Pro-Pharmaceuticals (PRW) Anticipates Listing on Bulletin Board; Releases President and Chief Scientist

December 31, 2008 7:40 AM EST

Pro-Pharmaceuticals, Inc. (AMEX: PRW) announces updates regarding the company's proposed rights offering, pre-New Drug Application (NDA) filing and related meeting with the U.S. Food and Drug Administration (FDA) regarding the company's lead product candidate DAVANAT(R), NYSE Alternext US stock listing, and cash saving initiatives.

On December 23, 2008, the company met with the NYSE Alternext US ("Exchange") to appeal the Exchange's decision to begin the de-listing process of the company's common stock. The company is out-of-compliance with Section 1003(a)(ii) of the Exchange's Company Guide. On December 30, 2008, the Exchange notified the company that it has denied the company's appeal and will begin the de-listing process in accordance with Exchange rules. The company anticipates that its shares will be listed for quotation on the Over-the-Counter Bulletin Board (OTCBB) or another market and has begun the OTCBB listing process. The company will notify investors of its new stock symbol as soon as it becomes available.

The company is completing all of the state securities filings for its proposed rights offering to its shareholders and expects to begin marketing the rights offering in January 2009. The company filed a registration statement with the Securities and Exchange Commission (SEC) in mid-November for its rights offering in which it plans to distribute, at no charge to its existing holders of the company's common stock on the record date, subscription rights to purchase shares of its common stock and warrants. The company plans to file an amended registration statement with the SEC as soon as it receives approvals from applicable state securities authorities.

The company expects to use the proceeds from the rights offering to complete the submission of a NDA to the FDA for DAVANAT(R) to be co-administered with 5-Fluorouracil (5-FU) to treat late-stage colorectal cancer patients. The company had a pre-NDA meeting with the FDA on December 22, 2008 to review the PK study which the company believes is needed to complete the NDA filing. The company plans to announce the results of that meeting as soon as it receives the FDA's comments, which are expected in January 2009.

The company also announced that it has released three employees, including its president and chief scientist, and reduced non-strategic expenses in order to extend its cash runway through January 2009.[SM]

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