January 23, 2008
QuantRx Biomedical Corporation
100 S. Main Street, Suite 300
Doylestown, PA 18901

RE: Letter Loan Agreement

Ladies and Gentlemen:

1.     Loan. This letter when fully executed will constitute a loan agreement
(this “Agreement”) between Platinum Long Term Growth VII LLC (the “Lender”) and
QuantRx Biomedical Corporation, a Nevada corporation (the “Borrower”), pursuant
to which the Lender, on the terms and conditions provided herein, shall agree to
make one or more loans to or for the benefit of the Borrower hereunder in an
amount not to exceed $1,407,246.58 (the “Loan”). The day on which the Lender
makes the Loan is referred to herein as the “Closing Date.” The Lender’s
obligation to make the Loan is subject to the Borrower’s fulfillment of each of
the applicable conditions set forth in Section 3 hereof.
 
2.     Loan Documents.
 
a. Notes. The Loan shall be evidenced by a senior secured convertible promissory
note issued to the Lender in the principal amount of the Loan, dated the date
the Borrower receives the funds from the Lender, in the form attached hereto as
Exhibit A (together with any replacements and substitutes therefore, the
“Note”). The principal amount of the Loan and interest thereon, calculated at
the rate of 10% per annum, as provided in the Note, shall be payable as set
forth more particularly therein. A portion of the Loan shall be made by the
Lender’s cancellation and surrender to the Borrower of the Senior Secured
Convertible Promissory Note, dated October 15, 2007, of the Borrower issued to
the Lender upon exercise of the exchange rights of the Lender set forth in
Section 7 of such surrender note. On or before February 13, 2008, the Lender
may, in its discretion, elect to make an additional loan (the “Platinum
Follow-On Investment”) in the amount of $500,000, which additional loan shall be
on substantially the same terms as the Loan hereunder (including with respect to
Section 2(b) below) and evidenced by a senior secured convertible promissory
note in substantially the form of the Note (and be deemed an “Other Note”
hereunder and under the Note).
 
b. Warrants. In consideration for the Loan, for each $100,000 of new principal
loaned to the Borrower by the Lender (including the Platinum Follow-On
Investment, if made), the Borrower shall issue to the Lender a warrant (the
“Warrant”), in the form attached hereto as Exhibit B, for the issuance of 25,000
shares of common stock of the Borrower at an exercise price of $1.25 per share
and a five-year term.
 
c. Accredited Investor. The Lender hereby represents and warrants that it is an
“accredited investor” as defined in Rule 501 of Regulation D promulgated under
the Securities Act of 1933, as amended
 
d. This Agreement, the Note and any other instruments or documents required or
contemplated hereunder or thereunder (including, without limitation, the Pledge
Agreement and the IP Security Agreement (each as defined below)), whether now
existing or at any time hereafter arising, are herein referred to as the “Loan
Documents.”
 

--------------------------------------------------------------------------------

 
3.     Conditions Precedent.
 
a. Documents to be Delivered. The obligation of the Lender to make the Loan is
subject to the due execution and delivery by the Borrower (or the Borrower
causing the due execution and delivery) to the Lender of each of the following
(all documents to be in form and substance satisfactory to the Lender): 
 
i. This Agreement, the Note and each other instrument, agreement and document to
be executed and/or delivered pursuant to this Agreement and/or the instruments,
agreements and documents referred to in this Agreement.
 
ii. A certified copy of the resolutions of the Board of Directors (or if the
Board of Directors takes action by unanimous written consent, a copy of such
unanimous written consent containing all of the signatures of the members of the
Board of Directors) of the Borrower, dated as of the Closing Date, authorizing
the execution, delivery and performance of the Loan Documents.
 
iii. A certificate, dated as of the Closing Date, signed by an executive officer
of the Borrower to the effect that the representations and warranties set forth
in Section 4 of this Agreement are true and correct as of the Closing Date.
 
b. Absence of Certain Events. The occurrence of a Material Adverse Effect (as
defined below) shall not have occurred or be occurring as of the Closing Date.
 
4.     Representations and Warranties of the Borrower. To induce the Lender to
make the Loan, the Borrower hereby represents and warrants to the Lender that at
and as of the date hereof:
 
a. The Borrower has been duly incorporated and is validly existing and in good
standing under the laws of the state of Nevada, with full corporate power and
authority to own, lease and operate its properties and to conduct its business
as currently conducted. The Borrower is duly qualified as a foreign entity to do
business and is in good standing in every jurisdiction in which its ownership of
property or the nature of the business conducted by it makes such qualification
necessary and where the failure so to qualify would have a Material Adverse
Effect. “Material Adverse Effect” means any material adverse effect on the
ability of the Borrower to perform its obligations hereunder or under the Loan
Documents or on the business, operations, properties or financial condition of
the Borrower.
 
