Cygnus Therapeutic Systems said the decision by Proctor & Gambleto discontinue a collaboration over development of an unspecifiedproduct involving Cygnus' mucosal delivery technology will haveminimal financial impact.

Susan Snyder, manager of corporate communications for Cygnus,said the product did not meet Proctor & Gamble's financial needs,but Cygnus, of Redwood City, Calif., intends to exploreopportunities with other potential partners to continue development.

Cygnus' collaboration with Proctor & Gamble, of Cincinnati, beganin October 1993 and was the first of two agreements between thecompanies. In February 1994, the two signed a deal to developsmoking cessation products and that project continues. Financialterms for the collaborations were not disclosed.

In addition to mucosal delivery technology, Cygnus is involved inthe development of transdermal delivery products and non-invasivemonitoring systems. The company has one product on the market,Nicotrol, a transdermal nicotine patch.

Cygnus's stock (NASDAQ:CYGN) closed Friday at $7.87, down 69cents. _ Charles Craig

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