Pro-Pharmaceuticals Reports Full Year and Fourth Quarter 2008 Financial Results

NEWTON, Mass.--(Business Wire)--
Pro-Pharmaceuticals, Inc. (OTC: PRWP.OB), a developer of carbohydrate-based
targeted therapeutic compounds to treat cancer and fibrosis, today reported its
full year and fourth quarter financial results, for the period ended December
31, 2008.

"We continue to make progress towards our goal to commercialize DAVANAT®," said
Theodore Zucconi, Ph.D., Chief Executive Officer, Pro-Pharmaceuticals. "The
results from our Phase II trial for late stage colorectal cancer patients show
DAVANAT®, when co-administered with 5-FU, extended the median survival of
patients to 6.7 months compared with 4.6 months for patients that were
previously heavily treated with other therapies. We filed a Drug master File
(DMF) for DAVANAT® with the FDA. We believe the DMF represents a significant
milestone in the commercialization of DAVANAT® because it demonstrates our
ability to produce commercial quantities of pharmaceutical-grade DAVANAT® under
current Good Manufacturing Process standards. We entered into agreements with
potential distributors for DAVANAT® in the Mid-East and Korea and we are
actively engaged with potential partners in South America. Our goal is to file a
New Drug Application (NDA) to commercialize DAVANAT®."

For the full year ended December 31, 2008, the Company reported an operating
loss of approximately $5.3 million compared with an operating loss of
approximately $6.5 million for the full year 2007. The net loss available to
common stockholders for 2008 was $3.4 million, or ($0.07) per share basic and
fully diluted, compared with a net loss available to common stockholders of
approximately $9.4 million, or ($0.24) per share basic and fully diluted in
2007. Approximately $2.1 million of the 2008 results was non-cash income related
to change in fair value accounting for warrants as compared with $3.1 million of
expense for convertible debentures, warrants and non-cash interest expense in
the 2007 results. The 2008 results included approximately $239,000 of preferred
stock dividends. There were no preferred stock dividends in 2007.

Research and development expense for 2008 was approximately $1.8 million
compared with approximately $2.1 million for 2007. The decrease in 2008 was due
primarily to lower expenses relating to two clinical trials that were put on
hold due to financial constraints as the Company focused on filing the DMF. A
DMF contains confidential detailed information in support of the NDA about
facilities, processes or articles used in the chemistry, manufacturing,
controls, processing, packaging, and storing or stability of drugs. A DMF can be
cross-referenced by potential partners to use in combination with other
therapies to expedite clinical studies and submission of NDAs.

General and Administrative expense for 2008 was approximately $3.6 million,
compared with approximately $4.4 million for the full year 2007. The decrease in
2008 is primarily the result of lower legal and accounting expense as well as
lower payroll expense, due principally to employees taking reduced salaries to
conserve cash.

At December 31, 2008, the Company had unrestricted cash of approximately
$318,000. In February 2009, the Company raised net proceeds of approximately
$1.5 million from a private placement.

For the fourth quarter of 2008, the Company reported an operating loss of
approximately $1.1 million compared with an operating loss of approximately $1.4
million for the fourth quarter of 2007. The net loss available to common
stockholders for the fourth quarter of 2008 was approximately $900,000, or
($0.02) per share basic and fully diluted, compared with a net loss available to
common stockholders of approximately $1.3 million, or ($0.03) per share basic
and fully diluted in 2007. Approximately $300,000 of the fourth quarter 2008
results was non-cash income related to change in fair value accounting for
warrants as compared with approximately $100,000 of non-cash expense for
convertible debentures, warrants and interest expense in the 2007 results. The
fourth quarter 2008 results included approximately $52,000 of preferred stock
dividends. There were no preferred stock dividends in 2007.

Research and development expense for the fourth quarter of 2008 was
approximately $300,000 compared with approximately $400,000 for 2007. The
decrease in the fourth quarter of 2008 was due primarily to lower expenses
relating to two clinical trials that were put on hold due to financial
constraints as the Company focused on filing the DMF.

General and Administrative expense for the fourth quarter of 2008 was
approximately $800,000, compared with approximately $1.0 million in the fourth
quarter of 2007. The decrease in 2008 is primarily the result of lower legal and
accounting expense as well as lower payroll expense, due principally to
employees taking reduced salaries to conserve cash.

Annual Shareholders Meeting

The Company`s Annual Meeting of Shareholders is scheduled to be held on May 21st
at the Sheraton Needham Hotel in Needham, Massachusetts.

Pro-Pharmaceuticals, Inc.

Pro-Pharmaceuticals is a clinical stage company engaged in the discovery,
development and commercialization of carbohydrate-based, target therapeutic
compounds for advanced treatment of cancer, liver, microbial and inflammatory
diseases. The Company`s initial focus is the development of carbohydrate
polymers to treat cancer patients. DAVANAT®, the Company`s lead product
candidate, is a polysaccharide drug whose mechanism of action is based upon
binding to lectins on the cell surface. This form of target therapy may allow
for higher doses of chemotherapy administration with no increase in toxicity.
The Company`s technology is also being developed as new chemical entities to
treat serious diseases such as liver and kidney fibrosis. The Company is
headquartered in Newton, Mass. Additional information is available at
www.pro-pharmaceuticals.com.

FORWARD LOOKING STATEMENTS: Any statements in this news release about future
expectations, plans and prospects for the Company constitute forward-looking
statements as defined in the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements are based on
management`s current expectations and are subject to a number of factors and
uncertainties, which could cause actual results to differ materially from those
described in such statements. We caution investors that actual results or
business conditions may differ materially from those projected or suggested in
forward-looking statements as a result of various factors and not place undue
reliance on forward-looking statements.

More information about those risks and uncertainties is contained and discussed
in the Company`s most recent quarterly or annual report and in the Company`s
other reports filed with the Securities and Exchange Commission. The
forward-looking statements represent the Company`s views as of the date of this
news release and should not be relied upon to represent the Company`s views as
of a subsequent date. While the Company anticipates that subsequent events may
cause the Company`s views to change, the Company disclaims any obligation to
update such forward-looking statements.

DAVANAT is a registered trademark of Pro-Pharmaceuticals.

Pro-Pharmaceuticals, Inc.
Anthony D. Squeglia, 617-559-0033
squeglia@pro-pharmaceuticals.com

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