ZymoGenetics Announces Workforce Reduction and Restructuring

SEATTLE--(Business Wire)--
ZymoGenetics, Inc. (NASDAQ:ZGEN) announced today a reduction in its workforce of
approximately 32 percent, or 161 employees, as part of a corporate
restructuring. ZymoGenetics is reorganizing its operations to focus resources on
assets with the potential to generate the greatest value for shareholders. The
company expects to realize an annual reduction in operating expenses of
approximately $30 million beginning in the third quarter as a result of these
actions.

"We`re taking steps to reduce our costs, align our spending with our highest
corporate priorities and conserve our financial resources," said Douglas E.
Williams, chief executive officer of ZymoGenetics. "While it is very difficult
taking these actions, they are necessary given challenging market conditions and
the changing focus of our business plan. Going forward, we believe that
ZymoGenetics will be a stronger, more sustainable company with substantially
reduced dependence on the capital markets for funding. We appreciate the
significant contributions made by all of our employees, including those
departing, toward the company`s progress to date and in support of our plan to
build a valuable and sustainable business."

ZymoGenetics will continue to build the market for its approved product,
RECOTHROM® Thrombin, topical (Recombinant), while pursuing the research,
development and commercialization of novel biologic therapeutics. The company
will discontinue ongoing research activities in oncology and focus future
research efforts in immunology, its core strength. Collaborative transactions
will receive greater emphasis to facilitate the development and
commercialization of the company`s product candidates, while retaining
significant rights to participate in downstream value generation. The recently
announced transaction with Bristol-Myers Squibb for PEG-Interferon lambda serves
as a model for this strategy. The company is reducing its internal product
development infrastructure related to this shift in strategy, and will pursue
increased outsourcing in the future. Headcount has been reduced in most areas of
the company, with the greatest impact coming in research, manufacturing and
other development-related functions, as well as administrative departments.
Resource commitments to RECOTHROM commercial activities and PEG-Interferon
lambda development have been maintained, consistent with the company`s value
generation strategy.

The company will record a charge in the second quarter of approximately $8.5
million for severance and other costs related to the workforce reduction.

About ZymoGenetics

ZymoGenetics creates novel protein drugs that help patients fight disease. The
company developed and markets RECOTHROM® Thrombin, topical (Recombinant). Other
product candidates are focused on 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.

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 performance and the timing and outcome of actions and events may differ
materially from those expressed in or implied by the forward-looking statements
because of risks and uncertainties associated with, among other things, the
timing of actions relating to the restructuring and related events, the success
of our restructuring, our assumptions and projections relating to the
restructuring, our unproven clinical development and results, efforts in and
results of collaborations, regulatory oversight and approvals, product sales and
marketing abilities, intellectual property claims and litigation and other risks
detailed in ZymoGenetics' public filings with the Securities and Exchange
Commission, including ZymoGenetics' Annual Report on Form 10-K for the year
ended December 31, 2008.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.

ZymoGenetics, Inc.
Susan W. Specht
Director, Corporate Communications
206-442-6592

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