SYNTARA LIMITED — Share Issue/Capital Change 2006

Oct 18, 2006

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement, application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX's property and may be made public.

Introduced 1/7/96. Origin: Appendix 5. Amended 1/7/98, 1/9/99, 1/7/2000, 30/9/2001, 11/3/2002, 1/1/2003.

Name of entity

Pharmaxis Ltd

ABN

75 082 811 630

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

$\mathbf{1}$ +Class of +securities issued or to be issued

Pharmaxis Ltd ordinary shares

• $\overline{2}$ Number of +securities issued or to 245,000 be issued (if known) or maximum number which may be issued
• 3 Principal terms of the "securities (eg, if options, exercise price and date; if partly expiry paid *securities, the amount outstanding and due dates for payment; if *convertible securities, the conversion price and dates for conversion)

Issue of fully paid ordinary shares upon exercise of options granted under the Pharmaxis Ltd Employee Option Plan.

+ See chapter 19 for defined terms.

4	Do the "securities rank equally in allrespects from the date of allotmentwith an existing 'class of quoted*securities?	Yes
	If the additional securities do notrank equally, please state:the date from which they dothe extent to which they٠participate for the next dividend,(inthe caseоfіtrust.adistribution) or interest paymentthe extent to which they do notrank equally, other than inrelation to the next dividend,distribution or interest payment
5	Issue price or consideration	60,000 shares: $0.1250160,000 shares: $0.312525,000 shares: $1.7900
6	Purpose of the issue(If issued as consideration for theacquisition of assets, clearly identifythose assets)	Employee Option Plan	Exercise of options under Pharmaxis Ltd
7	Dates of entering *securities intouncertificated holdings or despatchof certificates	20 October 2006
8	and†elassofNumberallquoted on*securities$\mathbf{A}\mathbf{S}\mathbf{X}$(including the securities in clause2 if applicable)	Number177,216,092	+ ClassfullyOrdinarypaidshares

$+$ See chapter 19 for defined terms.

	Number	* Class
9telassNumberandοfаII	1,280,000	Options expiring on
"securities not quoted on ASX		various dates with an
(including the securities in clause		оfexerciseprice
2 if applicable)		$0.125 (ASX Code
		PXSAM)
	5,472,000	Options expiring on
		various dates with an
		οfexerciseprice
		$0.3125 (ASX Code
		PXSAO)
	500,000	Options expiring 30
		November 2013 with
		an exercise price of
		$0.376 (ASX Code
		PXSAQ)
	22,500	Options expiring24
		March 2014 with an
		$_{\mathrm{of}}$exerciseprice
		$0.508 (ASX Code
		PXSAS)
	15,000	Options expiring3
		June 2014 withan
		οfexerciseprice
		$$0.426$ $(ASK$ $Code$
		PXSAU)
	255,000	Options expiring$\mathbf{l}$
		February 2015 with an
		exercisepriceοf
		оf
	330,000847,000105,000	$0.8340 (ASX CodePXSAY)Options expiring11May 2015 withanofexerciseprice$1.147 (ASX CodePXSAW)Optionsexpiring4August 2015 with anexercise price of $1.79(ASX Code PXSAZ)Options expiring 17October 2015 with anexerciseprice$2.772 (ASX CodePXSAA)

$\overline{\text{+}$ See chapter 19 for defined terms.

270,000	Options expiring 12
	February 2016 with an
	exercise price of
	$2.194 (ASX Code
	PXSAB)
96,500	Options expiring 31
	May 2016 with an
	exercise price of
	$2.034 (ASX Code
	PXSAC)
646,500	Options expiring 14
	August 2016 with an
	exercise price of
	$1.917 (ASX Code
	PXSAD)
72,500	Options expiring 19
	September 2016 with
	an exercise price of
	$1.8918 (ASX Code
	PXSAE)

Dividend policy (in the case of a $\sqrt{\frac{n}{a}}$ $\rm 10$ trust, distribution policy) on the increased capital (interests)

Part 2 - Bonus issue or pro rata issue

$\mathsf{H}$	securityholderapprovallsrequired?
12	Is the issue renounceable or non-renounceable?
$\vert 3 \vert$	Ratio in which the "securities willbe offered
$\vert 4$	Class of securities to which theoffer relates
15	determine*RecorddateÍΟentitlements
16	Will holdings on different registers(or subregisters) be aggregated forcalculating entitlements?
17	Policy for deciding entitlements inrelation to fractions

+ See chapter 19 for defined terms.

