Cosmo reports excellent first half

Cosmo reports excellent first half;

new product sales exceed expectations and important progress is attained in
products in development

strong increase in profits

Lainate, Italy - 31 July 2013 - Cosmo Pharmaceuticals S.p.A. (SIX: COPN)
announced today its half-year results for the period ended 30 June 2013.


  *Uceris®, launched in February in the USA, has exceeded all expectations.
  *The FDA agreed to the Special Protocol Assessment of Methylene Blue MMX®
    thus allowing green light for start of phase III clinical trials in the
    USA: EU in H2 2013.
  *Lialda® continues gaining market share.
  *Phase III clinical trials for Rifamycin SV MMX® in India re-opened.
  *A financial gain of EUR 58.2 million was attained on the sale of a part of
    the investment in Santarus.

Mauro Ajani, CEO of Cosmo Pharmaceuticals, commented: "I am very pleased with
the first half 2013. I always believed that the approval of Uceris® and
Cortiment® would be a major strategic step for Cosmo; my expectations have
been far exceeded by the reports on first prescriptions and sales of Uceris®.
When investors rewarded our Uceris® licensee Santarus with a further strong
increase of the share price, we decided to partially cash in on our investment
and made eight times our 2008 investment. This is very gratifying considering
that our relationship with Santarus continues developing smoothly. Thanks to
excellent support in the medical community who helped us design the phase III
clinical trial protocols for Methylene Blue MMX® we got the FDA to approve the
Special Protocol Assessment we requested. Phase III clinical trials of
Methylene Blue MMX® are now scheduled to start in H2 2013. The longer we can
wait in taking on a partner, the better our economic terms are likely to be. I
am convinced that Methylene Blue MMX® will help save many, many lives by
helping to improve the diagnosis of colon cancer and that it will become the
most important product of Cosmo. Last but not least, the Indian Authorities
have authorized our licensee Dr. Falk Pharma to continue with their phase III
clinical trials of Rifamycin SV MMX®. Data from these trials is necessary for
the filing of Rifamycin SV MMX® both in the USA as well as in the EU."

In the first six months, Lialda® continued gaining market share and Uceris®
was launched in the USA. Overall royalties thus increased by 30.9% to EUR 7.3
million and revenue from manufacturing of MMX® products increased by 9.8% to
EUR 8.4 million. Revenue from generics and contract drug manufacturing also
increased slightly, but the decision to postpone negotiations on the licensing
of Methylene Blue MMX® meant that only EUR 5.2 million revenue (from the USD
7.0 million milestone achieved due to the first sale of Uceris®) were
generated. Overall operating revenue reached EUR 26.6 million. Financial
income increased substantially due to the decision to sell part of the
Company's holdings in Santarus. 4'887'500 SNTS that had been purchased at EUR
1.77 were sold for USD 18.25 per share creating a net profit of EUR 58.2

Net operating expenses increased by 27.7% to EUR 19.9 million. Total personnel
employed remained at 161 persons but personnel expenses increased by EUR 1.6
million or 34.1% because a one-off goal attainment payment was made to all
employees after the approval of Uceris®. Costs for outsourced pre clinical and
clinical trials only increased slightly by 1.5%. Cost of sales increased
primarily because of the new costs related to the outsourced packaging of
Uceris®. Depreciation and amortization expense increased by 128.7% to EUR 2.7
million. This is due to the fact that, with the acquisition of Cristoforo
Colombo Real Estate S.r.l. in September 2012, property plant and equipment
increased substantially and because the amortization of the capitalized R&D
costs of Budesonide MMX® (Uceris® and Cortiment®) has started. The operating
result consequently declined to EUR 6.7 million but, due to the gain on the
sale of the Santarus shares, the profit after tax for the period increased by
238.6% to EUR 63.3 million. The basic profit per share, dividing the net
profit attributable to shareholders by the weighted average number of ordinary
shares during the period, reached EUR 4.514 up more than three times in
comparison to the first half of 2012.

