SCOLR, Inc. Successfully Meets Critical Milestone in Advancing Its Drug Delivery Business; Favorable Clinical Results Open the Way to Discussions with Prescription Drug Industry

REDMOND, Wash.--Oct. 3, 2002--SCOLR, Inc. (OTCBB:SCLL) announced today the successful completion of its pivotal biotrial providing Proof of Concept for the lead technology, Self Correcting Oral Linear Release drug delivery systems in human subjects. Interim results provide a positive correlation with the extensive in-vitro experiments conducted on the Company's CDT(TM) drug delivery platform and yield a good pharmacokinetic profile for the technology embodied in U.S. Patent 6,090,411.

The results of the trial, currently under final analysis at Temple University by Dr. Reza Fassihi, are expected to be published next month. Dr. Fassihi, Professor of Biopharmaceutics and Industrial Pharmacy at the Temple University School of Pharmacy and inventor of the three patented Controlled Delivery Technology(TM) platforms, has been partnered with SCOLR for the development of the CDT(TM) technology. Dr. Fassihi will present the final results to the industry at the American Association of Pharmaceutical Scientists (AAPS) in mid November in Toronto, Canada.

The CDT(TM) Controlled Delivery Technology biotrial was conducted in collaboration with NorthWest Kinetics, a Tacoma, Washington-based clinical research organization specializing in Phase I and Phase II clinical trials. The SCOLR trial was conducted in controlled facilities and involved 18 fed and 18 fasted patients receiving single daily dosings of the test compound, a highly soluble and permeable BCS Class 1 drug. The trial was conducted in a double blind fashion against the reference drug compound listed in the industry's Orange Book and the interim results were confirmatory of the Company's expectations for this novel new method of providing controlled delivery for oral prescription drugs.

David Howard, President & CEO of SCOLR, said that, "Our first successful human biotrial has clearly demonstrated that the Self Correcting Oral Linear Release delivery platforms developed by our staff and Dr. Fassihi of Temple University School of Pharmacy are viable alternatives to older drug delivery systems and that, in the future, lower cost, faster-to-market, sustained-release formulations of prescription drugs will be possible with our lead technology.

"Following two years of extensive in-vitro work on the three drug delivery platforms within our portfolio of CDT technology, our R&D staff has successfully managed the transition from a theoretical concept for a unique method of controlling drug release from tablets, to an issued U.S. patent embodying these initial concepts, and through the essential R&D and manufacturing Proofs of Concept to arrive at today's important announcement. These results support our belief that CDT technology offers a real alternative to the pharmaceutical industry which is seeking new, powerful oral delivery systems offering lower cost and faster-to-market capabilities, and features including:

-- The capability of delivering precise amounts of active pharmaceutical ingredients (API) over programmable time periods;
-- Suppression of burst effect - a common problem with older diffusion systems.
-- No tailing off in API release at the end of the dosing interval;
-- Cost effective/ Low cost of formulation and development and manufacturing;
-- Reduced time from bench development to manufacturing--easy SUPAC site transfers
-- CDT processing that is not equipment dependent and requires no specialized equipment or processing;
-- Employs all GRAS (Generally Regarded As Safe) excipients already FDA approved for use in pharmaceuticals;
-- Two step processing--dry blend and direct compression;
-- Easily identifiable and controllable criticality in blend uniformity.

"We now have the validation that our technology works in the human body and that our technology offers a valuable alternative to existing modified dosage forms (including reservoir and multi-particulate systems which are complicated and expensive). Armed with these positive results, we have begun discussions with and will make initial presentations to drug delivery and pharmaceutical companies as potential licensing partners of our CDT(TM) technology. Over the past two and one half years, SCOLR has put into place many of the essential elements pre-requisite to partnering with pharmaceutical companies in the domestic $20 billion oral drug delivery market and the Company has now extended its discussions and presentations of the unique features of our technology to include major U.S. pharmaceutical and drug delivery companies. We expect to secure our first pharmaceutical product project during the first half of 2003," Howard said.

Based in Redmond, Washington, SCOLR, Inc. (formerly Nutraceutix, Inc.) is a biopharmaceutical company leveraging specialized knowledge, proprietary and patented products and technologies, such as the patented CDT(TM) Controlled Delivery Technology platform, to introduce distinctive and novel OTC products, prescription drugs and dietary supplements. SCOLR currently operates in two business segments - drug delivery and nutraceuticals. Its CDT(TM) drug delivery platform provides distinctive products with tangible benefits for the consumer and competitive commercial advantages for licensees.

Established partnerships with pharmaceutical, OTC and natural products industry companies enable SCOLR to co-develop new products and to add value and protection to existing product franchises. For more information on SCOLR, please call 1.800.548.3222 or visit

Except for any historical information, the matters discussed in this press release contain forward-looking statements within the meaning of Section 37A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements involve risks and uncertainties, including activities, events or developments that the company expects, believes or anticipates will or may occur in the future. A number of factors could cause actual results to differ from those indicated in the forward-looking statements, including the Company's ability to continue to successfully market and provide its products and services and maintain their effectiveness, the continuation of the arrangements with the Company's product development partners, the ability of the Company to meet its financial projections, and general economic conditions. Such statements are subject to a number of assumptions, risks and uncertainties. Readers are cautioned that such statements are not guarantees of future performance and that actual results or developments may differ materially from those set forth in the forward-looking statements. The Company undertakes no obligation to publicly update or revise forward-looking statements whether as a result of new information or otherwise.

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