New pre-Clinical NS5A HCV Drug Program Headed by Rich Colonno

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New pre-Clinical NS5A HCV Drug Program Headed by Rich Colonno

XTL Biopharmaceuticals Signs $108 Million Deal for the Licensing of

its Pre- Clinical Program in Hepatitis C to Presidio Pharmaceuticals

Thu, 20 Mar 2008 11:35:40 GMT

XTL Biopharmaceuticals Ltd. PressRelease

VALLEY COTTAGE, N.Y., March 20 /PRNewswire-FirstCall/ -- XTL

Biopharmaceuticals Ltd. announced the licensing of its pre-clinical

program in Hepatitis C focused on the NS5A target (the " Program " ) to

San-Francisco based Presidio Pharmaceuticals, Inc. Presidio is a

private biotechnology company focused on the development and

commercialization of anti-viral therapeutics and is backed by some of

the most prominent investors in the biotechnology sector, including

Panorama Capital, Bay City Capital, Baker Brothers Investments, and

Ventures West. Presidio's scientific team is headed by Dr.

Colonno, who until recently was Vice President of Infectious Disease

Drug Discovery at Bristol-Myers Squibb, where he was responsible for

Bristol-Myers Squibb's antiviral drug discovery efforts, including

their Hepatitis C and B and HIV programs.

Under the license agreement, Presidio becomes responsible for all

further development and commercialization activities and costs

relating to the Program. XTL will receive an upfront payment of $4

million, and up to an additional $104 million upon reaching certain

development and commercialization milestones. In addition, XTL will

receive a royalty on direct product sales by Presidio, and a

percentage of Presidio's income if the Program is sublicensed by

Presidio to a third party.

Ram Waisbourd, Vice President of Business Development of XTL,

commented: " We have great confidence in Presidio's ability to move

the Program forward rapidly. We believe that Presidio has a dynamic

and experienced management team, and a solid scientific team headed

by Dr. Colonno -- who was a major contributor to the

discovery and advancement of several antiviral drug candidates into

clinical trials, two of which, atazanavir for HIV, and entecavir for

Hepatitis B, are currently approved drugs. "

Ron Bentsur, XTL's CEO commented: " We are excited about this

licensing transaction with a motivated and capable partner such as

Presidio. This transaction allows us to solidify our financial

position by bringing in $4 million dollars in cash and eliminating

the ongoing development expense of the Program, while preserving a

significant share in the Program's future success. We believe that

this transaction extends our financial resources well into Q1 2009,

and provides us with a financial cushion as we head towards the

completion and announcement of results from the Bicifadine Phase 2b

study, expected in Q4 2008. "

The Program focuses on the development of novel small molecule

inhibitors against the Hepatitis C virus, and is presently in

advanced stages of lead optimization. The current lead compounds

target NS5A - a viral protein that is essential for viral production.

NS5A is distinct from the protease and polymerase. The Program's lead

compounds are highly potent inhibitors of viral replication in the

replicon assay, which is known to have good correlation with clinical

efficacy and is currently the leading method for preclinical testing

of inhibitors of the Hepatitis C Virus.

ABOUT XTL BIOPHARMACEUTICALS LTD.

XTL Biopharmaceuticals Ltd. ( " XTL " ) is engaged in the development of

therapeutics for the treatment of diabetic neuropathic pain and HCV.

XTL is developing Bicifadine, a serotonin and norepinephrine reuptake

inhibitor, for the treatment of diabetic neuropathic pain, which is

currently in a Phase 2b study. XTL has out-licensed its novel pre-

clinical HCV small molecule inhibitor program. XTL also has an active

in-licensing and acquisition program designed to identify and acquire

additional drug candidates. XTL is publicly traded on the NASDAQ and

Tel-Aviv Stock Exchanges .

Contact: Ron Bentsur, Chief Executive Officer Tel: +1-

ext. 225

ABOUT PRESIDIO

Presidio Pharmaceuticals, Inc. is a specialty pharmaceutical company

focused on the discovery, in-licensing, development and

commercialization of novel therapeutics for viral infections,

including HIV and HCV. Presidio has raised over $27 million in

financing from Panorama Capital, Baker Brothers Investments, Bay City

Capital, Ventures West, Nexus Medical Partners, and Sagamore

Bioventures. For more information, please visit our website at

http://www.presidiopharma.com/.

Contact: K. Haffar, Ph.D. President and Chief Executive Officer

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