NPS Pharmaceuticals Reports 2012 Financial Results and 2013 Guidance

  NPS Pharmaceuticals Reports 2012 Financial Results and 2013 Guidance

-- Gattex^® (teduglutide [rDNA Origin]) for injection now launched in the U.S.
              for the treatment of adult short bowel syndrome --

                  -- Conference call today at 4:30 PM ET --

Business Wire

BEDMINSTER, N.J. -- February 21, 2013

NPS Pharmaceuticals, Inc. (NASDAQ: NPSP), a biopharmaceutical company
pioneering and delivering therapies that transform the lives of patients with
rare diseases worldwide, reported its results for the fourth quarter and year
ended December 31, 2012.

Financial Highlights

  * NPS reported a net loss of $12.2 million or $0.14 per diluted share for
    the fourth quarter of 2012, compared to a net loss of $8.6 million or
    $0.10 per diluted share for the fourth quarter of 2011. For the full year,
    NPS reported a net loss of $18.7 million in 2012 versus a net loss of
    $36.3 million in 2011.
  * The company’s full-year financial results were positively impacted by $25
    million in revenue related to the sale to Amgen of its rights to receive
    royalties from Amgen for any sales of Sensipar^®/Mimpara^® earned after
    December 31, 2018.
  * Cash and investments totaled $100.7 million at December 31, 2012, compared
    with $162.2 million at December 31, 2011. The company’s cash and
    investments balance exceeded its guidance to end the year with at least
    $92 million of cash and investments.

“We executed our business plan exceptionally well in 2012 and secured FDA
approval of our first proprietary product, Gattex®,” said Francois Nader,
M.D., president and chief executive officer of NPS Pharmaceuticals. “The
launch of Gattex is underway as the first and only long-term treatment for
adult short bowel syndrome, an ultra-orphan and highly debilitating disorder.
Gattex has tremendous potential to transform patients’ lives and grow our
business substantially. In the year ahead, we look forward to providing
updates on our launch progress, reporting results from our STEPS 2 study, and
beginning a pediatric development program for Gattex. We are also preparing
for other important milestones including the submission of our Biologics
License Application for our second proprietary product, Natpara®, as the first
replacement therapy for hypoparathyroidism.”

Dr. Nader added: “It is especially notable that our royalty-based portfolio
continues to provide an important financial foundation for our business,
including our Sensipar royalty agreement with Amgen that is now generating
more than $64 million in annual cash flows that are expected to increase to
more than $100 million after repayment of the Amgen royalty advance.”

Gattex launch highlights

  * Gattex is now available for shipment and the company’s 30-person strong
    field force is fully deployed and calling on targeted healthcare
    providers.
  * NPS introduced Gattex to a target audience of healthcare providers at the
    American Society of Parenteral and Enteral Nutrition’s Clinical Nutrition
    Week, which was held February 9-12 in Phoenix. Clinical Nutrition Week is
    the premier conference on clinical nutrition and metabolism. NPS supported
    a continuing medical education or CME symposium entitled “Current and
    Emerging Approaches to Promoting Intestinal Adaptation in Adults with
    Short Bowel Syndrome (SBS).”
  * NPS’ field-based key account directors are presenting detailed information
    regarding the clinical burden of SBS and the value of treatment with
    Gattex to a comprehensive group of private and government insurers. The
    information has been well-received by public and private payers and
    feedback has been consistent with the company’s pre-launch market access
    research, which indicated coverage of Gattex with a tier placement and
    restrictions typical of ultra-orphan products.
  * NPS Advantage™, the company’s personalized support program for Gattex
    patients, is fully operational and the company’s Care Coordinators are
    interacting with healthcare providers and conducting personalized benefits
    investigations for Gattex-eligible patients.
  * Gattex is being distributed through a limited distribution network of
    specialty pharmacies. In addition to product distribution, these companies
    will also provide Gattex-related clinical services for those SBS patients
    who are within their network.

Other business highlights

Gattex^® (teduglutide) in short bowel syndrome

  * On December 21, 2012, the U.S. Food and Drug Administration’s (FDA)
    Gastrointestinal Drugs Advisory Committee approved Gattex^® (teduglutide
    [rDNA origin]) for injection, for subcutaneous use for the treatment of
    adult patients with SBS who are dependent on parenteral support. Gattex is
    now available for shipment in the U.S. For full prescribing information,
    please visit www.Gattex.com.

