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Pharmasset Reports Preliminary Results of a 4-week Proof-of-Concept Combination Study of R7128 for the Treatment of Chronic Hepatitis C in Genotype 2 or 3 Non-Responders
Date:9/8/2008

- 90% of genotype 2 or 3 patients achieve undetectable HCV RNA levels following 4 weeks of treatment with R7128 1500mg BID with Pegasys(R) plus

Copegus(R) - - Safety and tolerability comparable to placebo administered with Pegasys

plus Copegus -

PRINCETON, N.J., Sept. 8 /PRNewswire-FirstCall/ -- Pharmasset, Inc. (Nasdaq: VRUS) announces the preliminary results of the fourth cohort of a 4-week Phase 1 proof-of-concept clinical trial evaluating R7128 1500mg twice daily (BID) in combination with the standard of care (SOC), Pegasys(R) (pegylated interferon) plus Copegus(R) (ribavirin) in 20 patients chronically infected with hepatitis C virus (HCV) genotype 2 or 3 who had not achieved a Sustained Viral Response (SVR) with prior SOC therapy. R7128, a prodrug of PSI-6130, is a nucleoside analogue polymerase inhibitor of HCV that is being developed through Pharmasset's collaboration with Roche.

In this study, preliminary results indicated that R7128 demonstrated significant short-term antiviral activity in patients who were previous non-responders or relapsers to treatment and was generally safe and well tolerated. Of the 25 patients enrolled, 20 patients received R7128 1500mg BID and 5 received placebo. Patients receiving R7128 1500mg BID with SOC for 4 weeks achieved a mean 5.0 log10 HCV RNA decline and 90% (18 of 20) achieved undetectable (<15 IU/ml) HCV RNA levels (RVR). Patients receiving placebo with SOC for 4 weeks achieved a mean 3.7 log10 HCV RNA decline and 60% (3 of 5) achieved an RVR. These viral load reductions for patients with genotype 2 or 3 are similar to those reported earlier for patients with genotype 1 treated with 1000mg BID and 1500mg BID and are consistent with the in vitro data demonstrating equal potency by R7128 against HCV genotypes 1, 2, 3 and 4.

The preliminary safety and tolerability of R7128 1500mg BID with SOC was comparable to placebo with SOC in Cohort 4.

Dr. Michelle Berrey, Pharmasset's Chief Medical Officer stated, "In this study, R7128, in combination with SOC, has demonstrated significant antiviral activity in genotype 2 or 3 patients who had failed prior interferon-based therapy. R7128, an HCV nucleoside polymerase inhibitor, may provide better antiviral activity in these patients where the protease inhibitors and non-nucleoside polymerase inhibitors have not yet shown success. Longer-term studies of R7128 with SOC are needed to provide additional information about its potential to improve SVR rates and possibly shorten the treatment duration for genotype 2 or 3 HCV patients."

"Patients with genotype 2 or 3 represent 20-30% of the worldwide chronically infected HCV population. Up to 40% of these patients, using SOC in first line therapy for 24 weeks, do not achieve an SVR, which represents an unmet medical need that R7128 has the potential to address," stated Patrick Higgins, Pharmasset's Executive Vice President of Sales and Marketing. "R7128 is the first small molecule to demonstrate significant antiviral activity in humans against a broad spectrum of HCV genotypes. If this early evidence of competitive advantage is sustained in future development, this potentially means that R7128 could become the preferred direct-acting antiviral to be added to the SOC because it is equally active across all of the most common genotypes and has a high barrier to drug resistance."

R7128 4-week Combination Study Overview

The 4-week Phase 1 combination clinical trial was a multiple center, observer-blinded, randomized and placebo-controlled study that was conducted in 81 treatment-naive patients chronically infected with HCV genotype 1 and 25 prior treatment non-responder patients chronically infected with HCV genotype 2 or 3. The primary objective was to assess the safety, tolerability, pharmacokinetics and antiviral activity of R7128 in the clinically-relevant setting of combination therapy for chronic HCV infection. Cohort 1 administered R7128 500mg BID, Cohort 2 administered R7128 1500mg BID, and Cohort 3 administered an intermediate dose of 1000mg BID, all given in combination with pegylated interferon and ribavirin for 28 days. All subjects then went on to receive a total of 48 weeks of the standard-of-care regimen. In Cohort 4, patients with HCV genotype 2 or 3 who did not achieve an SVR with previous interferon-based therapy were administered R7128 1500mg BID in combination with SOC for 4 weeks, and subsequently treated with an additional 20 weeks of SOC.

