XOMA to Develop Therapeutic Antibody for H1N1 and H5N1 Influenza Viruses Under $2.2 Million U.S. Government Program Managed by SRI International

BERKELEY, Calif., Sept. 23, 2009 (GLOBE NEWSWIRE) -- XOMA Ltd. (Nasdaq:XOMA) expanded its biodefense programs to include the development of a novel antibody that has been shown by Dana-Farber Cancer Institute and Harvard Medical School researchers to neutralize group 1 influenza A viruses, including the H1N1 and the H5N1 strains. The antibody, known as F10, could provide a new alternative to treating both seasonal and pandemic virus infections, particularly for patients who have drug-resistant virus strains, are immunocompromised, or have not been vaccinated.

XOMA will conduct the F10 antibody program under a $2.2 million subcontract with SRI International, a nonprofit scientific research institute based in Menlo Park, California. The subcontract will be funded through the National Institute of Allergy and Infectious Diseases (NIAID), part of the National Institutes of Health.

The F10 antibody binds to a region on group 1 influenza viruses which is present across group 1 influenza A viruses. Because the region undergoes less structural change due to mutation or reassortment than vaccine targets, an antibody that binds to it could potentially be used to treat multiple flu virus strains and be useful over multiple flu seasons. In early studies, the antibody appears to stop the spread of influenza viruses by preventing them from replicating after entering cells.

The antibody was initially developed in the laboratory of Wayne A. Marasco, M.D., Ph.D., Associate Professor of Medicine at Dana-Farber Cancer Institute and Harvard Medical School. Results from initial evaluations of the antibody were recently published in Nature Structural and Molecular Biology (Sui, et al. 2009, 16(3):265-73).

"The first line of defense against any flu virus is vaccination, although the pandemic outbreak of influenza presents challenges to quickly manufacture enough vaccine to treat the population," said Patrick J. Scannon, M.D., Ph.D. XOMA's Executive Vice President and Chief Medical Officer. "We look forward to advancing the development of a medicine that may neutralize all group 1 influenza viruses and give public health officials a new tool in the fight against pandemic and seasonal viruses."

Dr. Marasco commented, "Individuals who are immunocompromised due to illness or certain medications often cannot generate an appropriate immune response to standard vaccines. An antibody such as the one we developed could be of particular importance for these populations that are already at high risk for serious illness due to influenza."

"We are pleased that XOMA will be working with SRI on this important new project. Our goal is to rapidly optimize the anti-flu antibody for preclinical testing and so that it can be efficiently mass-produced if the need arises," said Steven B. Engle, XOMA's Chairman and Chief Executive Officer. "We are using our advanced antibody development and manufacturing capabilities to produce therapeutic antibodies for important public health threats including SARS, botulinum toxin and now group 1 flu viruses."

XOMA's responsibilities will include the evaluation and optimization of the antibody cell line for growth, productivity, manufacturability and performance in bioreactors, following which XOMA will manufacture the antibody for preclinical studies. XOMA has extensive expertise in the discovery, development, engineering and evaluation of antibody drug candidates to a wide range of infectious diseases and other targets. The company also has significant antibody manufacturing experience and the capacity in its GMP-certified facility to produce large quantities of antibody-based drugs for stockpiling and therapeutic uses.

"XOMA's expertise in the development and manufacture of monoclonal antibodies make them a natural partner in this project, one of several between our organizations," noted Jon Mirsalis, Ph.D., Managing Director of SRI's Biosciences Division and Principal Investigator of the NIAID-funded program. "We are delighted to again have them as a key part of our team."

Last fall, XOMA announced a $65 million multiyear contract to support XOMA's ongoing development of drug candidates towards clinical trials in the treatment of botulism poisoning, a potentially deadly muscle paralyzing disease. NIAID has awarded three contracts for a total of nearly $100 million to XOMA to develop anti-botulism antibodies. The first product candidate resulting from this work, XOMA 3AB, is currently undergoing IND-directed studies. In July, XOMA announced a subcontract with SRI to develop novel antibodies to treat the virus that causes sudden acute respiratory syndrome, or SARS.

