Release issued 15th January 2005

LAKE PARK, FLORIDA - TransDermal Technologies, Inc. President Kenneth Kirby announced today that TransDermal's research collaborators at the William Harvey Institute presented the results of the company's recently completed trial of Testosterone TDS® to the Winter Meeting of the British Pharmacological Society. The presentation will be documented in the proceedings of the meeting and a peer- reviewed publication will follow early this year.

The research concluded that the TDS®-Testosterone preparation can deliver testosterone systemically in humans and the concentrations of hormone in the first 12 hours following TDS® administration are bio-equivalent to an already marketed topical delivery gel. Compared to the gel formulation the TDS® preparation provides a more convenient mode of application and results in less contamination of patients' hands and clothing.

Dr. Shern Chew, Professor of Endocrinology at Queen Mary and St. Bartholomew's Medical College, who was the clinical overseer of the trial, has indicated that the data is significant and certainly warrants progressing to trials in patients with significantly low testosterone levels as soon as possible and is working with the company to organize these trials as early in 2005 as possible, hopefully in the first quarter.

THE BIGGER PICTURE

TransDermal's President Kirby stated that the TransDermal team is particularly pleased that the British Pharmacological Society has recognized the work that has been done to independently establish TDS® as a truly unique drug delivery modality. The new TDS® spray-on liquid transdermal delivery system stands alone in its demonstrated ability to rapidly, safely and conveniently deliver a therapeutic dose of compounds as large as a peptide of nearly 1,700 Daltons. "So far as we know no other transdermal delivery system has been able to duplicate the record that TDS® has established in its clinical trials in the last three years. TDS® stands alone in the size of molecules delivered, the size of the dose that can be delivered with a single application, its broad applicability and speed of development," Kirby reports.

A BREAK THROUGH THE SKIN

TransDermal believes it may have the first broadly applicable major advance in through-the-skin drug delivery in over 30 years. Transdermal patches were first introduced in the 1970's and offered great promise for safer and more effective drug delivery, but over the intervening years the promise has faded as the limits of the technology were quickly reached. Only seven drugs have ever been successfully commercialized using a patch and of those seven, several were only marginally effective. The TDS® system has consistently surpassed every other competitive transdermal delivery modality in clinical trials and offers substantial convenience and safety enhancements over patches, gels, oral and injectible dosing while matching their ability to achieve therapeutic blood levels. Rapidly absorbed and rapidly available, medicines formulated into a TDS® system are typically sprayed on with a mist sprayer or applied with an applicator and then rubbed into the skin. The TDS® can be designed to provide a systemic absorption for drugs like antihistamines, hormones or Statin drugs, or modified to localize a pain reliever, an antibiotic or a breast cancer drug to where it's applied. But most exciting is the fact that because TDS® by-passes the stomach and gut and liver, smaller, safer doses can accomplish therapeutic outcomes with fewer interactions and side effects and provide greater flexibility in how much drug is needed to optimize treatment of a medical condition.

GROWING SCIENTIFIC PEDIGREE

The research team at the William Harvey Institute has been quietly and methodically amassing substantial proof-of- principle data for TDS® applications of broadly divergent compounds including anti-inflammatory drugs, anaesthetics, hormones and anti-virals. They have completed over 14 trials of 12 different compounds delivered across intact skin with the TDS® system including 3 human clinical trials, all of which were successful. The company believes the promise of a safe and simple system that delivers all sorts of drugs across intact skin painlessly, quickly and conveniently is being fulfilled with TDS®. During the various pre-clinical and clinical trials completed there have multiple hundreds of monitored exposures to TDS® and there has never been an adverse event or skin irritation reported or documented.

To date, TransDermal Technologies has been focused on applying the TDS® technology to existing drugs to create solutions for patients with distinct advantages over existing therapies. "We have maintained a low profile while we have probed the limits and established the safety of this new approach to drug delivery," Kirby says. The results have been very encouraging. TransDermal, through collaborations, expects to start three clinical trials including a peptide drug this year, in addition to additional work on Testosterone TDS® which Professor Chew is encouraging.

ON THE CREST OF THE TECHNOLOGY WAVE

"We are particularly excited about our recent results with the TDS® formulation for Testosterone, a drug much in the news recently," says Kirby.

Up until the introduction of Testosterone patches and gel preparations, patients with clinically low levels of testosterone were constrained to receiving an injection on a regular basis. Several companies developed and market patches but because the solvent systems in patches have to be a little more aggressive, these products tend to cause rash reactions in a substantial number of patients and the outcomes, while better than nothing, often are not quite where the physician would like them to be. Gel systems represent a major advance in their ability to deliver a strong therapeutic dose and generally are much less irritating but they absorb very slowly over several hours and the preparation must be applied to a fairly large area. Due to the slow absorption of the testosterone gels, the U.S. F.D.A. requires warnings about inadvertent transmission of the drug to others.

THE NEXT STEP IN DRUG DELIVERY

TTI believes that the TDS® delivery technology is the next logical step. By eliminating the patch and its plastic polymer backing and reservoir ingredients, the types and characteristics of the solvent systems is dramatically changed expanding the number and types of drugs deliverable and the irritation potential nearly completely eliminated. Novel formulation technique enables delivering the drug rapidly and efficiently through the skin minimizing irritation rather than slow, first order kinetic flux created with gels. In the recently-competed testosterone TDS® trial, at one half-hour after dosing the TDS® had increased the level of hormone dramatically, compared to the gel system which had no effect at 30 minutes. In a previous clinical trial of a Lidocaine TDS® system, anaesthetic effect was noted in 5 minutes - about the minimum time required for onset of efficacy with the injected form of the drug. But most significantly, TDS® enables doses of hormones to be titrated, or micro-adjusted to optimize a dose and mitigate the potential side effects that clinicians and patients are concerned with.

"TDS® has been documented to be safe, completely absorbed within just a few minutes, delivering a bio-available dose of several different types of drug rapidly into the circulation," Kirby reports. We hope that companies struggling with the challenges of safe and effective dose formulations, brand differentiation or franchise extension will consider TDS® as a viable, extremely cost-effective option for their solutions."

TRANSDERMAL ACTIVELY SEEKING PARTNERS

"We are actively seeking pharmaceutical companies who want to partner with TransDermal to develop TDS® applications that will enhance their product offerings," Kirby states. "There are a number of opportunities, including the testosterone and Lidocaine applications, that we believe are well advanced and ready to license."

Company Contact: Kenneth B. Kirby / K.Kirby@Transdermaltechnologies.com 001-561-848-9100 / 800-282-5511

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