b. Each of the Loan Documents has been duly authorized, validly executed and
delivered on behalf of the Borrower and is a valid and binding obligation of the
Borrower enforceable against the Borrower in accordance with its terms, subject
to limitations on enforcement by general principles of equity and by bankruptcy
or other laws affecting the enforcement of creditors’ rights generally, and the
Borrower has full power and authority to execute and deliver this Agreement and
the Loan Documents and to perform its obligations hereunder and thereunder.
 
c. The execution, delivery and performance of this Agreement and the Loan
Documents will not (i) conflict with or result in a breach of or a default under
any of the terms or provisions of (A) the Borrower’s articles of incorporation
or by-laws, or (B) any material provision of any indenture, mortgage, deed of
trust or other material agreement or instrument to which the Borrower is a party
or by which it or any of its material properties or assets is bound, (ii) result
in a violation of any material provision of any law, statute, rule, regulation,
or any existing applicable decree, judgment or order by any court, Federal or
state regulatory body, administrative agency, or other governmental body having
jurisdiction over the Borrower, or any of its material properties or assets or
(iii) result in the creation or imposition of any material lien, charge or
encumbrance upon any material property or assets of the Borrower or any of its
subsidiaries pursuant to the terms of any agreement or instrument to which any
of them is a party or by which any of them may be bound or to which any of their
property or any of them is subject, except, in the cases of (i), (ii) and (iii)
above, as would not have a Material Adverse Effect.
 
2

--------------------------------------------------------------------------------

 
d. No consent, approval or authorization of or designation, declaration or
filing with any governmental authority on the part of the Borrower is required
in connection with the valid execution and delivery of this Agreement or the
Loan Documents.
 
5.     Miscellaneous. 
 
a. The Borrower has executed and delivered to the Lender a Stock Pledge
Agreement (the “Pledge Agreement”), substantially in the form attached hereto as
Exhibit C, and the Patent, Trademark and Copyright Security Agreement (the “IP
Security Agreement” and, together with the Pledge Agreement, the “Security
Documents”), substantially in the form attached hereto as Exhibit D, together
with all certificates and documentation required under each such document
(including, without limitation, stock certificates and stock powers referenced
therein). The Borrower hereby authorizes the Lender to file any UCC financing
statements evidencing the security interests granted in the Security Documents.
 
b. In the event that Other Notes (as defined in the Note) are issued, the
security interest granted pursuant to the Security Documents shall be deemed to
be granted pro rata for the benefit of the Lender and each purchaser of such
Other Notes (collectively, and together with the Lender, the “Purchasers”) pro
rata, based on the aggregate principal amount of the Notes, PIK Notes (as
defined in the Notes) and Other Notes (collectively, the “Notes”) held by each
Purchaser. The Borrower shall not issue any Other Notes unless the Purchaser(s)
of such Other Notes shall have agreed to the terms set forth below regarding the
Collateral Agent (as defined below):
 
i. Each Purchaser shall be deemed to appoint the Lender as the Collateral Agent
under the Security Documents (the “Collateral Agent”) and each Purchaser
authorizes the Collateral Agent to take such action as agent on its behalf and
to exercise such powers under the Security Documents as are delegated to the
Collateral Agent under such agreements and to exercise such powers as are
reasonably incidental thereto. Without limiting the foregoing, each Secured
Party hereby authorizes the Collateral Agent to execute and deliver, and to
perform its obligations under, each of the documents to which the Collateral
Agent is a party relating to security for the obligations under the Notes, to
exercise all rights, powers and remedies that the Collateral Agent may have
under such Security Documents and, in the case of the Security Documents, to act
as agent for the Purchasers under such Loan Documents.
 
3

--------------------------------------------------------------------------------

 
ii. The Collateral Agent shall not be required to exercise any discretion or
take any action, but shall be required to act or to refrain from acting (and
shall be fully protected in so acting or refraining from acting) upon the
instructions of the Purchasers holding at least 51% of the aggregate amount of
the Notes then outstanding, and such instructions shall be binding upon all
Purchasers; provided, however, that the Collateral Agent shall not be required
to take any action that (i) the Collateral Agent in good faith believes exposes
it to personal liability unless the Collateral Agent receives an indemnification
satisfactory to it from the Purchasers with respect to such action or (ii) is
contrary to this Agreement or applicable law.
 
iii. In performing its functions and duties under the Security Documents and the
other documents required to be executed or delivered in connection therewith,
the Collateral Agent is acting solely on behalf of the Purchasers and its duties
are entirely administrative in nature. The Collateral Agent does not assume and
shall not be deemed to have assumed any obligation other than as expressly set
forth herein. The Collateral Agent may perform any of its duties under any
Security Document by or through its agents or employees.
 
