GALMED PHARMACEUTICALS LTD. 8 Shaul Hamelech Blvd., Tel Aviv 6473307, Israel

GALMED PHARMACEUTICALS LTD.

8 Shaul Hamelech Blvd., Tel Aviv 6473307,

invited to attend a Special General Meeting of Shareholders of Galmed Pharmaceuticals Ltd. to be held at 4:00 p.m., Israel time,

on Thursday, June 12, 2014, at the Company's offices at 8 Shaul Hamelech Blvd., Amot Hamishpat Bldg., Tel Aviv, Israel.

You will be asked at

this meeting to take action on the matter set forth in the attached Notice of Special General Meeting of Shareholders. The Board

of Directors is recommending that you vote "FOR" the election of all nominees for external directors to the Company's

Board of Directors and the approval of their terms of office.

At the meeting, a discussion

period will be provided for questions and comments of general interest to shareholders.

greeting personally those shareholders who are able to be present at the meeting. If you do plan to attend, we ask that you bring

with you some form of personal identification and verification of your status as a shareholder as of the close of trading on May

12, 2014, the record date for the meeting. However, whether or not you will be with us at the meeting, it is important that your

shares be represented. Accordingly, you are requested to complete, date, sign and mail the enclosed proxy in the envelope provided

at your earliest convenience and in any event so as to be received in a timely manner as discussed in the enclosed Proxy Statement.

Chief Executive Officer

Pharmaceuticals Ltd.

of A Special General Meeting of Shareholders

be Held on June 12, 2014

Notice is hereby given that a Special General

Meeting of the Shareholders (the "Special Meeting" or the "Meeting") of Galmed Pharmaceuticals

Ltd. (the "Company"), an Israeli company, will be held at the Company's offices at 8 Shaul Hamelech Blvd.,

Tel Aviv, Israel, on Thursday, June 12, 2014 at 4:00 p.m.(Israel time).

The agenda for the Special Meeting is to

elect Ms. Tali Yaron-Eldar and Dr. David Sidransky as external directors of the Company in accordance with the provisions of the

Israel Companies Law, 5759-1999, each for a period of three years commencing as of the date of the Meeting, and to approve

their terms of office as set forth in the proxy statement.

Shareholders of record

at the close of trading on the Nasdaq Capital Market on May 12, 2014 (the "Record Date") are entitled to vote

at the Meeting. All shareholders are cordially invited to attend the Meeting in person. Two or more shareholders, present in person,

by proxy or by proxy card, and holding shares conferring in the aggregate more than thirty-three and a third percent (33.33%) of

the voting power of the Company on the Record Date, shall constitute a quorum at the Meeting. Should no quorum be present within

half an hour from the time set for the Meeting, the Meeting shall be adjourned to Tuesday June 17, 2014, at the same time and place.

No further notice will be given or publicized with respect to such adjourned meeting. If at such adjourned meeting a quorum is

not present within half an hour from the time stated for such meeting, any two shareholders present in person, by proxy or by proxy

card, shall constitute a quorum, even if, between them, they represent shares conferring 33.33% or less of the voting rights of

the Company on the Record Date.

do not expect to attend the Meeting in person are requested to complete, date and sign the enclosed form of proxy card and return

it as promptly as possible in the enclosed stamped envelope. No postage is required if mailed in the United States.

shares should take note that, pursuant to Article 64 of the Company's Amended and Restated Articles of Association, the vote

of the senior holder who tenders a vote, in person, by proxy or by proxy card, will be accepted to the exclusion of the vote(s)

of the other joint holder(s), and for this purpose seniority will be determined by the order in which the names appear in the Company's

shareholder register.

GALMED PHARMACEUTICALS LTD.

8 Shaul Hamelech Blvd., Tel Aviv 6473307,

General Meeting of Shareholders

The enclosed proxy is

being solicited by the board of directors (the "Board") of Galmed Pharmaceuticals Ltd. (the "Company"

or "Galmed") for use at a Special General Meeting of Shareholders (the "Meeting") to be held

at the Company's offices at 8 Shaul Hamelech Blvd., Tel Aviv, Israel, on Thursday, June 12, 2014 at 4:00 p.m. (Israel time),

or at any postponement or adjournment thereof.

