Caraco Pharmaceutical Laboratories, Ltd. Enters Into Asset Purchase Agreement with...

Caraco Pharmaceutical Laboratories, Ltd. Enters Into Asset Purchase Agreement
with Forest Laboratories, Inc. to Settle Lexapro(R) (escitalopram oxalate)
ANDA Patent Litigation

DETROIT, July 10 /PRNewswire-FirstCall/ -- Caraco Pharmaceutical Laboratories,
Ltd. (NYSE Amex: CPD) announced that, as part of the settlement of the legal
proceedings related to Lexapro(R) (escitalopram oxalate) tablets, it entered
into an Asset Purchase Agreement with Forest Laboratories, Inc. ("Forest") to
acquire several products from Forest's Inwood line of business. The ANDA
patent litigation settlement resolves litigation involving Caraco, Forest,
Forest Holdings, Ltd., and H. Lundbeck A/S and Sun Pharmaceutical Industries
Limited ("Sun"). Caraco is a subsidiary of Sun.

Among other things, with respect to Caraco, the litigation settlement involves
the following provisions:

1. Forest has agreed to provide licenses to Caraco for any patents related to
Lexapro(R) with respect to the marketing of Caraco's generic version of the
product as of the date that any third party generic enters the market with
final approval from the FDA other than an authorized generic or the first
filer with Hatch-Waxman related exclusivity.

2. Forest will reimburse Caraco for a portion of its attorney's fees related
to this litigation.

3. Pursuant to the Asset Purchase Agreement (the "APA"), Caraco will take
over the commercialization and sale of several products from Forest's Inwood
business. Caraco will pay Forest an advance against royalties and royalties
on net sales of these products.

The terms of the settlement will be submitted to the Federal Trade Commission
and the Department of Justice pursuant to the Medicare Modernization Act. The
APA is scheduled to close no sooner than 40 days after the signing, which the
parties hope will provide the FTC and DOJ with sufficient time to review the
transaction. As the transaction must be submitted to the FTC and DOJ, there
is a possibility that the transaction may need to either be revised, or it may
not be consummated, and the litigation would be re-instituted.

Detroit-based Caraco Pharmaceutical Laboratories, Ltd., develops,
manufactures, markets and distributes generic and private-label
pharmaceuticals to the nation's largest wholesalers, distributors, drugstore
chains and managed care providers.

Safe Harbor: This news release contains forward-looking statements made
pursuant to the safe-harbor provisions of the Private Securities Litigation
Reform Act of 1995. Such statements are based on management's current
expectations and are subject to risks and uncertainties that could cause
actual results to differ materially from those described in the
forward-looking statements. These risks and uncertainties are contained in the
Corporation's filings with the Securities and Exchange Commission and include,
but are not limited to: information of a preliminary nature that may be
subject to adjustment, potentially not obtaining or delay in obtaining FDA
approval for new products, governmental restrictions on the sale of certain
products, development by competitors of new or superior products or less
expensive products or new technology for the production of products, the entry
into the market of new competitors, market and customer acceptance and demand
for new pharmaceutical products, availability of raw materials, timing and
success of product development and launches, dependence on a few products
generating a majority of sales, product liability claims for which the Company
may be inadequately insured, and other risks identified in this report and
from time to time in our periodic reports and registration statements. These
forward-looking statements represent our judgment as of the date of this
report. We disclaim, however, any intent or obligation to update our
forward-looking statements.

SOURCE Caraco Pharmaceutical Laboratories, Ltd.

Daniel Movens, +1-313-871-8400, or Thomas Versosky, +1-313-556-4150, both of
Caraco Pharmaceutical