Ipsen's First Half 2007 Results and Financial Objectives for the Full Year 2007

Business Wire, August 29, 2007

* Increased effort in Research & Development

* Results in line with management expectations: full year 2007 operating margin guidance confirmed

PARIS -- The Board of Directors of Ipsen (Paris:IPN), chaired by Jean-Luc Belingard, met on 28 August 2007 to review the Group's results for the first half of 2007, published today.

[TABLE OMITTED]

(1) Net cash: cash, cash equivalents and securities held for sale minus bank overdrafts, bank borrowings and other financial liabilities plus or minus derivative financial instruments

Commenting on the performance in the first half 2007, Jean-Luc Belingard, President of the Ipsen Group, stated: "The Group's performance in the first half 2007 has been up to our expectations. Despite a yet more difficult environment, where price pressure and competition have further increased, Ipsen has achieved a sound sales growth performance. Our financial results this half are fully in line with our full year objectives and reflect our key strategic decisions, notably to continue to actively invest in R&D and to create an endocrinology platform in North America. These decisions are fully validated by our news flow: we have continued to achieve key objectives for the Group's development, notably with the marketing approval of Increlex([R]) in Europe. We have also launched Adrovance[TM] in France, closed the 051 study on Dysport([R]) in Cervical Dystonia in the US and completed the sale of Ginkor Fort([R]) to an OTC specialist. In this framework, we are able to confirm all of our financial objectives for the year and expect to fully offset in 2007 the price cut on Tanakan([R]) implemented on 1 July 2007 in France. The foundations to accelerate Ipsen's development have therefore been further strengthened and we look forward to the second half 2007 with confidence, with the actual commercial start of our partnership with Tercica, through the launch of Increlex([R]) in Europe and the expected approval of Somatuline([R]) in the US."

Review of half year 2007 results

Consolidated Group sales reached EU463.2 million, up 7.6% year-on-year. This increase was fuelled by the strong growth of Somatuline([R]), NutropinAq([R]) and Dysport([R]) and by the strong performance of gastroenterology products in international markets. Group sales were negatively impacted by price pressure, amounting to EU6.9 million, due notably to price cuts enforced by health authorities.

Other revenues totalled EU35.5 million, down 23.8% year-on-year. In the first half 2007, the Group ceased billings for R&D services within the framework of partnership agreements, mainly with Roche for the development of BIM 51077.

Total revenues therefore reached EU498.6 million during the period, up 4.5% year-on-year.

R&D expenses amounted to EU88.4 million, up 5.4% year-on-year, despite lower revenues received from third parties stemming from partnership agreements (notably BIM 51077), implying an increased self-financed R&D effort.

Operating income reached EU112.9 million in the first half 2007, up 4.2% year-on-year, despite the significant negative impact of price cuts in major Western European countries and the fall of other revenues. Operating margin stood at 24.4% of sales versus 25.2% a year ago.

The Group's effective tax rate in the first half 2007 reached 27.3% of net profit from continuing operations before tax and share in the results of associated companies, compared with a reported effective tax rate of 18.7% and with a recurring effective tax rate of 25.0% in the first half 2006.

The Group's loss from associates amounted to EU(3.5) million ($(4.6) million) and was solely composed of the Group's share in the net losses of Tercica Inc., stated as required under IFRS. Tercica Inc. has been reported in "loss from associates" in the Group's financial statements since October 2006.

Consolidated net profit for the first half 2007 was EU78.2 million, down 11.6% compared with EU88.5 million for the same period in 2006.

Net cash flow generated by operating activities amounted to EU47.3 million in the first half 2007, compared with EU130.2 million a year ago, when the Group benefited from important payments received in relation to its partnership agreements. At 30 June 2007, the Group's net cash position was EU198.4 million, compared with EU193.3 million at 30 June 2006.

Total milestones received in cash but not yet recognised as revenues amounted to EU192.7 million, compared with EU94.3 million in the first half 2006.

2007 financial objectives

On the basis of its performance in the first half 2007 and currently available information, in particular after taking into account the 10% price decrease implemented on 1 July 2007 on Tanakan([R]) in France, the Group is confirming the objectives it has set for itself for the full year 2007:

* Sales growth of 6.5% to 7.5%;

* Total revenue growth of 4.0% to 5.0%;

* Operating margin of 22.0% to 23.0% of sales.

The objectives announced by the Group on March 19, 2007 did not take into account this price decrease of Tanakan([R]), implemented since then.