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May 19, 2008 3427 Hillview Avenue Suite 200
Palo Alto, CA 94304

KaloBios Initiates Phase 1/2 Trial of Humaneered™ Monoclonal Antibody KB001 for Treatment of Pseudomonas Infections in Mechanically Ventilated Patients

PALO ALTO, California, May 19, 2008 – KaloBios Pharmaceuticals, Inc., a privately held biopharmaceutical company, today announced the initiation of a Phase 1/2 clinical trial of KB001, a Humaneered™, high-affinity antibody fragment that KaloBios is developing for the treatment of Pseudomonas aeruginosa infections.

The randomized, double-blinded, placebo-controlled trial, which is being conducted at over 10 sites across France, will enroll up to 36 patients in the intensive care setting who are receiving ventilator therapy and who have Pseudomonas infections. They will receive either one of two dose levels of KB001 or placebo. Endpoints for the study include safety, reduction of Pseudomonas bacteria, and progression of pneumonia endpoints.

”This is our first study of KB001 for Pseudomonas infections in the hospital acute care setting, which complements our ongoing Phase 1/2 trial for this product in cystic fibrosis,” said Tillman Pearce, KaloBios’ Chief Medical Officer. “Drug resistant Pseudomonas strains are often found in hospital settings, where patients on mechanical ventilation are particularly susceptible to infection. Such patients are documented in some hospitals to have mortality rates of 25-33%, and studies indicate survivors cost $40,000 more to treat than patients without Pseudomonas. Our targeted approach to Pseudomonas could complement the broad spectrum antibiotics currently being used today to control these infections, and thus address a large unmet medical need.”

Background Information Pseudomonas aeruginosa is an opportunistic pathogen that rarely causes disease in healthy people, but is a significant problem for critically ill or immunocompromised individuals. Experts estimate that there are greater than 100,000 patients in the United States, Europe and Japan where Pseudomonas pneumonia occurs. Patients with Pseudomonas pneumonia currently represent only about 20% of the patients in the hospital who get Pseudomonas infections.

About Humaneering™ KaloBios’ Humaneering™ technology is a proprietary method for converting non-human antibodies into engineered human antibodies. Humaneered™ antibodies are high affinity, but nearer to human germline sequence than is possible with other available antibody engineering methods, making them exquisitely suited for repeated use in the treatment of chronic or other therapies.

About KaloBios
KaloBios Pharmaceuticals, Inc., a U.S. based, private monoclonal company, uses its proprietary platform technology to develop first or best-in-class human antibody therapeutics. The company has multiple programs that are in six Phase 1 or 2 clinical trials: KB001 is an anti-infective for Pseudomonas aeruginosa infections being tested in cystic fibrosis and in intensive care patients on a ventilator, and KB002 and KB003 are being evaluated in inflammatory conditions such as rheumatoid arthritis and asthma. The company’s Humaneering™ technology offers advantages over other methods of human antibody creation in terms of immunogenicity, potency, and manufacturing yields. For more information, visit www.kalobios.com.

Contact: Media Contact:
David W. Pritchard
President and CEO
KaloBios Pharmaceuticals, Inc.
(650) 843-1897
Joan E. Kureczka
Kureczka/Martin Associates
(415) 821-2413