Avalon Pharmaceuticals, Inc. (Nasdaq and NYSE Arca: AVRX), announced that it will present pharmacodymanic endpoint data from a phase I study of AVN944 at the American Society of Hematology's 48th Annual Meeting to be held on December 9-12, in Orlando. AVN944 is the Company's lead product candidate for the treatment of hematologic malignancies.

Dr. Jeffrey Strovel, Senior Scientist at Avalon, is scheduled to discuss the data in a poster presentation titled, "Genetic and Biochemical Biomarkers of IMPDH Inhibition in Phase I Dose Escalation of AVN944 for Hematological Malignancies," on Sunday, December 10, 2006, at 6:00 p.m. EST.

In addition to the phase I objective of defining the maximum tolerated dose of AVN944, Avalon is examining a comprehensive set of pharmacodynamic biomarkers using its proprietary gene expression platform, AvalonRx(R). These markers, previously identified as responsive to AVN944 exposure in a multitude of laboratory settings, correlate with biochemical effects of the drug on protein function and guanine nucleotide levels, and can be used as tools to select the optimal dose with which to initiate phase II studies. This interim analysis of the trial data is intended to describe how these biomarkers correlate with biologic activity of the drug in patients on study.

An abstract of the Presentation is now available on the ASH website, hematology.

About AVN944

AVN944 is an oral small molecule drug candidate that inhibits inosine monosphospate dehydrogenase (IMPDH), an enzyme that is critical for cells to be able to synthesize guanosine triphosphate (GTP), a molecule required for DNA synthesis and cellular signaling. IMPDH is over expressed in some cancer cells, especially in the case of hematological malignancies. In laboratory experiments, AVN944 has been shown to inhibit IMPDH activity in cells, and suppress pools of GTP. Anticancer activities of IMPDH inhibitors correlate with sustained depletion of GTP pools both in cellular models and in human subjects. AVN944 appears to have a selective effect on cancer cells in that deprivation of GTP in normal cells results in a temporary slowing of cell growth, while GTP deprivation in cancer cells induces cell death, or apoptosis.

Results from preclinical studies of AVN944 indicate that AVN944 inhibited the proliferation of lymphoid and myeloid cells, the principal cells involved in the most common types of human leukemias. In a single-dose, dose-escalation phase I clinical trial of AVN944 conducted in the United Kingdom in healthy volunteers, AVN944: (1) was well tolerated at all tested doses with no notable side effects; (2) demonstrated good pharmacokinetic properties; and (3) had a significant inhibitory effect on IMPDH enzyme activity. Avalon filed an IND with the FDA in August 2005 and initiated U.S. phase I clinical trials in January 2006 for the treatment of hematological cancers.

About Avalon Pharmaceuticals

Avalon Pharmaceuticals is a biopharmaceutical company using proprietary technology, AvalonRx(R), to discover and develop cancer therapeutics. Avalon has a lead product in phase I clinical development (AVN944 - IMPDH inhibitor); preclinical programs to discover inhibitors for the Beta-catenin, Aurora and Survivin pathways; and drug discovery collaborations with MedImmune, Novartis, ChemDiv and Medarex. Avalon Pharmaceuticals was established in 1999 and is headquartered in Germantown, Maryland.

About AvalonRx(R)

AvalonRx(R) is a comprehensive, innovative and proprietary suite of technologies based upon large-scale gene expression analysis. This platform facilitates drug discovery by expanding the range of therapeutic targets for drug intervention, including targets and target pathways frequently considered intractable using conventional HTS approaches, allows more informed decisions about which compounds to advance towards clinical trials, and facilitates drug development through identification of biomarkers of efficacy that can stratify patients or provide early indicators of response.

Safe Harbor Statement

This announcement contains, in addition to historical information, certain forward-looking statements that involve risks and uncertainties, in particular, related to progress in our drug discovery programs and our collaborations, and clinical progress in the development of AVN944. Such statements reflect the current views of Avalon management and are based on certain assumptions. Actual results could differ materially from those currently anticipated as a result of a number of factors, risks and uncertainties including the risk that the discovery programs and collaborations may not be successful and that AVN944 will not progress successfully in its clinical trials, and other risks described in our SEC filings. There can be no assurance that our development efforts will succeed, that AVN944 will receive required regulatory clearance or, even if such regulatory clearance is received, that any subsequent products will ultimately achieve commercial success. The information in this Release should be read in conjunction with the Risk Factors set forth in our 2005 Annual Report on Form 10-K and updates contained in subsequent filings we make with the SEC.

Avalon Pharmaceuticals, Inc.
hematology