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NEREUS ANNOUNCES GRANT OF PATENT FOR ANTI-INFLAMMATORY DRUG CANDIDATES

SAN DIEGO - May 07, 2002 - Nereus Pharmaceuticals Inc., a pioneer in drug discovery and development from marine microbial sources, today announced that it was awarded U.S. Patent No. 6,365,768 for a new class of interleukin-1 (IL-1) and tumor necrosis factor-alpha (TNF-àlpha) modulators. The patent, entitled "Interleukin-1 and Tumor Necrosis Factors-alpha Modulators, Syntheses of Said Modulators and Methods of Using Said Modulators," covers these compounds, their synthesis and their use in the treatment of a variety of conditions such as inflammation, transplant rejection and cancer. This patent was issued to Nereus and the University of California, from whom Nereus holds an exclusive worldwide license under the patent.

TNF-àlpha and IL-1 are involved in a cascade of biochemical changes that trigger the reactions of the immune system. The production and elimination of TNF-àlpha and IL-1 must be carefully regulated. Overproduction leads to chronic inflammation, while underproduction diminishes the immune response to foreign microorganisms. The compounds of this newly issued patent have the ability to influence this fine balance.

The therapeutic efficiency of TNF-àlpha inhibitors in inflammatory/immune system pathology is well known, with compounds such as Enbrel and Remicade marketed for rheumatoid arthritis and inflammatory bowel disease, respectively. These drugs are generally difficult to manufacture, must be administered by injection and often pose unwanted side effects. Because Nereus' newly patented compound is a small molecule and is an orally active anti-inflammatory drug candidate, it potentially offers significant advantages over currently available drugs.

"Our selective TNF-àlpha/IL-1 synthesis inhibitors are progressing through pre-clinical trials and yielding exciting results, showing their effectiveness in a murine model of rheumatoid arthritis," said Kobi Sethna, president and CEO of Nereus. "With our analog program, we have developed second generation versions of these promising anti-inflammatory drug candidates."

About Nereus Pharmaceuticals, Inc.
Nereus Pharmaceuticals is an innovative drug discovery and development company pursuing untapped sources of chemical diversity. With unmatched expertise in marine microbiology and structural elucidation, Nereus is using its integrated platform technologies to identify novel biologically active compounds. The company believes that its marine microbes will be the next great source of drug discovery for the pharmaceutical industry. Nereus aims to develop and optimize drug candidates to treat cancer, infectious diseases, and inflammation. The company is privately held and based in San Diego, California. For more information, visit www.nereuspharm.com.

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