News Release

Yamanouchi Pharmaceutical Co., Ltd.

Taiho and Yamanouchi Sign a License Agreement on IPD-1151T, a drug for Interstitial Cystitis

January 23, 2003

Tokyo January 23, 2003 - Taiho Pharmaceutical Co., Ltd. ("Taiho"; President: Tohru Usami) and Yamanouchi Pharmaceutical Co., Ltd. ("Yamanouchi"; President and CEO: Toichi Takenaka) announced that the two companies have signed a license agreement on IPD-1151T (generic name: suplatast tosilate), which was originated by Taiho and is being developed for the treatment of interstitial cystitis and chronic non-bacterial prostatitis as additional indications. This agreement grants Yamanouchi the exclusive worldwide rights (except Japan) to develop, manufacture and market IPD-1151T. Taiho will manufacture the suplatast bulk material and retain the right to co-promote or co-market the product with Yamanouchi.

Taiho is already marketing IPD-1151T under the brand name of IPD(R) for the treatment of bronchial asthma, allergic rhinitis and atopic dermatitis in Japan. It is now conducting Phase II clinical trials in Japan in order to obtain additional indications for interstitial cystitis and chronic non-bacterial prostatitis. It has been considering licensing of this compound for overseas clinical development and marketing. Yamanouchi is looking for promising compounds in the field of urology in order to expand its product pipeline in the United States and Europe and has found that IPD-1151T fits this policy. Yamanouchi will undertake the global clinical development of IPD-1151T except Japan.

IPD-1151T shows anti-inflammatory effects by inhibiting the production of cytokines (IL-4 and IL-5) deriving from type 2 helper T cells (Th2) involved in immune reactions. Its therapeutic effects on interstitial cystitis have been reported in small-scale clinical trials(*). Based on findings from these trials, Taiho has been conducting clinical trials to obtain regulatory approval for the additional indications.

The exact etiology of interstitial cystitis is unclear, but suspected etiological factors include allergic reactions, autoimmune disorders, and urinary tract infections. It is associated with severe pain in the lower abdomen in addition to other symptoms such as pollakiuria and urinary urgency. It is a refractory disease and no effective therapy has been established. No large-scale epidemiological studies have been conducted. According to the literature, however, the number of patients is estimated to range between 450,000 and 1 million in the United States, and women account for nearly 90% of this figure

*. Ueda T. Journal of Urology 164: 1917-20, 2000