ANACOR PHARMACEUTICALAS FORMED TO DEVELOP NEW CLASS OF THERAPEUTICS

Announces Distinguished Board of Directors; David Perry Joins as CEO

Palo Alto, Calif., October 29, 2002 - Anacor Pharmaceuticals today announced its formation as an early-stage pharmaceutical company engaged in the discovery and development of novel antimicrobials for the treatment of serious bacterial and fungal infections.

Anacor will focus on the development of technology initially created by company co-founders Dr. Lucy Shapiro at Stanford University and Dr. Stephen Benkovic at Pennsylvania State University. The company's initial therapeutic targets are staphylococcus, streptococcus pneumoniae, anthrax, tularemia and other infectious diseases.

Anacor also announced today that it has been awarded a $21.6 million joint contract from the Defense Advanced Research Projects Agency (DARPA) and the United States Army Medical Research and Materiel Command (USAMRMC) to expedite the research and development of therapeutics for use against biowarfare agents such as anthrax (see "Anacor Pharmaceuticals Receives $21.6 Million Contract from Department of Defense"). Additionally, Anacor announced today that it has raised $7 million in financing from Aberdare Ventures and Rho Ventures (see "Anacor Pharmaceuticals Raises $7 Million in Venture Financing").

Board of Directors
Anacor's board of directors consists of members of the scientific and investment community who bring significant expertise in scientific research and in building successful biotechnology ventures.

Mark Leschly, Chairman of the board of directors of Anacor, is Managing Partner of Rho Ventures, a venture capital firm with extensive investments in the technology, healthcare and electronic information sectors. Prior to joining Rho, Mr. Leschly was a general partner at Healthcare Ventures. His current and recent board seats include Diversa, Memory Pharmaceuticals, Medical Present Value, Orametrix, NitroMed, Senomyx and Versicor. Mr. Leschly received a B.A. from Harvard University and an M.B.A. from Stanford Graduate School of Business.

Stephen J. Benkovic, Ph.D, co-founder of Anacor, is the Evan Pugh Professor and Eberly Chair in Chemistry at The Pennsylvania State University. His work has been recognized by a long series of awards and fellowships, including the Alfred P. Sloan Fellowship, an NIH Career Development Award, a Guggenheim Fellowship, the Pfizer Award in Enzyme Chemistry, an Arthur C. Cope Scholar Award, the Gowland Hopkins Award, the Alfred Bader Award, the Repligen Award for Chemistry of Biological Processes, and the Christian B. Anfinsen Award. Dr. Benkovic has served on a number of scientific advisory boards and heads the Scientific Advisory Board for GlaxoSmithKline. Dr. Benkovic's recent work focused on developing a number of proprietary compounds to attack the target enzymes identified by Dr. Shapiro.

Paul Klingenstein, general partner of Aberdare Ventures, has been a venture capital investor for most of his professional career. Beginning at Warburg, Pincus in the early 1980s, he joined Accel Partners in 1986 and helped, through the next decade, to build a leading venture capital firm. After a brief period as an advisor to the Rockefeller Foundation, he formed Aberdare Ventures in 1999. Among his current and former boards are Alibris, Anacor Pharmaceuticals, Aviron, CapitalThinking, EP Technologies, Glycomed, Idun Pharmaceuticals, Isis Pharmaceuticals, Pharmion, U.S. Behavioral Health, Viagene, and Xomed Surgical Products. He has served on the boards of various educational and nonprofit institutions including the African Wildlife Foundation, The International Aids Vaccine Initiative, Juma Ventures, the Marin Country Day School, and The Taft School. He received an A.B. from Harvard and an M.B.A from Stanford.

Martin Rosenberg, Ph.D, recently retired from his position as senior vice president of anti-infectives and drug discovery at GlaxoSmithKline. He is currently vice president of research & development at Promega Corporation. Dr. Rosenberg presently holds Adjunct Professorships in the Departments of Bacteriology at the University of Wisconsin-Madison, Microbiology at the University of Pennsylvania and Biochemistry at the Robert Wood Johnson Medical School in New Jersey. He is a member of the Board of Directors of the Promega Corporation, Elitra Pharmaceuticals and Nereus Pharmaceuticals. Dr. Rosenberg has published more than 200 papers and is a named inventor on almost fifty issued patents.

