Release issued 11th October 2001

PATTERSON, NY, October 11, 2001 - Penwest Pharmaceuticals Co. (NASDAQ: PPCO) today announced that Nifedipine XL, which it has licensed to Merck, SA. Industrias Quimicas, has been approved by regulatory authorities in Brazil for marketing there in 30 mg and 60 mg dosage forms. The companies expect that Merck will begin commercialization of the drug under the brand name CRONODIPIN in early 2002.

Nifedipine XL is a controlled release version of nifedipine using Penwest's TIMERx® oral drug delivery technology. The product is indicated for the treatment of hypertension and angina.

Tod R. Hamachek, Chairman and Chief Executive Office of Penwest, said, "We are pleased by the international acceptance of our technology and of Nifedipine XL. This is our first entrance into the South American market. Nifedipine products are marketed in Europe through our collaboration with Sanofi-Sythelablo, and are being registered in Israel through a separate licensing agreement. In addition, Penwest and Mylan Pharmaceuticals jointly developed a 30 mg version of Nifedipine XL, a generic version of Procardia XL®, which received U.S. regulatory approval. The internationalization of our product portfolio is an important part of our strategy and we will continue to pursue opportunities for Nifedipine XL."

Merck, SA. Industrias Quimicas is a subsidiary of Merck KGaA, a pharmaceutical, laboratory and specialty chemicals company headquartered in Darmstadt, Germany with annual sales of Euro 6.9 billion and operating in 52 countries with 33,000 employees worldwide.

Penwest is engaged in the research, development and commercialization of novel drug delivery technologies. Based on its experience in developing and manufacturing ingredients for orally-administered pharmaceutical products, Penwest has developed its proprietary TIMERx® controlled release delivery technology, which can be applied to a broad range of drugs.

The matters discussed herein contain forward-looking statements that involve risks and uncertainties, which may cause Penwest's actual results in future periods to be materially different from any future performance suggested herein. For this purpose, any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, the words, "believes," "anticipates," "plans," "expects,"" intend," "potential" and similar expressions are intended to identify forward-looking statements. Such risks and uncertainties include e the need for the Company to raise capital in order to fund increasing R&D spending and the risk that Penwest will not be able to raise such funds or will only be able to raise such funds on unfavorable terms; dependence on collaborators to, among other things, sell products for which the Company receives royalties and advance clinical development and commercialization of products: the ability to enter into additional collaborations; uncertainty of success of collaborations; the risk of patent litigation; regulatory risks relating to TIMERx® drugs in development; the timing of clinical trials; actual and potential competition; the timing and outcome of regulatory approval of products and other risks as set forth under the caption "Risk Factors" in Penwest's Current Report on Form 8-K filed with the Securities and Exchange Commission on July 25, 2001, and which risk factors are incorporated herein by reference.

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