Genetic Variation Associated with Treatment Response in a Clinical Study of a New Atypical Antipsychotic Fiaptatm (iloperidone)

ROCKVILLE, Md., February 29, 2008 /PRNewswire-FirstCall/ -- A study reported in the journal Pharmacogenomics suggests that a genetic variation in the Ciliary Neurotrophic Factor gene (CNTF) may affect response to antipsychotic treatment. The study, conducted by Vanda Pharmaceuticals Inc., included patients with acute symptoms of schizophrenia who were treated either with Fiapta(TM) (iloperidone), a novel atypical antipsychotic agent currently under review with the FDA, or placebo. Patients were also studied for a genetic variation in the CNTF gene. CNTF is a neurotrophic factor important for neuronal survival and recovery after injury. About 75% of the population carry two intact copies of the CNTF protein while 25% carry one or two truncated copies of the protein.

As previously reported in the clinical study overall, it was shown that Fiapta(TM) was significantly more effective than placebo in treating both the positive and negative symptoms of schizophrenia. In addition, Fiapta(TM) showed significant improvement from baseline in all symptoms across all patient genotypes of CNTF.

In the patient population carrying both intact copies of CNTF (representing 75% of the population), Fiapta(TM) treatment was significantly better than placebo in symptom improvement. In patients carrying at least one truncated copy of the CNTF protein, placebo and Fiapta(TM) treated patients had a significant improvement from baseline indicating an enhanced placebo response among this group of patients.

"This is a pioneering effort in understanding why some people respond to antipsychotic medication and others do not. The results of this prospective study on the genetics of drug response offer tantalizing clues on the involvement of neurotrophic factors in schizophrenia," said Steven G. Potkin, MD, Professor of Psychiatry, Robert R. Sprague Chair in Brain Imaging, and Director, Clinical Psychiatric Research at the University of California, Irvine.

These findings suggest that neurotrophic factors like CNTF and genetic variations within them may play important roles in antipsychotic response and the course of illness of patients with schizophrenia. "This study is an important first step towards understanding the role of genetic variation in antipsychotic treatment response and eventually the introduction of personalized medicine in the treatment of schizophrenia," noted Dr. Anil Malholtra, MD, Director, Division of Psychiatry Research, The Zucker Hillside Hospital.

About Vanda Pharmaceuticals Inc.

Vanda Pharmaceuticals Inc. is a biopharmaceutical company focused on the development and commercialization of clinical-stage product candidates for central nervous system disorders. The company has three product candidates. Vanda's lead product candidate, Fiapta(TM) (iloperidone), for which Vanda has recently submitted an NDA to the FDA, is a compound for the treatment of schizophrenia. Vanda's second product candidate, VEC-162, is a compound for the treatment of sleep and mood disorders, which is currently in Phase III for chronic insomnia. Vanda's third product candidate, VSF-173, is a compound for the treatment of excessive sleepiness in Phase II. For more on Vanda Pharmaceuticals Inc., please visit http://www.vandapharma.com.

Note Regarding Forward-Looking Statements

This release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding Vanda's plans for its product candidates. Words such as, but not limited to, "look forward to," "believe," "expect," "anticipate," "estimate," "intend," "plan," "targets," "likely," "will," "would," "should," and "could," and similar expressions or words identify forward-looking statements. Such forward-looking statements are based upon current expectations that involve risks, changes in circumstances, assumptions and uncertainties. Vanda is at an early stage of development and may not ever have any products that generate significant revenue. Important factors that could cause actual results to differ materially from those reflected in Vanda's forward-looking statements include, among others, a failure of Vanda's product candidates to be demonstrably safe and effective, a failure to obtain regulatory approval for the company's products or to comply with ongoing regulatory requirements, a lack of acceptance of Vanda's product candidates in the marketplace, a failure of the company to become or remain profitable, Vanda's inability to obtain the capital necessary to fund its research and development activities, a loss of any of the company's key scientists or management personnel, and other factors that are described in the "Risk Factors" section (Part II, Item 1A) of Vanda's report on Form 10-Q for the quarter ended September 30, 2007 (File No. 000-51863). No forward-looking statements can be guaranteed and actual results may differ materially from such statements. The information in this release is provided only as of the date of this release, and Vanda undertakes no obligation to update any forward-looking statements contained in this release on account of new information, future events, or otherwise, except as required by law.

CONTACT: Media, Rachel Martins, Vice President of Ketchum,+1-646-935-4137, , for Vanda PharmaceuticalsInc.; or Steven Shallcross, Chief Financial Officer of VandaPharmaceuticals Inc., +1-240-599-4537; Rachel.martins@ketchum.com steven.shallcross@vandapharma.com

Web site: http://www.vandapharma.com//

Ticker Symbol: (NASDAQ-NMS:VNDA)

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Posted: February 2008

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