# WARRANT CERTIFICATE

THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE ACT), OR UNDER THE SECURITIES LAWS OF ANY STATE. THESE
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO DISTRIBUTION OR
RESALE. SUCH SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, DELIVERED AFTER SALE,
TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
COVERING SUCH SECURITIES UNDER THE ACT, AND ANY OTHER APPLICABLE SECURITIES LAWS, UNLESS
THE HOLDER SHALL HAVE OBTAINED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE
COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.



THE
SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON TRANSFER SET
FORTH IN THE SECURITIES PURCHASE AGREEMENT, DATED AUGUST 18, 2004 BETWEEN THE COMPANY AND
THE REGISTERED OWNER OF SUCH SECURITIES (OR SUCH OWNERS PREDECESSOR IN INTEREST).
THE COMPANY WILL FURNISH A COPY OF SUCH AGREEMENT WITHOUT CHARGE UPON WRITTEN REQUEST OF
THE HOLDER OF THIS CERTIFICATE.

235,225 Warrants

# PALATIN TECHNOLOGIES,
INC.

# COMMON STOCK PURCHASE WARRANT
CERTIFICATE

# THE WARRANTS EVIDENCED
BY THIS CERTIFICATE

# ARE NOT EXERCISABLE
AFTER 5:00 P.M.,

# NEW YORK CITY TIME, ON

# August 18, 2007

THIS
CERTIFIES THAT:

| | KING PHARMACEUTICALS, INC., or its registered assigns, is the registered holder (the
Registered Holder) of the number of Warrants set forth above, each of which
represents the right to purchase from Palatin Technologies, Inc., a Delaware corporation
(the Company), 235,225 fully paid and nonassessable shares of common
stock, par value $0.01 per share (the Common Stock), of the Company,
exercisable on one or
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

| | more occasions, in whole or in part, at the initial exercise price
of $4.25 per Warrant, as adjusted from time to time (the Exercise Price) at
any time prior to the Expiration Date (as hereinafter defined), by surrendering this
Warrant Certificate, with the Form of Election to Purchase duly executed at the principal
office of the Company and by paying in full the Exercise Price, plus transfer taxes, if
any. The term Warrants as used herein shall include this Warrant Certificate,
and any warrants delivered in substitution or exchange therefor as provided herein.
Payment of the Exercise Price shall be made in United States currency, by cash, certified
or official bank check, checks, money order or wire transfer of commercially
available funds payable to the order of the Company.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | This Warrant Certificate is issued under and in accordance with the Securities Purchase
Agreement (the Purchase Agreement), dated as of August 18, 2004, between the
Company and the Registered Holder, and is subject to the terms and provisions contained in
the Purchase Agreement. Article  6 of the Purchase Agreement governs the registration
rights of the shares of Common Stock underlying the Warrants. Unless otherwise defined
herein, the capitalized terms used herein shall have the meaning assigned to such terms in
the Purchase Agreement.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | As soon as practicable after the date of exercise of any Warrants, the Company shall issue,
or cause the transfer agent for the Common Stock, if any, to issue a certificate or
certificates for the number of full shares of Common Stock to which the Registered Holder
is entitled as a result of its exercise of the Warrant, registered in accordance with the
instructions set forth in the Form of Election to Purchase. All shares of Common Stock
issued upon the exercise of any Warrant shall be validly authorized and issued, fully paid
and nonassessable, and free from all taxes, liens and charges created by the Company in
respect of the issue thereof. Each person in whose name any such certificate for shares of
Common Stock is issued shall for all purposes be deemed to have become the holder of
record of the Common Stock represented thereby on the date of exercise of the Warrants
resulting in the issuance of such shares, irrespective of the date of issuance or delivery
of such certificate for shares of Common Stock. As of the date of exercise, the holder of
such shares of Common Stock shall, among other things, be entitled to vote such shares of
Common Stock or to consent or to receive notice as a stockholder of the Company.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In the event that less than all of the Warrants represented by a Warrant Certificate are
exercised, the Company shall execute and mail, by first-class mail, within 30 days of the
date of exercise, to the Registered Holder, or such other person as shall be designated in
the Form of Election to Purchase, a new Warrant Certificate evidencing the right to
purchase the shares of Common Stock representing the unexercised portion of the Warrant
which shall be in all other respects identical to the Warrant Certificate. In no event
shall a fraction of a Warrant be exercised, and the Company shall distribute no Warrant
Certificates representing fractions of Warrants. Final fractions of shares shall be
treated as provided for herein.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Company shall at all times reserve and keep available for issuance upon the exercise of
the Warrants, or a portion thereof, such number of its authorized but unissued shares of
Common Stock as is sufficient to permit the exercise in full of all outstanding Warrants.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | Subject to the provisions hereof, the Exercise Price in effect from time to time shall be subject
to adjustment, as follows:
| | ----------------------------------------------------------------------------------------------------------------------------

