Issued — Tuesday 23 October 2007, London, UK and Cambridge, MA

Collaboration focuses on type 1 diabetes and other autoimmune indications

GlaxoSmithKline and Tolerx, Inc. today announced the execution of a worldwide alliance to develop and commercialise otelixizumab (TRX4), a novel humanised anti-CD3 monoclonal antibody that has potential across a broad range of autoimmune and immune-mediated inflammatory diseases, including type 1 diabetes. Otelixizumab has been evaluated in type 1 diabetes in two Phase II studies and in psoriasis in two Phase I studies. In clinical trials, otelixizumab has been shown to preserve the function of insulin-producing beta cells in the pancreas in patients with type 1 diabetes, reducing the amount of administered insulin needed to control blood glucose levels.

Under the terms of the agreement, Tolerx will have responsibility for the Phase III clinical programme for type 1 diabetes in the US up to and including regulatory submission of the biologics license application (BLA). Tolerx has the option to co-promote otelixizumab in type 1 diabetes in the US with GSK, while GSK will have exclusive rights to develop and commercialise otelixizumab in all other indications in the rest of the world. GSK also has the exclusive right to develop the paediatric indication for type 1 diabetes in the US.

As part of the collaboration, Tolerx will receive an upfront payment, equity and advance R&D funding totaling $70 million. In addition, Tolerx may receive up to $155 million in future development costs of otelixizumab in type 1 diabetes. Tolerx may earn up to $350 million in milestone payments, assuming successful development and approvals of otelixizumab for type 1 diabetes and multiple additional indications. Tolerx may also receive up to $175 million in sales milestone payments based on tiered net sales thresholds of otelixizumab. Tolerx will be entitled to receive tiered, double-digit royalty payments on worldwide sales of otelixizumab in all indications. At the time of an initial public offering of Tolerx’s common stock and at the request of Tolerx and certain other conditions, GSKwill invest up to an additional $10 million in Tolerx’s common stock.

Dr. Moncef Slaoui, Chairman of Research and Development at GSK, commented, “Otelixizumab is another welcome addition to GSK’s rapidly expanding biopharmaceuticals pipeline. This is a key area of future growth and investment for GSK and, as a novel treatment for many T cell-mediated diseases, the potential of otelixizumab is significant. Together with Tolerx, who are pioneers in this area of science, we hope to realise the potential of this compound and bring a valuable new treatment option to patients suffering from type 1 diabetes and other autoimmune disorders.”

"GSK brings a wealth of experience, expertise, and global resources to this collaboration. The agreement with GSK enables us to operationally leverage Tolerx’s expertise in therapeutic immune regulation, expand the development of otelixizumab in type 1 diabetes and other indications, and capitalize on GSK’s considerable worldwide development, regulatory, and commercialisation infrastructure and experience,” said Dr. Douglas J. Ringler, President and Chief Executive Officer of Tolerx. “Moreover, it provides the infrastructural support required to advance our goal of being first-to-market with otelixizumab in type 1 diabetes. We anticipate the collaboration will allow the potential of this novel therapy to be fully explored globally, not only for the treatment of patients with type 1 diabetes but also for those with autoimmune disorders for which the current standard of care is inadequate.”

About type 1 diabetes

Diabetes (medically known as diabetes mellitus) is the name given to disorders in which the body has difficulty regulating its blood glucose, or blood sugar levels. There are two major types of diabetes: type 1 and type 2. Type 1, also called juvenile diabetes or insulin-dependent diabetes, is a disorder of the body's immune system. In type 1 diabetes, the pancreas produces little or no insulin as a result of the immune system attacking and destroying the insulin-producing beta cells in the pancreas. Therefore, type 1 diabetes patients require frequent administration of insulin therapy each day to control their blood sugar levels.

