Press Release

LONDON, ONTARIO -- (MARKET WIRE) -- Oct 05, 2010 -- Stellar Pharmaceuticals Inc. (OTCBB: SLXCF) (the "Company") is pleased to announce that subject to regulatory acceptance, the Company is arranging a non-brokered private placement consisting of up to 1,000,000 units of the Company ("Units") at a price of US$1.00 per Unit for gross proceeds of up to US$1,000,000. It is anticipated that each Unit will consist of one Common Share and one-half of a Series 1 Warrant, one-half of a Series 2 Warrant and one-half of a Series 3 Warrant (a "Unit"). Each whole Series 1 Warrant will entitle the holder to acquire one Common Share for a period of 18 months from the Closing Date at an exercise price of US$1.50, subject to adjustment as set forth in the Series 1 Warrant. Each whole Series 2 Warrant will entitle the holder to acquire one Common Share for a period of 18 months from the Closing Date at an exercise price of $2.00, subject to adjustment as set forth in the Series 2 Warrant. Each whole Series 3 Warrant will entitle the holder to acquire one Common Share for a period of 18 months from the Closing Date at an exercise price of $2.50, subject to adjustment as set forth in the Series 3 Warrant. In establishing the pricing for the Units, the market price of the Common Shares in effect at the time of the private placement negotiations was considered.

In the event that the Company at any time prior to the expiry of the Warrants issues any Common Shares or securities convertible into Common Shares to a person other than the holders of the Warrants (except (i) pursuant to options, warrants, or other obligations to issue shares outstanding on the date hereof as disclosed in the Company's SEC filings; (ii) pursuant to options that may be issued under any management incentive stock option and/or any qualified stock option plan adopted by the Company, or (iii) pursuant to an acquisition by the Company, whether structured as an asset purchase, stock purchase or merger) for a consideration per share less than the applicable exercise price in effect at the time of such issuance, then the exercise price will be reset, pro rata to reflect such lower issue price, at the time of issuance of such securities.

The proceeds from the private placement will be used for general working capital.

It is anticipated that the financing will close on or about October 8, 2010. In connection with the private placement, the Company granted customary registration rights with respect to the Common Shares covered by the Units.

About Stellar Pharmaceuticals Inc.

Stellar has developed and is marketing direct in Canada and in countries around the world through out-license agreements two products based on its core polysaccharide technology: NeoVisc®, for the treatment of osteoarthritis; and Uracyst®, its patented technology for treatment of interstitial cystitis/painful bladder syndrome, an inflammatory disease of the urinary bladder wall. Stellar also has in-licensing agreement for the distribution and sale of NMP22® BladderChek®, a proteomics-based diagnostic test for the diagnosis and monitoring of bladder cancer. For more information, please visit the company's website at www.stellarpharma.com.

Forward-Looking Statements

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.

Contacts:
Stellar Pharmaceuticals Inc.
Peter Riehl
President & CEO
(519) 434-1540
corpinfo@stellarpharma.com

Stellar Pharmaceuticals Inc.
Arnold Tenney
Chairman
(705) 445-9505
www.stellarpharma.com

Investor Contact
Kilmer Lucas Inc.
Stephen Kilmer
President
(905) 690-2400 ext. 21
stephen@kilmerlucas.com

Media Contact
Kilmer Lucas Inc.
Leonard Zehr
Managing Director
(905) 690-2400 ext. 41
len@kilmerlucas.com