| | (a)       
               In case the Company shall at any time after the date hereof (i) declare a
               dividend on the outstanding Common Stock payable in shares of its capital stock,
               (ii) subdivide or convert the outstanding Common Stock, (iii) combine
               the outstanding Common Stock into a smaller number of shares, or (iv) issue
               any shares or otherwise increase or decrease the number of issued shares of its
               capital stock by reclassification of the Common Stock (including any such
               reclassification in connection with a consolidation or merger in which the
               Company is the continuing corporation), then, in each case, the Exercise Price,
               and the number of shares of Common Stock issuable upon exercise of the Warrants
               in effect at the time of the record date for such dividend or of the effective
               date of such subdivision, combination, or reclassification, shall be
               proportionately adjusted so that the Registered Holder of the Warrants after
               such time shall be entitled to receive the aggregate number and kind of shares
               which, if such Warrants had been exercised immediately prior to such time, such
               Registered Holders would have owned upon such exercise and been entitled to
               receive by virtue of such dividend, subdivision, combination or
               reclassification. Such adjustment shall be made successively whenever any event
               listed above shall occur.
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| | (b)       
               In case the Company shall issue or fix a record date for the issuance to all
               holders of Common Stock of rights, options, or warrants to subscribe for or
               purchase Common Stock (or securities convertible into or exchangeable for Common
               Stock) at a price per share (or having a conversion or exchange price per share,
               if a security convertible into or exchangeable for Common Stock) less than the
               Current Market Price per share of Common Stock (as determined below) on such
               record date, then, in each case, the Exercise Price shall be adjusted by
               multiplying the Exercise Price in effect immediately prior to such record date
               by a fraction, the numerator of which shall be the number of shares of Common
               Stock outstanding on such record date plus the number of shares of Common Stock
               which the aggregate offering price of the total number of shares of Common Stock
               so to be offered (or the aggregate initial conversion or exchange price of the
               convertible or exchangeable securities so to be offered) would purchase at such
               Current Market Price and the denominator of which shall be the number of shares
               of Common Stock outstanding on such record date plus the number of additional
               shares of Common Stock so issued or to be offered for subscription or purchase
               (or into which the convertible or exchangeable securities so to be offered are
               initially convertible or exchangeable). Such adjustment shall become effective
               at the close of business on such record date; provided, however, that, to the
               extent the shares of Common Stock (or securities convertible into or
               exchangeable for shares of Common Stock) are not delivered, the Exercise Price
               shall be readjusted after the expiration of such rights, options, or warrants
               (but only with respect to Warrants exercised after such expiration), to the
               Exercise Price which would then be in effect had the adjustments made upon the
               issuance of such rights, options, or warrants been made upon the basis of
               delivery of only the number of shares of Common Stock (or securities convertible
               into or exchangeable for shares of Common Stock) actually issued and the
               Exercise Price shall also be adjusted for any subsequent adjustment or other
               change to the number of shares of Common Stock issuable upon exercise, exchange
               or conversion of such rights, options, warrants or other
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| | securities.
               Notwithstanding anything to the contrary contained herein, no adjustment shall
               be made to the Exercise Price until any condition to the vesting of such rights,
               options or warrants shall be fulfilled or satisfied (and than only with respect
               to the portion thereof which shall have vested). In case any subscription price
               may be paid in a consideration part or all of which shall be in a form other
               than cash, the value of such consideration shall be as determined in good faith
               by the board of directors of the Company, whose determination shall be
               conclusive absent manifest error. Shares of Common Stock owned by or held for
               the account of the Company or any majority-owned subsidiary shall not be deemed
               outstanding for the purpose of any such computation. If any event occurs of the
               type contemplated by the provisions of this paragraph but not expressly provided
               for by such provisions (including, without limitation, the granting of stock
               appreciation rights or other rights with equity features), then the board of
               directors of the Company shall make an appropriate adjustment in the Exercise
               Price so as to equitably protect the rights of holders of this Warrant.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c)       
               In case the Company shall distribute to all holders of Common Stock (including
               any such distribution made to the stockholders of the Company in connection with
               a consolidation or merger in which the Company is the continuing corporation)
               evidences of its indebtedness, cash (other than any cash dividend which,
               together with any cash dividends paid within the twelve (12) months prior to the
