November 4, 2004

Neurochem reports results for third quarter of fiscal 2004.
Neurochem will host a conference call Thursday, Nov. 4, at 5:00 P.M. ET.

- Neurochem Inc. (NASDAQ: NRMX; TSX: NRM) today announced results for the third quarter of fiscal 2004, ended September 30. The Company reported a net loss of $13,775,000 ($0.45 per share) for the quarter, compared to $6,787,000 million ($0.28 per share) for the same period the previous year. The increase is largely due to research and development expenses which amounted to $7,760,000 this quarter compared to $3,840,000 for the same period last year as a result of accelerated patient recruitment for the North American Phase III clinical trial for Alzhemed™, Neurochem's investigational product candidate for the treatment of Alzheimer's Disease (AD).

At the end of the quarter, the Company reported cash, cash equivalents and marketable securities of $44,219,000, down from $49,574,000 on June 30, 2004.

"We are pleased with the progress at the Company," said Francesco Bellini, Ph.D., Neurochem's Chairman and CEO. "For Fibrillex™, our Phase II/III clinical program is on track to be completed by January 2005. For Alzhemed™, we have enrolled a large number of patients required for our North American Phase III clinical trial and we continue to see encouraging interim data from the on-going open-label Phase II clinical trial, particularly among mild Alzheimer's Disease patients whose conditions stabilize or even improve based on a number of memory and functional assessment scales," Dr. Bellini concluded.

Alzhemed™

Following the June 2004 launch of its 18-month double-blind, placebo-controlled, randomized Phase III clinical trial of Alzhemed™ for the treatment of AD in North America, Neurochem has 337 mild-to-moderate AD patients who have been screened to date. Of these, 163 patients are now randomized and are receiving study medication, either placebo or one of the two doses of Alzhemed™. The primary endpoints of this study include the evaluation of cognitive and functional abilities with the Alzheimer's Disease Assessment Scale, cognitive subpart (ADAS-cog) and Clinical Dementia Rating Scale-Sum of Boxes (CDR-SB).

Neurochem also reported that its two-year on-going open-label Phase II extension study for Alzhemed™ continued to produce promising interim results in AD patients. During the third quarter, the 20-month data showed that the large majority of the mild AD patients responded well to treatment with Alzhemed™ and continued to stabilize or improve as measured by well validated cognitive and functional tests such as ADAS-cog, MMSE (Mini Mental State Exam) and CDR-SB.

Fibrillex™

The Company is approaching the completion of its Phase II/III clinical trial of Fibrillex™, which is planned to end in January 2005. To date, 68 patients have completed the two-year study. Of these, 66 (97%) have enrolled in the open-label Phase II/III extension study that will run for two years.

This investigational product candidate was selected by the Cardio-Renal Drug Product Division of the US Food and Drug Administration (FDA) to be part of the Continuous Marketing Applications Pilot 2 program to further accelerate the development and eventual marketing of this product candidate.

Cerebril™

For Cerebril™, Neurochem's investigational product candidate for the treatment of Hemorrhagic Stroke due to Cerebral Amyloid Angiopathy (HS-CAA), the Company continues to work towards the preparation of the Phase IIb protocol in collaboration with the principal investigator and Clinical Advisory Board member for this product candidate, Steven M. Greenberg, M.D., Co-Director of the Neurology Clinical Unit of the Massachusetts General Hospital. The trial is expected to test the safety and efficacy of Cerebril™ for the prevention of recurrence of HS-CAA.

Conference Call

Neurochem will host a conference call Thursday, Nov. 4, 2004, at 5:00 P.M. ET. The telephone number to access the conference call is 416 695-5252 or 1 877 461-2815. A replay of the call will be available until Nov. 11, 2004. The telephone number to access the replay of the call is 1 866 518-1010. Please mention that you are calling for the Dr. Bellini or Neurochem conference replay.

Financial Results Highlights

The following information should be read in conjunction with the selected financial information contained herein.

Results of operations

For the three-month period ended September 30, 2004, net loss amounted to $13,775,000 ($0.45 per share), compared to $6,787,000 ($0.28 per share) for the same period last year. For the nine-month period ended September 30, 2004, net loss amounted to $37,011,000 ($1.23 per share), compared to $15,866,000 ($0.55 per share) for the same period last year.

Research and development expenses, before research tax credits and grants, amounted to $7,760,000 for the current quarter, compared to $3,840,000 for the same period last year. The increase is mainly due to expenses incurred in relation to the Alzhemed™ Phase III clinical trials, which began during the quarter, the Fibrillex™ clinical trials and the hiring of additional employees primarily in the clinical development group. For the nine-month period ended September 30, 2004, research and development expenses amounted to $20,260,000, compared to $13,172,000 for the same period last year. The increase is attributable to expenses incurred to support the on-going Fibrillex™ Phase II/III clinical trials and open-label extension study, the on-going Alzhemed™ Phase II open-label extension study and Phase III clinical trials, as well as on-going drug discovery programs.

