RESEARCH TRIANGLE PARK, N.C.–Tranzyme Pharma (Nasdaq:TZYM), a biopharmaceutical company focused on discovering, developing and commercializing novel small molecule macrocyclic compounds, today announced the successful completion of its chemistry-based drug discovery collaboration with Bristol-Myers Squibb. As a result of the joint research efforts, Tranzyme has transferred compounds to Bristol-Myers Squibb for further development across multiple drug targets. As part of this agreement, Tranzyme retains the option to further pursue select collaboration targets for internal development.

The goal of the strategic collaboration, established in December 2009, was to deploy Tranzyme’s proprietary chemistry technology, Macrocyclic Template Chemistry (MATCH™), in the discovery of novel active macrocycles against a range of diverse biological targets that have historically been difficult to access with conventional small molecule chemistry. These macrocycles represent a distinct and underexplored compound class that displays favorable characteristics exhibited by large biomolecules, such as high potency and selectivity, while maintaining the benefits typically associated with small molecule drugs, such as high oral availability, good tissue and cell permeability and low cost of goods.

Under the terms of the agreement, Tranzyme had primary responsibility for early lead compound discovery. Bristol-Myers Squibb has primary responsibility for optimizing the identified lead compounds, and sole responsibility for completing preclinical and clinical development of all products arising from the collaboration, and for their commercialization globally. Total milestone payments under the agreement, excluding royalties and sales milestones, could reach up to approximately $80 million for each target program.

“We have enjoyed an exceptionally close and productive relationship with Bristol-Myers Squibb and are excited to be transitioning now the fruits of our discovery collaboration to our partner for further development,” said Helmut Thomas, PhD, Tranzyme’s Senior Vice President of Research and Preclinical Development. “This milestone serves to further validate our technology’s broad application to a diverse range of difficult drug targets and its value in the discovery of drugs for the treatment of diseases far beyond our own internal focus on gastrointestinal and metabolic disorders.”

About Tranzyme Pharma

Tranzyme Pharma is a biopharmaceutical company focused on discovering, developing and commercializing novel, mechanism-based therapeutics for the treatment of upper gastrointestinal (GI) motility disorders. While approximately 40 percent of people in the U.S. are affected by these persistent and recurring conditions which disrupt the normal movement of food throughout the GI tract, there are a limited number of safe and effective treatment options. By leveraging its proprietary drug discovery technology, MATCH™, Tranzyme is committed to pursuing first-in-class medicines to address areas of significant unmet medical needs.

Further information about Tranzyme Pharma can be found on the Company’s web site at www.tranzyme.com.