Hybridon Converts $7.6 Million Loan and Sells Shares in MethylGene

- Part of Refinancing Strategy Designed to Renew Financial Strength -



Apr 03, 2001, 01:00 ET from Hybridon, Inc.

    CAMBRIDGE, Mass., April 3 /PRNewswire/ -- Hybridon
 (OTC Bulletin Board:   HYBN) today announced the conversion of $7.6 million of
 its 8% secured senior notes into preferred equity, which represents more than
 90% of the outstanding amount of notes issued by the Company in December 1999.
 Hybridon also announced that it has entered into an agreement whereby private
 US institutional investors will purchase 60% of its holding of MethylGene,
 Inc., a Canadian pharmaceutical research company in which Hybridon currently
 holds a 22% interest.
     "The completion of these transactions will substantially improve our
 balance sheet," said Robert Andersen, Chief Financial Officer of Hybridon.
 "The combined positive effect of these developments will range from $11.9
 million to $14.7 million. These additional resources will help our Company to
 apply its leadership in DNA chemistry to development programs and subsequent
 partnership opportunities."
     The conversion was effected through an exchange offer which concluded on
 March 31, 2001.  The noteholders accepting the offer agreed to exchange their
 notes for shares of a newly created Series B Preferred Stock which are
 convertible into common stock. The exchange offer will allow $5 million of
 cash currently securing payment of the senior notes to be released to the
 company.
     As part of the MethylGene sale, Hybridon reached an agreement with the
 holders of its $6 million convertible loan to pay down between 30% and 50% of
 the loan, depending on the total number of MethylGene shares actually sold.
 The conversion rate on the balance of the loan has also been reduced from
 $2.40 to $1.50 per share of common stock.
     "The overwhelming acceptance of the exchange offer that we launched in
 early March is a testimony to the confidence that the lenders of Hybridon have
 in the future success of the company. We believe that this confidence is
 justified, based on the strength and diversity of our DNA chemistry technology
 which has potential applications in the fields of antisense, functional
 genomics and novel CpG-based immune stimulation," commented James Wyngaarden,
 M.D., Chairman of Hybridon.
     Under the terms of the agreement with the institutional investors,
 Hybridon will sell its holdings in MethylGene for $2.85 (Can) or approximately
 $1.81 (US) per share. Additionally, Hybridon has granted MethylGene and other
 MethylGene shareholders an option to purchase Hybridon's remaining 9% of
 MethylGene shares.  These shares will be offered on similar terms to those
 agreed to by the institutional investors.  If all shares are sold under these
 agreements, Hybridon will receive proceeds of approximately $7.1 million
 (U.S.). The sale of Hybridon's MethylGene shares is subject to receipt of
 consents from MethylGene's other shareholders.
     "These financial transactions are part of a larger strategy designed to
 provide the Company with the financial strength to proceed with the clinical
 and commercial development of our three breakthrough platform technologies,"
 continued Dr. Wyngaarden.
 
     Located in Cambridge, MA, Hybridon, Inc. is engaged in the discovery and
 development of novel genetic medicines based primarily on antisense technology
 for the treatment of diseases for which there are currently limited or no
 effective treatments. Antisense technology involves the use of synthetic
 segments of DNA to inhibit the production of disease-associated proteins by
 interacting at the genetic level with target strands of messenger RNA.
 Hybridon's lead compound, the advanced chemistry antisense oligonucleotide
 GEM(R)231, is currently in Phase II clinical trials for the treatment of solid
 tumors. Hybridon has also designed a portfolio of novel CpG oligonucleotides
 for use as immunostimulatory agents.  In addition, Hybridon also has two
 spinouts, MethylGene, Inc. and OriGenix Technologies Inc., in which it
 currently holds minority ownership positions. For more detailed information
 about Hybridon, please visit the website at http://www.hybridon.com.
 
     The statements made in this press release contain certain forward-looking
 statements within the meaning of Section 21E of the Securities Exchange Act of
 1934, that involve a number of risks and uncertainties, including the risks
 that the results obtained in cell culture or preclinical studies may not be
 indicative of results obtained in future studies or in clinical trials, that
 Hybridon's antisense drugs or any oral formulation thereof may be ineffective
 or may not receive required regulatory approvals, or may not be profitable or
 that the company will be forced to cease operations due to the lack of
 sufficient funding. Such statements are only predictions and actual events or
 results may differ materially.  In addition to the matters described in this
 press release, risk factors as stated from time to time in Hybridon's SEC
 reports, including but not limited to, its Annual Report on Form 10-K, may
 affect the results achieved by Hybridon.
 
     This and other Hybridon press releases can be found at
 http://www.hybridon.com and http://www.noonanrusso.com.
 
     Contact:  Robert G. Andersen, Vice President of Operations and Planning,
 Chief Financial Officer of Hybridon, Inc., 617-679-5500, ext. 5517,
 randersen@hybridon.com; or media - Stephen Gendel, 212-696-4455, ext. 212, or
 investors - Matthew Orsagh, 212-696-4455, ext. 357, both of Noonan-Russo
 Communications, Inc.
 
