Prolacta Bioscience Closes on over $5 Million in Private Funding.

MONROVIA, Calif. -- Prolacta Bioscience, a privately held company that provides specialty formulations of human milk for the immunological and nutritional needs of premature and critically ill infants, announced today that it has raised over $5 million in private venture funding for its series B prime financing round from a combination of existing investors, new investors, and several high profile angel investors.

New investors included Arcturus Capital, DFJ Mercury, Philip Capital, Funk Ventures Capital, and the Gideon Hixon Fund. Existing investors include DFJ Frontier, Draper Richards, and Draper Associates.

"Arcturus is excited to be a part of Prolacta at a very crucial time in the company's development," said Stephen Watkins, managing director of Arcturus Capital. "We are committed to assisting the company as they seek to fundamentally change the way that babies are fed in the NICU."

Prolacta specializes in the nutritional needs of underweight, premature, and critically ill babies, focused on the first 30 days of life. Infants born weighing less than five pounds, eight ounces (2,500 grams) are considered low birth weight, and are at increased risk of serious health problems, lasting disabilities, and even death. About one in every 13 babies in the United States is born with low birth weight, and nationwide, approximately 500,000 babies are born prematurely each year, which is equal to nearly 12% of all U.S. births. The rate of preterm birth has increased 27 percent between 1982 and 2002, from 9.4 percent to 11.9 percent.

The series B prime financing underscores the organization's stability and long-term growth potential, as hospitals around the country have increased their use of Prolacta's human milk fortifier, trophic feed formulations, and calorie specific milk formulations for hospitalized premature infants.

Prolacta's products, which are made of human milk, contain crucial antibodies from the mother that can help the baby resist infections and serious diseases, such as necrotizing enterocolitis (NEC), sepsis, bacterial meningitis, and ear infections. Human milk has been shown in clinical research studies to decrease the incidence of these conditions. The antibodies found in human milk, as well as other protective molecules are not present in other forms of milk, such as cow milk.

This round of funding will provide resources for Prolacta to complete several important studies which will demonstrate the benefits of its 100% human milk formulations for neonates, and it will also allow Prolacta to bring in additional world class executives to drive the company's growth.

"Prolacta is pleased to have the support of such sophisticated investors," said Frank H. Foster, executive chairman of Prolacta Bioscience. "It is a strong endorsement of our mission to improve the lives of thousands of infants."

About Prolacta

Prolacta Bioscience (www.prolacta.com) is a life science company dedicated to the application of science relating to human milk - one of nature's most complex and valuable substances. Our mission is to make a meaningful difference in the lives of thousands of the most vulnerable infants through world class research and innovative products. Prolacta offers a suite of specialty formulations of human milk for the nutritional and immunological needs of premature and critically ill infants. The company operates a pharmaceutical grade processing plant and has designed and patented processes unique to the science of human milk. Prolacta is committed to supporting research in the areas of human milk and premature infant nutrition in order to assist health care professionals in providing the best possible care for the most fragile babies.

About Arcturus

Arcturus Capital (www.arcturusvc.com) is a Los Angeles based venture capital firm. The Arcturus team combines 170 years of experience in venture capital investing, professional investment management, executive operating experience, and advanced scientific research. With a collective investment record spanning more than three decades, Arcturus principals have made more than 100 venture investments that have resulted in 22 IPOs and 38 M&A transactions. With a large, diverse group of investment professionals, Arcturus is able to be opportunistic across business stages and regions, though our primary focus is early-stage technology companies in the Southern California area.

About DFJ Mercury

DFJ Mercury (www.dfjmercury.com) is a Texas-based, seed and early stage venture capital fund. We invest in companies that are addressing large market opportunities in information technology, applied materials and life sciences. DFJ Mercury is part of the global intelligence network of Draper Fisher Jurvetson funds. DFJ Mercury seeks to partner with extraordinary entrepreneurs to build globally competitive businesses. Our team has a long track record of launching, growing and investing in early stage companies. We believe that the most important ingredient in any start-up is the entrepreneur. Our philosophy is to help entrepreneurs build their businesses from the very early stage.

About Funk Ventures Capital Partners

Funk Ventures is a multi-faceted and entrepreneurial investment firm with focus on venture capital, business acceleration, and real estate. Supported by an experienced and passionate team, the firm's philosophy is grounded in the belief that businesses can make a significant and positive contribution to people, society and the environment. The firm's venture capital arm makes value-add investments in promising companies in the wellness, medical device and clean tech markets. Funk Ventures also runs a business accelerator, providing resources, expertise and management to growing companies that are still too young to receive venture financing. The firm's real estate unit is active as both an investor and developer, with a focus on international resort destinations and sustainable living communities. For more information, visit www.funkventures.com or call [phone]. Funk Ventures is a registered trademark of Funk Ventures, Inc.

About Philip Capital

Phillip Capital is an integrated financial services group that offers a full range of quality and innovative financial services to individuals, corporate and institutional customers. Our services include private equity/venture capital, corporate finance, broking of bonds and stocks, fund management, futures and commodities, factoring, financial planning and property consultancy. We operate in the financial hubs of 11 countries including Singapore, Hong Kong, China, Thailand, Malaysia, Indonesia, Sri Lanka, Thailand, Australia, United Kingdom and France. We have an extensive branch network with more than 2,500 staff in Asia and Europe and total assets under management in excess of US$3 billion.

About Gideon Hixon Fund

The Gideon Hixon Fund is the venture capital vehicle for the Hixon family. The Gideon Hixon Fund and its predecessor entities (HixVen and Southwest Venture Partnerships) have a long history in venture capital beginning in the 1970s. The group's venture capital investments include Apple Computer (NASDAQ & NYSE: AAPL) and Dell (NASDAQ: DELL) as well as more recent successes including CORSolutions (acquired by Matria), Sensitech (acquired by Carrier), Medior (acquired by AOL), Security Dynamics (acquired by RSA), WebCal (acquired by Yahoo) and Xiotech (acquired by Seagate).

About Draper Richards

Draper Richards L.P. is a venture capital firm investing in early-stage technology companies. We fund entrepreneurs with the energy, vision, experience, and desire to build great companies. Draper Richards is an active investor, dedicated to helping entrepreneurs achieve their maximum potential through contacts, advice, and support. We provide portfolio companies assistance in the areas of strategy, executive team recruiting, and raising capital.

About DFJ Frontier

With offices in Sacramento and Santa Barbara, DFJ Frontier (www.dfjfrontier.com) invests in seed and early stage technology companies in California. We are an affiliate of Draper Fisher Jurvetson, a premier Silicon Valley venture capital fund known for visionary early stage investing. DFJ Frontier backs passionate entrepreneurs and provides business assistance, not just capital. We typically lead the first round of investment, taking a significant stake in the company and an active role on the Board of Directors. We continue to invest in subsequent rounds and help arrange financing from other institutional investors, supporting our companies as they move towards self-sufficiency and liquidity.