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Anadys Pharmaceuticals Nominates ANA598, a Small-Molecule,,Non-Nucleoside Inhibitor of The NS5b Polymerase, as a Candidate for,Clinical Development in Chronic Hepatitis C Virus Infection

SAN DIEGO, June 20, 2007 /PRNewswire-FirstCall/ -- Anadys Pharmaceuticals, Inc. , a biopharmaceutical company committed to the discovery, development and commercialization of novel medicines for the treatment of hepatitis and cancer, announced today that it has nominated ANA598 as a candidate for clinical development as an orally-administered direct antiviral for the treatment of chronic hepatitis C virus (HCV) infection.

"We have identified a small-molecule, non-nucleoside inhibitor of the NS5b polymerase that, based on pre-clinical studies conducted to date, has shown favorable antiviral, metabolic, pharmacokinetic, and preliminary toxicologic properties, and is the culmination of several years of work in our HCV direct antiviral discovery program," said Lawrence C. Fritz, Ph.D., president and chief executive officer of Anadys. "We are now conducting additional pre-clinical studies in anticipation of submitting an Investigational New Drug application (IND) in the second quarter of 2008."

Preclinical Study Results

In a series of in vitro pre-clinical studies ANA598 demonstrated excellent potency against HCV genotype 1 NS5b polymerase and potent activity in HCV replicon assays. The compound also displayed very good in vitro metabolic stability and did not significantly inhibit human CYP enzymes, suggesting a low potential for drug-drug interactions. Extending these in vitro findings, in vivo preclinical studies of ANA598 demonstrated high oral bioavailability and good tolerability. Also, drug levels were sustained in the plasma and in the liver, the principal site of HCV replication.

"The current standard of care is inadequate for many chronic HCV patients, including about half of those with genotype 1 disease," said Steve Worland, Ph.D., president, Pharmaceuticals. "We believe ANA598 possesses favorable characteristics that may enable it to play an important role in future HCV thera py."

About Anadys

Anadys Pharmaceuticals, Inc.,, is a biopharmaceutical company committed to advancing patient care by discovering, developing and commercializing novel small molecule medicines for the treatment of viral diseases and cancer. The Company's programs focus on Toll-Like Receptor-based small molecule product candidates and direct antiviral compounds that inhibit key steps in viral proliferation. The Company has core expertise in medicinal chemistry coupled with structure-based drug design, and is developing compounds for the treatment of hepatitis C infection, hepatitis B infection and cancer.

Safe Harbor Statement

Statements in this press release that are not strictly historical in nature constitute "forward-looking statements." Such statements include, but are not limited to, references to the believed favorable antiviral, metabolic, pharmacokinetic, and preliminary toxicologic properties of ANA598, the expected timing and plans for filing an IND and the possibility that ANA598 may play an important role in future HCV therapy. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause Anadys' actual results to be materially different from historical results or from any results expressed or implied by such forward- looking statements. In particular, the results of in vitro studies and initial in vivo studies may not be predictive of future results, and Anadys cannot provide any assurances that any of its product candidates will not have unforeseen safety issues, will have favorable results in future clinical trials or will receive regulatory approval. In addition, Anadys' results may be affected by other factors. In particular, there is no guarantee that Anadys and Novartis will be able to agree on future development activities for ANA975, that the FDA will lift the clinical hold on th e ANA975 IND, or that the clinical development of ANA975 will be able to be resumed. There also is no guarantee regarding Anadys' future involvement with, or value recognition from, the ANA380 program. Anadys' results may be further affected by risks related to its collaborative relationships with Novartis and LG Life Sciences, competition from other biotechnology and pharmaceutical companies, its effectiveness at managing its financial resources, its ability to successfully develop and market products, the level of effort that its collaborative partners devote to development and commercialization of its product candidates, difficulties or delays in its pre-clinical studies or clinical trials, difficulties or delays in manufacturing its clinical trials materials, the scope and validity of patent protection for its products, regulatory developments involving future products and its ability to obtain additional funding to support its operations. Risk factors that may cause actual results to differ are more fully discussed in Anadys' SEC filings, including Anadys' Form 10-K for the year ended December 31, 2006 and the "Risk Factors" section of Anadys' Form 10-Q for the quarter ended March 31, 2007. All forward-looking statements are qualified in their entirety by this cautionary statement. Anadys is providing this information as of this date and does not undertake any obligation to update any forward-looking statements contained in this document as a result of new information, future events or otherwise.

CONTACT: Vince Reardon, Sr. Director, Investor Relations & CorporateCommunications of Anadys Pharmaceuticals, Inc., +1-858-530-3653,

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Ticker Symbol: (NASDAQ-NMS:ANDS)

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