Mr. Sylvain Chretien reports

PEDIAPHARM ARRANGES PRIVATE PLACEMENT OF UNITS FOR $5,000,000

Pediapharm Inc. has agreed to a non-brokered private placement of 14,705,883 units of the company at a price of 34 cents per unit, for gross proceeds of $5-million, all of which shall be subscribed for by 9346-4626 Quebec Inc., a private company operating as Transican owned by Gerard Leduc, a globally known pharmaceutical executive. Each unit comprises one common share in the capital of the company and one-half of one common share purchase warrant of the company. Each warrant entitles the holder thereof to purchase one common share at a price of 51 cents per share expiring 36 months from the date of issuance. No commissions or fees, other than legal and filing fees, are payable in connection with this financing.

The net proceeds of this offering will be used to secure new business opportunities as well as to accelerate the growth of the company's recently launched products, namely Rupall and Otixal.

The closing of the offering is expected to occur on or about May 23, 2017. Completion of the offering is subject to a number of conditions, including, without limitation, receipt of all regulatory approvals, including approval of the TSX Venture Exchange.

About Pediapharm Inc.

Pediapharm is the only Canadian specialty pharmaceutical company dedicated to serving the needs of the pediatric community. The company's innovative product portfolio includes NYDA, a breakthrough treatment for head lice; EpiCeram, a non-steroid emulsion for eczema; naproxen suspension, indicated to treat pain and inflammation due to various conditions, including juvenile idiopathic arthritis; Rupall, an innovative new allergy medication with a unique mode of action; Otixal, the first and only antibiotic and steroid combination ear drop available in single, sterile, preservative-free and unit-dose packaging; and Cuvposa, for severe drooling, which is under review with Health Canada.

We seek Safe Harbor.