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Rigel Moves First Drug into Clinical Testing

Company Plans to Have Two More Products in the Clinic Within 18 Months

SOUTH SAN FRANCISCO, CA, - September 18, 2002

Rigel Pharmaceuticals, Inc. (Nasdaq: RIGL) has begun phase I clinical testing of the company’s first product, a drug to treat allergic rhinitis. With this milestone, Rigel builds on its developing leadership position in the genomics industry, becoming one of only a small number of companies that have begun to turn the genomics revolution into therapeutic reality.

Rigel’s new compound, designated R112, inhibits the activation of a type of blood cell called mast cells. Mast cell activation is one of the earliest steps in the initiation of an inflammatory response in allergy and asthma. Rigel anticipates that R112, being tested for intranasal administration, would be used to treat chronic allergic rhinitis, the ongoing nasal stuffiness and congestion experienced by many allergy sufferers. Although the market potential for this indication is great, with sales of some inhaled drugs approaching $2 billion annually, no other drugs now available or in human testing specifically target this important mast cell pathway.

“This is a completely new approach to intervening in the allergic process,” said Elliott Grossbard, MD, Rigel’s senior vice president of medical development. “The drugs currently available for this indication are predominantly steroids. We believe that by going after mast cells, we can match the effectiveness and reduce the side effects associated with current therapies.”

The first-in-man feasibility and safety study for R112 is being conducted in the United Kingdom. Rigel will incorporate the results from this phase of evaluation into the company’s U.S. Investigational New Drug (IND) application, which Rigel plans to file with the Food and Drug Administration later this year.

Internal R&D Success

R112 is a product of Rigel’s own compound development program. The company uses advanced, proprietary functional genomics technology to pinpoint specific targets within cells that play a role in a particular type of disease, in this case allergy and asthma. The company then employs its own biology and chemistry labs to create drug libraries to address these targets.

“From concept to the clinic, this drug is entirely Rigel’s,” Dr. Grossbard noted. “It really demonstrates proof-of-concept of our scientific and technologic approach to drug discovery and development.”

By moving R112 into the clinic, Rigel has shown that it is ahead of the pack of genomics companies focused on developing human pharmaceuticals, many of which began working in this field years before Rigel. The start of human testing is also significant because it reinforces Rigel’s consistent success in executing on the company’s stated goals.

“As we see it, the move into the clinic at this time really distinguishes Rigel from most of our peers,” said James Gower, the company’s chief executive officer. “Not only are we among the first to deliver on the genomics revolution in terms of generating potential therapies, we’ve also done it in a relatively short amount of time within our corporate history and we’ve done it within the timeline we promised.”

Portfolio Drug Development

Rigel is pursuing a business strategy that is novel among young biotech companies. Rather than prosecute a single drug through full clinical testing and marketing, as many early-stage companies do, Rigel intends to develop a portfolio of compounds through mid-stage (phase II) research to the point where initial clinical safety and effectiveness have been demonstrated. With these data in hand, a compound becomes much more valuable as a licensing opportunity. Rigel would then seek a commercialization partner to undertake the drug’s remaining clinical development and marketing.

“Through our portfolio approach, we believe that we can develop five or more products for the same cost of taking one product through the full research, regulatory and marketing process,” Mr. Gower said. “This strategy significantly increases the efficiency and reduces the risk of our drug development program.”

Rigel currently has three proprietary lead research programs underway from which the company plans to develop its next drugs. These are focused in the areas of asthma/allergy, hepatitis C, and a new type of cancer drug target called ligases. Rigel expects to move two more drugs from these programs into clinical testing within the next 18 months.

Rigel will present a complete overview of the company’s clinical development program at the Atkins and Associates Biotech/Medtech conference on Wednesday, September 25, 2002, at 4:30 p.m. at the Hyatt Regency San Francisco.

About Rigel (www.rigel.com)

Rigel’s mission is to become a source of novel, small-molecule drugs to meet large, unmet medical needs. The company’s business model is to develop a portfolio of drug candidates and to take these through phase II clinical trials, after which Rigel intends to seek commercialization partners for completion of clinical evaluation, regulatory approval and marketing. Rigel has identified three areas for its lead product research programs: mast cell activation to treat asthma/allergy, an antiviral agent to treat hepatitis C and ubiquitin ligases for cancer. Rigel has begun clinical testing of its first product, for allergic rhinitis, and plans to follow that with two additional drugs in the clinic within 18 months. Rigel’s approach to drug discovery is based on advanced, proprietary functional genomics techniques that allow the company to identify targets with a demonstrable role in a disease pathway and to efficiently screen for those that are likely to be amenable to drug modulation.

This press release contains "forward-looking" statements, including statements related to Rigel’s business strategy, drug development programs and clinical trial plans. Any statements contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Words such as “believes,” “anticipates,” “plans,” “intends,” “expects,” “will” and similar expressions are intended to identify forward-looking statements. There are a number of important factors that could cause our results to differ materially from those indicated by these forward-looking statements, including the risks detailed from time to time in Rigel’s SEC reports, including its Annual Report on Form 10-K for the year ended December 31, 2001. Rigel does not undertake any obligation to update forward-looking statements.

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