About otelixizumab

Otelixizumab is a monoclonal antibody that binds to a receptor component found on all T cells known as CD3, which is involved in normal T cell signaling. Otelixizumab is designed to block the function of autoreactive T-effector cells that attack the body’s tissues and cause autoimmune disease while inducing a subset of T cells called T-regulatory cells that are thought to protect against T-effector cell damage well after the drug has been eliminated from the body. In a Phase II clinical study of subjects with new-onset type 1 diabetes, otelixizumab demonstrated the potential to preserve the function of insulin-producing beta cells in the pancreas and reduce the amount of administered insulin needed to control blood glucose levels for up to 18 months after only a single six day course of therapy. In the study, residual betacell function was assessed by measuring glucose clamp-induced C-peptide release before and after the administration of glucagon. Otelixizumab administration was associated with transient symptoms of flu-like syndrome and transient Epstein-Barr Virus (EBV) reactivation. Tolerx has completed dose optimisation studies in subjects with type 1 diabetes and psoriasis and has identified a dosing regimen that thus far has significantly reduced or eliminated these side effects while maintaining important biological activity.

About GlaxoSmithKline

GlaxoSmithKline is one of the world's leading research-based pharmaceutical and healthcare companies and is committed to improving the quality of human life by enabling people to do more, feel better and live longer. For more information, visit GlaxoSmithKline at www.gsk.com.

About Tolerx

Tolerx is a biopharmaceutical company engaged in the discovery and development of novel therapies to treat patients with immune-mediated diseases. Tolerx currently has two antibodies in clinical development: otelixizumab in type 1 diabetes and psoriasis, and TRX1 in cutaneous lupus erythematosus (CLE). TRX1 is a humanised anti-CD4 antibody that is being developed in collaboration with Genentech, Inc. Tolerx is also engaged in preclinical development of new product candidates that induce immunological tolerance for the treatment of autoimmune diseases and circumvent tolerance for the treatment of cancer or chronic viral diseases. For more information, please visit www.tolerx.com.

GlaxoSmithKline forward-looking statements
Under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, GSKcautions investors that any forward-looking statements or projections made by GSK, including those made in this announcement, are subject to risks and uncertainties that may cause actual results to differ materially from those projected. Factors that may affect GSK's operations are described under 'Risk Factors' in the Operating and Financial Review and Prospects in the company's Annual Report on Form 20-F for 2006.

Tolerx forward-looking statements
This press release contains certain statements that are preceded by, followed by, or that include the words “will” “may,” “if,” “assuming” or similar expressions or the negation thereof, Such statements, which are not historical facts, constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Reform Act”). Statements regarding GSK’s financing commitment to Tolerx, the potential value of payments that may be received by Tolerx pursuant to the agreement with GSK, and the anticipated progress and development of otelixizumab, in type 1 diabetes and other disease indications, are all forward-looking statements. Such forward-looking statements involve risks, uncertainties and other factors that may cause the actual performance or achievements of Tolerx to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. Factors and risks that may affect the forward-looking statements include the ability of the parties to collaborate successfully to develop the product candidates, results of future clinical studies, the ability to obtain regulatory approvals for otelixizumab for type I diabetes or any other indication, and the introduction of competing therapies by other companies. These statements reflect the view of Tolerx as of the date of this press release, and Tolerx undertakes no obligation to update or revise any forward-looking statements to reflect events or circumstances after the date of this press release.

GlaxoSmithKline enquiries:

UK Media enquiries:	Philip Thomson	(020) 8047 5502
	Alice Hunt	(020) 8047 5502
	Joss Mathieson	(020) 8047 5502
	Claire Brough	(020) 8047 5502
US Media enquiries:	Nancy Pekarek	(215) 751 7709
	Mary Anne Rhyne	(919) 483 2839
European Analyst/Investor enquiries:	David Mawdsley	(020) 8047 5564
	Sally Ferguson	(020) 8047 5543
US Analyst/ Investor enquiries:	Frank Murdolo	(215) 751 7002
	Tom Curry	(215) 751 5419

Tolerx enquiries:

CEO:	Douglas J Ringler	(617) 452 1322
CFO:	Tom Shea	(617) 452 1328
Media contact:	Melissa Hill	(619) 849 6004