Transfer of distribution agreement

In the announcement on 8 February 2010 concerning the acquisition of 18 prescription products from Cambridge Laboratories (Ireland) Limited and Cambridge Laboratories Limited (together the “Vendors”), it was noted that timing of the transfer of one of the products from the Vendors to Alliance was dependent on the related distribution contract (the “Distribution Agreement”) being executed.  This related to the appointment by Biovail Laboratories International (Barbados) SRL of one of the Vendors as the distributor in the United Kingdom and the Republic of Ireland of tetrabenazine, which is marketed under the brand names Xenazine^® in the United Kingdom and Nitoman^TM in the Republic of Ireland.

The Company is pleased to announce that the Distribution Agreement has now been executed and the benefit transferred to Alliance on 16 March 2010.  As a consequence, £1.5m of deferred consideration will now be paid to the Vendors.

Xenazine^® and Nitoman^TM are approved for use in the United Kingdom and the Republic of Ireland in connection with chorea associated with Huntington’s Disease, tardive dyskinesia and certain other indications.  The Distribution Agreement also conditionally provides for Alliance to be appointed as distributor of new formulations of tetrabenazine that are developed, including, potentially, a modified-release formulation that is currently in development for Tourette’s Syndrome in 5-16 year old children.

For further information:

John Dawson, Chief Executive
Richard Wright, Finance Director
www.alliancepharma.co.uk

Buchanan Communications   + 44 (0) 20 7466 5000

Mark Court / Stasa Filiplic / Jennie Spivey

Numis Securities Limited       + 44 (0) 20 7260 1000

Nominated Adviser: Michael Meade / Brent Nabbs
Corporate Broking: David Poutney