iv. None of the Collateral Agent, any of its affiliates or any of their
respective directors, officers, agents or employees shall be liable for any
action taken or omitted to be taken by it, him, her or them under or in
connection with the Security Documents, except for its, his, her or their own
gross negligence or willful misconduct.
 
v. Each Secured Party acknowledges that it shall, independently and without
reliance upon the Collateral Agent or any other Secured Party conduct its own
independent investigation of the financial condition and affairs of the Company
and its Subsidiaries in connection with the issuance of the Securities. Each
Secured Party also acknowledges that it shall, independently and without
reliance upon the Collateral Agent or any other Secured Party and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement and other Loan Documents.
 
vi. Each Purchaser agrees to indemnify the Collateral Agent and each of its
affiliates, and each of their respective directors, officers, employees, agents
and advisors (to the extent not reimbursed by the Borrower), from any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses and disbursements (including fees, expenses and disbursements of
financial and legal advisors) of any kind or nature whatsoever that may be
imposed on, incurred by, or asserted against, the Collateral Agent or any of its
affiliates, directors, officers, employees, agents and advisors in any way
relating to or arising out of the Security Documents or any action taken or
omitted by the Collateral Agent under the Security Documents or the document
related thereto; provided, however, that no Purchaser shall be liable for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from the Collateral
Agent’s or such Affiliate’s gross negligence or willful misconduct.
 
vii. The Collateral Agent may resign at any time by giving written notice
thereof to the Purchasers and the Company. Upon any such resignation, the
Purchasers shall have the right to appoint a successor Collateral Agent. If no
successor Collateral Agent shall have been so appointed by the Purchasers, and
shall have accepted such appointment, within 30 days after the retiring
Collateral Agent’s giving of notice of resignation, then the retiring Collateral
Agent may, on behalf of the Purchasers, appoint a successor Collateral Agent,
selected from among the Purchasers. Upon the acceptance of any appointment as
Collateral Agent by a successor Collateral Agent, such successor Collateral
Agent shall succeed to, and become vested with, all the rights, powers,
privileges and duties of the retiring Collateral Agent, and the retiring
Collateral Agent shall be discharged from its duties and obligations under this
Agreement, the Loan Documents and any other documents required to be executed or
delivered in connection therewith. Prior to any retiring Collateral Agent’s
resignation hereunder as Collateral Agent, the retiring Collateral Agent shall
take such action as may be reasonably necessary to assign to the successor
Collateral Agent its rights as Collateral Agent under the Loan Documents. After
such resignation, the retiring Collateral Agent shall continue to have the
benefit of this Agreement as to any actions taken or omitted to be taken by it
while it was Collateral Agent under this Agreement, the Security Documents and
any other documents required to be executed or delivered in connection
therewith.
 
4

--------------------------------------------------------------------------------

 
viii. Each Purchaser agrees that any action taken by the Collateral Agent in
accordance with the provisions of this Agreement or of the other document
relating thereto, and the exercise by the Collateral Agent or the Purchasers of
the powers set forth herein or therein, together with such other powers as are
reasonably incidental thereto, shall be authorized and binding upon all of the
Purchasers.
 
ix. Each of the Purchasers hereby directs, in accordance with the terms hereof,
the Collateral Agent to release (or in the case of clause (ii) below, release or
subordinate) any Lien held by the Collateral Agent for the benefit of the
Purchasers against any of the following: (i) all of the Collateral upon payment
and satisfaction in full of all obligations under the Notes and all other
obligations under the Loan Documents that the Collateral Agent has been notified
in writing are then due and payable; (ii) any assets that are subject to a Lien;
and (iii) any part of the Collateral sold or disposed of by the Company if such
sale or disposition is permitted by this Agreement and the other Loan Documents
(or permitted pursuant to a waiver or consent of a transaction otherwise
prohibited by this Agreement and the other Loan Documents). Each of the
Purchasers hereby directs the Collateral Agent to execute and deliver or file
such termination and partial release statements and do such other things as are
necessary to release Liens to be released pursuant to this Section promptly upon
the effectiveness of any such release.
 
x. Each Purchaser acknowledges that the security interests evidenced by the
Security Documents is subject to termination as set forth in Section 5(c) below.
 
c. Notwithstanding anything to the contrary contained herein, in the Security
Documents or in any documents evidencing the Other Notes (including any
agreements with Purchasers other than the Lender), the security interest
evidenced by the Security Documents shall be terminated and of no further force
and effect on and after February 14, 2008 unless, (i) an Event of Default shall
have occurred under the Notes and be continuing or (ii) on or prior to February
13, 2008, the Lender shall have fully funded the Platinum Follow-On Investment.
Upon any such termination, Lender shall promptly return any collateral under the
Security Documents to the Company and take any action reasonably requested by
the Company to cause the release of the security interests created under the
Security Documents. In the event the Lender shall have funded the Platinum
Follow-On Investment, the security interests created under the Security
Documents will remain in full force and effect.
 