               record date for such distribution, does not exceed 5% of the Current Market
               Price at the record date for such distribution) or assets (other than
               distributions and dividends payable in shares of Common Stock), or rights,
               options, or warrants to subscribe for or purchase Common Stock, or securities
               convertible into or exchangeable for shares of Common Stockexcluding those with respect to the issuance of which an
               adjustment of the Exercise Price is provided pursuant to the foregoing
               paragraph, then, in each case, the Exercise Price shall be adjusted by
               multiplying the Exercise Price in effect immediately prior to the record date
               for the determination of stockholders entitled to receive such distribution by a
               fraction, the numerator of which shall be the Current Market Price per share of
               Common Stock on such record date, less the fair market value (as determined in
               good faith by the board of directors of the Company, whose determination shall
               be conclusive absent manifest error) of the portion of the evidences of
               indebtedness or assets so to be distributed, or of such rights, options, or
               warrants or convertible or exchangeable securities, or the amount of such cash,
               applicable to one share, and the denominator of which shall be such Current
               Market Price per share of Common Stock. Such adjustment shall become effective
               at the close of business on such record date.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | For the purpose of any computation under this Warrant, the Current Market Price
per share of Common Stock on any date shall be deemed to be the average of the daily
closing prices for the five (5) consecutive trading days immediately preceding the date in
question. The closing price for each day shall be (a) the last reported sales price
regular way or, in case no such reported sale takes place on such day, the closing bid
price regular way, in either case on the principal national securities exchange or market
system (including, for purposes hereof, the AMEX on which the Common Stock is listed for
trading), (b) if the Common Stock is not then listed or admitted to trading on any
national securities exchange or market system, the highest reported bid price for the
Common Stock, as furnished by the National Association of Securities Dealers, Inc. or a
similar
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| | organization if AMEX is no longer reporting such information, or (c) if on
any such date the Common Stock is not listed or admitted to trading on any national
securities exchange and is not quoted by AMEX or any similar organization, as determined
by reference to the Pink Sheets published by the National Quotation Bureau or,
if not so published, by such other method of determining the market value of a share of
Common Stock, as the board of directors of the Company shall in good faith from time to
time deem to be fair, whose determination shall be conclusive absent manifest error shall
be used.
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| | No
adjustment in the Exercise Price shall be required if such adjustment is less than $.05;
provided, however, that any adjustments which by reason of this Warrant are
not required to be made shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Warrant shall be made to the nearest cent or to
the nearest one thousandth of a share, as the case may be.
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| | In
any case in which this Warrant Certificate shall require that an adjustment in the
Exercise Price be made effective as of a record date for a specified event, the Company
may elect to defer, until the occurrence of such event, issuing to the Registered Holder,
if the Registered Holder has exercised a Warrant after such record date, the shares of
Common Stock, if any, issuable upon such exercise over and above the shares of Common
Stock, if any, issuable upon such exercise on the basis of the Exercise Price in effect
prior to such adjustment; provided, however, that the Company shall deliver
to the Registered Holder a due bill or other appropriate instrument evidencing the
Registered Holders right to receive such additional shares upon the occurrence of
the event requiring such adjustment.
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| | Upon
each adjustment of the Exercise Price as a result of the calculations made pursuant to (b)
and (c) above the Warrants shall thereafter evidence the right to purchase, at the
adjusted Exercise Price, that number of shares (calculated to the nearest thousandth)
obtained by dividing (A) the product obtained by multiplying the number of shares
purchasable upon exercise of the Warrants prior to adjustment of the number of shares by
the Exercise Price in effect prior to adjustment of the Exercise Price by (B) the
Exercise Price in effect after such adjustment of the Exercise Price.
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| | In
case of any capital reorganization, other than in the cases referred to above, or the
consolidation or merger of the Company with or into another corporation (other than a
merger or consolidation in which the Company is the continuing corporation and which does
not result in any reclassification of the outstanding shares of Common Stock or the
conversion of such outstanding shares of Common Stock into shares of other stock or other
securities or property), or the sale of the property of the Company as an entirety or
substantially as an entirety (collectively such actions being hereinafter referred to as
Reorganizations), there shall thereafter be deliverable upon exercise of any
Warrant (in lieu of the number of shares of Common Stock theretofore deliverable) the kind
and number of shares of stock or other securities or property to
which the Registered Holder of the number of shares of Common Stock which would otherwise
have been deliverable upon the exercise of such Warrant would have been entitled upon such
Reorganization if such Warrant had been exercised in full immediately prior to such
Reorganization or for relevant record date for such entitlement. In case of any
Reorganization, appropriate
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5



