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              First 
                Cohort Dosing Completed in Clinical Trial of HCV Polymerase Inhibitor 
                ANA598
 
                
                 
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                        | SUMMARY: 
                          Anadys Pharmaceuticals announced this month that investigators 
                          have completed dosing for the first patient cohort in 
                          an ongoing Phase 2 clinical trial of ANA598, 
                          the company's experimental non-nucleoside hepatitis 
                          C virus (HCV) polymerase inhibitor. The study is testing 
                          2 different doses of ANA598 in combination with pegylated 
                          interferon plus ribavirin in previously untreated genotype 
                          1 chronic hepatitis C patients. |  |  |  |   
                  |  |  |  |  |  |  Below 
                is an excerpt from a company press release describing the trial 
                status. 
                 
                  |  
                      Anadys 
                        Pharmaceuticals Provides Progress Update on Phase II Study of ANA598 in Hepatitis C Patients
  
                       ANA598 dosing completed in the 200 mg bid cohort 
 
  Enrollment completed in the 400 mg bid cohort San 
                      Diego, CA -- January 22, 2010 -- Anadys Pharmaceuticals, 
                      Inc. (Nasdaq: ANDS) today announced that ANA598 dosing has 
                      been completed in the first dose cohort, 200 mg bid [twice 
                      daily], in an ongoing Phase II study of ANA598 in combination 
                      with pegylated interferon and ribavirin (SOC) in HCV patients. 
                      Anadys expects to receive 12-week safety and antiviral response 
                      data for the 200 mg bid cohort in the first quarter of 2010. 
                      Anadys also announced that all patients have commenced dosing 
                      in the second dose cohort, 400 mg bid. With patient enrollment 
                      in this cohort completed, Anadys has accelerated the expected 
                      timing to receive 4-week safety and antiviral response at 
                      400 mg bid to the end of the first quarter of 2010 and continues 
                      to expect 12-week safety and antiviral response data in 
                      the second quarter of 2010. 
 "We are very pleased with the rapid progress of this 
                      study and appreciate the commitment of everyone involved 
                      in the trial," said Steve Worland, PhD, President and 
                      Chief Executive Officer of Anadys. "With continuing 
                      positive data, we hope to see ANA598 established as the 
                      leading non-nucleoside in HCV, suitable for combination 
                      with current standard of care as well as with other direct 
                      antivirals currently in development."
 
 Phase II Combination Study
 
 Anadys recently reported positive initial antiviral response 
                      and safety results from the 200 mg bid dose cohort based 
                      on a planned interim analysis of data at four weeks. In 
                      the group receiving ANA598 added to SOC, there was a steady 
                      increase in the percentage of patients with undetectable 
                      levels of virus from week 1 through week 4, with 56% of 
                      patients achieving undetectable levels of virus at week 
                      4 (defined as Rapid Virological Response or RVR), compared 
                      to 20% of patients receiving placebo plus SOC achieving 
                      an RVR. No patient receiving ANA598 experienced viral rebound 
                      (defined as >1 log(10) increase from a prior measurement) 
                      through week 4. ANA598 also demonstrated a favorable safety 
                      profile through four weeks. There were no serious adverse 
                      events reported and the profile of adverse events reported 
                      was as expected for patients receiving SOC alone, with comparable 
                      rates observed between the ANA598 and placebo arms.
 
 In the ongoing Phase II study, treatment-naive genotype 
                      1 patients are to receive ANA598 or placebo in combination 
                      with Pegasys (peginterferon alfa-2a) and Copegus (ribavirin, 
                      USP) for 12 weeks at dose levels of 200 mg or 400 mg both 
                      given twice daily (bid), each with a loading dose of 800 
                      mg bid on day one. After week 12, patients are to continue 
                      receiving SOC alone. Patients who achieve undetectable levels 
                      of virus at weeks 4 and 12 will be randomized to stop all 
                      treatment at week 24 or 48. The primary endpoint of the 
                      study is the proportion of patients who achieve undetectable 
                      levels of virus at week 12 (defined as complete Early Virological 
                      Response, or cEVR). Additional endpoints include safety 
                      and tolerability as well as the proportion of patients with 
                      undetectable levels of virus at week 4 (defined as Rapid 
                      Virological Response, or RVR). Patients will be followed 
                      for 24 weeks after stopping therapy to determine the rate 
                      of Sustained Virological Response, or SVR. Approximately 
                      90 patients are planned to be enrolled in this study -- 
                      with approximately 30 patients receiving ANA598 and 15 receiving 
                      placebo at each dose level. The study is being managed by 
                      the Duke Clinical Research Institute (DCRI) under the leadership 
                      of John McHutchison, MD, and is being conducted at a number 
                      of clinical sites in the United States.
 
 About ANA598
 
 ANA598 is a non-nucleoside inhibitor of the HCV RNA polymerase 
                      and is wholly owned by Anadys. In a Phase I study in HCV 
                      patients, ANA598 demonstrated potent antiviral activity 
                      when dosed as monotherapy over three days. Anadys has also 
                      completed two long-term chronic toxicology studies of ANA598 
                      (26 weeks duration in rats and 39 weeks duration in monkeys). 
                      The No Observed Adverse Effect Level, or NOAEL, is 1000 
                      mg/kg, the highest dose tested, in both the rat and monkey. 
                      The completed toxicology studies support the ongoing Phase 
                      II clinical study as well as future clinical studies of 
                      longer duration.
 
 Anadys has presented in vitro data supporting the use of 
                      ANA598 in combination with interferon-alpha as well as with 
                      direct antivirals currently in development. In particular, 
                      data has shown that ANA598 is synergistic in vitro with 
                      interferon-alpha as well as representative HCV protease 
                      and polymerase inhibitors. In vitro combination treatment 
                      at clinically relevant concentrations of interferon-alpha 
                      and ANA598 results in clearance of HCV RNA from cells rather 
                      than selection of resistant isolates. Furthermore, ANA598 
                      retains full activity in vitro against mutations conferring 
                      resistance to protease inhibitors, nucleoside polymerase 
                      inhibitors and non-nucleoside polymerase inhibitors that 
                      act at binding sites distinct from that of ANA598, and protease 
                      and nucleoside polymerase inhibitors retain full activity 
                      in vitro against mutations conferring resistance to ANA598.
 
 ANA598 has received Fast Track Status from the FDA for the 
                      treatment of chronic hepatitis C.
 
 For more information about Anadys, see www.anadyspharma.com.
 |  2/2/10 SourceAnadys 
                Pharmaceuticals. Anadys Pharmaceuticals Provides Progress Update 
                on Phase II Study of ANA598 in Hepatitis C Patients. Press release. 
                January 22, 2010.
 
 
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