AVANIR Initiates Clinical Trial Program for Novel Allergy/Asthma Treatment

FDA Accepts Investigational New Drug Application

SAN DIEGO, March 17 /PRNewswire-FirstCall/ -- AVANIR Pharmaceuticals (Amex: AVN) announced today that the U.S. Food and Drug Administration (FDA) has allowed its Investigational New Drug (IND) application for its proprietary small molecule, AVP 13358. AVANIR is developing AVP 13358 as a potential treatment for allergy and asthma. Allowance of the IND permits AVANIR to initiate Phase I clinical trials. The initial Phase I clinical trial to determine single-dose safety of the drug in healthy volunteers is scheduled to begin in April 2003.

AVANIR's orally active compound, AVP 13358, is designed to act early in the body's response to allergens by pre-empting the production or release of mediators involved in asthma and allergic rhinitis. The approach is unique because it selectively targets both the production of the IgE antibody that is released by the immune system in response to allergen exposure, and a critical group of cytokines (Th2) thought to regulate the production of the antibody. Existing drugs such as antihistamines act to suppress the symptoms of allergy but have little effect on the development or progression of the disease.

"The initiation of this clinical trial represents the accomplishment of our goal of having active drug development programs in all phases of development. We now have an approved product and potential products in Phase III, Phase II and Phase I," said Gerald J. Yakatan, Ph.D., President and CEO of AVANIR Pharmaceuticals. "Our strategy is to initiate our clinical trials program and to partner with a pharmaceutical company interested in working with us to develop this platform technology."

No orally active drugs are currently marketed for the treatment of excess IgE or Th2 cytokines, and AVANIR believes that a compound that acts on these critical mediators would provide a valuable new tool for the treatment of asthma and allergic rhinitis.

About Allergy and Asthma

Each year more than 50 million Americans suffer from allergic diseases. Allergic diseases are the sixth leading cause of chronic disease in the United States, costing the healthcare system over $18 billion annually. The prevalence of allergic diseases continues to grow, reflecting both increased exposure and enhanced responses to allergens.

The impact of asthma is widespread with a higher prevalence in developed countries. An estimated 15 million Americans suffer from asthma. Two hundred million people are affected worldwide. Annual costs for asthma in the U.S. are estimated to be $14.5 billion. The current cost of prescription medication for asthma is over $2.5 billion in the U.S. and $6 billion worldwide.

About AVP 13358

AVP 13358 is a novel drug molecule discovered by scientists at AVANIR that is intended to inhibit the production of IgE antibodies, a well-known mediator of allergy and asthma. In addition to its effect on IgE, this compound has demonstrated an ability to suppress the antigen-stimulated IL-4 and IL-5 responses with potencies similar to those observed for IgE suppression. AVP 13358 also suppresses markers of disease in mouse models of asthma, including pulmonary lavage levels of IL-4, IL-5, eosinophils, and lymphocytes, as well as expression of CD23 and the IL-4 receptor (IL-4Ralpha) on leukocytes. No inhibitory effects on antigen-specific IgG responses were observed. AVP 13358 is orally active and appears to be selective for the suppression of Th2 cytokine-mediated diseases.

About the Company

AVANIR Pharmaceuticals, based in San Diego, is a drug discovery and development company with a commercialized FDA-approved product (Abreva(R)) and a product in Phase III clinical trials (Neurodex(TM)). AVANIR is engaged in small-molecule research to develop treatments for central nervous system disorders and inflammatory diseases. Through the use of its Xenerex(TM) technology, AVANIR also develops human monoclonal antibodies for therapeutic applications. Further information about AVANIR can be found at www.avanir.com .

The information contained in this press release, including any forward-looking statements contained herein, should be reviewed in conjunction with the Company's most recent Annual Report on Form 10-K and other publicly available information regarding the Company. Copies of such information are available from the Company upon request. Such publicly available information sets forth many risks and uncertainties related to the Company's business and technology. Forward-looking statements often contain such words like "estimate," "anticipate," "believe," "plan" or "expect". Our IgE modulation program competes with other research approaches and compounds under development by large pharmaceutical and biotechnology companies. Pre-clinical research findings are not always supportable by evidence obtained from subsequent clinical trials. Final review decisions made by the FDA and other regulatory agencies concerning clinical trial results are unpredictable and outside the influence and/or control of the Company.

For further information please contact Analyst/Investors, Tricia Ross of FRB|Weber Shandwick, +1-310-407-6540, tross@webershandwick.com, for AVANIR Pharmaceuticals; Media, Dennis Ellman of Beck Ellman Heald, +1-858-453-9600, dme@behmedia.com, for AVANIR Pharmaceuticals; or Investor Relations, Patrice Saxon of AVANIR Pharmaceuticals, +1-858-622-5202, psaxon@avanir.com. SOURCE AVANIR Pharmaceuticals

CONTACT: Analyst/Investors, Tricia Ross of FRB|Weber Shandwick, +1-310- 407-6540, tross@webershandwick.com, for AVANIR Pharmaceuticals; Media, Dennis Ellman of Beck Ellman Heald, +1-858-453-9600, dme@behmedia.com, for AVANIR Pharmaceuticals; or Investor Relations, Patrice Saxon of AVANIR Pharmaceuticals, +1-858-622-5202, psaxon@avanir.com