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| | adjustment, as determined in good faith by the Board of
Directors of the Company, shall be made in the application of the provisions herein set
forth with respect to the rights and interests of the Registered Holder so that the
provisions set forth herein shall thereafter be applicable, as nearly as practicable, in
relation to any shares or other property thereafter deliverable upon exercise of Warrant.
The Company shall not effect any such Reorganization, unless upon or prior to the
consummation thereof the successor corporation, or if the Company shall be the surviving
corporation in any such Reorganization and is not the issuer of the shares of stock or
other securities or property to be delivered to holders of shares of the Common Stock
outstanding at the effective time thereof, then such issuer, shall assume by written
instrument the obligation to deliver to the Registered Holder of any warrant certificate
such shares of stock, securities, cash or other property as such holder shall be entitled
to purchase in accordance with the foregoing provisions. Notwithstanding anything to the
contrary contained herein, in the event of sale or conveyance or other transfer of all or
substantially all of the assets of the Company as a part of a plan for liquidation of the
Company, all rights to exercise any Warrant shall terminate thirty (30) days after the
Company gives written notice to each Registered Holder that such sale or conveyance of
other transfer has been consummated.
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| | In
case of any reclassification or change of the shares of Common Stock issuable upon
exercise of the Warrant, including, without limitation, in any reorganization (other than
a change in par value or from no par value to a specified par value, or as a result of a
subdivision or combination, but including any change in the shares into two or more
classes or series of shares), the Registered Holder of the Warrant shall have the right
thereafter to receive upon exercise of the Warrant solely the kind and amount of shares of
stock and other securities, property, cash, or any combination thereof receivable upon
such reclassification or change by the Registered Holder of the number of shares of Common
Stock for which the Warrant might have been exercised immediately prior to such
reclassification or change and the term Common Stock shall thereafter include,
without limitation, such stock and other securities or right to cash distribution.
Thereafter, appropriate provision shall be as nearly equivalent as practicable to the
adjustments in this Warrant. The above provisions of this paragraph shall similarly apply
to successive reclassifications and changes of shares of Common Stock.
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| | Notwithstanding
anything to the contrary herein contained, in the event of a transaction contemplated by
the prior paragraph in which the surviving, continuing, successor, or purchasing
corporation demands that all outstanding Warrant be extinguished prior to the closing date
of the contemplated transaction, the Company shall give prior notice (the Merger
Notice) thereof to the Registered Holder advising it of such transaction. The
Registered Holder shall have ten (10) days after the date of the Merger Notice to elect to
(i) exercise the Warrant in the manner provided herein or (ii) receive from the
surviving, continuing, successor, or purchasing corporation, with respect to outstanding
Warrant, the same consideration receivable by a Registered Holder of the number of shares
of Common Stock for which the Warrant might have been exercised immediately prior to such
consolidation, merger, sale, or purchase reduced by such amount of the consideration as
has a market value equal to the exercise price of the Warrant, as determined by the Board
of Directors of the Company, whose determination shall be conclusive absent manifest
error. If a Registered Holder fails to timely notify the
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| | Company of its election, it shall
be deemed for all purposes to have elected the option set forth in (ii) above. Any amounts
receivable by a Registered Holder who has elected the option set forth in (ii) above shall
be payable at the same time as amounts payable to stockholders in connection with any such
transaction.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Whenever
the Exercise Price is adjusted as provided in this Warrant, the Company will promptly
obtain a certificate of the chief financial officer of the Company setting forth the
Exercise Price as so adjusted and a brief statement of the facts accounting for such
adjustment. Whenever any adjustment is made pursuant to this Warrant, the Company shall
cause notice of such adjustment to be mailed to the Registered Holder within fifteen (15)
days thereafter, such notice to include in reasonable detail (i) the events
precipitating the adjustment, (ii) the computation of any adjustments, and
(iii) the Exercise Price, the number of shares or the securities or other property
purchasable upon exercise of each Warrant after giving effect to such adjustment.
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In
no event shall the Exercise Price be adjusted below the par value per share of the Common
Stock.

