PPL Therapeutics and Bayer Announce Delay of Phase III AAT Trial

Edinburgh, Scotland

March 18, 2002 

PPL Therapeutics and Bayer Corporation, Biological Products Business Group, (Bayer Biological Products) today announced a further delay of the start of the Phase III clinical trials of PPL’s transgenically produced recombinant alpha-1 antitrypsin (recAAT) for the treatment of alpha-1 antitrypsin deficiency (hereditary emphysema).

In 2001, a Phase II study was conducted to confirm the safety and tolerability of an increased recAAT concentration administered via a new inhalation device. After reviewing the preliminary data from the Phase II study, the FDA suggested that further analysis be conducted in order to understand why a small number of Phase II subjects did not complete the study. Analyses conducted over the past few months were unfortunately inconclusive. As a result the companies have decided to investigate possible factors that might have caused these subjects not to complete the study. These include route of administration, dose, purity and formulation related issues.

Commencement of the Phase III trial will await the completion of this work. The companies expect this development to delay regulatory approval of recAAT until 2007. However, both companies are actively exploring approaches to shortening the clinical development plan that could expedite the launch of the product.

Dr. Gunnar Riemann, Global Head of Bayer Biological Products, said, "Bayer remains committed to recAAT, and its potential to greatly increase product supply. Bayer’s long-standing commitment to this collaboration and to persons with alpha-1 antitrypsin deficiency remains unwavering; we will continue our efforts to provide safe and effective treatments to the alpha-1 community."

Geoff Cook, CEO of PPL, said, "PPL is disappointed to have to delay the pivotal trial for this potentially break-through product that could improve the lives of patients with alpha-1 antitrypsin deficiency. We are fully committed to this project, and remain confident that we can meet these challenges."

RecAAT offers the potential to greatly increase AAT supply because it is not dependent on the availability of human plasma. In addition, an aerosol formulation of recAAT would allow delivery directly to the lungs via an inhalation system intended to improve patient convenience and, thus, compliance.

About Bayer

In August 2000, Bayer Biological Products and PPL signed an agreement to develop and market an aerosol formulation of recAAT. Under the agreement, Bayer is responsible for clinical development and marketing. PPL is responsible for exclusive product manufacturing.

Prolastin®, Alpha-1 Proteinase Inhibitor (Human), is currently the only product available for the treatment of alpha-1 antitrypsin deficiency and is manufactured by Bayer Biological Products. Company officials are eager to bring the next generation of safe and effective treatments for this deficiency to market. Complete prescribing information for Prolastin®, Alpha-1 Proteinase Inhibitor (Human) is available at www.bayerdirect.com.

Best known for its flagship product, Bayer Aspirin, Bayer Corporation produces a broad range of health care, life sciences, and chemical products that help diagnose and treat diseases, purify water, preserve local landmarks, protect crops, advance automobile safety and durability, and improve people’s lives.

Headquartered in Pittsburgh, Bayer Corporation had sales of $10.1 billion in 2000 and is one of Fortune magazine’s Most Admired Companies. The company employs 23,200 people. It is a member of the worldwide Bayer Group, a $29 billion international health care and chemicals group based in Leverkusen, Germany.

The Bayer Group (BAYG.DE) stock is a component of the DAX, and is listed on multiple foreign exchanges including the NYSE (BAY)

About PPL Therapeutics
1. PPL Therapeutics is a biopharmaceutical company, which is one of the world’s leaders in the application of transgenic animal technologies to the development and production of human proteins for therapeutic and nutritional applications.
2. PPL’s patented transgenic production of human proteins involves the introduction of copies of human DNA into the genetic material of another species. The resulting transgenic animals express the human gene product (protein) in the mammary gland allowing its collection and purification during lactation. The technique, which offers the opportunity to produce human proteins economically and in potentially unlimited quantities, is based on patented technology developed by the Roslin Institute in the 1980s for which PPL holds an exclusive licence.
3. PPL’s three lead products are AAT, fibrinogen, and bile salt stimulated lipase (BSSL).
4. PPL is the only company to offer a wide range of animals for transgenic protein production, including sheep, cows, rabbits, and pigs.
5. Further information on PPL, its products, and technologies can be found at: www.ppl-therapeutics.com .

Forward-Looking Statements
This news release contains forward-looking statements based on current assumptions and forecasts made by Bayer Group management. Various known and unknown risks, uncertainties and other factors could lead to substantial differences between the actual future results, financial situation, development or performance of the company and the estimates given here. The company assumes no liability whatsoever to update these forward-looking statements or to conform them to future events or developments.

Contact:
Geoff Cook, CEO
PPL Therapeutics plc
Telephone: +44 (0)131 440 4777

Tricia McKernan
Manager, Public Policy & Communications
Bayer Corporation
Telephone: +1 919-316-6349