Axonyx and TorreyPines Therapeutics Announce Merger Agreement; Transaction Creates Robust Portfolio in the CNS Disease Area

Under terms of the agreement, unanimously approved by both boardsof directors, Axonyx would issue, and TorreyPines stockholders wouldreceive, in a tax-free transaction, shares of Axonyx common stock suchthat TorreyPines stockholders would own approximately 58% of thecombined company and Axonyx stockholders would own approximately 42%.These relative percentages will be adjusted if either partyout-licenses one or more product candidates prior to closing. Inaddition, TorreyPines preferred shareholders will receive warrants topurchase combined company shares that, if fully exercised at closing,would give TorreyPines shareholders approximately 62% of the combinedcompany. The transaction is subject to Axonyx maintaining certainminimum cash levels, as well as certain other customary conditions,including obtaining approval of each company's stockholders. Thetransaction is expected to close during the fourth quarter of thisyear. Upon closing, the company is expected to trade on the NASDAQStock Market for which the company has reserved the symbol "TPTX."

The combined company will have a deep, robust and diversified CNSpipeline focused on novel therapeutics for neurological diseases anddisorders. At March 31, 2006, the pro forma combined company had morethan $80 million in cash. The combined company's initial focus will beon migraine, chronic pain and Alzheimer's disease (AD). The pipelineat closing will include eight product candidates, with two candidatesfor pain and six for AD. The companies anticipate several keymilestones related to their product candidates during the next 12months. Among these include the following:

-- TorreyPines' lead product candidate for chronic pain, tezampanel, is expected to enter into a Phase IIb clinical trial for the treatment of migraine.

-- TorreyPines expects to file an Investigational New Drug (IND) application with the U.S. Food and Drug Administration (FDA) and initiate a Phase I trial for NGX426, an oral prodrug of tezampanel, and a follow-on compound for migraine and chronic pain.

-- Axonyx will complete its ongoing Phase I trials with Posiphen(TM) in development for the treatment of AD progression.

-- Data will become available from TorreyPines' Phase I single dose study evaluating the company's lead AD product candidate, NGX267, a muscarinic or M1 receptor agonist, in healthy elderly volunteers. In addition, the company anticipates initiating a Phase I multiple dose trial with the compound.

-- Axonyx to begin a Phase I clinical trial with BNC, its highly selective butyrylcholinesterase inhibitor for the treatment of severe AD.

The combined pipeline also includes Phenserine, Axonyx's leadcompound for AD, which is in Phase III clinical development. Thecombined company plans to make Phenserine available to third partiesfor licensing.

"This merger will create a premier biopharmaceutical company withdevelopment and discovery capabilities across the CNS spectrum," saidNeil Kurtz, M.D., President and Chief Executive Officer ofTorreyPines. "This joining of two exciting and complementary pipelinesunder one roof, with substantial financial assets to support continuedefforts toward commercialization, should be a 'win-win' situation forthe shareholders of both companies. This transaction truly bringstogether all of the necessary ingredients for a successfulbiopharmaceutical company: a notable pipeline of multiple productopportunities; proven clinical development and discovery capabilitiesto fuel ongoing product development; and strong financial resources.We plan to review all development opportunities with the goal ofprioritizing the best opportunities while maintaining a reasonableburn rate."

"This transaction meets one of Axonyx's key strategic businessobjectives: to grow and strengthen our company in the area of CNS,"said Gosse B. Bruinsma, M.D., President and Chief Executive Officer ofAxonyx. "By combining with TorreyPines, our shareholders will benefitfrom a stronger company that remains wholly dedicated to becoming aleading biopharmaceutical company in the area of CNS. The merger withTorreyPines brings with it a broad pipeline that currently hasmultiple and complementary clinical programs underway in AD, as wellas programs in migraine and chronic pain. TorreyPines' management teamhas significant drug development expertise and their experience andinfrastructure will, in my opinion, provide an excellent opportunityto continue to move our product candidates toward potential approval."

Products in or nearing clinical development will include:

Tezampanel: TorreyPines' lead product candidate is a novel,parenteral compound for the treatment of chronic pain. Tezampanel isan AMPA/kainate (AK) receptor antagonist, offering a non-opioid,non-vascular approach to the management of migraine and other chronicpain states and represents a potentially promising alternative tocurrent treatments. Two Phase I trials and five Phase IIa trials havebeen completed with tezampanel and TorreyPines plans to move forwardwith a Phase IIb clinical trial for the treatment of migraine.

NGX426: TorreyPines' follow-on compound for chronic pain is anoral prodrug of tezampanel. TorreyPines plans to file an IND forNGX426 with the FDA and initiate a Phase I study. Both NGX426 andtezampanel may effectively relieve migraine and chronic pain through anovel mechanism that may not impart the side effects and risksassociated with currently available migraine and other paintreatments.

