As part of the agreement, a new, commercially-focused senior management team will be appointed. Proceeds from the transaction will allow MiddleBrook to move forward with the commercial launch of its once-daily MOXATAG product, and to continue the development of its clinical pipeline.

As part of the agreement with EGI, Edward M. Rudnic, Ph.D. will step down from his current position as MiddleBrook's President and CEO and will be replaced by John Thievon, effective upon the closing of the transaction. In addition, David Becker has been appointed as MiddleBrook Executive Vice President, Finance and CFO, replacing Robert C. Low as MiddleBrook's principal financial officer, also effective upon the transaction closing. Dr. Rudnic and Mr. Low will continue to serve as consultants to the Company following the closing.

Mr. Thievon brings more than 17 years of pharmaceutical sales and marketing experience to MiddleBrook, and will be responsible for the successful launch and commercialization of MOXATAG Tablets and the continued development of the Company's other PULSYS pipeline products. Most recently, Mr. Thievon was Executive Vice President, Sales and Corporate Accounts for Adams Respiratory Therapeutics (Adams). While with Adams, Mr. Thievon launched the Mucinex brand and built the Mucinex franchise into more than $350 million in annual revenue. Mr. Thievon left Adams in February 2008, following its acquisition by Reckitt Benckiser.

Mr. Becker was also a former senior executive at Adams, where he was Chief Financial Officer from 2000-2007. He completed Adams' initial public offering in 2005, and was appointed Chief Financial and Administrative Officer in 2007. Mr. Becker has 18 years of public accounting, mergers and acquisitions, and corporate finance experience, and will be responsible for all of MiddleBrook's finance and operating activities.

Several changes to the Board of Directors will result from the agreement with EGI. Dr. Rudnic will depart from the MiddleBrook board, effective upon the transaction closing. At closing, William C. Pate, Managing Director at EGI; Mark Sotir, Managing Director at EGI; and John Thievon will join the current Board, which will be expanded to nine members.

"We are very pleased to have completed this agreement with Equity Group, and believe it provides MiddleBrook with both the financial resources and the operational management expertise to make our FDA-approved MOXATAG product a commercial success," stated R. Gordon Douglas, M.D., MiddleBrook Chairman of the Board. "With our strategic review now concluded, we look forward to focusing the Company's initiatives on successfully executing its operating plan."

"Additionally, with the forthcoming departure of Ed Rudnic, I would like to join the Company's employees and all its shareholders in expressing my profound gratitude for his contribution in creating MiddleBrook, its intellectual property, and in leading the team to the successful approval of MOXATAG," Dr. Douglas continued. "Ed's leadership, vision, and proven entrepreneurial achievements will continue to serve MiddleBrook well following his departure, and we wish him the best in his future endeavors. The current Board of Directors looks forward to working closely with MiddleBrook's new executive management team in driving MOXATAG to the market. We are all very focused and eager to present MOXATAG to the market and to communicate its unique benefits of improved convenience and likely enhanced patient compliance to the healthcare community."

Investment Terms

MiddleBrook announced today that it entered into a definitive securities purchase agreement with EGI for the sale of 30,303,030 shares of its common stock at $3.30 per share and a five-year warrant to purchase a total of 12,121,212 shares of common stock at an exercise price of $3.90 per share. EGI's investment totals approximately $100 million.

In connection with the transaction, MiddleBrook has agreed to repurchase its Keflex assets previously sold to funds affiliated with Deerfield Management in November of 2007, contemporaneously with the closing of the transaction. The Company will reacquire the Keflex assets as well as its ongoing royalty obligations to Deerfield for approximately $11 million. Additionally, as a result of the EGI transaction, MiddleBrook will redeem the 3.0 million warrants issued to Deerfield in conjunction with the Keflex asset sale for a total of $8.8 million.

The transaction is subject to approval by MiddleBrook's common stockholders, and other customary closing conditions, and is expected to close in 60 to 90 days. Three of MiddleBrook's largest stockholders, HealthCare Ventures, Rho Ventures and Deerfield, have entered into voting agreements with EGI and the Company, agreeing to vote their shares of MiddleBrook common stock in favor of the EGI transaction. These MiddleBrook shareholders collectively represent approximately 37 percent of the Company's currently outstanding shares of common stock.

In addition to satisfying the Deerfield obligations described above, the Company intends to use the proceeds from the financing to support the creation of a sales and marketing infrastructure supporting the commercial launch of MOXATAG, for restarting the clinical development of its once-daily PULSYS version of Keflex, as well as the pediatric version of its Amoxicillin PULSYS product that were previously on-hold, and for working capital and general corporate purposes. -- MiddleBrook Pharmaceuticals, Inc.