AltaRex Corp., a company which focused on research, development and commercialization of antigen-targeted antibody-based therapies for life threatening diseases utilizing monoclonal antibodies as immunotherapeutic agents, and a wholly-owned subsidiary of United Therapeutics Corporation have entered into an exclusive license agreement for the development of five monoclonal antibodies that activate the immune system to treat cancer.

The strategic collaboration is centered on AltaRex's OvaRex (oregovomab) antibody that is currently in late-stage clinical development for the treatment of metastatic ovarian cancer. The four additional products are intended to treat lung, breast, prostate, multiple myeloma and other forms of cancer.

Under the terms of the agreement, the United Therapeutics subsidiary receives exclusive rights for development and commercialization of the five products worldwide, with the exception of rights retained by AltaRex to the European Union and to certain other countries in accordance with existing commercialization agreements. While conducting a comprehensive review of the program, and thereafter upon satisfactory completion of its redesign, United Therapeutics will cover the cost of clinical trials, manufacturing and other development expenses for each product. AltaRex will receive development milestone payments and royalties from product sales.

In addition, AltaRex has granted to the United Therapeutics subsidiary a right of first refusal to any products developed or acquired by AltaRex which have applications in the treatment of cancer.

"I am pleased about this agreement because it fits so well with United Therapeutics' strategy of in licensing unique therapeutic products that are in a late-stage of clinical development and show significant promise for addressing unmet medical needs, particularly in orphan indications," said Martine Rothblatt, chairman and CEO of United Therapeutics. "The AltaRex program may fit well with our ongoing assessment of the anti-metastatic properties of our lead drug, Remodulin, which is the subject of growing interest among cancer researchers."

"AltaRex is pleased to have entered into this agreement with United Therapeutics," said Richard Bagley, president and CEO of AltaRex. "We believe that of the proposals that AltaRex had been considering, the collaboration with United Therapeutics represents the best fit and the best value for our shareholders and cancer sufferers, all of whom we expect will share in the success of the Company's oncology products and technology platform. We will continue to build our technology platform, both with United for the cancer field and on our own. Our collaboration with United Therapeutics affords us the opportunity to explore the application of our novel technology to new therapeutic areas. We are also pleased that AltaRex will maintain control of our current oncology product portfolio as it pertains to the European Union market."

As part of this transaction, United Therapeutics purchased 4.9 million common shares of AltaRex, at a premium of ten percent to a predetermined five-day market average, with gross proceeds to AltaRex of approximately $2,450,000 (all dollar amounts herein are stated in U.S. dollars). In addition, AltaRex has issued a nominal ($50,000) convertible debenture to United Therapeutics that is secured by the intellectual property of AltaRex.

AltaRex also has issued United Therapeutics a warrant exercisable at the option of United Therapeutics into an additional 3.25 million common shares of AltaRex for proceeds to AltaRex of $1,625,000.

Further, AltaRex has granted to United Therapeutics a right to purchase a debenture in the principal amount of $875,000. With shareholder approval, $441,690 of the principal amount of the debenture will convert into 883,380 common shares of AltaRex. The right to exercise the warrant and purchase the convertible debenture will expire on August 20, 2002. Assuming exercise of the warrant and conversion of the debenture, United Therapeutics would own approximately 19.9% of the current outstanding common shares of AltaRex. United Therapeutics has also received rights to purchase 19.9% of certain future financings of AltaRex. If United Therapeutics does not exercise the warrant or purchase the debenture, AltaRex may terminate the license agreement.

AltaRex will now focus its business development efforts on seeking collaborators to develop and commercialize its oncology pipeline in Europe and will redirect its discovery efforts to an existing joint collaboration with Epigen and to certain new therapeutic areas.