MorphoSys Provides Update on Pipeline Activities in 2009

MorphoSys to Accelerate the Expansion and Advancement of its
Proprietary Pipeline

MorphoSys AG (FSE: MOR; Prime Standard Segment, TecDAX) today
outlined its planned proprietary developments for 2009 and provided
an update on its partnered antibody pipeline. The Company intends to
advance and broaden its proprietary therapeutic antibody pipeline
with its most advanced compound MOR103 expected to enter a phase 2
clinical trial in the second half of 2009. MorphoSys is in a robust
position to increase its investment in proprietary drug development,
with strong and increasing revenues from its partnered discovery
business, a cash balance in excess of EUR 130 million at December 31,
2008 and no material bank debt. The Company plans to more than
double its investment in proprietary R&D in 2009, and expects to
record a healthy profit as in previous years.

"MorphoSys is ideally positioned to advance its pipeline in 2009",
commented Dr. Simon Moroney, Chief Executive Officer of MorphoSys
AG. "We have a solid financial foundation, plus a proven technology
and promising targets, which together give us the means of building a
very strong proprietary drug pipeline. Even in this challenging
economic climate, MorphoSys is ideally positioned to build value by
advancing its pipeline, while maintaining profitability."

The Company's proprietary pipeline activities in 2009 are projected
to comprise:
i) The start of a phase 1b/2a clinical trial in rheumatoid
arthritis for lead compound MOR103;
ii) Finalizing the evaluation of MOR103 in a second indication
and preparation for an additional phase 2 clinical trial;
iii) Formal pre-clinical development and manufacturing of clinical
grade material for MOR202;
iv) The addition of up to 5 proprietary de novo programs to its
pipeline, one of which was already started recently;
v) One pre-development program with Novartis - the pre-development
agreement provides MorphoSys with the option to enter a formal
co-development for the respective program;
vi) Validation of three targets together with Galapagos which are
intended to become the subject of therapeutic antibody programs in
the future.

As a result of the planned activities MorphoSys's proprietary
pipeline at year-end could consist of up to 8 programs in total,
including one co-development program with Novartis - up from two
fully-owned and one pre-development program in 2008.

"The expansion of our proprietary pipeline is a key value driver for
MorphoSys and we expect to achieve significant progress during 2009
in this regard", commented Dr. Arndt Schottelius, Chief Development
Officer of MorphoSys AG. "By the end of 2009, we plan to have a rich
proprietary pipeline based on the well-established and widely-proven
HuCAL technology while enjoying the tailwind from our partner
pipeline programs further advancing into clinical trials."

The phase 1 clinical trial for MOR103 in healthy volunteers has been
completed and is currently in the analysis stage. The final data will
be reported in Q2 2009. Additional pre-clinical investigations of
MOR103 in animal models for other inflammatory diseases are currently
being conducted. MorphoSys intends to out-license MOR103 for the
treatment of rheumatoid arthritis after establishing clinical
proof-of-concept. With regard to the cancer program MOR202, formal
pre-clinical development is ongoing. In 2009, toxicology studies
will be conducted to support regulatory filing for a phase 1 clinical
trial. Production of clinical material for MOR202 and MOR103 for the
phase 1 and 2 trials, respectively, will continue during the course
of 2009. Recently, MorphoSys added one de novo HuCAL antibody
program to its portfolio against an undisclosed oncology target. In
2009, MorphoSys anticipates antibody generation and in depth in vitro
profiling of target-specific antibody candidates. One additional
oncology target has already been selected and the respective antibody
program will be started in the course of 2009. Further targets in
inflammatory and oncology indications will be evaluated in 2009,
which may be the basis for further proprietary HuCAL programs.

Complementing its portfolio of fully owned programs, MorphoSys has
secured several co-development options in its partnerships with
Novartis and Galapagos and will continue to evaluate additional
opportunities. Within these programs, development costs are shared
equally or, in the case of MorphoSys's partnership with Novartis,
early-stage costs are fully covered by the partner. In 2008,
MorphoSys exercised its first option to participate in the
development of a therapeutic antibody program within its
collaboration with Novartis. The agreement provides MorphoSys with
the option to enter formal co-development of the program, sharing
costs and profits up to 50%. As a result of the alliance signed with
Galapagos in November 2008, an initial set of three targets has been
selected for validation through disease-specific in vitro and in vivo
testing with antibodies provided by MorphoSys. If these studies are
successful, the alliance will select antibody programs for
pre-clinical and clinical development. Under the terms of the
agreement, Galapagos and MorphoSys will share the research and
development costs, as well as all future revenues, equally. In 2009,
Galapagos will conduct the production of these three proteins for the
alliance and MorphoSys will generate antibodies directed against the
targets. Additionally, Galapagos will apply its target discovery
platform during 2009 and the parties may select additional targets
for subsequent joint target validation studies.

