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Medgenics, Inc. Raises $9.5 Million In Private Placement

Medgenics, Inc. (NYSE MKT: MDGN and AIM: MEDU, MEDG), the developer of a novel Biopump™ technology for the sustained production and delivery of therapeutic proteins in patients using their own tissue, today announced it has raised gross proceeds of approximately $9.5 million (approximately $8.4 million net) through the sale of 1,944,734 units (the “Units”), with each Unit consisting of one share of the Company’s Common Stock, $0.0001 par value per share (the “Common Stock”), and a warrant to purchase 0.75 of one share of Common Stock (the “Warrants”). Each Unit was sold for a purchase price of $4.90 to institutional and other accredited investors in a private placement transaction. The Warrants expire in five years, have an initial exercise price of $8.34 per full share and become first exercisable on December 15, 2012.

Medgenics intends to use the proceeds from this private placement to further its clinical trial programs for its EPODURE™ Biopump producing erythropoietin for the treatment of anemia, and its INFRADURE™ Biopump producing interferon-alpha for the treatment of hepatitis, as well as for other research and development, patent maintenance and other intellectual property support and general corporate purposes.

The Units, including the Common Stock and the Warrants constituting the Units, and the shares of Common Stock issuable upon the exercise of the Warrants have not been registered under the Securities Act of 1933, as amended, and may not be offered or sold absent registration or an applicable exemption from registration. Medgenics has agreed to cause the resale of the Common Stock issued as part of the Units and the shares of Common Stock issuable upon the exercise of the Warrants to be registered for resale with the U.S. Securities and Exchange Commission.

Maxim Group LLC acted as the exclusive placement agent for the private placement.

“To date in 2012 we have achieved several regulatory milestones towards launching new clinical trials in the U.S. and in Israel. The capital we raised will be applied towards funding key studies in anemia and hepatitis, as well as advancing our technologies along the path towards commercialization,” said Andrew L. Pearlman, Ph.D., President and Chief Executive Officer of Medgenics.

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