18.	Names of countries in which theentity has "security holders whowill notbe -sentissuenewdocuments
	Note: Security holders must be told how theirentitlements are to be dealt with.Cross reference: rule 7.7.
19.	ofClosing date forreceiptacceptances or renunciations
20.	Names of any underwriters
21	Amount of any underwriting fee orcommission
22.	Names of any brokers to the issue
23.	Fee or commission payable to thebroker to the issue
24	Amount of any handlingfeepayable to brokers who lodgeacceptances or renunciationsonbehalf of *security holders
25.	the issue isĦcontingenton"security holders"approval,thedate of the meeting
26	Date entitlement and acceptanceform and prospectus or ProductDisclosure Statement will be sent topersons entitled
27	If the entity has issued options, andthe terms entitle option holders toparticipate on exercise, the date onwhich notices will be sent to optionholders
28	Date rights trading will begin (ifapplicable)
29.	Date rights trading will end (ifapplicable)
30	How do "security holders sell their

entitlements in full through a broker?

• 31 How do "security holders sell part of their entitlements through a broker and accept for the balance?
• 32 How do "security holders dispose of their entitlements (except by sale through a broker)?

33 +Despatch date

Part 3 - Ouotation of securities

You need only complete this section if you are applying for quotation of securities

34	Type of securities(iick one)
$(a) \quad \times $	Securities described in Part 1
$(b)$	All other securitiesExample: restricted securities at the end of the escrowed period, partly paid securities that become fully paid,incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or documents

• 35 If the "securities are "equity securities, the names of the 20 largest holders of the additional *securities, and the number and percentage of additional *securities held by those holders
• 36 If the *securities are *equity securities, a distribution schedule of the additional *securities setting out the number of holders in the categories $1 - 1,000$ $1,001 - 5,000$ $5,001 - 10,000$ $10,001 - 100,000$ 100,001 and over

37

A copy of any trust deed for the additional "securities

Entities that have ticked box 34(b)

become fully paid, employee

+ See chapter 19 for defined terms.

38.	Number of securities for which*quotation is sought
39	Class of "securities for whichquotation is sought
40	Do the *securities rank equally in allrespects from the date of allotmentwith an existing "class of quoted*securities?
	If the additional securities do notrank equally, please state:the date from which they do٠whichtheextenttothey٠participate for the next dividend,case of(inthe$\mathbf{a}$trust.distribution) or interest paymentthe extent to which they do not$\bullet$rank equally, other than inrelation to the next dividend,distribution or interest payment
41	Reason for request for quotationnow
	Example: In the case of restricted securities, end ofrestriction period.
	(if issueduponconversionofanother security, clearly identify thatother security)
		Number	* Class
42	Number and *class of all *securitiesquoted on ASX (including thesecurities in clause 38)

$\overline{\text{ }*$ See chapter 19 for defined terms.

Quotation agreement

• $\mathbf{I}$ "Ouotation of our additional 'securities is in ASX's absolute discretion. ASX may quote the "securities on any conditions it decides.
• $\overline{2}$ We warrant the following to ASX.
  • The issue of the *securities to be quoted complies with the law and is not for $\bullet$ an illegal purpose.
  • There is no reason why those "securities should not be granted "quotation.
  • An offer of the "securities for sale within 12 months after their issue will not require disclosure under section $707(3)$ or section $1012C(6)$ of the Corporations Act.

Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any *securities to be quoted and that no-one has any right to return any *securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the *securities be quoted.
• We warrant that if confirmation is required under section 1017F of the Ă Corporations Act in relation to the *securities to be quoted, it has been provided at the time that we request that the *securities be quoted.
• If we are a trust, we warrant that no person has the right to return the $\bullet$ *securities to be quoted under section 1019B of the Corporations Act at the time that we request that the *securities be quoted.

+ See chapter 19 for defined terms.

• $\overline{3}$ We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.
• $\overline{4}$ We give ASX the information and documents required by this form. If any information or document not available now, will give it to ASX before *quotation of the "securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

......David McGarvey............

Sign here:

...................................... (Company secretary)

19th October 2006...

Print name:

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+ See chapter 19 for defined terms.