrophages, immune cells that both directly fight bacterial and fungal infections as well as direct lymphocytes, such as T cells, to appropriately fight viral diseases. Earlier preclinical and clinical studies of MACROKINE(R) (WF10) in patients with HIV disease suggested that MACROKINE(R) (WF10) could be helpful in patients with other forms of virus-driven immune abnormalities, such as those seen in patients with HCV disease.

The hepatitis C virus causes chronic liver disease that over time in a large percentage of infected individuals leads to cirrhosis and liver failure or liver cancer. Estimates at this time suggest that more than 10 million people in the U.S., Europe, and Japan are infected with HCV. Current therapy is effective in only a small proportion and is primarily directed at inhibition of HCV replication. HCV disease is associated with immune-mediated destruction of the liver.

OXO Chemie AG, in collaboration with Dr. Stefan Meuer, professor of Immunology and director of the Institute of Immunology at the University of Heidelberg, Germany and Dr. Michael McGrath, Professor of Laboratory Medicine at UCSF and chairman of OXO Chemie's scientific advisory board, has developed a quantitative molecular technique that may allow monitoring of drug-associated immune system changes in peripheral blood. This technique employs polymerase chain reaction (PCR) quantitation of immune activation/disease- associated genes from very small samples of blood obtained from patients.

The HCV Phase 2 trials will be the first to employ this new technology for evaluation of gene expression response in conjunction with clinical response to MACROKINE(R) (WF10). Dr. Meuer stated, "Through real-time evaluation of gene expression changes in response to MACROKINE(R) (WF10), we hope to develop a rationale for use of immune-active drugs in patients with diseases of chronic immunologic activation, such as HCV disease."

Dr. McGrath added, "The results of the MACROKINE(R) (WF10) trial in HCV disease are predicted by the balanced macrophage activation hypothesis. Interference with a cell function that is chronically driving a process leading to a pathogenic outcome should result in resolution of the problem. In the case of HCV disease, macrophage activation drives the chronic T cell activation that over time leads to destruction of the liver. The consistent effect of MACROKINE(R) (WF10) in vitro and in earlier in vivo studies suggests that MACROKINE(R) (WF10) blocks (downregulates) the macrophage-associated T cell activation stimulus, and this should lead to a resolution in part to disease of inappropriate immune activation, such as HCV disease."

OXO Chemie, one of the founding companies of the Heidelberg Technology Park, has offices in South San Francisco (California, USA), Fribourg (Switzerland) and Bangkok (Thailand). The company maintains production facilities in Wanzleben, Germany. OXO Chemie is a pioneer developer of chlorite-based drugs.

The company's lead drug, WF10, is approved for use in Thailand under the name IMMUNOKINE(TM), in patients with postradiation chronic inflammatory diseases including cystitis, proctitis and mucositis. A Phase 3 clinical trial of WF10 is underway in the US and Canada in patients with advanced HIV disease; patient enrollment is nearing completion. The company also has ongoing trials in cancer and hepatitis C.

Additional information on OXO Chemie can be found on the World Wide Web at www.oxochemie.com. WARNING: The information contained herein this press release contains forward-looking statements. The company's activities and actual results may differ significantly from possible results. Based on current expectations, the company assumes no obligation to update this information.

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