Bristol-Myers Squibb and ZymoGenetics Enter Global Collaboration on Novel Hepatitis C Compound

PEG-Interferon lambda is a Novel Type 3 Interferon in Phase Ib trials
PRINCETON, N.J. & SEATTLE--(Business Wire)--
Bristol-Myers Squibb Company (NYSE: BMY) and ZymoGenetics, Inc. (Nasdaq: ZGEN)
today announced a global collaboration for PEG-Interferon lambda, a novel type 3
interferon currently in Phase Ib development for the treatment of Hepatitis C,
and its related development program.

Under the terms of thecollaboration, Bristol-Myers Squibb agreed to pay
ZymoGenetics an upfront cash payment of $85 million for the development and
commercialization rights to PEG-Interferon lambda, and to pay an additional
license fee of $20 million in 2009. ZymoGenetics could receive additional
payments of up to $430 million based on pre-defined development and regulatory
milestones for PEG-Interferon lambda in Hepatitis C, up to $287 million in
development and regulatory milestones for other potential indications, and up to
$285 million based on pre-defined sales-based milestones.

The companies have agreed to co-develop PEG-Interferon lambda in the United
States and Europe and will share development costs. It is anticipated that
ZymoGenetics will conduct a significant portion of continuing Phase I and
certain Phase II development activities. ZymoGenetics will have the option to
co-promote in the United States and to share profits on product sales with
Bristol-Myers Squibb. ZymoGenetics may opt out of the co-development,
co-promotion and profit sharing arrangement in the United States, in which case
ZymoGenetics will receive royalties on PEG-Interferon lambda sales worldwide.

Outside the United States, Bristol-Myers Squibb will be responsible for
commercialization and ZymoGenetics will receive royalties on product sales.

"We welcome the opportunity to combine ZymoGenetics` strong foundation in
discovering and developing therapeutic proteins, with our own internal research
and development expertise in working on this innovative Hepatitis C therapy that
has the potential to help patients prevail over this serious disease," said
Francis Cuss, MD, Senior Vice President, Discovery and Exploratory Clinical
Research, Bristol-Myers Squibb. "The profile of PEG-Interferon lambda offers the
possibility of improvements in the safety and effectiveness of combination
treatment for Hepatitis C and makes it an ideal fit with our emerging portfolio
of small molecule anti-virals."

"We believe Bristol-Myers Squibb is the ideal partner for ZymoGenetics and that
we share the vision that PEG-Interferon lambda could become an important part of
treating patients with Hepatitis C," said Douglas E. Williams, Ph.D., Chief
Executive Officer of ZymoGenetics. "We look forward to a productive partnership
focused on bringing PEG-Interferon lambda to Hepatitis C patients as rapidly as
possible."

PEG-Interferon lambda (IL-29) is a novel type 3 interferon currently in Phase Ib
development for Hepatitis C. The native human protein Interferon lambda is
generated by the immune system in response to viral infection. PEG-Interferon
lambda has the potential to be uniquely differentiated from available interferon
therapy because Interferon lambda mediates anti-viral activity through a
receptor that is distinct from that used by Interferon alpha and is present on
fewer cell types within the tissues of the body. As a result, the possibility
exists for more targeted delivery of interferon therapy and an improved
therapeutic index.

The effectiveness of the agreement is subject to antitrust clearance by the
United States Federal Trade Commission and Department of Justice, under the
provisions of the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and other
customary regulatory approvals.

About Hepatitis C1

Hepatitis C is a virus that infects the liver and is transmitted through direct
contact with blood. An estimated 170 million people worldwide are infected with
Hepatitis C and, of these, 94.5 million people live in the Asia Pacific region.
One to five percent of people with chronic infection will develop liver cancer.
Although there is no vaccine to prevent Hepatitis C, it is a curable disease.

