Pediapharm Receives FDA Supplement Approval Regarding Naproxen Suspension in the US, Receives Additional US$2 Million from Atnahs Pharma

MONTREAL, QUEBEC--(Marketwired - May 11, 2016) - NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES.

Pediapharm Inc. ("Pediapharm" or the "Company") (TSX VENTURE:PDP) is pleased to announce that it has received Food and Drug Administration ("FDA") approval regarding the manufacturing site transfer of Naproxen Suspension for the United States market. This approval triggered the second and final payment of US$2 million in cash included in a previously disclosed transaction valued at US$4.25 million regarding the United States rights to Naproxen Suspension. The acquirer, Atnahs Pharma US Limited ("Atnahs"), also owns the global rights to the Naprosyn® brand.

"We are very pleased to receive this FDA approval within the estimated timeline." stated Sylvain Chretien, President and Chief Executive Officer of Pediapharm. "As previously stated, this brings substantial non-dilutive cash which enables us to fuel the growth of our existing products and puts us in a solid position for the upcoming potential launches of rupatadine and Otixal® in 2016. Furthermore, we now have more flexibility in considering new transactions in the near future."

As previously stated, Pediapharm has retained the rights to Naproxen Suspension in Canada and will continue to commercialize it using its own sales and marketing infrastructure.

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. The company's innovative product portfolio includes NYDA®; a breakthrough treatment for head lice; EpiCeram® a non-steroid emulsion for eczema; naproxen suspension, indicated to treat pain and inflammation due to various conditions, including Juvenile Idiopathic Arthritis; and a broad pipeline of products under registration.

About Atnahs Pharma

Atnahs Pharma US Ltd is a family owned, fast-growing, speciality pharmaceutical business. Atnahs seeks to acquire "mature" and established branded products from large cap or speciality pharma and currently has nine major products and sales in 35 territories. Atnahs' Management Team is leveraging its depth of experience and heritage to create a new platform for growth, as a trusted manager for mature brands; the same Management Team has completed over half a billion pounds worth of deals with large pharma. International deals of niche established branded medicines, coupled with a pipeline of niche generic medicines developed in our own facility, form the core of our strategy.

FORWARD LOOKING STATEMENTS

This news release contains forward-looking statements that involve risks and uncertainties, including without limitation, statements pertaining to the benefits of the Proposed Transaction, the consideration payable thereunder and the receipt of all necessary approvals. Actual results may differ materially. Pediapharm 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. More detailed information about potential factors that could affect the current expectations or beliefs of the Company is included in the documents filed from time to time with the Canadian securities regulatory authorities by Pediapharm.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.