Maxygen Submits Proposal to BARDA for Development of MAXY-G34 for Acute Radiation Syndrome

REDWOOD CITY, Calif.--(BUSINESS WIRE)--Maxygen, Inc. (Nasdaq:MAXY) today announced that it has submitted a proposal to the Biomedical Advanced Research and Development Authority (BARDA) for a multi-year, multi-million dollar contract for the development of its MAXY-G34 product candidate as a potential medical countermeasure for Acute Radiation Syndrome (ARS). ARS results from exposure to high doses of ionizing radiation, such as from a nuclear explosion, improvised nuclear device detonation or radiation leak from a nuclear power facility. The hematopoietic sub-syndrome of ARS is characterized by the onset of severe neutropenia, which in combination with gastrointestinal and skin damage can lead to opportunistic infections and death.

“Management’s Discussion and Analysis of Financial Condition and Results of Operations”

Maxygen’s proposal is in response to a Broad Agency Announcement (BAA-10-100-SOL-00012) under which BARDA seeks to fund the advanced research and development of potential treatments for the sub-syndromes associated with ARS, including neutropenia. In preclinical studies, MAXY-G34 significantly improved survival in lethally irradiated mice. In a previously completed Phase IIa clinical trial in breast cancer patients, MAXY-G34 was safe and effective in reducing chemotherapy-induced neutropenia. Maxygen expects to receive a proposal response from BARDA in the second half of 2011.

About MAXY-G34

Maxygen’s MAXY-G34 product candidate has been designed to be an improved next-generation pegylated, granulocyte colony stimulating factor, or G-CSF, for the treatment of chemotherapy-induced neutropenia. G-CSF is a natural protein that functions by stimulating the body’s bone marrow to produce more white blood cells. G-CSF products such as MAXY-G34 may also have potential application in the treatment of ARS.

Neutropenia is a severe decrease in neutrophil cell counts in the blood. Neutropenia is a common side effect of chemotherapeutic treatments for many forms of cancer, including breast cancer, lung cancer, lymphomas and leukemias. Neutropenic patients are at increased risk of contracting bacterial infections, some of which can be life threatening. Further, and most importantly, neutropenic patients may receive reduced or delayed chemotherapy treatment, which can result in cancer progression.

Maxygen continues to retain all rights to the MAXY-G34 program for commercial development of all therapeutic areas, including chemotherapy-induced neutropenia and ARS indications, and continues to evaluate the potential further development of the program for both indications.

About Maxygen

Maxygen is a biopharmaceutical company focused on developing improved versions of protein drugs through internal development and external collaborations and other arrangements. Maxygen operates substantially all of its research and development operations through Perseid Therapeutics LLC, or Perseid, a majority-owned subsidiary established in September 2009 in connection with a joint venture arrangement with Astellas Pharma Inc. In March 2011, Astellas exercised its option to purchase all of Maxygen’s interests in Perseid for $76.0 million and the consummation of this transaction is currently pending. In addition to the MAXY-G34 program, Maxygen held approximately $102.3 million in cash, cash equivalents and marketable securities as of December 31, 2010 (excluding the $25.7 million that was held by Perseid as of such date) and remains eligible for a milestone payment of up to $30.0 million from Bayer HealthCare LLC related to the sale of hematology assets to Bayer in July 2008. For more information, please visit www.maxygen.com.

Cautionary Statement Regarding Maxygen Forward-Looking Statements

This document contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on the current expectations and beliefs of Maxygen’s management and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The following factors and uncertainties, among others, could cause actual results to differ materially from those described in the forward-looking statements: whether Maxygen will be awarded a contract under BAA-10-100-SOL-00012 or any similar solicitations and the timing, status and terms of any proposal response from BARDA or potential contract award; if Maxygen is awarded a contract, whether it can satisfy any of the conditions of such contract or begin to receive any proceeds from any such contract within any specific period of time; Maxygen’s ability or plans to commence or continue the development of MAXY-G34 for any indication and the timing and status of any such development; the potential utility of MAXY-G34 for the treatment of ARS and/or chemotherapy-induced neutropenia; the potential potency or advantages of such product over existing or future products; risks inherent in drug development; unexpected funding delays and/or reductions or elimination of BARDA funding under BAA-10-100-SOL-00012 or similar solicitations; the award of government contracts to Maxygen’s competitors; the ability of Maxygen and Astellas to consummate the acquisition of Perseid by Astellas; whether Maxygen will receive any portion of the milestone payment from Bayer; and economic, business, competitive, and/or regulatory factors affecting the business of Maxygen and the markets it serves generally, including those set forth in Maxygen’s most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q, especially in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections, and its Current Reports on Form 8-K and other SEC filings. These statements are not guarantees of future performance, involve certain risks, uncertainties and assumptions that are difficult to predict, and are based upon assumptions as to future events that may not prove accurate. Therefore, actual outcomes and results may differ materially from what is expressed herein. In any forward-looking statement in which Maxygen expresses an expectation or belief as to future results, such expectation or belief is expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the statement or expectation or belief will result or be achieved or accomplished. Maxygen is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of new information, future events, or otherwise.