About R7128

R7128 is being developed for the treatment of chronic HCV infection. R7128 is a prodrug of PSI-6130, a cytidine nucleoside analog inhibitor of HCV RNA polymerase. A prodrug is a chemically modified form of a molecule designed to enhance the absorption, distribution and metabolic properties of that molecule. R7128 has shown in vitro activity against all of the most common HCV genotypes (1, 2, 3 and 4).

Results from an oral single ascending dose study of PSI-6130 in 24 healthy male volunteers showed that PSI-6130 was generally well tolerated with no serious adverse events in doses up to 3000 mg.

R7128 demonstrated significant, dose-dependent antiviral activity across four prior treatment-failure patient cohorts (n=40) receiving 750 mg or 1500 mg administered either once-daily or twice-daily for 14 days as monotherapy. The greatest mean decrease in HCV RNA from baseline was demonstrated in the patient cohort that received 1500 mg twice-daily, the highest dose of R7128 administered in the study. These patients demonstrated a mean 2.7 log10 IU/mL (>99%) decrease in HCV RNA. There was no evidence of the development of viral resistance in any dose cohort after 14 days of dosing.

In a 4-week Phase 1 combination study that was conducted in 81 treatment-naive patients chronically infected with HCV genotype 1, R7128 demonstrated significant short-term antiviral activity with safety and tolerability comparable to placebo with SOC. Results from the 500mg, 1500mg and 1000mg dose cohorts (cohorts 1, 2 and 3) in 81 treatment-naive patients chronically infected with HCV genotype 1 indicated:

Preliminary results with R7128 1000mg BID with SOC indicated patients achieved a mean 5.0 log10 IU/mL decrease in HCV RNA and 88% (22 of 25) patients achieved RVR.

Results with R7128 1500mg BID with SOC indicated patients achieved a mean 5.1 log10 IU/mL decrease in HCV RNA and 85% (17 of 20) patients achieved RVR

Results with R7128 500mg BID with SOC indicated patients achieved a mean 3.8 log10 IU/mL decrease in HCV RNA and 30% (6 of 20) patients achieved RVR.

Results with placebo with SOC indicated patients achieved a mean 2.9 log10 IU/mL decrease in HCV RNA and 18.75% (3 of 16) patients achieved RVR

About Hepatitis C

Hepatitis C is a blood-borne infectious disease of the liver and is a leading cause of chronic liver disease and liver transplants. The WHO estimates that nearly 180 million people worldwide, or approximately 3% of the world's population, are infected with HCV. The CDC has reported that almost four million people in the United States have been infected with HCV, of whom 2.7 million are chronically infected.

About Pharmasset

Pharmasset is a clinical-stage pharmaceutical company committed to discovering, developing and commercializing novel drugs to treat viral infections. Pharmasset's primary focus is on the development of oral therapeutics for the treatment of hepatitis B virus (HBV), hepatitis C virus (HCV) and human immunodeficiency virus (HIV).

Pharmasset is currently developing three product candidates. Clevudine, for the treatment of chronic HBV infection, is enrolling Phase 3 clinical trials for registration in North, Central and South America and Europe. Clevudine is already approved for HBV in South Korea and marketed by Bukwang Pharmaceuticals in South Korea under the brand name Levovir. R7128, an oral treatment for chronic HCV infection, is in a 4-week Phase 1 clinical trial in combination with Pegasys(R) plus Copegus(R) through a strategic collaboration with Roche. Racivir, which is being developed for the treatment of HIV in combination with other approved HIV drugs, has completed a Phase 2 clinical trial.

Pegasys(R) and Copegus(R) are registered trademarks of Roche.

Contact

Kurt Leutzinger

CFO

Kurt.leutzinger@pharmasset.com

Office: 609-613-4110

Forward-Looking Statements

Pharmasset "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding our business that are not historical facts are "forward-looking statements" that involve risks and uncertainties, including without limitation, the risk that the final results of the third and fourth cohorts of the 4-week Phase I clinical trial evaluating R7128 will be materially different from the preliminary results, the risk that adverse events could cause the cessation or delay of any of the ongoing or planned clinical trials and/or our development of our product candidates, the risk that the results of previously conducted studies involving our product candidates will not be repeated or observed in ongoing or future studies involving our product candidates, the risk that our collaboration with Roche will not continue or will not be successful and the risk that any one or more of our product candidates will not be successfully developed and commercialized. For a discussion of these risks and uncertainties, any of which could cause our actual results to differ from those contained in the forward-looking statements, see the section of our Annual Report on Form 10-K for the fiscal year ended September 30, 2007 filed with the Securities and Exchange Commission entitled "Risk Factors" and discussions of potential risks and uncertainties in our subsequent filings with the Securities and Exchange Commission.


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