Basilea Pharmaceutica opens U.S. phase III study on alitretinoin for the treatment of severe chronic hand eczema

Basel, Switzerland, December 17, 2008 - Basilea Pharmaceutica Ltd.
(SIX:BSLN) announces that it has opened a clinical phase III study on
alitretinoin in the U.S. The "HANDEL" trial (HAND Eczema research of
aLitretinoin) is the first ever multi-centered, controlled clinical
study for patients with severe chronic hand eczema (CHE) performed in
the U.S.

"There is a real sense of excitement within the dermatology community
with the start of this important trial," said Dr. Donald Belsito,
HANDEL Lead Investigator and Director of Dermatology at University of
Kansas Medical Center. "Chronic hand eczema is a debilitating
condition, and there are currently no FDA approved treatment options
for patients unresponsive to potent topical steroids."

Dr. Anthony Man, CEO of Basilea Pharmaceutica Ltd. said,
"Alitretinoin has already been approved in several EU Member States
as therapy for severe chronic hand eczema unresponsive to potent
topical steroids. This study is designed to evaluate the safety and
efficacy of the drug in a U.S. patient population."

The HANDEL study is a double-blind, placebo-controlled, randomized
clinical trial that will investigate the efficacy and safety of
alitretinoin in the treatment of severe CHE that has not responded to
potent topical steroids. In the HANDEL trial participants will be
randomized to receive oral alitretinoin or placebo for up to 24
weeks. The primary endpoint of the clinical trial is the response
rate as measured by the achievement of clear or almost clear hands
according to the Physician's Global Assessment. Assessments of safety
will be similar to that employed in previous large studies. Likewise
a pregnancy risk management plan for female patients of childbearing
age will be established. The study will take place at approximately
90 sites across the United States and is planned to enroll 600
patients.

About alitretinoin
Alitretinoin is a naturally occurring, physiologic retinoid that is
thought to work in CHE through anti-inflammatory and immunomodulatory
effects. The oral retinoid has been launched in Denmark, Germany and
the United Kingdom under the trade name Toctino® for the treatment of
adults with severe chronic hand eczema unresponsive to potent topical
corticosteroids. Toctino® has also received marketing authorization
in Finland and France and has been recommended for approval in six
additional EU Member States. Launches in other European countries are
expected to begin in the first half of 2009. Alitretinoin is also
under regulatory review in Canada and Switzerland.

The regulatory submissions for alitretinoin in Europe and Canada were
based on an ex-U.S. Phase III clinical trial program in which more
than 1600 patients with hand eczema were included in therapeutic
studies. The primary efficacy endpoint of the trials was a clinical
response defined as clear or almost clear hands. A six month
post-treatment observation period measured the rate of relapse among
all patients who achieved the protocol defined clinical response.

Alitretinoin is a known potent teratogen (a substance that can cause
birth defects when women are exposed during pregnancy). Strict
pregnancy prevention one month before, during, and one month after
cessation of treatment as well as monthly pregnancy testing are
required for women of childbearing age in the HANDEL trial.
Further details on this study will soon be posted on
www.clinicaltrials.gov

About chronic hand eczema
Hand eczema is a common skin disease which is often chronic and
relapsing. Severe chronic hand eczema is characterized by thick,
scaly skin that commonly gives rise to blisters, redness, swelling
and painful cracks in the skin[1],[2]. Studies suggest these patients
have a significantly reduced quality-of-life and substantial
occupational disability, including prolonged sick leave and
unemployment, as well as low self-esteem and social phobia.

About Basilea
Basilea Pharmaceutica Ltd. is headquartered in Basel, Switzerland,
and listed on the SIX Swiss Exchange (SIX:BSLN). Basilea's integrated
research and development operations are currently focused on new
antibacterial and antifungal agents to fight drug resistance and on
the development of dermatology drugs. Basilea's products are targeted
to satisfy high medical and patient needs in the hospital and
specialty care setting. The company owns a diversified portfolio
including two commercialized drugs (alitretinoin, ceftobiprole) and
one investigational drug (isavuconazole) in phase III. Alitretinoin
(Toctino®) is marketed in the United Kingdom, Denmark and Germany and
is approved in Finland and France. Alitretinoin has been recommended
for approval in six additional EU Member States and is under
regulatory review in Canada and Switzerland. Ceftobiprole is marketed
in Canada. It is approved in Switzerland and received a positive
opinion from the European Committee for Medicinal Products for Human
Use. The company has submitted marketing applications for
ceftobiprole in the U.S. and several other countries. The company has
set up commercial organizations in UK, Denmark, Germany and Canada,
while it is building sales and marketing organizations in other
countries to commercialize alitretinoin and to co-promote
ceftobiprole, subject to approval.

Disclaimer
This communication expressly or implicitly contains certain
forward-looking statements concerning Basilea Pharmaceutica Ltd. and
its business. Such statements involve certain known and unknown
risks, uncertainties and other factors, which could cause the actual
results, financial condition, performance or achievements of Basilea
Pharmaceutica Ltd. to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements. Basilea Pharmaceutica Ltd. is providing
this communication as of this date and does not undertake to update
any forward-looking statements contained herein as a result of new
information, future events or otherwise.

For further information, please contact:

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| Media Relations | Investor Relations |
|----------------------------------+--------------------------------|
| Jean-Christophe Britt, Ph.D. | Barbara Zink, Ph.D., MBA |
| Corporate Communication & Public | Head Corporate Development |
| Relations | +41 61 606 1233 |
| +41 61 606 1354 | investor_relations@basilea.com |
| media_relations@basilea.com | |
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This press release can be downloaded from www.basilea.com

References:
1. Burns T et al. Rook's Textbook of Dermatology. 7th edition. 2004.
Blackwell Science
2. Menne T and Maibach H. Hand Eczema, 2nd Edition. 2000.
Dermatology: Clinical and Basic Science Series

The press release can also be downloaded from the following link:

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