Biota Holdings Limited Release: HRV Drug Commences Dosing For Phase Ib Clinical Trial

Melbourne, Australia – 17 August 2006-- Biota Holdings Limited (ASX:BTA) today announced the first dose administration in healthy volunteers in its Phase Ib clinical trial for its Human Rhinovirus (HRV) drug, BTA798.

BTA798 is an antiviral for the treatment of HRV, the common cold virus, known to cause significant clinical complications in sufferers of Asthma and Chronic Obstructive Pulmonary Disease, the fourth leading cause of death in the US.

The Phase Ib trial is an ascending, multiple dose, double-blinded study with oral administration of the drug to 32 healthy volunteers. The primary objective of the trial is to assess the safety and tolerability of BTA798, with a secondary objective to determine the pharmacokinetic properties of the drug over multiple doses.

The Phase Ib trial is being conducted in the UK with the acceptance of the Medical & Healthcare Products Regulatory Agency (MHRA) and the Independent Ethics Committee (IEC).

The Phase Ib trial is the second of two parts of the Phase I clinical trial that commenced in February 2006. Phase Ia was successfully completed with BTA798 found to be safe and well tolerated in healthy volunteers.

Investor / Analyst Enquiries Media Enquiries Biota Holdings Limited Tim Duncan or Nerida Mossop Peter Cook Hinton & Associates T: +61 3 9915 3720 T: +61 3 9600 1979 Damian Lismore M: 0408 441 122 T: +61 3 9915 3721

About Human Rhinovirus, including in Asthma & COPD

Rhinoviruses can cause up to 50% of all adult colds, and are the predominant common cold virus in children. In the United States, there are approximately 45 million bed days annually associated with the common cold. 75% of common colds suffered by children under 5 years of age in the US are medically attended. HRV is a major cause of hospitalisation and respiratory distress in asthma and COPD sufferers.

It is estimated that Rhinovirus is associated with approximately 70% of all asthma exacerbations and more than 50% of the hospitalised cases. A recent study has estimated the economic impact of asthma in Germany to be in billions of Euros. Although the actual costs of viral exacerbations in asthma are not known, they appear to contribute significantly to the total cost of the disease as they represent some 80% of exacerbations in children and between 40% and 76% in adults.

Chronic Obstructive Pulmonary Disease (COPD) is the fourth leading cause of death in the US. An estimated 10 million adults were diagnosed with COPD in 2000, while a national health survey suggests that as many as 24 million Americans are affected. In 2000, 119,000 deaths, 726,000 hospitalisations, and 1.5 million hospital emergency department visits were caused by COPD. Studies suggest that respiratory viruses are associated with more than 35% of acute exacerbations of COPD requiring hospitalisation.

About clinical trials

About Biota Biota is a world-leading antiviral drug development company based in Melbourne, with key expertise in respiratory diseases, particularly influenza. Biota developed the first-in-class neuraminidase inhibitor, zanamivir, and subsequently marketed by GlaxoSmithKline (GSK) as Relenza. Relenza is currently being stockpiled by a number of national governments for defense against avian influenza. Biota receives royalties from sales of Relenza.

Recent Biota research breakthroughs have included a series of candidate drugs aimed at RSV (Respiratory Syncytial Virus, bronchiolitis), subsequently licensed to MedImmune Inc. Biota has Phase I clinical trials underway with HRV (human rhinovirus) and is also engaged in early stage research targeting hepatitis C virus infection. In addition, Biota has key partnerships with Sankyo; for the development of second generation influenza antivirals (called LANI or Long Acting Neuraminidase Inhibitors) and with Thermo Electron (Inverness Medical); Biota developed the FLU OIA® influenza diagnostics, currently marketed in the US.

™Relenza is a registered trademark of the GlaxoSmithKline group of companies.

®FLU OIA & FLU OIA A/B are registered trademarks of Thermo Electron Corporation.

*Further information available at www.biota.com.au.

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