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CORRECTION FROM SOURCE: Stellar Pharmaceuticals Announces 2006 Fourth Quarter and Year-End Financial Results

CORRECTION FROM SOURCE: Stellar Pharmaceuticals Announces 2006 Fourth Quarter and Year-End Financial Results

LONDON, ONTARIO -- (MARKET WIRE) -- 03/30/07 -- The following corrects and replaces the release sent on MARCH 30, 2007 at 07:30 ET. The second paragraph, last sentence should read "Without this licensing fee, revenue for the quarter was..." and not "Without this licensing revenue, income for the quarter was..." The complete and corrected release follows.

Stellar Pharmaceuticals Inc., (TSX VENTURE: SLX)(OTCBB: SLXCF) ("Stellar" or "the Company"), a Canadian pharmaceutical developer and marketer of high quality, cost-effective products for select health care markets, today announced financial results for the fourth quarter and twelve months ended December 31, 2006. All amounts in this press release are in Canadian dollars and are stated using U.S. GAAP.

Fourth Quarter 2006 Results and Highlights

Total revenues for the three month period ended December 31, 2006 increased 486% to $3.1 million compared to $522,823 in the same period during 2005. This growth was mainly due to the initial payment received from the signing of a license agreement with Watson Pharmaceuticals Inc, completed in December 2006. Without this licensing fee, revenue for the quarter was $521,730 compared to $522,823 for the same period in 2005.

NeoVisc Regains Market Share, Uracyst continues growth

Canadian sales of NeoVisc in the fourth quarter of 2006 declined 8.8% compared to the same period in 2005. Despite this, NeoVisc continues to regain market share from the problems experienced in the fourth quarter of 2005 and first quarter of 2006. The details of which were previously announced in a press release dated March 31, 2006. With a strategy implemented in the later part of 2006 to recapture market share, Stellar is pleased to announce that the growth curve for NeoVisc in the last quarter of 2006 has moved back into the upward trend it showed in 2005. Although there can be no assurances, the Company is confident this trend should continue in 2007.

Canadian sales of Uracyst grew 23.1% for the quarter as the Canadian marketing focus continues to show good results. GAG deficient cystitis has few successful therapies and Uracyst is establishing its dominance as a treatment of choice for this disorder.

In-licensed revenue form NMP22 BladderChek also grew by 353.9% in the fourth quarter as this point of care diagnostic and monitoring device for bladder cancer continues to gain acceptance by Canadian urologists. Stellar attributes much of this growth to the success of a number of sales initiatives directed towards easing the physician prescription process, which, in turn, have helped to increase the adoption of this product in Canada.

During the fourth quarter of 2006, business development activities were focused on completing the exclusive licensing agreement for Uracyst with Watson Pharmaceuticals Inc. for the United States market. Stellar received an upfront payment of US$2.2 million upon signing this agreement and will receive additional milestone payments and an ongoing royalty stream from future sales of Uracyst in the United States, if and when sales commence. Watson will be responsible for conducting clinical trials and obtaining regulatory approvals for these products in the United States. Stellar expects that the signing of this agreement could help to further the accelerated growth of Uracyst on a global basis. One time professional fees of $252,596 were incurred in negotiating this agreement, which the Company has recorded as selling, general and administrative expenses.

Peter Riehl, the Company's President and CEO, stated. "We made significant progress this quarter. In both October and November the Company was profitable from operations, achieving a goal set for 2006. Completion of the Uracyst license and supply agreement for the United States market with a multibillion dollar pharmaceutical company was an enormous milestone and we are continuing similar efforts to locate a U.S. licensee for NeoVisc."

2006 Year-end Results and Highlights

For the year ended December 31, 2006, total operating revenues from all sources increased 125% to $4.4 million compared to $1.9 million in the same period during 2005. When revenue for 2006 is adjusted for licensing fees of $2.5 million, the revenues for 2006 would show a decrease of 5.7%. Revenues were negatively impacted by sales of NeoVisc which showed a decline of 21.5% as discussed above in "fourth quarter review". In 2006, Uracyst revenue grew by 33.8% over 2005 due mainly to growth in the Canadian market. BladderChek sales grew by 95.4% in 2006 due to strong clinical support out of the United States and growing physician support in Canada.

