July 31, 1998

Paladin Labs announces the appointment of 3 new board members

Paladin Labs Inc. is pleased to announce the appointment of Mr. David MacNaughtan, Mr. Daniel Pharand, and Mr. Normand Balthazard to the board of directors of Paladin Labs Inc. Mr. David Fleming has resigned from the board to accommodate the new board structure.

The new board of directors of Paladin Labs Inc. is comprised of the following members:

Directors Occupation

Ted Wise Chairman, Paladin

Jonathan Goodman President, Paladin

Mark Beaudet Vice President, Paladin

Brad Thompson Chairman, Synsorb Biotech Inc.

Robert Lande Vice President, Finance & Treasurer, Bell Canada International

Leonard Wise Pharmacist

David MacNaughtan Investment Manager, Royal Bank Capital Corporation

Daniel Pharand Vice President, Société Innovatech du Grand Montreal

Normand Balthazard President and CEO, BioCapital Investments, Limited Partnership

Paladin Labs Inc. is a public company whose shares trade on the Vancouver Stock Exchange under the symbol PLB.

The Vancouver Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release. This news release may contain forward-looking statements relating to the future performance of Paladin. Forward-looking statements, specifically those concerning future performance, are subject to certain risks and uncertainties, and actual results may differ materially.

INFORMATION: Paladins Labs Inc.

6111 Royalmount Ave.

Montreal, Quebec

H4P 2T4

Canada

Tel: (514) 340-1112

Fax: (514) 344-4675

info@paladin-labs.com

http://www.paladin-labs.com