Research tax credits amounted to $301,000 this quarter ($922,000 for the nine-month period), compared to $315,000 for the comparable quarter last year ($1,302,000 for the nine-month period last year). Research tax credits represent tax credits earned under the Quebec Scientific Research and Experimental Development program.

Research grants and other amounted to $98,000 this quarter, compared to $101,000 for the same quarter last year. For the nine-month period ended September 30, 2004, these grants amounted to $327,000, compared to $846,000 for the same period last year. Research grants consist primarily of those grants received from the US Food and Drug Administration for the development of Fibrillex™ and from the Natural Sciences and Engineering Research Council (NSERC). During the nine-month period ended September 30, 2003, research grants also included contributions under the Technology Partnerships Canada (TPC) Program received by the Company for the development of Alzhemed™.

General and administrative expenses for the quarter totaled $4,913,000, compared to $3,018,000 for the same quarter last year. The increase is mainly due to the expansion of the corporate infrastructure necessary to support growth and the increase in overall activity levels at the Company, including the costs related to the facilities acquired during the second quarter. For the nine-month period ended September 30, 2004, these expenses amounted to $13,502,000 compared to $7,733,000 for the same period last year. For the nine-month period, the increase is attributable to the growth in the legal, administrative and marketing activities, as well as additional senior management positions. More specifically, the increase is due to higher legal fees incurred in relation to the Immtech litigation and other corporate matters, higher Directors' and Officers' insurance costs resulting from our US financing and NASDAQ listing and increased awareness, educational and medical conference activities related to AA Amyloidosis, Fibrillex™'s target indication, and Alzheimer's Disease, Alzhemed™'s target indication.

Special charges of $2,085,000 in the nine-month period ended September 30, 2004, were recorded in the second quarter and are related to the relocation to facilities acquired in May 2004. These charges include $896,000 of future lease payments due in connection with the former premises, net of estimated sublease income that could reasonably be obtained for those premises. It also includes the write-off of certain property and equipment, mainly leasehold improvements, in the amount of $1,189,000.

Depreciation and amortization for the current quarter increased to $587,000 ($1,454,000 for the nine-month period) from $323,000 for the comparable quarter last year ($964,000 for the nine-month period last year). The increase reflects the depreciation and amortization associated with the acquisition of additional property and equipment, including the facilities acquired in the second quarter, as well as increases in patent costs.

Interest income amounted to $247,000 ($822,000 for the nine-month period), compared to $127,000 for the comparable quarter last year ($445,000 for the nine-month period last year). The increase results from higher average cash balances in the current period compared to the same period last year.

Foreign exchange losses amounted to $392,000 for the current quarter, compared to $127,000 for the same quarter last year. For the nine-month period ended September 30, 2004, foreign exchange gains amounted to $1,699,000 compared to $2,000 for the same period last year. Foreign exchange gains realized in 2004 are mainly attributable to the conversion of US dollars into Canadian dollars.

Acquisition of property and equipment
In May 2004, the Company acquired facilities for $10,500,000 and incurred $421,000 of acquisition related expenses to relocate its operations. This acquisition was necessary to support the growth of the Company and to regroup corporate and scientific employees at the same location. Cash was used to finance the acquisition. In July 2004, the Company entered into a revolving decreasing term credit agreement in the amount of $10,500,000 to finance this acquisition. The credit agreement expires in June 2009.

Stock-based compensation
As of January 1, 2004, the Company implemented the new CICA accounting policy requiring the use of the fair value-based method for recording stock options. One of the transitional alternatives available to the Company was to retroactively apply the fair value-based method to all employee stock options granted on or after July 1, 2002, without restatement of prior periods. As a result of adopting this alternative, an amount of $2,162,000 was recorded as an adjustment to the opening deficit and additional paid-in capital at January 1, 2004. Furthermore, an expense in the amount of $666,000 was recorded during the quarter ($3,329,000 for the nine-month period). See notes 2 and 6 of the interim Consolidated Financial Statements.

Litigation
The Company continues to vigorously defend against the claims brought by Immtech International, Inc. in its legal proceedings filed on August 12, 2003, with the Federal District Court for the Southern District of New York, U.S.A. The Company is seeking to enforce its rights under the agreement with Immtech International, Inc. to have the dispute between the parties resolved by arbitration in accordance with the terms of that agreement. The proceedings are at the early stages and the outcome of this matter, or the likelihood and the amount of loss, if any, is not determinable. No provision for possible loss has been recorded by the Company in connection with this matter.

