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Biopharmaceuticals Gastroenterology

 News Release - January 8, 2008

Callisto Pharmaceuticals Announces Investor Conference Call to Provide Details on Guanilib Strategic Initiative in GI Disorders

NEW YORK--(HSMN NewsFeed)--Callisto Pharmaceuticals, Inc. (Amex: KAL; FWB: CA4), a developer of new drugs against gastrointestinal disorders and cancer announced today that it will hold an investor teleconference on January 14, 2008 at 10:00 AM EST to provide additional details regarding its strategic initiative to develop Guanilib for gastrointestinal disorders.

On October 3, 2007 Callisto announced plans to develop Guanilib, its guanylate cyclase C (GC-C) receptor agonist, for chronic constipation (CC) and constipation-predominant irritable bowel syndrome (IBS-C). Guanilib is an analog of uroguanylin, the natural hormone produced by the intestine and a key regulator of intestine function. The teleconference will provide additional details on the company’s plans for development of Guanilib as well as the large upside potential that this drug is capable of generating for the company.

“We have very high hopes for the development of Guanilib,” said Dr. Gary S. Jacob, Chief Executive Officer of Callisto. “Guanilib acts locally on receptors in the lining of the intestine and is not absorbed into the rest of the body. The FDA and the public are particularly focused on the issue of drug safety, and we believe that Guanilib’s safety profile should be a major advantage as we move this drug forward into the clinic.”

The value potential of GC-C receptor agonists to treat CC and IBS-C was recently set with the announced partnership between Microbia, Inc. and Forest Laboratories, Inc., with an upfront payment to Microbia of $70 million and milestone payments totaling $260 million for 50/50 co-development and promotion rights in the US, as well as rights for Canada and Mexico. Linaclotide showed promising data in a set of Phase IIa clinical trials in CC and IBS-C. Callisto plans to file an IND for Guanilib in the first quarter of 2008, and to initiate a Phase I trial shortly thereafter. The Company also plans to open a Phase Ib trial of Guanilib in CC in the second half of 2008.

“We believe that the value of Guanilib to Callisto has not yet been fully appreciated by Wall Street, and that Callisto is significantly undervalued,” noted Dr. Jacob. “The planned investor conference call is the first step in addressing this issue.”

The teleconference will be held at 10:00 AM Eastern Standard Time on January 14, 2008. The conference can be accessed by calling 866-202-3109, or +1-617-213-8844 from outside the US. The participant code is 61516766. To see the presentation slides and hear the teleconference via the web, please go to phoenix.zhtml?p=irol-eventDetails&c=120912&eventID=1720743. (Due to its length, this URL may need to be copied/pasted into your Internet browser's address field. Remove the extra space if one exists.)

Note that you will only be able to ask questions after the presentation via telephone. The presentation material and the teleconference will also be recorded and accessible later via the Callisto website at

About Guanilib

Guanilib (also called SP-304) is an analog (synthetic molecule) of uroguanylin, a natural gastro-intestinal hormone produced in the gut that is a key regulator of intestinal function. Guanilib works by activating a unique receptor on intestinal cells. The receptor, called the guanylate cyclase C (GC-C) receptor, promotes fluid and ion transport in the gastro-intestinal (GI) tract. Under normal conditions, the receptor is activated by the natural hormones uroguanylin and guanylin. Activation of the receptor leads to the transport of chloride and bicarbonate into the intestine, and water is carried with these ions into the lumen of the intestine, thereby producing a looser stool. Guanilib, developed by Callisto scientists, has been demonstrated to be superior to uroguanylin, in its biological activity, protease stability and pH characteristics. The compound is not absorbed systemically and demonstrates a very good safety profile. Guanilib has also been found to be effective in reducing inflammation in animal models of ulcerative colitis. Callisto plans to initiate clinical trials of Guanilib in early 2008.

About Chronic Constipation and Irritable Bowel Syndrome

Chronic constipation is a very common condition. Up to 26 million Americans suffer from the condition and of these about 5 million have a severe problem. The prevalence is similar in other developed countries. Patients with chronic constipation often experience hard stools, straining during bowel movements and not enough bowel movements during the week. People with chronic constipation can experience serious discomfort which adversely affects their ability to work and their quality of life. Up to one sixth of adults experience Inflammatory Bowel Syndrome (IBS), a condition marked by disturbed bowel function and abdominal pain. IBS patients can have three different sets of symptoms; diarrhea-predominant (IBS-D), constipation-predominant (IBS-C) and mixed or alternating disorder (IBS–M). About 35% of patients suffer from IBS-C. IBS accounts for 12% of adult visits to primary care physicians in the US.

There are currently few therapies available for chronic constipation or IBS-C. The main product in this market, Zelnorm from Novartis Pharmaceuticals (NYSE: NVS ), was withdrawn due to cardiotoxicity in April 2007 in the US. In 2006 Zelnorm sold about $561 million with about a 30% growth rate at the time of withdrawal.

About Callisto Pharmaceuticals, Inc.

Callisto is a biopharmaceutical company focused on the development of new drugs to treat various forms of gastrointestinal diseases and cancer. Callisto's drug candidates include a drug for gastrointestinal disorders as well as two anti-cancer agents. Callisto’s proprietary drug Guanilib in late preclinical development for gastro-intestinal disorders. Guanilib is a synthetic analog of the human gastrointestinal hormone uroguanylin, and acts by activating the guanylate cyclase C (GC-C) receptor on epithelial cells of the colon. The Company's lead drug in the clinic, Atiprimod, is presently in a Phase II clinical trial in advanced carcinoid cancer, a neuroendocrine tumor, and in a Phase II extension trial in advanced carcinoid cancer patients. Callisto’s second drug in the clinic, L-Annamycin, is currently in a Phase I/II clinical trial in adult relapsed or refractory acute lymphocytic leukemia, and in a Phase I clinical trial in children and young adults with refractory or relapsed acute lymphocytic leukemia or acute myelogenous leukemia. Callisto is also listed on the Frankfurt Stock Exchange under the ticker symbol CA4. More information is available at

Forward-Looking Statements

Certain statements made in this press release are forward-looking. Such statements are indicated by words such as "expect," "should," "anticipate" and similar words indicating uncertainty in facts and figures. Although Callisto believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations reflected in such forward-looking statements will prove to be correct. As discussed in the Callisto Pharmaceuticals Annual Report on Form 10-K for the year ended December 31, 2006, and other periodic reports, as filed with the Securities and Exchange Commission, actual results could differ materially from those projected in the forward-looking statements as a result of the following factors, among others: uncertainties associated with product development, the risk that products that appeared promising in early clinical trials do not demonstrate efficacy in larger-scale clinical trials, the risk that Callisto will not obtain approval to market its products, the risks associated with dependence upon key personnel and the need for additional financing.

Source: Callisto Pharmaceuticals

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