Neuromed Pharmaceuticals and Merck & Co., Inc. Announce Agreement for Novel N-type Calcium Channel Compounds

Business Wire, March 20, 2006

CONSHOHOCKEN, Pa. & WHITEHOUSE STATION, N.J. -- Neuromed Pharmaceuticals Ltd. and Merck & Co., Inc. announced today that they have signed a research collaboration and license agreement to research, develop and commercialize novel compounds for the treatment of pain and other neurological disorders, including Neuromed's lead compound, NMED-160, which is currently in Phase II development for the treatment of pain.

Under the terms of the agreement, Neuromed grants Merck an exclusive worldwide license to research, develop and commercialize NMED-160 and other compounds that selectively target the N-type calcium channel.

Under the terms of the agreement, Merck will make a $25 million initial cash payment to Neuromed. Neuromed will also receive research funding from Merck for two years as part of the collaborative research program, including the option to renew for an additional two years. Merck is responsible for all development costs and activities.

The successful development and launch of NMED-160 for an initial single indication on a worldwide basis would trigger milestone payments totaling $202 million. Milestones could increase to approximately $450 million if a further indication for NMED-160 is developed and approved and a further compound is developed and approved for two indications. Neuromed would also receive royalties on worldwide sales of NMED-160 and any additional compounds developed under this agreement. Additional milestone payments would be payable should further compounds be developed. Further financial terms were not disclosed.

Neuromed retains an option to co-promote compounds resulting from the agreement to specialist physicians in the United States. Under specific conditions, Neuromed may also retain rights to develop certain compounds for indications other than pain.

"Blocking pain signaling through the N-type calcium channel is a novel approach for the treatment of pain," said Christopher Gallen, M.D., Ph.D., President and Chief Executive Officer of Neuromed. "We believe our partnership with Merck could enable Neuromed to realize the significant potential value of our lead NMED-160 program and help us achieve our goal of developing breakthrough medicines for pain, a major unmet medical need, as well as other neurological disorders."

"Neuromed is extremely pleased to partner with Merck and to have the opportunity to work with their scientific team. Their outstanding research, clinical development and marketing capabilities were significant factors in choosing Merck as a partner of choice," Dr. Gallen added.

"We are pleased to enter into this agreement with Neuromed, a leader in the quest for orally active, small molecule blockers of the N-type calcium channel. This partnership complements the considerable internal research taking place at Merck to develop much-needed new medicines for pain," said Dennis W. Choi, M.D., Ph.D., Executive Vice President, Neurosciences at Merck Research Laboratories. "We look forward to joining forces with Neuromed and hope that together, we will lead the field to a new generation of pain killers."

About Neuromed Pharmaceuticals

Neuromed is a private biopharmaceutical company committed to developing a new generation of chronic pain drugs. It is the only company in the world with a sole focus on target-specific calcium channel drugs. Launched in 1998, Neuromed has strong financial backing with cumulative venture capital financing of US$74 million, outstanding research and development capabilities, and a first-in-class lead candidate in clinical trials. Neuromed's drug development programs across several different types of calcium channels are designed around validated clinical targets associated with large unmet markets including pain, cardiovascular disease and epilepsy. Neuromed is a spin-off biotechnology company from the University of British Columbia founded by Neuromed Chief Scientific Officer, Dr. Terrance Snutch. For more information on Neuromed please visit www.neuromed.com

About Merck & Co., Inc.

Merck & Co., Inc. is a global research-driven pharmaceutical company dedicated to putting patients first. Established in 1891, Merck currently discovers, develops, manufactures and markets vaccines and medicines to address unmet medical needs. The Company devotes extensive efforts to increase access to medicines through far-reaching programs that not only donate Merck medicines but help deliver them to the people who need them. Merck also publishes unbiased health information as a not-for-profit service. For more information, visit www.merck.com.

Merck Forward-Looking Statement

This press release contains "forward-looking statements" as that term is defined in the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and involve risks and uncertainties, which may cause results to differ materially from those set forth in the statements. The forward-looking statements may include statements regarding product development, product potential or financial performance. No forward-looking statement can be guaranteed, and actual results may differ materially from those projected. Merck undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events, or otherwise. Forward-looking statements in this press release should be evaluated together with the many uncertainties that affect Merck's business, particularly those mentioned in the cautionary statements in Item 1 of Merck's Form 10-K for the year ended Dec. 31, 2005, and in its periodic reports on Form 10-Q and Form 8-K, which the company incorporates by reference.