PharmaGap Completes Sale of Equity Units



    OTTAWA, June 15 /CNW Telbec/ - PharmaGap Inc. (TSX-V: GAP) ("PharmaGap"
or "the Company"), a Canadian biotechnology company developing novel compounds
to treat cancer, today announced it has closed the issuance of equity
securities to accredited investors in Canada for total aggregate proceeds of
$1,000,450.
    Robert McInnis, President and C.E.O. of the Company, commented that "We
are delighted that the markets see the potential in our Company and cancer
drug technology, as evidenced by our ability to complete this issuance of just
over $1 million. We are applying these funds to proceed with additional animal
trials of our lead cancer drug PhGalpha1, additional testing of the drug at
Memorial Sloan Kettering Cancer Center, and to working capital requirements.
This next round of testing of the drug in animals, anticipated to commence in
July 2007, is designed to produce data requested by potential development and
licensing partners in the pharmaceutical industry. Based on all testing and
development work already completed, our scientific team is confident that
PhGalpha1 will continue to demonstrate performance as designed."
    Investors purchased a total of 5,603,000 common equity units ("Units")
from the Company at a price of $0.125 per Unit, in two separate closings on
May 4, 2007 (2,000,000 Units) and June 14, 2007 (3,603,000 Units). Each Unit
consists of one common share and one warrant to acquire a common share for a
two-year period at an exercise price of $0.165 per common share. The common
shares and warrants issued will be subject to a hold period until September 5,
2007 and October 15, 2007 respectively, pursuant to TSX Venture Exchange
policies and to Multilateral Instrument 45-102 - Resale of Securities. On May
4, 2007 the Company also closed the issuance of 2,400,000 Series I Preferred
Shares ("Series I Shares"), as part of the same offering. The Series I Shares
are priced at $0.125 per Series I Share and are convertible at the request of
the holder into Units on a one for one basis at no further cost. The Series I
Shares carry no fixed dividend and have no priority on liquidation. Series I
Shares are eligible to vote in all votes of common shareholders to the extent
of one vote for every one hundred Series I Shares held, and are subject to a
voting agreement that directs Series I Share votes to be cast in favour of the
majority of the common shares voted. As a result of the issue the Company now
has 24,978,220 common shares and 2,400,000 Series 1 Shares outstanding.
    Pursuant to an agency agreement between the Company, Dundee Securities
Corporation ("Dundee") and Wellington West Capital Inc. (Wellington")
(collectively, the "Agents"), the Agents are paid a commission of $55,000
(Dundee) and $26,850 ((Wellington) and will also receive 200,000 broker's
warrants (Dundee) and 214,800 broker's warrants (Wellington) respectively. The
broker's warrants have an exercise price of $0.165 per common share and a two
year term from date of issue of the Units placed by the respective Agent. The
Company also paid an additional $20,736.50 in finder's fees to certain other
parties in connection with the offering.

    About PharmaGap Inc.

    PharmaGap Inc. (TSX-V: GAP), based in Ottawa, ON, is a biotechnology
company with a core focus on developing novel therapeutic compounds for the
treatment of cancer. PharmaGap's research platform targets cellular signaling
pathways controlled by Protein Kinase C (PKC) isoforms. PharmaGap's lead drug
compound, PhGalpha1, is in preclinical development. The Company's strategy is
to out-license drug compounds to larger life sciences companies at the
preclinical stage. For more information please visit the Company's website at
www.pharmagap.com.

    Note: The TSX Venture Exchange does not accept 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.




For further information:

For further information: relating to this release, please contact:
Robert McInnis, President & CEO, (613) 990-9551, bmcinnis@pharmagap.com

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