Fremont, CA (April 28, 2005) — Quark Biotech, Inc. announced today findings from a study that suggest that the hypoxia inducible gene RTP801 may serve an important role in the pathogenesis of early diabetic retinal disease. The study reveals that the knockout of RTP801 ameliorates diabetes-induced retinal vascular permeability (RVP) and electroretinogram (ERG) abnormalities in an animal model. The study, led by Dr. L.P. Aiello, Associate Director of Beetham Eye Institute of Joslin Diabetes Center in Boston, will be presented at the Association for Research in Vision and Ophthalmology (ARVO) annual conference in Fort Lauderdale, Florida from May 1st- 5th, 2005.

“RTP801 has been validated in vivo in several diseases, including early diabetic retinal disease,” said Dr. Daniel Zurr, Chief Executive Officer of Quark Biotech, Inc. “We believe that this gene may be used as target to develop novel therapeutics and we are looking forward to adding it to our pipeline.”

The data reveal that in the diabetic mouse, knockout of RTP801 reduces RVP by 80 percent, resulting in a 140 percent suppression of the diabetes-induced RVP.

Quark reported the discovery of RTP801 in 2002 and was recently granted three broad U.S. patents for covering the gene, its encoded protein and their inhibition. Quark has demonstrated in a model of retinopathy of prematurity (ROP) that knockout mice deficient of RTP801 are protected from the three major pathological hallmarks of this model of retinopathy: hyperoxia- associated vasoobliteration, hypoxia-induced apoptosis of neuroretina and retinal neovascularization (angiogenesis).

About Quark Biotech, Inc.

Quark Biotech, Inc. is a privately held development-stage, biopharmaceutical company headquartered in Fremont, CA. Through innovative combination of gene silencing and DNA microarray technology, Quark has pioneered and patented its BiFARTM platform for high-throughput functional profiling, allowing significant advances in the identification of target genes and proteins. This technology allows the company to develop conceptually novel drugs that provide previously unavailable benefits to patients. Quark is currently harvesting novel targets identified using this enabling foundation technology. Quark has focused development efforts on treatment of fibrotic and ischemic diseases of the eye, kidney and lungs, in indications with clear unmet medical needs.

Quark corporate product development teams and research facilities are based in Fremont, CA with research facilities also in Ness-Ziona, Israel. Additional information is available at www.quarkbiotech.com.