AVEO and Biogen Idec Form Strategic Alliance for Development and Commercialization of ErbB3-Targeted Antibodies

Biogen Idec to Obtain Option to Commercialize ErbB3 Antibodies Outside of North America

CAMBRIDGE, Mass., March 24, 2009 – AVEO Pharmaceuticals, Inc., a biopharmaceutical company leveraging breakthrough discoveries in cancer biology to discover, develop and commercialize targeted oncology therapies, today announced a definitive agreement with Biogen Idec, Inc. (NASDAQ:BIIB), for the development and commercialization of AVEO’s novel discovery-stage ErbB3-targeted antibodies (the “ErbB3 program”) for the potential treatment of cancer and other diseases.

Under the terms of the agreement, AVEO will receive an up-front payment and is eligible to receive milestone payments based upon the achievement of specified development goals. Biogen Idec will have an option exercisable at proof of concept to development and commercialization rights to ErbB3 binding antibodies for territories outside of North America. AVEO retains all North American commercialization rights, and is responsible for leading global development of the ErbB3 program. Financial terms of the transaction were not disclosed.

“We are very pleased to enter into this alliance with Biogen Idec,” stated Tuan Ha-Ngoc, president and chief executive officer of AVEO. “This agreement for the development and commercialization of our discovery-stage ErB3-targeted antibodies facilitates our strategy to develop a balanced portfolio of small molecule drugs and antibodies for the treatment of cancer. These alliances highlight AVEO’s ability to generate value from our antibody discovery programs and advance these candidates to the clinic, reinforcing the broad potential of our rapidly maturing proprietary antibody pipeline and the quality of our science. The terms of this alliance with Biogen Idec support our strategy to become a fully-integrated company offering first- and best-in-class cancer medicines through AVEO’s own North American-based commercial organization.”

ErbB3 is a type 1 tyrosine kinase receptor of the EFGR family that is widely expressed in human carcinomas, with demonstrated overexpression – correlated with poor prognosis – in several different tumor types, including breast, ovarian, prostate, colorectal, pancreatic, gastric and head & neck cancers. In vivo studies conducted by AVEO demonstrated that elevated ErbB3 levels can potently drive breast tumor growth and may provide an escape mechanism to Herceptin® treatment. ErbB3 is also implicated in the development of resistance to EGFR tyrosine kinase inhibitors in non small cell lung cancer. AVEO has focused its ErbB3 antibody discovery efforts on identifying high affinity, high specificity antibodies that recognize ErbB3 on the cell surface and inhibit its activity. The market attractiveness of AVEO’s ErbB3 portfolio is bolstered by the success of other EFGR family inhibitors such as erlotinib, gefitinib and transtuzumab, which have unique patterns of resistance that may be addressed by an effective ErbB3 antibody.

About AVEO

AVEO is a late-stage biopharmaceutical company focused on the discovery and development of novel, targeted cancer therapeutics. AVEO’s proprietary, integrated cancer biology platform enables the company to pursue highly efficient drug development strategies in oncology that increase the probability of clinical success and provides a discovery engine for high-value targets. This approach has resulted in a balanced pipeline of novel cancer therapies focused on well-validated targets (VEGFR, EGFR) and promising novel targets (HGF, FGFR, ErbB3), as well as collaborations with Eli Lilly, Merck, OSI Pharmaceuticals, Schering-Plough and Biogen Idec. The company’s lead product, AV-951, a potential best-in-class triple VEGF receptor inhibitor, is in a Phase 2 clinical trial in patients with metastatic renal cell cancer and is expected to enter Phase 3 development in 2009. Through a combination of internal drug discovery and selective in-licensing of targeted therapeutics, AVEO is building a diversified product pipeline and moving toward its vision of becoming a fully integrated biopharmaceutical company. For more information, please visit the company's website at www.aveopharma.com.

Contacts

David Johnston, Chief Financial Officer, AVEO Pharmaceuticals, Inc.
(617) 299-5000

Sheryl Seapy, Pure Communications

(949) 608-0841