Conference Call and Webcast Information

ZymoGenetics will conduct a conference call/webcast on Tuesday, January 13, at
8:30 a.m. Eastern Time. The call and webcast may be accessed at
www.zymogenetics.com or by dialing 877-407-0778 (International: 201-689-8565).
Participants should dial in to the call approximately 10 minutes prior to the
scheduled start time to register. A live audio webcast and slide presentation
can be accessed by going to: www.zymogenetics.com. The webcast will be archived
for 60 days. For replay, please visit www.zymogenetics.com or use the following
information:

* U.S. callers: 877-660-6853
* International callers: 201-612-7415

Replay passcode account #: 286
Conference ID #: 309378

About Bristol-Myers Squibb

Bristol-Myers Squibb is a global biopharmaceutical company whose mission is to
extend and enhance human life. For more information visit www.bms.com.

About ZymoGenetics

ZymoGenetics creates novel protein drugs that help patients fight disease.
ZymoGenetics developed and markets RECOTHROM Thrombin, topical (Recombinant).
Other product candidates span a wide array of clinical opportunities that
include cancer, autoimmune and viral diseases. ZymoGenetics intends to
commercialize product candidates through internal development, collaborations
with partners, and out-licensing of patents from its extensive patent portfolio.
For further information, visit www.zymogenetics.com.

ZymoGenetics Forward Looking Statements

This press release contains "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995.These forward-looking
statements are based on the current intent and expectations of the management of
ZymoGenetics.These statements are not guarantees of future performance and
involve risks and uncertainties that are difficult to predict. ZymoGenetics'
actual results and the timing and outcome of events may differ materially from
those expressed in or implied by the forward-looking statements because of risks
associated with our unproven preclinical and clinical development and results,
strategic partnering, including efforts by and results of collaborations,
regulatory oversight and approvals, product sales and marketing abilities,
discovery strategy, intellectual property claims and litigation and other risks
detailed in the company's public filings with the Securities and Exchange
Commission, including the company's Annual Report on Form 10-K for the year
ended December 31, 2007. Except as required by law, ZymoGenetics undertakes no
obligation to update any forward-looking or other statements in this press
release, whether as a result of new information, future events or otherwise.

Bristol-Myers Squibb Forward-Looking Statements

This press release contains "forward-looking statements" as that term is defined
in the Private Securities Litigation Reform Act of 1995, regarding the research,
development and commercialization of pharmaceutical products.Such
forward-looking statements are based on current expectations and involve
inherent risks and uncertainties, including factors that could delay, divert or
change any of them, and could cause actual outcomes and results to differ
materially from current expectations.No forward-looking statement can be
guaranteed.Among other risks, there can be no guarantee that the clinical trials
described in this release will support a regulatory filing or that the product
described in this release will receive regulatory approval.There can be no
assurance that if approved, the product will be commercially successful. Nor is
there any assurance that the transaction described in this release will receive
the necessary regulatory approvals to close. Forward-looking statements in the
press release should be evaluated together with the many uncertainties that
affect Bristol-Myers Squibb`s business, particularly those identified in the
cautionary factors discussion in Bristol-Myers Squibb`s Annual Report on Form
10-K for the year ended December 31, 2007, its Quarterly Reports on Form 10-Q,
and Current Reports on Form 8-K.Bristol-Myers Squibb undertakes no obligation to
publicly update any forward-looking statement, whether as a result of new
information, future events, or otherwise.

References

1. World Health Organization Web site. Fact sheet N°164.
http://www.who.int/mediacentre/factsheets/fs164/en/. Accessed September 23,
2008.

Bristol-Myers Squibb Company
Media:
Jennifer Fron Mauer, 609-252-6579
jennifer.mauer@bms.com
or
Investors:
John Elicker, 609-252-4611
john.elicker@bms.com
or
ZymoGenetics
Media and Investors:
Susan W. Specht 206-442-6592
spechts@zymogenetics.com
or
Media and Investors:
Michael Fitzpatrick 206-442-6702
fitzpatm@zymogenetics.com

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