QUÉBEC CITY, QUÉBEC – August 30, 2006 – Medicago Inc. (“Medicago”) is pleased to announce that it has successfully completed its initial public offering of 2,003,834 units (the “Units”) at a price of $1.00 per Unit for gross proceeds of $2,003,834 million, each Unit consisting of one common share of Medicago and one common share purchase warrant. Each share purchase warrant entitles the holder thereof to purchase one common share at a price of $1.10 at any time prior to 5:00 p.m. (Montreal time) on the date that is 24 months following the closing of the offering. The common shares of Medicago commenced trading today on the TSX Venture Exchange under the symbol “MDG”.

Medicago granted to the agent of the offering, Dundee Securities Corporation, a number of compensation options, exercisable at the offering price for a period of 24 months following the closing of the offering, representing 7% of the number of Units to be issued pursuant to the offering.

Concurrently with the closing of the Offering, Medicago granted a total of 800,000 options to its executive officers allocated as follows: 400,000 to Andrew J. Sheldon, 200,000 to Louis-P. Vézina and 200,000 to Pierre Labbé, at an exercise price of $1.00. In addition, the Chairman of the Board and each non-executive director was granted 50,000 and 25,000 options, respectively, at an exercise price of $1.00 per option.

Located in Québec City, Medicago is a biotechnology company focused on the development, production and commercialization of protein-based biopharmaceutical products. Medicago has developed proprietary plant-based manufacturing technologies. These manufacturing technologies significantly decrease the cost of producing and improving access to new biopharmaceutical drugs for both its commercial partners as well as patients.

Medicago has established collaboration agreements with Acambis PLC (NASDAQ: ACAM – www.acambis.com) and InterveXion Therapeutics LLC (www.intervexion.com) for the development of several partner products and is also developing its own proprietary pipeline of products which includes a biogeneric product, aprotinin, as well as a cholesterol-lowering compound that is endogenous to alfalfa.

The common shares of Medicago have not been registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States or to or for the account or benefit of any U.S. person except in compliance with the registration requirements of the United States or pursuant to an exemption therefrom.

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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.

The TSX Venture Exchange has not reviewed and does not accept any responsibility for the adequacy or accuracy of this press release.


For any additional information, please contact :

M. Andrew J. Sheldon
President and Chief Executive Officer Medicago Inc.
(418) 658-9393

M. Pierre Labbé
Vice-president and Chief Financial Officer Medicago Inc.
(418) 658-9393

Email: info@medicago.com, www.medicago.com;


You are also invited to consult the final prospectus which will be available on the SEDAR Website at www.sedar.com.