Pegasus Completes First Phase Testing of Non-Toxic, Environmentally Friendly, Mold & Mildew Resistant, Water-Based Paint for a Growing $10 Billion Market

Pegasus Pharmaceuticals (PINKSHEETS: PGUZ) today announced that it has recently developed and tested a non-toxic, environmentally friendly additives package to make water-based paints mold and mildew resistant. The concept of this product extension is based on Pegasus' patented, laboratory-proven biological, anti-mold and mildew product, Mold Gone(TM).

Pegasus is committed to the global battle against toxic mold in both the consumer and industrial markets. The Company has teamed up with several of the world's leading paint manufacturers in order to participate in a new market direction to develop mold and mildew resistant products which focus on preservation, safety, the environment and economic efficiencies. Paint manufacturers are now answering the demand for environmentally safe water-based paints, which has a rapidly growing, worldwide market valued at more than $10 billion USD in 2008.

In the most recent tests conducted by an independent laboratory, drywall material was painted with newly formulated mold and mildew resistant paint. The same paint sample without Mold Gone(TM) was used as the control. Mold suspension was sprayed over the painted drywall. The suspension consisted of equal volumes of 5 mold spore suspensions from 100,000 to 200,000 spores per ml. Drywall with a concentration of 1,000,000 spores per square inch was incubated for 30 days in a high humidity chamber at 28-30°C, and were examined weekly for visible effects of mold growth. The drywall painted with mold and mildew resistant paint containing Pegasus' additives package had no sign of mold growth 30 days after the treatment with mold spores. The control sample without the additive package showed moderate mold growth at the end of the first week, and had heavy mold growth during the second week and the subsequent weeks thereafter. Pegasus Pharmaceuticals will continue with a thorough testing program of its water-soluble paints additive package in the coming months in preparation for the commercial applications of water-soluble paints for the world market.

Pegasus' Mold Gone(TM) product represents a breakthrough in mold control technology. It has demonstrated a remarkable 100% efficiency rate (0% mold growth) over a 100-day period and far outperformed four other leading U.S. anti-mold products. The product's active ingredients are non-toxic, biodegradable and are naturally occurring. The product represents a new era in anti-microbial, anti-fungal protection because it not only removes black mold infestation, it also cleans and disinfects surfaces, preventing further mold spore growth in residential, commercial or institutional applications.

For more information, visit the Company's website: www.pegasusbiosciences.com or contact Paul Davey, Investor Services at: 778-389-0915. Email: paul@pegasusbiosciences.com , or call Daniel Kesonen, Chairman & CEO, Pegasus Pharmaceuticals, Inc. at 561-626-9901. Pegasus Pharmaceuticals adheres to the statutes and provisions of the Safe Harbor Act.