MGI PHARMA Reports 2001 First Quarter Results

Company Portfolio Now Includes Three Key Marketed Products & Two Phase 3

Compounds; Reports Record Salagen(R) Tablets Sales



Apr 18, 2001, 01:00 ET from MGI PHARMA, INC.

    MINNEAPOLIS, April 18 /PRNewswire/ -- MGI PHARMA, INC., (Nasdaq: MOGN)
 today reported that product sales revenue increased 53 percent to $7.0 million
 in the first quarter ended March 31, 2001, from $4.6 million in the first
 quarter of 2000.  Total revenues increased 46 percent to $7.6 million in the
 2001 first quarter from $5.2 million in the first quarter a year ago.  Total
 costs and expenses increased 98 percent to $11.1 million in the 2001 first
 quarter from $5.6 million in the 2000 first quarter.  The Company reported a
 net loss of $3.1 million, or $0.19 per share, in the first quarter of 2001
 compared to a net loss of $9.5 million, or $0.63 per diluted share, in the
 first quarter of 2000.  As previously noted, the prior year's results have
 been restated for the effect of implementing Staff Accounting Bulletin 101 as
 of January 1, 2000 and resulted in a charge of $9.4 million, or $0.62 per
 share, in the first quarter of 2000.
     The quarter's strong performance in product sales revenue was primarily
 due to growth in sales of Salagen(R) Tablets (pilocarpine hydrochloride) and
 from two recent oncology product additions, Hexalen(R) Capsules (altretamine)
 and Mylocel(TM) Tablets (hydroxyurea).  The increase in costs and expenses was
 primarily due to an increase in research and development expense related to
 the expanded development of two product candidates, irofulven and MG98, the
 recent promotional launches of new products, and an increase in selling
 expenses for the expansion of the sales organization which principally
 occurred in the second quarter of 2000.
     "We continue to deliver on our business plan by expanding our marketed
 product portfolio and accelerating our clinical development programs for
 irofulven and MG98," said Chuck Blitzer, president and CEO of MGI PHARMA.  "At
 the same time, our experienced marketing team and oncology sales force is
 delivering a record quarter performance in product sales.  The first quarter
 of 2001 includes sales from both Hexalen Capsules and Mylocel Tablets, for
 which we began direct promotion in March, in addition to the steadfast sales
 performance of Salagen Tablets, our flagship commercial product.  MGI is
 making great strides toward our goal of becoming a leader in oncology."
 
     Recent Company Highlights
 
     Clinical Developments:
 
     -- Initiated a pivotal Phase 3 clinical trial of irofulven, its novel
        anti-cancer compound, for patients with advanced-stage pancreatic
        cancer.  The trial is a randomized, multi-center, international trial
        in advanced-stage pancreatic cancer patients whose disease progressed
        after treatment with gemcitabine, the current standard-of-care
        treatment.
 
     -- Initiated a Phase 2 clinical trial of irofulven for patients with
        refractory or recurrent advanced ovarian cancer.
 
     -- Initiated another Phase 2 clinical trial of irofulven to treat
        hormone-refractory prostate cancer patients.  This randomized,
        multi-center Phase 2 trial conducted in Europe will evaluate the
        anti-tumor activity, safety, and clinical benefit of irofulven as a
        single agent and in combination with prednisone.
 
     -- Made six poster presentations on irofulven's anti-tumor activity and
        mechanism of action at this year's American Association for Cancer
        Research (AACR) meeting held in March.  The preclinical data presented
        serves as the basis for MGI's plans to expand the clinical development
        of irofulven in a variety of cancers both as a single agent and in
        combination with other drugs.
 
