EPIX Pharmaceuticals Secures Committed Equity Financing Facility

Financing Facility May Provide Up To $50 Million of Capital
LEXINGTON, Mass.--(Business Wire)--
EPIX Pharmaceuticals, Inc. (NASDAQ:EPIX), a biopharmaceutical
company focused on discovering and developing novel therapeutics
through the use of its proprietary and highly efficient in silico drug
discovery platform, announced today that it has entered into a
Committed Equity Financing Facility (CEFF) with Kingsbridge Capital
Limited, a private investment group. Under the terms of the agreement,
Kingsbridge has committed to provide up to $50 million of capital
during the next three years through the purchase of newly issued
shares of EPIX common stock. The maximum number of shares that can be
sold by EPIX under this agreement is approximately 8.3 million shares.
EPIX will determine the exact timing and amount of any CEFF
financings, subject to certain conditions. The actual amount of funds
that can be raised under this agreement will be dependent on the
number of shares actually sold under the agreement and the market
value of EPIX stock during the pricing periods of each sale.

"This financing facility should provide EPIX with additional
access to capital as we continue to execute our Vasovist(R)
monetization and clinical development strategies," said Kim C.
Drapkin, chief financial officer of EPIX. "Based upon the agreement's
flexible terms, we will be able to draw down capital to efficiently
support our corporate and clinical initiatives. We have recently
resubmitted our New Drug Application for Vasovist, initiated our Phase
2b proof-of-concept program for PRX-03140 for the treatment of
Alzheimer's disease and expect to commence our Phase 2b trial for
PRX-08066 for the treatment of pulmonary hypertension associated with
chronic obstructive pulmonary disease. We believe these recent and
upcoming milestones illustrate our strong focus on building value
through the development of our broad clinical pipeline."

Details of EPIX's CEFF with Kingsbridge are as follows:

-- Kingsbridge is committed under the CEFF to purchase the lesser
of 8.3 million shares or $50 million of common stock from
EPIX. EPIX may access the capital for up to three years after
the Securities and Exchange Commission declares effective the
registration statement to be filed by EPIX covering the resale
of the shares of common stock issuable to Kingsbridge in
connection with the CEFF.

-- EPIX may access capital under the CEFF in tranches of up to
1.5% of EPIX's market capitalization at the time of the draw
down. Alternatively, based upon the company's prior 30-day
trading volume, EPIX may have the ability to increase each
draw down from 1.5% to up to 3% of its market capitalization
at the time of the draw down. Kingsbridge will purchase shares
of common stock pursuant to the CEFF at discounts ranging from
6% to 12% depending on the volume-weighted average market
price of the common stock during the eight-day pricing period,
provided that the minimum acceptable purchase price for any
shares to be issued to Kingsbridge during the eight-day period
is determined by the higher of $1.25 or 90% of EPIX's common
stock closing price the day before the commencement of each
draw down.

-- EPIX is not obligated to utilize any of the $50 million
available under the CEFF and there are no minimum commitments
or minimum use penalties. The CEFF agreement does not contain
any restrictions on EPIX's operating activities, automatic
pricing resets or minimum market volume restrictions.

-- The agreement does not prohibit EPIX from conducting
additional debt or equity financing, other than financings
similar to the CEFF.

-- Kingsbridge is restricted from engaging in any shorting
transaction of EPIX's common stock.

-- In connection with the CEFF, EPIX issued a warrant to
Kingsbridge to purchase up to 400,000 shares of common stock
at an exercise price of approximately $2.49 per share which
represents 125% of the average of the closing prices of the
common stock during the five trading days preceding the
agreement date. The warrant will become exercisable six months
from the date of the agreement and will remain exercisable,
subject to certain exceptions, for a period of five years
thereafter.

The warrant issued to Kingsbridge and the shares of common stock
issuable under the CEFF, and the shares issuable upon the exercise of
the warrant, have not been registered under the Securities Act, or
state securities laws, and may not be offered or sold in the United
States without being registered with the SEC or through an applicable
exemption from SEC registration requirements. EPIX has agreed to file
a registration statement with the SEC covering the resale of the
shares issuable under the CEFF and the shares issuable upon the
exercise of the warrant within 60 days of the date of the agreement.

This news release shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of any of
the securities referred to in this news release in any state in which
such offer, solicitation or sale would be unlawful prior to the
registration or qualification under the securities laws of any such
state. Any offering of EPIX common stock under the resale registration
statement referred to in this news release will be made only by means
of a prospectus.

About EPIX

EPIX Pharmaceuticals is a biopharmaceutical company focused on
discovering and developing novel therapeutics through the use of its
proprietary and highly efficient in silico drug discovery platform.
The company has a pipeline of internally-discovered drug candidates
currently in clinical development to treat diseases of the central
nervous system and lung conditions. EPIX also has collaborations with
leading organizations, including GlaxoSmithKline, Amgen, Cystic
Fibrosis Foundation Therapeutics and Bayer Schering Pharma. For more
information, please visit the company's website at www.epixpharma.com.

This news release contains express or implied forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995 that are based on current expectations of
management. These statements relate to, among other things, the
projected date for the filing of the registration statement for resale
of the shares referred to in this news release, the estimation of
funds that might be raised under the CEFF, the commencement of the
Phase 2b trial for PRX-08066, and management's plans, objectives and
strategies. These statements are neither promises nor guarantees, but
are subject to a variety of risks and uncertainties, many of which are
beyond our control, and which could cause actual results to differ
materially from those contemplated in these forward-looking
statements. In particular, the risks and uncertainties include, among
other things: risks that product candidates may fail in the clinic or
may not be successfully marketed or manufactured; risks relating to
our ability to advance the development of product candidates currently
in the pipeline or in clinical trials; failure to obtain the financial
resources to complete development of product candidates; our inability
to further identify, develop and achieve commercial success for new
products and technologies; competing products may be more successful;
our inability to interest potential partners in our technologies and
products; our inability to achieve commercial success for our products
and technologies; our inability to successfully in-license products
and/or technologies; our inability to successfully defend against
litigation; our inability to protect our intellectual property and the
cost of enforcing or defending our intellectual property rights; our
failure to comply with regulations relating to our products and
product candidates, including FDA requirements; the risk that the FDA
may interpret the results of our studies differently than we have; the
risk that we may be unable to successfully secure regulatory approval
of and market our drug candidates; and risks of new, changing and
competitive technologies and regulations in the U.S. and
internationally. Existing and prospective investors are cautioned not
to place undue reliance on these forward-looking statements, which
speak only as of the date hereof. We undertake no obligation to update
or revise the information contained in this press release, whether as
a result of new information, future events or circumstances or
otherwise. For additional information regarding these and other risks
that we face, see the disclosure contained in our filings with the
Securities and Exchange Commission, including our most recent Annual
Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q.

EPIX
Kim C. Drapkin, 781-761-7602
Chief Financial Officer
or
Pure Communications
Jennifer Beugelmans, 646-596-7473

Copyright Business Wire 2008