QUEBEC CITY, July 12 /CNW Telbec- Medicago announced today the results from two animal studies involving the Company's cholesterol-lowering product candidate, MED-205. Results of the studies provide evidence that MED-205 is effective by oral administration in reducing plasma lipid levels in a high
fat/cholesterol animal model.

MED-205 is a small molecular weight compound extracted from alfalfa plants. Medicago is developing MED-205 as a new treatment for patients with lipid disorders, which can be characterised by excess levels of LDL-cholesterol, often referred to as "bad" cholesterol, and triglycerides.

The animal studies began in May and were designed to investigate the activity and dosage of MED-205 in a hamster model where hamsters were put on a high fat and cholesterol diet. In these studies, MED-205 reduced total plasma cholesterol by 16.5%, LDL-cholesterol by 17.5% and triglycerides by 33% within the 21 days of treatment.

"It is very satisfying to see this new compound exhibit such clear potential for in vivo cholesterol lowering activity. The results demonstrate a significant reduction in LDL levels and triglyceride and provide an insight into the development path for MED-205" said Dr. Louis Vézina, Vice-President Research and Development of Medicago Inc.

Medicago intends to develop MED-205 as a chronic therapy to complement existing medications such as statins. Medicago has filed a U.S. patent application on MED-205 and the extraction process from plants. Medicago expects to initiate additional studies of MED-205 and to start to look for a major partner in the first half of 2007.

"We see great potential in the application of this product candidate for the treatment of lipid disorders and are greatly encouraged by these positive results" stated Mr. Andy Sheldon, President and CEO of Medicago Inc. "With the results from these studies, significant progress in the development of a robust extraction process and the filing of a patent application, Medicago is well positioned to develop an innovative product aimed at tackling the major health problem of high cholesterol."

About Medicago:

Medicago is a biotechnology company focused on the development, production and commercialization of protein-based biopharmaceuticals using a proprietary manufacturing system developed from its expertise in the genetic engineering of plants.

Medicago's Proficia(TM) technology offers speed, flexibility and cost advantages that can greatly improve the accessibility of today's emerging biopharmaceuticals for both partners and patients.

The company has established collaboration agreements with Acambis PLC (NASDAQ: ACAM - www.acambis.com) and InterveXion Therapeutics LLC (www.intervexion.com) for the development of several products and is also developing its own proprietary pipeline.

For additional information, please visit Medicago web site at www.medicago.com.

This press release contains forward-looking statements which reflect the Company's current expectations regarding future events. The forward-looking statements involve risks and uncertainties. Actual results could differ materially from those projected herein. The Company disclaims any obligation to update these forward-looking statements.

For further information: Mr. Frederic Ors, (418) 658-9393,
info@medicago.com; www.medicago.com;
Source: Medicago