FOR IMMEDIATE RELEASE

Tokyo, December 28, 2006 --- Japan Tobacco Inc. (JT) (TSE: 2914) today announced that the company has signed a licensing agreement with MedImmune, Inc. (MedImmune; headquarters: Gaithersburg, Maryland). Under the terms of the agreement, MedImmune will obtain the rights to develop and commercialize JT's antibody drug candidate, which is currently under preclinical study in Japan.

The new drug candidate is a human monoclonal antibody that works against inducible costimulator (ICOS), a protein associated with T-cell activation that plays a key role in the body's immune responses.

T-cells are activated by both antigen and costimulation signal. ICOS is one of the costimulation molecules and its expression is induced on activated and memory T-cells. As the new drug candidate blocks ICOS signal and regulates immune responses caused by activated and memory T-cells, it may be developed in the fields of immune disorders, inflammation and allergies.

The licensing agreement allows MedImmune exclusive worldwide rights (with the exclusion of Japan) to develop and commercialize JT's antibody drug candidate. In addition, MedImmune has certain rights worldwide associated with the development of other anti-ICOS antibodies. JT will receive an initial payment, and could receive additional cash payments upon achievements of certain milestones in development and product sales, and royalties based on the sales of products.

The following is additional information regarding human monoclonal antibodies.

Human monoclonal antibodies
Human monoclonal antibodies are human-derived, and respond to certain types of antigens including viruses. As all amino acid sequences are derived from human, there is less capability of anti-antibody reaction.

Costimulation receptor
Costimulation receptors exist on the surface of T-cells and transmit activation or inactivation signal in combination with an antigenic stimulus.

Memory T-cells
The majority of activated T-cells eventually die; however some survive as memory T-cells and exist in the human body for long periods of time. Memory T-cells recognize foreign antgens such as bacteria or viruses that were encountered during a prior infection or vaccination. They can rapidly mobilize and clone themselves should the same antigen be re-encountered during a second infection at a later time.

About MedImmune, Inc.
MedImmune, Inc. strives to provide better medicines to patients, new medical options for physicians, rewarding careers to employees, and increased value to shareholders. Dedicated to advancing science and medicine to help people live better lives, the company is focused on the areas of infectious diseases, cancer and inflammatory diseases. With more than 2,500 employees worldwide, MedImmune is headquartered in Maryland.

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