Synergy Pharmaceuticals Announces Closing of Convertible Notes Exchanges

NEW YORK–(BUSINESS WIRE)– Synergy Pharmaceuticals Inc. (NASDAQ:SGYP) today announced that it has
closed separate, privately-negotiated exchanges (collectively, the
“Exchanges”) with Eligible Holders (as defined below) of its outstanding
7.50% Convertible Senior Notes due 2019 (CUSIP No. 871639 AC41) (the
“Notes”) for the consideration set forth below.

At the closing, and in satisfaction of the consideration for $79.8
million in aggregate principal amount of the Notes, representing
approximately 50% of the outstanding aggregate principal amount of
Notes, Synergy issued 35.3 million shares of its common stock (the
“Shares”). Synergy also issued approximately 872,000 Shares in payment
of accrued and unpaid interest on Notes accepted in the Exchanges from
the applicable last interest payment date to, but not including, March
28, 2016. A total of 25.6 million shares carried a conversion price of
$3.11 pursuant to the existing terms of the Notes. The overall average
price per share on the total shares issued was $3.02.

Any Notes not exchanged for Shares pursuant to the Exchanges remain
outstanding.

The Shares have not been registered under the Securities Act of 1933, as
amended (the “Securities Act”), or with any securities regulatory
authority of any State or other jurisdiction, and may not be offered or
sold in the United States or to U.S. persons absent registration or an
applicable exemption from the registration requirements. The Exchanges
were made only with, and the Shares were offered and issued only to,
holders of Notes who are “qualified institutional buyers” as defined in
Rule 144A under the Securities Act (“Eligible Holders”), in private
transactions in reliance upon the exemption from the registration
requirements of the Securities Act provided by Section 4(a)(2) thereof.

This news release shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of the
Shares, in any jurisdiction in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the
securities laws of any such jurisdiction.

About Synergy Pharmaceuticals Inc.

Synergy is a biopharmaceutical company focused on the development and
commercialization of novel gastrointestinal (GI) therapies. Our
proprietary GI platform is based on uroguanylin, a naturally occurring
human GI peptide, and includes two lead product candidates – plecanatide
and dolcanatide. Plecanatide is our first uroguanylin analog currently
being evaluated for use as a once-daily tablet for two functional GI
disorders, chronic idiopathic constipation and irritable bowel syndrome
with constipation. Dolcanatide is our second uroguanylin analog
currently being explored for inflammatory bowel disease. For more
information, please visit www.synergypharma.com.

Forward-Looking Statements

Certain statements in this press release are forward-looking within the
meaning of the Private Securities Litigation Reform Act of 1995. These
statements may be identified by the use of forward- looking words such
as « anticipate, » « planned, » « believe, » « forecast, » « estimated, »
« expected, » and « intend, » among others. These forward-looking statements
are based on Synergy’s current expectations and actual results could
differ materially. There are a number of factors that could cause actual
events to differ materially from those indicated by such forward-looking
statements. These factors include, but are not limited to, substantial
competition; our ability to continue as a going concern; our need for
additional financing; uncertainties of patent protection and litigation;
uncertainties of government or third party payer reimbursement; limited
sales and marketing efforts and dependence upon third parties; and risks
related to failure to obtain FDA clearances or approvals and
noncompliance with FDA regulations. As with any pharmaceutical under
development, there are significant risks in the development, regulatory
approval and commercialization of new products. There are no guarantees
that future clinical trials discussed in this press release will be
completed or successful or that any product will receive regulatory
approval for any indication or prove to be commercially successful.
Investors should read the risk factors set forth in Synergy’s Form 10-K
for the year ended December 31, 2015 and other periodic reports filed
with the Securities and Exchange Commission. While the list of factors
presented here is considered representative, no such list should be
considered to be a complete statement of all potential risks and
uncertainties. Unlisted factors may present significant additional
obstacles to the realization of forward-looking statements.
Forward-looking statements included herein are made as of the date
hereof, and Synergy does not undertake any obligation to update publicly
such statements to reflect subsequent events or circumstances.

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