 

SOURCE Hybridon, Inc.
    CAMBRIDGE, Mass., April 3 /PRNewswire/ -- Hybridon
 (OTC Bulletin Board:   HYBN) today announced the conversion of $7.6 million of
 its 8% secured senior notes into preferred equity, which represents more than
 90% of the outstanding amount of notes issued by the Company in December 1999.
 Hybridon also announced that it has entered into an agreement whereby private
 US institutional investors will purchase 60% of its holding of MethylGene,
 Inc., a Canadian pharmaceutical research company in which Hybridon currently
 holds a 22% interest.
     "The completion of these transactions will substantially improve our
 balance sheet," said Robert Andersen, Chief Financial Officer of Hybridon.
 "The combined positive effect of these developments will range from $11.9
 million to $14.7 million. These additional resources will help our Company to
 apply its leadership in DNA chemistry to development programs and subsequent
 partnership opportunities."
     The conversion was effected through an exchange offer which concluded on
 March 31, 2001.  The noteholders accepting the offer agreed to exchange their
 notes for shares of a newly created Series B Preferred Stock which are
 convertible into common stock. The exchange offer will allow $5 million of
 cash currently securing payment of the senior notes to be released to the
 company.
     As part of the MethylGene sale, Hybridon reached an agreement with the
 holders of its $6 million convertible loan to pay down between 30% and 50% of
 the loan, depending on the total number of MethylGene shares actually sold.
 The conversion rate on the balance of the loan has also been reduced from
 $2.40 to $1.50 per share of common stock.
     "The overwhelming acceptance of the exchange offer that we launched in
 early March is a testimony to the confidence that the lenders of Hybridon have
 in the future success of the company. We believe that this confidence is
 justified, based on the strength and diversity of our DNA chemistry technology
 which has potential applications in the fields of antisense, functional
 genomics and novel CpG-based immune stimulation," commented James Wyngaarden,
 M.D., Chairman of Hybridon.
     Under the terms of the agreement with the institutional investors,
 Hybridon will sell its holdings in MethylGene for $2.85 (Can) or approximately
 $1.81 (US) per share. Additionally, Hybridon has granted MethylGene and other
 MethylGene shareholders an option to purchase Hybridon's remaining 9% of
 MethylGene shares.  These shares will be offered on similar terms to those
 agreed to by the institutional investors.  If all shares are sold under these
 agreements, Hybridon will receive proceeds of approximately $7.1 million
 (U.S.). The sale of Hybridon's MethylGene shares is subject to receipt of
 consents from MethylGene's other shareholders.
     "These financial transactions are part of a larger strategy designed to
 provide the Company with the financial strength to proceed with the clinical
 and commercial development of our three breakthrough platform technologies,"
 continued Dr. Wyngaarden.
 
     Located in Cambridge, MA, Hybridon, Inc. is engaged in the discovery and
 development of novel genetic medicines based primarily on antisense technology
 for the treatment of diseases for which there are currently limited or no
 effective treatments. Antisense technology involves the use of synthetic
 segments of DNA to inhibit the production of disease-associated proteins by
 interacting at the genetic level with target strands of messenger RNA.
 Hybridon's lead compound, the advanced chemistry antisense oligonucleotide
 GEM(R)231, is currently in Phase II clinical trials for the treatment of solid
 tumors. Hybridon has also designed a portfolio of novel CpG oligonucleotides
 for use as immunostimulatory agents.  In addition, Hybridon also has two
 spinouts, MethylGene, Inc. and OriGenix Technologies Inc., in which it
 currently holds minority ownership positions. For more detailed information
 about Hybridon, please visit the website at http://www.hybridon.com.
 
     The statements made in this press release contain certain forward-looking
 statements within the meaning of Section 21E of the Securities Exchange Act of
 1934, that involve a number of risks and uncertainties, including the risks
 that the results obtained in cell culture or preclinical studies may not be
 indicative of results obtained in future studies or in clinical trials, that
 Hybridon's antisense drugs or any oral formulation thereof may be ineffective
 or may not receive required regulatory approvals, or may not be profitable or
 that the company will be forced to cease operations due to the lack of
 sufficient funding. Such statements are only predictions and actual events or
 results may differ materially.  In addition to the matters described in this
 press release, risk factors as stated from time to time in Hybridon's SEC
 reports, including but not limited to, its Annual Report on Form 10-K, may
 affect the results achieved by Hybridon.
 
     This and other Hybridon press releases can be found at
 http://www.hybridon.com and http://www.noonanrusso.com.
 
     Contact:  Robert G. Andersen, Vice President of Operations and Planning,
 Chief Financial Officer of Hybridon, Inc., 617-679-5500, ext. 5517,
 randersen@hybridon.com; or media - Stephen Gendel, 212-696-4455, ext. 212, or
 investors - Matthew Orsagh, 212-696-4455, ext. 357, both of Noonan-Russo
 Communications, Inc.
 
 SOURCE  Hybridon, Inc.