DRAXIS REPORTS NET INCOME OF $806.000 FOR FIRST QTR '03.

DRAXIS Health Inc. (Nasdaq:DRAX)(TSX:DAX), Mississauga, Ontario, has reported financial results for the first quarter of 2003 ended March 31, 2003. All amounts are expressed in US dollars. Revenues from continuing operations for the quarter were $10.1 million, compared to $10.2 million for the first quarter last year. Net income from continuing operations was $806,000 ($0.02 per share) versus $978,000 ($0.03 per share) for the same quarter in 2002. Net income from discontinued operations of $4.2 million was due almost entirely to the after-tax gain from the $6.5 million payment received on the sale of rights for non-approved products back to Elan. First quarter EBITDA (pre R&D) of $2.3 million was relatively unchanged from the prior year first quarter. Revenues and earnings for the quarter include $1.4 million of previously deferred revenue related to the termination of agreements with the company's former U.S. licensee for BrachySeed(R).

"While we were able to report substantial earnings in this first quarter, much of which is due to favorable one-time-events, our ongoing operating performance was essentially flat compared to the same period last year," said Dr. Martin Barkin, president and CEO of DRAXIS. "However, it is important to recall that the first quarter of last year was particularly strong, with record revenues and earnings. A number of positive developments during the first quarter of 2003 have successfully laid the groundwork for improving results going forward. In late March we began regular shipments of Hectorol Injection for Bone Care International Inc. At the beginning of April, we launched our unique Sodium Iodide I-131 radiotherapy kit product into the U.S. under a long-term distribution agreement with Cardinal Health. International regulatory approvals for the products being manufactured under the GlaxoSmithKline (GSK) contract are allowing us to begin ramping up shipments according to schedule and we will continue to do so throughout 2003 and into 2004 when we expect to be in full production for GSK. Despite disruptions and reduced product sales in the brachytherapy market at the beginning of 2003, we have successfully realigned our sales and marketing strategy for BrachySeed(R) implants in the U.S. Initial results appear favourable and the impact of our direct marketing initiatives will be much clearer in the second half of 2003."

During the quarter DRAXIS completed the first step in its strategy to divest its Canadian pharmaceutical sales and marketing business, DRAXIS Pharmaceutica, which is accounted for as discontinued operations. Product rights for several non-marketed products were returned to Elan Corporation, plc for $6.5 million. DRAXIS is now in advanced negotiations to complete the divestiture of substantially all remaining assets of DRAXIS Pharmaceutica and there is a strong commitment by all parties to complete a transaction as soon as practicable. The contemplated transaction currently anticipates an upfront cash payment plus product-specific milestones and royalties. In 2002, the discontinued operations of DRAXIS reported revenues of $6.8 million.

Highlights from Management's Discussion and Analysis Consolidated Operations

-- Revenues from continuing operations were $10.1 million for the quarter including $1.4 million of previously deferred revenue related to the termination of agreements with the company's former U.S. licensee for BrachySeed(R), as compared to $10.2 million for the first quarter of 2002.

-- Net income from continuing operations was $806,000 ($0.022 per share) for the first quarter. This compared to $978,000 ($0.026 per share) for the same period in 2002, which included minimum royalty payments from Pfizer and significant revenues from the fulfillment of order backlogs for diagnostic imaging products. Net income in the first quarter of 2003 included a $261,000 foreign exchange translation loss related to the strengthening of the Canadian dollar.

-- Earnings before interest, income taxes, minority interest, depreciation and amortization, and research and development ("EBITDARD") from continuing operations was $2.3 million, including the $1.4 million of previously deferred revenue, versus $2.4 million in the first quarter of 2002.

-- Completion of the first step in the strategy to divest DRAXIS Pharmaceutica through the return of product rights to Elan Corporation, plc for $6.5 million. Financial results from discontinued operations recorded an after tax gain of $4.3 million in the first quarter of 2003 associated with this transaction.

-- Approval of a share buy-back program to repurchase for cancellation up to a maximum of 1,854,934 common shares. To May 16, 2003, 50,300 shares have been purchased at a weighted average cost of $1.30 per share. Radiopharmaceuticals

-- Revenues of $4.3 million for the first quarter represent an increase of $1.2 million over the first quarter of 2002.

-- EBITDARD of $2.2 million represent an increase of $0.9 million over 2002. -- Inclusion in revenues and EBITDARD of $1.4 million of previously deferred revenue related to the termination of agreements with the company's former U.S. licensee for BrachySeed(R).

-- U.S. regulatory approval for a new radiotherapeutic kit product for the treatment of thyroid cancer and hyperthyroidism followed by the launch of the product into the U.S. under a long-term distribution agreement with Cardinal Health.

-- Initiation of a Phase I clinical trial for INFECTON(TM), the company's technetium-99m-based radiopharmaceutical for imaging infection and completion in February 2003. A Phase II study is expected to commence later in 2003.

-- Subsequent to March 31, 2003 DRAXIMAGE expanded its agreements with Isogenic Sciences Limited to gain global rights to proprietary technology related to brachytherapy implants for nominal up-front consideration and also established a marketing and distribution agreement with Netherlands-based IDB Benelux covering DRAXIMAGE products for the European Benelux countries.

-- Revenues of $4.4 million for the quarter represent a decrease of $0.7 million over the first quarter of 2002.

-- EBITDA loss for the quarter was $0.7 million as compared to $0.1 million of income in 2002.

-- Results were negatively affected by production disruptions early in the quarter in sterile operations due to equipment and related problems.

-- During the quarter U.K. regulators approved the manufacture of multiple sterile and non-sterile products at DPI, including products being transferred to DPI under the outsourcing contract between DPI and GlaxoSmithKline.

-- FDA acceptance of DPI as an additional manufacturing site for Hectorol Injection for Bone Care International, Inc., and the start of commercial shipments.

-- Finalization of DPI's plans for the installation of the second lyophilizer unit. This installation is scheduled to begin in the third quarter of 2003 and the unit is expected to become operational approximately one year after installation.

-- Negotiation of a new collective agreement is scheduled to commence in the second quarter of 2003. The previous agreement expired in April 2003.

-- Subsequent to March 31, 2003 DRAXIS announced the appointment of John E. M. Durham as president of DPI, effective June 2, 2003. Durham has more than 20 years of progressive experience in pharmaceutical production including recent senior managerial experience in international pharmaceutical contract manufacturing.

About DRAXIS Health Inc.

DRAXIS Health Inc. is a specialty pharmaceutical company focused on the development, production, marketing and distribution of radiopharmaceuticals (DRAXIMAGE) and the provision of pharmaceutical contract manufacturing services, specializing in liquid and freeze-dried injectables and other sterile products (DRAXIS Pharma).

For more information, call 877/441-1984.