  * The company’s Phase 3 study of Gattex was published in the peer-reviewed
    journal, Gastroenterology, the official journal of the American
    Gastroenterological Association. The 24-week study, known as STEPS, showed
    that Gattex was effective and well-tolerated in reducing parenteral
    support volume and number of infusion days in SBS patients.
  * The Journal of Parenteral and Enteral Nutrition recently published
    clinical considerations and best-practice recommendations for introducing
    Gattex into the management of SBS. The recommendations conclude that
    integrating Gattex into a coordinated approach to treating SBS may result
    in more success in rehabilitating the intestine and weaning SBS patients
    from parenteral support.
  * NPS expects STEPS 2, a 24-month, open-label study in adult SBS, to
    complete in the first quarter of 2013 and will report results thereafter.
  * NPS expects to meet with the FDA in the first half of 2013 and discuss its
    development strategy for pediatric SBS thereafter.

Natpara^® (recombinant human parathyroid hormone [1-84]) in hypoparathyroidism

  * NPS has met with FDA to discuss its Human Factors/Usability testing of the
    Naptara injection pen device. The final study will be initiated in March
    2013 with results expected in the second quarter of 2013.
  * NPS continues to work toward submitting its U.S. Biologics License
    Application (BLA) for Natpara. In order to finalize its submission, the
    company needs to resolve certain previously disclosed manufacturing
    issues. The company expects to complete certain key root cause analyses
    during the second quarter of 2013. Subject to resolution of the
    manufacturing issue, the company expects to submit its BLA in the second
    half of 2013.

Financial results

Royalties

Royalty revenues were $27.1 million for the fourth quarter of 2012 and $26.3
million for the fourth quarter of 2011. For the full year, royalty revenues
were $105.6 million for 2012 compared with $96.5 million for 2011. NPS earns
royalties on (i) Amgen’s sales of Sensipar^®/Mimpara^® (cinacalcet HCl), (ii)
Kyowa Hakko Kirin’s sales of REGPARA^® (cinacalcet HCl), (iii) Nycomed’s sales
of Preotact^® (recombinant parathyroid hormone 1-84 [rDNA origin] injection),
and (iv) Janssen Pharmaceuticals’ sales of NUCYNTA^® (tapentadol) and
NUCYNTA^® ER (tapentadol extended-release tablets).

The components of royalties are summarized as follows:

                      Quarter ended           Year ended
In millions                                                     
                      December 31,            December 31,
                      2012      2011          2012       2011   
Royalty:                                                
Sensipar              $24.0     $20.9         $89.3      $77.6
REGPARA               2.3       2.2           8.7        7.6
Preotact              --        2.6           4.8        9.1
NUCYNTA and other     0.8       0.6           2.8        2.2    
Total                 $27.1     $26.3         $105.6     $96.5  
                                                                

On February 15, 2013, the company received a cash payment of $16 million for
the Sensipar royalties earned during the fourth quarter of 2012. The remaining
$8 million of Sensipar royalties will be retained to repay a royalty advance
received in August 2011 from Amgen. At December 31, 2012, NPS had $80.2
million in long-term, non-recourse debt secured by its Sensipar royalties.

Research and development

Research and development expenses were $24.0 million for the fourth quarter of
2012 and $21.6 million for the fourth quarter of 2011. The increase in
fourth-quarter research and development expense is primarily driven by
personnel-related expenses, including non-cash expense associated with equity
awards that vested upon Gattex approval. For the full year, research and
development expenses were $94.8 million for 2012 compared with $73.8 million
for 2011. The increase in 2012 research and development expenses was primary
due to the production of pre-launch Gattex and Natpara inventory, regulatory
activities, medical affairs activities, and personnel-related costs, which
included non-cash expense associated with equity awards that vested upon the
approval of Gattex.

General and administrative

General and administrative expenses were $11.2 million for the fourth quarter
of 2012 and $7.2 million for the fourth quarter of 2011. For the full year,
general and administrative costs were $36.9 million for 2012 compared with
$24.2 million for 2011. The increase in general and administrative expenses
was primarily due to commercial-readiness activities for Gattex and
personnel-related expenses, including non-cash expense associated with equity
awards that vested upon the approval of Gattex.

