LA JOLLA, Calif., May 26 /PRNewswire/ -- SIBIA Neurosciences, Inc.
(Nasdaq: SIBI) and Eli Lilly and Company (NYSE: LLY) today announced that they
have entered into a three-year collaborative agreement to research and develop
compounds effective in treating disorders of the central nervous system (CNS).
SIBIA and Lilly will work together to identify and optimize compounds
selective for subtypes of nicotinic acetylcholine receptors (nAChRs).
    Under the terms of the three-year agreement, SIBIA will receive a minimum
of $20 million, which includes a payment in 1999 of $8 million for research
funding and an investment in equity by Lilly.  In addition, SIBIA could also
receive milestone payments and royalty payments.  In exchange, Lilly will
receive exclusive global rights to products that result from the
collaboration.  Lilly will conduct and fund all clinical trials for compounds
discovered during the project and will receive an exclusive option to SIBIA's
two clinical candidates, SIB-1508Y for Parkinson's disease and SIB-1553A for
Alzheimer's disease, both currently in phase II trials.
    "SIBIA's research on nAChR subtypes will greatly compliment our internal
efforts to identify promising compounds to treat a number of CNS diseases,"
said H. Christian Fibiger Ph.D., vice president neuroscience discovery
research and clinical investigation for Lilly.  "Our partnerships with leading
scientific companies are helping to further strengthen a rich pipeline of
products that holds tremendous promise and continues to grow."
    "A growing body of evidence suggests that regulation of specific nAChR
subtypes may allow therapeutic intervention in a number of disorders including
pain, schizophrenia, depression, Alzheimer's disease and Parkinson's disease,"
said Jeffrey F. McKelvy, Ph.D., executive vice president and chief scientific
officer of SIBIA.  "We believe that the nAChRs are a rich area for drug
discovery.  With the combination of the resource commitment from Lilly and the
expertise that each company brings to the collaboration we anticipate that
this joint effort could produce a number of drug candidates for neurological
and psychiatric disorders."
    William T. Comer, Ph.D., SIBIA's president and chief executive officer
stated, "We look forward to collaborating with Lilly in the development of
novel therapeutics to treat CNS diseases.  SIBIA and Lilly together will be
committing a significant number of dedicated scientists to apply our
proprietary nicotinic drug discovery technology to the identification and
development of new CNS subtype-selective compounds.  We will also be advancing
compounds already identified at SIBIA that are active on nicotinic
acetylcholine receptor subtypes.  Working with Lilly provides us an
opportunity to expand our efforts into this important CNS area."
    SIBIA Neurosciences, Inc. is engaged in the discovery and development of
novel small molecule therapeutics for the treatment of neurodegenerative,
neuropsychiatric and neurological disorders, many of which have large patient
populations and represent critical unmet medical needs.  SIBIA is a leader in
the development of proprietary drug discovery platforms that combine key tools
necessary for modern drug discovery, including genomics, high throughput
screening, advanced combinatorial chemistry techniques and pharmacology.  The
company's proprietary molecular targets and drug candidates, together with its
drug discovery technologies and research expertise, have enabled the company
to establish several corporate research collaborations.
    Lilly is a global research-based pharmaceutical corporation headquartered
in Indianapolis, Ind., that is dedicated to creating and delivering innovative
pharmaceutical-based health care solutions which enable people to live longer,
healthier, and more active lives.
    This press release contains forward-looking statements that involve risks
and uncertainties.  Actual results could differ materially from those
discussed herein.  These risks and uncertainties include risks and
uncertainties regarding SIBIA's ongoing litigation with Cadus, including
uncertainties regarding appeals and related proceedings, the companies
technologies, uncertainties regarding the company's SIB-1508Y and SIB-1553A
compounds, the risk that further development of such compounds will be
unsuccessful or terminated, the risk that Lilly will not exercise its options
to acquire rights to such compounds, the risk that SIBIA may never receive any
milestone or royalty revenue from such compounds or any other compound,
uncertainties regarding SIBIA's future capital needs and the uncertainty of
receiving additional funding, and other research, development and market
risks.  These and other risks and uncertainties are more fully set forth in
both company's most recently filed Forms 10-Q and 10-K.

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