SOURCE: Upstream Biosciences Inc.

June 10, 2008 08:00 ET

Upstream Biosciences Expects Increased Interest From Big Pharma as FDA's Proposed Priority Review Voucher Program Is Implemented

Small Companies With Promising Drugs Could Benefit From Program to Encourage Development of Drugs to Fight Tropical Diseases

VANCOUVER, BC--(Marketwire - June 10, 2008) - Upstream Biosciences Inc. (OTCBB: UPBS) announced today that the United States Food and Drug Administration's (FDA) proposed priority review voucher program to stimulate development of drugs for tropical diseases could increase and accelerate the financial returns for small companies with the most promising technologies.

Joel L. Bellenson, Chief Executive Officer of Upstream, said that the priority review voucher program expected to be implemented in the third quarter of 2008 is anticipated to motivate large companies to compete for access to tropical disease drug candidates by partnering with or by acquiring small companies.

"The Duke University economists who originated the priority review voucher concept believe these transferable vouchers will accelerate the commercialization of drugs and could therefore be worth $300 million or more to large pharmaceutical companies," said Bellenson. "Small companies, such as Upstream, with viable tropical disease compounds in research and development, are anticipated to become targets of large companies for partnerships and acquisitions."

"Some big pharma executives said at the Bioventures Global Health conference held in Washington, D.C. in March -- and others have told us directly -- that they would explore collaborations or acquisitions of small companies with promising tropical disease pipelines," Bellenson said.

"The priority review voucher program, when implemented, could make a considerable difference in enabling us to accelerate our development and commercialization efforts for these drug candidates. We look forward to learning more details as the program is launched in the coming months," Bellenson said.

Upstream's advanced computational drug discovery platform has the potential to identify and optimize multiple drug candidates quickly and efficiently, and its library of compounds has produced a number of candidates with the potential to treat major tropical diseases. Upstream recently announced its third set of positive preclinical toxicity results for its candidates for malaria, trypanosomiasis and leishmaniasis. The good safety profile in animals and encouraging in vitro anti-parasitic activity seen to date with these compounds have been encouraging for Upstream and its network of international collaborators. Malaria, leishmaniasis and trypanosomiasis, which are caused by related parasites, are leading sources of disability, death and economic hardship in Africa.

About priority review vouchers

The Food and Drug Administration Amendments Act of September 2007 authorizes the FDA to award a priority review voucher to any company that obtains approval for a treatment for a neglected tropical disease. Draft regulations were circulated for comment late last year and it is expected the program will be implemented by the FDA during the third quarter of 2008. The voucher, which is anticipated to be transferable and marketable, would entitle the bearer to a priority six-month review for another product, not necessarily a tropical disease drug. Normally, the FDA review process can take from 10 to 18 months.

Economists at Duke University, who proposed the voucher concept in 2006, have calculated that reduction of the FDA approval time from 18 to six months could be worth more than $300 million to a company with a top-selling drug with a net present value close to $3 billion(1). At this level, the voucher would be expected to offset the substantial investment and risk required for discovery and development of a new treatment for a neglected tropical disease.

About Malaria

Malaria is transmitted by mosquitoes in more than 100 countries worldwide. According to the World Health Organization (WHO), an estimated 500 million people become severely ill with malaria each year, many of them children. Malaria attacks the blood and internal organs of infected people and is a leading cause of disability and death in affected countries. An estimated one million people die each year of malaria, with 90% of cases occurring in Africa. Early diagnosis and treatment can shorten the duration of the disease and prevent death or complications. However, the malaria-causing parasite's resistance to current medicines is undermining control efforts. Malaria infections are estimated to cost the economies of sub-Saharan Africa at least $12 billion annually from the direct costs of prevention and treatment as well as indirect economic costs associated with this debilitating disease.

About African Sleeping Sickness

An estimated 60 million people and 50 million cattle in sub-Saharan Africa are at risk of contracting African sleeping sickness, or trypanosomiasis infections. The trypanosome parasite, transmitted by the tsetse fly in more than 35 countries, attacks the blood and nervous systems of infected humans and animals. Without treatment, the disease is fatal. Available treatments for humans are costly, complex and toxic, requiring intravenous infusions and hospitalization. Current treatments for the animal form of the disease are toxic and are increasingly ineffective as a result of rising levels of drug resistance. Trypanosomiasis infections are estimated to cost the economies of sub-Saharan Africa at least $4.5 billion annually from lost farm income and increased malnutrition, with an estimated $600 million to $1.2 billion expended each year in control efforts and in losses in meat and milk production.

