News Release

Achillion Pharmaceuticals licenses Vion's antiviral agent for the treatment of Hepatitis B (HBV) and Human Immunodeficiency Virus-I (HIV)

Peer-Reviewed Publication

Vion Pharmaceuticals, Inc.

NEW HAVEN, CONN., February 8, 2000 -- VION PHARMACEUTICALS, INC. (NASDAQ NM: VION) AND ACHILLION PHARMACEUTICALS, INC. today announced that they have signed a licensing agreement for Vion's novel antiviral technology, nucleoside analog (beta)-L-Fd4C, for the potential treatment of HBV and HIV. Achillion, a privately held biopharmaceutical company located in New Haven, recently completed a Series B financing and is commencing operations to develop and commercialize innovative antiviral therapies. Under the terms of the license agreement, Achillion will fund the development of (beta)-L-Fd4C, which it intends to develop as one of its key product candidates. In return, Vion will receive potential milestone payments, downstream royalties and an equity position in Achillion.

Preclinical studies of (beta)-L-Fd4C, a nucleoside analog, indicated that it is a particularly potent inhibitor of the replication of HBV and demonstrated results superior to those of other competitive antiviral drugs. Further, (beta)-L-Fd4C may exert a longer-lasting therapeutic benefit and may require less frequent dosing than the current FDA-approved treatments. HBV is a causative agent of both acute and chronic forms of hepatitis that affects about 300 million people worldwide. HBV also predisposes its victims to the development of liver cancer.

In October 1996, Yale University was issued a patent for (beta)-L-Fd4C covering its composition of matter and method of use for treating HBV and HIV. Vion licensed exclusive worldwide rights from Yale University to develop this compound for the potential treatment of HBV and HIV, and now Achillion has licensed these rights for the same indications.

Alan Kessman, President and CEO of Vion, commented, "The licensing agreement with Achillion is an important part of our strategic partnering effort. It not only allows Achillion to advance the research and development activities of (beta)-L-Fd4C for the potential treatment of HBV and HIV, it allows Vion to focus on the development of our anticancer treatments. In addition, the licensing agreement affords us the opportunity to collaborate closely with the scientific staff at Achillion, who are committed to developing it as a key product technology, potentially providing Vion with an additional revenue and royalty stream in the future."

Dr. William G. Rice, President and CEO of Achillion stated, "Achillion has entered into partnership with Yale University in order to leverage antiviral discoveries from the laboratories of Dr. Yung-Chi "Tommy" Cheng. This strategy includes the licensing of (beta)-L-Fd4C from Vion, which Achillion will develop as an L-nucleoside analog for the treatment of HBV and HIV. We are delighted to have the opportunity to engage Vion in what we expect to be a mutually beneficial relationship, that enables Achillion to focus its efforts heavily in the antiviral arena."

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Achillion Pharmaceuticals, Inc. is a privately held biopharmaceutical company dedicated to the discovery and commercial development of innovative therapeutic agents, with a particular emphasis on antiviral drugs to treat diseases caused by hepatitis and herpes viruses, as well as HIV-1. Achillion's drug discovery engine embodies both a validated medicinal chemistry approach directed at classical molecular targets and a core breakthrough Zinc Finger Targeting (ZFT) technology. Dr. Rice co-founded Achillion with Yale University. Dr. Cheng of Yale, also a co-founder, will serve as the chairman of the Scientific Advisory Board. Achillion recently completed a round of venture financing from an investor syndicate that included Schroder Venture Life Sciences, Atlas Venture, Advent International, and Connecticut Innovations, Inc. The company will leverage its scientific, technological and financial resources to discover new antiinfective agents, to garner corporate partnering of unique capabilities, and to drive valuable products to the market.

Vion Pharmaceuticals, Inc. is a biopharmaceutical company engaged in the research, development and commercialization of cancer treatment technologies. Vion's product portfolio consists of TAPET®, a drug delivery platform, and three cancer therapeutics (Promycin®, Triapine® and Sulfonyl Hydrazine Prodrugs). TAPET has been shown in preclinical models to effectively deliver anticancer agents while having a minimal toxic effect on healthy normal tissues. TAPET uses genetically altered strains of Salmonella as a bacterial vector, or vehicle, for delivering cancer fighting drugs preferentially to solid tumors. Promycin, which attacks oxygen depleted cancer cells, is currently being evaluated with radiation in a multicenter Phase III clinical trial for the treatment of head and neck cancer. Triapine, which is designed to prevent the replication of tumor cells by blocking a critical step in the synthesis of DNA, is currently being evaluated for its safety in a Phase I clinical trial. Sulfonyl Hydrazine Prodrugs, compounds that are designed to be converted to unique potent, alkylating agents, are currently being evaluated in preclinical studies. For additional information on Vion and its research and product development programs, visit the company's Internet web site at http://www.vionpharm.com.

Statements included in this press release, which are not historical in nature, are forward-looking statements made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements regarding the company's future business prospects, plans, objectives, expectations and intentions are subject to certain risks, uncertainties and other factors that could cause actual results to differ materially from those projected or suggested in the forward-looking statements, including, but not limited to those contained in Vion Pharmaceutical's Registration Statement filed on Form S-1/A (file no. 333-83837). This press release shall not constitute an offer to sell or the solicitation of an offer to buy the common stock nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state.


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