EANS-Adhoc: Oxygen Biotherapeutics Signs Agreement to Sell DERMACYTE Products

to Swiss Sales and Distribution Company

ad-hoc disclosure transmitted by euro adhoc with the aim of a Europe-wide distribution. The issuer is solely responsible for the content of this announcement.

13.01.2011

DURHAM, NC, January 13, 2011 - Oxygen Biotherapeutics, Inc. (NASDAQ & SIX Swiss Exchange: OXBT) today announced it has entered into an agreement with the newly formed, independently owned and operated DERMACYTE Switzerland Ltd. (DSL) of Zurich for the sale of DERMACYTE products. Per the terms of the agreement, DSL has exclusive rights to buy, sell and distribute Oxygen Biotherapeutics´ DERMACTYE® skin care products throughout the European Union, Switzerland and Russia. The agreement also grants DSL the option to add South America as an exclusive territory if purchase volume milestones are achieved.

Per the terms, DSL commits to purchase a total of 40,000 units of DERMACYTE products by calendar year-end 2011. One-thousand units of DERMACYTE products were purchased prior to signing this agreement. After December 31, 2011, the agreement calls for an annual growth rate of 10 percent in units purchased during the preceding calendar year.

Oxygen Biotherapeutics does not have an ownership stake in DSL. It has granted rights to DSL to use the DERMACYTE product trademark.

"Expansion into Europe is a key component of our overall sales strategy for DERMACYTE skin care products and we believe that DSL will allow us to reach this key customer base," said Chris Stern, Chairman and Chief Executive Officer of Oxygen Biotherapeutics.

"The market opportunity for oxygen-based skin care treatments in Switzerland, Russia and the EU is strong, yet in our opinion, existing products introduced by other companies have not lived up to their promise. Oxygen Biotherapeutics has developed two remarkable skin care lotions that get rave reviews from numerous beauty industry influencers who have used the products in the United States," said Oskar Kaelin, founder of DSL. "We believe our new markets will respond favorably to DERMACYTE as well."

Caution Regarding Forward-Looking Statements
This news release contains certain forward-looking statements by the company that involve risks and uncertainties and reflect the company's judgment as of the date of this release. These statements include the Company´s ability to finalize its agreement with OKAL for the sales and distrubtion of DERMACTYE products, expansion of research and development of the Company´s Oxycyte® product lines, including Wundecyte, and the timing of the introduction of those new products. The forward-looking statements are subject to a number of risks and uncertainties including matters beyond the company´s control that could lead to delays in new product introductions and customer acceptance of these new products, and other risks and uncertainties as described in our filings with the Securities and Exchange Commission, including in the current report on Form 10-Q filed on September 9, 2010. The company disclaims any intent or obligation to update these forward-looking statements beyond the date of this release. This caution is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

end of ad-hoc-announcement ================================================================================ About DERMACTYE Cosmetics

DERMACYTE Oxygen Concentrate is a scientifically designed, proprietary cream made to enhance oxygen delivery to skin. It is the first product in a broad and diverse cosmetic line currently under development by Oxygen Biotherapeutics. It complements DERMACYTE Oxygenating Eye Complex, which has several ingredients, such as avocado essence, soothing oat kernel, Vitamin C, sunflower oil and antioxidants that target the eye contour area. The DERMACYTE skin care line uses the Oxygen Biotherapeutics’ oxycyte technology (an oxygen carrier) to deliver oxygen to tissues, such as skin.

About Oxygen Biotherapeutics, Inc.

Headquartered in Durham, NC, Oxygen Biotherapeutics, Inc. is developing medical and cosmetic products that efficiently deliver oxygen to tissues in the body. The company has developed a proprietary perfluorocarbon (PFC) therapeutic oxygen carrier and liquid ventilation product called Oxycyte that is being formulated for both intravenous and topical delivery. This year, the company launched its DERMACYTE® line of oxygen-rich skin care products. In addition, the company is focused on perfluorocarbon-based oxygen carriers for use in traumatic brain injury, decompression sickness, personal care, and topical wound healing. More information is available at www.oxybiomed.com or www.buydermacyte.com.

end of announcement euro adhoc
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issuer: Oxygen Biotherapeutics Inc. 2530 Meridian Pkwy US-27713 Durham, NC phone: +1(919)7607606 FAX: +1(419)7108764 mail: c.stern@oxybiomed.com WWW: www.oxybiomed.com sector: Biotechnology ISIN: US69207P2092 indexes: SSIRT

stockmarkets: Nasdaq: New York, Main Standard: SIX Swiss Exchange language: English

Rückfragen & Kontakt:

Ellen Corliss

Vice President, Corporate Communications
& Investor Relations
Oxygen Biotherapeutics, Inc
2530 Meridian Pkwy, 3rd floor
Durham, NC 27713
Direct Telephone: +1 919 806 4405
Direct Fax: +1 919 806 4417
Email: e.corliss@oxybiomed.com
Homepage: www.oxybiomed.com

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