Galenea and Otsuka Announce Second Extension to Schizophrenia Research Collaboration

CAMBRIDGE, MA, and TOKYO, JAPAN (December 1 2009) -- Galenea Corp. and Otsuka Pharmaceutical Co., Ltd. announced today the further extension of their research and development collaboration through 2011. This latest extension increases the collaboration term to seven years and brings the total committed funding to approximately $90 million. The companies have been working together since January 2005 with the goal of discovering and developing first-in-class therapies for schizophrenia and other central nervous system (CNS) diseases based on the calcineurin pathway. The agreement was previously extended for one year in October 2008.

Mark Benjamin, D.Sc., Chief Executive Officer of Galenea, said “We are thrilled with the continued endorsement of Otsuka and delighted to receive this second extension to our collaboration. Our scientists continue to make progress and, with this additional support from Otsuka, we expect to deliver breakthrough therapies for schizophrenia.”

“We are very enthusiastic about extending our collaboration with Galenea. We have seen substantial progress toward our goal of identifying clinical development candidates with new mechanisms of action for the treatment of schizophrenia.” commented Taro Iwamoto, Ph.D., President and Representative Director of Otsuka Pharmaceutical Co., Ltd. “Through this collaboration with Galenea, we hope to enhance our research in the CNS field by taking advantage of their unconventional point of view and scientific approach. Our goal for this collaboration is the contribution of new therapies to patients in need. These innovative new therapies will add to our CNS portfolio which includes our antipsychotic agent and other compounds in earlier phases of development,” added Dr. Iwamoto.

Professor Susumu Tonegawa, Ph.D., 1987 Nobel Prize winner in Medicine, professor at the Massachusetts Institute of Technology (MIT), Director of the RIKEN Institute, and Galenea co-founder commented, “I am extremely pleased to see the continued commitment of Otsuka to Galenea and its innovative neuroscience research. It has been very rewarding to see this collaboration rapidly transform academic basic research into new approaches for treating schizophrenia.”

Galenea and Otsuka have made significant advances in several projects within the collaboration, including the progression of several molecules to the late lead optimization stage. Each project represents a potential therapeutic with a novel mechanism of action for treating many common symptoms in schizophrenia and related disorders. Galenea intends to deliver a clinical development candidate to Otsuka next year.

Otsuka will have exclusive worldwide rights to develop, manufacture and commercialize development candidates generated during the collaboration. Galenea will receive milestone and royalty payments, or alternatively may participate in profit-sharing.

About Otsuka Pharmaceutical

Founded in 1964, Otsuka Pharmaceutical Co., Ltd. is a global healthcare company with the corporate philosophy: “Otsuka-people creating new products for better health worldwide.” Otsuka researches, develops, manufactures and markets innovative and original products, with a focus on pharmaceutical products for the treatment of diseases and consumer products for the maintenance of everyday health. Otsuka is committed to being a corporation that creates global value, adhering to the high ethical standards required of a company involved in human health and life, maintaining a dynamic corporate culture, and working in harmony with local communities and the natural environment.

Otsuka Pharmaceutical Co., Ltd. is a wholly owned subsidiary of Otsuka Holdings Co., Ltd., the holding company for the Otsuka Group. The Otsuka Group comprises 153 companies and employs approximately 36,000 people in 23 countries and regions worldwide. Otsuka and its consolidated subsidiaries earned ¥955.9 billion (approx. US $9.7 billion*) in annual revenues in fiscal 2008.

^* Exchange rate as of March 31, 2009.

About Galenea

Galenea Corp. is a fully integrated neuroscience drug discovery company with a focus on psychiatric disorders. We have exclusively licensed intellectual property developed in the laboratories of Professor Susumu Tonegawa of MIT and Professor Maria Karayiorgou of Columbia University Medical Center (formerly of The Rockefeller University), which covers the calcineurin pathway and its role in schizophrenia pathogenesis. In January 2005, we established a multi-year R&D collaboration with Otsuka Pharmaceutical Co., Ltd. to generate breakthrough treatments for schizophrenia and related disorders based on the calcineurin pathway. This collaboration has been extended twice and total committed funding has nearly doubled. In addition to the calcineurin program, we have our own drug discovery program for selective 5HT2C agonists and other molecules targeting serotonin receptors. We also have a proprietary technology platform to find modulators of synaptic transmission, an essential process for neurological function. For more information about Galenea, please visit our website at www.galenea.com.