Chiron Corporation and the Global Alliance for TB Drug Development Agree on License of  PA-824 Compound for New Tuberculosis Therapeutics

-- Groundbreaking Agreement for New Tuberculosis Treatment --

EMERYVILLE, CA and NEW YORK, NY, February 1, 2002.  Chiron Corporation and the Global Alliance for TB Drug Development, announced today that they have agreed to license terms for the development of PA-824 as a therapeutic agent for the treatment of tuberculosis (TB).  Under the terms of the agreement, the Global Alliance for TB Drug Development, a public-private partnership created in 2000, obtains the exclusive worldwide license of PA-824 and related compounds for the development of a new drug to treat tuberculosis.

Dr. Maria C. Freire, CEO of the Global Alliance for TB Drug Development, said, "This agreement confirms that our vision can work and our business strategy is on track.  PA-824 is the first of several promising new drug candidates we have under negotiation for further development, to ensure that innovative technologies reach patients who need new medicines. Together with Chiron, we are proving it's possible to combine the fruits of an aggressive biotech strategy with a social mission."

"Through this unique partnership, we can tackle a critical medical need," said Craig Wheeler, president of Chiron's BioPharmaceuticals division. "At Chiron we are committed to making a difference in people's lives, and we are pleased to participate in the development of a potential new treatment for TB.  As world leaders gather to review strategies in combating infectious diseases today, we are proud to be making a commitment to develop new drugs that will fight TB and dramatically improve global public health tomorrow."

The announcement coincides with the release of the World Health Organization (WHO)'s report "Scaling Up the Response to Infectious Diseases," which highlights new ways of doing business to help control TB, AIDS and malaria, including novel approaches to the development of new therapeutics. 

"This agreement is an excellent case study that perfectly embodies our report," said Dr. Gro Brundtland, Director-General of the WHO. "Chiron and the TB Alliance are illustrating in real terms how industry can be a full partner in developing new therapeutics to fight diseases of poverty, thereby unlocking critical economic opportunities for everyone."

Historic Agreement:

The agreement is the first such arrangement between a private company and a non-profit for a new compound that could treat tuberculosis, which infects one third of the world's population, but is still treated with drugs discovered up to 50 years ago.

The parties signed a Memorandum of Understanding (MOU) that outlines license terms for PA-824 and a family of nitroimidazoles derivatives.  The TB Alliance will undertake further development of PA-824, which is currently in preclinical development, and/or its analogs licensed from Chiron.  In addition, provisions have been made for possible further collaboration with Chiron Corporation at later stages of development, including a grant-back option to Chiron for manufacture and commercialization of products in developed markets.  The parties have agreed that no royalties will be due under this agreement for drugs marketed in less developed economies, including impoverished countries with a high burden of tuberculosis.

PA-824 is a novel lead compound related to nitroimidazoles, a family of compounds used to treat a range of infections.  PA-824 has already demonstrated in vitro activity against both drug-sensitive and multidrug-resistant strains of TB.  Early research into PA-824 has highlighted important properties that may have the potential to permit significant reduction in the duration of TB treatment from its present course of 6 to 9 months.  There was great excitement among the TB and scientific communities when the first scientific report on PA-824 came out in June 2000.

TB is a highly contagious, airborne disease that attacks the respiratory system and is presently treated with a four-drug combination that imposes a lengthy 6-9 month treatment course.  TB kills 2 million people each year, and now is the number one cause of death of people with HIV infection.  Moreover, among the more than 8 million new TB cases identified each year, multi-drug-resistant strains are on the rise.  New treatments are necessary to combat the tuberculosis epidemic, because no new class of drugs has been developed in 30 years.  Treatment regimens imposed by currently approved drugs are long and cumbersome and fail to treat resistant strains.

"The Alliance is proving that real hope for new treatments of tuberculosis exists," said Carlos Morel, Chairman of the Board of the TB Alliance and Director of WHO's Special Program for Research and Training in Tropical Diseases (TDR). "When we lose someone to TB every fifteen seconds, the urgency to find novel treatments to fight tuberculosis can not be overstated.  With access to Chiron's PA-824 program, we can envision the possibility of developing new drugs to make serious inroads in this deadly epidemic."

About the Global Alliance for TB Drug Development:

The Global Alliance for TB Drug Development (TB Alliance) is a not-for-profit, public-private partnership seeking to accelerate the discovery and/or development of affordable new anti-TB drugs that will shorten treatment, be effective against multi-drug resistant strains, and improve treatment of latent infection.  The TB Alliance functions as a lean, virtual R&D organization that outsources R&D projects to public labs or industry.  It builds a portfolio of promising drug candidates, manages their development through cooperative deals with public and private partners, providing staged funding and expert scientific and management guidance.  For more information about the TB Alliance, visit its web site at www.tballiance.org.

About Chiron Corporation:

Chiron Corporation, headquartered in Emeryville, California, is a global pharmaceutical company that leverages a diverse business model to develop and commercialize high-value products that make a difference in people's lives.  The company has a strategic focus on cancer and infectious disease. Chiron applies its advanced understanding of the biology of cancer and infectious disease to develop products from its platforms in proteins, small molecules and vaccines.  The company commercializes its products through three business units: biopharmaceuticals, vaccines and blood testing. For more information about Chiron, visit the company's website at www.chiron.com.