Nucleonics Files 3rd Party Observations in Benitec's Polish Patent Prosecution; Prior Art Relevant to Pending Claims Provided

Business Wire, March 3, 2005

HORSHAM, Pa. -- Nucleonics, Inc., a biotechnology company focused on the development of novel expressed RNA interference-based (eiRNA) therapeutics, announced today that it has filed with the Polish Patent Office prior art citations that it believes relevant to the consideration of Benitec's Patent Application Number PL 343 064, entitled "Control of Gene Expression." The submission provides relevant prior art documents that Nucleonics believes render the pending claims invalid because they lack novelty and/or did not involve an inventive step at the time the patent application was filed. Nucleonics also believes that the claims are ambiguous and that the application fails to provide adequate description or sufficient working examples to support the scope of the claimed subject matter.

This challenge follows Nucleonics' previously announced September 7 and November 2, 2004 filings with The Commissioner of Patents in Australia Requesting Re-Examination of Benitec and CSIRO's Australian Patent Number 743316 and Innovation Patent Number 2001100608, both entitled "Control of Gene Expression." It also follows Nucleonics' October 4, 2004 filing with the U.S. Patent and Trademark Office of a Request for Re-Examination of Benitec and CSIRO's U.S. Patent Number 6,573,099 entitled "Genetic Constructs for Delaying or Repressing the Expression of a Target Gene" as well as the January 11, 2005 filing of 3rd Party Observations in Benitec's European Patent Application Number 99910039.9 entitled "Control of Gene Expression."

IP Australia has notified Benitec that the requests initiated by Nucleonics have led the office to state that each of the claims contained within both of Benitec's Australian Patents "are not novel and do not involve an innovative step." In addition, the U.S. Patent Office has notified Benitec that as a result of the request for re-examination filed by Nucleonics, the USPTO has determined a re-examination of each and every claim of Benitec's U.S. Patent is warranted.

"The filing of this 3rd Party Observation in Poland is a continuation of our strategy to use all available legal avenues in our Intellectual Property dispute with Benitec," said Robert Towarnicki, Nucleonics' chief executive officer.

About Expressed Interfering RNA (eiRNA)

Post-transcriptional gene silencing, also known as RNA interference or RNAi, is a phenomenon in which genes are silenced in a sequence-specific manner through targeted mRNA (messenger RNA) degradation. Researchers believe RNAi may offer potential as a novel way to silence genes involved in disease, including genes encoded by viruses such as Hepatitis B, Hepatitis C and HIV, as well as genes involved in the establishment of inflammatory diseases and cancer.

Nucleonics is licensed under the RNAi technology of Andrew Fire, Craig Mello and their colleagues, widely recognized as the seminal work in this area. Nucleonics employs an expressed interfering RNA (eiRNA) approach whereby scientists insert plasmid DNA coding for relevant double-stranded RNA (dsRNA) into targeted cells, inducing the cells to produce and deliver specific dsRNA sequences. Cellular mechanisms then cleave the dsRNA into specifically encoded siRNAs (short interfering RNA), which silence the targeted genes. Nucleonics' researchers have shown the ability of long or short dsRNA strands produced in this way to silence genes, including Hepatitis B, Hepatitis C, and HIV, in relevant cell lines for extended periods of time. Moreover, they have silenced multiple genes, as well as HBV replication, in adult mice without triggering an interferon response. Plasmid DNA approaches similar to that used by Nucleonics for expression of dsRNA have demonstrated human safety in over 500 patients to date, as part of research in the field of DNA-based vaccines. Nucleonics is initially directing its technology to the development of eiRNA therapeutics for Hepatitis B virus and Hepatitis C virus infections.

About Nucleonics, Inc.

Nucleonics, founded in January 2001, is an emerging biotechnology company focused on the development of novel RNA interference-based therapeutics for viral and other diseases. Privately owned Nucleonics is headquartered in Horsham, Pennsylvania.