Gross profit for 2006 was up 194.4% to $3.9 million compared to $1.3 million in 2005. Stellar reported net income in 2006 of $1.3 million, or $0.05 per diluted share, on 23.6 million weighted average common shares outstanding ("shares outstanding"), compared to a net loss of $1.7 million, or $0.08 loss per diluted share, on 23.2 million shares outstanding in 2005. Although profitability was driven by licensing revenue, profitability from operations experienced in both October and November 2006 will be the objective the Company will strive for in 2007.

Balance Sheet Highlights

The Company has $3.5 million in cash and cash equivalents compared to $2.1 million for December 31, 2005. Stellar continues to have no long-term debt on its balance sheet at December 31, 2006.

Peter Riehl further commented "I am exceptionally pleased with our progress over the past year, despite some hurdles. I am confident our dedicated focus on continued research and development and growth of our global licensing program will continue to enhance Stellar's worldwide presence for its products."

Conference Call

Management will conduct a conference call today at 11 a.m. Eastern Time to discuss these results. Interested parties may participate in the call by dialing 877-461-2814 (in the United States) or 416-695-9753 (in Canada) approximately 10 minutes before the call is scheduled to begin and ask to be connected to the Stellar Pharmaceuticals Conference Call.

About Stellar Pharmaceuticals Inc.

Stellar has developed and is marketing direct in Canada, and in 30 countries around the world through out-license agreements, three products based on its core polysaccharide technology: NeoVisc®, for the treatment of osteoarthritis; and Uracyst® and the Uracyst® Test Kit, its patented technology for the diagnosis and treatment of interstitial cystitis (IC), an inflammatory disease of the urinary bladder wall. Stellar also has an in-licensing agreement for NMP22® BladderChek®, a proteomics-based diagnostic test for the diagnosis and monitoring of bladder cancer.

This press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Readers are cautioned not to place undue reliance on these forward-looking statements. Actual results may differ materially from those indicated by these forward-looking statements as a result of risks and uncertainties impacting the Company's business including increased competition; the ability of the Company to expand its operations, to attract and retain qualified professionals, technological obsolescence; general economic conditions; and other risks detailed from time to time in the Company's filings.

                        STELLAR PHARMACEUTICALS INC.
                              BALANCE SHEETS
                             (Canadian Funds)
                               December 31

                                                          2006        2005
                                                   -----------  ----------
 Cash and cash equivalents                       $   3,515,193 $ 2,108,755
 Accounts receivable, net of allowance $nil
  (2005 - $nil)                                        199,704     157,749
 Inventories                                           274,597     288,337
 Prepaid, deposits and sundry receivables               55,407     152,514
                                                   -----------  ----------
                                                     4,044,901   2,707,355

PROPERTY, PLANT AND EQUIPMENT                          853,818     959,999

OTHER ASSETS                                            49,691      46,187
                                                   -----------  ----------
                                                 $   4,948,410 $ 3,713,541
                                                   -----------  ----------
                                                   -----------  ----------

 Accounts payable                                $     226,026 $   487,359
 Accrued liabilities                                   135,198     122,999
 Deferred revenues                                       1,500      43,397
                                                   -----------  ----------
                                                       362,724     653,755
                                                   -----------  ----------


                          SHAREHOLDERS' EQUITY

  Unlimited   Non-voting, convertible, redeemable
               and retractable preferred shares
               with no par value
  Unlimited   Common shares with no par value

  23,819,040  Common shares (2005 - 23,470,190)      8,299,554   8,100,253
              Paid-in capital options - outstanding    513,990     545,025
                                      - expired        201,322      98,913
                                                   -----------  ----------
                                                     9,014,866   8,744,191

DEFICIT                                             (4,429,180) (5,684,405)
                                                     4,585,686   3,059,786
                                                   -----------  ----------
                                                   $ 4,948,410 $ 3,713,541
                                                   -----------  ----------
                                                   -----------  ----------

