SAN DIEGO, April 20 /PRNewswire-FirstCall/ -- Alliance Pharmaceutical
Corp. (OTC Bulletin Board: ALLP) today announced that it has entered into
an amendment (the "Amendment") of its Senior Convertible Promissory Note
Purchase Agreement and Registration Rights Agreement with each of the
existing holders of Alliance's senior notes (the "Senior Notes").
    Pursuant to the Amendment, the maturity date of each outstanding Senior
Note was extended until April 1, 2007. The conversion price of each Senior
Note was reduced from $0.25 to $0.17, and the interest that will accrue on
each Senior Note from March 25, 2006 through April 1, 2007 was increased
from 6% to 10%. In addition, the holders of the Senior Notes will receive a
total of $11,419,000 in payments based on future royalties from Oxygent(TM)
product sales (or under certain conditions from milestone payments) payable
at a rate equal to 50% of such payments Alliance actually receives.
Finally, Alliance will continue to seek potential strategic partners or
merger candidates as a part of its business strategy.
    Operations update:
    As reported in Alliance's Annual Report on Form 10-KSB for the fiscal
year ended June 30, 2005 (the "10-KSB"), at the time of the filing of the
10-KSB, Alliance was: 1) identifying a contract manufacturer to begin the
transfer of the Oxygent technology for clinical production, 2) working with
its development partner in China, Beijing Double-Crane Pharmaceuticals,
Ltd. ("Double-Crane"), to file the equivalent of an Investigational New
Drug application (the "IND") related to Oxygent with the Chinese sFDA, and
3) collaborating with its development partner in Europe, Leo Pharma SA
("LEO") to design and initiate a Phase II Proof of Concept trial in Europe
to assess the safety and efficacy of Oxygent for improvement in
post-operative gut function (the "Phase II Proof of Concept Trial").
    To date, Alliance has identified a contract manufacturer to produce the
relevant clinical supplies for the Phase II Proof of Concept Trial and the
product samples required for the submission of an IND to the sFDA in China.
Alliance has completed the engineering studies, has run pre-production lots
in cooperation with this contract manufacturer and is currently proceeding
toward the manufacture of clinical material. Alliance and Double-Crane have
formed a Joint Development Team to manage the development of Oxygent in
China. Under its agreement with Double-Crane, Alliance is also obligated to
provide Double-Crane with the documentation necessary to enable
Double-Crane to translate all relevant data and other information into
Chinese prior to the submission of an IND with the sFDA. To date, Alliance
has provided all such necessary documentation, with the exception of the
manufacturing documentation. Alliance expects that this documentation will
be provided as product samples are released from manufacturing.
Double-Crane has already completed the translation of the pre-clinical and
clinical documentation.
    In addition, Alliance has contracted with two clinical research
organizations (one in the U.S. and one in Europe), and in collaboration
with its European partner, LEO, has also developed a protocol for the Phase
II Proof of Concept Trial. Seven clinical sites in three European countries
have been identified to conduct the trial. The protocol and all other
relevant information have been submitted to the Ethics Committee (similar
to the IRB in the U.S.) and the relevant Competent Authority in two of the
three countries in which the Phase II Proof of Concept Trial will be
conducted.
    In the U.S., Alliance has completed a pre-clinical study in cerebral
blood flow which Alliance believes demonstrates that Oxygent does not
increase cerebral blood flow but does maintain oxygenation to the brain
during serial hemodilution. We expect to submit this study along with other
relevant data to the FDA in 2006 in preparation of future clinical
development in the U.S.
    About Alliance Pharmaceutical Corp.:
    Alliance Pharmaceutical Corp., founded in 1989, is a development-stage
pharmaceutical company that is currently focused on developing its lead
product, Oxygent, which is based on its proprietary PFC technology. Oxygent
is being developed as an intravascular oxygen carrier designed to augment
oxygen delivery in surgical patients.
    Except for historical information, the matters set forth in this
release are forward-looking statements that are subject to risks and
uncertainties that could cause actual results to differ materially from
those set forth herein. Alliance refers you to cautionary information
contained in documents Alliance files with the Securities and Exchange
Commission from time to time, including the last Form 10-KSB and Form
10-QSB, and those risk factors set forth in the most recent registration
statement on Form SB-2 (File No. 333-119428). Alliance is under no
obligation (and expressly disclaims any obligation) to update or alter its
forward-looking statements, whether as a result of new information, future
events, or otherwise.

Link to this page: