Veropharm Announces Q1 2007 Preliminary Results

17.04.2007

APRIL 17, 2007, MOSCOW – OAO VEROPHARM [RTS:VRPH, MICEX:VFRM] announces preliminary data on its first Quarter 2007 sales and operational performance indicators based on its management reports.

Sales

Veropharm net sales amounted to 24.5 million in Q1 2007 according to management estimates *.
In Q1 2007 sales of Veropharm’s finished goods have grown 27% compared to the same period in 2006, reaching USD 23.9 million **.
Rx drugs sales amounted to 12.7 million in Q1 2007, 36% increase in comparison with Q1 2006. The Rx drugs sales accounted for 53% in total sales.
In Q1 2007 traditional drug sales stood at USD 4.5 million, having grown by 30% in comparison with Q1 2006, and made up 19% of total sales.
Adhesive bandages sales came to USD 4.4 million in Q1 2007, equal to the sales of the first 3 months in 2006. The share of adhesive bandages in total sales was 18%.
OTC drugs sales amounted to USD 2.4 million in Q1 2007, 52% increase in comparison with Q1 2006, their share in total sales being equal to 10%.
Veropharm sales as part of the Governmental Reimbursement Program (DLO) came to USD 1.0 million in Q1 2007, accounting for 4% of the Company’s sales. By the results of Q1 2006, DLO sales were USD 1.7 m, or 9% of the Company’s total sales.
Sales within the Russian Federation accounted for 99% of the Company’s sales in Q1 2007.

Rx drugs segment

Total sales of the five most popular prescription drugs by the results of Q1 2007 amounted to USD 6.1 m, or 48% of sales in the prescription drugs segment and 25% of the Company’s total sales.

The top five bestsellers among prescription drugs by Q1 2007 results include:

Irunine (Itraconazole), 260% sales growth y-o-y;
Amigrenine (Sumatriptan), 182% sales growth y-o-y;
Cerepro (Choline alfoscerate), a new drug with production begun in 2006;
Paclitaxel-LENS (Paclitaxel), 9% sales growth y-o-y;
Doxorubicin-LENS (Doxorubicin), 84% sales growth y-o-y.

Traditional drugs segment

The traditional drugs segment has preserved the growing sales trend due to reduced production of such product types by other pharmaceutical plants in Russia.
Total sales of the five most popular traditional drugs by the results of Q1 2007 amounted to USD 2.6 m, which account for 59% of all traditional segment sales and 11% of the Company’s total sales.

The top five bestsellers among conventional drugs include:

Novocain (Procaine), 133% sales growth y-o-y;
Pyridoxine hydrochloride (Pyridoxine), 56% sales growth y-o-y;
Magnesium sulfate, 28% sales growth y-o-y;
Thiamine Chloride, 59% sales growth y-o-y;
Nicotinic acid, 20% sales growth y-o-y.

Adhesive bandages segment

Sales in the adhesive bandages segment remained stable. By the results of Q1 2007, sales structure was as follows:

Conventional reel and bacterial adhesive bandages, 14% sales decrease y-o-y;
Therapeutic patches (capsicum and corn plasters), 31% sales drop y-o-y;
“Uniplast” branded patches for individual application, 233% sales growth y-o-y.

OTC drugs

The top five bestsellers among OTC-drugs account for 99% of sales in the segment:

Xylene (Xylometazoline), 22% sales growth y-o-y;
Slabilene (Sodium picosulfate), 100% sales growth y-o-y;
Motilac (Domperidone), 23% sales growth y-o-y;
Vitasharm (Polyvitamins), 12% sales decrease y-o-y;
Vitatress (Polyvitamins), 54% sales growth y-o-y.

Production and Marketing of New Drugs

During the first quarter of 2007, Veropharm launched production and marketing of new RX drugs:

Heptor (Ademetionine) – marketed since March 2007;
Ornidazole-Vero (Ornidazole) – marketed since February 2007.

New drugs registered

In the first quarter of 2007, registration certificate has been received for a new drug in the pharmaco-therapeutical antidepressant group planned for production until the end of 2007 by Veropharm.

Debt

In Q1 2007, Veropharm’s debt amounted to USD 20.6 million.

* here and hereinafter financial indicators may significantly differ from the consolidated data of audited financial statements.

** % - as percentage of sales of finished goods.

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