Interest expense

Interest expense was $3.8 million for the fourth quarter of 2012 and $6.6
million for the fourth quarter of 2011. For the full year, interest expense
was $18.2 million in 2012 versus $37.7 million in 2011. Interest expense was
largely attributable to non-recourse debt secured by the company’s
Sensipar/Mimpara, REGPARA, and Preotact royalties. The decline in interest
expense was primarily attributable to a reduction in the outstanding principal
and interest rate associated with Sensipar/Mimpara-secured non-recourse debt.

Cash and investments

The company’s cash, cash equivalents, and marketable investment securities
were approximately $101 million at December 31, 2012 compared with $162
million at December 31, 2011.

Long-term debt

At December 31, 2012, the company’s only recourse debt was $16.5 million in
5.75% convertible notes due in 2014.

All other debt on the company’s balance sheet is non-recourse and secured
solely by its royalty rights related to Sensipar/Mimpara, Preotact, and
REGPARA. After repayment of these obligations, the cash flows from these
royalties will revert to NPS in accordance with the terms set forth in each
agreement.

The following table reflects the company’s non-recourse debt at December 31,
2012 and 2011:

In millions                                           
                                      December 31,     December 31,

                                      2012             2011
Non-recourse debt:
Sensipar/Mimpara-secured              $80.2            $126.8
Preotact-secured                      42.8             48.3
REGPARA-secured                       36.3             36.3
Total non-recourse debt               159.3            211.4
Less current portion                  6.3              19.3
Total long-term non-recourse debt     $153.0           $192.1
                                                        

2013 Financial guidance

NPS is providing the following financial guidance for 2013. The guidance
comprises projections based on numerous assumptions, all of which are subject
to certain risks and uncertainties. For a discussion of the risks and
uncertainties associated with these forward-looking statements, please see the
disclosure notice below.

In 2013, NPS expects its operating expenses, including the impact of
share-based compensation, to be between $135 and $145 million.

For 2013, the company will provide the number of patients on Gattex at the end
of each quarter, starting with its second quarter financial results
announcement.

Conference Call Information

NPS will host a conference call beginning today at 4:30 p.m. Eastern Time. To
participate in the conference call, dial (866) 783-2137 and use pass code
99534128. International callers may dial (857) 350-1596, using the same pass
code. In addition, a live audio of the conference call will be available over
the Internet. Interested parties can access the event through the NPS website,
http://www.npsp.com.

For those unable to participate in the live call, a replay will be available
at (888) 286-8010, with pass code 99734684, until midnight Eastern Time, March
7, 2013. International callers may access the replay by dialing (617)
801-6888, using the same pass code. The webcast will also be available through
the NPS website for the same period.

About NPS Pharmaceuticals

NPS Pharmaceuticals is a biopharmaceutical company pioneering and delivering
therapies that transform the lives of patients with rare diseases worldwide.
The company’s lead product, Gattex® 0.05 mg/kg/d (teduglutide [rDNA origin])
for injection is FDA-approved for the treatment of adult patients with short
bowel syndrome (SBS) who are dependent on parenteral support. NPS is also
developing Natpara® (rhPTH[1-84]) for the treatment of adult
hypoparathyroidism and expects to submit its Biologic License Application
(BLA) to the FDA in 2013.

NPS's earlier stage pipeline includes two calcilytic compounds, NPSP790 and
NPSP795, with potential application in rare disorders involving increased
calcium receptor activity, such as autosomal dominant hypocalcemia with
hypercalciuria (ADHH). NPS complements its proprietary programs with a
royalty-based portfolio of products and product candidates that includes
agreements with Amgen, GlaxoSmithKline, Janssen Pharmaceuticals, Kyowa Hakko
Kirin, and Takeda GmbH.

"NPS," "NPS Pharmaceuticals," "Gattex," and "Natpara" are the company's
trademarks. All other trademarks, trade names or service marks appearing in
this press release are the property of their respective owners.

