Myotec Therapeutics Completes Merger with Hybrid BioSystems to Form PsiOxus Therapeutics

New, Combined Biotechnology Company Focused on Developing Novel Treatments for Cancer and Wasting Diseases

LONDON--(BUSINESS WIRE)--Myotec Therapeutics, Ltd. (Myotec) and Hybrid BioSystems, Ltd. (Hybrid) today announced their merger to form PsiOxus Therapeutics, Ltd. (PsiOxus), a new, development stage biotechnology company using non-traditional approaches to novel therapeutics for cancer and wasting diseases. PsiOxus, which will be led by CEO Dr. John Beadle, boasts a combined pipeline of phase I and II clinical stage assets. This pipeline will be supported with an additional financing round of £3.6 million ($5.8 million), led by Imperial Innovations and with participation from all of the major investors from both of the merged predecessor companies.

PsiOxus' lead candidate is MT-102, a dual action Anabolic Catabolic Transforming Agent (ACTA) in phase II clinical development for the treatment of cachexia, a wasting disease that is the direct cause of death in 20 to 40 percent of all cancer patients. MT-102 is also in development for sarcopenia, the age related loss of muscle mass and strength that affects one in five people by age 60. The human safety profile of MT-102 has been demonstrated in two phase I/II clinical studies, and the efficacy profile has been demonstrated in preclinical studies. The Company has initiated a multinational, double blind, placebo controlled phase II clinical study, which will be reported in 2011.

PsiOxus is also developing ColoAd1, a unique oncolytic virus developed using the evolutionary principle of natural selection to generate a virus with optimal anti-cancer properties. ColoAd1 is an extremely potent anti-cancer therapeutic with high selectivity for killing cancer cells but which shows little or no activity on normal tissue. The initial indications for the phase I/II clinical studies with ColoAd1 will be in metastatic colorectal cancer and primary hepatic cellular carcinoma.

The PsiOxus research pipeline also includes the vaccine platform PolySTAR, which combines recombinant viral vectors with polymers to shield them from the immune system, and the adjuvant and immunotherapeutic platform PolyMAP, which combines polymers with synthetic adjuvants to significantly enhance the effectiveness of vaccines.

In conjunction with the merger, PsiOxus completed a £3.6 million ($5.8 million) financing with the participation of all major investors of both predecessor companies, including Imperial Innovations, Invesco Perpetual, and the Mercia Fund. Hybrid directors Mark Payton (Mercia Fund) and Phil L'Huillier (Cancer Research Technology, Ltd.) join the PsiOxus board, together with Charles Swingland as an independent director. Proceeds from the financing will be used to advance MT-102 and ColoAd1 through phase I and II clinical development, and to develop new drug candidates derived from the PsiOxus platform technologies. The major shareholders of PsiOxus include Imperial Innovations, Invesco Perpetual, Mercia Fund, Cancer Research Technology and the University of Birmingham.

Dr Michael Moore, Chairman of PsiOxus commented:

"Through this combination, under the accomplished leadership of our Chief Executive John Beadle, we have brought together all of the key elements for a successful therapeutic development company, including talented teams with world-leading scientists, complementary technology platforms and experienced investors. As a combined entity, we have the clinical trials expertise among our scientific founders to develop promising new therapeutics to treat cancer and other serious diseases. We now look forward to advancing this product pipeline through the clinical stages ahead."

Susan Searle, Imperial Innovations Chief Executive, said:

"PsiOxus Therapeutics represents a rare opportunity to combine extensive clinical trials experience, world-class science and emerging technologies under a single, unified management team. We are pleased to be able to provide the team with the support and finances needed to expedite the clinical stage programmes and the research platforms toward commercialization."

About PsiOxus Therapeutics, Ltd.

PsiOxus Therapeutics is a development stage biotechnology company using non-traditional approaches to develop novel therapeutics that address cancer and other clinically unmet diseases. The Company's lead candidate is MT-102, a dual action Anabolic Catabolic Transforming Agent (ACTA) in phase II clinical development for the treatment of cachexia and sarcopenia. ColoAd1, an oncolytic virus for the systemic treatment of metastatic cancer, has demonstrated optimal anti-cancer properties in late pre-clinical development. The Company is also developing treatments based upon the research phase vaccine platform PolySTAR, which combines recombinant viral vectors with polymers to shield them from the immune system, and the research phase adjuvant and immunotherapeutic platform PolyMAP, which combines polymers with synthetic adjuvants to significantly enhance the effectiveness of vaccines.

Dr John Beadle, will be CEO of PsiOxus. Dr Beadle was previously a co-founder of PowderMed, which was sold to Pfizer, Inc. for more than $300 million in 2006. Dr Michael Moore, the former CEO of Piramed, which was acquired by Roche in 2008 will serve as Chairman of the Board of Directors.

PsiOxus is advised by a distinguished Scientific Advisory Board including original Myotec scientific founders , Prof Andrew Coats (Norwich Research Park Professor-at-Large, University of East Anglia) and Prof. Stefan Anker (Professor of Cardiology and Cachexia Research at Charité Medical School, Berlin and President of the Society on Sarcopenia, Cachexia and Wasting Diseases); and original Hybrid founders, Prof Len Seymour (Chair of Gene Medicine at Oxford University and Secretary General of the European Society for Gene and Stem Cell Therapy) and Dr Kerry Fisher (an internationally-recognized specialist in molecular medicine, also of Oxford University).