Record Date; Entitlement to Vote

determining shareholders entitled to notice of, and to vote at, the Meeting has been established as of the close of trading on

the Nasdaq Capital Market on May 12, 2014 (the "Record Date").

As of May 1, 2014 the

Company had outstanding 11,100,454 ordinary shares, par value of 0.01 New Israeli Shekels ("NIS") per share

(the "Ordinary Shares"), each of which is entitled to one vote upon the matter to be presented at the Meeting.

Two or more shareholders,

present in person, by proxy or by proxy card, and holding shares conferring in the aggregate more than thirty-three and a third

percent (33.33%) of the voting power of the Company on the Record Date, shall constitute a quorum at the Meeting. Should no quorum

be present within half an hour from the time set for the Meeting, the Meeting shall be adjourned to June 17, 2014, at the same

time and place. No further notice will be given or publicized with respect to such adjourned meeting. If at such adjourned meeting

a quorum is not present within half an hour from the time stated for such meeting, any two shareholders present in person, by proxy

or by proxy card, shall constitute a quorum, even if, between them, they represent shares conferring 33.33% or less of the voting

rights of the Company on the Record Date.

Required Vote and Voting Procedures

The proposal set forth

in the accompanying Notice of Special General Meeting of Shareholders (the "Notice") to be presented at the

Meeting, requires the affirmative vote of the holders of a simple majority of the Ordinary Shares represented at the Meeting in

person, by proxy or by proxy card, and voting thereon, provided that: (i) the majority includes at least a majority of the shareholders

who are not controlling shareholders and who do not have a personal interest in the matter as a result of an affiliation with a

controlling shareholder, who are present and voting (abstentions are disregarded); and (ii) the non-controlling shareholders or

shareholders who do not have a personal interest in the matter as a result of an affiliation with a controlling shareholder who

are present and voting against the election hold 2% or less of the voting power of the Company (such majority, determined in accordance

with clause (i) or (ii), shall be referred to hereinafter as a "Special Majority").

Pursuant to the Israel Companies

Law, 5759-1999, as amended (the "Companies Law"), in order for your vote to be counted with respect to the matters on

the agenda, you must indicate on your proxy or proxy card, or inform the Company at the Meeting and prior to voting thereon, (i)

whether you are a controlling shareholder of the Company or (ii) if you or any of the following persons have a personal interest

in the approval of the relevant matter on the agenda:

proxy card you will be requested to indicate whether you are a "controlling shareholder" of the Company or whether you

have, or any of the persons or entities described above has, a "personal interest", with respect to the matter on the

affirmatively indicated on the attached proxy card that you are a "controlling shareholder" of the Company or that you

have, or that any of the persons or entities described above has, a "personal interest", your signature on the attached

proxy card will certify that you are not a "controlling shareholder" of the Company and that none of the persons or entities

described above, including you, has a "personal interest" in the matter on the agenda.

To be counted, a duly

executed proxy or proxy card must be received by the Company prior to the Meeting. An instrument appointing a proxy shall be in

writing in a form approved by the Board and shall be delivered to the Company at its registered offices at 8 Shaul Hamelech Blvd.,

Tel Aviv 6473307, Israel, Attention: Director of Operations, or at the offices of the Company's transfer agent, VStock Transfer

LLC, at 77 Spruce St., Suite 201, Cedarhurst, New York 11516, not less than 72 hours before the time scheduled for the Meeting

or adjourned meeting or presented to the Chairman of the Meeting at the Meeting. A proxy card shall be delivered to the Company

at its registered offices at 8 Shaul Hamelech Blvd., Tel Aviv 6473307, Israel, Attention: Director of Operations, or at the offices

of the Company's transfer agent at 77 Spruce St., Suite 201, Cedarhurst, New York 11516, by no later than 11:59 p.m., New

York time, on the last business day immediately preceding the date of the Meeting or adjourned meeting or presented to the Chairman

of the Meeting at the Meeting. Shares represented by proxies and proxy cards received after the times specified above will not

be counted as present at the Meeting and thus will not be voted.

Shareholders may revoke

the authority granted by their execution of a proxy or a proxy card at any time before the effective exercise thereof by voting