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MONTREAL, QUEBEC--(Marketwire - April 1, 2011) -NOT FOR DISSEMINATION TO UNITED STATES NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

MethylGene Inc. (TSX:MYG) announced today that all the conditions associated with its previously announced private placement of approximately $34.5 million have been met and that it is in the process of closing the transaction, having received the majority of the subscription amounts. Shareholders representing more than 50% of the issued and outstanding common shares of MethylGene have approved the transaction as per the rules of the TSX and MethylGene expects to be in receipt of the remaining funds on or about April 4, 2011.

MethylGene will use the net proceeds from the sale of the units to advance MGCD265 into Phase 2 clinical trials in non-small cell lung and other cancer indications. In addition, the Company will also be advancing MGCD290 into Phase 2 clinical trials in vulvovaginal candidiasis (VVC). With the proceeds from this financing, the Company's cash runway is expected to extend into 2014.

Under the terms of the Offering, MethylGene will issue 277,494,756 units at a subscription price per unit of $0.1243 (the "Subscription Price"), each unit consisting of one common share and thirty one-hundredths (0.30) of a common share purchase warrant, exercisable for a period of five years from the date of issuance at an exercise price of $0.1492 (being 120% of the Subscription Price). As such, an aggregate of 277,494,756 common shares and 83,248,422 common share purchase warrants (including the common shares and common share purchase warrants issuable upon the conversion of the Debentures, which convert on closing) will be issued pursuant to the Offering.

MTS Securities, LLC acted as financial advisor to MethylGene for the Offering in the United States.

THE COMMON SHARES AND WARRANTS HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS ABSENT U.S. REGISTRATION OR AN APPLICABLE EXEMPTION FROM U.S. REGISTRATION REQUIREMENTS.

About MethylGene

MethylGene Inc. (TSX:MYG) is a clinical-stage biopharmaceutical company that develops novel therapeutics for cancer and infectious disease. The Company's lead product candidates include: MGCD265, an oral multi-targeted kinase inhibitor that is in Phase 1/2 clinical trials for solid tumor cancers and MGCD290, a fungal Hos2 inhibitor, for use in combination with fluconazole for fungal infections, which has completed Phase 1 clinical studies. The Company's partners include Otsuka Pharmaceutical Co. Ltd., Taiho Pharmaceutical Co. Ltd., and EnVivo Pharmaceuticals, Inc.

Certain statements contained in this news release, other than statements of fact that are independently verifiable at the date hereof, may constitute forward-looking statements. Such statements, based as they are on the current expectations of management of MethylGene, inherently involve numerous risks and uncertainties, known and unknown, many of which are beyond MethylGene's control. These risks and uncertainties could cause future results, performance or achievements to differ significantly from the results, performance or achievements expressed or implied by such forward-looking statements. Such results, performance or achievements include, but are not limited to, the timing and effects of regulatory action; the continuation of collaborations; the results of clinical trials; the timing of enrollment or completion of clinical trials; the success, efficacy or safety of MGCD265, MGCD290 or mocetinostat (MGCD0103); the ability to scale up, formulate and manufacture sufficient GMP, clinical or commercialization quantities of MGCD265, MGCD290 or mocetinostat, and the relative success or the lack of success in developing and gaining regulatory approval and/or market acceptance for any compound or new product including MGCD265, MGCD290 or mocetinostat. Such risks include, but are not limited to, the impact of general economic conditions, economic conditions in the pharmaceutical industry, changes in the regulatory environment in the jurisdictions in which MethylGene does business, stock market volatility, fluctuations in costs, expectations with respect to our intellectual property position and our ability to protect our intellectual property and operate our business without infringing upon the intellectual property rights of others, changes in the competitive landscape including changes in the standard of care for the various indications in which MethylGene is involved, and changes to the competitive environment due to consolidation, as well as other risks, as described in MethylGene's Annual Information Form for the fiscal year ending December 31, 2010, under the heading "Risk Factors" which you are urged to read and all other documents filed by the Company that can be found at [ www.sedar.com ]. Consequently, actual future results may differ materially from the anticipated results expressed in the forward-looking statements. The reader should not place undue reliance on the forward-looking statements included in this presentation. These statements speak only as an update on the date they are made and MethylGene is under no obligation to revise such statements as a result of any event, circumstance or otherwise except in accordance with law.