September 5, 2002

Terumo Partners with US-based Diacrin
To Develop Cell Therapy for Myocardial Repair
Terumo to launch the world's first commercial cardiac repair project

TOKYO, September 5, 2002 - Terumo Corporation of Japan signed a Development and License Agreement with Diacrin, Inc., of the United States on September 4, 2002. With the agreement, Terumo receives a license to develop medical technology that will employ skeletal muscle cells to repair damaged heart tissue. Terumo Corporation is headquartered in Shibuya-ku, Tokyo (President and CEO: Takashi Wachi), while Diacrin, Inc., has its headquarters in Massachusetts.

Terumo will promote the clinical aspect of this joint development project with Diacrin through cooperation with Osaka University. Terumo plans to begin the commercial phase of its cardiac repair project in Japan in 2008, and anticipates revenues of about 10 billion yen from the project within five years of that.

1. Summary of the partnership agreement

Diacrin, Inc., will provide Terumo with licenses for medical technologies it is currently developing for cardiac repair using skeletal muscle cells. The licenses will provide access to use of patents, expertise, clinical data, etc.
Terumo will promote projects that are based on this licensing agreement, in Japan and other parts of Asia.
Both companies will collaborate in development.

2. Cardiac repair using skeletal muscle cells

Treatment of ischemic heart diseases such as acute myocardial infarction generally involves restoring blood flow to the blocked coronary artery using a device such as a balloon-tipped catheter. However, it is not uncommon for the coronary heart disease to develop into heart failure because of the dysfunction or death of heart muscle cells in the area of infarction. Heart failure leads to a progressively worsening condition, as the load on the heart increases and heart function decreases. Although, in such a case, it is possible to alleviate the symptoms through drug therapy, currently there are no available therapies for damaged heart. The only way the patient can recover is to undergo a heart transplant.

The technology to be shared under the partnership agreement is human muscle cell transplantation technology for cardiac repair which involves taking skeletal muscle cells in a patient's thigh, growing those cells in vitro, then injecting them to the area of damaged heart in a patient suffering from heart failure. Animal studies have shown skeletal muscle cells can aid in repairing the damaged heart. Diacrin is currently testing in human clinical trial in the United States. Skeletal muscle cells offer a number of advantages: they are taken from the patient's own body, thereby avoiding the problems of rejection and infection; they are subject only to muscle cell differentiation; and they can be grown in culture outside the body.

Terumo intends to isolate skeletal muscle cells that have been harvested from muscle tissue at a medical institution, cultivate and grow them in a secure environment for several weeks, prepare them for injection, then supply them in an activated state back to the medical institution. In this way, Terumo hopes to establish a business project that will promote the widespread use of this medical treatment for cardiac repair.

3. Project schedule leading to commercial operations (in Japan)

2002 Begin co-development with Diacrin, Inc.
2004 Begin clinical trials
2006 Applications to MHLW
2008 Obtain authorization and begin commercial project

For the reference: Profile of Diacrin, Inc.

President & CEO: Thomas H. Fraser, Ph.D.
Headquarters: Charlestown, Massachusetts, U.S.A.
Established: 1989
Capital: US$102 million
Listed on the Nasdaq Exchange in 1996
Business description:

Develops cell transplantation technology for the treatment of various human tissue diseases
Currently conducts clinical trials in the United States in six areas of cell therapy