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Paladin Labs Inc.: Paladin Announces Closing of $58.7 Million Bought Deal Financing and Exercise of Over-Allotment Option

^{Published on 2009-06-11 05:56:38, Last Modified on 2009-06-11 05:57:52 - Market Wire}
 

MONTREAL, QUEBEC--(Marketwire - June 11, 2009) - Paladin Labs Inc. (TSX:PLB), a leading Canadian specialty pharmaceutical company, today announced that it has closed its previously announced bought deal offering of 3,450,000 common shares which includes 450,000 common shares issued by way of the underwriters' over-allotment option. The common shares were issued at a price of $17.00 per common share for total gross proceeds to Paladin of approximately $58.7 million. The syndicate of underwriters for the offering was co-led by Cormark Securities Inc. and GMP Securities L.P. and included Desjardins Securities Inc. and TD Securities Inc.

Joddes Limited ("Joddes"), a private Canadian corporation and a significant shareholder of Paladin, purchased 750,000 common shares under the offering. Following the closing of the offering Joddes owns approximately 38% of the outstanding common shares of Paladin.

The net proceeds of the offering will be used as follows: (i) approximately $7,000,000 to fund the transaction with Isotechnika Inc.; (ii) approximately $4,350,000 to fund the development of Voclosporin for psoriasis and transplantation; (iii) approximately $10,760,000 to fund the final payment related to the acquisition of Dexedrine^®; and (iv) the balance to continue Paladin's strategy of acquiring products with existing sales and to in-license and launch innovative brands.

"Since the founding of the company in 1996, we have invested more than $140 million in acquiring and in-licensing innovative products and companies to grow Paladin into Canada's leading specialty pharmaceutical company. We are proud of the fact that these acquisitions have been financed predominantly from internally-generated cash flows." commented Jonathan Ross Goodman, President and CEO of Paladin Labs. "Last year the pace of acquisitions accelerated, as we invested $45 million and completed 10 transactions. We continue to see exciting opportunities to expand our product portfolio and geographic reach, and we look forward to deploying this capital to the benefit of Canadian patients and our shareholders."

THE COMMON SHARES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS ABSENT U.S. REGISTRATION OR AN APPLICABLE EXEMPTION FROM U.S. REGISTRATION REQUIREMENTS.

About Paladin Labs Inc.

Paladin Labs Inc., headquartered in Montreal, Canada, is a specialty pharmaceutical company focused on 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 Company's web site at [ www.paladinlabs.com ].

This press release may contain forward-looking statements and predictions. 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 subsidiary, 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, 2008. The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information or future events and 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 ]