Orbus Pharma Inc. Signs Binding Term Sheet with Nanjing Sanhome Pharmaceutical Co., Ltd.

Orbus Pharma Inc. (ORB - TSX), ("Orbus") today announced pursuant to its November 18, 2009 press release, the signing of a binding Term Sheet ("Term Sheet") with Nanjing Sanhome Pharmaceutical Co., Ltd ("Sanhome"), a Chinese based health care company.  The Term Sheet stipulates that Orbus will issue common shares through a private placement in the range of 375,000,000 to 500,000,000 common shares at no more than $0.016 per share.  Aggregate proceeds from the private placement will be $6,000,000 to $8,000,000.  Sanhome will purchase approximately 223,000,000 to 287,000,000 of the common shares to be issued pursuant to the private placement and other eligible investors will purchase the balance of the common shares to be issued pursuant to the private placement.  Upon completion of the private placement, Sanhome will hold at least 51% of all issued and outstanding shares of Orbus.  The Board of Directors of Orbus supports the private placement and has agreed to work towards closing the transaction by February 15, 2010.

Under the Term Sheet, Sanhome will invest in Orbus as a "turn key" operation with its commercially sold and partially developed prescription pharmaceutical products along with two Good Manufacturing Practice ("GMP") certified manufacturing facilities in  Markham and Cambridge, Ontario, respectively.  The completion of the private placement under the Term Sheet requires the amendment of existing arrangements with Orbus' senior lender who is owed $3.1 million, the holders of convertible debentures who are owed $8.2 million, the holder of a subordinated credit facility who is owed $252,814, and also requires the holders of existing warrants, options and other rights to acquire an aggregate of 15,189,000 Common Shares to cancel such warrants, options and other rights for no additional consideration (the "Third Party Amendments").  The Term Sheet also contemplates the appointment of a new Board of Directors on completion.

The net proceeds of this private placement will be used to fund post closing development plans, pay liabilities and cover general working capital requirements.  

The transaction is subject to a number of conditions precedent, including completion of satisfactory due diligence, execution of definitive agreements with Sanhome, the negotiation and execution of the Third Party Amendments, required consents and receipt of all regulatory approvals.  There can be no assurance as to the completion of all negotiations and finalizing definitive agreements in a form satisfactory to Orbus, including in particular the subscription agreement for the private placement with Sanhome and the Third Party Amendments.

Sanhome is a growing health care company founded in 1996 and is headquartered in Nanjing, China.  Its website is www.sanhome.com.  As a comprehensive pharmaceutical enterprise it has an extensive new drug research and development centre, state of the art manufacturing facilities and a broad portfolio of prescription pharmaceuticals along with traditional Chinese medicine that are marketed throughout China.  Sanhome received the national GMP certification for its Niushou manufacturing facility in April 1999 and for its Nanjing manufacturing facility in January 2002.  The two plants cover an area of 80,000 square meters and have the capacity to produce multiple dosage forms.  The company and its management have been endowed with many enterprise honours.

Orbus Pharma Inc., headquartered in Markham, Ontario, is pursuing an integrated global strategy of: (1) generic drug development, using proprietary delivery systems for certain products; (2) product out-licensing; and (3) pharmaceutical manufacturing. For more information, please visit www.orbus.ca.

Forward-looking statements

Certain statements in this disclosure are "forward-looking statements", which reflect management's expectations regarding the Company's future growth, results of operations, performance and business prospects and opportunities. Such forward-looking statements reflect management's current beliefs and are based on information currently available to management. Many factors could cause results to differ materially from the results discussed in the forward-looking statements, including risks related to dependence on key suppliers, economic conditions, competition, regulatory change, foreign exchange rates, and interest rates, among others. Although the forward-looking statements are based on what management believes to be reasonable assumptions, the Company cannot assure investors that actual results will be consistent with these forward-looking statements.

Please contact the following Orbus officers for further information:

Mr. Greg W. Muir            

Interim President and Chief Executive Officer                                                                          

(905) 943 9444 ext. 222

gmuir@orbus.ca

Source:  Orbus Pharma Inc. (TSX: ORB) http://www.orbus.ca

Maximum News Dissemination by Filing Services Canada Inc. *

www.usetdas.com

http://www.useTDAS.com

Related terms: acquisition, business, canada, ceo, china, debentures, foreign exchange, health, interest rates, manufacturing, medicine, ontario, pharmaceuticals, president, Private Placement, products, rates, research and development, state of the art