February 19, 2003

BATTELLEPHARMA ANNOUNCES $22M PRIVATE EQUITY FINANCING

BattellePharma Media Contact:
Christy Polsley-Finch
(614) 340-2361
finch@battellepharma.com

COLUMBUS, Ohio - BattellePharma, a privately-held specialty pharmaceutical company conceived and incubated by Battelle Memorial Institute, today announced it has completed a private placement of Series B Preferred Stock for $22 million. The capital will be used to fund BattellePharma's operations through mid-2005.

TL Ventures led the funding round that included new investors Merlin BioMed Group, Fletcher Spaght Ventures, L.P., Richardson Ventures Inc., and existing investor, Battelle Memorial Institute. Representatives from TL Ventures and Merlin BioMed Group will join the BattellePharma Board of Directors. Lehman Brothers acted as exclusive placement agent on the transaction.

"This significant investment will allow us to complete the next phase of BattellePharma's development," said Chuck Bramlage, president and CEO of BattellePharma. "As a result of the new funding, we will deliver major progress of our own MysticTM asthma compound through clinical trials, as well as complete closure of the final inhalation commercial device for our partners. We are excited to have the new investment from this expanded investor base."

Marc Ostro, Ph.D., Managing Director at TL Ventures and lead investor commented, "At TL Ventures, we look to invest in companies that are well managed and are developing cutting edge products that address significant, unmet medical needs. We believe that BattellePharma satisfies these criteria and their Mystic aerosol system has the potential to transform the way drugs are delivered to the lung."

"We are proud to have helped bring BattellePharma to this point and are very encouraged by the new investment as validating our commitment to this technology," said Mark W. Kontos, CFO of Battelle Memorial Institute, the founding shareholder of BattellePharma. "This investment positions BattellePharma to make significant progress in the future in its ability to address challenging medical needs in our society."

About BattellePharma

BattellePharma is a privately-held specialty pharmaceutical company leveraging science and technology to design more effective medicines. BattellePharma's products are based on two platform technologies: Mystic inhalation technology and novel formulation technologies. The company develops products by combining these platforms with novel or generic compounds to create therapies to treat respiratory and systemic diseases. BattellePharma's Mystic technology is proving to be so versatile and effective in clinical trials, it is expected to set a new standard for inhaled drug delivery in the 21st century. BattellePharma has partnerships with numerous pharmaceutical corporations including Abbott Laboratories, Corus Pharma, GlaxoSmithKline, Pfizer Inc., Pharmacia Corporation, VIASYS Healthcare GmbH, and ViroPharma Inc. For more information on BattellePharma, reference the company's website at www.battellepharma.com.

About TL Ventures

TL Ventures is an established venture capital firm with over $1.4 billion under management. Focused on investing in category-defining, early-stage companies in information technology, communications, and biotechnology, the firm provides portfolio companies with a mix of financial, operational and entrepreneurial expertise, strategic counsel and a global network of resources and contracts. TL Ventures has offices in Philadelphia, Austin, Dallas, and Los Angeles. For more information, please visit www.tlventures.com.

About Battelle Memorial Institute

Battelle Memorial Institute, headquartered in Columbus, Ohio is a global leader in technology development and commercialization. With annual revenues of $1.2 billion, Battelle Memorial Institute has operations at more than 100 locations and clients in 30 countries. It counts as its successes the development of the office copier machine (Xerox), pioneering work on the compact disc, medical technology breakthroughs, and fiber optic advancements for telecommunications. For more information, please visit www.battelle.org.

About Merlin BioMed Group

Merlin BioMed Group is a global asset management firm focused solely on healthcare investing from late-stage private firms to large capitalization public companies. Headquartered in New York, the firm manages over $300 million in assets, making it one of the largest asset management firms dedicated to the healthcare sector. The Merlin BioMed Private Equity Fund invests in biotechnology, medical device, and healthcare services late-stage private companies.

About Fletcher Spaght Ventures, L.P.

Fletcher Spaght Ventures, L.P. (FSV) is a venture capital fund investing in emerging growth high technology and healthcare companies. Established to build substantial, long-term capital appreciation, FSV invests in companies which build upon the strategy consulting practice of Fletcher Spaght Inc., have business potential, and financing led by a top-tier venture capital firm. Of interest are companies in the areas of information technology (IT) and IT services, Internet, software, telecommunications, medical devices, healthcare informatics, biotechnology and healthcare services. FSV is located in Boston, Massachusetts. For more information, please visit www.fletcherspaght.com.

About Richardson Ventures Inc.

Richardson Ventures Inc., is a 100 percent wholly owned subsidiary of James Richardson & Sons, Limited, which was founded in Kingston, Ontario in 1857. Now headquartered in Winnipeg, Manitoba, the private, family-owned companies continue to be pioneers in a variety of businesses, including the international agri-business, oil and gas exploration, real estate and investment operations.