Kosan Biosciences (KOSN)

[surf1944]

Kosan to Reacquire Epothilone Program From Roche
Kosan to Commence Phase 2 Clinical Program for KOS-1584

HAYWARD, Calif., Oct. 25 /PRNewswire-FirstCall/ -- Kosan Biosciences Incorporated (Nasdaq: KOSN) today announced that Roche and Kosan are concluding their epothilone development and commercialization collaboration. The collaborative research, development and commercialization agreement entered into in September 2002 will terminate after a transition period, following which Kosan will reacquire worldwide rights to its epothilone program and have full control of clinical development of KOS-1584 and its other epothilone product candidates going forward.

'Based on our discussions with Roche, we believe that the ending of our epothilone collaboration has been driven by a re-prioritization within Roche's research and development group rather than the value of our epothilone program,' said Robert G. Johnson, Jr., M.D., Ph.D., Kosan's President and Chief Executive Officer. 'Our control of the program permits us to determine the optimal strategy for advancing KOS-1584 into larger-scale clinical trials, potentially with a new collaborative partner, which we plan to actively seek. In the meantime, we intend to commence a Phase 2 clinical program. We continue to believe that KOS-1584 has best-in-class potential in the emerging epothilone market.'

Roche believes that KOS-1584 is worthy to proceed into Phase 2 clinical trials, and that the Roche-Kosan collaboration has been highly productive,' said Dan Zabrowski, Global Head of Roche Pharma Partnering. 'We believe that Kosan is in the best position to exploit the therapeutic and commercial potential of KOS-1584. Kosan has been an excellent development partner, and we have appreciated the opportunity to be supportive of their progress.'

Kosan does not expect the termination of its collaborative research, development and commercialization agreement with Roche to impact its financial guidance for 2007 due to transition period funding.

KOS-1584 Plans and Clinical Data

Kosan plans to commence a Phase 2 clinical program for KOS-1584. Kosan anticipates providing more information about the Phase 2 program at its upcoming Research & Development Day on October 31, 2007.

Recently, at the 2007 Annual Meeting of the American Association for Cancer Research/National Cancer Institute/European Organization for Research and Treatment of Cancer (AACR/NCI/EORTC) in San Francisco, Kosan presented updated data from an ongoing Phase 1 clinical trial of KOS-1584 demonstrating encouraging antitumor activity and tolerability in patients with solid tumors. KOS-1584 showed signs of activity in patients with non-small cell lung, ovarian, breast, prostate, pancreatic, head and neck and colon cancer.

Conference Call

Kosan will hold a conference call to discuss the termination of the collaborative research, development and commercialization agreement with Roche and related matters tomorrow at 5:30 a.m. Pacific / 8:30 a.m. Eastern. To access the live call, please dial 800.901.5231 (US) or 617.786.2961 (international), access code 41951713. Interested parties may listen to the webcast live at http://www.kosan.com by clicking on the 'Webcasts' tab under the heading 'Investors/Press.' The webcast is also being distributed over Thomson's Investor Distribution Network to both institutional and individual investors. Individual investors can listen to the call through Thomson's individual investor center at http://www.earnings.com or by visiting any of the investor sites in Thomson's Individual Investor Network. Institutional investors can access the call via Thomson's password-protected event management site, StreetEvents, at http://www.streetevents.com. A telephonic replay will be available through November 2, 2007 by dialing 888.286.8010, access code: 61167995. International callers can dial 617.801.6888, access code: 61167995.

About Kosan

Kosan Biosciences is a biotechnology company advancing two new classes of anticancer agents through clinical development -- Hsp90 (heat shock protein 90) inhibitors and epothilones. Kosan is leveraging its proprietary discovery platform to generate a pipeline of potentially significant product candidates, primarily in the area of oncology.

Hsp90 inhibitors have a novel mechanism of action targeting multiple pathways involved in cancer cell growth and survival. Tanespimycin (KOS-953) is being tested in combination with bortezomib (Velcade(R)) in patients with multiple myeloma in a registration program called TIME. Tanespimycin is also being studied in HER2-positive metastatic breast cancer in combination with trastuzumab (Herceptin(R)), and as monotherapy in metastatic melanoma. Intravenous and oral formulations of Kosan's second-generation Hsp90 inhibitor, alvespimycin (KOS-1022), are being evaluated in Phase 1 clinical trials in hematological cancers and in HER2-positive metastatic breast cancer.

Epothilones inhibit cell division with a mechanism of action similar to taxanes, one of the most successful classes of anti-tumor agents. KOS-1584 is in Phase 1 clinical trials in patients with solid tumors.

Kosan's motilin agonist compound, KOS-2187, licensed to Pfizer, is in a Phase 1 safety trial, with plans to pursue development in gastroesophageal reflux disease (GERD).

For additional information on Kosan Biosciences, please visit the company's website at http://www.kosan.com.

This press release contains forward-looking statements within the meaning of the 'safe harbor' provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, but are not limited to, statements regarding the further development (including the planned commencement of one or more Phase 2 clinical trials and the timing thereof) and potential safety, efficacy, commercialization and other characteristics of KOS-1584, Kosan's plans to seek a new collaborative partner for its epothilone program and the anticipated financial impact of the termination of its collaborative research, development and commercialization agreement with Roche. Any statements contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. There are a number of important factors that could cause the results of Kosan to differ materially from those indicated by these forward-looking statements, including, among others, risks related to Kosan's expectation that additional financing will be required, Kosan's past dependence on its collaboration with Roche for development of its epothilone product candidates, Kosan's ability to enter in to new partnering arrangements and the highly uncertain nature of the progress and results of Kosan's testing of KOS-1584, including the risk that studies may not demonstrate safety and efficacy sufficient to initiate additional clinical trials, continue clinical development, obtain the requisite regulatory approvals or result in a marketable product, competition and other risks detailed from time to time in Kosan's SEC reports, including its Quarterly Report on Form 10-Q for the quarter ended June 30, 2007, and other periodic filings with the SEC. Kosan does not undertake any obligation to update forward-looking statements.

Velcade(R) (bortezomib) is a registered trademark of Millennium Pharmaceuticals, Inc. Herceptin(R) (trastuzumab) is a registered trademark of Genentech, Inc.

SOURCE Kosan Biosciences Incorporated

Source: PR Newswire (October 25, 2007 - 8:45 PM EDT)