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Annual General Meeting of Shareholders - Axcan Prepares for a New Era of Growth - Advances ITAX Development Program and Launch Strategy


Feb 17, 2005 - 12:00 ET

MONT-SAINT-HILAIRE, Quebec, Feb. 17 - During the Axcan
Pharma Inc. ("Axcan" or the "Company") annual shareholders' meeting held today
in Montreal, President and Chief Executive Officer, Mr. Léon F. Gosselin,
announced a new era of growth for Axcan citing as key factors, the expansion
of the Company's product pipeline during the last five years, including the
potential "blockbuster" drug, ITAX (itopride hydrochloride) for the treatment
of functional dyspepsia, and a 9% to 11% increase in the fiscal 2005 research
and development budget. Total revenues for the Company in fiscal 2004 were
$243.6 million with net income of $48.7 million (all dollar amounts stated in
US dollars).
    
"Beyond the year 2007, I strongly believe that Axcan will be able to
launch innovative products at an average rate of one per year for each of the
following five years," said Mr. Gosselin. "That is why we believe that a
substantial increase in our research and development budget for fiscal 2005 is
necessary to take full advantage of the multiple new product launch
opportunities that the future holds for Axcan, including ITAX, which could be
the biggest product in Axcan's history."
    
Mr. Gosselin pointed out that ITAX alone could "more than double" Axcan's
revenues. The Company has built a strong multi-product gastrointestinal base
focusing on unmet therapeutic needs. Axcan's core business, always geared
towards gastroenterology, revolves around five therapeutic areas: diseases of
the liver, the pancreas, the bowel, gastrointestinal (GI) and GI-related
cancers and other gastrointestinal disorders.
    
Apart from the Company's present portfolio and pipeline of products,
shareholders also learned that Axcan is well positioned to pursue strategic,
accretive acquisitions with $70 million in annual cash flow, $40 million in
cash and cash equivalents and a $125-million unused credit facility.
    
Assuming continued positive results of clinical trials and regulatory
approval, Axcan's product candidates approaching commercialization are:

/T/

    -------------------------------------------------------------------------
    Product Candidate    Indication              Estimated Launch Date
    -------------------------------------------------------------------------
    HELIZIDE             Eradication of          - Second half, fiscal  2006
                         Helicobacter
                         pylori bacterium
    -------------------------------------------------------------------------
    CANASA (rectal gel)  Treatment of Distal     - Second half, fiscal 2006
                         Ulcerative Colitis
    -------------------------------------------------------------------------
    ITAX                 Treatment of            - First half, fiscal 2007
                         Functional Dyspepsia

                         Treatment of            -  Fiscal 2008
                         Diabetic Gastroparesis
    -------------------------------------------------------------------------
    HEPENAX              Treatment of            - Second half, fiscal 2008
                         Porto-Systemic
                         Encephalopathy
    -------------------------------------------------------------------------
    PHOTOFRIN            Treatment of            - Phase III to start during
                         Cholangiocarcinoma        second quarter 2005

                                                 - Launch date to be
                                                   determined
    -------------------------------------------------------------------------

/T/

ABOUT AXCAN PHARMA

Axcan is a leading specialty pharmaceutical company involved in the field
of gastroenterology. Axcan markets a broad line of prescription products sold
for the treatment of symptoms in a number of gastrointestinal diseases and
disorders such as inflammatory bowel disease, irritable bowel syndrome,
cholestatic liver diseases and complications related to cystic fibrosis.
Axcan's products are marketed by its own sales force in North America and
Europe. Its common shares are listed on the Toronto Stock Exchange under the
symbol "AXP" and on the NASDAQ National Market under the symbol "AXCA".

/T/

    "Safe Harbor" statement under the Private Securities Litigation Reform
    Act of 1995.

    This release contains forward-looking statements, which reflect the
    Company's current expectations regarding future events. To the extent any
    statements made in this release contain information that is not
    historical, these statements are essentially forward looking and are
    often identified by words such as "anticipate," "expect," "estimate,"
    "intend," "project," "plan" and "believe." Forward-looking statements are
    subject to risks and uncertainties. Actual results could differ
    materially from those projected herein and depend on a number of factors,
    including, but not limited to, the successful and timely completion of
    clinical studies, the difficulty of predicting FDA and other regulatory
    approvals, the commercialization of a drug or therapy after regulatory
    approval is received, acceptance and demand for new pharmaceutical
    products, the impact of competitive products and pricing, new product
    development and launch, reliance on key strategic alliances, availability
    of raw materials, the regulatory environment, fluctuations in our
    operating results, the protection of our intellectual property and other
    risks detailed from time to time in the Company's filings with the
    Securities and Exchange Commission and under the Canadian Securities
    Commissions. The Company disclaims any obligation to update these
    forward-looking statements. The reader is cautioned not to rely on these
    forward-looking statements.

    The names ITAX, Salofalk, Helizide, Hepenax, Photofrin and Canasa
    appearing in this press release are trademarks of Axcan Pharma Inc. and
    its subsidiaries.

/T/


David W. Mims, Executive Vice President and 
Chief Operating Officer, Axcan Pharma Inc., (205) 991-8085, ext. 3223;
Or Julie M. Thibodeau, Manager, Investor Relations, Axcan Pharma Inc., 
(450) 467-2600, ext. 2062; www.axcan.com; Source: Axcan Pharma Inc.