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Executive Summary

MARION MERRELL DOW EXTENDS GENSIA ARA RESEARCH AGREEMENT for two more years with another $ 5 mil. in funding support, San Diego-based Gensia announced Oct. 10. Under the original agreement, announced in January 1990, MMD gained exclusive licensing rights for three years to any of Gensia's orally- available purine or pyrimidine adenosine regulating agents (ARAs) for cardiovascular and cerebrovascular diseases ("The Pink Sheet" Feb. 12, 1990, T&G-5). Concurrent with that agreement, MMD acquired 17% of then privately-held Gensia with an investment of $ 15 mil. Gensia went public in June 1990, which diluted MMD's beneficial ownership to around 14%. A secondary offering in early 1991 further diluted MMD's stake to approximately 12%. Under the extended agreement, MMD's latest $ 5 mil. investment will be worth an additional 467,057 new Gensia shares at $ 10.70 per share. MMD's stake in Gensia will increase to approximately 14%, or about 2.2 mil. of the 15.7 mil. shares outstanding. The price per share under the option exercise was agreed to in the January 1990 pact. MMD in August 1991 exercised the option to begin preclinical development of Gensia's GP-1-468-3 compound. Gensia received an undisclosed option payment for the compound and will get future payments if MMD continues to develop the compound. Gensia says the compound in preclinicals has exhibited the "cardioprotective qualities" of the company's lead compound Arasine (acadesine, AR-100) "but appears to be more potent and orally bioavailable." Arasine is in Phase III study to see if the drug can reduce cardiac tissue damage during coronary artery bypass surgery. Gensia expects to complete enrollment in the trial by the first quarter of 1992 and is forecasting a third quarter 1992 NDA filing for the product. Under the technology option and licensing agreement, MMD has the responsibility for clinical development, regulatory filings and marketing of orally-available compounds. Gensia is responsible for basic research and preclinical development. MMD not only has exclusive licensing rights to Gensia ARA compounds in the U.S., western Europe and elsewhere, but also copromotion rights to any parenteral-only (non-oral) Gensia purine or pyrimidine compound for cardiovascular and cerebrovascular disease.

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