Press Release

MILTON, ONTARIO -- (MARKETWIRE) -- May 14, 2012 -- Stellar Pharmaceuticals Inc. ("Stellar" or the "Company") (OTCQB: SLXCF)(OTCBB: SLXCF)(PINKSHEETS: SLXCF) today announced the closing of the first of two tranches of a US$6.0 million term loan from Midcap Financial LLC ("Midcap"). The Company received US$3.5 million as proceeds of the first tranche of the term loan.

The Company plans to use the funds to expand its sales force and its promotional activities to enhance the growth of its existing Canadian product line, prepare for the launch of the recently approved Cambia®, and advance pending business development initiatives. According to Rob Harris, President and CEO of Stellar, "with the recent approval by Health Canada and pending launch of Cambia®, the Company will require a stronger presence in the Canadian health care market to ensure its success."

The term loan will mature in May, 2015. In addition, in connection with each closing of a loan tranche, Stellar will grant Midcap a warrant to purchase shares of common stock equal to 8% of the amount borrowed under the tranche divided by an exercise price, based on the 20 day average closing price at the time of the draw. Warrants will be exercisable for five years from the date of issuance.

"We are pleased to partner with Midcap, a trusted lender within the healthcare industry, to secure minimally dilutive financing in order to support the growth of our business in Canada," said Scott Langille, Stellar's Chief Financial Officer. "Based on our ambitious plans for growth, both organically and though business development initiatives, we feel it is important to secure a long-term relationship with a financial partner that understands our business and our market."

"We've been impressed with Stellar's ability to build a quality specialty pharmaceutical business in Canada and look forward to continued growth in the years to come, both organically and through new product opportunities," commented Chris York, Co-Head of Life Sciences at MidCap Financial.

Bloom Burton & Co. of Toronto, Ontario, Canada, acted as Stellar's agent.

About Stellar Pharmaceuticals Inc.

Stellar and its subsidiary, Tribute Pharmaceuticals, is an emerging Canadian specialty pharmaceutical company focused on the acquisition, licensing, development and management of pharmaceutical and healthcare products with its primary focus on the Canadian market.

Stellar markets Bezalip® SR (bezafibrate), Soriatane® (acitretin), NeoVisc® (1.0% sodium hyaluronate solution) and Uracyst® (sodium chondroitin sulfate solution 2%) in the Canadian market. Additionally, NeoVisc® and Uracyst® are commercially available and are sold globally through various international partnerships. Stellar is currently in negotiations to license both NeoVisc® and Uracyst® in the United States and other international markets. The Company has recently received approval by Health Canada for the sale and distribution of Cambia® in Canada and expects to launch the product in the second half of the year.

About MidCap Financial

MidCap Financial is a commercial finance company focused on middle market lending across the healthcare sector. MidCap specializes in $5 million to $200 million loans and since launching in 2008 has deployed over $1 billion in capital. The company is headquartered in Bethesda, MD, with offices in Chicago and Los Angeles. For more information, please visit www.midcapfinancial.com.

Forward-Looking Statements

This press release contains certain forward-looking statements about Stellar Pharma as defined in the Private Securities Litigation Reform Act of 1995, which statements can be identified by the use of forward-looking terminology, such as "may", "will", "expect", "intend", "anticipate", "estimate", "predict", "plan" or "continue" or the negative thereof or other variations thereon or comparable terminology referring to future events or results. Forward-looking statements, by their nature, are subject to risks and uncertainties. Stellar's actual results could differ materially from those anticipated in these forward-looking statements as a result of numerous factors, including general economic conditions, the ability of Stellar to successfully integrate operations, and the timing of expenditures and expansion opportunities, any of which could cause actual results to vary materially from current results or anticipated future results. See Stellar's reports filed with the Canadian Securities Regulatory Authorities under its issuer profile at www.sedar.com and the U.S. Securities and Exchange Commission from time to time for cautionary statements identifying important factors with respect to such forward- looking statements, including certain risks and uncertainties that could cause actual results to differ materially from results referred to in forward-looking statements. Stellar assumes no obligation to update the information contained in this press release to update forward-looking statements to reflect changed assumptions, the occurrence of anticipated events or changes in future operating results, financial condition or business over time.

Contacts:
Stellar Pharmaceuticals Inc.
Scott Langille
CFO
519-434-1540
scott.langille@stellarpharma.com

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