GTCB and OVATION Pharmaceuticals, Inc. (“OVATION”) have entered into a collaboration agreement to develop and market ATryn® in the United States. ATryn® is GTC’s recombinant form of human antithrombin, a plasma protein with anticoagulant and anti-inflammatory properties. The agreement includes $257 million in potential payments to GTC for meeting clinical, regulatory, and sales milestones.

OVATION is a fast-growing biopharmaceutical company that develops, manufactures and markets medically necessary therapies to satisfy unmet medical needs for patients with severe illnesses. GTC Biotherapeutics develops, supplies, and commercializes therapeutic proteins produced through transgenic animal technology. In addition to ATryn®, GTC is developing a portfolio of recombinant human plasma proteins with known therapeutic properties.

The collaboration includes development and commercialization of ATryn® in the hereditary antithrombin deficiency, or HD, indication. The milestone payments include a total of $9 million through approval of ATryn® for HD in the U.S., including $3 million paid upon closing and an additional $2 million expected to be received in 2008. The collaboration also plans for further development in larger market acquired antithrombin deficiencies such as the treatment of heparin resistance in patients undergoing surgery requiring cardiopulmonary bypass and the treatment of disseminated intravascular coagulation associated with severe sepsis.

GTC will be responsible for production of ATryn® and will receive a transfer price on commercial product, a royalty on net sales, and a payment for product used in clinical trials. As the collaboration proceeds with the acquired deficiencies, OVATION will fund GTC’s anticipated costs of clinical development. OVATION will be responsible for sales and marketing of ATryn® in the U.S., including all launch activities.

ATryn® has already been granted both Orphan Drug designation and Fast Track status for HD by the U.S. Food and Drug Administration. GTC has submitted the first part of a rolling Biologics License Application, or BLA, for the use of ATryn® in preventing deep vein thrombosis in HD patients undergoing high risk surgical procedures and in childbirth. Filing of the second and final part of this BLA submission is planned for the third quarter. Assuming GTC’s request for priority review is granted, a decision on market approval by the FDA is anticipated in the first quarter of 2009.

ATryn® has been approved for use in the European Union for HD patients undergoing surgical procedures. LEO Pharma A/S is commercializing and developing ATryn® in Europe. LEO is already conducting a phase II dose ranging study of ATryn® as a potential treatment for DIC associated with severe sepsis. GTC will have access to LEO’s European phase II study results for use in clinical and regulatory development in the U.S., which is estimated to be a $2 to 3 billion market. An international phase III program is anticipated, in which LEO Pharma and OVATION will share clinical development costs required for approval for this indication in the U.S. and Europe.

OVATION and GTC also expect to develop ATryn® as a supplement to restore heparin responsiveness in heparin resistant patients. Coronary artery bypass graft and related surgeries where a cardiopulmonary bypass machine, or CPB, is used requires that patients are anticoagulated prior to going on bypass, in order to avoid clot formation. Heparin is used to prevent the formation of blood clots in the CPB. Heparin’s ability to prevent clotting depends on the presence of sufficient antithrombin in the bloodstream to achieve the desired anticoagulant effect. Over 20 percent of patients in CPB related surgeries exhibit heparin resistance. GTC has conducted studies related to this indication and one or more additional clinical trials may be required to obtain FDA approval.