05.07.2007

PharmaGap Receives TSX-V Approval for $550,000 Investment by Dundee Securities; Sale of $1.95 million in Shares and Warrants to Accredited Investors Initiated

Ottawa, Ontario/ May 7, 2007 – PharmaGap Inc. (TSX-V: GAP) (“PharmaGap” or “the Company”), a Canadian biotechnology company developing novel compounds to treat cancer, today announced that it has received approval  from the TSX Venture Exchange (“TSX-V”) for the investment by Dundee Securities Corporation (“Dundee”) of $550,000 in equity securities.  The Company first announced the investment by Dundee on May 3, 2007.

Dundee has acquired 2,000,000 common equity units (“Units”) and 2,400,000 Series I Preferred Shares (“Series I Shares”) from the Company.  As a result of the issue the Company now has 21,374,620 common shares outstanding and 2,400,000 Series I Shares outstanding.  Dundee owns 9.4% of the common shares outstanding.  The securities issued (including the common shares, the warrants and the Series I Shares) will be subject to a hold period of at least four months and one day from May 4, 2007, pursuant to TSX-V policies and to Multilateral Instrument 45-102 – Resale of Securities. 

The Company is also offering by way of a private placement up to $1,950,000 of Units to accredited investors at the same price as were issued to Dundee.  The Units are being offered at $0.125 per Unit and consist of one common share and one warrant to acquire a common share for a two-year period at $0.165.  The sale of securities to accredited investors is set to close on or before June 4, 2007.  The Company has received TSX-V conditional acceptance for the purchase of the Units by accredited investors.

Pursuant to an agency agreement between the Company and Dundee, Dundee will be paid a commission of 10% of the aggregate gross proceeds of the private placement and will also receive broker’s warrants in an amount equal to 10% of the number of Units issued in the private placement.  The broker’s warrants have an exercise price of $0.165 per common share and a two-year term from date of issue.  In connection with today’s announcement, Dundee received a commission payment of $55,000 and 200,000 broker’s warrants, respectively.  A selling commission from Dundee is payable to other brokers with orders from accredited investors.

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.

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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.