PharmaGap Inc.
TSX VENTURE : GAP
OTC Bulletin Board : PHRGF

PharmaGap Inc.

March 14, 2011 08:45 ET

PharmaGap Announces Completion of Oversubscribed Private Placement, Total Amount Raised $1,034,165

OTTAWA, ONTARIO--(Marketwire - March 14, 2011) - PharmaGap Inc. (TSX VENTURE:GAP)(OTCBB:PHRGF) ("PharmaGap" or "the Company") announced today that it has received further subscriptions for the final closing of the previously announced private offering of equity units (the "Units") in the amount of $198,440, bringing the gross aggregate amount for the full private placement to $1,034,165. A total of 1,804,000 units will be issued in the final closing at a price of $0.11 per Unit, bringing the total number of Units issued in the full private placement to 9,401,500. The final subscription amount exceeds the originally announced goal of the private placement by 310,591 Units and $34,165. Each Unit consists of one common share and one warrant to purchase one common share at an exercise price of $0.16 per common share with a two year warrant term. The final closing of this private placement, anticipated to occur later today, is subject to the approval of the TSX Venture Exchange and the shares and warrants issued pursuant to the private placement are restricted from trading for four months from the date of closing.

In connection with this final closing, $10,490 in cash fees and 95,360 broker warrants will be paid to Northern Securities Inc. Total cash fees for the full private placement amount to $86,258 ($26,308 to Northern Securities Inc., and $58,950 to individuals dealing at arm's length to the Company) Total broker warrants for the full private placement amount to 239,160, all to Northern Securities Inc. Broker warrants are issued on the same terms and conditions as the warrants included in the Units.

The private placement initially announced on February 24, 2011 has now been completed and no further Units will be issued pursuant to this placement. 

In order to facilitate the placement, SC Stormont Holdings Inc. ("Stormont"), a company owned by PharmaGap's Chairman, Mr. Roderick M. Bryden, has agreed to enter into Securities Lending Agreements with investors who so request to provide free-trading shares in exchange for the shares acquired in this placement which are restricted from trading for a period of four months from the issue date.

Mr. Robert C. McInnis, President and Chief Executive Officer of PharmaGap, said "I am extremely pleased that our shareholder base has responded to this private placement by exceeding our initial target placement expectations. These funds will allow us to move our clinical development program forward in the most efficient manner possible. I anticipate being able to provide development updates from this program on a more regular basis as elements of the program established by and now advancing under Dr. Ken Sokoll, our Vice President, Clinical Development and Chief Operating Officer, are completed over the remainder of the year."

About PharmaGap Inc.

PharmaGap Inc. (TSX VENTURE:GAP), based in Ottawa, ON, is a biotechnology company with a core focus on developing novel peptide therapeutics for the treatment of cancer. PharmaGap's GAP-107B8 is a novel peptide drug that has been shown to be highly cytotoxic to numerous cancer types, including chemo-resistant cancers, in vitro. For more information on PharmaGap please visit the Company's website at www.pharmagap.com.

Forward-Looking Statements

This news release contains certain statements that constitute forward-looking statements as they relate to the Company and its management. Forward-looking statements are not historical facts but represent management's current expectations of future events, and can be identified by words such as "believe", "expects", "will", "intends", "plans", "projects", "anticipates", "estimates", "continues", and similar expressions. Although management believes that expectations represented in such forward-looking statements are reasonable, there can be no assurance that they will prove to be correct.

By their nature, forward-looking statements include assumptions and are subject to inherent risks and uncertainties that could cause actual future results, conditions, actions or events to differ materially from those in the forward-looking statements. If and when forward-looking statements are set out in this news release, PharmaGap will also set out the material risk factors or assumptions used to develop the forward-looking statements. Except as expressly required by applicable securities laws, the Company assumes no obligation to update or revise any forward-looking statements. The future outcomes that relate to forward-looking statements may be influenced by many factors, including, but not limited to: results of ongoing product testing and development; regulatory approvals required to complete development of products; ability to manufacture product at quality and scale for human use on an economically sound basis; patient reimbursement by private and public health insurance programs; unintended side effects of products; competitive products; product liability; intellectual property; reliance on key personnel; risks of future legal proceedings; income tax matters; availability and terms of financing; distribution of securities; effect of market interest rates on price of securities, and potential dilution.

Note: Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. No Securities Commission or other regulatory authority having jurisdiction over PharmaGap has approved or disapproved of the information contained herein. This release contains forward looking statements that may not occur or may change materially. 

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