Insulin-like growth factor-1, or IGF-1, is the direct mediator of growth hormone's effect on statural growth and must be present in order for children's bones, cartilage, and organs to grow normally.Severe Primary IGFD is a growth hormone-resistant state characterized by abnormally low blood IGF-1 levels in the presence of normal or elevated growth hormone, which afflicts approximately 6,000 children in the U.S.

"We believe that no child should suffer from a preventable or treatable disorder," said Mary Andrews, Chairman and Founder of the MAGIC Foundation, a non-profit organization that supports the families of children with growth

problems. "With today's FDA approval, we are happy to know that there is a new treatment option for children suffering from short stature caused by severe Primary IGFD."

"We are pleased Increlex was approved within the six-month priority review timeline, making Increlex the only therapy indicated to treat children with severe Primary IGFD," said John A. Scarlett, M.D., President and Chief Executive Officer of Tercica. "Today, Increlex becomes Tercica's first

commercial drug and represents the first major innovation in the treatment of short stature since recombinant growth hormone was approved 20 years ago -- an advance that we believe will change the way physicians diagnose and treat

patients with growth failure due to severe Primary IGFD."

"For more than 30 years, growth hormone has been the only treatment option endocrinologists have had for children with short stature due to hormonal deficiency," said Philippe Backeljauw, M.D., Division of Endocrinology,

Cincinnati Children's Hospital and a co-investigator in the Phase III trial conducted for Increlex. "The availability of Increlex will enable physicians to offer a more specific treatment for children whose growth failure is linked

to abnormally low blood IGF-1 levels."

The active ingredient of Increlex is identical to the natural hormone, IGF-1, which the body produces in response to stimulation by growth hormone.

Without adequate IGF-1, children cannot achieve height within the normal range. Tercica acquired exclusive rights to develop, commercialize and manufacture Increlex from Genentech, Inc.

Ross Clark, Ph.D., Founder and Chief Technical Officer of Tercica, said, "This product approval is the culmination of more than two decades of research and development at Genentech. We would like to acknowledge the collective

efforts of our clinical investigators, our collaborators, and our partner Genentech. Their contributions have helped bring this new drug to pediatric endocrinologists and to the children and families affected by this disorder."

About Severe Primary IGFD

Children with severe Primary IGFD have height and serum IGF-1 levels that are more than three standard deviations below normal.They are not growth hormone deficient, and, because they are resistant to the effects of growth hormone, they cannot be expected to respond adequately to growth hormone therapy.In both children and adults, severe Primary IGFD can lead to a range of other metabolic disorders including lipid abnormalities, decreased bone

density, obesity and insulin resistance.

"IGF-1 has proven to be the most critical factor in the growth of children," said Ron Rosenfeld, M.D., Senior Vice President of Medical Affairs, Lucille Packard Foundation for Children's Health and Professor of Pediatrics,

Stanford University."For many years, we believed that growth was largely regulated by the production of growth hormone from the pituitary gland.We now know that while growth hormone is critical, it is IGF-1 that is the

primary mediator of growth."

About the Increlex Trials

The FDA's approval of Increlex is based on clinical trial data from 71 patients. Data reported at the 2004 Annual Meeting of the Endocrine Society demonstrated a statistically significant increase (p<0

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