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Contact:  Pam Rasmussen [Searle] (847) 470-6163 / Christi Foster [CoCensys] (714) 753-6112

COCENSYS AND SEARLE TO COLLABORATE ON DEVELOPMENT/MARKETING OF NOVEL INSOMNIA TREATMENT

MAY 21, 1996 -- Irvine, CA -- An agreement to co-develop and co-promote a novel new treatment for insomnia -- an affliction that affects nearly one-half of all American adults -- was announced today by CoCensys, Inc. (Nasdaq: COCN) and Searle, a wholly owned subsidiary of Monsanto Company (MTC).

Under the deal, Searle will make an up-front payment of $10 million for CoCensys' lead sleep-promoting compound, called CCD 3693, along with its back-up formulations. The up-front payment includes a $3 million licensing fee and a $7 million equity investment in preferred stock convertible to common stock. With the licensing fee, milestone payments and Searle's share of the development contribution for the U.S. market over the next six years, the co-development collaboration is potentially valued at up to $80 million. CoCensys and Searle will co-promote any resulting product in the United States, while Searle will have rights to develop, register and market any drugs derived from the collaboration in the rest of the world subject to a royalty payments.

"Searle is clearly the best partner to help us move this compound forward and bring it to market quickly," said Daniel L. Korpolinski, CoCensys' president and chief executive officer. "There is no other pharmaceutical company today that has Searle's depth of expertise in the sleep-therapy market. In fact, its medication for the short-term treatment of insomnia, AmbienĀ® (zolpidem tartrate), became the leader in its class after just 14 months on the market. That experience will be invaluable to the development of our new class of sleep medication."

CCD 3693, which should enter human testing in the next 18 months, is a synthetic version of a class of compounds being researched by CoCensys called Epalons (epialopregnanolones). Epalons are naturally occurring neuroactive steroids that bind to specific receptors in the brain that are completely independent of the receptors to which currently available sleep medications bind. CoCensys scientists were the first to define the function of these Epalon receptors -- including their role in promoting sleep -- and to use the findings to design and synthesize patentable Epalon analogs. These discoveries have led CoCensys to develop and test specific compounds for the treatment of epilepsy, anxiety and insomnia.

CCD 3693 has been designed to eliminate the limitations of naturally occurring Epalons: interaction with other steroid receptors and rapid metabolism by the liver into inactive compounds. Early research indicates that CCD 3693 will provide better-quality sleep with fewer potential side effects than currently available sleep medications.

"Searle is committed to furthering sleep education and treatment. This agreement with CoCensys is an exciting and natural extension of that mission," said Richard U. De Schutter, Chairman and CEO of Searle. "In the United States alone, research has shown that 49 percent of the adult population (87 million people) suffer from some degree of insomnia, frequently resulting in strained personal relationships, impaired performance -- even fatal accidents. Through this partnership with CoCensys, we hope to develop new therapeutic agents offering effective, state-of-the-art solutions to this major public-health problem."

CoCensys is a biopharmaceutical company focused on discovering, developing and marketing products to treat neurological and psychiatric disorders. The company's product development programs focus on two novel, proprietary classes of compounds: Epalons, to treat epilepsy, anxiety and sleep disorders; and excitatory amino acid (EAA) receptor antagonists to treat stroke, head trauma, chronic pain and epilepsy.

Searle is a research-based corporation headquartered in Skokie, IL, that develops, manufactures and markets pharmaceutical products and other healthcare services worldwide.

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