In
case at any time the Company shall propose:

| | (a)       
               to pay any dividend or make any distribution on shares of Common Stock in shares
               of Common Stock or make any other distribution (other than regularly scheduled
               cash dividends which are not in a greater amount per share than the most recent
               such cash dividend) to all holders of Common Stock; or
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b)       
               to issue any rights, warrants, or other securities to all holders of Common
               Stock entitling them to purchase any additional shares of Common Stock or any
               other rights, warrants, or other securities; or
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c)       
               to effect any reclassification or change of outstanding shares of Common Stock,
               or any consolidation, merger, sale, lease, or conveyance of property, described
               above; or
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (d)       
               to effect any liquidation, dissolution, or winding-up of the Company;
| | -----------------------------------------------------------------------------------------------

| | then, in each such case, the Company shall cause notice of such proposed action to be mailed to
the Registered Holder of a warrant certificate. Such notice shall be mailed, at least ten
(10) days prior to the record date for determining holders of the Common Stock for
purposes of receiving such payment or offer or at least ten (10) days prior to the earlier
of the date upon which such action is to take place or any record date to determine
holders of Common Stock entitled to receive such securities or other property, as the case
may be.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Whenever any adjustment is made pursuant to this Warrant, the Company shall cause notice of such
adjustment to be mailed to each Registered Holder of a Warrant Certificate within fifteen
(15) days thereafter, such notice to include in reasonable detail (i) the
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

