Healthcare Industry News:  Auxilium Pharmaceuticals 

Biopharmaceuticals Distribution

 News Release - December 12, 2006

Paladin and Auxilium Sign Exclusive Distribution Agreement for Testim'R'

MONTREAL, QUEBEC--(Healthcare Sales & Marketing Network)--Dec 12, 2006 -- Paladin Labs Inc. (TSX:PLB.TO ), a leading Canadian specialty pharmaceutical company, today announced that it has entered into an exclusive Canadian distribution agreement with Auxilium Pharmaceuticals, Inc. (NASDAQ:AUXL ) to market TestimŪ, a testosterone gel approved by Health Canada and indicated for testosterone replacement therapy in adult males for conditions associated with a deficiency or absence of endogenous testosterone. Paladin expects to launch TestimŪ in the 2nd quarter of 2007. The terms of the agreement were not disclosed.

"We are proud that Auxilium has selected us to be their partner in Canada. TestimŪ will benefit from Paladin's experience and knowledge of the testosterone replacement market and will further strengthen our growing urology franchise which includes OxytrolŪ and TrelstarŪ", said Jonathan Ross Goodman, President and CEO of Paladin Labs

According to IMS Canada, the Canadian market for testosterone replacement therapies exceeded $33 million in 2005.

"We are pleased to have Paladin as a partner, given their specialty urology focus, their existing commercial infrastructure in Canada, and the successful track record they have established in acquiring and launching differentiated products in that territory," said Armando Anido, Auxilium's Chief Executive President and President "This agreement enables us to bring our innovative testosterone replacement product to Canadian patients and to continue to expand the reach of our TestimŪ franchise outside the United States."

About TESTIMŪ

TestimŪ is a proprietary, topical 1% testosterone gel that treats hypogonadism by raising testosterone blood levels back to normal for the 24-hour period following application. TestimŪ is packaged in a convenient, easy-to-open, single-use tube. Patients apply TestimŪ once a day to the upper arms and shoulders and its active ingredient, testosterone, is absorbed through the skin and into the bloodstream.

For more information about TestimŪ, detailed product profile is available at www.testim.com.

About Paladin Labs Inc.

Paladin Labs Inc., headquartered in Montreal, Canada, is a leading specialty pharmaceutical company focused on developing, acquiring or in-licensing innovative pharmaceutical products for the Canadian market. With this strategy, a focused national sales team and proven marketing expertise, Paladin has evolved into one of Canada's leading specialty pharmaceutical companies. Paladin's shares trade on the Toronto Stock Exchange under the symbol PLB. For more information about Paladin, please visit the Paladin Web Site at www.paladinlabs.com.

These forward-looking statements, by their nature, necessarily involve risks and uncertainties that could cause actual results to differ materially from those contemplated by the forward-looking statements. The Company considers the assumptions on which these forward-looking statements are based to be reasonable at the time they were prepared, but cautions that these assumptions regarding the future events, many of which are beyond the control of the Company and its subsidiaries, may ultimately prove to be incorrect. Factors and risks, which could cause actual results to differ materially from current expectations, are discussed in the annual report as well as in the Company's Annual Information Form for the year ended December 31, 2005. The Company disclaims any intention or obligation to update or revise any forward-looking statements whether a result of new information, future events, or except as required by law. For additional information on risks and uncertainties relating to these forward-looking statements, investors should consult the Company's ongoing quarterly fillings, annual report and Annual Information Form and other fillings found on SEDAR at www.sedar.com


Source: Paladin Labs

Issuer of this News Release is solely responsible for its content.
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