Arrowhead Announces License of New Nanotech Stem Cell Device from Stanford University

PASADENA, Calif.--(BUSINESS WIRE)--June 6, 2005--Arrowhead Research Corporation (NASDAQ:ARWR) announced today that it has exclusively licensed intellectual property from Stanford University for a nanotech device that controls the behavior of adult stem cells. Arrowhead will fund additional research involving the device at Stanford in exchange for the right to exclusively license and commercialize the technology.

The technology has been developed in the lab of Dr. Nick Melosh in the Materials Science Department at Stanford. The Melosh group is using arrays of nano-reservoirs on a chip to stimulate desired adult stem cell behavior. Melosh's team will conduct further research by collaborating with scientists and doctors at the Stanford Stem Cell Institute and the Lucile Packard Children's Hospital. Arrowhead has committed $600,000 to the project, with $110,000 funded upon signing and the remainder payable quarterly over the following two years.

Both embryonic and adult stem cells have the ability to become the cells of different tissues and represent a treatment for diseases such as neurological disorder, heart failure, and diabetes. Adult stem cells, which are less controversial from a political standpoint than embryonic stem cells, are less likely to generate immune reactions in patients and, therefore, could be better suited for tissue engineering than embryonic stem cells. Notwithstanding the potential of adult stem cells, however, there is no commercially available tool to enable scientists and doctors to precisely control their functions. "The solution we are pursuing is to build a device that can interact with the stem cell at the micro- and nanoscale," said Dr. Melosh. "For example, exposure to minute amounts of chemical at the appropriate time and place could be the key for guiding stem cells isolated from fat tissue to turn into cartilage or bone constructs."

"We are pleased to expand our outsourced R&D and commercialization program to Stanford," said R. Bruce Stewart, President of Arrowhead. "We believe nanotechnology is the key to unleashing the potential of stem cells. Ultimately, surgeons could use this product to grow heart tissue in the Emergency Room to replace damaged tissue resulting from a heart attack."

About Arrowhead Research Corporation

Arrowhead Research Corporation is a diversified nanotechnology company structured to commercialize products expected to have revolutionary impacts on a variety of industries including materials, electronics, life sciences, and energy.

There are three strategic components to Arrowhead's business model:

-- Outsourced R&D Program: Arrowhead identifies patented or patent pending technologies at universities or government labs and funds additional development of those technologies in exchange for exclusive rights to commercialize the resulting prototypes. Leveraging the resources and infrastructure of these institutions provides Arrowhead with a highly cost-effective development pipeline. Currently, Arrowhead is supporting efforts in stem cell technology, nanomaterials, nanoelectronics, and nanobiotools at the California Institute of Technology and Stanford University.

-- Commercialization Program: After prototypes have been sufficiently developed in the laboratories, Arrowhead forms or acquires majority-owned subsidiaries to commercialize the technology and provides the subsidiaries with strategic, managerial, and operational support. At present, Arrowhead owns majority interest in subsidiaries commercializing diverse technologies including anti-cancer drugs, RNAi therapeutics and compound semiconductor materials.

-- The Patent Toolbox: Arrowhead has acquired or exclusively licensed patents and patent applications covering a broad range of nanotechnology. The Company is actively seeking to add to this intellectual property portfolio.