Summarizing all planned activities, MorphoSys today provided a
snapshot of the status of its proprietary pipeline envisioned for the
end of 2009: The Company anticipates having three targets in
validation studies jointly with Galapagos, up to six proprietary
compounds in the discovery stage including one co-development program
with Novartis, one program in formal pre-clinical development, and
one antibody in a phase 2 study. Of the total 2009 R&D budget,
approximately half, or EUR 18 million - EUR 20 million, will be
invested in proprietary drug and technology development. The
majority of this investment is earmarked for the further development
of MOR103 and MOR202.

Additionally, the Company will continue to evaluate opportunities to
acquire or in-license drug candidates from third parties, potentially
exploiting its strong balance sheet to secure attractive
opportunities. These activities could significantly increase the
value of MorphoSys beyond the plans outlined today.

"We expect our revenues to continue to grow, enabling us to channel
significant funds into our proprietary R&D", commented Dave Lemus,
Chief Financial Officer of MorphoSys AG. "We are in a sound financial
position to create new value for our shareholders by investing in
selected pipeline programs. We anticipate making investments in 2009
of approximately EUR 18 million to EUR 20 million in proprietary
R&D. Even with this substantial increase in R&D investment, we
expect to maintain a healthy level of profit."

Meanwhile, the Company's partnered pipeline continues to progress.
The partnered pipeline is distinguished from proprietary activities
by the fact that the former is fully funded by the Company's
partners. As of the beginning of 2009, MorphoSys's partnered
pipeline consists of 55 partnered programs, including one program in
phase 2 clinical trials. The partnered pipeline is the source of
ongoing milestone payments and will provide lucrative royalty streams
in the years to come.

As part of the expansion of its proprietary and partnered development
efforts, MorphoSys intends to further build its R&D team. As a
result, the Company is expecting to hire more than 40 new employees
in R&D in 2009, mainly at the Group's headquarters in Munich,
Germany.

MorphoSys will provide further details around its pipeline activities
and give financial guidance for the full year at its year-end 2008
Results Press Conference and Analyst Meeting in Frankfurt, Germany on
February 26, 2009.

For further information please contact: Dr. Claudia Gutjahr-Löser,
Head of Corporate Communications & Investor Relations, Tel: +49 (0)
89 / 899 27-122, gutjahr-loeser@morphosys.com or Mario Brkulj, Senior
Manager Corporate Communications & Investor Relations, Tel: +49 (0)
89 / 899 27-454, brkulj@morphosys.com

About MorphoSys:
MorphoSys is a publicly traded biotechnology company focused on the
generation of fully human antibodies as a means to discover and
develop innovative antibody-based drugs against life-threatening
diseases. MorphoSys's goal is to establish HuCAL as the technology of
choice for antibody generation in research, diagnostics and
therapeutic applications. The Company currently has therapeutic and
research alliances with the majority of the world's largest
pharmaceutical companies including Boehringer Ingelheim,
Centocor/Johnson & Johnson, Novartis, Pfizer and Roche. Within these
partnerships, more than 50 therapeutic antibody programs are ongoing
in which MorphoSys participates through exclusive license and
milestones payments as well as royalties on any end products.
Additionally, MorphoSys is active in the antibody research market
through its AbD Serotec business unit. The business unit has
operations in Germany (Munich), the U.S. (Raleigh, NC) and U.K.
(Oxford). For further information please visit
http://www.morphosys.com/

HuCAL®, HuCAL GOLD®, HuCAL PLATINUM® and RapMAT® are registered
trademarks of MorphoSys AG
This communication contains certain forward-looking statements
concerning the MorphoSys group of companies. The forward-looking
statements contained herein represent the judgment of MorphoSys as of
the date of this release and involve risks and uncertainties. Should
actual conditions differ from the Company's assumptions, actual
results and actions may differ from those anticipated. MorphoSys does
not intend to update any of these forward-looking statements as far
as the wording of the relevant press release is concerned.

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