Diffusion Pharmaceuticals Successfully Completes First Cohort in Multicenter Phase I/II Brain Cancer Trial of TSC

Clinical development of (TSC) to continue at 20 major U.S. cancer institutions

Diffusion Pharmaceuticals Successfully Completes First Cohort in Multicenter Phase I/II Brain Cancer Trial of TSC

<0> Diffusion Pharmaceuticals LLCMedia:David G. Kalergis, MBA/JDCEO434-220-0718orGBM Study Information:Kim Whitten, Pharm.D,Vice President, Drug Development434-220-0718 </0>

Diffusion Pharmaceuticals LLC, a biotechnology company focused on innovative cancer treatments, today announced that it has successfully completed the first cohort in a Phase I/II clinical trial testing its lead compound (TSC) in newly diagnosed primary brain cancer patients. All patients in this cohort were treated at the University of Virginia Medical Center in Charlottesville, Virginia. Eleven more institutions have been opened for the second cohort, which has begun enrolling patients. An additional eight institutions will be initiated during the third quarter of 2012, for a total of 20 institutions to enroll 59 patients in the study by the first quarter of 2013.

Patients enrolled in the first cohort were treated with TSC for three doses a week over three weeks during radiation therapy. TSC was dosed in conjunction with the existing standard of care (radiation and chemotherapy) for newly diagnosed primary brain cancer, also known as glioblastoma multiforme or GBM. An independent Safety Monitoring Committee met on July 17, 2012, and authorized enrollment to begin in Cohort 2 after determining that no dose-limiting toxicities had occurred and that TSC was well-tolerated in these patients.

"The recommendation from the independent Safety Monitoring Committee confirms the excellent clinical safety profile seen previously in TSC," said David G. Kalergis, Diffusion Pharmaceuticals’ CEO. "Enrollment of the second cohort is already underway, and we are on schedule to meet our goal of full study enrollment and efficacy evaluations during the next year."

Dr. James Larner and Dr. Jason Sheehan of the University of Virginia Medical Center are Study Co-Chairs for this trial. A listing of all trial sites, including contact information, may be viewed online at .

Diffusion Pharmaceuticals is a clinical-stage company developing first-in-class drugs which target the numerous unmet medical needs characterized by oxygen deprivation (hypoxia) at the cellular level. These proprietary small molecules work by a novel mechanism of action that enhances the diffusion of oxygen selectively to hypoxic tissue. Potential breakthrough clinical applications include oncology, cardiovascular diseases, stroke and respiratory disorders. Diffusion’s lead program is the use of TSC in the treatment of solid cancerous tumors. Published studies demonstrate a tripling of survival and superior tumor control when TSC is combined with radiation and chemotherapy in animal models of primary brain cancer. A phase I/II clinical study of TSC dosed concomitantly with radiation and chemotherapy in newly diagnosed GBM patients is currently enrolling patients. Diffusion Pharmaceuticals, which is privately held, is located in Charlottesville, Virginia. For more information, visit .