(Research Triangle Park, N.C.) Tranzyme Pharma (Nasdaq:TZYM), today announced that it has agreed to sell approximately 2.6 million shares of its common stock at a price of $3.85 per share in a registered direct offering. The offering will raise gross proceeds to Tranzyme of approximately $10.0 million before deducting underwriters’ discounts and other offering expenses. Tranzyme has also granted the underwriters a 30-day option to purchase up to an additional fifteen percent of the shares of common stock offered to cover over-allotments, if any, which would result in additional gross proceeds of approximately $1.5 million if exercised in full.

The securities were offered pursuant to an effective shelf registration statement. The company intends to use the proceeds for working capital and other general corporate purposes. The Company anticipates that the offering will close on September 18, 2012, subject to customary closing conditions, at which time Tranzyme will receive the cash proceeds and deliver the securities.

Cowen and Company, LLC acted as sole bookrunning manager for the offering. JMP Securities LLC acted as a co-manager for the offering.

A shelf registration statement relating to the shares of common stock issued in the offering has been filed with the Securities and Exchange Commission (the “SEC”) and declared effective. A prospectus supplement relating to the offering will be filed by Tranzyme with the SEC. A copy of the prospectus for the offering can be obtained by eligible investors from their Cowen and Company sales representative, or from the offices of Cowen and Company, LLC c/o Broadridge Financial Services., 1155 Long Island Avenue, Edgewood, NY, 11717, Attn: Prospectus Department. Phone (631) 274-2806 / Fax (631) 254-7140.

This press release does not constitute an offer to sell or the solicitation of offers to buy any securities of Tranzyme, and shall not constitute an offer, solicitation or sale of any security in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About Tranzyme Pharma

Tranzyme Pharma is a clinical-stage biopharmaceutical company focused on discovering, developing and commercializing novel, mechanism-based therapeutics for the treatment of upper gastrointestinal (GI) motility disorders. While approximately 40 percent of people in the U.S. are affected by these persistent and recurring conditions which disrupt the normal movement of food throughout the GI tract, there are a limited number of safe and effective treatment options. Tranzyme is developing TZP-102, an oral ghrelin agonist for treating the symptoms associated with chronic upper GI motility disorders. Enrollment is complete in a multinational Phase 2b trial evaluating TZP-102 given once daily in diabetic patients with gastroparesis; top-line data are expected by year-end 2012. Tranzyme has initiated a second Phase 2b trial (DIGEST) evaluating TZP-102 given prior to meals in diabetic patients with gastroparesis; top-line data are expected in the first half of 2013. By leveraging its proprietary drug discovery technology, MATCH™, Tranzyme is committed to pursuing first-in-class medicines to address areas of significant unmet medical needs.