October 20, 2003

News Release: An Additional Product Opportunity of the I.N.T.(TM) Technology for Diabetes Transplant Patients

Transition Therapeutics Inc. ('Transition') (TSXV: TTH) announced today that it has received data demonstrating that the I.N.T.(TM) technology could increase the number of islet cell transplantation procedures for diabetic patients.

Islet cell transplantation is emerging as an effective treatment for insulin-dependent diabetes. Currently, islet cells harvested from one or two pancreases are required per transplantation for effective therapy. Therefore, the number of transplantation procedures is limited by the lack of availability of sufficient islet cells as well as a standardized method for islet cell preparation and distribution to potential transplantation facilities. Using human islet preparations isolated from human donor pancreases, Dr. Alex Rabinovitch and his research team from the University of Alberta demonstrated that treatment with I.N.T.(TM) expanded human islet cells in vitro by 3 to 4 fold. Furthermore, the islet cells could be maintained in culture for periods of up to 8 weeks.

'These data suggest that I.N.T.(TM) may be able to expand the number of islet cell transplantations performed thereby making transplantation a viable alternative treatment for a greater population of diabetics,'said Tony Cruz, Chairman and CEO of Transition.

This discovery demonstrates that I.N.T.(TM) may have an application to increase the number and longevity of islet cells prior to transplantation, thus allowing for better utilization of donated tissues to perform a greater number of transplantations in diabetic patients.

As a product opportunity for Transition, the use of I.N.T.(TM) for islet cell transplantation may have the advantage of a shortened product development cycle and earlier product revenues. This new product opportunity broadens Transition's current I.N.T.(TM) technology platform. Transition continues its current development of the I.N.T.(TM) technology as a short course of injections that stimulate the body to regenerate insulin-producing islet cells in the pancreas and has successfully completed a phase I clinical trial for this therapy.

Discussions with potential corporate partners are on-going for the development and commercialisation of the I.N.T.(TM) technology and Transition is optimistic that these discussions will yield a positive outcome in the near future.

About Transition

Transition is a Canadian biopharmaceutical company, engaged in the business of developing novel approaches and therapeutics with the potential for enhancing the quality of life of patients with such debilitating diseases as diabetes, multiple sclerosis and restenosis. Transition's lead products include I.N.T.(TM) for the treatment of diabetes and its Interferon Enhancing Therapy for the treatment of multiple sclerosis. In addition, Transition has identified a class of lead compounds that inhibit restenosis induced by stenting. Transition's shares are listed on the TSX Venture Exchange under the symbol 'TTH'.

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For further information: on Transition, visitwww.transitiontherapeutics.com or contact: Dr. Tony Cruz, Chief ExecutiveOfficer, Transition Therapeutics Inc, Phone: (416) 260-7770, x.223,tcruz(at)transitiontherapeutics.com; Catherine Auld, Chief Financial Officer,Transition Therapeutics Inc., Phone: (416) 260-7770, x.224,cauld(at)transitiontherapeutics.com

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