ALLERGAN EXPECTS LOWER FIRST HALF EARNINGS; Stock Repurchase Program Activated.

IRVINE, Calif.--(BW HealthWire)-- March 5, 1997--Allergan, Inc. (NYSE:AGN) today announced that it currently expects first half earnings to be lower than those reported for the first half of 1996. A recently compiled preliminary estimate for the first half of 1997 indicates that earnings per share could be as much as 20 percent below the comparable 1996 period. The corporation reported $0.80 per share for the first half of 1996, excluding the impact of the special charges in the second quarter of 1996. The expected decline in operating results is primarily due to launch expenses for new products and the continuing competitive pressures on the eye care business, as well as the impact of foreign currency fluctuations.

"We previously indicated that 1997, particularly the first half, would present significant challenges to deliver profitable growth while continuing to lay the groundwork needed to take advantage of new product opportunities before us," said William C. Shepherd, chairman and chief executive officer of Allergan.

"In June 1996, we announced a restructuring program designed to streamline operations and reduce our cost structure so that we could redeploy the savings into properly funding the launch of three significant new products," Shepherd continued. "The strong initial acceptance of ALPHAGAN(r) in the U.S. marketplace is ahead of our plan. In addition ALPHAGAN(r) has received approval in Brazil. ZORAC(r) has been launched in Germany and just received approval in Canada. Our operating expenses and R&D investments are on plan because of the steps we took last June. Despite the short term revenue issues we are staying with the restructuring program announced in 1996 since the substantial long-term payoff returns are still there."

"We continue to pursue the approvals of TAZORAC(r) and AMO(r)ARRAY(r) in the United States. Receipt of these approvals later this year could benefit sales performance during the second half of the year. However, the anticipated softness in the first half is expected to adversely affect the year as a whole," added Shepherd.

Stock Repurchase Program Activated

"At current price levels, we believe our stock represents an attractive investment opportunity for the corporation and shareholders," said Shepherd. "Our positive cash flow enables us to fund acquisitions and to activate the repurchase of common stock."

Under the terms of a stock repurchase plan previously approved by the Board of Directors in 1993, Allergan is authorized to make repurchases from time to time, at the discretion of management, in the open market or through privately negotiated transactions. Repurchased common shares are added to Allergan's treasury shares and used to meet common stock requirements for employee benefit plans. No common stock has been repurchased by Allergan since March 1994. The existing Board approval allows repurchase of up to 2.9 million shares at this time. On December 31, 1996, the corporation had 65,513,000 shares outstanding. The Board may be asked to approve a larger program.

With the exception of historical matters, the matters discussed in this release are forward-looking statements that involve risks and uncertainties. Actual operating results for the first half of 1997 and the balance of 1997 and beyond will depend upon a number of factors, including those that follow and those that are discussed elsewhere in this release and in prior company SEC filings, press releases and other public disclosures. The following factors have affected, and in the future could affect, Allergan's actual results and could cause Allergan's actual consolidated results during 1997, and beyond, to differ materially from those expressed in any forward-looking statements made by, or on behalf of, Allergan: difficulties, delays, failures and other risks of developing, testing, production and marketing of new products including the successful market launch and practitioner or consumer acceptance of new products such as ALPHAGAN(r), ZORAC(r)/TAZORAC(r) and the AMO(r)ARRAY(r); delays in securing regulatory approval to market such products or unfavorable conditions imposed by such regulatory authorities; foreign currency fluctuations; an increasing ability or willingness of practitioners or consumers to substitute generic products for Allergan pharmaceutical products; government pricing pressures on intraocular lenses; a maturing contact lens and lens care market in the United States and Europe, including the continued trend of contact lens users preferring lower priced cold chemical convenient systems over peroxide disinfection systems; and delays, difficulties, or inability to scale up manufacturing of new products or products transferred to new manufacturing locations as part of Allergan's plant consolidation programs, or otherwise.

Allergan, Inc., headquartered in Irvine, California, is a technology-driven, global health care company focused on specialty pharmaceutical products for specific disease areas that deliver value to customers, satisfy unmet medical needs and improve patients' lives.

CONTACT: Allergan Inc., Irvine

Jeff D'Eliscu

714/246-4636 (office)

714/675-9475 (home)