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Coley Pharmaceutical Group Diversifies Pipeline with First-in-Class TLR Antagonist for the Treatment of Systemic Lupus Erythematosus

-- CPG 52364, Coley's First Orally-Available, Small Molecule Drug

Candidate, Enters Phase I Clinical Development --

WELLESLEY, Mass., Oct. 29 /PRNewswire-FirstCall/ -- Coley Pharmaceutical Group, Inc. (Nasdaq: COLY), today announced that it has dosed its first subject in a Phase I safety study of its novel, orally-available TLR Therapeutic(TM) drug candidate for the treatment of Systemic Lupus Erythematosus, or SLE. The candidate, CPG 52364, is a small molecule Toll- Like Receptor (TLR) antagonist designed to specifically inhibit TLRs 7, 8 and 9 and inhibit disease development in SLE and other autoimmune disorders. CPG 52364 has been designed to interfere at an early stage of the immune cascade by blocking the inappropriate immune activation of all three of these TLRs, and to treat the underlying cause of the disease without causing general suppression of immune function.

The Phase I study is a double-blind, placebo-controlled, randomized clinical trial designed to examine the safety, tolerability and pharmacokinetics of ascending doses of CPG 52364. The compound will be administered as a single oral dose in approximately 40 healthy volunteers.

"Coley is committed to innovation in TLR Therapeutic drug development, and we are pleased to have furthered our objective of pipeline diversification by advancing this first-in-class TLR antagonist compound into the clinic," commented Robert L. Bratzler, Ph.D., President and Chief Executive Officer of Coley Pharmaceutical Group. "We believe there is solid preclinical evidence and strong scientific rationale that validate CPG 52364 for the treatment of SLE, and potentially other autoimmune diseases, such as rheumatoid arthritis (RA) and psoriasis, where TLRs 7, 8 and 9 are inappropriately activated. As with our other clinical efforts, we are hopeful that we can make a contribution to medicine with a new potential therapy for a disease that today remains a large unmet medical need."

CPG 52364's Mechanism of Action in SLE

The defining characteristic of SLE is the production of autoantibodies, abnormal antibodies produced against the body's own tissues or organs. In SLE, these autoantibodies bind to DNA and/or RNA, and their associated cellular proteins, forming "immune complexes". Immune complexes containing anti-DNA antibodies activate TLR9, while immune complexes that contain RNA activate TLR7 and TLR8.

Recent studies show that the development and progression of SLE are driven by the inappropriate activation of TLR7, TLR8 and TLR9. TLRs7 and 9 are present within B cells, which secrete high levels of interferon-alpha and contribute to disease severity. TLR8 is expressed in monocytes and other dendritic cells, which are thought to produce proinflammatory cytokines, which further contribute to disease process. Other studies have indicated that autoimmunity in rheumatoid arthritis (RA) and psoriasis also is mediated through one or more of these TLRs.

Coley evaluated and selected TLR7, 8 and 9 as important targets by elucidating the therapeutic mechanism of action for a commonly used treatment for SLE and RA. For many years, SLE and RA patients have been treated with certain antimalarial drugs as a treatment for SLE, such as hydroxychloroquine (HCQ), which was serendipitously discovered to be a moderately effective therapy for the disease. The therapeutic mechanism for HCQ in these autoimmune diseases had been unknown, until research from Coley and other scientists revealed that the compound is an antagonist of TLR9, and to a lesser extent TLRs7 and 8.

Based on the new recognition by Coley that the efficacy of HCQ appears to result from blocking TLRs 7, 8 and 9, Coley designed and developed CPG 52364 to inhibit these TLRs more effectively. In Coley's preclinical studies, CPG 52364 showed a marked increase in therapeutic potency compared to HCQ, preventing the development of anti-DNA antibodies in SLE-prone mice, while also exhibiting an improved safety profile.

In addition to its activity as a monotherapy, preclinical data showed that the combination of CPG 52364 with HCQ delivers added efficacy, suggesting that CPG 52364 could be used clinically either in combination with HCQ or as a replacement therapy for HCQ in the first-line treatment of SLE.

Coley plans to present data from its preclinical research with CPG 52364 at The 71st annual meeting of the American College of Rheumatology (ACR) at the new Boston Convention and Exhibition Center in Boston, Massachusetts. Dr. Arthur Krieg, Coley's Executive Vice President of Research and Development and Chief Scientific Officer will deliver a presentation on Friday, November 9, 2007 at 2:45pm EST, entitled, "Antimalarials are More Effective at Inhibiting Toll-Like Receptor 9 than at Inhibiting Antigen Presentation" (Presentation #1310).

Dr. Grayson Lipford, Vice President, Basic Research for Coley Pharmaceutical Group, plans to present a poster entitled, "Selective Toll-like Receptor 7/8/9 Antagonists for the Oral Treatment of Autoimmune Diseases," (Poster Board #210). The poster will be available for viewing on Saturday, November 10, 2007 from 8:00am to 4:30pm EST.

About Systemic Lupus Erythematosus (SLE)(1)

SLE is a chronic autoimmune disease that affects nearly 500,000 Americans. The disease, which is nine times more prevalent in women than men, and is also more prevalent in minorities, occurs when the immune system produces antibodies that cause inflammation, pain and damage to various tissues and organs in the body.

SLE is a leading cause of kidney disease, stroke, and premature cardiovascular disease in women of childbearing age. There is no known cure for this disease.

About Coley Pharmaceutical Group

Coley Pharmaceutical Group, Inc. is an international biopharmaceutical company, headquartered in Wellesley, Massachusetts, USA, that discovers and develops TLR Therapeutics(TM), a new class of investigational drug candidates that direct the human immune system to fight cancers, asthma and allergy, autoimmune disorders and to enhance the effectiveness of vaccines. Coley has established a pipeline of TLR Therapeutic product candidates currently advancing through clinical development either independently or with partners, and has additional product candidates in preclinical development. Coley has product development, research and license agreements with Pfizer, sanofi- aventis, GlaxoSmithKline, Merck, Novartis and the United States government. For further information on Coley Pharmaceutical Group please visit

Safe Harbor Statement

Certain statements in this news release concerning Coley's business are considered "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, the safety and tolerability of CPG 52364 for the treatment of Systemic Lupus Erythematosus (SLE); confirmation of TLR7/8/9 as a target for SLE; ; Coley's ability to enroll subjects in a Phase I clinical trial of CPG 52364; and, the timing of results of a Phase I clinical trial with CPG 52364. Any or all of the forward-looking statements in this press release may turn out to be wrong. They can be affected by inaccurate assumptions Coley might make or by known or unknown risks and uncertainties, including, but not limited to: the early stage of product development; uncertainties as to the future success of ongoing and planned clinical trials; the risk that results from early stage clinical trials may not be indicative of results in later stage trials; the unproven safety and efficacy of products under development; intellectual property rights and litigation; competitive products; and other risks identified in Coley's filings with the Securities and Exchange Commission including, but not limited to, Coley's Annual Report on Form 10-K for the fiscal year ended December 31, 2006. Consequently, no forward-looking statement can be guaranteed, and actual results may vary materially. Coley undertakes no obligation to publicly update forward-looking statements, whether because of new information, future events or otherwise, except as required by applicable law.

(1) Lupus Foundation of America, Inc., 2007

SOURCE Coley Pharmaceutical Group, Inc.
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