SemBioSys receives US$2.5 million from option agreement with MannKind for plant-produced insulin

SemBioSys Genetics Inc. (TSX:SBS), a biotechnology company developing protein pharmaceuticals in crop plants, today announced it has received US$2,500,000 from MannKind Corporation (Nasdaq:MNKD) as consideration for the option agreement and issuance of 2,400,000 units of SemBioSys, as previously announced December 24, 2008. The transaction provides MannKind with the option to the license rights to SemBioSys' proprietary plant-produced recombinant human insulin for use primarily in MannKind's ultra-rapid acting insulin, AFRESA(TM).

The units were issued at a price US$0.83 (Cdn$1.00) per unit. Each unit issued by SemBioSys consists of one common share of SemBioSys and one-tenth of one common share purchase warrant of SemBioSys.

Each whole warrant entitles MannKind to purchase one additional common share of SemBioSys at an exercise price of Cdn$6.00 for a period of 36 months from the effective date of the option. The option period for the license rights ends on March 31, 2009.

About SBS Plant-Produced Insulin

SemBioSys' plant-produced insulin is human insulin produced from genetically enhanced safflower. SemBioSys has demonstrated that its plant-produced insulin is physically, structurally and functionally indistinguishable from pharmaceutical-grade human insulin through analytical testing and pre-clinical sub-chronic toxicology studies in rodents and primates. SemBioSys is currently conducting a Phase I/II clinical trial of its plant-produced insulin. The three-arm study, of up to 30 healthy volunteers, is designed to demonstrate the bioequivalence of safflower-produced insulin to two commercial insulin standards. Full results are expected to be available during the first half of 2009.

About SemBioSys

Calgary, Alberta-based SemBioSys is a biotechnology company developing protein-based pharmaceuticals using its proprietary protein production technology. This technology enables the production of therapeutic proteins in plant seeds by genetically enhancing the safflower plant. SemBioSys' lead pharmaceutical candidates are recombinant human insulin, which is intended to serve the rapidly expanding global diabetes market, and Apo AI(Milano). Apo AI(Milano) is a variant of Apo AI, the major protein associated with high density lipoprotein (HDL), or "good cholesterol", whose function is to remove excess cholesterol from arteries. In addition to its pharmaceutical products, SemBioSys' subsidiary, Botaneco Specialty Ingredients Inc., is selling oleosome-based all natural products in the global personal care ingredient market. More information is available and can be accessed at www.sembiosys.com.

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 securities laws. Forward-looking statements reflect the Company'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, changing market conditions and market size, the acceptance of an IND by the FDA in respect of clinical studies, the submission of a CTA to the appropriate European authorities, the successful initiation and timely and successful completion of clinical studies, the fact that Apo AI is currently a development stage drug, 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 the Company'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. The Company 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.

SOURCE: SemBioSys Genetics Inc.

SemBioSys Genetics Inc., Andrew Baum, President and CEO, Phone: (403) 717-8767,
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