Paladin Labs Inc. Announces Research and Development Contribution from the National Research Council of Canada Industrial Research Assistance Program for its Chimigen(R) Platform

MONTREAL, QUEBEC and EDMONTON, ALBERTA--(Marketwire - July 16, 2009) - Paladin Labs Inc. (TSX: PLB), a leading Canadian specialty pharmaceutical company, announced today that its biotechnology division, ViRexx, has received a contribution from the National Research Council of Canada Industrial Research Assistance Program (NRC-IRAP). This 14-month project will focus on the development of bio-nanoparticle-based siRNA therapeutic vaccines using Chimigen® Vaccine Platform for Hepatitis B (HBV) and Hepatitis C (HCV) infections.

“We are pleased to be working with NRC to further develop this promising technology, and the financial support, in addition to both technical and business oriented advisory services, from NRC-IRAP will accelerate the development of ViRexx’s proprietary Chimigen® Platform for multiple uses in the field of infectious diseases,” commented Dr. Rajan George, the Chief Technology Officer of ViRexx.

ViRexx is currently developing a Chimigen® HBV Therapeutic Vaccine to address the 370 million chronic carriers of Hepatitis B virus worldwide, who are poorly served by existing therapies. ViRexx is also developing Chimigen® HCV Therapeutic vaccines, as well as bio-nanoparticle-based siRNA therapeutic vaccines for both HBV and HCV infections.

“The acquisition of ViRexx gave us a very promising technology in Chimigen® Platform. We are excited to be working with NRC-IRAP on the development of this important technology platform”, added Jonathan Ross Goodman, President and CEO of Paladin Labs Inc.

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.

About ViRexx

ViRexx, a division of Paladin Labs Inc., develops innovative targeted therapeutics for individuals that suffer from infectious diseases and cancer. Using its Chimigen® Platform Technology, ViRexx has developed a portfolio of biotherapeutic agents to meet major unmet medical needs such as treatments for chronic hepatitis B and hepatitis C virus infections, avian influenza, alphavirus infections and cancer. ViRexx is also developing this technology for targeted siRNA delivery.

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 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, 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.