Novelos NOV-002 demonstrates positive results in Phase 2 neoadjuvant breast cancer trial

Novelos Therapeutics, Inc. (OTCBB: NVLT), a biopharmaceutical company developing therapeutics to treat cancer, announced that today a poster highlighting positive results in a Phase 2 trial of NOV-002 in combination with neoadjuvant chemotherapy treatment in patients with stage IIB-IIIC HER-2/neu negative invasive breast cancer is being presented by the Braman Family Breast Cancer Institute at Sylvester Comprehensive Cancer Center at the University of Miami Miller School of Medicine at the AACR Breast Cancer Symposium in San Antonio, TX. Alberto Montero, MD, Assistant Professor of Medicine at the Miller School and medical oncologist at Sylvester, is the Principal Investigator. The poster, Phase 2 study of neoadjuvant treatment with cellular redox modulator NOV-002 in combination with doxorubicin and cyclophosphamide followed by docetaxel (AC-T) in patients with stage II-III HER-2(-) breast cancer, can be viewed at www.novelos.com 'Our Products', 'NOV-002' section.

“We are very pleased that NOV-002 demonstrated positive results in this Phase 2 neoadjuvant breast cancer trial, and we will continue to explore NOV-002 development in combination with immunogenic chemotherapy”

The Phase 2 open-label, single-arm, Simon 2-Stage breast cancer trial was designed to determine if preoperative administration of NOV-002 in combination with doxorubicin and cyclophosphamide followed by docetaxel (AC-T) results in at least a doubling in the rate of pathologic complete response (pCR) compared to a historical control. The trial efficacy criterion of 12 pCRs was met in July 2010 prior to all patients completing the trial. The Phase 2 trial design can be found on www.clinicaltrials.gov - ID: NCT00499122, or via a link at www.novelos.com 'Clinical Trials' section.

"In this trial where now 41 breast cancer patients have been enrolled from three different hospitals we have 15 confirmed pathologic complete responses out of 38 patients (39%) who have undergone surgery, which is higher than what has been previously reported with preoperative chemotherapy, consisting of doxorubicin and cyclophosphamide followed by docetaxel, in HER-2 negative breast cancer patients," said Dr. Montero. "By comparison the published pCR rate in several trials with an anthracycline followed by a taxane chemotherapy in patients with HER-2 negative breast cancer is in the range of 10-20%. These results I believe indicate that further investigation of NOV-002 plus chemotherapy in breast cancer is warranted."

"The efficacy seen in this trial is of particular interest in relation to our growing understanding of NOV-002's mechanism of action," said Christopher Pazoles, Ph.D., Vice President of Research & Development of Novelos. "Recent findings suggest that, due to its anti-tumor immunomodulatory activities, NOV-002 may be particularly well-suited for combination with certain 'immunogenic' chemotherapy agents including cyclophosphamide and doxorubicin which are commonly used to treat breast cancer and are part of the treatment regimen used in this trial."

Additionally, on November 30, 2010, Novelos effected a share exchange by issuing 340,935,801 shares of common stock in exchange for all outstanding shares of two series of preferred stock. The preferred stock represented a cumulative liquidation preference of $27.3 million prior to exchange into common stock and had been convertible at $0.65 per common share. In the share exchange, the common stock was issued at $0.08 per common share, calculated as the liquidation preference divided by the number of shares issued, representing a 100% premium over market price. The share exchange eliminated special voting rights previously held by the preferred stockholders, $2.4 million of accumulating annual dividends and the $27.3 million liquidation preference. Following the share exchange, Novelos has approximately 453 million shares of common stock outstanding.

"We are very pleased that NOV-002 demonstrated positive results in this Phase 2 neoadjuvant breast cancer trial, and we will continue to explore NOV-002 development in combination with immunogenic chemotherapy," said Harry Palmin, President and CEO of Novelos. "Meanwhile, the recently completed share exchange simplifies our capital structure and is expected to facilitate ongoing efforts to expand our oncology pipeline through licensing or strategic acquisition."