Basel, Switzerland, July 31, 2008 - Basilea Pharmaceutica Ltd.announces that Toctino® (alitretinoin), a new oral therapy for severerefractory Chronic Hand Eczema (CHE), was recommended for regulatoryapproval under the European decentralized procedure and will becomethe first authorized treatment for this chronic disabling disease.

The concerned EU Member States concluded that the profile of Toctino®(alitretinoin) is favorable for the use in adults who suffer fromsevere CHE that is unresponsive to treatment with potent topicalcorticosteroids. The recommendation for approval is the final stepbefore national marketing licenses are granted.

Subject to approval by the individual EU Member States alitretinoinis expected be marketed under the trade name Toctino®.

Dr. Anthony Man, CEO of Basilea said, "We are absolutely delighted toreceive an approval recommendation from the eleven EU Member Statesthat were included in the procedure. Subject to national approval wewill offer the first authorized oral treatment for patients sufferingfrom severe Chronic Hand Eczema who do not respond to potent steroidtherapy. Chronic Hand Eczema is a disease that heavily burdenspatients' professional life and psychological well-being. This isalso a great moment in the history of our company as we startlaunching Toctino® in the European market."

Marketing applications for the use of alitretinoin in the treatmentof severe chronic refractory hand eczema are also under regulatoryreview in Canada and in Switzerland.

About Chronic Hand Eczema

Hand eczema is a common inflammatory skin disease and is oftenchronic and relapsing. It is one of the most common occupational skindiseases and a frequent reason for patients to consult adermatologist. Hand eczema is reported to affect up to ten percent ofthe general population. The more severe, chronic form of thecondition is thought to affect up to seven percent of these patients,many of whom do not respond, or no longer respond to potent topicalsteroids. CHE causes significant economic burden with direct medicalcosts alone in Europe estimated to eleven billion Euro per year. Themost important patient burden is impaired use of the hands and thesocial discrimination (stigma) associated with CHE. Being localizedin a highly visible area, CHE can cause major psychosocial problemssuch as low self-esteem and social phobia and has a considerableimpact on patients' quality of life.

About Toctino® (alitretinoin)

Toctino® (alitretinoin) was developed by Basilea PharmaceuticaInternational Ltd. Marketing authorization for alitretinoin isrecommended for usage in adults who suffer from severe CHE that isunresponsive to treatment with potent topical corticosteroids.Patients whose CHE is predominantly characterized by fissured, thickscaly skin are more likely to respond than those in whom the eczemais mainly characterized by blisters that itch and burn.Alitretinoin as convenient single daily capsule to be taken with foodis highly effective. The general recommended starting dose is 30 mgand a treatment course lasts for 12 to 24 weeks depending onresponse.Alitretinoin is a derivative of vitamin A and belongs to the wellstudied family of retinoids. All retinoids are teratogens. Thereforepregnancy is a contraindication to alitretinoin therapy and strictpregnancy prevention measures must be in place for all women ofchild-bearing potential who receive alitretinoin. Within days afterdiscontinuation of therapy, alitretinoin levels return to endogenouslevels. A state-of-the-art pregnancy prevention program has beendeveloped and will be implemented in the individual EU member statesat launch. In clinical trials alitretinoin was generally welltolerated and has a safety profile overall consistent with theretinoid class. Side effects were dose-dependent and reversible.

Conference call

Basilea Pharmaceutica Ltd. invites you to participate in a conferencecall on July 31, 2008, 4 p.m. (CET), during which the company willdiscuss today's press release.

Dial-in numbers are:+41 (0) 91 610 56 00      (Europe and ROW)+1 (1) 866 291 4166       (USA)+44 (0) 207 107 0611     (UK)The playback will be available 1 hour after the conference call for48 hrs. Participants requesting a digital playback may dial:+41 (0) 91 612 4330       (Europe)+1 (1) 866 416 2558       (USA)+44 (0) 207 108 6233     (UK)and will be asked to enter the ID 17722 followed by the # sign.

About Basilea

Basilea Pharmaceutica Ltd. is headquartered in Basel, Switzerland,and listed on the SWX Swiss Exchange (SWX: BSLN). Basilea's integratedresearch and development operations are currently focused on newantibacterial and antifungal agents to fight drug resistance and onthe development of dermatology drugs. Basilea's products are targetedto satisfy high medical and patient needs in the hospital andspecialty care setting. The company owns a diversified portfolioincluding two drugs under regulatory review (ceftobiprole,alitretinoin) and one phase-III investigational drug (isavuconazole).The company is currently building its sales and marketingorganization to commercialize alitretinoin and to co-promoteceftobiprole in North America and major European countries, subjectto approval.

Disclaimer

This communication expressly or implicitly contains certainforward-looking statements concerning Basilea Pharmaceutica Ltd. andits business. Such statements involve certain known and unknownrisks, uncertainties and other factors, which could cause the actualresults, financial condition, performance or achievements of BasileaPharmaceutica Ltd. to be materially different from any futureresults, performance or achievements expressed or implied by suchforward-looking statements. Basilea Pharmaceutica Ltd. is providingthis communication as of this date and does not undertake to updateany forward-looking statements contained herein as a result of newinformation, future events or otherwise.

For further information, please contact:

+-------------------------------------------------------------------+| Media Relations                  | Investor Relations             ||----------------------------------+--------------------------------|| Jean-Christophe Britt, Ph.D.     | Barbara Zink, Ph.D.            || Corporate Communication & Public | Head Corporate Development     || Relations                        | +41 61 606 1233                || +41 61 606 1354                  | investor_relations@basilea.com || media_relations@basilea.com      |                                |+-------------------------------------------------------------------+

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