Monday, May 12, 2003

Genentech and XOMA Discontinue Rheumatoid Arthritis Trial

South San Francisco, Calif. -- May 12, 2003 --

Genentech, Inc. (NYSE:DNA) and XOMA Ltd. (Nasdaq: XOMA) announced today that the companies have decided to terminate Phase II testing of Raptiva™ (efalizumab) in patients with moderate-to-severe rheumatoid arthritis (RA) based on an evaluation that suggested no overall net clinical benefit in patients receiving the study drug. This decision followed an evaluation by an independent Data Safety Monitoring Board (DSMB) that was charged with evaluating the ongoing safety and efficacy data in this exploratory trial that enrolled 240 patients.

Genentech and XOMA have instructed all sites to stop enrollment and treatment of patients in both this study and a roll-over extended treatment study.

About Raptiva
As a targeted T-cell modulator, Raptiva is designed to block the activation of T-cells that cause psoriasis, without destroying them. Raptiva has been studied as a once-weekly therapy for the continuous treatment of moderate-to-severe plaque psoriasis. In clinical trials, Raptiva was administered via subcutaneous injection and in several of the trials was self-administered by some patients in their homes. In December 2002, Genentech and XOMA filed a Biologics License Application (BLA) with the U.S. Food and Drug Administration for Raptiva for the treatment of moderate-to-severe plaque psoriasis in patients 18 years or older. The BLA submission included data from over 2,100 patients treated with Raptiva.

About XOMA
XOMA develops and manufactures antibody and other protein-based biopharmaceuticals for disease targets that include immunological and inflammatory disorders, cancer and infectious diseases. XOMA's programs include collaborations with Genentech, Inc. on the Raptiva™ antibody for psoriasis (BLA submission), psoriatic arthritis (Phase II) and other indications; with Baxter Healthcare Corporation to develop NEUPREX® (rBPI21) for Crohn's disease (Phase II) and other indications; with Millennium Pharmaceuticals, Inc. on two biotherapeutic agents, CAB-2 and MLN01, for cardiovascular inflammation indications (preclinical); and with Onyx Pharmaceuticals, Inc. on its ONYX-015 product for various cancers (current activities suspended, pending partnership discussions). Earlier-stage programs focus on antibodies and BPI-derived compounds developed at XOMA for the treatment of cancer, retinopathies, and acne. For more information about XOMA's pipeline and activities, please visit XOMA's website at http://www.xoma.com.

About Genentech
Genentech is a leading biotechnology company that discovers, develops, manufactures and commercializes biotherapeutics for significant unmet medical needs. Fifteen of the currently approved biotechnology products originated from or are based on Genentech science. Genentech manufactures and commercializes ten biotechnology products directly in the United States. The company has headquarters in South San Francisco, California and is traded on the New York Stock Exchange under the symbol DNA. For press releases and additional information about the company, please visit http://www.gene.com.

Regarding XOMA:

Statements contained herein related to the regulatory process and collaborative arrangements, or that otherwise relate to future periods, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements are based on assumptions that may not prove accurate. Actual results could differ materially from those anticipated due to certain risks inherent in the biotechnology industry and for companies engaged in the development of new products in a regulated market. These risks, including those related to safety and efficacy of the products being studied; action, inaction or delay by the U.S. Food and Drug Administration or European regulators; analysis, interpretation and submission of scientific data; changes in the status of existing collaborative relationships; the ability of collaborators and other partners to meet their obligations; and market demand for products, are described in more detail in XOMA's most recent annual report on Form 10-K and in other SEC filings.