Suntory Ltd. and ICOS Corp. announce the formation of a joint venture company.

SEATTLE--(BUSINESS WIRE)--Jan. 8, 1997--Suntory Ltd. of Japan and ICOS Corp. (NASDAQ:ICOS) have announced that they have entered into an agreement to form a new joint venture company called Suncos Corp.

The joint venture will develop and commercialize a therapeutic agent, rPAF-AH (recombinant platelet-activating factor acetylhydrolase) which is one of ICOS' current products in development. PAF-AH is a naturally occurring human enzyme that degrades platelet-activating factor (PAF), a potent pro-inflammatory mediator.

The joint venture company will develop rPAF-AH as an agent for the treatment of diseases accompanied by increased PAF activity.

In forming Suncos, ICOS will grant a license for the rPAF-AH technology to Suncos and Suntory will make an initial capital contribution of $30 million. In addition, both parties have committed to jointly fund all development activities and expenses of Suncos.

Suncos will be managed jointly by Suntory and ICOS. ICOS will market rPAF-AH in the U.S. and Suntory will have rights in Japan. Each company will pay royalties to Suncos for those Territorial marketing rights. Suncos will retain all rights to market the product in territories outside the U.S. and Japan.

Suntory is aggressively expanding its global strategy in biopharmaceuticals. In this joint project, Dr. Terumi Nakajima, senior managing director, executive manager of Pharmaceutical Division of Suntory Ltd., stated, "Suntory appreciates the potential of rPAF-AH as a worldwide product based on ICOS' technology, the patent position and their outstanding scientists. Suntory considers this project a strong fit into our strategy and have made the decision to create a new joint company."

The relationship is the result of a strong interest by both parties in exploiting the untapped therapeutic potential of the naturally occurring PAF antagonist, PAF-AH. According to George B. Rathmann, chairman and CEO of ICOS, "Suntory's established strengths in Japan and an expanding strategy in pharmaceuticals, particularly in human proteins, makes this a powerful joint program. In partnership we can explore more disease indications and reach more markets."

In 1996, ICOS established safety in a Phase 1 clinical trial of rPAF-AH with healthy volunteers and plans to initiate several Phase 2 clinical trials in 1997. The initial clinical focus is in acute conditions such as ARDS (acute respiratory distress syndrome), acute pancreatitis, and asthma.

Suntory Ltd. is a leader in the whiskey, wine and food industries in Japan. The Pharmaceutical Division, with headquarters in Tokyo, began operations in 1979 to develop and commercialize innovative biopharmaceuticals.

Currently, Suntory markets several products such as an antiarrythmic agent called SUNRYTHM(TM); the recombinant form of interferon gamma-1a called BIOGAMMA(TM); an atypical hyperphenylalaninemia agent called BIOPTEN(TM) and the first pharmaceutical preparation in the world of human atrial natriuetic peptide called HANP(TM).

The product candidate FAROM(TM) is expected to launch in early 1997 as the first oral beta-lactam antibiotics with penem-type. The Lanoteplase, a novel tissue plasminogen activator is in the pre-NDA stage. Suntory is committed to work with the world's leading corporations, research institutes and universities in joint research and development.

ICOS is discovering and developing new pharmaceuticals by seeking points of intervention in the inflammatory process that may lead to more specific and efficacious drugs. The company's research and drug development programs involve both acute and chronic conditions such as ARDS, acute pancreatitis, asthma, hemorrhagic shock, male erectile disorder, multiple sclerosis, myocardial infarction, and psoriasis.

For additional information on ICOS including previous press releases, see www.shareholdernews.com/icos on the Internet.

CONTACT: ICOS Corp.

Lacy Fitzpatrick, 206/485-1900

or

Suntory Ltd., Pharmaceutical Division

George Nakayama, 03 5276 5401