     In-Licensed Products:
 
     -- Signed definitive agreement granting MGI PHARMA exclusive North
        American license and distribution rights to palonosetron, a potent and
        selective 5-HT3 antagonist with an extended half-life, in Phase 3
        development for the prevention of chemotherapy-induced nausea and
        vomiting (CINV) with Helsinn Healthcare SA.  When launched,
        palonosetron would compete in the $1 billion North American CINV
        market.  In addition to the previously disclosed $11 million in upfront
        payments that became due upon signing the definitive agreements, MGI
        PHARMA is obligated to pay a total of $27 million in milestone payments
        upon achievement of the underlying development objectives, including
        marketing approval of palonosetron in the United States.  Helsinn will
        continue to fund and conduct all development of palonosetron.
 
     -- Signed exclusive agreement for the U.S. marketing and distribution
        rights for Mylocel Tablets, a recently FDA-approved oral tablet
        formulation of hydroxyurea for the treatment of certain malignancies,
        with Barr Laboratories, Inc.
 
     -- Launched exclusive promotion of Hexalen Capsules (altretamine) and
        Mylocel Tablets (hydroxyurea) in the U.S. oncology market.
 
     2001 Financial Outlook
     This section provides forward-looking information about MGI PHARMA's
 financial outlook for 2001.  These projections include the impact of MGI
 PHARMA's entire product portfolio, which comprises Salagen(R) Tablets,
 Hexalen(R) Capsules, Mylocel(TM) Tablets, irofulven and the other
 acylfulvenes, palonosetron, MG98 and the complementary small molecule
 inhibitor program.  The disclosure notice paragraph regarding forward-looking
 statements at the end of this news release is especially applicable to this
 section.  For the year ending December 31, 2001:
 
     -- Product sales are currently projected to grow 15 to 20 percent,
         (increased from last quarter guidance)
     -- Cost of product sales as a percent of sales revenue is expected to
         range from 10 to 15 percent,
     -- Licensing revenue is expected to approximate the annual 2000 amount
         after application of SAB 101, and would increase if commercial rights
         for irofulven outside the United States are out-licensed,
     -- R&D expense is expected to range from $35 to $45 million depending on
         the pace of irofulven and MG98 development and the timing of
         palonosetron milestone achievements,
     -- Selling, general and administrative expenses are expected to be
         approximately $25 million or less, (decreased from last quarter
         guidance)
     -- Amortization expense related to the acquisition of Hexalen Capsules is
         expected to be approximately $1.2 million, and
     -- Net loss is expected to range from $35 to $45 million.
 
     Webcast of First Quarter Conference Call
     MGI PHARMA will broadcast its 2001 first quarter results in an investor
 conference call live over the Internet on Wednesday, April 18, 2001 at
 1:00 p.m. Eastern Time.  The Company's executive management team will review
 first quarter 2001 financial results, answer questions from analysts and
 investors, and provide commentary on MGI's product portfolio and business
 outlook.  All interested parties are welcome to log on to
 http://www.mgipharma.com to listen to the webcast, which will also be archived
 on the Company's web site.
 
     About MGI PHARMA
     MGI PHARMA, INC. is an oncology-focused pharmaceutical company that
 acquires, develops and commercializes proprietary products that meet patient
 needs and build shareholder value.  MGI focuses its sales efforts solely in
 the United States and collaborates with other pharmaceutical or biotechnology
 companies for its products in international markets.  For more information
 about MGI, please visit the Company's web site at http://www.mgipharma.com
 
     This news release contains forward-looking statements that may include
 statements regarding intent, belief or current expectations of the Company and
 its management.  These forward-looking statements are not guarantees of future
 performance and involve a number of risks and uncertainties that may cause the
 Company's actual results to differ materially from the results discussed in
 these statements.  Factors that might affect MGI PHARMA's results include, but
 are not limited to the ability of MGI PHARMA's product candidates to be proven
 safe and effective in humans and to ultimately compete successfully with other
 therapies, continued sales of MGI PHARMA's commercial products, development or
 acquisition of additional products, reliance on contract manufacturing,
 changes in strategic alliances, continued access to capital, and other risks
 and uncertainties detailed from time to time in the Company's filings with the
 Securities and Exchange Commission.  MGI PHARMA does not intend to update any
 of the forward-looking statements after the date of this news release to
 conform them to actual results.
 