                       STELLAR PHARMACEUTICALS INC.
                        STATEMENTS OF OPERATIONS
                            (Canadian Funds)
                     FOR THE YEARS ENDED DECEMBER 31

                                                          2006        2005
                                                   -----------  ----------

PRODUCT SALES                                      $ 1,427,264 $ 1,627,670

COST OF GOODS SOLD                                     419,652     450,591
                                                   -----------  ----------

MARGIN ON PRODUCT SOLD                               1,007,612   1,177,079

ROYALTIES & LICENSING REVENUE                        2,950,433     314,581
WRITE-DOWN OF OBSOLETE INVENTORY                        (7,291)    (36,238)
OTHER PRODUCT COST                                     (29,205)   (123,152)
                                                   -----------  ----------

GROSS PROFIT                                         3,921,549   1,332,270
                                                   -----------  ----------

 Selling, general and administrative                 2,332,452   2,418,918
 Research and development                              217,607     608,957
 Amortization                                          159,117     144,582
                                                   -----------  ----------

                                                     2,709,176   3,172,457
                                                   -----------  ----------

INCOME (LOSS) FROM OPERATIONS                        1,212,373  (1,840,187)

INTEREST AND OTHER INCOME                               42,852      99,689
                                                   -----------  ----------
 TAXES                                             $ 1,255,225 $(1,740,498)

INCOME TAXES                                                 -           -
                                                   -----------  ----------

NET INCOME (LOSS)                                  $ 1,255,225 $(1,740,498)
                                                   -----------  ----------
                                                   -----------  ----------
EARNINGS (LOSS) PER SHARE             - Basic      $      0.05 $     (0.08)
                                                   -----------  ----------
                                                   -----------  ----------
                                      - Fully
                                         diluted   $      0.05 $         -
                                                   -----------  ----------
                                                   -----------  ----------
 SHARES OUTSTANDING                   - Basic       23,575,479  23,182,107
                                                   -----------  ----------
                                                   -----------  ----------
                                      - Fully
                                         diluted    23,634,070           -
                                                   -----------  ----------
                                                   -----------  ----------

                       STELLAR PHARMACEUTICALS INC.
                        STATEMENTS OF CASH FLOWS
                           (Canadian Funds)
                     FOR THE YEARS ENDED DECEMBER 31

                                                          2006        2005
                                                   -----------  ----------
 Net income (loss) for the year                    $ 1,255,225 $(1,740,498)
 Amortization                                          159,117     144,582
 Issuance of equity instruments for services
  rendered                                             114,512     257,279
                                                   -----------  ----------
                                                     1,528,854  (1,338,637)
 Change in non-cash operating assets and
  (Increase) decrease in accounts receivable           (41,955)     24,011
  Decrease in inventories                               13,740      48,154
  Decrease in prepaid, deposits and sundry
   receivables                                          97,107       3,458
  Increase (decrease) in accounts payable and
   accrued liabilities                                (249,134)    235,231
  Decrease in deferred revenues                        (41,897)   (177,923)
                                                   -----------  ----------
                                                     1,306,715  (1,205,707)
                                                   -----------  ----------

 Additions to property, plant and equipment            (51,581)   (151,558)
 Increase in other assets                               (4,859)    (30,915)
                                                   -----------  ----------
                                                       (56,440)   (182,473)
                                                   -----------  ----------
 Issuance of common stock                              156,163     324,064
                                                   -----------  ----------
                                                       156,163     324,064
                                                   -----------  ----------
CHANGE IN CASH AND CASH EQUIVALENTS                  1,406,438  (1,064,115)

CASH AND CASH EQUIVALENTS, beginning of year         2,108,755   3,172,870
                                                   -----------  ----------

CASH AND CASH EQUIVALENTS, end of year             $ 3,515,193 $ 2,108,755
                                                   -----------  ----------
                                                   -----------  ----------

Stellar Pharmaceuticals Inc.
Peter Riehl
President & CEO
(519) 434-1540 or Toll Free: 1-800-639-0643

Stellar Pharmaceuticals Inc.
Arnold Tenney
(416) 587-3200

Seventh Circle Consulting, LLC
Christine Petraglia
(646) 354-8886

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