Release issued 25th October 2001

PATTERSON, NY, OCTOBER 25, 2001 - Penwest Pharmaceuticals Co. (NASDAQ: PPCO) today announced the successful completion of a clinical trial on the oxymorphone extended release product it is jointly developing with Endo Pharmaceuticals Inc., a wholly owned subsidiary of Endo Pharmaceuticals Holdings Inc. (NASDAQ: ENDP; ENDPW). The product is being developed for twice-a-day dosing in patients suffering from moderate to severe pain.

The randomized, double-blind, placebo-controlled trial was conducted in 127 patients who were suffering from moderate to severe pain following arthroplasty surgery in the knee. Measurements of analgesic relief were recorded over a 12- hour period following dosing with either oxymorphone ER or placebo.

The results demonstrate that the patients taking oxymorphone extended release, formulated with Penwest's TIMERx® delivery technology, demonstrated statistically superior pain relief compared to patients received only a placebo (p = 0.0057). The safety profile of oxymorphone in this clinical trial was consistent with the safety profile found in the opioid class of drugs.

Tod R. Hamachek, Chairman and Chief Executive Officer of Penwest, said, "Trials of the oxymorphone product we are developing with Endo continue to show successful results, consistent with our expectations. We are very excited about this product and value our strong collaboration with Endo. We are on track for an NDA submission for this product with the Food and Drug Administration in the second half of 2002."

Penwest and Endo began developing extended release oxymorphone in early 1998, and previously released positive results on a Phase III trial in osteoarthritis pain. Penwest is also developing other non-opioid pain products through its collaboration with Arakis Ltd. for a chronotherapeutic version of a product indicated for the treatment of rheumatoid arthritis and with Sanofi/Synthelabo for a controlled release pain product for use in Europe.

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 TIMER® 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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