About Leishmaniasis

Leishmaniasis is a severe, geographically widespread parasitic disease caused by a protozoan flagellate and spread by the bite of infected sand flies. There are several different forms. The cutaneous type causes skin sores, the mucocutaneous form causes disfiguring lesions of the oral cavity area and the visceral type affects internal organs. Visceral leishmaniasis can be lethal if untreated. Leishmaniasis is increasing in incidence with an estimated two million cases per year, and 350 million people in 88 countries are estimated to be at risk. More than 90% of the world's cases of visceral leishmaniasis are in India, Bangladesh, Nepal, Sudan, and Brazil. Leishmaniasis is also found in Mexico, Central America, and South America.

About Upstream Biosciences, Inc.

Founded in 2004, Upstream Biosciences is a pioneer in the discovery and development of novel compounds for tropical parasitic diseases and in the development of genetic diagnostics for cancer susceptibility and drug response. Upstream's innovative approach to drug discovery and its proprietary data mining pipeline enable it to apply advanced computational approaches to generating novel drug candidates and to locating and analyzing the genetic variations important to disease progression and drug response. For more information, visit www.upstreambio.com.

(1) David B. Ridley, Henry G. Grabowski, and Jeffrey L. Moe, Developing Drugs For Developing Countries, Health Affairs, March/April 2006; 25 (2): 313-324.

Notice Regarding Forward-Looking Statements: This news release contains forward-looking statements, as that term is defined in Section 27A of the United States Securities Act of 1933, as amended, and Section 21E of the United States Securities Exchange Act of 1934, as amended. Statements in this press release which are not purely historical are forward-looking statements and include any statements regarding beliefs, plans, expectations or intentions regarding the future. Such forward-looking statements include, among others, the expectation and/or claim, as applicable, that: (i) small companies with promising drugs could benefit from the voucher program to encourage development of drugs to fight tropical diseases and increase and accelerate financial returns; (ii) the review voucher program is expected to be implemented in the third quarter of 2008; (iii) the program is anticipated to motivate large companies to compete for access to tropical diseases drug candidates by partnering with or by acquiring small companies; (iv) small companies, such as the Company, with viable tropical disease compounds in research and development, are anticipated to become targets of large companies for partnerships and acquisitions; (v) the program, if implemented, could make a considerable difference in enabling the Company to accelerate its development and commercialization efforts for drug candidates; (vi) the Company's advanced computational drug discovery platform has the potential to identify and optimize multiple drug candidates quickly and efficiently and its library of compounds has produced a number of candidates with the potential to treat major tropical diseases; (vii) the Company's compounds may aid in the development of genetic diagnostics for cancer susceptibility and drug response; and (viii) the Company's business may allow it to apply computational approaches to generate novel drug candidates and to locate and analyze the genetic variations important to disease progression and drug response. Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others: (i) the risk that the Company does not execute its business plan; (ii) the inability of the Company to keep pace with technological advancements in the field of genetic diagnostics and the treatment of tropical parasitic diseases; (iii) the Company's inability to adequately protect its intellectual property or the Company's inadvertent infringement of third party intellectual property; (iv) the Company not being able to retain key employees; (v) competitors providing better or cheaper products and technologies; (vi) markets for the Company's products not developing as expected; (vii) the Company's inability to finance its operations or growth; (viii) inability to obtain all necessary government and regulatory approvals; (ix) the inability to effectively market and commercialize the Company's technologies, including the establishment of viable relationships with third parties; (x) any changes to the current drafting or implementation of the Food and Drug Administration Amendments Act of 2007, the proposed regulations thereunder or the proposed priority review voucher program or the implementation thereof. These forward-looking statements are made as of the date of this news release and the Company assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements. Although the Company believes that the beliefs, plans, expectations and intentions contained in this press release are reasonable, there can be no assurance those beliefs, plans, expectations, or intentions will prove to be accurate. Investors should consider all of the information set forth herein and should also refer to the risk factors disclosed in the Company's periodic reports filed from time-to-time with the Securities and Exchange Commission and available at www.sec.gov.

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