7



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| | events
precipitating the adjustment, (ii) the computation of any adjustments, and
(iii) the Exercise Price, the number of shares or the securities or other property
purchaseable upon exercise of each Warrant after giving effect to such adjustment.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Irrespective
of any adjustments pursuant to this Warrant, Warrant Certificates theretofore or
thereafter issued need not be amended or replaced, but certificates thereafter issued
shall bear an appropriate legend or other notice of any adjustments.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Company shall not be required upon the exercise of any Warrant to issue fractional shares
of Common Stock which may result from adjustments in accordance with this Warrant to the
Exercise Price or number of shares of Common Stock purchasable under each Warrant. If more
than one Warrant is exercised at one time by the same Registered Holder, the number of
full shares of Common Stock which shall be deliverable shall be computed based on the
number of shares deliverable in exchange for the aggregate number of Warrant exercised.
With respect to any final fraction of a share called for upon the exercise of any Warrant
or portion thereof, the Company shall pay a cash adjustment in respect of such final
fraction in an amount equal to the same fraction of the Current Market Price of a share of
Common Stock calculated in accordance with this Warrant.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Registered Holder hereby agrees not to sell, contract to sell, or otherwise sell, dispose
of, loan, pledge or grant any rights (collectively, a Disposition) with
respect to the Warrants or the Common Stock underlying the Warrants or any other
securities of the Company issued in respect of the Warrants or the Common Stock underlying
the Warrants (by way of stock split, stock dividend or other distribution,
recapitalization or otherwise) (collectively, Securities) now owned or
hereafter acquired directly by the Registered Holder or with respect to which such
Registered Holder has or hereafter acquires the power of Disposition, otherwise than with
the prior written consent of the Company. The foregoing restrictions shall commence on the
date hereof and end on the one-year anniversary of the date hereof (the Lock-up
Period). The foregoing restriction has been expressly agreed to preclude the holder
of the Securities from engaging in any hedging or other transaction that is designed to or
reasonably expected to lead to or result in a Disposition of Securities during the Lock-up
Period, even if such Securities would be disposed of by someone other than such holder.
Such prohibited hedging or other transactions would include, without limitation, any short
sale (whether or not against the box) or any purchase, sale or grant of any right
(including, without limitation, any put or call option) with respect to any Securities or
with respect to any security (other than a broad-based market basket or index) that
includes, relates to or derives any significant part of its value from the Securities. The
Registered Holder also agrees and consents to the entry of stop transfer instructions with
the Companys transfer agent against the transfer of Securities held by the
Registered Holder except in compliance with the foregoing restrictions.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | No Warrant may be exercised after 5:00 P.M., New York City time, on the expiration date (the
Expiration Date) which will be August 18, 2007. The Warrant evidenced hereby
shall thereafter become void.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

8



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| | No Warrant Certificate shall entitle the registered holder thereof to any of the rights of a
stockholder of the Company, including, without limitation, the right to vote, to receive
dividends and other distributions, to receive any notice of, or to attend, meetings of
stockholders or any other proceedings of the Company.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | If any Warrant Certificate shall be mutilated, lost, stolen or destroyed, the Company in its
discretion may execute and deliver, in exchange and substitution for and upon cancellation
of a mutilated Warrant Certificate, or in lieu of or in substitution for a lost, stolen or
destroyed Warrant Certificate, a new Warrant Certificate for the whole or partial Warrant
represented by the Warrant Certificate so mutilated, lost, stolen or destroyed but only
upon receipt of evidence of such loss, theft or destruction of such Warrant Certificate,
and of the ownership thereof, and indemnity, if requested, all satisfactory to the
Company. Applicants for such substitute Warrant Certificates shall also comply with such
other reasonable regulations and pay such other reasonable charges incidental thereto as
the Company may prescribe. Any such new Warrant Certificate shall constitute an original
contractual obligation of the Company, whether or not the allegedly lost, stolen,
mutilated or destroyed Warrant Certificate shall be at any time enforceable by anyone.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Prior to the latest time at which the Warrant may be exercised, subject to any applicable laws,
rules or regulations restricting transferability, Warrant Certificates, subject to the
provisions hereof, may be split up, combined or exchanged for other Warrant Certificates
representing a like Warrant, or portion thereof or may be transferred in whole or in part.
Any holder desiring to split up, combine or exchange a Warrant Certificate or Warrant
Certificates shall make such request in writing delivered to the Company at its principal
office and shall surrender the Warrant Certificate or Warrant Certificates so to be split
up, combined or exchanged at said office with the Form of Assignment. Upon any such
surrender for split up, combination, exchange or transfer, the Company shall execute and
deliver to the person entitled thereto a Warrant Certificate or Warrant Certificates, as
the case may be, as so requested in the Form of Assignment. The Company may require the
Registered Holder to pay a sum sufficient to cover any tax or governmental charge that may
be imposed in connection with any split up, combination, exchange or transfer of Warrant
Certificates prior to the issuance of any new Warrant Certificate.
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| | Any Warrant Certificate surrendered upon the exercise of Warrant or for split up, combination,
exchange or transfer, or purchased or otherwise acquired by the Company, shall be canceled
and shall not be reissued by the Company; and, except as otherwise provided herein in case
of the exercise of less than all of the Warrant evidenced by a Warrant Certificate or in
case of a split up, combination, exchange or transfer, no Warrant Certificate shall be
issued hereunder in lieu of such canceled Warrant Certificate. Any Warrant Certificate so
canceled shall be destroyed by the Company.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Every holder of a Warrant Certificate by accepting the same consents and agrees with the Company
and with every other holder of a Warrant Certificate that:
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------

