MONOCLONAL ANTIBODY

We have a novel monoclonal antibody technology for the treatment of metastatic melanoma, a rare but deadly form of skin cancer. We own exclusive worldwide commercial rights to this technology, which we licensed from Albert Einstein College of Medicine.

In June 2008, we announced the successful completion of our first clinical study. This treatment consisted of dosing patients with the monoclonal antibody labeled with a radio-isotope. Top line results indicate this antibody binds to melanoma tumor sites.

TECHNOLOGY BACKGROUND

Historically, monoclonal antibodies have been ineffective in melanoma for technical reasons. In a new twist, a research team from Albert Einstein College of Medicine, led by Arturo Casadevall, M.D., Ph.D., Chairman of the Department of Microbiology & Immunology, and Ekaterina Dadachova, Ph.D., Associate Professor, Department of Nuclear Medicine, developed a novel approach to treat metastatic melanoma based on targeting melanin, a skin pigment that is released from dead melanotic tumor cells, with radio-labeled monoclonal antibodies. The antibodies seek out the released melanin and destroy human melanoma cells with a lethal dose of ionizing radiation, thus achieving a therapeutic effect. Melanin in normal, healthy tissue is not targeted because it is inside the cells and not accessible to the radio-labeled antibody.

The feasibility of this approach was tested in a proof-of-concept animal study that was published in Proceedings of the National Academy of Sciences (PNAS) in an article titled, Dead Cells in Melanoma Tumors Provide Abundant Antigen for Targeted Delivery of Ionizing Radiation by a mAb to Melanin (PNAS 2004, 101: 14865-14870).

Under the terms of an agreement between Pain Therapeutics and Albert Einstein College of Medicine (AECOM), AECOM was paid an undisclosed upfront fee and may receive milestone payments totaling approximately $3.5 million in the aggregate based on clinical and regulatory progress. AECOM will also receive a 4% royalty on net sales. In exchange, Pain Therapeutics received exclusive, worldwide commercial rights to all indications in oncology and infectious disease.

ABOUT METASTATIC MELANOMA

Melanoma is a deadly form of skin cancer. According to the American Cancer Society, melanoma accounts for approximately 3% of all skin cancer cases but it causes most skin cancer deaths. The number of new cases of melanoma in the United States is on the rise. The American Cancer Society estimates that in 2008 there will be 62,480 new cases of melanoma in this country. About 8,420 people will die of this disease this year. If diagnosed and surgically removed, early-stage melanoma is potentially curable. However, for patients with metastatic melanoma, the prognosis is poor, with limited available treatments. There has been little change in these results in over 25 years. The last drug to treat patients with melanoma was approved by the FDA 30 years ago.