As part of a strategic initiative, Auxilium Pharmaceuticals has concluded its co-promotion partnership with Oscient Pharmaceuticals for Testim 1% testosterone gel and has leased a biologics manufacturing facility for the commercial development of its injectable enzyme product AA4500. Also, to support the growth of Testim, the company initiated an expansion of its sales force.

“Because of AA4500’s potential to be the first, non-surgical, biologic treatment option for patients with several life-impacting conditions and the key role we expect AA4500 to play in our future growth, we concluded that controlling the majority of the manufacturing of the active ingredient in AA4500 will be a strategic advantage,” said Armando Anido, Auxilium’s chief executive officer. “As the manufacturing facility already contains most of the equipment necessary to produce AA4500, we believe that the required modifications can be completed in time to include the facility in our initial BLA for the treatment of Dupuytren’s Contracture in 2007.”

Auxilium is developing AA4500 for the treatment of Dupuytren’s Contracture, Peyronie’s Disease and Frozen Shoulder Syndrome. The company plans to initiate a final Phase III trial for the treatment of Dupuytren’s Contracture and a Phase IIb dose optimization study for the treatment of Peyronie’s Disease later this year.

The biologics facility contains fermentation and purification equipment for the production of AA4500, laboratories for in-process and final product release testing, as well as development laboratories that Auxilium believes will be useful in R&D activities related to the life cycle management of AA4500 and other potential product candidates.

As part of the strategic initiative to control the commercial development of Testim, the company is increasing its sales force from the current 94 territories to approximately 150 territories and has mutually agreed with Oscient Pharmaceuticals to terminate the co-promotion partnership for Testim effective August 31, 2006. Auxilium will pay Oscient $1.8 million for the early termination.

“We believe that expanding our own sales force with employees consistently dedicated to Testim throughout the entire year will allow us to fully control our promotional efforts and build upon our excellent track record of growth for this product,” Mr. Anido commented.