Ceragenix Pharmaceuticals Inc. (OTCBB:CGXP), a biopharmaceutical company focused on infectious disease and dermatology, today announced that it has begun enrolling patients in a multicenter pediatric clinical study designed to assess the efficacy of EpiCeram compared to Elidel, the leading topical immunosuppressant prescribed for treating patients with mild-to-moderate atopic dermatitis (eczema). The randomized, double blind study will consist of 50 to 100 children between the ages of 2 and 18 years. For a four-week period, half of the subjects will receive treatment with EpiCeram) and the other half will receive treatment with Elidel.

The objective of the study is to assess the safety and efficacy of EpiCeram relative to Elidel in treating the symptoms associated with eczema such as itch and redness as measured by the EASI scoring system. The study is being conducted at the University of California, San Diego with Dr. Lawrence Eichenfield as principal investigator and the Oregon Health Sciences Center of the University of Oregon with Dr. Eric Simpson as principal investigator. The Company expects to complete the study and announce the results during the fourth quarter of 2007. Elidel is the most commonly prescribed drug for treatment of atopic dermatitis with annual sales of approximately $200 million.

In April 2006, Ceragenix received 510(k) clearance from the FDA to market EpiCeram as a new prescription-only cream designed to improve dry skin conditions and to relieve and manage the burning and itching associated with various dermatoses including atopic dermatitis, irritant contact dermatitis, radiation dermatitis, and other dry skin conditions by maintaining a moist wound and skin environment. EpiCeram is a non-steroidal cream that is based on the company's Barrier Repair Technology invented by Dr. Peter Elias and exclusively licensed by Ceragenix from the University of California.

The Company recently announced results from a 113 person clinical study that compared EpiCeram to Cutivate, a topical mid-strength steroid in treating the symptoms associated with eczema in patients with moderate to severe eczema. The study demonstrated that both EpiCeram and Cutivate significantly reduced the symptoms of eczema and that there was no statistically significant difference between the efficacy of EpiCeramand Cutivate after 28 days of treatment as measured by the study's primary and secondary endpoints.

"We are pleased to announce that this study has commenced," stated Steven Porter, Chairman and CEO of Ceragenix. "If EpiCeram shows comparable efficacy in this study, we believe it will be another step forward in helping us achieve our goal of establishing EpiCeram as the standard of care for treating atopic dermatitis. Our recently concluded study demonstrated that EpiCeramhas comparable efficacy to a mid strength steroid after 28 days of treatment. Many dermatologists consider mid-strength topical steroids to be as or even more potent than Elidel. If we can show comparable efficacy to Elidel, we believe we should have a competitive advantage as EpiCeram does not have the negative side effects associated with these categories of products."

Topical steroids and immunosuppressants represent the majority of the estimated $1 billion market for treating eczema in the U.S. However, unlike steroids and immunomodulators, both of which have well recognized undesirable side effects and usage restrictions, EpiCeram's non-steroidal formulation has a very favorable safety profile and does not have the duration of use restrictions or pediatric patient age restrictions of these other classes of prescription products. Immunomodulator drugs used for treating atopic dermatitis recently received a black box safety warning from the FDA.