IMS Report " In 2000, U.S. sales of prescription drugs for the treatment of insomnia exceeded $900M " In 2000, over $1.4B was spent in the U. S. on anti-anxiety drugs, exclusive of antidepressants.		Insomnia and Anxiety Insomnia is defined as a persistent complaint of difficulty in initiating or maintaining sleep, or of not feeling rested or functioning normally after an otherwise adequate amount of sleep. According to the National Sleep Foundation, approximately one-half of the adults surveyed reported trouble sleeping at least a few nights a week in the past year, with approximately 29% of the U.S. Population reporting that they experience insomnia every night or almost every night. Anxiety can be defined in broad terms as a state of unwarranted or inappropriate worry and is made up of various disorders, including General Anxiety Disorder (GAD), panic disorder and phobias. Most drugs currently marketed to treat insomnia and anxiety target the neurotransmitter gamma aminobutryic acid, or GABA. Neurotransmitters are chemicals in the central nervous system that either excite or inhibit neuronal function. GABA is one of the principal neurotransmitters in the central nervous system. As a result, drugs acting on GABA receptors can produce a range of pharmacological actions. Benzodiazepines, or BDZs, such as Valium, Librium and Xanax, target a subset of GABA receptors commonly referred to as GABAA receptors. BDZs have enjoyed widespread commercial success for over 40 years for the treatment of anxiety, insomnia and epilepsy. In addition to their desired therapeutic effects, however, BDZs are known to produce a variety of undesired side effects. For example, when used to treat anxiety, these side effects can include sedation, muscular incoordination, memory impairment and potentially lethal effects when used with alcohol. BDZs also produce tolerance, physical dependence and can potentially be abused. For many years, our senior management team has conducted research on GABAA receptors. Their pioneering work classified GABAA receptors into biochemically, pharmacologically and functionally distinct receptor subtypes. They demonstrated that one subset of GABAA receptors influences anxiety and epilepsy, another sedation, coordination and muscle relaxation and a third amnesia and the deleterious effects of alcohol. Furthermore, through their research delineating the actions of BDZs on GABAA receptors, they were the first investigators to discover non-BDZ compounds that act on specific GABAA receptor subtypes. BDZs are believed to produce their undesired side effects at therapeutic doses because they affect all GABAA receptor subtypes. We believe that compounds that act on specific GABAA receptor subtypes will produce the desired therapeutic effects while eliminating or reducing the undesired side effects associated with BDZs. For example, compounds acting at one GABAA receptor subtype may reduce anxiety, while compounds acting at another GABAA receptor subtype may produce sedation, in each case without the effects associated with acting at other subtypes.