– Proceeds To Fund Development of Novel Treatments for CNS Diseases –

SOUTH SAN FRANCISCO, Calif. – July 10, 2002 – AGY Therapeutics, Inc., a privately held biopharmaceutical company, today announced that the Company raised $31.3 million through a Series C financing round, which was led by Bear Stearns Health Innoventures and HBM Bioventures LTD. Additional investors include NIF Ventures, China Development Industrial Bank, Cheng Xin Venture Capital, MIC Capital LLC, Lotus Bioscience Ventures, Ltd., GE Capital's Capital Funding group and others. Returning investors are GIMV Venture Capital, Alta Partners, Forward Ventures, Jafco Co., Ltd., Lombard Odier and Novartis Venture Fund. JPMorgan H&Q acted as the exclusive placement agent and financial advisor for the offering.

The Company also announced that Elizabeth Czerepak, Founding Partner of Bear Stearns Health Innoventures (BSHI), and Jack Obijeski, Ph.D., Investment Advisor at HBM Bioventures, have been appointed to its Board of Directors.

Net proceeds from the financing will be used to advance the AGY's lead investigational drug candidates: AGY-203 and AGY-207 for the potential treatment of ischemic stroke and AGY-110 for the potential treatment of Alzheimer's Disease; ongoing discovery and development of other investigational product candidates for central nervous system (CNS) diseases; and general corporate purposes.

"We believe AGY's innovative, methodical approach to CNS disease drug discovery will lead to improved understanding of disease pathology and development of novel treatments," said Ms. Czerepak. "AGY is one of the few strong players in this arena and I look forward to working with the company to realize its tremendous potential."

"This financing enables us to advance our lead programs toward the clinic and to discover new targets to treat CNS diseases," said Karoly Nikolich, Ph.D., AGY's Founder and CEO. "We expect to produce small molecule drug candidates for ischemic stroke and Alzheimer's Disease by the end of this year. We also are pleased that Elizabeth and Jack have joined our Board, both of whom bring valuable knowledge and experience from such organizations as Roche, Genentech and the CDC in key areas vital to our growth."

Ms. Czerepak has over 18 years of pharmaceutical industry experience. Prior to helping found BSHI, she was Vice President of Business Development and a member of the Executive Board at BASF Pharma/Knoll Pharmaceutical Co., where she was lead negotiator for several major global deals focused on strategic growth and product development. Prior to BASF, she spent nine years at Hoffmann-La Roche in senior positions responsible for licensing, acquisitions, financial analysis and strategic planning. During that time she participated in over 25 transactions, including many equity investments in biotechnology companies and the $5.4 billion acquisition of Syntex.

Ms. Czerepak established an internal venture vehicle inside of Roche (RIMB Ventures) to facilitate start-up companies and capitalize on innovation from the Roche Institute for Molecular Biology. Ms. Czerepak began her pharmaceutical career at Merck and Co., where she was the leader of a team that developed the first comprehensive, simulation-based model for predicting pharmaceutical R&D productivity. She received a BA magna cum laude from Marshall University and a MBA in finance from Rutgers University.

Dr. Obijeski has more than 30 years of experience in microbiology, virology and biotechnology. Before joining HBM BioVentures, he served as Vice President of Business Development and Scientific Affairs at Genitope Corp., which is focused on a pharmacogenomic approach to discovery and production of patient-specific immunotherapies for cancer.

Prior to that, he was associated with Genentech, Inc., for over 15 years, serving first as Director of Vaccine Development and later as Senior Director of Product Development. Following his tenure at Genentech, he became a consultant to Genentech's Business and Corporate Development department, advising them and identifying key early stage development products and technologies that were licensed into the company's development program. Before joining Genentech, he spent 12 years at the Centers of Disease Control (CDC) as Director of Molecular Virology in the Virology Division. His group served as the World Health Organization's (WHO) molecular reference laboratory center during the global smallpox eradication program.

Dr. Obijeski is a member of several biological organizations and has served as an advisor to the WHO, National Institute of Medicine, National Institute for Biological Standardization and Control (NIBSC, England) and the Division of AIDS (NIAID), National Institutes of Health. Dr. Obijeski received his B.S. in Physics from the University of Connecticut and holds a M.S. and Ph.D. from the Waksman Institute, Rutgers University.

About AGY Therapeutics
AGY Therapeutics, Inc., a privately-held biotechnology company, is dedicated to discovering and developing novel treatments for central nervous system (CNS) diseases, including stroke, Alzheimer's disease, depression, brain tumors and obesity.

About Bear Stearns Health Innoventures, L.P.
Bear Stearns Health Innoventures (BSHI) is a $212 million venture fund that invests in private companies that are developing breakthrough technologies designed to increase productivity across the health care value chain. The Managing Partners of the fund are former high level executives from the pharmaceutical industry and include Prof. Jurgen Drews, former President of Global Research and Development and Hoffmann-La Roche, Prof. Fritz Bühler, Elizabeth Czerepak, former Vice President of Business Development at BASF Pharma and Director of Business Development at Hoffmann-La Roche, and Dr. Stefan Ryser, former Head of Global Research Staff at Hoffman-La Roche.

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