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AVANIR Pharmaceuticals (AMEX:AVN) today announced the initiation of a double-blind, placebo-controlled, multicenter, Phase III clinical trial of Neurodex(TM) in patients with diabetic neuropathic pain. The randomized, placebo-controlled study will assess efficacy, overall safety and tolerability of AVANIR's investigational drug targeting central nervous system (CNS) receptors to treat diabetic neuropathic pain. The 3-month study will assess the efficacy of Neurodex in relieving pain in adult patients with distal symmetrical diabetic neuropathy with daily pain in the lower extremities. The clinical trial will be conducted at 40 sites in the United States and will include assessment scales completed in the clinic and diary records to assess pain. Patients will be randomized to receive placebo or one of two dose levels of Neurodex. The clinical trial protocol was reviewed by the U.S. Food and Drug Administration (FDA) through a special protocol assessment (SPA) process. An SPA is a binding agreement between the FDA and the sponsor of a clinical trial documenting that if the study endpoints are met, the results should be sufficient to support approval of a New Drug Application (NDA). AVANIR expects that this will be the first of two Phase III clinical trials needed to submit an NDA for Neurodex for this indication. "AVANIR is committed to developing and commercializing Neurodex as the cornerstone of our CNS research and development program," said James E. Berg, Vice President of Clinical and Regulatory Affairs at AVANIR. "The results of our previous open-label study of Neurodex in patients with diabetic neuropathic pain were encouraging, and we are eager to explore the potential of Neurodex as a treatment for diabetic neuropathic pain in a larger placebo-controlled study. The goal is to be able to offer a new treatment option for diabetic patients with painful neuropathies." The results of a four-week Phase II open-label dose escalation safety study of Neurodex in patients with diabetic neuropathic pain were reported in November at the 2004 annual meeting of the American Society of Regional Anesthesia and Pain Medicine. Study data showed that Neurodex(TM) was well tolerated up to the highest target dose, and patients reported decreased pain intensity from that reported at baseline (p less than 0.0001). The degree of pain relief increased with the duration of the open label study. AVANIR Pharmaceuticals is a pharmaceutical company focused on developing and commercializing novel therapeutic products for the treatment of chronic diseases. AVANIR's product candidates address therapeutic markets that include central nervous system and cardiovascular disorders, inflammation, and infectious disease. AVANIR is currently in the process of submitting to the FDA a "rolling" new drug application for Neurodex for the treatment of pseudobulbar affect and expects to complete the submission by June 30, 2005. Recently, AVANIR partnered its preclinical research and development program for inflammatory disease with Novartis. The Company's first commercialized product, Abreva(R), is marketed in North America by GlaxoSmithKline Consumer Healthcare and is the leading over-the-counter product for the treatment of cold sores. Further information about AVANIR can be found at www.avanir.com. Except for the historical information presented herein, matters discussed in this press release contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. Statements that are not historical facts, including statements that are preceded by, followed by, or that include such words like "estimate," "anticipate," "believe," "intend," "plan," or "expect" or similar statements are forward-looking statements. Forward looking statements include, but are not limited to, risks associates with the timing of the Company's new drug application for Neurodex, regulatory decisions by the FDA for the Company's drug candidates, milestones, and royalties earned from licensees, and results of clinical trials or product development efforts, as well as risks described in the Company's most recent Annual Report on Form 10-K and in subsequent quarterly reports on Form 10-Q and from time-to-time in other publicly available information regarding the Company. Research findings are not always supportable by evidence obtained from subsequent clinical trials, and the Company can make no assurances that the Neurodex clinical trials will yield positive results. Final review decisions made by the FDA and other regulatory agencies concerning clinical trial results are often unpredictable and outside the influence and/or control of the company. The Company disclaims any intent or obligation to update these forward-looking statements.