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Draxis Health selected by Johnson and Johnson Consumer Companies, Inc. for major contract manufacturing relationship
Date:9/5/2007

apacity utilization in the semi-solids section of our non-sterile operations. The confidence shown in DRAXIS demonstrates our ability to deliver top quality, market leading products in a highly regulated industry, which supports our efforts to build shareholder value."

Manufacturing Site Transfer Activities

The process of transferring these products to DRAXIS Pharma and validating manufacturing procedures for each new product was initiated in late 2006 and will continue through 2007 and 2008. Improvements to the existing semi-solid manufacturing facilities were undertaken during the recent regular shutdown of operations for preventative maintenance during June and July of 2007. Some compounding rooms were enlarged and supplied with required services to accommodate new equipment and additional floor space was created through the construction of a new mezzanine within the existing DRAXIS facility. Capital costs for facility improvements and new equipment specific to this contract will be recovered through a financing agreement.

Commercial production of the products is scheduled to start as soon as late 2008 and ramp up to achieve near full utilization of existing capacity for non-sterile semi-solid products by mid-2009. The contract will result in the creation of approximately 80 to 100 new positions at DRAXIS operations in the Montreal area.

Additional DRAXIS Facility

With the signing of this contract, a second DRAXIS facility in the Montreal area will be required in order to meet increased logistics and secondary packaging activities. This is due to the large number and wide range of finished product formats represented by this new business. All products will be formulated and filled in the existing facility in Kirkland, Quebec. The new secondary facility will be used for operations such as labeling, assembling different product configurations for different markets, cartoning, shipping etc.

This new facility is expected to open du
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SOURCE DRAXIS Health Inc.
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