Kosan Presents Promising Phase 1 Data on Second-Generation Hsp90 Inhibitor, Alvespimycin, Showing Antitumor Activity in Refractory Breast and Ovarian Cancers at ASCO

Clinical Benefit Shown in 35% of HER2-Positive Metastatic Breast Cancer Patients

HAYWARD, Calif., June 04, 2007 /PRNewswire-FirstCall/ -- Kosan Biosciences Incorporated presented data from a Phase 1 clinical trial showing that alvespimycin, its second-generation Hsp90 inhibitor, demonstrated promising antitumor activity and tolerability in combination with trastuzumab (Herceptin(R)) in patients with refractory HER2-positive metastatic breast cancer, and in patients with refractory ovarian cancer who were progressing on standard chemotherapy. Data from the ongoing trial in patients with solid tumors were presented on Saturday, June 2, 2007, by Kathy Miller, M.D., Indiana University, Indianapolis, IN, in a poster, titled, "Phase 1 Trial of Alvespimycin (KOS-1022; 17-DMAG) and Trastuzumab," at the 2007 Annual Meeting of the American Society of Clinical Oncology (ASCO).

"Alvespimycin's antitumor activity is interesting given the highly refractory stage of disease of the patients in this Phase 1 trial and the drug's mechanism of action," said Clifford A. Hudis, M.D., Chief of the Breast Cancer Service, Memorial Sloan-Kettering Cancer Center, and the study's senior author. "Alvespimycin's potential to work additively or synergistically with standard chemotherapy agents suggests that it could be an important addition to the treatment paradigm for HER2-positive metastatic breast cancer."

"These encouraging Phase 1 data support our strategy to pursue alvespimycin as a potential treatment for HER2-positive metastatic breast cancer and to advance into Phase 2 trials later this year," said Robert G. Johnson, Jr., M.D., Ph.D., Kosan's President and Chief Executive Officer. "Kosan has the unique advantage of having two promising Hsp90 inhibitors, tanespimycin and alvespimycin, in clinical development at the same time. Both of these compounds are showing meaningful clinical benefit and a high degree of tolerability in multiple tumor types, underscoring the therapeutic potential of this important class of anticancer compounds and strengthening Kosan's leadership in the Hsp90 inhibitor area."

Phase 1 Alvespimycin Results

Alvespimycin is a second-generation Hsp90 inhibitor that has demonstrated the potential to disrupt the activity of multiple oncogenes and cell signaling pathways implicated in tumor growth, including HER2, a key signaling pathway in breast cancer.

The Phase 1 trial of alvespimycin in combination with trastuzumab was designed to identify the recommended Phase 2 dose through the evaluation of toxicity and activity in patients with solid tumors. Patients were enrolled in three dose cohorts. The dosing schedule for alvespimycin was a one-hour weekly intravenous infusion of 60, 80 or 100 mg/m2 administered along with the standard dose of trastuzumab.

Of the 25 heavily-pretreated patients enrolled in the trial, 22 patients had HER2-positive breast cancer and 3 patients had ovarian cancer (HER2 status unknown). The median number of prior regimens excluding hormonal therapy was 6.5, and the median prior trastuzumab-containing regimens for the HER2-positive breast cancer patients was 4. Clinical benefit was observed in 35% of patients (7 of 20 evaluable) with HER2-positive metastatic breast cancer:

    -- 1 patient (13 prior regimens, including progression on single-agent

       lapatinib and 3 prior trastuzumab-containing regimens) showed near

       complete resolution of lung metastases by CT/PET with significant

       improvement in shortness of breath (8 cycles at 60 mg/m2);


    -- 1 patient (11 prior regimens, 5 with trastuzumab, 2 with lapatinib)

       showed 10% reduction in tumor mass (change consistent with tumor

       necrosis) and a decrease in 2 tumor markers (64% CEA, 63% CA27); this

       patient continues on study;


    -- 5 patients had extended stable disease (4, 5, 6+, 11+ and 12 months).


    Of the 3 patients with ovarian cancer,


    -- 1 patient (13 prior regimens) who was on study for more than 16 months

       had a near complete resolution of ascites and left pleural effusion,

       and an 83% decrease in CA125.