About XOMA

XOMA discovers, develops and manufactures therapeutic antibodies designed to treat inflammatory, autoimmune, infectious and oncological diseases. The Company's proprietary product pipeline includes XOMA 052, an anti-IL-1 beta antibody, and XOMA 3AB, a biodefense anti-botulism antibody candidate.

XOMA has multiple revenue streams resulting from the licensing of its antibody technologies, product royalties, development collaborations, and biodefense contracts. XOMA's technologies have contributed to the success of marketed antibody products, including LUCENTIS(r) (ranibizumab injection) for wet age-related macular degeneration and CIMZIA(r) (certolizumab pegol) for rheumatoid arthritis and Crohn's disease.

The company has a premier antibody discovery and development platform that incorporates leading, unmatched capabilities in antibody phage display and a unique collection of antibody display libraries, as well as XOMA's proprietary Targeted Affinity Enhancement technology for antibody humanization and bacterial cell expression and manufacturing technologies. Bacterial cell expression is a key breakthrough biotechnology for the discovery and manufacturing of antibodies and other proteins. As a result, more than 50 pharmaceutical and biotechnology companies have signed BCE licenses.

The company's integrated processes use proprietary informatics systems that:

  --  Increase efficiencies for data management and analysis
  --  Support rational data-driven decisions thus reducing costly
      errors
  --  Increase capacity for multiple antibody programs with limited
      resources
  --  Accelerate product development and
  --  Support intellectual property filings.

In addition to developing its own products, XOMA develops products with premier pharmaceutical companies including Novartis AG, Schering-Plough Research Institute and Takeda Pharmaceutical Company Limited. XOMA has a fully integrated product development infrastructure and a team of approximately 190 employees at its Berkeley, California location. For more information, please visit http://www.xoma.com.

The XOMA Ltd. logo is available at https://www.globenewswire.com/newsroom/prs/?pkgid=5960

Forward-Looking Statements

Certain statements contained herein concerning product development or that otherwise relate to future periods are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements are based on assumptions that may not prove accurate. Actual results could differ materially from those anticipated due to certain risks inherent in the biotechnology industry and for companies engaged in the development of new products in a regulated market.

These risks, including those related to the declining and generally unstable nature of current economic conditions; the results of discovery and pre-clinical testing; the timing or results of pending and future clinical trials (including the design and progress of clinical trials; safety and efficacy of the products being tested; action, inaction or delay by the FDA, European or other regulators or their advisory bodies; and analysis or interpretation by, or submission to, these entities or others of scientific data); changes in the status of existing collaborative relationships; the ability of collaborators and other partners to meet their obligations; XOMA's ability to meet the demands of the United States government agency with which it has entered into its government contracts; competition; market demands for products; scale-up and marketing capabilities; availability of additional licensing or collaboration opportunities; international operations; share price volatility; XOMA's financing needs and opportunities; uncertainties regarding the status of biotechnology patents; uncertainties as to the costs of protecting intellectual property; and risks associated with XOMA's status as a Bermuda company, are described in more detail in XOMA's most recent filing on Form 10-K and in other SEC filings. Consider such risks carefully when considering XOMA's prospects.

This project has been funded in whole or in part with Federal funds from the National Institute of Allergy and Infectious Diseases, National Institutes of Health, Department of Health and Human Services, under Contract No. HHSN266200600011C / N01-AI-60011

CONTACT:  XOMA
          Company and Investor Contact:
          Carol DeGuzman
          510-204-7270
          deguzman@xoma.com

          Porter Novelli Life Sciences
          Media Contact:
          Carolyn Hawley
          619-849-5375
          chawley@pnlifesciences.com

Released September 23, 2009