PGN Pgnx Capital Corporation

Paragon Pharmacies Limited ("Paragon" or "the Company") (TSX VENTURE:PGN) today
reported its financial results for the third quarter ended May 31, 2012. 


"The commitment and focus from the entire Paragon team has continued to bring a
significant improvement in the operating results for the Company. Prior to
transaction costs, EBITDA for the first nine months of the fiscal year was up
56.0% from the previous year. We anticipate that the strong EBITDA performance
prior to transaction costs will continue through to the completion of the sale
of the Company's assets to Shoppers Drug Mart." said R. Gordon Gooding, Chief
Executive Officer.


Revenue for the three month period was $19.261 million compared to $18.835
million in the same period last year. Comparable store pharmacy revenue was
impacted by reductions in generic drug prices due to regulatory reform in
British Columbia and the shift of additional molecules from brand to the lower
priced generic alternatives. These impacts were slightly offset by the second
consecutive quarter of positive trends in prescription growth over the same
period last year. Front store revenue, excluding post office and other revenue,
increased by 5.3% with a continued focus on strengthening the Company's
merchandising and promotional offerings.


Gross profit for the three month period was $8.060 million compared to $7.379
million in the same period last year, an increase of $0.681 million or 9.2%.
Pharmacy margins as a percentage of revenue increased 4.2% over the same quarter
last year as a result of new supply and purchase agreements with certain
suppliers. Front store margins as a percentage of revenue decreased 1.3% in the
third quarter compared to the same period last year as a result of changes in
product mix.


EBITDA before transaction costs was $1.169 million for the three months ended
May 31, 2012 compared to $0.428 million in the same period last year, an
increase of $0.741 million or 173.1%. The increase in EBITDA is due to higher
pharmacy gross profit and the execution of operating cost containment
initiatives.


The net loss for the third quarter, before transaction costs was $0.156 million
compared to $1.140 million in the same period last year, a decrease in the net
loss of $0.984 million or 86.3%.


The pharmacy industry continues to face ongoing regulatory change which will
alter the way generic drugs are priced. The Company's assessment of these
changes is more fully described in Management's Discussion & Analysis for the
third quarter ended May 31, 2012 in the section entitled Regulatory Changes That
Impact the Company's Industry.


The Company's unaudited condensed consolidated financial statements and
Management's Discussion and Analysis for the three and nine month periods ended
May 31, 2012 are available at the Investor Relations section of Paragon's
website at www.helloparagon.com or under the Company's profile on SEDAR at
www.sedar.com.


Paragon Pharmacies Limited is building a pharmacy with our customers in mind.
Headquartered in Kelowna, BC and employing over 400 staff, Paragon currently
owns and operates 19 retail pharmacies and three central fill pharmacies
throughout British Columbia, Alberta and Manitoba. Paragon is a leading
mid-market pharmacy, providing premier pharmacy services in a friendly,
community-focused environment.


FORWARD LOOKING STATEMENTS

This press release contains forward-looking statements regarding, among other
things, the Company's beliefs, plans, objectives, strategies, estimates,
intentions and expectations, including as they relate to its operating and
financial results, capital expenditures and the ability to execute on its
operating, investing and financing strategies. Consequently, actual results and
events may differ materially from those included in, contemplated or implied by
such forward looking statements for a variety of reasons. Forward-looking
statements are subject to inherent risks and uncertainties including, but not
limited to, market and general economic conditions, certain property and
casualty risks, the ability to attract and retain pharmacists, the availability
and terms of financing, changes in the Company's relationship with its key
suppliers, competitive factors, changes in regulatory environments affecting the
Company's business, and the accuracy in management's assumptions (see "RISKS AND
RISK MANAGEMENT" as noted in the Company's Management's Discussion & Analysis
posted on SEDAR at www.sedar.com). This list is not exhaustive of the factors
that may affect any of the Company's forward-looking statements. Investors and
others should carefully consider these and other factors and not place undue
reliance on these forward-looking statements. In addition, these forward-looking
statements relate to the date on which they were made and the Company disclaims
and has no intention or obligation to update or revise any forward-looking
statement, whether as a result of new information, future events or otherwise.

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