Toxicities were mainly Grade 1 and 2 (diarrhea, fatigue, headache, arthralgia, nausea). One patient with multiple prior trastuzumab and doxorubicin containing regimens experienced a dose-limiting toxicity of hypoxia and left ventricular ejection fraction reduction at 100 mg/m2. Two patients treated at 80 mg/m2 experienced reversible Grade 3 ocular keratitis; following a treatment holiday both patients continued therapy with reduced doses (one patient remains on study).

Data from a separate 13-patient ongoing Phase 1 trial of alvespimycin also administered weekly were presented. These data showed a confirmed partial response in one patient with hormone refractory prostate cancer, who remains on study after 12 months, and prolonged stable disease in 2 patients, including one patient with prostate adenocarcinoma (on study for 22 weeks) and one patient with metastatic melanoma (on study for 15 weeks). There was no dose-limiting or Grade 3 or 4 drug-related toxicity associated with weekly doses of alvespimycin at up to 40 mg/m2. These data were presented by investigators from the United Kingdom on Sunday, June 3, 2007, in a poster titled "A Phase I Trial of the Heat Shock Protein 90 (Hsp90) Inhibitor 17-Dimethylaminoethylamino-17-Demethoxygeldanamycin (17-DMAG, Alvespimycin) Administered Weekly)."

Alvespimycin Development Plan

Kosan's Phase 1 trial of alvespimycin in combination with trastuzumab is continuing, with plans to add paclitaxel (Taxol(R)) to the regimen.

Kosan plans to initiate a Phase 2 study of alvespimycin as monotherapy in patients with HER2-positive metastatic breast cancer who have not previously been treated with trastuzumab. This trial will be conducted in Eastern Europe. Kosan anticipates that regulatory filings to support initiation of this clinical trial will be completed by mid-year 2007. Kosan plans to initiate a larger, international Phase 2/3 trial of alvespimycin in combination with trastuzumab in patients with HER2-positive metastatic breast cancer later in 2007.

Kosan also plans to pursue development of alvespimycin as a treatment for patients with acute myeloid leukemia (AML).

Kosan is also testing alvespimycin delivered orally in a Phase 1 dose escalation trial on both daily and every other day schedules. While dose escalation continues in this trial, early results have shown prolonged stable disease in patients with fibrosarcoma, hemangioendothelioma, melanoma and renal cell carcinoma with a favorable side effect profile.

About Kosan

Kosan Biosciences is a biotechnology company advancing two new classes of anticancer agents through clinical development -- Hsp90 (heat shock protein 90) inhibitors and epothilones. Kosan is leveraging its proprietary discovery platform to generate a pipeline of potentially significant product candidates, primarily in the area of oncology.

Hsp90 inhibitors have a novel mechanism of action targeting multiple pathways involved in cancer cell growth and survival. Kosan's proprietary formulation of tanespimycin (KOS-953) is currently in Phase 1 and 2 clinical trials, primarily for multiple myeloma in combination with Velcade(R) (bortezomib) and HER2-positive metastatic breast cancer in combination with Herceptin(R) (trastuzumab). In addition, intravenous and oral formulations of Kosan's second-generation Hsp90 inhibitor, alvespimycin (KOS-1022), are being evaluated in Phase 1 clinical trials.

Epothilones inhibit cell division with a mechanism of action similar to taxanes, one of the most successful classes of anti-tumor agents. KOS-1584 is in Phase 1 clinical trials in patients with solid tumors. Kosan's epothilone program is partnered with Roche through a global development and commercialization agreement.

This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 (the "Act"). Such forward-looking statements include but are not limited to the further development and potential safety, efficacy, commercialization, and other characteristics of Kosan's Hsp90 product candidates; and initiations of clinical trials and the timing thereof. Any statements contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. There are a number of important factors that could cause the results of Kosan to differ materially from those indicated by these forward-looking statements, including, among others, risks related to the development of Kosan's Hsp90 product candidates, including the risk that studies may not demonstrate safety and efficacy sufficient to initiate clinical trials, continue clinical development, obtain the requisite regulatory approvals or to result in a marketable product; and other risks detailed from time to time in the Company's SEC reports, including its Quarterly Report on Form 10-Q for the quarter ended March 31, 2007 and other periodic filings with the SEC. Kosan does not undertake any obligation to update forward-looking statements.

Velcade(R) (bortezomib) is a registered trademark of Millennium Pharmaceuticals, Inc.

Herceptin(R) (trastuzumab) is a registered trademark of Genentech, Inc.

Taxol(R) is a registered trademark of Bristol-Myers Squibb Company.

Posted: June 2007

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