Liquidity and capital resources
As at September 30, 2004, the Company had cash, cash equivalents and marketable securities in the amount of $44,219,000 compared to $77,594,000 at December 31, 2003. The decrease is due to use of funds for operating and investing activities, (including the acquisition of facilities as previously discussed), net of proceeds received from the revolving decreasing term credit agreement and the issue of additional share capital pursuant to the exercise of employee stock options.

As at October 31, 2004, the Company had 30,320,336 common shares outstanding, 2,390,159 options granted under the employee stock option plan and 4,000,000 warrants in issue.

Neurochem Inc.
Selected Financial Highlights¹
($'000 CDN, except per share data)

Three-month period ended September 30

Nine-month period ended September 30

Consolidated Statements of Operations

2004

2003

2004

2003

Expenses (Income):

Research and
  development

7,760

3,840

20,260

13,172

Research tax credits
  & grants

(399)

(416)

(1,249)

(2,148)

General and
  administrative

4,913

3,018

13,502

7,733

Stock based
  compensation

666

-

3,329

-

Special charges

-

-

2,085

-

Depreciation and
  amortization

587

323

1,454

964

Interest and
  bank charges

103

22

151

76

13,630

6,787

39,532

19,797

Interest income

247

127

822

445

Foreign exchange
  gain / (loss)

(392)

(127)

1,699

2

Gain on disposal of
  intellectual property

-

-

-

3,484

Net loss

(13,775)

(6,787)

(37,011)

(15,866)

Loss per share:

Basic

$ (0.45)

$ (0.28)

$ (1.23)

$ (0.68)

Diluted

$ (0.45)

$ (0.28)

$ (1.23)

$ (0.68)

Weighted average number of common shares outstanding:

Basic

30,281,440

24,034,052

30,103,171

23,328,076

Diluted

34,045,804

28,300,178

34,350,786

27,054,582

Consolidated
Balance Sheets

At September 30 2004

At December 31 2003

Cash, cash equivalents
  and marketable
  securities

44,219

77,594

Other current assets

4,977

4,503

Total current assets

49,196

82,097

Long-term investment

4,421

4,421

Capital assets

20,629

7,481

Other long term assets

1,172

226

Total assets

75,418

94,225

Current liabilities

9,978

6,244

Long term debt

9,625

-

Obligations under
  capital leases

78

416

Long term
  accrued liabilities

568

-

Shareholders' equity

55,169

87,565

Total liabilities and
  shareholders' equity

75,418

94,225

¹ Condensed from the Company's unaudited consolidated financial statements.

About Neurochem

Neurochem is focused on the development and commercialization of innovative therapeutics for neurological disorders. The Company's pipeline of proprietary, disease-modifying oral products addresses critical unmet medical needs. Fibrillex™, designated as an orphan drug and as a Fast Track Product candidate, is also part of a Continuous Marketing Applications Pilot 2 program and is currently in a Phase II/III clinical trial for the treatment of Amyloid A Amyloidosis. Alzhemed™, for the treatment of Alzheimer's Disease, is in a Phase III clinical trial and Cerebril™, for the prevention of Hemorrhagic Stroke caused by Cerebral Amyloid Angiopathy, has completed a Phase II clinical trial.

To Contact Neurochem

For additional information on Neurochem and its drug development programs, please call the North American toll-free number 1 877 680-4500 or visit our Web Site at: www.neurochem.com.

Certain statements contained in this news release, other than statements of fact that are independently verifiable at the date hereof, may constitute forward-looking statements. Such statements, based as they are on the current expectations of management, inherently involve numerous risks and uncertainties, known and unknown, many of which are beyond Neurochem's control. Such risks include but are not limited to: the impact of general economic conditions, general conditions in the pharmaceutical industry, changes in the regulatory environment in the jurisdictions in which Neurochem does business, stock market volatility, fluctuations in costs, and changes to the competitive environment due to consolidation, as well as other risks disclosed in public filings of Neurochem. Consequently, actual future results may differ materially from the anticipated results expressed in the forward-looking statements. The reader should not place undue reliance on, if any, the forward-looking statements included in this news release. These statements speak only as of the date made and Neurochem is under no obligation and disavows any intention to update or revise such statements as a result of any event, circumstances or otherwise.

For further Information, please contact:
Dr. Lise Hébert
Vice President, Corporate Communications
lhebert@neurochem.com

275 Armand-Frappier
Laval (Quebec)
H7V 4A7
Tel: (450) 680-4500
Fax: (450) 680-4501

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