Paladin Labs Inc. Mark Beaudet Interim President & Chief Executive Officer

1. Paladin Labs Inc.Mark BeaudetInterim President & Chief Executive Officer

2. Forward Looking Statements This presentation 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, 2011. 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.

3. Company Overview • Paladin Labs is a specialty pharmaceutical company focused on acquiring or in-licensing innovative pharmaceutical products for the Canadian & select international markets. • Strong revenue growth • 5 year CAGR revenue growth of 24% • Revenue $141.5 million, up 11% versus 2010 • Healthy, robust business • Generated $67.6 million of EBITDA in 2011 or $3.27 per fully diluted share up 12.4% from the prior year • Rich, near-term pipeline for growth • 1 product awaiting regulatory approval • Silenor® • 5 products pending regulatory submission • Travelan®, VS-Sense OTC, AL-Sense OTC, Xomolix ®, Tostran® • 15 products in phase I, II and III • Well poised to continue executing our growth strategy with $239 million in cash as at December 31, 2011

4. Proven Strategies • Licensing of innovative pharmaceuticals • Acquisition of mature products from Big Pharma • Acquire “under-promoted” products from Big Pharma • To internally develop near-term, low risk/low expense products for the Canadian or world market.

5. Key Partnerships Paladin has partnered with over 30 companies including:

6. Management Team Mr. Jonathan Ross Goodman, B.A., LL.B, M.B.A. - President & CEO (Medical Leave) Mr. Mark A. Beaudet, B. Comm - Interim President & CEO Ms. Samira Sakhia, B. Comm, C.A., M.B.A. - Chief Financial Officer Mr. Mark Nawacki, B.A., C.A., M.B.A. - Vice President, Business & Corp. Dev. Dr. Patrice Larose, B Pharm., PhD – Vice President, Scientific Affairs Mr. Mike Freeman, LL.B., M.B.A. - Vice President, Government Affairs

7. Board of Directors Mr. Ted Wise, Co-founder of Pharmascience Inc. & Chairman of Paladin Labs Mr. Gerald McDole, Former President of AstraZeneca Canada Mr. James C. Gale, Managing Director, Signet Healthcare Partners Mr. Robert Lande, Chief Financial Officer of Forex Capital Markets LLC Mr. Joel Raby, Former Senior Vice-President of Burgundy Asset Management Mr. Jonathan Ross Goodman, Co-founder, President & CEO and Director (Medical Leave) Mr. Mark A. Beaudet, Co-founder, Interim President & CEO & Director

8. Revenue Growth • 15 consecutive years of record revenues • Revenues for 2011 of $141.5 million, up 11% versus 2010 (millions CDN)

9. Healthy Robust Business • 9consecutive years of record EBITDA with EBITDA representing 48% of revenues in 2011 • EBITDA for 2011 of $67.6 million, up 20% versus 2010 (millions CDN)

10. Key Products Base Business Attention deficit hyperactivity disorder DEXEDRINE® (dextroamphetamine sulfate) Pain Once-daily treatment for moderate pain Management of breakthrough cancer pain Treatment for acute pain Urology Testosterone treatment therapy gel Palliative treatment of prostate cancer and endometriosis OTC Emergency contraceptive

11. Dexedrine: A large and stable mature brand • An anti-ADHD and narcolepsy drug • Mature product with established revenue stream • Largest product by revenue • Canadian sales of Dexedrine were $17.7 million for the year ended December 31, 2011* up 9% from the same period in 2010 * IMS Canadian Drug and Hospital Audit, December 2011

12. Tridural: A new way to treat pain • The management of pain of moderate severity for several days or more • Benefits • Initial rapid release • Rapid titration • Effective 24 hour pain • Favourable safety profile • Opportunity for Tridural • Market value of over $26 MM* in 2011 • Market share exceeds 50% * IMS Canadian Drug and Hospital Audit, December 2011

13. Metadol: A strong profile in severe pain • Long acting opioid analgesic indicated for the treatment of chronic cancer and non-cancer pain • Benefits • Controls pain for opioidtolerant patients • Effective for neuropathic pain • Reimbursed by most provincial formularies • Opportunity for Metadol • Continued growth in a stable, mature market • Sales increased 17%* in 2011 * IMS Canadian Drug and Hospital Audit, December 2011

14. Abstral: Innovation in breakthrough pain • Rapidly dissolving fentanyl, indicated for the treatment of breakthrough cancer pain • Benefits • Only oral tablet formulation in Canada • Rapid Acting • Short Lasting • Opportunity for Abstral • Proven medical need - class sales exceeded $480 MM* in the US in 2011. • First immediate release fentanyl available in Canada • Launched June 2011 * WoltersKluwerTRx Sales

15. Treatment for testosterone deficiency in men Benefits Rapidly absorbed Convenient to use Gel is the preferred testosterone replacement format Opportunity for Testim Continued strong growth The testosterone gel market grew 16%* in 2011 Testim sales grew 21%* in 2011 Testim: A superior testosterone replacement gel * IMS Canadian Drug and Hospital Audit, December 2011

16. Trelstar: A better way to manage prostate cancer • Treatment for advanced prostate cancer & endometriosis • Trelstar (3.75 mg) 1 month depot • Trelstar LA (11.25 mg) 3 month depot • Benefits • Survival data • Smaller needle size • Opportunity • Large market : $148* MM in 2011 • Sales increased 32%* for the year * IMS Canadian Drug and Hospital Audit, December 2011

17. Over the Counter Portfolio • Expanded from 1 product, Cerumol, in 1999 to 9 products in 2011 • Acquired 2 Brands in 2011 • Tempra - Feb 2011 • Zincofax - June 2011 • OTC sales have grown 18%* to $20.5* MM in 2011 • 3 newly acquired products in the pipeline • AL-Sense • VS-Sense • Travelan * IMS Canadian Drug and Hospital Audit, December 2011

18. Pipeline *IMS Canadian Drug and Hospital Audit , past 12 months ending Dec. 2012.

19. International Strategy • Establish international commercialization “platforms” in fast growth, emerging markets that are ex US, EU and Japan. • Similar financial, legal and governmental systems/ processes • Stable societies, economies and currencies • Business models consistent with our own - “search, acquire and commercialize” • Proven local operators, competency in core business functions • International management bandwidth • Financial oversight and control • Provide a path to majority ownership • Strategic and financial investment potential to Paladin.

