Atugen Achieves Milestones on Schering Target Validation Agreement

Berlin, 9 May 2005: Atugen AG announced today that it has achieved nine of its milestones under its target validation research contract with Schering AG (FSE: SCH, NYSE: SHR) and its US-based subsidiary, Berlex Biosciences. The milestone payments have been made for nine cancer drug targets which have been further investigated in studies by Schering after Atugen successfully validated these targets out of several dozen identified by Schering since 2002. Over the period of the research agreement Atugen has received milestone payments, annual license fees and research funding. Financial details were not disclosed.

Under the agreement, Atugen has employed its proprietary gene silencing technologies for rational in vitro target validation in multiple cell lines. Atugen’s unique approach combines its siRNA molecules and its third generation antisense technology (GeneBloc®) in parallel. This approach, called CrossValidation, is designed to exclude artifacts and nonspecific effects that could arise if either technology were applied alone. The GeneBloc® technology is, in contrast to other antisense technologies, extremely potent and devoid of toxicity. Furthermore, Atugen’s set of proprietary liposomal transfection reagents is custom-tailored to individual cell lines and minimizes toxicity while obtaining high transfection rates. Atugen also validated gene function and disease association in a range of pharmacological assays.

“These milestones are a pleasing endorsement of Atugen’s technology. But even more importantly they signal the significant part RNA interference can play in the search for new ways to fight major diseases like cancer,” said Klaus Giese, Atugen’s CSO and VP of Technology.

-ENDS-

Contact:

Northbank Communications

Katja Stout/Ashley Lilly

Tel: +44 (0) 20 7886 8150

Email: a.lilly@northbankcommunications.com

Atugen AG

Dr Andre Lochter, Director Business Development,

Tel: +49 30 9489 2804

Email: lochter@atugen.com

Notes to Editors:

Atugen AG, www.atugen.com <http://www.atugen.com/> , the RNAi Therapeutics Company, is a biopharmaceutical company with core competence in functional gene silencing. The company has developed stabilized, proprietary siRNA molecules (atuRNAi*) for use in animals and humans. Several proof-of-concept studies in animals have shown that atuRNAi* can be used to successfully treat cancer and other diseases, either alone or in combination with custom-tailored delivery vehicles. The strategic focus of the Company is now to take its RNAi technology into the clinic in advanced cancer indications. In other fields such as ophthalmology, Atugen has established partnerships that will accelerate clinical development of atuRNAi*. A lead compound from the Company’s partnered ophthalmology program is expected to enter the clinic in the first half of 2006. Atugen expects to start a Phase I/IIa study for its in house cancer program in the second half of 2006. The Company is looking for additional strategic alliances to develop RNAi therapeutics.

Publisher Contact Information:

atugen AG
+49 30 9489 2804
lochter@atugen.com

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