Release issued 7th November 2003

Morphochem AG, the evolutionary drug discovery and development company, has announced the strengthening of its management team with the appointment of Alfred E. Seidel, PhD as Chief Executive Officer (CEO). Dr Seidel will drive strategic change at the Company as it advances its products into clinical development. Dr Seidel replaces Dr Lutz Weber, who will remain on the management team and focus his efforts as Chief Scientific Officer (CSO).

Dr Seidel has over 27 years of top management experience at the Sandoz Pharmaceuticals Group (now Novartis), working predominantly in America and Asia, most recently as Head of the Strategic Planning Department, East Hanover, NJ, USA and prior to that as CEO of the East Asian Regional Management Center, Hong Kong. His experience is in operational management as well as in strategic planning , which enabled the businesses under his control to achieve sustainable and profitable growth. He has an excellent reputation for "talent scouting" and for building strong management teams. Since taking early retirement from Sandoz (now Novartis) in 1997 he has led some US biotech companies, developed their strategic priorities, raised successfully private equity funds, formed strategic alliances and upon completion of the turnaround mission hired successor CEOs. These strategic planning and operational skills will be employed at Morphochem thereby driving the business forward.

Commenting on his appointment, Dr Seidel said:

"Morphochem AG enjoys fascinating opportunities that will benefit patients, employees and investors.. Morphochem is highly regarded for its smart chemistry and drug discovery engine, MORESystem. It has exciting compounds in early development and is on the verge of realizing these most attractive opportunities. I look forward to the challenge and pleasure of steering the Company particularly in the near term, and to finding a successor CEO to lead the Company longer term."

This strengthening of the management team follows on from the recently announced changes to the Supervisory Board, i.e. with the appointment of Dr Max Link, as Chairman of the Board and Dr Thomas Hecht as non-executive director.

Commenting on the new appointment, Dr Link said,

"We are delighted that Dr Seidel is joining Morphochem at this time when the Company is positioning itself to expand into product development. We believe his solid background in change management and strategy development, gained at Sandoz and other biotechnology companies, provides the right mix of skills and experience needed to lead Morphochem through the next phase of its corporate development."

He continued:

"On behalf of the Board and our investors I should like to thank Dr Lutz Weber for his substantial contribution to the Company to date. I feel confident that he will continue to provide outstanding scientific leadership as CSO. Lutz has an excellent reputation for his scientific expertise and skills which have been instrumental in bringing science at Morphochem to life."

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Morphochem AG www.morphochem.com Morphochem discovers and develops highly selective small molecule compounds for the medicines of tomorrow. The Company integrates novel chemistries with biological screening on the basis of its proprietary MolMind technology. Its unique and highly integrated chemical genomics platform provides a continuous flow of novel drug candidates for unmet medical needs in major disease areas, such as cancer and anti-infectives.

Morphochem was founded in Munich in 1996 and is an integrated, transnational drug discovery and development company, currently employing some 100 staff. To date the Company has raised EUR 78 million in four financing rounds.

Alfred E. Seidel, PhD worked with the Sandoz Pharmaceuticals Group (now Novartis), for 27 years where he most recently was responsible as Head of Strategic Planning, East Hanover, NJ USA from 1994 until 1997. Prior to that he served as CEO of their East Asian Regional Management Center, Hong Kong from 1980 until 1994. Clear strategic priorities on those Sandoz Group products with the highest sustainable competitive edge and relative medical need led this East Asian operation to top line growth of over 21 % compounded annually over the 14 years and to over 38 % at the bottom line. His operation thereby counted among the top ten income earners for Sandoz Pharma in 1994. Prior to that, i.e. from 1976 until 1980 he was CEO of the Sandoz Indonesia subsidiary in Jakarta which he turned profitable in the third year.

Since 1997 he has held numerous CEO positions at biotech companies including, Pyxis, Inc, Melbourne, Australia, Orbon Corporation, San Mateo, CA, USA, and most recently at Osiris Therapeutics Inc, Baltimore, MD, USA. At Osiris he has aggressively developed a strategic alliance with Boston Scientific Corp. that had a value of as USD 100 mio. Dr Seidel has an MBA, and PhD in Business and Economics from the St Gall Graduate School of Economics and Business Administration, St Gall, Switzerland. He has also participated in the International Senior Management Program at the Harvard Business School, Cambridge, MA, in 1986.

(4th February 2004) Boehringer Ingelheim enters into multi-target drug discovery collaboration with Morphochem

(8th December 2003) Morphochem enters into research collaboration with Novartis for use of its MOREsystem in lead discovery

(16th October 2003) New appointments prepare Morphochem for cancer product development

(4th July 2003) Morphochem launches new website that reflects its transition to a drug development company

(27th March 2003) Morphochem and Xenogen collaborate to develop novel drug candidates against bacterial biofilms