NGX267: TorreyPines' lead AD product is a muscarinic or M1receptor agonist. The M1 receptor plays an important role in memoryand cognitive processing. Its activation has also been linked to adecrease in beta amyloid 1-42 (A beta 42) production, a peptide thatis involved in the creation of the amyloid plaques that are hallmarksof AD. NGX267 has completed a Phase I single dose study in healthymales and a second single dose study in healthy elderly volunteers.TorreyPines plans to initiate a Phase I multiple dose safety study.

Phenserine: Axonyx's lead compound for AD, Phenserine has a dualmechanism of action: acetylcholinesterase inhibition and the loweringof A beta 42. Acetylcholinesterase is an enzyme active in the nervesynapse that degrades the neurotransmitter acetylcholine in the brainand other tissues of the body. Phenserine's dual mechanism of actionsuggests that it has the potential to improve memory and cognition aswell as slow disease progression. Phenserine was evaluated in a PhaseIII trial where the observed improvement in memory and cognition didnot achieve statistical significance over placebo. Phenserine has beenlicensed to Daewoong for commercialization in South Korea and Axonyxis seeking strategic partners for Phenserine in other markets.

Posiphen(TM): Axonyx's Phase I compound has consistently beenshown to significantly reduce the levels of A beta 42 in preclinicalanimal studies. It is believed that Posiphen's mechanism of action isthrough RNA translational inhibition and it is currently indevelopment as a potential treatment to slow or prevent theprogression of AD.

There are also three preclinical candidates in the pipeline: twoTorreyPines compounds, targeted for the treatment of AD are afollow-on M1 agonist, NGX292, and NGX555, a gamma-secretase modulatordiscovered by TorreyPines; and Axonyx's butyrylcholinesteraseinhibitor Bisnorcymserine (BNC) for the potential symptomatictreatment of severe AD.

Management and Organization

Following the closing of the transaction, Dr. Neil Kurtz,President and Chief Executive Officer of TorreyPines will becomePresident and Chief Executive Officer of the combined company. EvelynGraham, currently Vice President, Corporate Development of TorreyPineswill become the company's Chief Operating Officer; and Craig Johnson,currently Chief Financial Officer, Dr. Michael Murphy, currently ChiefMedical Officer and Dr. Steven Wagner, currently Chief ScientificOfficer of TorreyPines will retain their respective positions in thecombined entity. The combined company's Board of Directors is expectedto consist of a total of five current TorreyPines directors and threecurrent Axonyx directors.

Piper Jaffray & Co. served as financial advisor to TorreyPines.Banc of America Securities LLC served as financial advisor to Axonyx.

Conference Call/Webcast Information

Axonyx and TorreyPines management will host a joint conferencecall/webcast to discuss matters mentioned in this release. The audiowebcast with slides is scheduled for today, June 8, at 9:00 a.m.Eastern Time and can be accessed at the Axonyx corporate website atwww.axonyx.com. Please note that this call/webcast will not include aquestion and answer session; shareholders and interested parties aretherefore encouraged to view the audio/slide webcast. The audio/slidewebcast will be archived for six months through December 6, 2006.

To listen to the call by telephone, parties may alternatively dial(877) 660-6853 or (201) 612-7415, account number: 286; confirmationidentification: 205355 beginning at 9:00 a.m. ET to access the audioportion of the presentation. The related slide presentation can bedownloaded for review at www.axonyx.com. In addition, a telephonicarchive will be available through June 20, 2006.

Additional Information about the Merger and Where to Find It

In connection with the Merger, Axonyx and TorreyPines Therapeuticsintend to file relevant materials with the Securities and ExchangeCommission (SEC), including a registration statement on Form S-4 thatwill contain a prospectus and a joint proxy statement. Investors andsecurity holders of Axonyx and TorreyPines Therapeutics are urged toread these materials when they become available because they willcontain important information about Axonyx, TorreyPines Therapeuticsand the merger. The proxy statement, prospectus and other relevantmaterials (when they become available), and any other documents filedby Axonyx with the SEC, may be obtained free of charge at the SEC'sweb site at www.sec.gov. In addition, investors and security holdersmay obtain free copies of the documents filed with the SEC by Axonyxby directing a written request to: Axonyx, 500 Seventh Avenue, 10thFloor, New York, NY 10018, Attention: Investor Relations. Investorsand security holders are urged to read the proxy statement, prospectusand the other relevant materials when they become available beforemaking any voting or investment decision with respect to the merger.

This communication shall not constitute an offer to sell or thesolicitation of an offer to sell or the solicitation of an offer tobuy any securities, nor shall there be any sale of securities in anyjurisdiction in which such offer, solicitation or sale would beunlawful prior to registration or qualification under the securitieslaws of any such jurisdiction. No offering of securities shall be madeexcept by means of a prospectus meeting the requirements of Section 10of the Securities Act of 1933, as amended.

