SCOLR Pharma, Inc. Reports Year End 2007 Financial Results

Business Wire, March 11, 2008

BELLEVUE, Wash. -- SCOLR Pharma, Inc. (AMEX: DDD) today reported financial results for the fiscal year ended December 31, 2007.

Total revenues for the year ended December 31, 2007, were $2.0 million, compared to $2.3 million for 2006. Royalty income increased 38%, or $321,457, to $1.2 million for 2007, compared to $856,027 for 2006. The increase in royalty income from SCOLR's alliance with Perrigo was offset by a decrease in research and development revenue due to the termination of its agreement with Wyeth Consumer Healthcare in 2007.

In the first quarter of 2007, SCOLR received approximately $600,000 in milestone payments from Wyeth, and, recognized previously deferred licensing fee income of approximately $173,000 associated with its agreement with Wyeth. The December 2005 agreement with Wyeth provided for an upfront fee of $250,000 which was recorded as deferred revenue and was being amortized over the development period until the contract was terminated in March 2007, at which time the remaining balance was recorded to income. In 2006, total revenue included $1.3 million in milestone payments under the Wyeth agreement.

Operating loss was $11.3 million for 2007, compared to a loss of $12.5 million for 2006. The decrease was primarily due to lower operating expenses, including costs associated with the amendments to SCOLR's license agreements with Temple University and Archer-Daniels-Midland in 2006, and non-cash share-based compensation expense resulting from the adoption of Share-Based Payment, ("SFAS 123(R)") in 2006.

SCOLR's net loss decreased 1%, or $124,292, to $10.6 million for 2007, compared to $10.7 million for 2006, primarily due to lower operating expenses, including costs associated with the amendments to SCOLR's license agreements with Temple University and ADM in 2006, and non-cash share-based compensation expense resulting from the adoption of SFAS 123(R) in 2006. The net loss per diluted share for 2007 was $0.28, compared to a net loss per diluted share of $0.29, for 2006.

Year-end 2007 Highlights:

* Completed two of three product performance pivotal trials to evaluate the safety and efficacy of SCOLR's over-the-counter (OTC) 12-hour CDT-based ibuprofen. SCOLR currently expects to complete the third of these trials by the end of the second quarter of 2008. The Food and Drug Administration (FDA) recently provided guidance on a label comprehension study and a consumer use study that will be required for product approval. Subject to successful completion of this final performance trial, and any additional guidance from the FDA, SCOLR's goal is to file a New Drug Application in the second half of 2008. If its ibuprofen product is approved by the FDA, SCOLR believes it would be the first and only 12-hour, extended-release ibuprofen product on the OTC market. Ibuprofen is used for the treatment of pain, fever, and inflammation that is sold in immediate-dose products such as Advil[R] and Motrin[R], among others, as well as under numerous store brands;

* Continued preparations for submission of SCOLR's first Abbreviated New Drug Application (ANDA) for a 12-hour CDT-based pseudoephedrine product. SCOLR currently expects to submit its ANDA to the FDA in 2008;

* Entered into a collaboration and license agreement with Dr. Reddy's Laboratories (NYSE:RDY), for the development and commercialization of an undisclosed oral prescription drug with significant potential for the cardiopulmonary market utilizing SCOLR's CDT technology. Under the terms of the agreement, Dr. Reddy's will be responsible for the development, manufacturing and marketing of the product. SCOLR has completed initial formulation work and commenced product transfer activities. The agreement provides double-digit participation in net profits for SCOLR after recovery of development and commercialization expenses associated with the potential product.

* Completed initial CDT formulations and preclinical evaluations of peramivir. Further steps to advance development are under discussion with BioCryst. Peramivir is currently being tested in clinical trials by BioCryst as a potential intramuscular and intravenous treatment for seasonal and life-threatening influenza;

* Completed internal development of SCOLR's prototype once-daily CDT-based risperidone and rivastigmine formulations. SCOLR does not plan to initiate clinical studies for these products without additional funding. Risperidone is used for the management of schizophrenia and bipolar mania. Rivastigmine is typically prescribed for the management of Alzheimer's disease;

* Appointed Dr. Bruce S. Morra, Ph.D., M.B.A., Dr. Jeffrey B. Reich, M.D. and Gregory L. Weaver, CPA, M.B.A, three senior executives with strong backgrounds in healthcare to the board of directors;

* Announced an extension of SCOLR's research agreement for continuing formulation and prototype development activities for commercial evaluation of an undisclosed CDT-based application for a major consumer products company;

* Received a fifth patent (#7,229,642) from the United States Patent and Trademark Office entitled "Amino Acid Modulated Extended Release Dosage Form." This new patent is the third for SCOLR's amino acid-based CDT drug delivery platform. SCOLR Pharma's amino acid-based technology is one of the patented/proprietary approaches within its CDT drug delivery platform for formulating novel tablets and capsules; and,