KaloBios Initiates Phase 2 Study with KB003 Humaneered™ Monoclonal Antibody in Severe Asthma

KaloBios Initiates Phase 2 Study with KB003 Humaneered™ Monoclonal Antibody in Severe Asthma

KaloBios Pharmaceuticals, Inc.Jeffrey H. CooperChief Financial Officer650-243-3100orKureczka/Martin AssociatesJoan E. Kureczka415-821-2413

KaloBios Pharmaceuticals, Inc. today announced that dosing has begun in a randomized, double-blind, placebo-controlled Phase 2 clinical trial of KB003, the company’s anti-GM-CSF Humaneered™ monoclonal antibody, in subjects with severe asthma uncontrolled by corticosteroids.

The multi-center study will enroll approximately 150 subjects at sites throughout the United States, Europe and Australia. Subjects will be dosed with KB003 or placebo in addition to current therapy for 5 months. The primary endpoint for the study is the change in mean pre-bronchodilator forced expiratory volume (FEV) from baseline, a marker of airway obstruction. Secondary endpoints include asthma exacerbation rate and the degree of asthma symptom control. KaloBios expects to complete the study in Q1 2014.

“KB003 is a potent inhibitor of GM-CSF, a cytokine thought to be central to the inflammatory response that activates immune cells believed to play a key role in the two main phenotypes of asthma, allergic and non-allergic,” said Néstor A. Molfino, M.D., KaloBios’ Chief Medical Officer. “Results of a previous Phase 1/2 study showed this antibody to be well tolerated and non-immunogenic. We now look forward to evaluating the therapeutic potential of KB003 in a severe asthma patient population in a randomized, placebo-controlled trial with repeat dosing.”

“This clinical study is an example of our strategy of enriching patient selection for response to our therapeutic agents (patient targeted antibody therapy),” said David Pritchard, KaloBios’ Chief Executive Officer. “We hope to expand upon the activity of our anti-GM-CSF antibody seen in our previous clinical study.”

“We are targeting the severe asthma population which represents approximately 5 – 10% of the total asthma population of more than 300 million people. Severe asthma is responsible for approximately 50% of asthma hospitalization costs,” noted Mr. Pritchard.

KaloBios Pharmaceuticals, Inc. is developing a portfolio of proprietary, patient-targeted, first-in-class monoclonal antibodies (mAbs) designed to significantly improve the lives of seriously ill patients with difficult-to-treat diseases.

Currently, KaloBios has three drug development programs:

All of the company’s antibodies were generated using its proprietary Humaneered™ technology, a method that converts nonhuman antibodies (typically mouse) into recombinant antibodies that have a high binding affinity to their target and are designed for chronic therapeutic use. The company believes that antibodies produced using its Humaneered™ technology offer important clinical and economic advantages over antibodies generated by other methods in terms of high binding affinity, high manufacturing yields, and minimal to no immunogenicity (inappropriate immune response) upon repeat administration in humans.

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This release contains “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including those related to the company’s clinical development (including by Sanofi Pasteur) of KB001-A, KB003 AND KB004. Forward-looking statements reflect management’s current knowledge, assumptions, judgment and expectations regarding future performance or events. Although management believes that the expectations reflected in such statements are reasonable, they give no assurance that such expectations will prove to be correct and you should be aware that actual results could differ materially from those contained in the forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, including, but not limited to, the company’s limited cash reserves and its ability to obtain additional capital on acceptable terms, or at all, including the additional capital which will be necessary to complete the clinical trials that the company has initiated or plans to initiate; the company’s dependence on Sanofi Pasteur for the development and commercialization of KB001-A; the company’s ability to successfully complete further development of its programs; the uncertainties inherent in clinical testing; the timing, cost and uncertainty of obtaining regulatory approvals; the company’s ability to protect the company’s intellectual property; competition; changes in the regulatory landscape or the imposition of regulations that affect the company’s products; and other factors listed under “Risk Factors” in the company’s Form 10 on file with the Securities and Exchange Commission.

All forward-looking statements are expressly qualified in their entirety by this cautionary notice. You are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date of this release. The company has no obligation, and expressly disclaims any obligation to update, revise or correct any of the forward-looking statements, whether as a result of new information, future events or otherwise.