NEWTOWN, Pa., Nov. 5 /PRNewswire/ -- CollaGenex Pharmaceuticals, Inc.
(Nasdaq: CGPI) today announced that it had signed an agreement with Heska
Corporation (Nasdaq: HSKA) pursuant to which Heska will develop certain of
CollaGenex's chemically modified tetracyclines ("CMTs") for use in companion
animal health applications, including osteoarthritis, periodontal disease and
cancer.  This collaboration is expected to result in commercial products
following development and regulatory approval.
    The core technology is the basis of Periostat(R), which is pending FDA
approval for the treatment of human periodontal disease.  CollaGenex also has
a number of collaborations to develop its core technology for human health
applications, including osteoarthritis, cancer and wound healing.
    "We believe that our compounds have great promise for both human and
animal health applications," said Brian M. Gallagher, Ph.D., President and
Chief Executive Officer of CollaGenex.  "Animal health represents a large
potential market opportunity for our compounds, and the regulatory timelines
are relatively short.  Also, in addition to its commercial potential, this
collaboration will provide CollaGenex with valuable preclinical data that will
be useful as we pursue human therapeutic applications of our core technology."
    Fred M. Schwarzer, Chief Executive Officer of Heska said, "This
collaboration provides Heska with access to a number of proprietary compounds
that have demonstrated efficacy in inhibiting matrix metalloproteinases
implicated in a number of degenerative diseases.  These compounds will be
manufactured using known processes and they have a good safety profile.  We
will be focusing our development efforts in the area of osteoarthritis,
potentially a $50 million market in companion animal health."
    CollaGenex Pharmaceuticals, Inc. is engaged in the development and
commercialization of innovative proprietary medical therapies for the
treatment of periodontal disease and other pathologies.  The Company's core
technology involves inhibiting the activity of certain enzymes that destroy
the connective tissues of the body.  In addition to periodontal disease, the
Company and its collaborators are researching and developing other potential
applications of the core technology, including cancer metastasis, wound
healing, osteoarthritis, osteoporosis, rheumatoid arthritis and diabetic
complications.
    Heska Corporation discovers, develops, manufactures and markets companion
animal health products, primarily for dogs, cats and horses.  Heska has a
large, sophisticated, scientific effort devoted to applying biotechnology to
the large and growing companion animal health market.  Heska also provides
diagnostic laboratory services to veterinarians in the U.S. and U.K. and
operates facilities licensed by the USDA and FDA to manufacture vaccines,
pharmaceutical and allergy immunotherapy products.
    This news release contains forward-looking statements and therefore it
necessarily involves risks and uncertainties.  Factors that could cause actual
events to differ from these forward-looking statements are set forth under the
caption "Risk Factors" in the company's prospectus dated June 20, 1996, which
is part of its registration statement on file with the Securities and Exchange
Commission.  There can be no assurance that the company will receive
regulatory approval to market any product or, if such approval is received,
that the product will be commercially successful.

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