20. International Product Rights

21. International Strategy Why South Africa? • English language, English common law system and similar regulatory systems provide for a simpler and more stable operating environment • Comfortable with the pace of political reforms and overall socio-political risk profile • “Macro” Factors Attractive: • Africa’s collective GDP in 2008 roughly equaled Brazil or Russia – McKinsey projects 2020 collective GDP to grow to USD $2.6 trillion* • Households with disposable income of at least USD$ 5k projected to grow by 50% from 85 million in 2008 to 128 million in 2020* * McKinsey & Co. (“Lions on the move: the progress and potential of African economies”)(June 2010)

22. Pharmaplan – Paladin’s 1st International Investment • A leading independent specialty pharmaceutical company South Africa. • A staged approach • Initial investment of 35% in March 2010 • Acquired an additional 10% in March 2011 • Results have been strong. • Revenue of $46.3 MM in 2011 • +30.5% / +$10.8 MM vs. the 290 days ended December 2010. • Net Income of $9.2 MM in 2011 • +68.5% / +$3.7 MM vs. the 290 days ended December 2010

23. Investment in The Litha Healthcare Group About Litha • JSE-listed integrated healthcare company with a varied product offering in: • Vaccines • Pharmaceuticals • Medical devices • 46 separate license partners and has extensive contracts in both the public and private healthcare sector • Strong financial results • Strong management team and Board of Directors • Strong BBEE rating and a strong commitment further improvement

24. Investment in The Litha Healthcare Group 3 2 1 Paladin Acquires Remaining 55% of Pharmaplan Paladin Acquires Half of Blackstar’sLitha Holdings Paladin Merges Pharmaplan with Litha’sPharma Division Paladin Acquires 44.5% of Litha Healthcare Group • Total outlay $52 MM - $48 MM Cash, $4 MM PLB Shares • Expected close by July 2, 2012 • Subject to regulatory and shareholder approvals, mandatory offer to minorities • Paladin to appoint 3 board seats • Effective control of Litha - plan consolidated financial presentation • R 590 MM Valuation • $38 MM CDN Cash • 89 M shares of PLB @ $44.97 • Receives $16 MM Cash • 169 MM shares in Litha at R2.75 per share. • 73 MM Shares @ R2.75 • Deploy $26 MM CDN Cash

25. Investment in The Litha Healthcare Group Strategic Rationale: • Improves BBEE rating – improves our prospects for future business • Management team depth and increased organizational capability • Provides operational critical mass • Improved positioning for further international licensing opportunities Financial Rationale: • Attractive valuations of Pharmaplan and Litha • Transaction is expected to be immediately accretive to EBITDA • Projects an attractive ROI • Attractive growth prospects in the short, medium and longer term

26. Completed acquisition October, 2011 Strengthens top line revenues with the addition of profitable international revenue streams Improves Canadian margin Provides an opportunity to develop international partnerships Opportunity to out-license the combination product Tramadol-Acetaminophen BID Expect to complete integration by Q2 2012 Labopharm

27. Tramadol International Markets • Paladin currently has partnerships for the commercialization of Tramadol in the following International markets • USA - Purdue Pharma Products LP • France - sanofiaventis • France/Belgium - Grünenthal GmbH • Germany - HEXAL AG • Spain/Portugal - Esteve SA • Italy - GruppoAngelini [AziendeChimicheRiuniteAngelini Francesco A.C.R.A.F.S.p.A.] • Eastern Europe - CSC Pharmaceuticals • Australia - iNova Pharmaceuticals (Australia) Pty Limited • South Korea - WhanIn Pharmaceutical Co., Ltd. • Greece/Cyprus - Lavipharm S.A. • Turkey - Dr. F. FrikIlac San ve Tic. A.S. • Israel - DexcelPharma Technologies Ltd. • Portugal - KironPharma • Switzerland - Gebro • Japan - Nippon Shinyaku Co., Ltd.

28. Near-Term Growth Drivers Current Pipeline Product Corporate

29. Strong Balance Sheet to Fund Future Growth Current Share Price (April 27, 2012) Shares Outstanding (Year ended 2011) Cash and Marketable Securities (Year ended 2011) EBITDA (Year ended 2011) Revenue (Year ended 2011) $40.03 20.3M $239.0M $67.6M $141.5M Analyst Coverage: Bloom Burton & Co. (Philippa Flint) Paradigm Capital (Alan Ridgeway) Byron Capital Management (Douglas Loe) RBC Dominion Securities Inc. (Douglas Miehm) Desjardins Securities (Pooya Hemami) TD Newcrest (Lennox Gibbs) GMP Securities Ltd. (Cosme Ordonez)

30. Summary • Proven partner for the Canadian market • Expanding internationally to fuel future growth • Demonstrated track record of profitable growth • Proven ability to fill a product pipeline • Experienced & dynamic management team • Financial strength to execute our strategy

31. Forward Looking Statements This presentation 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, 2010. 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.

32. Paladin Labs Inc.Mark BeaudetInterim President & Chief Executive Officer