Sciele Pharma, Inc. Reports Results for the First Quarter of 2007

Business Wire, April 26, 2007

ATLANTA -- Sciele Pharma, Inc. (NASDAQ:SCRX):

First quarter 2007 financial results include:

* Revenues were $82.3 million, an increase of 24% over first quarter of 2006

* Diluted earnings per share were $0.36, an increase of 57% over first quarter of 2006

* EBITDAS(a), a non-GAAP measure, was $28.6 million, an increase of 31% over first quarter 2006

* Cash flow per share(b), a non-GAAP measure, was $0.54, an increase of 50% over first quarter 2006

The Company increases revenue and EPS guidance for full-year 2007:

* Full-year 2007 revenue is expected to be $365 million to $390 million, representing an increase of 25% to 33% over full-year 2006

* Full-year 2007 diluted EPS is expected to be $1.60 to $1.70, representing an increase of 33% to 42% over full-year 2006

* The increases in revenue and EPS guidance is based on Sciele's acquisition of Alliant Pharmaceuticals and the launch of a new Optinate formulation in the second quarter of 2007

Sciele Pharma, Inc. (NASDAQ:SCRX), a specialty pharmaceutical company, today announced revenues and earnings for the first quarter ended March 31, 2007. Net revenues for the first quarter of 2007 increased 24% to $82.3 million from $66.5 million in the first quarter of 2006. Diluted earnings per share (EPS) for the first quarter of 2007 increased 57% to $0.36 compared with $0.23 the first quarter of 2006. Earnings before interest, taxes, depreciation and amortization, and stock compensation expense (EBITDAS, a non-GAAP measure) were $28.6 million in the first quarter of 2007 compared with $21.8 million in the first quarter of 2006. Cash flow per share, also a non-GAAP measure, was $0.54 for the first quarter of 2007 compared with $0.36 for the first quarter of 2006.

Gross margin as a percentage of sales was 87% in the first quarter of 2007 compared with 86% in the first quarter of 2006. Selling, general and administrative expenses increased 15% to $39.7 million in the first quarter of 2007 compared with $34.5 million in the first quarter of 2006. The increase in selling, general and administrative expenses was primarily due to stock compensation expense and sales-related expenses, which included the Zovirax launch, sales force expansion, national sales meeting expense, and higher royalty and commission expenses. Research and development expenses were $6.0 million, or 7.3% of total revenues, for the first quarter of 2007, compared with $2.9 million, or 4.3% of total revenues, for the first quarter of 2006. This increase was primarily due to the product development costs associated with the new Sular formulation and glycopyrrolate for chronic, moderate-to-severe drooling in pediatric patients.

On April 24, 2007, Sciele announced that it had reached an agreement to acquire Alliant Pharmaceuticals, Inc., a privately held pediatric specialty pharmaceutical company headquartered in Alpharetta, Georgia. Sciele will pay $122 million in cash for Alliant, which includes approximately $12 million in indebtedness to be paid at the closing. This transaction is subject to approval under the Hart-Scott-Rodino Antitrust Improvement Act, as well as other customary closing conditions, and is expected to be completed during the second quarter of 2007.

Alliant Pharmaceuticals is expected to generate revenues of approximately $50 to $60 million for the full-year 2007. Alliant has a field sales force of approximately 85 people who will be retained by Sciele and form Sciele's new Pediatric sales division.

Patrick Fourteau, President and Chief Executive Officer of Sciele Pharma, stated, "We are pleased with our strong growth in revenue and earnings in the first quarter of this year, as well as the progress we have made in our product pipeline. During the past year, we expanded our sales force and we are now realizing increased revenues from this investment by leveraging our sales platform. We are very enthusiastic about our recently announced agreement to acquire Alliant Pharmaceuticals. This acquisition should provide Sciele with an excellent opportunity for revenue and earnings growth by strategically expanding into pediatrics with well-recognized branded prescription products. Both companies have a similar business model which should facilitate a quick integration of Alliant into Sciele."

Cardiovascular/Diabetes Products

Net revenues of the Company's Cardiovascular/Diabetes products, which include Sular, Triglide, Fortamet Altoprev, and Nitrolingual Pumpspray, increased 21% to $56.7 million in the first quarter of 2007, compared with $46.8 million in the first quarter of 2006. This solid increase was primarily due to the sales growth of Sular and Triglide, as well as price increases. Cardiovascular/Diabetes product sales were 69% of total revenues for the first quarter of 2007.

New prescriptions of Sular increased 9% and total prescriptions increased 14% in the first quarter of 2007 compared with the first quarter of 2006, according to IMS Health's National Prescription Audit Plus[TM] data.