 
                                MGI PHARMA, INC.
                            Statements of Operations
                                  (Unaudited)
 
                                                  Three Months  Ended March 31,
                                                      2000           2001
     Revenues:
       Sales                                       $4,566,295     $6,984,108
       Promotion                                      250,000              0
       Licensing                                      361,056        591,669
                                                    5,177,351      7,575,777
 
     Costs and Expenses:
       Cost of sales                                  304,071        789,353
       Selling, general and administrative          3,520,584      6,492,775
       Research and development                     1,804,218      3,553,818
       Amortization                                         0        295,494
                                                    5,628,873     11,131,440
 
     Loss before interest and taxes                  (451,522)    (3,555,663)
     Interest income                                  372,846        436,166
     Loss before taxes                                (78,676)    (3,119,497)
     Provision for income taxes                        61,279              0
     Loss before cumulative effect
      of change in accounting principle              (139,955)    (3,119,497)
     Cumulative effect of change in
      accounting principle                         (9,402,643)             0
     Net loss                                     $(9,542,598)   $(3,119,497)
 
     Net loss per common share:
     Basic
       Loss before effect of accounting change         $(0.01)        $(0.19)
       Cumulative effect of accounting change           (0.62)          0.00
       Net loss                                        $(0.63)        $(0.19)
 
     Assuming dilution
       Loss before effect of accounting change         $(0.01)        $(0.19)
       Cumulative effect of accounting change           (0.62)          0.00
       Net loss                                        $(0.63)        $(0.19)
 
     Weighted average number of
     common shares:
         Basic                                     15,217,199     16,532,670
         Assuming dilution                         15,217,199     16,532,670
 
 
                               Balance Sheet Data
                                  (Unaudited)
 
                                                  December 31,     March 31,
                                                      2000           2001
     Cash and short-term investments              $29,898,787    $23,884,961
     Total assets                                  52,743,570     48,612,974
     Total stockholders' equity                    26,045,617     23,918,230
 
 

SOURCE MGI PHARMA, INC.
    MINNEAPOLIS, April 18 /PRNewswire/ -- MGI PHARMA, INC., (Nasdaq: MOGN)
 today reported that product sales revenue increased 53 percent to $7.0 million
 in the first quarter ended March 31, 2001, from $4.6 million in the first
 quarter of 2000.  Total revenues increased 46 percent to $7.6 million in the
 2001 first quarter from $5.2 million in the first quarter a year ago.  Total
 costs and expenses increased 98 percent to $11.1 million in the 2001 first
 quarter from $5.6 million in the 2000 first quarter.  The Company reported a
 net loss of $3.1 million, or $0.19 per share, in the first quarter of 2001
 compared to a net loss of $9.5 million, or $0.63 per diluted share, in the
 first quarter of 2000.  As previously noted, the prior year's results have
 been restated for the effect of implementing Staff Accounting Bulletin 101 as
 of January 1, 2000 and resulted in a charge of $9.4 million, or $0.62 per
 share, in the first quarter of 2000.
     The quarter's strong performance in product sales revenue was primarily
 due to growth in sales of Salagen(R) Tablets (pilocarpine hydrochloride) and
 from two recent oncology product additions, Hexalen(R) Capsules (altretamine)
 and Mylocel(TM) Tablets (hydroxyurea).  The increase in costs and expenses was
 primarily due to an increase in research and development expense related to
 the expanded development of two product candidates, irofulven and MG98, the
 recent promotional launches of new products, and an increase in selling
 expenses for the expansion of the sales organization which principally
 occurred in the second quarter of 2000.
     "We continue to deliver on our business plan by expanding our marketed
 product portfolio and accelerating our clinical development programs for
 irofulven and MG98," said Chuck Blitzer, president and CEO of MGI PHARMA.  "At
 the same time, our experienced marketing team and oncology sales force is
 delivering a record quarter performance in product sales.  The first quarter
 of 2001 includes sales from both Hexalen Capsules and Mylocel Tablets, for
 which we began direct promotion in March, in addition to the steadfast sales
 performance of Salagen Tablets, our flagship commercial product.  MGI is
 making great strides toward our goal of becoming a leader in oncology."
 
