SYNTARA LIMITED — Capital/Financing Update 2005

Aug 4, 2005

pharmaxis

5 August 2005

Manager of Company Announcements Australian Stock Exchange Exchange Centre Level 3 20 Bridge Street Sydney NSW 2000

Dear Sir/Madam,

Proposed Issue of Securities - Employee Options

In accordance with Listing Rule 3.10.3, Pharmaxis advises that, following a review of employee and director performance for the year ended 30 June 2005, the directors have resolved to grant options under the Pharmaxis Ltd Employee Option Plan as follows:

Options to Employees

Class of	Number	Principal terms	Issue	Purpose of issue	Shareholder	Issue
security	to be		price		approval	to class
	issued				required
Unlisted	619,500	Exercise price of	Nil	To be issued to	No.	$\rm No$
employee		$1.79. Vesting:		all (29) employees
options over		$25%$ of options to		of the company
Pharmaxis		vest at each of 30		under, and in
Ltd ordinary		June, 2006, 2007,		accordance with,
shares		2008 and 2009,		the Pharmaxis
		subject to		Ltd Employee
		approval by		Option Plan
		Remuneration and
		Nomination
		Committee of the
		Board. Options
		expire 4 August
		2015

Options to Executive Directors

Class of	Number	Principal terms	Issue	Purpose of issue	Shareholder	Issue
security	to be		price		approval	to class
	issued				required
Unlisted	255,000	Exercise price of	Nil	To be issued to	Shareholder	$\rm No$
employee		$1.79. Vesting:		two executive	approval will
options over		$25%$ of options to		directors under,	be sought at
Pharmaxis		vest at each of 30		and in	the 2005
Ltd ordinary		June, 2006, 2007,		accordance with,	Annual
shares		2008 and 2009,		the Pharmaxis	Meeting
		subject to		Ltd Employee
		approval by		Option Plan
		Remuneration and
		Nomination
		Committee of the
		Board. Options
		expire 4 August
		2015

Options to Independent Directors

Class of	Number	Principal terms	Issue	Purpose of issue	Shareholder	Issue
security	to be		price		approval	to class
	issued				required
Unlisted	80,000	Exercise price of	Nil	To be issued to	Shareholder	$\rm No$
employee		$1.79. Vesting:		three	approval will
options over		$25%$ of options to		independent	be sought at
Pharmaxis		vest at each of 30		directors under,	the 2005
Ltd ordinary		June, 2006, 2007,		and in	Annual
shares		2008 and 2009.		accordance with,	Meeting
		Options expire 4		the Pharmaxis
		August 2015		Ltd Employee
				Option Plan

The Company will lodge relevant Appendix 3Bs when required by the Listing Rules.

Sincerely,

David McGarvey Company Secretary