Orphan Medical Reports First Quarter Results

Apr 19, 2001, 01:00 ET from Orphan Medical, Inc.

    MINNEAPOLIS, April 19 /PRNewswire/ -- Orphan Medical, Inc. (Nasdaq:   ORPH),
 a specialty pharmaceutical company dedicated to patients with uncommon and
 inadequately treated diseases, today announced results for the first quarter
 ended March 31, 2001.  The Company reported first quarter revenues of $2.3
 million, a 15 percent decrease from the $2.7 million reported in the first
 quarter of 2000. The Company also reported a net loss to common shareholders
 of $1.6 million or $0.19 per diluted share, compared to the net loss of $1.1
 million or $0.15 per diluted share in the first quarter of 2000.
     As expected, sales of Antizol(R) (fomepizole) Injection decreased compared
 to the prior year.  Throughout fiscal 2000 more wholesale distributors
 initially stocked Antizol in many of their distribution centers as compared to
 ordering and shipping directly to users.  While domestic sales of Busulfex(R)
 (busulfan) Injection increased slightly compared to the prior year,
 international sales declined because our international distributor purchased
 an initial stocking amount in the prior year.  Sales of Antizol reflect the
 expected usage and stocking pattern of the product now that it has been
 marketed for more than three years.  Domestic use of Busulfex in preparative
 regimens for bone marrow transplantation grew slightly in the quarter.
 Busulfex is marketed in the United States, Canada and Israel where the drug
 provides an alternative to oral busulfan and total body irradiation.  Gross
 margins increased slightly during the first quarter as a result of product
 mix.
     The Company had $11.4 million of available funds, including lines of
 credit, as of March 31.  The Company used approximately $2.6 million of cash
 during the quarter.  As expected, this rate was higher than the fourth quarter
 of last year.  This is primarily due to increased sales and marketing expenses
 for the launch of Xyrem and additional corporate infrastructure.  Development
 expenses were lower during the quarter compared to prior year, but are
 expected to increase to prior year levels over the remainder of the year.
     John H. Bullion, Chief Executive Officer, commented: "We anticipated that
 quarterly sales would decline slightly as a result of stocking in the prior
 year.  Use of Antizol and Busulfex remains strong, however.  Our cash usage
 increased in the quarter and we anticipate similar usage in the upcoming
 quarters. We are focusing our efforts on the upcoming Advisory Committee
 meeting and the launch of Xyrem.  Plans to manufacture, distribute and sell
 Xyrem are in place and work continues on the Phase III(b) controlled clinical
 trial designed to assess the efficacy of Xyrem in treating excessive daytime
 sleepiness related to narcolepsy.  Patient enrollment is underway and the
 clinical portion of this trial is targeted to be complete by the end of this
 year."
     Xyrem(R) (sodium oxybate) oral solution Update
     On March 30, 2001, the Company announced that the Food and Drug
 Administration (FDA) issued a 90-day extension to the Company's New Drug
 Application (NDA) for Xyrem.  The extension permits FDA review of the
 amendment submitted in response to the agency's request for clarification of
 supplemental data generated outside of Company sponsored trials.  The Company
 is supporting the FDA's review of the Xyrem NDA, including the supplemental
 information, and is now preparing for a June 6, 2001 meeting before the
 Peripheral and Central Nervous System Advisory Committee to review the safety,
 efficacy, and risk management of Xyrem.  The rescheduling of the Xyrem
 advisory Committee meeting moves the FDA's action deadline for the NDA from
 early April 2001 to early July 2001.
     Xyrem has been developed as a potential treatment for narcolepsy.
 Narcolepsy is a chronic neurological disorder affecting an estimated 100,000
 to 125,000 Americans, whose main symptoms are excessive daytime sleepiness and
 cataplexy. Cataplexy is a debilitating symptom characterized by loss of muscle
 control in response to strong emotional reactions such as laughter, anger, or
 surprise. In its most severe form, cataplexy can cause a person to collapse
 during waking hours. Based on these and other assumptions, the U.S. cataplexy
 market is estimated in the range of $50 million to $100 million annually. The
 total narcolepsy market is estimated in the $100 to $200 million range
 annually in the United States.
 
     Outlook for 2001
     The Company expects sales from currently marketed products to increase
 slightly for the year ended December 31, 2001 as compared to the prior year.
 Quarterly sales and marketing expenditures in the remainder of 2001 will
 approximate current levels or slightly increase to support the continuing
 commercial activities relating to Xyrem.  General and administrative expenses
 will also increase as the Company continues to build the infrastructure
 necessary to support Xyrem.  Development expenses are expected to increase
 slightly as a result of the completion of the Phase III(b) trial for Xyrem
 that is underway.
 