     Recent Company Highlights
 
     Clinical Developments:
 
     -- Initiated a pivotal Phase 3 clinical trial of irofulven, its novel
        anti-cancer compound, for patients with advanced-stage pancreatic
        cancer.  The trial is a randomized, multi-center, international trial
        in advanced-stage pancreatic cancer patients whose disease progressed
        after treatment with gemcitabine, the current standard-of-care
        treatment.
 
     -- Initiated a Phase 2 clinical trial of irofulven for patients with
        refractory or recurrent advanced ovarian cancer.
 
     -- Initiated another Phase 2 clinical trial of irofulven to treat
        hormone-refractory prostate cancer patients.  This randomized,
        multi-center Phase 2 trial conducted in Europe will evaluate the
        anti-tumor activity, safety, and clinical benefit of irofulven as a
        single agent and in combination with prednisone.
 
     -- Made six poster presentations on irofulven's anti-tumor activity and
        mechanism of action at this year's American Association for Cancer
        Research (AACR) meeting held in March.  The preclinical data presented
        serves as the basis for MGI's plans to expand the clinical development
        of irofulven in a variety of cancers both as a single agent and in
        combination with other drugs.
 
     In-Licensed Products:
 
     -- Signed definitive agreement granting MGI PHARMA exclusive North
        American license and distribution rights to palonosetron, a potent and
        selective 5-HT3 antagonist with an extended half-life, in Phase 3
        development for the prevention of chemotherapy-induced nausea and
        vomiting (CINV) with Helsinn Healthcare SA.  When launched,
        palonosetron would compete in the $1 billion North American CINV
        market.  In addition to the previously disclosed $11 million in upfront
        payments that became due upon signing the definitive agreements, MGI
        PHARMA is obligated to pay a total of $27 million in milestone payments
        upon achievement of the underlying development objectives, including
        marketing approval of palonosetron in the United States.  Helsinn will
        continue to fund and conduct all development of palonosetron.
 
     -- Signed exclusive agreement for the U.S. marketing and distribution
        rights for Mylocel Tablets, a recently FDA-approved oral tablet
        formulation of hydroxyurea for the treatment of certain malignancies,
        with Barr Laboratories, Inc.
 
     -- Launched exclusive promotion of Hexalen Capsules (altretamine) and
        Mylocel Tablets (hydroxyurea) in the U.S. oncology market.
 
     2001 Financial Outlook
     This section provides forward-looking information about MGI PHARMA's
 financial outlook for 2001.  These projections include the impact of MGI
 PHARMA's entire product portfolio, which comprises Salagen(R) Tablets,
 Hexalen(R) Capsules, Mylocel(TM) Tablets, irofulven and the other
 acylfulvenes, palonosetron, MG98 and the complementary small molecule
 inhibitor program.  The disclosure notice paragraph regarding forward-looking
 statements at the end of this news release is especially applicable to this
 section.  For the year ending December 31, 2001:
 
     -- Product sales are currently projected to grow 15 to 20 percent,
         (increased from last quarter guidance)
     -- Cost of product sales as a percent of sales revenue is expected to
         range from 10 to 15 percent,
     -- Licensing revenue is expected to approximate the annual 2000 amount
         after application of SAB 101, and would increase if commercial rights
         for irofulven outside the United States are out-licensed,
     -- R&D expense is expected to range from $35 to $45 million depending on
         the pace of irofulven and MG98 development and the timing of
         palonosetron milestone achievements,
     -- Selling, general and administrative expenses are expected to be
         approximately $25 million or less, (decreased from last quarter
         guidance)
     -- Amortization expense related to the acquisition of Hexalen Capsules is
         expected to be approximately $1.2 million, and
     -- Net loss is expected to range from $35 to $45 million.
 
