March 4, 2007

Panacea Pharmaceuticals Initiates Pivotal, Prospective Multi-Center Study To Evaluate The Diagnostic Performance Of PC Detect(SM) For Prostate Cancer

Panacea Pharmaceuticals, Inc. announced the initiation of the pivotal, prospective multi-center clinical study to evaluate the diagnostic performance of PC Detect(SM), the Company's prostate cancer screening test. Patients are currently being enrolled in this study at 15 sites in the U.S. to demonstrate that the performance of PC Detect(SM), a simple blood test, will serve as an aid in the detection of prostate cancer in men 50 years and older who are referred for biopsy because of a tPSA > 4.0 ng/mL and/or an abnormal digital rectal exam. The addition of PC Detect(SM) to the current screening methods should reduce the number of men recommended to undergo prostate biopsies and subsequently found to be cancer- free. PC Detect(SM) will soon be available from Panacea Laboratories (, a division of Panacea Pharmaceuticals, which is fully compliant with the requirements of the Clinical Laboratory Improvement Amendments of 1988 (CLIA). The Company anticipates submission of a Pre-Market Application (PMA) to the U.S. Food and Drug Administration later in 2007 to facilitate development of a PC Detect(SM) kit, which will be commercialized through clinical laboratories around the country.

Prostate cancer is currently the most prevalent form of cancer in men and the second leading cause of male cancer death in the United States. The major screening tools for prostate cancer used by physicians to determine whether to refer a patient for a prostate biopsy are the prostate-specific antigen (PSA) and the digital rectal examination (DRE). The American Cancer Society (ACS) recommends a PSA blood test and DRE yearly, beginning at age 50. However, some controversy exists as to the utility and predictive validity of PSA for prostate cancer. PSA is a tissue-specific protein and has been shown to be elevated in both benign prostate conditions as well as prostate cancer. According to the ACS, patients with a PSA > 10 ng/mL are recommended to have a biopsy since >50% of these men have been found to have biopsies positive for cancer. A biopsy may be recommended for a non-suspicious DRE result and a PSA result of between 4-10 ng/mL as 25% of these men will also be positive for prostate cancer. DRE has a reported sensitivity of 55%-68% in asymptomatic men, but values as low as 18%-22% have been reported. The reported positive predictive value of DRE is 6%-33%. A cutoff value of a PSA 4.0 ng/mL at base- line has been found to have a sensitivity of 46% with respect to the identification of cases of prostate cancer that would occur within the next 10 years. The reported positive predictive value of PSA in asymptomatic men is 28%-35%.

PC Detect(SM), a CLIA laboratory service, is a new method for screening a patient's serum with a simple blood draw to help determine the likelihood that prostate cancer is present. PC Detect(SM) is recommended for men who have an elevated PSA and/or an abnormal DRE. PC Detect(SM) provides information to differentiate prostate cancer from benign conditions, and to help guide both the physician and patient regarding further diagnostic testing and management. Human Aspartyl (Asparaginyl) Beta-Hydroxylase (HAAH) is a cancer biomarker. HAAH has been established as an excellent biomarker for many cancer diagnoses based upon its biochemical/cellular properties and its known biological function. The protein is undetectable in sera from cancer-free individuals; thus, an elevated serum protein level of HAAH is highly diagnostic for cancer. Low/undetectable levels of HAAH, when measured with PC Detect(SM), may obviate the need for a prostate biopsy, despite a slightly elevated PSA. Thereby, a patient could avoid an unnecessary biopsy with its associated morbidity and cost.

"PC Detect(SM), in combination with PSA and DRE, should significantly enhance our ability to identify men with a high likelihood of having prostate cancer as compared to screening with PSA and DRE alone," commented Neal Shore, MD, of the Carolina Urologic Research Center and Grand Strand Urology, Myrtle Beach, South Carolina, who serves as Principal Investigator for the study. "As a practicing urologist, I look forward to using PC Detect(SM) to enhance the quality of care for my patients and reduce the number of unnecessary prostate biopsies."

"Initiation of the pivotal PC Detect(SM) marks a significant milestone for Panacea. This test should improve the physician's ability to identify men with a high likelihood of having prostate cancer, and avoid biopsies for those with a negligible risk of cancer," observed Stephen N. Keith, MD, MSPH, President and Chief Operating Officer at Panacea. "The addition of PC Detect(SM) to the list of diagnostic tests offered by Panacea Laboratories; and the FDA approval of this test and subsequent development of a kit, provide further evidence that Panacea is a leading research, product development and commercial life science company."

About Panacea's Oncology Platform

Panacea is pursuing the development of antibodies directed against human aspartyl (asparaginyl) beta-hydroxylase (HAAH) as novel agents for the treatment of cancer with liver cancer as its first intended indication. The Company is exploring both naked anti-HAAH antibodies as well as HAAH antibodies conjugated to chemotherapeutic agents. Panacea is also pursuing the development of diagnostic products based on HAAH gene expression and anti- HAAH antibodies. A test to determine responsiveness to a current therapy of choice in patients with chronic myelogenous leukemia utilizing HAAH gene expression is available through Panacea Laboratories. A proprietary blood- based assay has shown high sensitivity and specificity in the detection of a range of cancers, thus facilitating the diagnosis and therapeutic management of disease. Initial targets for the blood-based diagnostic products include prostate and liver cancers.

About Panacea Pharmaceuticals, Inc.

Panacea Pharmaceuticals, Inc. is a privately-held biopharmaceutical company focused on the development and commercialization of therapeutics and diagnostics for diseases with substantial, unmet clinical needs. The Company's product development strategy is based on novel therapeutic agents and approaches for cancer treatment, as well as acute and chronic neurodegenerative conditions, such as hypoxia-induced neurological insult, Parkinson's Disease, and Alzheimer's Disease. Panacea has an extensive patent portfolio covering its neurodegenerative and oncology technologies. Panacea Laboratories is a division of Panacea Pharmaceuticals, Inc.

More information about the Company is available at

Except for historical information presented in this press release, matters discussed herein may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward- looking statements are based on the opinions and estimates of management only as of the date of this release and are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance, or achievements expressed or implied by such statements. Factors that might cause such a difference include, but are not limited to, uncertainties related to our access to capital, the progress, costs, and results of any clinical trials undertaken by us, progress of our research and development projects, and uncertainties related to whether our product candidates would ultimately achieve commercial success. We do not undertake any obligation to update publicly any forward-looking statement, whether as a result of new information, future events, or otherwise unless required by law.

Panacea Pharmaceuticals, Inc.

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