Experimental Interferon-inducer ANA773 Demonstrates Antiviral Activity In Hepatitis C Treatment Trial

Phase 1 clinical trial participants treated with Anadys Pharmaceuticals' investigational hepatitis C drug ANA773 -- an oral agent that promotes the immune system's natural interferon response -- experienced a significantly greater decline in HCV RNA compared with placebo recipients, according to a recent company announcement.

Below are edited excerpts from the Anadys press release describing the study findings:

ANA773 Demonstrates Significant Antiviral Response
in Early Clinical Trial in Hepatitis C Patients

Proof of Concept Achieved for Second Anadys HCV Product Candidate

San Diego, CA -- August 11, 2009 -- Anadys Pharmaceuticals, Inc. (Nasdaq: ANDS) announced viral load data for the final cohort of hepatitis C patients in a Phase I clinical trial of ANA773, the company's oral inducer of endogenous interferons that acts via the toll-like receptor 7 (TLR7) pathway.

In patients who received 2000 mg ANA773 every other day over 10 days, the mean (+/-SEM) maximal decline in viral load was 1.3 (+/-0.4) log10, compared to a mean maximal decline of 0.3 (+/-0.1) log10 in patients who received placebo (p=0.037). Five of the eight patients who received 2000 mg ANA773 experienced a maximal decline of greater than 1 log, while none of the eight patients who received placebo experienced a decline of greater than 1 log (p<0.001 for the proportion of patients with maximal response greater than 1 log compared to placebo). The mean end-of-treatment decline was 0.6 log10 in patients who received 2000 mg ANA773 compared to 0.1 log10 in patients who received placebo. ANA773 was well-tolerated in patients throughout the course of the study and there were no serious adverse events reported.

"ANA773 has demonstrated a significant short-term antiviral response in HCV patients, comparable to many historical reports of interferon as a single agent," commented Steve Worland, PhD, Anadys' President and CEO. "Given its oral delivery and favorable tolerability profile to date, we believe that ANA773 holds promise as a potential replacement for injectable interferon products in HCV therapy. We intend to seek partnership opportunities to continue advancing the development of ANA773, with the objective of creating well-tolerated, all oral combination regimens to treat hepatitis C."

James L. Freddo, MD, Anadys' Senior Vice President, Drug Development and Chief Medical Officer added, "We are very encouraged by this data and the potential to further improve response by combining ANA773 with other agents, including ribavirin, an agent that improves response to interferon. Additionally, alternative dosing schedules may further improve pharmacological response to TLR7 activation, as was seen in preclinical studies of ANA773."

In an earlier cohort in which six patients received 1600 mg ANA773 every other day over 28 days, the mean (+/-SEM) maximal decline was 1.0 (+/-0.3) log10 (p>0.1 compared to placebo), with two patients experiencing a maximal decline of greater than 1 log during treatment. The mean end-of-treatment decline was 0.5 log10 at 1600 mg. Patients who received lower doses than 1600 mg showed correspondingly less antiviral response.

The company intends to present complete results from this study at the upcoming Annual Meeting of the American Association for the Study of Liver Diseases (AASLD), Oct. 30 - Nov. 3 in Boston.

ANA773 Phase I Clinical Trial in HCV

The Phase I clinical trial of ANA773 in HCV was conducted in the Netherlands under a two-part protocol. Part A of the study included both single and multiple doses of ANA773 in healthy volunteers. Successive cohorts of volunteers received ascending dose levels of ANA773. The primary objectives of Part A of the study were to assess safety and tolerability. Full results from Part A of the study were presented at the EASL Conference in April of this year. In Part B of the study, HCV patients received ANA773 every other day for either 28 or 10 days. The primary objectives of Part B were to assess safety, tolerability and viral load decline. Doses initially explored in Part B of the study were 800 mg, 1200 mg, and 1600 mg dosed every other day for a period of 28 days. Based on the viral load data from the 1600 mg cohort, in April of this year Anadys amended the protocol to include a fourth cohort of HCV patients who received 2000 mg of ANA773 dosed every other day over a period of 10 days.

About ANA773 and TLR Pharmacology

ANA773 is the Company's oral inducer of endogenous interferons that acts via the toll like receptor 7 (TLR7) pathway. Results from preclinical pharmacology studies have shown that ANA773 can elicit desired immune responses and that the profile of response can be modulated by both dose and schedule of administration. Results of completed 13-week GLP toxicology studies have shown that with every-other-day dosing of ANA773, immune stimulation of a magnitude believed to confer therapeutic potential can be achieved without adverse toxicology findings. The immune stimulation observed with every-other-day dosing of ANA773 in preclinical studies included induction of interferon-alpha and interferon dependent responses at levels that are sustained over 13 weeks of dosing. Furthermore, dose-dependent stimulation of innate immune response in healthy volunteers was observed in Part A of the Phase I clinical trial with ANA773 (presented at EASL, 2009).

About Anadys

Anadys Pharmaceuticals, Inc. is a biopharmaceutical company dedicated to improving patient care by developing novel medicines for the treatment of hepatitis C. The Company believes hepatitis C represents a large unmet medical need in which meaningful improvements in treatment outcomes may be attainable with the introduction of new medicines. The Company is developing ANA598, a non-nucleoside polymerase inhibitor for the treatment of hepatitis C. The Company has also investigated the potential of ANA773, an oral, small-molecule inducer of endogenous interferons that acts via the Toll-like receptor 7, or TLR7, pathway in hepatitis C.

For further information, visit www.anadyspharma.com.

8/21/09

Reference
Anadys Pharmaceuticals. ANA773 Demonstrates Significant Antiviral Response in Early Clinical Trial in Hepatitis C Patients. Press release. August 11, 2009.