FOR IMMEDIATE RELEASE                  Contact: Warren P. Levy, Ph.D., President
                                                Unigene Laboratories, Inc.      
                                                973/882-0860     

                                                Thomas Redington                
                                                203/222-7399     
                                                212/926-1733     

                  UNIGENE AND WARNER-LAMBERT FINALIZE AGREEMENT
                    TO DEVELOP NEW TREATMENT FOR OSTEOPOROSIS


         Fairfield,   NJ,   July  16,   1997  --  Unigene   Laboratories,   Inc.
(Nasdaq:UGNE)  said it  finalized  a  worldwide  licensing  agreement  for  oral
calcitonin with the Parke-Davis division of Warner-Lambert Company in accordance
with the terms of a previously  announced letter of intent.  Unigene is eligible
to receive  up-front and  milestone  payments  totaling in excess of $50 million
during the development phase of the project,  as well as royalties on commercial
sales. Warner-Lambert will also purchase an undisclosed amount of Unigene common
stock.

         As part of the  agreement,  Warner-Lambert  will develop and market the
product and Unigene  will  exclusively  supply the bulk  calcitonin  and provide
analytical support services.

         "This  landmark  agreement  confirms  the  suitability  of our two core
technologies for manufacturing and orally delivering  calcitonin," commented Dr.
Warren Levy,  President of Unigene.  "Calcitonin  is the first of many naturally
occurring  amidated  peptides with  potential  medical value that we hope can be
commercially developed with our processes."

         "We look forward to this  partnership  with  Unigene," said Ronda Dean,
vice president,  Parke-Davis/Women's Healthcare Division. "The agreement on this
important therapy continues our commitment to providing  healthcare solutions to
women throughout their lives."

         Calcitonin  is  a  leading   treatment  for  osteoporosis  with  annual
worldwide  sales  of  more  than  $700  million.  Currently  available  only  in
injectable and nasal forms, it is the only marketed osteoporosis  treatment with
pain  relieving   properties   and  it  has  no  significant   side  effects  or
contraindications. Consequently, Unigene and Warner-Lambert believe that an oral
form of calcitonin will enjoy  significant  advantages  over other  osteoporosis
treatments.

         Unigene Laboratories,  Inc. has developed two proprietary  technologies
for  manufacturing  amidated  peptide  hormones and delivering them orally.  The
Company is currently  producing  FORTICAL(R)  (recombinant salmon calcitonin) in
compliance  with  the  FDA's  Good  Manufacturing  Practice  guidelines  at  its
manufacturing facility in Boonton, N.J.


         Parke-Davis,  a  division  of  Warner-Lambert  Company,  is  devoted to
discovering,  developing,  manufacturing  and marketing  quality  pharmaceutical
products.   Its  central   research  focus  is  on  heart   disease,   diabetes,
anti-infectives,  central nervous system, and women's healthcare. Warner-Lambert
is a worldwide company  employing  approximately  40,000 people,  and along with
Parke-Davis is headquartered in Morris Plains, N.J.

         Except for  historical  information,  the  statements  made  herein are
forward looking statements  involving risks and  uncertainties.  These risks and
uncertainties,  including those relating to the timing or successful  completion
of the  Company's  product  commercialization  activities,  are  detailed in the
Company's filings with the Securities and Exchange Commission.
                  
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