Participants in the Solicitation

Axonyx and its directors and executive officers and TorreyPinesTherapeutics and its directors and executive officers may be deemed tobe participants in the solicitation of proxies from the stockholdersof Axonyx in connection with the proposed transaction. Informationregarding the special interests of these directors and executiveofficers in the merger transaction will be included in the proxystatement/prospectus referred to above. Additional informationregarding the directors and executive officers of Axonyx is alsoincluded in Axonyx's Annual Report on Form 10-K for the year endedDecember 31, 2005, which was filed with the SEC on March 16, 2006.This document is available free of charge at the SEC's web site(www.sec.gov) and from Investor Relations at Axonyx at the addressdescribed above.

About TorreyPines Therapeutics

TorreyPines Therapeutics, Inc. is a biopharmaceutical company thatdiscovers and develops small molecule drugs to treat diseases anddisorders of the central nervous system. Led by an accomplishedmanagement team, TorreyPines is leveraging novel drug targets andtechnologies to deliver new therapies for migraine; chronic pain,including neuropathic pain; and Alzheimer's disease. Its therapies areintended to offer significant advantages over current therapies.Further information is available at www.torreypinestherapeutics.com.

About Axonyx

Axonyx Inc. is a U.S.-based biopharmaceutical company engaged inthe acquisition and development of proprietary pharmaceuticalcompounds for the treatment of CNS disorders. Axonyx currently hasthree compounds in development for Alzheimer's disease, namelyPhenserine - a potential symptomatic and disease progression treatmentof mild to moderate Alzheimer's disease (AD), Posiphen(TM) - apotential disease progression treatment for AD now in Phase I, andBisNorCymserine (BNC) - a potential symptomatic treatment of severe ADnow in pre-Investigational New Drug (IND) stage. Additionalinformation can be found at www.axonyx.com.

This press release contains forward-looking statements orpredictions, including statements regarding the potential closing ofthe proposed merger between Axonyx and TorreyPines Therapeutics, thetrading of the combined company's stock on the NASDAQ Stock Market,the amount of cash expected to be held by the combined company atclosing, the timing for anticipated occurrence of key milestonesrelated to each company's product candidates, the characteristics andpossible uses of the product candidates of each of Axonyx andTorreyPines Therapeutics, the expected advantages of combining Axonyxand TorreyPines Therapeutics, and the expected timing of closing ofthe merger. Actual results may differ materially from the aboveforward-looking statements due to a number of important factors,including the possibility that the proposed transaction withTorreyPines Therapeutics may not ultimately close for any of a numberof reasons, including, but not limited to, Axonyx not obtainingshareholder approval of the issuance of shares and warrants in themerger, the change in control resulting from the merger or the reversesplit of Axonyx common stock; TorreyPines Therapeutics not obtainingshareholder approval of the merger, the possibility that NASDAQ willnot approve the listing of the combined company's shares for tradingon the NASDAQ Stock Market or that the combined company will not beable to meet the continued listing requirements after the closing ofthe merger; that Axonyx and TorreyPines Therapeutics will foregobusiness opportunities while the merger is pending; that prior to theclosing of the proposed transaction, the businesses of the companies,including the retention of key employees, may suffer due touncertainty; and even in the event the transaction is completed, thatcombining Axonyx and TorreyPines Therapeutics may not result in astronger company, that the technologies and clinical programs of thetwo companies may not be compatible and that the parties may be unableto successfully execute their integration strategies or realize theexpected benefits of the merger.

This press release may contain forward-looking statements orpredictions. These statements represent our judgment to date, and aresubject to risks and uncertainties that could materially affect theCompany, including those risks and uncertainties described in thedocuments Axonyx files from time to time with the SEC, specificallyAxonyx's annual report on Form 10-K. Specifically, with respect to ourdrug candidates Phenserine, Posiphen(TM) and BisNorCymserine, Axonyxcannot assure that: any preclinical studies or clinical trials,whether ongoing or conducted in the future, will prove successful, andif successful, that the results can be replicated; safety and efficacyprofiles of any of its drug candidates will be established, or ifestablished, will remain the same, be better or worse in futureclinical trials, if any; pre-clinical results related to cognition andthe regulation of beta-APP will be substantiated by ongoing or futureclinical trials, if any, or that any of its drug candidates will beable to improve the signs or symptoms of their respective clinicalindication or slow the progression of Alzheimer's disease; any of itsdrug candidates will support an NDA filing, will be approved by theFDA or its equivalent, or if approved, will prove competitive in themarket; or that Axonyx will have or obtain the necessary financing tosupport its drug development programs. Axonyx cannot assure that itwill be successful with respect to identifying a (sub-) licensingpartner for any of its compounds. Axonyx undertakes no obligation topublicly release the result of any revisions to such forward-lookingstatements that may be made to reflect events or circumstances afterthe date hereof or to reflect the occurrence of unanticipated events.