                                                          (Unaudited)
                                                Three Months Ended March 31,
                                                         2001           2000
     (000s, except per share and share data)
     Net sales                                         $2,342         $2,742
     Cost of sales                                        290            459
     Gross profit                                       2,052          2,283
     Operating expenses:
     Development                                          906          1,766
     Sales & marketing                                  1,567            805
     General & administrative                           1,116            735
      Total operating expenses                          3,589          3,306
     Loss from operations                             (1,537)        (1,023)
     Other income: net interest income                    147            125
     Net loss                                         (1,390)          (898)
     Less: Preferred stock dividend                     (221)          (211)
     Net loss applicable to common shareholders      $(1,611)       $(1,109)
     Net loss per share (a)                           $(0.19)        $(0.15)
     Average number of shares outstanding           8,463,610      7,288,125
 
     (a) Basic and diluted loss per share amounts are identical
 
     SELECTED BALANCE SHEET DATA
                                                           (Unaudited)
                                                    March 31,   December 31,
                                                         2001           2000
     Assets
     Cash, Cash Equivalents and Investments           $ 8,812       $ 11,417
     Other assets                                       3,618          3,880
     Total assets                                    $ 12,430       $ 15,297
 
     Liabilities and shareholders' equity:
     Current Liabilities                              $ 2,963        $ 4,554
     Non-Current Liabilities                               --             --
 
     Shareholders' Equity                               9,467         10,743
     Total liabilities and shareholders' equity      $ 12,430       $ 15,297
 
     Orphan Medical acquires, develops, and markets pharmaceuticals of high
 medical value for inadequately treated and uncommon diseases. The Company
 serves three strategic therapeutic market segments that are characterized by
 well-defined patient populations and served by physician specialists: oncology
 support, antidotes and sleep disorders. Orphan Medical's Internet Web site
 address is http://www.orphan.com
     Listen to Orphan Medical, Inc.'s Fourth Quarter Conference call live on
 the Internet at:
 http://webcast.themeetingson.com/webcast.jsp?reservation=17838627
 
     Contact: John Howell Bullion (CEO) or Tim McGrath (CFO) of Orphan Medical
 at 952-513-6900 or Noonan/Russo Communications, Inc., 212-696-4455
 Stephen Gendel (media), ext. 212 David Walsey (investors), ext. 230
 news@noonanrusso.com
 
     The information in this press release may contain forward-looking
 statements within the meaning of the Private Securities Litigation Reform Act
 of 1995.  A number of factors could cause actual results to differ materially
 from the Company's assumptions and expectations.  These are set forth in the
 cautionary statements included in Exhibit 99 to Orphan Medical's most recent
 Form 10-Q or Form 10-K filed with the Securities and Exchange Commission.
 Orphan Medical undertakes no obligation to update the information contained in
 this press release.  All forward-looking statements are qualified by, and
 should be considered in conjunction with, such cautionary statements.
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X76026404
 
 

SOURCE Orphan Medical, Inc.
    MINNEAPOLIS, April 19 /PRNewswire/ -- Orphan Medical, Inc. (Nasdaq:   ORPH),
 a specialty pharmaceutical company dedicated to patients with uncommon and
 inadequately treated diseases, today announced results for the first quarter
 ended March 31, 2001.  The Company reported first quarter revenues of $2.3
 million, a 15 percent decrease from the $2.7 million reported in the first
 quarter of 2000. The Company also reported a net loss to common shareholders
 of $1.6 million or $0.19 per diluted share, compared to the net loss of $1.1
 million or $0.15 per diluted share in the first quarter of 2000.
     As expected, sales of Antizol(R) (fomepizole) Injection decreased compared
 to the prior year.  Throughout fiscal 2000 more wholesale distributors
 initially stocked Antizol in many of their distribution centers as compared to
 ordering and shipping directly to users.  While domestic sales of Busulfex(R)
 (busulfan) Injection increased slightly compared to the prior year,
 international sales declined because our international distributor purchased
 an initial stocking amount in the prior year.  Sales of Antizol reflect the
 expected usage and stocking pattern of the product now that it has been
 marketed for more than three years.  Domestic use of Busulfex in preparative
 regimens for bone marrow transplantation grew slightly in the quarter.
 Busulfex is marketed in the United States, Canada and Israel where the drug
 provides an alternative to oral busulfan and total body irradiation.  Gross
 margins increased slightly during the first quarter as a result of product
 mix.
     The Company had $11.4 million of available funds, including lines of
 credit, as of March 31.  The Company used approximately $2.6 million of cash
 during the quarter.  As expected, this rate was higher than the fourth quarter
 of last year.  This is primarily due to increased sales and marketing expenses
 for the launch of Xyrem and additional corporate infrastructure.  Development
 expenses were lower during the quarter compared to prior year, but are
 expected to increase to prior year levels over the remainder of the year.
     John H. Bullion, Chief Executive Officer, commented: "We anticipated that
 quarterly sales would decline slightly as a result of stocking in the prior
 year.  Use of Antizol and Busulfex remains strong, however.  Our cash usage
 increased in the quarter and we anticipate similar usage in the upcoming
 quarters. We are focusing our efforts on the upcoming Advisory Committee
 meeting and the launch of Xyrem.  Plans to manufacture, distribute and sell
 Xyrem are in place and work continues on the Phase III(b) controlled clinical
 trial designed to assess the efficacy of Xyrem in treating excessive daytime
 sleepiness related to narcolepsy.  Patient enrollment is underway and the
 clinical portion of this trial is targeted to be complete by the end of this
 year."
     Xyrem(R) (sodium oxybate) oral solution Update
     On March 30, 2001, the Company announced that the Food and Drug
 Administration (FDA) issued a 90-day extension to the Company's New Drug
 Application (NDA) for Xyrem.  The extension permits FDA review of the
 amendment submitted in response to the agency's request for clarification of
 supplemental data generated outside of Company sponsored trials.  The Company
 is supporting the FDA's review of the Xyrem NDA, including the supplemental
 information, and is now preparing for a June 6, 2001 meeting before the
 Peripheral and Central Nervous System Advisory Committee to review the safety,
 efficacy, and risk management of Xyrem.  The rescheduling of the Xyrem
 advisory Committee meeting moves the FDA's action deadline for the NDA from
 early April 2001 to early July 2001.
     Xyrem has been developed as a potential treatment for narcolepsy.
 Narcolepsy is a chronic neurological disorder affecting an estimated 100,000
 to 125,000 Americans, whose main symptoms are excessive daytime sleepiness and
 cataplexy. Cataplexy is a debilitating symptom characterized by loss of muscle
 control in response to strong emotional reactions such as laughter, anger, or
 surprise. In its most severe form, cataplexy can cause a person to collapse
 during waking hours. Based on these and other assumptions, the U.S. cataplexy
 market is estimated in the range of $50 million to $100 million annually. The
 total narcolepsy market is estimated in the $100 to $200 million range
 annually in the United States.
 
