Trading and Product Update

Alliance Pharma PLC
15 January 2007



For immediate release                                            15 January 2007



                              ALLIANCE PHARMA PLC
                      ('Alliance Pharma' or 'the Company')

                     Trading and Product Development Update


Alliance Pharma plc (AIM: APH), the emerging speciality pharmaceutical company,
announces that its sales for the 12 months to 31st December 2006 were £17.3m,
an increase of 19.7% over the 12 months to December 2005. Like for like growth
was 7.7% with the additional growth derived from brands acquired in the period.
As anticipated at the time of the Interim Results, profitability has been
restored to a satisfactory level.


Preliminary results are now available from the pilot phases, in shiftworkers and
elderly patients, of the Phase III trials of Posidorm, the Company's melatonin
product for sleep disorders.  These results indicate a significant improvement
in sleep duration compared with placebo when using the objective measure of
actigraphy, a sleep-measuring device. Additionally in the shiftworker group,
performance measurements during the night showed improvements for trial
participants on Posidorm.  In both groups, Posidorm was well tolerated, there
being no difference in the incidence of reported side-effects compared with
placebo.


Whilst the pilot trials have been successful, the Company has been advised by
the European Medicines Agency (also known as EMEA) that additional safety and
dose confirmation studies will be required. The original plan for Posidorm's
development was based on discussions with the UK Medicines and Healthcare
products Regulatory Agency (MHRA), which took into account the extensive medical
and scientific literature on melatonin.  That plan envisaged UK registration
first, followed by registration in other European countries. The pan-European
registration routes that now have to be followed take less account of the
accumulated knowledge about melatonin.  The effect of this change in regulatory
approach will delay the anticipated completion of development from Q4 07 to Q4
09 and will involve extra cost, currently estimated to be in the range of £4m to
£6m.


Market research studies have shown there is a clear need for new products for
sleep disorders that avoid the problems of habituation and next day 'hangovers'.
The potential European sales for such products have been estimated to be in the
range of £100m - £200m, with the market projected to develop significantly on
the entry of new products.


The major Phase III efficacy trials of the Company's other development project,
Isprelor, misoprostol for the induction of labour, are close to completion.


John Dawson, Alliance Pharma's Chief Executive, said: 'I am delighted by the
near 20% growth in full year sales and the Company's profitable performance.
While the additional guidance on Posidorm from the EMEA involves further time
and cost, it does give a clear pathway through the registration process and
allows an optimised pan-European product launch. We are currently looking at
various options, including co-development, for bringing Posidorm to market in
the quickest possible time.'


Preliminary results for the 12 month period to 31 December 2006 will be
announced on 22 March 2007.



For further information:

Alliance Pharma plc                                         + 44 (0) 1249 466966
John Dawson, Chief Executive
Maddy Scott, Finance Director
www.alliancepharma.co.uk

Buchanan Communications                                    + 44 (0) 20 7466 5000
Mark Court/Lisa Baderoon/Rebecca Dietrich


Notes to editors

About Alliance Pharma

Alliance Pharma, founded in 1996, is an AIM listed emerging speciality
pharmaceutical company based in Chippenham, Wiltshire, UK. The company has a
strong track record of acquiring the rights to established niche brands and
owns, or shares, the rights to 34 branded pharmaceutical products and continues
to explore opportunities to expand the range.

Alliance Pharma's products are prescribed in the treatment of a wide range of
conditions and include brands used in periodontitis (a serious gum disease), the
prevention of heart disease, in Parkinson's disease, in nutrition, in nasal
infections, in the treatment of dermatological conditions and in childbirth.
Alliance Pharma's sales are mainly prescription driven.  Its products are
distributed to hospitals directly and to pharmaceutical wholesalers which
service both hospital and retail pharmacies with their prescription
requirements.

Alliance Pharma is also developing novel products for sleep disorders and the
induction of labour.

Alliance Pharma joined the AIM market of the London Stock Exchange in December
2003 and trades under the symbol APH.



                      This information is provided by RNS
            The company news service from the London Stock Exchange