AVANIR Initiates Phase III Clinical Trial of Neurodex for the Treatment of Diabetic Neuropathic Pain

AVANIR Pharmaceuticals (AMEX:AVN) today announced the
initiation of a double-blind, placebo-controlled, multicenter, Phase
III clinical trial of Neurodex(TM) in patients with diabetic
neuropathic pain. The randomized, placebo-controlled study will assess
efficacy, overall safety and tolerability of AVANIR's investigational
drug targeting central nervous system (CNS) receptors to treat
diabetic neuropathic pain.
   The 3-month study will assess the efficacy of Neurodex in
relieving pain in adult patients with distal symmetrical diabetic
neuropathy with daily pain in the lower extremities. The clinical
trial will be conducted at 40 sites in the United States and will
include assessment scales completed in the clinic and diary records to
assess pain. Patients will be randomized to receive placebo or one of
two dose levels of Neurodex.
   The clinical trial protocol was reviewed by the U.S. Food and Drug
Administration (FDA) through a special protocol assessment (SPA)
process. An SPA is a binding agreement between the FDA and the sponsor
of a clinical trial documenting that if the study endpoints are met,
the results should be sufficient to support approval of a New Drug
Application (NDA). AVANIR expects that this will be the first of two
Phase III clinical trials needed to submit an NDA for Neurodex for
this indication.
   "AVANIR is committed to developing and commercializing Neurodex as
the cornerstone of our CNS research and development program," said
James E. Berg, Vice President of Clinical and Regulatory Affairs at
AVANIR. "The results of our previous open-label study of Neurodex in
patients with diabetic neuropathic pain were encouraging, and we are
eager to explore the potential of Neurodex as a treatment for diabetic
neuropathic pain in a larger placebo-controlled study. The goal is to
be able to offer a new treatment option for diabetic patients with
painful neuropathies."
   The results of a four-week Phase II open-label dose escalation
safety study of Neurodex in patients with diabetic neuropathic pain
were reported in November at the 2004 annual meeting of the American
Society of Regional Anesthesia and Pain Medicine. Study data showed
that Neurodex(TM) was well tolerated up to the highest target dose,
and patients reported decreased pain intensity from that reported at
baseline (p less than 0.0001). The degree of pain relief increased
with the duration of the open label study.

   AVANIR Pharmaceuticals is a pharmaceutical company focused on
developing and commercializing novel therapeutic products for the
treatment of chronic diseases. AVANIR's product candidates address
therapeutic markets that include central nervous system and
cardiovascular disorders, inflammation, and infectious disease. AVANIR
is currently in the process of submitting to the FDA a "rolling" new
drug application for Neurodex for the treatment of pseudobulbar affect
and expects to complete the submission by June 30, 2005. Recently,
AVANIR partnered its preclinical research and development program for
inflammatory disease with Novartis. The Company's first commercialized
product, Abreva(R), is marketed in North America by GlaxoSmithKline
Consumer Healthcare and is the leading over-the-counter product for
the treatment of cold sores. Further information about AVANIR can be
found at www.avanir.com.

   Except for the historical information presented herein, matters
discussed in this press release contain forward-looking statements
that are subject to certain risks and uncertainties that could cause
actual results to differ materially from any future results,
performance or achievements expressed or implied by such statements.
Statements that are not historical facts, including statements that
are preceded by, followed by, or that include such words like
"estimate," "anticipate," "believe," "intend," "plan," or "expect" or
similar statements are forward-looking statements. Forward looking
statements include, but are not limited to, risks associates with the
timing of the Company's new drug application for Neurodex, regulatory
decisions by the FDA for the Company's drug candidates, milestones,
and royalties earned from licensees, and results of clinical trials or
product development efforts, as well as risks described in the
Company's most recent Annual Report on Form 10-K and in subsequent
quarterly reports on Form 10-Q and from time-to-time in other publicly
available information regarding the Company. Research findings are not
always supportable by evidence obtained from subsequent clinical
trials, and the Company can make no assurances that the Neurodex
clinical trials will yield positive results. Final review decisions
made by the FDA and other regulatory agencies concerning clinical
trial results are often unpredictable and outside the influence and/or
control of the company. The Company disclaims any intent or obligation
to update these forward-looking statements.