Phytera Awarded SBIR Grant to Develop New Tools for

Antibacterial Drug Discovery Worcester, Mass. (PROTEXT) - Phytera, Inc. has received aPhase I Small Business Innovation Research (SBIR) grant from theNational Institute of Allergy and Infectious Diseases to developnew tools for antibacterial drug discovery. The grant willsupport the design and development of mutant strains of bacteriathat have been genetically modified to delete multiple drugresistance (MDR) pumps. Such MDR pump "knockouts" have been shownto display increased sensitivity to a variety of antimicrobialagents and offer advantages in screening for new antibiotics. "This SBIR grant is an important endorsement of our program todevelop and apply our innovative MDR pump knockouts to broadlyscreen pharmaceutical candidates," said Malcolm Morville, Ph.D.,President and Chief Executive Officer of Phytera. "Phytera isactively applying its MDR pump knockout technology in the anti-fungal area in its collaboration with Eli Lilly & Co. for thediscovery of novel anti-fungal agents. This SBIR grant supportsthe expansion of our MDR knockout program in bacterial infectiousdisease applications, where we believe this approach will offersubstantial benefit in discovery." Dr. Morville noted that theMDR pump knockouts are part of Phytera's integrated CombinatorialDrug Discovery Program, which combines the Company's diverseplant and marine microbial cultures with its high-throughputscreening and combinatorial chemistry systems for theidentification and optimization of new candidate drugs. MDR pumps, which defend many pathogens from antimicrobialdrugs by expelling the drug from the cell, are responsible for asignificant percentage of drug resistance in both bacteria andfungi. Because of the presence of MDR pumps in strains ofpathogens historically used as screening tools, whole classes ofpotential antimicrobial chemical compounds may have beenoverlooked. To date, Phytera has generated a proprietary libraryof fungal and bacterial mutants that have one or more of theirMDR pumps selectively inactivated (or "knocked out"). Included inthis library are knockouts of several major bacterial and fungalpathogens, including Staphylococcus aureus, Escherichia coli andCandida albicans. Phytera's efforts have demonstrated that screens using theseMDR knockout strains are capable of detecting the antimicrobialactivity of chemical compounds that remains undetected in screensusing unaltered pathogen strains with normal MDR pumps. Testingof Phytera's chemical diversity libraries from plant and marinemicrobial cultures in its MDR pump knockout screens promises touncover novel antimicrobial drugs free from current resistanceproblems. The emergence of resistance to antibacterial drugs representsa growing worldwide clinical problem that is rapidly escalatingtowards a major medical crisis. Gram-positive pathogens areparticularly problematic because strains have emerged that areresistant to several different classes of antibiotics. The recentdetection of a strain of the common human pathogen,Staphylococcus aureus, that is resistant to vancomycin, apowerful antibiotic regarded by many as the last line ofantibacterial defense, strongly reinforces the fact that drugresistance has become a critical clinical issue. In order toaddress this, there is a clear need to discover new classes ofpotent antibacterial drugs that are not susceptible to theresistance mechanisms seen with current agents. Phytera, Inc. is a biotechnology company headquartered inWorcester, Massachusetts, with wholly owned subsidiaries inSheffield, U.K., Copenhagen, Denmark and Tastrup, Denmark. TheCompany is applying novel technology platforms to theidentification and optimization of new lead structures and drugcandidates for pharmaceutical application. Phytera has allied itsplant and marine microbial culture technologies with innovativehigh-throughput screening and combinatorial chemistrycapabilities to create an integrated, proprietary CombinatorialDrug Discovery Program. Infectious disease products from theprogram are currently in preclinical development. Additionally,Phytera seeks to leverage its technologies via externalcollaborations and to date has signed agreements with NycomedAmersham plc, Tsumura & Co., Galileo Laboratories, Inc.,NeuroSearch A/S, Chiron Corporation and Eli Lilly & Co. otsOriginal Text Service: Phytera, Inc. Internet:http://www.newsaktuell.de Contact: Dr. Malcolm Morville,President and CEO of Phytera, Inc. (USA) 508-792-6800, orRobert Gottlieb of Feinstein Kean Partners Inc. (USA) 617-577-8110

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