Bayer and Aventis Discontinue Joint Venture Discussions

Biological Products Division
Bayer Corporation
79 T.W. Alexander Drive
4101 Research Commons
Post Office Box 13887
RTP, NC 27709

January 31, 2003

Dear Alpha-1 Community:

I’m writing to let you know that, after reviewing various possible forms of cooperation, we have been unable to reach a final agreement on the terms of a proposed joint venture with Aventis Behring. I want to first emphasize that Bayer Biological Products is poised to move forward successfully in 2003 and beyond, without the joint venture.

Know that Bayer remains committed to the biological products industry and will continue to dedicate technologies and intellectual resources to extending and enhancing the lives of patients who rely on our products. Our long-standing commitment to the Alpha-1 community is unwavering, and you can continue to expect the highest level of service and support from us.

Our efforts to provide reliable supplies of Prolastin® remain a top priority. Patients taking Prolastin® can continue to count on the outstanding services provided by Bayer Direct™. As always, a continued focus will be placed on achieving and maintaining the highest levels of manufacturing compliance to maximize product availability.

Additionally, Bayer has secured an ample supply of plasma to meet production requirements for Prolastin®. We have several long-term agreements in place with suppliers, and we will build on those relationships to ensure continued supply of Prolastin®.

And rest assured that the decision not to pursue the joint venture does not affect any of our ongoing research efforts or partnerships. Our collaboration with PPL Therapeutics continues with the goal of developing a transgenically produced recombinant form of Alpha-1 antitrypsin replacement therapy delivered via a unique inhalation device.

A press release outlining this announcement is available online at www.bayerbiologicals.com, titled “Bayer BP Poised for Strong Future.” Thank you for your continued support. As always, please feel free to call me if you have any questions at 203/812-6392.

Sincerely,

Terry Tenbrunsel
Vice President
Sales & Marketing, Biological Products