If I remember rightly lactose is used as a flowing agent in meds.
This means that it helps the mixing of the different ingredients in a tablet or capsule.  Without it it is difficult to get the active ingredient distributed evenly throughout the whole batch of medicine before being formulated into a tablet.

I think it also helps as a binder, and so helps to make the tablets harder and allows them to be formed, rather tan just crumbling under the pressure used to shape the tablets.  By making the tablets harder it helps to stop them from degrading and improves shelf life.

Generally there is a tiny amount of lactose in tablets (I'm assuming it was a tablet that you bought) - in the region of a few milligrams.
Generally tablets containing lactose are fine for even sensitive lactose intolerant people to consume.  The amount is just far too small to have any effect on the body and it can pass though without problems.  Only people with severe lactase deficiency have been shown to have a reaction to the tiny amounts of lactose in medication.

I would be very suprised if the feelings you had was from a few milligrams of lactose, and it is more likely that it was an effect of the cold that you are suffering from.

Having said that I still find it frustrating to find that medication has lactose in and try to avoid it if possible too.  Try to stick to soluble tablets or liquids as they won't normally contain lactose (lactose is an insouble sugar and so not used in soluble tablets).