Allon Therapeutics Releases Phase II MCI-CABG Results

Approximately two weeks after surgery, patients in both the treated and placebo groups performed at a level similar to age-matched normal adults on executive function and memory tests, suggesting that neither group was significantly impaired, and that the single-dose has no observable effect because no functional deficit was present.

Gordon McCauley, President and CEO of Allon, said, "There are a lot of data to show that MCI-CABG is a good model in which to test treatments for acute ischemic injuries, including stroke and traumatic brain injury. However, our study did not replicate the historical cognitive impairment with MCI-CABG."

"Our strategy was straightforward. Test this compound in multiple, well designed, and conservative Phase IIa clinical trials examining different medical conditions, different patient populations, and different dosing regimes to help us learn about the drug. What we have learned is that our repeat dose Alzheimer's program has shown strong human clinical validation."

"We will incorporate both the intranasal and intravenous products in our lead Alzheimer's program, where we have shown significant potential in an area of great need and commercial opportunity," McCauley said.

AL-108 and AL-208 are intranasal and intravenous formulations respectively of the same compound developed from the Company's Activity Dependent Neuroprotective Protein (ADNP) technology platform. Earlier this year AL-108 demonstrated statistically significant, dose dependent and durable results after three months treatment in a chronic condition, amnestic Mild Cognitive Impairment (aMCI), a precursor to Alzheimer's disease.

Conversely, the MCI-CABG study was designed to examine the potential of the same drug in an intravenous formulation to provide pre-insult protection with a single administration of drug after an acute injury, MCI-CABG.

The MCI-CABG trial did demonstrate that AL-208 was safe and well-tolerated by patients at a dose 20 times greater than the dose in the aMCI trial.

The Company will immediately focus development of AL-208 as a second generation Alzheimer's product behind its lead Alzheimer's product candidate AL-108, which is entering a Phase IIb clinical trial later this year.

In February 2008, Allon released positive topline results from a Phase IIa clinical trial that showed two daily 15 mg doses of AL-108 over 12 weeks of treatment resulted in statistically significant, dose-dependent and durable improvements on key endpoints that measure short-term recall and working memory - two types of memory that are clinically relevant in Alzheimer's disease - in patients diagnosed with aMCI, a precursor to Alzheimer's disease.

In July 2008, Allon's scientific presentations at the International Conference on Alzheimer's Disease and Related Disorders (ICAD 2008) in Chicago demonstrated that the Phase IIa aMCI clinical trial data support the results of several studies in animals that show AL-108 reduced the classic Alzheimer's "tangles" pathology and also increased memory function.

Allon announced August 12, 2008 that a pharmacokinetic study confirmed that AL-108 and AL-208 penetrate the blood brain barrier of healthy adults and Alzheimer's disease patients in sufficient quantities to enable a therapeutic effect on Alzheimer's and other neurodegenerative diseases. Test subjects were given a single 15 mg intranasal dose of AL-108 or an intravenous dose of 50 mg or 300 mg of AL-208. These doses were found to be safe and well-tolerated by the healthy volunteers and Alzheimer's patients. The results will help determine appropriate dosages for future clinical trials.

Allon expects to complete enrolment and report top-line results around the end of the year from a Phase IIa trial evaluating AL-108 as a treatment for the chronic cognitive impairment suffered by schizophrenia patients. The trial is managed and largely funded by TURNS (Treatment Units for Research on Neurocognition and Schizophrenia), which is supported by the U.S. National Institute of Mental Health.

MCI-CABG trial design and results

Allon enrolled 234 patients at 27 treatment sites in the United States and Canada.

The study was conducted in two parts: an open label safety stage; and a randomized, double-blind, placebo controlled stage. A total of 210 subjects were enrolled in the double-blind portion of the study, 105 in the placebo group and 105 in the active group.

The demographics including age, mini-mental state examination score, and depression score (CES-D) were similar for the groups. The active group was administered 300 mg of AL-208 as a 15-minute intravenous infusion 30 minutes prior to the patient being placed on the bypass pump. The placebo group received an intravenous infusion of saline under the same conditions. Plasma concentrations of AL-208 were measured after the patient came off bypass pump and confirmed that adequate drug levels were present.