Cash and cash equivalents at the end of the period totalled EUR 95.1million,
an increase of EUR 67.8 million or 248.5% from the end of last year. Financial
assets available for sale decreased by EUR 14.8 m or 22.5% because of the
decreased holdings of Santarus shares. In the first six months the Santarus
share price increased from USD 10.98 to USD 21.05.

Key consolidated financial figures

In EUR million (with the exception of the share data in
                                                          1H 2013   1H 2012
Revenue                                                   26.6      40.7
Cost of sales                                             (9.5)     (7.8)
Research and development expenses                         (5.8)     (4.4)
Selling, general and administrative expenses              (4.6)     (3.4)
Operating result                                          6.7       25.2
Net financial income                                      58.2      0.7
Profit before taxes                                       64.9      25.9
Profit after taxes for the period                         63.3      18.7
Profit per share                                          4.51      1.38
                                                          30.6.2013 31.12.2012
Cash and cash equivalents                                 95.1      27.3
Financial assets available for sale                       51.2      66.1
Total assets                                              207.3     151.8
Liabilities                                               25.0      27.2
Equity attrib. to owners of the company                   182.2     124.4

The Half-Year Report 2013 with further information was published on 31 July
2013, 7am CET, and is available for download at:


Management expects strong growth in Uceris® sales and also expects Lialda®
sales to continue growing at historical levels in H2. Furthermore the launch
of Cortiment® is expected in the Netherlands. This will drive MMX®
manufacturing revenues and royalties. It is expected that the phase III
Methylene Blue MMX® trials in the USA and EU will kick off in H2 and that
Rifamycin SV MMX® trials will resume in India.

Half year 2013 results conference call at 10:30 am CEST on 31 July 2013

Mauro Ajani, CEO, Luigi Moro, CSO, and Chris Tanner, CFO, will present the
half year results and discuss the outlook for 2013 at a conference call to be
held today at 10:30 am CEST.

The dial-in numbers:

+41 (0)58 310 50 00  Continental Europe
+44 (0) 203 0595 862 UK
+1 (1)631 570 5613   USA

The presentation is available for download at:

About Cosmo Pharmaceuticals

Cosmo is a speciality pharmaceutical company that aims to become a global
leader in the field of optimized therapies for selected Gastrointestinal and
topically treated Skin Disorders. The company's proprietary clinical
development pipeline specifically addresses innovative treatments for colonic
inflammatory and infective diseases. In addition, the Company is developing a
diagnostic for the detection of colon cancer and a new chemical entity in the
dermatogical area for the topical treatment of Acne, Alopecia and Hirsutism.
Cosmo's first product in the market is Lialda®/Mezavant®/Mesavancol®, a
treatment for mild to moderate Ulcerative Colitis that is licensed globally to
Giuliani and Shire. Cosmo's second product is Uceris(TM)/Cortiment(TM), a
steroid without the typical side effects of systemic steroids, that is
indicated for Ulcerative Colitis patients and is licensed globally to Santarus
and Ferring. Cosmo's proprietary MMX® technology is at the core of the
Company's product pipeline and was developed from its expertise in formulating
and manufacturing gastrointestinal drugs for international clients at its GMP
(Good Manufacturing Practice) facilities in Lainate, Italy. The technology is
designed to deliver active ingredients in a targeted manner in the lower part
of intestines. For further information on Cosmo, please visit the Company's

Next events

Full-year results 2013 reporting 27 March 2014
Annual General Meeting           16 April 2014


Dr. Chris Tanner, CFO and Head of Investor Relations

Cosmo Pharmaceuticals S.p.A.

Tel: +39 02 9333 7453

Some of the information contained in this press release contains
forward-looking statements. Readers are cautioned that any such
forward-looking statements are not guarantees of future performance and
involve risks and uncertainties, and that actual results may differ materially
from those in the forward-looking statements as a result of various factors.
Cosmo undertakes no obligation to publicly update or revise any
forward-looking statements.

Media release (PDF)

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