Disclosure notice

Statements made in this press release, which are not historical in nature,
constitute forward-looking statements for purposes of the safe harbor provided
by the Private Securities Litigation Reform Act of 1995. These statements are
based on the company's current expectations and beliefs and are subject to a
number of factors and uncertainties that could cause actual results to differ
materially from those described in the forward-looking statements. Forward
looking statements include, but are not limited to, statements concerning our
future financial performance. Risks associated to the company's business
include, but are not limited to, the risks associated with any failure by the
company to successfully commercialize Gattex, including the risk that
physicians and patients may not see the advantages of Gattex and may therefore
be reluctant to utilize the product, the risk that private and public payers
may be reluctant to cover or provide reimbursement for Gattex, the risks that
the company may be unable to resolve the manufacturing issue in order to
submit its BLA for Natpara, the risks associated with the company's strategy,
global macroeconomic conditions, the impact of changes in management or staff
levels, the effect of legislation effecting healthcare reform in the United
States, as well as other risk factors described in the company's periodic
filings with the U.S. Securities and Exchange Commission, including its Annual
Report on Form 10-K and Form 10-Qs. All information in this press release is
as of the date of this release and NPS undertakes no duty to update this
information, whether as a result of new information, future events or
otherwise.

                       (Financial statements to follow)

 
NPS Pharmaceuticals and Subsidiaries

Condensed Consolidated Statements of Operations

(In thousands, except per share data)

(Unaudited)
                                                                    
                   Three Months Ended               Twelve months ended
                   December 31,                     December 31,
                     2012             2011            2012             2011      
                                                                      
Revenues:
Royalties          $ 27,134         $ 26,258        $ 105,587        $ 96,502
Sale of              --               --              25,000           --
royalty rights
Milestones and       50               --              57               5,044
license fees
Product sales        --               --              --               99        
Total revenues       27,184           26,258          130,644          101,645   
                                                                      
Costs and
expenses:
Cost of              --               --              --               500
royalties
Cost of              --               3               --               2,543
license fees
Research and         24,042           21,564          94,839           73,831
development
General and          11,160           7,198           36,929           24,226    
administrative
Total
operating            35,202           28,765          131,768          101,100   
expenses
Operating            (8,018   )       (2,507  )       (1,124   )       545
income (loss)
Other
(expense)
income:
Interest             68               61              292              321
income, net
Interest             (3,753   )       (6,586  )       (18,198  )       (37,736  )
expense
Other                (500     )       396             295              621       
Total other          (4,185   )       (6,129  )       (17,611  )       (36,794  )
expense, net
Loss before
income tax           (12,203  )       (8,636  )       (18,735  )       (36,249  )
expense
                                                                      
Income tax           --               --              --               18        
expense
Net loss             ($12,203 )       ($8,636 )       ($18,735 )       ($36,267 )
Net loss per
common and
potential
common share:
Basic                ($0.14   )       ($0.10  )       ($0.22   )       ($0.45   )
Diluted              ($0.14   )       ($0.10  )       ($0.22   )       ($0.45   )
Weighted
average common
and potential
common share:
Basic                87,266           86,803          86,999           81,279    
Diluted              87,266           86,803          86,999           81,279    
                                                                                 

NPS Pharmaceuticals and Subsidiaries

Condensed Consolidated Balance Sheets

(In thousands)

(Unaudited)
                                               December 31,       December 31,
                                               2012               2011
Assets:
Cash, cash equivalents and marketable          $100,715           $162,233
investment securities
Account receivable                               30,276             29,532
Other current assets                             6,060              7,863
Property and equipment, net                      4,193              4,346
Goodwill                                         9,429              9,429
Debt issuance costs, net                         436                577       
Total assets                                   $151,109           $213,980    
                                                                   
Liabilities and Stockholders’ Deficit:
Current liabilities                            $29,567            $43,603
Convertible notes                                16,545             16,545
Non-recourse debt, less current portion*         153,024            192,085
Other long-term liabilities                      6,614              7,863     
Total liabilities                                205,750            260,096
                                                                   
Common stock and additional paid-in              954,539            944,430
capital
Accumulated other comprehensive income           5                  (96      )
Accumulated deficit                              (1,009,185 )       (990,450 )
Total stockholders' deficit                      (54,641    )       (46,116  )
Total liabilities and stockholders'            $151,109           $213,980    
deficit
                                                                   
* Non-recourse debt secured by Sensipar^®/Mimpara^®, Preotact^® and REGPARA^®
royalty revenue

Contact:

NPS Pharmaceuticals, Inc.
Susan M. Mesco, 908-450-5516
smesco@npsp.com