Palo Alto, Calif.
January 6, 2009

Anacor Pharmaceuticals today announced that it has raised $50 million through a preferred stock financing with participation from GlaxoSmithKline, Schering Corporation and existing investors including Rho Capital Partners, Venrock Associates, Care Capital and Aberdare Ventures. Proceeds from the financing will be used to further develop Anacor's product pipeline based on its boron chemistry platform.

"We are pleased to complete this financing, which will allow us to advance our five clinical programs and to identify and progress new compounds derived from our boron chemistry platform," said David Perry, Chief Executive Officer at Anacor Pharmaceuticals.

The investments from GSK and Schering Corporation fulfill each company's investment obligations pursuant to their respective and ongoing collaborations with Anacor. At the conclusion of the financing, the combined ownership of GSK and Schering Corporation will be less than 20 percent of Anacor's outstanding shares.

About Anacor Pharmaceuticals

Anacor is a biopharmaceutical company developing novel small molecule therapeutics derived from its boron chemistry platform. Anacor has focused initially on developing topical applications of its compounds to treat fungal, bacterial and inflammatory diseases. In addition, the Company is developing systemic antiviral and antibacterial therapeutics under a research and development agreement with GlaxoSmithKline. Anacor's most advanced product candidate is AN2690, a novel topical antifungal in development for the treatment of toenail onychomycosis, which is a fungal infection of the nail and nail bed. AN2690 is licensed to Schering-Plough Corporation under a worldwide development and commercialization agreement for all indications including the treatment of onychomycosis. For more information visit www.anacor.com.

Forward-Looking Statements

This press release contains forward-looking statements, including statements regarding the progress and timing of our clinical trials, the safety and efficacy of our product candidates, and the role that AN2728 may play in the future treatment of psoriasis. These statements relate to future events and involve known and unknown risks, uncertainties and other factors that could cause actual levels of activity, performance or achievement to differ materially from those expressed or implied by these forward-looking statements. Some factors that may affect these forward-looking statements include, but are not limited to, undesirable effects, lack of efficacy or other developments resulting in clinical failure at later stages of development of our product candidates. These statements reflect the views of Anacor as of the date of this press release with respect to future events and, except as required by law, it undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise after the date of this press release.