SYGNIS Pharma AG Proposes Reduction of Share Capital to Improve Flexibility on Capital Markets

Heidelberg, October 20, 2010 – SYGNIS Pharma AG (Frankfurt: LIO; ISIN DE0005043509; Prime Standard), a clinical stage biotech company developing innovative CNS treatments, has invited shareholders to its Annual General Meeting for financial year 2009 / 2010 on November 30, 2010. At the meeting the Board will propose a reduction of the Company’s share capital according to §§ 222 ff. German Stock Corporation Act (AktG).

This reduction will be combined with a consolidation of the shares in a 3:1 ratio. As a result, the share capital will be reduced from € 41,258,643 to € 13,752,881, allocated to 13,752,881 shares outstanding.

The purpose of this process is primarily to improve the Company’s abilities to interact on the capital markets. The planned measure is based on the fact that the Company’s share price has been below the nominal value of € 1 for a longer period. Following the capital reduction and consolidation of shares, the share price is expected to increase significantly to a level above the nominal value.

The SYGNIS share will thus comply with the relevant requirements and will be more attractive for investors. Furthermore, the planned measure will improve the flexibility of the company for future capital measures and the development of financing alternatives. The released capital will be used for the reduction of losses.

As of June 30, 2010 the liquidity of the company was €13.1 million.

About SYGNIS Pharma

SYGNIS Pharma AG, headquartered in Heidelberg, is a biopharmaceutical company listed on the Prime Standard of the German stock exchange. The Company is focused on the research, development and marketing of innovative therapies for the treatment of disorders of the Central Nervous System. These include stroke and various forms of dementia. These disorders are characterized by an acute or gradual loss of nerve cells, which for the patients always means a decline of functional abilities. Although there is great medical demand, there are currently no or only inadequate treatment options available.

One of the central elements in the Company’s value-creation chain is the continued development of the existing product pipeline. This is achieved by testing the Company’s proprietary compounds, which are already under development in a number of further CNS indications. Within specific R&D programs at SYGNIS, new pre-clinical drug candidates are identified and evaluated as well as early-stage projects are initiated for the purpose of partnering.

For further information please contact: SYGNIS Pharma AG: Dr. Franz-Werner Haas Vice President Operations +49 (0) 6221 454 812 franz-werner.haas@sygnis.de

Media-Contact: Julia Phillips Financial Dynamics Tel.: +44 (0) 20 7269 7187