Taro Receives Tentative Approval for Terbinafine HCl Cream 1% ANDA; Generic Equivalent to Lamisil(R) Cream.

HAWTHORNE, N.Y. -- Taro Pharmaceutical Industries Ltd. ("Taro," NASDAQ: TARO) reported today that its U.S. affiliate has received tentative approval from the U.S. Food and Drug Administration ("FDA") for its Abbreviated New Drug Application ("ANDA") for Terbinafine Hydrochloride Cream 1% ("terbinafine cream").

The FDA has determined that Taro's terbinafine cream is safe and effective for use when compared with the reference listed drug product, Lamisil(R) Cream of Novartis Consumer Health Inc. Terbinafine cream is an over-the-counter antifungal product which cures most athlete's foot, jock itch and ringworm, and relieves the itching, cracking, burning and scaling which accompany these conditions. According to industry sources, Lamisil(R) Cream has annual U.S. sales in excess of $45 million.

The tentative ANDA approval for terbinafine cream, which Taro believes is the first received by a company in the U.S., is an FDA determination that Taro's ANDA submission for this product currently satisfies the substantive requirements for approval, subject to the expiration of all relevant patents or statutorily imposed exclusivities, restrictions and any new information that may come to the FDA's attention. Tentative approvals do not grant marketing rights; a company may only market a product upon receiving final approval for an ANDA submission. The listed patent on Lamisil(R) Cream expires on December 30, 2006.

Taro Pharmaceutical Industries Ltd. is a multinational, science-based pharmaceutical company, dedicated to meeting the needs of its customers through the discovery, development, manufacturing and marketing of the highest quality healthcare products.

For further information on Taro Pharmaceutical Industries Ltd., please visit the Company's website at www.taro.com.

Certain statements in this release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding the Company's terbinafine cream product. Although Taro Pharmaceutical Industries Ltd. believes the expectations reflected in such forward-looking statements to be based on reasonable assumptions, it can give no assurance that its expectations will be attained. Factors that could cause actual results to differ include industry and market conditions; slower than anticipated penetration of new markets; physician, pharmacist or consumer acceptance of the new Taro products; changes in the Company's financial position; regulatory actions; and, other risks detailed from time to time in the Company's SEC reports, including its Annual Reports on Form 20-F. Forward-looking statements speak only as of the date on which they are made. The Company undertakes no obligation to update, change or revise any forward-looking statements, whether as a result of new information, additional or subsequent developments or otherwise.