Use of computer-assisted drug design in drug discovery

Metabasis Therapeutics has announced that on March 27, 2007 at the American Chemical Society 233rd National Meeting and Exposition in Chicago, Dr. M. Rami Reddy presented, "Use of Computer-Assisted Drug Design in Drug Discovery: Limitations and Advantages of Available Computational Methods."

Dr. Reddy is the senior director, Computational Chemistry and Structural Biology at Metabasis Therapeutics.

The presentation included certain calculations using the Quantum Mechanics-Based Free Energy Perturbation (FEP) Methodology, demonstrating for the first time, its ability to accurately calculate relative inhibitory potencies of potential drug candidates. As part of the Rational Drug Design Symposium, Dr. Reddy showed that the method accurately predicted the potencies of several inhibitors of fructose-1,6-bisphosphatase, an enzyme that is considered a potential new drug target for type 2 diabetes. This methodology has been used by Metabasis in its drug discovery programs for type 2 diabetes.

For the last 3 years, Dr. Reddy and Dr. Mark Erion, Metabasis' executive vice president of research and development and chief scientific officer, in consultation with Dr. U. Chandra Singh, president and chief scientific officer of AM Technology, have been developing this computational strategy. The method was previously shown to accurately predict various molecular properties that are frequently important for drug design. The results from the earlier calculations were consistent with the corresponding experimental data and represent an improvement over the conventional FEP methods. Computational details and the initial results that both validated the approach and demonstrated its accuracy and utility were published in the Journal of the American Chemical Society 2004, 126, 6224-6225 and the Journal of Computational Chemistry 2007, 28, 491-494.

"The use of Quantum Mechanics in these calculations eliminates time-consuming and often difficult processes that are required to complete conventional calculations and consequently may enable the future automation of FEP calculations," stated Dr. Erion. "It has the potential to reduce the time it takes to discover clinical candidates by focusing medicinal chemistry efforts on compounds with a greater chance for success. In addition, the automation of FEP calculations has the potential to enhance compound throughput and consequently enhance our ability to more readily take advantage of the higher accuracy associated with FEP calculations in our drug design efforts."

Dr. Reddy is one of the world leaders in the research field of CADD and has an extensive pharmaceutical industry experience in developing CADD technology and its application for the discovery of drugs for human diseases. He is an author of approximately 100 scientific publications as well as an inventor on four patents. He is also an author of several Computer-Aided Drug Design (CADD) programs and an editor of two Rational Drug Design text books. In addition, he serves as an Executive Editor of the journal "Current Pharmaceutical Design" and has served as an editor for two special issues on Computer Aided Drug Design. Since 1997, he has organized five symposiums on computational aspects of Rational Drug Design as part of American Chemical Society National Meetings.

Currently, Dr. Reddy is the head of the Computer Aided Drug Design and Structural Biology groups at Metabasis Therapeutics. He is responsible for Metabasis' Rational Computer Aided Design projects, which includes CADD approaches, Cheminformatics and Structural Biology.

Prior to joining Metabasis and its predecessor, Gensia, in 1991, Dr. Reddy worked at Agouron (now Pfizer) for approximately three years, and was a member of the AIDS and Cancer research projects. CADD and Structural Biology efforts at Agouron contributed significantly to the discovery of several clinical candidates for cancer and one FDA-approved drug for AIDS (Viracept). In 1995, Agouron Pharmaceuticals obtained FDA approval for Viracept to treat AIDS patients as part of a "cocktail" of drugs.

Dr. Reddy received his Ph. D. in Computational Chemistry from the University of Hyderabad, India and spent a few years as a postdoctoral fellow working in several areas of computational chemistry/biology, particularly in the development and use of Monte Carlo and Molecular Dynamics Simulation Programs for small and macromolecules of biological interest.

About Metabasis (www.mbasis.com):

Metabasis Therapeutics is a biopharmaceutical company focused on the discovery, development and commercialization of novel drugs to address some of the world's most widespread and costly chronic diseases. By applying our proprietary technologies and scientific expertise, including unique capabilities for targeting the liver and liver pathways, the Company has established a pipeline that includes preclinical and clinical product candidates targeting metabolic diseases such as diabetes, hyperlipidemia and obesity, as well as liver diseases such as hepatitis and primary liver cancer. Metabasis has developed several proprietary technologies for use in discovering and optimizing drugs, including the NuMimetic(TM) and HepDirect(R) technologies. Metabasis is continuing to identify and develop new product candidates using its proprietary technologies and expertise.

Forward-looking statements:

Statements in this press release that are not strictly historical in nature constitute "forward-looking statements." Such statements include, but are not limited to, those regarding the potential advantages of using the Quantum Mechanics-Based FEP Methodology in Metabasis' drug design efforts. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause Metabasis' actual results to be materially different from historical results or from any results expressed or implied by such forward-looking statements. These factors include, but are not limited to, difficulties or delays in development, testing, obtaining regulatory approval, producing and marketing Metabasis' product candidates; the scope and validity of intellectual property protection for Metabasis' product candidates, proprietary technologies and their uses; and other factors discussed in the "Risk Factors" section of Metabasis' Annual Report on Form 10-K for the year ended December 31, 2006 and in Metabasis' other filings with the Securities and Exchange Commission. All forward-looking statements are qualified in their entirety by this cautionary statement. Metabasis is providing this information as of this date of this release and does not undertake any obligation to update any forward-looking statements contained in this release as a result of new information, future events or otherwise.

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