SangStat's CYCLOSPORINE Is Bioequivalent to Sandoz' Newest Cyclosporine Formulation, Neoral; Neoral Has Become The Most Commonly Used Formulation Of Cyclosporine In Transplantation.

MENLO PARK, Calif.--(BUSINESS WIRE)--January 6, 1997--SangStat, The Transplant Company (Nasdaq: SANG), announced today that its proprietary formulation of CYCLOSPORINE is bioequivalent to Sandoz' newest cyclosporine formulation, Neoral, in its pivotal bioequivalence trial. The Company filed an application for market clearance of its Neoral-bioequivalent CYCLOSPORINE with the U.S. Food and Drug Administration (FDA) on November 27, 1996. Neoral is the leading formulation of cyclosporine, an immunosuppressive drug used in human organ transplantation to prevent graft rejection. Worldwide sales of Sandoz' cyclosporines in 1995 are reported at $1.2 billion.

"We are pleased to make public to the transplant community, our shareholders and analysts that our CYCLOSPORINE is a Neoral-bioequivalent. Years ago, we recognized the potential for a high bioavailability formulation and dedicated our efforts to developing a Neoral-bioequivalent form using our proprietary technology," said Philippe Pouletty, M.D., Chairman and CEO, at the Hambrecht and Quist 15th Annual Healthcare Investors Conference in San Francisco today. He added, "We are glad to see that transplant physicians are rapidly gaining experience in switching patients from one cyclosporine formulation to another and that the market is fast changing to a higher bioavailability cyclosporine. Subject to approval of our CYCLOSPORINE, we intend to take advantage of this momentum in conversion."

In the United States and Europe there are more than 200,000 transplant recipients requiring daily immunosuppressive therapy for the rest of their lives, the majority of whom take cyclosporine. Sandimmune, the original formulation of cyclosporine, was introduced by Sandoz Ltd. in the U.S. in 1983. Neoral, an improved formulation of cyclosporine with increased bioavailability, was launched first in Europe in 1994 and then in the U.S. in September, 1995. Currently, the majority of all newly transplanted patients are started on Neoral, and more than 70% of European and 50% of the U.S. transplant recipients previously on Sandimmune have been converted to Neoral. This number continues to grow rapidly. Neoral and Sandimmune are marketed by Sandoz Ltd. (now Novartis) with 1995 worldwide sales reported at $1.2 billion.

Eli Lilly manufactured the exhibit batch used in SangStat's pivotal CYCLOSPORINE bioequivalence trials. Eli Lilly will manufacture the finished product of SangStat's CYCLOSPORINE for subsequent commercial sale and distribution worldwide by SangStat upon approval for marketing.

Under current FDA regulations and policy, a generic Neoral can be approved without the need to duplicate the safety and efficacy trials if the generic drug is shown to be bioequivalent to Neoral. SangStat recently completed pivotal bioequivalence trials demonstrating that SangStat's CYCLOSPORINE formulation is bioequivalent to Neoral. If the FDA accepts for filing and subsequently approves SangStat's CYCLOSPORINE based on bioequivalence to Neoral, SangStat's formulation will receive an "AB" rating in the FDA's list of approved drugs. This rating would signify that SangStat's CYCLOSPORINE is therapeutically equivalent to, and interchangeable with, Neoral.

"We filed an Abbreviated Antibiotic Drug Application (AADA), under Section 507 of the Federal Food, Drug and Cosmetic Act, for market clearance of our CYCLOSPORINE with the FDA in November, 1996," said Hana Berger Moran, Ph.D., V.P. Regulatory Affairs & Quality Assurance. "The path to approval of any therapeutic product may involve interim events such as the agency's refusal to file the application, minor or major deficiency letters or modification of the application. SangStat does not intend to disclose or comment on such events as long as we believe the Company can ultimately gain a market approval."

SangStat is a biopharmaceutical company applying a disease management approach to improve the outcome of organ transplantation. The Company has a total of 12 monitoring and therapeutic product and product candidates to address the pre-transplant, acute care and chronic phases of transplantation. Products in development include THYMOGLOBULIN (exclusive marketing and development rights from Pasteur Merieux Connaught "PMC" for the U.S. and Canada) to treat graft rejection, a Neoral-bioequivalent CYCLOSPORINE and AZATHIOPRINE for chronic immunosuppressive therapy and ALLOTRAP 2702 to promote graft acceptance following transplantation. Monitoring products include PRA-STAT and CROSS-STAT (both marketed in the U.S. and Europe) designed to improve donor/recipient compatibility. Other monitoring products in development are intended to guide post-transplant therapy; CELSIOR (exclusively licensed from PMC) is an organ preservation solution; and drug candidate XE-9 is in early development for xenotransplantation. XENOJECT platform technology also is in the discovery phase for replacing antibody therapy with small synthetic drugs. SangStat is located in Menlo Park, California, and operates The Transplant Pharmacy, a comprehensive pharmacotherapy management program, and wholly-owned subsidiaries, SangStat Atlantique S.A., SangStat's European base of operations in Nantes, France and SangStat Canada, Ltd. in Mississauga, Ontario, Canada and XenoStat, Inc., in Menlo Park, California.

This press release contains forward-looking statements that involve risks and uncertainties. Forward-looking statements reflect the Company's current views with respect to future events. Actual results may vary materially and adversely from those anticipated, believed, estimated, or otherwise indicated. Important factors common to the FDA drug review and approval process could cause actual results to differ materially with regard to the approvability of SangStat's CYCLOSPORINE. These factors include, without limitation, (1) that data obtained from clinical trials are subject to varying interpretations, and there can be no assurance that the FDA (or an FDA panel of experts) will agree with the Company's assessment of clinical trial results; (2) that there can be no assurance that the agency will not issue new guidelines, guidance documents, policies, or regulations or otherwise have new, different or previously unknown requirements that may materially affect the approvability of the product; and (3) that there can be no assurance of FDA acceptance for filing or of FDA approval of the AADA. Other factors that could cause actual results to differ materially include, without limitation, uncertainty related to the manufacturing of commercial quantities of CYCLOSPORINE on commercially favorable terms, market acceptance and potential litigation. For a discussion of factors that might result in different outcomes, see the section under the caption "Risk Factors" beginning on page 30 of the 1995 Annual Report to Stockholders.

CONTACT: SangStat

Maree Wall

V.P. Business Development & Investor Relations

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