D-Pharm Signs Deal With Jiangsu NHWA Pharmaceutical for Development and Commercialization of DP-VPA in China

REHOVOT, Israel, May 31, 2011 -

D-Pharm Ltd. (TASE: DPRM) announced today that it has entered
into a licensing and co-development agreement with Jiangsu NHWA
Pharmaceutical Co., Ltd.(NHWA) to commercialize DP-VPA for epilepsy in the
People's Republic of China. DP-VPA is a novel drug discovered and developed
by D-Pharm for treatment of patients with epilepsy, migraine and bipolar
disorder. DP-VPA has completed a first Phase II study in epilepsy patients.

(Logo: www.newscom.com/cgi-bin/prnh/20100415/386828 )

Under the terms of the agreement D-Pharm will receive up-front
and development milestone payments. In addition, upon reaching defined annual
sales NHWA will pay to D-Pharm annual sales bonuses and royalties on DP-VPA
sales over a certain threshold in China.

NHWA will be responsible for development, manufacturing and
commercialization of DP-VPA in China. The development of DP-VPA in China will
be performed in compliance with applicable US FDA standards and will be a
part of the global development effort. D-Pharm and NHWA will also cooperate
on development and optimization of the manufacturing process for DP-VPA.

Dr. Alex Kozak, D-Pharm's CEO, commented: "I am delighted to
have a partnership with NHWA, a prominent pharmaceutical company with an
established presence in the Chinese CNS market. We recognize how important it
is to promote our products in rapidly growing markets. This is D-Pharm's
third licensing agreement with an Asian company. Importantly, the data
generated by NHWA gives us the opportunity to accelerate global development
of DP-VPA."

This partnership was facilitated by Xintech, a company that
specializes in developing technological cooperation between China and Israel
in the life sciences.

About DP-VPA

DP-VPA is a new chemical entity (NCE), rationally designed
utilizing D-Pharm's proprietary technology, Regulated Activation of Prodrugs
(RAP), which enables precise control over drug action at the site of
pathology. In preclinical and clinical studies, DP-VPA demonstrated a
superior safety and pharmacokinetic profile compared to valproic acid.
Valproic acid formulations are first-line drugs for the treatment of epilepsy
in China. Despite excellent efficacy, however, a variety of adverse effects
limit valproic acid's maximum dose and extended use. DP-VPA will provide a
safer, more efficacious alternative to valproic acid.

About Jiangsu NHWA Pharmaceutical Co., Ltd.

Jiangsu NHWA Pharmaceutical Co., Ltd is a pharmaceutical
company that combines science manufacture and trade. NHWA focuses on the CNS
market and is a leader in CNS drug sales in China. NHWA has two large GMP
manufacturing bases for API and Final Product with ISO14001 and EU GMP
certification by the European Union.

About D-Pharm

D-Pharm (www.dpharm.com) is a clinical stage,
biopharmaceutical company pioneering the development of lipid-like
therapeutics, and has generated a rich pipeline of patent protected
proprietary products. D-Pharm's pipeline includes advanced clinical stage
products, DP-b99, in Phase III for treatment of acute ischemic stroke
patients and DP-VPA for treatment of epilepsy, bipolar disorder and
prophylaxis of migraine. DP-460 is in preclinical development intended as an
oral, disease-modifying therapy for Alzheimer's disease. Other mimics of
bioactive lipids, LipidoMimetix, are at an earlier developmental stage for
cancer.

Disclaimer

Statements in this press release that are not historical facts
are forward-looking information, as defined in the Securities Law, based on
information available to D-Pharm at the time of this press release. The
estimations could, some or all, be unrealized, or could be realized in
significantly different ways than expected.

    For further information please contact:

    Tami Horovitz
    Tel: +972-8-9385100
    Fax: +972-8-9300795
    Email: thorovitz@dpharm.com

.