New Drug Applications

Surfaxin

lucinactant

Treatment for Respiratory Distress Syndrome

Discovery Labs Receives Second Approvable Letter From FDA for Surfaxin for RDS

WARRINGTON, Pa., April 5, 2006 -- Discovery Laboratories, Inc. today announced that it has received a second Approvable Letter from the U.S. Food and Drug Administration (FDA) for Discovery's lead product candidate, Surfaxin (lucinactant) for the prevention of Respiratory Distress Syndrome (RDS) in premature infants. Surfaxin is a precision-engineered, peptide-containing, synthetic surfactant that is designed to closely mimic the function of natural human lung surfactant and represents a potential alternative to animal-derived surfactants.

The Approvable Letter is an official notification from the FDA and contains conditions that must be satisfied by Discovery prior to obtaining final U.S. marketing approval. Specifically, the FDA is requesting certain information primarily focused on the Chemistry, Manufacturing and Controls (CMC) section of the NDA. The information predominately involves the further tightening of active ingredient and drug product specifications and related controls. Consistent with previous review, the FDA does not have any clinical or statistical comments. Discovery is in the process of arranging a meeting with the FDA regarding conditions for final approval. The Company anticipates that this meeting will clarify timelines with respect to its response to the FDA.

This is the second Approvable Letter received by the Company from the FDA since the Company's NDA for Surfaxin was filed in April 2004. Our previously submitted responses to the first Approvable Letter were accepted by the FDA as a complete response in October 2005.

Robert J. Capetola, Ph.D., President and Chief Executive Officer of Discovery, commented, "Our top priority is to satisfy the FDA's requests as soon as possible, so that we can obtain final approval for this important life-saving therapy and make it available to the neonatal community. In light of today's news, we are analyzing all aspects of our business with an intention to conserve cash while remaining focused on developing our NICU franchise of Surfaxin and Aerosurf(tm)."

RDS is a life-threatening and costly breathing disorder that strikes tens of thousands of premature infants in the United States each year, with a global at-risk population in excess of 500,000 infants. Approximately 75,000 infants are treated with surfactants in the United States annually. Current surfactant treatment options are limited to animal-derived surfactants harvested from bovine (cow) and porcine (pig) sources.

Data from Discovery's pivotal, multinational SELECT study demonstrates that Surfaxin was significantly more effective in the prevention of RDS and improved survival and other outcomes versus comparator surfactants. The SELECT and STAR (a supportive Phase 3 study) trials, as well as a pooled Phase 3 analysis, have been presented at several international medical meetings and the results from the two studies were published in Pediatrics.

Source: Discovery Laboratories, Inc.

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