Consistent with the historical literature, patients were tested approximately two weeks post-surgery. Standardized, well-validated executive function tests included digit symbol, Trailmaking B, backwards digit span, verbal fluency task, letter number sequencing and Stroop colour-word interference were used. As well, memory tests were used including tests of immediate and delayed recall from the Weschler Memory Scale III (faces I & II, family pictures I & II, verbal paired associates I & II).

Age-adjusted scores indicated that the treated and placebo patients did not appear to be compromised in either executive function or memory. These results suggest that the single-dose had no observable effect because no functional deficit was present.

The primary endpoints were a series of executive function and memory tests, as well as executive function and memory composite scores comprised of the individual tests. The single-dose had no observable effect in any of the tests or the composite scores.

According to the literature, age and time-on-pump are risk factors for developing cognitive impairment after bypass surgery. Although there was a large range of time on pump (25 to 182 minutes for placebo and 26 to 202 minutes for treated), the means were similar at 88.4 minutes for placebo and 85.4 minutes for AL-208. Detailed co-variate analysis for both age and time-on-pump did not show any obvious correlation.

The data confirm that the drug is safe and well-tolerated. The overall incidence of adverse events was similar between the placebo and AL-208 groups (60% versus 61%) and the majority of the adverse events were mild to moderate in intensity.

Conference Call

Allon Therapeutics will hold a conference call and webcast today at 5 P.M. EDT to discuss the results of the MCI -CABG Phase IIa results and to update the Company's milestones for the remainder of 2008. Management's presentation will be followed by a question and answer session.

To access the conference call by telephone, dial 416-644-3425 or 1-800-594-3615 (toll free). The conference call will be archived for replay through September 4th, 2008. To access the archived conference call, dial 416-640-1917 or 1-800-718-6306 and enter the reservation number 21281688 followed by the number sign (#).

A live audio webcast of the conference call will be available at: http://www.allontherapeutics.com/ir_calendar.htm. Please connect at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be required to join the webcast. The webcast will be archived on the Company's website for 30 days.

About Allon's neuroprotective platforms

Allon's two neuroprotective technology platforms are based on two naturally occurring proteins secreted by the brain in response to a range of insults. The platforms are activity-dependent neuroprotective protein (ADNP) and activity-dependent neurotrophic factor (ADNF). Because the two platforms are based on different proteins, the drugs from each are different molecules with different therapeutic mechanisms and distinct commercial opportunities. Clinical-stage drugs AL-108 and AL-208 are derived from ADNP, while preclinical stage drug AL-309 is derived from ADNF.

About Allon

Allon Therapeutics Inc. is a clinical-stage biotechnology company developing treatments for major neurodegenerative conditions. In Q1 2008, Allon's drug AL-108 demonstrated human efficacy in amnestic mild cognitive impairment, a precursor to Alzheimer's disease. Allon has Phase II human efficacy programs pursuing two large underserved markets: Alzheimer's disease and schizophrenia-related cognitive impairment. The Company is listed on the Toronto Stock Exchange under the trading symbol "NPC" (Neuro Protection Company(TM)) and based in Vancouver. For additional information please visit the Company's website: www.allontherapeutics.com.

Forward Looking Statements

Statements contained herein, other than those which are strictly statements of historical fact may include forward-looking information. Such statements will typically contain words such as "believes", "may", "plans", "will", "estimate", "continue", "anticipates", "intends", "expects", and similar expressions. While forward-looking statements represent management's outlook based on assumptions that management believes are reasonable, forward-looking statements by their nature are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, events or developments to be materially different from any future results, events or developments expressed or implied by them. Such factors include, among others, the inherent uncertainty involved in scientific research and drug development, Allon's early stage of development, lack of product revenues, its additional capital requirements, the risks associated with successful completion of clinical trials and the long lead-times and high costs associated with obtaining regulatory approval to market any product which Allon may eventually develop. Other risk factors include the limited protections afforded by intellectual property rights, rapid technology and product obsolescence in a highly competitive environment and Allon's dependence on collaborative partners and contract research organizations. These factors can be reviewed in Allon's public filings at www. SEDAR.com and should be considered carefully. Readers are cautioned not to place undue reliance on such forward-looking statements and Allon disclaims any obligation to update or announce changes in any such factors except in its periodic filings.

Website: www.allontherapeutics.com