MONTREAL
— Labopharm Inc. is reviewing its assets for a potential sale or merger as part
of the company’s ongoing restructuring efforts.

The Laval,
Que.-based drug developer said Friday that it believes it has the potential to
sell the rights to its painkiller called Intellitab as well as the time-release
drug technology called polymeric nano-delivery.

The company also plans to look at combining its businesses
to create shareholder value, though it has no assurance that either plan will
result in a transaction.

The decision comes as Labopharm talks to Gruppo Angelini,
its U.S.
partner for the antidepressant Oleptro, with the goal of reworking the terms of
their agreement.

“Although we continue to believe that Oleptro is a
valuable product for the treatment of depression, we feel it is in the
company’s best interest to come to an agreement with Angelini that allows us to
preserve our cash,” said president and CEO Mark D’Souza in a release.

It did not provide any further details on the discussions.

In March, Labopharm announced it was eliminating 38
positions, or nearly 30 per cent of its current workforce with the goal of
saving $3.8 million per year.

Labopharm has been trying to stop its mounting financial
losses. For the 2010 financial year, it lost $28.9 million with $29.4 million
of revenue from all sources. In 2009, it lost $26.1 million with $24.6 million
of revenue.