European Commission Grants Orphan Medicinal Product Designation to Increlex for the Treatment of Primary IGFD

Tercica, Inc. (Nasdaq:TRCA) today announced that theEuropean Commission has granted Increlex(TM) (mecasermin (rDNA origin)injection) orphan medicinal product status for the treatment ofprimary insulin-like growth factor-1 deficiency (Primary IGFD) due tomolecular or genetic defects. This orphan medicinal product statusgrants Tercica market exclusivity in the European Union (EU) for 10years after marketing approval, during which directly competitivesimilar products cannot normally be placed on the market. Thisdesignation is based on a recommendation from the Committee for OrphanMedicinal Products (COMP) of the European Medicines Agency (EMEA).

"We are pleased with the orphan product designation granted toIncrelex by the European Commission," said John A. Scarlett, M.D.,President and Chief Executive Officer of Tercica. "We look forward tobringing this new treatment option to children in the EU and continueto target a 2007 launch of Increlex in the EU, subject to timelyregulatory approval."

Increlex was approved for severe Primary IGFD by the US Food andDrug Administration (FDA) on August 30, 2005, and has received orphandrug exclusivity in the US for this indication.

European Union Orphan Drug Designation

The goal of EU orphan drug designation is to advance theinnovation of drugs that are developed to treat, prevent, or diagnosediseases or conditions that affect no more than five in 10,000 personsin the European Union.

About Tercica

Tercica, Inc. is a biopharmaceutical company focused on thedevelopment and commercialization of products to improve endocrinehealth. The company's first product, Increlex(TM), or recombinanthuman insulin-like growth factor-1 (rhIGF-1), is approved by the FDAfor the treatment of severe Primary IGFD. For further information onTercica, please visit www.tercica.com.

Safe Harbor Statement

Except for the historical statements contained herein, this pressrelease contains forward-looking statements, including withoutlimitation, the statement that Tercica continues to target a Europeanlaunch of Increlex(R) in 2007, subject to timely regulatory approval.Because Tercica's forward-looking statements are subject to risks anduncertainties, there are important factors that could cause actualresults to differ materially from those in the forward-lookingstatements. These factors include without limitation those risks anduncertainties disclosed from time to time in reports filed by Tercicawith the SEC, most recently Tercica's Form 10-Q filed on May 10, 2006and Form 10-K filed on March 16, 2006 and other factors including thatIncrelex may not be approved by the EMEA, and even if approved, it maynot be approved for severe Primary IGFD or Primary IGFD. Thesestatements are based on information as the date of this press release.Tercica assumes no obligation to update any forward-lookingstatements.