9



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| | (a)       
               transfer of the Warrant Certificates shall be registered on the books of the
               Company only if surrendered at the principal office of the Company, duly
               endorsed or accompanied by a proper instrument of transfer; and
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b)       
               prior to due presentment for registration of transfer, the Company may deem and
               treat the person in whose name the Warrant Certificate is registered as the
               absolute owner thereof and of the Warrant evidenced thereby (notwithstanding any
               notations of ownership or writing on the Warrant Certificates made by anyone
               other than the Company) for all purposes whatsoever, and the Company shall not
               be affected by any notice to the contrary.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The
laws of the State of New York shall govern this Warrant Certificate.

IN
WITNESS WHEREOF, the Company has caused this Warrant Certificate to be duly executed.

| | PALATIN TECHNOLOGIES, INC., 
| | ----------------------------
| |                             
| |                             
| | By:_________________________

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# FORM OF

# ELECTION TO PURCHASE

| | The undersigned hereby irrevocably elects to exercise of the Warrant represented by this
Warrant Certificate and to purchase the shares of Common Stock issuable upon the exercise
of said Warrant, and requests that certificates for such shares be issued and delivered as
follows:
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

ISSUETO:

(NAME)

---

(ADDRESS, INCLUDING ZIP
CODE)

at

---

(SOCIAL SECURITY OR OTHER TAX IDENTIFYING NUMBER)

DELIVERTO:

(NAME)

at

---

(ADDRESS, INCLUDING ZIP CODE)

| | If the portion of the Warrants hereby exercised is less than the full Warrant represented by
this Warrant Certificate, the undersigned requests that a new Warrant Certificate
representing the number of full Warrant not exercised be issued and delivered as set forth
below.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

| | In full payment of the purchase price with respect to the Warrant exercised and transfer
taxes, if any, the undersigned hereby tenders payment of $ by cash, certified or official
bank check or money order payable in United States currency to the order of the Company.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Dated:
__________

---

|(Insert Social Security or other identifying number
 of holder) | (Signature of registered holder)
|--------------------------------------------------------------- | --------------------------------

---

| | (Signature of registered holder, if co-owned)
| | ---------------------------------------------

| |  |  | NOTE: |  | Signature must conform in all respects to name of holder as specified on the face of the
Warrant Certificate
| |  |  | ----- |  | ------------------------------------------------------------------------------------------------------------

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# FORM OF ASSIGNMENT

| | FOR
VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto the Assignee
named below all of the rights of the undersigned represented by the within Warrant
Certificate, with respect to the Warrant, [or potion thereof], set forth below:
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Name of Assignee | Address | Portion of Warrant
|---------------- | ------- | ------------------

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| | and does hereby irrevocably constitute and appoint Attorney to make such transfer on the books
of Palatin Technologies, Inc. maintained for that purpose, with full power of substitution
in the premises.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Dated:
__________

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|(Insert Social Security or other identifying number
 of holder) | (Signature of registered holder)
|--------------------------------------------------------------- | --------------------------------

| | (Signature must conform in all respects to name of holder as specified on the face of the Warrant
Certificate.)
| | ---------------------------------------------------------------------------------------------------------------