Morphotek Announces Collaborative Agreement with Tanox to Develop High-Titer Production Cells for the Manufacturing of Therapeutic Antibodies Using Suppressor of Immunoglobulin Product (SIP) Technology

Exton, PA, June 7, 2004 -- Morphotek Inc. announced today that it has signed a collaborative research agreement with Tanox, Inc. (NASDAQ: TNOX) of Houston, TX, for the use of Morphotek's proprietary SIP Technology to develop universal high-titer mammalian cell line hosts for the commercial manufacturing of therapeutic antibody products.

Under the terms of the nonexclusive agreement, Morphotek will receive an upfront payment and research fees to support research and development efforts, research milestones upon successful achievement of program goals and royalties on sales of products that are manufactured using the Morphotek optimized cell lines.

SIP Technology is based on the suppression of two ubiquitously expressed gene products in mammalian cells called Suppressor of Immunoglobulin Product-1 (SIP-1) and Suppressor of Immunoglobulin Product-7 (SIP-7). Research has demonstrated that suppression of SIP-1 and SIP-7 in antibody producing mammalian cells can lead to enhanced antibody production. The genes were discovered by Morphotek researchers conducting comparative genomic studies of parental antibody manufacturing cell lines and high-titer derivatives developed using the company's proprietary MORPHODOMA® in vivo gene evolution technology that generates high-titer sublines from existing hybridoma and transfectoma cells. SIP Technology can rapidly generate cell lines with enhanced titer yields that are suitable for scaleable manufacturing.

"We are pleased to announce this alliance with Tanox, an industry leader in antibody therapeutics, for the generation of a universal high-titer production cell line to support the large-scale manufacturing of their products," stated Dr. Nicholas C. Nicolaides, President, Chief Executive Officer of Morphotek.

"SIP Technology is a complementary platform to our MORPHODOMA® technology that can enhance production yields within existing low-titer manufacturing cell lines", added Dr. Philip M. Sass, Executive Vice President and Chief Operating Officer of Morphotek. "We are offering these technologies and services to a number of collaborators to support their biologic manufacturing programs and to development groups in need of optimizing cell lines to generate preclinical-, clinical- or marketed-stage compounds."

Morphotek® Inc. is a biotechnology company specializing in the development of protein and antibody products through the use of a novel and proprietary gene evolution technology. The technology has been successfully applied to a broad variety of cell lines and organisms to yield genetically diverse offspring that are suitable for pharmaceutical product development in the areas of antibody therapeutics, protein therapeutics, product manufacturing, drug target discovery, and improved output traits for commercial applications. The company is currently focusing its platform on the development and manufacturing of therapeutic antibodies for the treatment of cancer, inflammation and infectious disease. For further company information visit www.morphotek.com.

Contact: Philip M. Sass, Ph.D./Morphotek, 610-423-6106, info@morphotek.com