Merger Would Allow Jaguar to  Recognize an Important Revenue Stream from First-in-Class, Novel Mechanism of Action of the Anti-diarrheal Mytesi

San Francisco, CA (October 6, 2016) – Jaguar Animal Health, Inc. (NASDAQ: JAGX) (“Jaguar”), an animal health company focused on developing and commercializing first-in-class gastrointestinal products for companion and production animals, foals, and high value horses, announced today that it has signed a non-binding letter of intent (“LOI”) with Napo Pharmaceuticals, Inc. (“Napo”) potentially to merge the two companies. Napo focuses on human product development and commercialization from plants used traditionally in rainforest areas, and has provided Jaguar with exclusive worldwide rights for veterinary applications to crofelemer and corresponding rights to all related Napo technology.

The LOI contemplates a 3-to-1 Napo-to-Jaguar value ratio (inclusive only of in-the-money convertible securities of Jaguar at the time a definitive agreement is entered into) to calculate the relative ownership of the merged entity. As of October 1, 2016, Napo owned 22.6% of Jaguar’s outstanding shares of common stock. The LOI also outlines capitalization requirements that Napo would be required to satisfy to proceed with a potential merger.

A merger of the two companies, should it occur, would allow Jaguar to recognize revenue from sales of crofelemer, under the brand name Mytesi^TM (formerly known as Fulyzaq¨), an important Napo revenue stream. Crofelemer was approved by the Food and Drug Administration (“FDA”) in 2012 for the symptomatic relief of noninfectious diarrhea in adults with HIV/AIDS on antiretroviral therapy.In May 2016, Napo regained ownership of the New Drug Application (NDA) and commercial rights for human applications of crofelemer (Mytesi^TM) from Valeant Pharmaceuticals International, which acquired those rights from Salix Pharmaceuticals in April 2015. Napo is now recognizing the sales of Mytesi^TM, and will begin promotion of Mytesi^TM to HIV prescribers in October 2016