ConjuChem raises $5 million in non-dilutive financing

    MONTREAL, July 8 /CNW/ - ConjuChem Biotechnologies Inc (TSX:CJB) today
announced that it has entered into an agreement with Colabor Income Fund
(TSX:CLB.UN), a Québec-based income trust, that will provide gross proceeds of
approximately $5 million in non-dilutive capital to ConjuChem concurrent with
a reorganization of the Company.
    "This non-dilutive transaction, accomplished in a challenging economic
environment, strengthens our balance sheet and provides us with greater
flexibility as we pursue a partnership for our lead diabetes drug,
PC-DAC(TM):Exendin-4," said Mark Perrin, President and CEO. "We recently
reported results from the Phase II program for PC-DAC(TM):Exendin-4 at the
American Diabetes Association's 69th Annual Scientific Sessions demonstrating
that our long-lasting GLP-1 agonist achieved statistically significant
reductions in HbA1c and weight and was extremely well tolerated."
    The non-dilutive transaction involves a corporate reorganization to be
completed under a court supervised Plan of Arrangement. ConjuChem will
transfer its assets and liabilities, including the proceeds from this
transaction, to a newly incorporated subsidiary company, 4523482 Canada Inc.
("New ConjuChem OpCo"). On completion of the transaction, ConjuChem
securityholders will have exchanged their ConjuChem securities on a
one-for-one basis for securities of a parent company of New ConjuChem OpCo
which shall subsequently amalgamate with New ConjuChem OpCo ("New ConjuChem").
    New ConjuChem will carry on ConjuChem's business operations as a public
entity and will retain all rights to related intellectual property as before
the transaction.
    As part of the Plan of Arrangement, Colabor unitholders, on completion of
the transaction, will own 100% of the shares of the original ConjuChem entity.
    Completion of the transaction is subject to receipt of court and other
regulatory approvals and consents. It must also be approved (i) by at least 66
2/3 percent of votes cast by ConjuChem shareholders, (ii) at least 66 2/3
percent of votes cast by ConjuChem optionholders, warrantholders and
debentureholders, and (iii) by at least 66 2/3 percent of votes cast by
Colabor unitholders. Based on a number of factors, including a fairness
opinion rendered by ConjuChem's financial advisor for the transaction,
ConjuChem's Board of Directors unanimously recommends that ConjuChem
securityholders approve the transaction.
    Additional details regarding the transaction will be provided to
ConjuChem securityholders in an information circular to be mailed in mid-July.
The information circular will also be available at www.conjuchem.com and
www.sedar.com. A special meeting of securityholders will be held in August
2009 at the offices of McCarthy Tétrault LLP, Suite 2500, 1000, De La
Gauchetière Street West, Montréal, Québec. The transaction is expected to
close in August 2009 subject to the satisfaction of customary closing
conditions.

    About ConjuChem Biotechnologies Inc.

    ConjuChem, a developer of next generation medicines from therapeutic
peptides, creates long-acting compounds based on its proprietary
bioconjugation platform technology. ConjuChem has two major development
programs: PC-DAC(TM):Exendin-4, a GLP-1 receptor agonist in Phase II clinical
development and PC-Insulin, a long-acting basal insulin in preclinical
development.
    Detailed descriptions of ConjuChem and its technologies can be viewed on
ConjuChem's website www.conjuchem.com.

    Forward-Looking Statements

    This press release contains certain forward-looking statements,
including, without limitation, statements containing the words "believe",
"may", "plan", "will", "estimate", "continue", "anticipate", "intend",
"expect" and other similar expressions which constitute "forward-looking
information" within the meaning of applicable Canadian securities laws.
Forward-looking statements reflect ConjuChem's current expectation and
assumptions, and are subject to a number of risks and uncertainties that could
cause actual results to differ materially from those anticipated. These
forward-looking statements involve risks and uncertainties including, but not
limited to, the obtaining of court and other regulatory approvals and
consents, the satisfaction of closing conditions, adjustment provisions
relating to the proceeds of the transaction, changing market conditions, the
successful and timely completion of clinical studies, the establishment of
corporate alliances, the impact of competitive products and pricing, new
product development, uncertainties related to the regulatory approval process
and other risks detailed from time-to-time in ConjuChem's ongoing filings with
the Canadian securities regulatory authorities which filings can be found at
www.sedar.com. Given these risks and uncertainties, readers are cautioned not
to place undue reliance on such forward-looking statements. ConjuChem
undertakes no obligation to publicly update or revise any forward-looking
statements either as a result of new information, future events or otherwise,
except as required by applicable Canadian securities laws.

For further information: Mark Perrin, President and CEO, ConjuChem
Biotechnologies Inc., [phone] ext. 311, [e-mail]; James
Smith, Investor Relations, [phone] ext. 229, [e-mail]