     Webcast of First Quarter Conference Call
     MGI PHARMA will broadcast its 2001 first quarter results in an investor
 conference call live over the Internet on Wednesday, April 18, 2001 at
 1:00 p.m. Eastern Time.  The Company's executive management team will review
 first quarter 2001 financial results, answer questions from analysts and
 investors, and provide commentary on MGI's product portfolio and business
 outlook.  All interested parties are welcome to log on to
 http://www.mgipharma.com to listen to the webcast, which will also be archived
 on the Company's web site.
 
     About MGI PHARMA
     MGI PHARMA, INC. is an oncology-focused pharmaceutical company that
 acquires, develops and commercializes proprietary products that meet patient
 needs and build shareholder value.  MGI focuses its sales efforts solely in
 the United States and collaborates with other pharmaceutical or biotechnology
 companies for its products in international markets.  For more information
 about MGI, please visit the Company's web site at http://www.mgipharma.com
 
     This news release contains forward-looking statements that may include
 statements regarding intent, belief or current expectations of the Company and
 its management.  These forward-looking statements are not guarantees of future
 performance and involve a number of risks and uncertainties that may cause the
 Company's actual results to differ materially from the results discussed in
 these statements.  Factors that might affect MGI PHARMA's results include, but
 are not limited to the ability of MGI PHARMA's product candidates to be proven
 safe and effective in humans and to ultimately compete successfully with other
 therapies, continued sales of MGI PHARMA's commercial products, development or
 acquisition of additional products, reliance on contract manufacturing,
 changes in strategic alliances, continued access to capital, and other risks
 and uncertainties detailed from time to time in the Company's filings with the
 Securities and Exchange Commission.  MGI PHARMA does not intend to update any
 of the forward-looking statements after the date of this news release to
 conform them to actual results.
 
 
                                MGI PHARMA, INC.
                            Statements of Operations
                                  (Unaudited)
 
                                                  Three Months  Ended March 31,
                                                      2000           2001
     Revenues:
       Sales                                       $4,566,295     $6,984,108
       Promotion                                      250,000              0
       Licensing                                      361,056        591,669
                                                    5,177,351      7,575,777
 
     Costs and Expenses:
       Cost of sales                                  304,071        789,353
       Selling, general and administrative          3,520,584      6,492,775
       Research and development                     1,804,218      3,553,818
       Amortization                                         0        295,494
                                                    5,628,873     11,131,440
 
     Loss before interest and taxes                  (451,522)    (3,555,663)
     Interest income                                  372,846        436,166
     Loss before taxes                                (78,676)    (3,119,497)
     Provision for income taxes                        61,279              0
     Loss before cumulative effect
      of change in accounting principle              (139,955)    (3,119,497)
     Cumulative effect of change in
      accounting principle                         (9,402,643)             0
     Net loss                                     $(9,542,598)   $(3,119,497)
 
     Net loss per common share:
     Basic
       Loss before effect of accounting change         $(0.01)        $(0.19)
       Cumulative effect of accounting change           (0.62)          0.00
       Net loss                                        $(0.63)        $(0.19)
 
     Assuming dilution
       Loss before effect of accounting change         $(0.01)        $(0.19)
       Cumulative effect of accounting change           (0.62)          0.00
       Net loss                                        $(0.63)        $(0.19)
 
     Weighted average number of
     common shares:
         Basic                                     15,217,199     16,532,670
         Assuming dilution                         15,217,199     16,532,670
 
 
                               Balance Sheet Data
                                  (Unaudited)
 
                                                  December 31,     March 31,
                                                      2000           2001
     Cash and short-term investments              $29,898,787    $23,884,961
     Total assets                                  52,743,570     48,612,974
     Total stockholders' equity                    26,045,617     23,918,230
 
 SOURCE  MGI PHARMA, INC.