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January 15, 2008

Kissei entered into a development and sales agreement with Pneuma Partners LLC on Calfactant.

Kissei Pharmaceutical Co., Ltd. ("Kissei"; President and CEO: Mutsuo Kanzawa) today announced that Kissei has entered into an agreement with Pneuma Partners LLC in New York, US ("Pneuma") concerning research, development and marketing for "Calfactant" in Japan, which is now under development by Pneuma in the US.

Following this agreement, Kissei will attempt to get an early approval of Calfactant for the indication of Acute Lung Injury (ALI) and Acute Respiratory Distress Syndrome (ARDS) utilizing the results of phase III clinical trial which will be conducted by Pneuma in the US.

ALI and its severe form, ARDS, are types of lung failures resulting from pneumonia, pulmonary injury, etc. There is no effective therapeutic medication for ARDS at present. About 40,000 patients are affected with ALI/ARDS every year in Japan and 30-40% of those patients pass away despite the very best care in the ICU.

Calfactant is a lung surfactant material which is a liquid suspension that coats the inner surface of the alveoli, helping the alveoli expand evenly and keep aerated in exhalation. It has been marketed for Respiratory Distress Syndrome in newborn infants in the US. Calfactant contains high concentrations of hydrophobic surfactant apoprotein B (SP-B) and is very close to natural lung surfactant. There is little SP-B in an existing surfactant preparation which has already been marketed in Japan for newborns. In recent years, there are some remarkable reports showing the fact that SP-B plays a very important role in pulmonary respiratory function. Phase II clinical trial of ALI/ARDS patients in the US revealed that Calfactant shows significant improvement in survival rate. Calfactant is expected to be a medication which has the potential to rescue significant numbers of patients who currently experience a high mortality.

About lung surfactant
Lung surfactant forms a thin, 1 molecule thick film that coats the inner surface of the alveoli. Lung surfactant consists of lipids (mainly phospholipids) and specialized proteins. A functioning lung surfactant film is essential for breathing and malfunction of the film makes effective breathing impossible. The surfactant film enables alveoli to expand smoothly during inhalation and prevents alveoli from collapsing in exhalation by reducing collapse promoting surface tension forces to almost zero at the end of each breath.

Profile of Pneuma Partners LLC
Location of headquarters: New York, US
Establishment: 2004
Chairman: Edmund A. Egan, MD
CEO: James J. Egan, JD
Employees: 7