Gem Pharmaceuticals announced today that current Gem boardmembers/investors Diane Hendricks and Karl Leo have agreed to provide up to $4.5 million in new capital in order to fund the Company's upcoming Phase 2 clinical trial of GPX-150 in sarcoma patients. These funds will be invested over the course of the trial.

GPX-150, Gem's lead anthracycline analogue, is a patented, chemically modified version of doxorubicin that is designed to eliminate this widely used anti-cancer agent's dose-limiting cardiotoxic side effects. GPX-150 has successfully completed a Phase 1 dose-escalation clinical study that demonstrated anti-tumor activity in some late-stage cancer patients without causing measurable cardiotoxicity. The maximum tolerated dose was determined based on the occurrence of Grade 3 and 4 neutropenia, which was resolvable upon dose reduction and is thought to be an 'on-target' effect of the compound's anti-cancer activity. GPX-150 has been specifically designed to improve the therapeutic window as compared to doxorubicin; part of the way in which this is believed to be achieved is by GPX-150's increased selectivity at inhibiting the enzyme topoisomerase-2 alpha versus topoisomerase-2 beta. This key feature means that GPX-150 has the potential to be the first-ever 'targeted' anthracycline compound.

'We certainly appreciate the continued support shown by our current investor group, and we may also seek to supplement this new funding with additional financing from venture capital investors or a corporate partner in order to expand our clinical development program,' said Gem CEO Arthur Klausner.

'This financing represents a seminal event in Gem's development,' added Gem boardmember Donald Drakeman, former CEO of the biotechnology company Medarex. 'The Phase 2 study should be able to demonstrate whether the promising preclinical and early clinical results seen with GPX-150 can in fact translate into a cancer patient population that is truly in need of improved therapeutic options.'

About Gem Pharmaceuticals

Gem Pharmaceuticals is a clinical-stage biopharmaceutical company developing proprietary anthracycline derivatives specifically designed to eliminate the critical cardiotoxicity side effect of this powerful class of chemotherapeutics while maintaining their well-documented anti-cancer efficacy. In so doing, Gem seeks to transform traditional broad-spectrum cytotoxic drugs into modern - and biochemically targeted - anti-cancer agents that hold the potential for higher dosing and correspondingly improved therapeutic utility. Gem believes that its lead non-cardiotoxic anthracycline compound (GPX-150) has the potential to attain significant market penetration by replacing the existing use of doxorubicin and other anthracyclines; by expanding the oncology uses of anthracyclines; and by broadening anthracycline use beyond cancer. For additional information about Gem, please visit www.gempharmaceuticals.com.