     Outlook for 2001
     The Company expects sales from currently marketed products to increase
 slightly for the year ended December 31, 2001 as compared to the prior year.
 Quarterly sales and marketing expenditures in the remainder of 2001 will
 approximate current levels or slightly increase to support the continuing
 commercial activities relating to Xyrem.  General and administrative expenses
 will also increase as the Company continues to build the infrastructure
 necessary to support Xyrem.  Development expenses are expected to increase
 slightly as a result of the completion of the Phase III(b) trial for Xyrem
 that is underway.
 
                                                          (Unaudited)
                                                Three Months Ended March 31,
                                                         2001           2000
     (000s, except per share and share data)
     Net sales                                         $2,342         $2,742
     Cost of sales                                        290            459
     Gross profit                                       2,052          2,283
     Operating expenses:
     Development                                          906          1,766
     Sales & marketing                                  1,567            805
     General & administrative                           1,116            735
      Total operating expenses                          3,589          3,306
     Loss from operations                             (1,537)        (1,023)
     Other income: net interest income                    147            125
     Net loss                                         (1,390)          (898)
     Less: Preferred stock dividend                     (221)          (211)
     Net loss applicable to common shareholders      $(1,611)       $(1,109)
     Net loss per share (a)                           $(0.19)        $(0.15)
     Average number of shares outstanding           8,463,610      7,288,125
 
     (a) Basic and diluted loss per share amounts are identical
 
     SELECTED BALANCE SHEET DATA
                                                           (Unaudited)
                                                    March 31,   December 31,
                                                         2001           2000
     Assets
     Cash, Cash Equivalents and Investments           $ 8,812       $ 11,417
     Other assets                                       3,618          3,880
     Total assets                                    $ 12,430       $ 15,297
 
     Liabilities and shareholders' equity:
     Current Liabilities                              $ 2,963        $ 4,554
     Non-Current Liabilities                               --             --
 
     Shareholders' Equity                               9,467         10,743
     Total liabilities and shareholders' equity      $ 12,430       $ 15,297
 
     Orphan Medical acquires, develops, and markets pharmaceuticals of high
 medical value for inadequately treated and uncommon diseases. The Company
 serves three strategic therapeutic market segments that are characterized by
 well-defined patient populations and served by physician specialists: oncology
 support, antidotes and sleep disorders. Orphan Medical's Internet Web site
 address is http://www.orphan.com
     Listen to Orphan Medical, Inc.'s Fourth Quarter Conference call live on
 the Internet at:
 http://webcast.themeetingson.com/webcast.jsp?reservation=17838627
 
     Contact: John Howell Bullion (CEO) or Tim McGrath (CFO) of Orphan Medical
 at 952-513-6900 or Noonan/Russo Communications, Inc., 212-696-4455
 Stephen Gendel (media), ext. 212 David Walsey (investors), ext. 230
 news@noonanrusso.com
 
     The information in this press release may contain forward-looking
 statements within the meaning of the Private Securities Litigation Reform Act
 of 1995.  A number of factors could cause actual results to differ materially
 from the Company's assumptions and expectations.  These are set forth in the
 cautionary statements included in Exhibit 99 to Orphan Medical's most recent
 Form 10-Q or Form 10-K filed with the Securities and Exchange Commission.
 Orphan Medical undertakes no obligation to update the information contained in
 this press release.  All forward-looking statements are qualified by, and
 should be considered in conjunction with, such cautionary statements.
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X76026404
 
 SOURCE  Orphan Medical, Inc.