Complaint regarding Dragon Pharma's proposed merger with Datong Investment filed

Dragon Pharmaceutical Inc. ("Dragon Pharma" or the "Company" TSX: DDD; OTCBB: DRUG) announced today that a complaint regarding its proposed merger with Datong Investment Inc was filed in the Circuit Court of the Fifteenth Judicial Circuit for Palm Beach County, State of Florida, against the Company, and its eight directors. Mr. Yanlin Han, a director and Chief Executive Officer of the Company and its largest stockholder, was also named as defendant in the lawsuit, along with Datong Investment Inc. which is a company controlled by Mr. Han.

The action was brought by Mr. Kwok-Bun Ho, an alleged stockholder, on behalf of himself and all others similarly situated, and relates to the proposed merger contemplated by the Agreement and Plan of Merger dated March 26, 2010, by and among, the Company, Chief Respect Limited, Datong Investment Inc., and Mr. Han (the "Agreement"). The complaint alleges, among other things, that the directors of the Company breached their fiduciary duties to stockholders in connection with the proposed merger; that the merger consideration of $0.82 per share is inadequate; and that certain terms of the Agreement relating to the non-solicitation provision and termination fee unfairly benefit Mr. Han at the expense of the other stockholders.

The complaint seeks, among other things, injunctive relief to enjoin the Company and directors from consummating the proposed merger, along with legal costs, including attorneys' and experts' fees. The Company and its directors believe that the allegations in the complaint are without merit and intend to vigorously defend against the claims and causes of action asserted in this legal matter.