Draxis Health selected by Johnson and Johnson Consumer Companies, Inc. for major contract manufacturing re...( Multi-year outsourcing agreement for...),Health

Multi-year outsourcing agreement for non-sterile products valued in excess

of US$120 million

MISSISSAUGA, ON, and MONTREAL, Sept. 5 /PRNewswire-FirstCall/ - DRAXIS Pharma, the contract manufacturing division of DRAXIS Health Inc. (TSX: DAX); (NASDAQ: DRAX), has expanded its existing contract manufacturing relationship with Johnson & Johnson Consumer Companies, Inc. DRAXIS Pharma has entered into a definitive supply agreement to provide commercial manufacturing services for a broad portfolio of multiple non-sterile specialty semi-solid products currently marketed in the United States.

The new multi-year contract runs to the end of 2013. It includes approximately two years of manufacturing site transfer and process validation activities followed by five years of commercial production, which is scheduled to begin in 2009. Commercial production is expected to generate incremental revenues in excess of US$120 million over the five year period of 2009 through 2013. The transfer of equipment and production technologies, which is in progress, is expected to generate additional cumulative revenues during 2007 and 2008 of approximately US$6 to US$8 million. The contract also contemplates optional extensions beyond 2013.

"The signing of this contract is a reflection of the solid business model at DRAXIS," said Dr. Martin Barkin, President and CEO of DRAXIS Health. "We are honoured to have been selected from more than 80 international contract manufacturers under a rigorous and comprehensive global selection process conducted over an extended multi-year period."

Dr. Barkin added, "This contract includes prescription and non-prescription products and will significantly improve c
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