5

--------------------------------------------------------------------------------

 
d. The Company shall pay the legal fees and expenses of the Lender in an amount
equal to $7,500 (which amount may be withheld from funds delivered by the Lender
at closing hereunder or delivered by the Company promptly following closing
hereunder); provided that it is understood that no additional legal fees and
expenses shall be due to Lender in connection with the Platinum Follow-On
Investment.
 
e. The representations and warranties of the Borrower contained herein shall not
survive the Closing Date.
 
f. This Agreement shall be governed by and construed in accordance with the laws
of the State of New York without giving effect to conflicts of laws principles
that would result in the application of the substantive laws of another
jurisdiction. This Agreement shall not be interpreted or construed with any
presumption against the party causing this Agreement to be drafted. 
 
g. Each of the Borrower and the Lender (i) hereby irrevocably submits to the
jurisdiction of the United States District Court sitting in the Southern
District of New York and the courts of the State of New York located in New York
county for the purposes of any suit, action or proceeding arising out of or
relating to this Agreement or the Loan Documents and (ii) hereby waives, and
agrees not to assert in any such suit, action or proceeding, any claim that it
is not personally subject to the jurisdiction of such court, that the suit,
action or proceeding is brought in an inconvenient forum or that the venue of
the suit, action or proceeding is improper. Each of the Borrower and the Lender
consents to process being served in any such suit, action or proceeding by
mailing a copy thereof to such party at the address set forth in the Note and
agrees that such service shall constitute good and sufficient service of process
and notice thereof. Nothing in this Section 5(d) shall affect or limit any right
to serve process in any other manner permitted by law.
 
h. Any forbearance, failure, or delay by the Lender in exercising any right,
power, or remedy shall not preclude the further exercise thereof, and all of the
Lender’s rights, powers, and remedies shall continue in full force and effect
until specifically waived in writing by the Lender.
 
i. This Agreement may be executed in two or more counterparts, all of which
shall be considered one and the same agreement and shall become effective when
counterparts have been signed by each party and delivered to the other party.
 
j. The headings of this Agreement are for convenience of reference and shall not
form part of, or affect the interpretation of, this Agreement.
 
k. If any provision of this Agreement shall be invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall not affect the validity
or enforceability of the remainder of this Agreement or the validity or
enforceability of this Agreement in any other jurisdiction.
 
6

--------------------------------------------------------------------------------

 
l. This Agreement, the Note and the instruments referenced herein contain the
entire understanding of the parties with respect to the matters covered herein
and therein. No provision of this Agreement may be waived or amended other than
by an instrument in writing signed by the party to be charged with enforcement.
 
m. This Agreement shall be binding upon and inure to the benefit of the parties
and their successors and assigns. The Borrower shall not assign this Agreement
or any rights or obligations hereunder without the prior written consent of the
Lender. Notwithstanding the foregoing, the Lender may assign its rights
hereunder to any other person or entity without the consent of the Borrower.
 
n. This Agreement is intended for the benefit of the parties hereto and their
respective permitted successors and assigns, and is not for the benefit of, nor
may any provision hereof be enforced by, any other person.
 
o. All remedies of the Lender under this Agreement, the Note and the other Loan
Documents (i) are cumulative and concurrent, (ii) may be exercised
independently, successively or together with other lenders against the Borrower,
(iii) shall not be exhausted by any exercise thereof, but may be exercised as
often as occasion therefore may occur, and (iv) shall not be construed to be
waived or released by the Lender’s delay in exercising, or failure to exercise,
them or any of them at any time it may be entitled to do so.
 
p. All notices required hereunder shall be made in accordance with Section 17 of
the Note.
 
7

--------------------------------------------------------------------------------

By executing the appropriate signature line below, the Borrower, intending to be
legally bound hereby, agrees to the terms and conditions of this Agreement as of
the date hereof.

       
Very truly yours,
 
Platinum Long Term Growth VII LLC
 
   
   
  By:      

--------------------------------------------------------------------------------

Name:   Title: 

QuantRx Biomedical Corporation
 

By:   

--------------------------------------------------------------------------------

Name: Walter W. Witoshkin
Title: Chairman & CEO

8

--------------------------------------------------------------------------------

Exhibit A

[Form of Note]

9

--------------------------------------------------------------------------------

Exhibit B

[Form of Warrant]

10

--------------------------------------------------------------------------------

Exhibit C

[Stock Pledge Agreement]

11

--------------------------------------------------------------------------------

Exhibit D

[IP Security Agreement]
 
12

--------------------------------------------------------------------------------