Pediapharm, Inc. and Merz Pharma Canada, Ltd. Enter Into a Distribution and Supply Agreement for CUVPOSA(TM) (Glycopyrrolate) Oral Solution,...

TORONTO, ONTARIO and MONTREAL, QUEBEC--(Marketwired - April 4, 2014) -

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Pediapharm Inc. ("Pediapharm") (TSX VENTURE:PDP) and Merz Pharma Canada, Ltd. ("Merz") announce they have entered into an agreement regarding the Canadian rights to CUVPOSA™ (glycopyrrolate) oral solution intended for pediatric chronic severe drooling (sialorrhea) associated with neurologic conditions such as cerebral palsy. Pediapharm was granted exclusive commercial rights for the product in Canada.

"Merz is pleased to be expanding patient and physician access to Cuvposa™ (glycopyrrolate) oral solution through this new agreement with Pediapharm," said Bob Bennett, President and General Manager of Merz Pharma Canada. "We are dedicated to improving the quality of life for patients suffering from movement and neurological disorders such as cerebral palsy, and we look forward to collaborating with Pediapharm in order to achieve this goal."

Cerebral palsy (CP) is a lifelong condition that encompasses a group of non-progressive, neurological disorders affecting body movement and muscle coordination.

"Based on our discussions with experts in the field, chronic severe drooling is a poorly managed condition in up to 30% of children with CP. Because the treatment options available in Canada are limited, this may lead to various health issues and a decreased quality of life in that patient population", said Benoît Hébert, Pediapharm's Vice President of Business Development and Licensing. "We are delighted to collaborate with Merz in bringing this opportunity to the Canadian market as this transaction is a good example of what Pediapharm can accomplish".

CUVPOSA™ was approved by the FDA in July 2010 and has been commercially available in the U.S. since April 2011. It is the only FDA-approved treatment to reduce chronic severe drooling in pediatric patients (aged 3-16) with neurologic conditions associated with problem drooling. Sialorrhea is a common problem for individuals with neurologic conditions, especially children with cerebral palsy.

"CUVPOSA™ will be an important addition to our portfolio of innovative products and further strengthens our commitment to becoming the recognized leader in the treatment of diseases and conditions affecting children" said Sylvain Chrétien, President and Chief Executive Officer of Pediapharm Inc. "This transaction reflects our desire to accelerate the growth of the corporation by offering to Canadian healthcare providers the necessary products to treat pediatric unmet medical needs."

Pediapharm intends to register the product with Health Canada during 2014 and, if approved, expects to launch the product in 2015.

About CUVPOSA™

CUVPOSA™ is a competitive inhibitor of acetylcholine receptors that are located on certain peripheral tissues, including salivary glands. CUVPOSA™ indirectly reduces the rate of salivation by preventing stimulation of these receptors. CUVPOSA™ is available under prescription in the United States as a 1mg/5ml clear, cherry flavored oral solution.

Results of a randomized, double-blind, placebo-controlled Phase 3 study of 38 patients showed that 75% of children and adolescents, aged 3-16, treated with CUVPOSA™ experienced an improvement in symptoms of chronic severe drooling at week 8, versus 11% who received placebo. Dry mouth, vomiting, constipation, flushing and nasal congestion were the most commonly reported adverse reactions.

About Pediapharm Inc.

Pediapharm is the only Canadian specialty pharmaceutical company dedicated to serving the needs of the pediatric community. Its mission is to bring to the Canadian market the latest innovative pediatric products with the objective to improve the health and the well-being of children in Canada. Since its debut in 2008, Pediapharm has entered into numerous commercial agreements with partners from Canada and other countries around the world.

About Merz North America

Merz North America is a specialty healthcare company that develops and commercializes innovative treatment solutions in medical and aesthetic dermatology, and neurology in the U.S. and Canada. Our ambition is to become a recognized leader in the treatment of movement disorders, and in aesthetics and dermatology. Our future is promising, and we are committed to advancing new therapeutic options and improving patients' lives. For more than 100 years, the development of our products has been based on Merz's commitment to providing innovative medical approaches that earn trust of patients, physicians and partners worldwide. Globally, the companies of Merz Pharma Group are focused on medications for treating neurological and psychiatric illnesses, and they have assumed a leading role in the field of Alzheimer's disease research. Founded in 1908, Merz Pharma Group is a privately owned company headquartered in Frankfurt, Germany.

FORWARD LOOKING STATEMENTS FOR PEDIAPHARM

This news release contains forward-looking statements and other statements that are not historical. Such forward-looking statements are subject to known and unknown risks, uncertainties and assumptions that could cause actual results to vary materially from target results and the results or events predicted in these forward-looking statements. As a result, investors are cautioned not to place undue reliance on these forward-looking statements.

The forward-looking statements contained in this news release are made as of the date of this release. Except as required by applicable law, the Corporation disclaims any intention and assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking information reflects the current expectations or belief of the Corporation based on information currently available and such information is subject to a number of assumptions, risks and uncertainties described in details at pp. 35 to 41 of the Management Information Circular of Chelsea Acquisition Corporation dated November 12, 2013 available on SEDAR at www.sedar.com and other risks associated with being a specialty pharmaceutical company.

For more information about Pediapharm or its products, please visit www.pedia-pharm.com.

For more information about Merz or the Company's products, please visit www.merzusa.com

CUVPOSA™ is a trademark of Merz Pharmaceuticals, LLC.

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