David Perry joined Anacor as CEO in March of 2002. Prior to Anacor, he founded Chemdex in 1997, a business-to-business marketplace company focused on the life-sciences industry. As its CEO, Mr. Perry led Chemdex through three rounds of private financing and an IPO in 1999. After a series of acquisitions and joint ventures, the company name was changed to Nexprise, and he remained CEO until November of 2001. He continues to serve as non-executive Vice-Chairman of Nexprise. In 1995, Mr. Perry co-founded Virogen, a biotech company based in Boston. Prior to Virogen, he worked as a chemical engineer and manager for Exxon. He was named Entrepreneur of the Year in Northern California in 2000. He has a B.S. in Chemical Engineering from the University of Tulsa and an M.B.A. from Harvard Business School.

George Poste DVM, Ph.D, is chief executive officer of Health Technology Networks, a consulting group specializing in the impact of genetics, computing and other advanced technologies on healthcare R&D. From 1992 to 1999, he was President, R&D and Chief Science and Technology Officer at SmithKline Beecham and a member of the Board of Directors. He is non-executive Chairman of diaDexus, the joint venture in molecular diagnostics between SmithKline Beecham and Incyte Pharmaceuticals, and non-Executive Chairman of Structural GenomiX. He serves on the Board of Directors of Maxygen, Orchid BioSciences and Illumina. He is a member of Defense Science Board of the U.S. Department of Defense and in this capacity chairs the Task Force on Bioterrorism.

Lucy Shapiro, Ph.D, co-founder of Anacor, is the Virginia and D.K. Ludwig Professor of Cancer Research and Director of the Beckman Center in the School of Medicine, Stanford University. She is an authority on the genetics and biochemistry of the development and regulation of the bacterial cell cycle, and has published more than 205 scientific articles on a wide range of topics. In addition to her position on Anacor's board of directors, Dr. Shapiro currently serves as non-executive director of GlaxoSmithKline. Dr. Shapiro's work in validating and understanding the target enzymes was a key contribution to Anacor's current research.

"Anacor Pharmaceuticals therapeutics research program seeks to develop novel classes of anti-infectives which inhibit new pathogen targets through extensive use of functional genomics and de novo drug design," added Dr. Lucy Shapiro. "I am pleased that my initial work on this technology will be furthered through the efforts of Anacor."

"Because of the increasing bacterial resistance to antibiotics, the discovery and development of novel antimicrobials is one of the most important fields of research today," stated Dr. Stephen Benkovic. "I look forward to working with Anacor in helping the company bring the promise of our early work to a broader market."

"Our mission is to take the groundbreaking ideas and discoveries of Lucy Shapiro and Stephen Benkovic and bring them to market," said David Perry, CEO of Anacor Pharmaceuticals. "With the experience of our initial team and advisors, the backing of our investors and the substantial contract with the Department of Defense, we have all the ingredients to drive the innovation of an entirely new class of therapeutics."

About Rho Ventures
Rho Ventures is a venture capital firm with extensive investments in the technology, healthcare and electronic information sectors. Since it was founded in 1981, the firm has invested in numerous companies including Ciena, Commerce One, Compaq Computer, Copper Mountain, Diversa, Human Genome Sciences, Leukosite, MedImmune, Shire Pharmaceuticals and Versicor. Aggregate venture capital under management exceeds $1 billion. Additional information can be found at www.rho.com.

About Aberdare Ventures
Aberdare Ventures is a San Francisco-based venture capital firm with a primary focus on healthcare technologies. Although most Aberdare investments are made at the earliest stages of company development, the firm will invest, and work in close partnership with the best entrepreneurial teams, at all stages. Additional information can be found at www.aberdare.com.

About Anacor
Anacor Pharmaceuticals is an early-stage pharmaceutical company engaged in the discovery and development of novel antimicrobials for the treatment of serious bacterial and fungal infections. The company's technology is based on work originally conducted by Dr. Lucy Shapiro at Stanford University and Dr. Stephen Benkovic at Pennsylvania State University. Its initial therapeutic targets are staphylococcus, streptococcus pneumoniae, anthrax, tularemia and other infectious diseases. The company's research is funded in part by a joint contract from the Defense Advanced Research Projects Agency (DARPA) and the United States Army Medical Research and Materiel Command (USAMRMC). Privately held and based in Palo Alto, Calif., Anacor is funded by Aberdare Ventures and Rho Ventures. For more information, visit www.anacor.com.