Thallion Pharmaceuticals Inc. Announces Completion of $8.85 Million Non-Dilutive Capital Transaction

MONTREAL, QUEBEC--(Marketwire - July 22, 2009) - Thallion Pharmaceuticals Inc. (TSX: TLN) (“Thallion” or the “Company”) today announced the completion of the transaction providing $8.85 million in new, non-dilutive capital to the Company. The Superior Court of Quebec has approved the previously announced plan of arrangement (the “Arrangement”) under section 192 of the Canada Business Corporations Act (the “CBCA”) involving Thallion and Premium Brands Income Fund (“Premium Brands”), among others, all as fully described in Thallion’s management information circular dated June 11, 2009.

“This capital infusion strengthens our balance sheet without diluting our existing shareholders,” said Lloyd M. Segal, Chief Executive Officer of Thallion Pharmaceuticals Inc. “This transaction significantly extends the Company’s cash runway well into 2011 and greatly enhances our ability to execute our business plan, including advancing our clinical product pipeline and partnering strategies.”

Thallion expects to net approximately $8 million after accounting for expected transaction-related costs. Together with the Company’s unaudited proforma cash balance, Thallion’s cash, cash equivalents and short-term investments represent approximately $0.41 per share at closing and the Company’s liquidity availability represents approximately $0.46 per share when including investment tax credits receivable.

As part of the transaction, Thallion will carry on its business operations as they existed immediately prior to the Arrangement in a new entity, named “Thallion Pharmaceuticals Inc.”, owned by the former shareholders of Thallion, but with the additional cash received from Premium Brands. The common shares of the new entity are listed on the Toronto Stock Exchange under the same stock symbol “TLN” as of today.

About Thallion Pharmaceuticals Inc.

Thallion Pharmaceuticals Inc. (TSX: TLN) is a biotechnology company developing pharmaceutical products in the areas of oncology and infectious disease. Thallion has three clinical programs at the Phase II stage of development. The two oncology product candidates include TLN-4601, a novel anti-cancer therapy targeting the RAS-MAPK pathway, and TLN-232. TLN-4601 is currently recruiting patients in a multi-centre, Phase II trials in Canada and the United States. Thallion’s third product candidate, Shigamabs®, is a dual antibody product for the treatment of Shigatoxin producing E. coli bacterial infections. Additional information about Thallion can be obtained at www.thallion.com.

Forward-Looking Statements

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 Canadian securities laws. Forward-looking statements reflect Thallion’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, the obtaining of regulatory approvals and consents, changing market conditions, the successful and timely completion of clinical studies, 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 Thallion’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. Thallion 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.