The agreement includes an initial commitment to fund development of Cerus' proprietary S-59 technology for use with source plasma. Cerus initially developed its S-59 technology for platelets and plasma intended for transfusion. The agreement contemplates funding by the Consortium through the regulatory approval phase, with future commitments to be determined by the Consortium annually. The agreement provides for Cerus to pay the Consortium a royalty on potential product sales.

“Blood safety in the developed world is state of the art, and the risk for infection by transmission during transfusion has never been lower,” said Dr. Frederick Dombrose, Executive Director of the Consortium. “However, vigilance and continued improvement remain a goal because of general concern for the possible transmission of unknown or undetectable pathogens. Maintaining the safety of transfused human blood-derived products depends heavily on the dual safeguards of donor screening and pathogen testing, in combination with the plasma fractionation industry's commitment to quality assurance,” Dombrose added.

“The Consortium is a progressive organization in its active pursuit of new technologies to enhance the safety of the blood supply. This agreement will help open the door for Cerus into the significant plasma fractionation side of the blood products industry,” said Cerus president and chief executive officer Stephen Isaacs. “Strategically, the treatment of source plasma is a perfect fit for our technology. We believe we can leverage our expertise, gained from our work in developing the S-59 technology for the treatment of blood products for transfusion, to enhance the safety of plasma-derived products.”

Cerus Corporation is developing medical applications for its proprietary nucleic acid-targeting technologies including its proprietary light-activated compound, S-59, and its proprietary pH-activated anchor-linker-effector (ALE) compound, S-303. The company is developing pathogen inactivation systems for blood components for transfusion (platelets, plasma and red blood cells) using these proprietary technologies. Programs for each of the three components are currently in clinical trials.

Single donations of whole blood can be processed into three primary components: red blood cells, which contain oxygen-carrying hemoglobin; platelets, which are specialized cells that can support clotting; and plasma, the liquid portion containing therapeutic proteins. Following required testing and blood typing, blood components can be used in transfusions for important clinical therapies. Human plasma may also be pooled from numerous donors and processed through plasma fractionation into several specialized components such as clotting factors, immunoglobulins, albumin and fibrinogen.

The Consortium for Plasma Science seeks to provide R&D funding worldwide for a universal approach to eradicate pathogens from human plasma without destroying the functionality of the plasma proteins. The Consortium is co-funded by four plasma fractionation companies, which share safety as a common goal: Alpha Therapeutics Corporation, a unit of the Japanese pan-national Yoshitomi; Bayer Corporation; Baxter Healthcare Corporation; and Centeon, a joint venture of Hoechst and Rhone-Poulenc. The Consortium, which is a separate entity from its member companies, hopes to accelerate the emergence of new technologies.

This news release contains forward-looking statements that involve risks and uncertainties. Actual results could differ materially from the above forward-looking statements as a result of certain factors, including the uncertainty of the timing and results of any trials, regulation by the FDA, the uncertainty of replication of animal data in humans, the uncertainty of market acceptance of any products, competitive conditions, the uncertainty of future financing and other factors discussed in Cerus Corporation's 1997 Annual Report on Form 10-K.